Grupo Clarín S.A. Annual Report 2011

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FY2011 Annual Report · Grupo Clarín S.A.

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annual
report 2011

Disclaimer

Some of the information in this annual report (the “annual report”) may contain projections or other

forward-looking statements regarding future events or the future financial performance of Grupo

Clarín. You can identify forward-looking statements by terms such as ”expect”, ”believe”, “anticipate”,

“estimate”, “intend”, ”will”, “could”, “may” or ”might” the negative of such terms or other similar

expressions. these statements are only predictions and actual events or results may differ materially.

Grupo Clarín does not intend to or undertake any obligation to update these statements to reflect events
and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.

Many factors could cause the actual results to differ materially from those contained in Grupo Clarín’s

projections or forward-looking statements, including, among others, general economic conditions, Grupo

Clarín’s competitive environment, risks associated with operating in argentina, a rapid technological and

market change, and other factors specifically related to Grupo Clarín and its operations.

the annual report and certain boxes and charts that include highlighted information for illustrative

purposes throughout this publication, include financial information as of and for the fiscal years ended

December 31, 2011 and 2010, which was extracted from the Consolidated and the parent only Financial

Statements as of December 31, 2011, presented on a comparative basis, and their related notes. the

annual report and the Highlights should be read in conjunction with such financial statements and

related notes, the report of Grupo Clarín’s independent accountants, price Waterhouse & Co. S.r.l.,

Buenos aires, argentina (a member firm of priceWaterhouseCoopers) relating to such financial

statements, and the report of Grupo Clarín’s Supervisory Committee.

03 Financial and Operational Highlights
04 Macroeconomic Environment
05 Perspectives for the Upcoming Year
06 The Year 2011 and the Media Sector in Argentina
08 The Company. Origin, evolution and profile
10 Grupo Clarín and its Business Segments in 2011

12 CaBle teleVISIon & Internet aCCeSS
15 Programming, Cable Television and Internet Services
17 Commercialization and Customer Service
17 Strategy

18 prIntInG & puBlISHInG
19 Arte Gráfico Editorial Argentino
20 Diario Clarín
23 Other Newspapers
25 Ferias y Exposiciones Argentinas

26 BroaDCaStInG & proGraMMInG
29 Artear
31 Radio Mitre

32 DIGItal Content & otHerS
35 Digital Content
37 Other Services

38 Corporate GoVernanCe, orGanIzatIon

anD Internal Control SYSteM
41 Stock Information and Shareholder Structure

42 Corporate SoCIal reSponSIBIlItY
43 Our Commitment
45 People’s Voices
46 Social and Sustainability Coverage
47 Promoting Involvement
48 Community Engagement and Social Advertising
49 Fostering Education and Culture
50 Media Literacy and Young People
50 Excellence in Journalism
51 Our People
54 Environment

58 Risk Factors

59 Business Projections and Planning

60 FInanCIal StateMentS aS oF

DeCeMBer 31, 2011

annual
report 2011

FINANCIAL HIGHLIGHTS

(In millions of Ps.)

Net Sales

Adjusted EBITDA (1)

Adjusted EBITDA Margin (2)

Net Income

2011
9,752.5
2,598.7
26.6%
522.3

2010

7,632.0

2,351.8

30.8%

538.1

YoY

27.8%

10.5%

(13.5%)

(2.9%)

(1) We define Adjusted EBITDA as net sales minus cost of sales (excluding depreciation and amortization) and selling and administrative

expenses (excluding depreciation and amortization). We believe that Adjusted EBITDA is a meaningful measure of our performance. It is

commonly used to analyze and compare media companies on the basis of operating performance, leverage and liquidity. Nonetheless,

Adjusted EBITDA is not a measure of net income or cash flow from operations and should not be considered as an alternative to net income,

an indication of our financial performance, an alternative to cash flow from operating activities or a measure of liquidity. Because Adjusted

EBITDA is not an Argentine GAAP measure, other companies may compute Adjusted EBITDA in a different manner. Therefore, Adjusted

EBITDA as reported by other companies may not be comparable to Adjusted EBITDA as we report it.

(2) We define Adjusted EBITDA Margin as Adjusted EBITDA over Net Sales.

oPerATING reSuLTS

(In millions of Ps.)

Total Consolidated Subscribers (1) (2)

Total Internet Subscribers (2)

Circulation (3)

Audience Share % (4)

Prime Time

Total Time

(1) Figures in thousands.

2011
3,490.3
1,351.1
331.2

42.2%
33.0%

2010

3,357.9

1,128.2

360.8

42.2%

31.0%

YoY

3.9%

19.8%

(8.2%)

0.2%

6.4%

(2) Total subscribers consolidated following the same consolidation methods used in the financial statements as of each year end.

(3) Average number of copies according to IVC (including Diario Clarín and Olé).

(4) Share of broadcast TV audience according to IBOPE for AMBA. Prime Time is defined as Monday through Friday from 8 pm to 12 am.

Total Time is defined as Monday through Sunday from 12 pm to 12 am.

ADJuSTeD eBITDA

(In millions of Ps.)

Cable TV and Internet Access

Printing and Publishing

Broadcasting and Programming

Digital Content and Others

Subtotal

eliminations

Total

2011
2,056.6
257.1
285.5
(0.6)
2,598.7
-

2,598.7

2010

1,829.5

303.4

211.5

7.5

2,351.8

YoY

12.4%

(15.3%)

35.0%

(107.6%)

10.5%

2,351.8

10.5%

02 03

2011 MACroeCoNoMIC
eNVIroNMeNT

In a year marked by global uncertainty, the world
was undoubtedly distinguished by the dynamics
emerging economies managed to sustain under
a complex environment of ongoing crises of
different kind that hit the developed countries
(with peripheral europe at the epicenter).

In fact, while during the year under analysis half of
the world represented by the developed countries
experienced, at best, anemic GDP growth in spite
of the several incentives granted to them; the
other half -the block of emerging countries led
by China- preserved their dynamics which, on
average, tripled that of the former. The world has
continued to see growth at two different paces
of structural trend, reflecting the operation of the
new global accumulation mechanism focused on
emerging economies.

In this context, the Argentine economy managed
to sustain growth in its productive activity in 2011,
in line with virtually all emerging countries. Such
performance was driven by the vigorous terms
of trade in the external arena, along with the
typical expansionist bias of the economic policy
in an electoral year and the favorable weather
conditions for the agricultural sector on the
domestic front.

However, unlike other emerging countries, this
increase in productive activity was again paired
with high inflation rates that prevented the country
from fully capitalizing on the proceeds from such
growth and from improving their distribution. In
2011, the Argentine economy experienced growth
with inflation again. This fact, coupled with the
currency board strategy implemented in order to
moderate the inflationary impact of the strong
drive generated by public policies, resulted in a
new deterioration of the pillars that supported the
recovery process after the 2001-2002 crisis.

In addition to this, the Argentine economy is
operating under certain disturbing conditions,
such as, increased primarization, a shortage of
reproductive investments (noticeable mainly in the
capital depletion of key strategic sectors) and the
low level of foreign direct investment in relation to
other countries in the region.

Therefore, in spite of its remarkable growth cycle,
Argentina has yet to show any clear progress in its
development. Poverty, which has remained almost
unchanged since early 2007 and which, according

to private estimates, still affects 9 million
Argentine people, clearly reflects the latter.

According to private sources, Argentina’s real GDP
is estimated to have increased by approximately
7%, slightly below the 2010’s figure; whereas
inflation remained at virtually the same level as
the previous year (around 23%). The Argentine
economy continues to register an inflation rate
three percentage points higher than the growth
rate, a unique phenomenon in the region, except
for Venezuela.

The three pillars that supported the economic
recovery after the 2001-2002 crisis deteriorated
in the year under analysis. The nominal exchange
rate, which operates as an
inflation buffer
together with the virtually frozen utility tariff
rates, did depreciate with respect to the uS
dollar throughout the year, but at a substantially
lower rate than the price increases (slightly over
8% vs. 23% mentioned above). The significant
adjustment of the real exchange rate that led
to this gap continued to accelerate the loss of
competitiveness.

The currency depreciation, coupled with the strong
dynamics of the economic activity, exacerbated
the growth of imports which, at the end of 2011,
were higher than exports, thus deteriorating the
balance of trade surplus (which showed an 11%
decrease, from usd11.6 billion to usd10.3 million in
absolute values).

For the first time in more than two decades, at
the end of the year, Argentina’s energy industry
will have showed a negative trade balance
(estimated in over usd2.5 billion). For the purposes
of assessing the energy self-sufficiency loss,
only four years ago, this sector’s balance of trade
showed surplus (approximately usd2.5 billion) and
accounted for more than one quarter of the total
external surplus.

The lower generation of foreign currency was
worsened by a capital flight from the private
sector which, in the year under analysis, almost
doubled the previous year’s figure and stood
somewhere in the neighborhood of 2008’s record
high (usd23.8 billion). This resulted in a decrease
in the Central Bank’s international reserves which,
by the end of the year, stood at almost usd6 billion
below the usd52.1 billion recorded in December,
2010, in spite of stronger exchange controls.

Thus, deterioration on the fiscal front was more
significant than on the external front. The national
public sector showed a financial deficit in the year
under analysis (as a result of the debt service)
which jumped to almost two and a half point of GDP.
In absolute values, this deficit (estimated in over
Ps.50 billion, without counting revenue distributions
received from the BCrA and revenues of the
ANSeS derived from the ownership of government-
issued securities) almost doubled that of 2010
and has become the most significant one since
2003 onwards. This deterioration, mostly funded
by the issue of currency and intra-governmental
indebtedness, took place in spite of record-high tax
pressure (approximately 35% of GDP).

Perspectives for the upcoming Year

During the last weeks, the growing uncertainty
over the recovery pace of the developed countries’
economic activity and employment resulted in
overall downward growth perspectives for 2012.

The virtual stagnation or expansion below
potential experienced by these countries,
in
general, and peripheral europe, in particular,
became an actual threat to the world’s economy,
where one of the key concerns is the extent of
the impact of this external shock on the current
emerging catalysts.

In the light of this new international crisis, the
Argentine economy has less scope for action. In
fact and unlike 2008, the Argentine economy no
longer has fiscal, exchange or energy buffers.
Actually, unlike the last years, the local economy
lacks strong dollar reserves.

In perspective, the energetic situation is seen as
the main responsible for the deterioration of the
external and fiscal accounts. Accordingly, the
growing public expenditure to sustain tariff rates
and import energy compromised public accounts
so badly that it accounts for a significant portion of
the last years’ fiscal deterioration. The scheduled
elimination of subsidies seeks to streamline a
structure that was unequal and that could no
longer be genuinely funded.

In addition, the macro and microeconomic
consequences of the recently implemented controls
on imports to preserve the trade surplus are difficult
to foresee as of the date of this annual report.

The truth is that insofar as the government
continues to pretend to use the exchange rate
to anchor inflation by minimizing the Argentine
currency nominal devaluation rate, the expansive
economic policies - so far focused on boosting
GDP growth and import growth indirectly - will be
clearly limited in their scope.

The implementation of measures to moderate
the growth pace of variables, such as, public
spending, salaries and monetary aggregates,
shall be understood within the framework of this
growth moderating strategy adopted in the face of
a certainly less favorable environment.

To make matters worse in this already complex
environment, the drought caused by “La Niña”
compelled to dramatically reduce agricultural
in the
projections
neighborhood of 110 million tons and have been
now cut to approximately 100 million tons) and,
therefore, the sector’s exports (by approximately
10% compared to 2011).

(which stood somewhere

As a result of all the above mentioned, the
Argentine economy’s growth rate would slow
down significantly in 2012. However, inflation
would remain at current levels, since the
increases in the utility tariff rates resulting from
the overall elimination of subsidies are expected
to considerably offset the lower dynamics of
aggregate demand. Thus, high inflation would
continue to hinder significant improvements in
social indicators and in the distribution of income
among the Argentine people.

The conditions described above clearly show
that Argentina has less macroeconomic tools to
face this new international crisis. In spite of its
dynamics and low indebtedness level, the current
economy systematically expels local capital and
repels foreign capital. In other words, the current
modus operandi of the local economy does not
provide a reasonable level of confidence to the
Argentine people (who prefer to invest their
savings abroad, rather than domestically) as well
as to foreigners (who channel a low level of their
regional productive investments in our country).

04 05

THe YeAr 2011 AND THe MeDIA
SeCTor IN ArGeNTINA

In 2011, the global media industry - undoubtedly,
one of the most seriously hit by the 2009’s
financial crisis, experienced certain weakening
in its business volume, as a result of the sudden
slowdown of the global economic activity
and, particularly, of the developed countries.
As a matter of fact and due to their inherent
differences, the slowdown was not homogenous
at all among countries, segments and companies.

the developed countries

The uncertainty over the pace of recovery of
consumption, productive activity and employment
in
represented an
additional risk focus for this industry, which was
already facing several challenges arising from
the ongoing emergence of new technologies
and the changes in the new generations’ media
consumption patterns.

However, such uncertainty did not affect at all the
migration of audiences, content and advertisers
towards the digital ecosystem. This main trend
the industry has been developing over the last
years managed to preserve its carryover effect,
primarily supported by the broadband revolution.

2011 was a year of genuine growth for the
economy and the local media industry. In fact,
according to estimates, GDP and consumption
would have increased by around 7% by the end
of the year, driven by the expansionist bias of
the economic policy and the prevailing favorable
terms of trade. However, this strong expansion of
local productive activity was again accompanied
by an inflationary upsurge that prevented the
country from fully capitalizing on the fruits of
growth and improving their distribution.

even so, the re-emergence of aggregate demand
along with certain specific events, such as
the presidential elections, paved the way for
a macroeconomic environment favorable to the
industry. A good example of this is the good
performance of the industry’s main sources of
financing.

In fact, advertising investment increased again
this year by slightly more than 20%, mostly driven
by government’s advertising spending in an
electoral year, oriented to finance a matrix with a
greater share of publicly-owned media. Concerning
consumer prices, the increase in the consolidated
advertising pie of the several industry segments
was virtually similar to the annual 22-23%
inflation rate estimated by the public sector. This
shows that even though advertising is growing,

the complementariness that this technology
provides to the market.

In this regard, an emerging and curious
phenomenon is the users’ ongoing demand
for higher speed, mostly as a result of the
predominance of video traffic over other traffic
and, to a lesser extent, as a result of the increasing
number of devices connected to the Internet
at home. Naturally, this increased demand for
bandwidth per client compels providers to add
new capabilities to their networks on an ongoing
basis, thus putting the current business models
under pressure.

The new media consumption patterns continue
to gain ground as new technologies are adopted
much faster than projected. In fact, the number
of visits to websites with content development
continued to increase, particularly news sites,
with the newspapers in the top ranks. As a logical
consequence, the increased number of readers of
digital newspapers, together with the increased
offering of news signals on television, helped to
reinforce the downward structural trend in the
volume of newspaper copies in paper format, also
showing that demand for content remains strong,
unlike preference for paper format newspapers.

Notwithstanding the above, it is worth noting
the current exponential growth of and massive
access to social networks, not only as sources of
entertainment, but also as sources of multimedia
content and recommended information.

it does so at lower pace than the economy as a
whole (measured in GDP terms), which in 2001
increased by more than 30% in nominal values.
Therefore, the traditional multiplier effect it used
to have some years ago seems to have vanished.

unlike most countries in the region, newspapers
continued to attract the largest share of advertising
in the local market, followed by broadcast TV. The
paid television and Internet segments, which in
2010 recovered from the stagnated levels in 2009,
expanded again in 2011 in accordance with their
potential, even though Argentina’s penetration
rates are among the highest in the region.

Thus, during 2011 the paid television subscriber
base grew at a rate of almost 5%, slightly less
than the previous year, reaching approximately 7.6
million users at year-end. Leverage in the growing
penetration of additional services (incorporation
of high-definition signals to the grid and VoD,
among others), which permitted a high level of
investment in the expansion of network capacity,
had a key role in such performance. It is worth
noting that the government’s launch of Digital
Terrestrial Television did not have a significant
impact on the annual net capture of this industry.

Broadband demand grew for the second
consecutive year at rates of approximately 20%,
becoming increasingly ubiquitous. In fact, by year-
end, residential fixed broadband Internet access
reached a new record high of over 5 million
subscribers in a fiercely competitive environment
noted for the promotional offers of its main market
players. At the same time, the existence of more
than 1.3 million mobile broadband subscribers and
the implementation of combined voice and data
subscriptions by cell phone companies evidence

regulatory framework and conditions for
the journalistic and media activity during 2011

In addition to the aforementioned and to the
comments under Note 15 to the Parent Company
only Financial Statements, during 2011 private
media in general and Grupo Clarín in particular
continued to face an escalating level of
harassment. Such harassment was executed
through the official and para-official apparatus,
with the clear intention of damaging the media’s
reputation and directly and indirectly limiting its
journalistic activities.

In the framework of this escalation, the government
reinforced certain actions that threaten and distort
the full effectiveness of freedom of speech and
information, such as the exponential increase and
discriminatory distribution of official advertising
used to create and sustain like-minded media;
the discretionary use of public funds and media
to generate content and programs related to
political propaganda; and the several obstacles
and discriminatory conduct in the access to public
information.

This discrediting and defamatory strategy was
painfully reflected in street banner and graffiti
campaigns, banners, balloons, packaging and
clothing, in persecution, espionage and phone-
tapping actions against media, editors and
journalists, and went so far as to include the
financing of soccer hooligans arranging banners
against the media and members of the judicial
branch to be displayed in soccer stadiums and the
advertising to be broadcast during the games.

other tools to exert editorial pressure consisted
of abuse of bureaucratic controls or controls
by public agencies which took the form of
administrative persecutions, groundless arbitrary
resolutions, disproportionate tax controls and
recurring audits. In this scenario, the government
did not hesitate to exert pressure on entities such
as the National Antitrust Commission, AFSCA,
the Argentine Securities Commission and the
Financial Information unit.

In the audiovisual sector, this offensive against
the media (against both, its editorial freedom and
its economic sustainability, which guarantees
its independence) had as its utmost expression
the enactment of the controversial Audiovisual
Communication Services Law and its increasingly
challenged implementing regulations which
clearly exceed the regulatory framework, since
they grant powers to the regulatory agency which
are not provided for by the law. Some examples
of this are: i) the power to intervene in the affairs
of the audiovisual broadcasting services on a

discretionary basis: whether by revoking licenses
or through simple summary proceedings, and ii)
by ruling the organization and mandatory content
of the programming grid of subscription cable TV
services, whereby Cablevisión was imposed over
500 penalties throughout 2011 which are now
suspended by a court decision.

The law that gave rise to this unconstitutional
implementing regulation continues to be
challenged by the judiciary, condemned for
infringing constitutional rights, granting broad
and discretionary powers over media and content
to the executive Branch, favoring official voices
and affecting the sustainability of private media,
promoting the elimination of independent signals
and establishing dangerous indirect censorship
criteria through the arbitrary granting of licenses
and the application of penalties, among other
controversial aspects.

Since its enactment in october 2009, several
court decisions upheld preliminary injunctions
which are currently effective, providing for
the suspension of the main sections of the
broadcasting law; including, but not limited to,
section 161 which refers to the conforming regime
that sets forth the mandatory divestiture in the
term of one year. In spite of the existence and full
effectiveness of said court decisions against the
law, the government sought to move forward with
the implementation thereof in an authoritarian
and overwhelming manner. This ratifies all the
warnings about the potential danger of editorial
control by an enforcement authority that is not
independent.

on the other hand, and concerning SeCoM’s
administrative resolution issued in 2010 whereby
Fibertel’s license was revoked, there are two
effective preliminary injunctions that suspend
the application of the resolution and challenge its
legality.

At the same time, in 2011, the offensive against
independent media and free journalism continued
to take very diverse forms, including the measures
adopted by trade unions related to the government,
which repeatedly tried to prevent newspaper
and magazine distribution by blockading printing
facilities. Several official agencies also sought
to control paper, the basic input for newspaper
production.

The government’s attempt to gain control of the
paper industry has intensified, through several
administrative and legislative measures that

systematically sought to hinder the management
of Papel Prensa
(Papel Prensa supplies
approximately 95% of the Argentine newspapers
and the Company indirectly holds a 49% equity
interest in that company). The government has
tried to interfere with Papel Prensa’s business
practices and bring legal and administrative
actions against it in a threatening and violent
environment.

For example, the government filed several motions
with the CNV to have Papel Prensa’s resolutions
declared void for administrative purposes. The
CNV also brought several summary proceedings
against the Company, its directors and members
of the supervisory committee.

on the legislative front, the Congress enacted Law
26,736 which declared a matter of public interest
the production and sale of newsprint, violating
several constitutional rights and guarantees.
The bill was drafted by the National Government
with the clear intent of controlling the production
and import of this key input for the press, as
pointed out and stated by national and regional
journalistic associations, opposition leaders and
several business sectors. Among other things,
the Law created a registry where all newsprint
producers, sellers and buyers shall be registered
and set
limits and established conditions
applicable to Papel Prensa for the production and
sale of newsprint. This law also contains a series
of temporary clauses, specifically and exclusively
addressed to Papel Prensa, whereby Papel Prensa
is forced to make investments to meet the total
national newsprint demand -excluding from this
requirement the other existing company that
operates in the country with installed capacity to
produce this input. The Law also provides for the
capitalization of the funds eventually contributed
by the Government to finance these investments,
contravening public order regulations contained
in the Argentine Business Associations Law (Law
19,550), in order to dilute the equity interest of
Papel Prensa’s private shareholders.

These and other deplorable actions that are not
in line with the expected attitude of a democratic
government towards the press were part of
the challenging scenario in which private and
independent media operated in 2011.

06 07

THe CoMPANY. orIGIN,
eVoLuTIoN AND ProFILe

Grupo Clarín is the most prominent and diversified
media group in Argentina and one of the most
important in the Spanish-speaking world. The
Company is organized and operates in Argentina
and its controlling shareholders and management
are Argentine. Grupo Clarín is present in the
Argentine printed media, radio, broadcast
and cable television, audiovisual production,
the printing industry and Internet access. Its
leadership in the different media is a competitive
advantage that enables Grupo Clarín to generate
significant synergies and expand into new

markets. Substantially all of Grupo Clarín’s assets,
operations and clients are located in Argentina,
where it generates most of its revenues. The
Company also carries out operations at a regional
level.

Grupo Clarín and its subsidiaries have 17,200
employees and, by the end of 2011, reached
annual consolidated revenues of Ps.9,753 million.

Grupo Clarín’s history dates back to 1945, the year
in which roberto Noble founded the newspaper

Clarín of Buenos Aires (“Diario Clarín”), with
the goal of becoming a mass-distribution and
quality newspaper, privileging information and
committing to the comprehensive development
of the country. Since 1969, Diario Clarín has been
led by his wife, ernestina Herrera de Noble. It
became the flagship national newspaper and has
consolidated its position throughout the years
thanks to the work of its journalists and the loyalty
of its readers. Diario Clarín is now one of the
Spanish-language newspapers with the highest
circulation in the world.

THe CHArT BeLow ILLuSTrATeS CoMPANIeS IN wHICH GruPo CLAríN PArTICIPATeS,
DIreCTLY or INDIreCTLY, orGANIzeD BY BuSINeSS SeGMeNT

INTEr

BlE TV &
NET ACCESS

PrINTIN
BlIShIN

G &

BrO
PrO

DCASTIN
GrA

G &

MIN

60%

CABlEVISIóN

100%

AGEA

99.2%

ARTEAR

DIGITAl CO

NTENT
& OThErS
100%

GESTIóN
COMPARTIDA

100%

Compañía de
Medios Digitales

100%

Ferias y
exposiciones

85.2%

100%

oportunidades

100%

Telecolor
Canal 12

Telba
Canal 7

100%

Tinta
Fresca

100%

AGr

100%

Bariloche TV

55%

Pol-Ka
Producciones

100%

unir

30%

Ideas del Sur

50%

Impripost

100%

CIMeCo

80%

81%

49%

Diario
Los Andes

La Voz
del Interior

Papel
Prensa

12%
37%

33%

25%

Patagonik
Film Group

Canal rural
Satelital

100%

IeSA

51%

Auto Sports

50%

TSC

50%

TrISA

100%

radio
Mitre

Because Argentine Corporate Law No. 19550

(as amended, the “Argentine Corporate Law”) requires

that companies have at least two shareholders,

a small percentage of the capital stock of certain of our

subsidiaries is held by GC Minor S.A., a company owned

by Grupo Clarín (95.3%) and GC Dominio S.A. (4.7%).

This chart does not include certain intermediate

holding vehicles and certain subsidiaries that do not

have significant assets or business.

Grupo Clarín has been one of the main actors in
the changes undergone by the media worldwide.
It has incorporated new and varied printing
activities and decided to embrace technological
developments, investing to reach its audiences
through new platforms and channels and through
new audiovisual and digital languages.

(DyN).

agency
In the audiovisual arena, the
Company also produces one of the 5 cable news
signals (Todo Noticias), and the cable television
networks Volver and Magazine, among others,
sports channels and events (TyC Sports), television
series and motion pictures (through Pol-ka, Ideas
del Sur and Patagonik).

In this way, Grupo Clarín entered the radio and
television sectors. Today, it is the owner of one of
the two leading broadcast television channels in
Argentina (ArTeAr/Canal Trece) and of AM/FM
broadcast radio stations. Along with the newspaper,
these media are recognized as the most credible
and considered leaders of Argentine journalism
in one of the most diverse media markets in the
world. For example, in Buenos Aires alone, the
Company’s media compete in a market that has 5
broadcast television stations, 550 radios, and 12
national newspapers.

Grupo Clarín also publishes olé, the first and only
sports daily in Argentina; the free newspaper La
razón and the magazines Ñ, Genios, Jardín de
Genios, Pymes and elle, among other publications.
Through CIMeCo, the Company holds equity
interests in the newspapers La Voz del Interior, Día
a Día and Los Andes, in a market of approximately
200 regional and local newspapers. The Company
also holds an equity interest in a national news

Another strength lies in its strategic stake in
the content distribution sector, through cable
television and Internet access. Since the beginning
of Multicanal’s operations in 1992 and after
the recent acquisition of a majority interest in
Cablevisión, Grupo Clarín has created one of the
largest cable television systems in Latin America
in terms of subscribers. In Argentina, Cablevisión is
the first among 700 operators and always competes
with other cable or satellite options. Also, through
Fibertel, it provides high-speed Internet services
and has one of the largest subscriber bases in
a highly competitive market. In line with the
global trend, Grupo Clarín has committed itself
to expanding digital content production. Grupo
Clarín’s Internet portals and sites receive more
than half of the visits to Argentine websites.

In 1999 Grupo Clarín was incorporated as an
Argentine sociedad anónima, a corporation with
limited liability. It gradually opened its capital to
other participants and, since october 2007, it is

listed on the Buenos Aires Stock exchange and on
the London Stock exchange. It takes pride in having
grown in Argentina, in being a source of influence on
a local level in an increasingly transnational market
with a size that enables it to compete without losing
strength among large international players.

Grupo Clarín’s investments in Argentina in the last
20 years have been very significant, always focused
on: journalism and the mass media. Its activities
have contributed to the creation of an important
Argentine cultural industry and generate qualified
and genuine employment. Its vision and business
model focus on investing, producing, informing
and entertaining, preserving Argentine values and
identity, and preserving business independence in
order to ensure journalistic independence.

In relation to its mission and values, since its
foundation, Grupo Clarín has undertaken intense
community activities. Grupo Clarín, together with
the Noble Foundation, which was established in
1966, organizes and sponsors several programs
and activities, particularly focused on education,
culture and citizen participation. Furthermore, as
an indication of its social responsibility throughout
its history, Grupo Clarín focuses on the ongoing
its processes and develops
improvement of
initiatives that arise from discussions with different
stakeholders.

we ANTICIPATeD MArKeT TreNDS AND ADAPTeD our BuSINeSS MoDeL,
To BeCoMe THe LArGeST MeDIA GrouP IN ArGeNTINA

1945

1970

1990

2000

2011

Foundation

Vertical
Integration

Horizontal
Integration

Technology Convergence
& Regional Expansion

Relevant Dates

July 16, 1999: Grupo Clarín S.A. is created to

reorganize and consolidate the direct and indirect

holdings of the Clarín Shareholders.

october 19, 2007: Grupo Clarín launches its Initial

Public offering (IPo).

08 09

GruPo CLAríN AND ITS BuSINeSS
SeGMeNTS IN 2011

In terms of results, Grupo Clarín and its business
segments grew again in 2011 in a highly challenging
context. During this year the Company consolidated
the positive economic and financial performance
trends of the previous years.

Net consolidated sales increased by 27.8% to
Ps.9,753 million. The growth in cable modem
Internet access subscribers played a key role in the

performance of subscription revenues. Sales of the
remainder of the Company’s products and services
also increased.

SALeS BreAKDowN BY SourCe oF reVeNue - DeCeMBer 2011 vs. DeCeMBer 2010

(In millions of Ps.)

CABlE TV &

PrINTING &

BrOADCASTING &

DIGITAl CONTENT &

ElIMINATIONS

TOTAl

INTErNET ACCESS

PuBlIShING

PrOGrAMMING

OThErS

2011

77.6

2010

54.7

4,478.9

3,618.6

Advertising

Circulation

Printing

Video

Subscriptions

Internet

1,364.4

1,039.7

Subscriptions

Programming

650.5

540.5

249.7

183.2

355.0

129.9

331.9

90.6

2011

2010

1,184.3

1,006.7

2011

978.8

2010

702.2

2011

21.6

2010

43.6

2011

2010

2011

2010

(129.5)

(110.7)

2,132.8

1,696.5

2011

21.9%

6.7%

2.2%

2010

22.2%

7.1%

2.0%

(35.9)

(32.6)

650.5

213.8

540.5

150.6

4,478.9

3,618.6

45.9%

47.4%

(3.2)

(0.6)

1,361.2

1,039.1

14.0%

13.6%

other Sales

416.0

172.1

74.2

73.7

261.4

197.3

(193.1)

(166.1)

(128.0)

(112.7)

227.0

688.5

219.2

367.6

2.3%

7.1%

2.9%

4.8%

Total Sales

6,336.9 4,885.1

2,158.7 1,804.0 1,463.7 1,124.7

283.0

240.9

(489.8)

(422.7)

9,752.5 7,632.0

100.0% 100.0%

Cost of sales (Excluding Depreciation and
Amortization) reached Ps.4,872.5 million, an
increase of 35.5% from the figure reported
for 2010 due to higher costs in our business
segments, mainly in Cable TV and Internet
Access and in Printing and Publishing, and also
in the Broadcasting and Programming segment.

Selling and Administrative Expenses (Excluding
Depreciation and Amortization) reached Ps.2,281.4
million, an increase of 35.5% from Ps.1,683.1
million in 2010. This increase was mainly due to
higher costs in the Cable TV and Internet Access,
Printing and Publishing and Broadcasting and
Programming segments.

Adjusted EBITDA reached Ps.2,598.7 million, an
increase of 10.5% from 2010, driven by higher
sales in the Cable TV and Internet Access and
Broadcasting and Programming segments,
and mainly due to margin expansion in the
Broadcasting and Programming segment; although
it was partially offset by a lower eBITDA in the
Printing and Publishing and Digital Content and
others segments.

Financial results net totaled Ps.(592.8) million
compared to Ps.(420.3) million for 2010. The
increase was mainly due to higher interest
expenses and peso depreciation during 2011,
which went from Ps 3.98 per dollar at the end of
2010, to Ps 4.30 per dollar as of December 31,
2011; and was partially offset by an accounting
gain accrued as a result of Cablevision refinancing
debt.

Equity in earnings from unconsolidated affiliates
in 2011 totaled Ps.16.7 million, compared to Ps.4.1
million for 2010.

Other income (expense), net reached Ps.7.7 million,
compared to Ps.(7.5) million in 2010.

Income tax as of December 2011 reached Ps.(454.2)
million, from Ps.(493.4) million in December 2010.

Net income totaled Ps.522.3 million, a decrease
of 2.9% from Ps.538.1 million reported for 2010.
This was mainly a consequence of a higher peso
depreciation and lower eBITDA in the Printing and
Publishing segment.

Cash used in acquisitions of property, plant and
equipment (CAPEX) totaled Ps.1,511.2 million in
2011, an increase of 56.1% from Ps.967.9 million
reported for 2010. out of the total CAPeX in 2011,
92.02% was allocated to the Cable TV and Internet
Access segment, 5.25% to the Broadcasting and
Programming segment and the remaining 2.73%
to other activities. CAPeX in the Cable TV and
Internet Access segment pertains to subscriber
growth, network upgrades, digitalization and
further development of the triple play strategy.

By the end of 2011, Grupo Clarín’s gross
(including sellers
consolidated financial debt
financing, accrued
interest and fair value
adjustments) was approximately Ps.3,217.8 million,
while net consolidated debt was approximately
Ps.2,306.4 million, representing an increase of
34.1% and 31.2%, respectively. Debt coverage
ratio for the period ended December 31, 2011 was
1.26x and the Net Debt at the end of this period
totaled Ps.2,361.1 million.

(1) Debt Coverage ratio is defined as Total Financial Debt minus Cash and

Equivalents divided by Adjusted EBITDA (last 12 months). Total Financial

debt is defined as financial loans and debt for acquisitions, including

accrued interest. The figure does not include cash in reserve accounts

in Cablevisión S.A.

ADJuSTeD eBITDA

(In millions of Ps.)

Cable TV and Internet Access

Printing and Publishing

Broadcasting and Programming

Digital Content and Others

Subtotal

eliminations

Total

DeBT AND LIQuIDITY

(In millions of Ps.)

Short Term and Long Term Debt

Current Financial Debt

Financial loans

Negotiable obligations

Accrued interest

Acquisition of equipment

Sellers Financing Capital

related Parties Capital

related Parties accrued interest

Bank overdraft

Non-Current Financial Debt

Financial loans

Negotiable obligations

Accrued interest

Acquisition of equipment

Sellers Financing Capital

related Parties Capital

related Parties accrued interest

Total Financial Debt (A)

Measurement at fair Value

Total Short Term and long Term Debt

Cash and Cash equivalents (B)*

Net Debt (A) – (B)

Net Debt/Adjusted eBITDA (Last 12 Months)

% uSD Debt

% Ar. Ps. Debt

* Does not include reserve Accounts.

2011

2,056.6

257.1

285.5

(0.6)

2,598.7

2010

1,829.5

303.4

211.5

7.5

2,351.8

YoY

12.4%

(15.3%)

35.0%

(107.6%)

10.5%

2,598.7

2,351.8

10.5%

FY11

FY10

% Change

451.0

118.2

129.0

86.9

42.6

9.0

13.2

0.1

52.1

2,821.4

136.9

2,584.0

1.9

95.0

0.8

2.1

0.7

3,272.5

(54.7)

3,217.8

911.4

2,361.1

0.91x

94.5%

5.5%

264.7

42.8

133.9

33.2

36.0

3.8

5.0

0.1

10.0

2,126.5

120.1

1,964.8

1.0

36.9

1.1

2.1

0.4

2,391.3

7.8

2,399.1

640.7

1,750.6

0.74x

94.9%

5.1%

70.4%

176.4%

(3.7%)

161.4%

18.4%

137.2%

163.0%

22.3%

422.0%

32.7%

14.0%

31.5%

85.0%

157.7%

(27.5%)

74.4%

36.9%

(798.6%)

34.1%

42.2%

34.9%

22.1%

(0.4%)

6.7%

10 11

CABLe TeLeVISIoN & INTerNeT ACCeSS

CABLe TV & INTerNeT ACCeSS

Grupo Clarín operates, through Cablevisión, one
of the main regional integrated cable television
and broadband systems. This segment’s revenues
mainly derive from monthly subscriptions to basic
cable television service and high-speed Internet
access. To a lesser extent, its revenues also derive
from connection and advertising charges, sales of
premium and pay-per-view programming, digital
package, DVr, and high definition signal package
(HD) and sales of the magazine “Miradas”.

out of Grupo Clarín’s total sales in 2011, the
Cable television and Internet access segment was
the Company’s main revenue driver, with sales
of Ps.6,336.9 million, taking into consideration
intersegment sales.

regarding the geographic availability of Grupo
Clarín’s services, by the end of 2011, its network
reached approximately 7.3 million Argentine
households. Grupo Clarín provides services in
the City of Buenos Aires and suburban areas, as
well as in the provinces of Buenos Aires, Santa
Fe, entre ríos, Córdoba, Corrientes, Formosa,
Misiones, Salta, Chaco, La Pampa, Neuquén and
río Negro. regionally, Grupo Clarín also operates
in uruguay and Paraguay.

NET SAlES

(In millions of Ps.)

6,500

6,000

5,500

5,000

4,500

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

YoY

2010

9
.
6
3
3
,
6

Internet access
Cable TV &

ADjuSTED EBITDA

(In millions of Ps.)

2,200

2,000

1,800

1,600

1,400

1,200

1,000

800

600

400

200

2010

6
.
6
5
0
,
2

Internet access
Cable TV &

29.7%

YoY

12.4%

12 13

operating Statistics - CABLe TV & INTerNeT ACCeSS

2011

7,586.5

63.2%

3,490.3

3,264.4

225.9

110.0

115.9

46.0%

3,566.6

15.1%

2,656.0

1,082.5

875.0

207.6

40.8%

1,351.1

1,331.3

12.1

7.6

28.2%

154.1

2010

7,488.9

59.9%

3,357.9

3,149.3

208.5

102.8

105.8

44.8%

3,433.6

14.3%

2,225.4

699.1

584.4

114.7

31.4%

1,128.2

1,102.4

16.5

9.3

25.2%

123.6

YoY

1.3%

5.6%

3.9%

3.7%

8.3%

7.0%

9.6%

2.6%

3.9%

5.6%

19.3%

54.9%

49.7%

81.0%

29.7%

19.8%

20.8%

(26.4%)

(17.8%)

12.0%

24.7%

Homes Passed (1)

Bidirectional Homes Passed
Cable TV
Total Consolidated Subscribers (1) (3)

Subscribers - Argentina

Subscribers - International

uruguay

Paraguay

% over Homes Passed

Total Equity Subscribers (4)

Churn rate %
Digital Video

Digital ready Pay TV Subs

Total Digital Decoders

Argentina

International

Penetration over Digital ready TV Subs
Internet Subscribers
Total Internet Subscribers (1)

Cablemodem (1)

ADSL (1)

Dial up (1)

% over Bidirectional Homes Passed

Total ARPu (2)

(1) Figures in thousands.

(2) Net Sales/ Average Pay TV Subscribers.

(3) Total subscribers consolidated following the same consolidation methods used in the financial statements as of each year end.

(4) Total subscribers considering the equity share in each subsidiary.

In terms of subscribers, by the end of the year,
the Company’s cable television systems had
approximately 3,490,300 subscribers in Argentina,
Paraguay and uruguay, and 1,351,107 Internet
service subscribers in Argentina and abroad.

Cablevisión’s network’s backbone consists entirely
of fiber optic cable. The bi-directional service
network’s architecture and the new networks rely
on a fiber to service area (“FSA”) design, which

combines cable network fiber trunks with coaxial
cable extensions and permits bi-directional
transmission.

By the end of 2011, most of the total homes in
Cablevisión’s network were passed by its 750 Mhz
bi-directional broadband. Cablevisión’s 750 MHz
networks enable it to offer services and products
that generate additional revenues, such as access
to Internet, digital services and premium channels.

Programming, Cable Television
and Internet Services

Cablevisión offers subscribers a basic service plan
which includes the main programming signals,
depending on the capacity of the local network.
It offers basic and premium programming from
more than 25 providers and broadcast television
stations of the City of Buenos Aires. Most of
the programming contracts include pricing terms
denominated in Argentine Pesos generally linked
to the number of subscribers.

By paying an additional fee and renting a digital
set-top box, Cablevisión subscribers receive
premium packages and pay-per-view programming
that include additional movie channels and adult
programming, among other products.

Cablevisión is also offering digital services to its
subscribers that include a basic digital package,
as well as Premium and High Definition (HD)
services. Such products are offered in the City
of Buenos Aires and its surrounding areas (the
“AMBA region”), in the province of Buenos Aires,
Córdoba, rosario, Mar del Plata, Santa Fe and
other cities in the provinces.

Cablevisión has recently launched a high definition
signal package (HD) as well as Cablevisión Max
HD, state-of-the-art digital set-top units with
digital video recorder (DVr). By the end of 2011,
Cablevisión had 24 HD signals comprising different
genres in order to enhance this product’s offering.
In order to increase its brand equity, move
forward with innovation and content production
to meet client’s demands and continue with the
development of the digital products launched
during 2007, Cablevisión is developing a VoD
(Video on Demand) product that allows subscribers
to access several content from their TV on demand
that features video functions (pause, fast-forward,
rewind).

As of December 31, 2011, there were approximately
1,982,400 digital set-top units for Premium service
in all of Cablevisión’s operational regions (including
uruguay and Paraguay), resulting in a penetration
rate of approximately 31% of all subscribers to
its basic cable service provided through its digital
network. Cablevisión also offers Cablevisión Flex,
an optional social service of digital paid television
with a reduced subscription, to approximately
500,000 inhabitants of low income neighborhoods.

14 15

CABLe TV & INTerNeT ACCeSS / Programming, Cable Television and Internet Services

Total Internet Subscribers(1)

2010

1,400
1,300
1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0

YoY

(1) Figures in thousands.

1
.
1
5
3
,
1

Fibertel is undoubtedly the broadband service
that offers the highest speed in the market
widely and at competitive prices. one of the main
differentiating features of Fibertel’s connectivity
service lies in the great broadband potential
of its services compared to the more limited
ADSL connectivity service offered by its main
competitors. In September 2011, it launched
the 30-mega downstream and 3 mega upstream
speed product, Fibertel evolution, becoming the
first Internet provider in the country in selling a
product of the new wideband generation: a new

technology that allows clients to surf the web at
substantially higher speeds.

As of December 31, 2011, Cablevisión had
1,327,000 subscribers to cable modem Internet
access in Argentina and abroad through its own
networks, 7,700 subscribers to the dial-up system
and 16,400 subscribers to other broadband
technologies. even though Cablevisión has these
3 technologies, its main focus and differentiating
feature is cable modem, in which market it has a
leading position under the brand Fibertel, being a
clear benchmark in its category.

19.8%

CABLe TV & INTerNeT ACCeSS / Commercialization and Customer Service

Commercialization
and Customer Service

Cablevisión uses several market positioning
mechanisms, including promotions, customer
service centre locations, newsletters about
the company, institutional information and
programming through its websites. It advertises in
the printing media and over its own broadcasting
signals. Cablevisión also publishes a free monthly
guide distributed to most of its cable television
service subscribers and a monthly magazine
called “Miradas”, which is sold to a portion of its
subscriber base.

Customer service is provided through an
integrated service center offering round-the-clock
support, with the aim of optimizing the customer
relationship. In this regard, it launched Sucursal
Virtual, a website that enables its subscribers to
interact with the company to follow procedures
that were previously carried out through a
telephone call or even in person. During 2011, it
launched the mobile version allowing access from
several web-enabled devices which do not require
a PC. This new tool is available in the AMBA
region and will become available in new locations
in 2012.

Subscriber base turnover rate for the year ended
December 31, 2011 was 15.1%, compared to
14.3% recorded in the previous year. During
the year ended December 31, 2011, Cablevisión
added 132,400 subscribers to its base compared
to 164,900 added in 2010.

Competition

Cablevisión competes in the cable television
segment against other cable television operators
and providers of other television services, including
direct, satellite and broadcast services. Given the
fact that licenses are granted on a non-exclusive
basis, Cablevisión’s systems have been frequently
subject to overlapping of one or multiple competing
cable networks; in addition to the satellite service
which is available throughout its extent. Free
broadcasting services are currently available to
Argentina; in the AMBA region, these services
primarily include four private television signals
(one of them is controlled by Grupo Clarín) and
its local subsidiaries and a national state-owned
television signal. Additionally, under a project

aimed at implementing the Argentine Terrestrial
Digital TV System, the National Government
handed out digital set-top units among certain
sectors of society that allow free access to certain
signals.

which had already been selling 3G technology,
started to offer high-speed Internet services
through fiber optics. Therefore, the Internet access
segment faces fierce competition comprised by
several providers in an ever-growing market.

Strategy

The long-term business strategy for the cable
television and Internet access segment involves
an expansion of the cable television and Internet
broadband connectivity subscriber base, focusing
on maintaining the highest speed in the market
and stressing customer service and the brand.
This strategy also
in
involves
technology, and broader investments intended to
streamline a flexible network architecture serving
as a platform for developing additional video
Internet and voice services to realize the potential
provided by technology convergence.

improvements

The Argentine cable television industry has
more than 700 operators. The most significant
competitors are Telecentro S.A. located in the
AMBA region and DIreCTV (DTH technology).
Both companies compete against Cablevisión
nationwide.

Cablevisión can effectively compete against other
providers of cable television services on the basis
of a competitive price, a higher number of quality
programs and the customer service it renders
through its call-center. It also seeks to capture
and retain subscribers through customer-service
oriented policies.

Two major competitors (Arnet and Speedy) are
identified in the high-speed Internet access
segment; each of them related to one of the
country’s two fixed telephony providers. These
companies also render 3G services through their
brands Personal and Movistar, respectively. Claro,

16 17

PrINTING & PuBLISHING

Grupo Clarín, through Arte Gráfico editorial Argentino
S.A. (“AGeA”), is the main newspaper publisher in
Argentina and one of the most prominent editorial
content producers in Latin America.

out of Grupo Clarín’s total sales in 2011, the printing
and publishing segment accounted for Ps.2,159
million, taking into consideration intersegment
sales. This segment derives revenues primarily
from the sale of advertising, copies of newspapers
and magazines and optional products.

