Codere S A : 26/02/2021 Q4 2020 Earnings release

FY 2020 Earnings Results

February 26, 2020

Table of Contents

Financial and Operating Overview .....................................................................................3

Consolidated Income Statement .........................................................................................4

Revenue and Adjusted EBITDA ..........................................................................................6

Earnings per Share ...............................................................................................................6

Revenue and Adjusted EBITDA at Constant Currency ....................................................7

Operating Expenses .............................................................................................................8 Income Statement by Country

Mexico ..........................................................................................................................9

Argentina ...................................................................................................................10

Spain ..........................................................................................................................11

Italy .............................................................................................................................12

Other Operations ......................................................................................................13

Consolidated Cash Flow Statement .................................................................................14

Capital Expenditures and Acquisitions ...........................................................................16

Consolidated Balance Sheet .............................................................................................17

Net Working Capital ............................................................................................................18

Capitalization .......................................................................................................................19

Gaming Capacity by Venue ...............................................................................................20

Gaming Capacity by Product ............................................................................................21

Recent Events ......................................................................................................................22

Contact Information ............................................................................................................24

Financial and Operating Overview

Herein, figures presented above Operating Profit (other than non-recurring items and impairment charges) are shown excluding the impact of non-recurring items as well as the impact resulting from the application of IAS 29.

Adjusted EBITDA refers to EBITDA1 excluding all non-recurring items and not considering Argentine figures according to IAS 29 standards (inflation accounting). All figures are post the application of IFRS 16.

Following the October 12, 2020, amendment to IFRS 16 Leases: Covid 19-Related Rent Concessions by the IASB regarding the accounting for a concession, in the form of forgiveness or deferral of lease payments, as a negative variable lease payment instead of as financial income, we have adjusted retroactively our Q2 2020 reported rental expense to reflect this new approach. As a result, we have deducted €7.4 mm from financial income in the period

and accounted for it as lower rental expense, positively impacting EBITDA. For a detailed breakdown of this adjustment by country please see the Recent Events section at the end of this report.

• • FY 2020 Operating Revenue decreased by 57.2% to €594.6 mm as a result of the COVID-19 related closings and operational restrictions. Our entire retail operation was shuttered during most of Q2, with reopenings taking place progressively during Q3 but offset again by additional closings and operational restrictions towards the end of the year.

• • FY 2020 Adjusted EBITDA reached €22.5 mm, 92.9% below FY 2019, driven by a negative EBITDA of €23.7 mm in Q2 due to the abovementioned closings, already turning positive in Q3 thanks to the positive contributions from

  Spain, Italy, Online and Uruguay. In Q4, Adjusted EBITDA became again negative (€6.1) mm as a result of the temporary closings in some regions and countries as well as further delays in the reopening of Argentina and the State of Mexico.

• • FY 2020 Adjusted EBITDA margin declined to 3.8%, 19.2 percentage points below FY 2019 due to the lack of revenues not being offset by the decline in operating expenses, despite the implementation of significant cost cutting and efficiency measures in the period. Some of these measures will help us improve our margins upon business normalization in future quarters.

• • In FY 2020 we generated a net loss of €236.6 mm, compared to a loss of €61.7 mm last year, mainly as a result of the closings related to COVID-19, and, to a lesser extent, the devaluation of our operating currencies vs. the

  USD, partially offset by the accounting implications of the refinancing transaction closed on October 30, 2020.

• • Capex in FY 2020 was €37.6 mm, 58.5% below FY 2019, and included €31.5 mm of maintenance capex and €6.1

  mm for growth projects.

• • As of December 31, 2020, we had €110.3 mm in cash and equivalents vs €103.1 mm as of December 31, 2019

  (€145.5 mm including SSRCF availability). Our gross debt amounted to €1,020.6 mm and our net debt to €910.3 mm, or €1,228.9 mm and €1,118.6 mm, respectively, including capitalization of operating leases (as per IFRS 16).

  The higher than expected cash position by year end is mainly driven by the deferral of gaming taxes (€31.8mm in PREU) by Italian authorities from December to the first half of 2021. However, the increased number of closings and operating restrictions, as well as the partial payment of some deferred expenses in January, reduced our liquidity position to €85.6 mm in January.

  As explained in the Recent Events section, based on the abovementioned closings and pressure on liquidity which is expected to continue during the year, the Company has engaged financial advisors to analyze alternatives to enhance its liquidity and strengthen its capital structure.

