Corporate

All the people of the Mondadori Group gather around their Chairman, Marina Berlusconi, for the state funeral of her father, Silvio, while several initiatives have been implemented by the Group to honour the memory of an unforgettable man, a courageous entrepreneur, an enlightened publisher and a far-sighted politician.

“In these difficult days we wish to express our compassion and sympathy for our Chairman, Marina Berlusconi, demonstrating both visibly and symbolically the deep void left by the death of her father, Silvio, a crucial figure in the history of our company and our country”, wrote the CEO of the Mondadori Group, Antonio Porro, in a statement to employees and collaborators.

That’s why the Mondadori Group has decided to leave Palazzo Niemeyer at “half-light” for the first time, leaving an entire part of the building entirely dark every evening this week.

A void, a lack of light that will also be accompanied by a minute of silence that will be observed this afternoon at 3 p.m. in all the Group’s offices, coinciding with the beginning of the State funeral, to symbolically embrace Chairman Marina Berlusconi and all the family members who mourn the death of their beloved father.

Furthermore, today the Mondadori Duomo and Rizzoli Galleria bookshops in Milan will remain closed for the entire day. The main events in stores throughout the country will be suspended and a commemorative image of Silvio Berlusconi will be displayed.

Today, June 12, 2023, Silvio Berlusconi has left us.

The CEO, Antonio Porro, Board of Direcots, Board of Statutory Auditors, Management Committee and all the people of the Mondadori Group share the pain of their Chairman, Marina Berlusconi, and her family for the loss of the beloved Silvio Berlusconi, an unforgettable man, brave entrepreneur, enlightened publisher, forward-looking politician, undisputed protagonist of our Nation’s story.

His memory will never cease to accompany us.

Arnoldo Mondadori Editore S.p.A. (LEI Code 815600049A1F9AFE6666) announces the purchase on the Euronext Milan regulated market, in the period from 5 to 9 June 2023, of no 270,000 ordinary shares (equal to 0,103% of the share capital) at an average unit price of €1,89855 for a total amount of €512,609.10.

These transactions were made under the authorization to purchase treasury shares approved by the Shareholders’ Meeting of 27 April 2023, and as part of the purchase programme to service the Performance Share Plans underway, the start of which was approved by the Board of Directors on 10 May 2023 (as per the disclosure made on the same date also pursuant to Article 144 bis of CONSOB Regulation 11971/99, and to Article 5 of EU Regulation 596/2014).

The following table details the purchases made per day in the above period of Arnoldo Mondadori Editore S.p.A. ordinary shares, ISIN Code IT0001469383, on a daily basis:

The purchases were made through the authorized intermediary Intesa San Paolo S.p.A. (LEI Code 2W8N8UU78PMDQKZENC08), independently and with no influence from the Issuer as regards the timing of the purchases.

Following the purchases made so far, Arnoldo Mondadori Editore S.p.A. holds no 956,802 treasury shares, equal to 0.366% of the share capital.

Purchases in detail in the complete pdf.

Today, the meeting of the Board of Directors of Arnoldo Mondadori Editore S.p.A., chaired by Marina Berlusconi, reviewed and approved the Interim Management Statement at 31 March 2023 presented by CEO Antonio Porro.

1ST QUARTER 2023 HIGHLIGHTS

The first quarter of the current year was characterised by a positive trend in the book market which, following a consolidation phase experienced in 2022, recorded renewed growth with an increase in both value (+3%) and volume (+0.8%)[1].

“During this first quarter of 2023, the Mondadori Group recorded a significant improvement in profitability-  taking into account the seasonal nature of the schoolbook business – thanks to the positive performance of revenues and an increasingly careful approach to operative management. The excellent start to the year for the book market, the slight fall in the prices of raw materials and services, and the company’s performance allow us to confirm our estimates for the year, with revenues and Adjusted EBITDA growing by a single-digit and margins expected to be around 15%,” emphasised Antonio Porro, Chief Executive Officer of the Mondadori Group.

PERFORMANCE AT 31 MARCH 2023

Consolidated revenue in the first quarter of 2023 amounted to € 160 million, up by approximately 4.5% compared to € 153.1 million in the previous year. Net of changes in scope occurring between the two periods, the organic change in growth amounted to +3.6%.

Adjusted EBITDA came to € 4.4 million, showing a significant increase on the € -1.1 million of the first quarter 2022: both the growth in revenues, in particular of the Trade Books and Retail areas, and the consolidation of the results of the companies only recently acquired, contributed to the Group’s positive results.

The Group’s EBITDA came to € 4.7 million compared to € -0.7 million in the first quarter of 2022, an improvement of almost € 5.5 million, traceable to the favourable dynamics of the above management components.

EBIT is negative for € 8.2 million, showing an improvement of € 4 million on 2022, thanks to the positive operating performance of the businesses, despite the booking of € 1 million for greater amortisation/depreciation deriving from investments, from the consolidation of newly-acquired companies and the accounting effects of the Purchase Price Allocation process (PPA).

Excluding the extraordinary components and the impacts deriving from the PPA process relative to the companies acquired in the last 2 years (€ 1.2 million), Adjusted EBIT came to € -7.2 million, up € 4.5 million on the same quarter of the previous year.

The consolidated result before tax is negative for € 8.8 million, an improvement of approximately € 5.6 million on the € -14.4 million in first quarter 2022, thanks to:

• a reduction in finance expenses (€ 1.2 million as at 31 March 2022) despite a higher average cost of debt, thanks to the reduced expenses deriving from the application of IFRS 16, as a result of the new rental contract for the Segrate head office;
• an improvement in the result of the subsidiaries for € 1.4 million, deriving in particular from the update of the fair value measurement of the equity investment in the company A.L.I..

It is recalled that after the end of the first quarter, the 18.45% equity investment held in the share capital of Società Europea di Edizioni, publisher of Il Giornale, was sold.

At 31 March 2023, the Group’s net loss, after minority interests, came to € 5.2 million, showing a sharp increase of approximately € 6 million versus the € -11.4 million recorded in Q1 2022.
Mention should be made that in the first quarter of the year, a net loss is recorded at a consolidated level, due to the seasonal nature of the school textbooks business.

The IFRS 16 Net Financial Position came to € -220.8 million, essentially stable on the € -217.4 million recorded at 31 March 2022, including an IFRS 16 component of € -70.1 million.
The Pre-IFRS 16 Net Financial Position came to approximately € -150.7 million, slightly up on the € -135.8 million of 31 March 2022 due to the cash-out relative to acquisitions made during the last twelve months and the distribution of dividends.

Cash flow from ordinary operations (after outlays for financial expense and tax) in the last 12 months, amounted to € 63 million and allows the Group to continue to strengthen its financial structure. Note that ordinary cash generation was impacted as follows:

• the improvement in the business income management, partly temporarily offset by the dynamics of working capital;
• the lower tax payments for approximately € 3 million, mainly deriving from realignments and tax redemption applied during previous years.

At 31 March 2023, cash flow from extraordinary operations of the previous 12 months came to a negative € 61.5 million, mostly due to cash out for restructuring costs of € 7.2 million and for the net balance of acquisitions and disposals of approximately € 47 million.
Consequently, the LTM Free Cash Flow as at 31.03.2023 was positive by € 1.5 million, demonstrating the Group’s ability to finance its inorganic growth policy and to remunerate its shareholders.

Group employees at 31 March 2023 amounted to 1,911 units, up by approximately 1.5% versus 1,883 resources at 31 March 2022 (+28). Neutralising the effects of all the changes in scope applied, namely the acquisitions of De Agostini Libri, Star Comics and A.L.I. and the disposals of newspapers and business in the Media area, the Group’s workforce would show an increase of 0.9%.

OUTLOOK FOR THE YEAR

In light of the results achieved during the first quarter and a more favourable scenario in respect of the outlook for raw materials and service prices, with reference to the current scope, the Group believes it can now confirm the forecasts released previously for FY 2023.

Income Statement:

• Single-digit growth in revenues and adjusted EBITDA with margins expected to be in the region of 15%;
• approximately 10% growth in the net result, despite the greater amortisation/depreciation deriving from both the increasing investment policy implemented by the Group and the effects of the Purchase Price Allocation process relative to the recently-acquired companies.

