Extra-Financial Performance Declaration
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EXTRA-FINANCIAL PERFORMANCE DECLARATION 2020 CONTENTS 1 3 PRESENTATION OF THE GROUP 1 RISK FACTORS 1.1 / Business Model NFPD 2 AND MANAGEMENT NFPD 121 1.2 / History 14 3.1 / Risks related to changes in the economic model 124 1.3 / 2020, a year marked by an unprecedented 3.2 / Security risks 131 health crisis 16 3.3 / Regulatory risks 133 1.4 / Fnac Darty markets and offering 22 3.4 / Financial risks 135 1.5 / Group strategy and objectives: 3.5 / Risk management associated a new Everyday strategic plan 32 with the Covid-19 health crisis 137 1.6 / Innovation, a Group priority 35 3.6 / Insurance 138 1.7 / Store network and proprietary real estate 36 3.7 / Risk management 140 1.8 / Regulatory environment and changes 39 1.9 / Research and Development, patents and licenses 40 2 NON-FINANCIAL PERFORMANCE DECLARATION NFPD 41 Introduction 42 2.1 / Develop our most valuable asset: people 51 2.2 / Promote sustainable consumption and an educated choice 64 2.3 / Contribute to the economic, social and cultural development of regions 77 2.4 / Reduce impacts on the climate 81 2.5 / Ensuring exemplary business conduct 97 2.6 / Summary of published indicators and KPI 111 2.7 / Methodology note 114 2.8 / Independent Third-Party Report by one of the Statutory Auditors on the Consolidated Non-financial Performance Declaration 118 The items related to the Non-financial Performance Declaration (DPEF) are identified in the section headings using the pictogram NFPD 1 Presentation of the Group 1 1.1 / Business Model 2 1.4 / Fnac Darty markets and offering 22 1.1.1 / Company Profile 2 1.4.1 / Description of markets 22 1.1.2 / A business model that creates sustainable 1.4.2 / Market trends 22 value for our stakeholders 9 1.4.3 / A diversified product and services offering 24 1.1.3 / Market challenges, sources of opportunity 12 1.4.4 / Geographical breakdown 30 1.2 / History 14 1.5 / Group strategy and objectives: 1.2.1 / History of Fnac 14 a new Everyday strategic plan 32 1.2.2 / History of Darty 15 1.5.1 / Embodying new standards for successful digital and human omnichannel retail in the future 32 1.2.3 / History of Fnac Darty 16 1.5.2 / Helping consumers adopt sustainable practices 33 1.3 / 2020, a year marked by 1.5.3 / Rolling out the benchmark subscription-based an unprecedented health crisis 16 home assistance service 33 1.3.1 / Fnac Darty’s unique and highly agile 1.5.4 / Financial outlook and mid-term ambitions 34 omnichannel model and solid business execution 17 1.3.2 / Finalization of the sale of BCC in the Netherlands 1.6 / Innovation, a Group priority 35 to Mirage Retail Group 18 1.3.3 / Continuation of initiatives to innovate 1.7 / Store network and proprietary and diversify the Fnac Darty offer 18 real estate 36 1.3.4 / Growth in 2020 revenues in the context 1.7.1 / Store network 36 of an unprecedented health crisis 19 1.7.2 / Proprietary real estate 38 1.3.5 / Impact of the transition to IFRS 16 20 1.3.6 / A diversified financing structure 20 1.8 / Regulatory environment 1.3.7 / Governance and shareholding 21 and changes 39 1.9 / Research and Development, patents and licenses 40 EXTRA-FINANCIAL PERFORMANCE DECLARATION 2020 FNAC DARTY 1 PRESENTATION OF THE GROUP 1 Business Model 1.1 / Business Model 1.1.1 / COMPANY PROFILE 1.1.1.1 / A European leader the Covid crisis. In contrast, the attraction of digital platforms in omnichannel retail skyrocketed, experiencing a very sharp rise in traffic thanks to the uptick in digitalization of consumption which the health crisis Operating in 12 countries, including France, Belgium, Spain, entailed. Portugal and Luxembourg, Fnac Darty is a European leader in the The Group thus operates primarily in Europe via three regions: retail of entertainment and leisure products, consumer electronics France and Switzerland, Belgium and Luxembourg, and the and domestic appliances. More recently, the acquisition in August 2019 of Nature & Découvertes, a leading omnichannel Iberian Peninsula. The France and Switzerland region covers the retailer of natural and wellbeing products, enabled the Group to Group’s French and Swiss activities and represented close to 83% penetrate the Wellbeing and Outdoor Activities sectors and, in of sales in 2020. The Belgium-Luxembourg region covers the doing so, accelerate its diversification. activities of Fnac and Vanden Borre in Belgium and Luxembourg and represented nearly 9% of sales in 2020. Lastly, the Iberian With some 25,000 employees, Fnac Darty generated revenue of Peninsula region covers Fnac activities in Spain and Portugal, nearly €7.5 billion in 2020, 29% of which was online, up 10 points and represented almost 8% of revenue in 2020. The Group is on 2019. By combining the strengths of Fnac, Darty and Nature & also developing its franchise business internationally and now has Découvertes, the Group’s omnichannel sales accounted for 