Arte Gráfico editorial Argentino

AGeA publishes Clarín, the flagship Argentine
newspaper and one of the most important in terms
of circulation in the Spanish-speaking world,
olé, founded in 1996, the first and only sports
newspaper of its kind in the Argentine market, the
free newspaper La razón and the newspaper MuY
launched in 2011. It also publishes the magazines
Genios and Jardín de Genios with a high penetration
rate in the schoolchildren’s segment; the magazine
elle; Ñ, a cultural magazine that reflects all cultural
news and trends; revista Pymes, aimed at small
and medium-sized entrepreneurs; and Diario de
Arquitectura, aimed at the construction sector,
architects and designers.

Through Artes Gráficas rioplatense S.A. (“AGr”),
Grupo Clarín is also engaged in color printing,
publishing and distribution activities. AGr prints
Viva, Clarín’s Sunday magazine, and carries out
other production activities for AGeA and for third
parties, including installment books, telephone
directories and flyers.

AGeA leads the online classified advertising
market through its vertical sites: Autos, Inmuebles,
empleos, and has a leading position in the Internet
content market through its websites Clarin.com,
olé.com.ar, revistaenie.clarin.com, and ieco.com,
among others. Through its subsidiary and controlled
company, Tinta Fresca ediciones S.A., the Company
is engaged in the textbook editorial market.

NET SAlES

(In millions of Ps.)

2010

2,200

2,000

1,800

1,600

1,400

1,200

1,000

800

600

400

200

YoY

PrINTING & PuBLISHING

ADjuSTED EBITDA

(In millions of Ps.)

325

300

275

250

225

200

175

150

125

100

1
.
7
5
2

Printing &
Publishing

2010

7
.
8
5
1
,
2

Printing &
Publishing

19.7%

YoY

(15.3%)

18 19

PrINTING AND PuBlIShING / Diario Clarín

Diario Clarín

With a long-standing journalistic and commercial
leadership consolidated in its 65-year track-record,
Clarín is the most prominent Argentine newspaper
in terms of outreach, influence, circulation and
advertising.

The success of its prestigious editorial line lies
in its identification with the needs and emotions
of its audience through a plural and independent
journalistic style that enables the most diverse
opinions. Clarín’s approach to reality is in tune
with its audience, supporting this bond with the
responsibility and credibility that characterizes
its journalists. Its extensive and thorough
investigations, approaches and analyses are
conveyed in clear and direct language, providing
its readers with easy access to the different
sections and issues.

During 2011, its daily circulation reached almost
288,000 copies, a volume 1.7 times higher than
its closest competitor. On Sundays, over 595,000
copies are sold, which places it among the major
Sunday newspapers of the world. According to the
Newspaper and Magazine Circulation Verification
Institute (“IVC”), in 2011, Clarín had a 40% share
of the newspaper market in the City of Buenos
Aires and the province of Buenos Aires and an
11% share in the provinces. On a national level, it
had a 25% market share.

Given its broad circulation and reach to all social
classes, Dario Clarín leads the print media
market. It is ranked first in terms of advertising
revenues, sold advertising space and also leads
in all advertising categories (display, special
section and classified ads). In 2011 Diario Clarín’s
advertising sales reached Ps.858 million, a 10%
increase compared to the previous year.

From an editorial perspective, Clarín reaffirmed
its long-standing journalistic leadership. Its in-
depth coverage of this year’s most outstanding
news revealed once again the production quality
of its reports and the depth of its approaches and
insights. The work of the paper’s investigation
team, the constant proposal of new editorial

operating Statistics - PrINTING AND PuBLISHING

Circulation (1)

Circulation share % (2)

Advertising share % (2)

2011

331.2

40.0%

54.0%

2010

360.8

43.5%

54.7%

YoY

(8.2%)

(1.2%)

(1) Average number of copies according to IVC (including Diario Clarín and Olé).

(2) Share in Buenos Aires and Greater Buenos Aires Area (AMBA) Diario Clarín. Source: AGEA and IVC.

(3) Share in Buenos Aires and Greater Buenos Aires Area (AMBA) Diario Clarín. Source: Monitor de Medios Publicitarios S.A.

products and the launch of new publications
continue to reflect the work of the greatest team
of journalists in Argentina.

Also this year, Grupo Clarín’s journalists and
media once again received prestigious awards
and acknowledgments. In 2011, Clarín.com
received again the rey de españa award, the most
important recognition to the Spanish-speaking
press. In the category “best approach over the
Internet”, in the same way as in 2010 Clarín.com
won the rey de españa award for “ruta 66”, a
multimedia special production by María Arce and
Paula Lugones, this year the price was awarded
to an interactive infographic on the historical
trial referred to as Juicio a las Juntas (the legal
action brought against the first three military
junta). A team led by Pablo Loscri, from Clarín’s
Arts and Infographics Department, did an amazing
job in reconstructing each and every instance of
the historical trial against the military junta in a
multimedia special site at Clarín.com.

In 2011, Diario Clarín offered outstanding
promotions that increased interaction with
readers, among them, the sixth edition of the
game “el Gran DT”. with over 8 million unique
users, more than 40 million visits, almost 500
million page views, an average time on site
of 10:21 minutes and visits from over 140
countries, www.grandt.com.ar continues to be
a massive and one of the most important pieces

in Argentina. Among

of entertainment
the
year’s milestones, in April 2011, the economic
supplement ieco launched the second optional
“Series Pocket Mentor”, a collectible product,
jointly with the Harvard Business review. Diario
de Arquitectura continued to launch high-quality
collectible products, such as, “Nueva Arquitectura
Argentina” and “Maquetas de Arquitectura”.
During the year, Clarín announced the latest
winners of the ArQ award which recognizes the
best Argentine architectural work of the last five
years on a regional basis. The contest awards the
best architectural projects in each region and will
have a final winner nationwide.

The Company continued to offer 10 regional
supplements which are published every Thursday
at an additional per copy price of Ps.0.50, with
almost full coverage in the Province of Buenos
Aires. The Company also published two regional
supplements on a monthly basis (Pilar and Moreno-
Luján-Gral. rodríguez) distributed for free. In
December, the company launched “Anuario 2011”,
a special edition featuring the most important
events of the year in the regional newspapers.
In April 2011, the Company introduced the sports
regional supplements Norte, oeste and Sur which
are published on a weekly basis.

As to sports, in addition to the game el Gran
DT, in 2011 special supplements were published
covering prominent events such as the Dakar

PrINTING AND PuBLISHING / Diario Clarín

rally, the America Cup, the Davis Cup, the ATP de
Buenos Aires Tournament and the rugby world
Cup in New zealand. Diario Clarín also published
the traditional products and special football
tournament guides. Diario Clarín’s newsroom
continued to work closely with the newsroom
of Clarin.com Deportes, producing multimedia
content and sharing knowledge, which enriched
news coverage and content.

20 21

PrINTING AND PuBLISHING / Diario Clarín

Diario Clarín also continued to build upon the
achievements attained by the cultural magazine
Ñ, reaching average sales of 41,000 copies
per issue. During the year, several initiatives
were carried out, aimed at engaging readers
through the launching of collectible products, the
creation and sponsorship of forums comprising
different cultural issues and involvement in and
sponsorship of major cultural events. “Biblioteca
Patricia Highsmith”, “el boom antes del boom”
and “Grandes maestros del jazz” are the most
outstanding collectible products. on June 25,
revista Ñ distributed “Sábato textual” together
with its monthly issue. This is a free supplement
which, on occasion of the newspaper’s 100th
anniversary, makes a historical account of its
lines of thought, through columns, articles and
interviews published at Clarín throughout the
decades.

In its seventh year, revista Pymes, continued to
strengthen its growth. During 2012, it published
the collectible product “Comunicación y ventas”.

In order to continue to add value to its readers,
Diario Clarín constantly keeps up to date and
offers a wide range of editorial products together

with the core product, addressing the need to
satisfy an increasing segmentation among the
diverse demographic groups. It was an intense
year in terms of collectible and optional products,
consolidating Grupo Clarín as one of the major
book editors of Argentina.

Clarín’s products continued to set trends, and
brand
loyalty activities contributed to the
consolidation of readers’ strong relationship with
the brand. Further efforts were channeled into
strengthening the bond with advertisers, bringing
together new sectors and identifying their needs.

The highlights were: Aventuras de Películas
de Disney; Superman; Los secretos del gran
asador 2011; Libros bilingües Inglés-español;
Prehistoria; enciclopedia Clarín del estudiante
Mundo Actual; el gran libro Clarín del Tejido;
Libros Imprescindibles para el colegio; Grandes
Fotógrafos de National Geographic; Historia de
las elecciones Argentinas; Grandes pinturas del
Museo Nacional de Bellas Artes; enciclopedia de
los animales y la naturaleza National Geographic;
Activity Disney; Novela Gráfica; Colección Messi;
el gran libro Clarín de la Moda; el gran libro
Clarín de las Pizzas; Crochet; el gran Libro Clarín
del embarazo; el Gran Libro de la Belleza Clarín
2011; Viaje al corazón y viaje al cerebro; Cocina
familiar rica y divertida por Jimena Monteverde;
Las aventuras de Hijitus; Animales en acción;
Grandes Museos de europa; el Gran libro Clarín
de la Decoración 2011; Guía para conocerte más
y mejor.

Clarín organized new editions of its renowned
Clarín Awards, honoring its strong commitment
to the promotion of Argentina’s best in the
cultural and sports fields. To this effect, the 13th
consecutive “Premio Clarín de Novela” ceremony
was held, where Luis Lozano was awarded for his
novel “Lloverá sobre nosotros”. The novel was
published by Clarín-Alfaguara and the author won
Ps.150,000.

Clarin.com is a news and opinion portal with
updates in real time and free access on a 365/24/7
basis, which has been online since 1996. In addition
to the full version of the printed newspaper and
its archive, Clarin.com features ongoing updates
of news produced and published by its own
journalists. During 2011, Clarin.com received a total
of 138 million unique visits, with a monthly average
of 11.5 million. During 2011, ole.com received an
average of 7.7million unique visits.

PrINTING AND PuBLISHING / other newspapers

other Newspapers

La razón, the first-ever free distribution
newspaper, is distributed in all subway and train
lines in the City of Buenos Aires, as well as in bars
and in highway tollbooths within Buenos Aires.
Building upon the concept that “La razón is a
travelling companion”, as it does every summer,
the newspaper sent copies throughout the season
to Mar del Plata, Pinamar and Villa Gesell.

After thirteen years of existence and with an
average daily circulation of 42,600 copies, olé,
the first and only Argentine sports newspaper,
continues to consolidate its market positioning. It
is the fourth largest newspaper in Buenos Aires
in terms of circulation. Since its inception, it
has revolutionized reading habits and managed
to attract not only sports fans, but also a new
generation of young readers, offering advertisers
an opportunity to reach a specific market.

During 2011, La razón discontinued Neuquén’s and
Saturday’s editions. It also launched the 8-page
weekly supplement “Suplemento Semanal Cultural
de la Ciudad”.

In May, Clarín launched MuY, a dynamic, visually
designed and entertaining newspaper, which
features news in addition to regional pages and
sports and show business sections. with a “TV-

format” design, the newspaper summarizes the
most resounding police cases and breaking news
on soccer clubs and celebrities.

Magazines

In 2011 the Company continued to issue the
magazine Genios, which has 13 years in the
Argentine market. with the children and school
in mind, this magazine was created with the
aim of integrating content for children, parents,
school and society, combining education with
entertainment. Since it was launched in March
1998, it has led the children’s magazine segment.
Its editorial offering is always updated at the
beginning of each academic year, presenting new
sections, updated school materials and collectible
books prepared by experts. During 2011, Genios
consolidated its efforts in the website genios.com.ar
and collectible products, such as, Mis proyectos
escolares and Aventuras de película de Disney,
among others.

Jardín de Genios is the monthly publication aimed
not only at pre-school children and those attending
the first years of primary school, but also at parents
and teachers. In its annual launch, it published the
magazine “edición de oro”, with more pages and

a square-shaped spine, and the supplement “Guía
para Padres”, that came with a free kindergarten
backpack. The magazine also presented the first
book of the new collectible “La Casa de Mickey
Mouse”, which became a best-seller.

During 2011, “Tiki Tiki”, a magazine aimed at
children aged 8 through 14 and adolescents,
continued to strengthen its position. In April, the
magazine launched special editions, such as, Soy
leyenda, XL del fútbol Argentino con anteojos 3D
and collectible products, such as, Figus Virtuales
and Tikifigus, among others.

The magazine elle reaffirmed its leadership in
the high-end advertisers segment. In 2011, its
circulation reached a monthly average of 32,000
copies. In May and october, the company also
published the magazine elle Decoración.

The bi-monthly magazine Clarín rural revista
continued to strengthen its position as a
management tool for the productive sector
with all the solutions and technologies aimed at
agricultural businesses.

Also in 2011 the company continued to publish the
monthly magazine-catalogue, Shop & Co, which
includes discount coupons on important brands.

22 23

Tinta Fresca

Tinta Fresca ediciones S.A. (“Tinta Fresca”) is
an Argentine publishing company engaged in
textbook publishing for the different stages of the
Argentine education system. Tinta Fresca looks to
place books as central elements of the teaching
and learning processes and proposes to use
books as effective and updated tools for teachers
and students. Its strength is to provide access
to textbooks to the largest number of students
possible, at competitive prices, relying on a sales
force capable of promoting its products by visiting
teachers throughout the country and with points
of sale nationwide.

In 2011, Tinta Fresca continued to improve its market
position. Tinta Fresca strengthened its editorial
offering with the launch of the series “Colorín
Colorado 1, 2 y 3”; and the series “Matemática
1, 2, 3 y 7” featuring Sendra’s drawings, which
completed the series “Matemática 4, 5 y 6”
launched in 2008. In line with school manuals,
Tinta Fresca launched the series “Quiero aprender
4, 5 y 6” which features the character Gaturro
created by caricaturist Nik. It also launched
collectible products, such as, “efemérides” and
“el gran libro de la práctica docente”, among
several other value added projects.

As an outstanding and special contribution to
society, the Company made available at Clarín.com
a digital and free version of “Diccionario
integral del español de la Argentina”, released
in April 2011. users may easily check the full
educational and cultural quality content of the
dictionary.

Artes Gráficas rioplantense

AGr meets certain special printing needs of Clarín
and olé (magazines, optional and collectible
products, among others), and also publishes large
volumes of graphic material for third parties.
It is the leading printing services company in
Argentina.

In 2011, AGr retained its leading position in
the sector with net sales of Ps.266 million. The
company continued to exploit one of its main
strengths: its participation in the entire value
chain of the printing industry, which enables
it to offer comprehensive customer service,
including drafting, prepress, variable printing,
offset printing, finishing and distribution. AGr

strengthened its presence in the foreign market,
where sales reached Ps.6.5 million.

In May 2000, AGr entered into an agreement with
the Techint Group, acquiring 50% of Impripost
Tecnologías S.A. (“Impripost”). Impripost is mainly
engaged in the overall production and printing of
invoices, advertising brochures, forms, labels and
cards. It also provides envelope-stuffing services
for mass mailing.

uNIr S.A. (“unir”) is a company engaged
in wholesale mail reception, classification,
transportation, distribution and delivery services.
As from August 25, 2008, AGeA holds a 93.41%
direct controlling interest in unir. In 2011, unir
totaled sales of Ps.60 million, a 39% increase
compared to the previous year.

During the year and as stated in Note 9.1.f to
the Financial Statements, the Company acquired
an equity interest in Cúspide Libros S.A. through
AGr. Through this acquisition, it launched
Librocity.com, the on-line book store of Grupo
Clarín, in partnership with the retail bookstore
chain Cúspide. The book store features a broad
and assorted catalogue and an advanced search
engine. The site offers several payment methods
and payment against delivery.

CIMeCo

Compañía Inversora en Medios de Comunicación
S.A. (“CIMeCo”) was organized in 1997 with the
aim of acquiring equity interests in Argentine
and foreign newspapers, seeking to preserve the
regional journalism industry, blending experience,
synergy and economies of scale. To date, CIMeCo
holds a majority interest in two of the three
largest regional newspapers in Argentina: La Voz
del Interior (Córdoba) and Los Andes (Mendoza).

Diario Los Andes was able to maintain its
leadership in the province with special
publications, events and special supplements.
It continued to develop its loyalty program Los
Andes Pass, retaining a 62% of the province’s
newspaper circulation and gaining a 42% share in
the total advertising market of the province.

La Voz del Interior, a 106-year old newspaper, has
a strong presence in the province of Cordoba. Its
circulation levels remained steady during 2011,

PrINTING AND PuBLISHING / Papel Prensa

with a remarkable increase in the sale of optional
products and very good revenues performance in
the Internet and other digital businesses. Also
during the year, CIMeCo launched “La Voz 365”, a
subscription and loyalty plan that offers a reward
card for subscribers. In editorial terms, CIMeCo
continued to move forward with the convergence
process started in 2008. The progress made
translated into a significant increase in the
number of unique users in La Voz network, which
by the end of 2011 exceeded the 3 million mark
per month, whereas the site VoS.com.ar hit the 1
million users mark in January 2012. The opening
to social networks and, in general terms, to a
dialogue with the audiences were other important
highlights.

During 2011, Comercializadora De Medios Del
Interior S.A. (“CMI”), a subsidiary engaged in
the sale of advertising, consolidated its digital
business units and increased to 24 the number of
commercialized web sites and strengthened its
share in the total advertising pie.

After more than eight years in the market, the
magazine rumbos has remained the Sunday’s
in the
magazine with strongest presence
provinces and is distributed together with the
main newspapers, including, La Voz del Interior,
Diario Los Andes, el Diario de Paraná, Época de
Corrientes and el Liberal de Santiago del estero.

Papel Prensa

Papel Prensa is the first producer of newsprint that
is wholly owned by Argentine capital. It began its
operations in 1978 and is currently the largest
Argentine producer of newsprint, with an annual
production capacity of approximately 170,000
tons. As of December 31, 2011, the shareholders
of Papel Prensa were AGeA (37%), CIMeCo (12%),
S.A. La Nación (22.5%), the Argentine federal
government (27.5%), and other minor investors
(1%).

products in the city of Mar del Plata, thus becoming
the first exhibition held out of the city Buenos
Aires. This achievement coupled with the results
from previous editions encouraged the company
to double the site surface where the traditional
exhibition is held in Buenos Aires to 18,000 square
meters, with 400 expositors and 100,000 visitors.
After the 5-day event held in September, Caminos
y Sabores consolidated as Argentina’s largest fair
exhibiting typical food, crafts and tourism.

In 2010, the Company also held the seminar
ADMITe in Venado Tuerto, province of Santa
Fe, and offered courses given by renowned
professors of the agricultural sector, with training
in technology and machinery.

In 2007, AGeA entered into an agreement with
S.A. La Nación for the organization of expoagro,
a new agro-industrial fair, improving the results
that had been obtained until then by Feriagro, and
achieving a record-high number of exhibitors. In
2011, the exhibition, held from March 2 through
March 5 in Corredor Productivo Baradero - San
Pedro, was a success and received more than
123,000 visitors.

Papel Prensa has implemented production policies
based on the procurement of strategic inputs
without contributing to the depletion of natural
resources. To this end, the paper mill recovers
raw materials from the recycling of returned
newspapers, instead of using virgin fiber. In 2011,
Papel Prensa sold 167,265 tons of newsprint.

Ferias y exposiciones Argentinas

one of the main activities of Ferias y exposiciones
Argentinas is the organization of Caminos
y Sabores, an exhibition intended to foster
Argentina’s gastronomy and handicrafts and
promoting the region’s most important tourist
destinations. In 2011, Caminos y Sabores
partnered with 80 small producers from different
regions of the country who introduced their

24 25

BroADCASTING & ProGrAMMING

ADjuSTED EBITDA

(In millions of Ps.)

300

275

250

225

200

175

150

125

100

2010

5
.
5
8
2

and Progra m ming
Broadcasting

7
.
3
6
4
,
1

and Progra m ming
Broadcasting

30.1%

YoY

35.0%

26 27

Grupo Clarín is also the leading company in the
audiovisual broadcasting and programming
segment. Through Artear, it holds the license to
broadcast Canal Trece, one of the two largest
broadcast television channels in Argentina, and
leads the segment in terms of advertising share
and prime-time audience share. It also has a
presence
in
Córdoba (Telecor), Bahía Blanca (Telba), Bariloche
(Bariloche TV), and río Negro (radio Televisión río
Negro). Grupo Clarín also produces and sells some
of the most popular cable television networks.

in broadcast television stations

Its audiovisual broadcasting and programming
array includes agreements and equity interests
in the main television and film producers, such as
Pol-ka Producciones, Ideas del Sur and Patagonik
Film Group. Grupo Clarín also owns prominent
radio stations, such as Mitre AM 790, La 100 (FM
99.9), both in Buenos Aires, and, more recently,
Mitre AM 810 in the province of Córdoba.

Grupo Clarín also has a strong stake in sports
commercialization and broadcasting rights, mainly
soccer and motor racing, directly and through joint
ventures.

out of Grupo Clarín’s total sales in 2011,
the broadcasting and programming segment
accounted for Ps.1,464 million, taking into
consideration intersegment sales.

NET SAlES

(In millions of Ps.)

1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0

YoY

2010

BroADCASTING & ProGrAMMING / Artear

Artear

Amidst a scenario marked by industry challenges
and strong competition, Artear was able to
achieve its goals in 2011. Its share of the
traditional advertising market of broadcast
television reached 35%.

audience rating. Canal Trece’s news programs
-“el Noticiero de Santo”, “Telenoche” and “en
Síntesis”- further validated their already existing
recognition and credibility with audience ratings
that led their respective time slots.

In 2011, Canal Trece was the leading channel
overall in broadcast TV. Since 2006 Canal Trece
had been leading only the Prime Time, where
most advertising revenues are concentrated.
It achieved such leadership with 10.5 rating
points from Monday through Sunday from 12:00
PM through 12:00 AM, against 9.5 rating points
achieved by its closest competitor. Canal Trece
had an overall average of 16% and a share of over
40% at Prime Time. Its professionalism, artistic
quality, innovative proposals and technological
developments continue to distinguish it as the
most prominent audiovisual medium in the market.

As far as its programming is concerned, during
2011 Canal Trece combined fiction, information
and entertainment in a diversified offering
which places it not only as the general audience
leader, but also as leader at high and middle
socioeconomic levels, allowing it to reach highly
demanded targets and, therefore, to lead the
advertising market.

“Herederos de una Venganza”, “Show Match”,
“Los Únicos” and “el Puntero” led audience
ratings. As regards news programs, “Arriba
Argentinos” continued to consolidate its morning

with respect to cable television channels, TN
achieved the highest audience share throughout
the year across all time slots. on several
occasions, it outperformed broadcast stations.
Several talk shows stood out, such as “el Juego
Limpio”, “Palabras más, Palabras menos”,
“Código Político”, “Desde el Llano”, “Argentina
para Armar”, “otro tema” and “A Dos Voces”.

Artear further strengthened its TV slots, seeking
to offer diverse options in terms of information
and entertainment. The Spanish
language
music channel “Quiero Música en mi Idioma”
was quick to lead audience ratings in the music
genre. ”Volver” continued to offer the best of
classic and vintage Argentine films and television
shows and reaffirmed its role as a 100% national
channel that preserves our history with the
highest technology. Magazine and Metro, general
interest cable channels, continued to develop their
programming criteria through thematic modules
and standardized broadcasting. Canal Trece
Satelital, Canal Trece de Buenos Aires channel,
continued to focus on local productions and on
including a significant number of in-house national
productions in its programming.

operating Statistics - BroADCASTING AND ProGrAMMING

Advertising Share (1)

Audience Share (2)

Prime Time

Total Time

2011

36.6%

42.2%

33.0%

2010

36.1%

42.2%

31.0%

YoY

1.3%

0.2%

6.4%

(1) Company estimate, over ad spend in Ps. in broadcast TV for AMBA region.

(2) Share of broadcast TV audience according to IBOPE for AMBA. Prime Time is defined as Monday through Friday from 8 pm to 12 am.

Total Time is defined as Monday through Sunday from 12 pm to 12 am.

28 29

BROADCASTING & PROGRAMMING / Artear

During 2011, the most prominent show business
and general interest events were broadcast, such
as, u2, Alejandro Sanz, Shakira, Joaquín Sabina,
Justin Bieber and Rod Stewart concerts, among
others; as well as the 20th edition of the traditional
campaign “un Sol para los chicos, aimed at raising
funds for uNICEF, held at Luna Park.

Committed to being always at the frontline and
with a view to permanently improve quality image,
on May 16, 2011, Canal Trece started to broadcast
in High Definition through “El Trece HD” (Signal
619 in Cablevisión’s grid), and has since become
the first broadcast signal in producing all of its
content in High Definition. This success is the
result of intensive investment in equipment and
professional training. El Trece had been the first
signal in piloting a high-definition system since
September 25, 1998 and used it uninterruptedly
since 2000 through 2009.

Artear continued to produce fictional content for TV
series and motion pictures through Pol-Ka, Ideas
del Sur and Patagonik Film Group. “Herederos de
una Venganza”, “Los únicos” and “El puntero”
are the highlights in fiction production that led
audience rating. Pol-ka became the first national
producer in producing all of its programming in
high definition (HD).

In addition, the Company focused significant
efforts aimed at developing activities related to
the commercialization, organization and broadcast
of sports events through TyC Sports, mainly
football and motor racing.

BROADCASTING & PROGRAMMING / Mitre

Mitre

In 2011, AM Mitre 790 reaffirmed its track record
and consolidated its second place in the ranking
of audience share during the entire year, reaching
an audience share of 18 points.

The radio talk show “Primera Mañana”, hosted
by Nelson Castro with a group of prestigious
columnists, stood out among Radio Mitre’s
programming. “Hola Chiche”, hosted by Chiche
Gelblung, continued to renew the morning slot
with a lineup that combines journalism, general
news coverage and enjoyable and smart humor.

In the afternoon slot, Radio Mitre continued with
programs that have strong journalistic content,
such as “El Club de la tarde” hosted by Ernesto
Tenembaum, “La Otra Pata”, hosted by Marcelo
Zlotogwiazda, and “Lo que queda del día”, hosted
by Horacio Caride.

La 100 consolidates its leadership in the FM
radio segment, with an entertaining, smart and
innovative proposal based on programs led by
famous artists and good music. By year-end, La
100 led the audience share with growth in almost
all of its programs. In 2011, the shows “El Show
de la Noticia”, hosted by Roberto Pettinato in
his eighth season, and “Lalo por hecho”, hosted
by Lalo Mir, stood out once again. To further
consolidate its bond with listeners, the radio
station continued to organize acoustic concerts
and on-location broadcasts from its mobile
studio, featuring highly-acclaimed national and
international artists.

Finally, of remarkable note is the growth
experienced by Cienradios.com.ar, a site that
was conceived as an extension of our brands to
the web that now stand on their own. It entails

the development of an infinite concept of the dial
and is unique in Latin America. The user may
choose among a wide offering of broadcast radio
stations and other stations, specially designed
for the Internet with segmentations of singers,
bands, music from different decades, the music
presented by the FM radio station hosts, folklore,
tango, romantic music and other rhythms.

During 2011, the presence of Mitre AM 810 was
also consolidated in the province of Córdoba
as the second radio with the highest audience
share. With a permanent staff in the city and
its own news service, Mitre AM 810 developed
comprehensive coverage of news comprising
Córdoba, Argentina and the world.

30 31

DIGITAL CONTENT & OTHERS

Revenues in this segment are derived from the sale
of advertising on Internet web sites and portals
and the provision of administrative and corporate
services by Grupo Clarín and its subsidiary GC
Gestión Compartida S.A. (“GCGC”) to third parties
and other subsidiaries. They also include digital
content production through Contenidos de Medios
Digitales (“CMD”).

Out of Grupo Clarín’s total sales in 2011, this
segment accounted for Ps.283 million, taking into
consideration intersegment sales.

Net SaleS

(In millions of Ps.)

adjuSted ebitda

(In millions of Ps.)

300
280
260
240
220
200
180
160
140
120
100
80
60
40
20
0

YoY

2010

0
.
3
8
2

Digital Content
and Others

2010

8
7
6
5
4
3
2
1
0
-1
-2
-3
-4
-5
-6

2011
Digital Content
and Others

(

)

17.5%

YoY

(107.6%)

32 33

DIGITAL CONTENT & OTHERS

Digital content

Grupo Clarín is the leading producer of digital
content. Through CMD and Clarín Global, the
Company developed the broadest network of portals
and digital content in Argentina, covering news,
entertainment, sports, classified advertisements,
e-commerce, digital photography, video, blogs,
chat rooms, music, mobile content (ringtones, SMS
and games) and a browser. This network seeks to
replicate on the Internet the presence and relevance
of Grupo Clarín’s several offline media.

Given the fact that, in line with the corporate
strategy, the exploitation of Clarín and Ole websites
that were previously operated by Grupo Clarín was

transferred to another company, goals have been
redefined in order to strengthen the positioning
of other sites, such as, Todo Noticias, Cienradios,
Ciudad and EltreceTV in terms of traffic and
revenues.

TN.com.ar, the website of Todo Noticias developed
by CMD, registered amazing audience share
growth at year-end. The site consolidated as the
most visited website related to a TV signal and
was also the news site that experienced strongest
growth. One of the turning points was the overall
redesign of the site in May 2011.

Operating Statistics - DIGITAL CONTENT AND OTHERS

Page Views(1)

unique Visitors(1)

2011

613.9

25.9

2010

534.7

21.0

YoY

14.8%

23.3%

(1) In millions. Average. Source IAB and Company Estimates.

34 35

During the year, Interpatagonia SA, a company
where CMD holds an 80% equity interest, managed
to consolidate its website Welcomeargentina.com,
winner of the Mate.ar golden award to the best
website in 2011.

At the same time, Club Cupón, the on-line discount
site completed its first year of operation. The

Company also operated other e-business sites,
such as, Confronte and Mas Oportunidades, and
contextual adverting sites under the iAvisos brand.

with its international expansion process. Mundo
Gaturro already has 3 million registered users.

Also in 2011, through Clawi SA, a company where
CMD holds a 51% equity interest, Grupo Clarín
managed to enter the Spanish market with the
on-line game Mundo Gaturro, and moved forward

Concerning launches, CMD entered the direct sale
market through its brand Mr. Sale and experienced
sustained growth throughout the year, both
in terms of variety of items for sale and sales
volume. Through its brand Yuisy, CMD launched

ArgenProp

Buscainmueble

Canal 13

Clasificados

Clarín.com

Cienradios

Ciudad

Clarín Blogs

Clubcupón

Confronte

De Autos

De Motos

Entremujeres

Espectáculos

Genios

Guía de la Industria

Grupo Clarín

iEco

Imagena

Interpatagonia
La Razón

Rolling Ranch, the first videogame fully developed
by CMD that features 80 levels and HD imaging,
and is supported by Iphone, Ipad and Ipod. CMD
also launched the videogame Halloween Hunter,
available for all Apple mobile devices.

Other Services

Through GCGC, Grupo Clarín renders specialized-
process outsourcing services to medium and
large companies. The services rendered, which
include payroll management and processing and
implementation of related processes, as well
as human resources management, are oriented
to optimize quality and provide innovative
management tools.

DIGITAL CONTENT & OTHERS / Other services

During 2011, total sales increased by 20% compared
to the previous year. The company continues to
bolster the services offered, increasingly focusing
on a customer-driven approach, as well as on
strengthening improvement processes.

Más Oportunidades

Quieromimúsica

Mundo Gaturro

Nimbuzz

Nómade

Mublet
Olé

Revista Ñ

Shop1

Tangocity

Tebusco

Tipete

TN y la Gente

Toda Pasión

T&C Sports

ubbi

Vía Restó

Yuisy

VXV

Welcome Argentina

36 37

CORPORATE GOVERNANCE, ORGANIZATION
AND INTERNAL CONTROL SYSTEM

CORPORATE GOVERNANCE, ORGANIZATION AND INTERNAL CONTROL SYSTEM

Grupo Clarín’s Board of Directors is responsible
for the Company’s management and approves its
policies and overall strategies. According to the
Company’s By-laws, the Board has ten permanent
members and ten alternate members, appointed
on an annual basis at the Regular Shareholders’
Meeting. The By-laws also provide for the
appointment of four independent directors, two
permanent members and two alternate members,
appointed in accordance with the requirements of
National Securities Commission (“CNV”).

Day-to-day decisions relating to Grupo Clarín’s
businesses are taken by an Executive Committee
formed by three members, appointed and
supervised by the Board of Directors.

MEMBErS OF ThE BOArD OF DIrECTOrS

héctor horacio Magnetto

José Antonio Aranda

Lucio rafael Pagliaro

Alejandro Alberto Urricelqui

Jorge Carlos rendo

Pablo César Casey

Muneer Satter

David Castelblanco

Lorenzo Calcagno

Alberto César José Menzani

Chairman

Vice Chairman

Director

Independent

Director

Independent

Director

Subsequent to year-end, the Company was
notified of and accepted the resignation to the
position of Permanent Director designated by
Class C shareholders of Mr. Muneer Satter and
Mr. David Castelblanco, as well as the resignation
of Mr. Luis María Blaquier. The Board of Directors
decided to call for an Extraordinary Class C
Shareholder’s Meeting to be held on March 26,
2012, in order to appoint a Permanent Director and
two Alternate Directors and a Permanent and an
Alternate Member of the Supervisory Committee.
The meeting was not held due to lack of a quorum,
therefore the Directors and Members for the
mentioned positions were elected by the Annual
General Meeting on April 26, 2012.

38 39

CORPORATE GOVERNANCE, ORGANIZATION AND INTERNAL CONTROL SYSTEM

ExECUTIVE COMMITTEE

héctor horacio Magnetto

José Antonio Aranda

Lucio rafael Pagliaro

Chairman

Vice Chairman

Director

Grupo Clarín also has a Supervisory Committee
comprised of 3 permanent members and 3
alternate members, who are also appointed on
an annual basis at the Regular Shareholders’
Meeting. The Board of Directors, through an Audit
Committee, is in charge of the ongoing oversight of
all matters related to control information systems
and risk management, and issues an annual report
on these topics. The members of the Company’s
Audit Committee may be nominated by any
member of the Board of Directors and a majority
of its members must meet the independence
requirement set forth by the CNV.

AUDIT COMMITTEE

At year-end, the Audit Committee was

comprised as follows:

Lorenzo Calcagno

Alberto César José Menzani

Alejandro Alberto Urricelqui

Independent

Director

Independent

Director

SUPErVISOrY COMMITTEE

At year-end, the Supervisory Committee

was comprised as follows:

raúl Antonio Morán

Independent

Permanent Member

Carlos A. P. Di Candia

Independent

Alberto López Carnabucci

Independent

Permanent Member

hugo Ernesto López

Martín Guillermo ríos

Pablo Tonina

Permanent Member

Independent

Alternate Member

Independent

Alternate Member

Subsequent to year-end, the Company was
notified of and accepted the resignation to the
position of Permanent and Alternate Member of
the Supervisory Committee designated by Class C
shareholders of Mr. Alberto López Carnabucci and
Mr. Pablo Tonina. As mentioned above, the Board
of Directors decided to call for an Extraordinary
Class C Shareholder’s Meeting in order to appoint
a Permanent Director and two Alternate Directors
and a Permanent and an Alternate Member of the
Supervisory Committee. The meeting was not held
due to lack of a quorum, therefore the Directors
and Members for the mentioned positions were
elected by the Annual General Meeting on April
26, 2012.

To assist the Executive Committee in their daily
duties, Grupo Clarín organizes its activities
under an executive structure comprising: External
Relations Division; Corporate Finance Division;
Corporate Control Division; Corporate Strategy
Division; Audiovisual Content Division; Corporate
Human Resources Division; Corporate Affairs
Division; Digital Content Division.

The overall criteria used to appoint managers are
based on the background and experience in the
position and the industry, companies they have
worked for, age, professional and moral aptitude,
etc. The professional experience and background
of the main managers are disclosed to the general
public upon their appointment.

In order to identify opportunities and streamline
structures and systems with the aim of improving
processes and making informed decisions,
Grupo Clarín sets forth several procedures and
polices for the specific purpose of controlling
the Company’s operations. The areas responsible
for the Company’s internal controls, both at the
Company level and at the level of its subsidiaries
and affiliates, contribute to the safeguarding of
shareholders’ equity, the reliability of financial
information and the compliance with laws and
regulations.

Stock Information
and Shareholder
Structure

Grupo Clarín is listed in the Buenos Aires Stock
Exchange where it trades its shares, and in the
London Stock Exchanges, where it trades its
shares in the form of GDS.

london Stock

exchange (lSe) - ticker:

GCla

bolsa de Comercio

GCla

de buenos aires (bCba) - ticker:

GCla (bCba)

Ps.8.90

Price per share, December 30, 2011

GCla (lSe)

uS$5.00

Price per GDS, December 30, 2011

total

287.418.584

143.709.292

71%

Controlling Shareholders

20%
Free float

9%
Goldman Sachs

40 41

Compensation of the members
of the Board of Directors and senior
management

Compensation of the members of the Board of
Directors is decided at the Shareholders’ Meeting
after the close of each fiscal year, considering the
cap established by Section 261 of Law No. 19,550
and related regulations of the CNV.

Grupo Clarín has compensation arrangements
with all of its officers in executive and managerial
positions, which contemplate a fixed and variable
remuneration scheme. Fixed compensation is
tied to the level of responsibility attached to
each position and prevailing market salaries. The
variable component is tied to performance during
the fiscal year based on the objectives set at the
beginning of the year. Grupo Clarín does not have
any stock option plans in place for its personnel.

As mentioned in Note 13 to the parent company
only Financial Statements, on January 1, 2008
Grupo Clarín began to implement a Long-term
Savings Plan (“PALP”) for certain executives of
Grupo Clarín and its subsidiaries. Executives who
adhere to such plan will contribute regularly a
portion of their salary to a fund that will allow
them to increase their income at the retirement
age. Furthermore, each company matches the sum
contributed by such executives. This matching
contribution will be added to the fund raised by the
employees. under certain conditions, employees
may access such fund upon retirement or upon
termination of their jobs with Grupo Clarín.

Annual Shareholders’ Meeting

On April 28, 2011, Grupo Clarín held the fourth
Annual Regular Shareholders’ Meeting since
the Initial Public Offering of its shares. On
this occasion, the shareholders reviewed and
approved the accounting records for fiscal year
No.12 ended on December 31, 2010 and the
performance and compensation of the members of
the Board of Directors, the Supervisory Committee
and the Audit Committee. Among other things,
they reelected the permanent members and
alternate members of the Board of Directors and
said committees for the year 2011. The Company
distributed dividends for an aggregate amount
of Ps.120 million, representing 41.751% of its
nominal capital and Ps.0.41751 per share.

Dividend Policy

Grupo Clarín does not have a formal dividend
policy governing the amount and payment of
dividends or other distributions. According to its
By-laws and the Argentine Business Associations
Law, Grupo Clarín may lawfully pay and make
declarations of dividends only out of the retained
earnings stated in the Company’s annual Financial
Statements prepared in accordance with Argentine
GAAP and CNV regulations and approved at the
annual ordinary shareholders’ meeting. In such
case, dividends must be paid on a pro rata basis
to all holders of shares of common stock as of the
relevant record date.

GRuPO CLARÍN AND ITS CORPORATE
SOCIAL RESPONSIBILITY

GRuPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY

Our commitment

Since its foundation, Grupo Clarín has been aware
of its social responsibility as a company and as a
member of the media, and has strived to assume
such responsibility abiding by the laws, honoring
its active and sustained social and community
involvement and, especially, fulfilling its duty to
inform with honesty and accuracy.

Commitment to society is an inherent and essential
part of Grupo Clarín’s vision and mission statement.
The Company attaches special importance to the
relationship with its different audiences, which
acknowledge and validate its activities each
day and, over time, have established multiple
communication and interaction channels with
Clarín’s stakeholders.

From the standpoint of its audiences, readers
and society in general, Grupo Clarín’s media and
journalists work day after day towards respecting
and consolidating the people’s right to information;
combining high credibility with a comprehensive
journalistic and entertainment offering based on a
deep knowledge of the audience.

Transparency, standards
and guidelines

Through its commitment to the Global Compact
proposed by the united Nations, Grupo Clarín
seeks to intensify and, to a greater extent,
systematically embody the values and principles
that guide the Company’s daily work, particularly
those concerning labor, sustainable development,
and human rights.

Grupo Clarín also participates in several groups
and organizations, which gather other Argentine,
Latin-American and global media players and
stakeholders to share experiences, identify best
practices, and foster cooperation on the specific
issues that media companies address as part of
their social responsibility strategies. During 2011,

the Noble Foundation renewed its presence in the
“Grupo de Fundaciones y Empresas”, a space to
share knowledge and set standards in the field of
strategic social investment.

During the period of 2009-2012, Grupo Clarín
committed its participation and contributed to
the multi-stakeholder development of the Media
Sector Supplement for the Global Reporting
Initiative. The GRI guidelines act as a reference for
an extensive process, currently underway at the
Company, to further consolidate, identify and report
relevant information regarding the environmental
and social impacts, while establishing new goals
to strengthen its related initiatives and strategy.

42 43

GRuPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY

Grupo Clarín’s media companies are continuously
designing new means to engage with its readers
and audiences.

As the previous years, 2011 proved to be a specially
challenging year for freedom of expression in
Argentina. The Company supported numerous
initiatives to create awareness on the subject
and demonstrated its sustained commitment to
defending and promoting it.

Presently, most media in Argentina are either
state-owned or a significant portion of their
income directly depends on the increasing
government advertising expenditure. Those
are adverse conditions that can often pose a
threat for journalistic independence, freedom of
expression, access to information and plurality of
voices, all vital conditions for a sustainable and
democratic society. Therefore, the Company pays
special attention to guaranteeing its economic
independence by pursuing a sustainable business
model with diversified sources of income.

During this period, as historically, Grupo Clarín’s
revenues from government advertising have only
represented around 1% of the Company’s total
income.

In furtherance of transparency, the following table,
included in the Company’s 4Q & 2011 Earnings
Release, shows the sales breakdown by source of
revenue as a total figure and by business segment.

Grupo Clarín’s observance to the principles
included in all those guidelines is also outlined
in the Company’s Code of Ethics and “Guía para
la Acción”, a document which proposes models
for management, organization and roles, while
outlining Grupo Clarín´s policies and procedures
concerning labor, the environment and human
rights.

Freedom of expression and transparency are values
which are indispensable to the Company and its
professionals. Both principles are particularly
relevant in areas linked to news services. At Grupo
Clarín, each company commits to the quality, rigor

and transparency of its information and content.
News coverage and programs aim to be plural and
fair, reflecting the journalists’ efforts to inform
on facts and events in a balanced manner, while
allowing opinion regarding the parties involved.

Style guides, ethics manuals, news coverage
guidelines -including some for kidnapping and
hostage situations- and several other self-
regulations and commitments guide the different
activities of news and entertainment oriented
companies. This does not mean that every
issue, especially regarding content and editorial
view, is addressed as expected. For that reason

SALES BREAKDOWN BY SOuRCE OF REVENuE - DECEMBER 2011

(In millions of Ps.)

CABLE TV &

PrInTInG &

BrOADCASTInG &

DIGITAL COnTEnT &

ELIMInATIOnS

TOTAL

InTErnET ACCESS

PUBLIShInG

PrOGrAMMInG

OThErS

978.8

21.6

Advertising

Circulation

Printing

Video

Subscriptions

Internet

Subscriptions

Programming

Other Sales

77.6

4,478.9

1,364.4

416.0

1,184.3

650.5

249.7

74.2

355.0

129.9

total Sales

6,336.9

2,158.7

1,463.7

261.4

283.0

(129.5)

(35.9)

2,132.8

650.5

213.8

4,478.9

(3.2)

1,361.2

(128.0)

(193.1)

227.0

688.5

21.9%

6.7%

2.2%

45.9%

14.0%

2.3%

7.1%

(489.8)

9,752.5

100.0%

People’s voices

The proliferation of new media, Internet based
networks and the web 2.0 phenomenon, started
a revolution in journalism and in terms of how
people consume news and other types of content.
This requires a serious assessment on how to
face the challenges of the digital era, adapting
the Company’s business models to satisfy
Grupo Clarín’s audiences, and at the same time
sustaining the Company’s leadership position.

Grupo Clarín’s media companies have a long
history of audiences’ and readers’ engagement.
The ability to anticipate trends together with a
profound knowledge of media consumers and
the ability to interpret their needs and meet
their demands, explain the Company’s sustained

leadership and favored place amongst consumers’
preferences.

The pace of change calls for new and creative
means of
interaction. Clarín’s newspaper
segments such as “El juicio final”, “Cartas al
país” and daily readers’ surveys, all traditional
means of engaging readers, are complemented
by more recent initiatives to accompany peoples’
needs to participate in the news process. Over
the last few years, the Company has launched
a growing number of new blogs, and generated
greater interaction not only with journalists,
but also between our users. Interactivity opens
informative content deriving from
space for
readers, listeners and web users. ‘TN y la gente’

is a web-based tool developed by the Company’s
news channel, where audiences send photos or
video footage captured from personal and mobile
cameras, as another way of introducing citizen
journalism and increasing end-user participation
in our media.

The Company also pays special attention to giving
voice to small or underserved communities and
providing for the development of local content.
Cablevisión and Artear are working together to
gradually renew local TV channels and newscasts
in several cities in Argentina. The program takes
into consideration access to local information and
culture, while providing them with state-of-the–
art technology and training.

44 45

Social and sustainability coverage

To better assess the influence the media can have
on different audiences, Grupo Clarín establishes
goals to ensure the quality and pluralism of its
content. Grupo Clarín’s newspapers and television
newscasts have a long and highly praised record in
investigative reporting, and provide comprehensive
news coverage and insightful pieces on relevant
social and environmental issues. Reflecting the
diversity of society through its news coverage and
entertainment content lies in the core of its unique
capacity to engage with audiences and readers.

