QUARTERLY REPORT OF ALLEGRO.EU GROUP

for the three and nine month periods ended 30 September 2020

GENERAL INFORMATION	9

1.	Introduction	10
2.	Forward-looking statements	11
3.	Presentation of fnancial information	12
	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS	17
1.	Selected consolidated fnancial and operational highlights	18
2.	Review of Allegro.eu Group fnancial and operational performance in Q3 2020	20
3.	Comparison of the Nine Months Ended 30 September 2019 and the Nine Months Ended 30 September 2020	32
4.	Key factors that may infuence the Group's results of operations and main market trends	43
5.	Targets and expectations for the Group in FY 2020	44
6.	Shareholders of Allegro.eu	45

	FINANCIAL STATEMENTS	47
	Responsibility statement	48
	Report on Review of Interim Condensed Consolidated Financial Statements	50
	INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	53
	Interim Condensed Consolidated Statement of comprehensive income	54
	Interim Condensed Consolidated Statement of fnancial position	56
	Interim Condensed Consolidated Statement of changes in equity	59
	Interim Condensed Consolidated Statement of cash fows	60
	NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	63
1.	General information	64
2.	Basis of preparation	65
3.	Group structure	66
4.	Business combinations	68
5.	Signifcant changes in the current reporting period	70
6.	Information on material accounting estimates	74
7.	Summary of changes in signifcant accounting policies	78
	NOTES TO THE INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME	79
8.	Segment information	80
9.	Revenues from contracts with customers	86
10.	Financial income and fnancial costs	90
11.	Income tax expense	92
12.	Earnings per share	93
	NOTES TO THE INTERIM CONDENSED CONSOLIDATED STATEMENT
	OF FINANCIAL POSITION	95
13.	Trade and other receivables	96
14.	Cash and cash equivalents	97
15.	Borrowings	98
16.	Other fnancial liabilities	99
17.	Deferred tax	100
18.	Liabilities to employees	102
19.	Trade and other liabilities	103
20.	Financial assets and fnancial liabilities	104
21.	Note to the statement of changes in equity	106
22.	Related party transactions	111
23.	Events occurring after the reporting period	114

Allegro is the go-to commerce platform for Polish consumers and has delivered strong revenue growth, proftability and cash fow at scale.

As the most recognized e-commerce brand and the largest non-food retailer by GMV in Poland, Allegro.pl is also one of the world's top ten e-commerce websites and among the top 100 websites in the world by visits per month.

The Allegro.pl marketplace platform facilitates the sale of new products primarily on behalf of merchants through a business-to-customer model and attracts visits from an average of 20 million internet users per month, which is equivalent to 63% of Polish residents ages 16 and above and 76% of all internet users in Poland.

Merchants on the Group's e-commerce marketplace sell across a variety of categories covering electronics, home and garden; sports and leisure; kids; automotive; fashion and shoes; health and beauty; books, media, collectibles and art; and supermarket.

Apart of Allegro.pl the Group operates other leading Polish websites: ceneo.pl – price comparison platform and eBilet. pl – online ticket sales. The Group targets the retail market in Poland, which had an estimated size of PLN 621 billion (USD 165 billion) in 2019 is forecasted to grow to PLN 724 billion (USD 193 billion) by 2024.

B2C e-commerce leader

GMV more than 12 times higher than closest online competitor in Poland in 2019

One of the world's top ten ecommerce websites

(according to Similarweb)

Trusted E-shopping destination

Approx. 2x more users start their product search on Allegro than on Google

Highly rated internet brand

Approx. 380m monthly visits in 2020

Largest Non-food retailer

Market share approx. 2x the size of the 2nd largest non-grocery retailer

Leading pricecomparison site

600m visits in 2019 from an average of 21m monthly users

GENERAL INFORMATION

1. Introduction

This is the Report of Allegro.eu S.A. (the "Company"), a public limited liability company (société anonyme), incorporated under the laws of the Grand Duchy of Luxembourg, having its registered ofce at 1, rue Hildegard von Bingen, L – 1282 Luxembourg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and Companies Register (Registre de Commerce et des Sociétés, Luxembourg) under number B214830. This Report summarizes consolidated fnancial and operating data of Allegro.eu and its subsidiaries.

Allegro.eu is a holding company (together with all of its subsidiaries, the "Group"). The Group operates the leading online marketplace in Poland, Allegro. pl, and the leading price comparison platform in Poland, Ceneo.pl. Allegro. pl and Ceneo.pl are the Group's key operating companies and are both entities incorporated under the laws of Poland. The Group also operates eBilet.pl, which is the leading event ticket sales site in Poland.

The shares of the Company have been traded on the Warsaw Stock Exchange since 12 October 2020.

At the date of the Report, 31.39% of the outstanding shares are controlled by shareholders Cidinan S.à r.l, representing the interests of Cinven & Co-Investors, 31.39% by Permira VI Investment Platform Limited, representing the interests of Permira & Co-Investors, and 6.98% by Mepinan S.à r.l., representing the interests of Mid Europa Partners Funds. The remaining 30.24% is owned by other shareholders. The number of shares held by each investor is equal to the number of votes, as there are no privileged shares issued by the Company.

