The Board also proceeded to ascertain the independence requirements established by the combined provisions of articles 147-ter, paragraph 4, and 148, paragraph 3, of the TUF and Article 2 of the Corporate Governance Code for the directors Ines Mazzilli, Cinzia Morelli-Verhoog, Irene Boni e Matthieu Brisset.

The Board of Directors finally appointed the members of Control and Risk Committee, the Sustainability Committee, the Remuneration and Nomination Committee and the Transactions with Related Parties Committee.

In particular:

• Ines Mazzilli, Matthieu Brisset and Melchert F. Groot, all non-executive and the first two also independent, were appointed as members of the Control and Risk Committee;

• the directors Eugenio Razelli, Angelo Trocchia and Katia Buja, and the managers of the Group Vladimiro Baldin, Fabio Roppoli and Marco Cella were appointed as members of the Sustainability Committee;

• Cinzia Morelli-Verhoog, Irene Boni and Jeffrey A. Cole, all non-executive and the first two also independent, were appointed as members of the Remuneration and Nomination Committee;

• Ines Mazzilli, Cinzia Morelli-Verhoog and Matthieu Brisset, all non-executive and independent, were appointed as members of the Transactions with Related Parties Committee.

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux and Seventh Street. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2020, Safilo Group recorded net revenues for Euro 780.3 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

The Ordinary Shareholders’ Meeting has also:

1. approved the first section of the Report on the remuneration policy and on the remuneration paid, relating to the Company's policy on the remuneration of the members of the Board of Directors, managers with strategic responsibilities and the Board of Statutory Auditors for the 2021 financial year and the procedures used for the adoption and implementation of this policy, and favourably resolved upon the second section of the Report on the remuneration policy and on the remuneration paid, relating to the items that make up the remuneration of the members of the Board of Directors, managers with strategic responsibilities and the Board of Statutory Auditors, as well as the remuneration paid to them for any reason during the 2020 financial year;

1. in relation to the appointment of the new Board of Directors, which will hold office until the approval of the financial statements at 31^st December 2023, resolved to increase its composition from 9 to 10 members and appointed the related members based on the lists of candidates presented by the shareholders. In particular:

• from the list obtaining the majority of the votes, presented by the shareholder Multibrands Italy B.V. (company controlled by HAL Holding N.V.), holder of a total of 137,417,972 ordinary shares of the Company, equal to 49.84% of the share capital, Eugenio Razelli, Angelo Trocchia, Melchert F. Groot, Jeffrey A. Cole, Robert Polet, Ines Mazzilli, Cinzia Morelli-Verhoog, Katia Buja and Irene Boni were elected.

This list collected 138,767,972 votes, equal to 66.76% of the Company’s share capital present at the Shareholders’ Meeting;

• from the second list by number of votes, presented by BDL Capital Management (manager of the funds BDL Rempart Europe, BDL Convictions, BDL Navarre and RMM LUX BDL European Equity Alpha), holder of a total of 41,344,726 ordinary shares of the Company, equal to 14.99% of the share capital, Matthieu Brisset was elected.

This list collected 69,103,888 votes, equal to 33.24% of the Company’s share capital present at the Shareholders’ Meeting.

In accordance with article 14 of the Company Articles of Association, the position of Chairman of the Board of Directors is to be held by Eugenio Razelli, first candidate of the majority list.

The Board of Directors thanks Guido Guzzetti for his important contribution during his mandate as member of the Board of Directors.

Among the elected members, Ines Mazzilli, Cinzia Morelli-Verhoog, Irene Boni and Matthieu Brisset have stated that they hold the requirements of independence in accordance with the provisions of Articles 147- ter, paragraph 4, and 148, paragraph 3, of T.U.F. (Italy’s Financial Markets Consolidation Act) and in accordance with Article 2 of the Corporate Governance Code.

Finally, as of today and according to the information available to the Company, the Board members Angelo Trocchia, Katia Buja and Jeffrey A. Cole own respectively 314,000, 22,000 and 11,050 ordinary shares of Safilo Group S.p.A.

All the documentation relating to the Shareholders’ meeting, including the CVs of the members of the Board of Directors, is available on the company’s internet website at http://investors-en.safilogroup.com/investor-relations , section Corporate Governance/ Shareholders’ meeting.

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux and Seventh Street. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2020, Safilo Group recorded net revenues for Euro 780.3 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

The agreement provides the following social measures:

• higher severances

• higher holiday bonus (Regres za letni dopust)

• additional pay out for employees under agreed social criteria

• jubilee awards for employees who would otherwise not receive them, but would be entitled to them if still employed on 31.12.2021

• Safilo’s waiver of its claims under the decision of the Higher Labour and Social Court towards disabled employees

“This agreement is part of our broader strategy aimed at ensuring a solid and sustainable future for the Group,” comments Angelo Trocchia, CEO of Safilo Group. “I would like to thank the trade unions who have worked with us in a constructive way to reach an agreement aimed at minimizing the social impact of this difficult decision and the Slovenian Institutions with which we have established a transparent and fruitful dialogue.”

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux and Seventh Street. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2020, Safilo Group recorded net revenues for Euro 780.3 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

Barabino&Partners S.p.A.

Pietro Cavallera

p.cavallera@barabino.it

Ph. +39 02 72023535

Mob. +39 338 9350534

2020 FINANCIAL RESULTS

In a year heavily impacted by the Covid-19 pandemic, Safilo remained focused on the implementation of its Group Business plan:

After H1 business setback, Safilo’s sales and profits grew in the second semester underpinned by the rebound of its wholesale ² activities in the United States and China

Online business more than tripled in 2020 following the acquisitions of Blenders Eyewear and Privé Revaux, the strong progress in Smith and with internet pure players

Medium-term overhead savings Plan almost completed, supporting earnings recovery

Economic and Financial highlights:

Q4 2020:

• Net Sales €225.6M vs €230.4M in Q4 2019, +3.0% at constant/-2.1% at current forex

• Adjusted³ EBITDA €15.0M vs €11.1M in Q4 2019, +34.5%

H2 2020:

• Net Sales €444.7M vs €443.1M in H2 2019, +4.5% at constant/+0.4% at current forex

• Adjusted³ EBITDA €29.3M vs €24.2M in H2 2019, +21.0%

FULL YEAR 2020:

• Net Sales €780.3M vs €939.0M in 2019, -15.2% at constant/-16.9% at current forex

• Adjusted³ EBITDA €1.0M vs €65.4M in 2019, -98.4%

• Adjusted³ Net result € -46.5M vs € -6.0M in 2019

• Group Net debt €222.1M, of which €111.8M for acquisitions, vs €74.8M in 2019

Padua, March 11 2021 – The Board of Directors of Safilo Group S.p.A. has today approved the Company’s consolidated financial statements for the year ended December 31, 2020¹ and examined the separate financial statements for the year ended December 31, 2020¹, which will be submitted for approval by the shareholders at the Annual General Meeting to be held in a single call on April 29, 2021.

The Board of Directors has decided not to propose the payment of a dividend to the next Annual General Meeting.

Angelo Trocchia, Safilo Chief Executive Officer, commented:

“ 2020 presented the most challenging market conditions we have ever experienced and I want to express my utmost gratitude to all our people, in the plants and in our offices around the world, for their dedication and the excellent job accomplished in such a difficult period of our lives.

The health and safety of our people, including the opportunity to manage professional and personal needs with the greatest flexibility, were and continue to be our first priority.

I am proud of the work done by our organization to advance our medium-term strategic agenda, and considering the unprecedented market conditions, I am satisfied with our ability to contain, as much as possible, the impact to our top and bottom line.

In 2020 our net sales fell by 15.2% at constant exchange rates and the adjusted ³ EBITDA finished slightly positive, reflecting the significant Covid-19 impact suffered in the first half of the year followed by a solid sales recovery in the second half, and our decisive interventions on the cost structure. In 2020, we were able to deliver 15 million euros of structural overhead savings, already bringing home the majority of the 20 million targeted in our medium-term Plan, coupled with an effective use of the supports made available by governments throughout this pandemic.

We also worked strenuously to maintain a sound financial profile, securing additional liquidity for the Group with a new guaranteed term loan facility, and handling, to the best of our abilities, our net working capital requirements through a prudent reduction of our inventories and an effective and balanced management of our cash collection and payments activities.

I want to thank our partners, clients and suppliers, for their support, as together we continued building a more sustainable business in such a crucial year.

Q4 reflected again a more challenging marketplace, as fresh restrictions were imposed above all in Europe to contain the second wave of the pandemic. In such a still complex environment, we are therefore particularly pleased with our positive finish to the year, which we think confirms the strategic directions we set out at the end of 2019 and the business priorities we gave ourselves to accomplish our Plan.

In the last three months of the year, our net sales grew by +3.0% at constant exchange rates behind the sequential improvement, quarter on quarter, of our wholesale ² activities, thanks again to the strength of our North American market, where we kept leveraging on the capabilities we built to better serve our customers in the independent opticians channel. In Q4, the United States were thus a key growth driver, which together with the strong business rebound we experienced in China and Australia, allowed us to almost fully offset the impact of the challenging market environment in Europe and in a number of emerging countries.

In a year in which e-commerce and social digital marketing leapfrogged in consumer relevance, the significant progress of Smith’s direct-to-consumer business and the acquisitions of Privé Revaux in February and of Blenders Eyewear in June, gave a strong boost to the digital transformation strategy we announced in December 2019, representing a meaningful support to the recovery we posted in the second half of the year. Our H2 net sales grew by 4.5% at constant exchange rates and the adjusted ³ Ebitda increased by 21%.

Our total online business grew sharply in 2020, contributing around 100 million euros or 13% to our Group’s net sales, from around 4% in 2019, a clear strategic choice we took before the outset of the pandemic and which we invested in during the year, alongside the significant focus we put on strengthening the partnership with our clients through a brand new B2B platform and CRM system, all improving the customer engagement and enhancing our product offer and service levels.

In 2020, we continued to renew our portfolio, launching four new brands during the year, Levi’s, David Beckham, Missoni and Ports, and getting ready for the launch of Isabel Marant and Under Armour at the beginning of 2021.

Last year, we also started our production footprint overhaul, to realign the Group's manufacturing capacity to the current and future production needs, selling the Martignacco site at the beginning of October and starting the reorganization of the Longarone plant.

Considering the challenging market scenarios due to the pandemic we are still dealing with, we are now required to take further steps in the direction of our Plan to have a more efficient and competitive industrial footprint, in particular with reference to the declared intention to start a process for the closure of the Slovenia factory in Ormoz. This is for us a very painful choice, dictated by an already complex situation, which has become structural and no longer sustainable, and on which we will be fully committed to identifying, in collaboration with the local trade unions and authorities, all possible solutions to mitigate its social impacts.

The business environment at the beginning of 2021 remained affected by the containment actions still in place in many countries to halt the spread of Covid-19 and the uncertainties over the scale and timing of the expected rebound in consumer demand across the different geographies. Our business activity in January and February was in line with our expectations for a more moderate start to the year compared to the very positive sales trends recorded at the beginning of 2020, while the first ten days of March confirm a significant acceleration compared to the same period last year, the first to be highly impacted by the consequences of the pandemic.

Sales performance in these months continued to be influenced by the positive business trends in the United States, the ongoing strength of the online channel and a more marked recovery in emerging markets, while a number of countries in Europe and the travel retail business in Asia remain weak spots.

As we continue to maintain a prudent stance on the prospects for the current year awaiting further market evidence of a solid sun season, the main assumption of our work today rests on the opportunity for our business, both owned and licensed, to effectively compensate for discontinued and exiting activities, and on the continuation of our cost reduction plan to recover this year a more positive economic profile.”

NET SALES PERFORMANCE IN Q4 2020

In the fourth quarter of 2020 , Safilo posted total net sales of Euro 225.6 million, up 3.0% at constant exchange rates and down 2.1% at current exchange rates compared to Euro 230.4 million posted in the fourth quarter of 2019.

The positive sales performance reflected the contribution to the Group’s North American business of the recent acquisitions of Privé Revaux and Blenders Eyewear, for a total of Euro 14.1 million, and the sequential improvement of Safilo’s organic business, down 3.6% at constant exchange rates, and almost flat at the wholesale² business level, at -1.6% at constant exchange rates from -33.2% in H1 and -5.5% in Q3 2020.

The progress of Safilo’s total online sales was again very significant in Q4, standing at around 12% of the Group’s net sales from around 4.5% in the same period of 2019, thanks to the fast growing e-com activities of the recent acquisitions and to an organic online sales growth of +60.9% at constant exchange rates, driven by Smith’s D2C channel and by the Group’s sales generated through internet pure players.

The drivers by geography of the Group net sales performance in Q4 2020 were:

• the confirmed rebound of the North American business, up 8.9% on an organic basis excluding the acquisitions and at constant exchange rates. Q4 total net sales in North America were instead up 27.0% at constant exchange rates and 19.2% at current exchange rates, thanks to the contribution, seasonally more moderate than in the previous two quarters, of Privé Revaux and Blenders Eyewear;

• the still weak market environment in Europe, where net sales in Q4 2020 fell by 18.0% at constant exchange rates (-16.0% at the wholesale² business level) and 19.4% at current exchange rates, due to the reintroduction of varying restrictions to people’s mobility and commercial activities following the second wave of coronavirus infections. Lockdowns and lack of tourism affected in particular specialty channels like boutiques and travel retail, whereas sales generated through internet pure players continued to register strong progress. The quarter also showed the recovery in order taking and wholesale activity from big chains;

• the meaningful growth of Asia Pacific, with the quarterly net sales up 28.1% at constant exchange rates and 24.1% at current exchange rates, from -6.4% in Q3 2020, thanks to the strong acceleration recorded by the Chinese business, more than tripled in Q4 2020, and to a significant sales acceleration also in Australia;

• the milder sales contraction in the Rest of the World, down 6.5% at constant exchange rates and -19.7% at current exchange rates, driven by the positive performance in the quarter of Brazil and Mexico and the first signs of a recovery materializing also in the Middle East countries.

NET SALES PERFORMANCE IN FULL YEAR AND IN H2 2020

Safilo closed 2020 with net sales of Euro 780.3 million, down 15.2% at constant exchange rates and 16.9% at current exchange rates compared to Euro 939.0 million recorded in 2019, due to the sharp decline suffered in the first half of the year following the severe lockdowns put in place by governments globally to fight the Covid-19 pandemic.

The business rebound recorded by the Group in the third quarter, followed by the positive net sales performance achieved in the fourth quarter allowed Safilo to post an H2 2020 net sales growth of +4.5% at constant exchange rates, +0.4% at current exchange rates, reaching Euro 444.7 million compared to Euro 443.1 million in the second half of 2019.

In 2020, Safilo’s organic business, excluding the acquisitions, declined by 21.9% at constant exchange rates, -21.5% at the wholesale² business level, while the contribution of the newly acquired Blenders Eyewear and Privé Revaux equalled Euro 61.8 million for the full period of consolidation, with the two businesses together growing by +66% on a pro-forma performance basis⁴, thanks to the surge of their e-com activities.

In 2020, Safilo’s total online sales, including acquisitions, almost tripled compared to 2019, accounting for around 13% of the Group’s total net sales, from around 4% in the previous year.

Group net sales performance by geography in H2 2020:

Group net sales performance by geography in FY 2020:

2020 total sales in North America grew +4.7% at constant exchange rates, after jumping +36.3% in H2 as a result of the full contribution of the acquisitions, and of the organic business rebound of +10.6% at constant exchange rates. The latter positive performance was underpinned by the solid recovery experienced by the Group in the independent optical stores and by the strength of the Smith products in the sports and direct-to-consumer channels.

After a very difficult first half of the year, in 2020 the North American organic business declined less than all other geographies, down 14.2% at constant exchange rates;

2020 sales in Europe were down 25.9% at constant exchange rates, as trading activities remained weak also in the second half of the year, at -17.3%, due to a subdued summer season affecting the sunglass business in Q3 and the second wave of Covid-19 infections undermining the recovery in Q4;

2020 sales in Asia Pacific were down 20.9% at constant exchange rates, with the sales contraction almost entirely explained by the drastic drop of the travel retail business due to the extensive bans on travel in the year. In the second half of 2020, sales performance in Asia Pacific rebounded, up +10.6% at constant exchange rates, thanks to a surging business in China and in Australia;

2020 sales in the Rest of the World were down 32.6% at constant exchange rates, reflecting the very difficult health environment which characterized the IMEA and Latin America countries for the first nine months of the year, with the first signs of a recovery materializing only in the fourth quarter.

ECONOMIC PERFORMANCE IN Q4 2020

Net sales performance in Q4 2020 allowed the Group to continue the recovery of earnings started in the third quarter, registering a positive adjusted³ EBITDA of Euro 15.0 million, up 34.5% compared to the Euro 11.1 million in Q4 2019. In Q4 2020, the adjusted ³ EBITDA margin increased to 6.6% of sales from 4.8% in Q4 2019, a 180 basis-point improvement which mainly reflected the improved operating leverage in the period.

ECONOMIC PERFORMANCE IN FULL YEAR AND IN H2 2020

Safilo’s 2020 economic results finally reflected on one side the unprecedented drop of sales and economic fallout in the first half of the year due to the drastic reduction of worldwide business activities which followed the outbreak and spread of the Covid-19 pandemic, on the other the positive business recovery achieved by the Group in the second half of the year, notwithstanding a market environment which remained in many cases highly constrained.

In the year, Safilo achieved structural overheads costs savings of Euro 15 million, marking a significant progress in relation to the Group’s medium-term plan for a total Euro 20 million overheads cost reduction. The contingency measures in relation to the Covid-19 emergency resulted instead in a one-time saving estimated at Euro 28 million, mainly reflecting applicable personnel relief programs.

Key economic highlights of the Group economic performance in Full Year and H2 2020

2020 gross profit at Euro 362.5 million, down 24.0% compared to Euro 476.9 million in 2019, with the gross margin on sales declining to 46.5% from 50.8% in the previous year.

The industrial performance reflected on one side the significant drop of production volumes incurred in H1 2020, on the other a negative sales mix effect and non-recurring costs for obsolescence and write-offs of fixed assets at the end of year.

Gross profit increased by 1.5% in the second half of 2020 compared to the same period of 2019, with the gross margin improving to 48.1% of sales from 44.3% recorded in the first half of the year and 47.6% registered in the same period of 2019;

2020 adjusted ³ EBITDA at Euro 1.0 million, down 98.4% compared to Euro 65.4 million in 2019.

In the second half of 2020, the Group’s adjusted³ EBITDA increased to Euro 29.3 million, up 21.0% compared to Euro 24.2 million in the second half of 2019, fully recovering the loss of Euro 28.3 million recorded in the first half of 2020.

In the full year, selling, general and administrative expenses, excluding D&A, decreased by 13.3% compared to the prior year as the Group strived to contain the negative impact of the operating deleverage by accelerating the execution actions behind its overheads cost saving program, and utilizing the available contingency measures.

