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Marzo 2014

9M 2015 Results

October 2015

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Operating structure

Note: The percentages of control are updated as of 30 September and are calculated net of treasury shares

€644 m €1.35 Bio €392 m

All Media sectors from

dailies and periodicals

to radio, Internet, and

advertising

Global automotive

components supplier

(filters, air &cooling and

suspensions)

Nursing homes,

rehabilitation and

hospital management

Private equity

Revenues

2014

Businesses

Competitive

position

Leader in circulation of Italian dailies

N.1 news magazine

N.1 Italian information website

Third Italian radio network

Leader in its core

businesses (filters and

suspensions) in

Europe and South

America

--

Leader in Italian long

term care (nursing

homes and

rehabilitation)

Non-core investments

56.4% 57.6% 51.3%

Total € 2.4 Bio

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• Founded in 1976 by Carlo De Benedetti; controlled (45.8%) by COFIDE-Gruppo

De Benedetti

• Long term investment strategy, with focus on controlling stakes

• Balanced portfolio of assets, with leading positions in their respective

businesses

• Active role in governance and in strategic decision making of portfolio

companies

• No leverage and significant liquidity available at holding company level

• Commitment to low cost structure

CIR Group profile

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• Consolidated net income: € 39.6 million (vs. € 5.4 million in 9M 2014).

Contribution of industrial businesses (Espresso, Sogefi and KOS) is + € 25.0

million, vs. € 4.4 million in 9M 2014

• Consolidated net financial position of the CIR Group at September 30, 2015:

- € 202.9 million (vs. - €112.8 million at December 31, 2014), including:

- A net financial surplus at holding level of €360.2 million (decreasing vs.

€379.5 million at December 31, 2014 due mainly to share buyback)

- A net debt of consolidated subsidiaries of - €563.1 million (increasing vs.

- €492.3 at December 31, 2014 due mainly to new investments and

KOS acquisitions)

9M 2015 consolidated financial highlights

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Consolidated income statement

Group net result 5.4 39.6

€ m

Income taxes (25.0) (25.9)

(41.4) Financial expense/income (6.7)

83.4

9M 2014 9M 2015

EBIT

EBITDA 154.4 174.4

96.7

Revenues 1,771.2 1,897.4

Loss on assets held for sale (5.3) (0.1)

(1) Restated following the application of IFRS5

(2)

(2) Net of third party interests (equal to €24.4 million in 9M 2015)

(1)

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Consolidated income statement by business sector

€ m

(2) Including Treasury and non core investments

9M 2014 9M 2015

CIR holding level 1.1 14.6

Net result 5.4 39.6

(2)

5.2 KOS Group 6.8

(3.3) Sogefi Group

Espresso Group 2.5 13.9

4.3

4.3 Total industrial companies 25.0 (1)

(1) Pro-rata share of subsidiaries’ net income

(0.1) Sorgenia Group --

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Consolidated balance sheet – main group assets

€ m

Group equity in consolidated balance sheet 31 Dec. 2014 30 Sept. 2015

129.5 KOS 133.4

95.1 Sogefi

Espresso 347.9 365.1

102.0

(2) Including SEG and other Education businesses; Cir Ventures; other minor

Fixed assets 18.1 17.8

572.5 Total industrial companies 600.5

Non performing Loans 49.3 43.8

Private equity 67.7 62.3

Other investments 33.9 33.1

Other assets/liabilities

Net cash

(16.5)

379.5

(11.7)

360.2

(1)

1,104.5 1,106.0 Consolidated shareholders’equity

532.0 Total CIR and non industrial companies 505.5

(1) Book value decreasing due to cash reimbursements to CIR

(2)

(1)

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Consolidated net financial position

€ m

31 Dec. 2014 30 Sept. 2015

(157.0) KOS Group (218.3)

(304.3)

CIR holding level 379.5 360.2

Sogefi Group

Espresso Group (34.2) (8.1)

(339.7)

(492.3) Total subsidiaries (563.1)

Consolidated net financial indebtedness (112.8) (202.9)

3.2 Other subsidiaries 3.0

Total shareholders’ equity 1,573.2 1,591.6

Consolidated net invested capital 1,686.0 1,794.5

(1) Including third party interests

(1)

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• Decrease of net cash at holding system level is mainly due to purchases of

treasury shares

Net financial position at “holding system” level

Evolution of net financial position as at 30 September 2015

(1)

(1) Fair value of securities + securities income, trading

(2) Operating costs, extraordinary costs, taxes, etc.

