LIVEPOL EL PUERTO DE LIVERPOOL, S.A.B. DE C.V. REPORT ON 2018 FOURTH QUARTER RESULTS Highlights Tailwinds During the year, remittances showed record growth. Compared to the same period in the prior year, growth for the fourth quarter was 13.9%, for an accumulated 10.4%. In January 2019, the consumer confidence index reached its highest level since August 2001. At the December 2018 close, it showed a 23.5% improvement over the December 2017 reading. Exchange rate: the average for the quarter showed 4.5% devaluation with respect to the same period the prior year; however, on a cumulative basis, depreciation was only 1.7% with respect to 2017, nearly leveling at the year end. Headwinds: Inflation was 4.83% at the year-end, 2 p.p. below the figure for the prior year, although above Banxico’s (Mexico's Central Bank) target level. Consumer credit: As a result of the increase in interest rates, consumer credit has been affected throughout the year. The increase with respect to the prior year, mainly in November and December, was only 1.5%. Benchmark interest rate: During the quarter, Banxico raised the benchmark rate by 25 bps twice, and was 8.25% by the year end. Unemployment in December reached its highest level in two years. Company highlights: For Liverpool, same-store sales grew 6.4% during the quarter and 6.5% year-to-date. For Suburbia, growth in same-store sales is 6.6% for the quarter and 10.6% on a cumulative basis. Total income for the quarter grew 8.6% and 10.9% on a cumulative basis. EBITDA margin totaled 19.2%, 38 bps with respect to the prior year. EBITDA margin totaled 14.9% cumulatively, remaining unchanged with respect to the prior year. At the quarter end, the past-due portfolio is 4.5%, remaining unchanged with respect to the prior year. Net profit increased by 7.8% in the quarter, rising 18.4% cumulatively. In 2018, we opened five Liverpool stores, putting the total at 136 stores. We also opened seven Suburbia stores, for an overall 131 stores of this brand throughout the country. 1 LIVEPOL Key Figures Following are the main indicators of the statement of income at the fourth quarter close: Thousand Pesos QUARTER YTD 4Q18 4Q17 Dif % 2018 2017 Dif% Total revenue: 48,394,633 44,546,281 8.6% 135,534,751 122,168,279 10.9% Commercial (includes services and other) 44,026,130 40,745,959 8.1% 120,276,234 108,583,138 10.8% Interest 3,439,555 3,029,091 13.6% 11,786,071 10,480,928 12.5% Leasing 928,948 771,231 20.5% 3,472,446 3,104,213 11.9% Cost of sales 29,644,597 27,247,426 8.8% 81,620,873 73,387,487 11.2% Gross income 18,750,036 17,298,855 8.4% 53,913,878 48,780,792 10.5% Gross margin 38.7% 38.8% -0.09 39.8% 39.9% -0.15 Operating expenses without depreciation 9,460,003 8,915,956 6.1% 33,677,236 30,430,318 10.7% Depreciation 880,286 812,690 8.3% 3,311,274 3,118,791 6.2% Total Operating Expenses 10,340,289 9,728,646 6.3% 36,988,510 33,549,109 10.3% 21.4% 21.8% -0.47 27.3% 27.5% -0.17 Operating income 8,409,747 7,570,209 11.1% 16,925,368 15,231,683 11.1% Operating Margin 17.4% 17.0% 0.38 12.5% 12.5% 0.02 Net income 6,076,261 5,635,796 7.8% 11,704,347 9,885,690 18.4% EBITDA 9,290,033 8,382,899 10.8% 20,236,642 18,350,474 10.3% EBITDA margin 19.2% 18.8% 0.38 14.9% 15.0% -0.09 Customer's portfolio 36,877,576 35,058,849 5.2% Same-store growth Liverpool 6.4% 6.8% -0.4 p.p. 6.5% 5.8% 0.7 p.p. Same-store growth Suburbia 6.6% 7.3% -0.7 p.p. 10.6% 4.6% 6.0 p.p. Same-store growth Total 6.5% 6.9% 7.1% N/A RESULTS Sales of goods and services This quarter, total commercial revenue grew 8.1%; 10.8% cumulatively. Thousand Pesos QUARTER YTD Commercial Revenues 4Q18 4Q17 Dif % 2018 2017 Dif% Liverpool 37,614,051 34,779,374 8.2% 103,436,638 96,056,469 7.7% Suburbia 6,412,079 5,966,585 7.5% 16,839,596 12,526,669 34.4% Total 44,026,130 40,745,959 8.1% 120,276,234 108,583,138 10.8% As for the calendar effect, October had one less Sunday in 2018. Fábricas de Francia's Venta Nocturna de Aniversario took place in early October. 