Cash Flow and Net Financial Position:

• Ordinary Cash Flow is expected to fall within a range of € 60 to 65 million, showing growth of up to 10% on the 2022 figure (which had come to approximately € 60 million net of the one-off impact of derivative instruments related to rate risk hedging).
• the Group’s net financial debt (IFRS 16) is expected to come in, at end FY 2023, as 0xAdjusted EBITDA, down from 1.3x at end 2022.

The solid financial and equity position that characterises the Group allows it to continue to pursue the virtuous development path started some years ago, characterised by the progressive use of M&As whereby the Group seeks to continue to the make the most of inorganic growth opportunities, mainly in the book and digital businesses.

PERFORMANCE OF BUSINESS AREAS

• TRADE BOOKS

The first quarter of the current year was characterised by a positive trend seen on the book market that, following a consolidation experienced in 2022, recorded renewed growth with an increase in both value (+3%) and volume (+0.8%)[2].

In this context, the publishing houses in the Trade area recorded double-digit sell-out growth (+12.3%), of which 6.7% due to an increase in the volume component, thanks in particular to the performance in January and February by the new titles published at the start of the year.
Thanks to these results, the Mondadori Group has consolidated its national leadership position, with a market share which rose to 27.4% in March 2023, compared to 25.2% in March 2022.

This year, as witness to the quality of the Group’s publishing plan, two titles from the Group’s publishing houses ranked in the top two places of the ten best-selling books by value[3]: Prince Harry’s biography ‘Spare. Il minore‘, published by Mondadori, and ‘La vita intima’ by Niccolò Ammaniti, published by Einaudi.

Q1 2023 revenues came to € 88.3 million, showing growth of 29.5% on last year, structured as follows:

• +25% in the publishing houses, also due to the companies acquired, which contributed approximately € 8 million in the period; net of discontinuities, the improvement comes to 10% thanks to the concentration, in the quarter’s publishing plan, also of particularly successful titles;
• significant recovery of the museum business of Electa (+27%) and the positive international sales performance of Rizzoli International Publications (+12.5%);
• marked growth in third-party publishers distribution and services activities, which benefited from the contribution made by the consolidation of A.L.I. (whose revenues are booked as a fee[4]) and Libromania.

Adjusted EBITDA of the Trade Books area comes to € 13.2 million, up € 3.5 million, of which approximately one third comes from the positive trend of like-for-like revenues and two thirds from the contribution made by newly-acquired companies. ​
The profitability achieved by the Trade Books area is approximately 15% in the first quarter of 2023, showing improvement on the same period of 2022.

• EDUCATION BOOKS

School textbooks experience a typical seasonal performance that sees sales concentrated in the second half of the year following the adoption campaign: revenues from the first three months of the year typically account for less than 5% of the annual figure.

In this context, in the first quarter of 2023, the Group’s Education area recorded total revenues of € 8.5 million (€ 9 million in the same period of 2022) with a negative change that does not represent actual performance insofar as the result of different timing, compared to 2022, in the supply and invoicing of certain supplies.

Adjusted EBITDA comes to € -11.7 million, in line with FY 2022, due to the specified seasonality, which sees the booking during the first quarter of the operational structure costs and the costs for developing the text books marketed during the adoption campaign, which then draws to a close at the end of May.

• RETAIL

As already mentioned, at the end of March, Italy’s book market had grown by 3% compared to 2022, with +10.6% increase in the physical channel and a decline (estimated at -6%) in e-commerce.

In this context, the revenues of Mondadori Retail in the first quarter of 2023 amounted to € 41.6 million, an improvement of around 12% compared to the same period of the previous year: this was the result, in particular, of sustained growth in revenues from books (+€ 3.7 million, up by 12.8% compared to the first quarter of 2022).
Thanks to this overperformance, deriving from the excellent performance of physical shops, Mondadori Retail’s market share came to 11.7% (+0.9% compared to 31 March 2022).

An analysis of sales in the physical channel shows a further increase in revenues from directly-managed bookstores (+21.1% compared to the same period in the previous year) and franchisee bookstores (+9.5% compared to the first quarter of the previous year);

Adjusted EBITDA in the Retail area was positive, amounting to € 1.7 million, and showed a significant increase (+€ 1.4 million compared to the first three months of 2022), thanks to the continuous development and renovation work on existing shops and focus on the core business of books.

• MEDIA

In Q1 2023, the Media area recorded revenue of approximately € 32.3 million, dropping by approximately 31% versus the same period of the prior year, which reduced to approximately 8.5% on a like-for-like basis (excluding the effect of the deconsolidation of the titles sold at the start of 2023 and the distribution activities of Press-di).

In particular, the two area components showed different trends. On a like-for-like basis:

• digital activities, which account for more than a third of the area’s total revenue, showed growth in advertising revenue of 7%;
• traditional print activities were down by approximately 15%.

Adjusted EBITDA for the Media area came to € 2.9 million, showing growth of approximately 42% compared with the previous year, mainly due to traditional businesses. Specifically:

• in the print area, the increase stems from the booking of a tax credit by way of relief on costs incurred by the publisher for the distribution of magazines (€ 2.8 million), which more than offset the higher input costs for the period and the lower margin from the sales of collateral items;
• in the digital area, adjusted EBITDA is essentially stable on the same quarter of the previous year, thanks to higher advertising revenue and despite the higher costs incurred for launching new initiatives tied to the influencer marketing segment.

START OF SHARE BUYBACK PROGRAM TO SERVICE THE 2022-2024, 2021-2023 AND 2020-2022 SHARE PERFORMANCE PLANS

The Board of Directors of Arnoldo Mondadori Editore S.p.A. approved the start of a share buyback program, under Article 5 of Regulation (EU) no. 596/2014, to be executed in accordance with the terms and conditions, already disclosed to the public, resolved by the Ordinary Shareholders’ Meeting of 27 April 2023 which, among other things, authorized:

• the purchase and disposal of treasury shares for a maximum amount of up to 0.357% of the share capital, which is intended to provide the Company with the no. 933,548 shares required over the three-year period to meet the obligations under the 2023-2025 Performance Share Plan established by the same Shareholders’ Meeting, pursuant to Article 114-bis of the TUF;
• the continuation of the buyback program to service the 2021-2023 Performance Share Plan and the 2022-2024 Performance Share Plan in the manners and within the limits set out in the relevant Regulations.

Pursuant to Delegated Regulation (EU) 2016/1052, details of the buyback program are shown below:

• Purpose of the plan
  The sole purpose of the program is the buyback of Arnoldo Mondadori Editore S.p.A. treasury shares to service the 2023-2025 Performance Share Plan, the 2022-2024 Performance Share Plan and the 2021-2023 Performance Share Plan.
• Maximum amount in cash allocated to the program
  Buybacks will be made at a minimum unit price not lower than the official Stock Exchange price on the day before the purchase transaction, reduced by 20%, and at a maximum unit price not higher than the official Stock Exchange price on the day before the purchase transaction, increased by 10%. The volumes and unit purchase prices will, however, be defined in accordance with the conditions governed by Article 3 of EU Delegated Regulation 2016/1052. Specifically, no shares may be purchased at a price higher than the higher between the price of the last independent trade and the price of the highest current independent bid on the trading venue where the purchase is carried out. In terms of volumes, daily purchase amounts will not exceed 25% of the daily average volume of Mondadori shares traded over the 20 trading days before the dates of purchase.
• Maximum number of shares to purchase
  Purchases will regard a maximum of no. 591,000 ordinary shares (equal to 0.22%) of the share capital, taking account of the treasury shares already held in the Company’s portfolio, to service the 2023-2025 Performance Share Plan, the 2022-2024 Performance Share Plan and the 2021-2023 Performance Share Plan, in the manners and within the limits set out in the relevant Regulations.
  The maximum total amount of shares under the program is therefore within the limits of 10% of the share capital indicated by the Shareholders’ Meeting of 28 April 2022, taking account also of the no. 1,147,991 treasury shares, equal to 0.440% of the share capital, already held by the Company to date.
• Duration of the program
  The buyback program may start on 5 June 2023. The conclusion of the program, in any case by the Shareholders’ Meeting convened to approve the financial statements at 31 December 2023, the date on which authorisation to purchase treasury shares resolved by the Shareholders’ Meeting of 27 April 2023, expires, will be disclosed to the market.
  The buyback program may be renewed upon further authorization by the shareholders.
• Buyback procedures
  The buyback program will be coordinated and executed by an authorized intermediary, who will make the purchases independently, with no influence from Arnoldo Mondadori Editore S.p.A. as regards the timing of the purchases.
  Buybacks will be made pursuant to the combined provisions of Article 132 of Legislative Decree no. 58/1998 and of Article 5 of Regulation (EU) 596/2014, Article 144-bis of the Issuer Regulation, and the EU and national legislation on market abuse (including Delegated Regulation (EU) 2016/1052), in accordance with the resolutions of the above Shareholders’ Meeting of 28 April 2022.
  Any subsequent changes to the buyback program will be promptly disclosed by the Company. The transactions made will be disclosed to the market in the manners and within the time limits of applicable law.
  For information on the above Performance Share Plans, reference should be made to the information documents prepared pursuant to Article 114-bis of Legislative Decree no. 58/1998 and to Article 84-bis of CONSOB Regulation no. 1197/1999 and available on the website www.mondadorigroup.com ( Governance section) and at the authorized storage mechanism 1Info (www.1Info.it).

