Pargesa : 1st half of 2019 consolidated results (unaudited)

PRESS RELEASE

Geneva, 31 July 2019

Results at 30 June 2019

Key financial data

• Variation between June 2019 and June 2018 for the consolidated net result and between June 2019 and December 2018 for net debt, net asset value and market capitalization.
• Pargesa's net debt (including 50% of GBL's net debt, the net debt amounts to CHF 363 million at end of June 2019 against CHF 566 million at end of December 2018 - see table at Point 4. Net asset value).
• The Loan To Value ratio is calculated on the basis of (i) Pargesa's direct net debt relative to (ii) Pargesa's portfolio value.

Pargesa's consolidated net result (Group share) stands in increase at CHF 225 million in H1 2019. The increase in the contribution from non-consolidated shareholdings, from private equity and other investment funds as well as the decrease from net financial expenses more than offset the decrease from Imerys' and Parques Reunidos' contribution.

During the first half of 2019, GBL took advantage of favourable market conditions to sell 0.6% of Total's capital, through forward sales, and also 1% of adidas' capital. The sale of Total shares will generate, for GBL, a capital gain of EUR 411 million and the one related to adidas amounts to EUR 333 million. The sale of Total shares completes the Group's withdrawal from the energy sector. These two capital gains totalling EUR 744 million (GBL's share) are recorded directly in equity (adidas in 2019 and Total in 2020, at maturity of the forward contracts) in compliance with IFRS 9, and therefore without any impact on consolidated net result.

Pargesa's net financial debt significantly decreased and amounts to CHF 114 million at 30 June 2019 against CHF 175 million at 31 December 2018.

Since the beginning of the year, Pargesa's net asset value rose 14.7% to CHF 10.3 billion at the end of June 2019.

In summary, the economic result is analysed as follows:

Operating income: CHF 245.7 million in H1 2019 compared with CHF 218.2 million in H1 2018. Economic operating income in H1 2019 includes a contribution from the portfolio amounting to CHF 251.8 million, compared with CHF 266.8 million in H1 2018, reflecting:

• The operating contribution from Imerys for CHF 50.0 million in H1 2019 compared with CHF 67.5 million in H1 2018;
• The increase in the dividends from non-consolidated shareholdings for CHF 203.2 million compared with CHF 172.5 million in H1 2018. The change is primarily due to the increase in the dividends per share paid by some of the portfolio companies, the monetization of LafargeHolcim's dividend in shares, additional investments made by GBL in Umicore and GEA, reimbursements notified by the French tax authorities of withholding taxes on dividends as well as to the decrease in the EUR/CHF exchange rate;
• A contribution in H1 2019 of CHF 20.8 million from private equity and other funds activities, compared with CHF 11.6 million in H1 2018;
• A contribution in H1 2019 of CHF -4.8 million from net financial income and expenses, compared with CHF -13.1 million in H1 2018.

Non-operatingincome (loss): CHF -20.4 million in H1 2019, compared with CHF -5.6 million in H1 2018.

As previously stated, GBL sold 1% of adidas' capital, generating a gain of EUR 333 million (Pargesa's share: CHF 193 million). As per IFRS 9, this gain is recorded directly in shareholders' equity, and did not flow through income statement. The same will apply to the disposal of 0.6% of Total's capital through forward sales, which will generate a capital gain for GBL of EUR 411 million (estimated at CHF 323 million in Pargesa's share, including a foreign exchange result at Pargesa's level) and will be recorded directly in equity at maturity of the forward sale, i.e. in 2020.

As a result of the above, Pargesa's net income(Group share) stands at CHF 225.3 million in H1 2019, compared with CHF 212.6 million in H1 2018.

1. Group structure

The organisation chart below reflects the Group structure at 30 June 2019 a.:

50.0% b.

Sienna

Capital c.

EUR 1'436 e.

EUR 17'126 d.

1. The chart shows the main shareholdings of the portfolio. Shareholdings are expressed as a percentage of the capital held.
2. 51.5% of voting rights (and of economic interest), taking into account the suspended voting rights related to GBL treasury shares.
3. Comprising significant investments in private equity, debt or specific thematic funds.
4. Market value in EUR millions of the main investments held by GBL at 30 June 2019.
5. Estimated value in EUR millions at 30 June 2019.

2. 2019 highlights

• In a favourable market context, GBL finalized, in March and April 2019, its exit from the energy sector initiated in 2013, by selling 0.6% of Total's capital through forward sales maturing in January 2020. Sales were executed at an
  average spot price of EUR 50.52 per share and at an average forward price of EUR 48.37 per share. They have been prepaid1 on 2 May 2019 for a total amount of EUR 771 million. The capital gain generated by these sales will amount to EUR 411 million at GBL's level and will not impact the consolidated net income in 2020, in accordance with IFRS 9. At maturity of these sales, on 24 January 2020, GBL's ownership in Total will be reduced to 0.01%. GBL continues to receive dividends on the disposed shares until this date.
• GBL has also seized this market window to monetize 1% of adidas' capital for a net amount of EUR 499 million and generate a capital gain of EUR 333 million which does not impact the income statement under the accounting standard IFRS 9. At the end of June 2019, the participation in adidas, being 6.8% of the capital, was valued at EUR 3'702 million.
• During the first half of 2019, GBL continued to strengthen its position in Umicore. At 30 June 2019, GBL holds a 18.0% stake in Umicore (17.7% at the end of 2018), representing a market value of EUR 1'250 million.

