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KEW MEDIA GROUP Reports Second Quarter 2019 Financial Results Reaffirms Full Year 2019 Outlook

Toronto, ON, August 13, 2019– KEW MEDIA GROUP INC. (“KEW MEDIA”, “KEW” or the “Company”)

(TSX:KEW and KEW.WT) today released its financial results for the three and six months ended June 30, 2019

(“Q2 2019”). KEW MEDIA’s interim condensed financial statements along with its Management’s Discussion and

Analysis for Q2 2019 are available on the Company’s investor relations website at https://investors.kewmedia.com

and under the Company’s profile at www.sedar.com. All financial results are reported in Canadian dollars unless

otherwise stated.

Q2 2019 Highlights

• Revenue of $69.1 million (2018: 49.8 million)

• Gross Profit1 of $21.3 million (2018: $13.4 million)

• General and Administrative expenses2 (“G&A”) of $13.6 million (2018: $11.6 million)

• Adjusted EBITDA3 of $7.8 million (2018: $2.7 million)

• Net income of $0.2 million (2018: Net loss of $(5.0) million)

• Adjusted Net Income4 after tax5 of $7.2 million (2018: $0.9 million)

• Free Cash Flow (FCF)6 before movements in working capital and film and television rights of $4.6 million

(2018: $1.0 million)

• FCF after movements in working capital and investments in film and television rights of $0.9 million

(2018: $(8.7) million)

• Reaffirmed full year 2019 outlook of mid to high single digit percentage organic growth over the

annualized Pro forma 2018 Adjusted EBITDA of $31.9 million7

1 Gross Profit is revenue less cost of sales.

2 The increase of $2 million in G&A was primarily due to the Essential acquisition last year and centralized infrastructure costs, as contemplated

in our full year 2019 outlook.

3 Adjusted EBITDA is EBITDA excluding certain items to better analyze trends in performance and after non-controlling interests. These

adjustments result in a truer economic representation on a comparative basis. Adjusted EBITDA includes the add-backs made to calculate the

Adjusted Net Income and additional add-backs for interest expense, net of interest income, depreciation and any non-cash amortization (to the

extent not added to Adjusted Net Income). See “Non-IFRS Measures” and “Forward-Looking Statements” below in this press release.

4 Adjusted Net Income is income (loss) before income tax recovery then includes add-back adjustments for items such as transaction costs,

reorganization and exceptional costs, share-based compensation, deferred compensation, other intangibles amortization, gain on change in fair

value of financial liabilities, and gain (loss) on foreign exchange on financial liabilities. See “Non-IFRS Measures” and “Forward-Looking

Statements” below in this press release.

5 Adjusted Net Income after tax is Adjusted Net Income less income tax recovery.

6 Free Cash Flow is Adjusted EBITDA adjusted for additions to Property and Equipment, Interest and cash taxes.

7 2018 Pro forma Adjusted EBITDA is $31.9 million, being the 2018 Adjusted EBITDA of $26.9 million plus an additional approximate $5 million

from the period January 1, 2018 to the date of acquisition to reflect a full year’s results of Essential.

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(in millions of Canadian dollars, except per share data) Three months ended Six months ended

June 30, 2019 June 30, 2018 % Change June 30, 2019 June 30, 2018 % Change

Revenue

Production $46.0 $37.4 23.0 % $79.6 $61.9 28.6 %

Distribution $23.1 $12.4 86.3 % $41.5 $27.7 49.8 %

Total $69.1 $49.8 38.8 % $121.1 $89.6 35.2 %

Gross Profit

Production $11.7 $8.0 46.3 % $20.7 $14.4 43.8 %

Distribution $9.6 $5.4 77.8 % $14.6 $11.8 23.7 %

Total $21.3 $13.4 59.0 % $35.3 $26.2 34.7 %

Gross Profit Margin - Production 25.4 % 21.4 % 26.0 % 23.3 %

Gross Profit Margin - Distribution 41.6 % 43.5 % 35.2 % 42.6 %

Gross Profit Margin Total 30.8 % 26.9 % 29.1 % 29.2 %

Adjusted EBITDA after NCI $7.8

$2.7

188.9 % $7.6

$5.1

49.0 %

Net income (loss) for the period $0.2

$(5.0 ) N.M. $(7.7 ) $(5.2 ) N.M.

