Rcs Mediagroup

Earnings Release • May 11, 2016

RCS MediaGroup

Q1 2016 Results

Milan, May 11, 2016

Highlights

Market & Business Trends

Q1 2016 Results

Outlook 2016 and Plan Progress

Business Units Backup

Q1 2016 Results – Key highlights

EUR million

Other Revenue

Editorial Revenue

Agenda

Highlights

Market & Business Trends

Q1 2016 Results

Outlook 2016 and Plan Progress

Business Units Backup

Italian Advertising Trends: Market & RCS

Advertising Gross Revenue, YoY %

*** Based on same nr of issues

Spain: Advertising Trends

Advertising Gross Revenue, EUR million

	∆ (%)	∆ (%) Q1 16/Q1 15
Market	+3.2%
Cinema	+12.6%
Outdoor	+0.9%
Online	+12.6%	+13.0%
Radio	-2.5%
Magazines	-2.1%	0.0%
Newspapers	(1) -5.8%	-0.3%
TV	+5.8%

RCS

6 (1) Including special branded events referring to Unidad Editorial Unidad Editorial excluding third parties

Spanish Advertising Trends: Market & RCS

Advertising Gross Revenue, YoY %

* Adj: ex Sport Events

7

** Including special branded events referring to Unidad Editorial Source: Arce Media and internal estimates for National Newspapers

Italy: Newspaper Circulation Trends Circulation, copies/000 per day MARKET RCS National Newspapers Sports Newspapers 1,731 1,852 -6.5% Q1 2015 Q1 2016 346 377 Q1 2016 -8.3% Q1 2015 ex.financial daily -8.3% (1)

Spain: Newspaper Circulation Trends

Circulation, copies/000 per day

Q1 2015

Source: Nielsen Online – SiteCensus- Adobe Sitecatalyst

Q1 2016

Spain: Online Readership

Million Users

Source: Omniture

Agenda

Highlights

Market & Business Trends

Q1 2016 Results

Outlook 2016 and Plan Progress

Business Units Backup

Q1 2016 Results – Summary

EUR million

13

	Q1 2016	Q1 2015	∆ %
Total Revenue	219.8	229.4	(4.2%)
Circulation	94.7	107.1	(11.6%)
Advertising	97.4	96.3	1.1%
Other	27.7	26.0	6.5%
EBITD A ex NR Items	(3.4)	(15.5)	78.1%
Non Recurring Items	(0.3)	(0.7)
EBITD A	(3.7)	(16.2)	77.2%
EBIT	(17.5)	(30.9)	43.4%
Net Result	(22.0)	(35.2)	37.5%
NFP	(509.1)	(507.5)
NFP Pro forma *	(411)

* Considering the effect of the sale of the Books Division completed on 14 April 2016

In Q115 costs and revenues related to the Books activities were classified as Net Result from Discontinuing and Discontinued Op.. Starting from this Financial Report as of 31 December 2015, net results of equity-accounted investees were classified before EBITDA.

Q1 2016 Results – Profit & Loss

EUR million

	Q1 2016		Q1 2015		∆ %
Circulation	94.7	43.1%	107.1	46.7%	(11.6%)
Advertising	97.4	44.3%	96.3	42.0%	1.1%
Other	27.7	12.6%	26.0	11.3%	6.5%
TOTAL REVENUE	219.8	100%	229.4	100%	(4.2%)
Operating costs	(152.4)	(69.3%)	(171.3)	(74.7%)	(11.0%)
Labour costs	(70.8)	(32.2%)	(73.6)	(32.1%)	(3.8%)
EBITDA ex Non Recurring Items	(3.4)	(1.5%)	(15.5)	(6.8%)	78.1%
Non Recurring Items	(0.3)	(0.1%)	(0.7)	(0.3%)	ns
EBITDA	(3.7)	(1.7%)	(16.2)	(7.1%)	77.2%
D&A	(13.8)	(6.3%)	(14.7)	(6.4%)	ns
EBIT	(17.5)	(8.0%)	(30.9)	(13.5%)	43.4%
Net financial incomes (charges)	(7.9)	(3.6%)	(9.0)	(3.9%)	ns
PRE-TAX RESULT	(25.4)	(11.6%)	(39.9)	(17.4%)	36.3%
Taxes	3.2	1.5%	9.2	4.0%	ns
NET RESULT FROM CONTINUING OPERATIONS	(22.2)	(10.1%)	(30.7)	(13.4%)	27.7%
Net Result from Discontinuing and Discontinued Op.	0.0	0.0%	(4.9)	(2.1%)	ns
Minorities	0.2	0.1%	0.4	0.2%	ns
NET RESULT	(22.0)	(10.0%)	(35.2)	(15.3%)	37.5%

