PRESS RELEASE

(Translation from the Italian original which remains the definitive version)

DRAFT 2019 FINANCIAL STATEMENTS

OUTLOOK FOR 2020

HEALTH EMERGENCY (CORONAVIRUS)

ANNUAL REPORT ON CORPORATE GOVERNANCE AND OWNERSHIP STRUCTURE

REMUNERATION REPORT

CONSOLIDATED NON-FINANCIAL STATEMENT

CALLING OF SHAREHOLDERS' MEETING

Cambiano, 23 March 2020- The Board of Directors of Pininfarina S.p.A., chaired by Silvio Pietro Angori, met today and approved the draft 2019 separate and consolidated financial statements, the annual report on corporate governance and ownership structure, the remuneration report and the consolidated non-financial statement and called the ordinary shareholders' meeting.

The 2019 and 2018 key financial figures of the Pininfarina Group are as follows:

(€'million)

Draft 2019

financial

2018

Variation

statements

Revenue

90.4

105.3

-14.9

EBITDA

-1.7

12.6

-14.3

EBIT

-19.4

3.8

-23.2

Net financial expense

-1.5

-2.4

0.9

Profit for the year

-23.1

2.2

-25.3

Net financial position (debt)

-12.0

5.2

-17.2

Equity

39.0

61.7

-22.7

EBITDA is the operating profit or loss gross of amortisation, depreciation, provisions, impairment losses, reversals of impairment losses and utilisation of provisions.

EBIT is the operating profit or loss.

Pursuant to article 154-bis.2 of the Consolidated Finance Act, the manager in charge of financial reporting, Gianfranco Albertini, states that the financial disclosures provided in this press release are consistent with the relevant documentation, ledgers and accounting records.

General considerations

With reference to the design and engineering activities in the automotive segment, as mentioned in previous financial reports, the group had signed important contracts with certain Asian customers for the production of electric cars. During the year, due to the macro-economic and political conditions of the country in which one of the customers operates, as well as delays in the progress of some contracts in the Chinese market, certain contracts were suspended, leading to a significant drop in revenue compared to 2018.

In general, the macro-economic situation of the automotive segment in 2019 was marked by a drop in global sales (estimated at 4% lower than 2018) and a resulting decrease in volumes and profits for the entire supply chain. Car manufacturers continued to invest heavily in new technologies (electric cars and ADAS), cutting back on cash flows earmarked for developing traditional vehicles. At the same time, many start-ups in the electric car segment struggled to raise the funds needed to develop new vehicles, thus forcing them to downsize their initial projects or abandon them completely.

Pininfarina's key markets - China, India and Germany - showed signs of a downswing compared to 2018 with regard to both GDP and the automotive segment in particular.

Due to the segment's instability, there was severe pressure on prices - especially in the second half of the year

  • with a consequent rise in competitiveness and widespread fall in profits for all operators, especially suppliers of engineering services.

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Pininfarina S.p.A. and the subsidiary Pininfarina Engineering S.r.l. in particular saw their revenue fall in 2019, leading to operating losses. The parent also incurred impairment losses on a facility and other assets following the impairment tests carried out.

Economic trends had a negative impact on cash and cash equivalents and the net financial debt, which was also increased due to the recognition of lease liabilities (following IFRS 16 coming into effect) which were absent at 31 December 2018.

The group

The group recognised revenue of €90.4 million for 2019, a 14% decrease on the previous year regarding all segments with the exception of design activities on the Chinese market.

Gross operating loss came to €1.7 million, compared to gross operating profit of €12.6 million in 2018, due to the drop in revenue and sales prices caused by trends in the automotive segment, as mentioned above.

Operating loss amounted to €19.4 million compared to operating profit of €3.8 million in 2018. The downswing is mainly due to the gross operating loss and impairment losses on the parent's property and other assets (€9.2 million). Following the impairment tests carried out, the parent reduced a facility's carrying amount to its fair value (by €4.0 million) and that of other assets to their recoverable value (by €5.2 million).

