Dovalue

Investor Presentation • Nov 6, 2020

Financial Results to September 30th 2020

November 6th, 2020

9M 2020 key messages

1

1 Positive momentum in Q320 earnings, confirming the recovery path

• Monthly collections trends into October, at Group level, in line with base case of COVID-impact
• 3Q20 EBITDA at €41.1m, +163% vs 2Q20 EBITDA
• Sequential improvement in EBITDA ex NRI margin (27% in 9M20 vs 21% in 1H20)
• Stable Net Working Capital trend and Capex increase in line with expectations (Group IT integration projects)
• doValue Greece ahead of expectations, on the back of higher liquidations and restructuring

2 €8.6bn new mandates, meeting our yearly €9-€11bn target despite COVID-19

• GBV growth to €163bn, confirming doValue leadership in loan and real estate servicing in Southern Europe
• +€5.5bn GBV from 3 new servicing mandates won in Greece, Italy and Spain
• +€3.1bn GBV from forward flow agreements, above FY20 €2.0bn guidance despite banking moratoria
• Significant short-term pipeline at more than €25bn, positive news expected by year-end

3 Responsive business model, ready to capitalize on market opportunity

• Pro-forma leverage at 2.4x following the acquisition of doValue Greece; covenant levels (including amendment) provide ample headroom into end of 2021 to face any possible worst case negative COVID-related scenarios
• COVID restrictions in place allow for normalized operational activity, doValue fully operational from remote
• Servicing sector expected to consolidate, with current scenario amplifying gap between top and worst performers

Third quarter collections slightly above expectations

Strong servicing pipeline and supportive operating/regulatory environment

• Temporary banking moratoria in place across markets: no impact on current GBV under management, potential to delay new flows
• Several Governmental schemes in place to support vulnerable debtors and help restructuring of SMEs in most cases maturing in Dec. 2021

Operational update

Regulatory update

• doValue team fully operational across markets and adjusting recovery/sales strategies to account for current environment
• Activity of legal courts already normalized in Iberia while still below full operational capacity in Italy and Hellenic Region
• Key items to watch: frequency and volume of real estate auctions and volume of real estate transactions

FY20 target of +€9-11bn new mandates nearly achieved as of September

Financial Review

Summary financial highlights

		9M192	1 9M20	∆ (%)
e s u er n	GBV EoP	€132.4bn	€159.1	+20%	 GBV more than doubling over the past year as doValue consolidates #1 position in South Europe  GBV at €163bn including the Icon and Iccrea
e v v ri e d R	Gross collections	€2.2bn	€2.8bn	+29%	Banca portfolios, currently onboarding  Collections trend in line with expectations, progressing towards normalization
	Gross revenues	€233.4m	€280.8m	+20%	 Base fees at 38% of revenues (€106 million), adding to resiliency  doValue Greece slightly ahead of expectations
L & e r P u e ct pl u str m Si	Operating costs ex NRIs3	€119.2m	€170.8m	+43%	 International expansion limiting the temporary COVID-19 impact on earnings
	EBITDA ex NRI3	€90.6m	€76.2m	-16%	 Cost efficiency results: all main cost lines down year-on-year on a pro-forma basis  3Q20 EBITDA +163% vs 2Q20 EBITDA
	EBITDA ex NRI3 margin	39%	27%	- 12 p.p.	 Reported 9M20 EBITDA at €68m EBITDA ex NRI growing year-on-year if one-off  indemnities are excluded from 9M20 and 9M19
	Net income ex NRI	€39.4m	€3.5m	n.m.	 Net Income impacted by non-cash D&A charges and turning positive in 3Q20 and 9M20
n o h ati s er a C n e g	Net Financial Position	€257.5m	€411.1m	+60%	PF leverage at 2.4x due to the acquisition of FPS  (now doValue Greece). Amended covenants provide wide headroom
	Net Debt/ PF4 EBITDA	1.5x	2.4x	+0.9x	 Cash position at €170 million, in addition to €80 million untapped credit lines

