Rai Way

Investor Presentation • Jul 30, 2015

1H2015 Results Presentation

Rome, 30th July 2015

FORWARD LOOKING STATEMENTS

This presentation contains forward-looking statements regarding future events and the future results of Rai Way that are based on current expectations, estimates, forecasts, and projections about the industries in which Rai Way operates, as well as the beliefs and assumptions of Rai Way's management. In particular, certain statements with regard to management objectives, trends in results, margins, costs, rate of return and competition tend to be forward-looking in nature. Words such as "expects," "anticipates," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," and "estimates," variations of such words, and similar expressions, are intended to identify such forward-looking statements. These forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict because they relate to events and depend on circumstances that will occur in the future. Therefore, Rai Way's actual results may differ materially and adversely from those expressed or implied in any forward-looking statements. They are neither statements of historical fact nor guarantees of future performance. Rai Way therefore cautions against relying on any of these forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, economic conditions globally, the impact of competition, political, economic and regulatory developments in Italy. Any forward-looking statements made by or on behalf of Rai Way speak only as of the date they are made. Rai Way undertakes no obligation to update any forward-looking statements to reflect any changes in Rai Way's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.

Rai Way Participants

•Camillo Rossotto, Chairman

• •Stefano Ciccotti, Chief Executive Officer
• •Adalberto Pellegrino, Chief Financial Officer
• •Giancarlo Benucci, Head of Investor Relations

1H2015 Financial Highlights

F i i l H i h l i h t n a n c a g g s
% Eur M ln,	2 Q 2 0 4 1 P F	2 Q 2 0 1 5	% Yo Y	2 0 4 1 H 1 P F	2 0 1 H 1 5	% Yo Y
Co Re re ve nu es	5 1, 7	2, 6 5	% 1, 7	0 3, 1 5	0 0 1 5,	4 % 1,
O t he Re r ve nu es	1, 3	0, 3	-7 8, 2 %	1, 5	0, 5	-6 7, 1 %
A d j te d E B I T D A us % in m ar g	2 8, 1 % 5 4, 3	2 7, 9 % 5 3, 0	-0 8 % ,	5 3, 1 % 5 1, 3	5 3, 9 % 5 1, 4	1, 5 %
Ne t Inc om e	1 0, 4	1 0, 5	% 0, 7	1 8, 0	1 9, 8	% 1 0, 0
(1 ) Ca p ex % on c or e re ve nu es	4, 6 9, 0 %	4, 1 8 % 7,		6, 5 6, 2 %	7, 1 6, % 7
( 2) io Ca h s co nv er s n	8 3, % 5	8 3 % 5,		8 9 % 7,	8 6, 9 %
				2 0 1 4 F Y P F	1 H 2 0 1 5
( 3) Ne t De b t t b t / l l ing d Ne De 1 Y r A o	j. E B I T D A			6 5, 5 0, 6 2x	7 2, 5 0, 6 9x

In 1H2014, Pro Forma figures assume the impact of the new service contracts with RAI as effective from ¹st January ²⁰¹⁴

• •1H15 Core revenues at € 105,0m, up 1,4% vs. 1H14
• •1H15 Adjusted EBITDA at € 53,9m, with EBITDA margin of 51,4%
• •2Q15 Adjusted EBITDA margin impacted by lower level of Other Revenues
• •1H15 Net Income at € 19,8m, up 10,0% vs. 1H14
• •Capex at € 7,1m (cash conversion at 86,9%), reflecting typical distribution throughout the year
• •Net Debt at € 72,5m (after dividend payment in May 2015), with Net Debt/1Y rolling Adj. EBITDA at 0,69x

(1) 2Q14 and 1H14 Capex include investments in tangible and intangible assets and financial lease cash-out, representing network capex according to the old service agreemen^t with RAI (being treated as ^a financial lease)

(2) Cash conversion= (Adj. EBITDA – Capex) / Adj. EBITDA

(3) 2014FY PF Net debt consists of the Net Financial Position (determined in compliance with paragrap^{h 127} of the recommendations contained in the document prepared by ESMA, no. ³¹⁹ of 2013, implementing Regulation 2004/809/EC) excluding the current financial receivables relating to the financial leasing with RAI

