1. SONY PICTURES ENTERTAINMENT
Information Technology
Fiscal Year 2015 Q2 Forecast
and
2014 Mid Range Plan
August 19, 2014

2. Executive Summary Budget to Q2 Variance: Prior Year MRP - FY16 ($10+m)
IT is expected to be $2.8m unfavorable to budget due primarily to:
Accounting for SPIRIT World & C2 Sales net ($1.2m)
Discontinued Brazil JV allocation to Fox ($0.7m)
Unbudgeted / transferred headcount ($0.5m); AMMO ($0.4m) & ADM 1 HC
Non cap associated with additional cap spending ($0.5m)
Prior Year MRP - FY16 ($10+m)
Incremental growth in Outside Services ($2.5m), Ad Sales, TV Networks, B2B, RPM and Archer
Non cap & depr. on incremental FY15 projects ($3.7m)
Groups transferred in FY15, net of allocation DMG ($1.4m), AMMO ($0.4m)
TV Networks growth in UK – CSC ($1.2m) and SaaS ($0.2m)
Telecom - Level 3 reduction, closed and consolidated lines of $3.0m

3. 2013 MRP Prior Year to FY15 Budget & Q2 Forecast
Budget was kept to 2013 MRP by adding Telecom $2.7m savings , offset by transfers and additional challenge of $600k

4. Overview
CY Budgeted headcount higher than PY MRP by 19, offset by telecom cost & overhead allocation to projects
Additional headcount in Q2 for Interactive (4) and AMMO (2)
Incremental FY16 Costs:
Six (6) incremental heads; (3) for UK TV growth, (2) for PARIS support and (1) Media Center support
Elimination of DMG legacy salary allocation ($400k)
SaaS for CSC ($500k), TCS – EIS ($275k) and Trintech ($200k)
Telecommunications cost ($350k) due to one time AT&T refund
Year over year gross overhead growth between 3% and 4%
Outer year depreciation & non-cap spending based on 2013 MRP + incremental on active projects
Assumes no changes to allocation methods to LOBs, 3rd parties, and projects (currently under review)

5. Year over Year FYE15 – FYE18

6. 2013 Prior Year MRP vs. 2014 Current MRP (FYE16)

7. 2013 Prior Year MRP vs. 2014 Current MRP (FYE17)

8. Projects & Non Cap Spending
Project Spending
Non cap Proj. Exp.
Original budget of $62.5m capital spending was increased to $69.5m in Q1
Approximate non-cap impact of this increase is $500k
FY16-FY18 assumed to be PY MRP + current year incremental

9. DMG ($3m) not in PY MRP + Incremental FY15 spending
Depreciation Expense
DMG ($3m) not in PY MRP + Incremental FY15 spending