Poste Italiane

Investor Presentation • Nov 8, 2018

POSTE ITALIANE 3Q & 9M 2018 FINANCIAL RESULTS

Rome, 8 November 2018

EXECUTIVE SUMMARY

BUSINESS REVIEW

CLOSING REMARKS

Q&A

3Q 2018 results on track to meet all Deliver 2022 targets for 2018

Deliver 2022 actions supporting the performance of all segments:

• Mail, Parcel & Distribution: Joint Delivery Model supporting B2C parcels
• Payments, Mobile & Digital: creation of Postepay e-money institution
• Financial Services: growth in third party distribution and improving postal savings, reducing reliance on capital gains
• Insurance Services: improving mix in Life and P&C products

Solvency ratio benefitting from effective capital management actions

Group dividend up by 5% YoY, as committed to in Deliver 2022

€ m unless otherwise stated

1. Excludes net capital gains, IFRS 9 impact on Visa, BdM-MCC disposal, IFRS 15 impact; 2. Excludes net capital gains, early retirement incentives and real estate funds provisions.

DELIVER 2022 – PROGRESS UPDATE

Deliver 2022 initiatives well on track and focus is on execution

MANAGING GOVERNMENT BOND VOLATILITY

No operational impact on business or strategic plan targets

EXECUTIVE SUMMARY

BUSINESS REVIEW

CLOSING REMARKS

Q&A

OPERATING PROFITABILITY PROGRESSION

EBIT up, mainly supported by Mail, Parcel & Distribution Operating profitability improving thanks to positive revenue contribution from all segments

€ m unless otherwise stated

1. Excludes net capital gains on investment portfolio, early retirement incentives and real estate funds provisions.

MAIL, PARCEL & DISTRIBUTION PROFITABILITY

Strong mail quartely revenues, parcel growth acceleration

€ m unless otherwise stated

1. Includes Philately, Patenti Via Poste, Poste Motori, Mistral Air and other revenues; 2. Includes income received from Other Segments in return for use of the distribution network and Corporate Services.

MAIL, PARCEL & DISTRIBUTION VOLUMES

Continued shift from Mail to Parcel with B2C +24% in 9M 2018

AVERAGE PRICE INDEX (base 100) 6 7 18 1 4 3Q 2017 3Q 2018 31 0% +29% +13% -9% 97 3Q 2017 3Q 2018 +5 +17.2% 100 96 9M 2017 9M 2018 21 22 40 50 4 15 4 13 9M 2017 9M 2018 81 89 -5% +24% +4% -18% +8 +9.2%

KEY HIGHLIGHTS

• Mail volumes decrease related to lower margin products (e.g. direct marketing), while average prices benefitted from repricing since July
• Parcel volumes positive trend boosted by B2C (+29% in 3Q, +24% in 9M 2018) and recovery of B2B (+13% in 3Q and +4% in 9M)
• Overall parcel tariff down due to volumes mix effect, with B2C prices up in the 3Q and stable in 9M 2018

PAYMENTS, MOBILE & DIGITAL

Strong progression of revenues and operating profitability

€ m unless otherwise stated

1. Includes fees from 'bollettino' cashed-in, tax payments slips and money transfer.

FINANCIAL SERVICES

Higher revenues in 9M 2018 more than offsetting lower planned capital gains

€ m unless otherwise stated

1. Includes revenues from electronic money services, fees for collection and payment services; 2. Includes reported revenues from custody accounts, credit cards, other revenues from distribution of third parties products;

2. Gross capital gains netted by minus; 4. Based on adjusted revenues from capital gains, IFRS 15 effect and MCC-BdM.

GROUP TOTAL FINANCIAL ASSETS

Resilient business model delivering positive net inflows with strong contribution from retail

€ bn unless otherwise stated

1. Not including asset under custody; 2. Deposits do not include Repo and Poste Italiane liquidity; 3. Including interests accrued.

