Investment Opportunities in Constantin Medien AG

Transcription

1 Annual Report 21

2 SIMPLIFIED CORPORATE STRUCTURE As of December 31, 21 Major subsidiaries of Constantin Medien AG 1% 1% 1% 1% 47.3% Major subsidiaries of Highlight Communications AG 1% 1% 1% 1%

3 KEY FIGURES IN EURO MILLION Non-current assets Film assets Other intangible assets Balance sheet total Subscribed capital Equity Equity ratio (in percent) Non-current financial liabilities Current financial liabilities 12/31/ % /31/ % Sales Sports Film Sports- and Event-Marketing 1/1 to 12/31/ /1 to 12/31/ Earnings before interest, taxes, depreciation and amortization (EBITDA) Amortization, depreciation and impairment Profit from operations (EBIT) Earnings before taxes (EBT) Net loss/profit attributable to shareholders Cash flow from operating activities Cash flow for investing activities Cash flow for financing activities Outstanding shares in million Share price in Euro Market capitalization (based on outstanding shares) 12/31/ /31/ Average number of outstanding shares (basic) in million Earnings per share from continuing operations (basic) in Euro Earnings per share from continuing operations (diluted) in Euro 1/1 to 12/31/ /1 to 12/31/ Employees (at closing) 1,52 1,351

4 THE YEAR FEBRUARY 21 At a press conference on February 2, the new multimedia umbrella brand SPORT1 is presented for the sports channel DSF and the sports portal Sport1. MARCH 21 On March 24, the Group announces the renewal of the mandate between the Highlight Communications subsidiary TEAM and the UEFA for the marketing of the commercial rights for the UEFA Champions League, the UEFA Europa League and the UEFA Super Cup. At the same time, it is agreed that the UEFA will sell its 2 percent shareholding in Team Holding AG to Highlight Communications AG on June 3, 21, Highlight then holds 1 percent of the interests. APRIL 21 As part of the realignment of the Sports Segment, the new multimedia umbrella brand SPORT1 is launched on April 11 for all of the Group's TV, online and mobile activities. On April 22, Constantin Medien AG announces a buy-back offer for the 5.25% convertible bond 26/213. MAY 21 As part of the co-operation agreement between Constantin Medien AG and Deutsche Telekom AG, the opening match of the Ice Hockey World Championship between Germany and the USA on May 7 is broadcast exclusively in 3D and HD on LIGA total!. The editing and production technical responsibility for its implementation lies with SPORT1, PLAZAMEDIA and Constantin Sport Medien as the operator of LIGA total!. JUNE 21 At the Annual General Meeting on June 9, the shareholders of Constantin Medien AG agree to all agenda topics with approval ratings of more than 96 percent, respectively. On June 1, Highlight Communications AG announces changes in the management structure of TEAM Marketing. The responsibility for operational management is now executed by a Senior Management Group. AUGUST 21 In August, Constantin Sport Marketing GmbH starts its operations as the new centralized marketer of all the Sports Segment brands and for third-parties and their platforms. SEPTEMBER 21 In line with its multimedia strategy, the Group announces the launch of the new pay-tv channel SPORT1+ in SD and HD being broadcast via the platforms of Kabel Deutschland, Kabel BW and Unitymedia as well as via Entertain, the TV-platform from Deutsche Telekom. On September 6, Highlight Communications AG announces the premature renewal of the successful co-operation between its subsidiary TEAM and the Vienna Philharmonic Orchestra lasting until 217. On September 16, following Step Up 3D, Resident Evil: Afterlife, Constantin Film AG's second S3D production, is released to German movie theaters. The fourth episode of the Resident Evil series immediately claims, the top spot of the box office charts. OCTOBER 21 On October 5, Constantin Medien AG's Management Board resolves to issue a corporate bond with a volume of 3 million Euro. The bond has a term of five years, accruing interest at 9. percent p.a. Animals United Constantin Film AG's third 3D production hits German movie theaters on October 7. NOVEMBER 21 As part of opening up additional digital distribution channels, on November 1, with SPORT1 HD, the programming of the free-tv channel SPORT1 started in the High Definition standard on the platform HD+ of the satellite operator SES ASTRA. During the course of the year, the cable network operators Unitymedia, Tele Columbus and Kabel BW are added as distribution platforms. SPORT1 HD already started in September on Entertain. SPORT1 expands its ice hockey commitment, becoming the official partner of the German Ice Hockey Federation (DEB). The co-operation includes the exclusive broadcasting rights of the German Cup up through 213 and the exclusive exploitation rights to all matches of the German national team for the next three years. In addition, SPORT1 acquires the exclusive live rights to the IIHF Ice Hockey World Championship from Infront Sports & Media up through 217. DECEMBER 21 On December 17, SPORT1 announces the acquisition of extensive sublicensing rights to the 211 Formula One season from RTL. Following the releases of Step up 3D, Resident Evil: Afterlife 3D and Animals United (3D), Constantin Film's fourth distributed theatrical film vincent will meer, hits the million mark 21.

5 THE COMPANY

6 THE COMPANY CONTENT CONTENT THE COMPANY COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT 4 Foreword by the Chairman of the Management Board 6 Boards 7 Report of the Supervisory Board 1 Declaration of Corporate Governance pursuant to 289a HGB 14 Constantin Medien AG Share 2 1. Business and general conditions Result of operations, financial and net assets positions of Constantin Medien Group Result of operations, financial and net assets positions of Constantin Medien AG Employees Addendum report Disclosures in accordance with 289 para. 4 and 315 para. 4 of German Commercial Code (HGB) Material transactions with related companies and related persons in the reporting period Risk report Opportunities report Outlook Forward-looking statements This Annual Report contains statements relating to future events that are based on management s assessments of future developments. A series of factors beyond the control of the company, such as changes in the general economic and business environment and the incidence of individual risks or occurrence of uncertain events, can result in the actual results differing substantially from those forecast. Constantin Medien AG does not intend to continually update the forward-looking statements contained in the Annual Report. Important notice This document is a free translation into English of the original German text. It is not a binding document. In the event of a conflict in interpretation, reference should be made to the German version, which is the authentic text. 2

7 CONSOLIDATED FINANCIAL STATEMENTS INDIVIDUAL FINANCIAL STATEMENTS 72 Consolidated balance sheet 74 Consolidated profit and loss account 75 Consolidated statement of comprehensive income/loss 76 Consolidated cash flow statements 78 Changes in consolidated equity 8 Notes to the consolidated financial statements 8 1. General information 8 2. Accounting policies Scope of consolidation Accounting and valuation principles Notes to selected line items in the consolidated balance sheet Notes to selected line items in the consolidated profit and loss account Disclosures regarding financial risk management Segment reporting Accounting estimates and assumptions Financial commitments, contingent liabilities and other financial commitments Relationships with related companies and persons Subsequent events after the balance sheet date Other information and disclosures 148 AG-Balance sheet (HGB) 15 AG-Profit and loss account (HGB) THE COMPANY 151 Finance Calendar Imprint 146 Responsibility statement 147 Auditor s report 3

8 THE COMPANY FOREWORD BY THE CHAIRMAN OF THE MANAGEMENT BOARD FOREWORD BY THE CHAIRMAN OF THE MANAGEMENT BOARD Dear Shareholders, The Constantin Medien Group looks back on a challenging financial year 21 in which we slightly exceeded our expectations in business performance. Group sales reached 47.3 million Euro, somewhat above the target range of 44 million Euro to 46 million Euro and down on the previous year, in line with expectations. With earnings attributable to shareholders of million Euro, we slightly improved against the forecasted target corridor of -12 million Euro to -14 million Euro. As in the preceding years, the earnings were also substantially impacted by amortization charges related to the purchase price allocation for our shareholding in Highlight Communications AG. We have thus reached the goals for 21 that we had announced to the capital market early on. Demonstrating this reliability is important, because it is the basis for the trust in our Company. The three operating segments of Constantin Medien AG have developed differently in the past year: Despite the unchanged fierce competition in the TV advertising market, the Sports Segment succeeded in improving earnings by 14.5 million Euro, thereby closing with a nearly balanced result. The basis for this encouraging development was the extensive restructuring measures undertaken in our sports business that we had already initiated back in mid-29 and which we successfully completed during the third quarter 21. The focal point was implementing the multimedia umbrella brand SPORT1 for all TV, online and mobile activities and linked with the contextual and organizational integration of the various platforms. This also included the integration of all marketing activities in sports through the new marketing company, Constantin Sport Marketing GmbH, which was launched in the third quarter 21. We not only optimized structures and processes and reduced costs, but we also further developed the Sports Segment in terms of strategy and program contents. The free-tv station SPORT1 significantly invested in new rights and formats, thus, above all, enormously expanding its live broadcasting. As part of the strategic realignment of the Segment, we set our targets on opening up new digital distribution channels for our extensive sports programming: The distribution of SPORT1's TV programming in the HD standard, as well as the successful launch of our new pay-tv channel SPORT1+ in HD and SD on October 1, 21, represent important first steps in this direction, that we want to pursue. The Film Segment delivered a weaker business performance in 21 versus the prior year, but was in line with our expectations. The reasons for this mainly included a lower production volume for TV service productions due to the lasting restrictive expenditure policies of TV stations and lower revenues from theatrical distribution and license trading. Following the outstanding year in 29 for box office hits, the number of moviegoers in Germany fell by approximately 14 percent in 21. Despite this, Constantin Film AG secured its position as a leading independent German producer and distributor of theatrical, DVD and television films. Every second film ranking among the Top 1 most popular German films of 21 was produced and released by Constantin Film. The most successful Constantin Film title of the year was the 3D animation Animals United, which fascinated more than 1.4 million viewers from early October until the year end. But also the other 3Dtitles which started in the second half of 21, Step Up 3D and Resident Evil: Afterlife, fulfilled our expectations. We anticipate attractive perspectives for the international film industry through the establishment and advancement of 3D technology. Constantin Film AG is set to help shape this trend in the coming years. The Sports- and Event-Marketing Segment registered a successful year in 21 in both operative and strategic terms. Sales rose accompanied by improved earnings through higher revenues from the successful marketing of the UEFA Champions League and the UEFA Europa League. Once again, the Highlight Communications subsidiary TEAM proved its competence and performance strength through the distribution of the top-class competitions in European club soccer. We were more than pleased that the European soccer association UEFA renewed the proven co-operation with TEAM for the seasons running through 214/215 and even until 218, 4

9 subject to achieving certain performance targets. In the past year, TEAM furthermore succeeded in signing a new agency agreement with the Vienna Philharmonic Orchestra until 217, thus carrying forward this successful partnership. I would also like to express my sincere appreciation to you our valued shareholders as well as to all our customers, business partners and employees for your trust and support. Dear Shareholders, In principle, we are in a positive mood regarding the Constantin Medien Group's operational business performance in the current year. The overall economic environment is encouraging, although economic risk factors such as the European debt crisis cannot be ignored. In the Sports Segment we will proceed with the digitization and diversification of distribution channels for our content platforms and open up new revenue sources. Whether and to what extent SPORT1, as a special-interest channel, will benefit from the advertising industry s renewed increased willingness to spend will be of great importance. In the film business, we want to keep focusing on complex 3D productions, films with event character, family entertainment productions and bestseller adaptations by applying the principle of class not mass. In the area of TV service productions, it will remain to be seen whether improved economic conditions will lead to a revival in demand from channels. We anticipate an unchanged successful business performance in the Sports- and Event- Marketing Segment on the basis of the long-term contracts. With best regards Bernhard Burgener Chairman of the Management Board Looking ahead at 211: All in all, we are confident that the Constantin Medien Group will take another step forward with its long-term goal of generating stable positive earnings in 211. Taking into consideration the costs of Group financing and the holding, we nevertheless anticipate negative Group earnings attributable to the shareholders for the current year, but at a significantly reduced level. The Management Board is predicting Group sales of 47 million Euro to 49 million Euro for 211, with Group earnings attributable to shareholders of -6 million Euro to -7 million Euro. I am certain that Constantin Medien AG will also prove to be reliable in this estimation. 5

10 THE COMPANY BOARDS BOARDS Management Board Supervisory Board As of December 31, 21, the Management Board of Constantin Medien AG was structured as follows: As of December 31, 21, the Supervisory Board of Constantin Medien AG was composed as follows*: Bernhard Burgener, Chairman of the Management Board/CEO Bernhard Burgener has been CEO of Constantin Medien AG since September 1, 28. He is responsible for the strategic development of the entire group, the support of major stockholders, M&A activities and Communications as well as company and stock law and Compliance. Since July 1, 29, Bernhard Burgener has also been responsible for the entire operations of the Sports Segment. In addition, he is responsible for the affiliated company, Highlight Communications AG, where he is CEO of the Board of Directors; for the Film Segment comprising the Highlight Communications subsidiary, Constantin Film AG, where he holds the position of CEO since January 1, 29; and for the Sportsand Event-Marketing Segment, which comprises the Highlight Communications shareholding TEAM, where Mr Burgener is the President (Chairman) of the Board of Directors. Fred Kogel, Chairman of the Supervisory Board Werner E. Klatten, Deputy Chairman of the Supervisory Board Dr Erwin Conradi, Member of the Supervisory Board Dr Dieter Hahn, Member of the Supervisory Board Dr Bernd Kuhn, Member of the Supervisory Board Jan P. Weidner, Member of the Supervisory Board *For further information regarding the Supervisory Board positions during the year please refer to page 7 of the Report of the Supervisory Board, to page 27 the Combined Group Management and Management Report and Note 13 of the Notes to the Consolidated Financial Statements (page 143) Antonio Arrigoni, Chief Financial Officer/CFO Antonio Arrigoni has been a Member of the Management Board of Constantin Medien AG since April 1, 28. He is responsible for the areas of Finance, Investor Relations, Accounting, Controlling, Human Resources and Administration, Legal as well as IT and Process Management. Mr Arrigoni is also a Member of the Board of Directors of Highlight Communications AG. 6

11 REPORT OF THE SUPERVISORY BOARD THE COMPANY REPORT OF THE SUPERVISORY BOARD Fred Kogel, Chairman of the Supervisory Board In the financial year 21, the Supervisory Board of Constantin Medien AG met its obligations in accordance with the law and the Company's Articles of Association, duly advising the Management Board of the Company, as well as monitoring its activities. On the basis of oral and written reports, the Supervisory Board followed in detail the business development of the AG and of the Group, as well as all significant business issues. The Supervisory Board of Constantin Medien AG consists of six Members, which are elected by the Shareholders' Meeting in accordance with 5 Number 1 of the Articles of Association. The following changes occurred within the Company's Supervisory Board during the year under review: With effect as of the end of the Annual General Meeting of Constantin Medien AG on June 9, 21, the terms officially ended for the Supervisory Board Members, Dr Erwin Conradi and Mr Martin Wagner, who had been elected to the Board by resolution of the Annual General Meeting from June 27, 27. By letter dated July 19, 21, the Management Board, with the approval of the Supervisory Board and pursuant to 14 (2) clause 2 AktG, requested a judicial order for Dr Conradi and furthermore the attorney Dr Bernd Kuhn with the respective registry court, because Mr Martin Wagner was no longer available for this office. On the basis of a resolution dated August 6, 21, the registry court appointed Dr Conradi and Dr Kuhn as Supervisory Board Members of the Company in conformity with the judicial order. The Supervisory Board currently comprises of the following three committees: The Personnel and Nominations Committee, which convened once in 21, is responsible inter alia for the preparation and negotiations of employment contracts with Management Board Members and preparing of nominations for the election of Supervisory Board Members at the Annual General Meeting. It consists of three members: Dr Dieter Hahn and Mr Fred Kogel, whereby Mr Kogel is the Chairman and Dr Hahn the Deputy Chairman. Furthermore, Dr Erwin Conradi belongs to the Personnel and Nominations Committee. The three-member Audit Committee primarily deals with issues concerning the accounting, the effectiveness of the internal control system, the risk management system, compliance and the commissioning of the audit to the independent auditors. The Audit Committee met on four occasions in 21. The Audit Committee is chaired by Mr Jan P. Weidner, who took over this position from Mr Werner E. Klatten on May 21, 21, who has since then been a Member of the Supervisory Board. The Deputy Chairman is Dr Dieter Hahn. The Legal and Compliance Committee deals with monitoring and advising the Management Board in complying with statutory laws and internal corporate guidelines. The committee was constituted during the year under review and convened a total of four times. The size of the committee was enlarged from two to three members after the first two meetings. Following Mr Martin Wagner's resignation from the Supervisory Board, the Chairman of this committee is now Dr Bernd Kuhn. Other members in this committee include Mr Fred Kogel (Deputy Chairman) and Mr Werner E. Klatten. The Company's Supervisory Board convened at five ordinary meetings during the reporting year. All Members of the Supervisory Board participated in four of the ordinary meetings; two Members were absent with excuse at one meeting. As in the previous years and as is common practice, both Members of the Management Board also participated in all meetings in order to report to the Supervisory Board and to answer its questions. And also as in the past years, the Supervisory Board called on the advice of authorized experts, in particular auditors. There was also regular contact between the Management Board and the Members of the Supervisory Board in between meetings, keeping them informed about the business situation of Constantin Medien AG and the Constantin Medien Group at all times. This especially applies to the Chairmen of the Management and Supervisory Boards. As it is standard practice, the Supervisory Board also made resolutions by way of circulation between the meetings on the basis of detailed documentary information. During 21, the Supervisory Board focused primarily on the following matters: 7

12 THE COMPANY REPORT OF THE SUPERVISORY BOARD Business situation and performance At its meetings, the Supervisory Board extensively dealt with the current status of Constantin Medien AG and the Group. To this end, the Management Board presented the current business performance, liquidity position, key business transactions and changes in the risk situation of the three Segments Sports, Film as well as Sports- and Event-Marketing and thoroughly discussed these with the Supervisory Board. The economic performance of Constantin Medien AG was also a regular topic of the consultations. In particular, the focal point in the reporting year was on the restructuring of the Sports Segment that began back in 29 and accompanied by the creation of the umbrella brand SPORT1 as well as on the strategic and economic mid-term planning regarding the activities in this area. This dealt with the ongoing analysis of the economic and legal framework conditions in the sports advertising and sports production market and the strategic opportunities and risks arising therefrom for the sports companies SPORT1 and PLAZAMEDIA. Group financing Particular attention was given by the Supervisory Board in its consultations during the year to the financial needs and financing strategies of Constantin Medien AG and of the Constantin Medien Group. The focus was on the further repurchasing of the convertible bond 26/213 by means of a tender offer, through which 847,285 bond units were repurchased by the Company at a price of 5.65 Euro. In addition, the Supervisory Board discussed and examined various alternatives regarding the long-term corporate financing. On October 5, 21, the Supervisory Board approved the issuance of a corporate bond with a volume of 3 million Euro and a maturity of five years. Investments and divestments In the year under review, the Supervisory Board approved various important investments and divestments of the Group. This included, among others, the launch of the new pay-tv channel SPORT1+ in SD and HD quality as well as the broadcasting of SPORT1's programming in HD quality. The disposal of Constantin Medien AG's minority shareholding in WIGE Media AG was part of the divestments in the past year. Furthermore, the Supervisory Board was presented with the long-term contract for the renewal of Highlight Communications subsidiary TEAM's mandate with the UEFA to market the UEFA Champions League, the UEFA Europa League and the UEFA Super Cup. The Supervisory Board was also presented with the acquisition of UEFA's remaining 2 percent shareholding in Team Holding AG as at June 3, 21. Restructuring of the Sports Segment By way of several changes under company law, the restructuring of the Sports Segment was completed during the financial year 21. In this connection, the Supervisory Board approved the merging of Sport1 Online GmbH to Sport1 GmbH and the resulting spin-off of Sport1 GmbH's marketing activities to AdImpulse Media GmbH, which was renamed to Constantin Sport Marketing GmbH and acts as a centralized marketing unit for the entire Sports Segment. Appointment and remuneration of the Supervisory Board The Supervisory Board, in close collaboration with the Personnel and Nominations Committee, dealt in detail with the renegotiation of the Management Board contracts of Mr Bernhard Burgener and Mr Antonio Arrigoni. As part of the renegotiation, it was ensured that the Management Board remuneration takes into account all legal requirements of the Executive Compensation Law, particularly the contractual structure of the variable remuneration components. The Supervisory Board unanimously appointed Mr Bernhard Burgener as Chairman of the Management Board for a term until August 31, 213 and accordingly amended his executive contract. The resolution for appointing Mr Antonio Arrigoni as a Management Board Member was also unanimously approved for a term until June 3, 214 and his executive contract was accordingly amended. Statements concerning disclosures contained within the Management Report and the Group Management Report of the Company in accordance with 315 para. 4 HGB Constantin Medien AG disclosed information in the Group Management Report for the 21 financial year in accordance with 315 para. 4 HGB. The disclosures meet the requirements prescribed in the 24/25 EG guideline issued by the European Parliament and the Council of the European Union as of April 21, 24 in respect of tender offers. The obligation to issue this information falls on companies whose voting shares are listed on an organized market in accordance with 2 para. 7 of the Securities Acquisition and Takeover Act (WpÜG). 8

13 This is irrespective of whether a takeover offer has been made or is expected to be made. The information serves to enable potential bidders to make a comprehensive assessment of the Company and of potential takeover obstacles. The Supervisory Board has examined the relevant information contained within the Combined Group Management Report and Management Report. Specific details in respect of this matter can be found in the Combined Group Management Report and Management Report (section 6). Audit and adoption of the annual financial statements The financial statements of Constantin Medien AG, the consolidated financial statements and the Combined Group Management Report and Management Report of Constantin Medien AG as of December 31, 21 have been examined by the assigned auditor, PricewaterhouseCoopers AG Wirtschaftsprüfungsgesellschaft, and have been issued with an unqualified Auditor's Certificate. The financial statements, consolidated financial statements and the Combined Group Management Report and Management Report were submitted in a timely manner to all Members of the Supervisory Board along with the audit reports, enabling a detailed examination of the documents. The Constantin Medien Group completed the restructuring of the Sports Segment in 21 and has thus setting the course for achieving positive performance in this area even under persistently challenging market conditions. In 211 as well, the further development of the Sports Segment, in particular of SPORT1, will be a focal point of the Management and Supervisory Boards efforts. The Supervisory Board still considers the Group to be well-positioned in the Film Segment. With the signing of a new long-term marketing contract with the UEFA, the Sports- and Event-Marketing Segment has established a solid foundation to continue its successful business development with a long-term perspective. Regardless of all the challenges facing our markets, these developments provide confidence for the future of the Constantin Medien Group. The Supervisory Board would like to express its sincere gratitude to the Management Board and to all employees of the Group for their work accomplished. Their expertise, creativity and dedication form the basis of our success. March 211 Supervisory Board of Constantin Medien AG In its meeting for purpose of adopting the financial statements, held on March 22, 211, the auditors reported on the key findings of their audit to the Supervisory Board. The Supervisory Board examined in detail the financial statements of Constantin Medien AG and the consolidated financial statements as well as the Combined Group Management Report and Management Report and duly noted their approval of the findings of the auditors. Following the completion of its examination, the Supervisory Board raised no objections to the financial statements and the consolidated financial statements. The Supervisory Board approved the financial statements and the consolidated financial statements of the Company in the form presented by the Management Board. The set of the annual financial statement is thereby adopted. Fred Kogel Chairman 9

14 THE COMPANY DECLARATION OF CORPORATE GOVERNANCE PURSUANT TO 289a HGB DECLARATION OF CORPORATE GOVERNANCE PURSUANT TO 289a HGB Declaration of compliance with the German Corporate Governance Code The Management and Supervisory Boards provide their report on the corporate governance of Constantin Medien AG pursuant to section 3.1 of the German Corporate Governance Code. version of Section of the Code has not been met at the time this declaration was submitted, since the special importance attached to this topic requires appropriate handling by the Supervisory Board, which was not yet possible due to the extent required and is planned to be addressed in the financial year 211. The Management and Supervisory Boards of Constantin Medien AG hereby confirm that the recommendations of the German Corporate Governance Code in the version dated June 18, 29 have been duly observed, with the exceptions stated in the Declaration of Conformity dated December 29, and that the recommendations of the Code in the version dated May 26, 21 have been duly observed, with the following exceptions: A fixed age limit for Members of the Management Board has not been specified (Section of the Code). Given the age of the two Management Board Members of the Company, the specification of a fixed age limit does not appear to be necessary at the present. In addition, the Company deems that a fixed age limit to be a very rigid instrument that unnecessarily restricts the flexibility of the Supervisory Board in appointing Members to the Management Board; the Supervisory Board will in any case take into account the age of the Management Board Members in their new or reappointed terms. The specification of concrete objectives regarding the composition of the Supervisory Board, that consider the specifics of the company, while taking into account the international activities of the company, potential conflicts of interest, a fixed age limit to be specified for Members of the Supervisory Board and diversity as well as stipulating an appropriate degree of female representation are presently being examined (Section of the Code). According to the new version of Section of the Code, the Supervisory Board should specify concrete objectives for its composition that, while considering the specifics of the company, take into account the international activities of the company, potential conflicts of interest, a fixed age limit to be specified for the Members of the Supervisory Board and diversity and should stipulate an appropriate degree of female representation. The recommendation introduced with the new The time limit for the submission of quarterly reports (interim financial reports) has not yet been reduced to 45 days following the end of the reporting period (section of the Code). It is planned to comply with this recommendation of the German Corporate Governance Code (submission of interim reports within 45 days) as early as is feasible. In respect of the accounting complexity of our Company and its shareholdings, this time limit should first be implemented when the optimization of internal processes can be assured so that the required sustainability and reliability can take place. The most recent version of the Declaration of Conformity with the German Corporate Governance Code, as well as previous versions, can be found on the homepage Information regarding corporate governance practices Principles The Management and Supervisory Boards work together in good faith for the benefit of the Company and are committed to the principle of sustainable growth in company value. It is the aim of Constantin Medien AG to consistently justify the trust of its shareholders, customers and employees and to fulfill their corporate responsibilities. Here the principles of responsible and good corporate governance determine the actions of management and controlling bodies of the Company. Integrity in dealing with, as well as credibility, reliability and dependability to its employees, business partners and customers, shareholders, investors and the public, form the basic principles of conduct. The Constantin Medien Group is committed to regular, transparent and timely communication. In its Annual, Half-year and 1

15 Quarterly Reports, Constantin Medien AG regularly issues information concerning the development of its business. In addition, information is published by means of press releases and ad hoc notifications. All reports, notices and presentations as well as comprehensive information about Constantin Medien AG are made available by the Company on its homepage Shareholders and Annual General Meeting The shareholders of Constantin Medien AG are entitled to exercise their rights at the Annual General Meeting, where they may cast their votes. Each shareholder is entitled to participate in the Annual General Meeting, to pass comments on individual agenda items, to ask questions and to propose motions. Constantin Medien AG simplifies the process by which shareholders may exercise their voting rights through the appointment of a shareholder-committed voting representative. Accounting and year-end audit Constantin Medien AG prepares its consolidated financial statements and consolidated interim financial statements in conformity with the International Financial Reporting Standards (IFRS), as adopted by the European Union. The individual financial statements of Constantin Medien AG are prepared according to the German Commercial Code (HGB). The preparation of the consolidated and separate financial statements is the responsibility of the Management Board. Following the preparation of the consolidated and separate financial statements, they are then audited by the independent auditors appointed by the Annual General Meeting and approved and adopted, respectively, by the Supervisory Board. It was agreed with the auditor that he reports without delay to the Chairman of the Supervisory Board and the Chairman of the Audit Committee about any reasons of exclusion or conflicts of interests as well as any material findings and events discovered during their audit procedures. AG are autonomously managed by the Board of Directors and the Management Board, respectively. Authoritative control indicators comprise of financial performance indicators (such as sales and earnings ratios) and non-financial performance indicators (based on the respective business models of the individual segments). Detailed information about the controlling system and performance indicators can be found in the Combined Group Management and Management Report under section 1.6 Controlling system and performance indicators on page 25. The internal control system of the Constantin Medien Group encompasses all principles, procedures and measures undertaken to assure the effectiveness, profitability and appropriateness of the internal and external accounting system and contributes to compliance with authoritative legislation. A detailed description of the elements of the internal control system in place within the Group, which also incorporates the risk management system throughout the Group, can be found in the Combined Group Management and Management Report under section 8 Risk Report on page 54. Collaboration between the Management and Supervisory Boards As a German public limited company, the Group parent company Constantin Medien AG has a dual management and control system ( Two-Tier System ), i.e. the Management and Supervisory Boards are separate bodies with strictly separate Members and duties. Since July 1, 29, the Management Board of Constantin Medien AG has consisted of two Members, Mr Bernhard Burgener (CEO) and Mr Antonio Arrigoni (CFO). The Management Board is responsible for directing Constantin Medien AG and for representing the Company in third party dealings. The principle tasks of the Management Board include the determination of corporate strategy, Group management and the monitoring of risk management. Controlling system and control indicators The Management Board of Constantin Medien AG is responsible for the strategic course and the control of the Group. The operational responsibility of the subsidiaries of the Sports Segment underlies the particular managing director of each subsidiary. Highlight Communications AG and Constantin Film The Management Board works closely with the Supervisory Board. It informs the Supervisory Board on a regular, timely and comprehensive basis of all Company and Group relevant issues associated with planning, business performance, risk status and risk management. The Management Board agrees with the Supervisory Board on the corporate strategy and discusses 11

16 THE COMPANY DECLARATION OF CORPORATE GOVERNANCE PURSUANT TO 289a HGB its strategic implementation on a regular basis. Documents requiring decisions, in particular the Constantin Medien AG separate financial statements, consolidated financial statements and the audit report are forwarded to the Members of the Supervisory Board in advance of the particular meeting. The internal bylaws governing the Management Board incorporate veto rights on the part of the Supervisory Board for business transactions of fundamental and major significance. The Supervisory Board of Constantin Medien AG consists of six members. The Supervisory Board advises and monitors the Management Board in its management of the Company. In addition, its responsibilities also include the appointment of Management Board Members. The Supervisory Board has created a Personnel and Nominations Committee, an Audit Committee and a Legal and Compliance Committee. The Personnel and Nominations Committee is responsible in particular for preparing and negotiating contracts with Management Board Members and for nominations for the election of the Supervisory Board Members by the Annual General Meeting. It also works out proposals for Management Board remuneration to the Supervisory Board plenum. The Audit Committee assists the Supervisory Board in its oversight role, in particular in the areas of accounting, internal control system, risk management, the selection and monitoring of the auditors, and compliance. The Chairman of the Audit Committee, Mr Jan P. Weidner, is an independent financial expert and has special knowledge and experience from his professional practice regarding the application of accounting principles and internal control procedures. The Legal and Compliance Committee is responsible for the oversight and advising of the Management Board in observing statutory requirements and the internal corporate guidelines. The Supervisory Board convened at a total of five plenary meetings during 21. The Audit Committee met on four occasions, the Personnel and Nominations Committee on one and the Legal and Compliance Committee met four times. The Chairman of the Supervisory Board explains the activities of the Supervisory Board and its committees in its report presented each year to the shareholders in the respective Annual Report of the Company. Management Board contractual terms Mr Bernhard Burgener has been a Member of the Management Board of Constantin Medien AG since September 1, 28, and has since then acted as Chairman of the Management Board. He had a contract term until August 31, 211. On November 17, 21, Mr Burgener was appointed as the Chairman of the Management Board for a term extending beyond August 31, 211 until August 31, 213. His contract was accordingly amended. Effective April 1, 28, Mr Antonio Arrigoni assumed the position of Chief Financial Officer of Constantin Medien AG. His contract term ran until March 31, 211. On August 18, 21, Mr Arrigoni was appointed as a Management Board Member for a term extending beyond March 31, 211 until June 3, 214. His contract was accordingly amended. The new Management Board contracts particularly take into account the regulations set forth in the law for appropriate Executive Compensation (VorstAG), which came into force on August 5, 29. Report on Management Board Remuneration In compliance with the German Corporate Governance Code, the monetary remuneration components for each Management Board Member consist of both fixed and variable components. The variable remuneration components are in part specified by the Supervisory Board at its dutiful discretion and in part on a multi-year assessment base, which, among others, is oriented on the development of the share price and the earnings of the Group. The variable remuneration components are contractually limited. The contracts of the Management Board Members also contain a so-called severance payment cap in the event that the contract is prematurely terminated without cause. The Management Board Members are reimbursed for all out-ofpocket expenses and other costs incurred in performing tasks for the Company as well as a company vehicle made available to them for business and personal use. Moreover, the Company has concluded a Directors' & Officers (D&O) liability insurance policy, which contains a corresponding self-deductible amount in accordance with legal requirements, and an accident/invalidity insurance policy. 12

17 There are no payment guarantees to Members of the Management Board of Constantin Medien AG in the event of a change in control relating to Constantin Medien AG. Report on Supervisory Board Remuneration The remuneration of the Supervisory Board Members is regulated by section 12 of Constantin Medien AG s Articles of Association. In addition to reimbursement of expenditures incurred, Members of the Supervisory Board also receive fixed and variable annual remuneration. The fixed remuneration amounts to 2, Euro for Members of the Supervisory Board, 3, Euro for the Deputy Chairman of the Supervisory Board and 6, Euro for the Chairman of the Supervisory Board. The fixed remuneration also takes into consideration membership (5, Euro) and chairing (1, Euro) of Supervisory Board Committees. The variable remuneration is based partly on the short-term and partly on the long-term success of the Company. Remuneration is paid on a pro rata basis for resignation or entry into the Supervisory Board during the year. Further information on the Management and Supervisory Boards can be found within the Note Boards (page 6), within the Combined Group Management and Management Report (pages 21, 27) and within Note 13 Other Information and Disclosures of the Notes to the Consolidated Financial Statements (page 143). 13

18 THE COMPANY CONSTANTIN MEDIEN AG SHARE CONSTANTIN MEDIEN AG SHARE Performance of the capital markets Following a brief consolidation phase early in 21, the general upward trend continued on the German stock market and the international capital markets, driven by positive economic signals and supported by ongoing historically low interest rates. This movement culminated in the second quarter 21 into a volatile lateral shift in conjunction with concerns emerging regarding the financial system's stability and the indebtedness of some countries. Due to brighter economic indicators, which were backed by positive company figures as well as from higher risk willingness by capital market participants, the third quarter 21 closed with a volatile upward trend that accelerated towards the end of the year. Nonetheless, risk factors remain with respect to the stability of the financial system and the quality of the economic recovery, which was partially manifested in the very volatile movements on the capital market. The positive performance delivered during the period under review resulted in a listing by many leading indices at year-end at a level well above the share prices posted at the beginning of the year. Therefore, the German leading index DAX gained 16 percent in the calendar year 21, closing at 6,914 points on December 31. The German small cap and media stocks performed, in part, significantly better, although these values were comparatively more affected by the previous stock drops than the blue chip stocks. The small cap index SDAX, which also lists the Constantin Medien shares, gained almost 46 percent, closing at 5,174 points. The German media index (DAXsector Media) closed at 144 points, improving by roughly 62 percent compared to the beginning of the year. Constantin Medien share performance In the financial year 21, the Constantin Medien share's performance was marked on the whole by a volatile downward movement, thus moving against the general market trend. At the beginning of the year, the share price initially moved downwards in line with the overall market, which was then partially offset by a share price increase in mid-february. In contrast to the general market trend, the share price followed a volatile downward movement in the second quarter 21. In line with the development of the capital market, the slight upward movement in the third quarter 21 accelerated towards the end of the year, but was compensated in part due to the falling share price starting in mid-december. The Constantin Medien share closed at 1.75 Euro at the end of the year. As of December 31, 21, the 52-week high stood at 2.7 Euro (January 11, 21), with the 52-week low coming in at 1.5 Euro (June 8, 21). Consequently, at percent the Constantin Medien share price substantially underperformed the comparative German small cap index SDAX (+45.8 percent) and the German media index DAXsector Media (+62.2 percent). In addition to publishing the business figures for the 21 business year, the Company also announced information concerning the restructuring and realignment of the Sports Segment by means of combining the TV, online and mobile activities of this segment under the umbrella brand SPORT1 and the implementation of the multimedia strategy through additional programming transmission via pay and HD channels, respectively. In the Sports- and Event-Marketing Segment, the subsidiary TEAM succeeded in renewing the marketing contracts with the UEFA and the Vienna Philharmonic Orchestra. Furthermore, the subsidiary Highlight Communications AG acquired 2 percent in the shares of Team Holding AG from the UEFA; thereby increasing its shareholding to 1 percent. In addition to the public tender offer to repurchase the 5.25% Convertible Bond 26/213, the successful placement of a corporate bond was announced. In the remaining course after the balance sheet date, the Constantin Medien AG's share price followed an upward movement. The share price closed at 1.98 Euro on February 15, 211. In 21, approximately 2.3 million Constantin Medien shares were traded on the German stock exchanges (a daily average of.8 million units). Subsequently, the trading volume considerably decreased by 28.3 percent compared to the prior year's period. Due to lower trading volumes versus the same period last year, the stock turn rate for shares outstanding over a twelve-month period decreased to.28 (prior year:.37). The position of the Constantin Medien share in German stock exchange rankings of all MDAX and SDAX listings stood at ranking number 15 as of December 31, 21 (prior year: 86) in respect of trading volume over the last twelve months. The share ranked 16th for the so-called free float market capitalization (prior year: 81). 14

19 XETRA CLOSING PRICES OF THE CONSTANTIN MEDIEN SHARE COMPARED TO SDAX AND DAXSECTOR MEDIA INDICES Comparative indices indexed to Constantin Medien's closing price as of December 31, Constantin Medien AG SDAX DAXsector Media /31/9 3/31/1 6/3/1 9/3/1 12/31/1 Share capital and shareholder structure Constantin Medien AG's share capital did not change during 21, amounting to around 85.1 million Euro as of December 31, 21. As a consequence of the full consolidation of its subsidiary Highlight Communications AG, their shares in Constantin Medien AG qualify as treasury shares; insofar the Company held a total of 7.4 million non-voting treasury shares (8.7 percent of share capital) via Highlight Communications AG as of December 31, 21. After deduction of treasury shares, there were approximately 77.7 million shares outstanding as of the balance sheet date. On July 26, 21, Mr Burgener informed the Company via a Directors Dealings notification that he increased his shareholding to 5.9 percent of share capital. The free float of the Constantin Medien share stood at 57. percent of share capital as of December 31, 21. SHAREHOLDER STRUCTURE AS AT DECEMBER 31, 21 Subscribed capital 85.1 million shares TREASURY SHARES 1 57.% 8.7% 3.% 5.9% 18.7% 6.7% KF 15 2 DR ERWIN CONRADI BERNHARD BURGENER FREE FLOAT DR DIETER HAHN 1 Predominantly held via the Highlight Communications AG 2 Call option for further 8.% of share capital until March 31,

20 THE COMPANY CONSTANTIN MEDIEN AG SHARE Additional Constantin Medien AG capital market securities The price of the 5.25% Convertible Bond 26/213 increased by 17.6 percent in 21, closing at 5.89 Euro. As of February 15, 211, the bond traded at 5.88 Euro. Each convertible bond entitles a conversion in Constantin Medien AG shares. The shares of Highlight Communications AG, a company of the Constantin Medien Group, developed similarly to the Constantin Medien share in 21, developed below the comparative indices. The share price closed at 4.19 Euro on December 31, 21, a price increase of 3.2 percent compared to the beginning of the year. On February 15, 211, the share price stood at 4.78 Euro. On October 13, 21, Constantin Medien AG issued a corporate bond with a volume of 3 million Euro in the form of a private placement at institutional investors in Germany and abroad. The bond has a term of five years and accrues interest at 9. percent p.a. The corporate bond was included as a follow-through by third parties in the open market of the Stock Exchange. INFORMATION OF CONSTANTIN MEDIEN SECURITIES AS OF DECEMBER 31, 21 ISIN/Exchange abbreviation Ordinary share (Prime Standard Segment) Highlight Communications AG share (Prime Standard Segment) Convertible bond 26/213 (Regulated market) Corporate bond 21/215 (Open market) DE914727/91472 CH /92299 DEAGQKR4/AGQKR DEA1EWS1/A1EWS Indices Closing rate 12/31/21 / 52-week high / 52-week low Constantin Medien AG (Xetra) Highlight Communications AG (Xetra) Convertible bond 26/213 (Frankfurt) Corporate bond 21/215 (Frankfurt) SDAX, DAXsector Media 1.75 / 2.7 / 1.5 Euro 4.19 / 4.7 / 3.53 Euro 5.89 / 5.89 / 5. Euro / -- / -- percent Share capital 12/31/ million shares Outstanding shares (12/31/21) Convertible bond 26/213 outstanding Corporate bond 21/215 outstanding 77.7 million shares 7.4 million shares 29, shares Market capitalization (related to shares outstanding as of 12/31/21) Constantin Medien AG (Xetra) Highlight Communications AG (Xetra) Convertible bond 26/213 Corporate bond 21/ million Euro million Euro 43.7 million Euro 27.5 million Euro 16

21 Investor Relations activities The Constantin Medien Group's focus of the investor relations activities lies in the comprehensive and timely exchange of information with all capital market participants (institutional and private investors, analysts and the financial press). It is our declared aim to attain a fair evaluation of the Constantin Medien share by means of transparent public relations. This is based on our regularly published annual and interim financial reports that portray a detailed view of our Company's current performance and perspectives. Furthermore, extensive information concerning the Constantin Medien Group is provided on our website under In addition to a number of individual talks with institutional investors, Constantin Medien AG was also available to interested parties at two investor conferences. Moreover, numerous individual inquiries from private investors were addressed by our Investor Relations department. Alongside participation in events for analysts and investors, it is our objective to support the highest possible number of analysts. The Constantin Medien share is currently being actively monitored by eight research institutions. In the last twelve months, the following six different institutions published studies on Constantin Medien AG: Close Brothers Seydler Bank Commerzbank Deutsche Bank DZ Bank Viscardi WestLB Directors Dealings as of December 31, 21 In the financial year 21, the Company was notified by Members of the Management and Supervisory Boards of the following reportable purchase and sale transactions: NAME DATE TRANS- ACTION SECURITY QUANTITY PRICE PER SHARE TOTAL VOLUME Management Board Bernhard Burgener 7/21/1 Buy Share Share 75, in Euro 1.55 in Euro 1,162,5 Shareholding of Board Members as of December 31, 21 BOARD NAME NUMBER OF SHARES The executive Board Members, Mr Bernhard Burgener (CEO), Dr Dieter Hahn (Supervisory Board Member) and Dr Erwin Conradi (Supervisory Board Member) each held a direct or indirect holding of shares exceeding 1 percent in shares or share entitlements of the share capital as of December 31, 21. The number of shares on the part of executive Board Members and their related parties as of December 31, 21 is presented as follows. Share entitlements associated with option rights for executive Board Members don t exist. Management Board Supervisory Board Bernhard Burgener Antonio Arrigoni Fred Kogel Werner E. Klatten Dr Erwin Conradi Dr Dieter Hahn Dr Bernd Kuhn Jan P. Weidner 5,5, 6,279 33, 5,735,95 2,543, 8,47 17

