Central European Media Enterprises Reports Second Quarter 2007 Results

Central European Media Enterprises Reports Second Quarter 2007 Results

SECOND QUARTER - Net Revenues Increase 38% - - Operating Income Grows $22.5 million to $66.6 million - - Segment EBITDA Increases 38% -

SIX MONTHS - Net Revenues Increase 32% - - Operating Income Grows $25.6 million to $85.8 million - - Segment EBITDA Increases 32% -

HAMILTON, Bermuda, Aug. 2 /PRNewswire-FirstCall/ -- Central European Media Enterprises Ltd. (CME) (Nasdaq/Prague Stock Exchange: CETV) today announced financial results for the quarter and half-year ended June 30, 2007.

Net revenues for the second quarter of 2007 increased 38% to $216.3 million, compared to the second quarter of 2006. Operating income for the quarter increased $22.5 million to $66.6 million. Net income from continuing operations increased $27.3 million to $34.6 million, and fully diluted earnings per share in respect of continuing operations increased to $0.83 from $0.18 for the quarter. Segment(1) EBITDA for the quarter increased 38% to $86.9 million, compared to the second quarter of 2006.

Net revenues for the six months ended June 30, 2007 increased 32% to $364.2 million, compared to the first half of 2006. Operating income for the first half increased $25.6 million to $85.8 million. Net income from continuing operations increased $41.6 million to $34.3 million, and fully diluted earnings per share in respect of continuing operations increased to $0.83 from a loss of $(0.18). Our consolidated results for the first half of 2007 include Markiza in the Slovak Republic, which was not consolidated until January 23, 2006. Segment(1) EBITDA for the six months ended June 30, 2007 increased 32% to $127.0 million, compared to the first half of 2006.

Michael Garin, Chief Executive Officer of CME, said "Five of our six markets continue to deliver record performances in the second quarter as shown by the 38% EBITDA increase over the same period last year. While we were disappointed with the EBITDA performance of Studio 1+1, we are convinced that in the next few years Ukraine will become the largest market in which we operate. We remain completely committed to Ukraine and will continue to aggressively but prudently pursue opportunities to further strengthen our presence there. The 2007 outlook for Ukraine is expected to remain uncertain until the outcome of the parliamentary elections, scheduled for September 30, is known. As a result, we are expanding our full year Segment(1) Net Revenues and Segment(1) EBITDA guidance without lowering the upper end of our ranges to reflect the current political and economic environment in Ukraine that may impact our 2007 results. This expanded guidance enables us to share with our investors our best current thinking about the year and underscores our commitment to keep investors well informed about both our prospects and challenges."

Consolidated Results for the Three Months Ended June 30, 2007

Consolidated Net Revenues for the three months ended June 30, 2007 increased by 38% to $216.3 million from $156.6 million for the three months ended June 30, 2006. Operating income for the quarter was $66.6 million compared with $44.0 million for the three months ended June 30, 2006. Net income for the quarter was $34.6 million compared to $8.5 million for the three months ended June 30, 2006. Fully diluted earnings per share for the three months ended June 30, 2007 was $0.83, increasing $0.62 compared to the three months ended June 30, 2006.

Headline Consolidated Results for the three months ended June 30, 2007 and 2006 were:

CONSOLIDATED RESULTS (Unaudited)
For the Three Months Ended June 30,
(US $000's)
2007 2006 $ change % change

Net Revenues $ 216,284 $ 156,589 $ 59,695 38%
Operating income $ 66,579 $ 44,033 $ 22,546 51%
Net income from
continuing operations $ 34,590 $ 7,245 $ 27,345 377%
Net income $ 34,590 $ 8,522 $ 26,068 306%
Fully diluted earnings
per share from
continuing operations $ 0.83 $ 0.18 $ 0.65 361%
Fully diluted earnings
per share $ 0.83 $ 0.21 $ 0.62 295%

Consolidated Results for the Six Months Ended June 30, 2007

Consolidated Net Revenues for the six months ended June 30, 2007 increased by 32% to $364.2 million from $276.3 million for the six months ended June 30, 2006. Operating income for the period was $85.8 million compared with $60.2 million for the six months ended June 30, 2006. Net income for the six months ended June 30, 2007 was $34.3 million compared to a net loss of $9.7 million for the six months ended June 30, 2006. Fully diluted earnings per share for the six months ended June 30, 2007 was $0.83, increasing $1.08 compared to the six months ended June 30, 2006.

