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Page 1: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

1

ISR

PRESENTATION

2019

Page 2: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

STRATEGY

Page 3: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FNAC DARTY OMNICHANNEL LEADER IN EUROPE

€7.5bn revenue – 25,000 employees

Top 3 European Omnichannel Retailer

780+ multiformat stores in 12 countries

2nd largest e-commerce retailer in France(1)

19% of Group sales

81 million transactions

No. 1 after-sales service in France(2)

8 million loyalty program members

49% of online sales are omnichannel

3

France &

Switzerland 78%

Iberian

Peninsula 9%

Benelux 13%

2018 Turnover €7.5bn

Technical products

51%

Editorial products

17%

White goods

22%

Other products and

services (3)

10%

2018 Turnover €7.5bn

0%

1%

3%

5%

6%

7%

9%

11%

15%

19%

22%

28%

32%34%

51%

0% 10% 20% 30% 40% 50% 60%

What brand do you think best embodies the success of the omnichannel transition?4th barometer Oliver Wyman – October 2017

1 Source: FEVAD, 20182 Internal customer studies3 Include: Ticketing, B2B, after sales service, membership fees, franchise fees, insurance, consumer credit

Page 4: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

Strict rules and audit procedures with our suppliers:

Distribution of the "Supplier CSR Charter" to our third-party suppliers

Integration of CSR dimension in processes and documents framing the supplier relationship and execution of audits on manufacturing facilities of our own-brand product suppliers

2921

31

26

44

28 2726

27

1921

16 16 18

TOTAL CE IT Telecom SDA MDA Book Audio/video/gaming

Fnac Darty market share in Premium segments: 3rd and 4th quartile1

Fnac Darty market share (total market)1

LEADING POSITIONS IMPLYING RESPONSABILITY…

4

1 Source: GFK - 2018 FY data – France

#1 in all our markets, specifically on high-end products

43.5%

25%

41%

28%

19%

Supplier #1 Supplier #2 Supplier #3 Supplier #4 Supplier #5

client for key suppliers, in share of wallet

Source: GFK YTD Sept. 2017 - Fnac Darty - France

audited plants

CSR check points

unsatisfactory CSR audit

Audits carried out in 2018 on manufacturing facilities of our own-brand product suppliers

27

99

18

#1

Page 5: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CONFIANCE +: FNAC DARTY STRATEGIC PLAN

5

Customers are agnostic

OMNI-CHANNEL

Growth driver Targeting new markets to find new opportunities

DIVERSIFICATION

Differentiating asset

LOYALTY

Further gains in market share

BELIEFS Ecosystem cornerstone

SERVICESFRANCHISE

200+ openings Kitchen plan:

100+ new stores

Shop-in-Shops

rollout

Launch of

Smart Home

Subscription programsMarketplace x3

Logistics open to third parties

UX Program

Self-checkout

Operating margin mid-term objective: 4.5-5%

Page 6: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CONFIANCE + ROLL-OUT BASED ON TWO ICONIC BRANDS

6

Give access to culture

Independent vendors to give best advice for an educated purchase

INDEPENDENT EXPERTISE

AND CUSTOMERS’ ADVICE

RESPONSIBLE PRODUCTS

AND SERVICES

Strong services offer for repair, reuse and product recycling

#1 after-sales service

launch of Fnac Labo launch of Darty

« contrat de confiance »1972 1973

Page 7: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CONFIANCE + ROLL-OUT BASED ON OUR HUMAN CAPITAL25,000 EMPLOYEES: A KEY DIFFERENTIATING ASSET

7

Figures as at 31/12/2018

Turnover

Absenteeismsickness

SeniorityFrequency rate

Accidents at work

Women

Senior

38.6%

19.7%Average age

40.4YEARS OLD

38.5

35

37

28

Retail: 10-15%

12.6%

4.6%

25.4

12.7YEARS

National: 4.9 %*

National: 33.8**

50+

4.3%Disability

France -Switzerland;

71%

Iberica16%

Benelux13%

Salesforce by geographic region

Page 8: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FNAC DARTY: A RECOGNIZED RESPONSIBLE COMPANY

8

FNAC and DARTY are identified by customers as more responsible brands than AMAZONResults of the customers survey conducted in December 2017

“Could you please rate from 1 to 10 the social commitment of the following brands?”

