EUROCASH

Empowering modern entrepreneurs Mom & pops stores supported by demographics are still half the market

Small towns, small living quarters, daily shopping nearby drive small stores market share

Percentage of population living in cities/rural area Share of distribution channels in food sales in Poland LTM July 2018, % 32,8% 42,0% Rural 28 Cities 0-20K 40 Small Format Cities 20-50K 300-2500 8 Hypermarkets 2500+ Cities 50-100K 11 Discounters Cities 100K+ 13 9,8% 15,4%

Average number of store visits per month

 60% of Poles live in villages & small towns 50 40 13  Small living quarters have limited space to 30 13 6 9 5 4 3 7 9 6 5 20 7 3 7 4 4 11 5 store food 13 6 8 10 4 5 10 8 9 7 10 4 3 6 8 12 6 5 6 5 5 9 10 6 5  As a result, Poles shop almost every day 0 5 5 4 5 4 3 Poland Bulgaria Spain Norway UK Denmark Italy Switzerland Hungary Sweden

Discounters Hypermarkets Supermarkets Convenience Traditional stores

2 purchasing and distribution scale help small stores compete

Eurocash Group sales evolution (PLN bn) Ranking of FMCG distributors (sales, PLN bn)

Biedronka 48 17 32 Eurocash 25 25 19 23 (Pro-Forma) 7 22 20 11 16 20 20 5 18 1011 17 17 9 16 8 10 14 5 10 12 10 1011 10 10 8 6 9 2017 8 7 6 Intermarche 5 7 6 5 3 7 2013 4 3 Żabka 4 2 1 2 2 7 Metro (Makro C&C) 7 0 9 2009 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 5 Dino 1,7 Pro Forma 3 3 C&C Delikatesy Centrum Tobacco&Impulse Food Service 3 Alcohol Distribution EC Distribution Retail & Other 0 10 20 30 40 50 60

Source: Company data Building scale and purchasing power to help small stores resist competition

3 With proper support, small stores are able to resist competition Acceleration of sales dynamics of small stores in 2018

Food market growth by channels Food market growth by small format channels (YTD July 2018, YoY) Value change (YTD July 2018, YoY) +1,5bn -0,03bn +0,12bn +1,6bn +0,2bn +1,1bn -0,1bn +0,4bn 12,9% 11,0% 8,3% 8,8% 7,3% 5,7% 3,8% 2,5%

2,8% 1,2% -1,0% -1,9% 0,7% -5,6%

Small Supermarkets 100- Convenience 40-100 Small Grocers -40 Specialized & Others -0,7% -0,4% 300 YTD 2017 YTD 2018 Discounters Hypermarkets 2500+ Supermarkets 300-2500 Small Format YTD 2017 YTD 2018

 Small format increasing sales by 5.7% vs. food market  Small format stores and discounters gaining market growth of 4.9% in YTD July 2018. share at expense of super/ hypermarkets

Source: Nielsen

4 Small stores sales increase is despite their lower price inflation

Estimated inflation by store channel (July YTD 2018) Food inflation by categories

Large format categories Small format categories 5,0% 4,5% 14% 4,0% 1.8% difference 11,9% 3,4% 3,3% 12% 3,1% 2,7% 10% 3,0% 2,4% 7,8% 2,1% 8% 6,7% 2,0% 6% 3,6% 4% 3,4% 1,0% 2,7% 2,2% 2,7% 1,5% 2% 1,2% 1,0% 0,9% 0,0% 0% Discounters Hypermarkets Supermarkets Small Format Small Convenience Small Grocers 2500+ 300-2500 Supermarkets 40-100 -40 -2% 100-300 -4% -2,8%

Source: Own estimation based on Nielsen 2018 (I-VII) Source: GUS

 Eurocash inflation much below market: wholesale prices in Delikatesy Centrum: +0.1%, retail prices +1.2% in 1H 2018 YoY

5 Eurocash Group Combination of wholesale and retail brings us scale, essential to support Poland’s independent retail entrepreneurs

