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3 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, 21 ST NOVEMBER 2017 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


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SLIDE 1

3 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, 21 ST NOVEMBER 2017

slide-2
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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SLIDE 3

3

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

1 2

3 3Q17 financial results Key corporate events 2017 and 2018 outlook

slide-4
SLIDE 4

4

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

Almost PLN 5bn revenues in 9M17

20

COUNTRIES

1,683

STORES

+6%

m2

+8.8%

LFLs

+114%

E-COMMERCE

+17%

GROUP REVENUES

slide-5
SLIDE 5

5

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

20 countries, 3 continents

@ Int nter ernet stores xx xx Numbe ber of

  • f stores

19 @ 982 @ 79 @ 56 @ 74 3 28 @ 12 17 19 @

26 @

19 @ 35 @ 304

1 1 3 1

30.09.2017

  • No. of stores

YoY LPP GROUP 1,683 +15 Reserved 454 +5 Cropp 373

  • 2

House 324

  • 2

Mohito 285

  • 3

Sinsay 213 +28 Tallinder

  • 8

Outlets 34

  • 3

1 @ 3

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SLIDE 6

6

G L O B A L A S P I R A T I O N S 6.6 12.8 13.9 31.6 74.8 3Q13 3Q14 3Q15 3Q16 3Q17

LFL and e-commerce growths

  • LF

LFLs Ls wer ere posit itive in ea each mo month and and fo for ea each brand in 3Q17. .

  • 3Q17 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 in Hu Hungary, , Ro Romania, Uk Ukraine and nd Cz Czech Rep Republic).

  • On

On-line sa sales amounted to to 5, 5,4% % rev evenues in Pola

  • land and

nd 4, 4,1% % of

  • f group revenues in

n 3Q17. .

  • Fu

Further e-commerce gro growth due ue to to investments in n int nternet t and nd mo mobile stor stores of

  • f all

ll brands and dev evelopment t of

  • f e-sto

tores

  • u
  • uts

tside Pol

  • land.

+127% YoY

LF LFL L DYN DYNAMICS

(lo local cu currencies)

ON ON-LI LINE SA SALE LES

(PLN LN m) m)

+137% YoY +9% YoY +93% YoY

  • 0.8%

1.5%

  • 1.5%

2.8% 4.2% 6.6% 9.2% 5.1% 4.6% 6.2% 15.2%

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SLIDE 7

7

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

Floorspace growths in all brands

  • Dynamic Res

Reserved 3Q17 revenue gr growth res esulted fr from: flo floorspace dev evelopment as as wel ell as as mo more fa favourable YoY rec eceptio ion of

  • f brand’s co

coll llectio ions by y cu cust stomers.

  • Double-dig

igit t LFL LFLs and nd revenue gr growth in n Cr Cropp in 3Q17 – str strong back-to to-school ef effect. .

  • 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.

+ 22% YoY + 8% YoY +4% YoY + 25% YoY + 38% YoY + 137% YoY

ths m2 3Q16 3Q17 YoY

GR GRUPA LPP 888.0 939.9 5.9% Res Reserved 487.2 526.8 8.1% Cropp 116.7 121.4 4.0% House 103.8 105.6 1.7% Mohito 97.6 98.5 0.9% Sinsay 65.2 76.0 16.7% Tallinder 3.7 0.0

  • 100.0%

Ou Outlets 13.8 11.6

  • 15.6%

REV REVENUES BY BY BR BRANDS

(PLN LN m)

3Q 3Q17 FL FLOORSPACE

(by brands)

41 75 165 200 205 302 825 Other E-commerce Sinsay Mohito House Cropp Reserved

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SLIDE 8

8

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

Growths in key regions

  • Re

Revenue gr growth th in Poland hig igher th than flo floorspace gr growth due to to posit itiv ive LF LFLs Ls.

  • Dynamic revenue and

nd flo floorspace gr growth in n Eur Europe in 3Q17 among ot

  • thers due

ue to to dev evelopment in th the e UK UK and Ser erbia. .

  • Flo

Floorspace gro growth in n CI CIS co contin inued in 3Q 3Q17 to together wit ith fa favourable im impact t of

  • f YoY
  • Y rub

ubble appreciatio ion to to zlot zloty.

  • Among co

countries, th the hi highest t no nominal YoY

  • Y revenue gr

growth was rec ecorded in n Ru Russia and nd Pola

  • land.

REV REVENUES BY BY REG REGIONS

(PLN LN m) m)

3Q 3Q17 FL FLOORSPACE

(by reg egions)

ths m2 3Q16 3Q17 YoY LPP GROUP

888.0 939.9 5.9%

Po Pola land

471.2 490.5 4.1%

Eur Europe

205.2 224.1 9.2%

CIS

204.0 218.7 7.2%

ME ME

7.6 6.6

  • 13.3%

+ 20% YoY + 16% YoY + 36% YoY

  • 55% YoY

4 401 407 1,000 ME Europe CIS Poland

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SLIDE 9

9

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

Acceleration of sales/ m2 growth

  • Gr

Group revenues gr grew 21.8 .8% % YoY in 3Q17 due to to hig igher flo floorspace, , posit itiv ive LF LFLs Ls and and hig igh e-commerce gr growth.

  • In

n 3Q17 bot

  • th gr

group revenues/ m2 m2 and nd ret etail sa sales/ m2 m2 were dou

  • uble-dig

igit hi higher YoY

  • Y.
  • The

The hi highest t dou

  • uble-dig

igit t ret etail sa sales/ m2 m2 were rec ecorded in 3Q17 in n Ce Central and Ea Eastern Eur Europe. .

GROUP REV REVENUES

(PLN LN m) m)

REV REVENUES/ / M2

PLN (monthly) 3Q16 3Q17 YoY LPP GROUP (ret etail) 547 547 638 638 16. 16.6% Po Pola land 560 560 661 661 18. 18.0% Eur Europe 497 497 605 605 21. 21.7% CIS 570 570 625 625 9. 9.8% LPP GROUP 567 567 648 648 14. 14.3%

6.1% 9.0% 2.2% 12.1% 17.2% 16.4% 18.0% 17.8% 16.0% 13.5% 21.8% 0% 5% 10% 15% 20% 25% 500 1,000 1,500 2,000

1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Retail sales (brands) E-commerce Other (incl. outlets) Revenue growth

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SLIDE 10

10

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

4.0 3.9 3.9 4.1 4.1 3.8 3.6 3.6 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17

54.2% 52.1% 52.6% 54.8% 46.1% 49.9% 47.1% 50.8% 45.6% 56.5% 49.0%

Gross profit margin improvement continues

  • Siz

Sizeable 3Q17 YoY gr gross profit t ma margin pick-up up, due to to: : (1) ) improved co collectio ions, (2) ) fa favourable FX FX tre trends, an and (3) ) new ew inventory ma management pol

  • lic

icy.

