click to edit master title style csc media group

Click to edit Master title styleCSC Media Group

Click to edit Master title style

• CSC Media Group comprise a bouquet of thematic channels in the UK

• CSC Media Group is controlled by the venture capital group VSS (60%) with the remainder held by management and the original founders

• VSS is conducting a competitive sale process for 100% of the business

• SPT is one of the selected parties to move forward in the due diligence process• SPE believes that we are part of a very small number of bidders• NBC Universal, Turner, Cello/Liberty and Scripps are out of the process

CSC Media Group

2


TRUE CHANNELS• Complimentary audience demographic and brand• Delivers shelf space to increase efficiencies and sweat program assets across portfolio• Sony become #2 movie provider on Sky (after Sky premium movies)• Low cost content model improves opportunity to launch on Freeview• Leverage SPT infrastructure to develop low cost global movie channel proposition

MUSIC CHANNELS• Limited strategic fit with Sony portfolio, concern over long term business sustainability• Box TV (Channel 4/Bauer JV) is one of the major music channel players in UK• CSC music channels would position Box TV as #1 linear music channel provider

KIDS CHANNELS• Potential complimentary genre for SPT but limited in-house expertise• Kids Channels forecast to achieve 25% market share in 2012• Digital properties and merchandising forecast to drive growth• Switchover operates FTA kids business in Italy using similar low cost model as CSC• Evaluate option for SPT to take a minority stake (with path to control)

Consortium bid approach

3

Awaiting feedback from VSS to confirm if they are happy to proceed with either stand alone or consortium bid approach

Box TV

SwitchOver/Rubis

CSC

SONY

SPT is proposing to acquire True channels either alone or as part of consortium bid

Click to edit Master title styleChannel 6


• Analogue switchoff has released a one-off supply of DTT capacity in the UK

• In Sep 2012 Ofcom plan to utilise this capacity by licensing a number of ‘local’ TV channel franchises across the UK

• Franchises will be granted PSB status in exchange for producing socially valuable local programming (approx 2 hrs/day)

• PSB status guarantees the channels prominent EPG positions (Slot 108 on Freeview, Slot 117 on Sky)ONE TIME OPPORTUNITY

• London is the largest license reaching over 12MM people

• Submissions are due to Ofcom by August 13th

UK local TV

5


• Proposed Joint Venture between Archant Ltd (London local news/magazine/ website publisher), management and a strategic investor

• Archant is subscribing for 10%-25% of the equity mainly through non-cash consideration

• Management includes Richard Horwood (formerly Trinity Mirror) and Clive Jones (formerly head of ITV Networks, GMTV and ITV news)

• Strategic investor would have majority stake and control – management stake to be discussed

• Unique opportunity to secure premium EPG position on key platforms

• Signed NDA and started initial discussions with management• Anticipated total DWM of approx $25MM-$30MM• Option to fund SPT share with mix of cash and content

• Evaluate alongside CSC Media Group opportunity

Channel 6

6

Click to edit Master title styleAnimax UK


• Premium VOD service targeting UK Anime audience (0.5MM Facebook fans)• New business model for SPT – deliver key learnings for development of digital strategy• Test concept in single market to evaluate further territory and brand launches

Linear• Animax branded “Anime season” on Sony’s UK channels• Planned Launch: October 2012Digital on demand streaming service• SVOD £5.99 / month• Planned Launch: October 2012

Key Consumer Offers• Unlimited access to content• Subscription service is ad free for consumers• Simulcast latest shows from Japan• Movies• Added value content from Animax Japan

Animax UK


Partner responsibilitiesSony Viz Media

Program acquisition and delivery of material

Subbing/dubbing (where required)

Transcoding and Metadata

Service development and operations

Billing/Payments (via Invideous)

Ad sales (via Dolphin/Videology)

Marketing


Finalise long form agreements • Invideous• Viz Media• PlaystationBuild service

Timelines

Nov/Dec 2013

Jul/Aug 2012

Sep 2012

Oct 2012

Launch iOS and Android appsXmas marketing push (Facebook, DVD sleeves and Anime magazines)