• • In terms of gaming capacity, our active number of slots by December 31, 2020, was 23,074 (around 41% of our capacity by year end 2019), deployed across all markets except Italy. In terms of venues, we had 79 gaming halls in operation, 1,049 arcades, 153 sports betting shops and 5,410 bars. These figures do not include further halls that are temporarily closed in Mexico, Panama and Colombia and the temporary closing of bars in certain regions in Spain in January.

1 EBITDA, as defined by the Company, is operating profit (EBIT) plus depreciation and amortization, variation in provisions for trade transactions, gains / (losses) on asset disposals, and impairment charges.

Consolidated Income Statement1

Figures in EUR mm, except where noted otherwise

Operating Revenue

Gaming & Other Taxes Personnel

Rentals

Cost of Goods Sold Other

Operating Expenses (excl. D&A)

Depreciation & Amortization

Variation in Provisions for Trade Transactions(1)

Gains / (Losses) on Asset Disposals (2)

Impairment Charges

Non-Recurring Items

Operating Profit (Pre-Inflation Accounting)

Inflation Adjustment on Operating Expenses (3,4)

Operating Profit (Post-Inflation Accounting)

Interest Expense

Interest Income

Gains / (Losses) from Financial Investments Gains / (Losses) from Exchange Rate Variations Inflation Adjustment(5)

Earnings before Corporate Income Taxes

Provision for Corporate Income Taxes Inflation Adjustment on CIT(6)

Minority Interests in Subsidiary (Income) / Loss Equity in Affiliate Income / (Loss)

Net Income / (Loss)

EBITDA

1 Figures reflect change in provisions on advances to site owners in connection with contracts to install our machines in their establishments.

• 2 Figures primarily reflect disposal of gaming machines;

• 3 Figure reflects, following IAS 29, the net impact on revenues and costs above EBITDA from applying Argentinean inflation to the end of the reporting period on the accrued items and ARS/EUR exchange rate as of December 31, 2020.

4 Figure reflects, following IAS 29, the net impact on costs above Operating Profit from applying Argentinean inflation to the end of the period on the accrued items and ARS/EUR exchange rate as of December 31, 2020, excluding impact on items above EBITDA.

• 5 Figure includes the impact from applying end of period inflation on fixed assets.

• 6 Figure includes the impact of inflation accounting on corporate income tax in Argentina.

• • Operating Revenue decreased by €794.8 mm or 57.2% to €594.6 mm in FY 2020, due to the COVID-19 related closings. The most significant decreases took place in Argentina (€246.5 mm as it was the only market that remained fully closed between March and December), Mexico (€209.9 mm) and Italy (€188.6 mm).

• • Operating Expenses (excluding depreciation and amortization) decreased by €498.3 mm or 46.6% to €572.1

  mm, as a result of reductions across variable costs in all our markets and to the multiple temporary cost containment measures deployed by management, especially in Argentina (€163.2 mm), Italy (€156.1 mm),

  Mexico (€91.8 mm) and Spain (€43.1 mm).

• • Adjusted EBITDA decreased by €296.5 mm to €22.5 mm in FY 2020, as a result of the decrease in revenue and the closings affecting all of our markets. The significant revenue decline in our retail operations was only partially offset by the reduction in costs, as the volatility in the openings, closings and operational restrictions made it difficult to align fixed costs to revenue generation.

• • Non-Recurring Items in FY 2020 were €28.3 mm (€6.6 mm of which were related to the refinancing process)

  while marketing investments to grow our online business accounted for an additional €14.3 mm.

• • Inflation Adjustment in FY 2020 represents a loss of €0.6 mm (impact on EBITDA). At the net income level, the impact is a net loss of €7.1 mm.

• • Impairment Charges in FY 2020 amounted to €2.0 mm.

• • Operating Profit (prior to considering inflation accounting for Argentina) decreased by €287.7 mm to an operating loss of €193.4 mm in FY 2020.

• • Interest Expense (including financial expenses from capitalized operating leases) increased by €9.8 mm to €120.5 mm driven by the incremental interest on the newly issued €250 mm super senior secured notes.

• • Interest Income increased by €57.4 mm to €62.5 mm as a result of the €60.3 mm interest income in Q4 related to the accounting treatment of the refinancing transaction, whereby the amended and restated notes are considered, for accounting purposes, as new debt, and therefore registered at fair value upon completion of the transaction (October 30, 2020).

• • Gains on Financial Investments reached €5.1 mm in FY 2020 vs a loss of €2.1 mm in 2019.

