Strong Performance in a Challenging Year Gerhard Zeiler on RTL Group’S Results 2008

12 March 2009 week 11 Strong performance in a challenging year Gerhard Zeiler on RTL Group’s results 2008 Germany France Peter Kloeppel on the Groupe M6 publishes its “mega election year” results for the year 2008 The Netherlands Belgium Zeg’ns AAA: RTL Digital is innovating a comeback after 16 years week 11 COVER: Gerhard Zeiler, CEO of RTL Group. Strong performance n a challenging year 2 week 11 the RTL Group intranet “RTL Group is a healthy company – profitable, debt-free, with strong cash flows” RTL Group increased revenue and EBITA, for the seventh consecutive year. Backstage spoke to Gerhard Zeiler, CEO of RTL Group, about the company’s performance in 2008 and the outlook for 2009. Gerhard Zeiler, CEO of RTL Group Luxembourg - 12 March 2009 On 12 March, RTL Group announced its ratings in 2008 were markedly influenced by audited results for the fiscal year 2008. The the European football championship and the Group’s operating result (EBITA – Earnings Olympic Summer Games in Beijing, as both Before Interest, Taxes and Amortisation) excee- events were televised by the public broadcas- ded EUR 900 million for the first time and ters ARD and ZDF, Mediengruppe RTL increased by 2 per cent to EUR 916 million – Deutschland remained the clear market leader despite a tougher economic climate. Group in the key 14 to 49 target group. The flagship revenue increased by 1.2 per cent to EUR channel RTL Television continued to be the 5,774 million (2007: EUR 5,707 million). number one among young viewers, by a large Adjusted for portfolio changes and at constant margin and for the 16th consecutive year. exchange rates, underlying revenue was up 2.6 per cent. In particular, strong performances at Mediengruppe RTL Deutschland and FremantleMedia contributed to the increase in profits. The reported EBITA margin improved to 15.9 per cent (2007: 15.7 per cent), the highest ever. Net profit attributable to RTL Group shareholders decreased to EUR 194 million (2007: EUR 563 million), mainly due to an impairment of goodwill of the UK TV activities amounting to EUR 337 million. This impairment is primarily a result of the significant worsening in the UK advertising market conditions, which the company has experienced since September 2008. In Germany, RTL Group’s profit centre had its best year ever. EBITA rose 25.6 per cent and Mediengruppe RTL Deutschland significantly strengthened its leading position in the German TV advertising market. Although audience Elmar Heggen, CFO of RTL Group 3 week 11 the RTL Group intranet RTL Group’s worldwide production arm Backstage spoke to RTL Group’s CEO Gerhard FremantleMedia reported growing revenue and Zeiler about the company’s performance in EBITA figures for the fifth consecutive year. 2008, its strategy and its outlook for 2009. EBITA increased significantly by 18.3 per cent, mainly driven by higher earnings from Many media companies and broadcasters FremantleMedia North America. reported lower revenue and operating results during the last weeks. How is the In France, Groupe M6 reported stable revenue state of RTL Group? despite a significant slowdown of the country’s In spite of increasingly difficult advertising TV advertising market, while the company’s markets in Europe, in 2008 RTL Group increa- EBITA was impacted by a major programme sed its revenue and operating result for the investment for the 2008 European football seventh year running. In particular, strong per- championship. M6 was the only major terres- formances at Mediengruppe RTL Deutschland trial channel with stable audience figures in and FremantleMedia contributed to the increa- prime time, benefiting from the record audien- se in profits. ces watching the Euro 2008 broadcasts. In the digital arena, the group’s free DTT channel W9 RTL Group is a healthy company – profitable, continued its rapid audience and revenue debt-free, with strong cash flows. We have a growth and generated positive EBITA for the broad-based setup, and we’re active in many first time. As a result, the family of channels countries and business areas. This is the result strategy has paid off for Groupe M6: despite of the hard work of our creative and passiona- accelerated audience fragmentation, the com- te employees and of our excellent management bined total audience share of M6 and W9 team which knows the needs of our business. actually increased year on year. In view of an increasingly difficult economy, one RTL Nederland implemented a restructuring thing still holds true: television is and will programme at the end of 2008. One-time remain the leading medium. Television delivers charges in connection with this restructuring, great value, for our viewers and for our adverti- amounting to EUR 18 million, impacted sers. While the structure of RTL Group’s RTL Nederland’s EBITA, which was down 17.6 business