Corporate Governance .................................................................................................................................. 118

Special Voting Mechanism ........................................................................................................................... 118

Major Shareholders ...................................................................................................................................... 118

Corporate Governance Report ..................................................................................................................... 119

Report of the Non-Executive Directors ......................................................................................................... 132

Statement and Responsibilities in respect to the annual report ................................................................... 135

Remuneration report ..................................................................................................................................... 137

Campari Group-Consolidated financial statements at 31 December 2020 .................................................. 150

Davide Campari-Milano N.V.-Company only financial statements at 31 December 2020 .......................... 238

Other information .............................................................................................................................................. 298

Independent auditor's report ........................................................................................................................ 298

Disclaimer

This document was not made available to the public with a signed version, which is retained at the Group corporate office.

Index 3

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About this report

Note on presentation

The annual report at 31 December 2020 was prepared in in accordance with the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB), as adopted by the European Union and with Part 9 of Book 2 of the

Dutch Civil Code. The designation IFRS also includes International Accounting Standards ('IAS') as well as all the interpretations of the International Financial Reporting Interpretations Committee ('IFRIC'), formerly the Standard Interpretations Committee ('SIC').

Adaptation plan pursuant to Articles 15 and 18 of the Market Regulations

In accordance with Articles 15 and 18 of Consob Regulation 20249 of 28 December 2017 and subsequent amendments concerning 'conditions for listing shares of companies that control companies established and governed by laws of non-EU countries', the Parent Company Davide Campari Milano N.V. (the 'Company' or 'Parent Company' or 'Campari' and together with its subsidiaries the 'Campari Group' or the 'Group') has identified its significant subsidiaries as defined Article 15(2) of the above-mentioned Regulation, and verified that the conditions set out in paragraphs b) and c) of Article 15 have been met.

Forward-looking statements

Campari Group's management report contains forward-looking statements that reflect management's current view of future development of the Group. In some cases, words such as 'may', 'will', 'expect', 'could', 'should', 'intend', 'estimate', 'anticipate', 'believe', 'outlook', 'continue', 'remain', 'on track', 'design', 'target', 'objective', 'goal', 'plan' and similar expressions are used to identify forward-looking statements that contain risks and uncertainties which are beyond the control of the Group and which call for significant judgment. Should the underlying assumptions turn out to be incorrect or if the risks or opportunities described materialize, the actual results and developments may materially deviate (negatively or positively) from those expressed by such statements. The outlook is based on estimates that Campari Group has made on the basis of all the information available at the time of completion of this annual report.

Factors that could cause the actual results and developments to differ from those expressed or implied by the forward-looking statements are included in the section 'Risk management and Internal Control System' of this annual report. These factors may not be exhaustive and should be read in conjunction with the other cautionary statements included in this annual report. Forward-looking statements made in this report shall be evaluated in the context of these risks and uncertainties.

Campari Group does not assume any obligations or liability in respect of any inaccuracies in the forward-looking statements made in this annual report or for any use by any third party of such forward-looking statements. Campari Group does not assume any obligation to update any forward-looking statements made in this annual report beyond statutory disclosure requirements.

Information on the figures presented

All references in this annual report to 'Euro' and '€' refer to the currency introduced at the start of the third stage of European Economic and Monetary Union pursuant to the Treaty on the Functioning of the European Union.

For ease of reference, all the figures in this annual report are expressed in millions of Euro to one decimal place, whereas the original data is recorded and consolidated by the Group in Euro. Similarly, all percentages relating to changes between two periods or to percentages of net sales or other indicators are always calculated using the original data in Euro. The use of values expressed in millions of Euro may therefore result in apparent discrepancies in both absolute values and data expressed as a percentage.

For information on the definition of the alternative performance measures used, see paragraph 'Alternative performance measures' in the dedicated paragraph of this annual report.

The language of this annual report is English. Certain legislative references and technical terms have been cited in their original language in order that the correct technical meaning may be ascribed to them under applicable law.

European Single Electronic Format requirements

Pursuant to article 4 of the Transparency Directive1, starting from the financial year 2020 the annual financial reports of companies listed on European stock exchange would be prepared in compliance with the European Single Electronic Format, or ESEF. The entire annual financial report, i.e. including ad minima the audited financial statements and the management report, shall be prepared in xHTML format. In addition, issuers preparing IFRS consolidated financial statements shall mark up those using Inline XBRL. To facilitate the introduction of the new rules, for annual reports for the year ending 31 December 2020, only the consolidated primary financial statements and certain administrative information meet the ESEF requirements. Campari Group manage ESEF by leveraging on a dedicated IT software implemented during the year, allowing to comply with the new regulation. However, during December 2020, the European Parliament and the Council included an amendment to the Transparency Directive allowing for a 1-year postponement of the obligation for listed companies to draw up and publish their annual financial reports in accordance with the ESEF. The ESEF postponement will be adopted as a supplementary measure to help the recovery from the Covid-19 pandemic. Following the Dutch Ministry of Finance informing in January 2021 the House of Representatives that the issuers are given an additional year to make their annual financial reports generally available in accordance with the ESEF, Campari Group will comply with it making available according to ESEF requirements, the annual reports ending from 31 December 2021 onwards.

1 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC.

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Key Highlights

for the years ending 31 December 2020

€ million

Net sales(1)

Contribution margin

EBITDA

EBITDA adjusted

EBIT

EBIT adjusted

Profit before tax and non-controlling interests Net profit-Group and non-controlling interests Group net profit

Group net profit adjusted

209.6 186.9 187.9 202.1

1,772.0

716.1

309.8 399.9

231.8 321.9

2019(2)

€ million

1,842.5 -3.8% -4.1%

801.3 -10.6% -11.0% 458.1 -32.4% 479.8 -16.7% -16.3%

386.3 -40.0% 408.0 -21.1% -20.4%

354.6 -40.9% 308.4 -39.4% 308.4 -39.1% 267.4 -24.4%

ROS % (EBIT/net sales)

ROS (EBIT adjusted/net sales)

ROI % (Operating income/fixed assets)

ROI % (Operating income adjusted/fixed assets)

13.1% 18.2% 7.9% 10.9%

21.0% 22.1% 12.6% 13.3%

Basic earnings per share (€)

Diluted earnings per share (€)

Basic earnings per share (€) adjusted Diluted earnings per share (€) adjusted

Average number of employees

(Acquisition) sale of companies or business division

Free cash flow

Free cash flow adjusted Net financial debt

Shareholders' equity-Group and non-controlling interests

Invested capital

0.17 0.16 0.18 0.17 3,784

(120.6)

168.6 261.7

1,103.8

1,998.4 3,102.2

(1) Sales after deduction of excise duties.

0.27 0.26 0.23 0.23 3,701 110.8

258.5 267.3 777.4

2,388.5 3,165.9

changetotal %

organic change %

(2) The statement of financial position figures shown at 31 December 2019 have been adjusted as a result of the provisional allocation of business acquisition values. For additional information see note 3 xi-'Reclassification of comparative figures at 31 December 2019' of Campari Group consolidated financial statements at 31 December 2020.

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Corporate bodies

Board of Directors(1)

Luca Garavoglia(2)	Chairman
Robert Kunze-Concewitz(3)	Chief Executive Officer
Paolo Marchesini(3)	Chief Financial Officer
Fabio Di Fede(3)	Group General Counsel and Business Development Officer
Eugenio Barcellona(2)	Director and Member of the Control and Risks Committee and the Remuneration and Appointment Committee
Fabio Facchini(2)(4)	Director and Member of the Control and Risks Committee
Alessandra Garavoglia(2)	Director
Michel Klersy(2)	Director
Catherine Gérardin-Vautrin(2)	Director and Member of the Control and Risks Committee and the Remuneration and Appointment Committee
Annalisa Elia Loustau(2)	Director and Member of the Control and Risks Committee and the Remuneration and Appointment Committee
External auditor (5)

Ernst&Young Accountants LLP

(1) The Board of Directors of Davide Campari-Milano N.V. (the 'Company' or 'Davide Campari' or 'Campari') was appointed by the Company's Shareholders'
meeting of 16 April 2019 for a three-year term 2019-2021.
(2) Non-executive directors.
(3) Executive Managing Director.
(4) Appointed as non-executive director by the Company's Extraordinary General meeting on 18 September 2020. On that same date, Fabio Facchini was also appointed as a member of the Control and Risks Committee by the Company's Board of Directors.
(5) The Company's Shareholders' meeting held on 27 March 2020 resolved that, as from the effective date of the Redomiciliation to Amsterdam, the Netherlands,
Ernst&Young Accountants LLP succeed without any interruption to EY S.p.A. appointed as external auditor by the Company's Shareholders' meeting of 16 April 2019.

p-Annual report at 31 December 2020

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- Relazione finanziaria annuale al 31 dicembre 2019

Management report for the year ending 31 December 2020

Updates on the coronavirus, Covid-19 outbreak

The year ended 31 December 2020 was one of the most challenging years ever for humanity and the world economy. The significant impact that the unexpected Covid-19 ('Coronavirus') pandemic had on the lives of all people around the world ranks it among the most difficult events in history. Furthermore, its consequences on lifestyles are likely to persist for quite some time, even after its complete defeat. The Campari Group's full year

performance has ultimately been impacted by this very challenging and volatile context, whilst the agility and resilience of its brands and business model have safeguarded its results and ability to deliver on its commitments and continue its long-term growth.

The year was characterized by high quarterly volatility in connection with the measures taken to combat the

Coronavirus. After the World Health Organization's declaration of Covid-19 as a pandemic, the restrictions imposed around the world to contain the virus spread ('first wave') resulted in a rapid deterioration of the socio-

economic and financial situation globally, with a subsequent negative impact on all the markets in which the Group operates, especially in the first and second quarter of the year. During the third quarter 2020, with the progressive lifting of restrictive measures after the lockdown, the Group's business performance benefitted from a recovery in

the aperitifs business in its peak summer season for core on-premise markets and from the consumption occasions generated by people spending holidays in their home country rather than abroad ('staycation'), whilst home spirits consumption continued in off-premise skewed regions. After a brief temporary relief over the summer, the impact of the so called 'second wave', which brought with it new, even if generally a little less stringent,

restrictions on people's lives and habits across all markets, led to an overall decline in the fourth quarter, focused particularly the on-premise skewed markets.

Although lockdown restrictions are temporary in nature and were gradually being eased across many countries as a result of a gradual improvement in the health crisis, restrictive measures may nonetheless continue over an extended period of time and intensify, depending on how the pandemic develops, including any new waves of the Covid-19 outbreak, and the progression of vaccine administration and its effectiveness. Uncertainty remains as regards the time needed for a full recovery and the economic and social consequences of the crisis despite the support from local government, supranational bodies and EU.

Measures to restrict social contacts have had, and continue to have, detrimental impact on global trade in general.

More specifically, with respect to the spirits business, they have had a significant adverse effect on consumption levels, given the sector's natural exposure to consumption in the on-premise distribution channel, mainly represented by bars and restaurants. Over the past months, many on-premise outlets have failed to re-open, and although a considerable number of outlets have expanded their outdoor spaces to give customers a greater sense of security, many people are still cautious and are avoiding public places. Social distancing is also reducing the number of clients that can be served. With restrictive measures remaining in place, each of these factors is likely to continue to impact consumption trends and affect the Group's ability to continue to implement brand building

strategies targeting the on-premise channel. Furthermore, the significant reduction in travel resulting from travel restrictions is having an adverse effect on the Group's global retail travel sales.

Nevertheless, in this volatile context, Campari Group plants and distilleries continue to be fully operational, while complying with rigorous health and safety protocols. Whilst advocating smart-working as the recommended policy for office-based employees, Campari Group has put in place stringent measures to ensure a safe return to the workplace, wherever feasible, confirming a strong commitment to and responsible behaviour in complying with the latest regulations and protocols. However, in many parts of the world, new restrictive measures are under consideration, thus making a return to normality highly challenging.

With regard to consumption patterns, based on analyses of sell-out statistics and consumer data, new trends in consumer habits have been detected during the Covid-19 outbreak, which the Group has started to actively leverage. In particular, in new scenarios of forced physical distancing, the human desire to socialise remains strong, with new occasions for consumption developing as consumers attempt to make bar-quality drinks at home.

This shift from the on-trade to off-trade channel that is taking place on an unprecedented scale, is impacting the performance of the spirit industry, including Campari Group businesses. Home-made cocktail making could be viewed as a new source of entertainment and remote social gatherings, driving increased consumption opportunities in the off-premise channel.

As at-home consumption benefits from social distancing measures affecting out-of-home drinking habits, more and more consumers have shown an inclination to purchase beverages online, which has resulted in a significant increase in e-commerce sales. The strategic relevance of digital transformation and the importance for Campari of reinforcing this channel led the acquisition of a 49% interest in Tannico (the leading online wines and premium

spirits platform in Italy), which is an essential part of the digital transformation journey being undertaken across the entire organisation.

