COFINA, S.G.P.S., S.A. Open Capital Company

Head Office: Rua do General Norton de Matos, 68, r/c – Fiscal Number 502 293 225 Share Capital: 25.641.459 Euro

BUSINESS EVOLUTION FOR THE YEAR 2006

After the demerger of its industrial operations in March 2005, Cofina is currently focusing its activity in the media segment, namely daily and non-daily press.

The main changes that took place in the Group during the year 2006 were as follows:

• in July 2006, the Group started the activity of the free distribution newspaper “Destak” in São Paulo, . Cofina and Metro News, company which distributes “Destak” in , jointly hold a minority interest of 30%; • in September 2006 Investec Media, S.G.P.S., S.A. changed its designation to Cofina Media, S.G.P.S., S.A.; • in November 2006 Cofina Media reinforced its shareholding position in Metro News (the holder of the free distribution newspaper “Destak”) by 10%, thus currently holding 59% of the share capital of that company; • in December 2006 the Group sold the financial investment held in Global Notícias, S.G.P.S., S.A. (previously named Lusomundo Media, S.G.P.S., S.A.).

As of December 31, 2006, the Group’s investment structure is as follows:

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Despite the adverse factors experienced during 2006 due to the scarce domestic demand and the slow growth of the Portuguese economy, the Group not only managed to maintain the leadership of its main products, but also reinforced the position of its newsmagazine “Sábado”.

In what relates to paid circulation, Cofina kept the leadership among the main media groups:

Paid circulation Paid circulation Share Share in 2006 in 2005

Cofina Media 64,039,599 27% 65,584,866 27% Global Notícias 54,225,903 23% 58,235,094 24% Impala 30,726,817 13% 30,794,624 13% Impresa 23,673,733 10% 25,423,623 11% Source: APCT Copies sold in the first three quarters of 2006

It is to highlight the performance of the newsmagazine “Sábado”, consistently above the market and its competitors, and currently holding a market share in paid circulation of 34% (towards 30% in 2005), a 12% growth in comparison with previous year, whilst all its direct competitors recorded decreases in its paid circulation.

Paid circulationPaid circulation Paid circulation share 2006 2005evolution 2006 2005 Sábado 55,887 49,932 11.9% 34% 30% Visão 93,761 99,198 -5.5% 57% 60% Focus 15,357 16,908 -9.2% 9% 10% Market 165,005 166,038 -0.6% Source: APCT Average number of copies sold per edition in the first three quarters of 2006

As far as it concerns the advertising market, the Group managed to maintain moderate growth levels on the investments engaged to its publications, presenting once again a performance above its main competitors and achieving an increase in advertising sales share from 19% to 20%.

Advertising Advertising Share Share investment in 2006 investment in 2005

Cofina Media 149,345,713 20% 136,393,278 19% Impresa 131,702,359 18% 124,890,066 18% Global Notícias 125,379,779 17% 129,024,227 18% Impala 54,058,306 7% 53,990,470 8% Source: Mediamonitor (standard prices in Euro)

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CONSOLIDATED FINANCIAL INFORMATION

In 2006 Cofina included for the first time by, the full consolidation method, the companies Grafedisport, printing company which operates mainly for the Group (intercompany sales – 90%) and Metro News, holding company of the free distribution newspaper “Destak” (incorporating in 2006 solely the operations of November and December for this last company).

The consolidated financial information for the year 2006, prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards (IFRS), may be presented as follows:

31.12.2006 31.12.2005 ∆ 2006 / 2005 (a) Operating income 131,325 129,777 1.2% Operating net profit (EBIT) 14,661 13,338 9.9% Net profit of Media and Holding operations (b) 9,687 7,536 28.5% EBITDA of Media and Holding operations 17,779 16,226 9.6% Net profit of discontinued operations (b) -3,031n.a. (amounts in thousand Euro) EBITDA - Operating net profit + Amortisation and depreciation (a) - Operating income, operating net profit and EBITDA corresponding to Media and Holding operations (b) - Net profit attributable to minority interests and to parent company's shareholders n.a . - not applicable

The 2006 operating income reached 131 million Euro (+1%). This performance was impacted by the reduction of the alternative marketing sales, which, nevertheless, was smaller than in preceding periods.

The operating net profit increased approximately 10% in the year ended December 31, 2006 due to the Group’s ability to control its operating costs.

