TVN : Reports Advertising Revenue Growth and Stabilized Adjusted EBITDA in a Moderately Softer Advertising Market Environment

Microsoft Word - 150804_press_release_en_final PRESS RELEASE TVN S.A.

166 Wiertnicza Str.

02-952 Warsaw, Poland

Tel. +48 22 856 60 60

Fax. +48 22 856 66 66 www.tvn.plwww.prasa.tvn.pl www.investor.tvn.pl

TVN REPORTS ADVERTISING REVENUE GROWTH AND STABILIZED ADJUSTED EBITDA IN A MODERATELY SOFTER ADVERTISING MARKET ENVIRONMENT

Warsaw - August 4th, 2014
• TVN revenues in the first half of the year increased to PLN 808 million after a 2.7% growth in the second quarter, reflecting primarily strong audience share performance of TVN thematic channels portfolio which drove advertising related revenues up by 3.6%.

• Adjusted EBITDA1 in the six-month period reached PLN 265 million and was 0.9% higher year-on-year, following the impact of revenue growth in the second quarter more than offset by investments in the spring programming schedule.

o Reported EBITDA in the second quarter and first half reflected predominantly impact of one-off costs related to change of control transaction which, despite significant improvement in share of profits of associates, drove reported results down by 10% and

20%, respectively.

• TVN channels portfolio all day audience share in the commercial target group improved year-on-year to 22.1% in the second quarter, with strong performance of thematic channels exceeding softer audience reception of the main channel's schedule.
• nC+ - the strategic associate of TVN - reported 2.1 million post-paid subscribers at the end of June, with a monthly ARPU of PLN 68.0 and revenues of PLN 1,041 million in the first six months of the year. EBITDA for the period arrived at PLN 210 million with the TVN share of nC+ profit amounting to PLN 29 million.
• Net result decreased to PLN 37 million in the second quarter due to year-on-year shift in foreign exchange impact from gains to losses, whilst half-year result slipped 8% to PLN

116 million reflecting one-off costs of change of control transaction exceeding improvement in net finance result.

• Net debt to adjusted EBITDA improved to 3.6 from 3.9 at the end of last year as a result of strong operating cash flow and favourable foreign exchange movements.

• Scripps Networks Interactive Inc. on July 1st concluded purchase transaction of 52.7% stake in TVN and announced the tender offer for remaining shares at PLN 20 per share on July 6th. The TVN Management Board issued its positive opinion on the conditions of the tender offer. The offer is open from July 24th till August 24th.

• Following the TVN Annual General Shareholders Meeting's approval of the Management

Board's resolution for dividend of PLN 102 million to be distributed from profits of year 2014, this shareholder's remuneration was paid in full on July 3rd.

1 Reported EBITDA adjusted for share of profit / loss of associates, dividends / distributions received from associates, one-off transaction costs and impairment of investments.

Press release TVN S.A.

Markus Tellenbach, Chief Executive Officer said:

"TVN results in the first half of the year reflect softer than expected performance of the main channel's programming schedule combined with lower advertising market dynamics which we attribute to uncertainties around Presidential elections in Poland as well as economic situation of Greece and its potential impact on European Union. In such market environment we have maintained our adjusted EBITDA profitability thanks to balanced revenue and operating costs growth, predominantly related to further investments in our programming offer.
We are now looking forward to the second half of the year, with bookings for July and August indicating acceleration in the market, which TVN will capitalize on with fall programming schedule introducing new shows and series."

