MEDIASET GROUP. IR Roadshow Presentation. December

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1 MEDIASET GROUP IR Roadshow Presentation December

2 Italian Advertising Market Structural and Long Term Factor

3 Structural and Long-term Factors Total Advertising as a % of GDP 1,6 1,4 1,2 USA 1 0,8 0,6 UK GERMANY SPAIN FRANCE ITALY 0, Source Advertising Expediture - December

4 Structural and Long-term Factors ADEX TREND (in mio Euro) Total Market GERMANY FRANCE UK ITALY SPAIN Source: AcNielsen (It, Ger, UK), Info Adex (SP), Taylor Nelson Sofres (Fr) 4

5 Structural and Long-term Factors ADEX TREND (in mio Euro) TV Market GERMANY UK FRANCE ITALY SPAIN Source: AcNielsen (It, Ger, UK), Info Adex (SP), Taylor Nelson Sofres (Fr) 5

6 Structural and Long-term Factors How Italy can narrow its advertising gap with UK UK Ad-spend Nominal GDP = 1.1% UK Total Adv. Market Italian Total Adv. Market Deregulation Industry Consolidation ITA Ad-spend = 0.64% Nominal GDP

7 Structural and Long-term Factors 2001 Media Share on Total Advertising TV accounts for more than 53% of the Italian advertising industry TV weighting in the industry is the highest in Europe Pay-TV is still struggling Satellite penetretion is below 20% Italy *Germany U.K. France Spain TV Print Other Source Nielsen /MMS/Secodip/Infoadex net estimates 2001 *cinema not monitored 7

8 Structural and Long-term Factors Tv Consumption (minutes per day) Source: Auditel; Target Individuals

9 Structural and Long-term Factors Reach and Quantitative Coverage in Adults (,000) 39,419 33,174 Reach on Adults (%) , , , TV RADIO WEEKLIES MONTHLIES NEWSPAPERS Source Auditel Autumn Audipress 99 (last published survey) Audiradio 2001; Target Adults: 49,370,600 9

10 Structural and Long-term Factors Quantitative Coverage in Adults (,000) CANALE 5 30,011 RADIO DJ 5,075 SORRISI E CANZONI TV 7,928 QUATTRORUOTE CORRIERE DELLA SERA 5,147 2,738 TV RADIO WEEKLIES MONTHLIES NEWSPAPERS Source Auditel Autumn Audipress 99 (last published survey) Audiradio 2001; Target Adults : 49,370,600 10

11 Structural and Long-term Factors TV Cost per Thousand, European Comparison ITALY GERMANY FRANCE SPAIN U.K Index Source: (MediaEdge) 2002 Global Media Cost Comparison 11

12 Structural and Long-term Factors TV Cost per Thousand, Italian Comparison TV (24h) Radio (24h) Newspaper Magazines Cinema Index Source: (MediaEdge) 2002 Global Media Cost Comparison 12

13 Mediaset Group Advertising

14 Publitalia TV Advertising Revenues Quarterly Growth Trend % on Total 2001 Revenues 2000 vs vs vs Q 29.2% +17.5% +6.0% -3.7% 2 Q 29.6% +12.8% +2.7% -2.2% 3 Q 15,3% +13.6% -1.4% +1.7% 4 Q 25.9% +6.1% -7.8% 14 advertising

15 Mediaset: Buying Behaviour of Main Macro Sectors % on Total Revenues 4,4 6,1 6,8 7,8 13,6 19,2 16,7 48,3 48,1 48,6 48,7 45,6 42,7 44,0 7,4 7,9 7,9 8 7,6 7,3 8,5 39,9 37,9 36,7 35,5 33,3 30,8 30, Others Automotive Grocery Developing sectors Source Publitalia advertising

16 Mediaset: Advertising Investments by Sector (%) No Food 18.2% 9M 2002 Automotive 9.6% Food 32.8% Others 17.3% Media 7.4% Telecom 7.6% Pharma 4.0% Finance 3.1% No Food 15.6% Automotive 10.3% Food 33.1% Others 17.0% 9M 2001 Media 8.3% Telecom 9.1% Pharma 3.2% Finance 3.4% 16 advertising

17 Mediaset: M Advertising Investments Performance by Sector Vs Vs FOOD NO FOOD AUTOMOTIVE AUTOMOTIVE (excl.fiat) TELECOM FINANCE/INSURANCE PHARMACEUTICAL -2.9% +14.0% -9.1% -5.0% -17.7% -12.7% +21.2% +7.2% +13.4% +10.8% +18.6% -35.1% +21.8% +17.5% 17 advertising

18 Mediaset: M Advertising Investments Last Hints on Some Sectors AUTOMOTIVE AUTOMOTIVE (excl. FIAT) TELECOM FOOD NO FOOD Cosmetics Housekeeping Product Toiletries October +58.3% +68.4% +10.5% +2.0% -5.6% +31.2% -16.5% -6.0% 10M % +2.8% -14.2% -2.4% +12.0% +22.1% +4.4% +14.3% 18 advertising

19 MEDIASET GROUP Broadcasting

20 Mediaset Leader in Free-to-Air Commercial TV Others Canale 5 Italia1 Rete4 RAI 1 RAI2 RAI3 CHANNELS All News Channel Local Channels Satellite Cable Source: Mediaset, Auditel (24 hours) 2001 AUDIENCE (Commercial target 15-54) 46.9% 42.1% 2.2% 8.8% 20 broadcasting

21 Editorial Strategy Three Channels, One Television ITALIA 1 RAI 2 LA7 Female Male CANALE 5 RAI 3 TOT. AUDIENCE RETE 4 RAI 1 Young Adults 21 broadcasting

