P R E S E N T A T I O N WARSAW, 17 TH MAY 2017 Disclaimer This is - - PowerPoint PPT Presentation

SLIDE 1

1 Q 1 7 F I N A N C I A L R E S U L T S P R E S E N T A T I O N

WARSAW, 17 TH MAY 2017

SLIDE 2

2

G L O B A L A S P I R A T I O N S

Disclaimer

This is presentatio ion (t (the “Presentation”) was was prepared by by LPP SA SA (t (the “Company”) wit ith a due care. Stil ill, it it may contain in certain inconsis istencie ies or

• r omis
• issions. The Presentation does not contain

in a complete or

• r thorough financial analysis

is of

• f the Company

and does not not present it its standing or

• r prospect

cts in in a comprehensive or

• r in

in-depth manner. Therefore, anyone who in intends to to make an an investment decis ision wit ith respect ct to to the Company should rely on

• n the information dis

isclosed in in the offic icial reports

• f
• f the Company, published in

in accordance wit ith the laws applic icable to to the Company. This is Presentatio ion was prepared for informatio ion purp urposes on

• nly and

nd doe

• es not

not co constit itute an an off

• ffer to

to buy uy or

• r to

to sel sell any fin financial instruments ts. The Presentatio ion may contain in 'forward‐looking statements'. However, such statements cannot be be treated as as assurances or

• r

projections of

• f any exp

xpected future result lts of

• f the Company. Any statements concernin

ing expectations of

• f future financial

results cannot be be understood as as guarantees that any such results wil ill actually be be achieved in in future. The expectatio ions of

• f

the Management Board are based on

• n their

ir current knowledge and depend on

• n many factors due to

to whic ich the actual results achieved by by the Company may dif iffer materially from the results presented in in this is document. Many of

• f those factors are

bey eyond th the aw awareness an and co contr trol of

• f th

the Co Company or

• r th

the Company’s ab abil ility to to fo foresee th them. Neit ither the Company, nor it its dir irectors, offic icers, advis isors, nor representativ ives of

• f any such persons are lia

iable on

• n account of
• f

any reason resulting from any use of

• f this

is Presentatio

• ion. Addit

itionally, no no information contained in in this is Presentation constit itutes any representation or

• r warranty of
• f the Company, it

its offic icers or

• r dir

irectors, advis isors or

• r representatives of
• f any of
• f

the above persons. The Presentatio ion and the forward‐looking statements speak only as as at at the date of

• f this

is Presentation. These may not not be be indic icativ ive of

• f results or
• r developments in

in future periods. The Company does not undertake any obligatio ion to to revie iew, to to confir irm or

• r to

to release public icly any revis isions to to any forward‐looking st statements to to reflect events that occur

• ccur or
• r

ci circumstances th that aris ise after th the date te of

• f th

this is Presentation.

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3

G L O B A L A S P I R A T I O N S

1 2

3 1Q17 financial results Key corporate events 2017 outlook

SLIDE 4

4

G L O B A L A S P I R A T I O N S

Almost PLN 1.4bn revenues in 1Q17

18

COUNTRIES

1,671

STORES

+6.9%

m2

+4.6%

LFLs

+100%

E-COMMERCE

+16%

REVENUES

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5

G L O B A L A S P I R A T I O N S

Sales network optimisation

18 @ 987 @ 80 @ 58 @ 72 298 28 12 17 16 @ 26 19 34 @ 31.03.2017

• No. stores

YoY LPP GROUP 1,671 +30 Reserved 455 +7 Cropp 376 +1 House 321

• 1

Mohito 285 +4 Sinsay 198 +26 Tallinder

• 6

Outlety 36

• 1

@ Int nternet t store xx xx Numbe ber of

• f traditi

tional l stores 1 1 1 2 1

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6

G L O B A L A S P I R A T I O N S 1.7 12.4 18.0 27.4 54.9 1Q13 1Q14 1Q15 1Q16 1Q17

+636% YoY +45% YoY +53% YoY

LFL and e-commerce growth

• LF

LFLs Ls wer ere posit itive in ea each mo month in 1Q

• 1Q17. All

ll brands sho showed posit itive LF LFLs Ls in 1Q 1Q17.

• 1Q

1Q17 LFL LFLs wer ere in n th the e bla lack in n all ll co countries (th the hi highest gr growth rates were rec ecorded in Bu Bulgaria, Hu Hungary, , Uk Ukraine and nd Cz Czech Rep Republic).

• On

On-line sa sales amounted to to c. c.6% revenues in n Pol

• land and 4%

4% of

• f group revenues in

n 1Q 1Q17.

• Pick-up in e-commerce dyn

ynamics due ue to to investments in n int nternet t and nd mo mobile sto stores of

• f all

ll brands and nd dev evelopment t of

• f

stor stores ou

• uts

tside Pol

• land.

.

• 0.8%

1.5%

• 1.5%

2.8% 4.2% 6.6% 9.2% 5.1% 4.6% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

+100% YoY

ON ON-LI LINE SA SALE LES

(PLN LN m) m)

LF LFL L DYN DYNAMICS

(lo local cu currencies)

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7

G L O B A L A S P I R A T I O N S

Growths in all brands

• Dynamic Res

Reserved 1Q 1Q17 revenue gr growth res esulted fr from: flo floorspace dev evelopment (Germany and and Ru Russ ssia) as as well as as mo more fa favourable rec eceptio ion of

• f LP

LPP brands’ co coll llectio ions by y cu cust stomers.

• Double-dig

igit t LFL LFLs in n Moh

• hito in 1Q1

1Q17 – th the e brand’s rev evenues were sim similar to to th thos

• se of
• f Cr

Cropp brand. .

• Sinsay’s floorspace and revenues grew at a higher pace than those of other LPP’s brands, due to development in Poland

and nd abroad.

+ 13%YoY + 23% YoY + 10% YoY + 14% YoY + 27% YoY + 100% YoY

ths m2 1Q16 1Q17 YoY

LPP GR GROUP 855.0 913.9 6.9% Res Reserved 467.1 510.7 9.3% Cropp 115.4 120.1 4.1% House 100.5 102.9 2.4% Mohito 94.9 97.8 3.1% Sinsay 60.5 69.8 15.4% Tallinder 2.9 0.0

• 100.0%

Ou Outlets 13.8 12.6

• 8.6%

REV REVENUES BY BY BR BRANDS

(PLN LN m)

1Q 1Q17 FL FLOORSPACE

(by brands)

50 55 112 159 184 189 614 Other E-commerce Sinsay House Mohito Cropp Reserved

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8

G L O B A L A S P I R A T I O N S

Growths in key regions

• Dynamic flo

floorspace gr growth in Eu Europe in 1Q 1Q17 due to to dev evelopment in Ger Germany.

• CI

CIS flo floorspace acc cceleration co contin inued, ye yet t th there were no no ne new op

• penings in th

the ME E in 1Q 1Q17.

• The

The hi highest t rev evenue gro growth rates among reg egions wer ere rec ecorded by y th the e CI CIS co countries, due ue to to rub ubble appreciatio ion against t PLN LN.

