ProSiebenSat.1 Media SE Annual Report 2015 WorldReginfo - 1f357956-f403-47ad-b500-79d388ba3a73 PROSIEBENSAT.1 AT A GLANCE ProSiebenSat.1 Group is one of the most successful independent media companies in Europe with a strong lead in TV and the digital space. In 2015, the Group increased its revenues by 13.4 % to EUR 3.261 billion, while recurring EBITDA rose by 9.2 % to EUR 925.5 million. Advertising-financed free TV is the Group’s core business. The station family comprising SAT.1, ProSieben, kabel eins, sixx, SAT.1 Gold, and ProSieben MAXX is the number 1 in the German audience and TV advertising markets. The Group has tapped into an additional attractive business area through the distribution of its television channels in HD quality. At the same time, the Group successfully networks the wide reach of its TV business with a strong digital unit. In this way, ProSiebenSat.1 is opening up new markets and has created a strong base for long-term growth. The Group is already Germany’s leading video mar- keter on the Internet. With the video-on- demand portal maxdome, ProSiebenSat.1 is one of the most successful suppliers of d igital entertainment. Studio71 is the largest multi-channel network in Germany and is among the top 5 worldwide. In recent years, ProSiebenSat.1 has also built up a successful e-commerce portfolio that is now one of its most important growth drivers. Via its international production and distribution business Red Arrow Entertainment Group, the Company is present with 15 companies in six countries. By 2018, ProSiebenSat.1 intends to increase its revenues by EUR 1.85 billion up to around EUR 4.2 billion, compared to 2012. The ProSiebenSat.1 Group is headquartered in Unterföhring/Munich and employs approximately 4,900 people. The share was one of the largest MDAX stocks in 2015; in March 2016 it will be included in the leading equity index DAX as the first media stock. Revenues (I) Recurring EBITDA (II) EUR m EUR m 2015 3,260.7 2015 925.5 2014 2,875.6 2014 847.3 0 1,000 2,000 3,000 0 500 1,000 Group revenue share by segment (III) in percent, 2014 figures in parentheses Content Production & 7.0) Global Sales 8.0 ( Digital & Adjacent 26.0 (21.2) Broadcasting German-speaking 66.0 (71.7) A T A GLANCE All information relates to continuing operations. WorldReginfo - 1f357956-f403-47ad-b500-79d388ba3a73 FORECASTS 2015 ACTUAL FIGURES 2015 FORECASTS 2016/2017 Revenues Increase Significant increase (2016) Significant increase +13.4 % to EUR 3,260.7 million High single-digit increase (2017) (2014: EUR 2,875.6 million) Broadcasting German-speaking Increase Slight increase Slight increase +4.3 % to EUR 2,152.1 million (2014: EUR 2,062.7 million) Digital & Adjacent Increase Significant increase Significant increase +38.6 % to EUR 846.4 million (2014: EUR 610.7 million) Content Production & Increase Global Sales +29.7 % to EUR 262.2 million Significant increase Significant increase (2014: EUR 202.2 million) Recurring EBITDA Increase Mid to high single-digit increase Mid single-digit increase +9.2 % to EUR 925.5 million (2014: EUR 847.3 million) Broadcasting Increase Slight increase German-speaking +4.5 % to EUR 734.3 million Slight increase (2014: EUR 702.8 million) Digital & Adjacent Increase Significant increase Significant increase +31.6 % to EUR 170.2 million (2014: EUR 129.3 million) Content Production & Increase Significant increase Global Sales +30.8 % to EUR 25.0 million Mid to high single-digit increase (2014: EUR 19.1 million) Underlying net income Increase Mid to high single-digit increase High single-digit increase to EUR 467.5 million +11.6 % (2014: EUR 418.9 million) Leverage ratio 1 1.5 – 2.5 1.5 – 2.5 2.1 (2014: 1.8) German TV audience market 2 Growth by Consolidate leading market position At least maintain or slightly expand 29.5 % 0.8 percentage points at a high level leading market position (2014: 28.7 %) All information relates to continuing operations. Segment revenues relate to external 1 Adjusted for LTM recurring EBITDA from the Eastern European business. revenues. The forecasts reflect the percentage change vs. previous year. 2 14 Relevant target group of - to 49-year-olds. WorldReginfo - 1f357956-f403-47ad-b500-79d388ba3a73 KEY FIGURES OF PROSIEBENSAT.1 GROUP (IV) EUR m 2015 2014 Revenues 3,260.7 2,875.6 Revenue margin before income taxes (in %) 18.5 19.5 Total costs 2,555.4 2,209.0 Operating costs 1 2,354.5 2,046.9 Consumption of programming assets 895.5 867.8 Recurring EBITDA2 925.5 847.3 Recurring EBITDA margin (in %) 28.4 29.5 EBITDA 881.1 818.4 Non-recurring items3 – 44.4 –28.9 EBIT 729.9 694.5 Financial result -126.4 –134.4 Profit before income taxes 603.6 560.1 Consolidated net profit (after non-controlling interests) 4 390.9 346.3 Profit from discontinued operations (net of income taxes) 0.3 –27.1 Underlying net income 5 467.5 418.9 Basic earnings per share (underlying) 2.19 1.96 Investments in programming assets 943.9 889.7 Free cash flow –1.2 276.5 Cash flow from investing activities –1,521.7 –1,148.4 EUR m 12/31/2015 12/31/2014 Programming assets 1,252.4 1,211.9 Equity 943.1 753.9 Equity ratio (in %) 17.7 19.3 Cash and cash equivalents 734.4 470.6 Financial liabilities 2,674.8 1,973.1 Leverage 6 2.1 1.8 Net financial debt 1,940.4 1,502.5 Employees 7 4,880 4,210 1 Total costs excl. D&A and non-recurring expenses. 