CTC Media Investor Presentation

CTC Media, Inc.

Investor Presentation

Third Quarter 2012 Results

A Leading Independent Broadcaster in Russia

1

From Private TV Network to Public Media Holding Acquisition of the DTV group Acquisition of Channel 31 in Kazakhstan

CTC Media was founded as StoryFirst Communications

1989

CTC Media enters Moldova free-to-air TV market Launch of CTC Network

1994

1996

Launch of Domashny Network

2002

2005

Acquisition of Costafilm and Soho Media production companies

2006

2008

Launch of CTCinternational in Kazakhstan, Kyrgyzstan, Armenia, Georgia, Azerbaijan, Thailand

Launch of CTCinternational in Israel Establishment of CTC Media’s internal advertising sales house ‘Everest Sales’

Uplink of СTCinternational to the HOT BIRD satellite (Europe, Middle East, North Africa and Central Asia)

Launch of ‘Videomore’ online social television network

2009

2010

2011

2012

Launch of CTC-international in Germany and the Baltics Launch of CTC Network

Modern Times Group became a shareholder of CTC Media

Initial Public Offering on NASDAQ

Launch of CTCinternational in USA

Telcrest Investments Limited acquired a 25% stake in СTС Media from Alfa Group Costafilm and Soho Media united into Story First Production DTV is rebranded to Peretz

2

We Fully Capture the Value Chain by Being a Vertically Integrated TV Broadcaster CTC – target audience All 6-54 (All 10-45 starting 2013) Domashny – target audience Females 25-59 FREE-TO-AIR ( RUSSIA)

Peretz – target audience All 25-59 (All 25-49 starting 2013) Kazakhstan

Channel 31

Moldova

СTС Mega

FREE-TO-AIR (CIS)

CONTENT PRODUCTION

AD SALES

Free-to-air Story First Production TV ad maket growth1

Internal advertising sales house Everest

International version of CTC channel CTC-INTERNATIONAL (PAY-TV) Various digital projects NEW MEDIA

Online video portal Videomore.ru Women’s portal Domashniy.ru

Note: (*) DTV Network operates under Peretz brand name & logo starting from October 2011

3

We Operate in Attractive Markets

Armenia, Georgia, Azerbaijan

Russia

Kazakhstan

Population = 142 million 2011 TV Ad Market = US$ 4.4 billion*

Population = 16.3 million 2011 TV Ad Market = US$ 120 million* Russian-speaking population = 12.3 million

Kyrgyzstan

Russian-speaking population=10.4 mln

Russian-speaking population = 2.5 million

Thailand

USA

Russian-speaking tourists = 0.8 million (2011)

Russian-speaking population = 3.5 million

Germany Russian-speaking population = 6 million

Israel Russian-speaking population = 1.5 million

Moldova Population = 3.6 million 2011 TV Ad Market = US$ 16.6 million*

Baltic states Russian-speaking population = 4 million

Sources: Video International, Russian Association of Communications Agencies, ZenithOptimedia, CIA World Factbook, Rosstat, Russkiy Mir Foundation Note: (*) All TV Ad Markets figures are net of VAT

Since February 2012 CTC-International is available on the HOT BIRDTM 8 satellite (W/E Europe, North Africa, Middle East and Central Asia coverage)

4

We Are the Largest Independent FTA-Broadcaster in Russia

Combined audience shares, % (all 6-54 demographic) #2 up from #4 in 9M 2011

22.7 22.4

15.6 14.8 14.7

15.5 14.2 12.0 9.9

6.9 4.7

5.1

4.7 3.3 9M 2011 9M 2012

Gazprom-Media

Source: TNS Russia

СTС Media

VGTRK (Rossiya)

Channel One

National Media Group

Prof-Media

UTV Russia Holding

5

Growth Company Operating in a Dynamic Market

6

Russian Ad Market Has Significant Potential for Further Development… Russian TV ad market was #9 in the world and #5 in Europe in 20111…

Free-to-air TV ad market growth1

58.0

10.2

19.2

11.4 10.9 5.4

5.1

4.9

4.5

4.4

7.0

US $ bln

US $ bln

8.9

5.8 4.7 3.3

4.4 3.6

3.0

1.4

2004

2008 TV Ad Market

…and is expected to become # 5 in the world and #1 in Europe in 20141

2009

2010

2011

Total Ad Market

Russian TV ad market forecast2

65.5

20.4

275 16.2 13.7

USA

Japan

China

Brazil

190 5.8

Russia Germany

Note: All TV Ad Markets figures are net of VAT Sources: (1) Zenith Optimedia, Company’s estimates (2) Video International

