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2015-04-23

TECHNICOLOR : Q1 2015 Revenues

Technicolor: Q1 2015 Revenue Performance

* Q1 2015 revenues up 8.3% at current currency, down 3.2% at constant
currency
* Full year 2015 objectives confirmed
* Strong start on Drive 2020 initiatives

Paris (France), 23
April
2015
-
Technicolor(Euronext Paris: TCH; OTCQX: TCLRY) announces today its revenues
for the first quarter of 2015.

Frederic Rose, Chief Executive Officer of Technicolor, stated:

"Our strong first-quarter performance means we are well on our way to deliver
on our 2015 objectives of EBITDA and FCF. With the launch of the UHD Alliance
and our broad program of initiatives in High Dynamic Range technologies and
services, the HEVC Advance patent pool and the announced acquisitions of
OuiDo Productions and Mikros Image, Technicolor's implementation of its Drive
2020 strategic plan is on track and we are laying foundation for success in
our key areas of profitable growth. Even at this early stage, 2015 is shaping
up to be a very good year for Technicolor."

Key points

* Technology revenues above €120 million, significant business development in
Technology Licensing and establishment of HEVC Advance patent pool;
* Acquisition of OuiDo Productions and Mikros Image, joint-venture in Digital
Cinema and exit from poorly performing Digital Distribution activities;
* DVD volumes down, partially due to an unfavourable comparison base;
* Connected Home on track for full year growth and continued margin
improvement;
* Improved credit profile with Moody's rating upgraded to B1 (vs. B2), driven
by strong financial performance.

2015 objectives confirmed

* Adjusted EBITDA between €560 million and €590 million;
* Free Cash Flow of at least €230 million;
* Leverage ratio (Net Debt/Adj. EBITDA) of around 0.75x at end December 2015

Segment review - Q1 2015 revenue highlights

Group revenues by segment

-------------------------------------------------------------------------------------------------
| First Quarter Change YoY |
| In € million 2014 2015 Reported At constant rate |
| Technology 113 123 +9.0% (2.2)% |
| Entertainment Services 328 358 +9.2% (4.1)% |
| Connected Home 291 317 +8.9% (0.8)% |
| Group revenues (excl. legacy activities and Other) 732 798 +9.1% (2.5)% |
| Legacy activities 5 1 (87.8)% (89.9)% |
| Other 7 7 (0.4)% (19.0)% |
| Group revenues 744 805 +8.3% (3.2)% |
-------------------------------------------------------------------------------------------------

Technology
revenues amounted to €123 million in the first quarter of 2015, up 9% at
current currency compared to the first quarter of 2014. Licensing revenues
totaled €118 million in the period, increasing by 7% year-over-year. Revenues
generated by the MPEG LA pool were significantly higher, due to favorable
€/US$ exchange rate movements that fully offset continued softness in the
global PC industry. Revenues from direct licensing programs remained solid
but were lower compared to the first quarter of 2014, which benefited in
particular from the LG smartphone licensing agreement signed in February 2014
(including a lump sum payment for the past).

In the first quarter, Technicolor joined GE, Dolby, Philips and Mitsubishi
Electric as initial licensors of the HEVC Advance patent pool. The pool is
expected to launch in the third quarter of 2015, with at least 500 essential
HEVC patents, which should grow rapidly and already provide broad and
high-quality intellectual property coverage.

Technicolor made progress in Technology Licensing business, with the
announcement of the Group's first technology licensing deal in the mobile
industry, partnering with Chinese mobile device manufacturer TCL on the
launch of its latest premium smartphone, IDOL 3, which embeds Technicolor's
Color Enhance technology. The Group also continued to make significant
progress around its HDR offering and has now initiated discussion with
leading SoC makers, encoding partners and postproduction tool companies to
implement its core solution.

Technicolor's service platform, M-GO, continued to increase its market and
audience reach in the first quarter of 2015 benefitting from a strong release
slate.
Entertainment Services
revenues amounted to €358 million in the first quarter of 2015, up 9.2% at
current currency compared to the first quarter of 2014. This performance was
driven by a positive forex impact and the strong growth of Production
Services revenues that partly offset lower DVD volumes.

* Production Services revenues rose significantly in the first quarter of
2015, supported by double-digit year-on-year growth across Visual Effects
("VFX") and Animation activities and a strong performance in Postproduction
Services in Canada. Postproduction activities in the US were slightly down
as the good performance of TV series did not fully offset lower Theatrical
revenues, resulting from the delay to the end of the quarter of several
titles from a key studio customer.

