HANA Hanarotelecom Incorporated ADS (MM)

- Revenues and EBITDA increased 21.1% and 22.4% on a year-on-year basis, respectively. SEOUL, South Korea, Aug. 9 /PRNewswire-FirstCall/ -- hanarotelecom incorporated (KOSDAQ: 033630) (NASDAQ:HANA) ("Hanaro" or the "Company"), Korea's leading integrated telecommunications company providing a broad range of broadband Internet and voice services, announced a 21.2% gain in revenues to KRW 428.7 billion and a 22.4% increase in EBITDA to KRW 132.8 billion for the second quarter of 2006. The Company also reported a turnaround in operating profit, which rose to KRW 7.5 billion from the negative level of the second quarter of 2005, as well as lower net loss. The Company commented that these results were attributable to the synergy effects from the merger with Thrunet and the strenuous efforts for overhead reduction. The Company stressed that it achieved the EBITDA margin of 31% as previously projected due to the synergy effects and its cost reduction efforts, despite a 15.5% rise in marketing expenses driven by aggressive sales activities amid fierce competition in the broadband market. (Refer to Table - 2Q 2006 Financial Highlights) Such active marketing has led to a broadband net addition of about 30,000 subscribers in the second quarter, a turnaround from net decrease in the previous quarter. Meanwhile, the number of voice subscribers has continued to grow by around 20,000 net subscribers per month on average. In order to offer high-quality services, the Company expanded the 100Mbps optical LAN coverage to 3.2 million households, which accounts for 60% of its apartment DSL coverage. Furthermore, the Company achieved the largest net addition in the second quarter, accounting for 55% of total net addition in the optical LAN market. With increasing cash on hand and continuous debt repayment backed by strong cash flow, the Company's debt level in the second quarter fell below KRW 900 billion for the first time, and the net debt-to-equity ratio decreased to 45.1%, which contributed to a more solid financial structure. Mr. Dominic A. Gomez, Chief Operating Officer, said, "With the launch of hanaTV, which enables subscribers to enjoy various content with high-quality picture and sound at their convenience, we will be able to offer full-blown TPS (Triple Play Service) bundling TV-Portal with broadband and voice services in the second half of this year. We will be able to strengthen customer retention, secure a new growth engine by advancing into the media business and thus transform into an integrated multimedia company." He also said, "hanaTV was off to a good start, acquiring nearly 2,000 new subscribers each day and a total of about 30,000 subscribers after the commercial launch. We are likely to meet our target of attracting 250,000 subscribers by the end of 2006." Table - 2Q 2006 Financial Highlights (Unit: KRW billion) 2Q 2006 1Q 2006 Change 2Q 2005 Change (q-q) note 1) (y-y) Revenues 428.7 432.3 -0.8% 353.9 21.2% Operating Turned Profit 7.5 16.0 -53.2% -3.4 positive Net Income -16.2 -6.1 N/A -33.2 N/A EBITDA 132.8 142.8 -7.0% 108.5 22.4% Note 1) Figures for 2005 are on a stand-alone basis (excluding Thrunet's figures). Contacts: hanarotelecom incorporated Investor Relations 822-6266-4524 / 4473 - or - Taylor Rafferty, New York Rebecca Lohse 1-212-889-4350 Taylor Rafferty, London Erin Gordon 44-20-7936-0400 DATASOURCE: hanarotelecom incorporated CONTACT: hanarotelecom incorporated Investor Relations, +822-6266-4524, +822-6266-4473, ; or Taylor Rafferty, New York, Rebecca Lohse, +1-212-889-4350, or Taylor Rafferty, London, Erin Gordon, +44-20-7936-0400,

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