4.9

Italy

4.7

France

RUB bln

US $ bln

5.9

131

2011

2015F

2020F

7

…Due to Relatively Low Ad Spend as % of GDP and Underleveraged Consumer

Ad spend as % of GDP¹

1.8

Retail and mortgage loans as % of GDP2

1.7

8% 1.4

1.4

8% 1.1

0.9

1.2 1.0

0.9 1.0

14% 9% 0.9

0.8

0.8

0.8 0.7

0.7

5%

0.7

0.6

0.6

0.5

15%

37%

0.6

13% 30%

0.5

21%

21%

12% 19%

15%

7%

12%

2008

2011

Household loans excl mortgages, % of GDP

Russia

3%

Romania

Bulgaria

Hungary

Lithuania

Crech Rep

Poland

Latvia

Estonia

Poland

Ukraine

Russia

CEE Average

Germany

UK

Belgium

USA

Austria

Bulgaria

Slovenia

6%

Mortgage loans, % of GDP

Sources: (1) ZenithOptimedia, Company’s estimates (2) Eurostat, National Central Banks, 2011

8

TV Is the Most Attractive Advertising Medium in Russia FY 2011 cost per thousand in Russia (US$)²

 TV is the only medium with truly national reach

TV

 Important social and cultural platform

Radio

1.8

2.9

 More free-to-air networks than in other countries Internet

 High quality free-to-air content offering

4.9

Newspapers

5.4

Magazines

Ad spend in Russia by media segment1 (%)

48% 43%

H1 2011 TV cost per thousand (US$)²

46%

Russia Asia

31%

19%

Western Europe

18%

Eastern Europe 6%

0.4% 2%

Sources:

Press 2004

8.0 9.0

2012F

Outdoor 2020F

(1) Russian Association of Communication Agencies, Video International (2) Initiative Media

11.0

4%

1%

Internet

2.1

13%

14%

TV

6.0

Radio

North America

17.0

Other

9

Internet Consumption Is Growing… 2011: Russia is #1 in Europe by number of Internet users

50.8

Increase of time spend online (hours per day)

50.1

3.1

42.3

2.9

2.7

2.4

37.2

2.3

2.1 1.7

23.7

0.9 0.5

Russia

Germany

France

UK

Italy

China

Russia

Brazil

Internet users, mln

2009

2011: Internet Ad market growth in Russia (USD, mln)

0.7

India

USA

Japan

2015E

2011: Broadband penetration by country

1,422 75%

75%

75%

882 599

510

38%

37%

Eastern Europe

Russia

371

2007

2008

2009

2010

2011

Sources: ComScore, Boston Consulting Group, Zenith Optimedia, AKAR, Mindshare Interaction, ITU

USA

Western Europe

UK

10

…but Not at the Expense of TV Usage Average linear TV viewership globally is increasing

184

185

187

188

183

2004

2005

2006

2007

2008

190

2009

2010

Minutes per day*

186

196

192

2003

222

2009

(*) All 4+ demographic Source: Eurodata TV Worldwide

227

Russia

228 Minutes per day*

Minutes per day*

Europe

2010

2011

2011

217 203

9M 2011

9M 2012

11

We Continue to Deliver Strong Top and Bottom-line Growth…

280

766

730

247

250 41%

39%

680

38%

41%

200 574

220

45%

221 38%

211 37%

174

532

32%

35%

32%

150

427

104 100

273

71 US $ mln

US $ mln

181

50

26%

26%

25%

27%

22%

21%

16%

21%

20%

2009**

2010

2011**

0 2004

2005

2006

2007

2008

2009

2010

(Comparable-basis) total operating revenues***

Notes:

(*) (**)

(***) (****)

2011

15% 2004

2005

OIBDA*

2006

2007

OIBDA margin*, %

2008**

Peers average OIBDA margin****,%

OIBDA is defined as operating income before depreciation and amortization (exclusive of amortization of programming and sublicensing rights. OIBDA margin is defined as OIBDA divided by total operating revenues. Both OIBDA and OIBDA margin are non-GAAP financial measures (see reconciliations on page 46) 2008 OIBDA and OIBDA margin are adjusted to exclude a $232.7 million charge arising from the impairment of the intangibl e assets of DTV Group in Russia, Channel 31 in Kazakhstan and a broadcasting group in Moldova; 2009 OIBDA and OIBDA margin are adjusted to exclude an $18.7 million charge arising from the impairment of the broadcasting licenses in Russia and a $28.6 million stock-based compensation expense recognized in conjunction with the previously announced settlement, DTV brand name by CTC Media of litigation brought by it against its former CEO, 2011 OIBDA and OIBDA margin are adjusted to exclude a $106.4 million charge arising from the impairment of several regional broadcasting licenses and the Peretz Network goodwill; (see reconciliations on page 44-45) Comparable-basis operating revenues are non-GAAP financial measures provided in order to facilitate period-to-period comparisons of CTC Media’s results following the implementation of the new model of advertising sales starting from 2011 (see reconciliations on page 47) Following companies are included in European peers average OIBDA margin calculations: CME, TVN, S.A. Modern Times Group, Antena3, ITV plc, Metropole Television, Mediaset, ProSiebenSat, Mediaset Espana, TF1

