Half-Year Report 2020

HALF-YEAR REPORT 2020

O2 Czech Republic a.s. Note:

O2 Czech Republic a.s. hereinafter “O2 CZ” or the “Company”. O2 Slovakia, s.r.o. hereinafter “O2 Slovakia”.

O2 Czech Republic Group (the “Group”) consists of O2 Czech Republic a.s. (the “Company”) and its subsidiaries.

Financial data and information listed in this Half-year Report has not been audited.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

2 Table of Contents

Financial and operating highlights – 4 –

Board of Directors' report on the results of the Group in the first half of 2020 – 9 –

Interim condensed unaudited consolidated financial statements for the six months ended 30 June 2020 – 18 –

Declaration of persons responsible for the Half-Year Report – 42 –

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

3 Financial and operating

highlights

O2 Czech Republic a.s. | 2020 Half-Year Report Financial and operating highlights

Financial data is based on the Interim Consolidated Financial Statements for the six months ended 30 June 2020 prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting as adopted by the European Union.

1H 20201 1H 20192

Financials (in CZK million)

Revenues 19,326 18,989

EBITDA – Earnings before depreciation and amortization 6,325 6,055

Operating profit 3,671 3,479

Profit before taxes 3,389 3,312

Profit for the period 2,675 2,604

Total assets 38,432 42,680

Property, plant and equipment 6,262 6,171

Intangible assets 14,573 15,457

Total equity 10,598 14,177

Financial debts (long-term and short-term) 14,885 14,596

Capital expenditure (additions to fixed assets) 958 1,055

1 Financial indicators extracted from the Balance Sheet as of 30 June 2020 and from the Statement of Total Comprehensive Income for the six months ended 30 June 2020, operating indicators as of 30 June 2020. 2 Financial indicators extracted from the Balance Sheet as of 31 December 2019 and from the Statement of Total Comprehensive In- come for the six months ended 30 June 2019, operating indicators as of 30 June 2019.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

5 1H 2020 1H 2019

Operating indicators (at end of period)

Fixed voice accesses (in thousand) 434 490

Fixed broadband internet (in thousand)3 845 822

Pay TV – O2 TV (IPTV and OTT, in thousand) 476 383

Registered mobile customers in the Czech Republic (in thousand)4 5,910 5,597

Active customers in Slovakia (in thousand) 2,157 2,081

Number of employees in Group 5,024 5,230

Ratios (at end of period)

EBITDA margin (EBITDA/revenues, in%) 32.7 31.9

Profit after taxes / Revenues (in%) 13.8 13.7

Capital expenditure / Revenues (in%) 5.0 5.6

ROA (Profit after taxes / Total assets, in%, annualised) 13.9 11.3

ROE (Profit after taxes / Equity, in%, annualised) 50.5 45.5

Gross gearing (Financial debts / Total equity, in%) 140.5 127.2

Net debt / EBITDA (annualised)6 0.91 0.48

Earnings7 per share – consolidated (CZK) 8.9 8.6

– unconsolidated (CZK) 11.8 11.0

Macroeconomic indicators8

CZK/EUR exchange rate – average 26.33 25.68

CZK/EUR exchange rate – at end of period 26.74 25.45

3 Fixed access (ADSL, VDSL, optical fibre) and wireless access (4G LTE, WTTx). 4 Customers who generated revenues in the past 13 months. 5 Customers who generated revenues in the past 3 months. 6 Net debt = financial obligations minus cash and cash equivalents; 1H 2019: financial obligations minus lease obligations, EBITDA including the effect of IFRS 16 application (0.51 excluding the effect of IFRS 16 application). 7 Earnings attributable to shareholders/weighted number of ordinary shares outstanding. 8 Source: Czech National Bank web page (FX rates of other currencies).

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

6 Alternative performance pean Union are presented. The Company reports on alternative performance indica- measures tors, which are additional information to the financial statements and assist in the In this Half-Year Report, some alternative overall assessment of the economic situa- performance measures which are not re- tion and performance of the Group, in ac- ported as standard in the Consolidated cordance with Guidelines for Alternative Financial Statements prepared in accord- Performance Measures published by ESMA. ance with International Financial Reporting Standards (IFRS) as adopted by the Euro-

Reconciliation to financial Metric Definition Purpose statements (in CZK million) Earnings see Interim Consolidated before tax, Shows operating Statement of Comprehensive EBITDA depreciation performance Income (EBITDA): and of the Company 1H 2019: CZK 6,055m amortization 1H 2020: CZK 6,325m see Interim Consolidated Measures Statement of Comprehensive EBITDA EBITDA / operating Income (Revenues and EBITDA): margin Revenues profitability of 1H 2019: 6,055/18,989 = 31.9% the Company 1H 2020: 6,325/19,326 = 32.7% see Interim Consolidated Statement of Comprehensive Shows how Profit for the Income (Profit after tax) and effectively assets ROA period / Total Consolidated Balance Sheet (Total are used for assets assets): profit generation 1H 2019: 2,604*2/45,983 = 11.3% 1H 2020: 2,675*2/38,432 = 13.9% see Interim Consolidated A ratio of the Statement of Comprehensive reported profit Profit for the Income (Profit after tax) and to the capital ROE period / Total Interim Consolidated Balance invested by the equity Sheet (Total equity): shareholders in 1H 2019: 2,604*2/11,457 = 45.5% the Company 1H 2020: 2,675*2/10,598 = 50.5% see Interim Consolidated Balance Shows the share Sheet (Total equity. Long- and of borrowings short-term financial obligations): Borrowings / the Company Gross gearing 1H 2019: (14,539+39)/11,457 = Total equity uses for its 127.2% operation to 1H 2020: (14,834+51)/10,598 = total equity 140.5%

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

7 Reconciliation to financial Metric Definition Purpose statements (in CZK million) Measures the see Interim Consolidated Financial Company’s ability Statement of Comprehensive liabilities less to pay its debts; Income (EBITDA) and Interim cash and cash roughly reflects Consolidated Balance Sheet (Cash equivalents / the time the Net debt / and cash equivalents. Long- and Profit before Company needs EBITDA short-term financial obligations): interest, to repay all 1H 2019: (14,539+39-8,813)/ taxes and its debts from (6,055*2),= 0.48 depreciation its standard 1H 2020: (14,834+51-3,322)/ (EBITDA) operating cash (6,325*2),= 0.91 flow Additions to fixed assets are Capital Expresses the presented in Note 8 and 9 to the Capital expenditure amount the Interim Consolidated Financial expenditure / (additions to Company invests Statements: Revenues fixed assets)/ in its future 1H 2019: (652+403)/18,989 = 5.6% Revenues development 1H 2020: (498+460)/19,326 = 5.0% Net cash flows from operating activities minus net Measures the cash flows volume of see Interim Consolidated Cash from investing cash and cash Flow Statement (Net cash flows activities (since equivalents which from operating activities. Net cash Free cash 2019, interest the Company flows from investing activities): flows paid, including generates after 1H 2019: 4,483 – 1,712 = CZK interest it has paid for all 2,771m expense items necessary 1H 2020: 5,367 – 1,404 = CZK on lease to continue its 3,963m obligations, operations is included in cash flows from financing activities)

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

8 Board of Directors' report on the results of the Group

in the first half of 2020

O2 Czech Republic a.s. | 2020 Half-Year Report Board of Directors' report on the results of the Group in the first half of 2020

In this section, the Board of Directors pres- During the state of emergency, the Compa- ents information on the Group's business ny recorded a significant increase in voice and financial results for the first half of and data traffic in the mobile and fixed 2020, including important factors affecting networks. This increase was largely due to its business and results for the period, and the Company's decision to assist customers a comparison with the corresponding peri- through its services and products during od of the previous year. this difficult period. From 13 March until the end of April 2020, O2 CZ offered an Impact of the COVID-19 pan- unlimited data allowance free of charge, both for new and existing mobile contract demic on the Group's operating, customers. The network and the technolo- business and financial results gy handled the higher volume of voice and data traffic without major problems. On 12 March 2020, the government of the Czech Republic declared a state of emer- While stores in the Czech Republic remained gency for the entire territory of the Czech open, the Company recorded lower custom- Republic due to a health threat in connec- er traffic in its retail network, which led to tion with the occurrence of coronavirus. The a slowdown in sales of mobile phones and government and other public administra- accessories. The lower number of customer tion bodies subsequently ordered various interactions also led to a slowdown in sales measures that affected the business envi- of new services and thus to a lower growth ronment and O2 CZ. The state of emergency in the number of new customers. However, was extended several times and lasted until the average churn rate remained low. 17 May 2020. While in the first two months the financial O2 CZ, as a telecommunications provider, performance was positive, largely fuelled falls within the scope of the Electronic Com- by higher investments in growth areas in munications Act and as such is an operator the previous two years, the negative impact of critical infrastructure. Following from of the COVID-19 pandemic began to show this, it was obliged to continue its business in the Group's financial results from the and ensure the availability of its services to second half of March onwards. The intro- customers. As a result, its business was not duction of travel restrictions has negatively interrupted; the Company continued to affected roaming revenue, both incoming provide a large part of its basic services and and abroad. In line with the methodology remained relatively immune to the impact for calculating provisions under IFRS 9, pes- of the pandemic compared to businesses in simistic macroeconomic forecasts already other sectors. The direct impact of general reflected in higher costs associated with the restrictions on movement or business was impairment of financial assets in the first therefore relatively small compared to oth- half of the year. er sectors.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

