Cyfrowy Polsat S A : Brief

Analyst and investor briefing Q1'24

1

Financial results of Polsat Plus Group in Q1'24

After taking control of PAK-PCE and its subsidiaries on July 3, 2023, the Group began to consolidate the results of PAK-PCE Group using the full method. As a result, the Group recognizes additional revenue and expenses, particularly those related to the production and sale of electricity.

PLNm		Q1'24			YoY
			change
Revenue, incl.:		3,405		6%
-	Retail revenue		1,771		2%
-	Wholesale revenue		750		-5%
-	Sale of equipment		426		-12%
-	Energy revenue		282		-
-	Other revenue		177		-6%

Market consensus1) Difference

3,434 -0.9%

Operating costs, incl.:

• Technical costs and cost of settlements with telecommunication operators
• Depreciation, amortization, impairment and liquidation
• Cost of equipment sold
• Content costs
• Cost of energy sold, includes
• • Depreciation
• Distribution, marketing, customer relation management and retention costs
• Salaries and employee-related costs
• Cost of debt collection services and bad debt allowance and receivables written off
• Other costs, includes
• • Depreciation

3,116	8%
803	-1%
481	4%
328	-17%
513	0%
242	n/d
12	n/d
269	10%
304	10%
13	-55%
164	0%
1	n/d

EBITDA adjusted

excl. disposal of assets 2)

EBITDA adjusted margin excl. disposal of assets 2)

772	2%	751	2.8%
	-1.1pp			0.8 pp
22.7%
21.9%

EBITDA	946	24%	916	3.3%
EBITDA margin	27.8%	4.0pp	26.7%	1.1 pp
EBIT	453	52%	432	4.7%
Net profit	184	160%	165	11.9%

1. Based on estimates prepared by: BM mBanku, BM BDM, DM BOŚ, DM PKO BP, ERSTE, Ipopema, Trigon, Pekao, Santander,
   Wood&Co
2. EBITDA excluding in Q1'24: gain on the sale of shares in Muzo.fm Sp. z o.o. of PLN 10 million and excluding proceeds from the disposal of the first part of the IPv4 address package for PLN 164 million net of transaction costs

Analyst and investor briefing Q1'24

2

• Polsat Plus Group's revenue amounted to PLN 3,405m (+6.4% YoY). Excluding the impact of consolidation of PAK-PCEGroup, the Group's revenue amounted to PLN 3,103m (-3.0%YoY). The level of total revenue was mainly influenced by:
• • Recognition of energy revenue of PLN 282m, including revenue from the sale of electricity from production and resale of energy, revenue from the sale of heat and revenue from the sale of property rights, particularly certificates of origin. Consolidated revenue from the sale of own energy amounted to PLN 87m, and revenue from energy resale amounted to PLN 168m.
  • Higher retail revenue (+2% YoY) which resulted from the higher ARPU from contract B2C customers and prepaid ARPU.
  • Lower sale of equipment (-12%YoY) mainly due to high sales volumes in the comparative period.
  • Lower wholesale revenue (-5%YoY) mainly due to the recognition of lower interconnection revenue, resulting from the final regulatory reduction of MTR rates, and lower revenue from the sale of TV sublicenses, which was partially compensated by an increase of advertising and sponsorship revenue.
• Polsat Plus Group's costs amounted to PLN 3,116m (+7.8% YoY). Excluding the impact of the consolidation of PAK-PCE Group, operating costs amounted to PLN 2,843m (-1.7% YoY). Their level was mainly influenced by the following factors:
• • Recognition of the cost of energy sold in the amount of PLN 242m.
  • Lower cost of equipment sold (-17%YoY), which reflected lower sales volumes of equipment in the reported quarter and corresponds with lower revenue from the sale of equipment.
  • Increase in salaries and employee-relatedcosts (+10% YoY) mainly due to a higher headcount and persisting inflationary pressure.
  • Increase in distribution, marketing, customer relation management and retention (+10% YoY), mainly as a result of the recognition of higher costs of call center and marketing activities Q1'24.
  • Higher depreciation, amortization, impairment and liquidation costs (+4% YoY), which resulted, among others, from the consolidation of PAK-PCEGroup.
  • Decrease in cost of debt collection services and bad debt allowance and receivables written (-55%YoY) primarily due to a one-timereassessment of the total package of receivables according to a higher ratio than in the comparative period. In addition, the lower level of bad debt is influenced by better collection rates and lower sales in the installment model than in Q1'23.
• EBITDA adjusted by the gain on the disposal of a subsidiary and an associate, excl. the disposal of assets3), amounted to PLN 772m (+1.5% YoY), with a margin of 22.7%. The main reason behind this increase was the contribution from the green energy segment following the consolidation of PAK-PCEGroup.
• Reported EBITDA amounted to 946m (+24% YoY).
• EBIT amounted to PLN 453m.
• Finance costs, net decreased by PLN 54m YoY primarily due to the recognition of a non-cash, positive impact of PLN 24m from the revaluation of the euro-denominated tranche of the SFA following the appreciation of the Polish zloty in Q1'24. Moreover, the Group recognized a positive impact from the execution and valuation of hedging instruments in the amount of PLN 45m.
• Net profit of the Group amounted to PLN 184m (+160% YoY).