Purchase Scale Logistics

75% 25% WHOLESALE RETAIL 1% Cash Driver Growth Driver PROJECTS

Brand Technology Know-How

Eurocash mission to support Poland’s independent retail entrepreneurs 6 Wholesale & Retail businesses provide comprehensive value added support Together wholesale and retail comprise all enabling products, channels, and functions for independent retail entrepreneurs

WHOLESALE RETAIL Dedicated distribution platforms Purchase Scale Know-how transfer to wholesale clients

1st nationwide chain 25% Logistics 4,3 Cash&Carry Sales (PLN bn) High quality perishables at 25% Marketing affordable price 4,4 Active Distribution

Over 90% branded products 13% E-commerce 2,3 Alcohol Distribution B2B & B&C 32% Proximity 5,7 Education Tobacco & Impulse Distribution 5% CRM – customized promotions 0,8 Franchise Concepts HoReCa PLN 7.4 bn retail sales – 1.5k stores

7 Eurocash generates cash to keep investing for future competitiveness Cash generative business model funds M&A and innovation for long-term even in recent tough business context Operational Cash Flow* vs. EBITDA* Cash Conversion (in days)

0,0 1 200 93% 100% 137% 135% 60% 206% 74% 163% 250% 978 1 000 200% -5,0 Eurocash: 800 670 150% -5,8 542 589 -10,0 600 490 476 Ability to generate 412 440 324 402 361 100% -11,1 cash necessary to 400 266 266 -15,0 -12,4 231 216 246 -13,2 invest into future 50% 200 growth -20,0 -17,2 -17,6 0 0% -19,4 2010 2011 2012 2013 2014 2015 2016 2017 -25,0 -22,0 EBITDA Operating cash flow OCF/EBITDA 2010 2011 2012 2013 2014 2015 2016 2017 Eurocash EBITDA margin % vs. gross salary and inflation in PL New Projects EBIT (PLN m)

2015 2016 2017 New initiatives impact 5,0% 4,5% 4,4% 5,0% 0 short term profitability 4,3% 3,9% 3,7% 3,7% -10 but for our clients are 4,0% 4,0% 3,0% 3,0% -20 2,7% investment into future 3,0% 2,4% 2,4% 2,3% 3,0% 2,1% -30 -19 competitiveness 2,0% 2,0% 2,6% 1,6% 2,0% 0,9% -40 0,8% 1,0% 2,0% 1,0% -50 -0,2% -43 0,0% 0,9% 0,0% -60 -53 -1,0% 0,0% -1,0% -0,9% -0,6% -2,0% -2,0% Clear potential to 2010 2011 2012 2013 2014 2015 2016 2017 increase profits Eurocash EBITDA margin % Gross Salary CPI (Inflation)  We kept investing despite unfavorable macro trends and growing costs of innovative projects

* 2017 adjusted by one-off items, VAT issue 8 After many years of growth we are now able to focus on profitability

150 M PLN by 2020 - identified potential for cost reduction WHOLESALE RETAIL

Head Office EC C&C Logistics: ECD Merger with ECA Retail Head Office cost optimization restructuring then ECS impulse cost optimization

~60m PLN ~10m PLN ~40m PLN up to~40m PLN

(2019-2020) (2020)

1H 2018 EBITDA* evolution (PLN m) 160,2 142,8 142,1 +12.8% -0.5% Improvement 1,81% -0.7m 1,74% +18.1m 1,87% of Wholesale EBITDA

1H 2016 1H 2017 1H 2018 EBITDA EBITDA margin %

9 Eurocash is now fast developing own retail, going for further scale Own retail chain based on the franchise chain and on development of own small supermarket stores

7.4 bn PLN 1 527 stores +900 stores +5 bn PLN > By 2023 > Retail Sales 538 3,1 Own Acquisitions

Green Field 989 4,3 Franchise Franchise Chain

Retail Sales Number (PLN bn) Of Stores Standardized business with unified processes

NEIGHBOURHOOD HIGH QUALITY OF PERSONALIZED E-GROCERY FOR BIG CITIES STORE PERISHABLES PROMOTIONS > Home delivery & pick in store > Proximity > Delivered Everyday > CRM System

10 Eurocash Retail is growing much faster than supermarket competition High valued retail chains are increasing scale few times slower than Eurocash Retail