• • Losses on Exchange Rate Variations reached €16.4 mm in FY 2020 derived from the appreciation of the USD against our LATAM operating currencies in the beginning of the year, although the trend partially reversed since Q2 and more meaningfully in Q4.

• • Provision for Corporate Income Tax decreased by €27.4 mm to €13.2 mm in FY 2020 driven by significant decreases in accrued corporate income taxes as a result of the reduction of profit before taxes in all of our business units (especially in Argentina), and reduced withholding taxes payments across the Group.

• • Minority Interest represents a gain of €20.3 mm in FY 2020.

• • As a result of the aforementioned results, the Net Loss in FY 2020 was €236.6 mm, compared to a Net Loss of €61.7 mm in FY 2019.

Revenue and Adjusted EBITDA

Earnings per Share

1 Figure excludes treasury shares.

1

Revenue and Adjusted EBITDA at Constant Currency

Figures in EUR mm, except where noted otherwise

Argentina

Mexico

Panama

Uruguay

Colombia

Sub-Total - Latin America

Sub-Total - Europe

Total

Italy

Spain

Online

• 75.9 8.5 (88.8%)

• 73.3 31.2 (57.5%)

• 20.3 8.6 (57.5%)

• 18.8 14.5 (22.8%)

• 4.7 4.1 (12.9%)

• 89.0 22.6 (74.7%)

• 47.6 32.2 (32.3%)

54.8 (59.9%)

22.8 144.4

Argentina

Mexico

Panama

Uruguay

Colombia

Sub-Total - Latin America

Italy

Spain

Sub-Total - Europe

Online Total

Corporate

• 6.4 3.2 (50.6%)

• 1.6 1.0 (37.5%)

(7.0)

(3.4) 2.9

(0.5)

(4.2) 3.4

(8.3)

n.a.(78.7%)

n.a.

Operating Expenses1

Figures in EUR mm, except where noted otherwise

Operating Revenue

Gaming & Other Taxes

Personnel

Rentals

Cost of Goods Sold

Other

Operating Expenses (excl. D&A)

T otal

Gaming Taxes

Other Taxes

• (32.1) 68.9%

• (10.2) 49.9%

Rentals

Gaming Venues & Other

T otal

Slots

• (0.0) 98.0%

• (0.2) 98.0%

Other

Professional Fees(2)

Advertising and Marketing

Utilities

Repairs & Maintenance(3)

T otal

Insurance(4)

Travel

Transportation(5)

Other Expenses

• (4.0) 7.4%

• (6.4) 41.7%

• (6.6) 47.9%

• (2.8) 44.0%

• (1.1) (46.6%)

• (0.8) 34.9%

• (0.4) 35.9%

• (24.9) (7.3%)

Operating Revenue

Gaming & Other Taxes

Personnel

Rentals

Cost of Goods Sold

Other

Operating Expenses (excl. D&A)

T otal

Gaming Taxes

Other Taxes

• 24.0% (6.0)

• 31.6% (4.3)

Rentals

Gaming Venues & Other

T otal

Slots

• 0.0% (0.6)

• 0.2% (2.8)

• 0.2% (3.4)

Other

Professional Fees(2)

Advertising and Marketing

Utilities

Repairs & Maintenance(3)

Insurance(4)

Travel

Transportation(5)

Other Expenses T otal

4.8%

4.9%

2.1%

0.9%

0.6%

0.3%

• 18.5% 11.8

35.2%

• 1 Figures exclude non-recurring items.

  29.7%	0.9
  5.9%	1.1
  35.7%	37.7%	2.0

  0.6%	(0.6)
  2.3%	(2.4)
  2.8%	-0.1%	(3.0)

  1.1%	1.0
  2.6%	0.7
  2.7%	1.2
  1.2%	0.2
  0.2%	0.3
  0.2%	0.1
  0.2%	0.1
  9.5%	5.5
  17.7%	26.7%	9.0

• 2 Figures exclude payments to personnel via outsourcing agreements in Mexico which are re-classified as personnel expense.

• 3 Includes cleaning services and general supplies consumed.

• 4 Includes insurance (including surety bonds) premiums and letter of credit fees.

• 5 Includes armored vehicles for route collections and other transportation costs.

Operating Revenue

Gaming & Other Taxes

Personnel(1)

Rentals

Cost of Goods Sold

Other

Operating Expenses (excl. D&A)

Depreciation & Amortization

Variation in Provisions for Trade Transactions

Gains / (Losses) on Asset Disposals(2)

Impairment Charges

Non-Recurring Items

Operating Profit

EBITDA EBITDA Margin

Adjusted EBITDA Adjusted EBITDA Margin

Average Exchange Rate - EUR/MXN

Average Inflation (YoY)

25.9 35.3%

(3.3) n.a.