22 18 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT

23 19

24 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT 1 Business and general conditions 1.1 Business activities Constantin Medien AG is an international operating media company based in Ismaning near Munich and focuses on the Sports Segment and, via its holding in the Swiss media company Highlight Communications AG, on the Segments Film as well as Sports- and Event-Marketing. The Sports Segment covers the activities within the TV sector with the free-tv channel SPORT1 (formerly DSF Deutsches SportFernsehen) and the pay-tv channel SPORT1+ as well as in the online sector with the sports portal SPORT1.de. Following the one brand strategy, the sports channel as well as the sports portal have been represented under the new multimedia umbrella brand SPORT1 since April 11, 21. In the field of IPTV, subsidiary Constantin Sport Medien operates the Bundesliga live channel LIGA total! as a self-contained live program. PLAZAMEDIA is a further substantial Group subsidiary and offers comprehensive services in the field of production together with its subsidiaries. Since August 21, the new centralized marketer Constantin Sport Marketing is responsible for the integrated and the cross-platform marketing of the Group-owned brands in the Sports Segment and also acts as a third-party marketer for external clients and their platforms. The Film Segment combines the activities of Constantin Film AG and its subsidiaries as well as the Highlight Communications holdings Rainbow Home Entertainment. The Constantin Film group is the major independent German producer and distributor of theatrical films, video/dvd and television films. The operations of Constantin Film AG encompass the production of films as well as the exploitation of in-house productions and acquired film rights. In exploiting film rights, all steps along the exploitation chain are utilized starting from theatrical to video/dvd and up to television. In-house film productions are usually distributed worldwide, while co-productions are essentially distributed in German-speaking countries. In addition, the Constantin Film group creates fictional and non-fictional productions for TV stations. For purposes of exploiting the video rights for in-house and licensed films, Highlight Communications AG has its own distribution organization. In Switzerland and Austria, distribution is executed by the Rainbow Home Entertainment companies. In addition, third-party products are also marketed in these countries. Distribution on the German market is conducted by the 1 percent holding Highlight Communications (Deutschland) GmbH in co-operation with Paramount Home Entertainment. The Sports- and Event-Marketing Segment includes the activities of Team Holding AG (TEAM) and its subsidiaries. The TEAM group, based in Lucerne, specializes in the global marketing of international major events. Being one of the world's leading agencies in this field, it exclusively markets on behalf of the European Football Association the UEFA Champions League as well as the UEFA Europa League and the UEFA Super Cup. Further projects of the TEAM group include the marketing of the Eurovision Song Contest and a marketing co-operation with the Vienna Philharmonic Orchestra. As part of this co-operation, TEAM markets the world-renowned New Year's Concert and the annual Summer Night Concert at the Schönbrunn Palace in Vienna. Others include the activities of the holding company Constantin Medien AG and the financing activities of EM.TV Finance B.V. 1.2 Group structure As parent company, Constantin Medien AG is the controlling holding company and is responsible for the strategic control of the Group, as well as for central functions such as Human Resources, Accounting, Legal, Corporate Finance, Corporate Communications and Investor Relations. Constantin Sport Holding GmbH functions as the controlling parent company of the subsidiaries in the Sports Segment and is owned 1 percent by Constantin Medien AG. Among others, it holds 1 percent of the shares in SPORT1 GmbH (previously DSF Deutsches SportFernsehen GmbH), in Constantin Sport Medien GmbH as well as in Constantin Sport Marketing GmbH (previously AdImpulse Media GmbH). PLAZAMEDIA GmbH TV- und Film Produktion is also a 1 percent shareholding of Constantin Sport Holding. PLAZA- MEDIA, for its part, has 1 percent shareholdings in further Group companies, among others, in PLAZAMEDIA Austria Ges.m.b.H., Vienna/Austria and PLAZAMEDIA Swiss AG, Wollerau/Switzerland. 2

25 The Highlight Communications AG is a stock corporation under Swiss law and is listed on the Frankfurt Stock Exchange since It holds among others 1 percent in Constantin Film AG, in Rainbow Home Entertainment AG, Pratteln/Switzerland and Rainbow Home Entertainment Ges.m.b.H., Vienna/ Austria. Moreover, it has been holding 1 percent (previously: 8 percent) in Team Holding AG, Lucerne/Switzerland since June 3, Important events in the 21 business year Spin-off of license, dubbing and co-production agreements The spin-off of license, dubbing and co-production agreements of Constantin Medien AG to RM 2925 (as the legal entity) had been finalized and was entered into the Commercial Registers of both companies (Constantin Medien AG and RM 2925 Vermögensverwaltungs GmbH) in January 21. The sale of the shares took place in February 21. Company draws line under the claims for damages Despite objections had been raised, until the lapse of the period for filing a suit in January 21, no actions for rescission were asserted against the resolutions passed by the extraordinary General Meeting on December 15, 29 concerning the settlement agreements with both D&O insurers, CHUBB Insurance of Europe SE (CHUBB) and ACE European Group Limited (ACE). Consequently, Constantin Medien's claims in the gross amount of 57.5 million Euro were settled at the beginning of February 21. Due to contractual obligations, Constantin Medien AG paid-out a portion of the settlement payment of about 9.2 million Euro early in February 21. Buy-back tender offer for convertible bonds 26/213 accepted On April 22, 21, a buy-back tender offer was submitted to the bondholders of the 5.25% convertible bonds 26/213 issued by EM.TV Finance B.V., Amsterdam/Netherlands, and guaranteed by Constantin Medien AG at a purchase price of at least 5.65 Euro for each convertible bond (including accrued interest). On May 4, 21, Constantin Medien AG announced that a uniform purchase price of 5.65 Euro for all offers accepted for the repurchase of the convertible bonds could be achieved. The total nominal amount for the convertible bonds purchased came to around 4.9 Euro. Annual General Meeting of Constantin Medien AG On June 9, 21, the Annual General Meeting of Constantin Medien AG, which represented 41.4 percent of the voting share capital, agreed to all agenda topics with a majority of more than 96 percent each. Changes in the Supervisory Board of Constantin Medien AG With effect as of the end of the Annual General Meeting of Constantin Medien AG on June 9, 21, the terms officially ended for the Supervisory Board Members, Dr Erwin Conradi and Mr Martin Wagner, who had been elected to the Board by resolution of the Annual General Meeting from June 27, 27. By letter dated July 19, 21, the Management Board, with the approval of the Supervisory Board and pursuant to 14 (2) clause 2 AktG, requested a judicial order for Dr Conradi and furthermore the attorney Dr Bernd Kuhn with the respective registry court, because Mr Martin Wagner was no longer available for this office. On the basis of a resolution dated August 6, 21, the registry court appointed Dr Conradi and Dr Kuhn as Supervisory Board Members of the Company in conformity with the judicial order. Constantin Medien AG issues corporate bond With the approval of the Supervisory Board, Constantin Medien AG's Management Board resolved to issue a corporate bond in the volume of 3 million Euro, on October 5, 21. The bond has a term of five years and accrues interest at 9 percent. The bond had been placed at institutional investors in Germany and abroad and is primarily served to refinance existing financial liabilities. The corporate bond was issued on October 13, 21. Realignment of the Sports Segment Implementation of the multimedia umbrella brand SPORT1 In the course of the realignment measures undertaken within the Sports Segment of Constantin Medien AG and, considering the convergence of media platforms and the changing media usage behavior of viewers and users, the new umbrella brand SPORT1 was launched on April 11, 21, combining all of the Group's TV, online and mobile activities. Corporate actions related to the launch of SPORT1 On March 29, 21, the company name change of DSF Deutsches SportFernsehen GmbH to SPORT1 GmbH and the 21

26 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS renaming of the co-subsidiary Sport1 GmbH to SPORT1 Online GmbH were recorded in the Commercial Register. With the entry in the Commercial Register on July 3, 21, SPORT1 Online GmbH was merged to SPORT1 GmbH. Implementation of the new centralized marketer Constantin Sport Marketing In August 21, the new centralized marketer Constantin Sport Marketing started the marketing of the Sports Segment s brands and third-parties. For this purpose, the SPORT1 marketing division was split off and incorporated into Constantin Sport Marketing GmbH on August 2, 21. Previously to that, AdImpulse Media GmbH's name change to Constantin Sport Marketing GmbH had been recorded in the Commercial Register on August 1, 21. Completion of restructuring and opening up new digital distribution channels start of SPORT1 HD and SPORT1+ Following the convergence of the TV, online and mobile platforms under the multimedia umbrella brand SPORT1 and the start-up of the new centralized marketer Constantin Sport Marketing, the structural and the corporate restructuring of the Sports Segment has been completed. In the third and fourth quarter 21, new channels and distribution opportunities in terms of the multimedia strategy were opened up for the distribution of the SPORT1 s programming in the High Definition format and, in particular, the new pay-tv channel SPORT1+ in HD and SD was launched. First 3D Ice Hockey Match in Europe As part of a co-operation between Constantin Medien AG and Deutsche Telekom AG, the opening match of the Ice Hockey World Championship between the host country Germany and the USA on May 7, 21 in Gelsenkirchen was broadcasted live and exclusively in 3D and HD on LIGA total! and live on SPORT1 (in SD). For the very first time in Germany, the viewers of a sporting event were given accessibility to watching a 3D transmission. Sky Austria appoints PLAZAMEDIA Austria In the third quarter 21, Sky Austria charged the PLAZA- MEDIA subsidiary PLAZAMEDIA Austria Ges.m.b.H., Vienna, for the production of the Austrian soccer Bundesliga for the seasons 21/211 through 212/213 (in total 36 matches per season). SPORT1 massively expands commitment in Ice Hockey As part of an agreement with the German Ice Hockey Federation (DEB), contracted in November 21, SPORT1 acquired the exclusive rights to the Deutschland Cup up through 213 for broadcasting on SPORT1 and SPORT1+ and also acquired the exclusive media exploitation rights to all matches of the German national team for the next three years. Since November 21, SPORT1 has also been the DEB's official partner. Moreover, SPORT1 secured the exclusive media live rights to the IIHF Ice Hockey World Championship from Infront Sports & Media AG, Zug/Switzerland, for all distribution channels up through 217. In 211, too, SPORT1 reports live and via Highlights of Formula One In December 21, SPORT1 secured extensive sublicensing rights from RTL for reporting of the 211 Formula One season: The rights package comprises the exclusive live broadcast in free-tv of the 1 st and 2 nd Free Practice on Friday and the highlights of the 'Qualifyings' on Saturday as well as the actual race on Sunday. Co-operation agreement with Little Shark Entertainment extended In January 21, Constantin Film AG prematurely extended the co-operation agreement with the production company, Little Shark Entertainment, which was formed in 1998 by director Sönke Wortmann, for another two years The aim of this co-operation is the development, production and exploitation of the co-productions of both companies. Constantin Film once again most successful producer and distributor of German films in 29 Constantin Film AG was once again the most successful producer and distributor of German films for the 29 theatrical year; thereby securing the receipt of this year's grant in both categories of the FFA Industry Tiger from the Filmförderungsanstalt (German Federal Film Board, FFA) in April 21 for the fifth time in a row. In total, the FFA grants 15.7 million Euro to economically and culturally successful German producers, distributors and short films of 29. Constantin Film AG scored with twelve films in the production category most notably with Pope Joan, Männersache and Wickie und die starken Männer and received reference funding 22

27 amounting to 2. million Euro. In the distribution category, Constantin Film Verleih GmbH secured the FFA Industry Tiger for the sixth time in a row: 16 films brought in subsidies of 854, Euro. Rat Pack Filmproduktion GmbH received subsidies in the amount of 273,8 Euro in the first quarter of 21. Source: FFA, Press release as of April 1, 21 Bernd Eichinger honored with German Film Award and additional awards for the Constantin Film group Bernd Eichinger received an honorary award for his life's work at the ceremony of the German Film Prize on April 23, 21 in Berlin. The team of the Rat Pack Filmproduktion GmbH was very pleased with the award for the Best Children's and Youth Film for the film Vorstadtkrokodile 1. On April 3, 21, Wickie und die starken Männer and its director Michael Bully Herbig were awarded with the GOLDENER SPATZ ( GOLDEN SPARROW ) from the German Children's Media Foundation and, at the Munich Film Festival, as well as the Constantin Film co-production Hier kommt Lola, with the Children's Media Prize 21 DER WEISSE ELEPHANT ( WHITE ELEPHANT ). At the Giffoni Children's and Youth Festival at the end of July 21, the Constantin Film Family Entertainment productions Hier kommt Lola and Vorstadtkrokodile 2 were awarded with first prizes. In addition, "Hier kommt Lola" received the audience award. The Bavarian Film Award 21 went to the productions vincent will meer and Animals United. The leading actor and screenwriter, Florian David Fitz, was presented with the Bavarian Film Award 21 Screenplay on January 14, 211 in Munich. He had already won the Bambi - National Actor award in November 21 for his portrayal of the Tourette's syndrome-suffering Vincent. In addition, Olga Film Production won the Audience Award from the Bavarian Film Award. The Bavarian Film Award 21 Children's Film went to the producers and directors Reinhard Klooss and Holger Tappe for Animals United. Constantin Film Schweiz AG acquires Kontraproduktion AG Following the acquisition of a 79 percent shareholding in Kontraproduktion AG, Zurich/Switzerland, as of May 14, 21 at a purchase price of 6 Euro, Constantin Film Schweiz AG, Basel/Switzerland acquired the remaining interests of 21 percent at a purchase price of 2 Euro on August 13, 21. Successful film release of Sennentuntschi On September 23, 21, Sennentuntschi, a production of Kontraproduktion AG celebrated its world premier as the opening film at the Zurich Film Festival. The Alpensaga from the accomplished Swiss director Michael Steiner had its release in mid-october 21 in Switzerland and was the most successful Swiss film in 21 with more than 145, viewers. Successful renewal of TEAM s agency mandates As of March 24, 21, UEFA and TEAM concluded a new agency agreement. Therein, UEFA appointed its long-standing partner TEAM to market the commercial rights for the UEFA Champions League, UEFA Europa League and UEFA Super Cup, initially for three additional seasons (212/213 until 214/ 215). Subject to achieving contractual performance targets, this contract will automatically renew until at least June 218. New Management at TEAM On June 1, 21, Highlight Communications AG announced changes in the management structure of TEAM Television Event And Media Marketing AG. As of this date, the company's Board consists of Bernhard Burgener (Chairman) and Martin Wagner (Delegate). The overall responsibility for the operating management is to be executed by a Senior Management Group. Purchase of UEFA shareholding in Team Holding AG Effective June 3, 21, the UEFA sold its 2 percent shareholding in Team Holding AG to Highlight Communications AG. Since that date, Highlight Communications AG holds 1 percent of the shares in Team Holding AG. Premature extension of co-operation agreement with the Vienna Philharmonic Orchestra On September 6, 21, Highlight Communications AG announced that the Vienna Philharmonic Orchestra and TEAM had prematurely agreed to extend their successful partnership for a further five years until

28 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS 1.4 Material legal factors As an internationally operating company, the activities of the Constantin Medien Group are subject to the jurisdiction of numerous domestic and foreign legal systems. Material legal factors for the free-tv channel SPORT1, the pay- TV channel SPORT1+ and the Bundesliga live channel LIGA total!, which is operated by Constantin Sport Medien GmbH, are the Interstate Broadcasting Agreement and the state media laws whose observance is monitored by the individual media institutions from each German Federal State. SPORT1 as well as SPORT1+ and LIGA total! are falling under the jurisdiction of the Bavarian Regulatory Authority for Commercial Broadcasting (BLM). The free-tv channel SPORT1 has a broadcasting license until April 2, 215. The pay-tv channel SPORT1+ has a valid broadcasting license up through March 31, 212. For this purpose, the BLM approved the renaming of the channel DSFdigital to SPORT1+ as well as a programming schematic for the pay-tv channel on July 19, 21, based on a broadcasting license for its operations, which was granted on March 25, 24 by the BLM. Constantin Sport Medien GmbH was granted a broadcasting license from BLM up through July 31, 217. The sweepstake shows legislation, adopted by the State Media Authorities in February 29, includes, inter alia, stricter rules for call-in formats. The emphasis here is on protecting minors, and especially on stricter transparency requirements for sweepstakes. In the course of the legal validity of the new State Gambling Treaty as of January 1, 28, the advertising of sports betting (on TV and online) was initially not enforceable in general in Germany. However on September 8, 21, the European Court of Justice ruled that the German gambling business is incoherent and that its legal status as well as its actual use is contrary to European law. The EU law takes clear precedence over national law and thus clearly over the Gambling Treaty. This was also clarified by the decision of the Federal Administrative Court on November 24, 21. Independently, gambling without placing money and games for amusement involving a stake of no more than 5 Euro cents per game are permitted. Film promotion by the German Federal Film Fund (DFFF) is of great relevance for Constantin Film AG. The DFFF serves to improve the macroeconomic conditions in the German film economy, to maintain and to promote the international competitiveness of companies in film business and to set sustainable impetus for the film production landscape in Germany as well to achieve other economic effects. In 211, the DFFF provided funds of approximately 58.9 million Euro. A total of 115 sponsored film productions economically impacted the promotion of film productions in Germany with a total volume of more than 34 million Euro*. The DFFF has strengthened Germany as an international film location in recent years. *Source: DFFF, Press release dated January 2, 21 In addition, as listed companies, Constantin Medien AG as well as its subsidiary Highlight Communications AG are subject to substantial regulatory requirements regarding the reporting as well as the preparation and publication of their consolidated financial statements. 1.5 Market research and development Market and TV viewer research is still the basis for SPORT1 GmbH in monitoring the programming line-up of its channels SPORT1 and SPORT1+ to continuously examine its viewer appeal, to acquire attractive license rights, to develop innovative formats and to ensure programming that accurately reflects viewer preferences. SPORT1 is a licensee of the Arbeitsgemeinschaft Fernsehforschung, AGF, (Television Research Consortium), which commissions the Gesellschaft für Konsumforschung (GfK, Society for Consumer Research) with ongoing viewer research. Also, SPORT1.de regularly analyzes selected key performance indicators. For this purpose, the Arbeitsgemeinschaft Online Forschung, AGOF (Online Research Group, AGOF) in 21 provided a quarterly uniform online currency, unique users i.e., the number of unique visitors to a Web site. The Informationsgemeinschaft zur Feststellung der Verbreitung von Werbeträgern e.v., IVW (German Information Association for the Ascertainment of Distribution of Advertising Media) reports the monthly usage data for advertising media on the Internet. Recorded page impressions (PIs) and visits also make it possible to detect trends in this industry sector. 24

29 Since innovations rank among the strategic factors for success in the production services business, PLAZAMEDIA group puts a special focus on the further development of its technological capabilities. To fully meet the rising demand for innovative High Definition productions, the year 21 at PLAZAMEDIA was entirely dominated by developing the very future-oriented HDTV high-resolution TV standard that guarantees a much improved sound and picture quality and increased productions in 3D, allowing sports reporting and broadcasting in entirely new and extraordinary production values. Constantin Sport Marketing continuously analyzes the development of advertising spendings of all relevant advertisers and competitors in media TV and online on the basis of surveys made by Nielsen Media Research for gross advertising revenues and is also a licensee of Nielsen advertising statistics. In addition, the TV and market research resulting from GfK coverage data form the basis for market-adequate pricing of TV marketing space. Therefore, Constantin Sport Marketing is also a licensee of Arbeitsgemeinschaft Fernsehforschung (AGF). The media industry has markedly changed in the last ten years. In particular, continuing convergence of media and the rapid development of the Internet have contributed to the way of development, of production and exploitation of audiovisual content has changed. Ten years ago, the German Federal Film Board (FFA) published a study about the situation of the film and TV industry in Germany. It is now anticipating new findings in this sector in the current financial year. Key data, such as, among others, company structures, financing sources, production volume, location factors, workforce structures, etc. are of great relevance for Constantin Film AG's work and strategies. 1.6 Controlling system and performance indicators Group controlling The Management Board of Constantin Medien AG is responsible for the strategic course and the control of the Group. With respect to the Group companies of the Sports Segment, the operational responsibility underlies the particular management of each subsidiary. The controlling of the companies within this Segment is conducted through shareholders' meetings and similar bodies. Highlight Communications AG, as a stock corporation subject to Swiss law and Constantin Film AG as a stock corporation under German law, are autonomously managed by the Board of Directors and the Management Board respectively. As a shareholder, Constantin Medien AG exercises control in the Highlight Communications group by means of its 47.3 percent interest Financial performance indicators Sales and earnings are the Constantin Medien Group s key control parameters for operating performance. For purpose of controlling and classifying the return on capital, further financial ratios are calculated several times per year, including return on equity and return on assets. These figures are benchmarked against other companies. In addition, other key financial ratios are calculated, such as earnings before interest and taxes (EBIT), the return on sales (EBIT margin) and earnings attributable to shareholders Non-financial performance indicators and factors of success Beyond the financial key performance indicators, non-financial performance indicators and factors of success arising from the specific requirements of the particular business model are also of key significance for the Company's performance. A differentiation between the segments occurs regarding the nonfinancial performance indicators Sports Segment In the free-tv area of SPORT1, these indicators include the daily coverage and market shares that are surveyed by Gesellschaft für Konsumforschung (GfK), the standardized online coverage currency unique users for the online-area, which were reported in 21 on a quarterly basis by the Arbeitsgemeinschaft Online Forschung (AGOF). Moreover, the Informationsgemeinschaft zur Feststellung der Verbreitung von Werbeträgern e.v. (IVW) monthly reports the page impressions (PI) and visits. In the pay-tv area, the key indicator is the number of subscribers. Technical coverage: Regarding the attractiveness of SPORT1 as a platform for advertisers, the technical coverage (terrestrial, via cable and satellite) of the channel is of great relevance. Currently, SPORT1's coverage extends to almost 93 percent of all accessible households in Germany, which means that it can be received virtually everywhere. 25

30 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS Access to sports rights: To maintain and be able to expand its market share within the core target group, SPORT1 puts great emphasis on access to and availability of attractive sports rights. Thus, it is very important for the broadcaster to be included in the processes for awarding of such rights. This is especially the case for the broadcasting of soccer matches. Access within this sector is also dependent upon factors such as convincing programming concepts and a close-knit network of contacts with decision-makers in this area. Also, in respect of the new pay-tv sports channel SPORT1+, accessibility and availability of attractive sports rights are important criteria in guaranteeing and successively raising the pay-value. Editorial expertise: To achieve appropriate audience or user coverage, which in turn forms the basis for economic advertising placemats, both SPORT1 and SPORT1.de have to ensure attractive and expert reporting of sporting events. In terms of target-group acceptance, but also in receiving the necessary regulatory permits, it is essential that audiences must perceive the broadcaster as having expertise in sports and journalistic credibility. This know-how is also a decisive factor for SPORT1+, especially with respect to opening up new distribution platforms. Correspondingly, recruiting, promoting and retaining well-trained, technical, dedicated and creative employees are of high priority. In terms of changing usage behavior and growing demand, especially in the direction of moving image offerings, alongside the content-related, above all the technical expertise and further development of multimedia applications are relevant in the online and mobile area. With regards to the positioning of LIGA total! and the client's perception, acceptance and satisfaction, which in turn impact the development of the on-demand figures for the platform carrier Deutsche Telekom AG, it is important to ensure that the Bundesliga and 2 nd Bundesliga matches receive top priority in expert editorial handling and presentation. Therefore, the Bundesliga channel LIGA total! also works with renowned sports journalists and experts on the editorial department. Innovative capability and capacity performance: The success of LIGA total! depends not least on the technological innovative capability and the production technical capacity of the operator. Especially regarding varied features, which the platform carrier has already installed and will provide in the future, and the production volume per match day, pose maximum demands on performance in terms of highly complex technical processing and the skills of the entire team. In addition, the error-free distribution via mobile devices and the supply of archives should also be ensured. This also largely relates to the necessary transmission security of live productions and an error-free, timely delivery and transmission of the product. In order to nationally and internationally compete, the performance in terms of production volume is of crucial importance for PLAZAMEDIA, too. The program-output produced in hours is a starting point for upstream and downstream services. The program-output is analyzed according to the criteria shown below (amounts in thousands of hours): Live vs. Non-live in 21: 182, of which 53 live (PY: 156, of which 28 live) Classic TV vs. IPTV in 21: 182, of which 8 IPTV (PY: 156, of which 6 IPTV) Sports vs. Non-sports in 21:182, of which 138 sports (PY: 156, of which 11 sports) Innovative capability: The success of PLAZAMEDIA largely depends on its ability to offer clients high-quality and forwardlooking services in the areas of outside, in-house, studio and post productions as well as in new media, program processing and consulting. Given the higher demand for production technologies like HD and 3D, in addition to experience, especially the innovative competence is one of the crucial competitive factors. With regard to the smooth functioning of technologically-complex production processes among others, at LIGA total! maximum demands are required from the expertise and flexibility of the entire production team. For a marketer like Constantin Sport Marketing, high market penetration is of key importance, especially in all relevant media agencies and advertisers both at the level of the decision-makers and at the operational planning level with regard to the implementation of marketing concepts and strategies Film Segment Competitive pressure on the theatrical market was again quite 26

31 extensive in 21. Against this background, Constantin Film AG precisely monitors the activities of its competitors to release own productions under the best possible market conditions and season. In the production of its theatrical films, the company counts on film titles that are emotionally-triggered to the needs of the audience, that are based on certain brands, have event-character and/or can be realized in 3D. Therefore, Constantin Film AG is working very closely with renowned and experienced screenwriters, directors and producers in Germany and abroad for decades, having a high level of know-how in the production of theatrical films and TV formats. The monetary remuneration components for each Management Board Member consist of both fixed and variable components. The variable remuneration components are in part specified by the Supervisory Board at its dutiful discretion and in part on a multi-year assessment base, which, among others, is oriented on the development of the share price and the earnings of the Group. The variable remuneration components are contractually limited. The contracts of the Management Board Members also contain a so-called severance payment cap in the event that the contract is prematurely terminated without due cause. Constantin Film AG's particular expertise in developing and producing films is documented in the fact that 13 of the Top 3 films that hit the cinemas between 22 and 21 originated from Constantin Film's distribution slate and/or were produced by Constantin Film AG. During this same period, nearly 4 percent of the admission tickets sold for a German production were redeemed for a Constantin Film title. Source: Blickpunkt: Film, March 8, 211 (EDI Rentrak) Sports- and Event-Marketing Segment Marketing of rights: The ability to market attractive and usually internationally exploitable rights is essential to the success of the Sports- and Event-Marketing Segment. The most important requirement for the corresponding marketing mandates is a close, trusting business relationship with the rights holders. 1.7 Declaration on Corporate Governance pursuant to 289a HGB For the Declaration of Compliance that includes disclosures about corporate management practices and a description of working procedures of the Management Board and Supervisory Board, as well as the composition and working procedures of Committees, the reader is referred to our Website: Relations/Declaration on Corporate Governance pursuant to 289a HGB. 1.8 Key elements of the remuneration system Remuneration of the Management Board The remuneration of the Management Board Members of Constantin Medien AG lies in the responsibility of the Supervisory Board. Remuneration arrangements comply with the requirements of the German Stock Corporation Act and the recommendations and suggestions of the German Corporate Governance Code. Share entitlements from option rights for Management Board Members As of December 31, 21 no option rights were held by Management Board Members that would entitle them to subscribe shares of Constantin Medien AG. Remuneration of Supervisory Board Members The remuneration of the Supervisory Board Members is defined in 12 of the Articles of Association of Constantin Medien AG. In addition to the fixed component, the Members also receive a success-oriented remuneration, which among others, is also based on the long-term success of the Company as recommended in the German Corporate Governance Code. Share entitlements from option rights for Supervisory Board Members As of December 31, 21 no option rights were held by Supervisory Board Members that would entitle them to subscribe shares of Constantin Medien AG. For details on the remuneration of the Management and Supervisory Boards please refer to Note 13.4 of the Notes to the Consolidated Financial Statements. 1.9 Overall economic conditions in 21 Following the economic collapse in the recession year 29, the economies have markedly recovered in 21. The economy recovered faster than believed by the experts at the beginning of the year under review The International Monetary Fund (IMF) has yet again corrected its projections for the entire year 21 upwards at the beginning of October 21 and is now projecting substantial growth in the world economy of 4.8 per- 27

32 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS cent. This positive development continues to be propelled by the fast-growing emerging economies such as China or India. According to the calculations of the Federal Statistical Office, Germany reached price-adjusted growth in the gross domestic product (GDP) of 3.6 percent (29: -4.7 percent). Consequently, the German economy was at the top of all economies in the Euro zone. With the initial stimulus coming from abroad, the domestic economy has increasingly gained importance during the year according to the Ifo Institute for Economic Research Munich. A key factor was the economy's investment stimulus that resulted from historically low interest rate levels. Nevertheless, economic experts firmly agree that the economic recovery still remains fragile and is fraught with risks. Hence, the IMF urges reforms in the financial sector and consolidation of national budgets. There was general agreement at the end of 21 that the global economic growth is expected to slow down in 211. Sources: International Monetary Fund (IMF), World Economic Outlook, October 21, Ifo Institut für Wirtschaftsforschung e.v., Munich, Economic Prognosis 21/211, December 14, 21, Federal Statistical Office, Press Release, January 12, Sector-specific conditions in Sports Segment Free-TV Radio, television and multimedia attained greater relevance in Germany in the past year. According to Arbeitsgemeinschaft Fernsehforschung (AGF), television reached an average of more than 7 percent of the population per day and viewers watched an average of 223 minutes every day in the year under review (29: 212 minutes). Even the use of online and mobile offers increased in the reporting year, but is still behind radio and TV usage. The higher TV use together with the economic recovery in 21 is also reflected in the positive development of gross advertising revenues. The Zentralverband der deutschen Werbewirtschaft e.v. (ZAW) (Central Association of German Advertising Industry) is predicting growth in gross investments of 2.3 percent to 29.5 billion Euro in 21 for the entire advertising market. Following the substantial downturn to -6 percent in 29, turnaround towards an upswing took place in 21. According to Nielsen Media Research, the gross advertising revenues from television advertising increased by 16.2 percent to 1.91 billion Euro for the entire year 21 (29: around 9.4 billion Euro). Sources: Nielsen Advertising Statistics; Nielsen Media Research GmbH; Period: January December. 29; January December. 21, ZAW, press release ZAW-Prognosen 21 und 211: Werbemarkt dockt an BIP an and the study Allmählich aufwärts. The German Advertising Market 21/211 Pay-TV According to the Verband Privater Rundfunk und Telemedien e. V. (VPRT) (Association of Private Broadcasting and Telemedia, VPRT), the pay-tv market in Germany generated a total volume of 1.1 billion Euro in 21. This corresponds to a yearon-year growth rate of 6 percent for the entire market across all platforms. Besides the classic pay-tv platform from Sky Deutschland, the offers in the pay-tv area also include the fee-based programming platforms from cable providers such as Kabel Deutschland and Unitymedia or other TV-platforms like Entertain from Deutsche Telekom via the transmission path IPTV. Sources: Press release VPRT, January 17, 211, Press release BLM dated January 28, 211, article in the IT-Times from January 18, 211 Online In total, even online gross advertising revenues considerably climbed by nearly 35 percent to 2.35 billion Euro in 21 compared to the prior year. In particular, growth in advertising revenues in the area of moving images marketing was aboveaverage. However, conventional online media marketing still enjoyed by far the largest share. Overall, the price structure in the online segment remained relatively stable, which was partly due to the high demand in the premium moving image and mobile areas. Additionally, further shifts in the advertising budget in the direction of digital channels took place. Sources: Nielsen Advertising Statistics; Nielsen Media Research GmbH/ BVDW Interview on January 2, 21/HORIZONT IPTV In comparison to European neighboring states, Germany still accounts for lower user figures in the area of IPTV television. This is mainly due to the strongly fragmented German television 28

33 market with its marked free-tv culture and the strong market positions of the cable network operators. Nonetheless, the number of German households with television subscription via IPTV doubled in 29 according to a current study from PricewaterhouseCoopers (PwC). At the end of 29, the number of households with IPTV subscribers was more than one million. The key driver for the spreading of IPTV included attractive contents, flexibility, control over time, ease in handling and technical capabilities such as the so-called triple play (TV, Internet and telephony). Interactive add-on functions like the backward channel capacity that enables various interactive services such as video-on-demand and in particular new technologies like HD all pose important criteria for consumers according to the PwC Study. Beyond that, the topic of 3D gained further importance in 21: industry experts project that this technology will obtain great relevance on the market in the next three to five years. PwC projects that the number of IPTV subscribers in Germany will rise from 1.5 million in 21 to 2.9 million in 214. Based on this growth rate, the IPTV penetration in Germany would increase from 2.6 percent in 29 to 7.5 percent in 214. According to the study, the technical use via the distribution channel IPTV will significantly change in the coming four years: In 214 televisions will be consumed via corresponding IP-capable TV sets, because Internet and TV will coalesce. Source: Study German Entertainment and Media Outlook: , PricewaterhouseCoopers AG Wirtschaftsprüfungsgesellschaft Production services Despite the clear recovery of the TV advertising market and the associated higher TV advertising spendings, in 21, the production market was still marked by the general pressure from consolidation, prices and changes in the media industry especially in the area of pay-tv. This setting continues to be influenced on one hand by ongoing strong demand for digital and less expensive distribution channels, and on the other hand, for high-quality HD and 3D productions. According to the Gesellschaft für Unterhaltungsund Kommunikationselektronik (gfu) (German Association for Consumer and Communications Electronics), the share of HDTV equipment versus conventional televisions will rise to about 75 percent in 21. At the same time, the share of HD content and its distribution will also increase. Insofar, already 39 channels were being received in HD format in Germany by the end of 21*. Another important driver for this production sector is the topic of 3D. *Source: Experience and innovative competence were still competitive factors in 21, when it comes to switching to budget-releiving methods of production or new formats to be developed and implemented. Marketing Even in 21, the overall situation on the TV advertising market was still marked by condition-oriented business models and persistently high competiveness among the TV marketers. The TV marketer market in Germany predominantly consists of nine marketers and is dominated by the marketers of both of the largest broadcasting families ProSiebenSat.1 and the media group RTL Deutschland. SevenOne Media and IP Deutschland together, covered 75.6 percent of total TV gross advertising spendings in 21. Another 9.6 percent were covered by both of the public TV channels marketers. The online marketer market is significantly more fragmented. According to current marketer rankings of unique users of the Arbeitsgemeinschaft Online Forschung (AGOF) (Online Research Group, AGOF), 7 marketers are still represented. Hereof, the top four marketers in this ranking Interactive Media, Tomorrow Focus, SevenOne Media and United Internet Media covered about 48 percent of the total online gross advertising revenues in 21. Sources: Nielsen Advertising Statistics; Nielsen Media Research GmbH period: January - December 21 and ranking of marketers AGOF e.v./ internet facts 21-III The higher TV usage in 21 together with the economic recovery reflects the positive performance of the gross advertising revenues in 21. According to Nielsen Media Research, gross advertising spendings in television advertising climbed by 16.2 percent and even by 34.8 percent in the segment for online advertising. However, those gross advertising revenues presented by Nielsen are only an indicator of gross advertising, 29

34 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS dealing with special effects of advertising and is not to be equated with the real net advertising revenues. Sources: Nielsen Advertising Statistics; Nielsen Media Research GmbH; period: January December 29; January December Film Segment Theatrical production/rights acquisition 3D productions were by far the world's dominant trend in the cinema industry in 21. Film titles such as Alice in Wonderland, How to Train Your Dragon, Toy Story 3 or Rapunzel Tangled and not at least Constantin Film productions as Resident Evil: Afterlife successfully continued this trend, which was initiated by "Avatar". But two-dimensional film titles (among others, Inception, Sherlock Holmes, Sex and the City 2 and Harry Potter and the Deathly Hallows Part 1 ) were also enjoyed by the general public in the past year, resulting in an overall solid cinematic year in 21. Successful franchise films or adventures of famous comic heroes in 3D will therefore be high in course in 211 at the Hollywood Studios, too. In Germany, too, the enthusiasm for 3D titles was uninterrupted last year. However, there were only two German 3D productions that were very successful from the start: the Constantin Film in-house productions Resident Evil: Afterlife and Animals United, which both ranked first place among the German top films in 21 measured in terms of revenues. In order to create a sufficient number of theaters capable of showing 3D in the coming years, a quick decision was essential in the dispute over the Film Funding Act (FFG). Since the cinema chains, UCI, CineStar and Cinemaxx, temporarily stopped paying their contributions in full to the German Federal Film Board (FFA), subject to provisional legal protection, on February 23, 211, the Federal Administrative Court in Leipzig declared the FFG to be legal. To this end, the continuation of this important funding element is secured for the German Film sector. The decision will have a positive impact to the entire German film landscape, as the payout of reference and promotion funds is essential for production activities and the further digitization of films. Source: Market Statistics Germany 21, January 4, 21 to January 2, 211 from Rentrak EDI, report published in January 211 TV service production Just as rapidly as the downslide hit after the banking crisis in autumn 28, the advertising market recovered just as quickly in 21. In its upwards-corrected November forecast of 4 percent for the total TV net advertising market, the Association of Private Broadcasting and Telemedia (VPRT) was predicting a 6 percent growth in advertising revenues. We assume that the higher advertising revenues from TV stations will be reflected in an upturn in the area of service productions in the near future. A total of about 3 billion Euro is spent on TV productions every year in Germany. Approximately one-quarter of this production volume falls to the private broadcasters, ProSieben, SAT.1 and RTL; whereas about two-thirds thereof is ordered by the public broadcasters ARD and ZDF. Source: VPRT e.v. (premise: Expert survey, last updated in November 21) Theatrical distribution The number of audiences in the world's largest cinema market the USA dropped by 5.4 percent in the past year. In contrast, revenues of 1.51 billion US dollar almost matched the prior year's level (1.54 billion US dollar) due to the higher ticket prices for 3D film titles. This enabled the American film industry to break the two-digit billion mark for the second consecutive time. Source: Rentrak EDI and the article The US Box Office Year from Blickpunkt: Film, January 14, 211 Quite the opposite: the German film industry cannot be satisfied with the yearly figures for 21. According to analyses by the German Federal Film Board, the number of moviegoers fell significantly by 13.5 percent to million viewers (prior year: million). This decrease is almost entirely due to the loss in viewers for German productions. German films only reached a total of 2.9 million viewers or about half of the prior year's audience figure (39.9 million). The market share of domestic productions correspondingly declined from 27.4 percent to 16.8 percent. The fact that the sales figures only fell in relative terms, is largely due to the surcharges for 3D tickets. In total, the industry generated revenues of 92.4 million Euro in 21 and thus 5.7 percent less than the year before (976.1 million Euro). Source: FFA info, Issue 1/11, published on February 9, 211 3

35 The most successful hit at the German theaters was the science-fiction adventure Avatar, released in December 29, attracting a total of 11.2 million viewers and generating revenues of more than 114 million Euro. The number two spot was secured by Harry Potter 7 with an audience of 5.2 million. The most successful German production was the comedy Friendship! with approximately 1.5 million visitors, followed closely by the Constantin Film CGI production Animals United with more than 1.4 million viewers. Whereas, the international Constantin Film production Resident Evil: Afterlife with revenues of about 11.6 million Euro brought in the highest revenues from a German film. Source: Market Statistics Germany 21, January 1, 21 to January 2, 211 from Rentrak EDI, report published in January 211 Home Entertainment Blu-ray remains on growth track By far the largest Home Entertainment markets are in the USA and Great Britain. The British Home Entertainment providers realized total sales of approximately three billion Euro in 21; thus, holding the prior year's level. Losses in the DVD area were compensated by significant growth in the Blu-ray business (+55 percent of sales turnover) and from purchased downloads (+123 percent of sales). The US market again recorded a sales minus of 3.3 percent to 18.8 billion US dollar; however, total revenues from Blu-ray sales climbed by 53 percent to 2.3 billion US dollar. Same applies in the area of digital distribution (video-on-demand and electronic sell-through), which posted higher sales by 19 percent to 2.5 billion US dollar. With a further decline in the double-digit percentage range (-11.4 percent), the DVD segment remained the problem child of the industry. Source: Blickpunkt: Film 4/11, page 33 "Licht am Horizont" Market penetration of the High Definition format continued to grow significantly in Germany in the past year. According to the German market research company Gesellschaft für Konsumforschung (GfK) (Society for Consumer Research, GfK), 12 million Blu-ray discs were sold in the reporting year, almost doubling year-on-year (6.2 million). Which means that every tenth disc sold was a Blu-ray disc. However, an additional substantial price drop by an average of 3.11 Euro to 16.3 Euro resulted in increasing revenues from the sale of Blu-ray discs by only 62 percent to 193 million Euro (prior year: 119 million Euro). Total sales in the German Home Entertainment industry stood at 1.67 billion Euro, up nearly 1 percent over the prior year's very high level (1.65 billion Euro). The DVD sell-through market, which posted a slight gain in 29, had to put up with revenue losses of almost 6 percent to 1.19 billion Euro in 21 (prior year: 1.26 billion Euro). The minus was caused on one hand from a drop in the quantity of units sold from 16.6 million to 13.5 million DVDs and on the other from another slight drop in the average selling price from 11.8 Euro to Euro. In contrast the electronic sell-through market had a pleasing development the electronic sell-through market is a distribution model in which films are no longer offered as physical discs, but as data that can be downloaded on a personal computer. Revenues from this sell-through segment virtually tripled within one year rocketing from 8 million Euro (29) to 22 million Euro (21); this means that nearly 2 percent of all film content meanwhile sold has been acquired in a purely digital form. Source: GfK Consumer Panel Video sell-through market and Video on Demand, Pay per View, Electronic Sell-Through, December 21 Downturn in rental business slows down With a sales volume of 264 million Euro, revenues at German video sell-through were only slightly below the 29 figure (269 million Euro) a considerable improvement against the losses in prior years. Thereby the positive development in the digital rental business (video-on-demand and pay-per-view) had an invigorating effect, with sales climbing by 13 million Euro to 21 million Euro (+61 percent). As a consequence, nearly one in every twelve sales-euro is now generated from rentals in the online business. Revenues from renting physical discs either at video rental stores, at automats or per mail were down another 5 percent to 243 million Euro (prior year: 256 million Euro). A significant sales increase (+6 percent to 24 million Euro) in the Blu-ray segment was not sufficient to offset the decline in the DVD business area (-23 million Euro). The main problem of traditional video stores is the continuing loss of customers. After 31

36 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS the number of renters had already fallen to 7.8 million in 29, it again fell by more than 5 percent to 7.4 million in 21. Source: GfK Consumer Panel Video rental market and Video on Demand, Pay per View, Electronic Sell-Through, December 21 License trading/tv exploitation The future of television in the digital age was much discussed in recent years. Contrary to the popular thesis that television has no future and is facing its demise, its market position is currently still very good. However, the announcements made by Internet and technology companies (among others, Google and Apple) about entering the television market are being given a great deal of attention. Whether these business models will be verified remains to be seen. Whereas in the last ten years TV use of traditional, linear television in Europe has risen steadily, viewers can today decide when and where to watch programming content as they become more and more exposed to digitization due to new usage forms such as the digital video recorder, on-demand platforms or mobile applications. Consequently, a shift from linear use, which is tied to a fixed program schedule, towards non-linear use of TV content is already noticeable. For this purpose TV broadcasters are already offering interesting call-up platforms. One of the central tasks of TV broadcasters in the future will be the development of sustainably profitable business models due to the rising demand in viewers for example on-demand offerings. That is why the acquisition of TV rights in high-quality films remains an integral component of their programming line-up. On one hand, Films can be offered via demand portals and make a major contribution in raising the attractiveness of the TV programming on the other; thereby creating an alternative in the future to the offers being made by Internet companies Sports- and Event-Marketing Segment Sports sponsorship und TV sales As described previously, the 21 business year was characterized by a strong recovery in the media markets, whereby the pay-tv market in particular continued to expand. Global growth was driven by the ongoing digitization of cable networks, the launch of pay-tv offerings in newly rolled-out digital terrestrial networks, the ongoing introduction of IPTV services and a growing middle class in emerging markets. Premium sports rights increasingly important to broadcasters The rapid recovery in the TV advertising market considerably improved the TV channels financial status, thus contributing to the affordability of acquiring sports rights. Even though competition in the broadcast sector continues to increase, as new entrants from previously distinct market sectors overlap with programming content, in many cases these new entrants are interested observers rather than active bidders for premium sports rights for the time being. However, the structural changes to the media market, driven by digitization, increased channel offerings and alternative consumption platforms, are creating positive conditions for premium sports rights. As some of the most desirable, ad-friendly audience groups fragment across an increasing number of channels or move to online and to on-demand offerings, it becomes more challenging for broadcasters and advertisers to reach the young, affluent mass audiences needed to drive revenues. As a result, premium live sports rights such as the UEFA Champions League and the UEFA Europa League are becoming increasingly important content offerings for broadcasters seeking to adress these valuable audiences. Sports sponsorship return to growth In 29, sports sponsorship suffered a slight setback as a result of the difficult macroeconomic environment. However in 21, according to the consultancy specialist IEG, global sponsorship spendings grew by 5.2 percent to some 46.3 billion US dollar, reflecting continued confidence in the effectiveness of sports sponsorship. Source: IEG, London 21 Thus, sponsorship rights for premium sports events have continued to perform pleasantly, in terms of delivering valuable communication platforms for sponsors, and therefore also in terms of delivering increased rights fees for rights-owners. 32

