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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of July, 2006
GRUPO IUSACELL, S.A. de C.V.
-----------------------------------------------
(Translation of registrant's name into English)
Montes Urales 460
Col. Lomas de Chapultepec, Deleg. Miguel Hidalgo
11000, Mexico D.F.
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(Address of principal executive office)
Indicate by check mark whether the registrant files or will fill annual reports
under cover of Form 20-F or Form 40-F: Form 20-F [X] Form 40-F [ ]
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g-3-2(b) under the Securities and Exchange Act of
1934. Yes [ ] No [X]
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Documents Furnished By the Registrant
1. Press Release of the Registrant dated July 28, 2006
2
IUSACELL REPORTS SECOND QUARTER 2006 RESULTS
- NET REVENUES INCREASE 27% -
Mexico City, July 28, 2006 - Grupo Iusacell, S.A. de C.V. (BMV: CEL),
reported its financial results corresponding to the second quarter of 2006.
FINANCIAL INFORMATION
Million pesos as of June 30, 2006
Change Change
-------------------- ------------------
2Q05 2Q06 $ % 6M05 6M06 $ %
-------- -------- -------- -------- -------- -------- -------- ------
Net Revenues 1,460 1,852 392 27% 2,831 3,653 822 29%
Total Cost 763 1,115 353 46% 1,440 2,210 769 53%
Operating Expenses 389 437 48 12% 808 870 62 8%
EBITDA 308 300 (9) 3% 583 573 (9) (2)%
Net Loss (34) (867) (833) (n.m.) (409) (1,355) (946) (231)%
RECENT EVENTS
As of July 2006, Iusacell's subscribers will now have international
data service for easy access to mobile applications as a result of Iusacell's
entering into a new agreement with Sprint of the USA. The Sprint data roaming
agreement for coverage in North America is part of the international expansion
of Iusacell in 2006.
Iusacell is extending the network coverage for its clients through data
roaming agreements. Under the terms of this agreement, our users will be able to
have easy access to email, Internet and corporative applications in the United
States using selected cellular telephones, intelligent devices and broadband
mobile cards as if they were connected to the local network of Iusacell.
3
SECOND QUARTER RESULTS
REVENUES
Net revenues in the second quarter of 2006 increased by 27% to Ps
$1,852 million, as compared to Ps $1,460 million during the same period 2005.
The increase is primarily a result of growth in postpaid revenues as well as
higher revenues from value added services mainly attributable to an increase in
the subscriber base. Grupo Iusacell ended the second quarter of 2006 with 2.0
million subscribers.
COST AND EXPENSES
During the second quarter of 2006, total cost, increased by 46% to Ps
$1,115 million as compared to Ps $763 million in the second quarter 2005.
Operating expenses increased by 12% to Ps $437 million, as compared to Ps $389
million in the same period 2005.
The increase in the total cost during the second quarter 2006 mainly
reflects the increase in: (i) handset subsidy, (ii) the costs related to value
added services and interconnection costs as a result of the increase in air time
traffic and subscribers, (iii) technical expenses, and (iv) concessions rights.
The increase in operating expenses during the second quarter 2006
mainly reflects an increase in administrative expenses owing to the creation of
regional sales and customer care structures, offset by the reduction in
advertising expenses.
OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION
Iusacell's operating income before depreciation and amortization for
the second quarter of 2006 was Ps $300 million, a decrease of 3% as compared to
Ps $308 million during the same period the year before.
NET INCOME
Iusacell registered a net loss of Ps $867 million for the second
quarter of 2006, compared to a net loss of Ps $34 million during the same period
in 2005. This loss is mainly a result of an increase in integral financing costs
affected mainly by the exchange loss derived from the increase in exchange rates
of the peso against the dollar.
CAPEX
During the second quarter of 2006, the Company made investments of
approximately US $17 million, mainly for the acquisition of cellular equipment
related to the expansion of coverage and capacity of Iusacell's 3-G network and
EV-DO services (Evolution Data Only).
DEBT
The Company continues with its debt restructuring process as announced
through various press releases to date. In this respect and in furtherance of
the debt restructuring process, the Company has commenced various proceedings
for the legal implementation of the agreements reached with majority of its
creditors, which we expect to be accomplished shortly.
**********************
4
ABOUT IUSACELL
Grupo Iusacell, S.A. de C.V.(BMV: CEL)(Iusacell) is a wireless
cellular and PCS service provider in Mexico with a national footprint. Iusacell
offers more and better voice communication and data services through
state-of-the-art technology, such as its new 3G network, throughout all of the
regions in which it operates. In addition to our core mobile telephony services,
we also provide a wide range of other telecommunications services, including
long distance, wireless local telephony and data transmission services.