The group's net financial expense for the year amounted to €1.5 million compared to €2.4 million for 2018. This improvement is mainly due to positive trends in cash flows used by the parent over the year.

The group recognised a tax expense of €2.2 million compared to a tax benefit of €0.8 million in the previous year, due to the reversal of the deferred tax assets recognised by Italian companies in 2018.

As a result of the above, the group recorded a loss for the year of €23.1 million compared to a profit of €2.2 million for the previous year.

The group's equity dropped from €61.7 million at 31 December 2018 to €39 million at the reporting date (- 37%), principally due to the loss for the year.

The net financial position of €5.2 million at 31 December 2018 decreased to net financial debt of €12 million at the reporting date. The FTA of IFRS 16 (which became effective in 2019) led to a €6.3 million decrease on the previous year.

The workforce numbered 672 at the reporting date (31 December 2018: 656; +2%).

2019 performance by business segment

The Pininfarina Group was involved in a number of corporate transactions during 2018 and in early 2019, aimed at streamlining and rationalising the various services offered and grouping them into dedicated legal entities. With effect from 1 July 2018, Pininfarina S.p.A. transferred its engineering business unit and 100% investment in Pininfarina Deutschland Holding GmbH (active in the German engineering market) to Pininfarina Engineering S.r.l., which was incorporated in May 2018. Moreover, with effect from 1 January 2019, Pininfarina Extra S.r.l., which engages in non-automotive design and architecture activities, was merged into Pininfarina S.p.A., which also acquired, as a result of the above merger, the 100% investment in Pininfarina of America Corp, a company active in the architecture and industrial design market. In addition, the group progressively reduced its non-core operations, such as the sale of spare parts (for cars manufactured in the past up to 2010) and other activities. Starting from 2019, the allocation of the group's operations to business segments has changed as a result of the variations described above. In line with IFRS 8, the group has identified two new business segments. Starting from 1 January 2019, the new reportable segments are the Design and Engineering business segments. The 2018 figures have been reclassified accordingly.

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Design segment

In addition to the revenue from the automotive and non-automotive design activities of all kinds, this segment includes revenue from architecture services, royalties for the use of the Pininfarina trademark, revenue from aerodynamic and aeroacoustic services and the income and costs arising from the parent's property management. It recognised revenue of €54.7 million, down by roughly 10% on the €60.5 million recognised in 2018. Reference should be made to the "General considerations" section for further details.

Its operating loss came to €14.1 million, compared to an operating profit of €5.9 million in 2018, mainly due to the impairment losses on a property and other assets (€9.2 million in total) as a result of the impairment tests required following the drop in the fair value or value in use of such assets compared to their respective carrying amounts. The impairment losses are also partly due to changed prospects for the parent and group following the difficult macro-economic situation of the automotive segment, leading to smaller volumes and profits on design activities, the manufacturing of prototypes and show cars and smaller royalties for the use of the trademark (roughly €3 million).

Engineering segment

This segment, comprising the Italian and German engineering businesses, recognised revenue of €35.7 million, down 20% on 2018 (€44.8 million) for the seasons set out in the "General considerations" section.

Its operating loss came to €5.3 million, up on the €2.1 million recorded in 2018, due to the reduction in revenue and profits in Italy.

The key financial figures of the parent are summarised below:

(€'million)

Draft financial

statements

2018

Variation

2019

Revenue

47.3

63.2

-15.9

EBITDA

-1.5

8.8

-10.3

EBIT

-14.3

6.5

-20.8

Net financial expense

-0.6

-1.6

1.0

Profit for the year

-16.5

5.7

-22.2

Net financial position (debt)

-6.6

-0.1

-6.5

Equity

55.3

66.2

-10.9

EBITDA is the operating profit or loss gross of amortisation, depreciation, provisions, impairment losses, reversals of impairment losses and utilisation of provisions.

