Fnm — Investor Presentation 2020

Mar 19, 2021

FNM Group FY 2020 RESULTS

March 19, 2021

FNM Group| Overview

1 Companies operating in the freight mobility sector, in the start-up phase, included respectively in the Railway infrastructure management and in Ro.S.Co. & Services segments

2 Companies operating in the road passenger transport but considered in the Ro.S.Co. Segment for the purposes of preparing the financial statements

Economic and financial results

• Financial highlights
• FY 2020 consolidated results
• Shareholders and share performance

Mise acquisition

Outlook

Sustainability

Appendix

FNM Group| FY 2020 Highlights

1 – Adjusted EBITDA: excluding extraordinary gains and losses

2 – Adjusted Net Profit (Loss): Net Profit (Loss) before recognition of the result of companies consolidated using the equity method

FNM Group | Revenues and Adjusted EBITDA by segment

(in mln € )

REVENUES	Il gruppo in breve 2020 FY	2019 FY	D	D %
Railway	126	124	2	8%
infrastructure	9	6	3	1
management	,	,	,	,
Road	94	118	(23	-19
transport	7	3	6)	9%
passenger	,	,	,	,
& Service Ro S Co	84 0 ,	82 6 ,	1 4 ,	7% 1 ,
Intercompany	(24	(24	0	-2
	3)	9)	6	4%
	,	,	,	,
Total	281	300	(19	-6
	3	6	3)	4%
	,	,	,	,

EBITDA1	FY	FY	D	D
ADJUSTED	2020	2019		%
Railway	5	4	1	41
infrastructure	8	1	7	5%
management	,	,	,	,
Road	10	13	(3	-24
transport	0	2	2)	2%
passenger	,	,	,	,
S Co & Service Ro	3 54 ,	52 3 ,	2 0 ,	3 8% ,
Total	70	69	0	0
	1	6	5	7%
	,	,	,	,

	Railway infrastructure management
	Higher proceeds from engineering and project management on financed investments as well as for terminal management
	Lower proceeds from Service Contract due to changes in the number of train services scheduling and from efficiency mechanism
	Road passenger transport Calo dei servizi a seguito della riduzione
	della circolazione Lower services due to reduced demand as a result of the introduction of travel restrictions due Covid-19
	Partial compensation from higher revenues from public contracts and grants thanks to the compensation measures implemented by the Grovernment (restoration of lower ticketing revenues equal to €4.1 mln)
Ro.S.Co.
	Higher fees form the new fleet leased to Trenord and DB Cargo Italia
	Lower advertising revenues; change in perimeter due to sale of Locoitalia in 2020; one off proceeds in 2019

Higher due Road passenger Lower	maintenance costs during the lockdown period and higher costs for terminal management to the activity development Maggiori corse sostitutive Miglioramento redditività E-Vai transport revenues strongly mitigated by cost control measures
Ro.S.Co.

FNM Group| From EBITDA to Net Result

* Adjusted Net Result: Net Result before profit (loss) of companies consolidated at equity

FNM Group| consolidated Cash Flow and Net Financial Position

(in mln € )

FNM Group | Dividend policy

DPS1	0 022 Euro ,
Total Cash Out	mln Euro 9 6 ,
(at 2021) Dividend Yield March 18 ,	3 6% ,
(on Result) Ratio SpA Payout FNM Net	~40%

Economic and financial results

• Financial highlights
• FY 2020 consolidated results
• Shareholders and share performance

Mise acquisition

Outlook

Sustainability

Appendix

FNM Group | The core business: Motorway infrastructure management – MISE acquisition

Business Overview

• On Feb. 26 2021 FNM acquired from Regione Lombardia a 82,6% participation in Milano Serravalle Milano Tangenziali S.p.A. ("MiSe"). FNM now owns 96% of MISE¹ .
• Founded in 1951 in Assago, MiSe is the concessionaire until 2028 of the A7 motorway from Milano to Serravalle Scrivia and of the three Milanese ring roads A50, A51, A52 (West, East, North) for a total of 179 km and ~ 3,115 mln vehicle-km in 2019, in one of the wealthiest areas un Europe.
• MiSe also holds a 36.7% stake² in Autostrada Pedemontana Lombarda S.p.A. ("APL"), which is the concessionaire of ~ 84 km³ toll roads as of 30/06/2018 and which should exceed 157 km³ of overall roads once the project is completed.