25.0 34.1%

(1.1) n.a.

24.49 3.5%

Avg. Installed Capacity (Slots)

EUR

Local Currency

661 (0.2%)

• • Operating Revenue in FY 2020 decreased by €209.9 mm (68.2%) compared to FY 2019 due to the closing of all of our gaming halls in the country during the second quarter and only partial reopening during the third and fourth one (39 halls opened as of December 31).

• • Operating Expenses (excluding D&A) decreased by €91.8 mm (48.1%) in FY 2020 mainly as a result of our significant efforts to reduce and defer personnel expenses, rentals and other fixed costs. Given the absence of government support programs for furloughed employees we provided partial compensation to our employees during the closings, resulting in modest savings in personnel costs relative to the revenue decline.

• • Adjusted EBITDA decreased by €118.1 mm to negative €1.1 mm as a result of the significant decline in revenues due to the closings which resulted in positive EBITDA generation only in Q1.

• • As of December 31, the number of halls in operation had decreased to 39 from 61 in September (after the closing, among others, of those in Mexico City). Still, most of our halls are operating under different capacity, opening hours and/or age restrictions as defined in each specific state. As of February 24, we have 44 halls in operation.

• 1 Includes personnel costs related to outsourced employees.

• 2 Figures reflect primarily disposal of gaming machines.

Argentina

1

Figures in EUR mm, except where noted otherwise

Operating Revenue

• Gaming & Other Taxes (33.8) (3.5)

• Personnel (12.8) (5.8)

• Rentals (1.1) (0.3)

• Cost of Goods Sold (1.4) (0.0)

• Other (6.9) (2.1)

Operating Expenses (excl. D&A)

Depreciation & Amortization (2.1) (1.5)Variation in Provisions for Trade Transactions Gains / (Losses) on Asset Disposals (1) Impairment Charges

Non-Recurring Items (1.0) (0.1)

Operating Profit (Pre-Inflation Accounting)

Inflation Adjustment on Operating Expenses(2)

Operating Profit (Post-Inflation Accounting)

EBITDA

EBITDA Margin

Adjusted EBITDA EBITDA

(+) Non-Recurring Items

(+) Inflation Adjustment on EBITDA(2)

Adjusted EBITDA

Adjusted EBITDA Margin

Average Exchange Rate - EUR/ARS

5.9

(56.0)

(11.7)

0.0 0.0 (0.2) 0.0 0.0 0.0

16.6

(7.5)

(0.7) 15.9

(1.8)

(9.3)

21.6 28.4%

(5.7) n.a.

1.0 0.1

(2.7) (0.3)

(5.8) n.a.

Average Inflation (YoY)

65.76 52.4%

Avg. Installed Capacity (Slots)

EUR

Local Currency

113.6 7,474

• • Operating Revenue in FY 2020 decreased by €246.5 mm or 77.7% compared to FY 2019, due to the bingo hall closings between March 16 and December 14, as well as to the significant devaluation of the Peso (50.1%) against the euro.

• • Operating Expenses (excluding D&A) decreased by 68.2% driven by a reduction in gaming taxes, which are variable, and across all fixed operating expenses such as personnel and rentals.

• • Adjusted EBITDA decreased by €83.3 mm to negative €5.5 mm, compared to €77.8 mm in FY 2019 as a result of the absence of revenues in Q2, Q3 and Q4 (except for the last 2 weeks).

• 1 Figures reflect primarily the disposal of gaming machines.

• 2 Figure reflects, following IAS 29, the net impact on revenues and costs from applying Argentinean inflation to the end of the period on the accrued items and ARS/EUR exchange rate as of December 31, 2020.

Spain1

Operating Revenue

Gaming & Other Taxes Personnel

Rentals

Cost of Goods Sold Other

Operating Expenses (excl. D&A)

Depreciation & Amortization

Variation in Provisions for Trade Transactions(1) Gains / (Losses) on Asset Disposals(2) Impairment Charges

Non-Recurring Items

Operating Profit

EBITDA EBITDA Margin

12.6 26.4%

Adjusted EBITDA Adjusted EBITDA Margin

13.7 28.7%

Avg. Installed Capacity (Slots)

Avg. Installed Capacity (Sports Betting Terminals)

• 10,097 8,160 (19.2%)

• 7,241 6,041 (16.6%)

Slots

• • Operating Revenue in FY 2020 declined by €73.4 mm (38.7%) to €116.4 mm compared to FY 2019, driven by closings of bars, restaurants, arcades and bingo halls between March 14 and mid-June, followed by additional temporary closings in certain regions, as well as the capacity, opening hour restrictions and curfews upon reopening, especially towards year end.