EBIT is the operating profit or loss.

Events after the reporting date

On 18 December 2018 the deed of merger by incorporation of Pininfarina Extra S.r.l. into the parent company Pininfarina S.p.A was stipulated. Starting from 1 January 2019, the Italian design activities in the automotive sector and those related to industrial design, architecture and more generally to brand extention have therefore merged into a single company with expectations in terms of synergies between services aimed at the different market segments.

As regards the effects of the current health emergency (Coronavirus), on the prospective trend of the Pininfarina group and consequently on the assessments relating to the use of the going concern assumption in preparing the financial statements of the parent company and the Group, the following considerations are appropriate:

  • almost all of the design and/or engineering orders developed by Pininfarina are commissioned by significant national and international customers who operate withmedium/long-term planning that entail large multi-year product investments. These considerations lead us to believe that the current order backlog and the forecast of new activities in the short term are not overall compromised by the situation of tension deriving from the current health emergency. As of the date of this Financial Report, the Group, also considering the contacts with clients and the progress of contracts in progress, has not seen overall

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reductions in activity or cancellation of orders due to the coronavirus such as to show a performance substantially dissimilar to the expectations preceding the spread of the virus. The only exception concerns the Chinese market in which, in the months of January and February 2020, the production activity and the provision of services was drastically reduced following the measures of the authorities. In that market, the design activities managed on site by Pininfarina Shanghai were postponed to the following months. However, from current signals, the year 2020 is expected to close, if not with the same volume of business and margins previously expected, with positive results. The other important markets for the Group's activities (India, Germany, Italy and USA) do not currently show negative signs compared to forecasts;

  • as already commented, the performance of the automotive sector in 2019 was characterized by generalized volume reductions and margin contractions. The Company therefore has strengthen its financial capacity to support the Group. In this perspective, Pininfarina S.p.A. has signed a financing agreement with the Mahindra group of 20 million euros (transaction disclosed to the market on February 28, 2020) which has increased the financial resources available for any type of need, including those potentially deriving from important business changes compared to the objectively verifiable situation as of today. Having said that, it is clear that a generalized block of the activities on the reference markets for a long period of time and without external interventions would lead to a situation difficult to manage by a single company (of any size and financial capacity it may be). Lastly, although objectively predictable to date, the liquidity reserves available in the Parent Company, considering the liquidity situation at the end of February and the new availability guaranteed by the Mahindra group as well as considering the relationships with existing customers, lead to consider the market current moment and its trend in the foreseeable future, not so negative as to create uncertainties on business continuity, also taking into account the measures in support of companies that have recently been approved by the Italian Government and which could be activated in cases of extreme need also by the parent company and the subsidiary Pininfarina Engineering.

Outlook for 2020

Based on the current situation of the business sectors where the Pininfarina Group operates, its outlook for 2020 is a fall in revenue compared to 2019, along with an operating loss and a loss for the year.

Annual report on corporate governance and ownership structure, Remuneration report and Consolidated non-financial statement

The Board of Directors also approved the Annual report on corporate governance and ownership structure, the Remuneration report and the Consolidated non-financial statement for 2019. They will be available in the "Investor Relations - Corporate governance" section of the parent's website (www.pininfarina.com) as from 20 April 2020, as well as through the other methods provided for by current legislation.

The Board of Directors called theshareholders' meeting for11 May 2020, at 11.00 a.m. at Pininfarina S.p.A.'s offices in Cambiano (TO) on first call and, if necessary, for 12 May 2020 on second call, same time and place. The agenda includes the approval of the 2019 financial statements, allocation of the profit for the year, the approval of the 2019 remuneration report.

The Board of Directors did not propose any dividend distribution.