model remains intact, there is a need per cent in total. to continuously optimise our operations, increasing efficiencies and reviewing costs across the board. Gerhard Zeiler and Elmar Heggen during an Operations Management Committee meeting 4 week 11 the RTL Group intranet And what does this mean for RTL Group’s What about geographic expansion – is this shareholders? still on the agenda? Our first priority remains to create value for all In 2008, the leading European entertainment our shareholders. network again grew larger: RTL Group entered the Greek market by acquiring a 66.6 per cent Based on the 2008 results and the cash majority shareholding in Alpha Media Group. position, we propose a total dividend of EUR With currently 45 TV channels in 11 European 3.50 per share – consisting of an ordinary divi- countries, RTL Group has a very well-balanced dend of EUR 1.40 and an extraordinary divi- portfolio as a TV broadcasting company. dend of EUR 2.10. I am very proud that we are able to pay our shareholders a significant divi- Of course, we’ll continue looking at opportuni- dend of more than EUR 500 million – and still, ties, in various countries – this is our everyday we’re not only debt-free, but we’ll also continue business. However, at times like this, the to have a significant positive net cash position. investment criteria are stricter and we are staying cautious. If there should be interesting If this proposal is accepted at the Annual investment opportunities – at decent prices General Meeting next month, it would mean and which fit to our strategy – we are well posi- that we have returned EUR 1.8 billion over the tioned to go for them. last three years to our shareholders. Turning to the current economic situation – What were the major strategic achieve- what is RTL Group’s outlook for 2009? ments in 2008, especially with regard to the We are, without any doubt, operating in a very accelerated digitalisation of the media challenging time and are experiencing a business? substantial slowdown in advertising bookings. First of all: our position of strength is the result We will respond to this by focusing on our core of our strategy, which is based on strict invest- business, and by reviewing all costs and ment criteria. structures. This will result in a significantly lower cost base in all of our operations. The digital world offers RTL Group, as both a content company and a brand company, many Given the current state of the advertising mar- opportunities for new business models. The kets, and the very short-term bookings cycle, it Group has defined clear priorities for the digital is impossible to give reliable full-year world: the first is to develop our strong families guidance. But it has to be expected that the of TV channels into multi-platform families. We profitability level will be down compared to call this ‘moving with our audiences’. The 2008. second is to make further online investments in all areas with high growth potential that com- Nevertheless, due to the strength of our various plement the company’s core business. businesses, our balance sheet and the diversi- ty of our portfolio, we are confident that we will In 2008, we significantly stepped up our online overcome the challenges facing us. activities with targeted acquisitions and investments. RTL Group has built up comprehensive catch-up TV services in its major markets Germany, France, the Netherlands and the UK. In total, our online platforms across Europe registered more than 500 million video streams in 2008, which delivered professionally produ- ced content – from highlight clips to complete Find all related episodes of shows and series – to our viewers. documents on RTLGroup.com 5 week 11 the RTL Group intranet Peter Kloeppel on the “mega election year” Germany has numerous elections coming up this year. In the latest issue of Journalist magazine, Peter Kloeppel discusses how RTL Television plans to position itself in the political coverage. Germany - 6 March 2009 In the “mega election year” of 2009, Germans will be asked to cast their ballots more than once: not only are the European elections coming up, Germany also has local elections, regional elections (for the state parliaments) Peter Kloeppel, Editor-in-chief of RTL Television and federal elections in September. Peter Kloeppel, Editor-in-chief of RTL Television, declares: “We want to make the elections more of a topic in all our programmes – but not just by asking: what’s happening today? The idea is to clarify the issues that are preoccupying peo- ple, and to answer as many of the viewers’ questions as possible, especially the ones about the long-term implications of current events.” For instance, starting in August there will be six weeks during which coverage will focus on a specific topic each week, such as the economy, crime, education and integration.

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