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 Central European Media Enterprises Ltd. Reports Results for the Full Year and Fourth Quarter Ended December 31, 2017
   Thursday, February 08, 2018 1:53:00 AM ET

--- Net revenues increased 9% at actual rates and 6% at constant rates to US$ 574.2 million -

--- Operating income increased 23% at actual rates and 19% at constant rates to US$ 129.9 million -

--- OIBDA increased 21% at actual rates and 17% at constant rates to US$ 165.5 million -

--FOURTH QUARTER

--- Net revenues increased 15% at actual rates and 5% at constant rates to US$ 196.2 million -

--- Operating income increased 27% at actual rates and 16% at constant rates to US$ 57.8 million -

--- OIBDA increased 27% at actual rates and 15% at constant rates to US$ 67.6 million -

Central European Media Enterprises Ltd. ("CME" or the "Company") (NASDAQ/Prague Stock Exchange - CETV) today announced financial results for the full year and three months ended December 31, 2017.

Following the previously announced agreement to sell our Croatia and Slovenia operations, these businesses are classified as held for sale and presented as discontinued operations for all periods. The discussion in this release relates to our continuing operations in the four remaining operating segments.

Operational and financial highlights:

-- TV advertising revenues increased 8% at actual rates and 5% at constant rates in 2017.

-- Carriage fees and subscription revenues increased 17% at actual rates and 15% at constant rates.

-- OIBDA increased 21% at actual rates and 17% at constant rates, resulting in OIBDA margin expansion of nearly 300 basis points to 29%.

-- Operating income increased 23% at actual rates and 19% at constant rates.

-- Unlevered free cash flow in 2017 increased 19% at actual rates, while lower debt service obligations contributed to a 61% increase in net cash generated from continuing operations.

-- In 2018, we anticipate using increased cash generated by the business, proceeds from the sale of our operations in Croatia and Slovenia, expected proceeds from warrant exercises, and savings from lower debt service obligations to repay a significant balance of principal on our outstanding long-term debt. Taken together, these actions would result in a net leverage ratio around 3x by the end of the year.

-- Upon closing of the sale transaction and repayment of debt, we expect our average borrowing cost to be 4.5%.

Michael Del Nin, co-Chief Executive Officer, commented: "Our 2017 results represent our fourth straight year of both uninterrupted margin expansion and actual OIBDA growth above 20%. We anticipate that revenue growth, combined with our ongoing focus on cost containment, will drive another year of robust growth in profitability and continued margin expansion in 2018. Together with lower debt and reduced borrowing costs, this sets us up for a process of accelerated deleveraging that we think will characterize the year ahead."

Christoph Mainusch, co-Chief Executive Officer, added: "2017 was another outstanding year for CME and the positioning of our operations sets us up for additional success in 2018. We increased our audience share in three out of four countries, driving the gap between us and our closest commercial competition wider, both in prime time and all day. We also made important progress in diversifying our revenues. We expect to continue building on these successes, as we invest and innovate to remain the best partner for advertisers in our countries."

In this release we refer to several non-GAAP financial measures, including OIBDA, OIBDA margin, free cash flow, unlevered free cash flow and constant currency percentage movements. Please see "Non-GAAP Financial Measures" below for additional information, including definitions and reconciliations to US GAAP financial measures.

Consolidated results for the years ended December 31, 2017 and 2016 were:

