Viaplay Group

Earnings Release • Apr 26, 2022

2022 Q1

52% growth to 4.8m Viaplay subscribers with successful launch in the Netherlands

First quarter highlights

• Viaplay paying subscribers up 52% YoY to 4,783k (3,147) with 778k subscribers added QoQ
• 10% organic sales growth with reported sales of SEK 3,324m (2,982)
• Operating income before associated company income (ACI) and items affecting comparability (IAC) of SEK -49m (163) including SEK -305m impact of Viaplay International expansion
• Total reported operating income of SEK 602m (210) including ACI of SEK 55m (47) and IAC of SEK 595m (0) related to an agreed settlement of court cases with TV 2 Denmark
• Net income from total operations of SEK 483m (145), and EPS of SEK 6.20 (1.99)
• Adjusted net income from continuing operations of SEK 39m (231) and adjusted EPS of SEK 0.50 (3.16)

			Full
	Q1	Q1	year
(SEKm)	2022	2021	2021
Continuing operations
Net sales	3,324	2,982	12,661
Organic growth	9,9%	15.9%	16.7%
Operating income before ACI and IAC	-49	163	607
Associated company income (ACI)	55	47	40
Operating income before IAC	6	210	647
Items affecting comparability (IAC)1)	595	-	-74
Operating income	602	210	573
Net income from continuing operations	483	155	365
Net income from discontinued operations2)	-	-10	-40
Net income from total operations	483	145	325
Basic earnings per share (SEK)	6.20	1.99	4.23
Adjusted net income from continuing operations	39	231	864
Adjusted earnings per share from continuing operations (SEK)	0.50	3.16	11.26

Financial overview

.

1) Including the impact of the divestment of the NENT Studios UK content distribution business and impairment charges related to the studio assets in 2021, and the proceeds of the settlement of court cases with TV 2 Denmark in Q1 2022. Please see page 16 for details

2) Discontinued operations comprised NENT Group's non-scripted, branded entertainment and events businesses, which were divested in 2021. Please see note 4 for details. This report refers to NENT Group's continuing operations unless otherwise indicated.

Alternative performance measures used in this report are explained and reconciled on pages 15-19.

President & CEO's comments

"The launch of Viaplay in the Netherlands last month has beaten all expectations, and was the primary contributor to the Q1 intake of 778k Viaplay paying subscribers. Q1 was also our fifth consecutive quarter of double-digit organic sales growth. Our Nordic profits were up 29% despite significant content investments, and we delivered a group operating profit even when including the investments in our international expansion. The recently signed distribution agreement with Tele2 in Sweden has led us to upgrade our full year 2022 Viaplay subscriber target, with Viaplay revenue growth set to accelerate and the group revenue growth target unaffected."

Our 10% YoY group organic revenue growth in Q1 was again primarily driven by Viaplay (39% of sales). Viaplay is our largest and highest growth revenue generator, which is why we are proposing to take the natural next step of becoming Viaplay Group. Viaplay sales were up 26% on an organic basis after 52% YoY subscriber growth. We added 778k Viaplay subscribers in Q1 and 1,635k YoY, to end the quarter with a total of 4,783k subscribers.

The continued growth in the Nordic Viaplay subscriber base was complemented by a significant acceleration in the growth of the international subscriber base. This followed the very successful launch in the Netherlands at the beginning of March. The Netherlands accounted for the majority of the 1,208k international subscribers at the end of the quarter.

Viaplay premiered 13 new originals in Q1, as well as extending exclusive coverage of key sports rights in existing and new markets. We will premiere more than 70 Viaplay originals this year, and even more of the high profile and long term sports coverage that we have secured. Combined with new multi-year deals with Hollywood and independent studios, this means that we have full visibility over our contentrelated cost base moving forward.

The newly signed distribution agreement in Sweden will ensure that Viaplay will be part of each of Tele2's pay-TV offerings moving forward. This had no effect on the Q1 results, but we are

increasing our year-end 2022 Nordic Viaplay subscriber target from 4.3m to 4.8m. Our Nordic revenue growth target of approximately 20% for 2022 is unchanged, with the growth now even more weighted to Viaplay rather than linear subscription revenues. We are not changing our year-end target of 2.2m international Viaplay subscribers at this time, or our 2022 group revenue growth target of approximately 28%.

Linear subscription and other revenues (34% of sales) were up 4% YoY on an organic basis, with the lower growth reflecting the inclusion of the Studios operations. The growth rate is expected to accelerate as pay-TV prices rise in line with the enhanced content offerings.

Advertising revenues (26% of sales) were down 1% YoY on an organic basis, and reflected the Winter Olympics coverage on rival channels, as well as the impact of the Ukraine crisis. The 2022 annual agreements have now been concluded at higher prices with stable volumes.

The YoY increase in the profitability of our Nordic operations was achieved despite our ongoing investments in originals and new sports rights. The losses related to the international expansion were in line with expectations. Our full year outlook is unchanged. Allente delivered the anticipated positive earnings contribution, and will benefit from the full run-rate post-integration synergies.

The SEK 595m of proceeds from the Danish court cases has further strengthened our financial position. Our expansion plan is fully funded and is now accelerating as we continue to add the planned new content rights and expand into new markets. The investments that we are making in our growth are reducing like for like group profits in 2022, before they rise again significantly in 2023.

The humanitarian crisis in the Ukraine is a tragedy. We are doing all that we can to support the victims of the war through various group wide initiatives. This reflects our values as an organisation and our recently launched 5-year sustainability strategy, roadmap and targets, which are all about contributing to a sustainable future for all our stakeholders and societies.