• • Operating Expenses (excluding D&A) decreased by 30.3% to €99.2 mm in FY 2020, as a result of our significant cost containment efforts on all items, notably personnel, where we achieved a 32.6% reduction in costs thanks to the temporary reductions of employment (ERTEs), and gaming taxes, which we reduced by nearly 29% despite the fact they are fixed in Spain.

• • Adjusted EBITDA declined 63.8% to €17.2 mm. Adjusted EBITDA margin decreased by 10.2 percentage points to 14.8% versus last year driven by the significant disruption on our revenue generation.

1 Figures reflect change in provisions on advances to site owners in connection with contracts to install our machines in their establishments.

2 Figures reflect primarily disposal of gaming machines.

Italy

Operating Revenue

Gaming & Other Taxes Personnel

Rentals

Cost of Goods Sold Other

Operating Expenses (excl. D&A)

Depreciation & Amortization

Variation in Provisions for Trade Transactions(1) Gains / (Losses) on Asset Disposals(2) Impairment Charges

Non-Recurring Items

Operating Profit

EBITDA EBITDA Margin

Adjusted EBITDA Adjusted EBITDA Margin

9.1 10.2%

(6.0) n.a.

9.2 10.4%

(3.4) n.a.

Avg. Installed Capacity (AWPs)

Avg. Installed Capacity (VLTs)

AWPs

VLTs

278 (81.7%)

73.2 (13.8%)

187 (12.2%)

• • Operating Revenue in FY 2020 decreased by €188.6 mm or 54.9% compared to FY 2019 as a result of the mandatory closings that took place in the country, initially between March 8 and mid-June, but also since late October through year end, as well as from the permanent closing of 2 of our bingo halls.

• • Operating Expenses (excluding D&A) decreased by 49.6% in FY 2020 to €158.6 mm compared to FY 2019, as a result of significant decreases across all cost items, especially gaming taxes.

• • Adjusted EBITDA was negative €3.9 mm in FY 2020, due to the nearly 6 months of complete closing of our operations between mid-March and mid-June and since late October through year end.

• • In addition, in mid-September we closed our bingo hall in Lecce in order to relocate it. We expect to reopen it in Q2

  2021. The full closing of our operations continued into 2021 and, as of the date of this report, our expectation as per the latest government decree is that we will be able to reopen by March 5.

1 Figures reflect change in provisions on advances to site owners in connection with contracts to install our machines in their establishments.

2 Figures reflect primarily disposal of gaming machines.

Other Operations

Panama

Uruguay Colombia Online

Operating Revenue

Panama Uruguay Colombia Online

Adjusted EBITDA Adjusted EBITDA Margin

EBITDA

Adjusted EBITDA

(-) Non-Recurring Items

(-) Online Growth Investment

EBITDA

EBITDA Margin

EUR/USD

EUR/UYU USD/UYU EUR/COP

Panama

Uruguay

• Colombia 3.8% 1.6%

Var. %

• 20.3 8.0 (60.5%)

• 18.8 11.8 (36.9%)

• 4.7 3.5 (24.6%)

• 22.8 58.7%

• 6.4 2.6 (59.6%)

• 1.6 0.8 (45.9%)

• 4.0 3.4 (14.9%)

5.5 (64.8%)

• 11.8% (14.9 p.p.)

• 5.5 (64.8%)

• (0.7) 77.4%

• (4.4) 21.3%

0.3

11.7% 0.7%

(11.0 p.p.)

• -0.4% 0.0%

• 8.5% 9.6%

  Full Year
  2020	Var. %
  7.7%	1.12	1.14	1.9%
  22.4%	39.45	47.96	21.6%
  13.6%	35.25	42.00	19.1%
  15.6%	3,673	4,215	14.8%
  0.4 p.p.	-0.4%	-1.4%	(1.1 p.p.)
  1.1 p.p.	7.9%	9.8%	1.9 p.p.
  (2.2 p.p.)	3.5%	2.5%	(1.0 p.p.)

  (20.5%)

  78.2	(71.0%)
  74.2	(29.6%)
  19.0	(54.1%)
  59.8	19.3%
  231.3	155.0	(33.0%)

  2019

  n.a.