Notes: 1: Altamira Asset Management is consolidated from July 2019, doValue Greece (formerly Eurobank FPS) is consolidated from June 2020. 2: Restated following the completion of the Purchase Price Allocation process related to Altamira AM. 3: Non-recurring items include transaction costs connected with the acquisition of Altamira AM, doValue Greece (formerly Eurobank FPS), the Group reorganisation project and costs referred to Covid-19. 4: LTM Pro Forma EBITDA including the acquisition of Altamira AM and doValue Greece (formerly Eurobank FPS)

Evolution of gross book value (GBV) under management

• Assets under management continue to diversify (more asset classes and markets) and grow organically and via M&A
• Inflows from existing clients (forward flow agreements with Unicredit, Santander, Alpha Bank) already +50% above FY20 expectations, despite banking moratoria in place
• Inflows from new clients above the 1H20 figure due to the Efesto UTP mandate in Italy (already under management)
• Icon portfolio award in Greece and Iccrea GACS award in Italy would bring total GBV to €163bn
• Collections and REO sales improving in line with expectations but still affected by legal system not operating at full capacity

GBV details: one of the most diversified portfolios in the industry

Revenue composition: resiliency in base fees and ancillary revenues

Base fees nearly doubling as a proportion of revenues at 38%, providing a hedge to current scenario

• Structural higher exposure to Spain, Greece and Cyprus (base fees ca. 10-15bps vs Italy at ca. 5bps)
• Variable fees discount the temporary reduction due to COVID-19 (postponement of collections)
• Outsourcing fees higher in absolute terms due to consolidation of Altamira Asset Management and linked to REO services. Excluding M&A, NPL outsourcing fees continue trending down year-on-year

Focus on operating expenses

• Growth in overall cost only due to larger perimeter (Altamira Asset Management and doValue Greece)
• Excluding M&A, total operating costs are down 21% year-on-year, and headcount is down from ca. 1,250 to ca. 1,070 (Italy and doValue Hellas)
• Total Operating Expenses shown here do not include €8.2m Non Recurring Items, mostly related to M&A transaction costs
• Reduction in variable HR cost, from 14% of total HR cost in YE19 to 4% in 9M20
• Lower overall HR cost as a proportion of total cost (from 75% to 71%), also benefiting from Governmental HR cost support programs currently (mostly in Italy)
• Reduced IT and business process outsourcing costs, discounting early benefits of IBM outsourcing
• Real Estate costs down also due to reduction of number of offices in Italy and lower use of co-working space

Financial highlights by geography

• Structurally higher collection rates in markets ex-Italy, due to shorter timing of legal procedures
• Collections and REO sales trending towards normalization, still affected by legal courts operating below capacity and enforcing Governmental measures in place to limit the spread of COVID-19
• Italy EBITDA compares with 9M19 EBITDA which included one-off indemnity fees
• Spain and Portugal progressing in line with expectations, supported by REO sales and real estate market holding up
• Strong results in Greece and Cyprus, with accretive profitability and downside protection in the form of higher than average base fees. doValue Greece (formerly FPS) tracking ahead of expectations

Notes: 1: Including REO sales and excluding doValue Greece (given the mix of restructuring and liquidation activities, not captured by collections).

NWC and net financial position

• Stable NWC as compared with 1H20 results, confirming improvement vs YE19 on the back of both lower receivables and higher payables
• Client shift towards investors (paying quicker vs banks) and doValue Greece contracts are key structural NWC positives
• No sign of stress in payments by customers due to Covid-19

• As expected, leverage at 2.4x, covenants provide significant headroom even in case of unforeseen external shocks
• Liquidity further strengthened by undrawn revolving credit facilities of ca. €80m
• No refinancing needs until 2025