Anders Jensen President & CEO

Sales

Group

Organic net sales were up 9.9% when excluding changes in FX rates and divested operations, and primarily reflected the growth of Viaplay. Reported sales amounted to SEK 3,324m (2,982). Please see page 15 for a reconciliation of organic and reported sales growth.

Organic sales growth

Viaplay subscribers

(thousands)

Sales by category

				Full
	Q1	Q1		year
(SEKm)	2022	2021	Change %	2021
Viaplay	1,302	1,012	28.7%	4,386
Linear subscription & other1)	1,146	1,111	3.1%	4,498
Advertising	876	859	2.0%	3,777
Total	3,324	2,982	11.5%	12,661

1) The previous separately reported 'Other subscription' and 'Studios & other' have been combined into 'Linear subscription & other'.

Viaplay was the largest quarterly revenue contributor and accounted for 39% of Group sales. Viaplay sales were up 26% on an organic basis, and included SEK 91m of international sales. The total Viaplay paying subscriber base grew by 52% YoY to 4,783k subscribers. Viaplay added 778k paying subscribers QoQ, with 117k added in the Nordics and 661k in the international markets. The launch of Viaplay in the Netherlands was the main contributor to the international subscriber growth, and Dutch subscribers represented the majority of the 1,208k international Viaplay subscribers at the end of the period.

Linear subscription and other sales, which now include both the linear channel subscription sales and Viaplay Studios' external sales, accounted for 34% of Group sales and were up 3.9% on an organic basis. The reported sales reflected the fact that the Q1 2021 Studios sales included SEK 39m of revenues for NENT Studios UK Limited, which was divested in June 2021. Linear channel subscription sales grew in line with the previous quarter and will benefit from price increases for the enhanced content offering following the addition of key new sports rights.

Advertising sales accounted for 26% of Group sales and declined 1% on an organic basis, which reflected market share changes due to the Winter Olympics being broadcast on competing commercial channels, as well as lower commercial channel viewing and softer advertising demand due to the impact of the Ukraine crisis. The 2022 annual agreements with advertisers have now been largely concluded with increased prices and similar volume commitments. NENT Group's TV audience share was up in Norway and Denmark, and

down in Sweden, with the TV advertising markets estimated to have grown in Sweden and Norway but declined in Denmark. NENT Group's radio audience share was up in both Norway and Sweden, with the radio advertising markets estimated to have grown in both markets.

Operating income

Operating expenses increased by 20% to SEK 3,382m (2,814), which primarily reflected the international expansion of Viaplay, as well as investments in new sports rights and Viaplay Original productions.

Operating income before ACI and IAC amounted to SEK -49m (163) and included SEK -305m (-36) impact of the investments in the international expansion. When excluding the impact of the international expansion, operating profits were up 29% to SEK 256m (199). Operating income before IAC amounted to SEK 6m (210) and included SEK 55m (47) of associated company income, which primarily comprised the Group's 50% share in the earnings of Allente. Please see note 3 regarding Allente's financial performance and position.

The previously announced DKK 430m received in Q1 from TV 2 Denmark in full and final settlement of the Danish Court cases has been reported as an item affecting comparability in Q1 and amounted to SEK 595m, net of advisor costs. Total operating income therefore amounted to SEK 602m (210).

Net financial items and net income

Net financial items totaled SEK -19m (-23). Net interest amounted to SEK -16m (-17), of which SEK -3m (-3) related to interest on net lease liabilities. Other financial items amounted to SEK -2m (-7) and mainly comprised financing arrangement fees and the impact of currency exchange rates on the revaluation of financial items.

Tax charges amounted to SEK -100m (-32) and included a tax charge related to the SEK 595m of proceeds from the Danish court case settlement. Net income from continuing operations totaled SEK 483m (155). There was no net income from discontinued operations in the quarter, compared to SEK -10m of net income in Q1 2021. Total net income for the Group amounted to SEK 483m (145), with total basic earnings per share of SEK 6.20 (1.99).

Cash flow and financial position

Cash flow from operating activities

Cash flow from operating activities amounted to SEK 492m (436). NENT Group received SEK 595m from the settlement of Danish court cases in the quarter, while the prior year cashflow included the receipt of a SEK 250m dividend from Allente. Changes in working capital amounted to SEK -1,418m (-895) and primarily reflected the increasing content investment levels, as well as changes in the timing of payments. The net operating cash flow for the quarter amounted to SEK -926m (-459).

Cash flow from investing activities

Total cash flow related to investing activities amounted to SEK -41m (-69), and included capital expenditure in tangible and intangible assets of SEK -45m (-58) and other investing activities totalling SEK 4m (-11).

Cash flow from financing activities

Cash flow from financing activities amounted to SEK 887m (3,085) and reflected a SEK 900m (-1,210) increase in the Group's borrowings in the quarter. Last year's cashflow from financing activities included the SEK 4,300m proceeds from the new share issue. The net change in cash and cash equivalents amounted to SEK -79m (2,558).

Financial position

The Group's net cash position at the end of the quarter was SEK 1,107m (777). The financial net cash position was SEK 1,462m (1,280). Cash and cash equivalents totalled SEK 5,642m (4,629), while lease liabilities net of sublease receivables amounted to SEK 355m (504).

Parent company

Nordic Entertainment Group AB is the Group's parent company and is responsible for Group-wide management, administration and financing.