Headline Consolidated Results for the six months ended June 30, 2007 and 2006 were:

CONSOLIDATED RESULTS (Unaudited)
For the Six Months Ended June 30,
(US $000's)
2007 2006 $ change % change

Net Revenues $ 364,196 $ 276,343 $ 87,853 32%
Operating income $ 85,835 $ 60,216 $ 25,619 43%
Net income / (loss) from
continuing operations $ 34,340 $ (7,212) $ 41,552 576%
Net income / (loss) $ 34,340 $ (9,742) $ 44,082 452%
Fully diluted earnings/
(loss) per share from
continuing operations (1) $ 0.83 $ (0.18) $ 1.01 561%
Fully diluted earnings/
(loss) per share (1) $ 0.83 $ (0.25) $ 1.08 432%

Segment(1) Results

We evaluate the performance of our operations based on Segment(1) Net Revenues and EBITDA (earnings before interest, taxes, depreciation and amortization).

Segment(1) Results for the Three Months Ended June 30, 2007

For the three months ended June 30, 2007, Total Segment(1) Net Revenues increased 38% to $216.3 million from $156.6 million for the three months ended June 30, 2006. Total Segment(1) EBITDA for the three months ended June 30, 2007 increased 38% to $86.9 million from $63.2 million for the three months ended June 30, 2006. Segment(1) EBITDA Margin for the three months ended June 30, 2007 was 40%, in line with that reported in the three months ended June 30, 2006.

Our Total Segment(1) Net Revenues and Total Segment(1) EBITDA for the three months ended June 30, 2007 and 2006 were:

SEGMENT (1) RESULTS (Unaudited)
For the Three Months Ended June 30,
(US $000's)
2007 2006 $ change % change
Segment Net Revenues -
Broadcast Operations $ 214,987 $ 155,902 $ 59,085 38%
Segment Net Revenues -
Non-Broadcast
Operations 1,297 687 610 89%
Total Segment Net
Revenues $ 216,284 $ 156,589 $ 59,695 38%
Segment EBITDA -
Broadcast Operations $ 87,175 $ 62,970 $ 24,205 38%
Segment EBITDA -
Non-Broadcast Operations (307) 186 (493) Nm
Total Segment EBITDA $ 86,868 $ 63,156 $ 23,712 38%
Segment EBITDA Margin 40% 40%

Segment(1) Results for the Six Months Ended June 30, 2007

For the six months ended June 30, 2007, Total Segment(1) Net Revenues increased 31% to $364.2 million from $278.1 million for the six months ended June 30, 2006. Total Segment(1) EBITDA for the six months ended June 30, 2007 increased 32% to $127.0 million from $96.1 million for the six months ended June 30, 2006. Segment(1) EBITDA Margin for the six months ended June 30, 2007 was 35%, in line with that reported in the six months ended June 30, 2006.

Our Total Segment(1) Net Revenues and Total Segment(1) EBITDA for the six months ended June 30, 2007 and 2006 were:

SEGMENT (1) RESULTS (Unaudited)
For the Six Months Ended June 30,
(US $000's)
2007 2006 $ change % change
Segment Net Revenues -
Broadcast Operations $ 362,409 $ 276,975 $ 85,434 31%
Segment Net Revenues -
Non-Broadcast
Operations 1,787 1,129 658 58%
Total Segment Net
Revenues $ 364,196 $ 278,104 $ 86,092 31%
Segment EBITDA -
Broadcast Operations $ 127,889 $ 95,916 $ 31,973 33%
Segment EBITDA -
Non-Broadcast
Operations (900) 155 (1,055) Nm
Total Segment EBITDA $ 126,989 $ 96,071 $ 30,918 32%
Segment EBITDA Margin 35% 35%

Guidance for Full Year 2007

We expect our Broadcast Operations to deliver Segment(1) Net Revenues of between US$ 760.0 million and US$ 790.0 million and Segment(1) EBITDA of between US$ 280.0 million and US$ 306.0 million.

In addition, we expect to invest approximately $10.0 million in developing our Non-Broadcast Operations in 2007.

For 2007, Segment(1) Net Revenues are equal to US GAAP Net Revenues. We do not present a reconciliation of anticipated Segment(1) EBITDA for the year to December 31, 2007 to an equivalent US GAAP measure because we have a significant amount of debt that is denominated in Euros, and consequently our net earnings are subject to inherently unpredictable and potentially material foreign currency gains or losses.

