Poste Italiane

Earnings Release • Aug 2, 2016

1H 2016 Results

August 2, 2016

Continuous positive performance supporting higher cash generation serving capex and dividends

1H 2016: Figures Highlights

1. Net of Intersegment revenues

2. Including other segments (PosteMobile and "Consorzio Telefonia Mobile")

Total Assets Under Management/Administration

Trust, brand and proximity as a lever of growth in well balanced clients' assets

1. Current accounts /Active Portfolio Management includes interests income, realized capital gain and income from financial assets at FVTPL (Fair Value through profit or loss)

2. 1. Transaction banking includes: payment slips, F24, money transfers, pension cheques and other revenues from current accounts. Net of intercompany values
3. 1. Payment Card Fees includes a one-off capital gain of €121 million related to the acquisition and merger of Visa Europe Ltd with the US-registered company, Visa Incorporated

Focus on Financial Services (2/3) – Revenues Breakdown

Revenue source	1H 2016 €m (var. % ) 1H 16 vs 1H 15	Rationale
Returns on Current Account Deposits	1,143 +5.6%	 Increase mainly due to higher capital gains
Fees from Postal Savings Collection	771 -4.7%	Lower fees related to lower recognized  commercial costs
Fees from Transaction Banking	520 -1.0%	Substantially stable. Lower revenues from  delegated services are partially offset by higher revenues from payments slips
Distribution Fees	166 +23.0%	 Increase mainly due to a better performance on personal loans
Payment Card Fees	230 n.m.	 Includes a one-off capital gain from VISA Europe and higher revenues from Postepay Evolution offset by lower fees from debt/prepaid cards
Total Revenues	2,830 +6.2%	Investor Relations

Focus on Financial Services (3/3) – Active Portfolio Management

BancoPosta Regulatory Framework and Capital Position

Key regulatory constraints /standards: 8% min. CET1 ratio1 / 3% min. leverage ratio

Increasing business volumes (customer deposits) and value of securities lowered leverage ratio in 1H16

ROE 2 @ 36% (vs. 31% in 1H15)

• 1. 10.5% Min. CET1 ratio required to distribute earnings
• 8 2. ROE defined as annualized net earnings/CET 1 capital (excluding valuation reserves); interim indexes may not be representative of FY results due to seasonality of earnings

Focus on Insurance & Asset Management – Group GWP and Technical Reserves Evolution

Focus on Mail & Parcels (1/2) – Volumes and Market Revenues Evolution

Labour Costs Cost of Goods Sold

Group Capital Expenditures

Capex Breakdown by Destination (%)

H1 2016: Delivering against strategy through disciplined execution

Robust results to deliver growth and dividends

Appendix

€m	1H 2015	1H 2016	Var.%
P&L
Revenue from sales and services	4,390	4,316	(1.7%)
Insurance premium revenue	9,474	10,551	11.4%
Other income from financial and insurance activities	2,055	2,781	35.3%
Other operating income	31	34	9.7%
Sales	15,950	17,682	10.9%
Personnel costs	(2,983)	(2,985)	0.1%
Other operating expenses	(1,656)	(1,611)	(2.7%)
Net change in technical provisions for insurance business and other claims expenses	(10,385)	(11,944)	15.0%
Depreciation & amortization	(289)	(299)	3.5%
EBIT	638	843	32.1%
Net interest income / (Expense)	27	15	(42.5%)
Profit before tax	665	858	29.0%
Tax	(230)	(293)	27.4%
Net income	435	565	29.9%

€m	FY 2015	1H 2016	Var.%
Balance sheet
Cash & Equivalents	3,142	1,743	(44.5%)
BancoPosta related Cash	3,161	2,556	(19.1%)
Receivables & Inventory	2,158	2,282	5.7%
Financial Assets	160,090	175,189	9.4%
Tangible and Intangible Assets	2,796	2,643	(5.5%)
Other	4,489	4,927	9.8%
Total Assets	175,836	189,340	7.7%
Trade Payables	1,453	1,293	(11.0%)
Financial liabilities	57,478	63,115	9.8%
Technical Reserves	100,314	109,397	9.1%
Other	6,933	6,877	(0.8%)
Total Liabilities	166,178	180,682	8.7%
Shareholders capital	1,306	1,306	-
Reserves	8,352	7,352	(12.0%)
Totale Equity	9,658	8,658	(10.4%)
Total Liabilities & Equity	175,836	189,340	7.7%

€m	1H 2015	1H 2016	Var.%
Cashflow statement
Net income	435	565	29.9%
Depreciation and amortization	289	299	3.5%
Net provisions for risks and charges	265	263	(0.8%)
(Use of Provisions for risks and charges)	(166)	(291)	75.3%
Net change in employee termination benefits and pension plans	(37)	(45)	21.6%
(Gains) / Losses on disposals	0	1	n.m.
Other	3	33	n.m.
FFO	789	825	4.6%
Change in working capital	(203)	(455)	n.m.
Cash flow from operations	586	370	(36.9%)
Capital expenditures	(137)	(151)	10.2%
Net change in subsidiaries and associates	(210)	0	n.m.
Disposals	2	5	n.m.
Cash flow from investments	(345)	(146)	(57.7%)
Dividend paid	(250)	(444)	77.6%
State aid restitution	535	0	n.m.
Cash Flow from financial assets and liabilities	(845)	(1,179)	39.5%
Cash flow from financing	(560)	(1,623)	n.m.
Net change in cash	(319)	(1,399)	n.m.