In the second half of 2020, SG&A expenses benefitted from lower royalty and marketing contribution costs, while logistics costs to move products whether by sea, air or land climbed 39.8% (+13.7% in 2020).

2020 adjusted ³ operating result at a loss of Euro 54.3 million compared to the profit of Euro 3.7 million recorded in 2019. In 2020, D&A, excluding non-recurring write-offs of fixed assets, declined by 10.4% compared to the prior year mainly due the effect of the manufacturing downsizing initiated in 2019 in line with the Group’s restructuring plan and the lower organic investments incurred in the year.

In the second half of 2020, the adjusted³ operating result finished slightly positive, at Euro 0.9 million compared to the adjusted ³ operating loss of Euro 9.6 million recorded in H2 2019.

2020 adjusted ³ net result at a loss of Euro 46.5 million compared to the loss of Euro 6.0 million recorded in 2019. Below the operating result, the main drivers were:

• net financial charges increasing to Euro 24.1 million compared to Euro 7.3 million in 2019, mainly due to negative exchange rates differences and a higher average gross debt;

• a positive accounting adjustment equal to Euro 19.8 million as a result of the reduced liability for put&call options on non-controlling interests due to the revision of the financial plans reflecting the impacts of the Covid-19 pandemic;

• a total tax benefit of Euro 14.4 million compared to the income taxes of Euro 22.9 million booked in 2019, mainly as a result of the US CARES Act which provided for the opportunity to carryback net tax losses, with a positive rate differential impact.

In the second half of 2020, the Group’s adjusted³ net result equalled a profit of Euro 17.2 million compared to an adjusted³ net loss of Euro 14.5 million in H2 2019.

KEY CASH FLOW DATA AND FINANCIAL PERFORMANCE

In 2020, Safilo’s Free Cash Flow before the acquisitions/ disinvestments equalled a cash absorption of Euro 31.3 million compared to the negative Free Cash Flow of Euro 21.0 million recorded in 2019.

Safilo closed the year with a slightly positive cash flow from operating activities of Euro 0.9 million, which reflected the Group’s strict control on working capital management, resulting in a cash generation of Euro 42.5 million, sufficient to fully offset the negative economic result of the year. In particular, the key driver of the positive net working capital dynamic was the significant reduction of inventories, which prudentially continued into the second half of the year after the tight control placed by the Group on stock levels in the first, most difficult semester.

Trade receivables, which increased in the third and fourth quarters as a result of the improved sales performance, remained a decreasing item on a full year basis as they also benefitted of a much stronger cash collection activity resumed by the Group in the second half. On the other hand, in the fourth quarter the Group made further progress in the normalization of trade payables.

In 2020, cash flow for organic investments amounted to Euro 21.4 million compared to a capital expenditure of Euro 30.6 million in 2019.

At December 31, 2020, the Group’s net debt stood at Euro 222.1 million (Euro 179.0 million pre-IFRS 16), compared to Euro 74.8 million in 2019 and Euro 201.7 million at the end of September 2020 (respectively Euro 27.8 million and Euro 155.8 million pre-IFRS 16). Excluding the net investment of Euro 111.8 million for the acquisition of Privé Revaux and Blenders Eyewear, the higher net debt position at the end of 2020 reflected the economic performance deterioration suffered in a year heavily impacted by the Covid-19 pandemic.

The key components of the Group’s net debt at the end of December 2020 were the following:

• a long-term debt position of Euro 278.4 million, made of the bank loans for Euro 151.5 million (including the Euro 108 million Term Loan facility guaranteed by SACE), the shareholder loan for Euro 93.5 million and an IFRS-16 effect for Euro 33.5 million;

• a short-term debt position of Euro 32.6 million, made of the bank loans and other short-term borrowings for Euro 23 million and an IFRS-16 effect for Euro 9.6 million;

• a cash position of Euro 89.0 million.

BUSINESS UPDATE IN RELATION TO THE COVID-19 PANDEMIC

Business environment at the beginning of 2021 remained affected by the containment actions still in place in many countries to halt the spread of Covid-19 and the uncertainties over the scale and timing of the expected rebound in consumer demand across the different geographies. Safilo's business activity in January and February were in line with management's expectations for a moderate start to the year compared to the very positive sales trends recorded at the beginning of 2020, while the first days of March support the expectation for a significant business rebound compared to the same month last year. Based on the current visibility on the order book, the Group expects its total net sales for the first quarter of 2021 to grow, at constant exchange rates, in a high-single to low-double digit range compared to Q1 2020.

OTHER RESOLUTIONS BY THE BOARD OF DIRECTORS

Approval of the Consolidated Non-Financial Information (Sustainability Report)

Together with the 2020 Annual Report, the Board of Directors of Safilo Group S.p.A. approved the 2020 Consolidated Non-Financial Information (Sustainability Report), in line with the application of the non-financial reporting obligation under Legislative Decree 254/2016.

Appointment of the Board of Directors for the three-year period 2021-2023

The Board of Directors of Safilo Group S.p.A. also resolved to submit to the Shareholders' Meeting of the Company called on 29 April, inter alia, the appointment of the administrative body for the three-year period 2021-2023. The related notice and related explanatory reports will be duly published in accordance with the terms provided for by law.

Notes to the press release:

¹ The auditing process of the consolidated and separate financial statements is currently under finalization.

² The wholesale business excludes the business of the supply agreement with Kering, reported within the geographical area of Europe.

³ In 2020, the adjusted economic results exclude non-recurring costs for Euro 25.5 million (Euro 21.1 million at the EBITDA level and Euro 22.8 million at the net result level) due to restructuring expenses related to the ongoing cost saving plan for Euro 16.6 million, and to charges due to the termination of activities related to exiting licensed brands, such as write-offs of industrial assets, for Euro 8.9 million.

In Q4 2020, the adjusted EBITDA excludes non-recurring costs for Euro 9.3 million, the corresponding part of the above indicated Euro 21.1 million.

In 2019, the adjusted economic results excluded: (i) the impairment of the entire goodwill allocated to the Group’s cash generating units of Euro 227.1 million, (ii) the write-down of deferred tax assets of Euro 22.4 million, (iii) the write-down of fixed assets of Euro 9.0 million for the restructuring plan in Italy, announced on December 10, 2019, (iv) non-recurring costs of Euro 39.4 million, related to the above-mentioned restructuring plan in Italy for Euro 21 million, to the cost saving program undertaken by the Company during the year, and to activities linked to acquisitions and divestitures. At the net result level, there was a negative tax effect on the non-recurring costs themselves of Euro 1.9 million.

In Q4 2019, the adjusted EBITDA excluded non-recurring costs for Euro 29.0 million, the corresponding part of the above indicated Euro 39.4 million.

⁴ Safilo Group has consolidated Privé Revaux and Blenders Eyewear in 2020, as per the respective acquisition dates of February 10, 2020 and June 1 ^st, 2020. 2020 pro-forma performances are calculated compared to the same period of 2019.

Statement by the manager responsible for the preparation of the company’s financial documents

The manager responsible for the preparation of the company’s financial documents, Mr. Gerd Graehsler, hereby declares, in accordance with paragraph 2 article 154 bis of the “Testo Unico della Finanza”, that the accounting information contained in this press release corresponds to the accounting results, registers and records.

Disclaimer

This document contains forward-looking statements, relating to future events and operating, economic and financial results for Safilo Group. Such forecasts, due to their nature, imply a component of risk and uncertainty due to the fact that they depend on the occurrence of certain future events and developments. The actual results may therefore vary even significantly to those announced in relation to a multitude of factors.

Alternative Performance Indicators

The definitions of the “Alternative Performance Indicators”, not foreseen by the IFRS-EU accounting principles and used in this press release to allow for an improved evaluation of the trend of economic-financial management of the Group, are provided below:

• EBITDA (gross operating profit) is calculated by Safilo by adding to the Operating profit, depreciation and amortization;

• The Net Debt is for Safilo the sum of bank borrowings and short, medium and long-term loans, net of cash in hand and at bank;

• The Free Cash Flow for Safilo is the sum of the cash flow from/(for) operating activities and the cash flow from /(for) investing activities.

Conference Call and Webcast

Today, at 6.30 pm CET (5.30pm GMT; 12.30pm EST) a conference call will be held with the financial community during which Full Year 2020 results will be discussed.

It is possible to follow the conference call by calling +39 02 8020911, +44 1212 818 004, +33 1 70918704 or +1 718 7058796 (for journalists +39 02 8020927).

The conference call is also available via webcast at https://87399.choruscall.eu/links/safilo210311.html .

A recording of the conference call will be available from March 11, until March 13, 2021 on

http://SafiloGroup/FY2020Results/conferencecallReplay .

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux and Seventh Street. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2020, Safilo Group recorded net revenues for Euro 780.3 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

This intervention follows the actions taken in Italy in 2020, which involved the closure of the Martignacco production site and the reorganization of the Longarone site, which is still ongoing.

The already complex situation of the Ormož site in terms of reduction of volumes – due to the termination of the licensing agreements for major brands and the ever-growing trend towards acetate products, a material appreciated by optical customers and consumers for its quality and prestige – has been worsened by the Covid-19 pandemic and has led to structural imbalances which are not sustainable for the years to come.

Furthermore, the above-mentioned closure would be consistent with the Group’s business objectives aimed at optimizing and improving the efficiency of its manufacturing footprint.

The Group confirms the opening of a discussion table with the Trade Unions and institutions to identify all possible solutions in order to mitigate any social impacts of this painful scenario.

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux and Seventh Street. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2019, Safilo Group recorded net revenues for Euro 939 million.

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

Barabino&Partners S.p.A.

Pietro Cavallera

p.cavallera@barabino.it

Ph. +39 02 72023535

Mob. +39 338 9350534

Padua, March 8, 2021 – Safilo, a worldwide leader in the design, manufacturing, and distribution of eyewear, announces the introduction of Eastman Acetate Renew and Eastman Tritan™ Renew in its sunglass and optical products. Both products are part of a broad portfolio of sustainable resins now offered at scale by Eastman, a global specialty materials provider and pioneer in molecular recycling. They enable Safilo to increase the sustainability of its products across its wide brand portfolio.

Safilo will debut Eastman Tritan™ Renew with its proprietary brand Polaroid in January 2022. The two innovative materials will be progressively rolled out across Safilo’s broad brand portfolio, both for sun and for optical frames, further asserting the Company’s business commitment to sustainability and its efforts to bring more recycled materials to the eyewear industry.

“It is so important nowadays to act responsibly and to consider the social and environmental impacts of our business,” – declared Angelo Trocchia, CEO of Safilo Group. “We are committed to leading the way in our approach to our products and packaging without using new resources and without compromising the quality of our frames, thereby continuing to offer the same level of impeccable quality. Our intention is to expand the use of sustainable materials as much as possible in order to progress in our sustainability journey.”

“By using both Eastman Tritan™ Renew and Eastman Acetate Renew, Safilo can provide their consumers and their licensors with a variety of differentiated options that meet their high standards for both design and sustainability” – said Glenn Goldman, Commercial Director, Eastman Specialty Plastics. “We are proud to work with Safilo as they make these bold steps and deliver on their commitment to a more sustainable future.”

Eastman Tritan™ Renew is a high performance copolyester made of 50% certified recycled content*. Crystal clear, durable and BPA-free, it offers sustainability without compromise, ensuring performance and safety. Safilo will be the first eyewear player to introduce this renewable material in its product offer.

Eastman Acetate Renew is composed of 60% bio-based and 40% certified recycled content*. The resulting material is identical in performance to traditional acetate, meaning it can give the same premium “look and feel” to eyewear that wearers expect from traditional acetate.

Produced via Eastman’s innovative Advanced Circular Recycling technologies – carbon renewal technology (CRT) and polyester renewal technology (PRT) – these new products are made from waste plastic and, as such, reduce consumption of fossil resources, and have significantly lower greenhouse gas footprints than traditional eyewear materials.

In 2020, Safilo also introduced ECONYL® regenerated nylon in its eyewear collections, starting with the TOMMY JEANS line, thanks to a pioneering partnership with Aquafil, a well-known global player that produces polymers and synthetic fibers. Also in 2020, Safilo developed the first eyewear style made with ocean waste plastic for The Ocean Cleanup, the recognized Dutch non-profit environmental organization, with injected plastic deriving from the Great Pacific Garbage Patch (GPGP).

*The recycled content is achieved by allocating the recycled waste plastic to Eastman Renew materials using a mass balance process certified by ISCC.

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux and Seventh Street. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2019, Safilo Group recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations
Barbara Ferrante
Ph. +39 049 6985766
http://investors-en.safilogroup.com

Safilo Group Press Office
Elena Todisco
Mob. +39 339 1919562
Anna Cappozzo
Mob. +39 366 9293953

About Eastman

Founded in 1920, Eastman is a global specialty materials company that produces a broad range of products found in items people use every day. With the purpose of enhancing the quality of life in a material way, Eastman works with customers to deliver innovative products and solutions while maintaining a commitment to safety and sustainability. The company\'s innovation-driven growth model takes advantage of world-class technology platforms, deep customer engagement, and differentiated application development to grow its leading positions in attractive end markets such as transportation, building and construction, and consumables.?As a globally inclusive and diverse company, Eastman employs approximately 14,500 people around the world and serves customers in more than 100 countries. The company had 2020 revenues of approximately $8.5 billion and is headquartered in Kingsport, Tennessee, USA. For more information, visit?eastman.com.

Editorial Contact:
Laura Mansfield, APR
The Tombras Group
+1 (865) 599.9968
lmansfield@tombras.com

as a result of the progressive improvement of the wholesale business²

and the ongoing growth of the online channel

H2 sales growth +4.5% brings full year sales

at Euro 780.3 million, -15.2% at constant exchange rates

FY 2020 adjusted³ EBITDA at break-even

Padua, January 27 2021 – The Board of Directors of Safilo Group S.p.A. has today examined the Group’s preliminary¹ net sales for the financial year ended December 31, 2020. The full year annual results will be approved by the Board of Directors on March 11, 2021.

Safilo’s preliminary¹ 2020 net sales equaled Euro 780.3 million, down 15.2% at constant exchange rates and 16.9% at current exchange rates compared to Euro 939.0 million recorded in 2019, due to the sharp decline suffered in the first half of the year following the severe lockdowns put in place by governments on a global scale to fight the Covid-19 pandemic.

In the second semester of 2020, Safilo's net sales instead grew by 4.5% at constant exchange rates, thanks to the business rebound recorded in the third quarter and the sales increase achieved by the Group also in the fourth quarter, notwithstanding the negative impacts of the second pandemic wave.

Q4 2020 net sales in fact amounted to Euro 225.6 million, up 3.0% at constant exchange rates (-2.1% at current exchange rates) compared to Euro 230.4 million recorded in the same quarter of 2019. Meaningfully in the period, the positive sales performance also reflected the progressive improvement of the wholesale business², which in Q4 recorded a more moderate decline, equal to -1.6% at constant exchange rates, from -5.5% in Q3, while the acquisitions of Privé Revaux and Blenders Eyewear added a total of Euro 14.1 million to the Group’s North American business.

PRELIMINARY¹ NET SALES BY GEOGRAPHIC AREA FOR Q4

The main drivers of the Group’s Q4 2020 net sales performance were:

the resilience of the North American wholesale business, up 8.9% on an organic basis excluding the acquisitions and at constant exchange rates. Q4 total sales in North America were instead up 27.0% at constant exchange rates and 19.2% at current exchange rates, thanks to the contribution, seasonally more moderate than in the previous two quarters, of Privé Revaux and Blenders Eyewear;

the still challenging trading conditions in Europe, where net sales declined by 18.0% at constant exchange rates (-16.0% for the wholesale business²) and 19.4% at current exchange rates, due to the reintroduction of varying restrictions to people’s mobility and commercial activities following the second wave of coronavirus infections. Lockdowns and lack of tourism affected in particular specialty channels like boutiques and travel retail, whereas sales generated through internet pure players continued to register strong progress. The quarter also showed the recovery in order taking and wholesale activity from big chains;

a business rebound in Asia Pacific, with the quarterly sales up 28.1% at constant exchange rates and 24.1% at current exchange rates, from -6.4% in Q3 2020, thanks to the strong acceleration recorded by the Chinese business, more than tripled in Q4, and to a significant sales acceleration also in Australia;

improving sales trends in the Rest of the World, down 6.5% at constant exchange rates and 19.7% at current exchange rates, driven by the positive performance in the quarter of Brazil and Mexico and the first signs of a recovery materializing also in the Middle East countries.

Net sales performance in the fourth quarter of 2020 also confirmed the two main trends which emerged during the year with regards to distribution channel and product category.

The progress of Safilo’s online sales was in fact very significant also in Q4, standing at around 12% of the Group’s net sales (from around 4.5% in the same period of 2019), thanks to the contribution of Blenders and Privé Revaux’s e-com activities, and to an organic online sales growth of +60.9% at constant exchange rates, driven by Smith’s D2C channel and by the Group’s sales generated through internet pure players.

In the still highly restrictive business context which characterized the fourth quarter, the demand of consumers and retail activities in the various markets continued to focus on prescription frames, a product category which is a strategic priority for Safilo and where the Group has been making significant progress in terms of product offer, service level, customer engagement and digital connection thanks to its new B2B platform and CRM system.

PRELIMINARY¹ NET SALES BY GEOGRAPHIC AREA FOR THE FULL YEAR

 

Safilo’s preliminary¹ 2020 organic business declined 21.9% at constant exchange rates (-21.5% for the wholesale business²), while the contribution of the acquisitions accounted for Euro 61.8 million for the full period of consolidation. In 2020, Blenders Eyewear and Privé Revaux grew together +66% on a pro-forma performance basis⁴.

In 2020, Safilo’s online sales, including acquisitions, accounted for around 13% of the Group’s total net sales, from around 4% in 2019.

Net sales performance in the fourth quarter allowed the Group to continue the recovery of earnings which began in the third quarter. In value terms, the positive adjusted³ EBITDA achieved by Safilo in the second half of the year is thus expected to fully offset the significant loss suffered in the first half, allowing the Group to return to break-even in the full year.

On a preliminary¹ basis, at the end of December 2020, the Group’s net debt is expected to be around Euro 179 million (pre-IFRS 16), compared to Euro 155.8 million at the end of September 2020.

Notes to the press release:

¹ Preliminary net sales, adjusted EBITDA and Group net debt for 2020 are unaudited.

² The wholesale business excludes the business of the production agreement with Kering, reported within the geographical area of Europe

³ The adjusted EBITDA excludes non-recurring items.

⁴ Safilo Group has consolidated Privé Revaux and Blenders Eyewear in 2020, as per the respective acquisition dates of February 10, 2020 and June 1, 2020. Privé Revaux and Blenders Eyewear pro-forma performance is calculated on their total net sales for 2020 compared to 2019.