2023-2025 PERFORMANCE SHARE PLAN: ASSIGNMENT OF RIGHTS

The Board of Directors, having heard the Remuneration Committee, resolved on the assignments to the beneficiaries of the rights relating to the 2023-2025 Performance Share Plan, established by resolution of the Shareholders’ Meeting of 27 April 2023.
Information regarding the beneficiaries and the number of rights assigned are shown – by name, for the beneficiaries who are members of the Board of Directors, and in aggregate form for the other beneficiaries – in the table attached, prepared in compliance with Box 1, Schedule no. 7 of Annex 3A of the Issuer Regulation. The terms and conditions of the Plan are set out in the Directors’ Explanatory Report to the Shareholders’ Meeting of 27 April 2023 and in the Information Document prepared pursuant to Article 84-bis, paragraph 1 of the Issuer Regulation, available on the website www.mondadorigroup.com Governance section and on the storage mechanism www.1info.it to the contents of which reference should be made.

PUBLICATION OF THE MINUTES OF THE SHAREHOLDERS’ MEETING

Arnoldo Mondadori Editore S.p.A. informs that the minutes of the Ordinary Shareholders’ Meeting held on 27 April 2023 are available on the authorised storage mechanism 1Info (www.1info.it), in the Governance section of the Company website www.mondadorigroup.com and at the Company’s registered office.

The Interim Management Statement at 31 March 2023 is made available by today through the authorised storage mechanism 1Info (www.1Info.it), on www.mondadorigroup.com (Investors section) and at the registered office.

The presentation of the results at 31 March 2023, approved today by the Board of Directors, is available on 1Info ( www.1info.it), on www.borsaitaliana.it and on www.mondadorigroup.com (Investors section). A Q&A session will be held in conference call mode at 4.00 pm for the financial community, attended by the CEO of the Mondadori Group, Antonio Porro, and the CFO, Alessandro Franzosi. Journalists will be able to follow the meeting in listening mode, by connecting to the following phone number +39.02.8020927 or via web at:  https://hditalia.choruscall.com/?calltype=2&info=company.

The Financial Reporting Manager – Alessandro Franzosi – hereby declares, pursuant to Article 154 bis, paragraph 2, of the Consolidated Finance Law, that the accounting information contained herein corresponds to the Company’s records, books and accounting entries.

[1]Source: GFK, March 2023 (Week 13)

[2] GFK, March 2023 (Week 13)

[3] GFK, March 2023 (ranking in terms of cover value)

[4] In accordance with IFRS15

Annexes (in the complete pdf):

1. Consolidated balance sheet;
2. Consolidated income statement;
3. Group cash flow;
4. Glossary of terms and alternative performance measures used.

Information pursuant to Schedule 7 of Annex 3a to CONSOB Regulation no. 11971/199

Today, the Shareholders’ Meeting of Arnoldo Mondadori Editore S.p.A., chaired by Marina Berlusconi, approved the financial statements for the financial year ended 31 December 2022.

The Group’s Chief Executive Officer, Antonio Porro, presented the key separate and consolidated figures for 2022, as disclosed to the market last 16 March.

The results achieved by the Group exceeded expectations, with both revenues and margins showing double-digit growth. Net profit, after minority interests, amounted to € 52.1 million, up 17.8% versus € 44.2 million in 2021. The Parent Company’s financial statements at 31 December 2022 show the same net profit as in the consolidated financial statements, due to the fact that the Company has chosen to use the equity method to measure its investments in the separate financial statements.

Today’s Shareholders’ Meeting, in accordance with the proposal of the Board of Directors of 16 March 2023, which has already been the subject of disclosure, resolved to distribute a unit dividend of € 0.11 for each ordinary share (net of treasury shares) outstanding at the record date, for a total of approximately € 28.7 million,^[1] up by almost 30% compared with the previous year: this amount corresponds to a pay-out of 55% of the net profit for 2022.
The dividend will be paid, in accordance with the provisions of the “Regulation of the markets organized and managed by Borsa Italiana S.p.A.”, from 24 May 2023 (payment date), with ex-coupon (No. 22) date on 22 May 2023 (ex date), and with the date of entitlement to payment of the dividend, pursuant to Article 83-terdecies of the TUF (record date), on 23 May 2023.

The Shareholders’ Meeting resolved also on the following additional items on the agenda:

Report on remuneration policy and compensation paid

Pursuant to Article 123-ter of Legislative Decree No. 58/1998, the Shareholders’ Meeting, by means of a binding resolution, approved Section One of the Report on Remuneration Policy and Compensation Paid. The Shareholders’ Meeting also voted in favour of Section Two of the Report.

Renewal of the authorization to purchase and sell treasury shares

Following expiry of the term relating to the previous authorization resolved on 28 April 2022, the Shareholders’ Meeting renewed the authorization to purchase and dispose of treasury shares with the aim of retaining for the Board of Directors the applicability of law provisions in the matter of any additional purchase plans and, consequently, of seizing any investment and operational opportunities involving treasury shares.
To date, Arnoldo Mondadori Editore S.p.A. holds a total of No. 1,147,991 treasury shares, equal to 0.44% of the share capital.
Here below is the information provided on the authorization issued by the Meeting, also with reference to the provisions of Article 144-bis of the Issuers’ Regulation No. 11971/1999.

Motivations

The motivations underlying the request for the authorization to purchase and sell treasury shares refer to the opportunity to attribute to the Board of Directors the power to:

• use the treasury shares purchased or already in the Company portfolio as compensation for the acquisition of interests within the framework of the Company’s investments;
• use the treasury shares purchased or already held in the portfolio against the exercise of option rights, including conversion rights, deriving from financial instruments issued by the Company, its subsidiaries or third parties and to use the treasury shares for lending, exchange or transfer transactions or to support extraordinary transactions on the Company’s capital or financing transactions that imply the transfer or sale of treasury shares;
• undertake any investments, directly or through intermediaries, including for the purpose of containing abnormal movements in share prices, stabilizing share trading and prices, supporting the liquidity of the share on the market, in order to foster the regular conduct of trading beyond normal fluctuations related to market performance, without prejudice in any case to compliance with applicable statutory provisions;
• rely on investment or divestment opportunities, if considered strategic by the Board of Directors, also in relation to available liquidity;
• dispose of treasury shares to service incentive plans based on financial instruments set up pursuant to Article 114-bis of the TUF, and plans for the free allocation of shares to employees or members of the governing bodies of the Company or to Shareholders.

Duration

The authorization to purchase treasury shares is set to last until the approval of the financial statements for the year ending 31 December 2023 and, in any case, for a period not exceeding 18 months after the Shareholders’ Meeting resolution, while the authorization to sell is granted to last for an unlimited period, given the absence of restrictions pursuant to the regulatory provisions in force and the opportunity to allow the Board of Directors to make use of the maximum flexibility, also in terms of time, to carry out the acts of disposal of the shares.

