Homex Reports Strong Growth of 77% in Revenue and 88% in Both Operating Income and EBITDA; Pro Forma Revenue Growth of 24% for 2Q06

CULIACAN, Mexico, July 25 /PRNewswire-FirstCall/ -- Desarrolladora Homex, S.A.B. de C.V. ("Homex" or "the Company") (NYSE: HXM; BMV: HOMEX) today announced results for the second quarter ended June 30, 2006(1).

Highlights - Total revenues increased 76.5% in the second quarter of 2006 to Ps.2.9 billion from Ps.1.6 billion in the second quarter of 2005. - The Company sold a total of 10,603 homes during the second quarter, representing an increase of 88.1% over the second quarter of 2005. Affordable-entry and middle-income unit sales increased 96.1% and 28.0%, respectively, during the quarter. - Operating income increased 87.7% in the second quarter of 2006 to Ps.629.2 million from Ps.335.3 million in the comparable period last year. Operating margin for the quarter was 21.9%. - EBITDA increased 88.4% in the second quarter of 2006 to Ps.689.1 million from Ps.365.8 million in the second quarter of 2005. EBITDA margin for the quarter was 24.0%. - Net income increased 47.9% in the second quarter of 2006 to Ps.335.6 million from Ps.226.8 million in the second quarter of 2005.

"I am excited about Homex's strong performance for the second quarter. The housing market in Mexico remains strong and we continue to focus our resources to take full advantage of these trends," said Gerardo de Nicolas, Chief Executive Officer of Homex. "Through our ability to take advantage of the growing availability of mortgages during the quarter and our introduction of an enhanced product offering, we achieved double-digit top line growth in both our affordable-entry and middle-income segments, as well as improved margins for the quarter."

(1) Unless otherwise noted, all monetary figures are in Mexican pesos and restated as of June 30, 2006 in accordance with Mexican GAAP. The symbols "Ps." and "$" refer to Mexican pesos and "US$" refers to U.S. dollars. The second quarter 2006 financial information is unaudited and is subject to adjustment. Financial and Operating Highlights Thousands of constant pesos as of June 30, 2006, unless otherwise Six-Months indicated % % 2Q06 2Q05 Chg. 2006 2005 Chg. Volume (Homes) 10,603 5,636 88.1% 19,173 10,536 82.0% Revenues $2,867,076 $1,624,174 76.5% $5,152,121 $2,957,163 74.2% Gross profit $ 912,569 $ 496,058 84.0% $1,625,503 $ 919,537 76.8% Operating income $ 629,226 $ 335,289 87.7% $1,136,506 $ 636,477 78.6% Net Interest Expense $ 105,250 $ 45,352 132.1% $ 204,749 $ 75,304 171.9% Net Income $ 335,546 $ 226,801 47.9% $ 568,509 $ 403,689 40.8% EBITDA (a) $ 689,098 $ 365,808 88.4% $1,211,338 $ 680,593 78.0% Gross Margin 31.8% 30.5% 31.6% 31.1% Operating Margin 21.9% 20.6% 22.1% 21.5% EBITDA Margin 24.0% 22.5% 23.5% 23.0% Earnings per share 1.00 0.72 1.68 1.27 Weighted avge. shares outstanding (MM) 335.9 314.1 335.9 314.1 Accounts receivable (as a % of sales) 48.4% 62.5% Accounts receivable (days) period-end 174 223 Inventory turnover (days) period-end 224 252 Inventory (w/o land) turnover (days) period-end 59 98 (a) EBITDA is defined as net income plus depreciation and amortization, net comprehensive financing cost, income tax expense and employee statutory profit sharing expense. The following table sets forth a reconciliation of net income to EBITDA for the second quarter 2006 and 2005. Reconciliation of net income (loss) to EBITDA derived from our Mexican GAAP financial information (Thousands of constant pesos as of June 30, 2006) Three months ended June 30, 2006 2005 Net Income (loss) $335,546 $226,801 Depreciation 27,702 13,645 Net Comprehensive Financing Cost 174,811 29,141 Income Tax Expense 151,574 98,622 Minority Interest -536 -2,400 EBITDA $689,098 $365,808 Pro forma Financial and Operating Highlights

For the convenience of the reader, the Company is including a summary of Pro forma financial highlights that incorporates three months of Beta's results into 2Q05 figures. The Company acquired Beta effective July 1, 2005.