37 1.11 Business performance of the Group Segments Sports Segment Free-TV SPORT1's top priorities in 21 were the introduction of the new multimedia umbrella brand SPORT1 for all of the TV, online and mobile activities within the Sports Segment, the related content convergence and the corporate consolidation of the platforms. The launch of SPORT1 was particularly associated with massive programming changes: To this end, SPORT1 broadcast over 1,265 hours of live sports in the past year more than 18 percent versus 29. Furthermore, extensive Investments in new rights were also undertaken. Alongside the growth in live sports, the news offerings were significantly broadened in the year under review and about 2 new Sportainment-formats, documentaries, motor magazines and formats with strong focus on soccer were included in the programming line-up for a volume of more than 28 hours. The focus in the second half of the year was particularly on opening up new distribution platforms to broadcast SPORT1 HD and the pay- TV channel SPORT1+. The 21 annual market shares of SPORT1 stood at.8 percent of viewers overall (viewers aged 3+) and 1.4 percent of the core target group of males aged 14 to 49 years, which was slightly behind the prior year's level (29:.9 percent aged 3+; 1.5 percent males 14-49). The Ice Hockey World Championship was very successful for SPORT1 in the reporting year the audience-pulling tournament provided the channel with an outstanding coverage of up to 3.9 million at the top for the 2 nd semi-final between Russia and Germany (market share of up to 16.8 percent viewers aged 3+ and 29.2 percent in the core target group) in the second quarter. SPORT1 therefore generated the best coverage since May 27. The broadcasting right to qualification matches of the UEFA Europa League paid-off: With the live coverage of the return match between VfB Stuttgart and SK Slovan Bratislava, SPORT1 reached an average of 1.3 million viewers and 2.4 million at the top. The Monday live match of the 2 nd Bundesliga were even more successful with FC St. Pauli vs. FC Augsburg bringing in an average of 1.4 million viewers. Also the constant ratings guarantor Doppelpass Die Krombacher- Runde also achieved an average of up to 1.2 million viewers in 21. In the non-soccer area, SPORT1 also scored, among others, with the live broadcasting of the Men's Handball European Championship in January (up to a high of 1.3 million SPORT1 Doppelpass Die Krombacher-Runde April 11, 21 33

38 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS viewers; market share of 3.7 percent viewers aged 3+ and 4.4 percent in the target group of males 14 to 49 years) and the reporting on the MotoGP (up to an average of.78 million viewers). Source: AGF/GfK Television research (TV scope) components of the programming line-up of SPORT1+. In motorsports, SPORT1+ transmits, among others, the Motorcycle World Championship MotoGP, the FIM Speedway or the 24- hour racing on the Nürburgring live. In this year SPORT1+ will also be broadcasting the 211 Basketball European Championship and the 211 Ice Hockey World Championship. Motorcycle World Championship MotoGP NFL match Green Bay Packers vs. Arizona Cardinals Pay-TV The second half of 21 focused on implementing the technical and editorial infrastructure as well as acquiring rights to expand the programming portfolio for the new pay-tv channel SPORT1+. Alongside the live broadcasting rights to the US professional football league NFL for the 21/211 and 211/212 seasons (including the Super Bowl and Pro Bowl), SPORT1+ also had European top soccer in their line-up with the live matches of the English FA Cup and Carling Cup competitions, the French Soccer Cup and the Italian Coppa Italia. Additionally, the pay-tv channel broadcasts live and exclusively 85 games of the TOYOTA Handball Bundesliga as well as selected games of the Beko Basketball Bundesliga. Even the Turkish Airlines Euroleague, Europe's most important Basketball Club competition, and the CEV Volleyball Champions League are integral Online SPORT1.de continued with the positive coverage development of users from 29, recording new record user figures in the year under review. Compared with the preceding year, the number of visits were up 19 percent to an average of 29.1 million, with page impressions (PIs) climbing by 49 percent to an average of 245 million. It is worth highlighting the figures registered in April, May and June 21 the sports portal recorded new monthly top coverage rates three consecutive times. This development is foremost due to the contextual convergence of TV, online and mobile undertaken as part of the one-brand strategy. The reporting on the Olympic Games, the Ice Hockey World Championship, the Soccer Bundesliga, the UEFA Champions League and the 21 FIFA World Cup caused growing interest in SPORT1.de. Other factors included the expansion and optimum positioning of multimedia contents and interactive features. 34

39 The very solid ratings are also reflected in the 21 quarterly Internet marketing report "internet facts" from AGOF (Arbeitsgemeinschaft Online Forschung). Following the very good start into 21, SPORT1.de succeeded in generating a new top rate in unique users in the second quarter. During the period from April through June, an average of 3.4 million unique users visited the online platform 9, more unique users than in the first quarter of 21 and thus bestowing SPORT1.de the market leadership among the German sports portals in the second quarter 21. This above average high rating could not be achieved in the third quarter 21, which recorded an average of 2.9 million unique users, but SPORT1.de can nevertheless look back on a very encouraging development in the unique user figures in the past year. Due to the implemented changes in the survey methods of unique user figures by the AGOF in the first quarter 21, the figures for the second and third quarters 21 are not comparable with those figures issued by the AGOF for the respective quarters prior year. Source: AGOF internet facts, 21-II (April June 21), 21-III (July September 21) SPORT1.de also posted a successful rating performance in the fourth quarter 21: With the reporting on the season final of Formula One and the start of NBA and the Basketball Bundesliga, SPORT1.de generated an average of 28.4 million visits and million page impressions (PIs), according to IVW, up 13 percent for visits and even 48 percent for PIs over the same period last year. In the area of mobile, SPORT1 also significantly raised the ratings with the ongoing expansion of the very successful SPORT1 iphone-app as well as the launch of the ipad-app. At year-end, the SPORT1 iphone-app registered approximately 68, downloads. According to AGOF's market media study "mobile facts 21", the SPORT1-App ranked among the top 2 mobile Apps, reaching an average of 167, unique mobile users per month during the survey period. Source: IVW Online-Usage data 21/AGOF internet facts 21-III/ AGOF mobile facts 21 IPTV After the successful set-up and implementation phase of the new Bundesliga live channel LIGA total! in 29, LIGA total! kicked-off in January 21 with the return matches of the Soccer Bundesliga 29/21 season as usual with the broadcasting of all games of the Bundesliga and the 2 nd Bundesliga LIGA total! Spieltaganalyse Thomas Strunz, Matthias Opdenhövel and Fredi Bobic 35

40 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS live and in conference feed as well as the extensive highlights of the individual matches. The 1 st Liga matches and the corresponding conference feeds were aired completely in HD and presented in a studio, fully equipped with HD technology. In addition to live reporting, the viewers can also choose among a number of technical features and for example can call-up all matches and highlights in the TV archive regardless of the time and via LIGA total! Interaktiv the live ticker of all matches, flash tables, live scores, stats or game scenes, at any time. All matches of the Bundesliga and the 2 nd Bundesliga, including the conference feeds, are also available live via the mobile devices and smartphones like the iphone. With the start of the second half of the 29/21 season, the new format LIGA total! Spieltaganalyse was launched on the 18 th matchday. The format broadcast in the free-tv usually follows the 2 nd Bundesliga live match on Mondays, offers a detailed retrospect at the past matchday. Subsequent to the successful completion of the first Bundesliga season on LIGA total!, the third quarter focused on the preparations for the kick-off of the new season 21/211. Since the start of the 21/211 season LIGA total! is presenting a worldwide innovation with the Personal Conference : via a simple menu LIGA total! clients can combine their own personal conference of their preferred matches from all parallel games. Production services On February 23, 21, PLAZAMEDIA produced the Champions League match VfB Stuttgart vs. FC Barcelona in Stuttgart for Sky Deutschland in the seminal 3D format. Furthermore, Sky Deutschland commissioned a second HD sports channel in the first quarter 21. The opening match of the Ice Hockey World Championship in Germany was yet another 3D-production highlight for PLAZA- MEDIA. In addition to the opening game in 3D/HD for LIGA total!, PLAZAMEDIA also produced the entire Ice Hockey World Championship (May 7 to 23) for SPORT1. LIGA total! Personal Conference Opening match Ice Hockey World Championship Germany vs. USA During the FIFA World Cup in South Africa, PLAZAMEDIA assumed the live-streaming of all the soccer matches for Deutsche Telekom's mobile devices, in particular for applications on the iphone, and produced a 24-hour channel with World Cup highlights and news. For the pay-tv broadcaster Sky, PLAZAMEDIA created the studio format, all 64 matches 36

41 and also the conference feed during the last match days of the groups. In addition, the live streamings of all the World Cup matches as well as the daily highlights of the studio format and the World Cup matches were realized for Moreover, PLAZAMEDIA produced all 64 matches for sky.de live on the Internet for the ipad. And finally, for the host broadcaster HBS at the International Broadcasting Center in Johannesburg, PLAZAMEDIA produced all World Cup contents in eleven languages, which were offered world-wide by mobile service providers on their mobile devices. platform marketing strategy with a well-known partner in tandem with the start-up of its business activities. Since the start of the 21/211 season in the third quarter, PLAZAMEDIA has been producing the conferences of the Bundesliga and the UEFA Champions League and the corresponding studio broadcasts from the new HD production control room for all soccer formats as well as the new sports show Samstag LIVE! in full HD standard for Sky. Alongside the production-related handling of the already existing six 24-hour SD channels, PLAZAMEDIA is also responsible on behalf of Sky as well for the implementation of HD sports channel Sky Sport HD2 since the third quarter 21. Furthermore, all live contents and highlights of the Bundesliga, the DFB Cup, the UEFA Champions League, the UEFA Europa League and the English Premier League are encoded and streamed in four quality levels for the ipad, since the beginning of the 21 season. On behalf of the international sports marketing agency, Infront Sports & Media AG, Zug/Switzerland, PLAZAMEDIA Swiss AG produced four qualification matches for the UEFA EURO 212 in September 21 another five matches PLAZA- MEDIA will produce in 211. Finally, PLAZAMEDIA produced the Universum Boxing Event in 3D and HD early in December 21 as part of a co-operation between SPORT1, Deutsche Telekom AG, HD+ /ASTRA and the Polish pay-tv provider "n", a HD-DTH platform of the TVN group. Marketing After Constantin Sport Marketing GmbH had commenced its operations in the third quarter 21, the centralized marketer succeeded in winning Mercedes Benz as the presenting partner for TV, teletext, online and mobile at the 2 nd Laureus Charity Soccer Match; thereby implementing its integrated and cross- Mercedes Benz Presenting partner 2 nd. Laureus Charity Soccer Match At the beginning of the 21/211 Bundesliga season, all relevant sponsoring partnerships, among others, the co-operation with Doppelpass die Krombacher Runde, Hattrick die 2. Liga or "Bundesliga Pur" were carried forward and expanded in part. Since November 21, Constantin Sport Marketing along with IP Deutschland, SevenOne Media, EL CARTEL MEDIA, VIA- COM Brand Solutions and DISCOVERY NETWORKS Deutschland has been the sixth marketer in the group of organizers of TV-Wirkungstag. In total, the marketers represents 16 TV channels and thus roughly 9 percent of the TV advertising market. They operate in common for the generic marketing of the advertising medium television. This especially comprise the organization and execution of the annual TV-Wirkungstag. In December 21, Constantin Sport Marketing presented its marketing portfolio to all major media agencies and media networks in a roadshow. At the same time, negotiations began for the annual agreements for

42 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS The Three Musketeers Film Segment Theatrical production/rights acquisition Given the competitive market, Constantin Film AG is pursuing the strategy of producing fewer films in the future, but focusing on complex 3D productions, films with event-character, family entertainment productions and bestseller adaptations. Consequently, 21 began with the shooting of only five in-house and co-productions a significant reduction by ten projects compared to 29. all countries at the Film Market in Cannes, will be released at the beginning of September 211. In mid-july 21 the first take was made for Vorstadtkrokodile 3, which is the third and final adventure of the famous gang of youths. The film is being produced by the Constantin majority holding, Rat Pack Filmproduktion, and Westside Filmproduktion. Vorstadtkrokodile 3 is shown successfully in German cinemas since mid-january 211. Shooting for the complex 3D production The Three Musketeers took place from the end of August until the middle of November 21. The new adaptation of the famous literary classic from Alexandre Dumas has an all-star cast with, among others, Logan Lerman, Matthew MacFadyen, Orlando Bloom, Milla Jovovich and Oscar winner Christoph Waltz. The cloakand-dagger adventure, which was successfully sold in nearly Wickie Auf großer Fahrt in 3D 38

43 The new adventures of the clever young Viking boy Wickie ( Wickie Auf großer Fahrt ), also produced in 3D, was filmed by the Rat Pack Filmproduktion from the end of August until the middle of December. The film is scheduled for release in Germany at the end of September 211. In the area of licensed productions, Constantin Film acquired the German exploitation rights to the French hit La Rafle ( The Children from Paris ), which was released to German cinemas in mid-february 211. Constantin Film also secured the German exploitation rights for the US comedy LOL: Laughing Out Loud, featuring teen star Miley Cyrus and Demi Moore, and the action-packed fantasy epic War of Gods. As of yet, there are no German release dates slated for these two films. In addition, Constantin Film AG acquired the German exploitation rights for several very promising films at the American Film Market (AFM). The extravagant production of Walking with Dinosaurs 3D, which tells the life's story of a dinosaur, ranks first. The production began in October 21 and is scheduled for release at the end of 213. In December 21, shooting started on the action-comedy So Undercover starring Miley Cyrus, which is slated to hit the theaters this year. Step Up 4 3D, the fourth sequel to the successful franchise is also in the pipeline. Production is planned for March 211; the film is scheduled for release at the beginning of 212. TV service production Compared to 29, fewer projects were realized in the TV service production area in the reporting year, due to the persistent savings measures undertaken by television broadcasters, how-ever, some pleasing viewer ratings were achieved with topquality productions. In this way, for example, the two-part series Whiteout based on the bestselling novel by Ken Follett, and broadcast by ZDF in January attracted 1.43 million viewers and scored a market share of up to 1.3 percent in the advertising-relevant target group of 14 to 49 year-olds. The third episode in the Johannes Mario Simmel series Liebe ist nur ein Wort aired on ZDF in March and generated an audience of 4.34 million with a market share of 13.3 percent in the advertising-relevant target group. Whiteout The event-action-thriller Der große Stromausfall, a production of Constantin Television GmbH, aired on SAT.1 at the end of November, achieved a solid market share of 11.4 percent in the 14 to 49 target group. The pilot film for the action-crime series Die Draufgänger, featuring Jörg Schüttauf and Dominic Boeer, was shown on RTL in mid-december 21, capturing a very good market share of 18.6 percent in the 14 to 49 target group. Since the start of September 21, Polyscreen Produktionsgesellschaft für Film und Fernsehen mbh has been producing the fourth season of the award-winning daily show Dahoam is Dahoam. This format has been running very successfully in the early evening time slot for Bayerische Rundfunk since 27 and has since then been generating constantly high market shares. The Constantin subsidiary Olga Film had a new episode of the popular ZDF crime series Kommissarin Lucas in post-production at the end of 21. Another episode is currently in process and is slated for shooting to begin in April 211. In the TV-Entertainment area, too, the ongoing savings course by TV broadcasters in 21 still impacted Constantin Entertainment GmbH's production volume despite the recovery of 39

44 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS Animals United the advertising market. In this way, for example, the broadcast of fourth season of the SAT.1 event show Die Comedy-Falle in March achieved a solid average market share of 12.9 percent in the advertising-relevant target group. The prime-time show Der Comedy Olymp, which ran early in January 21 on RTL, even drew top ratings of 22. percent of viewers between 14 and 49. The court show Richter Alexander Hold (now in its ninth season) is still a long runner on SAT.1 and reached an average market share of up to 14.5 percent. Sources: Ratings of AGF/GfK Television research (TV scope daily) The Constantin Entertainment group's productions in other European countries in the fourth quarter 21 included the third season of the successful Croatian casting show Hrvatska Trazi Zvijezdu (Croatia's next Superstar), which aired at the end of February 211. Moreover, the second season of the cooking show Kuchenne Rewolucje (a Polish version of the international hit format Kitchen Nightmares ) as well as the new reality-documentary Sunshine Girls, realized by Constantin Entertainment Hellas for Alpha TV, were under production. Theatrical distribution In the reporting year, Constantin Film AG distributed 14 films (11 in-house and co-productions and three films under license) to German cinemas. Four of these films hurdled the magical million mark of total viewers. In addition, every second film, ranking among the Top 1 most popular German films of 21 based on audience response was produced and released by Constantin Film AG. With these again impressive results, Constantin Film AG secured a market share of 6.9 percent of total admissions and 6.8 percent of total sales. The most successful Constantin film of the year was the CGI co-production Animals United the first German animated film in 3D. Released early in October 21, this screen adaptation of the Erich Kästner classic had fascinated more than 1.4 million viewers by the end of the year, of which 54 percent enjoyed the film in 3D. As a result, Animals United brought in approximately 1.4 million Euro in Germany alone. Regarding sales, the international Constantin Film co-production Resident Evil: Afterlife scored even better with 11.6 million Euro in Germany and dominated the top of the charts for the year. The fourth episode of the Resident Evil series, fully filmed and cut in 3D for the first time, attracted an audience of more than 1.1 million (thereof 96 percent represented 3D-viewings) at German theaters, thus providing Constantin Film AG with one 4

45 of the biggest international releases in its history. It was already the number one film around the world on its opening weekend, almost tripling the earnings of its predecessor Resident Evil: Extinction. In total, Resident Evil: Afterlife recorded a global box office of approximately 3 million US dollar. Home Entertainment The Highlight Communications group maintained its market position in the German-speaking region quite well with top-class first releases and a number of successful second utilizations. Together with its distribution partner in Germany, Paramount Home Entertainment, the market share in the sell-through market remained stable at 9 percent. In the rental market, the joint market share was 1 percent versus 12 percent the year before. Source: GfK Consumer Panel Video sell-through market and Video rental market 21 The high-selling new release of the Michael Bully Herbig comedy Wickie und die starken Männer hit the market already in March 21. With a total of 645, DVDs and Blu-rays sold by the end of the year, this adaptation of the popular cartoon series became the second most successful independent production of the year, and seized the 9 th slot in the German sell-through charts. Beyond that, Wickie was awarded the Video Champion 21 industry prize as the best production in the category of German Films. Maria, ihm schmeckt s nicht! Resident Evil: Afterlife The licensed title Step Up 3D produced quite pleasing results. Following its release at the end of August 21, the third part of the successful dance series directly took the lead of the German film charts, thrilling more than one million moviegoers (thereof 93 percent represented 3D-viewings). Very close behind was the tragic-comedy road movie vincent will meer. The production of the Constantin subsidiary Olga Film was an absolute surprise hit with about one million viewers. Sources: Market Statistics Germany 21, January 4, 21 to January 2, 211 from Rentrak EDI, report/january 211 A comparable sales success story also occurred with the international Constantin co-production Pope Joan. After the historical epic, starring Johanna Wokalek, had attracted an audience of more than 2.3 million moviegoers in 29, the Home Entertainment version has sold 37, units since its release date early in March. Quite pleasing results were also delivered by the temperamental culture-clash comedy Maria, ihm schmeckt s nicht!, with 25, units sold. Further 41

46 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT BUSINESS AND GENERAL CONDITIONS highlights among the 21 Home Entertainment line-up were the turbulent road movie vincent will meer, the youth adventure Vorstadtkrokodile 2 and the action-packed licensed titles Gesetz der Rache, Centurion" and "Solomon Kane. License trading/tv exploitation With its high-qualitiy film library, Constantin Film AG is an interesting partner for the major German TV channels, still enjoying close contacts. Major sources of revenues came from the licensing of free-tv rights for films like Fantastic Four Rise of the Silver Surfer, Resident Evil: Extinction, Asterix bei den Olympischen Spielen, Der Wixxer, Hui Buh Das Schlossgespenst and Kirschblüten Hanami. Films licensed for pay-tv included among others the rights to Maria, ihm schmeckt s nicht!, Freche Mädchen, Männersache, Defiance and The Women Sports- and Event-Marketing Segment Sports sponsorship und TV sales Successful renewal of TEAM s agency mandates The Highlight Communications subsidiary TEAM successfully extended its mandate with UEFA for the marketing of the commercial rights for both of the UEFA s leading club soccer competitions. In March 21, the UEFA and TEAM concluded a new agency agreement, in which UEFA appointed TEAM to further market the commercial rights for the UEFA Champions League, the UEFA Europa League and the UEFA Super Cup, initially for the seasons 212/213 until 214/215 and, subject to achieving certain contractual performance targets, for an additional term lasting until at least June 218. Winner of UEFA Champions League: FC Internazionale Milano At the same time, TEAM managed the extensive preparations for the commercial handling of the finals of Europe s two leading club soccer competitions. The first final of the new UEFA Europa League was played in Hamburg between Fulham FC and Atletico Madrid. The prestigious UEFA Champions League final was played at the famous Santiago Bernabeu Stadium in Madrid. FC Bayern München and FC Internazionale Milan battled for the title of the best team in Europe. Furthermore, TEAM successfully concluded a new agency agreement with the Vienna Philharmonic Orchestra. TEAM s mandate to market the Orchestra s main TV and sponsorship rights was extended for an additional five-year term until 217. First-class operational handling in the soccer sector In operational terms, the initial focus was on the successful handling of the knock-out phases of the UEFA Champions League and UEFA Europa League in the 29/21 season. During this Road to the Final stage of the competitions, 88 matches were delivered with TEAM s usual reliability and professionalism with clubs such as Manchester United FC, FC Barcelona and AC Milan (UEFA Champions League) and Ajax Amsterdam, Juventus Turin and Werder Bremen (UEFA Europa League). Then, TEAM also once again managed the commercial handling of the UEFA Super Cup, which was played at the end of August in Monaco between current UEFA Champions League winner, FC Internazionale Milan, and the UEFA Europa League winner, Atletico Madrid. As in the previous years, the UEFA Super Cup and other Monaco week events marked the kickoff of the new European club soccer season. After the UEFA Super Cup, TEAM shifted attention to the group stages of the UEFA Champions League and UEFA Europa League for the 21/211 season. Between August and December 21, a total of 26 matches were successfully handled by TEAM throughout Europe. 42

47 RESULTS OF OPERATIONS, FINANCIAL AND NET ASSETS POSITIONS OF THE CONSTANTIN MEDIEN GROUP COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT Strong start into the new UEFA sales cycle After the extension of TEAM s mandate with UEFA, the focus was shifted to the start of the marketing process for TV and sponsorship rights (seasons 212/213, 213/14 and 214/215), which started in the fourth quarter 21 after extensive preparations. Early results have been very positive despite the difficult economic and market conditions. Deals have already been concluded for the new rights cycle with major broadcasters such as Sky Italia, Mediaset, Fox USA and Al Jazeera. These strong results illustrate once again the commercial strength of these UEFA competitions. Furthermore, they underscore that the long-standing experience and expertise enables TEAM to achieve the best possible sales results. Vienna Philharmonic Orchestra Summer Night Concert Schönbrunn Palace Music sponsorship and TV sales Successful music projects There was a sustainable performance by TEAM s music division in relation to the sales of TV and sponsorship rights for its music projects. On the one hand the exclusive partnership between the Vienna Philharmonic Orchestra and Rolex, initiated by TEAM, successfully continued for its second year. On the other hand, the sponsorship rights for the Eurovision Song Contest were once again sold-out, with major brands such as Telenor and Nivea seizing the opportunity to associate with this highly popular event. On the operational side, the initial focus of TEAM s music division was the 21 New Year's Concert of the Vienna Philharmonic Orchestra, led by French conductor Georges Prêtre for the second time. About 45 million people in 72 countries around the world followed the performance on a live or delayed basis. This international coverage again underlines the value of the New Year's Concert as the worldwide leading music event in the classical genre. The Eurovision Song Contest 21 took place in Oslo from May 25 (first semi-final) to May 29 (final). 39 countries took part in the contest, the 55 th staging of the most important popularmusic event in Europe. With 18, people in attendance, the event hall was completely sold-out, and the live broadcast of the eagerly-awaited final again generated out standing TV ratings in many countries. In the winning country of Germany alone, up to 14.7 million viewers watched the event, corresponding to a market share of 49.1 percent of total viewers and 61.4 percent of viewers aged 14 to 49. In total, over 15 million TV viewers tuned-in around the world. Source: EBU, Mediametrie, May 25-29, 21 The second musical highlight of the summer the Summer Night Concert of the Vienna Philharmonic Orchestra, conducted by Franz Welser-Möst, took place on June 8, 21. This openair event in the unique ambiance of Schönbrunn Palace not alone fascinated the 1, people on site, but also the many fans of classical music in front of their TVs in over 6 countries. 2 Results of operations, financial and net assets positions of the Constantin Medien Group 2.1 Financial accounting and reporting standards Constantin Medien AG prepares its consolidated financial statements in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU. The consolidated financial statements have been supplemented by additional notes and by the Group Management Report. The accompanying combined Group Management Report and the Management Report of Constantin Medien AG has been prepared in accordance with 315 HGB and agrees with the requirements 43

48 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RESULTS OF OPERATIONS, FINANCIAL AND NET ASSETS POSITIONS OF THE CONSTANTIN MEDIEN GROUP and recommendations of the German Accounting Standard No. 15 (DRS 15) issued by the German Accounting Standards Committee e.v. 2.2 Overall assessment of the reporting period The Constantin Medien Group's business performance in 21 was slightly better than expected at last. increased by 4.8 million Euro to 6.2 million Euro versus the financial year 29 (1.4 million Euro). The Sports- and Event-Marketing Segment, in particular, contributed to the earnings improvement. The profit from operations contains special expenses for acquisition-related PPA-amortization and impairment charges of 21.4 million Euro (29: 49.7 million Euro). In the reporting period, sales amounted to 47.3 million Euro and slightly exceeded the revenue target of 44 million Euro to 46 million Euro. Compared with the prior year (511.1 million Euro), this translates into a decline of 8. percent, which reflects the anticipated weaker sales performance of the Sports Segment and the Film Segment. Profit from operations (EBIT) of the Constantin Medien Group Earnings attributable to shareholders amounted to million Euro in 21 compared to 8.7 million Euro in the prior year. This corresponds to a slight improvement over the projected range of -12 million Euro to -14 million Euro. The decrease in earnings attributable to shareholders primarily resulted from the special items recognized in the Others division in the preceding year. Others recorded net earnings of 48.3 million Euro from the settlement agreements with the D&O insurers in the previous year. 2.3 Segment performance SEGMENT PERFORMANCE 21 in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Change Sales Sports Film Sports- and Event-Marketing Others Total sales 156, ,25 72,944 47, , ,64 61, ,66-12,24-39,859 11,19-4,774 Segment result Sports Film Sports- and Event-Marketing Others Total segment result ,12 7,22-5,737 6,18-14,84-2,83 2,248 34,82 1,425 14,525 25,815 4,972-4,557 4,755 In 21, the Sports Segment achieved sales of million Euro or 7.2 percent below the prior year's figure (168.2 million Euro). The sales performance still reflects the condition-oriented business models and ongoing fierce competition in the TV advertising market primarily for smaller TV stations. Additionally, persistent cost awareness of the customers and the ongoing price and margin pressure in the production market had an impact. Furthermore, the sales performance was affected by the absence of those companies sold in 29, especially Creation Club (CC) GmbH. The revenues from the IPTV sector (Bundesliga channel LIGA total!) had an opposite effect, because they had been included for the first time starting at the beginning of last year's third quarter. Segment earnings for 21 stood at -.3 million Euro, which 44

49 was in line with expectations. Compared to the segment earnings in the preceding year of million Euro, this computed into an improvement of 14.5 million Euro. The segment's restructuring measures implemented in mid-29 were completed in the third quarter 21. In 21, the Film Segment posted sales of million Euro, down 14.2 percent on the previous year (281.1 million Euro). The drop, which was within expectations, is mainly due to a lower production volume in TV service productions and to lower sales from theatrical distribution and license trading. Segment earnings totaled 5. million Euro following -2.8 million Euro the year before. Segment earnings include PPArelated scheduled amortization of 2.9 million Euro (29: 7.1 million Euro) and impairment charges of.7 million Euro (29: 26.3 million Euro). The decline in PPA-amortization relates on one hand to lower amortization expenses on PPAadjustments to film assets. On the other hand, the previous year's amount included PPA-amortization expenses related to the service productions of a Constantin Film subsidiary and to impairment charges to the brand name Constantin. Adjusted for these effects, segment earnings amounted to 8.6 million Euro (29: 12.6 million Euro). The Sports- and Event-Marketing Segment records sales of 73. million Euro in 21. The increase of 18.1 percent versus 29 (61.8 million Euro) mostly related to higher marketing revenues from the UEFA Champions League and the UEFA Europa League. Segment earnings came in at 7.2 million Euro, which were significantly above the prior year's figure (2.2 million Euro). The increase of 5. million Euro is partly due to the change in presentation of the UEFA's profit share in Team Holding AG, which was included until June 3, 21. The segment earnings include scheduled PPA-amortization of 17.7 million Euro (29: 16.2 million Euro) and goodwill impairment charges of 3.2 million Euro (29: 4.1 million Euro). On an adjusted basis, the segment earnings amount to 28.1 million Euro (29: 22.5 million Euro). The earnings of the Others division totaled -5.7 million Euro (29: 34.8 million Euro). The sharp decline in earnings relates to the prior year's extraordinary net income of 48.3 million Euro from settlements with D&O insurers incurred from liability suits asserted against former Board Members. Excluding this special effect, the prior year's earnings would have amounted to million Euro. On this basis, the earnings improved by 7.8 million Euro mainly as a consequence of costcutting measures in the holding. 2.4 Sales and earnings performance of the Constantin Medien Group The Group generated sales of 47.3 million Euro in 21 (29: million Euro). The line item Capitalized film production costs and other own work capitalized stood at 7.2 million Euro, or 6.7 million Euro below the previous year (76.9 million Euro). This largely reflects the lower production volume of in-house productions in the Film Segment. Other operating income decreased by 41.7 million Euro to 25.2 million Euro (29: 66.9 million Euro). The prior year's figure was substantially impacted by the settlements reached with the D&O insurers for the directors' liability suits. In 21, an opposite effect came from the increase in income from compensation received for copyright infringements in the Film Segment. Cost of materials and licenses fell by 21.6 million Euro to 25.5 million Euro (29: million Euro), which is largely due to a lower production volume in the Film Segment compared to the previous year. Personnel expenses dropped by 5. million Euro to million Euro over the same period last year (137.6 million Euro), which is on one hand due to the deconsolidation of companies sold in 29. On the other hand, the development reflects the staff downsizing announced in the second half of 29, mainly in the holding and the Sports Segment. Other operating expenses receded by 12.1 million Euro from 76. million Euro to 63.9 million Euro. On one side, this decrease reflects the deconsolidation of companies sold in 29 and cost-cutting, especially in the holding. On the other side, the previous year's line item included the UEFA's profit share in Team Holding AG, which was shown as an expense. An opposite effect came from increased expenses related to the enforcement of copyright infringements. 45

50 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RESULTS OF OPERATIONS, FINANCIAL AND NET ASSETS POSITIONS OF THE CONSTANTIN MEDIEN GROUP The Constantin Medien Group's earnings before interest, taxes, depreciation and amortization (EBITDA) declined by 5.4 million Euro to million Euro in 21 (29: million Euro). The prior year's figure included net income from the settlements with the D&O insurers in the amount of 48.3 million Euro. A positive effect came from higher foreign currency exchange gains of 4.8 million Euro (29:.2 million Euro). Financial expenses totaling 1.6 million Euro dropped by 3.6 million Euro mainly as a result of lower interest expenses (3.5 million Euro). Amortization, depreciation and impairments stood at million Euro, down 55.2 million Euro on the prior year's figure of million Euro. The lower figure resulted on one hand from the decline in scheduled amortization and impairments on film assets of 31.1 million Euro to 83.4 million Euro, whereas the impairments on film assets decreased by 7.3 million Euro to only 7. million Euro. On the other hand, scheduled amortization and depreciation as well as impairments on intangible assets and tangible assets fell by 23.1 million Euro to 26.1 million Euro. This decrease is virtually due in full (22.3 million Euro) to fewer impairments. Profit from operations (EBIT) rose by 4.8 million Euro to 6.2 million Euro year-on-year (1.4 million Euro). The financial result amounted to -2.6 million Euro following -3.1 million Euro the year before. The decrease in financial income of 3.1 million Euro to 7.9 million Euro (29: 11. million Euro) largely related to lower income of 9. million Euro from the repurchase of convertible bonds 26/213. The Group recorded earnings before taxes in the amount of 3.4 million Euro for 21, up 3.7 million Euro on the preceding year (-.3 million Euro). Tax expenses were incurred in 21 in the amount of 5.8 million Euro following tax income of 4.3 million Euro in the previous year. The difference of 1.1 million Euro is largely due to the absence of deferred tax income. The prior year's deferred tax income mainly arose from PPA-related amortization and impairment charges. The Group's net profit decreased by 6.5 million Euro to -2.5 million Euro in 21 after 4. million Euro in the prior year. Earnings attributable to shareholders in the amount of million Euro (29: 8.7 million Euro) are slightly below the target range of -12 million Euro to -14 million Euro. The earnings attributable to non-controlling interests amounted to 8.9 million Euro (29: -4.7 million Euro). Earnings attributable to shareholders correspond to earnings per share (basic and diluted) of -.15 Euro (29:.12 Euro per share). 2.5 Net assets position of the Constantin Medien Group CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 21 in EUR Assets 12/31/21 12/31/29 Change Non-current assets Current assets Assets from discontinued operations 281, , ,87 35, ,191-12,27-67 Total assets 62, ,885-24,528 The decline in non-current assets of 12.2 million Euro to million Euro resulted from an primarily amortization-related decrease in other intangible assets of 11.9 million Euro and the drop in non-current receivables of 3.6 million Euro to 7.1 million Euro. This is partly offset by an primarily exchange rate related increase in goodwill of 3. million Euro to 42.7 million Euro. Current assets decreased in total by 12.3 million Euro to million Euro. Trade accounts receivable and other receivables as well as receivables due from associated compa- 46

51 nies and joint ventures dropped by 72.8 million Euro to a total of million Euro, which is mostly due to cash receipts in the gross amount of 57.5 million Euro already recorded in the first quarter 21 arising from the settlements with the D&O insurers. Correspondingly, cash and cash equivalents registered a significant increase of 6.4 million Euro to 28.9 million Euro year-on-year. 2.6 Financial position of the Constantin Medien Group The Group's equity was predominantly influenced in 21 by Highlight Communications AG's acquisition of the 2 percent shareholding in Team Holding AG in the second quarter 21. At the Constantin Medien AG level, this acquisition led to a decrease in equity attributable to shareholders of 17.7 million Euro and to a reduction in non-controlling interests of 21.7 million Euro. In total, equity attributable to shareholders declined by 24. million Euro to 3.8 million Euro. Non-controlling interests decreased by 14.8 million Euro to 4.2 million Euro. The equity ratio amounted to 11.4 percent as of December 31, 21 (December 31, 29: 17. percent). The adjusted equity ratio (after balancing advanced payments received against film assets as well as film-related cash and cash equivalents against corresponding financial liabilities) stood at 14.6 percent (December 31, 29: 21.7 percent). CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 21 in EUR Equity and liabilities 12/31/21 12/31/29 Change Equity attributable to the shareholders Non-controlling interests Total equity Non-current liabilities Current liabilities Liabilities from discontinued operations 3,783 4,23 7,986 85,74 463, ,79 54,992 19, , , ,7-14,789-38,796-27,274 41, Total equity and liabilities 62, ,885-24,528 The decrease in non-current liabilities of 27.3 million Euro to 85.7 million Euro mostly arose from the reduction in non-current financial liabilities of 43. million Euro to 43.3 million Euro. This decline mainly results from the reclassification of convertible bonds (44.3 million Euro) and a loan tranche (15. million Euro) to current financial liabilities as well as from the additional repurchase of convertible bonds 26/213 in the nominal amount of 14.9 million Euro. In contrast, an increase came from the issuance of a corporate bond with a nominal amount of 3 million Euro in the fourth quarter 21 having a coupon rate of 9 percent and a term until October 13, 215. As of December 31, 21, the carrying value of the corporate bond after the repurchase of bonds with a nominal amount of 1. million Euro totaled 28.3 million Euro. In addition, other non-current liabilities increased from.1 million Euro to 1.7 million Euro, which is primarily due to the recognition of a conditional discounted purchase price share of 9.5 million Euro for the acquisition of the 2 percent shareholding in Team Holding AG. Current liabilities went up by 41.6 million Euro to million Euro (December 31, 29: million Euro). This rise is mainly due to the increase in current financial liabilities of 45.1 million Euro to million Euro, which largely relates to the abovementioned reclassification of the convertible bonds and the loan tranche. The advance payments received increased by 1.6 million Euro to 46.1 million Euro. This mostly deals with cash receipts for which revenue has not yet been recognized. By contrast, trade accounts payable and other liabilities dropped by 7.4 million Euro to 127. million Euro. 2.7 Liquidity status of the Constantin Medien Group Cash flow The Constantin Medien Group reports a positive cash flow from 47

52 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RESULTS OF OPERATIONS, FINANCIAL AND NET ASSETS POSITIONS OF THE CONSTANTIN MEDIEN GROUP RESULTS OF OPERATIONS, FINANCIAL AND NET ASSETS POSITIONS OF THE CONSTANTIN MEDIEN AG operating activities of 183. million Euro for 21 (29: 65.8 million Euro). The significant increase was largely due to the decline in trade accounts receivable and other receivables mainly from the settlement payment from two D&O insurers. In 21, cash outflow for investing activities of 86.1 million Euro (29: cash outflow of 64. million Euro) primarily related to productions of the Film Segment, just like in the preceding year. The Group's cash outflow for financing activities of 43.2 million Euro (29: cash outflow of 19. million Euro) mainly resulted from the payment of 3. million Euro for the acquisition of the remaining 2 percent shareholding in Team Holding AG and from the net repayment of financial liabilities totaling 11.3 million Euro. million Euro in Liquidity position and liquidity management The Group companies, Highlight Communications AG and Constantin Film AG, each manage their own liquidity autonomously. Liquidity management for the Sports Segment is controlled by Constantin Medien AG in consultation with the operating companies. Constantin Medien AG acts as a financial coordinator for the companies in the Sports Segment, in order to assure a most cost-effective and continuous coverage of the financial requirements for the operational business and for investments. This is based on a rolling liquidity planning with monthly deviation analysis. In addition, the liquidity status within the Group is regularly examined. In total, the Group reported a positive cash flow of 53.7 million Euro in the reporting period versus a cash outflow of 17.6 The net debt position of the Constantin Medien Group as of December 31, 21 and 29, respectively, is broken down as follows: NET DEBT AS OF DECEMBER 31, 21 in EUR 12/31/21 12/31/29 Change Liquid funds Current financial liabilities Non-current financial liabilities 28, ,6 43,3 148, ,466 86,263 6,421 45,134-42,963 Net debt -93, ,218 58,25 As of December 31, 21, the Constantin Medien Group had at its disposal unused bank credit lines totaling 14. million Euro (December 31, 29: 98.6 million Euro). Assuring liquidity is the primary focus of the conservative approach taken by the Group towards liquidity management. Operating companies are basically required to finance their liquidity demands from the cash flow of their operating activities. In case of major investments and acquisitions, additional financing measures are coordinated with the Group parent company, if applicable. 2.8 Investments of the Constantin Medien Group In 21, additions to intangible and tangible assets in the Group amounted to 86.4 million Euro (29: 85.1 million Euro). Thereof, 78.2 million Euro related to film assets. An amount of 4.5 million Euro was invested in technical equipment and machinery, primarily technical equipment for the Sports Segment, as for example in connection with the expansion of production in HD. 3 Results of operations, financial and net assets positions of Constantin Medien AG The individual financial statements of Constantin Medien AG as of December 31, 21 have been prepared in accordance with the Law on the Modernization of Accounting Regulations (BilMoG). The prior year figures have accordingly not been adjusted as allowed under Article 67 (8) of the Introductory Act 48

53 to the German Commercial Code (EGHGB). Relevant changes for the Company relate to the presentation of treasury stock, the discounting of non-current accruals, the foreign currency translation, the recognition of deferred taxes and additional Notes disclosures. 3.1 Sales and earnings performance of Constantin Medien AG Other operating income came in at 8.2 million Euro, down 6.5 million Euro on the preceding year. The decrease is mainly due to lower book gains from the disposal of financial assets (.3 million Euro versus 6.1 million Euro last year). Major items for the reporting year included cost transfers to affiliated companies (2.8 million Euro), income from the sale of securities held as current assets (1.7 million Euro), income from exchange rate differences (1.2 million Euro), income from cost refunds of third parties (.7 million Euro) and income from the release of write-downs (.7 million Euro). PROFIT AND LOSS ACCOUNT FROM JANUARY 1 TO DECEMBER 31, 21 in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Change Sales Other operating income Personnel expenses Amortization and depreciation Other operating expenses Operating loss Financial result Loss from ordinary activities Extraordinary result Taxes Net loss Loss brought forward from the previous year 8,221-4, ,754-3,33-6,2-9, ,923-12, , ,699-5, ,597-9,7-55,46-64,413 44, , , ,478 1, ,843 5,74 49,386 55,9-44,688-2,315 8,87-2,238 Accumulated loss -165, ,336-12,151 Personnel expenses dropped from 6. million Euro to 4.6 million Euro due to a reduction in the average number of employees by 1 persons during the reporting year. Other operating expenses of the AG totaled 6.8 million Euro, a year-on-year decrease of 1.8 million Euro. The drop is primarily the result of reduced write-downs (-6.2 million Euro), lower legal, consulting and auditing costs (-2.5 million Euro), the absence of non-period expenses (-.9 million Euro) as well as of fallen rental and facility costs (-.8 million Euro) and costs for shareholders' meetings (-.5 million Euro). Other operating expenses consist of various line items such as legal, consulting and auditing costs (1.5 million Euro), rent and facility costs (.6 million Euro), IT costs and maintenance costs (.7 million Euro) as well as write-downs (.5 million Euro). Constantin Medien AG reports an operating result of -3.3 million Euro (29: -9. million Euro). The financial result improved by 49.4 million Euro to -6. million Euro. This increase was mainly due to losses from transfer expenses, which decreased year-on-year by 21.1 million Euro to -6.1 million Euro, and to write-ups to financial assets of 2.9 million Euro (29: 26.6 million Euro write-downs). Earnings from ordinary activities amounted to -9.3 million Euro following million Euro in the previous year. Extraordinary result stood at.1 million Euro after 44.8 million Euro in 29. In the reporting year, the extraordinary result consists exclusively of the profit and loss effects from converting 49