Maximum number of purchasable treasury shares

The authorization allows the purchase, including in more than one tranche, of ordinary shares of Arnoldo Mondadori Editore S.p.A., with a par value of € 0.26 each, on one or more occasions, in an amount freely determinable by the Board of Directors, up to a maximum number of shares – also taking into account the ordinary shares held, directly and indirectly, in the portfolio each time – of no more than 10% overall of the share capital.

Terms for purchasing treasury shares and indication of the minimum and maximum purchasing cap

Purchases shall be made in compliance with Articles 132 of the TUF and 144-bis, paragraph 1 letters b) and d-ter) of the Issuers’ Regulation and, therefore: (i) on regulated markets or multilateral trading facilities, according to the operating terms established in the organization and management regulations of the same markets, which do not allow the direct matching of buying trading proposals with pre-determined sale trading proposals, and also in compliance with any other regulations in force, including European regulations, (ii) in the terms established by the market practices admitted by CONSOB as per the combined provisions of Art. 180, paragraph 1, letter c) of the TUF and Art. 13 of EU Regulation No. 596 of 16 April 2014 (the “Admitted Market Practices”). Additionally, share purchase transactions may also be carried out in the terms envisaged in Article 3 of EU Delegated Regulation No. 2016/1052 in order to benefit, if the conditions are met, from the exemption under Article 5, paragraph 1, of EU Regulation No. 596/2014 on market abuse with regard to inside information and market manipulation.
Regarding the disposal of treasury shares, disposals may be made, on one or more occasions and even before having terminated the maximum number of purchasable treasury shares, either by selling them on regulated markets or according to other trading methods in compliance with the law, including EU law, in force and with the Admitted Market Practices, if applicable.
Under the proposed authorization, purchases shall be made at a unit price compliant with any regulatory provisions, including EU regulations, or Admitted Market Practices as applicable at the time and where applicable, without prejudice to the fact that the minimum and maximum purchase price shall be determined at a unit price not lower than the official Stock Exchange price of Mondadori shares on the day preceding the purchase transaction, reduced by 20%, and not higher than the official Stock Exchange price on the day preceding the purchase transaction, increased by 10%.
In any event – except for any different price and volume determinations resulting from the application of the conditions set forth in the Admitted Market Practices – such price shall be identified in accordance with the trading conditions set forth in Delegated Regulation (EU) No. 1052 of 8 March 2016.
In terms of consideration, sales transactions or other acts of disposal of treasury shares shall be carried out:

• if executed in cash, at a price no lower than 10% of the reference price recorded on the MTA – Euronext Milan – organized and managed by Borsa Italiana S.p.A. in the trading session prior to each single transaction;
• if executed as part of any extraordinary transactions, in accordance with financial terms to be determined by the Board of Directors on the basis of the nature and characteristics of the transaction, also taking account of the market performance of Mondadori shares;
• if executed to service the Performance Share Plans adopted by the Company, in compliance with the terms and conditions set out in the resolutions of the Shareholders’ Meeting that establish the Plans and the related regulations.

2023-2025 Performance Share Plan

The Shareholders’ Meeting, pursuant to Article 114-bis of Legislative Decree 58/1998 and in keeping with the introduction of performance share plans approved in the past for the medium/long-term remuneration of executive directors and key management personnel, approved the adoption of a Performance Share Plan for the three-year period 2023-2025 intended for the Chief Executive Officer, the CFO – Executive Director and a number of managers of the Company who have an employment and/or directorship relationship with the Company or its subsidiaries at the date of allocation of the shares.
For a detailed description of the 2023-2025 Performance Share Plan, the beneficiaries and the main characteristics of the Regulation of the Plan, reference should be made to the Information Document pursuant to Article 84 bis of CONSOB Issuers’ Regulation No. 11971/1999, and the explanatory report of the Board of Directors, available on the Company website www.mondadorigroup.com, Governance/Shareholders’ Meeting section and on the authorized storage mechanism 1Info (www.1Info.it).

^[1] Rough estimate based on the number of shares outstanding to date.

Arnoldo Mondadori Editore S.p.A. announces to have finalized today the closing of the disposal of its 18.45% equity stake in Società Europea di Edizioni S.p.A. to P.B.F. S.r.l., previously announced on 16 March last.

The sale consideration, to be settled entirely in cash, was set at 2.3 million euro, taking account of the price adjustment mechanism based on the company’s net financial position at the closing date.

The sale has generated a net capital gain of 0.5 million euro in the Mondadori Group income statement.
In financial year 2022, this stakeholding generated a loss of 1.8 million euro in the consolidated financial statements.

The sale is consistent with the Group strategy to focus on the books business and divest non-core assets.

Arnoldo Mondadori Editore S.p.A. announces that the following documents for the Annual General Meeting, to be held on 27 April 2023 in first call (28 April in second call, if any), are publicly available at the Company’s registered office, at the authorized storage mechanism 1info (www.1info.it) and on the website www.gruppomondadori.it (Governance section):

• the 2022 Annual Report, comprising the draft financial statements, the consolidated financial statements for the year ended 31 December 2022, the Directors’ Report on Operations (including the non-financial statement), the certifications pursuant to art. 154 bis, par. 5, of Legislative Decree no. 58/1998;
• the Independent Auditors’ reports and the Board of Statutory Auditors’ report;

Notice is additionally given that the summary statement pursuant to art. 2429 of the Italian Civil Code is also available at the registered office.

Arnoldo Mondadori Editore S.p.A. announces that the following documents are publicly available at the Company’s registered office, at the authorized storage mechanism 1info (www.1info.it) and on the website www.gruppomondadori.it (Governance section):

• the notice of call of the Ordinary Shareholders’ Meeting of Thursday 27 April 2023 in first call (28 April in second call, if any);
• the Directors’ explanatory report, in accordance with Article 125-ter of the TUF, on each of the items on the agenda;
• the Information Document prepared pursuant to Article 84-bis of the Issuer Regulation concerning the 2023-2025 Performance Share plan.
• the Report on remuneration policy and compensation paid (prepared pursuant to Article 123-ter of the TUF and 84-quater of the Issuer Regulation);
• the 2022 Report on corporate governance and ownership structure.

The additional AGM documentation will be made available, in the manners above, within the time limits of current laws.

Today, the meeting of the Board of Directors of Arnoldo Mondadori Editore S.p.A., chaired by Marina Berlusconi, reviewed and approved the draft financial statements and the consolidated financial statements at 31 December 2022 presented by CEO Antonio Porro.

2022 HIGHLIGHTS
The year 2022 saw the Group complete the strategic path of reshaping its business portfolio, which helped greatly ease its exposure to magazines while strengthening its foothold in book publishing, and will now continue with an exclusive focus on developing its core business.
During the year in fact, the Group completed a number of extraordinary transactions, the most noteworthy of which include:

• regarding the core business of Books, with a combined strategy of vertical integration in the supply chain and strengthening of its publishing leadership:
  • the acquisition of 50% of De Agostini Libri, active in Trade books with focus on the children’s and non-fiction segments, and the subsidiary Libromania, active in the promotion of third-party publishers;
  • the acquisition, with a view to strengthening the distribution of third-party publishers, of 50% of A.L.I. – Agenzia Libraria International, which will be fully consolidated as of 2023, following the acquisition of an additional 25% stake;
  • the acquisition of 51% of Star Comics, which makes the Group the Italian leader in the comic books segment.
• regarding the Print Media business, with a view to reducing exposure to the segment:
  • the disposal of a majority stake in Press-di, active in the nationwide distribution of magazines and newspapers;
  • the start of the disposal process of the business unit related to the Grazia and Icon brands, including the related international network, a transaction later completed in January 2023.

“In 2022 we achieved remarkable results, with double-digit growth in revenue and margins and the best net profit in the last 15 years. The performance as a whole – exceeding the guidance disclosed to the market – is clear proof of the success of the strategic repositioning of our businesses, the result of various acquisitions.
All this, combined with the many efficiency measures put in place by Management, has enabled us to further strengthen our operating-financial standing, despite a market and geopolitical scenario still dominated by uncertainty, marked among other things by a sharp increase in the cost of inputs”, stressed Antonio Porro, CEO of the Mondadori Group.