Pro Forma Financial and Operating Highlights Thousands of constant pesos as of June 30, 2006, (unless Six-Months otherwise % % indicated) 2Q06 2Q05 Chg. 2006 2005 Chg. Volume (Homes) 10,603 8,954 18.4% 19,173 16,382 17.0% Revenues $2,867,076 $2,321,255 23.5% $5,152,121 $4,213,129 22.3% Gross profit $ 912,569 $ 674,772 35.2% $1,625,503 $1,257,080 29.3% Operating income $ 629,226 $ 435,748 44.4% $1,136,506 $ 840,351 35.2% Net Interest Expense $ 105,250 $ 108,797 -3.3% $ 204,749 $ 186,051 10.0% Net Income $ 335,546 $ 261,338 28.4% $ 568,509 $ 457,717 24.2% EBITDA $ 689,098 $ 466,017 47.9% $1,211,338 $ 884,427 37.0% Gross Margin 31.8% 29.1% 31.6% 29.8% Operating Margin 21.9% 18.8% 22.1% 19.9% EBITDA Margin 24.0% 20.1% 23.5% 21.0%

All pro forma financial information is unaudited and for the three-month period comparison may not be indicative of the results of operations that actually would have been achieved had Homex acquired Beta at the beginning of the period presented, and do not purport to be indicative of future results.

Operating Results

Homex's reported financial results include the consolidated financial results of Casas Beta (Beta) starting from the date of the acquisition of Beta effective July 1, 2005. The Company's period-to-period financial results are not directly comparable as a result of the inclusion of Beta's results of operations.

Homex operated in 26 cities and 17 states across Mexico as of June 30, 2006.

Sales volumes for the three-month period ended June 30, 2006 totaled 10,603 homes, an 88.1% increase over the same period during the previous year. This gain was primarily driven by a 96.1% increase in affordable entry-level volumes, from 4,975 in the second quarter of 2005 to 9,757 in the second quarter of 2006, which incorporates units sold under the Beta brand from July 1, 2005. A significant contribution to overall volume was also made from the middle-income segment with sales of 846 homes in the quarter, representing a 28.0% increase over the 661 homes in the same period of the prior year. Increased availability of financing from all sources, including INFONAVIT and commercial banks, contributed to the higher sales of affordable entry-level homes.

The Company categorized its products according to the following price ranges:

Current Price Range by Segment Thousands of pesos Low High Affordable-entry $173 $ 399 Middle-income $400 $1,800

The average price during the second quarter for all homes sold was Ps.301 thousand. The average price for affordable entry-level houses increased by 1.9% to Ps.235 thousand in the second quarter of 2006 from Ps.231 thousand in the comparable period of 2005. The average sales price for middle-income homes in the second quarter of 2006 was Ps.603 thousand, a 2.8% increase over the average in the second quarter of 2005.

Average Price Change Thousands of pesos as of June 30, 2006 2Q06 2Q05 2Q06/2Q05 Average Price Affordable-entry $235 $231 1.9% Middle income $603 $587 2.8% Compound average price for all homes $301 $316 -4.8%

Mortgage financing: During the second quarter of 2006, the Company focused its affordable entry-level operations on the Mexican Workers' Housing Fund (INFONAVIT), which represented 73.8% of the mortgages granted to Homex's customers during the quarter. Similar to the first quarter of the year, the competitive nature of INFONAVIT mortgages in the second quarter of 2006 resulted in an increased participation by INFONAVIT in the mix of mortgages for the Company's customers.