• Among co

countries, th the hi highest t no nominal revenue gro growth was rec ecorded in n Ru Russia and Pola

• land.

REV REVENUES BY BY REG REGIONS

(PLN LN m) m)

1Q 1Q17 FL FLOORSPACE

(by reg egions)

ths m2 1Q16 1Q17 YoY LPP GROUP

855.0 913.9 6.9%

Po Pola land

468.3 485.3 3.6%

Eur Europe

184.4 212.8 15.4%

CIS

194.7 208.2 6.9%

ME ME

7.6 7.6 0.0% + 6% YoY + 39% YoY + 24% YoY

• 19% YoY

8 282 324 749 ME Europe CIS Poland

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9

G L O B A L A S P I R A T I O N S

6.1% 9.0% 2.2% 12.1% 17.2% 16.4% 18.0% 17.8% 16.0% 0% 5% 10% 15% 20% 500 1,000 1,500 2,000 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 Retail sales (brands) E-commerce Other (incl. outlets) Revenue growth

Acceleration of sales/ m2 growth

• Gr

Group revenues gr grew 16% 16% YoY in 1Q 1Q17 due e to to hig igher flo floorspace, , posit itive LF LFLs Ls an and hig igh e-commerce gr growth.

• In

n 1Q 1Q17 bot

• th gr

group revenues/ m2 m2 and nd ret etail sa sales/ m2 m2 were hi higher YoY

• Y.
• Double-dig

igit t ret etail sa sales/ m2 m2 wer ere rec ecorded in n 1Q 1Q17 in n Cz Czech Rep Republic, Hu Hungary, Ro Romania and Ru Russia.

GROUP REV REVENUES

(PLN LN m) m)

REV REVENUES/ / M2

PLN (monthly) 1Q16 1Q17 YoY LPP GROUP (ret etail) 449 449 492 492 9. 9.5% Po Pola land 491 491 500 500 2. 2.0% Eur Europe 418 418 451 451 8. 8.0% CIS 390 390 514 514 31. 31.8% LPP GROUP 468 468 499 499 6. 6.7% 7%

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10

G L O B A L A S P I R A T I O N S

178 168 280 309 Jan-17 Feb-17 Mar-17 Apr-17

Gross profit margin stabilisation

• 1Q

1Q17 YoY gr gross profit t ma margin stab stabil ilisation, due to to intr troductio ion of f new ew inventory ma management polic icy an and improved co coll llectio ions.

• The

The aim im of

• f th

the e cu current inventory management t pol

• lic

icy is s to to sel sell goo goods to to a ma maximum exte extent t in n stor stores to to avoid th the e co cost sts of

• f

th their ret eturn and tr transport to to post

• st-season warehouse.
• The

The ne new pol

• lic

icy res esults in n si sizeable gro gross profit ma margin difference betw etween mo months: 37% 37% (-7 p.p.) ) in January 201 2017, 44% 44% (-3 p.p. YoY) in Fe February, but t 60% 60% (+8 +8 p.p. YoY) in Marc arch an and 59% 59% (+8 +8 p.p. YoY) in April il 201 2017.

QU QUARTE TERLY Y GROSS PR PROFIT IT MAR ARGIN IN MON ONTHLY Y GROSS PRO PROFIT IT ON ON SA SALE LES

(PLN LN m) m)

54.2% 52.1% 52.6% 54.8% 46.1% 49.9% 47.1% 50.8% 45.6% 40% 45% 50% 55% 60% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

NEW INVENTORY MA MANAGEMENT POL POLIC ICY + 2% YoY + 5% YoY + 30% YoY + 28% YoY

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11

G L O B A L A S P I R A T I O N S 236 230 232 244 237 254 254 258 266 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

Higher costs/ m2

• Gr

Growth in ren ental ch charges  si sizeable openings in Ger Germany, dep epreciation of f zlo zloty ver versus eu euro an and rubble.

• Pick-up in per

ersonnel co costs sts  gro growth in n sa salaries acr cross all ll co countries. .

• Hi

Higher YoY ot

• ther co

costs ts of

• f stor

stores  hi higher usa usage of

• f ma

materials due ue to to si sizeable op

• penings in Ge

Germany. .

• Gr

Growth in n SG& G&A/ m2 m2  hi higher co costs sts of

• f he

headquarters (development of

• f prod
• duct

t divisions, fur further e-commerce dev evelopment) ) and nd hi higher co costs sts of

• f stor

stores.

CO COSTS OF OF OW OWN STO STORES/ M2 SG SG&A COS COSTS/ / M2 M2

+12% YoY +12% YoY

93 93 90 89 93 98 99 89 98 50 48 47 52 52 56 57 59 63 46 47 48 55 46 48 49 53 53 189 187 186 195 191 202 205 201 214

1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

Rental costs HR costs Other costs

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12

G L O B A L A S P I R A T I O N S

Seasonally weaker 1Q17

PLN m 1Q16 1Q17 YoY Revenues 1,174.8 1,362.3 16.0% Gross profi fit margin 46. 46.1% 45. 45.6%

• 0.

0.5 p.p. SG&A cos

• sts

595. 595.3 719. 719.2 20. 20.8% EBIT

• 63.9
• 109.0

n/m EB EBIT margin

• 5.

5.4%

• 8.

8.0%

• 2.

2.6 p.p. Net profit

• 65.6
• 117.0

n/m

• Dynamic gro

group rev evenue gro growth:

• pos
• sitive LFLs and

nd floo

• orspace growth,

,

• n
• n-li

line sale les incr ncrease.

• Gross profit

it margin stabil ilis isatio ion, due to to introductio ion of

• f

new inventory management polic icy and improved co coll llectio ions.

• SG&A growth higher than top-lin

ine growth – low cost bas ase of

• f 1Q16

16.

• Lo

Lower ne net fin financing co costs sts:

• low
• wer int

nterest and nd fee ees (lower inde ndebtedn dness),

• des

espite low

• wer FX gains.
• EBIT and bottom-line below zero due to

to SG&A costs rising fa faster th than gr gross profit on

• n sa

sales.

SLIDE 13

13

G L O B A L A S P I R A T I O N S

Freeing up working capital

• YoY fal

fall in inventory and and inventory/ m2 m2 due to to new inventory management t polic icy and and im improved rec eceptio ion of f co collectio ions by y cu cust stomers.

• Hi

Higher YoY rec eceivables due ue to to sa sale of

• f ob
• bso

solete inventory at t th the e en end of

• f 201

2016.

• PLN

LN 80 80m addit itio ional li liabilitie ies due ue to to exte extension of

• f payment

t ter terms fo for sup suppliers.

• Our

ur aim im is s to to ma match lia liabil ilities to to th the e inventory lev level.