Adjusted net income after tax $7.2

$0.9

700.0% $6.0

$3.5

71.4 %

Basic and diluted loss per share $(0.03 ) $(0.45 ) N.M. $(0.66 ) $(0.51 ) N.M.

Adjusted earnings per share $0.53

$0.07

657.1% $0.44

$0.30

46.7 %

Steven Silver, Chief Executive Officer of KEW MEDIA, commented, “KEW's strong momentum continued into the

second quarter and met our expectations, largely driven by high revenues from both our production and distribution

segments. We are beginning to see the benefits of our significant investment in film and television rights last year

and expect this momentum to continue. Based on our performance through the first half of the year and the current

visibility into the second half of the year, we reaffirm our 2019 outlook to deliver mid to high single digit

percentage organic growth over the annualized Pro forma Adjusted EBITDA of $31.9 million."

Peter Sussman, Executive Chairman of KEW MEDIA, added, "We continue to see growth in our sector in both

financial and non-financial metrics. In particular, the explosion of subscription video on demand platforms across

the world, together with ongoing purchasing from traditional platforms, continues to fuel demand across a range of

content. As we wrap up our traditionally busy production season and move into our sales-heavy fall and winter

seasons, we are pleased with our progress and are confident in our future. There are no signs of the appetite for

content slowing, and we will continue to produce and sell to eager buyers around the world.”

Financial Highlights for the Three Months Ended June 30, 2019

KEW MEDIA’s results in any given quarter or year can be affected by seasonality and/or specific product mix

timing. Typically, production occurs over the summer and starts delivering in the fall and winter months, when the

majority of revenues and profits are achieved.

Q2 2019’s revenue of $69.1 million was comprised of $46.0 million from Production and $23.1 million from

Distribution. Gross Profit of $21.3 million included $11.7 million from Production and $9.6 million from

Distribution. Gross Profit Margin and was 30.8%, with segmented Gross Profit Margin of 25.4% for Production and

41.6% for Distribution. Overall and Segmental margins met management’s expectations for the quarter with

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Production Gross Profit Margins higher in the period this year due to the introduction of Essential and Distribution

Gross Profit Margins being marginally lower due to product mix and revenue recognition timing. Adjusted EBITDA

was $7.8 million, the Net income was $0.2 million, the loss attributable to the equity holders of the parent was

$(0.03) per share and Adjusted Net Income after tax was $7.2 million, or $0.53 per share.

Segment Information

Production

During the second quarter, Revenues were $46.0 million, an increase from the same period in 2018 of 23%, Gross

Profit was $11.7 million, an increase of 18.7%, and the Gross Margin percentage was 25.4% (2018: 21.4%). G&A

increased by $1.3 million to $6.3 million. These increases were predominantly due to the inclusion of Essential.

Adjusted EBITDA increased by 65.4% to $4.3 million with the positive change being driven by increased

production volume across the group. Titles produced include: Essential's Texas Flip 'N Move seasons 12 and 13 for

DIY Network in the US and Body Hack season 3 for Network Ten in Australia, Collins Avenue's Dance Moms

season 8 for A&E in the US, Jigsaw Productions' The Family for Netflix and Frantic Films' Baroness von Sketch

season 4 for CBC in Canada.

Distribution

During the second quarter, Revenues were $23.1 million, an increase of 86.3%, Gross Profit was $9.6 million, an

increase of 77.8%, and the Gross Margin percentage was 41.6% (2018: 43.5%). G&A increased by $0.5 million to

$4.8 million. Adjusted EBITDA increased by 284.6% to $4.9 million. The segment’s revenues benefited from the

delivery in the quarter of some higher revenue/low margin titles. Consequently, while Revenues increased, Gross

Profit margins decreased compared to Q2 last year, which had a product mix with comparatively higher margin

titles. Titles distributed across the segment included: Line of Duty season 5, Bletchley Circle: San Francisco, My

Crazy Birth Story, Egypt's Unexplained Files, Massive Engineering Mistakes, and Shocking Emergency Calls.

Gross Profit and G&A

KEW MEDIA focuses on Gross Profit as a performance indicator given that the Company has a diverse product

range with some low revenue items attracting 100% Gross Profit Margins and other high revenue items having

Gross Profit Margins as low as 5%. Gross Profit for Q2 2019 was $21.3 million compared to $13.4 million last

year, an overall increase of 59%.