Key Financials (ITA GAAP)

mln €	FY 2020	FY 2019
Tolls	167,8	234,8
Other revenues	11,0	14,1
Total revenues	178,8	248,9
EBITDA	73,1	145,8
EBITDA %	41%	59%
EBIT	27,8	88,2
Net Income	4,8	57,8
debt (cash) Net	134,8	125,0
/EBITDA Debt (x) Net	1,8	0,9
CAPEX	50,4	53,6

1) Including the 13.6% stake purchased from ASTM Spa in July 2020; 2) following the €350mln capital increase fully subscribed by Regione Lombardia on Feb. 26 2021, Regione Lombardia owns the remaining 63.3% stake; 3) including junctions and local roads

FNM Group | MISE extension

FNM Group strengthens its positioning in the highest traffic demand areas in the Region

FNM Group | The core business: Motorway infrastructure management – rationale

A transformational deal for FNM

• Creation of a unique integrated infrastructure operator in Italy which will allow:
  • An integrated management of the ever-growing demand for mobility, with optimization of flows, reduction of polluting emissions and development of sustainable mobility
  • A new approach to the offer of transport services through the synergic integration of nodes and networks: from single services to an integrated and converging model
  • System synergies (strategy, planning, management, monitoring and control, innovation and technological know-how)
• Improvement of FNM Group's revenues, enhancing the income profile and providing regulatory risk diversification
• Strengthening of geographical presence in the Lombardy territory and in the areas with higher transportation demand
• Further developments of infrastructures in the Lombardy territory

efficiency

FNM Group | Combined financials of FNM and MISE

Pro forma, unaudited 2020 results – IFRS/IAS compliant

mln €	consolidated stand alone FNM	stand alone MISE	Combined FNM - MISE (unaudited forma) - pro
Revenues	281 3 ,	200 3 ,	481 6 ,
EBITDA* Adj	70 1 ,	79 7 ,	147 0 ,
EBITDA margin	25%	40%	31%
EBIT	26 4 ,	25 2 ,	54 4 ,
profit (loss) Net	24 7 ,	6 15 ,	23 7 ,
Adj financial position Net	40 2 ,	140 9 ,	707 1 ,
(x) NFP/ Adj Adj EBITDA	0 6 ,	1 8 ,	4 8 ,

Evolution of EBITDA composition and business risk diversification

Economic and financial results

• Financial highlights
• FY 2020 consolidated results
• Shareholders and share performance

Mise acquisition

Outlook

Sustainability

Appendix

FNM Group| COVID-19 IMPACTS ON FY2021 OUTLOOK

FNM Group| OUTLOOK FY 2021

Economic and financial results

• Financial highlights
• FY 2020 consolidated results
• Shareholders and share performance

Mise acquisition

Outlook

Sustainability

Appendix

FNM Group | Sustainabilty strategy

Integrated sustainable mobility operator, able to read reality, investigating the "why" and "how" people, cities and companies move, to anticipate and offer the best solutions in terms of new mobility models

VISION

Improve the lives of people, cities and businesses, by developing connections and responding to mobility needs

MISSION

Develop an integrated platform of mobility services, built to meet criteria of environmental and economic sustainability, which rationalizes and connects (physically and digitally) urban nodes, destinations and transport networks, to create social value and promote the productivity of the territory

VALUES

In all its business activities, the Group operates in full consistency with the principles of Responsibility, Integrity, Transparency, Efficiency, Merit and Sustainability

FNM Group | Sustainabilty governance

The FNM Group has developed its own Governance system to promote the integration of Sustainability issues in the definition of business processes in all business areas and ensure compliance with current legislation through:

With the approval of the guidelines of the 2021-2025 Business Plan by FNM BoD on November 25, 2020, for the first time ESG principles become the driver of the Group's strategy, providing an integrated strategic vision to run the business sustainably.

FNM Group | The pillars and enablers of FNM strategic vision

ENABLERS
Innovation and data		Governance, ethics and		Attraction, enhancement and		Energy efficiency and emissions
management		sustainability culture		well-being of employees		reduction

FNM Group| A BUSINESS MODEL INTEGRATED WITH SUSTAINABILITY

FNM Business Model

FNM Group's value creation is represented by the business model that integrates the principles of sustainability within the corporate strategy. Resources are defined as capitals, i.e. stocks of value that are increased, reduced or transformed by the organization's activity and outputs. Each capital contributes, in line with the guidelines of the Strategic Plan, to the achievement of the Sustainable Development Goals (SDGs).

