Central European Media Enterprises Reports Third Quarter 2007 Results

Central European Media Enterprises Reports Third Quarter 2007 Results

THIRD QUARTER - Net Revenues Increase 55% - - Operating Income Grows $28.4 million to $35.0 million - - Segment(1) EBITDA Increases 147% -

NINE MONTHS - Net Revenues Increase 39% - - Operating Income Grows $54.0 million to $120.8 million - - Segment(1) EBITDA Increases 57% -

HAMILTON, Bermuda, Nov. 1 /PRNewswire-FirstCall/ -- Central European Media Enterprises Ltd. (CME) (Nasdaq/Prague Stock Exchange: CETV) today announced financial results for the quarter and nine months ended September 30, 2007.

Net revenues for the third quarter of 2007 increased 55% to $174.8 million, compared to the third quarter of 2006. Operating income for the quarter increased $28.4 million to $35.0 million. Net income from continuing operations decreased $25.0 million to a loss of $(18.8) million, and fully diluted earnings per share in respect of continuing operations for the quarter decreased to a loss of $(0.45) from $0.15. Segment(1) EBITDA for the quarter increased 147% to $64.2 million, compared to the third quarter of 2006.

Net revenues for the nine months ended September 30, 2007 increased 39% to $539.0 million, compared to the nine months ended September 30, 2006. Operating income increased $54.0 million to $120.8 million. Net income from continuing operations increased $16.5 million to $15.6 million, and fully diluted earnings per share in respect of continuing operations increased to $0.37 from a loss of $(0.02). Our consolidated results for the nine months ended September 30, 2007 include Markiza in the Slovak Republic, which was not consolidated until January 23, 2006. Segment(1) EBITDA for the nine months ended September 30, 2007 increased 57% to $191.1 million, compared to the nine months ended September 30, 2006.

Michael Garin, Chief Executive Officer of CME, said "Our third quarter results highlight the continued strength of our operations across all markets. I am particularly pleased by the strong performance of our Ukrainian operations. We have recently increased our 2007 guidance and look forward to continuing our position as the fastest growing multinational broadcaster."

Consolidated Results for the Three Months Ended September 30, 2007

Consolidated Net Revenues for the three months ended September 30, 2007 increased by 55% to $174.8 million from $112.5 million for the three months ended September 30, 2006. Operating income for the quarter was $35.0 million compared with $6.6 million for the three months ended September 30, 2006. Net loss for the quarter was $(18.8) million compared to net income of $3.9 million for the three months ended September 30, 2006. Fully diluted earnings per share for the three months ended September 30, 2007 was a loss of $(0.45), decreasing $0.54 compared to the three months ended September 30, 2006.

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

CONSOLIDATED RESULTS (Unaudited)
For the Three Months Ended September 30,
(US $000's)
2007 2006 $ change % change
Net Revenues $174,836 $112,482 $62,354 55 %
Operating income $34,950 $6,571 $28,379 432 %
Net (loss) / income from
continuing operations $(18,763) $6,267 $(25,030) (399)%
Net (loss) / income $(18,763) $3,934 $(22,697) (577)%
Fully diluted (loss) / $(0.45) $0.15 $(0.60) (400)%
earnings per share from
continuing operations
Fully diluted (loss) /
earnings per share $(0.45) $0.09 $(0.54) (600)%

Consolidated Results for the Nine Months Ended September 30, 2007

Consolidated Net Revenues for the nine months ended September 30, 2007 increased by 39% to $539.0 million from $388.8 million for the nine months ended September 30, 2006. Operating income for the period was $120.8 million compared with $66.8 million for the nine months ended September 30, 2006. Net income for the nine months ended September 30, 2007 was $15.6 million compared to a net loss of $(5.8) million for the nine months ended September 30, 2006. Fully diluted earnings per share for the nine months ended September 30, 2007 was $0.37, increasing $0.51 compared to the nine months ended September 30, 2006.

Headline Consolidated Results for the nine months ended September 30, 2007 and 2006 were:

CONSOLIDATED RESULTS (Unaudited)
For the Nine Months Ended September 30,
(US $000's)
2007 2006 $ change % change
Net Revenues $539,032 $388,825 $150,207 39 %
Operating income $120,785 $66,787 $53,998 81 %
Net income / (loss) from Nm %
continuing operations $15,577 $(945) $16,522
Net income / (loss) $15,577 $(5,808) $21,385 368 %
Fully diluted earnings / $0.37 $(0.02) $0.39 Nm %
(loss) per share from
continuing operations
Fully diluted earnings /
(loss) per share $0.37 $(0.14) $0.51 364 %

Nm% = Not meaningful

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 September 30, 2007

For the three months ended September 30, 2007, Total Segment(1) Net Revenues increased 55% to $174.8 million from $112.5 million for the three months ended September 30, 2006. Total Segment(1) EBITDA for the three months ended September 30, 2007 increased 147% to $64.2 million from $26.0 million for the three months ended September 30, 2006. Segment(1) EBITDA Margin for the three months ended September 30, 2007 was 37%, compared to 23% for the three months ended September 30, 2006.

