VERSIONE 1

H1-2022
Results Presentation

Milan, July 28th 2022
1

July 28th 2022

AgendaPatrizio Bertelli – CEOBusiness Update
Lorenzo Bertelli – Marketing Director and Head of CSR
Key Marketing and ESG Initiatives
Andrea Bonini – CFO
H1-22 Financial Review
Paolo Zannoni – Executive Chairman
Concluding Remarks
Q&A Session

2

July 28th 2022

Highlights

Strong semester underpinned by strategic delivery and brand momentum

H1-22 Net Revenuesof €1.9 bln,
+27% reported+22% constant fx

H1-22 Retail Salesof €1.7 bln,
+31% reported+26% constant fx

Gross Marginof 77.7%

EBIT Adj.
Margin of 17.4%

Significant progressagainst strategy

Continued
investments increativity, industrial
know-how andinfrastructure

Operationalimprovements driving
revenue growth andprofitability

Implemented
new steps toachieve ESG targets

Currently on accelerated trajectory to achieve strategic KPIs laid out at 2021 Capital Markets Day

3July 28th 2022

AgendaPatrizio Bertelli – CEOBusiness Update
Lorenzo Bertelli – Marketing Director and Head of CSR
Key Marketing and ESG Initiatives
Andrea Bonini – CFO
H1-22 Financial Review
Paolo Zannoni – Executive Chairman
Concluding Remarks
Q&A Session

4July 28th 2022

H1-22 Strategic Progress (1/2)
Accelerated delivery of our strategy

Prada Group’s
Distinctive Vision

Style, Quality,
And Unique Products• Unconventional perspectives
on luxury• All categories up double digit –acceleration in Leather Goods• Sustained top line growth driven
by healthy like-for-like increase• High demand brands• Further enriched collections andmultiple price points• Ongoing investment in restyling,
pop-ups and selective new openings• Exclusive NFT drops build
momentum and excitement• Omni-channel approach delivers
further enhanced customer journey• Strong dialogues continue tofoster group audiences

5Focus on
Direct Distribution

July 28th 2022

H1-22 Strategic Progress (2/2)
Accelerated delivery of our strategy

Industrial Know-Howand Vertical Integration

ESG is aLong-Term Value Driver

Investment in People andTechnology infrastructure• Supply chain optimisationin progress• Robust contribution of ESG
committee• Continued investment in people
and tech infrastructure• Process control and productexcellence• Focused on setting ambitious key
targets to deliver further progressby the end of the year

• Creatively approached Web3

• Further investments invertical integration

6July 28th 2022

Financial Highlights

Strategic progress delivered strong financial results• Achieved Net Revenues of €1.9 bln (+22% at constant fx)• Strong performance across direct channels in line with strategy- Further retail acceleration (+26% vs. H1-21 and +38% vs. H1-19)- Continued strength online- Retail contribution ~ 90%• Strong performance across all product categories and countries
excluding China / Russia• Gross Margin of 77.7%• Healthy and sustained top line growth delivered material margin
expansion:- EBIT Adj.(*) to €331 mln, 17.4% Margin, vs. H1-21 Margin of 11.1%• ~ 60 store renovation projects in H1-22• Strong balance sheet with Net Cash of €179 mln(*) EBIT Adjusted excludes Other non-recurring income and expenses (for the six months ended June 30, 2022, €26 mln write-down of non-current assets in Russia)

7

July 28th 2022

Operational priorities for H2-22
Continue long term strategy for growth• Product-

Further enriched-

Strong brand connotation-

Continued focus on Leather Goods-Launch of Jewellery• Continued investment in direct distribution-

Further step-up of store renovation plan-

Selective new openings-Omni-channel• Cost and capital allocation discipline• Further investment in vertical integration

8

July 28th 2022

AgendaPatrizio Bertelli – CEOBusiness Update
Lorenzo Bertelli – Marketing Director and Head of CSR
Key Marketing and ESG Initiatives
Andrea Bonini – CFO
H1-22 Financial Review
Paolo Zannoni – Executive Chairman
Concluding Remarks
Q&A Session

9

July 28th 2022

Prada Group – tailored approach to brand marketing
Relentless customer focus driving performance• Investing in ideas: optimising marketing processes andimplementing new ideas to challenge them
• Re-inventing the existing: focusing on a clear brandand customer DNA• Balance between iconic and new formats: the identityof each brand articulates in projects and formats that
become part of the brand equity itself• Empowering the community: creating new engaging
dialogues with our audiences, balancing growthacross customer age groups - strong traction withGEN Y and GEN Z10July 28th 2022

