Slide 1: Quarterly Results January–September 2007
Quarterly Results January — September 2007 TELEFONKA S.A. November 12%, 2007 ‘This presentation is being broadcast live on the Internet
Slide 2: Disclaimer
Disclaimer This dacument contains statements that constitute forward looking statements in its general meaning and within the meaning of the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places in this document and include staternents regarding the intent,
Slide 3: 9M07 financial highlights: Strong organic growth
GROUP FINANCIALS 9M07 financial highlights: Strong organic growth... in millions 9Mo7 9Mo6 = % Change (6 change yo-y) 2007 2006 —9Mo7/9Mo6 Revenues 42,014 38,704 }+8.69, Operating Income before D&A 18,248 14,654 |+24.5%| (O1BDA) Operating Income 11,263 7,460 [452.0% (ol) Net Income 7.848 5,198 }+51.
Slide 4: Turning into a solid growth in EPS
GROUP FINANCIALS ..turning into a solid growth in EPS... (erangey-oy) 424.5% +51.0% +51.0% Te1p mlov's PPA) 117 m (T102 CR's FPA) 11,263 107 i) (756%) 2095 (48.6%) EPS growth fing) THEFONCAS.A, Investor Relations
Slide 5: Leveraged customer growth and diversification
GROUP FINANCIALS: ..as we leveraged our customer growth and diversification... fecesses ) Accesses by regions Accesses by business (Sep-o7/Sep06) ay ay, (sep-07/5ep06) 59.0% et aes 132% 29% 1959 50% sas2% Sepp Sepa? T.espafia T.O2Europe T.Latam Mobile Broadband = PayTV. 9Mo7 Revenue breakdown 9Mo7 R
Slide 6: Benefit of scale fostering profitability
GROUP FINANCIALS: ..with the benefit of our scale fostering profitability... OpEx Organic Growth Organic? OIBDA Margin Evolution 412.2% 37.5% 35.8% 372% 47.4% Fl 2005 2008 907 908 HO? 907 9Mo7 Organic OIBDA Margin 47.8% Tespaia Tilatam — TO2 Europe Group He oe ee ee ee Thee ene emadteentemnay pene T
Slide 7: Telefónica España: delivering sound results
TELEFONICA ESPANA Telefénica Espafia: delivering sound results Revenues OIBDA and Underlying OIBDA *! (€in millions} (€in millions} ES ae 14,720 15,462 6,863 7,384 a 1 Underiying | o1BDA grewth® | 10s 907 10s 907 = Over 45 million accesses, posting a (+5.3%) y-o-y growth = Wireline: Broadband growth
Slide 8: Wireline Business: TEF leads Broadband and Pay-TV growth
TELEFONICA ESPANA WIRELINE BUSINESS Wireline Business: TEF leads Broadband and Pay-TV growth... Fixed Telephony Accesses Retail Internet BE Accesses Pay TV subscribers a Pansy (in thousands) 15,978 15.865 4344 be = M —_- om ——s = Maintaining interanual loss = Increasing market share rateat record lo
Slide 9: Wireline Business: superior top line growth
TELEFONICA ESPANA od ‘ A . WIRELINE BUSINESS Wireline Business: superior top line growth Revenue evolution (% change 9M07/9M06) 416.8% +8.8% 43.7% “12% Traditional Internet Data & IT TOTAL WIRELINE Acces &Voice — Eradband BUSINESS = Expanding BB customer base ¥ 49% of Spanish households with fixed l
Slide 10: Wireline Business: operational efficiency and margin improvement
TELEFONICA ESPANA od ‘ . WIRELINE BUSINESS Wireline Business: strong focus on operational efficiency leading to margin improvement OIBDA Growth 03 07/0306 sas pp. #5:6% 04% reported HighereRE. Subsidies Real yadertyin prowsion ing G7 Estate program Indertying, OIBDA Growth 9M07/9M06 +7.9% App. Repor
Slide 11: Wireless Business: significant growth in Q3 07 focused on value
TELEFONICA ESPANA WIRELESS BUSINESS Wireless Business: significant growth in Q3 07 focused on value Gross Adds churn Number Portabi Netadds (in thousands) (%) (in thousands) (in thousands) S610 n 335342 if int | ai | 305 0307 0308-0307 (0308 0307 0305 0307 Netadds Customer growth {in thousands) row)
Slide 12: Wireless Business: sustained ARPU on strong voice & data usage
Wireless Business: sustained ARPU on strong voice & data usage 93.07/03 06 (y-0+ growth rates) INCOMING VOKE TELEFONICA ESPANA WIRELESS BUSINESS eS ARPUGrowth Neliaiaianibes TOTAL APU © Data traffic: x9 (03 07 vs. 03 06); 2.4 (03 O7 vs. 0207), USAGE GROWTH DRIVERS. Outgoing data ARPU growth 3G over
Slide 13: Wireless Business: strong top line growth while improving efficiency
Wireless Business: strong top line growth while improving efficiency TELEFONICA ESPANA WIRELESS BUSINESS Revenues Handset Revenues Service Revenues Customer revenues 47.2% +8.8% Interconnection revenues “11.8% “7.8% Roaming-in revenues “11.7% 113.8% OIBDA yoy growth (in mitions) @& OBOE margin 16.9%