The operating cash-flow for the year 2006 increased approximately 10% to 17.8 million Euro.

The financial net profit was mainly influenced by the appropriation of the losses related with the project of the free distribution newspaper “Penalty” in Spain. Cofina has already sold its position in that project as from December 2006. This negative effect was, however, balanced by the gains obtained in the sale of quoted shares and the financial investment of 19.09% in Global Notícias, S.G.P.S., S.A. (previously named Lusomundo Media, S.G.P.S., S.A.).

The net profit for the year 2006 grew 28.5% on a comparative basis (media and holding operations) amounting to 9.7 million Euro.

The net profit of discontinued operations, presented for the year 2005, refers to the contribution of January and February operations of F. Ramada and Caima Groups prior to the demerger operation, which took place as of March 1, 2005.

The Group’s nominal total debt amounted to 103 million Euro corresponding to a nominal net debt of 21 million Euro (including the investments held for trading).

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In a more detailed level the Group’s performance may be presented as follows:

Dec/2006 Dec/2005 ∆ 2006 / 2005 Operating income 131,325 129,777 1.2% Circulation 57,167 56,296 1.5% Advertising 55,121 52,683 4.6% Alternative marketing products and others 19,037 20,798 -8.5% Operating income by segments 131,325 129,777 1.2% Newspapers 91,633 91,371 0.3% Magazines 39,692 38,406 3.3% Operating expenses (a) 113,546 113,551 0.0% Consolidated EBITDA (b) 17,779 16,226 9.6% EBITDA margin 13.5% 12.5% Newspapers 17,087 15,739 8.6% Newspapers EBITDA margin 18.6% 17.2% Magazines 692 487 42.1% Magazines EBITDA margin 1.7% 1.3% Amortisation and depreciation 3,118 2,888 8.0% EBIT (c) 14,661 13,338 9.9% EBIT margin 11.2% 10.3% Financial net profit (1,765) (3,513) 49.8% Current profit 12,896 9,825 31.3% Current profit margin 9.8% 7.6% Income before taxes and minority interests 12,896 9,825 31.3% Income taxes 3,194 2,235 42.9% Minority interests 15 54 -72.2% Net consolidated profit 9,687 7,536 28.5% (amounts in thousand Euro) (a) Operating expenses excluding amortisation (b) EBITDA - Operating net profit + Amortisation and depreciation (c) EBIT (operating net profit)

The operating income globally achieved 131.3 million Euro, presenting a slight increase of around 1% towards 2005, mainly due to the growth of 5% in the advertising income which, given the current context of moderate stagnation in the advertising market, is considered to be quite positive. Circulation income increased slightly when compared with the year 2005, and alternative marketing sales decreased around 8.5% in the same period.

The operating expenses remained stable, thus allowing for a growth in EBITDA of circa 9.6% with the corresponding EBITDA margin amounting to 13.5% (12.5% in 2005).

The operating net profit (EBIT) totalled 14.7 million Euro, an increase of 9.9% in comparison with the previous year.

The consolidated net profit for the year reached 9.7 million Euro, a 28.5% growth towards 2005.

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Newspapers segment

This segment includes the following publications:

• “Correio da Manhã” – daily newspaper; • “” – daily sports newspaper; • “Jornal de Negócios” – daily economics newspaper; • “Destak” – free distribution newspaper (November and December operations).

“Correio da Manhã” kept the leadership of the generalist daily newspapers’ segment, reinforcing its paid circulation share from 33% to 34% in 2006.

Paid circulationPaid circulation Paid circulation share 2006 2005evolution 2006 2005 Correio da Manhã 113,335 115,762 -2.1% 34% 33% Jornal de Notícias 95,562 95,706 -0.2% 29% 27% 24 Horas 42,336 50,753 -16.6% 13% 15% Público 45,472 49,506 -8.1% 14% 14% Diário de Notícias 35,870 37,142 -3.4% 11% 11% Mercado 332,575 348,869 -4.7% Source: APCT Average number of copies sold per edition in the first three quarters of 2006

The newspapers segment information may be presented as follows:

Dec/2006 Dec/2005 ∆ 2006 / 2005 ∆ % 2006 / 2005 Operating income 91,633 91,371 262 0.3% Circulation 41,059 40,805 254 0.6% Advertising 40,123 37,903 2,220 5.9% Alternative marketing products and others 10,451 12,663 (2,212) -17.5% Operating expenses (a) 74,546 75,632 (1,086) -1.4% EBITDA 17,087 15,739 1,348 8.6% EBITDA margin 18.6% 17.2% (amounts in thousand Euro) (a) Operating expenses excluding amortisation

Operating income amounted to 91.6 million Euro representing an increase of 0.3% in comparison with 2005.

