Poste Italiane — Interim / Quarterly Report 2017

May 10, 2017

Investor Relations

(€m)

Key Numbers

	1Q 2016	1Q 2017	Var %
Revenues	9,759	9,539	-2%
EBIT	562	526	-6%
Net Profit	367	351	-4%

1Q 2017: FIGURES HIGHLIGHTS

1. Net of intersegment revenues

2. Including other segments (Poste Mobile and 'Consorzio Telefonia Mobile')

TOTAL ASSETS UNDER MANAGEMENT/ADMINISTRATION

FOCUS ON FINANCIAL SERVICES (1/3) REVENUES EVOLUTION

(€m)

1. Current accounts/Active Portfolio Management includes interests income, realized capital gain and income from financial assets at FVTPL (Fair Value through profit or loss)

2. Transaction banking includes: payment slips, F24, money transfers, pension cheques and other revenues from current accounts. Net of intercompany values

FOCUS ON FINANCIAL SERVICES (2/3) REVENUES BREAKDOWN

(€m)		1Q 2017 1Q 17 vs 1Q 16 (var.%)	Rationale
	Return on Current Account Deposits	763 -0.4%	Substantially stable. Lower interest income compensated by higher capital gains
	Fees from Postal Savings Collection	355 -12.8%	Lower fees related to lower postal savings average collection and lower recognized commercial costs
	Fees from Transaction Banking	249 -2.8%	Reduction mostly attributable to lower revenues from payments slips and tax return forms
	Distribution Fees	82 +13.3%	Increase mainly due to a better performance on personal loans
	Distribution Fees Payment Card Fees Payment Card Fees	68 +26.1%	Higher revenues both from Postepay, above-all Postepay Evolution

	Total Revenues	1,518 -2.4%
--	----------------	----------------

FOCUS ON FINANCIAL SERVICES (3/3) ACTIVE PORTFOLIO MANAGEMENT

(€m)

AVERAGE DEPOSITS1 ACTIVE PORTFOLIO MANAGEMENT2

• 1. Including current accounts, time deposits and repurchase agreements
• 1. Including interest income and realized capital gains
• 1. Average yield calculated as interest income and realized capital gains pro rata temporis on total financial assets

Avg deposits from Retail and Corporate customers

Entirely invested in Italian Government bonds

BANCOPOSTA REGULATORY FRAMEWORK AND CAPITAL POSITION

Key regulatory constraints /standards: 8% min. CET1 ratio1 / 3% min. leverage ratio

Leverage ratio @ 3.0%, at the minimum regolatory level

ROE2 @ 32% (vs. 29% in FY16)

1. 10.50% Min. CET1 ratio required to distribute earnings (9.25% from 1st January 2017)

2. ROE defined as net earnings/CET 1 capital (excluding valuation reserves)

FOCUS ON INSURANCE & ASSET MANAGEMENT

GROUP GWP AND TECHNICAL RESERVES EVOLUTION

1. Including non-life technical reserves and net of re-insurance reserves

FOCUS ON MAIL & PARCELS (1/2) VOLUMES AND MARKET REVENUES EVOLUTION

Revenues - Mail & Parcels (€m)

FOCUS ON MAIL & PARCELS (2/2) TOTAL REVENUES AND COST STRUCTURE

Total Revenues Operating Costs (€m) 936 914 1.352 1.334 2,288 2,248 1Q 2016 1Q 2017 Market Revenues Infrasegement Revenues -1.7% -1.3% -2.4%

TOTAL GROUP OPERATING COSTS EVOLUTION

Group Operating Costs

COST STRUCTURE AT CONSOLIDATED LEVEL FOCUS ON LABOUR COSTS

GROUP CAPITAL EXPENDITURES

84% 84% 12% 11% 4% 5% 1Q 2016 1Q 2017 Capex evolution (€m) Capex Breakdown by Division (%) 100% 62 81 1Q 2016 1Q 2017 100%

