Samsonite International S A : Consolidated Report for the Year ended December 31, 2020

Disclaimer

Non-IFRS Measures

The Company has presented certain non-IFRS(1) measures in the Directors' Report below because each of these measures provides additional information that management believes is useful in gaining a more complete understanding of the Group's operational performance and of the trends impacting its business to securities analysts, investors and other interested parties. These non-IFRS financial measures, as calculated herein, may not be comparable to similarly named measures used by other companies, and should not be considered comparable to IFRS measures. Non-IFRS measures have limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, an analysis of the Group's financial results as reported under IFRS.

Forward-looking Statements

This document contains forward-looking statements. Forward-looking statements reflect the Company's current views with respect to future events and performance. These statements may discuss, among other things, the Company's net sales, operating profit (loss), Adjusted Net Income (Loss), Adjusted EBITDA(2), Adjusted EBITDA margin, cash flow, liquidity and capital resources, potential impairments, growth, strategies, plans, achievements, distributions, organizational structure, future store openings or closings, market opportunities and general market and industry conditions. The Company generally identifies forward-looking statements by words such as "expect", "seek", "believe", "plan", "intend", "estimate", "project", "anticipate", "may", "will", "would" and "could" or similar words or statements. Forward-looking statements are based on beliefs and assumptions made by management using currently available information. These statements are only predictions and are not guarantees of future performance, actions or events. Forward-looking statements are subject to risks and uncertainties. These risks, uncertainties and other factors also include the potential effects of the COVID-19 pandemic on the Company's future financial and operational results, which could vary significantly depending on the duration and severity of the COVID-19 pandemic worldwide and the pace and extent of recovery following the COVID-19 pandemic.

If one or more of these risks or uncertainties materialize, or if management's underlying beliefs and assumptions prove to be incorrect, actual results may differ materially from those contemplated by a forward-looking statement. Among the factors that could cause actual results to differ materially are: the effect of worldwide economic conditions; the length and severity of the COVID-19 pandemic; lower levels of consumer spending resulting from COVID-19; a general economic downturn or generally reduced consumer spending, including as a result of COVID-19; the pace and extent of recovery following COVID-19; significant changes in consumer spending patterns or preferences; interruptions or delays in the supply of key components; the performance of the Group's products within the prevailing retail environment; financial difficulties encountered by customers and related bankruptcy and collection issues; and risks related to the success of the Group's restructuring programs. Given the inherent uncertainty about the future impacts of COVID-19, it is not possible for the Company to reliably predict the extent to which its business, results of operations, financial condition or liquidity will ultimately be impacted (see Directors' Report - Review of Financial Year 2020 - Impact of COVID-19 for further discussion).

Forward-looking statements speak only as of the date on which they are made. The Company's shareholders, potential investors and other interested parties should not place undue reliance on these forward-looking statements. The Company expressly disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable securities laws and regulations.

Rounding

Certain amounts presented in this document have been rounded up or down to the nearest million, unless otherwise indicated. There may therefore be discrepancies between the actual totals of the individual amounts in the tables and the totals shown, between the amounts in the tables and the amounts given in the corresponding analyses in the text of this document and between amounts in this document and other publicly available documents. All percentages and key figures were calculated using the underlying data in whole US Dollars.

Notes

1. International Financial Reporting Standards as issued by the International Accounting Standards Board.
2. Earnings before interest, taxes, depreciation and amortization.

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Directors' Report

Principal Activities

Samsonite International S.A. (the "Company"), together with its consolidated subsidiaries (the "Group"), is principally engaged in the design, manufacture, sourcing and distribution of luggage, business and computer bags, outdoor and casual bags, travel accessories and slim protective cases for personal electronic devices throughout the world, primarily under the Samsonite ®, Tumi ®, American Tourister ®, Speck ®, Gregory ®, High Sierra ®, Kamiliant ®, ebags ®, Lipault ® and Hartmann® brand names as well as other owned and licensed brand names.

Before 2012, the Group's business was primarily centered on the Samsonite brand, focused largely on travel luggage, and distributed principally through the wholesale channel. Over the last several years, the Group has strategically diversified its business in order to reduce its reliance on any single brand, market, channel of distribution or product category, and in line with the goal of not just building a bigger business, but a stronger one as well. Today, the Group has a more balanced business, built around a portfolio of diverse yet complementary brands and offering its customers a competitive mix of products sold through multiple distribution channels. The Company believes this diversification considerably strengthens its resilience and provides a platform for sustained growth.

The Group sells its products through a variety of wholesale distribution channels, through its company-operated retail stores and through e-commerce. The principal wholesale distribution customers of the Group are department and specialty retail stores, mass merchants, warehouse clubs and e-retailers. The Group sells its products in North America, Asia, Europe and Latin America.

1. Review of the Financial Year 2020

Impact of COVID-19

The COVID-19 pandemic has caused a global health emergency and significant disruptions to travel, tourism and economies worldwide. During the year ended December 31, 2020 the impacts of COVID-19 on the Company's business were significant due to government-mandated lockdowns that led to temporary closures of retail stores in which the Company's products are sold, quarantines and social-distancing required or recommended by governments, and significant reductions in travel and discretionary spending among consumers, which reduced demand for many of the Group's products (collectively, the "COVID-19 Impacts").

In response to the COVID-19 pandemic, governments around the world adopted various measures in an effort to contain the spread of the virus, including restrictions on travel, temporary closure of non-essential businesses and imposition of quarantine and other social distancing measures. These measures, along with the overall impacts of the COVID-19 pandemic, have impacted businesses worldwide, including the Company. The Group's net sales decreased by US$230.8 million, or 27.7% (-26.1% constant currency), year-on-year during the first quarter of 2020 as the COVID-19 Impacts, which initially affected the Group's business in China, began to affect the Group's business globally. During the second quarter of 2020, when most of the Group's markets were significantly affected by the COVID-19 Impacts, net sales decreased by US$722.6 million, or 78.2% (-77.9% constant currency), year-on-year. The Group's net sales decreased by US$594.8 million, or 64.6% (-64.7% constant currency), year- on-year during the third quarter of 2020, as governments loosened restrictions and certain of the Group's markets began reopening. During the fourth quarter of 2020, the Group's net sales decreased by US$553.9 million, or 57.6% (-58.1% constant currency), as more of the Group's markets reopened as a result of governments further loosening restrictions. Overall, the Group's net sales for the year ended December 31, 2020 decreased by US$2,102.1 million, or 57.8% (-57.5% constant currency), compared to the year ended December 31, 2019 due to the COVID-19 Impacts.

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While navigating through the challenges caused by COVID-19, the health and safety of the Group's employees and their families, as well as its customers and business partners, has been and will continue to be the Group's top priority. While the extent and duration of the COVID-19 pandemic remain uncertain, it has had, and it will continue to have, adverse impacts on the Group's business, financial condition and results of operations.

During 2020, the Group's management has taken steps to enhance the Company's liquidity and further improve its resilience. In order to strengthen the Company's financial flexibility in order to navigate the challenges from COVID-19, the Company and certain of its direct and indirect wholly-owned subsidiaries entered into amendments to the Group's credit agreement that increased the maximum borrowings under the Group's revolving credit facility by US$200.0 million to US$850.0 million and provided for the 2020 Incremental Term Loan B Facility (as defined in the Directors' Report - Review of Financial Year 2020 - Indebtedness section below) in the aggregate principal amount of US$600.0 million. The Group borrowed US$810.3 million (USD equivalent at the applicable exchange rate on the borrowing date) under its Amended Revolving Credit Facility (as defined in the Directors' Report - Review of Financial Year 2020

• Indebtedness section below) on March 20, 2020 and US$600.0 million under the 2020 Incremental Term Loan B Facility on May 7, 2020. Such amendments also suspended the requirement for the Group to test certain financial covenants under its credit agreement from the beginning of the second quarter of 2020 through the end of the second quarter of 2021 and, for each of the three quarters beginning with the third quarter of 2021 and ending with the first quarter of 2022, the Company may elect to use Consolidated Adjusted EBITDA (as defined in the Third Amended Credit Agreement) from the first two quarters of 2019 and fourth quarter of 2019 (the "Historical EBITDA") (instead of actual Consolidated Adjusted EBITDA from the fourth quarter of 2020 and the first two quarters of 2021) to calculate compliance with the Financial Covenants (as defined in the Third Amended Credit Agreement). During the Suspension Period (as defined in the Directors' Report - Review of Financial Year 2020 - Indebtedness section below), the Company is required to comply with a minimum liquidity covenant of US$500.0 million and the Group is subject to additional restrictions on its ability to incur indebtedness and make restricted payments (including payments of distributions or dividends to the Company's shareholders) and investments. See Directors' Report - Review of Financial Year 2020 - Indebtedness for further description of the Group's credit agreement.

As of December 31, 2020, the carrying amount of the Group's loans and borrowings was US$3,190.6 million, net of US$39.9 million in deferred financing costs. Cash and cash equivalents held by the Group amounted to US$1,495.0 million as of December 31, 2020. Along with US$23.4 million available to be borrowed on the Group's Amended Revolving Credit Facility (as defined below), the Group had total liquidity of US$1,518.3 million as of December 31, 2020, and was therefore in compliance with the US$500.0 million minimum liquidity required under the Company's credit agreement during the Suspension Period (as defined below).

In response to the decline in net sales during the year ended December 31, 2020 due to COVID-19, in addition to the strengthening of the Company's liquidity, the Group has taken meaningful actions to manage the impacts of COVID-19 on its consolidated operating results. The Group has aggressively reduced its operating expenses to mitigate the impact of lower sales on profit and cash flow and also to right-size the business for the future. The Group's management continues to evaluate additional opportunities to reduce expenses.

For the year ended December 31, 2020, the Group reduced its marketing expenditures by US$116.3 million, or 61.3%, to US$73.3 million, compared to 2019. The Group implemented comprehensive measures to conserve cash, including the temporary suspension of the annual cash distribution to shareholders (US$125.0 million annual cash distribution was paid to shareholders in 2019) and a virtual freeze on capital expenditures. The Group spent US$26.1 million on capital expenditures (including software purchases) during the year ended December 31, 2020, compared to capital expenditures (including software purchases) of US$74.5 million in 2019. Following the onset of the COVID-19 pandemic, the Group spent US$6.9 million on capital expenditures (including software purchases) from April 2020 through December 2020, compared to US$57.2 million spent during the same time period in 2019.

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The Group realized fixed cost savings from a combination of permanent and temporary actions during the year ended December 31, 2020. Permanent actions consisted primarily of headcount reductions and savings from closing stores. Temporary actions consisted primarily of furloughs, temporary headcount reductions, eliminating bonuses, salary reductions, temporary rent reductions and other expense reductions, such as travel and entertainment and professional services.

The following table presents the total fixed cost savings realized through December 31, 2020 and the estimated annualized run-rate of such fixed cost savings that the Company expects will reduce its fixed operating expenses in 2021. The fixed cost savings identified below are reflected as reductions in the Group's cost of sales, distribution expenses and general and administrative expenses that are reported in the consolidated statements of income (loss).

Note

1. The identified total estimated annualized run-rate fixed cost savings includes cost savings actions identified in 2020 to be executed in 2021.

In addition to these actions, the Group continues to work to maximize the Company's participation in applicable government or other initiatives available to businesses or employees impacted by the COVID-19 pandemic. The Group continues to engage with landlords to further negotiate rent deferrals or other rent concessions. The Group also continues to evaluate additional areas of cost savings in response to the impacts on the business from the COVID-19 pandemic. See Directors' Report - Review of Financial Year 2020 - Restructuring Charges for further discussion.

Given the inherent uncertainty about the future impacts of COVID-19, it is not possible for the Company to reliably predict the extent to which the Group's business, results of operations, financial condition or liquidity will ultimately be impacted, however the Group's financial condition and results of operations have been, and will continue to be, adversely affected.

Given the Group's experience with prior disruptions to travel, the Company believes the Group will be able to effectively manage through the current environment, although it expects the recovery to take longer than prior disruptions. The Company believes that its existing cash and estimated cash flows will be adequate to meet the foreseeable future operating and capital requirements of the Group at least through March 31, 2022; however, there can be no assurances that such liquidity will be sufficient or that the Group may not need to access additional financing.

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Net Sales

Net sales decreased by US$2,102.1 million, or 57.8% (-57.5% constant currency), during the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the COVID-19 Impacts. The net sales trend gradually improved after April 2020, when the impacts of COVID-19 on the Company's business were most pronounced. Net sales for the three months ended December 31, 2020 decreased by 57.6% (-58.1% constant currency), compared to the three months ended December 31, 2019. In comparison, net sales for the three months ended September 30, 2020 decreased by 64.6% (-64.7% constant currency), compared to the three months ended September 30, 2019. Net sales for the three months ended June 30, 2020 decreased by 78.2% (-77.9% constant currency), compared to the three months ended June 30, 2019. The following table sets forth a breakdown of the monthly and quarterly net sales trend from April 2020 through December 2020.

Note

1. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

Net sales for the month ended January 31, 2021 decreased by US$146.3 million, or 53.6% (-54.7% constant currency), compared to the month ended January 31, 2020. Net sales for the month ended February 28, 2021 decreased by US$102.8 million, or 50.4% (-51.6% constant currency), compared to the month ended February 29, 2020. Net sales for the two months ended February 28, 2021 decreased by US$249.1 million, or 52.2% (-53.3% constant currency), compared to the two months ended February 29, 2020.

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The following table sets forth a breakdown of net sales by region for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total net sales.