● Pursuant to GBL's share buyback program, as announced on 31 October 2018, 2.1 million shares for an amount of EUR 181 million have been bought during H1 2019. The economic interest of Pargesa in GBL stands at 51.5% following these purchases at 30 June 2019 against 50.8% at 31 December 2018. This share buyback program is executed up to 83% to date.

1 The prepayment of the forward sales of Total shares will not impact GBL's net financial position until their maturity in January 2020.

• The voluntary takeover bid paid in cash for the shares of Parques Reunidos, announced in April and having begun on 26 July 2019, fits into GBL's objective to increase its exposure to private assets. Conducted alongside EQT AB, a leading player in the private equity sector, and Corporación Financiera Alba, another reference shareholder of the company, this transaction will enable to accelerate the implementation of the value creation strategy within the Parques Reunidos group, focused on optimising existing parks and increasing the portfolio diversification, notably through acquisitions. The result of this offer is expected before the end of 2019.
• GBL announced on 9 July 2019 that is has entered into exclusive negotiations to acquire the Webhelp group, a global leader in the field of customer experience and business process outsourcing. The group has doubled in size since 2015 and aims to achieve a turnover of EUR 1.5 billion in 2019. Upon completion of this transaction, GBL would take a majority shareholding alongside Webhelp's co-founding shareholders and management team. GBL's ambition is to continue, alongside them, to develop the group further and to support its transition from a European player to a global leader. Depending notably on the level of reinvestment of the co-founders and the management team, which is a key factor in the group's successful development, GBL's initial investment in Webhelp should represent 3 to 5% of GBL's net asset value. It is expected that the signing of the legal documentation occurs
  beginning of August 2019, for completion, after obtaining appropriate regulatory authorizations, within the course of the 4th quarter of 2019.
• At the level of Sienna Capital:
  In December 2017, Ergon Capital Partners launched a new fund, Ergon Capital Partners IV, which successfully closed at the end of March 2019, with total commitments of EUR 580 million, beyond the fundraising objective of EUR 500 million. In 2017, Sienna Capital committed EUR 200 million in this new fund.
  On 16 July 2019, Sienna Capital invested EUR 150 million in Marcho Partners LLP, a London-based fund specializing in innovation and technology.

At 30 June 2019, GBL's commitments (amount not called) with respect to Sienna Capital amounted to EUR 468 million (EUR 528 million at 31 December 2018). Sienna Capital's estimated value amounted to EUR 1'436 million at 30 June 2019.

3. Consolidated financial results at 30 June 2019 (unaudited)

The board of Pargesa Holding SA met today and reviewed the unaudited consolidated financial results for the six-month period ended 30 June 2019.

The IFRS consolidated financial statements for H1 2019, established in accordance with the accounting standard IAS 34 - Interim Financial Reporting - will be included in the 2019 interim report, which will be available on Pargesa's website during August. These financial statements underwent a limited review by Deloitte, the Company's auditor.

3.1. Presentation of results in accordance with IFRS

The simplified income statement in accordance with IFRS is as follows:

The operating profit (loss) amounts to a CHF 154.0 million compared with CHF 260.0 million in H1 2018. This change reflects the decrease of Imerys' operating profit, which includes especially restructuring costs of CHF 59 million, related to the implementation of Imerys' group transformation program "Connect & Shape", aiming to step-up its organic growth and improve its operating profitability in the medium term.

The dividends and interest from long-terminvestments item of CHF 395.2 million in H1 2019 against CHF 336.9 million in H1 2018 comprises the net dividends recorded by the Group from its non-consolidated investments. The variation is primarily due to the increase in the dividends per share paid by some of the portfolio companies, the monetization of LafargeHolcim's dividend in shares, additional investments made by GBL in Umicore and GEA and reimbursements notified by the French tax authorities of withholding taxes which had been applied to ENGIE dividends received between 2013 and 2015. These different elements more than compensate the decrease in the EUR/CHF exchange rate.

The other financial income and expenses of CHF -8.5 million in H1 2019 compared with CHF -53.8 million in H1 2018 reflects especially the decrease in interest expenses and the positive variation of the fair value of private equity and other non-consolidated funds.

The net profit from discontinued operations of CHF 38.1 million in 2018 represents the contribution from Imerys' Roofing division, which was sold in October 2018.

The presentation of the economic result that follows makes it possible to assess differently the formation of the Group results.

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