The Company continued with its extensive training program for its sales force to rapidly identify and utilize the best available mortgage products for their customers. Homex is able to secure financing for its clients from the best sources, more quickly and on better terms, by having a broad portfolio of mortgage options.

As of June 30, 2006, the Company was securing mortgages from INFONAVIT, the five largest Sofoles and five commercial banks, and FOVISSSTE.

Mortgage Financing by Segment Number of Mortgages Financing Source 2Q 2006 % of Total 2Q 2005 % of Total INFONAVIT 7,822 73.8% 3,596 32.1% SHF & Banks 1,866 17.6% 1,811 63.8% FOVISSSTE 915 8.6% 229 4.1% Total 10,603 100.0% 5,636 100.0%

Diversification: During the second quarter of 2006, Homex consolidated its presence in the 26 existing cities and launched 12 new phases or expansion projects, as well as 3 new middle-income developments in accordance with its strategy of maintaining a geographically diverse base of projects in medium- sized cities, while strengthening its presence in the major metropolitan areas in Mexico.

Homex is one of the leading homebuilders in Mexico's top four markets: Mexico City, Guadalajara, Monterrey and Tijuana and continues to have one of the leading positions in the additional 22 cities where the Company operates.

Financial Results

Revenues increased 76.5% in the second quarter of 2006 to Ps.2,867 million from Ps.1,624 million in the same period of 2005. This result is primarily due to the 96.1% increase in the number of affordable entry-level homes sold, attributable in part to increased availability of financing to this segment, as well as the effects of the Beta acquisition. As a percentage of total revenues, affordable entry-level represented 80.0% in the second quarter of 2006 versus 70.6% in the same period of 2005.

The 31.6% increase in middle-income revenues in the second quarter of 2006 also contributed to the overall increase in total revenues and was driven, in part, by an enhanced product offering and improved mortgage products from commercial banks for this segment. Middle-income revenues as a percentage of total revenues represented 17.8% in the second quarter of 2006 compared to 23.9% in the same period of 2005, partially as a result of the considerable increase in affordable-entry level sales during the second quarter of 2006, after the Beta acquisition.

Gross profit for the quarter increased 84.0% to Ps.913 million from Ps.496 million in the same quarter of 2005. Homex generated a gross margin of 31.8% in the second quarter of 2006 compared to 30.5% in the same period of last year. The Company's improved gross margin for the quarter reflects, in part, the increased number of middle-income projects with higher average prices, as well as the cost synergies achieved following the successful integration of Beta into the Company's results.

Costs, as a percentage of revenues improved to 68.2% in the second quarter of 2006 from 69.5% in the same period of previous year, mainly due to an improved product offering in the middle-income segment, as well as economies of scale as the Company continued to realize synergies from the integration of Beta, particularly in the ongoing implementation of tighter controls on the procurement and use of materials. In absolute terms, costs increased 73.3% to Ps.1,955 million in the second quarter of 2006 from Ps.1,128 million in the same quarter of 2005, also as a result of the increase in home sales and the integration of Beta.

Selling and administrative expenses (SG&A) as a percentage of revenues remained stable at 9.9% in the second quarter of 2006 compared with the same period of 2005. In absolute terms, SG&A increased to Ps.283 million compared to Ps.161 million in the second quarter of 2005.

Operating income in the second quarter of 2006 increased 87.7% to Ps.629 million compared to Ps.335 million in the same period of 2005. Operating income as a percentage of revenues increased to 21.9% in the second quarter of 2006 from 20.6% in the same period of 2005 mainly reflecting a higher gross margin.

Other income in the second quarter 2006 was Ps.32 million compared to other income of Ps.17 million in the second quarter of 2005. Other income in the second quarter of 2006 mainly reflects income recorded on a percentage of completion basis, from infrastructure projects as well as income from construction materials sold to third parties during the period.