Notes

1. The geographic location of the Group's net sales generally reflects the country/territory from which its products were sold and does not necessarily indicate the country/territory in which its end consumers were actually located.
2. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

Brands

The following table sets forth a breakdown of net sales by brand for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total net sales.

Notes

1. "Other" includes certain other brands owned by the Group, such as Kamiliant, ebags, Xtrem, Lipault, Hartmann, Saxoline and Secret , as well as third-party brands sold through the Group's Rolling Luggage and Chic Accent retail stores and the ebags e-commerce website.
2. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

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All of the Group's brands recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales of the Samsonite brand during the year ended December 31, 2020 decreased by US$982.0 million, or 59.3% (-59.1% constant currency), compared to the previous year. Net sales of the Tumi brand during the year ended December 31, 2020 decreased by US$445.4 million, or 58.1% (-58.1% constant currency), year- on-year. Net sales of the American Tourister brand decreased by US$410.4 million, or 62.7% (-62.2% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019.

Net sales of the Speck brand decreased by US$27.5 million, or 22.2% (-22.2% constant currency), for the year ended December 31, 2020 compared to the previous year. Net sales of the Gregory brand decreased by US$18.6 million, or 26.6% (-27.5% constant currency), compared to the previous year. Net sales of the High Sierra brand decreased by US$37.3 million, or 59.0% (-59.0% constant currency), year-on-year.

Product Categories

The Group sells products in two principal product categories: travel and non-travel. The following table sets forth a breakdown of net sales by product category for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total net sales.

Notes

1. The non-travel category includes business, casual, accessories and other products.
2. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

All of the Group's product categories recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the travel product category during the year ended December 31, 2020 decreased by US$1,399.3 million, or 64.7% (-64.4% constant currency), compared to the year ended December 31, 2019 as a result of the significant reduction in travel caused by COVID-19. Total non-travel category net sales, which includes business, casual, accessories and other products, decreased by US$702.8 million, or 47.6% (-47.3% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019. Net sales of business products decreased by US$325.5 million, or 47.2% (-47.2% constant currency), for the year ended December 31, 2020 compared to the previous year. Net sales of casual products during the year ended December 31, 2020 decreased by US$181.0 million, or 46.5% (-45.5% constant currency), compared to the previous year. Net sales of accessories during the year ended December 31, 2020 decreased by US$167.8 million, or 48.5% (-48.3% constant currency), year-on-year.

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Distribution Channels

The Group sells products through two primary distribution channels: wholesale and direct- to-consumer ("DTC"). The following table sets forth a breakdown of net sales by distribution channel for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total net sales.

Notes

1. DTC, or direct-to-consumer, includes bricks-and-mortar retail and e-commerce sites owned and operated by the Group.
2. "Other" primarily consists of licensing revenue.
3. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

All of the Group's distribution channels recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the wholesale channel decreased by US$1,332.5 million, or 58.2% (-57.9% constant currency), during the year ended December 31, 2020 compared to the year ended December 31, 2019. Net sales to e-retailers, which are included in the Group's wholesale channel, decreased by US$95.2 million, or 43.2% (-43.6% constant currency), during the year ended December 31, 2020 compared to the previous year as net sales through the Group's e-retailer customers were impacted less by lockdowns.

Net sales in the DTC channel, which includes company-operated retail stores and DTC e-commerce, decreased by US$768.5 million, or 57.1% (-56.8% constant currency), to US$576.9 million (representing 37.5% of net sales) for the year ended December 31, 2020 from US$1,345.4 million (representing 37.0% of net sales) for the year ended December 31, 2019.

Net sales in the DTC retail channel decreased by US$606.4 million, or 62.6% (-62.2% constant currency), during the year ended December 31, 2020 compared to the previous year due to temporary store closures and reduced consumer demand resulting from the COVID-19 pandemic. During the year ended December 31, 2020, the Group permanently closed 260 company-operated stores. This was partially offset by the addition of 62 stores, primarily in Asia (including the agreed takeover of 20 stores in India from a third-party distributor as previously announced), plus a number of previously committed store openings. This resulted in a net reduction of 198 company-operated stores closed during the year ended December 31, 2020, compared to 43 net new company-operated stores opened during the year ended December 31, 2019. The total number of company-operated retail stores was 1,096 as of December 31, 2020, compared to 1,294 company-operated retail stores as of December 31, 2019. Besides the 260 company-operated stores that have been permanently closed, the Group has also negotiated early exits on an additional 34 company-operated stores that will occur during 2021. Furthermore, the Group has successfully renegotiated 200 store leases, collectively saving approximately US$10.5 million of annualized cash rent. On a same store, constant currency basis, retail net sales decreased by 63.7% for the year ended December 31, 2020 compared to

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the year ended December 31, 2019. This decrease was due to constant currency same store net sales decreases of 70.8%, 55.9%, 63.5% and 50.6% in North America, Asia, Europe and Latin America, respectively, resulting from the temporary store closures and reduced consumer demand caused by the COVID-19 Impacts. The Group's same store analysis includes existing company-operated retail stores that have been open for at least 12 months before the end of the relevant financial period.

Total DTC e-commerce net sales decreased by US$162.1 million, or 43.0% (-43.0% constant currency), to US$214.6 million (representing 14.0% of net sales) for the year ended December 31, 2020 from US$376.6 million (representing 10.4% of net sales) for the year ended December 31, 2019 as net sales through the Group's DTC e-commerce channels were impacted less by lockdowns than net sales through its bricks-and-mortar retail stores.

During the year ended December 31, 2020, US$339.7 million of the Group's net sales were through e-commerce channels (comprising US$214.6 million of net sales from the Group's DTC e-commerce website, which are included within the DTC channel, and US$125.1 million of net sales to e-retailers, which are included within the wholesale channel). This represented

1. year-on-yeardecrease of US$257.2 million, or 43.1% (-43.2% constant currency), compared to the year ended December 31, 2019, when e-commerce comprised US$596.9 million of the Group's net sales. During the year ended December 31, 2020, the Group's net sales through e-commerce channels represented 22.1% of total net sales, compared to 16.4% of total net sales for the year ended December 31, 2019 as the shift in consumer's shopping behavior towards e-commerce channels accelerated as a result of the COVID-19 pandemic.

Regions North America

The Group's net sales in North America decreased by US$760.9 million, or 55.8% (-55.8% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the COVID-19 Impacts. Net sales in North America reflected a gradual improvement in sales trends after April 2020 when the effects of the COVID-19 Impacts were most pronounced. Net sales decreased by 56.6% (-56.6% constant currency), for the three months ended December 31, 2020 compared to the three months ended December 31, 2019. In comparison, the Group's net sales in North America decreased by 64.4% (-64.3% constant currency), for the three months ended September 30, 2020 compared to the three months ended September 30, 2019. Net sales for the three months ended June 30, 2020 decreased by 74.0% (-74.0% constant currency), compared to the three months ended June 30, 2019.

Brands

All of the Group's brands in North America recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. For the year ended December 31, 2020, net sales of the Samsonite brand in North America decreased by US$318.8 million, or 59.7% (-59.7% constant currency), compared to the previous year. Net sales of the Tumi brand during the year ended December 31, 2020 decreased by US$251.0 million, or 61.0% (-61.0% constant currency). Net sales of the American Tourister brand during the year ended December 31, 2020 decreased by US$46.9 million, or 45.1% (-45.1% constant currency), compared to the year ended December 31, 2019. Net sales of the Speck brand for the year ended December 31, 2020 decreased by US$27.5 million, or 22.2% (-22.2% constant currency), compared to the previous year. Net sales of the High Sierra brand for the year ended December 31, 2020 decreased by US$26.7 million, or 55.0% (-55.0% constant currency), year-on-year. Net sales of other brands for the year ended December 31, 2020 decreased by US$82.3 million, or 67.9% (-67.9% constant currency), compared to the previous year.

Product Categories

All of the Group's product categories in North America recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the travel product category in North America decreased by US$477.8 million, or 60.9% (-60.9% constant currency), to US$307.2 million for the year ended December 31, 2020 from US$785.0 million for the year ended December 31, 2019. Total non-travel category net sales

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in North America decreased by US$283.1 million, or 48.9% (-48.9% constant currency), to US$295.3 million for the year ended December 31, 2020 from US$578.3 million for the year ended December 31, 2019. Net sales of business products during the year ended December 31, 2020 decreased by US$124.0 million, or 49.8% (-49.8% constant currency), compared to the previous year. Net sales of casual products decreased by US$69.9 million, or 56.1% (-56.1% constant currency), year-on-year. Net sales of accessories products decreased by US$84.3 million, or 42.5% (-42.5% constant currency), year-on-year.

Distribution Channels

All of the Group's distribution channels in North America recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the wholesale channel in North America decreased by US$373.4 million, or 50.4% (-50.4% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019. Net sales to e-retailers, which are included in the Group's wholesale channel, decreased by US$22.8 million, or 28.0% (-28.0% constant currency), during the year ended December 31, 2020 compared to the previous year as net sales through the Group's e-retailer customers were impacted less by lockdowns.

Net sales in the DTC channel, which includes company-operated retail stores and DTC e-commerce, decreased by US$387.5 million, or 62.3% (-62.3% constant currency), year-on- year to US$234.5 million for the year ended December 31, 2020 from US$621.9 million for the year ended December 31, 2019.

Net sales in the DTC retail channel decreased by US$264.9 million, or 68.0% (-68.0% constant currency), during the year ended December 31, 2020 compared to the previous year primarily due to temporary store closures and reduced consumer demand resulting from the COVID-19 pandemic. During the year ended December 31, 2020, the Group permanently closed 73 company-operated stores in North America. This was partially offset by the addition of 7 stores. This resulted in a net reduction of 66 company-operated stores closed during the year ended December 31, 2020, compared to 13 net new company-operated stores opened during the year ended December 31, 2019. The total number of company-operated retail stores in North America was 282 as of December 31, 2020, compared to 348 company-operated retail stores as of December 31, 2019. On a same store, constant currency basis, retail net sales in North America decreased by 70.8% for the year ended December 31, 2020 compared to the year ended December 31, 2019, resulting from the temporary store closures and reduced consumer demand caused by the COVID-19 Impacts. The Group's same store analysis includes existing company-operated retail stores that have been open for at least 12 months before the end of the relevant financial period.

Total DTC e-commerce net sales decreased by US$122.6 million, or 52.8% (-52.8% constant currency), to US$109.7 million for the year ended December 31, 2020 from US$232.3 million for the year ended December 31, 2019 as net sales through the Group's DTC e-commerce channels were impacted less by lockdowns than net sales through its bricks-and-mortar retail stores. This net sales decrease in DTC e-commerce was primarily due to the impacts of COVID-19 on travel and consumer demand, as well as due to the Group's strategic decision in 2019 to reduce the sales of third-party brands on its ebags e-commerce website to improve profitability.

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Countries

The following table sets forth a breakdown of net sales in North America by geographic location for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total regional net sales.

Notes

1. The geographic location of the Group's net sales generally reflects the country from which its products were sold and does not necessarily indicate the country in which its end consumers were actually located.
2. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

For the year ended December 31, 2020, net sales in the United States decreased by US$720.7 million, or 55.5%, year-on-year and net sales in Canada decreased by US$40.2 million, or 63.1% (-63.0% constant currency), year-on-year due to the COVID-19 Impacts.

Asia

The Group's net sales in Asia decreased by US$754.8 million, or 57.5% (-57.5% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the COVID-19 Impacts. Net sales in Asia reflected continued improvement in sales trends after April 2020 when the effects of the COVID-19 Impacts were most pronounced. Net sales decreased by 54.7% (-56.1% constant currency), for the three months ended December 31, 2020 compared to the three months ended December 31, 2019. In comparison, the Group's net sales in Asia decreased by 63.1% (-63.4% constant currency) for the three months ended September 30, 2020 compared to the three months ended September 30, 2019. Net sales for the three months ended June 30, 2020 decreased by 76.2% (-75.6% constant currency), compared to the three months ended June 30, 2019.

Brands

All of the Group's brands in Asia recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. For the year ended December 31, 2020, net sales of the Samsonite brand in Asia decreased by US$308.7 million, or 56.2% (-56.4% constant currency), compared to the previous year. Net sales of the Tumi brand during the year ended December 31, 2020 decreased by US$122.4 million, or 49.7% (-50.1% constant currency), year-on-year. Net sales of the American Tourister brand during the year ended December 31, 2020 decreased by US$255.6 million, or 65.8% (-65.4% constant currency), compared to the year ended December 31, 2019. Net sales of the Kamiliant brand decreased by US$30.0 million, or 64.5% (-63.7% constant currency), year-on-year. Net sales of the Gregory brand decreased by US$10.3 million, or 24.5% (-25.8% constant currency), compared to the previous year.

Product Categories

All of the Group's product categories in Asia recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the travel product category in Asia decreased by US$519.3 million, or 67.0% (-66.9% constant currency), to US$255.3 million for the year ended December 31, 2020 from US$774.7 million for the previous year. Total non-travel category net sales in Asia decreased by US$235.5 million, or 43.7% (-43.9% constant currency), to US$303.3 million for the year ended December 31, 2020

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from US$538.8 million for the year ended December 31, 2019. Net sales of business products decreased by US$127.1 million, or 42.4% (-42.8% constant currency), compared to the previous year. Net sales of casual products decreased by US$72.7 million, or 41.1% (-41.2% constant currency), year-on-year. Net sales of accessories products decreased by US$30.1 million, or 59.7% (-59.8% constant currency) year-on-year.