G&A increased in the quarter to $13.6 million compared to $11.6 million last year. This was predominantly due to

budgeted increases in corporate overhead as well as the inclusion of Essential in the production segment.

Developments in the Quarter

There were a number of positive developments in the quarter. These include:

• Leaving Neverland continues to captivate buyers and audiences. Kew Media Distribution (KMD) has sold

the 2-part documentary series to every territory in the world save China. It was also recently nominated for

5 Emmy Awards, as was the recipient of a Television Critics Association award for best news and

information program.

• The popular Dance Moms started delivering episodes from its 8th season to A&E in Q2.

• Jigsaw delivered The Family for Netflix, a five-part docuseries on an enigmatic conservative Christian

group known as the Family which wields enormous influence in Washington, D.C., in pursuit of its global

ambitions. The show launched on the global streamer on August 9.

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• In the Production segment, production commenced on a raft of titles including The Trickster for CBC, Hot

Market for HGTV Canada, Griff's Kiwi Adventures for Prime New Zealand, and Haunted Hospitals season

2 for Travel Channel Canada. New series were also commissioned including Volcano Walk Live for A&E in

the US from Essential and Frankie Boyle's Scotland for BBC Two from Two Rivers Media.

Balance Sheet and Net Debt

As of June 30, 2019 the Company had cash and cash equivalents of $26.2 million, approximately $11.9 million in

loan availability and Net Debt8 of $99.7 million.

Adjusted Net Debt9 as of June 30, 2019 was $85.8 million. This figure takes into account material foreign exchange

movements since the beginning of the year and amounts expended by KEW MEDIA’s treasury on interim

production financing.

The Adjusted Net Debt of $85.8 million to Pro forma 2018 Adjusted EBITDA of $31.9 million is 2.7:1. The

Company continues to anticipate that this ratio will reduce further into 2019 with an overall target of 2.1 or below,

reflecting the projected growth in our Adjusted EBITDA for the year, together with the expected benefits from

positive cash flow generation.

Free Cash Flow (FCF)

FCF before movements in working capital and before movements in film and television rights was $4.6 million

compared to $1.0 million last year. FCF after movements in working capital but before investments in film and

television rights was $(2.2) million compared to $(4.6) million last year. After movements in both working capital

and investments in film and television rights, FCF was $0.9 million compared to $(8.7) million last year. As KEW's

significant FY18 investment in film and television begins to provide returns, the cash flow generative nature of the

overall business is starting to emerge.

At the segment level, Production FCF before movements in working capital and investments in film and television

rights was $3.1 million. FCF after movements in working capital but before movements in investments in film and

television rights was $(2.1) million. After movements in both working capital and investments in film and television

rights, FCF was $0.8 million).

Distribution FCF before movements in working capital and movements in investments in film and television rights

was $4.5 million. FCF after movements in working capital but before movements in investments in film and

television rights was $1.1 million. After movements in both working capital and investments in film and television

rights, FCF was $1.4 million.

Outlook10

For the full year 2019, KEW MEDIA continues to expect a range of mid to high single digit percentage organic

growth on full year 2018 Pro forma Adjusted EBITDA of $31.9 million. KEW MEDIA’s results in any given

quarter or year can be affected by seasonality and/or specific product delivery timing. Typically, production occurs

over the summer and starts delivering in the fall and winter months. As reflected in our 2018 performance, our 2019

results are expected to be heavily weighted in the fourth quarter.

8 Net Debt is debt less any cash and cash equivalent balances.

9 Adjusted Net Debt is Net Debt less interim production loans provided by KEW MEDIA treasury less effect of foreign exchange movements. See

“Non-IFRS Measures” and “Forward-Looking Statements” below in this press release.

10 The statements set out in this Outlook section are based on management’s assumptions, current strategies and assessment of the outlook for

the business. Given the seasonal and other fluctuations in KEW MEDIA’s business, the Company may not be in a position to provide periodic

updates on its progress in meeting its expectations. These statements constitute forward looking information for purposes of applicable

Canadian securities legislation and readers are cautioned that KEW MEDIA’s actual result may vary from these forward looking statements and

that variation could be material. See “Forward Looking Statements” for a description of the assumptions and risks associated with these forward

looking statements.