12

…and to Diversify Our Lines of Business

69%

14% 10%

2004

9M 2012

Sublicensing

3% CIS

3% New Media

0.3% CTCInternational

0.5% Russian FTA Broadcasting

Russian FTA Broadcasting

100%

93% 13

Strategic Focus on Long-Term Growth and Diversification

14

• • • •

Build library Develop in-house production Invest in ideas development Increase production volumes Create strong brands

Up to 20%

of CTC Media channels’ programming grid (from ~10% in 2011)

• •

Stabilize audience share Improve audience profile

NEW MEDIA

•

BROADCASTING

CONTENT CONTENT

We Have Clear Strategic Priorities

DISTRIBUTION PLATFORMS: • Enhance existing platforms

female portal

•

•

Grow audience and market shares

Grow audience and market shares

comedy portal

• •

•

Expand to markets with Russianspeaking audiences

Be available on all screens

DIVERSIFICATION: • iVas on existing platforms

•

•

Develop distribution collaboration (VK, Youtube)

•

Games Transmedia branded entertainment content

Content is king…. Distribution platform is queen

15

We Focus on Developing and Creating Local Content

Long-term relationships with large independent producers

Discover new third party partners

In-house production

Karo Production

Amedia

YBW

Sputnik Vostok Production Good Story Media / Lean-M

• • •

Stable and predictable pricing Right of first look for new products Proven track record

• •

Diversification of content suppliers Discovering new creative talents & ideas

• • •

Securing all rights to the own content Full control over production costs & processes ~ 50 projects currently under 16 development

16

More Original Ideas Are Generated by Our Enhanced Internal Creative Team

50

Totally titles in development*

Titles in full scale production – 23 49 titles have been presented to channels

Pilots in production – 10 Titles under development – 16

1 titles under initial development

7 times more projects in in-house development compared to end of Q3 2011

Note: (*) as of June 30, 2012

17

CTC Adjusts Its Target Audience to More Commercially Attractive Demographic

4.0% Advertisers' demand

CTC audience demographic profile

3.5%

3.0%

2.5%

~80% of advertisers’ budgets allocated to “All 10-45” demographic

45

2.0% 6

10

1.5% 54

1.0%

2013 Target Audience

0.5%

2012 Target Audience

0.0% 4

9

14

Sources: TNS Gallup Media, TV Index, H1 2012

19

24

29

34

39

44

49

54

59

64

69

74

18

Peretz Adjusts Its Target Audience to More Commercially Attractive Demographic

4.0% Advertisers' demand

3.5%

3.0%

Peretz audience demographic profile

25

~70% of advertisers’ budgets allocated to “All 25-49” demographic

2.5%

2.0% 49

59

1.5% 2013 Target Audience

1.0%

0.5% 2012 Target Audience

0.0%

4

6

8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74

Sources: TNS Gallup Media, TV Index, H1 2012

19

Domashny and Peretz Are Benefiting from Fragmentation of Russian TV Market

Audience shares, all 6-54 demographic Channels’ target demographics, %

3.7 3.1

60%

2.6 2.0

Top 3 state-controlled channels

50%

9M 2011 9M 2012

9M 2011 9M 2012

40%

1st tier channels

30%

2nd tier channels

20%

10%

2004

2005

2006

2007

2008

2009

2010

Notes: top 3 state-controlled channels: Channel One, Rossiya 1, NTV; 1st tier channels: CTC, TNT, Ren-TV; 2nd tier channels: TV-3, Domashny, Peretz, Rossiya K, Channel 5, Rossiya 2, Euronews, Zvezda, MTV, Rossiya 24, Muz TV, 2x2, TV Center, Disney

