Board of Directors of Dufry AG proposes to the upcoming AGM a cash dividend and two new independent board members for election. In addition, the company will launch a share buyback program

Cash dividend and share buyback program

The Board of Directors of Dufry AG proposes to the Ordinary General Meeting a cash dividend of CHF 3.75 per share. The proposed dividend will be paid out of capital contribution reserves. The dividend will not be subject to Swiss withholding tax.

As Dufry has a strong cash flow generation and expects sustainable organic growth, the Board of Directors believes that returning cash to shareholders, including by means of annual dividend payments, should be part of Dufry's capital allocation strategy. For future years, the Board of Directors intends to propose a dividend that is at least equal to the one paid in the previous year, and will target a sustainable return to shareholders of 40% of Dufry's cash net earnings.

In addition, the Board of Directors has decided to launch a share buyback program for the purpose of subsequent cancellation for up to CHF 400 million over a period of up to 12 months. The share buyback is planned as a one-time program.

The Board of Directors view is that the company is currently undervalued and that buying back shares at current price levels represents an efficient way of returning additional capital to shareholders. The shares repurchased will be cancelled and the share buyback will therefore be accretive to earnings per share.

More generally, Dufry will continue to grow organically and make targeted investments at attractive returns through M&A bolt-on acquisitions. Dufry's strong cash flow generation allows it to fund such investments while at the same time reward its shareholders with a sustainable dividend of at least CHF 200 million going forward. Dufry's approach to capital allocation will remain unchanged with the sustainable leverage ratio to remain in the range of 2.0x - 3.0x net debt to EBITDA.

Changes in board composition

The Board of Directors of Dufry AG proposes Lynda Tyler-Cagni and Steven Tadler for election as new independent members of the Board of Directors for a one-year term.

Lynda Tyler-Cagni holds a B.A. (Hons) in Languages, Economics & Politics from the University of Kingston, London. She is the founder and CEO of Tyler Cagni Consulting Ltd, a consulting company advising primarily in the fashion, retail and FMCG sectors. Ms. Tyler-Cagni also serves as a director of Atlantia SpA, an Italian listed global operator in the motorway and airport infrastructure sector. She previously served on the board of World Duty Free Group as a non-executive and independent member and chair of the HR & Remuneration Committee (until the acquisition by Dufry). She was also an advisor to the management board of Bonpoint and held various management positions with Fast Retailing Group and Ermenegildo Zegna.

Steven Tadler holds a BS, with distinction, from the University of Virginia and an MBA from Harvard Business School. He is a Managing Partner and director of Advent International Corp, which he joined in 1985. Mr. Tadler also serves as a director of Bojangles', a restaurant operator and franchisor listed on the NASDAQ, and wTe Corporation. Previous board mandates include Dufry (2010 to 2013), Skillsoft (2010 to 2014) and Transunion (2012 to 2017).

Xavier Bouton and Joaquín Moya-Angeler Cabrera have decided to step down from the Board of Directors at this year's Ordinary General Meeting. Mr. Bouton has been a member of the Board of Directors since 2005 and was a member of the Audit and Remuneration Committees. Mr. Moya-Angeler Cabrera has also been a member of the Board of Directors since 2005 and was Chairman of the Audit Committee and a member of the Nomination Committee.

Juan Carlos Torres Carretero, Chairman of the Board of Directors of Dufry AG, said: "On behalf of my colleagues, I would like to thank Xavier Bouton and Joaquín Moya-Angeler Cabrera for their great dedication and contributions to the development of the Dufry Group. Both have served Dufry with distinction and strongly contributed to the successful development of the company. We wish them all the best for the future. I am delighted to announce the nomination of Lynda Tyler-Cagni and Steven Tadler for election to the Board of Directors. We are convinced that both have the specialist knowledge required to strengthen our Board of Directors and - subject to their election - will provide invaluable skills, experience and expertise."

Spencer Stuart, one of the world's leading global consulting firms, performed a detailed assessment of the Board, its composition, its performance and a comparison with similar publicly traded companies. The results were satisfactory, and in particular the comparison with Dufry's industry peers was very favorable.

Juan Carlos Torres Carretero as Chairman and the other members of the Board of Directors will stand for re-election for a further one-year term.

Subject to their (re-)election, the Remuneration Committee is expected to be chaired by Lynda Tyler-Cagni and to comprise Jorge Born and Claire Chiang, and the Audit Committee is expected to be chaired by Jorge Born and to comprise Heekyung (Jo) Min and Steven Tadler, who are all independent and non-executive members.

Agenda for the Ordinary General Meeting 2018 of Dufry AG

1. Approval of the Consolidated Financial Statements and the Annual Financial Statements for 2017 and Advisory Vote on the Remuneration Report 2017
   1.1 Approval of the Consolidated Financial Statements and the Annual Financial Statements for 2017
   1.2 Advisory Vote on the Remuneration Report 2017
   
2. Appropriation of Available Earnings and Distribution of a Cash Dividend out of Reserves from Capital Contribution
   
3. Discharge of the Board of Directors and the Persons Entrusted with Management
   
4. Re-elections and Elections to the Board of Directors
   4.1 Re-election of the Chairman: Juan Carlos Torres Carretero
   4.2 Re-election of Directors: Andrés Holzer Neumann, Jorge Born, Claire Chiang, Julián Díaz González, George Koutsolioutsos, Heekyung (Jo) Min
   4.3 Election of New Directors: Lynda Tyler-Cagni, Steven Tadler
   
5. Re-election and Elections to the Remuneration Committee: Jorge Born, Claire Chiang, Lynda Tyler-Cagni
   
6. Re-election of the Auditors
   
7. Re-election of the Independent Voting Rights Representative
   
8. Compensation of the Board of Directors and the Global Executive Committee
   8.1 Approval of the Maximum Aggregate Amount of Compensation of the Board of Directors
   8.2 Approval of the Maximum Aggregate Amount of Compensation of the Global Executive Committee

The invitation to the Ordinary General Meeting will be published in the coming days.

The Ordinary General Meeting will be held on May 3, 2018 at 14.00 hrs (doors open at 13.00 hrs) at the VOLKSHAUS BASEL (Festsaal), Rebgasse 12-14, 4058 Basel, Switzerland.

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