IT Real Estate Other

INDUSTRIAL NET FINANCIAL POSITION

STRONG FOCUS ON

Commitment on future dividend policy

APPENDIX

€m	1Q 2016	1Q 2017	Var.%
Revenue from sales and services	2,161	2,095	(3.1%)
Insurance premium revenue	6,116	5,916	(3.3%)
Other income from financial and insurance activities	1,467	1,513	3.1%
Other operating income	15	15	n.m.
Sales	9,759	9,539	(2.3%)
Personnel costs	(1,505)	(1,480)	(1.7%)
Other operating expenses	(813)	(818)	0,7%
Net change in technical provisions for insurance business and other claims expenses	(6,728)	(6,574)	(2.3%)
Depreciation & amortization	(151)	(142)	(6.0%)
EBIT	562	526	(6.4%)
Net interest income / (Expense)	6	6	n.m.
Profit before tax	568	532	(6.3%)
Tax	(201)	(181)	(10.0%)
Net income	367	351	(4.4%)

€m	FY 2016	1Q 2017	Var.%
Cash & Equivalents	3,902	4,126	5.7%
BancoPosta related Cash	2,494	2,957	18.6%
Receivables & Inventory	2,073	2,518	21.5%
Financial Assets	174,362	175,225	0.5%
Tangible and Intangible Assets	2,649	2,587	(2.3%)
Other	5,005	5,804	16.0%
Non-current assets and groups of assets held for sale	2,720	2,665	(2.0%)
Total Assets	193,205	195,882	1.4%
Trade Payables	1,506	1,398	(7.2%)
Financial liabilities	60,921	62,570	2.7%
Technical Reserves	113,678	115,494	1.6%
Other	6,906	7,071	2.4%
Liabilities related to assets held for sale	2,060	2,044	(0.8%)
Total Liabilities	185,071	188,577	1.9%
Shareholders capital	1,306	1,306	-
Reserves	6,828	5,999	(12.1%)
Totale Equity	8,134	7,305	(10.2%)
Total Liabilities & Equity	193,205	195,882	1.4%

€m	1Q 2016	1Q 2017	Var.%
Net income	367	351	(4.4%)
Depreciation and amortization	151	142	(6.0%)
Net provisions for risks and charges	115	186	61.7%
(Use of Provisions for risks and charges)	(106)	(80)	(24.5%)
Net change in employee termination benefits and pension plans	(33)	(54)	63.6%
Other	10	19	90.0%
FFO	504	564	11.9%
Change in working capital	159	(488)	n.m.
Effect related to net assets held for sale	0	26	n.m.
Cash flow from operations	663	102	(84.6%)
Capital expenditures	(62)	(81)	30.6%
Net change in subsidiaries and associates	0	(283)	n.m.
Disposals	2	2	-
Cash flow from investments	(60)	(362)	n.m.
Cash Flow from financial assets and liabilities	(652)	484	n.m.
Cash flow from financing	(652)	484	n.m.
Net change in cash	(49)	224	n.m.

€m	FY 2016	1Q 2017	Var.%
Trade receivables	2,172	2,678	23.3%
Inventories	137	137	-
Other receivables and assets	3,671	3,880	5.7%
Current tax receivables	15	15	-
Trade payables	(1,506)	(1,398)	(7.2%)
Other liabilities	(3,218)	(3,389)	5.3%
Current tax liabilities	(88)	(257)	n.m.
Working Capital	1,183	1,666	40.8%
Deferred tax asset	799	1,039	30.0%
Deferred tax liabilities	(746)	(517)	(30.7%)
Working Capital and deferred taxes	1,236	2,188	77.0%

€m	1Q 2016	1Q 2017	Var.%
Trade receivables	(15)	(506)	n.m.
Inventories	0	0	n.m.
Other receivables and assets	(157)	(209)	33.1%
Current tax receivables	(1)	0	n.m.
Trade payables	(111)	(108)	(2.7%)
Other liabilities	247	171	(30.8%)
Current tax liabilities	207	169	(18.4%)
Deferred tax assets	(20)	(240)	n.m.
Deferred tax liabilities	(139)	(229)	64.7%
Total Change in Working capital and deferred taxes	11	(952)	n.m.
Financial Income on discounted receivables	2	1	(50.0%)
Net write-downs and loss on receivables	(7)	(10)	n.m.
Deferred tax on fair value changes and TFR actuarial income	153	473	n.m.
Adjustments (non monetary items and shareholders' transactions)	148	464	n.m.
Change in Working Capital and deferred taxes as per cash flow statement	159	(488)	n.m.