Page 9: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FNAC DARTY: A RESPONSIBLE RETAILER RECOGNIZED BY ESG RATING AGENCIES

9

Information rate: 72%

Sector average: 53%

Rank in Sector: 16/71

Rank in Region: 698/1349

Rank in Universe: 1310/4660

Overall ESG scrore Relative position

6138out of

136

Page 10: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

A 6-PILLAR CSR POLICY TO MEET EXEMPLARY OBJECTIVES AND BUSINESS OPPORTUNITIES

10

Page 11: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CSR LEVERAGES EXEMPLARY OBJECTIVES

11

As a leader, Fnac Darty must be best in class

Transforming

Fnac Darty

while developing

employer’s

responsibility

Being

flawless

to limit risks

Limiting the

environmental

impacts of our

activities

to reduce risks

and costs

Page 12: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

SOCIAL RESPONSIBILITY HUMAN CAPITAL OUR KEY ASSET

12

TARGETS

ACTIONS

Build 1 Group with 2 brands

Promote a common culture

Voluntary Redundancy Scheme

Centralisation of headquarters

Harmonisation of the statutes

FNAC DARTY INTEGRATION

Page 13: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

SOCIAL RESPONSIBILITY HUMAN CAPITAL OUR KEY ASSET

13

A GLOBAL BUSINESS UNIT DEDICATED TO PEOPLE DEVELOPMENT

2017 – 2018 PROJECT MANAGER 2020

Implementation of a 24-month diploma training programme for Operating Managers

Develop the “Manager Coach” approach

Nearly 600 managers trained from several business lines

Significant participation rate (94% attendance at face-to-face sessions)

2018 – 2019 PROJECT CLIENT EXCELLENCE

Implementation of a "CUSTOMER EXCELLENCE" training programme, for a period of 12 to 18 months

Anticipate the evolution of business lines, facilitate mobility and develop the employees’ employability in stores

Develop customers’ relations and sales skills in all business lines

Vendors

56%

Services, Cash

registers and Logistics

42%

Deliverers

1%

Call Center

Consultants

1%

DEVELOPPING PEOPLE

STRATEGIC PROGRAMS

« FNAC DARTY ACADEMY »

1

2

Client excellence: trained employees breakdown

Page 14: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

SOCIAL RESPONSIBILITY HUMAN CAPITAL OUR KEY ASSET

14

Digital, short and monthly survey to c.15,000 employees with results immediately available to managers

Instill a culture based on listening & proximity, agility & innovation

Manage employees’ engagement

Implemented in France and abroad with matching contributions up to 700€ and a 20% discount on the subscription price

Strengthen the sense of belonging to Fnac Darty through value-sharing schemes

An overall subscription rate of 18.13%

4,500 subscriptions and an average subscription amount of 1,500€

Capital increase on 90,558 shares at a price of €73.72

COMMITTING PEOPLE

FNAC-DARTY EMPLOYEE STOCK PURCHASE PLAN

Page 15: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FNAC DARTY FACESETHICAL REQUIREMENTS

15

New 2017-2018 laws

Themes

Governance

Actions carried

out in 2018

Respect for human rights,

environmental, labour and

fundamental freedoms

Privacy by design, profiling,

right to erase and portability,

notification of data leaks

Prevention, settlement

agreements, repressive and

preventive aspects

Data Privacy OfficerGroup CSR Manager Internal Audit Director

ETHICAL COMMITTEE

Duty of care RGPDSapin II

Risk mapping

Due diligence subcontractors, suppliers, subsidiaries, stakeholders

Alert and reporting systems

System for monitoring and evaluating

the measures implemented

Communication and integration of

customers policies into contracts

Training and employee awareness

Page 16: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FNAC DARTY RAISES AWARENESS TO REDUCE CONSUMPTION AND LIMIT ENVIRONMENTAL IMPACTS

16

Ecoguide implemented

in Fnac Darty stores in France

First Fnac Darty Carbon audit conducted in 2017

Action to be strengthened: click & collect

This carbon footprint concerns scopes 1 and 2 (direct emissions). The emissions caused

by the life of the products are 9 times larger. Our leverage to reduce this impact is to

extend the life of these products, as described in the circular economy pillar.