10 Despite the difficult market situation caused O2 CZ offered customers from the ranks of by the COVID-19 pandemic, the Company entrepreneurs and small trades an advan- successfully refinanced a bank loan. The man- tageous package of O2 RE: START services, agement considers the Company's current which is intended to help them digitize financial situation to be sufficient to ensure their business, address new customers and unrestricted continuation of the operation. restart their operation. O2 RE: START included the use of the Market Locator and Overview of commercial and O2 Benefits marketing tools, a mobile tariff and high-speed internet bundle for busi- financial results, outlook for ness, a discount on a new phone or laptop, the second half of the year or an Office 365 license including MS Teams or 1 TB of cloud storage for 6 months free In the first half of the year, the offer of new of charge. services and products by the Group companies in the Czech Republic and Slovakia fo- Propelled by continued expansion of the cused mainly on helping the state, custom- availability of O2 Internet HD in the Czech ers and the whole economy cope with the Republic, the number of its users increased difficult situation in connection with the by 23 thousand year on year. At the end COVID-19 pandemic and massive shift of ac- of June, a total of 845 thousand customers tivities into the digital space. used broadband from O2 CZ. O2 TV digital television remained the fastest growing The stability and quality of the networks in service. The number of customers of one of which it invests intensively every year has the tariffs of this service (IPTV and OTT ver- made it possible for the Company to offer, sion), which operates on a fixed line from as the first among mobile operators, unlim- O2 CZ and on an internet connection from ited data for all those who needed to be in any provider, increased by 93 thousand year contact with their loved ones or work re- on year and reached 476 thousand as at motely during difficult times. This offer was 30 June 2020. This number also includes cus- available to all new and existing customers tomers using the monthly O2 TV Sport Pack of voice tariffs with data as part of the NEO online and O2 TV HBO and Sport Pack plans. bundle, which could be activated in the The number of customers who enjoy watch-

Moje O2 online self-service or in store. ing O2 TV on multiple devices or on online via a web interface continued to grow. At We wanted to help people relax with quali- the end of June, the Company registered al- ty film and TV content, so the Company has most one and a half million active accesses. made premium film, children's, sports and documentary channels, such as HBO, Na- At the end of June 2020, the customer base tional Geographic and many others, avail- of mobile contract services in the Czech able to all who wanted them for a symbolic Republic was 3,262 thousand; the number one crown. Customers could watch all pro- of customers of prepaid mobile services grams on any device, i.e. not only on TV, but reached a total of 1,927 thousand, while also on a PC or in the O2TV application on the number of customers of M2M services a mobile phone and tablet. was 721 thousand.

For customers who needed to work or learn O2 Slovakia also decided to help during from home, the Company also offered a dis- the emergency situation related to the count on Lenovo IdeaPad S130 14 "note- COVID-19 pandemic. When the schools book, including a modem, to go with Zlatá were closed, O2 Slovakia's corporate foun- O2 Data 10 GB tariff. dation (Férová nadace) announced a grant

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

11 of EUR 60,000 named O2 Digital School. It Consolidated financial results was intended for projects, online platforms and initiatives that address the issue of digi- This section presents and comments on tal distance learning in a conceptual and sys- the Group's consolidated financial results, temic way. Another grant was an employ- which were taken from the Interim Con- ee grant called sKORO NA všechno. It was solidated Financial Statements for the six aimed at supporting projects that helped in months ended 30 June 2020, prepared in the field of education of minority groups, accordance with International Accounting 3D printing of protective shields, support Standard IAS 34 Interim Financial Reporting or assistance to the elderly and online ac- as adopted by the European Union. tivities for the broadest groups of people. Forty-one projects applied for this grant, of Consolidated statement of comprehensive which the foundation selected 16 to which income it distributed EUR 36,000. The Group's consolidated revenue reached In March, while Slovakia was in a state of CZK 19.3 billion in the first half of the year, emergency in connection with the corona- up 1.8% year on year. Revenue from mo- virus pandemic, O2 Slovakia extended ben- bile data services and digital television con- efits for customers aimed at improving continued to grow. On the other hand, the ditions for working from home or enjoying COVID-19 pandemic negatively affected their free time. These included temporary mobile revenue, especially in the area of free access to the HBO GO service, speed- roaming and equipment sales. ing up data transmission after the customer's data allowance has been used up in the Operating revenue in the Czech Republic Internet na doma tariff, or adding chan- reached a total of CZK 15.9 billion, which nels to the Modrá O2 TV and O2 TV v mobile represents a year-on-year increase of 2.7%. plans. Operating revenue of the mobile segment decreased by 0.6% year on year to CZK In mid-April 2020, when the demand for 9.9 billion, while the 15.4% increase in rev- large volumes of data was higher than ever enue from data services did not fully com- before, O2 Slovakia came up with another pensate for the decline in other revenue. revolutionary market proposition and intro- Revenue from voice services, SMS and MMS duced three data-unlimited tariffs Titanový, were 8.6% lower; revenue from the sale of Platinový a Diamantový O2 SMART Paušál. equipment declined 8.7% and other mobile revenue were down 17.2%, mainly due to The number of O2 Slovakia customers in- lower revenue from incoming roaming. Op- creased to 2,157,000 by the end of June erating revenue in the fixed line segment in- 2020. The number of customers of mo- creased by 8.7% year on year to CZK 5.6 bil- bile contract services was 1,048 thousand; lion in the first half of the year. Traditionally,

718 thousand customers used prepaid ser- higher revenue from O2 TV were the main vices and 391 thousand used M2M services. contributor to this growth. Revenue from At the end of June, 4G LTE network service ICT services were 16.9% higher as a result was available to 97.4% of the population of of several projects, while revenue from the Slovakia. In addition to the WTTx wireless sale of equipment increased by 103% year network using LTE TDD technology in the on year due to a higher demand for the

3.5 / 3.7 GHz spectrum, customers of Internet O2 Smart Box, which improves home inter- na doma home internet service could also net connection and Wi-Fi reach. The suc- use this network. cess of Samsung's 4K smart TVs also played a role the increase and helped customers

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

12 with the seamless transition to DVB-T2. Consolidated balance sheet Revenue in Slovakia decreased 3.7% year on year to CZK 3.6 billion, while, as in the The net book value of property, plant and Czech Republic, the coronavirus pandemic equipment amounted to CZK 6.3 billion as at had a negative impact on equipment sales 30 June 2020, almost the same as at 31 De- and roaming revenue. cember 2019. The most significant part of the net book value of property, plant and Total consolidated costs decreased by 0.2% equipment was telecommunications tech- year on year to CZK 13 billion in the first half nology and equipment, including exchang- of the year. Direct costs of sales increased es and transmission telecommunication net- slightly by 0.3% year on year while person- work technology. As at 30 June 2020, the nel costs were up 1%. Third party costs de- net book value of intangible assets fell by creased by 7.2%, mainly due to lower rental 5.7% to CZK 14.6 billion. costs. Impairment losses on financial assets totalled CZK 246 million in the first half of Total amount of consolidated financial lia- 2020, up almost 100% year on year. In ac- bilities (short-term and long-term)2 reached cordance with the requirements of IFRS 9, CZK 14.9 billion as at June 30, 2020, com- the creation of provisions for receivables as pared to CZK 14.6 billion as at 31 December at 30 June 2020 reflected expectations of 2019. O2 CZ successfully refinanced a bank worsened macroeconomic indicators and loan when, on 20 May 2020, it entered into forecasts of future developments as a result a loan agreement of up to CZK 9.24 billion of restrictive measures related to the out- with a maturity of 5 years. More information break of the COVID-19 pandemic. on financial liabilities is provided in Note 12 to the condensed Interim Consolidated Fi- Earnings before interest, taxes, deprecia- nancial Statements for the six months end- tion and amortization (EBITDA) amounted ed 30 June 2020. Cash and cash equivalents to CZK 6.3 billion in the first half of the year, amounted to CZK 3.3 billion at the end of 4.5% more than in the same period in 2019. June 2020, compared to CZK 6 billion at In the Czech Republic, EBITDA increased by 31 December 2020. The decrease is attribut- 4.7% to CZK 4.8 billion, while in Slovakia ed mainly to the payment of an advance on it was up 4.1% to CZK 1.5 billion. Consoli- the dividend for 2019 and part of the share dated EBITDA margin thus reached 32.7% premium; the payment was made in the in the first half of the year (30.3%1 in the first half of 2020. The net debt to EBITDA Czech Republic, 42.3% in Slovakia). ratio3 was 0.9 as at the end of June.

In the first half of the year, the consolidat- Consolidated capital expenditure ed operating profit and consolidated profit before tax increased by 5.5% and by 2.3% In the first half of 2020, total consolidated year on year to CZK 3.7 billion and CZK capital expenditures (additions to assets) 3.4 billion, respectively. Net financial ex- reached CZK 958 million, down 9.1% year penses were up 70% due to slightly high- on year; the share of consolidated capital er interest expenses and unrealized foreign expenditure to consolidated revenue was exchange losses. Consolidated net profit 5%. All investments in the first half of the reached a total of CZK 2.7 billion in the first year were made in the Czech Republic and half of the year, which represents a year-on- Slovakia and were financed from own re- year increase of 2.8%. sources and loans.

