Unlocking our potential 2019 Annual Report WorldReginfo - b13a8d21-eba9-45b6-ac53-12e6a2ace600 Contents 02 This is Televisa 04 Letter to Shareholders 08 Financial highlights 10 Cable 12 Sky 14 Content 16 Other businesses 18 Univision 20 Commitment to sustainability 22 Fundación Televisa 24 Management’s discussion and analysis of financial condition and results of operation 34 Board of Directors 36 Financial statements WorldReginfo - b13a8d21-eba9-45b6-ac53-12e6a2ace600 Televisa is a leading media company in the Spanish-speaking world, an import- ant cable operator in Mexico and an op- erator of a leading direct-to-home satel- lite pay television system in Mexico. Televisa distributes the content it produces through sev- eral broadcast channels in Mexico and in over 70 coun- tries through 25 pay-TV brands, television networks, ca- ble operators and over-the-top or “OTT” services. In the United States, Televisa’s audiovisual content is distributed through Univision Communications Inc. (“Univision”) the leading media company serving the Hispanic market. Univision broadcasts Televisa’s audio- visual content through multiple platforms in exchange for a royalty payment. In addition, Televisa has equity and warrants which upon their exercise would repre- sent approximately 36% on a fully-diluted, as-convert- ed basis of the equity capital in Univision Holdings, Inc., the controlling company of Univision. Televisa’s cable business offers integrated services, including video, high-speed data and voice services to residential and commercial customers as well as managed services to domestic and international car- riers. Televisa owns a majority interest in Sky, a lead- ing direct-to-home satellite pay television system and broadband provider in Mexico, operating also in the Dominican Republic and Central America. Televisa also has interests in magazine publishing and distribution, professional sports and live entertainment, feature film production and distribution, and gaming. WorldReginfo - b13a8d21-eba9-45b6-ac53-12e6a2ace600 This is Televisa Cable Sky Content Televisa is one of the most important A leading direct-to-home In 2019, Televisa produced more participants in Mexico’s telecom industry satellite television system and than 88,000 hours of content for broadband provider free to air and pay TV DIVISIONS Operates in Mexico, Central ADVERTISING Multiple System Operators America and the Dominican Televisa operates four broadcast (“MSOs”) division which offers video, high- Republic. channels—2, 4, 5, and 9— in Mexico speed data, and voice services to residential City and complements its geograph- and commercial customers, including small and ic coverage through affiliated sta- medium sized businesses. 58.7% interest owned tions throughout the country. Televi- by Televisa. Enterprise sa also sells advertising on its pay TV Provides telecommunications services, includ- networks and online properties. ing voice, data, managed services, as well as integration and cloud services to domestic Sky offers pay TV packages, in- NETWORK SUBSCRIPTION and international carriers and to enterprise, cluding exclusive content that Televisa produces and distributes corporate, and government customers in ranges from sports to concerts 25 pay TV brands. In 2019, Televisa Mexico and the United States. and special events, as well produced more than 18,000 hours as fixed-wireless broadband of content for pay TV networks. services with speeds ranging Revenue Generating Units from 5 to 10 Mbps. LICENSING & SYNDICATION Video 4,318,863 Televisa exports its programs and Broadband 4,696,054 formats to television networks Voice 3,637,992 Revenue Generating Units around the world. In the United States, Televisa distributes its con- Total RGUs 12,652,909 Video 7,429,351 tent through Univision under a Pro- Broadband 386,114 gram License Agreement (“PLA”). Voice 1,145 This year, the PLA resulted in royal- Total RGUs 7,816,610 ties to Televisa of U.S.$389.1 million. Other businesses GAMING RADIO * PUBLISHING Casino sites and online lottery Network of owned radio stations, The leading Spanish-language business. complemented by affiliated radio magazine publisher. stations owned by third parties. FEATURE FILM DISTRIBUTION SOCCER Distributes movies in Mexico and PUBLISHING DISTRIBUTION A first division soccer team of the Latin America. Distributes publications in Mexico Mexican league and owner of Azteca and Latin America. stadium, located in Mexico City. * Through the third quarter of 2019, the Radio business was classified as part of the Other Businesses segment, and beginning in the fourth quarter of 2019, it was classified as held-for-sale operations in the business segment information. WorldReginfo - b13a8d21-eba9-45b6-ac53-12e6a2ace600 