The Company will host a teleconference to discuss its second quarter results on Thursday, August 2, 2007 at 10:00 a.m. New York time (3:00 p.m. London time and 4:00 p.m. Prague time). The teleconference will refer to presentation slides which will be available on CME's Web site www.cetv-net.com prior to the call.

To access the teleconference, please dial +1-973-582-2734 (U.S. and International callers) ten minutes prior to the start time. The conference call will be broadcast live via www.cetv-net.com. If you cannot listen to the teleconference at its scheduled time, there will be a replay available for two weeks following the call that can be accessed by dialing +1 973-341-3080 (U.S. and International callers), passcode: 9051446. A digital audio replay in mp3 format will also be archived on the Company's website.

(1) Segment Data, Segment Net Revenues and Segment EBITDA are all non US-
GAAP measures For further details, including a reconciliation to the
most directly comparable US-GAAP financial measures, see
'Reconciliation Between Consolidated Statements of Operations and
Segment Data (non US-GAAP)' below. We define Segment EBITDA margin as
Segment EBITDA expressed as a percentage of Segment Net Revenue.

Forward-Looking and Cautionary Statements

This report contains forward-looking statements, including expected revenue and EBITDA growth for 2007, the impact of competitive market dynamics and the political environment in Ukraine, the impact of legal proceedings in Croatia and Ukraine, the results of additional investment in Croatia and Ukraine, the implementation of an advertising sales strategy in the Czech Republic and cost reductions in the Czech and Slovak Republics, our ability to develop and implement multi-channel strategies generally, the growth of television advertising in our markets, the future economic conditions in our markets, future investments in television broadcast operations, the growth potential of advertising spending in our markets, and other business strategies and commitments. For these statements and all other 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. Future events and actual results, affecting our strategic plan as well as 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, the general regulatory environments where we operate and application of relevant laws and regulations, the renewals of broadcasting licenses, our ability to implement strategies regarding sales and multi- channel distribution, the rate of development of advertising markets in countries where we operate, our ability to acquire necessary programming and the ability to attract audiences, our ability to obtain additional frequencies and licenses, and general market and political and economic conditions in these countries as well as in the United States and Western Europe.

This press release should be read in conjunction with our Form 10-Q for the three months and six months ended June 30, 2007, which was filed with the Securities and Exchange Commission on August 2, 2007, and our Annual Report on Form 10-K for the year ended December 31, 2006, as amended by our Annual Report on Form 10-K/A which was filed with the Securities and Exchange Commission on April 30, 2007.

The Company makes available, free of charge, on our website at http://www.cetv-net.com/ our annual report 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.

CME is a TV broadcasting company operating leading networks in six Central and Eastern European countries with an aggregate population of approximately 90 million people. The Company's television stations are located in Croatia (Nova TV), Czech Republic (TV Nova, Galaxie Sport), Romania (PRO TV, Acasa, PRO Cinema, PRO TV International, Sport.ro), the Slovak Republic (Markiza), Slovenia (POP TV, Kanal A) and Ukraine (Studio 1+1, Studio 1+1 International, Kino, Citi). CME is traded on the NASDAQ and the Prague Stock Exchange under the ticker symbol "CETV".

For additional information, please visit www.cetv-net.com

CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(US$ 000's, except share and per share data)
(Unaudited)

For the Three Months Ended June 30
2007 2006

Net revenues $ 216,284 $ 156,589
Operating costs 30,944 26,042
Cost of programming 82,773 52,850
Depreciation of station property, plant
and equipment 7,680 6,059
Amortization of broadcast licenses and
other intangibles 5,165 4,620
Cost of revenues 126,562 89,571
Station selling, general and
administrative expenses 15,699 14,541
Corporate operating costs (including non-cash
stock-based compensation of $ 1.3 million
and $ 0.7 million in the three months
ended June 30, 2007 and 2006, respectively) 7,444 7,696
Impairment loss - 748
Operating income 66,579 44,033
Interest expense, net (17,706) (9,596)
Foreign currency exchange loss, net (2,116) (20,625)
Change in fair value of derivatives 7,528 (1,876)
Other (expense) / income (546) 167
Income before provision for income taxes,
minority interest, equity in income of
unconsolidated affiliates and
discontinued operations 53,739 12,103
Provision for income taxes (13,419) (3,582)
Income before minority interest,
equity in income of unconsolidated
affiliates and discontinued operations 40,320 8,521
Minority interest in income of
consolidated subsidiaries (5,730) (1,276)
Net income from continuing operations 34,590 7,245
Income from discontinued operations - 1,277
Net income $ 34,590 $ 8,522