FNM Group| FNM CREATION OFSHARED VALUE

The value created by the FNM Group: capitals

Capital	Description	Highlights
Financial	Economic resources involved in production processes	• The Economic Value Generated by the Group amounts to € 320.9 million, of which € 254.8 million distributed to stakeholders • 52.4% of the distributed economic value is destined to suppliers, 44.5% to employees and 2.1% to the Public Administration • 70% of the tender procedures launched in 2020 are subject to compliance with the ESG criteria
Production and intellectual	Real estate, infrastructure and physical equipment used in the production of the services offered by the company, plus all intangible assets represented by the Group's organizational expertise and intellectual property	· The Group continued its commitment to the expansion and renewal of the fleet with an investment of approximately € 32.5 million • The fleet for local public transport is composed of 711 buses • The car sharing car fleet is made up of 242 vehicles of which 229 are electric
Human	The skills, expertise and experience of the people who work at the company	· Training hours provided: 35,425 • Total workforce: 2,265 • 40% of Group companies are ISO 45001-certified (Occupational Health and Safety Management System)
Natura	All processes and environmental resources which contribute to the delivery of the services offered by the company	• The FNM Group reduced emissions from electricity consumption by 37% compared to the previous year · From 2021, 30% of electricity coming from renewable sources • 80% of the waste produced by FERROVIENORD (ferrous material) is destined to recovery
Social and relational	The ability of the company to create relationships with external stakeholders and to share value in order to increase individual and collective wellbeing	• 3 partnerships to contribute to the SDGs • Events dedicated to Sustainable Mobility and LPT: 11 · Awareness campaign to prevent the spread of Covid-19 at station

FNM Group| FNM TRUE VALUE

Impacts of the FNM Group

The direct and indirect impacts of FNM considered in the True Value model are shown below

FNM Group| FNM TRUE VALUE

The value of the FNM Group activity

FNM Group's True Value Bridge in 2020

The True Value attributable to the total impacts of the FNM Group amounts to around

€ 2 billion of which about 65% is generated by economic impacts.

True Value is a KPMG methodology that measures the "real" value created by an organization, identifying and quantifying its economic, social and environmental externalities.

Economic and financial results

Mise acquisition

Outlook

Sustainability

Appendix

• Shareholders and share performance
• Consolidated Profit and Loss
• Revenues breakdown segment details
• Profit (loss) of companies consolidated at equity
• Consolidated balance Sheet
• NetFinancial Position composition
• Sustanability

FNM Group| Shareholders and share performance

Relative performance Jan. 1, 2020 to date, vs reference indexes

Regione Lombardia Ferrovie dello Stato Market

FNM Group| Consolidated Profit & Loss

(€M)	FY 2020	FY 2019	Var	Var %
from sales and Revenues services	258 8 ,	279 2 ,	Il gruppo in breve (20 4) ,	-7 3% ,
Other and income revenues	22 5 ,	21 4 ,	1 1 ,	1% 5 ,
Total and other income revenues	281 3 ,	300 6 ,	(19 3) ,	-6 4% ,
Operating costs	(97 7) ,	(105 5) ,	7 8 ,	-7 4% ,
Personnel costs	(113 5) ,	(125 5) ,	12 0 ,	-9 6% ,
ADJ EBITDA	70 1 ,	69 6 ,	0 5 ,	0 7% ,
Non-ordinary (expense) income	(1 9) ,	1 4 ,	(3 3) ,	n m
EBITDA	68 2 ,	71 0 ,	(2 8) ,	-3 9% ,
and Depreciation amortisation	(41 8) ,	(40 7) ,	(1 1) ,	2 7% ,
EBIT	26 4 ,	30 3 ,	(3 9) ,	-12 9% ,
financial (expense) income Net	(0 1) ,	(2 4) ,	2 3 ,	n m
of which divestments gains on	1 0 ,	0 0 ,	1 0 ,	n m
EARNINGS BEFORE TAXES	26 3 ,	27 9 ,	(1 6) ,	-5 7% ,
Income taxes	(3 6) ,	(5 0) ,	1 4 ,	-28 0% ,
(LOSS) ADJUSTED NET PROFIT	22 7 ,	22 9 ,	(0 2) ,	9% -0 ,
Profit (Loss) of consolidated companies equity at	2 0 ,	8 0 ,	(6 0) ,	n m
Profit (Loss) Net	24 7 ,	30 9 ,	(6 2) ,	-20 1% ,
(Loss) Profit Minority interest in Net	0 5 ,	0 6 ,	(0 1) ,	-16 7% ,
Profit (Loss) Group Net	24 2 ,	30 3 ,	(6 1) ,	1% -20 ,