Prada: Strong sustained brand momentum
Successful balance of new and iconic formats

Increased interest incollections co-createdby Miuccia Prada andRaf SimonsContinued talent
relevance in Prada Men’s
advertising campaign• Prada Men’s SS23
Mentions: 3.5 mln(+43k% vs. SS22)• FW22 advertising
campaign featuring
Jeff Goldblum,Damson Idris andRami Malek• #1 in terms ofMentions in a panelof competitors
between Paris andMilan fashion weeks

Key events drive
brand visibility• Prada celebrated
Miuccia Prada’s
collaboration for thedesign of Baz
Luhrmann’s Elvis movie
costumes• Elvis cast attended theMet Gala in Prada

Crossing new
boundaries withLinea Rossa

Successful approachto Web3• Nikolas Plytas
wakeboarding 5.6 mln
views on IG• Prada Time Capsule NFT:

• Pierre Vaultiersnowboarding 2.9 mln
views on IG- First Drop sold out
in a few minutes(June 2022)- Second Dropconfirms highdemand combinedwith NFTs (July 2022)• Prada with Meta for thelaunch of its Avatar store

Source: Sprinklr

11

July 28th 2022

Miu Miu: Enhanced brand awareness and desirability
A clear identity and strong brand resonance

FW22 Miu Miu fashion show
continues to expand thebrand’s territories

Upcycled by Miu Miu• Live streaming +31% vs. FW21•

50 unique embellishedvintage jackets•Giving new life to pre-owned
and pre-loved clothing

Artistic Collaboration withNathalie Djurberg and Hans
Berg for the set up and ajewellery capsule collection•

Third episode presented
during FW22 fashion show

12

Miu Wander bag campaign
featuring Sydney Sweeney•

A rediscovery of the codes
and the identity of Miu Miu,
through a new perspective•

9.2 mln engagement and401.7 mln reach

July 28th 2022

Clear brand heat

Excellent results confirmed

Prada.com
website traffic1

Share of Searcheffectiveness2

Among thehottest brands+34%

miumiu.com
website traffic1visits
H1-22 vs H1-21

Share of Searcheffectiveness2

H1-22 vs H1-21

3Climbsthe ranking

2+26%
H1-22 vs H1-21#7

Q2-22 Lyst index
from #10 in Q1-22

Q2-22 Lyst Index
from #4 in Q1-22
1visits
H1-22 vs H1-21+26%
Top+33%

Source Adobe Analytics
Source Adobe Analytics - Growth of search traffic to website, including natural and paid search (not limited to Google)13

July 28th 2022

ESG is a long term value driver
Concrete actions and progress

Governance• Sustainability Committee
fully running• Operational Committee
established to speed up
ESG integration• Approved short-term
action plan to improve
ESG performances

ClimateStrategy

Materials
Innovation• Implemented set of
initiatives to meet
reduction target for
Scope 1 & 2 GHG
emissions (*), whilecarbon neutral for Scope
1&2• New strategic partnershipwith Leather Working
Group (LWG)• Started internal project for
the traceability of leatherprocurement• Identified long-term
initiatives to meet
reduction target for
Scope 3 GHG emissions

People• Sea Beyond educational
program (VR experienceon global scale + Lisbonevent)• Launch of internal survey
on DE&I (**)• Company-wide
sustainability training(**) Diversity, Equity and Inclusion(*) Green house gases

Next focus• Biodiversity and water resources management

14

July 28th 2022

AgendaPatrizio Bertelli – CEOBusiness Update
Lorenzo Bertelli – Marketing Director and Head of CSR
Key Marketing and ESG Initiatives
Andrea Bonini – CFO
H1-22 Financial Review
Paolo Zannoni – Executive Chairman
Concluding Remarks
Q&A Session

15

July 28th 2022

Key Financials Summary

Strong growth and profitability acceleration
H1-22 Net Revenues€1,901 mln (+22% vs. 21 / +22% vs. 19) *H1-22 EBIT Adj.
€331 mln *H1-22 Net Operating Cash Flow *€158 mln

Retail Sales (€ mln) and growth (%) *EBIT / EBIT Adj. (€ mln) and margin (%)

Net Financial Position (€ mln) **

17.4%
Adj.

