GEOX GROUP FY18 RESULTS PRESENTATION FEBRUARY 27, 2019 FY18 - PowerPoint PPT Presentation

GEOX GROUP FY18 RESULTS PRESENTATION FEBRUARY 27, 2019

FY18 RESULTS| NET SALES BY CHANNEL FY18 RESULTS| HIGHLIGHTS  TOTAL SALES:EURO 827.2 MILLION, -6.5% (-5.5% AT COSTANT FOREX) MAINLY EXPLAINED BY: NETWORK OPTIMIZATION (80 NET CLOSURES IN FY2018) PRUDENT DECISIONS TAKEN TO IMPROVE THE QUALITY AND PROFITABILITY OF THE WHOLESALE CHANNEL UNUSUAL WEATHER CONDITIONS THAT AFFECTED MAINLY 1Q18 AND 3Q18 SALES POSITIVE TREND IN 4Q18 (+2.0%) MAINLY THANKS TO A POSITIVE LFL DOS (+3.4%, OUT OF WHICH E-COM +22%)  EBITDA ADJ*: EURO 48.2 MILLION (EURO 74.0 MILLION IN 2017)  NET RESULT REPORTED: EURO -5.3 MILLION (EURO 15.4 MILLION IN 2017)  NET RESULT ADJ*: EURO 2 MILLION (EURO 22.8 MILLION IN 2017)  NET FINANCIAL POSITION POSITIVE AT EURO 2.3 MILLION (EURO -5.4 MILLION IN 2017)  PROPOSED DIVIDEND: 0.025 € (0.06 € IN 2017)  LTI: PROPOSED A NEW STOCK GRANT PLAN *Excluding special items equal to Euro 9.8 million and related to network optimization and support and organizational review 2

FY18 RESULTS| NET SALES BY CHANNEL WHOLESALE NET SALES BY CHANNEL (MLN € ) • SELECTIVE CANCELLATIONS DUE TO A PRUDENT APPROACH TO CUSTOMERS AND REGIONS • LOWER REORDERS DUE TO UNUSUAL WEATHER FY17 FY18 885 • LOWER SALES OF OLD SEASON STOCK 827 • LOWER EARLY SS19 DELIVERIES IN 2018 (AS ALREADY ANNOUNCED) IN LINE WITH THE INITIAL ORDER 401 COLLECTION TREND 370 362 359 • A SLIGHTLY NEGATIVE IMPACT FROM FOREX 121 98 FRANCHISING WHOLESALE FRANCHISING DOS TOTAL • PLANNED NETWORK OPTIMIZATION (55 NET CLOSURES -7.8% -19.0% -0.9% -6.5% AND CONVERSION TO DOS IN 2018, APPROX. 11% OF -6.6% c.FX -18.3% c.FX 0.1% c.FX -5.5% c.FX THE FRANCHISING NETWORK AS AT DEC. 2017) • 4Q18 BENEFITED FROM THE RECOVERY OF SOME ORDERS POSTPONEMENT NET SALES BY CHANNEL (IN %) • LFL SLIGHTLY WORSE COMPARED TO DOS IN FY18. POSITIVE PERFORMANCE IN 4Q18 *[FY17] • FRANCHISING RECAPTURE IS NOT PART OF THE STRATEGY DOS 43% WHOLESALE 45% [41%*] [45%*] DOS • DOS FLAT AT COSTANT CURRENCY • LFL -2.3% IN FY18 MAINLY AFFECTED BY UNSEASONAL WEATHER IN 1Q AND 3Q. POSITIVE PERFORMANCE IN 4Q18 (+3.4%) FRANCHISING 12% • SLIGHTLY POSITIVE SPACE EFFECT [14%*] 3

