Letter from the Chairman
of the Board of Directors
to the General Ordinary Stockholders Meeting of Megacable Holdings S.A.B. de C. V.

Esteemed shareholders,

2017 got off to a complicated and challenging start: increased prices of a range of goods and services led to a decrease in the purchasing power of our main market, not to mention the effect that programming changes made in 2016 and the transition period for the analog switch-off had on the number of subscribers at the beginning of the year. These challenges tested our strategy and our ability to drive innovation and continue offering competitive and quality solutions, in addition to maintaining profitable growth.

During the second quarter of 2017, we got back on track, driving growth and launching new, innovative and highly attractive products, helping us to remain at the cutting edge of the industry and offering new ways to access content. We also further consolidated our position in the services we already offered. Today, Megacable is a company that has expanded its horizons and strengthened its position.

We have consolidated our value proposition, offering the best products at accessible prices, becoming the most competitive option available on the market, operating more efficiently and exceeding customer service levels.

As a result, our growth rate is above the industry average in a very competitive market, and we have achieved two decades of growth and excellent levels of profitability.

Some of our most relevant achievements include the launch of Xview, an innovative entertainment system that combines online content and libraries on a single platform, allowing users to decide what, when and where they want to watch their favorite programs. This new product is revolutionizing the market in Mexico and is growing quickly.

Our products and services aimed towards the enterprise and corporate segments also experienced significant growth as a result of our flexible and efficient solutions, mainly due to our modern network, and cutting-edge technology, all of which have driven the integration of multiple additional services at very competitive prices.

In 2017, we increased our penetration in the corporate telecommunications market, where we are targeting the SME market, a segment that, given its characteristics, represents a major area of growth.

We have deployed network infrastructure to cater to this market in cities like Cancun, Mexico City, Ciudad Juarez, Monterrey and Tijuana, where the Company has no residential network infrastructure.

To fulfill our commitment to social responsibility, we have implemented measures to help decrease energy consumption, increase the use of renewable energy sources, and optimize our use of resources in general.

To be consistent with our activities, in the 30 news programs that we broadcast in the same number of geographical regions, we provide coverage of local and regional news, helping create better and more informed citizens while engaging with society to help find best practices to achieve a positive evolution in the communities in which we operate.

We employ more than 18,500 people at Megacable, who, through on-going training opportunities and the constant growth within the Company, have access to integral development opportunities, helping them develop in both their professional and personal lives.

In 2017, Megacable consolidated its investment capacity through successful cash generation strategies, achieving a healthy balance sheet that has helped us to continue growing organically while monitoring inorganic growth opportunities. Our wide-ranging experience, quick decision-making process and consolidated business model will continue to be the guiding force behind our investment process.

Our vision for the future is to become the best telecommunications Company by offering the best products at the best prices.

This is our commitment, and, through the professionalism and dedication of our employees, the experience, knowledge and vision of our Board Members and Management Team, and the trust our customers and shareholders place in us, we are certain that we will continue achieving our growth and profitability goals. I would like to thank each and every one of them.

Sincerely,