2011

9M 2012

20

Positive Audience Share Momentum for Smaller Channels in 2012

12.7

12.1 10.7

11.5

11.0

10.2

10.1

8.9

3.7

9.9

8.7

3.3 3.1

3.8 3.6

2.8

FY 2011

Q1'12

Q2'12 All 10-45

Q3'12

Sep'12

All 6-54

2.6

3.3

2.0

Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12

2.1

2.0

2.6

2.6

2.0

Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 All 25-59

W 25-59

Road Wars Kitchen (From 22.10.12) Average share

16.1%1 (19.6% in All 10-45)

Maximum share

16.7% (20.8% in All 10-45)

Average share – 2.9%3 Maximum share – 5.0%

Voroniny (01.10.12 - 18.10.12)

Jokes (Anecdotes)

Average share

10.1% (11.9% in All 10-45)

Average share – 2.9%

Maximum share

11.8% (14.6% in All 10-45)

Maximum share – 5.0%

What’s up?

While the fern blooms (01.10.2012-18.10.2012) Average share

10.9% (13.1%i n All 10-45)

Maximum share

12.6% (15.1%i n All 10-45

Boarding School (03.09.12 - 27.09.12) Average share

13.4% (16.5% in All 10-45)

Maximum share

15.3% (18.5% in All 10-45)

Note:(1) in CTC target demographic All 6-54

Average share – 2.3% Maximum share – 3.6%

Third Season (From 01.09.2012)

Wordplay (Kalambur)

Average share – 12.1%2

Average share – 2.1%



Note:(2) in Domashny target demographic All 25-59

Note:(3) in Peretz target demographic All 25-59

21

Our Evolving Business Model…

Advertising sales structure since 2011 Advertisers

Advertising Agencies

Internal Sales Houses

Everest Sales

External Sales Houses

RTR-Media

Gazprom-Media / Alkasar

Video International

Consultancy services

22

…Enables Us to Capture Further Opportunities

More control over the sales process Mastering internal expertise in direct sales

Lower cost of sales as % of revenues

Bundling sales with additional options, including non-FTA

Individual approach to each client and customized offerings

Working directly with advertisers and media agencies

23

Stable Consumer Goods Client Base with Both Large Multi-National and Local Advertisers

Ad spending on CTC Media’s channels by category

1 2 3 4 5 6 7 8 9 10 11

9M 2011

9M 2012

28% 16% 17% 10% 7% 6% 3% 2% 8% 2% 1%

29% 18% 15% 11% 8% 4% 4% 4% 3% 3% 2%

Food and beverages Cosmetics and personal care products Other goods Pharmaceuticals and vitamins Telecoms Beer Auto Detergents Appliances Retail Finance

Notes: (*) National advertising sales for CTC, Domashny and Peretz Networks

*

■ Vast majority of CTC Media’s advertisers are basic consumer goods focused ■ CTC Media’s advertisers’ budgets split:  80% multinationals, 20% local companies ■ Ad revenue concentration is stable:  42% of budgets came from top 10 clients vs 40% in 9M 2011 ■ Growth from auto and finance categories in 9M 2012

24

Developing in Attractive CIS, International and New Media Markets

25

We Are Strengthening Our Market Positions in the CIS

Channel 31, Kazakhstan (all 6-54 demographics)

Significant growth in CIS Segment revenue and OIBDA margin

+30% y-o-y 17.8 15.3

15.5 12.6

11.2

FY 2010

20.2%

11.0

US$ mln

Target audience share, %

15.2

FY 2011

Q3 2012

4.3% -20.2%

FY 2009

FY 2010 Revenue

FY 2011

9M 2012

OIBDA margin

26

Plus We Continue to Expand Internationally… Increasing CTC Media’s international brand awareness & value through CTC-international

USA

December 2009 – Dish May 2011 – Time Warner; RMG October 2011 – Cablevision

Russian-speaking population

3.5 mln

Israel

June 2011 – Hot; Yes

Germany

March 2011 – Kartina TV IPTV

6 mln

Baltic States

October 2011 – Viasat Broadcasting

4 mln

Kazakhstan

February 2012 – Digital TV; Icon TV

Europe North Africa Middle East Central Asia

Kyrgyzstan

Armenia Georgia Azerbaijan

Thailand

1.5 mln

12.3 mln

February 2012 – uplink service HOT BIRDTM

April 2012 – Europe-Asia cable and satellite network

May 2012 – Caucasus cable networks

2.5 mln 10.4 mln

July 2012 – Thai Media Export cable network

Total Russian-speaking population

40.2 mln

27

…and Enter New Platforms to Be Wherever Our Viewers Are

28

…on the Way to Become a Leading New Media Player among Russian TV Companies

Note: (*) Videomore average monthly unique visitors in 9M 2012; TNS Web Index IStar, Russia, cities 100 000+, All 12-54 (**) From CTC, Domashniy and Peretz (***)Domashniy portal average monthly unique visitors in September 2012

