Fila — Investor Presentation 2021

Aug 5, 2021

H1 2021 FILA Group Results

Disclaimer

.

This document has been prepared by F.I.L.A. S.p.A. ("F.I.L.A." or the "Company"), for information purposes only, exclusively with the aim of assisting you to understand and assess F.I.L.A.'s activities. Statements contained in this presentation, particularly regarding any possible or assumed future performance of the F.I.L.A. Group, are or may be forward-looking statements based on F.I.L.A.'s current expectations and projections about future events. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond F.I.L.A.'s control. These risks, uncertainties and factors may cause F.I.L.A.'s actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements (and from past results, performances or achievements). Forward-looking statements are not guarantees of future performance. Consequently, F.I.L.A. and its management can give no assurance regarding the future accuracy of the estimates of future performance set forth in this document or the actual occurrence of the expected developments. The data and information contained in this document are subject to changes and integrations. Although F.I.L.A. reserves the right to make such changes and integrations when it deems necessary or appropriate, F.I.L.A. assumes no affirmative obligation to update, change or integrate this document, except as and to the extent required by law. Any reference to the past performance of the F.I.L.A. Group shall not be taken as an indication of future performance. In addition, this presentation includes certain ''Adjusted'' financial and operating indicators and non-IFRS measures, which have been adjusted to reflect extraordinary events, non-recurring and/or non-monetary transactions and/or activities that are not directly related to the Group's ordinary business. These measures are not indicative of our historical operating results, nor are they meant to be predictive of future results. These measures are used by F.I.L.A.'s management to monitor the underlying performance of the business and the operations. Since not all companies calculate these measures in an identical manner, F.I.L.A.'s presentation may not be consistent with similar measures used by other companies. Such "Adjusted" information has been included to facilitate the comparison of financial information among different financial periods; however, it should be noted that such information is not recognized as a measure of financial performance or liquidity under IFRS and/or does not constitute an indication of the historical performance of the Company or the Group. Therefore, investors should not place undue reliance on such data and information. The information contained in this document does not constitute or form any part of, and should not be construed as, any offer, invitation or recommendation to purchase, sell or subscribe for any securities in any jurisdiction and neither the issue of the information nor anything contained herein shall form the basis of or be relied upon in connection with, or act as any inducement to enter into, any investment activity. This document does not purport to contain all of the information that may be required to evaluate any investment in the Company or any of its securities and should not be relied upon to form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. This presentation is intended to present background information on F.I.L.A., its business and the industry in which it operates and is not intended to provide complete disclosure upon which an investment decision could be made. The merit and suitability of investment in F.I.L.A. should be independently evaluated and determined by investors. Analyses in this presentation are not, and do not purport to be, appraisals of the assets, stock or business of F.I.L.A., and do not form any publicity material relating to the securities. Any person considering an investment in F.I.L.A. is advised to obtain independent advice as to the legal, tax, accounting, regulatory, financial, credit and other related advice prior to making an investment.

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H1 2021 Highlights

• ˗ Adjusted Core Business Sales of 324,7 mln €, +5,6% (+17,1mln €) on the same period of the previous year (307,6mln € in H1 2020); +11,1% at comparable FX rates (+34,2mln €), Fine Art + 13%, School&Office +9,4% and Industrial +28,6% vs H1 2020;
• ˗ Adjusted EBITDA, excluding IFRS 16 impact, of 58,5mln €, +26,8% (+12,4mln €) on the same period of the previous year (46,2mln € in H1 2020); +30,8% at comparable FX rates (+14,2mln €), mainly related to Europe and North America performance;
• ˗ EBITDA margin at 18% (15% in H1 2020) due to better operating margin related to the continuous Fine Art growth, to the strong recovery in School&Office sales in Europe and North America and to a better Sale Price/Mix compared to H1 2020;
• ˗ COVID-19 impacts on India and Mexico Sales (+1,3mln € vs H1 2020 but -21,3mln € vs H1 2019) and EBITDA (-2,4mln € vs H1 2020 and -5,3 mln € vs H1 2019), including FX rates effects;
• ˗ Adjusted Net Result of 26,6mln € with a strong improvement vs H1 2020 (+9,5mln € in H1 2020);
• ˗ Net Bank Debt of 425,5mln € (396,1mln € as at 31 December 2020 and 503,9mln € as at 30 June 2020) with a decrease in last twelve months of 78,4mln € including positive FX effect of approx. 11mln €;
• ˗ "Free Cash Flow to Equity" at -17,4mln € due to business seasonality impact, better than H1 2020 (-62,9mln €).