VOD launch (website and PS3)Linear launchLaunch marketing activity (London Comicon, Anime Film Festival, Playstation)

Beta launch (website)Finalise launch marketing plan

Q4 FY13 Launch on TV Player (new OTT platform)


FINANCIALS

FY 13 FY 16

Q2 Forecast August 2011 August 2012 Total Variance August 2011 August 2012 Total Variance August 2012Sub Revenue - Cable - - - - - - - - Sub Revenue - DTH - - - - - - - - Total Affiliate Revenue - - - - - - - - Ad Revenue - - - - - - - - Bad Debt - - - - - - - - Other Revenue 292 - 1,028 1,028 - 1,352 1,352 1,593

Total Net Revenue 292 - 1,028 1,028 - 1,352 1,352 1,593

Programming Amortization - - - - - Other Programming - - - - - - - - Original Production - - - - - - - - Network Operations (162) - (149) (149) - (189) (189) (279) Other (68) - (355) (355) - (473) (473) (562) Total Cost of Sales (229) - (504) (504) - (663) (663) (841) Selling (29) - (100) (100) - (125) (125) (147) Marketing (100) - (125) (125) - (151) (151) (170) Total Selling & Marketing (129) - (225) (225) - (277) (277) (317) Staff (124) - (170) (170) - (175) (175) (181) G&A and Other (30) - (41) (41) - (42) (42) (44) Depreciation - - - - - - - - Total Overhead (154) - (212) (212) - (218) (218) (224) Other Income/(Expense) - - - - - - - -

Total Expenses (512) - (940) (940) - (1,157) (1,157) (1,382)

EBIT (220) - 89 89 - 194 194 211 EBIT as % of Revenue -76% N/A 9% N/A 14% 13%

Net Cash Flow Before Financing (220) - 89 89 - 194 194 211

Headcount 3 - 3 3 - 3 3 3

FY 14 FY 15

Click to edit Master title styleNorway


Norway Market Overview

GDP per capita 2011(USD ‘000s)

Unemployment rate 2011

UK 38 8.0 %

Germany 44 6.0 %

France 44 9.7 %

Norway 97 3.3 %Source: IMF Outlook April 2012

• Stable economy driven by rich natural resources and conservative economic policies

• TV Population of 4MM adults (12+)

• One of the highest GDP per Capita in Europe

Click to edit Master title styleNewspapers,

1,047

Magazines, 104

TV, 607Radio, 101

Cinema, 26

Outdoor, 101

Internet, 777

Ad market Norway Ad Market 2011 (USD$MM)

• Highly developed TV market

• PSB broadcaster NRK is not allowed to carry commercial advertising (similar to BBC)

• TV advertising forecast to grow approx 5% YOY

• Regulation permits advertising minutage up to 15% of total schedule (20% in any 1 hour)

• Average viewing has remained constant at approx 180 mins/day

-15.0

-10.0

-5.0

0.0

5.0

10.0

15.0

2,008 2,009 2,010 2,011 2,012 2,013 2,014

Annual TV Advertising growth

TV

Source: Nielsen May 2012


Commercial TV Market share

Source: TNS Gallup June 2012

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%TV

2

TV2

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TV2

…

TV2

Blis

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TVN

org

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FEM

MA

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TV3

Via

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Dis

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Fox

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Commercial Audience Share In-home Distribution


TV Maritim• TV Maritim will be a new FTA general entertainment channel

• Potential distribution to over 90% of TV Households

• Channel brand designed to resonate with Norwegian population• 76% live in coastal communities• 20% have a maritime related income• 36% of families own a boat

• Broad programming mix including dramas, documentaries, factual entertainment and features

• Investment in local production

• Experienced management team• Launched and successfully built TV Norge in to leading FTA channel• Strong relationship with Norwegian Operators and Advertisers

• Opportunity to take a majority stake in the business


Distribution

• Negotiations with all operators underway

• Canal Digital carriage is critical to channel success (47% of total HH’s)• Initial feedback is positive• Includes CD providing marketing support across TV, print and Radio

• Total cost for securing 77% distribution in Norway per year estimated at $1.4MM(forecast to reduce over time as channel becomes established)