Net comprehensive financing cost increased to Ps.175 million in the second quarter of 2006 compared to Ps.29 million in the year ago period. As a percentage of revenues, net comprehensive financing cost was 6.1% in the second quarter of 2006 compared with 1.8% in the same quarter of 2005. The increase in net comprehensive financing cost was the result of the following:

a) Net interest expense increased to Ps.105 million in the quarter from Ps.45 million in the same quarter of 2005. The year over year increase in net interest expense was driven by an increase in the Company's debt levels, mainly reflecting borrowings under the credit facility in connection with the acquisition of Beta and the issuance of US$250 million unsecured senior notes, see "Liquidity." b) Monetary position in the second quarter of 2006 was Ps.18 million compared to Ps.13 million in the second quarter of 2005. c) Foreign exchange loss in the second quarter of 2006 was Ps.87 million compared to a foreign exchange gain of Ps.4 million in the second quarter of 2005, derived mainly from the net foreign currency denominated debt exposure and our hedge derivative which was impacted by the peso depreciation and the reference interest rate fluctuation.

These results reflect a net non-cash charge of Ps.87 million resulting mainly from the mark-to-market effect of the currency hedge incurred in connection with the Company's issuance of Dollar denominated senior notes in September of 2005.

Taxes: Income tax expense increased to Ps.152 million in the second quarter of 2006 from Ps.99 million reported in the same period of 2005. The effective tax rate for the second quarter of 2006 was 31.2%, which includes deferred income tax results.

Net income for the second quarter of 2006 reached Ps.336 million, representing a 47.9% increase over the Ps.227 million reported in the same period of 2005. Earnings per share for the second quarter were Ps.1.00, as compared to Ps.0.72 in the second quarter of 2005. This increase considers a reduced number of average shares outstanding in the second quarter of 2005 and the impact of increased net comprehensive financing cost resulting from the non-cash charge in connection with the Company's currency hedge.

Earnings per Share Change 1Q06 1Q05 1Q06/1Q05 Earnings per common share (pesos) 1.00 0.72 39.6 Earnings per ADR (US$) 0.53 0.38 39.6 Notes: - Pesos as of June 30, 2006 - US$ values estimated using an exchange rate Ps.11.3011 per US$ - Common share/ADR ratio: 6:1 - Weighted average number of shares for 2Q06: 335.9 million and for 2Q05: 314.1 million

EBITDA for the second quarter of 2006 rose to Ps.689 million, an increase of 88.4% from Ps.366 million recorded in the second quarter of 2005.

Land reserve: As of June 30, 2006, Homex's land reserve was 25.8 million square meters, a figure that includes both the titled land and land in process to be titled, and is equivalent to 145,578 homes, of which 115,793 are focused on the affordable entry-level and 29,785 in the middle-income segment. The Company utilized approximately Ps.419 million to buy additional land during the quarter with internally generated cash, financial debt and existing cash on-hand. Consistent with Homex's established land reserve policies, the Company continues to maintain sufficient land reserves for the construction of 2.5 years of annual sales. In addition, Homex maintained approximately 2.0 years of additional annual sales in optioned land.

Liquidity: As a result of changes made to the debt profile that were completed in 2005, the cornerstone of which was the issuance of the Company's Senior Unsecured Notes due in 2015, the Company will not face significant debt principal payments over the next three years, having substituted short-term, higher-cost debt with long-term debt at more attractive terms. Homex's average debt maturity was extended from 2.5 to 8 years. Homex leveraged its strong corporate governance, full SEC registration and NYSE listing to make the first-of-its-kind operation accessing the U.S. fixed income markets in the sector, with attractive terms and longer maturity than our Mexican competitors.

