Consolidated Annual Report for 2025

Polsot

Letter of the Chairman of the Supervisory Board of Cyfrowy Polsat S.A. Letter of the President of the Management Board of Cyfrowy Polsat S.A. Consolidated Financial Statements for the year ended December 31, 2025

Report of the independent auditor on the audit of the consolidated financial statements for the year ended December 31, 2025

Report of the Management Board on the activities of Cyfrowy Polsat S.A. and Cyfrowy Polsat S.A. Capital Group for the financial year ended December 31, 2025

Independent statutory auditor's limited assurance report on sustainability reporting for the financial year ended December 31, 2025

Statement of the Management Board Statement of the Supervisory Board

Ladies and Gentlemen,

The report presented to you summarises the activities of Polsat Plus Group in 2025. It was a demanding period, shaped both by macroeconomic factors and by internal challenges, which had a material impact on the conditions under which the Group conducted its business.

Despite the unfavourable macroeconomic environment, the Group consistently pursued initiatives aimed at maintaining operational and financial efficiency across its key areas of activity: telecommunications, content production and distribution, and green energy. In 2025, particular emphasis was placed on responsible financial management, which is of key importance in the context of preparations for the future refinancing of debt. Consistent cost control is also one of the Management Board's primary objectives this year.

The year 2025 can clearly be described with one word: "continuity". The Group focused on the implementation of the Strategy 2023+ and the objectives arising from it. A significant proportion of these

objectives were achieved, which opens the way for the Management Board to present new strategic assumptions and future development directions for the Group as early as 2026.

At the end of 2025, important changes were also made to the corporate bodies of the companies within the Group. A new President of the Management Board took office at the turn of the year, and the first effects of his actions are expected to become visible gradually over the course of the current year. As Chairman of the Supervisory Board, I am pleased to note the initiatives undertaken to date which, in line with the Management Board's declarations, translated into an improvement in operational and financial results in the first quarter of 2026.

Polsat Plus Group operates, among others, in the media and telecommunications sectors, which are driven by the dynamic development of modern technologies. Their effective, flexible and responsible implementation and use will be one of the key factors influencing the Group's competitiveness and long-term development. For the Group's future, the completion of the investment cycle related to the implementation of the objectives of the Strategy 2023+ in the area of clean energy production is also of significance.

At the same time, the Supervisory Board declares its full readiness and commitment to supporting the Management Board and the employees of Polsat Plus Group in the development and implementation of a new strategy as well as in the further development of corporate governance policies and the strengthening of the Group's organisational culture. I would like to emphasise that the involvement of employees and management in shaping the new strategy will be a significant factor determining the effectiveness of its implementation in the future.

On behalf of the Supervisory Board of Cyfrowy Polsat, I would like to express my gratitude to the Group's employees for their commitment and professionalism, to our customers for their trust and for using the Group's services and products, and to our shareholders and investors for their confidence and long-term support.

Yours faithfully, Daniel Kaczorowski

Chairman of the Supervisory Board, Cyfrowy Polsat S.A.

Ladies and Gentlemen,

I am pleased to present to you Polsat Plus Group's annual report for 2025, which also includes the sustainability report.

The past year was a period of numerous challenges and a difficult macroeconomic environment. The Group continued the implementation of its Strategy 2023+ across its core business segments: telecommunications, media and green energy.

The Group worked on strengthening the foundations of its business, including the bundled services offering. Activities focused, among others, on the process of selecting and combining services such as fibre broadband, television, mobile internet, mobile subscriptions and streaming services. An increasing number of customers are using Plus's 5G network, which now covers 26 million people, representing 70% of the country's population. Polsat Box continued to enhance its range of TV services delivered via the internet, a distribution channel that is gaining importance year by year.

In the media segment, we delivered very strong results in both television and online markets. Thanks to an attractive programme schedule and a strong portfolio of sports broadcasting rights, TV Polsat channels were the audience ratings leader, and our TV advertising revenues increased. At the same time, Polsat-Interia Group was the largest online publisher in Poland.

We are finalising our strategic investments in the green energy segment. In total, we have 485 MW of installed generation capacity in renewable energy sources, including wind, solar and biomass.

Despite the challenging macroeconomic environment, we achieved stable financial results. Group revenues exceeded PLN 14.3 billion, while adjusted EBITDA amounted to over PLN 3.1 billion. Our priority going forward will be even more effective cash flow management and stricter cost control.

Already in the first quarter of 2026, with viewers seeking modern ways of accessing entertainment in mind, we significantly expanded the offering of our Polsat Box Go streaming service. It now provides access to nearly 200 TV channels, including a comprehensive selection of sports and news channels, as well as a wide range of films, series and programmes. As a result, it offers a unique combination of traditional television, a rich VOD library and the convenience associated with streaming services.

In March 2026, we introduced a new offer for Plus and Polsat Box customers, who will be the only ones on the market to have access to five of the world's leading streaming services. In addition to Disney+, HBO Max and SkyShowtime, Apple TV and Amazon Prime have joined the offer. In this way, Plus and Polsat Box have become a unique and the largest aggregator of global streaming services on the Polish market, available at an attractive price.

The year 2026 began with changes in the Group's organisation, as well as in its supervisory and management bodies. I am fully aware of market expectations regarding the announcement of a new strategy and future plans for the Group, which we intend to present to the market in a comprehensive manner in autumn this year. This does not mean, however, that we are waiting until then. Immediately after taking over leadership of the Management Board, we launched initiatives that are already delivering positive cost, sales and, consequently, financial effects. My objective is to manage the Group in such a way that after reviewing every part of our business - a process that is currently under way - we can determine which areas require only

minor adjustments, which need more significant changes in approach and which will be fundamental to building value and shaping the future of the entire Polsat Plus Group.

The results achieved by our Group are the outcome of the hard work of the entire team. I would like to sincerely thank all employees for their full commitment, professionalism and sense of responsibility in their day-to-day work. I would also like to thank our shareholders and financial partners for their trust. I greatly appreciate and thank our customers and viewers for their loyalty. Their everyday choice of our services and programmes motivates us to continue our efforts and to further improve our offering.

Yours faithfully,

Piotr Żak

President of the Management Board, Cyfrowy Polsat S.A.

This document is a conversion to pdf format of the official consolidated financial statements issued in xhtml format.

Table of contents

Approval of the Consolidated Financial Statements 4

Consolidated Income Statement 5

Consolidated Statement of Comprehensive Income 6

Consolidated Balance Sheet 7

Consolidated Cash Flow Statement 9

Consolidated Statement of Changes in Equity 11

Notes to the Consolidated Financial Statements for the year ended 31 December 2025 13

General information 13

1. The Parent Company 13

2. Composition of the Management Board of the Company 13

3. Composition of the Supervisory Board of the Company 14

4. Basis of preparation of the consolidated financial statements 14

5. Group structure 15

   Principles applied in the preparation of financial statements 24

6. Accounting and consolidation policies 24

7. Determination of fair values 42

8. Approval of the Consolidated Financial Statements 43

   Explanatory notes 43

9. Revenue 43

10. Operating costs 44

11. Finance income 45

12. Finance costs 45

13. Income tax 46

14. EBITDA (unaudited) 50

15. Basic and diluted earnings per share 50

16. Property, plant and equipment 51

17. Goodwill 53

18. Brands 53

19. Impairment test (including goodwill and intangible assets with indefinite useful life) 55

20. Customer relationships and other intangible assets 58

21. Right-of-use assets 62

22. Programming assets 64

23. Investment property 65

24. Deferred distribution fees 65

25. Non-current receivables and other non-current assets 66

26. Loans granted 66

27. Contract assets and liabilities 67

28. Inventories 67

29. Trade and other receivables 68

30. Other current assets 68

31. Cash and cash equivalents 69

32. Equity 70

33. Hedge valuation reserve 74

34. Loans and borrowings 76

35. Issued bonds 84

36. Lease liabilities 85

37. Group as a lessor 86

38. Other non-current liabilities and provisions 87

39. Trade and other payables 87

    Other notes 89

40. Acquisition of subsidiaries 89

41. Financial instruments 92

42. Capital management 114

43. Operating segments 115

44. Barter transactions 119

45. Transactions with related parties 120

46. Contingent liabilities 122

47. Remuneration of the Management Board 125

48. Remuneration of the Supervisory Board 126

49. Important agreements and events 127

50. Events subsequent to the reporting date 132

51. Other disclosures 132

52. Judgments, financial estimates and assumptions 133

    Financial results for the 3 months ended 31 December 2025 and 31 December 2024 141

