ITV delivers strong operational performance in an uncertain economic environment 2017 Full Year Results 28 February 2018 The Voice UK Agenda

1. Key Messages & Initial Impressions Carolyn McCall

2. Operating & Financial Review Ian Griffiths

3. Outlook for 2018 Carolyn McCall

4. Q&A

Coronation Street 2 Key Messages & Initial Impressions Carolyn McCall

I’m A Celebrity…Get Me Out Of Here! Key Messages

 Financial performance delivers as expected  ITV delivered a strong operating performance in a challenging environment in 2017 − Linear viewing share up for second consecutive year − Significant growth in online viewing and revenue − ITV Studios delivered strong revenue growth  Good performance has created a solid foundation  Rapidly changing industry creates opportunities and challenges  Strategy refresh for what ITV needs to be in 3 and 5 years

Emmerdale – Soap of the year 4 Places visited so far:

 Getting to know ITV  Offices: London, Manchester, Leeds, − people and places New York

 Meeting key stakeholders  Newsrooms: Meridian, Granada, Yorkshire  Strategic refresh well underway  Coronation Street and Emmerdale

 Production Companies: Mammoth, Shiver, Twofour, ITV America and Talpa

5  Great culture – talented and creative people

 Strong consumer brand

 ITV’s unique proposition of mass audiences – the power of TV

 Direct to Consumer relationships through the ITV Hub

 Studios is a scaled international business with a healthy pipeline of new and returning programmes

 Integrated producer broadcaster

 Strong balance sheet

6 Data Strategy

Operating Model

7 Operating & Financial Review Ian Griffiths ITV Horse Racing Dancing on Ice 9 ITV NAR 1,591 1,672 (5) • Good growth in Non-NAR partly offsetting decline in NAR Online, Pay & Interactive 248 231 7

SDN (external) 70 67 4 • ITV NAR down 5% as guided Other commercial income 166 162 2 • Double-digit growth in high margin VOD Non-NAR revenue 484 460 5 • Schedule costs lower in non-sport year – Total revenue 2,075 2,132 (3) maintained investment in original commissions Schedule costs (1,025) (1,050) (2) • Cost savings offset by investment in the ITV Other costs (451) (440) 3 Hub and Pay/SVOD platforms Broadcast & Online EBITA 599 642 (7) • Margins down 1% to 29% EBITA margin 29% 30%

10 11 21m registered users Market leader in live simulcast

Requests and simulcast growing 75% of UK’s 16-24s registered faster than C4 and BBC catch-up

Only commercial PSB broadcaster Available on 29 platforms to launch SVOD service, Hub+

Over 250k subscribers for 27m app downloads BritBox US and Canada

12 FY 2017 FY YOY % Category (£m) change Retail 324 (3) 5% Entertainment and Leisure 158 (4) 1% Finance 154 - 0% Cosmetics and Toiletries 112 (5) Food 101 (23) -5% (4)% Cars and Car Dealers 100 2 (7)% Telecommunications 86 23 -10% (9)% Airlines, Travel and Holidays 80 (3) Publishing and Broadcasting 69 (10) -15% Household Stores 53 (12) Q1 Q2 Q3 Q4 Others 354 (8) Quarterly YOY Moving Annual Total Total 1,591 (5) • NAR down 5% as guided • Total advertising down 3% including sponsorship and VOD • Retail down 3% - high street weak, supermarkets increased spending • FMCG advertisers have been reducing their spend but allocating more back to TV • Cars and Telecommunications up year on year driven by new product launches • Digital businesses continue to build brands on TV, including Netflix, Amazon, Twitter and Facebook • Q1 2018 continues the growth seen in Q4 – H1 expected to be up, helped by the football

13 • Total revenue up 13% Studios UK 692 626 11 • Good growth across all parts of the business ITV America 313 235 33 • Organic revenue, excluding currency, grew 7% Studios RoW 390 355 10 • Studios UK - healthy revenue growth driven by Global Entertainment 187 179 4 entertainment

