April 5th, 2005
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Road show in Holland –
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Introduction d
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TF1 Group’s channels H
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Advertising –
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Strategy and outlook e
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1 Good results in 2004
EBIT: + 19.4% Net profit: + 15%
€398.8 M €220.1 M 333.9 191.5 -
293.5 155.2 R
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2002 2003 2004 2002 2003 2004 a
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Operating margin: + 1.8 pt Net margin: + 0.8 pt p
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13.9% 2 0
7.7% 0
12.1% 6.9% 5
11.1%
5.8% -
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2002 2003 2004 2002 2003 2004
Programming costs under control: + 4.8% (€893.2 M)
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Introduction o
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TF1 Group’s channels n
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Advertising –
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Strategy and outlook e
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2 Audience share consolidation ….
Individuals aged 4 and + Women below 50 -
Others TV Others TV R
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9.7 d -
11.2 S
(-0.3pt) h
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12.5 n
18.6 H
(-0.1pt) 35.5 o l
31.8 (+0.1pt) l a
(+0.3pt) (+1.1pt) n
2.0 d
3.0 – A
1.4 p r
3.8 2.7 i
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3.6 11.3 17.1 0
15.2 20.5 0
(-0.9pt) (+0.1pt) 5
(-0.9pt)
= -
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Increase in TV consumption: Increase in TV consumption: h
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204 minutes per day 209 minutes per day + 2 min (TF1: + 2 min) + 10 min (TF1: + 4 min)
Source: Médiamétrie Jan-Dec 2004 vs Jan–Dec 2003 Canal+ France 5 ARTE 5
… at controlled cost: + 3.5%/year over 10 years
Evolution of programming costs -
1994 R
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0 100 200 300 400 500 600 700 800 900 €M r
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2005: +3.9% 2006: ~ +3% (excl. Football World Cup)
Detailed programming costs in appendices 6
3 TF1 Group: leading the theme channels market
*
TF1 Group = 24 theme channels Theme channels market -
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2004 figures: a
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Pay TV penetration: 23.5% w
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National audience share: 11.2% H
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TV ad market share: 9.0% n
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Theme Total TF1 Group m a channels share of voice n
channels share of voice
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31.7% +=2.9% 34.6% s
Source: Médiamétrie 2004 – MédiaCabSat 8 / Audience share / Individuals aged 4 and above / Whole base
* 11.4% stake 7
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4 Advertising in 2004 – Complementary channels
High ranking thematic channels
Audience Audience Subs Ad revenue *
Target share 31.12.04 growth -
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AB+ people d -
1.5 % 5.7 M + 41% S
Men 15-49 years old h
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+ 22% H
AB+ people 1.1 % 5.3 M + 22% o
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Women 15- 34 years 1.0 % 2.7 M + 14% A
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Women < 50 1.1 % 4.4 M + 72% 5
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Individuals 15-49 years 0.6 % 2.4 M + 15% a
+ 15% n
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AB+ people 0.2 % 2.1 M + 14% e
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AB+ people 0.1 % 4.2 M ns
* Source: Médiamétrie audience share / MédiaCabSat 8 / Audience share / Individuals aged 4 and above / Whole base 9
Outlook 2005
TV advertising growth
forecasts for 2005
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+3.0% according to France PUB B
+3.0% according to France PUB S
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+3.1% according to Ad Barometer e
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+4.5% according to Zénith Optimédia e
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guidance for 2005 ad revenue: +3% to +4%
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Introduction o
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TF1 Group’s channels
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Advertising n
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Contributions 2004* – 2005 format
% of Operat. Op. margin Revenue Op. margin
€M total rev. profit 2004 2003 -
TV Broadcasting 1,995.4 69.7% 354.9 17.8% 15.3% R
o a 82.62.9% 9.5 11.5% 6.0% d
Incl. Teleshopping - S
E-TF1 47.81.7% 2.5 5.2% ns h
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Distribution: TPS 380.1 13.3% 1.3 0.3% 0.8% n
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7.9% 7.0% 5.9% n
Audiovisual rights 226.4 15.8 d
153.85.4% 14.7 9.6% 7.3% –
Incl. TF1 Vidéo A
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International channels 239.2 8.3% 27.5 11.5% 10.9% 0
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Other activities 20.4 0.7% (0.7) ns ns L
Other activities 20.4 (0.7) e
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Total 2,861.5 100% 398.8 13.9% 12.1%
Total 2,861.5 398.8 B
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TV Broadcasting: TF1, TF1 Entreprises, Teleshopping, Eurosport France, LCI, Odyssée, TF6, TV Breizh, r s
Série Club,Histoire, e-TF1, Glem, Alma, TAP, TPP, Studios 107, TF1 Films Production