Contacts:

Pininfarina:

Gianfranco Albertini, C.F.O. and Investor Relations, Phone 011.9438367 Francesco Fiordelisi, Corporate communication, Phone 011.9438105/335.7262530

Studio Mailander:

Carolina Mailander, Phone 011.5527311/335.6555651

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RECLASSIFIED FINANCIAL STATEMENTS (*)

  1. The reclassified financial statements group the figures presented in thelegally-required statements to improve their understanding, without however changing their presentation logic.

The terms "EBITDA" and "EBIT" as used in the reclassified financial statements are the "operating profit or loss", gross of amortisation, depreciation, provisions, impairment losses, reversals of impairment losses and utilisation of provisions, and "operating profit or loss" presented in the IFRS financial statements, respectively.

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PININFARINA GROUP

Reclassified income statement

(€'000)

2019

%

2018

%

Variation

Revenue from sales and services

85,301

94.36

102,899

97.69

(17,598)

Change in finished goods

(17)

(0.02)

(26)

(0.02)

9

Other revenue and income

5,114

5.66

2,454

2.33

2,660

Revenue

90,398

100.00

105,327

100.00

(14,929)

Net gains (losses) on the sale of non-current assets

(34)

(0.04)

184

0.17

(218)

Materials and services (*)

(37,076)

(41.01)

(42,900)

(40.73)

5,824

Change in raw materials

(32)

(0.04)

41

0.04

(73)

Value added

53,256

58.91

62,652

59.48

(9,396)

Labour cost (**)

(54,996)

(60.85)

(50,038)

(47.50)

(4,958)

Gross operating profit (loss)

(1,740)

(1.92)

12,614

11.98

(14,354)

Amortisation and depreciation

(4,918)

(5.43)

(3,433)

(3.27)

(1,485)

(Additions to)/utilisation of provisions and impairment losses

(12,711)

(14.06)

(5,386)

(5.11)

(7,325)

Operating profit (loss)

(19,369)

(21.43)

3,795

3.60

(23,164)

Net financial expense

(1,469)

(1.63)

(2,397)

(2.27)

928

Share of loss of equity-accounted investees

(2)

0.00

(21)

(0.02)

19

Profit (loss) before taxes

(20,840)

(23.05)

1,377

1.31

(22,217)

Income taxes

(2,235)

(2.48)

796

0.75

(3,031)

Profit (loss) for the year

(23,075)

(25.53)

2,173

2.06

(25,248)

-

-

-

-

-

  1. Materials and servicesare net of utilisations of the provisions for product warranties and risks (€7 thousand and €227 thousand for
    2018 and 2019, respectively).
    (**) Labour costis net of utilisations of the restructuring provision (€44 thousand and €184.5 thousand for 2018 and 2019, respectively). As required by Consob resolution no. DEM/6064293 of 28 July 2006, a reconciliation of the data in the consolidated financial statements with those in the reclassified schedules is provided below:
    -Materials and servicesinclude raw materials and components, other variable production costs, external variable engineering services, exchange gains and losses and other expenses.
    -Amortisation and depreciationcomprise amortisation of intangible assets and depreciation of property, plant and equipment and investment property.
    -(Additions to)/utilisation of provisions and impairment losses include additions to/utilisation of provisions, impairment losses and inventorywrite-downs
    -Net financial income (expense)comprises net financial income (expense) and dividends.

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PININFARINA GROUP

Reclassified statement of financial position

(€'000)

31.12.2019

31.12.2018

Variation

Net non-current assets (A)

Net intangible assets

6,092

7,326

(1,234)

Net property, plant and equipment and investment property

40,481

49,979

(9,498)

Right-of-use assets

5,785

-

5,785

Equity investments

854

857

(3)

Total A

53,212

58,162

(4,950)

Working capital (B)

Inventories

360

408

(48)

Contract assets

4,617

3,131

1,486

Net trade receivables and other assets

40,004

34,647

5,357

Assets held for sale

1,819

-

1,819

Deferred tax assets

839

3,019

(2,180)

Trade payables

(19,638)

(16,971)

(2,667)

