Fielmann AG — Interim / Quarterly Report 2023

Nov 9, 2023

INTERIM STATEMENT AS AT 30 SEPTEMBER 2023

Fielmann Group: Interim Statement as at 30 September 2023

Dear shareholders and friends of the company,

With Germany in recession and consumer confidence levels declining across Europe in Q3/2023, customers choose providers that offer guaranteed quality and services at the best price. In optical and acoustic retail this is the Fielmann Group. As the price leader, the German family business makes vision and hearing affordable and grows its market shares. Our Vision 2025 investments in the digitalisation and internationalisation of our organisation continue to result in the outperformance of digital sales channels and international markets while the Cost Leadership Program helps improve margins in line with our prognosis and long-term strategy.

The Fielmann Group AG completed the acquisition of the optical retailer SVS Vision with effect from 1 September 2023. SVS Vision is the market leader in Michigan and operates more than 80 stores in nine US states. Together with the e-commerce platform Befitting, acquired in June 2023, these two acquisitions represent an important milestone of Vision 2025, our framework to further internationalise and digitalise our family-run business.

Report on financial performance, cash flows and financial position

Q1-Q3/2023

Compared with the previous year, the Fielmann Group improved its unit sales of glasses in the first three quarters by 3.9% to 6.64 million (previous year: 6.39 million). External sales incl. VAT and changes to inventories rose in the same period by 13.0% to € 1.73 billion (previous year: € 1.53 billion) and consolidated sales increased by 13.7% to € 1.50 billion (previous year: € 1.32 billion).

When comparing the two nine-month periods, EBITDA increased to € 338.6 million (previous year: € 267.5 million). Earnings before taxes (EBT) grew by € 32.1 million to € 173 million (previous year: € 141.0 million).

Q3/2023

Fielmann increased its sales of glasses in the third quarter of 2023 by 2.1% to 2.27 million (previous year: 2.23 million glasses. External sales grew by 12.2% to € 601.6 million (previous year: € 536.4 million) and consolidated sales rose by 13.8 % to € 526.4 million (previous year: € 462.7 million). In the third quarter, EBITDA reached € 130.4 million (previous year: € 96.1 million). Third-quarter EBT increased by 25.1% to € 65.0 million (previous year: € 52.0 million).

Business performance

Vision 2025 investments in the digitalisation and internationalisation of our family business contributed to an outperformance of our digital channels (+16.2% over last year) as well as our international business (+20.8% over last year). Excluding acquisitions, our international business still grew 11.4% over last year.

While Switzerland grew +6.0% percent over the first nine months of last year, Germany, Austria, Italy and Poland grew at double digits over last year. Spain reached an impressive sales growth of +42.4% over last year. Our newly acquired operations in the United States were consolidated for the first time in the month of September, adding +5% to the Group's topline in the individual month and +2% in Q3/2023.

The main drivers of our positive development in Q3 were strong organic growth in existing markets amounting to +10.0% compared to prior year and acquisitions contributing an additional growth of +3.8% TLY in the quarter.

While demographic change drives demand for eye care services across Central Europe, the number of ophthalmologists is decreasing. To address this gap and to help customers, Fielmann introduces an innovative new service in collaboration with Ocumeda – a start-up founded by Swiss ophthalmologists: Certified opticians take images of the retina and measure the intraocular pressure with state-of-the-art equipment in Fielmann stores. Subsequently, the data is digitally transferred to ophthalmologists who conduct an assessment and provide customers with feedback within a few days. Customers with findings receive a recommendation to consult local ophthalmologists or clinics for diagnostics and treatment. Marc Fielmann, CEO of the Fielmann Group: "Fielmann helps everyone hear and see the beauty in the world. Every year, thousands of Germans unnecessarily go blind. This number can be significantly reduced by means of regular eye health screenings. Together with our partners in ophthalmology we are proud to make them easily and quickly accessible to everyone." After piloting and improving the service for two years, eye health screenings are currently being rolled out to more than 100 stores in Germany and Switzerland. To-date more than 14.000 customers have already had their eye health checked in Fielmann stores.More information on Fielmann's Eye Health Service is available via www.fielmann.de/augen-check-up (German).