1 Operating profitability in the Czech Republic is lower compared to Slovakia due to the inclusion of the cost of access to CETIN fixed and mobile telecommunications networks in the costs of sales of services. 2 Excluding lease liabilities 3 Financial debt (excluding lease liabilities) minus cash / EBITDA for the first half 2020 multiplied by two.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

13 Investments in Slovakia decreased by 13.3% egy and activities of the previous year and year on year to CZK 415 million and their the first half of 2020. Accordingly, in the share to revenue decreased by 1.3 percent- second half of 2020, the Group companies age points to 11.5%. Investments continued will continue to offer and promote their ex- to focus mainly on increasing the coverage, isting and develop new, innovative and in capacity and quality of networks, which ac- many ways unique services and products. counted for two thirds of all investments in Slovakia in the first half of 2020. The Company's management remains cau- tious regarding the further development of In the Czech Republic, investments in the the COVID-19 pandemic and regularly mon- first half of the year reached a total of itors the situation. However, it is not able to CZK 543 million, which represents a year- predict the duration of the pandemic and all on-year drop of 5.6%, and their share to its possible consequences for the Group's fi- revenue was only 3.4%. The main areas of nancial performance. Furthermore, it is not investment were information system up- able to predict the consequences of all cur- grades and investments related to the de- rent or future actions and measures taken velopment and marketing of new services. by the Czech and Slovak governments or at the level of the European Union, which will Consolidated cash flow statement have an impact on macroeconomic developments in both countries. Consolidated free cash flows4 reached a total of CZK 4 billion in the first half of 2020, Developments in the market compared to CZK 2.8 billion in the first half of 2019. This increase is due, among other and in the area of regulation things, to the positive change in working capital in connection with the securitization There were no significant changes or launch- of O2 Slovakia's receivables. More informa- es of new services on the Czech or Slovak tion is provided in Note 15 to the condensed telecommunications market in the first half Interim Consolidated Financial Statements of the year. for the six months ended 30 June 2020. An- other positive effect of the year-on-year in- On 1 April 2020, an amendment to the crease in free cash flows was 19.1% lower Electronic Communications Act entered cash flows for the acquisition of fixed assets. into force, which shortened the maximum time allowed to port a number, adjusted Since 2019, the Group has reported interest the amount and eligibility to payment of paid (including interest on a lease liability) a contractual penalty in the event of early in net cash flows from financing activities. termination of the contract, and introduced Paid lease liabilities are also reported in net other partial changes. cash flows from financing activities in accordance with IFRS 16. Without the impact of The Czech Telecommunication Office (CTO) IFRS 16, free cash flows would have reached continued to review analysis for relevant CZK 3.6 billion in the first half of 2020. markets 1 and 2 (call termination in fixed and mobile networks) and proposed to the Outlook for the second half of 2020 existing termination rates until uniform termination rates are set throughout the Eu- The aim of the Board of Directors of the ropean Union, which are expected to take Company is to build on the business strat- effect from 1 January 2021.

4 Free cash flows = net cash flows from operating activities plus net cash flows from investing activities; from 2019, interest paid (including interest expense on lease liabilities) is included in cash flows from financing activities.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

14 In the first half of 2020, the CTO launched for a period of 30 days with the possibility of two public consultations on the draft terms extension with the consent of the Chamber of a for radio spectrum in the 700 MHz and of Deputies of the Parliament of the Czech 3500 MHz frequencies. On 7 August 2020, Republic (PSP CR). In view of the sudden and the CTO announced the tender. Registra- unpredictable development of the epidem- tion is open until 30 September 2020. ic and the effects of government measures, the Board of Directors decided on 30 March On 31 March 2020, the Office for Regula- 2020, in the event that the General Meet- tion of Electronic Communications and Post- ing cannot be physically held as planned on al Services of the Slovak Republic (market 16 April 2020, to pay an advance on the 2019 regulator) published a call for tenders for dividend. The conditions for the payment of individual permits for the use of 700 MHz, the advance were the same as in the origi- 900 MHz and 1,800 MHz frequencies. The nal proposal submitted for approval to the competition took the form of an electronic General Meeting. On 9 April 2020, based on auction. The publication of the call marked a resolution of the Chamber of Deputies of the commencement of the tender proce- the Parliament of the Czech Republic, the dure. The bidding will take place in the Government of the Czech Republic extend- form of an electronic auction in the SMRA ed the state of emergency until 30 April format (simultaneous multi-round auction). 2020. Measures of public authorities against On 18 June 2020, the market regulator an- the spread of the disease therefore finally nounced it receive information which could prevented the General Meeting convened potentially jeopardize the tender and de- for 16 April 2020 from taking place. cided to change the date of the tender. No relevant information on the progress of the Payment of dividend advances procedure was available as at the date of this Half-Year Report. On 9 April 2020, the Board of Directors of the Company concluded that objective rea- Impacts of the COVID-19 sons prevented the General Meeting con- pandemic on the decisions vened for 16 April 2020 from taking place. The Board of Directors informed the share- of the Company's supreme holders on its website on the same day. This governing body fulfilled the conditions for the application of the decision of the Board of Directors of General Meeting called for 16 April 30 April 2020 on the payment of dividend 2020 advance. From 6 May 2020, the Compa- ny started paying an advance payment of CZK 17 before tax on shares with a nominal The Company's Board of Directors originally value of CZK 10 and an advance of CZK 170 convened the General Meeting for 16 April per share with a nominal value of CZK 100. 2020. With regard to the necessary techni- Those persons who were listed as share- cal and organizational deadlines, the doc- holders on 6 April 2020 were entitled to uments and the invitation to the General payment. Meeting had to be approved and submitted for distribution to shareholders by 6 March 2020, so that the publishing deadline of General Meeting procedure per rollam 30 days before the General Meeting is met. However, during printing and distribution, On 28 April 2020, following another reso- the Government of the Czech Republic de- lution of the Chamber of Deputies of the clared a state of emergency for the entire Parliament of the Czech Republic, the gov- territory of the Czech Republic, originally ernment extended the state of emergency

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

15 until 17 May 2020. As the Board of Direc- publika Audit, s.r.o. gave an unqualified tors was once forced to announced that opinion on both sets of financial state- the General Meeting could not be held for ments. objective reasons and after careful consid- eration of all the circumstances, that it will • Approved the distribution of the Compa- use the statutory procedure to mitigate the ny's unconsolidated profit for 2019 as fol- effects of the coronavirus epidemic.5 This lows: CZK 5,274 million is payable in div- law, which entered into force on 24 April idends (CZK 17 before tax per share with 2020, allowed, among other things, the a nominal value of CZK 10, or CZK 170 be- bodies of legal entities to make decisions fore tax per share with a nominal value per rollam. The Board of Directors therefore of CZK 100) and the amount CZK 69 mil- resolved that the decisions of the General lion will be transferred to the account Meeting would be made per rollam, and of retained earnings of previous years. on 29 April 2020 published an announce- At the same time, the General Meeting ment to this effect on the Company's web- stated that the amount of dividends per site. Subsequently, on 11 May 2020, it pub- share fully corresponded to the amount lished and distributed to shareholders draft of advances, the payment of which was resolutions of the General Meeting, which decided by the Company's Board of Direc- were the same as for the General Meeting tors on 30 March 2020 (see above section convened for 16 April 2020. The proposals Payment of Dividend Advances), and that were divided into two areas; voting ended based on the resolution of the General on 17 June and 2 July 2020, respectively. Meeting, on 19 June 2020 the advance on Persons who were listed in the register of dividends will be settled by deducting the shareholders as of 5 May 2020 were eligible advance per share (CZK 17 and CZK 170, to vote. respectively) from the dividend on the same share (CZK 17 and CZK 170, respec- Per rollam decisions of the General tively), which means the settlement will Meeting result in a zero balance, and there will be no outstanding balance to pay above the The Board of Directors of the Company an- scope of advances already paid. nounced on 18 June 2020 that the General Meeting would pass decisions outside the • Approved the distribution of part of the meeting (per rollam) on the proposals of the share premium up to CZK 1,241 million, first round of voting and adopted all pro- which will be paid to shareholders (CZK 4 posed resolutions in the first round by the before tax for each share with a nominal required majority of votes. The same Board value of CZK 10 and CZK 40 before tax per of Directors announced on 3 July 2020 the share with a nominal value of CZK 100). results of the second round of voting. • In connection with measures related to Acting in writing outside the meeting, the the optimization of the capital structure, General Meeting: the General Meeting decided to acquire own shares. The Company can thus ac- • Approved the Company's unconsolidated quire shares to the limit of 30,088,214 and consolidated financial statements for shares for a period of five years from 9 De- 2019 prepared in accordance with Inter- cember 2020 for the highest total price national Financial Reporting Standards. of CZK 5.5 billion. At the same time, the The statutory auditor of KPMG Česká re- General Meeting decided to reduce the

5 Act No. 191/2020 Coll., On certain measures to mitigate the effects of the SARS CoV-2 coronavirus epidemic on persons participating in court proceedings, victims, victims of crime and legal persons, and on amendments to the Insolvency Act and the Enforcement Code.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

16 share capital by cancelling own shares, Other information which were acquired between 2015 and 2020. The share capital will be reduced by On 5 August 2020, after the bankruptcy and CZK 93,379,100 by cancelling own shares settlement had been concluded, the sub- to CZK 3,008,821,570. The reduction will sidiary AUGUSTUS, spol. s r.o., in which the be effected only in the Company's ac- Company held a 39.76% non-controlling count and will not affect the Company's share in the registered capital, was deleted liabilities. from the Commercial Register.