Contract liabilities

(14,624)

(13,566)

(1,058)

Provisions for risks and charges

(3,452)

(620)

(2,832)

Other liabilities (*)

(7,864)

(6,892)

(972)

Total B

2,061

3,156

(1,095)

Net invested capital (C=A+B)

55,273

61,318

(6,045)

Post-employment benefits (D)

4,243

4,778

(535)

Net capital requirements (E=C-D)

51,030

56,540

(5,510)

Equity (F)

39,001

61,749

(22,748)

Net financial (position) debt (G)

Non-current loans and borrowings

24,840

21,891

2,949

Net current financial position

(12,811)

(27,100)

14,289

Total G

12,029

(5,209)

17,238

Total as in E (H=F+G)

51,030

56,540

(5,510)

(*) Other liabilities include the following items: deferred tax liabilities, other financial liabilities, current tax liabilities and other liabilities.

PININFARINA GROUP

Net financial position (debt)

(€'000)

31.12.2019

31.12.2018

Variation

Cash and cash equivalents

20,115

18,357

1,758

Current assets held for trading

-

13,106

(13,106)

Current bank overdrafts

(2,368)

(725)

(1,643)

Lease liabilities

(1,298)

-

(1,298)

Loans and borrowings - related parties and joint ventures

-

-

-

Current portion of bank loans and borrowings

(3,638)

(3,638)

-

Net current financial position

12,811

27,100

(14,289)

Non-current loans and receivables - third parties

-

-

-

Non-current loans and receivables - related parties

550

550

-

Non-currentheld-to-maturity investments

-

-

-

Non-current lease liabilities

(4,990)

-

(4,990)

Non-current bank loans and borrowings

(20,400)

(22,441)

2,041

Non-current loans and borrowings

(24,840)

(21,891)

(2,949)

NET FINANCIAL POSITION (DEBT)

(12,029)

5,209

(17,238)

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PRESS RELEASE

PININFARINA S.p.A.

Reclassified income statement

(€'000)

2019

%

2018

%

Variation

Revenue from sales and services

44,699

94.58

61,925

97.94

(17,226)

Change in finished goods

(17)

( 0.04)

(15)

( 0.02)

(2)

Other revenue and income

2,581

5.46

1,313

2.08

1,268

Revenue

47,263

100.00

63,223

100.00

(15,960)

Net gains (losses) on the sale of non-current assets

( 34)

(0.07)

184

0.29

( 218)

Materials and services (*)

(27,068)

(57.27)

(32,099)

(50.77)

5,031

Change in raw materials

(32)

(0.07)

41

0.07

(73)

Value added

20,129

42.59

31,349

49.58

(11,220)

Labour cost (**)

(21,648)

(45.80)

(22,589)

(35.72)

941

Gross operating profit (loss)

(1,519)

(3.21)

8,760

13.86

(10,279)

Amortisation and depreciation

(2,630)

(5.57)

(2,567)

(4.06)

(63)

(Additions to)/utilisation of provisions and impairment (losses) and gains

(10,186)

(21.55)

264

0.42

(10,450)

Operating profit (loss)

(14,335)

(30.33)

6,457

10.21

(20,792)

Net financial expense

(579)

(1.23)

(1,580)

(2.51)

1,001

Share of loss of equity-accounted investees

(2)

0.00

(33)

(0.05)

31

Profit (loss) before taxes

(14,916)

(31.56)

4,844

7.66

(19,760)

Income taxes

(1,633)

(3.45)

886

1.41

(2,519)

Profit (loss) for the year

(16,549)

(35.01)

5,730

9.06

(22,279)

  1. Materials and servicesare net of utilisations of the provisions for product warranties and risks (€7 thousand and €227 thousand for
    2018 and 2019, respectively).
    (**) Labour costis net of utilisations of the restructuring provision (€44 thousand and €184.5 thousand for 2018 and 2019, respectively).