Core Revenues

Eur Mln; %

• •Revenues from RAI driven by the step-up in the fixed consideration included in the service contract (from € 171m in ²⁰¹⁴ to € 175m in 2015, on ^a yearly basis)
• •1H15 Third Party performance impacted by lower Tower Rental revenues, mainly from non-MNOcustomers, and lower Network Services revenues

Third Party Revenues breakdown

Eur Mln; %

•Tower Hosting stable at 94,0% of Third Party revenues

Opex

Eur Mln; %

• Personnel costs up 3,3% vs. 1H14 mainly driven by completion of organizational structure after IPO•
• Other Operating costs declined by 3,8% vs. 1H14, mainly driven by maintenance, utilities and ICT intercompany services •

From Adjusted EBITDA to Net Income

			P & L
Eur Ml n, %	2 Q 2 0 1 4 P F	2 Q 2 0 1 5	% Yo Y	1 H 2 0 1 4 P F	1 H 2 0 1 5	% Yo Y
d j. A E B I T D A % in ma rg	2 8, 1 % 5 4, 3	2 9 7, % 5 3, 0	-0, 8 %	3, 5 1 % 5 1, 3	3, 9 5 % 5 1, 4	% 1, 5
On f f e- o	0, 0	-0, 1		0, 0	-0, 1
E B I T D A	2 8, 1	2 7, 7	-1, 2 %	5 3, 1	5 3, 8	1, 2 %
% in ma rg	5 4, 3 %	5 2, 7 %		5 1, 3 %	5 1, 2 %
(1) D A &	-1 2, 1	-1 1, 6	-4, 1 %	-2 4, 8	-2 3, 3	-5, 9 %
E B I T	1 5, 9	1 6, 1	% 0, 9	2 8, 3	3 0, 5	% 7, 5
F ina ia l e nc xp en se s	-0, 4	-0, 6	2 9, 5 %	-0, 9	-1, 0	1 9, 7 %
f i Pre Ta Pro t x	1 5, 5	1 5, 5	0, 2 %	2 7, 5	2 9, 4	% 7, 1
Ta xe s	-5, 1	-5, 1	% -0, 9	-9, 5	-9, 6	% 1, 7
% tax te ra	3 2, 9 %	3 2, 6 %		3 4, % 5	3 2, 8 %
Ne t Inc om e	1 0, 4	1 0, 5	0, 7 %	1 8, 0	1 9, 8	1 0, 0 %
(2) E P S	0, 0 3 8 3	0, 0 3 8 6		0, 0 6 6 1	0, 0 2 7 7

• •1H15 EBITDA at € 53,8m, up 1,2% vs. 1H15, with ^a margin of 51,2%
• •1H15 EBITDA including non recurring expenses of € 0,1m
• •Declining D&A (€ -1,5m vs. 1H14) mainly resulting from reduction of Capex vs. "switch-off period"
• •1H15 Tax rate at 32,8%, with improvement mainly driven by higher deductibility of personnel costs from IRAP-taxable income
• •1H15 Net Income at € 19,8m, up 10,0% vs. 1H14

Cash Flow generation

Net Debt/1y rolling Adj. EBITDA

Eur Mln; %

• •Cash generation pre-dividend payment of ca. € 26,7m
• •Capex level reflects typical distribution throughout the year
• •Trade receivables back to normal level after build up in 1Q15

Balance Sheet

Eur Mln

1H2015 Balance Sheet

• Conservative capital structure with € 72,5mNet Debt as of June 2015:

0.69x Net Debt/1y-rolling Adj. EBITDA

2015 Outlook confirmed

•EBITDA

²⁰¹⁵ EBITDA expected to increase by ∼€ 2m compared to ²⁰¹⁴ level

•Capex

²⁰¹⁵ Capex expected at ∼ € 40m, including maintenance and first tranche of development capex for new services to RAI

•Net Debt

2015YE Net Debt targeted at ∼€ 50m

2015-2019 Industrial Plan to be presented in September

Q & A session

Contacts

i t U p c o m n g e e n s v
D t a e	E t v e n
S b 2 0 t 1 5 e p e m e r	2 0 9 d i l l 1 5- 1 I t P n u s r a a n
0 3 / 1 1 / 2 0 1 5	3 Q 1 5 l t r e s s u