INVE INVENTORY WOR ORKING CA CAPI PITAL

(PLN LN m) m)

PLN 770m PLN 370m

1,131 1,167 1,336 1,320 1,374 1,444 1,438 1,164 1,251 1,516 1,507 1,684 1,575 1,621 1,669 1,634 1,275 1,381 400 800 1,200 1,600 400 800 1,200 1,600 2,000 Inventory (PLN m) Inventory/ m2 (PLN)

1,374 1,251 110 155 604 882 1Q16 1Q16 1Q17 1Q17 Inventory Receivables Liabilities

SLIDE 14

14

G L O B A L A S P I R A T I O N S

• 122
• 156
• 120
• 224
• 145
• 219
• 266
• 366
• 280

201 183 320 284 268 240 224 195 182 636 556 586 561 712 619 689 315 446 0.0 0.5 1.0 1.5

• 600
• 300

300 600 900 1,200 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 Cash and equivalents Long-term debt Short-term debt Net debt/ EBITDA 4Q (x)

Lower indebtedness

• 1Q

1Q17 cap capex gre grew 212 212% YoY due ue to to sh shif ift in payments fo for sto stores op

• pened in

n 4Q 4Q16 to to 1Q 1Q17, alo long wit ith ext extending ter terms

• f
• f payments by

y co construction co companies.

• YoY
• Y fa

fall in n sho short-term deb ebt t due ue to to mo more fa favourable op

• perating cas

cash flo flows in n 4Q 4Q16 and 1Q 1Q17.

• Ne

Net deb ebt/ t/ EB EBITDA ratio io fel fell fr from 1. 1.3x 3x in 1Q 1Q16 to to 0. 0.8x x in 1Q

• 1Q17. Our

ur aim im is s to to ke keep th the ratio io on

• n a sa

safe lev level.

NET ET DEB DEBT VS VS NET ET DEB DEBT/EBIT ITDA

(PLN LN m) m)

CAP CAPEX

(PLN LN m) m) PLN 36m PLN 112m

0.9x 0.8x 1.1x 0.9x 1.3x 1.0x 1.2x 0.3x 0.8x

27 78 51 74 99 1Q16 2Q16 3Q16 4Q16 1Q17 Stores Other

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15

G L O B A L A S P I R A T I O N S

1Q17 executive summary

On-line sales acceleration.

1

Sales network optimisation.

2

Gross profit margin stable YoY.

3

Fall in net debt.

5

Net working capital improvement.

4

SLIDE 16

16

G L O B A L A S P I R A T I O N S

1 2

3 1Q17 financial results Key corporate events 2017 outlook

SLIDE 17

17

G L O B A L A S P I R A T I O N S

Key corporate events

REFRESHED SHOWROOM

Upg pgraded d Sho howroom in n Warsaw for all LPP’s brands.

RESERVED IN HAMBURG AND COLOGNE

17t 17th and nd 18t 18th store in n Ger ermany, , hi high gh-stree eet flagships. .

5, 5,70 700 m2

m2

FIRST STORES IN BELARUS

Res eserved, , Cropp and nd Hou

• use

franchise stores in n Mi Minsk sho hopp pping mall ll. .

2, 2,70 700 m2

m2

ANOTHER CSR STEP

Co Co-ope peration n with th SGS, an n int nternational l audi udito tor, , in n frames of

• f work
• rking con
• nditions.

February 2017 April 2017 April 2017 January/ Feb. 2017

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18

G L O B A L A S P I R A T I O N S

Strengthening the designing teams

DES DESIGN CEN CENTRES IN IN TOP TOP3 CITIE CITIES IN IN POL POLAND. . WAR ARSAW

• A ne

new des esig ign cen centre res esponsible for for Res Reserved.

• Up

Upgraded Showroom of

• f all

ll brands.

GDANSK

• LPP’s largest design cen

centre. .

• The

The ce centre is s res esponsible fo for Res Reserved, Cr Cropp an and Sin Sinsay brands.

CR CRACOW

• Des

esign ce centre fo for House and and Mohit ito brands.

• Co

Co-operation with des esig igning sch schools.

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19

G L O B A L A S P I R A T I O N S

New Reserved German openings

• In

n 1Q 1Q17 2 Res Reserved sto stores were opened at at hig igh-streets of f 2 2 Ge German ci citie ies: Ha Hamburg and nd Co Cologne.

• Flo

Floorspace: 5, 5,700 m2 m2.

• Be

Berlin ci city-centr tre fla flagship to to be e op

• pened in May 201

2017. .

• 20t

20th Res Reserved stor store in Ger Germany to to be e op

• pened in

n Fr Frankfurt am Main in in 4Q 4Q18.

`

Germany was LPP’s fifth largest market in 2016.

Berlin May 2017 Frankfurt am Main, 4Q18

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20

G L O B A L A S P I R A T I O N S

First franchise stores in Belarus

• April

il 201 2017: Bel Belarus beco ecomes LPP’s 19 19th

th ma

market. t.

• Be

Belarus dev evelopment t co conducted via via fra franchise stor stores:

• lack

ck of

• f op
• per

erating cos

• sts,
• no capex on LPP’s side.
• Fir

First t stor stores of

• f Res

Reserved, Cr Cropp and nd Ho House in n Minsk sho shopping ma mall.

• Co

Combin ined flo floorspace of

• f th

those 3 3 sto stores reaches 2,

2,700 700 m2

m2.

• Local franchisees’ diversification:
• Res

Reserved d is deve veloped via Ra Rapa Group,

• Cropp

p and nd Hou

• use are

e dev evelo loped by y TDM TDM Impo port. t.

• Ta

Target: : 3 3 stor stores of

• f Res

Reserved, Cr Cropp and nd Ho House in n Be Belarus in tw two ye years.

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21

G L O B A L A S P I R A T I O N S

Improved safety conditions in Asia

PLN 16m ou

• utl

tlays for for audits its of

• f wor
• rking co

condit itions in Ba Bangladesh fa factories:

• 2/3

/3 of the e amo mount for working conditions s audit was s spen pent for on

• n-site inspections

s and audits s of working conditions s in factories,

• the

e rema emaining amo mount comprises s of memb membership fee ees s for ACCORD and Ra Rana Plaza Trust st Fun Fund.

80 factories 21 people PLN 16m

80 factories un under ACCORD co control:

• 90% of factories had thei

eir el elec ectrical inst stallations mo modernise sed or changed,

• 75% of factories en

ended up p with additional anti anti-fire alarms and inst stallations,

• 60% of factories had thei

eir const structions strengthened. In ma many case ses the e pr production was s transf sferred to other ven enues. s.

21 people ful full-time emp employed in n Ba Bangladesh of

• ffices and

nd Aud udit it Dep epartment t in n HQ HQs.

In 2017 apart from audits of LPP’s own inspectors, LPP wil ill l co co-operate wit ith SGS, an an int international al au audi ditor, , to to additionally verify whether LPP’s suppliers follow its its Cod Code of

• f Con

Conduct.

SLIDE 22

22

G L O B A L A S P I R A T I O N S

1 2

3 1Q17 financial results Key corporate events 2017 outlook

SLIDE 23

23

G L O B A L A S P I R A T I O N S

Double-digit 2017 floorspace growth

• 11%

11% YoY flo floorspace gr growth in 201 2017.

• Res

Reserved sto stores sho should be e in n 22 22 co countr tries at t th the e en end

• f
• f 201
• 2017. 4

4 ne new co countries in n 201 2017 en encompass:

• Ser

erbi bia and nd the e UK (own stores),

• Bel

elarus and nd Kazakhstan (fr franchise stores).