KEY HIGHLIGHTS

base

Total financial assets increased by 7bn in 9M

Insurance products +6.4bn of which +0.6bn unit linked and multiasset Class III, thanks to the launch of the new multiassets products in July 2018

Postal savings net inflows significantly improving in 3Q 2018, thanks to new

Deposits +4.8bn supported by Public

Mutual funds +0.4bn despite negative

Administration accounts and resilient retail

commercial initiatives

market conditions

2018, with positive net inflows of 6.8bn:

€ m unless otherwise stated

1. Average postal savings reported according to the remuneration scheme agreed with CDP, which excludes interests accrued year-to-date and based on a maturity of postal saving books adjusted for an estimate of potential early redemptions.

INSURANCE SERVICES OPERATING RESULTS

Ongoing focus on Private Pension Plan and P&C

€ m unless otherwise stated

NET TECHNICAL PROVISIONS

Positive net inflows in 9M 2018, more than offsetting market effect

€ m unless otherwise stated

1. Includes non-life technical reserves and net of re-insurance reserves; 2. Includes life protection; 3. Includes interests, upfront fees and other minor items.

SOLVENCY II REQUIREMENTS

Proactive capital management actions supporting Solvency ratio up to a pro-forma fully loaded of ~210%

€ m unless otherwise stated

1. Retained earnings only related to lower dividends paid by Poste Vita to the parent company in 2018

Measures under regulatory approval Countercyclical and cost effective capital strengthening measure

€ m unless otherwise stated

1. Includes other expenses from financial activities, capitalised costs and expenses, and other operating costs; 2. Excluding BdM-MCC (0.5 €/m in 3Q 2017 and 34 €/m in 9M 2017); real estate funds provisions (-4 €/m in 3Q 2017, 8 €/m in 3Q 2018, 61 €/m in 9M 2017 and 24 €/m in 9M 2018) and provision for the early repayment of financial products (4 €/m in 3Q 2017 and 16 €/m in 9M 2017).

EXECUTIVE SUMMARY

BUSINESS REVIEW

CLOSING REMARKS

Q&A

Well on track to meet all 2018 Deliver 2022 financial and operational targets

Higher revenues across all business segments, better than expected performance in Mail

Continued cost discipline across the Group

Decreased reliance on capital gains

Deliver 2022: a five-year journey made up of many small steps on strategy, costs and revenues aimed at delivering shareholder value – remain focussed on execution

EXECUTIVE SUMMARY

BUSINESS REVIEW

CLOSING REMARKS

Q&A

APPENDIX

GROWTH IN PAYMENTS, MOBILE & DIGITAL

Confirmed positive trends of commercial KPIs across all business lines

1. An innovative electronic tool associated to a single customer, which is enabled through a mobile app to authorize payment transactions.

POSTE ITALIANE DIGITAL FOOTPRINT

Robust growth in digital use

REGISTERED ONLINE USERS STOCK

1. Source: App stores (iOS and Android); 2. Electronic identification refers to number of ID outstanding; 3. Digital system to monitor parcels' delivery.

GROWTH IN CONSUMER FINANCIAL TRANSACTIONS

# m

GROWTH IN TRACK&TRACE SEARCHES³

CURRENT ACCOUNTS AVERAGE VOLUMES AT A SOUND 58.3BN

Interest income up thanks to higher volumes offsetting lower yields

€ m unless otherwise stated

1. Includes current accounts, time deposits and repurchase agreements. Not including Poste Italiane's liquidity; 2. Entirely invested in floating rate deposits c/o MEF; 3. Includes business current accounts, PostePay business and other customers debt ; 4. Average yield calculated as interest income and realized net capital gains on average total financial assets; 5. Excludes derivatives.