  • The

The ne new pol

  • lic

icy res esults in n si sizeable gro gross profit ma margin differences betw etween th the e sel sell-off and ful full ma margin mo months: 36 36% % in Jul uly 201 2017 (-2p.p. YoY

  • Y), 47%

47% (+2 +2p.p. YoY

  • Y) in Aug

ugust 201 2017, co compared to to 62% 62% (+3 p.p. YoY

  • Y) in

n Sep eptember or

  • r 61%

61% (+ (+1p.p. YoY

  • Y) in

n Oct ctober 201 2017.

  • Due to

to new inventory management t polic icy we e are are bet etter prepared fo for weather ch changes in th the e sea season.

QU QUARTE TERLY Y GROSS PR PROFIT IT MAR ARGIN IN AV AVERAGE QU QUARTERLY US$ S$/P /PLN

NEW INVENTORY MA MANAGEMENT POL POLIC ICY FX LEV EVELS IMP MPORTANT T FOR SETT ETTIN ING AW17 17/18 PR PRIC ICES

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SLIDE 11

11

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

236 230 232 244 237 254 254 258 266 271 280

Higher costs/ m2

  • Sta

Stable YoY rental ch charges  ap appreciatio ion of f zlot zloty ve versus eu euro and and fa favourable new ag agreements.

  • YoY
  • Y pick-up in

n per ersonnel co costs ts  gro growth in n sa salaries acr cross all ll co countr tries. .

  • Hi

Higher YoY ot

  • ther co

costs ts of

  • f stor

stores  hi higher usa usage of

  • f ma

materials due ue to to op

  • pening in

n Lo London.

  • Gr

Growth in n SG& G&A/ m2 m2 YoY

  • Y  hi

higher co costs ts of

  • f he

headquarters (development t of

  • f prod
  • duct

t divisions, fur further e-commerce exp expansion and nd resultant t pick-up in n log logistics co costs ts, , on

  • ne-off ma

marketin ing co costs ts rel elated to to Lo London sto store op

  • pening) and

nd hi higher co cost sts of

  • f sto

stores.

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

+4% YoY +10% YoY

93 93 90 89 93 98 99 89 98 97 100 50 48 47 52 52 56 57 59 63 62 61 46 47 48 55 46 48 49 53 53 53 53 189 187 186 195 191 202 205 201 214 211 214

Rental costs HR costs Other costs

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SLIDE 12

12

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

Over PLN 100m of EBIT in 3Q17

PLN m 3Q16 3Q17 YoY Revenues 1,488.4 1,812.8 21.8% Gross profi fit margin 47. 47.1% 49. 49.0% 1. 1.9p. 9p.p. SG&A cos

  • sts

662. 662.2 775. 775.0 17. 17.0% EBIT 4.8 103.1 2,046.7% EB EBIT margin 0. 0.3% 5. 5.7% 5. 5.4p. 4p.p. Net profit

  • 6.5

85.1 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.

  • Siz

izeable gross profit margin in growth, due to to improved collections, more favourable FX FX and introductio ion of

  • f

ne new inventory management pol

  • lic

icy.

  • Favourable operating leverage impact – SG&A growth

bel elow to top-line gr growth.

  • Mor
  • re fa

favourable ne net fin financials:

  • low
  • wer int

nterest due ue to

  • low
  • wer inde

ndebt btedness,

  • hi

high gher FX gains.

  • Fr

From ne net loss loss to to ne net profit.

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SLIDE 13

13

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

Triple-digit earnings growth in 9M 9M17 17

PLN m 9M16 9M17 YoY Revenues 4,165.6 4,880.5 17.2% Gross profi fit margin 47. 47.8% 50. 50.7% 2. 2.9p. 9p.p. SG&A cos

  • sts

1, 1,909 909.2 2, 2,238 238.1 17. 17.2% EBIT 27.4 201.7 637.3% EB EBIT margin 0. 0.7% 4. 4.1% 3. 3.5p. 5p.p. Net profit 17.7 141.4 696.7%

  • Dynamic

ic group revenue growth due to to favourable developments in in both business lines: tradit itio ional stores (p (posit itive changes in in Reserved brand, acceleration in in Cr Cropp brand) and and in in e-commerce.

  • Gross profit

it margin pic ick-up up, due to to new in inventory ma management pol

  • lic

icy and nd improved co coll llectio ions.

  • SG&A growth in

in line wit ith sales growth despit ite low base of

  • f 1Q16

16.

  • Other operating line more favourable YoY due to

to PLN 24 24.6m of

  • f writ

ite-offs and provis isio ions for closing dow

  • wn th

the Ta Tallinder brand in in 3Q16 16.

  • Mor
  • re fa

favourable ne net fin financials:

  • low
  • wer int

nterest on

  • n deb

ebt t and nd fee ees,

  • hi

high gher FX gains.

  • Hi

High pre-tax and nd ne net inc ncome dyn ynamics.

slide-14
SLIDE 14

14

G L O B A L A S P I R A T I O N S 1,438 1,637 113 181 808 1,416 3Q16 3Q16 3Q17 3Q17 Inventory Receivables Liabilities

Freeing up working capital even further

  • 14%

14% YoY gr growth in inventory and and 8% 8% YoY gr growth in invento tory/ m2 m2, desp espit ite str strong sa sales of f new co coll llect ction in Sep eptember due ue to to hi higher YoY

  • Y le

level of

  • f Aut

utumn/Winter co coll llectio ions at at th the e en end of

  • f 3Q

3Q17 (th the whole co collectio ion has has bee een sou sourced ea earlier).

  • Hi

Higher YoY rec eceivables due ue to to fur further inventory sel sell-offs, in lin line wit ith th the ne new pol

  • lic

icy.