• 201

2017 tar targets ts:

• CEE

EE dev evel elopm pment, ,

• CIS acc

ccele leration,

• SEE

EE acc ccele leration (es especially lly in n Romania, , ent ntry to

• Ser

erbi bia), ,

• new

new stores in n WE E (Germany and nd the he UK).

• Pla

lanned 201 2017 cap capex at t c.

• c. PLN

LN 430 430m, up up c.

• c. 60%

60% YoY

• Y

due ue to to fa faster flo floorspace gr growth (planned sto store cap capex x at t PLN LN 370 370m) ) and nd HQ HQs ou

• utlays (PLN

LN 60 60m).

Floorspace (ths m2) 2016 2017 former target 2017 target YoY BY BRANDS Res eserved 509. 509.1 578. 578.1 578. 578.4 14% 14% Cropp 120. 120.4 131. 131.5 129. 129.0 7% 7% Hou

• use

105. 105.7 114. 114.3 112. 112.2 6% 6% Mo Mohi hito 99. 99.1 105. 105.2 102. 102.1 3% 3% Sinsay 69. 69.8 87. 87.8 89. 89.5 28% 28% Ta Talli linder 4. 4.1 0. 0.0 0. 0.0

• 100

100% Out Outle lets 12. 12.6 11. 11.8 11. 11.6

• 7%

7% BY REGIONS Po Pola land 496. 496.6 517. 517.5 513. 513.2 3% 3% Eur Europe 209. 209.5 250. 250.9 251. 251.0 20% 20% CIS 207. 207.0 249. 249.3 250. 250.5 21% 21% ME ME 7. 7.6 10. 10.9 8. 8.2 8% 8% TOTAL 920.7 1,028.6 1,022.9 11%

SLIDE 24

24

G L O B A L A S P I R A T I O N S

Triple-digit e-commerce revenue growth in 2017

2020 TARGET- INTERNET SHOULD CONSTITUTE 7-8% OF GROUP SALES

4Q 4Q16 STA STATUS 2H 2H17 PLA PLANS 1H 1H17 PLA PLANS

On On-line st stores of

• f 5

5 br brands in in Pol Polan and, Czec Czech Rep Rep., ., Sl Slovak akia, , Hun ungar ary, Rom Roman ania an and d Germ rmany. On On-li line sto tores of

• f 5

5 bra brands in in Lit Lithuan ania, La Latv tvia an and d Esto Estonia ia. On On-line st stores of

• f 5

5 br brands in in Ru Russia ia an and d Ukra kraine. . Res Reserved on

• n-line in

in the the UK (be befo fore Lo Lond ndon flag agship ip lau aunch)

SLIDE 25

25

G L O B A L A S P I R A T I O N S

2017 outlook

• Reve

Revenue grow growth sho hould ld exce xceed floo

• orspace gro

growth (positive LF LFLs Ls at at all all bra brands). .

• Pi

Pick ck-up in in gro gross pro rofi fit mar argin ver versus 201 2016 level

• vel. Esti

Estimated 201 2017 gro group gro gross pro rofi fit mar argin at at 52- 53%.

• Inde

Indebtedness at at a a low

• w level

vel, , am amon

• ng
• the
• thers du

due to to fur urther ne net t work

• rking

cap capital im improvements.

• Dy

Dynam amic e-com commerce de devel velopment (6 6 ne new mark rkets on

• n-line).

).

• LF

LFLs Ls im improvement.

• Ba

Ban n on

• n trad

trade on

• n Sun

Sundays (19 19% of

• f

Pol Polish tur turnover). ).

• Unf

nfav avourab able le FX FX tren trends on

• n US$

S$, , EU EUR an and d RU RUB aga again inst PLN. PLN.

2 0 1 7 T A R G E T S O P P O R T U N I T I E S R I S K S

SLIDE 26

26

G L O B A L A S P I R A T I O N S

Growing dividend payments

• The

The Sup Supervisory Bo Board ap approved th the e Man anagement t Bo Board rec ecommendation to to pay ay out PLN LN 65. 65.6m in dividend fr from 201 2016 ea earnings.

• The

The proposed dividend is s 10% 10% hi higher Yo YoY and nd co cons nstitutes 38% 38% of

• f gro

group 201 2016 ne net inc ncome.

• The

The proposal tr translates int nto DPS of

• f PLN

LN 36.

• 36. If

f 13,1 13,132 warrants are co converted int nto sha shares bef efore dividend day, y, DPS wil ill fa fall to to PLN LN 35.7 35.74.

DIV DIVIDENDS VS VS NET ET EAR EARNINGS

(PLN LN m) m)

Dividend shown under the year from which it is paid, not under the year, in which it is paid out.

• 50% YoY

+10% YoY

Dividend day:

4 September 2017

Payment day:

20 September 2017

480 351 175 58 60 66 2014 2015 2016 2014 2015 2016 Group NI Dividends

SLIDE 27

27

G L O B A L A S P I R A T I O N S

Q&A

SLIDE 28

28

G L O B A L A S P I R A T I O N S

Back-up

SLIDE 29

29

G L O B A L A S P I R A T I O N S

Network development

Floorspace (ths m2) 31.03.2015 30.06.2015 30.09.2015 31.12.2015 31.03.2016 30.06.2016 30.09.2016 31.12.2016 31.03.2017 Reserved 402.7 416.3 435.7 461.3 467.1 473.8 487.2 509.1 510.7 Pol

• land

215.2 219.0 223.4 232.5 230.9 235.1 232.0 248.7 245.9 Europe 90.1 90.1 95.1 95.1 106.5 120.2 124.0 127.2 140.0 144.1 147.7 CIS 95.8 95.8 98.3 98.3 100.4 103.1 104.6 103.9 107.7 108.7 109.5 ME ME 1.5 1.5 3.9 3.9 5.5 5.5 5.5 5.5 7.6 7.6 7.6 7.6 7.6 7.6 7.6 7.6 7.6 7.6 Cropp 106.6 111.5 109.1 114.5 115.4 117.8 116.7 120.4 120.1 Pol

• land

58.5 58.5 62.8 62.8 59.6 59.6 63.0 63.0 63.6 63.6 65.2 65.2 63.0 63.0 65.3 65.3 65.1 65.1 Europe 17.8 17.8 18.7 18.7 19.1 19.1 19.8 19.8 20.2 20.2 20.6 20.6 21.0 21.0 21.2 21.2 21.0 21.0 CIS 30.2 30.2 30.0 30.0 30.4 30.4 31.7 31.7 31.6 31.6 31.9 31.9 32.8 32.8 34.0 34.0 34.0 34.0 House 89.9 96.7 95.2 99.7 100.5 104.8 103.8 105.7 102.9 Pol

• land

56.2 56.2 62.4 62.4 59.3 59.3 62.2 62.2 62.9 62.9 65.4 65.4 63.1 63.1 64.9 64.9 62.4 62.4 Europe 12.7 12.7 13.2 13.2 14.4 14.4 15.1 15.1 15.5 15.5 16.4 16.4 16.8 16.8 16.4 16.4 16.2 16.2 CIS 21.0 21.0 21.1 21.1 21.6 21.6 22.4 22.4 22.0 22.0 23.1 23.1 23.9 23.9 24.3 24.3 24.3 24.3 Mohito 86.4 89.1 90.3 94.5 94.9 95.9 97.6 99.1 97.8 Pol