Technicolor continued to grow at record level in VFX for feature films
and commercials, driven by strong organic growth and incremental revenues
associated with the acquisition of Mr. X in July 2014. The Mr. X acquisition
integrated well with Postproduction activities in Canada, which increased at
a solid rate in the quarter. VFX for commercials grew across facilities and
benefited from the opening in the fourth quarter of 2014 of two new VFX
studios in Shanghai (China) and Paris (France) that gained traction rapidly.

Technicolor continued during the quarter to develop its offering of
creative services and tools for the premium content industry and to grow in
the Animation market, with the acquisition in February 2015 of OuiDo
Productions, a French-based production house specialized in animated TV
series. The OuiDo acquisition expanded Technicolor's global offering and
bolstered contribution of Animation revenues. The Group also pursued its
focus on growing its position in the Animation and Advertising markets, with
the acquisition of Mikros Image announced in early April 2015, which would
strengthen its position and offering in the Animation market and drive the
Group to lead France's Advertising market.

During the first quarter of 2015, VFX teams completed work onFast and
Furious 7
(Universal), while pursuing work on Theatrical projects such asJungle Book
(Disney),Monster Trucks
(Paramount),The Fantastic Four
(Fox),Goosebumps
(Sony),Pan
(Warner),Terminator Genisys
(Paramount), as well asFrankenstein
(Fox). Postproduction teams also recorded a sustained level of activity during
the period, completing work on Theatrical projects such asAvengers: Age of
Ultron
(Marvel/Disney) andInsurgent
(Lionsgate). Technicolor continued to lead the premium TV series market, with
Postproduction teams completing work on successful TV franchises
includingBanshee
(HBO),The Originals Season 2
andThe Vampire Diaries Season 6
(Warner), while they also confirmed their leading market position with
Over-the-Top ("OTT") service platforms, completing work on original content
for Amazon (Bosch
) and Netflix (Daredevil
,Narcos
,Sense 8
,Grace&Frankie
).

In accordance with its Drive 2020 strategic plan, Technicolor implemented
in the first quarter of 2015 some structural enhancements, specifically in
Digital Distribution and Digital Cinema activities. In Digital Distribution,
the Group decided to focus solely on its digital servicing platform and to
phase out immediately all non-platform services. In Digital Cinema,
Technicolor and Deluxe announced a binding agreement to establish a worldwide
joint-venture combining both companies' businesses, which is expected to
close in the second quarter of 2015. Financial implications of the above will
be provided with Technicolor's first half 2015 results.
* DVD Services revenues decreased in the first quarter of 2015, reflecting an
11% decline in combined Standard Definition DVD and Blu-rayTMdisc volumes
compared to a very strong first quarter of 2014, which benefited from the
significant success of Disney'sFrozen . This decline in volumes also
resulted from continued weakness in the fourth quarter of 2014 of major new
releases across Technicolor's key studio customers (which reported a 13%
year-on-year decrease in their Q4 2014 box office revenues). Volume trends
were generally better in Europe than in North America in the period.

During the first quarter of 2015, Standard Definition DVD volumes
decreased at a lower rate of decline compared to the second half of 2014,
driven by growth in independent (non-studio) customers, as well as
significant growth from one key studio customer across both new releases and
catalog. Blu-ray(TM) disc volumes declined in the first quarter of 2015
compared to a very strong first quarter of 2014 as it was also impacted
byFrozen
and the introduction of the Xbox One platform that occurred in late 2013. Xbox
One volume was stable during the period, due to the seasonal second half
timing of key new releases, while demand for the prior generation Xbox
platform continued to decline as expected.

The first calendar quarter is typically a seasonally slow period for
major Games releases, and specific to the first quarter of 2015, the overall
release slate for the Group's major studio customers was not particularly
strong. The improvement in 2015 box office performance to date and a high
quality upcoming release slate for both Theatrical and Games titles are
expected to help support improved year-on-year comparative volume trends in
the second half of 2015.

Major titles produced in the first quarter of 2015 includedBig Hero 6
(Disney),The Hobbit: The Battle of the Five Armies
(Warner),Unbroken
(Universal) andInterstellar
(Paramount/Warner).

Volume Data for DVD Services

--------------------------------------------------------------
| First Quarter |
| In million units 2014 2015 Change |
| Total Combined Volumes 304.4 269.6 (11.4)% |
| By Format Standard Definition DVD 239.2 211.0 (11.8)% |
| Blu-ray(TM) 65.2 58.6 (10.1)% |
| By Segment Studio / Video 280.5 252.5 (10.0)% |
| Games 12.3 9.6 (22.3)% |
| ...

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