                                                                      
                                                                                                                              ----------------------------------------------------------------------------------------------------------------------
                                                                                                                                                                                      RESULTS
                                                                                                                              ----------------------------------------------------------------------------------------------------------------------
(US$ 000’s, except per share data)                                                                                                                                        For the Year Ended December 31,
                                                                                                                              ----------------------------------------------------------------------------------------------------------------------
                                                                                                                                     2017           2016   % Actual              % Lfl (1)
                                                                                                                              -------------------------------- -------------                     -------- -------------------- --------------------
Net revenues                                                                                                                    $ 574,212      $ 526,174                          9.1%                   5.5%
Operating income                                                                                                                  129,949                           105,532                         23.1%                                     18.8%
Operating margin                                                                                                                    22.6%                             20.1%                      2.5 p.p.                                  2.5 p.p.
OIBDA                                                                                                                             165,532                           136,908                         20.9%                                     16.5%
OIBDA margin                                                                                                                        28.8%                             26.0%                      2.8 p.p.                                  2.7 p.p.
Income / (loss) from continuing operations                                                                                         54,053                         (164,425)                        NM (2)                                    NM (2)
Income / (loss) from continuing operations per share - basic                                                                         0.17                            (1.18)                        NM (2)                                    NM (2)
Income / (loss) from continuing operations per share - diluted                                                                  $    0.15                         $  (1.18)                        NM (2)                                    NM (2)
                                                                                                                                                                                                                                

Consolidated results for the three months ended December 31, 2017 and 2016 were:

                                                             
                                                                                                                     ------------------------------------------------------------------------------------------------------------
                                                                                                                                                                        RESULTS
                                                                                                                     ------------------------------------------------------------------------------------------------------------
(US$ 000’s, except per share data)                                                                                                                      For the Three Months Ended December 31,
                                                                                                                     ------------------------------------------------------------------------------------------------------------
                                                                                                                             2017           2016   % Actual   % Lfl (1)
                                                                                                                     --------------------------------- -------------                     -------- -------------------- ---------
Net revenues                                                                                                            $ 196,154      $ 170,027                         15.4%        4.6%
Operating income                                                                                                           57,750                            45,461                         27.0%                          15.7%
Operating margin                                                                                                            29.4%                             26.7%                      2.7 p.p.                       2.8 p.p.
OIBDA                                                                                                                      67,639                            53,456                         26.5%                          14.8%
OIBDA margin                                                                                                                34.5%                             31.4%                      3.1 p.p.                       3.1 p.p.
Income from continuing operations                                                                                          36,715                            21,370                         71.8%                          52.8%
Income from continuing operations per share - basic                                                                          0.13                              0.07                         85.7%                          62.5%
Income from continuing operations per share - diluted                                                                   $    0.10                         $    0.06                         66.7%                          63.2%
(1)% Lfl (like-for-like) variance reflects the impact
of applying the current period average exchange rates to the prior
period revenues and costs.
(2) Number is not meaningful.
 

Teleconference and Audio Webcast Details

CME will host a teleconference and audio webcast to discuss its full year and fourth quarter results on Thursday, February 8, 2018 at 9:00 a.m. New York time (2:00 p.m. London time and 3:00 p.m. Prague time). The audio webcast and teleconference will refer to presentation slides which will be available on CME’s website at www.cme.net prior to the call.

To access the teleconference, U.S. and international callers may dial +1 646-828-8193 ten minutes prior to the start time and reference passcode 9973091. The conference call will be audio webcasted live via www.cme.net. It can be heard on iPads, iPhones and a range of devices supporting Android and Windows operating systems.

A digital audio replay will be available for two weeks following the call at www.cme.net.

Forward-Looking and Cautionary Statements

This press release contains forward-looking statements. For all forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy or are otherwise beyond our control and some of which might not even be anticipated. Forward-looking statements reflect our current views with respect to future events and because our business is subject to such risks and uncertainties, actual results, our strategic plan, our financial position, results of operations and cash flows could differ materially from those described in or contemplated by the forward-looking statements.

Important factors that contribute to such risks include, but are not limited to, those factors set forth under "Risk Factors" in CME’s Annual Report on Form 10-K for the period ended December 31, 2017 as well as the following: the effect of changes in global and regional economic conditions and the extent, timing and duration of the recovery in our markets; levels of television advertising spending and the rate of development of the advertising markets in the countries in which we operate; the extent to which our debt service obligations and covenants may restrict our business; our exposure to additional tax liabilities as well as liabilities resulting from regulatory or legal proceedings initiated against us; our ability to refinance our existing indebtedness; our success in continuing our initiatives to diversify and enhance our revenue streams; our ability to make cost-effective investments in our television businesses, including investments in programming; our ability to develop and acquire necessary programming and attract audiences; our ability to consummate the sale of our operations in Croatia and Slovenia; and changes in the political and regulatory environments where we operate and in the application of relevant laws and regulations.

