ID Logistics : Financial report H1 2023

Half-year financial report

______

June 30, 2023

This translation is only for the convenience of English-speaking readers. Only the French text has legal value.

ID LOGISTICS GROUP

A French corporation (société anonyme) with capital stock of €3,086,664.00

Head office: 55 chemin des Engrenauds, 13660 Orgon, France. TARASCON TRADE AND COMPANIES REGISTER NO. 439 418 922

Table of contents

1	PERSON RESPONSIBLE	3
	1.1 PERSON RESPONSIBLE FOR THE HALF-YEAR FINANCIAL REPORT	3
	1.2 STATEMENT OF THE PERSON RESPONSIBLE FOR THE DOCUMENT	3
2	HALF-YEAR BUSINESS REPORT	4
3	CONDENSED FINANCIAL STATEMENTS	10
4	STATUTORY AUDITORS' REPORT	22

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• PERSON RESPONSIBLE

1.1 PERSON RESPONSIBLE FOR THE HALF-YEAR FINANCIAL REPORT

Mr. Eric Hémar, Chairman and CEO of ID Logistics Group.

1.2 STATEMENT OF THE PERSON RESPONSIBLE FOR THE DOCUMENT

I hereby certify that, to the best of my knowledge, the condensed consolidated financial statements for the six months ended June 30, 2023 were prepared in accordance with applicable accounting standards and give a fair view of the Company's assets and liabilities, financial position and earnings, as well as those of all of its consolidated companies. I also certify that the attached half-year business report presents a fair statement of key events that occurred during the first six months of the year, the impact thereof on the financial statements and the main related party transactions, as well as a description of the main risks and uncertainties to be faced during the remaining six months of the year.

Orgon, September 15, 2023

Eric Hémar

Chairman and CEO

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• HALF-YEARBUSINESS REPORT

The reader is invited to read the following information concerning the Group's financial position and earnings in conjunction with the condensed consolidated financial statements for the six months ended June 30, 2023 as set out in Chapter 3 "Condensed financial statements" of the half-year financial report.

Given that the figures stated in euro millions in the tables and analyses in this chapter have been rounded, the totals shown do not necessarily equal the sum of the individual rounded figures. Similarly, the sum of the percentages that are based on the rounded figures does not necessarily equal 100%.

In addition to the financial indicators directly presented in the consolidated financial statements, the Group uses a number of alternative performance indicators:

• Like-for-likechange in revenues: this reflects the Group's organic growth, excluding the impact of:

• • changes in consolidation scope: the contribution to revenues of companies acquired during the period and companies sold during the previous period is excluded;
  • changes in the applicable accounting principles;
  • changes in exchange rates, by calculating revenues for the various periods on the basis of identical exchange rates: published data for the previous period is converted using the exchange rate for the current period.
• Underlying EBITDA: underlying operating income (EBIT) before net depreciation, amortization and impairment of PP&E and intangible assets
• Net borrowings: gross borrowings plus bank overdrafts less cash and cash equivalents
• Net debt: net borrowings plus lease liabilities recognized in application of IFRS 16 - Leases

2.1 First half 2023 highlights

• The Group ceased operating in Russia in early January 2023. The comparative information in the consolidated income statement and consolidated statement of cash flows presented in this document has been restated to reflect the classification of ID Logistics Russia under discontinued operations in accordance with IFRS 5 - Non-current assets held for sale and discontinued operations.
• On March 13, 2023, the Group contracted a new loan for €200 million, repayable over four years and maturing in February 2027. On March 15, 2023, this loan was used to fully repay the €202 million bridge loan maturing on August 16, 2023.
• On May 31, 2023, the Group completed the acquisition of a 100% equity stake in Polish-based Spedimex. Founded in 1993, Spedimex is a leading Polish contract logistics operator with recognized expertise in the fashion and e-commerce sectors serving major international and Polish brands, as well as in cosmetics. In addition to contract logistics, Spedimex boasts a solid distribution and transport network and offers value-added logistics services and retail order picking. Spedimex has developed an asset-light model and operates 15 sites across the country spanning a total area of 230,000 sqm. The company has implemented sophisticated automation and technology solutions capable of managing large complex flows, such as e- commerce and store returns covering over 15 European countries for a single customer. Over the past few years, Spedimex has significantly grown its revenues to reach PLN 510 million in 2022. The transaction was paid in cash in the amount of €23.5 million plus the equivalent of €53.9 million in new ID Logistics Group shares issued to Spedimex's former main shareholder and Chairman and CEO.
• On May 31, 2023, Eric Hémar, Chairman and CEO of the ID Logistics group, transferred his 5.0% stake in the Ficopar sub- holding company to ID Logistics Group via Immod, a company he controls, in exchange for new shares. After this streamlining of the legal structure, ID Logistics Group now holds 100% of its sub-holding company Ficopar.
• ID Logistics set up operations in the United Kingdom, making it the 18th country in which ID Logistics operates. The operation was set up following the Spedimex acquisition in response to a major fashion customer's decision to entrust ID Logistics with the management of e-commerce and store returns from the UK region. The new business activity was launched in June 2023 from an 18,000 sqm warehouse employing 250 people in Northampton, England.