2. Forward-looking statements

This Report includes forward-looking statements, which include all statements other than statements of historical facts, including, without limitation, any statements preceded by, followed by or that include the words "targets", "guidance", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could", or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Group's control that could cause the Group's actual results, its fnancial situation and results of operations or prospects of the Group to materially difer from any of those expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Group's present and future business strategies and the environment in which it currently operates and will operate in the future. Among the important factors that could cause the Group's actual results, fnancial situation, results of operations or prospects to difer from those expressed in such forward-looking statements are those factors discussed in the "Management's Discussion and Analysis of Financial Condition and Result of Operations" section and elsewhere in this Report. These forward-looking statements speak only as of the date of this Report. The Group has no obligation and has made no undertaking to disseminate any updates of or revisions to any forward-looking statements contained in this Report, unless it is required to do so under applicable laws or the WSE Rules.

Investors should be aware that several important factors and risks may cause the actual results of the Group to difer materially from the plans, objectives, expectations, estimates, and intentions expressed in such forward-looking statements.

When relying on forward-looking statements, investors should, in particular, carefully consider the factors discussed in the "Management's Discussion and Analysis of Financial Condition and Result of Operations" and "Risk Factors" sections and elsewhere of the Company's Prospectus dated 22 September 2020, and other uncertainties and events, especially in light of the political, economic, social, and legal environment in which the Group operates.

The Group makes no representation, warranty, or prediction that the factors anticipated in such forward-looking statements will be present, and such forward-looking statements represent, in each case, only one of many possible scenarios, and should not be viewed as the most likely or typical scenario.

The Group has not published and does not intend to publish any proft estimates or forecasts.

ALLEGRO.EU S.A. GROUP QUARTERLY REPORT for the three and nine month periods ended 30 September 2020

3. Presentation of financial information

Unless otherwise stated, the fnancial information in this Report has been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union. The signifcant IFRS accounting policies applied in the fnancial information of the Group are applied consistently in the fnancial information in this Report.

HISTORICAL FINANCIAL INFORMATION

This Report includes the unaudited consolidated fnancial information of the Group as of 30 September 2020 and for the nine-month periods ended 30 September 2020 and 30 September 2019, which have been derived from the unaudited interim condensed consolidated fnancial statements of the Group as of 30 September 2020 and for the nine-month periods ended 30 September 2020 and 30 September 2019, prepared in accordance with International Accounting Standard ("IAS") 34, "Interim Financial Reporting", the standard of IFRS applicable to the preparation of interim fnancial statements (the "Interim Financial Statements", together with the Annual Financial Statements, the "Financial Statements"), and included elsewhere in this Report. PricewaterhouseCoopers, Société coopérative has reviewed the Interim Financial Statements.

ALTERNATIVE PERFORMANCE MEASURES

The Group has included certain alternative performance measures ("APMs") in this Report, including, among others, Active Buyers, GMV, GMV per Active Buyer, Adjusted EBITDA, Adjusted EBITDA/ net revenue, Adjusted EBITDA/GMV, total capital expenditure, capitalized development costs, other capital expenditure, net debt, net leverage, and working capital.

ALLIGNMENT WITH LEGAL IN DESCRIPTIONS

"Active Buyers" represents, as of the end of a period, each unique email address connected with a buyer that has made a purchase on Allegro.pl or Allegrolokalnie.pl (excluding eBilet.pl) in the preceding twelve months;

"Adjusted EBITDA" means operating proft before depreciation and amortization further adjusted to exclude transaction costs, monitoring costs, market strategy preparation costs, employee restructuring costs, regulatory proceeding costs, group restructuring costs, donations to various public beneft organizations, certain bonuses for employees, the Management Incentive Plan, and funds spent on sanitary protection of employees, and the incentive programs for employees;

"Adjusted EBITDA/GMV" means Adjusted EBITDA divided by GMV;

"Adjusted EBITDA/net revenue" means Adjusted EBITDA divided by net revenue;

"Adjusted net proft" means net proft (loss) adjusted for the same one-of items as those described for Adjusted EBITDA above, net of the tax impact, and further adjusted for any one-of fnancial expenses, such as early repayment fees and deferred amortized costs arising on refnancing arrangements, net of their tax implications;

"capitalized development costs" means the costs that are capitalized and have been incurred in relation to the production of software containing new or signifcantly improved functionalities by the technology department and incurred before the software is launched commercially or the technology is applied on a serial basis;

"GMV" means gross merchandise value, which represents the total gross value of goods and tickets sold on the platforms Allegro. pl, Allegrolokalnie.pl, and eBilet.pl (including value added taxes);

"GMV per Active Buyer" represents GMV for the twelve months preceding the end of a period (excluding eBilet's tickets sales) divided by the number of Active Buyers at the end of such period;

"net debt" means the sum of borrowings and lease liabilities minus cash and cash equivalents;

"net leverage" means net debt divided by Adjusted EBITDA for the preceding twelve months;

"other capital expenditure" means the costs related to building the relevant capacity of data centers, equipping employees with appropriate equipment (i.e., workstations), ofce equipment (e.g., ft-out and IT devices) and copyrights;

"Take Rate" represents the ratio of marketplace revenue divided by GMV after deducting the GMV generated by 1P retail sales (grossed up for VAT);

"total capital expenditure" means cash outfows in respect of property, plant, and equipment and intangible assets, and comprises capitalized development costs and other capital expenditure; and

"working capital" means the sum of the changes in inventory, trade and other receivables, trade and other liabilities and the liabilities to employees during the period.