Sales area in square meters (thsd, 2016 and 2017) Number of Stores (2016 and 2017)or 2016 and 2017 For 2016 and 2017 41% 66% Eurocash Retail 500 24% 1 750 1 527 Sales Area 394 23% 400 13% 1 500 Dynamics 17% 295 1 250 1 086 300 242 238 237 215  66% 1 000 775 200 750 628 437 100 500 372 Sales 250 Dynamics 0 0 Eurocash Retail Stokrotka* Dino** Eurocash Retail Stokrotka* Dino**  60% (DC+Eko+Mila) (DC+Eko+Mila)*** Avg. annual sales per sqm (thsd, 2017) Sales revenues (PLN bn, 2016 and 2017) Number of Stores For 2016 and 2017 25,0 60% Dynamics 34% 20,1 8,0 7,4  41% 20,0 18,1 8% 16,2 16,9 7,0 15,0 6,0 5,0 4,6 4,5  Delikatesy 10,0 4,0 3,4 Centrum sales density higher than 3,0 2,3 2,5 5,0 competition by 2,0 1,0 app. 20% 0,0 Delikatesy Centrum Eurocash Retail Stokrotka* Dino** 0,0 (ex. Eko & Mila) (DC+Eko+Mila) Eurocash Retail (DC+Eko+Mila)*** Stokrotka* Dino**

*PMR 2018 ** Company reports, sales per sqm estimation based on reports 11 *** 2016: before M&A (EKO & Mila) Innovative solutions for our clients are coming into play Thanks to investments and innovative solutions not available for large format players, small stores have ability to win

E-commerce B2B CRM Fresh Project Training

> Online store and mobile app > CRM platform available for all > Successfully developed in > Training for owners and their > Market & local competition clients Delikatesy Centrum employees insights > Customized promotion for each > Roll-out to ECD franchisees > Facilitates succession > Financial & delivery consumer visiting franchise store > First nationwide fresh > E-Learning, Workshops, Congresses information > B2C platform, based on product distribution with & Postgraduate Business Studies Sales: 2.9 bn PLN DeliKarta mechanism everyday morning delivery

12 Going forward, extended roll-out of projects will create further value Extension of initiatives to full customer-base will ensure future competitiveness of both Wholesale and Retail

FRESH PROJECT extension Our investment in the future Break even point much faster than expected

01 Faktoria Win 05 Further potential for growth: Piwne Terytoria Duży Ben  Increase of Delikatesy Centrum penetration  Extension to Lewiatan, Gama, Euro Sklep, Groszek chains 02 06  Expansion with own retail chain Kontigo Private Labels

Fresh Project sales evolution (PLN m) 156 03 07 137 146 121 132 Pay Up Sushi To Go 98 83 57 35 45 04 abc na kołach 08 4 Vapers 1Q 2016 2Q 3Q 4Q 1Q 2017 2Q 3Q 4Q 1Q 2018 2Q

 Faktoria Win – already brought back wine category to small stores

 Duży Ben may take advantage from neighborhood discounters traffic generation

 Fresh Project – is a must to strengthen brand perception against competition

13 Executive summary

Traditional trade is still half of the FMCG market, supported by Eurocash, and growing (especially small supermarkets) despite lower inflation of their category mix,

Cash generation has allowed ongoing Eurocash investments in sales growth and innovation initiatives, albeit in recent years at the expense of EBITDA in tough market conditions,

Today, optimized costs and nationwide logistics provide a solid base for Wholesale’s modernization with: digital ordering platform, CRM, perishables and a new format roll-out,

Going forward with investment in Retail, a nationwide supermarket chain is now in place which is to grow by 900 stores in 5 years to 13 bn PLN,

1H 2018 show results under control in sales, gross margin and costs.