As required by Consob resolution no. DEM/6064293 of 28 July 2006, a reconciliation of the data in the separate financial statements with those in the reclassified schedules is provided below:

  • Materials and servicesinclude raw materials and components, other variable production costs, external variable engineering services, exchange gains and losses and other expenses.
  • Amortisation and depreciationcomprise amortisation of intangible assets and depreciation of property, plant and equipment and investment property.
  • (Additions to)/utilisation of provisions and impairment lossesinclude additions to/utilisation of provisions, impairment losses and inventorywrite-downs
  • Net financial income (expense)comprises net financial income (expense) and dividends.

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PININFARINA S.p.A.

Reclassified statement of financial position

(€'000)

31.12.2019

31.12.2018

Variation

Net non-current assets (A)

Net intangible assets

5,450

5,963

(513)

Net property, plant and equipment and investment property

33,122

40,231

(7,109)

Right-of-use assets

-

-

-

Equity investments

22,231

24,044

(1,813)

Total A

60,803

70,238

(9,435)

Working capital (B)

Inventories

360

266

94

Contract assets

954

839

115

Net trade receivables and other assets

30,094

22,387

7,707

Assets held for sale

290

-

290

Deferred tax assets

-

1,255

(1,255)

Trade payables

(13,145)

(14,566)

1,421

Contract liabilities

(9,658)

(7,541)

(2,117)

Provisions for risks and charges

(867)

(528)

(339)

Other liabilities

(3,950)

(3,342)

(608)

Total B

4,078

(1,230)

5,308

Net invested capital (C=A+B)

64,881

69,008

(4,127)

Post-employment benefits (D)

2,978

2,717

261

Net capital requirements (E=C-D)

61,903

66,291

(4,388)

Equity (F)

55,269

66,239

(10,970)

Net financial debt (G)

Non-current loans and borrowings

18,309

20,025

(1,716)

Net current financial position

(11,675)

(19,973)

8,298

Total G

6,634

52

6,582

Total as in E (H=F+G)

61,903

66,291

(4,388)

PININFARINA S.p.A.

Net financial position (debt)

(€'000)

31.12.2019

31.12.2018

Variation

Cash and cash equivalents

17,036

11,183

5,853

Current assets held for trading

-

13,106

(13,106)

Lease liabilities

(100)

-

(100)

Loans and borrowings - related parties

(1,683)

(738)

(945)

Current portion of bank loans and borrowings

(3,578)

(3,578)

-

Net current financial position

11,675

19,973

(8,298)

Non-current loans and receivables - related parties

2,191

2,326

(135)

Non-current lease liabilities

(130)

-

(130)

Non-current bank loans and borrowings

(20,370)

(22,351)

1,981

Non-current loans and borrowings

(18,309)

(20,025)

1,716

NET FINANCIAL DEBT

(6,634)

(52)

(6,582)

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Related party transactions - Pininfarina Group

The table below, which is presented pursuant to Consob communication no. DEM/6064293 of 28 July 2006, summarises related party transactions, including intragroup transactions. These transactions were carried out at market conditions, consistent with the nature of the goods exchanged or services provided. They were neither atypical nor unusual for the purposes of the above-mentioned communication.

Commercial

Financial

Operating

Financial

Assets

Liabilities

Assets

Liabilities

Revenue

Expense

Income

Expense

Signature S.r.l.

48,800

1,818

550,000

-

118,894

78,354

-

-

Tech Mahindra Ltd

5,370

162,240

-

-

250,654

219,411

-

-

Tech Mahindra GmbH

24,051

-

-

-

204,069

-

-

-

Mahindra&Mahindra Ltd

113,940

-

-

-

9,820,076

-

-

-

Mahindra Graphic Research Design S.r.l.