54 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RESULTS OF OPERATIONS, FINANCIAL AND NET ASSETS POSITIONS OF CONSTANTIN MEDIEN AG the accounting to the Law on the Modernization of Accounting Regulations (BilMoG). In the previous year, the extraordinary result contained the net income from both settlements with the D&O insurers in connection with directors' liability suits. Constantin Medien AG closed the financial year 21 with a net loss of 12.2 million Euro following a net loss of 2.2 million Euro one year earlier. 3.2 Net assets and financial positions of Constantin Medien AG BALANCE SHEET (ABBREVIATED VERSION) AS OF DECEMBER 31, 21 in EUR 12/31/21 12/31/29 Change Tangible and intangible assets Financial assets Fixed assets Receivables and other assets Other securities Cash on hand and bank balances Current assets Prepaid expenses and deferred tax assets , ,932 13,542 27,114 48,462 89,118 2, ,57 197,666 67,9 15,815 2,195 85, ,594-4,734-53,548 11,299 46,267 4,18 2,92 Total assets 285,33 282,829 2,24 Equity Accruals Liabilities Deferred income 19,262 14,935 16, ,57 17, , ,245-2,78 11, Total equity and liabilities 285,33 282,829 2,24 The balance sheet total reported in the individual financial statements of Constantin Medien AG slightly increased by.8 percent to 285. million Euro in the reporting year. Fixed assets marginally declined to million Euro (December 31, 29: million Euro). Loans decreased in the reporting period by 7.5 million Euro to 3.5 million Euro as a result of principal repayments and consisted of a loan to PLAZAMEDIA GmbH TV- und Film-Produktion with a term until April 212. This is partly offset by write-ups to financial assets of 2.9 million Euro to the fair value as of December 31, 21. In total, current assets slightly rose by 4. million Euro to 89.1 million Euro in the reporting year (December 31, 29: 85.1 million Euro). However, major shifts occurred between the individual positions within the current assets. Insofar, other receivables dropped by a gross amount of 59.9 million Euro to 1.9 million Euro mainly due to cash receipts from the D&O insurers in the gross amount of 57.5 million Euro received early in 21. The funds received were primarily used to acquire additional units of the convertible bond 26/213 issued by the direct subsidiary EM.TV Finance B.V., Amsterdam/Netherlands and to increase liquid funds. Consequently, securities held as current assets increased by 11.3 million Euro to 27.1 million Euro. Liquid funds rose by 46.3 million Euro to 48.5 million Euro, whereby also the net liquidity inflow of 29.3 million Euro from the issuance of the corporate bond has to be taken into account. On the liabilities side of the balance sheet, the company reported equity of 19.3 million Euro as of December 31, 5

55 EMPLOYEES COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT 21 (December 31, 29: million Euro). The equity ratio remained at a satisfactory level of 38.3 percent as of December 31, 21 (December 31, 29: 4.8 percent). The accruals dropped by 2.7 million Euro to 14.9 million Euro (December 31, 29: 17.6 million Euro). The decrease is mainly due to the lower accruals for legal and consulting costs (-1.7 million Euro) and for outstanding invoices (-.7 million Euro). On the balance sheet date, the company reported liabilities totaling 16.8 million Euro after million Euro in the preceding year. This increase largely relates to the issuance of the corporate bond (3. million Euro) in October 21. An opposite effect came from the reduction of payables due to affiliated companies and other liabilities totaling 18.7 million Euro. 3.3 Financial and liquidity position, liquidity management of Constantin Medien AG In its individual financial statements prepared under HGB as of December 31, 21, Constantin Medien AG reported liquid funds of 48.5 million Euro (December 31, 29: 2.2 million Euro). totaling 5.6 million Euro as of December 31, 21, as in the previous year. Alongside these financial resources, the financial power of Constantin Medien AG is impacted by the profit and loss transfer agreements with its subsidiaries. 3.4 Investments of Constantin Medien AG Investments in fixed assets of Constantin Medien AG in the reporting year amounted to.1 million Euro (29:.2 million Euro), which related to IT services (hardware and software) and office equipment. 4 Employees As of December 31, 21, the Constantin Medien Group had a total of 1,52 employees (December 31, 29: 1,351 employees) including freelance employees. Group-wide the number of salaried employees as of December 31, 21 totaled 1,65 employees (December 31, 29: 968 employees). Including cash on hand and bank balances, Constantin Medien AG's working capital amounted to million Euro as of December 31, 21 following 35.5 million Euro the year before. The reduction of working capital by 72.6 million Euro is the consequence of reporting the company's loan payable to its 1 percent subsidiary EM.TV Finance B.V. as a liability with a residual term of less than one year as of December 31, 21. The issuance proceeds from the 5.25% convertible bond 26/213 were transferred in full from EM.TV Finance B.V. to Constantin Medien AG as a loan to the Company in 26. Based on the premature right of return of the creditors for the convertible bond 26/213 in May 211, the loan of EM.TV Finance B.V. to Constantin Medien AG is now treated as a current item. The loan payable compares to convertible bonds 26/213 held by Constantin Medien AG in the nominal amount of 38.3 million Euro, which cannot be offset against the loan payable. Non-current financial liabilities contain proceeds from the issuance of the corporate bond in the amount of 3. million Euro. Constantin Medien AG had at its disposal unused credit lines The higher headcount as of the closing date is due to new appointments as well as an increase in project-related employment in the Film Segment. The new appointments of salaried employees at the Highlight Communications group was offset by the reduction of salaried employees in the Sports Segment and in the holding in connenction with the personnel measures decided at the end of 29. In contrast, the annual average number of salaried employees decreased, while the average number of project-related employees in 21 almost nearly matched the number in 29. The headcount for Constantin Medien AG stood at 33 employees as of December 31, 21 (December 31, 29: 45 employees). All employees of the Constantin Medien Group attach great importance to customer orientation, dedication and professionalism. These key qualifications are not only crucial for the competitiveness and financial success in connection with external customer relationships, but also in internal co-operation in the centralized functions. 51

56 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT ADDENDUM REPORT DISCLOSURES IN ACCORDANCE WITH 289 PARA. 4 AND 315 PARA. 4 OF THE GERMAN COMMERCIAL CODE (HGB) Strategic human resource planning and personnel development are indispensable to the Group. In the past year, this also meant intensified binding and retaining of high performers and high potentials to the individual subsidiaries and to use the qualifications and competencies of our employees as part of the restructuring of the Sports Segment so that both the individual performance and the staff's development objectives could be considered as best as possible. In addition, the variable compensation components were further expanded in 21 and linked to both the individual performance and the company's targets. 5 Addendum report Exploitation rights for SPORT1 to the Men's and Women's Handball World Championships and the Women's Handball European Championship As part of an agreement with UFA Sports GmbH, SPORT1 acquired extensive rights until 213 to the Men's and Women's IHF Handball World Championships for broadcasting on SPORT1, SPORT1+ and the sports portal SPORT1.de. For the Men's Handball World Championships in 211 and 213, SPORT1 secured the exclusive live rights to all non-german matches as well as extensive non-exclusive after-exploitation rights. For the Women's Handball World Championships in 211 and 213, SPORT1 secured the exclusive live and after-exploitation rights to all matches. In addition, SPORT1 acquired live and exclusive rights from Infront Sports & Media for the Women's EHF Handball European Championships in 212 and 214 for broadcasting on all SPORT1 distribution platforms. Constantin Medien Group is grieving for Benrd Eichinger Entirely unexpected, the producer Bernd Eichinger died of a heart attack on January 24, 211 in Los Angeles. With him, Constantin Film AG has lost a friend and companion, who shaped Constantin Film AG as well as the film industry, both nationally and internationally, for over 3 years, In 1979, Bernd Eichinger, as investor, acquired interests in Constantin Film. Following the IPO in 1999, he became the CEO of Constantin Film AG. He held this position until 21, withdrawing from the company's managerial affairs. As a producer and Deputy Chairman of the Supervisory Board, he nonetheless remained closely associated with Constantin Film AG. With his unique know-how in the film industry, he supported and promoted a new generation of producers, who have since then collaborated closely with the company and have already managed a constant flow of projects in the last years. They will ensure that Constantin Film AG will carry-on in producing successful films, also in the future. Continuation of co-operation between EBU and TEAM On January 14, 211, Highlight Communications AG announced the continuation of the successful marketing co-operation between its subsidiary TEAM and the European Broadcasting Union (EBU) regarding the Eurovision Song Contest until 215 and subject to achieving contractual performance targets, for an additional three-year term thereafter. Since the beginning of their co-operation in 24, the EBU and TEAM established a centralized marketing platform for the Eurovision Song Contest, consisting of sponsorship, televoting, and merchandising elements. Based on these joint efforts, the event has been supported by major international partners. The traditional contest is one of the few truly pan-european TV programs transmitted live via the free-to-air Eurovision satellite network in prime time. 6 Disclosures in accordance with 289 para. 4 and 315 para. 4 of the German Commercial Code (HGB) The subscribed capital of Constantin Medien AG as of December 31, 21 totaled 85,13,78 Euro, divided into 85,13,78 bearer shares with a pro rata value of 1. Euro per share. All shares are common stock that guarantee the right of participation in the Annual General Meeting in accordance with 118 para. 1 of the German Stock Corporation Act (AktG), the right to information in accordance with 131 AktG, the voting right in accordance with 133 ff. AktG, the right to retained earnings in accordance with 58 para. 4 AktG and the basic subscription right in the event of an increase in capital in accordance with 186 para. 1 AktG. 52

57 The Company has no voting rights arising from the 7,424,378 treasury shares held by Constantin Medien AG and its subsidiaries as of December 31, 21. The Company is not aware of any agreements between shareholders regarding the restriction of voting rights. According to its own statements, KF 15 GmbH & Co. KG, Munich, held 15,88,748 shares in Constantin Medien AG as of December 31, 21. This equates to a share of approximately 18.7 percent of authorized share capital and voting rights of 2.4 percent based on outstanding shares (after deduction of treasury shares). Furthermore, KF 15 has an option to increase its proportion of shares by exercising financial instruments by a total of 6,8, voting rights. The exercise period is due to end on March 31, 211. There are no shares which offer exclusive rights of authority to control. The Supervisory Board appoints Management Board Members in accordance with 7 para. 1 of the Articles of Association and 84 para. 1 clause 1 AktG for a maximum term of five years. It determines the number of Management Board Members, whereby the Articles of Association specifies a minimum number of two Management Board Members. The Supervisory Board also has the right to nominate a Chairman of the Management Board. In accordance with 84 para. 3 clause 1 AktG, the Supervisory Board also has the right to rescind the appointment of a Management Board Member and the nomination of the Chairman of the Management Board, should there be an important reason to do so. Such an important reason is defined by 84 para. 3 clause 2 AktG as the existence of a gross breach of duty, in the event of incapacity to carry out management duties or in the event of a vote of no confidence by the Annual General Meeting for reasons that are not clearly unjustified. In accordance with 179 para. 1 clause 1 AktG each amendment to the Articles of Association requires the passing of a resolution by the Annual General Meeting. In accordance with 179 para. 2 clause 1 AktG, resolutions taken by the Annual General Meeting to change the Articles of Association require a majority of at least three quarters of the authorized share capital represented at the passing of the resolution. The Supervisory Board has, in accordance with the Articles of Association, the right to execute changes to the Articles of Association that affect only the wording of the Articles of Association. In accordance with 76 para. 1 AktG, the Management Board bears full responsibility for the management of the Company. The Articles of Association regulate in detail the empowerment of the Management Board, with the approval of the Supervisory Board, to raise the authorized share capital within a period until January 27, 214 by a total of up to 2,,. million Euro through one or multiple issues of new bearer shares against cash or contributions in kind (authorized capital 29/I). The shareholders are generally granted a subscription right. With the approval of the Supervisory Board, the Management Board is additionally empowered, to exclude the subscription right under certain conditions as prescribed under 3 para. 7 of the Articles of Association. Due to the resolution passed by the Annual General Meeting from June 9, 21, the Company was empowered to acquire treasury shares with a no-par-value in the share capital of up to 8,513,78 Euro. The authorization became effective as of the end of the Annual General Meeting on June 9, 21 and is valid until June 9, 215. The authorization may be exercised in part or in full, singly or on several occasions. The acquired shares, in combination with other treasury stock held by the Company or attributable to it under 71a ff. AktG, may at no time exceed 1 percent of authorized share capital. Due to the resolution passed by the Annual General Meeting on July 9, 28, the share capital of the Company was increased by up to 2,,. Euro by issuing conditional bearer shares of up to 2,, (conditional capital 28/I). The conditional capital increase serves to grant shares for bearer or creditor convertible bonds and/or bonds with warrants attached to be issued according to authorization from the Annual General Meeting until July 8, 213 by the Company or by direct or indirect shareholdings of Constantin Medien AG, if issuance is made in cash. The Management Board is empowered to set the further details concerning the conditional capital increase. 53

58 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT MATERIAL TRANSACTIONS WITH RELATED COMPANIES AND RELATED PERSONS DURING THE REPORTING PERIOD RISK REPORT In 26, EM.TV Finance B.V. Amsterdam/Netherlands, a 1 percent subsidiary of Constantin Medien AG, issued the 5.25% convertible bond 26/213, guaranteed by Constantin Medien AG. In accordance with 14 of the bond conditions, every bond holder of his own choice has the right under certain conditions, to demand repayment by the debtor of any or all of his bonds at their nominal value plus interest accrued. This is permitted in the event that a change occurs in the control of Constantin Medien AG. Control is defined as either direct or indirect (under the terms of 22 WpHG, securities trading act), legal or financial ownership of shares bearing more than 5 percent of voting rights in Constantin Medien AG. This right also applies in the event of an offer to purchase shares, whereby the shares already under the control of the bidder and/or persons working in collaboration with the bidder, plus the shares for which the offer has already been accepted, together carry more than 5 percent of the voting rights in Constantin Medien AG. There are no compensation agreements with Members of the Management Board or employees that apply in case of a change of control. 7 Material transactions with related companies and related persons during the reporting period Please refer to Note 11 of the Notes to the Consolidated Financial Statements accompanying in this Annual Report. 8 Risk report 8.1 Risk management Risks are defined as the possibility of unfavorable future developments that are anticipated with a significant, although not necessarily predominant, degree of probability. The Constantin Medien Group's effective and efficient risk management system assures on one hand the Company's long-term going concern and supports Constantin Medien AG on the other hand in achieving the economical targets. The risk management process is based on a risk management policy, which applies to all Group companies. As part of the risk reporting risks are early identified, evaluated and monitored. Reporting is conducted for all Group companies; whereby the risks recognized and the provisions already undertaken are listed and evaluated individually per company and consolidated for the Group per company. As part of the risk reporting, the Management Board will regularly be informed about risks and is responsible for defining appropriate risk control measures. In addition, Group-wide risks are presented semi-annually to the Supervisory Board in the form of a risk report. Significant individual risks are addressed and immediately reported irrespective of the regular cycle Integrated internal accounting-related control and risk management system The internal accounting-related control system of Constantin Medien AG and the Constantin Medien Group covers all measures pertaining to the annual financial statement that ensure complete, correct and timely forwarding of the relevant information that is necessary for preparing the financial statement and the consolidated financial statements, as well as the Group Management Report. This is intended to minimize the risks of incorrect presentation in accounting and external reporting. The internal control system of the Constantin Medien Group is also supplemented through guidelines, directives and working instructions, which are communicated to the respective units in-charge, for purposes of uniform application of these guidelines. As a supportive measure, key processes as well as control structures and responsibilities are documented in a database solution and are continuously updated. Accounting within the Constantin Medien Group is organized on a decentralized basis, with individual departments at the respective levels of the Group's subsidiaries. Constantin Medien AG assists its direct subsidiaries in specific accounting-related topics. The preparation of the individual financial statements of Constantin Medien AG and its subsidiaries is performed in conformity with the respective state-specific regulations. Reconciliation accounts are prepared and reported to the Group accounting department in order to fulfill the requirements for preparing a consolidated financial statement in accordance with the IFRS regulations. The accounting principles in the Constantin Medien Group govern standardized accounting and valuation methods in compliance 54

59 with the IFRS regulations that apply to the parent company. At the Group level, the specific controlling activities for ensuring the compliance and reliability of Group accounting encompass the analysis and, if necessary, correction of the individual financial statements submitted by the consolidated companies. Furthermore, the controlling activities also take into consideration the reports prepared by the auditors and the results of the annual financial statement discussions. In addition, clear delimitations of responsibilities as well as integrated process controls, such as the application of the dual control principle, regulate further control measures. The compliance and effectiveness of the internal control system are assured once a year via process-independent auditing activities conducted by the Group s internal audit department and is regularly reported to the Management and Supervisory Boards. The Constantin Medien Group uses the consolidation system Hyperion for Group accounting. It is the aim to standardize processes and evaluation options of relevance to Group accounting through the use of a common system. In order to leverage additional synergy effects, the different release versions of the consolidation system used in the Group are currently being updated within the scope of a Group-wide Hyperion project. Alongside, the monitoring and controlling system of the Constantin Medien Group is supported by meetings of the Management Board, meetings by the department heads, annual and investment plans, monthly and quarterly reportings and the integration of the legal department. 8.3 Risks within the Sports Segment For SPORT1 GmbH, the availability of attractive sports rights is of great importance regarding the operation of the free-tv channel SPORT1 and the pay-tv channel SPORT1+. As to the acquisition of such rights, SPORT1 finds itself locked in fierce competition with other free and pay-tv stations and, increasingly, also with new content providers such as telecommunications groups and Internet services. In addition, private general-audience programs such as SAT.1 and ProSieben are strengthening their profile in the sector of sports. Therefore it cannot be ruled out that SPORT1 may find itself exposed to even more intense competition in the future. The growing digitization of distribution channels is creating new free-tv offerings as caused by additional transmission possibilities and, if applicable, therefore further competitors on the mid-term as well in acquiring sports rights and on the advertising market. Moreover, there is the risk of lower market share through the increasing number of free-tv channels. SPORT1 is making itself partially independent of third-party rights through the use of its own formats. As SPORT1 has been able to secure substantial rights for the free-tv channel and for its pay-tv offer SPORT1+ that extend well beyond the 21 financial year, such as for the national soccer, handball and basketball leagues, the danger of a short-term increase in license fees has been reduced. However, an increase in the license expenses in a medium-term perspective cannot be ruled out. The development of the advertising markets in Germany and the associated investment willingness by the advertisers have a significant influence on the sales performance of SPORT1, as well as on other free-tv channels. By means of consequent diversification, SPORT1 is striving for a well-balanced sales mix that limits the dependency upon the classical TV advertising market. Nonetheless, the diversification business models in the free-tv area have passed their peak and are developing downward on the whole. The German TV advertising market is marked by fierce competition from sizable price reductions by TV stations. So-called trading deals are accelerating the decline in prices. This aggressive price competition could have lasting effects on the pricing and sharing of advertising spendings. The unaltered politically discussed advertising prohibitions in the automotive and alcohol sectors as well as ongoing state regulation with respect to the State Gambling Treaty or the protection of minors could still additionally impact SPORT1's revenue model. The TV market for value-added services is facing growing competition and is bordering on saturation with the viewers. The advertising customers on the daytime infomercials are subject to increasing margin pressure, which is due to a declining response and falling creditworthiness of the customers as well as rising competition among the online marketers. In the nighttime infomercials market, there are just a handful of market participants active, thus the bargaining power for the remaining market participants rises on the one hand, making the risk spreading difficult on the other hand. 55

60 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RISK REPORT The sweepstake shows legislation adopted by the State Media Authorities in February 29 includes, among other items, stricter regulations for call-in formats. Alongside the protection of minors, emphasis is especially placed on stricter transparency requirements for the sweepstake shows and corresponding formats. It cannot be ruled out that the State Media Authorities or legislators will pass additional restrictions on call-in formats. In addition, there is a risk of fewer revenues in connection with call-in formats because the viewer is less willing to participate in the sweepstake shows. Risks could also arise from the additional regulation of airtime selling. At present, the authorities are increasingly proceeding against the advertising of so-called poker schools (i.e. Internet offerings in which the game of poker can be learned without actually betting real money) and 5 cent sweepstakes (i.e. Internet offerings in which players can participate in sweepstake games with a maximum bet of 5 cents). Thus, administrative proceedings opposing the advertising of the aforementioned offerings have still been asserted against various private media companies and also against SPORT1 GmbH. In addition, the new State Gambling Treaty in effect starting 212 will prohibit the advertising of poker schools and 5 Cent sweepstakes. Furthermore, the advertising of sports gambling that are offered on the basis of a valid license from an EU Member State could result in risks. These largely consist in the fact that the gambling regulators (but also the State Media Authorities) are to be expected to institute administrative interdiction proceedings against advertising in TV and Internet. Currently, the Federal States of Germany are evaluating the State Gambling Treaty in effect until the end of 211. Another risk related to the sale of advertising timeslots results from the State Media Authorities as requested by the Commission for Youth Protection of the State Media Authorities (KJM) being against the advertising of adult offers in the teletext of private broadcasters during the timeslot from 6: to 22:. At the end of 29, agreements were concluded with Germany's key cable network providers Kabel Deutschland (KD) and Unitymedia to secure the analogue and digital distribution of SPORT1 via cable over the medium-term. Due to contractual rights of termination, however, a risk for the analogue cable coverage of SPORT1 could also arise during the duration of these contracts. The contract for analogue and digital distribution with Kabel BW, carrying the risk of being terminated as of December 31, 21 was renewed for one more year. The risk assessment in respect of the general situation on the online market has not changed. Furthermore, it can be assumed that the number of platforms for Internet users will continue to grow. In this context, the growth in online offerings is distributed across completely different fields, such as video, community, user-generated and content platforms. Although both the number of users and the dwelling time on the Internet are continuing to rise albeit increasingly slower but users will ultimately spread across a growing number of individual offerings. As a consequence, the disproportionate coverage growth in individual portals is made more difficult. This danger must be countered by clear unique features in terms of both content and function. On the other side, marketable advertising environments are steadily increasing through the growing number of portals. This has its consequences on the marketing side. Due to growing marketing spaces, it can be assumed that the averaged attainable CPTs (cost-per-thousand contacts) will be subjected to pressure and that individual user contacts can be increasingly less capitalized. Advertising revenues however are representing a main pillar for financing SPORT1. Risks relate to the structuring of Constantin Sport Medien GmbH as the project company for operating LIGA total! and the exclusive nature of distribution via Entertain, the TV platform of Deutsche Telekom AG. However, a certain degree of contractual certainty is provided due to the existing agreement with Deutsche Telekom until the middle of 213. Risks could arise from customary contractual rights of cancellation concerning the feed-in agreement signed between Constantin Sport Medien GmbH and Deutsche Telekom AG until the middle of 213 for the distribution of the programming line-up of LIGA total! and the agreement to produce non-linear contents, occurring during the contractual period. On account of the contractually defined high level of broadcasting continuity for feeding-in LIGA total! into the Entertain TV platform of Deutsche Telekom and the obligation to deliver the non-linear program contents in a timely manner, liability and recourse risks exist in the event of cancellations or delays. 56

61 Due to its customer structure, which primarily comprises television broadcasters and production companies, PLAZAMEDIA is both, directly or indirectly, dependent on the TV advertising market. Although this noticeably recovered in 21, the production market is still exposed to consolidation pressure. The significant risk for PLAZAMEDIA continues to be its dependence on its largest customer, pay-tv provider Sky Deutschland. However, this risk is reduced by long-term agreements with the Sky Deutschland group (external production until the end of 212 and in-house production until the end of 213). There are additional risks in the persistent cost awareness and budgetary discipline of customers. This does not necessarily have a negative impact on the overall order situation. However, continued increased price and margin pressure on the production companies is still assumed. covered by funds from film project promotion and co-production contributions. On account of the large amount of funds required for a production, the partial or complete failure of individual film projects could have substantial negative consequences for the net assets position, results of operations and financial position. In addition, budget overspendings can occur during a production and these costs have to be borne by Constantin Film AG. Due to its experience in film production, Constantin Film AG has generally managed to cover production costs with the exploitation revenues in the past. Furthermore, film productions were kept within a fixed time and financial framework and largely avoided the occurrence of unplanned costs or provided protection against these with appropriate insurance. However, no guarantee can be given that only successful film projects will be realized also in the future. Liability and recourse risks exist in the event of default due to a contractually defined high level of broadcasting continuity for operation of the head end, i.e. a hub for feeding-in programs into the TV platform Entertain of Deutsche Telekom AG. In terms of TV productions, similar formats are produced worldwide. This results in the risk of legal disputes regarding formats in the industry, which also affects the Constantin Film AG. Therefore, appropriate precautionary measures have been taken. As a consequence of PLAZAMEDIA providing extensive technical services as part of the production of the programming line-up of LIGA total! on behalf of Constantin Sport Medien, the operator of LIGA total!, corresponding risks could arise for PLAZAMEDIA due to the customary contractual rights of cancellation concerning the agreements signed between Constantin Sport Medien GmbH and Deutsche Telekom AG occurring during the contractual term. Additional risks continue to exist for PLAZAMEDIA from pending contract renewals and negotiations, respectively, with various important customers (i.e. Disney). In the area of non-fictional service productions, there are risks from the dependence on a single TV station and its future positioning. In addition, the entire TV industry has to deal with a very difficult market situation caused by massive reductions in advertising budgets in the wake of the economic and financial crisis. Although this situation significantly improved in the reporting year, it still however remains to be seen to what extent and to what period the improved economic conditions will again be reflected in higher investments of the TV stations in the programming area. For Constantin Film AG this means the risk that revenues from TV service productions will further decrease is still relatively high. 8.4 Risks within the Film Segment The production of theatrical and television films as well as their distribution is cost-intensive and therefore subject to corresponding financial risks. The production costs of an averagesized German film run between three and seven million Euro; major international productions can amount to a multiple of it. The Constantin Film AG has to finance a part of these costs in advance, as the respective budget cannot be completely Risks when purchasing film licenses When acquiring exploitation rights in promising third-party productions, the Group has to compete with numerous other companies. Although the situation on the purchasing market relaxed somewhat in the reporting year, competition for rights to attractive theatrical films is still on the high. As a consequence, there is the risk of relatively high prices for acquiring such licenses on one hand. And on the other, the residual risk 57

62 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RISK REPORT remains whether the respective film will be accepted by a broad audience and will therefore be economically successful. Both risks are accordingly reduced when purchasing film rights as a result of Constantin Film AG's well-developed and longstanding experience. The existing conditions on the purchasing market could likely be impacted by the entry of new competitors, resulting in the increase in competitive pressure. In this context, it must be mentioned that the major studios are increasingly purchasing German productions and thus positioning themselves as competitors for local products on the purchasing market. Risks in exploitation The Group is exploiting film rights for in-house and third-party titles along the entire value chain. Consequently, it competes at all exploitation levels with a number of providers. Alongside this competitive situation, revenues from theatrical distribution and Home Entertainment could also be impacted by consumer taste and especially in economically difficult times by changes in consumer behavior. The ever-increasing piracy can also lead to significant declines in revenue. The rise in illegal copies could have the effect of reducing the number of moviegoers and decreasing proceeds from Home Entertainment and TV exploitation of films in future. Raising viewer awareness and expanding legal Internet offerings, as well as supporting various interest groups, are measures that the Highlight Communications group has already taken. These measures, combined with a prosecution of offenders, have made an important contribution to the fight against piracy in 21 as well. 8.5 Risks within the Sports- and Event-Marketing Segment In relation to the Sports- and Event-Marketing projects, risks may arise from the TEAM group s dependence on a major client such as UEFA. Previous success and the company's positioning in the market, as well as the targeted strategic orientation towards the European Soccer Associations, help qualify this situation. This is also reflected in the recent extension of TEAM s successful partnership with the UEFA until at least June 215. Subject to achieving contractual performance targets, this contract will automatically renew until at least June 218. Moreover, success in exploitation is linked with a large number of sector-specific risks. Their probability of occurrence and resulting effects on the earnings and financial positions are difficult to estimate. The risks could occur for example as a result of a changed market situation on the part of the utilizer of rights along all value chains. In this way, changes to media laws and the advertising market as well as changes in the structural forms of TV broadcasting (pay-tv, TV-on-Demand) can influence the utilizer's selection of films and the TV broadcasters' programming as well as their purchasing policy. Following the acquisition of UEFA s 2 percent stake in Team Holding AG by Highlight Communications AG, the shares of Team Holding AG are no longer encumbered by a UEFA call option. The shares of Highlight Communications AG in TEAM Holding AG, and TEAM Holding AG s shares in the other TEAM group companies, are subject to a share transfer restriction declaration under the terms of TEAM s agency agreement with UEFA. Under the terms of this agency agreement, UEFA also has a termination right in the event of a change in control of either Highlight Communications AG or Constantin Medien AG. Changes in consumer behavior and consumer taste can also cause market adjustments by the rights utilizers. Finally, the strong trend of concentration towards TV channels could lead to changes in the sales markets. This trend of concentration is strengthened by the tendencies towards digital distribution on the Internet, such as via online shops. With the increasing widespread availability of sufficient bandwidth for downloading and streaming, these forms of distribution are already today becoming more attractive among 2 to 25 year-olds. As a result, a competition especially towards pay-tv can occur in the medium to long-term. The effects of the current economic climate remain unclear. In general, the TV and sponsorship rights for the UEFA Champions League and the UEFA Europa League have been granted to partners of very good financial strength, and credit default rates to date also during the recent economic downturn have been insignificant. However, it cannot be ruled out that individual TV broadcasters or sponsors could run into financial difficulties. The Highlight Communications group's currency risk increased as a consequence of the exchange rate fluctuation and the volatility of the Euro currency against the Swiss Franc. In the 58

63 Sports- and Event-Marketing Segment, the currency translation losses incurred have been more than compensated by higher marketing revenues. However, it cannot be assumed that this also will be the case in future periods. 8.6 Financial risks Liquidity risks A liquidity risk arises if payment obligations of the Group cannot be covered by liquidity on hand or from corresponding credit facilities. Constantin Medien Group had sufficient liquidity reserves taking into account available short-term credit facilities as of the balance sheet date 21. Numerous industries, including the media sector, continue to be confronted with rising credit costs resulting from higher risk premiums or stringent prerequisites of the financial sector in view of criteria to be met by borrowers for the granting of credits. Constantin Medien AG has also been forced to modify its financing policy and to establish it on a broader base. Despite unused credit lines available and the cash inflow from the issuance of a corporate bond, the Constantin Medien Group might be forced to borrow third-party capital via the capital market or credit institutes in the short to medium term, both to refinance existing liabilities and to finance new projects. Therefore, the risk still persists that a worsening of the economic situation of the Group could lead to financing funds not being available or not being available to the extent needed or only being available at distinctly unfavorable conditions. Credit risks A credit risk exists when the debtor is unable to meet a repayment obligation for a receivable on time or at all. The credit risk includes the direct counterparty risk and the risk of credit deterioration. Credit risks could exist on liquid funds, deposit account balances and customer receivables. Possible risks on liquid funds are minimized by allocating bank deposits among several financial institutions. Furthermore, potential default risk on customer receivables are regularly evaluated and, if required, specific provisions for bad debt are recognized. In addition, the Company insures the risk of default caused by insolvency of a debtor also by means of obtaining credit checks. Therefore, the Group assess the credit quality of receivables that are neither overdue nor impaired to be largely satisfactory. The maximum credit risk of the Constantin Medien Group is equivalent to the carrying value of the financial assets. Market risks Market risks are understood to be risks from exchange rate and interest rate fluctuations and other risks from changes in a price base. Currency risks The Constantin Medien Group is exposed to currency risks as part of its ordinary business activities. This primarily relates to the US dollar and due to subsidiaries with the functional currency denominated in the Swiss franc to the Euro. Exchange rate fluctuations can give rise to undesired and unforeseeable profit and cash flow volatility. Every subsidiary is subject to risks associated with exchange rate fluctuation when it transacts with international contractual partners incurring future cash flows thereof that do not correspond to the functional currency of the respective subsidiary. The Constantin Medien Group does not transact business activities in currencies with above-average volatility or otherwise notably risky. Regarding material transactions, mainly in US dollar, the Group aims to reduce the currency risk through the use of appropriate derivative financial instruments. Such derivative financial instruments are entered into with credit institutions. The financial instruments largely relate to future foreign currency cash flows for film projects. In general, the Group monitors that the amount of the hedging instruments does not exceed the amount of the hedged item. As of December 31, 21, forward exchange contracts designated as hedging instruments in fair value hedges amountb to TEUR 1,249 (prior year: TEUR 5,534). The hedging relationships are accounted for as a fair value hedge in conformity with IAS 39. The underlying transactions relate to pending purchases of rights in US Dollar. Interest risk Interest risk generally arises when market interest rates change, 59

64 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT RISK REPORT which can improve or worsen the proceeds from deposits or payments for money procured. The interest fluctuation risk for the Group relates predominantly to current and non-current financial liabilities. Furthermore, an interest fluctuation risk arises from the mismatching of maturities, which is actively monitored by the Group, especially through observations of the development of yield curve. At the present time the Constantin Medien Group has available fixed and variable interest-bearing current financial liabilities and fixed interest-bearing non-current financial liabilities. In times of rising interest rates, fixed interest agreements offer a corresponding safeguarding against additional costs. However, in times of falling interest rates they have the disadvantage that the Company cannot profit from that development. In case of financial liabilities without flexible arrangements for withdrawal and repayment, fixed interest conditions provide adequate planning assurance. In contrast, in credit agreements with high flexibility, variable interest rate agreements allow for future fluctuations in credit withdrawing. Furthermore, there is the possibility to establish a fixed interest base through interest hedges. 8.7 Tax risks As part of the restructuring of the 4% convertible bond 2/25, which was executed in 24, the former EM.TV AG was obligated to divest its indirect holding in the Tele München Gruppe (TMG). EM.TV Beteiligungs GmbH & Co. KG, a subsidiary of EM.TV AG, sold this shareholding at the end of 24. This action did not result in an immediate tax burden for the former EM.TV AG. Still, it cannot be ruled out that the loss from the sale will not be considered as deductible against taxes and thus can no longer be offset against future profits. In connection with the restructuring, a number of companies in which Constantin Medien AG or its corporate predecessors, had held a stake of more than 5 percent, were transferred within the Group. Should substantially new assets be allocated to these companies within the next five years, the tax loss carryforward at the time of the transfer of the ownership would cease to exist. In the second quarter of 29 a tax audit for the years from 21 to 26 began for Constantin Medien AG and its subsidiaries, which is still in progress. It cannot be ruled out that additional findings will be reached beyond those findings previously made, resulting in tax assessments that will differ from the previously made assessments. 8.8 Risks from legal proceedings Damage claims and shareholder lawsuits Almost 9 shareholders have filed lawsuits against the former EM.TV & Merchandising AG and EM.TV AG, respectively, now Constantin Medien AG. At the present time, 4 proceedings are pending with about 12 shareholders. The total sum of the damage claims from proceedings still pending amounted to around 3.4 million Euro as of December 31, 21. The claims are based on a number of different circumstances and legal foundations; the background being the drop in the EM.TV stock price that occurred during 2/21. So far, more than 3 rulings have been reached. Furthermore, numerous plaintiffs withdrew their lawsuits and their legal actions, respectively, prior to the courts reaching a decision. Over 37 lawsuits have now been finalized and are legally valid or have been settled by withdrawal. In almost all cases, the courts delivered judgments in favor of the Company. So far, the Company has been ordered to pay damages in only three cases. It cannot be ruled out that further plaintiffs will be adjudged damages in the event that their claims fall within the statute of limitations, the preconditions exist for liability and the plaintiffs succeed individually in proving causality. In case of claiming, the Company will review and, if applicable, reassert any rights for recourse against former Board Members. Several plaintiffs have filed petitions for rulings on certain facts and judicial subjects based on the German Capital Investor Proceedings Act (KapMuG). Some of these petitions have already been published in the lawsuit register. With respect to two complex issues, again draft decisions have been passed by the Munich Higher Regional Court, which has not announced a representative ruling. One draft decision was 6

65 OPPORTUNITIES REPORT COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT remanded to the Munich District Court I by resolution dated December 16, 21. In the event that the Court conducts exemplary legal proceedings and passes representative rulings, these would then have a binding effect on all cases whose rulings depend on the respective factual and legal issue. The share-based proceedings filed by various applicants in 24 challenging the inadequacy exchange ratio related to the restructuring of EM.TV & Merchandising AG, will probably be continued in 211 by the Regional Court Munich I. 9 Opportunities report 9.1 Opportunities within the Sports Segment Through its high technical coverage in about 93 percent of the accessible German households, the free-tv channel SPORT1, as a special interest channel, considers itself to be wellpositioned to face the stiff competition for attractive sports rights. With first exploitation rights in free-tv for the 2 nd Soccer Bundesliga (until 213), SPORT1 has attractive top rights to ensure the presence of top level soccer on the station over the next few years and to secure the appeal of SPORT1 for advertisers. With other sports rights as well, such as handball, basketball, motorcycling, ice hockey, tennis, athletics or cycling, the broadcaster has secured an attractive rights portfolio that extends in part well beyond the 211 financial year. The Federal German States are currently examining the State Gambling Treaty that became effective early in 28 and is limited until the end of 211 which was declared contrary to European law by the decision of the European Court of Justice on September 8, 21; the treaty sets forth a state monopoly for operating sports betting and online casino games as well as TV and Internet advertising bans for sports betting and online casino games. Thereby, the review includes the further perpetuation of the state monopoly for the entire gambling system of the federal states beyond December 31, 211, but also the implementation of the dual system for the areas of sports betting and/or online casino gambling, in which both state and private providers would receive concessions and could advertise on TV and Internet. With respect to the latter, against the background of the mentioned rulings of the European Court of Justice, declared on September 8, 21. In several preliminary ruling procedures on presentation of German courts regarding the state monopoly of the currently effective State Gambling Treaty to be illegal, because the actual arrangement of the monopoly also violates European law. Therefore, in the event that private sports betting and/or online casino gambling offers would be admissible early in 212, thus leading to a liberalization of the advertising regulations, substantial revenues could be generated from the advertising of such offers without promoting the risks currently existing for the corresponding offers. The Federal German States are expected to come to a decision in the first half of 211. Increasing digitalization of distribution platforms is leading to new channels and less expensive distribution possibilities both nationally and internationally. Accordingly, the opportunity arises for realizing cost-savings in connection with programming transmission. Therefore, ARD, ZDF, ProSiebenSat.1 Media AG and the media group RTL Germany have announced to stop the cost-intensive analogue-satellite transmission of their programming signals probably as of April 3, 212. SPORT1 will cease its analogue-satellite distribution between early January 212 and the end of April 212 and will realize the savings arising from stopping this distribution as of that date. In the third and fourth quarters of 21, agreements were signed with the subsidiaries of SES Astra, Deutsche Telekom, Unitymedia and Kabel BW as well as Tele Columbus for the distribution of SPORT1 in HD quality and also for the distribution of the new pay-tv channel SPORT1+ with Deutsche Telekom, Kabel Deutschland, Unitymedia and Kabel BW. Beyond these agreements, SPORT1 is also conducting promising talks with other infrastructure providers for distributing SPORT1 HD and/or feeding-in SPORT1+. In the case that agreements are signed with these infrastructure providers, SPORT1 would have the opportunity of generating additional revenues. Moreover, the effectiveness of the exploitation is further improved from the exploitation of sports rights in pay- TV also on SPORT1+ and the synergies arising in connection with the production of SPORT1 can be better used. Even in a sports year without any Olympic Games or European Championships or World Cups in Soccer for men which is also 61

66 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT OPPORTUNITIES REPORT associated with lower budgets for event-related online campaigns, SPORT1.de's differentiated business and revenue model offer competitive advantages. In particular, the qualityoriented editorial environment is quite ideal to implement brand and image-oriented advertising, on which the companies will also be dependent in the future despite an increased orientation towards performance. SPORT1.de will also benefit from its strong market position in the sports online sector as well as its integration in the Constantin Medien AG Group as well as the resulting synergy potential arising, among others, from marketing and promotion. Enhanced economic opportunities occur for SPORT1.de due to the user's high affinity from a liberalization of the sports betting and gaming market as well as its advertising restrictions placed by legislature. Such a liberalization would similar to the TV sector lead to a loss of risks for the advertising of sports betting and other gambling offers. In addition, there are growth opportunities both in coverage and marketing in the chosen path towards diversification and increasing distribution of SPORT1.de contents, especially in the areas of video and mobile. The online market also offers new possibilities of optimization and therefore sales generation on the basis of its content and technically dynamic further development. Because of its positioning and structure, SPORT1.de can respond very quickly to such changes. Subsequent to the highly innovative set-up, the successful implementation and market launch in 29, the Constantin Medien Group could again expand its competiveness and competitive position through the constant high-quality of editorial and technical broadcasting of LIGA total! in particular in the areas of IPTV and HD. Considering that the topic of 3D was a major driver for LIGA total! in 21 and, in respect of its growing importance, there is also other strategic and operative development potential reaching beyond the project LIGA total!. In a production market still marked by persistent price and margin pressure, PLAZAMEDIA can benefit from the ongoing competitive adjustments due to its wide range of integrated services, processes and technical equipment as well as its strong market position that is based on years of work, experience and proven expertise. PLAZAMEDIA is well-prepared, especially for change and development towards new technologies and, in general, towards other distribution platforms: The demand of rights holders such as associations and leagues or infrastructure providers and platform operators for seminal productions in the High Definition standard or in 3D received a massive boost, particularly in the sports production area within 21. With regard to this development, PLAZAMEDIA strategically positioned itself at an early stage with its extensive technological expertise and experience. In addition, PLAZAMEDIA is still pursuing project-related ventures with specialized partners, such as TV SKYLINE in the field of state-of-the-art mobile camera systems, with whom a multi-year exclusive co-operation has been agreed on. 9.2 Opportunities in the Film Segment In the field of TV service production, Constantin Film AG is consequently realizing its strategy to further expand the foreign business amongst others, by developing new markets and to drive forward distribution to other content providers. On the one hand, these measures will reduce the current dependency on domestic business and on the other hand, at least partially offset a decline in sales in this sector, which cannot be ruled out. Due to Constantin Film AG's major international projects that are currently being produced and exploited especially in the 3D area the possibility exists that the Group might be able to benefit from significant shares of revenue if these films, as for example in the reporting year Resident Evil: Afterlife, are very successful in non-german speaking countries. 9.3 Opportunities in the Sports- and Event-Marketing Segment Following a strong start to the marketing process for TV broadcasting and sponsorship rights for the UEFA Champions League and UEFA Europa League (seasons 212/213 until 214/215), good prospects may arise for a positive overall result. If a contractual performance target for that marketing process is achieved, then TEAM s mandate with UEFA will be automatically extended until at least June 218. Any business activities in the sports sector with clients other than UEFA will be subject to a careful selection process. In this context it will be a priority to ensure that TEAM s core projects for UEFA are not adversely affected. 62

67 OUTLOOK COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT On the basis of past success and strong customer relationships, the prospects are also good for TEAM s music projects. The recent extension of TEAM s mandate with the Vienna Philharmonic Orchestra provides a good platform for developing this sector. The same applies to the extension of TEAM s mandate with the European Broadcasting Union (EBU) for the Eurovision Song Contest. Economic Prognosis 21/211, December 14, 21; Federal Statistical Office, Press release, January 12, Sector-specific conditions Sports Segment Compared to 21, 211 will not be characterized as a sports year with major events like the Olympic Games or a Soccer World Cup for men. Insofar, this year will realize fewer investmentsintensive advertising campaigns with explicit sports orientation. 1 Outlook 1.1 Economic environment At the beginning of the calendar year 211, economic experts agreed that the economic recovery in the global economy would proceed in general, albeit at a weaker level. A tense situation would prevail in the international financial markets, according to an analysis of the Ifo Institute for Economic Research Munich. Concerns about the sharp increases in budget deficits and the debt levels of industrialized countries as well as the accompanying doubts regarding the solvency of some certain countries on the periphery of the Euro zone are dampening the optimism for 211. The International Monetary Fund (IMF) sees the reasons for the slowdown in the growth dynamics to come from the unequal balance of growth between the more modestly-growing industrialized countries and the rapid development in many emerging countries. The Monetary Fund predicts global economic growth of 4.2 percent for 211. The pace for economic performance is also expected to be slower for Germany. The Ifo Institute considers the private consumer spendings, for which growth of 1.4 percent is projected, to be the main pillars for growth. As early as 21, domestic demand was by far the strongest growth driver. In 211, fiscal policy will have a considerably more restrictive effect on economic performance due to saving efforts for the public authorities and since the impact of the economic stimulus programs will cease. The IMF predicts growth in the gross domestic product of 2. percent for Germany in 211 compared to a gain of 3.6 percent for 21 projected by the Federal Statistical Office. Sources: International Monetary Fund (IMF); World Economic Outlook, October 21; Ifo Institut für Wirtschaftsforschung e.v., Munich, Due to the solid economic development in 21, continued positive advertising dynamic is expected for 211. The ZAW is projecting a rise in total advertising investments of 2.7 percent, which would translate into exceeding the 3 billion Euro hurdle in gross advertising revenues. The net advertising revenues for media will most likely amount to about 19.2 billion Euro equaling a rise of 2.5 percent versus the prior year. This is under the premise that economic rejections or market disruptions will not take place in 211. Source: Zentralverband der deutschen Werbewirtschaft ZAW The VPRT is assuming positive impulses for the pay-tv market in Germany largely due to the further progress of digitization and the related upgrading of more households with pay-tv and HD and more devices capable of 3D. Analysts of Hypovereinsbank even see opportunities for the German pay-tv market in doubling the sales volume. After many challenging years, industry experts are also forecasting that the upturn will continue. Additional growth potential will arrive from new forms of distribution such as videoon-demand (VoD) in High Definition qualitiy and pay-offers for tablet-computers as the ipad. In contrast, negative influence factors for the pay-tv market could include the slow pace of digitization and the excessive number of program offerings by ARD and ZDF. This is also largely impacted by the combined purchasing power of the fee-financed public broadcasters in the competition for rights such as for example sports and film licenses. Moreover, both the free- and pay-tv providers fear an increasing loss in control of their programming content without a further improvement of copyright and ancillary copyright concerning the unauthorized use. Sources: Press release VPRT, July 22, 21, article in IT-Times dated January 18, 211; Press release BLM dated January 28,