53. Consolidated Income Statement 141

54. Consolidated Statement of Comprehensive Income 142

55. Revenue 142

56. Operating costs 143

57. Finance income 144

58. Finance costs 144

‌Approval of the Consolidated Financial Statements

On 28 April 2026, the Management Board of Cyfrowy Polsat S.A. approved the consolidated financial statements of Cyfrowy Polsat S.A. Capital Group prepared in accordance with International Financial Reporting Standards as adopted by the European Union, which include:

Consolidated Income Statement for the period

from 1 January 2025 to 31 December 2025 showing a net loss for the period of: PLN 2,602.6

Consolidated Statement of Comprehensive Income for the period

from 1 January 2025 to 31 December 2025 showing a total comprehensive loss for the period of:

PLN 2,653.1

Consolidated Balance Sheet as at

31 December 2025 showing total assets and total equity and liabilities of: PLN 35,269.1

Consolidated Cash Flow Statement for the period

from 1 January 2025 to 31 December 2025 showing a net increase in cash and cash equivalents amounting to:

PLN 528.1

Consolidated Statement of Changes in Equity for the period

from 1 January 2025 to 31 December 2025 showing a decrease in equity of: PLN 2,662.7

Notes to the Consolidated Financial Statements

The consolidated financial statements have been prepared in million of Polish zloty ('PLN') except where otherwise indicated.

Piotr

Żak

President of the Management Board

Maciej

Stec

Vice-President of the Management Board

Andrzej

Abramczuk Member of the Management Board

Bartłomiej

Drywa

Member of the Management Board

Jacek

Felczykowski Member of the Management Board

Agnieszka

Odorowicz Member of the Management Board

Katarzyna

Ostap-Tomann Member of the Management Board

Warsaw, 28 April 2026

‌Consolidated Income Statement

Continuing operations

for the year ended Note 31 December 2025 31 December 2024

Revenue, includes: 9 14,323.6 14,265.9

Financing component of revenue from installment sales

177.9 189.0

‌Consolidated Statement of Comprehensive Income

:

Share of other comprehensive income of subsidiaries and associates

(0.7) (1.0)

Other comprehensive income/(loss), net of tax (50.5) (0.5)

Total comprehensive income/(loss) attributable to equity holders of the Parent

Total comprehensive income/(loss) attributable to non-controlling interest

(2,601.6) 710.2

(51.5) 66.6

‌Consolidated Balance Sheet - Assets

Consolidated Balance Sheet - Equity and Liabilities

Other non-current liabilities and provisions, includes:

38 384.3 301.6

Effect of exchange rate fluctuations on cash and cash equivalents

1.2 (9.3)

Cash and cash equivalents at the end of the period 3,216.4(3) 2,687.1(1)

* Includes amount paid for costs related to the new financing.

(1) Includes restricted cash amounting to PLN 34.1.

(2) Includes restricted cash amounting to PLN 19.7.

(3) Includes restricted cash amounting to PLN 33.2.

‌Consolidated Statement of Changes in Equity

(1) In accordance with the provisions of the Commercial Companies Code, joint-stock companies are required to transfer at least 8% of their annual net profits to reserve capital until its amount reaches one third of the amount of their share capital. As at 31 December 2025 the capital excluded from distribution amounts to PLN 8.5.

Consolidated Statement of Changes in Equity

(1) In accordance with the provisions of the Commercial Companies Code, joint-stock companies are required to transfer at least 8% of their annual net profits to reserve capital until its amount reaches one third of the amount of their share capital. As at 31 December 2024 the capital excluded from distribution amounts to PLN 8.5.

‌Notes to the Consolidated Financial Statements for the year ended 31 December 2025

‌General information

Name of reporting entity or other means of

identification: Cyfrowy Polsat S.A.

Domicile of entity: Poland

Legal form of entity: joint stock company

Country of incorporation: Poland

Address of entity's registered office: Łubinowa 4a, 03-878 Warsaw

Principal place of business: Poland

1. ‌The Parent Company

   Cyfrowy Polsat S.A. ('the Company', 'Cyfrowy Polsat', 'the Parent Company', 'the Parent') was incorporated in Poland as a joint stock company. The Company's shares are traded on the Warsaw Stock Exchange. The Parent Company's registered office is located at 4a, Łubinowa Street in Warsaw.

   The Parent operates in Poland as a provider of a paid digital satellite platform under the name of 'Polsat Box' and paid digital terrestrial television as well as telecommunication services provider.

   The Company was incorporated under the Notary Deed dated 30 October 1996.

   These consolidated financial statements comprise the Parent and its subsidiaries ('the Group') and joint ventures. The Group operates in four segments:

   • B2C and B2B services which relates mainly to the provision of services to the general public, including digital television transmission signal, Internet access services, mobile TV services, online TV services, mobile services, production of set-top boxes,

   • media which consist mainly of production, acquisition and broadcasting of information and entertainment programs as well as TV series and feature films broadcasted on television channels in Poland,

   • real estate segment, which mainly includes the implementation of construction projects as well as the sale, rental and management of own or leased real estate,

   • green energy segment, which mainly includes production and sale of energy from renewable sources, construction of a complete hydrogen-based value chain as well as investments in projects focused on the production of energy from photovoltaics and wind farms.

2. ‌Composition of the Management Board of the Company

   • Piotr Żak President of the Management Board (since 23 December 2025),

   • Mirosław Błaszczyk President of the Management Board

     (until 21 July 2025),

   • Maciej Stec Vice-President of the Management Board,

   • Andrzej Abramczuk Member of the Management Board

     (since 29 December 2025),

     President of the Management Board

     (since 22 July 2025 until 23 December 2025),

   • Bartłomiej Drywa Member of the Management Board (since 29 December 2025),

   • Jacek Felczykowski Member of the Management Board,

   • Aneta Jaskólska Member of the Management Board (until 1 April 2026),

   • Agnieszka Odorowicz Member of the Management Board,

   • Katarzyna Ostap-Tomann Member of the Management Board.

3. ‌Composition of the Supervisory Board of the Company

   • Daniel Kaczorowski Chairman of the Supervisory Board (since 22 July 2025),

   • Zygmunt Solorz Chairman of the Supervisory Board (until 21 July 2025),

   • Aleksandra Żak Vice-Chairman of the Supervisory Board

     (since 29 December 2025),

   • Tobias Solorz Vice-Chairman of the Supervisory Board

     (since 29 December 2025),

   • Justyna Kulka Vice-Chairman of the Supervisory Board

     (until 30 October 2025),

   • Marek Grzybowski Member of the Supervisory Board,

   • Alojzy Nowak Member of the Supervisory Board,

   • Józef Birka Member of the Supervisory Board (until 29 December 2025),

   • Jarosław Grzesiak Member of the Supervisory Board (since 29 December 2025),

   • Piotr Muszyński Member of the Supervisory Board (since 29 December 2025),

   • Marta Poślad Member of the Supervisory Board (since 29 December 2025),

   • Tomasz Szeląg Member of the Supervisory Board.