• Approved the remuneration policy for A list of significant related party trans- members of the Board of Directors and the actions that occurred in the six months Supervisory Board of the Company, thus ended 30 June 2020, as well as changes fulfilling the obligation newly imposed in transactions, which were disclosed in on issuers of securities by an amendment the Group's last Annual Report, is set out to the Capital Market Undertakings Act. in Note 15 to the condensed interim con- It also approved a new version of the Ar- solidated financial statements for the six ticles of Association effective from 1 Jan- months ended 30 June 2020. uary 2021. The changes to the Articles of Association followed from legislative changes, in particular on the scope of powers of the General Meeting and the Supervisory Board in relation to remuneration policy and significant agreements with related parties, invitation to Gener- al Meetings, (counter)proposals of shareholders and matters related to employee representatives in the Supervisory Board.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

17 Interim condensed unaudited consolidated

financial statements

for the six months

ended 30 June 2020

O2 Czech Republic a.s. | 2020 Half-Year Report O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020

O2 O2 CCzechzech R eRepublicpublic a.s. a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

O2 Czech Republic a.s.

OIN2T ECRzIeMc hC ROeNpDuEbNlicS EaD.s .C ONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2020 I NTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2020 PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARD IAS 34 INTERIM FINANCIAL REPORTING AS ADOPTED BY THE PERUERPOAPREEADN I NU NAICOCNO RDANCE WITH INTERNATIONAL ACCOUNTING S TANDARD IAS 34 INTERIM FINANCIAL REPORTING AS ADOPTED BY THE E UROPEAN UNION

Translation note This version of the interim consolidated financial statements is a translation from the original, which was prepared in the Czech language. All possible care has been taken to ensure that the translation is an Translation note accurate representation of the original. However, in all matters of interpretation of information, views or This version of the interim consolidated financial statements is a translation from the original, which was opinions, the Czech version of the interim consolidated financial statements takes precedence over this prepared in the Czech language. All possible care has been taken to ensure that the translation is an translation. accurate representation of the original. However, in all matters of interpretation of information, views or opinions, the Czech version of the interim consolidated financial statements takes precedence over this translation. O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

19 O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020

O2 O2 CCzechzech R eRepublicpublic a.s. a.s. O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

INDEX PAGE

GENERAL INFORMATION 21 INTERIM CONSOLIDATED STATEMENT OF TOTAL COMPREHENSIVE INCOME 22 INTERIM CONSOLIDATED BALANCE SHEET 23 INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 24 INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS 25 O2 Czech Republic a.s. CONDENSED NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS 26

1 ACCOUNTING POLICIES 26 OIN2T ECRzIeMc hC ROeNpDuEbNlicS EaD.s .C ONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2020 2 COVID-19 PANDEMIC 26 I NTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 3 SEGMENT INFORMATION 27

FOR THE SIX MONTHS ENDED 30 JUNE 2020 4 REVENUES 30 PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING 5 INCOME TAX 31 STANDARD IAS 34 INTERIM FINANCIAL REPORTING AS ADOPTED BY THE PEURERPOAPREEADN I NU NAICOCNO RDANCE WITH INTERNATIONAL ACCOUNTING 6 NET IMPAIRMENT LOSSES ON FINANCIAL ASSETS 31 S TANDARD IAS 34 INTERIM FINANCIAL REPORTING AS ADOPTED BY THE 7 DIVIDENDS, OTHER DISTRIBUTION AND EARNINGS PER SHARE 32 E UROPEAN UNION 8 PROPERTY, PLANT AND EQUIPMENT 33

9 INTANGIBLE ASSETS 33

10 CASH AND CASH EQUIVALENTS 33

11 INVENTORIES 33 12 FINANCIAL LIABILITIES 33

13 CONTINGENCIES AND LITIGATIONS 35

14 COMMITMENTS 35

15 RELATED PARTY TRANSACTIONS 35

16 SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES 37 17 FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE 39 18 POST BALANCE SHEET EVENTS 40

20 O2 Czech Republic a.s. O2O2 CCzechzech R eRepublicpublic a.s. a.s. 3 Interim condensed consolidated financial statements for the six months ended 30 June 2020 InterimInterim co condensedndensed con sconsolidatedolidated financi afinanciall statemen tsstatements for the six m ofornt hthes en dsixed 3months0 June 2 0ended20 30 June 2020

GENERAL INFORMATION O2 Czech Republic Group (the “Group”) consists of O2 Czech Republic a.s. (the “Company”) and its subsidiaries. The Group is a leading integrated telecommunication provider in the Czech market providing fully convergent services. The Company has the form of a joint stock company and is incorporated and domiciled in the Czech Republic. The address of its registered office is Za Brumlovkou 266/2, Prague 4, 140 22, Czech Republic. As at 30 June 2020, the majority share (81.06 %) of the Company’s share capital was held indirectly by Mr. Petr Kellner through companies PPF Telco B.V., PPF A3 B.V. and PPF

CYPRUS MANAGEMENT Ltd. – companies from the PPF group, which is controlled by Mr. Petr Kellner.

Translation from the Czech original. O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

21 O2O2 CCzechzech R eRepublicpublic a.s. a.s. 3 O2 Czech Republic a.s. InterimInterim co condensedndensed con sconsolidatedolidated financi afinanciall statemen tsstatements for the six m ofornt hthes en dsixed 3months0 June 2 0ended20 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

Petr Kellner.

Translation from the Czech original. O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

22 O2 Czech Republic a.s. O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

23 O2 Czech Republic a.s. O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

24 O2 Czech Republic a.s. O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

1 ’ rowns (“CZK”), if not stated otherwise.

’ – –

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

25 O2 Czech Republic a.s. O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

’ rowns (“CZK”), if not stated otherwise.

’

– –

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

26 O2 Czech Republic a.s. O2 CCzecheh eRepublici a.s. a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interimnteri o condensedndensed on sconsolidatedoidated finani afinancial stateen tsstatements for the si ofornt hthes en dsixed months ne ended 30 June 2020

refeted in the hiher iairent oss of finania assets in aordane with the ethodoo for aatin eeted redit osses in aordane with (see ote 1 ).

he ro assessed indiators of ossie iairent of assets in aordane with the reireents of . he ro has not identified an sinifiant iairent of assets and does not reord an sinifiant ssidies or other ontritions in onnetion with the C andei. he ro rear onitors the iat of the C andei on the ro’s finania riss and does not onsider additiona disosres to e neessar in aordane with the reireents of inania nstrents isosres. ’ he ro aso introded a ner of oerationa easres (in artiar, it enaed hoeoffies for eoees and inreased rotetie and hieni easres at the worae), whih were neessar to ensre the roision of a series een drin the rowns (“CZK”), if not stated otherwise. oner dration of the easres annoned. esite the diffit aret sitation ased the C andei, the Coan sessf refinaned a an oan. he ro onsiders its rrent finania resores to e sffiient to ensre the nrestrited ontinane of its oerations. eent inforation eents reonised the ro are as foows • Ceh ei o oie seent – oie teeoniation and data series roided the Coan and ai, s.r.o. ’ o fied seent – teeoniation and data series sin fied networ and ii infrastrtre, C series roided the Coan and other ssidiaries in the ro edin ai, s.r.o. • – oa ei – teeoniation and data series roided oaia, s.r.o – and siness eries, a.s. he oeratin rests of a the seents to the ee of ross arin are rear ontroed and reiewed the hief oeratin deision aer who hods the ower to ae deisions aot resore aoation to the seents and to assess their erforane. eratin rests eow the ee of ross arin and aoation of resores are ontroed and reiewed the Company’s anaeent at the entire seent ee. nterseent riin rates in and were deterined on the sae asis as rates sed for other oie oerators.

ransation fro the Ceh oriina.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

27 O2 CCzecheh eRepublici a.s. a.s. O2 CCzech Republicp as a.s. Interimnteri o condensedndensed on sconsolidatedoidated finani afinancial stateen tsstatements for the si ofornt hthes en dsixed months ne ended 30 June 2020 Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020

refeted in the hiher iairent oss of finania assets in aordane with the o s mons C p oa mnaon op ethodoo for aatin eeted redit osses in aordane with (see ote n n p C s

). n C mon o ns he ro assessed indiators of ossie iairent of assets in aordane with the Cos o sas Co reireents of . he ro has not identified an sinifiant iairent of assets oss man and does not reord an sinifiant ssidies or other ontritions in onnetion with nom om non the C andei. he ro rear onitors the iat of the C ommnaon ss andei on the ro’s finania riss and does not onsider additiona disosres to Capasaon o asss e neessar in aordane with the reireents of inania nstrents oss n Co isosres. anns o ns as he ro aso introded a ner of oerationa easres (in artiar, it enaed paon an amosaon hoeoffies for eoees and inreased rotetie and hieni easres at the worae), whih were neessar to ensre the roision of a series een drin the ns oner dration of the easres annoned. nom om non ommnaon ss esite the diffit aret sitation ased the C andei, the Coan Capasaon o asss sessf refinaned a an oan. he ro onsiders its rrent finania resores to oa onsoa oss e sffiient to ensre the nrestrited ontinane of its oerations. anns o ns as paon an amosaon eent inforation paon an amosaon eents reonised the ro are as foows mosaon o oss o oan onas • Ceh ei mpamn oss on nonn asss pan po o oie seent – oie teeoniation and data series roided the Coan and ai, s.r.o. ns pns ns nom o fied seent – teeoniation and data series sin fied networ and ii infrastrtre, C series roided the Coan and other ssidiaries in the nana nompns ro edin ai, s.r.o. nana oss a o pooss o nsmns • oa ei – teeoniation and data series roided oaia, s.r.o aon o sn y mo and siness eries, a.s. o o a Copoa nom a he oeratin rests of a the seents to the ee of ross arin are rear o o po

ontroed and reiewed the hief oeratin deision aer who hods the ower to ae deisions aot resore aoation to the seents and to assess their oa asss erforane. eratin rests eow the ee of ross arin and aoation of oa as resores are ontroed and reiewed the Company’s anaeent at the entire seent ee.