ASSET MANAGEMENT PROGRESSING

Class III and new products supporting assets under management and fee generation

€ m unless otherwise stated

EoP ASSETS UNDER MANAGEMENT EVOLUTION

KEY HIGHLIGHTS

• Net inflows of mutual funds +0.4bn in 9M 2018, growing at a faster pace than the market
• Net inflows of class III and Unit linked products strongly up, in line with Deliver 2022 guidelines
• Running management fees increasing YoY faster than the assets under management

Net inflows from mutual funds, unit linked and multiasset Class III insurance products

€ m unless otherwise stated

INSURANCE GROSS WRITTEN PREMIUMS MIX UPGRADING

Changing mix within life products, higher GWP from Private Pension Plan and strong P&C

€ m unless otherwise stated

1. Includes Life Protection.

€ m unless otherwise stated

1. Includes Life Protection

INSURANCE SERVICES: BREAKDOWN OF PORTFOLIO

Details on portfolio and sensitivity

INVESTMENT PORTFOLIO DURATION

	Sep-17	Dec-17	Sep-18	Var. YoY
Unrealised gains (€/m)	7,840	8,225	1,141	-6,700
Minimum guaranteed return (Class I) (%)	0.90%	0.88%	0.82%	-8bps
Class I return (%)	2.91%	3.03%	2.76%	-14bps

1. Includes also liquidity, UCITS funds and shares with ≤5yrs duration.

Transitional measures subject to regulatory approval

1. TR = Techinal Reserves

HR COSTS DOWN THANKS TO MAIL, PARCEL & DISTRIBUTION RE-ORGANIZATION

Confirmed track record to manage reduction of headcounts

KEY HIGHLIGHTS

• HR costs per FTE at 40.8k, in line with 2018 target
• Average FTE reduction of c.3,300 YoY, more than in the last 3 years
• Labour costs/FTE benefitting from non-recurring items, costs in line with FY 2018 target

BANCOPOSTA: AN ASSET GATHERER, WITH A LOW RISK BALANCE SHEET

Solid capital ratios including the already announced capital increase

€ m unless otherwise stated

1. 10.50% Min. CET1 ratio required to distribute earnings (transitionally reduced to 9.25% in 2017 and 9.875% in 2018).

MAIL, PARCEL & DISTRIBUTION NET CASH POSITION

Solid liquidity position and further available undrawn facilities

€ m unless otherwise stated

DETAILS ON INTERCOMPANY REVENUES AND COSTS

Segment flow description: distribution fees 3Q 2018

€ m unless otherwise stated

• Fees paid by Financial Services Segment in return for use of the distribution network and other Corporate Services 1
• Fees paid by Insurance Service Segment vs Financial Services in return for use of Group's distribution network 2
• Fees paid by Payments, Mobile & Digital Segment vs Financial Services Segment in return for use of Group's distribution network 3
• Fees paid by Financial Services Segment vs Payments, Mobile & Digital Segment in return for product management services 4
• 5 Fees paid by Mail Parcel & Distribution vs Payments, Mobile & Digital Segment in return of some Corporate Services (TLC)

€m	3Q 2017	3Q 2018	Var.	Var.%	9M 2017	9M 2018	Var.	Var.%
Total revenues	2,395	2,522	127	5%	7,893	7,951	58	1%
of which:
Mail, Parcel and Distribution	849	828	-21	-2%	2,661	2,589	-72	-3%
Payments, Mobile and Digital	144	163	19	13%	422	470	48	11%
Financial Services	1,069	1,168	99	9%	3,779	3,844	65	2%
Insurance Services	333	363	30	9%	1,031	1,048	17	2%
Total costs	2,066	2,066	0	0%	6,717	6,442	-275	-4%
of which:
Total personnel expenses	1,307	1,305	-2	0%	4,241	4,151	-90	-2%
of which personnel expenses	1,300	1,295	-5	0%	4,229	4,122	-107	-3%
of which early retirement incentives	7	10	3	43%	12	29	17	n.m.
Other operating costs	627	628	1	0%	2,063	1,886	-177	-9%
Depreciation, amortisation and impairments	132	133	1	1%	413	405	-8	-2%
EBIT	329	456	127	39%	1,176	1,509	333	28%
EBIT Margin	14%	18%			15%	19%
Finance income/(costs) and profit/(loss) on investments accounted for using the equity method	6	21	15	n.m.	-69	43	112	n.m.
Profit before tax	335	477	142	42%	1,107	1,552	445	40%
Income tax expense	121	156	35	29%	383	496	113	30%
Profit for the period	214	321	107	50%	724	1,056	332	46%