• Plan to finalise negotiations with Operators in August

• Opportunity to secure top 20 position on EPGs and distribution in basic packages

• Subscription revenues for all established TV channels are still common

• However new channels must pay for distribution until they become “must have”(approx 3%-5% viewing share)

% Distribution

23%

7%

11%14%

24%

Canal Digital Sat NOK 3.5mill

Viasat Sat NOK 1.5mill

Altibox NOK1.5mill

RiksTV NOK 1 mill

Canal Digital Cable NOK 1 mill


Programming and audienceMON TUE WED THUR FRI SAT SUN

Disaster - La Nina StrikesThe Vanishing Antarctic Tara Oceans Sea Otters: Mill ion Dollar BabyGreenpeace: The story Fish Town SEX under the sea

That's Boating Inside Angling That's Boating The Take That's Boating Inside Angling The Take

1930

AFP AFP

Fish Town SEX under the sea Coast II Surf Art Waterfront Cities of teh WorldMINI SERIES DRAMAs DRAMAs

2000 Acres of Sky

BlackpoolDRAMA TRAVEL TRAVEL TRAVEL TRAVEL DRAMA MINI SERIES

REPEAT REPEATBlue Addiction Island Hoppers Seas Island Hoppers

MOWs MOVIE Night MOVIE Night MOVIE Night

2100

2200

2300

1800

1900

2000

DOCUMENTARIES

REPEAT REPEAT

DOCUMENTARIES

LEISURE/FISHING

AFP


Draft management forecastsUSD FY13 FY14 FY15 FY16

Advertising revenue 0.3 5.1 11.7 18.0Subscription revenue 0.0 0.0 0.0 0.0Total revenue 0.3 5.1 11.7 18.0

Growth % 1933% 130% 25%

Program acquisition 0.2 0.9 1.0 1.0Local Production 0.1 2.8 4.4 5.5On-air, scheduling, production, traffi c 0.5 1.7 1.8 1.8Net Ops 0.6 2.2 1.3 1.3

Total operating costs 1.4 7.6 8.5 9.7Growth % 444% 12% 14%

Sales 0.6 0.9 1.1 1.4Marketing 0.6 1.0 0.9 1.2G&A 1.7 1.4 1.5 1.5Management board 0.1 0.0 0.0 0.0

Total sales and admin 3.0 3.2 3.6 4.27% 12% 17%

Total expenses -4.4 -10.8 -12.1 -13.9Depreciation -0.1 -0.1 -0.1 -0.1

EBIT -4.3 -5.8 -0.5 4.0Margin % -1691% -114% -4% 22%

Cashflow -6.5 -7.2 -1.7 1.0Cum Cashflow -6.5 -13.6 -15.3 -14.4

• EBIT positive FY16

• Total $15MM DWM

• FY13 $6.5MM

• Headcount 28


Key CHANNEL TARGETS and opportunities

Key Targets/Risks

• Canal Digital carriage(secure carriage with main operators in advance)

• Commercial audience share of 4%-5% by FY16(straight GRP market – ratings directly convert to revenues)

Opportunities

• Develop Norwegian thematic channel bouquet leveraging TV Maritim infrastructure

• Launch TV Maritim concept in to Sweden and Denmark• Similar language, culture and affinity with the sea• Pan-regional operators facilitate distribution discussions


NEXT steps & proposed timeline

August 2012 Finalise business plan

September 2012

Present to Sony management for review

Start long form documentation

October 2012 Sony Management approval and deal close

October – December 2012

Pre-launch activity

January 2013 Channel launch

Click to edit Master title styleTURKEY


0

2

4

6

8

10

12

2011 2012 2013 2014 2015 2016

% G

row

th

Economic forecasts

GDP growth % Unemployment Inflation

Turkey economic outlook

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2010 2011 2012 2013 2014

Advertising spend ($MM)

Internet

Outdoor

Cinema

Radio

Magazines

Newspapers

TV

Source: Zenith Optimedia forecasts May 20122012Source: IMF Outlook April 2012


Overview of ad market dynamics

TV Trading environment

• TV ratings in Turkey were suspended in Dec 2011 after fraud investigations

• TNS were appointed to replace AGB and were due to start in May 2012

• However due to issues with the independent auditor (TIAK) the new panel has not yet been implemented