Net sales for the Parent Company amounted to SEK 10m (13). Income before tax and appropriations amounted to SEK -56m (-36), and net income for the period amounted to SEK -45m (-29). The income statement and balance sheet for the Parent Company are presented on page 11.

Sustainability

NENT Group's five-year sustainability strategy was launched in conjunction with the 2021 Annual and Sustainability report. The strategy is part of NENT Group's business strategy and includes three focus areas: taking climate and environmental action, advancing diversity and inclusion, and promoting wellbeing and ethics. The strategy and roadmap include new science-based emission reduction targets and climate action initiatives to help limit global warming levels in accordance with the Paris agreement. NENT Group's first Task Force on Climate-related Financial Disclosures report will also soon be published. The 2021 Annual & Sustainability report details the Group's performance against its previous three-year strategy, including the improved gender balance and diversity across the business and in its productions. NENT Group has been recognised as one of the "best companies globally for gender balance" and ranked 56th globally and 2nd in Sweden in an analysis of 3,895 publicly listed companies by Equileap, a leading organisation providing data and insights on gender equality. The 'Viaplay Original Talent Awards' were launched in Q1 to support film students and emerging talents in creating relevant and innovative content.

NENT Group has taken several actions in response to the war in Ukraine, in order to support the victims of the war and bring pressure to bear on the Russian government. NENT Group has activated its platforms and services in partnership with Save the Children & the Red Cross to raise money for the relief efforts. Russian content has been removed from NENT Group platforms; contracts and counterparties have been screened to ensure compliance with international sanctions; and agreements involving payments to entities in Russia

have been discontinued. The Group has also established a fast-track recruitment programme in Sweden for Ukrainian applicants, which has already resulted in Ukrainian candidates taking up positions at NENT Group.

Other information

Significant events during and after the quarter

• 10 January Max Verstappen and Viaplay agree multi-year partnership
• 19 January NENT Group named as top sustainability performer by Sustainalytics
• 21 January NENT Group recognised as `Best Practice Leader' by European Women on Boards
• 3 February Viaplay announces distribution partnership with T-Mobile Netherlands
• 18 February NENT Group closes SEK 600m bond issue
• 23 February Viaplay becomes exclusive home of new DreamWorks Animation TV series in seven countries
• 1 March Viaplay goes live in the Netherlands with a unique combination of premium live sports, Viaplay Originals, Hollywood films and series, and kids content
• 16 March Viaplay and Tele2 agree Swedish distribution partnership
• 30 March NENT Group proposes rebrand to Viaplay Group
• 31 March NENT Group and TV 2 Denmark agree settlement of court cases
• 7 April NENT Group publishes 2021 Annual & Sustainability Report and new sustainability strategy
• 13 April NENT Group publishes Nomination Committee proposals and notices for 2022 AGM

A full list of announcements and reports can be found at www.nentgroup.com

Risks & uncertainties

Significant risks and uncertainties exist for the Group and the parent company. These factors include the prevailing economic and business environments in each of the Group's markets; commercial risks related to expansion into new territories; political and legislative risks related to changes in rules and regulations in the various territories in which the Group operates; exposure to foreign exchange rate movements; changes in the ability to access capital markets; and the competition for subscribers, content, and talent. The increasing shift towards online entertainment consumption and the Group's expansion also makes the Group a potential target for cyber-attacks, intrusions, disruptions or denials of service. The invasion of Ukraine by Russia in February 2022 has created adverse geo-political, market and other potential risks that can impact NENT Group. NENT Group is monitoring the situation closely and will act to mitigate any risks as far as possible and as they arise.

2025 targets

While NENT Group does not provide formal regular financial performance targets or guidance, it did provide a series of updated operational and financial targets at its Capital Markets Day on 22 September 2021:

• 1) Compound organic sales growth for the Group's total operations of approximately 18-20% between 2020 and 2025 (based on 2020 Group revenues excluding the contribution from the subsequently deconsolidated Viasat Consumer business)
• 2) Compound organic sales growth for the Group's Nordic operations of approximately 13-15% between 2020 and 2025 (based on 2020 Group revenues excluding the contribution from the subsequently deconsolidated Viasat Consumer business)
• 3) Compound organic sales growth for the Group's Viaplay Nordics operations of approximately 23- 25% between 2020 and 2025
• 4) Growth of the Viaplay Nordic paying subscriber base to approximately 6 million by the end of 2025, and growth of the Viaplay international paying subscriber base to approximately 6 million by the end of 2025
• 5) An operating income (EBIT) margin before ACI and IAC for the Group's Nordic operations of approximately 15% for the full year 2025 and a long term margin of approximately 20%
• 6) A positive operating income (EBIT) result for the Group's Viaplay International operations for the full year 2025, with a margin of approximately 15% in 2026 and a long term margin of approximately 25%
• 7) A balance sheet leverage ratio of less than 2.5x net debt to trailing twelve month adjusted EBITDA, although NENT Group's leverage may exceed these levels temporarily from time to time

Stockholm, 26 April 2022

Anders Jensen President & CEO

This report has not been reviewed by the Group's auditor.