68 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT OUTLOOK According to estimations by the Bundesverband der digitalen Wirtschaft, BVDW (Federal Association of Digital Economy), growth in gross advertising investments in the online sector will once again be double-digit in 211. The shifting of large advertising budgets towards digital channels will also continue into 211. In this way, major brand manufacturers like adidas and Nike have announced that the online sector will be their most important marketing channel starting in 211. Studies such as the Goldmedia Trendmonitor 211 are predicting that the gross advertising investments in the online sector will already surpass the investments in popular magazines in 211. Sources: BVDB-Interview from January 2, 21/HORIZONT, Goldmedia Trendmonitor 211/ Analyses and Prognosis for 211 in the areas of media, entertainment and telecommunications According to a PwC study, the basis for using IPTV broadband connections in German households, will increase from 25 million households in 29 to 27.8 million in 214. PwC anticipates dynamic growth in the IPTV-subscribers from 1.5 million in 21 to 2.9 million in 214. Such growth will be achieved from aggressive marketing and purchasing of attractive contents like the Soccer Bundesliga. This development has been driven by backward channel capacity and the choice of various interactive services, as well as the growing offer in HD programming based on an increased demand. However, it is expected that IP-based television will change dramatically in the future. A convergence of Internet, TV, Web-TV and IPTV will take place. Source: Study German Entertainment and Media Outlook: , PricewaterhouseCoopers AG Wirtschaftsprüfungsgesellschaft The demand in the production market will still be characterized by strong cost awareness despite a significant recovery of the TV market. Therefore, creating added value for the customers, such as through exclusive technological innovations has become more important. Given this market environment, PLAZA- MEDIA is well-placed with its consequent positioning as an innovative and flexible production service provider. Positive signals are expected more and more from promising technologies as HD or 3D productions. But also in the ongoing consolidation and the resulting adjustments of the production market, impulses for companies are still seen in this industry Film Segment In the area of theatrical distribution, the German cinema market is expected to expand in terms of sales and the number of moviegoers in 211 compared to the year before. Highquality 3D productions from the world's biggest filmmakers such as Steven Spielberg, Martin Scorsese, Peter Jackson and Michael Bay as well as an upturn to the past poor performance of German films could lead to significantly rising revenues. Several Constantin Film 3D productions like Wickie Auf großer Fahrt or The Three Musketeers will make a contribution, as well as films from other producers like Kokowääh, Dschungelkind and Hexe Lilli. In addition, also Paramount, as the last major studio, plans to step in the distribution of German films and the stronger independent sector could also contribute with promising films such as The King's Speech, True Grit, Black Swan or The Fighter. In the TV service production business, it remains to be seen to what extent the increasing advertising revenues of TV channels will stimulates the creative industry. In the summer months, a survey of the producer's alliance still portrayed a desolate athmospheric picture. Only a few producers expect a rising volume in service productions and higher budgets for TV service productions during this period. Because of the long development periods for TV projects, the effect of improved economic conditions for the producers will be delayed. However, the positive mood in the industry causes hope for more investments being made by the broadcasters in the fictional area in the near future. How the producer's role will develop over the next few years remains to be seen. Source: Financial Times Deutschland dated July 9, 21, article entitled: Filmproduzenten gefriert das Lächeln Sports- and Event-Marketing Segment Last year, the global sports market recovered quite well from the economic and financial crisis and will continue to successively grow in the coming years. The auditing company, PricewaterhouseCoopers (PwC), is projecting an increase in total income by an average of 3.8 percent per year for the period from 21 to 213. PwC is expecting the strongest growth drivers (annual average of 4.6 percent) in the sponsorship segment, which based on income from ticket sales is even today the second-largest 64

69 source of income for the sports sector. However, the gap has widened in sports sponsorship as a result of the economic and financial crisis. While top-events with global coverage continue to attract sponsors with high interest, the small and mediumsized events are having greater problems in finding sponsors. This is partly due to the fact, that sponsors are increasingly demanding more clarity and measurable information about the value they get in return for their investment. Such data can be much better captured at major international events. the central topics of video and mobile. In the mobile sector, SPORT1.de will be presented, in addition to the already very successful iphone-app, on all important mobile devices with own news-applications. This will include examining the expansion of online offers for new, additional portals that will thematically flank and complement SPORT1.de. The first step in this direction has already been taken with the launching of the online gaming platform SPORT1GAMES.de or the SPORT1 YouTube-Channel. PwC is predicting average annual growth rates of 3.7 percent in the area of broadcasting rights for sports events. Based on the extensive coverage of the 21 FIFA World Cup as well as the 212 Summer Olympics, development in this sector will be marked by high volatility, however. PwC considers the biggest challenge in the future for both the providers and the acquirers of broadcasting rights in the protection of these rights. The explosion of digital media combined with the increasing content piracy means that today, live sports broadcasting is already available free of charge on the Internet. Source: PricewaterhouseCoopers publication Back on Track? published in May Strategic priorities Group The Constantin Medien Group is continuing to pursue its strategic objective of becoming a leading media group in Germanspeaking countries, which generates stable, positive financial results Sports Segment Given the increasing digitization of distribution platforms and the related new channels and distribution possibilities SPORT1 places top priority on intensifying the multimedia strategy. Therefore, beyond existing agreements, intensive talks with other infrastructure providers are being held for the distribution of SPORT1 HD and SPORT1+, respectively, and a number of other platforms to distribute its sports contents. The consequent expansion of existing and development or further development of new diversification models are also top priorities for SPORT1. The activities in the online sector as well will aim for additional distribution of the brand SPORT1. This will largely focus on Following the successful set-up and introduction phase of the new Bundesliga live channel LIGA total! in 29, the top priorities in 211 will be on upholding the high-editorial and production technological competencies and, in respect of the anticipated interactive functionalities of the TV and mobile platforms of Deutsche Telekom, the further development of innovative production technologies such as 3D will be the focus. The strategic priorities of PLAZAMEDIA will continue to be the emphasis on the core business as well as the intensification and expansion of the relationships with existing customers in Germany and abroad. In particular, the expansion of technological market leadership in HD and, above all, the further development of promising technological innovations like 3D will play an increasingly important role against the background of higher demand. Constantin Sport Marketing's strategic top priorities will be on sustaining its position as centralized marketer of the Sports Segment of Constantin Medien AG with advertisers and agencies. Whereas the focus of the core business media marketing is on securing and expanding the market position, new revenue sources should be generated by opening up further business fields, such as event and personality marketing. Additionally, broadening the marketing portfolio by new clients under both economic and strategic aspects will be examined and pushed ahead Film Segment Constantin Film AG's strategic priority in the coming months will be on the continuous optimization of the persistent highquality of its national and international in-house productions. Top priority is mainly on producing film titles that trigger the emotional needs of the audience. But conceptually, compelling 65

70 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT OUTLOOK productions with manageable budgets and a correspondingly manageable audience risk are also of interest to Constantin Film AG. Accordingly, the following in-house and co-productions, among others, are underway in 211: filming of the popular play Der Gott des Gemetzels (director: Roman Polanski) with a star-studded cast (Kate Winslet, Jodie Foster and Christoph Waltz), the comedy Türkisch für Anfänger Der Film (director: Bora Dagtekin), the 3D CGI film Tarzan and a project featuring the star comedian Kaya Yanar. The strategic aim of Constantin Film AG and its subsidiaries in the TV service production business field is to still offer highquality and innovative products at affordable prices to TV broadcasters against a highly competitive environment. A precise monitoring of developments and trends in the global TV market, the acquisition of promising subject matter and economically profitable productions all form the basis for solid results in this business field. Priority is also on the further expansion of activities outside of Germany through the subsidiaries of Constantin Entertainment GmbH. In this way, the Constantin Film majority holding MOOVIE the art of entertainment GmbH produced, among others, the TV movie Das Versteck for ZDF. Constantin Television GmbH is working on A Dangerous Fortune, a film adaptation of the successful novel from bestselling author Ken Follett. Olga Film GmbH is planning, among others, a new episode to the popular ZDF crime series Kommissarin Lucas in 211. The Constantin majority shareholding Rat Pack Filmproduktion GmbH will be working on a new TV movie, a six-part comedy series, and a ten-part TV show in the current business year. Constantin Entertainment GmbH is currently working on realizing the following projects: eight episodes of the sketch comedy Die Dreisten Drei, six episodes of the documentary-soap Stellungswechsel, the event-report Wie verrückt ist Deutschland?, a weekly science quiz show for the Austrian channel ServusTV as well as the production of additional off-air events. In 211, Constantin Film AG is also planning the proven combination of national and international in-house and co-productions as well as high-quality third-party titles in the area of theatrical distribution; from today's perspective about ten films are scheduled for release. As in prior years, Constantin Film AG will release its top titles to cinemas in early autumn this year featuring The Three Musketeers and Wickie - Auf großer Fahrt. The 211 distribution line-up started in early January with the in-house production "Die Superbullen" with Tom Gerhardt, attracting 43, moviegoers to date. The third and final sequel of Vorstadtkrokodile was released in mid-january and has so far attracted an audience of 71, viewers. At the present status, Constantin Film's distribution slate for this year will conclude with the co-production Der Gott des Gemetzels (release date: end of November 211) and the film adaptation of Cornelia Funke's bestselling book When Santa Fell to Earth, scheduled to hit the theaters in December 211. Source: Blickpunkt: Film, March 8, 211 (Rentrak EDI) The strategic priority in the Home Entertainment area is still on first releases of Constantin Film's high-quality distribution lineup with promising licensed titles as well as releasing this production palette at strategically beneficial times on the video sell-through and video rental markets. A clear marketing strategy, adequate pricing policies and an accumulation of DVDs and Blu-rays (e.g. with bonus material) are also of great relevance. The first quarter has already promised a successful start into 211 with Constantin Film's cinema hits Step Up 3D, Resident Evil: Afterlife and Animals United as new releases on the market. In addition, the Constantin Film group has been intensively dealing for years with video-on-demand and related new forms download-to-own and electronic sell-through. In this context, co-operations with appropriate partners were explored at an early stage to mutually develop new strategies that would offer economically feasible conditions. In the areas of license trading and TV exploitation, the Group aims to further expand its strong contacts with the major TV channels and to offer top-rate productions at affordable prices. The free-tv exploitation at the beginning of 211 will mainly be marked by revenues generated from the films Freche Mädchen, Bangkok Dangerous, Cassandras Traum and Urmel voll in Fahrt. Arising from the licensing of pay-tv rights, revenues are primarily expected in the first quarter 211 from the licensed titles Red Cliff and The Box. 66

71 1.3.4 Sports- and Event-Marketing Segment The marketing process for TV broadcasting and sponsorship rights for the UEFA Champions League and UEFA Europa League (seasons 212/213 until 214/215) will continue throughout 211 and will last until summer 212. Sales in TV markets and sponsor product categories will be staggered and tactically timed to achieve the optimum sales results. free-tv area, the Group is consequently emphasizing the development, setting up and expansion of new business fields in the areas of distribution and online activities as well as broadening the existing customer base and in new technologies in the production sector. However, uncertainties surround the setting up and expansion of these new business fields, which could impact earnings. On the operational side, a busy 211 has begun with the Vienna Philharmonic Orchestra s New Year s Concert. The knock-out phases of the UEFA Europa League and the UEFA Champions League will be followed by the finals, which will be staged in Dublin (May 18, 211) and at Wembley Stadium, London (May 28, 211), respectively. In relation to TEAM s music projects, the final of the Eurovision Song Contest will be staged in Düsseldorf on May 14, 211 and the Vienna Philharmonic Orchestra s open air Summer Night Concert is scheduled for June 2, 211. The UEFA Super Cup will once again be staged in Monaco in August 211, followed by the group stages of the 211/212 season of the UEFA Champions League and the UEFA Europa League in the period September through December. Following the extension of TEAM mandate for the marketing of the commercial rights for the UEFA Champions League, UEFA Europa League and UEFA Super Cup, there are talks between UEFA and TEAM concerning potential co-operation in relation to future match organisation aspects of those competitions regarding the seasons after 211/212. Those discussions will continue in the current year to see if agreement can be reached on a new form of co-operation for the provision of match organisation services beyond the season 211/ Financial targets of the Group It is noted that actual results could significantly differ from expectations given about predicted developments if assumptions, as the background for the forward-looking statements, prove to be inapplicable. In the Sports Segment, the Management Board is predicting sales at the level of 21, and slightly positive earnings, for the financial years 211 and 212. Because of the downward development of previous diversification business models in the In the Film Segment, competition is still expected in the theatrical and TV production sectors on the German market for the financial years 211 and 212. In the areas of license trading, distribution, home entertainment and production, increased competition could also arise with national distributors, which are partly integrated in international groups. Continued stabilization of advertising revenues could positively affect the service production activities of the TV stations. Nonetheless, due to the present market situation that is marked by uncertainty especially with regard to the performance of our major film releases for 211 and the development of the German service production market determining a reliable prognosis is difficult. With regard to this development, the Management Board is predicting sales for the financial year 211 to be slightly above the 21 level. For 211, a result nearly at the level as in 21 is expected. It is noted that the earnings will be affected by lower PPA-related amortization. These earnings could improve if the films released in the second half of the year (particularly, The Three Musketeers and Wickie - Auf großer Fahrt ) draw high audiences. Likewise, the solid worldwide performance of Resident Evil: Afterlife could lead to our global distributors providing surplus guarantees of considerable levels. This can also not be quantified at the present time. Assuming that the German television market will have been stabilized in 212, it can be considered that the Film Segment will reach the earnings level of the past. In the Sports- and Event-Marketing Segment, constant sales and earnings are projected for 211 on the basis of the longterm contracts in place. For 212, the Group is projecting a continued steady business performance, among others, based on the current distribution process for the TV and sponsoring rights of the UEFA Champions League and the UEFA Europa League for the seasons 212/213 through 214/

72 COMBINED GROUP MANAGEMENT AND MANAGEMENT REPORT OUTLOOK On this basis and considering the holding costs and financing costs, the Management Board is currently predicting Group sales in a range of between 47 million Euro and 49 million Euro, with Group earnings attributable to shareholders within a corridor of -6 million Euro to -7 million Euro for 211. For the 212 financial year, the Management Board is projecting a stable sales performance with a simultaneous improvement in the Group earnings attributable to shareholders. From today's perspective, the Management Board anticipates negative earnings for the individual financial statements of Constantin Medien AG within a single-digit million euro range for the financial years 211 and 212. Ismaning, March 21, 211 Constantin Medien AG Bernhard Burgener Chairman of the Management Board Antonio Arrigoni Chief Financial Officer 68

73 69

74 7

75 CONSOLIDATED FINANCIAL STATEMENTS 71

76 CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEET ASSETS CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 21 in EUR Note 12/31/21 12/31/29 Non-current assets Film assets , ,834 Other intangible assets ,663 71,59 Goodwill ,78 39,737 Tangible assets ,987 17,415 Investments in associated companies and joint ventures 5.4 5,914 5,68 Non-current receivables 5.6 7,141 1,731 Other financial assets Deferred tax assets ,148 2, , ,87 Current assets Inventories 5.5 2,941 3,93 Trade accounts receivable and other receivables 5.7/ , ,282 Receivables due from associated companies and joint ventures 11 9,253 Other financial assets 5.6 2, Income tax receivables 2,255 3,35 Cash and cash equivalents , , ,653 35,923 Assets from discontinued operations TOTAL ASSETS 62, ,885 72

77 EQUITY/LIABILITIES CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 21 in EUR Note 12/31/21 12/31/29 Equity 5.12 Subscribed capital 85,131 85,131 Treasury stock -7,424-7,424 Capital reserve 111, ,989 Other reserves 14,147 9,45 Accumulated loss -16, Shareholders' interests -11,378 8,79 Equity attributable to the shareholders 3,783 54,79 Non-controlling interests 4,23 54,992 7,986 19,782 Non-current liabilities Financial liabilities ,3 86,263 Other liabilities , Pension liabilities ,636 3,778 Provisions , Deferred tax liabilities ,774 22,54 85,74 112,978 Current liabilities Financial liabilities ,6 214,466 Advance payments received ,14 35,487 Trade accounts payable and other liabilities ,11 134,42 Liabilities due to associated companies and joint ventures 2,392 2,576 Provisions ,227 28, Income tax liabilities ,332 7, , ,78 Liabilities from discontinued operations TOTAL EQUITY AND LIABILITIES 62, ,885 73

78 CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED PROFIT AND LOSS ACCOUNT CONSOLIDATED PROFIT AND LOSS ACCOUNT JANUARY 1 TO DECEMBER 31, 21 in EUR Note 1/1 to 12/31/21 1/1 to 12/31/29 Sales , ,66 Capitalized film production costs and other own work capitalized 6.2 7,24 76,9 Total output 54, ,966 Other operating income ,151 66,96 Costs for licenses, commissions and materials -61,553-75,96 Costs for purchased services -188, ,18 Cost of materials and licenses , ,68 Salaries -117,19-121,366 Social security and pension costs -15,393-16,273 Personnel expenses -132, ,639 Amortization and impairment on film assets -83, ,441 Amortization/depreciation and impairment on intangible and tangible assets -26,65-49,193 Impairment on goodwill -3,158-4,144 Amortization, depreciation and impairment , ,778 Other operating expenses ,858-75,962 Profit from continuing operations 6,18 1,425 Profit/loss from investments in associated companies and joint ventures ,398 Financial income 6.8 7,944 11,7 Financial expenses 6.9-1,558-14,122 Financial result from continuing operations -2,614-3,115 Profit/loss from continuing operations before taxes 3, Income taxes -6,89-9,935 Deferred taxes ,256 Taxes 6.1-5,831 4,321 Profit/loss from continuing operations after taxes -2,442 4,29 Net loss from discontinued operations Net profit/loss -2,463 4,12 thereof non-controlling interests 8,915-4,697 thereof shareholders' interests -11,378 8,79 74

79 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME/LOSS CONSOLIDATED FINANCIAL STATEMENTS JANUARY 1 TO DECEMBER 31, 21 Earnings per share Earnings per share attributable to shareholders, basic (in EUR) Earnings per share attributable to shareholders, diluted (in EUR) Note /1 to 12/31/ /1 to 12/31/ Earnings per share from continuing operations Earnings per share attributable to shareholders, basic (in EUR) Earnings per share attributable to shareholders, diluted (in EUR) Earnings per share from discontinued operations Earnings per share attributable to shareholders, basic (in EUR) Earnings per share attributable to shareholders, diluted (in EUR) Average number of outstanding shares (basic) Average number of outstanding shares (diluted) 77,449,494 77,449,494 75,77,137 75,77,137 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME/LOSS JANUARY 1 TO DECEMBER 31, 21 in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Net profit/loss Foreign currency translation differences -2,463 4,563 4,12-2 Other comprehensive income/ loss, net of tax 4,563-2 Total comprehensive income/loss thereof non-controlling interests thereof shareholders' interests 2,1 8,376-6,276 3,812-4,495 8,37 75

80 CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED CASH FLOW STATEMENTS CONSOLIDATED CASH FLOW STATEMENTS JANUARY 1 TO DECEMBER 31, 21 in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Net profit/loss -2,463 4,12 Net loss from discontinued operations Deferred taxes Current taxes Financial result Profit (-)/loss (+) from investments in associated companies and joint ventures Amortization, depreciation and impairment and write-ups on intangible and tangible assets Profit (-)/loss (+) from disposal of non-current assets Other non-cash items Increase (-)/decrease (+) in inventories, trade accounts receivable and other assets not classified to investing or financing activities Decrease (-)/increase (+) in trade accounts payable and other liabilities not classified to investing or financing activities Dividends received from associated companies and joint ventures Interest paid Interest received Income taxes paid Income taxes received ,89 5, , ,355 77,393-3, ,557 1, -9,761 2, ,256 9,935 3,227-1, , ,346-99,943-6, ,729 1,453-5,992 3,255 Cash flow from operating activities, continuing operations 183,7 65,77 Change in cash and cash equivalents due to acquisitions of companies/shares in companies, net Payments for intangible assets Payments for film assets Payments for tangible assets Payments for financial assets Proceeds/payments due to sale of companies/shares in companies, net Proceeds from disposal of intangible assets and film assets Proceeds from disposal of tangible assets Proceeds from disposal of financial assets ,238-7,37-1, ,44-79,96-9,49 4, ,876 Cash flow for investing activities, continuing operations -86,61-64,22 76

81 JANUARY 1 TO DECEMBER 31, 21 in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Proceeds from capital increase and from issuance of equity instruments Payments for purchase of treasury stock Proceeds from sale of treasury stock Payments for purchase of non-controlling interests Proceeds from sale of non-controlling interests Repayment and buy-back of non-current financial liabilities Repayment and buy-back of current financial liabilities Proceeds from receipt of non-current financial liabilities Proceeds from receipt of current financial liabilities Dividend payments ,375-13,58-18,773 29,25 81,726-1,394 14,334-5,138 2,66-12, ,411-48,93 3, 15,55-3,924 Cash flow for financing activities, continuing operations -43,187-18,971 Cash flow for discontinued operations Cash flow from/for the reporting period 53,76-17,565 Cash and cash equivalents at the beginning of the reporting period Change in cash and cash equivalents due to exchange rate movements Cash and cash equivalents at the end of the reporting period 148,511 6,715 28, , ,511 Change in cash and cash equivalents 53,76-17,565 77

82 CONSOLIDATED FINANCIAL STATEMENTS CHANGES IN CONSOLIDATED EQUITY CHANGES IN CONSOLIDATED EQUITY JANUARY 1 TO DECEMBER 31, 21 in EUR Subscribed capital Treasury stock Capital reserve Other reserves Balance 1/1/21 85,131-7, ,989 9,45 Foreign currency translation differences 5,12 Changes in at-equity investments not affecting net income Other comprehensive income/loss 5,12 Net profit/loss Total comprehensive income/loss 5,12 Reclassification of prior year's net result Capital increase Change in treasury stock -55 Dividend payments Other changes -17,678 Balance 12/31/21 85,131-7, ,256 14,147 Balance 1/1/29 77,939-5, ,958 9,737 Foreign currency translation differences -91 Changes in at-equity investments not affecting net income Other comprehensive income/loss -91 Net profit/loss Total comprehensive income/loss -91 Reclassification of prior year's net result Capital increase 7,192 7,142 Change in treasury stock -1, Dividend payments Other changes -1,74-61 Balance 12/31/29 85,131-7, ,989 9,45 78

83 79 Shareholders interests 8,79-11,378-11,378-8,79-11, ,896 8,79 8,79 131,896 8,79 Noncontrolling interests 54, ,915 8, ,394-21,713 4,23 7, ,697-4,495-1,567-3,924-5,64 54,992 Equity attributable to the shareholders 54,79 5,12 5,12-11,378-6, ,676 3,783 35, ,79 8,37 14,334-1,55-1,79 54,79 Total 19,782 4,563 4,563-2,463 2, ,394-39,389 7,986 16, ,12 3,812 14,334-3,72-3,924-7,43 19,782 Accumulated loss -169,66 8, ,949-37, , ,66

84 CONSOLIDATED FINANCIAL STATEMENTS NOTES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1 General information The Management Board approved the consolidated financial statements on March 21, 211 for submission to the Company s Supervisory Board. 1.1 General information about the Group The Group parent company, Constantin Medien AG, has its registered office in Münchener Straße 11g, Ismaning, Germany. The Company is listed on the regulated market (Prime Standard) of the Frankfurt Stock Exchange. The operating business of the Constantin Medien Group encompasses the "Sports", "Film" and the "Sports- and Event- Marketing" Segments (see Note 8). 1.2 Basis of presentation The consolidated financial statements of Constantin Medien AG have been prepared pursuant to 315a (1) of the German Commercial Code (HGB) in accordance with International Financial Reporting Standards (IFRS), as adopted by the EU and additionally with requirements of the German Commercial Code. All IFRS/IAS and SIC/IFRIC are applied that were effective as of December 31, 21. assets, as well as financial assets and financial liabilities (including derivative financial instruments) at fair value through profit or loss. The preparation of the consolidated financial statements in conformity with IFRS requires Management to use estimates and assumptions that affect the classification and measurement of reported income, expenses, assets, liabilities and contingent liabilities up to the balance sheet date. These estimates and assumptions represent management's best estimate based on historical experience and other factors, including estimates about future events that are considered reasonable under given circumstances. The estimates and assumptions are continually reviewed. Changes in accounting estimates are necessary if changes occur in the circumstances on which the estimate was based or as a result of new information or additional findings. Such changes are recognized in the period of the change. Specific information on principles of estimates is separately described in Note 9 to these Notes. The consolidated financial statements are presented in Euros (EUR), which represent the functional and reporting currency of the Group s parent company. In general, the amounts are stated in thousands of Euros (TEUR or EUR ) except where otherwise indicated. An overview of the subsidiaries, joint ventures and associated companies included in the consolidated financial statements is provided in these Notes. The effects from first time consolidation and deconsolidation of subsidiaries, joint ventures and investments in associated companies are shown in the section Scope of Consolidation (see Note 3). The profit and loss account has been prepared according to the nature of expense method. The annual financial statements of the companies included in the consolidated financial statements are based on uniform accounting policies corresponding to the respective business activities. The consolidated financial statements have been prepared under the historical cost convention principle, as modified by the fair value measurement of available-for-sale financial 2 Accounting policies 2.1 Accounting standards and interpretations applied for the first time The Group applies IFRS 3, Business Combinations (revised) and IAS 27, Consolidated and Separate Financial Statements (revised) for the first time since the beginning of the financial year 21. The revised IFRS 3 largely results in changes to the accounting of the residual value of goodwill (option to use the "full goodwill model or the former "partial goodwill model ), the presentation of step acquisitions (revaluation of past acquisitions to profit or loss), the determination of acquisition costs (directly attributable incidental costs of acquisition are normally expensed immediately) and changes in individual aspects 8

85 of recognition and measurement of identifiable assets and liabilities. The new IFRS 3 has been applied for the first time to the 79 percent shareholding in Kontraproduktion AG, Zurich/ Switzerland acquired by Constantin Film Schweiz AG, Basel/ Switzerland in May 21. The impact from this transaction on the accompanying consolidated financial statements is presented in Note 3 to these Notes. The revised IAS 27 mainly results in changes to transactions with non-controlling interests and losses for non-controlling interests in the consolidated financial statements. In addition, retained interests under transitional consolidations are generally recognized at fair value through profit or loss. An increase or decrease in the investment interest held in a subsidiary is presented directly in equity, provided that the parent company continues to have control. The acquisition of the remaining 2 percent shareholding in Team Holding AG, Lucerne/Switzerland by Highlight Communications AG as well as the acquisition of the 21 percent interest in Kontraproduktion AG by Constantin Film Schweiz AG in the second and third quarter of the financial year have been presented directly as an equity transaction in conformity with IAS 27. The impact from these transactions on the accompanying consolidated financial statements is presented in Notes 3 to these Notes. The mandatory adoption of the following Standards and Interpretations did not materially impact the consolidated financial statements: Amendments to IFRSs 29/Improvement Project 29* IFRS 1, Amendments to IFRS 1 - additional exemptions for first-time adopters IFRS 1, First-time adoption of IFRS (amendment) IFRS 2, Share-based Payment: Group Cash-settled Sharebased Payment Transactions (amendment) IAS 39, Financial Instruments: Recognition and Measurement Eligible Hedged Items (amendment) IFRIC 12, Service Concession Arrangements IFRIC 15, Agreements for the Construction of Real Estate IFRIC 16, Hedges of a Net Investment in a Foreign Operation IFRIC 17, Distributions of Non-cash Assets to Owners IFRIC 18, Transfers of Assets from Customers * The following individual Standards and Interpretations have been impacted by this: IFRS 2, IFRS 5, IFRS 8, IAS 1, IAS 7, IAS 17, IAS 36, IAS 38, IAS 39, IFRIC 9, IFRIC Newly issued standards, revised standards and interpretations not yet applied The Constantin Medien Group waived the earlier adoption of the following new or revised Standards and Interpretations, which were endorsed by the EU already as of December 31, 21, but whose application is not yet mandatory for Constantin Medien AG as of December 31, 21: STANDARDS/INTERPRETATIONS Mandatory application for annual periods beginning on or after: IFRS 1, First-time Adoption of International Financial Reporting Standards Limited exemption from comparative IFRS 7 disclosures for first-time adopters IAS 24, Related Party Disclosures (amendment) IAS 32, Classification of Rights Issues (amendment) IFRIC 14, The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction (amendment) IFRIC 19, Extinguishing Financial Liabilities with Equity Instruments 7/1/21 1/1/211 2/1/21 1/1/211 7/1/21 81

86 CONSOLIDATED FINANCIAL STATEMENTS NOTES IAS 24, Related Party Disclosures (amendment) The changes mainly relate to the revision of the definition of related parties and the introduction of simplification provisions for entities that are under government ownership (so-called government-related entities ). The revised standard is to be applied for the first time for annual periods beginning on or after January 1, 211. The Group is currently evaluating the potential impact from the application of the revised standard, but does not expect any material effects at the present time. IAS 32, Classification of Rights Issues (amendment) IAS 32 presents clarification of the classification of rights issues between equity and debt in cases when the rights issues are denominated in a currency other than the functional currency. The changes are to be applied for the first time for annual periods beginning on or after February 1, 21. The amendments are not expected to materially impact the consolidated financial statements. The Constantin Medien Group waived the earlier adoption of the following new or revised Standards and Interpretations, which were not yet endorsed by the EU as of December 31, 21: STANDARDS/INTERPRETATIONS Mandatory application for annual periods beginning on or after*: IFRS 1, First-time Adoption of International Financial Reporting Standards (amendment) IFRS 7, Financial Instruments: Disclosures: Transfers of financial assets (amendment) IFRS 9, Financial Instruments (29) IFRS 9, Financial Instruments (21) IAS 12, Income Taxes (amendment) Improvement to IFRSs 21/ Improvement Project 21** 7/1/211 7/1/211 1/1/213 1/1/213 1/1/212 7/1/21 * provided that the EU has adopted said Standard by this date ** The following individual Standards and Interpretations have been impacted by this: IFRS 1, IFRS 3, IFRS 7, IAS 1, IAS 27, IAS 34, IFRIC 13 Of the above, the following Standards are of particular significance for Constantin Medien AG: IFRS 9, Financial Instruments IFRS 9 (29) and IFRS 9 (21) represent the first part of a three-part project (classification and measurement, impairment, hedge accounting) to completely replace the former accounting treatment of financial instruments under IAS 39, Financial Instruments: Recognition and Measurement. With the completion of each part of the project, the relevant sections under IAS 39 will be extinguished and the new rules under IFRS 9 introduced. IFRS 9 (29) addresses the classification and measurement of financial assets. Pursuant to IFRS 9, all financial assets are divided into two classification categories. One category is based on amortized cost and the other on fair value. Classification is made at the time the financial instrument is initially recognized. Equity instruments are to be measured at fair value. If an equity investment is not held for trading, there exists an irrevocable election at initial recognition to measure value changes from the subsequent measurement of the equity instrument directly to equity. However, dividend income shall be recognized in profit or loss. Supplemental to IFRS 9 (29), IFRS 9 (21) incorporates new requirements for the classification and measurement of financial liabilities. Other than the rules for the recognition of changes in fair value when applying the fair value option, IFRS 9 (21) does not contain any material changes in comparison to the accounting provisions under IAS

87 The application of IFRS 9 is mandatory for annual periods beginning on or after January 1, 213. Earlier application is permitted. Constantin Medien AG is currently evaluating the potential impact from the application of the revised Standard. 3 Scope of consolidation The following changes in the scope of consolidation arose during the fiscal year 21: Acquisitions, new formations and first time consolidation Kontraproduktion AG, Switzerland On May 14, 21, Constantin Film Schweiz AG, Basel, acquired 79 percent of the shares in Kontraproduktion AG, Zurich, at a purchase price of EUR 6. The operating business of Kontraproduktion AG largely comprises the production of theatrical and television films. In conformity with IFRS 3.45 initial consolidation is preliminary, because in respect of the purchase price allocation additional information could arise as part of the fair value measurement. The transaction mainly consisted of the acquisition of film assets (EUR 3.8 million), cash and cash equivalents (EUR.1 million), advance payments received (EUR 1.9 million), trade accounts payable (EUR 1.8 million) and other liabilities (EUR.2 million). A difference amount did not arise from the business combination. Sales from Kontraproduktion AG, which have been taken into account in the consolidated financial statements since May 14, 21, amount to TEUR 1,249. The effects on earnings since first time consolidation amount to TEUR On August 13, 21, Constantin Film Schweiz AG acquired the remaining shareholding interest of 21 percent in Kontraproduktion AG at a purchase price of EUR 2. The transaction did not have a material effect on shareholders' equity and noncontrolling interests. It is planned to recapitalize the company with about TEUR 241. If Kontraproduktion AG would have been acquired as of January 1, 21 and it would have been fully consolidated in the Constantin Medien Group, sales of TEUR 1,251 and contribution to earnings of TEUR 344 would have arisen. Team Holding AG, Switzerland On June 3, 21, Highlight Communications AG acquired a 2 percent shareholding in Team Holding AG from UEFA. Therefore, Highlight Communications AG holds 1 percent of the capital of Team Holding AG starting on this date. The purchase price amounts to EUR 3. million plus a profit-related purchase price payment of EUR 1. million. The profit-related purchase price payment is due on January 16, 213 upon reaching a performance target set between the completion of the transaction and January 15, 213. If this performance target is reached, which is currently anticipated by the Highlight Communications group, the agency agreement between the TEAM group and the UEFA will be extended automatically at least until June 218. Constantin Entertainment Middle East FZ LLC, VAE On July 22, 21, Constantin Entertainment GmbH formed Constantin Entertainment Middle East FZ LLC, Abu Dhabi/UAE. The company is fully consolidated in the group consolidated financial statements of Constantin Medien AG for the first time as of that date. Constantin Entertainment SRB d.o.o., Serbia On August 31, 21, Constantin Entertainment GmbH formed Constantin Entertainment SRB d.o.o., Belgrade/Serbia. The company is fully consolidated in the group consolidated financial statements of Constantin Medien AG for the first time as of that date. Overview of fully consolidated subsidiaries Constantin Medien AG fully consolidates Highlight Communications AG on the basis of de facto control, because Constantin Medien AG assumes that - similar to the annual shareholders' meeting 29/21 - it will possess a quorum majority presence at future annual shareholders' meetings of Highlight Communications AG. Moreover, the company Resident Evil Productions LLC, Delaware/USA in which neither direct nor indirect interests exist, was fully consolidated through Constantin Film AG in conformity with SIC

88 CONSOLIDATED FINANCIAL STATEMENTS NOTES OVERVIEW OF FULLY CONSOLIDATED SUBSIDIARIES in 21 Location of the company Shareholding in % Period of inclusion Constantin Sport Holding GmbH* Ismaning 1. 1/1 to 12/31 Sport1 GmbH Ismaning 1. 1/1 to 12/31 DSF Internet GmbH Ismaning 1. 1/1 to 12/31 Constantin Sport Medien GmbH Ismaning 1. 1/1 to 12/31 PLAZAMEDIA GmbH TV- und Film-Produktion* Ismaning 1. 1/1 to 12/31 PLAZAMEDIA Austria Ges.m.b.H. Vienna/Austria 1. 1/1 to 12/31 PLAZAMEDIA Swiss AG Wollerau/Switzerland 1. 1/1 to 12/31 PMM Sports Production GmbH Ismaning 1. 1/1 to 12/31 Constantin Sport Marketing GmbH* Ismaning 1. 1/1 to 12/31 Brandsome GmbH Ismaning 1. 1/1 to 12/31 EM.TV Finance B.V. Amsterdam/Netherlands 1. 1/1 to 12/31 ACC-Agentur für Communication und Concept Gesellschaft für Public Relation GmbH i.l. Ismaning 1. 1/1 to 12/31 Life On Stage GmbH i.l. Ismaning 1. 1/1 to 12/31 EM.TV Verwaltungs GmbH Ismaning 1. 1/1 to 12/31 EM.TV Beteiligungs GmbH & Co. KG Ismaning 1. 1/1 to 12/31 EM.TV Supply GmbH i.l. Ismaning 1. 1/1 to 12/31 Highlight Communications AG**** Pratteln/Switzerland /1 to 12/31 Team Holding AG Lucerne/Switzerland 1. 1/1 to 12/31 Team Football Marketing AG Lucerne/Switzerland /1 to 12/31 T.E.A.M. Television Event And Media Marketing AG Lucerne/Switzerland 1. 1/1 to 12/31 KJP Holding AG Lucerne/Switzerland 1. 1/1 to 12/31 Rainbow Home Entertainment AG Pratteln/Switzerland 1. 1/1 to 12/31 Constantin Film Schweiz AG Basel/Switzerland 1. 1/1 to 12/31 Kontraproduktion AG Zürich/Switzerland 1. 5/14 to 12/31 Rainbow Home Entertainment Ges.m.b.H. Vienna/Austria 1. 1/1 to 12/31 Highlight Communications (Deutschland) GmbH Munich 1. 1/1 to 12/31 * Companies, which claim the disclosure option under 264 (3) of the German Commercial Code (HGB). ** The company is held by Constantin Film Produktion GmbH (5%) and Constantin Film International GmbH (5%). *** The company is held with a shareholding of.3% by Constantin Film Produktion GmbH. **** Taking into account the treasury shares held by Highlight Communications AG, the capital share amounted to 48.48%. The companies in which Highlight Communications AG is holding shares, are to be calculated with a shareholding of 47.3%. 84

89 OVERVIEW OF FULLY CONSOLIDATED SUBSIDIARIES in 21 Location of the company Shareholding in % Period of inclusion Constantin Film AG Munich 1. 1/1 to 12/31 Constantin Media GmbH audiovisuelle Produktionen* Munich 1. 1/1 to 12/31 Constantin Film Produktion GmbH* Munich 1. 1/1 to 12/31 Constantin Television GmbH* Munich 1. 1/1 to 12/31 Constantin Film Services GmbH* Munich 1. 1/1 to 12/31 Constantin Film Development Inc. Los Angeles/USA 1. 1/1 to 12/31 Constantin Production Services GmbH Los Angeles/USA 1. 1/1 to 12/31 DoA Production Ltd. London/UK 1. 1/1 to 12/31 Resident Evil Mexico S. DE R.L. DE C.V.** Mexicali/Mexico 1. 1/1 to 12/31 Constantin Film International GmbH * Munich 1. 1/1 to 12/31 Constantin Pictures GmbH* Munich 1. 1/1 to 12/31 Constantin Entertainment GmbH* Ismaning 1. 1/1 to 12/31 Constantin Entertainment Polska Sp. Z o.o Warsaw/Poland 75. 1/1 to 12/31 Constantin Entertainment U.K. Ltd. Reading/UK 1. 1/1 to 12/31 Constantin Entertainment Croatia d.o.o. Zagreb/Croatia 1. 1/1 to 12/31 Constantin Entertainment Turkey TV Prodüksiyon Limited Sirketi*** Sirketi/Turkey 1. 1/1 to 12/31 Constantin Entertainment Hellas EPE Athens/Greece 1. 1/1 to 12/31 Constantin Entertainment Middle East FZ LLC Abu Dhabi/VAE 1. 7/22 to 12/31 Constantin Entertainment SRB d.o.o. Belgrade/Serbia 1. 8/31 to 12/31 Olga Film GmbH Munich /1 to 12/31 Moovie the art of entertainment GmbH Berlin 51. 1/1 to 12/31 Rat Pack Filmproduktion GmbH Munich 51. 1/1 to 12/31 Westside Filmproduktion GmbH Krefeld 51. 1/1 to 12/31 Constantin Film Verleih GmbH* Munich 1. 1/1 to 12/31 Classic Media Werbeagentur GmbH* Munich 1. 1/1 to 12/31 Constantin International B.V. Amsterdam/Netherlands 1. 1/1 to 12/31 Constantin Music Verlag GmbH* Munich 1. 1/1 to 12/31 Constantin Music GmbH Munich 9. 1/1 to 12/31 Königskinder Music GmbH Munich 5. 1/1 to 12/31 Constantin Family GmbH* Munich 1. 1/1 to 12/31 * Companies, which claim the disclosure option under 264 (3) of the German Commercial Code (HGB). ** The company is held by Constantin Film Produktion GmbH (5%) and Constantin Film International GmbH (5%). *** The company is held with a shareholding of.3% by Constantin Film Produktion GmbH. **** Taking into account the treasury shares held by Highlight Communications AG, the capital share amounted to 48.48%. The companies in which Highlight Communications AG is holding shares, are to be calculated with a shareholding of 47.3%. 85

90 CONSOLIDATED FINANCIAL STATEMENTS NOTES Overview of non-consolidated companies The following subsidiaries are individually and as a whole of immaterial significance for the true and fair view of the Group's net assets, financial position and results of operations. Therefore, these companies are not included in the scope of consolidation of Constantin Medien AG. The non-consolidated companies have been reported at a carrying value of TEUR. The companies are currently inactive and have no operations. The estimated fair value is approximately equivalent to the carrying value. NON-CONSOLIDATED COMPANIES in 21 Country Currency Share capital in EUR Shareholding in capital in % Société Nouvelle Torii S.A.R.L.* Paris/France EUR Greenland Film Production A.B.* Stockholm/Sweden SKR 1 1. Smilla Film A.S.* Copenhagen/Denmark DKR 5 1. Constantin Music Publishing US Inc.* Los Angeles/USA USD 1 1. She s French LLC** Los Angeles/USA USD 1 1. Impact Pictures LLC** Delaware/USA USD Impact Pictures Ltd.*** London/UK GBP Constantin Entertainment Adria d.o.o.**** Zagreb/Croatia HRK 2 1. T.E.A.M. UK***** Reading/UK GBP 1. * Investment of Constantin Film Produktion GmbH ** Investment of Constantin Pictures GmbH *** Investment of Impact Pictures LLC **** Investment of Constantin Entertainment GmbH ***** Investment of T.E.A.M Television Event and Media Marketing AG In addition, Constantin Medien managed three (29: three) non-consolidated shell companies. Overview of interests in joint ventures The interest in the joint venture listed below is included in the consolidated financial statements using the equity method: A detailed illustration of assets, liabilities, income and period results of the interests in joint ventures is presented under Note 5.4. JOINT VENTURES in 21 Shareholding in % Period of inclusion Currency Equity in EUR Net result from the most recent financial year in EUR PolyScreen Produktionsgesellschaft für Film und Fernsehen mbh, Munich 5. 1/1 to 12/31 EUR Overview of investments in associated companies The investments in associated companies presented below are included in the consolidated financial statements using the equity method. A detailed illustration of assets, liabilities, income and period results of the investments in associated companies is presented under Note