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Conference Call

KEW MEDIA will host a conference call to discuss the second quarter 2019 financial results on August 14, 2019 at

9:00 a.m. ET. The conference call can be accessed live over the phone by dialing 877-407-0784 (USA and Canada)

or 201-689-8560 (International). The conference call replay will be available via webcast through KEW MEDIA's

Investor Relations website. The telephone replay will be available from 12:00 p.m. Eastern Time on August 14,

2019, through August 21, 2019, by dialing 844-512-2921 (USA and Canada) or 412-317-6671 (International). The

replay passcode will be 13692653.

The call will also be webcast live from KEW MEDIA’s investor relations website at

https://investors.kewmedia.com. Following completion of the call, a recorded replay of the webcast will be

available on the website.

About KEW MEDIA GROUP INC.

KEW MEDIA GROUP is a leading publicly-listed content company that produces and distributes multi-genre

content worldwide. Companies included in the KEW family are the production companies: Architect Films,

Awesome Media & Entertainment, Bristow Global Media, Collins Avenue Productions, Essential Media Group,

4East Media, Frantic Films, Jigsaw Productions, Media Headquarters, Our House Media, Sienna Films, Spirit

Digital Media, and Two Rivers Media; and the distribution companies: KEW Media Distribution and TCB Media

Rights.

With primary offices in London, Los Angeles, New York, Sydney and Toronto, the KEW MEDIA GROUP

companies develop, produce and distribute more than 2,000 new hours of content every year, as well as manage a

library of more than 14,000 hours of content, for almost every available viewing platform worldwide. KEW aspires

to offer great content from all over the world to viewers of all ages and tastes. KEW promotes transparency,

equality, respect, and inclusiveness and plans to grow with the benefit of people from a wide range of perspectives

and backgrounds.

Forward-Looking Statements

This news release may include forward-looking statements. All such statements constitute forward looking

information within the meaning of securities law and are made pursuant to the “safe harbour” provisions of

applicable securities laws. Forward-looking statements may include, but are not limited to, statements about

anticipated future events or results including comments with respect to the Company’s objectives and priorities for

2019 and beyond, and strategies or further actions with respect to the Company, its business operations, financial

performance and condition. Forward-looking statements are statements that are predictive in nature, depend upon

or refer to future events or conditions and are identified by words such as “will”, “expects”, “anticipates”,

“intends”, “plans”, “believes”, “estimates” or similar expressions concerning matters that are not historical facts.

Such statements are based on current expectations of the Company’s management and inherently involve numerous

risks and uncertainties, known and unknown, including economic factors.

In particular, the statements set out in the Outlook section of this press release regarding our expected Adjusted

EBITDA for the year ending December 31, 2019, our expected financial performance for the remainder of 2019 and

our expectations regarding the performance of our production and distribution segments for the remainder of 2019,

constitute forward-looking statements. These statements are based on management’s current strategies,

assumptions concerning growth and assessment of the outlook for the business. In particular, such statements

assume that: (i) our production companies will continue to develop, produce and deliver successful productions in a

manner consistent with past experience and on expected delivery schedules as outlined under “Outlook” in the

press release; (ii) the product mix of the Company’s revenues will continue to be skewed towards higher margin

titles; (iii) we will continue to acquire and distribute content in a manner consistent with past experience; (iv) our

operating and overhead costs will be within budget; and (v) that the companies we have acquired will meet or

exceed our performance expectations. We consider the foregoing assumptions to be reasonable in the circumstances

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given the time period for such outlook. However, readers are cautioned that KEW’s actual results may vary from

these forward-looking statements and that variation could be material. The forward-looking information contained

in this news release is presented for the purpose of assisting readers in understanding the Company’s business and

strategic priorities and objectives as at the periods indicated and may not be appropriate for other purposes. A

number of risks, uncertainties and other factors may cause actual results to differ materially from the forward-

looking statements contained in this news release, including, among other factors, those referenced in the section

entitled “Risk Factors” in the Company’s annual information form for the year ended December 31, 2018, a copy

of which is available on the SEDAR website at www.sedar.com under the Company’s profile. In particular, KEW’s

results of operations fluctuate significantly quarter to quarter depending on the number and timing of content

delivered or made available to various media. As in past years, KEW anticipates that its 2019 financial results will

be heavily weighted in the fourth quarter and as a result, KEW may not have visibility on its ability to meet the 2019

guidance until the end of the fourth quarter of 2019.