4. ‌Basis of preparation of the consolidated financial statements

   Statement of compliance

   These consolidated financial statements for the year ended 31 December 2025 have been prepared in accordance with the International Financial Reporting Standards as adopted by the EU (IFRS EU). The Group applied the same accounting policies in the preparation of the financial data for the year ended 31 December 2025 and the consolidated financial statements for the year 2024 presented in the consolidated annual report, except for the change in accounting policies relating to hedge accounting as described below and for the EU-endorsed standards and interpretations which are effective for the reporting periods beginning on or after 1 January 2025.

   During the year ended 31 December 2025 the following become effective:

   • Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability.

     Amendments and interpretations that apply for the first time in 2025 do not have a material impact on the consolidated financial statements of the Group.

     Standards published but not yet effective:

   • Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments -Disclosures: Classification and Measurement of Financial Instruments,

   • Annual improvements (volume 11) - includes clarifications, simplifications, corrections and changes of IFRS standards: IFRS 1 First-time Adoption of International Financial Reporting Standards, IFRS 7 Financial Instruments - Disclosures, IFRS 9 Financial Instruments, IFRS 10 Consolidated Financial Statements, IAS 7 Statement of Cash Flows,

   • Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments -Disclosures - Contracts Referencing Nature-dependent Electricity - changes in assessment of own use, hedge accounting and disclosure requirements,

   • IFRS 18 Presentation and Disclosure in Financial Statements,

   • IFRS 19 Subsidiaries without Public Accountability: Disclosures,

   • Amendments to IFRS 19 - Subsidiaries without Public Accountability - Disclosures,

   • Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Translation to the presentation currency in hyperinflationary conditions.

   The Group has not early adopted the new or amended standards in preparing these consolidated financial statements.

   Change in accounting policies - implementation of IFRS 9 "Financial Instruments" in the scope of hedge accounting

   As of 1 January 2025, the Group has changed its accounting policies for recognizing and presenting hedging transactions, changing from the principles set out in IAS 39 "Financial Instruments: Recognition and Measurement" ("IAS 39") to the hedge accounting model in accordance with IFRS 9 "Financial Instruments" ("IFRS 9").

   Until 31 December 2024, the Group, pursuant to the transitional provisions of IFRS 9, continued to apply hedge accounting principles consistent with IAS 39, despite the earlier implementation of the remaining requirements of IFRS 9.

   In accordance with the transitional provisions of IFRS 9, the amendment was applied prospectively from 1 January 2025. The Group did not restate comparative data for earlier periods. The impact of the change in accounting policies on the consolidated financial statements as of 1 January 2025 was immaterial and did not require adjustments to the opening balances or recognition of the effects of the transition in the equity.

5. ‌Group structure

   These consolidated financial statements for the year ended 31 December 2025 include the following entities:

   Share in voting rights (%)*

   Entity's registered

   office

   Activity 31 December

   2025

   31 December

   2024

   Parent Company:

   Cyfrowy Polsat S.A.

   Łubinowa 4a, 03-878 Warsaw

   radio, TV and telecommunication

   activities

   n/a n/a

   Subsidiaries accounted for using full method:

   Telewizja Polsat Ostrobramska 77, television
   broadcasting and	100%	100%
   Sp. z o.o. 04-175 Warsaw production
   Polsat Media Ostrobramska 77, media	100%	100%
   Alte Landstrasse 17, Polsat License Ltd. 8863 Buttikon, media	100%	100%

   Sp. z o.o. 04-175 Warsaw

   Switzerland

   Polsat Investments Ltd.

   3, Krinou Agios Athanasios, 4103 Limassol,

   Cyprus 238A King Street,

   media 100% 100%

   Polsat Ltd. W6 0RF London, media United Kingdom	100%	100%
   naEKRANIE.pl Fabryczna 5a, media	100%	60%

   Sp. z o.o.(g)

   00-446 Warsaw

   4FUN Sp. z o.o.(f)

   Fabryczna 5a, 00-446 Warsaw

   media 100% 60%

   INFO-TV-FM Łubinowa 4a, radio and TV 100%				100%
   Polkomtel Sp. z o.o. Konstruktorska 4, telecommunication 100%				100%
   Al. Stanów Liberty Poland S.A. Zjednoczonych 61, telecommunication 100% activities				100%
   04-028 Warsaw other activities Polkomtel Business Konstruktorska 4, supporting financial Development 02-673 Warsaw services, gaseous 100%				100%
   Sp. z o.o.		fuels trading
   		activities
   	Level 2 West,
   	Mercury Tower, Elia
   Orsen Holding Ltd.	Zammit Street, St.	holding activities	100%	100%
   	Julian's STJ 3155,
   	Malta
   	Level 2 West,
   	Mercury Tower, Elia
   Orsen Ltd.	Zammit Street, St.	holding activities	100%	100%
   	Julian's STJ 3155,
   	Malta
   	Al. Stanów
   Dwa Sp. z o.o.	Zjednoczonych 61,	holding activities	100%	100%
   	04-028 Warsaw

   Sp. z o.o.

   03-878 Warsaw

   activities

   02-673 Warsaw activities

   Interphone Service Sp. z o.o.

   Teleaudio Dwa Sp. z o.o. Sp.k.

   Inwestorów 8,

   39-300 Mielec

   Al. Stanów Zjednoczonych 61,

   04-028 Warsaw

   production of set-

   top boxes

   call center and premium rate

   services

   100% 100%

   100% 100%

   IB 1 FIZAN Zjednoczonych 61A, financial activities ** 04-028 Warsaw Al. Stanów telecommunication Sferia S.A. Zjednoczonych 61A, activities 51%		** 51%
   Al. Stanów Altalog Sp. z o.o. Zjednoczonych 61A, software 66% 04-028 Warsaw		66%
   Konstruktorska 4, management and Plus Flota Sp. z o.o. 100%		100%
   Poleczki 13, telecommunication Netia S.A. 100%		100%
   Poleczki 13, telecommunication Netia 2 Sp. z o.o. 100% 02-822 Warsaw activities		100%
   TK Telekom Kijowska 10/12A, telecommunication Sp. z o.o. 03-743 Warsaw activities 100%		100%
   Kostrogaj 3, telecommunication Petrotel Sp. z o.o. 100% 09-400 Płock activities		100%
   Eleven Sports Plac Europejski 2, media 100%		100%
   Netshare Media Ostrobramska 77, advertising 100%		100%
   Kielecka 5, TVO Sp. z o.o. retail sales 75.96%		75.96%
   Plus Finanse Konstruktorska 4, other monetary 100%		100%
   Konstruktorska 4, monetary Plus Pay Sp. z o.o. 100%		100%
   Al. Wyścigowa 6, Esoleo Sp. z o.o. technical services 100% Alledo Express Broniwoja 3/85, rental services -(c)		100% 100%
   Alledo Parts Broniwoja 3/85, wholesale	100%	100%
   Alledo Parts Broniwoja 3/85, wholesale	100%	100%
   Alledo Setup Broniwoja 3/85, technical services	100%	100%

   Al. Stanów

   04-028 Warsaw

   02-673 Warsaw rental services

   02-822 Warsaw

   activities

   Network Sp. z o.o. 00-844 Warsaw

   Group Sp. z o.o.

   04-175 Warsaw

   activities

   81-303 Gdynia

   Sp. z o.o.

   02-673 Warsaw

   intermediation

   02-673 Warsaw

   intermediation

   02-681 Warsaw

   Sp. z o.o.(c)

   02-655 Warsaw

   Sp. z o.o.

   02-655 Warsaw

   Sp. z o.o. Sp.k.

   02-655 Warsaw

   Sp. z o.o.

   02-655 Warsaw

   Alledo Setup Broniwoja 3/85, technical services	100%	100%
   Grupa Interia.pl Os. Teatralne 9a, holding activities	100%	100%

   Sp. z o.o. Sp.k. 02-655 Warsaw

   Sp. z o.o.