The foregoing review of important factors should not be construed as exhaustive. For a more detailed description of these uncertainties and other factors, please see the "Risk Factors" and "Forward-looking Statements" sections in CME’s Annual Report on Form 10-K for the period ended December 31, 2017. We undertake no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise.

This press release should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2017, which was filed with the Securities and Exchange Commission on February 8, 2018.

We make available free of charge on our website at www.cme.net our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission. Please note that we may announce material information using SEC filings, press releases, public conference calls, webcasts and posts to our website, www.cme.net. In the future, we will continue to use these channels to communicate important information about CME and our operations. Information that we post on our website could be deemed material. Therefore, we encourage investors, the media, our customers and others interested in CME to review the information we post at www.cme.net.

CME is a media and entertainment company continuing to operate leading businesses in four Central and Eastern European markets with an aggregate population of more than 40 million people. CME’s continuing operations broadcast 26 television channels in Bulgaria (bTV, bTV Cinema, bTV Comedy, bTV Action, bTV Lady and Ring), the Czech Republic (Nova, Nova 2, Nova Cinema, Nova Sport 1, Nova Sport 2, Nova International, Nova Action and Nova Gold), Romania (PRO TV, PRO 2, PRO X, PRO GOLD, PRO CINEMA, PRO TV International, MTV Romania and PRO TV Chisinau) and the Slovak Republic (TV Markiza, Markiza International, Doma and Dajto). CME is traded on the NASDAQ Global Select Market and the Prague Stock Exchange under the ticker symbol "CETV".

For additional information, please visit www.cme.net.

                                                                       
                                                                                           CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
                                                                                       CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                                                                             (US$ 000’s, except per share data)
                                                                                                                                  
                                                                                                                                                                     For the Year Ended
                                                                                                                                                                        December 31,
                                                                                                                                 -------------------------------------------------------------------------------------------
                                                                                                                                                             2017                                   2016
                                                                                                                                 ---------------------------------                     -------------------------------------
Net revenues                                                                                                                         574,212                                                   526,174
Operating expenses:
 Content costs                                                                                                                       254,061                                                   238,063
 Other operating costs                                                                                                                49,864                                                    54,949
 Depreciation of property, plant and equipment                                                                                        26,991                                                    23,106
 Amortization of broadcast licenses and other intangibles                                                                              8,592                                  8,270  
                                                                                                                                 --------------------------------                      ------------------------------------
Cost of revenues                                                                                                                     339,508                                                   324,388
 Selling, general and administrative expenses                                                                                        104,755                                 96,254  
                                                                                                                                 --------------------------------                      ------------------------------------
Operating income                                                                                                                     129,949                                                   105,532
 Interest expense                                                                                                                    (70,633 )                                                (111,389 )
 Loss on extinguishment of debt                                                                                                         (101 )                                                (150,158 )
 Non-operating income / (expense), net                                                                                                16,321                                 (2,074 )
                                                                                                                                 --------------------------------                      ------------------------------------
Income / (loss) before tax                                                                                                            75,536                                                  (158,089 )
 Provision for income taxes                                                                                                          (21,483 )                                                  (6,336 )
                                                                                                                                 --------------------------------                      ------------------------------------
Income / (loss) from continuing operations                                                                                            54,053                                                  (164,425 )
 Loss from discontinued operations, net of tax                                                                                        (4,626 )                                                 (16,172 )
                                                                                                                                 --------------------------------                      ------------------------------------
Net income / (loss)                                                                                                                   49,427                                                  (180,597 )
 Net loss attributable to noncontrolling interests                                                                                       341                                    306  
                                                                                                                                 --------------------------------                      ------------------------------------
Net income / (loss) attributable to CME Ltd.                                                                                        $ 49,768                             $ (180,291 )
                                                                                                                                 ==== ====== ====================                      ====== ======== ====================
                                                                                                                                                                                        