Total Studios revenue 1,582 1,395 13 • ITV America - strong growth from entertainment and scripted Total Studios costs (1,339) (1,152) 16 • Studios RoW - benefitted from growth in UK and ITV Studios EBITA 243 243 - Talpa formats in Australia, France and the Nordics EBITA margin 15% 17% • Global Entertainment - good slate of programmes, Internal – ITVS to ITV Network 523 463 13 especially scripted

External revenue 1,059 932 14 • Margin impacted by genre mix on new shows Total revenue 1,582 1,395 13 • £43m revenue and £7m EBITA benefit from FX

14 2017 ITV Studios Total Revenue (£m)

43 4 135 48 293

1,582

1,395 (336)(336)

FY 2016 Non-returning New shows (potential to Recommissions Acquisitions FX Other FY 2017 return)

• Managing the portfolio of new and returning shows is key to Studios growth • New shows include Bancroft, The Voice Kids UK, 5 Gold Rings, Love Island Germany, Big Star’s Little Star US, Snowpiercer • Recommissions include The Voice UK, I’m A Celebrity, Love Island UK, Hell’s Kitchen US, Aber Bergen

15 *Organic excludes all acquisitions since 2012; ROI is based on EBITA and consideration paid 16 Entertainment Hours Scripted Hours • Good growth in scripted content in UK and UK US & RoW 300 US with new and returning series 3,000 250 − Victoria, Cold Feet, Unforgotten, 200 2,000 Snowpiercer, Good Witch 150 − Acquisition of Tetra and Cattleya in 2017 100 1,000 50 strengthens international scripted

0 0 business 2015 2016 2017 2015 2016 2017 • More entertainment formats lead to growth Returning Scripted Hours Returning Entertainment Hours across the business − Love Island, The Voice, The Voice Kids, +277% +84% 120 2,500 I’m A Celebrity Get Me Out Of Here!, 100 2,000 Hell’s Kitchen, The Chase, Come Dine 80 1,500 with Me 60 1,000 40 • Revenue mix impacts margins 20 500 − New shows, especially scripted, have - - lower margins in the early years 2015 2016 2017 2015 2016 2017

*Data incudes acquisitions 17 2017 Adjusted EBITA (£m)

22 29 8 25 6 (15) (37) 885 (81) 842

FY 2016 NAR Network Online, Pay & ITV Studios The Voice Of FX & Other Cost Savings Investments FY 2017 Schedule Interactive Underlying China

• NAR biggest impact on 2017 profit • Offset by delivering cost savings and lower schedule costs • Continued to invest in the Hub, ITV Box Office and Studios creative/scripted • Good underlying profit growth in Studios, but The Voice of China included in 2016 comparatives

18 19 P&L Cash

Around £100m with £60m of regular capex and Schedule Around £1,055-60m – increase of around £30m and Capex £40m relating to the London property move in Costs weighted to H1 due to the Football World Cup 2018

Total of around £15-£20m – new property, online Profit to Around 85% – continued strong cash flow Investments and initial data investments cash generation

Adjusted £80m deficit funding contribution – no change, Around £35m – broadly unchanged from 2017 Pension Interest subject to agreeing triennial valuation

Adjusted effective tax rate around 19%, unchanged Exceptional and expected to be sustainable over the medium Cash cost of exceptionals will be around £85m Tax Items term

Translation impact of FX, assuming rates remain Foreign at current levels, will negatively impact revenue Exchange by £35m and profit by £5m

Exceptional Around £85m, mainly due to acquisition accounting Items and London office and Studios moves

20 Outlook for 2018 Carolyn McCall

Good Morning Britain Coming up On ITV Coming up Off ITV Coming up internationally

22 Produced by Premiering on ITV Studios Significant advertising and Amazon Prime in US sponsorship opportunities

7 episodes

31 matches on ITV UK broadcast 2018 FIFA World Cup expected in H2

Multiple commercial partnerships secured Extended run on ITV2

Enhanced digital offerings Format sold to 6 including daily podcasts countries Vanity Fair 23  Strategic refresh in progress

