H1 2017 Results and Q2 Trading Update

This presentation may contain forward looking statements based on current expectations and projects of the Group in relation to future events. Due to their specific nature, these statements are subject to inherent risks and uncertainties, as they depend on certain circumstances and facts, most of which being beyond the control of the Group. Therefore actual results could differ, even to a significant extent, with respect to those reported in the statements.

H1 2017 BUSINESS AND ECONOMIC HIGHLIGHTS

NET SALES AND ADJ. ¹ ECONOMIC PERFORMANCE REFLECTED:

Q1 SHORTFALL IN WORLDWIDE SALES ORDER FULFILLMENT DUE TO NEW IT SYSTEM CHALLENGES IN PADUA DC:
LOW SALES AND OPERATING DELEVERAGE
Q2 RECOVERY OF BACK ORDERS AND RESTORATION OF NORMAL WORKING CONDITIONS AND SERVICE LEVELS IN PADUA DC:
GROWTH OF GOING FORWARD BRAND* SALES AND GROUP EBITDA
- Positive contribution by our Own Core Brands (H1 in line with YA) led by strong Smith, Polaroid recovery and Carrera turnaround progress
- IMEA, CEE and China: the biggest positive drivers
- Positive Western Europe vs challenging comps, yet softer order intake
- Challenging trading conditions in North America
- Progress on cost savings and overhead productivity plan

• IMPACT OF THE EXIT OF THE GUCCI LICENSE AND ITS REPLACEMENT WITH THE STRATEGIC PRODUCT PARTNERSHIP AGREEMENT

* THE GOING FORWARD BRAND SALES DO NOT INCLUDE THE GUCCI BUSINESS

² 2017 - Focused on our long-term journey for sustainable growth

in millions of Euro and % change vs same period of 2016

in millions of Euro

2017 - Focused on our long-term journey for sustainable growth

NET SALES PERFORMANCE OF GOING FORWARD BRANDS*

H1 2017: -6.3% @ CFX (-5.7% Wholesale)

NORTH AMERICA Total -4.2%	EUROPE	ASIA	ROW
Wholesale -2.3%	-6.7%	-17.2%	-5.3%

Q2 2017: +1.2% @ CFX (+2.0% Wholesale)

NORTH AMERICA Total -7.6% Wholesale -7.3%	EUROPE +6.9%	ASIA -3.8%	ROW +17.3%
• Reflecting market challenges and ongoing strategic commercial actions: - Soft business in department stores - Strategic commercial partnerships renewal, independent opticians - Retail down H1, but Q2 markedly better - Strong sport channel	• Backorders recovery on tough comps: - CEE and North Europe top drivers - Positive broad based brand performance - Soft Dior on tough comps	• Resetting of Going Forward brands: - Weak environment in some areas - New distribution strategy in Korea - Distributors business improving - Progress in China	• Continued strong progress: - IMEA leading performer, back in line with YA in H1 - LATAM recovering well, thanks to Mexico solid growth - Brazil soft performance

* THE GOING FORWARD BRAND SALES DO NOT INCLUDE THE GUCCI BUSINESS

GROSS MARGIN PERFORMANCE

in millions of Euro and % on total net sales

60.3%

Wholesale 54.0%

KEY DRIVERS

Q2 Gross Margin dilution mainly explained by Gucci/SPPA dynamics: license out, SPPA in (ca 400bps);
Q2 volumes growth by Going Forward Portfolio offset by negative brand mix effect and Retail decline;
H1 Gross Margin impacted by Q1 very weak sales order fulfilment due to Padua DC challenges.

ADJ.¹ EBITDA PERFORMANCE

In millions of Euro and % on total net sales

KEY DRIVERS

Progress on cost saving initiatives and overheads productivity plan benefitting Q2 operating performance;
SPPA plus pro-rata accounting compensation fully compensating the lost profit/margin of the Gucci license;
Q2 negative retail performance;
H1 Adj. ¹ EBITDA Margin impacted by Q1 very weak sales order fulfilment due to Padua DC challenges.

