Consolidated Annual Accounts 2017

Atresmedia Corporación de Medios de Comunicación, S.A. and Subsidiaries Translation of consolidated financial statements originally issued in Spanish and prepared in accordance with the regulatory financial reporting framework applicable to the Group in Spain (see Notes 2 and 29). In the event of discrepancy, the Spanish-language version prevails. 2017 CONSOLIDATED FINANCIAL STATEMENTS 35 Fully amortised intangible assets in use at 31 December 2017 amounted to EUR 178,614 thousand (2016: EUR 276,022 thousand). Disposals or reductions of audiovisual productions in 2017 relate mainly to the sale of fully amortised audiovisual cinema productions not in use, which generated a gain of EUR 877 thousand. There were no impairments of intangible assets in 2017. In 2016, the impairment of intangible assets amounted to EUR 1,301 thousand, related to the impairment of audiovisual cinema productions. The existence of impairment was determined based on an analysis of the related investment through a case-by-case assessment of the value in use of each film, taking into account updated estimates of the revenue produced in each commercial exploitation window, recognising, where necessary, an impairment loss under “Programme amortisation and other procurements” since the impairment relates to cinema productions shown on television channels. For the licence, since this asset has an indefinite useful life, a recoverability assessment was performed at year-end. 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 Parent and updated in accordance with the performance of the advertising markets. The measurement of this licence is included in the “Television” CGU. Taking the correlation between the advertising market and the trend of domestic demand and private consumption as a reference, a retrospective analysis was conducted using the historical data of these two variables, based on market consensus. These future projections cover the next five years. The discount rate used to measure this intangible asset in 2017 was 9.0% (2016: 9.5%). A perpetual growth rate of 1.0% was used. The sensitivity analysis shows that a 1.0% increase in the perpetual growth rate gives rise to an increase in value of EUR 77 million, while a decrease of 1.0% gives rise to a decrease of EUR 60 million. Similarly, a 1.0% increase in the discount rate gives rise to a decrease of EUR 111 million, and a 1.0% decrease in the discount rate gives rise to an increase of EUR 143 million. The changes in value used in all these sensitivity analyses would not reduce the recoverable amount to below the carrying amount.