   31-946 Cracow

   Os. Teatralne 9a,

   Interia.pl Sp. z o.o.(e)

   31-946 Cracow

   web portals activities

   100% 100%

   Mobiem Polska Sp. z o.o. in liquidation(d)

   Fabryczna 5a, 00-446 Warsaw

   holding activities -(d) 100%

   Fabryczna 5a,

   Mobiem Sp. z o.o.

   00-446 Warsaw

   advertising activities

   100% 100%

   TV Spektrum Sp. z o.o.

   Ostrobramska 77,

   04-175 Warsaw

   media 100% 100%

   Polot Media Sp. z o.o.

   Ludwika Solskiego 55,

   52-401 Wroclaw

   consulting 60% 60%

   Polot Media Sp. z o.o. Sp.k.

   Ludwika Solskiego 55,

   52-401 Wroclaw

   movie and TV production

   60% 60%

   Rakowiecka 41/21,

   BCAST Sp. z o.o.(b)

   02-521 Warsaw

   telecommunication

   activities

   95.01% 80.01%

   Polsat Talenty Ostrobramska 77, cooperation with Sp. z o.o. 04-175 Warsaw artists and 100%	100%
   Al. Stanów Premium Mobile Zjednoczonych 61A, telecommunication 100% 04-028 Warsaw	100%
   Łubinowa 4A, Stork 5 Sp. z o.o. holding activities 100%	100%
   Łubinowa 4A, agricultural Swan 5 Sp. z o.o. 100%	100%
   Al. Stanów Vindix S.A. Zjednoczonych 61A, 100% services	100%

   presenters

   Sp. z o.o. activities

   03-878 Warsaw

   03-878 Warsaw

   activities

   other financial

   04-028 Warsaw

   Vindix Investments Sp. z o.o.

   Direct Collection Sp. z o.o.

   	79018, Lviv	services
   Vindix NSFIZ	Al. Stanów Zjednoczonych 61A,	financial services	**	**
   	04-028 Warsaw
   Mag7soft Sp. z o.o.	Al. Stanów Zjednoczonych 61A,	software activities	100%	100%
   	04-028 Warsaw

   Vindix Sp. z o.o.

   Al. Stanów Zjednoczonych 61A, 04-028 Warsaw

   Al. Stanów Zjednoczonych 61A, 04-028 Warsaw

   Heroiv UPA 73 ż,

   other financial

   services

   other financial

   services call center

   100% 100%

   100% 100%

   100% 100%

   Port Praski Sp. z o.o.

   Port Praski Nowe Inwestycje

   Sp. z o.o.

   Port Praski Office Park Sp. z o.o.

   Port Praski City Sp. z o.o.

   Port Praski City III Sp. z o.o.

   Port Praski City IV Sp. z o.o.

   Port Praski

   Sp. z o.o. S.K.A.

   Port Praski Education Sp. z o.o.

   Port Praski Doki Sp. z o.o.

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   implementation of

   construction

   projects

   real estate management

   implementation of

   construction

   projects implementation of

   construction

   projects implementation of

   construction

   projects implementation of

   construction

   projects implementation of

   construction

   projects implementation of

   construction

   projects implementation of

   construction

   projects

   66.94% 66.94%

   66.94% 66.94%

   77.52% 77.52%

   77.52% 77.52%

   77.52% 77.52%

   77.52% 77.52%

   77.52% 77.52%

   77.52% 77.52%

   77.52% 77.52%

   Port Praski Doki II Sp. z o.o.

   Port Praski Media Park Sp. z o.o.

   Port Praski II Sp. z o.o.

   Port Praski Hotel

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   03-711 Warsaw

   Krowia 6,

   implementation of

   construction

   projects implementation of

   construction

   projects implementation of

   construction

   projects

   77.52% 77.52%

   77.52% 77.52%

   77.52% 77.52%

   Sp. z o.o.

   Pantanomo Limited

   Laris Investments Sp. z o.o.

   Laris Development

   03-711 Warsaw

   3 KRINOU,

   Limassol 4103,

   Cyprus

   Pańska 77/79, 00-834 Warsaw

   Pańska 77/79,

   hotel services 77.52% 77.52%

   holding activities 77.52% 77.52%

   real estate rental 66.94% 66.94% implementation of

   Sp. z o.o.

   Laris Technologies Sp. z o.o.

   Megadex Expo Sp. z o.o.

   Centrum Zdrowia i

   00-834 Warsaw

   Pańska 77/79, 00-834 Warsaw

   Adama Mickiewicza 63,

   01-625 Warsaw

   Sikorskiego 8,

   construction

   projects

   property rental

   and management

   property rental

   and management

   66.94% 66.94%

   66.94% 66.94%

   66.94% 66.94%

   Relaksu Verano

   Sp. z o.o. Oktawave S.A.

   78-100 Kołobrzeg

   Poleczki 13,

   02-822 Warsaw

   hotel services 66.94% 66.94%

   website

   100% 100%

   management

   Sarmacka 12C/14,

   Antyweb Sp. z o.o.

   02-972 Warsaw

   web portal activities

   79.88% 79.88%

   PAK-Polska Czysta Energia Sp. z o.o.

   PAK-PCE Człuchów Sp. z o.o

   Eviva Drzeżewo Sp. z o.o.

   Kazimierska 45,

   62-510 Konin

   Kazimierska 45,

   62-510 Konin

   Kazimierska 45,

   62-510 Konin

   holding

   50.5% 50.5%

   activity

   production of 50.5% 50.5% electricity

   production of 50.5% 50.5% electricity

   Kazimierska 45,

   PCE OZE 1 Sp. z o.o.

   62-510 Konin

   Kazimierska 45,

   PCE OZE 2 Sp. z o.o.

   62-510 Konin

   production of electricity

   production of electricity

   50.5% 50.5%

   50.5% 50.5%

   Kazimierska 45, production of PCE OZE 3 Sp. z o.o. 50.5%	50.5%
   Kazimierska 45, production of PCE OZE 4 Sp. z o.o. 50.5%	50.5%
   Kazimierska 45, production of PCE OZE 6 Sp. z o.o. 50.5%	50.5%
   Exion Hydrogen Ku Ujściu 19, manufacture of Polskie Elektrolizery electrical 50.4%	50.4%

   62-510 Konin

   electricity

   62-510 Konin

   electricity

   62-510 Konin electricity

   Sp. z o.o.

   Exion Hydrogen Belgium BV

   PAK-PCE

   80-701 Gdańsk

   Slachthuisstraat 120, bus 12,

   2300 Turnhout

   Belgium

   Kazimierska 45,

   equipment

   manufacture of

   electrical equipment

   production of

   50.4% 50.4%

   Fotowoltaika

   Sp. z o.o.

   62-510 Konin Al. Stanów

   electricity 50.5% 50.5%

   PAK-VOLT S.A. Zjednoczonych 61A, trade of electricity 50.5% 04-028 Warsaw	50.5%
   PG Hydrogen Konstruktorska 4, manufacture of engines and 26.26%	26.26%
   PAK-PCE Biopaliwa i Przemysłowa 158, production of 50.5%	50.5%
   PAK-PCE Wiatr Kazimierska 45, production of 50.5%	50.5%
   PAK-PCE Polski Kazimierska 45, manufacture of Autobus Wodorowy 50.5% 62-510 Konin buses	50.5%
   PAK-PCE Stacje H2 Kazimierska 45, retail of hydrogen 50.5%	50.5%
   PAK-PCE Przyrów Częstochowska 7A, production of 50.5%	50.5%
   PAK-PCE Dobra Kazimierska 45, production of 50.5%	50.5%
   PAK-PCE Kazimierz Kazimierska 45, production of 50.5%	50.5%
   Al. Wojska PAK-PCE Miłosław Polskiego 68, production of 50.5% 70-479 Szczecin	50.5%
   Global Continental Kazimierska 45, production of 50.5%	50.5%

   Sp. z o.o.

   02-673 Warsaw

   turbines

   Wodór Sp. z o.o.