91 ASSOCIATED COMPANIES in 21 Shareholding in % Period of inclusion Currency Equity in EUR Net result from the most recent financial year in EUR BECO Musikverlag GmbH, Hamburg* 5. 1/1 to 12/31 EUR Escor Casinos & Entertainment SA, Düdingen/Switzerland** /1 to 12/31 CHF 24, NEF-Production S.A.S., Paris/France 3. 5/31 to 12/31 EUR * This deals with the figures as of December 31, 29, because the financial statements for 21 are not yet available. ** Taking into account the treasury shares held by Escor Casinos & Entertainment SA, the capital share amounted to 27,55%. 4 Accounting and valuation principles 4.1 Consolidation methods All material subsidiaries are included at full consolidation in the consolidated financial statements. Subsidiaries are companies in which Constantin Medien AG can directly or indirectly exercise control. Control constitutes the power to govern the financial and business operations of the subsidiary so as to obtain benefits from its activities. This is normally the case when Constantin Medien AG directly or indirectly holds more than 5 percent of the voting rights or potential voting rights of a company. Companies in which Constantin Medien AG directly or indirectly holds 5 percent or less than 5 percent of the voting rights, but exercises de facto control are also included at full consolidation in the consolidated financial statements of Constantin Medien AG. Under de facto control, control arises neither from potential voting rights nor contractual or other agreements. Constantin Medien AG has de facto control if it can exercise control at any time at the general/ annual or shareholders' meetings on the basis of its voting rights without other shareholders joining together to establish a quorum presence majority. Special purpose entities (SPEs) are included in the consolidated financial statements in case the Group controls the SPE on the basis of the nature of the relationship to the SPE. In accordance with IFRS 3, the first time capital consolidation is carried out by offsetting the acquisition costs of the investment against the revalued proportionate equity share in the subsidiary at the date of acquisition. For this purpose, assets and liabilities (including contingent liabilities) are stated at their fair values regardless of the amount of any non-controlling interests in equity. Acquisition-related costs are expensed in the period incurred. The remaining positive difference amount is recognized as goodwill, which is subject to an annual impairment test or tested whenever triggering events for impairment arise. Any impairment loss arising from this is immediately expensed. Any negative difference arising from capital consolidation following a re-assessment is reported in full as income in the year incurred. For each business combination the acquirer can elect to measure non-controlling interests either at fair value or at the non-controlling interest s proportionate share of the acquiree s identifiable net assets. The consolidation of interests in joint ventures, that is companies jointly managed by the Group and other partners, is conducted according to the equity method pursuant to IAS Investments in companies in which Constantin Medien AG exerts significant influence, generally through an ownership interest between 2 and 5 percent of the voting rights (associated companies) are accounted for using the equity method. The investments are recognized at their acquisition costs at the acquisition date. Any identified goodwill is included in the net carrying value and is not separately recognized. The earnings of the associated companies are recognized by the Group on a proportionate basis and are attributed to the investment's net carrying value. Profit distributions from the associated companies reduce the investment s net carrying value. Impairment is subject to IAS 36, if triggering events for impairment arise. Changes recognized directly in the equity of the associated 87

92 CONSOLIDATED FINANCIAL STATEMENTS NOTES company are recognized by the Group to the extent of its holding and are shown in changes in consolidated equity. Companies are deconsolidated in conformity with IAS 27 when the exercise of control in the respective company ceases. Deconsolidation represents a disposal of all assets including goodwill and liabilities as well as differences arising from foreign currency translation attributable to the subsidiary. Income and expenses incurred up through this date continue to be taken into account in the consolidated financial statements. The effects from intercompany transactions have been eliminated. Receivables and payables between fully consolidated companies are offset against each other. Interim profits are eliminated. Intercompany income is offset against the corresponding expense. Non-controlling interests represent that portion of profit or loss and net assets of the subsidiary not attributable to the shareholders of the parent company. Non-controlling interests are separately reported in the consolidated profit and loss account and consolidated balance sheet. Classification in the consolidated balance sheet is shown within the equity section separately from the equity attributable to the shareholders' interests. The effects from transactions with non-controlling interests that do not result in a loss of control are recognized directly in equity as transactions with equity holders. For transactions resulting in a loss of control, the gain or loss incurred therefrom is recognized to profit or loss. The gain or loss also contains the effect from the remeasurement of retained interests at fair value. 4.2 Foreign currency translation Functional currency The functional currency of Constantin Medien AG as well as the Group's reporting currency is the Euro currency. For a majority of the consolidated companies the local currency is the respective functional currency. Some consolidated companies have a local currency that is not identical with its functional currency, to the extent that its local currency is not the currency of the economic environment in which the company mainly conducts its business. Translation of foreign currency balances and transactions Monetary assets and liabilities are translated at the balance sheet date using closing rates. Transactions in currencies that are not the functional currency of the respective consolidated company are recognized by the company using the exchange rate in effect as of the transaction date. Gains and losses from the settlement of these transactions and from the translation of monetary assets and liabilities are recognized to profit or loss. An exception arises for gains and losses from qualified cash flow hedges and from monetary items which from a business management standpoint are a component of the net investment in a foreign entity of the Group. Such gains and losses are recognized in the equity section of the balance sheet. Translation differences from non-monetary financial instruments held for sale are also recognized directly to equity. Translation differences from monetary financial instruments held for sale are recognized as changes in fair value without impacting profit or loss. In 21, translation differences in the amount of TEUR 3,271 (29: TEUR 141) were recognized to profit or loss. Gain or losses from cash flow hedges and from net investments in a foreign entity did not arise. Foreign currency translation within the Group The balance sheets of the foreign subsidiary stated in a functional currency other than the Euro are translated according to the functional currency method at the midrates as of the balance sheet date; profit and loss items are translated at average rates for the year. Goodwill and fair value changes from purchase price allocation denominated in functional currencies other than the Euro currency are also translated at the rate as of the balance sheet date. The differences arising from this and from foreign currency translation of prior year amounts brought forward are recognized directly in equity. Upon the sale of a foreign consolidated company, cumulative translation differences from the translation of assets and liabilities of that company are recognized as part of the gain or loss on sale in the profit and loss account. 88

93 Foreign exchange rates The closing rates are based on the midrates on the last trading day of the respective financial year. FOREIGN EXCHANGE RATES 1 Euro Period-end exchange rate Average rate 12/31/21 12/31/29 1/1 to 12/31/21 1/1 to 12/31/29 Switzerland CHF USA USD UK GBP Canada CAD Poland PLN Croatia HRK Mexico MXN Turkey TRY Segment reporting The distinction of segments and segment reporting are conducted on the basis of the internal reporting of the organizational unit to the chief operating decision maker with respect to the allocation of resources and assessment of performance. The entire Management Board has been identified as the chief operating decision maker. The determination of the business segments of the Group is based on the organizational units who report to the Group. The Group comprises of the segments Sports, Film as well as Sports- and Event-Marketing. Certain Group management functions are shown as Others. These include Group Management, Corporate Finance, Investor Relations, Controlling, Legal, Group Accounting, Corporate Communications, Internal Audit and Human Resources. The EBIT (profit from continuing operations) corresponds to the segment result, because it is used as a performance indicator for internal purposes. 4.4 Film assets Film assets include both acquired rights in third party productions (i.e. films not produced by the Group) and production costs for films produced within the Group (in-house and co-productions) as well as costs for developing new projects. The acquisition of rights in third-party productions normally encompasses theatrical, home entertainment and TV rights. The costs for third-party productions generally comprise of minimum guarantees. The single installment payments of the minimum guarantee are recognized as advance payments received and capitalized as film assets upon delivery and acceptance of the materials. In-house productions are stated at their production costs. Production costs also include financing costs attributable to the respective production. In addition, costs are incurred for the release of film titles, such as press and marketing costs. The release costs are not capitalized, but immediately recognized as expenses. The amortization of film rights (both third-party and in-house productions) is conducted on the basis of a unit of production method, which shows the consumption of film rights as a factor of the revenues that can be achieved. This method is known as the "individual film forecast method. According to this method, a film title is amortized in the period on the basis of a quotient revenues generated from the film in the period divided by estimated remaining total revenues generated by the film multiplied by the residual carrying value of the film. The estimate of ultimate revenues used in calculating amortization includes all income generated by the film. With respect to 89

94 CONSOLIDATED FINANCIAL STATEMENTS NOTES video sales revenues, amortization is based on external sales revenues adjusted by video costs. For films, accounted for as film assets by Constantin Film, the maximum period for estimating revenues is ten years. The estimation of total revenue is reviewed at the end of each quarter and adjusted, if necessary. The quotient for the amortization charge is determined on the basis of any adjusted total revenue. An impairment test is conducted for every film title when triggering events arise. If acquisition costs or the carrying value of a film title are not covered by estimated total revenues less release costs to be incurred, a write-down is made to the value in use. In determining the value in use, the estimated cash flows are discounted by an individual interest rate that takes into account the periods of the various degrees of evaluation. When viewed across the various degrees of evaluation, the pre-tax interest rates range from 5.5 up to 8.3 percent (previous year: up to 4.8 percent). Estimated cash flows can be significantly impacted by a number of factors, such as market acceptance. The Constantin Medien Group examines and revises sales forecasts and amortization and write-downs as soon as changes arise in the previous forecast data used. Capitalized costs for the development of new projects (in particular, screenplay/script rights) are regularly reviewed as to whether they can still be used as a basis for film productions. If, after three years of initial capitalization of project costs, the start of shooting or sale of rights are not yet reliably measurable, the costs are fully written-down. Upon incurrence of triggering events, an impairment charge is recognized accordingly. 4.5 Other intangible assets This category encompasses primarily EDP programs and intangible assets realized as part of purchase allocations that are stated at cost less scheduled straight-line amortization and impairment charges. Further additional details can be found under the section Impairment of non-financial assets (see Note 4.8). The amortization of EDP programs is generally based on a normal operating estimated life of three years. The brand name Constantin is recorded as an indefinite-lived intangible assets. This asset is not subject to amortization, but is instead tested for impairment once a year and during the year if triggering events should arise. 4.6 Goodwill Goodwill is recognized at cost less any accumulated impairment losses. The acquisition costs of goodwill are measured as the sum of (i) the acquisition-date fair value of the consideration transferred; (ii) the amount of any non-controlling interests; and (iii) in a business combination achieved in stages, the acquisition-date fair value of the acquirer's previously-held equity interest in the company acquired less the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities and contingent liabilities measured at fair value. Non-controlling interests can be measured on a transaction-by-transaction basis, either at fair value (full goodwill method) or at the non-controlling interest's proportionate share of the net identifiable assets of the company acquired. In the latter treatment, goodwill is measured only on the acquirer's percentage share of the goodwill amount. Additions to goodwill are allocated to the respective cash-generating units from which the use of benefits from the business combination is expected to be derived. The cash-generating units to which goodwill has been allocated represent the organization units beneath the segment or the segments. In accordance with IAS 36 an impairment test is performed once a year as well as during the year if triggering events should arise that indicates a possible impairment. Pursuant to IFRS 3 goodwill is not amortized. 4.7 Tangible assets Tangible assets comprise land, property rights and buildings, leasehold improvements, technical equipment and machinery, other equipment, plant and office equipment as well as advance payments and assets under construction. Land, property rights and buildings are recognized at acquisition cost less scheduled depreciation based on an estimated useful life of in case of buildings 27.5 years. The acquisition costs for leasehold improvements are normally depreciated over the length of the respective lease agreement. Technical equipment and machinery as well as plant and office equipment are recognized at acquisition cost less scheduled depreciation and impairment loss, if any. Scheduled depreciation is on a straight-line basis over an estimated useful life of between three and 25 years. Repairs and maintenance costs are charged directly to income on the date incurred. Extensive reno- 9

95 vations or leasehold improvements are capitalized. Renovations are also depreciated over the aforementioned estimated useful life. In case of disposal of an asset, the acquisition cost and related accumulated depreciation is derecognized. The gain or loss arising from disposal is recognized in the profit and loss account. 4.8 Impairment of non-financial assets Goodwill and intangible assets with an indefinite useful life are tested once a year for impairment in accordance with IAS 36 and during the fiscal year if triggering events indicate possible impairment. The annual impairment test is conducted by Constantin Medien AG in the fourth quarter of the respective financial year. Other intangible assets and tangible assets are subject to impairment testing according to IAS 36 if there is any indication that an asset may be impaired. A triggering event for impairment would be a material fair value reduction of an asset, significant changes in the business environment, substantial indication of obsolescence or changes in revenue forecasts. The basis for the impairment test is the calculation of the recoverable amount, which is the higher of the fair value less costs to sell and the value in use of an asset. If the calculation of the recoverable amount is made in the form of its value in use, corresponding cash flows are used. Where the recoverable amount is below the carrying value an impairment loss shall be recognized. The determination of the recoverable amount contains estimates and assumptions by management. The estimates and assumptions underlie parameters based on current information available. Changes in information available or circumstances that are beyond the company's influence could result in actuals different to the initial assumptions and estimates, which could lead to adjustments in the net carrying value. Where the calculated impairment amount exceeds the goodwill attributable to the cash-generating unit, the unit's other assets shall be written-down in relation to their net carrying values. This does not apply if the respective net carrying value would fall below the higher of the fair value less costs to sell. exists. If reversals arise, the write-up amount is recognized to profit or loss up to a maximum of the amortized cost. 4.9 Inventories Service productions under development Inventories contain service productions that have not yet been assigned by a broadcaster (see Note 4.23 Service productions). Merchandise Merchandise, mostly consisting of DVDs and Blu-rays, is recognized at acquisition or production costs or the lower net realizable value (sales-oriented, loss-free measurement) in accordance with the lower of cost or market value principle. The net realizable value is the estimated selling price in the ordinary course of business less the selling costs. Acquisition or production costs are determined by the first-in, first-out method (FIFO). Write-downs to merchandise (such as DVDs and Blu-rays) are determined on the basis of coverage analysis. Accordingly, management analyzes each product based on the historical movements and on products on hand for any indication of impairment. Should indications of impairment for individual products arise, then such items are written-down. Additional valuation allowances have been recognized for damaged or defect merchandise. Raw materials and supplies Raw materials and supplies are stated at cost or the lower expected net realizable value. Acquisition or production costs are determined by the average method. Slow-moving or nonmarketable balances are written-down in full. 4.1 Non-current assets held for sale and disposal groups Classification to the category held for sale requires the existence of individual non-current assets or a disposal group that are available for immediate sale in its present condition and its sale must be highly probable. Non-current assets or a disposal group are stated at the lower of its carrying value and fair value less costs to sell. Scheduled depreciation is no longer recognized on non-current assets held for sale. Regarding intangible assets (except for goodwill) and tangible assets, reversals of impairment losses recognized in prior periods are to be reported if the reason for impairment no longer 4.11 Assets and liabilities from discontinued operations Discontinued operations deal with business operations that are either deemed for sale or already sold and its business 91

96 CONSOLIDATED FINANCIAL STATEMENTS NOTES activities and cash flows can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the business activities. Discontinued operations are to be reported separately in the profit and loss account and in the cash flow statement Financial instruments Regular way purchases or sale of financial assets are accounted for on the settlement date. Available-for-sale financial assets This category comprises predominantly financial assets not classifiable to other categories under IAS 39 as well as investments in shell companies which do not have operating activities. The financial assets are measured at fair value. Susequent measurement is at fair value which corresponds to the stock price as of the balance sheet date. If there is no market value, the fair value is determined on the basis of comparable market transactions or accepted valuation methods. Any gain or loss arising from measurement as of the balance sheet date is recognized directly to equity. If the fair value of an equity instrument cannot be reasonably measured, the equity instrument is carried at amortized cost. Recognition to profit or loss first occurs upon derecognition of such financial assets. In contrast, any impairment loss is recognized to profit or loss. Where an active market does not exist or no longer exists, the fair value of the financial instruments is determined on the basis of recognized valuation methods. For financial investments in equity instruments where a listed price does not exist on an active market and its fair value cannot be reliably measured, the cost value is applied. If write-downs are taken on such financial instruments, such write-downs may not be cancelled. At each balance sheet date or if any indication exist that an asset may be impaired, it is assessed whether an impairment of financial assets is necessary. Impairment charges to debt instruments available-for-sale are reversed through profit or loss in subsequent periods, if the reason for impairment no longer exists. Subsequent changes in the fair value are recognized directly to equity. Impairment charges to equity instruments available-for-sale are not reversed through profit or loss, but increase to the fair value after impairment are recognized directly to equity. Management classifies financial assets at the time of acquisition and reviews this classification at regular intervals to determine whether the criteria for classification still apply. Generally, the acquisition costs include transaction costs. In respect of financial assets at fair value through profit and loss transaction costs are expensed as incurred. Held-to-maturity financial investments Held-to-maturity financial investments are non-derivative financial assets with fixed or at least determinable payments and fixed maturity that the Group has the positive intention and ability to hold to maturity. As in the previous year, there were no held-to-maturity financial investments as of December 31, 21. Loans and receivables Financial instruments classified to this category are carried at amortized cost using the effective interest method. Current trade accounts receivable as well as other current receivables are stated at cost. Non-interest-bearing monetary receivables maturing after one year are discounted at a termadequate interest rate. If collectability of the receivable is doubtful, customer receivables are stated at the lower realizable amount. A write-down is recognized if objective information, particularly regarding the creditworthiness of the respective customer, current industry-specific business trends and an analysis of defaults on receivables in the past, indicates that the company will not collect all amounts upon their maturity dates. The net carrying amounts are approximately equivalent to the fair value. In addition, portfolio write-downs are recognized for receivables with differing risk classes, which take account of historical default rates. The respective receivables are then written-down according to an average default rate. Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss are generally shown under the line item other financial assets. The category of financial assets at fair value through profit or loss generally contains financial assets held for trading and financial assets 92

97 designated by the company upon initial recognition as at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for purpose of selling them in the near future. Derivatives are also classified as held for trading, except for derivatives relating to financial guarantees or designated as a hedging instrument and as such are effective (hedge accounting). Financial assets are initially designated as financial assets at fair value through profit or loss if such classification eliminates or substantially reduces mismatching arising from the recognition of assets otherwise undertaken or the recognition of gains and losses from different accounting policies or if a group of financial assets and/or financial liabilities are assessed according to a documented risk management or investment strategy and its growth is assessed on the basis of its fair value and the information about this group determined on this basis is submitted internally to key executives of the Company. Measurement is at fair value. Realized gains and losses from changes in the fair value of the financial instruments are reported to the profit and loss account on the date incurred. Subsequent measurement is at fair value which corresponds to the stock price as of the balance sheet date. If there is no market value, the fair value is determined by applying a valuation method. Valuation methods include the application of most recent business transactions between knowledgeable, willing parties in an arm's length transaction, comparison with current fair values of another, mostly identical financial instrument, as well as analysis of discounted cash flows and use of other valuation models. As a rule, financial assets and financial liabilities are not presented at net amount; they are only offset when, and only when, there is a right to set off the recognized amounts at the present time and it is intended to settle on a net basis Hedge accounting The Group basically applies derivative financial instruments to hedge against exchange rate fluctuation for film rights purchased in foreign currencies. Film rights were largely purchased in the US dollar. Hedge accounting is intended to mitigate the risk of changes in the fair values of an asset. In this case, the hedged item designated for firm commitments from film rights purchases not yet accounted for should be hedged, because this underlies exchange rate fluctuation upon entering the contract and until its settlement. Forward exchange contracts are applied as hedging instruments. These are either designated in whole or in parts. The accounting treatment of the hedging relationship is recognized as a fair value hedge. Accordingly, opposite changes in the fair values of hedged items and hedging instruments are recognized to profit or loss, such that the profit or loss is offset. Such hedging relationships are considered to be highly effective if an offsetting of the risks from changes in the fair values of the hedged item and hedging instruments is achieved. They are continuously evaluated as to whether they were in fact effective during the entire reporting periods for which the hedging relationship was designated. The effectiveness of a hedging relationship is examined on the basis of prospective and retrospective effectiveness tests. The prospective effectiveness test is performed according to the critical term match method. Under the retrospective effectiveness test, the dollar offset method is applied. Effectiveness is the degree to which changes in the fair values of the hedged item and hedging instrument are offset. To the extent that an offset is achieved within a range of between 8 to 125 percent, then the hedging relationship is considered to be effective. The hedging relationships all lie within this range without exception. At the inception of a hedge, both the hedging relationship and the risk management objectives and strategies of the Group with respect to hedging are formally determined and documented Cash and cash equivalents Cash and cash equivalents comprise cash on hand, cash and deposits held at call and consigned money with banks and other financial institutions. These items are only recognized as liquid funds if they are convertible to known amounts of cash and cash equivalents at any time, are exposed to only minor fluctuations in value and have an original maturity of or less than three months starting from the date of acquisition. 93

98 CONSOLIDATED FINANCIAL STATEMENTS NOTES 4.15 Share-based compensation Constantin Medien AG has share option programs that deal with the settlement of equity instruments. All share option programs have exceeded the tender period since the financial year 27. Expenses arising from the share option programs were therefore no longer recognized in the profit and loss accounts for the financial years 21 and 29, respectively. Cash inflows from exercising share options are recognized on the date of exercise less directly attributable transaction costs under share capital and in the capital reserve Liabilities Liabilities consist of non-current and current financial liabilities, trade accounts payable, advance payments received and other liabilities and are recognized at amortized cost. Derivative financial instruments with a negative fair value on the balance sheet date are stated at fair value and reported under other liabilities. Low or non-interest-bearing non-current liabilities are initially measured at present value and accrue interest until maturity. Liabilities for outstanding invoices are shown under trade accounts payable and other liabilities. The pension obligations have been determined on the basis of actuarial reports. The actuarial valuation of defined benefits and other similar post-employment benefits shown under the provisions for pensions and other similar obligations is calculated using the projected unit credit method. The projected unit credit method prescribes the measurement of future obligations on the basis of allocable pension benefits accrued as of the balance sheet date. The valuation takes into account actuarial assumptions as to the discount factor for calculating the present value of obligations, the projected future development of salaries and pensions and the long-term expected return on plan assets. The discount factors are based on the market yields of premium industrial bonds. Actuarial gains and losses, which include differences between assumptions and actual experience and remeasurement effects within the actuarial assumptions, are allocated to the profit and loss account over the expected remaining period of service of active employees if such gains or losses exceed the corridor (1 percent of the greater of plan assets or pension benefit obligations). The liability and equity components in compound financial instruments such as convertible bonds are to be separated and accounted and measured separately according to the requirements under IAS Pension liabilities Post-employment benefit obligations encompass both defined benefit as well as defined contribution plans. The most important post-retirement benefit plans are in Switzerland. Practically all employees in Switzerland are members of a benefit plan based on the Swiss defined-contribution system which surpasses the minimum requirements governed by Swiss law. Contributions are paid by the individual companies and employees. The employees' contributions are defined as a percentage of their assured annual salary and deducted on a monthly basis. The amounts deducted from salaries to cover the post-retirement benefits vary according to age. The benefits cover old-age pension, invalidity benefits, benefits in the event of death and benefits for surviving dependants. These post-employment plans fall within the scope of IAS 19 and are subject to the provisions for defined benefit plans. The liabilities reported in the balance sheet correspond to the amount of the obligation less the fair value of plan assets and unrecognized actuarial gains and losses. In the case of defined contribution plans, the company pays contributions to publicly or privately administered pension schemes on a mandatory, contractual or voluntary basis. Once the contributions have been paid, the company has no further payment obligations. The contributions paid are directly expensed in the respective year. Furthermore, the TEAM Group maintains a support foundation for its management staff, organized as a so-called savings institution. In addition to the statutory pension scheme, this foundation holds also an additional savings device. The foundation holds a share in the capital of Team Football Marketing AG. The dividend income of Team Football Marketing AG is added to the savings deposits of the members of management. There were no contributions charged to the profit and loss account Other provisions, contingent liabilities and contingent assets As defined by IAS 37 provisions are recognized for currently existing obligations arising from past events that will probably 94

99 give rise to a future outflow of funds, provided that a reliable estimate can be made of the obligation amount. Provisions are measured in the amount of expected outflow of resources that is most likely to occur. Non-current provisions with a material interest effect are recognized at the present value of the expected cash outflow using the current market rate of interest. Deferred tax assets and deferred tax liabilities are offset if they relate to income taxes levied by the same taxation authority and have the same maturity. Deferred tax assets and liabilities from fiscal unity companies are offset. The accounting of tax items often requires the use of estimates and assumptions which may vary from the actual tax charges at a later date. Provisions for onerous contracts (pending losses) are recognized when the unavoidable costs of meeting the obligation under the contract exceed the economic benefits expected to be received under it. Before a separate provision for an onerous contract is established, any impairment loss that has occurred on assets dedicated to that contract is recognized. Possible obligations whose existence (occurrence, non-occurrence) must be confirmed by future events, or obligations whose extent cannot be reliably determined are disclosed as contingent liabilities. Contingent assets are not capitalized, but also disclosed as in the case of contingent liabilities, if a economic benefit is probable for the Group Borrowing costs Borrowing costs directly attributable to qualifying assets are capitalized in the film production sector of the Group according to IAS 23. Borrowing costs attributable to non-qualifying assets are generally expensed immediately in the period incurred. 4.2 Deferred taxes Deferred taxes are recognized in the consolidated financial statements for temporary differences between the carrying amount of assets and liabilities in the IFRS balance sheet and the balance sheet drawn up for tax purposes and for tax loss carryforwards. Deferred tax assets relating to deductible temporary differences and tax loss carryforwards are recognized to the extent that it is sufficiently probable that taxable income will be available in the future to enable the tax loss carryforwards to be utilized. Deferred taxes on temporary differences in the separate financial statements are calculated at the rates which are based on the statutory regulations in force or already enacted in relation to future periods. Deferred taxes for positions recognized directly in equity are not posted to the profit and loss account, but also recognized directly in equity. Temporary differences in connection with shares in subsidiaries are not subject to deferred tax liabilities, because it is not likely that such temporary differences will reverse in the foreseeable future Equity Shares outstanding are classified as equity. As soon as the Group acquires own shares, the cash price paid including transaction costs attributable for the relevant shares is deducted from equity. If treasury stock is sold or issued, the cash price received is recognized to equity Revenue recognition In the Sports Segment, revenues are recognized when the services are provided. Broadcast advertising revenues are generally recognized on the date the commercials are aired. In the production sector, revenues are recognized upon completion and acceptance of the production by the customer. Sales revenues from the organization and feeding-in of the German Soccer Bundesliga station LIGA total! are recognized on the date the services are rendered and accepted. In the Film Segment, theatrical film revenue is recognized up to the time of theatrical release. The revenue amount is directly related to the number of theatrical audiences. In line with the industry standard, the theatrical film rental billed by the cinema operator to the distributor is recognized as the distribution component of the total theatrical revenue. Theatrical film rental is calculated on the basis of a percentage of the box office receipts. 95

100 CONSOLIDATED FINANCIAL STATEMENTS NOTES Revenue from service productions is determined using the percentage-of-completion method (PoC) in order to recognize the share of total revenues for the reporting period (see Note 4.23 Service productions). Revenue from TV rights (pay and free TV) is recognized as of the date the license takes effect, generally 18 to 32 months after the start of the theatrical exploitation. With these forms of exploitation of film rights, revenue is realized upon the expiry of the contractual exploitation holdback period. Accordingly, revenue is realized as of the date the respective license becomes available. With respect to global distribution, the Group generally receives minimum guarantees for the exploitation rights sold (theatrical, DVD/Blu-ray, TV rights). The revenues are allocated to the various types of revenue. Allocation is conducted on the basis of historical experience in accordance with corporate planning at the following general rates for theatrical, DVD/Blu-ray and TV rights: 25 percent for theatrical rights, 15 percent for DVD/Blu-ray rights and 6 percent for TV rights. The corresponding revenues are realized as follows: theatrical revenue upon theatrical release in Germany, video/dvd revenues six months after theatrical release, TV revenues 24 months after theatrical release. Revenues from global distribution sales without any minimum guarantee are recognized upon the royalty settlements received from the licensees. Regarding own DVD/Blu-ray exploitation, revenues from the number of DVDs and Blu-rays sold are recognized starting on the release date, taking into account anticipated merchandise returns. Revenues arising from the licensing of video/dvd rights to licensees are recognized as of the date the license period commences. In the Sports- and Event-Marketing Segment, sales are recognized pursuant to the contractual arrangement of the respective projects. Most of the important contracts to the projects prescribe that the Highlight Communications group is to receive a share in the net earnings of the corresponding project. These net earnings arise from the revenues of the project less costs directly attributable to the project that are billed by third parties. The project's net earnings are calculated through a project bookkeeping system. The allocable revenues are attributed to the expenses of the project. The project bookkeeping is prepared monthly for each project. In the case that previous expectations no longer cover the most recent expectations, the revenues taken into account from said project are adjusted over the remaining term of the project in accordance with the most recent expectations. Revenue from services, which is rendered over a certain period and for which the customer is periodically charged is recognized over the period in which the service is rendered. Revenues are recognized in each case in the amount invoiced without sales taxes, price discounts and quantity rebates. Dividend income is recognized in the financial year the right to receive the payment is incurred. Interest income is recognized pro rata temporis using the effective interest method Service productions In accordance with IAS 11 service productions are recognized using the percentage of completion method if the necessary criteria are fulfilled. Total contract revenues and contract costs attributable are recognized to profit or loss according to the stage of completion provided that earnings from the service production can be measured reliably. In determining the stage of completion, the physical completion method is used for dailies and weeklies and the cost-to-cost method is used for TV films and event shows. Sufficient certainty with regard to earnings from a service production when determining the stage of completion according to the cost-to-cost method is usually achieved at the time the rough cut is accepted by the station. If the earnings from the service production cannot be estimated reliably, revenue is recognized only to the extent of contract costs already incurred (zero-profit method). If the uncertainties no longer exist at a later date, thus allowing earnings from the service production to be reliably estimated, pro rata profits are realized according to the stage of completion. Where it is probable that the total contract costs will exceed the total contract revenues, the expected loss is immediately expensed. Service productions in progress are reported in the balance 96

101 sheet under assets or liabilities at the difference between revenues realized and revenues billed. Service productions in the development phase for which no assignment exists from a broadcaster are shown under inventories. This category deals with government grants relating to assets. In the balance sheet, the grant amount is deducted from the carrying amount of the film asset to the extent it will not have to be repaid with sufficient certainty Leases In the case of lease agreements in which the Group is the lessee, the leased asset and a corresponding lease payable is recognized in the same amount if economic ownership of the leased asset is attributable to the lessee (finance lease). In conformity with IAS 17 this is the case if the finance lease transfers substantially all the risks and rewards incidental to ownership. In this case, the leased asset is initially recognized at amounts equal to the fair value of the leased asset or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease. The corresponding lease payable is shown under non-current financial liabilities in the balance sheet. The interest portion of the lease payable is recognized in the financial result section of the profit and loss account over the term of the lease agreement. As of December 31, 21, as well as in the prior year, no finance leases existed in the Group. Where economic ownership of the leased asset is attributable to the lessor (Operating Lease), the leased asset is accounted for by the lessor. Lease payments under operating leases are recognized under other operating expenses in the profit and loss account over the term of the lease agreement Project promotions and subsidies Project promotion Promotion fundings are distinguished between project promotion related to contingently repayable loans and reference funds and film project promotion in conformity with the BKM guidelines (German Film Promotion Funds DFFF), which are non-repayable grants. Project promotion as a contingently repayable loan Film project promotion is granted in the form of a contingently repayable interest-free loan in accordance with the stipulations of the German film funding legislation and/or the relevant state funding regulations (e.g. rules of the Bavarian Film/Television Fund FFF Bavaria). This is repayable as soon as and to the extent that the income received by the producer as a result from the exploitation of the film exceeds a certain amount. The grant is recognized as income via a reduced amortization charge of capitalized production costs over the exploitation cycle of a film. As a rule, the amount that is not repayable with sufficient certainty can be determined at the date of the theatrical release. In the event that it is determined at a later date that another portion of the loan has to be repaid, the carrying value of the film asset is increased by this amount and a liability is reported for the corresponding obligation at the same time. Project subsidies Project subsidies are grants non-repayable, to which a producer is entitled for purposes of financing the project costs for a subsequent film depending on the number of box office admissions resulting from theatrical exploitation of a reference film. This deals with government grants relating to assets. The subsidies are deducted from the carrying value of the reference film in the balance sheet starting on the shooting date of the subsequent film. The grants are recognized as income via a reduced amortization charge of capitalized production costs over the exploitation cycle of the film. Film project promotion in accordance with the guidelines issued by the BKM (DFFF) Film project promotion according to the guidelines issued by the BKM (DFFF) are grants that do not have to be repaid and serve to refund the production costs of a theatrical film after clearly defined criteria are fulfilled. These government grants relate to assets. The granted film project promotions are deducted from the carrying value of the film asset in the balance sheet no later than the date of the theatrical release. These grants are recognized as other receivables before the date of the theatrical release. At the same time, deferred income is recognized under other liabilities. 97

102 CONSOLIDATED FINANCIAL STATEMENTS NOTES The grant is recognized as income via a reduced amortization charge of capitalized production costs over the exploitation cycle of the film. Distribution promotions Grants are distinguished between distribution promotions as contingently repayable loans and sales subsidies as non-repayable grants. Distribution promotions as a contingently repayable loan Distribution promotions are granted in the form of a contingently repayable interest-free loan in accordance with the requirements of the German film funding legislation and/or the relevant state funding regulations (e.g. rules of the Bavarian Film/Television Fund FFF Bayern). This is repayable as soon as and to the extent that the income received by the distributor as a result from the exploitation of the film exceeds a certain amount. This deals with government grants relating to expenses already incurred. The distribution promotions are recognized as a reduction of release costs by the amount that is not repayable with sufficient certainty. Grants are recognized as income over the periods necessary to match them with the corresponding release costs. As a rule, the amount that is not repayable with sufficient certainty can be determined at the date of the theatrical release. In the event that it is determined at a later date that another portion of the loan has to be repaid, such amount is expensed and a liability is recognized in the corresponding amount. Sales subsidies Sales subsidies are non-repayable grants, to which a distributor is entitled for purposes of financing the release costs for a subsequent film depending on the number of box office admissions resulting from theatrical exploitation of a reference film. This deals with government grants relating to expenses already incurred. The sales subsidies are recognized as a reduction of release costs at the time of the subsequent film's release date. 98

103 5 Notes to selected line items in the consolidated balance sheet 5.1 Film assets The following table provides a breakdown of film assets: FILM ASSETS 21 in EUR Third-party productions In-house productions Total film assets Acquisition and production costs Balance at January 1, 21 78, ,42 311,743 Changes in consolidated Group 3,779 3,779 Foreign currency differences Other additions 1,348 67,825 78,173 Disposals Reclassification Balance at December 31, 21 88,689 35, ,252 Accumulated amortization Balance at January 1, 21 46,78 119, ,99 Changes in consolidated Group Foreign currency differences Amortization for the year 13,151 63,249 76,4 Impairments 2,563 4,411 6,974 Write-ups Disposals Reclassification Balance at December 31, 21 61, , ,381 Net carrying amounts at December 31, 21 26, , ,871 The line item changes in consolidated Group contains solely additions from the acquisition of Kontraproduktion AG, Zurich. In 21, impairments in the amount of TEUR 6,974 (29: TEUR 14,257) were carried out, because the value in use for specific films did not cover acquisition costs or the net carrying value. In 21, the Constantin Medien Group received project subsidies and project promotion loans in the amount of TEUR 23,4 (29: TEUR 3,217), which were deducted from the capitalized production costs. The deferred project promotion loans amount to TEUR 1,918 as of December 31, 21 (29: TEUR 2,51). In 21, the repayments of project promotions amounted to TEUR 76 (29: TEUR 33). In addition, sales subsidies and distribution promotions in the amount of TEUR 3,484 (29: TEUR 2,597) were recognized as a deduction to the film release costs in the consolidated profit and loss account. The sales subsidies are recognized in the periods in which the corresponding film release costs are incurred. Deferred distribution loan funds amounted to TEUR (29: TEUR ) as of December 31, 21. Distribution pro- 99

104 CONSOLIDATED FINANCIAL STATEMENTS NOTES motions were repaid in the amount of TEUR 262 in 21 (29: TEUR 646). Receivables for promotions and subsidies amount to TEUR 15,364 as of December 31, 21 (29: TEUR 16,926). In the financial year 21, directly attributable financing costs of TEUR 1,28 (29: TEUR 2,282) were capitalized. To calculate costs to be capitalized, those interest rates were used that relate specifically to the financing. The interest rate varies between 2.8 to 6.5 percent (29: 1.7 to 2.4 percent). FILM ASSETS 29 in EUR Third-party productions In-house productions Total film assets Acquisition and production costs Balance at January 1, 29 68,26 174, ,752 Changes in consolidated Group Foreign currency differences Other additions 14,399 58,856 73,255 Disposals 4,264 4,264 Reclassification Balance at December 31, 29 78, ,42 311,743 Accumulated amortization Balance at January 1, 29 13,755 41,977 55,732 Changes in consolidated Group Foreign currency differences Amortization for the year 25,58 74,676 1,184 Impairments 11,79 3,178 14,257 Write-ups Disposals 4,264 4,264 Reclassification Balance at December 31, 29 46,78 119, ,99 Net carrying amounts at December 31, 29 32, , , Other intangible assets and goodwill The other intangible assets include the acquired brand name Constantin with an indefinite useful life, which was reported with a net carrying value of TEUR 28, as of December 31, 21 (29: TEUR 28,). The asset's useful life has been classified as indefinite, because the ongoing use of the brand name is intended and therefore, a useful life cannot be determined. An annual impairment test was performed on the brand name in the fourth quarter 21. The recoverable amount was calculated using the value in use. The valuation of the brand name was carried out using the license price analogy method. For this an interest rate of 7.6 percent (29: 7.7 percent) was used with a growth rate of 2.5 percent (29: 2.5 percent) over a budget period of 1 years. Using the license price analogy method, the fair value of the brand name Constantin amounted to TEUR 28, (29: TEUR 28,). The disposals of purchased intangible assets contain intangible assets from the purchase price allocation in the amount of TEUR 7,1 (29: TEUR ), which have been amortized in full and no further economic benefits are expected. 1

105 OTHER INTANGIBLE ASSETS 21 in EUR Purchased intangible assets Internally generated intangible assets Advance payments Total other intangible assets Goodwill Acquisition and production costs Balance at January 1, ,78 1,59 127, ,86 Changes in consolidated Group Foreign currency differences 12,436 12,436 12,767 Other additions Disposals 7,121 7,121 Reclassification Balance at December 31, ,956 1,59 134,15 146,853 Accumulated amortization Balance at January 1, 21 55, ,177 94,349 Changes in consolidated Group Foreign currency differences 6,288 6,288 6,638 Amortization for the year 18, ,991 Impairments 3,158 Write-ups Disposals 7,14 7,14 Reclassification Balance at December 31, 21 73, ,352 14,145 Net carrying amounts at December 31, 21 59, ,663 42,78 Total goodwill of TEUR 42,78 (29: TEUR 39,737) was recognized in the balance sheet as of December 31, 21. The increase of goodwill is exchange rate related. Impairment charges of TEUR 3,158 (29: TEUR 4,144) arising from annual impairment testing have an opposite effect. Goodwill in the amount of TEUR 33,996 is allocated to the Sports- and Event-Marketing Segment (29: TEUR 31,2). Goodwill allocated to the organization units below the Segments basically falls upon SPORT1 (21: TEUR 8,684; 29: TEUR 8,684). The impairment testing for goodwill is performed at the level of the Sports- and Event-Marketing Segment and the cashgenerating units below the Sports Segment. As part of the impairment testing of goodwill, the recoverable amount is calculated on the basis of the value in use. For purposes of the discounted cash flow method used by the Constantin Medien Group, the future cash flows are derived from a detailed threeyear forecast of earnings, except for the Sports- and Event- Marketing Segment, in which a 1-year forecast of earnings was applied analogous to the original purchase price allocation. The growth rate beyond the detailed planning period has been specified at to 1 percent (29: to 1 percent). The after-tax interest rate used for discounting is based on a capital market oriented risk evaluation according to the Capital Asset Pricing Model (CAPM). As of December 31, 21, the discounting factors before taxes stand at 9.6 to 1.2 percent (29: 1.1 to 1.4 percent). Annual impairment testing on goodwill was conducted as of December 31, 21. As a basis for the annual impairment testing, the recoverable amount of the Sports- and Event-Marketing Segment was estimated to 11

106 CONSOLIDATED FINANCIAL STATEMENTS NOTES be lower than the carrying value. This resulted in an impairment charge of TEUR 3,153. Further material impairment charges did not arise. OTHER INTANGIBLE ASSETS 29 in EUR Purchased intangible assets Internally generated intangible assets Advance payments Total other intangible assets Goodwill Acquisition and production costs Balance at January 1, , ,68 128, ,83 Changes in consolidated Group ,797 Foreign currency differences Other additions 1, ,44 5 Disposals 1, ,14 Reclassification 1,68-1,68 Balance at December 31, ,78 1,59 127, ,86 Accumulated amortization Balance at January 1, 29 19, ,193 9,183 Changes in consolidated Group Foreign currency differences Amortization for the year 19, ,1 Impairments 19, ,521 4,144 Write-ups Disposals 1, ,5 Reclassification Balance at December 31, 29 55, ,177 94,349 Net carrying amounts at December 31, 29 7, ,59 39,737 12

107 5.3 Tangible assets TANGIBLE ASSETS 21 in EUR Land, property rights and buildings Technical equipment and machinery Other equipment, plant and office equipment Advance payments and assets under construction Total tangible assets Acquisition and production costs Balance at January 1, 21 8,886 38,479 1, ,279 Changes in consolidated Group Foreign currency differences Other additions 242 4,541 2, ,37 Disposals ,225 Reclassification Balance at December 31, 21 9,227 42,165 12, ,538 Accumulated depreciation Balance at January 1, 21 5,591 28,917 6,356 4,864 Changes in consolidated Group Foreign currency differences Depreciation for the year 921 3,774 2,341 7,36 Impairments Write-ups Disposals ,166 Reclassification Balance at December 31, 21 6,527 31,878 8,146 46,551 Net carrying amounts at December 31, 21 2,7 1,287 4, ,987 13

108 CONSOLIDATED FINANCIAL STATEMENTS NOTES TANGIBLE ASSETS 29 in EUR Land, property rights and buildings Technical equipment and machinery Other equipment, plant and office equipment Advance payments and assets under construction Total tangible assets Acquisition and production costs Balance at January 1, 29 8,375 35,385 12,638 1,39 57,77 Changes in consolidated Group , ,38 Foreign currency differences Other additions 618 6,794 1, ,49 Disposals 343 3,331 3,674 Reclassification 22 2, , Balance at December 31, 29 8,886 38,479 1, ,279 Accumulated depreciation Balance at January 1, 29 4,14 27,35 7,442 38,761 Changes in consolidated Group -11-4, ,887 Foreign currency differences Depreciation for the year 975 3,561 2,368 6,94 Impairments 689 2,78 2,767 Write-ups Disposals 312 3,242 3,554 Reclassification Balance at December 31, 29 5,591 28,917 6,356 4,864 Net carrying amounts at December 31, 29 3,295 9,562 4, , Investments in associated companies and joint ventures Associated companies DETAILS ON INVESTMENTS IN ASSOCIATED COMPANIES in EUR Net carrying value Sales Earnings after taxes Total assets Total liabilities 21 Associated companies BECO Musikverlag GmbH, Hamburg Escor Casinos & Entertainment SA, Düdingen/Switzerland 5,53 2, ,318 1,189 NEF-Production S.A.S., Paris/France Associated companies BECO Musikverlag GmbH, Hamburg Escor Casinos & Entertainment SA, Düdingen/Switzerland 5,255 2,92 1,11 16,