About Safilo Group

Established in 1934 in Italy’s Veneto region, Safilo Group is one of the eyewear industry’s principal players in the design, manufacturing and distribution of optical frames, sunglasses, sports eyewear, goggles and helmets. The Group designs and manufactures its collections by blending stylistic, technical and industrial innovation with quality and skillful craftsmanship. With an extensive global presence, Safilo’s business model enables it to monitor its entire production and distribution chain. From research and development in five prestigious design studios, located in Padua, Milan, New York, Hong Kong and Portland, to its six company-owned production facilities and network of qualified manufacturing partners, Safilo Group ensures that every product offers the perfect fit and meets the highest quality standards. Reaching approximately 100,000 selected points of sale worldwide with an extensive wholly owned network of subsidiaries in 40 countries and more than 50 partners in 70 countries, Safilo’s well-established traditional wholesale distribution model, which encompasses eyecare retailers, chains, department stores, specialized retailers, boutiques, duty free shops and sporting goods stores, is complemented by Direct-to-Consumer and Internet pure player sales platforms, in line with the Group’s development strategies.

Safilo Group’s portfolio encompasses own core brands: Blenders, Carrera, Polaroid, Privé Revaux, Safilo, Seventh Street and Smith. Licensed brands include: Banana Republic, BOSS, David Beckham, Elie Saab, Fendi, Fossil, Givenchy, havaianas, HUGO, Isabel Marant, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, PORTS, rag&bone, Rebecca Minkoff, Tommy Hilfiger, Tommy Jeans and Under Armour.

The parent company, Safilo Group S.p.A., is listed on the Italian Stock Exchange (“MTA”) organized and managed by Borsa Italiana (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI). In 2019, Safilo Group recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

• Q3 2020 net sales at Euro 219.1 million, up 6.0% at constant exchange rates;

9M 2020 net sales at Euro 554.7 million, down 21.1% at constant exchange rates;

• Further strong progress of Safilo's online business spurred by the full-quarter contribution of the new brands Blenders Eyewear and Privé Revaux, and Smith's D2C sales;

• Q3 2020 adjusted¹ EBITDA turning positive, up 9.3% to Euro 14.3 million and a margin on sales of 6.5%; 9M 2020 adjusted¹ EBITDA now at Euro -13.9 million;

• Group Net Debt at the end of September well under control, at Euro 201.7 million (post-IFRS 16) compared to Euro 188.5 million at the end of June 2020.

Padua, November 3, 2020 - The Board of Directors of Safilo Group S.p.A. has today reviewed and approved Q3 and the first nine months 2020 economic and financial key performance indicators.

As anticipated by the Group in the press release dated October 1^st, in the third quarter of 2020 Safilo's sales and economic results recorded a significant recovery compared to the severe downturn experienced in the first half of the year following the coronavirus pandemic and the subsequent, extensive lockdown measures.

Q3 2020 net sales reached Euro 219.1 million, growing by 3.0% at current exchange rates and 6.0% at constant exchange rates compared to the same quarter of last year, with the key positive drivers represented by the significant rebound experienced by the wholesale market in North America, and the full-quarter contribution deriving from the recent acquisitions of Blenders Eyewear and Privé Revaux. The latter, together with the continuing progress recorded by Smith's D2C sales and by the Group's business generated through internet pure players, propelled Safilo's total online sales to around 16% of Group total turnover.

In the third quarter, the positive sales development and the ongoing implementation of the Group's cost saving actions and contingency measures allowed Safilo to return to a positive adjusted¹ EBITDA of Euro 14.3 million, up 9.3% compared to the same quarter of 2019.

Angelo Trocchia, Safilo Chief Executive Officer, commented:

"After we were heavily impacted by the Covid-19 outbreak and the consequent global lockdowns between the first and the second quarters of the year, in the third quarter our business had a positive reaction reflecting, on one side, the sales rebound recorded in July as an expected catch-up effect after the strong H1 pandemic impacts, and, on the other side, a dynamic US market continuing into August and September, making North America the main driver of our recovery.

It is also important to note that in the third quarter, all our core markets and channels recorded an improvement compared to the first half of the year, from an outstanding growth in China to more positive results in some of the main European markets such as Italy, Germany and France, while the IMEA countries, Latin America and the travel retail channel remained key hurdles to a full recovery.

As we continue to progress on the strategies set out in our Group Business Plan, seizing the additional opportunities provided by the current market environment, in the third quarter our direct-to-consumer strategy gained additional speed and relevance. This was thanks to the ongoing success of our Smith e-com business, and to the strength of our recent acquisitions, Blenders Eyewear through its advanced e-com platform, and Privé Revaux leveraging on its social marketing skills to expand its reach offline and online.

The work on our digital transformation strategy progressed also with the launch in August of our new B2B platform in Europe and of a new Customer Relationship Management system in November.

These are the first two execution waves of a significant mid-term project which goes in the direction of reshaping and enhancing the relationship, the engagement and the way we do business with our many European opticians, improving after-sales-service and client satisfaction, to ultimately increase the share of our B2B business.

We had two other important objectives to achieve in this still very complex period and we are thus very pleased with their positive outcome. On one side, we secured additional liquidity for the Group with a new term loan facility of Euro 108 million guaranteed by SACE, and, on the other, in line with our industrial plan to optimize the production footprint we sold the Italian plant in Martignacco to a local entrepreneur, an important step not just for us to recover a sustainable economic profile, but also for the workers and the local communities.

The third quarter delivered promising sales growth and the recovery of a satisfactory level of adjusted EBITDA, and while September results were relatively slower than the trends during the summer, business development in October was positive, again mainly driven by the solid performance of the US market and the online business.

There are again significant uncertainties in front of us due to the Covid-19 pandemic and the business environment, as we enter November and the very important holiday season with a new wave of infections emerging in several countries. Once again, therefore, a very complex business context in which our most important priority remains that of preserving the health of all the people who work at our offices and sites, guaranteeing, at the same time, the widest possible use of smart-working.

We therefore continue to maintain a very prudent stance for the remainder of the year, and we remain committed to providing timely updates to all our stakeholders on the evolution that the business will have in the coming months."

NET SALES BY GEOGRAPHIC AREA FOR Q3

In the third quarter of 2020, Safilo posted total net sales of Euro 219.1 million, up 3.0% at current exchange rates and 6.0% at constant exchange rates, compared to Euro 212.8 million posted in the third quarter of 2019. The positive sales performance reflected the full-quarter contribution of the recent acquisitions, Blenders Eyewear and Privé Revaux, which added a total of Euro 26.5 million to the Group's North America business.

In the third quarter of 2020, Safilo's organic business, which excludes the acquisitions, achieved a significant recovery compared to the previous quarters of the year, down 6.7% at constant exchange (-5.5% for the wholesale business²) compared to the decline of 32.7% recorded in the first half of 2020 (-33.2% for the wholesale business²).

The recovery of Safilo's organic business in the third quarter of 2020 was driven by:

• strong performance in North America, where the Group's organic revenues were up 12.1% at constant exchange rates, mainly thanks to the solid sales recovery experienced by independent optical stores, Safilo's most important distribution channel in the US. All of Safilo's core licensed brands, from Kate Spade to Tommy Hilfiger to Jimmy Choo, enjoyed a solid momentum driven by the growth of the prescription frames business.

The quarter in the market was a strong confirmation for Smith products, which recorded double-digit growth in the sports store channel and more than doubled their turnover in online channels.

In North America, the Group's total sales, including the new brands acquired, stood at Euro 113.1 million, up 41.5% at current exchange rates and 45.9% at constant exchange rates compared to the same quarter of 2019;

• mixed trends in Europe, with net sales equaling Euro 79.3 million, down 17.0% at current exchange rates and 16.4% at constant exchange rates (-15.2% for the wholesale business²). In Italy and in all the main countries of the region, sales to independent optician stores posted positive performances, growing in the different markets from mid-single digit to double digits compared to the same quarter of 2019. In Europe, also the sales generated through the internet pure players confirmed their strength.

On the other hand, the recovery in order taking remained subdued, although improving compared to the second quarter of the year, in specialty channels such as boutiques, in travel retail and in big chains;

• the significant business improvement in Asia Pacific, reducing the gap compared to the same quarter of the previous year, with net sales of Euro 15.9 million down 9.4% at current exchange rates and 6.4% at constant exchange rates. The continued hardship of the travel retail business, down in the region by 63%, was more significantly offset by the surge recorded by Safilo in Mainland China, where supportive domestic demand and the contribution of the Group's new brands, namely Levi's and Ports, pushed sales up 83% at constant exchange rates;

• continued sales weakness in the Rest of the World, where Latin America and the IMEA countries remained strongly impacted by the pandemic and the economic downturns still affecting Brazil, India and Middle East markets. Net sales in the area were Euro 10.9 million, down 45.2% at current exchange rates and 35.6% at constant exchange rates.

In the third quarter of 2020, the organic online sales grew around 94% at constant exchange rates, thanks to the aforementioned growth of Smith's D2C business and the Group's sales through its internet pure players.

In the third quarter of 2020, Safilo's total online sales, including the acquisitions, represented around 16% of the Group's net sales, up from around 3% in the same period of 2019.

NET SALES BY GEOGRAPHIC AREA FOR THE FIRST 9 MONTHS

In the first 9 months of 2020, total net sales equaled Euro 554.7 million, down 21.7% at current exchange rates and 21.1% at constant exchange rates compared to Euro 708.7 million recorded in the first nine months of 2019. Safilo's organic business declined 27.8% at constant exchange rates (-28% for the wholesale business²), while the contribution of the acquisitions accounted for Euro 47.7 million in the first nine months, supporting the Group's business performance in North America. In the first 9 months of 2020, Blenders Eyewear and Privé Revaux grew respectively 79% and 96% in their pro-forma performance³ compared to the same period a year ago thanks to surging e-com activities.

In the first 9 months of 2020, Safilo's total online sales, including acquisitions, accounted for around 13% of the Group's total net sales, from 3.7% in the same period of 2019.

KEY ECONOMIC HIGHLIGHTS FOR Q3

In the third quarter of 2020, Safilo's adjusted¹ EBITDA returned to a profit, equaling Euro 14.3 million and recording an increase of 9.3% compared to the adjusted¹ EBITDA of Euro 13.1 million recorded in the same quarter of 2019. The adjusted¹ EBITDA margin improved by 30 basis points, from 6.2% to 6.5% on sales.

In the period, the Group was able to restore a higher gross profit and a better operating leverage thanks to the supportive sales dynamics previously described and the Group's continued implementation of the cost savings actions envisaged in its Group Business Plan. The latter structural savings, coupled with the utilization of ongoing contingency measures in relation to the Covid-19 emergency, resulted in an additional positive P&L impact of around Euro 13 million.

Q3 2020 gross profit increased by 3.3% to Euro 112.6 million compared to Euro 109.0 million in the third quarter of 2019, with the gross margin moving to 51.4% of sales from 51.2% in the third quarter of 2019. While production volumes remained subdued, the industrial performance reflected the positive effect of lower provisions for obsolescence, driven by the Group's tight control on inventories, and of the accretive impact of the growing online business.

Below the gross profit, SG&A expenses, excluding D&A, were just slightly up in the third quarter compared to the same period last year, notwithstanding the new costs, mainly of selling and marketing, associated with the two acquisitions. SG&A expenses of the organic business were in fact down around 14% in the third quarter, reflecting the structural savings and the utilization of the contingency measures of the period.

KEY ECONOMIC AND FINANCIAL HIGHLIGHTS FOR THE FIRST 9 MONTHS

Thanks to the progress recorded in the third quarter, Safilo managed to reduce the Group's negative adjusted¹ EBITDA in the first 9 months of 2020 to Euro 13.9 million compared to a loss of Euro 28.3 million in the first half of 2020. The Group's adjusted¹ EBITDA was a profit of Euro 54.3 million in the first 9 months of 2019.

9M 2020 gross profit was Euro 261.2 million compared to Euro 375.1 million recorded in the first nine months of 2019, with the gross margin at 47.1% of sales compared to 52.9% in the same period of 2019.

At the end of September 2020, the Group Net Debt (post-IFRS 16) stood at Euro 201.7 million (Euro 155.8 million pre- IFRS 16) compared to Euro 188.5 million at the end of June 2020 and Euro 74.8 million at the end of December 2019. The Euro 13.2 million increase recorded at the end of the third quarter compared to June 30, was in line with management's expectations in terms of higher working capital requirements following the tight management which supported the Group's liquidity needs during the second quarter.

BUSINESS UPDATE IN RELATION TO THE COVID-19 PANDEMIC

Business activity into the month of October 2020 showed a continuation of some of the positive trends recorded in the third quarter, confirming, in particular, positive organic growth in North America and solid business developments in Mainland China and some other Asian markets. Online sales remained a solid growth driver in US but also in Europe where uncertainties rose again across most countries following the rise of infections.

Given the persistence of a market environment still burdened by the Coronavirus pandemic, with a new wave of infections emerging in several countries and fresh governments restrictions on people's movement, the Group maintains a very prudent stance for the remainder of the year and remains committed to providing timely information to the market and to all stakeholders on the developments that the health emergency may have in the coming months on the Group's economic and financial results.

Notes:

¹ In the first 9 months of 2020, the adjusted EBITDA excludes non-recurring costs for Euro 11.8 million, due to restructuring expenses related to the ongoing cost saving program. In Q3 2020, the adjusted EBITDA excludes non-recurring costs for Euro 1.5 million.

In the first 9 months of 2019, the adjusted EBITDA excluded non-recurring costs for Euro 10.4 million due to restructuring expenses related to the cost saving program.

In Q3 2019, the adjusted EBITDA excluded non-recurring costs for Euro 5.4 million.

² The wholesale business excludes the business of the production agreement with Kering, reported within the geographical area of Europe.

³ Safilo Group has consolidated Privé Revaux and Blenders Eyewear in 2020, as per the respective acquisition dates of February 10, 2020 and June 1^st, 2020.

Privé Revaux and Blenders Eyewear pro-forma performance is calculated on their total net sales for the first 9 months of 2020 compared to the same period of 2019.

Statement by the manager responsible for the preparation of the company's financial documents

The manager responsible for the preparation of the company's financial documents, Mr. Gerd Graehsler, hereby declares, in accordance with paragraph 2 article 154 bis of the "Testo Unico della Finanza", that the accounting information contained in this press release corresponds to the accounting results, registers and records.

Disclaimer

This document contains forward-looking statements, relating to future events and operating, economic and financial results for Safilo Group. Such forecasts, due to their nature, imply a component of risk and uncertainty due to the fact that they depend on the occurrence of certain future events and developments. The actual results may therefore vary even significantly to those announced in relation to a multitude of factors.

Alternative Performance Indicators

The definitions of the "Alternative Performance Indicators", not foreseen by the IFRS-EU accounting principles and used in this press release to allow for an improved evaluation of the trend of economic-financial management of the Group, are provided below:

• EBITDA (gross operating profit) is calculated by adding to the Operating profit, depreciation and amortization;

• The Net Debt is the sum of bank borrowings and short, medium and long-term loans, net of cash in hand and at bank.

Conference Call

Today, at 6.15 pm CET (5.15pm GMT; 12:15pm EST) a conference call will be held with the financial community during which Q3 and first 9 months of 2020 trading update will be discussed.

It is possible to follow the conference call by calling +39 02 8020911, +44 1212 818 004, +33 1 70918704 or +1 718 7058796 (for journalists +39 02 8020927). The conference call is also available via webcast:

https://87399.choruscall.eu/links/safilo201103.html.

A recording of the conference call will be available from November 3 to November 5, 2020 on

Safilo Group Conference Call Replay Q3/9M 2020 Trading Update

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Elena Todisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

part of Safilo's sustainabile business commitment to people, product, planet

Padua, October 24, 2020 Safilo Group, a worldwide leader in the design, manufacturing and distribution of eyewear, announces the first eyewear product from recycled plastic especially made for The Ocean Cleanup, the well-known Dutch non-profit environmental organization that develops advanced technologies to extract plastic pollution from the oceans.

The Ocean Cleanup sunglasses are made with injected plastic deriving from the Great Pacific Garbage Patch (GPGP), using an innovative upcycling process able to include types of plastic that have traditionally been more difficult to recycle, turning them into a high-quality and safe material.

Available in limited-edition, each pair of sunglasses will carry a unique QR code that directly connects the user to background information about the product, the project and the specific place where the marine plastic pollution was removed from. Each pair of sunglasses is estimated to enable cleaning an equivalent of 24 football fields worth of the GPGP and when every pair from the first batch is claimed, that will equate to approximately 500,000 football fields of clean-up in the GPGP. The sunglasses will be available exclusively on The Ocean Cleanup website, and 100% of the proceeds will go to the continuation of the clean-up mission.

"I am very proud of this new project which we have developed in conjunction with The Ocean Cleanup," commented Angelo Trocchia, CEO of Safilo Group. "More than a year ago, Boyan called us and explained the project he had in mind, and we felt honoured to be part of this mission to give a second life to the plastic collected from the ocean. Our design team worked hard to combine our long history of eyewear manufacturing with material innovations to ensure the high quality, stylistic content and uniqueness of this final product. Our investment in using recycled materials is aligned with our continued efforts towards promoting a responsible business and is part of Safilo's commitment to People, Product and Planet."

"We are happy to have joined forces with Safilo, one of the top global eyewear companies, for the creation of our first product made from the trash we collected in the Great Pacific Garbage Patch. It's important that we team up with reliable brands, so I'm happy to see them added as another reputable name on our list of most valued partners," said Boyan Slat, Founder and CEO of The Ocean Cleanup. "The partnership with Safilo proved crucial in transforming the plastic we removed from the ocean into useful, durable products: these beautiful sunglasses. The proceeds from this product will help fund our mission, and we hope they serve as another way to increase global awareness of the urgent need to remove plastic from our aquatic ecosystems."

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

About The Ocean Cleanup

The Ocean Cleanup develops advanced technologies to rid the world's oceans of plastic. Founded in 2013 by Boyan Slat, The Ocean Cleanup now employs approximately 95 engineers and researchers. The foundation is headquartered in Rotterdam, the Netherlands. Instead of going after plastic debris with vessels and nets which would take many thousands of years and billions of dollars to complete The Ocean Cleanup plans to deploy a fleet of long floating barriers that act as an artificial coastline, enabling the winds, waves, and currents to passively catch and concentrate the plastic. Once fully operational, the full fleet of passive collection systems is expected to remove 50% of the Great Pacific Garbage Patch every five years' time. After years of conducting reconnaissance expeditions, scale model tests, and the deployment of prototypes on the North Sea, the first ocean cleanup systems were deployed into the Great Pacific Garbage Patch in 2018 and 2019. Once proof of technology is achieved, The Ocean Cleanup can commence full-scale cleanup and begin removing vast amounts of ocean plastic that have been accumulating in the ocean for decades. In October 2020, The Ocean Cleanup, in close cooperation with partners in the value chain, for the first time went ‘full circle' and presented its first product, made from the Great Pacific Garbage Patch, with 100% of the proceeds going to the continuation of the cleanup. Complementary to its approach to solving the legacy problem of plastic in the ocean garbage patches, the organization developed the Interceptor™ technology to help prevent plastic garbage from entering the oceans.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

ElenaTodisco

Mob. +39 339 1919562

Anna Cappozzo

Mob. +39 366 9293953

Barabino&Partners S.p.A.