Appendix

Detailed summary of Income Statement

€m % ) ;	2Q 14	2Q 14 PF	2Q 15	14 1H	14 1H PF
re rev en ue s	28 .1	51 .7	52 .6	63 .4	10 3.5
he r re ve nu es	1.3	1.3	0.3	1.5	1.5
rch of ble ase co nsu ma s	( 0.3 )	( 0.3 )	( 0.3 )	( 0.8 )	( 0.8 )
rvi sts ce co	( 13 .1)	( 12 .3)	( 12 .4)	( 28 .0)	( 26 .4)
el sts rso nn co	( 11 .4)	( 11 .4)	( 11 .5)	( 23 .1)	( 23 .1)
he ost r c s	( 0.9 )	( 0.9 )	( 0.9 )	( 1.6 )	( 1.6 )
Op ex	( 25 .8)	( 24 .9)	( 25 .2)	( 53 .5)	( 51 .9)
D& A	( 0.1 )	( 12 .1)	( 11 .6)	( 0.3 )	( 24 .8)
vis ion s	0.0	0.0	0.0	0.0	0.0
ing ofi t O rat t pe pr	3.6	15 .9	16 .1	11 .2	28 .3
t F ina e i nc nc om e	1.6	( 0.4 )	( 0.6 )	3.2	( 0.9 )
fit b efo inc e t re om ax es	5.2	15 .5	15 .5	14 .4	27 .5
e t om ax es	( 1.9 )	( ) 5.1	( ) 5.1	( 5.4 )	( 9.5 )
fit f the or ye ar	3.3	10 .4	10 .5	9.0	18 .0
TD A	3.6	28 .1	27 .7	11 .4	53 .1
TD A m in arg	12. 9%	54 .3%	52 .7%	18. 0%	51 .3%
ing n r ec urr ex pe nse s	0.0	0.0	( ) 0.1	0.0	0.0
jus ted EB ITD A	3.6	28 .1	27 .9	11 .4	53 .1
jus in ted EB ITD A m arg	9% 12.	.3% 54	.0% 53	0% 18.	.3% 51

Summary of Balance Sheet

( €m )	2 0 4 1 F Y	2 0 1 H 1 5
No t a ts n c urr en sse
i b le ts Ta ng ass e	2 4 3. 1	2 2 0 7.
In ta i b le ts ng ass e	0. 6	0. 6
No t f ina ia l a ts n-c urr en nc sse	0. 6	0. 5
No t tax ts n-c urr en as se	5. 4	5. 3
ta l n t a ts To on cu rre n sse	2 4 9. 8	2 3 3. 5
Cu t a ts rre n sse
ies Inv to en r	0. 9	0 1.
de iva b les Tra re ce	6 4. 4	6 5. 5
O t he iva b les d c t r re ce an urr en	4. 4	5.
ts ass e		1
Cu t f ina ia l a ts rre n nc sse	0. 7	0. 5
Ca h s	1 4. 7	4 7. 8
Tax ts as se	0. 3	0. 3
l c To ta t a ts urr en sse	8 3 5.	2 0. 2 1
O S S S T T A L A E T	3 3 5. 1	3 3. 5 7

( €m )	2 0 1 4 F Y	1 H 2 0 1 5
No t a ts Eq n c i ty urr en sse u
i S ha ta l re ca p	7 0. 2	7 0. 2
Le l re g a se rve s	6. 9	8. 1
O t he r re se rve s	3 7. 1	3 7. 1
Re ta ine d e ing arn s	3 9. 6	2 5. 0
To ta l e i ty q u	1 5 3. 8	1 4 0. 4
No t l ia b i l i t ies n-c urr en
t f ina ia l l ia b i l i t ies No n-c urr en nc	8 0. 6	0 6 1 5.
Em loy be f i ts p ee ne	2 1. 3	2 0. 6
is ion for is ks d c ha / Pro v s r an rg es	1 8. 6	1 8.
A l low an ce s		1
ia i i ies O t he t l b l t r n on -cu rre n	0. 0	0. 0
t tax l ia b i l i t ies No n-c urr en	0. 0	0. 0
ia i i ies To ta l n t l b l t on -cu rre n	1 2 0. 5	1 4 4. 3
ia i i ies Cu t l b l t rre n
Co ia l de b t mm erc	3 6. 0	3 0. 4
O t he de b t a d c t l ia b i l i t ies r n urr en	2 1. 7	2 0. 9
f ina ia ia i i ies Cu t l l b l t rre n nc	0. 3	1 5. 3
l ia b i l i t ies Tax	2. 9	2. 4
ia i i ies To ta l c t l b l t urr en	6 0. 8	6 9. 0
O Q S T T A L N E T E U I T Y A N D L I A B I L I T I E	3 3 5. 1	3 3. 5 7