In million PLN	Three months ended June 30th, 2015	Three months ended June 30th, 2014	Change
Revenue	445	434	+ 2.7%
Adjusted EBITDA	173	175	- 1.3%
Adjusted EBITDA margin	38.9%	40.4%	- 1.6pp
Reported EBITDA	164	183	- 10.1%
Reported EBITDA margin	36.8%	42.1%	- 5.2pp

In million PLN	Six months ended June 30th, 2015	Six months ended June 30th, 2014	Change
Revenue	808	784	+ 3.1%
Adjusted EBITDA	265	262	+ 0.9%
Adjusted EBITDA margin	32.8%	33.5%	- 0.7pp
Reported EBITDA	223	278	- 19.7%
Reported EBITDA margin	27.6%	35.5%	- 7.8pp

2 / 6

TVN Financial Highlights - Advertising Revenue Growth and Stabilized Adjusted EBITDA in a Moderately Softer Advertising Market Environment TVN revenue improved by 2.7% to PLN 445 million in the second quarter, driven predominantly by:

• TV airtime sales increase of 3.2%,
• Sponsoring revenue up by 1.9%,
• Subscription fees growth of 1.4%,
• Online revenue improving by 7.3%.
As a result, revenue in the first half amounted to PLN 808 million, up by 3.1% year-on-year.

Adjusted EBITDA slipped by 1.3% year-on-year to PLN 173 million in the second quarter, on the backdrop of investments in the programming schedule exceeding the impact of revenue growth. Adjusted EBITDA margin arrived at 38.9% compared to 40.4% in the second quarter of 2014. This, combined with the adjusted EBITDA growth of 5.3% in the first quarter, drove the six-months result to PLN 265 million, up by 0.9% year-on-year. Reported EBITDA reached PLN 164 million in the second quarter, translating into 10.1% year-on- year decline, reflecting PLN 17 million one-off impact of change of control transaction costs which more than offset improvement in the share of profit of associates. Reported margin also suffered moving to 36.8% from 42.1% in the second quarter of 2014. All in all, half year reported EBITDA declined by 19.7% to PLN 223 million under pressure of PLN 65 million of the change of control transaction costs, while the margin decreased year-on-year to 27.6% from 35.5%. Financial result reached PLN -106 million in the second quarter, compared to PLN -41 million in the second quarter last year, as a result of shift of foreign exchange impact from gains of PLN 6 million at the time to PLN 59 million of losses in the second quarter this year. However, half-year financial result of PLN -59 million was still stronger than PLN -117 million year ago thanks to lower interest, no financial costs related to early call of Senior Notes and positive foreign exchange impact for the six months period of 2015. Net profit attributable to the owners of TVN S.A. reached PLN 37 million in the second quarter and

PLN 116 million for the six-month period, compared to last year profits of PLN 115 million and PLN
126 million, respectively.
Net Debt was lowered to PLN 1.9 billion at June 30th, with a Net Debt / adjusted EBITDA ratio improved to 3.6x.
For more information please visit: www.investor.tvn.pl
For further information please contact:
Tomasz Poźniak
Head of Investor Relations
Emilia Ordon
Director of Public Relations,
Head of Corporate Communications TVN SA
w (+48 22) 856 66 14 w (+48 22) 856 67 97 mobile: (+48) 516 444 316 mobile: (+48) 502 555 937 e-mail: t.pozniak@tvn.ple-mail : press@tvn.pl

3 / 6

***
TVN is the leading media group in Poland and operates the following television channels:

TVN - a leading television channel on the Polish market, offering high quality entertainment as well as reliable and impartial news bulletins.

TVN24 is the first Polish round-the-clock news channel.

TVN24 Biznes i Świat is a news channel with a strong focus on business and international affairs. TVN Meteo Active focuses on active, healthy lifestyle, recreation, fitness and rational nutrition. Transformed from TVN Meteo, the first Polish weather channel. TVN Turbo is Poland's first thematic channel for men and the first to be devoted primarily to motorization. TVN Style is a television channel for women which focuses on beauty & health issues, lifestyle, and fashion. TVN Fabuła features an extensive offer of blockbuster movies and popular TV series from

TVN's portfolio as well as daily original shows for cinema lovers.

TTV - a television channel offering news, commentaries and social interest documentaries, available in cable networks, on digital platforms and within DTT.

TVN7 is a television channel which shows feature films and television series.

ITVN is a channel targeted at Polish viewers living abroad, available in Europe, North

America and Australia.