Condensed consolidated income statement

			Full
	Q1	Q1	year
(SEKm)	2022	2021	2021
Continuing operations
Net sales	3,324	2,982	12,661
Cost of sales	-2,622	-2,198	-9,462
Gross income	702	784	3,199
Selling and marketing expenses	-290	-228	-1,030
General and administrative expenses	-470	-388	-1,632
Other operating income and expenses	605	-5	-4
Share of earnings in associated companies and joint ventures	55	47	40
Operating income	602	210	573
Net financial items	-19	-23	-97
Income before tax	583	187	476
Tax expenses	-100	-32	-111
Net income for the period, continuing operations	483	155	365
Net income for the period, discontinued operations	-	-10	-40
Net income for the period	483	145	325
Items that are or may be reclassified to profit or loss net of tax
Currency translation differences	96	154	140
Cash flow hedge	53	210	289
Other comprehensive income for the period	149	364	429
Total comprehensive income for the period	632	509	754
Net income for the period attributable to:
Equity holders of the parent company	483	145	325
Non-controlling interest	-	-	-
Total comprehensive income for the period attributable to:
Equity holders of the parent company	632	509	754
Non-controlling interest	-	-	-
Earnings per share
Basic earnings per share (SEK), continuing operations	6.20	2.13	4.76
Diluted earnings per share (SEK), continuing operations	6.18	2.12	4.74
Basic earnings per share (SEK)	6.20	1.99	4.23
Diluted earnings per share (SEK)	6.18	1.98	4.21
Number of shares
Shares outstanding at the end of the period	77,981,090	77,947,526	77,970,071
Basic average number of shares outstanding	77,970,193	73,000,859	76,731,753
Diluted average number of shares outstanding	78,225,862	73,304,595	77,031,536

Condensed consolidated balance sheet

(SEKm) 2021 2021 2022 Non -current assets Intangible assets 2,001 2,031 1,981 Machinery, equipment and installations 168 120 163 Right -of -use assets 313 350 321 Shares and participations 1,445 1,599 1,328 Sublease receivables 122 155 127 Other long -term receivables 147 133 144 Total non -current assets 4,196 4,388 4,064 Current assets Inventories 3,869 2,900 3,543 Accounts receivable 924 947 847 Sublease receivables 31 33 31 Prepaid expenses and accrued income 4,888 4,076 4,990 Other current receivables 373 290 350 Cash and cash equivalents 5,642 4,604 5,702 Assets held for sale - 1,352 - Total current assets 15,727 14,200 15,463 Total assets 19,923 18,588 19,527 Equity Equity 8,965 8,060 8,323 Non -controlling interest - 1 - Total equity 8,965 8,061 8,323 Non -current liabilities Long -term borrowings 3,400 3,300 2,500 Long -term lease liabilities 396 461 416 Long -term provisions 147 142 157 Other non -current liabilities 262 280 238 Total non -current liabilities 4,205 4,182 3,311 Current liabilities Short -term borrowings 800 50 800 Short -term lease liabilities 112 109 106 Short -term provisions 108 197 215 Other current liabilities 5,733 5,155 6,772 Liabilities related to assets held for sale - 834 - Total current liabilities 6,753 6,345 7,893 Total liabilities 10,958 10,527 11,204 Total equity and liabilities 19,923 18,588 19,527	31 Mar	31 Mar	31 Dec

Condensed consolidated statement of cash flow

			Full
	Q1	Q1	year
(SEKm)	2022	2021	2021
Operating activities
Net income for the period, continuing operations	483	155	365
Net income for the period, discontinued operations	-	-10	-40
Dividends from associated companies	-	250	500
Depreciation, amortisation and write-down	63	76	326
Other adjustments for non-cash items	-55	-35	143
Cash flow from operations, excluding changes in working capital	492	436	1,294
Changes in working capital	-1,418	-895	-817
Cash flow from operations	-926	-459	477
Investing activities
Divestments of operations	-	-	443
Capital expenditure in tangible and intangible assets	-45	-58	-216
Other investing activities	4	-11	16
Cash flow from investing activities	-41	-69	243
Financing activities
Net change in borrowings	900	-1,210	-1,260
Net change in leases	-17	-18	-83
Share issue, net of transaction costs	-	4,300	4,292
Other cash flow from financing activities	4	13	-39
Cash flow from financing activities	887	3,085	2,910
Change in cash and cash equivalents for the period	-79	2,558	3,630
Cash and cash equivalents at the beginning of the period	5,702	2,040	2,040
Translation differences in cash and cash equivalents	19	32	32
Cash and cash equivalents at end of the period	5,642	4,629	5,702
Of which cash and cash equivalents included in assets held for sale	-	26	-
Cash and cash equivalents at end of the period, continuing operations	5,642	4,604	5,702

Condensed consolidated statement of changes in equity

			Full
	Q1	Q1	year
(SEKm)	2022	2021	2021
Opening balance	8,323	3,237	3,237
Net income for the period	483	145	325
Other comprehensive income for the period	149	364	429
Total comprehensive income for the period	632	509	754
Share issue	-	4,346	4,346
Share issue transaction costs, net of tax	-	-36	-43
Effect of share based programmes	10	6	30
Change in non-controlling interests	-	-	-1
Closing balance	8,965	8,061	8,323

Parent company condensed income statement

			Full
	Q1	Q1	year
(SEKm)	2022	2021	2021
Net sales	10	13	86
General and administrative expenses	-79	-56	-228
Other operating income and expenses	-	-	1
Operating income	-69	-43	-141
Net financial items	13	7	58
Income before tax and appropriations	-56	-36	-83
Group contribution	-	-	186
Income before tax	-56	-36	103
Tax expenses	11	7	-
Net income for the period	-45	-29	103
Other comprehensive income	-	-	-
Total comprehensive income for the period	-45	-29	103