€m

Property, plant and equipment	2,007	Totale Equity	2,835
Investment property	55
Intangible assets	424	Provisions for risks and charges	271
Investments*	2,156	Employee termination benefits and pension plans	1,276
Financial assets	895	Financial liabilities	1,242
Trade receivables	4	Deffered tax liabilities	24
Deferred tax assets	442	Other liabilities	67
Other receivables and assets	141
Total Non-current assets	6,124	Total Non-current liabilities	2,880
Inventories	134	Provisions for risks and charges	839
Trade receivables	2,187	Trade payables	1,299
Current tax assets	14	Current tax liabilities	212
Other receivables and assets	441	Other liabilities	1,247
Financial assets	276	Financial liabilities	1,257
Cash and cash equivalents	1,393
Total Current assets	4,445	Total Current liabilities	4,854
Total Assets	10,569	Totale Equity and Liabilities	10,569

Assets Equity and Liabilities

Totale Equity	2,835
Provisions for risks and charges	271
Employee termination benefits and pension plans	1,276
Financial liabilities	1,242
Deffered tax liabilities	24
Other liabilities	67

Total Non-current liabilities	2,880
Provisions for risks and charges	839
Trade payables	1.299
Current tax liabilities	212
Other liabilities	1.247
Financial liabilities	1.257

Total Current liabilities	4.854
Totale Equity and Liabilities	10.569

* It includes investments accounted for at cost in financial and insurance sectors

MAIL & PARCELS AND OTHER SERVICES NET DEBT BREAKDOWN 1Q 2017

€m	FY 2016	1Q 2017	Var.%
Cash and Cash Equivalents	1,577	1,401	(11.2%)
Current Financial Assets	63	53	(15.9%)
Short term debt	(2)	0	n.m.
Current part of long term debt	(14)	(20)	42.9%
Other current financial liabilities	(22)	(23)	4.5%
Current Financial Position	(38)	(43)	13.2%
Current Net Financial Position	1,602	1,411	(11.9%)
Long term debt	(400)	(400)	-
Bonds	(798)	(798)	-
Other non current financial liabilities	(50)	(44)	(12.0%)
Non Current Financial Position	(1,248)	(1,242)	(0.5%)
Net Financial Position	354	169	(52.3%)
Non current financial assets	651	645	(0.9%)
Net Financial Position - Mail & Parcel and Other Sercvices	1,005	814	(19.0%)
Intersegment financial receivables	522	473	(9.4%)
Intersegment financial payables	(634)	(1,184)	86.8%
Net Financial Position (net of intersegments) *	893	103	(88.5%)

* Including a Net Financial Position of Other Services (€38 for the first quarter 2017 and € 48m in 2016)

€m	1Q 2016	1Q 2017	Var.%
Total revenue	1,710	1,677	(1.9%)
o/w Market revenue	1,556	1,518	(2.5%)
o/w Intercompany revenue	154	159	4.2%
Personnel costs	(33)	(33)	n.m.
Other operating expenses	(1,410)	(1,416)	0.4%
EBITDA	267	229	(14.4%)
EBITDA margin	15.6%	13.6%
Depreciation and amortisation	(0)	(0)	n.m.
EBIT	267	228	(14.6%)
EBIT margin	15.6%	13.6%

€m	1Q 2016	1Q 2017	Var.%
Total revenue	7,210	7,057	(2.1%)
o/w Market revenue	7,210	7,057	(2.1%)
o/w Intercompany revenue	0	0	n.m.
Personnel costs	(10)	(11)	2.2%
Other operating expenses	(7,088)	(6,887)	(2.8%)
EBITDA	111	160	43.2%
EBITDA margin	1.5%	2.3%
Depreciation and amortisation	(4)	(4)	n.m.
EBIT	108	155	43.5%
EBIT margin	1.5%	2.2%