PER SHARE DATA:
Net income per share
Continuing operations - Basic $ 0.84 $ 0.18
Continuing operations - Diluted $ 0.83 $ 0.18
Discontinued operations - Basic $ 0.00 $ 0.03
Discontinued operations - Diluted $ 0.00 $ 0.03
Net income - Basic $ 0.84 $ 0.21
Net income - Diluted $ 0.83 $ 0.21

Weighted average common shares used in
computing per share amounts (000s):
Basic 40,941 40,597
Diluted 41,407 41,186

CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(US$ 000's, except share and per share data)
(Unaudited)

For the Six Months Ended June 30,
2007 2006

Net revenues $ 364,196 $ 276,343
Operating costs 56,601 49,014
Cost of programming 149,126 101,268
Depreciation of station property,
plant and equipment 14,579 11,761
Amortization of broadcast licenses
and other intangibles 10,327 8,952
Cost of revenues 230,633 170,995
Station selling, general and
administrative expenses 31,480 28,707
Corporate operating costs (including non-cash
stock-based compensation of $ 2.6 million
and $ 1.7 million in the six months ended
June 30, 2007 and 2006, respectively) 16,248 15,677
Impairment loss - 748
Operating income 85,835 60,216
Interest expense, net (27,688) (18,661)
Foreign currency exchange loss, net (5,252) (31,487)
Change in fair value of derivative 12,052 (1,876)
Other expense (6,759) (381)
Income before provision for income taxes,
minority interest, equity in income of
unconsolidated affiliates and
discontinued operations 58,188 7,811
Provision for income taxes (18,478) (7,576)
Income before minority interest, equity
in income of unconsolidated affiliates
and discontinued operations 39,710 235
Minority interest in income of
consolidated subsidiaries (5,370) (6,717)
Equity in loss of unconsolidated affiliates - (730)
Net income / (loss) from continuing operations 34,340 (7,212)
Loss from discontinued operations - (2,530)
Net income / (loss) $ 34,340 $ (9,742)

PER SHARE DATA:
Net income per share
Continuing operations - Basic $ 0.84 $ (0.18)
Continuing operations - Diluted $ 0.83 $ (0.18)
Discontinued operations - Basic $ 0.00 $ (0.07)
Discontinued operations - Diluted $ 0.00 $ (0.07)
Net income - Basic $ 0.84 $ (0.25)
Net income - Diluted $ 0.83 $ (0.25)

Weighted average common shares used in
computing per share amounts (000s):
Basic 40,867 39,355
Diluted 41,390 39,355

Segment Data

We manage our business on a geographic basis, and review the performance of each geographic segment using data that reflects 100% of operating and license company results. Our segments are comprised of Croatia, the Czech Republic, Romania, the Slovak Republic, Slovenia and our two businesses in Ukraine.

We evaluate the performance of our segments based on Segment EBITDA. Segment Net Revenues and Segment EBITDA include the results of certain entities (primarily our operations in the Slovak Republic) that were not consolidated until January 23, 2006.

Segment EBITDA is determined as segment net income/loss, which includes costs for program rights amortization, before interest, taxes, depreciation and amortization of broadcast licenses and other intangible assets. Items that are not allocated to our segments for purposes of evaluating their performance, and therefore are not included in Segment EBITDA, include:

-- expenses presented as corporate expenses in our consolidated statements
of operations;
-- stock-based compensation charges;
-- foreign currency exchange gains and losses;
-- changes in fair value of derivatives; and
-- certain unusual or infrequent items (e.g., gains and losses/impairments
on assets or investments, gain on sale of unconsolidated affiliates).

We use Segment EBITDA as a component in determining management bonuses.

