2019-2020 MILESTONES 2019-2020 MILESTONES 2019-2020 Contents

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2019-2020 MILESTONES 2019-2020 MILESTONES 2019-2020 Contents 2019-2020 MILESTONES 2019-2020 MILESTONES 2019-2020 Contents 01 Profile 19 Financial performance 02 Worldwide presence 22 Sustainable development / CSR 04 Message from Arnaud Lagardère 27 The Jean-Luc Lagardère Foundation 07 Strategy 28 Lagardère Publishing 10 Governance 38 Lagardère Travel Retail 16 Meeting the shareholders 48 Our story 2019-2020 MILESTONES PROFILE Profile Created in 1992, Lagardère is an international group with operations in more than 40 countries worldwide. It employs over 30,000 people and generated revenue of €7,211 million in 2019. Under the impetus of the Group’s General and Managing Partner, Arnaud Lagardère, the Group launched a strategic refocusing around two priority divisions: Lagardère Publishing is the world’s third-largest Lagardère Travel Retail is the world’s fourth largest book publisher for the general public and educational travel retail merchant, with operations in three markets, and the leader in France. Alongside segments of this very dynamic field: Travel Essentials, some 6,900 employees, it creates 17,000 original Duty Free & Fashion, and Foodservice. Lagardère publications each year as well as contributing to Travel Retail has 25,000 employees across an their broader circulation by innovating with digital international network of more than 4,800 points and mobile reading formats. Lagardère Publishing’s of sale in around one thousand airports, mainline activities also extend to adjacent businesses such and urban train stations. as Mobile Games and Board Games. The Group’s business scope also includes Lagardère News (Paris Match, Le Journal du Dimanche, Europe 1, RFM, Virgin Radio and the Elle brand licence) together with Lagardère Live Entertainment. The Lagardère Studios unit is in the process of being sold. Through this strategic refocusing, the Lagardère group is investing in its two strategic divisions with the aim of creating global leaders over the long term. Lagardère shares are listed on Euronext Paris. The Orion Publishing Group 22 mm minimum LAGARDÈRE RETAIL 63776 RELAIS H CAFÉ - LOGOTYPE DRAGON ROUGE C=80 C=5 M=40 M=5 Y=100 Y=5 K=35 K=0 C=0 M=22 Y=84 K=0 2019.09.25 2019-2020 MILESTONES . 1 WORLDWIDE PRESENCE Worldwide presence BREAKDOWN OF 2019 REVENUE by geographic area 28% FRANCE 24% WESTERN EUROPE Countries in which the Lagardère group operates 25% 11% UNITED STATES AND CANADA EASTERN EUROPE 10% 2% ASIA-PACIFIC OTHER COUNTRIES 2 . 2019-2020 MILESTONES WORLDWIDE PRESENCE FRANCE 22 mm minimum LAGARDÈRE RETAIL 63776 RELAIS H CAFÉ - LOGOTYPE DRAGON ROUGE C=80 C=5 M=40 M=5 Y=100 Y=5 K=35 K=0 C=0 M=22 Y=84 K=0 2019.09.25 EUROPE AFRICA AND MIDDLE EAST NORTH AMERICA Pantone 301 Pantone Warm Gray 11 Pantone Warm Gray 6 LATIN AMERICA ASIA-PACIFIC 2 . 2019-2020 MILESTONES 2019-2020 MILESTONES . 3 MESSAGE FROM ARNAUD LAGARDÈRE Message from Arnaud Lagardère Ladies and Gentlemen, dear Shareholders, forecasts, posting recurring EBIT of €361 million for the target scope. 2019 was a year of transformation and refocusing for the Lagardère group. Within the context of this transformation, I would like to emphasise the importance I place on our Our strategy is now concentrated on two priority CSR policy, which is now integral to how businesses areas: Lagardère Publishing, our power engine, are assessed and valued. We have identified three and Lagardère Travel Retail, our growth engine. priorities which will continue to guide our efforts in this area: placing people at the heart of our strategy, These two divisions are highly complementary reducing the environmental impact of our products in terms of growth and profitability and will give and services, and sharing the social and cultural the Group a more coherent profile, as regards diversity of our businesses. both industry leadership and market development. Our efforts over the past few years to give our Even though it has involved some painful decisions, Group a renewed attractiveness and to create this deep-seated transformation means that we can value for our shareholders will continue apace continue expanding our two businesses – among despite the current crisis. Our achievements the leaders in their industries – thereby guaranteeing would not have been possible without the the Group’s robustness and staying power. unwavering commitment and talent of all of The disposals carried out as part of our strategic our employees, to whom I am sincerely grateful. refocusing have given us the resources we needed to The Covid-19 epidemic which first emerged in China strengthen our divisions on their respective markets, at the beginning of 2020 before spreading to the with several large-scale acquisitions finalised in 2019. rest of the world is having a significant impact on These included Gigamic, Short Books and Blackrock our businesses, and particularly Travel Retail. At the Games at Lagardère Publishing, and International date of this document, it is not currently possible Duty Free (IDF) at Lagardère Travel Retail. to foresee how this unprecedented crisis will develop going forward. Given this context, we