We are PPF. Another year. Another annual report. Another set of figures. But PPF is more than just numbers and profits. PPF is the projects we have created. PPF is the markets we have developed. PPF is people. We are PPF. PPF PPF GROUP ANNUAL REPORT 2019 CONTENTS 4 PPF Group Annual Report 2019 6 42 64 HEUREKA Foreword Selected PPF Group Companies 65 10 CZECHTOLL 43 PPF Group PPF FINANCIAL HOLDINGS 66 O2 ARENA 11 44 GROUP PROFILE HOME CREDIT 68 12 46 Significant Events DESCRIPTION OF THE AIR BANK COMPANY PPF GROUP N.V. at PPF Group 48 12 PPF BANKA 72 SELECTED FINANCIAL Corporate Social HIGHLIGHTS OF PPF GROUP 50 PPF TELECOM GROUP Responsibility 13 and the Support SHAREHOLDERS 51 of Culture TELENOR CEE 20 52 78 Governing Bodies CETIN PPF Group 54 History 38 O2 CZECH REPUBLIC PPF Group Major 82 Assets 56 SOTIO Financial Section 58 ŠKODA TRANSPORTATION 204 Contacts 60 PPF REAL ESTATE HOLDING 62 PPF LIFE INSURANCE 63 MALL GROUP Contents 5 FOREWORD 6 PPF Group Annual Report 2019 Dear Friends, When I started doing business thirty years ago, one of my aims was to prove that we Czechs have what it takes Never in the existence of PPF has there been such a diver- to succeed in the world, to be among the very best. PPF gence between the world that our Annual Report describes managed to do that. We truly are a large global company. and the world in which it is being published. In 2019, the But we could never have conquered the world without world was thriving. putting down roots in our home in the Czech Republic. To repeat what I wrote in last year’s Annual Report: we As was PPF. We were going from strength to strength as must never forget our roots and what has shaped us. This both a creative and progressive force. We had successfully is why we at PPF cultivate Czech potential and why we moved forward with several major projects, including the build on our people, their knowledge, experience, ingenuity, acquisition of the CME media group, a billion-euro bond professionalism, creativity, drive and diligence. issue to finance our telco business, and the establishment and successful launch of a new toll system in the Czech We know that every crisis is also an opportunity, and that Republic. Of course, as happens every year, some of our problems are there to be confronted and resolved. plans for 2019 were not as successful as we had hoped. We learnt lessons from these achievements and missteps alike. Life is what we make of it. What our work brings to others. The real and tangible outcomes we can see behind us But that was before coronavirus emerged. For someone like indicate what lies ahead. me, who loves to create and build, there is nothing worse than seeing decline and destruction. I have experienced Petr Kellner and seen this several times. The pandemic has shown every last one of us how relative the things which we considered essential and constant really are. As a result, we are all now thinking much more about what is truly important in life. Family, children, health, freedom. PPF and I are no exception in this regard. We shall not forget where we came from and what we have been through. This is why the photos in this year’s Annual Report are inspired by the places and values that shaped us the most in our youth. Sometimes I ask myself, “Why do I work so much? Why don’t I relax more?” To be honest, first and foremost, I still love what I do. I like thinking about and figuring out how to do things better, differently. I get a thrill from learning and succeeding. I know that there is always more than one path to reach a goal, and I find it rewarding to seek out the best way forward. And then, most importantly, I feel responsibility. Responsibility for others, for my children, for our businesses, and for what we have built at PPF over the course of almost thirty years. I could never have grown PPF alone, without partners, customers, or employees. Success is not an achievement of a single person, but of the cooperation of a team, including family, friends, and the entire Group. I would like to thank them all for this. Foreword 7 8 We are PPF. 9 PPF GROUP 10 PPF Group Annual Report 2019 GROUP PROFILE PPF Group’s growth rests on the PPF operates in Europe, development of traditional and Asia and North America. new industries, the building PPF Group’s assets as at of modern infrastructure, the 31 December 2019 amounted digital economy and linking up to EUR 48.6 billion. PPF Czech talent and capabilities with Group’s corporate ownership global opportunities. PPF Group and management structure is in invests in numerous sectors, the Netherlands. PPF Group N.V., encompassing