1

Production

In Transition Towards Strong Growth

Latin America

Germany

Russia

China

ItalySpain

UK

France

Hong Kong

US Hispanic Market

Netherlands

Colombia

HUASO

2

Production – FY09 Update

• Re-positioning the business towards growth in light entertainment

– Acquired 2waytraffic and in the process of integrating the two operations

• Expect to meet SPE financial budget targets, despite difficult market conditions and timing delays in operational performance

• New business models Advertiser Lead Programming (ALP) and mobile show promise

– Maintaining strong and very profitable position in French light entertainment; extending agreement with Starling’s CEO Franck Marty

– Investments in creative companies Tuvalu (Netherlands) and Gogglebox (U.K.) tracking to plan

– Assessing new light entertainment investments in Germany, Scandinavia and Poland

• Implementing turn-around plan and new operational principles for Lean-M in Russia

– Transition year with lower profits, but strong business fundamentals for future growth

– Negative financial impact exacerbated by change in accounting treatment (equity method)

– In negotiation with founders about a new partnership agreement

• Stepped-up investment in Shine-Reveille is tracking to plan

– Shine/SPTI co-production Last Van Helsing will be a lead ITV title in early 2009

A challenging year as the business repositions for growth

3

Production – FY09 Update

• Operational challenges in key European markets

– Germany’s demand for local fiction has not yet returned; significantly fewer than expected commissions (2 dramas and 2 sitcoms budgeted, but not sold)

• Diversification into light entertainment slower than expected

– Continued success with Dragon’s Den in the U.K., but difficult environment is obstacle for expansion of small market share; expanded digital strategy with 195 episodes of Sophia’s Diary on Bebo

– Restructuring of the business in Spain is taking longer than expected and hampered by difficult market conditions

– Activities in Italy solely focused on format licensing

• Latin America operations showing strong growth

– Evolving from format licensor to in-house co-executive producer• About to close investment in Colombian producer Teleset

– Emerging as recognized telenovela producer (Isa TKM for MTV Latin America, Amor Propio for Venevision)

• Change in senior management structure– Enhancing roles and responsibilities of regional and local management teams

4

318

249

0

50

100

150

200

250

300

350

FY09 Budget FY09 Forecast

($M

M)

Production – FY09 Update

Revenue EBIT

$-69MM

23.7

8.3

0

10

20

30

FY09 Budget FY09 Forecast

($M

M) $-15.4MM

EBIT shortfall predominantly due to Russia/Lean-M and Germany

5

Production – FY09 Update

EBIT Summary

(US$Millions) Budget Forecast Variance

2waytraffic 35.0 27.1 (7.9)2waytraffic Amortization (30.0) (22.1) 7.92waytraffic 5.0 5.0 0.0

France (SPTI + Starling) 9.7 10.8 1.1Russia (SPTI + Lean-M) 9.6 3.5 (6.2)Germany 3.1 (1.9) (5.0)UK (SPTI + Gogglebox + Shine) 1.9 1.6 (0.3)Netherlands (Tuvalu) 1.0 1.0 0.0Spain 0.7 (0.8) (1.4)Italy 0.7 0.1 (0.6)Europe 26.7 14.2 (12.5)

Latin America 3.7 3.3 (0.3)

Asia & India (1.4) (0.9) 0.5

Development (1.8) (1.8) 0.0HO Overhead (LA/London) (8.1) (9.3) (1.2)Allocations (3.1) (3.1) 0.0Other 2.7 0.9 (1.8)

TOTAL 23.7 8.3 (15.4)

6

Production – Key Strategic Goals

1. Expand light entertainment business globally

• Maximize 2waytraffic assets to establish SPTI as a premier destination for light entertainment formats

• Create synergies and ensure close cooperation between SPTI format development (incl. Starling, Tuvalu, Gogglebox and 2waytraffic Creative), SPT initiatives and Embassy Row

• Pursue strategic alliances (acquisitions, minority investments or first-look deals) with promising format creators on a worldwide basis to ensure flow of content to the SPTI/2way distribution engine

• Establish light entertainment capabilities in offices which previously primarily focused on scripted content, e.g. Russia, Germany, Spain

Four cornerstones to SPTI’s Production Strategy

7

Production – Key Strategic Goals

2. Increase profitability in existing operations

• Re-position Germany operation to be a profitable, diversified producer of scripted and non-scripted programming

– Augment capabilities with upcoming acquisition of spin tv

• Complete turn-around process of Lean-M

– Improve company’s earnings through new, efficient management and reduced production costs

– Finalize new partnership agreement with founders to ensure SPE is fully in control

• Fully establish SPTI as independent producer in Latin America

– Use investment in Colombian producer Teleset as growth catalyst

• Emphasize increased programming commissions in the U.K. and Spain

8

Production – Key Strategic Goals

3. Expand footprint/scale of the production operation

• Close investment in German production company spin tv

• Evaluating strategies to enter Poland and Scandinavia

4. Establish and maintain presence in emerging markets with

strategic importance

• China: Continue slow build of joint venture Huaso

– First Huaso drama The Game premiered on China’s national broadcaster CCTV; first series where a major non-sino company had significant influence

• India: In preliminary partnership discussions with several local production companies for potential investment

