Interim Management Statement

Entertainment One Ltd.

Interim Management Statement

Entertainment One Ltd. presents its Interim Management Statement for the ten month period to 31 January 2014.

§ Reported revenues for the period increased by 56%, driven by growth in both Film and Television, with pro forma revenues for the period up 7.5% on a constant currency basis

§ Gross margins also increased, with improvements in both Film and Television driven by the continued increase in investment returns and cost synergies following the Alliance acquisition

§ Investment in content and productions was higher during the period, with a strong schedule of film releases and television programming in place for the new financial year

§ Full year earnings are expected to be ahead of management expectations

Overview

The Group continued to enjoy a strong financial year, with reported revenues in the period up 56% on prior year, and pro forma revenues up 7.5% on a constant currency basis. Group digital revenues continued to perform well, more than doubling against the same period in the prior year, representing 20% of Group revenues.

Gross margins were higher, with improvements in both Film and Television driven by the continued increase in investment returns and cost synergies following the Alliance acquisition.

Investment in content and productions for the full year is expected to increase in line with management expectations, up more than 30% year-on-year (2013 pro forma: £206 million), driven by increased investment across both Film and Television.

Full year earnings are expected to be ahead of management expectations.

Film

The 2013/14 financial year has been a period of consolidation and growth for the Company's Film division. The integration of the Alliance business is substantially complete, with synergies ahead of original expectations. eOne is now the largest film distributer in Canada and the largest independent film distributer in the UK, Spain and the Benelux.

Film revenues for the period were 65% ahead of the prior year (3.5% on a pro forma constant currency basis). The Group released 235 films theatrically in the ten month period to 31 January 2014, compared to 167 in the previous year (194 on a pro forma basis).

Theatrical releases have included Now You See Me, The Hunger Games: Catching Fire, American Hustle, Prisoners, Philomena, The Butler, Rush, Behind the Candelabra and 12 Years a Slave. DVD releases numbered almost 500 and included Now You See Me, Django Unchained, Red 2, The Impossible, 2 Guns, Safe Haven, The Silver Linings Playbook, Nativity 2: Danger in the Manger! and Bullet to the Head.

The Group expects to release around 270 films during the current financial year and looking forward continues to increase investment in film content through its low-risk portfolio approach. Next year's slate includes theatrical releases of The Expendables 3, The Hunger Games: Mockingjay Part 1, Tarzan, Pompeii, Divergent, The Hundred Foot Journey and Nativity 3. This will further drive the value of the Group's film library, and help improve operating margins and cash flows by exploiting film content through eOne's global network.

The Group continues to expand the Film division's international and production businesses: Insidious 2 was released during the period, delivering significant box office revenues, Suite Française and The Woman in Black: Angels of Death are in post-production and further productions are currently in active development, including Sinister 2 and Insidious 3.

Television

The Television division has had a strong period of growth, with revenues 34% higher than the same period last year.

Television Production output was higher, with 240 half hours delivered against 217 half hours in the prior year period. Full year programme deliveries are expected to be in line with management expectations. Key deliveries to date have included renewals for season two of Saving Hope, season three of Hell on Wheels and season four of Haven. New shows have included Klondike, the Discovery Channel's first scripted mini-series, which helped drive Discovery Channel to deliver its most-watched Monday primetime to-date and best ever month for viewership, and Bitten, which premiered on Syfy and Space. The pipeline of programming in the next financial year includes a 22-episode season five of Rookie Blue and a 26-episode season five of Haven.

From an international perspective, the Television division has signed an exclusive three-year television output deal with US-based AMC Networks, with first programme deliveries expected in the next financial year, and an exclusive worldwide distribution deal with El Rey Network. Upcoming shows from AMC include Halt and Catch Fire, Turn and The Red Road.

Peppa Pig continues to perform strongly in the UK and in Europe, where it has become the number one pre-school show in Italy, as well as in further afield markets including Russia and Latin America. Peppa is now the largest pre-school property on Nick Jr. in the US and continues to enjoy a daily primetime slot on the network. Next month sees the launch of the first Peppa Pig DVD in America, which will ship to key retailers including Wal-Mart, Target and Toys'R'Us, and a range of Peppa merchandise is now available online with Wal-Mart.

Family saw positive developments for its other established property during the period with Ben and Holly's Little Kingdom winning the pre-school category at the recent International Emmy Kids Awards. In addition, a new animated show for 6-12 year olds, Winston Steinburger and Sir Dudley Ding Dong, is to be developed by eOne for broadcast in association with Teletoon Canada and ABC3 Australia.

So-So Happy, the Group's teen brand, was launched in Wal-Mart Canada before Christmas and a new So-So Happy cosmetics deal has recently been signed.

The Music business has had a strong period with revenues higher than the prior year and chart success with five songs in the top 20 on the BDS Gospel Radio Chart in January 2014.

Financing

The Group's operating cash flows were higher year-on-year supporting the increased investment in content and productions. Net debt at the end of the ten month period to 31 January 2014 was higher than the 31 March 2013 year end position reflecting higher investment in content and productions during the period and, together with the Group's net asset position, remains in line with management expectations.

Corporate

The performance criteria of the Company's out-performance incentive plan, as set out in the Company's AIM Admission Document dated 29 March 2007, were met on 6 February 2014 and, consequently, the total amount of £5 million, which was previously accrued in the financial results to 31 March 2013 has been paid in cash to the executive directors, in line with the plan rules.

Outlook

The directors remain confident in the outlook for the Company and expect earnings for the financial year to be ahead of management expectations. The directors expect to announce the commencement of a progressive dividend policy at the time of the Company's year end results announcement.

Notes to Editors:

About Entertainment One

Entertainment One Ltd. (LSE:ETO) is a leading international entertainment company that specialises in the acquisition, production and distribution of film and television content. The Company's comprehensive network extends around the globe including Canada, the US, the UK, Ireland, Spain, Benelux, France, Germany, Scandinavia, Australia, New Zealand, South Africa and South Korea.

The Company provides extensive expertise in film distribution, television and music production, family programming and merchandising and licensing. Its current rights library is exploited across all media formats and includes more than 35,000 film and television titles, 2,800 hours of television programming and 45,000 music tracks.

Further information is available at www.entertainmentone.com or email Redleaf Polhill at [email protected].