Slide 14: Telefónica Latinoamérica: robust access growth
TELEFONICA LATAM Telefénica Latinoamérica: robust access growth fully flowing to top line and OIBDA growth tect cing sep-07 Accesses Revenues o1BDA (inmillions} yoymonth in millions} (€in millions} 41 80 413.8% +14.5% Mobile BB Pay 10s mo? 10s mor = Strong increase in mobile penetration (+12 p.p. vs
Slide 15: Healthy growth in revenues and OIBDA in all major markets
TELEFONICA LATAM Healthy growth in revenues and OIBDA in all major markets ete Eccuding PSICOFINS impact Revenues = Brazil? 5,637 4% CA = Argenti 1,678 +16.6% 605 +16.6% = Chile 1319 +12.3% 514 +10.3% = Pen 1,126 +11.2% 415 -1.9% = Colombia? 1,138 431.1% 328 +59.8% = Venezuela 1,716 +27.9% 756 +41.0
Slide 16: Accelerating fixed transformation: bundles, broadband and Pay TV
TELEFONICA LATAM Accelerating fixed transformation by fostering BONNE bundles, broadband and Pay TV Retail Internet BE connections! Pay TV clients {in thousands} 3 ¥ {in thousands) anal, 574 © 77,600 clients in Peru © 46,200 clients in Colombia © Recent launch in Brazil Breakdown of retail BE connec
Slide 17: Brazil wireless: strong commercial activity
Brazil wireless: strong commercial activity along with robust top line and enhanced profitability 9Mo7/9Mo6 change <> TIKOF adds in GSM. Gross Churn Net Customers. © Strongest distribution Adds ‘Adds channel 9Mo7/9M06 growth {in tocal currency} 424.2% 418.9% 417.8% Service uEgOINE O10 Revenues Servi
Slide 18: Mexico wireless: strong performance in a competitive market
TELEFONICA LATAM . . . (MEXICO Mexico wireless: strong and sustained performance in a highly competitive market Gross adds Net adds Blended churn Customer growth {in thousands) {in thousands) (76) row) 4,972 wo 28 fs t 3,335 2,519 +$49% 450% 427% 1075 || Sas 9M07 ewas —9uo7 “0308 0107 9207 0307 Tala
Slide 19: Key highlights for other Latam mobile operations
TELEFONICA LATAM —_ . . REST OF MOBILE Key highlights for other Latam mobile operations Sep-07 customer | 2MO7/9M06 a 9Mo7 O1BDA @ yorsroean service revenue | outgoing service base (million) nargi revenue growth? ARGENTINA : | Strong customer growth fuly flows into service revenue backed by {robust
Slide 20: Telefónica O2 Europe: maintaining momentum
TELEF Telefénica O2 Europe: maintaining momentum and positioned to exploit opportunities as an integrated operator Revenues! OIBDAt OIBDA Margin‘ (€in millions} (€in millions} (%) 2,798 2,855 since sonar since sonar since sonar = UK: managing growth / margin balance = Germany: segmented approach to
Slide 21: O2 UK: managing growth / margin balance
TELEFONICA O2 EUROPE O2 UK: managing growth / margin balance “ Mobile customer growth ARPU Revenues (yoy) (ing) (onganict, £ in millions) as ae" i SBS” 3,393 ent 43.2% 234 Tost contact Bo oor 08 wor MoUF:+40.3% yo-yto 493 minutes © Data ARPU+3.2% y-0-yt07.5 (non SMSdata +20.6%) Contract churn (6) OI
Slide 22: 9M07 synergies very close to annual guidance
GROUP SYNERGIES 9M07 synergies very close to annual guidance ‘pcr M07 from synergi (ein mitions) ns 182 @ % comerage 9007/2007 Guidance THEFONCAS.A gjotou-capm ‘COMMERCIAL F-M INTEGRATION (P&<S + Channels) ‘TO.S)INTEGRATION(F-M + Combination of 2are3s) rouroce smc ea Ay aan ‘sumroscee FEES epee SRE
Slide 23: Stable financial profile
GROUP FINANCIAL EXPENSES Stable financial profile 9Mo7 up — eur Net Interest Expenses (2,095) mm Total Average Debt 51,939 Effective Intarast rate 5.39% © Slight decrease in the cost of debt vs. H2.07 (-6 b.p.) © Broadly stable liabilities currency mix, with some increase in Czech koruna debt © Stab
Slide 24: De-leverage target achieved
GROUP DEBT De-leverage target achieved ‘9M0o7 Net Financial Debt Evolution {€in millions) “5,959 Netfin.Oebt fcr Commitments _Sharebuyback Natfinandal _Changain Nel, Dsbt Het Fin, Debit Dscoe | Fest, “Garanliation andTskdividends Invastmantsepnsoldation, SP 07 Commitments inariies and-athers Sep-07
Slide 25: Conclusions
Conclusions 4. Strong commercial activity backed on mobile and broadband = Accesses: 218.6 millions (+11.6% y-o-y) = Pushing 2P/3P offers (4.8 millions as of September 07) 2. Solid growth across the board, from top to bottom = Non-stop growth for 14* consecutive quarters in revenues, OIBDA, Ol and n
Slide 26: Signatures
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Telefónica, S.A. Date: November 12 th , 2007 By: /s/ Santiago Fernández Valbuena Name: Santiago Fernánd