Q1 2015 INTERIM REPORT JANUARy – MARCH 2015 HIGHLIGHTS With the acquisition of kids content producer and publisher YoBoHo, BroadbandTV became one of the leaders in kids and family entertainment on Youtube. YoBoHo owns and operates Hoopla Kidz, one of the largest Youtube kids and family networks, as well as 27 owned and operated channels in the vertical. YoBoHo maintains a proprietary library of content, comprised of over 8,000 videos in PROGRAMMATIC TV the kids vertical, mainly produced by the company. It generates RTL Group led the most recent financing round a total of three billion views for Clypd, a US-based platform for programmatic per year. Under this deal, advertising sales on linear TV, and now holds a the 55 YoBoHo employees will join 17.4 per cent minority stake in the company (on BroadbandTV, including: producers, a fully diluted basis). The Clypd platform, founded writers, marketers, technology in 2012, is comprised of innovative components and mobile experts, and a that automate workflows between buyers and strong business development team. sellers of TV airtime. It gives TV advertising sales RTL Group provided funding houses in the United States the ability to allow for BroadbandTV’s acquisition media planners to discover TV inventory of YoBoHo. opportunities in a unique data driven and efficient manner. Clypd is a pioneer on the programmatic TV front, focusing solely on offering linear TV inventory sales. Clypd operates the market- places on behalf of the broadcasters. Key clients KIDS include, Discovery Communications, Univision and Cox. Following the acquisition of a 65 per RULE cent stake in SpotXchange in summer 2014, the investment in Clypd underlines RTL Group’s strategy to become a leading player in all video segments. It complements RTL Group’s growing presence in online video, linking monetisation capabilities in linear and non-linear TV with data and technology-based businesses. With characters like Elly, Captain Discovery and Dragon Debbie, YoBoHo offers some of the most popular children’s channels on Youtube 2 INTERIM REPORT JANUARY – MARCH 2015 Contents 2 Highlights 6 Joint statement from the Co-CEOs 8 Interim management report 11 Mediengruppe RTL Deutschland 13 Groupe M6 14 FremantleMedia 16 RTL Nederland 18 RTL Belgium 19 RTL Radio (France) 20 Other segments 22 Condensed consolidated interim financial information 22 Condensed consolidated interim income statement 23 Condensed consolidated interim statement of comprehensive income 24 Condensed consolidated interim statement of financial position 25 Condensed consolidated interim statement of changes in equity 26 Condensed consolidated interim cash flow statement 27 Notes to the condensed consolidated interim financial information 41 Financial calendar 3 INTERIM REPORT JANUARY – MARCH 2015 RTL GROUP REPORTS A SUCCESSFUL START INTO 2015: EBITA SLIGHTLY UP, NET PROFIT SIGNIFICANTLY HIGHER Mediengruppe RTL Deutschland with significant revenue and EBITA growth Very strong revenue growth in digital: up 66 per cent Healthy financial position allows for further investments Luxembourg, 7 May 2015 − RTL Group, the leading European entertainment network, announces its quarterly results to 31 March 2015. HIGHLIGHTS Q1 / 2014 Q1 / 2015 restated 1 Per cent € m € m change Revenue 1,308 1,313 (0.4) Underlying revenue2 1,236 1,252 (1.3) Reported EBITA3 194 191 +1.6 Reported EBITA margin (%) 14.8 14.5 +0.3 Reported EBITDA4 247 246 +0.4 Reported EBITDA margin (%) 18.9 18.7 +0.2 Reported EBITA 194 191 Impairment of disposal group (14) – Impairment of investments accounted for using the equity method and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries (2) (2) Gain / (Loss) from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree – (1) EBIT 178 188 Net financial income / (expense) (4) (11) Income tax expense (53) (69) Profit for the period 121 108 Attributable to: – Non-controlling interests 15 17 – RTL Group shareholders 106 91 +16.5 Reported EPS (in € ) 0.69 0.59 +16.9 1 All financial data for Q1/2014 restated for impact of IFRIC 21 2 Adjusted for minor scope changes and at constant exchange rates 3 EBITA represents earnings before interest and taxes excluding impairment of goodwill and of disposal group, and amortisation and impairment of fair value adjustments on acquisitions of subsidiaries, impairment of investments accounted for using the equity method, re-measurement of earn-out arrangements, and gain or loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree 4 EBITDA represents EBIT excluding amortisation and impairment of non-current programme and other rights, of goodwill and disposal group, of other intangible assets, depreciation and impairment of property, plant