14 In Q115 costs and revenues related to the Books activities were classified as Net Result from Discontinuing and Discontinued Op.. Starting from this Financial Report as of 31 December 2015, net results of equity-accounted investees were classified before EBITDA .

2014-2016 EBITDA Evolution by Quarter

Variance Q1 2016 vs Q1 2015 – EBITDA

EUR million

New segments reporting

Media Italy

• Corriere della Sera System
• Gazzetta System
• Verticals
• Digicast

Media Spain

• El Mundo System
• Marca System
• Expansion System
• Verticals
• Events Last Lap
• Other

Advertising & Events

• Advertising RCS publishing
• Advertising 3rd party publishers
• Sport Events RCS Sport

Corporate & Other

• Corporate Functions
• Sfera
• New Business

Old segment reporting New segment reporting

News Italy

• Corriere della Sera System
• Verticals
• Digicast
• Sfera

News Spain

• El Mundo System
• Expansion System
• Verticals
• Other

Sport

• Gazzetta System
• Marca System
• International Sport events & formats (RCS Sport + Last Lap)
• International audience

Other activities

• Group shared services
• Advertising 3rd party publishers

Q1 2016 Results – Breakdown Revenue & EBITDA

EUR million

	Q1 2016				Q1 2015
	Revenue	EBITDA Ex Non Recurring Items	Ebitda ex NR %	EBITDA	Ebitda%	Revenue	EBITDA Ex Non Recurring Items	Ebitda ex NR %	EBITDA	Ebitda%
News Italy	89.5	0.3	0.3%	0.0	0.0%	97.9	(3.2)	(3.3%)	(3.4)	(3.5%)
News Spain	47.7	(2.3)	(4.8%)	(2.3)	(4.8%)	49.5	(3.6)	(7.3%)	(3.7)	(7.5%)
Sport	69.8	2.5	3.6%	2.5	3.6%	69.6	(2.2)	(3.2%)	(2.2)	(3.2%)
Other activities	12.8	(3.9)	n.s.	(3.9)	n.s.	12.4	(6.5)	n.s.	(6.9)	n.s.
CONSOLIDATED	219.8	(3.4)	(1.5%)	(3.7)	(1.7%)	229.4	(15.5)	(6.8%)	(16.2)	(7.1%)

Representation as of management reporting

18 Advertising revenues and costs (including overhead costs) for the Italian advertising agency (limited to advertising collection related to RCS publishing ) have been allocated in the individual business units in the first quarter 2016 and consistently in in the first quarter of 2015.

Balance Sheet

EUR million

	31/03/2016	31/12/2015
Net fixed assets	733.9	124.6%	745.0	125.9%
Tangible Intangible fixed & assets	530 0	90 0%	539 9	91 2%
Financial fixed assets	203 9	34 6%	205 1	34 7%
Net working capital	(76.8)	(13.0%)	(64.2)	(10.8%)
Reserve for risk and charges	(109.9)	(18.7%)	(115.6)	(19.5%)
Employee termination indemnity	(39.7)	(6.7%)	(40.1)	(6.8%)
Net invested capital: assets held for sale	81.4	13.8%	66.8	11.3%
CAPITAL EMPLOYED	588.9	100.0%	591.9	100.0%
Net financial debt (cash) total	509.1	86.4%	486.7	82.2%
of which financial debt (cash) of held for sale Net assets	(29 1)	(4 9%)	(44.2)	(7.5%)
Equity	79.8	13.6%	105.2	17.8%
EQUITY & NFP	588.9	100.0%	591.9	100.0%

