Piquadro — Earnings Release 2021

Feb 11, 2021

Informazione Regolamentata n. 0955-16-2021		Data/Ora Ricezione 11 Febbraio 2021 15:10:44	MTA
Societa'	:	PIQUADRO
Identificativo Informazione Regolamentata	:	142424
Nome utilizzatore	:	PIQUADRON01 - Trotta
Tipologia	:	REGEM
Data/Ora Ricezione	:	11 Febbraio 2021 15:10:44
Data/Ora Inizio Diffusione presunta	:	11 Febbraio 2021 15:10:45
Oggetto	:	Piquadro S.p.A. The BoD discloses the the NFP as of 31/12/2020	Conso Revenues for Q3 20/21 , the Conso Revenues for the first 9 months 20/21 and
Testo del comunicato

Vedi allegato.

Press Release

Piquadro S.p.A.

The Board of Directors discloses the Consolidated Revenues for the third quarter of FY 2020/21 (October – December 2020), the Consolidated Revenues for the first nine months of Financial Year 2020/2021 and the Net Financial Position as of December 31, 2020.

• Consolidated sales for the third quarter of FY 2020/21 (October December 2020): € 33.5 million (- 23.8% versus the same period last year);
• Consolidated sales for the first nine months of Financial Year 2020/2021: € 82.1 million (- 32.6% versus the same period last year);
• Net financial position adjusted¹ as of December 31, 2020: positive and equal to ca. € 5.0 million (compared to € 9.0 million positive net financial position adjusted on 31 December 2019).
• Net financial position as of December 31, 2020: negative and equal to € 43.1 million including financial payables due to impact of adoption of IFRS 16.

Silla di Gaggio Montano (BO), February 11, 2021. The Board of Directors of Piquadro S.p.A. company that designs, produces, and markets leather goods, today examined, and approved the principal consolidated performance indicators for the third quarter ended 31 December 2020, particularly the sales data for the third quarter of FY 2020/21 (October – December 2020) and net financial position of the Piquadro Group as of December 2020.

Revenues of the third quarter of FY 2020-2021 (October – December 2020 – Q3) by brand
Brand	Net Revenues Q3 2020	%	Net Revenues Q3 2019	%	Chg. % 20 vs 19
(in € thousands)
PIQUADRO	11,073	33.0%	18,367	41.8%	(39.7)%
THE BRIDGE	5,814	17.3%	8,107	18.4%	(28.3)%
LANCEL	16,627	49.6%	17,483	39.8%	(4.9)%
Total	33,514	100.0%	43,957	100.0%	(23.8)%

The consolidated turnover recorded by the Piquadro Group in the third quarter of the fiscal year 2020/21 is equal to € 33.5 million, with a decrease of 23.8% compared to the same period of the previous year closed at 44.0 million Euro. The sales results for the period are severely affected by the measures introduced by public and government authorities worldwide to mitigate the spread of the "Covid-19" virus. This quarter underwent the temporary closure of the distribution network together with the prohibition and / or limitation on the mobility of people and goods.

With reference to the Piquadro brand, the revenues recorded in the third quarter of FY 2020/21 (October – December 2020) amount to € 11.1 million, with a 39.7% drop compared to the same

¹ With the introduction of the new accounting standard IFRS 16, starting from April 1st, 2019, a new accounting treatment of leases is introduced, which generates a significant effect on EBITDA, EBIT, net invested capital, net financial position, and cash flow generated from operational activity. For this reason, in this press release the "adjusted" balances of the amounts are also reported to make the figures for December 31st, 2020 comparable with those of previous periods.

period of the previous fiscal year; that decrease particularly affected the retail channel penalized by the closure of the brand's distribution network, direct and wholesale stores, as well as by the lack of traffic. The e-commerce channel, on the other hand, recorded a 20.1% increase compared to the same period of previous fiscal year.

With reference to The Bridge, the revenues recorded in the third quarter of FY 2020/21 (October – December 2020) amounted to € 5.8 million, with a 28.3% drop compared to the same period of the previous year; that decrease was impacted by the closings of the shops, direct and wholesale stores, as well as by the lack of tourist flows in the period.

The e-commerce channel, on the other hand, recorded a 118.6% rise compared to the same period of previous fiscal year.

The sales revenues achieved by the Lancel Maison in the third quarter of FY 2020/21 (October – December 2020) amounted to € 16.7 million, with a decrease of 4.9% compared to the same period of the previous fiscal year; that decrease was impacted by the temporary closings of the shops in the period, especially those located in France during the month of November.

The e-commerce channel, on the other hand, recorded a 176.0% growth compared to the same period of the previous fiscal year.

