ČESKÝ TELECOM’S BOARD OF DIRECTORS INTENDS TO PROPOSE A DIVIDEND PAYMENT OF CZK 45 PER SHARE

23.2.2006

The Board of Directors of ČESKÝ TELECOM intends to propose at the Annual General Meeting which is to be held at the end of April 2006 a dividend payment of CZK 45 per share, i.e. total amount of CZK 14,494,046 thousand with the payment in the second half of 2006. This represents the distribution of the full 2005 net profit and retained earnings of the previous periods. This proposal reflects the situation where no dividends were distributed for the previous financial year and the Company’s generation of profit and strong free cash.

Martin Zabka
Spokesperson

ČESKÝ TELECOM, a. s., member of the Telefónica Group is the leading telecommunications company in the Czech Republic. Through its subsidiary company Eurotel Praha, spol. s r.o., it also has a significant presence in the Czech mobile services market. Further information about the firm and the services it offers is available at www.telecom.cz, which was rated as BestWeb 2003 in the WebTop100 survey.

Signum Temporis has consistently awarded ČESKÝ TELECOM for being one of the domestic capital market\'s most transparent firms in terms of providing information. Based on an open vote of specialists, members of the press and a nine-member committee, ČESKÝ TELECOM placed first in 2003, just as it did in 2001.

ČESKÝ TELECOM ranks among the most prominent firms on the Czech capital market in terms of capitalization and trading volumes. Its shares are also traded on the London Stock Exchange in the form of GDRs. ČESKÝ TELECOM\'s credit rating is the highest a Czech corporation can receive from top international rating agencies.

About Telefónica

Telefónica is one of the largest telecommunications companies in the world in terms of market capitalisation. Its activities are centered mainly on the fixed and mobile telephony businesses with broadband as the key tool for the development of both.

The company has a significant presence in 19 countries and a customer base that amounts more than 180 million accesses around the world. Telefónica has a strong presence in Latin America, where the company focuses an important part of its growth strategy.

Telefónica is a 100% listed company, with more than 1.5 million direct shareholders. Its share capital currently comprises 4,921,130,397 ordinary shares traded on the Spanish Stock Market (Madrid, Barcelona, Bilbao and Valencia) and on those in London, Paris, Frankfurt, Tokyo, New York, Lima, Buenos Aires and São Paulo.