5 Consolidated profit for the period attributable to shareholders before the effects of 2 EBITDA before non-recurring (exceptional) items. purchase price allocations and additional special items. 3 Non-recurring expenses netted against non-recurring income. 6 Ratio net financial debt to recurring EBITDA in the last twelve months; adjusted for 4 Consolidated net profit attributable to shareholders of ProSiebenSat.1 Media SE including the LTM recurring EBITDA contribution of Eastern European operations. discontinued operations. 7 Full-time equivalent positions as of reporting date from continuing operations. Explanation of reporting principles in the financial year 2015 / at December 31, 2015: statement have been presented on a comparable basis. In the financial year 2011, the Belgian The figures for the 2015 financial year relate to those for continuing operations reported TV operations and the Dutch TV and print operations were deconsolidated on closing of in accordance with IFRS 5, i.e. not including the contributions to revenues and earnings of the respective share purchase agreements in June and July 2011 respectively. The income operations sold and deconsolidated in February 2014 (Hungary) and April/August 2014 statement items for the operations concerned are reported separately as the result from (Romania). The income statement items of the entities concerned are grouped as a single discontinued operations. The 2011 result from discontinued operations contains the net profit line item, result from discontinued operations, and reported separately. The result from as well as the gain on disposal and is presented after taxes. The figures for 2010 (income discontinued operations includes both the net profit generated by the companies sold in statement and the cash flow statement) have only been restated for the figures of the Hungary and Romania as well as the respective gain on disposal and is presented after taxes. operations sold in the financial year 2011. The figures for the financial years 2013 and 2012 for the income statement and the cash flow The previous year‘s figures in the statement of financial position were not adjusted. SELECTED KEY FIGURES A GLANCE AT WorldReginfo - 1f357956-f403-47ad-b500-79d388ba3a73 ProSiebenSat.1 Media SE GROWING TO THE NEXT LEVEL We pursue our success story with passion and a clear strategy. Our goal: dynamic growth and strong profitability. We view challenges as opportunities. We like to explore new paths. The industry around us is vibrant — and we generate the vibes to thrive in it. We had another record year in 2015. The key to our success is how we network our high-reach TV business with our digital assets to enhance value. We have also taken on big projects for the years to come. We plan to build our revenues to EUR 4.2 billion by 2018. We establish synergies for growth, make the most of new technologies, and invest specifically in attractive markets. We will continue to push ahead and remain a reliable partner for the capital markets in the future. Annual Report 2015 WorldReginfo - 1f357956-f403-47ad-b500-79d388ba3a73 04 Interview with Thomas Ebeling Members of the Executive Board HIGHLIGHTS 2015 TARGETS 2018 BROADCASTING GERMAN-SPEAKING 12 Small Channels, Big Successes Still on the success track 16 The Future of TV Advertising Record revenues DIGITAL & ADJACENT 60 20 The Boom in Multi-Channel Networks + 1.85 26 E-Commerce — A Growth Market percent 3 261 CONTENT PRODUCTION & GLOBAL SALES . We already achieved 60 percent of our revenue billion EUR 30 Red Arrow’s Expansion Strategy in the US billion EUR growth target for 2018 at the end of 2015. 43 Revenue gain vs. 2012 ProSiebenSat.1 is growing in all of its segments, and aims to increase consolidated revenues to around ProSiebenSat.1 sees yet another substantial percent EUR 4.2 billion in the medium term, with about 50 increase in consolidated revenues. 2,301 We already achieved 43 percent of our revenue percent of revenues coming from operations other 2 152 than TV advertising.