  18.5	n.a.
  22.0	(14.3%)
  6.6	n.a.
  9.9	(0.4%)
  57.1	27.4	(52.1%)
  24.7%	(7.1 p.p.)

  (95.3%)

  57.1	(52.1%)
  (5.0)	36.1%
  (15.1)	4.9%
  37.0	9.9	(73.3%)
  16.0%	(9.6 p.p.)

  Other Operations includes results from Panama, Uruguay, Colombia and Online, but excludes Corporate Overhead.

  Operating revenue decreased by €76.3 mm (33.0%), to €155.0 mm as a result of:

  • • A combined decrease in Panama and Colombia of €65.8 mm due to the closing of operations between March and

    October, as well as additional regional closings in Panama in December.

  • • A decrease in Uruguay of €21.9 mm due to the closing of its operations between March and mid-May (in the case of the racetrack), and August in the case of the HRU associated gaming halls.

    Please note that the revenue recognition mechanics in our gaming hall operation in Uruguay have begun to reflect the impact of the closures in this business in Q4 2020.

  • • An increase of €11.5 mm on Online revenues coming mostly from the second half of the year, where the very strong performance (58.7% growth in Q4) offset the weak revenue trend in the second quarter due to the cancellation or postponement of most of the major sports events.

  Adjusted EBITDA decreased by €29.7 mm (52.1%), to €27.4 mm as a result of:

  • • A decrease in Panama of €19.4 mm, affected by the casino closings in Q2, Q3 and to a lesser extent Q4.

  • • A decrease in Colombia of €7.1 mm, also impacted by closings in Q2 and most of Q3.

  • • A decrease in Uruguay of €3.2 mm.

  Adjusted EBITDA margin in FY 2020 was 17.6%, 7.1 percentage points below that of FY 2019.

Consolidated Cash Flow Statement1

EBITDA

Capitalized Operating Leases

Inflation Adjustment

Corporate Income Taxes Paid

Chg. in Working Capital(1)

Cash Flow from Operations

Maintenance Capital Expenditures(2)

Growth Capital Expenditures(2), of which:

Capacity Deployment(3)

Acquisitions(4)

Initial Cash from Acquired Companies Cash Flow from Investing

Cash Interest Expense

Cash Interest Income

Chg. in Financial Debt

Chg. in Financial Investments

Chg. in Deferred Payments(5)

Dividends Paid, net(6)

Investment in Treasury Shares, net

Cash Effect from Exchange Rate Difference(7)

Cash Flow from Financing

Exchange Rate Impact on Cash Balances Cash Flow

Beginning of Period

Cash Flow

End of Period

(9.5) 110.3

• • Cash flow from operations in FY 2020 was negative €33.3 mm, a decrease of €210.5 mm versus €177.2 mm in FY

  2019. This decrease is primarily attributable to the decrease of €305.3 mm in reported EBITDA partially offset by a €31.7 mm reduction in corporate income tax paid and a €56.8 mm decrease in the working capital outflow (to an inflow of €57.8 mm). Inflation adjustments (IAS 29 accounting in Argentina) and Capitalized Operating Leases (IFRS 16) are excluded in the cash flow calculations, as they are non-cash items in the Income Statement.

• • Cash flow from investing in FY 2020 was €37.2 mm, a decline of 58.9% vs. FY 2019, and included €37.6 mm of capital expenditures partially offset by €0.4 mm of cash from acquired companies. Within capital expenditures, €31.5

  mm were related to maintenance and €6.1 mm to growth initiatives.

1 The difference between this figure and management reporting of net working capital corresponds mostly to non-cash FX movements in certain balance sheet items.

2 Figures reflect accrued amounts, including contingency payments (if any), and prior to any deferred payment arrangements (if applicable).

3 Includes opening of greenfield gaming halls, increase of capacity on existing ones, deployment and expansion of sports betting points of sale, among other projects.

4 Includes acquisition of gaming halls, slot operators and acquisition of product through previously operated through revenue share or operational agreements.

• 5 Includes changes in deferred payments related to capital expenditures.

• 6 Figure reflects dividends paid to minority partners net of dividends received from Group investments in unconsolidated entities.

• 7 Includes impact of FX differences on non-operational cash inflows and outflows.