• land

47.8 47.8 49.2 49.2 49.7 49.7 52.1 52.1 52.5 52.5 51.8 51.8 52.4 52.4 53.4 53.4 51.7 51.7 Europe 13.6 13.6 14.5 14.5 15.2 15.2 16.1 16.1 16.5 16.5 17.7 17.7 18.1 18.1 18.1 18.1 18.1 18.1 CIS 25.0 25.0 25.4 25.4 25.4 25.4 26.2 26.2 25.9 25.9 26.3 26.3 27.1 27.1 27.7 27.7 28.0 28.0 Sinsay 48.4 52.4 54.8 59.7 60.5 63.1 65.2 69.8 69.8 Pol

• land

35.5 35.5 38.6 38.6 40.3 40.3 43.5 43.5 43.9 43.9 44.5 44.5 45.5 45.5 48.6 48.6 48.6 48.6 Europe 5.4 5.4 6.3 6.3 6.6 6.6 7.6 7.6 8.0 8.0 8.8 8.8 9.2 9.2 9.7 9.7 9.7 9.7 CIS 7.6 7.6 7.6 7.6 7.9 7.9 8.6 8.6 8.6 8.6 9.8 9.8 10.5 10.5 11.5 11.5 11.5 11.5 Tallinder (Poland only) 0.0 0.0 0.0 0.0 2.9 3.7 3.7 4.1 0.0 Outlets 11.8 12.4 13.6 13.8 13.8 13.8 13.8 12.6 12.6 Total by regions Pol

• land

423.5 443.5 443.9 465.0 468.3 477.4 471.2 496.6 485.3 Europe 139.6 147.7 161.7 179.0 184.4 190.8 205.2 209.5 212.8 CIS 181.2 183.2 187.7 193.9 194.7 196.9 204.0 207.0 208.2 ME ME 1.5 1.5 3.9 3.9 5.5 5.5 5.5 5.5 7.6 7.6 7.6 7.6 7.6 7.6 7.6 7.6 7.6 7.6 TOTAL 745.8 778.4 798.8 843.5 855.0 872.7 888.0 920.7 913.9

SLIDE 30

30

G L O B A L A S P I R A T I O N S

2017 network development details

FLOORSPACE (ths m2) 31.12.2016 2017 TARGET

• Nom. growth

YoY Reserved 509.1 578.4 69.3 14% Pola land 24 248.7 26 265.5 16 16.8 7% Eu Europe pe 14 144.1 17 173.5 29 29.4 20% 20% CIS 10 108.7 13 131.3 22 22.6 21% 21% ME ME 7. 7.6 8. 8.2 0. 0.6 8% 8% Cropp 120.4 129.0 8.6 7% Pola land 65 65.3 66 66.2 0. 0.9 1% Eu Europe pe 21 21.2 23 23.6 2. 2.4 11% 11% CIS 34 34.0 39 39.3 5. 5.3 16% 16% House 105.7 112.2 6.5 6% Pola land 64 64.9 64 64.7

• 0.

0.3 0% Eu Europe pe 16 16.4 17 17.5 1. 1.1 7% 7% CIS 24. 24.3 30. 30.0 5. 5.7 23% 23% Mohito 99.1 102.1 3.0 3% Pola land 53 53.4 51 51.9

• 1.

1.5

• 3%

3% Eu Europe pe 18 18.1 20 20.4 2. 2.4 13% 13% CIS 27 27.7 29 29.8 2. 2.1 8% 8% Sinsay 69.8 89.5 19.7 28% Pola land 48 48.6 54 54.6 6. 6.1 12% 12% Eu Europe pe 9. 9.7 15 15.8 6. 6.1 63% 63% CIS 11 11.5 19 19.1 7. 7.5 65% 65% Tallinder 4.1 0.0

• 4.1
• 100%

Pola land 4. 4.1 0. 0.0

• 4.

4.1

• 10

100% Eu Europe pe 0. 0.0 0. 0.0 0. 0.0 0% 0% CIS 0. 0.0 0. 0.0 0. 0.0 0% 0% Outlets 12.6 11.6

• 1.0
• 7%

Pola land 11 11.6 10 10.3

• 1.

1.3

• 11

11% Eu Europe pe 0. 0.2 0. 0.2 0. 0.0 0% 0% CIS 0. 0.8 1. 1.1 0. 0.3 45% 45% TOTAL 920.7 1,022.9 102.2 11% NUMBER OF STORES 31.12.2016 2017 TARGET

• Nom. growth

YoY Reserved 461 468 7 2% Pola land 23 236 22 227

• 9
• 4%

4% Eu Europe pe 11 116 12 122 6 5% CIS 10 103 11 112 9 9% ME ME 6 7 1 17% 17% Cropp 379 385 6 2% Pola land 21 219 21 213

• 6
• 3%

3% Eu Europe pe 68 68 71 71 3 4% 4% CIS 92 92 10 101 9 10% 10% House 330 336 6 2% Pola land 21 212 20 205

• 7
• 3%

3% Eu Europe pe 51 51 52 52 1 2% 2% CIS 67 67 79 79 12 12 18% 18% Mohito 290 287

• 3
• 1%

Pola land 16 166 15 155

• 11

11

• 7%

7% Eu Europe pe 57 57 54 54

• 3
• 5%

5% CIS 67 67 78 78 11 11 16% 16% Sinsay 198 246 48 24% Pola land 14 142 15 155 13 13 9% 9% Eu Europe pe 26 26 42 42 16 16 62% 62% CIS 30 30 49 49 19 19 63% 63% Tallinder 9

• 9
• 100%

Pola land 9

• 9
• 10

100% Eu Europe pe 0% 0% CIS 0% 0% Outlets 36 34

• 2
• 6%

Pola land 33 33 30 30

• 3
• 9%

9% Eu Europe pe 1 1 0% 0% CIS 2 3 1 50% 50% TOTAL 1 703 1 756 53 3%

SLIDE 31

31

G L O B A L A S P I R A T I O N S

Changes in 1Q17 floorspace

• Res

Reserved dev evelopment in 1Q 1Q17 res esulted fr from: (1) ) new ew openings in Ge Germany (2 2 sto stores, 5. 5.7 7 th ths m2 m2) ) and and (2) ) fla flagship sto store in Mos

• scow (Russia).

).

• Opti

timisation of

• f flo

floorspace in Pola

• land:

: res esignatio ion fr from sm small sto stores (especia ially th thos

• se of
• f Res

Reserved and nd Ho House brands) ) who hose ren ental agreements ts exp expir ired in 1Q 1Q17.

• Clo

Closing of

• f Ta

Tallinder brand stor stores in n Feb February 201 2017.