Campari Group is continuing to monitor and evaluate the evolution of the pandemic and its effects on the macroeconomic scenario, on the markets in which it operates, on the behavioural patterns of its consumer base and on the Group's financial position and the results of its operations, despite the objective difficulty in making predictions in a context constrained by numerous and new variables that are beyond the Group's control. Within this radically changed global context, Campari Group is continuing to confirm its long-term vision. Within a very difficult context, the Group managed to relocate its legal seat to the Netherlands, add a significant in market company in France, start up a joint venture in Japan, change the route to market in South Africa and restructure the sugar operations in Jamaica. The Group has also shown its solidarity with the communities during this dramatic year by making significant financial and material contributions to worthy causes. Lastly, after the successful completion of the acquisitions of Champagne Lallier, the Group's distribution company in France and the afore mentioned interest in Tannico, on 6 October 2020, Campari Group successfully placed a €550 million bond on the Euro market, reflecting its excellent business and financial profile as well as its strong reputation in the capital markets. In a period characterised by global macroeconomic volatility, the transaction was highly successful and attracted a geographically well-diversified base of European high-quality investors. It was also a concrete evidence of the Group's commitment to engaging in major projects, mastering new challenges whilst confirming its long-term objectives in terms of business growth and development.

Despite the challenging environment, the Group continues its unrelenting work, building on its brands for the years to come: September 2020 culminated with a celebration of Campari's 160 years of history since its foundation.

This was marked by the unveiling in Sesto San Giovanni (Milan), the Group's headquarters, of a unique work of art, Infinito Campari, a sculpture produced by Oliviero Rainaldi that represents the soul of Campari, exalting its ambition to endure over time, as only art can do.

Main brand-building activities

The brand portfolio represents a strategic asset for the Campari Group. One of the main pillars of the Group's

mission is to build and develop its brands. The Group has an ongoing commitment to investment in marketing designed to strengthen the recognition and reputation of iconic and distinctive brands in the key markets, as well as launching and developing them in new high-potential geographical regions. The Group is developing its strategies with an increasing focus on new communications tools, especially the digital media channel, which is seen as strategic thanks to its interactive, customisable and measurable properties.

The main marketing initiatives focused on global and regional priority brands, undertaken in full year 2020, are set out below. Since the outbreak of the Covid-19 pandemic the brand-building investments, particularly brand-activation initiatives aimed at consumers and commercial partners in the on-premise and Global Travel Retail channels, have been reshaped and mainly refocused on digital activations. With the gradual reopening of the on-premise channel and relaxing of emergency containment, initiatives previously suspended during lockdown were resumed on a selected basis and were managed in a very flexible manner in light of the changing initiatives aimed at the continuous containment of the pandemic.

As a result of the restrictive measures gradually introduced to fight the pandemic, the Group's visitor centres around the world were temporarily closed. Some of them gradually reopened in June 2020, although with reduced opening hours, limited tours and experiences and rigorous compliance with the emergency health measures in force to protect the health of both Camparistas and guests.

Global priority brands

Aperol

Overall, throughout 2020 in the context of the Covid-19 outbreak, several successful charity initiatives were promoted by Aperol under 'Together we Can', involving donations to good causes in Italy while maintaining an

active involvement of the audience and strengthening the concept of Togetherness. Moreover, Aperol digital experiences were implemented across markets to entertain people with the positive and light-hearted mood of Aperol Spritz.

The initiatives aimed at reinforcing home consumption of Aperol Spritz by educating consumer on the perfect serve and by strengthening the link with food, included the Together We Can Cook activity in November 2020, launched in Italy and supported by renowned Italian chefs and prompting users to test their creative cooking skills and show they can make a perfect aperitif with Aperol Spritz. The strategy, aimed at spreading the Aperol Spritz as a 365 days a year relevance cocktail as well as increasing the moments of consumption during the day, was developed in the United States, where, in October, the #AperolLovesPizza campaign was launched through public relations partnerships. The same kinds of initiative were launch in parallel in various geographies: in Germany in November 2020, with the activity Indulgence @Home Activation aimed at connecting Aperol with Italian food and supported by exclusive media partners, to inspire readers by indulging storytelling; in Argentina in November 2020 with the #brunchearspritz campaign, launched to position the cocktail as the ideal aperitif for pairing with any brunch; in France in December 2020, through traditional media, such as out-of-home placements and radio, to associate indisputably Aperol to the spritz, to communicate about the recipe and drive brand awareness and to bring it to mind. In September 2020, out-of-home placements were secured in the United States, specifically in New York and Los Angeles; muralists were hired to paint Aperol postcards incorporating scenes from notable Italian locations and aimed at promoting the brand heritage and provenance while connecting with consumers who were missing their vacations.

In August 2020, the Aperol Spritz O Meter campaign was launched in the United Kingdom to celebrate the national Prosecco Day. The campaign aimed at engaging and educating the British on the perfect Aperol Spritz to serve using a simple key visual, showing the wrong ways in which an Aperol Spritz is commonly made.

In July 2020, an edutainment content was launched in Italy to teach the consumers about Aperol Spritz perfect serve, leveraging on the rotation filming technique. The users, connecting to #AperolSpritzChallenge, were invited to replicate the recipe at home while having fun trying to master the rotation twist.

In June 2020, the Aperol digital campaign The sound of togetherness was launched in 20 countries. The campaign features a series of scenes of consumers at home, showing their moments of 'conviviality' during the

lockdown period while enhancing the positive mood that people have in common.

In the United States, in May 2020, Aperol launched the digital campaign Elevate summer moments with Aperol Spritz at home on social media and partnered with Spotify to drive awareness and consideration by focusing on Aperol Spritz as the perfect summer cocktail for at home consumption. At the same time Aperol kicked off a social media initiative #TogetherWeToast, encouraging consumers to spread positivity by posting a virtual toast to a friend and in turn support US hospitality workers. From the end of first quarter 2020, in the United Kingdom, Australia, Spain and Germany, Aperol virtual toast events were carried out to enhance virtual connection and promoting at home consumption, in some cases with the collaboration of chefs, influencers, DJ sets and concerts.

In January 2020, for the fourth year in a row, Aperol was the official aperitif of the Australian Tennis Open, renewing its official partnership. Pop-up bars and gardens were specially designed for the two main brand experiences, Club Aperol and Casa Aperol.

In February 2020, Aperol was the official sponsor of the Venice Carnival, one of the most famous public celebrations in Italy. The sponsorship, giving great resonance to the brand in Venice after the centenary celebration, included the Carnival's opening dinner at the Casino and nine days of activities brought to life mainly in St. Mark's Square, which was completely coloured in orange with two bars and a large Aperol-branded stage.

Each year a young Venetian woman is chosen as 'angel' of the year and floats down on a cable from the bell tower into the square. This year, she was dressed in a long orange gown inspired by the colour of Aperol.

Campari

In October 2020, an inspirational new digital campaign was launched globally, bringing to life the brand's newly evolved ethos of Red Passion. The campaign features hero video content and impactful visuals through a group of protagonists like Monica Berg, as acknowledged as being the most influential person in the spirits industry in 2020, together with Bendik Giske, artist and saxophonist, Margot Bowman, an avant-garde and energetic director, and MJ Harper, artist and choreographer.

During 2020, Campari confirmed and further strengthened its longstanding legacy with the brilliant world of Cinema, embodying creativity and passion.

In Italy the #PerIlCinema initiative was launched in December 2020; this was aimed at offering tangible help to the Italian Cinema industry and professionals who, through their extraordinary talent and passion were working hard to continue to entertain despite the circumstances. In particular, a second cinema ticket curtesy of the brand will be given for the first 20,000 participants to use throughout 2021.

In September 2020, for the third consecutive year, Campari sponsored the Venice International Film Festival, celebrating the values of passion and creativity. In the Campari Lounge, the audience had the chance to become immerged in the brand essence, thanks to an experiential installation. Moreover, in this very special year, a brand new cinema experience was built through a platform on the water in the heart of the Lagoon named Campari Boat-in Cinema. In this location, a series of events were organized to shine a light on young, upcoming talents and the 'Campari Passion For Film Award' was bestowed. Lastly, a Celebrative campaign was shot during the festival and aired during the following week in order to strengthen the bond between the brand and the Venice

Film Festival.

In September 2020, for the second year in a row, Campari was the exclusive spirits partner of the New York Film Festival, the premier US showcase of the best-in-world cinema that is presented by the Film Society of Lincoln Center. The sponsorship confirmed Campari's long-standing commitment to the world of film and art and also covered the world premiere of On The Rocks film as well, directed by Sofia Coppola and starring Bill Murray and Rashida Jones.

For the 8th consecutive year, the Negroni Week was held thanks to the partnership with Imbibe magazine. During this special year, the Negroni week invited everyone to Raise a Negroni to your bar in order to raise funds to charities supporting the hospitality industry directly.

From June 2020, Campari Negroni RTE (ready-to-enjoy), the Negroni being the second most consumed and renowned classic cocktail in the world (according to Drinks 2019), was gradually launched globally with a 50 cl bottle offering.

At the end of first quarter 2020, after the outbreak of Covid-19, Campari launched a series of local digital initiatives:

- as the official partners of the 22nd Biennale of Sydney, the biggest cultural event in Australia, Campari switched from an offline to an online event, and invited visitors to live an experience from home, visiting the exhibition online and attending virtual workshops;
- in Italy and Germany, Campari organized Drink delivery experiences at home, collaborating with delivery companies. A perfect serve kit was created to educate consumers on how to make cocktails at home;

-in the United Kingdom, Campari launched the initiative Campari reopens. Some of the world-best bars, such as the Dante in New York, Drink Kong in Rome, and Three Sheets in London, were virtually reopened, allowing consumers to experience a top-end bar, creating their own cocktails in a Campari masterclass with a world-class bartender.

In February 2020, Campari sponsored the Vienna Opera Ball, one of the biggest cultural events in Austria and which also attracts significant media coverage in Europe, Japan and the United States.

Wild Turkey

In November 2020, the Wild Turkey annual global initiative With thanks kicked off in multiple markets, including the United States, Australia, the United Kingdom and Italy, to celebrate remarkable individuals in local communitieswho had given support to charities during the trying times of the pandemic, and reward them with a personalised token of appreciation.

In September 2020, the digital campaign for the super premium expression of Wild Turkey, Longbranch, was launched in the United States. It was aimed at driving awareness by leveraging the co-creator, Matthew McConaughey. The slogan Wonder What If highlights the rich storytelling that McConaughey has brought to the

Management report

brand as Creative Director, building a campaign that is blend of the culturally curious and the artistic in equal parts.

Wild Turkey Rare Breed Rye was launched in July 2020 as a blend of 4-6 and 8-year-old non-chill filtered rye, crafted in one of the few distilleries dedicated to the art of rye whiskey.

In June 2020, the 6th release in the award-winning Wild Turkey Master's Keep series, Master's Keep Bottled in

Bond, was launched globally. It is a 17-year-old Kentucky straight bourbon whiskey with the bottled-in-bond label, a certification that guarantees a strict production process and ensures incomparable flavour and consistency. Talk Turkey, the first series of advertainment on the Wild Turkey brand, starring Matthew McConaughey, got underway in 2019 and continued throughout the first quarter of 2020.

SKYY

In the fourth quarter 2020, among the product and marketing initiatives of SKYY, the SKYY Infusions Coconut was launched in Argentina, while in China the SKYY San Francisco Limited Edition was rolled out, along with the deployment of the Bold Cocktail Campaign, leveraging social and digital platforms to build emotional linkages with millennials by elevating the bold easy mix idea.

During the third quarter 2020, in the United States, SKYY Vodka launched a new themed video across all digital and social channels to the tune of the famous Victoria Monet track Do You Like It. In-stream video was added to engage consumers across online publishers, such as Rolling Stone, GQ, People and Thrillist. As at-home online activity continued to increase, SKYY e-commerce initiatives, together with search media, were pursued to keep consumers excited about at-home cocktails.

A digital and social campaign We Are The Pride was launched in the United States in June 2020 in support of the LGBTQ+ Community. The campaign featured pop star Kim Petras and RuPaul's Drag Race talents such as

Violet Chachki and Heidi N Closet.

Jamaican rums

With regard to the Jamaican rums portfolio, starting from October 2020, the new global communication campaign Crafted with Joy went live in the brands' key markets, Canada, the United States and Jamaica, as well as in other geographies. The activation was mainly at digital level, aiming at driving awareness and elevating the brand's presence as a Premium+ leader in the rum category by featuring a series of scenes exemplifying joyful

excellence and showcasing the key brand attributes of provenance, ageing, terroir, as well as the master blender, Joy Spence.

In the last quarter of 2020, the prestigious Appleton Estate Hearts Collection was made available in select, retail premium spirits outlets in global markets. It is a rare, limited-edition series of three single marque pot-still rums distilled in a Forsyth Pot Still and aged between 21-26 years. Hand selected from Appleton Estate's legendary inventory, it is the outcome of collaboration between the brand's master blender and the Italian connoisseur Luca

Gargano, one of the greatest rum collectors in the world.

Starting from February 2020, the Appleton Estate brand was relaunched in its key markets with a new packaging design which emphasized the brand's premium characteristics and the minimum aging statement.