Pietro Cavallera

p.cavallera@barabino.it

Tel. +39 02 72023535

Mob. +39 338 9350534

This renewal, which will now run until December 31, 2026, demonstrates the strong professional collaboration between the two Groups, whose partnership began with the presentation of the first Pierre Cardin branded collection back in 1991.

Angelo Trocchia, CEO of Safilo Group, commented: "We are very pleased to continue this partnership which has brought pride and success to both companies for many years. With this renewal we look forward to continuing our work together to build and further develop the Pierre Cardin brand in the eyewear segment. For Safilo, this brand remains an excellent fit within our portfolio thanks to its brand positioning, product styling and consumer target."

"I am extremely pleased to continue the long and successful partnership with Safilo," said Pierre Cardin. "This license agreement renewal is a confirmation of the trust that my Maison has been placing for years in the Group, which has proved to be a perfect strategic partner able to fully understand the DNA of our brand and to translate our values into collections and unique eyewear products with a contemporary design."

The latest Pierre Cardin Evolution limited edition sunglasses were presented on September 21, 2020 during the exclusive fashion show held at the Théâtre du Châtelet in Paris, on the occasion of the cinema release of the documentary film HOUSE OF CARDIN dedicated to the founder of the Maison.

Photo 1: Rodrigo Basilicati Cardin, General Manager and Designer of the Pierre Cardin Maison, together with French actress Annabelle Belmondo wearing Pierre Cardin Evolution 7 sunglasses during the event held on September 21, 2020 in Paris.

Photo 2: Joana Sanz, Spanish model and influencer, wears Pierre Cardin Evolution 8 sunglasses during the event held on September 21, 2020 in Paris.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Padua - Ph. +39 049 6986021

Maison Pierre Cardin

Sergio Esposito - Directeur des Licences

Tel. +33 1 42 66 92 25

Safilo highlights that the constructive spirit that characterized the negotiations with iVision Tech and the contribution of trade unions and regional institutions were fundamental for the outcome of this operation, which is important for local communities and the territory.

The sale of the Martignacco plant highlights the Group's commitment to optimize the production footprint and represents a further important step in the strategy to recover a sustainable economic profile.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Padua - Ph. +39 049 6986021

The main drivers that contributed to the better revenue trend (compared to the previous estimate of a moderate decline) were the more contained slowdown in the wholesale business, mainly thanks to the continued recovery recorded by the North American independent optician's market and the strong progress of Smith's online business, as well as a greater than expected contribution deriving from the Group's direct to consumer business, in particular of the recently acquired brands, Blenders and Privé Revaux.

As regards the full year 2020, Group is still unable to provide a new guidance, given the persistence of strong uncertainties on the evolution of the Covid-19 pandemic, currently intensified by growing concerns about a possible second wave of infections.

In any case, the Group remains committed to providing timely information to the market and to all stakeholders on the developments that the health emergency may have in the coming months on the Group's economic and financial results.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Padua - Ph. +39 049 6986021

SACE will guarantee 90% of the new amount borrowed, pursuant to the "Decreto Liquidità" adopted on April 8, 2020 by the Italian Government and converted into law by the Parliament, in the context of the extraordinary measures promoted to deal with the economic and social impact of the Covid-19 outbreak.

The new Term Loan Facility (the "SACE TLF"), arranged by BNP Paribas, ING Bank, Intesa Sanpaolo and UniCredit, also acting as SACE Coordinator and Agent Bank, matures on June 30, 2026, with 3 years grace period and a repayment profile in twelve quarterly instalments starting from September 2023. The facility is unsecured and pari passu with the Euro 150 million Term Loan and Revolving Credit Facility (the "2018 TLRCF") signed in 2018. The overall cost of this financing, also thanks to the guarantee issued by SACE, is lower than the current cost of the Group's debt. The SACE TLF contains the specific representations and undertakings required by the " Decreto Liquidità", along with others customary for this kind of transaction, and the possibility for the Company to cure potential future breaches of financial covenants through new subordinated loans which, upon request of the lenders, the Company has undertaken to negotiate and obtain from HAL, Safilo Group's reference shareholder through Multibrand Italy B.V., if ever needed over the duration of the financing and up to a maximum amount of Euro 30 million.

As already anticipated in the press release issued on July 31, 2020, in the context of the SACE TLF, the Company and its lenders have agreed on an amendment of certain provisions of the 2018 TLRCF, including the cancellation of the covenant test as of June 30, 2020 and a new set of covenants starting from December 31, 2020, in accordance with the terms of the SACE TLF.

In order to close the new SACE TLF and amend the 2018 TLRCF, Safilo's Board of Directors further approved, upon request of the lenders and the favourable opinion of the Related Parties Committee, certain amendments to the financing agreement of Euro 90 million entered into between Safilo S.p.A. and Multibrands Italy B.V on February 6th, 2020, including, among others, its subordination to the SACE TLF, in addition to the already provided subordination to the 2018 TLRCF, the extension of its maturity from June 30, 2023 to December 31, 2026 and some consistency amendments such as the same covenants package of the banks' financing agreements.

The information document relating to the aforementioned loan of Euro 90 million, published on February 13, 2020, as canceled and replaced on April 23, 2020, will be updated and made available within the timeframe provided for by the law.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Padua - Ph. +39 049 6986021

H1 2020 results impacted by Covid-19 and the disruption of sales in April and May

Initial business recovery in June, more significant in Europe. Sales rebound in July

Strong growth of the online business, supported by the acquisition of Blenders effective June 1^st

Free Cash Flow (before acquisitions) slightly positive thanks to effective liquidity management

New Term Loan Facility under finalization to provide additional liquidity

ECONOMIC AND FINANCIAL HIGHLIGHTS

• H1 2020 net sales at Euro 335.6 million, -32.7% at constant forex (Euro 495.9 million in H1 2019);
• Q2 2020 net sales at Euro 114.5 million, - 53.7% at constant forex (Euro 248.6 million in Q2 2019);

• Total online business doubling in H1 2020 representing 11% of Group net sales;

• H1 2020 adjusted¹ EBITDA at Euro -28.3 million (Euro 41.2 million in H1 2019);
• Q2 2020 adjusted¹ EBITDA at Euro -34.1 million (Euro 21.2 million in Q2 2019;

• H1 2020 adjusted¹ net result at Euro -63.7 million (Euro 8.5 million in H1 2019);

• Positive Free Cash Flow of Euro 2.5 million (before acquisitions) and Group Net Debt of Euro 188.5 million (post-IFRS 16), substantially in line with December 2019 excluding the impact of the acquisitions;

• End June 2020 cash position Euro 110.9 million and new Term Loan Facility under finalization subject to lending banks' and SACE credit approval processes over the coming weeks.

Padua, July 31, 2020 - The Board of Directors of Safilo Group S.p.A. has today reviewed and approved the results of the first half of 2020.

Angelo Trocchia, Safilo Chief Executive Officer, commented:

"As we had anticipated to the market in May, our second quarter sales and economic results were heavily impacted by the massive shutdown of commercial activities across the world in April, and the very gradual and patchy reopening of stores for prescription frames and sunglasses starting to occur in May as lockdowns were eased in many countries. In these two months, this business context resulted in a sales drop of approximately 75% compared to the same period last year, and in an unprecedented deleveraging of costs and negative economic performance.

In June, store traffic and conversion rates started to clearly rebound in markets like Italy, France and Germany, while the recovery of the Chinese market, which began in April, further strengthened. On the other hand, we did not experience a sales rebound yet in North America where re-openings came a bit later than Europe and were temporarily impacted by social disruptions. The growth of the US market materialized for us in July. June was a meaningful month for us for several reasons. First of all, we laid down an additional milestone in our Group Business Plan, by closing the acquisition of Blenders, a digitally native brand powered by a strong e-commerce business model which goes to enrich our proprietary brands portfolio in a crucial moment for our Group's development and for the evolution of our industry. The global pandemic has undoubtedly elevated the importance of e-commerce, as the surge of the digital commerce business has been demonstrating, continuing to grow strongly even today as stores reopen . In Safilo, we are certainly accelerating on our digital transformation projects, working to be at the forefront of seizing the opportunities of the digital business which, with the new acquisitions of Blenders and Privé Revaux, and the growth of about 31% recorded in the semester by Smith's ecom coupled with the sales to our "internet pure player" customers, has doubled compared to the same period last year.

We also continued focusing on our licensed brand portfolio, signing a new agreement for the design, manufacture and distribution of Ports branded sunglasses and optical frames in Mainland China. China is a key strategic market in our development plans, and we think that Ports is a perfect match to have locally relevant brands, not only in terms of fit but also with distinct tastes and local consumer trends.

While the evolution of the current pandemic and business environment remains highly uncertain, we remain strongly committed to taking all necessary actions to aggressively manage our industrial and operating expenses, identifying efficiencies across the organization and protecting our cash requirements by securing incremental liquidity.

Throughout our long history, Safilo has successfully navigated through many different challenges and I am firmly convinced that we will emerge also from this crisis as an even stronger organization, more agile and ready to face a rapidly changing business environment."

NET SALES BY GEOGRAPHIC AREA

In the second quarter of 2020, Safilo posted total net sales of Euro 114.5 million, down 54.0% at current exchange rates and 53.7% at constant exchange rates (-55.2% the wholesale business²) compared to Euro 248.6 million posted in the second quarter of 2019. In the first half of 2020, Group's net sales equaled Euro 335.6 million, down 32.3% at current exchange rates and 32.7% at constant exchange rates (wholesale business² -33.2%) compared to Euro 495.9 million posted in the first half of 2019.

After the positive start to the year, with the months of January and February up mid-single digit, and the business decline recorded in March following the spread of the Covid-19 pandemic in Europe, the USA and in the rest of the world, net sales declined sharply in April given the almost complete shutdown of stores, with May remaining heavily subdued as a very gradual reopening phase initiated mainly in Europe. In June, sales almost doubled compared to the previous month, recording a more limited decline of around 35% (excl. acquisitions) over the same month of last year, with differing levels of recovery among countries, cities and business segments.

In Europe, Q2 2020 net sales equaled Euro 57.2 million, down 53.0% at current exchange rates and 52.8% at constant exchange rates (-55.9% the wholesale business²) compared to the same period of last year. By the beginning of June, the majority of European markets, with the exception of UK and Ireland, reopened, with traffic and conversion rates starting to improve. In June, sales to independent optician stores turned slightly positive in the region, clearly driven by the business rebound recorded in the markets which had first been impacted by the outbreak of Covid-19, namely Italy, France and to a lesser extent Spain, where consumers favored the purchase of brands in the contemporary and mass cool segments. Within these markets, small and medium-size cities outperformed historical cities, outlets and shopping malls more affected by the lack of foreign tourists. Among the Northern European countries, Germany recorded in June the strongest improvement, driven among other things by the double-digit growth of online pure players.

In Europe, H1 2020 net sales totaled Euro 165.0 million, down 33.0% at current exchange rates and 32.9% at constant exchange rates (wholesale business² -34.0%) compared to H1 2019.

In North America, Q2 2020 net sales equaled Euro 44.1 million, down 45.3% at current exchange rates and 46.1% at constant exchange rates compared to the same quarter of last year. Safilo's wholesale revenues declined around 65% in quarter, reflecting the slower pace of re-openings which occurred in the region between May and the beginning of June, with the social turmoil affecting the country temporarily delaying the restart of commercial activities. The newly acquired businesses of Privé Revaux and Blenders Eyewear, the latter completed on June 1^st, 2020, added a total of Euro 15.7 million to the quarterly sales of North America, more than doubling their respective sales compared to their prior year business. On the positive side, also the quarterly performance of the brand Smith, whose e-commerce business in US surged around 40% in the period, allowing for a more moderate total brand decline of approximately 9% at constant exchange rates. In June, the reopening of the brick and mortar sport customers contributed to Smith double-digit sales growth compared to the same month of last year. In North America, H1 2020 net sales totaled Euro 128.5 million, declining 24.2% at current exchange rates and 26.0% at constant exchange rates compared to H1 2019.

In Asia Pacific, Q2 2020 net sales equaled Euro 8.8 million, down 65.7% at current exchange rates and 65.5% at constant exchange rates compared to the same period of last year, being the region heavily impacted in the quarter by the lack of business in the travel retail channel. On the other hand, sales in China confirmed the recovery trajectory initiated in April, closing the quarter slightly positive compared to the same period of last year. Business conditions remained instead tough in Hong Kong, Korea, Japan and in South Asian countries. In Asia Pacific, H1 2020 net sales equaled Euro 23.7 million, declining 45.4% at current exchange rates and 45.9% at constant exchange rates compared to the first half of 2019.

In the Rest of the World, Q2 2020 net sales equaled Euro 4.4 million, down 78.9% at current exchange rates and 74.3% at constant exchange rates compared to the same period of last year, mainly due to the still high impacts deriving from the persistence of important virus outbreaks in key markets such as Brazil, Mexico and India. In the Rest of the World, H1 2020 net sales equaled Euro 18.4 million, down 49.8% at current exchange rates and 46.4% at constant exchange rates compared to the first half of 2019.

In the first six months of 2020, Safilo's online sales grew by around 31% at constant exchange rates, after gaining further acceleration in the second quarter, at +38%, driven by both the US e-commerce business and the Group's sales via its internet pure player customers. The channel sales grew strongly also in June even as stores reopened. At the end of June 2020, including the newly acquired brands, Blenders and Privé Revaux, total online sales represented around 11% of the Group's net sales, from around 4% in the same period of 2019.

After the double-digit growths recorded in January and February by Carrera, Polaroid and Smith, Safilo's own core brands sales declined around 53% in the second quarter and 27% in the first half of 2020. As previously mentioned, Smith's e-commerce business was a strong, positive driver, while Polaroid and Carrera were among the key drivers of the growth recorded in Italy and France.

KEY ECONOMIC HIGHLIGHTS

The Group's second quarter and first half economic results were heavily impacted by the very limited sales activities recorded in April and May, resulting in a very negative and unprecedented deleveraging of industrial and operating expenses. This occurred notwithstanding a positive impact in the semester of around Euro 28 million (Euro 21 million in the second quarter) resulting from the extensive cost saving actions the management continued implementing in line with the Group Business Plan presented at the end of last year, coupled with the contingency measures initiated in March in relation to the Covid-19 emergency, including the use of applicable personnel relief programs in Italy and across the world.

Q2 2020 gross profit declined 71.2% to Euro 39.2 million compared to Euro 135.9 million in the same quarter of 2019, with the gross margin decreasing 20.5 percentage points to 34.2% of sales (54.7% in the second quarter of 2019). The industrial result was impacted by around Euro 7 million costs deriving from higher accruals for obsolescence, product returns, order cancellations and some fixed asset write offs. H1 2020 gross profit declined 44.2% to Euro 148.6 million compared to Euro 266.2 million recorded in the first half of 2019, with the gross margin decreasing 9.4 percentage points, to 44.3% of sales (53.7% in the first half of 2019). Excluding D&A, gross profit declined 16.5 percentage points in the quarter and 8.0 percentage points in the semester.

Below gross profit, in the second quarter, selling and general & administrative expenses declined 33.7% compared to the same period last year, with their incidence on sales drastically increasing from 48.9% to 70.4% (excl. D&A). More specifically, selling expenses decreased by 40.4% compared to the second quarter of 2019, on the one hand benefiting from the strong adjustments made by the Group to all discretionary marketing and advertising plans and activities, on the other suffering from the fixed burden represented by the accruals for the guaranteed minima to licensors for royalties and marketing contributions.

In the quarter, general and administrative expenses decreased by only 7.5% over the previous year period, as they included the impact of higher prudential bad debt allowances, for an amount equal to about Euro 6 million. Q2 2020 adjusted¹ EBITDA equaled a loss of Euro 34.1 million compared to a profit of Euro 21.2 million in the second quarter of 2019, representing an adjusted¹ EBITDA margin decline of 38.3 percentage points, to -29.8% of sales (8.5% in the second quarter of 2019). H1 2020 adjusted¹ EBITDA equaled a loss of Euro 28.3 million compared to the profit of Euro 41.2 million recorded in the first half of 2019, representing an adjusted¹ EBITDA margin decline of 16.7 percentage points, to -8.4% of sales (8.3% in the first half of 2019). H1 2020 adjusted¹ Operating result equaled a loss of Euro 55.2 million compared to an adjusted¹ Operating profit of Euro 13.3 million recorded in the first half of 2019. The adjusted ¹ Operating margin declined 19.2% percentage points, to -16.5% of sales (2.7% in the first half of 2019), also affected by the higher operating amortization recorded in the second quarter, in connection with the acquired assets of Blenders and Privé Revaux. In the first semester, net financial charges increased to Euro 11.6 million compared to Euro 2.9 million in the first half of 2019, mainly due to negative exchange rates differences and to a lesser degree to the higher average gross debt. H1 2020 adjusted¹ Net result equaled a loss of Euro 63.7 million compared to the adjusted¹ net profit of 8.5 million recorded in the first half of 2019. The adjusted¹ Net margin declined to -19.0% of sales (1.7% in the first half of 2019).

KEY CASH FLOW DATA AND LIQUIDITY UPDATE

In the first half of 2020, Safilo's management implemented a strict cash protection approach, which allowed the Group to close the period with a slightly positive Free Cash Flow generation (before the acquisitions), equal to Euro 2.5 million.

The company's operating cash requirements during the second quarter were driven by effective measures to maximize cash inflows while minimizing outflows, with the result of a temporarily positive flow from working capital. On one side, trade receivables decreased, due to continued, although subdued, cash collections from customers and the weak sales which followed the prolonged store closures, on the other side inventory levels were tightly under control, including reducing commitments and consolidating seasonal collections, and supplier payment terms were extended, either in negotiation or where applicable under governments relief schemes. In the first six months of 2020, changes in working capital thus led to a positive cash flow of Euro 56.3 million, which more than counterbalanced the negative cash flow for the economic results of the period. Cash flow for organic investment activities declined to Euro 9.3 million in the first six months (Euro 15.8 million in the first half of 2019) mainly related to maintenance Capex and the rollout of IT systems to support the Group's digital transformation strategy.