14 APPENDIX 1H 2018 Results

15 1H 2018 Results Summary

WHOLESALE - STRONG GROWTH RETAIL – 187 MILA STORES ACQUIRED with sales +5,3% and EBITDA +12,8% Integration work in progress. YoY in 1H 2018 149 EKO stores under Delikatesy Centrum brand

PROJECT FRESH CLOSE TO BREAK EVEN with 301m PLN sales in 1H 2018 (+82m PLN)

STRONG CASH FLOW GENERATION NET DEBT UNDER CONTROL at 1.6x LTM EBITDA at 1.9x EBITDA, despite M&A and dividend payment (-450m pln)

STRONG IMPROVEMENT IN WHOLESALE, PREPARING GROUND FOR RETAIL

16 Wholesale Segment – back on growth track with Cash&Carry turnaround

1H 2018 Sales evolution (PLN m) 1H 2018 EBITDA evolution (PLN m)

+5.3% +12.8% 8 155 8 590 -0.5% 160,2 7 885 +3.4% 142,8 142,1 +475m +18.1m +270m -0.7m

1,87% 1,81% 1,74%

1H 2016 1H 2017 1H 2018 1H 2016 1H 2017 1H 2018 EBITDA EBITDA margin %

 Strong performance improvement in 1H 2018 with sales +5.3%, EBITDA +12.8% and EBIT +21.7% YoY.

 Gross margin stabilized at flat level with further potential to improve. Cost pressure covered by improved efficiency.

 CC LFL +2.7% in 2Q and +2.2% in 1H 2018 YoY. Best result in last 17 quarters.

 ECD with +10% sales increase in 1H YoY. ECS already stabilized, +5.1% sales increase in 1H YoY.

17 Wholesale sales dynamics Wholesale segment supported by increased competitiveness of its clients

C&C LFL Wholesale sales evolution (1H 2018 YoY) 3,6% 2,6% 2,7%

1,3% 1,5% Wholesale 5,3% 0,7% 0,0% 0,3% 0,3% -0,4% Cash&Carry 2,1% -1,3% -2,2% Tobacco & Impulse 5,1% -2,7% -3,5% -3,6% -4,0% Distribution 10,0% -4,6% -4,9% -5,2% Alcohol -0,8% 4Q'13 1Q 2Q 3Q 4Q'14 1Q 2Q 3Q 4Q'15 1Q 2Q 3Q 4Q'16 1Q 2Q 3Q 4Q'17 1Q 2Q Food Service 12,2%

 C&C LFL in 2Q 18 at +2.69% and 2.16% in 1H 2018 - best performance in last 17 quarters.

 Tobacco with stable 5% sales growth in 1H 18. Business already stabilized.

 ECD sales driven by franchisees (Lewiatan, PSD, Euro Sklep, Groszek) and gas stations.

18 Retail – increased asset base, ongoing integration 149 EKO stores under Delikatesy Centrum brand. Mila integration planning started

1H 2018 Sales evolution (PLN m) 1H 2018 EBITDA evolution (PLN m) +43% 2 361 incl. Mila pro forma +37.6% 74,3 -27.9%

+7.4% -21m +44.3% 1 771 +20m EKO integration 1 649 54,0 53,6 +506m +123m 1 142 4,72% 4,50% EKO + Mila consolidation 3,02%

1H 2016 1H 2017 1H 2018 1H 2016 1H 2017 1H 2018 EBITDA EBITDA margin %  Sales increase driven by M&A. June 2018 Mila sales at 120.4 m PLN.

 5Y plan +900 openings sustained. Half of 2019 own stores expansion already addressed with small chains M&A.

 Retail strategy sustained – needs to play as complimentary to franchisees, wholesale clients and the Group.

 Delikatesy Centrum LFL in 1H 2018 LFL + 4.5% in wholesale and +0.9% in retail. 2Q 2018: +0.9% in wholesale and -1.8% in retail (Easter effect).