The Group presents the APMs because the Group's management believes that they assist investors and analysts in comparing the Group's performance and liquidity across reporting periods. The Group presents GMV as a measure of the total value of goods sold over a certain period, which allows for growth to be compared over diferent periods, including weekly, monthly, quarterly, and annually. The Group considers Adjusted EBITDA to be a useful metric for evaluating the Group's performance as they facilitate comparisons of the Group's core operating results from period to period by removing the impact of, among other things, its capital structure, asset base, tax consequences and specifc non-recurring costs. The Group uses Adjusted EBITDA for the purposes of calculating Adjusted EBITDA/net revenue and Adjusted EBITDA/GMV. The Group presents total capital expenditure split between capitalized development costs and other capital expenditure in order to show the amount of expenditures, including, among other things, staf costs and costs of contractors and third party service providers, incurred in relation to the production of new or improved software before it is put to use on Allegro.pl, Ceneo.pl. eBilet. pl, and Allegro Lokalnie Platform. The Group believes this split is important for investors to understand its amortization of intangible assets. The Group presents net debt and net leverage because the Group believes these measures provide indicators of the overall strength of its balance sheet and can be used to assess, respectively, the impact of the Group's cash position and its earnings as compared to its indebtedness. The Group monitors working capital to evaluate how efcient it is at managing its cash provided by operating activities.

The APMs are not accounting measures within the scope of IFRS and may not be permitted to appear on the face of primary fnancial statements or footnotes thereto. These APMs may not be comparable to similarly titled measures of other companies. Neither the assumptions underlying the APMs have been audited in accordance with IFRS or any generally accepted accounting standards. In evaluating the APMs, investors should carefully consider the Interim Financial Statements included in this Report.

The APMs have limitations as analytical tools. For example, Adjusted EBITDA and related ratios do not refect: the Group's cash expenditures, or future requirements, for capital expenditures or contractual commitments; changes in, or cash requirements for, the Group's working capital needs; interest expense, income taxes or the cash requirements necessary to service interest or principal payments, on the Group's debt; or the impact of certain cash charges resulting from matters that the Group does not consider to be indicative of its ongoing operations.

In evaluating Adjusted EBITDA, investors are encouraged to evaluate each adjustment and the reasons the Group considers it appropriate as a method of supplemental analysis. In addition, investors should be aware that the Group may incur expenses similar to the adjustments in this presentation in the future and that certain of these items could be considered recurring in nature. The Group's presentation of Adjusted EBITDA should not be construed as an inference that the Group's future results will be unaffected by unusual or non-recurring items. Adjusted EBITDA has been included in this Report because it is a measure that the Group's management uses to assess the Group's operating performance.

The defnition of Adjusted EBITDA has been amended to refect the nature of the one-of costs occurred since the last publication of the APM.

Investors are encouraged to evaluate any adjustments to IFRS measures and the reasons the Group considers them appropriate for supplemental analysis. Because of these limitations, as well as further limitations discussed above, the APMs presented should not be considered in isolation or as a substitute for performance measures calculated in accordance with IFRS.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS

ALLEGRO.EU S.A. GROUP QUARTERLY REPORT for the three and nine month periods ended 30 September 2020

1. Selected consolidated financial and operational highlights

	YTD Q3 2020	YTD Q3 2019	Change %	Q3 2020	Q3 2019	Change %
Income Statement, PLN m (Unaudited)
Net revenue	2,698.8	1,786.7	51.1%	928.7	620.2	49.7%
EBITDA	1,073.3	944.8	13.6%	284.7	319.8	(11.0)%
Adjusted EBITDA	1,216.5	953.8	27.5%	408.5	322.4	26.7%
EBIT	728.1	618.8	17.7%	167.8	210.6	(20.3)%
Proft/(Loss) before Income tax	292.0	346.7	(15.8)%	(84.7)	100.4	(184.4)%
Net Proft/(Loss)	158.0	269.1	(41.3)%	(131.7)	73.4	(279.4)%
Adjusted Net Proft	454.1	277.3	63.8%	147.4	75.7	94.6%

	YTD Q3 2020	YTD Q3 2019	Change %	Q3 2020	Q3 2019	Change %
KPIs (Unaudited)
Active Buyers (millions)	12.6	11.1	12.9%	12.6	11.1	12.9%
GMV per Active Buyer (PLN)	2,463.8	1,915.6	28.6%	2,463.8	1,915.6	28.6%
GMV (PLN in millions)	24,259.7	15,912.9	52.5%	8,253.1	5,551.3	48.7%
Take Rate (%)	9.19%	9.32%	(1.3)%	9.40%	9.29%	1.1%