PER SHARE DATA:
Net income / (loss) per share:
 Continuing operations -- basic                                                                                         $   0.17                                                $    (1.18 )
 Continuing operations -- diluted                                                                                           0.15                                                     (1.18 )
 Discontinued operations -- basic                                                                                          (0.03 )                                                   (0.10 )
 Discontinued operations -- diluted                                                                                        (0.03 )                                                   (0.10 )
 Net income / (loss) attributable to CME Ltd. per share - basic                                                                         0.14                                                     (1.28 )
                                                                                                                                    $   0.12                                                $    (1.28 )
 Net income / (loss) attributable to CME Ltd. per share - diluted
                                                                                                                                                                                        
Weighted average common shares used in computing per share
amounts (000’s):
 Basic                                                                                                                               155,846                                                   151,017
 Diluted                                                                                                                             236,404                                                   151,017
                                                                                                                                                                                                        
                                                                
                                                                                      CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
                                                                                  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                                                                        (US$ 000’s, except per share data)
                                                                                                    (unaudited)
                                                                                                                                                                                               
                                                                                                                                                         For the Three Months Ended
                                                                                                                                                                December 31,
                                                                                                                          -----------------------------------------------------------------------------------------
                                                                                                                                  2017             2016  
                                                                                                                          ---------------------------------                      ---------------------------------
Net revenues                                                                                                                 $ 196,154                                              $ 170,027
Operating expenses:
 Content costs                                                                                                                  79,847                                                 71,125
 Other operating costs                                                                                                          14,117                                                 14,176
 Depreciation of property, plant and equipment                                                                                   7,646                                                  5,972
 Amortization of broadcast licenses and other intangibles                                                                        2,243                               2,023  
                                                                                                                          ---------------------------------                      ---------------------------------
Cost of revenues                                                                                                               103,853                                                 93,296
 Selling, general and administrative expenses                                                                                   34,551                              31,270  
                                                                                                                          ---------------------------------                      ---------------------------------
Operating income                                                                                                                57,750                                                 45,461
 Interest expense                                                                                                              (15,860 )                                              (20,749 )
 Non-operating income / (expense), net                                                                                           3,538                              (3,712 )
                                                                                                                          ---------------------------------                      ---------------------------------
Income before tax                                                                                                               45,428                                                 21,000
 (Provision) / Credit for income taxes                                                                                          (8,713 )                                                  370  
                                                                                                                          ---------------------------------                      ---------------------------------
Income from continuing operations                                                                                               36,715                                                 21,370
 Income / (loss) from discontinued operations, net of tax                                                                        4,121                                (201 )
                                                                                                                          ---------------------------------                      ---------------------------------
Net income                                                                                                                      40,836                                                 21,169
 Income attributable to noncontrolling interests                                                                                  (193 )                                                  (81 )
                                                                                                                          ---------------------------------                      ---------------------------------
Net income attributable to CME Ltd.                                                                                          $  40,643                           $  21,088  
                                                                                                                          ==== ======= ====================                      ==== ======= ====================
                                                                                                                                                                                               
PER SHARE DATA:
Net income per share:
 Continuing operations -- basic                                                                                  $    0.13                                              $    0.07
 Continuing operations -- diluted                                                                                     0.10                                                   0.06
 Discontinued operations -- basic                                                                                     0.02                                                   0.00
 Discontinued operations -- diluted                                                                                   0.01                                                   0.00
 Net income attributable to CME Ltd. per share - basic                                                                            0.15                                                   0.07
 Net income attributable to CME Ltd. per share - diluted                                                                     $    0.11                                              $    0.06
                                                                                                                                                                                               
Weighted average common shares used in computing per share
amounts (000’s):
 Basic                                                                                                                         156,637                                                154,349
 Diluted                                                                                                                       241,680                                                219,450
                                                                                                                    
                                                                                                CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
                                                                                                 CONDENSED CONSOLIDATED BALANCE SHEETS
                                                                                                              (US$ 000’s)
                                                                                                                                                                                                  
