1. 75 YEARS OF PROVIDING COMMUNICATIONS SOLUTIONS TO ALL FILIPINOS Philippine Long Distance Telephone Company Presentation to Investors and Analysts Financial and Operating Results First Quarter 2004 May 4, 2004

2. 1.Financial and Operating Results Three Months Ending March 2004 1

3. 2 PLDT Group: Reaching New Levels PLDT Group’s strategy to continue growing its cellular business, deleverage and improve operating efficiencies of its fixed line business while maximizing opportunities for its ICT business, allowed the Group to deliver robust financial results Consolidated revenues up 19% to P27.1 billion (1Q03: P22.7 billion) and EBITDA increased 28% to P16.3 billion (1Q03: P12.8 billion) as EBITDA margins reached 60% Consolidated net income grew 111% to P5.2 billion in 1Q04 (1Q03: P2.5 billion) driven by higher earnings of Smart and increased contribution from PLDT Fixed Line and ePLDT (1)EBITDA without deducting MRP-related costs, other non-recurring charges booked in 2003 Consolidated Revenues and EBITDA (1) Consolidated Net Income Billion Pesos % Margin 56%55%58%64% 60%

4. 3 First Quarter 2004: Financial Highlights PLDT Group’s financial results demonstrate the Group’s commitment to increase earnings and improve cash flows for debt reduction.

5. 4 PLDT Group: Maximizing Cash Flows Capex Consolidated Free Cash Flow Billion Pesos Consolidated capex spending in 1Q04 of P4.3 billion was mainly due to the continued expansion of Smart’s GSM network Consolidated free cash flow in 1Q04 reached P9.3 billion due mainly to the continued strong cash flow generation from Smart and PLDT Fixed Line Free cash flow has been utilized to reduce debt by approximately US$75 million in 1Q04 Smart will pay cash dividends of P11.3 billion to PLDT in the second quarter of 2004, representing 70% of Smart’s net income in 2003 Billion Pesos Consolidated Capital Expenditures

6. 2. Cellular 5

7. 6 Smart: First Quarter 2004 Financial Highlights Smart’s robust performance remains anchored on its strategy of tailoring innovative products for various market segments to grow its subscriber base while efficiently managing costs and cash flows.

8. 7 Smart: Capitalizing on Positive Momentum Smart and Talk ‘N Text, together, added over 1.4 million subscribers in 1Q04 – setting a new historic high for the group Smart’s network had 14.4 million system-wide subscribers as at 1Q04, representing an estimated market share of 45% for Smart and 13% for Talk ‘N Text Approximately 85% of Smart Buddy subscribers were using Smart Load as their reloading mechanism, accounting for about 59% of reload sales values Smart and Talk ‘N Text Subscribers Millions Systemwide Subscribers as of March 31, 2004: Prepaid = 14,090,343 (98%) Postpaid = 265,843 (2%) Smart and Talk ‘N Text Quarterly Net Additions In Thousands Total Net Additions 1Q04: Prepaid = 1,392,123 Postpaid = 16,866

9. 8 Smart: Translating Growth into Profitability Growth in subscribers has translated to 37% year-on-year increase in revenues to P14.7 billion (1Q03: P10.7 billion) while cash operating expenses grew by a lesser 8% to P4.7 billion (1Q03: P4.4 billion) EBITDA grew significantly to P9.7 billion (1Q03: P6.1 billion) as margins improved to 66% (1Q03: 57%) Net income reached P5.2 billion, an 86% improvement year-on-year (1Q03: P2.8 billion) Smart’s results demonstrate that increased revenues derived from a growing subscriber base coupled with controlled variable costs will result in a healthy bottom line Smart – Revenues and EBITDA Smart - Net Income Billion Pesos

10. 9 Smart: Balancing ARPU and SACs Prepaid ARPU decline was complemented by a more significant decline in prepaid subscriber acquisition cost, improving payback period to 1.2 months in 1Q04 (1Q03: 1.7 months ) Based on current blended ARPU and subscriber acquisition costs, payback period has been reduced to 1.7 months compared to 2.5 months in 1Q03 Smart - Prepaid ARPU (Net) and SACs Pesos Payback Period 1.71.81.81.31.2 Smart - Prepaid and Postpaid ARPU (Gross) Pesos

11. 10 Smart: Building for the Next Wave Capex spending 1Q04 stood at P3.5 billion versus full year estimate of approximately P15 billion Smart’s network currently consists of 32 switching centers and over 4,200 base stations covering 92% of the country’s total population Free cash flow remained strong at P4.2 billion (1Q03: P4.4 billion) and was used to pay down debts of US$25 million and increase its cash balance to P15.3 billion Smart will pay cash dividends of P11.3 billion to PLDT in the second quarter of 2004 Smart - Free Cash Flow* * Cash flow available for principal repayments and dividends Smart - Capital Expenditures Billion Pesos

12. 3. Fixed Line 11

13. 12 PLDT Fixed Line: First Quarter 2004 Financial Highlights (1)EBITDA in 2003 is presented without deducting MRP-related costs and other non-cash provisions (2)Cash flow from operations, including changes in working capital less tax payments, capex, investments, interest paid and dividends paid plus dividends received (3)Adjusted EBITDA represents EBITDA over the last twelve months including dividends from Smart of P6.2 billion paid in 2Q03 and 4Q03 PLDT Fixed Line remains focused on maintaining the stability of its revenues while rationalizing expenditures, improving operating efficiencies and reducing debt.