	YTD Q3 2020	YTD Q3 2019	Change %	Q3 2020	Q3 2019	Change %
Cash Flow, PLN m (Unaudited)
Net cash infow/(outfow) from operating activities	1,165.0	902.1	29.1%	497.5	290.8	71.1%
Net cash infow/(outfow) from investing activities	(170.3)	(166.9)	(2.1)%	(46.0)	(35.5)	29.6%
Net cash infow/(outfow) from fnancing activities	(673.4)	(1,321.3)	(49.0)%	(301.1)	(261.4)	15.2%
Net increase/(decrease) in cash and cash equivalents	321.3	(586.2)	(154.8)%	150.4	(6.1)	(2,547.8)%

	30.09.2020	31.12.2019	Change %
Balance Sheet, PLN m (Unaudited)
Assets	14,516.1	14,278.0	1.7%
Equity	6,806.9	6,683.6	1.8%
Net Debt	5,515.3	6,018.6	(8.4)%

ALLEGRO.EU S.A. GROUP QUARTERLY REPORT for the three and nine month periods ended 30 September 2020

2. Review of Allegro. eu Group financial and operational performance in Q3 2020

KEY PERFORMANCE INDICATORS

The following KPIs are measures used by the Group's management to monitor and manage operational risk and fnancial performance.

KPIs, (Unaudited)	YTD Q3 2020	YTD Q3 2019	Change %	Q3 2020	Q3 2019	Change %
Active Buyers (millions)	12.6	11.1	12.9%	12.6	11.1	12.9%
GMV per Active Buyer (PLN)	2,463.8	1,915.6	28.6%	2,463.8	1,915.6	28.6%
GMV (PLN in millions)	24,259.7	15,912.9	52.5%	8,253.1	5,551.3	48.7%
Take Rate (%)	9.19%	9.32%	(1.3)%	9.40%	9.29%	1.1%
Adjusted EBITDA (PLN in millions)	1,216.5	953.8	27.5%	408.5	322.4	26.7%
Adjusted EBITDA/net revenue (%)	45.1%	53.4%	(15.6)%	44.0%	52.0%	(15.4)%
Adjusted EBITDA/GMV (%)	5.01%	5.99%	(16.3)%	4.95%	5.81%	(14.8)%

GMV AND ACTIVE BUYERS

In Q3 2020 GMV reached PLN 8,253.1 million, +48.7% YoY and down by 12.5% on Q2 2020. Following the end of most lockdown restrictions related to the Covid-19 pandemic in May 2020, the Group continued to see increased demand from buyers for its marketplace services. GMV per Active Buyer on a last twelve month basis grew by 7.4% in Q3 to PLN 2,464, versus Q2, bringing the increase over the past 12 months to 28.6%. Growth in Active Buyers also remained strong post lockdown with 0.3 million added in Q3 to reach 12.6 million LTM Active Buyers at 30 September 2020 and for a total YoY increase of 12.9%. The combination of growth in Active Buyers and GMV per Active Buyer produced a 45.3% increase in LTM GMV to PLN 30,968 million (Allegro only and excluding eBilet GMV).

The YoY GMV performance for Q3 was held back by 1.8 ppts of growth due to a decrease in ticket sales at eBilet due to lockdown restrictions on events attendance that continued throughout the third quarter, similarly reducing the demand for tickets.

GMV growth in Q3 2020 was strongly supported by growth in SMART! subscriptions, with many buyers who had benefted from a free SMART! subscriptions ofered by the Group during the Q2 lockdown deciding to purchase a subscription during Q3. Buyers holding SMART! subscriptions tend to spend more than non-subscribers due to the beneft of free delivery. Nonetheless, the YoY increase in GMV per Active Buyer has been broad based, as the YoY growth was 5.5pp and 5.1pp stronger for SMART! and Non-SMART! Buyers respectively, in comparison to YoY growth as of Q1 2020.

ADJUSTED EBITDA

The Group's Adjusted EBITDA grew by 27.5% YoY for the nine months ended 30 September 2020 and by 26.7% for Q3 2020. Adjusted EBITDA growth in Q3 of 26.7% was close to the level of 28.0% recorded in the frst half of 2020 as continued high demand following the end of the Q2 Covid-19 lockdown restricted the QoQ decrease in GMV by 12.5 % or PLN 1,184 million. Stabilization of take-rates following the introduction of price changes that had been delayed during the lockdown ofset lower operating leverage on lower GMV and higher net costs of delivery from a larger base of SMART! customers to improve Adjusted EBITDA/GMV by 0.16 pp versus Q2 2020 and reach 4.95% in Q3. Almost all costs of Allegro. eu's IPO and refnancing were recognised in Q3 and were included in EBITDA adjustments.