nterseent riin rates in and were deterined on the sae asis as rates sed for other oie oerators.

ransation fro the Ceh oriina. ansaon om C ona

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

28 O2 CCzech Republicp as a.s. C p as Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 nm onns onsoa nana samns o s mons n n

o s mons C p oa mnaon op ns n n p C s n oon a ns om onas soms a saa no n C mon o pmay oap smns opan smns an pos po a aso ns ns oas na onaon o ns o os sos n Cos o sas Co smn anayss n s o oss man nom om non o s mons n n ommnaon ss C oa naop oa n Capasaon o asss n C mon p p mnaon op oss n Co o onaon anns o ns as o ss an paon an amosaon nn an aa o mnaon ns ns om sa o pmn nom om non nana ss ommnaon ss mo ns Capasaon o asss oa mo ns oa onsoa oss anns o ns as o ss paon an amosaon aa ss nn an son paon an amosaon C mosaon o oss o oan ns om sa o pmn onas ns mpamn oss on nonn asss oa ns pan po oa ns ns pns ns nom

nana nompns nana oss a o pooss o nsmns aon o sn y mo o o a Copoa nom a o o po

oa asss oa as

n op an psnaon o ns an os o sas om an ss an pmn posy n n mo smn Cny op psns m n smn s snss na o s pos an ss nomaon o ompaa po as as

ansaon om C ona ansaon om C ona

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

29 O2 CCzech Republicp as a.s. O2 CCzech Republicp as a.s. Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020

nana nompns nana oss a o pooss o nsmns aon o sn y mo o o a Copoa nom a o o po

oa asss oa as

n op an psnaon o ns an os o sas om an ss an pmn posy n n mo smn Cny op psns m n smn s snss na o s pos an ss nomaon o ompaa po as as

ansaon om C ona ansaon om C ona

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

30 O2 CCzech Republicp as a.s. O2 CCzech Republicp as a.s. C p as Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 nm onns onsoa nana samns o s mons n n

ns o s mons n n oan paons o maoonom naos an oass o C oa naop oa n opmn as a s o s mass a o oa o C n oon a ns om onas soms a saa no n C mon p p mnaon op panm op sa opoa soms no sa smns aon o pmay oap smns opan smns an pos po a aso o onaon p mpa o C panm on n smn an ssny ns oas na onaon o ns o os sos n o ss an mo p osss o a smn an no aon aos snaos smn anayss n s o nn an aa o opmn op aso mo mpa o sa ans o o mnaon ma s o C panm n sp o asssan o o o s mons n n ns om sa o pmn os C oa naop oa n nana ss n C mon p p mnaon op mo ns as no snan nas n s o o nana asss o C o onaon oa mo ns panm o ss an

nn an aa ns o son an anns p sa o ss o mnaon aa ss ns om sa o pmn n C mon o s mons o s mons nn an son nana ss n n n n C mo ns ns a ns om sa o pmn sons oa mo ns ns

oa ns oa sons a o ss

aa ss oa ns ns an o sons n a on a on ns pa y nn an son Company o s saos n a oa o os a an C n op ny sos a spaa aoy o ns om nana s many nn ns aan o ns n amon o o popos ns C p ns om sa o pmn om nsan an pos o on saon o sas posy n n mo sa a nomna a o C an n amon o C p sa a ns ns mo op as aoaon o mo ns o ssay amy so n nomna a o C no aan o ns as pa n aan o oa ns smn o C p pa o ns as mo om aoy o ss an ns as paya on ay appoa o po an

o aoy nn an aa C mon an o mo ns C mon op onmaon o amon o na n o pposs o smn oa ns aso an psnaon o n om sa o an ss an pmn s o pa aans as a a nna na n oo pa p oam a s y om ay o n nomaon o ompaa po as as

n n psan o son o nna na n ns n nom a amon o C p sa a nomna a o C an n amon o C n C mon o s mons o s mons p sa a nomna a o C om po C o C n n n n om po os aans aan o ns y n oa nom a pns onsss o aan p sa C o C om ns p sa C o C Cn nom a a s o smn as a o aan an n aon o aan C p nom a a sa as pa o ns on asy sas n amon o C mon nom a C mon man n an anns

nom as a aa sn pan a as n C nna na n o Company aso appo son o pa o p an n oaa sa pmm amon saos n oa amon o C mon C mon o a sa a nomna a o C amon o C mpamn osss on nana asss o a as aoa o sa a nomna a o C C o a as aoa pa o sa pmm as paya on n Company mpamn osss on nana asss o s a o ya n n os no a o amon a o paymn o sa pmm nas o C mon o po o s mons n n o asy sas s pa o sa pmm n amon o C mon C mon n aaon o p osss o as as a n C mon man n sa pmm an n aoan mns o op

ansaon om C ona ansaon om C ona ansaon om C ona

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

31 O2 CCzech Republicp as a.s. O2 CCzech Republicp as a.s. C p as Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 nm onns onsoa nana samns o s mons n n

o s mons n n oan paons o maoonom naos an oass o as anns p sa a aa y n n po aa o saos C oa naop oa n opmn as a s o s mass a o oa o C y aa nm o onay sas n ss n po n C mon p p mnaon op panm op sa opoa soms no sa smns aon o aa nm o sas as no aon aa o o onaon p mpa o C panm on n smn an ssny ans n asy sas n ya o ss an mo p osss o a smn an no aon aos snaos nn an aa o opmn op aso mo mpa o sa ans o o s mons o s mons o mnaon ma s o C panm n sp o asssan o o n n n n ns om sa o pmn os nm o onay sas osann osans nana ss po aa o saos n C mon mo ns as no snan nas n s o o nana asss o C as anns p sa C oa mo ns panm opy pan an pmn ns o son an anns p sa o ss n s mons n n op a asss a a os o aa ss n C mon o s mons o s mons C mon o po o s mons n n C mon nn an son n n n n sss a n oo a o C mon spos o y op n C ns a s mons n n o po o s mons n n ns om sa o pmn sons C mon ns oa ns oa sons a nan asss

ns an o sons n a on a on ns pa y oa ns n s mons n n op a nan asss a a Company o s saos n a oa o os a an os o C mon o po o s mons n n aan o ns n amon o o popos ns C p n op ny sos a spaa aoy o ns om nana s many nn ns C mon sss a n oo a o C mon spos o y sa a nomna a o C an n amon o C p sa a om nsan an pos o on saon o sas posy n n mo op n s mons n n o po o s mons n nomna a o C no aan o ns as pa n aan o ns mo op as aoaon o mo ns o ssay amy so n n C mon smn o C p pa o ns as mo om aoy o ss an ns as paya on ay appoa o po an onmaon o amon o na n o pposs o smn o aoy nn an aa C mon an o mo ns C mon op Cas an as ans aso an psnaon o n om sa o an ss an pmn s o pa aans as a a nna na n oo pa p oam a s y om ay o n nomaon o ompaa po as as n C mon n m Cas n n an aons an o as ans n n psan o son o nna na n ns n nom a Cas n n an aons an o as ans amon o C p sa a nomna a o C an n amon o C a pas p sa a nomna a o C om po C o C n C mon o s mons o s mons oa as an as ans n n n n om po os aans aan o ns y n oa nom a pns onsss o aan p sa C o C om ns p sa C o C omm nan as aaa o op amon o C mon Cn nom a a s o smn as a o aan an n aon o aan C p as a n as a m C mon nom a a sa as pa o ns on asy sas n amon o C mon nom a C mon man n an anns nnos

nom as a aa sn pan a as n C nna na n o Company aso appo son o pa o s a n nnos a sa n o an aoan o C mon p an n oaa sa pmm amon saos n oa amon o C mon as a m C mon n a o nnos o C mon o a sa a nomna a o C amon o C n asa a mpamn osss on nana asss o a as aoa o sa a nomna a o C C o a as aoa pa o sa pmm as paya on n Company nana as mpamn osss on nana asss o s a o ya n n os no a o amon a o paymn o sa pmm nas o C mon o po o s mons n n o asy sas s pa o sa pmm n amon o C mon n ay op n no a oan amn o nan a oan C mon n aaon o p osss o as as a n C mon man n sa pmm as s ya a n onm oan an a m o C mon an n aoan mns o op an a may o yas as no as o n aon o ansaon