CHA CHANGE IN IN FL FLOORSPACE BY BY BR BRANDS

(th ths m2 m2)

CHA CHANGE IN IN FL FLOORSPACE BY BY REG REGIONS

(th ths m2 m2) 920.7

• 0.4

+1.7 0.0

• 1.3
• 2.7
• 4.1

913.9 0.0 913.9 920.7

• 11.3

+3.3 +1.2 0.0

• 6.8 ths m2
• 6.8 ths m2

SLIDE 32

32

G L O B A L A S P I R A T I O N S

1Q16 Poland Europe CIS ME 1Q17

1Q17 revenue growth contributors

PLN m 1Q16 1Q17 YoY LPP GROUP 1,174.8 1,362.3 16.0% Res eserved PL PL 288. 288.1 295. 295.9 2. 2.7% Res eserved EX EX 249. 249.6 318. 318.4 27. 27.6% Cropp PL PL 96. 96.2 93. 93.8

• 2.

2.5% Cropp EX EX 71. 71.2 94. 94.7 33. 33.0% Hou

• use PL

PL 101. 101.0 101. 101.6 0. 0.6% Hou

• use EX

EX 43. 43.1 56. 56.9 31. 31.9% Mo Mohi hito PL PL 86. 86.1 95. 95.2 10. 10.6% Mohi Mohito EX EX 63. 63.5 88. 88.4 39. 39.4% Sinsay PL PL 68. 68.2 81. 81.4 19. 19.4% Sinsay EX EX 20. 20.0 30. 30.8 54. 54.0% E-co commerce 27. 27.4 54. 54.9 100. 100.1% Ot Other er 60. 60.4 50. 50.2

• 16.

16.9%

PLN m

1,362 1,175 +77 +21 +14 +34

PLN m

1,362 1,175

+44 +55 +91

• 2

+27

• 10

+24

REV REVENUE GROWTH BY BY REG REGIONS REV REVENUE GROWTH BY BY BR BRANDS

SLIDE 33

33

G L O B A L A S P I R A T I O N S

49 53 60 271 749 Germany Ukraine Czech Rep. Russia Poland

Revenue and COGS split

1Q1 1Q17 REV REVENUES BY BY REG REGIONS (PLN LN m) m) 1Q 1Q17 PUR URCHASES BY BY REG REGIONS (PLN LN m) m) TO TOP5 REV REVENUES BY BY CO COUNTRIES (PLN LN m) m)

Poland remains our most important market.

Poland 55% Europe 21% CIS 24% ME 0% China 52% Far East 39% Turkey 6% Poland 2% Other 2%

SLIDE 34

34

G L O B A L A S P I R A T I O N S

Costs of stores and HQs

• Co

Costs of f sto stores en encompass co cost sts of f own sto stores (rentals, per ersonnel and and oth ther) as as wel ell as as co cost sts of f fr franchise sto stores in Pol

• land. Sto

tores in th the e Middle Ea East do

• no

not t ha have any ma material ef effect ct on

• n SG&

G&A co cost sts.

• Co

Costs of

• f sto

stores  YoY

• Y gr

growth th in 1Q1 Q17 due ue to to hi higher YoY

• Y flo

floorspace, dep eprecia iation of

• f zlot

zloty ve versus eu euro and nd HR HR co cost sts. Fal Fall in n co costs ts of

• f fra

franchise sto stores in n Pol

• land, due

ue to to sw switc itch to to co company ow

• wned sto

stores.

• HQ

HQ co costs sts  YoY

• Y gr

growth in 1Q1 Q17 due ue to to dev evelopment t of

• f product

ct dep epartments and fur further e-commerce exp expansion.

SG SG&A COS COSTS

(PLN LN m) m) +20% YoY +23% YoY 595 719

SG SG&A COS COSTS

(PLN LN m) m)

476 573 119 146 1Q16 1Q17 Costs of stores HQ 409 434 444 493 476 521 537 546 573 103 90 103 115 119 131 125 153 146 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 Costs of stores HQ

SLIDE 35

35

G L O B A L A S P I R A T I O N S

Other operating and net financial lines

O T H E R O P E R A T I N G A C T I V I T Y N E T F I N A N I A L A C T I V I T Y

PLN m 1Q16 1Q17

OTHER OPERATING REVENUES 6.4 7.9 Inve ventory ex excess ss 4.5 3.6 Gain on sale of asse sets, , write-ups 0.8 4.1 OTHER OPERATING COSTS 16.8 18.2 Write-offs 4.1 0.0 Inve ventory losse sses 9.4 11.9 Do Donations and other 2.3 3.7

OTHER OPERATING ACTIVITY

• 10.4
• 10.4

mln PLN 1Q16 1Q17

FINANCIAL REVENUES 2.2 1.7 FX FX ga gains 1.9 0.4 Interest st 0.2 1.3 FINANCIAL COSTS 7.2 4.2 FX FX loss sses 0.0 0.0 Interest st 5.8 3.4 Fee Fees s and charges 1.5 0.8

NET FINANCING ACTIVITY

• 5.0
• 2.5

Sta table lev level of

• f ne

net ot

• ther op
• peratin

ing act ctiv ivity: hi higher YoY

• Y

writ ite-ups of

• f ass

ssets in 1Q 1Q17 co compensated by y hi higher inventory los losses (co consequence of

• f pick-up in act

ctiv ivity lev levels). PLN LN 0. 0.4m FX FX ga gains (1Q16: PLN LN 1. 1.9m ga gain ins), including PLN LN 5. 5.0m los losses on rubble and and hryvna (1Q 1Q16: PLN LN 1. 1.4m ga gain ins), PLN LN 16.6 16.6m ga gain ins on

• n US

US$ (1Q 1Q16: PLN LN 1. 1.1m ga gains) and nd PLN LN 11.2 11.2m loss losses on

• n ot
• ther cu

currencies (EUR, RO RON, HU HUF, CZ CZK). ).

SLIDE 36

36

G L O B A L A S P I R A T I O N S

Historical quarterly numbers

PLN m 2Q15 2Q16 3Q15 3Q16 4Q15 4Q16 1Q16 1Q17 YoY Revenues 1,291.3 1,502.4 1,261.5 1,488.4 1,575.0 1,853.4 1,174.8 1,362.3 16.0% Gross profi fit on

• n sale

les 673. 673.4 749. 749.7 663. 663.2 700. 700.6 862. 862.8 941. 941.7 541. 541.8 620. 620.6 14.6% Gross profi fit margin 52. 52.1% 49. 49.9% 52. 52.6% 47. 47.1% 54. 54.8% 50. 50.8% 46. 46.1% 45. 45.6%

• 0.5 p.p.

SG&A cos

• sts

523. 523.5 651. 651.7 546. 546.8 662. 662.2 608. 608.9 699. 699.6 595. 595.3 719. 719.2 20.8% Ot Other er op

• per

erating line

• 13.

13.1

• 11.

11.6

• 9.

9.6

• 33.

33.6

• 18.

18.5

• 43.

43.0

• 10.

10.4

• 10.

10.4 EBIT 136.8 86.5 106.8 4.8 235.4 199.1

• 63.9
• 109.0

n/m EB EBIT margin 10. 10.6% 5. 5.8% 8. 8.5% 0. 0.3% 14. 14.9% 10. 10.7%

• 5.