   62-510 Konin

   electricity

   Sp. z o.o.

   62-510 Konin

   electricity

   Sp. z o.o.

   Sp. z o.o. 62-510 Konin

   Sp. z o.o.

   42-428 Przyrów

   electricity

   Sp. z o.o.

   62-510 Konin

   electricity

   Biskupi Sp. z o.o.

   62-510 Konin

   electricity

   Sp. z o.o. electricity

   Sp. z o.o.

   62-510 Konin

   electricity

   implementation of Port Praski Medical Postępu 14, construction	77.52%	77.52%
   projects
   implementation of construction	77.52%	77.52%
   projects
   Warszawska 222B, Archiplex Sp. o.o.(a) archive	100%	-
   Al. Stanów movie, video and

   Center Sp. z o.o. 02-676 Warsaw

   Port Praski City II Sp. z o.o.

   Postępu 14,

   02-676 Warsaw

   26-617 Radom

   Dystrybucja Mówi Serwis Sp. z o.o.(h)

   Zjednoczonych 61,

   04-028 Warsaw

   television programme distribution

   100% -

   * including direct and indirect shares

   ** Cyfrowy Polsat S.A. indirectly holds 100% of certificates

   (a) On 17 January 2025, Cyfrowy Polsat S.A. purchased 100% of the shares of Archiplex Sp. z o.o.

   (b) On 24 January 2025, Cyfrowy Polsat S.A. acquired an additional 10% of shares in BCAST Sp. z o.o. Following this transaction, Cyfrowy Polsat S.A. held 90.01% of shares. On 18 July 2025 Cyfrowy Polsat S.A. acquired an additional 5% of shares in BCAST Sp. z o.o. Following this transaction, Cyfrowy Polsat S.A. holds 95% of shares.

   (c) On 31 January 2025, Esoleo Sp. z o.o. sold 100% of the shares of Alledo Express Sp. z o.o.

   (d) On 7 March 2025, the court decided to remove Mobiem Polska Sp. z o.o. in liquidation from the National Court Register.

   (e) On 2 December 2025, Telewizja Polsat Sp. z o.o. acquired 2 shares in Interia.pl Sp. z o.o. After this transaction, Telewizja Polsat Sp. z o.o. holds 100% of shares in the company.

   (f) On 9 December 2025, Polsat Investments Ltd. acquired 40% of shares in 4Fun Sp. z o.o. Following this transaction, Polsat Investments Ltd. holds 100% of shares in the company.

   (g) On 9 December 2025, Polsat Investments Ltd. acquired a 40% shares in naEkranie.pl Sp. z o.o. Following this transaction, Polsat Investments Ltd. holds 100% of the shares in the company.

   (h) On 11 December 2025, Telewizja Polsat Sp. z o.o. acquired 100% of shares in Dystrybucja Mówi Serwis Sp. z o.o.

   Investments accounted for under the equity method:

   Share in voting rights (%)*

   Polski Operator

   Entity's registered

   office

   Wiertnicza 166,

   Activity 31 December

   2025

   31 December

   2024

   Telewizyjny Sp. z o.o.

   02-952 Warsaw

   technical services 50% 50%

   Polsat Boxing Promotion Sp. z o.o.(a)

   Pollytag S.A.

   * including indirect shares

   Ostrobramska 77,

   04-175 Warsaw

   Wielopole 6,

   80-556 Gdańsk

   movie and TV production

   sale of wood and construction materials

   24% 24%

   31.12% 31.12%

   (a) On 20 February 2026, Telewizja Polsat Sp. z o.o. acquired 76% of shares in Polsat Boxing Promotion Sp. z o.o. Following this transaction Telewizja Polsat Sp. z o.o. holds 100% shares in the company.

   Additionally, the following entities were included in these consolidated financial statements for the year ended 31 December 2025:

   	Entity's registered Activity 31 December	31 December
   	office 2025	2024
   Karpacka Telewizja Kablowa Sp. z o.o.(1)	Warszawska 220, dormant 99%	99%
   Polskie Badania Internetu Sp. z o.o.(2)	Al. Jerozolimskie web portals 65/79, 00-697 activities 21.43%	21.43%
   Pluszak Sp. z o.o.	Domaniewska 47, retail sales 9%	9%
   Towerlink Poland Sp. z o.o.	Marcina Kasprzaka telecommunication 0.01%	0.01%
   Megadex SPV Sp. z o.o.	Adama Mickiewicza other financial 7.02%	7.02%
   Stocznia Remontowa NAUTA	Budowniczych 10, repair and maintenance of 0.03%	0.03%

   Share in voting rights (%)

   26-600 Radom

   Warsaw 02-672 Warsaw

   4, 01-211 Warsaw activities

   63, 01-625 Warsaw

   services

   S.A.

   Asseco Poland S.A.(3)

   Neo Energia Przykona X Sp. z o.o.

   81-336 Gdynia

   Olchowa 14,

   35-322 Rzeszów

   Franciszka Klimczaka 1,

   02-797 Warsaw

   Franciszka

   ships and boats

   software activities -(3) 10.13%

   other consulting 0.51% 0.51%

   Energia Przykona

   Sp. z o.o.

   Klimczaka 1,

   02-797 Warsaw

   electricity

   distribution

   0.51% 0.51%

   (1) Investment accounted for at cost less any accumulated impairment losses.

   (2) Not included in investments accounted for under the equity method due to immateriality.

   (3) On 31 January 2025, Cyfrowy Polsat S.A. sold 8,300,029 (not in millions) shares of Asseco Poland S.A., representing 9.99% of the share capital of Asseco Poland S.A. On 5 February 2025, Cyfrowy Polsat S.A. sold 105,298 (not in millions) shares of Asseco Poland S.A. Following this transaction, Cyfrowy Polsat S.A. no longer holds any shares of Asseco Poland S.A.

   ‌Principles applied in the preparation of financial statements

6. ‌Accounting and consolidation policies

The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements by all entities within the Group.

1. Basis of measurement

   The consolidated financial statements have been prepared on the historical cost basis, except for derivative financial instruments, which are stated at fair value and other financial instruments valued at fair value through profit or loss.

2. Going concern

   These consolidated financial statements have been prepared assuming that the Group's entities will continue as a going concern in the foreseeable future, not shorter than 12 months from 31 December 2025.

3. Functional and presentation currency

   These consolidated financial statements are presented in the Polish zloty, rounded to million, the Group's functional currency.

4. Use of estimates and judgments

   The preparation of consolidated financial statements in conformity with EU IFRS requires the Management Board to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and costs. Estimates and underlying assumptions are based on historical data and other factors considered as reliable under the circumstances, and their results provide grounds for an assessment of the carrying amounts of assets and liabilities which cannot be based directly on any other sources. Actual results may differ from those estimates.

   The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about critical estimates and judgments in applying accounting policies is included in note 52.

5. Comparative financial information

   Comparative data or data presented in previously published financial statements has not been updated.

6. Basis of consolidation

   Subsidiaries

   Subsidiaries are entities controlled by the Parent. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

   The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

   The financial statements of subsidiaries are prepared for the same period as the financial statements of the Company and using the accounting policies that are consistent with those of the Company for like transactions and events.

   Equity transactions between a parent entity and the non-controlling interests are treated as transactions between shareholders, provided that the transactions do not result in a change of control. No gains or losses are recognised in consolidated profit or loss for transactions

   between the parent entity and the non-controlling interest, unless control is lost. Transactions where control is not lost are recorded within equity.

   Put options granted in business combinations to holders of non-controlling interest in the subsidiary (i.e. obligating the Group to acquire non-controlling interests in particular circumstances in the future for a particular price) give rise to a financial liability recognised in the consolidated balance sheet.