FY18 RESULTS| L4L DOS AND CURRENT TRADING LFL PERFORMANCE – 2018 AND CURRENT TRADING - LFL PERFORMANCE FY18 • ITALY: LFL SUBSTANTIALLY IN LINE WITH GROUP +3.4% IN 4Q18 AVERAGE IN FY18. POSITIVE PERFORMANCE IN 4Q18 SLIGHTLY (MID-SINGLE DIGIT) • EUROPE: LFL SUBSTANTIALLY IN LINE WITH GROUP POSITIVE AVERAGE IN FY18. POSITIVE PERFORMANCE IN 4Q18 (LOW TO MID-SINGLE DIGIT) • NORAM: LFL POSITIVE (LOW TO MID SINGLE DIGIT) IN FY18 AND 4Q18 -2.3% • ROW: LFL SLIGHTLY POSITIVE IN FY18 (SUBSTANTIALLY FLAT IN 4Q18) -4.3% -4.7% • DOS WEB (GEOX.COM): +12% IN FY18 LFL BY QUARTER -8.9% 1Q18 1H18 9M18 FY18 W1-W8 2019 +0.5% IN 2H18 • 1Q18: LOWER SALES OF OLD SEASON STOCK (DRIVEN BY THE REDUCTION IN INVENTORIES) IN JAN AND FEB AND UNSEASONAL WEATHER CONDITIONS IN MARCH • 1Q18: LOWER SALES OF OLD SEASON STOCK (DRIVEN BY THE REDUCTION IN INVENTORIES) IN JAN AND FEB AND UNSEASONAL WEATHER CONDITIONS IN MARCH • 2Q18: IMPROVING TREND FROM MID – APRIL THANKS TO MORE USUAL WEATHER CONDITIONS • 2Q18: IMPROVING TREND FROM MID – APRIL THANKS TO THE RECOVERY IN WEATHER CONDITIONS • 3Q18: POSITIVE PERFORMANCE IN JULY AND AUGUST, BUT A VERY TOUGH • 3Q18: POSITIVE PERFORMANCE IN JULY AND AUGUST, BUT A VERY TOUGH SEPTEMBER DUE TO SEPTEMBER DUE TO UNUSUAL WEATHER CONDITIONS THAT DETERMINED A LATE UNSEASONAL WEATHER CONDITIONS THAT DETERMINED A LATE START OF THE FALL WINTER SEASON START OF THE FALL WINTER SEASON • 4Q18: POSITIVE TREND NOTWITHSTANDING A TOUGH COMPARISON (LFL +1.1% IN 4Q17) WITH A FLAT • 4Q18: POSITIVE TREND NOTWITHSTANDING A TOUGH COMPARISON (LFL +1.1% IN TREND IN OCTOBER, AND A POSITIVE PERFORMANCE IN NOVEMBER AND DECEMBER. 4Q17) WITH A FLAT TREND IN OCTOBER, AND A POSITIVE PERFORMANCE IN DOS WEB +22%, DOS B&M +2.1% NOVEMBER AND DECEMBER 4

FY18 RESULTS| NET SALES BY REGION NET SALES BY REGION (MLN € ) ITALY • PLANNED NETWORK OPTIMIZATION (18 NET CLOSURES IN 885 FY17 FY18 FY18) 827 • 1Q18 AND 3Q18 IMPACTED BY UNSEASONAL WEATHER CONDITIONS; POSITIVE PERFORMANCE IN 4Q18 383 EUROPE 355 258 240 187 182 • PLANNED NETWORK OPTIMIZATION (25 NET CLOSURES IN 57 51 FY18) • PERFORMANCE AFFECTED (AS FOR ITALY) BY UNSEASONAL WEATHER CONDITIONS IN MARCH AND ITALY EUROPE NORAM ROW TOTAL SEPTEMBER; FLATTISH PERFORMANCE IN 4Q18 -11.2% -6.9% -7.4% -2.7% -6.5% -7.2% c.FX NORAM -6.9% c.FX -7.3% c.FX +0.9% c.FX -5.5% c.FX • CLEANING UP OF THE EXISTING WHOLESALE DISTRIBUTION • NETWORK OPTIMIZATION (5 NET CLOSURES IN FY18); STRONG COMMITMENT TO RE-FOCUS BUSINESS ON THE MOST APPROPRIATE LOCATIONS NET SALES BY REGION (IN %) *[FY17] ROW ITALY 29% ROW 22% • [29%*] POSITIVE PERFORMANCE AT COSTANT FOREX [21%*] NOTWITHSTANDING NETWORK OPTIMIZATION (UNDER DISTRIBUTION AGREEMENT SHOPS: 30 NET CLOSURES IN FY 18) • LFL AND WHOLESALE SLIGHTLY POSITIVE NORAM 6% [6%*] EUROPE 43% [44%*] 5