22 2002 9M Audience Share 24 HOURS PRIME TIME DAY TIME 43.1% 43.8% 42.7% 46.5% 45.8% 46.6% 22 Source: Auditel Individuals broadcasting

23 2002 9M Audience Share Mediaset very close to RAI in Prime Time Prime Time 49.5% 49.2% 47.6% 45.8% 7.9% 2.0% 41.6% 42.2% 43.1% 43.8% M 2002 Source: Mediaset, Auditel Individuals 23 broadcasting

24 MEDIASET GROUP Financial Highlights

25 Mediaset Group 2001 Full Year Results (m ) Net Consolidated Revenues 2, , ,048.7 Operating Costs (1,030.6) (1,006.4) (875.7) EBITDA 1, , ,173.1 Amortization and Depreciation (733.3) (665.7) (612.9) EBIT Pre-tax Profit Net Profit financials

26 Mediaset Financial Overview 2001 Operations Overview (m ) Total Net Revenues Ebit Ebit Margin TV Operations 2, % MULTIMEDIA Operations n.a. NON TV Operations % Epsilon (1H2001 only) n.a. 2,290.4(*) % (*) excluding Sale of Rights 26 financials

27 Mediaset Financial Overview Focus on TV Operations (m ) Total Net TV Revenues Advertising (3rd parties) Other TV Revenues (*) Commissions 2, , (362.4) 2, , (353.1) 1, , (315.6) Total TV Costs Personnel Other operating costs Amort. & Depreciation Sale of Rights (1,590.9) (275.0) (658.4) (718,3) 60.8 (1,495.4) (280.5) (592.7) (651.6) 29.3 (1,401.5) (279.7) (521.3) (611.0) 10.5 EBIT from TV Operations margin 26.8% 31.2% 28.3% (*) excluding Sale of Rights 27 financials

28 Mediaset Financial Overview TV Operating Leverage Trend (m ) Total Net TV Revenues 1,793.4 Total TV Costs 1,312.9 EBIT from TV Operations % 1, % 1, % % +0.0% 2, , % +6.7% 1, , % -14.0% financials

29 Mediaset Financial Overview Focus on Multimedia Operations (m ) Total Multimedia Revenues Thematic Channels Teletext Internet Total Multimedia Costs (46.4) (26.6) (7.4) Personnel (5.3) (2.9) (1.6) Other Operating Costs (31.3) (18.6) (4.7) Amort. & Depreciation (9.7) (5.0) (1.1) EBIT from Multimedia Op. (9.3) financials

30 Mediaset Group Associated Company, Net Financial Income (Charges), Extraordinaries (m ) TELECINCO (40% stake) ALBACOM (19.5% stake) Kirch Media (2.28% stake) Others TOTAL Associates (34.1) (171.9) (2.4) (183.7) (25.8) - (5.8) 10.0 Net Financial Income/ (Charges) (14.8) (52.4) Total Extraordinary Items 29.4 (1.1) 30 financials

31 Mediaset Group Cash flow Statements (m ) Net Financial Position 1/1 Free Cash flow Cash flow from operations Investments Others movements Dividends Equity movements Change in Consolidation Area Net financial Position 31/ (297.6) 1,162.3 (1,279.1) (180.8) (283.2) (247.8) ,146.6 (806.1) (177.2) (216.2) (12.4) (1,384.9) (167.1) Total Net Cash Flow (373.1) (50.2) (177.4) financials

32 Mediaset Financial Overview Investments (m ) 2001 = 1, = (*) Associates TV Rights Technical & Immaterial 9,617 Titles, 53,886 Episodes 8,978 Titles, 51,009 Episodes (*) of which m coming from the unwinding of Epsilon 32 financials

33 Core Business International TV Business

34 Telecinco: Audience Share Leader in Commercial Target others32.3% 25.0% others 34.1% 23.9% 19.7% 23.0% 19.9% 22.1% 34 broadcasting

35 Telecinco Spanish TV Advertising Market (m ) 2000 = 2, = 2, % 14.6% 28.9% 1.3% 14.6% 28.4% 21.6% 23.2% 5.8% 27.8% 5.8% 26.6% Source: Adex Nielsen, Publiespana 35 advertising

36 Telecinco Consolidated Financial Results (m ) Net Revenues Operating Costs (378.1) (368.6) (350.5) EBIT Pre-tax Profit Net Profit financials

37 MEDIASET GROUP Focus on Core Business Profitability, Assessing Any Growth Opportunity

38 Focus on Core Business Profitability Ebit Margin (ROS)(*) 27.0% 26.8% 28.4% 31.2% 26.8% FCF (ml )(*) FCF/ Revenues (*) 8.1% 8.4% 19.6% 13.0% 8.6% Net Profit (ml ) (**) EPS ( ) (**) Dividend (ml ) Pay-out ratio 58.4% 58.7% 63.7% 67.0% 67.0%(**) Debt/ Equity n.a. n.a. n.a. n.a. 10.5% (*) TV Operations (for FCF: excluding Associates Investments) (**) excluding Kirch Media extraordinary provisions 38 financials

39 Assessing All the Growth Opportunities TECHNICAL GEOGRAPHICAL EXPANSION 3G mobile Mobile interactivity BroadBand DTT Rights Trading PubliEurope Tele5 stake increase German MRKT (?) Radio Full Rights Exploitation Local Advertising Fiction re-sale ADV Other Means Merchandising and Brand Extension REGULATORY FRAMEWORK VALUE CHAIN IN ITALY 39 Mediaset Group

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