5.4%

• 8.

8.0%

• 2.6 p.p.

Net et fina nancial l acti tivity ty 21. 21.5 2. 2.4

• 14.

14.4

• 8.

8.0

• 42.

42.0

• 21.

21.7

• 5.

5.0

• 2.

2.5 Pre-tax profit 158.3 88.9 92.5

• 3.2

193.4 177.4

• 68.9
• 111.5

n/m Ta Tax 21. 21.6

• 0.

0.9 12. 12.7 3. 3.2 21. 21.0 20. 20.4

• 3.

3.4 5. 5.5 Net income 136.6 89.8 79.7

• 6.5

172.3 157.0

• 65.6
• 117.0

n/m Net et inco ncome margin 10. 10.6% 6. 6.0% 6. 6.3%

• 0.

0.4% 10. 10.9% 8. 8.5%

• 5.

5.6%

• 8.

8.6%

• 3.0 p.p.

SLIDE 37

37

G L O B A L A S P I R A T I O N S

Cash flows

• Operatin

ing cas cash flo flow  mo more fa favourable YoY

• Y due

ue to to ext extending th the e payment ter terms for for sup suppliers.

• Inv

nvestin ing cas cash flo flow  hi higher YoY

• Y cap

capex due ue to to payments fo for sto stores op

• pened in

n 4Q 4Q16.

• Fi

Financing cas cash flo flows  usage of f sho short-term deb ebt t due e to to neg egative operating cas cash flo flows.

• PLN

LN 1. 1.6bn in n op

• pen cr

cred edit t lin lines use used fo for lett letters of

• f cr

credits ts, gu guarantees and nd ov

• verdrafts

ts.

1Q 1Q17 CA CASH GEN ENERATION

(PLN LN m) m)

1Q 1Q17 CA CASH FL FLOW OWS

(PLN LN m) m) 366

• 111

280 +74

• 21
• 26
• 112

+118

• 7
• 202
• 93
• 17
• 106

142 115

• 78
• 85

1Q16 1Q17 Operating CF Investing CF Financing CF Total CF

SLIDE 38

38

G L O B A L A S P I R A T I O N S

Balance sheet increasingly strong

• Hi

Higher YoY fix fixed ass ssets ts due ue to to investments ts in n sto stores. Fal Fall QoQ

• Q due

ue to to ne network op

• ptim

imisatio ion in n Pol

• land.
• Hig

igher YoY intangibles, , desp espite Ta Tallinder brand writ ite-

• ff
• ffs, due

ue to to investments ts in co concept t stor stores of

• f fiv

five brands and IT T ou

• utl

tlays.

• YoY
• Y fa

fall in n inventory due ue introductio ion of

• f ne

new inventory ma management pol

• lic

icy.

• YoY gr

growth in rec eceivables due e to to sel sell-off of f obsolete inventory in Dec ecember 201 2016. .

• Pick-up in tr

trade li liabilitie ies YoY

• Y and

nd fa fall in sho short-term deb ebt t due ue to to ne new sup supply ch chain fin financin ing pol

• lic

icy.

• YoY
• Y fa

fall in n lon long-term deb ebt, , due ue to to mo more fa favourable YoY

• Y
• peratin

ing cas cash flo flows in 4Q 4Q16 an and 1Q 1Q17. .

PLN m 31.03.2016 31.12.2016 31.03.2017 Non-current assets 1,782.7 1,838.7 1,813.8 fixed asset ets 1, 1,241 241.3 1, 1,291 291.3 1, 1,272 272.0 Int ntangi gible bles (inc. goo

• odw

dwill ll) 325. 325.2 330. 330.6 334. 334.2 Current assets 1,761.6 1,839.3 1,856.1 inve nvento tory 1, 1,373 373.6 1, 1,164 164.1 1, 1,251 251.4 trade rec eceivable les 109. 109.6 165. 165.4 154. 154.8 cash h and nd equ quivale lents ts 145. 145.3 365. 365.8 280. 280.4 Total assets 3,544.3 3,677.9 3,669.9 Equity 1,851.1 2,134.7 2,016.4 Lo Long-term liabi bilities 326.8 267.3 258.3 int nterest bea earing g deb ebt 268. 268.2 195. 195.0 181. 181.8 Short-term liabilities 1,366.4 1,275.9 1,395.2 trade liabi bili liti ties 604. 604.0 881. 881.1 881. 881.9 int nterest bea earing g deb ebt 711. 711.8 315. 315.1 446. 446.2 Total liabilities 3,544.3 3,677.9 3,669.9

SLIDE 39

39

G L O B A L A S P I R A T I O N S

493 627 560 754 538 666 661 828 614 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 39

CUSTOMER Women, , men en and nd chi hild ldren. YEAR OF LAUNCH 1998 1998 BRAND CONCEPT A A fast fashion brand with th a broad d cus ustomer base; ; wide de range of

• f colle
• llections.

STORE CONCEPT Each ch store ha has thr hree sec ecti tions - wom

• men,

, men en and nd chi hild ldren, , diff fferenti tiated by y colou lours and nd fixtu tures and nd fitt

• ttings. Me

Men and nd wom

• men

zon

• nes

es are e sub ub-divided in into displa lay lines. MARKETING Adv dvertised by y int nter ernati tional l stars (Georgia May May Jagg gger, , Broo

• oklyn

n Bec eckham).

1Q16 1Q17 YoY Number of stores 448 455 + 7 Fl Floorsp space (ths ths m2 m2) 467.1 510.7 9% 9% Ave verage store spa pace (m2) (m2) 1,0 ,043 1,1 ,122 8% 8% Ave verage mo monthly sales (P (PLN/m2) 395 411 4% 4%

PLN m

REV REVENUES

SLIDE 40

40

G L O B A L A S P I R A T I O N S

142 196 217 234 167 232 246 269 189 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 40

CUSTOMER Tee Teenagers – boys ys and nd girls ls. YEAR OF LAUNCH 2004 2004 BRAND CONCEPT A casual l str tree eetwear brand. STORE CONCEPT The he sho hopp pping space is des esigned d in n the e form

• rm of
• f squat,

, garage and nd indu ndustrial l ha halls ls. Sto tores enco compass spe pecial l rel elax zon

• nes

es with th Pl PlayStati tion and nd table blets with th WiFi. Sho hop p window displa lays are e equi quipped with th mode

• dern mult

ultimedia. MARKETING Pa Partner of

• f eve

vents ts for

• r arti

tists and nd str treet et art.