At June 30, 2020, the Group's net debt (post-IFRS 16) stood at Euro 188.5 million, a position substantially in line with the one recorded at the end of December 2019, excluding the impact, equal to a total net investment of Euro 111.7 million for the acquisitions of Privé Revaux, completed on February 10, 2020, and Blenders Eyewear, closed on June 1^st, 2020. As a reminder, these acquisitions were financed, for an amount of Euro 90 million, through a subordinated loan provided by Safilo's reference shareholder, Multibrands Italy B.V., controlled by HAL Holding N.V, and for the remaining portion through available resources.

In order to maximize cash management flexibility and responsiveness, Safilo had already in March fully drawn its Term and Revolving Credit Facility equal to Euro 150 million, of which Euro 5 million were repaid in June as part of the term loan's amortization schedule. As a result, at the end of June 2020, the Group had a cash position of Euro 110.9 million, compared to Euro 99.6 million at the end of March.

Given the high level of uncertainty still surrounding the future recovery of consumption in the different economies and in order to support the funding of current working capital and investments needs for activities located in Italy, Safilo is in the final stages of negotiations with its key lending banks for an additional term loan under the framework of the Italian "Decreto Liquidità" adopted on April 8, 2020 by the Italian government and converted into law by the Parliament, in the context of the extraordinary measures promoted to deal with the economic and social impact of the Covid-19 outbreak. As the financial covenants embedded in the existing debt have been surpassed due to the Group's operational performance during the period heavily impacted by the Covid-19 pandemic, the new financing would also include a new set of covenants which would come together with the cancellation of the covenant test in the current debt at June 30, 2020. BUSINESS UPDATE IN RELATION TO THE COVID-19 PANDEMIC

In July, preliminary net sales performance points to a business rebound, with total net sales expected to turn positive compared to the same month of last year. Business performance in North America became a clear driver of the monthly sales uplift, followed by a positive acceleration in Europe and Asia. Looking at the third quarter, the Group's management remains vigilant about the reintroduction of localized lockdowns and the differing pace of the recovery across countries, estimating total net sales (incl. acquisitions) to decline moderately compared to the same period of last year. As the evolution of the current Covid-19 pandemic remains unpredictable, with the potential impacts and effects as of today not determinable, the Group is still unable to provide a new outlook for the full year 2020, remaining committed to continue to promptly update the market and all its stakeholders on the developments that the health emergency will have on the Group's economic and financial results.

Notes:

¹ In H1 2020, the adjusted economic results excludes non-recurring costs for Euro 13.2 million (Euro 10.3 million on EBITDA), due to restructuring expenses related to the ongoing cost saving program. In Q2 2020, the adjusted EBITDA excludes non-recurring costs for Euro 7.9 million.

In H1 2019, the adjusted economic results excluded: (i) the impairment of the entire goodwill allocated to the Group's cash generating units for Euro 227.1 million, (ii) non-recurring costs for Euro 5 million (Euro 3.8 million in Q2 2019) due to restructuring expenses related to the ongoing cost saving program, and (iii) a write-down of deferred tax assets of Euro 23.3 million.

² The wholesale business excludes the business of the production agreement with Kering, reported within the geographical area of Europe.

Statement by the manager responsible for the preparation of the company's financial documents The manager responsible for the preparation of the company's financial documents, Mr. Gerd Graehsler, hereby declares, in accordance with paragraph 2 article 154 bis of the "Testo Unico della Finanza", that the accounting information contained in this press release corresponds to the accounting results, registers and records. Disclaimer

This document contains forward-looking statements, relating to future events and operating, economic and financial results for Safilo Group. Such forecasts, due to their nature, imply a component of risk and uncertainty due to the fact that they depend on the occurrence of certain future events and developments. The actual results may therefore vary even significantly to those announced in relation to a multitude of factors. Alternative Performance Indicators

The definitions of the "Alternative Performance Indicators", not foreseen by the IFRS-EU accounting principles and used in this press release to allow for an improved evaluation of the trend of economic-financial management of the Group, are provided below:

• EBITDA (gross operating profit) is calculated by Safilo by adding to the Operating profit, depreciation and amortization;
• The Net Debt is for Safilo the sum of bank borrowings and short, medium and long-term loans, net of cash in hand and at bank;
• The Free Cash Flow for Safilo is the sum of the cash flow from/(for) operating activities and the cash flow from /(for) investing activities, and the cash payments for the principal portion of IFRS 16 lease liabilities.

Conference Call Today, at 6.15 pm CET (5.15pm BST; 12:15pm EST) a conference call will be held with the financial community during which H1 2020 results will be discussed.It is possible to follow the conference call by calling +39 06 87502026, +44 844 5718892, +33 1 76700794 or +1 631 5107495 (for journalists +39 06 87500896) and entering the access code: Safilo.A recording of the conference call will be available from July 31 to August 3, 2020 on +39 06 99721048, +44 844 5718951, or +1 917 6777532 (access code: 5835079).The conference call is also available via webcast: https://edge.media-server.com/mmc/go/Safilo_results_H12020.

Interim condensed consolidated income statement

Interim condensed consolidated balance sheet

Interim condensed consolidated cash flow statement

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations Barbara FerrantePh. +39 049 6985766http://investors-en.safilogroup.com

Safilo Group Press Office Padua - Ph. +39 049 6986021

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Blenders, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan - Ph. +39 02 77807607

Padua - Ph. +39 049 6986021

Founded in San Diego in 2012 by Chase Fisher, Blenders Eyewear has built an advanced e-commerce platform, with unique digital and social media skills, achieving fast and profitable growth. The Company generates approximately 95% of its current business through its proprietary direct-to-consumer e-commerce platform.

Blenders Eyewear's value for money products are inspired by the California active and progressive lifestyle, particularly appealing to a broad range of consumers with a focus on Millennials and Generation Z, both female and male.

The brand, profitable since its inception, has fuelled its rapid growth through highly effective social marketing strategies, partnering with influencers, athletes, lifestyle enthusiasts, and product collaborations which have driven sales and brand awareness.

Blenders Eyewear closed 2019 with net sales of USD 40.7 million, up 38% compared to the previous year and with a 3-year CAGR of 174%.

Angelo Trocchia, Safilo's Chief Executive Officer, said: " The closing of the Blenders acquisition represents a big leap forward for us on the 360° digital transformation strategy we presented in December last year and which we are now accelerating in all its three key components, from the launch of the latest technologies in the B2B and CRM fields to the strengthening of digital and social marketing capabilities, to the Direct to Consumer distribution.

Blenders Eyewear is a compelling price-to-value eyewear proposition, a digitally native business model and a strong e-commerce pure player which goes to enrich our proprietary brands portfolio in a crucial moment for our Group's business development and for our industry's evolution.

We are working in difficult times, turning around our business in a challenging and fast-evolving marketplace and I am firmly convinced that a focused execution of our strategies will put our Company in a stronger position, better equipped to meet our challenges head-on and to be frontrunners in some of the new business opportunities that lie ahead ."

Chase Fisher, founder and CEO of Blenders Eyewear, commented: "We are super excited to have finalized our union with Safilo, ready to progress faster than ever on our growth and development projects.

The global pandemic's lockdowns that we have been all suffering have undoubtedly elevated the importance of e-commerce and digital channels, also pushing new consumers to shop online for the very first time.

We, at Blenders Eyewear, have seen and are experiencing this digital escalation. Our results were very solid in the first quarter of the year, with sales up more than 30%, and further accelerating in April and May. Together with Safilo, we aim to continue scaling up our digital capabilities, constantly improving the customer journey and experience, alongside pioneering new ways of engaging with ever more demanding consumers, building profitable traffic and conversion ."

The overall consideration for the 70% controlling interest in the Company is USD 63.9 million (corresponding to Euro 57.5 million).

Chase Fisher will retain full ownership of 30% of the equity interests and, pursuant to the contractual terms, these remaining equity interests are subject to customary reciprocal put and call options which can be exercised starting from 2023. Chase Fisher will remain CEO of Blenders Eyewear which will continue to run out of its San Diego home.

The acquisition has been entirely financed through the utilization of the Euro 60 million second tranche of the Euro 90 million subordinated loan provided by Safilo's reference shareholder, Multibrands Italy B.V., controlled by HAL Holding N.V., as communicated to the market on February 10^th, 2020.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

About Blenders Eyewear

Blenders Eyewear was founded in 2012 by Chase Fisher in San Diego, Calif., Blenders produces a wide range of men's and women's sunglasses and snow goggles. Driven by a company-wide motto of "life in forward motion," its products are predicated upon a bold aesthetic that emphasizes progressive colorways aimed at an active lifestyle demographic. Now a talented team of spunky and spirited designers, photographers, and communicators, Blenders is one of America's fastest-growing sunglasses brands. For more information, visit www.BlendersEyewear.com.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan - Ph. +39 02 77807607

Padua - Ph. +39 049 6986021

Blenders Eyewear Media Contact

Brooke Brumfield

Brooke@fiorpartners.com

Ph. +1 530 414 6259

Founded in Toronto in 1961, Ports was the first luxury fashion label to enter the Chinese market in the early 90s. It not only inspired the fashion sense of Chinese women, but also enormously changed their fashion style, becoming the favourite brand of well-to-do Chinese women.

"China is a key strategic market in our development plans, and we know how important it is for eyewear brands to be locally relevant to their target groups, especially in China, which is very specific, not only in terms of fitting but also with distinct tastes and local consumer trends", declared Angelo Trocchia, CEO of Safilo Group. "With the addition of such an important brand for the Mainland China market, we will be able to further expand our presence in the country by adding a high-potential and very promising business."

"The Ports brand is well known for its clean and minimalistic design and close attention to unique details and impeccable craftsmanship. These characteristics have been key for the success our collections have enjoyed since the establishment of the brand. We recognize in Safilo the best partner able to understand our distinctive DNA and translate it into the Ports eyewear collections. We count on Safilo as the best player to partner with, and together we will work to grow the eyewear category and expand it broadly throughout our country", added Rolando Santana, Director of Ports Asia Holdings Limited.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan - Ph. +39 02 77807607

Padua - Ph. +39 049 6986021

of Covid-19 (coronavirus):

• Net sales at Euro 221.1 million, down 11.5% at constant exchange rates
• Adjusted² EBITDA margin at 2.6% of sales compared to 8.1% in Q1 2019

Padua, May 06, 2020 - The Board of Directors of Safilo Group S.p.A. has today reviewed and approved Q1 2020 economic and financial key performance indicators.

As anticipated, Safilo's Q1 2020 economic and financial results were penalized by the intensifying economic and financial crisis resulting from the outbreak and spread of Covid-19 and the subsequent restrictive measures implemented by the public authorities to contain the pandemic as restrictions to people's mobility and shutdown of manufacturing and commercial activities were imposed in succession in China first, then Italy, followed by countries elsewhere around the world.

In the first two months of 2020, the Group recorded a mid-single digit increase in net sales driven by the double-digit growths recorded by all its own core brands, Carrera, Polaroid and Smith, as well as by the core licensed brands in the portfolio. In March, Safilo's business was heavily hit by the escalation of Covid-19 in Italy and, from the second half of the month, also in the other European countries and the United States.

Angelo Trocchia, Safilo Chief Executive Officer, commented:

"In a period that will probably remain unprecedented for the extraordinary challenges we are facing, our thoughts and actions have been primarily focused on the health and safety of all our people, for whom we have immediately and rigorously implemented the safety and prevention regulations provided by government protocols.

From the outset, it was for us important to focus on maintaining business continuity that would allow us to be ready to support our clients and customers, getting ready to start again together, in new ways.

Our production and logistics sites in Italy and elsewhere in the world are today partially operative to ensure production and service levels which are finetuned on new consumption scenarios, while in our Headquarters we are alternating smart working to temporary layoffs and holidays. Today we are also working on reconverting some of our production lines for the manufacturing of protective masks and visors that go to support the medical and health operators today in the front line in the fight against Covid-19.

I want to thank again each and every one of our people for the efforts they are making, the commitment and dedication they are constantly demonstrating.

In these extraordinary circumstances, we set up a global crisis team, meeting every morning and talking every day to our leaders around the world to assess how things evolve and modulate accordingly our contingency and recovery plans. We are strictly focusing on minimizing discretionary expenditures and capex, adjusting marketing plans and implementing an effective working capital and cash protection management.

In the context of the measures to contain costs, the members of the Board of Directors have renounced to part of their annual directors' compensation, and the extended global management team have renounced part of their annual compensation and vacations.

This first quarter of 2020 was characterized by a solid and very promising start, particularly positive for our own core brands portfolio, which we enriched at the beginning of February with the acquisition of Privè Revaux.

The sudden and severe halt of demand in March hit our top line and more meaningfully our profitability as the drop in sales was coupled with temporary production interruptions and supply chain inefficiencies in China, with negative effects on our industrial margin and operating leverage.

Our cash needs remained under strict control in the first quarter of the year and our Net Financial Position, excluding the acquisition of Prive Revaux, remained substantially in line with December 2019. Today we are actively utilizing our credit facilities in order to maximize cash management flexibility and responsiveness, actively assessing current and future financing opportunities, including the possibility for our Group to access the financing provided for by the so-called Italian "Liquidity Decree”.

The situation we are experiencing, although one of the most complex we have ever seen, is however offering us an additional, significant opportunity to accelerate the digital transformation we outlined in our 2020-2024 Business Plan in December last year, by fine tuning a series of actions and tools which will allow us to effectively address this new context, working better and more effectively with our clients and consumers throughout the world.

Also in these days, we continue working on several fronts to achieve these goals, in particular on the new Business-to-Business platform for clients and on new programs and initiatives to drive traffic in stores when they will reopen, on digital communication campaigns which will restart with gradual investments when the markets will be ready. And clearly an ever greater focus on e-commerce - particularly for Smith and the newly acquired brands. Last but not least the design and development of our collections to ensure an excellent product offer to inspire our clients and consumers.”

NET SALES BY GEOGRAPHIC AREA

In the first quarter of 2020, Safilo posted net sales of Euro 221.1 million, down 10.6% at current exchange rates and 11.5% at constant exchange rates (-10.8% the wholesale business¹) compared to Euro 247.3 million posted in the first quarter of 2019.

Net sales in Europe equaled Euro 107.7 million, declining by 13.5% at current and constant exchange rates (-12.2% the wholesale business¹), mainly due to the significant contraction recorded in March by the business in Italy and the other South European markets, the first and more heavily hit by the outbreak of Covid-19 and by the sudden lockdowns implemented by governments. Business performance in Germany, Northern and Eastern European countries remained instead more sustained, driven by the positive performance of Hugo Boss, Polaroid and Tommy Hilfiger.

Net sales in North America equaled Euro 84.4 million, recording a contraction of 7.8% at constant exchange rates. The performance reflected the significant deterioration of the business environment suffered by the market starting from the second week of March when an increasing number of independent optical stores, chains and department stores shut down.

In the period, Safilo's revenues in North America were supported by the acquisition of Privè Revaux, completed on February 10, 2020, which contributed for Euro 5.5 million to the quarterly sales of the region, but also by Smith's positive trends, thanks to the mid-single digit growth of its online business.

Net sales in Asia Pacific were Euro 14.9 million in the first quarter of 2020, down 17.5% at constant exchange rates. After a strong start to the year, sales to the travel retail channel and to Safilo's licensed brands boutiques were the first to be hardly hit in February due to APAC store closures and the halt of tourism.

In the Rest of the World, net sales equaled Euro 14.1 million, down 10.5% at constant exchange rates mainly as a result of the significant business deterioration experienced in Brazil, while sales trends were positive in Mexico and in the IMEA markets.

In the first quarter of 2020, total online sales grew by almost 25% at constant exchange rates, representing 6% of the Group's net sales of the period, from 4% in the same quarter of 2019.

After the promising performance recorded by the Group's own core brands in the first two months of the year, the latter closed the quarter with a moderate decrease in sales, of 3.4% at constant exchange rates, driven by Carrera and Polaroid recording a mid-single digit contraction, while Smith was slightly positive in the quarter.

KEY ECONOMIC AND FINANCIAL HIGHLIGHTS

In Q1 2020, Safilo's adjusted² EBITDA (post-IFRS 16) equaled Euro 5.8 million and a margin on sales of 2.6%, declining by 70.8% compared to the adjusted² EBITDA of Euro 20.0 million recorded in Q1 2019 (8.1% on sales).

The Group's operating performance was negatively impacted by overall supply chain inefficiencies caused by temporary production interruptions and halting of sourcing activities in China and by higher provisions for obsolescence. As a result, Q1 2020 gross profit declined by 16.0%, to Euro 109.4 million compared to Euro 130.2 million in the first quarter of 2019, with the margin on sales moving from 52.7% to 49.5%.

Below the gross margin, Safilo recorded a 230 basis point margin dilution due to the operating deleverage resulting from the significant drop in revenues suffered in March.

At the end of March 2020, the Group Net Debt (post IFRS 16) stood at Euro 135.5 million compared to Euro 105.7 million at the end of March 2019 and Euro 74.8 million at the end of December 2019. The Group Net Debt at the end of March 2020 included an IFRS 16 impact of Euro 45.5 million (Euro 79.3 and Euro 47.0 million respectively at the end of March and December 2019) and Euro 61.6 million for the acquisition of the 61.34% controlling interest in Privè Revaux (of which Euro 30 million financed through a subordinated loan provided by Safilo's reference shareholder, Multibrands Italy B.V., controlled by HAL Holding N.V., and for the remaining portion through available resources).

Excluding the acquisition, Safilo's Net Debt at the end of March 2020 was substantially in line with the position recorded at the end of December 2019.

BUSINESS UPDATE IN RELATION TO THE COVID-19 PANDEMIC

In the month of April, business activity showed a further significant deceleration compared to March, reflecting the almost complete shutdown of the various distribution channels in which the Group sells its products, with the online business been the exception.

In China, where the virus emergency seems to be normalizing, Safilo recorded in April more positive sales trends, recording a meaningful improvement compared to the exit speed of the month of March.

Despite the possibility to see such positive dynamics soon across the Group's key markets following a potential lifting and easing of lockdowns and restrictions envisaged by different governments, Safilo expects such a re-start to be very gradual and patchy between May and June, with the Group's second-quarter net sales now forecasted to decline more heavily than in the first quarter of the year and the operating result to be negative.

Given the high level of uncertainty still surrounding the Covid-19 pandemic and the future recovery of the global economy, Safilo is still unable to provide a new outlook for the full year 2020, remaining committed to continue to promptly update the market and all its stakeholders on the developments that the health emergency will have on the Group's economic and financial results.

Notes:

¹ The wholesale business excludes the business of the production agreement with Kering, reported within the geographical area of Europe.

² In Q1 2020, the adjusted EBITDA excludes non-recurring costs for Euro 2.4 million, due to restructuring expenses related to the ongoing cost saving program.

In Q1 2019, the adjusted EBITDA excluded non-recurring costs for Euro 1.1 million, due to restructuring expenses related to the ongoing cost saving program.