Net debt trend

• Confirmed highly cash generative nature of business, with positive NWC trend, and limited capex, cash taxes
• Growth in Net Debt only due to acquisition of doValue Greece, closed on June 5th 2020
• Free cash flow generation at €61m in 9M20, supported by positive trend in Net Working Capital

Condensed consolidated income statement

	9 /3 0 /2 0 2 0	9 /3 0 /2 0 19 RESTATED	Cha nge €	Cha nge %
Servicing Revenues:	255,170	206,586	48,584	24%
o/w: NPE revenues	209,789	173,654	36,135	21%
o/w: REO revenues	45,381	32,932	12,449	38%
Co- investment revenues	372	477	(105)	(22)%
Ancillary and other revenues	25,269	26,289	(1,020)	(4)%
Gross re ve nue s	2 8 0 ,8 11	2 3 3 ,3 5 2	4 7 ,4 5 9	20%
NPEOutsourcing fees	(15,028)	(12,396)	(2,632)	21%
REO Outsourcing fees	(11,004)	(5,143)	(5,861)	114%
Ancillary Outsourcing fees	(7,804)	(5,990)	(1,814)	30%
Ne t re ve nue s	2 4 6 ,9 7 5	2 0 9 ,8 2 3	3 7 ,15 2	18 %
Staff expenses	(121,782)	(89,266)	(32,516)	36%
Administrative expenses	(57,152)	(41,785)	(15,367)	37%
Total "o.w. IT"	(18,800)	(12,462)	(6,338)	51%
Total "o.w. Real Estate"	(3,851)	(3,719)	(132)	4 %
Total "o.w. SG&A"	(34,501)	(25,604)	(8,897)	35%
Ope ra ting e xpe nse s	(17 8 ,9 3 4 )	(13 1,0 5 1)	(4 7 ,8 8 3 )	37%
EBITDA	6 8 ,0 4 1	7 8 ,7 7 2	(10 ,7 3 1)	(14 )%
EBITDA ma rgin	24%	34%	(10 )%	(2 8 )%
Non- recurring items included in EBITDA¹⁾	(8,184)	(11,857)	3,673	(31)%
EBITDA excluding non- recurring items	76,225	90,629	(14,404)	(16)%
EBITDA margin excluding non- recurring items	27%	39%	(12)%	(30)%
Net write- downs on property, plant, equipment and intangibles	(49,733)	(32,476)	(17,257)	53%
Net provisions for risks and charges	(7,106)	(7,456)	350	(5)%
Net write- downs of loans	5 7	553	(496)	(90)%
Profit (loss) from equity investments	(2)	-	(2)	n.s.
EBIT	11,2 5 7	3 9 ,3 9 3	(2 8 ,13 6 )	(7 1)%
Net income (loss) on financial assets and liabilities measured at fair value	231	1,093	(862)	(79)%
Financial interest and commissions	(12,360)	(4,893)	(7,467)	n.s.
EBT	(8 7 2 )	3 5 ,5 9 3	(3 6 ,4 6 5 )	(10 2 )%
Non- recurring items included in EBT²⁾	(14,308)	(17,676)	3,368	(19)%
EBT excluding non- recurring items	13,436	53,269	(39,833)	(75)%
Income tax for the period	(7,906)	(20,283)	12,377	(61)%
PROFIT (LOSS) FOR THE PERIOD	(8 ,7 7 8 )	15 ,3 10	(2 4 ,0 8 8 )	n.s.
Profit (loss) for the period attributable to Non- controlling interests	644	(2,015)	2,659	(132)%
PROFIT (LOSS) FOR THE PERIOD ATTRIBUTABLE TO THE SHAREHOLDERS OF THE PARENT COMPANY	(8 ,13 4 )	13 ,2 9 5	(2 1,4 2 9 )	n.s.
Non- recurring items included in Profit (loss) for the period	(12,142)	(26,346)	14,204	(54)%
O.w. Non- recurring items included in Profit (loss) for the period attributable to Non- controlling interest	(459)	(196)	(263)	134%
Profit (loss) for the period attributable to the Shareholders of the Parent Company excluding non
recurring items	3,549	39,445	(35,896)	(91)%
Profit (loss) for the period attributable to Non- controlling interests excluding non- recurring items	(185)	-	(185)	n.s.
Ea rnings pe r sha re (in Euro)	(0 .10 )	0 .17	(0 .3 )	n.s.
Earnings per share excluding non- recurring items (Euro)	0.04	0.49	(0.45)	(91)%