The Group’s newspapers performance relating to the advertising sales was quite positive, increasing 5.9% towards 2005, despite the adverse conjuncture felt in the advertising market during 2006. This positive effect was however diminished by the reduction of alternative marketing income as a result of the demand’s decrease.

Nevertheless the Group’s cost-cutting effort led to a decrease in operating expenses of around 1.4%, corresponding to a reduction of 1.1 million Euro.

Operating cash flow totalled 17.1 million Euro, growing 8.6% towards 2005, and the EBITDA margin reached 18.6%, representing an increase of 1.4 percentage points.

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Magazines segment

The magazines segment includes the following titles: • Sábado – news (weekly); • TV Guia – television (weekly); • Flash! – society (weekly); • Máxima – women’s magazine (monthly); • Vogue – fashion (monthly); • Máxima Interiores – interior decoration (monthly); • GQ – men’s magazine (monthly); • Automotor – motor (monthly); • Rotas e Destinos – leisure (monthly); • PC Guia – information technology (monthly); • Semana Informática – information technology (weekly); • VDI – information technology (monthly).

During 2006 the news magazine “Sábado” consolidated and reinforced its position becoming a reference publication in its segment. Its paid circulation share grew 4% and its ratings increased 8%. Advertising sales raised 50%, achieving 9% market share in 2006 (6% in 2005).

“Flash!” magazine managed to increase its paid circulation share from 13% in 2005 to 14% in 2006. During this year the Group promoted a marketing campaign together with this magazine related with the dinnerware Eclipse by Vista Alegre, which achieved great acceptance by the consumers.

Dec/2006 Dec/2005 ∆ 2006 / 2005 ∆ % 2006 / 2005 Operating income 39,692 38,406 1,286 3.3% Circulation 16,108 15,491 617 4.0% Advertising 14,998 14,780 218 1.5% Alternative marketing products and others 8,586 8,135 451 5.5% Operating expenses (a) 39,000 37,919 1,081 2.9% EBITDA 692 487 205 42.1% EBITDA margin 1.7% 1.3% (amounts in thousand Euro) (a) Operating expenses excluding amortisation

The operating income for the year 2006 increased circa 1.3 million Euro (3.3% in comparison with the previous year), presenting the following growth rates: circulation (4%), advertising (1.5%) and alternative marketing (5.5%). The most remarkable raise occurred in alternative marketing presenting a quite positive behaviour, in counter cycle with the market.

As a result of the increase in operating income and the moderate effect of the raise in operating expenses, the cash flow for this segment kept its raising trend, increasing 42% and totalling 692 thousand Euro in the year. EBITDA margin achieved 1.7% in comparison with 1.3% in 2005.

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NON-CONSOLIDATED FINANCIAL INFORMATION

The main indicators of Cofina’s non consolidated financial statements, prepared in accordance with the Portuguese generally accepted accounting principles (Portuguese GAAP), are as follows:

Portuguese GAAP 31.12.2006 31.12.2005 Total assets 390,638 171,412 Total shareholders' equity 84,976 81,923 Net profit for the year 5,617 36,460 (amounts in thousand Euro)

The increase in total assets is the result of the acquisition of 100% of the voting rights of the subsidiary Cofina Media, S.G.P.S., S.A. previously held by IMC – Investimentos, Media e Conteúdos, S.G.P.S., S.A..

The net profit for the year 2005 is highly influenced by the dividends distributed by Celulose do Caima, S.G.P.S., S.A. amounting to 36.7 million Euro (operation included in the restructuring project of the Group which took place in 2005)

The comparison of the shareholders’ equity as of 31 December 2006 and 2005 is affected by the net profit for the year and by the dividends distribution approved in the Annual Shareholders‘ Meeting held March 31, 2006, amounting to 2.6 million Euro.

Porto, March 8, 2007

João Borges de Oliveira Alfredo Portocarrero Director Controller

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