Statement by the manager responsible for the preparation of the company's financial documents

The manager responsible for the preparation of the company's financial documents, Mr. Gerd Graehsler, hereby declares, in accordance with paragraph 2 article 154 bis of the "Testo Unico della Finanza”, that the accounting information contained in this press release corresponds to the accounting results, registers and records.

Disclaimer

This document contains forward-looking statements, relating to future events and operating, economic and financial results for Safilo Group. Such forecasts, due to their nature, imply a component of risk and uncertainty due to the fact that they depend on the occurrence of certain future events and developments. The actual results may therefore vary even significantly to those announced in relation to a multitude of factors.

Alternative Performance Indicators

The definitions of the "Alternative Performance Indicators”, not foreseen by the IFRS-EU accounting principles and used in this press release to allow for an improved evaluation of the trend of economic-financial management of the Group, are provided below:

• EBITDA (gross operating profit) is calculated by adding to the Operating profit, depreciation and amortization;
• The Net Debt is the sum of bank borrowings and short, medium and long-term loans, net of cash in hand and at bank.

Conference Call

Today, at 6.15 pm CET (5.15pm BST; 12:15pm EST) a conference call will be held with the financial community during which Q1 2020 trading update will be discussed.

It is possible to follow the conference call by calling +39 06 87502026, +44 844 5718892, +33 1 76700794 or +1 631 5107495 (for journalists +39 06 87500896) and entering the access code: Safilo.

A recording of the conference call will be available from May 6 to May 8, 2020 on +39 06 99721048, +44 844 5718951 or +1 917 6777532 (access code: 2598721).

The conference call is also available via webcast: https://edge.media-server.com/mmc/go/Q1_2020_trading_update.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo's portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privè Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi's, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan - Ph. +39 02 77807607

Padua - Ph. +39 049 6986021

The Ordinary Shareholders Meeting has also:

1. appointed the new Board of Statutory Auditors, which is now composed of Carmen Pezzuto, appointed from the minority list presented by BDL Capital Management and accordingly appointed as Chairman of the Board of Statutory Auditors, Bettina Solimando and Roberto Padova as Standing Statutory Auditors from the majority list presented by the shareholder Multibrands Italy B.V., Marzia B. Reginato and Marco Prandin as alternative statutory auditors, respectively from the majority and the minority list. The Board of Statutory Auditors will hold office until the approval of the financial statements at 31.12.2022. The Company thanks Franco Corgnati for his important contributions during the many years of service as Standing Statutory Auditor of the Board of Statutory Auditors;


2. approved the first section of the Report on the remuneration policy and on the remuneration paid, relating to the Company's policy on the remuneration of the members of the Board of Directors, managers with strategic responsibilities and the Board of Statutory Auditors for the 2020 financial year and the procedures used for the adoption and implementation of this policy, and favourably resolved upon the second section of the Report on the remuneration policy and on the remuneration paid, relating to the items that make up the remuneration of the members of the Board of Directors, the Board of Statutory Auditors and managers with strategic responsibilities, as well as the remuneration paid to them for any reason during the 2019 financial year;


3. approved a new Stock Option Plan 2020-2022, which provides for the assignment of options granting the right to subscribe newly issued ordinary shares of the Company in favour of executive directors who are also employees and other employees of Safilo Group S.p.A. and/or other companies within the Group, who hold an important role or who play a significant role in the achievement of the medium-long term goals of the Company and the Group;


4. approved the election of Ms. Katia Buja as a new director of the Board of Directors, for the remaining term of office of the current Board, i.e., until the approval of the financial statements of the Company as of December 31, 2020, as a result of the resignation of Catherine Gérardin-Vautrin on March 24, 2020.

In the extraordinary session, the Shareholders’ meeting approved the proposal of issuance in cash, without capital increase, up to a maximum number of 7,000,000 ordinary shares without any indication of par value, with exclusion of the pre-emption right pursuant to Article 2441, Paragraph 8, of the Italian Civil Code, at the service of the above-mentioned Stock Option Plan 2020-2022.

All the documentation relating to the Shareholders meeting is available on the companys internet website at http://investors-en.safilogroup.com/investor-relations, section Corporate Governance/ Shareholders meeting.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara, Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan Ph. +39 02 77807607

Padua Ph. +39 049 6986021

As of today, given the spread of the pandemic, it is not possible to forecast what the developments will be both in terms of contagion and of the future actions taken by each government.

In this situation, Safilo has adopted all necessary measures to protect staff health and business continuity, including measures related to hygiene in all its facilities, remote working solutions for office staff and is actively working on continuity of supply chain operations.

Until today, Safilo was not significantly impacted on the supply side as sufficient stock levels at the end of 2019 granted the Group the flexibility to face the temporary shutdown of its Chinese plant in Suzhou and the difficulties encountered by Chinese suppliers during January and February. Since then, the Chinese plant has reopened and is working at almost full capacity, while most of the key Chinese suppliers are also back to normal activity levels.

On the demand side, in the first two months of 2020 Safilo recorded a positive mid-single digit increase in net sales, which was nevertheless expected to flatten out by the end of Q1, based on the preliminary data and information collected early March, after the outbreak of Covid-19 escalated in Italy, while only initial signs were experienced across Europe and in the US.

From mid-March, the spread of Coronavirus escalated also across Europe and the United States, with the most severe measures of national lockdowns and shutdowns of activities implemented in the last two weeks of March.

These extraordinary circumstances are having direct and indirect repercussions on Safilo’s economic activity, resulting in negative effects for the Group’s sales and earnings performance which are today impossible to predict for the full year. As a consequence, the 2020 outlook provided by the Company on December 10, 2019, in the context of the release of its Group Business Plan 2020-2024, is no longer valid.

As for the Group’s business development in the first quarter of the year, based on preliminary data, Safilo’s net sales are now expected to decline by 11%-13% at constant exchange rates compared to the same quarter of 2019.

Group Management has designed a mitigating action plan, focusing on minimizing discretionary expenditures and Capex, adjusting marketing plans to the new consumption scenario and implementing an effective working capital and cash protection management.

Even in the uncertain scenario described above, Management remains committed to continue pursuing the key strategies outlined in the Group Business Plan 2020-2024 presented on 10 December 2019.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

The abovementioned Shareholders’ Meeting will be also convened in an Extraordinary session to resolve on the proposal of an issuance against cash, without a capital increase, of up to a maximum number of 7,000,000 ordinary shares without par value, with the exclusion of pre-emption rights pursuant to Article 2441, Paragraph 8, of the Italian Civil Code, at the service of the above mentioned stock option plan.

The related Illustrative Report will be made available to shareholders within the terms set forth by applicable law.

The Board of Directors also informs that Catherine Gérardin-Vautrin has decided, for personal reasons, to resign from the position of independent and non-executive Director of the Board of Directors, and of Chairman of the Remuneration and Nomination Committee. The Board of Directors thanks Mrs. Gérardin-Vautrin for her appreciated contribution.

In this regard, the Board of Directors has resolved not to proceed with the replacement pursuant to Article 2386, paragraph 1, of the Italian Civil Code, in consideration of the imminence of the next Shareholders' Meeting, which will therefore also be called to appoint a new director to the Board of Directors.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Effective execution of cost savings plan marks a further significant step restoring a profitable Safilo

2019 Economic and Financial Highlights of the Continuing Operations⁴ (pre-IFRS 16), unless oTHerwise specified:

• Net sales at Euro 939.0 million, +3.1% at current exchange rates and +0.9% at constant exchange rates. Wholesale² business up +2.8% at constant exchange rates;

• Adjusted³ EBITDA at Euro 51.8 million (5.5% on sales), compared to Euro 57.3 million in 2018*;

• Adjusted³ Net loss of Euro 4.0 million, compared to a loss of Euro 14.0 million in 2018*;

• Group Net Debt of the Total Operations at Euro 27.8 million compared to Euro 32.9 million in 2018.
• Non-recurring items of Euro 295.9 million mainly related to the non-cash impairment of the entire goodwill already booked in the first half of 2019 and to the restructuring plan in Italy announced on December 10, 2019.

* 2018 economic results include an income of Euro 39.0 million for the early termination of the Gucci license.

Padua, March 11, 2020 – The Board of Directors of Safilo Group S.p.A. has today approved the Company’s consolidated financial statements for the year ended 31 December 2019¹ and examined the separate financial statements for the year ended 31 December 2019¹, which will be submitted for approval by the shareholders at the Annual General Meeting to be held in a single call on April 28, 2020.

The Board of Directors has decided not to propose the payment of a dividend to the next Annual General Meeting.

Angelo Trocchia, Safilo Chief Executive Officer, commented:

“In 2019 we continued the work started in 2018, consolidating the business foundations to develop our medium-term strategies and ambitions. Our efforts and projects focused on strengthening the customers’ trust in Safilo, strenuously improving customer care and service levels, while reshaping the commercial organization around relevant eyewear competences and strong local accountability.

Our economic results for the year were supportive, in line with the targets we had given ourselves and shared with the market, thanks to a strong execution plan to recover top line growth in our wholesale² business and restore a mid-single digit adjusted³ EBITDA margin through a strict cost optimization plan.

In 2019, our wholesale² revenues grew by 2.8% at constant exchange rates, also thanks to the positive contribution of all our core own brands Carrera, Polaroid and Smith, together posting a sales growth of 5.7% at constant exchange rates. This result is for us particularly encouraging and supportive of the strategic choice to sharpen commercial execution, focusing skills and investments in fewer, more brand-relevant markets.

2019 was a meaningful year also for our licensed portfolio, a year rich of important renewals, from Tommy Hilfiger and Kate Spade, to Hugo Boss and Marc Jacobs, and the signing of four exciting new partnerships, namely Missoni, Levis, David Beckham and Under Armour. We consider all what we achieved last year a significant statement and confirmation of Safilo’s relevance in the eyewear licensing business, where we remain strongly committed to playing a leading role.   

At the profit level, we landed where we wanted to be, with an adjusted³ EBITDA margin of our Continuing Operations⁴ at 5.5% thanks to the savings in the costs of goods sold and to our actions to reduce overhead expenses. Our balance sheet remained strong as we closed 2019 with a net debt position of Euro 27.8 million at the end of December and an adjusted⁴ financial leverage of 0.5x.

2019 can be considered a transformational year for Safilo, in which we decided to exit the retail business, selling the Solstice chain in the USA on July 1^st 2019, a year in which we were confronted with the LVMH decision to internalize its eyewear business, and in which we took the decision to pursue more decisively a digital transformation strategy, initiating the acquisition of new, relevant brands and capabilities.

December 2019 was a turning point for our Group, when we announced the acquisition of Blenders, a fast-growing digitally native California brand, which will become part of our own core brand portfolio and the most important building block to support the development of our Direct-to Consumer capabilities and business.

The latter is a key pillar of the new Group Business Plan 2020-2024 we presented in the same month of December, which also had to give a new course to our manufacturing footprint, rescaling its Italian capacity to the future production needs of the Company, safeguarding our competitiveness and financial solidity for the long term.

2020 has started under the banner of our new strategic direction, with the acquisition in February of a new brand, Privé Revaux, another enrichment of our proprietary brand portfolio and a strong fit with our millennial-focused digital strategy aimed at strengthening a marketing model strongly focused on the consumer.

After a very promising start to the new year for all our own core brands and key licenses, we are now facing the challenges posed by the outbreak and spread of coronavirus, the impacts of which we are closely monitoring while planning for mitigation actions.”

Sale of Solstice retail operations

On July 1, 2019 Safilo communicated the closing of the transaction to sell Solstice retail business for a cash consideration of USD 9.0 million. Such discontinued operations generated a total loss of Euro 26.1 million, of which Euro 17.3 related to the assets disposal and Euro 8.8 million to the net result of the chain in the period.  

2019 results and comments are provided on the Group’s Continuing Operations, which exclude the retail discontinued operations.

First adoption of IFRS 16

The Group elected to implement IFRS 16, applying the modified retrospective approach, whereby the cumulative effect of adopting the standard has been recognized at its relevant effective date on January 1^st, 2019, without the restatement of 2018 comparative information. IFRS 16 has a significant impact on the Group’s consolidated balance sheet side due to the right of use assets and lease liabilities that are now recognized for contracts in which the Group is a lessee.

In the consolidated statement of income, the majority of the current operating rental costs is now presented as depreciation of right of use assets and interest expenses on the lease liabilities, with a material positive impact in terms of EBITDA and a minor effect on EBIT and net income.

2019 results are commented on a pre-IFRS 16 basis in order to support the transition and to allow proper comparison with the previous period.

2019 non-recurring items

Non-cash goodwill impairment and write-down of assets

The Group has performed an impairment test for the purpose of its annual financial statements, which has not required further non-cash write downs compared to those already performed at the time of its semiannual results, of the entire goodwill on the Balance Sheet, equaling a charge of Euro 227.1 million, while updating the non-cash write down of deferred tax assets from Euro 23.3 million at the end of June 2019 to Euro 22.4 million at the end of December 2019.

Following the announcement, on December 10, 2019, of a restructuring plan in Italy, the Group proceeded with a non-cash write-down of fixed assets of Euro 9.0 million.

Non-recurring costs

2019 economic results include non-recurring costs for a total of Euro 39.4 million, related to the above-mentioned restructuring plan in Italy for Euro 21 million, to the cost saving program undertaken by the Company during the year and to activities linked to acquisitions and divestitures. The net result also includes a positive tax effect on the non-recurring costs themselves of Euro 1.9 million.

FULL YEAR NET SALES BY GEOGRAPHIC AREA OF THE CONTINUING OPERATIONS⁴

Safilo closed 2019 with the net sales at Euro 939.0 million, up 3.1% at current exchange rates and 0.9% at constant exchange rates compared to Euro 910.7 million in 2018.

In the second half of the year, the performance of net sales in Europe was influenced by the expected decline of the supply business related to the agreement with Kering, a contraction which mainly materialized in the 4^th quarter.

In 2019, the wholesale² revenues increased by 5.2% at current exchange rates and by 2.8% at constant exchange rates, with the latter performance driven by the positive trends recorded in Europe, up 3.2% while North America remained slightly negative, by 0.6%, despite the business recovery achieved in the 4^th quarter.

The year marked significant business progress in Asia, up 19.2% at constant exchange rates, while sales in the Rest of the World recorded an improvement of 1.1%, driven by a mid-single digit growth in Latin America.

2019 wholesale² performance was driven by the good results achieved by the Group’s own core brands Carrera, Polaroid and Smith, overall growing by 5.7% at constant exchange rates, and by the positive performance of the main licensed brands.

Q4 NET SALES BY GEOGRAPHIC AREA OF THE CONTINUING OPERATIONS⁴

In the fourth quarter of 2019, Safilo’s net sales equaled Euro 230.4 million, down 2.8% at current exchange rates and 4.3% at constant exchange rates due to the above mentioned, expected decline of the business related to the supply agreement with Kering (renewed until the end of 2023).

In the quarter, the wholesale² revenues were up 1.8% at current exchange rates and +0.1% at constant exchange rates, reflecting on one side the recovery of the North American business, up 4.2% at constant exchange rates, and the ongoing strength of Asia-Pacific, up 8.9%, on the other a decrease of 4.0% in Europe, mainly due to the strong sales recovery posted in the region in the comparative quarter of 2018. Sales in the Rest of World declined by 3.4% at constant exchange rates, driven by some business deceleration in Mexico after the strong performance posted in the first nine months of the year.

FULL YEAR ECONOMIC HIGHLIGHTS OF THE CONTINUING OPERATIONS⁴, unless oTHerwise specified

On a pre-IFRS 16 basis:

2019 gross profit grew by 5.3% to Euro 477.2 million compared to Euro 453.2 million in 2018, with the margin on sales increasing to 50.8% from 49.8% in the previous year.

It is to be highlighted that 2019 gross profit included a write-down of fixed assets, for an amount of Euro 6.6 million, booked in the fourth quarter in relation to the announced restructuring plan in Italy. Excluding this non-recurring item, 2019 gross profit increased by 6.8%, while the margin improved by 170 basis points compared to 2018. The underlying performance reflected the cost savings achieved mainly in procurement activities, lower obsolescence costs and a more favorable sales mix effect.

Below the gross profit:

• the adjusted³ EBITDA reached Euro 51.8 million and a margin on net sales of 5.5%, recording a decline of 9.6% compared to the Euro 57.3 million booked in 2018 (6.3% on sales);

• the adjusted³ Operating result equaled Euro 4.2 million and a margin on net sales of 0.5%, recording a decline of 68.6% compared to Euro 13.5 million booked in 2018 (1.5% on sales);

• net financial charges totaled Euro 5.8 million compared to Euro 13.8 million in 2018, thanks to the lower average net debt and a neutral impact from exchange rates differences;

• the adjusted³ net result equaled a loss of Euro 4.0 million and a margin on sales of -0.4%, recording an improvement of 71.8% compared to a loss of Euro 14.0 million booked in 2018 (-1.5% on sales).

When comparing 2019 results to 2018, it is important to recall that 2018 results included an income of Euro 39.0 million for the early termination of the Gucci license.  Excluding such income from the comparative period, 2019 results marked a significant recovery of the Group’s economic performance with 2019 adjusted³ EBITDA, Operating and Net results improving exponentially compared to 2018, with the margins increasing respectively by 350, 330 and 540 basis points.

Q4 ECONOMIC HIGHLIGHTS OF THE CONTINUING OPERATIONS⁴

On a pre-IFRS 16 basis:

As previously highlighted, Q4 2019 gross profit included a write-down of fixed assets, for an amount of Euro 6.6 million, in relation to the announced restructuring plan in Italy, which explains the 5.8% decline recorded in the period. Excluding this non-recurring item, Q4 2019 gross profit slightly increased, by 0.3%, compared to the same quarter of 2018, with the gross margin improving by 140 basis points.

Q4 adjusted³ EBITDA equaled Euro 7.9 million, with the margin on sales at 3.4%. This result compared to Euro 13.3 million reported in the fourth quarter of 2018, which however included the income of Euro 9.8 million for the early termination of the Gucci license.

Excluding such income from the comparative period, Q4 2019 adjusted³ EBITDA margin improved by 190 basis points compared to Q4 2018.

KEY CASH FLOW DATA OF THE TOTAL OPERATIONS

On a pre-IFRS 16 basis:

2019 Free Cash Flow equaled an absorption of Euro 13.8 million compared to the negative flow of Euro 25.6 million recorded in 2018.

In the period, the cash flow from operating activities was positive for Euro 9.6 million, benefitting from a significant improvement of the underlying operating performance and more favorable trends in net working capital compared to 2018.

Cash flow for investment activities totaled Euro 23.4 million in 2019, reflecting a total net capital expenditure of Euro 30.6 million, mainly related to investments in product supply, logistics and new IT systems, partially counterbalanced by the proceeds from the disposal of the retail business.