Below is a table showing our Segment EBITDA by operation and a reconciliation of these figures to our consolidated results for the three months and the six months ended June 30, 2007 and 2006:

Reconciliation Between Consolidated Statements of Operations
and Segment Data (non US-GAAP)

SEGMENT FINANCIAL INFORMATION
For the Three Months Ended June 30,
(US $000's)
Segment Net Revenues (1) Segment EBITDA
2007 2006 2007 2006
Country
Croatia (NOVA TV) $ 10,414 $ 5,647 $ (2,167) $ (2,639)
Czech Republic (TV NOVA) 80,544 56,312 47,595 29,509
Romania (2) 52,224 37,769 22,530 16,424
Slovak Republic
(MARKIZA TV) 29,652 20,046 11,712 7,827
Slovenia (POP TV
and KANAL A) 20,095 15,555 8,388 6,430
Ukraine (STUDIO 1+1) 22,701 21,062 565 6,037
Ukraine (KINO, CITI) 654 198 (1,755) (432)
Total Segment Data $216,284 $156,589 $ 86,868 $ 63,156

Reconciliation to
Consolidated Statement
of Operations:
Consolidated Net Revenues/
Income before provision
for income taxes, minority
interest and discontinued
operations $ 216,284 $ 156,589 $ 53,739 $ 12,103
Corporate operating costs
(including non-cash stock
based compensation of
$ 1.3 million and $ 0.7
million for the three months
ended June 30, 2007 and 2006,
respectively) - - 7,444 7,696
Depreciation of station assets - - 7,680 6,059
Amortization of broadcast
licenses and other
intangibles 5,165 4,620
Impairment charge - - - 748
Interest expense, net - - 17,706 9,596
Foreign currency exchange
loss, net - - 2,116 20,625
Change in fair value
of derivatives - - (7,528) 1,876
Other expense / (income) - - 546 (167)
Total Segment Data $ 216,284 $ 156,589 $ 86,868 $ 63,156

(1) All net revenues are derived from external customers. There are no
inter-segmental revenues.
(2) Romanian channels are PRO TV, PRO CINEMA, ACASA, PRO TV INTERNATIONAL
and SPORT.RO.

SEGMENT FINANCIAL INFORMATION
For the Six Months Ended June 30,
(US $000's)
Segment Net Revenues (1) Segment EBITDA
2007 2006 2007 2006
Country
Croatia (NOVA TV) $ 17,646 $ 9,457 $ (6,819) $ (7,081)
Czech Republic
(TV NOVA) 132,063 96,861 73,262 42,335
Romania (2) 91,566 67,640 37,666 28,037
Slovak Republic
(MARKIZA TV) 48,329 31,252 17,468 6,850
Slovenia (POP TV
and KANAL A) 32,764 25,782 11,389 9,463
Ukraine (STUDIO 1+1) 40,776 46,540 (1,805) 17,024
Ukraine (KINO, CITI) (3) 1,052 572 (4,172) (557)
Total Segment Data $ 364,196 $ 278,104 $ 126,989 $ 96,071

Reconciliation to
Consolidated Statement
of Operations:
Consolidated Net Revenues/
Income before provision
for income taxes, minority
interest, equity in income
of unconsolidated
affiliates and
discontinued operations $ 364,196 $ 276,343 $ 58,188 $ 7,811
Corporate operating costs
(including non-cash stock
based compensation of
$ 2.6 million and $ 1.5
million for the six months
ended June 30, 2007 and
2006, respectively) - - 16,248 15,677
Depreciation of station assets - - 14,579 11,761
Amortization of broadcast
licenses and other
intangibles 10,327 8,952
Impairment charge - - - 748
Unconsolidated equity
affiliates (4) - 1,761 - (1,283)
Interest expense, net - - 27,688 18,661
Foreign currency exchange
loss, net - - 5,252 31,487
Change in fair value
of derivatives - - (12,052) 1,876
Other expense - - 6,759 381
Total Segment Data $ 364,196 $ 278,104 $ 126,989 $ 96,071

(1) All net revenues are derived from external customers. There are no
inter-segmental revenues.
(2) Romanian channels are PRO TV, PRO CINEMA, ACASA, PRO TV INTERNATIONAL
and SPORT.RO.
(3) We acquired our Ukraine (KINO, CITI) operations in January 2006.
(4) Our Slovak Republic operations were accounted for as an equity
affiliate until January 23, 2006.

Source: Central European Media Enterprises Ltd.

CONTACT: Romana Tomasova, Director of Corporate Communications, Central
European Media Enterprises, +44 20 7430 5357, romana.tomasova@cme-net.com; or
Kate Tellier - Mike Smargiassi, both of Brainerd Communicators, Inc.,
+1-212-986-6667

Web site:

http://www.cetv-net.com/

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