Forward-looking statements contained in this news release are not guarantees of future performance and, while

forward-looking statements are based on certain assumptions that the Company considers reasonable, actual events

and results could differ materially from those expressed or implied by forward-looking statements. Readers are

cautioned to consider these and other factors carefully when making decisions with respect to the Company and not

place undue reliance on forward-looking statements. Circumstances affecting the Company may change rapidly.

Except as may be expressly required by applicable law, KEW does not undertake any obligation to update publicly

or revise any such forward-looking statements, and as a result of new information, future events or otherwise.

Non-IFRS Measures

This news release contains references to certain measures that do not have a standardized meaning under

International Financial Reporting Standards (“IFRS”) as prescribed by the International Accounting Standards

Board and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these

measures are provided as additional information to complement IFRS measures by providing a further

understanding of operations from management’s perspective. Accordingly, non-IFRS measures should not be

considered in isolation nor as a substitute for analysis of financial information reported under IFRS. This news

release makes reference to Gross Profit, Gross Profit Margin, Adjusted Net Income, Adjusted EBITDA, Free Cash

Flow, Net debt, and Adjusted Net Debt, each of which is a non-IFRS financial measure. The Company believes these

non-IFRS financial measures are frequently used by securities analysts, investors and other interested parties as

measures of financial performance and it is therefore helpful to provide supplemental measures of operating

performance and thus highlight trends that may not otherwise be apparent when relying solely on IFRS financial

measures.

The Company’s definitions of non-IFRS financial measures are as follows:

• Gross Profit is revenue less cost of sales.

• Gross Profit Margin is gross profit as a percentage of revenue.

• Adjusted Net Income is Income (Loss) before income tax recovery then includes add-back adjustments for

items such as transaction costs, reorganization and exceptional costs, share-based compensation, deferred

compensation, other intangibles amortization, gain on change in fair value of financial liabilities, and

(gain) loss on sale of subsidiary.

• Adjusted EBITDA is also provided to better analyze trends in performance and present a truer economic

representation on a comparative basis. Adjusted EBITDA is Adjusted Net Income including additional add-

back adjustments for Interest Expense, net of Interest Income, Depreciation and any non-cash amortization

(to the extent not added back to Adjusted Net Income).

• Free Cash Flow is Adjusted EBITDA adjusted for additions to Property and Equipment, Interest and cash

taxes.

• Adjusted Free Cash Flow is Free Cash Flow adjusted for additions to film and television rights, net of

amortization.

• Adjusted Net Income after tax is adjusted net income less income tax recovery.

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• Adjusted Net Debt is Net Debt less intra-group interim production financing and adjusted for the impact of

foreign exchange

• Adjusted Earnings Per Share is Adjusted Net Income divided by weighted average number of common

shares in the capital of the Company

Please see the Company’s management’s discussion and analysis for the three and six months ended June 30, 2019

for a detailed description of these measures and a reconciliation of these measures to the nearest IFRS measure.

Source: KEW MEDIA GROUP INC.

Investor Relations Contact:

Steven Silver

Chief Executive Officer

647-957-2194

investors@kewmedia.com

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Selected Comparative Information

Below is selected information from the consolidated statements of loss for the three and six months ended June 30,

2019 and the three and six months ended June 30, 2018.

Three months

ended June 30,

2019

Three months

ended June 30,

2018

Six months

ended June 30,

2019

Six months

ended June 30,

2018

Revenue

Production and distribution revenue 69,087 49,769 121,088 89,551

Cost of sales 47,801 36,364 85,796 63,346

Gross profit(1) 21,286 13,405 35,292 26,205

Expenses

General and administrative expenses 13,608 11,585 27,664 22,129

Amortization of other intangible assets 2,158 2,169 4,315 4,337

Amortization of right-of-use asset 1,404 — 2,726 —

Transaction costs — 1,828 — 2,760

Deferred compensation 1,075 1,703 1,977 1,703

Share-based compensation 455 553 1,378 598

Interest expense, net of interest income 2,254 1,355 4,755 2,513

Depreciation 503 209 878 399

Gain on change in fair value of financial liabilities (205 ) (1,253 ) (171 ) (3,150 )

Foreign exchange gain on financial liabilities (32 ) (600 ) (71 ) (149 )

Total expenses 21,220 17,549 43,451 31,140

Income (loss) before income tax recovery 66 (4,144 ) (8,159 ) (4,935 )

Income tax recovery (expense) 90 (845 ) 431 (233 )