                                                                                                                                                          December 31, 2017                                          December 31, 2016
                                                                                                                                     ---------------------------------------                     --------------------------------------
ASSETS
 Cash and cash equivalents                                                                                                                 $    54,903                                                $    40,606
 Other current assets                                                                                                                          261,715                                                    238,574
 Current assets held for sale                                                                                                                  148,156                                  61,240  
                                                                                                                                     --------------------------------------                      -------------------------------------
Total current assets                                                                                                                           464,774                                                    340,420
 Property, plant and equipment, net                                                                                                            103,648                                                     89,080
 Goodwill and other intangible assets, net                                                                                                   1,042,764                                                    879,668
 Other non-current assets                                                                                                                       16,869                                                     21,273
 Non-current assets held for sale                                                                                                       --                                  60,276  
                                                                                                                                     --------------------------------------                      -------------------------------------
Total assets                                                                                                                               $ 1,628,055                             $ 1,390,717  
                                                                                                                                     ======= ========= ====================                      ====== ========= ====================
                                                                                                                                                                                                  
LIABILITIES AND EQUITY
 Accounts payable and accrued liabilities                                                                                                  $   143,893                                                $   134,378
 Current portion of long-term debt and other financing arrangements                                                                              2,960                                                      1,228
 Other current liabilities                                                                                                                       9,280                                                      8,467
 Current liabilities held for sale                                                                                                              32,131                                  27,491  
                                                                                                                                     --------------------------------------                      -------------------------------------
Total current liabilities                                                                                                                      188,264                                                    171,564
 Long-term portion of long-term debt and other financing arrangements                                                                        1,085,714                                                  1,001,408
 Other non-current liabilities                                                                                                                  95,254                                                     67,963
 Non-current liabilities held for sale                                                                                                  --                                   1,415  
                                                                                                                                     --------------------------------------                      -------------------------------------
Total liabilities                                                                                                                          $ 1,369,232                             $ 1,242,350  
                                                                                                                                     ------- --------- --------------------                      ------ --------- --------------------
                                                                                                                                                                                                  
Series B Convertible Redeemable Preferred Stock                                                                                                264,593                                                    254,899
                                                                                                                                                                                                  
EQUITY
 Common Stock                                                                                                                                   11,639                                                     11,476
 Additional paid-in capital                                                                                                                  1,905,779                                                  1,910,244
 Accumulated deficit                                                                                                                        (1,735,768 )                                               (1,785,536 )
 Accumulated other comprehensive loss                                                                                                         (187,438 )                                                 (243,988 )
                                                                                                                                     --------------------------------------                      -------------------------------------
Total CME Ltd. shareholders’ deficit                                                                                                            (5,788 )                                                 (107,804 )
 Noncontrolling interests                                                                                                                           18                                   1,272  
                                                                                                                                     --------------------------------------                      -------------------------------------
Total deficit                                                                                                                              $    (5,770 )                                              $  (106,532 )
                                                                                                                                     ------- --------- --------------------                      ------ --------- --------------------
Total liabilities and equity                                                                                                               $ 1,628,055                             $ 1,390,717  
                                                                                                                                     ======= ========= ====================                      ====== ========= ====================
                                                                         
                                                                                                CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
                                                                                            CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                                                              (US$ 000’s)
                                                                                                                                                                            
                                                                                                                                   --------------------------------------------------------------------------------------------------
                                                                                                                                                                           For the Year Ended
                                                                                                                                                                              December 31,
                                                                                                                                   ---------------------------------------------------------------------------------------------------
                                                                                                                                                    2017              2016  
                                                                                                                                   ------------------------------------------                      ----------------------------------
Net cash generated from continuing operating activities                                                                                           95,321                                                  59,387
Net cash used in continuing investing activities                                                                                                 (24,742 )                                               (22,201 )
Net cash used in continuing financing activities                                                                                                 (58,154 )                                               (22,472 )
Net cash used in discontinued operations                                                                                                          (8,573 )                                               (32,108 )
Impact of exchange rate fluctuations on cash and cash equivalents                                                                                 10,445                               (1,120 )
                                                                                                                                   ------------------------------------------                      ----------------------------------
Net increase / (decrease) in cash and cash equivalents                                                                                      $     14,297                            $ (18,514 )
                                                                                                                                   ========== ========== ====================                      ===== ======= ====================
                                                                                                                                                                                                                  