109 With respect to BECO Musikverlag GmbH, the annual financial statements as of December 31, 29 have been applied, because financial statements as of December 31, 21 are not yet available. With respect to NEF-Production S.A.S. the amounts as of December 31, 21 were applied. With respect to Escor Casinos & Entertainment SA, the amounts reported in the annual financial statements as of December 31, 21 were applied on the basis of the ad-hoc notification of Escor Casinos & Entertainment SA dated March 3, 211. There were no contingent liabilities with associated companies as of December 31, 21. Joint Ventures The carrying value of the joint venture with Polyscreen Produktionsgesellschaft für Film und Fernsehen mbh amounted to TEUR 322 (29: TEUR 364) as of December 31, 21. The combined balance sheet and profit and loss account comprise the following: BALANCE SHEET ITEMS in EUR Assets 12/31/21 12/31/29 Non-current assets 4 5 Current assets 2,456 4,139 Liabilities Non-current liabilities Current liabilities 1,815 3,419 PROFIT AND LOSS ITEMS in EUR ' 5 percent of these amounts relate to the Constantin Medien Group. There were no contingent liabilities as of December 31, 21 and Inventories INVENTORIES in EUR ' Net balance 12/31/21 12/31/29 Work in progress 889 1,18 Blu-rays/DVDs 1,776 1,799 Fixed values Total 2,941 3,93 Work in progress mainly relates to scripts for service productions that are in the process of development, for which an assignment from the broadcaster does not yet exist. In 21, valuation allowances were recognized in the amount of TEUR (29: TEUR ) compared to releases of valuation allowances in the amount of TEUR 1 (29: TEUR 3). 5.6 Financial assets Other current financial assets Other current financial assets in the amount of TEUR 2,21 (29: TEUR 732) comprise of fixed interest bearing short term securities, which are recognized at amortized cost, and of preferred shares of a Canadian partner company, which were acquired in connection with the production of the film Resident Evil: Afterlife. It is expected that these shares will be repurchased by the partner during 211. The shares are measured at amortized cost because there is no active market for which the fair value can be determined. Total output Cost of materials Personnel expenses Depreciation 1/1 to 12/31/29 1,2-9, /1 to 12/31/29 1,125-8, Other non-current financial assets As of December 31, 21, other non-current financial assets of TEUR 247 (29: TEUR 285) mainly contain securities held as non-current assets. In 21, write-downs on noncurrent financial assets were recognized to profit or loss in the amount of TEUR 33 (29: TEUR 696). Other operating expenses Tax expense Total The securities were acquired in past financial years with the aim of profitably investing the retained earnings of one subsidiary and to call-in the securities when liquidity is needed. 15

110 CONSOLIDATED FINANCIAL STATEMENTS NOTES To this effect, the fair value is constantly monitored by the management of Olga Film GmbH in order to quickly react to any value fluctuations. The securities can be called-in when needed. Accordingly, Constantin Medien Group classifies these securities to the category at fair value through profit or loss. Non-current receivables NON-CURRENT RECEIVABLES in EUR ' 12/31/21 12/31/29 Gross balance 7,736 11,763 Discounting Specific provisions Total 7,141 1,731 Non-current receivables largely relate to the non-current purchase price receivable arising from the sale of Creation Club (CC) GmbH in 29 which is secured by a bank guarantee as well as sales taxes payable for which sales cannot yet be realized under IFRS. is due when and if the buyer does not meet its payment obligations in a timely manner. The bank guarantee is a revolving facility and terminates with the payment of the fifth installment on July 15, Trade accounts receivable Trade accounts receivable consist of receivables from third parties of TEUR 64,51 (29: TEUR 73,921). Trade accounts receivable contain receivables from percentage of completion in the amount of TEUR 6,763 (29: TEUR 8,63). In respect of receivables not yet due and receivables overdue by 9 days, the net carrying value is approximately equivalent to the fair value. Older receivables and in the case of a more specific reason, a specific allowance for doubtful accounts is recognized to write-down the net carrying value to the fair value. TRADE ACCOUNTS RECEIVABLE in EUR ' 12/31/21 12/31/29 Gross balance 71,944 81,55 Discounting -9 Specific provisions -7,434-7,575 The bank guarantee to secure the purchase price receivable incurred from the sale of Creation Club (CC) GmbH amounts to TEUR 1, (29: TEUR 1,). The guarantee sum Total 64,51 73,921 The write-downs on trade accounts receivable developed as follows in 21 and 29: WRITE-DOWNS in EUR ' Continuing operations Discontinued operations Total Balance at January 1, 21 7,575 7,575 Changes in consolidated Group Foreign currency differences 6 6 Additions 2,427 2,427 Reversals/usage -2,628-2,628 Balance at December 31, 21 7,434 7,434 Balance at January 1, 29 11,613 11,613 Changes in consolidated Group Foreign currency differences 1 1 Additions 2,27 2,27 Reversals/usage -6,122-6,122 Balance at December 31, 29 7,575 7,575 16

111 The expense for write-downs includes the addition for bad debts and income from the reversal of the allowance as well as expenses for receivables written-off. MATURITY OVERVIEW in EUR ' Days overdue Continuing operations Net carrying value Thereof: neither impaired nor overdue as of the closing date less than 9 between 91 and 18 between 181 and 27 between 271 and 365 more than /31/21 Trade accounts receivable 64,51 51,752 1, /31/29 Trade accounts receivable 73,921 57,879 11,34 2, ,91 Discontinued operations 12/31/21 Trade accounts receivable 12/31/29 Trade accounts receivable Other receivables The net carrying values of all current financial assets are equivalent to the fair values. Other taxes consist primarily of VAT receivables. Other assets comprise a short term loan of TEUR 2,167 (29: TEUR 2,628) granted to the co-producer, Davies Film Impact Pictures, in connection with the Resident Evil production. Other assets also contain a receivable due from a credit institute of TEUR 6,21 (29: TEUR ). This receivable deals with an equity-swap transaction and is subject to disposition restrictions. In the previous year, this restriction was shown under the line item cash and cash equivalents under Note 5.1. OTHER RECEIVABLES in EUR Prepaid expenses Other taxes Advance payments Suppliers with debit balances Receivables from promotion funds Receivables from settlement agreements Other assets Total 12/31/21 6,936 3, ,31 2,732 48,741 12/31/29 12,481 3, ,926 57,5 29, ,361 The next table presents an overview of the maturities for other receivables: 17

112 CONSOLIDATED FINANCIAL STATEMENTS NOTES MATURITY OVERVIEW in EUR ' Days overdue Net carrying value Thereof: neither impaired nor overdue as of the closing date less than 9 between 91 and 18 between 181 and 27 between 271 and 365 more than /31/21 Other receivables 48,741 thereof not IFRS 7 relevant 28,241 thereof IFRS 7 relevant 2,5 14, , /31/29 Other receivables 121,361 thereof not IFRS 7 relevant 33,284 thereof IFRS 7 relevant 88,77 87, Discontinued operations As of December 31, 21, the assets, liabilities and the earnings of the business operation of Life On Stage GmbH i.l. will continue to be shown as discontinued operations in conformity with IFRS The same applies to the presentation in the cash flow statement. The liquidation of Life On Stage GmbH i.l. relates only to the downstream handling process from the divestment of the Entertainment Segment. The assets and liabilities of the discontinued operations as of December 31, 21 entail current assets of TEUR 25 (29: TEUR 92) and current liabilities of TEUR 1 (29: TEUR 47). such funds are interest-bearing. The interest rate varies between and.9 percent (29: between.1 and 5 percent) Deferred tax assets In all, the Group has tax loss carryforwards for corporate income taxes in the amount of TEUR 21,22 (29: TEUR 153,785), for trade taxes in the amount of TEUR 36,383 (29: TEUR 2,331) as well as foreign tax loss carryforwards in the amount of TEUR 477 (29: TEUR 1,492) for which no deferred tax assets have been recognized. COMPOSITION OF DEFERRED TAX ASSETS in EUR ' In 21, income totaled TEUR 5 (29: TEUR 26) and expenses TEUR 26 (29: TEUR 43). The earnings from discontinued operations amount to TEUR -21 (29: TEUR -17). Tax loss carryforwards Intangible assets/film assets 12/31/21 4,411 6,7 12/31/29 7,574 5,922 Trade accounts receivable 3,941 8,3 The cash flow from discontinued operations of TEUR -53 Inventories 7,761 5,719 (29: TEUR -342) results from the operating activities of Advance payments received 8,597 8,54 TEUR -53 (29: TEUR -342). Trade accounts payable and other liabilities 5,238 2, Cash and cash equivalents Other temporary differences 4,516 3,272 This item includes cash on hand and in banks. As of December Total 4,534 41,996 31, 21, an amount of TEUR 23 (29: TEUR 3,15) is sub- Offsetting against deferred ject to disposition restrictions. tax liabilities -37,386-39,398 If daily deposits or short term demand deposits are involved, Deferred tax assets, net 3,148 2,598 18

113 Deferred taxes are calculated at the rates which are applied or are expected to be applied in the future in the individual countries at the time of realization. MATURITY OF DEFERRED TAX ASSETS in EUR ' Current deferred tax assets Non-current deferred tax assets Total 12/31/ ,445 3,148 12/31/ ,399 2,598 Conditional Capital Conditional Capital 24/III According to the resolution passed at the Annual General Meeting on March 19, 24, the Company's subscribed capital was conditionally increased by up to EUR 1,488,12 by the issuance of up to 1,488,12 bearer shares. The conditional capital increase is designed to discharge option rights for stock options, which were issued on the basis of the Annual General Meeting's resolutions of the former, EM.TV & Merchandising AG, from July 22, 1999 and July 26, 2, respectively (1999 and 2 Stock Option Programs) Stockholders' equity The development of stockholders' equity is presented in the Changes in Consolidated Equity statement. Subscribed capital The subscribed capital of the Group parent company, Constantin Medien AG, amounted to EUR 85,13,78 as of December 31, 21 (29: EUR 85,13,78) and is divided into 85,13,78 (29: 85,13,78) bearer ordinary shares with a nominal value of EUR 1. per share. Authorized Capital 29/I The extraordinary General Meeting held on January 28, 29 passed to repeal the resolutions ratified at the Annual General Meeting of July 9, 28 regarding the authorized capital 25/I (creation of new authorized capital 28/I of EUR 2,, and cancellation of the still existing authorized capital 25/I of EUR 2,,) and resolved the creation of new authorized capital 29/I of EUR 2,,. The resolutions to cancel the authorized capital 25/I and to create new authorized capital 29/I were recorded in the Commercial Register on February 9, 29. In line with the authorized capital 29/I passed by the extraordinary General Meeting on January 28, 29, the Management Board is empowered, with the approval of the Supervisory Board, to increase subscribed capital until January 27, 214 by a total of up to EUR 2,, by means of single or multiple issuances of up to 2,, new bearer shares with an equivalent amount in the subscribed capital of EUR 1. against a cash contribution or contribution-in-kind. As of December 31, 21, entitled holders had a total of 358, option rights (29: 392,5 option rights), which entitle them to purchase a total of 49,41 ordinary bearer shares (29: 53,767 bearer shares) in Constantin Medien AG with an allocable amount of EUR 1. per share of subscribed capital. Conditional Capital 25/I Based on a resolution passed at the Annual General Meeting on July 5, 25, the Company's subscribed capital was conditionally increased by up to EUR 15,, by the issuance of up to 15,, bearer shares. On the basis of this authorization, the 5.25% convertible bond 26/213 was issued on May 8, 26 via the wholly-owned subsidiary, EM.TV Finance B.V., Amsterdam. The convertible bond securitizes, inter alia, a conversion right to a total of 15,, bearer shares in Constantin Medien AG with an allocable amount of the subscribed capital equivalent to EUR 1. per share. The issuance proceeds were made available to Constantin Medien AG by EM.TV Finance B.V. by means of a long term loan. Constantin Medien AG acts as a guarantor for the convertible bond. In the event of a conversion, the repayment claim in connection with the loan lapses in the amount of the bonds converted into shares. As of December 31, 21, the conditional capital 25/I amounts to EUR 14,968,183 (29: EUR 14,968,183). During the 21 financial year 24 convertible bonds were converted into 24 Constantin Medien AG shares. Treasury shares were used to fulfill conversion. In the previous year no conversion occurred. 19

114 CONSOLIDATED FINANCIAL STATEMENTS NOTES Conditional Capital 28/I Based on a resolution passed at the Annual General Meeting on July 9, 28, the Company's subscribed capital was conditionally increased by up to EUR 2,, by the issuance of up to 2,, bearer shares. The conditional capital increase shall be executed only to the extent that the bearer or creditor can use their right of conversion or subscription rights or can satisfy its conversion obligation for convertible bonds and/or bonds with warrants issued through the Company or a direct or indirect subsidiary until July 8, 213, provided that treasury shares are not used for tender. The Management Board is empowered to specify the other details for executing the conditional capital increase. The resolution concerning the conditional capital 28/I was recorded with the Commercial Register on August 5, 29. Treasury stock As of December 31, 21, the balance of directly and indirectly non-voting treasury shares amounts to 7,424,378 Constantin Medien shares with a carrying value of EUR 12,992,662 taking into account the Constantin Medien shares held by Highlight Communications AG (29: 7,424,42 shares; carrying value of EUR 14,848,84). The Company does not have any rights whatsoever in connection with the treasury stock. On the basis of a resolution of the General Meeting on June 9, 21, the Company is empowered to acquire treasury shares of up to 1 percent of the Company's subscribed capital existing as of the date of the resolution. The empowerment became effective at the end of the General Meeting held on June 9, 21 and is valid until June 9, 215. The empowerment is limited for the acquisition of treasury shares with a computed share of subscribed capital totaling up to EUR 8,513,78. The authorization can be exercised in whole or in part, once or several times. For purposes of statutory requirements, the treasury shares, either together with other treasury shares in the possession of the Company or attributable under 71a ff. AktG (Stock Companies Act) are not permitted to be more than 1 percent of subscribed capital at any time. Stock Option Programs As of December 31, 21, a total of 358, (29: 392,5) stock option rights were outstanding, which were entitled for the purchase of a total of 49,41 bearer shares (29: 53,767 bearer shares) of Constantin Medien AG with an allocable amount of subscribed capital equivalent to EUR 1. per share. The option rights or shares outstanding as of December 31, 21 relate exclusively to the 2 Stock Option Program. On the basis of the expiry of exercise, the 1999 Stock Option Program was closed in the previous year. The decline over the prior year is due to the resignation of employees whose stock option rights are therewith forfeited. All stock option programs reached the end of the vesting period in the financial year 27. Therefore, no personnel expenses were recognized for the accounting of stock options in the financial years 21 and 29, respectively. No option rights were exercised in the financial years 21 and 29, respectively. OPTIONS NOT ACCOUNTED FOR IN ACCORDANCE WITH IFRS 2 Exercise price after merger in EUR Number of outstanding options Convertible in the future Date of issue March 1, , 231, January 31, , 87, December 2, , 2, 11

115 OPTIONS ACCOUNTED FOR IN ACCORDANCE WITH IFRS 2 Exercise price after merger in EUR Number of outstanding options Convertible in the future Date of issue December 2, 22 7,96 2, 2, OUTSTANDING OPTIONS Number of options Weighted average exercise price in EUR 21 Outstanding at January 1 392, Issued Exercised Expired Forfeited 34, Outstanding at December , Outstanding at January 1 1,1, 12.3 Issued Exercised Expired 32, Forfeited 45, Outstanding at December , Capital reserve The Group's capital reserve totals TEUR 111,256 as of December 31, 21 (29: TEUR 128,989). The reduction of capital reserve primarily results from the acquisition of non-controlling interests in Team Holding AG in the second quarter of the financial year, which was directly recognized in equity. Due to this transaction capital reserve decreased by TEUR 17,678 and the non-controlling interests decreased by TEUR 21,715. Other reserves Other reserves amount to TEUR 14,147 as of the balance sheet date (29: TEUR 9,45) and comprise reserves for the employee option program of TEUR 175 (29: TEUR 175), reserves for exchange rate translation of non-euro group companies of TEUR 8,893 (29: TEUR 3,791) and miscellaneous reserves of TEUR 5,79 (29: TEUR 5,79). The changes in the other components of equity comprise of the following for the financial years 21 and 29, respectively: 111

116 CONSOLIDATED FINANCIAL STATEMENTS NOTES OTHER COMPREHENSIVE INCOME AND LOSS in EUR Before taxes Tax effect After taxes January 1 to December 31, 21 Unrealized foreign currency translation gains/losses 5, ,563 Reclassification of realized gains/losses Total foreign currency translation differences 5, ,563 Changes in at-equity investments not affecting net income Other comprehensive income/loss 5, ,563 January 1 to December 31, 29 Unrealized foreign currency translation gains/losses Reclassification of realized gains/losses Total foreign currency translation differences Changes in at-equity investments not affecting net income Other comprehensive income/loss Disclosures regarding capital management Constantin Medien AG aims to increase the capital provided on the capital market to the Company and to generate attractive annual returns for the shareholders. For this purpose, the parent company of the Group employs capital by acquiring investments and funding their operations as well as own operations. Moreover, the Constantin Medien Group can decide on a dividend payout, to pay capital back to shareholders, to issue new shares or to dispose of assets with the aim of reducing debt. Management aims to efficiently employ own and external capital for purposes of assuring financial flexibility on the basis of a solid capital structure and providing sufficient liquidity. Liquidity comprises of inflows from operating activities, cash funds on hand and available external funds. In addition to own capital, external debt is also employed for Group financing in order to raise capital profitability. To assure this objective, a profitability calculation is generally prepared for every major investment. These procedures are regularly based on cash flow methods (DCF), whereby the weighted average cost of capital (WACC) is applied in most models. Hence, the further raising of capital employment is methodically supported. For purposes of controlling and classifying profitability generated in the Group, capital ratios are calculated several times a year; this includes the capital return ratio and the total return on capital. These ratios are benchmarked with those of other companies. The Constantin Medien Group's liquidity is monitored centrally via Constantin Medien AG for the Sports Segment and Others. The Highlight Communications Group controls its liquidity on its own and independent of Constantin Medien AG. To assure liquidity funds, Constantin Medien AG employs a liquidity report and a liquidity plan and for purposes of assessing the liquidity status the key indicators indebtedness and net debt defined as current and non-current financial liabilities less cash and cash equivalents. Constantin Medien AG's capital management comprises of all equity balance sheet items whereby treasury stock is deducted. 112

117 In line with Group monitoring, Constantin Medien AG monitors all external debt positions of the Sports Segment and Others. The external debt of the companies within the Highlight Communications Group is locally monitored via Highlight Communications AG and Constantin Film AG. The external debt managed by Constantin Medien AG is largely secured through the shares in the Highlight Communications Group, the receivables from the sale of Creation Club (CC) GmbH and the pledging of shares in PLAZAMEDIA GmbH TVund Film-Produktion upon the first written demand by the bank as well as through the guarantees of Constantin Medien AG. The funds mostly comprise of a convertible bond, a corporate bond, a loan with a private investor and an operations credit line facility. For external debt financial relations and other conditions must be met as well as information must be made available. Maintaining certain financial covenants was agreed to in the credit agreements of Highlight Communications AG and Constantin Film AG. The financial covenants relate to EBIT, EBIT margin, interest coverage ratio, indebtedness, economic equity ratio and the ratio of net financial debt to operating results. A breach of the external debt conditions can cause an increase in the interest and a cancellation option can exist. No financial covenants were breached in the financial year 21. The credit lines (production financing and license trading lines) are secured by film rights shown under film assets in the amount of TEUR 136,869 (29: TEUR 138,298) and by the resulting exploitation revenues and receivables totaling TEUR 36,272 (29: TEUR 41,255). The drawn amounts are due when requested in

118 CONSOLIDATED FINANCIAL STATEMENTS NOTES 5.13 Overview of provisions and liabilities MATURITY OF PROVISIONS AND LIABILITIES in EUR ' Less than 1 year 1 to 5 years More than 5 years Total 21 Non-current liabilities Provisions 3,259 3,259 Pension liabilities 5,636 5,636 Financial liabilities 43,3 43,3 Other liabilities 1, ,735 Deferred tax liabilities 3,814 18,96 22,774 Total 3,814 81, ,74 Current liabilities Financial liabilities 259,6 259,6 Advance payments received 46,14 46,14 Trade accounts payable 54,18 54,18 Liabilities due to associated companies and joint ventures 2,392 2,392 Other liabilities 72,993 72,993 Provisions 22,227 22,227 Income tax liabilities 6,332 6,332 Total 463, , Non-current liabilities Provisions Pension liabilities 3,778 3,778 Financial liabilities 86,263 86,263 Other liabilities Deferred tax liabilities 1,93 21,411 22,54 Total 1,93 111, ,978 Current liabilities Financial liabilities 214, ,466 Advance payments received 35,487 35,487 Trade accounts payable 53,621 53,621 Liabilities due to associated companies and joint ventures 2,576 2,576 Other liabilities 8,781 8,781 Provisions 28, 28, Income tax liabilities 7,147 7,147 Total 422,78 422,78 114

119 5.14 Trade accounts payable and other liabilities Trade accounts payable and other liabilities in the amount of TEUR 127,11 (29: TEUR 134,42) comprise of trade accounts payable of TEUR 54,18 (29: TEUR 53,621) and other liabilities of TEUR (29: TEUR 8,781). Trade accounts payable Trade accounts payable are not further securitized apart from customary retention of title and largely relate to license payments or services. Trade accounts payable contain TEUR 47 payables from percentage of completion (29: TEUR ). Other current liabilities The personnel-related liabilities mainly relate to obligations for bonus, overtime and vacation not taken and bonuses for Board members. Other current liabilities include TEUR 135 (29: TEUR 645) for related parties (see Note 11). Overall trade accounts payable are current and non-interest bearing so that the carrying value is equivalent to the fair value. Other current liabilities consist of the following: OTHER CURRENT LIABILITIES in EUR ' 12/31/21 12/31/29 Liabilities for contingently repayable loans (grants) Personnel-related liabilities Current interest payable Sales tax payable Other taxes and social security Deferred income Customers with credit balances Commissions and licenses Current other loans Designated derivative financial instruments in accordance with IAS 39 Derivative financial instruments not designated Liabilities from settlement agreements Other current liabilities Total 12,562 18,349 2,16 4,696 1,838 8, , ,577 6,366 72,993 13,851 15,82 1,996 2,44 1,673 17, , ,559 9,167 6,447 8,781 Other non-current liabilities Other non-current liabilities of TEUR 1,735 (29: TEUR 12) mainly relate to a discounted, contingent purchase price payment in connection with the acquisition of shares in Team Holding AG of TEUR 9,512 and liabilities in connection with purchased license rights in the amount of TEUR 71 (29: TEUR 17) Financial liabilities Non-current financial liabilities Non-current financial liabilities amounted to TEUR 43,3 as of the balance sheet date (29: TEUR 86,263) and comprise a corporate bond in the amount of TEUR 28,3 issued in the fourth quarter of the financial year and a long term portion of a loan granted by a related party of Highlight Communications AG of TEUR 15, (29: TEUR 3,). The convertible bond 26/213 reported last year under non-current financial liabilities has been reclassified to current financial liabilities. 115

120 CONSOLIDATED FINANCIAL STATEMENTS NOTES In 29, Constantin Medien AG obtained a non-current loan in the amount of TEUR 3, from a related party of Highlight Communications AG with a term of three years. A tranche of TEUR 15, is due for repayment in August 211. The second tranch of TEUR 15, is due for repayment in September 212. As collateral on the loan, a security account was pledged with 22.3 million Highlight Communications shares. On October 13, 21, Constantin Medien AG issued a corporate bond with a volume of EUR 3 million. The bond, which was issued as a private placement, has a term of five years and accrues interest at 9. percent p.a. Pursuant to 13 of the bond covenants, Constantin Medien AG can cancel the bond starting October 13, 213 by giving notice of at least 3 and a maximum of 6 days. Current financial liabilities As of the balance sheet date, current financial liabilities comprise of amounts due to banks of TEUR 21,629 (29: TEUR 214,466), of TEUR 15, (29: TEUR ) from a loan of a private investor as well as of an amount of TEUR 42,971 from the convertible bond 26/213 (29: TEUR 56,63). The convertible bond was shown in the preceding year under non-current financial liabilities in the amount of TEUR 56, % Convertible bond 26/213 According to a resolution passed by the Annual General Meeting on July 5, 25, EM.TV Finance B.V., Amsterdam (a wholly-owned subsidiary of Constantin Medien AG), issued a 5.25% convertible bond 26/213 with a total nominal value of TEUR 87,75 on May 8, 26. Each convertible bond allows conversion in of Constantin Medien AG bearer shares with an allocable amount of the subscribed capital equivalent to EUR 1. per share. The issuance price, which is equivalent to the face amount, and the initial conversion price amount to EUR 5.85 for each convertible bond. The interest rate is 5.25 percent p.a. guarantee to the bond creditors for the interest payments and for the ultimate repayment. In the case of conversion, the repayment claim in connection with the loan expires in the amount of the bonds converted into shares of Constantin Medien AG. For accounting purposes, the convertible bond was divided into an equity portion and a third-party debt portion. The debt portion compounds interest over the term of the bond up to the repayment amount (effective interest rate of 8.4 percent). The convertible bond matures on May 7, 213, whereby both the issuer and creditor may, under certain circumstances and at specific dates, demand repayment at an earlier date. In the third quarter 28, the convertible bond was revalued with respect to the probable repayment date, because Constantin Medien AG's stock price was considerably below the conversion price of EUR 5.85 per share. Therefore, it was more than likely that the bond creditors will demand their claim as pre-scribed in the bond stipulations for repayment of the bond in May 211. In 21, 24 convertible rights were exercised on convertible bonds of EM.TV Finance B.V. that were issued for bearer shares of Constantin Medien AG, with the result that 14,965,459 (29: 14,965,483) convertible bonds were still outstanding as of the balance sheet date. In 21, the Constantin Medien Group bought back a total of 2,545,57 (29: 3,9,) convertible bonds, resulting in 7,545,57 bonds owned by the Group and still 7,42,42 (29: 9,965,483) bonds outstanding with third parties. As a result of the repurchase of the convertible bonds, proceeds were realized in the amount of TEUR 7 (29: TEUR: 9,69) which were reported under financial income. Based on the closing rate of EUR 5.89 (29: EUR 5.1) for each convertible bond, the fair value amounts to TEUR 43,76 as of December 31, 21 (29: TEUR 49,927). 5.25% CONVERTIBLE BOND 26/213 in EUR ' 12/31/21 12/31/29 The issuance proceeds from the convertible bond were used by EM.TV Finance B.V. to make a long term loan available to Constantin Medien AG. The loan receivable serves as guarantee for the bond creditors. Constantin Medien AG issued a Equity component Liability component Total 8,671 42,971 51,642 8,671 56,63 64,

121 The following collaterals were granted to the creditors of the convertible bond: EM.TV Finance B.V. assigned all claims in connection with the loan to Constantin Medien AG in the amount of TEUR 87,548 to the bond creditors. Upon assignment, a portion of the loan is allotted for each convertible bond. With respect to each convertible bond, assignment occurs with the repayment of the convertible bond without the exercise of conversion rights. Constantin Medien AG guaranteed to the creditors the proper and timely payment of all amounts due Pension liabilities The amounts of the pension liabiities and corresponding expenses have been determined by an independent actuary. The calculation of the pension liabilities is based on the projected-unit-credit method. Actuarial gains and losses are recognized according to the corridor method. The liabilities correspond to the difference between the present value of the defined benefit obligation (DBO) and similar post-employment benefits, the fair value of plan assets and unrealized actuarial gains and losses. As of the balance sheet date the Group has the following unused, short term credit lines available: Constantin Medien AG has available short term bank credit lines in the total amount of TEUR 1, as of December 31, 21 (29: TEUR 1,), of which TEUR 5, (29: TEUR 5,) is for guarantees exclusively in the favor of SPORT1 GmbH and PLAZAMEDIA GmbH TV- und Film-Produktion; thereof, a total of TEUR 4,399 was utilized as of the balance sheet date (29: TEUR 4,48). As collateral, Constantin Medien AG granted a pledging of the shares in PLAZAMEDIA GmbH TV- und Film-Produktion upon the first written demand by the bank. In addition, the receivable and bank guarantee of the direct 1 percent subsidiary PLAZAMEDIA GmbH TV- und Film-Produktion arising from the sale of the shares in Creation Club (CC) GmbH were assigned. The pension liabilities developed as follows in 21: PENSION LIABILITIES in EUR ' 12/31/21 12/31/29 Present value of defined benefit obligation Fair value of plan assets Funded status Unrecognized actuarial losses/(gains) Recognized liability 32,329-23,321 9,8-3,372 5,636 22,686-16,951 5,735-1,957 3,778 The Highlight Communications group has available unused short term credit lines of about TEUR 98,434 as of the balance sheet date (29: TEUR 93,22). Thereof, the credit lines of the Constantin Film group (production financing and license trading lines) are secured by film rights shown under film assets of TEUR 136,869 (29: TEUR 138,298) and by the resulting exploitation revenues as well as by receivables in the amount of TEUR 36,272 (29: TEUR 41,255). The credit line of Highlight Communications AG in the amount of TEUR 76,596 (29: TEUR 65,873) is secured by shares in Constantin Film AG, by shares in Escor Casinos & Entertainment SA as well as Constantin Medien shares held by Highlight Communications AG. 117

122 CONSOLIDATED FINANCIAL STATEMENTS NOTES The defined benefit obligation developed as follows: DEVELOPMENT OF DEFINED BENEFIT OBLIGATION in EUR ' Present value of defined benefit obligation at January 1 Changes in consolidated Group Current service cost Past service cost Interest cost Curtailment, settlement Benefits paid Currency translation effects Actuarial losses/(gains) 22,686 2, ,32 18, , ,58 Present value of defined benefit obligation at December 31 32,329 22,686 Plan assets developed as follows: DEVELOPMENT OF PLAN ASSETS in EUR ' Fair value of plan assets at January 1 Changes in consolidated Group Expected return on plan assets Employee contributions Employer contributions Benefits paid Currency translation effects Actuarial (losses)/gains 16, , , , , Fair value of plan assets at December 31 23,321 16,951 Plan assets are allocated to the individual investment categories as follows: ALLOCATION OF PLAN ASSETS in % Liquid funds Debt instruments Equity instruments Real estate Others Total

123 The redemption value of the foundations is reported in the corresponding category of the plan assets. Actual return on plan assets amounted to TEUR 736 in the reporting year (29: TEUR 426). The expected return on plan assets amounts to TEUR 816 in 211. TOTAL PENSION COSTS in EUR ' 1/1 to 12/31/21 1/1 to 12/31/29 Current service cost Interest cost Expected return on plan assets Realized actuarial losses/(gains) Past service cost Effects from curtailments and settlements Employee contributions 2, , Total 2,58 1,515 The current and past service cost and the actuarial gains and losses are shown in the profit and loss account under personnel expenses or income. The interest cost and the expected return on plan assets are also shown under personnel expenses. The expected employer contribution payments amount to TEUR 1,644 for the financial year 211. The defined benefit plans are actuarially measured on the basis of the following parameters: PENSION PARAMETERS in % 21 Foreign plans 29 Foreign plans Discount rate Expected return on plan assets Pension trend Salary trend Projected average life after retirement, men (in years) Projected average life after retirement, women (in years) With respect to pension plans of subsidiaries in Switzerland, actuarial assumptions are based on the BVG 25 tables. 119

124 CONSOLIDATED FINANCIAL STATEMENTS NOTES Experience-based adjustments are presented as follows: EXPERIENCE-BASED ADJUSTMENTS AT DECEMBER 31 in EUR ' Present value of defined benefit obligation 32,329 22,686 18, Fair value of plan assets 23,321 16,951 14,36 Funded status 9,8 5,735 4, Experience-based adjustments for plan liabilities 1,145 1, Experience-based adjustments for plan assets ,693 Total 1,44 6,867 6, The contributions recognized to profit or loss for defined contribution plans (including government plans) totaled TEUR 8,539 in 21 following TEUR 7,25 the year before Provisions PROVISIONS in EUR ' Licenses and returns Litigation costs Personnel provisions Provisions for warranties and other obligations Other provisions Total Balance at January 1, 21 6,693 4,56 2,75 9,548 5,311 28,313 Changes in consolidated Group Foreign currency differences Usage 3, ,465 2, ,51 Reversal 5,148 2, , ,655 Reclassification Addition 7, ,954 1,93 14,284 Balance at December 31, 21 5,479 2,395 1,262 8,75 7,6 25,486 thereof non-current ,444 3,259 The provision for licenses and returns has been recognized for unbilled licenses attributable to licensors and risks from any merchandise returns for Blu-rays and DVDs sold. The provision for return of goods is based on an analysis of the contractual or statutory obligations as well as historical trends and the Group's own experience. The provision for litigation costs has been recognized to take account of various pending or anticipated litigation proceedings. The personnel provisions contain expenses arising from the termination of employment contracts in the amount of TEUR 1,874 (29: TEUR 3,87). 12

125 5.18 Income tax liabilities INCOME TAX LIABILITIES in EUR ' Total domestic taxes thereof trade tax thereof corporate income tax Foreign income taxes Total Balance at January 1, 21 3, ,75 3,714 7,147 Changes in consolidated Group Foreign currency differences Usage 4,96 2,489 2,471 4,433 9,393 Reversal Reclassification 1,54 1, ,54 Addition 3,415 1,645 1,77 5,59 8,474 Balance at December 31, 21 3,98 1,674 1,424 3,234 6, Deferred tax liabilities DEFERRED TAX LIABILITIES in EUR ' 12/31/21 12/31/29 Intangible assets/film assets 43,738 49,519 Trade accounts receivable 1,725 2,93 Convertible bonds/corporate bond 4,12 4,216 Provisions Advance payments received 7,415 3,4 Other temporary differences 2,486 1,33 Total 6,16 61,92 Offsetting against deferred tax assets -37,386-39,398 Deferred tax liabilities, net 22,774 22,54 MATURITY OF DEFERRED TAX LIABILITIES in EUR ' 12/31/21 12/31/29 Current deferred tax liabiities Non-current deferred tax liabilities 3,814 18,96 1,93 21,411 Total 22,774 22,54 121

126 CONSOLIDATED FINANCIAL STATEMENTS NOTES 5.2 Non-current construction contracts Construction contracts with a debit balance owed to customers amount to TEUR 6,763 (29: TEUR 8,63). Construction contracts with a credit balance owed to customers amount to TEUR 47 (29: TEUR ). Such amounts are reported to the respective trade accounts receivable or trade accounts payable positions. According to IAS 11.39, the contract revenues of the period amount to TEUR 72,624 (29: TEUR 8,46). The sum of costs incurred for uncompleted contracts pursuant to IAS 11.4 and recognized profits (less any losses) amount to TEUR 28,265 (29: TEUR 23,768) Advance payments received The advance payments received of TEUR 46,14 (29: TEUR 35,487) include cash receipts from world sales for which revenue has not yet been recognized as well as other advance payments received of TEUR 46,14 (29: TEUR 35,461). 6 Notes to selected line items in the consolidated profit and loss account 6.1 Sales The classification of sales is presented in the segment reporting section 8 of these Notes. 6.2 Capitalized film production costs and other own work capitalized Capitalized film productions amount to TEUR 7,16 (29: TEUR 75,912). The other own work capitalized in the amount of TEUR 8 (29: TEUR 932) comprises of internally-generated intangible assets. Furthermore, the change in inventories of work in progress amount to TEUR (29: TEUR 56). 6.3 Other operating income Income from damage claims and settlement agreements mainly comprise of income from compensation for copyright infringements. In the prior year the item additionally contained income arising from the settlement of the civil liability lawsuits in the gross amount of TEUR 57,5 less TEUR 9,167 for expenditures in connection with contractual obligations to third parties. The income from the reversal of provisions is primarily the consequence of the lapse of obligations for licenses as well as the reversal of provisions for pending litigation. OTHER OPERATING INCOME in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Income from the reversal of provisions and accruals Income relating to other periods Recharges Foreign currency exchange gains Income from rents and leases Income from disposal of liabilities Income from disposal of fixed assets Income from deconsolidation Income from damage claims and settlement agreements Miscellaneous other operating income 7,954 1, , ,23 4,235 3,574 1,42 1, ,194 51,891 4,881 Total 25,151 66,96 122

127 Income from rents and leases arise from the sub-leasing of office premises. of TEUR 155,24 (29: TEUR 17,259) and costs for purchased services of TEUR 33,78 (29: TEUR 25,849). Miscellaneous other operating income consists of a large number of items that cannot be allocated to the items shown separately; namely, for insurance compensation payments, marketing compensation payments, severance benefits, suppliers' reimbursements and other refunds, inter alia. 6.5 Amortization, depreciation and impairment Scheduled amortization and depreciation of TEUR 12,427 (29: 127,89) include TEUR 2,661 (29: TEUR 23,372) for the amortization on assets arising from the purchase price allocation. 6.4 Cost of materials and licenses Costs for licenses, commissions and materials amounting to TEUR 61,553 (29: TEUR 75,96) are attributable to payments for licenses and commissions totaling TEUR 25,52 (29: TEUR 26,871) and for other cost of materials in the amount of TEUR 25,398 (29: TEUR 47,546). In addition, this includes costs for royalty payments in the amount of TEUR 1,635 (29: TEUR 1,543) arising from the Film Segment. The costs for purchased services in the amount of TEUR 188,912 (29: TEUR 196,18) comprise production costs The impairment of film assets amounting to TEUR 6,974 (29: TEUR 14,257) relates to films in which their carrying values are no longer covered by the values in use. This includes impairments in the amount of TEUR 748 for adjustments recognized from the purchase price allocation (29: TEUR 8,278). The impairment charges on other intangible assets arising from the purchase price allocation amount to TEUR (29: TEUR 18,). During the financial year 21 goodwill impairment charges of TEUR 3,158 (29: TEUR 4,144) were recognized (see Note 5.2). 6.6 Other operating expenses OTHER OPERATING EXPENSES in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Rental, repair and maintenance costs Advertising and travelling costs Legal, consulting and auditing costs Expenses for additions to bad debt allowance and receivable write-offs IT costs Administration costs Other personnel-related costs Insurance, dues and fees Expenses relating to other periods Foreign currency exchange losses Vehicle costs Bank fees Earnings attributable to business partners Miscellaneous other operating expenses 12,549 11,23 12,488 2,953 3,485 5,423 1, ,511 14,773 6,97 11,22 2,456 3,355 7,821 4,486 1,29 6, ,594 13,77 Total 63,858 75,

128 CONSOLIDATED FINANCIAL STATEMENTS NOTES The rental, repair and maintenance costs are attributable to costs for the present office building as well as for costs incurred for the sub-leased former office building of Constantin Medien AG. The legal, consulting and auditing costs include inter alia auditing costs of the consolidated financial statements and individual financial statements, tax consultancy fees and costs for legal consultation in, among other things, on-going proceedings and copyright infringements. Miscellaneous other operating expenses consist of a large number of items that cannot be allocated to the items shown separately. 6.7 Earnings from investments in associated companies and joint ventures The prior year s earnings from the investment in Escor Casinos & Entertainment SA contained besides the share in net earnings a write-up of TEUR 791. EARNINGS FROM INVESTMENTS IN ASSOCIATED COMPANIES AND JOINT VENTURES in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Escor Casinos & Entertainment SA PolyScreen Produktionsgesellschaft für Film und Fernsehen mbh BECO Musikverlag GmbH NEF-Production S.A.S , Total , Financial income Financial income of TEUR 7,944 (29: TEUR 11,7) comprises of TEUR 1,319 (29: TEUR 1,525) for other interest and similar income, TEUR 1,86 (29: TEUR 9,318) for gains in fair value changes of financial instruments and TEUR 4,765 (29: TEUR 164) for foreign exchange gains. The profit from fair value changes of financial instruments includes gains from an equity swap transaction amounting to TEUR 554 (29: loss of TEUR 83). This equity swap transaction deals with the sale of 9, treasury shares by Highlight Communications AG to a credit institution (contractual partner) at a price of EUR 6.9 per share. The contract term ran from August 11, 28 to December 23, 21 and was extended on November 17, 21 with a new credit institution (contractual partner) for one year maturing on December 23, 211. The contract unmodified stipulates that gains arising from the sale of the shares by the contractual partner would flow in full to Highlight Communications AG. Losses must also be carried by Highlight Communications AG. The difference of the share price as of December 31, 21 to the original sales price leads to the recognition of a financial liability in the amount of TEUR 2,439 in the consolidated balance sheet as of December 31, 21 (29: TEUR 2,559). The sale of shares by the contractual partner shall be conducted during the contractually set sales period (September 1, 211 to December 21, 211), subject to an early settlement payment. The profit from fair value changes comprised gains from the repurchase of convertible bonds in the amount of TEUR 7 (29: TEUR 9,69). In addition, this position comprises of income from a CHF/EUR forward contract in the amount of TEUR (29: TEUR 58). 124

129 6.9 Financial expenses FINANCIAL EXPENSES in EUR 1/1 to 12/31/21 1/1 to 12/31/29 Loss arising from changes in the fair value of financial instruments Interest expenses on the 5.25% convertible bond 26/213 and on the corporate bond Other interest and similar expenses Foreign currency exchange losses 49 3,817 5,181 1,511 1,536 4,24 8, Total 1,558 14, Taxes CLASSIFICATION OF TAXES in EUR ' 1/1 to 12/31/21 1/1 to 12/31/29 Current taxes Deferred taxes Income taxes for continuing operations Income taxes for discontinued operations -6, ,831-9,935 14,256 4,321 Total income taxes -5,831 4,321 TAX RECONCILIATION in EUR ' 1/1 to 12/31/21 1/1 to 12/31/29 Result from continuing and discontinued operations Expected taxes based on a tax rate of 27.38% (29: 27.38%) Differing tax rates Reversal/write-down on deferred tax assets Tax-exempt income Permanent differences Change in tax rates Non-deductable expenses Tax income and expenses relating to other accounting periods Other effects Unrecognized deferred taxes Impairment of goodwill Actual income tax Effective tax rate in percent 3, , , , , , , , ,135 4,

130 CONSOLIDATED FINANCIAL STATEMENTS NOTES Taxes comprise of income taxes paid or payable in the respective countries and deferred taxes. The income taxes include trade tax, corporate income tax, unification solidarity surcharge and the corresponding foreign income taxes Earnings per share EARNINGS PER SHARE Net profit attributable to shareholders in EUR Average number of issued ordinary shares Average number of potential shares from options Certificates Convertible bonds 1/1 to 12/31/21-11,378 77,449,494 1/1 to 12/31/29 8,79 75,77,137 7 Disclosures regarding financial risk management The next table depicts the net carrying values and fair values for financial instruments to the respective classes as well as a classification into the different categories of financial instruments according to IAS 39. The non-current financial assets class measured at fair value through profit or loss contains only securities that were designated as at fair value through profit or loss in the past financial years. Financial liabilities as of December 31, 21 comprise TEUR 259,6 (29: TEUR 214,466) current and TEUR 43,3 (29: TEUR 86,263) non-current financial liabilities. Total average number of issued and potential shares 77,449,494 75,77,137 Earnings per share attributable to shareholders, basic in EUR Earnings per share attributable to shareholders, diluted in EUR Potential shares do not include potential shares from options to employees or the 5.25% convertible bond 26/213, because either the exercise price is above the underlying average stock price or it has no diluting effects. 126

131 DISCLOSURES UNDER IFRS 7: CLASSES FOR 21 in EUR ' Classification category under IAS 39 Net carrying value 12/31/21 Of which not relevant under IFRS 7 Amortized cost Fair value through profit or loss Fair value 12/31/21 Assets Cash and cash equivalents LaR 28,932 28,932 28,932 Trade accounts receivable LaR 64,51 64,51 64,51 Receivables due from associated companies and joint ventures (current and non-current) LaR 9,253 9,253 9,253 Other financial assets (current) Financial assets at amortized cost LaR Available-for-sale financial assets AfS 1,217 1,217 1,217 Other receivables (current) LaR 48,73-28,241 2,489 2,489 Non-current receivables LaR 7,141 7,141 7,562 Other financial assets (non-current) Financial assets at fair value through profit or loss FVPL Available-for-sale financial assets AfS Designated derivative financial instruments in without accordance with IAS 39 category Liabilities Financial liabilities (current and non-current) OL 32,9 32,9 33,124 Financial liabilities (current and non-current), without hedged items in accordance with IAS 39 category Trade accounts payable OL 54,18 54,18 54,18 Payables due from associated companies and joint ventures (current and non-current) OL 2,392 2,392 2,392 Other liabilities (current and non-current) Financial liabilities at amortized cost OL 81,14-18,978 62,162 62,162 Financial liabilities at fair value through profit or loss FLPL 2,577 2,577 2,577 Other liabilities without (hedged items in accordance with IAS 39) category Aggregated by category Loans and receivables LaR 339,37-28, , ,55 Available-for-sale financial assets AfS 1,252 1,252 1,252 Financial assets at fair value through profit or loss FVPL Financial liabilities at amortized cost OL 44,45-18, , ,696 Financial liabilities at fair value through profit or loss FLPL 2,577 2,577 2,