MAIL, PARCEL & DISTRIBUTION PROFIT & LOSS

€m	3Q 2017	3Q 2018	Var.	Var.%	9M 2017	9M 2018	Var.	Var.%
Segment revenue	849	828	-21	-2%	2661	2589	-72	-3%
Intersegment revenue	993	1,071	78	8%	3,446	3,526	80	2%
Total revenues	1,842	1,899	57	3%	6,107	6,115	8	0%
Personnel expenses	1,271	1,269	-2	0%	4,109	4,029	-80	-2%
of which personnel expenses	1,265	1,261	-4	0%	4,102	4,010	-92	-2%
of which early retirement incentives	6	8	2	33%	7	19	12	n.m.
Other operating costs	514	497	-17	-3%	1,572	1,482	-90	-6%
Intersegment costs	15	16	1	7%	48	51	3	6%
Total costs	1,800	1,782	-18	-1%	5,729	5,562	-167	-3%
EBITDA	42	117	75	179%	378	553	175	46%
Depreciation, amortisation and impairments	123	124	1	1%	382	376	-6	-2%
EBIT	-81	-7	74	91%	-4	177	181	n.m.
EBIT MARGIN	-4.4%	-0.4%			-0.1%	2.9%
Finance income/(costs)	-12	-3	9	75%	-110	-17	93	85%
Profit/(Loss) before tax	-93	-10	83	89%	-114	160	274	n.m.
Income tax expense	-18	10	28	n.m.	-13	66	79	n.m.
Profit for the period	-75	-20	55	73%	-101	94	195	n.m.

PAYMENTS, MOBILE & DIGITAL PROFIT & LOSS

€m	3Q 2017	3Q 2018	Var.	Var.%	9M 2017	9M 2018	Var.	Var.%
Segment revenue	144	163	19	13%	422	470	48	11%
Intersegment revenue	79	78	-1	-1%	247	243	-4	-2%
Total revenues	223	241	18	8%	669	713	44	7%
Personnel expenses	7	7	0	0%	22	23	1	5%
of which personnel expenses	7	7	0	0%	22	23	1	5%
of which early retirement incentives	0	0	0	0%	0	0	0	0%
Other operating costs	39	43	4	10%	124	128	4	3%
Intersegment costs	124	132	8	6%	364	390	26	7%
Total costs	170	182	12	7%	510	541	31	6%
EBITDA	53	59	6	11%	159	172	13	8%
Depreciation, amortisation and impairments	5	5	0	0%	17	17	0	0%
EBIT	48	54	6	13%	142	155	13	9%
EBIT MARGIN	22%	22%			21%	22%
Finance income/(costs)	3	2	-1	-33%	6	2	-4	-67%
Profit/(Loss) before tax	51	56	5	10%	148	157	9	6%
Income tax expense	14	16	2	14%	41	40	-1	-2%
Profit for the period	37	40	3	8%	107	117	10	9%

€m	3Q 2017	3Q 2018	Var.	Var.%	9M 2017	9M 2018	Var.	Var.%
Segment revenue	1,069	1,168	99	9%	3,779	3,844	65	2%
Intersegment revenue	253	234	-19	-8%	770	749	-21	-3%
Total revenues	1,322	1,402	80	6%	4,549	4,593	44	1%
Personnel expenses	21	21	0	0%	84	71	-13	-15%
of which personnel expenses	20	19	-1	-5%	79	62	-17	-22%
of which early retirement incentives	1	2	1	100%	5	9	4	80%
Other operating costs	55	70	15	27%	304	217	-87	-29%
Depreciation, amortisation and impairments	0	0	0	0%	1	0	-1	-100%
Intersegment costs	1,058	1,133	75	7%	3,647	3,719	72	2%
Total costs	1,134	1,224	90	8%	4,036	4,007	-29	-1%
EBIT	188	178	-10	-5%	513	586	73	14%
EBIT MARGIN	14%	13%			11%	13%
Finance income/(costs)	1	1	0	0%	5	8	3	60%
Profit/(Loss) before tax	189	179	-10	-5%	518	594	76	15%
Income tax expense	51	44	-7	-14%	147	166	19	13%
Profit for the period	138	135	-3	-2%	371	428	57	15%