The following table presents a reconciliation between Reported and Adjusted EBITDA for the periods under review:

Reconciliation of Adjusted EBITDA, PLN m (Unaudited)	YTD Q3 2020	YTD Q3 2019	Change %	Q3 2020	Q3 2019	Change %
EBITDA	1,073.3	944.8	13.6%	284.7	319.8	(11,0)%
Monitoring costs (1)	2.8	2.8	0.5%	1.1	1.0	8.3%
Regulatory proceeding costs (2)	2.6	1.0	174.7%	0.7	0.5	28.4%
Group restructuring costs (3)	2.8	0.6	343.7%	0.1	0.0	214.0%
Donations to various public beneft organisations (4)	4.5	—	n/a	0.8	—	n/a
Bonus for employees and funds spent on sanitary protection of employees (5)	2.9	—	n/a	0.4	—	n/a
Allegro Incentive Plan (6)	14.6	—	n/a	14.6	—	n/a
Management Incentive Plan (7)	52.2	3.2	1,513.1%	45.3	1.1	4,062.9%
Transaction costs (8)	60.8	1.4	4,348.3%	60.8	—	n/a
Adjusted EBITDA	1,216.5	953.8	27.5%	408.5	322.4	26.7%

[1] Represents expenses incurred in relation to performance of advisory services by the shareholders of the Group, including travel expenses and expenses for services provided for projects outside the scope of supervisory responsibilities.
[2] Represents legal costs mainly related to regulatory proceeding the Polish competition authority, the OCCP, conducted an inspection at Allegro's ofces in June 2017 related to antitrust proceedings against Allegro.pl concerning the alleged abuse of a dominant position by Allegro.pl on the Polish market for online B2C intermediary sales services and other proceedings.
[3] Represents legal and fnancial due diligence expenses with respect to not concluded acquisitions of target companies along with other legal expenses connected with group reorganisation.
[4] Represents donations made by the Group to support several public organizations during the COVID-19 pandemic.
[5] Represents expenses incurred by the Group to buy employees' sanitary protections and to pay employees' bonuses for the purchase of equipment necessary to enable them to work remotely during the COVID-19 pandemic.
[6] Represents the part of a one-of grant to employees of shares awarded at the Group's IPO accrued between the date of announcement and 30 September 2020. The remainder of the total cost of PLN 25.4 million was recognized between 1 October and the date of the IPO on 12 October.
[7] Cost of share based compensation related to incentive elements of The Management Incentive ("Investment Opportunities") in which management participated indirectly through investing in shares in the Adiman SCSP Trust and directly via type C and D shares issued by Allegro.eu. This Management Incentive Plan ("MIP") ceased to exist at its full settlement at the moment at the Group's IPO. The increase in share based compensation expense recognized in the third quarter of 2020 is the result of new investments in the MIP being made with the assistance of non-recourse loans.
[8] Represents costs of advisory and consultancy incurred during the process of preparation for the IPO in 2020 (PLN 60.4 million) and costs related to the acquisition of eBilet in 2019 (PLN 1.4 million) and the further acquisition of a 20% minority interest in the third quarter of 2020 (PLN 0.4 million).

ADJUSTED NET PROFIT

The Group's Adjusted Net Proft grew 65.3% yearover-year for the nine months ended 30 September 2020 and 98.2% for Q3 2020 as a result of the same factors driving Adjusted EBITDA growth discussed above. Almost all costs of Allegro. eu's IPO and refnancing were recognised in Q3.

The following table presents a reconciliation between reported and adjusted net proft for the periods under review.

PLN m, (Unaudited)	YTD Q3 2020	YTD Q3 2019	Q3 2020	Q3 2019
Net proft/(loss)	158.0	269.1	(131.7)	73.4
EBITDA adjustments	143.2	9.0	123.8	2.6
Net fnancial result adjustment, comprising of:	158.6	—	158.6	—
Early repayment fee (1)	25.9	—	25.9	—
Deferred amortised costs (2)	132.7	—	132.7	—
Tax impact of adjustments	(5.7)	(0.8)	(3.4)	(0.3)
Adjusted net proft	454.1	277.3	147.4	75.7

[1] Represents early repayment charges of the Second Lien Facility before the due date.

[2] As a result of the Board of Director's decision, taken on 28 September, to refnance its existing borrowing facilities using a new borrowing facility and proceeds of a primary share ofering pursuant to the Group's IPO, the carrying value of the existing borrowing facilities was modifed to refect an earlier expected full repayment date of 14 October 2020. As a result of this decision, the carrying value of the existing borrowing facilities at amortized cost increased by PLN 132.7 million and an equivalent amount of deferred borrowings cost was recognized as a non-cash fnancial expense.

RESULTS OF OPERATIONS

The following table presents the Group's summary consolidated statements of comprehensive income data for the nine months ended 30 September and for the Q3, 2019, and 2020.