Homex had net debt of Ps.1,707 million as of June 30, 2006. Homex's debt to total capitalization ratio had improved to 0.27x while gross interest coverage was 6.6x. Homex funded its cash needs for the second quarter of 2006, including land acquisitions, debt service and working capital requirements through a combination of cash flow from operations, borrowings and existing cash on hand.

Highlights: - Net debt: Ps.1,707 million - Net debt to EBITDA ratio: 0.68x - Net debt to total capitalization ratio: 0.27x - Gross interest cover: 6.6x

Free cash flow for the first six months of 2006 was contributory in Ps.358.5 million, having an increase effect in the Company's cash and temporary investments of Ps.397.9 million, net of resources from external financing.

Reconciliation of net income (loss) to Free Cash Flow derived from our Mexican GAAP financial information (Thousands of constant pesos as of June 30, 2006) Accumulated as of June 2006 June 2005 Net income (loss) 568,510 399,112 Items that did not require resources (non-cash items) 264,176 181,057 Net resources used by operating activities (318,010) (1,325,330) Capital Expenditures (156,148) (11,678) Free Cash Flow 358,528 (756,838)

Accounts receivable: As a percentage of sales, Homex reported total receivables of 48.4% of pro forma revenues for the twelve months ended June 30, 2006, representing an improvement over the 62.5% reported in the second quarter of 2005, calculated for the twelve months ended June 30, 2005. Compared to the previous quarter, accounts receivables as a percentage of sales also improved from the 50.7% calculated for the twelve months ended March 31, 2006. Total accounts receivable as of June 30, 2006, was Ps.5,242 million, relatively stable when compared to Ps.5,219 million at the end of the previous quarter. Having finished the successful integration with Beta, Homex continues to show improved efficiencies in accounts receivable levels.

The period-end days in accounts receivable, calculated as of June 30, 2006, were 174 days, an improvement from the 183 days as of March 31, 2006. The year-over-year increase in the accounts receivable is primarily attributable to the integration of Beta and the higher number of middle-income homes sold during the period, which take longer to construct.

Working capital cycle: Homex reported a net working capital day cycle of 278 days, which includes inventory considering land turnover of 224 days plus 174 days of turnover receivables minus 120 turnover payables days (at cost), including payables from land acquisition. The Company believes it has one of the most favorable working capital cycles in the sector, indicating a high level of efficiency in the operations.

Business Highlights Homex Hosts World Bank President For Community Tour

On May 2, 2006, Homex hosted a visit by World Bank President Paul Wolfowitz to one of the Company's affordable entry-level developments in Monterrey, Mexico. Mr. Wolfowitz visited with Homex during his first official visit to Mexico since becoming President of the World Bank, as part of a review of Mexico's programs and efforts to reduce poverty by encouraging innovation and increasing competition. During the visit, the World Bank President recognized the Company for its efforts and social programs that have a positive impact on the quality of life for its clients and employees.

About Homex

Desarrolladora Homex, S.A.B. de C.V. is a leading, vertically-integrated home development company focused on affordable entry- level and middle-income housing in Mexico. It is one of the most geographically diverse home builders in the country. Homex has a leading position in the top four markets in Mexico and is the largest home builder in Mexico, based on the number of homes sold and net income.

For additional corporate information, please visit the Company's web site at: http://www.homex.com.mx/

Desarrolladora Homex, S.A.B. de C.V. quarterly reports and all other written materials may from time to time contain statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors can cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors include economic and political conditions and government policies in Mexico or elsewhere, including changes in housing and mortgage policies, inflation rates, exchange rates, regulatory developments, customer demand and competition. For those statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Discussion of factors that may affect future results is contained in our filings with the Securities and Exchange Commission.

Attached are the unaudited Consolidated Financial Information Data of Desarrolladora Homex, S.A.B. de C.V. for the three-month periods ended June 30, 2006 and 2005, and the Consolidated Balance Sheet of Desarrolladora Homex, S.A.B. de C.V. as of June 30, 2006 and 2005.

