Organization and Group Structure

The ProSiebenSat.1 Group is one of the largest independent media corporations in Europe. Free TV financed by advertising is our core business. We reach around 42 million TV households with our TV stations in Germany, Austria, and Switzerland. We have tapped into a dynamically growing business area with the distribution of our free TV stations in HD quality. ProSiebenSat.1 hereby participates in the technical service fees that end customers pay to providers of cable, satellite and IPTV. We are also Germany’s leading online seller of video content on the internet. Our digital portfolio includes the biggest German video-on-demand portal, maxdome. We are active in the online games business and operate an attractive, rapidly growing e-commerce portfolio. We also own Starwatch Entertainment, an independent music label. With the Red Arrow Entertainment Group, we produce international TV programs and sell them to TV stations and platform providers worldwide. It is our goal to further develop the ProSiebenSat.1 Group to a leading Broadcasting, Digital Entertainment and Commerce Powerhouse.

Management and Control

The organizational structure of the ProSiebenSat.1 Group did not change materially in 2014, either structurally or legally. We report in detail about changes to the scope of consolidation in the corresponding chapter of the Group management report and the notes. The enterprise is managed centrally by the holding company ProSiebenSat.1 Media AG.

ProSiebenSat.1 Media AG is the parent company of the ProSiebenSat.1 Group and is headquartered in Unterföhring near Munich. It is listed in Germany at the stock exchange in Frankfurt am Main and at the stock exchange in Luxembourg (Bourse de Luxembourg). As a stock corporation under German law, the Company has three principal governing bodies: the Annual General Meeting, the Executive Board, and the Supervisory Board. The governing bodies’ decision-making powers are strictly demarcated from each other:

Corporate Governance structure of the ProSiebenSat.1 Media AG as of December 31, 2014

• The shareholders of ProSiebenSat.1 Media AG exercise their rights of joint administration and oversight at the Annual General Meeting. Since the merger of the share classes into voting registered common shares in August 2013, each share grants the same legal rights and obligations and one vote in the Annual General Meeting.
• The Executive Board is responsible for the ProSiebenSat.1 Group’s overall performance, and has both professional and disciplinary authority over the managers of the various business segments and holding company units.
• The Supervisory Board monitors and advises the Executive Board in its conduct of business, and is thus directly involved in all corporate decisions of major importance.

The basic rules for this dual management system are defined in ProSiebenSat.1 Media AG’s articles of incorporation and in the rules of procedure for the Executive Board and Supervisory Board. The articles of incorporation also define the corporate objective. According to Section 179 of the German Stock Corporation Act (AktG), they may only be amended by a majority resolution of the Annual General Meeting. We report on personnel changes in the boards in the “To Our Shareholders” section.

In order to facilitate a stronger international alignment of the digital business, ProSiebenSat.1 Media AG announced on October 15, 2014, that it intends to change its legal form to a European Company (Societas Europaea/SE). The conversion will not affect the rights of the employees and the shareholders. The entity will continue to operate with a dualistic system consisting of the Executive Board and the Supervisory Board. The Annual General Meeting on May 21, 2015, is to decide on the change in legal form to a SE. The completion of the conversion is planned for the summer of 2015. As a result, shareholders of ProSiebenSat.1 Media AG will automatically become shareholders in the future ProSiebenSat.1 Media SE. The listing of the Company’s shares will remain unaffected by this measure; the Company’s registered office will continue to be in Unterföhring near Munich.

Corporate Structure and Investments

The present consolidated financial statements include ProSiebenSat.1 Media AG and all significant subsidiaries — meaning entities in which ProSiebenSat.1 Media AG directly or indirectly holds a majority of voting rights, or whose significant activities it is otherwise able to steer. In its function as the Group holding company, ProSiebenSat.1 Media AG has no operational role. Its tasks include central financing, Group risk management and the ongoing development of the corporate strategy. The economic development of the ProSiebenSat.1 Group is determined primarily by the subsidiaries, held both directly and indirectly.

One of the most important direct subsidiaries of ProSiebenSat.1 Media AG is ProSiebenSat.1 TV Deutschland GmbH. Under its umbrella, all German TV stations of the ProSiebenSat.1 Group work together. In terms of structure, ProSiebenSat.1 Media AG differs considerably from other German TV companies. Not only does the Company indirectly own all shares in the TV stations SAT.1, ProSieben, kabel eins, sixx, SAT.1 Gold, and ProSieben MAXX, it also indirectly holds a 100 % stake in the sales companies SevenOne Media GmbH and SevenOne AdFactory GmbH. This results in advantages with regard to the stations’ programming and the sale of advertising time. The companies in the Online and Games (ProSiebenSat1. Digital GmbH), Travel (ProSieben Travel GmbH), and Ventures (SevenVentures GmbH) areas are also affiliated indirectly with ProSiebenSat.1 Media AG via subsidiaries consolidated under ProSiebenSat.1 Digital & Adjacent GmbH. The subsidiaries for the Content Production & Global Sales segment operate as the Red Arrow Entertainment Group, also a 100 % holding of ProSiebenSat.1 Media AG.