financial services, headquartered in Amsterdam, telecommunications, biotechno- is the key PPF Group holding logy, real estate and engineering. company where strategic Innovations and advanced decisions governing the entire technologies, in which PPF Group Group’s operations are taken. invests significantly, enable In the Czech Republic, PPF PPF companies to offer highly Group paid CZK 6.9 billion competitive services that not only in taxes and levies in 2019. deliver value to customers, but often also help to drive forward the entire market. In the countries in which it maintains a presence, PPF Group supports science, education, culture and social issues through non-profit projects and its charity work. PPF Group 11 DESCRIPTION OF THE COMPANY PPF GROUP N.V. Date of incorporation 29 December 1994 Registered office Strawinskylaan 933, 1077XX Amsterdam, Netherlands Registration number 33264887 Basic share capital EUR 624,010 Business Holding company for the Group, financing SELECTED FINANCIAL HIGHLIGHTS OF PPF GROUP EUR millions, based on IFRS 2019 2018 2017 Assets 48,614 45,055 38,222 Equity 8,797 7,485 6,907 Revenue 10,149 8,638 6,506 Profit after tax 935 815 642 Segments by equity value¹ Telecommunications 17% PPF Financial Holdings² 40% Real Estate 10% Mechanical Engineering 4% Other 29% ¹ As at 31 December 2019 ² Home Credit, Air Bank, Zonky, PPF banka, ClearBank, Mobi Banka 12 PPF Group Annual Report 2019 SHAREHOLDERS Petr Kellner Jean-Pascal Duvieusart Founder and majority shareholder, PPF Group N.V. Shareholder, PPF Group N.V. (share of voting rights: 98.93%) (share of voting rights: 0.535%) Born in 1964; graduated from the Faculty of Industrial Born in 1966; a graduate of the University of Chicago (MBA) Economics, University of Economics, Prague, in 1986. and the Catholic University of Louvain, Belgium, where He is one of PPF Group’s founders and was chairman of he majored in Commercial Engineering. He joined the the Board of Directors of PPF a.s. from January 1998 to consulting company McKinsey in 1992. He was a managing March 2007. He was a member of the Board of Directors partner at McKinsey Prague between 1999 and 2005, of Assicurazioni Generali from April 2007 to March 2013. when he assumed leadership of McKinsey CIS and Central Petr Kellner oversees the Group’s strategic development Europe. He has advised banks, insurance companies, and its future direction. and industrial companies in Russia, the Czech Republic, Slovakia, Hungary, Poland, and Romania. He has been a PPF Group shareholder since 2010. In January 2020, Ladislav Bartoníček he was appointed as CEO of Home Credit N.V. Shareholder, PPF Group N.V. (share of voting rights: 0.535%) Born in 1964; a graduate of the Faculty of Electrical Engineering, Czech Technical University, Prague. He joined PPF investiční společnost a.s. in 1991 as an executive director. He was awarded an MBA by the Rochester Institute of Technology, New York, in 1993. From 1996 to September 2006, he served as chief executive officer of the insurance company Česká pojišťovna a.s. In 2007, he was appointed CEO and a member of the Board of Directors of Generali PPF Holding N.V. (GPH), one of the largest insurance groups in Central and Eastern Europe, which was established as a joint venture of PPF Group and Assicurazioni Generali. He held his CEO position at GPH until March 2013. From March 2014 to February 2018, he was CEO of SOTIO a.s., PPF Group’s biotechnology company. Since 2018, he has been responsible for telecommunications at the Group. Ladislav Bartoníček has been a shareholder of PPF Group since 2007. PPF Group 13 PETR KELLNER “Life is what we make of it. What our work brings to others. The real and tangible outcomes we can see behind us indicate what lies ahead.” 14 Founder and majority shareholder, PPF Group N.V.15 LADISLAV BARTONÍČEK “The things that you have to work on the most will bring you the greatest satisfaction.” Dolní Poberouní is perhaps the most beautiful piece of countryside near Prague, offering a unique combination of the River Berounka and the Brdy Hills. I have lived here for over 25 years and, as we raised our children here, I think of this place as home. I grew up in Libčice nad Vltavou, a small town where, as children, our expeditions and adventures were fixated on the River Vltava. Rivers – these days the Berounka – continue to fascinate me. Sometimes they adapt to their surroundings; other times they shape them. They are a flowing, ever- changing force. A river is defined moment by moment, each instant determining what the river is to be and prompting what will happen in the next.