ansaon om C ona ansaon om C ona ansaon om C ona

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

32 O2 CCzech Republicp as a.s. O2 CCzech Republicp as a.s. Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020

oan paons o maoonom naos an oass o as anns p sa a aa y n n po aa o saos opmn as a s o s mass a o oa o C y aa nm o onay sas n ss n po panm op sa opoa soms no sa smns aon o aa nm o sas as no aon aa o p mpa o C panm on n smn an ssny ans n asy sas n ya mo p osss o a smn an no aon aos snaos o opmn op aso mo mpa o sa ans o o s mons o s mons ma s o C panm n sp o asssan o o n n n n os nm o onay sas osann osans po aa o saos n C mon as no snan nas n s o o nana asss o C as anns p sa C panm opy pan an pmn ns o son an anns p sa n s mons n n op a asss a a os o n C mon o s mons o s mons C mon o po o s mons n n C mon n n n n sss a n oo a o C mon spos o y op n ns a s mons n n o po o s mons n n sons C mon oa sons a nan asss ns an o sons n a on a on ns pa y n s mons n n op a nan asss a a Company o s saos n a oa o os a an os o C mon o po o s mons n n aan o ns n amon o o popos ns C p C mon sss a n oo a o C mon spos o y sa a nomna a o C an n amon o C p sa a op n s mons n n o po o s mons n nomna a o C no aan o ns as pa n aan o n C mon ns as paya on ay appoa o po an onmaon o amon o na n o pposs o smn Cas an as ans pa aans as a a nna na n oo pa p oam a s y om ay o n n C mon n m Cas n n an aons an o as ans n n psan o son o nna na n ns n Cas n n an aons an o as ans amon o C p sa a nomna a o C an n amon o C a pas p sa a nomna a o C om po C o C oa as an as ans om po os aans aan o ns y n aan p sa C o C om ns p sa C o C omm nan as aaa o op amon o C mon s o smn as a o aan an n aon o aan C p as a n as a m C mon sa as pa o ns on asy sas n amon o C mon C mon man n an anns nnos nna na n o Company aso appo son o pa o s a n nnos a sa n o an aoan o C mon sa pmm amon saos n oa amon o C mon as a m C mon n a o nnos o C mon o a sa a nomna a o C amon o C n asa a o a as aoa o sa a nomna a o C C o a as aoa pa o sa pmm as paya on n Company nana as os no a o amon a o paymn o sa pmm o asy sas s pa o sa pmm n amon o C mon n ay op n no a oan amn o nan a oan C mon man n sa pmm as s ya a n onm oan an a m o C mon an a may o yas as no as o n aon o ansaon

ansaon om C ona ansaon om C ona

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

33 O2 CCzech Republicp as a.s. O2 CCzech Republicp as a.s. ech epublic a.s. Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 nterim condensed consolidated financial statements for the si months ended une

as anns p sa a aa y n n po aa o saos ns a o oan s as on n a nas y a ontingencies and litigations y aa nm o onay sas n ss n po man an m ooo as spas a n ns a aa nm o sas as no aon aa o anno o an o s a n Company a s a oa o The Group is involved in a number of legal disputes arising from standard business ans n asy sas n ya C mon as a m C mon o aaa interactions. ignificant developments which occurred throughout the first half of the ear om onm ay amn are described below. o s mons o s mons n n n n n p op sssy omp a pamn o o ans o I. VOLNÝ, a.s. – dispute concerning billion nm o onay sas osann osans pomssoy oan nos sn n oa amon o C mon The igh ourt in rague ordered a hearing to be held in eptember . po aa o saos n C mon mon may o o yas ns as an mas o a as anns p sa C an a as oos . uropean ommission – proceedings about networ sharing with Tobile

opy pan an pmn an Cny mon n ns a ay ay The ompan continues to communicate with the uropean ommission. ithin the ny n deadline of anuar the ompan sent the uropean ommission a response to n s mons n n op a asss a a os o sn oa p the statement of objections including an analsis of the benefits of networ sharing and C mon o po o s mons n n C mon sn oa p ualit of coverage in the ech epublic. n the opinion of the ompan the proceedings sss a n oo a o C mon spos o y op n sn p are currentl at such a stage that it is reasonable to assume that the uropean ommission s mons n n o po o s mons n n sn p will not adopt a substantive decision on the matter before the spring of . C mon The uropean ommission ma also stop the proceedings altogether even sooner. n p op omp a pamn o s ans o pomssoy oan nan asss The uropean ommission has ordered a hearing to be held in eptember . nos sn n oa amon o C mon C mon an mon may o o yas ns as an mas o a n s mons n n op a nan asss a a . ther an a as oos os o C mon o po o s mons n n C mon sss a n oo a o C mon spos o y No developments occurred in other significant legal disputes disclosed in the Group’s an Cny mon n ns a ay ay consolidated financial statements as at ecember that are part of the nnual op n s mons n n o po o s mons n ny n n C mon eport. The ompan is involved in other legal disputes where the amount disputed sn C oa C p reaches over milion. The aggregate value of all these pending disputes totals to sn C oa C p million. iss associated with individual disputes are not significant. Cas an as ans sn oa p n C mon n m sn oa p The ompan considers disclosing other information regarding the said litigations not Cas n n an aons an o as ans sn C C p advisable as it could endanger the strateg of the ompan in these cases. The ompan is convinced that all litigation ris has been appropriatel reflected in the financial Cas n n an aons an o as ans sn C C p statements. a pas oa as an as ans No Group’s assets serve as a collateral in connection with the drawing down of current ommitments oans omm nan as aaa o op amon o C mon apital ependiture contracted but not et included in the consolidated financial as a n as a m C mon op onns o pa o as os asn om a onm statements as at une amounted to million as at ecember nomna n C a oan ns a n o o ns a s million. The majorit of contracted amounts relates to the construction of nnos n nsmn s s a omnaon o sa ns a saps nomna telecommunications networs and upgrades and development of internal T sstems. n C n s a o ya n n op on n ns s a n nnos a sa n o an aoan o C mon a saps sn o pa o as os om n oan amn n elated part transactions as a m C mon n a o nnos o po om ay o ay o o ay . The Group’s objective is to maintain n asa a an appopa m o s an oan ns as n n s The companies Telco .. .. and NGNT td. through manamn onp as assss as as a n which r. etr ellner controls the Group are part of the Group. nana as n ay op n no a oan amn o nan a oan The Group invests in a variet of industries ranging from baning and financial as s ya a n onm oan an a m o C mon services to telecommunications real estate and biotechnolog. The Group operates an a may o yas as no as o n aon o ansaon in urope ussia sia and the .

ansaon om C ona ansaon om C ona Translation from the ech original.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

34 O2 CCzech Republicp as a.s. O2 Czechech eRepublicpublic a.s. a.s. O ech epulic a.s. Interimnm o condensednns on sconsolidatedoa nan afinancial samn sstatements o s m oforn thes n six months n ended 30 June 2020 Interimnterim co condensedndensed con sconsolidatedolidated financi afinanciall statemen tsstatements for the si m ofornt hthes en dsixed months une ended 30 June 2020 Interi condensed consolidated financial stateents for the si onths ended une

ns a o oan s as on n a nas y a ontingencies and litigations he Group proides serices to all related parties on coon coercial ters and man an m ooo as spas a n ns a at aret prices. Outstanding alances of receiales and liailities are unsecured, interest anno o an o s a n Company a s a oa o The Group is involved in a number of legal disputes arising from standard business free ecl. financial assets and liailities used for financing and the settleent occurs C mon as a m C mon o aaa interactions. ignificant developments which occurred throughout the first half of the ear either in cash or offsetting. he financial asset alances are tested for ipairent as om onm ay amn are described below. at the alance sheet date. s at une and as at eceer , no specific alloance or riteoff as incurred. n p op sssy omp a pamn o o ans o I. VOLNÝ, a.s. – dispute concerning billion pomssoy oan nos sn n oa amon o C mon he folloing significant transactions ere carried out ith related parties mon may o o yas ns as an mas o a The igh ourt in rague ordered a hearing to be held in eptember . an a as oos I. arent copan . uropean ommission – proceedings about networ sharing with Tobile an Cny mon n ns a ay ay he diidend and other distriutions declared during the si onths period ended The ompan continues to communicate with the uropean ommission. ithin the une to the shareholders fro the Group aounted to , illion ny n deadline of anuar the ompan sent the uropean ommission a response to sn oa p for the period of si onths ended une , illion. s at une the statement of objections including an analsis of the benefits of networ sharing and and eceer , the liailit fro diidends and other distriutions to sn oa p ualit of coverage in the ech epublic. n the opinion of the ompan the proceedings shareholders fro Group as full paid. sn p are currentl at such a stage that it is reasonable to assume that the uropean ommission sn p will not adopt a substantive decision on the matter before the spring of . II. IN a.s. The uropean ommission ma also stop the proceedings altogether even sooner. n p op omp a pamn o s ans o pomssoy oan The uropean ommission has ordered a hearing to be held in eptember . fter the spinoff of the opan in , ne usiness relations ere estalished ith nos sn n oa amon o C mon C mon an the copan IN a.s. through the purchase of fied line and oile mon may o o yas ns as an mas o a . ther telecounications serices and other serices. hese serices are proided on the asis an a as oos of the holesale agreeents concluded and represent an iportant ite of No developments occurred in other significant legal disputes disclosed in the Group’s interconnection costs for the Group. an Cny mon n ns a ay ay consolidated financial statements as at ecember that are part of the nnual ny n eport. The ompan is involved in other legal disputes where the amount disputed ongst the ost iportant ne relationships are the folloing holesale agreeents sn C oa C p reaches over milion. The aggregate value of all these pending disputes totals to sn C oa C p million. iss associated with individual disputes are not significant. a oile netor serices agreeent sn oa p he suect of the agreeent is the proision of oile netor serices offering coerage sn oa p The ompan considers disclosing other information regarding the said litigations not , G, G and L ithin the ech epulic. he agreeent also contains sn C C p advisable as it could endanger the strateg of the ompan in these cases. The ompan arrangeents aout the deelopent, operation and aintenance of the netor, the is convinced that all litigation ris has been appropriatel reflected in the financial sn C C p transfer capacit of the netor, ne serices, the etension of ne serices and statements. collocation. he agreeent has een concluded for a period of ears. he Group is No Group’s assets serve as a collateral in connection with the drawing down of current oliged to use the serices for a period of seen ears, that is until a . he total ommitments oans cost during the si onths period ended une as , illion for the si onths ended une , illion. apital ependiture contracted but not et included in the consolidated financial op onns o pa o as os asn om a onm statements as at une amounted to million as at ecember nomna n C a oan ns a n o o ns a s agreeent on access to the pulic fied counications netor socalled O million. The majorit of contracted amounts relates to the construction of n nsmn s s a omnaon o sa ns a saps nomna he suect of the O agreeent is access to the pulic fied counications netor telecommunications networs and upgrades and development of internal T sstems. n C n s a o ya n n op on n ns of IN, proision of the holesale serice of interconnection at the end point, and the a saps sn o pa o as os om n oan amn n holesale serice of access to pulicl aailale serices of electronic counications and elated part transactions po om ay o ay o o ay . The Group’s objective is to maintain related additional serices. he agreeent has een concluded for an indefinite period, here the opan pas onthl charges nuer of access points ultiplied unit an appopa m o s an oan ns as n n s The companies Telco .. .. and NGNT td. through price and undertaes to tae up at least , L lines for a period of seen ears manamn onp as assss as as a n which r. etr ellner controls the Group are part of the Group. after signing the agreeent, that is until a hich represents onl part of the The Group invests in a variet of industries ranging from baning and financial services to telecommunications real estate and biotechnolog. The Group operates in urope ussia sia and the .