Distribution Channels

All of the Group's distribution channels in Asia recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the wholesale channel in Asia decreased by US$609.1 million, or 61.2% (-61.1% constant currency), for the year ended December 31, 2020 compared to the previous year. Net sales to e-retailers, which are included in the Group's wholesale channel, decreased by US$46.0 million, or 57.9% (-58.1% constant currency), during the year ended December 31, 2020 compared to the previous year as net sales through the Group's e-retailer customers were impacted less by lockdowns.

Net sales in the DTC channel, which includes company-operated retail stores and DTC e-commerce, decreased by US$145.7 million, or 45.7% (-46.1% constant currency), to US$173.0 million for the year ended December 31, 2020 from US$318.8 million for the year ended December 31, 2019.

Net sales in the DTC retail channel decreased by US$118.1 million, or 52.7% (-53.0% constant currency), during the year ended December 31, 2020 compared to the previous year primarily due to temporary store closures and reduced consumer demand resulting from the COVID-19 pandemic. During the year ended December 31, 2020, the Group permanently closed 76 company-operated stores in Asia. This was partially offset by the addition of 43 stores, (including the agreed takeover of 20 stores in India from a third-party distributor as previously announced), plus a number of previously committed store openings. This resulted in a net reduction of 33 company-operated stores closed during the year ended December 31, 2020, compared to 11 net new company-operated stores opened during the year ended December 31, 2019. The total number of company-operated retail stores in Asia was 375 as of December 31, 2020, compared to 408 company-operated retail stores as of December 31, 2019. On a same store, constant currency basis, retail net sales in Asia decreased by 55.9% for the year ended December 31, 2020 compared to the year ended December 31, 2019, resulting from the temporary store closures and reduced consumer demand caused by the COVID-19 Impacts. The Group's same store analysis includes existing company-operated retail stores that have been open for at least 12 months before the end of the relevant financial period.

Total DTC e-commerce net sales decreased by US$27.6 million, or 29.2% (-29.7% constant currency), to US$67.1 million for the year ended December 31, 2020 from US$94.7 million for the year ended December 31, 2019 as net sales through the Group's DTC e-commerce channels were impacted less by lockdowns than net sales through its bricks-and-mortar retail stores. This net sales decrease in DTC e-commerce was primarily due to the impacts of COVID-19 on travel and consumer demand, partially offset by the continued rollout of Company- owned e-commerce websites across the Asia region.

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Countries/Territories

The following table sets forth a breakdown of net sales in Asia by geographic location for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total regional net sales.

Notes

1. The geographic location of the Group's net sales generally reflects the country/territory from which its products were sold and does not necessarily indicate the country/territory in which its end consumers were actually located.
2. Net sales reported for Hong Kong include net sales made domestically, net sales made in Macau as well as net sales to distributors in certain other Asian markets where the Group does not have a direct presence.
3. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

All of the Group's main markets in Asia experienced year-on-year net sales declines during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in China decreased by US$139.3 million, or 45.5% (-46.0% constant currency), for the year ended December 31, 2020 compared to the previous year. Japan's net sales decreased by US$101.6 million, or 46.8% (-47.9% constant currency), year-on-year. Net sales in South Korea decreased by US$106.8 million, or 57.9% (-57.1% constant currency), year-on-year. Net sales in India decreased by US$113.6 million, or 65.2% (-64.0% constant currency), for the year ended December 31, 2020 year-on-year. Total net sales reported for Hong Kong (which comprises net sales made in the domestic Hong Kong market, Macau and to distributors in certain other Asian markets) decreased by US$108.5 million, or 71.3% (-71.5% constant currency), year-on-year.

Europe

The Group's net sales in Europe decreased by US$489.8 million, or 61.8% (-61.7% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the COVID-19 Impacts. Net sales decreased by 66.3% (-67.1% constant currency), for the three months ended December 31, 2020 compared to the three months ended December 31, 2019 as governments across the region reinstated restrictions due to the resurgence of COVID-19 cases in late 2020. The Group's net sales in Europe decreased by 64.8% (-65.7% constant currency), for the three months ended September 30, 2020 compared to the three months ended September 30, 2019. Net sales in Europe for the three months ended June 30, 2020 decreased by 86.0% (-85.7% constant currency), compared to the three months ended June 30, 2019.

Brands

All of the Group's brands in Europe recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. For the year ended December 31, 2020, net sales of the Samsonite brand in Europe decreased by US$306.8 million, or 61.3% (-61.2% constant currency), compared to the previous year. Net sales of the Tumi brand during the year ended December 31, 2020 decreased by US$69.4 million, or 66.4% (-66.2% constant

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currency), year-on-year. Net sales of the American Tourister brand during the year ended December 31, 2020 decreased by US$91.2 million, or 65.9% (-65.5% constant currency), compared to the year ended December 31, 2019.

Product Categories

All of the Group's product categories in Europe recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the travel product category in Europe decreased by US$349.8 million, or 66.4% (-66.2% constant currency), to US$176.7 million for the year ended December 31, 2020 from US$526.5 million for the year ended December 31, 2019. Total non-travel category net sales in Europe decreased by US$139.9 million, or 52.7% (-52.8% constant currency), year-on-year to US$125.8 million for the year ended December 31, 2020 from US$265.7 million for the previous year. Net sales of business products decreased by US$64.2 million, or 51.9% (-51.9% constant currency), year- on-year. Net sales of casual products decreased by US$16.7 million, or 43.4% (-43.6% constant currency), compared to the previous year. Net sales of accessories products decreased by US$42.8 million, or 57.8% (-58.2% constant currency), year-on-year.

Distribution Channels

All of the Group's distribution channels in Europe recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the wholesale channel in Europe decreased by US$294.5 million, or 63.6% (-63.5% constant currency), during the year ended December 31, 2020 compared to the year ended December 31, 2019. Net sales to e-retailers, which are included in the Group's wholesale channel, decreased by US$26.3 million, or 44.4% (-45.6% constant currency), during the year ended December 31, 2020 compared to the previous year as net sales through the Group's e-retailer customers were impacted less by lockdowns.

Net sales in the DTC channel, which includes company-operated retail stores and DTC e-commerce, decreased by US$195.3 million, or 59.4% (-59.1% constant currency), to US$133.6 million for the year ended December 31, 2020 from US$328.9 million for the year ended December 31, 2019.

Net sales in the DTC retail channel decreased by US$183.1 million, or 64.8% (-64.5% constant currency), during the year ended December 31, 2020 compared to the previous year primarily due to temporary store closures and reduced consumer demand resulting from the COVID-19 pandemic. During the year ended December 31, 2020, the Group permanently closed 76 company-operated stores in Europe. This was partially offset by the addition of 6 stores. This resulted in a net reduction of 70 company-operated stores closed during the year ended December 31, 2020, compared to 12 net new company-operated stores opened during the year ended December 31, 2019. The total number of company-operated retail stores in Europe was 242 as of December 31, 2020, compared to 312 company-operated retail stores as of December 31, 2019. On a same store, constant currency basis, retail net sales in Europe decreased by 63.5% for the year ended December 31, 2020 compared to the year ended December 31, 2019, resulting from the temporary store closures and reduced consumer demand caused by the COVID-19 Impacts. The Group's same store analysis includes existing company-operated retail stores that have been open for at least 12 months before the end of the relevant financial period.

Total DTC e-commerce net sales decreased by US$12.2 million, or 26.2% (-26.6% constant currency), to US$34.3 million for the year ended December 31, 2020 from US$46.5 million for the year ended December 31, 2019 as net sales through the Group's DTC e-commerce channels were impacted less by lockdowns than net sales through its bricks-and-mortar retail stores. This net sales decrease in DTC e-commerce was primarily due to the impacts of COVID-19 on travel and consumer demand.

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Countries

The following table sets forth a breakdown of net sales in Europe by geographic location for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total regional net sales.

Notes

1. The geographic location of the Group's net sales generally reflects the country from which its products were sold and does not necessarily indicate the country in which its end consumers were actually located.
2. Net sales in Belgium were US$6.7 million and US$22.1 million for the years ended December 31, 2020 and December 31, 2019, respectively, a decrease of US$15.5 million, or 69.8% (-70.5% constant currency). Remaining sales consisted of direct shipments to distributors, customers and agents in other European countries, including e-commerce.
3. Net sales reported for the United Kingdom include net sales made in Ireland.
4. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

All of the Group's key markets in Europe recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in Germany decreased by US$71.6 million, or 59.9% (-60.6% constant currency), for the year ended December 31, 2020 compared to the previous year. Italy's net sales decreased by US$50.1 million, or 61.1% (-61.8% constant currency), compared to the year ended December 31, 2019. Net sales in France decreased by US$49.8 million, or 64.0% (-64.5% constant currency), compared to the previous year. Net sales in Russia decreased by US$36.1 million, or 59.6% (-55.3% constant currency), year-on-year. Net sales in the United Kingdom decreased by US$58.9 million, or 76.8% (-77.0% constant currency), year-on-year.

Latin America

The Group's net sales in Latin America decreased by US$95.6 million, or 57.3% (-51.8% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the COVID-19 Impacts. The net sales trend gradually improved after April 2020, when the impacts of COVID-19 on the Company's business were most pronounced. Net sales decreased by 46.9% (-43.2% constant currency), for the three months ended December 31, 2020 compared to the three months ended December 31, 2019. In comparison, the Group's net sales in Latin America decreased by 77.8% (-74.2% constant currency), for the three months ended September 30, 2020 compared to the three months ended September 30, 2019. Net sales for the three months ended June 30, 2020 decreased by 95.4% (-94.3% constant currency), compared to the three months ended June 30, 2019.

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Brands

All of the Group's brands in Latin America recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. For the year ended December 31, 2020, net sales of the Samsonite brand in Latin America decreased by US$47.7 million, or 66.8% (-61.4% constant currency), compared to the previous year. Net sales of the American Tourister brand during the year ended December 31, 2020 decreased by US$16.7 million, or 69.1% (-65.2% constant currency), compared to the year ended December 31, 2019. For the year ended December 31, 2020, net sales of the Tumi brand in Latin America decreased by US$2.6 million, or 54.5% (-50.6% constant currency), compared to the previous year. Net sales of the Xtrem brand decreased by US$12.9 million, or 39.6% (-31.8% constant currency), compared to the previous year. Net sales of the Saxoline brand decreased by 50.0% (-42.6% constant currency), year-on-year. Net sales of the Secret brand decreased by 40.7% (-37.8% constant currency), year-on-year.

Product Categories

All of the Group's product categories in Latin America recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the travel product category in Latin America decreased by US$52.3 million, or 68.8% (-64.4% constant currency), to US$23.8 million for the year ended December 31, 2020 from US$76.1 million for the previous year. Total non-travel category net sales in Latin America decreased by US$43.2 million, or 47.7% (-41.3% constant currency), to US$47.4 million for the year ended December 31, 2020 from US$90.6 million for the year ended December 31, 2019. Net sales of business products decreased by US$10.3 million, or 59.3% (-54.1% constant currency), compared to the previous year. Net sales of casual products decreased by US$21.7 million, or 44.1% (-35.8% constant currency), year-on-year. Net sales of accessories products decreased by US$10.5 million, or 45.1% (-41.6% constant currency), year-on-year.

Distribution Channels

All of the Group's distribution channels in Latin America recorded year-on-year net sales decreases during the year ended December 31, 2020 due to the COVID-19 Impacts. Net sales in the wholesale channel in Latin America decreased by US$55.6 million, or 61.1% (-56.0% constant currency), for the year ended December 31, 2020 compared to the year ended December 31, 2019.

Net sales in the DTC channel, which includes company-operated retail stores and DTC e-commerce, decreased by US$40.0 million, or 52.8% (-46.9% constant currency), to US$35.7 million for the year ended December 31, 2020 from US$75.8 million for the year ended December 31, 2019.

Net sales in the DTC retail channel decreased by US$40.3 million, or 55.5% (-50.3% constant currency), during the year ended December 31, 2020 compared to the previous year primarily due to temporary store closures and reduced consumer demand resulting from the COVID-19 pandemic. During the year ended December 31, 2020, the Group permanently closed 35 company-operated stores in Latin America. This was partially offset by the addition of 6 stores due to a number of previously committed store openings. This resulted in a net reduction of 29 company-operated stores closed during the year ended December 31, 2020, compared to 7 net new company-operated stores opened during the year ended December 31, 2019. The total number of company-operated retail stores in Latin America was 197 as of December 31, 2020, compared to 226 company-operated retail stores as of December 31, 2019. On a same store, constant currency basis, retail net sales decreased by 50.6% for the year ended December 31, 2020 compared to the year ended December 31, 2019, resulting from the temporary store closures and reduced consumer demand caused by the COVID-19 Impacts. The Group's same store analysis includes existing company-operated retail stores that have been open for at least 12 months before the end of the relevant financial period.

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Total net sales from DTC e-commerce sites in Argentina, Chile, Colombia and Mexico increased by US$0.3 million, or 9.0% (+31.8% constant currency), to US$3.5 million for the year ended December 31, 2020 from US$3.2 million for the year ended December 31, 2019.

Countries

The following table sets forth a breakdown of net sales in Latin America by geographic location for the years ended December 31, 2020 and December 31, 2019, both in absolute terms and as a percentage of total regional net sales.

Notes

1. The geographic location of the Group's net sales generally reflects the country from which its products were sold and does not necessarily indicate the country in which its end consumers were actually located.
2. Excludes sales made to distributors in Brazil from outside the country.
3. The net sales figure for the "Other" geographic location includes sales in Argentina, Colombia, Panama, Peru, Uruguay and sales to third-party distributors outside of Brazil.
4. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

Net sales in Chile decreased by US$24.4 million, or 42.6% (-36.3% constant currency), during the year ended December 31, 2020 compared to the previous year. Net sales in Mexico decreased by US$41.7 million, or 74.1% (-72.6% constant currency), year-on-year.