Page 17: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CSR LEVERAGES BUSINESS OPPORTUNITIES

17

Expertise and customers’ information

Economic, social and cultural

actor

Page 18: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CSR LEVERAGES BUSINESS CHALLENGES & OPPORTUNITIES

18

CONSUMERS’ EXPECTATIONS

AGILITY / PROXIMITY

EDUCATED CHOICE

EXPERIENCE OVER GOODS

FNAC DARTY STRATEGY

BEST IN CLASS OMNICHANNEL EXPERIENCE

A UNIQUE SERVICES PROPOSAL

UNIQUE AFTER-SALES BEST IN CLASS PRODUCTS

OFFER AND LINEUP

CSR COMMITMENTS

BEST ADVICE THROUGH FNAC LABO ENVIRONMENTAL IMPACT NOTE ON TECHNICAL PRODUCTSFNAC DARTY BAROMETER FOR PRODUCTS REPAIR

CONTRIBUTION TO THE LOCAL ECONOMY, CULTURAL AND SOCIAL LIFE THROUGH FNAC DARTY OMNICHANNEL PLATEFORM

CIRCULAR ECONOMY

Ecodesign and customers’ information

Re-use

Repair

Recycling Waste collector in France

After sales service in France

# 1

Page 19: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FNAC DARTY: AN ECONOMIC, SOCIAL AND CULTURAL ACTOR

19

A SIGNIFICANT STORES NETWORK TO

CONTRIBUTE TO THE LOCAL ECONOMY

780 stores worldwide in 2018, of which:

WIDEN ACCESS TO CULTURE

34 Fnac in Spain

28 Fnac in Portugal

8 Fnac in Switzerland

147 stores in Benelux

(11 Fnac and 72 Darty

in Belgium;

64 Darty in the

Netherlands)

382 Darty

(220 integreted-stores

and 162 franchisees)

180 Fnac

(88 integreted-stores

and 92 franchisees)

1 Fnac in Tunisia

3 Fnac in Morocco

2 Fnac in Qatar

2 Fnac in Ivory Coast

1 Fnac in Congo

1 Fnac in Cameroon

Objective of

+60 new stores

openings

in 2019

# 1Record shop owner in France

Bookstore in France

Ticket vendor in France

1,650 free cultural events in Fnac stores in France

90,000 people participated to the Fnac LIVE festival: 30 free concerts over 3 days

10,000 people participated to the Forum Fnac Livres

3Key literary award

217 international stores

563 stores in France

Page 20: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

SOCIAL RESPONSIBILITY HUMAN CAPITAL OUR KEY ASSET

20

Since 2012Since 1972

compares the

characteristics and

performance of

technical products

1 038 tests on 492

products in 2018

ENVIRONMENTAL NOTE

indicates the

environmental impact of

TVs, Tablets, PCs and

smartphones.

2018

LAUNCH OF A

PRODUCT

REPARABILITY NOTE

PUBLICATION OF THE 1ST

AFTER-SALES BAROMETER

BY BRAND

LAUNCH OF

COMMUNAUTE.DARTY.COM,

the 1ST support community

platform for Darty users

INNOVATIVE ACTIONS THAT ONLY EXIST AT FNAC DARTY

69%of our products

in 2018

Page 21: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

EXTENDING PRODUCTS’ LIFE SPAN IS A KEY ENGAGEMENT TO OUR CUSTOMERS…

21

CIRCULAR

ECONOMY

Build robust and easy to repair products

Inform and advise customers on the proper use

of products

Fnac Darty Occasion

90 products given each day to ‘ENVIE’ for a

second life

Launch of the Smartphone roadworthiness test

2 500 000 operations processed in 2018

Launch of Darty+ in 2017

Launch of Fnac Darty barometer in 2018

Launch of the reparability indice in 2018

Wefix acquisition in 2018

+45,000t of WASTE collected and recycled in 2018

Launch of "2 for1" collecting systems in 2011: « 2 for 1 » and « 1 for 0 »

