AMÉRICA MÓVIL is the leading provider of wireless services in Latin America and one of the five largest in the world in terms of equity subscribers. It has operations in fifteen coun- tries, covering a combined population of over 750 million people. State-of-the-art products and quality services are available for almost 125 million people that make up América Móvil’s subscriber base and three million fixed lines in Central America and the Caribbean. Commit- ment to the region, proximity to its clients and an ability to take advantage of the opportunities it encounters will allow América Móvil to continue to deliver on revenues and profit growth. Corporate Offices Lago Alberto 366 • Col. Anáhuac Mexico, D.F. • C.P. 11320 América Móvil 2006 Annual Report CONTENTS Powerful Performance 3 / Long Lasting, Dependable Energy 6 / Maximum Capacity, Always on Hand 10 / Our Company at a Glance 14 / Letter to Our Shareholders 16 / Operating Review / América Móvil 18 / Mexico 19 / Brazil 20 / Mercosur 20 / Andean 21 / Central America 21 / United States 22 / Caribbean 22 / Board Members and Directory 23 / CEO’s Report to the Board of Directors 24 / Opinion and Reports of the Board of Directors to the Shareholders’ Meeting 27 / Report of the Audit Committee 29 / Financial Summary 31 / Consolidated Financial Statements 32 AMÉRICA MÓVIL is the leading provider of wireless services in Latin America and one of the five largest in the world in terms of equity subscribers. It has operations in fifteen coun- tries, covering a combined population of over 750 million people. State-of-the-art products and quality services are available for almost 125 million people that make up América Móvil’s subscriber base and three million fixed lines in Central America and the Caribbean. Commit- ment to the region, proximity to its clients and an ability to take advantage of the opportunities it encounters will allow América Móvil to continue to deliver on revenues and profit growth. Corporate Offices Lago Alberto 366 • Col. Anáhuac Mexico, D.F. • C.P. 11320 América Móvil 2006 Annual Report CONTENTS Powerful Performance 3 / Long Lasting, Dependable Energy 6 / Maximum Capacity, Always on Hand 10 / Our Company at a Glance 14 / Letter to Our Shareholders 16 / Operating Review / América Móvil 18 / Mexico 19 / Brazil 20 / Mercosur 20 / Andean 21 / Central America 21 / United States 22 / Caribbean 22 / Board Members and Directory 23 / CEO’s Report to the Board of Directors 24 / Opinion and Reports of the Board of Directors to the Shareholders’ Meeting 27 / Report of the Audit Committee 29 / Financial Summary 31 / Consolidated Financial Statements 32 he very rapid pace of subscriber growth that América Móvil faced through- out our first five years of existence had taken our subscriber base to 93 million by the end of 2005, more than nine times the number of subscrib- Ters we had been born with at the time of our spin-off from Telmex. This required an exceptional undertaking by the company. We entered new markets, ex- panded both coverage and capacity everywhere, and adopted new technologies, putting together a common technological platform for voice and data services in Latin America. And we provided the commercial impetus required to drive subscriber growth. These efforts were costly in relation to the size of our operations. But as revenue growth followed subscriber growth, we gradually gained scale. And in so doing our process of expansion became less taxing in relative terms. Hence, whereas in 2006 we gained roughly as many subscribers as the year before (approximately 30 million), our EBITDA margins actually improved by 6.5 per- centage points. Thanks in large part to our efforts, today more than one out of two persons in Latin America has a wireless phone. And in the process, we built for our shareholders a company with world-class scale, a rapidly growing cash flow and a healthy bal- ance sheet that continues to face strong subscriber growth in the region where we operate and which is well positioned to capitalize on the opportunities that may arise in the future. 1 Our company is financially strong and well positioned to capture the growth RELEVANT FINANCIAL DATA in Latin America and to take advantage of the Shareholder Information opportunities in the future. Corporate Offices Shares traded in Mexico Depository agent in the US Lago Alberto 366 “A”: Bolsa Mexicana de Valores The Bank of New York Colonia Anáhuac Symbol: AMX A Investor Services 2006 US$ Mexico, D.F. “L”: Bolsa Mexicana de Valores P.O. Box 11258 Data in millions of constant Mexican pesos as of (1) C.P. 11320 Symbol: AMX L Church Street Station December 31, 2006, except for earnings per share. 