 In the meantime we remain very focused on the business

 Strong culture - talented and creative people

 Strong balance sheet and healthy cash flow

 Committed to our ordinary dividend policy

 Solid foundation for the future

24 Q&A Appendix Full Year Results 2017

26 12 months to 31 December 2017 (£m) 2016 (£m) Change Commissions (563) (564) 0% Sport (82) (111) 26% Acquired (38) (37) (3)% ITN News and Weather (48) (48) - Total ITV main channel (731) (760) 4% Regional news and non-news (72) (70) (3)% ITV Breakfast (42) (44) 5% Total ITV incl. regional & Breakfast (845) (874) 3% ITV2, ITV3, ITV4, ITV Encore, ITVBe, CITV (180) (176) (2)% Total schedule costs (1,025) (1,050) 2%

27 12 months to 31 December 2017 (£m) 2016 (£m) Change Organic change* Studios UK 692 626 11% 9% Studios US 313 235 33% 28% Studios RoW 390 355 10% (8)% Global Entertainment 187 179 4% 1% Total revenue 1,582 1,395 13% 7%

*At constant currencies, and excluding revenue from 2017 acquisitions 28 12 months to 31 December 2017 (£m) 2016 (£m) Change Adjusted EBITA 842 885 (5)% Internally generated amortisation (5) (12) 58% Financing costs (33) (26) (27)% Share of losses on JVs and associates (4) - 100% Profit before tax 800 847 (6)% Tax (154) (160) 4% Profit after tax 646 687 (6)% Non-controlling interests (4) (4) 0% Earnings 642 683 (6)% EPS (p) 16.0p 17.0p (6)% Diluted EPS (p) 16.0p 17.0p (6)%

29 12 months to 31 December 2017 (£m) 2016 (£m) Change EBITA 810 857 (5)% Exceptional items (operating) (153) (164) (7)% Amortisation and impairment (102) (89) (15)% Operating profit 555 604 (8)% Net financing costs (50) (51) 2% Share of losses on JVs and associates (4) - 100% Gain on sale of non-current assets and subsidiaries (1) - 100% (non-operating exceptional items) Profit before tax 500 553 (10)% Tax (87) (100) 13% Profit after tax 413 453 (9)% Loss after tax for the period from discontinuing operations - (1) 100% Non-controlling interests (4) (4) 0% Earnings 409 448 (9)% EPS (p) 10.2p 11.2p (9)% Diluted EPS (p) 10.2p 11.1p (8)%

30 12 months to 31 December Reported (£m) Adjustments (£m) Adjusted (£m)

EBITA* 810 32 842 Exceptional items (operating) (153) 153 - Amortisation and impairment (102) 97 (5) Operating profit 555 282 837 Net financing costs (50) 17 (33) Share of losses on JVs and Associates (4) - (4) Gain on sale of non-current assets and subsidiaries (1) 1 - (non-operating exceptional items) Profit before tax 500 300 800 Tax (87) (67) (154) Profit after tax 413 233 646 Non-controlling interests (4) - (4) Earnings 409 233 642 Number of shares (weighted average)** 4,006 - 4,006 Earnings per share 10.2p 16.0p

*Adjusted EBITA includes the benefit of production tax credits; **Diluted number of shares is 4,017m 31

12 months to 31 December 2017 (£m) 2016 (£m) Acquisition-related expenses (96) (131) Restructuring and property-related cost (30) (14) Insured trade receivables provision (27) - Pension curtailment - (19) Total operating exceptional items (153) (164) Non-operating exceptional items (1) - Total exceptional items (154) (164)

32 12 months to 31 December 2017 (£m) 2016 (£m) £161m Eurobond at 6.125% coupon Jan 17 - (7) €600m Eurobond at 2.125% coupon Sept 22 (11) (10) €500m Eurobond at 2% coupon Dec 23* (15) (1) £630m Revolving Credit Facility (4) (2) £150m and £100m Bilateral loans - (2) Financing costs directly attributable to loans and bonds (30) (22) Cash-related net financing costs (2) (3) Amortisation of bonds (1) (1) Adjusted financing costs (33) (26) Mark-to-market on swaps and foreign exchange - (3) Imputed pension interest (9) (5) Unrealised foreign exchange and other net financial losses (8) (17) Net financing costs (50) (51)