Q1 2016 Cash Flow

EUR million

Agenda

Highlights

Market & Business Trends

FY 2015 Results

Outlook 2016 and Plan Progress

Business Units Backup

Outlook 2016 - confirmed the first year objectives of the 2016-2018 Business Plan

First Highlights on Q2 2016 - KPI

1 EBITDA: more than 80% of total year improvement will be achieved by Q2 2016

• 2 Total revenue: based on first 40 days of Q2 we expect quarterly revenue in line or better than LY
• Costs efficiencies: all plan initiatives already implemented, enabling to overachieve FY2016 target (40-45 million) to >50 million, out of 60 million target by 2018 3
• 4 Sport: stronger value extraction from iconic races (i.e. Giro d'Italia), launch of new mass event formats (i.e. Breakfast Run) and fast development of innovative digital properties (i.e. GazzaNet)
• 5 Financing: final agreement on term sheet, 2 Lending Banks already approved, all the other Lenders following internal approval processes within one month

2014-2016 EBITDA Evolution by Quarter

24

Agenda

Highlights

Market & Business Trends

Q1 2016 Results

Outlook 2016 and Plan Progress

Business Units Backup

News Italy – P&L			Verticals		TV
News
					Sfera
EUR million
			Q1 2016	Q1 2015	YoY
	Circulation		39.4	46.6	(15 5%)
	Advertising		42.8	44.2	(3 2%)
	Other		7.3		7.1 2 8%
	TOTAL REVENUE		89.5	97.9	(8 6%)
		add O/W on	8 5		(30 3%) 12 2
	EBITDA ex NR Items		0.3	(3.2)	n.a.
	EBITDA % NR ex		0 3%	(3	3%)
	Non Recurring Items		(0.3)		(0.2)
	EBITDA		0.0	(3.4)	n.a.

News Spain – P&L
News		Verticals & other
EUR million
	Q1 2016	Q1 2015	YoY
Circulation	20.2	23.1	(12 6%)
Advertising	23.1	21.6	6 9%
Other	4.4	4.8	(8 3%)
TOTAL REVENUE	47.7	49.5	(3 6%)
add O/W on	1 2	1 3	(7 7%)
EBITDA ex NR Items	(2.3)	(3.6)	36 1%
EBITDA % NR ex	(4 8%)	(7 3%)
Non Recurring Items	0.0	(0.1)
EBITDA	(2.3)	(3.7)	37 8%

Sport – P&L Editorial Italy Editorial Spain			Events and format
					International audience
								+
EUR million				Q1 2016		Q1 2015	YoY
	Circulation Advertising Other				35.1 21.9 12.8	37.6 21.0 11.0	(6 6%) 4 3% 16 4%
	TOTAL REVENUE				69.8	69.6	0 3%
		O/W	add on		9 9	10 3	(3 9%)
	EBITDA % ex Non Recurring Items	EBITDA ex NR Items NR			2.5 3 6% 0.0	(2.2) (3 2%) 0.0	n.a.
	EBITDA				2.5	(2.2)	n.a.

Representation as of management reporting

28 Events represented here are not an exhaustive list and refer to a selection of events in current portfolio of RCS Sport and Last Lap

Disclaimer

Investor Relations Department

+39 02 2584 5508 Federica.demedici@rcs.it Federica De Medici

Forward-looking Statements

Statements contained in this document, particularly the ones regarding any RCS MediaGroup possible or assumed future performance, are or may be forward looking statements and in this respect they involve some risks and uncertainties.

RCS MediaGroup actual results and developments may differ materially from the ones expressed or implied by the following statements depending on a variety of factors. Any reference to past performance of RCS MediaGroup shall not be taken as an indication of future performance.

This communication does not constitute an offer or solicitation for the sale, purchase or acquisition of securities of any of the companies mentioned in any jurisdiction and is directed to professionals of the financial community.

Riccardo Taranto, the Manager responsible for drawing up the company's accounting statements, hereby declares, pursuant to article 154-bis, paragraph 2 of the "Testo Unico della Finanza" (Legislative Decree n. 58/1998), that the information contained in this presentation corresponds to those one contained in the group's documents and books accounting records.