					Revenues of the third quarter of FY 2020/2021 (October – December 2020 – Q3) by
geographical area

Geographic Area	Net Revenues Q3	%	Net Revenues Q3	%	Chg. % 20 vs 19
(in € thousands)	2020		2019
Italy	11,618	34.7%	20,389	46.4%	(43,0)%
Europe	19,991	59.7%	22,388	50.9%	(10,7)%
Rest of the world	1,905	5.7%	1,180	2.7%	61,3%
Total	33,514	100.0%	43,957	100.0%	(23,8)%

From a geographical standpoint, Piquadro Group sales in Italy amounted to € 11.6 million, in the third quarter of FY 2020/21 (October – December 2020), 34.7% of the Group total (46.4% of consolidated sales of the same period of previous fiscal year) with a 43.0% decrease over the same period of FY 2019-2020.

In the European market, the Group registered sales of € 20.0 million, equal to 59.7% of consolidated sales (50.9% of consolidated sales of the same period of previous fiscal year) 10.7% less than in the same period of FY 2019-2020.

In the extra-European geographical area (called "Rest of the world"), the group recorded sales of € 1.9 million, equal to 5.7% of consolidated sales (2.7% of consolidated sales of the same period of previous fiscal year) with a 61,3% rise over the same period of FY 2019-2020.

Revenues of the first nine months of FY 2020-2021 (by brand)

Brand (in € thousands)	Net Revenues December 31, 2020	%	Net Revenues December 31, 2019	%	Chg. % 20 vs 19
PIQUADRO	33,445	40.8%	56,661	46.5%	(41.0)%
THE BRIDGE	14,128	17.2%	22,393	17.4%	(36.9)%
LANCEL	34,495	42.0%	42,761	36.1%	(19.3).%
Total	82,068	100.0%	121,815	100.0%	(32.6)%

The consolidated turnover recorded by the Piquadro Group in the first nine months of the year ended on December 31, 2020 is equal to € 82.1 million, with a 32.6% decrease compared to the same period of the previous year closed at € 121.8 million. The sales results for the period are severely affected by the measures introduced by public and government authorities worldwide to curb the spread of the "Covid-19" virus. In particular, the first quarter underwent the temporary closure of over 90% of the distribution network for about two months together with the prohibition and / or limitation on the mobility and movement of people and goods as well as the closure of commercial activities and sales to the public (so-called lockdown), severely impacting, among other things, on tourist flows all over the world.

With reference to the Piquadro brand, the revenues recorded in the first nine months amount to € 33.4 million, with a 41.0% drop compared to the same period ended on 31 December 2019; that decrease particularly affected the retail channel penalized by the closure of the brand's distribution network and by the lack of traffic.

The e-commerce channel, on the other hand, recorded a 21.8% increase, compared to the same period ended on December 31, 2019.

With reference to The Bridge the revenues recorded in the first nine months of the year amounted to € 14.1 million, with a 36.9% drop, compared to the same period ended on 31 December 2019; that decrease was strongly impacted by the closings of the shops and by the absence of tourist flows in the period.

The e-commerce channel, on the other hand, recorded an 77.2% rise, compared to the same period ended on December 31, 2019.

The sales revenues achieved by the Lancel Maison in the first nine months of the year amounted to € 34.5 million, with a 19.3% drop compared to the same period ended on 31 December 2019; that decrease was due by the closings of the shops in the period.

The e-commerce channel, on the other hand, recorded an 133.6% increase, compared to the same period ended on 31 December 2019.

Geographic Area	Net Revenues		Net Revenues		Chg. % 20 vs 19
(in € thousands)	December 31, 2020	%	December 31, 2019	%
Italy	36,001	43.8%	61,248	50.3%	(41,2)%
Europe	42,412	51.7%	57,323	47.0%	(26,0)%
Rest of the world	3,655	4.5%	3,244	2.7%	12,6%
Total	82,068	100.0%	121,815	100.0%	(32,6)%

Revenues of the first nine months of FY 2020/2021 (by geographical area)

From a geographical standpoint, Piquadro group sales in Italy, amounted to € 36.0 million, in the first nine months, and they stand at 43.8% of the Group's total (50.3% of consolidated sales to 31 December 2019) with a 41.2% decrease over the same period of FY 2019-2020.

In the European market, the Group registered sales of € 42.4 million, equal to 51.7% of consolidated sales (47.0% of consolidated sales to 31 December 2019), 26.0% less than in the same period of FY 2019-2020.