Cost of Sales and Gross Profit

Cost of sales decreased by US$791.6 million, or 48.8%, to US$830.4 million (representing 54.0% of net sales) for the year ended December 31, 2020 from US$1,622.0 million (representing 44.6% of net sales) for the year ended December 31, 2019 due to the decrease in net sales.

Gross profit decreased by US$1,310.5 million, or 65.0%, to US$706.3 million for the year ended December 31, 2020 from US$2,016.8 million for the year ended December 31, 2019 as a result of the decrease in net sales year-on-year caused by the COVID-19 Impacts. Gross profit margin, as reported, decreased to 46.0% for the year ended December 31, 2020 from 55.4% for the previous year. The decrease in the gross profit margin was primarily related to a decrease in gross profit as a result of the decrease in net sales year-on-year caused primarily by the effects of the COVID-19 Impacts, including the effects of (i) an increased provision for inventory reserves and (ii) fixed sourcing and manufacturing expenses on lower sales, as well as the inclusion of restructuring charges and non-cash impairment charges related to the sourcing and production of the Group's products, along with a shift in sales mix. Excluding the restructuring charges and non-cash impairment charges related to the sourcing and production of the Group's products, the gross profit margin, as adjusted for the year ended December 31, 2020 would have been 46.8%.

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The following table presents the reconciliation from the Group's gross profit, as reported, to gross profit, as adjusted, and the Group's gross profit margin, as reported, to gross profit margin, as adjusted, for the year ended December 31, 2020.

GROSS PROFIT & GROSS PROFIT MARGIN

Additionally, the effects of the increased provision for inventory reserves and the impact of fixed sourcing and manufacturing expenses on lower sales negatively impacted gross profit margin by 350 basis points and 140 basis points year-on-year, respectively, caused by the COVID-19 Impacts. Had the provision for inventory reserves and fixed sourcing and manufacturing expenses remained consistent with 2019 as a percentage of net sales, gross profit margin for the year ended December 31, 2020 would have been 51.7%.

Distribution Expenses

Distribution expenses decreased by US$458.5 million, or 38.1%, to US$744.6 million (representing 48.5% of net sales) for the year ended December 31, 2020 from US$1,203.2 million (representing 33.1% of net sales) for the year ended December 31, 2019. Distribution expenses as a percentage of net sales increased primarily due to the impact of lower net sales. See Directors' Report - Review of Financial Year 2020 - Impact of COVID-19 for further discussion.

Marketing Expenses

The Group spent US$73.3 million on marketing during the year ended December 31, 2020 compared to US$189.5 million for the year ended December 31, 2019, a decrease of US$116.3 million, or 61.3%. As a percentage of net sales, marketing expenses decreased by 40 basis points to 4.8% for the year ended December 31, 2020 from 5.2% for the year ended December 31, 2019. Of the US$73.3 million spent on marketing during the year ended December 31, 2020, the Group spent US$34.7 million on marketing during the first quarter of 2020, before the global spread of COVID-19. The Group aggressively reduced advertising spend during the remainder of 2020 to help offset the negative impacts on its profitability caused by the COVID-19 pandemic.

General and Administrative Expenses

General and administrative expenses decreased by US$29.6 million, or 12.9%, to US$200.0 million (representing 13.0% of net sales) for the year ended December 31, 2020 from US$229.6 million (representing 6.3% of net sales) for the year ended December 31, 2019. The decrease in general and administrative expenses resulted from actions taken by management to reduce the fixed and variable cost structure of the business, including headcount reductions and other savings initiatives, to help offset the negative impacts on the Group's profitability due to the sales declines caused by COVID-19. See Directors' Report - Review of Financial Year 2020 - Impact of COVID-19 for further discussion. General and administrative expenses as a percentage of net sales increased by 670 basis points due to the decrease in net sales year-on- year.

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Impairment Charges

The following table sets forth a breakdown of the non-cash impairment charges for the year ended December 31, 2020 (the "2020 Impairment Charges") and for the year ended December 31, 2019 (the "2019 Impairment Charges").

In accordance with International Accounting Standards ("IAS") 36, Impairment of Assets ("IAS 36"), the Group is required to evaluate its intangible assets with indefinite lives at least annually or when an event has occurred or circumstances change that would more likely than not reduce the recoverable amount of a cash generating unit ("CGU") below its carrying value. The Group is also required to perform a review for impairment indicators at least quarterly on its tangible and intangible assets with finite useful lives. If there is any indication that an asset may be impaired, the Group must estimate the recoverable amount of the asset or CGU.

Due to the negative impacts resulting from the COVID-19 pandemic, certain indefinite-lived intangible assets identified by the Group were tested for impairment during the first quarter of 2020. The Company also completed its annual evaluation during the fourth quarter of 2020. Based on valuations performed by a third-party specialist engaged by the Company, management determined that the carrying value of certain intangible assets exceeded their recoverable amounts, resulting in non-cash impairment charges recognized during 2020 totaling US$744.8 million, comprised of US$496.0 million for goodwill and US$248.8 million for certain tradenames.

Further, based on an evaluation of loss-making stores during the year ended December 31, 2020, and also due to reduced traffic and under-performance caused by the COVID-19 pandemic during 2020, the Group determined that the carrying amounts of certain retail stores, which represent individual CGUs, respectively, exceeded their corresponding recoverable amounts. The Group also recognized impairment charges for certain molds and machinery used in the production of certain luggage product lines during the year ended December 31, 2020 as the carrying amounts exceeded the recoverable amounts. During the year ended December 31, 2020 the Group recognized non-cash impairment charges totaling US$175.5 million, comprised of US$140.3 million for lease right-of-use assets and US$35.3 million for property, plant and equipment, including leasehold improvements.

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During the year ended December 31, 2019, the Group recognized a non-cash impairment charge of US$48.0 million for assets attributable to the ebags business. The Group made a strategic decision to reduce the sales of third-party brands on the ebags e-commerce website to improve profitability. It was further decided to accelerate this shift to focus on Samsonite and the Group's other owned brands, including ebags -branded luggage and bags. As a result of the reduction in net sales of third-party brands through the ebags e-commerce website, it was determined that the carrying amount of its ebags tradename and certain other assets were higher than their respective recoverable amounts, resulting in a US$48.0 million non-cash impairment charge.

Based on an evaluation of loss-making stores during the year ended December 31, 2019 due to under-performance, the Group recognized non-cash impairment charges totaling US$38.4 million, comprised of the write-off of US$27.5 million of lease right-of-use assets associated with such stores and a US$10.9 million non-cash impairment for property, plant and equipment, including leasehold improvements, of such stores.

Restructuring Charges

The following table sets forth a breakdown of the restructuring charges for the year ended December 31, 2020 (the "2020 Restructuring Charges"). The Company did not record any restructuring charges during the year ended December 31, 2019.

Beginning in March 2020, the Group identified and implemented restructuring initiatives aimed at reducing its fixed cost base on a global basis in response to the impact of the COVID-19 pandemic. During the year ended December 31, 2020, the Group recognized the 2020 Restructuring Charges of US$63.0 million primarily for severance costs associated with reductions in personnel, store closure costs and certain other costs incurred to implement profit improvement initiatives. The Group continues to evaluate additional areas to further reduce operating expenses in response to the impacts on the business from the COVID-19 pandemic. See Directors' Report - Review of Financial Year 2020 - Impact of COVID-19 for further discussion.

During the year ended December 31, 2019 the Group recognized US$16.0 million of severance and store closure costs incurred in connection with certain profit improvement initiatives undertaken by the Group's management. These costs were recorded in the Group's consolidated statements of income (loss) in the line item "Other income (expenses)". See Directors' Report - Review of Financial Year 2020 - Other Income (Expenses) for further discussion.

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Other Income (Expenses)

The Group recorded other income of US$15.9 million and other expenses of US$25.1 million for the years ended December 31, 2020 and December 31, 2019, respectively. Other income for 2020 included gains on lease exits/remeasurements of US$17.2 million, partially offset by other expenses of US$1.3 million. Other expenses for 2019 included severance and store closure costs incurred in connection with certain profit improvement initiatives undertaken by the Group's management totaling US$16.0 million.

Operating Profit (Loss)

The following table presents the reconciliation from the Group's operating profit (loss), as reported, to operating profit (loss), as adjusted, for the years ended December 31, 2020 and December 31, 2019.

OPERATING PROFIT (LOSS)

Notes

1. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

The Group incurred an operating loss of US$1,266.2 million for the year ended December 31, 2020, compared to an operating profit of US$283.0 million for the previous year. The Group incurred an operating loss of US$282.9 million when excluding the non-cash 2020 Impairment Charges and 2020 Restructuring Charges, compared to an operating profit of US$385.4 million for the previous year when excluding the non-cash 2019 Impairment Charges and costs related to profit improvement initiatives. The year-on-year decrease in operating profit was primarily due to the decrease in net sales and other negative impacts caused by the COVID-19 Impacts.

Net Finance Costs

Net finance costs increased by US$18.1 million, or 18.4%, to US$116.2 million for the year ended December 31, 2020 from US$98.1 million for the year ended December 31, 2019, primarily due to an increase in interest expense on loans and borrowings of US$32.4 million year-on-year as a result of increased borrowings during 2020 to ensure adequate liquidity as the Group navigated the challenges from COVID-19, and an increase in net foreign exchange losses of US$8.5 million year-on-year, partially offset by a decrease in redeemable non- controlling interest put option expenses of US$18.4 million during the year ended December 31, 2020 compared to the previous year.

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The following table sets forth a breakdown of total finance costs for the years ended December 31, 2020 and December 31, 2019.

Profit (Loss) before Income Tax

The following table presents the reconciliation from the Group's profit (loss) before income tax, as reported, to profit (loss) before income tax, as adjusted, for the years ended December 31, 2020 and December 31, 2019.

PROFIT (LOSS) BEFORE INCOME TAX

Notes

1. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

The Group incurred a loss before income tax of US$1,382.4 million for the year ended December 31, 2020, compared to a profit before income tax of US$184.9 million for the previous year. The Group incurred a loss before income tax of US$399.1 million when excluding the non-cash 2020 Impairment Charges and the 2020 Restructuring Charges incurred during the year ended December 31, 2020, compared to a profit before income tax of US$287.3 million for the previous year when excluding the non-cash 2019 Impairment Charges and the costs to implement profit improvement initiatives. The year-on-year decrease in profit before income tax was primarily due to the decrease in net sales resulting from the negative impacts from the COVID-19 pandemic.

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Income Tax Benefit (Expense)

The Group recorded an income tax benefit of US$94.4 million for the year ended December 31, 2020 compared to an income tax expense of US$31.5 million for the year ended December 31, 2019. The income tax benefit recorded during 2020 was due mainly to the US$1,382.4 million reported loss before income tax caused by the COVID-19 Impacts, changes in reserves and changes in unrecognized deferred tax assets.

Included within the US$94.4 million income tax benefit for the year ended December 31, 2020 were the tax impacts related to the non-deductible goodwill impairment charges of US$122.1 million and the derecognition of deferred tax assets of US$128.1 million.

Deferred tax assets in each jurisdiction are analyzed for recoverability at each reporting date and derecognized to the extent that it is no longer probable that the assets will be utilized in future taxable periods. The analysis considers both positive and negative evidence. Due to the negative impacts from the COVID-19 pandemic and significant losses before income tax reported globally, the Group derecognized certain deferred tax assets which were deemed not probable of realization in the foreseeable future.

For the year ended December 31, 2019, income tax expense was US$31.5 million. Included within the US$31.5 million of income tax expense were the 2019 Net Tax Benefits (as defined below) which were comprised of (i) a non-cash income tax benefit of US$54.6 million from a change in the tax rate applied to intangible assets currently held in Luxembourg, which primarily consist of certain tradenames owned by the Group, (ii) tax expenses of US$29.0 million associated with a legal entity reorganization and (iii) a base erosion tax arising as a result of the 2017 U.S. tax reform that applied to the Group in 2019 (which did not apply to the Group previously) of US$7.4 million. Together, these items resulted in a net tax benefit to the Group of US$18.3 million (the "2019 Net Tax Benefits").

The Group's consolidated effective tax rate for operations was 6.8% and 17.0% for the years ended December 31, 2020 and December 31, 2019, respectively. The decrease in the Group's effective tax rate year-on-year was mainly the result of changes in the profit mix between high and low tax jurisdictions, changes in reserves, changes in unrecognized deferred tax assets and the tax impact from the non-deductible goodwill impairment charges in 2020. The effective tax rate is calculated using a weighted average income tax rate from those jurisdictions in which the Group is subject to tax, adjusted for permanent book/tax differences, tax incentives, changes in tax reserves and changes in unrecognized deferred tax assets.

Excluding the non-deductible goodwill impairment charges in 2020 and the derecognition of deferred tax assets during the year ended December 31, 2020 and excluding the 2019 Net Tax Benefits for the year ended December 31, 2019, the Group's consolidated effective tax rate for operations would have been 24.9% and 26.9% for the years ended December 31, 2020 and December 31, 2019, respectively. The decrease in the Group's effective tax rate was mainly the result of changes in the profit mix between high and low tax jurisdictions and changes in reserves.

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Profit (Loss)

Profit (loss) for the year

The following table presents the reconciliation from the Group's profit (loss) for the year, as reported, to profit (loss) for the year, as adjusted, for the years ended December 31, 2020 and December 31, 2019.