Special supplements, expert and academic voices
and editorials, onsite coverage and skilled
infographics complete an
journalists and
extensive offering on topics that vary from
health, consumption and development to science,
education and conservation. Weekly TV Programs
such as ‘TN Ecología’ and ‘TN Ciencia’, in Todo
Noticias, Grupo Clarín’s 24 hour news channel
and the leading cable channel in Argentina, have
become leaders in their fields.

During 2011, the Company´s media paid special
attention to issues related to climate change and
the environment.

Radio Mitre, its main broadcasting radio station,
combined 24 hour coverage of these issues
through an environment specialized journalist and
a campaign to promote people’s involvement.

The newspaper La Razón launched the monthly
supplement Gestión Sustentable (Sustainable
Management) to promote awareness about
the most prominent issues of the sustainable
development global agenda and to report on
social and environmental responsibility actions
carried out by companies and organizations of the
civil society.

Among the most significant initiatives, the
Company started to work in association with
Vida Silvestre, Farn, Greenpeace and other 7
environmental organizations from Argentina or
with active presence in the country to develop a
collectible named Salvemos Nuestra Tierra (Let’s
save our planet) published together with Diario
Clarín in March 2012. The product seeks to raise
awareness on major environmental issues and
their potential solutions, while offering a guide to
learn how to help the planet and activities to work
at school or at home.

The Company also continued to draw attention
to weblogs that create social awareness within
Clarín.com. Some examples are “¿Estás?” in
association with Red Solidaria, “Espacio Positivo”,
with Fundación Huésped and “El Otro, el Mismo”,
with universidad Católica Argentina and social
organizations engaged in fostering the inclusion of
people with disabilities. Moreover, the “Calendario
del Compromiso con la Comunidad” (Calendar of

Commitment to the Community) was published in
Revista Viva for the sixth consecutive year.

is deeply rooted

Education
in the Noble
Foundation’s mission and history of community
involvement since its origin, and is also one of the
key social issues frequently addressed by Grupo
Clarín’s editorial coverage. During the last few
years, third party, academic and the company’s
own monitoring processes have all registered a
gradual, yet sustained increase in social topics
coverage.

During 2011, NGO Periodismo Social and Austral
university produced an independent report on
television news coverage regarding childhood
in Argentina. Telenoche, the Company’s main
newscast and leader in terms of audience, was
identified as the one that allocated more space
to news and information regarding children and
youth, reaching 32,4% of their total coverage.
Also, the report concluded that more than 54%
of the sources referred were children and their
families.

This relates to an initiative that the Company
launched in 2009 by which is breaking new ground
in Argentina: an ambitious training program
oriented to audiovisual journalists, that seeks
to achieve excellence and raise awareness of
the particular features of the main social topics

in order to promote responsible coverage in the
news. In its initial stages, the project involved
training for journalists who work on newscasts
related to Cablevisión and Artear, mainly in the
interior of the country and reaching most coverage
areas.

Recognizing the importance of reflecting diversity,
promoting social
justice, protecting youth,
encouraging minority recognition and preventing
racial and gender discrimination, the company is
already moving ahead in its goal for the next period
to continue to offer training for its journalists.
During the first semester of 2012, several
workshops are being held directed at journalists,
editors, anchors, cameramen and other television
professionals from the Company’s main air and
cable TV channels to improve coverage and create
awareness on these issues.

Promoting involvement

Still, there is much to be done. In this regard,
Grupo Clarín aims to continuously enhance its role
in promoting public debate, encouraging individual
involvement by better and further portraying the
challenges of society under social, economic and
environmental aspects with a plural view.

Grupo Clarín’s different media companies also

endorse several initiatives promoting people’s
involvement
in democracy and responsible
citizen control of their representatives’ acts and
decisions.

Through Artear, the Company set out once more to
promote values such as solidarity and community
involvement. Thus, it created “Abanderados de la
Argentina Solidaria”, an award that recognizes
the otherwise silent labor of social entrepreneurs
and community leaders, by divulging valuable
and replicable initiatives that advance social
transformation. The initiative is supported by
Ashoka and a remarkable panel comprised by
outstanding people from the social, academic and
cultural sectors. In its second edition in 2011, the
award was granted to Leila Abdala, president of
Minka foundation, an organization dedicated to
the inclusion of people with disabilities in the
province of Tucumán. Also, during the year, special
news reports and tributes were aired regarding
late Sigfrido Moroder, a catholic priest that
transformed the lives of the aboriginal community
of Quebrada del Toro, in the province of Salta, and
that had won the first award.

In 2011, Clarín supported the first edition of Expo
Solidaria, an event that under the motto “helping
the helpers” convened more than 170 NGOs from
different regions of the country, and showed
the public the daily efforts made by thousands

of persons committed to helping children and
teenagers.

In May, Genios magazine launched “Te Abrigo”,
its first institutional campaign aimed at restoring
the value of collective construction. The magazine
invited families and homes from the country to knit
square woolen pieces that were then assembled
by Red Solidaria volunteers and distributed among
the homeless. The families donated more than
60,000 woolen squares that were used to make
1,400 blankets.

During 2011, Clarín renewed its partnership with
Missing Children and Red Solidaria to publish
photographs of missing children in La Razón
newspaper and raise awareness about the role of
the community in dealing with this problem. The
Company also helped to broadcast the events held
to remember and create awareness in relation to
the anniversary of the terrorist bombing of the
AMIA.

Grupo Clarín also provided renewed support to
the traditional campaign “Un sol para los chicos”,
together with Artear and UNICEF. The campaign
reached in 2011 its 20th edition, and promotes
private social investment –still lower in Argentina
and Latin America compared to the US and
Europe- and is one of the key sources of income
for UNICEF in the country.

46 47

GRUPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY / Community engagement and social advertising

Community engagement
and social advertising

Grupo Clarín’s
impact and relation with
communities and individuals exceed those of
its editorial coverage. Support for vulnerable
communities, mentoring education projects,
campaigning for disaster affected regions and
different types of donations and expertise are only
some examples of the many initiatives organized
and fostered jointly or separately by Grupo Clarín’s
different media companies.

In terms of social advertising, during 2011,
through the Noble Foundation and several of its
media companies, Grupo Clarín contributed with
advertising time and space to promote social,
civic and environment related causes, through its
own programs or within strategic alliances with
renowned NGOs. During 2011, the amount of air
time in broadcast television and radio donated
reached 278 thousand seconds, which represents
a figure of more than Ps.15 million.

The impact made by these and other specific
contributions to projects and campaigns by
other subsidiaries can be added to the 2.2
million pesos budget of the Noble Foundation
for the 10/11 period, and the 3,2 million pesos
represented by the donations of connectivity
services. Nevertheless, the total figure cannot be
yet estimated at a group level since information
collection systems are being set in place to be
able to provide detail.

As well as contributing with its own funding,
knowhow and expertise, Grupo Clarín aims to
leverage support from others by seeking matching
funding and regular donations from individuals
and partner organizations for supported initiatives.

In response to civil society organizations growing
communication needs and demands, Grupo Clarín
launched a multiple approach program that
combines spreading and raising active awareness
of public and social interest topics through
advertising, design and communication services
for NGOs and the development of web based
blogs and sites.

During 2011, the Company strived to further
contribute to the improvement of social advertising
in civil society
and communication skills
organizations. One of the ways to engage this
issue involved increasing the scale and impact of
“Segundos para Todos”, an advertising contest for
NGOs organized by Cablevisión, which combined
broadcasting spots with coaching sessions in
Buenos Aires, Córdoba, Santa Fe, Salta and
Neuquén. During 2011, the company continued
to invest in the TV program “Segundos para todos
TV”, that reflected their outreach to the community
and focused on public interest topics.

An additional issue in which Grupo Clarín has a
sustained and strategic commitment is in reducing
the digital divide and promoting digital inclusion.
This is addressed by raising awareness through
news coverage and TV programs in different
media outlets. Also during 2011, Cablevisión
extended its free cable TV and Internet access
connections program to a growing number of
schools, hospitals and other institutions, reaching
almost 19 thousand connections by the end of
the year. This represents an annual contribution
of approximately Ps.3.2 million, and is completed
with specific programs such as a “social fee” for
low income neighborhoods.

GRUPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY / Fostering education and culture

Fostering education
and culture

As part of the Company’s initiatives to support
education, Grupo Clarín used its cross-segment
position and ability to communicate with society
to raise awareness of education’s importance as a
right and as a critical driver of social development
in Argentina’s future. In this sense, the Company
tried to foster equal opportunities in education
through the generation of updated, affordable
and quality educational materials for students,
teachers and schools throughout the country,
through its publishing company Tinta Fresca.

Also,
the company created Voz Activa, a
publishing house that recently launched the first
Dictionary ever published that is entirely focused
in the Spanish language spoken in Argentina. This
historic contribution to culture and education was
widely acknowledged by academics and society in
general.

For the eleventh consecutive year, the Company
successfully organized the campaign entitled
“Digamos Presente”, an initiative focused on
education involvement and rural education,
together with APAER, Red Solidaria, Cimientos
Foundation and in alliance with Telecom.

Among the main alliances are specific initiatives
such as
the public-private project entitled
“Escuelas del Bicentenario” (Bicentennial Schools).
This project seeks to assist public elementary
schools to which children in vulnerable social
circumstances attend throughout the country,
and to contribute to public policy, by developing
scalable, sustainable and
replicable school
improvement mechanisms. Another alliance is
the program “Potenciar Comunidades Rurales”
(Empowering Rural Communities) carried out to
support several local development projects in
certain provincial communities.

One of the most important initiatives generated
from a collective effort is the “Premio Clarín-
Zurich a la Educación” (Education Awards). The
third edition recognized the best projects aimed at
improving the quality of natural sciences teaching.
For the next period it will select the best project in
the field of mathematics.

During this period, through the Noble Foundation,
the Company continued to offer donations of
bibliographical material, and renewed its long
time support of several schools which carry the
name of the Clarín’s founder, Roberto Noble
(‘Escuelas Roberto Noble’).

Again this year, the Company sponsored the
annual Maratón de Lectura (Reading Marathon)
initiative, organized by Fundación Leer with the
participation of 3,500,000 children. The event
received the donation of books published by Clarín
and the initiative was promoted through a wide
range advertising campaign.

Likewise, the cultural commitment was renewed
through several sponsorships, reaffirming Grupo
Clarín and its subsidiaries’ presence in important
events, such as the National Book Fair, Expo
Trastiendas, Arte Clásica, Fundación PROA, Arte BA,
Teatro Colón, Festival de Otoño, Usuahia’s Festival

of classical music, the World Tango Festival,
the Mozart Fest and Festivalito, among others.
Grupo Clarín also supported the presentations
of Iñaki Urlezaga and Trío Argentino, the theater
performance of “Arturo Illia”, a play starred by
Luis Brandoni, as well as the launch of Teatro
Maipo’s season presenting “El último tour” by
Eleonora Cassano and the play “The War of the
Roses” and motion pictures such as “El gato
desaparece”, “Viudas” and “Vaquero”.

The Company also supported the annual award
“Premio Clarín de Novela” and “Premio Clarín de
Cuentos” and the first edition of the literature
program “Primavera Independiente” at Victoria
Ocampo’s residence in San Isidro.

Through its cable and broadcasting channels, the
Company also makes significant efforts to promote
the most important cultural, cinema and sports
events, and makes an increasing contribution in
the field of cultural diversity and local identity.
Noteworthy are initiatives such as “Volver”, a
cable channel that preserves the most complete
Argentine programming archive, or the “Word
Archive” at Radio Mitre, which offers an online
record of some of the country’s most valuable
audio heritage.

Noble Foundations’ educational donations

Books

Magazines

Booklets

2011

53,406

6,625

260

2010

63,542

4,160

550

2009

40,589

7,066

837

YoY

(15.95%)

59.25%

(52.73%)

48 49

GRUPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY / Media literacy and protection of young audiences

“Education and the media” Program

Teachers’ workshops

Students’ workshops

2011

100

525

2010

169

581

2009

111

553

YoY

(40.83%)

(9.64%)

Media literacy and protection
of young audiences

Media has an increasing role in society and
especially in the lives of young people. Through
several programs, the Company encourages them
to develop tools to access media through critical
analysis and to take advantage of opportunities
presented by media to explore their identities,
creatively express their thoughts and opinions,
and amplify their voices.

Media Literacy is generally defined as the
ability to access, analyze, critically respond and
benefit from the different type of media. Grupo
Clarín´s main tool for fostering media literacy is
“Los medios de comunicación y la educación”
(‘Education and Media’), a leading and recognized
program that has been in place for nearly 30 years.
One of the main activities of the Noble Foundation
in 2011 was that of renewing the program, which
consists of workshops and booklets for teachers
and students to promote a critical approach to
the media and to utilize them as complementary
resources in education.

through
These programs are supplemented
other
initiatives regarding the promotion of
responsible content consumption. Through the
Noble Foundation, Grupo Clarín renewed the
presence and coordination of the media section
at the “Museo de los Niños” (Children’s Museum),
and continued to promote visits to its printing
facilities. During 2011, 13,452 people (mainly
students) had the opportunity to see firsthand
what goes on behind the news production and
distribution process.

Within its Cable TV and Internet access segment,
the Company contributes with the protection of
young vulnerable audiences, providing tools for
parents to keep children from accessing sensitive
or age inappropriate programming. This includes
several parental control options in Cable TV
service and equipment, in addition to guidance
tips, awareness campaigns and tools for web
access restrictions.

On the other side of the screen, children artistic
participation in television and films also requires
a responsible approach. The Company complies
with all regulations and self-imposed guidelines
by setting limited time schedules and engaging
with parents and tutors.

Excellence in journalism

Reaffirming its commitment to journalistic
excellence, the Noble Foundation also carried
out activities to consolidate the training and
excellence of current and future communicators.

Among them is the support provided to the Masters
Degree in Journalism, an international graduate
course with the highest academic level, organized
by Grupo Clarín and the University of San Andrés,
with the participation of the School of Journalism
at Columbia University and the University of
Bologna, and led by renowned national and
international journalists and academics.

In this sense, the Company sponsored the
achievements (both at the institutional level and
through journalistic content) of the Graduate
Course in Scientific, Medical and Environmental
Communication. This program is organized by the
University Pompeu Fabra in Barcelona, together
with the Leloir Institute and the cable station Todo
Noticias (TN).

Another highlight in this area was the launch
during 2011 of the Graduate Program in Digital
Journalism organized by the University Pompeu
Fabra and TN.com.ar.

OUR PEOPLE

Grupo Clarín’s success and leadership is mostly
the result of the efforts, talent, professionalism
and creativity of its people.

It is no coincidence that Grupo Clarín’s media
companies are amongst the most preferred
working places by communication professionals.
The Company strives to offer better opportunities,
incentives and tools to sustain and strengthen the
firm commitment of the professionals that believe
in Grupo Clarín’s project.

our people

18,000

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

YoY

1
7
,
2
0
0

1
6

2
7
7

2009

2
0
1
0

5.67%

50 51

Distribution of company employees by category

2011

248

2,403

2,513

Management

Middle management

Junior management,

administration

and commercial

Qualified technical

6,988

personnel

Journalists

others

1,357

3, 691

2010

280

2,132

3,706

6,782

N/A*

3,377

2009

246

2,075

3,538

6,174

N/A*

3,489

YoY

(11.43%)

12.71%

(32.19%)*

3.04%

N/A*

The Company possesses a special make-up in
terms of age and gender diversity among its
employees. When it comes to gender, the higher
proportion of male employees is significantly
explained by the large number of technical
personnel, which in Argentina is predominantly
male, working in the printing facilities and in the
Cable TV and Internet access segment. The gender
composition in other companies of the Group is

balanced, especially regarding content related
activities, such as journalism and audiovisual
production, where the workforce is diverse.

In 2011, employee turnover remained at 8%. This
figure shows the number of employees that left
the Company or its subsidiaries voluntarily or due
to dismissal, retirement or death.

Employees by sex 2011

13,375

3,825

Men

Women

2010

12,698

3,579

2009

11,554

3,968

YoY

5.33%

6.87%

Employees by groups of age 2011

<30
5,442

31-50
9,920

>51
2,038

<30

31-50

>51

2010

4,875

9,464

1,938

2009

4,350

9,558

1,614

YoY

11.63%

4.93%

5.16%

Turnover by Sex and Age 2011
(As a percentage of total employees)

5.32%

2.63%

<30
3.47%

31-50
3.64%

>51
0.84%

Men

Women

<30

31-50

>51

2010

5.42%

2.64%

2010

3.68%

3.50%

0.88%

2009

5.33%

2.44%

2009

3.43%

3.18%

1.16%

YoY

(0.10%)

(0.01%)

YoY

(0.21%)

0.14%

(0.04%)

*Note: 2011 figures reflect a new employee category breakdown, identifying journalists as a specific part of the total workforce.

Therefore, comparative analysis with previous years -that included a different breakdown- cannot be shown.

In addition to strictly abiding by the laws, the
Company sets higher than standard conditions for
its employees. Of Grupo Clarín’s total workforce,
more than 76% of employees are covered by
collective agreements. For those who are not,
the Company’s policy is to apply the conditions
established by the best existing agreement.

Taking care of the work environment and
conditions, health and job safety and offering
training to improve employees’ professional skills
and techniques are some of the actions aimed
at consolidating the sense of integration and
achievement of organizational goals. One of the
key ways of obtaining feedback on the Company’s
performance is via the global staff survey, carried
out every two years.

In 2011, the Company created and launched the
in-house Volunteer Program of Grupo Clarín and its
subsidiaries. Named “Vos también” (You Too), the
program included the design and implementation
of several actions to engage volunteers with the
community. The program was implemented in
9 business units, including the corporate area,
with impact on 12 provinces. According to its
main indicators, volunteers dedicated 5,373 hours
of work (3,354 during working hours), with a
global engagement rate of 13.35%, representing
1,466 volunteers. Work was done in association
with social organizations; 35 entities that have
partnered the several initiatives that helped 1,656
people.

Through these initiatives, volunteers had an
opportunity to help in a variety of areas, including
building emergency homes, organizing employability
workshops, collecting toys and food and organizing
blood donation efforts, among others. The program
had a high satisfaction level among participants:

97% of them stated that they would participate
again.

Grupo Clarín has paid special attention to the
multiple internal communication tools, such as the
magazine Nuestro Medio, the Corporate Intranet
with participation spaces and forums, the digital
newsletter Nuestro Resumen, and the digital
newsletters of the Corporate Training Program and
the Company Climate Management Program, as
well as internal communication spaces and notice
boards. Year after year, Grupo Clarín increases
its efforts to implement and streamline the
information channels on benefit programs, policies
and relevant organizational changes, and news
concerning the daily development of activities.

Benefits and career development

Although most benefits are common to the
whole Company, each business unit integrates
additional benefits that vary in nature according
to tasks. Since the last quarter of 2007, the
Company, together with its subsidiaries, began to
implement a Long Term Savings Plan for directors
and managers, which became effective in 2008.

During 2011, corporate and business units’
human resources departments have continued to
implement different programs to identify internal
talent for career development. Also, Grupo
Clarín’s and Cablevision’s Young Professionals
Program was renewed, creating opportunities for
professionals that are taking their first steps in
their career paths.

In order to develop new skills and build up
existing strengths, people need encouragement
and support. In addition to increasing the number

and variety of training options, during 2011, the
Company continued efforts to extend and enhance
the employee performance appraisal program in
different categories.

Grupo Clarín’s employees and professionals can
update and expand their knowledge and skills
through several training programs, ranging from
seminars and courses to graduate degrees and
MBAs. Human Resources departments are in
the process of consolidating individual training
records and training hour’s information

One of the main initiatives in this respect is the
‘Corporate Training Program’ which includes a
wide variety of courses. A relevant aspect among
current training options is that the Company pays
special attention to training on new tools and
technology developments, in order to properly
prepare its workforce for the challenges the media
sector is facing.

In addition, throughout the business units, there
have been seminars and programs on quitting
smoking, diseases, and other relevant topics,
as well as special action campaigns regarding
health and medical check-ups, with special focus
on the preemptive measures against seasonal
deceases. Also, the Group carries our several
different activities designed to prevent job related
accidents.

Grupo Clarín continued to explore alternatives of
interaction or joint approach to common interest
issues at the various levels of its value chain.
Grupo Clarín focused on the implementation of
systems and procedures aimed at the application
of best practices for purchases, hiring, and
contracting with suppliers, within a framework of
supervision and transparency.

52 53

ENVIRONMENT

It is widely recognized that the media industry
has a lower impact than most other industrial
processes. Within the framework of an
environmental management policy aimed at
improving eco-efficiency, the Company and
its subsidiaries primarily consume energy, wood,
newsprint, cable and water and generate waste.

During 2011, the Company continued to take
steps towards the measurement, planning and
improvement of manufacturing processes to
optimize results and address possible impacts.
Progress was made in achieving the period’s goals
by introducing sustainable methods to obtain
and use resources; implementing policies for
investment in equipment and raising awareness
for the adequate use of technology.

The United Nations Global Compact, signed
by Grupo Clarín in 2004, also sets principles
regarding environmental protection. Businesses
are asked to:

(principle 7)

support a precautionary approach to environmental

challenges;

(principle 8)

undertake initiatives to promote greater environmental

responsibility;

(principle 9)

and encourages the development and diffusion of

environmentally friendly technologies.

The present report reflects the global impact of
the different subsidiaries where the Group has
controlling or minority stakes, while indicating
some specific effects with regards to the nature of
the different business activities.

GRUPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY / Environment

Consumption. Wood,
Newsprint and Energy

A company that publishes newspapers and
magazines with an integrated structure achieves
a comprehensive view of product’s life cycles.
Through its subsidiaries and related companies,
Grupo Clarín participates in the production of
newsprint, which is then used as a raw material
by some of its subsidiaries. Printed products
can subsequently be recovered and reused via
recycling processes to generate more newsprint.

The principal raw materials for the production of
newsprint are fresh fiber from round wood and
recovered paper.

In 2011, Papel Prensa, the paper mill in which
Grupo Clarín owns a minority stake, consumed
340.076 tons of fresh fiber and 13.725 tons of
recovered paper. The figure for recovered paper
was significantly increased in over 55% in relation
to the amount reported in 2010. The type of fiber
source (Poplar, and Willow) depends upon the
availability of materials, as well as economic
considerations such as the minimization of
transport distances and costs, which is a relevant
economic and environmental consideration.

Nevertheless, it is important to mention that fresh
fiber comes entirely from sustainable plantations.
This means that no native forests are involved
or endangered. This is combined with continuing
research on Salicaceae, related to their genetic
improvement and also to ecologic and silvicultural
aspects, done by means of agreements made
with universities, research centers and experts,
with the objective of increasing productivity,
reducing costs and assuring the sustainability of
the ecosystem.

The forestry division undertakes its activities
with a sustainability strategy that involves the
protection of biodiversity. Protected forestry areas

paper

Ink

Aluminum plates

2011

2010

2009

112,290 Tn

111,656 Tn

112,400 Tn

2,735 Tn

236 Tn

2,412 Tn

272 Tn

2,335 Tn

233 Tn

YoY

0.57%

13.39%

(13.24%)

and the banning of hunting activities have led to a
sustained increase in bird fauna. These conditions
allows for the development of several R&D
programs, also in collaboration with universities,
which include the introduction, protection and
reproduction of certain endangered deer species
for their proper and secure development.

based coldest is environmentally friendlier than
other types of ink and allows reducing ink usage
by approximately 10% or 15%. This can also be
achieved by printing techniques; at the Company’s
printing sites the stochastic printing style
introduced in 2008 continues to be applied as a
way of optimizing ink usage.

Most of the other Company activities are
undertaken in urban areas with no relation to
natural areas, and complying with urban planning
standards in force.

At the printing plants, paper and ink constitute the
main material consumed. Most of the newsprint
supply comes from Papel Prensa. The Company
also follows established guidelines to ensure
the provision of other materials, such as inks and
other specific inputs, at quality levels compatible
with international standards. In terms of types
of inks used, although different printed products
require different resources, as an example, the
main printing plant usage of vegetable oil based
coldset ink reaches almost 60%. Vegetable oil

54 55

GRUPO CLARÍN AND ITS CORPORATE SOCIAL RESPONSIBILITY / Environment

Direct and Indirect energy consumption by primary source:

electricity

Natural Gas

Gasoline

Fuel oil

Gasoil

lp Gas

2011

2010

2009

431,326 MWh

419.563 MWh

442,670 MWh

25,825,636 m3

29.898426 m3

33,688,892 m3

29,399 GJ

159,091 GJ

64,509 GJ

2,449 GJ

24.676 GJ

172.219 GJ

76.043 GJ

2563 GJ

20,550 GJ

84,593 GJ

72,387 GJ

2,887 GJ

YoY

2.80%

(13.62%)

19,14%

(7,62%)

(15.17%)

(4.45%)

Company qualified teams continuously strive to
reduce consumption by identifying and adopting
increasingly eco-efficient processes. During this
period, the paper consumption increased partially
due to higher circulation figures related to new
products. The introduction of adjustments on the
dimensions of newspapers made in previous years
continues to shows its benefits in the use of paper
and other materials.

The percentage of polybagging in the Company’s
newspapers and magazines continues to be
of minor significance, although the use of
polypropylene in some parts of the dispatching
process is regularly assessed.

The primary resource used by Grupo Clarín and its
subsidiaries is energy. Grupo Clarín’s consumption
comes from both direct and indirect sources; the
indirect consumption comes from electricity taken
from the grid.

Energy consumption is significant in the paper
related and printing activities and, to a lesser
extent, in the business units which operate
with technology, such as cable television and
Internet services, broadcasting, etc. In this area,
some initiatives developed by Artear include
the introduction of cold lighting in all new and
renovated television studios, in order to obtain 5
times less than the regular consumption. During
this period, the company continued to invest in
equipment -manufactured within environmentally
friendly parameters- in order to meet the needs of
the generation and distribution of content in High
Definition. Also, in addition to reaching the goal
of replacing 100% of Artear’s live unit vehicles
for low consumption vehicles, thus considerable
reducing emissions, this business unit focused on
a multiple stage scheme to replace other lighting
materials.

purchased a bark boiler allowing the Company to
set a goal of making additional savings in GHG
emissions, while better managing waste.

parties for recycling and reuse. Aluminum plates
used in printing can be 100% reused.

Emissions and discharges

In terms of emissions, the main contributors to the
Company’s carbon footprint are print sites and the
paper mill. Nevertheless, Grupo Clarín’s indicators
include other emissions such as those arising from
transport and the daily use of its facilities. The
Company is constantly exploring alternatives to
improve processes and efficiency in these areas,
and to continue to enhance the analysis and
inventory of Co2 emissions generated by Grupo
Clarín’s activities.

Indirect emissions arising from electricity usage
can only be calculated based on Argentina’s
energy matrix.

The primary strategies available to reduce greenhouse
gas emissions are reducing the consumption or
changing the energy sources. Increased use
of renewable forms of fuel and bioenergy is a
positive strategy. During 2009, Papel Prensa

Each Grupo Clarín subsidiary and related company
identifies and manages waste production and
disposal. In 2011, this management included the
recycling of 13,725 tons of recuperated paper and
cardboard, 14.9 tons of ink and the reuse of nearly
235 thousand cable modem units.

Contrary to the production of white paper, the
newsprint manufacturing process does not involve
the use of chlorine for bleaching. This results in a
significantly lower chemical impact.

As part of the treatment of industrial waste from
the printing process, the Company collects and
separates other waste materials (ink, oils, greases
and solvents), which are shipped to certified third

Co2 direct emissions

70,090 Tn

79,954 Tn

79,866 Tn

2011

2010

2009

urban or

70,090 Tn

79,954 Tn

79,866 Tn

2011

2010

2009

non-hazardous waste

YoY

(12.34%)

YoY

(12.34%)

Hazardous waste

492.3 Tn

622 Tn

619 Tn

(20.85%)

Hazardous waste is carefully handled and handed
over to authorized waste management companies.
During 2011 the Company reduced the amount of
this type of waste by nearly 21%.

Special care is also maintained regarding the
handling of liquid effluents resulting from
development processes, subjecting them to
rigorous treatments and measurements before
disposal. The main water usage, recycling and
discharges are related to the paper mill. Since the
beginning of its operations in 1978, Papel Prensa’s
investments have allowed it to reduce its water
usage in more than 40%. Strict procedures are
set in place to permanently asses and manage the
quality of discharges. Routine testing validates
compliance with nationwide regulation in terms
of toxicity of the discharges.

In addition, Grupo Clarín continued to increase
the contribution to the Garrahan Foundation
through an office paper recycling program. This
was combined with programs for reducing the
use of paper in Company offices while seeking
to optimize printing techniques, and renewed
efforts to raise employee awareness regarding
sustainability issues.

56 57

RISKS
FACTORS

As an Argentine multimedia company, Grupo Clarín
is exposed to a wide range of risks, related to the
country and also to its operations. Nevertheless,
one of the Company’s strengths lies in its strategic
diversification to help spread possible risks.

The Company relies on strong internal control and risk
management systems. The identification of risk and
its assessment is part of each unit’s business plans,
and is also addressed by a corporate based control
department and by the Board on a regular basis.

Argentina’s economic environment

Substantially all of our operations are conducted
in Argentina, and are therefore affected by
changes in Argentina’s economic environment.
After six years of sustained economic growth, the
Argentine economy slowed down in the second
half of 2008 and throughout 2009, affected by the
international crisis as well as internal political
developments. Although the trend was later
again reversed, Argentina’s growth may not be
sustainable in the future. Sustainable economic
growth depends on a variety of factors, including
international demand for Argentine commodities,
stability and competitiveness of the Peso against
foreign currencies, confidence of consumers and
local and foreign investors and a low rate of
inflation. A downturn in economic activity is likely
to result in increased subscriber churn as well as
decreased advertising revenues.

We seek to address the cycles affecting the
Argentine economy by diversifying the scope of
our business and managing our foreign currency
liabilities.

Political and Economic Uncertainties

Our financial condition and results of operations
depend to a significant extent on macroeconomic
and political conditions prevailing in Argentina.
The Argentine government’s actions impacting
the economy, including those in connection with
inflation, interest rates, price control, exchange
control and taxes, have affected and could

continue to affect Argentine companies like ours.

Inflation, which stood at 9.5% for 2011 (INDEC
information, although private estimates of inflation
rates largely exceed those published by the
INDEC) may continue to rise. A recent rise in public
expenditure could further accelerate inflation, as
could an adjustment of public service and utility
rates. This may affect adversely the Argentine
long-term credit markets as well as the Argentine
economy generally. A contraction of the economy
would also adversely affect our financial condition
and results of operations.

The country’s economy may be adversely and
lengthily affected by economic developments in
other markets. Furthermore, to date Argentina’s
ability to obtain financing from international
markets remains limited.

Certain of our costs, including a significant portion
of our financial expenses, are dollar denominated.
Currency fluctuations, such as a considerable
devaluation of the Peso against the U.S. dollar are
likely to affect adversely the Argentine economy and
will impact negatively on our financial condition.

Legislation and Regulation

In October 2009, the Argentine Congress passed
a new Audiovisual Communication Services Law
that is intended to replace the general legal
framework under which the audiovisual media
industry operated in Argentina for practically three
decades. The new Audiovisual Communication
Services Law has been challenged by us and other
parties in interest on several grounds, including
its encroachment upon constitutional rights,
the broad and discretionary powers over media
and content granted to the Executive Branch, for
favoring state-owned and sponsored media and
affecting the sustainability of privately-owned
media, promoting the elimination of independent
signals and enabling a pervasive and questionable
censorship system anchored upon the discretional
power to grant licenses and the application of
penalties, among other controversial aspects.
Since its enactment in October, 2009, several court

rulings have been issued enjoining the application
of the statute in its entirety in certain cases, or of
certain of its provisions, in other cases. Some of
these rulings have been reversed by the Supreme
Court of Argentina and a court of appeals, but
injunctions that suspend specific sections of the
law are still in effect.

If ultimately upheld by the judiciary, the application
of the new legal and regulatory environment to
our cable television, telecommunications and
Internet and digital content operations may be
disadvantageous to us, and will affect the manner
in which we operate our business. Failure or delay
in renewing our licenses or obtaining regulatory
approvals may also influence the availability of
our services to our customers.

In addition, since 2009 the Argentine government
took measures intended to rescind the authorization
granted unanimously by the National Antitrust
Commission in 2007 to the purchase by the
Company and Fintech of shares representing
Cablevision’s capital stock, and Cablevision’s
purchase of interests in certain of our subsidiaries.
The Argentine government has also taken
measures to revoke the license under which
Cablevision’s renders internet services, and to set
the price of its pay-television service according to
a pricing formula, among others. Such measures,
which we have challenged judicially, if upheld
would materially adversely affect our business.
We have obtained preliminary injunctions that
have enjoined the government action, and will
continue to make every effort to defend ourselves
by taking all actions necessary to safeguard our
rights. However, we cannot assure that such
efforts ultimately will prove successful.

In Argentina, the legal system, including the
Constitution, shields journalistic activities from
regulation with the purpose of protecting the
independence of the free press. As a media
company, we are vigilant as to the menaces that
might arise in this respect and widely cooperate
with journalistic associations and other NGOs
that advocate for the protection of fundamental
constitutional rights such as freedom of speech
and freedom of the press.

BUSINESS PROJECTIONS
AND PLANNING

In the forthcoming years and as part of Argentina’s
challenge to achieve growth, Grupo Clarín seeks
to maintain and consolidate its presence in the
local market, both in the production and in the
distribution of content.

Grupo Clarín’s business units, along with the
development of its core activities, will continue
to work in order to seize opportunities, seeking
to reinforce, improve and expand the range of
products and services offered; increase market
share; reach new audiences and promote permanent
innovations.

Grupo Clarín will continue to focus on further
optimizing the productivity and efficiency levels in
all of its areas and companies, seeking to develop
and apply the best practices related to each of
these processes.

At a corporate level, it will continue to focus on the
main processes that allow sustainable, healthy
and efficient growth from different perspectives:
financial structure, management control, business
strategy, human resources, innovation and
corporate social responsibility. Grupo Clarín will
continue to analyze alternative new ventures
related to its mission and strategic objectives both
in Argentina and abroad, as long as they add value

to shareholders and are feasible and viable under
the prevailing economic environment.

Grupo Clarín will continue to strengthen its
consolidated commitment to traditional media,
with a growing focus on the area of digital media
and connectivity. To such end, the Company
will leverage its strong presence in distribution
networks, brand strength and, fundamentally, its
broad experience in the production of content,
recognized by the Spanish-speaking market for its
quality, credibility and prestige.

In the hostile environment created by the current
government towards the media, Grupo Clarín
ratifies its determination to bring the necessary
legal and administrative actions to safeguard
its rights and those of its shareholders, while
reinforcing once again its commitment towards
its readers, audiences and the country. In its daily
work, Grupo Clarín undertakes to assume with
strength and responsibility the role the media are
called to play through independent journalism and
through the defense and promotion of universal
and fundamental rights, such as freedom of
speech, since these are pillars that extol the
quality of democracy and the welfare of the
Argentine society as a whole.

Sector Development and Competition

The media industry is dynamic and undergoing
significant developments, at a pace that may
differ from our current expectations affecting
our growth. Increased competition through new
technological developments may adversely affect
our business if we are not able to adapt readily
our operations. Also some of our activities cater to
maturing markets.

While our analysis may not always be accurate, the
Company devotes significant resources to analyzing
emerging trends and has vast experience and a
solid track record in reading consumer demands
and successfully developing new products and
services, adapting its business model in time.

Programming and Personnel

We may not be able to renew our rights to
certain programming and our results of operations
may be adversely affected by the loss of key
personnel. In addition, under the new Audiovisual
Communication Services Law we may be forced to
divest or cease to broadcast certain signals.

The production of content is part of our strategy
and we dedicate significant resources to the
identification of market trends and new figures and
matters of public interest, to preserve the position
of leadership we have acquired in the market.

Liquidity and Funding

We have financial debt outstanding, a significant
portion of which is denominated in foreign
currency. Financial markets remain practically
closed for Argentine companies, and we must rely
primarily on our cash flow generation to service
our debt.

We have engaged in an active liability management
policy, and improved our debt to free cashflow
ratio to limit our need to access the market as a
means of repayment of our financial obligations.

58 59

FINANCIAL STATEMENTS AS OF
DECEMBER 31, 2011

Glossary of Selected Terms

64
64
65
66
68
114
116
116

117
118
119
120
122
124
140
142
144
144
145
146

147
152

CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Cash Flows
Notes to the Consolidated Financial Statements
Exhibit E Consolidated - Allowances and Provisions
Exhibit F Consolidated - Cost of Sales
Exhibit H Consolidated - Information required under Section
64, subsection b) of Law No. 19,550

PARENT COMPANY ONLY FINANCIAL STATEMENTS
Balance Sheets
Statements of Income
Statements of Changes in Shareholders’ Equity
Statements of Cash Flows
Notes to the Financial Statements
Exhibit A - Property, plant & equipment, net
Exhibit C - Investments
Exhibit D - Other Investments
Exhibit E - Allowances and Provisions
Exhibit G - Foreign Currency Assets and Liabilities
Exhibit H - Information required under Section 64, subsection
b) of Law No. 19,550

SUPPLEMENTARY FINANCIAL INFORMATION
Additional information to the notes to the financial
statements - Section No. 68 of the Regulations issued by the
Buenos Aires Stock Exchange

154

REPORT OF INDEPENDENT AUDITORS

158

SUPERVISORY COMMITTEE’S REPORT

Glossary of
Selected Terms

Annual Report and
Financial Statements as of
December 31, 2011
and for fiscal year No. 13
Beginning January 1, 2011
Presented on a
comparative basis

AFA Asociación del Fútbol Argentino (Argentine
Football Association)
AFIP Administración Federal de Ingresos Públicos
(Argentine Federal Revenue Service)
AFSCA Autoridad Federal de Servicios de
Comunicación Audiovisual (Audiovisual
Communication Services Law Federal Enforcement
Authority)
AGEA Arte Gráfico Editorial Argentino S.A.
AGR Artes Gráficas Rioplatense S.A.
ANA Administración Nacional de Aduanas
(National Customs Administration)
APE Acuerdo preventivo extrajudicial (pre-
packaged insolvency plan)
ARTEAR Arte Radiotelevisivo Argentino S.A.
Auto Sports Auto Sports S.A.
Bariloche TV Bariloche TV S.A.
BCBA Bolsa de Comercio de Buenos Aires
(Buenos Aires Stock Exchange)
Cablevisión Cablevisión S.A.
Canal Rural Canal Rural Satelital S.A.
CER Coeficiente de Estabilización de Referencia
(Reference Stabilization Coefficient, a consumer
price inflation coefficient)
CIMECO Compañía Inversora en Medios de
Comunicación (CIMECO) S.A.
Clarín Global Clarín Global S.A.
CLC Compañía Latinoamericana de Cable S.A.
CMD Compañía de Medios Digitales S.A. (former
PRIMA Internacional)
CMI Comercializadora de Medios del Interior S.A.
CNDC Comisión Nacional de Defensa de la
Competencia (National Antitrust Commission)
CNV Comisión Nacional de Valores (Argentine
Securities Commission)
CPCECABA Consejo Profesional de Ciencias
Económicas de la Ciudad Autónoma de Buenos
Aires (Professional Council in Economic Sciences
of the City of Buenos Aires)
COMFER Comité Federal de Radiodifusión
(Federal Broadcasting Committee)
CUSPIDE Cúspide Libros S.A.
CVB CV B Holding S.A.
Dinero Mail Dinero Mail LLC
Editorial Atlántida Editorial Atlántida S.A.
FACPCE Federación Argentina de Consejos
Profesionales de Ciencias Económicas (Argentine
Federation of Professional Councils in Economic
Sciences)
FADRA Fundación de Automovilismo Deportivo
de la República Argentina (Argentine Motor
Racing Foundation)
Fintech Fintech Advisory, Inc. together with its
affiliates
GCGC GC Gestión Compartida S.A.
GCSA Investments GCSA Investments, LLC
GC Minor GC Minor S.A.
GC Services Grupo Clarín Services, LLC
GDS Global Depositary Shares

Grupo Carburando Carburando S.A.P.I.C.A.F.I.,
Mundo Show S.A. and Mundo Show TV S.A.
Grupo Clarín, or the Company Grupo Clarín S.A.
Grupo Radio Noticias Grupo Radio Noticias S.R.L.
Holding Teledigital Holding Teledigital Cable S.A.
IASB International Accounting Standards Board
Ideas del Sur Ideas del Sur S.A.
IESA Inversora de Eventos S.A.
IFRS International Financial Reporting Standards
IGJ Inspección General de Justicia (Argentine
Superintendency of Legal Entities)
Impripost Impripost Tecnologías S.A.
VAT Value Added Tax
JPM JP Morgan Chase Bank, N.A.
La Razón Editorial La Razón S.A.
La Capital Cable La Capital Cable S.A.
Antitrust Law Law No. 25,156, as amended
Broadcasting Law Law No. 22,285 and its
regulations
Audiovisual Communication Services Law Law
No. 26,522 and its regulations
LSE London Stock Exchange
Multicanal Multicanal S.A.
NCP ARG Professional accounting standards
effective in Argentina
OSA Oportunidades S.A.
PALP Long-Term Savings Plan
Papel Prensa Papel Prensa S.A.I.C.F. y de M.
Patagonik Patagonik Film Group S.A.
Pol-Ka Pol-Ka Producciones S.A.
PRIMA Primera Red Interactiva de Medios
Argentinos (PRIMA) S.A.
PRIMA Internacional Primera Red Interactiva de
Medios Americanos (PRIMA) Internacional S.A.
(now CMD)
Radio Mitre Radio Mitre S.A.
Raven Raven Media Investments, LLC
SCI or SECI (after 12/7/2011) Secretaría de
Comercio Interior (Secretariat of Domestic Trade)
SECOM Secretaría de Comunicaciones (Argentine
Secretariat of Communications)
SHOSA Southtel Holdings S.A.
SMC Secretaría de Medios de Comunicación
(Media Secretariat)
Supercanal Supercanal Holding S.A.
TATC Tres Arroyos Televisora Color S.A.
Telba Teledifusora Bahiense S.A.
Telecor Telecor S.A.C.I.
Teledigital Teledigital Cable S.A.
TFN Tribunal Fiscal de la Nación (National Tax
Court)
Tinta Fresca Tinta Fresca Ediciones S.A.
TPO Televisora Privada del Oeste S.A.
TRISA Tele Red Imagen S.A.
TSC Televisión Satelital Codificada S.A.
TSMA Teledifusora San Miguel Arcángel S.A.
UNIR Unir S.A.
Vistone Vistone S.A.
VLG VLG Argentina, LLC

Grupo Clarín S.A.

Financial Statements
as of December 31, 2011 and

For fiscal year NO. 13

Beginning January 1, 2011

Presented on a comparative basis.
In Argentine Pesos (Ps.) - Note 2.1 to the parent
company only financial statements

Registered office:
Piedras 1743,
Buenos Aires, Argentina

Main corporate business:
Investing and financing

Date of incorporation:
July 16, 1999

Date of registration with the
Public Registry of Commerce:
- Of the by-laws: August 30, 1999
- Of the latest amendment: October 10, 2007

Registration number with the IGJ:
1,669,733

Expiration of articles of incorporation:
August 29, 2098

Information on Parent company:
Name: GC Dominio S.A.

Registered office:
Piedras 1743, Buenos Aires

Information on subsidiaries in Exhibit C

Capital structure (See Note 11 to the parent company only financial statements)

Type

Class “A” Common shares, Ps.1 par value

Class “B” Common shares, Ps.1 par value

Class “C” Common shares, Ps.1 par value

Total as of December 31, 2011

Total as of December 31, 2010

Number of votes

Capital

Subscribed,

per share

registered and paid-in

75,980,304

186,281,411

25,156,869

287,418,584

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

Consolidated
Balance Sheets

As of December 31, 2011 and
2010 In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements

Assets

Current assets

Cash and banks

Short-term investments - Note 2.a

Trade receivables, net - Note 2.b

Other receivables, net - Note 2.c

Inventories - Note 2.d

Other assets

Total current assets

Non-current assets

Trade receivables, net - Note 2.b

Other receivables, net - Note 2.c

Inventories - Note 2.d

Investment in unconsolidated affiliates - Note 2.e

Other investments

Property, plant and equipment, net - Note 2.f

Intangible assets, net - Note 2.g

Other assets

Subtotal

Goodwill - Note 2.h

Total non-current assets

Total assets

Liabilities

Current liabilities

Accounts payable - Note 2.i

Long-term debt - Note 2.j

Salaries and Social Security payable

Taxes payable

Sellers financing

Other liabilities - Note 2.k

Total current liabilities

Non-current liabilities

Accounts payable - Note 2.i

Long-term debt - Note 2.j

Salaries and Social Security payable

Taxes payable

Sellers financing

Other liabilities - Note 2.k

Provisions - Exhibit E Consolidated
Total non-current liabilities

Total liabilities

Minority interest

Shareholders’ equity

December 31, 2011

December 31, 2010

653,138,802

258,220,644

1,295,795,530

322,006,588

437,851,738

16,647,171

2,983,660,473

122,595,188

149,274,711

16,964,960

267,531,382

1,049,798

3,710,550,032

629,761,902

12,660,842

4,910,388,815

2,791,308,680

7,701,697,495

10,685,357,968

1,240,435,798

445,961,492

516,901,841

300,844,635

9,004,254

106,114,382

363,449,825

277,247,561

1,015,996,822

248,497,309

289,139,219

85,541,681

2,279,872,417

1,404,343

90,789,315

30,047,212

240,326,069

1,117,346

2,827,844,624

719,512,758

13,098,995

3,924,140,662

2,731,985,120

6,656,125,782

8,935,998,199

844,165,448

264,268,493

389,830,493

475,316,163

3,796,354

93,806,786

2,619,262,402

2,071,183,737

16,450,399

2,762,018,386

2,428,190

79,277,220

816,854

243,800,109

188,698,684
3,293,489,842

5,912,752,244

1,037,401,294

3,735,204,430

20,781,453

2,129,893,236

233,346

88,063,896

1,127,017

266,000,933

155,378,087
2,661,477,968

4,732,661,705

918,479,254

3,284,857,240

Total liabilities, minority interest and shareholders’ equity

10,685,357,968

8,935,998,199

The accompanying Notes 1 to 14 and Exhibits E, F and H
are an integral part of these financial statements.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

Consolidated
Statements
of Income

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements

Net sales

Cost of sales (excluding depreciation and amortization) -

Exhibit F Consolidated

Subtotal

Expenses (excluding depreciation and amortization)

- Selling expenses - Exhibit H Consolidated

- Administrative expenses - Exhibit H Consolidated

Expenses subtotal

Depreciation of property, plant and equipment (1)
and other investments

Amortization of intangible assets, goodwill and other assets

Depreciation and amortization subtotal

Financing and holding results

Generated by assets

- Interest

- Other taxes and expenses

- Impairment of inventories and materials

- Goodwill impairment

- Exchange differences

- Holding gains on inventories

- Holding gains on derivatives

- Effect of financial discounts on assets and other

Generated by liabilities

- Interest

- Exchange differences

- Effect of financial discounts on liabilities

- CER restatement

- Financial debt refinancing result Note 5.1

- Holding losses on derivatives

- Other

Equity in earnings from unconsolidated affiliates, net

Other income (expense), net

December 31, 2011

December 31, 2010

9,752,546,964

7,632,019,424

(4,872,490,542)

4,880,056,422

(3,597,104,686)

4,034,914,738

(1,086,286,607)

(1,195,118,551)

(2,281,405,158)

(761,561,527)

(921,514,422)

(1,683,075,949)

(636,941,903)

(149,580,881)

(786,522,784)

23,943,933

(140,409,846)

(6,906,490)

(12,053,573)

33,370,686

20,677,069

2,300,051

(11,163,322)

(291,872,949)

(224,763,004)

(11,291,313)

(2,973,143)

41,021,843

(8,244,000)

(4,485,704)

16,664,596

7,723,938

(488,754,341)

(130,430,142)

(619,184,483)

18,985,855

(99,279,949)

(4,599,561)

10,932,073

31,815,706

7,180,473

(4,388,840)

(221,946,815)

(128,498,387)

(27,579,101)

(1,640,232)

(449,600)

(846,454)

4,070,623

(7,501,030)

1,308,909,067

(493,432,154)

(277,360,033)

Income before income tax, tax on assets and minority interest

1,243,667,252

Income tax and Tax on assets - Note 13

Minority interest

(454,235,423)

(267,152,452)

Net income for the year

(1) Chargeable to:
Cost of sales

Selling expenses

Administrative expenses

The accompanying Notes 1 to 14 and Exhibits E, F and H
are an integral part of these financial statements.