PERFORMANCE AT 31 DECEMBER 2022
Consolidated revenue amounted to € 903 million, growing by 11.8% versus 2021, despite the disposals in the Media area, thanks in particular to both the inclusion of D Scuola in the consolidation scope and the positive trend of the Books market, which benefited the Trade Books and Retail areas.

Adjusted EBITDA came to € 136.3 million, increasing by approximately € 31 million, or improving by 29%: one-third of this strong growth stems from the operating performance of the original scope, thanks to the increased efficiency achieved, and two-thirds from the consolidation of D Scuola.
Overall, profitability stood at 15.1%, up by 2 percentage points versus 2021.

EBITDA, which came to € 130.7 million versus € 91.1 million in 2021, improved even more (+43%), thanks to the operating trend and to the reduction in restructuring costs in the Media and Corporate areas versus the prior year.

EBIT, amounting to € 72.7 million, recorded a sharp improvement versus 2021 (+60.8%), despite the impact of higher amortization (€ 4.7 million) arising from the Purchase Price Allocation process of goodwill resulting from the concluded acquisitions (especially D Scuola).
EBIT in 2022 also includes a number of write-offs, totaling € 7.2 million (€ 7.4 million in 2021), resulting from the impairment process (relating in particular to the TV Sorrisi e Canzoni brand in the Media area, which was affected mainly by the increase in the discounting rates adopted).

Adjusted EBIT in 2022, net of extraordinary expense and all non-cash items related to Purchase Price Allocation and impairment processes, would amount to € 90.1 million, up by more than € 22 million versus the prior year.

Total financial expense for the period, amounting to € 5.7 million, increased by € 1 million, as a result of the Group’s higher average financial debt and the new evaluation of the earn-out from the acquisition of Hej! (€ 0.9 million).

The consolidated result before tax closed with a positive € 66.9 million versus € 38.6 million in 2021 (+73%).
Contributing to the strong increase of € 28.3 million was the improvement of € 1.3 million in the results of the associates resulting from the disposal on 1 January 2022 of the stake in Monradio and the start of the accounting of the share of profits of A.L.I., which more than offset the € 1.7 million write-down of the stake in Attica.

Net profit, after non-controlling interests, amounted to € 52.1 million, up by 18%, the best result achieved by the Group in the last 15 years; neutralizing the non-operating effects that impacted on 2021 and 2022, adjusted net profit would amount to € 64 million, up by more than 50%.

In addition to the buoyant performance of operations, the Group confirmed solid cash generation in the year, with Cash Flow from Ordinary Operations of € 70.2 million versus € 68.2 million in 2021.

The Net Financial Position (before IFRS 16) stood at € -106.1 million (€ -94.8 million in 2021); considering the effects of IFRS 16, the NFP stood at € -177.4 million, lower than € -179.1 million at December 2021, with a debt/Adjusted EBITDA ratio of 1.3x.
The minor change in the Net Financial Position between 2021 and 2022 shows – also looking ahead – the Group’s ability to self-finance, with its own cash generation, the active M&A policy implemented over the last year, preserving the ability to distribute dividends.

2022 saw, in fact, the return to a shareholder remuneration policy with the distribution of dividends totaling approximately € 22 million, equal to a pay-out of 50% of 2021 net profit.

At 31 December 2022, Group employees amounted to 1,900 units, up by 5% versus 1,810 units at 31 December 2021 (+90), due mainly to the inclusion of D Scuola staff (a total of 125 units).
Neutralizing the effect of all scope changes – namely, the acquisitions of D Scuola, De Agostini Libri and Star Comics, and the disposals of titles and assets in the Media area – the Group workforce would drop by approximately 1%, thanks to the continued efforts to increase the efficiency of individual corporate areas and functions.

BUSINESS OUTLOOK
The Group’s current setup, operating performance, and cash generation ability shown in 2022 allow us to estimate a further improvement in results for the new year, despite the continuing negative impacts of rising prices related to the purchase of raw materials and services.

From a strategic point of view, the Group intends to continue on the path of consolidating its core business and therefore its leadership in the Books area, from a publishing point of view, by strengthening the identity and specialization of the various publishing houses, and by pursuing the process of vertical integration of book chain activities. In the School textbooks segment, the Group will also complete the operational integration project of D Scuola.

In the Retail area, Mondadori will continue, on the one hand, the selective development of the network of stores functional to the completion of the widespread coverage of the Country, as well as the remodelling and downsizing of stores in order to optimize retail space and maximize network efficiency, and on the other, its efforts to focus on the book product in order to both increase the profitability of the area and to enhance its effectiveness in conveying the Group’s publishing proposition to the market.

In the Media area, the Mondadori Group will concurrently continue on the path of developing its digital skills and range of products, with particular regard to its presence on Social channels and influencer marketing.

Thanks to the financial and capital solidity achieved, the Group can continue on the virtuous path of development it embarked on a few years ago, pursued also through the continued use, especially in the books and digital businesses, of M&As, beneficial to the Group’s intention to continue to seize opportunities for inorganic growth.

Income Statement
The Group’s operating and financial targets that follow refer to a scope that includes only completed extraordinary transactions, therefore:

• in the Books area, full consolidation for the whole year of A.L.I. – Agenzia Libraria International, De Agostini Libri and Libromania (consolidated for 9 months in 2022), as well as Star Comics (consolidated for 6 months in 2022);
• in the Media area, deconsolidation for the whole year of Press-di and the print and digital operations referring to the Grazia and Icon

In light of the above and the relevant context, reasonable estimates for 2023 point to a:

• single-digit growth of revenue, in relation to which the above changes in the consolidation scope will have a neutral impact overall; the different business areas are in fact expected to show different trends: growth in the areas focused on the Book product, an increase in the Digital segment of the Media area, and, consistent with the structural downtrend of markets, a continued reduction in the Print Media business, which is expected at year-end to account for less than 10% of Group revenue;
• Single-digit growth of adjusted EBITDA. Even net of the recognition of relief to the museum business that benefited 2022 (approximately € 6.4 million), not planned however for 2023, adjusted EBITDA would grow high single-digit. Margins are likewise expected to grow – from 14% to 15% – thanks to:
  • targeted pricing policies,
  • careful cost containment policies,
  • completion of the operational integration of D Scuola,

and the Group is confident that it can more than offset the expected increase in costs for raw materials and services;

• the net result for 2023 is expected to grow by approximately 10% – despite higher amortization and depreciation resulting from both the Group’s policy of increasing investments and the effects of the Purchase Price Allocation process – due primarily to the absence of the write-down of certain balance sheet items, which is currently not expected to repeat in the new year.

Cash Flow and Net Financial Position
In 2023, the Group is expected to confirm the significant cash generation ability shown in recent years:

• Cash Flow from Ordinary Operations is expected to range from € 60 to € 65 million, up by as much as 10% versus 2022, net of the one-off impact of derivative instruments related to interest rate risk hedges;
• the Group’s net financial debt (IFRS 16) is expected to stand at 1.0x Adjusted EBITDA at end 2023, down versus 1.3x at end 2022.

Dividend Policy
Thanks to its solid financial and capital standing, the Group returns to a shareholder remuneration policy that will see the distribution of dividends in an annual amount equal to the greater of 40% of Cash Flow from Ordinary Operations and the dividend of the prior year.
Mention should be made that in 2024, from the result of 2023, the Board of Directors intends to propose the Shareholders’ Meeting to pay any dividend in two equal tranches (in May and November).
Each year, the Board of Directors, when proposing the distribution to the Shareholders’ Meeting, will in any case take account of the general macroeconomic scenario, as well as the expected cash flows that will affect the Group’s financial and capital structure.