19 Polish market – potential for proximity stores development There is a space for new selling area in the market

Sales area (m2) per capita 2017 Criteria for selection of grocery stores for the 10 most popular chains (%) Belgium 1,67 Austria 1,66 Close to my home 69% Netherlands 1,59 Affordable prices 41% Switzerland 1,50 A wide range of products 27% Luxembourg 1,47 Germany 1,44 Other: high quality products 12% Denmark 1,43 They always have what I come for 12% Norway 1,30 Attractive promotions / discounts 12% Sweden 1,27 Shopping is fast 7% France 1,20 Estonia 1,18 Attractive products of the brand of a store 5% Spain 1,13 Interesting / inspiring products 5% Lithuania 1,13 A lot of Polish products 4% Croatia 1,13 The Polish origin of this store 3% United Kingdom 1,09 Latvia 1,05 Do not overwhelm the surface / number of products 3% Italy 1,04 Attractive loyalty program 3% Czech Rep. 1,04 Offer new products 2% Hungary 1,03 Slovakia 1,01 0% 10% 20% 30% 40% 50% 60% 70% 80% Portugal 0,99 Poland 0,98  Poland - country with one of the lowest selling area per one person in Europe Bulgaria 0,75 Romania 0,72 Turkey 0,67  Proximity the most valued for Polish consumers

20 Projects – investments (at EBITDA level) into future growth Fresh Project close to break even

1H 2018 Sales evolution (PLN m) 1H 2018 EBITDA evolution (PLN m)

+91m 338 1H 2016 1H 2017 1H 2018

+145m 247

-7,8% 102 -15,4 -11m -10,7% +0.2m

-26,4 -26,2 1H 2016 1H 2017 1H 2018 -15,1% EBITDA EBITDA margin %

 Fresh Project with 302m PLN sales in 1H 2018 (+82m) close to break even in 2Q 2018.

 Most relevant for Delikatesy Centrum positioning and competitiveness.

 Duży Ben & Kontigo – moved into proven for many years franchise system.

21 1H 2018 financial summary Strong sales increase driven by wholesale segment

% of Sales % of Sales PLN m 1H 2017 1H 2018 Y/Y Change  Sales driven mainly by wholesale segment 1H 2017 1H 2018 (+435m PLN) and consolidation of Mila Net sales 10 118 10 776 7% (+120m PLN).

Gross profit 1 186 1 288 11.7% 11.9% 9%  Gross Margin stabilized after 1H 2018. Increase by 0.22 p.p. YoY driven by retail EBITDA 184 186 1.8% 1.7% 1% (excl. Projects, normalized*) segment and consolidation of Mila. EBITDA normalized* 158 160 1.6% 1.5% 1%  Normalized EBITDA increase by 1%, driven One-off costs* -114 -3 by wholesale segment, and off-set by EKO EBITDA reported* 43 157 0.4% 1.5% 261% stores remodeling. EBIT normalized* 68 64 0.7% 0.6% -6%  Depreciation driven by retail segment. Profit before tax normalized* 51 45 0.5% 0.4% -11%  Net Profit affected by increased effective tax Net profit 38 21 0.4% 0.2% -46% rate due to changes in law.

* 2018 results normalized by costs of Mila M&A, 2017 by add. VAT tax payment 22 2Q 2018 financial summary Strong sales increase driven by wholesale segment

% of Sales % of Sales PLN m 2Q 2017 2Q 2018 Y/Y Change 2Q 2017 2Q 2018  Sales driven mainly by wholesale segment

Net sales 5 467 5 775 6% (+166m PLN), and consolidation of Mila (+120m PLN).

Gross profit 655 706 12.0% 12.2% 8%  Gross Margin increase by 0.24 p.p. YoY EBITDA 131 132 2.4% 2.3% 1% - stable in wholesale segment, driven by Mila. (excluding Projects, normalized) EBITDA normalized* 120 120 2.2% 2.1% 0%  EBITDA driven by wholesale segment, and One-off costs* 114 3 off-set by EKO stores remodeling. EBITDA reported* 5,9 117,0 0.1% 2.0% 1894%  Depreciation driven by retail segment. EBIT normalized* 74,8 70,6 1.4% 1.2% -6%  Net Profit affected by increased effective tax Profit before tax normalized* 66,7 62,0 1.2% 1.1% -7% rate due to changes in law.