H1 2021 Highlights

For a better analysis of H1 2021 results, hereunder the comparison of the last three years, considering the Covid 19 impacts on H1 2020 and H1 2021 (FX effects included).

(€ million)	H1 2019A	H1 2020A	H1 2021A
Core Business Sales Adjusted	350,7	307,6	324,7
Ebitda Adjusted (excluded IFRS16)	58,2	46,2	58,5
Ebitda Margin %	16,6%	15,0%	18,0%

H1 2021 Core Business Sales

(€ million)	H1 2019A	H1 2020A	H1 2021A
Dixon (Mexico)	19,4	10,6	14,0
DOMS Industries PVT Ltd (India)	35,0	21,2	19,1
Total 3rd Parties Sales	54,4	31,8	33,1

• Adjusted Core Business Sales of 324,7mln €, +5,6% on the same period of the previous year; +11,1% (+34,2mln €) at comparable FX rates of which:

• ‒ By Geographic Area: Europe +22,1mln € (+22,1%), Centre & South America +6,8mln € (+39,8%), North America +4,1mln € (+2,5%), Asia +0,9mln € (+3,4%), Other Countries +0,3mln € (+23,7%);
• ‒ By Product line: School & Office +19,1mln € (+9,4%), Fine Art, Hobby & Digital +12,5mln € (+13,0%), Industrial +2,6mln € (+28,6%).
• ‒ 0,2mln € adjustment in H1 2021 due to customer claims for Covid-19; 0,1mln € adjustment in H1 2020 due to customer claims for Covid-19.

F.I.L.A.- Arches S.A.S. consolidated in FY 2020 since the month of March.

5

H1 2021 Core Business Sales

SALES BY GEOGRAPHICAL AREA

H1 2021 EBITDA Adjusted (Excluded IFRS 16)

Data in millions of euros; for precise data refer to 6M FILA financial report

7

H1 2021 Net Income Adjusted (Excluded IFRS 16)

• Adjusted Net Income of 26,6mln €, +17,1mln € on H1 2020 due to the improvement of the Operating and Financial Results;
• The adjustment of the Group Results in H1 2021 for 2,1mln € mainly refers to extraordinary operating costs for COVID-19 pandemic impact and reorganization - restructuring costs, net of taxes effects;
• The adjustment of the Group Result in H1 2020 for 5,3mln € mainly refers to extraordinary operating costs for Arches acquisition and COVID-19 pandemic impact, net of taxes effects.

H1 2021 Net Bank Debt and NFP

(€ million)	H1 2020A	FY 2020	H1 2021A
Cash and Cash Equivalents	67,2	116,3	74,7
Financial Liabilities	(571,1)	(512,4)	(500,2)
Net Bank Debt	(503,9)	(396,1)	(425,5)
Amortized cost	7,6	6,2	5,0
Financial Receivables	0,3	0,1	0,1
NFP for Covenants	(496,1)	(389,8)	(420,5)
Mark to Market Hedging	(23,8)	(18,8)	(15)
IFRS 16	(91,4)	(84,9)	(88,4)
NFP included IFRS 16 and Financial Instruments	(611,3)	(493,5)	(523,9)

• Net Bank Debt decrease of 78,4mln € in the last twelve months, 67,4mln € excluding positive FX effect of approx. 11,0mln €;
• H1 2021A Net Financial Position increase of 30,4mln € compared to FY2020 (please refer to page 10 for details).