AGREEMENT SIGNED ON DISPOSAL OF STAKE IN SOCIETA’ EUROPEA DI EDIZIONI
Today Arnoldo Mondadori Editore S.p.A. signed an agreement on the disposal to P.B.F. S.r.l. of the 18.45% stake held in Società Europea di Edizioni (SEE S.p.A.), publisher of the daily Il Giornale.
The provisional consideration for the transaction was set at € 3.7 million and includes an adjustment mechanism based on SEE’s net financial position and net working capital at the closing date, which is contractually scheduled by 30 June 2023. The accounting effects of the disposal will be defined and disclosed on completion of the transaction.
The disposal is consistent with the strategy of focusing on the books segment and on the divestment of non-strategic assets and investments.

PERFORMANCE OF BUSINESS AREAS

• BOOKS

Following the remarkable growth seen in 2021, 2022 witnessed a consolidation phase of the books market, which was basically steady in terms of value (+0.2%) and volume (-0.4%) versus 2021.
Breaking down this trend into the different segments that form the Trade publishing market, the stability seen is the result of a slight growth in the Trade segment in a narrow sense (+1.2%); a stronger increase by Comics (+7.5%), which continued to be the most dynamic segment even after the remarkable growth seen from 2019 to 2021; and a sharp decline in the Professional segment (-14.7%).

Against this backdrop, the publishing houses of the Mondadori Group recorded a growth in sell-out of 2.2% during the year, the result of a gradually improving performance.
Thanks to these results, the Mondadori Group was able to strengthen its domestic leadership with a growing market share, after as many as 5 years, reaching 27% at end 2022.

The School textbooks market (primary and secondary schools) in Italy in 2022 is estimated to increase by approximately 1% versus the prior year, settling at a total of approximately € 605 million; against this backdrop, the Group’s publishing houses recorded a basically steady sales/adoption ratio in secondary schools and achieved a 32.3% market share (including the share of D Scuola), down slightly versus the prior year: the decline is attributable to the primary school segment, marked by greater volatility and lower profitability, and to the reduction recorded by distributed publishers.

Revenue from the area in 2022 amounted to € 576.2 million, up by 23.9% (+7.4 excluding the contribution of D Scuola) versus the prior year, broken down as follows:

• +11.8% in the Trade area, driven by the positive performance of the publishing houses, with a contribution also from De Agostini Libri and Star Comics acquired during the year, along with the sharp upswing of Electa’s museum activities;
• +45.2% in the Education segment, thanks to the consolidation of D Scuola;
• +34.7% in service and distribution activities of third-party publishers, which benefited from the contribution of Libromania.

Despite higher paper purchase costs of over € 11 million, adjusted EBITDA in the Books area in 2022, including the contribution of D Scuola (€ 23.2 million), came to € 118.5 million, up by € 26 million versus 2021.
Profitability achieved by the Books area, amounting to approximately 21% in 2022, is higher than the figure recorded in 2021 (20%).

• RETAIL

The year 2022 saw the continued policy of developing and optimizing the physical network implemented in recent years. This transformation process resulted in improved operational and management performance.

During the year, the Retail area recorded revenue of € 189.2 million, an increase of € 15.3 million (+8.8%) versus 2021.

Ongoing store renovation and focus on the core business of books enabled the Mondadori Store network to consolidate its role on the market (with a 12.5% market share, up by 1.2% versus the prior year), thanks to the solid growth of Books revenue (€ +15.1 million).

Sales by channel show:

• further growth in revenue from directly-managed bookstores (+26.7% versus the prior year) and franchised bookstores (+4.3% versus the prior year);
• a decline in the online channel, after the growth in the previous two years, in line with the negative trend of the entire e-commerce market.

During the year, Mondadori Retail recorded significant growth in adjusted EBITDA, which stood at € 9.1 million (€ +4 million versus 2021).

• MEDIA

In 2022, the Mondadori Group completed the rationalization of its print portfolio, focusing on brands with the highest potential for multimedia development.

In 2022, the Media area revenue amounted to € 177.8 million, down by 13.9% versus 2021.

Excluding the effects of the deconsolidation of the titles sold at end 2021 and Press-di’s distribution business, revenue would have grown by +2%, broken down as follows:

• digital activities, which account for more than 27% of the area’s total revenue, rose sharply by 6% in 2022;
• traditional print activities were down by 4%.

The Media area’s adjusted EBITDA stood at € 14.1 million, growing by 14% versus the prior year, while margins improved by 2 percentage points (from 6% to 8%), attributable mainly to the curbing of operating costs as well as the recognition of a tax receivable of € 1.9 million.

PERFORMANCE OF ARNOLDO MONDADORI EDITORE S.P.A.
The Parent Company’s income statement at 31 December 2022 shows the same profit as in the consolidated financial statements of € 52.1 million (€ 44.2 million in 2021), due to the fact that the Company has chosen to use the equity method to measure its investments in the separate financial statements.
Revenue, which consists of the costs of central units charged back to subsidiaries, amounted to € 41.8 million, basically steady versus the prior year.
Adjusted EBITDA in 2022 came to € -5.7 million (€ -5.4 million in 2021), slightly deteriorating due to higher utility costs from the management of the Segrate HQ.
Reported EBITDA in 2022 stood at € -6.7 million, a sharp improvement versus 2021 (€ -11.4 million), thanks to lower provisions related to restructuring costs.

DIVIDEND DISTRIBUTION PROPOSAL OF € 0.11 PER ORDINARY SHARE
Based on 2022 results, the Board of Directors has proposed to the next Shareholders’ Meeting, convened on 27 April 2023, the distribution of a unit dividend of € 0.11 per ordinary share (net of treasury shares) outstanding at the record date.
Total dividends amounted to € 28.7 million, up by nearly 30% versus the prior year: this amount is equal to a pay-out of 55% of net profit in 2022 and a dividend yield of 6% (at 31 December 2022).
The dividend will be paid, in accordance with the provisions of the “Regulation of the markets organized and managed by Borsa Italiana S.p.A.”, from 24 May 2023 (payment date), with ex-dividend date (coupon no. 22) on 22 May 2023 (ex date) and with the date of entitlement to payment of the dividend, pursuant to Article 83-terdecies of the TUF (record date), on 23 May 2023.

SIGNIFICANT EVENTS AFTER YEAR-END 2022

On 10 January 2023, the Mondadori Group, through its subsidiary Mondadori Media S.p.A., executed the contract for the disposal to Reworld Media S.A. of the print and digital publishing operations of the Grazia and Icon titles, as well as the related international licensing network.
The execution of the transaction took place with the transfer of the business unit heading the operations disposed of to a newly-incorporated company and the concurrent disposal to Reworld Media of 100% of the share capital of the transferee.
On 13 January 2023, the Mondadori Group, through its subsidiary Mondadori Libri S.p.A., concluded the acquisition of a further 25% stake in A.L.I. S.r.l. – Agenzia Libraria International, operating in the distribution of books.
The transaction – which raised the Mondadori Group stake in A.L.I. to 75%, subject to full consolidation as of January 2023 – took place in execution of the agreements defined and disclosed on 11 May 2022 upon acquisition of an initial 50% stake, effective earlier than the date originally scheduled for 28 February 2023. The provisional price, paid entirely in cash, was approximately € 9.5 million and was determined, as already disclosed to the market, on the basis of an average 2021-2022 EBITDA and the positive net financial position (cash) of the scope covered by the transaction.
Additionally, the defined agreements gave the Mondadori Group the right to acquire the remaining 25% in A.L.I., at a price to be determined on the basis of an average 2023-2024 EBITDA, through put&call options exercisable by 30 July 2025.

PROPOSED RENEWAL OF THE AUTHORIZATION TO PURCHASE AND DISPOSE OF TREASURY SHARES
Following expiry of the previous authorization resolved upon by the Shareholders’ Meeting on 28 April 2022, with the approval of the financial statements at 31 December 2022, the Board of Directors will propose to the next Shareholders’ Meeting the renewal of the authorization to purchase and dispose of treasury shares with the aim of retaining the applicability of law provisions in the matter of any additional buyback plans and, consequently, of seizing any investment and operational opportunities involving treasury shares.