€m	1H 2015	FY 2015	1H 2016	Var.%
Working Capital
Trade receivables	3,371	2,346	2,300	(2.0%)
Inventories	139	134	137	2.2%
Other receivables and assets	3,453	3,200	3,592	12.3%
Current tax receivables	704	72	175	n.m.
Trade payables	(1,296)	(1,453)	(1,293)	(11.0%)
Other liabilities	(2,528)	(2,945)	(2,857)	(3.0%)
Current tax liabilities	(264)	(53)	(281)	n.m.
Working Capital	3,579	1,301	1,773	36.3%
Deferred tax asset	777	623	728	16.9%
Deferred tax liabilities	(896)	(1,177)	(912)	(22.5%)
Working Capital and deferred taxes	3,460	747	1,589	n.m.

€m	1H 2015	1H 2016	Var.%
Change in Working Capital
Trade receivables	390	46	(88.2%)
Inventories	--	(3)	n.m.
Other receivables and assets	33	(392)	n.m.
Current tax receivables	(45)	(103)	n.m.
Trade payables	(126)	(160)	27.0%
Other liabilities	(130)	(88)	(32.3%)
Current tax liabilities	240	228	(5.0%)
Deferred tax assets	(75)	(105)	40.0%
Deferred tax liabilities	(151)	(265)	75.5%
Total	136	(842)	n.m.
Financial Income on discounted receivables	11	3	(72.7%)
Net write-downs and loss on receivables	--	(18)	n.m.
Deferred tax on fair value changes and TFR actuarial income	185	402	n.m.
Cancellation of shareholder receivables CE 16/07/08 (Legge di stabilità 2015)	(535)	--	n.m.
Adjustments (non monetary items and shareholders' transactions)	(339)	387	n.m.
Change in Working Capital per cash flow statement	(203)	(455)	n.m.

€m	1H 2016	€m	1H 2016
Assets		Equity adn Liabilities
Property, plant and equipment	2,068	Totale Equity	2,700
Investment property	58
Intangible assets	408	Provisions for risks and charges	260
1 Investments	1,877	Employee termination benefits and pension plans	1,423
Financial assets	1,059	Financial liabilities	1,258
Trade receivables	4	Deffered tax liabilities	30
Deferred tax assets	444	Other liabilities	71
Other receivables and assets	149
Total Non-current assets	6,067	Total Non-current liabilities	3,042
Inventories	133	Provisions for risks and charges	700
Trade receivables	2,004	Trade payables	1,198
Current tax assets	32	Current tax liabilities	83
Other receivables and assets	313	Other liabilities	1,261
Financial assets	401	Financial liabilities	550
Cash and cash equivalents	584
Total Current assets	3,467	Total Current liabilities	3,792
Total Assets	9,534	Totale Equity and Liabilities	9,534

€m	1H 2016	€m	1H 2016
Assets		Equity adn Liabilities
Property, plant and equipment	2,068	Totale Equity	2,700
Investment property	58
Intangible assets	408	Provisions for risks and charges	260
1 Investments	1,877	Employee termination benefits and pension plans	1,423
Financial assets	1,059	Financial liabilities	1,258
Trade receivables	4	Deffered tax liabilities
Deferred tax assets	444	Other liabilities
Other receivables and assets	149
Total Non-current assets	6,067	Total Non-current liabilities	3,042
Inventories	133	Provisions for risks and charges	700
Trade receivables	2,004	Trade payables	1,198
Current tax assets	32	Current tax liabilities
Other receivables and assets	313	Other liabilities	1,261
Financial assets	401	Financial liabilities	550
Cash and cash equivalents	584
Total Current assets	3,467	Total Current liabilities	3,792
Total Assets	9,534	Totale Equity and Liabilities	9,534

€m	2 FY 2015	1H 2016	Var.%
Net Debt - Mail & Parcels and Other Services
Cash and Cash Equivalents	1,331	596	(55.2%)
Current Financial Assets	169	69	(59.2%)
Short term debt	(515)	(6)	(98.8%)
Current part of long term debt	(16)	(1)	(93.8%)
Other current financial liabilities	(20)	(20)	-
Current Financial Position	(551)	(27)	(95.1%)
Current Net Financial Position	949	638	(32.8%)
Long term debt	(400)	(400)	-
Bonds	(797)	(797)	-
Other non current financial liabilities	(57)	(64)	12.3%
Non Current Financial Position	(1,254)	(1,261)	0.6%
Net Financial Position	(305)	(623)	n.m.
Non current financial assets	553	659	19.2%
Net Financial Position - Mail & Parcel and Other Sercvices	248	36	(85.5%)
Intersegment financial receivables	674	732	8.6%
Intersegment financial payables	(615)	(492)	(20.0%)
1 Net Financial Position (net of intersegments)	307	276	(10.1%)