Summary of Cash Flow Statement

(€m )	2Q 201 4	2Q 201 5	1H2	014 1H2	015
Ear nin gs b efo re t axe s	5.2	15.5	14.4	29.	4
D& A	0.1	11.6	0.3		23. 3
Pro visi d o the ons an rs	(0.7 )	(1.3 )	(0.1	)	(1.3 )
Net fin ial Inc anc om e	(1.6 )	0.6	(3.2	)	1.0
Oth net ite er n on- mo ary ms	(0.6 )	0.0	(0.6	)	0.0
Net ting CF be fore ch e W C op era ang	2.4	26. 4	10. 7	52.	5
Cha in inv ent orie nge s	(0.0 )	(0.1 )	0.0		(0.1 )
Cha in t re cei ble nge acc oun va s	2.3	19.9	(8.9	)	(1.2 )
in Cha t pa yab les nge acc oun	(43 .5)	(4.8 )	(46	.1)	(5.6 )
in Cha oth ts nge er a sse	(4.7 )	0.3	(8.7	)	(0.7 )
Cha in oth er l iab iliti nge es	(11 .8)	(7.5 )	1.8		2.0
of fun Use ds	(0.0 )	(0.1 )	(0.1	)	(0.1 )
f em nef its Pay nt o plo be me yee	(0.6 )	0.8	(1.4	)	0.5
Cha in t dit/ liab iliti nge ax cre es	0.0	0.4	(0.9	)	(0.5 )
aid Tax es p	(5.2 )	(12 .4)	(5.2	) (12	.4)
ting sh f Net low op era ca	(61 .1)	22. 8	(58 .7)	34.	3
nt i ngi Inv est n ta ble ets me ass	(0.0 )	(4.0 )	(0.0	)	(6.9 )
f ta ngi Sal ble ets e o ass	0.0	0.1	0.0		0.1
nt i n in gib le a Inv est tan ts me sse	(0.0 )	(0.1 )	(0.0	)	(0.1 )
Sal f in gib le a tan ts e o sse	0.0	0.0	0.0		0.0
Fina nci al l ash t eas e c -ou	(4.6 )	0.0	(6.4	)	0.0
Fina nci al l ash -in eas e c	19. 1	0.0	31.	1	0.0
Cha in t fin ial ets nge non -cu rren anc ass	(0.0 )	0.0	0.0		0.0
cei Inte t re ved res	2.0	0.0	3.9		0.1
esti h flo Inv ng cas w	16.4	(4.0 )	28. 6		(6.9 )
(De )/in in lon de bt g-t cre ase cre ase erm	(0.1 )	(0.0 )	(0.1	)	25. 0
(De )/in in t lia bilit ies cre ase cre ase cur ren	56. 1	0.3	41.	8	15.0
Cha in t fin ial ets nge cur ren anc ass	0.0	(0.3 )	0.0		0.2
Inte t pa id res	(0.2 )	(0.5 )	(0.5	)	(0.9 )
Div ide id nds pa	(11 .2)	(33 .6)	(11	.2) (33	.6)
Fina nci h flo ng cas w	44. 6	(34 .0)	30. 1		5.8
Cha in h a nd h e qui val ent nge cas cas	0.0	(15 .1)	0.0		33. 2
(*) q (B of iod ) Ca sh a nd h e Per cas eg.	0.0	63. 0	0.0		14.7
(*) Ca sh a nd h e q (E nd of P erio d) cas	0.0	47. 8	0.0		47. 8

17 30 July 2015 1H2015 Results

(1) In 1H2014, financial lease cash-out represents network capex, due to the old service agreement with RAI being treated as a financial lease

(2) In 1H2014, cash-pooling agreement with RAI