Additional information is available at http://www.iusacell.com
LEGAL DISCLAIMER
Grupo Iusacell, S.A. de C.V. quarterly reports and all other written
materials may from time to time contain statements about expected future events
and financial results that are forward-looking and subject to risks and
uncertainties. For those statements, the Company claims the protection of the
safe harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. A discussion of factors that may affect future
results is contained in our filings with the Securities and Exchange Commission.
Attached are the Consolidated Income Statements of each of Grupo
Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V. for the
three-month and six-month periods ended June 30, 2006, and the Consolidated
Balance Sheet of Grupo Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A.
de C.V. at June 30, 2006.
CONTACTS:
---------
JOSE LUIS RIERA K. J. VICTOR FERRER V.
Chief Financial Officer Finance Manager
GRUPO IUSACELL S.A. DE C.V. GRUPO IUSACELL S.A. DE C.V.
+52 (55) 5109-5927 +52 (55) 5109-5273
vferrer@iusacell.com.mx
5
GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER
(UNAUDITED FIGURES)
QUARTERLY INCOME STATEMENT
---------------------------------------------------------------------
2Q05 2Q06 CHANGE
--------------------- --------------------- ---------------------
Gross Revenues 107% 1,560 105% 1,947 387 25%
Commissions (7)% (100) (5)% (95) 5 5%
--------------------- ---------------------
Net Revenues 100% 1,460 100% 1,852 392 27%
--------------------- ---------------------
Cost of services 42% 620 43% 793 173 28%
Handset Subsidy 10% 143 17% 323 180 126%
--------------------- ---------------------
Total Cost 52% 763 60% 1,115 353 46%
--------------------- ---------------------
Gross Profit 48% 698 40% 737 39 6%
--------------------- ---------------------
Operating Expenses 27% 389 24% 437 48 12%
Depreciation and Amortization 27% 398 20% 379 (19) (5)%
--------------------- ---------------------
Total Expenses 54% 787 44% 816 30 4%
--------------------- ---------------------
Operating Loss (6)% (89) (4)% (79) 10 11%
--------------------- ---------------------
Operating Profit before Depreciation
and Amortization 21% 308 16% 300 (9) (3)%
--------------------- ---------------------
Loss from sale of fixed assets and
other expenses 1% 10 1% 11 2 19%
Comprehensive Financing Cost
Interest Expense - Net (19)% (283) (17)% (310) (27) (9)%
Exchange gain (loss) 29% 425 (23)% (430) (856) (201)%
Gain from net monetary position (3)% (49) (3)% (59) (10) (20)%
--------------------- ---------------------
6% 93 (43)% (800) (892) (n.m.)
--------------------- ---------------------
Loss before taxes 1% 13 (47)% (868) (881) (n.m.)
--------------------- ---------------------
Tax Provisions (3)% (44) (0)% (1) 43 97%
Equity in income (loss) of subsidiaries 0% - 0% 0 0 n.m.
Minority interest (0)% (3) 0% 2 5 180%
--------------------- --------------------- ---------------------
Net loss (2)% (34) (47)% (867) (833) (n.m.)
===================== ===================== =====================
6
GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER
(UNAUDITED FIGURES)
ACCUMULATED INCOME STATEMENT
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6M05 6M06 CHANGE
--------------------- --------------------- ---------------------
Gross Revenues 107% 3,035 106% 3,859 824 27%
Commissions (7)% (204) (6)% (206) (2) (1)%
--------------------- ---------------------
Net Revenues 100% 2,831 100% 3,653 822 29%
--------------------- ---------------------
Cost of services 43% 1,219 43% 1,576 357 29%
Handset Subsidy 8% 221 17% 634 412 186%
--------------------- ---------------------
Total Cost 51% 1,440 60% 2,210 769 53%
--------------------- ---------------------
Gross Profit 49% 1,391 40% 1,443 53 4%
--------------------- ---------------------
Operating Expenses 29% 808 24% 870 62 8%
Depreciation and Amortization 28% 793 21% 774 (19) (2)%
--------------------- ---------------------
Total Expenses 57% 1,601 45% 1,644 43 3%
--------------------- ---------------------
Operating Loss (7)% (211) (5)% (201) 10 5%
--------------------- ---------------------
Operating Profit before Depreciation
and Amortization 21% 583 16% 573 (9) (2)%
--------------------- ---------------------
Loss from sale of fixed assets and
other expenses (1)% (24) 5% 165 189 n.m.
Comprehensive Financing Cost
Interest Expense - Net (20)% (556) (16)% (594) (38) (7)%
Exchange gain (loss) 14% 405 (21)% (755) (1,160) (287)%
Gain from net monetary position 1% 36 1% 27 (9) (24)%
--------------------- ---------------------
(4)% (115) (36)% (1,321) (1,207) (n.m.)
