ProSiebenSat.1 Media SE Annual Report 2018

ENTERTAINMENT

Entertainment is and always will be our core business: Our passion for entertaining people has made ProSiebenSat.1 one of Europe’s most successful media companies. Now our task is to align the Entertainment business even more closely with viewers’ needs, which will help set us apart from the competition. Specifically, our focus is on local and digital content, live shows, sports and news, which we distribute on as many channels as possible in order to maximize our total reach. To make this possible, we are increasing investments in digital platforms for the 360-degree availability of our offerings. The next step involves making total reach addressable and easier to monetize by providing advertising that is optimally tailored to each viewer. That is why a major focus of our investments in the Entertainment pillar is data and advertising technology.

CONTENT PRODUCTION & GLOBAL SALES

The Content Production & Global Sales pillar comprises our production and distribution network Red Arrow Studios and our digital studio network Studio71. Red Arrow Studios produces successful content for ProSiebenSat.1 channels as well as for third-party providers. Going forward, we aim to harness even more of Red Arrow’s strengths for our own entertainment platforms: The percentage of Red Arrow productions on our own channels is to grow significantly in the coming years. Red Arrow’s international production network will continue its successful expansion, focusing on the US and UK core markets. In the digital video business, we want to build Studio71 into a leading provider with content chiefly targeting young digital natives.

COMMERCE

ProSiebenSat.1’s successful Commerce activities are bundled in the NuCom Group. NuCom Group’s goal is to grow the leading market position of each of its portfolio companies. In pursuit of that, we are targeting four strong consumer needs: consumer advice, matchmaking services, experience and gift vouchers, and beauty and lifestyle. ProSiebenSat.1 is banking on both organic growth and complementary selective acquisitions to further accelerate NuCom Group's dynamic growth. At the same time, the NuCom Group and the ProSiebenSat.1 Entertainment business are increasingly leveraging their mutual synergies, especially in terms of data, technology and brand building. In 2018, we also entered into a partnership with the growth investor General Atlantic, whose tasks include helping NuCom further step up the operating performance of the Commerce companies.

In every business area, we are taking the right steps to keep driving ProSiebenSat.1’s transformation forward as well as to strengthen our position as Europe’s leading entertainment and commerce company. As we pursue a strategy that revolves around creating synergies and meeting our viewers’ and customers’ needs, our mid-term target is to increase revenues from EUR 4 billion to EUR 6 billion and adjusted EBITDA from EUR 1 million to EUR 1.5 million. In around five years’ time, 50 percent of our revenues should come from digital.