  • PLN

LN 585 585m addit itional lia liabil ilities due ue to to ext extension of

  • f payment

t ter terms for for sup suppliers at at th the e en end of

  • f 3Q

3Q17. .

  • 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

(P (PLN m) m)

PLN 630m PLN 221m

1,131 1,167 1,336 1,320 1,374 1,444 1,438 1,164 1,251 1,480 1,637 1,516 1,507 1,684

1,575 1,621 1,669 1,634 1,275 1,381 1,604 1,759 400 800 1,200 1,600 400 800 1,200 1,600 2,000 Inventory (PLN m) Inventory/ m2 (PLN)

slide-15
SLIDE 15

15

G L O B A L A S P I R A T I O N S 715 583 787 621 835 700 647 144 348

  • 11

11

  • 0.2

0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4

  • 100

100 300 500 700 900 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Net debt (PLN m) Net debt/ EBITDA (x)

Sizeable net debt reduction

  • 3Q

3Q17 cap capex dou

  • ubled YoY
  • Y due

ue to to op

  • pening of
  • f sto

stores in prestig igious loc locatio ions (especia ially Lo Lond ndon) and payments fo for sto stores

  • p
  • pened and

nd mo modernised in n 2Q1 2Q17.

  • Fal

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

  • Y op
  • perating cas

cash flo flows and nd sup supply ch chain fin financing.

  • A low

low ne net t deb ebt t le level in 3Q

  • 3Q17. Our aim is

s to to ke keep ne net deb ebt/EBITDA ratio on

  • n a sa

safe lev level betw etween 0-1x 1x. .

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

(PLN LN m) m)

CAP CAPEX (PLN PLN m)

3Q16: PLN 62.1m 3Q17: PLN 120.3m

0.9x 0.8x 1.1x 0.9x 1.3x 1.0x 1.2x 0.3x 0.8x 0.0x 0.0x

27.4 77.5 51.1 73.7 99.0 76.0 101.1 8.6 11.9 11.0 10.7 13.2 13.2 19.2 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Stores Other

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SLIDE 16

16

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

9M 9M17 17 executive summary

Stores in 20 countries – entry into Belarus, Serbia and United Kingdom.

1

E-stores in 10 countries – triple-digit e-commerce growth continues.

2

High LFLs (success of Reserved collection).

3

Indebtedness at a low level due to working capital improvements.

5

Gross profit margin continues to rise YoY.

4

slide-17
SLIDE 17

17

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

1 2

3 3Q17 financial results Key corporate events 2017 and 2018 outlook

slide-18
SLIDE 18

18

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

Key corporate events

FIRST STORES IN SERBIA

Res eserved and nd Sinsay stores in n Belg lgrade, Ser erbi bia.

3, 3,50 500 m2

2

RESERVED ON-LINE IN THE UK

Engla England, d, Wale les and nd Sco cotl tland with thin the he rea each of

  • f on
  • n-li

line store.

NEW STORES IN WARSAW

Sto tores of

  • f all 5

5 bra brands

in n new new Gale leria Po Polnocna sho hopp pping mall ll in n Warsaw.

4, 4,30 300 m2

2

FLAGSHIP IN LONDON

Res eserved store in n the e cen entr tre

  • f
  • f Lon
  • ndo

don, , at at 252/ 252/25 258 Oxfo Oxford Str treet.

3, 3,00 000 m2

2

August 2017 September 2017 September 2017 September 2017

slide-19
SLIDE 19

19

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

First stores in Serbia

  • In August

t 201 2017 we e la launched 2

2 Res Reserved sto

stores and and 1

1 Sin Sinsay sto

store in Serbia ia. .

  • Flo

Floorspace: 3,50

500 m2

m2.

  • Lo

Locatio ion: Be Belgrade (capit ital ci city).

  • Target for 2018: all LPP’s brands present in Serbia, almost 20

20

stor stores ov

  • verall.

.

Serbia is the 4th country in the South Eastern-Europe in which LPP’s stores are located.

ROMANIA 35 @ BULGARIA 12 CROATIA SERBIA 3 17

slide-20
SLIDE 20

20

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

Success of Reserved in London

  • Fi

First t Res Reserved fl flagship in Lo London, UK UK, opened in Sep September 201 2017.

  • A pres

estigious ve venue: 252 252/258 Ox

Oxfo ford Str Street in

n Lo London, ne next t to to Za Zara and nd H& H&M stor stores.

  • Flo

Floorspace 3,

3,00 000 m2

m2.

  • Res

Reserved e-store op

  • pened to

together with th the e fla flagship.

  • Kate

ate Mos

  • ss th

the e fa face of

  • f Res

Reserved in th the e UK UK.

  • A succ

successful co concept t – tr traffic of

  • f 4-5

5 th ths peo eople dail ily, up up to to 6. 6.5 th ths on

  • n Saturdays.
  • Our

ur targ target t is s to to ha have PLN LN 100 100m of

  • f revenues fr

from th the sto store in 5 5 ye years.

slide-21
SLIDE 21

21

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

2 logistics centres for e-commerce

In future we plan minimum

2 new centres:

in the UK and in South Eastern Europe.

Stryków (Poland)

Arvato ser services e-commerce fo for 4 4 brands: Res Reserved, Ho House, Moh

  • hit

ito and nd Sin insay. 30 30 th ths m2 m2 with th the e poss

  • ssibil

ility to to dou

  • uble th

the flo floorspace to to 60 60 th ths m2. m2. Res Responsible for for ord

  • rders fro

from Pol

  • land and for

foreign co countries (Germany, Cze Czech Rep Republic, Sl Slovakia, Ro Romania, Hu Hungary, Bal Baltic co countries and nd th the UK UK). ). Servicing of

  • f e-commerce in

n th the who hole of

  • f Ru

Russ ssia. Flo Floorspace: 7 7 th ths m2 m2

Moscow (Russia)

We rent 2 new centres, to support e-commerce development

Poss

  • ssibil

ility to to exp expand into ot

  • ther CI

CIS regions.

slide-22
SLIDE 22

22

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

1 2

3 3Q17 financial results Key corporate events 2017 and 2018 outlook

slide-23
SLIDE 23

23

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

2017 target: million of m2 of floorspace

  • 9%

% YoY flo floorspace gr growth th in 201 2017.

  • Res

Reserved sto stores in 20 co countries at t th the en end of

  • f 201

2017.