(2)

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Composition of liquid assets and gross financial debt

Liquid assets at 30 September 2015

€ m

Hedge funds

Other (stocks, equity funds)

382.1

96.0

95.1

30.1

360.5

45.8

11.3

31 Dec.

2014

30 Sept.

2015

Cash and time deposits

Corporate bonds

Government bonds

57.9

5.7

59.2

43.2

4.2

99.3

Total liquid assets

31 Dec.

2014

30 Sept.

2015

2.6 0.3 Gross financial debt

Other debt 2.6 0.3

Fixed income funds 94.0 196.8

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9M 2015 Subsidiaries’ financial and operational highlights

Key strategic objectives 9M 2015 Highlights

Expansion of digital platforms, leveraging on

leadership in traditional media

Further efficiency improvement

Further consolidation in Italian nursing and

rehabilitation

Geographical expansion (India)

Completion of global footprint, through growth in

non-European countries

Further efficiency improvement and restructuring of

manufacturing footprint

Product innovation

Decrease of press circulation (-5.6%) and total advertising revenues (-4.4%), although at lower rates than the market; internet (+2.8%) and radio (+6.1%) advertising showed positive dynamics.

In such challenging market, Espresso reported positive net results and stable EBITDA, thanks to continuing focus on efficiency improvement, and decreasing net debt (€8.1 m vs. €34.2m at 4Q2014), thanks to operating cash flow and divestiture of TV assets.

La Repubblica and Repubblica.it confirm their leadership respectively in daily newspaper newsstand sales/readership and news sites unique users rankings

Espresso

Sogefi

KOS

Selective growth in emerging industry sectors, with

international focus Non-core

investments

Positive performance of Education business

Continuing growth of revenues (+12.6%) and EBITDA (+20.8%) thanks

to ongoing organic and external growth

Revenues growth of 11.5% (+8.7% at constant exchange rates):

- Positive performance in Europe (+9.3%); double digit growth in North

America (+23.2%) and Asia (+31.1%);

- Slight decrease in Latin America (-0.7%) despite market slowdown

Improving EBITDA (+13.1%) and +7.4m net income (vs. -5,8m loss in

9M2014), thanks to higher volumes, lower restructuring costs and lower

financial expenses

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Espresso - overview

9M 2015 Revenues breakdown

NATIONAL PRESS

DIGITAL

ADVERTISING

National daily newspaper

18 Regional newspapers throughout Italy

Group websites

Three national radio stations

LOCAL

NEWSPAPERS

RADIO

Collection of advertising

€ m

9M 2014 9M 2015

Revenues 465.8 439.6

Net income 4.6 24.6

EBITDA 41.8 40.9

Key financials Operating structure

9M 2015 Performance and outlook

• Circulation revenues at € 166.0 million, decreasing by 5.6%, in a

market down 9.4%. Total advertising revenues were down 4.4%:

radio and the internet grew respectively by 6.1% and 2.8% while

printed press was in line with the negative trend of the market

• EBITDA was in line with last year as a result of continuing action

on costs, which were reduced by 6.6%, more than revenue

contraction

• Increase in net income was due not only to the capital gain of €

9.5 million related to the sale of Deejay TV to Discovery Italy but

also to the results of the core business, to the reorganization of

the television business and to lower financial expenses and tax

charges

• As for the FY 2015 outlook, performance of Espresso’s media is

expected to be less negative than that of the overall advertising

market and net result is expected to be better than previous year

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Sogefi - overview

Revenues 1,010.2 1,126.6

Net result (5.8) 7.4

EBITDA 80.8 91.3

Key financials € m

9M 2014 9M 2015

• 11.5% revenues growth (+8.7% at constant exchange

rates), due to higher volumes in all geographical areas,

with the exception of Latin America. Revenues grew by

9.3% in Europe, by 23.2% in North America, by 31.1% in

Asia; -0.7% in South America

• Net income benefited from higher volumes and decrease

of net financial expenses

• For the rest of 2015 Sogefi expects to continue on

positive trends in North America and Europe; further

growth is expected in China and India, while in South

America market conditions remain difficult

9M 2015 Performance and outlook

FORD

FCA

RENAULT/NISSAN

PSA

DAIMLER

GM

VOLKSWAGEN/AUDI

BMW

TOYOTA

Revenues breakdown (9M 2015)

OTHERS (including

Aftermarket)

13.1% 12.0%

11.3%

11.8%

7.7% 7.4%

3.4%

2.8%

2.1%

28.2%

Europe

North America

South America

63.7%

17.0%

12.0%

7.0% 0.3%

Weight of non-

European

markets

36.3%

Countries Customers

Asia Others

SUSPENSIONS FILTRATION AIR & COOLING

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KOS - overview

€ m 2011 2012

Revenues 289.7 326.3

Net income 10.1 13.3

EBITDA 44.2 53.4

Key financials

SHAREHOLDERS

HOSPITAL

MANAGEMENT NURSING HOMES REHABILITATION

CIR (51.3%)

ARDIAN (46.7%)

Management and others (2.0%)

Operating structure

9M 2014 9M 2015

5.2

2.3

5.7

10.2

36.6

114.3 7.6 23.5

45.4

107.1

18.8

Revenues breakdown by region (2014)

4.5

• Increase in revenues (+12.6%), thanks to relevant acquisitions

in the nursing home/rehabilitation area and to organic growth

across all businesses lines.

• Contributions to EBITDA increase were:

- €1.5 million from revenue growth and efficiency

improvement, at constant 2013 perimeter

- €7.7 million from 2014 and 2015 acquisitions and

greenfields

• In October 2015 a new nursing home was started in Turin

• The company now has 77 nursing homes in the centre and

north of Italy with more than 7,300 beds

• Main objectives are to pursue market consolidation in core

businesses and to selectively expand internationally, with a

primary focus on India

9M 2015 Performance and outlook

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• Education

- CIR has an interest of 17.4% in SEG (Swiss Education Group), a world

leader in education for hospitality management (hotels, restaurants, etc.).

The book value of the investment at 30 September, 2015 was €22.0 million

- On 26 October, 2015 CIR signed an agreement with a group of investors

concerning the sale of its 17.4% shareholding in SEG, for a total

consideration of € 64.1 million, a capital gain on investment of € 45,5 million,

and an IRR of 30%. The closing of the deal is expected by end November

• Private equity

- Diversified portfolio of private equity funds and direct minority private equity

investments, with a fair value of € 62.3 million at 30 September, 2015. The

portfolio has reached its maturity/reimbursement phase, as limited

investments were added in the recent past

• NPL

- At the end of September 2015 the net value of CIR investment in the non-

performing loan portfolios amounted to €43.8 million.

- CIR no longer owns operating companies in this industry and is currently in

the process of collecting the existing receivables, with no further investments

Non-core investments

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• This document has been prepared by CIR for information purposes only and for use

in presentations of the Group’s results and strategies.

• For further details on CIR and its Group, reference should be made to publicly

available information, including the Annual Report, the Semi-Annual and Quarterly

Reports

• Statements contained in this document, particularly the ones regarding any CIR

Group possible or assumed future performance, are or may be forward looking

statements and in this respect they involve some risks and uncertainties

• Any reference to past performance of CIR Group shall not be taken as an indication

of future performance

• This document does not constitute an offer or invitation to purchase or subscribe for

any shares and no part of it shall form the basis of or be relied upon in connection

with any contract or commitment whatsoever

Disclaimer

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