+38%
+26%

1.678
1.678

11.1%

9.6%

331

1.281

1.232

16.0%

179
305
166

150-102-406
H1-19//(*) at constant fx (%)

H1-21H1-22
H1-22

H1-19//

H1-21

H1-22

(*) EBIT Adjusted excludes Other non-recurringincome and expenses

FY-19//

H1-21

H1-22

(*) Net cash flow from operating activities, lessrepayment of lease liabilities(**) (Net debt) / Net Cash position

16

July 28th 2022

Net sales by Channel

Outstanding retail performance – highly controlled wholesale€ mln% at constant fx

H1-22

H1-22 vs.
H1-21

H1-22 vs.
H1-19

Retail

1,678

+26%

+38%

Wholesale194-3%-39%

Total

1,872

+22%

+22%

Wholesale
9%
DFS
1%

Retail90%Retail• Strong retail performance driven by healthy like-for-like increase• Q1 and Q2 saw a sequential acceleration on a 3-year stack basis• Online sales up robust double-digit yoy throughout the periodWholesale• Selective approach to traditional wholesale and e-tailers

17

July 28th 2022

Retail sales by Geography

Strong growth despite Mainland China lockdowns€ mln% at constant fx

H1-22

H1-22 vs.
H1-21

H1-22 vs.
H1-19

Asia Pacific

590

-7%

+26%

Europe486

+89%

+34%

Americas

360

+41%

+116%

Japan

161+28%-3%

Middle East

80+24%+59%

Total

1,678

+26%

+38%

Middle East
5%

Japan
10%

APAC
35%

Americas21%

Europe29%• Asia Pacific impacted by lockdowns in Mainland China from mid-March; remarkable strength in other regions- ~ 30% of the Chinese retail network impacted in Q2-22; improvement in June
- Strong performance in Korea and South East Asia throughout the semester• Outstanding performance in Europe, notwithstanding tough comparisons to Q2-21 and Russia impact- Sharp growth across the region driven by domestic sales and tourist flows in Q2-22• Strong growth in the Americas across US, Canada and Latin America- Triple digit growth on a 3-year stack• Accelerating trend yoy in Japan in Q2-22; robust performance in the Middle East
18

July 28th 2022

Retail sales by Product

Strong performance across all categories€ mln% at constant fx

H1-22

H1-22 vs.
H1-21

H1-22 vs.
H1-19

Leather Goods

856+18%+24%

Ready to Wear

461

+32%

+65%

Footwear

320+39%Other2%
Shoes
19%

Leather Goods
51%

+46%

Other

41+86%

+45%

Total

1,678

+26%+38%•

Leather Goods- Acceleration driven by new and iconic lines- Balanced growth across bags, accessories and gender- Richer collections across multiple price points•RTW- Continued strength with clear design leadership- Highly appreciated new collections across Prada and Miu Miu•Footwear- Sharp growth driven by lifestyle and new collections

19RTW
27%

July 28th 2022

Retail sales by Brand

Outperformance of Prada - Continued improvement at Miu Miu€ mln% at constant fx

H1-22

H1-22 vs.
H1-21

H1-22 vs.
H1-19

Prada

1,457

+28%+46%

Miu Miu

196+14%+5%

Church’s

14+29%-39%

Other (*)

10+87%+27%

Total

1,678+26%+38%

Church's1%

Other1%

Miu Miu
12%

Prada
87%

(*) includes Marchesi and Car Shoe

•

Prada
- Outstanding performance across all product categories- Solid range comprising new products and iconic carryover- Balanced growth across customer gender and age groups•Miu Miu- Turned positive on a 3-year stack- Growing visibility thanks to impactful communication strategy and acclaimed SS fashion show
- Very successful introductions of new products delivers positive performance across all categories yoy•

Church’s- Encouraging trend despite ongoing headwinds in category
20July 28th 2022Gross margin development

Significant improvement driven by multiple factors+340 bps

2.8%

+0.6%

77.7%

Avg priceFX

H1-22

74.3%

H1-21

ChannelLogistics costs

21

July 28th 2022

Operating costs

OPEX decline as a % of Net Revenues by ~ 3 p.p.
€ mln••

Operating costs (*)

H1-21% on Net
Revenues

H1-22% on Net
Revenues

H1-22 vs. H121

Selling

651

43.4%

796

41.8%

+22%

Advertising & Promotion

127

8.5%

155

8.2%

+22%

Design and ProductDevelopment

64

4.2%

69

3.6%

+8%

G&A

107

7.1%

127

6.7%

+19%

Total

949

63.2%

1,147

60.3%

+21%

EBIT Adj.