1. Including a Net Financial Position of Other Services (€ 40m for the first half 2016 and € 38m in 2015)

2. Poste Tributi previously included in Mail & Parcel sector has been reclassified to financial services

€m	1H 2015	1H 2016	Var.%
P&L
Total revenue	2,918	3,110	6.6%
o/w Market revenue	2 664 ,	2 830 ,	2% 6
o/w Intercompany revenue	254	280	10 2%
Personnel costs	(63)	(63)	0.4%
Other operating expenses	(2 398) ,	(2 560) ,	6.8%
EBITDA	457	487	6.5%
EBITDA margin	7% 15	7% 15
Depreciation and amortisation	(1)	(1)	n. m.
EBIT	456	485	6.4%
EBIT margin	15 6%	15 6%

€m	1H 2015	1H 2016	Var.%
P&L
Total revenue	11,230	12,854	14.5%
o/w Market revenue	11 230 ,	12 854 ,	14 5%
o/w Intercompany revenue	0	0	n.m.
Personnel costs	(15)	(19)	25.1%
Other operating expenses	(10 962) ,	(12 558) ,	14.6%
EBITDA	253	277	9.3%
EBITDA margin	2 3%	2 2%
Depreciation and amortisation	(5)	(7)	44.2%
EBIT	248	270	8.9%
margin EBIT	2% 2	1% 2

€m	1H 2015	1H 2016	Var.%
P&L
Total revenue	4,190	4,324	3.2%
o/w Market revenue	1 933 ,	1 884 ,	(2 5%)
o/w Intercompany revenue	2 257 ,	2 440 ,	8 1%
Personnel costs	(2 894) ,	(2 893) ,	n.m.
Other operating expenses	(1 120) ,	(1 083) ,	(3.3%)
EBITDA	176	348	97.4%
margin EBITDA	2% 4	0% 8
Depreciation and amortisation	(265)	(274)	3.4%
EBIT	(89)	74	n.m.
EBIT margin	-2 1%	7% 1

Other Services – Poste Mobile Key Financials

€m	1H 2015	1H 2016	Var.%
P&L
Total revenue	166	147	(11.8%)
o/w Market revenue	123	114	(7 .0%)
o/w Intercompany revenue	43	32	(25 .2%)
Personnel costs	(11)	(10)	(13.5%)
Other operating expenses	(114)	(105)	(7.7%)
EBITDA	41	32	(22.6%)
EBITDA margin	24.6%	21.6%
Depreciation and amortisation	(18)	(17)	(6.9%)
EBIT	22	15	(35.4%)
margin EBIT	13.5%	9.9%
Non-operating income/(expenses)	(0)	(0)	19.1%
Profit before taxes	22	14	(36.4%)
Taxes	(8)	(5)	(39.0%)
Profit after taxes	14	9	(34.9%)
Cash flow statement
FFO	32.3	24.6	(23.9%)
Cash flow from investments	(7.9)	(13.0)	(64.7%)
Net change in cash	(10.7)	(4.8)	55.5%
Other key data
Average number of users (sim cards -#k)	3,394	3,619	6.6%
ARPU (€)	5.3	4.8	(9.6%)

Insurance and Asset Management – Cost Structure and Profitability at Divisional Level

Insurance and Asset Management – Operating Costs (€m)

Intersegment Costs Other

Insurance and Asset Management – Operating Profit (€m)1

Segment Flow Description – 1H 2016 (€m)

1. Including external costs, and D&A

1. Including Other Services (Poste Mobile)

Disclaimer

This presentation contains certain forward-looking statements that reflect the Company's management's current views with respect to future events and financial and operational performance of the Company and its subsidiaries. These forward-looking statements are based on Poste Italiane S.p.A.'s current expectations and projections about future events. Because these forward-looking statements are subject to risks and uncertainties, actual future results or performance may differ materially from those expressed in or implied by these statements due to any number of different factors, many of which are beyond the ability of Poste Italiane S.p.A. to control or estimate precisely, including changes in the regulatory environment, future market developments, fluctuations in the price and availability of fuel and other risks. You are cautioned not to place undue reliance on the forward-looking statements contained herein, which are made only as of the date of this presentation. Poste Italiane S.p.A. does not undertake any obligation to publicly release any updates or revisions to any forward-looking statements to reflect events or circumstances after the date of this presentation. This presentation does not constitute a recommendation regarding the securities of the Company. This presentation does not contain an offer to sell or a solicitation of any offer to buy any securities issued by Poste Italiane S.p.A. or any of its subsidiaries. Pursuant to art. 154-BIS, par. 2, of the Unified Financial Act of February 24, 1998, the executive in charge of preparing the corporate accounting documents at Poste Italiane S.p.A., Luciano Loiodice, declares that the accounting information contained herein corresponds to document results, books and accounting records.