2007 PRESS RELEASES

Press Release - Rome 04/10/07
Press Release - Rome 03/04/07
Press Release - Rome 14/02/07
Press Release - Rome 10/01/07

MONDO TV GROUP PRESS RELEASE: BoD approves pre-final results in the first 3 months 2007.

 B.o.D. approved the half-yearly report at 30 June 2007.

 Figures were also positive for the parent company:

Last Friday late at night the Board of Directors of Mondo TV S.p.A. - leading company of Mondo TV Group, which produces and distributes both cartoons for TV and cinema in Europe and films through the Mondo Home Entertainment Group - examined the half-yearly report at 30 June 2007.

Said period, extremely positive for the Group and its parent company Mondo TV S.p.A., showed significant growth in revenue and margins.

Consolidated results of first half of 2007

Half-year on half-year, consolidated revenue grew by 36%, nearly Euro 24 million compared to Euro 17.6 million in the first half of the previous year.

The good performance can be equally attributed to an increase in cartoons' TV exploitation by the parent company Mondo TV S.p.A. and as far as subsidiaries are concerned, to the growth in the film distribution carried out by Moviemax Italia Srl.

Consolidated EBITDA showed a significant growth (+126%) reaching Euro 6.8 million compared to Euro 3 million in the first half of 2006. The growth in percentage terms was from 17% of total 2006 revenues to 28% in the period under exhamination.

In spite of amortisations and depreciations for about Euro 7.3 million (up compared to Euro 5.3 million in 2006) and although Group EBIT still showed a slight loss of Euro 450 thousands, the result was much better if compared to the Euro 2.3 million loss approx. at the end of the half of the previous FY.

Consolidated net financial expenses amounted to Euro 334 thousand approx., basically in line with the same half of 2006 (Euro 311 thousands), and referred to the massive investments the Group made during the period.

Consolidated results after taxes and net of minority share, were positive for approx. Euro 0.95 million compared to the Euro 1.4 million loss in the first half of 2006.

Total net equity (referred to the Group and minorities) at 30 June 2007 reached Euro 40.8 million, up 2% approx. compared to Euro 40.0 million at 31 December 2006.

Concerning investments, in 2007 the parent company’s ordinary production activities continued, just like the acquisition activities performed by its subsidiaries. Library investments for the half amounted to about Euro 2.8 million compared to Euro 20.3 million approx. in the first half of 2006, although the latter period was affected by the acquisition of Moviemax Italia S.r.l. that led to a Euro 14.9 million increase in the library due to a change in the scope of consolidation.

At 30 June 2007 consolidated net financial position showed a Euro 17 million loss compared to - Euro 11.7 million at 31 December 2006. Net financial position includes payables to minority shareholders that were posted to consider put options granted for both Euro 4 million at 30/6/2007 and Euro 3.4 million at 31/12/2006.

Results of the parent company Mondo TV S.p.A.

In the first half of 2007 Mondo TV S.p.A. - the parent company - achieved revenue for approx. Euro 5.9 million, up 111% compared to Euro 2.8 million in the first half of 2006. Operating result reached Euro 325 thousand compared to the Euro 341 thousand loss of the first half of 2006.

Net profit reached Euro 2 million, considerably up compared to the Euro 349 thousand loss approx. in the same half of 2006.

According to the company, in the next months the marked growth of overall revenue will continue. Margin expectations for 2007 are confirmed.

In the light of the positive economic and business results in the first months of this FY, the company confirmed its ability to sell the library titles for approx. Euro 7 million for 2007, one of the best results ever achieved in recent years.

Significant events subsequent to the close of the half

The subsidiary Mondo TV France signed its first agreement with the company Alphanim (a leading company in France in the cartoons sector) regarding the animated series “The Questers”, a comedy of 52 episodes of 11 minutes each taking place in an original fantasy context, and addressed to an audience between 6 and 11 years old.

The budget provided for the production - expected to be finalized by Christmas 2008 - amounts to approx. Euro 7.4 million, i.e. the top level of the standard range; the co-producers will also realize a multiplayer interactive game connected to the series’ theme.

Rome, 1 October 2007

MONDO TV GROUP PRESS RELEASE: BoD approves pre-final results in the first 3 months 2007.

 Revenues deriving from Old Library at about 2 million Euro in the quarter.

Confirmed 2007 targets with revenues at about 10 million Euro (about twice than 2006), EBITDA at 5.9 million Euro (more than +300% on 2006) and EBIT positive at about 2 million Euro.

The Board of Directors of Mondo TV S.p.A. - parent company of the leading European group focused on TV and cinema cartoon creation, production and distribution - has examined, on Friday late evening, parent company’s pre final results in the first quarter 2007.