29

Strong and Flexible Financial Position

30

9M 2012 Financial Highlights

Three Months Ended September 30, 2011 Total operating revenues Total operating expenses (before nonrecurring items)

2012

Nine Months Ended September 30,

Change in USD

in RUB 12%

$159,578

$162,009

2%

(116,217)

(123,554)

6%

2011

Change

2012

in USD

in RUB

$529,602

$540,713

2%

10%

(388,568)

(403,165)

4%

12%

(133,060)

(206,057)

55%

17% 71%

(405,411)

(485,668)

20%

29%

Adjusted OIBDA

48,141

43,366

-10%

-1%

153,959

152,599

-1%

7%

Adjusted OIBDA margin OIBDA

30.2% 31,298

26.8% -39,137

-225%

-238%

29.1% 137,116

28.2% 70,096

-49%

-45%

OIBDA margin Adjusted net income attributable to CTC Media, Inc. stockholders

19.6%

-24.2%

25.9%

13.0%

29,867

27,522

-8%

1%

91,127

94,190

3%

12%

$0.19

$0.17

-11%

1%

$0.58

$0.60

3%

11%

16,393

(38,480)

-335%

-359%

77,653

28,188

-64%

-61%

$0.10

($0.24)

-340%

-364%

$0.49

$0.18

-63%

-60%

Total operating expenses

Adjusted diluted earnings per share Net income/(loss) attributable to CTC Media, Inc. stockholders Diluted earnings per share

31

9M 2012 Balance Sheet and Cash Flow Highlights

Consolidated Balance Sheet Highlights

Consolidated Cash Flow Highlights

As of December 31, 2011

(US$ mln)

Nine months ended September 30,

As of September 30, 2012 (US$ mln)

Cash and cash equivalents

12.3

24.0

Short-term investments

117.2

80.1

Total assets

893.1

887.3

including goodwill

164.4

173.8

including broadcasting licenses

159.4

84.6

including programming rights

199.1

239.7

197.1

241.9

16.9

7.8

Stockholders’ equity

697.2

697.3

Net cash position2

112.6

96.4

Working capital1 Total debt (bank overdraft)

Notes:

(1) Working capital = current assets - current liabilities (2) Net cash position = cash and cash equivalents + short-term investments - total debt (3) Free cash flow = cash flow from operating activities - acquisitions of property and equipment and intangible assets

2011

2012

Cash at beginning of period

59.6

12.3

Net cash provided by operating activities

57.0

57.0

(254.0)

(272.2)

(1.9)

26.9

including acquisition of busineses

(24.5)

(2.7)

including CapEx

(16.0)

(9.4)

including receipts from/(investments in) deposits

(38.6)

(39.0)

(59.2)

(72.0)

56.8

24.0

CapEx

(16.0)

(9.4)

CapEx as % of total revenue

3.0% 41.0

1.7% 47.5

including acquisition of progr. and sublic. rights

Net cash used in investing activities

Net cash used in financing activities Cash at end of period

Free cash flow3

32

High Levels of Cash Conversion and Return on Capital Employed

% of OIBDA Converted to Operating Cash Flow

Return on Capital Employed*

Cash investments in content up y-o-y 43% ($108 mln) 46%

US$ mln

200 180 160 140 120 100 80 60 40 20 0

186

2006-2011 average ROCE: 33%

186

36%

158

33%

133 117

116

27%

27%

27%

2009

2010

2011

84% 67%

72%

66%

63% 47%

2006

2007

2008

Operating Cash Flow

2009

2010

2011

2006

2007

2008

% of OIBDA converted

Note: (*) ROCE excludes one-off non-cash asset impairment charges recognized in 2008, 2009 and 2011.

33

Operating Expenses

as % of total operating expenses

Depreciation & amortization

3%

4%

4%

1%

8%

as % of total operating revenues

8%

Stock-based compensation

2% 30%

31%

3%

6%

3% 1%

6%

Direct operating expenses 22%

23%

40%

42%

SG&A expenses 54%

56%

Amortization of programming & sublicensing rights and own production cost 9M 2011

9M 2012

9M 2011

9M 2012

$116.2 mln

$123.6 mln

$388.6 mln

$403.2 mln

34

To Conclude…

35

Appendix

36

CTC Media Shareholder Structure

CTC Media, Inc. Number of common shares outstanding (as of September 30, 2012)