Below are the key elements of the Board of Directors’ proposal:

• Motivations
  The motivations underlying the request for the authorization to purchase and dispose of treasury shares refer to the expediency to grant the Board of Directors the power to:
  • use the Treasury Shares purchased or already in the Company portfolio as compensation for the acquisition of interests within the framework of the Company’s investments;
  • use the treasury shares purchased or already held in portfolio against the exercise of option rights, including conversion rights, deriving from financial instruments issued by the Company, its subsidiaries or third parties and to use the treasury shares for lending, exchange or transfer transactions or to support extraordinary transactions on the Company’s capital or financing transactions that imply the transfer or sale of treasury shares;
  • undertake any investments, directly or through intermediaries, including for the purpose of containing abnormal movements in share prices, stabilizing share trading and prices, supporting the liquidity of the share on the market, in order to foster the regular conduct of trading beyond normal fluctuations related to market performance, without prejudice in any case to compliance with applicable statutory provisions;
  • rely on investment or divestment opportunities, if considered strategic by the Board of Directors, also in relation to available liquidity;
  • dispose of treasury shares to service share-based incentive plans set up pursuant to Article 114-bis of the TUF, and plans for the free allocation of shares to employees or members of the governing bodies of the Company or to Shareholders.

• Duration
  The authorization to purchase treasury shares runs from the date of any resolution approving the proposal by the Shareholders’ Meeting, until the Shareholders’ Meeting called to approve the financial statements at 31 December 2023 and, in any case, for a period no more than 18 months after such date.
  The authorization to dispose of treasury shares is requested for an unlimited period, given the absence of time limits pursuant to current regulations and the opportunity to allow the Board of Directors to make use of the maximum flexibility, also in terms of time, to carry out any disposal of shares.

• Maximum number of purchasable treasury shares
  The authorization would allow the purchase, on one or more occasions and also in several tranches, of a maximum number of ordinary shares with a par value of € 0.26 per share, which – taking account of the treasury shares already held by the Company and any shares that may be acquired by subsidiaries – would not exceed a total of 10% of the share capital.
  In accordance with Article 2357, paragraph 1, of the Italian Civil Code, purchase transactions shall be carried out within the limits of the distributable profits and available reserves resulting from the last duly approved financial statements at the time each possible purchase transaction is carried out. The authorization would include the option to subsequently dispose of the treasury shares purchased, in whole or in part, on one or more occasions and even before having reached the maximum number of purchasable shares.

• Criteria for purchasing treasury shares and indication of the minimum and maximum purchasing cap
  The purchases would be made in compliance with Articles 132 of the TUF, 144-bis, paragraph 1, letters b) and d-ter) of the Issuer Regulation, and so:
  –  on regulated markets or multilateral trading systems, according to the operating criteria established in the organization and management regulations of the same markets, which do not allow the direct matching of buy orders against predetermined sell orders, and also in compliance with any other applicable law, including EU law.
  –  in the manner established by the market practices permitted by CONSOB, as per the combined provisions of Article 180, paragraph 1, lett. C) of the TUF, and Article 13 of Regulation (EU) no. 596 of 16 April 2014 (the “Permitted Market Practices”).
  Additionally, share purchase transactions may also be carried out in the manner envisaged in Article 3 of EU Delegated Regulation no. 2016/1052 in order to benefit, if the conditions are met, from the exemption under Article 5, paragraph 1, of EU Regulation no. 596/2014 on market abuse with regard to inside information and market manipulation.
  The disposal of treasury shares may be made, on one or more occasions and even before having reached the maximum number of purchasable treasury shares, either by selling them on regulated markets or according to other trading methods in compliance with the law, including EU law, in force and with the Admitted Market Practices, if applicable. The proposed authorization envisages that purchases shall be made at a unit price, in compliance with any regulatory requirements, including Community ones, or Admitted Market Practices pro tempore in force, if applicable, it being understood that the minimum and maximum purchase price shall be determined at a unit price no lower than the official Stock Exchange price of Mondadori shares on the day before the purchase transaction, reduced by 20%, and not higher than the official Stock Exchange price on the day before the purchase transaction, increased by 10%. In any event – except for any different price and volume determinations resulting from the application of the conditions set forth in the Admitted Market Practices as defined in Point 6 below – such price shall be identified in accordance with the trading conditions set forth in Delegated Regulation (EU) no. 1052 of 8 March 2016 and, in particular:
  • no shares may be purchased at a price higher than the higher between the price of the last independent trade and the price of the highest current independent bid on the trading venue where the purchase is carried out; and
  • in terms of volumes, daily purchase amounts shall not exceed 25% of the daily average volume of Mondadori shares recorded over the 20 trading days before the dates of purchase, or in the month prior to the month of the notice required by Article 2, paragraph 1, of Regulation (EU) no. 1052/2016.
  • In terms of consideration, sales transactions or other acts of disposition of treasury shares shall be carried out:
  • if executed in cash, at a price no lower than 10% of the reference price recorded on the MTA – Euronext Milan – organized and managed by Borsa Italiana S.p.A. in the trading session prior to each single transaction;
  • if executed as part of any extraordinary transactions in accordance with financial terms to be determined by the Board of Directors on the basis of the nature and characteristics of the transaction, also taking account of the market performance of Mondadori shares;
  • if executed to service the Performance Share Plans as referred to in point 1 above in compliance with the terms and conditions set out in the resolutions of the Shareholders’ Meeting that establish the Plans and the related regulations.

To date, Arnoldo Mondadori Editore S.p.A. holds a total of no. 1,147,991 treasury shares, equal to 0.440% of the share capital.
For further information on the proposed authorization for the purchase and disposal of treasury shares, reference should be made to the Directors’ Explanatory Report, which will be published within the time limits and in the manner prescribed by applicable regulations.

GRANTING OF SHARES UNDER THE 2020-2022 PERFORMANCE SHARE PLAN: INFORMATION PURSUANT TO ARTICLE 84-BIS, PARAGRAPH 5 CONSOB REGULATION NO. 11971/1999
The Board of Directors, based on the final assessment of the Performance Targets underlying the Plan, and having heard the Remuneration and Appointments Committee, resolved to allocate a total of no. 461,189 Arnoldo Mondadori Editore S.p.A. shares to 9 beneficiaries, in implementation of the provisions contained in the “2020-2022 Performance Share Plan” established by the Board of Directors on 17 March 2020 and subsequently adopted by the Shareholders’ Meeting on 22 April 2020 (the “2020-2022 Plan”).
Mention should be made that the 2020-2022 Plan takes the form of a share granting plan and grants its beneficiaries the right to receive, free of charge, shares in the Company provided that, at the end of a reference period of three financial years, the performance targets set in the same Plan have been achieved.
The 9 beneficiaries of the 2020-2022 Plan are the Chief Executive Officer, the CFO and 7 managers identified by name by the Chief Executive Officer, as delegated by the Board of Directors.
The characteristics of the 2020-2022 Plan are explained in detail in the Directors’ Report to the Shareholders’ Meeting of 22 April 2020 and in the information document contained therein, available on www.gruppomondadori.it, Governance section, to which reference should be made.
Attached is the information required by Schedule 7 of Annex 3A to CONSOB Regulation no. 11971/1999 to account for the granting of shares in the context of the 2020-2022 Performance Plan.

PROPOSED ADOPTION OF A 2023-2025 PERFORMANCE SHARE PLAN
The Board resolved, on a proposal from the Remuneration and Appointments Committee, and in keeping with the introduction of the performance share approved last year for the medium/long-term remuneration of executive directors and key management personnel, to submit to the approval of the Ordinary Shareholders’ Meeting, the adoption of a 2023-2025 Performance Share Plan, in accordance with Article 114-bis of Legislative Decree no. 58 of 24 February 1998, intended for the Chief Executive Officer, the CFO – Executive Director and a number of Company managers who have an employment and/or directorship relationship with the Company or with its subsidiaries on the granting date of the shares.
With the adoption of the Plan, the Company aims to encourage Management to improve medium to long-term performance, in terms of both industrial performance and growth in the value of the Company.
The Plan envisages the assignment to the beneficiaries of rights to the free allocation of company shares, subject to the achievement of specific performance targets set and measured at the end of the three-year performance period.
These targets are structured to include both shareholder remuneration indicators and management indicators functional to raising the share value, ensuring maximum alignment of Management remuneration and the creation of value for the Company, as well as indicators of a non-operating/financial nature.
For details on the proposed adoption of the 2023-2025 Performance Share Plan, the beneficiaries and the main characteristics of the Regulations of the Plan, reference should be made to the Information Document drawn up by the governing body, pursuant to Article 84-bis and annex 3A of the Issuer Regulation, and to the Explanatory Report, which will be published within the time limits and in the manner prescribed by applicable regulations.