Supplemental disclosure of cash flow information for continuing
operations:
Cash paid for interest (includes mandatory cash-pay guarantee fees)                                                                         $     40,619                                               $  50,611
Cash paid for guarantee fees that may be paid in kind                                                                                              1,735                                                   7,464
Cash paid for income taxes, net of refunds                                                                                                  $     14,839                                               $     290
                                                                                                                                                                                                                  
Supplemental disclosure of non-cash items for continuing
operations:
Interest and related guarantee fees paid in kind                                                                                            $     23,137                                               $  36,491
Accretion on Series B Convertible Redeemable Preferred Stock                                                                                $      9,694                                               $  13,701
                                                                                                                                                                                                                  

Segment Data

We manage our business on a geographical basis, with four reporting segments: Bulgaria, the Czech Republic, Romania and the Slovak Republic. These segments reflect how CME Ltd.’s operating performance is evaluated by our chief operating decision makers, who we have identified as our co-Chief Executive Officers, how operations are managed by segment managers, and the structure of our internal financial reporting.

We evaluate our consolidated results and the performance of our segments based on net revenues and OIBDA. Stock-based compensation and certain other items are not allocated to our segments for purposes of evaluating their performance and therefore are not included in their respective OIBDA. Intersegment revenues and profits have been eliminated in consolidation.

Below are tables showing our net revenues and OIBDA by segment for the three and twelve months ended December 31, 2017 and 2016:

                             
                                                                                     --------------------------------------------------------------------------------------------------------
                                                                                                                          For the Year Ended December 31,
                                                                                     --------------------------------------------------------------------------------------------------------
(US $000’s)                                                                                 2017          2016     %Act                      %Lfl ( 1)
                                                                                     ------------                     ------------                     ------  ------------------------------
Net revenues
Bulgaria                                                                               $  77,341                        $  72,651                        6.5%                           3.7%
Czech Republic                                                                           209,041                          190,372                        9.8%                           3.5%
Romania                                                                                  191,244                          172,951                       10.6%                           9.5%
Slovak Republic                                                                           97,721                           90,549                        7.9%                           4.7%
Intersegment revenues                                                                    (1,135)                            (349)                      NM (2)                         NM (2)
                                                                                     ------------                     ------------                     ------  ------------------------------
Total net revenues                                                                     $ 574,212                        $ 526,174                        9.1%                           5.5%
                                                                                     === =======                      === =======                      ======  ==============================
                                                                                      
                                                                                     --------------------------------------------------------------------------------------------------------
                                                                                                                      For the Three Months Ended December 31,
                                                                                     --------------------------------------------------------------------------------------------------------
(US $000’s)                                                                                 2017                             2016                         %Act   %Lfl (1)
                                                                                     ------------                     ------------                     --------                     --------
Net revenues
Bulgaria                                                                               $  25,223                        $  22,548                        11.9%                          2.5%
Czech Republic                                                                            73,515                           61,814                        18.9%                          3.4%
Romania                                                                                   63,261                           54,682                        15.7%                          9.0%
Slovak Republic                                                                           34,373                           31,083                        10.6%                          1.3%
Intersegment revenues                                                                      (218)                            (100)                       NM (2)                        NM (2)
                                                                                     ------------                     ------------                     --------                     --------
Total net revenues                                                                     $ 196,154                        $ 170,027                        15.4%                          4.6%
                                                                                     === =======                      === =======                      ========                     ========
(1) % Lfl (like-for-like) variance reflects the impact of
applying the current period average exchange rates to the prior
period revenues and costs.
(2) Number is not meaningful.
 