  • In

n 4Q 4Q17 we e pla lan op

  • pening 61.5

61.5 th ths m2

  • m2. Sources of
  • f

gro growth:

  • c. 24

24 ths hs m2 2 in n Po Poland,

  • fur

urther CEE CEE develo lopment, ,

  • CIS:

: +16 +16 ths hs m2 2 in n Rus ussia, , +12 +12 ths hs m2 2 in n Ukraine and nd new new stores in n Bel elarus, ,

  • Balt

ltic coun

  • untries:

: +4. +4.4 4 ths hs m2 2 in n Es Esto tonia, ,

  • fur

urher open

  • penings in

n the he SEE EE reg egion (Bulg lgaria and nd Croati tia).

  • Pla

lanned 201 2017 cap capex at at c.

  • c. PLN

LN 410 410m, up c.

  • c. 50%

% YoY. Pla lanned stor store cap capex at t PLN LN 370m, , HQ HQs ou

  • utl

tlays at at PLN LN 10 10m and nd IT T and nd e-commerce ou

  • utl

tlays at at PLN LN 30 30m.

Floorspace (ths m2) 2016 2017 former target 2017 target YoY BY BRANDS Res eserved 509. 509.1 565. 565.3 562. 562.4 10% 10% Cr Cropp 120 120.4 127 127.4 127 127.2 6% 6% Hou

  • use

105. 105.7 111. 111.7 111. 111.1 5% 5% Mo Mohi hito 99. 99.1 103. 103.7 103. 103.7 5% 5% Sinsay 69. 69.8 86. 86.3 84. 84.3 21% 21% Ta Talli linder 4. 4.1 0. 0.0 0. 0.0

  • 100

100% Out Outle lets 12. 12.6 14. 14.5 12. 12.6 1% 1% BY REGIONS Po Pola land 496. 496.6 510. 510.1 514. 514.0 4% 4% Eur Europe 209. 209.5 236. 236.5 231. 231.4 10% 10% CIS 207. 207.0 255. 255.6 249. 249.3 20% 20% ME ME 7. 7.6 6. 6.6 6. 6.6

  • 13

13% TOTAL 920.7 1,008.8 1,001.4 9%

slide-24
SLIDE 24

24

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

2017 targets

REVENUES GROSS PROFIT MARGIN OPERATING COSTS INTEREST/ INDEBTEDNESS FX GAINS Double-dig igit t gro group revenue gro growth due ue to to flo floorspace dev evelopment t and nd e-commerce. Gr Group gro gross prof

  • fit margin sho

should be e around 53% 53% in 201 2017 (higher YoY

  • Y).

). Co Controllable SG& G&A/ m2 m2 gr growth. . Ind ndebtedness at t a low low le level. He Hedging of

  • f cas

cash flo flows for for sup suppliers fro from Jun une 201 2017.

slide-25
SLIDE 25

25

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

2018 outlook

2 0 1 8 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

Con Continuation of

  • f do

double-digit re reven venue gro growth du due to to floorspace de devel velopment an and d e-com commerce. . Group’s gross profit margin should be be betw tween 53 53-54 54% (hi higher YoY YoY). ). Net t de debt bt at at low

  • w level

vels, , am amon

  • ng oth
  • ther

du due to to fur urther work

  • rkin

ing cap capital al im improvements. LPP’s stores in new cou countries. E-co commerce in in ne new cou countries cou coupled with ith fur urther e-sto tores de devel velopment in in Rus Russia. . Ba Ban n on

  • n trad

trade on

  • n Sun

Sundays (18 18% of

  • f re

reven venues). Unf nfav avourab able le FX FX tren trends

  • n
  • n US$,

S$, EU EUR, RUB ver versus PLN PLN. .

slide-26
SLIDE 26

26

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

  • We

e aim im to to en enter at t le least t on

  • ne co

countr try ev every ye year.

  • In 201

2017 we e en entered 3 3 new ma markets ts: Be Belarus (franchise sto stores), Se Serbia ia and and th the UK UK (both with own sto stores).

  • We

e pla lan to to en enter 3 3 ne new co countries in 201 2018: Kaz Kazakhstan (own stor stores, ch change fr from fr franchise), Isra srael (fra franchise sto stores) and nd Slo lovenia (own sto stores).

EXP EXPANSION BY BY COU COUNTRIES

New country every year

eop 2013

13 states 17 states 18 states 20 states 23 states

+ Croatia + Germany + Egypt + Qatar + Kuwait + Saudi A. + UAE + Serbia + UK

  • Saudi A.

+ Belarus + Israel + Slovenia + new countries

11 states

eop 2014 eop 2015 eop 2016 eop 2017 eop 2018

+ Kazakhstan

slide-27
SLIDE 27

27

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

Growths on all markets in 2018

  • 10

10% % YoY flo floorspace gr growth in 201 2018. .

  • Res

Reserved sto stores in 23 co countries at t th the en end of

  • f 201

2018. .

  • 3

3 ne new markets in n 201 2018: :

  • Kazakhstan and

nd Slovenia (own stores),

  • Israel

l (fr franchise stores).

  • 201

2018 targ targets ts:

  • sele

lecti tive growth th in n Po Pola land, d,

  • acc

cceler eration of

  • f growth in

n Eur Europe pe (em emphasis on

  • n Sou
  • uth

th Ea Easte tern Eur Europe),

  • con
  • nti

tinu nuation of

  • f CIS dev

evelo lopmen ent, ,

  • return to
  • ME

ME growths.

  • Pla

lanned 201 2018 cap capex at t c.

  • c. PLN

LN 430 430m, up up c.

  • c. 5%

% YoY

  • Y.

Pla lanned stor store cap capex at t PLN LN 320 20m, , HQ HQs ou

  • utl

tlays at at PLN LN 90 90m and nd IT T and nd e-commerce ou

  • utl

tlays at at PLN LN 20 20m.