38%

158,160,719

25%

37%

Modern Times Group MTG AB

Telcrest Investments Limited

Free float

Shareholder of CTC Media since 2002

Shareholder of CTC Media since 2011

IPO on NASDAQ in June 2006

Source: U.S. SEC filings, as of September 30 2012

37

Audience Shares In “All 10-45” Most Commercially Attractive Demographic Audience shares1, %

15.8 15.8

15.5

13.2

12.6

12.1

11.8

9M 2011 11.1 11.2

9M 2012

10.6 10.4 9.0

5.2 4.5

3.7

3.3

2.4 1.9

2.8

2.7 1.9

1.4

1.9

2.2

2.2 2.3

1.9 1.8

2.1

1.6

1.5 1.5

1.3 1.4

1.2

1.2

0.9 0.8

0.9

0.7 0.1 0.1

TNT

Channel One

CTC

NTV

Rossiya 1

Ren-TV Channel 5 Disney*

(1) Source: TNS Russia, CTC Media’s Research Department (2) Includes audience shares of regional and non-FTA channels (*) Operated under Semerka brand before 31 December, 2011 (**) Operated under Muz-TV brand before 1 September, 2012

TV-3

Peretz

Domashny Rossiya 2

U**

TV Center

2x2

MTV

Zvezda

Rossiya K Rossiya Euronews 24

38

Other

Audience Shares In “All 6-54” Demographic Audience shares1, %

16.1 16.2

15.5

12.0

12.3 11.8

11.6

9M 2011

10.8

10.4 10.6

9M 2012

10.1

9.6

5.4 4.6

4.4 3.3 2.4

2.4

2.8

2.6 1.9

1.7

2.2

2.5

2.5 2.1

2.0

2.3

1.4

1.6

1.6

1.4

1.2

1.3

1.1 1.0

1.0

1.1 0.8

0.7 0.1

Channel One

NTV

TNT

Rossiya 1

CTC

Ren-TV

Channel 5

Disney*

TV-3

Peretz

Domashny TV Center Rossiya 2

Zvezda

U**

2x2

Rossiya K

MTV

0.1

Rossiya 24 Euronews


39

Other

Audience Shares In “All 4+” Demographic

Audience shares1, %

17.1 15.7

15.2 14.4 14.3

14.3 13.8

13.3

9M 2011 9 M 2012

7.6

7.8

7.7

6.9

5.2

5.0

4.4

2.7

2.7 2.3

2.9

2.6

2.5 2.0

2.4

1.7

2.4 2.0

2.1

1.7

1.6

1.8

1.7

1.7 1.1

1.0

0.9

0.9

0.8

0.8

0.7

0.7

0.2

NTV

Channel One

Rossiya 1

TNT

CTC

Ren-Tv

Channel 5 Domashny TV Center

TV-3

Disney*

Rossiya 2

Peretz

Zvezda

Rossiya K

U**

Rossiya 24

2x2

MTV

0.1

Euronews


40 40

Other

We Continue to Increase Our Technical Penetration

Technical Penetration1, %

87% 88%

91%

94% 95%

71%

76%

82%

85%

80%

68%

65%

73%

■ We continue to improve the signal distribution through regional stations acquisitions and expanding our affiliate network

61% 54%

■ 50% of technical penetration is provided by CTC Media’s owned-and-operated stations and repeater transmitters

2007 2008 2009 2010 2011

2007 2008 2009 2010 2011

2007 2008 2009 2010 2011

41 41

Note: (1) Technical penetration means the percentage of the population that has the technical ability to receive a particular broadcast signal. Measured annually by TNS Gallup Media in cities with populations of more than 100,000

FY 2011 Income Statement Highlights

Twelve Months Ended December 31, 2010

Twelve Months Ended December 31, 2011

as reported

comparablebasis, nonGAAP

as reported

as reported

Total operating revenues

$601,285

$680,418

$766,360

27%

Total operating expenses (before nonrecurring items)

(394,167)

(473,300)

(537,293)

36%


(394,167)

(473,300)

(643,675)

63%

220,854

220,854

246,715

12%

36.7%

32.5%

32.2%

220,854

220,854

140,334

36.7%

32.5%

18.3%

145,731

145,731

152,561

5%

$0.93

$0.93

$0.97

4%

145,731

145,731

53,118

-64%

$0.93

$0.93

$0.34

-63%

(US$ 000’s except per share data)

Adjusted OIBDA Adjusted OIBDA margin OIBDA OIBDA margin Adjusted net income attributable to CTC Media, Inc. stockholders Adjusted diluted earnings per share Net income attributable to CTC Media, Inc. stockholders Diluted earnings per share