-

-

-

-

-

143,585

-

-

PT Mahindra Accelo Steel Indonesia

-

31,746

-

-

44,754

-

-

-

Mahindra North America Technical Center

23,850

-

-

-

55,022

-

-

-

Ssangyong Motor Company

-

-

-

-

302,000

-

-

-

Automobili Pininfarina GmbH

652,816

2,060,151

-

-

14,211,401

-

-

-

Total

868,827

2,255,955

550,000

-

25,006,870

441,350

-

-

Intragroup transactions include:

  • Signature S.r.l.: loan agreement, purchases and sales of goods with Pininfarina S.p.A.;
  • Tech Mahindra Ltd: services agreements in favor of Pininfarina Engineering S.r.l. and Pininfarina S.p.A.; services agreements with Pininfarina S.p.A., Pininfarina Engineering S.r.l., Pininfarina Deutschland GmbH and Pininfarina of America Corp.;
  • Tech Mahindra GmbH: lease agreement for equipped office premises with Pininfarina Deutschland GmbH;
  • Mahindra & Mahindra Ltd: brand licence agreement and engineering services agreements with Pininfarina S.p.A. and Pininfarina Engineering S.r.l.;
  • Mahindra Graphic Research Design S.r.l.: engineering services agreement in favor of Pininfarina Engineering S.r.l.;
  • PT Mahindra Accelo Steel Indonesia: design services agreement with Pininfarina S.p.A.;
  • Mahindra North America Technical Center: services agreement with Pininfarina Engineering S.r.l.;
  • Ssangyong Motor Company: design services agreement with Pininfarina S.p.A.;
  • Automobili Pininfarina Gmbh: design and engineering agreement with Pininfarina S.p.A..

In addition to the above figures:

  • legal assistance activity provided to the parent by Studio Starclex - Studio Legale Associato
    Guglielmetti, related to Romina Guglielmetti (director of Pininfarina S.p.A.), for € 36,000.
  • consulting activity provided to Pininfarina Engineering S.r.l. by Mr. Roberto Mattio for a gross amount of € 6.960.

On 26 September 2018, Pininfarina Engineering S.r.l. signed an engineering services agreement with Mahindra & Mahindra Ltd ("M&M") for the development of a project to design the upper body systems of the body shell, integration of the body shell with the main operating systems and achievement of the performance requested of a new Mahindra vehicle based on its new platform.

Pininfarina Engineering S.r.l. will receive a fee of €10,583,172 for its services to be provided over roughly 16 months. This fee qualifies the transaction as a "major transaction" pursuant to the relevant legislation. The services provided are part of the "company's normal business activities" and are rendered on an arm's length basis. At the reporting date, services provided to the customer totalled €10,553,138, €7,783,643 of which in

D I R E Z I O N E C O M U N I C A Z I O N E E I M M A G I N E - W W W . P I N I N F A R I N A . C O M - I N F O @ P I N I N F A R I N A . C O M

PRESS RELEASE

2019. The project as of December 31, 2019 has not ended because, according to the customer's instructions, the end-of-project tunnel test has been postponed to 2020.

The parent, Pininfarina S.p.A., signed five design and engineering services agreements with Automobili Pininfarina GmbH ("AP") on 29 June 2018, 26 March 2019, 31 May 2019, 22 July 2019 and 9 December 2019, respectively, for the development of a project to design the interior and exterior of a new car, to design the upper body systems of the body shell, integration of the body shell with the main operating systems and achievement of the performance requested of a new AP vehicle based on its new platform.

The parent will receive a total fee of €20,510,277 for its services to be provided under the above contracts from June 2018 to December 2020. This fee qualifies the transaction as a "major transaction" pursuant to the relevant legislation. The services provided are part of the "company's normal business activities" and are rendered on an arm's length basis. At the reporting date, services provided to the customer totalled €14,261,633, €10,345,998 of which in 2019.

On 25 July 2019, Pininfarina Engineering S.r.l. signed an engineering services agreement with Mahindra & Mahindra Ltd ("M&M") for the development of a project to design the upper body systems of the body shell, integration of the body shell with the main operating systems and achievement of the performance requested of a new vehicle.