ansaon om C ona Translation from the ech original. ranslation fro the ech original.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

35 O2 Czechech eRepublicpublic a.s. a.s. O2O Czechech eRepublicpulic a.s. a.s. Interimnterim co condensedndensed con sconsolidatedolidated financi afinanciall statemen tsstatements for the si m ofornt hthes en dsixed months une ended 30 June 2020 InterimInteri co condensedndensed con sconsolidatedolidated financi afinanciall stateen tsstatements for the si ofornt hthes en dsixed months une ended 30 June 2020

ontingencies and litigations he Group proides serices to all related parties on coon coercial ters and at aret prices. Outstanding alances of receiales and liailities are unsecured, interest The Group is involved in a number of legal disputes arising from standard business free ecl. financial assets and liailities used for financing and the settleent occurs interactions. ignificant developments which occurred throughout the first half of the ear either in cash or offsetting. he financial asset alances are tested for ipairent as are described below. at the alance sheet date. s at une and as at eceer , no specific alloance or riteoff as incurred. I. VOLNÝ, a.s. – dispute concerning billion he folloing significant transactions ere carried out ith related parties The igh ourt in rague ordered a hearing to be held in eptember . I. arent copan . uropean ommission – proceedings about networ sharing with Tobile he diidend and other distriutions declared during the si onths period ended The ompan continues to communicate with the uropean ommission. ithin the une to the shareholders fro the Group aounted to , illion deadline of anuar the ompan sent the uropean ommission a response to for the period of si onths ended une , illion. s at une the statement of objections including an analsis of the benefits of networ sharing and and eceer , the liailit fro diidends and other distriutions to ualit of coverage in the ech epublic. n the opinion of the ompan the proceedings shareholders fro Group as full paid. are currentl at such a stage that it is reasonable to assume that the uropean ommission will not adopt a substantive decision on the matter before the spring of . II. IN a.s. The uropean ommission ma also stop the proceedings altogether even sooner. The uropean ommission has ordered a hearing to be held in eptember . fter the spinoff of the opan in , ne usiness relations ere estalished ith the copan IN a.s. through the purchase of fied line and oile . ther telecounications serices and other serices. hese serices are proided on the asis of the holesale agreeents concluded and represent an iportant ite of No developments occurred in other significant legal disputes disclosed in the Group’s interconnection costs for the Group. consolidated financial statements as at ecember that are part of the nnual eport. The ompan is involved in other legal disputes where the amount disputed ongst the ost iportant ne relationships are the folloing holesale agreeents reaches over milion. The aggregate value of all these pending disputes totals to million. iss associated with individual disputes are not significant. a oile netor serices agreeent he suect of the agreeent is the proision of oile netor serices offering coerage The ompan considers disclosing other information regarding the said litigations not , G, G and L ithin the ech epulic. he agreeent also contains advisable as it could endanger the strateg of the ompan in these cases. The ompan arrangeents aout the deelopent, operation and aintenance of the netor, the is convinced that all litigation ris has been appropriatel reflected in the financial transfer capacit of the netor, ne serices, the etension of ne serices and statements. collocation. he agreeent has een concluded for a period of ears. he Group is oliged to use the serices for a period of seen ears, that is until a . he total ommitments cost during the si onths period ended une as , illion for the si onths ended une , illion. apital ependiture contracted but not et included in the consolidated financial statements as at une amounted to million as at ecember agreeent on access to the pulic fied counications netor socalled O million. The majorit of contracted amounts relates to the construction of he suect of the O agreeent is access to the pulic fied counications netor telecommunications networs and upgrades and development of internal T sstems. of IN, proision of the holesale serice of interconnection at the end point, and the holesale serice of access to pulicl aailale serices of electronic counications and elated part transactions related additional serices. he agreeent has een concluded for an indefinite period, here the opan pas onthl charges nuer of access points ultiplied unit The companies Telco .. .. and NGNT td. through price and undertaes to tae up at least , L lines for a period of seen ears which r. etr ellner controls the Group are part of the Group. after signing the agreeent, that is until a hich represents onl part of the The Group invests in a variet of industries ranging from baning and financial services to telecommunications real estate and biotechnolog. The Group operates in urope ussia sia and the .

Translation from the ech original. ranslation fro the ech original.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

36 O2O Czechech eRepublicpulic a.s. a.s. O2O Czechech eRepublicpulic a.s. a.s. InterimInteri co condensedndensed con sconsolidatedolidated financi afinanciall stateen tsstatements for the si ofornt hthes en dsixed months une ended 30 June 2020 InterimInteri co condensedndensed con sconsolidatedolidated financi afinanciall stateen tsstatements for the si ofornt hthes en dsixed months une ended 30 June 2020

he Group proides serices to all related parties on coon coercial ters and total paent. he total cost for the si onths ended une as , at aret prices. Outstanding alances of receiales and liailities are unsecured, interest illion for the si onths ended une , illion. free ecl. financial assets and liailities used for financing and the settleent occurs either in cash or offsetting. he financial asset alances are tested for ipairent as c agreeent on access to end points socalled O at the alance sheet date. s at une and as at eceer , no specific IN enales the Group access to end points, hich include the proision of transfer alloance or riteoff as incurred. capacit eteen the end point of the electronic counications netor and the transfer point located in a collocation ithin the area of a single region. he opan he folloing significant transactions ere carried out ith related parties ill pa oneoff epenses for estalishent, speed change, rela or relocation of the end point and regular onthl fees for the sections proided ased on transfer speed. he I. arent copan total cost for the si onths ended une as illion for the si onths ended une illion. he diidend and other distriutions declared during the si onths period ended une to the shareholders fro the Group aounted to , illion III. .V. for the period of si onths ended une , illion. s at une and eceer , the liailit fro diidends and other distriutions to In accordance ith capital optiisation and ris anageent the susidiar O loaia, shareholders fro Group as full paid. s.r.o. entered in une into an agreeent for the issue and purchase of certificates, for hich the portfolio of receiales fro the instalent sale of oile hardare seres II. IN a.s. as the underling asset. he issue enaled O loaia, s.r.o. to iediatel otain financial resources in the aount of , illion, hich otherise ould e fter the spinoff of the opan in , ne usiness relations ere estalished ith collected fro the instalent sales on an ongoing asis. he copan O loaia, s.r.o. the copan IN a.s. through the purchase of fied line and oile transferred all the enefits and riss arising fro transferred receiales ith a oo alue telecounications serices and other serices. hese serices are proided on the asis of , illion to the certificate holder throught the issue of the certificate of the holesale agreeents concluded and represent an iportant ite of („econoic transfer of receiales without recourse“). his fulfilled the conditions for interconnection costs for the Group. derecognition of financial assets in accordance ith I inancial Instruents and the Group derecognised the transferred receiales at the date of sale. espite the transfer ongst the ost iportant ne relationships are the folloing holesale agreeents of ris, the copan O loaia, s.r.o. reained the legal oner of the receiales and, a oile netor serices agreeent in accordance ith the contract, continues to anage and collect these receiales. he he suect of the agreeent is the proision of oile netor serices offering coerage sale has no ipact on the relationship eteen O loaia, s.r.o. and its custoers. s , G, G and L ithin the ech epulic. he agreeent also contains at the date of sale, the Group recognised oneoff cost related to the sale of receiales of arrangeents aout the deelopent, operation and aintenance of the netor, the illion in inance cost and a liailit for anageent and collection of receiales transfer capacit of the netor, ne serices, the etension of ne serices and of illion, hich the Group ill accrue to reenues for the period of collocation. he agreeent has een concluded for a period of ears. he Group is adinistration of transferred receiales. oliged to use the serices for a period of seen ears, that is until a . he total usidiaries, associates and oint entures cost during the si onths period ended une as , illion for the si onths ended une , illion. he Group held interests in the folloing entities as at une and eceer agreeent on access to the pulic fied counications netor socalled O he suect of the O agreeent is access to the pulic fied counications netor Group’s interest as at of IN, proision of the holesale serice of interconnection at the end point, and the usidiaries une eceer ountr of ctiit ethod of holesale serice of access to pulicl aailale serices of electronic counications and incorporation consolidation related additional serices. he agreeent has een concluded for an indefinite period, . O loaia, loa oile telephon, onsolidated here the opan pas onthl charges nuer of access points ultiplied unit s.r.o. epulic internet and data full price and undertaes to tae up at least , L lines for a period of seen ears transission consolidation after signing the agreeent, that is until a hich represents onl part of the serices

ranslation fro the ech original. ranslation fro the ech original.