In addition, a new range of aged rum, Kingston 62, was launched in the Jamaican market in the first quarter 2020 and in Peru and the United Kingdom in July 2020, supported by point-of-sale trade communications as well as a digital campaign aimed at communicating the new brand name, new packaging and outstanding quality of rum.

Grand Marnier

In June 2020, Grand Marnier launched a new global social media campaign aimed at enabling consumers to find their own Grand Moment in everyday life by taking good care of themselves and finding their own new normality. International bartenders hosted live sessions on Instagram with social clips by master blender Patrick Raguenaud, the brand ambassador for Grand Marnier.

In January 2020, the new Cuvée du Centenaire, which was created in 1927 to celebrate the first century of the House of Marnier Lapostolle, was rolled out worldwide with premium packaging inspired by the art nouveau movement.

Regional and local priority brands

Concerning the regional priority brands, the first global campaign of Averna Open Sicily was launched, celebrating the vibrant world of Sicily and the modern expressions of the island with a new brand visual identity, packaging and communication.

In addition, the new packaging of Bisquit&Dubouché VS and VSOP was launched in Belgium. With respect to Espolòn, the brand received the Impact Hot Brand 2019 award for the fourth year in a row, and a national digital campaign 'Choose your own adventure' focusing on the week-long celebrations of Mexican Independence Day was launched in September 2020 in the United States, aimed at increasing brand awareness, maintaining the good growth rate and ensuring that the brand continued standing apart from the competitive crowd. A strong brand activation was also undertaken in Italy to celebrate the 'Dia de los Muertos' in November 2020, bringing Espolòn's

unique game changer spirit to life through Influencer activations, media partnerships, Mexican heritage murals and street art operas in key lifestyle and urban bars and venues.

Concerning the local priority brands, Crodino was relaunched with an adult and premium offering in the European markets and a newly designed transparent 17.5cl bottle was launched that celebrates its authentic Italian heritage.

Lastly, Campari Soda launched the digital campaign 'Design Connection': a collection of three design objects

made with the iconic Campari Soda bottle and produced with the collaboration of three young and talented designers; the campaign was aimed at strengthening the brand linkage with design, given its iconic bottle, a design masterpiece, conceived in the early 30s by futurist Fortunato Depero.

Corporate activities

In September 2020, Campari Group celebrated its 160th anniversary with a sculpture that represents the values that have guided the Group since its foundation in 1860.

The 160th anniversary was celebrated in Sesto San Giovanni (Milan), where the Company's first bottling plant was built at the place where the Group's headquarters is located today. The celebration included the inauguration of

Infinito Campari, a work of art designed and created by the internationally renowned sculptor Oliviero Rainaldi; that consists of two elements: a work of landscape art, entitled 'The Telescopic Labyrinth', and a monumental

sculpture in Carrara marble that lies at its heart. The work is inspired by the history of Campari and in particular by two works created by artists who, in their time, made key contributions to building the brand: the futurist

Fortunato Depero, with his work of 1931 entitled 'The Campari Pavilion', and the painter and illustrator Leonetto Cappiello who, with 'Lo Spiritello' (1921), marked the history of the brand.

Furthermore, on the occasion of this anniversary, Campari Group presented the 160 Years of Campari stamp issued by the Italian Ministry of Economic Development and belonging to the thematic series 'Excellencies of the Italian productive and economic system'.

Significant events of the year

Corporate actions

Ordinary and Extraordinary shareholders' meeting held on 27 March 2020

The Extraordinary shareholders' meeting held on 27 March 2020 resolved to transfer the registered office of

Davide Campari-Milano S.p.A. to the Netherlands, subject to certain conditions precedent.

The Ordinary shareholders' meeting approved the 2019 annual financial statements and agreed the distribution of a dividend of €0.055 per outstanding share, an increase of +10.0% on the previous year. The total dividend, calculated on the outstanding shares and excluding own shares in the portfolio (18,451,416 shares on the date of the Company's Shareholders' meeting), amounted to €62,873,172.12 and was paid on 22 April 2020.

Transfer of the registered office to the Netherlands

On 4 July 2020, the transfer of the official seat of Davide Campari-Milano S.p.A. to the Netherlands

('Redomiciliation'), with its simultaneous conversion to a Naamloze Vennootschap (N.V.), was completed: the Dutch notarial deed for the transfer of Campari's official seat resolved by the extraordinary shareholders' meeting of 27 March 2020 was executed, with effect on the same date. The new company name is therefore 'Davide

Campari-Milano N.V.' (the 'Company' or 'Davide Campari' or 'Campari') and the new articles of association have come into effect ('Articles of Association').

As part of this transaction, the Company was required to pay to shareholders who exercised their right of withdrawal a reference unitary price per share set at €8.376 (this withdrawal price having been determined in accordance with Article 2437-ter(3) of the Italian Civil Code). The cash outflow borne by the Company for the liquidation of 7.7 million shares, net of withdrawn shares for which the option and pre-emption right was exercised by the controlling shareholder Lagfin S.C.A., Société en Commandite par Actions for an overall commitment of above €250 million, and the shares for which the withdrawal was waived, on 7 July 2020, was €64.7 million. The liquidation of the above 7.7 million shares generated a negative price difference, to be recognized within Group equity, for an amount of €3.4 million based on the difference between the withdrawal price of €8.376 and the closing price on the settlement date (7 July 2020) of €7.94 per share, or an amount of €5.2 million, based on the difference between the withdrawal price of €8.376 and the market closing price of €7.70 per share on the date of the transaction approval (22 June 2020). This result confirmed the full compliance with the Group's commitment not to exceed the maximum cost cap of €7/8 million deemed by the Company to be acceptable.

With the transfer of the sole registered office which does not entail any changes in the organization, management or operational activities and, above all, envisages that the tax residence of the Group is maintained in Italy, the key objective pursued by the Company is to enhance its increased voting mechanism in favour of long-term shareholders and, therefore, the adoption of a flexible capital structure that can further support the Group in pursuing growth opportunities also via major acquisitions.

Additional information on the Redomiciliation in compliance with applicable legislation and regulations is provided and made available on the Campari's website (www.camparigroup.com).

Extraordinary General meeting of 18 September 2020

On 18 September 2020 the Extraordinary General meeting of the Company resolved to:

a) reduce the nominal value of each ordinary share from €0.05 to €0.01 and consequently reduce the nominal value of each special voting share A from €0.05 to €0.01, the nominal value of each special voting share B from €0.20 to €0.04 and the nominal value of each special voting share C from €0.45 to €0.09. After the capital reduction the Company's share capital is still composed of 1,161,600,000 ordinary shares, which are listed, freely transferable and each of them confers the right to cast 1 vote. The special voting shares are not listed on a regulated market, are not transferable and do not confer any economic right. Each of the special voting shares A, B and C confers the right to cast respectively 1, 4 and 9 votes.
b) Implement provisions of the articles of association on the conversion of the shares into Special Ordinary Shares.
In order to implement Article 13.11 of the Company's articles of association, the Extraordinary General meeting of the Company approved the authorization to provide holders of special voting shares C of a right to exchange one special voting share C, together with the corresponding qualifying ordinary share, for one special ordinary share giving right to 20 votes (the Special Ordinary Share). This right of conversion is aimed at further strengthening the Group's stability and fostering the development and the continuous involvement of a stable base of long-term shareholders. (for more details please refer to 'Governance' section of this 2020 annual report).
c) Appoint Fabio Facchini as non-executive director for the period ending at the closure of the Annual General meeting of shareholders to be held in 2022. Fabio Facchini, whose nomination is binding pursuant to article 15.2
of the Company's articles of association, is considered independent within the meaning of the Dutch Corporate
Governance Code. On that same date, Fabio Facchini was also appointed as a member of the Control and
Risks Committee by the Company's Board of Directors. The Board of Directors believes that his audit experience

and general management expertise will provide a valuable contribution to the Board of Directors.

d) Approve the remuneration policy, as updated and amended in accordance with the new Dutch legal framework.

The remuneration policy provides for the parameters for remuneration of the executive directors and the non-executive directors, taking into account the relevant legal requirements and the principles of the Dutch Corporate Governance Code that follow from the applicable Dutch and European legislation. The remuneration policy is made available on Campari's website(https://www.camparigroup.com/en/page/group/governance).

Capital Reduction on 27 November 2020

On 27 November 2020, Davide Campari-Milano N.V. announces that the capital reduction (Capital Reduction) via a decrease of the nominal value of each ordinary share from €0.05 to €0.01 (and the consequent reduction of the nominal value of Campari's special voting shares), approved by the extraordinary general meeting held on September 18th, 2020, has become effective by way of a notarial deed amending Campari's articles of association

executed on 27 November after the issuance by the Court of Amsterdam of a declaration stating that no creditors have objected to the Capital Reduction, pursuant to article 2:100(3) of the Dutch Civil Code. As a result of the

Capital Reduction, Campari's ordinary share capital is now equal to €11,616,000.00. The Capital Reduction has

no effect on the number of ordinary shares composing the share capital that will remain unchanged and be equal to 1,161,600,000 ordinary shares, each having a nominal value of €0.01. The total amount of the decrease of the ordinary share capital (equal to €46,464,000.00) has been allocated to Campari's non-distributable reserves. As

pointed out in the relevant documentation, the Capital Reduction is aimed at minimizing the impact of the issuance of special voting shares on the Company's reserves and the Company's articles of association permit the issue

of such shares without requiring the shareholders so entitled to pay for the nominal value of the special voting shares but rather through the use of the Company's available reserves. For further information on the Capital Reduction, please refer to the documentation available on Campari's website (www.camparigroup.com).

Group significant events

Financial debt management

On 6 October 2020, the Company successfully issued an unrated 7-year Eurobond for a principal of €550 million due in 2027; it was targeted at institutional investors and pays a fixed annual coupon of 1.25%. The issue price was 99.76% and the spread over the midswap is 165 basis points.

On 15 December 2020, the bond was admitted to trading on the ExtraMOT PRO, the professional segment of the

Italian Stock Exchange's ExtraMOT MTF market, the reference market for the listing of debt instruments already

admitted to trading on a European Union regulated market. The Notes, the first issued by Campari Group to be listed on this segment, are targeted at institutional investors. The listing on the ExtraMOT PRO is a secondary listing for the Notes. The Notes continue also to be listed on the Official List and admitted to trading on regulated market of the Luxembourg Stock Exchange. With this dual listing Campari Group intends to further enhance the diversification of its bondholder base by leveraging the international reach of the ExtraMOT PRO market.

Since its inaugural issue in 2009, Campari Group has cumulatively raised €2.3 billion in funds in the unrated

Eurobond market, including this issue, confirming its positive and long-lasting relationship with the debt-capital markets. The proceeds of the issue of the notes will be used by the Campari Group for general corporate purposes and in line with the Group's strategy, including but not limited to the refinancing of the Group's existing

indebtedness.

On 14 April 2020, the Company entered into a term debt facility agreement for an amount of up to €750 million ('the Facility') with a pool of leading international banks. The Facility consists of a short-term bridge loan with an

interest rate of 3-month Euribor plus a 0.65% spread, on top of utilization fees, with an initial maturity date of 30

June 2021 and an option for extension to 31 December 2021. The purpose of the Facility was to support the general corporate purposes of Campari Group, including but not limited to, the redemption of the Eurobond issued by Davide Campari in 2015 and expired in September 2020, for a residual nominal amount of €581 million. Ahead of the 2015 Eurobond redemption, the Facility has been drawn for an amount of €600 million (repaid immediately after the 2020 bond issue), whilst a second tranche of €150 million is still undrawn and available to the Company.

Share buyback plan and Purchase of own shares

With regard to execution of the share buyback program, the Company's Board of Directors decided, on 18 February 2020, to continue it for an increased amount of up to €350 million over the following next twelve months.

The increase in buyback will serve the new strategy of having a portfolio of own shares to meet all the existing stock option plans, rather than just those plans that are close to being exercised. The aim is to hedge the risk of an increase in the price of the shares underlying the options and, as a result, contain the Company's overall outlay required to service the incentive plans. The Company's Shareholders' meeting, confirming the purposes

mentioned above, authorised the Board of Directors to purchase and/or sell own shares until 30 June 2021, to re-constitute the portfolio of own shares to serve the current and future stock option plans for the Group's management, while complying with the limits and procedures laid down in the applicable laws and regulations.

Between 1 January and 31 December 2020, the Company purchased 36,281,893 own shares, at an average price of €8.09, for a total amount of €293.6 million (including 7.7 million shares for an amount of €64.7 million bought back in the context of the Redomiciliation process at a withdrawal price of €8.376 per share). Considering the spot price per share at 31 December 2020 of €9,34 a theoretical gain of €45.3 million on these purchases is

implied within Group equity. During the same period the Company sold 7,792,286 own shares for an outlay of €22.4 million, following the exercise of stock options. At 31 December 2020, the Company held 42,193,807 own shares, equivalent to 3.63% of the share capital.

Acquisitions and commercial agreements

Acquisition of a 49% interest in Tannico

On 29 June 2020, Campari Group completed the acquisition of a 49% interest in Tannico e Wineplatform S.p.A.