166

11.1%

331

17.4%

+99%

OPEX increase (+21% reported, +17% at constant fx) mainly driven by variable component, decrease in
COVID contributions, higher discretionary A&P spend, higher labour costs and normalisation of businessactivities post pandemic
EBIT Adj. up by 99%, a 630 basis points yoy improvement to 17.4%(*) Excludes Other non-recurring income and expenses

22

July 28th 2022

CapexContinued investments in Retail, IT and Industrial

97€ mlnCorporate,
IT & Industrial

753514Retail•
•
•

6162

HH1-21
1 -2 1H1-22
H
1 -2 2~ 60 renovation and relocation projects
8 net closures (7 openings and 15 closures) / 627 DOS end of June 2022
€18 mln industrial Capex and €12 mln IT Capex
23

July 28th 2022

Net Operating Working Capital
Remains flat as a % of sales

680

602

318

330
€ mln
Trade Receivables
Inventory

731

663

Trade Payables% of Net Sales-390-370

FY-21

H1-22

FY-2 1H 1 -2 2

18%

18%

24

July 28th 2022

Net Financial Position

Strong balance sheet with Net Cash of €179 mln€ mln

Opening Net financial position surplus / (deficit) - 31/12/2021

238

Consolidated Net Result

189

Net Working Capital-71

Depreciation and Amortization+131

Capital expenditures and Investments-93

Dividends

-170

Other

-44

Closing Net financial position surplus / (deficit) - 30/06/2022

179

25

July 28th 2022

AgendaPatrizio Bertelli – CEOBusiness Update
Lorenzo Bertelli – Marketing Director and Head of CSR
Key Marketing and ESG Initiatives
Andrea Bonini – CFO
H1-22 Financial Review
Paolo Zannoni – Executive Chairman
Concluding Remarks
Q&A Session

26

July 28th 2022

Concluding remarks

Confident on ability to achieve medium-term targets despite macro uncertainty•

Decisive action taken to evolve the business
continues to deliver financial and operationalstrength•

Despite highly uncertain global macro
environment, current trading remains strong•

H1-22 results accelerated the Group’s
trajectory towards the mid-term targets•

Several external factors could influence ourperformance and we are vigilant, ready to react•

Focus on balancing margin improvement andinvestment in: people, retail network,
technological and manufacturing infrastructure,omni-channel capabilities and sustainability

jpg

27

July 28th 2022

Q&A SESSION

28

July 28th 2022

APPENDIX

29

July 28th 2022

Condensed P&L
€m

H1-19

H1-21

H1 22

Net Revenues

1,570

100%

1,501

100%

1,901

100%

COGS

-444

-28.3%-386-25.7%-423-22.3%

Gross Profit

1,126

71.7%

1,115

74.3%

1,477

77.7%

Selling-707-45.0%-651-43.4%-796-41.8%

Advertising & Promotion

-101

-6.5%

-127

-8.5%

-155

-8.2%

Design and Product Development

-65

-4.1%

-64

-4.2%

-69

-3.6%

G&A-102-6.5%

-107

-7.1%

-127

-6.7%

Operating expenses-975-62.1%-949-63.2%-1,147-60.3%EBIT Adj.

150

9.6%

166

11.1%

331

17.4%

Non-recurring items

00.0%

00.0%

-26

-1.4%

EBIT

150

9.6%

166

11.1%

305

16.0%

Total Financial expenses

-30

-1.9%

-28

-1.8%

-27

-1.4%

EBT

120

7.7%

138

9.2%

277

14.6%

Income Taxes

34

2.2%

-41

-2.8%

-88

-4.6%

Minority Income

00.0%

00.0%

10.1%

Group Net income / (Loss)

155

9.9%

97

6.4%

188

9.9%

Total D&A

-340

-21.7%-312-20.8%

-352

18.5%

30

July 28th 2022

Condensed Balance Sheet€m31 Dec 2021

30 June 2022

Right of use

1,956

1,976

Non current assets (excl deferred tax assets)

2,490

2,500

Net operating working capital

602

680

Other current assets / (liabilities), net

-163

-155

Other non current assets / (liabilities), net

51

123

Net invested capital

4,936

5,123

Consolidated shareholders’ equity

3,129

3,243

Net financial position (surplus) / deficit

-238

-179

Long term lease liability

1,627

1,650

Short term lease liability

418

410

Total

4,936

5,123

Net operating cash flow

751

158

Net working Capital / Sales

18%

18%

Capex

217

97

negative

negative

Debt / Equity

31

July 28th 2022