1Q16 1Q17 YoY Number of stores 375 376 + 1 Fl Floorsp space (ths ths m2 m2) 115.4 120.1 4% 4% Ave verage store spa pace (m2) (m2) 308 319 4% 4% Ave verage mo monthly sales (P (PLN/m2) 487 525 8% 8%

PLN m

REV REVENUES

SLIDE 41

41

G L O B A L A S P I R A T I O N S

127 160 170 216 144 189 189 245 159 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 41

CUSTOMER Tee Teenagers (bo boys and nd girls ls) who ho like brave fashion cho hoices. YEAR OF LAUNCH 2001 2001 (in LPP’s Group since ce 4Q08 4Q08). ). BRAND CONCEPT Urban fashion

• n brand

d with th fol

• lk and

nd vintage ele lements ts. STORE CONCEPT The he int nterior of

• f the

e store is ins nspired by y mus usic ins nstruments and nd pos

• ssesses many

mus usic and nd art t rel elated d det etails

• ls. A fres

esh loo

• ok

is obta

• btained by

y us usage ge of

• f woo
• ode

den ele lements ts and nd glass & & met etal l lamps. MARKETING Pa Participa pates in n mult ultiple le arti tistic eve vents and nd sponsors alte ternative mus usic, , eg eg. . iFes estival.

1Q16 1Q17 YoY Number of stores 322 321

• 1

Fl Floorsp space (ths ths m2 m2) 100.5 102.9 2% 2% Ave verage store spa pace (m2) (m2) 312 321 3% 3% Ave verage mo monthly sales (P (PLN/m2) 481 512 6% 6%

PLN m

REV REVENUES

SLIDE 42

42

G L O B A L A S P I R A T I O N S

115 146 151 175 150 183 192 211 184 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 42

CUSTOMER Youn

• ung women.

YEAR OF LAUNCH 2008 2008 (in LPP’s Group since 4Q08 4Q08) BRAND CONCEPT A brand tha hat com

• mbines comfort and

nd ele legance for

• r bus

usiness and nd info nformal l mee eeti tings gs. STORE CONCEPT Con

• nce

cept rela lates to

• ele

legance and nd bea eauty. The The ce centr tre of

• f the

he store is bright t and nd is sur urrounded by y a darker envi vironment. MARKETING Anj nja Rubi bik create ted a limited colle

• llection

n for

• r

AW2014/15

• 15. Zuza

Zuzanna Bijoch wa was the e face ce

• f
• f AW201

015/16 6 colle

• llecti
• tion. Top

Top-mode del l Anna nna Jagodzińska adv dvertised SS16 6 colle

• llection.

1Q16 1Q17 YoY Number of stores 281 285 + 4 Fl Floorsp space (ths ths m2 m2) 94.9 97.8 3% 3% Ave verage store spa pace (m2) (m2) 337 342 1% 1% Ave verage mo monthly sales (P (PLN/m2) 528 622 18%

PLN m

REV REVENUES

SLIDE 43

43

G L O B A L A S P I R A T I O N S

58 83 83 105 88 117 120 135 112 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 43

CUSTOMER Tee Teenagers – girls ls only.

• nly.

YEAR OF LAUNCH 2013 2013 BRAND CONCEPT Cloth thes for

• r eve

very day y ins nspi pirations and nd

• r
• riginal

l party outfi

• utfits.

. The The brand d stands out

• ut

for

• r or
• riginal

l T-shirts ts with th extr traordinary prints ts. STORE CONCEPT Fres esh and nd ed edgy int nter eriors yet et mono

• nochromati

tic to

• diff

fferenti tiate from colo

• lourful

l clothes es sold.

• ld. Sel

elli ling area ea divi vide ded int nto

• black and

nd whi hite parts. MARKETING In n AW15/16 6 singe ger Ma Margaret t des esigned ed her her star colle

• llection.

.

1Q16 1Q17 YoY Number of stores 172 198 + 26 Fl Floorsp space (ths ths m2 m2) 60.5 69.8 15% Ave verage store spa pace (m2) (m2) 352 352 0% 0% Ave verage mo monthly sales (P (PLN/m2) 491 536 9% 9%

PLN m

REV REVENUES

SLIDE 44

44

G L O B A L A S P I R A T I O N S

44

CUSTOMER Me Men and nd wom

• men +

+ 30 30 yea ears ol

• ld.

d. YEAR OF LAUNCH First stores open

• pened

ed in n Feb ebruary 2016. 2016. Thes These wer ere closed d down in n Feb ebruary 2017 2017 due e to

• uns

unsatisfactory sale les/ m2 2 and nd growing g los

• sses.

BRAND CONCEPT Fashion brand for

• r cus

ustomers who ho app ppreciate te timele less ele legance, , minimalism and nd hi high gh qua uali lity. STORE CONCEPT El Eleg egant t store int nter eriors dec ecorated d in n na natu tural mate terials like e stone, , leath ther and nd woo

• od

stained in n ink nk. MARKETING SS16 6 colle

• llecti

tion adv dvertised ed by y a wel ell-known foo

• otb

tball ll player Jarosław Bien eniuk.

1Q16 1Q17 YoY Number of stores 6

• 6

Fl Floorsp space (ths ths m2 m2) 2.9 0.0

• 100%

Ave verage store spa pace (m2) (m2) 484 n/m Ave verage mo monthly sales (P (PLN/m2) 324 395 22%

PLN m

(closed down in 1Q17)

1 3 4 5 1 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17

REV REVENUES

SLIDE 45

45

G L O B A L A S P I R A T I O N S

Glossary

Poland Ret Retail sales in Poland and other sales s of LPP PP SA. CE CEE Reg Region including: : Czech Rep Republic, , Slovakia, , Hungary. Baltic Reg Region including: : Lithuania, , Latvi via, , Estonia. CIS IS Reg Region including: : Ru Russi ssia, , Uk Ukraine and from 2017 also so Bel elarus s and Kazakhstan. SEE Reg Region including: : Bulgaria, , Rom Romania, , Croatia, , while from 2017 also so Serbia. WE WE Reg Region including Ger Germany and from 2017 also so the e UK UK. ME ME Reg Region including: : Egyp ypt, , Qa Qatar, , Kuwait, , Saudi Arabia, UAE UAE. Europe Reg Region including: CEE, , Baltic, , SEE and WE. EBIT BITDA EBIT BIT + depr epreciation from cash sh flow statement. Ave verage mo monthly reve evenues/m2 /m2 Re Reve venues of seg egment or brand / average working total floorsp space / 3. Ave verage mo monthly cost sts of own stores/m2 /m2 Qu Quarterly cost sts s of own stores / ave verage working floorsp space of own stores s (ie ie. . excluding all franchise stores which repr epresent c. . 6% of the e working floorsp space) / 3. Ave verage mo monthly SG&A PLN/m /m2 Qu Quarterly SG SG&A cost sts/ / ave verage working total floorsp space excluding stores located in ME / 3. Inve ventory/ / m2 m2 End of per period gr group inve ventory/ / total floorspace without franchise se stores in ME.

SLIDE 46

CONTACT INFORMATION

GDAŃSK HEADQUARTERS

LPP SA Łąkowa 39/44 80-769 Gdańsk, Poland

• Tel. +48 58 76 96 900

Fax.+48 58 76 96 909 Email: lpp@lppsa.com

CRACOW BRANCH

LPP SA Bagrowa 7 30-733 Cracow, Poland

• Tel. +48 12 39 25 000

LOGISTICS CENTRE

LPP SA Tczewska 2 83-800 Pruszcz Gdański, Poland

MEDIA CONTACT

Email: media@lppsa.com

IR CONTACT

Email: LPP.investor.relations@lppsa.com