Pininfarina Engineering S.r.l. will receive a fee of €4,046,408 for its services to be provided over roughly 14 months. This fee qualifies the transaction as a "major transaction" pursuant to the relevant legislation. The services provided are part of the "company's normal business activities" and are rendered on an arm's length basis. Services provided to the customer at the reporting date totalled €1,030,666.

Directors' and statutory auditors' fees

(€'000)

2019

2018

Directors

737

812

Statutory Auditors

107

112

Total

844

924

Related party transactions - Pininfarina S.p.A.

Commercial

Financial

Operating

Financial

Assets

Liabilities

Assets

Liabilities

Revenue

Expense

Income

Expense

Signature S.r.l.

48,800

1,818

550,000

-

118,894

78,354

-

-

Pininfarina Extra S.r.l.

-

-

-

-

-

-

-

-

Pininfarina Engineering S.r.l.

2,305,060

876,113

141,077

1,683,087

1,956,320

9,025,169

-

-

Pininfarina Deutschland GmbH

25,386

-

1,500,000

-

25,386

-

10,327

-

Pininfarina Shanghai Co. Ltd

944,190

4,962

-

-

1,267,149

15,962

500,000

-

Pininfarina of America Co. Ltd

154,603

7,869

-

-

511,581

7,982

-

-

Tech Mahindra Ltd

4,480

-

-

-

209,898

10,800

-

-

Mahindra&Mahindra Ltd

-

-

-

-

2,347,919

-

-

-

Pt Mahindra Accelo Steel Indonesia

-

31,746

-

-

44,754

-

-

-

Automobili Pininfarina GmbH

652,816

2,060,151

-

-

14,181,925

-

-

-

Ssangyong Motor Company

-

-

-

-

302,000

-

-

-

Total

4,135,335

2,982,659

2,191,077

1,683,087

20,965,826

9,138,267

510,327

-

D I R E Z I O N E C O M U N I C A Z I O N E E I M M A G I N E - W W W . P I N I N F A R I N A . C O M - I N F O @ P I N I N F A R I N A . C O M

PRESS RELEASE

Intragroup transactions include:

  • Signature S.r.l.: loan agreement and purchases of goods;
  • Pininfarina Engineering S.r.l.: lease for the equipped premises, secondment agreements, cost sharing agreement and services agreements;
  • Pininfarina Deutschland GmbH: loan agreement;
  • Pininfarina Shanghai Co Ltd: services agreement, secondment agreement and cost sharing agreement;
  • Pininfarina of America Corp.: secondment agreement and cost sharing agreement;
  • Tech Mahindra Ltd: services agreement and recharge of costs incurred by Pininfarina S.p.A. on the company's behalf;
  • Mahindra & Mahindra Ltd: brand licence agreement and engineering services agreements;
  • PT Mahindra Accelo Steel Indonesia: design services agreement;
  • Automobili Pininfarina GmbH: design and engineering services agreement;
  • Ssangyong Motor Company: design services agreement.

In addition to the above figures, Studio Starclex - Studio Legale Associato Guglielmetti, related to Romina Guglielmetti (director of Pininfarina S.p.A.), provided legal assistance to the company for €36,000.

Directors' and statutory auditors' fees

(€'000)

2019

2018

Directors

737

552

Statutory Auditors

99

102

Total

836

654

The total fees to Pininfarina S.p.A.'s key management personnel approximate €2.2 million for 2019, of which:

  • remuneration for employee €1.1 million;
  • incentives €0.8 million;
  • rights for stock options vesting €0.3 million.

D I R E Z I O N E C O M U N I C A Z I O N E E I M M A G I N E - W W W . P I N I N F A R I N A . C O M - I N F O @ P I N I N F A R I N A . C O M

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Pininfarina S.p.A. published this content on 23 March 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 March 2020 21:36:11 UTC