   While such put option remains unexercised, at the end of each reporting period the Group determines the amount of non-controlling interest (including share of profit/losses attributable to the non-controlling interest), de-recognises the controlling interest as if was acquired at that balance sheet date and recognises a financial liability measured at present value of the redemption amount. The difference is accounted for as a transaction between a parent entity and the non-controlling interests as described above.

   On expiry of an unexercised put option the Group derecognises the financial liability in full and recognises non-controlling interest as if the put option was never granted.

   Associates and Joint arrangements

   Associates are all entities over which the Group has significant influence but not control or joint control, over the financial and operating policies. This is generally the case where the Group hold between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method.

   The Group applies IFRS 11 to all joint arrangements. Under IFRS 11 investments in joint arrangements are classified as either joint operations or joint ventures depending on the contractual rights and obligations of each investor. The Group has assessed the nature of its joint arrangements and determined them to be joint ventures. Joint ventures are accounted for using the equity method.

   Under the equity method of accounting, the investments are initially recognised at cost and adjusted thereafter to recognise the Group's share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group's share of losses in an equity-accounted investment equals or exceeds its interests in the entity (which includes any long term interests that, in substance, form part of the Group's net investment), the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associates or joint venture.

   Unrealised gains on transactions between the Group and its associates and joint ventures are eliminated to the extent of the Group's interest in these entities. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of the equity accounted investees have been changed where necessary to ensure consistency with the policies adopted by the Group.

   Transactions eliminated on consolidation

   Intra-group balances and transactions, and any unrealised gains and losses or income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

   Unrealised gains arising from transactions with associates and joint ventures are eliminated against the investment to the extent of the Group's interest in the entity. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

   Business combinations under common control

   IFRS 3 scopes out business combinations under common control and is not prescriptive otherwise as to the method of accounting for such transactions.

   The Group assessed that in case of the acquisition of control over Port Praski Group it acquired control over significant processes including the development of construction projects as well as the sale, rental and management of owned or leased properties. Moreover, the expenditures and processes significantly lead to Port Praski Group's ability to generate results. In light of the above it was determined that the acquisition method as defined in IFRS 3 is appropriate to account for the acquisition of control over Port Praski Group.

   In case of the transaction of acquiring control over PAK-PCE Group, the acquisition was part of the implementation of the Group's strategy (as a result of the acquisition, a new operating segment "Green Energy" was identified). This transaction was carried out at fair values, and the consideration under the transaction was paid in cash. Furthermore external parties were involved in this transaction, in case of both Cyfrowy Polsat and ZE PAK S.A. (the entity from which the PAK-PCE shares were purchased) the beneficiaries of this transaction were their non-controlling shareholders. In light of the above facts and circumstances, the Group concluded that the transaction of acquiring control over the PAK-PCE Group has economic substance, therefore the most appropriate method to account for this transaction is the acquisition method as defined in IFRS 3.

7. Foreign currency transactions

   Foreign currency transactions

   Transactions in foreign currencies are translated to the Polish zloty at exchange rates in effect one day prior to the recording of these transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to Polish zloty at the average exchange rate quoted by the National Bank of Poland ("NBP") for that date. The foreign currency exchange differences arising on translation of transactions denominated in foreign currencies and from the reporting date retranslation of monetary assets and liabilities denominated in foreign currencies are recognized in profit and loss. Non-monetary assets and liabilities in a foreign currency that are measured in terms of historical cost are translated using the average NBP exchange rate in effect at the date of the initial recognition. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated at the average NBP foreign exchange rate in effect at the date the fair value was determined.

8. Financial instruments

   Non-derivative financial instruments

   Financial assets

   Financial assets are classified in the following measurement categories depending on the business model in which assets are managed and their cash flow characteristics:

   • assets measured at amortized cost - if the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows, and the contractual terms of this financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding;

   • financial asset measured at fair value through other comprehensive income - if the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of this financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding;

   • assets measured at fair value through profit or loss - all other financial assets.

     Financial assets at initial recognition are measured at fair value plus, in the case of financial assets not measured at fair value through profit or loss, directly attributable transaction costs. Trade receivables that do not have a significant financial component are initially measured at their transaction price.

     Financial assets measured at amortized cost

     Financial assets measured at amortized cost include trade and other receivables, loans granted and cash and cash equivalents. Interest income from these financial assets is calculated using the effective interest rate method and is presented within Finance Income.

     Financial asset measured at fair value through other comprehensive income

     Financial asset measured at fair value through other comprehensive income include investments in equity instruments for which at initial recognition Group make an irrevocable election to present in other comprehensive income subsequent changes in their fair value. Gains and losses on these financial assets are never recycled to profit or loss.

     Financial assets measured at fair value through profit or loss

     Financial assets measured at fair value through profit or loss include derivative instruments not designated as hedging instruments, and equity instruments for which the Group made such choice (shares of Asseco Poland S.A.). Financial assets classified to this category are measured at fair value and the subsequent changes in their fair value are recognized in profit or loss. The subsequent changes in their fair value of derivative instruments not designated as hedging instruments are presented in Finance income or Finance costs depending on the economic substance of hedged transaction.

     A financial asset is derecognised when the contractual rights to receive cash flows from the asset have expired or the Group has transferred substantially all the risks and rewards of the asset.

     Financial liabilities

     Financial liabilities include financial liabilities measured at amortized cost and financial liabilities measured at fair value through profit or loss.

     Financial liabilities are recognised initially at fair value and, in case of financial liabilities which are not measured at fair value through profit or loss, net of directly attributable transaction costs.

     Financial liabilities measured at amortized cost

     Financial liabilities measured at amortized cost include loans and borrowings, issued bonds, trade and other payables and lease liabilities. Interest expense related to these financial liabilities is calculated using the effective interest rate method and is presented as Finance costs.

     Financial liabilities measured at fair value through profit or loss

     Financial liabilities measured at fair value through profit or loss include derivative instruments not designated as hedging instruments. Financial liabilities classified to this category are measured at fair value and the subsequent changes in their fair value are recognized in profit or loss. The subsequent changes in their fair value of derivative instruments not designated as hedging instruments are presented in Finance income or Finance costs depending on the economic substance of hedged transaction.

     A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in profit or loss. In early repayment case, the difference between the carrying amount of the repaid liability and the carrying amount of the new liability is recognized in profit or loss.

     Accounting policies related to gains and losses on investment activities and finance costs are presented in 6u.

     Derivative financial instruments

     Hedge accounting

     The Group may use derivative financial instruments such as forward currency contracts, interest rate swaps and cross-currency interest rate swaps to hedge its foreign currency and interest rate risks.

     For the purpose of hedge accounting, the Group's hedges are classified as fair value hedges and cash flow hedges when change in fair value and hedging exposure to variability in cash flows that is either attributable to a particular risk associated with a recognized asset or liability or a highly probable forecast transaction.

     At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to which the Group wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The documentation includes identification of the hedging instrument, the hedged item or transaction, the nature of the risk being hedged and how the Group will assess the effectiveness of changes in the hedging instrument's fair value in offsetting the exposure to changes in cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in cash flows and are assessed on an ongoing basis to determine that they actually have been highly effective throughout the financial reporting periods for which they were designated.

     The Group assesses the existence of an economic relationship quantitatively through a prospective effectiveness test for relationships involving IRS and CIRS instruments designated for hedge accounting. The Group designates a hypothetical derivative that reflects the parameters and changes in the value of the hedged item. Based on the selected method, the Group expects that changes in the values of the hedging instrument and the hedged item will move in opposite directions, resulting in an offsetting effect.

     Hedge ratio for the Group's hedging relationships is 1:1 due to the match between the notional value of the hedging instruments and the risk exposure designated for hedge accounting.

     For cash flow hedges the effective portion of the gain or loss on the hedging instrument is recognized directly as other comprehensive income in the hedge valuation reserve, while any ineffective portion is recognized immediately in profit or loss.

     The amounts recognized within other comprehensive income are transferred from equity to the income statement when the hedged transaction affects profit or loss, such as when the related gain or loss is recognized in Finance income or costs or when a forecasted sale occurs.