FNAC DARTY 1st REPAIRER IN FRANCE

FNAC DARTY 1st COLLECTORIN FRANCE

Re-use

Repair

Recycling

Eco

conception

Page 22: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

… WHICH IS STRENGTHENING IN 2018 WITH 6 NEW INNOVATIONS

22

Ma

turité

EC

B2C SERVICES: HISTORICAL ACTIVITIESrepair, collect, reuse and recycle

July: Repairability Index

June: After-Sales Service Barometer

December: Customer Support Platform

1

2

3 November: WeFix

The 6 innovations launched in 2018 enable customers

to be better informed, to better use and repair their

product, and to better sell it back

4

Page 23: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

A REWARDED ENGAGEMENT FNAC DARTY WON THE CIRCULAR ECONOMY AWARD

23

Page 24: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CONFIANCE +: AN OPEN PLATFORM TO OFFER THE BEST IN CLASS OMNICHANNEL RESPONSIBLE EXPERIENCE

24

Stores & Digital

Loyalty Programs

After-sales and delivery

Offer Products and Services

Partnerships

Marketplace

Franchise

Offer and

Product co-construction

FOR PARTNERS FOR CLIENTS

OFFER THE BEST CLIENT EXPERIENCE BEST VALUE

FOR MONEY

ENSURING REACHPROTECTING VALUE

MIDTERM OBJECTIVES:HIGHER GROWTH THAN “MARKETS”

CURRENT OPERATING MARGIN OF 4.5% TO 5%

COMMITTED TO AN EDUCATED CHOICE

Responsible choice

Best value for money

Contribution to the local,

cultural and social life

Repair and recycle

Customers’ information

and advice

Selected responsible

vendors

Ethical business

Contribution to the

local economy

Ecodesign own-brand

products

Page 25: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FINANCE

Page 26: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CONFIANCE+ RAPID PROGRESS IN 2018

26

(1) Excluding the €20m fine from the French Competition Authority

39 store openings in 9M

2018, of which 37

franchises

Close to 70 openings

expected this year

Already 25 shop-in-

shops deployed in

France and 20 Fnac

Home corners opened

in Spain

Close to 130 kitchen

corners now opened as

well as the first kitchen

stand alone store

Acquisition of a majority

stake in WeFix to

position Fnac Darty as a

key provider of

smartphone repair and

related services as well

as to offer customers an

enhanced ecosystem

1 million Fnac+

susbscribers and Darty+

ramp-up

Free premium delivery in

both banners for Fnac+

and Darty+ holders

Weight of online sales

increased to 18%

Marketplace business

volume up sharply: >25%

in Q3 2018

Close to 190 shops

digitalized

Launch of D+1 delivery,

covering 80% of France,

including bulky items

with installation

OMNI-CHANNEL

DIVERSIFICATIONLOYALTY & CONTENT

SERVICESEXPANSION &

FRANCHISE

Page 27: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

STRONG 2018 RESULTS

Topline growth delivered

Strong increase in Current Operating Income at €296m,

up +10% vs. 2017, reflecting good operational

performance and synergies completion

Tight commercial policy

Gross margin at 30.3%, increased by +20bps, excluding the

impact of the franchise (-30bps)