ADJ.¹ GROUP NET RESULT

2017 - Focused on our long-term journey for sustainable growth

13.0

Cash Flow from Operating Activities

FREE CASH FLOW

in millions of Euro

FREE CASH FLOW

KEY DRIVERS

Negative economic result of the period;
NET WC absorbing €33.5 Mio, mainly due to decrease of trade payables;
CAPEX of €20.8 Mio for plant investments + EYEWAY project.

GROUP NET DEBT

in millions of Euro

+9.6% vs H116

PROGRESS ON OUR STRATEGIC CHOICES

2) Our multi-segment brands Portfolio Balance

3) Our focus on Innovation

IN OUR CORE REGIONS, WE WORK TO ESTABLISH PREFERRED CUSTOMER PARTNERSHIPS
Focus on a renewed strategic direction to drive commercial partnerships in North America, building on:
- − solid and transparent commercial policies and trade terms, aligned with our brand portfolio priorities and strategies
- − development and regeneration of salesforce capabilities to improve execution of commercial plans, in particular with independent opticians

WE CONTINUE TO BUILD SUSTAINABLY OUR EMERGING MARKETS:

• New exclusive distribution agreement in Saudi Arabia, leveraging IMEA strong momentum

OUR MULTI-SEGMENT BRANDS PORTFOLIO BALANCE

5 year renewal of the licensing agreement with LIZ CLAIBORNE

The Liz Claiborne and Claiborne brands are two of Safilo's most sought after collections in the U.S., delivering a stable and healthy business. Two strong optical brands, both highly regarded by independent optical retailers and their customers, supports the Group's objective of growing its optical business.

Moving forward with our Digital Strategy, through innovative and integrated Social/PR/ Media and instore campaigns and growing e-commerce business

Digital Media

2017 Digital Partnership with HEARST in USA

develop branded content, focusing on Carrera and Smith
deliver display adv campaign within HEARST platforms (Elle, Cosmopolitan, Esquire, Popular Mechanics)
create new business opportunities (Smith.com and significant commercial partnership with Nordstrom for Carrera)

Digital communication

2017 Influencer Activation on Instagram

use micro-influencers to reach, engage consumers as well as develop brand content. Plus, drive e-com sales

An extraordinary Instagram activity, leading in eyewear

OUR FOCUS ON INNOVATION

B2B2C E-commerce

Safilo is partnering with key customers to drive online sales with joint business and marketing plans

POLAROID IS #1 BRAND FOR MYOPTIQUE GROUP IN 2016

B2B E-commerce

Safilo's new B2B platform for customers to order products and download marketing content

- CA 5500 ACTIVE CUSTOMERS - 2016 NETCOMM E-COMMERCE AWARD FOR BEST B2B PLATFORM

B2C E-Commerce

Safilo selling directly to consumers

- OUR BEST PRACTICE IN E-COMMERCE: SMITH

PREPARING FOR CARRERA AND POLAROID

H2 2017 FOCUS AREAS

Increasing efforts on order generation, based on our Fall-Winter collections and go-to-market campaigns
Launch of SAFILO's completely renovated optical collection, building on our renewed Optical Strategy
Launch of Lowdown Focus (Smith X), further driving Smith's strong e-commerce business
Executing Polaroid product plans, with special focus on India, Nordic and Russia
Leveraging Carrera's FW ADV Campaign and deployment of global and local activities
Special focus on Dior optical business and Dior Homme, backed by easier comps
Progressing with the implementation of our cost saving programs, productivity and efficiency plan
Progress on our Eyebuy program

AMONG THE MOST LOVED AND EDITORIALLY FEATURED EYEWEAR WORLDWIDE

• Our collections continue to enjoy excellent market reception. Our Own Core Brands are among the most well received product collections and iconic designs of the Fall-Winter 2017 season

Appendices

1 In H1 2017, the adjusted economic results exclude non-recurring costs of Euro 3.7 million, mainly related to the reorganization of the Ormoz plant in Slovenia and other overhead cost saving initiatives (Euro 3.0 on the Net result). H1 2017 adjusted economic results include income of Euro 21.5 million as a pro-rata portion of the accounting compensation for the early termination of the Gucci license, equal to Euro 43 million for the full year 2017.