('Tannico' or 'Tannico S.p.A.'). Founded in 2013, Tannico is the market leader in online sales of wines and

premium spirits in Italy, with a market share of over 30%. Tannico has progressively expanded into the business-to-business, offering targeted value-added services to professional operators in areas such as assortment and warehouse management, as well as tailored delivery solutions. Since 2017, Tannico has expanded its footprint to more than 20 markets, including the USA, Germany, UK, and France.

In 2019, Tannico achieved net sales of €20.6 million (under local generally accepted accounting principles, or

'GAAP'). The compound annual growth rate (CAGR) for net sales for the past three years (2016-2019) was approximately 50%, with net sales rising significantly in 2020, partly due to the Covid-19 emergency, almost reaching break-even from a profitability standpoint.

The total consideration paid for the 49% interest was €23.5 million, which was financed from available resources.

Under the investment agreement, Campari Group will have the possibility of increasing its interest to 100% from 2025, subject to certain conditions.

Tannico is a unique and strategic fit with Campari Group's long-term business development goals. By leveraging Tannico's expertise, the Group will greatly enhance its digital capabilities and accelerate its development plans in e-commerce, a channel that is already growing and is set to become of even greater strategic importance given the likely long-lasting change in consumer behaviour due to the Covid-19 emergency.

Acquisition of Champagne Lallier

On 10 June 2020, Campari Group completed the acquisition of an 80% interest, with a medium-term route to total ownership, in the share capital of Champagne Lallier S.a.r.l. and other group companies (jointly, the 'company' or

'Campagne Lallier), from the privately-owned French company Ficoma S.a.r.l., the family holding company of

Francis Tribaut. The company is the owner of the champagne brand Lallier, which was founded in 1906 in Aÿ, one of the few villages classified as 'Grand Cru' in Champagne, a clear indication of the product's quality.

In 2019, the Company's sales amounted to €21.0 million (under local GAAP), including primarily sales of champagne of approximately 1 million bottles, of which close to 700,000 bottles of Lallier.

The consideration paid was €21.3 million (excluding the net financial debt at the closing date) and was financed

from available resources. The transaction encompasses the brands, related stocks, real estate assets (including owned and operated vineyards) and production facilities.

Under the agreement, the remaining shareholding is subject to reciprocal put and call options, which can be exercised from 2023. Francis will continue in his role as managing director of Champagne Lallier.

Starting from January 2021, the highly respected industry veteran Dominique Demarville joined Champagne Lallier as General Manager and Cellar Master. The choice of Dominique reflects the ambition of Campari Group to develop Maison Lallier not only as a global Champagne player but as a superior Champagne range. With his great competence and passion for the Champagne world Dominique would lead Lallier to the next level, continuing the excellent job done by Francis.

With this acquisition, which marks the entry of the first player of Italian origin into the Champagne category, Campari Group has added to its portfolio a premium and historical champagne brand, Lallier; since it is mainly sold in selected on-trade outlets and wine shops, this brand further extends Campari's range of premium offerings in this key channel for brand building. Moreover, Campari Group will build further critical mass in the strategic French market where the Group recently started to sell through its own in-market company.

Acquisition of Baron Philippe de Rothschild France Distribution S.A.S.

On 28 February 2020, Campari Group completed the acquisition of 100% of French distributor Baron Philippe de

Rothschild France Distribution S.A.S. ('RFD'), a wholly owned subsidiary of Baron Philippe de Rothschild S.A.

specializing in the distribution of a diversified portfolio of international premium spirits, wine and champagne brands in France. RFD is the sole distributor for the French market of the Campari Group's portfolio, which is

currently the main contributor to RFD's sales and growth. With regard to the rest of the portfolio, RFD is theexclusive distributor for the French market of the seller's premium and super premium wines, including the Mouton Rothschild and Mouton Cadet brands. The total acquisition price was €50.3 million (excluding the net financial debt at the closing date). The transaction was financed using the Group's available resources.

In 2019, RFD's total sales were €149.8 million, based on local accounting principles (€100.0 million after the reclassification based on International Financial Reporting Standards principles 'IFRS').

The incorporation of the distribution structure of RFD (now called Campari France Distribution S.A.S.) into

Campari's network and the possibility of operating directly in France (a high-potential market for the Group) represents a unique opportunity to enhance the Group's focus on its key brands and benefit from the increased

critical mass of the aperitifs business and the newly-acquired Trois Rivières and La Mauny premium rhum agricole brands.

Joint venture in Japan

On 14 February 2020, the Group signed an agreement to create CT Spirits Japan Ltd., a joint venture in Japan, with a local partner experienced in the food&beverage sector. The aim of the joint venture is to promote and develop the Group's products in this market. The Group holds a 40% stake and has a call option on the remaining

holding of 60% of the share capital, which can be exercised from 2023.

Terrazza Aperol

In November 2020, Campari Group secured a space in the heart of Venice (Campo Santo Stefano), set to become the first directly managed Aperol Flagship location, later in 2021, once the project execution and marketing activities will be completed. This initiative is part of Campari Group's activities to create brand houses for its iconic brands and will enable the Group to ensure local and international Aperol brand visibility and equity in the on-premise channel, while also consolidating its expertise in managing sales outlets, following the reopening of Camparino flagship in Milan in 2019.

Other significant events impacting Group results

Malware attack

At the beginning of November 2020, Campari Group has been the victim of a targeted ransomware attack following unauthorized access to its network. The malware attack was promptly identified and Group IT took immediate action with the support of cyber-security experts, to limit its spread across data and systems and to immediately implement all possible extra security measures. At the very initial stage, all on-premise servers were switched off (determining a temporary IT outage) to isolate the IT systems, avoid malware spread or further illegitimate actions, to allow such systems' sanitization and progressive restarting in a secure way, and then rapidly

resume normal activities. The situation has been permanently monitored to assess and minimize the recovery time. The attack has caused the encryption of certain data on some of the Group's servers and after technical

investigations the Group has announced in transparent dialogue with its stakeholders, that notwithstanding security measures in place, some personal and business information has been compromised with potential consequences for employee, customer, supplier and business partner data. Campari Group offers its sincerest apologies for any complications and concerns that this may bring to its potentially impacted employees, customers, suppliers, business partners, as well as to its many stakeholders, and has offered identity theft support where customary. There is no indication that Campari Group websites have been accessed.

The investigation on the matter and all the activities aimed at the protection of the involved subjects, are ongoing, with the support of legal and cyber-security experts and in full cooperation with relevant authorities.

As defensive measures Campari Group is implementing all actions deemed appropriate, to further protect its IT estate and, therefore, personal and business data stored therein.

The Group's recurring operations did not suffer any material financial impact measured on annual basis from the temporary outage since the business continuity for Group operations, customers and partners has been preserved and rolled out by order of priority, with the objective of restoring operations in the fastest, yet most prudent fashion, to avoid any recurrence. In particular, the manufacturing and logistics activities as well as the processing of sales orders across all markets have been resumed and are regularly functioning as the Group's top priority.

The Group will keep the authorities and stakeholders informed and collaborate with them as appropriate and in accordance with applicable laws and regulations.

Restructuring programme in the Agri Business in Jamaica

In July 2020, the Group launched a restructuring programme in Jamaica for the agricultural sugar business, in the wake of financial losses accumulated over the years as a result of the global decline in the price of sugar, a reduction in demand in the local market and heightened competition, exacerbated by the Covid-19 scenario. The restructuring programme is aimed at preserving the business continuity of the core spirits business in Jamaica.

The consultation process with the local authorities and trade unions started in July 2020, with a view to achieving the best possible outcome for the local community. In view of the scale of the restructuring program, which willultimately result in the recognition of restructuring costs for the Group (to be determined based on the outcome of the consultation process) the Group is managing the initiative with the local authorities with great care and sensitivity for the local community. Following the start of consultations, on 29 July 2020, it was announced that the Group would cease operating its Appleton Estates Sugar Factory. The Group financials at 31 December 2020 include €13.5 million costs relating to the estimated corresponding restructuring costs.

Donations in response to the Covid-19 pandemic emergency

In response to the pandemic emergency, Campari Group has been proactively supporting local communities through donations of cash and alcohol for the manufacture of sanitisers for healthcare workers on the front line worldwide, while at the same time providing support for baristas and other sector operators affected by the temporary closure of their business.

Among its various initiatives, the Company donated €1 million in March 2020 to fund a general intensive care

operational unit for the Covid-19 emergency at the ASST Fatebenefratelli Sacco public health institution in Milan, a reference point for the management of patients most seriously affected by coronavirus.

In April and June 2020 respectively, the Company made a donation to the Italian Civil Protection and to FNOPI

(National Federation of Healthcare Workers) through the Aperol video initiatives 'Together we can' and 'Together we can dance'. The first initiative was organized in conjunction with Rockin'1000 and featured 1,200 musicians

from all over the world singing from their homes a choral song written by the popular Italian musician Max Gazzè.

The second initiative was supported by Luca Tommassini, a world-renowned dancer and choreographer, and over 1,000 dancers from all around the world participated in this video, creating a virtual dance choreography side by side for a good cause.

Campari Group made a donation to Fondazione MultiMedica Onlus, the foundation for Gruppo MultiMedica, one of the largest hospital groups in Lombardy (Italy). The aim was to strengthen the Intensive and Sub-intensive Care Units and to ensure personal protective equipment for healthcare operators in the field.

In the United States, Campari America donated USD1 million to Another Round, Another Rally, a non-profit organization that raises emergency funds offering relief to workers and bartenders in the hospitality industry, which has been forced to shut down its commercial operations as a result of the Covid-19 emergency. This initial donation, supported on social media by the main brands, SKYY, Wild Turkey, Appleton Estate, Campari, Aperol, Grand Marnier, Espolòn, Cabo Wabo and Bulldog, and by various influencers, including Matthew McConaughey, gave rise to the #OneMoreRound challenge, in which the public were encouraged to make donations.

The initiative was deployed in many countries: Campari Canada donated to the Bartenders Benevolent Fund; Campari UK staff and Campari UK jointly donated to The Drink Trust; Campari Deutschland donated to the non-profit organization StartNext; Campari Australia supported the venues by providing access to contactless bottled cocktail delivery and collection services, product donations and marketing toolkits.

The initiatives above mentioned were overall extended during the second wave of the pandemic starting from October 2020.

Subsequent events

Subsequent events relating to corporate actions, significant events, acquisitions and commercial agreements and other significant events impacting results are reported in a dedicated note in the Campari Group consolidated financial statements, to which reference is made.

Group Financial Review

During the year ending 31 December 2020 certain adjustments on the purchase price allocation related to the acquisitions completed in 2019 were recorded. Those changes required some of the balances stated at 31 December 2019 to be shown differently, as detailed in the note 3 xi-'Reclassification of comparative figures at 31 December 2019' of Campari Group consolidated financial statements at 31 December 2020 to which reference is made. These adjustments did not have a significant impact on the profit or loss or cash flow for the period ending 31 December 2020.

Sales performance

1. Overall performance

In 2020, the Group's net sales totalled €1,772.0 million, with an overall decrease of -3.8% as compared to 2019.

The organic growth component showed a negative change of -4.1%. The exchange rate component was negative at -2.7%, while the perimeter effect was positive at +3.0%.

total

Total

2020	2019	change
€ million	€ million	€ million	total	rateʿ¹ʾ	first	second	third	fourth
1,772.0	1,842.5	-70.4	-3.8%	-2.7%	-5.3%	-15.9%	+12.9%	-7.0%

full year change %, of which exchange organic perimeter

organic change % by quarter

-4.1%

3.0%

(1) Includes the effects associated with hyperinflation in Argentina.

Organic change

The full year performance showed an organic change of -4.1%, with a fourth quarter down -7.0% after a decline of -2.8% in the first nine months period. The overall performance was largely hit by renewed lockdowns and severe restrictive measures affecting key on-premise markets (a channel which is estimated to represent approximately 40% of the Group's overall pre-Covid-19 sales), such as Italy, as well as the Global Travel Retail channel. The off-premise skewed markets, such as the United States, Canada, Australia and Northern Europe, continued their sustained growth. In particular, notwithstanding a strong third quarter (+12.9%), very positively impacted by favourable weather conditions, summer 'staycation' effect and the gradual reopening of on-premise which benefitted the aperitif business in its peak summer season, the fourth quarter suffered heavily from the resurgence of the pandemic, which is still active and challenging in many markets. Overall, the fourth quarter was weak, mainly driven by European markets, due to the restrictions re-introduced in the on-premise channel as well as a less pronounced staycation effect as compared to the summer, given the lower seasonality for aperitifs and the lack of winter sports tourism.

Regarding the United States, the Group's largest market, the growth was driven by a positive year-end close

(+13.0% in the fourth quarter), mainly thanks to a gradual shipment re-alignment to very positive off-premise consumption patterns, as the destocking at wholesaler level across the whole portfolio was gradually completed by year-end. Excluding the destocking effect, the United States market organic growth would have been +9.1% in 2020 (as opposed to +3.4%), while the Group's overall organic growth would have been -2.5% (as opposed to -4.1%).