PROFIT (LOSS) FOR THE YEAR

Notes

1. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

The Group incurred a loss for the year ended December 31, 2020 of US$1,288.0 million, compared to a profit for the year ended December 31, 2019 of US$153.4 million. The Group incurred a loss for the year ended December 31, 2020 of US$424.1 million when excluding the non-cash 2020 Impairment Charges and the 2020 Restructuring Charges, both of which are net of the related tax impact, compared to a profit for the year ended December 31, 2019 of US$211.0 million when excluding the non-cash 2019 Impairment Charges and the costs related to profit improvement initiatives, both of which are net of the related tax impact, and 2019 Net Tax Benefits. The year-on-year decrease in profit (loss) for the year was primarily due to the COVID-19 Impacts.

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Profit (loss) attributable to the equity holders

The following table presents the reconciliation from the Group's profit (loss) attributable to the equity holders, as reported, to profit (loss) attributable to the equity holders, as adjusted, for the years ended December 31, 2020 and December 31, 2019.

PROFIT (LOSS) ATTRIBUTABLE TO THE EQUITY HOLDERS

Notes

1. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

The Group incurred a loss attributable to the equity holders of US$1,277.7 million for the year ended December 31, 2020, compared to profit attributable to the equity holders of US$132.5 million for the previous year. The Group incurred a loss attributable to the equity holders of US$413.8 million when excluding the non-cash 2020 Impairment Charges and the 2020 Restructuring Charges, both of which are net of the related tax impact, for the year ended December 31, 2020, compared to a profit attributable to the equity holders of US$190.1 million when excluding the non-cash 2019 Impairment Charges and the costs related to profit improvement initiatives, both of which are net of the related tax impact, and 2019 Net Tax Benefits for the year ended December 31, 2019. The year-on-year decrease in profit (loss) attributable to the equity holders was primarily due to the COVID-19 Impacts.

Basic and diluted earnings (loss) per share

Basic and diluted loss per share was US$0.891 for the year ended December 31, 2020, compared to basic and diluted earnings per share of US$0.093 for the year ended December 31, 2019. The weighted average number of shares utilized in the basic earnings (loss) per share calculation was 1,433,422,967 shares for the year ended December 31, 2020 compared to 1,431,362,284 shares for the year ended December 31, 2019. The weighted average number of shares outstanding utilized in the diluted earnings (loss) per share calculation was 1,433,422,967 shares for the year ended December 31, 2020 compared to 1,433,040,571 shares for the year ended December 31, 2019.

Basic and diluted loss per share, as adjusted, was US$0.289 when excluding the non-cash 2020 Impairment Charges and 2020 Restructuring Charges, both of which are net of the related tax impact, for the year ended December 31, 2020, compared to basic and diluted earnings per share, as adjusted, of US$0.133 when excluding the non-cash 2019 Impairment Charges and

- 25 -

the costs to implement profit improvement initiatives, both of which are net of the related tax impact, and the 2019 Net Tax Benefits for the year ended December 31, 2019. The year-on- year decrease was caused by the COVID-19 Impacts on the Group's business.

Adjusted EBITDA

Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"), a non-IFRS measure, decreased by US$711.0 million, or 144.4% (-145.6% constant currency), to a loss of US$218.8 million for the year ended December 31, 2020 compared to earnings of US$492.2 million for the year ended December 31, 2019. Adjusted EBITDA margin was (14.2%) for the year ended December 31, 2020 compared to 13.5% for the year ended December 31, 2019 due primarily to the COVID-19 Impacts. The Group took meaningful actions in 2020 to implement cost savings initiatives in an effort to improve profitability. See Impact of COVID-19 section in Directors' Report - Review of Financial Year 2020 for further discussion.

The following table presents the reconciliation from the Group's profit (loss) for the year to Adjusted EBITDA for the years ended December 31, 2020 and December 31, 2019:

Notes

1. Other adjustments primarily comprised 'Other income (expenses)' per the consolidated statements of income (loss).
2. Adjusted EBITDA, a non-IFRS measure, eliminates the effect of a number of costs, charges and credits and certain other non-cash charges. Adjusted EBITDA includes the lease interest and amortization expense as a result of the Group's adoption of IFRS 16, Leases ("IFRS 16") on January 1, 2019 to account for operational rent expenses.
3. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

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The following tables present reconciliations from profit (loss) for the year to Adjusted EBITDA on a regional basis for the years ended December 31, 2020 and December 31, 2019:

Notes

1. Inter-companycharges (income) by region include intra-group royalty income/expense and other cross- charges that eliminate in consolidation.
2. Other adjustments primarily comprised 'Other income (expenses)' per the consolidated statements of income (loss).
3. Adjusted EBITDA, a non-IFRS measure, eliminates the effect of a number of costs, charges and credits and certain other non-cash charges. Adjusted EBITDA includes the lease interest and amortization expense as a result of the Group's adoption of IFRS 16 on January 1, 2019 to account for operational rent expenses.

nm Not meaningful.

- 27 -

Notes

1. Inter-companycharges (income) by region include intra-group royalty income/expense and other cross- charges that eliminate in consolidation.
2. Other adjustments primarily comprised 'Other income (expenses)' per the consolidated statements of income (loss).
3. Adjusted EBITDA, a non-IFRS measure, eliminates the effect of a number of costs, charges and credits and certain other non-cash charges. Adjusted EBITDA includes the lease interest and amortization expense as a result of the Group's adoption of IFRS 16 on January 1, 2019 to account for operational rent expenses.

nm Not meaningful.

The Company has presented EBITDA, Adjusted EBITDA and Adjusted EBITDA margin because it believes that, when viewed with its results of operations as prepared in accordance with IFRS and with the reconciliation to profit (loss) for the year, these measures provide additional information that is useful in gaining a more complete understanding of its operational performance and of the trends impacting its business. EBITDA, Adjusted EBITDA and Adjusted EBITDA margin are important metrics the Group uses to evaluate its operating performance and cash generation.

EBITDA, Adjusted EBITDA and Adjusted EBITDA margin are non-IFRS financial measures and as calculated herein may not be comparable to similarly named measures used by other companies and should not be considered comparable to profit (loss) for the year in the Company's consolidated statements of income (loss). These measures have limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, an analysis of the Company's results of operations as reported under IFRS.

Adjusted Net Income (Loss)

Adjusted Net Income (Loss), a non-IFRS measure, was a loss of US$406.1 million for the year ended December 31, 2020, compared to income of US$215.9 million for the year ended December 31, 2019 due to the COVID-19 Impacts. Adjusted basic and diluted earnings (loss) per share, non-IFRS measures, was a loss of US$0.283 per share for the year ended December 31, 2020, compared to earnings per share of US$0.151 for the year ended December 31,

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2019. Adjusted basic and diluted earnings (loss) per share is calculated by dividing Adjusted Net Income (Loss) by the weighted average number of shares used in the basic and diluted earnings (loss) per share calculations, respectively.

The following table presents the reconciliation from the Group's profit (loss) attributable to the equity holders to Adjusted Net Income (Loss) for the years ended December 31, 2020 and December 31, 2019:

Notes

1. Tax adjustments represent the tax effect of the reconciling line items as included in the consolidated statements of income (loss) based on the applicable tax rate in the jurisdiction where such costs were incurred.
2. Represents Adjusted Net Income (Loss) attributable to the equity holders of the Company.
3. Results stated on a constant currency basis, a non-IFRS measure, are calculated by applying the average exchange rate of the previous year to current year local currency results.

The Company has presented Adjusted Net Income (Loss) and adjusted basic and diluted earnings (loss) per share because it believes these measures help to give securities analysts, investors and other interested parties a better understanding of the Company's underlying financial performance. By presenting Adjusted Net Income (Loss) and the related adjusted basic and diluted earnings (loss) per share calculations, the Company eliminates the effect of a number of costs, charges and credits and certain other non-cash charges, along with their respective tax effects, that impact reported profit (loss) attributable to the equity holders.

Adjusted Net Income (Loss) and adjusted basic and diluted earnings (loss) per share are non- IFRS financial measures, and as calculated herein may not be comparable to similarly named measures used by other companies and should not be considered comparable to profit (loss) attributable to the equity holders or basic and diluted earnings (loss) per share presented in the Company's consolidated statements of income (loss). Adjusted Net Income (Loss) and the related adjusted basic and diluted earnings (loss) per share calculations have limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, an analysis of the Company's results of operations as reported under IFRS.

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Liquidity and Capital Resources

The primary objectives of the Company's capital management policies are to safeguard its ability to continue as a going concern, to provide returns for the Company's shareholders, and to fund capital expenditures, normal operating expenses, working capital needs and the payment of obligations (see Directors' Report - Review of Financial Year 2020 - Impact of COVID-19 for further discussion). The Group's primary sources of liquidity are its cash flows from operating activities, invested cash, available lines of credit and, subject to shareholder approval, the Company's ability to issue additional shares. The Company believes that its existing cash and estimated cash flows, along with current working capital, will be adequate to meet the foreseeable future operating and capital requirements of the Group at least through March 31, 2022.

Net cash flows used in operating activities amounted to US$114.2 million for the year ended December 31, 2020 compared to net cash flows generated from operating activities of US$576.2 million for the year ended December 31, 2019. The decrease in cash flows from operating activities year-on-year was due to the COVID-19 Impacts.

For the year ended December 31, 2020, net cash flows used in investing activities were US$26.1 million and were primarily related to US$20.6 million of capital expenditures for property, plant and equipment, primarily related to investments in machinery and equipment. For the year ended December 31, 2019, net cash flows used in investing activities were US$73.1 million and were primarily related to US$55.4 million of capital expenditures for property, plant and equipment, including the addition of new retail locations, remodeling existing retail locations and investments in machinery and equipment. The Group took meaningful measures to reduce capital expenditures during 2020 in response to the impacts on the Group's business from the COVID-19 pandemic.

Net cash flows provided by financing activities were US$1,158.4 million for the year ended December 31, 2020 and were largely attributable to funds borrowed under the 2020 Incremental Term Loan B Facility (as defined in the Indebtedness section below) in an aggregate principal amount of US$600.0 million, as well as from US$810.3 million (USD equivalent at the applicable exchange rate on the borrowing date) borrowed under the Amended Revolving Credit Facility (as defined in the Indebtedness section below). Net cash flows used in financing activities were US$465.1 million for the year ended December 31, 2019 and were largely attributable to principal payments on lease liabilities of US$170.2 million, payments of Term Loan Credit Facilities (as defined in the Indebtedness section below) totaling US$127.5 million, the distribution to shareholders of US$125.0 million, payments on current loans and borrowings of US$27.6 million and dividend payments to non-controlling interests of US$13.0 million.

The Group had US$1,495.0 million in cash and cash equivalents as of December 31, 2020, compared to US$462.6 million as of December 31, 2019. No cash and cash equivalents were restricted as of December 31, 2020 and December 31, 2019. Cash and cash equivalents are generally denominated in the functional currency of the respective Group entity.

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Indebtedness

The following table sets forth the carrying amount of the Group's loans and borrowings as of December 31, 2020 and December 31, 2019:

Note

1. The value of the Senior Notes, when translated from Euros into US Dollars, will change relative to the fluctuation in the exchange rate between the Euro and US Dollar at stated points in time.

Amended and Restated Senior Credit Facilities Agreement

On May 13, 2016, the Company and certain of its direct and indirect wholly-owned subsidiaries entered into a credit and guaranty agreement (the "Original Senior Credit Facilities Agreement") with certain lenders and financial institutions. The Original Senior Credit Facilities Agreement provided for (1) a US$1,250.0 million senior secured term loan A facility (the "Original Term Loan A Facility"), (2) a US$675.0 million senior secured term loan B facility (the "Original Term Loan B Facility" and, together with the Original Term Loan A Facility, the "Original Term Loan Facilities") and (3) a US$500.0 million revolving credit facility (the "Original Revolving Credit Facility," and, together with the Original Term Loan Facilities, the "Original Senior Credit Facilities").

In conjunction with the offering of the Senior Notes (as defined below), on April 25, 2018, the Company and certain of its direct and indirect wholly-owned subsidiaries entered into an amended and restated credit and guaranty agreement (the "Credit Agreement") with certain lenders and financial institutions. The Credit Agreement provided for (1) a US$828.0 million senior secured term loan A facility (the "Term Loan A Facility"), (2) a US$665.0 million senior secured term loan B facility (the "Term Loan B Facility" and, together with the Term Loan A Facility, the "Term Loan Credit Facilities") and (3) a US$650.0 million revolving credit facility (the "Revolving Credit Facility," and, together with the Term Loan Credit Facilities, the "Senior Credit Facilities").

Interest Rate and Fees

Interest on the borrowings under the Term Loan Credit Facilities and the Revolving Credit Facility began to accrue on April 25, 2018 when the closing on the Senior Credit Facilities occurred (the "Closing Date"). Under the terms of the Senior Credit Facilities:

1. in respect of the Term Loan A Facility and the Revolving Credit Facility, (i) prior to the Second Amended Credit Agreement (discussed further below), the interest rate payable was set with effect from the Closing Date until the delivery of the consolidated financial statements for the fiscal quarter ended September 30, 2018 at the London Interbank Offered Rate ("LIBOR") plus 1.50% per annum (or a base rate plus 0.50% per annum)

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and thereafter is based on the lower rate derived from either the first lien net leverage ratio of the Company and its restricted subsidiaries at the end of each fiscal quarter or the Company's corporate ratings and (ii) after the Second Amended Credit Agreement, the interest rate payable was set with effect from the date of the Second Amended Credit Agreement until the delivery of the consolidated financial statements for the fiscal quarter ended June 30, 2020 at LIBOR plus 1.375% per annum (or a base rate plus 0.375% per annum) and thereafter is based on the lower rate derived from either the first lien net leverage ratio of the Company and its restricted subsidiaries at the end of each fiscal quarter or the Company's corporate ratings (subject to the terms of the Third Amended Credit Agreement as described below); and

1. in respect of the Term Loan B Facility, the interest rate payable was set with effect from the Closing Date at LIBOR plus 1.75% per annum with a LIBOR floor of 0.00% (or a base rate plus 0.75% per annum) (subject to the terms of the Third Amended Credit Agreement as described below).