At the end of December 2019, Group net debt stood at Euro 27.8 million compared to Euro 32.9 million at the end of December 2018, and Euro 24.3 million at the end of September 2019. The position reflected the above-mentioned Free Cash Flow dynamics as well as the remaining proceeds, received on January 2, 2019 and equal to Euro 17.7 million, from the share capital increase executed in 2018. At the end of December 2019, the adjusted³ financial leverage stood at 0.5x compared to 0.7x at the end of December 2018.

On a post-IFRS 16 basis, 2019 Group net debt stood at Euro 74.8 million.

2020 OUTLOOK

On December 10, 2019, in the context of the release of its Group Business Plan 2020-2024, Safilo communicated its forecasts for 2020: net revenues of Euro 960 to 1,000 million, adjusted EBITDA margin (before the impact of IFRS 16) at around 6% of sales and a financial leverage of 1-1.5x.

The Group’s estimates include the acquisition of Blenders, signed and communicated on December 8, 2019 and still to be closed at the present date, while they do not include the acquisition of Privé Revaux, signed and simultaneously closed on February10, 2020. 2020 estimates furthermore do not include any potential impact deriving from the current COVID-19 (coronavirus) outbreak and spread. This latter situation, extraordinary in nature and extent, has direct and indirect repercussions on economic activities and has created a context of general uncertainty, whose evolution and related effects are not currently foreseeable. The Group is actively working to address the current challenges, and is closely monitoring potential impacts, while implementing mitigation actions.

OTHER RESOLUTIONS BY THE BOARD OF DIRECTORS

Approval of the Sustainability Report

Together with the 2019 Annual Report, the Board of Directors of Safilo Group S.p.A. approved the Sustainability Report (concerning 2019), in line with the application of the non-financial reporting obligation for listed companies under Legislative Decree 254/2016.

Amendments to the Articles of Association

The Board of Directors has also approved some amendments to the Articles of Association in order to align them to the mandatory provisions of Law No. 160/2019, which amended the provisions on gender balance in corporate bodies of listed companies.

The minutes of the meeting and the amended Articles of Association will be made available to the public in compliance with applicable law.

Notes to the press release:

¹ The auditing process of the consolidated and separate financial statements is currently under finalization.

² The wholesale business excludes the business of the supply agreement with Kering, reported within the geographical area of Europe.

³ In 2019, the adjusted economic results of the Continuing Operations exclude: (i) the impairment of the entire goodwill allocated to the Group’s cash generating units of Euro 227.1 million, (ii) the write-down of deferred tax assets of Euro 22.4 million, (iii) the write-down of fixed assets of Euro 9.0 million for the restructuring plan in Italy, announced on December 10, 2019, (iv) non-recurring costs of 39.4 million, related to the above-mentioned restructuring plan in Italy for Euro 21 million, to the cost saving program undertaken by the Company during the year, and to activities linked to acquisitions and divestitures. At the net result level, there was a positive tax effect on the non-recurring costs themselves of Euro 1.9 million.

    In Q4 2019, the adjusted EBITDA excludes non-recurring costs for Euro 29.0 million, the corresponding part of the above indicated Euro 39.4 million.

In 2018, the adjusted economic results excluded non-recurring costs for Euro 5.8 million, mainly related to the CEO succession plan and reorganization costs in North America and Europe, and included an income of Euro 39.0 million, annual portion of the total Euro 90 million accounting compensation for the early termination of the Gucci license.

In Q4 2018, the adjusted EBITDA excluded non-recurring costs for Euro 1.3 million and included an income of Euro 9.8 million, as pro-rata portion of the annual accounting compensation for the early termination of the Gucci license.

⁴ Continuing Operations exclude the Group’s discontinued Retail operations sold on July 1^st, 2019.

⁵ In 2019, the adjusted economic results of the Total Operations also exclude non-recurring items related to the retail discontinued operations: (i) Euro 17.3 million for the loss on disposal and (ii) non-recurring costs for Euro 1.3 million.

APPENDIX

ECONOMIC HIGHLIGHTS OF THE TOTAL OPERATIONS

Statement by the manager responsible for the preparation of the company’s financial documents

The manager responsible for the preparation of the company’s financial documents, Mr. Gerd Graehsler, hereby declares, in accordance with paragraph 2 article 154 bis of the “Testo Unico della Finanza”, that the accounting information contained in this press release corresponds to the accounting results, registers and records.

Disclaimer

This document contains forward-looking statements, relating to future events and operating, economic and financial results for Safilo Group. Such forecasts, due to their nature, imply a component of risk and uncertainty due to the fact that they depend on the occurrence of certain future events and developments. The actual results may therefore vary even significantly to those announced in relation to a multitude of factors.

Alternative Performance Indicators

The definitions of the “Alternative Performance Indicators”, not foreseen by the IFRS-EU accounting principles and used in this press release to allow for an improved evaluation of the trend of economic-financial management of the Group, are provided below:

• EBITDA (gross operating profit) is calculated by Safilo by adding to the Operating profit, depreciation and amortization;
• The Net Debt is for Safilo the sum of bank borrowings and short, medium and long-term loans, net of cash in hand and at bank;
• The Free Cash Flow for Safilo is the sum of the cash flow from/(for) operating activities and the cash flow from /(for) investing activities.

Conference Call and Webcast

Today, at 6.30 pm CET (5.30pm BST; 1.30pm EST) a conference call will be held with the financial community during which Full Year 2019 results will be discussed.

It is possible to follow the conference call by calling +39 06 87502026, +33 1 76700794, +44 844 5718892 or +1 631 5107495 (for journalists +39 06 87500896) and entering the access code: SAFILO.

A recording of the conference call will be available until March 13, 2020 on +39 06 99721048, +44 844 5718951 or +1 917 6777532 (access code: 3193195).

The conference call can be also followed live in webcast: https://edge.media-server.com/mmc/go/SafiloFY2019Results

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded net revenues for Euro 939 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

“We are pleased to welcome to our portfolio one of the coolest French designer brands whose unique expression and iconic style ensure it stands out within the advanced luxury design segment. This positioning between contemporary and traditional luxury allows design-driven, trend-setting brands, such as Isabel Marant, to captivate and engage Gen Z and Millennials with their originality, recognition and authenticity,” commented Angelo Trocchia, CEO of Safilo Group. “We will focus on reflecting the brand’s distinctive Parisian style through its eyewear collections to appeal to women both in France and throughout the world and expand the brand in this important product category.”

“Safilo’s expertise and capabilities in the design, development and manufacturing of eyewear, as well as their qualitative and widespread distribution reach, are the critical factors that lead us to take this exciting challenge of entering into our first ever eyewear licensing agreement. We were looking for a partner capable of translating our idea of a sartorial interpretation into an accessory that is emblematic of present-day style,” stated Isabel Marant. “With Safilo we share the same creative energy and enthusiasm for experimenting and we are sure that together we will able to delight our clients in France and beyond.”

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2019 Safilo recorded preliminary net sales for Euro 939 million.

About Isabel Marant

Say Isabel Marant, think Parisian flow. Having founded her label in ’94, she instantly became renowned for her pioneering and cosmopolitan spirit bringing self-affirmation and feel good effect to her 'dégaine'. To do so, ever since her launch, she has been trying on each garment before it leaves her studio to ensure everything works in the everyday life of a real woman.

Isabel Marant: “I design clothes for women who want to have style while keeping their own personality. The kind of women who remain genuine but who are stamped with a hidden and remote sophistication.” 

Contacts:

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Isabel Marant

isabelmarant@kcdworldwide.fr

Ph. +33 1 49 96 20 70

The entry of the first cars with Full Hybrid technology is part of a more extensive program for the total conversion of Safilo’s vehicle fleet towards sustainable mobility: already in 2020, the Company plans to include around 100 new cars equipped with the most advanced Full Hybrid technology of the Toyota Group, gradually replacing the rest of the fleet in Italy and abroad.

The Toyota Group’s Full Hybrid Electric technology allows not only to reduce the consumption and emissions of climate-altering gases harmful to human health, but also guarantees the best possible compromise between engine efficiency, emissions and performance. All this without any change in driving habits and without the need for external recharging.

“Innovation and continuous research for excellence have always been part of Safilo’s DNA and are the drivers that today support us in making responsible choices towards the desire to reduce the environmental impact both individually and at a company level,” commented Angelo Trocchia, CEO of Safilo Group. “For this reason, we have turned to a partner like Toyota recognized for its global capabilities in the development of hybrid technology cars to bring us even closer to the objectives of reducing greenhouse gas emissions. We have already made tangible progress on fronts such as the efficiency of water and energy consumption in our manufacturing sites, and we are more determined than ever to go much further in the name of sustainability.”

“We are very proud that, in terms of mobility, Safilo has chosen our Full Hybrid Electric technology in its path to reduce environmental impact,” said Mauro Caruccio, CEO of Toyota Motor Italia. “The Full Hybrid Electric that equips Toyota and Lexus cars is today the most immediate solution for creating sustainable mobility accessible to all, as demonstrated by the 15 million customers around the world who have placed their trust in us. The partnership with Safilo is based on sharing the same values: innovation and attention to environmental issues.”

Safilo’s sustainable change towards mobility is part of an energy efficiency plan and a progressive reduction of the ecological footprint of all the Company's activities, which has as its objective lower CO₂ emissions, a reduction in polluting consumption and therefore also greater protection of the environment and health. Issues that have always played a central role in Safilo’s social responsibility programs, which put sustainability at the heart, not only as a safeguard of environmental resources but also as a guarantee of long-term social and economic growth.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded preliminary net sales for Euro 939 million.

Toyota

The Toyota group, with its Toyota and Lexus brands, is a world leader in the field of electrified engines, with 15 million hybrid-electric cars sold worldwide since 1997. This confirms a concrete commitment in helping to achieve sustainable mobility thanks to the reduction of climate change (CO2) and polluting factors harmful to human health (NOx). NOx emissions are in fact more than 90% lower than the limit set by current legislation, for example on Yaris Hybrid the emissions of nitrogen oxides are only 6 mg / km and on Lexus UX 4.9 mg / km, compared to expected limit of 60 mg / km of Euro6 petrol cars and 80 mg / km of Euro6 diesel. The Full Hybrid Electric technology is easy to use, capable of independently managing the synergy of operation between conventional and electric engines, in an exclusive or combined manner, in view of the best possible compromise between energy efficiency, emissions and driving performance. Toyota also believes in creating a totally sustainable society, in which everyone can overcome their limits by making use of mobility systems that are not related only to cars and that allow them to move freely and without obstacles and barriers, both physical and social. This is the goal of the global 'Start Your Impossible' campaign, through which Toyota promotes the value of inclusiveness [Mobility for All]. With this in mind, the Toyota Team was chosen in Italy, made up of Italian athletes belonging to the various Italian Olympic and Paralympic disciplines.

Contacts: 

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021 

Toyota

Sabrina Caputi

sabrina.caputi@toyota-europe

Riccardo Taglioni

riccardo.taglioni@toyota-europe.com

https://newsroom.toyota.it/

ECONYL^® is a regenerated nylon obtained through the regeneration and purification process of plastic waste, such as fishing nets, old carpets, and fabric scraps. ECONYL^®, obtained through a process of depolymerization and re-polymerisation, performs exactly the same as brand new nylon and it can be recycled, recreated and remoulded again and again, with no loss of quality.

The choice of this material, never before used in the mass production of eyewear, is a tangible sign of Safilo’s further progression in its sustainability strategy and its commitment to bring innovation to a consolidated industry. “Our investment to using recycled materials highlights our continued efforts towards promoting a responsible business,” explains Angelo Trocchia, CEO of Safilo Group. “This sustainable material will allow us to make our contribution and create products without using new resources. Our intention is to expand the use of ECONYL^® as much as possible in order to decrease our carbon footprint.”

“Safilo has a long history of creating high-quality eyewear products, and we are happy to partner with such a strong player in the eyewear industry,” said Giulio Bonazzi, Aquafil’s CEO. “It is a completely new sector in which our ECONYL^® material is now used, and it is this pioneering spirit that most unites us with a company like Safilo, which, like us, has innovation in its DNA.”

The new TOMMY JEANS eyewear collection, recently launched by Tommy Hilfiger, one of the licensed brands in Safilo’s portfolio, is the first that features styles made of ECONYL^® regenerated nylon. Safilo will progressively introduce this material also in its other brands’ collections.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, Privé Revaux, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded preliminary net sales for Euro 939 million.

About Aquafil

Aquafil is a global company that produces polymers and synthetic fibers. Since 2011, as part of an ambitious circularity project, it has implemented a regeneration system where nylon waste, such as fishing nets, old carpets, and scraps are transformed into ECONYL^® regenerated nylon. To date, this product represents more than one-third of the entire Aquafil’s production.

The ECONYL^® ingredient is used by hundreds of fashion, carpet and home design brands in their creations.

Through its direct presence in 8 countries and 3 continents, Aquafil has been able to activate a virtuous network of partners, along the value chain, which aims to pursue sustainability for each production activity, in the unceasing attempt to decrease the impact of human activities on the environment and the planet.   

Contacts:

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Barabino & Partners

Federico Vercellino

f.vercellino@barabino.it

Ph. +39 331 5745171; +39 02 72023535

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

David Schottenstein (the Company’s founding entrepreneur and Chief Executive Officer) retains ownership of approximately 15.5% of the equity, while the remainder is held by celebrities Jamie Foxx, Hailee Steinfeld and Ashley Benson, senior management of the Company, and certain other investors. Private equity fund TSG Consumer Partners and its affiliates sold their entire stake in Privé Revaux to Safilo Group and other equity holders of the Company.

Founded in 2017, Privé Revaux was built on a shared passion for style and quality with the goal of disrupting the eyewear industry and making premium, quality eyewear products accessible to everyone. Gaining instant traction with consumers, the fast-growing US eyewear brand is fueled by a strategic celebrity ecosystem, merged in high caliber social media engagement and strong digital marketing capabilities.

Privé Revaux has extended its assortment of affordable and quality frames beyond traditional sunglasses into blue light blocking glasses to combat digital eye strain and has brought their unique, fashion-forward perspective to reading glasses. The company distributes through a broad set of channels and retail partners, both online and offline.

Since inception, Privé Revaux has carefully curated relationships with celebrities who wear and endorse its products. Catering to a diverse fanbase, the brand has levered its celebrity appeal to new customers through a distinctive capsule collection program of co-branded styles designed by major celebrity influencers, and is continually adding to its roster of talent with new collections seasonally.

In 2019 the Company recorded net sales of approximately USD 20 million, up around 90% compared to the previous year, and plans to continue strongly growing them in 2020.

Angelo Trocchia, Safilo’s Chief Executive Officer, said: “We are very pleased to enrich our proprietary brand portfolio with Privé Revaux, a fast-growing US-origin brand, which contributes a millennial-focused digital marketing strategy and whose mission is to offer affordable, high-quality, beautifully designed eyewear, using celebrities’ endorsements to drive brand awareness and sales.

Privé Revaux has successfully created a repeatable and scalable strategy with celebrity capsule programs that can be introduced into various markets around the world, a consumer-centric marketing model from which we can learn and leverage on, while putting our capabilities at its disposal for its global expansion..”

David Schottenstein, founder and CEO of Privé Revaux commented: “This is a monumental moment for Privé Revaux, and a true turning point in our business. We have worked tirelessly to bring consumers tangible quality and style when it comes to eyewear, at a fair and reasonable price and Safilo believes in our vision and goal. I couldn’t be prouder of what this brand has accomplished in only a few short years, and with Safilo in our corner, the sky’s the limit.”

“When we started Privé Revaux we knew we were going to shake things up, we just didn’t realize how quickly and to what extent. Now, with Safilo’s know-how and expertise, we can turbo charge this and take it to a completely different level, on a global scale.” Jamie Foxx, Partner and Co-Founder, Privé Revaux.

“Getting together with a company like Safilo is truly an honor and really says a lot about who we are as a brand. Looking at our opportunities, both in terms of continuing to grow Privé Revaux and in terms of really helping to grow Safilo’s existing brands, it is obvious to me that this made sense and was meant to be. I am so excited for the coming years and am very much looking forward to working with Safilo.” Hailee Steinfeld, Partner and Co-Founder, Privé Revaux.

“We live in a fast-changing world, specifically a fast-changing retail world. Clearly Safilo has the vision to see that Privé Revaux can help Safilo create something new in eyewear and I very much look forward to being a part of that.” Ashley Benson, Partner and Co-Founder, Privé Revaux.

The overall consideration for the 61.34% controlling interest in the Company is USD 67.5 million (corresponding to €61.6 million at the exchange rate on the announcement date).

The equity interests held by David Schottenstein and the other minority equity holders are subject to customary reciprocal put and call options which can be exercised starting from 2023. David Schottenstein will remain CEO of Privé Revaux which will continue to run out of its Miami headquarters.

The acquisition has been financed partially through a loan provided by Safilo’s reference shareholder, Multibrands Italy B.V., controlled by HAL Holding N.V., and for the remaining portion through available resources.

With respect to the Company’s  communication on December 9^th, 2019,  the financing contract approved by Safilo’s Board of Directors on December 1^st, 2019 has been replaced by a new single financing contract entered into between Safilo S.p.A. and Multibrands Italy B.V on February 6^th, 2020 for a total amount of EUR 90 million. As mentioned above, this single loan agreement is aimed at financing in part, for Euro 30 million, the acquisition of Privé Revaux, and at fully financing the acquisition of  Blenders Eyewear LLC, as communicated to the market on December, 9th, 2019, upon its closing date.

The loan is subordinated to Safilo Group’s existing financing signed in October 2018 with its lending banks.

The loan executed with Multibrands Italy B.V. represents a “transaction with a related party of greater importance” as the Equivalent-value relevance ratio (i.e. the ratio between the counter value of the loan and the consolidated shareholders’ equity as at June 30th, 2019) is above the threshold of 5%.

As such, the execution of the loan agreement has been approved by the Board of Directors on February 6^th, 2020 upon the favourable opinion of the Related Parties Committee dated February 4^th, 2020, on the interest of the Group in entering the loan and on the convenience and substantial fairness of the relevant terms and conditions.

The required informative document will be made available within the timeframe provided for by the law.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded preliminary net sales for Euro 939 million.

About Privé Revaux Eyewear

Privé Revaux Eyewear was established to disrupt the eyewear market as a purveyor of quality goods at a great value.  It was built on a shared passion for style and quality from entrepreneur David Schottenstein along with an elite team including celebrity visionaries Jamie Foxx, Hailee Steinfeld and Ashley Benson as well as VP of Celebrity Relations Dave Osokow and Creative Directors Rob Zangardi and Mariel Haenn.  With more than 100 hand-crafted and polarized designer frames starting at $29.95, everyone can be anyone.  For more information, visit www.priverevaux.com.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Privé Revaux Media Contact

Lauren.Weissman / Rogers & Cowan PMK

lauren.weissman@rogersandcowanpmk.com

Ph. +1 212 878 5109

Preliminary¹ 2019 net sales of the Continuing Operations² equaled Euro 939.0 million, up 3.1% at current exchange rates and 0.9% at constant exchange rates compared to Euro 910.7 million in 2018.