     Gains and losses from the settlement of derivative instruments that are designated as, and are effective hedging instruments, are presented in the same position as the impact of the hedged item. The derivative instrument is divided into a current portion and a non-current portion only if a reliable allocation can be made.

9. Equity

   Ordinary shares

   Incremental costs directly attributable to the issue of ordinary shares are recognized as a deduction from equity.

   Preference share capital

   Preference share capital is classified as equity, if it is non-redeemable, or redeemable only at the Company's option, and any dividends are discretionary. Dividends thereon are recognized as distributions within equity.

   Costs attributable to issue and public offering of shares

   Costs attributable to a new issue of shares are recognized in equity while costs attributable to a public offering of existing shares are recognized directly in finance costs. These costs relating to both new issue and sale of existing shares are recognized on a pro-rata basis in equity and finance costs.

   Share premium

   Share premium includes the excess of the issue value over the nominal value of shares issued decreased by share issuance-related consulting costs.

   Retained earnings

   In accordance with the provisions of article 396 of the Commercial Companies Code, joint-stock companies are required to transfer at least 8% of their annual net profits to reserve capital until its amount reaches one third of the amount of their share capital. This capital is excluded from distribution, however, it can be utilised to cover accumulated losses.

10. Property, plant and equipment and investment property

    Property, plant and equipment owned by the Group

    Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses.

    Cost includes purchase price of the asset and other expenditure that is directly attributable to the acquisition and bringing the asset to a working condition for its intended use, including initial delivery as well as handling and storage costs. The cost of purchased assets is reduced by the amounts of vendor discounts, rebates and other similar reductions received.

    The cost of self-constructed assets and assets under construction includes all costs incurred for their construction, installation, adoption, and improvement as well as borrowing costs incurred until the date they are accepted for use (or until the reporting date for an asset not yet accepted for use). The above cost also may include, if necessary, the estimated cost of dismantling and removing the asset and restoring the site.

    When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

    Investment property

    Investment property is defined as a property (land, building, or both) held by the Group to earn rentals or for capital appreciation or both.

    Investment property is also property (land) whose purpose as of balance sheet date is not specified or the investment process will not begin within three years from the balance sheet date.

    Investment property is measured initially at cost.

    Once recognized all investment property held by the Group are measured using the cost model as set out in IAS 16. This means that the assets are recognized at cost model as presented in Property, plant and equipment owned by the Group above.

    Investment property is removed from the balance sheet on disposal or when it is permanently withdrawn from use and no further economic benefits are expected from its disposal.

    Subsequent costs

    Subsequent cost of replacing a component of an item of property, plant and equipment is recognized in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Group and the amount of the cost can be

    measured reliably. Replaced item is derecognized. Other property, plant and equipment related costs are recognized in profit and loss as incurred.

    Depreciation

    Depreciation expense is based on the cost of an asset less its residual value. Significant components of individual assets are assessed and if a component has a useful life that is different from the remainder of that asset, that component is depreciated separately.

    Depreciation is recognized in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment.

    Land is not depreciated.

    The following are estimated useful lives of respective group of property, plant and equipment:

    Reception equipment	2 or 3 or 5	years
    Buildings and structures	2-61	years
    Technical equipment and machinery	2-40	years
    Vehicles	2-25	years
    Other	2-26	years

    Depreciation methods, useful lives and residual values of material assets are reviewed at each financial year-end.

    Leased assets

    Assets used under lease, tenancy, rental or similar contracts which meet lease criteria, are classified separately in the balance sheet as right-of-use assets.

    Set-top boxes, modems and routers that are provided to customers under operating lease agreements are recognized within non-current assets (reception equipment in the balance sheet) and depreciated as described in Depreciation above. The set-top boxes are depreciated over a period that exceeds the period the lease agreements are entered into.

    Carrying amounts of reception equipment and other items of property, plant and equipment as well as right-of-use assets may be reduced by impairment losses whenever there is any indication that an asset may be impaired and there is uncertainty as to those assets' revenue generating potential or their future use in the Group's operations. The accounting policies relating to impairment are presented in note 6n.

    Detailed accounting policies related to lease contracts are described in point 6v.

11. Intangible assets

    Goodwill

    Goodwill represents the excess of the sum of consideration transferred and payable, the amount of non-controlling interest in the acquiree and the fair value as at the date of acquisition of any previously held equity interest in the acquiree over the fair value of the identifiable net assets acquired.

    Goodwill is presented at purchase price less accumulated impairment losses. Goodwill is tested for impairment annually or more frequently if possible impairment is indicated. Goodwill is allocated to acquirer's cash-generating units for the purpose of testing for impairment. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose, but not higher than segment.

    Customer relationships

    Customer relationships acquired as a result of the acquisition of subsidiaries are amortized on a straight-line basis over their useful lives, i.e. over the period of 2.5 to 17.5 years.

    Brands

    Brands acquired as a result of the acquisition of subsidiaries are amortized on a straight-line basis over their useful lives, except where an indefinite period of use is justified. Brands with an indefinite useful life are tested annually for impairment or more frequently if impairment indicators exist. The estimated useful lives for respective brands are as follows:

    • Polsat, TV4, TV6 and Polo TV brands: 20 years (i.e. 2042),

    • Plus brand: 51 years (i.e. 2065),

    • Netia brand: 10 years (i.e. 2028),

    • Eleven Sports brand: 15 years (i.e. 2035),

    • Interia brand: 30 years (i.e. 2050),

    • Premium Mobile brand: 30 years (i.e. 2051),

    • 4FUN brand: 20 years (i.e. 2042),

    • naEKRANIE.pl brand: 20 years (i.e. 2042).

      Other intangible assets

      The Group capitalizes costs of IT software internally generated, including employee-related expenses, directly resulting from generating and preparing an asset to be capable of operating, if the Group is able to measure reliably the expenditure attributable to such development and when it can reliably establish the commencement as well as the completion date of the software development activities.

      Other intangible assets acquired by the Group are measured at cost less accumulated amortization and impairment losses.

      Subsequent expenditure on existing intangible assets is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is recognized in the profit or loss as incurred.

      Amortization expense is based on the cost of an asset or production cost less its residual value.

      Amortization is recognized in profit or loss on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use. The recoverable amounts of intangible assets which are not yet available for use are measured as at each balance sheet date.

      The estimated useful lives for respective intangible assets groups are as follows:

    • Computer software: 2-15 years,

    • Concessions: period resulting from an administrative decision,

    • Other: 2-15 years.

12. Programming assets

    Programming assets comprise acquired formats, licenses and copyrights for broadcasting feature films, series, news and shows, capitalized costs of commissioned external productions ordered by the Group, capitalized sports rights and advance payments made (including advance payments for sports rights).

    Initial recognition

    Programming rights, other than sports rights, are recognized at cost as programming assets when the legally enforceable license period begins and all of the following conditions have been met:

    • the cost of each program is known or reasonably determinable,

    • the program material has been accepted by the licensee in accordance with the conditions of the license agreement,

    • the program is available for its first showing.

      Capitalized costs of productions include costs of programs ordered by the Group, including productions made based on licenses purchased from third parties. Capitalized costs of productions are measured individually for each program at their respective production or acquisition costs, not to exceed their recoverable amounts.

      Sports broadcasting rights are recognized at purchased price at the time of TV transmission. Broadcasting rights to seasonal sport events, acquired under long-term contracts (frequently multi-seasonal), are recognized at the relative value determined by internal experts and allocated to each of the sport events' season as part of the purchased programming package. The Group's method of recognition of sports broadcasting rights is dependent on the type of sports channel on which the use of these rights is planned:

    • sports broadcasting rights for premium sports channels are recognized in relation to all seasons contracted by the Group at the start of the first of them,

    • sports broadcasting rights for other channels are recognized separately for each season at the start of each of them.

