SFL and language development

2012 has been a fantastic year for Sky: we improved our results considerably, delivered a substantial range of new products and services, reached record customer satisfaction and recommendation levels, and positioned Sky for a strong future.

We have laid a solid foundation for sustainable success. Alongside our renewed and extended exclusive broadcasting rights for the Bundesliga and other leading football and sport competitions, 2012 was full of important achievements: major Hollywood studio renewals, agreements with major cable network providers, the creation of leading premium HD offers in Germany and Austria, as well as a whole raft of exciting innovations and enhanced products for our services Sky+, Sky Anytime, and Sky Go, not to mention dramatic improvements in our customer service. Combine all this with the new financing structure we secured in January 2013 and we now have a unique long-term perspective with enhanced opportunities and greater flexibility.

Our subscription figures for full year 2012 showed great progress:

• Total customers increased by 12 percent to 3,363,000

• Sky Premium HD customers climbed 56 percent to 1,514,000

• Sky+ customers went up 126 percent to 929,000

• Second smartcard customers jumped 98 percent to 346,000

• Sky Go customer sessions increased by 335 percent to 33.3 million

We delivered a substantial volume of high-quality programming, exciting innovations and outstanding service to our customers:

• Bundesliga: Our most important achievement this year was securing the complete and exclusive live Bundesliga rights through the 2016/17 season, as well as the rights for all Austrian Bundesliga matches through the 2015/16 season.

• Movies: We extended and expanded our exclusive contracts with major Hollywood studios and many others to also include multi-platform and on-demand distribution. Together with other important rights exten-sions in 2012, Sky customers are guaranteed an unrivalled slate of top-class entertainment, wherever and whenever they want.

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• HD portfolio: We significantly expanded our HD portfolio from 42 channels to 64 HD channels (as of 17/01/2013). A major milestone was the launch of Sky Atlantic HD, the Home of HBO. Following agreements with all major cable providers, the channel is now available throughout Germany and Austria.

• Ultra HD: For the first time in German television history, we tested a live production of a football match in Ultra HD. This is just another way we are ensuring that our customers will always be on the cutting edge of great entertainment.

• Sky Anytime: We added even more exclusive, first-run blockbuster movies, as well as the latest hit TV series, exciting documentaries and select children’s programming.

• Sky Go: Customers can now enjoy a substantially wider range of content with popular TV series and films, including a large selection of titles from Sky Atlantic HD’s outstanding program line-up. We also expanded Sky Go for iPhone by offering three additional HD sports channels. The introduc-tion of a dedicated kids’ zone was our most recent innovaintroduc-tion.

• Marketing and distribution: We concluded marketing cooperations with major German cable network providers Kabel BW, Unitymedia, and Kabel Deutschland. And we also secured an IPTV distribution partnership with Deutsche Telekom, which will give Deutsche Telekom’s customers full access to Sky products for the first time.

Record audience levels underline the growing appeal of our exclusive high-quality content. Our programming line-up is clearly resonating with the viewers, reaching over 20 million people over the course of the year.

Sky Deutschland was also recognized by multiple awards in 2012. When judged against all the premium TV providers in Germany, Sky was recognized as the service leader in its category. The TÜV awarded Sky with their official

seal of approval for delivering top service and the company was voted the

“fairest Premium TV provider” by Focus-Money magazine. In addition, Sky secured the Sport Bild Award for the best TV sports editorial department for the fourth time, which highlights Sky’s dedication to delivering compelling content to its customers.

Over the past three years we have seen continuous improvement in the overall performance of our business. The result is a solid foundation for sustainable success. We will continue to deliver exciting innovations for our customers and to expand our growing portfolio of great entertainment products and services, to exploit the full potential of this underpenetrated and expanding pay-TV opportunity.

Looking back on how far we have come in such a short amount of time and how much further we intend to go, I couldn’t be more excited. On behalf of the Board at Sky, I would like to thank our customers and viewers for their loyalty, our shareholders for their ongoing support, and our people for their passionate commitment.

Yours sincerely,

Brian Sullivan

To the Shareholders

Steven Tomsic Chief Financial Officer

• born 1969

• entered the Company in December 2010 as Deputy Chief Financial Officer

• comprehensive industry experience, particularly in financing, and very good knowledge about the Company as a former supervisory board member of Sky Deutschland AG

• Chief Financial Officer since February 2011

Brian Sullivan

Chief Executive Officer (CEO)

• born 1962

• entered the Company as Deputy CEO in January 2010

• more than 20 years of pay-TV experience in the US and Europe

• Chief Executive Officer since April 2010

• in December 2012 contract extension through December 2014

Carsten Schmidt

Chief Officer Sports, Advertising Sales & Internet

• born 1963

• entered the Company in July 1999

• comprehensive knowledge in the fields of sports media, media sales, sports programming and production as well as the acquisition of sports rights

• Member of the Management Board since March 2006

Dr. Holger Enßlin

Chief Officer Legal, Regulatory & Distribution

• born 1967

• entered the Company in October 2003

• long-term experience as a lawyer and as General Counsel of the Company

• Member of the Management Board since 1 December 2008

• responsible for the business unit “Distribution” since December 2010