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2.2 Consolidated income statement

€m	H1 2023	H1 2022
Revenues	1,288.6	1,168.4
Purchases and external charges	(626.8)	(596.0)
Staff costs	(462.7)	(401.2)
Miscellaneous taxes	(11.5)	(11.5)
Other underlying income (expenses)	1.5	0.5
Net (increases) write-backs to provisions	3.3	3.4
Underlying EBITDA	192.4	163.7
Net depreciation/impairment	(144.5)	(121.5)
EBIT before amortization of acquired customer relations	47.9	42.2
Amortization of acquired customer relations	(2.3)	(1.7)
Non-recurring expenses	-	(2.2)
Net financial items	(21.6)	(10.2)
Corporate income tax	(6.7)	(8.3)
Share of earnings of equity affiliates	0.6	0.7
Net income from continuing operations	17.9	20.4
Net income/(loss) from discontinued operations	0.4	(0.2)
Total consolidated net income	18.3	20.2
Minority interests	1.9	1.9
Group share	16.4	18.3

ID Logistics posted H1 2023 revenues of €1,288.6 million, up 10.3%. This performance incorporates changes in consolidation resulting from the acquisitions of Kane Logistics in the United States (consolidated since April 1, 2022) and Spedimex in Poland (consolidated since June 1, 2023), as well as currency losses over the period. Restated for these effects, first half like-for-like revenue growth came to 4.3%.

In accordance with the definition of alternative performance indicators set out above, the reconciliation between reported and like-for-like revenue data is as follows:

€m	H1	Impact of	Impact of	Impact of	Like-for-like	H1
change in	change in	application of
	2022	change	2023
	consolidation	exchange rates	IAS 29
Revenues	1,168.4	+7.0%	-1.1%	+0.1%	+4.3%	1,288.6
Revenues break down as follows:
€m			H1 2023	H1 2022
International			877.3	745.5
France			411.3	422.9
Total revenues			1,288.6	1,168.4

• International revenues for the first half rose sharply by 17.7% to €877.3 million. As mentioned above, this includes three months of consolidation for Kane Logistics (company acquired in the United States on March 31, 2022) and one month for Spedimex (company acquired in Poland on May 31, 2023). Adjusted for these changes in consolidation scope and first half currency losses, growth was still strong, up 8.3% like-for-like versus H1 2022, a period of strong growth at 21.9%.
• In France, ID Logistics posted H1 2023 revenues of €411.3 million, down 2.7% impacted by the non-renewal of contracts in application of a rigorous and selective risk management policy and a decline in consumption volumes, particularly in the DIY, furniture and decoration sectors, only partly offset by higher prices.

First half 2023 purchases and external charges amounted to €626.8 million, up from €596.0 million in first half 2022 but down from 51.0% to 48.6% as a percentage of revenues. This relative decrease is mainly due to reduced use of temporary staff and other subcontracting services in accordance with the policy of adjusting costs to consumption volumes.

First half 2023 staff costs amounted to €462.7 million, up from €401.2 million in H1 2022. As a percentage of revenues, staff costs rose from 34.3% in H1 2022 to 35.9% in H1 2023. This relative increase is the result of the relative decrease in purchases and external charges mentioned above.

Miscellaneous taxes amounted to 0.9% of revenues, as in 2022.

As in first half 2022, other income and expenses netted out close to zero for the first half of 2023.

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