Sky Deutschland 2012 full-year results: EBITDA improved by €104m year-on-year

Delivering strong growth across all categories
• EBITDA: up +€104.4m to negative €51.1m
• Revenues: up 17% to €1,333.2m
• Annual ARPU: up €1.44 to €31.90
• Total customers: up 351,000 to 3,363,000 (+12%)
• Sky Premium HD customers: up 540,000 to 1,514,000 (+56%)
• Sky+ customers: up 518,000 to 929,000 (+126%)
• Second smartcard customers: up 172,000 to 346,000 (+98%)
• Sky Go customer sessions: up 25.7m to 33.3m (+335%)

Major strategic landmarks achieved
• All relevant football rights secured, including exclusive live Bundesliga on all platforms
• Key Hollywood studio contracts extended and expanded
• Cooperation agreements with all major cable companies and Deutsche Telekom
• Enhanced features and extended content on Sky Go and Sky Anytime
• Significant expansion of HD, including launch of Sky Atlantic HD
• Record viewership and satisfaction levels
• Multiple service and product awards for delivering outstanding service
• New financing structure provides increased flexibility

Confirming outlook
• Full year 2013 EBITDA expected to be positive, and to grow strongly thereafter

Brian Sullivan, CEO of Sky Deutschland: “In 2012 we delivered a strong performance driven by our sustained customer focus and the expanding depth and breadth of our offering. We have seen an excellent response to our innovative services like Sky Go and Sky Anytime which increase customer satisfaction and loyalty and provide opportunities for further growth. Looking ahead, 2013 will be a great year on-screen with more blockbuster movies and TV-series, an unrivalled selection of live sport including the Bundesliga, as well as many exciting innovations. Customers will have more ways to access our high-quality exclusive programming and more reasons to join and stay with Sky.”

Unterföhring, 28 February 2013  –  2012 was an excellent year for Sky Deutschland as the business attracted a growing number of viewers to its expanding program line-up, maintained its leadership in innovation and further enhanced its customer service. This delivered a strong operational and financial performance: EBITDA improved by €104.4 million in 2012 to negative €51.1 million (2011: negative €155.5 million). Total revenues rose by 17% to €1,333.2 million (2011: €1,138.7 million). Sky’s customer base grew significantly by 351,000 to 3,363,000 at year’s end (+12%). The annual average revenue per customer (ARPU) climbed by €1.44 to €31.90. While markedly enhancing the product and service offering, Sky kept a focus on tight cost control. As a result total costs excluding depreciation increased to just €1,384.3 million (2011: €1,294.2 million), absorbing the impact of a full year of Sky Sport News HD, the launch of Sky Atlantic HD, and the expansion of Sky’s HD line-up.

Significant strategic landmarks achieved
In 2012, Sky reached a number of key milestones. Comprehensive marketing and distribution agreements with all the major German cable operators including Unitymedia, Kabel BW and Kabel Deutschland as well as a partnership with Deutsche Telekom, extend the availability of Sky’s entertainment line-up to a growing number of households. In securing the enhanced and exclusive live Bundesliga rights for the 2013/14 to 2016/17 seasons in April 2012, Sky completed contract renewals for all leading football competitions, including the UEFA Champions League, the UEFA Europa League, the DFB-Pokal and the Austrian Bundesliga. Over the course of 2012, Sky also strengthened its movie and entertainment line-up with the extension and expansion of exclusive content agreements with major Hollywood studios and other important rights holders including Sony Pictures Television, NBC Universal Studios Networks, Warner Brothers, Constantin Film, Tele München, Splendid, Telepool, Tobis, ZDF Enterprises and Discovery Networks. The new financing structure announced on 14 January 2013 gives Sky a unique long-term perspective with greater opportunities in a growing market for premium pay-TV.

Key innovation achievements
Sky also strengthened its innovation leadership with the expansion of Sky Go. The service’s appeal is reflected in the growing number of customer sessions, which rose by 335% in 2012 to 33.3 million. With an exclusive selection of new blockbuster movies and top series, all accessible on-demand and available before other services, in addition to the availability of all of Sky’s exclusive live sport HD channels, Sky Go is the leading over-the-top (OTT) pay-TV service in Germany and Austria. Sky continues to further develop Sky Go. Only last week the service’s intuitive and innovative Sky Guide was enhanced with new features including a remote programming capability enabling customers to program their Sky+ HD receiver from the iPad, the iPhone and iPod touch as well as from the web. 2012 also saw the number of Sky+ customers increase by 126% to 929,000 (2011: 411,000), doubling penetration in Sky households to 28%. Sky Anytime, the on-demand service available via Sky+, also expanded over the course of 2012 with the addition of a permanent selection of blockbuster movies, latest hit series, exciting documentaries and selected children’s programming.

Sky also grew its HD portfolio from 42 channels at the beginning of the year to 64 HD channels as of today. Sky Premium HD – the leading offering in Germany and Austria – continued to drive customer and revenue growth with the number of Sky Premium HD customers increasing 56% to 1,514,000, meaning that 45% of all Sky households now take Sky’s leading premium HD offering. The launch of Sky Atlantic HD in May 2012 was a highlight for customers as the new channel exclusively offers outstanding series and productions from HBO, the most critically acclaimed premium channel in the US.

As a growing number of households look to enjoy Sky’s entertainment line-up in different rooms at the same time, the number of Sky Zweitkarte (second smartcard) customers also continued to grow, nearly doubling year-on-year to 346,000 (2011: 175,000). The increasing appeal of Sky’s exclusive high-quality entertainment is also reflected in record audience and satisfaction levels.

Key customer service achievements
Sky’s quality service offering received multiple awards in 2012. The TÜV awarded Sky their official seal of approval, while Focus-Money rated Sky as “fairest Premium-TV provider”. In addition, when judged against all Premium TV providers in Germany, Sky was recognized as the service leader in its category. In order to strengthen its award winning customer service, Sky created up to 170 new jobs at its service centers.

Contact for media:     
Dr. Jörg E. Allgäuer    
Vice President Corporate Communications 
Tel.: +49 89/99 58-63 77     

Contact for investors and analysts:
Christine Scheil
Vice President Investor Relations
Tel.: +49 89/99 58-10 10
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