• This has resulted in advertisers holding back TV spend until 2H 2012

• TV ad market will continue to remain uncertain until ratings panel resolved

Solution for Sony

• Dogus continue to represent ad sales for e2 post acquisition

• Secured ad revenue MG for 2012 and 2013 to mitigate short term risk


E2 operations

Strategy in short term to leverage Dogus infrastructure post acquisition

Channel operations post close• 4 SPT heads based in Dogus offices (Territory Director, finance and marketing)

• Dogus will continue to provide services to e2 under SLAs• Program acquisition co-operation agreement• Ad sales representation (with MG)• Channel operations (versioning, scheduling, playout, on-air, traffic, office

space)• Channel promotion and marketing commitment

• The services are provided in-kind for the first 6 months

• Thereafter they are provided for a fixed monthly fee for a period up to 31 Mar 2014

• SPT has an option to terminate some or all of the services at any time


E2 programming

Existing program rights transferred from DogusAll Rights Sony take 1st Run Sony take 2nd Run

Bored to Death Conan O'Brien DexterIt's Always Sunny in Philadelphia Family Guy Game of ThronesBreaking Bad The Closer SeaEllen Show Vampire DiariesMartha Stewart Show Gossip Girl

Future co-op agreement with Dogus

• Sony and Dogus approach distributors together to acquire product

• Benefit from Dogus scale and leverage in the market

• Discussions to date include HBO, Endemol, LionsGate and SPT


E2 key deal terms

Agreed headline deal terms with Dogus:

• $7.5M purchase price paid $5M at close and $2.5M in FY14

• 6 months in-kind operational services support (technical operations and facilities) (value ~$380K)

• In-kind marketing support through 2013 (value ~$280K)

• MG of 100% of gross revenue from close to Dec 2012

• MG of 95% ($5.5MM) of forecast gross revenue for CY2013 (13% YOY growth)


NEXT steps & proposed timeline

July Incorporated EUK local subsidiary

Commenced Due Diligence on the Company by SPT

30th July Completion of due diligence

6th August Completion of draft Transaction documents

20th August Approval of relevant SPT/Dogus Boards

21st August Execution of SPA Notification to RTUK of proposed change in control of the Company Registration of relevant competition filings/notices

September Competition approval Execution of Key Agreements


Financials FY13

Channel Budget Q2 Forecast FX Variance Operational

Variance Variance

Average Paying Subscribers (in 000s) - - -

Sub Revenue - Cable - - - - - Sub Revenue - DTH - - - - - Total Affiliate Revenue - - - - - Ad Revenue 4,265 3,315 - (950) (950) Bad Debt - - - - - Other Revenue - - - - -

Total Net Revenue 4,265 3,315 - (950) (950)

Programming Amortization (1,992) (1,588) - 404 404 Other Programming (295) (259) - 37 37 Original Production - - - - - Network Operations (733) (662) - 70 70 Other (1,056) (1,454) - (398) (398) Total Cost of Sales (4,076) (3,963) - 113 113 Selling (563) (641) - (78) (78) Marketing (267) (245) - 22 22 Total Selling & Marketing (830) (886) - (57) (57) Staff (395) (200) - 195 195 G&A and Other (74) (8) - 66 66 Depreciation (6) (5) - 1 1 Total Overhead (475) (213) - 262 262 Other Income/(Expense) - - - - -

Total Expenses (5,381) (5,062) - 319 319

EBIT (1,116) (1,747) - (631) (631) EBIT as % of Revenue -26% -53%

Net Cash Flow Before Financing (3,523) (5,486) - (1,962) (1,962)

Headcount 8 4 (4)

FY 13


Financials FY13-FY16FY 13 FY 16

Q2 Forecast August 2011 August 2012 Total Variance August 2011 August 2012 Total Variance August 2012

