Private Media Group (PRVT)

Three months ended March 31, 2009 compared to the three months ended March 31, 2008

Net sales. For the three months ended March 31, 2009, we had net sales of EUR 5.8 million compared to net sales of EUR 5.3 million for the three months ended March 31, 2008, an increase of EUR 0.6 million. The increase was the result of increased Internet sales offset by decreases in sales of DVD & Magazines, broadcasting and wireless.

Internet sales increased EUR 1.9 million to EUR 3.0 million, which represents an increase of 162% compared to the same period last year. The increase in Internet sales was the result of the acquisition of GameLink. DVD & Magazine sales decreased EUR 0.8 million, or 38%, to EUR 1.4 million. The reduction in DVD & Magazine sales was primarily attributable to an industry wide decrease in DVD sales (see discussion under Outlook below). Broadcasting sales decreased EUR 0.4 million, or 28%, to EUR 0.9 million primarily as a result of a decrease in title sales, offset by increases in TV-channel sales and video on demand sales via IPTV. Wireless sales decreased by EUR 0.1 million to EUR 0.5 million in the period.

Going forward, we expect Internet, wireless and Broadcasting sales to increase (see discussion under Outlook below).

Cost of Sales. Our cost of sales was EUR 3.6 million for the three months ended March 31, 2009 compared to EUR 3.4 million for the three months ended March 31, 2008, an increase of EUR 0.2 million, or 5%.

Included in cost of sales is Internet, broadcasting and wireless cost. printing, processing and duplication and amortization of library. Internet, broadcasting and wireless cost was EUR 1.5 million for the three months ended March 31, 2009 compared to EUR 0.5 million for the three months ended March 31, 2008. Internet, broadcasting and wireless cost as a percentage of related sales

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in the period was 34% compared to 17% in the same period last year. The increase was primarily the result of an increase in Internet cost of EUR 1.3 million as a result of the acquisition of GameLink, offset by lower wireless and broadcasting cost as result of more cost efficient content delivery. Printing, processing and duplication cost was EUR 0.6 million for the three months ended March 31, 2009 compared to EUR 1.3 million for the three months ended March 31, 2008, a decrease of EUR 0.7 million, or 50%. Printing, processing and duplication cost as a percentage of DVD & Magazine sales was 45% for the three months ended March 31, 2009 compared to 56% in the same period last year. Amortization of library was EUR 1.4 million for the three months ended March 31, 2009 compared to EUR 1.6 million for the three months ended March 31, 2008, which represents a decrease of EUR 0.2 million. Amortization of library does not vary with sales since it reflects the amortization of our investments in content which has been available for sale for a period of three to five years.

Gross Profit. In the three months ended March 31, 2009, we realized a gross profit of EUR 2.2 million, or 39% of net sales compared to EUR 1.9 million, or 35% of net sales for the three months ended March 31, 2008. The increase in gross profit as a percentage of sales was primarily the result of reduced margins on DVD & Magazine sales.

Selling, general and administrative expenses. Our selling, general and administrative expenses were EUR 3.6 million for the three months ended March 31, 2009 compared to EUR 3.3 million for the three months ended March 31, 2008, an increase of EUR 0.3 million, or 11%. The acquisition of GameLink added EUR 1.0 million which was offset by EUR 0.8 million in reduced selling, general and administrative expenses in all other areas except bad debt provision, which increased by EUR 0.1 million.

Operating loss. We reported an operating loss of EUR 1.4 million for the three months ended March 31, 2009 compared to an operating loss of EUR 1.4 million for the three months ended March 31, 2008.

Interest expense. We reported interest expense of EUR 0.1 million for the three months ended March 31, 2009, compared to EUR 0.1 million for the three months ended March 31, 2008.

Income tax benefit. We reported income tax benefit of EUR 0.6 million for the three months ended March 31, 2009, compared to EUR 0.6 million for the three months ended March 31, 2008.

Net loss. We reported a loss of EUR 0.8 million for the three months ended March 31, 2009, compared to EUR 0.8 million for the three months ended March 31, 2008.