132 CONSOLIDATED FINANCIAL STATEMENTS NOTES DISCLOSURES UNDER IFRS 7: CLASSES FOR 29 in EUR ' Classification category under IAS 39 Net carrying value 12/31/29 Of which not relevant under IFRS 7 Amortized cost Fair value through profit or loss Fair value 12/31/29 Assets Cash and cash equivalents LaR 148, , ,511 Trade accounts receivable LaR 73,921 73,921 73,921 Receivables due from associated companies and joint ventures (current and non-current) LaR Other financial assets (current) Financial assets at amortized cost LaR Financial assets at fair value through profit or loss FVPL Other receivables (current) LaR 12,238-33,284 86,954 86,954 Non-current receivables LaR 1,731-1,386 9,345 9,61 Other financial assets (non-current) Financial assets at fair value through profit or loss FVPL Available-for-sale financial assets AfS without Other assets (hedged items in accordance with IAS 39) category 1,123 1,123 1,123 Liabilities Financial liabilities (current and non-current) OL 3,13 297,454 2, ,687 Financial liabilities (current and non-current), without hedged items in accordance with IAS 39 category Trade accounts payable OL 53,621 53,621 53,621 Payables due from associated companies and joint ventures (current and non-current) OL 2,576 2,576 2,576 Other liabilities (current and non-current) Financial liabilities at amortized cost OL 8,399-7,56 72,893 72,893 Financial liabilities at fair value through profit or loss FLPL Designated derivative financial instruments without in accordance with IAS 39 category Aggregated by category Loans and receivables LaR 354,73-34,67 319,43 319,659 Available-for-sale financial assets AfS Financial assets at fair value through profit or loss FVPL Financial liabilities at amortized cost OL 436,69-7,56 426,544 2, ,777 Financial liabilities at fair value through profit or loss FLPL

133 The net results of the respective categories of financial instruments are shown in the following table: In the prvious year others contain primarily income from the repurchase of convertible bonds. NET RESULTS FOR THE CATEGORIES UNDER IFRS 7 in EUR ' From interests From subsequent measurement From disposal Others Net result Change in fair value Foreign currency translation Impairment 21 Loans and receivables (LaR) 1, , ,13 Available-for-sale financial assets (AfS) Financial assets at fair value through profit or loss (FVPL) Designated 9 9 For trading Financial liabilities (OL) -8,83 2,396 4, ,1 Financial liabilities at fair value through profit or loss (FLPL) Loans and receivables (LaR) 1, , Available-for-sale financial assets (AfS) Financial assets at fair value through profit or loss (FVPL) thereof for trading Financial liabilities at (OL) -1, ,42 9,69 94 Financial liabilities at fair value through profit or loss (FLPL) Management of financial risks The Group is exposed to various financial risks arising from operating business activities and financing activities. Financial risks are sub-classified by liquidity risks, credit risks and market risks (including currency risk, interest risk and price fluctuation risk). These risks are centrally examined within the Constantin Medien Group. The risk situation is identified by the risk manager in a standardized risk report prepared on the basis of the risk management guideline in effect for the entire Group and reported to the Management Board of Constantin Medien AG. Moreover, the risk presentation is outlined in the Risk Report, which forms a part of the Management Report (Chapter 8). Liquidity risks A liquidity risk arises if future payment obligations of the Group cannot be covered by liquidity on hand or corresponding credit facilities. To limit this risk, appropriate processes are in place within the Constantin Medien Group that continuously monitor and control cash inflow, outflow and maturities. Constantin Medien AG and the Constantin Medien Group had sufficient liquidity reserves taking into account available short term credit facilities as of the balance sheet date. 129

134 CONSOLIDATED FINANCIAL STATEMENTS NOTES The table below depicts the maturity structure of non-derivative financial liabilities and presents an analysis of cash outflows for derivative financial liabilities and assets. LIQUIDITY RISK in EUR ' Cash flow 211 Cash flow 212 December 31, 21 Net carrying value Interest fixed Interest variable Repayment Interest fixed Interest variable Repayment Non-derivative financial liabilities Financial liabilities 32,9 6, ,38 3,141 15, Other non-interest-bearing liabilities 118,572 17,837 11,131 Derivative financial liabilities and assets Derivative financial liabilities Derivatives without a hedge relationship 138 1, Currency derivatives under fair value hedges Other derivatives 2,439 6,21 Derivative financial assets Currency derivatives under fair value hedges 11 1,249 Cash flow Cash flow December 31, 21 Net carrying value Interest fixed Interest variable Repayment Interest fixed Interest variable Repayment Non-derivative financial liabilities Financial liabilities 32,9 7,83 29, Other non-interest-bearing liabilities 118, Derivative financial liabilities and assets Derivative financial liabilities Derivatives without a hedge relationship 138 Currency derivatives under fair value hedges Other derivatives 2,439 Derivative financial assets Currency derivatives under fair value hedges 11 13

135 LIQUIDITY RISK in EUR ' Cash flow 21 Cash flow 211 December 31, 29 Net carrying value Interest fixed Interest variable Repayment Interest fixed Interest variable Repayment Non-derivative financial liabilities Financial liabilities 3,729 4, ,466 4,169 73,498 Other non-interest-bearing liabilities 129,9 128, Derivative financial liabilities and assets Derivative financial liabilities Derivatives without a hedge relationship Currency derivatives under fair value hedges 47 3,91 Other derivatives Derivative financial assets Currency derivatives without a hedge relationship 6 4, December 31, 29 Net carrying value Cash flow Cash flow Interest fixed Interest variable Repayment Interest fixed Interest variable Repayment Non-derivative financial liabilities Financial liabilities 3, , Other non-interest-bearing liabilities 129,9 81 Derivative financial liabilities and assets Derivative financial liabilities Derivatives without a hedge relationship Currency derivatives under fair value hedges 47 1,221 Other derivatives Derivative financial assets Currency derivatives without a hedge relationship 6 131

136 CONSOLIDATED FINANCIAL STATEMENTS NOTES In general, the Group companies are responsible for the disposition of liquid funds on their own, including current deposits of liquidity surpluses and procurement of loans to bridge liquidity shortages. Constantin Medien AG in part supports its subsidiaries and in part acts as a coordinator with banks for purposes of maintaining the most cost-effective coverage of financial requirements. In addition, the Group's creditworthiness enables efficient use of capital markets for financing activities. This also includes the ability of issuance of equity and debt instruments on the capital market. Accordingly, diverse projects, particularly in the film business and other financing activities such as purchase of non-controlling interests and acquisition of treasury stock can affect the liquidity over time to a varying extent. In the fourth quarter of 21, the Company issued a corporate bond with a volume of EUR 3 million for additional refinancing and to assure financial flexibility. Presently, Constantin Medien AG disposes of sufficient liquidity even taking into account the scenario of a potential early repayment of the convertible bond 26/213 in May 211. It is noted that despite the available operating credit line and cash inflow from the issuance of a corporate bond, it might be neccessary to borrow third-party capital via the capital market or credit institutes both to refinance existing liabilities and to finance new projects. Therefore, the risk still persists that a worsening of the economic situation could lead to financing funds not being available or not being available to the extent needed or only being available at distinctly unfavorable conditions. Credit risks A credit risk exists when the debtor is unable to meet a repayment obligation for a receivable at all or on time or for the loss in value of assets received as collateral and therefore causing a financial loss. The credit risk includes the direct counterparty risk and the risk of credit deterioration. Financial institutions with which the Constantin Medien Group conducts business must have good credit ratings. Moreover, possible risks on liquid funds are minimized by allocating bank deposits among several financial institutions. Furthermore, potential default risks on customer receivables are regularly evaluated and, if required, valuation allowances for bad debt are recognized. Identified default risk is taken into account by means of write-down. In addition, the Company insures the risk of default caused by insolvency of a debtor by means of obtaining credit checks. Therefore, the Group assesses the credit quality of receivables that are neither overdue nor impaired to be largely satisfactory. The risks from the international distribution of film licenses are minimized in such a way that transactions are only conducted with counterparties having reliable credit ratings, that rights only are transferred to the counterparty upon payment or that transactions are made with corresponding collaterals (e.g. letter of credit). The maximum credit risk of the Constantin Medien Group is equivalent to the carrying value of the financial assets. Fair value The table below presents an allocation of financial assets and liabilities measured at fair value according to the three-level fair value hierarchy. FAIR VALUE HIERARCHY IN 21 in EUR Level 1 Level 2 Level 3 Total Financial assets measured at fair value Derivative financial instruments Financial assets at fair value through profit or loss Available-for-sale financial assets Financial liabilities measured at fair value Derivative financial instruments 2,577 2,

137 FAIR VALUE HIERARCHY IN 29 in EUR Level 1 Level 2 Level 3 Total Financial assets measured at fair value Derivative financial instruments Financial assets at fair value through profit or loss Available-for-sale financial assets Financial liabilities measured at fair value Derivative financial instruments 3,61 3,61 Financial assets and liabilities that are measured at fair value are allocated to the following levels of the fair value hierarchy: Quoted prices on an active market (not adjusted) for similar assets or liabilities (Level 1) Directly (as a price) or indirectly (derived from the price) observable market inputs for assets or liabilities other than quoted prices according to Level 1 (Level 2) Inputs not based on observable market data (non-observable input data) (Level 3) The financial assets measured at fair value through profit or loss which are included in Level 1 are determined by means of stock prices. The derivative financial instruments included in Level 2 are measured at the current market prices. To determine the fair value of financial instruments in Level 2, a discounted cash flow method has been applied. Reclassifications between the individual categories of the fair value hierarchy have not been conducted. Market risks Market risks are understood to be risks from exchange rate and interest rate fluctuations and other risks from changes in a price base. Currency risk The Constantin Medien Group is exposed to currency risks as part of its ordinary business activities. This primarily relates to the US dollar and due to the subsidiaries with the functional currency denominted in the Swiss Franc compared to the Euro. Exchange rate fluctuations can give rise to undesired and unforeseeable profit and cash flow volatility. Every subsidiary is subject to risks associated with exchange rate fluctuation when it transacts with international contractual partners incurring future cash flows thereof that do not correspond to the functional currency of the respective subsidiary. The Constantin Medien Group does not transact business activities in currencies with above-average volatility or otherwise notably risky. Regarding material transactions, mainly in US dollar, the Group aims to minimize the currency risk through the use of appropriate derivative and non-derivative financial instruments. Derivative financial instruments are entered into with credit institutions. The financial instruments largely relate to future foreign currency cash flows for film projects. The Group considers that the amount of the hedging does not exeed the underlying transaction. In the current financial year, the Constantin Film group has entered a series of forward exchange contracts for hedging purposes. As far as possible these hedging relationships are accounted for as fair value hedges in conformity with IAS 39. The hedged items relate to pending purchases of rights in US dollar. As of December 31, 21, the nominal amount of all forward contracts designated as hedging instrument in fair value hedges amount to TEUR 1,249 (29: TEUR 5,534). The fair value of these forwards totals TEUR 11 (29: TEUR -47) and arises from the difference between the forward rate on the date the transaction is concluded and the market value of the forward contract on the balance sheet date. The market value changes of the forward contracts and the forecast trans- 133

138 CONSOLIDATED FINANCIAL STATEMENTS NOTES actions are recognized in opposite amounts in the profit and loss account. The loss recognized in the operating result in 21 for carrying value adjustments made to the hedged item amounted to TEUR 84 (29: gain of TEUR 387). Gains arising from the change in the fair values of hedging instruments of TEUR 84 (29: loss of TEUR 387) were recognized in the operating result. To hedge against currency risks foreign exchange payables were also used as hedging instruments in the prior year. These hedges served to hedge against presently off-balance sheet fixed claims in US dollar. The hedging relationships were presented as fair value hedges. During the reporting period the hedging relationship has been completed. The fair value of the foreign exchange payables amounted to TEUR -716 in the prior year. In the prior year income was incurred in the amount of TEUR 716 from the change in the fair value of the hedged item. Expenses of TEUR 716 were incurred in the prior year from the change in the fair value of the hedging instrument; both were recognized in the operating result. On completion of the hedge relationship in the reporting period, gains of TEUR 1,251 were recognized as a basis adjustment to film assets. The notional amounts and the fair values of derivative instruments as of December 31, 21 and 29, which are not designated in hedge relationships are as follows: DERIVATIVE FINANCIAL INSTRUMENTS in EUR 12/31/21 12/31/29 Notional value Fair Value Notional value Fair Value Forward exchange transactions Sale PLN 248 HRK 94-2 CAD 4, EUR 4, 6 Forward exchange transactions Buy USD 3, ,25-95 CAD 1,721-4 Interest risk Interest risk generally arises when market interest rates change, which can improve or worsen the proceeds from deposits or payments for money procured. Furthermore, an interest fluctuation risk arises from the mismatching of maturities, which is actively monitored by the Group, especially through observations of the development of the yield curve. The interest fluctuation risk for the Group relates predominantly to current and non-current financial liabilities. At the present time, the Constantin Medien Group has available variable interest-bearing current financial liabilities and fixed interest-bearing non-current financial liabilities. The Group is currently using an interest cap agreement to hedge against the risk of rising money market rates of interest. With the issuance of the corporate bond in the financial year 21 there is also the possibility of cancelling the bond after a period of three years and to repay it in full. In times of rising interest rates, fixed interest agreements offer a corresponding safeguarding against additional costs. However, in times of falling interest rates they have the disadvantage that, the Company cannot profit from that development. In case of financial liabilities without flexible arrangements 134

139 for withdrawal and repayment, fixed interest conditions provide adequate planning assurance. In contrast, in credit agreements with high flexibility variable interest rate agreements allow for future fluctuations in credit withdrawing (further explanations to financial liabilities are presented under Note 5.15). Furthermore, there is the possibility to establish a fixed interest base through interest hedges. Other price risk Other price risks are defined as the risk that the fair value or future payments of a financial instrument can fluctuate due to changes in the fair market value, which has not already been incurred from interest risk or currency risk. Other price risks arise for financial assets measured at fair value through profit or loss and for financial assets available for sale. Hedging of such financial assets is not performed. Other price risks as of December 31, 21 relate to an equity swap transaction with Highlight Communications AG shares and designated securities under the fair value option. Assuming a fluctuation of +/- 1 percent in the market value of the securities, the impact on earnings would be TEUR +/- 265 (29: TEUR +/- 387). Other price risks in connection with the change in the market value of assets held for sale of 1 percent that would lead to a decrease or increase in equity (other reserves) did not arise as of December 31, 21 (29: TEUR ). Sensitivity analysis In conformity with IFRS 7 a sensitivity analysis is required to be prepared which depicts the impact of possible changes in market rates of interest on the earnings or equity. Changes in the market rates of interest for variable interest-bearing financial instruments affect interest income and interest expense. The interest sensitivity analysis has been prepared on the assumption of a change in the market rates of interest by plus 1 base points or minus 1 base points. An increase would result in additional income before taxes of TEUR 142 (29: additional expense of TEUR 548). A decrease of an equivalent nature would result in a decrease of earnings before taxes by TEUR 135 (29: increase by TEUR 618). The calculation of the currency sensitivity was conducted from the Group's perspective for the material currency pairs EUR/USD, CHF/EUR and EUR/CAD under the assumption that the exchange rate underlying the currency pair would change by 1 percent upwards or downwards and all other parameters remained unchanged. Translation risks are not part of the sensitivity analysis. The table below presents the impact of changes in the exchange rates by 1 percent on the earnings before taxes. 135

140 CONSOLIDATED FINANCIAL STATEMENTS NOTES SENSITIVITY ANALYSIS in EUR ' Currency risk Interest rate risk EUR/USD CHF/EUR EUR/CAD Total Other price risks 21-1% +1% -1% +1% -1% +1% -1% +1% -1% +1% -1% +1% Financial assets Cash and cash equivalents -2,89 2,89 2,43-1, ,648-1,35 Trade accounts receivable Other financial assets Other receivables ,371-1, , ,752-1,435 Non-current receivables Financial liabilities Trade accounts payable Other liabilities -1, ,573-1, Financial liabilities 2,16-2, ,222-2, ,556-2,92 Forward exchange transactions Total increase/decrease ,95-1,597 3,37-2,488 1, ,561-5, Financial assets Cash and cash equivalents -1,485 1, ,488-1,218 1,394-1,141 Trade accounts receivable 1, ,53 2,48 1,478-1, Other financial assets Other receivables Non-current receivables Financial liabilities Trade accounts payable ,641-2, ,588-2,118 Other liabilities , Financial liabilities 2,137-2,137-1, ,638-3,795-2,145 1,755 1,324-1, Forward exchange transactions Total increase/decrease ,387-1,135 4,484-3, ,672-5,

141 8 Segment reporting The segment information presented below is based on the socalled "Management Approach". of in-house productions and acquired film rights as well as the distribution of theatrical, DVD-/Blu-ray and television films. The Company s Management Board, as the chief operating decision maker, makes decisions about the allocation of resources to the segments and still assesses their success on the basis of key indicators for sales and segment result. The Management Board does not assess the segments on the basis of assets and liabilities. Based on the internal management reporting system and the underlying organizational structure of internal reporting, the Group is still classified into the three operative segments Sports, Film as well as Sports- and Event-Marketing. Additionally, Others contain the administrative functions of the holding company, Constantin Medien AG, and the activities of EM.TV Finance B.V. The Sports Segment primarily comprises the TV and online activities under the brand SPORT1, in the IPTV area the operation of LIGA total! and in the production field the activities of the PLAZAMEDIA Group. The marketing is conducted by Constantin Sport Marketing GmbH. The Sports- and Event-Marketing Segment consists of the activities of Team Holding AG, a 1 percent shareholding of Highlight Communications AG, which markets as its main project the UEFA Champions League via its subsidiaries. Additional marketing projects are the UEFA Europe League, the Eurovision Song Contest and the Vienna Philharmonic Symphony. Additionally, Others contain the administrative functions of the holding company, Constantin Medien AG, and the activities of EM.TV Finance B.V. The Segment result is defined as earnings before earnings from investments in associated companies and joint ventures, before the financial result, before taxes and before earnings from discontinued operations. Sales and services transacted between business segments are generally rendered at prices that would have been agreed with third parties. The Film Segment contains the activities of Constantin Film AG and its subsidiaries as well as the Highlight Communications subsidiaries Rainbow Home Entertainment. The business activities encompass the production of films, the exploitation In total, the Constantin Medien Group generated with one customer more than 1 percent of total sales (29: two customers). These sales relate to the Sports- and Event-Marketing Segment. SALES WITH CUSTOMERS in EUR in percent in EUR in percent 1/1 to 12/31/21 1/1 to 12/31/29 Sales with customer A (Segment Film) 67, Sales with customer B (Segment Sports- und Event-Marketing) 71, , Sales with other customers 398, , Total sales 47, ,

142 CONSOLIDATED FINANCIAL STATEMENTS NOTES SEGMENT INFORMATION 21 in EUR ' Sports Film Sports- and Event- Marketing Others Reconciliation Group External sales 156, ,25 72,944 47,292 Intercompany sales Total sales 156, ,25 72, ,292 Other segment income 1,23 84, ,641-4,248 95,391 Segment expenses -166,818-32,77-65,978-1,378 4, ,53 thereof scheduled amortization and depreciation -5,816-77,88-18, ,427 thereof impairments -6-6,974-3, ,17 Segment result from continuing operations ,12 7,22-5,737 6,18 Non-allocated items Earnings from investments in associated companies and joint ventures -177 Financial income 7,944 Financial expenses -1,558 Profit from continuing operations before taxes 3,389 SEGMENT INFORMATION BY GEOGRAPHICAL REGION 21 in EUR ' Germany Rest of Europe Rest of the world Total External sales 254, ,6 43,169 47,292 Non-current assets 199,944 71, ,

143 SEGMENT INFORMATION 29 in EUR ' Sports Film Sports- and Event- Marketing Others Reconciliation Group External sales 168, ,64 61, ,66 Intercompany sales Total sales 168, ,17 61, ,66 Other segment income 6,633 84, ,118-4,66 143,86 Segment expenses -19,8-386,861-59,757-21,298 4, ,447 thereof scheduled amortization and depreciation -6,24-13,849-17, ,89 thereof impairments -4,288-32,257-4,144-4,689 Segment result from continuing operations -14,84-2,83 2,248 34,82 1,425 Non-allocated items Earnings from investments in associated companies and joint ventures 1,398 Financial income 11,7 Financial expenses -14,122 Loss from continuing operations before taxes -292 SEGMENT INFORMATION BY GEOGRAPHICAL REGION 29 in EUR ' Germany Rest of Europe Rest of the world Total External sales 297, ,98 27, ,66 Non-current assets 24,728 75,528 28,

144 CONSOLIDATED FINANCIAL STATEMENTS NOTES 9 Accounting estimates and assumptions The preparation of the consolidated financial statements in conformity with IFRS requires management to use estimates and assumptions that affect the classification and measurement of reported income, expenses, assets, liabilities and contingent liabilities as of the balance sheet date. These estimates and assumptions represent management's best estimate based on historical experience and other factors, including estimates about future events. The estimates and assumptions are continually reviewed. Changes in accounting estimates are necessary if changes occur in the circumstances on which the estimate was based or as a result of new information or additional findings. Such changes are recognized in the period of the change. The most important assumptions concerning future development as well as key sources of uncertainties surrounding estimates which could give rise to significant revaluation in assets and liabilities, income, expenses and contingent liabilities in the next twelve months are presented below. Impairment of non-financial assets Goodwill and other intangible assets with indefinite lives are tested at least once a year for impairment and if triggering events indicate possible impairment. Film assets and other non-financial assets are tested for impairment if triggering events indicate that the carrying value exceeds the recoverable amount. To assess whether impairment exists, estimates of expected future cash flows per cash-generating unit from the use and eventual disposal of such assets are performed. The actual cash flows could significantly vary from the estimated discounted future cash flows. Changes in sales and cash flow forecasts could lead to impairment charges. Financial assets The fair value of financial assets traded on organized markets is determined on the basis of the quoted market price as of the balance sheet date. The fair value of financial assets without an active market is determined by applying valuation methods. Valuation methods include the application of most recent business transactions between knowledgeable, willing parties in an arm's length transaction, comparison with the fair value of another, mostly identical financial instrument, analysis of discounted cash flows and use of other valuation models based on Management's assumptions. The Group determines whether there is any indication of impairment of financial assets or group of assets at each balance sheet date and if triggering events indicate possible impairment. Service productions In determining the stage of completion of productions according to the percentage of completion method, the cost-to-cost method (realization of earnings in the amount of production costs incurred as of the closing date in proportion to the expected total production costs) or the method of physical completion are applied. The determination of expected total production costs or physical completion are subject to the use of estimates. Changes in accounting estimates have a direct impact on the earnings generated Provisions for anticipated merchandise returns The Group's provision for anticipated merchandise returns is based on an analysis of constructive or legal obligations and historical performance as well as the Group's experience. According to information available at the present time, Management deems the provision to be adequate. Since these deductions are based on Management's estimations, revisions may arise as soon as new information becomes available. Such revisions could impact the provisions and sales in future reporting periods. Provisions for litigation Group companies face various legal disputes. As of today's date, the Group assumes that litigation provisions cover such risks. However, additional lawsuits could be filed whose costs would not be covered by the existing provisions. Moreover, it cannot be ruled out that the extent of legal disputes could increase and that future lawsuits, disputes, proceedings and investigations will be insignificant. The incurrence of such events could impact provisions recognized for litigation in future reporting periods. Deferred taxes Extensive estimates are required to determine deferred tax assets and liabilities. Several of these estimates are based on interpretations of enacted tax laws and legislation. Management is of the opinion that the estimates are adequate and uncertainties surrounding income taxes for recognized assets and liabilities have been sufficiently taken into account. In particular, 14

145 deferred tax assets from loss carryforwards are dependent on the generation of future corresponding profits. Also, deferred tax assets from valuation adjustments are dependent on future profit performance. Furthermore, the carryforward of net tax losses expire in certain countries over time. Actual profits could vary from forecasted profits. Such changes could impact deferred tax assets and liabilities in future reporting periods. 1 Financial commitments, contingent liabilities and other financial commitments 1.1 Overview An overview of the financial commitments, contingent liabilities and other financial commitments is presented below as follows: FINANCIAL COMMITMENTS, CONTINGENT LIABILITIES AND OTHER FINANCIAL COMMITMENTS in EUR ' Financial commitments Contingent liabilities Acceptance obligations for licenses Other financial commitments Rental and lease obligations Total Balance at December 31, 21 Due within one year 9, 38,749 26,646 9,174 83,569 Due between one and five years 3,3 16,766 25,875 1,196 56,137 Due after five years 5,557 5,557 Total 9, 3,3 55,515 58,78 19,37 145,263 Balance at December 31, 29 Due within one year 9, 31,337 25,841 9,178 75,356 Due between one and five years 3,3 32,66 25,934 17,419 79,313 Due after five years Total 9, 3,3 63,997 51,775 26, , Financial commitments Guarantees totaling TEUR 9, have been issued to various TV stations for service productions as of December 31, 21 (29: TEUR 9,). 1.3 Contingent liabilities Contingent liabilities amount to TEUR 3,3 as of December 31, 21 (29: TEUR 3,3) and relate only to litigation costs. The probabilities of contingent liabilities to occur are considerably below 5 percent. rights of SPORT1 GmbH. In addition, in signing license agreements, the Group assures access to future film rights. Financial obligations arise in the future from the purchase of film rights or from productions underway, which amount to TEUR 2,678 (29: TEUR 11,492). 1.5 Other financial commitments Other financial commitments contain commitments from the development of in-house productions in the amount of TEUR 7,331 (29: TEUR 4,584). 1.4 Acceptance obligations for licenses The acceptance obligations for licenses include TEUR 34,837 (29: TEUR 52,55) for broadcasting and transmission 1.6 Rental and lease obligations The Constantin Medien Group rents and leases office space, storage space, vehicles and equipment. Total rental and lease 141

146 CONSOLIDATED FINANCIAL STATEMENTS NOTES expenses amounted to TEUR 8,675 and TEUR 1,53 for the financial years 21 and 29, respectively. The following minimum lease payments exist as of December 31, 21: OBLIGATIONS UNDER OPERATING LEASES in EUR ' Rent for buildings and office space Vehicle leases Others 12/31/21 12/31/29 Due within one year 8, ,174 9,178 Due between one and five years 9, ,196 17,419 Due after five years Total 18, ,37 26, Relationships with related companies and persons The Company maintains relations as part of normal business activities with associated companies and joint ventures as well as companies that are controlled by Supervisory Board Members. No business relations were carried out between Constantin Medien AG and associated companies and joint ventures in the financial year 21. The realized sales and other income in 21 totaling TEUR 971 (29: TEUR 1,88) of the Highlight Communications group from PolyScreen Produktionsgesellschaft für Film und Fernsehen mbh largely relate to the service production of "Dahoam is Dahoam". As of December 31, 21, there were receivables of TEUR (29: TEUR ), advance payments received of TEUR (29: TEUR ) and trade accounts payable in the amount of TEUR 2,392 (29 TEUR: 2,576). Furthermore, receivables due from NEF-Production S.A.S. in the amount of TEUR 9,253 existed as of December 31, 21. The outstanding receivables from the co-production The three Musketeers were posted as a reduction to the production costs. Sales and expenses have not been incurred. A consultancy agreement exists between the Constantin Film group and Fred Kogel GmbH covering license trading, TV/service productions and film distribution. Expenses amounted to TEUR 31 in the financial year 21 (29: TEUR 31). The liabilities stand at TEUR 25 as of December 31, 21 (29: TEUR ). Related persons comprise of the Management and Supervisory Boards and their relatives. Constantin Medien AG and Highlight Communications AG each signed consultancy agreements with Werner E. Klatten. The agreement with Constantin Medien AG runs for a fixed period from September 1, 28 until December 31, 211. The contract between Highlight Communications AG and Mr Werner E. Klatten expired on December 31, 21. Expenses incurred from the agreements amount to TEUR 613 in the financial year 21 (29: TEUR 612). Liabilities total TEUR 6 as of December 31, 21 (29: TEUR 29). All transactions with related companies and persons are carried out on an arm's-length basis. Further explanations regarding remuneration to Management Board and Supervisory Board members are presented under Note

147 12 Subsequent events after the balance sheet date As part of an agreement with UFA Sports GmbH, SPORT1 acquired extensive rights until 213 to the Men's and Women's IHF Handball World Championships for broadcasting on SPORT1, SPORT1+ and the sports portal SPORT1.de. For the Men's Handball World Championships in 211 and 213, SPORT1 secured the exclusive live rights to all non-germany matches as well as extensive non-exclusive after-exploitation rights. For the Women's Handball World Championships in 211 and 213, SPORT1 secured the exclusive live and afterexploitation rights to all matches. In addition, SPORT1 acquired live and exclusive rights from Infront Sports & Media for the Women's EHF Handball European Championships in 212 and 214 for broadcasting on all SPORT1 distribution platforms. Quite surprisingly and unexpected, the producer Bernd Eichinger died of a heart attack on January 24, 211 in Los Angeles. With him, Constantin Film AG has lost a friend and fellow companion, who shaped Constantin Film AG and the film industry both nationally and internationally for over 3 years German Corporate Governance Code The Management and Supervisory Boards of Constantin Medien AG have agreed to apply the German Corporate Governance Code applicable for listed companies. Only a few exceptions were noted to the recommendations for compliance. The declaration of compliance pursuant to 161 AktG is published on the Company's homepage under Number of employees The average number of employees within the Group developed as follows: NUMBER OF EMPLOYEES Salaried employees 1,5 1,17 Freelancer Total 1,486 1,54 The average number of employees in the joint venture Poly- Screen Produktionsgesellschaft für Film und Fernsehen mbh amounted to 1 (29: 1). On January 14, 211, Highlight Communications AG announced the continuation of the successful marketing co-operation between its subsidiary TEAM and the European Broadcasting Union (EBU) until 215 and, subject to achieving performance targets, for an additional three year term thereafter Executive bodies of the Company Management Board Bernhard Burgener, Zeiningen/Switzerland (Chief Executive Officer) Antonio Arrigoni, Feldkirchen (Chief Financial Officer) 13 Other information and disclosures 13.1 Audit fees The line item other operating expenses includes expenses due to PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprüfungsgesellschaft as the Group auditor in the amount of TEUR 591 (29: TEUR 621) for audit-related services, TEUR 43 (29: TEUR 67) for tax consulting fees and TEUR 74 (29: TEUR 69) for other services. Expenses are estimated to be incurred in the additional amount of TEUR 3. Bernhard Burgener is member of the following control bodies, Supervisory Boards and Board of Directors: Chief Executive Officer of Constantin Film AG, Munich Advisor of Constantin Entertainment GmbH, Ismaning Chief Executive Officer of Highlight Communications AG, Pratteln/Switzerland President of the Board of Directors of Team Holding AG, Lucerne/Switzerland President of the Board of Directors of Team Football Marketing AG, Lucerne/Switzerland President of the Board of Directors of T.E.A.M Television Event And Media Marketing AG, Lucerne/Switzerland 143

148 CONSOLIDATED FINANCIAL STATEMENTS NOTES President of the Board of Directors of KJP Holding AG, Lucerne/Switzerland President of the Board of Directors of Rainbow Home Entertainment AG, Pratteln/Switzerland President of the Board of Directors of Constantin Film Schweiz AG, Basel/Switzerland Board of Directors of Escor Casinos & Entertainment SA, Düdingen/Switzerland Board of Directors of Escor Automaten AG, Düdingen/Switzerland President of the Board of Directors of Lechner Marmor S.p.A., Laas/Italy President of the Board of Directors of Lasamarmor S.p.A., Laas/Italy Board of Directors of CBE Marmor & Handels AG, Ibach/ Switzerland Antonio Arrigoni is member of the following Supervisory Boards and Board of Directors: Board of Directors of Highlight Communications AG, Pratteln/ Switzerland The remuneration for the Members of the Management Board comprised of fixed and variable components. As part of the contract renewals for Mr Bernhard Burgener and Mr Antonio Arrigoni in 21 for a term extending until August 31, 213 and June 3, 214, respectively, the variable remuneration component was renegotiated for the Management Board Members. In addition to annual performance-based compensation, the variable compensation comprises a component with long term incentives, which is oriented among others on the development of the share price and the earnings of the Group. The variable compensation components are contractually limited. The long term component is first paid out after the approval of the consolidated financial statements of December 31, 212, upon achieving the contractually-fixed targets. The contracts of the Management Board Members also contain a so-called severance payment cap in the event that the contract is prematurely terminated without due cause. Total remuneration of Management Board Members for the financial year 21 amounts to TEUR 2,787 (29: TEUR 3,342). REMUNERATION OF MANAGEMENT BOARD in EUR Fixed remuneration Variable remuneration Other payments Total Bernhard Burgener 45, 15, 1,411,653 2,11,653 Antonio Arrigoni 617,81 15, 7, ,33 Furthermore, in 21 bonus provisions with long term incentives were recorded for Mr Bernhard Burgener and Mr Antonio Arrigoni in the amount of TEUR 5, respectively. The other payments to Bernhard Burgener relate to his activities performed in his function as Chief Executive Officer of Constantin Film AG as well as President of the Board of Directors and Supervisory Boards of various companies in the Highlight Communications group. The other payments to Antonio Arrigoni relate his activities performed in the Board of Directors of Highlight Communications AG. Share claims arising from option rights do not exist for the members of the Management Board and the Supervisory Board. The number of shares of the executive bodies and persons related to them as of December 31, 21 are presented in the following table (number of shares): 144

149 SHARES AND OPTIONS RIGHTS OF BOARD MEMBERS Management Board Bernhard Burgener Antonio Arrigoni Supervisory Board Fred Kogel Werner E. Klatten Dr Erwin Conradi Dr Dieter Hahn Jan P. Weidner Dr Bernd Kuhn Number of shares 5,5, 6,279 33, 5,735,95 2,543, 8,47 Share entitlements associated with option rights Supervisory Board Fred Kogel, Producer, Straßlach-Dingharting (Chairman) Werner E. Klatten, Attorney, Hamburg (Deputy Chairman) Dr Erwin Conradi, Entrepreneur, Risch/Switzerland (until June 9, 21 and since August 6, 21) Dr Dieter Hahn, Managing Director, Munich Jan P. Weidner, Investment Banker, Frankfurt/Main Dr Bernd Kuhn, Attorney, Munich (since August 6, 21) Martin Wagner, Attorney, Rünenberg/Switzerland (until June 9, 21) Total remuneration of Supervisory Board Members for the reporting year amounts to TEUR 1,74 (29: TEUR 2,62) and is broken down as follows: REMUNERATION OF SUPERVISORY BOARD in EUR Fixed remuneration Variable remuneration Other payments Total Fred Kogel 73,94 337, 41,94 Werner E. Klatten 41, ,44 692,88 Dr. Erwin Conradi (until June 9 and since August 6, 21) 2,931 31,515 52,446 Dr. Dieter Hahn 3, 3, Martin Wagner (until June 9, 21) 13, , ,892 Jan P. Weidner 28,82 28,82 Dr. Bernd Kuhn (since August 6, 21) 11,836 11,836 According to the bylaws, the variable component for remuneration of the Members of the Supervisory Board is calculated from the earnings per share of the Constantin Medien Group. The minimum results prescribed in the bylaws, for which variable remuneration would be paid, was not reached in 21. The other payments to Mr Fred Kogel relate to his activities performed for the Supervisory Board of Constantin Film AG and for fees associated with the consultancy agreement with the Constantin Film group and Fred Kogel GmbH. In addition to his compensation as President of the Board of Directors of Highlight Communications AG, the other payments to Mr Werner E. Klatten also include compensation from consultancy agreements signed with Constantin Medien AG and Highlight Communications AG. The other payments to Martin Wagner relate to his activities performed as member of Supervisory Boards and Board of Directors of various companies in the Highlight Communications group. Ismaning, March 21, 211 Constantin Medien AG Bernhard Burgener Chief Executive Officer Antonio Arrigoni Chief Financial Officer 145

150 CONSOLIDATED FINANCIAL STATEMENTS RESPONSIBILITY STATEMENT RESPONSIBILITY STATEMENT Responsibility Statement To the best of our knowledge, and in accordance with the applicable reporting principles for financial reporting, the consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the Constantin Medien Group, and the Group Management Report includes a fair review of the development and performance of the business and the position of the Constantin Medien Group, together with a description of the principal opportunities and risks associated with the expected development of the Constantin Medien Group. Ismaning, March 21, 211 Constantin Medien AG Bernhard Burgener Chief Executive Officer Antonio Arrigoni Chief Financial Officer 146

151 AUDITOR S REPORT CONSOLIDATED FINANCIAL STATEMENTS AUDITOR S REPORT Auditor s Report We have audited the consolidated financial statements prepared by the Constantin Medien AG, Ismaning, comprising the statement of financial position, the income statement, the statement of comprehensive income, statement of changes in equity, cash flow statement and the notes to the consolidated financial statements, together with the group management report, which is combined with the management report of the Constantin Medien AG; Ismaning, for the business year from January 1 to December 31, 21. The preparation of the consolidated financial statements and the combined management report in accordance with the IFRSs, as adopted by the EU, and the additional requirements of German commercial law pursuant to (Article) 315a Abs. (paragraph) 1 HGB ("Handelsgesetzbuch": German Commercial Code) are the responsibility of the parent Company's Board of Managing Directors.Our responsibility is to express an opinion on the consolidated financial statements and the combined management report based on our audit. In addition we have been instructed to express an opinion as to whether the consolidated financial statements comply with full IFRS. We conducted our audit of the consolidated financial statements in accordance with 317 HGB and German generally accepted standards for the audit of financial statements promulgated by the Institut der Wirtschaftsprüfer (Institute of Public Auditors in Germany) (IDW). Those standards require that we plan and perform the audit such that misstatements materially affecting the presentation of the net assets, financial position and results of operations in the consolidated financial statements in accordance with the applicable financial reporting framework and in the combined management report are detected with reasonable assurance. Knowledge of the business activities and the economic and legal environment of the Group and expectations as to possible misstatements are taken into account in the determination of audit procedures. The effectiveness of the accounting-related internal control system and the evidence supporting the disclosures in the consolidated financial statements and in the combined management report are examined primarily on a test basis within the framework of the audit. The audit includes assessing the annual financial statements of the companies included in consolidation, the determination of the companies to be included in consolidation, the accounting and consolidation principles used and significant estimates made by the Company's Board of Managing Directors, as well as evaluating the overall presentation of the consolidated financial statements and the combined management report. We believe that our audit provides a reasonable basis for our opinion. Our audit has not led to any reservations. In our opinion based on the findings of our audit the consolidated financial statements comply with the IFRSs as adopted by the EU, and the additional requirements of German commercial law pursuant to 315a Abs. 1 HGB and give a true and fair view of the net assets, financial position and results of operations of the Group in accordance with these provisions. The combined management report is consistent with the consolidated financial statements and as a whole provides a suitable view of the Group's position and suitably presents the opportunities and risks of future development. Munich, March 22, 211 PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprüfungsgesellschaft Petra Justenhoven ppa. Katharina Deni German Public Auditor German Public Auditor 147

152 INDIVIDUAL FINANCIAL STATEMENTS AG-BALANCE SHEET (HGB) ASSETS (HGB) AG-BALANCE SHEET AT DECEMBER 31, 21 in EUR ' 12/31/21 12/31/29 Fixed assets EDP programs, brand name Other plant and office equipment Shares in affiliated companies Loans to affiliated companies Investments ,297 3,5 93, , ,297 11, 9,76 197,666 Current assets Trade accounts receivable thereof with a remaining term of more than one year TEUR (previous year TEUR ) Receivables from affiliated companies thereof with a remaining term of more than one year TEUR (previous year TEUR ) Receivables from companies in which participations are held thereof with a remaining term of more than one year TEUR (previous year TEUR ) Other assets thereof with a remaining term of more than one year TEUR 49 (previous year TEUR 98) Treasury stock Other securities Cash on hand and bank balances 27 8,551 3,92 1,872 27,114 48,462 89, , , ,811 2,195 85,1 Prepaid expenses Deferred tax assets 2,898 Total Assets 285,33 282,

153 EQUITY/LIABILITIES (HGB) AG-BALANCE SHEET AT DECEMBER 31, 21 in EUR ' Pre-column 12/31/21 12/31/29 Equity Subscribed capital Conditional capital TEUR 35,17 Less nominal value of treasury stock Capital reserve Revenue reserves 1. Treasury stock reserve 2. Other revenue reserves Accumulated loss 85, , ,78 2 5,91-165,487 19,262 85, , , ,57 Accruals Tax accruals Other accrued expenses 47 14,465 14, ,216 17,643 Liabilities Corporate bond thereof convertible TEUR (previous year TEUR ) thereof with a remaining term of up to one year TEUR 584 (previous year TEUR ) Trade accounts payable thereof with a remaining term of up to one year TEUR 482 (previous year TEUR 1,348) Liabilities to affiliated companies thereof with a remaining term of up to one year TEUR 97,889 (previous year TEUR 21,25) Liabilities to companies in which participations are held thereof with a remaining term of up to one year TEUR 153 (previous year TEUR 15) Other liabilities thereof with a remaining term of up to one year TEUR 16,674 (previous year TEUR 9,71) thereof from taxes TEUR 1,492 (previous year TEUR 28) 3, , ,674 16,782 1,348 18, ,71 149,646 Deferred income TOTAL EQUITY AND LIABILITIES 285,33 282,

154 INDIVIDUAL FINANCIAL STATEMENTS AG-PROFIT AND LOSS ACCOUNT (HGB) PROFIT AND LOSS ACCOUNT (HGB) JANUARY 1 TO DECEMBER 31, 21 in EUR ' 1/1 to 12/31/21 1/1 to 12/31/29 Sales Other operating income 8, ,699 Wages and salaries Social security and pension costs thereof for retirement provisions TEUR 1 (previous year TEUR 2) Personnel expenses -4, ,566-5, ,951 Amortization of intangible assets and depriciation of tangible assets Amortization and depreciation Other operating expenses Operating loss -6,754-3,33-17,597-9,7 Investment income Appreciation on financial assets Interest and similar income thereof from affiliated companies TEUR 981 (previous year TEUR 967) thereof income from discount TEUR 534 (previous year TEUR ) Write-downs of financial assets and current securities Interest and similar expenses thereof from affiliated companies TEUR 4,844 (previous year TEUR 4,858) thereof expenses from unwind of discount TEUR (previous year TEUR ) Loss from transfer expenses Financial result Loss from ordinary activities 2,96 4, ,664-6,61-6,2-9,323 2,51 3,367-26,67-7,51-27,166-55,46-64,413 Extraordinary income Extraordinary expenses Extraordinary result ,5-12,717 44,783 Taxes on income Other taxes Net loss Loss brought forward from the previous year Accumulated loss -2, , , , , ,98-153,336 15

155 FINANCE CALENDAR 211 IMPRINT THE COMPANY FINANCE CALENDAR 211 March 24, 211 Annual Report 21 May 211 Report for the first quarter of 211 June 211 Annual General Meeting (AGM) 21 August 211 Interim Financial Report 211 November 211 Report for the third quarter of 211 Imprint Published by Constantin Medien AG Münchener Straße 11g, Ismaning, Germany Phone +49 () , Fax +49 () HRB AG Munich Edited by Constantin Medien AG Communication/Accounting/ Investor Relations Frank Elsner Kommunikation für Unternehmen GmbH, Westerkappeln Designed by Brandsome GmbH Picture credits SPORT1 GmbH (pages 33, 34, 36, 37) The Associated Press (page 34) Constantin Sport Medien GmbH (pages 35, 36) Constantin Film AG (pages 38, 4, 41) Constantin Television GmbH/Network Movie Film- und Fernsehproduktion GmbH & Co. KG (page 39) Team Holding AG (page 43) Getty Images (page 42) All photographic material published in this report are protected by copyright, and may only be reproduced with the written permission of the originator. 151

156 CONSTANTIN MEDIEN AG Münchener Straße 11g Ismaning, Germany Phone +49 () Fax +49 () HRB Munich District Court