-36%

Change comparablebasis, nonGAAP 13% 14% 36% 12%

-36%

5% 4% -64% -63%

42

FY 2011 Balance Sheet and Cash Flow Highlights

Consolidated Balance Sheet Highlights

Consolidated Cash Flow Highlights


Twelve months ended December 31, 2010


(US$ mln)

(US$ mln)

Cash and cash equivalents

59.6

12.3

Short-term investments

117.5

117.2

Total assets

997.7

893.1

including goodwill

244.8

164.4

including broadcasting licenses

163.8

159.4

including programming rights

170.7

199.1

218.9

197.1

-

16.9

794.6

697.2

1

Working capital Total debt

Stockholders’ equity

Cash at beginning of period

84.4

59.6

185.6

115.8

(250.5)

(358.6)

(130.5)

(54.6)

including acquisition of busineses

(23.8)

(25.0)

including CapEx

(29.9)

(19.8)

(79.8)

(115.0)

59.6

12.3

(29.9)

(19.8)

4.4%

2.6%

155.6

96.0

Net cash provided by operating activities including acquisition of progr. and sublic. rights

Net cash used in investing activities

Net cash used in financing activities Cash at end of period CapEx CapEx as % of total revenue

2

Net cash position

Notes:

177.0

112.6

3

Free cash flow

(1) Working capital = current assets - current liabilities (2) Net cash position = cash and cash equivalents + short-term investments - total debt (3) Free cash flow = cash flow from operating activities - acquisitions of property and equipment and intangible assets

Twelve months ended December 31, 2011

43

Reconciliation of Non-GAAP Measures Reconciliation of consolidated adjusted OIBDA and other adjusted financial measures to consolidated OIBDA and other corresponding GAAP financial measures

OIBDA (US$ 000’s except per share data) Three months ended September 30, 2012 Adjusted non-US GAAP results Impact of impairment loss Results as reported (under US GAAP, except for OIBDA which is a non-US GAAP financial measure)

Income tax expense

Net income (loss) attributable to CTC Media, Inc. stockholders

Fully diluted earnings per share

$43,366 (82,503)

($123,554) (82,503)

$38,455 (82,503)

$41,722 (82,503)

($14,501) 16,501

$27,522 (66,002)

$0.17 (0.41)

($39,137)

($206,057)

($44,048)

($40,781)

$2,000

($38,480)

($0.24)

OIBDA (US$ 000’s except per share data) Three months ended September 30, 2011 Adjusted non-US GAAP results Impact of impairment loss Results as reported (under US GAAP, except for OIBDA which is a non-US GAAP financial measure)

Total operating Operating expenses income (loss)

Income (loss) before income tax and noncontrolling interest

Total operating Operating expenses income (loss)


Income tax expense

Net income (loss) attributable to CTC Media, Inc. stockholders


$ 48,141 (16,843)

($116,217) (16,843)

$ 43,361 (16,843)

$ 46,988 (16,843)

($16,237) 3,369

$ 29,867 (13,474)

$ 0.19 (0.09)

$ 31,298

($133,060)

$ 26,518

$ 30,145

($12,868)

$ 16,393

$ 0.10

44

Reconciliation of Non-GAAP Measures

Reconciliation of consolidated adjusted OIBDA and other adjusted financial measures to consolidated OIBDA and other corresponding GAAP financial measures

(US$ 000’s except per share data)

Twelve Months Ended December 31, 2011 Adjusted non-US GAAP results Impact of impairment loss Results as reported (under US GAAP, except for OIBDA which is a non-US GAAP financial measure)

OIBDA


Operating income (loss)


$246,716

($537,293)

$ 229,067

$ 243,301

(106,382)

(106,382)

(106,382)

(106,382)

$140,334

($643,675)

$ 122,685

$ 136,919

Adjusted non-US GAAP results

$87,382

($96,460)

$84,047

$87,585

Impact of non-cash intangible asset impairment charge

(18,739)

(18,739)

(18,739)

(18,739)

Impact of Stock-based compensation expense related to settlement of litigation against former executive

(28,588)

(28,588)

(28,588)

(28,588)

Results as reported (under US GAAP, except for OIBDA, which is a non-GAAP financial measure)

$163,929

($353,638)

$152,475

$148,645

Adjusted non-US GAAP results

$280,241

($94,636)

$92,712

$74,266

Impact of non-cash impairment of intangible assets of DTV, Kz and Moldova

(232,683)

(232,683)

(232,683)

(232,683)

$47,558

($327,319)

($139,971)

($158,417)

Income tax expense

($83,342)

Net income (loss)