--------------------- ---------------------
Loss before taxes (24)% (349) (37)% (1,357) (1,008) (288)%
--------------------- ---------------------
Tax Provisions (2)% (58) (0)% (1) 57 98%
Equity in income (loss) of 0% - (0)% (0) (0) (n.m.)
subsidiaries
Minority interest (0)% (1) 0% 3 5 n.m.
--------------------- --------------------- ---------------------
Net loss (14)% (409) (37)% (1,355) (946) (231)%
===================== ===================== =====================
7
GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER
(UNAUDITED FIGURES)
2Q05 2Q06 CHANGE
--------------------- --------------------- ---------------------
Cash and cash equivalents 4 0% 31 0% 27 n.m.
Customers 389 4% 465 4% 76 19%
Due from related parties 96 1% 310 3% 214 224%
Advanced payments and other receivables 314 3% 249 2% (65) (21)%
Unamortized handset subsidy 275 3% 441 4% 166 60%
Inventories 100 1% 42 0% (58) (58)%
--------------------- ---------------------
Current assets 1,177 11% 1,536 14% 359 31%
Fixed assets 6,696 62% 5,843 53% (852) (13)%
Goodwill - Net 1,857 17% 1,862 17% 4 0%
Other assets 1,100 10% 1,772 16% 673 61%
--------------------- ---------------------
Total assets 10,829 100% 11,013 100% 184 2%
--------------------- ---------------------
Short-term debt 8,773 81% 8,945 81% 172 2%
Accrued interest 2,022 19% 2,900 26% 878 43%
--------------------- ---------------------
Short-term liabilities with financial cost 10,795 100% 11,845 108% 1,050 10%
Suppliers 284 3% 436 4% 152 54%
Related parties 220 2% 220 2% 0 0%
Unaccrued air time 165 2% 63 1% (102) (62)%
Accumulated expenses and other payables 949 9% 1,012 9% 64 7%
--------------------- ---------------------
Short-term liabilities without financial
cost 1,617 15% 1,731 16% 114 7%
--------------------- ---------------------
SHORT-TERM LIABILITIES 12,412 115% 13,576 123% 1,164 9%
LONG-TERM LIABILITIES 25 0% - 0% (25) (100)%
Advances from customers - 878 8% 878 100%
--------------------- ---------------------
STOCKHOLDERS' EQUITY (1,608) (15)% (3,441) (31)% (1,833) (114)%
--------------------- ---------------------
LIABILITIES + EQUITY 10,829 100% 11,013 100% 184 2%
--------------------- --------------------- ---------------------
8
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES
FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS
INCOME STATEMENT
---------------------------------------------------------------------
2Q05 2Q06 CHANGE
--------------------- --------------------- ---------------------
Revenue 107% 1,623 105% 2,021 399 25%
Commissions (7)% (100) (5)% (95) 5 5%
--------------------- ---------------------
Net Revenue 100% 1,523 100% 1,927 404 27%
--------------------- ---------------------
Cost of services 41% 629 45% 863 235 37%
Handsets subsidy 9% 143 17% 323 180 n.m.
--------------------- ---------------------
Total Cost 51% 772 62% 1,186 414 54%
--------------------- ---------------------
Gross Profit 49% 751 38% 741 (10) (1)%
--------------------- ---------------------
Operating expenses 25% 382 22% 427 46 12%
Depreciation and amortization 24% 359 18% 341 (18) (5)%
--------------------- ---------------------
Total Expenses 49% 741 40% 769 28 4%
--------------------- ---------------------
Operating Loss 1% 10 (1)% (28) (38) n.m.
--------------------- ---------------------
EBITDA 24% 369 16% 313 (56) 15%
--------------------- ---------------------
(Profit) loss from fixed assets
sales 1% 10 0% 7 (2) n.m.
Integral Financing Cost
Interest expense, net (8)% (124) (8)% (156) (33) (27)%
Foreign exchange loss (gain) 14% 208 (10)% (200) (408) n.m.
Gain from monetary position (1)% (15) (1)% (26) (11) (75)%
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5% 70 (20)% (382) (452) n.m.
--------------------- ---------------------
Loss Before Taxes 6% 90 (21)% (402) (492) n.m.
--------------------- ---------------------
Taxes (3)% (44) (6)% (111) (67) n.m.
Equity participation in net loss
(income) of subsidiaries 0% - 0% - - n.a.
Extraordinary item 0% - 0% - - n.a.
Minority interest (0)% (3) 0% 2 5 180%
--------------------- --------------------- ---------------------
Net Profit (Loss) 3% 43 (27)% (511) (554) n.a.