With regard to brand performance, the global and local priority brands declined overall by -3.8% and -4.4% respectively, mainly due to a negative performance in brands characterized by on-premise exposure (particularly the aperitifs), impacted by restrictions throughout the year across markets, amplified by renewed lockdowns at year-end, as well as trade destocking in the United States. The regional priority brands were slightly positive at +0.4%, mainly driven by the strong growth of Espolòn tequila.

Although the evolution of the pandemic remains highly uncertain in most countries, the strong brand momentum continued as confirmed by consumption data, with sell-out trends outperforming shipments across all the key off-premise brand and market combinations, mainly fuelled by home consumption. The sell-out trends were positively driven by relentless brand building activities throughout the year, mainly influenced by initiatives in digital and off-premise channels.

The e-commerce channel also grew positively during the year, accounting for approximately 2% of Group's net sales in 2020, with the United States and the United Kingdom over indexing at 3% and 10% respectively2.

2 Internal data and estimates.

for the years ending

2020 € million

2019 € million

%total change € million

full year change %, of whichtotalorganic perimeterexchange rateʿ¹ʾ

Americas

Southern Europe, Middle East and Africa

821.5 498.7

44.6% -47.6 27.1% -35.1

North, Central and Eastern Europe Asia-Pacific

Total

22.8% 7.4% 100.0%

130.8 1,772.0

393.8 128.5

21.4% 9.9 7.0% 2.3

1,842.5 100.0% -70.4

-5.8% -7.0%

2.5% 1.8% -3.8%

-1.8% -18.6%

6.8% 4.6% -4.1%

0.7% -4.7%

11.6% -0.1%change % fourth quarter organic 2.5% -30.2%

-2.2% -2.0%

- -2.9%

3.0% -2.7%

-3.0% 2.8% -7.0%

(1) Includes the effects associated with hyperinflation in Argentina.

percentage of

full year change %, of which

Group sales

total

organic

perimeterexchange rate

change % fourth quarter organic

global priority brands	55.6%	-6.0%
regional priority brands	18.0%	3.2%
local priority brands	11.0%	-7.5%
rest of the portfolio	15.3%	-0.5%
Total	100.0%	-3.8%

-3.8% 0.4% -4.4% -10.0% -4.1%

-7.1% 3.3% -14.0% -15.5% -7.0%

The main trends by geographical region and by priority brand are shown below.

❖ Geographical regions
- The Americas region recorded a decline of -1.8% (+2.5% in the fourth quarter): the resilient performance of off-premise skewed Canada (+12.5%) as well as the sustained growth in the United States (+3.4%) were unable to offset the decline in Jamaica (-8.2%), Mexico (-31.2%) and the remaining South American countries.
- The Southern Europe, Middle East and Africa region reported an organic decrease in sales of -18.6% (-30.2% in the fourth quarter), driven by the negative performance of its core on-premise skewed market, Italy (-17.4%), the Global Travel Retail channel (-68.9%), Spain (-47.7%) and South Africa. France grew overall with positive transition to an owned distribution structure.
- The Northern, Central and Eastern Europe region showed positive organic growth of +6.8% (-3.0% in the fourth quarter). Specifically, resilient growth in the region, mainly off-premise skewed, was sustained by the double-digit growth of Russia (+10.7%), the United Kingdom (+7.4%) and Germany (+8.6%).
- The Asia-Pacific region recorded a positive performance of +4.6% (+2.8% in the fourth quarter), driven by
Australia, the region's core market, which increased by +20.2%, more than offsetting the negative decline in the rest of the region, especially Japan and China, mainly due to the pandemic effects.
❖ Brands
- The Group's global priority brands registered an organic sales decrease of -3.8% (-7.1% in the fourth quarter). The overall performance of on-premise skewed brands (Aperol, Campari, Grand Marnier) was affected by on-premise restrictions, also exacerbated by the destocking in the United States, which more than offset the very positive momentum in the off-premise channel. Jamaican rums and Wild Turkey grew, whilst SKYY declined, largely due to the ongoing destocking in the core United States market ahead of a complete brand re-launch.
- The regional priority brands recorded an organic increase of +0.4% (+3.3% in the fourth quarter) largely due to the weak performance in sales of core brands, such as Cinzano, The GlenGrant, Bulldog and the bitters. On the contrary, Espolòn and Forty Creek showed solid double-digit growth.
- The local priority brands contracted by -4.4% (-14.0% in the fourth quarter) as a result of the decline in sales of Campari Soda and Crodino, impacted by its exposure to the on-premise channel in Italy, despite the positive performance of Wild Turkey ready-to-drink, as well as other brands, led by Cabo Wabo and Ouzo 12.

Perimeter variation

The perimeter variation of +3.0% in 2020, as compared with sales in the same period of 2019, is analysed in the table below.

breakdown of the perimeter effect acquisitions (Rhumantilles S.A.S., Ancho Reyes and Montelobos, Baron Philippe de Rothschild France Distribution S.A.S.(1) and Champagne Lallier)

€ million

% on 2019

64.3 3.5%

total acquisitions discontinued agency brands total discontinued agency brands

64.3 3.5%

(9.6) -0.5%

total perimeter effect

54.6

3.0%

(1) Baron Philippe de Rothschild France Distribution S.A.S. ('RFD'), now named Campari France Distribution S.A.S. ('CFD').

• Business acquisitions

In 2020, the perimeter variation due to business acquisitions was positive at +3.5%. It was driven by the acquisition of Rhumantilles S.A.S., owner of the Trois Rivières and La Mauny brands, which contributed to the Group's results from 1 October 2019, as well as by the acquisition of Ancho Reyes and Montelobos, which contributed to the

Group's results from 20 November 2019. The acquisition of CFD contributed to the Group's results from 28

February 2020 and the acquisition of Champagne Lallier from 30 June 2020. With regard to the CFD acquisition, sales of Campari Group's products contributed to the organic sales change, given that they were previously distributed by CFD, hence shown as Group sales, by virtue of the distribution agreement that had existed prior to the acquisition, whereas sales of agency brands are classified as perimeter variations.

• Brands distributed

The perimeter variation due to termination of the distribution of agency brands in 2020 amounted to -0.5% and was mainly related to contracts in Germany and Russia from 1 January 2020.

Exchange rate effects

The exchange rate effect in 2020 was negative at -2.7%, due to the devaluation of almost all the Group's currencies against the Euro, with the exception of the Swiss Franc (not material for the Group). The exchange rate effect includes the impact of applying the IFRS guidance on managing hyperinflation in Argentina to both conversion to Euro at the spot exchange rate at the end of the period of all the profit or loss items expressed in Argentine Pesos and the new method for calculating organic growth for the Argentine market.

The table below shows the average exchange rates for 2020 and the spot rates at 31 December 2020 for the

Group's most important currencies, together with the percentage change against the Euro as compared with the

same period in 2019 and at 31 December 2019.

average exchange rates

spot exchange rates

At 31 December	appreciation/(devaluation)
2019	vs. 31 December 2019
: 1 Euro	%
US Dollar	1.123	-8.5%
Canadian Dollar	1.460	-6.6%
Jamaican Dollars	148.887	-14.8%
Mexican peso	21.220	-13.1%
Brazilian Real	4.516	-29.1%
Argentine Peso(1)	67.275	-34.8%
Russia Rubles	69.956	-23.5%
Great Britain Pounds	0.851	-5.4%
Switzerland Francs	1.085	0.5%
Australian Dollar	1.600	0.6%
Yuan Renminbi	7.821	-2.5%

For the year ending 2020

1 Euro

For the year appreciation/(devaluation)ending 2019 : 1 Eurovs. 2019 %

At 31 December 2020 1 Euro

1.141

1.530

162.606

24.514

5.890

103.249

82.654

0.889

1.070

1.655

7.871

1.120 -1.9%

1.486 -2.9%

149.201 -8.2%

21.558 -12.1%

4.413 -25.1%

67.275 -34.8%

72.459 -12.3%

0.877 -1.3%

1.113 4.0%

1.611 -2.7%

7.734 -1.7%

1.227

1.563

174.805

24.416

6.374

103.249

91.467

0.899

1.080

1.590

8.023

(1) The average exchange rate of the Argentine Peso for both 2020 and 2019 was equal to the spot exchange rate at 31 December 2020 and 31 December 2019 respectively.

2. Sales by region

Sales for 2020 are analysed by geographical region and core market below. Unless otherwise stated, the comments relate to the organic change in each market.

• Americas

The region, broken down into its core markets below, recorded an overall organic decrease of -1.8% (+2.5% in the fourth quarter). The region is predominantly off-premise skewed, particularly North America, with the channel estimated to account for approximately 65% of the region's overall pre-Covid-19 sales.

for the years ending

% of Group total

2020

2019

€ million

€ millionUS 28.6%

Jamaica 5.1%

Canada 3.6%

Brazil 1.9%

Mexico 1.5% Other countries

of the region 3.0%

Americas 43.7%

53.6 773.9

3.4% 6.9% 100.0%

495.1 60.3% 11.7 108.0 13.1%

58.0 7.1% 5.4

52.0 6.3% 41.8 5.1% 66.7 8.1% 821.5 100.0%

total change

change %
fourth quarter
exchange
organic	perimeter	rateʿ¹ʾ	organic
3.4%	0.9%	-2.0%	13.0%
-17.0 -15.8%	-8.2%	-	-7.6%	-9.3%
12.5%	0.1%	-3.2%	15.8%
-15.2%	-	-21.3%	-22.7%
-31.2%	1.7%	-8.2%	-25.2%
-13.7%	0.2%	-6.0%	-8.8%
-1.8%	0.7%	-4.7%	2.5%

full year change %, of whichtotal

2.4%

9.4% -19.0 -36.5% -15.8 -37.7%

-13.0 -19.5%

-47.6

-5.8%

(1) Includes the effects associated with hyperinflation in Argentina.

The United States, the Group's largest market, with 28.6% of total sales, closed 2020 with a positive organic performance of +3.4%, following shipment recovery in the fourth quarter (+13.0%) in a predominantly off-premise skewed market (a channel which is estimated to represent approximately 70% of the market's overall pre-Covid-19 sales). The growth was driven by strong category momentum for tequila, rum and American whiskey, with verypositive performance from Espolòn tequila, Jamaican rums and Wild Turkey bourbon (particularly the higher-margin Longbranch and Russell's Reserve) respectively. On-premise restrictions impacted the overall performance, in particular for the European imports (Grand Marnier, Campari, Aperol and the Italian bitters), together with the destocking across the whole portfolio, now fully completed. Moreover, the Italian portfolio was also penalised by the introduction of import tariffs. SKYY continued to be affected by destocking at wholesaler level (impacting in particular the flavour category), ahead of a complete brand re-launch. Excluding the destocking effect, the US market organic growth would have been +9.1% in 2020.

The market showed a solid performance in the e-commerce channel, with sales up approximately +500% in comparison with 2019, now accounting for approximately 3% of the net sales in the United States3.

Brand momentum in the off-premise channel continued to be strong across the whole portfolio with sell-out growing at +32.3%, i.e. approximately 1.5 times faster than the overall market)4. The performance was strong double-digit growth since the beginning of the year for all core brands as well as the newly acquired Mexican brand Montelobos and Ancho Reyes.

Jamaica recorded a decrease in sales of -8.2% (-9.3% in the fourth quarter), suffering from a sharp reduction in tourist flows and closures in the on-premise channel due to the Covid-19 pandemic. The effect was intensified by an unfavourable comparison base with the organic results for 2019 (+17.6%), despite the good continued momentum of Wray&Nephew Overproof.

Canada, an off-premise skewed market, registered a very resilient growth of +12.5% in the year (+15.8% in the fourth quarter). The performance was driven Forty Creek, Appleton Estate, Aperol, Espolòn, Campari and Grand Marnier, as well as positive results from local brands.

Brazil, affected by the pandemic combined with the already critical macroeconomic situation, recorded a negative performance of -15.2% (-22.7% in the fourth quarter) due to uncertain contingency and its large exposure to the on-premise market. The fall in sales of Campari, Aperol and SKYY was only partially offset by a slight growth in sales of the local brand Dreher.

Mexico recorded an organic decline of -31.2% (-25.2% in the fourth quarter) within the whole portfolio, in particular SKYY ready to drink and SKYY Vodka, as well as Jamaican rums, Cinzano sparkling wines, Aperol and Grand Marnier, highly impacted by the pandemic.

The other countries recorded an overall fall in sales of -13.7% (-8.8% in the fourth quarter), driven by the negative results registered in Peru and in the remaining countries of the region. This trend was partially offset by the positive performance of Chile and Argentina, the latter driven by shipments recovery in the context of an unstable economy. As a prudent measure to strip out the effects of the high inflation local rate, the organic change in this market includes the component attributable to volumes sold only.

