ANNUAL REPORT 2019 INDEX ANNUAL REPORT BOARD OF DIRECTORS’ REPORT .................................................................................................... 1 Section One.................................................................................................................................. 2 Chairman’s letter ..................................................................................................................................... 2 Financial highlights .................................................................................................................................. 4 Corporate bodies ..................................................................................................................................... 6 Group chart as at 31 December 2019 ..................................................................................................... 7 Group structure ....................................................................................................................................... 8 The Moncler brand ................................................................................................................................ 10 Values and Purpose ............................................................................................................................... 13 Strategy ................................................................................................................................................. 16 Business model ...................................................................................................................................... 18 Human capital ....................................................................................................................................... 28 Sustainability ......................................................................................................................................... 33 Moncler and the financial markets ....................................................................................................... 35 Section Two ............................................................................................................................... 38 Introduction ........................................................................................................................................... 39 Performance of the Moncler Group ...................................................................................................... 40 Performance of the Parent Company Moncler S.p.A. ........................................................................... 49 Main risks .............................................................................................................................................. 52 Corporate governance ........................................................................................................................... 58 Related-party transactions .................................................................................................................... 60 Atypical and/or unusual transactions ................................................................................................... 60 Treasury shares ..................................................................................................................................... 60 Significant events occurred during the Financial Year 2019 ....................................................................... 61 Significant events occurred after the reporting date ................................................................................. 62 Business outlook.................................................................................................................................... 63 Other information ................................................................................................................................. 64 Motion to approve the financial statements and the allocation of the result for the year ended 31 December 2019 ............................................................................................................................................................... 66 I ANNUAL REPORT AT DECEMBER 31, 2019 - MONCLER CONSOLIDATED FINANCIAL STATEMENTS ................................................................................... 67 CONSOLIDATED FINANCIAL STATEMENTS ............................................................................................ 68 EXPLANATORY NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ........................................... 73 1. General information about the Group .............................................................................................. 73 2. Summary of significant accounting principles used in the preparation of the consolidated financial statements ............................................................................................................................................................... 77 3. Scope for consolidation ..................................................................................................................... 99 4. Comments on the consolidated income statement ........................................................................ 100 5. Comments on the consolidated statement of financial position .................................................... 106 6. Segment information ...................................................................................................................... 122 7. Commitments and guarantees given .............................................................................................. 122 8. Contingent liability .......................................................................................................................... 122 9. Information about financial risks .................................................................................................... 123 10. Other information ......................................................................................................................... 127 11. Significant events after the reporting date ................................................................................... 135 SEPARATE FINANCIAL STATEMENTS ........................................................................................... 137 SEPARATE FINANCIAL STATEMENTS ................................................................................................... 138 EXPLANATORY NOTES TO THE SEPARATE FINANCIAL STATEMENTS .................................................. 143 1. General information ........................................................................................................................ 143 2. Significant accounting principles ..................................................................................................... 145 3. Comments on the income statement ............................................................................................. 162 4. Comments on the statement of financial position.......................................................................... 165 5. Commitments and guarantees given .............................................................................................. 177 6. Contingent liability .......................................................................................................................... 177 7. Information about financial risks .................................................................................................... 177 8. Other information ........................................................................................................................... 179 9. Significant events after the reporting date ..................................................................................... 186 10. Motion to approve the financial statements and the allocation of the result for the year ended 31 December 2019 ....... 186 MONCLER – ANNUAL REPORT AT DECEMBER 31, 2019 II ATTESTATION OF THE CONSOLIDATED FINANCIAL STATEMENTS PURSUANT TO ART. 154 BIS OF LEGISLATIVE DECREE 58/98 INDEPENDENT AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS ATTESTATION OF THE SEPARATE FINANCIAL STATEMENTS PURSUANT TO ART. 154 BIS OF LEGISLATIVE DECREE 58/98 INDEPENDENT AUDITORS’ REPORT ON THE SEPARATE FINANCIAL STATEMENTS REPORT OF THE BOARD OF STATUTORY AUDITOR III ANNUAL REPORT AT DECEMBER 31, 2019 - MONCLER BOARD OF DIRECTORS’ REPORT MONCLER – BOARD OF DIRECTORS’ REPORT AT 31 DECEMBER 2019 1 BOARD OF DIRECTORS’ REPORT Dear Shareholders, 2019 was another extraordinary year for Moncler. We have seen further growth on all economic and financial indicators. Revenues showed an increase of +15% topping the 1.6 billion euros mark, our operating margin was 475 million euros accounting for 29% of revenues, while net cash reached 663 million euros. During these 12 months, although external factors have influenced performance in some important markets, we have become stronger, more structured and increasingly responsive, constantly maintaining the energy, curiosity and genius of a company that still has a very long way to go and many new paths to take. 2019 was also an important year because we decided to take some time to really think about who we are, what we believe in and where we want to go, reflecting on our corporate values and on our purpose, which is the ultimate reason we exist. By