Notes:

1: Non-recurring items in Operating expenses include the costs connected with the acquisition of Altamira Asset Management S.A., of doValue Greece (ex Eurobank Financial Planning Services), those incurred for the Group reorganisation project and costs referred to Covid-19

2: Non-recurring items included below EBITDA mainly refer to (i) termination incentive plans that have therefore been reclassified from personnel expenses, (ii) income taxes and (iii) fair value delta of the Put-Option and Earn-out

Pro forma¹ condensed consolidated income statement

€/'000

	9 /3 0 /2 0 2 0	9 /3 0 /2 0 19	Cha nge €	Cha nge %
Servicing Revenues:	309,738	435,685	(125,947)	(29)%
o/w: NPE revenues	264,357	351,239	(86,881)	(25)%
o/w: REO revenues	45,381	84,446	(39,065)	(46)%
Ancillary and other revenues	25,710	34,103	(8,393)	(25)%
Gross re ve nue s	3 3 5 ,4 4 8	4 6 9 ,7 8 8	(13 4 ,3 3 9 )	- 2 9 %
Outsourcing fees	(35,932)	(51,367)	15,435	(30)%
Ne t re ve nue s	2 9 9 ,5 16	4 18 ,4 2 1	(118 ,9 0 5 )	- 2 8 %
Staff expenses	(139,145)	(156,124)	16,978	(11)%
Administrative expenses	(58,857)	(68,207)	9,350	(14)%
Ope ra ting e xpe nse s	(19 8 ,0 0 2 )	(2 2 4 ,3 3 1)	2 6 ,3 2 9	- 12 %
EBITDA	101,514	194,090	(92,576)	(48)%
EBITDA margin	0	0	(0)	(27)%
EBITDA¹⁾ Non- recurring items included in	(2,990)	(3,543)	553	(16)%
EBITDA e xc luding non- re c urring ite ms	10 4 ,5 0 4	19 7 ,6 3 3	(9 3 ,12 9 )	(4 7 )%
EBITDA ma rgin e xc luding non- re c urring ite ms	3 1%	42%	(11)%	(2 6 )%

Condensed consolidated balance sheet

€/'000

	9 /3 0 /2 0 2 0	12 /3 1/2 0 19 RESTATED	Cha nge Amount	Cha nge %
Cash and liquid securities (€/1000)	170,267	128,162	42,105	33%
Financial assets	54,591	48,609	5,982	12%
Property, plant and equipment	39,113	23,904	15,209	64%
Intangible assets	257,497	289,585	(32,088)	(11)%
Tax assets	108,679	98,554	10,125	10%
Trade receivables	143,117	176,991	(33,874)	(19)%
Assets held for sale	10	10	-	n.s.
Consolidation differences to be allocated	225,774	-	225,774	n.s.
Other assets	20,676	14,378	6,298	44%
TOTAL ASSETS	1,0 19 ,7 2 4	7 8 0 ,19 3	2 3 9 ,5 3 1	3 1%
Financial liabilities: due to banks	581,393	364,627	216,766	59%
Other financial liabilities	95,823	69,642	26,181	38%
Trade payables	39,236	46,969	(7,733)	(16)%
Tax Liabilities	37,459	32,806	4,653	14%
Employee Termination Benefits	10,595	8,544	2,051	24%
Provision for risks and charges	14,791	25,669	(10,878)	(42)%
Liabilities held for sale	-	-	-	n.s.
Other liabilities	40,238	25,196	15,042	60%
TOTAL LIABILITIES	8 19 ,5 3 5	5 7 3 ,4 5 3	2 4 6 ,0 8 2	43%
Share capital	41,280	41,280	-	n.s.
Reserves	163,961	127,041	36,920	29%
Treasury shares	(103)	(184)	8 1	(44)%
Profit (loss) for the period attributable to the Shareholders of
the Parent Company	(8,134)	38,603	(46,737)	(121)%
NET EQUITY ATTRIBUTABLE TO THE
SHAREHOLDERS OF THE PARENT COMPANY	19 7 ,0 0 4	2 0 6 ,7 4 0	(9 ,7 3 6 )	(5 )%
TOTAL LIABILITIES AND NET EQUITY ATTRIBUTABLE TO THE SHAREHOLDERS OF THE
PARENT COMPANY	1,0 16 ,5 3 9	7 8 0 ,19 3	2 3 6 ,3 4 6	30%
NET EQUITY ATTRIBUTABLE TO NON- CONTROLLING INTERESTS	3,185	-	3,185	n.s.
TOTAL LIABILITIES AND NET EQUITY	1,0 19 ,7 2 4	7 8 0 ,19 3	2 3 9 ,5 3 1	3 1%