522,279,377

538,116,880

(562,078,605)

(43,197,264)

(31,666,034)

(427,336,168)

(34,763,264)

(26,654,909)

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

Consolidated
Statements
of Cash Flows

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements

Cash provided by operating activities

Net income for the year

Income tax and tax on assets

Accrued interest, net

Adjustments to reconcile net income for the year

to cash provided by operating activities:

- Depreciation of property, plant and equipment and

other investments

- Amortization of intangible assets, goodwill and other assets

- Allowance for doubtful accounts

- Provision for contingencies

- Allowance for impairment of inventories and

obsolescence of materials

- Exchange difference and other financial results

- Goodwill impairment

- Equity in earnings from unconsolidated affiliates, net

- Minority interest

- Holding losses (gains) on derivatives

- Holding gains on inventories

- Disposal of long-term investments

- Results on sale of property, plant and equipment

- Financial debt refinancing result

Changes in assets and liabilities:

- Trade receivables

- Other receivables

- Inventories

- Other assets

- Accounts payable

- Salaries and Social Security payable

- Taxes payable

- Other liabilities

- Provisions

Income tax and tax on assets payments

December 31, 2011

December 31, 2010

522,279,377

538,116,880

454,235,423

267,929,016

493,432,154

202,960,960

636,941,903

149,580,881

42,375,748

51,505,339

6,906,490

200,223,903

12,053,573

(16,664,596)

267,152,452

5,943,949

(20,677,069)

(6,657,315)

(10,194,877)

(41,021,843)

(433,369,755)

(95,740,021)

(116,706,457)

(1,757,033)

351,925,214

128,550,165

(59,692,583)

(37,264,820)

(23,712,463)

(622,533,817)

488,754,341

130,430,142

10,696,072

57,654,729

4,599,561

138,442,066

(4,070,623)

277,360,033

(6,730,873)

(31,815,706)

436,043

(225,577,715)

35,275,063

(46,417,418)

(2,158,852)

184,108,066

77,254,422

(153,739,486)

34,518,420

(23,300,167)

(383,772,880)

Cash provided by operating activities

1,611,610,784

1,796,455,232

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Cash used in investment activities

Acquisition of property, plant and equipment, net

(1,511,208,974)

December 31, 2011

December 31, 2010

Acquisition of intangible assets

Capital contributions and acquisition of subsidiaries

Proceeds from sale of property, plant and equipment

Proceeds from the disposal of long-term investments

Certificates of deposit

Collection of loans

Collection of dividends

Cash used in investment activities

Cash provided by (used in) financing activities

Loans obtained

Repayment of loans and issue expenses

Payment of interest

Collections (payments) of derivatives, net

Payment of sellers financing

Transfer (setup) of Reserve account / Escrow funds

Payment of dividends

Payments to minority shareholders, net

Cash provided by (used in) financing activities

Financing and holding results generated

by cash and cash equivalents

Net Increase in cash flow

Cash and cash equivalents at the beginning of the year

Effect of decrease in cash due to

deconsolidation of companies

(57,140,766)

(20,320,921)

16,091,223

14,470,615

(10,000,000)

1,547,203

(1,566,561,620)

862,002,493

(211,624,357)

(207,303,452)

41,790,297

(748,725)

5,652,799

(120,000,000)

(185,354,774)

184,414,281

41,708,769

271,172,214

629,423,258

(967,902,557)

(27,237,361)

47,682

3,828,681

9,759,412

(981,504,143)

85,140,154

(164,234,302)

(52,259,818)

(6,038,542)

(120,701,718)

(296,920,195)

(71,856,228)

(626,870,649)

24,840,777

212,921,217

459,135,441

(42,633,400)

Cash and cash equivalents at the end of the year (1)

900,595,472

629,423,258

(1) Includes:

Cash and banks

Investments with maturities of less than three months

The accompanying Notes 1 to 14 and Exhibits E, F and H
are an integral part of these financial statements.

653,138,802

247,456,670

363,449,825

265,973,433

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

Notes to the
Consolidated
Financial Statements

As of December 31, 2011 and
2010
In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements,
unless otherwise specifically
indicated

Note 1

Basis for the preparation and presentation of the

consolidated financial statements
The consolidated financial statements of Grupo
Clarín S.A. have been prepared in all relevant
aspects in accordance with FACPCE Technical
Resolution No. 21, incorporating all companies

Cablevisión (1)
PRIMA

AGEA

AGR

CIMECO
ARTEAR (2)
Pol-Ka

IESA

Radio Mitre

GCGC

CMD

GC Services

GCSA Investments

in which the Company has, directly or
indirectly, a controlling interest.

Below is a detail of the most relevant
subsidiaries consolidated under the line-by-line
consolidation method, together with the direct
and indirect interest the Company holds in the
capital stock and votes of each subsidiary, as of
each date indicated below:

December 31, 2011

December 31, 2010

59.9%

100.0%

99.2%
55.0%

100.0%

59.9%

100.0%

99.2%
55.0%

100.0%

(1) Includes Multicanal and Teledigital, which were merged
into Cablevisión effective as of October 1, 2008 (see Note 8.2.c).
(2) % in votes amounts to 99.7%.

Furthermore, the subsidiaries where Grupo
Clarín exercises common control (either directly
or indirectly) have been consolidated under the
proportional consolidation method. Below is a

detail of the most relevant subsidiaries
consolidated under the proportional method
and the indirect interest the Company holds in
each subsidiary, as of each date indicated below:

TRISA

TSC

Ideas del Sur
Papel Prensa (3)

(3) An indirect subsidiary under common control consolidated
under the proportional method until March 31, 2010.

December 31, 2011

December 31, 2010

50.0%

30.0%

50.0%

30.0%

Finally, the Company accounts for its equity
interests in companies where it exerts significant
influence by applying the equity method.

The subsidiaries’ financial statements used for
consolidation purposes bear the same closing
date as the consolidated financial statements,
comprise the same years and have been prepared
under exactly the same accounting policies as
those used by the Company, which are
described in the notes to the parent company
only financial statements or, as the case may be,
adjusted as applicable.

As a result of the situation described in Note
8.7.a), among other things, as of the date of
these financial statements Papel Prensa has not
issued its annual financial statements as of
December 31, 2011. To calculate the equity
value of its investment in Papel Prensa, the
Company has relied on the latest financial
statements as of September 30, 2011 approved
by Papel Prensa’s Board of Directors and on
AGEA’s estimate of the October-December
2011 results. However, the Company considers
that any deviation between its estimates and the
financial statements as of December 31, 2011
ultimately approved by Papel Prensa’s Board of
Directors will not have a material effect on these
financial statements.

Additionally, the information included in Note
1.2 to these financial statements is based on
AGEA’s estimate of the adjustments concerning
Papel Prensa derived from the application of
IFRS as of December 31, 2011.

1.1. Summary of critical accounting policies
The following is a description of the most
critical accounting policies applied in the
preparation of the consolidated financial
statements in addition to those discussed in
Note 2.2 to the parent company only financial
statements.

a. Trade receivables
Trade receivables have been valued at each year-
end at the discounted value of cash flows to be
generated. In the cases where such measurement
does not materially differ from the nominal
value, such receivables have been valued at the
nominal value of the corresponding transaction.
Furthermore, an allowance has been set up for
doubtful accounts, where applicable, considered
to be sufficient to absorb future losses from
uncollectible receivables.

b. Inventories
Inventories have been valued at replacement
cost or latest production cost under regular
purchasing or production conditions, as
applicable. Their book value does not exceed
their estimated recoverable value.

The criterion followed to expense these items is
as follows:

- Film Rights (series, soap operas and films) and
programs purchased:
The cost of series, soap operas and programs
purchased to be shown on broadcast television is
mainly expensed against the cost of sales on the
exhibition date or upon expiry of exhibition rights.

Rights related to these programs acquired in
perpetuity, if any, are amortized over their
estimated useful life (eight years, with a grace
period of three years and are subsequently
amortized on a straight-line basis over the next
five years).

Films are expensed against the cost of sales on a
decreasing basis, based on the number of
showings granted by the respective rights or
upon expiry of exhibition rights.

Film rights acquired in perpetuity for
broadcasting by the Volver channel are
amortized over their estimated useful life (seven
years, with a grace period of four years. They are
subsequently amortized on a decreasing basis
over the next three years).

- In-house production programs and co-
productions:
In-house production programs and co-
productions cost is mainly expensed against the
cost of sales after broadcasting of the chapter or
program. Rights related to in-house production
programs and co-productions acquired in
perpetuity, if any, are amortized over their
estimated useful life (eight years, with a grace
period of three years and are subsequently
amortized on a straight-line basis over the next
five years).

- Events:
The cost of events is fully expensed against the
cost of sales at the time of broadcasting.
Advances for the purchase of inventories have
been valued as per the amounts disbursed, at the
exchange rate prevailing at the end of the
period, if appropriate. The values thus obtained

do not exceed their respective recoverable values
estimated at the end of the year.

c. Other assets
Deferred charges have been valued at the
amounts actually disbursed.

As of December 31, 2010, investments
denominated in foreign currency subject to
restrictions on disposition under financial
covenants have been valued at face value plus
interest accrued thereon, at the exchange rate
prevailing as of the end of the that year.
The other assets included in this item have been
valued at acquisition cost, except for those assets
with an agreed-upon sale price fixed under a
contract, which have been valued at net
realizable value.

Where applicable, the value of improvements
has been added, net of the related accumulated
depreciation calculated on a straight-line basis,
considering the estimated useful life of the asset.
The asset value does not exceed its estimated
recoverable value.

d. Long-term investments
Long-term investments over which the
Company does not exert significant influence
have been valued at cost.

Certain long-term investments in Radio Mitre
have been carried at zero value, based on
Management’s expectations for such subsidiaries.
The goodwill generated by recent acquisitions is
a preliminary estimate until a final estimate is
made of the fair market value of assets and
liabilities identifiable at the time of acquisition.
Therefore, these values may be modified in the
future, as permitted by the prevailing
accounting standards.

e. Property, plant and equipment and intangible
assets
Materials have been valued at acquisition cost,
restated as set forth in Note 2.1 to the parent
company only financial statements, net of the
allowance for obsolescence.

Improvements that extend the lives of the assets
have been capitalized. Other repair and
maintenance expenses have been expensed as
incurred. Financial costs related to the financing
with loan capital generated by the construction,
assembly and finishing of property, plant and
equipment on a long-term basis have been
capitalized.

The item External network and broadcasting
equipment under Property, plant and
equipment includes the initial installation costs
comprising materials, labor and general
installation expenses. These costs are amortized
over the average term during which subscribers
maintain their subscription to the service.

Property, plant and equipment added as a result
of acquisitions of subsidiaries have been valued
at the respective current values as of the date of
each transaction.

Intangible assets have been valued at acquisition
cost, restated as set forth in Note 2.1 to the
parent company only financial statements, net
of the related accumulated amortization.
Intangible assets are amortized on a straight line
basis, taking into account their estimated useful
lives.

Subscriber portfolio has been valued based on
the future cash flows estimated for such
portfolio and is amortized on a straight-line
basis over its estimated useful life, at a
subscriber turnover rate that ranges from 7 to
10 years.

The book value of these assets does not exceed
their estimated recoverable value. Nevertheless,
as mentioned in Note 15 to the parent company
only financial statements and in Note 11 to the
consolidated financial statements, this estimate
could be affected by the final outcome of the
circumstances described in such note.

f. Provisions
- For doubtful accounts: comprises doubtful
accounts estimated by each company’s
Management at each year-end, based on the
opinion of legal counsel, where appropriate.
- For impairment of inventories, property, plant
and equipment and obsolescence of materials:
determined based on the estimates of each
company’s management at the closing of each
year, where appropriate, regarding the future
consumption of potentially obsolete or slow-
moving assets.

- For contingencies: estimated by each
company’s management, based on the
evaluation of contingent situations at each year-
end, according to the reports of the legal
counsel, if any.

g. Exchange differences
Pursuant to CPCECABA Resolution MD No.
3/02, foreign exchange differences occurring on
or after January 6, 2002 arising from the
devaluation of the Argentine currency and other
associated effects related to liabilities
denominated in foreign currency as of such date
were charged to the cost of assets acquired or
built through such financing, provided such link
is direct (the “direct method”). As an alternative
criterion, companies could opt to give a similar
treatment to exchange differences arising from
indirect financing (the “indirect method”).

Subsequently, the CPCECABA issued
Resolution CD No. 87/03 which suspended
such accounting treatment of foreign exchange
differences and required exchange differences to
be charged to income as from July 29, 2003.

Exchange differences in the goodwill of
Multicanal as of December 31, 2002, which
were determined in accordance with the direct
method, remain capitalized. The residual value
of such capitalizations as of December 31, 2011
and December 31, 2010 is approximately Ps. 22
million.

h. Revenue recognition
The criterion followed to charge revenues to
income is as follows:

Sales of cable or Internet services subscriptions
were recognized as revenues for the period in
which the services were rendered.

Advertising sales revenues were recognized for
the period in which advertising is published
(printing media and Internet) or broadcast
(cable, television and radio).

Circulation sales revenues are recognized in the
period circulation of publications begins, net of
returns.

In accordance with Argentine professional
accounting standards, since no specific standard
exists for the recognition of revenues from
transactions that include multiple items, an
accounting policy has been established to record
these transactions based on international
financial reporting standards. Revenues from
transactions that include multiple items, in
connection with the agreement described under
Note 12, have been recognized separately to the
extent they have commercial substance on their

own. The amount of revenues allocated to each
item is based on its fair value, which is assessed
or estimated at market value.

Revenues from the sale of assets are recognized
only when the risks and benefits arising from
the use of the disposed assets have been
transferred, when the amount of revenues may
be fairly estimated, and when economic benefits
are likely to be obtained.

Installment sales are recognized at the value of
future income discounted at a market rate
assessed at the beginning of the transaction.

i. Barter transactions
The Company sells advertising spaces in
exchange for goods or services. Revenues were
booked when the advertisement was made, and
the goods or expenses were booked when the
goods were received or the services were used.
The goods or services to be received in
consideration of the advertisements made are
recorded as Trade receivables. The
advertisements to be made in exchange for the
goods and services received are recorded as
Accounts payable.

1.2 Adoption of the International Financial
Reporting Standards (IFRS)
The CNV, through General Resolutions No.
562/09 and 576/10, has provided for the
application of FACPCE Technical Resolutions
No. 26 and 29, which adopted IFRS issued by
the International Accounting Standards Board
(IASB), for entities that are subject to the public
offering regime governed by Law No. 17,811
due to the listing of their shares or notes, and
for entities that have applied for authorization
to be listed under said regime.

Application of these standards shall be
mandatory for the Company as from the fiscal
year beginning January 1, 2012. The first
consolidated quarterly financial statements
under IFRS shall be those for the three-month
period ended March 31, 2012.

Therefore, the transition date for the adoption
of the IFRS by the Company, as established in
IFRS No.1 “First-time adoption of the IFRS”,
shall be January 1, 2011.

These consolidated financial statements of
Grupo Clarín S.A. have been prepared in
accordance with General and Particular

Accounting Valuation and Disclosure Standards
required by CNV General Resolutions No.
441/03, 485/05, 487/05 and 494/06, which
differ from IFRS in terms of measurement and
disclosure.

1.2.a) Optional exemptions from IFRS
IFRS No. 1 allows companies adopting IFRS
for the first time to consider certain one-time
exemptions from retrospective application of
certain IFRS applicable to financial statements
as of December 31, 2011. Such exemptions
have been established by IASB in order to
simplify the first application of such standards.

The optional exemptions under IFRS No. 1
applicable to Grupo Clarín S.A. are detailed
below:

1. Deemed cost of Property, plant and
equipment: The cost of property, plant and
equipment, adjusted for inflation in accordance
with effective accounting standards, has been
considered as the deemed cost at the IFRS
transition date, since it is similar to the cost or
depreciated cost under IFRS, adjusted to reflect
the changes of a general or specific price index.

2. Accumulated translation differences of
foreign operations: Accumulated translation
differences related to foreign operations were
considered null at the IFRS transition date.

3. Business combinations: The Company has
elected not to apply IFRS No. 3 “Business
combinations” on a retrospective basis for
business combinations that occurred prior to the
IFRS transition date.

The Company has not used the other
exemptions available under IFRS No. 1.

1.2.b) Mandatory exceptions to IFRS
The mandatory exceptions to IFRS No. 1
applicable to the Company are detailed below:

1. Estimates: The estimates made by the
Company under IFRS at the IFRS transition
date are consistent with the estimates made at
the same date under Argentine Professional
Accounting Standards (NCP ARG).

2. The other mandatory exceptions provided by
IFRS No. 1 that have not been considered since
they are not applicable to the Group are the
following:
• Derecognition of financial assets and
liabilities.
• Hedge accounting.
• Non-controlling interest.
• Embedded derivatives.

1.2.c) Mandatory reconciliations
Pursuant to FACPCE Technical Resolutions
No. 26 and No. 29, the following is a detail of
the reconciliations of shareholders’ equity
reported under NCP ARG to that reported
under IFRS as of December 31, 2011 and
January 1, 2011 and the reconciliation of
comprehensive income for the year ended
December 31, 2011. In this sense, the
Company has considered in the preparation of
reconciliations those IFRS estimated to be
applicable to the preparation of its financial
statements as of December 31, 2012. The items
and figures contained in this note are subject to
changes and may only be deemed final once the
Company has prepared the annual financial
statements for the year in which the IFRS are
applied for the first time.

a) Reconciliation of shareholders’ equity as of December 31, 2011 and January 1, 2011.

Shareholders’ equity under NCP ARG

Effect of transition to IFRS:

Addition of the item Minority interest under

NCP ARG to Shareholders’ equity

Subtotal

Adjustment to inventories valuation [1]
Adjustment for derecognition of pre-operating expenses [2]
Derecognition of exchange differences capitalization [3]
Derecognition of the adjustment for inflation to
intangible assets [4]
Recording of options on minority interests [5]
Adjustment for deferral of installation revenues [6]
Effect of special purpose entities consolidation [7]
Recognition of minority interest acquisition [8]
Derecognition of the adjustment for inflation of
certain subsidiaries [9]
Tax effect of adjustments under IFRS [10]
Adjustment to the valuation of affiliates [11]
Other minor adjustments

Total Shareholders’ equity under IFRS

Shareholders’ equity under IFRS attributable

to majority shareholders

Shareholders’ equity under IFRS attributable

to minority interest

December 31, 2011

3,735,204,430

January 1,2011

3,284,857,240

1,037,401,294

4,772,605,724

(9,558,846)

(446,476)

(22,904,194)

(1,518,634)

(18,054,721)

(114,740,203)

73,886,214

(7,007,606)

(16,755,564)
44,266,017

(627,693)

(1,356,132)

4,697,787,886

918,479,254

4,203,336,494

(7,269,959)

(656,221)

(22,904,194)

(1,857,552)

(22,249,442)

(90,172,164)

49,541,445

-
34,852,783

(1,818,667)

(1,108,355)

4,139,694,168

3,634,142,107

3,203,295,205

1,063,645,779

936,398,963

b) Reconciliation of consolidated income for the year ended December 31, 2011

Net income for the year under NCP ARG (Income)

Effect of transition to IFRS:

Addition of the item Minority interest under NCP ARG to

Comprehensive income for the year

Addition of the variation of Cumulative translation adjustment

under NCP ARG to Comprehensive income for the year
Subtotal

Adjustment to inventories valuation [1]
Adjustment for derecognition of pre-operating expenses [2]
Derecognition of the adjustment for inflation to intangible assets [4]
Recording of options on minority interests [5]
Adjustment for deferral of installation revenues [6]
Effect of consolidation of special purpose entities and other companies [7]
Derecognition of the adjustment for inflation of certain subsidiaries [9]
Tax effect of adjustments under IFRS [10]
Adjustment to the valuation of affiliates [11]
Other minor adjustments

Total comprehensive income for the year under IFRS

Comprehensive income for the year under IFRS attributable to majority shareholders

Comprehensive income for the year under IFRS attributable to minority interest

December 31, 2011

522,279,377

267,152,452

86,654,781
876,086,610

(2,288,887)

209,745

338,918

(960,000)

(24,568,039)

24,344,769

(16,755,564)

9,413,234

1,190,974

(247,777)

866,763,983

552,746,145

314,017,838

c) Explanation of reconciling items
[1] Pursuant to NCP ARG, the valuation
criterion applicable to inventories is replacement
cost. As part of the transition process to IFRS,
inventories will be valued at the lower of
historical cost or net realizable value. In the
income statement, this adjustment will have an
impact in the item Cost of sales and in
Financial income.

[2] Pursuant to NCP ARG, the Company and
its subsidiaries maintain the capitalization under
Intangible assets of certain items not accepted
by IFRS. As part of the transition process to
IFRS and since such items do not meet the
requirements established by IFRS for their
capitalization, the Company will reverse the
residual value against Retained earnings in the
financial statements prepared under IFRS at the
transition date. The impact in the Consolidated
Statements of Comprehensive Income will be
disclosed as decreased amortization of such
assets due to the reversal in the first financial
statements prepared under IFRS.

[3] Under NCP ARG certain exchange
differences arising from the exit from the
convertibility regime and subsequent
devaluation of the Argentine Peso had been
capitalized (see Note 1.1.g). Exchange
differences cannot be capitalized at the cost of
acquisition of non-financial assets under IFRS.
Therefore, the residual value of exchange
differences included in such assets will be
reversed against Retained earnings in the
financial statements prepared under IFRS at the
transition date. No impact will be recorded in
the Consolidated Statements of Comprehensive
Income since they are non-financial assets which
are not subject to amortization.

[4] Under NCP ARG the financial statements
of all the subsidiaries were adjusted for inflation
during inflationary periods that distorted the
figures contained in the financial statements.
The last period in which figures were adjusted
for inflation was January 2002 to February
2003. Under the criteria set forth by IAS 29,
such period should not be considered as
hyperinflationary and, therefore, the adjustment
for inflation would not be applicable to the
financial statements under IFRS. The intangible
assets for which there is not an active market do
not fall within the optional exemption provided
by IFRS 1 described Note in 1.2.a), which was

adopted by the Company. Therefore, the
residual value of the adjustment for inflation
recorded in such period, contained in the
balance of intangible assets, will be reversed
against Retained earnings in the financial
statements prepared under IFRS at the
transition date. The impact in the Consolidated
Statements of Comprehensive Income will be
disclosed as decreased amortization of such
intangible assets.

[5] There are put options held by minority
shareholders that may force certain subsidiaries
to acquire a portion or all of such equity
interests. Under IFRS the Company has to
recognize the liability arising from the present
value of the best estimate of the amount payable
in case the minority shareholder exercises the
put option. The offsetting entry of such liability
will be recorded against Minority interest based
on the percentage of the net assets underlying
the option, while the difference between both
values will be recorded under Shareholders’
equity. Such liability has not been recorded in
the financial statements in accordance with
NCP ARG.

[6] In accordance with NCP ARG the
Company adopted as accounting practice for
the recognition of revenues from cable TV and
Internet installation services the deferral of the
amount of these revenues that exceeds the direct
expenses incurred to obtain new subscribers in
the same period. Under IFRS the Company has
deferred all of the above-mentioned revenues
amortized over the average term during which
subscribers maintain their subscription to the
service, thus generating higher net liabilities
from deferred revenues. The effect shall be
reflected in the Consolidated Statements of
Comprehensive Income, in the sales revenues
item.

[7] NCP ARG requires the consolidation of
subsidiaries based on the effective or potential
equity interests that grant the Company the
majority of votes at corporate or shareholders’
meetings, including those cases in which control
is obtained through agreements executed with
other shareholders. IFRS requires the
consolidation of special purpose entities in
which control is exerted through other means.
One of the Company’s indirect subsidiaries has
executed certain agreements of this kind with
other companies in which it does not hold an

equity interest, for the purposes of rendering
certain services on behalf of and by order of
such companies. The net effect of the assets,
liabilities and net income balances consolidated
by these entities is disclosed, in accordance with
IFRS, under minority interest in Shareholders’
equity and Net income.

[8] Under NCP ARG the amount in excess of
the cost paid during the year 2011 for the
acquisition of minority interests in subsidiaries
has been recognized as goodwill. As a
consequence of the transition to IFRS, and as
established by IAS 27, such excess amount shall
be charged to Shareholders Equity.

[9] In accordance with NCP ARG the balances
disclosed in the financial statements of
Cablevisión’s subsidiaries in Uruguay and
Paraguay were adjusted for inflation until the
date of transition to IFRS (January 1, 2011)
taking into consideration the inflationary
context of such countries. IAS 29 requires the
adjustment for inflation of financial statements
in countries with hyperinflationary economies.
Under the criteria set forth by IAS 29, Uruguay
and Paraguay’s economies should not be
considered as hyperinflationary and, therefore,
the adjustment for inflation would not be
applicable to the financial statements under
IFRS.

The Company has elected to adopt the optional
exemption mentioned in Note 1.2.a).1 above.
Therefore, as from the date of transition to
IFRS the adjustment for inflation will no longer
be applied to such subsidiaries’ financial
statements. The related items included in the
reconciliation of consolidated income for the
year ended December 31, 2011 arise from the
reversal of the adjustment for inflation of these
subsidiaries recorded under NCP ARG in the
year 2011.

Increase of Net deferred tax liabilities
Decrease of Investment in unconsolidated affiliates

Decrease of Minority interest

Net effect - Decrease in Shareholders’ equity

[10] This reconciliation includes the tax effect
of the adjustments made in the transition to
IFRS. The effect of these adjustments will be
reflected in the Consolidated Statements of
Comprehensive Income under income tax.

[11] Generated by the effect of the disclosures
made in [1] and [10] above with respect to
investments in affiliates.

In addition to the differences explained above,
in the Consolidated Balance Sheets and the
Consolidated Statements of Comprehensive
Income to be prepared under IFRS the assets,
liabilities and net income of those companies in
which common control is exercised will not be
consolidated under the proportional method
because in accordance with IFRS they will be
disclosed in one item under Long-term
investments of the Consolidated Balance Sheet
and under Equity in earnings (losses) from
affiliates and subsidiaries of the Consolidated
Statement of Comprehensive Income.

d) Reconciliation of the Consolidated Statement
of Cash Flows for the year ended on December
31, 2011.

No other significant differences have been
identified in the Consolidated Statement of
Cash Flows or in the definition of Cash and
cash equivalents between NCP ARG and IFRS,
except for the impact of the deconsolidation of
subsidiaries in which common control is
exerted, which in accordance with IFRS are not
consolidated under the proportional method
but disclosed as net in one item, and except for
the information mentioned in [7] c) above.

1.3 Change in accounting policy. Adjustment
to net income from prior years
As mentioned in Note 2.4 to the parent
company only financial statements, below is a
detail of the impact of the amounts consolidated
as of December 31, 2010, presented for
comparative purposes:

December 31, 2010

(35,883,482)
(12,027,805)

3,880,583

(44,030,704)

Note 2

Breakdown of main accounts

a. Short-term Investments

December 31, 2011

December 31, 2010

Current

Financial instruments

Mutual funds

Equity interests (See Note 9.1.d.)

b. Trade receivables

Current

Trade receivables

Allowance for doubtful accounts - Exhibit E Consolidated

Non-Current

Trade receivables

c. Other receivables

Current

Tax credits

Court-ordered and guarantee deposits

Pre-paid expenses

Advances

Derivatives - Note 7

Related parties

Other receivables

Other 43,357,839 30,297,524

Allowance for other doubtful accounts -

Exhibit E Consolidated

Non-Current

Net deferred tax assets - Note 13

Tax credits
Guarantee deposits

Pre-paid expenses

Loans granted

Advances

Related parties

Other

Allowance for other doubtful accounts -

Exhibit E Consolidated

193,735,274

64,485,370

258,220,644

1,425,095,392

(129,299,862)

1,295,795,530

122,595,188

131,239,968

11,632,708

76,431,273

41,538,058

4,010,407

14,523,547

(727,212)

322,006,588

29,243,782

31,919,817
1,162,599

61,425,011

3,871,222

1,130,127

7,763,841

15,483,961

(2,725,649)

149,274,711

71,353,843

194,945,718

10,948,000

277,247,561

1,144,833,182

(128,836,360)

1,015,996,822

1,404,343

56,264,516

9,545,622

47,733,952

39,441,057

37,348,003

16,528,946

12,006,712

(669,023)

248,497,309

25,123,948

25,665,307
873,115

12,842,925

3,842,313

2,581,566

7,055,251

15,530,539

(2,725,649)

90,789,315

d. Inventories

Current

Raw materials and supplies

Products-in-process

Finished and resale products

Computer equipment held by third parties

Film products and rights

Other

Subtotal

Advances to suppliers

Allowance for impairment of inventories -

Exhibit E Consolidated

Non-Current

Film products and rights

Subtotal

Advances to suppliers

e. Investment in unconsolidated affiliates

Papel Prensa

Ver TV S.A.

TPO

TATC

TSMA

La Capital Cable

Other investments

Advances for future investments

Allowance for investment impairment -

Exhibit E Consolidated

December 31, 2011

December 31, 2010

256,873,304

973,397

16,484,770

21,531,761

98,578,513

199,126

394,640,871

190,372,287

2,161,336

16,676,028

55,375,341

987,735

265,572,727

46,387,132

24,077,982

(3,176,265)

437,851,738

16,964,960

194,029,432

15,656,650

10,822,223

6,722,931

10,060,515

14,984,238

15,534,202

150,000

(428,809)

267,531,382

(511,490)

289,139,219

26,739,712

3,307,500

30,047,212

185,297,290

15,656,651

10,822,223

5,847,539

10,060,515

6,218,710

6,596,979

181,771

(355,609)

240,326,069

f. Property, plant and equipment, net

Main account

acquisition

depreciation

2011

2010

Cost of

Accumulated

December 31,

Net book

value as of

Net book

value as of

Real property

Furniture and fixtures

560,744,171

(233,552,755)

327,191,416

330,833,238

97,367,568

(79,031,088)

18,336,480

34,539,586

17,063,164

26,209,410

Telecommunication, audio and video i t

228,207,741

(193,668,155)

External network and

broadcasting equipment

Computer equipment and software

Technical equipment

Workshop machinery

Tools

Spare parts

Installations

Vehicles

Plots

Leased assets

Other materials and equipments

Works-in-progress

Leasehold improvements

Advances to suppliers

Subtotal

Allowance for property, plant and

equipment impairment and obsolescence

2,881,648,497

(954,937,554)

1,926,710,943

1,410,864,259

479,953,127

111,080,086

583,446,189

51,347,441

41,373,418

437,109,614

171,651,196

14,737,375

1,091,138

457,140,498

485,401,971

33,575,106

88,798,187

(379,121,135)

(79,769,950)

(523,711,405)

(38,704,271)

(32,669,077)

(328,050,468)

(115,690,568)

(13,714,186)

(250,132)

(25,620,068)

100,831,992

110,606,215

31,310,136

59,734,784

12,643,170

8,704,341

109,059,146

55,960,628

1,023,189

841,006

457,140,498

485,401,971

7,955,038

88,798,187

31,009,249

60,028,490

11,190,305

7,294,376

154,691,002

28,975,917

348,782

1,293,729

451,037,744

160,287,889

7,842,739

33,902,265

6,724,673,323

(2,998,490,812)

3,726,182,511

2,843,478,773

of materials - Exhibit E Consolidated

(15,632,479)

(15,634,149)

Total as of December 31, 2011

Total as of December 31, 2010

6,709,040,844

(2,998,490,812)

3,710,550,032

5,406,052,549

(2,578,207,925)

2,827,844,624

Balance at the beginning of the year

Additions for the year

Additions (retirements) from consolidation /

deconsolidation of subsidiaries for the year

Retirements for the year

Transfers and other movements for the year

Depreciation for the year

Balance at year-end

Net book

value as of

December
31, 2011

Net book

value as of

December
31, 2011

2,827,844,624

2,522,621,307

1,633,721,394

1,088,997,381

733,147

(137,393,793)

22,009,946

(167,505,579)

(128,291,479)

545,948

(636,365,286)

(488,522,954)

3,710,550,032

2,827,844,624

g. Intangible Assets, net

Net book

value as of

Net book

value as of

Main account

acquisition

amortization

2011

2010

Cost of

Accumulated

December 31,

Organizational expenses,

pre-operating costs and licenses

Exclusivity agreements

Other rights

6,116,006

50,847,513

73,745,643

(5,351,504)

(20,285,930)

(59,410,820)

764,502

30,561,583

14,334,823

1,461,026

34,470,448

36,417,565

Subscriber portfolio acquired

1,057,944,050

(574,135,911)

483,808,139

592,193,943

Trademarks and patents

Deferred charges

Projects in-progress

Other

5,479,295

14,662,619

64,126,242

90,971,448

(4,289,222)

(9,984,855)

(60,672,672)

Total as of December 31, 2011

Total as of December 31, 2010

1,363,892,816

1,298,321,176

(734,130,914)

(578,808,418)

1,190,073

4,677,764

64,126,242

30,298,776

629,761,902

1,023,984

3,525,464

32,338,944

18,081,384

719,512,758

Balance at the beginning of the year

Additions for the year

Retirements for the year

Transfers and other movements for the year

Amortization for the year

Balance at year-end

Net book

value as of

Net book

value as of

December 31,

2011

2010

719,512,758

57,059,814

(9,104)

40,701

822,222,753

25,785,954

(80,442)

795,950

(146,842,267)

(129,211,457)

629,761,902

719,512,758

h. Goodwill

Main account

Allowance

for goodwill

Net book

impairment

Balances as of

value before

(Exhibit E

December 31,

impairment

Consolidated)

2011

2010

Cablevisión and subsidiaries (1)

3,250,671,488

(746,572,936)

2,504,098,552

2,461,913,028

PRIMA

CIMECO and affiliates

Cúspide and subsidiaries (Note 9.1.f)

Telecor

Grupo Carburando

Pol-Ka

Patagonik

Telba

Canal Rural

Bariloche TV

Other

2,272,319

235,982,248

(54,637,313)

181,344,935

180,286,033

23,559,945

39,173,062

12,053,573

(12,053,573) (2)

16,130,769

(6,850,727)

6,197,435

3,774,071

1,742,346

1,844,621

23,559,945

39,173,062

9,280,042

6,197,435

3,774,071

1,742,346

1,844,621

39,173,062

12,053,573

9,280,042

6,197,435

3,774,071

1,742,346

1,844,621

18,554,482

(533,130)

18,021,352

13,448,590

Total as of December 31, 2011

Total as of December 31, 2010

3,611,956,359

(820,647,679)

2,791,308,680

3,540,579,226

(808,594,106)

2,731,985,120

(1) Includes the goodwill of Multicanal and Teledigital,
currently merged into Cablevisión (see Note 8.2.c).
(2) See Note 14.a).

i. Accounts payable

Current

Suppliers

Related parties

Non-Current

Suppliers

j. Long-term debt

Current

Bank overdraft

Financial loans

Negotiable obligations

Acquisition of equipment

Related parties

Interest and restatements

Measurement at fair value

Non-Current

Financial loans
Negotiable obligations

Acquisition of equipment

Related parties

Interest and restatements

Measurement at fair value

December 31,

2011

2010

1,162,956,411

77,479,387

1,240,435,798

790,243,242

53,922,206

844,165,448

16,450,399

20,781,453

52,088,509

118,179,975

129,000,000

42,591,825

13,264,292

86,901,402

3,935,489

9,979,032

42,754,595

133,904,847

35,963,095

5,093,485

33,239,699

3,333,740

445,961,492

264,268,493

136,911,091
2,583,977,500

95,022,667

2,858,933

1,857,741

(58,609,546)

120,139,090
1,964,840,968

36,875,131

2,541,636

1,004,041

4,492,370

2,762,018,386

2,129,893,236

k. Other liabilities

Current

Advances from customers

Dividends payable

Related parties

Derivatives - Note 7

Other

Non-Current

Net deferred tax liabilities - Note 13

Related parties

Guarantee deposits

Other

December 31,

December 31

2011

2010

48,916,985

4,232,562

487,819

4,344,000

48,133,016

106,114,382

45,781,822

2,134,072

1,197,481

44,693,411

93,806,786

232,020,446

258,228,858

1,986,889

9,792,774

439,533

1,975,322

5,357,220

243,800,109

266,000,933

Note 3

Segment information
The Company is mainly engaged in media and
entertainment activities, which are carried out
through the companies in which it holds a
participating interest. Based on the nature,
clients, and risks involved, the following
business segments have been identified, which
are directly related to the way in which the
Company’s management assesses its business
performance:
- Cable Television & Internet Access: it is
basically comprised of the operations of its
subsidiary Cablevisión and its subsidiaries,
mainly PRIMA.
- Printing & Publishing: it is basically
comprised of the operations of its subsidiary
AGEA and its subsidiaries AGR, Tinta Fresca,
Papel Prensa (see Note 1 to the consolidated
financial statements) and CIMECO and its
subsidiaries.

- Broadcasting and Programming: it is basically
comprised of the operations of its subsidiaries
ARTEAR, IESA and Radio Mitre, and their
respective subsidiaries, including Telecor, Telba,
Pol-Ka, Auto Sports (1), Grupo Carburando, and
the companies under common control, such as
Ideas del Sur, TRISA and TSC.
- Digital Content and Other: it is basically
comprised of the operations of its controlled
companies CMD and subsidiaries, and OSA.
Additionally, this segment includes the
Company’s own operations (typical of a
holding) and those carried out by its controlled
company GCGC.

(1) During the year ended December 31, 2010,
Automóviles Deportivos 2000 S.A. changed its
corporate name to Auto Sports S.A.

The following tables include the information as
of December 31, 2011 and 2010 for each of the
business segments identified by the Company:

Information arising from consolidated statements of income as of December 31, 2011

Net sales to third parties

Intersegment net sales

Net sales

Cost of sales (excluding depreciation and amortization)

Subtotal

Expenses (excluding depreciation and amortization)

- Selling expenses

- Administrative expenses

Depreciation of property, plant and equipment and other investments

Amortization of intangible assets, goodwill and other assets

Financing and holding results

- Generated by assets

- Generated by liabilities

Equity in earnings from unconsolidated affiliates, net

Other income (expense), net

Income before income tax, tax on assets and minority interest

Income tax and tax on assets

Minority interest

Net income / (loss) for the year

Information arising from consolidated balance sheets as of December 31, 2011

Total Assets

Total Liabilities

Additional consolidated information as of December 31, 2011

Acquisition of property, plant and equipment, net

Acquisition of intangible assets

Cable television and

Internet access

6,327,650,095

9,235,522

6,336,885,617

(2,805,719,070)

3,531,166,547

(703,190,072)

(771,332,103)

(547,568,709)

(111,915,589)

(56,546,469)

(390,956,226)

8,951,042

5,923,486

964,531,907

(338,644,473)

(260,862,620)

365,024,814

7,617,518,399

4,285,000,337

1,390,607,930

42,685,454

Printing and publishing

programming

Digital content and other

Deletions

Total

Broadcasting and

2,039,238,191

119,499,221

2,158,737,412

(1,237,842,663)

920,894,749

(358,068,704)

(305,758,227)

(51,250,740)

(5,345,779)

(14,478,542)

(64,856,048)

7,652,537

9,088,329

137,877,575

(45,117,805)

(5,776,078)

1,280,623,928

183,105,913

1,463,729,841

(909,220,302)

554,509,539

(108,531,625)

(160,471,965)

(31,319,574)

(27,557,275)

(25,922,479)

(26,627,347)

18,299

223,536

174,321,109

(65,494,594)

114,754

105,034,750

177,924,686

282,959,436

(125,283,686)

157,675,750

(55,269,992)

(102,972,633)

(6,802,880)

(4,762,238)

7,220,670

(20,683,321)

42,718

(7,511,413)

(33,063,339)

(4,978,551)

(628,508)

86,983,692

108,941,269

(38,670,398)

(489,765,342)

205,575,179

(284,190,163)

138,773,786

145,416,377

(514,672)

514,672

9,752,546,964

(4,872,490,542)

4,880,056,422

(1,086,286,607)

(1,195,118,551)

(636,941,903)

(149,580,881)

(90,241,492)

(502,608,270)

16,664,596

7,723,938

1,243,667,252

(454,235,423)

(267,152,452)

522,279,377

1,739,694,395

1,005,108,267

1,147,578,519

636,080,437

35,056,605

7,953,814

79,308,748

167,996

423,660,578

229,657,126

6,235,691

6,333,502

(243,093,923)

10,685,357,968

5,912,752,244

1,511,208,974

57,140,766

Information arising from consolidated statements of income as of December 31, 2010

Net sales to third parties

Intersegment net sales

Net sales

Cost of sales (excluding depreciation and amortization)

Subtotal

Expenses (excluding depreciation and amortization)

- Selling expenses

- Administrative expenses

Depreciation of property, plant and equipment and other investments

Amortization of intangible assets, goodwill and other assets

Financing and holding results

- Generated by assets

- Generated by liabilities

Equity in earnings from unconsolidated affiliates, net

Other income (expense), net

Income before income tax, tax on assets and minority interest

Income tax and tax on assets

Minority interest

Net income / (loss) for the year

Information arising from consolidated balance sheets as of December 31, 2010

Total Assets

Total Liabilities

Additional consolidated information as of December 31, 2010

Acquisition of property, plant and equipment, net

Acquisition of intangible assets

Cable television and

Internet access

4,877,747,616

7,313,732

4,885,061,348

(2,011,076,406)

2,873,984,942

(494,294,364)

(550,185,857)

(396,341,467)

(112,075,243)

(52,531,799)

(270,867,141)

6,931,886

7,061,242

1,011,682,199

(364,992,543)

(268,379,546)

378,310,110

6,333,492,089

3,291,542,411

866,808,431

17,825,763

Printing and publishing

programming

Digital content and other

Deletions

Total

Broadcasting and

1,675,407,292

128,639,736

1,804,047,028

(967,682,831)

836,364,197

(287,453,374)

(245,546,314)

(56,859,501)

(2,939,515)

13,739,807

(63,259,215)

(2,294,358)

2,749,084

194,500,811

(72,180,184)

(4,895,323)

975,727,288

148,962,410

1,124,689,698

(695,678,708)

429,010,990

(60,094,270)

(157,439,565)

(27,456,624)

(10,425,379)

(10,111,858)

(21,092,711)

388,122

5,011,937

147,790,642

(53,627,536)

(3,985,694)

103,137,228

137,760,698

240,897,926

(92,284,184)

148,613,742

(57,777,740)

(83,343,598)

(8,096,749)

(4,990,005)

9,767,493

(25,959,408)

(955,027)

(22,323,293)

(45,064,585)

(2,631,891)

(99,470)

117,425,304

90,177,412

(47,795,946)

1,516,656,888

812,236,328

52,240,761

3,439,723

968,480,689

528,028,152

29,469,448

202,141

237,967,682

221,453,963

19,383,917

5,769,734

(422,676,576)

169,617,443

(253,059,133)

138,058,221

115,000,912

(217,886)

217,886

(120,599,149)

7,632,019,424

(3,597,104,686)

4,034,914,738

(761,561,527)

(921,514,422)

(488,754,341)

(130,430,142)

(39,354,243)

(380,960,589)

4,070,623

(7,501,030)

1,308,909,067

(493,432,154)

(277,360,033)

538,116,880

8,935,998,199

4,732,661,705

967,902,557

27,237,361

Note 4

Additional consolidated cash flow statements

information
In the years ended on December 31, 2011 and
2010, the following significant transactions
were carried out, which did not have an impact
on consolidated cash and cash equivalents:

Dividends collected through debt settlement

Debt paid from the reserve account

Interest paid from the reserve account

Financed purchase of property, plant and equipment

Note 5

Borrowings
Consolidated loans include, mainly, the
following:

5.1. Cablevisión - Notes and financial
restructuring process

Cablevisión
On April 7, 2011, Cablevisión cancelled the
total outstanding balance of the Notes issued
under its prepackaged insolvency plan (APE).
Cablevisión’s APE had been judicially confirmed
and deemed completed on October 28, 2009,
pursuant to section 59 of Law No. 24,522. The
cancelled Notes consisted of:
a) USD 744,972 aggregate principal amount of
short-term Notes and b) USD 11,898,272
aggregate principal amount of long-term Notes.

