MTG announces 4Q 2014 results

Modern Times Group MTG AB (publ.) (“MTG” or “the Group”) (Nasdaq OMX Stockholm Large Cap Market: MTGA, MTGB) today announced its financial results for the fourth quarter and full year ended 31 December 2014.

MTG’s Nordic broadcasting business again delivered higher sales and profits, as the growth in our online businesses more than compensated for lower linear viewing levels and declining advertising markets. The Emerging Markets businesses grew their sales on a combined basis but higher profits in the free-TV business were offset by negative pay-TV earnings impacts.

Pay-TV Nordic

The total premium subscriber base was up quarter-on-quarter (q-o-q) and y-o-y, as the growth in the third party network subscriber base more than offset the ongoing decline in the satellite base.

Pay-TV Emerging Markets

The wholesale mini-pay channel business has added 39 million subscriptions y-o-y, with an underlying decrease of 3 million when excluding the contribution from Trace. The combined satellite pay-TV subscriber base continued to decline, which was primarily due to the geopolitical situation in Ukraine.

MTG announced that the Russian digital satellite TV platform Raduga TV would stop its broadcasting services on 5 December 2014 as it had not been granted the required broadcasting license from the local media regulator. MTG also announced that it would launch five new High Definition pay-TV channels in Russia during 2015.

The law prohibiting the sale of advertising on pay-TV channels in Russia has taken effect from the beginning of 2015. An amendment to the law that would allow advertising on pay-TV channels with 75% Russian content is now pending Presidential signature.

Key performance indicators – Subscriber data (‘000s)

                                                          2013                                2014
                                ------------------------------  ----------------------------------
                                    Q1      Q2      Q3      Q4       Q1       Q2       Q3       Q4
                                ------  ------  ------  ------  -------  -------  -------  -------
Pay-TV Nordic

Premium subscribers              1,003     989     970     977      978      970      969      982
- of which, satellite              580     569     563     559      553      546      535      526
- of which, 3rd party networks     424     421     407     418      425      425      434      456
Basic satellite subscribers         45      44      42      40       37       36       35       33

Pay-TV Emerging Markets

Satellite subscribers(1)           366     360     360     364      358      344      326      306
Mini-pay subscriptions(2)       85,153  89,915  91,380  92,223   94,837   94,197  130,559  131,089

1. Have been restated following the closure of Raduga.
2. Includes Trace subscriptions from Q3 2014. MTG acquired 75% of Africa-centric pay-TV operator Trace Partners SAS in June 2014.