ADRIA BIDCO Q1 2014 Financial Results Presentation 26 June 2014 - PowerPoint PPT Presentation

ADRIA BIDCO Q1 2014 Financial Results Presentation 26 June 2014

Disclosure Regarding Forward-Looking Statements This presentation includes forward-looking statements. Forward-looking statements can be identified by the use of forward-looking terminology, including words such as “believes,” “estimates,” “anticipates,” “expects,” “intends,” “may,” “will”, “could” or “should” or, in each case, their negative or other variations thereof or comparable terminology. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this presentation and include statements regarding, or based upon, our Management’s current intentions, beliefs or expectations concerning, among other things, our future results of operations, financial condition, liquidity, prospects, growth, strategies, potential acquisitions, or developments in the industry in which we operate. Forward-looking statements are based upon assumptions and estimates about future events or circumstances, and are subject to risks and uncertainties. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that these expectations will materialize. Accordingly, our actual results may differ materially from those expressed or implied thereby. Unless otherwise specified, forward-looking statements herein speak only as of the date of this presentation. We undertake no obligation, and do not intend, to publicly update or revise any forward- looking statements, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the cautionary statements referred to above. Readers are cautioned not to place undue reliance on any forward-looking statements. 2

Agenda Introduction Q1 2014 Highlights Operational Review Financial Review Appendices 3

Introduction to Adria Bidco South-East Europe’s leading provider of pay-TV and  broadband services 2020 Senior Notes Issuer Adria Bidco B.V.  1.9 million cable and satellite TV, broadband, fixed and mobile RGUs across the six countries of former Yugoslavia Listed GEM, Irish Stock Exchange  Operating in a market characterised by rapidly growing pay- Governing Law State of New York TV and broadband that is currently underpenetrated relative € 475 million Outstanding notes to other CEE and Western European markets Coupon 7.875%  Unmatched reach via cable and direct-to-home platforms Maturity 15 November 2020 across the region, and ethnically targeted over-the-top content platforms internationally Coupon dates 15 November & 15 May XS0992294388 (Reg. S) Reputation for providing the most attractive content in its  ISIN code XS0992293810 (144A) respective markets, available across all devices and formats  Group strategy leverages established proven strengths extensive network, – differentiated content offerings, and – loyal customer base – to further strengthen market leadership in the region and to target the region’s expat community with best in class local content delivered through the internet  Following successful acquisition of the Group in March 2014, Adria Bidco is now majority-owned by funds affiliated with KKR 4

Agenda Introduction Q1 2014 Highlights Operational Review Financial Review Appendices 5

Q1 2014 operational highlights Homes passed (m) 1.34  Homes passed up by 16% to 1.3 million vs. Q1 2013, primarily as a result of network expansion +16% 11k of new homes passed added during Q1 2014 − 1.16  RGUs up by 17% to 1.9 million since Q1 2013 driven by organic growth and acquisitions (Slovenia, Bosnia, and Net TV Plus) Q1 2013 Q1 2014 − Acquisitions completed in 2013 added c.174k RGUs RGUs (m) − 42k of RGUs added during Q1 2014 1.93  Number of unique cable subscribers up by 6% to 808k, vs. Q1 2013 +17% 1.65 Blended cable ARPU up by 4% year-on-year to € 17.3 driven by  migration from lower-priced to higher-priced service packages − growth in subscribers for the multi-play offering, and − Q1 2013 Q1 2014 price increases for triple-play packages − Blended cable ARPU ( € ) 17.3 +4% 16.7 6 Q1 2013 Q1 2014

Q1 2014 financial highlights Consolidated group revenues up 14% year-on-year to € 65.9m  SBB Serbia: € 31.8 million Revenues (EUR m) – Telemach Slovenia: € 20.3 million – 65.9 Telemach BH: € 5.4 million – +14% United Media Group: € 7.7 million – 57.8 EBITDA (excl. non-operating expenses) up 21% to € 32.2 million  Q1 2013 Q1 2014 CAPEX for Q1 2014 at € 22.3 million compared to the below  average CAPEX of € 12.2 million in Q1 2013 (FY 2013 CAPEX: € 81.3 million), driven by increased investments at SBB Serbia, Telemach Slovenia and Telemach Bosnia. EBITDA (Excluding non-operating expenses) (EUR m) EBITDA-CAPEX decreased from € 14.5 million in Q1 2013 to  32.2 € 9.9 million in Q1 2014 due to continued investment in our network. +21% 26.7 Net leverage in Q1 2014 of 4.00x, down from 4.22x at end-2013. *  Q1 2013 Q1 2014 * Annualised Last Two Quarters EBITDA (excl. non-operating expenses) is calculated by multiplying EBITDA for the two most recent quarters by two . 7