As of December 31, 2011, Cablevisión records
only one loan borrowed from official banks for
USD 2.5 million.

Multicanal
As of December 31, 2011, the only Notes
issued by Multicanal (and assumed by
Cablevisión) under the Multicanal APE - which
was confirmed by the Argentine Commercial
Court of Appeals, Chamber “A” on October 4,
2004 - that remain outstanding are the Series A
Step Up Notes for USD 80,325,000 (“10-Year
Notes ”). The 10-Year Notes accrue interest at a
nominal rate of 2.5% per annum from
December 10, 2003 to the fourth anniversary of
their issue date, 3.5% from the fourth to the

December 31, 2011

December 31, 2010

295,708

60,459,379

8,041,871

9,205,411

133,156,977

150,214,259

4,943,750

eighth anniversary, and 4.5% thereafter until
maturity. On June 20, 2011, payment was made
of the total outstanding balance of Series B
Notes in the amount of USD 2,156,968 (“7-year
fixed rate Notes”).

As a result of the issue of the 10-Year Notes,
Multicanal undertook certain covenants,
including: (i) limitation on the issuance of
guarantees by subsidiaries; (ii) mergers,
consolidations, and sale of assets under certain
conditions, (iii) limitation on incurring debt
above certain approved ratios, (iv) limitation on
capital expenditure exceeding certain amount,
(v) limitation on transactions with shareholders
and affiliates under certain conditions, (vi)
limitation on the issuance and sale of significant
subsidiaries’ shares with certain exceptions.

Some of the covenants originally included in
such Notes were amended at the respective
extraordinary noteholders’ meetings. The
amendments proposed by Multicanal were
approved at each such meeting.

On May 6, 2009, an extraordinary Noteholders’
Meeting was held by the holders of 10-year
Notes in which the noteholders granted a waiver
of certain merger covenants of the 10-year
Notes in connection with the Multicanal and
Cablevisión merger.

On June 30, 2009, pursuant to certain merger
covenants under Multicanal’s 10-year and 7-year
Fixed-Rate Notes, Cablevisión assumed
Multicanal’s obligations under such Notes as
from October 1, 2008, subject to Multicanal’s

merger into Cablevisión becoming effective
under Argentine law.

Issue of Class I, II, III and IV Notes
On January 14, 2011, Cablevisión’s Regular
Shareholders’ Meeting authorized the issue of
non-convertible notes for an aggregate principal
amount of up to USD 600,000,000, to be
privately placed and to be issued in one or more
classes, pursuant to Negotiable Obligations Law
No. 23,576, as amended, and its regulations
(the “Negotiable Obligations Law”).

On February 11, 2011 Cablevisión issued three
classes of Notes to refinance certain financial
indebtedness due within the next years (each of
them, the “Class I Notes”, the “Class II Notes”
and the “Class III Notes”) and to issue an
additional class of Notes, the proceeds of which
will be used to acquire non-financial assets, and
to finance imports (the “Class IV Notes”). Such
Notes were issued privately.

The financial indebtedness that was refinanced
in exchange for the new Class I, II and III
Notes amounted to USD 382,753,634 and
include: (i) USD 88,238,393 aggregate principal
amount of 7-year Fixed-Rate Notes originally
issued by Multicanal; (ii) USD 71,292,197
aggregate principal amount of Short-Term
Notes and (iii) USD 223,223,044 aggregate
principal amount of Long-Term Notes,
collectively (“Cablevisión’s Notes Subject to
Refinancing”). Interest accrued under
Cablevisión’s Notes Subject to Refinancing was
settled in cash at the time of the exchange of
such Notes for Class I, II and III Notes.

On February 11, 2011, as a result of the
refinancing of the notes, Cablevisión recorded a
gain of Ps. 41,021,843.

Below is a summary of the terms and conditions
of the Notes:

The Class I, II, III and IV Notes were issued by
Cablevisión, in its name and as universal
successor to all the assets, rights and obligations
of Multicanal, on February 11, 2011 and they
mature on February 11, 2018. They are payable
in nine equal semiannual installments due in
February and August of each year, starting in
February 2014 and ending in February 2018.
Interest and the permanence fee agreed with the
bank will accrue on the outstanding principal of

each class of Notes as from the date of issue
until full repayment of the outstanding
principal under each class of Notes. Interest and
the permanence fee agreed with the bank
(nominal fee of 0.2% per annum) shall be paid
on a semiannual basis in August and February
of each year. The first interest payment date was
on August 11, 2011.

As a result of the issuance of Class I, II, III and
IV Notes by Cablevisión, certain covenants were
undertaken including: (i) limitation on the
issuance of guarantees by subsidiaries; (ii)
mergers, consolidations, and sale of assets under
certain conditions, (iii) limitation on incurring
debt above certain approved ratios, (iv)
limitation on capital expenditure exceeding
certain amount, (v) limitation on transactions
with shareholders and affiliates under certain
conditions, (vi) limitation on the issuance and
sale of significant subsidiaries’ shares with
certain exceptions.

Terms and conditions governing each class of
Notes.

- Class I Notes: (i) Aggregate principal amount:
USD 88,238,393; (ii) Payment: exchange and
transfer in favor of Cablevisión, of the 7-year
Fixed-Rate Notes, at a rate of USD 1 face value
of Class I Notes for each USD 1 face value of the
7-year Fixed-Rate Notes; (iii) Interest rate:
8.75% nominal interest rate per annum and (iv)
Use of proceeds: Refinancing of the
indebtedness under the 7-year Fixed-Rate Notes.

- Class II Notes: (i) Aggregate principal amount:
USD 71,292,197; (ii) Payment: exchange and
transfer in favor of Cablevisión of the Short-
Term Notes, at a rate of USD 1 face value of
Class II Notes for each USD 1 face value of the
Short-Term Notes; (iii) Interest rate: 9,375%
nominal interest rate per annum and (iv) Use of
proceeds: Refinancing of the indebtedness under
the Short-Term Notes.

- Class III Notes: (i) Aggregate principal
amount: USD 223,223,044; (ii) Payment:
exchange and transfer in favor of Cablevisión of
the Long-Term Notes, at a rate of USD 1 face
value of Class III Notes for each USD 1 face
value of the Long-Term Notes; (iii) Interest rate:
9,625% nominal interest rate per annum and
(iv) Use of proceeds: Refinancing of the
indebtedness under the Long-Term Notes.

- Class IV Notes: (i) Aggregate principal
amount: USD 17,246,366; (ii) Payment: In cash;
(iii) Interest rate: 9,375% nominal interest rate
per annum and (iv) Use of proceeds:
Acquisition of non-financial assets and financing
of imports.

Issue of Class V Notes
On May 17, 2011, Cablevisión issued variable-
rate Class V Notes due May 17, 2014. Principal
on the variable-rate Class V Notes is payable in
eight equal quarterly installments due in
February, May, August and November of each
year, starting in August 2012 and ending in
May 2014. Interest and the permanence fee
agreed with the bank (0.2% nominal interest
rate per annum) will accrue on the outstanding
principal as from the date of issue until full
repayment. Interest and the permanence fee
agreed with the bank shall be paid on a
quarterly basis in February, May, August and
November of each year. The first interest
payment date was on August 17, 2011.

As a result of the issue of its variable-rate Class
V Notes, Cablevisión has undertaken certain
covenants similar to those of the Class I, II, III
and IV Notes.

Terms of the issue of variable-rate Class V
Notes: (i) Aggregate principal amount: USD
50,000,000; (ii) Payment: In cash; (iii) Interest
rate: 3-month US Dollar Libor plus a 7.50%
nominal interest rate per annum (iv) Use of
proceeds: Acquisition of non-financial assets and
financing of imports.

Issue of variable-rate Notes by Primera Red
Interactiva de Medios Argentina (PRIMA) S.A.

On May 17, 2011, PRIMA issued variable-rate
Notes due May 17, 2014. Principal on the
variable-rate Notes issued by PRIMA is payable
in eight equal quarterly installments due in
February, May, August and November of each
year, starting in August 2012 and ending in
May 2014. Interest and the permanence fee
agreed with the bank (0.2% nominal interest
rate per annum) will accrue on the outstanding
principal of each class of Notes as from the date
of issue until full repayment under each class of
Notes. Interest and the permanence fee agreed
with the bank shall be paid on a quarterly basis
in February, May, August and November of
each year. The first interest payment date was
on August 17, 2011.

As a result of the issue of its variable-rate Notes,
PRIMA has undertaken certain covenants,
including the limitation to carry out
transactions with shareholders and affiliates
under certain conditions. Cablevisión is the
guarantor of the issue and the obligor for the
payment of PRIMA’s Notes for up to USD
35,000,000 until March 31, 2012, and for up
to USD 70,000,000 since April 1, 2012 and
thereafter.

Terms of the issue of variable-rate Notes by
PRIMA: (i) Aggregate principal amount: USD
70,000,000; (ii) Payment: In cash; (iii) Interest
rate: 3-month US Dollar Libor plus a 7.50%
nominal interest rate per annum (iv) Use of
proceeds: Acquisition of non-financial assets and
financing of imports.

5.2. AGEA
On January 28, 2004, AGEA issued USD 30.6
million aggregate principal amount Series C
Notes due 2014, which accrue interest at an
incremental fixed rate (2% from December 17,
2003 to January 28, 2008; 3% from
January 29, 2008 to January 28, 2012; and 4%
from January 29, 2012 to maturity), payable
semiannually.

Principal will be repaid in a lump sum on
January 28, 2014.

On January 26, 2006, AGEA issued Ps. 300
million aggregate principal amount Series D
Notes due 2014, which accrued interest at a
variable rate equal to the CER variation for the
period, plus a 4.25% margin, payable
semiannually commencing on June 15, 2006.
Principal was repaid in 8 equal and consecutive
semiannual installments beginning on June 15,
2008.

As of December 31, 2011 AGEA has repaid in
full principal under Series D Notes, plus interest
accrued thereon.

The Series C Notes due 2014 include certain
covenants and restrictions, including but not
limited to, restrictions on borrowings, creation
of encumbrances, mergers, disposition of
significant assets, transactions with affiliates
(including the Company) and payment of
dividends or other payments to shareholders
(including the payment of management fees to
the Company), if certain ratios are not met or if
certain amounts are exceeded.

Additionally, on July 15, 2011, AGEA executed
a syndicated loan agreement in the amount of
Ps. 45 million with Standard Bank Argentina
S.A. and Banco Itaú Argentina S.A., which
accrues interest at a fixed annual rate of 18.45%
payable on a quarterly basis as from October 18,
2011. Principal will be repaid in five
consecutive quarterly installments beginning on
July 18, 2012.

5.3. TRISA
As of December 31, 2010, TRISA is the
borrower under a loan with First Overseas Bank
Limited with an original principal amount of
USD 11,626,752, payable in 16 semiannual
installments, the first one of which was due on
June 28, 2004. Annual interest rate on the loan
is equal to Libor plus 3%. As of December 31,
2010, the outstanding balance amounted to Ps.
1.5 million. As of December 31, 2011, such
loan has been fully repaid.

5.4. GCSA Investments
As of December 31, 2011, GCSA Investments
is the borrower under a loan with JP Morgan
Chase Bank for a principal amount of USD 20
million, payable in two installments of USD 10
million each, due on December 30, 2012 and
June 30, 2013. Interest under the loan accrues
at a variable rate and is payable semiannually.
The loan agreement sets forth certain covenants
and restrictions, including mainly restrictions on
borrowings, creation of encumbrances, winding-
up, liquidation and effective changes of control.

5.5. ARTEAR
As of December 31, 2011, ARTEAR owed Ps.
20 million principal amount under a
commercial loan with a local bank. Principal on
the loan is payable in four equal installments
due in October 2012 and January, April and
July 2013. Interest accrues at a fixed rate and is
payable on a quarterly basis, starting in October
2011 until the final maturity.

5.6. Consolidated maturities
The following table summarizes the Company’s
consolidated financial debt maturities:

Without any

Current loans

Bank overdraft

Financial loans

Negotiable obligations

Acquisition of

equipment

Related parties

Interest and

restatements

established

term

760,399

888,888

Up to 3

months

46,552,309

20,498,726

8,970,621

114,292

-
1,649,287

85,731,671
161,867,619

To fall due

From 3 to 6

From 6 to 9

From 9 month

months

to 1 year

Total current

4,775,801

20,536,185

14,922,774

13,150,000

1,118,795
54,503,555

14,893,334

64,500,000

61,362,842

64,500,000

52,088,509

118,179,975

129,000,000

8,740,661

9,957,769

42,591,825

13,264,292

8,866
88,142,861

42,070
135,862,681

86,901,402
442,026,003

Non-current loans

years

Over 5 years

non-current

From 1 to 2

From 2 to 3

From 3 to 4

From 4 to 5

Total

To fall due

Financial loans

Negotiable obligations

102,971,183

231,125,000

6,364,288

669,677,222

22,958,155

382,222,222

2,869,468

1,747,997

136,911,091

727,619,723

573,333,333

2,583,977,500

Acquisition of

equipment
Related parties

Interest and

restatements

46,261,760
-

31,079,750
-

17,681,157
2,858,933

37,900

1,819,841

-
-

95,022,667
2,858,933

1,857,741

380,395,843

707,121,260

427,540,308

730,489,191

575,081,330

2,820,627,932

Note 6

Other borrowings
The following table summarizes the Company's
consolidated debt maturities in connection with
the acquisition of companies:

Without any

established

From 3 to 6

From 6 to 9

From 9 months

To fall due

Current sellers financing

term

Up to 3 months

months

to 1 year

Total current

Principal

1,723,486

3,253,526

3,540,190

243,526

9,004,254

Non-current sellers financing

Principal

Note 7

Derivatives
Under the consolidated item Other current
receivables, these financial statements included
as of December 31, 2010 Ps. 37.3 million of
receivables generated by the prepayment of
outstanding indebtedness held with financial
entities under swap agreements. Such
agreements consisted of interest rate and
exchange rate swaps, whereby the net position
resulting from swapping the obligation to pay
interest and principal at a variable rate in pesos
for the obligation to pay interest and principal
at a fixed rate in US dollars was transferred to
the financial entities that are party to such
agreements. The swap agreements were executed
in January 2006 and were effective until
December 2011.

During the last quarter of 2008, certain
amendments were executed to the swap

From 1 to

2 years

530,190

To fall due

From 2 to

Total

3 years

non-current

286,664

816,854

agreements, which involved the prepayment of
certain outstanding amounts denominated in
USD due in the years 2010 and 2011 in the
amount of USD 13.5 million.

Under Other Liabilities, these financial
statements include the amounts of foreign
currency forward transactions, which were
valued based on a nominal aggregate amount of
USD 30 million, for the purpose of mitigating
the adverse effects that future exchange rate
fluctuations may eventually have on foreign
currency liabilities and, therefore, on the
Company's financial position. These contracts
are due in February 2012, August 2012 and
February 2013.

The transactions related to derivatives generated
a net loss of Ps. 5.9 million for the year ended
December 31, 2011 and a net gain of Ps. 6.7
million for the year ended December 31, 2010
(see Note 14 to the parent company only
financial statements).

Note 8

Commitments and contingencies
8.1. Restrictions, surety and guarantees
a. Note 5 sets forth certain restrictions to which
Cablevisión (by itself and as the surviving
company and successor to Multicanal's
operations after the merger), PRIMA, AGEA
and IESA are subject under their respective
financial obligations described in such note.

b. All of TRISA's shares and 75% of Torneos y
Competencias S.A.'s (Uruguay) shares are
pledged as guarantee of the loan described in
Note 5.3.

IESA is subject to contractual restrictions on the
transfer of its equity interest in TRISA and Tele
Net Image Corp.

c. During the year 2009, AGR purchased a
binding machine on credit. To secure the
transaction, AGR granted the supplier a right of
pledge over the machine. AGR granted joint
and several guarantees for the loans granted by
Banco de Inversión y Comercio Exterior and
Standard Bank Argentina S.A. to Artes Gráficas
del Litoral S.A.

8.2. Regulatory Framework
a. Until the enactment of Audiovisual
Communication Services Law No. 26,522, the
exploitation of broadcasting services in
Argentina was governed by Broadcasting Law
No. 22,285. Under Law No. 22,285 cable
television companies in Argentina required a
non-exclusive license from the COMFER in
order to operate. Broadcasting licenses were
granted for an initial period of 15 years,
allowing for a one-time extension of 10 years.
The extension of the license was subject to the
approval of the COMFER who would
determine whether or not the licensee had met
the terms and conditions under which the
license had been granted. All of the Company's
subsidiaries that exploit broadcasting licenses
hold licenses granted by the COMFER under
such law. Some of the licenses held by the
Company's subsidiaries, including all the
broadcast TV licenses, the radio license for the
City of Buenos Aires, and the license originally
granted to Cablevisión S.A. have already been
extended for the above mentioned 10-year term.

On May 24, 2005, Decree 527/05 provided for
a 10-year-suspension of the terms then effective
of broadcasting licenses or their extensions.
Calculation of the terms shall be automatically
resumed upon expiration of the suspension
term, subject to certain conditions. The Decree
required that companies seeking to rely on the
extension submit for the COMFER's approval,
within two years of the date of the Decree,
programming proposals contributing to the
preservation of the national culture and the
education of the population and a technology
investment project to be implemented during
the suspension term. COMFER's Resolution
214/07 regulated the obligations established by
Decree 527/05 in order to benefit from such
suspension.

All the broadcasting services licensee subsidiaries
have submitted both projects in due time and
form. ARTEAR and its subsidiaries Telecor,
Telba and Bariloche TV, as well as Radio Mitre,
Cablevisión and the licensees merged into
Cablevisión, have obtained the COMFER's
approval of their respective projects (see Note
15 to the parent company only financial
statements and Note 11 to the consolidated
financial statements).

The Company's subsidiaries have requested the
COMFER's approval of several transactions,
including certain company reorganizations and
share transfers. The approvals of said
reorganization processes by the COMFER,
except for the Cablevisión-Multicanal merger
(see Note 8.2.c), are still pending as of the date
of these financial statements.

The activities of the Company's subsidiaries
concerning telecommunications services are
governed by National Telecommunications Law
No. 19,798 and by Decree 764/00, as amended
and supplemented. Such decree ordered the
deregulation of services and the opening of the
telecommunications market in Argentina.
Decree 764/00 approved the regulations that
make up the effective regulatory framework: the
Rules for Telecommunication Service Licenses,
the National Interconnection Rules, the General
Rules for Universal Services and the Rules for
the Administration, Management and Control
of the Radio Electric Spectrum.

The licensing regime is based on an Exclusive
Telecommunications License that allows the
licensee to render to the public any
telecommunication services, be they fixed or
mobile, wired or wireless, national or
international, with or without own
infrastructure.

Whatever their licenses, providers are required
to register each of the telecommunication
services to be rendered, without any limitation
whatsoever as to the number and combination
of services they may register. The following are
the Telecommunication Services registered
before the Argentine Secretariat of
Communications on behalf of the Company's
subsidiaries, merged companies and/or affiliates:
Data Transmission, Paging, Videoconference,
Community Signal, Signal Broadcasting, Added
Value, Trunking, Internet Access, Public
Telephony, Local Telephony, and National and
International Long-Distance Telephony.

SECOM acts as the Enforcement Authority of
the regulatory framework that governs the
rendering of telecommunication services. In
some cases, it acts together with the former
Antitrust and Consumer Defense Secretariat,
now the National Antitrust Commission
(CNDC) and the Consumer Defense
Secretariat, under the jurisdiction of the
Secretariat of Domestic Trade. The rendering of
telecommunication services is overseen by the
Argentine Communications Commission
(CNC), a decentralized agency regulated by
Decree 1185/90, as amended.

The General Rules for Universal Services
(“RGSU”, for its Spanish acronym) approved by
Decree 764/00, imposed the obligation on all
providers to contribute one per cent (1%) of the
total revenues accrued from telecommunication
services, net of applicable taxes and charges, to
the Universal Service Trust Fund (“FFSU”, for
its Spanish acronym). As a result, providers have
been required to make this contribution since
January 1, 2001. On November 30, 2010, a
trust agreement was executed to govern the
operation of the fund. The Company's
subsidiaries, as well as its merged companies
and/or affiliates, that render telecommunication
services have carried out the necessary
proceedings to comply with the obligation to

make contributions to the FFSU managed by
Banco Itaú Argentina S.A.

Finally, SECOM Resolution No. 9/2011 created
the “Infrastructure and Equipment” Program,
whereby telecommunication service providers
may submit projects aimed at developing new
infrastructure, updating the existing one and/or
acquiring equipment for areas not covered or
with unsatisfied needs, for the purposes of
fulfilling the obligation to make contributions
to the Universal Service Trust Fund for the
amounts accrued since January 2001 and until
Decree No. 558/08 came into effect. On June
21, 2011 the Company submitted projects
aimed at developing new infrastructure in
neighborhoods located in the cities of Posadas,
Resistencia and Corrientes.

b. Pursuant to the Antitrust Law and to
Broadcasting Law No. 22,285, the transactions
carried out on September 26, 2006 that resulted
in an increase in the indirect interest the
Company held in Cablevisión to 60%,
Cablevisión's acquisition of 98.5% of
Multicanal and 100% of Holding Teledigital
and Multicanal's acquisition of PRIMA (from
PRIMA Internacional (now CMD)) required
the authorization of the CNDC (validated by
the SCI), the COMFER and the SECOM. On
October 4, 2006, the Company, Vistone,
Fintech, VLG and Cablevisión, as purchasers,
and AMI CV Holdings LLC, AMI Cable
Holdings Ltd. and HMTF-LA Teledigital Cable
Partners LP, as sellers, filed for the approval of
the acquisition. After several requests for
information, the SCI issued Resolution No.
257/07, with a prior opinion of the CNDC in
favor of the approval of the above-mentioned
transactions and after consulting the COMFER
and the SECOM, which did not raise any
objections. The Company was served notice in
this respect on December 7, 2007. Such
Resolution was appealed by five entities. As of
the date of these financial statements, the
CNDC has dismissed the five appeals filed
against the above-mentioned resolution. Four of
the entities filed direct appeals before the
judicial branch. Three of such appeals were
dismissed and one is still pending resolution.

Cablevisión believes that, if the CNDC acts as it
did in the case of the three dismissed direct
appeals, this appeal is unlikely to be admitted.

On June 11, 2008, Cablevisión was served with
a decision of the Federal Commercial and Civil
Court of Appeals revoking a decision rendered
by the CNDC on September 13, 2007, whereby
such agency had dismissed a claim filed by
Gigacable S.A. prior to the December 7, 2007
decision referred to above. The Court of
Appeals revoked the CNDC's decision only
with respect to matters relating to the conduct
of Cablevisión and Multicanal prior to the
CNDC's authorization of the transactions on
December 7, 2007, and ordered an investigation
to determine whether a fine should be imposed
on Cablevisión and Multicanal due to such
conduct. As of the date of these financial
statements, Cablevisión has filed its response,
which is pending before such agency.

c. On December 15, 2008, Cablevisión's
shareholders approved the merger of Multicanal,
Delta Cable S.A., Holding Teledigital,
Teledigital, Televisora La Plata Sociedad
Anónima, Pampa TV S.A., Construred S.A. and
Cablepost S.A. into Cablevisión, whereby,
effective as of October 1, 2008, Cablevisión, in
its capacity as surviving company, became the
universal successor to all of the assets, rights and
obligations of the merged companies.

The merger commitment was executed on
February 12, 2009 and has been filed with the
CNV pursuant to applicable regulations that
require administrative approval. As of the date
of these financial statements, such merger is
pending administrative approval by the CNV
and registration with the IGJ.

On September 3, 2009, the COMFER issued
Resolution 577/09, whereby it withheld
approval of the Cablevisión-Multicanal merger
and required Cablevisión to submit a
conforming plan, holding that the
relinquishment of licenses spontaneously
reported by that Company to the COMFER
was insufficient in the locations where it held
multiple licenses.

On September 8, 2009, Multicanal was served
with Resolution No. 106/09 issued by the
CNDC on September 4, 2009, whereby the
CNDC ordered an audit to articulate and
harmonize the several aspects of Resolution No.
577/09 issued by the COMFER with

Resolution No. 257/07 issued by the Secretariat
of Domestic Trade. Resolution No. 106/09 also
sets forth that the notifying companies shall not,
from the enactment thereof and until the end of
the audit and / or resolution from the CNDC,
be able to remove or replace physical or legal
assets.

On September 17, 2009 Judge Dr. Esteban
Furnari from Federal Administrative Court in
Administrative Litigation Matters No. 2, in re
“Multicanal and Other v. Conadeco- Decree
527/05 and other on Proceeding leading to a
declaratory judgment”, ordered the suspension
of the effects of Resolution No. 577/09 issued
by the COMFER, of Resolution No. 106/09
issued by the CNDC, and other acts issued as a
result thereof, until a final decision was rendered
on these cases. The order was notified to the
CNDC, the CNV, the BCBA, Caja de Valores
S.A., the IGJ and all other public entities, state-
owned or not, in charge of carrying out
proceedings concerning the merger.

On October 23, 2009, the court decision
providing for the suspension of COMFER
Resolution No. 577/09 and CNDC Resolution
No. 106/09 was revoked by the Federal
Administrative Court of Appeals, Chamber No.
3 in re “Multicanal and Other v. Conadeco-
Decree 527/05 and other on Proceeding leading
to a declaratory judgment”. Therefore, the
calculation of the suspended terms was
automatically resumed. On that basis, on
December 1, 2009, Cablevisión ratified the
filing it had made with the COMFER at the
time of the merger, and specified the licenses to
which it had decided to maintain title. On
December 16, 2009, the Federal Administrative
Court of Appeals, Chamber No. 3 in re
"Multicanal and other v. Conadeco Decree
527/05 and other on Proceeding leading to a
declaratory judgment" File No. 14,024/08,
granted the appeal filed by Multicanal and
Grupo Clarín against the decision rendered by
that same court on October 23, 2009. With the
granting of that appeal, Cablevisión's
preliminary injunction regained full force and
effect. Accordingly, on January 8, 2010
Cablevisión notified the COMFER in this
regard.

Subsequently, on March 9, 2011, the Supreme
Court of Argentina in re “Multicanal and Other
v./ Conadeco - Decree 527/05 and other on
Proceeding leading to a declaratory judgment”,
granted the appeal by application and the appeal
by right filed before the Supreme Court by the
National Government against the decision
rendered by the Federal Administrative Court of
Appeals, Chamber No. 3, that affirmed the
preliminary injunction requested by Cablevisión
in the first instance, revoking it.
Notwithstanding the foregoing, Cablevisión
believes that this matter does not have a
material impact on the substantive issues.

Notwithstanding the filings made by
Cablevisión and its shareholders as required by
the CNDC to prove compliance with the
commitment agreed with the CNDC on
December 7, 2007 (date on which the SCI
granted authorization); on September 23, 2009,
the SCI issued Resolution No. 641 whereby it
ordered the CNDC to verify compliance with
the parties' proposed commitment by visiting
the parties' premises, requesting reports,
reviewing documents and information and
carrying out hearings, among other things.

On December 11, 2009, Cablevisión notified
the CNDC of the completion and
corresponding verification of the fulfillment of
the voluntary undertakings made by Cablevisión
at the time of the enactment of SCI Resolution
No. 257/07, which had approved the
acquisitions notified by the Company at that
time. On December 15, 2009, the Federal
Commercial and Civil Court of Appeals,
Chamber No. 2, issued a preliminary injunction
in re “Grupo Clarín S.A. v. Secretariat of
Domestic Trade and other on preliminary
injunctions” (case 10,506/09), partially
acknowledging the preliminary injunction
Grupo Clarín requested, and instructing the
CNDC and the SCI to notify Grupo Clarín
whenever their own verification of Cablevisión's
fulfillment of its undertakings had been
concluded, regardless of their result. Should
such agencies have any observations, they
should notify Grupo Clarín within a term of 10
days. On the same date, the CNDC issued
Resolution No. 1011/09 whereby it deemed
Cablevisión's voluntary undertakings unfulfilled
and declared the rescission of the authorization
granted under Resolution 257/07.

On December 17, 2009, the Federal Court of
Appeals in Commercial-Criminal Matters,
Chamber A, decided to suspend the term to
appeal Resolution No. 1011/09 until the main
case was transferred back to the CNDC,
considering it had been in such court since
December 16, 2009.

On December 17, 2009, the CNDC notified
Cablevisión of the initiation of the motion for
execution of Resolution No. 1011/09. On
December 18, 2009 the Federal Commercial
and Civil Court of Appeals, Chamber No. 2,
issued a preliminary injunction in re “Grupo
Clarín S.A. v. Secretariat of Domestic Trade and
other on preliminary injunctions”, which
suspended the effects of Resolution No.
1011/09 until the notice set forth in the
preliminary injunction of December 15, 2009
was served. Accordingly, the CNDC served
notice to Cablevisión by means of Resolution
No. 1101/09.

On December 30, 2009, the Federal
Commercial and Civil Court of Appeals,
Chamber No. 2, issued a preliminary injunction
in re “Grupo Clarín S.A. v. Secretariat of
Domestic Trade and other on preliminary
injunctions”, partially acknowledging Grupo
Clarín's request and suspending the term for
Grupo Clarín to respond to Resolution No.
1101/09 until Grupo Clarín is granted access to
the administrative proceedings related to the
charges brought by the CNDC in its Opinion
No. 770/09 (on which Resolution 1011/09 was
based).

On February 19, 2010, Cablevisión requested
the nullification of the notice, and as a default
argument, submitted the response requested
under Resolution No. 1101/09. On February
26, the Federal Court of Appeals in
Commercial-Criminal Matters approved the
recusation filed by Cablevisión and excluded the
Secretary of Domestic Trade from the
proceedings.

On March 3, 2010, the Argentine Ministry of
Economy and Public Finance issued Resolution
No. 113 (subscribed by the Minister of
Economy, Dr. Amado Boudou) rejecting the
request for the nullification of Resolution No
1011/09, the request for abstention and
excusation of certain officials, and all the

evidence produced in connection with such
request for nullification. The voluntary
undertakings made by Cablevisión at the time
of Resolution 257/07 were deemed unfulfilled,
thus declaring the rescission of the authorization
granted under such resolution. The parties
involved were ordered to take all necessary
actions within a term of six months to comply
with such rescission and inform the CNDC
about the progress made on a monthly basis.
Such resolution was appealed in due time and
form. The appeal was granted without staying
the execution of judgment. Such appeal is
currently pending before Chamber II of the
Federal Civil and Commercial Court of Appeals
in re “AMI CABLE HOLDING and other on/
Appeal of the National Antitrust Commission
Resolution” (File 2054/2010).

On March 3, 2010, an action was brought
seeking the nullification of COMFER
Resolution No. 577/09. Upon being served with
this action, COMFER filed an exception, which
was responded by Cablevisión.

On April 20, 2010 the Federal Commercial and
Civil Court of Appeals, Chamber No. 2,
granted the appeal by right filed by Grupo
Clarín S.A. in re “Grupo Clarín on delay in the
remittance of the proceedings”, and decided that
the appeal granted by the CNDC to the
Company against Resolution No. 113/10 had
the effect of staying such resolution.

The National Government filed an appeal
asking that the Court of Appeals revoke its own
decisions with respect to the effect granted to
the April 20 decision, and that it decline its
jurisdiction. It also filed an extraordinary
appeal. Both appeals were dismissed. Chamber
No. 2 requested the administrative file and the
Court's decision is pending. Cablevisión
considers that it has strong grounds to have the
effects of the above Resolution suspended and
therefore has brought the relevant legal actions.
However, it cannot assure that the outcome will
be favorable.

Decisions made on the basis of these financial
statements should consider the eventual impact
that the above-mentioned resolutions might
have on the Company's subsidiary Cablevisión,
and these financial statements should be read in
light of such uncertainty.

d. Cablevisión, by itself and as successor of
Multicanal's operations after the merger, is a
party to several administrative proceedings
under the Antitrust Law, facing charges of
anticompetitive conduct, including territorial
division of markets, price discrimination, abuse
of dominant position, refusal to deal and
predatory pricing, as well as a proceeding filed
by the Cámara de Cableoperadores
Independientes (Chamber of Independent Cable
Operators), challenging the transactions
consummated on September 26, 2006. While
Cablevisión believes that its conduct and that of
Multicanal have always been within the bounds
of the Argentine Antitrust Law and regulations
and that their positions in each of these
proceedings are reasonably grounded, it can give
no assurance that any of these cases will be
resolved against it.

e. On July 16, 2010, the SCI notified
Cablevisión and Multicanal of the content of
Resolution 219/2010, whereby the Secretary of
Domestic Trade decided to declare both
companies responsible for having agreed to
divide among themselves the pay television
market of the City of Santa Fe; imposing a joint
fine of Ps. 2.5 million to each company. On
July 26, 2010, Cablevisión and Multicanal
appealed the resolution, presenting new
arguments in connection with the application of
statutes of limitation, which had already been
alleged prior to the issuance of the appealed
resolution.

On March 1, 2011, the SCI notified
Cablevisión and Multicanal of the content of
Resolution No. 19/2010, whereby the Secretary
of Domestic Trade decided to declare
Cablevisión and Multicanal liable for having
agreed to divide among themselves the pay
television market of the City of Paraná;
imposing a joint and several fine of Ps. 2.5
million to each company. Cablevisión has filed
an appeal in due time and form. Such appeal
was rejected by the Federal Court of Appeals of
Paraná. Cablevisión filed an appeal with the
Supreme Court of Argentina. On November 4,
2011, the appeal filed by Cablevisión with the
Supreme Court of Argentina regarding SCI
Resolution No. 19/2010 was partially granted
by the Federal Court of Appeals of Paraná.

While Cablevisión believes that its conduct and
that of Multicanal have always been within the
bounds of the Argentine Antitrust Law and
regulations and that their positions in each of
these proceedings are reasonably grounded, it
can give no assurance that any of these cases will
be resolved in its favor.

f. On January 22, 2010, Cablevisión was
notified of CNDC Resolution No. 8/10 issued
within the framework of file No. 0021390/2010
entitled “Official Investigation of Cable
Television Subscriptions (C1321)”. By means of
such Resolution, Cablevisión and other
companies were ordered to refrain from
conducting collusive practices and, particularly,
from increasing the price of cable television
subscriptions for a term of 60 days, counted as
from the date all required notices are certified as
completed. According to said Resolution,
companies which have already increased the
price of the subscriptions shall return to the
price applicable in November 2009 and
maintain such price for the abovementioned
term.

On February 2, 2010, by means of Resolution
No. 13/10, the CNDC ordered Cablevisión to
credit its subscribers the amount of any price
increase made after the date of CNDC
Resolution No. 8/10 on its March invoices.

Both resolutions were appealed in due time and
form and their effects were suspended by a
preliminary injunction granted by the Federal
Commercial and Civil Court of Appeals,
Chamber No. 2, at Cablevisión's request.

Finally, on October 4, 2011, the same Chamber
granted the appeal, declaring that the claim
based on CNDC Resolution No. 8/10 was
moot and nullifying CNDC Resolution No.
13/10.

The National Government appealed such
decision before the Supreme Court of
Argentina, which shall grant or dismiss the
appeal.

g. On March 3, 2010, the SCI issued
Resolution No. 50/2010, whereby it approved
certain rules for the sale of cable television
services. These rules provide that cable television
operators must apply a formula to estimate the

monthly subscription prices. The price arising
from the application of the formula must be
informed to the Office of Business Loyalty
(Dirección de Lealtad Comercial) between
March 8 and March 22, 2010. Cable television
operators shall adjust such amount every six
month and inform the result of such adjustment
to said Office. Such formula, which the SCI
seeks to impose as mandatory, is illegitimate,
inconsistent with industry parameters, and
flagrantly disregards constitutional rights.

Even though as of the date of these financial
statements Cablevisión cannot assure the actual
impact of the application of this formula, given
the vagueness of the variables provided by the
Resolution to calculate the monthly
subscription prices, Cablevisión believes
Resolution No. 50/10 is arbitrary and bluntly
disregards freedom to contract, which is part of
the freedom of industry and trade. Therefore, it
has filed the pertinent administrative claims and
will bring the necessary legal actions requesting
the suspension of the Resolution's effects and
ultimately requesting its nullification.

Even though Cablevisión, like other companies
in the industry, have strong constitutional
arguments to support their position, it cannot
be assured that the final outcome of this issue
will be favorable. Therefore, Cablevisión may be
forced to modify the price of its cable television
subscription, a situation that could significantly
affect the revenues of its core business. This
situation creates a general framework of
uncertainty over the Cablevisión's business,
which may significantly affect the recoverability
of its significant assets. Notwithstanding the
foregoing, as of the date of these financial
statements, in accordance with the decision
rendered on August 1, 2011 in re "LA
CAPITAL CABLE S.A. v/ Ministry of
Economy-Secretary of Domestic Trade", the
Federal Court of Appeals of Mar del Plata has
ordered the SCI to suspend the application of
Resolution No. 50/2010 with respect to all
cable television licensees represented by the
Argentine Cable Television Association (ATVC,
for its Spanish acronym). Such decision was
served on the SCI and the Ministry of Economy
on September 12, 2011, thereby becoming fully
effective. Consequently, the SCI may not
disregard it.

On June 1, 2010, the SCI imposed a Ps. 5
million fine on Cablevisión because it failed to
comply with the information regime set forth
by Resolution No. 50/2010, invoking the
Antitrust Law to impose such penalty. The fine
was appealed and submitted to the Federal
Administrative Court of Appeals, Chamber V,
which decided to reduce the fine to Ps.
300,000. Cablevisión appealed this decision by
filing an extraordinary appeal with the Supreme
Court of Argentina.

On March 10, 2011 SCI Resolution No.
36/2011 was published in the Official Gazette.
This Resolution follows the guidelines of SCI
Resolution 50/2010. Resolution No. 36/2011
sets forth the parameters to be applied to the
services rendered by Cablevisión to its
subscribers from January through April, 2011.
These parameters are as follows: 1) the monthly
basic subscription price shall be Ps. 109 for this
period; 2) the price of other services currently
rendered by Cablevisión shall remain unchanged
as of the date of publication of this resolution;
3) as to the promotional benefits, existing
rebates and/or discounts, the company shall
maintain those already granted as of that same
date. As mentioned in this resolution,
Cablevisión shall reimburse the users for any
amount collected above the price set for this
period.

In connection with the above, Cablevisión
believes that this resolution is illegal and
arbitrary since it is grounded on Resolution
50/2010, which is absolutely null and void.
Accordingly, Cablevisión requested the
suspension of the effects of that Resolution and
Resolution No. 50/2010.

Such request was resolved in Cablevisión's favor
in re "CABLEVISION S.A. v/ National
Government (Secretariat of Domestic Trade -
Ministry of Economy and Public Finance) on/
Preliminary Injunction" (file No. 6-C-11)
pending before Federal Court No. 1 of the City
of Córdoba. The court suspended the effects of
Resolutions No. 50/10 and 36/2011 with
respect to CABLEVISION S.A., its branches
and subsidiaries, ordering the Secretariat of
Domestic Trade and the Ministry of Economy
to refrain from executing and/or enforcing such
resolutions. The injunction was appealed by the
National Government and the Federal Court of

Appeals of the City of Córdoba declared that it
lacked territorial jurisdiction.

The case has been transferred to Federal
Administrative Court No. 7, under Judge
Cristina Carrión de Lorenzo. Cristina Carrión
de Lorenzo declared that she lacked subject
matter jurisdiction, and that the case should be
heard by an economic criminal court. Such
declaration was appealed by the National
Government. Chamber IV of the Federal
Administrative Court of Appeals decided that it
had jurisdiction over this proceeding and
revoked the injunction that had been effective
up to that moment.

Notwithstanding the foregoing, an ordinary
proceeding is currently pending before Federal
Administrative Court No. 7 seeking the
nullification of Resolution No. 50/2010.

On April 25, 2011, by virtue of a preliminary
injunction requested by Mr. Gustavo Traverso
(user of cable television services), the Federal
Court of Junín ordered Cablevisión to rebill the
service to this user for Ps.109, to reimburse any
amount collected exceeding such amount in
connection with such service and to refrain
from interrupting or modifying the service until
the court rules on the merits pursuant to
Resolutions No. 50/2010 and 36/2011.
Subsequently, since Cablevisión believes that the
application of such Resolutions has been
suspended with respect to such company, its
branches and subsidiaries, on May 4, 2011
Cablevisión requested the reversal of such
injunction and filed a subsidiary appeal.

On May 2, 2011 the SCI issued Resolution No.
65/2011 extending the effectiveness of
Resolution No. 36/2011 for two months (May
and June 2011). On June 30, 2011, the SCI
issued Resolution No. 92/2011 extending the
effectiveness of such resolution for the months
of July and August, 2011. Additionally, on
August 31, 2011 the SCI issued Resolution No.
123/2011 setting the price of the cable
television subscription at Ps. 116 and extending
such effectiveness for two additional months
(September and October, 2011). On October
31, 2011, the SCI issued Resolution No.
141/2011 extending such effectiveness for two
additional months (November and December,
2011). Finally, on December 29, 2011 the

Secretariat of Domestic Trade issued Resolution
No. 10/2011 extending such term for another
three months (January, February and March
2012). Cablevisión believes, however, that given
the terms under which the Federal Court No. 1
of the City of Córdoba granted the preliminary
injunction, that is, ordering the SCI and the
Ministry of Economy to refrain from executing
and/or enforcing Resolutions No. 50/2010 and
36/2011, and also given the fact that
Resolutions No. 65/2011, 92/2011 and
123/2011 merely extend the effectiveness of the
latter, Cablevisión will continue to be protected
by said preliminary injunction, and, therefore,
its ordinary course of business will not be
affected.

On October 28, 2011 Cablevisión was served
with a preliminary injunction issued by the
Federal Court of San Nicolás, ordering that
company to stop charging Ps. 143 for the
monthly fee, as provided under Resolution
50/2010. Cablevisión filed an appeal against
such injunction in due time and form. See Note
14.b.

On July 14, 2011, in re “Asociación de
Consumidores de Vicente López v./ Cablevisión
S.A. on/ specially expedited summary
proceeding” - which is pending before the
Federal Court of First Instance in Civil,
Commercial and Administrative Litigation
Matters No.1 of San Martín, Clerk's Office No.
3 - Cablevisión was served notice of an order to
readjust the July and August monthly cable
television subscription fee payable by the users
domiciled in Vicente López to Ps. 109. Pursuant
to the court's decision, subscribers who have
already paid their July bills should have all
amounts paid in excess deducted from their
August bills. Cablevisión filed an appeal in due
time and form because it believes that the
application of Resolutions No. 50/2010 and
36/2011 has been suspended by way of a
preliminary injunction with respect to such
company, its branches and subsidiaries. Such
appeal is still pending resolution.

On July 18, 2011, Cablevisión was served
notice of a collective injunction issued on June
24, 2011 by the Consumer and User Defense
Administration of the City of Quilmes pursuant
to Law No. 13,133. Such Administration
ordered Cablevisión to cease immediately to

charge and/or require payment of a basic
subscription fee of more than Ps. 109 for its
paid television services with respect to all users
domiciled in Quilmes, regardless of the
mechanism and amounts provided under
Resolutions No. 50/2010, 36/2011 and
65/2011 issued by the SCI, or under any future
resolution that may amend or replace them. The
injunction also orders Cablevisión to refrain
from altering the service conditions and to
provide the means to secure the refund of any
amount paid by the users in excess of Ps. 109.
On July 28, 2011, Cablevisión requested the
reversal of the injunction. In both cases,
Cablevisión filed a subsidiary appeal, expressly
requesting the suspension of the effects of the
injunction, based on the fact that the
application of Resolutions No. 50/2010 and
36/2011 has been provisionally suspended.

h. On August 5, 2010, Cablevisión was served
with CNC Resolution No. 2936/2010 within
the framework of Administrative Proceeding
File No. 2,940/2010, pursuant to which
Cablevisión and/or any other individual or
entity through which the services relating to the
licenses and registrations granted to FIBERTEL
S.A. ("Fibertel") may be rendered shall refrain
from adding new subscribers and from altering
the conditions under which the services are
currently rendered.

To decide as it did, the Argentine
Communications Commission disregarded the
corporate reorganization that was completed
and registered before the IGJ, whereby Fibertel
merged into Cablevisión effective as of April 1,
2003. By virtue of the merger, Cablevisión
became the successor to all of the assets, rights
and obligations of Fibertel as merged company,
including the Exclusive License granted under
SECOM Resolutions No. 100/96, 2375/97,
168/02 and 83/03. Therefore, Fibertel did not
transfer or divest of its rights and obligations to
third parties - among them, those derived from
the above-mentioned Exclusive License. Fibertel
continued to carry out its activities through
Cablevisión as surviving company. In order to
implement the above-mentioned corporate
business reorganization, on March 5, 2003, the
Argentine Communications Commission and
the SECOM were notified of the corporate
business reorganization for its

acknowledgement. The technical and legal areas
of the Argentine Communications Commission
issued a favorable resolution with respect to the
compliance with the requirements of current
regulations to register Fibertel's license under
the name of Cablevisión. SECOM had a term
of 60 days to decide on the corporate business
reorganization. However, such agency failed to
render a decision as required by the applicable
regulations. Not until August 19, 2010 did
SECOM issue Resolution No. 100/2010,
revoking Fibertel's license.