• Explore operations in Turkey

9

Production – MRP Financials

318

249 249

323286

376

425

0

100

200

300

400

500

Rev

enue

($M

M)

FY 09 FY 10 FY 11 FY 12

Budget / Prior MRP Q2 Fcst / Current MRP

Revenue

23.7

8.3

25.2 25.128.6

40.0

50.0

0.0

10.0

20.0

30.0

40.0

50.0

EB

IT (

$M

M)

FY 09 FY 10 FY 11 FY 12

Budget / Prior MRP Q2 Fcst / Current MRP

EBIT

CAGR: 82%

Significant growth due to inclusion of 2waytraffic *

* 2waytraffic was not included in last year’s MRP

10

Production – MRP Financials

EBIT Summary

(US$Millions) FY12

Budget Forecast VariancePrior MRP

Current MRP Variance

Prior MRP

Current MRP Variance

Current MRP

2waytraffic 35.0 27.1 (7.9) 0.0 38.8 38.8 0.0 48.5 48.5 55.82waytraffic Amortization (30.0) (22.1) 7.9 0.0 (23.8) (23.8) 0.0 (23.8) (23.8) (19.9)2waytraffic 5.0 5.0 0.0 0.0 15.0 15.0 0.0 24.8 24.8 35.9

France (SPTI + Starling) 9.7 10.8 1.1 8.3 9.8 1.5 8.6 10.2 1.6 10.3Russia (SPTI + Lean-M) 9.6 3.5 (6.2) 14.1 5.9 (8.2) 15.2 9.7 (5.5) 10.5Germany (SPTI + Spin) 3.1 (1.9) (5.0) 4.6 0.7 (3.9) 6.8 3.2 (3.6) 4.9UK (SPTI + Gogglebox + Shine) 1.9 1.6 (0.3) 1.9 4.1 2.2 2.2 5.6 3.4 6.0UK Prev. Acq Target (Twofour) 0.0 0.0 0.0 3.0 0.0 (3.0) 3.2 0.0 (3.2) 0.0Netherlands (Tuvalu) 1.0 1.0 0.0 2.3 2.3 (0.0) 2.5 2.5 (0.0) 2.5Spain 0.7 (0.8) (1.4) 3.6 2.1 (1.6) 4.3 3.2 (1.1) 3.9Italy 0.7 0.1 (0.6) 0.3 0.0 (0.2) 0.4 0.0 (0.3) 0.0Europe 26.7 14.2 (12.5) 38.1 24.9 (13.2) 43.1 34.4 (8.7) 38.2

Latin America (SPTI + Teleset) 3.7 3.3 (0.3) 5.0 5.1 0.0 5.1 5.2 0.1 5.5

Asia & India (1.4) (0.9) 0.5 (0.6) (1.5) (0.9) (0.3) (0.8) (0.5) (0.3)

Development (1.8) (1.8) 0.0 (3.3) (2.5) 0.8 (4.0) (3.0) 1.0 (3.0)HO Overhead (LA/London) (8.1) (9.3) (1.2) (9.4) (9.7) (0.2) (9.6) (10.3) (0.7) (10.7)Allocations (3.1) (3.1) 0.0 (2.9) (3.2) (0.3) (3.0) (3.3) (0.3) (3.5)Other 2.7 0.9 (1.8) (1.8) (3.0) (1.2) (2.8) (6.9) (4.2) (12.0)

TOTAL 23.7 8.3 (15.4) 25.2 25.1 (0.1) 28.6 40.1 11.5 50.0

FY09 FY10 FY11

11

2waytraffic - Key Strategic Goals

Expand program portfolio, create new revenue streams and fully exploit Sony synergies

Grow successful format portfolio and increase its success

Invest in development and create unique IP suitable for multi-screen exploitation

Acquire/partner with creative companies and attract creative talent

Expand geographical footprint across all business lines Diversify further into television production

Continue to develop new revenue streams and

business models

Advertiser Lead Programming (ALP) and pay-per-play on mobile and internet

Increase synergies with mobile activities (e.g., Club Millionaire, ALP Mobile)

Build B2C presence on the Web (e.g., online, TV-style casual games)

Capitalize on integration and

synergies with SPE & Sony

Improve exploitation of SPE’s game show library Create significant relationship with GSN Integrate creative/production businesses worldwide Develop more advertiser and agency relationships

12

Revenue & EBITDA vs. Sony FY 09 Budget and Base Case

84

108

134120

154137

176

152

0

50

100

150

200

FY 09 FY 10 FY 11 FY 12

Q2 /MRP Sony Base Case

24.6

35.040.0 40.3

49.846.1

57.0

49.3

0.0

10.0

20.0

30.0

40.0

50.0

60.0

FY 09 FY 10 FY 11 FY 12

Q2 / MRP Sony Base Case

3

Revenue EBITDA

5.0 5.0

15.0

9.6

24.8 25.5

35.9

31.0

0.0

10.0

20.0

30.0

40.0

FY 09 FY 10 FY 11 FY 12

Q2 / MRP Sony Base Case

EBIT

Note: FY09 Q2 Forecast includes activity for only 10 months (June - March).

Assumes FY 2009 Revenue of €64MM and EBITDA of €18MM

2waytraffic – Financial Summary(U

.S.$

MM

)

(U.S

.$M

M)

(U.S

.$M

M)