Efficient cost control

Costs reduced to 26.3% of sales from 26.7% in 2017

Net income from continuing operations up +20%

High Operating Free Cash Flow at €173m1

Net cash position only two years after acquiring Darty

27

77

165203

270296

68

2014 2015 2016 2017 2018

EBIT evolution by year in €m

FNAC DARTY

2.7% of sales

3.6% of sales

4.0% of sales

2.3%

of sales

(1) Excluding the €20m fine from the French Competition Authority

Page 28: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

2018: SUCCESSFUL INTEGRATION

A joint organization serving 2 banners

Increased organizational agility

Promote a common culture around shared

and engaging values

Our purpose: promoting “choix éclairé”

Operational agility and peerless execution

Market share gains in France1

Rapid deployment of Confiance+ initiatives

28

(1) source GFK

BUILDING 1 GROUP WITH 2 BANNERS STRONG OPERATIONAL EXECUTION

AT END 2018, €131m OF SYNERGIES DEPLOYED, 1-YEAR AHEAD OF ORIGINAL PLAN

Page 29: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

TOPLINE GROWTH AND GOOD COMMERCIAL EXECUTION

Exceptional items impacting topline growth throughout the year

Q1: weather conditions impact of -0.4pt on sales

Q2: strikes in France impacting store traffic

Q3: high comparison basis related to product launches in 2017 (LFL +5.8% in Q3 17)

Q4: “Yellow Vests” protests impact of approx. €45m of loss in sales

Growth opportunities seized to deliver topline growth for the year

Excellent Black Friday execution in Q4

International operations up +2.4% in 2018

Double-digit growth of services and diversification categories

+20% growth of marketplaces

E-commerce: 19% of Group sales (+2 pts vs 2017)

66 stores opened including 55 franchises

Tight commercial policy: gross margin up +20bp excluding the dilutive effect of franchises

Strong operating model delivering profitability growth in a tough environment

29

0.6%

-1.8% -2.2%

3.4%

0.4%

Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018

Group sales evolution by

quarter(1)

30.4%30.3%

0.3 pt

30.6%

2017 2018 Impact of

franchise

dilution

2018 excl.

franchise

effect

Gross margin evolution

(1) Reported growth

Page 30: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

FRANCE AND SWITZERLAND IN 2018

Stable sales on a LFL basis in a consumption climate

impacted by multiple exceptional effects (weather in Q1,

strikes in Q2 and “Yellow Vests” protests in Q4)

Strong execution in Q4 driven by success of Black Friday

offsetting the impact of Yellow Vest protests

Market share gains

Operational agility, synergies completion and efficient cost

control leading to strong growth in operating margin

Strong increase in current operating income, at +13%,

despite decline in revenue

62 store openings

30

-0.1%

-2.4% -2.9%

2.6%

-0.3%

Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018

2018 sales evolution (2)

(1) Like-for-like: excluding FX, perimeter and expansion effects(2) At comparable scope of consolidation and at constant forex

€m 2017 2018 % Change

Revenues 5,856 5,835 -0.4%

Like-for-like(1) -0.1%

Current operating

income234 265 +13%

Operating margin 4.0% 4.5% +50bp

Page 31: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

IBERIAN PENINSULA IN 2018

Strong sales growth throughout the year

Growth in Spain despite still tense political climate

Continuing strong growth in Portugal

Continuing expansion (3 openings in 2018)

Double-digit growth of web sales and services in both

countries

Expanding network of small domestic appliances corners

(approx.30 at end 2018)

Improving profitability in both countries, driven by gross

margin control despite negative mix effect and opex

increase related to expansion

31

3.4%

6.0%

2.6%

4.5% 4.1%

Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018

2018 sales evolution (2)

(1) Like-for-like: excluding FX, perimeter and expansion effects(2) At comparable scope of consolidation and at constant forex

€m 2017 2018 % Change

Revenues 676 703 +4.1%

Like-for-like(1) +1.4%

Current operating

income24 25 +8%

Operating margin 3.5% 3.6% +10bp

Page 32: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

BENELUX IN 2018

Good sales performance in very competitive markets

Both Belgium and Netherlands delivering sales growth

Excellent Q4 performance with market share gains

Solid performance in Belgium

Growth at BCC despite store closures

Digital acceleration via first effects of the Wehkamp partnership

7 stores closed at BCC in 2018

BCC current operating income negatively impacted by:

Management fees accounting

Continuing network restructuration

Wehkamp partnership implementation costs

32

4.2%

-2.2% -1.6%

6.8%

2.1%

Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018

2018 sales evolution (2)

(1) Like-for-like: excluding FX, perimeter and expansion effects(2) At comparable scope of consolidation and at constant forex

€m 2017 2018 % Change

Revenues 917 936 +2.1%

Like-for-like(1) +2.1%

Current operating

income12 5 -€7m

Operating margin 1.3% 0.6% -70bp

Page 33: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

€m 2017 2018 % Change

Revenues 7,448 7,475 +0.4%

Gross Margin% Revenues

2,26130.4%

2,26530.3% -10bp

Total costs% Revenues

-1,991 -26.7%

-1,969 -26.3%

-40bp

Current operating

income270 296 +10%

% Revenues 3.6% 4.0% +40pb

2018 GROUP CURRENT OPERATING INCOME

Growth of sales despite tough markets

Strong control of gross margin, up +20bp

excluding the dilutive impact of franchises

Costs down, reflecting:

Fnac Darty synergies

Success of performance plans

Current operating income up +10%

Current operating margin up +40bp, at 4.0%,

from 2.7% two years ago

33

Page 34: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

€m 2017 2018

Current operating Income 270 296

Non-current operating income and expenses

-53 -39

Operating income 217 257

Financial charges -44 -43

o/w cost of net indebtedness -34 -36

o/w other financial charges (net) -10 -7

Tax charges -48 -65

Net income from continuingoperations

125 150

Discontinued operations -87 0

GROUP REPORTED FINANCIAL RESULTS

Strong current operating income growth

reflecting operational agility

Non-current items mainly reflecting cost of

implementation of synergies, and €20m fine from

Competition Authority

Financial charges reflecting cost of debt and

cost of consumer credit

Financial result impacted by one-off non-cash expenses of €6m, following the renegotiation of bank debt

€7m reflecting cost of consumer credit

2018 effective tax rate of 30% vs normative tax

rate of approx.40% including CVAE

Net income from continuing operations up +20%

34

Page 35: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

€m 2017 2018

EBITDA 370 399

Non-recurring cash elements(1) -17 -38

Cash flow from operations before tax,

dividends and interest(1) 353 361

Change in working capital 56 1

CAPEX(2) -112 -118

Tax -98 -72

Operating Free Cash flow(1) 199 173

STRONG FREE CASH FLOW GENERATION IN 2018

Cash impact of 2017 non-recurring elements

due to integration rollout

Working capital impact is positive despite high

comps in 2017 due to alignment of payment

terms between Fnac and Darty

Capex under control

35

(1) Excluding the impact of the €20m fine from the Competition Authority(2) Net of property disposals

Page 36: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

A STRONG LIQUIDITY POSITION

Return to a net cash position, only two years after the acquisition of Darty

Successful bank debt renegotiation in H1 2018, with improved terms and 2y maturity gain

100 million credit agreement signed with the European Investment Bank (EIB) with a maximum maturity of 9 years, at very attractive financing terms

Positive outlook granted by S&P in April 2018 and BBB- rating issued by Scope Ratings

Shareholder return: launch of a share buyback program for up to 2% of share capital

36

€m 31/12/2017 31/12/2018

Shareholders’ equity 1,103 1,261

Net Debt 86 (7)

Gross debt 861 911

Cash & cashequivalents

(775) (919)

Page 37: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

NET DEBT EVOLUTION IN 2018

37

-86

172

118

2011

48

361

7

Net cash

position at

December 31,

2017

Cash Flow from

operations

before tax,

dividend and

interest

Change in

working capital

requirement

Corporate

income tax paid

Operating

investments net

of disposals

Net financial

cost and other

items

Net cash

position at

December 31,

2018

Fine from French

Competition

Authority

Share

buyback

(1) Excluding the impact of the €20m fine from the Competition Authority

Including €38m of non-recurring cash elements

Operating Free Cash Flow: €173m(1)

