DEA Capital — Interim / Quarterly Report 2020

Nov 13, 2020

INTERIM MANAGEMENT REPORT AS AT 30 SEPTEMBER 2020 ______________________

3rd Quarter 2020 First Nine Months of 2020

Board of Directors Milan, 10 November 2020

Interim Management Report as at 30 September 2020 1

DeA Capital S.p.A.

Corporate information DeA Capital S.p.A. is subject to the management and coordination of De Agostini S.p.A. Registered office: Via Brera 21, Milan 20121, Italy Share capital: EUR 266,612,100 (fully paid up), comprising 266,612,100 shares with a nominal value of EUR 1 each (including 5,555,785 treasury shares as at 30 September 2020) Tax Code and Registration in the Milan Companies Register No. 07918170015. Member of the "B & D Holding VAT Group", VAT No. 02611940038, Milan REA 1833926

Board of Directors (*)

Chairman	Lorenzo Pellicioli
Chief Executive Officer	Paolo Ceretti
Directors	Marco Boroli Donatella Busso (2/5) Nicola Drago Carlo Enrico Ferrari Ardicini Dario Frigerio Francesca Golfetto (3/5) Davide Mereghetti (3/5) Daniela Toscani (1/5) Elena Vasco (1/4/5)

Board of Statutory Auditors (*)

Chairman	Cesare Andrea Grifoni
Permanent Auditors	Annalisa Raffaella Donesana Fabio Facchini
Deputy Auditors	Andrea Augusto Bonafè Michele Maranò Marco Sguazzini Viscontini
Manager responsible for preparing the Company's accounts and Chief Operating Officer	Manolo Santilli
Independent Auditors	PricewaterhouseCoopers S.p.A.
	(*) In office until the approval of the Financial Statements as at 31 December 2021

(1) Member of the Control and Risks Committee (2) Member and Chairman of the Control and Risks Committee (3) Member of the Remuneration and Appointments Committee (4) Member and Chairman of the Remuneration and Appointments Committee (5) Independent Director

Interim Management Report as at 30 September 2020 2

Contents

Interim Management Report

• 1. Profile of DeA Capital S.p.A.
• 1. Key Financials
• 1. Information for shareholders
• 1. Significant events in the third quarter of 2020
• 1. Results of the DeA Capital Group
• 1. Other information

Consolidated Financial Statements and Notes to the Financial Statements for the period from 1 January to 30 September 2020

Certification of the Interim Management Report as at 30 September 2020

Interim Management Report

1. Profile of DeA Capital S.p.A.

DeA Capital S.p.A., with the companies that are part of the Group, is the leading independent Platform for Alternative Asset Management in Italy, with Combined AUM of about EUR 23 billion and a wide range of products and services for institutional investors.

The Platform – concentrated on the two subsidiaries, DeA Capital Real Estate SGR and DeA Capital Alternative Funds SGR, as well as on the indirect equity investment in Quaestio Capital Management SGR – is engaged in the promotion, management and development of real estate, credit and private equity investment funds, as well as multi-asset/multi-manager investment solutions.

To support the Platform's activities, over time DeA Capital S.p.A. has also built up a portfolio of Alternative Investments which mainly comprises funds managed by the asset management companies of the Platform itself.

The Company's ability to carry out investment initiatives that are structurally very complex, on the one hand, and raise funds through its asset management companies, on the other, is proof of the effectiveness of its business model, which combines Alternative Asset Management with that of investment to create value in a unique way in Italy's alternative investment sector.

DeA Capital S.p.A. is listed on the FTSE Italia STAR section of the Milan stock exchange and heads the De Agostini Group in the area of Alternative Asset Management.

As at 30 September 2020, the corporate structure of the Group headed by DeA Capital S.p.A. (the DeA Capital Group or the Group) was summarised below:

2. Key Financials

(*) Combined AUM (Asset under Management) and Combined Revenues mean, respectively, the assets under management and the revenues of the asset management companies in which the Group holds an absolute/relative majority (non-consolidated) interest, as well as the corresponding amounts recorded by international subsidiaries. The amounts relating to the included non-consolidated companies, for the first 9 months of 2020, amounted to EUR 7,748 million of Combined AUM and EUR 19.4 million of Combined Revenues.

Managerial Income Statement

€M	9M 2020	9M 2019	Change
Net Operating Result AAM (*)	13.0	11.2	1.8
Other AAM	(2.4)	(1.7)	(0.7)
Net Result AAM	10.6	9.5	1.1
Alternative Investment	(8.7)	2.4	(11.1)
Holding Cost	(7.0)	(6.0)	(1.0)
Tax	3.7	0.6	3.1
Net Group Result	(1.4)	6.5	(7.9)

(*) Includes the Net Result Before PPA / non-recurring items of the three Asset Management Companies of the Platform: DeA Capital RE SGR, DeA Capital AF SGR and Quaestio SGR (@ 38.82%, incl. Quaestio Holding)

Managerial Statement of Financial Position

	30 September 2020		31 December 2019 "adjusted"
	M€	€/Sh.	M€	€/Sh.
Alternative Asset Management
- DeA Capital Real Estate SGR	130.8	0.50	141.2	0.54
- DeA Capital Alternative Funds SGR	59.2	0.23	55.6	0.21
- Quaestio Capital SGR (including Quaestio Holding)	13.9	0.05	14.3	0.06
- Other (YARD, DeA Capital RE France, Iberia, Poland)	7.6	0.03	6.6	0.03
Total AAM (A)	211.5	0.81	217.7	0.84
Alternative Investment
- AI Platform Investments	101.8	0.39	118.0	0.45
- AI Other Investments	24.2	0.09	51.4	0.20
Total AI (B)	126.0	0.48	169.4	0.65
Investment Portfolio (A+B)	337.5	1.29	387.1	1.49
Other net assets (liabilities)	6.8	0.03	4.6	0.02
Net Financial Position Holdings	81.7	0.31	34.5	0.13
NAV	426.0	1.63	426.2	1.64

3. Information for shareholders

Share performance

0.70 0.80 0.90 1.00 1.10 1.20 1.30 1.40 1.50 1.60

- From 1 January 2020 to 30 September 2020

- From 1 October 2014(*) to 30 September 2020 – Total Shareholder Return

(*) Performance from 1 October 2014 (closing date for the exit from the investment in Générale de Santé) as at 30 September 2020

Interim Management Report as at 30 September 2020 9

Performance of the DeA Capital share

With reference to performance in 2020, DeA Capital's share price fell by -13.4%. In the same period, the FTSE All-Share® TR and LPX Composite® TR recorded performances of -16.9% and -15.1% respectively.

From 1 October 2014, (the closing date for the sale of the investment in GDS) to 30 September 2020, the overall performance (including extraordinary dividends) of DeA Capital shares was up +42.1%, while the Italian FTSE All-Share® TR index +15.5% and the LPX Composite® TR index +63.9% (source Bloomberg).

With regard to the share's liquidity, average daily trading volumes in the first nine months of 2020 stood at around 200,000 shares, up from the daily average of 2019.

DeA Capital's share prices recorded in 2020 are listed below:

	1 January/30 September
in EUR	2020
Maximum price	1.38
Minimum price	0.89
Average price	1.21
Price as at 30 September 2020 (EUR per share)	1.16
Market capitalisation as at 30 September 2020 (EUR million)	303

Shareholder structure of DeA Capital S.p.A. (#)

(#) Data as at 30 September 2020

4. Significant events in the third quarter of 2020

The following is a discussion of the significant events that occurred in the third quarter of 2020. For a discussion of events in the first half of 2020, please refer to the Half-Yearly Financial Report at and for the period ended 30 June 2020, approved by the Board of Directors on 8 September 2020.