The company realized revenues for about 2.8 million Euro, a significant result if compared to the the entire 2006 fiscal year (5.1 million Euro).

Among this, about 2 million Euro are referred to the sales related to the old library, so that the company is confident to achieve the target for the entire 2007 in terms of old library sales (7.5 million Euro).

EBITDA has achieved 1,55 million Euro (more than the result for the entire 2006).

EBIT, again in the first quarter 2007, has been positive for about 800 thousands Euro (-1.6 million Euro in the entire 2006).

Thanks to the positive economic results the company realized in the first quarter of the current fiscal year, Mondo TV S.p.A. is confident to achieve the entire 2007 targets, already given to the market (14th February) and here are reminded:

Rome, 2nd April 2007

MONDO TV GROUP PRESS RELEASE: Resolutions of the Board of Directors

Mondo TV Group’s consolidated financial statements as at 31 December 2006:

Mondo TV SpA’s draft financial statements as at 31 December 2006:

Mondo TV S.p.A. 2007-2011 business plan (new accounting standard applied)

Approval of consolidated quarterly figures as at 31 December 2006, with consolidated revenues’ increase up to Euro 10.8 million (+103%) for the quarter. 

Mondo TV S.p.A., leading company in the group by the same name, produces and distributes cartoons for TV and cinema in Europe, and distributes home videos and films in Italy through the subsidiary Mondo Home Entertainment. Today the Board of Directors approved the following financial records:

Change in accounting standard for co-production and licensing contracts

In order to conform to standard international procedures followed by companies operating in the sector, and to better express the characteristics of transactions completed by the Group and contracts regulating these transactions, the directors decided to change the accounting standard adopted for previous financial statements. This mainly regards the handling of transacions with co-producers, signing of relative contracts, and partial sale of rights to the films co-produced.

According to the co-production contract used with some American and Korean companies this year and in the past, Mondo TV assigns the creation of the cartoon to the counterparty, under the direction of, and based on the ideas developed by Mondo TV. The work is done in exchange for payment in tranches depending on the timeframes established. Although this operation includes several phases, the structure of the agreement is such that it focuses on the final product, or rather, the complete movie.

The licensing contract (so-called pre-sale), drawn up while the co-production contract is being signed, allows Mondo TV to sell exclusive film rights to the counterparty, for a period of sixty years (option of renewal for sixty more free of charge), to be used in certain areas (in Asia and 50% of America and Oceania). More specifically, the contractual agreement provides for the granting of independent licensing rights to the counterparty, which go into effect upon completion of each individual phase planned for the production of the movie. The rights apply to the content produced and turned in at the end of each phase.

For licensing rights granted, the overall compensation is to be paid in tranches coinciding with the completion of individual phases of production. The terms of the contract generally include a financial settlement for the difference between the amounts charged by the co-producer for services rendered and the amounts charged by the Group for the sale of rights in permitted areas. Film rights for all other areas remain property of Mondo TV.

Other commercial agreements include terms of payment for the co-producer’s reimbursal of costs to Mondo TV, with regard to the budgets established at the end of different phases in production.

The relations described above are now included in the methodology known as “net accounting.” When the amount charged by the co-producer for services rendered exceeds the amount charged for the partial sale of film rights, the Group enters the difference as an intangible fixed asset. In the event that the amount charged by the producer is inferior, the difference is recorded as revenue for that fiscal year. In the case of contracts with stipulations on reimbursement, active billing cycles reflect the costs sustained. The amortization of intangible business is deferred until the company begins to make commercial use of the film (as indicated in the license agreement) and bring in profits from third-party users.

International accounting standards do not explicitly regulate this type of transaction. In compliance with IAS 8 p10, when there is no specific regulation provided, the directors must select an accounting standard that produces relevant financial information and reflects the economic aspect of the transaction. The directors have assessed the method of net accounting as being reliable and more accurate in expressing the effects of transactions, and more consistent with international procedures and other model accounting standards, such as the US GAAP and the information in section 12 of IAS 8.

For this reason, starting with the half-year report as at 30 June 2006, released in lieu of the previous report that had been retracted, the directors applied the new accounting standard to all commercial relations with co-producers which had characteristics similar to those described above and were completed before 2006. In compliance with section 22 of IAS 8, the Group applied the modified standard retroactivelly and adjusted the data for every corresponding period and the opening net equity as at 1 January 2005, in order to update the information as if the new standard had always been applied.

With regard to information included, the former accounting standard required the following for both types of contracts described above:

The adjustments resulting from the change in accounting standard for financial statements  (balance sheets, NFP, income sheets, and reports on variations) are shown in further detail in the tables  enclosed.

1. Half-yearly report as at 30 June 2006 (re-approved after change of accounting standard)

In light of the new accounting standard, the following section explains the differences in the main financial indicators included in the report from 6 June 2006, approved by the BOD today, with regard to data from the report approved on 26 September 2006.

