Consolidated Annual Accounts 2017

Atresmedia Corporación de Medios de Comunicación, S.A. 2017 FINANCIAL STATEMENTS 30 The most representative acquisitions and sales of ownership interests in other entities and other significant corporate transactions in 2016 were as follows: - on 15 January 2016, the Company acquired a 50% ownership interest in the share capital of Atres Hub Factory, S.L. for EUR 244 thousand. The latter's company object was the creation of digital businesses related to audiovisual content. - in November 2016 the Company formalised the sale and transfer to its subsidiary Atres Advertising, S.L. Unipersonal its entire ownership interest in Guadiana Producciones, S.A. Unipersonal, generating a loss of EUR 7 thousand. - in December 2016 the Company contributed capital of EUR 331 thousand to its subsidiary Flooxplay, S.L. Unipersonal and EUR 99 thousand to its subsidiary Atresmedia Música, S.L. Unipersonal. These transactions did not result in a change in the percentage of ownership. None of Atresmedia Corporación de Medios de Comunicación, S.A.’s investees are listed on Spanish or foreign stock exchanges. At the end of each year or period, the directors assess the business plans of the Company’s investees, revise them if necessary and estimate the value of the ownership interests and the recoverability of the investments made. For Uniprex, S.A. Unipersonal, the key assumptions on which the cash flow projections are based relate mainly to advertising markets (the data relate to scenarios used by market participants to set prices, based on a consensus among analysts, who are independent third parties, employed by the industry in general), audience figures, advertising efficiency ratios and cost forecasts. Except for advertising, which is measured on the basis of external information sources, the rest of the assumptions are based on past experience and reasonable projections approved by management of the Company and updated in accordance with the performance of the advertising markets. These future projections cover the next five years. The cash flows for the years not considered in the projections are estimated to be perpetual, with growth of 1%. In assessing value in use, the estimated cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the assets. To calculate the rate, the current time value of money and the risk premiums generally used by analysts for the business and geographical area (Spain) are taken into account, giving rise to future discount rates of 9.5% in 2017 and 2016. The Company also performs sensitivity analyses when there are reasonably possible changes in the key assumptions used to calculate the recoverable amounts of the radio CGU. In this respect, the sensitivity analyses are prepared under various scenarios on the basis of the variables deemed most significant, i.e. advertising revenue, which depend mainly on the performance of the advertising market and the investment share, and the discount rate. The sensitivity analysis conducted demonstrates that an increase in the perpetuity growth rate of 1.0% would give rise to an increase in value of EUR 17 million, whereas a decrease in the perpetuity growth rate of 1.0% would give rise to a decrease in value of EUR 14 million. Also, a 1.0% decrease in the discount rate would give rise to an increase of EUR 23 million, and a 1.0% increase in the discount rate would give rise to a decrease of EUR 18 million. The changes in value used in all these sensitivity analyses would not reduce the recoverable amount to below the carrying amount. For investments for which business plans are not available, impairment is estimated on the basis of the company’s equity and the unrealised gains or losses at the end of the year or period. In 2017, the Company recognised net losses on reversals and impairment of financial instruments totalling EUR 5,934 thousand (2016: net gains of EUR 9,902 thousand). The amounts recognised included, inter alia , impairment of EUR 4,836 thousand related to investments in available-for-sale financial assets (mainly I-neumáticos and Myrlana Capital)