Development of the Alternative Asset Management Platform

Despite the complex framework of reference induced by the spread of COVID-19, the Group continued the development activities of the Alternative Asset Management Platform in the third quarter of 2020.

In particular, in the Real Estate segment, the Platform completed the launch of new funds for assets under management of over EUR 200 million in Italy and a new project in the Iberian market at European level.

With regard to Credit, the VII and VIII closing of the CCR II fund were finalised between the end of the 3rd quarter and the beginning of the 4th (for a total of EUR 40 million), which brought the overall amount of the fund to approximately EUR 615 million.

In the context of Private Equity, the Platform has:

• - launched new funds for total funding of EUR 400 million (of which EUR 330 million relating to Taste of Italy 2). In support of these initiatives, DeA Capital S.p.A. has entered into a commitment of up to approximately EUR 25 million;
• - finalized (on 1st October 2020) a new closing of EUR 20 million for the multi-manager DeA Endowment Fund, dedicated to Foundations.

A further step in the internationalisation process of the Alternative Asset Management Platform

During August 2020, to further boost the internationalisation process of the Alternative Asset Management Platform in the Real Estate area, the agreements were finalised for the establishment, completed in October 2020, of DeA Capital Real Estate Germany, a company under German law 70% owned by the DeA Capital Group, with the remaining stake held by a local key manager. Similar to the other European subsidiaries – already operating in France, Spain / Portugal and Poland – the company's goal is to develop the real estate advisory business for raising funds and real estate advisory and management activities, with a special focus on the core plus, value-added and opportunistic sub-sectors, in Germany, Austria and Switzerland.

Funds managed by the Alternative Asset Management Platform - Deposits / Distributions

During the 3rd quarter of 2020, the DeA Capital Group increased the respective investments in the payments made for a total of EUR 2.1 million relating to the funds IDeA I FoF, ICF II, ICF III, IDeA EESS, IDeA ToI, IDeA ToI II, IDeA CCR I, IDeA CCR II, IDeA Agro and Santa Palomba, and therefore up to a total of EUR 5.8 million in the first nine months of 2020.

At the same time, in the 3rd quarter of 2020, the DeA Capital Group received capital reimbursements (excluding withholding tax) totalling EUR 3.4 million (from the IDeA I FoF, ICF II, IDeA OF I, IDeA EESS and Venere), for a total of EUR 10.4 million in the first nine months of 2020.

Thus, in the 3rd quarter of 2020, the funds in which DeA Capital S.p.A. has invested resulted in a net positive cash balance of EUR 1.3 million for the portion relating to the Group.

Distribution by IDeaMI

During the 3rd quarter of 2020, DeA Capital SpA collected EUR 5.7 million from the balance of the liquidation assets for ordinary shareholders, and the residual pertaining to the special shares of IDeaMI (SPAC), for a total liquidation proceeds of EUR 22.2 million.

5. Results of the DeA Capital Group

Alternative Asset Management Platform - AUM (M€)

Alternative Asset Management Platform - Revenues (M€)

Details for Investment Solution (M€)

Consolidated Income Statement

The Group's net profit in the first nine months of 2020 was EUR -1.4 million, compared with EUR 6.5 million in the same period of 2019.

Revenues and other income as at 30 September 2020 break down as follows:

• - Fees of EUR 51.5 million for the Alternative Asset Management business (EUR 48.0 million in the same period of 2019);
• - Income from investments valued at equity, negative for EUR -0.6 million (EUR -0.2 million for the corresponding period in 2019);
• - Other investment income and charges totalling EUR -11.7 million, mainly due to the reduction in the fair value of assets in the portfolio (EUR +3.5 million in the corresponding period of 2019).

Operating costs totalled EUR 46.3 million (of which EUR 38.3 million related to Alternative Asset Management), compared with EUR 40.8 million in the same period of 2019.

Financial income and expense stood at a total of EUR -2.3 million as at 30 September 2020, relating mainly to the OF I Fund (EUR -0.2 million in the same period in 2019).

The total tax impact for the first nine months of 2020, totalling EUR +1.1 million (EUR -4.9 million in the corresponding period of 2019), is the result of taxes of EUR -2.6 million due in respect of Alternative Asset Management activities (EUR -5.5 million due in the same period of 2019) and EUR +3.7 million relating to holding company activities (EUR +0.6 million in the corresponding period of 2019).

The Group's net result of EUR -1.4 million breaks down as follows: EUR +10.6 million attributable to Alternative Asset Management, EUR -8.7 million to Alternative Investment and EUR -3.3 million to holding companies/eliminations.

Summary Consolidated Income Statement

(EUR thousand)	Third quarter of 2020	First nine months of 2020	Third quarter of 2019	First nine months of 2019
Alternative Asset management fees	18,893	51,421	16,185	47,708
Income (loss) from equity investments	134	(572)	(113)	(246)
Other investment income/expense	(2,789)	(11,692)	9,368	3,527
Income from services	24	70	101	298
Other income	17	390	2	32
Other expenses (* )	(15,629)	(46,328)	(14,068)	(40,757)
Financial income and expenses	(27)	(2,310)	92	(226)
PROFIT/(LOSS) BEFORE TAX	623	(9,021)	11,567	10,336
Income tax	(1,872)	1,109	(2,005)	(4,889)
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS	(1,249)	(7,912)	9,562	5,447
Profit (Loss) from discontinued operations/held-for-sale assets	0	0	0	0
PROFIT/(LOSS) FOR THE PERIOD	(1,249)	(7,912)	9,562	5,447
- Group share	342	(1,441)	10,358	6,454
- Non controlling interests	(1,591)	(6,471)	(796)	(1,007)
Earnings per share, basic (€)		(0.006)		0.025
Earnings per share, diluted (€)		(0.006)		0.025

(*) Includes items "personnel costs", "service costs", "depreciation, amortization and impairment" and "other expenses"

Performance by business segment in the first nine months of 2020

	Alternative	Alternative Asset	Holdings/
(EUR thousand)	Investment	Management	Eliminations	Consolidated
Alternative Asset Management fees	0	51,533	(112)	51,421
Income (loss) from investments valued at equity	(165)	(407)	0	(572)
Other investment income/expense	(11,318)	(373)	(1)	(11,692)
Other revenues and income	0	194	266	460
Other expenses and charges	(798)	(38,259)	(7,271)	(46,328)
Financial income and expenses	(2,194)	(217)	101	(2,310)
PROFIT/(LOSS) BEFORE TAXES	(14,475)	12,471	(7,017)	(9,021)
Income tax	0	(2,558)	3,667	1,109
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS	(14,475)	9,913	(3,350)	(7,912)
Profit (Loss) from discontinued operations/held-for-sale assets	0	0	0	0
PROFIT/(LOSS) FOR THE PERIOD	(14,475)	9,913	(3,350)	(7,912)
- Group share	(8,655)	10,564	(3,350)	(1,441)
- Non controlling interests	(5,820)	(651)	0	(6,471)

Performance by business segment in the first nine months of 2019

		Alternative
(EUR thousand)	Alternative Investment	Asset Management	Holdings/ Eliminations	Consolidated
Alternative Asset Management fees	0	47,967	(259)	47,708
Income (loss) from investments valued at equity	(112)	(134)	0	(246)
Other investment income/expense	2,023	1,504	0	3,527
Other revenues and income	0	35	295	330
Other expenses and charges	(318)	(34,724)	(5,715)	(40,757)
Financial income and expenses	306	(175)	(357)	(226)
PROFIT/(LOSS) BEFORE TAXES	1,899	14,473	(6,036)	10,336
Income tax	0	(5,463)	574	(4,889)
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS	1,899	9,010	(5,462)	5,447
Profit (Loss) from discontinued operations/held-for-sale assets	0	0	0	0
PROFIT/(LOSS) FOR THE PERIOD	1,899	9,010	(5,462)	5,447
- Group share	2,388	9,528	(5,462)	6,454
- Non controlling interests	(489)	(518)	0	(1,007)

Comprehensive Income – Statement of Performance – IAS 1

Comprehensive Income or the Statement of Performance (IAS 1), in which performance for the period attributable to the Group is reported including results posted directly to shareholders' equity, reflects a negative balance of approximately EUR -1.6 million, which refers essentially to the net loss at Income Statement level.