2 LIVEPOL Liverpool During the quarter, same-store sales grew 6.4%, for a total 6.5% cumulatively. Liverpool’s year-to-date average ticket grew 4.6%, and traffic increased 1.8%. In terms of product category, Men, Cosmetics and Hard Lines showed above-average performance; while Children and Ladies were less dynamic. Geographically, the country's North Zone is notable for its expansion, whereas the Southeast and Central zones show slightly below-average growth. Suburbia Same-store sales increased 6.6% in the quarter and 10.6% during the year. Although all divisions are close to the average, General Goods, Children and Underwear showed outstanding growth. Same-store sales growth 2015 2016 2017 2018 2018 18.0% Annual Annual Annual Annual 17.1% Total Liverpool Liverpool Liverpool Liverpool 16.0% 9.8% 7.6% 5.8% 6.5% 7.1% 14.0% 2017 2018 Annual: Annual: 11.5% Suburbia Suburbia 12.0% 11.4% 11.5% 4.6% 10.6% 10.3% 9.5% 10.0% 8.7% 8.6% 7.7% 6.6% 8.0% 7.5% 7.3% 7.4% 6.8% 6.4% 5.8% 6.1% 6.3% 6.0% 5.1% 5.9% 4.1% 4.7% 4.0% 3.2% 2.0% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 Liverpool Suburbia ANTAD Departamental Stores Figures published by the ANTAD (Spanish acronym for the National Association of Supermarkets and Department stores) at December 31, 2018 showed a 4.4% increase, in nominal terms, in same-store sales, and a 5.0% increase cumulatively. As for department stores associated to ANTAD, same-store sales increased 7.8% during the fourth quarter, and 6.8% year-to-date. It should be mentioned that the Coapa Suburbia store remains closed and is therefore not included in the calculation of same-store sales, as is the Coapa Liverpool store, as it only re- opened on October 31, 2018. 3 LIVEPOL Omnichannel business Cumulative growth of the sales program through e-commerce channels reached 40.5%. Click & Collect is now the most popular choice for 54% of customers. Moreover, sales through mobile devices continue to grow. Cumulatively, sales of the Omnichannel business represent 4.8% of Liverpool overall sales. It should be mentioned that Marketplace was launched during the quarter, starting with the Sports and baby products categories. Suburbia.com On October 2, we launched the new Suburbia.com web page, which carries both apparel and general goods. This web page offers two delivery options: home delivery (shipping fee charged to the customer) or Click & Collect. Once the purchase has been made, the latest technology is used to follow up on the delivery, which is handled by a third party. Other services offered include insurance, processing and managing new Suburbia credit cards and guidelines on style and the latest trends. As part of our strategic plan, the new platform complements the Omnichannel experience for this chain's customers with state-of-the-art technology, a new design and easy navigation. Financial Business - Interest and Customer Portfolio In this quarter, revenue in the credit division grew 13.6% with respect to the same period the prior year, 12.5% growth cumulatively. The customer portfolio showed a 5.2% year-to-year increase. The cumulative share of Liverpool credit cards was 45.4% of total sales, for a 49 bps decrease from the prior year. Accounts overdue by more than 90 days account for 4.5% of the overall portfolio, reaching the same level as that at the 2017 year-end close. The rate of growth against last year in the delinquency rate is the lowest in the last ten quarters. The measures taken since last year in terms of new account origination, as well as improvements in the behavior and collection patterns to handle the portfolio, have paid off with better past-due portfolio levels. In December, the Suburbia card totaled 245 thousand accounts and a $600 million pesos portfolio, reaching 6.3% share in sales. 4 LIVEPOL Non-performing loans by more than 90 days (%) and growth rate vs. the prior year NPL % Change vs YA % 5.7% 5.8% 5.8% 5.6% 33.0% 28.0% 5.3% 5.1% 4.9% 5.0% 23.0% 4.8% 4.8% 18.0% 4.5% 4.5% 4.4% 4.4% 4.5% 4.3% 13.0% 4.3% 4.1% 4.0% 8.0% 3.7% 3.8% 3.0% -2.0% 3.3% -7.0% 2.8% -12.0% As of 2018, NIIF 9 replaces International Accounting Rules (NIC) 39. The simplified method was adopted in a way to assess expected credit losses over credit duration.