FY18 RESULTS| NET SALES BY PRODUCT NET SALES BY PRODUCT (MLN € ) NET SALES BY PRODUCT (IN %) *[FY17] FY17 FY18 APPAREL10% [10%*] 885 827 797 744 88 83 FOOTWEAR APPAREL TOTAL FOOWEAR 90% -6.6% -5.3% -6.5% [90%*] -5.7% c.FX -3.8% c.FX -5.5% c.FX YEARLY TREND FOR FOOTWEAR AND APPAREL MAINLY IMPACTED BY: 1) NETWORK OPTIMIZATION 2) SELECTIVE APPROACH TO WHOLESALE CUSTOMERS 3) UNSEASONAL WEATHER CONDITIONS DOUBLE-DIGIT GROWTH FOR APPAREL IN 4Q18, MAINLY THANKS TO: 1) A POSITIVE PERFORMANCE (ESPECIALLY WOMEN) OF THE NEW COLLECTION 2) AN EASIER COMPARISON BASE 6

FY18 RESULTS| GEOX SHOPS NETWORK RETAIL NETWORK RETAIL NETWORK – # GEOX SHOPS - GEOX SHOPS EVOLUTION IN 2018 DECEMBER 31, 2018 DECEMBER 31, 2017 NET OPENINGS CLOSINGS GEOX SHOPS of which DOS GEOX SHOPS of which DOS OPENINGS 286 143 304 137 (18) 5 ITALY ITALY (23) 285 154 310 155 EUROPE (25) 8 EUROPE (33) 37 37 42 NORTH AMERICA 42 (5) 2 NORTH AMERICA (7) 407 110 RoW* 439 105 RoW* (32) 42 (74) 1,095 TOTAL 1,015 444 TOTAL 439 (80) 57 (137) *I ncludes Under Distribution Agreement Shops (138 as of December 2018 vs 168 as of December 2017) which are shops opened under license by partners in the Middle East and in the Far East. Sales from these shops are not included in the franchising channel X STORE ROLL OUT PLAN UPDATE 136 X STORE AT THE END OF FY18 FROM 33 AT THE END OF FY17 7

FY18 RESULTS| SOCIAL MEDIA AND EDITORIALS INSTAGRAM EDITORIALS FACEBOOK  FOLLOWERS : > 210 k  TOT. EDITORIAL PAGES: +80%  FOLLOWERS: 1.5 MILLION ↑46 k (+30%) in the last 6 months  FULL PAGES: +50%  WEEKLY TOTAL REACH: 1.8 MILLION  POSTS: 405 in the last 6 months  COVER PAGES: +65% with an AVG number of Likes of  WEEKLY TOTAL IMPRESSIONS:3.7 MILLION 1.200 FIRST TIME IN FASHION  POSTS/3 MONTHS: 95 with an AVG number MAGAZINES LIKE  AVG REACH/POSTS: 103K of Likes of 1.400 WALLPAPER & VOGUE  AVG IMPRESSIONS: 1 MILLION a  AVG REACH/POSTS: 200 K FORMULA E GRANTED ALSO Week THE PRESENCE IN SPORT MAGAZINES AND NEWSPAPERS  AVG IMPRESSIONS/POSTS: 300 K  AVG ENGAGEMENT RATE Rate : (last 3 months) 0.68%  AVG DAILY NEW LIKES : 187 FIRST POSITIVE SIGNS ALSO FROM THE GEOX DRAGON INSTAGRAM PROFILE 8 *Data as of January 2019