14. 13 Fixed Line: Staying the Course Fixed Line revenues increased by 3% to P11.6 billion (1Q03: P11.3 billion) mainly due to positive impact of rate and interconnect changes on ILD and NLD revenues EBITDA improved to P6.7 billion (1Q03: P6.3 billion) as the increase in revenues were further enhanced by a 2% decline in cash operating expenses; EBITDA margin increased to 58% (1Q03: 56%) Fixed Line operating results highlight the benefits of the manpower reduction program implemented in 2003 Parent Revenues Parent EBITDA (1) Billion Pesos 53%56% Margin (2) 56% 51% 58% (1)EBITDA including dividends from Smart without deducting MRP-related costs and other non-recurring charges booked in 2003 (2)EBITDA margin excluding dividends from Smart 46% 25% 14% 12% 46% 25% 15% 12% 45% 27% 13% 44% 28% 14% 12% 44% 26% 15% 12%

15. 14 Fixed Line: Increasing Free Cash Flow for Debt Reduction PLDT incurred capital expenditures of P797 million in 1Q04 versus full year estimate of P6 - 7 billion PLDT’s free cash flow increased by 256% to P5.3 billion (1Q03: P1.5 billion) on account of higher revenues, lower cash operating expenses and a positive change in working capital PLDT reduced total debts by US$40 million for 1Q04 and had in place transactional hedges covering 40% of its total debt (4% of total debt is denominated in Pesos) PLDT – Capex and Free Cash Flow * Billion Pesos * Cash flow from operations less tax payments, capex, investments, interest paid, dividends paid, plus dividends received Million US$ Million US$ PLDT Debt Maturity Profile* Actual net debt repayment for 2002 and 2003 * After taking into account impact of undrawn committed long-term facilities amounting to US$70MM as of YE03 * $250

16. 4. Information and Communications Technology: ePLDT 15

17. 16 ePLDT: Making Strides ePLDT is in a strong position to enhance its position in the ICT market by maximizing resources and opportunities available to it as the ICT arm of PLDT Group. (1)EBITDA and Recurring net income in 1Q03 is adjusted for non-cash charges amounting to P387 million booked in 1Q03.

18. 5. Recent Developments 17

19. 18 Update on the Piltel Debt Exchange Transaction  Smart grants a final extension of the deadline for Piltel’s creditors to offer to sell their indebtedness to Smart up to May 31. Deadline originally set on April 20, 2004 and subsequently extended to April 30.  Offers received by Smart now exceed 50% but still below the 75% overall threshold and certain individual facility thresholds set by Smart to proceed with the transaction  Smart does not intend to revise the economic terms upon which it would acquire the Piltel debt. Options available to Piltel creditors are:  cash settlement at US$0.40;  US$ Smart debt due December 2007 at the rate of US$0.525, with interest at L+1%;  US$ Smart debt due December 2008 at the rate of US$0.575, with interest at L+1%;  US$ Smart debt due June 2014 at par with fixed interest at 2.25%;  US$ 12-year RoP-guaranteed bonds at par (option not available to Piltel bondholders)

20. 19 PLDT: Delivering on All Fronts Sustaining Earnings Growth Momentum  Smart’s strong performance will continue to drive the earnings of PLDT Group  PLDT-Fixed Line expected to deliver stable earnings  ePLDT to further strengthen operations and generate increased profits Deleveraging to Increase Equity Value  PLDT Group to continue maximizing cash flows for debt reduction  Reduced debt levels will result in higher value accruing to shareholders Restoring Common Dividends in 2005  Growth of Smart and deleveraging of PLDT-Fixed improves the Group’s financial position  PLDT on track to restore dividends to common shareholders by the first half of 2005 Positioning for Further Growth  Identify growth opportunities that capitalize on the individual and combined strengths of the Group’s various businesses

21. Appendix 20

22. 21 Earnings Highlights (In million pesos) * (1)Recurring Net Income and EBITDA in 2003 is presented before deducting MRP-related costs, other non-recurring charges booked in FY03

23. 22 Operating Revenues (In million pesos)

24. 23 Operating Expenses (In million pesos)

25. 24 Cash Flow Highlights (In million pesos)

26. 25 Balance Sheet Highlights (In million pesos) (1)EBITDA before deducting MRP-related costs, other non-recurring charges booked in FY03

27. 26 Smart: Earnings and Cash Flow Highlights (In million pesos)

28. 27 Smart: Balance Sheet Highlights (In million pesos)