2015 Interim Results5 August 2015

i-CABLEii--CABLECABLECommunications Communications LimitedLimited

• An abundant supply of free channels, pay channels & streaming content continued to expand the direct & indirect competition which further weakened the demand for our subscription content & thereby the Group’s Pay TV operating results

• Need to continue to enrich our programmes to bring distinctive &premium content to our customers for the best viewing pleasure to attract & retain subscribers

• Broadband competition was also severe, as rival operators gainedmarket share from us with faster connectivity

• New product initiatives & investments to strengthen our customerbase & boost revenue across segments

• Free TV licensing process underway

Results Highlights

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Television

• We have seen early signs of revenue stabilization in Pay TV as aresult of our efforts to drive up price point. Revenue, however,continued to shrink along with the contraction of customer base at a time when sales remained weak

• Our teams are putting in place more effective customer management practices to retain loyal customers & enhance our service image

• A new conditional access system for Pay TV services will be launched later this year. The new HD set top box will offer interactive & VOD services to enrich our customer experience. Our marketing & sales teams are putting the finishing touches on theservice, which will tie in with the launch of HD News Channel 209

Subscription Services

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Television

• Our Pay TV licence will expire in May 2017 & we have submitted our application for renewal. The Communications Authority has kickedoff a public consultation on 22 July, which will end on 21 August

• 2 public hearings on 28 July & 13 August respectively

Subscription Services

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Television

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2015

HK$M 1H 2H 1H vs 1H14

Turnover 648 618 570 - 12%

Opex before dep’n (577) (655) (597) 3%

EBITDA 71 (37) (27) n/a

Depreciation (68) (68) (68) 1%

Operating Profit / (Loss) 3 (105) (96) n/a

EBITDA Margin 11% -6% -5%

Operating Margin 1% -17% -17%

2014

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• Margin hurt by competition with lower subscription & advertisingincome

Programming

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NewsNews

• Major International sports events covering

football, basketball, volleyball, badminton,

tennis, table tennis & cycling

�UEFA Champions League

�European Qualifiers

�J League

� International Champions Cup

�BWF World Badminton Championships

�FIVB World Cup Volleyball

�FIBA Americas Championships

� ITTF World Cup Table Tennis

�Fed Cup & Davis Cup

�UCI Track Cycling World Cup I & II

HD SportsHD Sports

Programming

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Programming

EntertainmentEntertainment

Programming

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50%

27%

15%

7%

0%

10%

20%

30%

40%

50%

60%

HKC Now TV TVBNV bbTV

Viewership

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• We remained as the most watched Pay TV service in Hong Kong• To attract & retain subscribers, we need to continue to enrich our

programmes to bring distinctive & premium content to our customers for the best viewing pleasure

Source: Nielsen

All Individuals aged 4+ All Day All Time

58%

27%27%

15%

CABLE TV Now TV* TVBNV^ bbTV

Viewing Share Among Pay TV Operators

* Excluded some individual TVBNV channels via Now TV platform on the top 50 channels list^ Included some individual TVBNV channels via Now TV platform on the top 50 channels list

50%

1%

13%

7%

1H13 1H14 1H15

TV Services Watched Yesterday

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54%

26%

18%

3%

Source: 2014 Nielsen Media Index (Jan – Dec 2014)

Weighted by Population

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50

100

150

200

250

300

350

400

450

500

550

600

650

700

CABLE TV Now TV TVBNV bbTV

640628

Aged 12-64 (‘000)

164

48

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Customers

969,0001,002,000

179,000186,000

105,000110,000

June 2015December 2014

Television

Broadband

Telephony

Internet & Multimedia

• Broadband reported continuous growth in our mid-range price plans. However, the contraction of customer base had resulted in lower revenue & operating margin during the reporting period

• Network enhancement to higher-speed broadband services is underway & expected to cover many more homes by next year. The faster & more reliable broadband service should facilitate our customer retention & acquisition, as well as upselling opportunities

Subscription Services

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Internet & Multimedia

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2015

HK$M 1H 2H 1H vs 1H14

Turnover 180 184 174 - 4%

Opex before dep’n (107) (102) (103) - 4%

EBITDA 73 83 71 - 4%

Depreciation (45) (44) (43) - 4%

Operating Profit 29 39 28 - 3%

EBITDA Margin 41% 45% 41%

Operating Margin 16% 21% 16%

2014

• Broadband competition was severe, resulted in lower revenue & operating margin

Consolidated Results

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2015

HK$M 1H 2H 1H vs 1H14

Turnover 843 823 760 - 10%

Opex before dep’n (747) (831) (774) 4%

EBITDA 95 (7) (15) n/a

Depreciation (113) (113) (112) - 1%

Operating Profit / (Loss) (18) (121) (127) 600%

Finance Costs & Others (0) (0) (2) n/a

Profit / (Loss) before taxation (18) (121) (129) 606%

Taxation (5) 5 8 n/a

Net Profit / (Loss) (23) (116) (121) 422%

Capex 81 107 79 - 3%

2014

• Intense competition weakened our operating results• New product initiatives & investments are necessary to

strengthen our customer base & boost revenue across segments

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HKCNE

• HKCNE has successfully won the multi-year contract for the advertising sales agency services for Newsline Express & it will continue to be the exclusive sales distributor & content provider of MTRC's "Newsline Express" from 2016 onwards

• Sundream Motion Pictures continued with its proven track record of identifying quality productions & bringing them to the Hong Kongaudience. During the reporting period, Sundream released a total of 10 films in Hong Kong & Macau

• Sundream has put more focus on quality pictures with mainstream commercial appeal, like Selma & Midnight Diner on the acquisition side & on the production side, entertaining stories, like the coming Love Detective & My Wife is a Super Star

Sundream Motion Pictures

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Operating Expenses

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2015

HK$M 1H 2H 1H vs 1H14

Programming 421 505 458 9%

Network 111 110 102 - 8%

Selling, CS, G&A 167 166 171 2%

Cost of Sales 48 50 42 - 12%

Sub-total 747 831 774 4%

Depreciation 113 113 112 - 1%

Total 861 944 887 3%

2014

• Lower programming cost compared to 2nd half 2014 due to the absence of special programme, however, programming rights fee continued to escalate

• In April, the Government decided not to renew the free TV licence of ATV & its licence will expire on 1 April 2016. Off-air spectrum will be released concurrently & could be assigned to new licensees

• We have been discussing licensing terms & conditions with the Communications Authority. Restructuring of the shareholding & control of Fantastic TV is underway

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Outlook

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i-CABLE Communications LimitedHKSE Stock Code: 1097.HK

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included herein constitute i-CABLE’s judgement as of the date hereof and are

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