Average Paying Subscribers (in 000s) - 590 - (590) 1,217 - (1,217) -

Sub Revenue - Cable - - - - - - - - Sub Revenue - DTH - 1,185 - (1,185) 2,328 - (2,328) - Total Affiliate Revenue - 1,185 - (1,185) 2,328 - (2,328) - Ad Revenue 3,315 5,942 5,793 (149) 7,469 6,937 (532) 8,237 Bad Debt - - - - - - - - Other Revenue - - - - - - - -

Total Net Revenue 3,315 7,127 5,793 (1,335) 9,797 6,937 (2,860) 8,237

Programming Amortization (1,588) (3,386) (2,588) 798 (3,989) (2,847) 1,142 (3,132) Other Programming (259) (559) (412) 146 (610) (445) 165 (481) Original Production - - - - - - - - Network Operations (662) (1,483) (1,080) 403 (1,520) (1,424) 96 (1,495) Other (1,454) - (1,926) (1,926) - (577) (577) (394) Total Cost of Sales (3,963) (5,428) (6,006) (578) (6,119) (5,293) 826 (5,502) Selling (641) (744) (1,120) (377) (1,081) (1,342) (261) (1,593) Marketing (245) (753) (415) 337 (1,041) (541) 499 (581) Total Selling & Marketing (886) (1,496) (1,536) (40) (2,122) (1,883) 239 (2,174) Staff (200) (667) (317) 350 (696) (602) 94 (662) G&A and Other (8) (480) (12) 468 (489) (315) 174 (336) Depreciation (5) (972) (88) 885 (655) (218) 436 (224) Total Overhead (213) (2,119) (417) 1,703 (1,840) (1,135) 705 (1,222) Other Income/(Expense) - - - - - - - -

Total Expenses (5,062) (9,044) (7,958) 1,085 (10,081) (8,312) 1,769 (8,897)

EBIT (1,747) (1,916) (2,166) (249) (284) (1,375) (1,091) (660) EBIT as % of Revenue -53% -27% -37% -3% -20% -8%

Net Cash Flow Before Financing (5,486) (1,881) (4,056) (2,175) (242) (908) (666) (70)

Headcount 4 12 4 (8) 12 10 (2) 10

FY 14 FY 15

Click to edit Master title styleV-NETWORKS AFRICA


• V-Networks is a new African broadcaster set up by Phil Schmidt (ex SPT)

• V-Nets is in negotiations with Multichoice to launch a new thematic channel targeting the African pay TV audience

• V-Nets has approached SPT about investing in the channel (up to $5MM)

• Investment would be subject to finalising carriage agreement with Multichoice

V-Networks

Africa’s Novela Channel

The entry-tier channel for women in Africa.

Telenovelas, soaps, reality and dramas. In English and Portuguese.


V-Networks


Vida programming mix

Intl.18%

African21%Latin

61%

Sources

2nd Run18%

1st Run82%

Run

• Launch with 700 hours of content (550 hours for Portugese feed)

• Annual refresh• Acquired content 75%• Original Productions 100%


Financial Summary

35

USD '000s FY13 FY14 FY15 FY16 FY17 Cumulative

Subscribers ('000s) 2,595 5,403 5,932 6,651 7,973 28,554

REVENUEDistribution 1,750 3,675 4,043 4,447 4,891 18,806Advertising 0 100 350 625 875 1,950

TOTAL REVENUES 1,750 3,775 4,393 5,072 5,766 20,756116% 16% 15% 14%

OPERATING EXPENSES0

Programming 469 1,315 1,513 1,368 1,437 6,103Dubbing 0 0 24 73 98 196Sales & Marketing 464 365 399 445 498 2,171On-air, Servicing & Music 511 524 502 585 615 2,736Network Operations 587 601 615 630 646 3,079Staffing 707 681 687 725 765 3,565G&A 684 553 584 632 685 3,139

TOTAL COSTS 3,422 4,039 4,324 4,459 4,744 20,989

EBITDA -1,672 -264 68 613 1,022 -233Margin -96% -7% 2% 12% 18% -1%Depreciation & Amortisation 20 14 14 14 14 74

EBIT -1,692 -278 55 599 1,009 -308Margin -97% -7% 1% 12% 17% -1%Corporation tax 0 0 0 0 45 45