                                
                                                                                        ----------------------------------------------------------------------------------------------------------
                                                                                                                              For the Year Ended December 31,
                                                                                        ----------------------------------------------------------------------------------------------------------
(US $000’s)                                                                                     2017           2016      %Act   %Lfl (1)
                                                                                        -------------                     -------------                     -------                      --------
OIBDA
Bulgaria                                                                                   $  16,841                         $  12,242                        37.6%                         34.9%
Czech Republic                                                                                83,600                            77,018                         8.5%                          1.3%
Romania                                                                                       74,435                            62,016                        20.0%                         19.7%
Slovak Republic                                                                               24,742                            15,947                        55.2%                         47.4%
Elimination                                                                                      (8)                                 5                       NM (2)                        NM (2)
                                                                                        -------------                     -------------                     -------                      --------
Total Operating Segments                                                                   $ 199,610                         $ 167,228                        19.4%                         14.9%
Corporate                                                                                   (34,078)                          (30,320)                      (12.4)%                        (7.5)%
                                                                                        -------------                     -------------                     -------                      --------
Total OIBDA                                                                                $ 165,532                         $ 136,908                        20.9%                         16.5%
                                                                                        ==== =======                      ==== =======                      =======                      ========
                                                                                         
                                                                                        ----------------------------------------------------------------------------------------------------------
                                                                                                                          For the Three Months Ended December 31,
                                                                                        ----------------------------------------------------------------------------------------------------------
(US $000’s)                                                                                     2017                              2016                         %Act                      %Lfl (1)
                                                                                        -------------                     -------------                     -------                      --------
OIBDA
Bulgaria                                                                                   $   9,868                         $   3,276                       201.2%                        178.3%
Czech Republic                                                                                34,470                            30,665                        12.4%                        (2.0)%
Romania                                                                                       21,985                            16,986                        29.4%                         23.3%
Slovak Republic                                                                               13,403                            10,779                        24.3%                         14.0%
Elimination                                                                                     (35)                               (4)                       NM (2)                        NM (2)
                                                                                        -------------                     -------------                     -------                      --------
Total Operating Segments                                                                   $  79,691                         $  61,702                        29.2%                         16.9%
Corporate                                                                                   (12,052)                           (8,246)                      (46.2)%                       (30.7)%
                                                                                        -------------                     -------------                     -------                      --------
Total OIBDA                                                                                $  67,639                         $  53,456                        26.5%                         14.8%
                                                                                        ==== =======                      ==== =======                      =======                      ========
(1) % Lfl (like-for-like) variance reflects the impact of
applying the current period average exchange rates to the prior
period revenues and costs.
(2) Number is not meaningful.
 

Non-GAAP Financial Measures

In this release we refer to several non-GAAP financial measures, including OIBDA, OIBDA margin, free cash flow and unlevered free cash flow. We believe that each of these metrics is useful to investors for the reasons outlined below. Non-GAAP financial measures may not be comparable to similar measures reported by other companies. Non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, US GAAP financial measures.

We evaluate our consolidated results and the performance of our segments based on net revenues and OIBDA. We believe OIBDA is useful to investors because it provides a meaningful representation of our performance, as it excludes certain items that do not impact either our cash flows or the operating results of our operations. OIBDA and unlevered free cash flow are also used as components in determining management bonuses.

OIBDA includes amortization and impairment of program rights and is calculated as operating income / loss before depreciation, amortization of intangible assets and impairments of assets and certain unusual or infrequent items that are not considered by our co-Chief Executive Officers when evaluating our performance. Stock-based compensation and certain other items are not allocated to our segments for purposes of evaluating their performance and therefore are not included in their respective OIBDA. Our key performance measure of the efficiency of our consolidated operations and our segments is OIBDA margin. We define OIBDA margin as the ratio of OIBDA to net revenues.

