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INNOVATION

UNIVISION COMMUNICATIONS INC

Annual Report 2010


SPONSORS Sponsors 1 Sponsors 1 Sponsors 1 Sponsors 1 Sponsors 1

EXECUTIVE OFFICERS Joe Uva Andrew Hobson Doug Kranwinkle Peter Lori Cesar Conde

MEMBERS OF THE BOARD Joe Uva Andrew Hobson Doug Kranwinkle Peter Lori Cesar Conde Joe Uva Andrew Hobson Doug Kranwinkle Peter Lori Cesar Conde Joe Uva Andrew Hobson Doug Kranwinkle Peter Lori Cesar Conde Joe Uva Andrew Hobson Doug Kranwinkle Peter Lori Cesar Conde


We look forward to working together to expand on a legacy of quality INNOVATION

service and performance in 2011 to further our mission to inform entertain and empower


DEAR UNIVISION STAKEHOLDERS We’re proud to report that 2010 was a year in which Univision reached new milestones and broke down barriers. Over the course of the year, we were strategic, innovative and nimble – and as a result, we further strengthened the foundation of our Company, both financially and operationally, to ensure Univision’s continued long-term growth. Our business is grounded in our mission to inform, entertain and empower U.S. Hispanics, and there is no dispute of the fact that Univision is the #1 brand among Hispanic Americans, with a connection to and understanding of this diverse community unlike any other company in the U.S. today. We have built this relationship and become a cornerstone of Hispanic American culture during our 50-year legacy, making us the preferred gateway for reaching this growing demographic. With our unique positioning, accomplishments of the past year and talent of our world-class team, we are better equipped than ever to continue to deliver on these

port the power of the U.S. Hispanic consumer group. For many advertisers, Hispanic consumers and Univision represent one of the best growth markets with the most untapped potential. We increasingly see marketers shift share of their overall spend to Spanish-language broadcast from our English-language competitors as they recognize the vital business imperative for growth that reaching the Hispanic market represents. We are confident that this trend will prevail and we will continue to receive outsized benefits from the recovery of the ad markets into this year as 2010 Census results are released. As the growth of the U.S. Hispanic Community continues to skyrocket, so too will the growth of Univision. For Univision one of the most significant milestones of 2010, which will help secure Univision’s leadership in the years to come and continue to serve the needs of Hispanic America, was the evolution of our strategic partnership with Televisa. Through an agreement in which Televisa made a substantial investment

For Univision one of the most significant milestones of 2010 which will help secure Univision’s leadership in the years to come and continue to serve the needs of Hispanic America was the evolution of our strategic partnership with Televisa goals while also providing our clients with a unique offering: the key to tapping into the nation’s fastest-growing consumer group. The continuing growth trajectory of the U.S. Hispanic community is staggering. Between 1980 and 2009 the number of Spanishspeakers in the U.S. grew by more than 219% and the forthcoming 2010 U.S. Census results are expected to indicate that the Hispanic population exceeds 50 million – roughly the size of the entire population of South Africa or Spain and greater than that of South Korea. With such significant scale, the U.S. Hispanic community has reached a critical mass and marketers are taking note. Hispanic Americans represent more than $1 trillion and counting in purchasing power, a number that classifies this demographic as the 15th largest consumer market in the world) and wield more political, cultural and economic influence in the United States than ever before. There is certainly no lack of extremely compelling data to sup1

in Univision, the long-term Program License Agreement (PLA) between our two companies was significantly expanded and extended. The transaction marked an important step forward in our partnership that fully aligned the interests of our companies and better positioned Univision and our advertisers to leverage the substantial growth opportunities in U. S. Hispanic media. The new PLA, which provides Univision with unrestricted rights to Televisa’s world class content portfolio through at least 2025, has no limitations on the platforms (including online, mobile and VOD) or the amount of content that can be exploited by Univision. Securing the world’s best Spanish-language programming through this partnership and the parallel in-house productions of Univision Studios has and will continue to offer numerous benefits to our audience, clients and employees while firmly establishing Univision as the preferred multi-platform media destination for the U.S. Hispanic community for the foreseeable future. The Televisa transaction was also transformative for Univision from