NET INCOME -1,692 -278 55 599 964 -352Margin -97% -7% 1% 12% 17% -2%

FREE CASH FLOW -2,434 -641 -4 444 831 -1,804Terminal Value (10x EBIT) 10,088 10,088

FCF incl. Terminal Value -2,434 -641 -4 444 10,919 8,285

CUME FREE CASH FLOW -2,434 -3,075 -3,079 -2,635 8,285 -2,939

Total Investment -3,079NPV (15% WACC) 3,709Post-Tax IRR 40%Cash Flow Breakeven Year 3Cume CF Breakeven Year 5


Strategic fit and Deal structure

36

Female skewing Vida would be a complimentary fit for SPT Africa Networks alongside family SET and male skewing Max

Delivers scale and shelf space• Cross-demographic commercial impacts supports ad sales• Increases operational efficiencies• Improves scale for Multichoice renegotiations

Deal structure options under discussion• Equity investment in new V-Nets Company with SPT NetOps SLA• V-Nets assigns Multichoice contract to SPT• Future role for Phil Schmidt

Next steps:• Confirm carriage terms with Multichoice and launch timing (Nov 2012)• Finalise deal structure terms with V-Nets

Click to edit Master title styleMIDDLE EAST AND NORTH AFRICA


Middle East Opportunity

Arab region has one of the youngest populations in EMEA (60% pop. < 25 years old)

Arab Spring has inspired youth to actively engage in media with increased freedom

Incumbent channels mainly focused on general entertainment and news

Opportunity to create a youth channel that is relevant to their environment

• Multiplatform• Audience interaction• Free to air


GNAM – a Diverse media group

WEISS

Global New Age Media

Broadcasting

Mobile

Movies & TV Films Production

TIGERPRODUCTION

Licensing

Ad Sales/Marketing

Publishing Online


Broadcast Overview

• SpaceToon – successful kids channels targeting 3-10yrs• Airtime sales• Brand driver for Franchises

•Space Power originally launched as extension to SpaceToon• Targeting 12yrs-18yrs• Manga, Sci Fi, Xtreme Sports, thriller/drama• 2nd run (1st dub) Prison Break, Matrix• Channel currently underperforming

• In-house dub/sub and playout facilities

• Kids Media (50:50 JV GNAM and management)• Ex MBC sales team• Reps GNAM channels, CNBC and Fatafeat (cooking)• Ad sales, marketing and research


GNAM partnership opportunityOpportunity to partner with GNAM across the MENA region

Proposed deal structure:• Sony acquire 51% equity of Space Power (“SP”) Channel for $6MM-

$8MM (subject to negotiation and DD)

• Develop FTA youth channel leveraging existing SP channel infrastructure and distribution across MENA

• Each partner funds pro-rata share of future cash requirements

• Branding options include Sony Spin

Other opportunities to be discussed separately• Additional channel launches


Process and timelines

July-August 2012 Develop detailed business plan with GNAM

[Commence commercial due diligence in parallel]

Early Sep 2012 Present plan to management for review

September 2012 Due Diligence

October Finalise deal structure and termsDraft Transaction documents

November Execution of SPA

Q4 FY13 Channel Launch


Other potential opportunities

Rotana Group

• NewsCorp currently own 19% of Rotana as well as 3 channel JVs• Indications are that channel JV relationship is not working• Rotana own largest Arabic music label and ~40% of all Arabic movies• Rotana are interested in working with SPT on channels across the region

• Movie channel and Youth channel• Structure could be equity JV or service agreements• Schedule follow up meeting with Rotana to discuss further

Qatar TV

• Government looking to develop Qatar as a media hub• Qatar owns and operates Al Jazeerah news, sports and kids channels• Looking for partner(s) to launch a pan-regional FTA GE channel• Mix of acquired and original production (circa $30MM budget)• SPT Production coordinating with Qatar to set up initial meet

click to edit master title style csc media group

Documents

uk csc music channels

master title style channel

uk csc media group

process csc media group

business spt

spt share

consortium bid slide

th uk local tv