In Q2 2017, the adjusted EBITDA excludes non-recurring costs of Euro 0.4 million related to overhead cost saving initiatives and includes income of Euro 10.8 million as a pro-rata portion of the accounting compensation for the early termination of the Gucci license.

In the first half of 2016, the adjusted operating results excluded non-recurring costs of Euro 7.1 million (Euro 6.1 million on EBITDA), including Euro 5.9 million related to overhead cost saving initiatives, such as the planned integration of Vale of Leven (Scotland) Polaroid lens production into Safilo's China based corporate supply network, and Euro 1.2 million related to commercial restructuring costs in the EMEA region.

Economic results

in millions of Euro and % on net sales

	H1 2017	%	H1 2016	%	% Change

Net sales	552.6	100.0	651.1	100.0	-15.1%
Cost of sales	(265.4)	(48.0)	(256.5)	(39.4)	3.5%
Gross profit	287.2	52.0	394.6	60.6	-27.2%
Selling and marketing expenses	(216.6)	(39.2)	(272.6)	(41.9)	-20.5%
General and administrative expenses	(85.3)	(15.4)	(85.1)	(13.1)	0.2%
Other operating income (expenses)	18.0	3.3	(6.6)	(1.0)	n.s.
Operating profit	3.3	0.6	30.4	4.7	-89.2%
Financial charges, net	(7.3)	(1.3)	0.8	0.1	n.s.
Profit/(Loss) before taxation	(4.0)	(0.7)	31.2	4.8	n.s.
Income taxes	(5.6)	(1.0)	(14.7)	(2.3)	-62.1%
Net profit/(loss)	(9.6)	(1.7)	16.5	2.5	n.s.
Non-controlling interests	0.0	0.0	0.2	0.0	-100%
Net profit/(loss) attributable to the Group	(9.6)	(1.7)	16.3	2.5	n.s.
EBITDA	24.1	4.4	52.2	8.0	-53.8%

Adjusted¹ economic results

Adjusted1 EBIT	7.0	1.3	37.5	5.8	-81.4%
Adjusted1 EBITDA	27.8	5.0	58.3	8.9	-52.3%
Adjusted1 net profit/(loss) attributable to the Group	(6.6)	(1.2)	22.9	3.5	n.s.

in millions of Euro and % on net sales

	Q2 2017	%	Q2 2016	%	% Change
Net sales	315.3	100.0	349.5	100.0	-9.8%
Gross profit	170.4	54.0	210.4	60.2	-19.0%
EBITDA	33.7	10.7	32.4	9.3	3.9%
Adjusted1 economic result
Adjusted1 EBITDA	34.0	10.8	33.1	9.5	2.9%

Net sales performance

in millions of Euro

Net sales by geographical area	HY 2017	%	HY 2016	%			Change % Change % () Change % (*)
Europe	267.2	48.3	291.4	44.8	-8.3%	-7.8%	-6.7%
North America	221.8	40.1	259.8	39.9	-14.6%	-17.1%	-4.2%
Asia Pacific	28.9	5.2	58.8	9.0	-50.8%	-51.4%	-17.2%
Rest of the world	34.7	6.3	41.0	6.3	-15.5%	-20.0%	-5.3%
Total		552.6 100.0		651.1 100.0	-15.1%	-16.2%	-6.3%