	First nine months of 2020	First nine months of 2019
(EUR thousand)
Profit/(loss) for the period (A)	(7,912)	5,447
Comprehensive income/expense which might be subsequently reclassified to the
profit (loss) for the period	6	601
Comprehensive income/expense which will not be subsequently reclassified
within the profit (loss) for the period	(191)	(60)
Other comprehensive income, net of tax (B)	(185)	541
Total comprehensive income for the period (A)+(B)	(8,097)	5,988
Total comprehensive income attributable to:
- Group Share	(1,626)	6,995
- Non Controlling Interests	(6,471)	(1,007)

Consolidated Statement of Financial Position

(EUR thousand)	30.9.2020	31.12.2019
ASSETS
Non-current assets
Intangible and tangible assets
Goodwill	99,936	104,647
Intangible assets	26,002	42,912
Property, plant and equipment	12,355	14,297
- Building in Leasing	11,702	13,420
- Other leased assets	174	318
- Other property, plant and equipment	479	559
Total intangible and tangible assets	138,293	161,856
Investments Investments at equity and joint ventures	26,588	30,802
Investments held by Funds at Fair Value through P&L	14,658	22,773
Other Investments at Fair Value through P&L	28,874	50,382
Funds at Fair Value through P&L	126,274	143,597
Other financial assets at Fair Value through P&L	37	37
Total financial Investments	196,431	247,591
Other non-current assets
Deferred tax assets	3,928	2,409
Loans and receivables	4,844	2,485
Financial receivables for leasing - non current portion	1,130	1,313
Other non-current assets	1,293	4,990
Total other non-current assets	11,195	11,197
Total non-current assets	345,919	420,644
Current assets
Trade receivables	11,341	8,653
Financial assets at Fair Value	14,194	14,192
Financial receivables	0	245
Financial receivables for leasing - current portion	250	0
Tax receivables from parent companies	4,041	3,953
Other tax receivables	31,543	37,176
Other receivables	3,818	8,207
Cash and cash equivalents Total current assets	117,969 183,156	99,511 171,937
Total current assets	183,156	171,937
TOTAL ASSETS	529,075	592,581
SHAREHOLDERS' EQUITY AND LIABILITIES
SHAREHOLDERS' EQUITY
Net equity Group	426,033	457,464
Minority interests	16,635	23,634
Shareholders' equity	442,668	481,098
LIABILITIES
Non-current liabilities
Trade payables	800	800
Deferred tax liabilities	5,821	5,993
End-of-service payment fund	6,151	5,582
Payables to staff and social security organisations	1,106	631
Financial liabilities	14,012	13,457
- Financial liabilites for leasing	10,801	12,437
- Other financial liabilities	3,211	1,020
Total non-current liabilities	27,890	26,463
Current liabilities
Trade payables	5,237	5,470
End-of-service payment fund Payables to staff and social security organisations	33 9,074	21 11,836
Current tax	4,946	4,336
Other tax payables	667	1,491
Other payables	35,468	42,299
Short term financial payables	3,092	19,567
- Short term financial payables for leasing	3,082	3,045
- Other Short term financial payables	10	16,522
Total current liabilities	58,517	85,020
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES	529,075	592,581

Interim Management Report as at 30 September 2020 18 As at 30 September 2020, DeA Capital S.p.A. reported Group consolidated shareholders' equity of EUR 426.0 million, corresponding to a net asset value (NAV) of EUR 1.63 per share (compared with EUR 1.64 per share at the end of 2019, adjusted due to the distribution of an extraordinary dividend of EUR 0.12 per share in June 2020).

The table below shows the change in the Group's NAV in the first nine months of 2020:

Change in Group NAV	Total value (EUR m)	No. shares (millions)	Value per share (EUR)
Group NAV at 31.12.2019	457.5	260.0	1.76
Extraordinary dividend distributed	(31.3)		(0.12)
Group NAV at 31.12.2019 "adjusted"	426.2	260.0	1.64
Treasury shares delivered under acquisition minorities	(0.1)	(0.1)	1.15 (§)
Treasury shares delivered under incentive plans	0.0	1.2	1.14 (*)
Comprehensive income - Statement of Performance - IAS 1	(1.6)
Other changes in NAV	1.5
Group NAV at 30.9.2020	426.0	261.1	1.63

(§) Average price of purchases

(*) Market price at the delivery date of the shares

Consolidated net financial position

As at 30 September 2020, the consolidated net financial position was EUR 118.6 million, as shown in the table below.

Net financial position		(§)	Change
(EUR million)	30.9.2020	31.12.2019
Cash and cash equivalents	118.0	68.2	49.8
Financial assets at Fair Value through OCI	14.2	14.2	0.0
Financial receivables	3.5	25.0	(21.5)
Non-current financial liabilities	(14.0)	(13.5)	(0.5)
Current financial liabilities	(3.1)	(19.6)	16.5
TOTAL	118.6	74.3	44.3

(*) Data at 31.12.2019 restated for dividends distributed in june 2020 (31.3 € million)

The positive change in the consolidated Net Financial Position recorded in the first nine months of 2020 compared to the adjusted figure as at 31 December 2019 was mainly generated by the changes in the Investment Portfolio (of which approximately EUR 22 million relating to the distribution of the liquidation assets of IDeaMI)).

The Company believes that the cash and cash equivalents and the other financial resources available are sufficient to meet the requirement relating to payment commitments already subscribed to in funds, also taking into account the amounts expected to be called up/distributed by these funds. With regard to these residual commitments, the Company believes that the resources currently available, as well as those that will be generated by its operating activities, will enable the Group to meet the financing required for its investment activity and to manage working capital.

6. Other information

Spread of COVID-19

As regards the spread of COVID-19, during the first nine months of 2020, the DeA Capital Group continued to show strong resilience of its business and related economic results.

At the level of the Alternative Asset Management Platform, the restrictive measures on the mobility of persons made necessary by COVID-19 led to a general slowdown in entry and exit transactions for funds under management. Despite this, the operating results for the first nine months of 2020 were positive and up compared with the same period of the previous year.

At the Alternative Investment level, the spread of COVID-19 has certainly influenced the performance of the Platform Investments (investments in support of the Platform, more specifically those related to some of the funds it manages), which have shown, in terms of Group net result, a fair value reduction of EUR -12.1 million in the first 9 months of 2020, only partially offset by the revaluation recorded in the equity investment held in Kenan Investments / Migros (EUR +3.4 million in the period).

