F I L A Fabbrica Italiana Lapis ed Affini S p A : .I.L.A Group Hal-Year Report at June 30, 2022

Half-Year Report

June 30, 2022

F.I.L.A. GROUP

HALF-YEAR REPORT

AS AT AND FOR THE SIX MONTHS ENDED JUNE 30, 2022

F.I.L.A. - Fabbrica Italiana Lapis ed Affini S.p.A.

Via XXV Aprile 5 Pero (MI)

	Half-Year Report
	June 30, 2022
CONTENTS
I - General information ........................................................................................................................	4
Corporate Bodies ................................................................................................................................	4
Overview of the F.I.L.A. Group..........................................................................................................	5
Directors' Report ..................................................................................................................................	7
Key Financial Highlights ....................................................................................................................	7
F.I.L.A. Group's Financial Highlights ..............................................................................................	12
Adjusted financial performance ....................................................................................................	12
Business seasonality......................................................................................................................	14
Statement of Financial Position ....................................................................................................	15
Financial overview........................................................................................................................	18
Key events of the reporting period....................................................................................................	22
Events after the reporting period.......................................................................................................	24
Outlook .............................................................................................................................................	25
Treasury shares .................................................................................................................................	26
Related party transactions .................................................................................................................	27
Reconciliation between Parent and Group Equity ............................................................................	27

Condensed Interim Consolidated Financial Statements as at and for the six months ended June

30, 2022 ................................................................................................................................................	29
Interim Consolidated Financial Statements ......................................................................................	29
Statement of Financial Position ....................................................................................................	29
Statement of Comprehensive Income ...........................................................................................	30
Statement of changes in Equity.....................................................................................................	31
Statement of Cash Flows...............................................................................................................	32
Statement of financial position with indication of related party transactions pursuant to Consob
Resolution No. 15519 of July 27, 2006 ........................................................................................	34
Statement of Comprehensive Income with indication of related party transactions pursuant to
Consob Resolution No. 15519 of July 27, 2006 ...........................................................................	35
Notes to the condensed interim consolidated financial statements ...................................................	36
Segment reporting.............................................................................................................................	46
Business Segments - Statement of financial position...................................................................	47
Business Segments - Statement of comprehensive income..........................................................	48
Business Segments - Other Information.......................................................................................	49
Attachments ......................................................................................................................................	98
Attachment 1 - Related party transactions ....................................................................................	98
Attachment 2 - List of companies included in the consolidation scope and other investments ..	100
Attachment 3 - Business combinations .......................................................................................	101
Atypical and/or Unusual Transactions ............................................................................................	103
Statement of the Manager in Charge of financial reporting and the Corporate Bodies ..................	104
Report on review of condensed interim consolidated financial statements ....................................	105

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Half-Year Report

June 30, 2022

DIRECTORS' REPORT

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Half-Year Report

June 30, 2022

I - General information

Corporate Bodies

Board of Directors

Chairperson (*)	Giovanni Gorno Tempini
Honorary Chairperson	Alberto Candela
Chief Executive Officer (**)	Massimo Candela
Executive Director (**)	Luca Pelosin
Director	Annalisa Matilde Barbera
Director (*)	Giorgina Gallo
Director (*)	Carlo Paris
Director (*)	Donatella Sciuto

1. Independent director in accordance with Article 148 of the Consolidated Finance Act and Article 3 of the Code of Conduct. (**) Non-Executive Director.

Control, Risks and Related Parties Committee

	Donatella Sciuto
	Annalisa Matilde Barbera
	Carlo Paris
Remuneration Committee
	Carlo Paris
	Annalisa Matilde Barbera
	Giorgina Gallo
Board of Statutory Auditors
Chairperson	Gianfranco Consorti
Standing Auditor	Elena Spagnol
Standing Auditor	Pietro Michele Villa
Alternate Auditor	Stefano Amoroso
Alternate Auditor	Sonia Ferrero
Independent Auditors	KPMG S.p.A.

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Half-Year Report

June 30, 2022

Overview of the F.I.L.A. Group

The F.I.L.A. Group operates in the creativity tools market, producing and marketing colouring, design, modelling, writing and painting objects, such as pencils, crayons, modelling clay, chalk, oil colours, acrylics, watercolours, paints and paper for the fine arts, school and leisure.

The F.I.L.A. Group at June 30, 2022 operates through 22 production facilities and 35 subsidiaries across the globe and employs approx. 10,900 people, becoming a pinnacle for creative solutions in many countries with brands such as GIOTTO, DAS, LYRA, Canson, Maimeri, Daler-Rowney Lukas, Ticonderoga, Pacon, Strathmore, Princeton and Arches.

Founded in Florence in 1920 by two noble Tuscan families, della Gherardesca and Marchesi Antinori, F.I.L.A. S.p.A. (hereafter also the "Parent") has achieved strong international growth in the past 20 years, supported by a series of strategic acquisitions. Over the years, the Parent has acquired: (i) the Italian firm Adica Pongo in 1994, a leading producer of modelling clay for children; (ii) the Spanish firm Spanish Fila Hispania S.L. (formerly Papeleria Mediterranea S.L.) in 1997, the Group's former exclusive distributor in Spain; (iii) the French firm Omyacolor S.A. in 2000, a leading manufacturer of modelling putties and clays; (iv) the U.S. Dixon Ticonderoga Group in 2005, a leading producer and distributor of pencils in North America, with subsidiaries operating on the Canadian, Mexican, Chinese and European markets; (v) the German LYRA Group in 2008, which allowed the Group to enter the German, Scandinavian and Eastern Asian markets; (vi) the business unit operated by Lapiceria Mexicana in 2010, one of the main local competitors in the budget coloured and graphite pencils market; and (vii) the business unit operated by Maimeri S.p.A. in 2014, a manufacturer and distributor of paints and accessories for arts and crafts. In addition to these operations, on the conclusion of an initiative which began with the acquisition of a significant influence in 2011, control of the Indian company DOMS Industries Pvt Ltd. was acquired in 2015 (viii). In 2016, the F.I.L.A. Group focused upon development through strategic Art&Craft sector acquisitions, seeking to become the leading market player. On February 3, 2016, F.I.L.A. S.p.A. acquired control of the Daler-Rowney Lukas Group, an illustrious brand producing and distributing materials and accessories on the arts and crafts market since 1783, with a direct presence in the United Kingdom, the Dominican Republic, Germany and the USA (ix). In September 2016, the F.I.L.A. Group acquired the entire share capital of St. Cuthberts Holding Limited and the operating company St. Cuthberts Mill Limited, a highly-renowned English paper mill, founded in 1907, located in the south-west of England and involved in the production of high quality artist's papers (x). In October 2016, F.I.L.A. S.p.A. acquired the Canson Group, founded in 1557 by the Montgolfier family, with headquarters in Annonay in France, production facilities in France and conversion and distribution centres in Italy, France, China, Australia and Brazil. Canson products are

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