Net income (loss) for the period 156 (4,989 ) (7,728 ) (5,168 )

Net income (loss) attributable to:

Equity holders of the parent (478 ) (5,339 ) (9,040 ) (6,029 )

Non-controlling interest 634 350 1,312 861

Net income (loss) for the period 156 (4,989 ) (7,728 ) (5,168 )

Loss per share attributable to equity holders of the parent:

Basic and diluted loss per share (0.03 ) (0.45 ) (0.66 ) (0.51 )

Weighted average number of Common Shares outstanding

– basic and diluted 13,761,152

11,825.913

13,761,152

11,821.228

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Three months

ended June 30,

2019

Three months

ended June 30,

2018

Six months

ended June 30,

2019

Six months

ended June 30,

2018

Calculation of Adjusted net income (loss) (1) and Adjusted

EBITDA: (1)

Income (loss) before income tax recovery 66 (4,144 ) (8,159 ) (4,935 )

Amortization of other intangible assets 2,158 2,169 4,315 4,337

Transaction costs — 1,828 — 2,760

Deferred compensation 1,075 1,703 1,977 1,703

Share-based compensation 455 553 1,378 598

Gain on change in fair value of financial liabilities (205 ) (1,253 ) (171 ) (3,150 )

Foreign exchange on financial liabilities (32 ) (600 ) (71 ) (149 )

Corporate reorganization costs (2) — — — 315

Exceptional costs (2) 1,271 1,241 1,935 1,878

Adjusted net income for the period 4,788 1,497 1,204 3,357

Depreciation 503 209 878 399

Amortization of right-of-use asset (3) 1,404 — 2,726 —

Interest expense, net of interest income, on long-term borrowings 1,799

1,355

3,974

2,513

Interest expense on lease obligations (3) 455 — 781 —

Adjusted EBITDA before NCI 8,949 3,061 9,563 6,269

Non-controlling interest (1,188 ) (410 ) (1,948 ) (1,143 )

Adjusted EBITDA after NCI 7,761 2,651 7,615 5,126

(1) Refer to the “Use of Non-IFRS Financial Measures” section of the MD&A.

(2) Included in general and administrative expenses.

(3) On January 1, 2019, Kew adopted IFRS 16, Leases. No adjustment was made to the six-month period ended June 30, 2018. The amounts

reflected in the three and six months ended June 30, 2019 reflect the relevant changes under the standard. As noted in the interim

condensed consolidated financial statements, payments made under lease obligations for the three and six month period ended June 30,

2019 were $1,212 and $2,397 respectively and having factored in the impact of NCI were $1,000 and $1,961 respectively.

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Revenue, Cost of Sales, Gross Profit and Segmental Analysis

Three months

ended June 30,

2019

Three months

ended June 30,

2018

Six months

ended June 30,

2019

Six months ended

June 30, 2018

Revenue

Production and distribution revenue 69,087 49,769 121,088 89,551

Cost of sales 47,801 36,364 85,796 63,346

Gross profit(1) 21,286 13,405 35,292 26,205

The Company’s business activities are conducted through two segments: Production and Distribution

Three months ended June 30, 2019 Six months ended June 30, 2019

Production Distribution Corporate Consolidated Production Distribution Corporate Consolidated

Revenues 46,025 23,062 — 69,087 79,567 41,521 — 121,088

Cost of sales 34,375 13,426 — 47,801 58,889 26,907 — 85,796

Gross profit(1) 11,650 9,636 — 21,286 20,678 14,614 — 35,292

General and administrative expenses 6,250

4,808

2,550

13,608

13,493

9,309

4,862

27,664

Segment profit (loss) 5,400 4,828 (2,550 ) 7,678 7,185 5,305 (4,862 ) 7,628

Exceptionals 90 91 1,090 1,271 90 159 1,686 1,935

NCI (1,188 ) — — (1,188 ) (1,948 ) — — (1,948 )

Adjusted EBITDA(1) 4,302 4,919 (1,460 ) 7,761 5,327 5,464 (3,176 ) 7,615

Three months ended June 30, 2018 Six months ended June 30, 2018

Production Distribution Corporate Consolidated Production Distribution Corporate Consolidated