and equipment, impairment of investments accounted for using the equity method, re-measurement of earn-out arrangements, and gain or loss from sale of subsidiaries, other investments and re-measurement to fair value of pre-existing interest in acquiree 4 INTERIM REPORT JANUARY – MARCH 2015 Q1/2015: EBITA, EBITA margin and net profit up year-on-year ■ Advertising market conditions in the first quarter ■ RTL Group’s digital revenue5 continued to show showed a mixed picture: looking across the very dynamic growth, up 66 per cent to € 88 million Group’s markets, RTL Group estimates that the net (Q1/2014: € 53 million), benefitting from organic TV advertising markets in Germany, France, Croa- growth and new acquisitions tia and Spain were up, while the market develop- ments in the Netherlands, Belgium and Hungary ■ Net profit attributable to RTL Group shareholders remained challenging amounted to € 106 million (Q1/2014: € 91 million), a 16.5 per cent increase year-on-year ■ Reported Group revenue was stable at € 1,308 mil- lion (Q1/2014: € 1,313 million). Lower revenue at ■ Net cash from operating activities was € 208 mil- Groupe M6 and FremantleMedia was offset by lion, resulting in an operating cash conversion of significantly higher revenue from Mediengruppe 110 per cent (Q1/2014: 114 per cent) RTL Deutschland ■ As of 31 March 2015, RTL Group had a net debt ■ Reported EBITA was slightly up to € 194 million position of € 452 million (31 December 2014: debt compared to € 191 million in Q1/2014. Accordingly, of € 599 million) the EBITA margin increased to 14.8 per cent 5 Excluding e-commerce, home shopping and platform revenue for digital TV (Q1/2014: 14.5 per cent) Segments: Mediengruppe RTL Deutschland achieves new record EBITA ■ Mediengruppe RTL Deutschland’s EBITA reached ■ RTL Nederland’s EBITA was down to minus € 3 mil- a new record high for a first quarter at € 153 million, lion from (Q1/2014: profit of € 6 million), mainly due up from € 134 million in Q1/2014, driven by signifi- a weak TV advertising market, lower margins of the cantly higher TV advertising revenue diversification business and higher programming costs ■ At Groupe M6, EBITA was slightly up to € 41 million (Q1/2014: € 40 million), reflecting higher EBITA con- ■ FremantleMedia’s EBITA decreased to € 3 million tributions from 6ter, M6 and Paris Première which (Q1/2014: € 9 million), mainly due to lower revenue were partly offset by lower contributions from diver- caused by phasing effects on the delivery of pro- sification activities grammes at FremantleMedia North America and in Europe 5 INTERIM REPORT JANUARY – MARCH 2015 “Overall, a successful start into the year” Joint statement from Anke Schäferkordt and Guillaume de Posch, Co-Chief Executive Officers of RTL Group: “Overall, we had a successful start into Additionally, ­­FremantleMedia invested in the the year and slightly increased our oper- newly launched Corona TV to strengthen its ating profit EBITA, mainly driven by another scripted pipeline with projects that will have strong performance from Mediengruppe cinematic feel. BroadbandTV used funding RTL Deutschland. provided by RTL Group to acquire the lead- ing kids content producer and publisher on During the first months of the year we have Youtube, YoBoHo. been further reinforcing our three strategic pillars: broadcast, content and digital. With We still have the capacity to explore more Oxygem in France, we boost the digital investment opportunities in the rest of the development of Groupe M6. As digital video year based on our very healthy financial monetisation becomes more automated, position. We will continue to do so through- we have extended our presence in April out 2015, applying our strict investment with a minority investment in the start-up criteria to generate profitable growth. Clypd in the US. Clypd complements the rapidly growing business of SpotXchange We confirm our outlook for the full year by adding cutting-edge sales capabilities to 2015 and expect our total revenue and 6 6 Excluding one-offs place spots into linear TV programmatically. EBITA to be broadly stable .” 6 INTERIM REPORT JANUARY – MARCH 2015 RTL Group continues to invest in its strategic pillars Broadcast Digital ■ In March, RTL Hrvatska launched three new basic ■ RTL Group has a strong and rapidly growing pres- pay-TV channels: RTL Passion, RTL Crime and ence across all digital platforms. In the first quarter RTL Living. The company now operates three free- of 2015: to-air and three pay-TV channels, more than any ■ RTL Group’s catch-up TV services, websites and competitor in the Croatian market MCNs attracted a total 18.7 billion online video views, up 160 per cent year-on-year7