Distribution: TPS Audiovisual rights: TF1 Vidéo, CIC, RCV, Ciby DA, TF1 International, Téléma, TCM, Cabale International channels: Eurosport, Europa TV, KSO & SRW Other activities: Métro, Visiowave, Prima TV, Syalis * Contributions after intra-group restatements 12
6 2004 results in line with expectations
Number of paying subs 2004 key figures*
Million - Rev: €291.2 M (+ 2.4%)
54 R
+7.3% o
EBIT: €32.2 M (+ 6.6%) 52 a d
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+4.8% S h
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54 countries - 19 languages +3.9% w
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TV households: 98.0 M 44 H
42 o
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Paying subs: 51.5 M a
40 n
(+7.3% vs 2003) 2002 2003 2004 d
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Revenue (€M) EBIT (€M) EBIT margin (%) 0
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12% -
320 11.1% L e
294.3 35 32.2 11% 10.6% h
291.2 m 300 284.4 30.2 10% a 280 30 n
25.9 8.8% B 25 9% r
260 o
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240 20 8% e
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220 15 7%
200 10 6% 2002 2003 2004 2002 2003 2004 2002 2003 2004
* Contributions to consolidated revenue 13
Drivers for profitability
Revenue growth for Eurosport channel
Improvement of the pan-European advertising market share -
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Positive change for fees revenue d
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- Increase in paying households w
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- New distribution contracts H
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(Central, Eastern and Southern Europe …) a
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- Distribution on new platforms (DTT, ADSL …) –
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Additional revenue thanks to market & offer expansion 0
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Europe: Eurosport 2 L
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Outside Europe: Eurosportnews m
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Asia …
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Development of the offer at marginal cost e
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Optimise the Group’s know how Develop internal synergies for production 14
7 TPS: a growing business
Number of subscribers* An increasing monthly ARPU 1.7 M 1.5 M
1.4 M ADSL: 45 k 37.7 - 1.3 M 37.3 Cable: 320 k 37.1 37.1 R
1.1 M o
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Satellite: 1 310 k o
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2000 2001 2002 2003 2004 p
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A decreasing churn rate Turnover 0
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11.1% +7%
11.0% -
+7% L 10.6% e
+9% h m
10.0% 572 a
+19% n
537 B r
500 o
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457 e
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€M 385
2001 2002 2003 2004 2000 2001 2002 2003 2004
* Excl. Collective subscribers ** figures at 100% 15
TPS*: breakeven in 2004 for the satellite activity
2000 2001 2002 2003 2004 3 2 -4 Breakeven -
-9 R o
-23 a
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-37 EBITDA : 2000 S
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EBIT : 2003 w
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-83 l l Net profit a
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€M 250 n
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TPS : debt reduction o
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2002 2003 2004
* Figures at 100% 16
8
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Introduction o
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Conclusion
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¾ Remain leader for TF1 channel and theme o
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channels in France S
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¾ Keep on developing programme and service
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distribution p
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¾ Maintain Eurosport position as the first pan- m
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European channel B
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9 DTT launched in March 2005
14 channels for the free offer => March 2005
State-owned -
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Generalist -
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TF1 Group w
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Music a
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Sport -
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Mini generalist m a
TV Dramas n
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Youth h e
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15-35 years old Cinema
* 2 frequencies are still to be allocated 19
Outlook 2010
2004 Outlook 2010
Households equipped with TV 24 M households 25 M households -
Households receiving only R o
16.5 M households <12 M households a
5 analogue channels d
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Digital satellite 3.6 M households 4.5 M households w
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Cable (service antenne) 1.5 M households 1 M households H
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Cable (pay TV) 2.5 M households 2.5 M households n
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ADSL 5 M households 10 M households L
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Free TV on ADSL 150 K households 2.5 M households m
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Pay TV on ADSL 80 K households 1 M households B
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Mobile phone 43 M individuals 50 M individuals s
Video on mobile phone 0 > 25 M individuals Video on nomad screens 0 4 M screens 20