In the extra-European geographical area (called "Rest of the world"), the group recorded sales of € 3.7 million, equal to 4.5% of consolidated sales (2.7% of consolidated sales to 31 December 2019) with a 12,6% increase over the same period of FY 2019-2020.

Net Financial Position (in million Euro)	31 December 2020 IFRS 16	31 December 2020 (adjusted)	31 March 2020 IFRS16	31 March 2020 (adjusted)	31 December 2019 IFRS 16	31 December 2019 (adjusted)
(A) Cash	348	348	202	202	332	332
(B) Other cash and cash equivalents (available current bank accounts)	49,905	49,905	57,348	57,348	38,084	38,084
(C) Liquidity (A) + (B)	50,253	50,253	57,550	57,550	38,417	38,417
(D) Finance leases (E) Current portion of non	(13,456) (13,069)	0 (13,069)	(14,365) (15,450)	0 (15,450)	(15,807) (11,987)	0 (11,987)
current debt (F) Payables to Il Ponte S,p,A., for the acquisition of The Bridge	(70)	(70)	(70)	(70)	(70)	(70)
(G) Current financial debt (D) + (E) + (F)	(26,595)	(13,139)	(29,885)	(15,520)	(27,864)	(12,057)
(H) Short-term net financial position (C) + (G)	23,658	37,115	27,665	42,030	10,553	26,360
(I) Non-current bank debt (L) Payables to	(28,066)	(28,066)	(20,501)	(20,501)	(12,815)	(12,815)
Richemont Group for the acquisition of Lancel	(3,341)	(3,341)	(3,341)	(3,341)	(3,869)	(3,869)
(M) Finance leases	(34,730)	0	(39,243)	0	(44,637)	0
(N) Payables to The Ponte S,p,A, for the acquisition of The Bridge	(662)	(662)	(662)	(662)	(1,293)	(1,293)
(O) Non-current financial debt (I) + (L) + (M)+(N)	(66,799)	(32,069)	(63,747)	(24,504)	(61,984)	(17,347)
(P) Net Financial Position (H) + (O)	(43,141)	5,045	(36,082)	17,526	(51,431)	9,013

The Net Financial Position of the Piquadro Group, recorded as of December 31, 2020 was negative and equal to € 43.1 million with an 8.0 million improvement versus the Net Financial Position recorded on December 31, 2019 and it now stands at € 36.1 million. The impact of the application of the new accounting standard IFRS 16 was equal to approximately € 48.1 million with a minus sign (the impact of the application of the new accounting standard IFRS 16 for the Net Financial Position recorded on December 31, 2019 was approximately € 60.4 million).

The Net Financial Position adjusted¹ of the Piquadro Group, was positive and equal to approximately € 5.0 million, compared to Net Financial Position adjusted¹ figure of approximately € 9.0 million recorded on December 31, 2019. The dynamics of the adjusted Net Financial Position was severely impacted by the measures introduced by public and government authorities to curb the spread of the "Covid-19" virus. The temporary closure of almost all direct and wholesale stores at the beginning of the FY 2020/21 over the months of April and May and later during partial lockdowns in different countries and regions had a simultaneous effect on incoming cash flows.

The "Covid-19" pandemic that started to spread in Asia in January 2020 and later, in February and March 2020, in Europe and America was the cause of restriction measures introduced by worldwide public and government authorities to contain the spread of the virus with a very serious impact on the personal and professional lives of people and companies.

The urgent regulatory interventions entailed, among other things, the prohibition and / or limitation on the mobility and movement of people and goods and the closure of commercial and sales activities to the public (so-called lockdown), as well as limitations on industrial and production activities, impacting in an exceptionally negative way on tourist flows all over the world and, consequently, on the market trend, causing the closure of most of the distribution network of the Piquadro Group.

To date, the sanitary emergency has not yet been resolved globally and a second wave of infections is now hitting hard various areas of the world especially Europe and the United States. In particular, the affected countries were forced to reintroduce containment measures, previously eliminated with the arrival of summer.

Therefore, the current scenario continues to be characterized by great uncertainty related to the future potential developments of the pandemic itself and its effects on the economic system.

As announced, since the beginning of the sanitary emergency, the Piquadro Group immediately faced this new and difficult scenario, complying with all the requirements set by the Italian government and by the governments and public authorities of the countries in which it operates. Exceptional measures were taken to guarantee maximum protection on the health of the Group's employees and collaborators, as well as on its own image. Among those measures there were remote work, social distancing, the adoption of personal protective equipment and sanitation procedures of the premises. All that allowed operational continuity within the limits of the extraordinary legal constraints imposed in the various jurisdictions.