===================== ===================== =====================
9
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES
FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS
INCOME STATEMENT
---------------------------------------------------------------------
6M05 6M06 CHANGE
--------------------- --------------------- ---------------------
Revenue 107% 3,121 105% 3,999 878 28%
Commissions (7)% (204) (5)% (206) (2) (1)%
--------------------- ---------------------
Net Revenue 100% 2,917 100% 3,793 876 30%
--------------------- ---------------------
Cost of services 47% 1,372 45% 1,701 329 24%
Handsets subsidy 8% 221 17% 634 412 186%
--------------------- ---------------------
Total Cost 55% 1,593 62% 2,335 741 47%
--------------------- ---------------------
Gross Profit 45% 1,323 38% 1,459 135 10%
--------------------- ---------------------
Operating expenses 27% 795 22% 852 56 7%
Depreciation and amortization 25% 718 18% 698 (19) (3)%
--------------------- ---------------------
Total Expenses 52% 1,513 41% 1,550 37 2%
--------------------- ---------------------
Operating Loss (6)% (189) (2)% (91) 98 52%
--------------------- ---------------------
EBITDA 18% 528 16% 607 79 15%
--------------------- ---------------------
(Profit) loss from fixed assets
sales (1)% (24) 4% 162 186 n.m.
Integral Financing Cost
Interest expense, net (8)% (237) (8)% (296) (59) (25)%
Foreign exchange loss (gain) 7% 198 (9)% (356) (555) n.m.
Gain from monetary position 1% 21 0% 12 (9) (43)%
--------------------- ---------------------
(1)% (17) (17)% (640) (623) n.m.
--------------------- ---------------------
Loss Before Taxes (8)% (230) (15)% (570) (339) (147)%
--------------------- ---------------------
Taxes (2)% (58) (3)% (111) (53) n.m.
Equity participation in net loss
(income) of subsidiaries 0% - 0% - - n.a.
Extraordinary item 0% - 0% - - n.a.
Minority interest (0)% (1) 0% 3 5 n.m.
--------------------- --------------------- ---------------------
Net Loss (10)% (289) (18)% (677) (388) (134)%
===================== ===================== =====================
10
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES
FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS
6M05 6M06 CHANGE
--------------------- --------------------- ---------------------
Cash and marketable securities 3 0% 11 0% 9 n.a.
Accounts receivable, net 388 4% 467 5% 79 20%
Unamortized handset subsidy 275 3% 441 4% 166 60%
Related parties 347 4% 705 7% 358 103%
Recoverable taxes and other 260 3% 207 2% (53) (20)%
Inventories 100 1% 42 0% (58) (58)%
--------------------- ---------------------
TOTAL CURRENT ASSETS 1,371 14% 1,872 19% 501 37%
Property and equipment, net 6,164 64% 5,226 53% (938) (15)%
Excess of cost of investments in
subsidiaries over book value, net 1,672 17% 1,672 17% (0) (0)%
Other assets 435 5% 1,152 12% 716 165%
--------------------- ---------------------
TOTAL ASSETS 9,641 100% 9,920 100% 279 3%
--------------------- ---------------------
Short-term debt 4,602 48% 4,692 47% 90 2%
Accrued interest 466 5% 713 7% 247 53%
Short-term liabilities with
financial cost 5,068 53% 5,405 54% 337 7%
Accrued liabilities 718 7% 593 6% (125) (17)%
Related parties 221 2% 699 7% 478 217%
Accounts payable 256 3% 129 1% (127) (50)%
Unaccrued air time 165 2% 63 1% (102) (62)%
--------------------- ---------------------
Short-term liabilities without
financial cost 1,360 14% 1,484 15% 124 9%
SHORT-TERM LIABILITIES 6,428 67% 6,890 69% 462 7%
LONG-TERM LIABILITIES 0 0% - 0% (0) (100)%
Advances from customers 878 9% 878 n.a.
--------------------- ---------------------
Minority interest (81) (1)% (74) (1)% 7 (9)%
TOTAL SHAREHOLDERS' EQUITY 3,294 34% 2,226 22% (1,067) (32)%
--------------------- ---------------------
TOTAL LIABILITIES AND
SHAREHOLDERS'S EQUITY 9,641 100% 9,920 100% 279 3%
--------------------- --------------------- ---------------------
11
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GRUPO IUSACELL, S.A. DE C.V.
Date: July 28, 2006
/s/ Fernando Cabrera
---------------------------
Name: Fernando Cabrera
Title: Attorney in fact
/s/ Jose Luis Riera
---------------------------
Name: Jose Luis Riera
Title: Attorney in fact
12