Income Statement, PLN m (Unaudited)	YTD Q3 2020	YTD Q3 2019	Change %	Q3 2020	Q3 2019	Change %
Net revenue	2,698.8	1,786.7	51.1%	928.7	620.2	49.7%
Operating expenses	(1,625.5)	(841.8)	93.1%	(644.0)	(300.4)	114.4%
Payment charges	(110.4)	(99.1)	11.4%	(36.3)	(31.5)	15.0%
Cost of goods sold	(120.2)	(59.0)	103.7%	(37.9)	(22.4)	69.1%
Net costs of delivery	(420.3)	(171.1)	145.6%	(174.1)	(66.7)	160.8%
Marketing service expenses	(395.8)	(202.1)	95.8%	(122.5)	(75.5)	62.3%
Staf costs net	(356.9)	(212.9)	67.6%	(154.0)	(71.1)	116.6%
IT service expenses net	(42.2)	(27.5)	53.7%	(15.0)	(9.8)	52.5%
Other expenses net	(118.8)	(68.8)	72.9%	(43.4)	(23.3)	86.2%
Transaction costs	(60.8)	(1.4)	4,349.9%	(60.8)	–	n/a
Operating proft before amortisation and depreciation (EBITDA)	1,073.3	944.8	13.6%	284.7	319.8	(11.0)%
Amortisation and Depreciation	(345.2)	(326.0)	5.9%	(117.0)	(109.2)	7.1%
Amortisation	(298.1)	(284.7)	4.7%	(100.7)	(95.2)	5.8%
Depreciation	(47.1)	(41.3)	14.0%	(16.3)	(14.0)	16.3%
Operating proft	728.1	618.8	17.7%	167.8	210.6	(20.3)%
Net Financial result	(436.1)	(272.1)	60.3%	(252.4)	(110.3)	129.0%
Financial income	13.3	8.4	58.6%	0.5	1.2	(61.7)%
Financial costs	(449.4)	(280.5)	60.2%	(252.9)	(111.4)	126.9%
Proft/(Loss) before Income tax	292.0	346.7	(15.8)%	(84.7)	100.4	(184.4)%
Income tax expenses	(134.0)	(77.6)	72.8%	(47.0)	(27.0)	74.1%
Net Proft/(Loss)	158.0	269.1	(41.3)%	(131.7)	73.4	(279.4)%
Other comprehensive income/(loss)	(85.8)	5.4	(1,677.0)%	(19.9)	11.5	(272.6)%
Total comprehensive income/(loss) for the period	72.2	274.6	(73.7)%	(151.6)	84.9	(278.4)%

COMPARISON OF THE Q3 2019 AND Q3 2020

NET REVENUE

Net revenue increased by PLN 308.5 million, or 49.7%, from PLN 620.2 million for Q3 2019 to PLN 928.7 million for Q3 2020. This increase resulted primarily from increases in marketplace revenue, advertising revenue, and retail revenue.

The following table presents a breakdown of net revenue for the periods under review and related growth rates.

Income Statement, PLN m (Unaudited)	Q3 2020	Q3 2019	Change %
Marketplace revenue	771.5	513.6	50.2%
Advertising revenue	78.3	48.1	62.7%
Price comparison revenue	37.4	31.8	17.6%
Retail revenue	35.6	20.9	69.9%
Other revenue	5.8	5.7	3.3%
Net revenue	928.7	620.2	49.7%

MARKETPLACE REVENUE

Marketplace revenue increased by PLN 257.9 million, or 50.2%, from PLN 513.6 million for Q3 2019 to PLN 771.5 million for Q3 2020. This increase resulted primarily from 48.7% year-on-year GMV growth that was supported by a 10 basis point increase in the Group's Take Rate. After a lower rate in Q2, take rates stabilized due to the introduction of previously delayed pricing changes and an increased share of fxed and semi-fxed fees in total marketplace revenue. Increased Buyer Engagement sustained post Q2 Covid-19 lockdown and PPC spending maintained a high level of purchases on the Group's e-commerce marketplace throughout Q3. SMART! subscriptions and related buyer spending grew strongly during Q3 as buyers who received SMART! for free during lockdown converted to paid subscribers. As a result of these factors, the number of Active Buyers increased by 12.9% and GMV per Active Buyer increased by 28.6% compared to the twelve months ended 30 September 2019.

ADVERTISING REVENUE

Advertising revenue increased by PLN 30.2 million, or 62.7%, from PLN 48.1 million for Q3 2019 to PLN 78.3 million for Q3 2020. This increase resulted primarily from the strong performance of sponsored ofer ads due to an acceleration in trafc growth on the Group's websites as well as a higher number of merchants purchasing sponsored Ads ofers as Polish consumers shifted signifcantly to e-commerce as a result of the COVID-19. The increase was also the result of improved performance of digital advertising due to self-service scalability and higher sales to strategic clients.

PRICE COMPARISON REVENUE

Price comparison revenue increased by PLN 5.6 million, or 17.6%, from PLN 31.8 million for Q3 2019 to PLN 37.4 million for Q3 2020. This increase resulted primarily from higher revenue from cost-per-click fees, which were generated from a higher number of site visits resulting in increased clicks supported by a higher average cost per click.

RETAIL REVENUE

Retail revenue increased by PLN 14.6 million, or 69.9%, from PLN 20.9 million for Q3 2019 to PLN 35.6 million for Q3 2020. 1P retail sales represented 0.4% of total GMV in Q3 2019 and 0.5% of total GMV in Q3 2020. This increase in retail revenue resulted primarily from higher sales during the SMART! Week campaign and generally higher observed demand post Covid-19 lockdown.