Agenda Introduction Q1 2014 Highlights Operational Review Financial Review Appendices 8

Network expansion during Q1 2014 driven by organic growth Homes passed across key markets Key developments Network expansion during Q1 2014 (v. Q4  '000 2013) driven solely by organic growth 853  Comparison against Q1 2013 affected by 731 acquisitions including: – United Media Production – Elektro Turnsek 298 243 184 191 Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 2014 SBB Serbia* Telemach Slovenia Telemach BH *Includes KDS and JET TV subscribers in Serbia 9

Increasing RGUs since year-end 2013 Key developments RGUs by service  Increasing RGUs during Q1 2014 '000  Comparison of the number of cable 801 759 pay-TV RGUs against Q4 2013 affected by reclassification of 7k B2B pay-TV subscribers in Slovenia 432 406 371 373 181  Comparison against Q1 2013 affected 122 +11% 44 64 - 21 by acquisitions Cable pay-TV DTH pay-TV IPTV Broadband Fixed Other internet telephony services Series2 Series1 Q1 2013 Q1 2014 Serbia Bosnia Slovenia 2% 2% 11% 1% 6% 39% 42% 21% 57% 28% 30% 34% 0% 0% 0% 0% 27% *Revenues from DTH pay-TV services for all six countries of operation reported under SBB Serbia 10

Continued growth in blended cable ARPU Key developments Blended cable ARPU per unique subscriber  Q1 2014 blended cable ARPU up 4% year-on-year to € 17.3 Blended cable ARPU per country ( € ) Blended cable ARPU ( € ) SBB Serbia -1% – Price increase implemented as of March 17.3 28.7 28.3 2014 +4% – Positive impact of promotional campaigns +3% +4% – Lower telephony traffic 16.7 13.8 14.4 13.3 12.9 Telemach Slovenia Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 2014 – Growth in subscribers for multi-play offering – Subscriber migration from lower-priced to SBB Serbia* Telemach Slo Telemach BH higher-priced service packages – Price increase for triple-play package – 7k B2B pay-TV subscribers in Slovenia were reclassified during the reporting period, SBB Serbia* Telemach Slovenia Telemach BH affecting ARPU levels in € Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 2014 Telemach BH Blended Cable 12.9 13.3 28.7 28.3 13.8 14.4 ARPU Growth in subscribers for multi-play offering – Higher telephony services revenues – *SBB includes KDS and JET TV subs in Serbia 11

Agenda Introduction Q1 2014 Highlights Operational Review Financial Review Appendices 12

Revenue development Key drivers Q1 2014 revenue development Group revenue up by 14% to € 65.9 million  vs. Q1 2013 due to organic growth, an Revenues (EUR m) overall increase in ARPU and acquisitions SBB Serbia 65.9 Revenue increased by 2% to € 31.8 million  +14% driven by subscriber base growth and migration to multi-play packages 57.8 − A price increase was implemented as of March 2014 which had a one month impact on the Q1 2014 results Q1 2013 Q1 2014 Telemach Slovenia Revenue up by 18% to € 20.3 million due  to: – continued subscriber migration to higher priced service packages +2% – increase in the number of multi-play 31.8 subscribers 31.2 – acquisitions +18% 20.3 Telemach BH 17.2 Revenue up by 22% to € 5.4 million due to  a mix of organic subscriber base growth +22% and acquisitions 5.4 4.5 United Media Group Generated revenues of € 7.7 million in line  SBB Serbia Telemach Slo Telemach BH with gradual subscriber base growth of the Q1 2013 Q1 2014 13 Group and overall market

EBITDA development Q1 2014 EBITDA by business EBITDA (Excluding non-operating expenses) (EUR m) segment 1.8 2.8 32,248 +21% 26,674 2.5 14.7 Q1 2013 Q1 2014 10.4  EBITDA (Excluding non-operating expenses) in Q1 2014 of € 32.2 million SBB Serbia Telemach Slo Telemach BH United Group Other Businesses * EBITDA is shown before IC eliminations 14