€m	1Q 2016	1Q 2017	Var.%
Total revenue	2,288	2,248	(1.7%)
o/w Market revenue	936	914	(2.4%)
o/w Intercompany revenue	1,352	1,334	(1.3%)
Personnel costs	(1,457)	(1,432)	(1.7%)
Other operating expenses	(517)	(550)	6.5%
EBITDA	314	266	(15.4%)
EBITDA margin	13.7%	11.8%
Depreciation and amortisation	(138)	(132)	(4.3%)
EBIT	177	135	(23.7%)
EBIT margin	7.7%	6.0%

OTHER SERVICES POSTE MOBILE KEY FINANCIALS

€m	1Q 2016	1Q 2017	Var.%
P&L
Total revenue	79	57	(28.8%)
o/w Market revenue	58	50	(12.3%)
o/w Intercompany revenue	22	6	(72.1%)
Personnel costs	(5)	(4)	(25.4%)
Other operating expenses	(54)	(39)	(28.1%)
EBITDA	20	14	(31.7%)
EBITDA margin	25,0%	24,0%
Depreciation and amortisation	(9)	(6)	(39.3%)
EBIT	10	8	(24.9%)
EBIT margin	13,2%	13,9%
Non-operating income/(expenses)	(0)	(0)	(28.5%)
Profit before taxes	10	8	(24.9%)
Taxes	(3)	(2)	(30.2%)
Profit after taxes	7	6	(22.5%)

€m	1Q 2016	1Q 2017	Var.%
Cash flow statement
FFO	17,0	11,6	(31.8%)
Cash flow from investments	(6,1)	(5,7)	7.0%
Net change in cash	(7,7)	(13,1)	(69.7%)
Other key data
Average number of users (sim cards -#k) 1	3,612	3,659	1.3%
ARPU (€)	4,8	4,3	(10.7%)

1. calculated on total sim cards (active and non active sim cards)

FINANCIAL SERVICES COST STRUCTURE AND PROFITABILITY AT DIVISIONAL LEVEL

1. Includes intersegment revenues

FOCUS ON INSURANCE AND ASSET MANAGEMENT REVENUES BREAKDOWN

INSURANCE AND ASSET MANAGEMENT COST STRUCTURE AND PROFITABILITY AT DIVISIONAL LEVEL

1. Includes intersegment revenues

SEGMENT FLOW DESCRIPTION 1Q 2017

(€m)

	Mail & Parcels Including Network	Financial Services	Insurance and Asset Management	Poste Italiane Group2
Market Revenues	914	1,518	7,057	9,539
Intersegment Revenues	1,334	159	-	-
Totale Revenues	2,248	1,677	7,057	9,539
Personnel Costs	(1,432)	(33)	(11)	(1,480)
Other operating costs1	(666)	(92)	(162)	(960)
Net change in Technical Provisions	-	-	(6,574)	(6,574)
Intersegment Costs	(15)	(1,325)	(156)	-
Operating Costs	(2,113)	(1,449)	(6,902)	(9,013)
Operating Profit (Loss)	135	228	155	526

1. Including external costs, and D&A

2. Including Other Services (Poste Mobile)

DISCLAIMER

This presentation contains certain forward-looking statements that reflect the Company's management's current views with respect to future events and financial and operational performance of the Company and its subsidiaries. These forward-looking statements are based on Poste Italiane S.p.A.'s current expectations and projections about future events. Because these forward-looking statements are subject to risks and uncertainties, actual future results or performance may differ materially from those expressed in or implied by these statements due to any number of different factors, many of which are beyond the ability of Poste Italiane S.p.A. to control or estimate precisely, including changes in the regulatory environment, future market developments, fluctuations in the price and availability of fuel and other risks. You are cautioned not to place undue reliance on the forward-looking statements contained herein, which are made only as of the date of this presentation. Poste Italiane S.p.A. does not undertake any obligation to publicly release any updates or revisions to any forward-looking statements to reflect events or circumstances after the date of this presentation. This presentation does not constitute a recommendation regarding the securities of the Company. This presentation does not contain an offer to sell or a solicitation of any offer to buy any securities issued by Poste Italiane S.p.A. or any of its subsidiaries. Pursuant to art. 154-BIS, par. 2, of the Unified Financial Act of February 24, 1998, the executive in charge of preparing the corporate accounting documents at Poste Italiane S.p.A., Luciano Loiodice, declares that the accounting information contained herein corresponds to document results, books and accounting records.

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