Parent company condensed balance sheet
	31 Mar	31 Mar	31 Dec
(SEKm)	2022	2021	2021
Non-current assets
Shares and participations in Group companies	207	127	202
Long-term receivables from Group companies	5,942	-	5,931
Total non-current assets	6,149	127	6,133
Current assets
Receivables from Group companies	2,244	7,802	943
Other current receivables	240	206	131
Cash and bank	5,538	4,531	5,590
Total current assets	8,022	12,539	6,664
Total assets	14,171	12,666	12,797
Shareholders' equity
Restricted equity	157	157	157
Non-restricted equity	6,412	6,297	6,447
Total equity	6,569	6,454	6,604
Non-current liabilities
Long-term borrowings	3,400	3,300	2,500
Other non-current liabilities	-	7	-
Total non-current liabilities	3,400	3,307	2,500
Current liabilities
Short-term borrowings	800	50	800
Liabilities to Group companies	3,119	2,576	2,643
Other current liabilities	283	279	250
Total current liabilities	4,202	2,905	3,693
Total equity and liabilities	14,171	12,666	12,797

Group performance data

	Q2	Q3	Q4	FY	Q1	Q2	Q3	Q4	FY	Q1
(SEKm)	2020	2020	2020	2020	2021	2021	2021	2021	2021	2022
Nordic sales	2,624	2,828	3,182	12,003	2,982	3,070	3,049	3,505	12,606	3,233
International sales	-	-	-	-	-	2	5	48	55	91
Total net sales	2,624	2,828	3,182	12,003	2,982	3,072	3,054	3,553	12,661	3,324
of which Viaplay -	798	957	983	3,625	1,012	1,076	1,100	1,198	4,386	1,302
of which Linear subscription & other -	1,088	1,108	1,102	4,946	1,111	1,056	1,118	1,214	4,498	1,146
of which Advertising -	738	762	1,097	3,433	859	941	837	1,140	3,777	876
Operating income before ACI and IAC	156	176	426	978	163	244	80	121	607	-49
Associated company income (ACI)	54	80	-35	100	47	9	34	-51	40	55
Operating income before IAC	210	256	392	1,077	210	253	114	69	647	6
Items affecting comparability (IAC)	2,383	-	-275	2,109	-	-74	-	-	-74	595
Operating income	2,594	256	117	3,186	210	179	114	69	573	602
Net income	2,515	188	-633	2,226	145	92	55	32	325	483
Basic earnings per share (SEK)	37.34	2.79	-9.40	33.06	1.99	1.18	0.71	0.41	4.23	6.20
Adjusted net income from continuing operations	148	219	432	957	231	266	179	189	864	39
Adjusted earnings per share from continuing operations (SEK)	2.20	3.25	6.41	14.21	3.16	3.41	2.30	2.43	11.26	0.50
Sales growth	-26.4%	-16.4%	-16.8%	-15.5%	-11.5%	17.1%	8.0%	11.7%	5.5%	11.5%
Organic growth	-12.6%	10.4%	6.1%	0.1%	15.9%	31.3%	9.9%	12.4%	16.7%	9.9%
Operating margin before ACI and IAC	6.0%	6.2%	13.4%	8.1%	5.5%	7.9%	2.6%	3.4%	4.8%	-1.5%
Operating margin	98.9%	9.1%	3.7%	26.5%	7.1%	5.8%	3.7%	2.0%	4.5%	18.1%
Net debt	4,189	3,865	3,026	3,026	-777	-1,697	-1,392	-2,059	-2,059	-1,107
Net debt/EBITDA 12 months trailing	2.6	2.5	2.2	2.2	-0.6	-1.2	-1.1	-2.1	-2.1	-1.4
ROCE	19.4%	17.2%	15.5%	15.5%	14.5%	15.3%	14.0%	9.9%	9.9%	6.6%
Viaplay subscribers ('000s)	2,716	2,813	3,020	-	3,147	3,287	3,608	4,005	-	4,783
of which Nordic subscribers ('000s) -	2,716	2,813	3,020	-	3,147	3,260	3,296	3,458	-	3,576
of which International subscribers ('000s) -						27	313	547	-	1,208
CSOV Sweden (25-59) %	22.4	22.6	21.6	22.5	22.5	21.3	20.2	22.0	21.7	21,3
CSOV Norway (25-59) %	15.3	12.9	16.9	15.8	15.3	15.3	17.0	20.2	17.2	16,6
CSOV Denmark (25-59) %	19.9	21.7	20.3	20.2	17.8	22.7	19.1	18.4	19.3	19,0
CSOL Sweden (12-79) %	39.3	44.6	39.4	40.7	39.0	39.2	40.1	40.1	39.6	43,5
CSOL Norway (12+) %	66.7	66.4	66.5	66.4	67.0	67.4	68.2	67.3	66.7	69,7

Notes

Note 1 - Accounting policies

This Interim report has been prepared according to 'IAS 34 Interim Financial Reporting' and 'The Annual Accounts Act'. The interim report for the parent company has been prepared according to the Annual Accounts Act - Chapter 9 'Interim Report'.

The Group's financial accounts and the parent company accounts have been prepared according to the same accounting policies and calculation methods as were applied in the preparation of the 2021 Annual Report.

Note 2 – Disaggregation of revenue

	Q1	Q1	Full year
(SEKm)	2022	2021	2021
Revenue streams
Subscription	2,272	1,871	7,932
Advertising	876	859	3,777
Licenses, royalities and other	149	209	694
Production	28	44	258
Total	3,324	2,982	12,661
Revenue recognition
at a point in time	149	209	694
over time	3,175	2,774	11,967
Total	3,324	2,982	12,661

Note 3 – Income from associated company Allente

Allente's subscribers and revenues declined, with the operating income including SEK 9m of integration costs that were reported as items affecting comparability. Amortisation and depreciation charges for the period included SEK 86m (83) of PPA-related charges.