The wholesale³ business increased by 5.2% at current exchange rates and by 2.8% at constant exchange rates, confirming the expectation outlined by the Group on December 10, 2019. In 2019, the performance at constant currency of the wholesale³ revenues was positive by 3.2% in Europe, while it remained slightly down, by 0.6% in North America despite the business recovery achieved in the 4^th quarter.

The year marked significant business progress in Asia, up 19.2% at constant exchange rates, while sales in the Rest of the World recorded an improvement of 1.1%.

2019 wholesale³ performance was driven by the good results achieved by the Group’s own core brands Carrera, Polaroid and Smith, overall growing by 5.7% at constant exchange rates, and by the positive performance of the main licensed brands.

In the 4^th quarter of 2019, the quarterly wholesale³ performance was up 1.8% at current exchange rates and +0.1% at constant exchange rates, reflecting on one side the abovementioned recovery of the North American business, up 4.2%, and the ongoing strength of Asia-Pacific, up 8.9%, on the other a slowdown of 4.0% in Europe. Preliminary¹ total net sales of the Continuing Operations² in the quarter equaled Euro 230.4 million, down 2.8% at current exchange rates and 4.3% at constant exchange rates mainly due to the expected decline in Europe of the business related to the supply agreement with Kering, which as was communicated in October 2019, has been renewed until the end of 2023.

Preliminary¹ net sales of Continuing Operations² by geographical area:

In addition, on a preliminary¹ basis and pre-IFRS 16, Safilo confirms for 2019 an adjusted⁴ EBITDA margin of the Continuing Operations² at 5.5% and a Group net debt around Euro 30 million.

Notes to the press release:

¹ Preliminary net sales of the Continuing Operations, adjusted EBITDA and Group net debt for 2019 are unaudited.

² Continuing Operations exclude the Group’s discontinued Retail operations.

³ The wholesale business excludes the business of the production agreement with Kering, reported within the geographical area of Europe.

⁴ The adjusted EBITDA excludes non-recurring.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its designs into high-quality products according to the Italian tradition. Through an extensive wholly owned network of subsidiaries in 40 countries and more than 50 distribution partners in key markets throughout North and Latin America, Europe, Africa, the Middle East, Asia Pacific and China, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale worldwide. Safilo’s portfolio encompasses its own core brands Carrera, Polaroid, Smith, Safilo, and licensed brands Dior, Dior Homme, Fendi, Banana Republic, BOSS, David Beckham, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Levi’s, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara., Missoni, M Missoni, Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded net revenues for Euro 962.9 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Padua, December 10, 2019 – The Board of Directors of Safilo Group S.p.A. has today approved the new Group Business Plan 2020-2024.

The new Plan incorporates the effects of the Group’s most recent business developments, and in particular:

• the sale of the Solstice retail business, which took place on July 1^st, 2019;
• the extension of the brand Marc Jacobs until December 31^st, 2026; the exit of the brand Dior from January 1^st, 2021; the exit of the brand Fendi from July 1^st, 2021;
• the renewal of the Tommy Hilfiger, Hugo Boss and Kate Spade licenses;
• the renewal of the supply agreement with Kering Eyewear;
• the launch of the new licenses signed during 2019, namely Missoni and M Missoni, Levi’s, David Beckham, and Under Armour, an iconic sports brand just recently signed;
• the acquisition of Blenders Eyewear, a fast-growing California digitally-native brand, which will enrich the Group’s proprietary brand portfolio and direct-to-consumer business.

The strategic objectives and levers of the Group’s new Business Plan are:

• to develop a modern and successful Customer-centric and Consumer-oriented business model, powered by a new 360° digital transformation strategy;

• to deliver Sales Growth, by placing customers and consumers at the heart of the strategy, and accelerating initiatives to digitally transform the Company’s business model. Over the coming 5 years, starting from 2020 in Europe, Safilo intends to strengthen and enlarge its client base by pursuing a customer-centric strategy, redesigning its Customer Experience, Engagement and Customer Care activities through the adoption of the latest technologies in the B2B, CRM (Customer Relationship Management) and salesforce automation fields;
  
  The Group will continue developing a multi-segment and multi-channel portfolio strategy by also accelerating projects to build an ever-closer connection with the end consumers. Safilo is pursuing this strategic choice through a more decisive digital shift of its mix of capabilities and investments, from digital and social marketing to Direct-to-Consumer distribution, a channel in significant growth in which Safilo wants to accelerate both through strategic commercial partnerships and through the acquisition of new important capabilities, as the acquisition of Blenders Eyewear testifies. This brand has in fact built an advanced direct-to-consumer e-commerce platform with unique digital and social media skills, successfully engaging and selling to Millennials and Generation Z consumers;

• to deliver Margin Expansion, through an efficient cost structure, which responds to the requirement to realign the Group’s current industrial capacity to the future production needs and to achieve further costs of goods sold and overheads efficiencies, guaranteeing the Group’s economic and financial solidity and the pursuit, during the Plan’s timeline, of a recovery of the levels of profitability to which Safilo aspires.
  
  The exit of the LVMH luxury licenses makes it necessary for Safilo to initiate an industrial reorganization and restructuring plan, promptly responding to the new production scenario that the Company will be facing, by realigning its manufacturing footprint.
  
  The plan, which is drawn up to safeguard the Group's competitiveness in favour of the workers who will remain in force, identified a total of approximately 700 redundancies in 2020 in Italy.
  
  Safilo has opened a negotiation table with the trade unions and the workers' representatives in order to identify all the available social security tools to manage the impact on the people involved in the best possible way.

Angelo Trocchia, Chief Executive Officer, commented: “We are today updating and extending our Group Business Plan, confirming the strategic objective to deliver business growth, leveraging the significant progress achieved in the last 18 months thanks to a tight action plan to recover top line growth and operating margins.

There are clear challenges and opportunities posed by the evolutions of the market context, from the internalization of luxury eyewear by the two key industry players, to the ongoing industry consolidation and digitalization. Today, at Safilo, we are facing them all, with a pragmatic approach, updating and upgrading our business model with clear, new and necessary choices.

We will continue preserving and enhancing our undisputed leadership in design, product development and innovation, our global commercial footprint and our strong know-how in brand management to continue pursuing a high-potential multi-segment brand portfolio strategy. At the same time, we are now upgrading our business model through a more decisive shift towards a digital transformation strategy, which will support and enable significant improvements of our customer-centric activities through the adoption of innovative, state of the art digital contents and services, as well as allow a more significant growth of our Direct-to-Consumer e-commerce activities through an increasing mix of internal and external capabilities and investments.

Today, we also need to reorganize our manufacturing footprint by realigning its current capacity to our future production needs, thus safeguarding the Group’s competitiveness and financial solidity for the long term. Despite the call for the emergence of alternative solutions, the new industrial plan ultimately impacts a significant number of people, for whom we will activate all the best possible and most responsible solutions, working closely with trade unions and workers’ representatives. 

With our economic and financial targets, we aim for Safilo to become a modern leader of the eyewear industry, a more balanced and profitable player across its markets, brands and product segments.”

PLAN ESTIMATES

OUTLOOK FOR THE CURRENT YEAR:

Safilo expects to close the 2019 fiscal year with the net sales of the Continuing Operations substantially stable compared to 2018, while the wholesale¹ business is estimated to grow by approximately 3% at constant exchange rates, reflecting the positive performance achieved by the Group’s own core brands, Carrera, Polaroid and Smith, in their key markets. 

2019 adjusted² EBITDA margin of the Continuing Operations is expected to be around 5.5% of sales, confirming the significant progress made throughout the year, on an organic basis, thanks to the improvements recorded at the gross margin level and the strong recovery of overhead costs.

2020 REVISED TARGETS:

For 2020, the Group now forecasts net revenues of Euro 960 to 1,000 million, versus the Euro 1,000 to 1,020 million target provided on August 2, 2018, and an adjusted² EBITDA margin (before the impact of IFRS 16) at around 6% of sales compared to the previous objective of an 8% to 10%.

It should be noted that this variance follows the confirmed exit of the Dior license after 2020, as communicated by the Company on July 1, 2019, and the new plan thus reflects the expected decline of the Dior business in its last year of license in Safilo, a period of phase-out which will negatively impact the brand’s overall profitability.

GROUP BUSINESS PLAN 2020 -2024 ECONOMIC AND FINANCIAL TARGETS:

• a wholesale¹ revenues CAGR, including all the new licenses signed during 2019, of around 4%, able to offset a significant part of the business decline, mainly expected in 2021 for around Euro 200 million, due to the exit of the LVMH luxury licenses.
  
  The Group expects to achieve this goal through a mid-single digit growth in North America and low-single-digit upside in its main European markets. A higher contribution is then expected from the main emerging markets, in which some of the new brands in the license portfolio will play a significant role.
  
  Safilo foresees its core own brands, Carrera, Polaroid and Smith, to grow faster than Group average, further building on the positive achievements of the most recent execution plans in terms of product, distribution and communication strategies.
  
  The development of optical frames is confirmed as a strategic lever to support the growth plans of the Group's main brands, including all its core licenses for which Safilo also expects to foster product development projects which place an increasing focus on sustainability.

• an additional top line growth to be achieved through the acquisition of the brand Blenders Eyewear, for which Safilo targets a double-digit sales CAGR over the Plan period. This acquisition, together with the foreseen development of Smith, Carrera and Polaroid’s D2C platforms, is expected to boost the share of the Group’s business made through the Direct-to-Consumer e-commerce channel, to represent around 15% of total net sales by 2024, and the share of own brands to reach approximately 50% of the Group’s wholesale¹
  The plan does not include any impact of additional acquisitions or new licenses not yet signed.

• significant progress to be made by its wholesale¹ business, leveraging positive top line growth dynamics coupled with the implementation of a further cost productivity plan to allow additional savings for around 45 million Euro;
• an additional positive contribution to be achieved through the acquisition of the brand Blenders Eyewear;

• extraordinary restructuring costs of around Euro 50 million, globally;

• the incidence of CapEx investments on sales to decrease from ~3% to ~2% at the end of the Plan, a period in which the mix of capital expenditure, for an expected cumulated amount of around Euro 120 million, will also change in favour of the projects to digitally innovate the Group business model.

It is to be highlighted that the Plan targets listed above are expressed at constant 2019 exchange rates, and for 2020 exclude the impacts deriving from the application of IFRS 16 (to ensure comparability with the previously provided guidance) and for 2024 include the impacts deriving from the application of IFRS 16. The application of IFRS 16 increases the Group’s EBITDA margin by approximately +1% compared to the reporting pre-IFRS 16.

Notes to the press release

¹ The wholesale business excludes the business of the supply agreement with Kering, reported within the geographical area of Europe.

² Adjusted EBITDA excludes non-recurring and restructuring costs.

Conference Call and Webcast

The Group Business Plan 2020-2024 will be discussed tomorrow, December 11, 2019, starting at 8.30am CET (7.30am GMT and 2.30am US EST) during a presentation to the financial community in Milan.

It is possible to follow the presentation live via conference call and audio webcast:

• Dial in numbers for analysts and investors: +39 02 802 09 11, +33 170 91 8704, +44 1212 818 004 and +1 718 7058 796. For journalists +39 02 802 09 27
• Webcast at http://87399.choruscall.eu/links/SafiloGroupBusinessPlan.html

A recording of the conference call will be available from December 11 until December 13, 2019 on +39 02 72495, +44 1 212 818 005 or +1 718 705 8797 – passcode: 744#.

The presentation will be available and downloadable from the Company’s website.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its design projects into high-quality products created according to the Italian tradition. With an extensive wholly owned network of subsidiaries in 40 countries – in North and Latin America, Europe, Middle East and Africa, and Asia Pacific and China – and more than 50 distribution partners in key markets, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale all over the world. Safilo’s portfolio encompasses: own core brands Carrera, Polaroid, Smith, Safilo, and licensed brands: Dior, Dior Homme, Fendi, Banana Republic, BOSS, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara, Max&Co., Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded net revenues for Euro 962.9 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

The renewal of this partnership, that has reached its 15^th year of collaboration, further strengthens Safilo’s portfolio in the contemporary segment, while extending the positioning of the brand in the luxury segment with the launch of the Marc Jacob’s Runway eyewear collection which will hit the market in January 2021.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and related products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its design projects into high-quality products created according to the Italian tradition. With an extensive wholly owned network of subsidiaries in 40 countries – in North and Latin America, Europe, Middle East and Africa, and Asia Pacific and China – and more than 50 distribution partners in key markets, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale all over the world. Safilo’s portfolio encompasses: own core brands Carrera, Polaroid, Smith, Safilo, and licensed brands: Dior, Dior Homme, Fendi, Banana Republic, BOSS, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara, Max&Co., Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded net revenues for Euro 962.9 million.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Padua/San Diego, December 9, 2019 – Safilo Group announces the acquisition of a 70% stake in the equity of the California company Blenders Eyewear LLC (the “Company”). Safilo Group purchased the stake from the company’s founding entrepreneur and full owner.

Founded in San Diego in 2012 by Chase Fisher, Blenders Eyewear has built an advanced e-commerce platform with unique digital and social media skills, which has achieved fast and profitable growth thanks to its world-class digital capabilities. The Company generates approximately 95% of its current business through its proprietary direct-to-consumer e-commerce platform, more recently complemented by the opening of the first Blenders flagship store in San Diego. 

Blenders Eyewear’s products are inspired by the California active and progressive lifestyle and offer a compelling price-to-value eyewear proposition, particularly appealing to a broad range of consumers with a focus on Millennials and Generation Z, both female and male.

The brand, profitable since its inception and with strong current profitability, has fuelled its rapid growth through highly effective social marketing strategies, partnering with influencers, athletes, lifestyle enthusiasts, and product collaborations which have driven sales and brand awareness.

In 2019 the Company expects to reach profitable net sales of approximately USD 42 million, all generated in the United States and up around 40% compared to the previous year and with a 3-year CAGR of 175%.

Angelo Trocchia, Safilo’s Chief Executive Officer, said: “We are thrilled to welcome to Safilo an inspiring brand like Blenders Eyewear, a fast-growing e-commerce-powered business at the forefront of the latest direct to consumer and omni-channel capabilities, which will enrich our proprietary portfolio with new strong skills and a particular focus on our key US market.

Blenders is a disruptive, digitally native business model, founded on the principle of providing high quality lifestyle and active eyewear, at affordable prices and with engaging brand content. A strong proposition rooted in a rapid expansion of brand awareness among its natural, fast growing customer audience of Millennials and Generation Z. Blenders is entrenched in today’s social sphere and is experiencing significant social media success.

With Blenders, we aim to foster and accelerate our e-commerce and omni-channel strategy, leveraging on the digital DNA and proven capabilities of the brand and putting Safilo’s global capabilities at its disposal to enable global expansion of the brand.”

Chase Fisher, founder and CEO of Blenders Eyewear commented: “This marks a huge step forward for Blenders and we’re excited to be part of Safilo to reach a wider marketplace. Safilo’s product know-how and global distribution capabilities are the perfect complement to our digitally native business model, opening up worldwide expansion potential. We’re on a mission to build a thriving global community that inspires people to live in forward motion.”

Safilo acquired today the 70% controlling interest in the Company, based on a total value on a cash-and-debt free basis (Enterprise Value for 100% of the Company) equal to USD 90 million. The cash consideration to be paid at closing is subject to customary price adjustments. The closing of the transaction is subject to conditions precedent including some related to the activities of the Company.

Chase Fisher will retain full ownership of 30% of the shares and, pursuant to the share purchase agreement, these remaining equity interests are subject to customary reciprocal put and call options which can be exercised starting from 2023. Chase Fisher will remain CEO of Blenders Eyewear which will continue to run out of its San Diego home.

The acquisition will be financed through available cash and credit facilities, and through a loan provided by Safilo’s reference shareholder, Multibrands Italy B.V., controlled by HAL Holding N.V, for an amount of EUR 30 million which the company aims to draw for the closing of the transaction.

The transaction executed with Multibrands Italy B.V. represents a “transaction with a related party of greater importance” as the Equivalent-value relevance ratio (i.e. the ratio between the counter value of the loan and the consolidated shareholders’ equity as at June 30, 2019) is above the threshold of 5%.

As such, the execution of the loan has been approved by the Board of Directors on December 1^st, 2019 upon the favourable opinion of the Related Parties Committee dated November 29^th, 2019, on the interest of the Group in entering the loan and on the convenience and substantial fairness of the relevant terms and conditions.

The required informative document will be made available within the timeframe provided for by the law.

The effects of the acquisition will be reflected in the new Business Plan that Safilo will disclose to the market on December 11, 2019.

About Safilo Group

Safilo Group is a worldwide leader in the design, manufacturing and distribution of sunglasses, optical frames, sports eyewear and products. Thanks to strong craftsmanship expertise dating back to 1878, Safilo translates its design projects into high-quality products created according to the Italian tradition. With an extensive wholly owned network of subsidiaries in 40 countries – in North and Latin America, Europe, Middle East and Africa, and Asia Pacific and China – and more than 50 distribution partners in key markets, Safilo is committed to quality distribution of its products in nearly 100,000 selected points of sale all over the world. Safilo’s portfolio encompasses: own core brands Carrera, Polaroid, Smith, Safilo, Oxydo, and licensed brands: Dior, Dior Homme, Fendi, Banana Republic, BOSS, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara, Max&Co., Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.

Listed on the Italian Stock Exchange (ISIN code IT0004604762, Bloomberg SFL.IM, Reuters SFLG.MI), in 2018 Safilo recorded net revenues for Euro 962.9 million.

About Blenders Eyewear

Blenders Eyewear was founded in 2012 by Chase Fisher in San Diego, Calif., Blenders produces a wide range of men’s and women’s sunglasses and snow goggles. Driven by a company-wide motto of “life in forward motion,” its products are predicated upon a bold aesthetic that emphasizes progressive colorways aimed at an active lifestyle demographic. Now a talented team of spunky and spirited designers, photographers, and communicators, Blenders is one of America’s fastest-growing sunglasses brands. For more information, visit www.BlendersEyewear.com.

Contacts:

Safilo Group Investor Relations

Barbara Ferrante

Ph. +39 049 6985766

http://investors-en.safilogroup.com

Safilo Group Press Office

Antonella Leoni

Milan – Ph. +39 02 77807607

Padua – Ph. +39 049 6986021

Blenders Eyewear Media Contact

Brooke Brumfield

Brooke@fiorpartners.com

Ph. +1 530 414 6259