Page 38: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

VISION AND 2019 KEY FOCUS

38

Accelerating our digital transformation

Focusing on Execution

Being even more Client centric

Nurturing Responsibility

“Digital Factory” and major investments in IT

Updated marketplace platform

Test and learn process to implement shopping innovations

Leverage trust and loyalty

Offer the best market omnichannel experience

Focus on team training to bring best in class customer

experience

Search for new standards addressing new consumption

trends and customers needs

Leading omnichannel player, with a competitive spirit

After successful integration, more scope for project

implementation

Committed to constantly offering clients more “choix

éclairés”

Pioneer in the circular economy

Foster cultural and technological diversity and accessibility

Higher growth than markets and 4.5% to 5% current operating marginMid-term objectives confirmed

CONFIANCE

Building future growth

Page 39: ISR PRESENTATION · isr presentation 2019. strategy. fnac darty omnichannel leader in europe

CONTACT

39

Le Flavia - 9, rue des Bateaux-Lavoirs -

94200 Ivry-sur-Seine

http://www.fnacdarty.com/

Stéphanie ConstandVP Investor Relations and FinancingDirectrice Relations Investisseurset Financement

Tel : +33 1 55 21 18 63

Mob. : +33 7 50 12 03 78

[email protected]

Marina LouvardInvestor Relations and Financing ManagerManager Relations Investisseurset Financement

Tel : +33 1 72 28 17 08

Mob. : +33 6 26 65 62 29

[email protected]

Valéria MaioGroup CSR managerResponsable RSE Groupe

Tel : +33 1 55 21 57 54

Mob. : +33 6 68 23 76 07

[email protected]

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DISCLAIMER

IMPORTANT NOTICE: By reading this presentation, you agree to be bound by the following limitations and qualifications: Certain information

included in this release is not based on historical facts but on forward-looking statements. Such forward-looking statements speak only as of the

date of this presentation and Fnac Darty expressly disclaims any obligation or undertaking to release any update or revisions to any forward-

looking statements in this presentation to reflect any change in expectations or any change in events, conditions or circumstances (or otherwise)

on which these forward-looking statements are based. Such forward looking statements are for illustrative purposes only. Investors are cautioned

that forward-looking information and statements do not guarantee future performance and are subject to various known and unknown risks and

uncertainties and other factors, many of which are difficult to predict and generally beyond the control of Fnac Darty, and could cause actual

results to differ materially from those expressed in, or implied or projected by, such forward-looking information and statements. These risks and

uncertainties include those discussed or identified in Chapter 6 “Facteurs de Risques” of the Fnac Darty 2018 registration document which has

been registered with the French Autorité des marchés financiers ("AMF") under n°D19-0166 on March 18th, 2019, and which is available on the

AMF's website at www.amf-france.org and on Fnac Darty’s website at www.fnacdarty.com.

This material was prepared solely for informational purposes and does not constitute and is not to be construed as a solicitation or an offer to buy

or sell any securities or related financial instruments in the United States of America or any other jurisdiction. Likewise it does not give and should not

be treated as giving investment advice. It does not reflect in any way the specific investment objectives, financial situation or particular needs of

any recipient. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the

information contained herein. It should not be regarded by recipients as a substitute for the exercise of their own judgment. Any opinions expressed

in this material are subject to change without notice.

This material is being furnished to you solely for your information, and it may not be reproduced, redistributed or published (whether internally or

externally to your company), directly or indirectly, in whole or in part, to any other person. Failure to comply with these restrictions may result in the

violation of legal restrictions in some jurisdictions.

The distribution of, or the access to, this release in certain jurisdictions may be subject to legal or regulatory restrictions. Accordingly, any persons

coming into possession of this document are required to inform themselves about and to observe any such restrictions. Fnac Darty expressly

disclaims any liability as to the violation of such restrictions by any person.

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41

ISR

PRESENTATION

2019