INSURANCE SERVICES PROFIT & LOSS

€m	3Q 2017	3Q 2018	Var.	Var.%	9M 2017	9M 2018	Var.	Var.%
Segment revenue	333	363	30	9%	1,031	1,048	17	2%
Intersegment revenue	0	0	0	n.m.	1	1	0	0%
Total revenues	333	363	30	9%	1,032	1,049	17	2%
Personnel expenses	8	8	0	0%	26	28	2	8%
of which personnel expenses	8	8	0	0%	26	27	1	4%
of which early retirement incentives	0	0	0	0%	0	1	1	0%
Other operating costs	19	18	-1	-5%	63	59	-4	-6%
Depreciation, amortisation and impairments	4	4	0	0%	13	12	-1	-8%
Intersegment costs	128	103	-25	-20%	405	359	-46	-11%
Total costs	159	133	-26	-16%	507	458	-49	-10%
EBIT	174	230	56	32%	525	591	66	13%
EBIT MARGIN	52%	63%			51%	56%
Finance income/(costs)	14	21	7	50%	30	50	20	67%
Profit/(Loss) before tax	188	251	63	34%	555	641	86	15%
Income tax expense	74	86	12	16%	208	224	16	8%
Profit for the period	114	165	51	45%	347	417	70	20%

OPERATIONAL KPI's		3Q 2017	3Q 2018	D% YoY	9M 2017	9M 2018	D% YoY
MAIL PARCELS & DISTRIBUTION	Mail Volumes (#m) Parcels delivered by mailmen(#m) Parcel Volumes (#m) B2C Revenues (€m)	697 8.9 26.1 56.6	652 10.9 30.6 73.7	-6.5% 22.5% 17.2% 30.2%	2,324 22.0 81.1 162.2	2,224 30.2 88.6 202.7	-4.3% 37.3% 9.2% 25.0%
PAYMENTS, MOBILE & DIGITAL	PostePay cards (#m) of which PostePay Evolution cards (#m) Total payment cards transactions (#bn) of which eCommerce transactions (#m) PosteMobile new products (#m) Digital e-Wallets (#m)	17.4 4.4 0.237 39.1 0.248 1.5	19.0 5.9 0.320 48.8 0.241 2.5	9.2% 34.1% 35.0% 24.8% -2.8% 66.7%	17.4 4.4 0.673 117.0 0.817 1.5	19.0 5.9 0.874 142.0 0.838 2.5	9.2% 34.1% 29.9% 21.4% 2.6% 66.7%
FINANCIAL SERVICES	Total Financial Assets - TFAs (€/bn) Product Sales (#m) Unrealized gains (€m)	505 2.1 1,654	513 2.1 -2,690	1.6% n.m. n.m.	505 6.0 1,654	513 6.3 -2,690	1.6% 5.0% n.m.
INSURANCE SERVICES	Gross Written Premiums (€m) GWP – Life (€m) GWP – Private Pension Plan (€m) GWP – P&C (€m)	5,307 5,025 249 32	3,856 3,573 237 46	-27.3% -28.9% -4.9% 43.6%	16,438 15,596 737 105	12,768 11,878 747 143	-22.3% -23.8% 1.4% 36.2%

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 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., Tiziano Ceccarani, declares that the accounting information contained herein corresponds to document results, books and accounting records.