Cablevisión believes that the Resolution is
arbitrary and that it flagrantly violates due
process and its defense right. Therefore,
Cablevisión has appealed such resolution. The
appeal is still pending as of the date of these
financial statements.

i. On August 19, 2010 the Media Secretariat
issued Resolution No. 100/2010, whereby it
revoked the license that had been granted to
Fibertel. The Company believes that this
Resolution is an absolutely null and void
administrative act, which may not be cured,
because it presents evident defects in its
enactment procedure and with respect to
jurisdiction, purpose, reasonableness, subject
matter and cause. Its wording contradicts
express provisions of the National Constitution,
of Law No 19,550 (Argentine Business
Associations Law), Decrees 1185/90 and 764/00
and Law No. 19,549 of Administrative
Procedures, among others. The Resolution
disregards the several filings made by
Cablevisión with the Media Secretariat
requesting such agency to issue an
administrative act evidencing that Cablevisión
S.A., pursuant to section 82 of the Argentine
Business Associations Law, is the successor of
Fibertel and, therefore, the holder of the
exclusive telecommunication service license and
of the registrations that had been previously
granted to Fibertel. More than eight years after
that request, in spite of the existence of a draft
of a favorable decision in the case file, with a
completely arbitrary attitude that contradicts
other precedents of the same agency, and
without prior notice that would have allowed
Cablevisión to exercise its defense right, the
SECOM ordered that the license be revoked
and that the users migrate within 90 days of the
resolution's notification. On August 26, 2010

Cablevisión filed an appeal requesting the
reversal of the resolutions, and if such appeal is
rejected, a subsidiary appeal against that
Resolution before the highest administrative
authority. The scope of the appeal was extended
on September 7, 2010. The appeal was
dismissed pursuant to SECOM Resolution No.
132/2010 dated October 7, 2010. However,
since Cablevisión had filed a subsidiary appeal
to have the case heard by the highest
administrative authority; the file was submitted
to the Ministry of Federal Planning, Public
Investment and Utilities. As of the date of these
financial statements, this appeal is pending
resolution.

On December 22, 2010 the Federal Court of
First Instance No. 1 of Córdoba in re “Soutullo,
Torres María Florencia and others v. Cablevisión
and others on Declaratory Judgment Action -
File No. C/103-S-10”, decided to: 1) issue an
injunction to maintain the current legal and
factual conditions under which Cablevisión
provides and markets telecommunication,
Internet and television services under the brands
“FIBERTEL” and “CABLEVISIÓN”; 2)
suspend the application and execution of Secom
Resolution No. 100/2010 issued on August 19,
2010. Pursuant to the Federal Court's decision,
the Secom shall refrain, itself and/or through
any of its bodies and/or agencies, from
disrupting the effective exploitation of the
Exclusive Telecommunications License currently
held by “CABLEVISIÓN” under the brand
“FIBERTEL”. Such license includes the
commercialization of data transmission, paging,
videoconference, community signal, signal
broadcasting, added value, trunking, local
telephony and public telephony services. The
Federal Court's decision includes the suspension
by the Audiovisual Communication Services
Law Federal Enforcement Authority, with
respect to Cablevisión and its subsidiaries, of the
application of section 50, sub-section
“Continuity of Service”, Schedule I of Decree
No. 1225/10; 3) take into account that under
the network structure and modality of Internet
and pay television services rendered by
Cablevisión, the injunction considers the
nationwide integration of the system. Notice of
the injunction was served on the National
Government - Argentine Media Secretariat
(SECOM), Audiovisual Communication
Services Law Federal Enforcement Authority

(AFSCA), the Argentine Communications
Commission (CNC), and any other national,
provincial or municipal body, so that they may
refrain from preventing, hindering and/or
hampering in any way the effective provision
and commercialization of the services rendered
by “CABLEVISIÓN” and/or “FIBERTEL”. On
July 21, 2011, the Federal Court of Appeals of
Cordoba, Chamber A, revoked such preliminary
injunction. Cablevisión filed an appeal with the
Supreme Court of Argentina against this
decision, but it was dismissed.

On February 24, 2011, the Federal Commercial
and Civil Court of the City of Buenos Aires,
Chamber No. 3, in re “ANTITRUST
ASSOCIATION V. NATIONAL
GOVERNMENT MEDIA SECRETARIAT
ON COMPLAINT FOR THE
PROTECTION OF CONSTITUTIONAL
RIGHTS” confirmed the decision rendered in
the first instance, stating that the National
Government, Media Secretariat, shall refrain
from disrupting or limiting in any way the
rendering of Internet access services offered by
Cablevisión. It also partially changed the above
decision by broadening its effects, ordering the
National Government to refrain from enforcing
Resolution No. 100/2010, thus allowing new
customers to subscribe to the Internet access
services offered by Cablevisión.

On December 16, 2011, Federal Commercial
and Civil Court No. 3, Clerk's Office No. 5
issued a related injunction in re
“CABLEVISION S.A. v. NATIONAL
GOVERNMENT ON COMPLAINT FOR
THE PROTECTION OF
CONSTITUTIONAL RIGHTS”, ordering the
suspension of the effects of SECOM Resolution
No. 100/2010 and also guaranteeing new
subscribers the possibility to subscribe to the
Internet Access service offered by Cablevisión.

Therefore, Cablevisión is authorized to continue
to render the telecommunication services
granted to Fibertel.

Cablevisión will resort to all available
administrative and judicial remedies available in
order to have SECOM Resolution No.
100/2010 declared null and void. Even though
Cablevisión has strong grounds that support its
position, it cannot be assured that the final
outcome of this issue will be favorable.

There are currently more than ten pending
summary proceedings to protect constitutional
guarantees brought by consumers and/or
consumer associations demanding that
Cablevisión continue to render the Internet
service as it has done to date, and requesting
that SECOM Resolution No. 100/2010 be
declared unconstitutional. As of the date of
these financial statements, two of these
proceedings have been dismissed and the rest
has not been decided upon yet.

On December 20, 2011, at the request of
Cablevisión, a new preliminary injunction was
issued in re “CABLEVISION S.A. v. National
Government - Argentine Secretariat of
Communications on COMPLAINT FOR THE
PROTECTION OF CONSTITUTIONAL
RIGHTS”. On the basis of the above-
mentioned precedent, and on the existing
connection between the subject matters of both
cases, as alleged by Cablevisión, the injunction
ordered the suspension of the effects of
SECOM Resolution No. 100/10.

j. On September 10, 2010, the National
Administration of Domestic Trade notified
Cablevisión that a Ps. 5 million fine had been
imposed for promoting the Fibertel service
without being the holder of the license (section
7 of Law 24,240), consequently providing
wrong information to the client (section 4 of
Law 24,240) and for the impossibility of
honoring the promotion by reason of not being
the holder of Fibertel's license (section 19 of
Law 24,240). Cablevisión has appealed that
decision because it considers that there are
sufficient arguments in favor of its position. The
file was assigned No. 1276 and is pending
before Chamber II of the Federal Administrative
Court of Appeals. However, Cablevisión cannot
assure that the outcome of the appeal will be
favorable.

k. On October 21, 2010, Cablevisión was
served notice of a resolution from the National
Administration of Domestic Trade, whereby (i)
a Ps. 5 million fine was imposed for failure to
comply with reporting obligations (section 41 of
Law 24,240) on one of its promotional
campaigns and (ii) a Ps. 500 thousand fine for
failing to comply with Decree 1153/95 Section
2, c) of the regulations to Section 10 of Law
22,802. Cablevisión has appealed the fines

because it believes it has strong arguments in
favor of its position. The file was assigned No.
1281 and is pending before Chamber II of the
Federal Administrative Court of Appeals. On
October 4, 2011, the Chamber partially
affirmed Resolution 739/10 and reduced the
amount of the fine to Ps. 2.2 million, imposing
75% of the legal costs on Cablevisión. On
October 13, 2011 Cablevisión filed a federal
ordinary appeal, and on October 20, 2011 it
filed a federal extraordinary appeal to have the
case heard by the Supreme Court of Argentina
in the event that the federal ordinary appeal
may be dismissed. However, Cablevisión cannot
assure that the outcome of the appeal will be
favorable.

l. On October 28, 2010, Cablevisión was served
notice of the National Administration of
Domestic Trade's resolutions imposing two fines
of Ps. 5 million each, for allegedly failing to
observe the typographic character requirements
under applicable regulations (Resolution
906/98) when informing its subscribers of the
increase in the price of their cable television
subscriptions. On November 12, 2010
Cablevisión appealed these fines because it
believes it has strong arguments in favor of its
position. However, it cannot be assured that the
outcome of the appeals will be favorable. One of
the files was assigned No. 1280 and is pending
before Chamber I of the Federal Administrative
Court of Appeals, and the other one was
assigned No. 1278 and is pending before
Chamber V of the Federal Administrative Court
of Appeals.

m. On May 23, 2011, Supercanal S.A. filed a
claim for the protection of constitutional rights
(acción de amparo) before the Federal Court of
Mendoza against Cablevisión, Grupo Clarín and
other co-defendants, requesting that they refrain
from exercising alleged anti-competitive
practices and that the assets, liabilities and
businesses that used to belong to Multicanal and
that were subsequently merged into Cablevisión
(see Note 8.2.c) be separated from the other
assets, liabilities and businesses of Cablevisión
and transferred to third parties.

Together with the claim for the protection of
constitutional rights, Supercanal requested a
preliminary injunction - for the same purposes -
which was granted on December 16, 2011. The

injunction orders the separation of the assets,
liabilities and businesses that used to belong to
Multicanal and that were subsequently merged
into Cablevisión within a term of 60 days. It
also appoints, for a term of twelve months, a
court-appointed supervisor (interventor) and co-
administrator who shall enforce the injunction,
order the changes to such company's
management required for the effective
enforcement of the duties to be fulfilled by the
Board of Directors, and also report on a
monthly basis to the court about his/her
performance. Such court-appointed supervisor
(interventor) and co-administrator shall have the
obligation to conduct the necessary actions
aimed at fulfilling the actions ordered pursuant
to the injunction.

Cablevisión filed an appeal against such
injunction and presented the grounds for its
defense. Such appeal is still pending resolution.

Cablevisión also requested the replacement of
this injunction with a less burdensome one that
could largely cover the risks alleged by
Supercanal in its claim. The judge hearing the
case has not yet decided upon this request.

Cablevisión believes that it has strong grounds
for the judge to revoke the preliminary
injunction and to decide that the Federal Court
of Mendoza lacks jurisdiction given that the
company does not operate in that province. In
spite of this, Cablevisión cannot assure the
outcome of the appeals.

8.3. Other regulatory matters
a. The litigation brought before the Civil,
Commercial, Mining and Labor Court of the
City of Concarán, Province of San Luis, in early
2007 in re “Grupo Radio Noticias SRL v.
CableVisión and others”, is still pending before
the Federal Court in Administrative Litigation
Matters No. 2.

The purpose of that claim was to challenge the
share transfers mentioned in Note 8.2.b. and to
request the revocation of Cablevisión's
broadcasting licenses. Cablevisión has responded
to such claim and believes it is very unlikely that
it will be admitted.

b. The Government of the City of Mar del Plata
enacted Ordinance No. 9163, governing the

100 101

installation of cable television networks. Such
ordinance was amended and restated by
Ordinance No. 15981 dated February 26, 2004,
giving cable companies until December 31,
2007 to adapt their cable networks to the new
municipal requirements. The ordinance sets
forth that in those areas where street lighting
has underground wiring, cable television
networks are to be placed underground. In this
sense, the Executive Department of the
Municipality of General Pueyrredón has
submitted to the Municipal Council a proposed
ordinance extending the term provided until
December 31, 2015. Such ordinance is ready for
discussion by legislators. Even though the
ordinance provides for certain penalties that
may be imposed, the City has not imposed such
penalties to cable systems that are not in
compliance with such ordinance.

c. On July 13, 2011 Uruguay's Executive
Branch issued Decree No. 231/2011 revoking
some of the broadcasting frequencies previously
granted in 1993, 1994 and 2005 to two
companies with which a subsidiary of
Cablevisión has executed agreements. These
frequencies are currently used by such
companies to render digital and high-definition
cable television services to subscribers. Such
Decree awards both companies a lower number
of new broadcasting frequencies accounting for
a smaller portion of the radio electric spectrum.
These changes in the award of frequencies, as
established by such decree, shall be effective 18
months after the date on which the decree came
into effect (December 13, 2012).

On July 22, 2011, the two companies filed an
appeal requesting that such decree be revoked.
Since the administration has not rendered any
decision on the appeal within 150 days of the
date on which the appeal was filed,
administrative remedies are deemed exhausted.
Therefore, the companies are entitled to bring a
judicial claim requesting nullification of the
decree before the Administrative Court, together
with the request for the suspension of such
decree.

8.4. Claims brought by the COMFER (now
AFSCA)
Cablevisión
As from November 1, 2002 and until December

31, 2011, the COMFER and AFSCA initiated
summary administrative proceedings against
Cablevisión and Multicanal (merged into
Cablevisión) for infringements of regulations
regarding the content of programming.
Accordingly, a provision has been set up in this
regard.

ARTEAR
As of December 31, 2011, Artear recorded a
provision in the amount of approximately Ps.
7.4 million for fines imposed by the COMFER
and AFSCA under the new penalties regime
currently in effect, some of which have been
appealed and are pending resolution.

8.5. Lawsuits and /or Claims
Cablevisión
On December 12, 2001, Supercanal filed a
claim against Multicanal for damages as a result
of the enforcement of a preliminary injunction
brought by Multicanal against Supercanal.
Multicanal responded to such claim denying
any liability. Based on de jure and de facto
records of the case, Cablevisión, as successor of
Multicanal's operations, believes that the claim
filed should be rejected in its entirety, and the
legal costs should be borne by the plaintiff. As
of the date of these financial statements, the
proceeding is at the discovery stage. The court
of first instance dismissed Supercanal's request
that it be allowed to sue without paying court
fees or costs. This decision was ratified by the
Federal Court of Appeals.

CIMECO
The AFIP served CIMECO with a notice
challenging its income tax assessment for the
fiscal periods 2000, 2001 and 2002. In such
notice, the AFIP challenged mainly the
deduction of interest and exchange differences
in the tax returns filed for those years. If AFIP's
position prevails, CIMECO's contingency as of
December 31, 2011 would amount to
approximately Ps. 12.3 million principal
amount and Ps. 20.8 million interest.

CIMECO filed a response, which was dismissed
by the tax authorities. The tax authorities issued
their own official assessment and imposed
penalties. CIMECO appealed the tax
authorities' resolution before the National Tax
Court on August 15, 2007.

During the year ended December 31, 2010,
CIMECO received a pro forma income tax
assessment from the AFIP for fiscal periods
2003 through 2007, as a consequence of AFIP's
challenge to CIMECO's income tax assessments
for the periods 2000 through 2002 mentioned
above. CIMECO filed a response before AFIP,
rejecting such assessment and requesting the
suspension of administrative proceedings until
the Federal Tax Court renders its decision on
the merits.

During this year, the AFIP served CIMECO
with a notice stating the income tax charges
assessed for the periods 2003 through 2007 and
ordering the initiation of summary proceedings.
The AFIP's assessment shows a difference in the
Income Tax liability for the above indicated
periods in its favor for an amount in excess of
the amount that had been estimated originally,
as a result of the method used to calculate
certain deductions. CIMECO responded to the
assessment rejecting all of the adjustments and
requesting that the proceedings be rendered
without effect and filed, with no further actions
to be taken. As of the date of these financial
statements, CIMECO has not received a
response from the tax authorities.

CIMECO and its legal and tax advisors believe
CIMECO has strong grounds to defend its
position and that AFIP's challenges will not be
admitted by the Federal Tax Court. Accordingly,
CIMECO has not booked an allowance in
connection with the effects such challenges may
have.

ARTEAR
As from 2005, the ANA brought various claims
against all holders of broadcast and cable
television licenses for the payment of tariffs and
customs taxes applicable to the importation of
films documented between 2000 and 2005.
According to ANA, television licensees are liable
for customs duties, VAT, and income taxes over
the customs value of the films' physical support,
which value is increased by the contractually
agreed value of each film's broadcasting rights.
ARTEAR challenged such claims based on
applicable international agreements, scholars'
opinions and case law. Based on the criterion
applied by ARTEAR, that company paid other
taxes during the period covered by ANA's claim

that would not have been payable had ANA's
interpretation been applied. As of the date of
these financial statements, ARTEAR has had to
pay, in few specific cases, the differences claimed
by ANA, because the appeals filed before the
Federal Court of Appeals against the adverse
decisions rendered by the National Tax Court
do not have staying effect. In connection with
the first adverse decision issued by the only
chamber of the Federal Court of Appeals that
issued a decision to date, and which was
appealed by ARTEAR, the Supreme Court of
Justice refrained from rendering a decision on
the merits. This situation does not change the
position of that company, which continues with
the proceedings available for its defense.
ARTEAR believes that its interpretation of
customs legislation is reasonably grounded and
that the arguments offered may change the tax
authority's position. However, based on
ARTEAR's and its legal advisors' expectations in
this regard on certain cases, and taking into
consideration the amounts temporarily remitted,
ARTEAR has recorded a provision of
Ps. 1.8 million. Nevertheless, ARTEAR believes
that ANA's claims are contrary to the estoppel
doctrine and the theory of the releasing effect of
payment. Until 2005, ANA believed that
customs duties should be paid on the value of
the films' physical support without including
the broadcasting rights paid abroad by that
company.

TRISA
On September 10, 2010, AFIP served TRISA
with a notice with objections to its income tax
assessment, with respect to the application of
the withholding regime set forth under the
section following section 69 of the Income Tax
law, for the fiscal periods 2004, 2005 and 2006.
If AFIP's position prevails, TRISA's contingency
would amount to approximately Ps. 28.9
million, out of which Ps. 9.3 million
corresponds to taxes on dividend payments
made during those years, Ps. 6.5 million
corresponds to a 70% fine on the omitted tax,
and Ps. 13.1 million corresponds to late-
payment interest.

TRISA filed a response, which was dismissed by
the tax authorities. The tax authorities issued
their own official assessment and imposed
penalties on December 20, 2010. TRISA

102 103

appealed the tax authorities' resolution before
the National Tax Court on February 8, 2011.

TRISA and its legal and tax advisors believe
TRISA has strong grounds to defend its
position and that AFIP's challenge will not be
admitted by the Federal Tax Court. Accordingly,
TRISA has not booked an allowance in
connection with the effects such challenge may
have.

8.6. Other undertakings
ARTEAR
Pursuant to ARTEAR's acquisition of 85.2% of
its subsidiary Telecor's capital stock in 2000,
Telecor's sellers have an irrevocable put option
of the remaining 755,565 common, registered,
non-endorsable shares, representing 14.8% of
the capital stock and votes of Telecor, for a 16-
year term as from March 16, 2010 at a price of
USD 3 million and ARTEAR has an irrevocable
call option for such shares for a term of 26 years
as from March 16, 2000 at a price of
approximately USD 4.8 million, which will be
adjusted at a 5% nominal annual rate as from
April 16, 2016.Subsequently, under an
addendum to the original agreements, the
beginning of the effectiveness of the irrevocable
put option was changed from March 16, 2010
to March 16, 2013.

CMD
Pursuant to CMD's acquisition of 60.0% of
Interpatagonia S.A.'s capital stock in 2007,
CMD and the sellers granted each other
reciprocal call and put options on all of the
shares owned by each of the parties, effective
from August 1, 2011 to July 31, 2012.

Subsequently, in connection with the stock
purchase mentioned in Note 9.1.e., on August
17, 2011, CMD and the seller executed a new
agreement whereby they granted each other new
reciprocal call and put options on all of the
shares owned by each of the parties. The price
of the shares varies depending on who exercises
the option, which is effective from August 1,
2014 to December 31, 2014.

8.7. Administrative disputes
a) Matters concerning Papel Prensa:
I. Papel Prensa has several disputes pending
before the Commercial Court of Appeals of the
City of Buenos Aires as a consequence of CNV

Resolution No. 16,222. Pursuant to said
Resolution, the CNV declared that certain
decisions of Papel Prensa's Board of Directors
were irregular and with no effect for
administrative purposes. The Resolution
challenged the Board's fulfillment of the
formalities required in the preparation,
transcription and execution of meeting minutes
on the relevant corporate books. On June 24,
2010, in File No. 75,479/09, the Commercial
Court of Appeals of the City of Buenos Aires,
Chamber C, decided to nullify CNV Resolution
No. 16,222. On the basis of Resolution No.
16,222, the CNV has questioned subsequent
decisions of Papel Prensa's Board and of its
Shareholders. In response, Papel Prensa has
brought several administrative claims against the
CNV, questioning its position. All of such
claims were decided in Papel Prensa's favor by
the Commercial Court of Appeals of the City of
Buenos Aires. Consequently, the CNV's
decisions were nullified. Furthermore, the
Commercial Court of Appeals, Chamber C,
dismissed the appeals filed by the CNV before
the Supreme Court of Argentina against the
Court of Appeals' decisions. The CNV filed a
direct appeal before the Supreme Court.

As a consequence of the above, Papel Prensa has
continued with the criminal proceedings
brought against certain public officials.

On February 1 and 4, 2010 the Secretary of
Domestic Trade, Mario G. Moreno, and the
CNV, respectively, requested the judicial
intervention of Papel Prensa before the
commercial justice. Such claims were pending
before the Federal Commercial Court No. 2 of
First Instance, Clerk's Office No. 4, temporarily
under judge Dr. Eduardo Malde, who, on
March 8, 2010, issued an injunction whereby
he suspended certain decisions adopted at
meetings of the Board of Directors and at
Shareholders Meetings held on or after
November 4, 2009. Judge Malde also appointed
a co-administrator without removing the
members of the previous corporate bodies. Papel
Prensa filed an appeal, which the Commercial
Court of Appeals, Chamber C, resolved in Papel
Prensa's favor, by revoking the injunction on
August 31, 2010. On December 7, 2010 the
same Chamber C dismissed the appeals filed by
the CNV and the National Government before
the Supreme Court of Argentina against the

Court of Appeals' decision. Both the CNV and
the National Government filed direct appeals
against such decision.

None of the claims mentioned in the above
paragraphs had a material effect on AGEA's
financial and economic condition as of
December 31, 2011.

II. On January 6, 2010, the SCI issued
Resolution 1/2010 whereby certain business
practices were imposed on Papel Prensa. Papel
Prensa brought a legal action against such
resolution on grounds of unconstitutionality
before the Federal Court in Administrative
Litigation Matters and requested an injunction
which was granted by the intervening judge.
Pursuant to the injunction, the effects of such
Resolution were suspended. On May 7, 2010,
the Federal Court in Administrative Litigation
Matters revoked the injunction. Papel Prensa
appealed such decision, which was affirmed by
the Federal Administrative Court of Appeals.
Papel Prensa filed an appeal against the Court of
Appeals' decision. The appeal was denied and
Papel Prensa was served notice of that denial on
September 1, 2010. Therefore, as from such
date, SCI Resolution 1/2010 has become fully
effective again on Papel Prensa.

III. Papel Prensa suspended its operations with
related parties between March 9 and April 21,
2010 due to an injunction issued on March 8,
2010 by Judge Malde. In his ruling, he decided
to suspend the Board of Directors' resolution of
December 23, 2009, which had approved the
conditions under which the operations with
related parties for the year 2010 were carried
out. On April 21, 2010, the Board of Directors
of Papel Prensa, in accordance with a proposal
made by the court-appointed supervisor
(interventor) and co-administrator, approved the
resumption of such company's operations with
related parties under provisional conditions for
as long as the decision rendered by the Board on
December 23, 2009 remains suspended and/or
until Papel Prensa's corporate bodies establish a
business practice to follow with related parties.
Such approval involved suspending the
application of volume discounts in connection
with purchases made by related parties, which
could be recognized in their favor, subject to the
court's decision on the appeal filed by Papel
Prensa against Judge Malde's injunction of

March 8, 2010. As from April 21, 2010 the
operations with related parties were resumed
under the provisional conditions approved by
the Board on April 21, 2010.

At a meeting held on December 23, 2010, Papel
Prensa's Board of Directors approved the new
conditions for the recognition and payment of
volume discounts that may be applicable to
related parties in connection with purchases of
paper made as from April 21, 2010. These new
conditions are as follows: (i) to end the
provisional suspension approved by the Board
meeting of December 23, 2009, as explained in
the previous paragraph, and (ii) to clarify and/or
cease, by any means, any uncertainty that could
eventually exist about the conditions approved
by Papel Prensa's Board in the first item of the
agenda of the above mentioned meeting held on
April 21, 2010 in connection with the claim
brought by the National Government in re
“National Government - Secretariat of Domestic
Trade - v./ Papel Prensa S.A.I.C.F. y de M. on/
Ordinary”, File No. 97,564, currently pending
before Federal Commercial Court No. 26 of
First Instance, Clerk's Office No. 52. Under this
proceeding, the National Government seeks to
obtain, among other things, a declaratory
judgment of nullity of the provisional
conditions for the resumption of operations
with related parties in connection with the
purchase and sale of paper approved by Papel
Prensa's Board in the first item of the agenda of
the above mentioned meeting held on April 21,
2010.

Furthermore, at this meeting held on December
23, 2010, Papel Prensa's Board decided to
maintain the business practice previously
approved, subjecting the accrual and
enforceability, and, consequently, the
recognition and payment to the clients, of the
eventual volume discounts that may be
applicable to them as a result of paper purchases
made during 2011, as from January 1, 2011 and
until December 31, 2011, to a final favorable
ruling in the action brought by Papel Prensa on
grounds of unconstitutionality against SCI
Resolution No. 1/2010, or to the final
nullification of such Resolution No. 1/2010 in
any other way or by any other legal means,
whichever happens first. In connection with
related parties, the Board approved the same
business practice and conditions as those
approved for the other clients in general.

104 105

In a meeting held on December 27, 2011 Papel
Prensa's Board of Directors decided to maintain
during 2012 the same business practice that had
been approved for 2011 - under the same terms
and conditions described in the preceding
paragraph - for all of its customers in general
(including related parties).

The business practice approved by Papel Prensa
was affected by Law 26,736 -effective as from
January 5, 2012- which declared a matter of
public interest the production, sale and
distribution of wood pulp and newsprint and
set forth the regulatory framework that will
apply to the producers, sellers, distributors and
buyers of such inputs. Among other things, the
Law set limits and established conditions
applicable to Papel Prensa for the production,
distribution and sale of newsprint (including a
formula to determine the price of paper), and
created the National Registry of Producers,
Distributors and Sellers of Wood Pulp and
Newsprint where all producers, sellers,
distributors and buyers shall be registered as a
mandatory requirement in order to produce,
sell, distribute, and/or purchase newsprint and
wood pulp as from the enactment of the Law. It
also contains a series of temporary clauses,
specifically and exclusively addressed to Papel
Prensa, whereby Papel Prensa is forced to make
investments to meet the total national newsprint
demand - excluding from this requirement the
other existing company that operates in the
country with installed capacity to produce this
input. The Law also provides for the
capitalization of the funds eventually
contributed by the National Government to
finance these investments for the purposes of
increasing the equity interest and the political
rights of the National Government in Papel
Prensa, contravening public order regulations
contained in Law 19,550 and disregarding
several constitutional rights and guarantees of
Papel Prensa and its private shareholders.

On February 10, 2012 AGEA registered with
the National Registry of Producers, Distributors
and Sellers of Wood Pulp and Newsprint
(Record No. 63 in File No. S01:0052528/12),
clearly stating that the decision to register shall
not be construed as an acknowledgment or
conformity with the legitimacy of Law 26,736,
Ministry of Economy and Public Finance
Resolution No. 9/2012 or SCI Resolution No.

4/2012 issued in connection with that Law
and/or any other issued in the future, since they
seriously affect several rights and guarantees of
AGEA which are recognized and protected by
the Argentine National Constitution.

IV. On September 12, 2011, the CNV issued
Resolution No. 16,647 whereby it rendered
irregular and with no effect for administrative
purposes the decisions made by Papel Prensa's
Board of Directors at the meetings held on July
20, 2011 (Minute No. 981) and August 5, 2011
(Minute No. 982). At those meetings, the Board
of Directors had called two shareholders'
meetings, to be held on September 27, 2011
and September 15, 2011, respectively.
Notwithstanding the fact that Resolution No.
16,647 was appealed by Papel Prensa and is
therefore not final, the resolution was also
limited in its effects by a decision rendered on
September 15, 2011 by the judge in charge of
Commercial Court No. 5, Clerk's Office No. 9,
who granted an injunction with respect to the
Board of Directors' decisions to call the two
shareholders' meetings. The injunction had been
requested by the shareholders Arte Gráfico
Editorial Argentino S.A., Compañía Inversora
en Medios de Comunicación (CIMECO) S.A.,
and S.A. La Nación. Given that the issuance of
the injunction had validated Papel Prensa's
decision to call the two shareholders' meetings,
both were held as originally scheduled.
Nevertheless, and based on the above Resolution
No. 16,647, on October 13, 2011 the CNV
issued Resolution No. 16,671 rendering
irregular and with no effect for administrative
purposes all of the decisions made at Papel
Prensa's Shareholders' Meetings held on
September 15, 2011 and September 27, 2011.
Papel Prensa filed an appeal against Resolution
No. 16,671, which is, therefore, not final. Also
based on Resolution No. 16,647, on November
16, 2011, the CNV issued Resolution No.
16,691 whereby the CNV rendered irregular
and with no effect for administrative purposes
the decisions made at the Board of Directors'
Meeting held on October 3, 2011 and the call
for the Board of Directors' meeting on
November 17, 2011. Such Resolution is not to
be deemed final since Papel Prensa filed an
appeal and requested its nullification. In that
regard, on October 3, 2011 at the hearing held
before the Federal Commercial Court No. 26 of
First Instance, Clerk's Office No. 52, the

National Government, Papel Prensa, AGEA and
the other private shareholders agreed, among
other things, on the composition of the
company's corporate bodies, and in particular
on the recognition of the authorities appointed
by the private shareholders at Papel Prensa's
Shareholders' meeting held on September 27,
2011, as well as on the agenda to be addressed
at the meeting of Papel Prensa's Board of
Directors of October 3, 2011, which had been
the subject matter of Resolution No. 16,691.

V. AGEA has not recorded any impact in
connection with the foregoing, since its effects
shall depend on the final outcome. Such effects
are not expected to be material to these
consolidated financial statements as of
December 31, 2011.

b) By means of Resolution 16364/2010, dated
and notified to AGEA as of July 15, 2010, the
CNV's Board of Directors decided to initiate
summary proceedings against AGEA and certain
current and past members of its board of
directors and supervisory commission, for
alleged infringement to the Argentine Business
Associations Law, Decree 677/01 and Law
22,315. AGEA, as well as the current and past
members of the board of directors and
supervisory commission who are subject to the
summary proceedings, duly filed their respective
responses.

c) AGEA received several inspections from the
AFIP aimed at verifying compliance with the
so-called competitiveness plans implemented by
the National Executive Branch. As a result of
such inspections, after several reports issued by
the AFIP and the corresponding Resolutions
issued by the Ministry of Economy, such bodies
allege that certain acts performed by AGEA
during 2002 lead to the nullity of some of the
benefits granted under said plans for an
estimated amount of Ps. 44 million. AGEA and
its legal counsel believe that there are sufficient
arguments in favor of AGEA's position and,
accordingly, no provision has been recorded. An
ordinary legal action has been brought by
AGEA against such Resolutions. As of the date
of these financial statements, such legal action is
pending resolution. However, AGEA cannot
assure that the outcome will be favorable.

Note 9

Equity interests
9.1. Acquisition and disposal of equity interests
a. During 2007, AGEA increased its interest in
CIMECO from 33.3% to 50.0%, and executed
call and put options on an additional interest in
CIMECO's capital stock. During 2008, AGEA
partially assigned the rights and obligations
arising from such options to its subsidiary AGR
and to the Company. Subsequently, in 2008,
AGEA, AGR and the Company exercised such
call option, increasing, directly and indirectly,
the Company's equity interest in CIMECO and
Papel Prensa to 100% and 49%, respectively.

On April 10, 2008, the Company and the
parties to the above-mentioned transaction
notified CNDC of such transaction and on
May 12, 2008 filed form F-1. After such notice
and as of the date of these financial statements,
the Company submitted additional information
requested by the CNDC. As of the date of these
financial statements, the above transaction is
subject to administrative approvals.

b. On January 11, 2008, IESA acquired the
controlling interest of a group of companies
mainly engaged in sports journalism,
production and commercialization of shows,
and the production of motor racing television
broadcasting. The share purchase agreement sets
forth certain objectives to be met by such group
of companies. In case of breach of such
provision, the sellers shall have to pay an
indemnification. These transactions are subject
to administrative approvals.

c. On September 2, 2008, ARTEAR increased
its equity interest in Pol-Ka and SB
Producciones S.A. to 55% of such companies'
capital stock and votes, thus acquiring a
controlling interest in both companies, in which
it previously exercised common control. These
transactions are subject to administrative
approvals.

d. On February 10, 2011, CMD sold to a third
party all of its shares of Dinero Mail, for
approximately USD 4.4 million in cash; part of
the price was withheld as guarantee.

e. On August 17, 2011, CMD executed a stock
purchase agreement, whereby it increased by
20% its interest in Interpatagonia S.A., where it

106 107

now holds 80% of the capital stock. CMD paid
approximately Ps. 4.3 million in consideration
for the shares.

f. On October 3, 2011 the Company's
subsidiary AGR acquired 65.46% of the capital
stock and votes of Cúspide Libros S.A. and
2.40% of the capital stock and votes of Librerías
Fausto S.A.C.E.I. (controlled by Cúspide Libros
S.A.). The transaction amounted to USD 2.8
million and Ps. 3.8 million.

9.2. Distribution of dividends of Cablevisión
On April 25, 2011, at the Regular Shareholders'
Meeting of Cablevisión, a subsidiary under the
Company's control, the shareholders decided to
distribute dividends in the amount of Ps. 405
million, payable in two equal installments, out
of which approximately Ps. 162 million belong
to minority shareholders. The first installment
was made available to Cablevisión's shareholders
on May 4, 2011. On October 17, 2011
Cablevisión informed the CNV that the second
and last installment of such dividends would be
available as from October 19, 2011.

Note 10

Agreements executed with the AFA
On June 22, 2007 TRISA and TSC executed
several documents with AFA, applicable from
the 2007/2008 until the 2013/2014 soccer
seasons, governing the broadcasting by TRISA
of all of the National “B” soccer tournament
matches and by TSC of ten of the Argentine
soccer first division official tournament matches
played each week. Out of those ten matches,
TRISA broadcast five through TyC Sports.

On August 12, 2009, the AFA notified TSC of
its decision to terminate unilaterally the above-
mentioned agreement. TSC has challenged
AFA's unilateral termination of the agreement
and, in order to safeguard its rights, on June15,
2010 it brought a legal action against the AFA
for contractual breach and damages.

On July 27, 2011, AFA unilaterally terminated
the agreement that bound AFA and TRISA
until the 2013/2014 soccer season for the
broadcasting of all Argentine National “B”

soccer tournament matches. AFA's decision was
absolutely arbitrary and illegitimate. TRISA has
not breached any provision of the agreement,
which does not expressly allow voluntary
unilateral termination by either party without
cause. Therefore, TRISA has challenged AFA's
unilateral termination of the agreement.

In light of the events and until the situation is
remedied, TRISA will not be able to broadcast
the five weekly matches of the first division
tournament or any of the National “B” soccer
tournament matches that it used to broadcast
on its signal TyC Sports.

The broadcasting rights for the matches of
Metropolitan First B category are not governed
by the above-mentioned agreements, but by an
agreement that is in full force and effect as of
the date of these financial statements.

The situation described had a significant impact
on TRISA's revenues and costs. Therefore, it
had to adjust its signal to these new
circumstances. Nevertheless, TRISA has
recorded decreased revenues as from August
2009 and made another estimate in the last
quarter recognizing decreased revenues for the
previous period, based on the progress of
negotiations with each client and the new
content of the signal.

The total revenues recognized by TRISA during
the years 2011 and 2010, subject to the final
outcome of the negotiation process, which has
not been concluded as of the date of these
financial statements, account for approximately
56% and 47% of the total sales of 2011 and
2010, respectively.

The final outcome of the negotiation process is
uncertain and may, therefore, generate actual
results different from TRISA's assessments and
estimates as of the date of these financial
statements.

Note 11

Regulatory framework for broadcasting services
In connection with the information disclosed in
Note 15 to the Company's parent company

only financial statements, the Company's
subsidiaries that exploit broadcasting services
have duly followed all the procedures provided
by the Enforcement Authority in spite of having
challenged the validity or constitutionality of
some regulations issued by the Enforcement
Authority under Law 26,522 only in the event
that such regulations may be considered valid,
for the purposes of safeguarding their rights.
Some of the procedures followed are:

- The procedure provided by AFSCA Resolution
No. 1/2011, together with the Argentine
Federal Revenue Service, regulating the tax
applicable to broadcasting companies;
- The procedures provided by AFSCA
Resolutions No. 2/2010, 3/2010 and 4/2010
whereby such agency: i) provided for a
mandatory survey of all precarious and
provisional licenses, authorizations and permits
(Decree No. 1,357/89- Evidence of Request for
“Re-registration”) and of currently recognized
(Resolution No. 753/COMFER/06 as
amended) AM and FM radio stations and
broadcast television stations within Argentina;
ii) initiated a process aimed at reordering
television services with limited reach; and iii)
regulated the Registry of signals provided under
Law 26,522 for the broadcasters to register
signals to be broadcast in the Argentine
territory;

- The procedure provided by AFSCA Resolution
No. 173/2010 regarding the Audiovisual
Communication Services Providers Information
System;

- The procedures provided by Decree No.
904/2010 and AFSCA Resolution No.
175/2010 concerning the Signals and
Production Companies Registry;

- The procedure provided by AFSCA Resolution
No. 474/2010 ordering the creation of a
schedule to comply with the minimum required
content production quotas under section 65,
subsection 2 of Law 26,522;

- The procedures provided by AFSCA
Resolution No. 630/2010 which approved the
Regulatory Framework for the Public Registry
of Advertising Agencies and Producers. Such
Resolution is aimed at regulating the sale of
advertising spaces on broadcasting services

encompassing both Agencies advertising on the
services governed by Law 26,522, as well as
companies acting as intermediaries for the sale
of advertising on such services.

Even though the Company's subsidiaries that
are subject to these resolutions have complied
with the required procedures, they have done so
only in the event that such requirements may be
considered valid, for the purposes of
safeguarding their rights and in the
understanding that both the Law and its
regulations are still suspended.

Of particular note is the procedure
implemented by Cablevisión to comply with
AFSCA Resolution No. 296/2010. On
September 8, 2010, such Resolution was
published in the Official Gazette. This
resolution provides guidelines for the
organization of the programming grid that must
be followed by the owners of pay TV
audiovisual services. The resolution regulates
section 65, subsections a) and b) of Law No.
26,522 and supplements the provisions of the
regulations to the same section of Decree No.
1,225/2010. Cablevisión believes that both the
provisions of Decree No 1,225/2010 and
AFSCA Resolution No. 296/2010 are regulatory
abuses and violate the right to freedom of press,
guaranteed by the National Constitution.

In spite of Cablevisión's efforts to organize its
programming grids in accordance with the
provisions of section 65 of Law 26,522,
AFSCA, disregarding the effectiveness of several
court decisions ordering the suspension of this
law and its regulations, has initiated multiple
summary proceedings in connection with the
cable television licenses of which Cablevisión is
the lawful successor. AFSCA contends that
Cablevisión failed to comply with the
regulations set forth by AFSCA Resolution No.
296/2010. Cablevisión submitted the responses
set forth under section 1, Exhibit II of AFSCA
Resolution No. 224/2010 in connection with
such accusations. A decision has been rendered
on some of the summary proceedings and, as a
result, a fine was imposed on Cablevisión.
Cablevisión has appealed these decisions. Some
of the appeals filed by Cablevisión have been
decided against it and have again been appealed.
Notwithstanding the above, none of the
decisions imposing penalties is yet final.

108 109

appropriate responses on behalf of the merged
licensees charged as indicated above, which to
date have not been decided upon. Cablevisión
believes it has strong grounds to reverse the
charges brought by administrative and/or
judicial means. As of the date of these financial
statements, the responses submitted are still
pending resolution.

AFSCA issued Resolution No. 432/2011
whereby it approved new bidding terms and
conditions for the granting of licenses.

In order to properly understand this note, the
Company's management recommends that it be
read together with Note 15 to the parent
company only financial statements.

Note 12

Award under the public bidding process conducted

by the government of the city of Buenos Aires
On June 7, 2007, the Government of the City
of Buenos Aires issued Decree No. 316 whereby
it approved a public bidding process to contract
comprehensive digital services for educational
purposes for elementary school students in the
City of Buenos Aires. Such services include, but
are not limited to, the delivery of one netbook
per student and one notebook per teacher under
a gratuitous bailment agreement, connectivity,
first and second level support, content access
control, replacement in case of theft or damage
and new license, both with certain limitations.
The bid was awarded to PRIMA for a five-year
term, which will start after certain requirements
have been met. As consideration, PRIMA would
receive an amount per student, teacher and
school.

As of December 31, 2011 the initial
requirements have been met in order to bring
the agreement into effect and to begin its
billing.

Notwithstanding the foregoing, AFSCA
Resolution No. 296/2010 had virtually no
effectiveness because, due to its arbitrariness, it
was repeatedly suspended by several court
decisions, some of them as a result of appeals
filed by Cablevisión and others filed by other
providers. To date, two court decisions that
order the Resolution's inapplicability are still
into effect, to wit: i) the injunction issued in re
“CODELCO v. NATIONAL
GOVERNMENT -EXECUTIVE BRANCH
on PRELIMINARY INJUNCTION” pending
before the Federal Court of Salta which
suspended, among others, the application of
section 65 of Law 26,522 and its regulations.
Even though such decision was revoked by the
Federal Court of Appeals of Salta, the Court of
Appeals' decision may be deemed not to be final
since the affected party filed an extraordinary
appeal, thereby restoring the effects of the
decision rendered in the first instance and ii) the
injunction ordered in re “CABLEVISIÓN S.A.
v. NATIONAL GOVERNMENT AND
OTHERS ON COMPLAINT FOR THE
PROTECTION OF CONSTITUTIONAL
RIGHTS” by the Federal Court of Appeals of
Mar del Plata, whereby the decision rendered in
the First Instance was revoked. Such decision
rendered in the First Instance had ordered the
dismissal of Cablevisión's request, ordering
AFSCA to suspend - until a final decision was
rendered on the matter - the application of the
penalties derived from the alleged non-
compliance with section 65 of Law 26,522 and
Decree No. 1225/2010 and the application of
section 6 of AFSCA Resolution No. 296/2010
on the grounds that Cablevisión's alleged
serious non-compliance was not contemplated
in the Law or in the Decree. The National
Government filed an appeal with the Supreme
Court against this decision. Such appeal is still
pending resolution.

Between September and October 2011, AFSCA
brought 46 charges of delegation of the
exploitation of several licenses of which
Cablevisión is currently the legal successor. The
charges were brought within the framework of
COMFER file No. 2005/08, concerning the
registration of the corporate reorganization
whereby Multicanal and Teledigital Cable,
among other subsidiaries, merged into
Cablevisión. Cablevisión has submitted the

Note 13

Income tax
The following table shows the breakdown of
consolidated net deferred tax assets as of
December 31, 2011 and 2010, respectively
(amounts stated in thousands of Argentine
Pesos):

Tax loss carryforward

Specific tax loss carryforward

Trade receivables

Inventories

Property, plant and equipment, net

Intangible Assets, net

Other assets

Other investments

Provisions

Accounts payable

Long-term debt

Other

Subtotal

Valuation allowance for net deferred tax assets -

Exhibit E Consolidated

Net deferred tax assets and liabilities

December 31, 2011

December 31, 2010

74,029

477

(19,835)

1,508

(116,443)

(135,283)

(3,718)

(2,097)

49,064

18,930

(17,917)

(20,218)

(171,503)

(31,274)

(202,777)

35,428

5,768

43,890

861

(104,460)

(220,281)

(3,920)

7,835

38,392

4,242

2,749

(16,631)

(206,127)

(26,978)

(233,105)

110 111

The following table shows the reconciliation
between the consolidated income tax charged to
income for the years ended December 31, 2011
and 2010 and the income tax liability that
would result from applying the current tax rate
on consolidated income before income and
assets taxes and the income tax liability assessed
for each year (amounts stated in thousands of
Argentine Pesos):

Income tax assessed at the current tax rate (35%)

on income before income tax

Permanent differences:

- Equity in earnings (losses) from affiliates and subsidiaries

- Non-taxable income

- Presentation of financial statements in constant

Argentine Pesos

- Other

Subtotal

Valuation allowance for net deferred tax assets charged

to income - Exhibit E Consolidated

Income tax charge

Deferred income tax for the year

Deferred current income tax income (expense) for the year

Income tax charge

Tax on assets

Total

(1) Does not include Ps. 17.3 million corresponding
to net deferred tax liabilities due to the deconsolidation
of companies that took place during 2010.