• Southern Europe, Middle East and Africa

The region, which is broken down by core market in the table below, reported an organic decrease of -18.6% (-30.2% in the fourth quarter). The region is predominantly on-premise skewed, with the channel estimated to account for approximately 65% of the region's overall pre-Covid-19 sales.

for the years ending

% of Group total

2020

2019

total change

full year change %, of which

change % fourth quarter

€ million

% € millionTotalorganicperimeterexchange rate

Italy 17.1%

France 5.8%

GTRʿ¹ʾ 0.5%

65.5% 22.1% 1.9%

303.8 102.5

367.0 40.3 30.1

73.6% -63.2
8.1% 62.3
6.0% -21.3
Other countries
of the region 2.7%
61.3
12.3% -12.9
-17.2% 154.7% -70.7% -21.0%
-17.4% 38.4% -68.9% -38.7%
0.1% 116.2% -1.9%
- - -
organic -32.6% 9.6% -78.9%
- 18.3% -0.6%
  -16.0%
  Southern Europe,
  Middle East and Africa 26.2% (1) Global Travel Retail.
  498.7
100.0% -35.1

-7.0%

-18.6%

11.6% -0.1%

-30.2%

Italy recorded an organic decrease in sales of -17.4% in the year which is characterized by a high level of quarterly volatility. The quarterly performance deeply reflected the consequences of the shutdown of on-premise venues following the outbreak of Covid-19 pandemic, reporting a negative change of -24.4% in the first quarter, which reached a drop of -39.3 % in the second quarter, fully mirroring the effects of the restrictions. In the third quarter, thanks to the progressive reopening of the on-premise channel during the summer period in addition to a

3 Internal data and estimates.
4 Source: US Nielsen data Total outlet combined ('xAOC') +Total Liquor, representing approximately 34% of total US off-trade volume, YTD - W/E 26 December 2020.

'staycation effect', the performance recovered, showing a very positive trend at +35.4%; finally, the second wave of pandemic, that forced new closures in the on-premise channel, generated a negative performance at -32.6% during the fourth quarter. In the year, the performance of aperitifs remained negative due to its key exposure to the on-premise channel (estimated to represent approximately 70% of the market's overall pre-Covid-19 sales), affected more heavily by the measures taken following the outbreak of the pandemic, in an economic context that is suffering from a period of strong tensions. The entire portfolio registered weak results in the year, most notably Aperol and Campari and the single-serve aperitifs (Campari Soda and Crodino), with the exception of Aperol Spritz ready-to-drink5 which registered a double-digit growth. Sell-out in the off-premise remained strong, with both Aperol and Campari tracking above +25% in 2020, while Campari Soda and Aperol Spritz ready-to-drink also grew double-digits6, and helped mitigate the sales shortfall in the on-premise channel.

France was positive at +38.4% (+9.6% in the fourth quarter) thanks to the positive transition to the Group's new wholly owned distribution structure. The performance was driven by Aperol, Riccadonna, Campari and The GlenGrant.

The Global Travel Retail recorded an organic decrease of -68.9% (-78.9% in the fourth quarter), reflecting the limitations on the movement of people following the Covid-19 pandemic, heavily impacting the whole channel.

The other countries in the region reported an overall fall of -38.7% (-16.0% in the fourth quarter), mainly due to South Africa and Spain. In particular, the latter was very weak due to the lack of international tourism and its exposure on the on-premise channel, negatively impacted by Covid-19 restrictions, with a poor performance mainly for Aperol, Campari and Bulldog. Nigeria was negative against a tough comparison base with the previous year (+27.8%), in a volatile scenario with ongoing socio-economic instability.

• Northern, Central and Eastern Europe

The region recorded overall organic growth of +6.8% (-3.0% in the fourth quarter) spread across its core central and northern European countries. The region is predominantly off-premise skewed, with the channel estimated to account for approximately 70% of the region's overall pre-Covid-19 sales.

for the years ending

% of Group total

2020

2019

total change

full year change %, of which

change % fourth quarter

€ million

% € million

organicperimeterexchange rate

organicGermany 10.3%

United Kingdom 2.8%

Russia 2.9%

182.8 49.0 50.7

Other countries of the region 6.8%

45.3% 12.1% 12.6% 30.0%

172.6 46.2 55.9

43.8% 10.2
11.7% 2.8
14.2% -5.2 -9.3%
119.0
30.2% 2.2
5.9% 5.9% 1.9%
8.6% 7.4% 10.7% 2.1%
-2.7%
-- -1.4%
- -7.3% -12.8%
- -0.1% -0.1%
  1.1% -20.4% 2.2% -5.2%
  North, Central
  and Eastern Europe 22.8%
100.0% 9.9

-2.2% -2.0%

Sales in Germany were up by +8.6% (+1.1% in the fourth quarter), driven by the double-digit performance of Aperol and Ouzo 12, as well as a positive performance for Campari, Bulldog and Cinzano sparkling wines. The non-alcoholic aperitif Crodino also grew in the year. The high exposure of this market to the off-premise channel

(estimated to represent approximately 70% of the market's overall pre-Covid-19 sales) positively contributed to organic performance.

The off-premise sell-out trends for Germany remained strong in 2020, growing twice as fast as the local market, with double-digit growth across key brands, in particular Aperol and Campari7.

Sales in the United Kingdom increased by +7.4%, sustained by the off-premise channel, with strong growth of Wray&Nephew Overproof, Aperol, Campari and Magnum Tonic; the growth was achieved notwithstanding a very negative fourth quarter (-20.4%) against a tough comparison base (+67.8% in fourth quarter 2019) and impacted by the on-premise venues closing following the second wave of the pandemic.

Solid performance in the e-commerce channel, with sales up approximately +90% in comparison with 2019, now accounting for approximately 10% of the net sales in the United Kingdom8.

The off-premise sell-out trends for the UK remained strong in 2020, growing twice as fast as the local market.

Russia recorded an increase of +10.7% in sales (+2.2% in the fourth quarter), driven by the positive growth of Aperol, Mondoro and Cinzano vermouth.

5 A stand-alone brand not included in the Aperol brand performance.
6 Source: IRI (Italy) Iper+super+Libero Servizio Piccolo ('LSP'); YTD WE 27/12/2020.
7 Germany: Nielsen Lebensmitteleinzelhandel and Drogeriemarkt ('LEH+DM') = Off-Trade (no Cash&Carry), W2-W53 2020.
8 Internal data and estimates.

Performance in the other countries in the region was up overall by +2.1% (-5.2% in the fourth quarter, impacted by the second wave of the pandemic). The positive sales growth in the year was driven by Switzerland, Belgium and Eastern European countries, mainly due to Aperol and Campari, while Austria declined, mainly due to the lack of tourism.

• Asia-Pacific

This region, which is broken down by core market in the table below, recorded organic growth of +4.6% (+2.8% in the fourth quarter). The region is predominantly off-premise skewed, with this channel estimated to account for approximately 70% of the region's overall pre-Covid-19 sales.

for the years ending

% of Group total

2020

2019

total change

full year change %, of which

change % fourth quarter

€ million

€ milliontotalorganicperimeterexchange rate

Australia 5.8% Other countries

of the region 1.5%

Asia-Pacific 7.4%

79.0% 21.0% 100.0%

88.4

68.7% 15.0
27.5 130.8
40.2
31.3% -12.7

128.5 100.0% 2.3

17.0% -31.7% 1.8%

20.2% -29.7% 4.6%

- -3.3%

- -2.0%

- -2.9%

-32.9% 2.8%

organic 18.7%

In Australia, the region's largest market, organic growth in the period was very positive at +20.2% (+18.7% in the fourth quarter) in a predominantly off-premise market (a channel which is estimated to represent approximately 85% of the market's overall pre-Covid-19 sales). The performance was driven by continued strength in Wild Turkey ready-to-drink, Wild Turkey bourbon, American Honey, Espolòn and Campari registering double-digit growth, as well as the very positive performances of Cinzano Vermouth, Frangelico, The GlenGrant and also

Espolòn off a small base. Sell-out trends in the off-premise for the Group's brands in Australia remained very positive in 2020, at +22.6% for the year, driven by Wild Turkey ready-to-drink, Wild Turkey bourbon and also Espolòn and Campari9.

Sales in the other countries in the region fell by -29.7% (-32.9% in the fourth quarter), with most markets suffering due to restrictions related to the pandemic. New Zealand and Japan registered a negative performance for sales, both being impacted by new route-to-market transitions. China also declined after a weak fourth quarter driven by destocking ahead of route-to-market change, amplified by a tough comparison base (fourth quarter 2019 +120.2%), despite the strong growth in X-Rated Fusion Liqueur.

3. Sales by main brands at consolidated level

The following table summarises growth (split into its various components) in the Group's main brands in 2020, broken down into the categories identified by the Group based on the priority (global, regional, local and other) assigned to them.

The effects of new acquisitions are shown under the external growth component, represented by perimeter variations, and contributed to the Group's results from the day after the closing date of the acquisition, if not specified differently. With regard to 2020, the Trois Rivières and La Mauny French rums were included in the regional priority brands, while the Duquesne brand was classified under local priority brands. The Ancho Reyes and Montelobos brands, resulting from the acquisition completed on 20 November 2019, were included under regional priority brands. The agency brands relating to the acquisition of CFD, which was completed on 28 February 2020, were included in the rest of the portfolio. It should be noted that the products belonging to the Campari Group portfolio sold by CFD continue to be reported as organic changes, in line with previous practice. Lallier, the Champagne brand, resulting from the acquisition completed on 10 June 2020, was classified under regional priority brands.

9 Australia: IRI Scan Data, YTD WE 27/12/2020.

percentage of Group sales

full year change %, of which

total

organic

Aperol 18.8% -1.3% Campari 9.6% -7.5%

-0.1%

-4.5%Wild Turkey portfolio(1) (2)

8.4% 2.8%

4.9%SKYY(1) 6.7% -18.3%

-16.2%

Grand Marnier 6.4% -16.5%

-14.9%

Jamaican rums portfolio(3) 5.8% -0.2% global priority brands 55.6% -6.0%

5.2% -3.8%

Espolòn 5.0% 27.0%

29.9%

Bulldog 0.6% -13.5%

-11.6%

The GlenGrant 0.9% -20.0%

-19.3%

Forty Creek 1.3% 14.2%

17.5%

Bitter and Italian liquors(4) 3.2% -16.9%

-15.6%

Cinzano 3.1% -13.6%

-9.3%

other(5) 3.9% 26.0%

regional priority brands

18.0% 3.2%

-2.1% 0.4%perimeter - - - - - - - - - - - - - 34.6% 6.1%

exchange ratechange % fourth quarter organic

-1.3% -10.3%

-3.0% -14.1%

-2.2% 29.1%

-2.1% -18.5%

-1.5% -25.6%

-5.4% 3.2%

-2.2% -7.1%

-2.8% 30.1%

-1.9% 10.5%

-0.7% -4.7%

-3.2% 42.4%

-1.3% -9.8%

-4.4% -10.8%

-6.5% 1.1%

-3.3% 3.3%

Campari Soda 2.8% -15.7%
-15.7%
Crodino 2.7% -20.3%
-20.4%
Wild Turkey portfolio ready-to-drink(6) 2.4% 19.2%
22.5%
Dreher and Sagatiba 1.0% -25.7%
-1.4%
other(7) 2.1% 15.5%
local priority brands 11.0% -7.5%

14.4% -4.4%

- - - - 2.2% 0.3%

- -30.2%

0.1% -32.6%

-3.3% 10.5%

-24.3% -16.6%

-1.0% 22.0%

-3.4% -14.0%rest of the portfolio total

15.3% 100.0%

-0.5% -3.8%

-10.0% -4.1%

12.8% 3.0%

-3.4% -15.5%

-2.7% -7.0%

(1) Excludes ready-to-drink.
(2) Includes American Honey.
(3) Includes Appleton Estate and Wray&Nephew Overproof rum.
(4) Includes Braulio, Cynar, Averna and Frangelico.
(5) Includes Riccadonna, Mondoro, Trois Rivières, Maison La Mauny, Ancho Reyes, Montelobos and Champagne Lallier.
(6) Includes American Honey ready-to-drink.
(7) Includes Duquesne.

The Group's global priority brands (55.6% of sales) fell by -3.8% at organic level, with an overall decrease of -6.0%, an exchange rate effect of -2.2% and a neutral perimeter effect. The comments below relate to the organic performance of individual brands.

Aperol recorded an almost stable performance at -0.1% during the year. The organic trend of the brand in the full year was highly impacted by the overall negative performance in core on-premise skewed markets, due to the lockdown measures to contain Covid-19 pandemic, such as the core Italian market (accounting for 31% of Aperol sales in 2020 and down by -15.2%), as well as Spain and Global Travel Retail. On the contrary, sustained growth were registered in core off-trade skewed markets like Germany (+16.9%), the United States (+7.8%), France as well as Russia, Switzerland and the United Kingdom. On a quarterly basis, following a very positive trend in the third quarter (+26.2%) favoured by positive weather conditions during July and August and the summer staycation effect in selected markets, the fourth quarter (-10.3%) was mainly affected by the re-introduction of restrictive measures which impacted the on-premise skewed markets, particularly Italy. Excluding the performance in Italy and the Global Travel Retail, the brand has grown by +11.0% in the full year.

The brand's off-premise sell-out trends continue to be very strong across its core markets in 2020, such as Germany (+31.0%) and the US (+66.5%)10.