CONSOLIDATED NON-FINANCIAL STATEMENT PURSUANT TO LEGISLATIVE DECREE 254/2016
Under Legislative Decree 254/2016, the Board of Directors’ 2022 Report on Operations of the Mondadori Group is also composed of the Consolidated Non-Financial Statement (NFS), a qualitative-quantitative description of the non-financial performance of the Company, associated with environmental, social, and staff-related issues, as well as those regarding respect for human rights, and the fight against corruption and bribery, which are relevant given the activities and characteristics of the Company. The NFS was prepared in accordance with GRI Standards: In accordance option, and includes benchmark KPIs related to GRI G4 “Media Sector Disclosure”.
With regard to 2022, the Mondadori Group has updated its materiality analysis, consistent with the principles set out by the GRI Sustainability Reporting Standards (GRI Standards) and the reporting scopes laid down by Legislative Decree 254/2016.
In order to continuously improve the process, stakeholder engagement activities were further expanded in 2022 with the engagement not only of employees, teachers, and bookstore customers, but also of suppliers, financial analysts and investors, with more than 9,500 total answers to the engagement questionnaire.
The document also contains relevant information in line with ESMA’s recommendations for the 2022 reporting year, and includes references required by Regulation (EU) 2020/852 related to the recent introduction of the EU Taxonomy.

In the reporting area, the following are the actions and initiatives taken:

• D&I: synergistic work with all corporate departments and implementation of the indicator system;
• training and development in digital and business innovation: > 40,000 hours;
• education and the school world: approximately 5,000 teachers involved in stakeholder engagement;
• COVID prevention and protection actions for employees and associates;
• energy efficiency actions, reducing gas consumption by 25.2%.

During the year no cases of corruption or bribery involving the Company or its employees were reported, and no legal action was initiated or concluded against the Group or its employees for cases of corruption or reports made within the whistleblowing system.
In 2022, the Mondadori Group once again paid special attention to environmental issues, the specific impacts associated with the life cycle of paper products, and the reduction of climate-changing emissions: this is an approach that guides the Company in the implementation of its activities, from the purchase of certified paper to the efficient management of points of sale and property.

SUSTAINABILITY PLAN GUIDELINES
The Mondadori Group launched its first three-year Sustainability Plan in 2022, which identifies strategic areas, quantitative and qualitative targets, and short- and medium-term actions for the ongoing improvement of performance in social, governance, and environmental terms. The Group’s identity, mission and role as a publisher are reflected in the 3 macro areas and respective guidelines identified, consistent with the global goals of the United Nations.
2022 was a year marked by the constant monitoring of the quantitative goals set, which helped, on the one hand, to accurately record the level of their achievement and, on the other, to identify new future actions for a continuous updating of the Plan.

The goals achieved are as follows:
Social: enhancing people, content and places for education and culture

1. Development and endorsement of a well-structured framework of KPIs for monitoring all D&I-related actions, with specific regard to the gender pay gap and gender balance;
2. Extension to 100% of the school proposition of content/insights in the areas of Sustainability, 2030 Agenda for Sustainable Development, diversity, equity and inclusion, and civic education (80% in 2022; 100% in 2023);
3. Development of the Hybrid working project for the shared definition of a new mixed working model;
4. Ad hoc training in D&I for all Group people;
5. Enhancement of the initiatives/services proposition for the promotion of reading, and ESG training for the Group’s school textbooks editorial offices and teachers.

Governance: promoting sustainable business success

1. Definition and measurement of quantitative and measurable LTI goals related to ESG issues for Top Management (Impact Inclusion Index in the 2022-2024 Performance Share plan).
2. Strengthening of the set of procedures and coverage of the areas of Privacy, Information Management and Cyber Security.
3. Strengthening of programs for protecting intellectual property/copyrights.
4. Enhancement of Stakeholder Engagement activities through the gradual expansion of engagement initiatives.

Environment: disseminating environmental culture and mitigating impacts on ecosystems

1. Extension to 100% of the school proposition of insights and fact sheets dedicated to the environmental culture of the entire school textbooks proposition, and promotion of such content within the Trade range (80% in 2022; 100% in 2023).
2. Fulfilment of ≈100% purchase of PEFC/FSC certified paper for Mondadori Group products.
3. Pursuit of energy efficiency actions, also as part of building/property and store renovation initiatives, and assessment of additional potential pilot activities to reduce greenhouse gas emissions.
4. Launch of the Book Environmental Footprint Life-Cycle Assessment project to measure environmental impacts and setting of “data-based” targets on the reduction of emissions into the atmosphere for ongoing improvement throughout the value chain.

The results for the year ended 31 December 2022, approved on today’s date by the Board of Directors, will be presented by the Mondadori Group Management to the financial community in a webcast presentation scheduled today at 3:30 PM.
The corresponding documentation will be available on 1Info (www.1info.it), www.borsaitaliana.it and www.gruppomondadori.it (Investors). Journalists will be able to follow the presentation in listening mode only, by connecting to the following telephone number +39028020911 and via web https://www.c-meeting.com/web3/join/M37DCPDPQUB3KL. At the end of the meeting, a dedicated session is scheduled where questions may be submitted to management.

The Financial Reporting Manager – Alessandro Franzosi – hereby declares, pursuant to Article 154 bis, paragraph 2, of the Consolidated Finance Law, that the accounting information contained herein corresponds to the Company’s records, books and accounting entries. 

Annexes (in the pdf complete):

1. Consolidated balance sheet;
2. Consolidated income statement;
3. Consolidated income statement – fourth quarter;
4. Group cash flow;
5. Arnoldo Mondadori Editore S.p.A. balance sheet;
6. Arnoldo Mondadori Editore S.p.A. income statement;
7. Arnoldo Mondadori Editore S.p.A. statement of cash flows;
8. Glossary of terms and alternative performance measures used;

Information pursuant to Schedule 7 of Annex 3a to CONSOB Regulation no. 11971/1999

Arnoldo Mondadori Editore S.p.A. today announced, as per Art. 2.6.2 of the regulations governing markets organised and managed by Borsa Italiana S.p.A., the corporate events scheduled for 2023:

• Thursday 16 March 2023: meeting of the Board of Directors for the approval of the Annual Report for the year ended 31 December 2022;
• Wednesday 10 May 2023: meeting of the Board of Directors for the approval of the Interim Management Statement at 31 March 2023;
• Tuesday 1 August 2023: meeting of the Board of Directors for the approval of the Half-Year Report at 30 June 2023;
• Wednesday 8 November 2023: meeting of the Board of Directors for the approval of the Interim Management Statement at 30 September 2023.

The Annual General Meeting of the Shareholders for the approval of the Annual Report for the year ended 31 December 2022 will be held on first calling on Thursday 27 April 2023 (Friday 28 April in second call, if any).

Presentations to the financial community of the results for the full year at 31 December 2022, the Half-Year Report at 30 June 2023 and the Interim Management Statements at 31 March 2023 and at 30 September 2023 will be held on the dates, as indicated above, of the respective meetings of the Board of Directors.

Any changes will be promptly communicated to the market.

Mention should be made that Arnoldo Mondadori Editore S.p.A., as a company listed on the Euronext STAR segment of Borsa Italiana, will publish the Interim Management Statements at 31 March 2023 and at 30 September 2023 – pursuant to art. 2.2.3, par. 3, of the Borsa Italiana Regulations – within 45 days after the end of the first and third quarters of the year (with exemption from the publication of the interim report on the fourth quarter if the annual financial report 2022, together with the other documents referred to in art. 154-ter, par. 1, of the Finance Consolidation Act, is made available within 90 days after year end).
The structure, information and procedures for the publication of the documents are unchanged from the Interim Management Statements previously published pursuant to former Article 154-ter, paragraph 5, of the Finance Consolidation Act.