* effective swapped coupon of 3.5% 33 12 months to 31 December 2017 (£m) 2016 (£m) Profit before tax 500 553 Production tax credits 32 28 Exceptional items 154 164 Amortisation and impairment* 97 77 Adjustments to net financing costs 17 25 Adjusted profit before tax 800 847 Tax charge (87) (100) Production tax credits (32) (28) Charge for exceptional items (12) (15) Charge in respect of amortisation and impairment* (19) (11) Charge in respect of adjustments to net financing costs (4) (6) Adjusted tax charge (154) (160) Effective tax rate on adjusted profits 19% 19% Total cash tax paid (including receipt of production tax credits) 95 90 Total adjusted cash tax paid (excluding the receipt of production tax credits) 118 126

*In respect of intangible assets arising from business combinations and investments. Also reflects the cash tax benefit of tax deductions for US goodwill. 34 Additional Expected Initial Total expected Total maximum consideration future Expected Company consideration consideration** consideration** paid in 2017 payments* payment dates (£m) (£m) (£m) (£m) (£m)

2017

Various 81 - 44 125 2020-2024 418

Total for 2017 81 - 44 125 418

Total for 2012-2016 860 91 248 1,199 2018-2021 1,923

Total 941 91 292 1,324 2,341

• Of £292m expected future payments, £161m recorded on the balance sheet to date

* Undiscounted and adjusted for foreign exchange. All future payments are performance related. ** Undiscounted and adjusted for foreign exchange, including initial consideration and excluding working capital adjustments. 35

2017 (£m) 2016 (£m) Adjusted EBITA 842 885 Working capital movement (58) (28) Adjustment for high end production tax credits (9) 8 Share-based compensation and pension service cost 13 10 Acquisition of property, plant and equipment, and intangible assets* (71) (44) Adjustment to capex relating to redevelopment of London HQ 16 - Depreciation 30 31 Adjusted cash flow 763 862 Profit to cash ratio 91% 97%

Adjusted cash flow 763 862

Net cash interest paid (38) (20)

Adjusted Cash tax paid (118) (126)

Pension funding (80) (80)

Free cash flow 527 636

*Except where disclosed, management views the acquisition of operating property, plant and equipment and intangibles as business as usual capex, necessary to the ongoing investment in the business. 36 31 December 2017 (£m) 2016 (£m) £630m RCF (60) - £161m Jan 17 - (161) £100m bilateral loan - (100) €600m Eurobond (529) (508) €500m Eurobond* (424) (425) Finance Leases - (4) Other debt (25) - Cash and cash equivalents 126 561 Net debt (912) (637)

31 December 2017 (£m) 2016 (£m) Cash and cash equivalents 126 561 Debt (1,038) (1,198) Net debt (912) (637)

*Net of £20m cross currency swap (2016: £2m) 37 £m 150

(50) 527

(250)

(637)

(450) (912)

(650) (494)

(126) (850) (95) (36) (20) (16) (15)

(1,050) Dec-16 Net Free cash Dividends Exceptional Acquisitions Purchase of FX on London Other Dec-17 Net Debt flow items and shares for EBT retranslation property Debt investments of debt capex

38 Type of Facility Facility Amount Amount drawn at 31/12/2017 Maturity

Revolving credit facility (RCF) £630m £60m 2022, option to extend to 2023

Bilateral financing facility £300m £0m 2021

Total £930m £60m

39 £m 0 20 53 (83) 6 (328) 145 (100) (59) (39)

(200) 80

(300)

(400) Dec 16 Deficit funding Update in scheme Change in assets Change in inflation Change in bond yields Other Dec-2017 membership data assumptions Net pension deficit

40 Revenue by currency – 12 months to 31 December 2017 (£m) 2016 (£m)

GBP 2,313 2,357 US Dollar 435 397 Euro 274 224 Other Currencies 110 86 External revenue 3,132 3,064

Foreign Exchange Sensitivity – impact of a 10% appreciation/depreciation in Sterling* Currency Revenue (£m) Adjusted EBITA (£m) USD ($) ±50-60 ±6-8 EUR (€) ±40-50 ±4-5

*An appreciation in Sterling has a negative effect on revenue and adjusted EBITA, a depreciation has a positive effect

41