FNM Group| Consolidated Profit & Loss – segment details

E-MARKET SDIR
CERTIFIED

Railway infrastructure management

(€M)	FY 2020	FY 2019	Var.	Var.%
Public contracts and grants	100,5	99,6	0,9	0,9%
Rolling stock leasing	9,3	8,5	0,8	9,4%
Other revenues	17,1	16,5	0,6	3,6%
Total revenues	126,9	124,6	2,3	1,8%
Adj. EBITDA	5,8	4,1	1,7	41,5%
Adj. EBITDA/Revenues %	4,6%	3,3%
EBIT	3,6	4,4	(0,8)	-18,2%

Road transport

(€M)	FY 2020	FY 2019	Var	Var %
Public and contracts grants	47 6 ,	46 4 ,	1 2 ,	6% 2 ,
services Transport	35 3 ,	62 3 ,	(27 0) ,	-43 3% ,
Other revenues	11 8 ,	9 6 ,	2 2 ,	22 9% ,
Total revenues	94 7 ,	118 3 ,	(23 6) ,	9% -19 ,
Adj EBITDA	10 0 ,	13 2 ,	(3 2) ,	2% -24 ,
EBITDA/Revenues Adj %	10 6% ,	2% 11 ,
EBIT	(1 7) ,	1 7 ,	(3 4) ,	nm

(€M)	FY 2020	FY 2019	Var	Var %
Rolling stock leasing	56 9 ,	8 55 ,	1 1 ,	2 0% ,
Other revenues	27 1 ,	26 8 ,	0 3 ,	1 1% ,
Total revenues	84 0 ,	82 6 ,	1 4 ,	7% 1 ,
Adj . EBITDA	54 3 ,	52 3 ,	2 0 ,	3 8% ,
EBITDA/Revenues Adj %	64 6% ,	63 3% ,
EBIT	24 4 ,	24 2 ,	0 2 ,	0 8% ,

Partial compensation from higher revenues from public contracts and grants thanks to the compensation measures implemented by the Grovernment (restoration of lower ticketing revenues equal to €4.1 mln)

FNM Group| Profit (loss) of companies consolidated at equity

(€ '000)	FY 2020	FY 2019	Var	Il gruppo in breve Var %
Srl1 Trenord	(3 796)	1 598	(5 394)	n m
Spa2 Nord Energia	2 567	3 377	(810)	-24%
Italia Srl Cargo DB	1 813	1 722	91	5%
Srl3 Omnibus Partecipazioni	1 052	1 192	(140)	-12%
NordCom Spa	283	460	(177)	-38%
Srl Conam	44	55	(11)	-20%
Srl liquidazione SeM S in	81	34	47	nm
Srl4 Fuorimuro	0	(391)	391	n m
Profit (Loss) of consolidated companies equity at	2 044	8 047	(6 003)	nm

• 1 including the profit (loss) of TILO SA
• 2 including the profit (loss) of CMC MeSta SA
• 3 including the profit (loss) of ASF Autolinee Srl
• 4 the result of the investment in Fuorimuro was equal to zero as a result of the sale on
• March 10 2020, adjusted to fair value on December 31, 2019

FNM Group| Consolidated Balance Sheet

(€M)	'20 Dec 31 ,	'19 Dec 31 ,	Var
Inventories	8 7 ,	8 9 ,	(0 2) ,
Trade receivables	82 6 ,	64 6 ,	18 0 ,
Other receivables current	99 0 ,	60 9 ,	38 1 ,
payables Trade	(177 5) ,	(175 7) ,	(1 8) ,
Other payables and provisions current current	(70 7) ,	(91 0) ,	20 3 ,
Working Capital Net	(57 9) ,	(132 3) ,	74 4 ,
Fixed assets	468 3 ,	432 3 ,	36 0 ,
Equity interests	168 0 ,	84 9 ,	83 1 ,
receivables Non-current	24 2 ,	21 6 ,	2 6 ,
liabilities Non-current	(24 4) ,	(28 2) ,	3 8 ,
Provisions	(60 9) ,	(60 9) ,	0 0 ,
and liabilities held for sale Assets	0 0 ,	29 5 ,	(29 5) ,
NET INVESTED CAPITAL	517 3 ,	346 9 ,	170 4 ,
Equity	477 1	454 3	22 8
(Debt/ Adjusted Financial -Cash) Net Position	, 43 7 ,	, (39 9) ,	, 83 6 ,
Financial for funded (cash) Position investments Net	(3 5) ,	(67 5) ,	64 0 ,
(Debt/ -Cash) Financial Position Net	40 2 ,	(107 4) ,	147 6 ,
TOTAL SOURCES	517 3 ,	346 9 ,	170 4 ,

