Welcome toBritish Sky Broadcasting Group plcInterim Results

7 February 2001

Tony BallChief Executive Officer

Dec-98

Mar-99

Jun-99

Sep-99

Dec-99

Mar-00

Jun-00

Sep-00

Dec-00

Digital Analogue

Record Growth

5.1m

Dec-99 Dec-00

£281 £286

Dec-99 Dec-00

10.2%9.8%

Higher ARPU Low Churn

Update on customers

• 5.25m customers signed up

• 94% now digital

• On track to end analogue service

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

0 10 20 30 40 50 60

Months since launch

Su

bscri

ber

nu

mb

ers

(000's

)

Sky digital

NTLTelewest

ONdigital Via Digital

KirchPayTV

CSD TPS

CanalSate

Digital subscriber adoption rates

Sky subscriber demographics

-80% 90% Normal Distribution 110% 120%

Least affluent20%

Fourth mostaffluent 20%

Third mostaffluent 20%

Second mostaffluent 20%

Most affluent20%

Sky over-representedSky under-represented

0% 10% 20% 30% 40% 50% 60% 70%

Other

Value Pack

Sky MovieWorld

Sky SportsWorld

Sky World

Subscriber mix

Subscriber half - life

0%

50%

100%

0 1 2 3 4 5 6 7

10% churn 20% churn

+ 4 years

Years

Sub

scrib

ers

Year on year change in viewing

Three months to 31 December Source: BARB

% p

oin

t m

ove

men

t o

n p

rio

r ye

ar

2.0

1.5

1.0

0.5

0.0

0.5

1.0

1.5

ITV C4 C5 Sky

• Strong content pipeline

• Continued innovation

Operating profit before goodwill

• 82% growth on prior period

Martin StewartChief Financial Officer

Dec-98

Mar-99

Jun-99

Sep-99

Dec-99

Mar-00

Jun-00

Sep-00

Dec-00

Digital Analogue

Record Growth

5.1m

Dec-99 Dec-00

£281 £286

Dec-99 Dec-00

10.2%9.8%

Higher ARPU Low Churn

0

10

20

30

40

50

60

Q1 Q2 Q3 Q4

£’m

Op

erat

ing

pro

fit

Growing profitability

2000/01

1999/00

Dec-98 Mar-99 Jun-99 Sep-99 Dec-99 Mar-00 Jun-00 Sep-00 Dec-00

Digital Analogue

DTH subscribers5.1m

Subscribers by platform

£m

DTH

Cable

DTT

Eire cable

Total

Half Year 1999/00

3,966

3,306

527

605

8,404

Half Year2000/01

5,051

3,093

975

631

9,750

Dec-99 Dec-00

Churn10.2%

9.8%

Dec-99 Dec-00Cable Ondigital

Wholesale subscribers

527k

3,911k 3,724k

975k

Turnover

£m

DTH

Wholesale

Advertising

Sky Interactive

Other

Total

Half Year 1999/00

536

148

113

2

51

850

Half Year2000/01

715

146

134

37

54

1,086

DTH subscription revenue

Dec-99 Dec-00

£536m

£715m

Average revenue per subscriber

Dec-99 Dec-00

£281 £286

Dec-99 Dec-00

Sky Box Office revenues

£20m

£35m

Wholesale revenue

Dec-99 Dec-00

DTT

Cable£121m

£25m

£131m

£17m

Advertising revenue

Dec-99 Dec-00

£113m

£134m

Sky Interactive revenues

Dec-99 Dec-00

£2m

£37m

Costs£m

Programming

Transmission

Marketing

Subscriber Management

Administration

Interactive

Total

Half Year 1999/00

432

52

179

100

55

4

822

Half Year 2000/01

534

52

212

118

70

49

1,035

Programming costs

£m

Sports

Movies

Third Party Channels

Entertainment

News

Total

Half Year 1999/00

180

127

81

30

14

432

Half Year 2000/01

193

160

119

45

17

534

Marketing costs

Dec-99 Dec-00

£179m

£212m

Dec-98 Dec-99 Dec-00

Proportion of direct sales increasing

7%

26%30%

Transmission costs

Dec-99 Dec-00

£52m £52m

Subscriber management

Dec-99 Dec-00

£100m

£118m

Joint ventures

£mBiB

Kirch - share of lossKirch - Exceptional

Goodwill

Sky Ventures

Total

Half Year 1999/00

(47)

- -

-

(5)

(52)

Half Year 2000/01

(52)

(46)(70)

(36)

-

(204)

Operating profit before goodwill

Dec-99 Dec-00

£28m

£51m

EBITDA

Dec-99 Dec-00

£50m

£78m

Net debt

Dec-99 Mar-00 Jun-00 Sep-00 Dec-00

£1.4bn

Delivering on promises

• Subscriber growth

• Improved ARPU and churn

• Recovery in core profitability

Tony BallChief Executive Officer

• Right products

• Customer service

• New services to drive ARPU

Strategy

ARPU

£300

£400

2001 2002 2003 2004 2005

TV

Fixed linetelephonyInternet

Mobile

SMS

Source: CSFB

Hourly usage per day

Interactivity today

• 50% usage of Sky Sports Extra

• 1,300,000 e-mail registrations

• 500,000 customers made purchases

What is BiB?

BiB

MC Co

• STB subsidies• Subsidy recovery

Open….

• Shopping mall• Consumer brand• E-commerce and communications

Expertise

• People• IP / technology• Relationships

Multi-Channel

Interactive advertising

Betting Financial Billing Retail Holidays

Con

tent

Ser

vice

s

Consumer Services

Multi-Service

Sky interactive

• iTV

• Subscriber growth

• Increased ARPU

• Low churn

• Interactivity

Delivery

Questions & Answers

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Thank you.