365 hf.Investors Presentation

Second Quarter 2007

Media Entertainment

Sales during the period amounted to ISK 5,495 million and increased by 2.4% from the same period 2006

Pro forma sales increased by 9.1% from the previous year

Earning before interests, taxes, depreciation and amotization (EBITDA) amounted to ISK 413 million compared to ISK 119 million in the same period 2006

Net finance cost amounted to ISK 170 million, including a foreign exchange gain of ISK 268 million

Cash and cash equivalents and market securities amounted to ISK 733 million at the end of the period

Equity ratio was 35.3% and Current ratio was 1.08

Acquisition of operating assets amounted to ISK 151 million

Main results for the first six months of year 2007

Sales during the period amounted to ISK 2,814 million and increased by 1.6% from the same period in 2006

Pro forma sales increased by 8.6% from the previous year

EBITDA amounted to ISK 274 million compared to ISK 195 million in Q2 in year 2006

EBITDA ratio was 9.7% compared to 7.0% the previous year

Net financial expenses amounted to ISK 163 million including net foreign exchange gain of ISK 170 million

Interest expense increased by ISK 136 million, mainly due to higher inflation and refinancing costs

The company’s media section generated good results and was slightly above expectations. The entertainment section was below the management’s expectations because of Sagafilm’s results

Main results for Q2

Sales revenue increased by 2,4% compared to the same period 2006

Pro forma sales increased by 9,1%

Contribution margin ratio was 36% and increased by 7% compared to last year

The ratio between operating expenses and revenue was 33% compared to 32% in 2006

Net foreign excange gain amounted to ISK 268 million in 1H 2007

After the company paid up loans in early July it is estimated that interests payments will be lowered annually by ISK 220 million

Income statement

Consolidated Income Statement

In ISK million 1H 2007 1H 2006 Change

Sales 5.495 5.368 127Cost of services and goods sold (3.516) (3.809) 293Gross Profit 1.979 1.559 420

Operating expenses (1.804) (1.725) (79)Results from operating activities (EBIT) 175 (166) 341Net finance cost (170) (1.377) 1.207Share of loss of associates (net of incom e tax) (78) (118) 40

Profit / (loss) before income tax (73) (1.661) 1.588Incom e tax expense (7) 289 (296)Profit / (loss) from continuing operations (80) (1.372) 1.292

Discontinued operations 0 (150) 150Profit / (loss) for the year (80) (1.522) 1.442

The Company lowered its non current assets by selling its shares in Wyndeham Press Group and Hands Holding

The increase in Current assets is mainly due to account receivable generated from the selling of the Company’s part in Hands Holding

Current ratio was 1,08 and the Equity ratio was 35,3% at the end of June 2007

Early July the Company paid up an un-indexed bond group to the nominal value of ISK 2.000 million. In addition refinancing of bank loans were finalised. Interest bearing loans following there actions amount to approx. ISK 7.000 million

Balance sheet

Consolidated Balance Sheet

In ISK million 30.06. 2007 31.12. 2006 Change

AssetsNon current assets 12.894 14.964 (2.070)Current assets 5.264 3.805 1.459 Account receivables 1.701 1.955 (254) Cash and cash equivalents 733 944 (211)Total Assets 18.158 18.769 (611)

Equity and liabilities Equity 6.403 6.137 266Liabilities Long term debt 6.892 6.465 427 Short term debt 4.863 6.167 (1.304) Interest bearing debt 9.110 8.702 408Liabilities total 11.755 12.632 (877)Total Equity and Liabilities 18.158 18.769 (611)

Cash flow

Consolidated Cash Flow

In ISK million 1H 2007 1H 2006

Loss of the year (80) (1.522)Activities not influencing cash flow (170) 668Cash used in operations before interests and taxes (250) (854)

Interest expense paid 55 9 Financial cost paid (462) (678)Net cash used in operating activities (657) (1.523)

Investm ents activities 24 (1.559)Financing activities 422 2.159Net cash used in continuing operations (211) (923)

Cash and cash equivalents at 1st of January 944 662Effect of exchange rate fluctuations on cash held 0 20Discontinued operations 0 2.785Cash and cash equivalents at 31st of M arch 733 2.544

Negative Cash flow can be explained by the following:

Payment to creditors related to investment activities in 2006.

Program inventory increased by ISK 200 million due to upcoming winter TV program and finally additional interests payments were paid in connection with lowering outstanding debt.

Acquisition of operating assets amounted to ISK 151 million

365 hf. - Sales in ISK million

1.620 1.688 1.6682.057

2.5982.770

2.548

3.180

2.681 2.814

200

700

1.200

1.700

2.200

2.700

3.200

3.700

1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07

230 231 224 236

116

194

106

54

139

274

0

50

100

150

200

250

300

1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07

EBITDA development in ISK million

In 4Q 2006 adjustments have been made for sales profit of ISK 1.586 million and other costs of ISK 110 million

Revenue and EBITDA breakdown between sectors in 1H 2007

Revenue EBITDA

Sales in ISK million - Media

1.6201.688 1.668

2.0571.908

2.015

1.764

2.065

1.8642.005

1.000

1.200

1.400

1.600

1.800

2.000

2.200

2.400

1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07

EBITDA in ISK million - Media

230 231 224236

61

112

17

77

229

-25

-50

0

50

100

150

200

250

300

1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07

In 4Q 2006 adjustments have been made for sales profit ISK 1.586 million and other costs ISK 110 million

Sales in ISK million - Entertainment

709 758881

1.420

1.045980

200

400

600

800

1.000

1.200

1.400

1.600

1Q06 2Q06 3Q06 4Q06 1Q07 2Q07

EBITDA in ISK million – Entertainment

55

82

131

37

6556

0

20

40

60

80

100

120

140

160

1Q06 2Q06 3Q06 4Q06 1Q07 2Q07

Outlook 2007

The Company’s management estimates that the lower range of the published budget will be reached.

New emphasis placed in the operation in addition to restructuring arrangements which generated good results in Q2 will be a support for the company in the second half of 2007.

It is forecasted that Sýn2, a new television station that will be broadcasting the English Football Premium League, will generate considerable increase in subscription and advertising revenue for the Company.

Vetrardagskrá

• Erlendir þættir

• Einkasamningar Stöðvar 2 (lógó fyrirtækjanna):

– Warner– Fox– Sony– Fremantle – HBO

End of presentation