2 Sales & OSI contribution 7.7% Other Businesses 3.6% OSI* 33.0% 30.8% 43.4% 39.2% Content OSI* OSI* Cable 22.2% OSI* 20.1% Sky Unconsolidated businesses Univision Ocesa Entretenimiento Televisa holds a direct equity interest of approximately 10% in Univision, Ocesa Entretenimiento, S.A. de C.V. (Ocesa) organized 3,490 events in the leading Spanish-language media company in the United States and Mexico and Colombia in 2019. the number five network regardless of language. Upon exercise of the Televisa announced that Live Nation Entertainment, Inc. agreed to pur- warrants, Televisa would hold approximately 36% of the equity capital of chase its uncon solidated 40% equity participation on July 24, 2019. Univision on a fully-diluted, as-converted basis. * Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation, and amortization, and other expense, net. For a reconciliation of total operating segment income with consolidated operating income, see Note 26 to our year-end consolidated financial statements. WorldReginfo - b13a8d21-eba9-45b6-ac53-12e6a2ace600 3 January 2020 Dear fellow shareholders From its early beginnings, Televisa pur- sued a mission of providing the most attractive and engaging content to its customers and audiences on as many platforms as possible. Over a decade ago, we expanded this vision to become one of the industry’s leading telecommunica- tions operators, extending access to pay television and high-speed data through- out Mexico. Today, we produce some of the best Spanish-language content in the world and transmit it across the most rel- evant platforms. In addition, by creating an extensive Bernardo Gómez telecommunications infrastructure in Mexico, we have Co-Chief Executive Officer become the country’s second largest provider of broad- band services reaching over 15 million households. In a fully convergent media and telecommunications industry, Televisa is positioned like no other company in the region. Our leading role in the creation and transmission of con- tent, combined with our growing presence in telecom- munications, has strengthened our ability to navigate dramatic changes in the media and telecommunications industries as well as in a volatile and sometimes unpre- dictable macroeconomic environment. In 2019 we were presented with an additional set of chal- lenges, namely, the significant drop in government adver- tising and a difficult year-over-year comparison due to the World Cup the previous year. In 2018, the Company benefited from the licensing of certain rights of the World Cup in Latin America, as well as from non-recurring ad- vertising revenue from our transmission of the World Cup matches in Mexico. Alfonso de Angoitia Co-Chief Executive Officer WorldReginfo - b13a8d21-eba9-45b6-ac53-12e6a2ace600 4 We prepared for these events by maintaining a strong disci- pline in cost and expenses and remained focused on the exe- cution of our strategy around our three core operations: Ca- ble, Sky and Content. As a result, excluding the non-recurring licensing of rights, during 2019 Consolidated Revenue grew 3.3%, Operating Segment Income grew 5.4%, and our Oper- ating Segment Income margin increased by 60 basis points. CABLE REACHED 12.7 MILLION REVENUE GENERATING UNITS In Cable, we achieved double digit growth in Revenue and Op- erating Segment Income. Our margin remained very strong, and we continued to expand the number of Revenue Gener- ating Units, or RGUs. By year end, our combined video, voice and broadband RGUs reached 12.7 million. Over a period of just five years, we have doubled the number of RGUs. Throughout the year we continued to push for the sale of bundled third party OTT services, which continued to grow at a good pace and drove the adoption of faster speeds. CAPITAL INTENSITY IN CABLE IS COMING DOWN Some years ago we identified a great opportunity to launch an ambitious investment program and expand and upgrade our network. This multi-year program allowed us to build a world-class network across more than 140 thousand kilome- Some years ago we identified a ters reaching over 40% of households in Mexico, the large great opportunity to launch an majority capable of receiving at least 100 megabits of speed. ambitious investment program We will continue to aggressively support and invest in our and expand and upgrade growth, maintain our network, and expand the number of households that we reach, but the heaviest phase of capital our network. This multi-year investments in our Cable business is now behind us. Capital program allowed us to build a expenditures in our Cable operation are expected to come world-class network across more down in 2020. than 140 thousand kilometers reaching over 40% of households in Mexico, the large majority