NENT Group's 50% share of Allente's net income of SEK 116m amounted to SEK 58m.

	Q1	Q1	Full year
(SEKm)	2022	2021	2021
Net sales	1,680	1,691	6,817
EBITDA before IAC	267	338	1,328
Depreciation and amortisation	-109	-109	-433
Operating income before IAC	157	229	895
Items affecting comparability (IAC)	-9	-107	-736
Operating income	148	121	159
Financial items	-2	5	-55
Tax	-30	-27	-22
Net income	116	100	82
NENT Group 50% share of net income	58	50	41
Net debt	2,071	1,541	2,156
Total subscribers (thousand)	1,047	1,109	1,064

Note 4 - Discontinued operations

The discontinued operations comprised the non-scripted production, branded entertainment and events business that was divested during 2021. These businesses were part of the Studios segment and reported as assets held for sale and discontinued operations since Q2 2020. The net income, assets and liabilities of the operations were reported in a separate line in the consolidated income statement and balance sheet, with historical figures restated accordingly. Splay One was divested on 6 April 2021 and the remaining discontinued studios businesses were divested on 30 September 2021. The capital loss including transaction costs from the divestments was reported as an item affecting comparability within discontinued operations.

	Q1	Q1	Full year
(SEKm)	2022	2021	2021
External sales	-	234	615
Internal sales	-	30	60
Cost of sales	-	-211	-548
Selling, Technology and administration expenses	-	-62	-123
Items affecting comparability	-	-	-45
Other income and expenses	-	1	3
Operating income	-	-8	-38
Financial net & Tax	-	-1	-3
Net income, discontinued operations	-	-10	-40

Note 5 – Number of shares

Nordic Entertainment Group AB issued 10,600,000 new Class B shares in February 2021. This resulted in a 15.6% increase in the total number of shares from 67,842,244 to 78,442,244.

	Class A	Class B	Class C
Parent company	Shares	Shares	Shares	Total
Number of shares as at 31 December 2021	532,572	77,439,153	470,519	78,442,244
Reclassification of Class A shares	-1,036	1,036	-	-
Share awards vested (LTI 2019)	-	11,019	-11,019	-
Number of shares at 31 March 2022	531,536	77,451,208		459,500 78,442,244
Of which treasury shares	-	-1,654	-459,500	-461,154
Number of shares excl treasury shares as at 31 March 2022	531,536	77,449,554	-	77,981,090

Note 6 – Related party transactions

The Group has related party relationships with its subsidiaries, associated companies and joint ventures. All related party transactions are based on market terms and negotiated on an arm's length basis.

The purpose of Alternative Performance Measures (APMs) is to facilitate the analysis of business performance and industry trends that cannot be directly derived from financial statements. NENT Group is using the following Alternative Performance Measures:

• Change in net sales from Organic growth, Acquisitions/divestments and Changes in FX rates
• Operating income before associated company income (ACI) and items affecting comparability (IAC)
• Operating income before IAC
• Net debt and Net debt/EBITDA
• Capital Employed and Return on Capital Employed (ROCE)
• Adjusted net income and earnings per share

Reconciliation of sales growth

Since the Group generates the majority of its sales in currencies other than in the reporting currency (i.e. SEK, Swedish Krona) and currency rates have proven to be rather volatile, and due to the fact that the Group has historically made several acquisitions and divestments, the Company's sales trends and performance are analysed as changes in organic sales growth. This presents the increase or decrease in the overall SEK net sales on a comparable basis, allowing separate discussion of the impact of acquisitions/divestments and exchange rates.

Organic growth, i.e. sales growth adjusted for acquisitions/divestments and changes in FX rates, amounted to 9.9.% in Q1 2022.

Q1 (SEKm)	Reported Net sales	Acquisitions / divestments	Net sales adjusted for acquisitions / divestments	Changes in FX rates	Net Sales adjusted for acquisitions/ divestments and changes in FX rates
2022	3,324		3,324	-89	3,235
2021	2,982	-39	2,943		2,943
Growth	342		381		292
Growth %	11.5%		12.9%		9.9%

Operating income before associated company income (ACI) and items affecting comparability (IAC) refers to operating income after the reversal of material items and events related to changes in the Group's structure or lines of business, which are relevant for understanding the Group's development on a like-forlike basis. This measure is used by management to follow and analyse the underlying profits and to offer more comparable figures between periods.

Operating income before IAC and associated companies income

			Full
	Q1	Q1	year
(SEKm)	2022	2021	2021
Operating income	602	210	573
Items affecting comparability (IAC)	595	-	-74
Operating income before IAC	6	210	647
Associated company income (ACI)	55	47	40
Operating income before ACI and IAC	-49	163	607

Items affecting comparability

(SEKm)	Q1 2022	Q1 2021	Full year 2021
Capital loss from divestment of NENT Studio UK and write down Studio assets	-	-	-74
Settlement of court cases	595	-	-
Total	595	-	-74

Items affecting comparability classified by function

(SEKm)	Q1 2022	Q1 2021	Full year 2021
Cost of sales	-	-	-
Administrative expenses	-	-	-
Other operating income and expenses	595	-	-74
Total	595	-	-74

Reconciliation of net debt/EBITDA ratio

Net debt refers to the sum of interest-bearing liabilities less total cash and interest-bearing assets. Net debt also includes lease liabilities net of sublease receivables and dividends payable. Net debt is used by Group management to track the indebtedness of the Group and to analyse the leverage and refinancing needs of the Group. The net debt to EBITDA ratio provides a KPI for net debt in relation to cash profits generated by the business, i.e. an indication of a business' ability to pay its debts. This measure is commonly used by financial institutions to rate creditworthiness. A negative figure indicates that the Group has a net cash position (cash in excess of interest-bearing liabilities).