a financial perspective. In addition to the financial upside of the expanded and extended PLA, Televisa’s $1.2 billion investment in Univision has enabled the Company to take important steps to strengthen our balance sheet and enhance overall financial flexibility. With new cash, Univision was able to amend and extend our bank credit facilities, thereby securing longer-term access to capital that the Company needs to realize future growth. We could not be more pleased with the outcome of these transactions. Univision’s debt refinancing was completed successfully and on terms that exceeded our expectations during the fourth quarter of 2010, and we look forward to leveraging the full potential of our reinvigorated strategic partnership going forward to better serve our audience and achieve additional growth. The significant enhancement of Univision’s financial profile in 2010 was also driven by strong and consistently improving quarterly results. [INSERT FULL YEAR FINANCIAL HIGHLIGHTS WHEN AVAILABLE]. In addition we continue to realize incre-

magazine as one of the “World’s Most Innovative Companies” for 2011 in large part because of the strides we have made in staying on the cutting edge of the media industry, making a unique impact on our audiences and bringing the incredible influence of Hispanic America to the forefront of public awareness. With an audience that remained loyal and attentive in 2010, our television, radio and interactive platforms continued to out-perform their respective peers and reach new heights. The Univision Network further proved itself to be a fierce competitor to the major English-language networks, maintaining its #5 spot among Adults 18-49 regardless of language for the 7th consecutive year. Univision also broke into new competitive territory, topping charts with its first full week as #1 among all Adults 18-49 in primetime in September. The year also brought us the most highly rated Spanish-language novela in U.S. history and pushed Univision’s ratings position to #1 among broadcast networks regardless of language in all key demographics the night of its finale. Furthermore, our groundbreaking coverage of the 2010

In addition, we are proud of Univision Interactive Media (UIM) which has become the leading Spanish-language interactive content provider in the U.S. and has boasted the #1 most-visited Spanish-language website among U.S online Hispanics for nine consecutive years mental revenue from the overwhelming success of our retransmission consent negotiations [INSERT RELEVANT DETAILS].

FIFA World Cup reached more viewers on traditional and new media platforms than any event or program in Univision’s history.

Equally important to our financial performance in 2010 was the success of our Upfront selling season. The 2010 Upfront marked a significant milestone in our efforts to close the ad gap and secure our rightful share of the overall market. We closed the Upfront with impressive dollar volume growth of more than [20]%. Importantly, Univision’s organic growth totaled 14% (101 new brands added in 2010 versus 55 in 2009), which is particularly impressive when compared to the English-language networks that realized a mere 3% organic growth in the 2010 Upfront.

TeleFutura set a new high-water mark in 2010 and firmly established its position as the #2 Spanish-language network in the country in key dayparts among key demographics. And Galavisión remained the Spanish-language cable leader, having achieved double-digit audience growth in all key demographics in 2010.

In addition to the appeal of the exploding Hispanic population, our ability to grow the commitments of our existing advertisers and attract new marketers was in part due to our advancements in innovation. We were recently named by Fast Company

We also continue to excel on the local level, with Univision’s Los Angeles television station ranking as the #1 most-watched station in America regardless of language among Adults 18-34. Our 62 television stations and 70 radio stations nationwide are the key connectors to our communities and serve a crucial role in each component of our mission. In addition, we are proud of Univision Interactive Media (UIM), 2


Over the course of the year we were strategic innovative and nimble and as a result we further strengthened the foundation of our Company both financially and operationally to ensure Univision’s continued long-term growth Our business is grounded in our mission to inform entertain and empower U.S. Hispanics and there is no dispute of the fact that Univision is the #1 brand among Hispanic Americans with a connection to and understanding of this diverse community unlike any other company in the U.S. today.


Importantly Univision’s organic growth totaled 14% {101 new brands added in 2010 versus 55 in 2009}

which is particularly impressive when compared to the English-language networks that realized a mere 3% organic growth in the 2010 Upfront.


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