DESARROLLADORA HOMEX CONSOLIDATED BALANCE SHEET COMPARISON OF JUNE 30, 2006 WITH JUNE 30, 2005 (Figures in thousands of constant June 30, 2006 pesos) Change Jun-06 Jun-05 06 /05 ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,730,109 11.3% 419,181 5.3% 312.7% Accounts receivable, net 5,242,540 34.4% 4,001,317 50.5% 31.0% Inventories 5,910,016 38.7% 3,128,373 39.4% 88.9% Other current assets 279,822 1.8% 86,304 1.1% 224.2% Total current assets 13,162,487 86.3% 7,635,174 96.3% 72.4% 0.0% Property and equipment, net 584,825 3.8% 269,795 3.4% 116.8% Goodwill 642,212 4.2% - 0.0% - Other assets 867,579 5.7% 25,425 0.3% - TOTAL $15,257,104 100.0% $7,930,395 100.0% 92.4% LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Notes payable to financial institutions 78,092 0.5% 1,154,037 14.6% -93.2% Accounts payable 3,182,124 20.9% 1,288,756 16.3% 146.9% Advances from customers 302,116 2.0% 205,668 2.6% 46.9% Taxes payable 364,296 2.4% 54,857 0.7% 564.1% Total current liabilities 3,926,627 2,703,319 45.3% Long-term notes payable to financial institutions 3,359,246 22.0% 48,716 0.6% - DEFERRED INCOME TAXES 1,543,220 10.1% 838,504 10.6% 84.0% Total liabilities 8,829,093 57.9% 3,590,538 45.3% 145.9% STOCKHOLDERS' EQUITY Common stock 493,908 3.2% 226,603 2.9% 118.0% Additional paid-in capital 3,068,357 20.1% 2,325,963 29.3% 31.9% Retained earnings 2,662,802 17.5% 1,564,071 19.7% 70.2% Excess in restated stockholders' equity 315,965 2.1% 324,259 4.1% -2.6% Cumulative initial effect of deferred income taxes (147,634) -1.0% (147,634) -1.9% 0.0% Majority Stockholders' Equity 6,393,397 41.9% 4,293,261 54.1% 48.9% Minority interest 34,614 0.2% 46,595 0.6% -25.7% TOTAL STOCKHOLDERS' EQUITY 6,428,011 42.1% 4,339,856 54.7% 48.1% TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 15,257,104 100.0% 7,930,395 100.0% 92.4% DESARROLLADORA HOMEX CONSOLIDATED INCOME STATEMENT COMPARISON OF SECOND QUARTER 2006 WITH SECOND QUARTER 2005 (Figures in thousands of constant June 30, 2006 pesos) Change 2Q06 2Q05 2006/2005 REVENUES Affordable-entry level revenue $2,292,912 80.0% 1,147,140 70.6% 99.9% Middle income housing revenue 510,250 17.8% 387,723 23.9% 31.6% Other revenues 63,915 2.2% 89,311 5.5% -28.4% TOTAL REVENUES 2,867,076 100.0% 1,624,174 100.0% 76.5% COSTS 1,954,507 68.2% 1,128,116 69.5% 73.3% GROSS PROFIT 912,569 31.8% 496,058 30.5% 84.0% SELLING AND ADMINISTRATIVE 283,343 9.9% 160,769 9.9% 76.2% EXPENSES OPERATING INCOME 629,226 21.9% 335,289 20.6% 87.7% OTHER INCOME 32,169 1.1% 16,874 1.0% 90.6% NET COMPREHENSIVE FINANCING COST Interest expense and commissions 134,519 4.7% 57,397 3.5% 134.4% Interest income (29,269) (12,045) -0.7% 143.0% Foreign exchange (gain) loss 87,188 3.0% (3,564) -0.2% - Monetary position loss (17,626) -0.6% (12,646) -0.8% 39.4% 174,811 6.1% 