2006 2005 Var.% Millions New York, NY 10286-1258 Investor relations Shares traded in the US Toll Free Tel # for domestic callers: Total Revenues 234,222 189,530 23.6% 21,526 Contact: Daniela Lecuona ADS: New York Stock Exchange 1-888-BNY-ADRs [email protected] Symbol: AMX www.stockbny.com Lago Alberto 366 One ADS represents Contact: nd EBITDA 86,290 57,513 50.0% 7,930 Telcel I, 2 floor 20 “L” shares Natalia Castillo Colonia Anáhuac ADS: NASDAQ REVENUES Mexico, D.F. Symbol: AMOV LATIBEX liaison EBITDA Margin 36.8% 30.3% 36.8% C.P. 11320 One ADS represents Santander Investment Services, S.A. Tel.: 52 (55) 2581 4449 20 “A” shares Ave. De Cantabria s/n Fax: 52 (55) 2581 4422 28660 Boadilla del Monte Operating Profit 59,158 35,388 67.2% 5,437 www.americamovil.com Shares traded in Spain Madrid, España “L”: LATIBEX. Mercado de Valores Tel: 34 (91) 289 39 43 Latinoamericanos Fax: 34 (91) 257 10 26 Operating Margin 25.3% 18.7% 25.3% en Euros (billions of constant 05 190 Symbol: XAMXL Independent Auditors Mexican pesos as of Mancera, S.C. Net Income 42,816 31,858 34.4% 3,935 December 2006) 06 234 A Member Practice of Ernst & Young Global Earnings per Share (EPS, pesos) 1.21 0.89 36.0% 0.11 Earnings per ADR (US dollars) 2.22 1.64 35.4% Total Shareholders’ Equity 109,635 75,093 46.0% 10,076 EBITDA Total Assets 320,699 240,165 33.5% 29,473 Weighted Average of Common Shares Outstanding (millions) 35,459 35,766 -0.9% (billions of constant 05 58 Mexican pesos as of Return on Equity (ROE) 46.4% 46.0% December 2006) 06 86 (1) Figures have been restructured to reflect Amtel’s merger into América Móvil. NET INCOME We determine EBITDA 2006* 2005* as shown in this Operating Income 59,158 35,388 reconciliation: Plus This annual report may contain forward-looking statements that reflect the current views and/or expectations of América Móvil and its management Depreciation 19,060 15,961 with respect to its performance, business and future events. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance, or achievements, and may contain words like “believe”, “anticipate”, “expect”, “envisages”, “will Amortization 8,072 6,164 likely result”, or any other words or phrases of similar meaning. Such statements are subject to a number of risks, uncertainties and assumptions. EBITDA 86,290 57,513 (billions of constant 05 32 We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates Mexican and intentions expressed in this annual report. In no event, neither América Móvil nor any of its subsidiaries, affiliates, directors, officers, agents or * millions of constant Mexican pesos as of December 31, 2006. pesos as of employees shall be liable before any third party (including investors) for any investment or business decision made or action taken in reliance on the December 2006) 06 43 Design: www.signi.com.mx information and statements contained in this annual report or for any consequential, special or similar damages. Our company is financially strong and well positioned to capture the growth RELEVANT FINANCIAL DATA in Latin America and to take advantage of the Shareholder Information opportunities in the future. Corporate Offices Shares traded in Mexico Depository agent in the US Lago Alberto 366 “A”: Bolsa Mexicana de Valores The Bank of New York Colonia Anáhuac Symbol: AMX A Investor Services 2006 US$ Mexico, D.F. “L”: Bolsa Mexicana de Valores P.O. Box 11258 Data in millions of constant Mexican pesos as of (1) C.P. 11320 Symbol: AMX L Church Street Station December 31, 2006, except for earnings per share. 2006 2005 Var.% Millions New York, NY 10286-1258 Investor relations Shares traded in the US Toll Free Tel # for domestic callers: Total Revenues 234,222 189,530 23.6% 21,526 Contact: Daniela Lecuona ADS: New York Stock Exchange 1-888-BNY-ADRs [email protected] Symbol: AMX www.stockbny.com Lago Alberto 366 One ADS represents Contact: nd EBITDA 86,290 57,513 50.0% 7,930 Telcel I, 2 floor 20 “L” shares Natalia Castillo Colonia Anáhuac ADS: NASDAQ REVENUES Mexico, D.F. Symbol: AMOV LATIBEX liaison EBITDA Margin 36.8% 30.3% 36.8% C.P. 11320 One ADS represents Santander Investment Services, S.A. Tel.: 52 (55) 2581 4449 20 “A” shares Ave. De Cantabria s/n Fax: 52 (55) 2581 4422 28660 Boadilla del Monte Operating Profit 59,158 35,388 67.2% 5,437 www.americamovil.com Shares traded in Spain Madrid, España “L”: LATIBEX. Mercado de Valores Tel: 34 (91) 289 39 43 Latinoamericanos Fax: 34 (91) 257 10 26 Operating Margin 25.3% 18.7% 25.3% en Euros (billions of constant 05 190 Symbol: XAMXL Independent Auditors Mexican pesos as of Mancera, S.C.