Net debt

	30	30		31	30	30	31	31
	Jun	Sep	31 Dec	Mar	Jun	Sep	Dec	Mar
(SEKm)	2020	2020	2020	2021	2021	2021	2021	2022
Short-term borrowings	2,580	1,980	1,260	50	800	800	800	800
Long-term borrowings	2,600	3,300	3,300	3,300	2,500	2,500	2,500	3,400
Total financial borrowings	5,180	5,280	4,560	3,350	3,300	3,300	3,300	4,200
Interest bearing receivables					40	40	20	20
Cash and cash equivalents	1,493	1,912	2,036	4,604	5,415	5,014	5,702	5,642
Cash and cash equivalents included in assets held for sale	31	24	4	26	5	-	-	-
Financial net debt	3,656	3,344	2,520	-1,280	-2,160		-1,754 -2,422	-1,462
Lease liabilities	608	597	566	569	539	534	522	508
Lease liabilities included in liabilities related to assets held for sale	124	118	120	122	102	-	-	-
Sublease receivables	199	194	181	188	178	172	158	153
Total lease liabilities net	533	521	505	504	463	362	364	355
Net debt	4,189	3,865	3,026	-777	-1,697		-1,392 -2,059	-1,107

Net debt/EBITDA before IAC

	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1
(SEKm)	2020	2020	2020	2021	2021	2021	2021	2022
Operating income before IAC, continuing operations	1,157	1,148	1,077	1,069	1,111	969	647	443
Operating income before IAC, discontinued operations	91	44	-12	-20	-10	2	8	16
Depreciation, amortisation and write-downs, continuing operations1)	284	277	267	264	264	267	296	294
Depreciation, amortisation and write-downs, discontinued operations1)	49	49	48	47	44	42	30	19
EBITDA 12 months trailing	1,581	1,518	1,379	1,359	1,409	1,280	980	772
Net debt	4,189	3,865	3,026	-777	-1,697	-1,392	-2,059	-1,107
Total net debt / EBITDA 12 months trailing	2.6	2.5	2.2	-0.6	-1.2	-1.1	-2.1	-1.4

1) Refers to non-current assets only

Reconciliation of Return on Capital Employed (ROCE)

Return on capital employed is a performance measure for operating income before items affecting comparability in relation to the capital employed within the operations. Operating income before items affecting comparability is the main profit metric that operations are responsible for, and is measured before interest and taxes. Capital employed is the sum of current and non-current assets less current and non-current liabilities, provisions and liabilities at fair value. All items are non-interest-bearing. Capital employed equals the sum of equity and net debt.

Return on Capital Employed (ROCE)

	Q2	Q3	Q4	Q1	Q2	Q3	Q4	Q1
(SEKm)	2020	2020	2020	2021	2021	2021	2021	2022
Inventory	2,853	2,708	2,614	2,900	3,009	3,252	3,543	3,869
Accounts receivables	897	970	789	947	899	1,089	847	924
Prepaid expense and accrued income	3,910	4,053	3,998	4,076	4,238	4,196	4,990	4,888
Other current assets	517	462	682	290	406	261	350	373
Other current liabilities	-6,326	-6,575	-6,124	-5,155	-6,245	-5,498	-6,772	-5,733
Total working capital	1,853	1,617	1,959	3,057	2,307	3,300	2,958	4,321
Intangibles assets	2,238	2,257	1,998	2,031	1,998	1,992	1,981	2,001
Machinery, equipment and installations	132	90	96	120	131	148	163	168
Right-of-use assets	383	375	360	350	330	335	321	313
Shares and participations	2,868	2,948	1,720	1,599	1,577	1,495	1,328	1,445
Other long-term receivables	133	162	176	133	127	115	124	127
Capital employed held for sale	1,172	1,154	635	614	498	-	-	-
Provisions	-348	-349	-322	-339	-351	-360	-372	-255
Other non-current liabilities	-291	-306	-360	-280	-256	-213	-238	-262
	6,288	6,330	4,304	4,227	4,054	3,512	3,306	3,538
Other items included in the capital employed
Capital employed	8,140	7,947	6,263	7,284	6,361	6,812	6,264	7,858
Operating income before IAC 12 months trailing, continuing
operations	1,157	1,148	1,077	1,069	1,111	969	647	443
Operating income before IAC 12 months trailing,
discontinued operations	91	44	-12	-20	-10	2	8	16
Operating income before IAC 12 months trailing, total	1,248	1,192	1,065	1,049	1,101	971	655	459
Average Capital Employed (5 quarters)	6,434	6,910	6,864	7,205	7,199	6,933	6,597	6,916
ROCE %	19.4%	17.2%	15.5%	14.5%	15.3%	14.0%	9.9%	6.6%
Assets held for sale	1,564	1,615	1,299	1,352	846	-	-	-
Cash and cash equivalents included in assets held for sale	-31	-24	-4	-26	-5	-	-	-
Liabilities related to assets held for sale	-485	-555	-781	-834	-446	-	-	-
Lease liability, included in liabilities related to assets held for sale	124	118	120	122	102	-	-	-

Adjusted net income from continuing operations

Adjusted net income and earnings per share are the Group's net income and EPS from continuing operations when excluding items affecting comparability and the amortisation of acquisition-related intangible assets, net of tax, for both NENT Group and its 50% share in the earnings of Allente. These performance measures provide a relevant metric to better understand the Group's underlying results and development. Please see note 3 for more information on Allente's performance and page 16 regarding NENT Group's items affecting comparability.