In summary, the management results recorded in the first nine months of 2020, combined with the confirmation of the Alternative Asset Management Platform's development capabilities, suggest that the assumptions regarding the resilience of the economic performance at the Group level remain intact for the remainder of the year.

Moreover, having uninterruptedly maintained business continuity, with the timely and general adoption of a smart-working policy, and through the implementation of a protocol regulating the battle against and the containment of the spread of the virus in the workplace, the Group has been able to oversee the governance of its activities during this period of extraordinary uncertainty with a capacity to respond that is substantially unchanged as compared with business-as-usual, all without significant costs / investments in terms of general and administrative expenses / capex.

Transactions with parent companies, subsidiaries and related parties

As regards transactions with related parties, these are reported in the section "Other Information" of the Notes to the Interim Management Report as at 30 September 2020.

Other information

As at 30 September 2020, the Group had 230 employees (212 at the end of 2019), including 207 in alternative asset management and 23 in alternative investment/holding companies.

With regard to the regulatory requirements set out in Article 36 of the Market Regulation on conditions for the listing of parent companies, companies formed or regulated by laws of non-EU countries and of major importance in the consolidated financial statements, it is hereby noted that no Group company falls within the above-mentioned provision.

Furthermore, conditions prohibiting listing pursuant to Article 37 of the Market Regulation, relating to companies subject to the management and coordination of other parties, do not apply.

Consolidated Financial Statements and Notes to the Financial Statements for the period 1 January - 30 September 2020

Consolidated Statement of Financial Position

(EUR thousand)	Note	30.9.2020	31.12.2019
ASSETS
Non-current assets
Intangible and tangible assets
Goodwill		99,936	104,647
Intangible assets		26,002	42,912
Property, plant and equipment		12,355	14,297
- Building in Leasing	0	11,702	13,420
- Other leased assets	0	174	318
- Other property, plant and equipment	0	479	559
Total intangible and tangible assets	1	138,293	161,856
Investments
Investments at equity and joint ventures	2a	26,588	30,802
Investments held by Funds at Fair Value through P&L Other Investments at Fair Value through P&L	2b 2c	14,658 28,874	22,773 50,382
Funds at Fair Value through P&L	2d	126,274	143,597
Other financial assets at Fair Value through P&L		37	37
Total financial Investments		196,431	247,591
Other non-current assets
Deferred tax assets	3a	3,928	2,409
Loans and receivables	3b	4,844	2,485
Financial receivables for leasing - non current portion	3c	1,130	1,313
Other non-current assets	3d	1,293	4,990
Total other non-current assets		11,195	11,197
Total non-current assets		345,919	420,644
Current assets
Trade receivables		11,341	8,653
Financial assets at Fair Value		14,194	14,192
Financial receivables		0	245
Financial receivables for leasing - current portion		250	0
Tax receivables from parent companies		4,041	3,953
Other tax receivables		31,543	37,176
Other receivables		3,818	8,207
Cash and cash equivalents Total current assets		117,969 183,156	99,511 171,937
Total current assets	4	183,156	171,937
TOTAL ASSETS		529,075	592,581
SHAREHOLDERS' EQUITY AND LIABILITIES
SHAREHOLDERS' EQUITY
Net equity Group	0	426,033	457,464
Minority interests	0	16,635	23,634
Shareholders' equity	5	442,668	481,098
LIABILITIES
Non-current liabilities
Trade payables	6a	800	800
Deferred tax liabilities	3a/6b	5,821	5,993
End-of-service payment fund	6c	6,151	5,582
Payables to staff and social security organisations		1,106	631
Financial liabilities	6d	14,012	13,457
- Financial liabilites for leasing	0	10,801	12,437
- Other financial liabilities	0	3,211	1,020
Total non-current liabilities Current liabilities		27,890	26,463
Trade payables		5,237	5,470
End-of-service payment fund		33	21
Payables to staff and social security organisations		9,074	11,836
Current tax		4,946	4,336
Other tax payables		667	1,491
Other payables		35,468	42,299
Short term financial payables		3,092	19,567
- Short term financial payables for leasing	0	3,082	3,045
- Other Short term financial payables	0	10	16,522
Total current liabilities	7	58,517	85,020
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES		529,075	592,581

Pursuant to Consob Resolution 15519 of 27 July 2006, the impact of dealings with related parties on the Statement of Financial Position, Income Statement and Cash Flow Statement is explained in the Notes to the Financial Statements.

Interim Management Report as at 30 September 2020 22

Consolidated Income Statement

(EUR thousand)	Note	Third quarter of 2020	First nine months of 2020	Third quarter of 2019	First nine months of 2019
Alternative Asset management fees	8	18,893	51,421	16,185	47,708
Income from equity investments	9	134	(572)	(113)	(246)
Other investment income/expense	10	(2,789)	(11,692)	9,368	3,527
Income from services		24	70	101	298
Other income		17	390	2	32
Personnel costs	11a	(10,178)	(29,312)	(7,973)	(23,538)
Service costs	11b	(2,791)	(10,114)	(3,874)	(10,961)
Depreciation, amortization and impairment	11c	(1,231)	(3,815)	(1,229)	(3,621)
Other expenses	11d	(1,429)	(3,087)	(992)	(2,637)
Financial income	12	74	340	265	780
Financial expenses	12	(101)	(2,650)	(173)	(1,006)
PROFIT/(LOSS) BEFORE TAX		623	(9,021)	11,567	10,336
Income tax	13	(1,872)	1,109	(2,005)	(4,889)
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS		(1,249)	(7,912)	9,562	5,447
Profit (Loss) from discontinued operations/held-for-sale assets		0	0	0	0
PROFIT/(LOSS) FOR THE PERIOD		(1,249)	(7,912)	9,562	5,447
- Group share		342	(1,441)	10,358	6,454
- Non controlling interests		(1,591)	(6,471)	(796)	(1,007)
Earnings per share, basic (€)			(0.006)	(0.006)	0.025
Earnings per share, diluted (€)			(0.006)	(0.006)	0.025

Pursuant to Consob Resolution 15519 of 27 July 2006, the impact of dealings with related parties on the Statement of Financial Position, Income Statement and Cash Flow Statement is explained in the Notes to the Financial Statements.

Performance by business segment in the first nine months of 2020

	Alternative	Alternative Asset	Holdings/
(EUR thousand)	Investment	Management	Eliminations	Consolidated
Alternative Asset Management fees	0	51,533	(112)	51,421
Income (loss) from investments valued at equity	(165)	(407)	0	(572)
Other investment income/expense	(11,318)	(373)	(1)	(11,692)
Other revenues and income	0	194	266	460
Other expenses and charges	(798)	(38,259)	(7,271)	(46,328)
Financial income and expenses	(2,194)	(217)	101	(2,310)
PROFIT/(LOSS) BEFORE TAXES	(14,475)	12,471	(7,017)	(9,021)
Income tax	0	(2,558)	3,667	1,109
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS	(14,475)	9,913	(3,350)	(7,912)
Profit (Loss) from discontinued operations/held-for-sale assets	0	0	0	0
PROFIT/(LOSS) FOR THE PERIOD	(14,475)	9,913	(3,350)	(7,912)
- Group share	(8,655)	10,564	(3,350)	(1,441)
- Non controlling interests	(5,820)	(651)	0	(6,471)