29,141 1.8% 499.9% INCOME BEFORE INCOME TAX AND EMPLOYEE STATUTORY PROFIT 486,585 17.0% 323,022 19.9% 50.6% SHARING EXPENSE INCOME TAX EXPENSE 151,574 5.3% 98,622 6.1% 53.7% NET INCOME 335,011 11.7% 224,401 13.8% 49.3% MAJORITY INTEREST 335,546 226,801 47.9% MINORITY INTEREST (536) 0.0% (2,400) 0.0% -77.7% NET INCOME 335,546 11.7% 226,801 14.0% 47.9% Earnings per share 1.00 0.72 EBITDA 689,098 24.0% 365,808 22.5% 88.4% DESARROLLADORA HOMEX CONSOLIDATED INCOME STATEMENT COMPARISON OF SIX MONTHS 2006 WITH SIX MONTHS 2005 (Figures in thousands of constant June 30, 2006 pesos) Change 2006 YTD 2005 YTD 2006/2005 REVENUES Affordable-entry level revenue $4,135,712 80.3% 2,139,677 72.4% 93.3% Middle income housing revenue $ 920,684 17.9 712,066 24.1% 29.3% Other revenues $ 95,725 1.9% 105,420 3.6% -9.2% TOTAL REVENUES 5,152,121 100.0% 2,957,163 100.0% 74.2% COSTS 3,526,618 68.4% 2,037,625 68.9% 73.1% GROSS PROFIT 1,625,503 31.6% 919,537 31.1% 76.8% SELLING AND ADMINISTRATIVE EXPENSES 488,997 9.5% 283,060 9.6% 72.8% OPERATING INCOME 1,136,506 22.1% 636,477 21.5% 78.6% OTHER INCOME 38,109 0.7% 17,164 0.6% 122.0% NET COMPREHENSIVE FINANCING COST Interest expense and commissions 252,066 4.9% 98,873 3.3% 154.9% Interest income (47,318) -0.9% (23,569) -0.8% 100.8% Foreign exchange (gain) loss 138,715 2.7% (6,056) -0.2% - Monetary position loss 6,592 0.1% 3,442 0.1% 91.5% 350,056 6.8% 72,691 2.5% 381.6% INCOME BEFORE INCOME TAX AND EMPLOYEE STATUTORY PROFIT 824,560 16.0% 580,950 19.6% 41.9% SHARING EXPENSE INCOME TAX EXPENSE 259,278 5.0% 181,838 6.1% 42.6% NET INCOME 565,282 11.0% 399,113 13.5% 41.6% MAJORITY INTEREST 568,509 11.0% 403,689 13.7% MINORITY INTEREST (3,228) -0.1% (4,576) -0.2% - NET INCOME 568,509 11.0% 403,689 13.7% 40.8% Earnings per share 1.68 1.27 - 32.4% EBITDA 1,211,338 23.5% 680,593 23.0% 78.0% DESARROLLADORA HOMEX CONSOLIDATED STATEMENT OF CHANGES IN FINANCIAL POSITION Comparison of six-months ended June 30, 2006 and 2005 (Figures in thousands of constant June 30, 2006 pesos) 2006 YTD 2005 YTD Net Income 568,510 399,112 Items that did not require resources: 264,176 181,057 Cash flow from net income 832,686 580,169 Net resources used in operating activities (318,010) (1,325,330) Net resources generated by operating activities 514,676 (745,161) Net resources generated by external financing 39,417 621,188 Net resources used in investing activities (156,148) (11,678) Net increase (decrease) in cash and temporary investments 397,945 (135,650) Cash and temporary investments at the beginning of the period 1,332,164 554,832 Cash and temporary investments at period end 1,730,109 419,181 Free Cash Flow (1) 358,528 (756,838) (1) Free Cash Flow is defined by Net resources generated by operating activities plus/minus net resources used in investing activities.