• • Cash flow from financing was €89.1 mm in FY 2020 and included:

  • • €81.8 mm of cash interest expense, including €53.8 mm related to the coupon payments on our Senior

    Notes, €11.2 mm related to our refinancing process, €3.4 mm related to our SSRCF, €1.8 mm to the coupon payment on the newly issued €250 mm super senior notes and €11.6 mm related to OpCo debt (including capital leases);

  • • €1.2 mm of cash interest income;

  • • €182.8 mm increase in financial debt made up of:

    • (i) €221.1 mm net proceeds raised from the issuance of the €250.0 mm new super senior notes;

    • (ii) €45.0 mm net amortization of our SSRCF (€95.0 mm, fully repaid and canceled);

    • (iii) €1.5 mm decrease in capital leases;

    • (iv) €8.2 mm increase in OpCo financial debt (excluding capital leases) mainly due to new loans being raised in Mexico (€19.4 mm), Italy (€2.6 mm) and Panama (€0.4 mm), partially offset by the scheduled amortization of loans in Mexico (€5.6 mm), Uruguay (€4.1 mm), Panama (€2.3 mm), Spain (€1.7 mm) and Colombia (€0.5 mm).

  • • Decrease in deferred payments of €6.2 mm, consisting of deferred payments with capex suppliers mainly in Mexico, Argentina, Spain and Panama that offset the increase in deferred payments in Uruguay, Italy and our Platform;

  • • Dividends paid to minority partners of €3.1 mm;

  • • €1.8 mm negative impact from exchange rate differences;

• • The fluctuation in foreign exchange rates has resulted in a negative impact of €11.4 mm on conversion of cash balances;

• • During FY 2020, there has been an increase in cash and equivalents of €7.2 mm to €110.3 mm.

Capital Expenditures and Acquisitions1

Maintenance Capex in FY 2020 reached €31.5 mm, principally driven by:

• • Investment in Spain of €12.0 mm, a decrease of €5.4 mm versus last year;

• • Investment in Mexico of €5.1 mm, a decrease of €12.1 mm versus last year;

• • Investment in Uruguay of €3.6 mm. a decrease of €1.5 mm versus last year;

• • Investment in Italy of €3.5 mm, a decrease of €2.1 mm versus last year.

Growth Capex in FY 2020 was €6.1 mm, mostly deployed in Online, Mexico and Panama, and related to the works in halls.

• 1 Figures as per consolidated cash flow statements.

• 2 Includes primarily slot product/gaming hall renovation, exclusivity payments to site owners and gaming license renewals.

• 3 Includes primarily slot product/gaming hall expansion and acquisition activity.

• 4 Includes opening of greenfield gaming halls, increase of capacity on existing ones, deployment and expansion of sports betting, among other projects.

5 Includes acquisition of gaming halls, slot operators and acquisition of product previously operated through revenue share or operational agreements.

Consolidated Balance Sheet1

Figures in EUR mm, except where noted otherwise

As at

2

• 1 Includes €5.1 and €1.6 mm, respectively, in cash in transit (realized gross win in route business pending to be collected).

• 2 Includes A/R from customers, other parties and advances to employees net of insolvency provisions.

• 3 Includes all taxes receivable from tax authorities, including the 0.5% canon (AAMS) in Italy.

• 4 Includes accounts payable to suppliers, other parties and accrued wages.

• 5 Figures include provision for trade transactions and other provisions related to treasury share activity.

• 6 Figures include gaming taxes, corporate income taxes and other taxes payable to tax authorities.

• 7 Figures include deferred payments (and other partner investments) related to capital expenditures and other deferred payments.

• 8 Figures include all other provisions related to business contingencies (personnel, tax, etc.).

Net Working Capital1

As at

• • Total assets decreased by €308.6 mm in FY 2020. This decrease is principally attributable to a decrease in fixed assets, intangible assets, right of use assets (IFRS-16), taxes receivable and goodwill.

• • Current Assets decreased by €55.7 mm, as a result of a €49.2 mm decrease in taxes receivable partially offset by a €7.2 mm increase in cash & equivalents.

• • Financial debt, including both the short and long term portion increased by €116.2 mm as a result of the issuance of €250.0 mm new super senior notes, partially offset by the full repayment of €95.0 mm on the SSRCF.

• • Minority interests decreased by €35.9 mm to €45.2 mm and shareholders' equity decreased by €288.3 mm to negative €326.3 mm due to the €236.6 mm loss in the year together with exchange rate impacts.

• • Increased levels of commercial payables are reflected across several items of the balance sheet:

  • o First in current tax receivables and payables (receivables are significantly reduced as a consequence of the lower activity while payables remain stable despite such reduction).

  • o Second, as we are reporting an increase of accounts payable when, due to the reduced activity, such amount should have decreased.