Performance by business segment in the first nine months of 2019

	Alternative	Alternative Asset	Holdings/
(EUR thousand)	Investment	Management	Eliminations	Consolidated
Alternative Asset Management fees	0	47,967	(259)	47,708
Income (loss) from investments valued at equity	(112)	(134)	0	(246)
Other investment income/expense	2,023	1,504	0	3,527
Other revenues and income	0	35	295	330
Other expenses and charges	(318)	(34,724)	(5,715)	(40,757)
Financial income and expenses	306	(175)	(357)	(226)
PROFIT/(LOSS) BEFORE TAXES	1,899	14,473	(6,036)	10,336
Income tax	0	(5,463)	574	(4,889)
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS	1,899	9,010	(5,462)	5,447
Profit (Loss) from discontinued operations/held-for-sale assets	0	0	0	0
PROFIT/(LOSS) FOR THE PERIOD	1,899	9,010	(5,462)	5,447
- Group share	2,388	9,528	(5,462)	6,454
- Non controlling interests	(489)	(518)	0	(1,007)

Consolidated Statement of Comprehensive Income (Statement of Performance – IAS 1)

(Euro thousands)	First nine months of 2020	First nine months of 2019
Profit/(loss) for the period (A)	(7,912)	5,447
Comprehensive income/expense which might be subsequently reclassified within
the profit (loss) for the period	6	601
Incomes (Losses) on financial assets at fair value	6	601
Comprehensive income/expense which will not be subsequently reclassified to
the profit (loss) for the period	(191)	(60)
Gains/(losses) on remeasurement of defined benefit plans	(191)	(60)
Other comprehensive income, net of tax (B)	(185)	541
Total comprehensive income for the period (A)+(B)	(8,097)	5,988
Total comprehensive income attributable to:
- Group Share	(1,626)	6,995
- Non Controlling Interests	(6,471)	(1,007)

Consolidated Cash Flow Statement – Direct Method

(EUR thousand)	First nine months of 2020	First nine months of 2019
CASH FLOW from operating activities
Investments in funds and shareholdings	(5,306)	(14,199)
Capital reimbursements from funds	19,209	19,548
Sale of investments	25,088	1,000
Interest received	3,918	94
Cash distribution from investments	310	1,970
Realized gains (losses) on exchange rate and derivatives	(2)	1
Taxes paid / reimbursed	(2,328)	(6,139)
Dividends received	0	135
Management and performance fees received	48,525	50,458
Revenues for services	310	1,263
Operating expenses	(39,833)	(34,501)
Net cash flow from operating activities	49,891	19,630
CASH FLOW from investing activities
Acquisition of tangible fixed assets	(129)	(373)
Purchase of licenses and intangible assets	(16,998)	(420)
Proceeds from the sale of tangible and intangible fixed assets	22,317	0
Net cash flow from investing activities	5,190	(793)
CASH FLOW from financing activities
Acquisition of financial assets	(10)	(7,657)
Sale of financial assets	0	516
Cash flow from leasing contract	(1,962)	(2,232)
Share capital issued	0	100
Own shares acquired	(120)	0
Share capital issued for Stock Option Plan	0	324
Dividends/reimbursements paid	(32,531)	(37,531)
Loans and bank loans	(2,000)	(1,528)
Net cash flow from financing activities	(36,623)	(48,008)
CHANGE IN CASH AND CASH EQUIVALENTS	18,458	(29,171)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	99,511	143,766
Effect of change in basis of consolidation: cash and cash equivalents	0	0
CASH AND CASH EQUIVALENTS AT END OF PERIOD	117,969	114,595

Pursuant to Consob Resolution 15519 of 27 July 2006, the impact of dealings with related parties on the Statement of Financial Position, Income Statement and Cash Flow Statement is explained in the Notes to the Financial Statements.

Consolidated Statement of Changes in Shareholders' Equity

(EUR thousand)	Share capital	Share premium reserve	Legal reserve	Reserve of own shares	Fair value reserve	Other reserves	Retained earnings and losses	Group Profit &	Loss Group total	Non controlling interests	Consolidated shareholders' equity
Total at 31 December 2019	266,612	186,882	61,322	(10,415)	402	(17,930)	(41,665)	12,256	457,464	23,634	481,098
Allocation of 2019 net profit	0	0	0	0	0	0	12,256	(12,256)	0	0	0
Performance share / Stock option cost	0	0	0	0	0	1,331	0	0	1,331	0	1,331
Purchase of own shares	0	0	0	(120)	0	0	0	0	(120)	0	(120)
Treasury shares given for incentive plans	0	0	0	1,355	0	(1,138)	(217)	0	0	0	0
Dividend distribution	0	(31,340)	0	0	0	0	0	0	(31,340)	(1,193)	(32,533)
Other changes	0	0	0	0	0	989	(665)	0	324	665	989
Total comprehensive income (loss)	0	0	0	0	6	(191)	0	(1,441)	(1,626)	(6,471)	(8,097)
Total at 30 September 2020	266,612	155,542	61,322	(9,180)	408	(16,939)	(30,291)	(1,441)	426,033	16,635	442,668
(EUR thousand)	Share capital	Share premium reserve	Legal reserve	Reserve of own shares	Fair value reserve	Other reserves	Retained earnings and losses	Group Profit &	Loss Group total	Non controlling interests
Total at 31 December 2018	306,612	240,859	61,322	(82,766)	(179)	(18,555)	(51,882)	11,070	466,481	39,299	Consolidated shareholders' equity 505,780
Allocation of 2018 net profit	0	0	0	0	0	0	11,070	(11,070)	0	0	0
Stock option cost	0	0	0	0	0	389	0	0	389	0
Purchase of own shares
Treasury shares given for incentive plans	(40,000)	(22,780)	0	62,780	0	0	0	0	0	0	389 0
	0	0	0	1,525	0	(967)	(234)	0	324	0
Dividend distribution	0	(31,197)	0	0	0	0	0	0	(31,197)	(5,188)	324 (36,385)
Other changes Total comprehensive income (loss)	0 0	0 0	0 0	8,046 0	0 601	(189) (60)	(332) 0	0 6,454	7,525 6,995	(8,905) (1,007)	(1,380) 5,988

Pursuant to Consob Resolution 15519 of 27 July 2006, the impact of dealings with related parties on the Statement of Financial Position, Income Statement and Cash Flow Statement is explained in the Notes to the Financial Statements.

Notes to the Financial Statements

Structure and content of the Interim Consolidated Financial Statements at 30 September 2020

The Interim Consolidated Financial Statements at 30 September 2020 (the "Consolidated Financial Statements") comprise the document required by Article 2.2.3 of the Stock Exchange Regulation (FTSE Italia STAR segment).

The operating results, financial position and cash flows are prepared in conformity with the evaluation and measurement criteria established by the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB) and adopted by the European Union in accordance with the procedure laid down in Article 6 of Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002.

The accounting standards used in the Consolidated Financial Statements do not differ substantially from those used in the Financial Statements as at 31 December 2019.

The Consolidated Financial Statements at 30 September 2020 comprise the Consolidated Statement of Financial Position, the Consolidated Income Statement, the Consolidated Statement of Comprehensive Income (Statement of Performance), the Consolidated Cash Flow Statement, the Consolidated Statement of Changes in Shareholders' Equity and these Notes to the Financial Statements. They are also accompanied by the Interim Management Report and the Certification of the Interim Management Report.

The income and statement of cash flow information are provided for the first nine months of 2020 and 2019; the equity information is provided for 30 September 2020 and 31 December 2019.

The Consolidated Statement of Financial Position provides a breakdown of current and noncurrent assets and liabilities with separate reporting for those resulting from discontinued or held-for-sale operations. The Consolidated Income Statement provides a breakdown whereby costs and revenues are classified according to type. The Consolidated Cash Flow Statement is prepared using the "direct method".