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

SEGMENT (1) RESULTS (Unaudited)
For the Three Months Ended September 30,
(US $000's)
2007 2006 $ change % change
Segment Net Revenues -
Broadcast Operations $173,991 $111,931 $62,060 55 %
Segment Net Revenues -
Non-Broadcast Operations $845 $551 $294 53 %
Total Segment Net Revenues $174,836 $112,482 $62,354 55 %
Segment EBITDA - Broadcast
Operations $65,805 $26,119 $39,686 152 %
Segment EBITDA - Nm %
Non-Broadcast Operations $(1,653) $(111) $(1,542)
Total Segment EBITDA $64,152 $26,008 $38,144 147 %
Segment EBITDA Margin 37 % 23 %

Nm% = Not meaningful

Segment(1) Results for the Nine Months Ended September 30, 2007

For the nine months ended September 30, 2007, Total Segment(1) Net Revenues increased 38% to $539.0 million from $390.6 million for the nine months ended September 30, 2006. Total Segment(1) EBITDA for the nine months ended September 30, 2007 increased 57% to $191.1 million from $122.1 million for the nine months ended September 30, 2006. Segment(1) EBITDA Margin for the nine months ended September 30, 2007 was 35% compared to 31% for the nine months ended September 30, 2006.

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

SEGMENT (1) RESULTS (Unaudited)
For the Nine Months Ended September 30,
(US $000's)
2007 2006 $ change % change
Segment Net Revenues -
Broadcast Operations $536,964 $388,906 $148,052 38 %
Segment Net Revenues -
Non-Broadcast Operations $2,068 $1,680 $388 23 %
Total Segment Net Revenues $539,032 $390,586 $148,446 38 %
Segment EBITDA - Broadcast
Operations $193,538 $122,035 $71,503 59 %
Segment EBITDA -
Non-Broadcast Operations $(2,397) $44 $(2,441) Nm %
Total Segment EBITDA $191,141 $122,079 $69,062 57 %
Segment EBITDA Margin 35 % 31 %

Nm% = Not meaningful

The Company will host a teleconference to discuss its third quarter 2007 results on Thursday, November 1, 2007 at 11:00 a.m. EDT (3:00 p.m. GMT and 4:00 p.m. CET). The teleconference will refer to presentation slides which will be available on CME's website www.cetv-net.com prior to the call.

To access the teleconference, please dial +1 973-321-1024 (U.S. and international callers) ten minutes prior to the start time. The conference call will be broadcast live via www.cetv-net.com. A replay of the teleconference will be available for two weeks following the call and can be accessed by dialing +1 973-341-3080 (U.S. and international callers), passcode: 9388828. 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 press release contains forward-looking statements, including the impact of competitive market dynamics and the political environment in Ukraine, the impact of legal proceedings in Croatia, 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, regulatory, 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 Quarterly Report on Form 10-Q for the three months and nine months ended September 30, 2007, which was filed with the Securities and Exchange Commission on November 1, 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.

We make available, free of charge, on our website at http://www.cetv-net.com/ 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.

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".

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

For the Three Months Ended
September 30
2007 2006
Net revenues $174,836 $112,482
Operating costs 27,166 22,073
Cost of programming 65,909 47,920
Depreciation of station property, plant and
equipment 8,768 6,080
Amortization of broadcast licenses and other
intangibles 6,595 5,015
Cost of revenues 108,438 81,088
Station selling, general and administrative
expenses 17,609 16,481
Corporate operating costs (including non-cash
stock-based compensation of $ 1.5 million and
$ 1. million in the three months ended September 30,
2007 and 2006, respectively) 13,839 8,342
Operating income 34,950 6,571
Interest expense, net (10,703) (9,512)
Foreign currency exchange (loss) / gain, net (23,300) 6,018
Change in fair value of derivatives (8,555) (881)
Other expense (6,513) (412)
(Loss) / income before provision for income taxes,
minority interest, equity in income of
unconsolidated affiliates and discontinued
operations (14,121) 1,784
Provision for income taxes (131) (1,235)
(Loss) / income before minority interest, equity in
income of unconsolidated affiliates and
discontinued operations (14,252) 549
Minority interest in income of consolidated
subsidiaries (4,511) (461)
Gain on sale of unconsolidated affiliate - 6,179
Net (loss) / income from continuing operations (18,763) 6,267
Loss from discontinued operations - (2,333)
Net (loss) / income $(18,763) $3,934

PER SHARE DATA:
Net (loss) / income per share
Continuing operations - Basic $(0.45) $0.15
Continuing operations - Diluted $(0.45) $0.15
Discontinued operations - Basic $0.00 $(0.06)
Discontinued operations - Diluted $0.00 $(0.06)
Net income - Basic $(0.45) $0.09
Net income - Diluted $(0.45) $0.09

Weighted average common shares used in computing
per share amounts (000s):
Basic 41,489 40,651
Diluted 41,489 41,188