  • o Third, as deferred payments are only increasing modestly when minimal capital expenditures are being done by the company, reflecting the re-scheduling of expected payment installments in 2020 from prior years' executed investments. On the other hand, significant devaluation of local currencies against the Euro have partially offset the impact of this increase of payables in the balance sheet.

Net Working Capital

• • Net working capital decreased by €49.7 mm to negative €134.3 mm, primarily due to a €24.7 mm increase in taxes payable, net6, a €15.1 mm decrease in accounts receivable, a € 3.6 mm decrease in inventory and a €3.3 mm increase in accounts payable.

1 The difference between this figure and the consolidated Cash Flow Statement corresponds mostly to non-cash FX movements in certain balance sheet items.

• 2 Figures reflect gaming and other taxes (i.e. exclude corporate income taxes).

• 3 Figures exclude security deposits.

• 4 Figures reflect provisions for trade transactions.

• 5 Figures reflect other deferred payment obligations (i.e. exclude deferred payments and other partner investments related to capital expenditures).

6 Taxes payable less taxes receivable.

Capitalization1

Figures in EUR mm, except where noted otherwise

S-T Financial Debt(1)

L-T Financial Debt(1)

Total Financial Debt

Minority Interests

Shareholders' Equity

Total Capitalization

18.0 49.1%

966.0 1,020.6

98.2 11.3%

45.2 (326.3) 739.5

12.8% (44.3%)

n.a.

(22.0%)

OpCo Debt (excl. Capital Leases)

OpCo Capital Leases

Sub-Total

Super Senior Revolving Credit Facility

Senior Notes

Total Financial Debt

Capitalization of Operating Leases(2)

Total Adjusted Debt

2.7%

(2.7) (39.0%)

(0.7) (0.7%)

208.3 1,228.9

n.a. 21.0% 12.8% (17.1%)

6.3%

Mexico

Argentina Spain Italy

Other Operations Sub-Total

Corporate T otal

Europe (incl. Corporate)

Latam

T otal

LTM Adjusted EBITDA Proforma Interest Expense(3)

Leverage:

Senior Financial Debt(4) / LTM Adjusted EBITDA Total Adj. Net Debt / LTM Adj. EBITDA

Including Inflation Accounting

Coverage:

LTM Adjusted EBITDA / Proforma Interest Expense

Including Inflation Accounting

(92.9%) 44.8%

3.9x 49.7x 60.4x

n.a. n.a. n.a.

0.2x 0.1x

(3.5x) (95.2%)

(3.6x) (98.6%)

1 Figures include accrued interest and impact of deferred financing fees, which, for covenant calculation purposes, would be excluded (i.e. financial debt and leverage would be lower).

• 2 Figures reflect short and long term capitalized operating leases following the application of IFRS 16.

• 3 Figures based on December 31, 2019 and December 31, 2020, as applicable, financial debt outstanding and interest rates; excludes fees on unused revolver availability.

4 Includes structurally senior OpCo debt (including capital leases).

Gaming Capacity1 by Venue, December 31, 2020*

Latin America

Argentina

Mexico(6)

Panama(6, 7) Colombia

Uruguay (CN)

Uruguay (HRU)(8)

Total

Europe

Italy

Spain(9)

Total

Total Group

- -

- 1

(*) Figures reflect venues in operation by year end, which in most countries were lower than those in operation as of the date of this report.

• 1 Figures reflect venues in operation as at December 31, 2019 and 2020, as applicable.

• 2 Includes all gaming venues with > 50 slot machines.

• 3 Includes all gaming venues with between 5 and 50 (inclusive) slot machines (Codere and/or 3rd party operated).

• 4 Includes all bars, restaurants, tobacco shops and other retail locations with < 5 slot machines and/or self-service sports betting terminals.

• 5 Includes sports books co-located within Codere gaming halls and other Codere operated standalone sports betting shops.

• 6 Figure for sports betting shops reflects sports books co-located within Codere operated gaming halls.

• 7 Figure for sports betting shops excludes 37 affiliated agencies (horserace betting only) in Q4 2019 and 19 in Q4 2020.

• 8 Figure for sports betting shops includes 4 sports book co-located within HRU operated gaming halls.

• 9 Sports betting shops excludes 48 franchised locations (included in Arcades).

• 10 Self-service sports betting terminals; arcades and bars would, however, typically have 3rd party operated AWPs.

Gaming Capacity1 by Product, December 31, 2020*

Latin America

Argentina Mexico

Panama(6) Colombia Uruguay (CN) Uruguay (HRU)

Total

Europe

Italy:(7)

AWP (8)

VLT (9)

Spain(10)

Total