In addition to paying interest on outstanding principal under the Senior Credit Facilities, the borrowers pay customary agency fees and a commitment fee in respect of the unutilized commitments under the Revolving Credit Facility. The commitment fee payable with effect from the Closing Date until the delivery of the consolidated financial statements for the fiscal quarter ended September 30, 2018 was 0.20% per annum. The commitment fee payable thereafter is based on the lower rate derived from either the first lien net leverage ratio of the Company and its restricted subsidiaries at the end of each fiscal quarter or the Company's corporate ratings, as applicable. After the Second Amended Credit Agreement, the commitment fee payable with effect from the effective date of the Second Amended Credit Agreement until the delivery of the consolidated financial statements for the fiscal quarter ended June 30, 2020 is 0.20% per annum and the commitment fee payable thereafter may step up based on the lower rate derived from either the first lien net leverage ratio of the Company and its restricted subsidiaries at the end of each fiscal quarter or the Company's corporate ratings, as applicable (subject to the terms of the Third Amended Credit Agreement as described below).

Amortization and Final Maturity

Prior to the Second Amended Credit Agreement, the Term Loan A Facility required scheduled quarterly payments commencing on the first full fiscal quarter ended after the Closing Date, with an annual amortization of 2.5% of the original principal amount of the loans under the Term Loan A Facility made during each of the first and second years, with a step-up to 5.0% annual amortization during each of the third and fourth years and 7.5% annual amortization during the fifth year, with the balance due and payable on the fifth anniversary of the Closing Date.

The Second Amended Credit Agreement requires scheduled quarterly payments commencing on the first full fiscal quarter ended after the Second Amendment Closing Date (as defined below), with an annual amortization of 2.5% of the original principal amount of the loans under the Amended Term Loan A Facility (as defined below) made during each of the first and second years, with a step-up to 5.0% annual amortization during each of the third and fourth years and 7.5% annual amortization during the fifth year, with the balance due and payable on the fifth anniversary of the Second Amendment Closing Date (as defined below).

The Term Loan B Facility requires scheduled quarterly payments commencing on the quarter ended September 30, 2018, each equal to 0.25% of the original principal amount of the loans under the Term Loan B Facility, with the balance due and payable on the seventh anniversary of the Closing Date.

There is no scheduled amortization of the principal amounts of the loans outstanding under the Revolving Credit Facility. Prior to the Second Amended Credit Agreement, any principal amount outstanding under the Revolving Credit Facility was due and payable on the fifth anniversary of the Closing Date. After the Second Amended Credit Agreement, any principal amount outstanding under the Amended Revolving Credit Facility (as defined below) is due and payable on the fifth anniversary of the Second Amendment Closing Date (as defined below).

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If, on the date that is 91 days prior to the maturity date of the Term Loan B Facility, more than US$50.0 million of the Term Loan B Facility has not been repaid or refinanced pursuant to the terms provided for in the Credit Agreement, then the Amended Term Loan A Facility (as defined below) and Amended Revolving Credit Facility (as defined below) shall mature on the date that is 90 days prior to the maturity date of the Term Loan B Facility.

Guarantees and Security

The obligations of the borrowers under the Senior Credit Facilities are unconditionally guaranteed by the Company and certain of the Company's existing direct or indirect wholly- owned material restricted subsidiaries, and are required to be guaranteed by certain future direct or indirect wholly-owned material restricted subsidiaries organized in the jurisdictions of Luxembourg, Belgium, Canada, Hong Kong, Hungary, Mexico and the United States (the "Credit Facility Guarantors"). All obligations under the Senior Credit Facilities, and the guarantees of those obligations, are secured, subject to certain exceptions, by substantially all of the assets of the borrowers and the Credit Facility Guarantors (including the Shared Collateral).

Certain Covenants and Events of Default

The Senior Credit Facilities contain a number of customary negative covenants that, among other things and subject to certain exceptions, may restrict the ability of the Company and each of its restricted subsidiaries to: (i) incur additional indebtedness; (ii) pay dividends or distributions on its capital stock or redeem, repurchase or retire its capital stock or its other indebtedness; (iii) make investments, loans and acquisitions; (iv) engage in transactions with its affiliates; (v) sell assets, including capital stock of its subsidiaries; (vi) consolidate or merge; (vii) materially alter the business it conducts; (viii) incur liens; and (ix) prepay or amend any junior debt or subordinated debt.

In addition, the Credit Agreement requires the Company and its subsidiaries to meet certain quarterly financial covenants. Commencing with the fiscal quarter ended September 30, 2018, the Company and its subsidiaries are required to maintain (i) a pro forma total net leverage ratio of not greater than 5.50:1.00, which ratio will decrease to 5.25:1.00 for test periods ending in 2020, 5.00:1.00 for test periods ending in 2021 and 4.50:1.00 for test periods ending in 2022; provided that such maximum pro forma total net leverage ratio is subject to a step up of 0.50x from the otherwise applicable ratio, up to a pro forma total net leverage ratio not to exceed 6.00:1.00 for the six fiscal quarter period following the fiscal quarter in which a permitted acquisition has been consummated, and (ii) a pro forma consolidated cash interest coverage ratio of not less than 3.00:1.00 (collectively, the "Financial Covenants"). The Financial Covenants only apply for the benefit of the lenders under the Term Loan A Facility and the lenders under the Revolving Credit Facility. The Company's requirement to comply with the Financial Covenants has been temporarily suspended during the Suspension Period (as defined below) pursuant to the Third Amended Credit Agreement (see below for further discussion). The Credit Agreement also contains certain customary representations and warranties, affirmative covenants and provisions relating to events of default (including upon a change of control).

Second Amended Credit Agreement

On March 16, 2020 (the "Second Amendment Closing Date"), the Company and certain of its direct and indirect wholly-owned subsidiaries entered into the Second Amended Credit Agreement. The Second Amended Credit Agreement provides for (1) an amended US$800.0 million senior secured term loan A facility (the "Amended Term Loan A Facility") and (2) an amended US$850.0 million revolving credit facility (the "Amended Revolving Credit Facility"). Under the Second Amended Credit Agreement, the maturity for both the Amended Term Loan A Facility and the Amended Revolving Credit Facility were extended by approximately two years with remaining balances on both facilities due to be paid in full on the fifth anniversary of the Second Amendment Closing Date. Interest on the borrowings under the Amended Term Loan A Facility and the Amended Revolving Credit Facility began to accrue on the Second Amendment Closing Date.

- 33 -

The Amended Term Loan A Facility requires scheduled quarterly payments commencing on the first full fiscal quarter ended after the Second Amendment Closing Date, with an annual amortization of 2.5% of the original principal amount of the loans under the Amended Term Loan A Facility made during each of the first and second years, with a step-up to 5.0% annual amortization during each of the third and fourth years and 7.5% annual amortization during the fifth year, with the balance due and payable on the fifth anniversary of the Second Amendment Closing Date. Any principal amount outstanding under the Amended Revolving Credit Facility is due and payable on the fifth anniversary of the Second Amendment Closing Date. If, on the date that is 91 days prior to the maturity date of the Term Loan B Facility, more than US$50.0 million of the Term Loan B Facility has not been repaid or refinanced pursuant to the terms provided for in the Credit Agreement, then the Amended Term Loan A Facility and the Amended Revolving Credit Facility shall mature on the date that is 90 days prior to the maturity date of the Term Loan B Facility.

Under the terms of the Second Amended Credit Agreement, the interest rate payable on the Amended Term Loan A Facility and the Amended Revolving Credit Facility was reduced with effect from the Second Amendment Closing Date until the delivery of the financial statements for the first full fiscal quarter commencing on or after the Second Amendment Closing Date from an adjusted rate based on LIBOR plus 1.50% per annum (or a base rate plus 0.50% per annum) to LIBOR plus 1.375% per annum (or a base rate plus 0.375% per annum) and thereafter is based on the lower rate derived from either the first lien net leverage ratio of the Company and its restricted subsidiaries at the end of each fiscal quarter or the Company's corporate ratings. The interest rate payable on the Amended Term Loan A Facility and the Amended Revolving Credit Facility was subsequently increased on a temporary basis pursuant to the Third Amended Credit Agreement (see below for further discussion).

The Second Amended Credit Agreement did not affect the terms of the Term Loan B Facility.

The borrowers pay customary agency fees and a commitment fee equal to 0.20% per annum in respect of the unutilized commitments under the Amended Revolving Credit Facility, which commitment fee may step up based on the lower rate derived from either the first lien net leverage ratio of the Company and its restricted subsidiaries at the end of each fiscal quarter or the Company's corporate ratings, as applicable commencing with the first full fiscal quarter ended after the Second Amendment Closing Date. Such commitment fee was temporarily increased pursuant to the Third Amended Credit Agreement (see below for further discussion).

The Second Amended Credit Agreement was accounted for as a modification to the Credit Agreement. The previously existing deferred financing costs will continue to be amortized over the life of the Credit Agreement.

Third Amended Credit Agreement

On April 29, 2020, the Company and certain of its direct and indirect wholly-owned subsidiaries entered into the Third Amended Credit Agreement with certain lenders and financial institutions. The terms of the Third Amended Credit Agreement further strengthened the Company's financial flexibility in order to navigate the challenges from COVID-19. Under the terms of the Third Amended Credit Agreement:

1. The Company's requirement to test the maximum total net leverage ratio and minimum interest coverage ratio under its Financial Covenants is suspended from the beginning of the second quarter of 2020 through the end of the second quarter of 2021 (the "Suspension Period"). Following the Suspension Period, the Company will resume testing compliance with the total net leverage ratio and interest coverage ratio covenants beginning with the end of the third quarter of 2021.
2. During the Suspension Period, the Company is required to comply with a minimum liquidity covenant of US$500.0 million and the Group is subject to additional restrictions on its ability to incur indebtedness and make restricted payments and investments.

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1. During the Suspension Period, the interest rate applicable to the Amended Term Loan A Facility and the Amended Revolving Credit Facility, as defined in the Second Amended Credit Agreement, was increased to LIBOR plus 2.00% per annum with a LIBOR floor of 0.75% and the commitment fee in respect of the unutilized commitments under the Amended Revolving Credit Facility was increased to 0.35% per annum.
2. The Company may elect to reinstate the pre-amendment covenants and pricing terms prior to the end of the Suspension Period.
3. From September 30, 2021 until March 31, 2022, the Company may at its election use Consolidated Adjusted EBITDA (as defined in the Third Amended Credit Agreement) from the first two quarters of 2019 and fourth quarter of 2019 (the "Historical EBITDA") (instead of actual Consolidated Adjusted EBITDA from the fourth quarter of 2020 and the first two quarters of 2021) to calculate compliance with the Financial Covenants under the Third Amended Credit Agreement. So long as the Company uses Historical EBITDA to calculate compliance with the Financial Covenants, the minimum liquidity covenant and the Suspension Period pricing terms will remain in effect.

The Third Amended Credit Agreement was accounted for as a modification to the Credit Agreement. The previously existing deferred financing costs will continue to be amortized over the life of the Credit Agreement.

Fourth Amended Credit Agreement - Incremental US$600.0 Million Term Loan B Facility

On May 7, 2020 (the "2020 Incremental Term Loan B Facility Closing Date"), the Company and certain of its direct and indirect wholly-owned subsidiaries entered into the Fourth Amended Credit Agreement with certain lenders and financial institutions. The Fourth Amended Credit Agreement provides for an additional term loan B facility in an aggregate principal amount of US$600.0 million (the "2020 Incremental Term Loan B Facility"), which was borrowed by certain indirect, wholly-owned subsidiaries of the Company on May 7, 2020. The 2020 Incremental Term Loan B Facility was issued with original issue discount with an issue price of 97.00%. The proceeds from the borrowing under the 2020 Incremental Term Loan B Facility were used to

1. provide the Group with additional cash resources (which may be used for general corporate purposes and for working capital needs) and (ii) pay certain fees and expenses in connection thereto.

Interest Rate and Fees

Interest on the borrowings under the 2020 Incremental Term Loan B Facility began to accrue on the 2020 Incremental Term Loan B Facility Closing Date. Under the terms of the 2020 Incremental Term Loan B Facility, the interest rate payable was set with effect from the 2020 Incremental Term Loan B Facility Closing Date at LIBOR plus 4.50% per annum with a LIBOR floor of 1.00% (or a base rate plus 3.50% per annum).

Amortization and Final Maturity

The 2020 Incremental Term Loan B Facility requires scheduled quarterly payments equal to 0.25% of the original principal amount of the loans thereunder beginning with the fiscal quarter ending September 30, 2020, with the balance due and payable on April 25, 2025.

Optional Prepayment

If the Group prepays the 2020 Incremental Term Loan B Facility in whole or in part on or prior to May 7, 2021, the Group will be required to pay to the lenders a "make-whole" premium on the amount of the 2020 Incremental Term Loan B Facility that is prepaid. If the Group prepays the 2020 Incremental Term Loan B Facility in whole or in part after May 7, 2021 and on or before May 7, 2022, the Group will be required to pay to the lenders a fee equal to 1.00% of the aggregate principal amount of the amount of the 2020 Incremental Term Loan B Facility that is prepaid.