have decided to suspend the guidance announced on 27 February " These two divisions are highly 2020, and have rolled out a cost-cutting plan in agreement with our customers and partners. complementary in terms I would like to stress that since the early days of the epidemic, the Group’s primary concern of growth and profitability has been how best to protect our employees, whose dedication and adaptability has been and will give the Group outstanding throughout this challenging period. For these reasons, and in order to reflect the a more coherent profile" appropriate solidarity and corporate responsibility in the current climate, the Managing Partners, in agreement with the Supervisory Board, have decided Revenue for Lagardère Publishing came in at to withdraw the proposed dividend in respect of 2019. €2,384 million for 2019, up 5.9% on a consolidated basis and up 2.8% like for like. Recurring EBIT I would like to thank all of our shareholders climbed 10% to €220 million. Lagardère Travel for their loyalty and support. Retail also delivered growth, with revenue up 16.1% on a consolidated basis (up 6.3% like for like) at €4,264 million, and recurring EBIT €31 million higher Arnaud Lagardère at €152 million. We emerged from 2019 with a streamlined profile and having delivered on our 4 . 2019-2020 MILESTONES MESSAGE FROM ARNAUD LAGARDÈRE " Our efforts over the past few years to give our Group a renewed attractiveness and to create value for our shareholders will continue apace despite the current crisis" 2019 General Meeting (Paris, France). 4 . 2019-2020 MILESTONES 2019-2020 MILESTONES . 5 MANAGEMENT TEAM C E O IV M T M U IT C T E E X ARNAUD LAGARDÈRE E E General and Managing Partner, Lagardère SCA PIERRE LEROY THIERRY FUNCK-BRENTANO Co-Managing Partner, Co-Managing Partner, Lagardère SCA Lagardère SCA RAMZI KHIROUN GÉRARD ADSUAR Spokesperson, Lagardère SCA Chief Financial Officer, Chief External Relations Lagardère SCA Officer ARNAUD NOURRY DAG RASMUSSEN Chairman and Chief Executive Chairman and Chief Executive Officer, Hachette Livre Officer, Lagardère Travel Retail CONSTANCE BENQUÉ ÉRIC THOMAS ISABELLE JUPPÉ Chief Executive Officer, General Counsel, CSR Director, Lagardère News Lagardère SCA Lagardère SCA COMEL* * Enlarged Committee. 2020 It assists the Managing Partners, The Managing Partners are who are members of the Committee, also supported by the Enlarged management team in their duties, which are: Committee, which is made up of the members of the The Executive • determining the Group’s strategy; Executive Committee plus Committee’s • guiding its development and control; the division senior executives, role is to share the Chief Executive Officer • taking the major management information and of Lagardère News and the decisions required for this and ensuring General Counsel and Corporate coordinate actions those decisions are implemented Social Responsibility Director taken by the both at the level of the parent of Lagardère SCA. It meets Managing Partners. company and in the various divisions. every month. 6 . 2019-2020 MILESTONES STRATEGY Strategy 2019 General Meeting (Paris, France). Value creation is central to the Lagardère group's strategic refocusing and leads to better strategic readability in pursuit of higher cash flow generation and significant savings. The Group’s strategy has also been devised to build the global leader in each of its two business segments of Publishing and Travel Retail. A GROUP REFOCUSED AROUND TWO PILLARS As announced by Arnaud Lagardère at the annual results presentation on 8 March 2018 and at the Annual General Meeting of 3 May 2018, the Group has been refocusing around its two priority divisions: Lagardère Publishing, the power engine, and Lagardère Travel Retail, the growth engine. These two divisions are each among the world leaders in their respective businesses and accounted for more than 90% of Group revenue in 2019. The main objectives of the strategic refocusing are as follows: • to endow the Group with an improved, simpler, more ambitious and more focused business profile; • to improve cash generation in order to fund the growth of the Group’s two priority divisions. 6 . 2019-2020 MILESTONES 2019-2020 MILESTONES . 7 STRATEGY I NMPLEME TATION OF THE ASSET In addition, the Audiovisual Production DISS PO AL PLAN and Distribution division (Lagardère Studios) is in the process of being sold. As part of the refocusing process, the Group has been divesting the assets making up Lagardère Active, Lastly, the Group has received an offer to purchase excluding Lagardère News. Since 2018, it has sold: 75% of Lagardère Sports (excluding Lagardère Live Entertainment). • the stake in Marie Claire in June 2018; DEVELOPMENT OF THE PRIORITY DIVISIONS • the radio businesses in the Czech Republic, Poland, Slovakia, Romania (July 2018) and The proceeds from these disposals are reinvested first Africa (February 2019); and foremost in Lagardère Publishing and Lagardère Travel Retail, to provide them with the means to • the e-Health unit with MonDocteur (July 2018), become fixtures among the global leaders in their Doctissimo (October 2018) and Doctipharma respective segments.
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