Of wich on December 31, 2020:

• Trains 334 mln euros

• Buses: 35 mln euros

Il gruppo in breve

FNM Group| Consolidated Balance Sheet – NFP composition

(€M)	'20 Dec 31 ,	'19 Dec 31 ,	Var
Cash and bank deposits	(126 1) ,	(156 4) ,	30 3 ,
financial receivables Current	(0 1) ,	(49 3) ,	49 2 ,
financial debt Current	101 2 ,	94 3 ,	6 9 ,
(Debt/ Financial -Cash) Position Current Net	(25 0) ,	(111 4) ,	86 4 ,
financial debt Non-current	68 7 ,	71 5 ,	(2 8) ,
(Debt/ -Cash) Adjusted Financial Position Net	43 7 ,	(39 9) ,	83 6 ,
(Debt/ -Cash) Financial for funded Net Position investments	(3 5) ,	(67 5) ,	64 0 ,
(Debt/ Financial -Cash) Net Position	40 2 ,	(107 4) ,	147 6 ,

FNM Group| Main features of the Sustainability Report 2020

Overview

The main new elements of the Sustainability Report 2020 are: The main new elements of the Sustainability Report 2020 are: The main new elements of the Sustainability Report 2020 are:

Review of the main material topics and the Group's materiality matrix Review of the main material topics and the Group's materiality matrix

Group's business model update Group's business model update Group's business model update

Dedicated chapter to the impacts of the Coronavirus pandemic Dedicated chapter to the impacts of the Coronavirus pandemic Dedicated chapter to the impacts of the Coronavirus pandemic

Integration of information requested by investors and rating agencies Integration of information requested by investors and rating agencies Integration of information requested by investors and rating agencies

Quantification of the generated economic, environmental and social impacts Quantification of the generated economic, environmental and socia Quantification of the generated economic, environmental and social impacts

Reference regulations and methodological standards

The Consolidated Disclosure of Non-Financial Information has been written in compliance with the provisions of the following regulations and methodological standards: The Consolidated Disclosure of Non-Financial Information has been written in compliance with the provisions of the following regulations and methodological standards: The Consolidated Disclosure of Non-Financial Information has been written in compliance with the provisions of the following regulations and methodological standards:

FNM Group| Sustainability Report Contents

Document Index

	President's Letter to the stakeholders and Vice President's Introduction
Methodological note			- Reporting scope; reporting principles, criteria and standards	INTRODUCTION
Reader's guide			Introductory note to the document
	FNM Group: identity		- Description of the mission, profile and activities carried out by the organization
	The impacts generated by the pandemic on the transport market		- Description of the external context in which the organization operates	PROFILE
			Description of the issues that most reflect the environmental, social and economic impacts for the Group
	FNM Group's strategy: an integrated approach and business model		Description of how the organization generates results that aim to achieve strategic goals and create value over time
Sustainability Report 2020	Group's governance model		Description of the governance structure and how it supports the organization in creating value in the short, medium and long term	STRATEGY AND GOVERNANCE
	Risk management system		Description of the risks and opportunities that impact the ability to create value in the short, medium and long term and the ways in which these risks and opportunities are managed
	FNM Group's shared value		Description of financial capital, productive and intellectual capital, human capital, natural capital and social and relational capital
	The creation of value for the country		Measurement of the economic, social and environmental value generated by the FNM Group through the True Value model	CREATED VALUE
Performance's foreseeable evolution			Description of the challenges and uncertainties that the organization may face in pursuing its strategy and their potential impacts on the business model	OTHER
Attachments			Description of the ways in which the organization has determined the issues to be included in the financial statements and the ways in which these issues are quantified and assessed

FNM Group| Materiality matrix 2020

The Top Management and Stakeholders' perspective on FNM Sustainability

Contacts

Valeria Minazzi

Head of Investor Relations Fixed line: +39 02 8511 4302

valeria.Minazzi@fnmgroup.it investor.relations@fnmgroup.it