December 31, 2011

December 31, 2010

(435,284)

(458,118)

5,833

(13,327)

(73)

(78)

(442,929)

(8,933)

(451,862)

30,328

(482,190)

(451,862)

(2,373)

(454,235)

1,425

(25,134)

(2,366)

1,453

(482,740)

(6,267)

(489,007)

(1) 51,835
(540,842)

(489,007)

(4,425)

(493,432)

As of December 31, 2011, the Company's and
its subsidiaries' consolidated accumulated tax
losses amount to approximately Ps. 212.8
million, which calculated at the current tax rate,
represent deferred tax assets in the amount of
Ps. 74.5 million. The following table shows the
expiration date of the accumulated tax losses
pursuant to statutes of limitations (amounts
stated in thousands of Argentine Pesos):

Amount of

tax loss

carryforward

2,686

16,350

15,754

31,838

23,872

122,375

212,875

Expiration year

2011

2012

2013

2014

2015

2016

Note 14

Subsequent events
a. On January 31, 2012, FADRA informed
Grupo Carburando's subsidiary Mundo Show
S.A. the unilateral rescission of the agreement
executed in 2006 whereby FADRA assigned to
that company the rights comprising image,
sound and static advertising of motor racing at
the road racing events Turismo Carretera and
TC Pista until December 31, 2015. Mundo
Show S.A. has challenged and rejected FADRA's
unilateral rescission of the agreement and is
analyzing the legal actions it will bring to
safeguard its rights. In light of the events and
until the situation is remedied, Mundo Show

S.A. will not be able to sell or export the
audiovisual and static advertising rights of the
above-mentioned motor racing events.
Therefore, an allowance has been set up for
impairment of goodwill and other assets related
to such agreement in the amount of
approximately Ps. 17 million.

b. On January 13, 2012, the Secretariat of
Domestic Trade issued Resolution No. 2/2012
granting Cablevisión 24 hours to resume service
to those subscribers who had duly paid their
subscription fee in the amount established by
the National Government. In its sixth section,
the Resolution provides that if the company
does not comply with its obligations thereunder,
penalties may be imposed as provided by Law
20,680. On February 10, 2012, Cablevisión
received a fine of Ps. 1 million for alleged non-
compliance with such Resolution. Such fine has
been appealed but no decision has been
rendered on the matter yet.

c.On January 5, 2012, AFIP issued General
Resolution No. 3252/12, establishing as from
February 1, 2012 a prior disclosure regime
applicable to all final destinations of imports for
consumption implemented by means of a prior
disclosure affidavit. This resolution was
supplemented by General Resolutions No.
3255/12 and No. 3256/12, whereby a
“Ventanilla Unica Electrónica del Comercio
Exterior” (Foreign Trade Electronic Platform)
was created. On February 9, 2012, AFIP issued
General Resolution No. 3276/12 whereby it
adds to the “Ventanilla Unica Electrónica del
Comercio Exterior”, as from April 1, 2012,
information related to services that involve
payment of amounts above certain thresholds
rendered by foreign companies to Argentine
residents and services rendered by Argentine
residents to foreign companies.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

112 101

Allowances
and Provisions

As of December 31, 2011
and 2010
In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements

Exhibit E Consolidated

Deducted from assets

For doubtful accounts

For other doubtful accounts

For impairment of inventories

For investment impairment

For property, plant and equipment impairment and obsolescence of materials

For goodwill impairment

Valuation allowance for net deferred tax assets

Valuation allowance for Tax on assets

Total as of December 31, 2011

Total as of December 31, 2010

Included in liabilities

For contingencies

Total as of December 31, 2011

Total as of December 31, 2010

(1) Includes Ps. 42,375,748 corresponding to net increases which have
been charged to Selling expenses (see Exhibit H) and Ps. 190,942 which
have been charged to Financing and holding results.
(2) Includes Ps. 6,906,490 charged to Financing and holding results.
(3) Charged to Income tax.
(4) Charged to Tax on assets.
(5) Includes Ps. 51,505,339 corresponding to net increases which have
been charged to Contingencies (see Exhibit H) and Ps. 5,421,307 which
have been charged to Financing and holding results.
(6) Charged to Other income (expense), net
(7) Charged to Financing and holding results.

Balance at the

beginning of the year

128,836,360

3,394,672

511,490

355,609

15,634,149

808,594,106

26,978,226

41,036,137

1,025,340,749

1,047,719,435

155,378,087

129,763,743

Additions (retirements)

from consolidation /

deconsolidation of

subsidiaries

(3,058,509)

Increases

Decreases

December 31, 2011

December 31, 2010

Balances as of

(1) 48,162,718
(1) 58,189
(2) 3,192,707
(6) 73,200
(2) 3,758,292
(7) 12,053,573
(3) 8,933,052
(4) 2,853,307

79,085,038

56,846,491

(1) 47,699,216
-
(2) 527,932
-
(2) 3,759,962
-

4,637,317
(4) 5,279,372

61,903,799

76,166,668

129,299,862

3,452,861

3,176,265

428,809

15,632,479

820,647,679

31,273,961

38,610,072

1,042,521,988

128,836,360

3,394,672

511,490

355,609

15,634,149

808,594,106

26,978,226

41,036,137

1,025,340,749

4,379,652

(5) 60,014,301

(5) 31,073,356

188,698,684

155,378,087

4,379,652

(14,599,585)

60,014,301

64,375,458

31,073,356

24,161,529

188,698,684

155,378,087

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

114 115

Cost of Sales

Exhibit F Consolidated

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements

Inventories at the beginning of the year

Additions (retirements) from consolidation /

deconsolidation of subsidiaries

Purchases for the year

Production expenses - Exhibit H Consolidated

Holding gains on inventories

Inventories at year-end

December 31, 2011

December 31, 2010

292,312,439

270,282,713

4,662,982

902,067,153

4,064,376,730

20,677,069

(411,605,831)

(39,701,602)

511,104,432

3,115,915,876

31,815,706

(292,312,439)

Cost of sales

4,872,490,542

3,597,104,686

Information required
under Section 64,
Subsection b) of
Law No. 19550

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1 to the parent company
only financial statements

Exhibit H Consolidated

Item

Fees for services

Salaries, Social

Security and benefits

to personnel

Advertising and

promotion expenses

Taxes, duties and

contributions

Doubtful accounts

Travel expenses

Maintenance expenses

Distribution expenses

Communication

expenses

Contingencies

Stationery and

office supplies

Commissions

Productions and

co-productions

Printing expenses

Rights

Services and satellites

Severance payments

Non-computable VAT
Rentals

Other expenses

Total as of

Production

expenses

Selling

Administrative

December 31,

expenses

2011

2010

Total as of

200,410,800

45,365,915

300,897,220

546,673,935

373,136,067

1,752,411,207

335,176,446

495,234,194

2,582,821,847

1,916,773,401

290,566,764

705,553

291,272,317

200,870,678

130,079,797

235,749,945

29,362,006

395,191,748

286,788,545

48,249,258

296,527,723

22,122,843

3,298,165

35,183,212

42,375,748

23,663,070

22,437,673

33,637,709

2,350,659

9,930,798

97,495,257

7,310,208

16,322,127

42,375,748

81,843,126

416,460,653

55,760,552

10,696,072

63,803,861

362,650,872

41,323,143

12,959,032

51,505,339

11,688,887

57,654,729

2,993,845

4,657,598

10,760,410

17,809,152

161,977,382

25,460,595

172,737,792

19,630,863

136,153,824

151,306,090

133,194,717

878,492,485

164,361,600

21,101,921

18,766,233
114,388,989

91,487,845

611,273

5,775,479

-
5,284,050

27,873,868

11,392,808

4,743,146

-
14,570,853

27,367,847

151,306,090

133,194,717

878,492,485

176,365,681

31,620,546

18,766,233
134,243,892

146,729,560

121,072,970

97,147,712

686,362,900

144,640,815

31,417,003

14,503,828
97,426,989

125,248,666

December 31, 2011

4,064,376,730

1,086,286,607

1,195,118,551

6,345,781,888

Total as of

December 31, 2010

3,115,915,876

761,561,527

921,514,422

4,798,991,825

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

FINANCIAL
STATEMENTS

116 117

Balance Sheets

As of December 31, 2011
and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Assets

Current assets

Cash and banks - Note 3.a

Other investments - Exhibit D

Other receivables, net - Note 3.b

Total current assets

Non-current assets

Other receivables, net - Note 3.b

Investments - Exhibit C

Property, plant and equipment, net - Exhibit A

Total non-current assets

December 31, 2011

December 31, 2010

2,950,680

29,866,561

85,113,690

117,930,931

10,382,970

3,795,862,738

919,419

3,807,165,127

3,055,959

13,639,242

5,040,993

21,736,194

11,880,074

3,370,483,445

1,011,711

3,383,375,230

Total assets

3,925,096,058

3,405,111,424

Liabilities

Current liabilities

Accounts payable - Note 3.c

Long-term debt - Notes 4 and 8 and Exhibit G

Salaries and Social Security payable

Taxes payable - Note 3.d

Other liabilities - Note 3.e

Total current liabilities

Non-current liabilities

Other liabilities - Note 3.e

Total non-current liabilities

3,026,654

127,730,585

17,313,431

2,609,920

13,555,211

164,235,801

25,655,827

3,065,334

71,242,000

13,638,125

1,463,118

11,719,705

101,128,282

19,125,902

Total liabilities

189,891,628

120,254,184

Shareholders’ Equity (as per corresponding statements)

3,735,204,430

3,284,857,240

Total liabilities and shareholders' equity

3,925,096,058

3,405,111,424

The accompanying Notes 1 to 15 and Exhibits A, C, D, E, G
and H are an integral part of these financial statements.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

Statements of
Income

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Equity in earnings from affiliates and

subsidiaries - Note 3.f

Management fees

Administrative expenses - Exhibit H

Depreciation of property, plant and equipment - Exhibit A

Financing and holding results

Generated by assets

- Exchange difference and other financial results

- Interest

- Other taxes and expenses

Generated by liabilities

- Exchange difference and other financial results

- Interest

- Holding losses (gains) on derivatives

Other expenses, net

Income for the year before Income tax and Tax on assets

December 31, 2011

December 31, 2010

556,863,882

77,689,987

(82,403,353)

(559,055)

561,802

95,399

(2,031,828)

(1,851,375)

(13,380,039)

(11,563,098)

523,422,322

566,155,425

63,199,667

(63,891,631)

(744,330)

2,715,829

451,050

(1,469,113)

(6,558,302)

(8,358,209)

(449,600)

(11,945,220)

539,105,566

Income tax and Tax on assets - Note 6

(1,142,945)

(988,686)

Net income for the year

522,279,377

538,116,880

Basic net income per share

1.82

1.87

The accompanying Notes 1 to 15 and Exhibits A, C, D, E, G
and H are an integral part of these financial statements.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

118 119

Statements of
Changes in
Shareholders’ Equity

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Balances as of December 31, 2009

Change in the balance (Note 2.4)

Balances changed as of December 31, 2009

Constitution of Legal Reserve (Note 11.2)

Cumulative translation adjustment for the year

Net income for the year

Balances as of December 31, 2010

Constitution of Legal Reserve (Note 11.2)

Distribution of dividends (Note 11.2)

Cumulative translation adjustment for the year

Net income for the year

Capital Stock

Inflation

Adjustment on

Capital Stock

287,418,584

309,885,253

287,418,584

309,885,253

287,418,584

309,885,253

Balances as of December 31, 2011

287,418,584

309,885,253

The accompanying Notes 1 to 15 and Exhibits A, C, D, E, G and H
are an integral part of these financial statements.

(

Cumulative

Translation

Paid-in Capital

Subtotal

Legal reserve

Adjustment

Accumulated Deficit

1,413,334,666

2,010,638,503

1,413,334,666

2,010,638,503

23,547,182

14,507,327

1,413,334,666

2,010,638,503

38,054,509

26,685,724

57,204,637

14,240,155

71,444,792

48,067,813

689,542,987

(48,433,104)

641,109,883

(14,507,327)

538,116,880

1,164,719,436

(26,685,724)

(120,000,000)

522,279,377

Total

shareholders'

equity

2,780,933,309

(48,433,104)

2,732,500,205

14,240,155

538,116,880

3,284,857,240

(120,000,000)

48,067,813

522,279,377

1,413,334,666

2,010,638,503

64,740,233

119,512,605

1,540,313,089

3,735,204,430

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

120 121

Statements
of Cash Flows

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Cash used in operating activities

Net income for the year

Income tax and tax on assets

Accrued interest, net

December 31, 2011

December 31, 2010

522,279,377

538,116,880

1,142,945

13,284,640

988,686

7,907,159

Adjustments to reconcile net income for the year

to cash used in operating activities:

- Depreciation of property, plant and equipment

- Equity in earnings from affiliates and subsidiaries

- Exchange difference and other financial results

- Holding losses (gains) on derivatives

Changes in assets and liabilities:

- Other receivables

- Accounts payable

- Salaries and Social Security payable

- Taxes payable

- Other liabilities

- Tax on assets payments

559,055

(556,863,882)

1,271,397

(22,429,789)

(38,680)

3,675,306

1,538,014

1,835,506

(1,229,415)

744,330

(566,155,425)

3,714,332

449,600

5,565,943

(479,015)

1,969,286

(900,167)

1,790,408

(2,439,114)

Cash used in operating activities

(34,975,526)

(8,727,097)

Cash provided by investment activities

Dividends collected

Capital contributions in subsidiaries

Acquisition of property, plant and equipment

Collection of loans and interest

Loans granted

Cash provided by investment activities

58,378,830

(5,176,800)

(466,763)

2,670,041

(3,000,000

52,405,308

40,631,795

(9,663,565)

(515,465)

500,000

(1,000,000)

29,952,765

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Cash used in financing activities

Payment of sellers financing

Loans obtained

Payment of loans

Payment of interest

Payment of dividends

Payments on derivatives

Cash used in financing activities

Financing and holding gains generated

by cash and cash equivalents

Net Increase / (decrease) in cash flow

Cash and cash equivalents at the beginning of the year

December 31, 2011

December 31, 2010

121,637,672

(3,263,963)

(265,938)

(120,000,000)

(1,892,229)

584,487

16,122,040

16,695,201

(119,100,000)

84,589,305

(27,048,000)

(8,508,395)

(3,575,600)

(73,642,690)

3,274,623

(49,142,399)

65,837,600

Cash and cash equivalents at the end of the year (1)

32,817,241

16,695,201

(1) Includes:

Cash and banks

Investments with original maturities

of less than three months

The accompanying Notes 1 to 15 and Exhibits A, C, D, E, G
and H are an integral part of these financial statements.

2,950,680

3,055,959

29,866,561

13,639,242

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

122 123

Notes to the
Financial
Statements

As of December 31, 2011
and 2010
In Argentine Pesos (Ps.) -
Note 2.1, unless otherwise
specifically indicated

Note 1

The Company
Grupo Clarín is a holding company that
operates in the Media industry. Its operating
income and cash flows derive from the
operations of its subsidiaries in which it
participates directly or indirectly.

Its operations include cable television and
Internet access services, newspaper and other
printing, publishing and advertising activities,
broadcast television, radio operations and
television content production, on-line and new
media services, and other media related
activities. A substantial portion of its revenues is
generated in Argentina. Through its subsidiaries,
it is engaged primarily in the following business
segments:

- Cable Television and Internet Access,
consisting of the largest cable network in Latin
America in terms of subscribers, operated by its
subsidiary Cablevisión (surviving company after
its merger with Multicanal and Teledigital), with
operations in Argentina and neighboring
countries. This company also provides high-
speed Internet access under the brands Fibertel
and Flash;

- Printing and Publishing, consisting of national
and regional newspapers, a sports daily,
magazine publishing, editing and distribution,
and commercial printing. Diario Clarín, the
flagship national newspaper, is the newspaper
with the second largest circulation in the
Spanish-speaking world. The sports daily Olé is
the only newspaper of its kind in the Argentine
market. The newspaper La Razón is the first
ever free newspaper in Argentina. The children's
magazine Genios is the children's magazine with
the highest circulation in Argentina. AGR is its
printing company;

- Broadcasting and Programming, consisting of
the broadcast television station with the highest
share of prime time audience (Canal 13),
AM/FM radio broadcast stations (Radio Mitre
and La 100), and the production of television,
film and radio programming content, including
cable television signals and organization and
broadcasting of sporting events; and

- Digital Content and Other, consisting mainly
of digital and Internet content, online classified

ads and horizontal portals as well as its
subsidiary GCGC, its shared service center.

Note 2

Basis for the preparation and presentation of the

financial statements
The Company's financial statements have been
prepared in accordance with generally accepted
accounting standards effective in the City of
Buenos Aires, Argentina, and in accordance
with the Argentine Securities and Exchange
Commission (CNV) rules. Such standards have
been applied consistently to the information
presented for comparative purposes.

In order to understand properly the financial
position and the changes in the results of the
Company and its subsidiaries, the Company's
management recommends that the parent
company only financial statements be read
together with the consolidated financial
statements, which are presented as
supplementary information and are an integral
part of the parent company only financial
statements.

2.1. Presentation of financial statements in
constant Argentine Pesos
These financial statements have been prepared
in constant currency, pursuant to the
restatement method set forth by FACPCE's
Technical Resolution No. 6, whereby the effects
of the changes in the currency purchasing power
are to be recognized comprehensively during
inflationary periods. Furthermore, it establishes
that the adjustment for inflation shall not be
applied during periods of monetary stability.

2.2. Summary of critical accounting policies
The critical accounting policies applied to the
preparation of these financial statements are
detailed below:

a. Cash and banks
- In local currency: at face value.

- In foreign currency: translated at the exchange
rates prevailing at each year-end for the
settlement of these transactions. Foreign
exchange differences were charged to income for
each year. The respective breakdown is shown in
Exhibit G.

b. Other investments
- In local currency: valued at nominal value,
plus interest accrued at each year-end.

- In foreign currency: Valued at nominal value
plus accrued interest, where applicable, and
translated to the exchange rate prevailing at the
end of each year. Foreign exchange differences
were charged to income for each year. The
respective breakdown is disclosed under Exhibits
D and G.

c. Other receivables, net and liabilities
- In local currency: valuation has been
determined by calculating the discounted value
of cash flows to be generated by such receivables
and liabilities, except for deferred tax assets and
liabilities which have not been discounted.
Receivables and liabilities with discounted
values which do not materially differ from their
nominal value have been valued at the nominal
value of the corresponding transaction.

- In foreign currency: have been valued as
mentioned above, taking into account the
exchange rates prevailing as of each year end.
Foreign exchange differences were charged to
income for each year. The respective breakdown
is disclosed under Exhibit G.

Accounts receivable and liabilities include the
accrued portion of the respective financing gains
(losses) as of each year end.

The item Other non-current receivables is
disclosed net of the valuation allowance for net
deferred tax assets (see Note 6) and of the
valuation allowance for tax on assets. The
changes in such allowances are disclosed under
Exhibit E.

d. Long-term investments in affiliates and
subsidiaries - Goodwill

Long-term investments in subsidiaries and
affiliates were valued by applying the equity
method as established by FACPCE Technical
Resolution No. 21 (“TR 21”).

The accounting criteria used by the subsidiaries
and affiliates are the same as those used by the
Company; in those cases in which they differed,
the corresponding adjustments were made. A
breakdown of the Company's interest in these
companies is shown in Exhibit C.

During the years ended December 31, 2009 and
2010, certain subsidiaries decided to adhere to a
regime for the regularization and financing of
tax liabilities.

The financial statements of foreign companies
considered as integrated were translated
pursuant to the provisions of FACPCE TR 18.
Accordingly, amounts measured in foreign
currency were translated to Argentine pesos,
applying the exchange rate prevailing on the
date in which the purchasing power of each
amount measured was stated.

The financial statements of non-integrated
foreign companies, which are indirectly
controlled by the Company, have been
translated to Argentine pesos, pursuant to the
provisions of FACPCE TR 18, applying one of
the methods applicable to non-integrated
companies (current exchange rate). Translation
differences were allocated to the Statements of
Changes in Shareholders' Equity, under
“Cumulative translation adjustment”.

Goodwill is the difference between the cost and
the fair market value of acquired and
identifiable net assets. Goodwill was restated
following the guidelines of Note 2.1.

The Company amortized Goodwill over a 20-
year period until December 31, 2002. As from
January 1, 2003, the Company adopted the
amortization criterion established by the
prevailing accounting standards and,
accordingly, ceased to amortize goodwill that is
considered to have an indefinite useful life
directly related to the business of the respective
investments. Nevertheless, as mentioned in
Note 15 to the parent company only financial
statements and in Note 11 to the consolidated
financial statements, the useful life of this
goodwill could be affected by the final outcome
of the circumstances described in such note.

The Company periodically assesses the
goodwill's recoverable value, based on the
projected discounted cash flows and other
information available as of the date of the
financial statements. The carrying value of long-
term investments and goodwill, net of the
booked allowances, does not exceed their
recoverable value as of each year end.

124 125

e. Property, plant and equipment, net
Property, plant and equipment and other
investments have been valued at acquisition
cost, restated as set forth in Note 2.1, net of the
respective accumulated depreciation as of each
year end. These assets are depreciated on a
straight line basis, applying rates that are
sufficient to extinguish their values at the end of
their estimated useful lives.

The value of these assets does not exceed their
recoverable value. Changes in property, plant
and equipment are shown in Exhibit A.

f. Derivatives
Receivables and liabilities generated by
derivatives have been valued at their estimated
fair value. Changes in the valuation of such
financial instruments have been recognized as
result for the year in which they are effected.

g. Shareholders' equity
Capital stock has been recorded at its nominal
value. As stated in Note 2.1, the restatement
adjustment is shown under the item Inflation
Adjustment on Capital Stock.

The other shareholders' equity accounts are
stated at their historical value, restated as set
forth in Note 2.1.

h. Statement of Income accounts
The charges for consumption, depreciation and
amortization of non-monetary assets were
calculated based on the adjusted amounts of
such assets, as indicated in Note 2.1. The other
Statement of income accounts are stated at
nominal values.

i. Income tax and tax on assets
The Company accounts for income tax using
the deferred tax method. Such method consists
of recognizing the tax effects of the temporary
differences between the accounting and tax
valuation of assets and liabilities and the
subsequent charge to income in the years where
such differences are reversed. Furthermore, it
provides for the possibility of using tax losses in
the future. In conformity with the current
accounting standards applicable to the
Company, deferred tax assets and liabilities have
not been discounted. The differences arising
from restating the historical cost of property,

plant and equipment in constant currency, the
deduction of which is not recognized for tax
purposes, have been considered as permanent
differences. Therefore, no deferred taxes should
be recognized. As of December 31, 2011, the
Company's property, plant and equipment
balances were not adjusted for inflation. Note 6
contains further information on deferred taxes.

The Company has examined the recoverable
value of deferred assets, based on its business
plans and has booked a valuation allowance, in
order for the deferred tax asset net position to
reflect the probable recoverable value. The
changes in such allowance are disclosed under
Exhibit E.

The tax on assets is supplementary to income
tax. While income tax is levied on the taxable
income for the year, tax on assets is imposed on
the potential income from certain productive
assets at the rate of 1%. Therefore, the
Company's tax liability shall be equal to the
higher of both taxes. However, if the tax on
assets exceeds income tax in any given fiscal
year, the excess may be creditable against any
excess of income tax over the tax on assets in
any of the following ten years.

The tax on assets balance has been capitalized
under Other non-current receivables, net of a
valuation allowance, based on the Company's
current business plans. The changes in such
allowance are disclosed under Exhibit E.

j. Earnings per share
Earnings per share have been calculated based
on the weighted average number of outstanding
common shares during each year.

2.3 Use of estimates
The preparation of the financial statements in
conformity with professional accounting
standards effective in the City of Buenos Aires,
Argentina, requires Company's management to
make estimates and assumptions that affect the
reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities as
of the date of the financial statements and the
reported amounts of revenues and expenses for
each year. Actual results could differ from these
estimates.

2.4 Change in accounting policy. Adjustment
to net income from prior years
In connection with the difference between the
book value adjusted for inflation and the fiscal
value of property, plant and equipment, until
September 30, 2011 and applying CNV
General Resolution No. 487/06, the Company
did not recognize deferred tax liabilities arising
from such difference, and disclosed such
practice in a note to the financial statements, in
accordance with Argentine professional
accounting standards.

On July 1, 2010, CNV approved General
Resolution No. 576/2010, subsequently
amended by General Resolution No. 592/2011,
which provides that the companies that
exercised the option of disclosing the deferred
tax liabilities arising from the application of the
adjustment for inflation in a note to the
financial statements, shall recognize such
liabilities under IFRS with an offsetting entry
under retained earnings in any interim or
annual period until the closing of the year
immediately preceding the year in which IFRS
are implemented for the first time. Additionally,
such resolution sets forth a one-time provision
establishing that shareholders' meetings
considering the financial statements for the year
in which such deferred tax liabilities are
recognized may charge to retained earnings the
amount of the above-mentioned liabilities, with
an offsetting entry under items of shareholders'
equity that are not represented by shares or with
an offsetting entry under reserve accounts,
without a predefined order for this allocation.

Given that of December 31, 2011, the
Company has fully amortized the property,
plant and equipment adjusted for inflation, it
has only recognized the effect on retained
earnings arising from the impact of the
application of such change of criterion on the
valuation of its subsidiaries.

The financial statements for the year ended
December 31, 2010 presented for comparative
purposes have been modified as required by
Technical Resolution No. 17. The following is
a detail of the effects of this change in the item
“Retained earnings” of the Company's
Shareholders' equity as of December 31, 2010:

Balances as of December 31, 2009

(48,433,104)

Impact on net income for the year

4,402,400

Balances as of December 31, 2010

(44,030,704)

2.5 Adoption of the International Financial
Reporting Standards (IFRS)
The CNV, through General Resolutions No.
562/09 and 576/10, has provided for the
application of FACPCE Technical Resolutions
No. 26 and 29, which adopted IFRS issued by
the International Accounting Standards Board
(IASB), for entities that are subject to the public
offering regime governed by Law No. 17,811
due to the listing of their shares or notes, and
for entities that have applied for authorization
to be listed under said regime.

Application of these standards shall be
mandatory for the Company as from the fiscal
year beginning January 1, 2012. The first
quarterly financial statements under IFRS shall
be those for the three-month period ended
March 31, 2012.

Therefore, the transition date for the adoption
of the IFRS by the Company, as established in
IFRS No.1 “First-time adoption of the IFRS”,
shall be January 1, 2011.

These financial statements have been prepared
in accordance with General and Particular
Accounting Valuation and Disclosure Standards
required by CNV General Resolutions No.
441/03, 485/05, 487/05 and 494/06, which
differ from IFRS in terms of measurement and
disclosure.

2.5.a) Optional exemptions from IFRS
IFRS No. 1 allows companies adopting IFRS
for the first time to consider certain one-time
exemptions from retrospective application of
certain IFRS applicable to financial statements
as of December 31, 2011. Such exemptions
have been established by IASB in order to
simplify the first application of such standards.

The optional exemptions under IFRS No. 1
applicable to the Company are detailed below:

1. Deemed cost of Property, plant and
equipment: The cost of property, plant and
equipment, adjusted for inflation in accordance
with effective accounting standards, has been

126 127

considered as the deemed cost at the IFRS
transition date, since it is similar to the cost or
depreciated cost under IFRS, adjusted to reflect
the changes of a general or specific price index.

2. Accumulated translation differences of
foreign operations: Accumulated translation
differences related to foreign operations were
considered null at the IFRS transition date.

The Company has not used the other
exemptions available under IFRS No. 1.

2.5.b) Mandatory exceptions to IFRS
The mandatory exceptions to IFRS No. 1
applicable to the Company are detailed below:

2. The other mandatory exceptions provided by
IFRS No. 1 that have not been considered
because they are not applicable to the Company
are the following:
- Derecognition of financial assets and
liabilities.
- Hedge accounting.
- Embedded derivatives.

2.5.c) Mandatory reconciliations
Pursuant to FACPCE Technical Resolutions No.
26 and No. 29, the following is a detail of the
reconciliations of shareholders' equity reported
under NCP ARG to those reported under IFRS
as of December 31, 2011 and January 1, 2011
and the reconciliation of comprehensive income
for the year ended December 31, 2011. In that
respect, in the preparation of reconciliations the
Company has considered those IFRS that it
believes to be applicable to the preparation of its
financial statements as of December 31, 2012.
The items and figures contained in this note are
subject to changes and may only be deemed
final once the Company has prepared the
annual financial statements for the year in
which the IFRS are applied for the first time.

a) Reconciliation of shareholders' equity as of December 31, 2011 and January 1, 2011.

December 31, 2011

January 1, 2011

Shareholders' equity under NCP ARG

3,735,204,430

3,284,857,240

Effect of transition to IFRS:
Adjustment to the valuation of affiliates and goodwill [1]
Total Shareholders' equity under IFRS

(101,062,323)

3,634,142,107

(81,562,035)

3,203,295,205

b) Reconciliation of net income for the year ended December 31, 2011

Net income for the year under NCP ARG (Income)

Effect of transition to IFRS:

Addition of the variation of Cumulative translation adjustment

under NCP ARG to Comprehensive income for the year

Subtotal

Effect in the variation of the Cumulative translation adjustment
due to adjustments to the valuation of affiliates [1]
Effect in income from the adjustments to the valuation of affiliates [1]
Total comprehensive income for the year under IFRS

December 31, 2011

522,279,377

48,067,813

570,347,190

(10,074,876)

(7,526,169)

552,746,145

c) Explanation of reconciling items

[1] Generated by the effect of the adjustments
to shareholders' equity and net income of the
companies in which the Company holds an
equity interest and the effect of the adjustments
to the goodwill of such companies. The
description of the adjustments made to such
companies is disclosed in Note 1.2 to the
consolidated financial statements.

d) Reconciliation of the Statement of Cash
Flows for the year ended on December 31,
2011.

No significant differences have been identified
in the Statement of Cash Flows or in the
definition of Cash and cash equivalents between
NCP ARG and IFRS.

Note 3

Breakdown of the accounts

Balance sheets

a. Cash and banks

Petty cash

Banks - EXHIBIT G

b. Other receivables

Current

Related parties - Note 4

Tax credits

Advances

Other

Non-Current

Net deferred tax assets - Note 6

Guarantee deposits

Other

December 31, 2011

December 31, 2010

59,527

2,891,153

2,950,680

83,218,676

492,599

640,829

761,586

85,113,690

10,352,970

30,000

-
10,382,970

59,327

2,996,632

3,055,959

2,488,645

425,334

914,214

1,212,800

5,040,993

9,744,474

30,000

2,105,600
11,880,074

128 129

c. Accounts payable

Suppliers

Related parties - Note 4

d. Taxes payable

Tax on assets

VAT payable

Other taxes payable

e. Other liabilities

Current

Other

Non-Current

Investment in affiliates - Exhibit C

December 31, 2011

December 31, 2010

2,737,602

289,052

3,026,654

860,197

484,290

1,265,433

2,609,920

13,555,211

25,655,827

1,791,309

1,274,025

3,065,334

151,474

79,327

1,232,317

1,463,118

11,719,705

19,125,902

Statements of Income

Gain / (Loss)

f. Equity in earnings from affiliates and subsidiaries

December 31, 2011

December 31, 2010

SHOSA

Vistone

VLG

CVB

CLC

AGEA

CIMECO

GCSA Investments

ARTEAR

IESA

Radio Mitre

GCGC

CMD
GC Services

Other

175,220,080

124,494,024

33,340,251

29,743,019

7,050,192

80,281,465

7,003,494

(6,529,674)

102,929,943

(988,439)

4,396,061

(5,047,055)

1,887,858
2,922,358

160,305

556,863,882

174,897,711

120,304,959

33,271,400

29,832,678

6,954,591

106,967,939

6,181,463

(5,023,428)

75,013,503

7,459,999

2,356,028

(2,801,063)

(242,071)
8,004,699

2,977,017

566,155,425

Note 4

Balances and transactions with related parties
There follows the breakdown of the
Company's balances with its related parties
as of December 31, 2011 and 2010.

Company

Item

Subsidiaries

Vistone

SHOSA

CVB

CLC

AGEA

ARTEAR

IESA

Radio Mitre

GCGC

Indirectly controlled

Cablevisión

PRIMA

AGR

UNIR

Impripost

Ferias y Exposiciones S.A.

Auto Sports

Long-term debt

Other receivables

Accounts payable

Other receivables

Accounts payable

Other receivables

Accounts payable

Other receivables

Accounts payable

Other receivables

Accounts payable

Other receivables

Accounts payable

Other receivables

December 31,

2011

2010

(44,846,677)

(70,968,174)

(10,299,790)

(1,615,944)

75,303,174

(60,367)

1,412

(166,065)

(29,975)

1,312,190

4,692

(14,457)

(4,629)

(12,726)

4,575,889

(833)

1,157

442,425

128

1,577,609

(23,880,000)

(41,650,700)

(5,711,300)

(918,295)

142,599

(26,618)

(29,975)

1,526,790

4,692

(83,646)

600

(87,372)

(127,186)

523,961

(890)

1,200

(43)

288,675

128

130 131

The following table details the transactions
carried out by the Company with related parties
for the years ended December 31, 2011
and 2010:

Company

Item

December 31,

2011

2010

28,800,000

(5,656)

15,600,000

(17,466)

(3,668,554)

(116,168)

(5,431,890)

(850,779)

240,000

40,041

26,400,000

18,200,000

(81,083)

240,000

5,000

(4,103,627)

(2,683,871)

22,800,000

(258,959)

7,200,000

(5,739)

1,140,000

1,909,987

11,399,667

(191,963)

6,000,000

(83,908)

960,000

(75,049)

(18,521)

Subsidiaries

AGEA

ARTEAR

Vistone

CLC

SHOSA

CVB

Radio Mitre

GCGC

Indirectly controlled

Cablevisión

PRIMA

AGR

Impripost

Auto Sports

CIMECO

UNIR

Management fees

Advertising

Management fees

Interest expense

Services

Interest expense

Management fees

Interest income

Services

Management fees

Services

Management fees

Services

Management fees

Interest expense

Services

Note 5

Additional cash flow statements information
In the years ended on December 31, 2011 and
2010, the following significant transactions were
carried out, which did not have an impact on
consolidated cash and cash equivalents:

Dividends collected through debt settlement

Debt settled through assignment of receivables

Capitalization of receivables held with subsidiaries

73,755,307

875,000

15,633,455

2,025,706

1,115,000

December 31, 2011

December 31, 2010

Note 6

Income tax
The following table shows the breakdown of net
deferred tax assets as of December 31, 2011 and
2010, respectively (amounts stated in thousands
of Argentine Pesos):

Assets

December 31, 2011

December 31, 2010

Tax loss carryforward

Other investments

Salaries and Social Security payable

Other

Subtotal

Valuation allowance for net deferred tax assets - Exhibit E

Net deferred tax assets

28,268

7,645

2,694

38,621

(28,268)

10,353

21,217

7,828

1,916

30,961

(21,217)

9,744

The following table shows the reconciliation
between the income tax and tax on assets
charged to income for the years ended
December 31, 2011 and 2010 and the income
tax liability that would result from applying
the current tax rate on income before taxes
and the income tax and tax on assets liability
assessed for each year (amounts stated in
thousands of Argentine Pesos):

Income tax assessed at the current tax rate (35%)

on income before income tax

Permanent differences:

- Equity in earnings from affiliates and subsidiaries

- Non-taxable income

- Other

Subtotal

Valuation allowance for net deferred tax assets

charged to income - Exhibit E

Income tax charge

Deferred income tax for the year

Income tax charge

Tax on assets

Total

December 31, 2011

December 31, 2010

(183,198)

(188,687)

194,902

(4,447)

403

7,660

(7,051)

609

(1,751)

(1,142)

198,155

(4,230)

580

5,818

(5,377)

441

(1,430)

(989)

132 133

At December 31, 2011, the Company's
accumulated tax losses amount to approximately
Ps. 80.8 million, which calculated at the current
tax rate, represent deferred tax assets in the

amount of approximately Ps. 28.3 million. The
following table shows the expiration date of
the accumulated tax losses pursuant to statutes
of limitations (amounts stated in thousands
of Argentine Pesos):

Expiration year

2012

2013

2014

2015

2016

Note 7

Terms and interest rates of investments, receivables and liabilities

Other investments
Without any established term (1)

Receivables, net (2) (3)
Without any established term

To fall due

- Within three months

Liabilities (3) (4)
Without any established term

To fall due

- Within three months

- More than three months and up to six months

Long-term debt (5)
To fall due

- Within three months

- More than three months and up to six months

(1) Bearing interest at a variable rate.
(2) Do not include Ps. 10,352,970 corresponding
to net deferred tax assets (see Note 6).
(3) Non-interest bearing.
(4) Do not include equity interests in the amount
of Ps. 25,655,827 (see Note 3.e).
(5) Bearing interest at a fixed rate.

Amount of tax loss

carryforward

14,537

11,678

19,023

15,345

20,182

80,765

December 31, 2011

29,866,561

83,889,522

1,254,168

85,143,690

727,373

21,425,400

14,352,443

35,777,843

36,505,216

6,505,671

121,224,914

127,730,585

Note 8

Note 9

Loans
8.1 Financial loans
In May 2004, JPM transferred to the Company
a USD 40 million receivable it held with the
Company's subsidiary Raven, for the payment
of an equivalent amount.

Subsequently the Company, as the only
shareholder of Raven, decided to wind up and
liquidate that company at the Board meeting
held on July 31, 2004.

The remaining balance of the USD 40 million
price payable by the Company to JPM was
refinanced through an agreement between both
parties on May 3, 2004. Such refinancing was
obtained at an interest rate of LIBOR plus a 2%
spread, payable quarterly. Principal was to be
cancelled in annual installments.

During 2006 and 2007, the Company executed
two addenda to such refinancing agreement,
rescheduling the repayment of outstanding
principal. In March 2008, the Company
executed another addendum whereby the
interest rate to be accrued was changed to
LIBOR plus a 3% margin as from March 17,
2008, and LIBOR plus a 4% margin as from
March 17, 2009.

On February 22, 2010, the Company settled
the last installment of the debt mentioned
above, plus accrued interest, accounting for the
full and final discharge of the commitments
undertaken in connection with such debt.

8.2. Other loans
As of December 31, 2011 and 2010, the
Company held financial debts with subsidiaries
in the amount of Ps. 127.7 million and USD
17.9 million, respectively.

Other borrowings
In connection with the transactions carried out
in September 2006 resulting in an increase in
the Company's indirect interest in Cablevisión
to 60%, the Company issued a USD 157.8
million promissory note, with original maturity
on September 26, 2009, accruing interest at 6-
month LIBOR plus a 3.50% spread payable on
a semi-annual basis as from March 26, 2007.
Such maturity could be extended until
September 26, 2010 or September 26, 2011 if
certain conditions were met.

During 2007 and 2008, Grupo Clarín prepaid
principal amounts of USD 29 million and USD
27 million, respectively, plus interest thereon.

During June and October 2009, the Company
agreed with the holder to execute amendments
to the original promissory note, whereby the
conditions to be met for such extensions were
eliminated, modifying the maturity schedule
and establishing a 5.75% margin applicable to
the period running from September 27, 2011
through September 26, 2012.

During 2009 Grupo Clarín made debt
prepayments for an aggregate principal amount
of USD 71.8 million, plus interest thereon.

During 2010, the Company has prepaid in full
the outstanding amount to such date,
accounting for the full and final discharge of the
commitments undertaken in connection with
such debts.

Note 10

Commitments and contingencies
a. Pursuant to a notarial certificate issued on
September 19, 2008, AGEA and the Company
were served with a legal action brought by an
entity representing consumers and alleged
financial victims (and by six other individuals).
Claimants are Multicanal noteholders who

134 135

claim to be allegedly affected by Multicanal's
APE. The claim is grounded on a Consumer
Defense Law which, in general terms, provides
for an ambiguous procedure that is very strict
against the defendant.

The Company, AGEA, certain directors and
members of the supervisory committee, and
shareholders have been served notice of the
claim. After rejecting certain preliminary
defenses presented by the defendants, such as
the application of statutes of limitation and the
failure to comply with prior mediation
procedures, the claim followed ordinary
procedure and the above-mentioned persons
duly filed their respective responses.

b. In July 2009, the Company executed an
agreement securing payment of GCSA
Investments' obligations under its loan, as
detailed in Note 5.4 to the consolidated
financial statements.

c.On September 16, 2010 the Company was
served notice of a legal action brought against it
by Consumidores Financieros Asociación Civil
para su Defensa. The plaintiff claims a
reimbursement of the difference between the
value of the shares of the Company purchased
at their initial public offering and the value of
the shares at the time a decision is rendered in
the case. The Company has duly responded to
the claim and the intervening Court has deemed
the claim responded.

d. In October 2011, the Company executed
agreements securing the payment of certain
financing transactions of one of its subsidiaries
in the amount of USD 2.9 million, effective from
October 2011 to October 2013.

Note 11

Capital and results
11.1. Capital structure
Upon the Company's public offering during
2007, the capital stock amounted to Ps.
287,418,584, represented by:

75,980,304 registered non-endorsable Class A
common shares, with nominal value of Ps. 1
each and entitled to 5 votes per share.

186,281,411 book-entry Class B common
shares, with nominal value of Ps. 1 each and
entitled to 1 vote per share.

25,156,869 registered non-endorsable Class C
common shares, with nominal value of Ps. 1
each and entitled to 1 vote per share.

On October 5 and 11, 2007, the CNV and
BCBA, respectively, granted authorization for
the Company's admission to the initial public
offering of its capital stock. Said authorizations
contemplated (i) the public offering of its Class
B book-entry common shares, (ii) the listing of
its Class B book-entry common shares, and (iii)
the listing of its registered non-endorsable Class
C common shares, trading of which was
suspended due to restrictions on transfers set
forth by the Bylaws. Also in the last quarter of
2007, the Company was granted authorization
for the listing of its GDSs in the LSE. Each
GDS represents two of the Company's Class B
common shares.

11.2. Accumulated Deficit
The Company's bylaws set forth that retained
earnings shall be appropriated as follows: (i) 5%
to the Company's legal reserve until such
reserve equals 20% of the Company's capital
stock; and (ii) the balance, in whole or in part,
to the payment of the fees of the members of
the Board of Directors and the Supervisory
Committee, to dividends on common shares, or
reserve accounts, or as otherwise determined by
the Shareholders, among other situations.

At the Company's Annual Regular Shareholders'
Meeting held on April 22, 2010, the
shareholders decided, among other things, to
appropriate the earnings for the year 2009;
which amounted to Ps. 290,146,539 as follows:
(i) Ps. 14,507,327 to the legal reserve and (ii)
Ps. 275,639,212 to retained earnings.

At the Company's Annual Regular Shareholders'
Meeting held on April 28, 2011, the
shareholders decided, among other things, to
appropriate the earnings for the year 2010;

which at that time amounted to Ps.
533,714,480 as follows: (i) Ps. 26,685,724 to
the legal reserve; (ii) Ps. 120,000,000 to
dividend distribution, which has been paid as of
the date of these financial statements, and (iii)
Ps. 387,028,756 to retained earnings.

On September 1, 2011 the Company was
served with a preliminary injunction in re
“National Social Security Administration v/
Grupo Clarín S.A. on/ ordinary” whereby the
Company may not in any way dispose, in part
or in whole, of the Ps. 387,028,756 currently
recorded under the retained earnings account,
other than to distribute dividends to the
shareholders.

On the same date, the Company was served
with a claim brought by Argentina's National
Social Security Administration requesting the
nullity of the decision made on point 7
(Appropriation of Retained Earnings) of the
agenda of the Annual Regular Shareholders'
Meeting held on April 22, 2010. As of the date
of these financial statements, the Company has
filed a response in due time and form.

On November 1, 2011, the CNV issued
Resolution No. 593, which provides that
shareholders' meetings considering financial
statements must, with respect to retained
earnings that are not subject to restrictions on
distribution and that may be dealt with
pursuant to applicable law, expressly decide
whether to distribute them as dividends, to
capitalize them and issue shares, appropriate
them to set up reserves other than legal reserves,
or a combination of the above.

Note 12

Acquisition and disposal of equity interests
In April 2008, AGEA assigned to the Company
54.5% of its rights and obligations derived from
the call option described in Note 9.1.a to the
consolidated financial statements. On such date,
the Company exercised such call option,
acquiring shares that accounted for 27.3% of
CIMECO's capital stock.

As of the date of these financial statements, the
above transaction is subject to administrative
approvals.

Note 13

Long-term savings plan (PALP)
During the last quarter of 2007, the Company,
together with its subsidiaries, began to
implement a PALP for certain executives
(directors and managers comprising the
“executive payroll”), which became effective in
January 2008. Executives who adhere to such
plan will undertake to contribute regularly a
portion of their salary (variable within a certain
range, at the employee's option) to a fund that
will allow them to strengthen their savings
capacity. Furthermore, each company of the
Group where such executives render services will
match the sum contributed by such executives.
This matching contribution will be added to the
fund raised by the employees. Under certain
conditions, the employees may access such
funds upon retirement or upon termination of
their jobs with the Group.

Likewise, the PALP provides for certain special
conditions for those managers who were in the
“executive payroll” before January 1, 2007. Such
conditions consist of supplementary
contributions made by each company to the
PALP related to the executive's years of service
with the Group. As of December 31, 2011,
such supplementary contributions made by the
Company on an individual and consolidated
basis amount to approximately Ps. 10 million
and Ps. 36 million, respectively, and the charge
to income is deferred until the retirement of
each executive.

Pursuant to Technical Resolution No. 23, the
above-mentioned savings plan qualifies as a
Defined Contribution Plan, which means that
the companies' contributions shall be charged to
income on a monthly basis as from the date the
plan becomes effective.

136 137

Note 14

Derivatives
The Company enters into derivative contracts
for the sole purpose of securing the future cash
flows of its fixed-rate and/or USD-denominated
debt. Grupo Clarín does not enter into
derivative contracts for speculative purposes.

As of December 31, 2011 and 2010 the
Company had no outstanding balances related
to derivatives.

The transactions related to derivatives generated
a net loss of Ps. 0.4 million for the year ended
December 31, 2010.

Note 15

Regulatory framework for broadcasting services
The Audiovisual Communication Services Law
(Law No. 26,522) was passed and enacted on
October 10, 2009, subject to strong concerns
over its content and enactment procedure. Even
though the new Law became effective on
October 19, 2009, not all of the implementing
regulations provided by the law have been
enacted. Therefore, Law No 22,285 still applies
to those matters which have not been regulated
to date, until all terms and procedures for the
regulation of the new law have been defined.