Unless otherwise indicated, all tables and figures included in these Notes to the Financial Statements are reported in EUR thousand.

The accounts of the Consolidated Financial Statements are not audited by the Independent Auditors.

Statement of compliance with accounting standards

The Consolidated Financial Statement was prepared in accordance with the going concern principle and with the International Accounting Standards adopted by the European Union and approved by the date this document was prepared (the International Accounting Standards, or individually, IAS/IFRS, or collectively IFRS – International Financial Reporting Standards), and in accordance with art. 154-ter of Legislative Decree 58/1998 that implements the "Transparency Directive".

When preparing the Consolidated Financial Statements, all interpretations of the International Financial Reporting Interpretations Committee (IFRIC) were applied, including those previously issued by the Standing Interpretations Committee (SIC), approved by the European Union.

In accordance with the provisions of IAS/IFRS and current legislation, the Company has authorised the publication of the Interim Financial Statements at 30 September 2020 under the terms of the law.

Use of estimates and assumptions in preparing the Consolidated Interim Financial Statements at 30 September 2020

The Company must make assessments, estimates and assumptions that affect the application of accounting standards and the amounts of assets, liabilities, costs and revenues recorded in the financial statements. Estimates and related assumptions are based on past experience and factors deemed reasonable in the case concerned; these are used to estimate the carrying value of assets and liabilities that cannot be easily obtained from other sources. Since these are estimates, the results obtained should not necessarily be considered definitive.

These estimates and assumptions are reviewed regularly. Any changes resulting from revisions of accounting estimates are reported in the period in which the revision takes place if they involve that period only; if the revision involves current and future periods, the change is reported in the period in which the revision takes place and in future periods.

While stressing that the use of reasonable estimates is an essential part of preparing the Interim Consolidated Financial Statements as at 30 September 2020, note that this use of estimates is particularly significant with reference to the valuations of the assets and shareholdings in the investment portfolio.

An estimate may be adjusted as a result of changes in the circumstances on which it was based, or as a result of new information. Any change in the estimate is applied prospectively and has an impact on the results for the period in which the change occurred, and potentially on those in future periods.

As permitted by IAS/IFRS, the preparation of the Interim Consolidated Financial Statements as at 30 September 2020 required the use of significant estimates by the Company's management, especially with regard to fair value measurements of the investment portfolio (shareholdings and funds).

These fair value measurements are determined by the Directors based on their best estimates and judgement, using their knowledge and the evidence available at the time the Interim Consolidated Financial Statements as at 30 September 2020 were prepared. However, due to objective difficulties in making assessments and the absence of a liquid market, the values assigned to such assets could differ, and in some cases significantly, from those that could actually be obtained when the assets are sold.

In addition, the current situation of instability and uncertainty of the macro-economic framework following the occurrence of the COVID-19, which, above all, can affect the future enhancement capacity of the assets in the portfolio, consequently renders these estimates and valuations even more difficult, inevitably incorporating elements of uncertainty.

For a more detailed description of the most important valuation processes for the Group, refer to the Consolidated Financial Statements as at 31 December 2019.

Scope of consolidation

As at 30 September 2020, the following companies formed part of the DeA Capital Group's scope of consolidation:

Company	Registered office Currency		Share capital	% holding	Consolidation method
DeA Capital S.p.A.	Milan, Italy	Eur	266,612,100	Holding
DeA Capital Alternative Funds SGR S.p.A.	Milan, Italy	Eur	1,300,000	100.00%	Full consolidation
IDeA OF I	Milan, Italy	Eur	-	46.99%	Full consolidation
DeA Capital Partecipazioni S.p.A.	Milan, Italy	Eur	600,000	100.00%	Full consolidation
DeA Capital Real Estate SGR S.p.A.	Rome, Italy	Eur	16,757,557	100.00%	Full consolidation
DeA Capital Real Estate France S.A.S.	Paris, France	Eur	100,000	70.00%	Full consolidation
DeACapital Real Estate Iberia S.L.	Madrid, Spain	Eur	100,000	73.00%	Full consolidation
DeA Capital Real Estate Poland Sp. z o.o.	Warsaw, Poland	PLN	2,000,000	50.00%	Equity Accounted (Joint
Quaestio Holding S.A.	Luxembourg	Eur	4,839,630		venture) 38.82% Equity accounted (Associate)
YARD Group	Milan, Italy	Eur	690,100		38.98% Equity accounted (Associate)
IDeA Efficienza Energetica e Sviluppo Sostenibile	Milan, Italy	Eur	-		30.40% Equity accounted (Associate)
Venere	Rome, Italy	Eur	-		27.27% Equity accounted (Associate)

Notes on the Consolidated Statement of Financial Position

NON-CURRENT ASSETS

Non-current assets stood at EUR 345.9 million as at 30 September 2020 (compared with EUR 420.6 million as at 31 December 2019).

1 - Tangible and intangible fixed assets

The item includes goodwill (EUR 99.9 million), other intangible assets (EUR 26.0 million) and tangible assets (EUR 12.4 million).

The item Goodwill, amounting to EUR 99.9 million as at 30 September 2020, refers to the goodwill recorded in relation to the acquisition of IFIM/FIMIT SGR (now DeA Capital Real Estate SGR) for EUR 62.4 million and the investment in DeA Capital Alternative Funds SGR of EUR 37.5 million, this latter amount relating, for EUR 6.2 million, to the acquisition completed by DeA Capital Alternative Funds SGR on 5 November 2019 of the NPL Management Business Unit of Quaestio SGR (essentially consisting of the management mandates of the Atlante and Italian Recovery Fund funds, as well as the team and the contracts related to the aforementioned management mandates).

Intangible fixed assets mainly refer to Customer Contracts, which derive from the allocation of the costs of the combinations for the acquisitions of FIMIT SGR and for the acquisition, finalised by DeA Capital Alternative Funds, of the NPL Management BU of Quaestio SGR.

Tangible assets include the rights of use of the building in Via Brera 21 in Milan for the portion pertaining to Group companies, accounted for in accordance with IFRS 16.

2 – Financial investments and other non-current assets

2a – Investments in associates

The item, equal to EUR 26.6 million at 30 September 2020 (compared to EUR 30.8 million as at 31 December 2019), refers to the investments in Quaestio Holding / Quaestio SGR, DeA Capital Real Estate Poland, YARD and portions in the IDeA EESS and in the Venere funds.

The table below provides details of the investments held in associates as at 30 September 2020 by sector of activity:

(EUR million)	Alternative Investment	Alternative Asset Management	Total
Quaestio Holding S.A.	0.0	13.9	13.9
DeA Capital Real Estate Poland	0.0	0.0	0.0
IDeA EESS fund	3.6	0.0	3.6
Venere fund	0.7	1.4	2.1
YARD group	0.0	7.0	7.0
Total	4.3	22.3	26.6

2b – Investments held by funds measured at fair value through P&L

As at 30 September 2020, the DeA Capital Group holds, through the IDeA OF I fund, minority interests in Iacobucci HF Electronics and Pegaso Transportation Investments (Talgo). This item, totalling EUR 14.7 million as at 30 September 2020 (compared with EUR 22.8 million as at 31 December 2019) breaks down as follows:

(EUR million)	30.9.2020	31.12.2019
Participations in Portfolio
Iacobucci HF Electronics	3.0	3.0
Pegaso Transportation Investments (Talgo)	11.7	19.8
Investments at Fair Value through P&L	14.7	22.8
Total Participations in Portfolio	14.7	22.8

2c – Investments held in other companies measured at fair value through P&L

As at 30 September 2020, the DeA Capital Group was a minority shareholder in Kenan Investments (the holder of an investment in Migros), ToI Due (which holds an investment in Alice Pizza), and other minor equity investments. As at 30 September 2020, this item was EUR 28.9 million, compared with EUR 50.4 million as at 31 December 2019.