Consolidated cash flow

€/'000

	9 /3 0 /2 0 2 0	9 /3 0 /2 0 19 RESTATED
EBITDA	68,041	78,772
Capex	(13,653)	(4,760)
EBITDA- Ca pe x	5 4 ,3 8 8	7 4 ,0 12
as % of EBITDA	80%	94%
Adjustment for accrual on share- based incentive system payments	1,847	3,707
Changes in NWC (Net Working Capital)	35,093	32,645
Changes in other assets/liabilities	(21,454)	(23,942)
Ope ra ting Ca sh Flow	6 9 ,8 7 4	8 6 ,4 2 2
Tax paid (IRES/IRAP)	(9,156)	(8,201)
Fre e Ca sh Flow	6 0 ,7 18	7 8 ,2 2 1
(Investments)/divestments in financial assets	(22,147)	(6,334)
Equity (investments)/divestments	(211,357)	(360,998)
Dividend paid	(1,875)	(36,264)
Ne t Ca sh Flow of the pe riod	(17 4 ,6 6 1)	(3 2 5 ,3 7 5 )
Net financial Position - Beginning of period	(236,465)	67,911
Net financial Position - End of period	(411,126)	(257,464)
Cha nge in Ne t Fina nc ia l Position	(17 4 ,6 6 1)	(3 2 5 ,3 7 5 )

Key Performance Indicators

KPIs (€/1000)	9 /3 0 /2 0 2 0	9 /3 0 /2 0 19 RESTATED	12 /3 1/2 0 19
Gross Book Value (EoP) - Group¹⁾	159,142,312	158,804,856	157,600,134
Gross Book Value (EoP) - Italy	76,087,611	77,079,160	78,796,103
Collections of the period - Italy	924,991	1,235,420	1,893,198
LTM Collections - Italy	1,582,769	1,862,598	1,893,198
LTM Collections - Italy - Stock	1,536,035	1,804,343	1,794,339
LTM Collections / GBV EoP - Italy - Overall	2.1%	2.4%	2.4%
LTM Collections / GBV EoP - Italy - Stock	2.1%	2.5%	2.5%
Staff FTE / Totale FTE Group	39%	33%	38%
LTM Collections / Servicing FTE - Italy	2.3	2.7	2.6
EBITDA	68,041	78,772	127,766
Non-recurring items (NRIs) included in EBITDA	(8,184)	(11,857)	(12,676)
EBITDA excluding non-recurring items	76,225	90,629	140,442
EBITDA M argin	24%	34%	35%
EBITDA M argin excluding non-recurring items	27%	39%	39%
Profit (loss) for the period attributable to the shareholders of the parent company	(8,134)	13,295	38,318
Non-recurring items included in Profit (loss) for the period attributable to the Shareholders of the Parent Company	(11,683)	(26,150)	(31,135)
Profit (loss) for the period attributable to the Shareholders of the Parent Company excluding non-recurring items	3,549	39,445	69,062
Earnings per share (Euro)	(0.10)	0.17	0.48
Earnings per share excluding non-recurring items (Euro)	0.04	0.49	0.86
Capex	13,653	4,759	8,086
EBITDA - Capex	54,388	74,013	119,680
Net Working Capital	103,881	123,171	130,022
Net Financial Position	(411,126)	(257,464)	(236,465)
Leverage (Net Debt / EBITDA LTM PF)	2,4x	1,5x	1.3x