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

For the Nine Months
Ended
September 30
2007 2006
Net revenues $539,032 $388,825
Operating costs 83,767 71,087
Cost of programming 215,035 149,188
Depreciation of station property, plant and
equipment 23,347 17,841
Amortization of broadcast licenses and other
intangibles 16,922 13,967
Cost of revenues 339,071 252,083
Station selling, general and administrative
expenses 49,089 45,188
Corporate operating costs (including non-cash
stock-based compensation of $ 4.1 million and
$ 2.4 million in the nine months ended
September 30, 2007 and 2006, respectively) 30,087 24,019
Impairment loss - 748
Operating income 120,785 66,787
Interest expense, net (38,391) (28,173)
Foreign currency exchange loss, net (28,552) (25,469)
Change in fair value of derivative 3,497 (2,757)
Other expense (13,272) (793)
Income before provision for income taxes, minority
interest, equity in income of
unconsolidated affiliates and discontinued
operations 44,067 9,595
Provision for income taxes (18,609) (8,811)
Income before minority interest, equity in income
of unconsolidated affiliates and
discontinued operations 25,458 784
Minority interest in income of consolidated
subsidiaries (9,881) (7,178)
Equity in loss of unconsolidated affiliates - (730)
Gain on sale of unconsolidated affiliate - 6,179
Net income / (loss) from continuing operations 15,577 (945)
Loss from discontinued operations - (4,863)
Net income / (loss) $15,577 $(5,808)

PER SHARE DATA:
Net income per share
Continuing operations - Basic $0.38 $(0.02)
Continuing operations - Diluted $0.37 $(0.02)
Discontinued operations - Basic $0.00 $(0.12)
Discontinued operations - Diluted $0.00 $(0.12)
Net income - Basic $0.38 $(0.14)
Net income - Diluted $0.37 $(0.14)

Weighted average common shares used in computing
per share amounts (000s):
Basic 41,077 39,792
Diluted 41,553 39,792

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 nine months ended September 30, 2007 and 2006:

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

SEGMENT FINANCIAL INFORMATION
For the Three Months Ended
September 30,
(US $000's)
Segment Net Segment EBITDA
Revenues (1)
2007 2006 2007 2006
Country
Croatia (NOVA TV)
$7,055 $4,288 $(2,981)$(4,558)
Czech Republic (TV NOVA) 51,140 40,141 25,989 17,234
Romania (2) 44,412 29,298 19,486 11,719
Slovak Republic (MARKIZA TV) 20,286 13,895 5,544 2,408
Slovenia (POP TV and KANAL A) 11,545 9,101 854 1,225
Ukraine (STUDIO 1+1) 39,582 15,578 16,599 (838)
Ukraine (KINO, CITI) 816 181 (1,339) (1,182)
Total Segment Data $174,836 $112,482 $64,152 $26,008

Reconciliation to Consolidated
Statement of Operations:
Consolidated Net Revenues / (Loss) /
income before provision
for income taxes, minority interest
and discontinued
operations $174,836 $112,482 $(14,121) $1,784
Corporate operating costs (including
non-cash stock based
compensation of $ 1.5 million and $
1.0 million for the three
months ended September 30, 2007 and
2006, respectively) - - 13,839 8,342
Depreciation of station assets - - 8,768 6,080
Amortization of broadcast licenses
and other intangibles - - 6,595 5,015
Interest expense, net - - 10,703 9,512
Foreign currency exchange loss /
(gain), net - - 23,300 (6,018)
Change in fair value of derivatives - - 8,555 881
Other expense - - 6,513 412
Total Segment Data $174,836 $112,482 $64,152 $26,008

(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 Nine Months Ended
September 30,
(US $000's)
Segment Net
Revenues (1) Segment EBITDA
2007 2006 2007 2006
Country
Croatia (NOVA TV)
$24,701 $13,745 $(9,800) $(11,639)
Czech Republic (TV NOVA) 183,203 137,002 99,251 59,569
Romania (2) 135,978 96,938 57,152 39,756
Slovak Republic (MARKIZA TV) 68,615 45,147 23,012 9,258
Slovenia (POP TV and KANAL A) 44,309 34,883 12,243 10,688
Ukraine (STUDIO 1+1) 80,358 62,118 14,794 16,183
Ukraine (KINO, CITI) (3) 1,868 754 (5,511) (1,736)
Total Segment Data $539,032 $390,586 $191,141 $122,079

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 $539,032 $388,825 $44,067 $9,595
Corporate operating costs (including
non-cash stock based
compensation of $ 4.1 million and $
2.4 million for the nine
months ended September 30, 2007 and
2006, respectively) - - 30,087 24,019
Depreciation of station assets - - 23,347 17,841
Amortization of broadcast licenses
and other intangibles - - 16,922 13,967
Impairment charge - - - 748
Unconsolidated equity affiliates (4) - 1,761 - (1,283)
Interest expense, net - - 38,391 28,173
Foreign currency exchange loss, net - - 28,552 25,469
Change in fair value of derivatives - - (3,497) 2,757
Other expense - - 13,272 793
Total Segment Data $539,032 $390,586 $191,141 $122,079

(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.

First Call Analyst:
FCMN Contact:

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,
Kate Tellier or Mike Smargiassi, both of Brainerd Communicators, Inc.,
+1-212-986-6667, for Central European Media Enterprises

Web site:

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

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