10
April 5th, 2005
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Notes –
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Contributions 2004* –2003 format
Revenue Op. profit Op. margin M€ 2004 2003
TF1 Channel 1,667.4 352.1 21.1% 19.1% -
R
o a Publishing/Distribution 280.5 35.1 d
12.5% 9.8% -
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Eurosport 291.2 32.2
11.1% 10.6% i
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H
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Theme Channels 56.1 (17.0) l
ns ns a
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TV Production1 39.4 (6.1) ns ns –
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Audiovisual Rights2 78.6 (0.6) 2
-0.8% -1.3% 0
0
5
Internet 47.8 2.5 5.2% -4.6% -
L
e h 380.1 1.3 0.3% 0.8% m
TPS a
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B r Others 20.4 (0.7) o
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Total 2,861.5 398.8 13.9% 12.1%
* Contributions after intra-group restatements 1 Groupe Glem, Alma, TAP, Quai Sud, Studios 107, TF1 Publicité Production 2 TF1 Films Production, Téléma, TF1 International, Ciby DA, TCM 22
11 Shareholding structure – 31st December 2004
Voting Capital rights
BOUYGUES 41.5% 41.5% -
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Société Générale 1.4% 1.5% S
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Core shareholders 42.9% 43.0% H
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(1) 35.4% 35.4% d
Others France –
Incl. employees 3.3% 3.3% A
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Treasury shares 0.1% - 0
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Europe (excl. France) 16.6% 16.6% e
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Others (excl. Europe) 5.0% 5.0% B
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Total 100% 100% s
(1) Including unidentified shareholders Source: Euroclear as of 31 December 2004 23
Programming costs*
2004 2003 ∆ / 03
€M -
€M
R
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Entertainment 275.9 261.1 + 14.8 d
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TV drama & series 217.1 211.3 + 5.8 i
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H
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Sport 146.7 140.7 + 6.0 n
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News 116.0 113.8 + 2.2 r
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102.5 5
Movies 113.2 102.5 + 10.7
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Children programmes 24.3 22.6 + 1.7 m
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Total programming costs 893.2 +41.2 r
852.0 o
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2004 change: + 4.8%
* incl. Retired and expired rights 24
12 TF1, leader in a growing market
Increasing audiences in a more competitive environment
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Individuals aged 4 and + Women below 50 o
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2002 2003 2004 2002 2003 2004 h
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204' 209' H
202' 199' o
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+4’ 0
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+2’
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63 a
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39 B 42 42 36 r 3332 35 37 o 2626 24 t
2223 23 20 20 h
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Others Others TTV TV TTV TV
25
Advertising : sectorial breakdown
Variation January to February 2005 vs Jan-Feb 04
FOOD €129 M -7.2% -
R
o a COSMETICS d
€60 M +4.9% -
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PUBLISHING i
€40 M -0.9% n
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AUTOMOTIVE €39 M + 13.4% n
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+32.3% r
SERVICES €28 M i
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- 18.9% 5
HOUSE CLEANING €26 M
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+36.1% m
TELECOMMUNICATION €25 M
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NEWS - MEDIA €16 M - 13.2% o
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CULTURE & LEISURE €10 M -2.1%%
Source : TNS Secodip – 2005 vs 2004 – January to February 26
13 The best resistance
Audience share - Analogue* Cable & satellite**
Degree R o
(100% penetration) (23% penetration) a
of resistance d
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TF1 31.8 % 24.5 % 77% o
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20.5 % 14.4 % 70%
France 2 H
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France 3 15.2 % 9.0 % 59% n
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3.0 % 1.4 % 47% A
France 5 p
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12.5 % 8.4 % 67% 2
M6 0
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: The best resistance to the m a market fragmentation n
market fragmentation
B
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The market fragmentation widens the gap r
The market fragmentation widens the gap s
between TF1 and its competitors
* Source Mediamétrie : 2004, ind. 4+ ** Source Mediacabsat 8 : September 2004 – February 2005 27
Advertising in 2004
Growth in 2004
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R o
TF1 core channel +6.6% a
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Thematic channels +25.5% i
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Internet +44.7% d
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TF1 advertising market share: 54.8% (+0.1 pt)
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(1) a
980 ad screens out of the top 1,000 broadcast on TF1 n
B
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(2) e
Advertising watched per day on TF1 – Women < 50: +8.5% r
s
(1) On women below 50 (2) Source: Médiamétrie – 2004 vs 2003 28
14 TPS: a rich and diversified offer !
• Best of cinema on TPS !