Net profit 52,6 39,0 1.0% 0.7% -26%

* 2018 results normalized by costs of Mila M&A, 2017 by add. VAT tax payment 23 EBITDA* performance by segments

1H 2018 EBITDA by segments +18.2m -20.7m +0.2m +4.1m +1.9m 160,2 157,8 159,6 142,1

74,3 53,6

-26,4 -26,2 -32,1 -27,9 Wholesale Retail Projects Others Eurocash Group -30.9m 1H 2017 1H 2018 incl. one-off costs (Mila acquisition fees)

STRONG FOCUS ON: C&C increasing LFL and profitability EKO integration – short-term impact Fresh Project improving results, Costs improvement • WHOLESALE OPTIMIZATION on profitability close to break even, EC Distribution 10% sales increase positive EBITDA in 2H 18 expected • RETAIL INTEGRATION DC own stores above expectations

Tobacco impacting 1H results but • COSTS CONTROL DC Franchise improvement of already stabilized with high potential profitability, focus on Fresh Project for growth in next quarters

* 2018 results normalized by costs of Mila M&A, 2017 by add. VAT tax payment 24 Cash Flow LTM Operating CF at 168% EBITDA

Cash conversion cycle (restated after IFRS 15) PLN m 1H 2017 1H 2018 2Q 2017 2Q 2018 40 31 31 28 30 30 27

Net operating cash flow 171 186 256 240 20 25 23 21 24 24 24 Net profit (loss) before tax (64) 42 (48) 59 0

Depreciation 90 96 45 49 -20 ( 21) ( 21) ( 22) Change in working capital 141 63 243 150 -40 ( 27) ( 23) ( 25) Other 4 (15) 15 (18) -60 ( 75) ( 71) ( 76) ( 76) ( 81) ( 77) Net investment cash flow (204) (378) (65) (338) -80

Net financial cash flow 25 138 (175) (251) -100 Q1 2017 Q2 Q3 Q4 Q1 2018 Q2 Total cash flow 8 (54) 15 (349)

Receivables Stock Cash conversion Liabilities

Strong cash generation sustained in 1H 2018. Strong improvement of receivables rotation in wholesale segment

25 Net debt vs. normalized** LTM EBITDA Strong Cash Flow sustained 800 2,0 Net Debt* vs. 12M EBITDA in 2Q 2018 1,90 700 1,8 1,6 600 1,36 1,29 1,10 1,11 1,4 500 1,02 1,2 400 0,93x 1,0 300 0,8 335 0,6 200 excl. M&A 0,4 100 431 584 441 486 419 464 361 370 363 468 360 684 0,2 0 0,0 1Q'17 2Q 3Q 4Q 1Q'18 2Q LTM EBITDA (PLN m) NET DEBT (PLN m) NET DEBT / EBITDA

 Net Debt increase by 214m PLN despite payment of dividend (102m) and Mila acquisition (350m) in 2Q 2018.

*NET DEBT - the sum of long and short term loans, borrowings and financial liabilities less cash and cash equivalents

**Adjusted for one-off item – 114 m PLN potential VAT liability payment done in Aug 2017 26 Eurocash Group business portfolio Cash from mature wholesale is invested in retail growth and innovation

Faktoria Win

27 Disclaimer

This presentation and the associated slides and discussion contain forward-looking statements. These statements are naturally subject to uncertainty and changes in circumstances. Those forward-looking statements may include, but are not limited to, those regarding capital employed, capital expenditure, cash flows, costs, savings, debt, demand, depreciation, disposals, dividends, earnings, efficiency, gearing, growth, improvements, investments, margins, performance, prices, production, productivity, profits, reserves, returns, sales, share buy backs, special and exceptional items, strategy, synergies, tax rates, trends, value, volumes, and the effects of Eurocash S.A. merger and acquisition activities. These forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include, but are not limited to developments in government regulations, foreign exchange rates, oil and gas prices, political stability, economic growth and the completion of ongoing transactions. Many of these factors are beyond the Company's ability to control or predict. Given these and other uncertainties, you are cautioned not to place undue reliance on any of the forward looking statements contained herein or otherwise. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements (which speak only as of the date hereof) to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as maybe required under applicable securities laws. Statements and data contained in this presentation and the associated slides and discussions, which relate to the performance of Eurocash S.A. in this and future years, represent plans, targets or projections.

For more information please contact: Cezary Giza Investor Relations Director

[email protected] mobile: +48 693 930 415

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