OPERATING EXPENSES

Operating expenses increased by PLN 343.6 million, or 114.4%, from PLN 300.4 million for Q3 2019 to PLN 644.0 million for Q3 2020. This increase resulted primarily from increased net costs of delivery, marketing service expenses, staf costs and one of costs related to IPO and the Management Incentive Plan as explained below.

PAYMENT CHARGES

Payment charges increased by PLN 4.7 million, or 15.0%, from PLN 31.5 million for Q3 2019 to PLN 36.3 million for Q3 2020. This increase resulted from higher sales on the Group's e-commerce marketplace, substantially ofset by lower rates from third-party providers due to discounts negotiated in the second quarter of 2019 that increased after reaching agreed volume thresholds.

COST OF GOODS SOLD

Cost of goods sold increased by PLN 15.5 million, or 69.1%, from PLN 22.4 million for Q3 2019 to PLN 37.9 million for Q3 2020. This increase resulted primarily from increased sales through the Group's 1P retail business operations with margins improved slightly by 0.5 percentage points as a result of an optimized algorithm helping to address correction of price defects more cost efciently.

NET COSTS OF DELIVERY

Net costs of delivery increased by PLN 107.3 million, or 160.8%, from PLN 66.7 million for Q3 2019 to PLN 174.1 million for Q3 2020. This increase resulted primarily from an increased number of buyers on the Group's e-commerce marketplace who were members of the SMART! program, partly due to conversion of SMART! Stay at Home users to paying Smart! subscribers. Following the introduction of co-fnancing by sellers of SMART! courier deliveries and lower price per package, the Net cost of delivery per shipped package fell by 17.4% YoY in Q3 2020.

MARKETING SERVICE EXPENSES

Marketing service expenses increased by PLN 47.0 million, or 62.3%, from PLN 75.5 million for Q3 2019 to PLN 122.5 million for Q3 2020. This increase refected a 73.9% increase of pay-per-click advertising, plus higher investment in Brand marketing supporting campaigns such as "Back to School", "Bestsellers" as well as higher costs of Buyer Protection Program. The cost of free delivery incurred providing SMART! services free of charge to non-SMART! subscribers during lockdown in Q2 2020 (PLN 81.2 million), which was recognized as marketing expense, was reduced to PLN 3.3 million during Q3 as such arrangements ran down to zero by July 2020.

STAFF COSTS

Staf costs increased by PLN 82.9 million, or 116.6%, from PLN 71.1 million for Q3 2019 to PLN 154.0 million for Q3 2020. This increase resulted partly from the recruitment of new employees as headcount at 30 September 2020 was 21.1% higher than at 30 September 2019, as well as an increase in base salaries and higher annual bonus provisions due to the Group's strong performance. However, the major part of the increase refected share based compensations for managers who had invested in the Management Incentive Program that was settled at the IPO (PLN 45.3 million) and a further PLN 14.6 million related to shares granted to employees at the IPO. In total, IPO-related one-ofs included in this expense line were PLN 62.3 million.

IT SERVICE EXPENSES

IT service expenses increased by PLN 5.2 million, or 52.5%, from PLN 9.8 million for Q3 2019 to PLN 15.0 million for Q3 2020. This increase resulted primarily from new licenses related to the introduction of new software solutions and increased IT costs due to higher technical platform costs, including external cloud usage, due to the growing storage requirements for the increasing number of active ofers on the Group's e-commerce marketplace.

OTHER EXPENSES

Other expenses increased by PLN 20.1 million, or 86.2%, from PLN 23.3 million for Q3 2019 to PLN 43.4 million for Q3 2020. This increase resulted primarily from higher consultancy and contractor costs in connection with the development of new products and increased provisions for bad debts related to increased sales on the Group's e-commerce marketplace.

TRANSACTION COSTS

Transaction costs were PLN 60.8 million versus nil for Q3 2019 due to IPO-related one-of costs amounting to PLN 60.4 million and costs of acquiring the remaining 20% minority interest of eBilet Polska Sp. z o.o. of PLN 0.4 million.

OPERATING PROFIT BEFORE AMORTIZATION AND DEPRECIATION

Operating proft before amortization and depreciation decreased by PLN 35.1 million, or 11.0%, from PLN 319.8 million for Q3 2019 to PLN 284.7 million for Q3 2020 as a result of the factors described above. The decrease was driven mainly by IPO-related oneof costs which amounted to PLN 60.4 million in the period, Management Incentive Plan expenses of PLN 45.3 million, and PLN 14.6 million of share grants to employees in connection with the IPO.

AMORTIZATION

Amortization increased by PLN 5.5 million, or 5.8%, from PLN 95.2 million for Q3 2019 to PLN 100.7 million for Q3 2020. This increase resulted primarily from an increase in intangibles associated with capitalized development costs of projects that were completed and put into use in the twelve months since the end of the prior period, such as the frst phases of projects aimed at improving delivery experience, productization and international sellers.