Floorspace (ths m2) 2017 target 2018 target YoY BY BRANDS Res eserved 562. 562.4 627. 627.5 12% 12% Cr Cropp 127 127.2 131 131.4 3% 3% Hou

  • use

111. 111.1 114. 114.9 3% 3% Mo Mohi hito 103. 103.7 108. 108.3 4% 4% Sinsay 84. 84.3 107. 107.2 27% 27% Out Outle lets 12. 12.6 11. 11.0

  • 13

13% BY REGIONS Po Pola land 514. 514.0 533. 533.6 4% 4% Eur Europe 231. 231.4 282. 282.7 22% 22% CIS 249. 249.3 275. 275.0 10% 10% ME ME 6. 6.6 9. 9.1 39% 39% TOTAL 1,001.4 1,100.4 10%

slide-28
SLIDE 28

28

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

Triple-digit on-line sales growth

26.7 2013 64.8 2014 79.3 2015 173.1 2016

350.0

2017 TARGET

ON ON-LINE SALES (PLN LN m) m)

20 2020 target on

  • n-line sal

sales 7-8% of

  • f gro

group rev revenues. We e launched e-commerce in Russia in Octo ctober 20 2017. 20 2018 target: : 100% YoY on

  • n-line sal

sales gr growth.

slide-29
SLIDE 29

29 29

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

Fast growing e-commerce growth

@ @ @ @ @ @ @ @ @ @ @ @

E-commerce 2017 - 11 countries E-commerce 9M17 - 10 countries

E-STORES IN IN 12 12 CO COUNTRIES

20 2018 TAR TARGET

E-STORES IN IN 16 16 CO COUNTRIES

E-commerce 2018 - 16 countries

@ @ @ @

slide-30
SLIDE 30

30 30

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

23 countries in 2018

2017 – presence in 20 countries 2016 – presence in 18 countries 2018 – presence in 23 countries By mid-2017 LPP’s stores were also present in Saudi Arabia.

slide-31
SLIDE 31

31

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

Q&A

slide-32
SLIDE 32

32

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

Back-up

slide-33
SLIDE 33

33

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

Network development

Floorspace (ths m2) 30.09.2015 31.12.2015 31.03.2016 30.06.2016 30.09.2016 31.12.2016 31.03.2017 30.06.2017 30.09.2017 Reserved 435.7 461.3 467.1 473.8 487.2 509.1 510.7 520.8 526.8 Pol

  • land

223.4 232.5 230.9 235.1 232.0 248.7 245.9 247.4 247.9 Europe 106.5 120.2 124.0 127.2 140.0 144.1 147.7 151.3 157.6 CIS 100.4 103.1 104.6 103.9 107.7 108.7 109.5 114.0 114.7 ME ME 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 8.2 6.6 Cropp 109.1 114.5 115.4 117.8 116.7 120.4 120.1 121.9 121.4 Pol

  • land

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 66.5 64.9 Europe 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 20.8 21.2 CIS 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 34.7 35.3 House 95.2 99.7 100.5 104.8 103.8 105.7 102.9 106.6 105.6 Pol

  • land

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 65.1 64.0 Europe 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 16.2 16.2 CIS 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 25.4 25.4 Mohito 90.3 94.5 94.9 95.9 97.6 99.1 97.8 99.3 98.5 Pol

  • land

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 52.6 52.1 Europe 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 18,1 18.1 CIS 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 28.6 28.4 Sinsay 54.8 59.7 60.5 63.1 65.2 69.8 69.8 72.5 76.0 Pol

  • land

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 49.0 50.9 Europe 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 10.4 10.9 CIS 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 13.1 14.2 Tallinder (Poland only) 0.0 0.0 2.9 3.7 3.7 4.1 0.0 0.0 0.0 Outlets 13.6 13.8 13.8 13.8 13.8 12.6 12.6 12.6 11.6 Total by regions Pol

  • land

443.9 465.0 468.3 477.4 471.2 496.6 485.3 492.1 490.5 Europe 161.7 179.0 184.4 190.8 205.2 209.5 212.8 216.9 224.1 CIS 187.7 193.9 194.7 196.9 204.0 207.0 208.2 216.5 218.7 ME ME 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 8.2 8.2 6.6 6.6 TOTAL 798.8 843.5 855.0 872.7 888.0 920.7 913.9 933.7 939.9

slide-34
SLIDE 34

34

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 509.1 562.4 53.4 10% Poland 248.7 266.7 18.1 7% Europe 144.1 159.5 15.4 11% CIS 108.7 129.6 20.9 19% ME 7.6 6.6

  • 1.0
  • 13%

Cropp 120.4 127.2 6.7 6% Poland 65.3 65.7 0,4 1% Europe 21,2 22.2 1.0 5% CIS 34.0 39.3 5.3 16% House 105.7 111.1 5.4 5% Poland 64.9 65.4 0.4 1% Europe 16.4 17.1 0.8 5% CIS 24.3 28.6 4.2 17% Mohito 99.1 103.7 4.6 5% Poland 53.4 53.0

  • 0.4
  • 1%

Europe 18.1 19.7 1.6 9% CIS 27.7 31.0 3.3 12% Sinsay 69.8 84.3 14.5 21% Poland 48.6 52.8 4.3 9% Europe 9.7 12.8 3.1 32% CIS 11.5 18.7 7.2 62% Tallinder 4.1 0.0

  • 4.1
  • 100%

Polska 4.1 0.0

  • 4.1
  • 100%

Europa 0.0 0.0 0.0 0% CIS 0.0 0.0 0.0 0% Outlets 12.6 12.6 0.1 1% Poland 11.6 10.3

  • 1.3
  • 11%

Europe 0.2 0.2 0.0 0% CIS 0.8 2.1 1.4 172% TOTAL 920.7 1,001.4 80.6 9%

  • No. of STORES

31.12.2016 2017 TARGET

  • Nom. growth

YoY Reserved 461 468 7 2% Poland 236 232

  • 4
  • 2%

Europe 116 118 2 2% CIS 103 112 9 9% ME 6 6 0% Cropp 379 381 2 1% Poland 219 211

  • 8
  • 4%

Europe 68 69 1 1% CIS 92 101 9 10% House 330 335 5 2% Poland 212 207

  • 5
  • 2%

Europe 51 52 1 2% CIS 67 76 9 13% Mohito 290 294 4 1% Poland 166 160

  • 6
  • 4%

Europe 57 53

  • 4
  • 7%

CIS 67 81 14 21% Sinsay 198 232 34 17% Poland 142 151 9 6% Europe 26 33 7 27% CIS 30 48 18 60% Tallinder 9

  • 9
  • 100%

Poland 9

  • 9
  • 100%

Europe 0% CIS 0% Outlets 36 35

  • 1
  • 3%

Poland 33 30

  • 3
  • 9%

Europe 1 1 0% CIS 2 4 2 100% TOTAL 1,703 1,745 42 2%

slide-35
SLIDE 35

35

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

Changes in 3Q17 Q17 floorspace

  • Res

Reserved dev evelopment in 3Q17 res esulted fr from: (1) ) fla flagship opening in in Lo London an and (2 (2) ) opening fir first sto stores in Se Serbia ia. .