	H1 2020A	H1 2021A
Trade Working Capital	357,2	336,6
Sales Reported Rolling	639,5	624,4
Trade Working Capital/Sales Reported Rolling	55,9%	53,9%

H1 2021 Cash Flow Statement

	(€ million)	H1 2020A	H1 2021A
	CASH FLOW
6	EBIT	21,2	41,6
	Adjustments for non monetary costs	17,5	15,6
	Adjustments for taxes	(1,4)	(2,7)
S 1	Cash-flow from operating activities before changes in NWC	37,3	54,5
R F I	Changes in net working capital	(81,6)	(58,5)
D E	Operating cash-flow	(44,3)	(3,9)
D U	Investments in tangible and intagible assets	(6,1)	(4,8)
CL X E	Free Cash Flow	(50,4)	(8,7)
	Net financial expenses	(10,9)	(9,6)
	Other changes	(1,7)	0,8
	Free Cash Flow to Equity	(62,9)	(17,4)
	Capital increase/reimbursement/dividends	(0,3)	(7,0)
	Adjustment mark to market hedging	(10,2)	3,8
	Effect of FX rate movements*	7,5	(6,2)
	IFRS 16 Net Financial Position	(3,6)	(3,5)
	M&A - Acquisition: 2020 Arches	(43,6)	-
	Changes in Net Financial Position	(113,1)	(30,4)

* Related to Net Bank Debt

Appendix

H1 2021 Income Statement Reported

(€ million) H1 2020A % on Sales H1 2021A % on Sales PROFIT & LOSS Core Business Sales 307,5 324,6 Other revenues 6,0 3,5 Total revenues 313,5 328,1 Cost for Raw Materials and Supplies net Increase(decrease) inventory (142,9) (46,5%) (145,6) (44,9%) Costs for Services and Use of Third-Party Assets (53,0) (17,2%) (49,1) (15,1%) Personnel Costs (66,9) (21,8%) (67,3) (20,7%) Other Operating Costs (5,5) (1,8%) (2,8) (0,9%) Total operating costs (268,3) (87,3%) (264,7) (81,6%) EBITDA 45,2 14,7% 63,3 19,5% Depreciation and Amortization (21,6) (7,0%) (20,2) (6,2%) Write-Downs (1,3) (0,4%) 0,3 0,1% EBIT 22,3 7,3% 43,4 13,4% Financial income/expenses (17,2) (5,6%) (12,2) (3,7%) Income/expenses from associates at equity method (0,1) (0,0%) 0,1 0,0% PBT 5,0 1,6% 31,4 9,7% Taxes (2,9) (0,9%) (7,5) (2,3%) Total net profit (loss) of the period 2,2 0,7% 23,8 7,3% Total net profit (loss) attributable to non controlling interests (0,6) (0,2%) 0,0 0,0% Fila Group's total net profit (loss) of the period 2,8 0,9% 23,8 7,3% *

* Of which: Tangible Assets 7,5mln €; IFRS 16 Tangible Asset 5,6mln €; Intangible Assets 7,1mln € (PPA 5,7mln €)

H1 2021 Income Statement Adjusted

(€ million)	H1 2020A	% on Sales	H1 2021A	% on Sales
P&L ADJUSTMENTS
REPORTED CORE BUSINESS SALES	307,5		324,6
Total Adjustments	0,1		0,2
ADJUSTED CORE BUSINESS SALES	307,6		324,7
REPORTED EBITDA	45,2	14,7%	63,3	19,5%
IFRS 16 Impact	(6,7)		(7,4)
Total Adjustments	7,7		2,6
ADJUSTED EBITDA EXCLUDED IFRS 16	46,2	15,0%	58,5	18,0%
REPORTED FILA GROUP NET PROFIT	2,8	0,9%	23,8	7,3%
IFRS 16 Impact	1,4		0,7
Total Adjustments	5,3		2,1

ADJUSTED FILA GROUP NET PROFIT EXCLUDED IFRS 16 9,5 3,1% 26,6 8,2%

H1 2021 Balance Sheet Reported

Total shares * Ordinary shares only

*Total shares 51.058.297 of which : Ordinary shares 42.976.441 (of which own shares 51.500); Class B shares 8.081.856 (enjoy three votes each in accordance with Article 127-sexies of Legislative Decree No. 58/1998).

**Of which own shares 51.500.

Investor Relations F.I.L.A.
Stefano De Rosa CFO/IR Officer – Francesca Cocco IR
ir@fila.it
(+39) 02 38105206