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

37 O2O Czechech eRepublicpulic a.s. a.s. O2 Czechech eRepublicpuic s a.s. InterimInteri co condensedndensed con sconsolidatedolidated financi afinanciall stateen tsstatements for the si ofornt hthes en dsixed months une ended 30 June 2020 Interimnteri co condensednense con sconsolidatedoite innci financial stteen tsstatements or the si ofornt hthes en sixe months une ended 30 June 2020

total paent. he total cost for the si onths ended une as , i ech epuic oie teephon onsoite illion for the si onths ended une , illion. sro internet n t (u trnsission consoition) c agreeent on access to end points socalled O serices IN enales the Group access to end points, hich include the proision of transfer sro ech epuic iit teeision onsoite capacit eteen the end point of the electronic counications netor and the (u transfer point located in a collocation ithin the area of a single region. he opan consoition) ill pa oneoff epenses for estalishent, speed change, rela or relocation of the end erices ech epuic nortion onsoite point and regular onthl fees for the sections proided ased on transfer speed. he sro technoo serices (u total cost for the si onths ended une as illion for the si onths consoition) ended une illion. ot trt p ech epuic trtup un onsoite eeopent (u III. .V. s consoition) In accordance ith capital optiisation and ris anageent the susidiar O loaia, usiness o oie teephon onsoite s.r.o. entered in une into an agreeent for the issue and purchase of certificates, erices s epuic internet n t (u trnsission consoition) for hich the portfolio of receiales fro the instalent sale of oile hardare seres serices as the underling asset. he issue enaled O loaia, s.r.o. to iediatel otain financial resources in the aount of , illion, hich otherise ould e es sro ech epuic ectronic ses onsoite collected fro the instalent sales on an ongoing asis. he copan O loaia, s.r.o. reporting (“EET”) (u transferred all the enefits and riss arising fro transferred receiales ith a oo alue soution proier consoition) of , illion to the certificate holder throught the issue of the certificate innci ech epuic innci erices onsoite erices sro intereir (u („econoic transfer of receiales without recourse“). his fulfilled the conditions for consoition) derecognition of financial assets in accordance ith I inancial Instruents and the nine onsoite Group derecognised the transferred receiales at the date of sale. espite the transfer uiico ech epuic couniction (u of ris, the copan O loaia, s.r.o. reained the legal oner of the receiales and, sro in accordance ith the contract, continues to anage and collect these receiales. he ptor consoition) sale has no ipact on the relationship eteen O loaia, s.r.o. and its custoers. s rt hoe ech epuic roier o hoe onsoite securit sro securit euipent (u at the date of sale, the Group recognised oneoff cost related to the sale of receiales of n serices consoition) illion in inance cost and a liailit for anageent and collection of receiales of illion, hich the Group ill accrue to reenues for the period of ech epuic roier o onsoite adinistration of transferred receiales. orportion trnsport (u sro teetics serices consoition)

usidiaries, associates and oint entures ei ech epuic otwre onsoite he Group held interests in the folloing entities as at une and echnooies eeopent n (u eceer sro ses consoition) ssocites Group’s interest as at usidiaries une eceer ountr of ctiit ethod of První ech epuic ertiiction ot incorporation consolidation certifikační serices consoite . O loaia, loa oile telephon, onsolidated utorit s (iteri) s.r.o. epulic internet and data full G ech epuic uction ses n ot transission consolidation spo sro isor serices consoite serices (in nruptc)

ranslation fro the ech original. rnstion ro the ech oriin

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

38 O2 Czeche eRepublicpi a.s. Interimnteri o condensednene on consolidatedoite inni financial tteen tstatements or te i ofornt the en sixe months ne ended 30 June 2020

oint ventre

Teo oie e epi oie virt onoite ČR s.r.o. netor opertor (eit or prepi ervie eto) Teo oie ov oie virt ot ovi epi netor opertor onoite ro or prepi ervie (iteri)

inni intrent ere t ir ve

Te rop te ooing inni intrent ere t ir ve

n iion ne eeer inni et inni erivtive interet (ege onting) inni erivtive oreign rren (tring) inni intrent t ir ve trog proit or o inni intrent t ir ve trog oter opreenive inoe Tot inni et ere t ir ve

inni iiitie inni erivtive – oreign rren (tring) inni erivtive – interet (tring) inni erivtive interet (ege onting) Tot inni iiitie ere t ir ve

t ne n t eeer te rop e eit eritie n on provie iie eve ir ve in te ir ve ierr n inni erivtive iie eve

Te rop te te ir ve o te erivtive inni intrent on te i o ionte o oe (ing ret rte)

inni intrent t ir ve trog proit or o repreent te on provie i ine n eee erivtive in te or o n option to onvert te et into eit n orne it te ri ontrt een ee or ereent oe Te ir ve eterine te inoe ppro ing te ionte o eto ting into ont te intrini ve o te onverion option o ere ionte t te iont rte reeting teir ri Te intrini ve o te onverion option eterine it repet to te opn’ etite ve n te proiit o option tivtion

inni intrent t ir ve trog oter opreenive inoe repreent eit eritie Teir ir ve eterine te inoe ppro ing te ionte o eto o ere ionte t te iont rte reeting teir ri

Trntion ro te e origin

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

39 O2 Czeche eRepublicpi a.s. O2 Czech Republic a.s. Interimnteri o condensednene on consolidatedoite inni financial tteen tstatements or te i ofornt the en sixe months ne ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

oint ventre Teo oie e epi oie virt onoite ČR s.r.o. netor opertor (eit or prepi ervie eto) Teo oie ov oie virt ot ovi epi netor opertor onoite ro or prepi ervie (iteri) inni intrent ere t ir ve Te rop te ooing inni intrent ere t ir ve n iion ne eeer inni et inni erivtive interet (ege onting) inni erivtive oreign rren (tring) inni intrent t ir ve trog proit or o inni intrent t ir ve trog oter opreenive inoe Tot inni et ere t ir ve inni iiitie ’ inni erivtive – oreign rren (tring) inni erivtive – interet (tring) ‘ inni erivtive interet (ege onting) Tot inni iiitie ere t ir ve t ne n t eeer te rop e eit eritie n on provie iie eve ir ve in te ir ve ierr n inni erivtive iie eve Te rop te te ir ve o te erivtive inni intrent on te i o ionte o oe (ing ret rte) inni intrent t ir ve trog proit or o repreent te on provie i ine n eee erivtive in te or o n option to onvert te et into eit n orne it te ri ontrt een ee or ereent oe Te ir ve eterine te inoe ppro ing te ionte o eto ting into ont te intrini ve o te onverion option o ere ionte t te iont rte reeting teir ri Te intrini ve o te onverion option eterine it repet to te opn’ etite ve n te proiit o option tivtion

inni intrent t ir ve trog oter opreenive inoe repreent eit eritie Teir ir ve eterine te inoe ppro ing te ionte o eto o ere ionte t te iont rte reeting teir ri

Trntion ro te e origin

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

40 O2 Czech Republic a.s. O2 Czech Republic a.s. Interim condensed consolidated financial statements for the six months ended 30 June 2020 Interim condensed consolidated financial statements for the six months ended 30 June 2020

Jindř Tomáš Kouřil

’ ‘

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

41 Declaration of persons

responsible for the

Half-Year Report

O2 Czech Republic a.s. | 2020 Half-Year Report Declaration of persons responsible for the Half-Year Report

Jindřich Fremuth, Chairman of the Board of Directors of O2 Czech Republic a.s. and

Tomáš Kouřil, Vice-chairman of the Board of Directors of O2 Czech Republic a.s. hereby declare that, to their best knowledge, the consolidated Half-Year Report gives a true and faithful reflection of the financial situation, business and the results of the Company and its consolidated whole for the past accounting period, and of the projection on the future development of the financial situation, business and results.

17 August 2020

Jindřich Fremuth Tomáš Kouřil Chief Executive Officer Chief Financial Officer Chairman of the Board of Directors Vice-chairman of the Board of Directors

O2 Czech Republic a.s. | 2020 Half-Year Report | Translation from the Czech original

43 O2 Czech Republic a. s.

Za Brumlovkou 266/2

140 22 Praha 4

t.: 0800 02 02 02