^¹⁾ In orde r to e nha nc e the c ompa ra bility of Gross Book Va lue (GBV) a s of:

• 9/30/2019 the values for doValue Greece have been included at the reference date

• 12/31/2019 the values for doValue Greece have been included at the reference date

Simple debt structure with no refinancing needs before 2025

• Historically a net-cash business, doValue took advantage of the debt market in 2019 and 2020 to support its international M&A strategy, within its stated max 3x leverage (Net Debt/EBITDA) policy
• Access to bond market provides for greater diversification and flexibility of funding base
• Structurally high cash generation covers the yearly debt schedule, limited to the amortization of bank debt
• Current liquidity at more than €250m with no refinancing needs before 2025 (bond maturity)

Tax assets

Disclaimer

This presentation and any materials distributed in connection herewith (together, the "Presentation") do not constitute or form a part of, and should not be construed as, an offer for sale or subscription of or solicitation of any offer to purchase or subscribe for any securities, and neither this Presentation nor anything contained herein shall form the basis of, or be relied upon in connection with, or act as an inducement to enter into, any contract or commitment whatsoever. The information contained in this Presentation has not been independently verified and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness, reasonableness or correctness of the information or opinions contained herein. None of doValue S.p.A., its subsidiaries or any of their respective employees, advisers, representatives or affiliates shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection with this Presentation. The information contained in this Presentation is provided as at the date of this Presentation and is subject to change without notice.

Statements made in this Presentation may include forward-looking statements. These statements may be identified by the fact that they use words such as "anticipate", "estimate", "should", "expect", "guidance", "project", "intend", "plan", "believe", and/or other words and terms of similar meaning in connection with, among other things, any discussion of results of operations, financial condition, liquidity, prospects, growth, strategies or developments in the industry in which we operate. Such statements are based on management's current intentions, expectations or beliefs and involve inherent risks, assumptions and uncertainties, including factors that could delay, divert or change any of them. Forward-looking statements contained in this Presentation regarding trends or current activities should not be taken as a representation that such trends or activities will continue in the future. Actual outcomes, results and other future events may differ materially from those expressed or implied by the statements contained herein. Such differences may adversely affect the outcome and financial effects of the plans and events described herein and may result from, among other things, changes in economic, business, competitive, technological, strategic or regulatory factors and other factors affecting the business and operations of the company. Neither doValue S.p.A. nor any of its affiliates is under any obligation, and each such entity expressly disclaims any such obligation, to update, revise or amend any forward-looking statements, whether as a result of new information, future events or otherwise. You should not place undue reliance on any such forward-looking statements, which speak only as of the date of this Presentation. It should be noted that past performance is not a guide to future performance. Please also note that interim results are not necessarily indicative of full-year results.

Certification of the financial reporting officer

Elena Gottardo, in her capacity as the officer responsible for preparing corporate accounting documents, certifies – pursuant to Article 154-bis, paragraph 2, of Legislative Decree 58/1998 (the Consolidated Financial Intermediation Act) – that the accounting information in this presentation is consistent with the data in the accounting documentation, books and other accounting records.

Investor relation contacts: Investor relations contacts

Fabio Ruffini Head of Investor Relations

Tel.: +39 06 4797 9154 Mail: investorrelations@dovalue.it