Following a repricing of our Guarantee Fees in March 2017, the proportion of interest and related Guarantee Fees on our outstanding indebtedness that must be paid in cash has increased. In addition to this obligation to pay more Guarantee Fees in cash, we expect to use cash generated by the business to pay certain Guarantee Fees that are payable in kind. These cash payments are all reflected in free cash flow; accordingly we believe unlevered free cash flow, defined as free cash flow before cash payments for interest and Guarantee Fees, best illustrates the cash generated by our operations when comparing periods. We define free cash flow as net cash generated from continuing operating activities less purchases of property, plant and equipment, net of disposals of property, plant and equipment and excluding the cash impact of certain unusual or infrequent items that are not included in costs charged in arriving at OIBDA because they are not considered by our co-Chief Executive Officers when evaluating performance.

For additional information regarding our business segments, see Part II, Item 8, Note 20, "Segment Data" in our Form 10-K.

While our reporting currency is the dollar, our consolidated revenues and costs are divided across a range of European currencies and CME Ltd.’s functional currency is the Euro. Given the significant movement of the currencies in the markets in which we operate against the dollar, we believe that it is useful to provide percentage movements based on actual ("% Act") percentage movements, which includes the effect of foreign exchange, as well as like-for-like percentage movements ("% Lfl"). The like-for-like percentage movement references reflect the impact of applying the current period average exchange rates to the prior period revenues and costs. Since the difference between like-for-like and actual percentage movements is solely the impact of movements in foreign exchange rates, our discussion in this release includes constant currency percentage movements in order to highlight those factors influencing operational performance. The incremental impact of foreign exchange rates is presented in the tables accompanying such analysis.

                                                                                                    
                                                                                                             --------------------------------------------------------------------------------------------------                      -------------------------------------------------------------------------------------------
                                                                                                                                              For the Year                                                                                           For the Three Months
(US $000’s)                                                                                                                                Ended December 31,                                                                                         Ended December 31,
                                                                                                             --------------------------------------------------------------------------------------------------                      -------------------------------------------------------------------------------------------
(unaudited)                                                                                                                   2017              2016                                         2017                           2016
                                                                                                             ------------------------------------------ -------------------- ----------------------------------                      ------------------------------------------ -------------------- ---------------------------
Operating income                                                                                                      $    129,949         $ 105,532                                                    $     57,750         $               45,461
Depreciation of property, plant and equipment                                                                               26,991                                                  23,106                                                           7,646                                                                5,972
Amortization of intangible assets                                                                                            8,592                                8,270                                        2,243                                             2,023
                                                                                                             ------------------------------------------                      ----------------------------------                      ------------------------------------------                      ---------------------------
Total OIBDA                                                                                                           $    165,532                            $ 136,908                                 $     67,639                            $               53,456
                                                                                                             ========== ========== ====================                      ===== ======= ====================                      ========== ========== ====================                      ===== ====================
                                                                                                                                                                                                                                                                                                            
                                                                                                                  
                                                                                                                                   -------------------------------------------------------------------------------------------------
                                                                                                                                                                     For the Year Ended December 31,
                                                                                                                                   --------------------------------------------------------------------------------------------------
                                                                                                                                                    2017             2016  
                                                                                                                                   ------------------------------------------                      ---------------------------------
Net cash generated from continuing operating activities                                                                                     $     95,321                                               $ 59,387
Capital expenditure, net of proceeds from disposals                                                                                              (24,742 )                                              (22,201 )
                                                                                                                                   ------------------------------------------                      ---------------------------------
Free cash flow                                                                                                                                    70,579                                                 37,186
Cash paid for interest (includes mandatory cash-pay guarantee fees)                                                                               40,619                                                 50,611
Cash paid for guarantee fees that may be paid in kind                                                                                              1,735                               7,464  
                                                                                                                                   ------------------------------------------                      ---------------------------------
Unlevered free cash flow from continuing operations                                                                                         $    112,933                            $ 95,261  
                                                                                                                                   ========== ========== ====================                      ===== ====== ====================

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20180207006432r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20180207006432/en/

SOURCE: Central European Media Enterprises Ltd.

Central European Media Enterprises 
Mark Kobal, +420 242 465 576 
Head of Investor Relations 
mark.kobal@cme.net


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