	Q1	Q1	Full year
(SEKm)	2022	2021	2021
Net income, continuing operations	483	155	365
Adjustment items	-444	76	499
Adjusted net income from continuing operations	39	231	864
Basic average number of shares outstanding	77,970,193	73,000,859	76,731,753
Adjusted earnings per share from continuing operations (SEK)	0.50	3.16	11.26
Adjustment items NENT Group IAC	595	-	-74
Tax effect on IAC	-113	-	-
Amortisations of surplus value (PPA)	-1	-2	-8
Tax effect on amortisations of surplus value (PPA)	0	-	2
Allente
IAC	-5	-54	-368
Tax effect on IAC	1	12	80
Amortisations of surplus value (PPA)	-43	-42	-167
Tax effect on amortisations of surplus value (PPA)	9	9	36
Adjustment items	444	-76	-499

Definitions

Associated company income (ACI)

Associated companies are companies in which the Group holds voting rights of at least 20% and no more than 50%. Associated company income is the Group's share of the associated company's net income.

Capital employed

Capital employed is the sum of current and non-current assets less current and non-current liabilities, provisions and liabilities at fair value. All items are non-interest-bearing.

Commercial Share of Listening (CSOL)

CSOL comprises NENT Group's estimated share of commercial radio listening amongst 12+ year olds in Norway and 12-79 year olds in Sweden.

Commercial Share of Viewing (CSOV)

CSOV comprises NENT Group's estimated share of commercial TV viewing amongst 25-59 year olds.

Earnings per share

Earnings per share is expressed as net income attributable to equity holders of the parent divided by the average number of shares outstanding.

EBITDA

EBITDA is Earnings Before Interest, Taxes, Depreciation and Amortisation.

Items Affecting Comparability (IAC)

Items Affecting Comparability refer to material items and events related to changes in the Group's structure or lines of business, which are relevant for understanding the Group's development on a like-forlike basis.

Net debt

Net debt is the sum of short and long-term interest-bearing liabilities less total cash and interest-bearing assets. Net debt also includes lease liabilities net of sublease receivables and dividends payable. A negative figure indicates that the Group has a net cash position (cash in excess of interest-bearing liabilities).

Operating expenses

Operating expenses comprises of Cost of sales, Selling and marketing expenses and Administrative expenses.

Operating income

Operating income comprises results before interest and taxes, otherwise known as EBIT (Earnings Before Interest and Taxes).

Organic growth

Organic growth is the change in net sales compared to the same period of the previous year excluding acquisitions and divestments and adjusted for currency translation and transaction effects.

Return On Capital Employed (ROCE) %

Return on capital employed is calculated as operating income as a percentage of average capital employed.

Viaplay subscribers

A Viaplay subscriber is defined as a customer who has access to Viaplay and for whom a method of payment has been provided. NENT Group only reports paid-for subscriptions where a payment has been received directly from the end-customer or from a partner organisation.

Shareholder information

2022 Annual General Meeting

Nordic Entertainment Group AB (publ)'s Annual General Meeting of shareholders will be held on Wednesday 18 May 2022 by postal voting. As previously communicated, the NENT Group Board of Directors will propose to the Annual General Meeting that no cash dividend be paid for 2021 and that the 2021 profits be carried forward into 2022. The AGM resolutions will be published as soon as the outcome of the postal voting has been established. The AGM notice and related documentation are available at www.nentgroup.com.

Financial calendar 2022

Annual General Meeting	18 May
Publication of Q2 interim report	21 July
Publication of Q3 interim report	25 October

Questions?

press@nentgroup.com (or Roberta Alenius, Head of Corporate Communications: +46 70 270 72 17) investors@nentgroup.com (or Matthew Hooper, Chief Corporate Affairs Officer: +44 7768 440 414)

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Teleconference and webcast

A teleconference and webcast will be held at 09.00 Stockholm local time, 08.00 London local time and 03.00 New York local time. The webcast will be streamed via the following link: https://edge.media-server.com/mmc/p/a35cv39c

To participate in the conference call, please dial: Sweden: +46 (0) 8 50 69 21 80 UK: +44 (0) 20 71 92 80 00 US: +1 63 15 10 74 95

The access code for the call is 7799512.

+46 (0)8 562 023 00

nentgroup.com

investors@nentgroup.com

Nordic Entertainment Group AB (publ) (NENT Group)'s Viaplay streaming service is available in Sweden, Denmark, Norway, Finland, Iceland, Estonia, Latvia, Lithuania, Poland, the US and the Netherlands. Viaplay will launch in the UK in 2022, followed by Canada, Germany, Austria and Switzerland by the end of 2023. We operate streaming services, TV channels, radio stations and production companies, and our purpose is to tell stories, touch lives and expand worlds. Headquartered in Stockholm with a global perspective, NENT Group is listed on Nasdaq Stockholm (`NENT B'). NENT Group has proposed to rebrand as Viaplay Group, subject to approval at its Annual General Meeting on 18 May. This information is information that Nordic Entertainment Group AB (publ) (NENT Group) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 07:30 CET on 26 April 2022.