The opportunity to draft a new document is the result of the BOD’s resolution to modify some of the criteria previously adopted for recording financial transactions related to videographic co-production, as described above.

This next section describes the 2006 post-restatement financial indicators as compared to those from the same period of 2005 (also post-restatement).

Over the six months in question the Group realized consolidated revenues of approx. Euro 17.6 million, up 19% compared to Euro 14.8 million in the same period of 2005.

Strong growth (+356%) for the consolidated Gross Operating Margin (EBITDA) that reached Euro 3 million compared to Euro 659 thousand as at 30 June 2005.

The consolidated EBIT, on the other hand, dropped to Euro -2.3 million (-1.2 million in the half-year before that) because of the significant increase in amortization (from Euro 1.8 to 5 million), which can be attributed to Moviemax Italia’s entry into the consolidation area.

Net financial charges as at 30 June 2006 were around Euro 309,000, as compares to the net profits of approx. Euro 3.2 million in the first half of 2005, which had benefitted from the aforementioned capital gain received upon Mondo Home Entertainment’s listing on the Expandi market of the Italian Stock Exchange.

The consolidated result before taxes for the period amounted to Euro -2.6 million, as compares to the positive balance of approx. Euro 2 million during the same half of 2005.

After taxes for the period and the minority result, the Group recorded a net result of Euro -1.4 million as compares to the Euro +474,000 of 30 June 2005.

The Net Financial Position as at 30 June 2006 stood at Euro -3.2 million.

The Group’s Net Equity, again as stands at the end of the half-year in question, was Euro 32.6 million (35.3 million at 31 December 2005).

2. e 3. Mondo TV Group’s consolidated financial statements as at 31 December 2006 and Mondo TV SpA’s draft financial statements

The Mondo TV Group recorded positive results in terms of revenues and EBITDA for this past fiscal year.

These results are even more significant, especially in terms of gross margins, in that they were achieved in an investment year that included the acquisition of Moviemax Italia in the film sector, and the establishment of Mondo TV France, for the co-production of animated TV programs for the French market.

In particular, in 2006 the Group’s consolidated revenues stood at Euro 34.9 million approx., up 31% compared to Euro 26.1 million of the previous year.

Strong growth also for the consolidated Gross Operating Margin (EBITDA) that reached about Euro 4 million (about +200% compared to Euro 1.3 million of the previous year).

The consolidated operating result (EBIT) was recorded at approx. Euro -4.4 million as compares to the Euro -2.83 million at the end of the 2005 fiscal year. The difference can be attributed to the significant increase in amortization (8.4 million as compares to the 4.2 million of the year before) resulting from considerable investments in the subsidiary Moviemax Italia S.p.A. for the purchase of new films.

Financial operations showed a slightly negative balance of about Euro -540,000. It is important to mention that the net financial profits in 2005 were positive by Euro 8.6 million, due to the capital gain (around Euro 10 million) earned through the listing of Mondo Home Entertainment SpA and subsequent increase in the subsidiary’s capital.

The consolidated result before taxes was Euro -4.9 million (+5.8 million at the end of 2005, due to the aforementioned capital gain brought in by the listing of Mondo Home Entertainment).

Because of the deferred active taxes amounting to about Euro 4.2 million, the Mondo TV Group recorded a positive post minorities net result of Euro 360,000, as compares to the Euro 8 million at the end of the previous fiscal year.  Again, the difference can be explained by the capital gain.

The Group’s Net Financial Position as at 31 December 2006, resulted negative by about Euro 10.9 million as compares to the positive balance of approx. Euro 9.2 million at the end of 2005. The 2006 figure (Euro 3.5 million of which is in debt to partners) is explained by the high level of activity in investments and acquisitions which the Group carried out over the course of the year, in terms of new production as well as the acquisition of new companies.

On the industrial front, total investments made in intangible fixed assets in 2006 amounted to Euro 2.5 million approx.. The Group is currently co-producing 3 animated TV programs on Rai (the third series of Sandokan, Gladiatori, and Kim) and 1 program with the German network ZDF (Laura Star).

The Group’s net equity as at 31 December 2006 stood at about Euro 34.3 million compared to Euro 35.3 million at the end of the previous year.

With regard to the Group’s leading company Mondo TV S.p.A., as at 31 December 2006, there was nearly Euro 5.1 million in revenue, a 25% increase over the Euro 4.1 million at the end of 2005.

It should be emphasized that over the course of 2006, costs (+8%) grew less than proportionately to revenues (+25%), which benefitted all income margins.

Consolidated Gross Operating Margin (EBITDA) exceeded Euro 1.3 million, up 117% compared to Euro 621 thousand as at 31 December 2005. Although EBITDA was analized in relation to revenue, it showed an increase, rising from 15% in 2005 to 27% in 2006.