DEPRECIATION

Depreciation increased by PLN 2.3 million, or 16.3%, from PLN 14.0 million for Q3 2019 to PLN 16.3 million for Q3 2020. This increase resulted primarily from the depreciation of computers and ofce equipment related to purchases made in the prior year and accelerated purchases of servers and workstations that were made to ensure the Group's ability to support the marketplace ecosystem during the COVID-19 pandemic.

OPERATING PROFIT

Operating proft decreased by PLN 42.9 million, or 20.3%, from PLN 210.6 million for Q3 2019 to PLN 167.8 million for Q3 2020 as a result of the factors discussed above.

NET FINANCIAL RESULT

Net fnancial result increased by PLN 142.1 million, or 129.0%, from a cost of PLN 110.3 million for Q3 2019 to a cost of PLN 252.4 million for Q3 2020. This increase resulted primarily from recognition of a non-cash charge to fnancial expenses in the amount of PLN 136.7 million due to the Group's September decision to refnance its borrowings at IPO in October 2020, representing the unamortized value of origination costs and related expenses, incurred at inception of the Group's borrowings facilities in 2017 and as a result of their upsize in 2019,

which will no longer be amortized over the full term of the original facilities. In addition, early repayment of the second lien facility triggered a liability to pay PLN 26.0 million in fees. The discounted amount of PLN 25.9 million was accrued in the third quarter of 2020. These expenses were ofset by the lower interest expenses resulting from lower margins paid due to Group's constant deleverage.

The following table presents a breakdown of the Group's fnancial income and fnancial costs for the periods indicated.

Unaudited (PLN in millions)	Q3 2020	Q3 2019	Change %
Interest from deposits	0.2	0.7	(73.3)%
Other fnancial income	0.3	0.5	(43.7)%
Financial income	0.5	1.2	(61.7)%
Deferred borrowings cost	(136.7)	—	n/a
Interest paid and payable for fnancial liabilities	(87.8)	(107.2)	(18.0)%
Second Lien voluntary repayment cost	(25.9)	—	n/a
Interest on leases	(0.7)	(0.9)	(24.3)%
Revolving facility availability fee	(0.8)	(0.8)	(3.3)%
Net exchange losses on foreign currency transactions	(0.7)	(2.4)	(72.7)%
Other fnancial costs	(0.3)	(0.2)	81.8%
Financial costs	(252.9)	(111.4)	126.9%
Net fnancial result	(252.4)	(110.3)	(129.0)%

PROFIT BEFORE INCOME TAX

Proft before income tax decreased by PLN 185.1 million, or 184.4%, from PLN 100.4 million for Q3 2019 to negative PLN 84.7 million for Q3 2020 as a result of the factors discussed above.

INCOME TAX EXPENSES

Income tax expenses increased by PLN 20.0 million, or 74.1%, from PLN 27.0 million for Q3 2019 to PLN 47.0 million for Q3 2020. This increase resulted primarily from an increase in operating proft before one-of expenses which increased the taxable base. The Group's efective tax rate was 26.9% and 55.5% for the three months ended 30 September 2019 and 2020, respectively, compared to the Polish standard corporate income tax rate of 19% for each period. The efective tax rate increased in the three months ended 30 September 2020 as a result of tax losses

incurred by some Group's Luxembourg subsidiaries for which no deferred tax asset is recognized as either those entities likely will not generate taxable income in the foreseeable future or those losses will not be utilized due to pending mergers. These irrecoverable tax losses related to interest paid on debt held, interest rate swap contracts, certain IPO related costs and certain debt refnancing costs.

The following table presents a breakdown of income tax expenses for the periods indicated.

Unaudited (PLN in millions)	Q3 2020	Q3 2019	Change %
Current income tax on profts	(64.6)	(35.9)	79.8%
(Increase)/Decrease in net deferred tax liability	17.6	8.9	96.9%
Income tax expense	(47.0)	(27.0)	74.1%

NET PROFIT

Net proft decreased by PLN 205.1 million, or 279.4%, from PLN 73.4 million for Q3 2019 to negative PLN 131.7 million for Q3 2020 as a result of the factors discussed above.

ADJUSTED NET PROFIT

Adjusted Net proft increased by PLN 71.6 million, or 94.6%, from PLN 75.7 million for Q3 2019 to PLN 147.4 million for Q3 2020 when PLN 123.8 million of EBITDA Adjustments and PLN 158.6 million of one-of fnancial expenses related to the Group's refnancing are excluded.

OTHER COMPREHENSIVE INCOME

Other comprehensive income decreased by PLN 31.4 million, or 272.6%, from PLN 11.5 million for Q3 2019 to negative PLN 19.9 million for Q3 2020. This decrease resulted primarily from adverse changes in the valuation of fnancial liabilities relating to the Group's fxed interest rate swap contracts.

TOTAL COMPREHENSIVE INCOME

Total comprehensive income decreased by PLN 236.5 million, or 278.4%, from PLN 84.9 million for Q3 2019 to negative PLN 151.6 million for Q3 2020 as a result of the factors discussed above.

ALLEGRO.EU S.A. GROUP QUARTERLY REPORT for the three and nine month periods ended 30 September 2020