  • Clo

Closing of

  • f Cr

Cropp and Ho House sea seasonal stor stores and nd op

  • pti

timisatio ion of

  • f Moh
  • hito ne

network beh ehind flo floorspace red eductio ion in n Pola

  • land.
  • Eur

European co countries were th the le leaders of

  • f flo

floorspace gro growth in n 3Q17 due ue to to en entry on

  • nto tw

two

  • ne

new markets: Ser erbia and nd th the e UK UK.

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) 933.7

  • 0.5

+6.0 +3.6

  • 0.8
  • 1.0

939.9

  • 1.0

939.9 933.7

  • 1.6

+7.3 +2.2

  • 1.6

+6.2 ths m2 +6.2 ths m2

slide-36
SLIDE 36

36

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

3Q17 revenue growth contributors

PLN m 3Q16 3Q17 YoY LPP GROUP 1,488.4 1,812.8 21.8% Reserved PL 329.7 400.6 21.5% Reserved EX 331.1 424.7 28.3% Cropp PL 132.9 158.4 19.2% Cropp EX 113.5 143.2 26.2% House PL 125.8 133.3 5.9% House EX 63.3 71.7 13.1% Mohito PL 99.2 107.3 8.2% Mohito EX 93.2 92.7

  • 0.5%

Sinsay PL 88.0 115.6 31.4% Sinsay EX 32.1 49.6 54.6% E-commerce 31.6 74.8 136.6% Other 47.9 40.8

  • 14.8%

PLN m

1,813 1,488 +164 +55 +16 +8

PLN m

1,813 1,488

+168 +106 +56

  • 5

+43

  • 7

+45

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

3Q16 Poland Europe CIS ME 3Q17

slide-37
SLIDE 37

37

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

9M 9M17 17 revenue growth contributors

PLN m 9M16 9M17 YoY LPP GROUP 4,165.6 4,880.5 17.2% Reserved PL 971.4 1,070.6 10.2% Reserved EX 893.5 1,131.6 26.6% Cropp PL 355.2 383.1 7.8% Cropp EX 290.9 360.9 24.1% House PL 353.3 353.9 0.2% House EX 168.8 190.5 12.9% Mohito PL 286.4 314.1 9.7% Mohito EX 238.9 281.9 18.0% Sinsay PL 243.9 303.5 24.4% Sinsay EX 81.7 122.4 49.9% E-commerce 100.2 214.4 114.0% Other 181.4 153.6

  • 15.4%

PLN m

4,881 4,166 +337 +98 +22 +71

PLN m

4,881 4,166

+267 +245 +211

  • 9

+114

  • 28

+100

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

slide-38
SLIDE 38

38

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

Revenue and COGS split

9M 9M17 REV REVENUES BY BY RE REGIONS (PLN LN m) m) 9M 9M17 PUR URCHASES BY BY REG REGIONS (PLN LN m) m) TO TOP5 REV REVENUES BY BY CO COUNTRIES IN N 9M 9M17 17 (PLN LN m) m)

Pola land rem remains our ur most important mar arket. t.

Poland 55% Europe 21% CIS 23% ME 1%

China 52% Far East 40% Turkey 5% Poland 1% Other 2%

186 187 223 928 2,692 Germany Ukraine Czech Rep. Russia Poland

slide-39
SLIDE 39

39

G L O B A L A S P I R A T I O N S 1,534 1,750 375 488 9M16 9M17 Costs of stores HQ

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 and Be Belarus do

  • no

not t ha have any ma material ef effect on

  • n SG&

G&A co costs sts.

  • Co

Costs of

  • f sto

stores  YoY

  • Y gr

growth th in 3Q1 Q17 due ue to to hi higher YoY

  • Y flo

floorspace, appreciation of

  • f rub

ubble ve versus zlo zloty and nd ne new sto store in Lo

  • London. Fal

Fall in n co cost sts 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 3Q1 Q17 due ue to to dev evelopment t of

  • f product

ct dep epartments, , fu further e-commerce exp expansion and

  • ne-off ma

marketin ing co costs ts rel elated to to Lo London opening.

SG SG&A COS COSTS

(PLN LN m) m) +14% YoY +32% YoY 1,909 2,238

SG SG&A COS COSTS

(PLN LN m) m)

409 434 444 493 476 521 537 546 573 581 596 103 90 103 115 119 131 125 153 146 163 179 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Costs of stores HQ

slide-40
SLIDE 40

40

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

3Q17 other operating and net financial lines

OTH OTHER OPE OPERATING ACT ACTIVITY NET ET FINA FINANCIAL L ACT ACTIVIT ITY

PLN m 3Q16 3Q17

OTHER OPERATING REVENUES 7.4 4.8 Inve ventory ex excess ss 4.0 4.1 Gain on sale of asse sets, s, write-ups 3.6

  • 1.0

OTHER OPERATING COSTS 41.0 15.3 Write-offs 22.0

  • 0.7

Inve ventory losse sses 13.7 11.5 Do Donations and other 3.8 4.0

OTHER OPERATING ACTIVITY

  • 33.6
  • 10.6

PLN m 3Q16 3Q17

FINANCIAL REVENUES

  • 1.9

13.5 FX gains

  • 1.9

12.3 Interest 0.0 1.3 FINANCIAL COSTS 6.1 2.2 FX losses 0.0 0.0 Interest 5.6 1.9 Fees and charges 0.4 0.4

NET FINANCIAL ACTIVITIES

  • 8.0

11.2

Lo Lower oth ther oper erating co costs sts due to to la lack of f PLN LN 24. 24.6m wr writ ite-offs and provisions for for clo closing dow

  • wn of
  • f Ta

Tallinder brand cr created in 3Q 3Q16. PLN LN 12 12.3m m of

  • f FX

FX ga gains (3Q16: PLN LN 1.9m m loss losses), ou

  • ut

t of

  • f

whic ich PLN LN 4.7m m of f ga gain ins on rubble an and hryvna (3Q16: : PLN LN 9.6m m los losses), PLN LN 4.4m loss losses on