42% 13 stores in Africa and the Middle East, and 17 stores in French of online orders in 2020, against a backdrop of very strong growth overseas departments and territories. in e-commerce volumes. As a result, momentum remained very strong, with click&collect order processing up 30% on the previous In its geographic regions, the Group reproduces the strategy year. implemented in France, adjusted to the local context. This is mainly through a strong network of directly owned stores, as well The relevance of the omnichannel model is based on a dense as franchise development. Fnac Darty has solid e-commerce territorial network combined with sustained momentum on digital platforms in all its countries, with five main international websites platforms. As of the end of 2020, the Group has a multi-format and partnerships with specialist sites. Along with these country- network of 908 stores, including 751 in France (1). It is France’s specific initiatives, the Group is rolling out a single platform for all second largest e-commerce retailer in terms of audience in sellers, so they can connect to the countries that are most relevant France with its three commercial websites: fnac.com, darty.com, to them within the Marketplaces ecosystem. and natureetdecouvertes.com. Its position as leader is based, in particular, on its high volume of traffic: 175 million visits to stores By bringing together its in-store and digital offerings, the Group can across the Group and a cumulative average of over 29 million provide innovative services, such as “click&mag”, “click&collect” unique online visitors per month in France (2). It should be noted and the express or by-appointment delivery offering. These that in-store traffic in 2020 was strongly impacted by the lockdown services guarantee seamless integration of the in-store and online measures and limits on in-store traffic adopted in response to purchasing experience. (1) Including 16 Fnac Darty/N&D stores in Switzerland and 30 stores abroad. (2) Fevad, average for 2020. 2 EXTRA-FINANCIAL PERFORMANCE DECLARATION 2020 FNAC DARTY PRESENTATION OF THE GROUP Business Model The Group’s omnichannel experience is outlined below. A DENSE NETWORK A GROWING STRONG OMNICHANNEL OF DIRECTLY FRANCHISE DIGITAL & SERVICES OWNED STORES NETWORK PLATFORMS BELGIUM- 85 stores: Kitchen stores, Fnac.be and Marketplace Logistics platforms LUXEMBOURG • 13 Fnac as franchises Vandenborre.be Click&collect 8% • 72 Vanden Borre After-sales service of revenues 2020 FRANCE- 412 stores: 339 stores: Fnac.com and Marketplace Logistics platforms SWITZERLAND • 100 Fnac • 122 Fnac Darty.com and Marketplace After-sales service 83% • 223 Darty • 209 Darty Fnac.ch Click&collect of revenues 2020 • 89 Nature • 1 Fnac Darty Natureetdecouvertes.com Click&mag & Découvertes • 7 Nature and Marketplace & Découvertes IBERIAN 67 Fnac stores 5 Fnac stores Fnac.es and Marketplace Logistics platforms PENINSULA Fnac.pt and Marketplace After-sales service 1 9% Click&mag of revenues 2020 AND OTHER REGIONS: Ivory Coast, Morocco, Tunisia, Congo, Cameroon, Qatar, French overseas departments and territories Store network as of December 31, 2020. 1.1.1.2 / A galaxy of brands orbiting As for Darty, its identity is anchored in three key values: confidence, Fnac and Darty service and accessibility. Darty, a heritage brand, is the brand for everyone. It is there for its customers at every stage of their lives, Since their creation more than 60 years ago, both Fnac and Darty from the big moments to the smallest ones. Part of French homes have strived to embed their values and promote their deeply for 60 years, it is a pioneer in terms of service, especially after- held convictions. In 2016, Fnac Darty was created from the sales services. merger of these well-known brands, both of which boast strong Since the merger between Fnac and Darty, the Group has reputations and excellent consumer loyalty. These two brands have expanded to include new brands to form a major specialized complementary positions and missions. retail group. The Group has recently strengthened its presence Three strong values make up the essence of the Fnac brand: in the ticketing sector with the consolidation of Billetreduc.com independence, passion and the spirit of discovery. These values and increased its offering in the express repair of electronic are reflected in its salespeople, in its recognized expertise and in devices, first in France in 2018 with the acquisition of WeFix and its product selections, as well as in the unique place that Fnac then in Portugal in 2019 with the consolidation of PC Clinic. The occupies in French culture (Fnac Live Paris, the Fnac Livres book acquisition of Nature & Découvertes in 2019 represents the most fair, the Prix BD Fnac France Inter comic prize in association with significant external growth transaction since the merger of Fnac French national radio, the Prix Goncourt des lycéens literary prize and Darty.