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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) September 9, 1999
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CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
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(Exact Name of Registrant as Specified in Charter)
Bermuda 0-24796 Not Applicable
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
Clarendon House, Church Street, Hamilton HM CX Bermuda
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (441) 296-1431
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Not Applicable
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(Former Name or Former Address, if Changed Since Last Report
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Item 5. Other Events.
Attached is a Press Release issued by Registrant on September 9, 1999 (the
"Press Release").
2
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Exhibits
99.1 Press Release of Central European Media Enterprises Ltd.,
dated September 9, 1999.
3
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Central European Media Enterprises Ltd.
(Registrant)
Dated: September 9, 1999 By: /s/ Fred T. Klinkhammer
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Fred T. Klinkhammer
Title: President and Chief Executive Officer
(Duly Authorized Officer)
4
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CENTRAL EUROPEAN MEDIA ENTERPRISES' CZECH SUBSIDIARY CNTS SUSPENDS TECHNICAL
AND PRODUCTION OPERATIONS
Czech Republic, September 9, 1999 - Central European Media Enterprises Ltd.
("CME" or the "Company") (Nasdaq: CETV) announced today that its 99%-owned Czech
subsidiary, Ceska nezavisla televizni spolecnost, spol. sr.o. ("CNTS") has
suspended technical and production operations in Prague until such time as it is
again able to operate a national television service. As a result, CNTS today
dismissed over 215 employees.
The action is taken as a result of the pre-emption of CNTS's transmissions of
Nova TV by CET 21, spol. sr.o. ("CET 21"), which began on August 5, 1999 to
broadcast a substitute signal for Nova TV from a site other than the CNTS
studios. The pre-emption continues to date. While CNTS and CME have repeatedly
requested the Czech Media Council to intervene as a result of breaches of the
Czech laws, CET 21's legal obligations and the destabilization of the Czech
media market caused by CET 21's actions, the Media Council has thus far failed
to act.
Fred Klinkhammer, President and Chief Executive Officer of CME, said "We believe
that there are many people in the Czech Republic who, if I may quote the
President of the Czech Republic, 'want to hear that decency and courage make
sense, that something must be risked in the struggle against dirty tricks.'
While we fully expect that the international arbitration proceedings and Czech
courts will ultimately uphold the legitimate damage claims of CNTS, CME and
Ronald Lauder, only the Media Council has the power to timely restore the
operating business of CNTS and the jobs of these people who trusted in the
fairness and the rule of law. They are not alone, forgotten or written off. We
will recall them if and when conditions permit."
The failure to recommence CNTS's operations will have a material adverse effect
on the Company's results of operations and its financial position. CNTS's net
revenues were $48,496,000 for the six months ended June 30, 1999 and
$108,826,000 for 1998, comprising 57% of the Company's consolidated net revenues
for the six months ended June 30, 1999 and 60% of the Company's consolidated net
revenues for 1998. Nova TV's EBITDA was $18,654,000 for the six months ended
June 30, 1999 and $54,887,000 for 1998, while the Company's overall consolidated
EBITDA was $13,142,000 for the six months ended June 30, 1999 and $44,796,000
for 1998.
If CNTS does not recommence broadcasting operations, the Company will likely be
forced to write-down all or a portion of the $42,439,000 carrying value of
goodwill associated with the CNTS operations as of June 30, 1999 and programming
rights in the amount of $15,892,000 at June 30, 1999.
Dividends totaling $19,505,000 in 1998 and $7,972,000 in 1997 were paid by CNTS
to the Company, comprising all dividends paid to the Company from its television
operations during these periods. A material reduction or elimination of CNTS's
dividend payments to the Company in 1999 and future years could, absent other
sources of cash, result in the Company having inadequate cash resources to meet
its operating, capital and debt service requirements by no later than June 30,
2000.
Forward-looking Statements
Statements made above regarding disruptions of operations and effects on CNTS's
and CME's operating results and financial condition are forward-looking
statements. Forward-looking statements are inherently subject to risks and
uncertainties, many of which cannot be predicted with accuracy and some of which
might not even be anticipated. Future events and actual results, financial and
otherwise, could differ materially from those described in or contemplated by
the forward-looking statements.
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CME broadcasts in Central and Eastern Europe, and operates eight television
stations in six countries, reaching an audience of 84 million people, and is
traded on the Nasdaq National Market in the U.S. under the symbol "CETV".
# # #
For further information, contact:
Chris Plunkett or Michael Smargiassi
Brainerd Communicators, Inc.
Tel: 212 986-6667