Net sales by distribution channel	HY 2017	%	HY 2016	%			Change % Change % () Change % (*)
Wholesale Retail	519.0 33.6	93.9 6.1	612.4 38.7	94.1 5.9	-15.3% -13.2%	-16.3% -15.8%	-5.7% -14.3%
Total		552.6 100.0		651.1 100.0	-15.1%	-16.2%	-6.3%

(*) at constant exchange rates

(**) Sales performance at constant exchange rates of the Going Forward Brand Portfolio, excluding Gucci business

Net sales by geographical area	Q2 2017	%	Q2 2016	%			Change % Change % () Change % (*)
Europe	166.0	52.6	161.4	46.2	2.9%	3.3%	6.9%
North America	107.4	34.1	132.7	38.0	-19.1%	-20.8%	-7.6%
Asia Pacific	17.9	5.7	32.1	9.2	-44.4%	-44.6%	-3.8%
Rest of the world	24.1	7.6	23.4	6.7	3.1%	-1.6%	17.3%
Total		315.3 100.0		349.5 100.0	-9.8%	-10.6%	1.2%

Q2 2017	%	Q2 2016	%

	93.6		93.7			2.0%
20.1	6.4		6.3		-10.7%	-8.8%
					-10.6%	1.2%
	295.2	315.3 100.0		327.6 21.9 349.5 100.0		Change % Change % () Change % (*) -9.9% -10.6% -8.3% -9.8%

(*) at constant exchange rates

(**) Sales performance at constant exchange rates of the Going Forward Brand Portfolio, excluding Gucci business

in millions of Euro

	June 30, 2017	December 31, 2016	Change
Net working capital	283.5	261.7	21.7
Tangible and intangible fixed assets	683.3	710.0	(26.7)
Financial fixed assets	0.0	0.0	0.0
Non-current assets held for sale	1.4	1.5	(0.0)
Other assets / (liabilities), net	(48.0)	(52.0)	4.0
Net invested capital	920.3	921.2	(0.9)
Net financial position	(112.7)	(48.4)	(64.3)
Group Shareholders' equity	(807.6)	(872.8)	65.2
Non-controlling interests	0.0	0.0	0.0

Net Working Capital

in millions of Euro

	June 30, 2017	June 30, 2016	Change
Trade receivables	235.9	266.7	(30.8)
Inventories	271.1	268.6	2.4
Trade payables	(223.5)	(230.2)	6.7
Net working capital	283.5	305.2	(21.7)
% on net sales LTM	24.6%	24.3%

Free Cash Flow

in millions of Euro

	H1 2017	H1 2016
Cash flow from operating activities before changes in working capital	(5.6)	31.9
Changes in working capital	(30.8)	(18.9)
Cash flow operating activities	(36.4)	13.0
Cash flow investing activities	(20.8)	(22.4)
Free cash flow	(57.2)	(9.3)

Exchange Rates

	As of			(Appreciation)/ Depreciation	Avgerage for	(Appreciation)/ Depreciation
Currency	Code	June 30, 2017	December 31, 2016	%	June 30, 2017	June 30, 2016	%
US Dollar	USD	1.1412	1.0541	8.3%	1.0830	1.1157	-2.9%
Hong-Kong Dollar	HKD	8.9068	8.1751	9.0%	8.4199	8.6669	-2.8%
Swiss Franc	CHF	1.0930	1.0739	1.8%	1.0766	1.0959	-1.8%
Canadian Dollar	CAD	1.4785	1.4188	4.2%	1.4453	1.4846	-2.6%
Japanese Yen	YEN	127.7500	123.4000	3.5%	121.7804	124.4162	-2.1%
British Pound	GBP	0.8793	0.8562	2.7%	0.8606	0.7787	10.5%
Swedish Krown	SEK	9.6398	9.5525	0.9%	9.5968	9.3020	3.2%
Australian Dollar	AUD	1.4851	1.4596	1.7%	1.4364	1.5218	-5.6%
South-African Rand	ZAR	14.9200	14.4570	3.2%	14.3063	17.1977	-16.8%
Russian Ruble	RUB	67.5449	64.3000	5.0%	62.8057	78.3228	-19.8%
Brasilian Real	BRL	3.7600	3.4305	9.6%	3.4431	4.1310	-16.7%
Indian Rupee	INR	73.7445	71.5935	3.0%	71.1760	74.9940	-5.1%
Singapore Dollar	SGD	1.5710	1.5234	3.1%	1.5208	1.5398	-1.2%
Malaysian Ringgit	MYR	4.8986	4.7287	3.6%	4.7511	4.5734	3.9%
Chinese Renminbi	CNY	7.7385	7.3202	5.7%	7.4448	7.2955	2.0%
Korean Won	KRW	1,304.5600	1,269.3600	2.8%	1,236.3302	1,318.8060	-6.3%
Mexican Peso	MXN	20.5839	21.7719	-5.5%	21.0441	20.1703	4.3%
Turkish Lira	TRY	4.0134	3.7072	8.3%	3.9391	3.25832	20.9%
Dirham United Emirates	AED	4.1893	3.869601	8.3%	3.97578	4.09588	-2.9%