- 35 -

Minimum Liquidity Covenant

The 2020 Incremental Term Loan B Facility requires the Company to comply with a minimum liquidity covenant of US$200.0 million through the third quarter of 2021, stepping down to US$100.0 million thereafter until repayment in full of the 2020 Incremental Term Loan B Facility.

Other Terms

Except as described above, the other terms of the 2020 Incremental Term Loan B Facility are the same as the terms of the Term Loan B Facility.

In conjunction with the issuance of the 2020 Incremental Term Loan B Facility, the Group incurred borrowing fees and expenses that will be deferred and amortized over the term of the 2020 Incremental Term Loan B Facility.

Amended Revolving Credit Facility

On March 20, 2020, the Company borrowed US$810.3 million (USD equivalent at the applicable exchange rate on the borrowing date) under the Amended Revolving Credit Facility to ensure access to the Group's liquidity given the uncertainties and challenges caused by the COVID-19 pandemic. As of December 31, 2020, US$23.4 million was available to be borrowed on the Amended Revolving Credit Facility as a result of US$822.2 million of outstanding borrowings and the utilization of US$4.5 million of the facility for outstanding letters of credit extended to certain creditors.

As of December 31, 2019, US$647.0 million was available to be borrowed under the US$650.0 million Revolving Credit Facility because there were no outstanding borrowings under such facility and US$3.0 million of such facility had been utilized for outstanding letters of credit extended to certain creditors.

Deferred Financing Costs

In conjunction with the second, third and fourth amendments to the Senior Credit Facilities, the Group incurred US$34.8 million of deferred financing costs during the year ended December 31, 2020. All such costs have been deferred and are being offset against loans and borrowings. The deferred financing costs are being amortized using the effective interest method over the life of the Amended Term Loan A Facility, Amended Revolving Credit Facility and Incremental Term Loan B Facility. The amortization of deferred financing costs, which is included in interest expense, amounted to US$7.7 million and US$3.6 million for the years ended December 31, 2020 and December 31, 2019, respectively.

Interest Rate Swaps

The Group maintains interest rate swaps to hedge a portion of its interest rate exposure under the floating-rate Senior Credit Facilities by swapping certain US Dollar floating-rate bank borrowings with fixed-rate agreements. On September 4, 2019, the Group entered into new interest rate swap agreements that became effective on September 6, 2019 and will terminate on August 31, 2024. The notional amounts of the interest rate swap agreements decrease over time. As a result of the Group's interest rate swaps, LIBOR has been fixed at approximately 1.208% with respect to an amount equal to approximately 27% of the principal amount of the Amended Senior Credit Facilities at December 31, 2020, which reduces a portion of the Company's exposure to interest rate increases. The interest rate swap agreements have fixed payments due monthly that commenced September 30, 2019. The interest rate swap transactions qualify as cash flow hedges. As of December 31, 2020, the interest rate swaps were marked-to-market, resulting in a net liability position to the Group in the amount of US$21.2 million, which was recorded as a liability with the effective portion of the gain (loss) deferred to other comprehensive income. As of December 31, 2019, the interest rate swaps were marked-to-market, resulting in a net asset position to the Group in the amount of US$10.6 million, which was recorded as an asset with the effective portion of the gain (loss) deferred to other comprehensive income.

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€350.0 Million 3.500% Senior Notes Due 2026

On April 25, 2018 (the "Issue Date"), Samsonite Finco S.à r.l., a wholly-owned, indirect subsidiary of the Company (the "Issuer"), issued €350.0 million aggregate principal amount of its 3.500% senior notes due 2026 (the "Senior Notes"). The Senior Notes were issued at par pursuant to an indenture (the "Indenture"), dated the Issue Date, among the Issuer, the Company and certain of its direct or indirect wholly-owned subsidiaries (together with the Company, the "Guarantors").

Maturity, Interest and Redemption

The Senior Notes will mature on May 15, 2026. Interest on the aggregate outstanding principal amount of the Senior Notes accrues at a fixed rate of 3.500% per annum, payable semi- annually in cash in arrears on May 15 and November 15 each year.

At any time prior to May 15, 2021, the Issuer may redeem some or all of the Senior Notes at a price equal to 100% of the principal amount of the Senior Notes redeemed plus accrued and unpaid interest to (but excluding) the redemption date at a "make-whole" premium, which is the present value of all remaining scheduled interest payments to the redemption date using the discount rate (as specified in the Indenture) as of the redemption date plus 50 basis points.

On or after May 15, 2021, the Issuer may redeem all, or from time to time a part, of the Senior Notes at the following redemption prices (expressed as a percentage of the principal amount) plus accrued and unpaid interest and additional amounts, if any, to the applicable redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve-month period commencing on May 15 of the years set forth below:

In addition, at any time prior to May 15, 2021, the Issuer may redeem up to 40% of the Senior Notes with the net proceeds of one or more specified equity offerings at a redemption price of 103.500% of the principal amount of the Senior Notes redeemed, plus accrued and unpaid interest and additional amounts, if any, to the date of redemption. Furthermore, in the event of certain events defined as constituting a change of control, the Issuer may be required to make an offer to purchase the Senior Notes.

Guarantee and Security

The Senior Notes are guaranteed by the Guarantors on a senior subordinated basis. The Senior Notes are secured by a second-ranking pledge over the shares of the Issuer and a second- ranking pledge over the Issuer's rights in the proceeds loan in respect of the proceeds of the offering of the Senior Notes (the "Shared Collateral"). The Shared Collateral also secures the Amended Senior Credit Facilities on a first-ranking basis.

Certain Covenants and Events of Default

The Indenture contains a number of customary negative covenants that, among other things and subject to certain exceptions, may restrict the ability of the Company and its restricted subsidiaries (including the Issuer) to: (i) incur or guarantee additional indebtedness, (ii) make investments or other restricted payments, (iii) create liens, (iv) sell assets and subsidiary stock, (v) pay dividends or make other distributions or repurchase or redeem the capital stock or subordinated debt of the Company or its restricted subsidiaries, (vi) engage in certain transactions with affiliates, (vii) enter into agreements that restrict the payment of dividends by subsidiaries or the repayment of inter-company loans and advances, (viii) engage in mergers or consolidations and (ix) impair the security interests in the Shared Collateral. The Indenture also contains certain customary provisions relating to events of default.

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Other Loans and Borrowings

Certain consolidated subsidiaries of the Company maintain credit lines and other loans with various third-party lenders in the regions in which they operate. Other loans and borrowings are generally variable rate instruments denominated in the functional currency of the borrowing Group entity. These credit lines provide short-term financing and working capital for the day- to-day business operations of certain Group entities, including overdraft, bank guarantees, and trade finance facilities. The majority of the credit lines included in other loans and borrowings are uncommitted facilities. The total aggregate amount of other loans and borrowings was US$47.8 million and US$23.6 million as of December 31, 2020 and December 31, 2019, respectively. The uncommitted available facilities amounted to US$105.6 million and US$134.9 million as of December 31, 2020 and December 31, 2019, respectively.

The following represents the contractual maturity dates of the Group's loans and borrowings as of December 31, 2020 and December 31, 2019:

Hedging

The Company's non-U.S. subsidiaries periodically enter into forward contracts related to the purchase of inventories denominated primarily in US Dollars which are designated as cash flow hedges. Cash outflows associated with these derivatives as of December 31, 2020 are expected to be US$84.7 million within one year.

Other Financial Information

Capital Expenditures

Historical Capital Expenditures

The following table sets forth the Group's capital expenditures for the years ended December 31, 2020 and December 31, 2019:

Capital expenditures during the year ended December 31, 2020 were primarily related to investments in machinery and equipment. The year-on-year decrease in total capital expenditures was primarily due to the Group taking meaningful measures to reduce capital expenditures in response to the impacts on the Group's business from the COVID-19 pandemic.

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Planned Capital Expenditures

The Group's capital expenditures budget for 2021 is approximately US$39.5 million. The Group plans to refurbish existing retail stores, invest in new product development and upgrade its existing data center, telecommunications and warehouse management systems. Actual capital expenditures in 2021 may be impacted based on the Group's recovery from COVID-19.

Contractual Obligations

The following table summarizes scheduled maturities of the Group's contractual obligations for which cash flows are fixed and determinable as of December 31, 2020:

As of December 31, 2020, the Group did not have any material off-balance sheet arrangements or contingencies except as included in the table summarizing its contractual obligations above.

Significant Investments Held, Material Acquisitions and Disposals of Subsidiaries

There were no significant investments held that represented 5% or more of the Group's total assets and no material acquisitions or disposals of subsidiaries during the year ended December 31, 2020.

2. Principal Risks and Uncertainties

Details of principal risks and uncertainties can be found in note 22 of the consolidated financial statements.

In terms of financial guarantees, the Company's policy is to provide financial guarantees only on behalf of subsidiaries. No other guarantees have been made to third parties.

3. Effectiveness of Risk Management and Internal Control

The Board places great importance on risk management and internal control and is responsible for ensuring that the Company maintains sound and effective systems of risk management and internal control.

The Company's internal audit department reviews the adequacy and effectiveness of the risk management and internal control systems. Each year the internal and external audit plans are discussed with, and approved by, the Audit Committee.

The Board has reviewed the overall effectiveness of the Company's systems of risk management and internal control for the year ended December 31, 2020. The Board has delegated to the Audit Committee responsibility for reviewing the Company's systems of risk management and internal control and reporting the committee's findings to the Board. In conducting such review, the Audit Committee, on behalf of the Board, has (i) reviewed the Company's internal audit activities during the year and discussed such activities and the results thereof with the Company's Vice President of Internal Audit, (ii) reviewed and discussed the scope and results of the annual audit with the Company's external auditors, (iii) reviewed the results of management's control self-assessment process with management and the Company's Vice President of Internal Audit, (iv) reviewed the results of the Company's risk assessment with

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management and the Company's Vice President of Internal Audit, and (v) reviewed with management the results of the Company's internal management representation process that was performed in connection with the preparation of the Company's consolidated financial statements. Based on its review, the Board confirms, and management has also confirmed to the Board, that the Company's risk management and internal control systems are effective and adequate.

4. Financial Risk Management and Hedging

Details of financial risk management can be found in note 22 of the consolidated financial statements.

The Company's non-U.S. subsidiaries periodically enter into forward contracts related to the purchase of inventories denominated primarily in US Dollars which are designated as cash flow hedges. Cash outflows associated with these derivatives as of December 31, 2020 are expected to be US$84.7 million within one year.

5. Research and Development

The Group devotes significant resources to new product design, development and innovation as it is a core part of its strategy. The Group believes it has a strong track record of innovation, and its global scale allows it to make significant expenditures on research and development. The Group incurred research and development expenses of US$19.4 million during the year ended December 31, 2020. Each of the Group's regions has a design team that develops products specifically for that region, and who are in communication with each other on a regular basis, sharing ideas and designs. The Group's design teams are continuously developing new products, based on continual improvement and innovation.

6. Capital Structure and Shareholding

Details on the capital structure of the Company can be found in note 24 of the consolidated financial statements. Since its incorporation, the Company did not proceed to acquire any of its own shares.

7. Other Information

Dividends and Distributions to Equity Holders

Due to the inherent uncertainties about the extent and duration of the COVID-19 pandemic and its impacts on the Company, no cash distribution was paid to the Company's shareholders in 2020.

On March 13, 2019, the Company's Board of Directors recommended that a cash distribution in the amount of US$125.0 million, or approximately US$0.0873 per share, be made to the Company's shareholders from its ad hoc distributable reserve. The shareholders approved this distribution on June 6, 2019 at the Company's Annual General Meeting and the distribution was paid on July 16, 2019.

Dividend payments to non-controlling interests amounted to US$4.1 million and US$13.0 million during the years ended December 31, 2020 and December 31, 2019, respectively.

Human Resources and Remuneration

As of December 31, 2020, the Group had approximately 9,100 employees worldwide. The Group regularly reviews remuneration and benefits of its employees according to the relevant market practice, employee performance and the financial performance of the Group.

The Group is committed to helping its employees develop the knowledge, skills and abilities needed for continued success, and encourages professional development throughout each employee's career.