The table below provides a breakdown of shareholdings in other companies as at 30 September 2020 by area of activity:

(EUR million)	Alternative Investment - Other investments	Alternative Investment - Platform Investments	Alternative Asset Management	Total
Kenan Investments	19.1	0.0	0.0	19.1
ToI Due	5.0	5.0	0.0	5.0
Minority interests	4.8	0.0	0.0	4.8
Total	23.9	5.0	0.0	28.9

2d – Funds measured at fair value through P&L

The item Funds measured at fair value through P&L relates to investments in units of three funds of funds (IDeA I FoF, ICF II and ICF III), 3 thematic funds (IDeA ToI, IDeA ToI 2 and IDeA Agro) 2 NPE funds (IDeA CCR I and IDeA CCR II), 5 venture capital funds and 10 real estate funds, totalling EUR 126.3 million in the Consolidated Financial Statements as at 30 September 2020 (compared with EUR 143.6 million as at 31 December 2019).

The table below provides a breakdown of the funds in the portfolio as at 30 September 2020 by area of activity:

(EUR million)	Alternative Investment - Other Investments	Alternative Investment - Platform Investments	Alternative Asset Management	Total
Venture capital funds	0.4	0.0	0.0	0.4
IDeA I FoF	0.0	17.4	0.0	17.4
ICF II	0.0	27.3	0.0	27.3
ICF III	0.0	12.1	0.0	12.1
IDeA ToI	0.0	16.4	0.0	16.4
IDeA ToI 2	0.0	0.1	0.0	0.1
IDeA CCR I	0.0	1.0	0.0	1.0
IDeA CCR II	0.0	5.8	0.0	5.8
IDeA Agro	0.0	1.4	0.0	1.4
Santa Palomba	0.0	0.6	0.0	0.6
DeA Capital Real Estate SGR funds	0.0	0.0	43.4	43.4
DeA Capital Alternative Funds SGR funds	0.0	0.0	0.4	0.4
Total funds	0.4	82.1	43.8	126.3

3a – Deferred tax assets

The balance of the item "Deferred tax assets" comprises the value of deferred tax assets minus deferred tax liabilities, where they may be offset. As at 30 September 2020, deferred tax assets totalled EUR 3.9 million, compared with EUR 2.4 million as at 31 December 2019.

3b – Loans and receivables

The item, amounting to EUR 4.8 million as at 30 September 2020, compared with EUR 2.5 million as at 31 December 2019, refers to the receivable from the associated company YARD that arose as a result of the sale to the same of a stake equal to 100% of SPC by DeA Capital Partecipazioni, the receivables of the latter from YARD Group itself and from the real estate initiatives promoted by DeA Capital Real Estate France as well as loans to employees.

3c – Financial receivables for non-current leases

The item, which amounted as at 30 September 2020 to EUR 1.1 million compared with EUR 1.3 million as at 31 December 2019, refers to the receivable claimed by DeA Capital S.p.A. in respect of the companies of the De Agostini Group for the use of the spaces of the building at Via Brera, 21 Milan.

3d – Other non-current assets

This item totalled EUR 1.3 million as at 30 September 2020 (EUR 5.0 million as at 31 December 2019) and relates to the receivable from the Parent Company De Agostini S.p.A. for adhesion in the tax consolidation scheme by DeA Capital S.p.A.

CURRENT ASSETS

4 – Current assets

As at 30 September 2020, the item totalled EUR 183.2 million, versus EUR 171.9 million at 31 December 2019. The item mainly comprised:

• - EUR 118.0 million relating to cash and cash equivalents (EUR 99.5 million as at 31 December 2019);
• - EUR 11.3 million for trade receivables (EUR 8.7 million as at 31 December 2019);
• - EUR 14.2 million relating to investments to be considered as temporary use of liquidity (unchanged compared to 31 December 2019);
• - EUR 31.5 million relating to tax credits (EUR 37.2 million as at 31 December 2019), which mainly refer to the VAT credits of DeA Capital Real Estate SGR, the credits for tax withholdings and the IRAP credit.

SHAREHOLDERS' EQUITY

5 – Shareholders' equity

Group shareholders' equity

As at 30 September 2020, Group shareholders' equity was EUR 426.0 million, compared with EUR 457.5 million as at 31 December 2019. The negative change in Group Shareholders' equity in the first nine months of 2020, amounting to EUR -31.5 million, is mainly attributable to the extraordinary dividend paid by DeA Capital S.p.A. (EUR -31.3 million).

Minority interest shareholders' equity

As at 30 September 2020, Minority interest shareholders' equity was EUR 16.6 million, compared with EUR 23.6 million as at 31 December 2019. This item at 30 September 2020 mainly refers to the Shareholders' Equity pertaining to minority interests resulting from the consolidation (using the line-by-line method) of the IDeA OF I fund. The negative change compared with the

balance as at 31 December 2019, amounting to a total of EUR -7.0 million, mainly includes the period result of the IDeA OF I fund pertaining to minority interests.

NON-CURRENT LIABILITIES

As at 30 September 2020, the Non-current liabilities result totalled EUR 27.9 million, compared with EUR 26.5 million as at 31 December 2019.

6a – Payables to suppliers

As at 30 September 2020, the item result is EUR 0.8 million, (unchanged compared with 31 December 2019).

6b – Deferred tax liabilities

As at 30 September 2020 this item totalled EUR 5.8 million (compared with EUR 6.0 million as at 31 December 2019) and includes, specifically the liabilities for deferred taxes for DeA Capital Real Estate SGR, composed in full of the offsetting item relating to the deferred tax of intangible assets from variable fees recorded in the assets.

6c – End-of-service payment fund

As at 30 September 2020, this item totalled EUR 6.2 million (compared with EUR 5.6 million as at 31 December 2019); the end-of-service payment comes under defined-benefit plans and was therefore valued by applying the actuarial methodology.

6d – Financial liabilities

As at 30 September 2020, the item result totalled EUR 14.0 million, compared with EUR 13.5 million as at 31 December 2019. The item mainly refers to the financial payable related to the lease agreements for vehicles in use, as well as the leasing of properties, the Group company offices, specifically the property at Via Brera 21 in Milan and the Rome office of DeA Capital Real Estate SGR.

CURRENT LIABILITIES

7 – Current liabilities

As at 30 September 2020, the item totalled EUR 58.5 million (EUR 85.0 million as at 31 December 2019), and refers to Payables to Suppliers (EUR 5.2 million), Payables to personnel and Social security institutions (EUR 9.1 million), Current tax payables and Other payables to the tax authorities (EUR 5.6 million), Other payables (EUR 35.5 million) and Short-term financial payables (EUR 3.1 million).

Notes on the Consolidated Income Statement

8 – Alternative asset management fees

In the first nine months of 2020, fees from Alternative Asset Management amounted to EUR 51.5 million (or EUR 51.4 million net of eliminations) compared to EUR 48.0 million (or EUR 47.7 million net of eliminations) in the corresponding period of 2019.

These fees mainly relate to management fees paid to DeA Capital Real Estate SGR and DeA Capital Alternative Funds SGR for the funds that they manage.