  • n US

US$ (3Q16: PLN LN 13 13.5m m ga gain ins) ) and nd PLN LN 12 12.0m m ga gains on

  • n ot
  • ther cu

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

slide-41
SLIDE 41

41

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

9M17 other operating and net financial lines

OTH OTHER OPE OPERATING ACT ACTIVITY NET ET FINA FINANCIAL L ACT ACTIVIT ITY

PLN m 9M16 9M17

OTHER OPERATING REVENUES 21.1 32.9 Inve ventory ex excess ss 12.0 10.5 Gain on sale of asse sets, s, write-ups 7.4 17.3 OTHER OPERATING COSTS 76.6 51.4 Write-offs 29.6 11.1 Inve ventory losse sses 35.2 39.8 Do Donations and other 7.9 11.8

OTHER OPERATING ACTIVITY

  • 55.6
  • 33.9

PLN m 9M16 9M17

FINANCIAL REVENUES 9.4 22.2 FX gains 8.7 17.8 Interest 0.5 4.2 FINANCIAL COSTS 20.0 12.0 FX losses 0.0 0.0 Interest 17.4 10.0 Fees and charges 2.5 2.0

NET FINANCIAL ACTIVITIES

  • 10.7

10.1

Hi Higher ot

  • ther op
  • perating rev

evenues due ue to to ne new inventory ma management pol

  • lic
  • icy. Lo

Lower YoY

  • Y lev

level of

  • f ot
  • ther op
  • peratin

ing co cost sts due ue to to la lack of

  • f writ

ite-offs and nd provisions for for clo closing dow

  • wn th

the e Ta Tallinder brand whic ich (PLN 24.6 24.6m in 3Q 3Q16). PLN LN 17 17.8m m of

  • f FX

FX ga gains (9M 9M16 16: PLN LN 8.7m m ga gains), ou

  • ut

t of

  • f

whic ich PLN LN 9.0m m of f loss losses on rubble and and hryvna (9M 9M16 16: : PLN LN 4.9m m ga gain ins), PLN LN 22 22.7m m ga gain ins on

  • n US

US$ (9M 9M16 16: PLN LN 5.2m m ga gain ins) ) and PLN LN 4.1m m ga gain ins on

  • n ot
  • ther cu

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

slide-42
SLIDE 42

42

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

Historical quarterly numbers

PLN m 4Q15 4Q16 1Q16 1Q17 2Q16 2Q17 3Q16 3Q17 YoY Revenues 1,575.0 1,853.4 1,174.8 1,362.3 1,502.4 1,705.4 1,488.4 1,812.8 21.8% Gross profit on sales 862.8 941.7 541.8 620.6 749.7 964.4 700.6 888.7 26.8% Gross profit margin 54.8% 50.8% 46.1% 45.6% 49.9% 56.5% 47.1% 49.0% 1.9p.p. SG&A costs 608.9 699.6 595.3 719.2 651.7 743.8 662.2 775.0 17.0% Other operating line

  • 18.5
  • 43.0
  • 10.4
  • 10.4
  • 11.6
  • 13.0
  • 33.6
  • 10.6

EBIT 235.4 199.1

  • 63.9
  • 109.0

86.5 207.6 4.8 103.1 2,046.7% EBIT margin 14.9% 10.7%

  • 5.4%
  • 8.0%

5.8% 12.2% 0.3% 5.7% 5.4p.p. Net financial activity

  • 42.0
  • 21.7
  • 5.0
  • 2.5

2.4 1.4

  • 8.0

11.2 Pre-tax profit 193.4 177.4

  • 68.9
  • 111.5

88.9 209.0

  • 3.2

114.3 n/m Tax 21.0 20.4

  • 3.4

5.5

  • 0.9

35.8 3.2 29.3 Net income 172.3 157.0

  • 65.6
  • 117.0

89.8 173.3

  • 6.5

85.1 n/m Net income margin 10.9% 8.5%

  • 5.6%
  • 8.6%

6.0% 10.2%

  • 0.4%

4.7% 5.1p.p.

slide-43
SLIDE 43

43

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  ext extending th the e payment ter terms for for sup suppliers, ye yet t hi higher YoY

  • Y inventory.

.

  • Inv

nvestin ing cas cash flo flow  hi higher YoY

  • Y cap

capex, , op

  • pening of
  • f sto

stores in prestig igious loc locatio ions (es especially Lo Lond ndon) ) and nd payments fo for stor stores op

  • pened and

nd mo modernised in n 2Q 2Q17.

  • Fin

Financing cas cash flo flows  low lower usa usage of

  • f deb

ebt t due ue to to str strong op

  • peratin

ing cas cash flo flows.

  • PLN

LN 1. 1.6bn bn 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.

3Q 3Q17 CA CASH GEN ENERATION

(PLN LN m) m)

3Q 3Q17 CA CASH FL FLOW OWS

(PLN LN m) m) 435 +114 256 +72

  • 20
  • 25
  • 120
  • 163
  • 37

101 129

  • 43
  • 106
  • 11
  • 204

47

  • 180

3Q16 3Q17 Operating CF Investing CF Financing CF Total CF

slide-44
SLIDE 44

44

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

Balance sheet increasingly strong

  • YoY
  • Y gr

growth in fi fixed ass ssets due ue to to ne network dev evelopment t and nd investments in HQ HQs. .

  • Hig

igher YoY intangibles, due to to investments ts in co concept t stor stores of

  • f fiv

five brands and IT T ou

  • utl

tlays.

  • YoY
  • Y inc

ncrease in inventory due ue to to hi higher YoY

  • Y lev

level of

  • f

AW co coll llectio ion.

  • YoY
  • Y gr

growth in rec eceivables due ue to to sel sell-off of

  • f invento

tory to to th thir ird part artie ies in li line with th the e new polic licy. .

  • Pick-up in tr

trade li liabilitie ies YoY

  • Y and

nd YoY

  • Y fa

fall in n sho short- ter term deb ebt t due ue to to ne new sup supply ch chain fin financing pol

  • lic

icy.