It should be noted that on 13 October and 20 October 2020 additional Prime Minister's Decrees were enacted in view of the evolution of the epidemiological emergency, the particularly widespread nature of the pandemic and the increase in cases at local level, which confirmed the measures that were already in force and provided for new guidelines. Among these are a scheme of closures differentiated according to the range of risk of Coronavirus infection to which each Region belongs, creating an impact on the movement of people and prohibiting any movement in and out of the relevant territory, as well as the suspension of all retail business activities or the mandatory closure of medium and large-sized sales facilities on holidays and days before holidays.

In France, a country in which more than 37% of the Piquadro Group's turnover is currently generated, further containment measures were reintroduced from October to December 2021, to prohibit and / or limit the mobility and movement of people and goods and to close commercial activities and sales to the public.

The consolidated turnover figures as of 31 December 2020, show a serious drop to a very large extent due to the measures introduced by public and government authorities to curb the spread of the "Covid-19" virus and the overall macroeconomic situation remains significantly uncertain depending on the evolution of the pandemic in the coming months and the consequent reaction of demand in a recessionary context. Therefore, the Piquadro Group is focusing on its strengths and, thanks to the work done and the investments made in the recent years, the management keeps a positive attitude towards future developments and is convinced that the Group will quickly resume its path.

"The acceleration in digitization that we have been pursuing for months is reflected in the results of e-commerce, and especially of Lancel and The Bridge that respectively posted growth of 176% and 118% in the last quarter. As a business and travel product brand, Piquadro on the other hand was

more strongly affected by the pandemic and the different lifestyles that restrict travel and that further smart working" comments Marco Palmieri, Chairman and CEO of the Piquadro group, "The performance of the Lancel brand is giving us satisfaction. Also, by virtue of the recent openings on the Asian market, it is showing signs of evident recovery in the third quarter, which ended with a smaller drop in revenue, 4.9%, as compared to 19.3% in the first nine month."

The manager responsible for preparing the Piquadro S,p,A,'s, financial reports, Roberto Trotta, declares – pursuant to paragraph 2 of Article 154-bisof Italy's Legislative Decree 58/1998 – that the accounting information contained in this press release, corresponds to the documented results, books, and accounting records.

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Summary of Economic-financial data and interpretation of alternative performance indicators (Iap)

The Piquadro Group uses the Alternative Performance Indicators (Iap) to effectively transmit information regarding the performance of the profitability of the business in which it operates and to determine its precise asset and financial position. In accordance with the guidelines published on the 5th of October 2015, by the European Securities and Markets Authority (Esma / 2015/1415), and in line with the provisions of the Consob Communication No. 92543 listed on the 3rd of December 2015, the Group provides content and the criterion to determine the Iap used in these financial statements.

• The Net Financial Position ("NFP") is used as a financial indicator for debt and is represented as a sum of the following positive and negative components of the financial balance sheet, as required by CONSOB Communication no. 6064293 of 28 July 2006. Positive components: cash and cash equivalents, securities that can be quickly liquidated from current assets, short-term financial receivables. Negative components: debts to banks, payables to other lenders, leasing and factoring companies.

• The adjusted Net Financial Position ("adjusted NFP") is defined as the Net Financial Position net of the impacts deriving from the application of IFRS 16.

Piquadro Group

The Piquadro Group operates in the sector of leather accessories through the Piquadro, The Bridge and Lancel brands. Cornerstones for the three brands is attention to details and the quality of the workmanship as well as the leather but the Piquadro product stands out for its innovative design and technological content, while The Bridge emphasizes the vintage flavor of Tuscan craftsmanship and finally the Lancel collections embody the Parisian allure of a fashion house founded in 1876.The origins of the Group date back to 1987 when Marco Palmieri, now President and Chief Executive Officer, founded his company near Bologna, where it is still headquartered. The distribution network extends over 50 countries around the world and counts 177 outlets including 85 Piquadro boutiques (55 in Italy and 30 abroad including 47 DOS directly operated stores and 38 franchised stores), 12 The Bridge boutiques (12 in Italy including 10 DOS directly operated stores and 2 franchised) and 80 Lancel boutiques (61 in France and 19 abroad, of which 72 DOS directly operated stores and 8 franchised).

The Group's consolidated turnover for the year 2019/2020 ended on March 31, 2020 is € 152.2 million.

Piquadro S.p.A. has been listed on the Italian Stock Exchange since October 2007.

Piquadro S,p,A., Piquadro S,p,A., Media Relations Investor relationship Paola Di Giuseppe Roberto Trotta Tel +39 02 37052501 Tel +39 0534 409001 paoladigiuseppe@piquadro,com investor,relator@piquadro,com