9 – Income from investments valued at equity

This item includes income from the associates valued at equity for the period.

The item, EUR -0.6 million in the first nine months of 2020 compared with EUR -0.2 million in the first nine months of 2019, is primarily attributable pro-rata to the result of the equity investments in YARD, Quaestio Holding / Quaestio SGR, DeA Capital Real Estate Poland, as well as in the Venere and IDeA EESS funds.

10 – Other investment income/expense

Other net income realised on investments in shareholdings and in funds stood at EUR -11.7 million in the first nine months of 2020, compared with EUR +3.5 million in the corresponding period of 2019. The item mainly refers to the revaluation of the investment in Kenan Investments / Migros andthe negative fair value adjustment of t the investment in Pegaso Transportation Investments (Talgo) held by the IDeA OF I fund.

11a – Personnel costs

The total cost of personnel stood at EUR 29.3 million in the first nine months of 2020 (EUR 23.5 million in the corresponding period of 2019).

11b – Service costs

Service costs stood at EUR 10.1 million in the first nine months of 2020 (EUR 11.0 million in the corresponding period of 2019).

11c – Depreciation, amortisation and impairment losses

Depreciation, amortisation and impairment amounted to EUR 3.8 million in the first nine months of 2020, compared to EUR 3.6 million in the corresponding period of 2019, and substantially include the amortisation of the purchase price allocation due to the NPL Management BU acquired by DeA Capital Alternative Funds SGR at the end of 2019, as well as the assets recorded in the Balance Sheet following the application of IFRS 16 (leased vehicles and properties, in particular the building in Via Brera 21 in Milan, which has been leased to the DeA Capital Group since 2013, and the Rome property of DeA Capital Real Estate SGR).

11d – Other costs

Other costs stood at EUR 3.1 million in the first nine months of 2020 (EUR 2.6 million in the corresponding period of 2019). The item mainly consists of the impairment of receivables for management fees of DeA Capital Real Estate SGR and the non-deductible pro-rata VAT on the costs pertaining to the period of DeA Capital Real Estate SGR and DeA Capital Alternative Funds SGR.

12 – Financial income (expense)

In the first nine months of 2020 financial income totalled EUR +0.3 million (EUR +0.8 million in the corresponding period of 2019) and financial expense stood at EUR -2.7 million (EUR -1.0 million in the corresponding period of 2019).

13 – Income tax

Income taxes amounted to EUR +1.1 million in the first nine months of 2020 (compared to EUR -4.9 million in the corresponding period of 2019), also thanks to the benefit at DeA Capital Alternative Funds SGR level, (i) from the net positive effect due to the release of the deferred tax payable recognised upon completion of the PPA process relating to the acquisition of the NPL Management BU, following the tax exemption of intangible assets from customer relationships and (ii) from the net positive effect due to the recognition of deferred tax assets, against the tax benefit connected to the future deductibility of goodwill, also subject to tax redemption, net of the recognition of the cost for substitute tax.

Other information

Transactions with parent companies, subsidiaries and related parties

Transactions with related parties, including those with other Group companies, were carried out in accordance with the Procedure for Related Party Transactions adopted by the Company with effect from 1 January 2011, in accordance with the provisions of the Regulation implemented pursuant to art. 2391-bis of the Italian Civil Code with Consob Resolution 17221 of 12 March 2010, as subsequently amended.

In the first nine months of 2020, the Company did not carry out any atypical or unusual transactions with related parties, only those that are part of the normal business activities of Group companies. It also did not carry out any "significant transactions" as defined in the abovementioned procedure.

Transactions with related parties during the first nine months of 2020 were concluded at arm's length, taking into account the nature of the goods and/or services offered.

With regard to transactions with parent companies, note the following:

1. DeA Capital S.p.A. has signed a service agreement with the controlling shareholder, De Agostini S.p.A., for the latter to provide operating services in tax matters. The Contract, tacitly renewed from year to year, envisages economic market conditions.

At the same time, on 1 January 2013, DeA Capital S.p.A. signed an "Agreement to sublet property for intended use other than residential use" with the controlling shareholder, De Agostini S.p.A. The agreement relates to parts of a building located at Via Brera 21, Milan, comprising spaces for office use, warehousing and car parking. Said Contract, which is renewable every six years after an initial term of seven years, is priced at market rates.

1. DeA Capital S.p.A., DeA Capital Partecipazioni, DeA Capital Alternative Funds SGR and DeA Capital Real Estate SGR have adopted the national tax consolidation scheme of the De Agostini Group (the Group headed by De Agostini S.p.A.). This option was exercised jointly by each company and De Agostini S.p.A. through the signing of the "Regulation for participation in the national tax consolidation scheme for companies in the De Agostini Group" and by notifying the tax authorities of this option pursuant to the terms and conditions laid down by law. The option is irrevocable unless the requirements for applying the scheme are not met.

The option is irrevocable for DeA Capital S.p.A. for the three-year period 2017-2019, for DeA Capital Partecipazioni for the three-year period 2019-2021, for DeA Capital Alternative Funds SGR for the three-year period 2018-2020 and for DeA Capital Real Estate SGR for the three-year period 2019-2021.

1. In order to allow more efficient use of liquidity and the activation of credit lines with potentially better terms and conditions than those that may be obtained from banks, DeA Capital S.p.A. has signed a framework agreement (Framework Agreement) with the Parent Company De Agostini S.p.A. for the provision of short-term intercompany loans/deposits. Deposit/financing operations in this Framework Agreement can only be carried out subject to verification that the terms and conditions, as determined from time to time, are advantageous, and will be provided on a revolving basis, and with maturities of not more than three months. The Framework Agreement has a duration of one year and is tacitly renewed each year.

The amounts involved in the deposit/financing operations will, however, always be below the thresholds defined for "transactions of lesser importance" pursuant to Consob Regulation 17221/2010 (Transactions with Related Parties) and the internal Procedure for Related-Party Transactions adopted by DeA Capital S.p.A.

Note that there were no deposit/financing operations between DeA Capital S.p.A. and De Agostini S.p.A. arising from the above-mentioned Framework Agreement.

Significant events after the end of the period and outlook

SIGNIFICANT EVENTS AFTER THE END OF THE PERIOD

After the end of the period, as part of the expansion of the interational activities in Real Estate, two transactions were finalised in the French market, for a total of approximately EUR 70 million.

OUTLOOK

With regard to the business outlook, especially the macro-economic framework, the global spread of COVID-19 should be considered and to this end, the Group has promptly adopted all the necessary measures to protect the health of employees and ensure business continuity.

Even in this environment, the DeA Capital Group has continued and will continue to focus on developing the Alternative Asset Management Platform, through new product launches, the further growth of international activities, and the coordination with Quaestio SGR, especially insofar as the go-to-market strategy. Moreover, we will direct our utmost efforts to protecting and supporting all the assets comprising the funds under management, to overcome the acute phase of the crisis and be poised to reap the opportunities that will undoubtedly become available once the crisis is over.

Certification of the Interim Management Report as at 30 September 2020

Certification of the Interim Management Report at 30 September 2020 (pursuant to Article 154-bis of Legislative Decree 58/98)

Manolo Santilli, Chief Operating Officer and the Manager responsible for preparing the Company's accounts, hereby declares, pursuant to Article 154-bis, paragraph 2 of the Consolidated Finance Act (TUF), that the financial information contained in this document accurately represents the figures in the Company's accounting records.

Milan, 10 November 2020

Manolo Santilli Manager responsible for preparing the Company's accounts