Campari closed the year with a decline of -4.5%, heavily impacted by a negative fourth quarter performance (-14.1%), mainly driven by the on-premise skewed Italian market. In the year, the brand benefitted from double digit growth in the off-premise skewed US market (+21.5%), in the United Kingdom, France and Australia, as well as from positive results registered in the highly exposed German off-premise market. These results were not able to offset the negative performance registered in the core Italian market, with key on-premise outlets being closed during lockdown peak periods, as well as in Jamaica, Brazil, Spain and Global Travel Retail.

The brand registered strong double-digit off-premise sell-out growth across the brand's core markets in 2020, such as Italy, Germany and United States11.

The Wild Turkey portfolio, which includes American Honey, showed an increase of +4.9% in the year. The overall performance was mainly driven by the shipment recovery in the US market, particularly in the last part of the year, as well as Australia which registered double-digit growth in the year. On the other hand, the Japanese market, the brand's third largest market, was weak due to the pandemic effects and the destocking carried out by the Group ahead of the planned change in the region's route-to-market.

Strong off-premise sell-out data was registered in the core market of the United States (+25.6%12).

10 Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020; US: Nielsen data XAOC+Total Liquor, representing approximately 34% of total US off-trade value, YTD W/E 26/12/2020.

11 Italy: IRI Iper+super+LSP, YTD WE 27/12/2020; Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020; US: Nielsen data XAOC+Total Liquor, representing approximately 34% of total US off-trade value, YTD W/E 26/12/2020.

SKYY closed the year with a fall of -16.2%, mainly due to core US market down by -10.5% driven by ongoing destocking ahead of a complete brand re-launch, while SKYY off-premise sell-out trends remained positive +7.3%13. Internationally, the brand declined with the exception of Germany and Argentina.

Grand Marnier recorded a decline of -14.9%, due to the negative shipment performance in the core United States market, driven by ongoing destocking and the brand's heavy on-premise skew, as well as in the Global Travel Retail channel and France. Excluding the United States destocking effect, the overall brand performance would have been -2.4% in 2020. Solid sell-out data in the off-premise was registered in the core market of the United States at +37.8%13.

The Jamaican rums portfolio (Appleton Estate, Wray&Nephew Overproof and Kingston 62) recorded an organic growth of +5.2% in the year. Wray&Nephew Overproof achieved a double-digit growth (+21.9%) driven by Jamaica, the United States and the United Kingdom, as well as Canada favoured by a low base effect. Sales of Appleton Estate were positive (+3.1%), sustained by a favourable category trend in the premium rum, thanks to the good performance in Canada, the United States and New Zealand, boosted by the new packaging and product range, offsetting the negative trend in Jamaica, Mexico and the Global Travel Retail. The rest of portfolio registered a decline due to portfolio reshuffle, namely the launch of Kingston 62.

The sell-out trends in the off-premise in the US for Appleton Estate (+38.8%) and Wray&Nephew Overproof (+62.2%) remained very positive13.

The regional priority brands (18.0% of sales) registered a substantially neutral organic growth trend of +0.4%, with an overall increase of +3.2% achieved by a perimeter effect of +6.1% partially offset by an exchange rate effect of -3.3%. The comments below relate to the organic performance of individual brands.

Espolòn (5.0% of total sales) recorded a continued very positive double-digit performance (+29.9%), mainly driven by the core United States market thanks to solid category momentum, as well as other seeding markets such as Australia, Canada and Russia. The brand registered an off-premise sell-out growth of +87.4% in 2020 in the core market of the United States13.

Bulldog sales fell (-11.6%), due to very negative performances in its core market Spain, which suffered from the on-premise skew as well as persistent strong category competition, as well as in the Global Travel Retail and in South Africa, the latter penalised by the significant destocking ahead of the planned changes in the route-to-market structures and the pandemic effect. The overall performance was partly mitigated by positive double-digit growth results in Germany and Belgium.

The GlenGrant recorded a negative performance of -19.3% in the year. This was mainly due to a strong decline in the Global Travel Retail channel, a key strategic channel for the brand's premium variants development, which was particularly impacted by the effects of Covid-19. Italy, the United States and South Africa were also negative mainly due to the pandemic. The overall negative performance was only partially mitigated by positive results in Australia, France and Germany. The enhanced focus on the long-term repositioning of the brand, gradually shifting from high-volume and short-aged variants into premium higher-margin propositions, remains confirmed. Forty Creek recorded a positive performance of +17.5%, thanks to the results achieved in Canada.

Italian bitters and liqueurs (Cynar, Averna, Braulio and Frangelico) were negative overall (-15.6%) largely due to declines in core Italy and US markets given their on-premise skew and Global Travel Retail.

Cinzano sales fell by -9.3% overall. Performance in the sparkling wines segment was negative due to the weakness in core Italian and Russian market, as well as in Japan, China and Switzerland, which completely offset the positive results registered in Germany and selected East European markets. In the vermouth segment, the negative performance was mainly attributable to Italy, as well as Eastern Europe markets, where the decline was due to brand repositioning as traditional vermouth. On the contrary, growth was registered in Russia, Argentina and Australia.

In the other brands, Bisquit&Debouché cognac recorded a decline, mainly in South Africa, currently the brand's core market. Mondoro and Riccadonna recorded a positive performance. The former was driven by its core Russian market, whilst the latter by the French market, positively impacted by both the change in route-to-market and Aperol's positive trend.

The local priority brands (11.0% of the Group's portfolio) showed an organic sales decrease of -4.4%, with an overall variation of -7.5%, an exchange rate effect of -3.4% and a perimeter effect of +0.3%. The comments below relate to the organic performance of individual brands.

The organic performance of the local priority brands is due to the contraction in sales of the Italian single-serve aperitifs, Campari Soda and Crodino, which were particularly impacted by the performance in the key Italian market due to their very large exposure into the on-premise channel and therefore were particularly impacted by Covid-19 pandemic. In seeding markets, the brand grew overall by mid-single digit thanks to the performance in Switzerland, Belgium, Austria and Germany, benefiting from the new brand roll-out. Wild Turkey ready-to-drink recorded a very positive performance, driven by its key Australian market; Ouzo 12 and Cabo Wabo registereda good performance as well thanks to their key markets, Germany and United States respectively, while the Brazilian brand (Dreher and Sagatiba) showed a slight decline.

The rest of the portfolio (15.3% of sales) recorded a negative organic performance of -10.0%, mainly due to SKYY ready-to-drink in Mexico and Japan, as well as the agency brands, partly mitigated by the very positive performance of Aperol Spritz ready-to-drink14 in Italy and X-rated fusion liquor in the core market of China, despite new route-to-market setup.

14 A stand-alone brand not included in the Aperol brand performance.

Statement of profit or loss

Key highlights

The profit or loss figures for the full year 2020 suffered heavily from the effects of the unexpected impact of the Covid-19 pandemic. Starting from the end of the first quarter, severe restrictions were progressively introduced, including the suspension of productive activities defined as non-essential (which does not include beverages),

having a strong impact on end clients' propensity to consume, particularly in on-premise skewed markets where the high-margin aperitif business was mostly affected. During the third quarter 2020, with the progressive uplifting of restrictive measures after the lockdown, the Group's business performance benefitted from a temporary recovery in the aperitifs business in its peak summer season for core on-premise markets. Moreover, it benefitted from the consumption generated by people spending holidays in their home country rather than abroad ('staycation' effect), whilst home spirits consumption continued in off-premise skewed regions. After a brief temporary summer relief, the impact of the so called 'second wave', which has brought new, even if generally a little less stringent, restrictions on people's lives and habits across all markets, led to an overall decline in fourth quarter 2020 which impacted, once again, particularly the on-premise skewed markets. At year-end the situation still remains uncertain given the spread of the pandemic and is highly dependent on the vaccine administration.

Therefore, despite a particularly favourable start to the year in many geographic regions, the 2020 business results reflected the effects of a new economic situation, which was by no means foreseeable. While strong brand momentum remained very healthy as shown by sustained sell-out trends in the off-premise channel, the year was heavily influenced by the Covid-19 pandemic measures, which affected on-premise skewed markets in particular. As such, net sales and all the profitability indicators monitored by the Group resulted in a negative organic performance on a full year basis.

Specifically, in 2020 net sales, gross margin, contribution margin and the result from recurring activities (EBIT adjusted) showed an organic overall annual decline of -4.1%, -8.5%, -11.0% and -20.4% respectively. All the indicators showed a greater decrease than sales, with a resulting dilution in margins. In particular, in terms of EBIT adjusted, the overall organic dilution of 380 basis points reflected a negative sales mix (driven by the severe decline in high margin combinations of brands and markets, such as the aperitifs), the pressure of the increase in the agave purchase price, the negative impact of US import tariffs, as well as a lower absorption of fixed costs across the profit or loss, given the drop in sales. Advertising investments and selling, general and administrative expenses, as well as advertising investments, decreased organically, though to a lower degree than net sales driving a limited dilutive effect.

A cost analysis was carried out at Group level aimed at containing variable and discretionary structure costs. With regard to advertising investments, brand activation initiatives have been re-phased on a selected basis to refocus on core priorities during this particular year, and progressively shifted from the on-premise channel into digital and online, as well as e-commerce. At selling, general and administrative expenses level, the containment of the discretionary component was mainly driven by hiring freeze policies and travels bans initiatives. Finally, with regard to non-discretionary spending, no structural downsizing actions were taken as regards the Group's infrastructure in the context of Covid-19. The Group confirmed its unchanged commitment to its long-term development strategy, such as via the deployment of initiatives previously planned to support the Group's growth strategy, and the continued strengthening of its route-to-market structures. Meanwhile, within the context of a very challenging year, resources have particularly focused on a continuous enhancement of the IT infrastructure, further hardened after the malware attack suffered in the fourth quarter, a regular monitoring of supplier and customer performances, prudent liability management to prevent liquidity issues, as well as a general redefinition of ways of working by introducing new protocols, work practices and safety measures across the organisation.

The perimeter variations relate mainly to the recent acquisitions of Rhumantilles S.A.S., Ancho Reyes and Montelobos, completed in the latter part of 2019, the acquisition of Campari France Distribution S.A.S., finalised on 28 February 2020, and the acquisition of Champagne Lallier S.a.r.l., completed on 10 June 2020 which entered the consolidation perimeter from 30 June 2020 onwards. The perimeter disclosure also includes the effect deriving from the termination of some low-margin distribution agreements, which in any case contributed in a very limited way to the business's performances.

With regard to the total changes in profitability indicators, the favourable exchange rate effect was driven by the strong devaluation in currencies in low-margin emerging markets against the Euro. At the level of EBIT adjusted, this effect was offset by the negative perimeter impact due to the disproportional weight of structure of costs of the newly acquired businesses when compared to the net sales value, severely impacted by Covid-19. The table below shows the profit or loss(1) for 2020 and a breakdown of the total change by organic growth, external growth and exchange rate effects.

For the years ending 31 December

Net salesʿ²ʾ

Cost of sales Gross profit

Advertising and promotional costs

Contribution margin Selling, general and administrative expenses Result from recurring activities (EBIT-adjusted)

Other operating income (expenses)

Operating result

Financial income (expenses) Adjustments to financial income (expenses)

Put option, earn out income (expenses) and hyperinflation effect

Profit (loss) related to associates and joint ventures

Profit before taxation and non-controlling interests Profit before taxation and non-controlling interests-adjusted

Taxation

Net profit for the period Net profit for the period-adjusted

Non-controlling interests Group net profit for the period Group net profit adjusted Total depreciation and amortisation

EBITDA-adjusted EBITDA

2020

€ million

2019 € milliontotal change

€ million

of which organic

€ million

of which external

€ million

1,772.0

(746.1) 1,025.9

(309.8)

716.1

(394.2)

321.9

(90.1)

231.8

100.0

(42.1)

57.9

(17.5)

40.4

(22.2)

18.2

(5.1)

13.1

1,842.5

100.0

(721.3) 1,121.2

(39.1)

60.9

(70.4) -3.8% (24.8) 3.4% (95.3) -8.5%

(319.9)

(17.4)

10.1 -3.1%

801.3

43.5

(85.2) -10.6%

(393.3)

(21.3)

(0.9) 0.2%

408.0

22.1

(86.1) -21.1%

(21.7)

(1.2)

(68.4) 315.6%

386.3

21.0 (154.5) -40.0%

(74.8)

(20.6)

(95.4)

-4.1% 2.9% -8.5%

54.6 3.0%
(40.0) 5.5%
14.6 1.3%
(4.2) 1.3%
10.4 1.3%
(19.0) 4.8%
(8.6) -2.1%

6.9

(88.4)

5.4

(83.0)

-2.2%

- 11.0%

-1.4%

- 20.4%

(38.9)

1.4

18.1

(2.8)

209.6

278.9

(2.2)

0.1

1.0

(0.2)

11.8

15.7

(33.0)

(1.8)

(5.9) 17.9%
5.8
0.3
(4.4) -75.9%
(4.7)
(0.3)
22.8 -487.8%

0.1

-(2.9)

354.6

19.2

(145.0) -40.9%
370.4
20.1
(91.5) -24.7%

(22.7) 186.9

201.1

(1.3) 10.5

11.3

(46.2) 308.4

(2.5) 23.5 -50.8%

267.4

16.7 14.5

(121.5) -39.4%
(66.3) -24.8%

(1.0) 187.9 202.1

(0.1) 10.6 11.4

- 308.4 267.4

- 16.7 14.5

(1.0)

(120.5) -39.1%
(65.3) -24.4%

(78.0)

399.9 309.8

(4.4)

22.6 17.5

(71.8)

(3.9)

(6.2) 8.6%

479.8 458.1

26.0 24.9

(79.9) -16.7% (148.3) -32.4%

(4.9)

(78.2)

6.8%

- 16.3%

(4.1) 5.7%
(4.5) -0.9%

of which due to exchange rates and hyperinflation

€ million

(50.3) -2.7%
35.7 -5.0%
(14.5) -1.3%
7.4 -2.3%
(7.2) -0.9%
12.7 -3.2%
5.5 1.4%

2.7 -3.8%
2.8 0.6%

(1) For information on the definition of alternative performance measures, see the paragraph 'Definitions and reconciliation of the Alternative Performance Measures (APMs or non-GAAP measures) to GAAP measures' of this management report.
(2) Sales after deduction of excise duties.