Warner, Touchstone, -
55 % of market share R o
New regency, a
on US studio movies d -
MGM, S h
Paramount, o
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i
Dreamworks, n
H
Columbia, … o
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French Cinema : €35 M invested / year n
d
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A
p r
• Sports exclusivity i
l
2 0
English Premier League 0
5
Basket ball: French championship and national team -
L
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h
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• A premium offer and more than 100 channels starting n
B r
at 28.5€/month o
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h
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New in 2005 : Ushuaïa TV, M6 Music Rock, M6 Music Black … On exclusivity : TF6, Boomerang, Teletoon, Piwi, Eureka, Tfou, Infosport, Fun TV, M6 Music 29
: a promising start
An original format and an innovating programming line up
• The first sport channel broadcast on free to air in Europe -
R
o
a d
• A complementary free offer to the sport pay offer: - S
Sky, Eurosport and free to air generalist channels h
o
w
i
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H
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A fast growing coverage of the channel a
n
d
launched on February 6th, 2004 –
A
p
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• 442 frequences = 81% of the Italian population l
2
0
0 5
• 27.1 M out of 46.2 M inhabitants already selected
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Sportitalia on their TV L
e
h
m
a
n
B
r
o
t h
First audience success e
r
s
• A weekly reach of 9.4 M viewers in December 2004
30
15 : DTT
An optimal coverage
68% national coverage -
~ 15 M households (i.e. more than 39 M
R o
Italian people) a
d
-
S
h o
A full digitalisation of the network in less w
i
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than 1 year H
o
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a
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A good programming offer :
– A
CANALE 5, ITALIA 1, SPORTITALIA, RADIOITALIA & LCI p
r
i
l
2
0 0
A strong & fast growth of the nb of decoder sold 5
-
L e
1750 000 h x 3 in 5 months m
1500 000 a n
~ 1.6 M decoders 1250 000
B r
1000 000 o t
750 000 h
e r
500 000 s
250 000 0
4 4 0 04 0 04 04 -04 r-04 n- il- -04 v- ai i nv-05 v u ju a m j sept- oct no ja mars- Figures at January 2005 31
Other major subsidiaries
Revenue €83.2 M (+14% vs 2003)
EBIT €9.5 M (> x2 vs 2003) -
R o
Growth and a d
EBIT Margin 11.4% (+ 5.4 pts vs 2003) -
profitability S
h
o
w
i
n
H
o
l
l a
Revenue €235.7 M (+ 9.5% vs 2003) n
d
– A
EBIT Margin 10.5% (+ 2.5 pts vs 2003) p
r
i
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2004 2 0
Units sold 19.7 M (+ 30% vs 2003) 0
a record year 5
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m
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A diversified o
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line up with e
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exceptional 2005: a promising movies year for cinema
32
16
Continue the relationship with our TV viewers -
• Services for all, via the 3 mobile operators
R
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•A mass market offer: entertainment, S
h o
news, sports, games w
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H
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• TF1 has edited video mobile content l
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since April 2004 (Euro 2004, mobile news, d
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LCI…). A
p
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2 0
•Strong reactivity to events thanks to the 0
5
integration of know-how (marketing, -
L e
technical, programming line up) h
m
a
n
B
•To anticipate tomorrow’s services: r
o t
Agreement with Nippon TV, mobile TV h
e
r s
broadcast (2004 world car exhibition).
33
France : a highly regulated market
TF1 : legal environment
Duration : daily average: 6 ’ / hour -
max: 12 ’ / hour R
o
a
d - Sectors non authorized to advertise on TV: S
ADVERTISING h o
• Retail • Cinema w
i
n
H
Interruption of programmes : 1 ad break max /movie o
l
l
a
n
d
– A
Investment obligations in French and EU programmes p
r
i
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(16% of ad. revenue in TV drama, 3.2% in Movies …..) 2
0
0
5
PROGRAMMING
Broadcast : max. 192 movies / year -
L e
min. 1,000 hours of children’s programmesh
m a
min. 800 hours of news programmes n
B
r
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SHAREHOLDING 49% ownership law
34
17
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35
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R
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a
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h
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w
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H
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–
A
p
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2
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0
5
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B
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36
18
April 5th, 2005
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R
o
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S
h
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w
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H
o
l
l
a
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d
Road show in Holland –
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p
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2
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5
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B
r
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37
19