Thanks to a lower level of amortization (Euro 3 million in 2006 as compares to 4.2 million in 2005), the operating result (EBIT) improved some, reaching Euro -1.6 million as compares to the Euro -3.6 million at the end of the fiscal year before.

Financial operations figures proved to be slightly negative (by Euro 325,000) due to the charges and losses on exchange rates. This compares to the positive amount of Euro 2.7 million for the 2005 fiscal year, which reaped the benefits from Mondo Home Entertainment’s listing in the stock exchange.

The entry relating to taxes is for approx. Euro +3.9 million (3.1 million in 2005) due to the positive balance between deferred active taxes (resulting from un-taxed revenue in previous years) and deferred passive taxes (from un-taxed amortization in previous years).

As a result of the standings described above, Mondo TV S.p.A.’s net result was positive by approx. Euro 1.9 million, dropping slightly from the Euro 2.2 million as at 31 December 2005.

With regard to the allocation of this year’s profits, the BOD resolved to make a proposal at the Shareholder’s Meeting (which will be called soon) to use the money to cover past losses.

As for the expected progress in management, considering the level of development some subsidiaries have reached, the company intends to re-focus its business on the production and distribution of animated programs.

4. 2007-2011 Budget

The Board of Directors also approved the new 2007-2011 budget for the parent company Mondo TV S.p.A, which illustrates significant growth in the main financial indicators over the next few years.

This plan was developed using the new accounting standard and is meant to replace the last plan released to the market, given that it was based on the old accounting standard.

The following table shows the progress in the main financial data of the parent company Mondo TV S.p.A. over the five years in question:

The following table, shown for informational purposes only, includes the main financial indicators of the Gruppo Mondo Home Entertainment (subsidiary of Mondo TV S.p.A.) recorded in the plan that was already approved and released to the market in December 2006:

5. 4Q 2006 (1st October - 31st December 2006)

During the 2006 Oct.-Dec. quarter, the Mondo TV Group brought in Euro 10.8 million in consolidated revenues, improving by 103% over the Euro 5.3 million from the same quarter of the year before.

Mondo Home Entertainment’s home video distribution and licensing (production and acquisition of media content and subsequent distibution) segments contributed significantly to this positive result.

Results were positive in the area of profitability as well, with a consolidated Gross Operating Margin (EBITDA) of Euro 620,000, which turned positive after the negative result of Euro -756,000 in the last quarter of 2005.
 
Amortization, allocation, and depreciation added up to approx. Euro 1.2 million, a decrease from Euro 1.5 million, despite the parent company’s continuation of ordinary production activities, and despite Moviemax Italia’s acquisition of films.

Based on the data described above, the consolidated Operating Result (EBIT) for the quarter in question was recorded at about Euro -646,000 (Euro +1.5 million for the corresponding quarter of 2005).

Because of the deferred active taxes for the period totaling about Euro 3.3 million, the Group’s net performance result was around Euro +2.5 million (as compares to the figure of approx. Euro +5.9 million for the fourth quarter of the year before, which benefitted from the capital gain related to the increase in capital for Mondo Home Entertainment)

Note:    Please refer to the following financial documents             related to this press release (downloadable in PDF format)

• Balance sheet, income statement of the consolidated and statutory draft financial statements as of 31 December 2006
• 4Q 2006 income statement
• Balance sheet, income statement of the half-year report as of 30 June 2006
• Report on variations as of 31 December 2005, highlighting adjustments resulting from the change in accounting standard

Rome, 14 February 2007

MONDO TV GROUP PRESS RELEASE: new co-production with RAI on Rudyard Kipling’s Kim.

TheMondo TV Group - leading European group focused on TV and cinema cartoon creation, production and distribution - has realized an agreement with Italian Rai Radiotelevisione Italiana regarding the production of an animated cartoons series (26 episodes of 26 minutes each) based on the famous novel “Kim” written by Rudyard Kipling.

This agreement comes out after the positive collaboration between the two companies on classical themes which also generates titles such as “L’Ultimo dei Mohicani” and “Sandokan”.

Subjects and storyboards will be realized by Lucia Zei together with Paolo Morales (who will be in charge also on graphics); the production will be directed by Giuseppe Laganŕ.

Total investments amount to about 6.4 million Euro.

Mondo TV will be responsible of coordination and executive production and will hold 65% of foreign languages TV rights, 65% Italian ancillary rights and 70% of foreign languages ancillary rights; Rai will hold other remaining rights.

Realization and delivery will be done in several tranches until June 2009 and payment by Rai (for its quote) to Mondo TV will be done in more times together with single deliveries. .

Rome, 10th January 2007