Financial position

The financial assets were influenced by the distribution of the dividend resolved by the Annual General Meeting of Fielmann Group on 13 July 2023. The dividend for the financial year 2022 amounted to € 63.0 million, corresponding to € 0.75 per share. The payment of the purchase price for the investment in SVS Vision also had an impact.

Investments in tangible and intangible assets relate to the implementation of Vision 2025 and amounted to € 219.4 million after three quarters (previous year: € 46.6 million). The investments were financed from our cash flow, existing cash and a bridge financing. As at 30 September, the Fielmann Group operated digital sales channels in almost all markets as well as 1,075 stores (previous year: 936), 379 of which include hearing aid studios (previous year: 326).

Accounting and valuation policies

The interim report as at 30 September 2023 is based on the same accounting and valuation policies as the consolidated annual financial statement as at 31 December 2022. It was compiled according to International Financial Reporting Standards (IFRS and IAS). External services have been assessed more appropriately, a reclassification was made between cost of materials and "Other operating expenses". This led to a reduction in the cost of materials by a total of € 13.6 million in the third quarter compared to the previous statement. No reclassification was made for the same period of last year owing to its insignificance.

The result for the comparative period takes into account the actual tax ratio of fiscal year 2022.

Employees

Fielmann is one of the largest employers and training providers in the optical industry, with 23,870 employees as at 30 September (previous year: 22,640), of whom 4,289 are apprentices (previous year: 4,310).

Outlook, forecast, opportunities and risk report

In an environment marked by political conflicts, high inflation levels and low consumer spending, the Fielmann Group reports a very positive performance. We benefit from the fact that customers are choosing to buy from the price leader. In view of the positive development of our existing European markets and the contribution of our recent acquisitions in the United States of America, we anticipate external sales (incl. VAT and inventory changes) of approx. € 2.3 billion in 2023, which represents a 13% increase on the previous year. Consolidated sales are set to increase to the same extent to approx. € 2.0 billion. We expect disproportionately greater EBITDA growth to approx. € 400 million (+18% on the previous year). Earnings before taxes (EBT) will increase to over € 190 million, which also corresponds to growth of +18%.

Looking forward, we are optimistic that our Vision 2025 investments will continue to drive our topline growth while our Cost Leadership Program puts us on track to reach the EBITDA margin as communicated in our Vision 2025 plan.

Hamburg, November 2023 Fielmann Group AG

The Management Board

6 Third quarter 2023

Segment reporting 1 January to 30 September The previous year's figures are stated in parentheses.

Consolidated value

in € million	Germany	Switzerland	Austria
Sales revenues from the segment	1,121.6 (1,005.3)	163.7 (154.0)	69.5 (62.8)
Sales revenues from other segments	78.9	0.3	0.1
	(64.5)	(0.0)	(0.2)
External sales	1,042.7	163.4	69.4
	(940.8)	(154.0)	(62.6)
Cost of materials	260.3	27.3	16.1
	(244.9)	(30.6)	(13.8)
Personnel costs	470.5	67.2	27.9
	(421.3)	(61.5)	(25.6)
Scheduled depreciation	79.5	13.9	4.9
	(79.1)	(13.3)	(5.5)
Expenses in the financial result	6.1	1.2	0.9
	(3.1)	(0.4)	(0.3)
Income in the financial result	1.5	1.0	0.1
	(4.8)	(0.2)	(0.0)
Result before taxes
– in segments excl. investment income	145.1	36.3	14.0
	(118.8)	(22.3)	(7.9)
Taxes on income and earnings	44.7	5.8	2.2
	(37.7)	(3.5)	(1.0)
Net profit for the period	100.4	30.5	11.8
	(81.1)	(18.8)	(6.9)

Financial calendar 2024

Preliminary figures for 2023	February 2024
Interim report	25 April 2024
Annual General Meeting	11 July 2024
Bloomberg	FIE
Reuters	FIEG.DE
Securities ID number/ISIN	DE0005772206