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8. Strategic Review and Future Prospects

During 2020, the Group continued to implement its strategic plan in the following areas:

Financial Highlights

For the year ended December 31, 2020:

• Net sales were US$1,536.7 million for the year ended December 31, 2020, compared to
  US$3,638.8 million for the year ended December 31, 2019, a decrease of 57.8% (-57.5% constant currency). The net sales decrease was due to the effects of the COVID-19 Impacts.
• Gross profit margin, as reported, decreased to 46.0% for the year ended December 31,
  2020 from 55.4% for the previous year. The decrease in the gross profit margin was primarily related to a decrease in gross profit as a result of the decrease in net sales year- on-year caused primarily by the effects of the COVID-19 Impacts, including the effects of
  (i) an increased provision for inventory reserves and (ii) fixed sourcing and manufacturing expenses on lower sales, as well as the inclusion of restructuring charges and non-cash impairment charges related to the sourcing and production of the Group's products, along with a shift in sales mix. Excluding the restructuring charges and non-cash impairment charges related to the sourcing and production of the Group's products, the gross profit margin, as adjusted for the year ended December 31, 2020 would have been 46.8%. In addition, the effects of the increased provision for inventory reserves and the impact of fixed sourcing and manufacturing expenses on lower sales negatively impacted gross profit margin by 350 basis points and 140 basis points year-on-year, respectively, caused by the COVID-19 Impacts. Had the provision for inventory reserves and fixed sourcing and manufacturing expenses remained consistent with 2019 as a percentage of net sales, gross profit margin for the year ended December 31, 2020 would have been 51.7% (see Directors' Report - Review of Financial Year 2020 - Cost of Sales and Gross Profit for further discussion).
• The Group spent US$73.3 million on marketing during the year ended December 31, 2020 compared to US$189.5 million for the year ended December 31, 2019, a decrease of US$116.3 million, or 61.3% (-61.1% constant currency) as the Group reduced advertising to help conserve cash and to offset the effects of the COVID-19 Impacts on the Group's business. As a percentage of net sales, marketing expenses decreased by 40 basis points to 4.8% for the year ended December 31, 2020 from 5.2% for the year ended December 31, 2019.
• As a result of the COVID-19 Impacts, the Group recognized the 2020 Impairment Charges during 2020 of US$920.3 million (including US$4.3 million of non-cash impairment charges in cost of sales). The non-cash 2020 Impairment Charges were comprised of (i) a US$744.8 million non-cash impairment of goodwill and tradename intangible assets, (ii) a US$140.3 million non-cash impairment of lease right-of-use assets, (iii) a US$31.0 million non-cash impairment of property, plant and equipment that was primarily attributable to the under-performance of certain retail locations, and (iv) a US$4.3 million non- cash impairment, included in cost of sales, of certain molds and machinery used for the production of certain luggage product lines. During the year ended December 31, 2019, the Group recognized the 2019 Impairment Charges of US$86.4 million (see Directors' Report - Review of Financial Year 2020 - Impairment Charges for further discussion).
• The Group has taken meaningful actions to reduce its fixed cost base in response to the
  COVID-19 Impacts on the Group's business, which is estimated to result in annualized

run-rate fixed cost savings of approximately US$200.0 million (see Directors' Report

• Review of Financial Year 2020 - Impact of COVID-19 for further discussion). In conjunction with these cost saving actions, the Group recognized the 2020 Restructuring Charges during the year ended December 31, 2020 of US$63.0 million (including US$8.5 million of restructuring charges in cost of sales), which primarily consisted of severance associated with permanent headcount reductions, store closure costs and certain other

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costs incurred to implement profit improvement initiatives (see Directors' Report - Review of Financial Year 2020 - Restructuring Charges for further discussion). During the year ended December 31, 2019, the Group recorded costs related to profit improvement initiatives included in Other Income (Expenses) totaling US$16.0 million.

• The Group incurred an operating loss of US$1,266.2 million for the year ended December
  31, 2020, compared to an operating profit of US$283.0 million for the previous year. The Group incurred an operating loss of US$282.9 million when excluding the non-cash 2020 Impairment Charges and 2020 Restructuring Charges, compared to an operating profit of US$385.4 million for the previous year when excluding the non-cash 2019 Impairment Charges and costs related to profit improvement initiatives. The year-on-year decrease in operating profit was primarily due to the decrease in net sales and other negative impacts caused by the COVID-19 Impacts.
• The Group recorded an income tax benefit of US$94.4 million for the year ended
  December 31, 2020 compared to an income tax expense of US$31.5 million for the year ended December 31, 2019. The income tax benefit recorded during 2020 was due mainly to the US$1,382.4 million reported loss before income tax caused by the COVID-19 Impacts, changes in reserves and changes in unrecognized deferred tax assets. Included within the US$31.5 million of income tax expense recorded during the year ended December 31, 2019 were the 2019 Net Tax Benefits (as defined below) comprised of (i) a non-cash income tax benefit of US$54.6 million from a change in the tax rate applied to intangible assets currently held in Luxembourg, which primarily consist of certain tradenames owned by the Group, (ii) tax expenses of US$29.0 million associated with a legal entity reorganization and (iii) a base erosion tax arising as a result of the 2017 U.S. tax reform that applied to the Group in 2019 (which did not apply to the Group previously) of US$7.4 million. Together, these items resulted in a net tax benefit to the Group of US$18.3 million (the "2019 Net Tax Benefits").
• The Group incurred a loss for the year ended December 31, 2020 of US$1,288.0 million, compared to a profit for the year ended December 31, 2019 of US$153.4 million. The Group incurred a loss for the year ended December 31, 2020 of US$424.1 million when excluding the non-cash 2020 Impairment Charges and the 2020 Restructuring Charges, both of which are net of the related tax impact, compared to a profit for the year ended December 31, 2019 of US$211.0 million when excluding the non-cash 2019 Impairment Charges and the costs related to profit improvement initiatives, both of which are net of the related tax impact, and 2019 Net Tax Benefits. The year-on-year decrease in profit (loss) for the year was primarily due to the COVID-19 Impacts.
• The Group incurred a loss attributable to the equity holders of US$1,277.7 million for the year ended December 31, 2020, compared to profit attributable to the equity holders of US$132.5 million for the previous year. The Group incurred a loss attributable to the equity holders of US$413.8 million when excluding the non-cash 2020 Impairment Charges and the 2020 Restructuring Charges, both of which are net of the related tax impact, for the year ended December 31, 2020, compared to a profit attributable to the equity holders of US$190.1 million when excluding the non-cash 2019 Impairment Charges and the costs related to profit improvement initiatives, both of which are net of the related tax impact, and 2019 Net Tax Benefits for the year ended December 31, 2019. The year-on-year decrease in profit (loss) attributable to the equity holders was primarily due to the COVID-19 Impacts.
• The Group used US$114.2 million of cash in operating activities during the year ended
  December 31, 2020 compared to US$576.2 million of cash generated from operating activities for the previous year. As of December 31, 2020, the Group had cash and cash equivalents of US$1,495.0 million and outstanding financial debt of US$3,230.5 million (excluding deferred financing costs of US$39.9 million), putting the Group in a net debt position of US$1,735.5 million compared to a net debt position of US$1,305.3 million as of December 31, 2019. As a result of the Group taking meaningful actions to reduce

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its fixed cost base, reduce marketing expenditures, improve working capital and put a virtual freeze on capital expenditures in response to the COVID-19 Impacts, total cash burn has significantly improved on a quarterly basis during 2020. Total cash burn was (US$166.7) million during the second quarter of 2020, (US$67.7) million during the third quarter of 2020 and (US$3.6) million during the fourth quarter of 2020. Total liquidity as of December 31, 2020 was US$1,518.3 million.

• On March 16, 2020, the Company and certain of its direct and indirect wholly-owned subsidiaries entered into an amendment to the Group's credit agreement with certain lenders and financial institutions (the "Second Amended Credit Agreement"). The Second Amended Credit Agreement provided for (1) an amended US$800.0 million senior secured term loan A facility and (2) an amended US$850.0 million revolving credit facility. The Second Amended Credit Agreement extended the maturity for the senior secured term loan A facility and the revolving credit facility by approximately two years, reduced the interest rate margin for such facilities by 12.5 basis points (subject to the terms of the Third Amended Credit Agreement as described below), reset the principal amortization schedule for the term loan A facility and provided additional liquidity through a US$200.0 million increase in the revolving credit facility. The Second Amended Credit Agreement did not affect the terms of the Group's US$665.0 million term loan B facility (see Directors' Report - Review of Financial Year 2020 - Indebtedness - Second Amended Credit Agreement for further discussion).
• On March 20, 2020, the Company borrowed US$810.3 million (USD equivalent at the applicable exchange rate on the borrowing date) under its amended revolving credit facility (see Directors' Report - Review of Financial Year 2020 - Indebtedness - Second Amended Credit Agreement for further discussion) to ensure access to the Group's liquidity, given the uncertainties and challenges caused by the COVID-19 pandemic.
• On April 29, 2020, the Group and its lenders entered into a further amendment (the
  "Third Amended Credit Agreement") to the Second Amended Credit Agreement in order to suspend the requirement for the Group to test the Financial Covenants (as defined thereunder) from the beginning of the second quarter of 2020 through the end of the second quarter of 2021 (see Directors' Report - Review of Financial Year 2020 - Indebtedness - Third Amended Credit Agreement for further discussion).
• On May 7, 2020, the Group and its lenders entered into a further amendment (the "Fourth
  Amended Credit Agreement") to the Third Amended Credit Agreement to provide for an additional term loan B facility (the "2020 Incremental Term Loan B Facility") having an aggregate principal amount of US$600.0 million. The proceeds from the 2020 Incremental Term Loan B Facility, which were borrowed on May 7, 2020, were used to (i) provide the Group with additional cash resources (to be used for general corporate purposes and working capital needs) and (ii) pay fees and expenses incurred in connection with the 2020 Incremental Term Loan B Facility (see Directors' Report - Review of Financial Year 2020 - Indebtedness - Fourth Amended Credit Agreement for further discussion). These amendments and the borrowings thereunder further strengthened the Company's financial flexibility in order to navigate the challenges from COVID-19.

The Company has presented certain non-IFRS measures in the financial highlights above because each of these measures provides additional information that management believes is useful in gaining a more complete understanding of the Group's operational performance and of the trends impacting its business to securities analysts, investors and other interested parties. These non-IFRS financial measures, as calculated herein, may not be comparable to similarly named measures used by other companies, and should not be considered comparable to IFRS measures. Non-IFRS measures have limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, an analysis of the Group's financial results as reported under IFRS.

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Investment in Advertising and Promotion

The Group aggressively reduced advertising expenditures during 2020 to help offset the negative impacts on its profitability caused by the COVID-19 pandemic. Marketing expenses amounted to US$73.3 million, or approximately 4.8% of net sales, during 2020 compared to US$189.5 million, or 5.2%, of net sales during 2019.

Introduction of New and Innovative Products to the Market

The Group continued to focus on innovation and ensuring that its products reflect local consumer tastes in each region. Innovation and a regional focus on product development are key drivers of sales growth and are the means to deliver quality and value to the Group's customers.

Future Prospects

The Group's medium to long-term growth strategy will continue as planned, with a focus on the following:

• Ensure the Company's well-diversified family of brands attracts consumers at all price points in both the travel and non-travel luggage, bag and accessories categories.
• Increase the proportion of net sales from the Company's direct-to-consumere-commerce channel.
• Focused investment in marketing to support the Company's brands and initiatives.
• Continue to leverage the Company's regional management structure, sourcing and distribution expertise and marketing engine to extend its brands into new markets and penetrate deeper into existing channels.
• Continue to invest in research and development to develop lighter and stronger new materials, advanced manufacturing processes, exciting new designs, as well as innovative functionalities that deliver real benefits to consumers.
• Continue to incorporate the Company's environmental, social and governance ("ESG") philosophy into its core business practices through "Our Responsible Journey" to lead the industry in sustainability and treat all stakeholders with fairness and respect in line with the Company's long-standing motto, "Do unto others as you would have them do unto you."

The Company aims to increase shareholder value through sustainable revenue and earnings growth and free cash flow generation.

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Near-term Focus:

• Ensuring the safety and well-being of the Group's employees, customers and partners continues to be a top priority of the Company.
• The Group has taken significant actions to preserve cash and reduce its fixed cost base and will strive to maintain this lower cost structure as the impacts of COVID-19 recede and the Group's sales recover.
• A recovery plan is in place to ensure re-opening is done in the most cost-effective, safe and efficient way to ensure the Company emerges strongly with an improving profit margin profile while growing its market share when the world starts to travel again.
• Recognizing that many of the Group's restructuring actions have impacted its employees, it is important to keep the Group's teams energized and empowered to navigate through the travel disruption and emerge as a stronger organization.
• With its global platform, diverse set of product categories and leading and complementary brands offering products tailored to each region's preferences, the Company is well- positioned to benefit when day-to-day activities slowly return to normal, and global travel disruptions end.
• The Group will continue its commitment to sustainability and innovation, which are key long-term strategies for the Company.
• With significant liquidity of approximately US$1.5 billion at December 31, 2020 and meaningful reduction in cash burn, the Company is confident that it has sufficient capacity to navigate the challenges from the COVID-19 pandemic.

By: Kyle F. Gendreau

Capacity: Director

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To the Shareholders of Samsonite International S.A. 13-15, avenue de la Liberté L-1931 Luxembourg

REPORT OF THE REVISEUR D'ENTREPRISES AGREE

Report on the audit of the consolidated financial statements

Opinion

We have audited the consolidated financial statements of Samsonite International S.A. and its subsidiaries (the "Group"), which comprise the consolidated statement of financial position as at 31 December 2020, and the consolidated statement of income (loss), the consolidated statement of comprehensive income (loss), the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2020 and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs).

Basis for opinion

We conducted our audit in accordance with the Law of 23 July 2016 on the audit profession ("Law of 23 July 2016") and with International Standards on Auditing ("ISAs") as adopted for Luxembourg by the "Commission de Surveillance du Secteur Financier" ("CSSF"). Our responsibilities under the Law of 23 July 2016 and ISAs as adopted for Luxembourg by the CSSF are further described in the « Responsibilities of the réviseur d'entreprises agréé for the audit of the consolidated financial statements » section of our report. We are also independent of the Group in accordance with the International Code of Ethics for Professional Accountants, including International Independence Standards, issued by the International Ethics Standards Board for Accountants ("IESBA Code") as adopted for Luxembourg by the CSSF together with the ethical requirements that are relevant to our audit of the consolidated financial statements, and have fulfilled our other ethical responsibilities under those ethical requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of the audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

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Consolidated Statements of Income (Loss)

The accompanying notes form part of the consolidated financial statements.

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Consolidated Statements of Comprehensive Income (Loss)

The accompanying notes form part of the consolidated financial statements.

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Consolidated Statements of Financial Position

The accompanying notes form part of the consolidated financial statements.

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Consolidated Statements of Changes in Equity