Repsol YPF

2Q 2005	1Q 2006	2Q 2006	% Variation 2Q06/ 2Q05	SECOND QUARTER 2006 RESULTS	Jan-Jun 2005	Jan-Jun 2006	% Variation 06/05
REPORTED EARNINGS (Million euro)
1.575	1.604	1.690	7,3	INCOME FROM OPERATIONS	3.041	3.294	8,3
824	862	920	11,7	NET INCOME	1.621	1.782	9,9
PROFORMA INDICATORS (Million euro)
1.565	1.584	1.602	2,4	ADJUSTED OPERATING INCOME	3.048	3.186	4,5
790	844	857	8,5	ADJUSTED NET INCOME	1.575	1.701	8,0
EARNINGS PER SHARE
0,67	0,71	0,75	11,7	Euros per share	1,33	1,46	9,9
0,81	0,86	0,96	18,5	Dollars per share	1,60	1,85	15,6

SECOND QUARTER 2006 HIGHLIGHTS

Net income in the quarter was Eu920 million. Excluding non-recurring items, adjusted net income was 8.5% higher year-on-year. These quarterly results reflect high crude oil prices and a scenario of continually wide refining margins. Base chemical margins still suffered the negative effect of high oil and naphtha prices.

Income from operations in second quarter 2006 was Eu1,690 million. Excluding non-recurring items, adjusted operating income rose 2.4% to Eu1,602 million. EBITDA was Eu2,357 million, up 11.3% year-on-year, and earnings per share were Eu0.75.

Production in the quarter was 1,098,300 boepd, 6.9% less than the 2005 equivalent, mainly because of the migration from operating concessions to mixed companies in Venezuela as of last April, and lower production in Argentina

On 15 June, the Audit and Control Committee presented the conclusions of the independent revision carried out with the assistance of King & Spalding LLP on the reduction of reserves disclosed on 26 January 2006. In this respect, the report concludes that the reserves reduction at year-end 2005 was consistent with the recommendations of the Company’s external reserves auditors, and resulted from, among other things, a disciplined process regarding technical issues and commercialisation requirements. The changes in Bolivian law also played a role in the reductions. In the course of the review, King & Spalding found no reason to doubt the integrity of the process in 2005 and resulting revision in reserves, and no person interviewed claimed that the proved reserves figures for year-end 2005 were overstated..

On 16 June last, Repsol YPF held its Annual General Shareholders Meeting, at which all the resolutions presented were passed, including payment of a final Eu0.30 dividend per share against the 2005 financial year, equivalent to a 20% year-on-year rise, made possible by the company’s good performance. As a result, the total gross dividend against 2005 was Eu0.60 per share.

Repsol YPF has decided to launch its growth project for the Sines Petrochemical Complex over the next few years, involving an investment of over Eu600 million. This investment was contemplated in the 2005-2009 Strategic Plan unveiled in May 2005.