$ 152,561

$ 0.97

(99,443)

(0.63)

($76,403)

$ 53,118

$ 0.34

($20,759)

$64,466

$0.41

3,748

(14,991)

(0.10)

-

(28,588)

(0.18)

($45,626)

$100,389

$0.64

($1,653)

$64,635

$1.11

30,331

(153,679)

(0.97)

$28,678

($89,044)

$0.14

6,939

Three months ended December 31, 2009

Three months ended December 31, 2008

Results as reported (under US GAAP, except for OIBDA)

45

Reconciliation of Non-GAAP Measures (continued) Reconciliation of consolidated OIBDA to consolidated operating income USD mln Operating income (loss) Add: depreciation and amortization OIBDA

Q3 2012

Q3 2011

9M 2012

9M 2011

FY 2011

FY 2010

FY 2009

FY 2008

FY 2007

FY 2006

FY 2005

FY 2004

(44,048)

26,518

55,045

124,191

122,685

207,118

152,475

34,181

193,061

154,313

90,187

62,559

(4,911)

4,780

15,051

12,925

17,649

13,736

11,454

13,379

27,361

19,651

13,920

7,962

(39,137)

31,298

70,096

137,116

140,334

220,854

163,929

47,560

220,422

173,964

104,107

70,521

Reconciliation of consolidated OIBDA margin to consolidated operating income margin USD mln Operating margin Add: depreciation and amortization as percentage of revenue OIBDA margin

Q3 2012 Q3 2011 9M 2012 9M 2011 FY 2011 FY 2010 FY 2009 FY 2008 FY 2007 FY 2006 FY 2005 FY 2004 -27.2% 16.6% 10.2% 23.4% 16.0% 34.4% 30.1% 5.3% 40.9% 41.6% 38.0% 40.2% -3.0%

3.0%

2.8%

2.5%

2.3%

2.3%

2.3%

2.1%

5.8%

5.3%

5.8%

5.1%

-24.2%

19.6%

13.0%

25.9%

18.3%

36.7%

32.4%

7.4%

46.7%

46.9%

43.8%

45.3%

Reconciliation of comparable-basis, non-GAAP total operating revenues to total operating revenues USD mln Comparable-basis total operating revenues Agency commission fees payable to Video International in connection with Russian advertising sales (excluding commissions for regional advertising sales to local clients) Total operating revenues

2004 180,639

2005 273,352

2006 427,091

2007 532,143

2008 729,629

2009 574,107

2010 680,418

(25,072) (35,875) (56,257) (60,087) (89,458) (67,994) (79,133)

155,567

237,477

370,834

472,056

640,171

506,113

601,285

46

Contact Information and Disclaimer

For further information please visit www.ctcmedia.ru or contact: Ekaterina Ostrova Director, Corporate Communications and Investor Relations Tel: +7 (495) 783 3650

Irina Klimova Senior Manager, Investor Relations Tel: +7 (495) 981 0740

E-mail: [email protected]

DISCLAIMER  The information contained in this presentation, including market data that are attributed to specific sources and have not been independently verified. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. None of the Company or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation.  The presentation is not an offer of securities for sale in the United States. Neither the presentation nor any copy of it may be taken or transmitted into or distributed in the United States of America or to any U.S. person within the meaning of Regulation S under the United States Securities Act of 1933, as amended (the “Securities Act”).  This presentation is not a public offer or advertisement of securities in the Russian Federation, and is not an offer, or an invitation to make offers, to purchase any securities in the Russian Federation.  Certain statements in this presentation that are not based on historical information are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, among others, statement regarding Russian advertising market growth; advertising expenditures in different segments in Russia, increase of time spent online in Russia, availability of Company’s content on new platforms and others. These statements reflect the Company's current expectations concerning future results and events. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of CTC Media to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The potential risks and uncertainties that could cause actual future results to differ from those expressed by forward-looking statements include, among others, changes in the size of the Russian television advertising market; the continued successful operation of the Company’s own internal sales house structure; depreciation of the value of the Russian ruble compared to the US dollar; the Company’s ability to deliver audience share, particularly in primetime, to its advertisers; free-to-air television remaining a significant advertising forum in Russia; and restrictions on foreign involvement in the Russian television business. These and other risks are described in the "Risk Factors" section of CTC Media's annual report on Form 10-K filed with the SEC on February 28, 2012 and our recently report on Form 10-Q filed with the SEC on August 7, 2012. Other unknown or unpredictable factors could have material adverse effects on CTC Media's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed herein may not occur. You are cautioned not to place undue reliance on these forward-looking statements. CTC Media does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise.

47