      Advance payments for acquired programming assets, prior to license begin date, are recognized as prepayments for programming assets.

      Signed and binding contracts for purchase of programming, which do not meet recognition criteria for programming assets are not recognized in the balance sheet and are instead disclosed as contractual commitments in the amount of the outstanding contract liability at the reporting date.

      Programming assets are classified as non-current or current based on the estimate timing of the broadcast. A programming asset is recognized as current when the expected broadcast falls within 1 year from the reporting date. Sport rights and prepayments for sport rights are classified as current or non-current based on dates of related sport events (or start of the sport season).

      Amortization

      Programming assets are amortized using the method reflecting the manner of consuming the economic benefits embodied in the licenses acquired within their estimated useful lives limited by the term of the respective license agreements.

      The depreciation method and rate depend on the asset category and the allowable number of emissions:

    • Films are amortized on a straight-line basis over the months of their broadcast, generally no more than over the first 4-10 runs (depending on the nature of the television program in which they are broadcast and the number of available runs).

    • Licenses purchased for series are amortized on a straight-line basis over the months of their broadcast, generally no more than for the first 4-5 broadcasts (depending on the nature of the television program in which they are broadcast).

    • Series produced for the Group are amortized in the months of their broadcast, depending on the television program in which they are broadcast:

      • 80% in the first broadcast and 20% in the second broadcast - for titles produced for the Polsat program;

      • 25% in each of the first 4 broadcasts - for titles produced for the TV4 program;

      • 100% in the first broadcast - for titles produced for other thematic programs.

    • Sports broadcasting rights - 100% of the right's value is recognized as an expense in the income statement at the time of the first broadcast, however acquired rights to game seasons or rights to many seasons or a series of competitions are amortized on a straight-line basis over the period between the beginning of the first season and the end of the last season in respect to sports broadcasting rights primarily intended for premium sports channels or over the duration of the season or series of competitions in respect to sports broadcasting rights intended for other channels.

    • Commissioned external productions intended for only one run are fully amortized on their first broadcast.

    • News programming is fully amortized at its first broadcast.

    • General entertainment shows are fully amortized at their first broadcast.

      Amortization of programming assets is presented in Content costs line in the operating costs of the income statement.

      Impairment

      Programming assets are reviewed for impairment at least annually and whenever there is any indication that the carrying amount may not be recoverable. Impairment losses are recognized on each license in case of withdrawal from broadcasting an item in the expected future (resulting from changes in strategic program scheduling, changing audience tastes, media law restrictions on the usability of films) or expected future losses anticipated on disposal of the rights.

      Impairment write downs on programming assets are recognized as increase in the content costs. Impairment of programming assets is reversed if the reason for the original impairment ceases to exist. The reversals are recorded as content cost reductions.

13. Inventories

    Inventories are measured at the lower of cost and net realizable value. Cost of acquisition or production cost of inventories is determined by using the weighted average cost method.

    The cost of inventories includes expenditure incurred in acquiring the inventories and other costs incurred in making them available for use or sale. In case of finished products and work in progress, cost includes an appropriate share of production overheads determined based on normal operating capacity.

    Net realizable value is the current market price in the ordinary course of business, less the estimated costs of completion and selling expenses. In case of set-top boxes, mobile phones, modems and tablets, which under the business model applied by the Group are sold below cost, the loss on the sale is recorded when transferred to the customer.

    The Group creates an allowance for slow-moving or obsolete inventories.

    Inventories also include real estate built for sale (work in progress) and ready-to-sell properties (finished products) as part of development activities. Capitalized expenditures include, but are not limited to, construction planning and design costs, costs of land acquisition or perpetual usufruct of land for construction, remuneration payable to contractors and construction financing costs.

    In companies engaged in development activities, the way investment properties are classified depends on the advancement of the investment process. The companies assume that all investments in which a significant portion will be residential units, and whose investment process is likely to begin within the next three years, will be presented in the Balance Sheet under the item "inventories".

    Certificate of origin

    Included in the inventory are certificates of origin purchased for redemption, resale, as well as self-generated. These rights are tradable and are a subject to exchange trading.

    Certificates of energy origin received free of charge for production from renewable sources are recognized on initial recognition at fair value at the time it becomes probable that they will be received, i.e. at the end of the month in which they were produced. The fair value is a reflection of the market situation, i.e. quotations on the commodity energy exchange (POLPX). Unpaid acquisition of certificates is recognized in correspondence with other income. The Group sells surplus certificates, which are presented in inventory.

    Acquired energy certificates of origin are recognized as inventory at the purchase price. The outflow of energy certificates of origin is valued according to the method of detailed identification.

    The Group is required to obtain energy certificates of origin and submit them for redemption by June 30 of the year following the accounting year. If, as of the reporting date, there are not enough certificates required to fulfill the obligations imposed by the Energy Law and the Energy Efficiency Law, the Group creates reserves for the redemption of energy origin and energy efficiency certificates or the payment of replacement fees.

14. Impairment of assets

    Financial assets measured at amortized cost

    The Group measures the loss allowance at an amount equal to lifetime expected credit losses for trade receivables (including loans granted) and contract assets. The trade receivables are assessed for impairment collectively in groups that share similar credit risk characteristics. The expected credit losses are estimated based on historical pattern for repayment and collection efficiency adjusted with currently available forward-looking information. The credit risk characteristics of contract assets correspond to the credit risk characteristics of trade receivables for a particular type of contract.

    The Group considers financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full.

    The Group considers a financial asset to be credit impaired when events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred, including significant financial difficulty of the debtor or a breach of contract, such as a default or past due event.

    A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.

    Non-financial assets

    The carrying amounts of non-financial assets, other than inventories and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated by the Group. The recoverable amount of intangible assets which are not yet available for use as well as of goodwill and brands with indefinite useful life is estimated at each reporting date.

    An impairment loss is recognized when the carrying amount of an asset or its related cash-generating unit exceeds its estimated recoverable amount. A cash-generating unit represents the smallest identifiable group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of thereof. Impairment losses are recognized in profit or loss. Impairment losses recognized in respect of a cash-generating unit are allocated first to reduce the carrying amount of any goodwill allocated to

    the cash-generating unit (group of units), and then to reduce the carrying amounts of the other assets in the cash-generating unit on a pro rata basis.

    The recoverable amount of an asset or a cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to 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 asset. In case of assets that do not generate independent cash inflows, the value in use is estimated for the smallest identifiable cash-generating unit to which the asset belongs.

    An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recorded in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

15. Employee benefits

    Defined contribution plan

    All Group entities that act as employers have an obligation, under applicable legislation, to collect and remit contributions to the state pension fund. According to IAS 19 Employee Benefits such benefits represent state plans that are classified as defined contribution plans. Therefore, the Group's obligations for a given period are estimated as the amount of contributions to be remitted for that period.

    Defined benefit plan - retirement benefits

    The Group entities have an obligation, under applicable legislation, to pay retirement benefits calculated in accordance with the relevant provisions of the Polish labor code. The minimum retirement benefit is as per the labor code provisions at the moment of payment.

    The calculation is carried out using the Projected Unit Credit Method. Employee turnover is estimated based on historical experience and expected future employment levels.

    Changes in the amount of the retirement benefits liability are recognized in the income statement. Actuarial gains and losses are recognized in the equity, in other comprehensive income in full in the period they originated.

    Short-term employee benefits

    Short-term employee benefit obligations are measured on an undiscounted basis and are recognized as an expense as the related service is provided.

    A liability is recognized for the amount expected to be paid under short-term bonus, if the Group has a present legal or constructive obligation to make such payments as a result of past services provided by the employees and the obligation can be estimated reliably.

16. Provisions

A provision is recognized if, as a result of past event, the Group has a present obligation, and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation. When the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Certain disclosures may not be included in these consolidated financial statements as they relate to sensitive information.