3 EBITDA excluding in Q1'24: gain on the sale of shares in Muzo.fm Sp. z o.o. of PLN 10 million and excluding proceeds from the disposal of the first part of the IPv4 address package for PLN 164 million net of transaction costs

Analyst and investor briefing Q1'24

3

• Adjusted FCF LTM after interest, excl. green energy capex amounted to PLN 442m (+32% vs. FY'23) in Q1'24. The FCF LTM result remains under the influence of high interest expenses.
• In the TMT4 space, CAPEX/revenue ratio at 7.7%.
• The main covenant - net debt/EBITDA LTM (excl. project financing5) at the level of 3.40x.
• Net debt/EBITDA LTM incl. project financing at the level of 3.70x.

1. Includes B2C and B2B services and media segments
2. Liabilities under loans and credits granted to PAK-PCE and investment loans granted to PAK-PCE subsidiaries (project companies) for certain investment projects related to the development of low and zero carbon energy sources

Analyst and investor briefing Q1'24

4

B2C and B2B services segment

		Q1'24			Q1'23		YoY
					change
B2C AND B2B SERVICES SEGMENT1)
Total number of B2C RGUs (EOP) [thous.], incl.:		13,077		13,163	-0.7%
Pay TV		4,804		4,951	-3.0%
Mobile telephony		6,273		6,232	0.7%
Internet		2,000		1,980	1.0%
Number of B2C customers (EOP) [thous.]		5,772		5,887	-2.0%
ARPU per B2C customer [PLN]		74.6		71.4	4.5%
Churn in B2C subsegment		7.6%		7.2%		0.4 pp.
RGU saturation per one B2C customer		2.27		2.24	1.3%
PREPAID SERVICES
Total number of RGUs (EOP) [thous.], incl.:		2,624		2,693	-2.6%
Pay TV		123		121	1.7%
Mobile telephony		2,476		2,542	-2.6%
Internet		25		30	-16.7%
ARPU per prepaid RGU[PLN]		17.3		17.1	1.2%
CONTRACT SERVICES FOR B2B CUSTOMERS
Total number of B2B customers (EOP) [thous.]		68.4		69.3	-1.3%
ARPU per B2B customer [PLN]		1,490		1,434	3.9%
FINANCIAL RESULTS [PLNm]
Revenue		2,576		2,675	-3.7%
EBITDA excl. disposal of assets2)		634		663	-4.4%
CAPEX		217		270	-19.4%

1. excl. low-margin Polsat Box Go Start package
2. EBITDA excluding in Q1'24 proceeds from the disposal of the first part of the IPv4 address package for PLN 164 million net of transaction costs

Contract services for B2C customers:

• B2C contract customer base at 5,772K (-2.0% YoY). The main reason behind the decrease was the declining popularity of the satellite technology as well as the continued process of merging contracts under one common contract for the household within our base.
• Churn at a low 7.6% per annum, mainly as a result of the high loyalty of our bundled service customers, which in turn is due to the successful implementation of our multiplay strategy.
• ARPU per B2C contract customer at PLN 74.6 (+4.5% YoY), thanks to upselling and cross-sellingadditional products and services to our customer base as part of our multiplay offer and offering richer TV and telecom packages (more-for-morestrategy).
• Decrease in total B2C contract services base by 86k to 13,077k (-0.7%)YoY.
• • Stable base of mobile telephony RGUs at 6,273K and Internet RGUs at 2.000k.
  • Pay-TVservices amounted to 4,804k RGUs and recorded a decrease of 147k (-3.0%YoY), mainly as a result of a lower number of provided satellite TV services and the price repositioning and change in the strategy of offering our video online services. This decrease was partially compensated by an increasing number of TV services offered in online technologies (IPTV/OTT).
• 2.47m customers, or 43% of the total base, use our multiplay offering and have a total of 7,468k services (+47k YoY).

Analyst and investor briefing Q1'24

5

Prepaid services:

• The prepaid RGU base6) amounted to 2,624k, recording a decrease of 69k YoY (-2.6%). The main reasons for the decline were:
• • 66k lower number of prepaid mobile services, due to intensified competition in this market segment;
  • the growing popularity of data transmission in voice tariffs due to the disappearing differences in the size of data packages, which translates into a systematic decline in the number of dedicated mobile Internet services.
• Prepaid ARPU6) amounted to PLN 17.3 (+1.2% YoY).