PLN m 30.09.2016 31.12.2016 30.09.2017 Non-current assets 1,797.8 1,838.7 1,855.9 fixed asset ets 1,260.3 1,291.3 1,294.5 int ntangible les (inc. goo

  • odw

dwill ll) 325.9 330.6 344.2 Current assets 1,954.7 1,839.3 2,203.6 inve nvento tory 1,438.3 1,164.1 1,637.1 trade rec eceivable les 112.8 165.4 181.5 cash h and nd equ quivale lents ts 265.9 365.8 256.4 Total assets 3,752.4 3,677.9 4,059.4 Equity 1,913.0 2,134.7 2,184.0 Long-term liabilities 292.3 267.3 233.6 int nterest bea earing g deb ebt 223.5 195.0 155.2 Short-term liabilities 1,547.2 1,275.9 1,641.8 trade liabi bili liti ties 808.5 881.1 1,415.6 int nterest bea earing g deb ebt 689.4 315.1 112.1 Total liabilities 3,752.4 3,677.9 4,059.4

slide-45
SLIDE 45

45

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

493 627 560 754 538 666 661 828 614 763 825

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

CUSTOMER Women, , men en and nd chi hild ldren. YEAR OF LAUNCH 1998 1998 BRAND CONCEPT An n anch nchor brand with th a broad

  • ad cus

ustomer base and nd wide de range ge of

  • f coll
  • llecti

tion

  • ns.

STORE CONCEPT Lack ck of

  • f ded

edicate ted zon

  • nes

es allows for a smooth th transition

  • n bet

etween n women, , men en and nd chi hild ldren area

  • eas. Wide

de, , open

  • pen and

nd transpa parent storefront cou

  • uple

led with th comfo fortabl ble, , large ge and nd spacious fitt tting g roo

  • oms.

MARKETING Adve Advertised by y int nternational l stars (Kate Mo Moss, , Geo eorgia Ma May y Jagg gger, , Brookly lyn Bec eckham).

3Q16 3Q17 YoY Number of stores 449 454 +5 Fl Floorsp space (ths ths m2 m2) 487,2 526,8 8% Ave verage store spa pace (m2) (m2) 1 085 1 160 7% Ave verage mo monthly sales (P (PLN/m2) 457 539 18%

REV REVENUES

(PLN LN m) m)

slide-46
SLIDE 46

46

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

142 196 217 234 167 232 246 269 189 254 302

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

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.

3Q16 3Q17 YoY Number of stores 375 373

  • 2

Fl Floorsp space (ths ths m2 m2) 116,7 121,4 4% Ave verage store spa pace (m2) (m2) 311 325 5% Ave verage mo monthly sales (P (PLN/m2) 701 828 18%

REV REVENUES

(PLN LN m) m)

slide-47
SLIDE 47

47

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

127 160 170 216 144 189 189 245 159 181 205

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

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 Participates in n mult ultiple le artistic eve vents (es especially ly mus usic rel elate ted). Com

  • mmunication

is is based on

  • n ins

nsights and nd hum humour.

3Q16 3Q17 YoY Number of stores 326 324

  • 2

Fl Floorsp space (ths ths m2 m2) 103,8 105,6 2% Ave verage store spa pace (m2) (m2) 318 326 2% Ave verage mo monthly sales (P (PLN/m2) 600 648 8% 8%

REV REVENUES

(PLN LN m) m)

slide-48
SLIDE 48

48

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

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 Anja Ru Rubi bik created a limited colle

  • llection

n for

  • r

AW14/15. Zuz Zuzanna Bijoch wa was the he face ce of

  • f

AW15/16 colle llecti tion

  • n. Top

Top-model el Anna nna Jagodzińska adv dvertised SS16 6 colle

  • llecti

tion, whi hile le Magdalena Frąckowiak the AW16/17 colle llecti tion

  • n.

3Q16 3Q17 YoY Number of stores 288 285

  • 3

Fl Floorsp space (ths ths m2 m2) 97,6 98,5 1% Ave verage store spa pace (m2) (m2) 339 346 2% Ave verage mo monthly sales (P (PLN/m2) 657 674 3% 3%

REV REVENUES

(PLN LN m) m)

115 146 151 175 150 183 192 211 184 212 200

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

slide-49
SLIDE 49

49

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

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 Focu cus on

  • n soci

cial l med

  • edia. The

The brand d co-

  • per
  • perates with

th youn

  • ung fashion inf

nflu luencers and nd mode

  • dels
  • ls. Last

t yea ear Karoli lina Pi Pisarek and nd Ale leksandra Kowals lska wer ere the he brand’s face ces.

3Q16 3Q17 YoY Number of stores 185 213 +28 Fl Floorsp space (ths ths m2 m2) 65.2 76.0 17% Ave verage store spa pace (m2) (m2) 352 357 1% Ave verage mo monthly sales (P (PLN/m2) 626 748 19%

REV REVENUES

(PLN LN m) m)

58 83 83 105 88 117 120 135 112 149 165

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

slide-50
SLIDE 50

50

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, Bel elarus and from 2018 also so Kazakhstan. SEE Reg Region including: : Bulgaria, , Rom Romania, , Croatia, , Serbia, , while from 2018 also so Slovenia. WE WE Reg Region including Ger Germany and the e UK UK. ME ME Reg Region including: : Egyp ypt, , Qa Qatar, , Kuwait, , UAE UAE, , while from 2018 also so Israel. . Un Until mi mid-2017 the e regi egion also so en encompass ssed Saudi Arabia. Europe Reg Region including: CEE, , Baltic, , SEE and WE. EBI BITDA EBI BIT + depr depreciation 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. . 5.5% 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 and Belarus / 3. Inve ventory/ / m2 m2 End of per period gr group inve ventory/ / total floorspace without franchise se stores in ME and Bel elarus.

slide-51
SLIDE 51

GDANSK HEADQUATERS

LPP SA

  • ul. Łąkowa 39/44

80-769 Gdansk, Poland

  • Tel. +48 58 76 96 900

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

CRACOW BRANCH

LPP SA

  • ul. Bagrowa 7

30-733 Cracow, Poland

  • Tel. +48 12 39 25 000

LOGISTICS CENTRE

LPP SA

  • ul. Tczewska 2

83-800 Pruszcz Gdanski, Poland

MEDIA CONTACT

Email: media@lppsa.com

IR CONTACT

Email: LPP.investor.relations@lppsa.com