VN Extra is the second TVN's channel dedicated to Poles living abroad. The channel's rogramming offer includes entertainment, lifestyle, business, foreign and public affairs. Telezakupy Mango is the only round-the-clock teleshopping channel in PolandNTL is a local TV channel addressed to the residents of Radomsko and environs. TVN provides an extensive range of online products: tvn.pl - everything on TVN in one place. Contains information about popular series, programs and TVN's stars, as well as show-business news featuring fashion, beauty, cinema and entertainment. Gives ongoing access to full episodes of the most popular shows and series.

4 / 6

player.pl - video-on-demand platform, enabling online access to extensive collection of TV series, shows and programs. Also available for Android, iOS devices, PS3 consoles, TV sets of leading manufacturers as well as cable and satellite decoders. Gives access to pre-premiere episodes of selected popular programs. veedo.pl - an entertainment video portal featuring outstanding talents, remarkable events and web's best videos from all over the world. The website enables its users to upload their own short-form films and serves as a perfect platform for showcasing and promoting unique talents. It also includes the most attractive short- form videos from Polish and international media. Veedo users can evaluate video content using amusing stickers that express emotions the films arouse. tvn24.pl - news portal with the largest video library, effectively combines text and video. The leader in its category. tvnmeteo.pl - state-of-the-art weather portal in Poland, created by professional editors, Internet users and viewers interested in meteorology. Provides weather forecasts for over 80 thousand locations nationwide and worldwide. tvnwarszawa.pl - a media website dedicated to Warsaw and its residents. Focuses on life in the capital of Poland, providing high quality news and entertainment. Kontakt24.pl - an Internet service promoting the idea of civic journalism. Provides its users with a true influence over the content of TVN24 and the TVN24.pl portal.

TVN's portfolio also encompasses:

Advertising Office, TVN Media Sp. z o.o. - the largest advertising brokerage office in Poland, offering state-of-the-art communication on TVN channel, channels

included in the extensive portfolio of Premium TV as well as the richest offer of quality online video. The office was set up by a team of bold professionals who

create unconventional solutions for their customers.

Premium TV offers thematic channels and DTT aimed at demanding target groups desired by advertisers. Represents broadcasters such as TVN, Telewizja Puls,

4Fun Media, Viacom International Media Networks, Canal+ Cyfrowy, and the Walt Disney Company, Discovery Network, AXN Europe Limited, FOX International Channels and Telestar (iTV).

Agencja TVN - produces and distributes news materials for customers in Poland and abroad, renders TV production and broadcasting services. Offers the most extensive range of services in Central and Eastern Europe.

TVN Ventures - aims to support start-ups' and young companies' growth based on two alternative investment models: 'media for equity' or 'media for revenue'.
The companies receive advertising time in popular media, as well as business
counselling and international expansion opportunities.

TVN is a member of European Media Alliance.

European Media Alliance - a strategic alliance of European media companies:

5 / 6

TVN (Poland), Modern Times Group (CEE), ProSiebenSat1 (Germany), Antenna Group (Greece), Channel 4 (Great Britain), TF1 (France), Antena (Romania), Mediaset (Italy), Telecinco (Spain). The aim of the alliance is to identify new investment opportunities in the rapidly developing Digital & e-Commerce sector in the international environment, to support the companies planning to expand to European markets, to systematically share knowledge and experiences related to the implementation of innovative solutions in the media as well as to provide for a joint representation of interests in relations with external partners.
TVN S.A. is the founder of the TVN "nie jesteś sam" Foundation:

Fundacja TVN "nie jesteś sam" lends support to people suffering from incurable diseases requiring expensive therapy. Fundacja TVN also offers financial assistance to hospitals, orphanages and rehabilitation centers, covering the costs of renovation of their premises and purchasing medical equipment and ambulances. The activities of the foundation's office are fully financed from a donation made annually by its founder - TVN S.A.

TVN S.A. debuted on the Warsaw Stock Exchange on December 7th, 2004. TVN's press resources are available on www.prasa.tvn.pl

6 / 6