FY18 RESULTS| INCOME STATEMENT (EURO MLN) FY18 IN % FY17 IN % CHG • NET SALES 827.2 100% 884.5 100% -6.5% GROSS MARGIN INCREASE (+170 BPS) MAINLY THANKS TO SPECIFIC MEASURES ON SUPPLY CHAIN EFFICIENCY AND TO CHANNEL MIX COST OF SALES (413.5) (50.0%) (456.9) (51.7%) -9.5% (HIGHER WEIGHT OF RETAIL SALES WHICH HAVE A HIGHER GROSS MARGIN) GROSS PROFIT 413.8 50.0% 427.6 48.3% -3.2% • SELLING & DISTRIBUTION (46.4) (5.6%) (47.3) (5.3%) -1.8% G&A TREND REFLECTED MAINLY THE HIGHER COSTS RELATED TO DOS PERIMETER INCREASE AND LOGISTICS G&A (325.5) (39.3%) (317.6) (35.9%) 2.5% • A&P UP BY EURO 4.1 MILLION TO SUPPORT SALES AND BRAND A&P (26.7) (3.2%) (22.6) (2.6%) 18.1% IMAGE EBIT ADJ 15.2 1.8% 40.2 4.5% -62.2% • SPECIAL ITEMS RELATED TO NETWORK OPTIMIZATION AND SPECIAL ITEMS (9.8) (1.2%) (10.0) (1.1%) -1.5% ORGANIZATIONAL REVIEW AT EURO 9.8 MILLION EBIT 5.4 0.6% 30.1 3.4% -82.2% • TAXES AT EURO 5.9 MILLION. IT IS IMPORTANT TO UNDERLINE THAT NET FINANCIAL EXPENSES THE GROUP DID NOT RECOGNIZE APPROX. 1.6 MILLION OF (4.8) (0.6%) (3.4) (0.4%) 41.3% DEFERRED TAX ASSETS FOR CERTAIN LOSS-MAKING SUBSIDIARIES EBT 0.6 0.1% 26.8 3.0% n.m. ABROAD WHICH CURRENTLY DO NOT SHOW SIGNS OF A FAST RECOVERY. INCOME TAXES (5.9) (0.7%) (11.4) (1.3%) -48.5% • 42.5% - TAX RATE n.m. - - NET RESULT ADJUSTED FOR SPECIAL ITEMS AT EURO 2 MILLION 15.4 1.7% NET RESULT (5.3) (0.6%) n.m. EBITDA 38.3 4.6% 64.0 7.2% EBITDA ADJ 48.2 5.8% 74.0 8.4% 9

FY18 RESULTS| BALANCE SHEET (EURO MLN) DEC 18 DEC 17 CHG INTANGIBLE ASSETS 50.2 52.1 (1.9) TANGIBLE ASSETS 65.8 61.3 4.5 OTHER FIXED ASSETS, NET 39.1 42.6 (3.5) TOTAL FIXED ASSETS 155.1 156.0 (0.9) OPERATING WORKING CAPITAL 209.1 226.3 (17.2) CONFIRMED THE SOLID POSITION OF THE GROUP: OTHER CURRENT ASSETS (17.7) (19.6) 1.9 (LIABILITIES), NET POSITIVE NET FINANCIAL POSITION INVESTED CAPITAL 346.5 362.7 (16.2) EQUITY AT EURO 341 MILLION EURO, EQUAL TO 98% OF THE INVESTED CAPITAL NET FINANCIAL POSITION (CASH) (2.3) 5.4 (7.7) STAFF SEVERANCE AND RISK 8.1 7.8 0.3 FUND SHAREHOLDERS’EQUITY 340.8 349.5 (8.7) INVESTED CAPITAL 346.5 362.7 (16.2) 10