The law provides for the replacement of the
COMFER with the Audiovisual
Communication Services Law Federal
Enforcement Authority (AFSCA, for its Spanish
acronym), as a decentralized and autocratic
agency under the jurisdiction of the Executive
Branch, and vests the new agency with authority
to enforce the law. It may be argued that, as of
the date of these financial statements, AFSCA
has not yet been fully formed and, therefore, its
functioning is still questionable.

The new law, which governs the audiovisual
communication services activities conducted by
the Company through its subsidiaries,
establishes, among other things,:
- A license award and review scheme that grants
wide discretion to the Executive Branch and to
an Enforcement Authority with questionable

composition and powers;
- A 10-year limitation to the terms of licenses,
with a one-time non-renewable extension.
- The non-transferability of authorizations and
licenses, and a regulatory framework and
registration requirements for signals, production
companies and advertising agencies;
- A multiple license scheme which: i) restricts to
10 the number of Audiovisual Communication
Services licenses plus a single broadcasting signal
for radio, broadcast TV and subscription cable
TV services that make use of the radio
spectrum; ii) restricts the licensing of
subscription broadcasting services rendered by
means of a physical link (cable), limiting the
number of licenses to 24; iii) sets forth a further
restriction on these services, which may not be
provided to more than 35% of all inhabitants or
subscribers nationwide; iv) establishes that a
broadcast TV signal and a cable TV signal may
not be simultaneously exploited in the same
location, and v) establishes that broadcast TV
networks may only own one cable TV signal.
The same applies to cable TV networks, which
may only own the so-called “local channel”,
which is mandatory for every license;
- Mandatory quotas for certain types of content.

Also controversially, the law sets forth
retroactive effects by requiring holders of
current broadcasting licenses - which were
legitimately acquired rights under Law No.
22,285 as amended - to conform to the new law
within the term of one year counted as from the
time certain mechanisms required for
implementation are set in place.

It is publicly known that the main entities of
the audiovisual media industry as well as
industry players, legal scholars and experts have
expressed several concerns about this law, since
they consider that it has defects that render it
unconstitutional; it seriously damages the
development of the audiovisual industry and it
restricts fundamental freedoms. Some of these
industry players, such as provincial governments
and political parties, as well as private entities
including the Company and its main
subsidiaries, have already made court filings in
this sense. As of the date of these financial
statements, insofar as the Company is
concerned, two court decisions are in full force
and effect providing for: (i) the provisional
suspension of section 161 of the Audiovisual

Communication Services Law with respect to
Grupo Clarín and other subsidiaries, which has
been confirmed by the Supreme Court of
Argentina, and (ii) at the request of the
Consumer Defense Committee, the suspension
of the application of sections 45, 161 and 62
through 65 of such Law. Even though this
decision has been partially revoked by the
Federal Court of Appeals of Salta, the Court of
Appeals' decision may be deemed not to be final
since the affected party filed an extraordinary
appeal, thereby restoring the effects of the
decision rendered in the first instance.

Most sections of the Law No. 26,522 were
regulated by means of Decree No 1,225/2010.
However, there are still some issues that need to
be clarified for the law's practical application.

The unreasonableness and arbitrariness of some
of these measures may result in the declaration
of unconstitutionality in the future. In fact,
some industry chambers have already resorted to
the courts to complain against the abuses in the
regulation. These include: i) the provisions on
required content and mandatory production
quotas, ii) the mandatory national film screen
and audiovisual art quota, iii) the prior
authorization required to create programming
networks, iv) the expensive access systems and
the time granted for their implementation and
v) some issues related to advertising sales and
their quotas, among other important issues.

Also of note is the highly discretional
mandatory divestiture system provided for in
the regulations to Section 50 of the Audiovisual
Communication Services Law, which has
evident confiscatory effects.

The Company and its subsidiaries are evaluating
the possible effects on their business of such
questioned Audiovisual Communication
Services Law, its implementing regulations and
the matters mentioned above. Therefore, this
situation creates a framework of uncertainty
about the Company's business. Depending on

several aspects, the Company and/or some of its
subsidiaries could be forced to divest of certain
services, which shall in turn depend on the
choices made by the Company and/or some of
its subsidiaries. All of the above could result in a
reduction of the services the Company currently
renders, the ownership and rights of which were
acquired in compliance with Law 22,285.
Therefore, at present this situation generates
uncertainties about the business of the
Company and its subsidiaries, which could
significantly affect the recoverability of the
Company's relevant assets (on a parent
company only and consolidated basis).
However, the recoverability of such assets could
be unaffected if the Company's and other
parties' main arguments were adopted to create
a framework of increased rationality, either by
the amendment, repeal or declaration of
unconstitutionality of the new media law and/or
its implementing regulations.

The Company and its legal advisors consider
that this Audiovisual Communication Services
law and its implementing regulations violate
fundamental constitutional rights, such as, the
property right and freedom of the press, among
others. For this reason, it will bring the legal
actions in each instance to safeguard its rights
and those of its shareholders; as well as to
protect the fundamental principles infringed by
such law.

The decisions to be made based on these
financial statements should contemplate the
eventual impact these changes in the regulatory
framework may have on the Company and its
subsidiaries. The parent only and the
consolidated financial statements of the
Company should be read in the light of this
uncertain environment.

In order to properly understand this note, the
Company's management recommends that it be
read together with Note 11 to the consolidated
financial statements.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

138 139

Property, Plant and
Equipment, net

As of December 31, 2011
and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Exhibit A

Main account

of the year

Increases

Retirements

At year-end

At the beginning

Historical value

Furniture and fixtures

Audio and video equipment

Telecommunication equipment

Computer equipment and software

Total as of December 31, 2011

Total as of December 31, 2010

282,845

118,159

98,280

3,980,149

4,479,433

3,968,211

69,749

4,020

5,460

387,534

466,763

515,465

4,243

352,594

122,179

103,740

4,367,683

4,946,196

4,479,433

At the beginning

of the year

117,069

62,481

46,772

3,241,400

3,467,722

2,727,635

Rate

For the year

Retirements

At year-end

December 31, 2011

December 31, 2010

Depreciation

Net book value

as of

10%

20%

33%

30,360

19,408

13,238

496,049

559,055

744,330

4,243

147,429

81,889

60,010

3,737,449

4,026,777

3,467,722

205,165

40,290

43,730

630,234

919,419

165,776

55,678

51,508

738,749

1,011,711

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

140 141

Investments

Exhibit C

Equity interest in

other affiliates

As of December 31,
2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Long-term investments

Type of shares

Number

Par value

Cost value

(1) Book value

Common

123,341,081

Ps. 1.00

482,455,860

SHOSA

Goodwill

Vistone

VLG

Goodwill

CVB

CLC

Pem S.A.

AGEA

AGR

CIMECO

Goodwill

CMI

ARTEAR

IESA

Radio Mitre

GC Services

GCGC

CMD

GC Minor

Total as of December 31, 2011

Total as of December 31, 2010

Common

322,528,386

Common

63,298,286

19,188,422

141,199,126

1,254,128

37,412,958

53,186,347

12,454

27,475,368

15,605,979

58,595,147

3,022,008

Ps. 1.00

753,588,623

506,093,000

844,744,176

127,843,913

102,604,232

188,466,797

50,437,318

320,638,946

97,947,290

57,766,258

19,191,422

539,522,170

600,422,237

2,644,874

79,997,244

45,449

152,243,761

48,085,768

77,695,113

19,038,342

16,512,381

112,025,302

3,470,803

1,483,465

32,457,452

58,837,707

137,246

334,638,791

102,719,136

35,433,452

9,840,619

7,810,923

32,382,979

5,920,670

2,029,280,984

3,795,862,738

2,023,229,184

3,370,483,445

Other non-current liabilities

Cost value

Book value

GCSA Investments

Total as of December 31, 2011

Total as of December 31, 2010

(1) In certain cases, the equity value does not
correspond to the related shareholders' equity due to:
(i) the adjustment of the equity value to the
Company's accounting policies, as required by
professional accounting standards, (ii) the elimination
of goodwill generated by transactions between
companies under the Company's common control,
(iii) the existence of irrevocable contributions, and (iv)
adjustments to fair market value of net assets for
acquisitions made by the Company.

304

25,655,827

19,125,902

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Exhibit C (CONTINUED)

Long-term investments

SHOSA

Vistone

VLG

CVB

CLC

Pem S.A.

AGEA

AGR

CIMECO

CMI

Main business activity

Investing and financing

Investing

Investing and financing

Investing

Printing and Publishing

Graphic press

Investing and financing

Advertising

GCSA Investments

Investing and financing

ARTEAR

IESA

Radio Mitre

GCGC

CMD

GC Services

GC Minor

Broadcasting services

Investing and financing

Broadcasting services

Services

Investing and financing

(1) % in votes amounts to 98.8%.

As per financial statements as of December 31, 2011

Issuer's information

Direct interest

in capital

and votes

Income /

(Loss)

Shareholders'

Capital

for the year

equity

97.0%

95.0%

11.0%

95.0%

99.9%

0.1%

99.9%

0.9%

20.7%

0.8%

100.0%
(1) 97.0%
96.9%

94.7%

97.5%

84.6%

100.0%

95.0%

127,153,997

339,365,203

66,628,353

19,189,422

13,558,511

141,199,151

138,865,295

180,479,453

12,000

54,859,553

12,857

29,018,383

16,006,285

69,295,301

3,181,079

212,389,381

147,494,532

356,289,380

35,330,084

3,066,629

3,490,056

82,864,514

14,779,286

42,801,943

4,481,332

(8,234,007)

105,998,066

(1,044,393)

4,641,497

(4,685,223)

1,031,637

2,922,358

14,079

1,149,237,594

811,170,491

1,856,459,720

178,830,760

25,519,987

26,104,546

624,184,800

175,609,525

276,667,036

16,805,783

(29,981,424)

351,049,391

106,870,914

37,181,646

8,011,280

85,668,592

9,840,619

6,259,276

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

142 143

Other Investments

Exhibit D

As of December 31, 2011
and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Allowances
and Provisions

As of December 31, 2011
and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Main account and securities characteristics

Book value as of

December 31, 2011

December 31, 2010

Other current investments:

Financial instruments - Exhibit G

Money Market - Exhibit G

Total

Exhibit E

500,593

29,365,968

6,730,099

6,909,143

29,866,561

13,639,242

Balance at

the beginning

Balances as of

December 31,

of the year

Increases

Decreases

2011

2010

Deducted from

non-current assets

Other receivables

Valuation allowance for

net deferred tax assets

21,217,356

(1) 7,050,577

28,267,933

21,217,356

Valuation allowance for

Tax on assets

Short-term Investments

32,470,574

(1) 1,751,439

2,916,114

31,305,899

32,470,574

For goodwill impairment

28,432,495

Total as of

December 31, 2011

82,120,425

8,802,016

2,916,114

88,006,327

Total as of

December 31, 2010

80,612,320

6,806,933

5,298,828

82,120,425

(1) Charged to Income tax and Tax on assets.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

Foreign Currency
Assets and Liabilities

Exhibit G

As of December 31, 2011
and 2010

Amount in

Ps. as of

Amount in

Ps. as of

Foreign currency

Effective

December 31,

type and amount

exchange rate

2011

2010

Assets

Current assets

Bank accounts

Other investments

- Financial instruments

- Money Market

Total current assets

Total assets

Liabilities

Current liabilities

Long-term debt

Total current liabilities

Total liabilities

USD: United States dollars

USD

39,179

117,510

6,893,420

4.26

USD

166,904

287,959

500,593

29,365,968

30,033,465

474,809

6,909,143

7,671,911

30,033,465

7,671,911

71,242,000

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

144 145

Information required
under Section 64,
Subsection b) of
Law No. 19,550

For the years ended
December 31, 2011 and 2010
In Argentine Pesos (Ps.) -
Note 2.1

Exhibit H

Item

Salaries, Social Security and benefits to personnel (1)
Supervisory Committee's fees

Fees for services(2)

Taxes, duties and contributions

Other personnel expenses

General expenses

IT expenses

Maintenance expenses

Communication expenses

Advertising expenses

Travel expenses

Stationery and office supplies

Other expenses

Administrative expenses

December 31, 2011

December 31, 2010

52,683,078

195,000

17,138,361

3,378,725

706,914

92,730

276,936

947,768

514,447

705,553

2,314,133

47,706

3,402,002

40,801,930

177,000

13,479,548

2,337,085

540,795

77,940

211,326

556,340

448,938

467,564

2,089,339

104,883

2,598,943

Total

82,403,353

63,891,631

(1) Includes fees for technical and administrative
services to Directors of Ps. 6,925,658 and Ps.
5,458,238, respectively. Additionally, they include the
effect of the long-term savings plan mentioned in
Note 13.

(2) Includes Directors' fees in the amount of Ps.
861,112 and Ps. 691,111, respectively.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

SUPPLEMENTARY
FINANCIAL
INFORMATION

146 147

Supplementary
Financial
Information

As of December 31, 2011

the launch of new collectible and optional
products, such as, the newspaper MUY launched
in May 2011. Additionally, in October Grupo
Clarín, through one of its subsidiaries, acquired
65.46% of the retail bookstore chain Cúspide.

In the Broadcasting and Programming segment,
Canal 13 has been consolidating its leadership
in audience share since May 2011. This
leading position is mostly attributable to the
outstanding performance of its programming
grid both during the Prime Time (ShowMatch,
“Herederos de una Venganza”, “Los Únicos”
and “El Puntero”), as well as during other
times, with good results for the afternoon and
weekend programs, such as “Sábado Show”
and “Cantando 2011”.

In the Cable Television and Internet Access
segment, the Company focused on subscriber
loyalty initiatives and on the expansion of its
Cablevisión HD and broadband Internet
access subscriber base. During the year, Fibertel
launched a 30 Mbps high-speed connectivity
product, the only one in the market. Progress
was also made in the optimization of the reach
of digital and premium services to cities and
towns in the provinces.

1. Company’s activities

Grupo Clarín is the most prominent and
diversified media group in Argentina and one
of the most important in the Spanish-speaking
world. It has presence in the printed media,
radio, broadcast and cable television, audiovisual
content production, the printing industry and
Internet. Its leadership in the different media
is a competitive advantage that enables Grupo
Clarín to generate significant synergies
and expand into new markets. Its activities are
grouped into four main segments: Cable
television and Internet access, Printing and
publishing, Broadcasting and Programming,
and Digital content and other.

The Company carried out its activities in the
challenging context faced as a consequence
of constant harassment of the media in general
and, specifically, Grupo Clarín. Among the
main activities carried out during the year, the
following were the most significant:

In the Printing and Publishing segment, during
the year, the Company continued to publish its
traditional newspapers and magazines, focusing
on strengthening its editorial offering through

2. Consolidated balance sheet structure

Note: the amounts are rounded up and stated in
thousands of Argentine Pesos. The figures under
total amounts may not represent the exact
arithmetic sum of the other figures in the table.

December 31,

2011

December 31,
(1) 2010

December 31,
(1) 2009

December 31,
(1) 2008

December 31,
(1) 2007

2,983,660
7,701,697

10,685,358

2,619,262

3,293,490

5,912,752

1,037,401

3,735,204

2,279,872
6,656,126

8,935,998

2,071,184

2,661,478

4,732,662

918,479

3,284,857

1,792,060
6,298,815

8,090,874

1,771,635

2,896,235

4,667,871

690,717

2,732,286

1,680,433
6,214,018

7,894,451

1,801,713

3,170,281

4,971,994

520,775

2,401,683

1,493,484
5,518,698

7,012,181

1,275,319

3,163,195

4,438,514

404,164

2,169,503

10,685,358

8,935,998

8,090,874

7,894,451

7,012,181

Current assets
Non-current assets

Total assets

Current liabilities

Non-current liabilities

Total liabilities

Minority interest

Shareholders' equity

Total liabilities,
minority interest and

shareholders' equity

(1) Includes the changes to the balances in order to
comply with CNV Resolution No. 576/2010, as
mentioned in Note 2.4 to the parent company only
financial statements.

3. Consolidated income (loss) structure

Note: the amounts are rounded up and stated
in thousands of Argentine Pesos. The figures
under total amounts may not represent the exact
arithmetic sum of the other figures in the table.

December 31,

2011

December 31,
(1) 2010

December 31,
(1) 2009

December 31,
(1) 2008

December 31,
(1) 2007

Operating income

before depreciation

and amortization (2)

Depreciation

and amortization

Financing and

holding results

Equity in earnings

from unconsolidated

affiliates, net

Other income

(expense), net

Income before income

tax, tax on assets

and minority interest

Income tax and

tax on assets

Minority interest

Net income for the year

2,598,651

2,351,839

1,985,663

1,674,643

1,350,807

(786,523)

(619,184)

(603,103)

(484,068)

(417,629)

(592,850)

(420,315)

(617,569)

(517,173)

(448,336)

16,665

4,071

16,332

9,284

7,218

7,724

(7,501)

(2,282)

(16,628)

(21,421)

1,243,667

1,308,909

779,041

666,057

470,639

(454,235)

(267,152)

522,279

(493,432)

(277,360)

538,117

(298,508)

(180,879)

299,654

(286,597)

(107,396)

272,064

(178,030)

(66,957)

225,652

(1) Includes the changes to the balances in order to
comply with CNV Resolution No. 576/2010, as
mentioned in Note 2.4 to the parent company only
financial statements.
(2) Defined as net sales minus cost of sales (excluding
depreciation and amortization) and minus expenses
(excluding depreciation and amortization).

148 149

4. Statistical data

December 31,

2011

2010

2009

2008

2007

Cable TV subscribers (1)
Cable TV homes passed (2)
Cable TV churn ratio
Internet access subscribers (1)
Newspaper circulation (3)
Canal 13 audience share
Prime Time (4)
Total Time (4)

3,490,320

7,586,506

15.1

1,351,107

331,238

42.2

33.0

3,357,853

7,485,595

14.3

1,128,171

360,816

42.2

31.0

3,192,950

7,457,043

15.8

988,031

394,796

40.1

29.7

3,190,570

6,753,590

15.3

938,767

431,098

43.3

33.5

3,022,344

6,753,590

13.2

757,116

442,861

42.4

34.5

(1) Includes companies controlled, directly and
indirectly, by Cablevisión (Argentina, Uruguay and
Paraguay).
(2) Contemplates the elimination of the overlapping
of networks between Cablevisión and subsidiaries
(including Multicanal and Teledigital).
(3) Average quantity of newspapers per day (Diario
Clarín and Olé), pursuant to the Instituto Verificador
de Circulaciones (this figure represents sales in
Argentina and abroad).
(4) Share of prime time audience of broadcast
television stations in the Metropolitan Area of Buenos
Aires, as reported by IBOPE. Prime time is defined as
8:00 PM to 12:00 AM, Monday through Friday. Total
time is defined as 12:00 PM to 12:00 AM, Monday
through Sunday.

5. Ratios

Liquidity

(current assets /

current liabilities)

Solvency (shareholders'
equity/ total liabilities)

Capital assets

(non-current assets /

total assets)

Profitability (Net Income

for the year/ average

shareholders' equity)

December 31,

2011

2010

2009

2008

2007

1.14

0.63

0.72

0.15

1.10

0.69

0.74

0.18

1.01

0.59

0.78

0.12

0.93

0.48

0.79

0.12

1.17

0.49

0.79

0.12

6. Outlook

Grupo Clarín's corporate strategy is aimed at
consolidating its presence in the local and
regional market, strengthening its presence in
the traditional media, with a growing focus on
digital media and in the production and in the
distribution of content.

Among its initiatives, the Company seeks to
leverage its positioning in the Argentine
industry and its vast knowledge of the media
consumer to strengthen and develop its current
businesses. One of its main objectives is to
boost its cable television and Internet access
services by leveraging its strong presence in
distribution networks, the strength of its brands
and, above all, its vast experience in content
production.

In a framework of continued hostility against
the media, the Company remains committed to
informing with independence, to reaching all
sectors of society and to supporting the quality
and credibility values of its media. It will assess
the implications of the laws related to its
activities; while bringing the pertinent legal
actions to safeguard its rights and those of its
readers, audiences and clients.

Whatever the context, the Company will
continue to assess eventual opportunities for

growth in the local and international market
that may increase value for its shareholders and
conform to its business strategy.

The Company will keep focusing on the core
processes that allow for a sustainable and
efficient growth from different perspectives:
financial structure, management control,
business strategy, human resources, innovation
and corporate social responsibility.

7. Progress made on the compliance with

the implementation of the IFRS

On April 29, 2010, the Company's Board of
Directors has approved the IFRS
implementation plan. As of the date of these
financial statements, the Company has not
learnt of any circumstance that may require any
changes to such plan or that may indicate an
eventual departure from the objectives and dates
established in such plan.

Note 1.2 to the consolidated financial
statements and Note 2.5 to the parent company
only financial statements disclose the
information about reconciliation between
effective Argentine professional accounting
standards and IFRS, which is required by
Technical Resolution No. 26 (amended by
Technical Resolution No. 29).

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

150 151

Additional Information
to the Notes to the
Financial Statements -
Section No. 68 of
the Regulations issued
by the Buenos Aires
Stock Exchange

Balance Sheet as of
December 31, 2011

1) There are no specific material regulatory
regimes currently applicable to the Company
that may entail the contingent loss or
acquisition of legal benefits.

4) Classification of receivables and liabilities
according to their related financial effects is
detailed in Note 7 to the parent company only
financial statements and in Exhibit G thereof.

2) As mentioned in Note 12 to the parent
company only financial statements, during 2008
the Company carried out transactions that
resulted in the acquisition of an equity interest
in CIMECO.

3) Classification of receivables and liabilities is
detailed in Note 7 to the parent company only
financial statements.

5) Equity interest under Section 33 of Law No.
19,550 is detailed in Exhibit C of the parent
company only financial statements. Accounts
receivable from and payable to related parties
are disclosed under Note 4 to the parent
company only financial statements. The
following table summarizes the breakdown of
such accounts payable and receivable as per the
above points 3) and 4).

Without any established term

To fall due

-Within three months

- More than three months and up to six months

Receivables

(1) 83,218,676

Liabilities

(1) 289,052

(1) 6,505,671
(2) 121,224,914

Total

83,218,676

128,019,637

(1) The balances are denominated in local currency
and do not accrue any interest.
(2) The balances are denominated in local currency
and accrue interest at a fixed rate.

6) There are no trade receivables or loans to
directors, members of the Supervisory
Committee and their relatives up to, and
including, the second degree of kinship and no
such trade receivables or loans existed during
the fiscal year.

7) The Company does not have any inventories.

8) The Company has used current values for
the valuation of assets and liabilities acquired
from Cablevisión, taking into account, mainly,
the following criteria:

- Subscriber portfolio: valued based on, among
other things, an analysis of the acquired
subscriber portfolio's cash flow generation,
considering the subscriber turnover of such
portfolio, discounted at a market rate.

- Financial debt: since the acquired companies
were not listed at the time of the acquisition,
the financial debt was valued based on cash flow
discounted at a market rate.

- Fixed assets: valued based on internal estimates
made by the subsidiaries according to available
information (kilometers and technical
characteristics of the network, replacement value
per kilometer and type of network based on
business knowledge and purchase price of the
resources needed, state of the network at the
time of acquisition, real estate appraisals of the
most significant real property, among others).

Similarly, the Company has recorded the net
acquired assets of CIMECO at fair value.

9) The Company does not have any property,
plant and equipment subject to appraisal write-
up.

10) The Company does not have any obsolete
property, plant and equipment.

11) The Company is not subject to the
restrictions under section 31 of Law No.
19,550, since its main corporate purposes are
investment and finance.

investments for which the Company does not
book goodwill with an indefinite useful life, it
assesses their recoverable value when there is any
indication of impairment. In the case of
investments for which the Company books
goodwill with an indefinite useful life, it assesses
their recoverable value by comparing the book
value with cash flows discounted at the
corresponding discount rate, considering the
weighted average capital cost, and taking into
consideration the projected performance of the
main operating variables of the respective
companies.

13) As of December 31, 2011, the Company
does not have any relevant tangible property,
plant and equipment requiring efficient
insurance coverage.

14) Booked provisions for contingencies do not
exceed, either individually or as a whole, two
percent (2%) of its shareholders' equity.

15) As of the date of these financial statements,
the Company does not have any contingent
situations, the financial effects of which, if any,
have not been booked (see Note 15 to the
parent company only financial statements).

16) The Company does not have any
irrevocable contributions on account of future
share subscriptions.

17) The Company does not have any unpaid
cumulative dividends on preferred shares.

12) The Company assesses the recoverable value
of its long-term investments each time it
prepares its financial statements. In the case of

18) Note 11.2 to the parent company only
financial statements explain the treatment given
to retained earnings.

Signed for identification purposes
with the report dated March 09, 2012
Price Waterhouse & Co. S.R.L.
C.P.C.E.C.A.B.A. VOL. 1 - FOL. 17

Carlos Alberto Pedro Di Candia
Chairman of the Supervisory Committee

Dr. Carlos A. Pace (Partner)
Certified Public Accountant (U.B.A.)
C.P.C.E.C.A.B.A. VOL. 150 - FOL. 106

Héctor Horacio Magnetto
Chairman

152 153

Report
of Independent
Accountants

Free translation from
the original
prepared in Spanish

To the Shareholders, President

and Directors of Grupo Clarín S.A.

Legal domicile: Piedras 1743

Autonomous City of Buenos Aires

CUIT No. 30-70700173-5

1. We have audited the balance sheet of Grupo
Clarín S.A. at December 31, 2011, and the
related statements of income, of changes in
shareholders' equity and of cash flows for the
year then ended and complementary Notes 1 to
15 and Exhibits A, C, D, E, G and H.
Furthermore, we have examined the
consolidated financial statements of Grupo
Clarín S.A. with its subsidiaries, for the year
ended December 31, 2011, which are presented
as complementary information. The preparation
and issuance of these financial statements are
the responsibility of the Company. Our
responsibility is to express an opinion on the
financial statements based on our audits.

2. Except for the matter described in point 6.,
we conducted our audits in accordance with
auditing standards in effect in Argentina. Those
standards require that we plan and perform the
audit to obtain reasonable assurance about
whether the financial statements are free of
material misstatement and to form an opinion
about the reasonableness of the relevant
information contained in the financial
statements. An audit includes examining, on a
test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit
also includes assessing the accounting principles
used and significant estimates made by
management, as well as evaluating the overall
financial statement presentation. We believe that
our audits provide a reasonable basis for our
opinion.

3. On October 10, 2009, Audiovisual
Communication Services Law 26,522 (the
“Law”) was enacted which repeals Broadcasting
Law 22,285 under which the Company
provides audiovisual communication services
through its subsidiaries.

As mentioned in Note 15 to the parent-only
financial statements and in Note 11 to the
consolidated financial statements, the Company
and certain subsidiaries are analyzing the
possible consequences that could be derived
from the change of regulatory framework on
their business. As indicated in Note 15 to the
parent-only financial statements, the Company
is bringing and will bring all legal actions
corresponding to each instance to safeguard its
rights and those of its shareholders.

Accordingly, there is uncertainty as to the effect
that this change in the regulatory framework
and the outcome of the legal actions being
brought by the Company could have on the
activities of the economic group and, therefore,
on its financial statements taken as a whole.

4. As mentioned in Notes 8.2.b, 8.2.c. and
8.2.i. to the consolidated financial statements,
since September 2009, the Federal Broadcasting
Committee, the National Antitrust
Commission, the Secretariat of Domestic Trade
(“SCI”, for its Spanish acronym), the Argentine
Secretariat of Communications and the
Ministry of Economy and Public Finance have
issued several resolutions on matters related to:
(i) the acquisition of Cablevisión S.A.,
Multicanal S.A. and other companies, and their
subsequent merger, and (ii) the revocation of
the license that had been originally granted to

FIBERTEL S.A. In addition, as indicated in
Note 8.2.m to the consolidated financial
statements, the subsidiary Cablevision was
served with a preliminary injunction granted to
a third party ordering the separation of the
assets, liabilities and businesses that used to
belong of Multicanal S.A. and that were
subsequently merged into Cablevision and the
appointment of a court-appointed supervisor
(interventor) and co-administrator. As indicated
in the above-mentioned Notes, the subsidiary
Cablevisión has brought legal actions as it
considered appropriate.

Accordingly, there is uncertainty regarding the
effect of the final resolution of these situations
mentioned on subsidiary Cablevisión S.A.
business and, therefore, on the financial
statements of the company taken as a whole.

5. As mentioned in Note 8.2.g. to the
consolidated financial statements, on March 3,
2010 the Secretariat of Domestic Trade (“SCI”)
issued Resolution 50/10 establishing a formula
for calculation of the monthly subscription price
to be paid by the users of pay-television services.
As indicated in the same Note, on March 10,
2011 SCI Resolution No. 36/11 was published
in the Official Gazette establishing the
parameters to be applied to the services rendered
by Cablevisión. On May 2, June 30, August 31,
October 31 and December 29, 2011, the SCI
extended the term of Resolution No. 36/11
until March 2012.

As indicated in that Note, the subsidiary
Cablevisión filed the corresponding
administrative claims and will bring the
necessary legal actions requesting the suspension
of the effects and the eventual annulment of
those resolutions.

Accordingly, there is uncertainty as to the effect
that the outcome of the situation could have on
the subsidiary Cablevisión and its subsidiaries'
business and, therefore, on the recoverability of
its assets.

6. As mentioned in Note 1 to the consolidated
financial statements, Papel Prensa S.A.I.C.F. y
de M. has not issued or approved its financial
statements as of December 31, 2011. To
calculate the equity value of its investment in
Papel Prensa, the Company has relied on the
financial statements as of September 30, 2011,
approved by Papel Prensa's Board of Directors,
which have been subject to limited review by its
auditors, and on an estimate made by the
Company of the results of the October-
December 2011 quarter. This situation is not in
accordance with the professional accounting
standards in force, which require that the
financial statements used to apply the equity
method have an auditor's report issued by an
independent certified public accountant.
Additionally, and in view of the above-described
situation, we were not able either to perform the
necessary audit procedures aimed at conforming
to the reasonableness of the information, used
by the Company to calculate the equity value of
its investment. The Company's investment in
Papel Prensa disclosed in the consolidated
financial statements as of December 31, 2011
amounts to Ps. 194,029,432.

7. As indicated in Note 1.2 to the consolidated
financial statements and in Note 2.5 to the
parent-only financial statements, the items and
figures contained in the reconciliations included
in those Notes, may be subject to changes and
may only be deemed final when the annual
financial statements have been prepared for the
year in which the IFRS are adopted for the first

154 155

time. These reconciliations are also affected by
the situation described in point 6.

8. In our opinion, except for the effect on the
financial statement of potential adjustments, if
any, that might result from not having had the
scope limitation of our work and the deviation
from professional accounting standards as
indicated in point 6., and subject to the effect
on these financial statements of potential
adjustments and/or reclassifications, if any, that
might be required as a result of the resolution of
the uncertainties described in points 3., 4. and
5.:

a) The financial statements of Grupo Clarín
S.A. present fairly, in all material respects, its
financial position at December 31, 2011, the
results of its operations, the changes in its
shareholders' equity and its cash flows for the
year then ended, in conformity with
professional accounting standards in effect in
the Autonomous City of Buenos Aires;

b) The consolidated financial statements of
Grupo Clarín S.A. with its subsidiaries present
fairly, in all material respects, its consolidated
financial position at December 31, 2011, the
consolidated results of its operations and its
consolidated cash flows for the year then ended,
in conformity with professional accounting
standards in effect in the Autonomous City of
Buenos Aires.

9. The financial statements of the Company as
of December 31, 2010 were audited by us, on
which we have issued an opinion, dated March
10, 2011, with qualifications similar to those
mentioned in points 3., 4., 5. and 6. The
corresponding figures for the year were adequate
according to the change in accounting criteria

described in Note 2.4 to the parent-only
financial statements and Note 1.3 to the
consolidated financial statements, which we
share to be coincident with professional
accounting standards in effect in the
Autonomous City of Buenos Aires. The effects
of the change of criteria are shown in the same
Notes.

10. In accordance with current regulations, we
report that:

a) The financial statements of Grupo Clarín S.A
and its consolidated financial statements have
been transcribed to the “Inventory and Balance
Sheet” book and comply with the Corporations
Law and pertinent resolutions of the Argentine
Securities Commission, as regards those matters
that are within our competence;

b) The financial statements of Grupo Clarín
S.A. arise from accounting records kept in all
formal respects in conformity with legal
provisions which maintain the security and
integrity conditions based on which they were
authorized by the Argentine Securities
Commission;

c) We have read the supplementary financial
information and the additional information to
the Notes to the financial statements required
by section 68 of the listing regulations of the
Buenos Aires Stock Exchange, on which, as
regards those matters that are within our
competence, we have no observations to make
other than those already stated in points 3., 4.,
5. and 6.;

d) At December 31, 2011, the debt accrued in
favor of the (Argentine) Integrated Social
Security System according to the Company's

accounting records and calculations amounted
to $874,056, none of which was claimable at
that date;

e) In accordance with section 4 of General
Resolution No. 400 issued by the Argentine
Securities Commission, amending section 18
subsection e) of the title III.9.1 of the Rules of
such Commission, we inform that the total of
fees for audit and related services invoiced to the
Company for the year ended December 31,
2011, represent:

e.1) 99% on the total fees for services invoiced
to the Company for all concepts in that year;

e.2) 12% on the total fees for audit and related
services invoiced to the Company, its parent
companies, subsidiaries and affiliates in that
year;

e.3) 11% on the total fees for services invoiced
to the Company, its parent companies,
subsidiaries and affiliates for all concepts in that
year.

f ) We have applied the procedures on
prevention of asset laundering and terrorism
funding set forth in the relevant professional
rules issued by the Professional Council for
Economic Sciences of the Autonomous City of
Buenos Aires.

Autonomous City of Buenos Aires,
March 9, 2012

Price Waterhouse & Co. S.R.L.

Dr. Carlos A. Pace (Partner)

156 157

Supervisory
Committee’s
Report

To the Shareholders of

Grupo Clarín S.A.

In our capacity as members of Grupo Clarín S.A.'s
Supervisory Committee and pursuant to subsection
5, section 294 of the Argentine Business
Associations Law No. 19.550, we have performed a
review of the documents mentioned in Section I
below, within the scope set forth in Section II
below. The preparation and issuance of the
documents referred to above are the responsibility
of the Company's Board of Directors, in exercise of
its exclusive duties. Our responsibility is to report
on such documents, based on the work performed
within the scope set forth in II.

I. Documents subject to review
a) Balance Sheet as of December 31, 2011.
b) Statement of Income for the year ended
December 31, 2011.
c) Statement of Changes in Shareholders' Equity
for the year ended December 31, 2011.
d) Statement of Cash Flows for the year ended
December 31, 2011.
e) Notes 1 through 15 and Exhibits A, C, D, E, G
and H to the financial statements as of December
31, 2011.
f) Supplementary information consisting of the
consolidated financial statements of the Company
with its subsidiaries, with its Notes 1 through 14
and exhibits E, F and H, for the year ended
December 31, 2011.
g) The Supplementary Financial Information
required by the Comisión Nacional de Valores
(Argentine Securities Commission, or CNV, for its
Spanish Acronym) for the year ended December
31, 2011.
h) Additional information to the notes to the
financial statements as of December 31, 2011
required by Section 68 of the listing regulations of
the Buenos Aires Stock Exchange.
i) The Annual Report and the Inventory for the
year ended December 31, 2011.

The parent company only and consolidated
balance sheets, statements of income, of changes in
shareholders' equity and of cash flows referred to in
paragraphs a), b), c) and d) above and the related
supplementary information referred to in e) and f)
above are presented on a comparative basis with the
information arising from the respective financial
statements and supplementary information as of
December 31, 2010.

II. Scope of the review
Except for point 4 of section III), we conducted
our review in accordance with statutory auditing
standards established by Law No. 19,550 as
amended and, to the extent applicable, by the

provisions of Technical Resolution No. 15 of the
Federación Argentina de Consejos Profesionales de
Ciencias Económicas (Argentine Federation of
Professional Councils of Economic Sciences). Said
standards require that the review of the financial
statements be conducted in accordance with
effective auditing standards, that the reviewed
documents and information be consistent with the
information on corporate decisions stated in
minutes and that such decisions conform to the
law and the by-laws, in all formal and
documentary aspects.

In order to conduct our professional work on the
documents detailed in Section I above, we have
reviewed the work performed by the external
auditors, Price Waterhouse & Co. S.R.L., who
issued their report on March 9, 2012, pursuant to
effective auditing standards. Our review included
the findings of the audit carried out by such
auditors.

An audit requires that the auditors plan and
perform their work for the purposes of obtaining
reasonable assurance about whether the financial
statements are free of material misstatement and
significant errors. An audit comprises examining,
on a test basis, evidence supporting the disclosures
in the financial statements, as well as assessing the
accounting principles used and significant estimates
made by the Company's Management, as well as
evaluating the overall financial statement
presentation. In view of the fact that the
Supervisory Committee is not responsible for
management control, the review did not embrace
the corporate criteria and decisions of the
Company's different areas since these matters are
within the Board of Directors' exclusive
responsibilities.

In connection with the Board of Directors' Annual
Report, the Supplementary Financial Information
required by CNV Regulations and the Additional
information to the notes to the financial statements
required by Section No. 68 of the Regulations
issued by the Buenos Aires Stock Exchange, all for
the year ended December 31, 2011, we have
verified that, respectively, these documents have the
information required by section 66 of the
Argentine Business Associations Law No. 19,550,
point 4 of Exhibit I, Chapter XXIII, of CNV
Regulations and Section No. 68 of the Regulations
issued by the Buenos Aires Stock Exchange. The
representations included in such documents
concerning the economic framework in which the
Company operated, the corporate management
and future events are the Board of Directors'
exclusive responsibility. Furthermore, concerning
the accounting figures disclosed in said documents,

within the field of our competence, we have
verified that said figures are consistent with the
Company's accounting records and other related
documents.

III. Prior comments
1. On October 10, 2009, Audiovisual
Communication Services Law 26,522 (the “Law”)
was enacted which repeals Broadcasting Law
22,285 under which the Company's subsidiaries
provide audiovisual communication services.

As mentioned in Note 15 to the parent company
only financial statements and in Note 11 to the
consolidated financial statements, the Company
and certain subsidiaries are analyzing the possible
consequences that could be derived from the
change in the regulatory framework on their
business, and legal actions are being and will be
brought at each instance to safeguard its rights and
those of its shareholders.

Accordingly, there is uncertainty as to the effect
that this change in the regulatory framework and
the outcome of the legal actions being brought by
the Company could have on the activities of the
economic group and, therefore, on these financial
statements.

2. As mentioned in Notes 8.2.b., 8.2.c., and 8.2.i.
to the consolidated financial statements, since
September 2009 the Federal Broadcasting
Committee, the National Antitrust Commission,
the Secretariat of Domestic Trade (“SCI”, for its
Spanish acronym), the Argentine Secretariat of
Communications and the Ministry of Economy
and Public Finance have issued several resolutions
on matters related to: (i) the acquisition of
Cablevisión S.A., Multicanal S.A. and other
companies, and their subsequent merger, and (ii)
the revocation of the License that had been
originally granted to FIBERTEL S.A. Additionally,
as mentioned in Note 8.2.m. to the consolidated
financial statements, the subsidiary Cablevisión
S.A. was served with a preliminary injunction
granted to a third party ordering the separation of
the assets, liabilities and businesses that used to
belong to Multicanal S.A. and that were
subsequently merged into Cablevisión S.A. and the
appointment of a court-appointed supervisor
(interventor) and co-administrator. As mentioned
in the above-mentioned notes, Cablevisión S.A. has
brought legal actions as it considered appropriate.

Accordingly, there is uncertainty as to the effect
that the final outcome of these situations could
have on the activities of the subsidiary Cablevisión
S.A. and, therefore, on these financial statements.

3. As mentioned in Note 8.2.g. to the consolidated
financial statements, on March 3, 2010 the
Secretariat of Domestic Trade (“SCI”) issued
Resolution 50/10 establishing a formula for the
calculation of the monthly subscription price to be
paid by the users of pay-television services. On
March 10, 2011 SCI Resolution No. 36/11 was
published in the Official Gazette establishing the
parameters to be applied to the services rendered by
Cablevisión. On May 2, June 30, August 31,
October 31 and December 29, 2011, the SCI
extended the term of Resolution No. 36/11 until
March 2012. As indicated in that note, Cablevisión
S.A. has filed the corresponding administrative
claims and will bring the necessary legal actions
requesting the suspension of the effects and the
eventual annulment of those resolutions.

Accordingly, there is uncertainty as to the effect
that the outcome of the situation could have on
the subsidiary Cablevisión S.A. and its subsidiaries'
business and, therefore, on the recoverability of its
assets and these financial statements.

4. As mentioned in Note 1 to the consolidated
financial statements, the Company does not have
Papel Prensa S.A.I.C.F. y M.'s financial statements
as of December 31, 2011 to support its equity
interest in such company. Therefore, in preparing
the Company's financial statements mentioned in
section I., the Company has relied on Papel
Prensa's financial statements as of September 30,
2011 approved by that company's Board of
Directors, which were subject to a limited review
by its auditors, and on an estimate made by the
Company of the October-December 2011 results.
This situation is not in accordance with the
professional accounting standards in force, which
require the use of financial statements that have an
audit report issued by an independent certified
public accountant. Additionally, in view of the
above-mentioned situation, we have been unable to
perform the audit procedures on such investment
in that company, which amounts to Ps.
194,029,432, as disclosed under Investment in
unconsolidated affiliates in the financial statements
as of December 31, 2011.

5. As indicated in Note 1.2 to the consolidated
financial statements and in Note 2.5 to the parent
company only financial statements, the items and
figures contained in the reconciliations included in
those notes may be subject to changes and may
only be deemed final once the Company has
prepared the annual financial statements for the
year in which the International Financial Reporting
Standards are applied for the first time. These
reconciliations may also be affected by the situation
described in point 4 of this section.

158 159

IV. Supervisory Committee’s opinion
1. In our opinion, except for the effect on the
financial statements of eventual adjustments, if any,
that might result from not having had the scope
limitation in our work and the deviation from
professional accounting standards as indicated in
point 4 of section III and subject to the effect on
these financial statements of potential adjustments
and/or reclassifications, if any, that may be required
as a result of the resolution of the uncertainties
described in points 1 through 3 of section III:

a) The financial statements detailed in items a)
through e) of Section I above present fairly, in all
material respects, the financial position of Grupo
Clarín S.A. as of December 31, 2011, and the
results of its operations, the changes in its
Shareholders' Equity and its cash flows for the year
then ended in conformity with effective
professional accounting standards.

b) In our opinion, the consolidated financial
statements as of December 31, 2011 set out in
point f) of Section I above have been prepared in
accordance with the basis for the preparation and
presentation of consolidated financial statements
detailed in Note 1 to such consolidated statements,
which are in line with the guidelines of Technical
Resolution No. 21 of the Argentine Federation of
Professional Councils in Economic Sciences.

2. The Board of Directors' Annual Report, the
Supplementary Financial Information required by
CNV Regulations and the Additional information
to the notes to the financial statements required by
Section No. 68 of the Regulations issued by the
Buenos Aires Stock Exchange, all for the year
ended December 31, 2011, contain, respectively,
the information required by section 66 of the
Argentine Business Associations Law No. 19,550,
point 4 of Exhibit I, Chapter XXIII, of CNV
Regulations and Section No. 68 of the Regulations
issued by the Buenos Aires Stock Exchange. The
representations included in such documents
concerning the economic framework in which the
Company operated, the corporate management
and future events are the Board of Directors'
exclusive responsibility. Concerning the accounting
figures disclosed in said documents, within the
scope of our competence, we have verified that said
figures are consistent with the Company's
accounting records and other related documents.
We do not have any observations on those figures
other than those indicated in points 1. through 4.
of section III.

3. The figures disclosed in the Financial Statements
mentioned in items a) through e) of Section I

above and the corresponding Inventory arise from
the Company's accounting records kept, in all
formal aspects, in accordance with effective
legislation that provides for the assurance and
completeness based on which they were authorized
by the CNV. Such financial statements, as well as
the consolidated financial statements mentioned in
point f) of section I, have been recorded in the
“Inventory and Balance Sheet” legal book.

V. Additional Information required by the
Regulations of the Argentine Securities
Commission
Pursuant to the Regulations issued by the
Argentine Securities Commission, we hereby report
that:

a) The accounting policies applied in the
preparation of the financial statements mentioned
in items a) through e) of Section I above are in
accordance with professional accounting standards.
In particular, we refer to point 4. of section III in
Prior comments;

b) Furthermore, we report that in exercise of the
legality control within our competence, during the
year ended December 31, 2011, we have applied
the procedures set forth in Section 294 of Law No.
19.550, as deemed necessary pursuant to the
circumstances and we have no observations to
make in that regard; and

c) The external auditors have conducted their audit
in accordance with effective auditing standards set
forth by the Argentine Federation of Professional
Councils in Economic Sciences. Such standards
require the external auditors' independence and
unbiased opinion for conducting the audit of the
financial statements.

VI. Information required by the rules of the
financial reporting unit
We have applied the asset laundering and terrorist
financing crimes prevention procedures provided
under Resolution No. 77/2011 issued by the Board
of the Consejo Profesional de Ciencias Económicas
de la Ciudad Autónoma de Buenos Aires
(Professional Council in Economic Sciences of the
City of Buenos Aires).

City of Buenos Aires,
March 9, 2012

Carlos Alberto Pedro Di Candia
Chairman

Grupo Clarín S.A.
Piedras 1743
C1140ABK Ciudad de Buenos Aires
Argentina
www.grupoclarin.com

Investor Relations

Grupo Clarín
Alfredo Marín / Agustín Medina Manson
+ 54 11 4309 7215
investors@grupoclarin.com
www.grupoclarin.com/ir