Revenues 37,400 12,369 — 49,769 61,879 27,672 — 89,551

Cost of sales 29,444 6,920 — 36,364 47,439 15,907 — 63,346

Gross profit(1) 7,956 5,449 — 13,405 14,440 11,765 — 26,205

General and administrative expenses 4,916

4,338

2,331

11,585

10,138

7,738

4,253

22,129

Segment profit (loss) 3,040 1,111 (2,331 ) 1,820 4,302 4,027 (4,253 ) 4,076

Exceptionals — 158 1,083 1,241 315 158 1,720 2,193

NCI (410 ) — — (410 ) (1,143 ) — — (1,143 )

Adjusted EBITDA(1) 2,630 1,269 (1,248 ) 2,651 3,474 4,185 (2,533 ) 5,126 (1) Refer to the “Use of Non-IFRS Financial Measures” section of the MD&A

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Adjusted EBITDA and Free Cash Flow (FCF)

Three months ended June 30,

2019

Three months ended June 30,

2018

Six months ended June 30,

2019 Six months ended

June 30, 2018

Adjusted EBITDA after NCI 7,761 2,651 7,615 5,126

Additions to property and equipment (868 ) (307 ) (1,240 ) (523 )

Interest expense (2,254 ) (1,355 ) (4,755 ) (2,513 )

Cash taxes — — — —

FCF before movements in working capital and before movements in film and television rights 4,639

989

1,620

2,090

Net change in non cash working capital balance related to operations (6,876 ) (5,585 ) 2,306

(8,751 )

FCF after movements in working capital and before movements in film and television rights (2,237 ) (4,596 ) 3,926

(6,661 )

Net deductions (additions) to film and television rights 3,148 (4,112 ) (4,986 ) (4,233 )

FCF 911 (8,708 ) (1,060 ) (10,894 )

Segmental FCF

Three months ended June 30, 2019 Six months ended June 30, 2019

Production Distribution Corporate Consolidated Production Distribution Corporate Consolidated

Adjusted EBITDA after NCI 4,302

4,919

(1,460 ) 7,761

5,327

5,464

(3,176 ) 7,615

Additions to property and equipment (849 ) (18 ) (1 ) (868 ) (1,154 ) (64 ) (22 ) (1,240 )

Interest expense (356 ) (358 ) (1,540 ) (2,254 ) (479 ) (387 ) (3,889 ) (4,755 )

Cash taxes — — — — — — — —

FCF before movements in working capital and before movements in film and television rights 3,097

4,543

(3,001 ) 4,639

3,694

5,013

(7,087 ) 1,620

Net change in non cash working capital balance related to operations (5,180 ) (3,479 ) 1,783

(6,876 ) (421 ) (77 ) 2,804

2,306

FCF after movements in working capital and before movements in film and television rights (2,083 ) 1,064

(1,218 ) (2,237 ) 3,273

4,936

(4,283 ) 3,926

Net deductions (additions) to film and television rights 2,844

304

—

3,148

(3,588 ) (1,398 ) —

(4,986 )

FCF 761 1,368 (1,218 ) 911 (315 ) 3,538 (4,283 ) (1,060 )

12

Earnings per share (EPS) and Adjusted EPS

Three months

ended June 30,

2019

Three months

ended June 30,

2018

Six months

ended June 30,

2019

Six months

ended June 30,

2018

Adjusted EBITDA after NCI 7,761 2,651 7,615 5,126

Interest expense on long term borrowings (1,799 ) (1,355 ) (3,974 ) (2,513 )

Tax recovery (expense) 90 (845 ) 431 (233 )

Non-controlling interest from EBITDA 1,188 410 1,948 1,143

Adjusted net income after tax 7,240 861 6,020 3,523

Adjusted EPS- basic and diluted 0.53 0.07 0.44 0.30

Exceptional costs (1,271 ) (1,241 ) (1,935 ) (1,878 )

Corporate restructuring costs — — — (315 )

Transaction costs — (1,828 ) — (2,760 )

Stock-based compensation (455 ) (553 ) (1,378 ) (598 )

Deferred compensation costs (1,075 ) (1,703 ) (1,977 ) (1,703 )

Amortization of other intangible assets (2,158 ) (2,169 ) (4,315 ) (4,337 )

Gain on change in fair value of financial liabilities 205 1,253 171 3,150

Gain on FX translation of financial liabilities 32 600 71 149

Net income (loss) 156 (4,989 ) (7,728 ) (5,168 )

Basic EPS- basic and diluted (0.03 ) (0.45) (0.66 ) (0.51)