Contract services for B2B customers:

• Contract B2B customers base at 68.4K (-1.3%YoY).
• ARPU per B2B customer increased to PLN 1,490 per month (+3.9% YoY).

6 excl. low-margin Polsat Box Go Start package

Analyst and investor briefing Q1'24

6

Media segment: television and online

				Q1'24				Q1'23		YoY
								change
TELEVISION
Audience share1), including:	21.53%		21.85%			-0.32 pp
POLSAT (main channel)	7.10%		8.00%			-0.90 pp
Other channels	14.43%		13.85%			0.58 pp.
Advertising market share2)	28.1%		28.4%			-0.3 pp
Market expenditures on TV advertising and sponsorship3)	1,092		1,001		9.0%
[mPLN]
Revenue from advertising and sponsorship of TV Polsat	307		284		8.0%
Group4) [mPLN]
ONLINE: POLSAT-INTERIA GROUP5)
Average monthly number of users [millions]	21.0		21.2		-0.9%
Average monthly number of page views [millions]	1,926		1,938		-0.6%
FINANCIAL RESULTS [PLNm]
Revenue			585			568		3.1%
EBITDA adjusted6)	91		93		-1.7%
CAPEX	26		22		17.9%

1. NAM, All 16‐59, all day, SHR%, including Live+2 (i.e. Time Shifted Viewing), and TV audience out of home (OOH - out of home viewing), internal analyses
2. Our estimates based on Publicis Groupe data
3. Publicis Groupe, preliminary data, spot advertising and sponsorship
4. Revenue from TV advertising and sponsorship of TV Polsat Group' channels
5. Mediapanel, number of users - real users (RU) indicator
6. EBITDA excluding in Q1'24 gain on the sale of shares in Muzo.fm Sp. z o.o. of PLN 10m

Television

• Revenue from advertising and sponsorship of TV Polsat Group in Q1'24 increased by 8.0% YoY, to PLN 307m, while the TV advertising market recorded a 9.0% increase.
• As a result, our share in the TV advertising and sponsorship market was 28.1% compared to 28.4% in Q1'23.
• We expect the TV advertising and sponsorship market to grow at a low single-digit rate in 2024.

Analyst and investor briefing Q1'24

7

Green energy segment

		Q1'24			Q1'23		YoY
					change
Total electricity generation (GWh), of which:	198.9		149.3	33.2%
Biomass	135.1		140.0	-3.5%
Photovoltaics	11.9		9.3	28.0%
On-shore wind farms	51.9		-		N/A
Average price of sales of energy produced1) [PLN/MWh]	650.8		-	-
FINANCIAL RESULTS [PLNm]
Revenue, of which:	354			N/A		N/A
sale of own electricity	129
energy resale	173			N/A		N/A
EBITDA	47			N/A	-
CAPEX	87			N/A	-

1 Calculated as the ratio of the green energy segment's generated revenue from the sale of own electricity and the volume of production

Energy production

• Total volume of electricity produced was 198.9 GWh, incl.:
• • 135.1 GWh from biomass,
  • 11.9 GWh from photovoltaics,
  • 51.9 GWh from wind farms (production lasted for an incomplete quarter).
• Average price of sales of energy produced was PLN 650.8/MWh in Q1'24.

Analyst and investor briefing Q1'24

8

APPENDIX

Financial results of the Polsat Plus Group's business segments

Q1'24		B2C and		Media: TV		Real	Green		Consolidation
	B2B					Total
[PLN million]			and online		estate	energy		adjustments
			services
Revenue	2,576	585		40		354		-150	3,405
	YoY change	-4%	3%		-10%		N/A	-	6%
Operating costs1)	1,948	485		35		307		341	3,116
	YoY change	-3%	2%		-10%		N/A	-	8%
	EBITDA adjusted excl.		634		91			0,3		47			-		772
	disposal of assets2)
	YoY change	-4%	-2%		-96%		N/A	-	2%
EBITDA adjusted margin excl.	24.6%	15.5%		0.7%		13.4%		-	22.7%
disposal of assets 2)
	YoY change		-0.2pp		-0.8pp		-14.9pp	N/A	-	-1.1%
	EBITDA		798		101			0,3		47			-		946
	YoY change	20%	9%		-96%		N/A	-	24%
EBITDA margin	31.0%	17.2%		0.7%		13.4%		-	27.8%
	YoY change		6.2pp		1.0pp		-14.9pp	N/A	-		4.0pp
CAPEX	217	26		5	87		-	336

1. Costs excl. depreciation, amortization (incl. depreciation costs included in energy and buses production costs), impairment and liquidation
2. EBITDA excluding in Q1'24: gain on the sale of shares in Muzo.fm Sp. z o.o. of PLN 10 million and excluding proceeds from the disposal of the first part of the IPv4 address package for PLN 164 million net of transaction costs