Consolidated value	Consolidation		Other		Spain
1,497.3 (1,317.2)	(–71.8)	–86.8	(75.5)	99.2	(91.4)	130.1
			(7.1)	7.5
1,497.3 (1,317.2)			(68.4)	91.7	(91.4)	130.1
318.7 (287.2)	(–61.9)	–63.7	(28.0)	32.8	(31.8)	45.9
643.9 (564.6)			(26.8)	35.0	(29.4)	43.3
148.9 (126.6)			(15.5)	32.2	(13.2)	18.4
15.7 (5.8)	(–0.2)	–2.0	(0.8)	2.0	7.5 (1.4)
0.9 (4.8)	(–0.2)	–2.0	(0.0)	0.3
173.1 (141.0)	(–0.3)	0.0	(–16.1)	–25.6	3.3 (8.4)
53.7 (44.5)	(–0.1)	0.0	(0.3)	–1.0	2.0 (2.1)
119.4 (96.5)	(–0.2)	0.0	(–16.4)	–24.6	1.3 (6.3)

Further information:

Fielmann Group AG Investor Relations · Ulrich Brockmann Weidestrasse 118 a · 22083 Hamburg, Germany Phone: +494027076-442 · Fax: +494027076-150 E-mail: investorrelations@fielmann.com · www.fielmann-group.com

Consolidated profit and loss account

For the period from 1 July to 30 September	3rd Quarter 2023 in €000s	3rd Quarter 2022 in €000s	Change from previous year in %
1. Consolidated sales	526,431	462,668	13.8
2. Changes in inventories	–5,434	2,880	–288.7
3. Total consolidated sales	520,997	465,548	11.9
4. Other operating income	4,007	6,678	–40.0
5. Cost of materials	–106,191	–103,292	2.8
6. Personnel costs	–211,129	–192,618	9.6
7. Other operating expenses	–77,329	–80,210	–3.6
8. Result before interest, taxes and depreciations	130,355	96,106	35.6
9. Depreciation of right-of-use assets	–28,981	–22,617	28.1
10. Other depreciations	–28,939	–19,420	49.0
11. Interest expenditure from leases	–3,428	–1,707	100.8
12. Other expenses in the financial result	–4,332	–272	1,492.6
13. Income in the financial result	322	–135	–338.5
14. Result before taxes	64,997	51,955	25.1
15. Taxes on income and earnings	–20,155	–16,404	22.9
16. Net income for the quarter	44,842	35,551	26.1
17. Income attributable to minority interests	–1,532	–2,049	–25.2
18. Profits to be allocated to parent company shareholders	43,310	33,502	29.3
Earnings per share in € (diluted/basic)	0,52	0,40

Consolidated profit and loss account

For the period from 1 January to 30 September	2023 in €000s	2022 in €000s	Change from pre vious year in %
1. Consolidated sales	1,497,341	1,317,213	13.7
2. Changes in inventories	3,970	11,670	–66.0
3. Total consolidated sales	1,501,311	1,328,883	13.0
4. Other operating income	10,797	13,425	–19.6
5. Cost of materials	–318,749	–287,187	11.0
6. Personnel costs	–644,002	–564,584	14.1
7. Other operating expenses	–210,790	–223,003	–5.5
8. Result before interest, taxes and depreciations	338,567	267,534	26.6
9. Depreciation of right-of-use assets	–78,542	–68,071	15.4
10. Other depreciations	–72,152	–57,475	25.5
11. Interest expenditure from leases	–9,234	–4,383	110.7
12. Other expenses in the financial result	–6,473	–1,421	355.5
13. Income in the financial result	939	4,833	–80.6
14. Result before taxes	173,105	141,017	22.8
15. Taxes on income and earnings	–53,669	–44,524	20.5
16. Consolidated net income for the period	119,436	96,493	23.8
17. Income attributable to minority interests	–4,514	–5,037	–10.4
18. Profits to be allocated to parent company shareholders	114,922	91,456	25.7
Earnings per share in € (diluted/basic)	1,37	1,09

"We help everyone hear and see the beauty in the world."

Third quarter 2023 9

Fielmann Group AG · Weidestraße 118 a · D-22083 Hamburg Telephone: +49(0)40/27076 - 0 · Fax: +49(0)40/27076 - 399 E-mail: investorrelations@fielmann.com · Internet: www.fielmann.com