Polaroid	$1$ ior	BOSS	HIGO	havaianas ^®
CARRERA	DIOR HOMME	MARC JACOBS	GIVENCHY PARIS	BANANA REPUBLIC
		ELIE SAAB	MOSCHINO*	rag & bone* NEW YORK
	CÉLINE	kate spade	LOVE *	Juice Couture BLACK LABEL
SMITH	FENDI	NEW YORK	MOSCHINO	low angeles
		FOSSIL	BROWN 80881	Liz claiborne
OXYDO	MaxMara	TOMMY INILFIGER	MAX&Co	- Fatis Arenwe
SAFILO	JIMMY CHOO	swatch the oo eyes	pierre cardin	JACK SPADE

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Safilo Group — Investor Presentation 2017

4328_rns_2017-08-02_cbc8d1a1-b3e7-40e4-bb06-b4b19613cbaf.pdf

H1 2017 Results and Q2 Trading Update

H1 2017 BUSINESS AND ECONOMIC HIGHLIGHTS

• IMPACT OF THE EXIT OF THE GUCCI LICENSE AND ITS REPLACEMENT WITH THE STRATEGIC PRODUCT PARTNERSHIP AGREEMENT

2017 - Focused on our long-term journey for sustainable growth

NET SALES PERFORMANCE OF GOING FORWARD BRANDS*

H1 2017: -6.3% @ CFX (-5.7% Wholesale)

Q2 2017: +1.2% @ CFX (+2.0% Wholesale)

GROSS MARGIN PERFORMANCE

KEY DRIVERS

ADJ.1 EBITDA PERFORMANCE

KEY DRIVERS

ADJ.1 GROUP NET RESULT

13.0

FREE CASH FLOW

KEY DRIVERS

PROGRESS ON OUR STRATEGIC CHOICES

WE CONTINUE TO BUILD SUSTAINABLY OUR EMERGING MARKETS:

OUR MULTI-SEGMENT BRANDS PORTFOLIO BALANCE

5 year renewal of the licensing agreement with LIZ CLAIBORNE

Digital Media

2017 Digital Partnership with HEARST in USA

Digital communication

2017 Influencer Activation on Instagram

OUR FOCUS ON INNOVATION

B2B2C E-commerce

B2B E-commerce

B2C E-Commerce

H2 2017 FOCUS AREAS

AMONG THE MOST LOVED AND EDITORIALLY FEATURED EYEWEAR WORLDWIDE

Appendices

Economic results

in millions of Euro and % on net sales

Adjusted1 economic results

Net sales performance

in millions of Euro

in millions of Euro

Net Working Capital

Free Cash Flow

Exchange Rates

More from Safilo Group

Safilo Group Investor Presentation 2017

ADJ.¹ EBITDA PERFORMANCE

ADJ.¹ GROUP NET RESULT

Adjusted¹ economic results