De Agostini

In 2009, the Media & Communication business reported a drop in income compared with 2008. Key financial and operating performance indicators for the business are shown in the table below.

Revenues

Total revenues generated by Media & Communication in 2009 were around EUR 560 million, an increase of EUR 38 million versus the previous year, taking into account changes in the basis of consolidation.

The largest contribution to the revenues of the Media & Communication business comes from Zodiak Entertainment (which includes the content production activities of Marathon, Magnolia e Zodiak TV), accounting for around 66% of the sector’s total revenues. The remaining 34% is generated by Antena 3 (accounting for around 29%), and Mikado and DeA Planeta (together accounting for 5%).

An overview of the performance of the subsidiaries in the Media & Communication business is provided below. The comments are based on the relevant financial and performance indicators on a 100% basis.

Zodiak Entertainment – Content production

The Zodiak Entertainment Group, established in November 2008 following the acquisition of Magnolia (Italy), Marathon (France) and Zodiak TV (Sweden), completed the process of integrating the different companies in 2009 and set up an autonomous distribution operation.

At the end of 2009, the group was operating in 14 European countries (with a strong presence in Italy and France), as well as in Russia, the US and India, where it operates through its subsidiary Sol Productions Priv Ltd.

In 2009, the group reported revenues of around EUR 372 million, up on 2008.

The largest component of income was represented by the production of non-scripted programmes (61% of total revenues), followed by scripted programme production (29%), with distribution activities making up the remaining 10%.

The group was able to limit the negative impact of the economic slowdown thanks to its broad portfolio of products and the production and distribution of the Millennium Trilogy by Stieg Larsson (“The Girl with the Dragon Tattoo”, “The Girl Who Played with Fire” and “The Girl Who Kicked the Hornets’ Nest”, which have enjoyed worldwide success).

Other programmes produced by the group in 2009 in various countries include “L’Isola dei Famosi”, “X Factor”, “Supervivientes”, “Paradise Hotel” and “Le Grand Journal”.

Antena 3 – TV and radio

In 2009, Antena 3 recorded total net revenues of around EUR 704 million, down from EUR 833 million in 2008.

In the TV business, revenues totalled EUR 593 million, a decline of 17% on the previous year, mainly due to the considerable contraction in the Spanish TV advertising market, which saw a drop of 23% during the year, and more intense competition in the sector.

Antena 3 still managed to increase its advertising market share to 26% during the year, despite a 0.3% drop in total audience share versus 2008 to 16.6%, demonstrating greater efficiency than the sector average in the use of advertising space. This efficiency was built on the success of the digital channels (with a 0.9% increase in audience share in 2009 versus 2008) and the implementation of a policy of bundling advertising services. The company’s power ratio (the ratio of advertising share to audience share) in 2009 thus strengthened further to 1.57.

As a result of these trends, advertising revenues (including TV) declined to around EUR 555 million in 2009 (-16% versus 2008). Despite the slight decrease in audience share, adding all its channels together the company continues to rank second in terms of its share of the total audience and in its key target market.

The radio business (Onda Cero, Europa FM and Onda Melodia) generated revenues of EUR 84 million, a slight decline (7%) on 2008; listening figures, however, confirmed the success of these radio stations (3.3 million listeners, an increase of 10.6% on the previous year).

DeA Planeta – Film production and distribution – Spain

Following on from the restructuring measures implemented in 2008, the company improved its level of profitability, outsourcing some of its home video activities.

In the wake of these measures, which were completed successfully, DeA Planeta turned its attention to TV and film distribution, and in 2009 it achieved good results, reporting revenues of around EUR 15 million, a slight increase on 2008. In the film business, in particular, results were boosted by the performance of the film “Planet 51”.

EBITDA/EBIT

EBITDA in 2009 came in at around EUR 81 million, a decrease of EUR 104 million compared with 2008. This drop is largely due to the widespread reduction in profitability caused by the economic crisis that has hit the sector, and the impact of these developments can also be seen at EBIT level.

Net profit (loss)

In 2009, the net loss attributable to the group was EUR 8 million, as a result of the operating performance described above and financial charges and taxes of EUR 18.6 million. This result represents an improvement on the net loss of EUR 12 million attributable to the group in 2008.