The decrease in profitability in 2020 shown by the operating profitability indicators, expressed as a percentage (basis points) of total net sales and organic sales, is shown in the following table(1).

margin accretion (dilution) in basis point(2)	Total	Organic
Cost of goods sold	(300)	(280)
Gross margin	(300)	(280)
Advertising and promotional costs	(10)	(30)
Contribution margin	(310)	(320)
Selling, general and administrative expenses	(90)	(60)
Result from recurring activities (EBIT-adjusted)	(400)	(380)

(1) For information on the definition of alternative performance measures, see the paragraph 'Definitions and reconciliation of the Alternative Performance Measures (APMs or non-GAAP measures) to GAAP measures' of this management report.
(2) There may be rounding effects given that the corresponding basis points have been rounded to the nearest ten.

Statement of profit or loss in detail

The key profit or loss items are analysed below.

See the previous paragraph 'sales performance' for a detailed analysis of sales for the period.

The gross profit for the period was €1,025.9 million, -8.5% on 2019. The organic component was -8.5%, which was higher than the organic decrease in sales (-4.1%), while the perimeter variation of +1.3% was completely offset by the exchange rate effect. As a percentage of sales, the gross margin fell overall, from 60.9% in 2019 to 57.9% in 2020, with a decrease in total and organic profitability as a percentage of sales of 300 and 280 basis points respectively. The organic dilution of profitability was mainly driven by the unfavourable sales mix, led by the outperformance of low margin Espolòn characterized by the high agave price, the underperformance in high margin aperitifs brands in core on-premise skewed Italian market (particularly Aperol, Campari and the single-serve aperitifs Campari Soda and Crodino), the destocking driven declines in high-margin SKYY Vodka and European imports in the United States, the negative impact of US import tariffs, all combined with a lower absorption of fixed production costs.

The exchange rate effect of an 80 basis point accretion in the period was more than offset by the perimeter effect having a 100 basis point dilution.

Advertising and promotional costs were €309.8 million, down by -3.1% overall compared to 2019, with a decrease of -2.2% in organic values (compared with a decline in net sales of -4.1%). As a percentage of sales, they increased from 17.4% to 17.5% in 2020 and generated an organic dilution effect on sales of 30 basis points. Throughout the year, due to the lockdowns and the general restrictions limiting people traffic in the on-premise channel, brand activation investments were progressively redirected from on-premise into digital and online brand activations, e-commerce initiatives, as well as off-premise brand building activities. In this respect, after the cost containment actions taken in the first part of the year, advertising investments (mostly a discretionary expense) were recovered via a rephasing into the last two quarters. The main objective has been to engage consumers and industry professionals through social media, driving home consumption through e-commerce platforms and further leverage of modern trade. In line with this strategy, the Group has significantly stepped up its digital capabilities to support on-line marketing, with a strong focus on core brands.

The contribution margin was €716.1 million, an overall decrease of -10.6% compared to 2019. As a percentage of sales, it was at 40.4%, an overall dilution of 310 basis points compared to 2019 year. The organic growth component fell by -11.0%, more than the decline in organic sales growth (-4.1%), generating an organic dilutive effect of 320 basis points. The negative exchange rate effect of -0.9% had an accretive effect on margins of 70 basis points; this offset the perimeter variations, having a dilution effect of 60 basis points (up by +1.3% on the previous year).

Selling, general and administrative expenses, a predominantly fixed cost type of expense, amounted to €394.2 million, almost stable (+0.2%) in comparison to the previous year. As a percentage of sales, they amounted to 22.2%, compared to 21.3% in 2019, with a resulting dilutive effect on margins of 90 basis points. The organic change was at -1.4% and generated an organic dilutive effect of 60 basis points on margin due to the lower absorption of fixed costs in the context of an organic contraction in sales. Although no structural downsizing actions were undertaken with regard to the business infrastructure in the context of Covid-19, the containment of variable and discretionary costs was mainly driven by hiring freeze policies as well as a reduction in travelling and entertainment expenses. Finally, the costs of 2020 reflected the revision of the estimated target-based incentives which unfortunately were not achieved following the 2020 business results heavily affected by the pandemic.

The result from recurring activities (EBIT adjusted) was €321.9 million in 2020, an overall decrease of -21.1% on 2019. The return on sales adjusted (ROS) was 18.2% (22.1% in 2019). The organic decline component was -20.4%, with a tough comparison base with the same period in 2019 (+6.7%). The decrease was stronger than that of organic sales (-4.1%), thus resulting in a dilutive effect of 380 basis points. Excluding the US destocking effect (approximately €19 million), the EBIT adjusted change would have been -15.7%. The impact of perimeter variations on EBIT adjusted was -2.1%, mainly due to the unfavourable impact of recent acquisitions: reference is made in particular to the disproportionate effect deriving from the first time consolidation of the French distributor, given the very limited absorption of fixed structure costs in 2020, due to the lower sales levels impacted by the pandemic. On the other hand, the exchange rate effect was +1.4%, generated by the strong devaluation in currencies in low-margin emerging markets against the Euro.

Other operating income (expenses) showed a net charge of €90.1 million. This related namely to the following significant events or transactions affecting the year:

- €35.4 million attributable to brand impairment losses on Bulldog (€16.0 million15), The GlenGrant (€15.5 million) and Rhum Agricole (€3.9 million) as a consequence of the negative impact of Covid-19 on the brand performances particularly given their significant exposure to Global Travel Retail and on-premise, not expected to fully recover in the short term;
- €21.4 million of restructuring costs: €13.5 million related to the sugar business in Jamaica and €7.9 million for the reorganisation activities impacting some of the Group's central operations, which were started in previous periods;
- €15.9 million of transaction fees in connection with the transfer of the Company's registered office to the Netherlands (€9.9 million), as well as transaction fees in connection with recent acquisitions and changes in route to market (€6.0 million);
- €17.4 million of other costs connected to special projects, legal disputes as well as costs related to direct donations made by the Group to support the pandemic emergency and costs connected to IT restoration

15 Value determined based on average exchange rate for the period 1 January-31 December 2020, equivalent to €15.8 million at the closing exchange rate at 31

December 2020.

operations as a result of the malware attack suffered in November 2020, aimed at further protecting the Group's IT estate.

The operating result in 2020 was €231.8 million, reflecting a decrease of -40.0% from 2019. The ROS, which measures the operating result as a percentage of net sales, amounted to 13.1% (21.0% in 2019).

Depreciation and amortisation totalled €78.0 million, up +8.6% on 2019, of which +6.8% was at organic level. The perimeter variation relating to recent acquisitions accounted for +5.7% and was partially offset by exchange rate variations of -3.8%.

EBITDA adjusted was €399.9 million, a decrease of -16.7%, of which -16.3% was at organic level, while the positive +0.6% contribution of the exchange rate effects was substantially compensated by the -0.9% perimeter impact.

EBITDA was €309.8 million, a decrease of -32.4% compared with 2019 (€458.1 million).

Net financial expenses totalled €38.9 million, showing an increase of €5.9 million compared to the same period of 2019 (€33.0 million). The negative variance of €6.9 million of exchange gain/(loss) was mainly due to the exchange gain/(loss) as net financial expenses included €4.1 million exchange loss in 2020 compared with a €2.8 million exchange gain in 2019.

Excluding the exchange gain/(loss), net financial expenses showed a saving of €1.0 million, despite the higher average level of net debt in the year ending 31 December 2020 (totalling €979.6 million, compared with €865.8 million in the year ending 31 December 2019). In particular the average cost of net debt for 2020, excluding the component relating to exchange gain(loss), was 3.5%, showing an improvement compared with the 4.1% reached in 2019, with both periods impacted by the negative carry effect. This decrease is mainly attributable to the reduced average coupon on existing gross debt, thanks to the liability management carried out. The favourable trend in the average cost of gross debt demonstrates the soundness of the Group's financial profile, further strengthened thanks to the new bond issue completed on 6 October 2020 with very attractive conditions, which led to an average cost of nominal coupons on gross debt decreasing from 2.15% to 1.42% post transaction.

Positive adjustments to financial income (expenses) of €1.4 million were recorded for the year 2020. These adjustments related mainly to a liability management transaction for the term loan subscribed in July 2019, to which minor amendments were made to benefit from better financial terms and conditions.

The item income (expenses) relating to put options, earn out and hyperinflation effects was positive and totalled €18.1 million. It includes income totalling €18.8 million attributable to the non-cash effects of the remeasurement and discounting to present value of the estimated liabilities for future commitments relating to earn out and minority shareholdings in the acquired businesses. The decrease is mainly due to the revision of projected cash out from the Bulldog earn out (€19.4 million), the basis of the estimate having been linked to the expected future brand performance and the revision conducted in conjunction with impairment test of intangible assets to ensure consistency. The item also includes expenses arising from the application of the hyperinflation management measures to the Argentina accounts, totalling a net expense of €0.7 million.

The profit (loss) related to associates and joint ventures was a charge of €2.8 million, mainly related to the joint venture in Japan and essentially due to the lower absorption of fixed structure costs in a context of low level of sales.

Profit before taxation and non-controlling interests was €209.6 million, a decrease of -40.9% compared with 2019. Profit before taxation as a percentage of sales was 11.8% (19.2% in 2019).

Taxation totalled €22.7 million on a reported basis. The reported tax rate in 2020 was 10.8%, compared with a reported tax rate of 13.0%. The overall tax amount in 2020 included recurring income tax of €77.9 million and positive tax adjustments totalling €55.1 million. The latter reflected the favourable tax effects arising from the operating and financial adjustments as well as other, purely fiscal, adjustments. In particular, the merely fiscal adjustments included a one-off benefit of €29.9 million related to the remeasurement of deferred tax liabilities as a result of the step-up of certain brand and goodwill fiscal values to their corresponding book values, as stated in the Company's separate accounts. The positive reversal of deferred tax liabilities recorded in 2020 profit or loss is net of the substitutive tax to be paid in order to access the fiscal benefit. While the one-off impact is recognized in the 2020 profit or loss, the expected recurring tax benefit in the profit or loss statement, originated from a deductible notional amortization of the new stepped-up value of brand and goodwill assets valid for fiscal purposes only, will start from fiscal year 2021, generating its cash tax savings effects starting from fiscal year 2022 onwards. This benefit is granted to Italian companies pursuant to Law Decree no. 104/2020, enacted in August 2020 andconverted with amendments into Law no.126/2020 in October 2020. The Company's Board of Directors, held on 17 December 2020, confirmed the decision to adhere to the aforementioned tax rule for eligible intangible assets booked in the Company's separate accounts.

The 2020 overall tax adjustment compared with the figure of €56.8 million reported in 2019, which mainly included a one-off benefit of €25.4 million related to Patent Box tax regime: 2019 was the last year of the five years granted for the one-off tax relief based on the agreements signed with the Italian tax authorities.

The normalised tax rate, i.e. the ratio of normalised income taxation to the Group's profit before taxation, excluding other operating income and expenses, adjustments to financial and tax income and expenses for the year, was 27.9% in 2020, in line with the rate of 27.8% recognised in 2019.

Lastly, excluding the impact of the non-cash component relating to the deferred taxes on the fiscal amortization of historical goodwill and brands relevant for tax purposes, which decreased from €15.8 million of last year to €13.1 million, the 2020 tax rate for the cash components alone was 23.2%, slightly lower than the rate of 23.5% reported at year ending 31 December 2019 on a consistent basis.

Result relating to non-controlling interests for the period was marginal and corresponds to a loss of €1.0

million.

The Group's net profit was €187.9 million in 2020, a decrease of -39.1% compared with 2019, with a sales margin of 10.6%, lower than the 16.7% seen in the previous year. However, after excluding adjustments to operating, financial and put options and earn out, the related tax effects and tax components, the Group's net profit was €202.1 million (€267.4 million in 2019).

Basic and diluted earnings per share16, were €0.17 and €0.16 respectively, and amounted to €0.18 and €0.17 once adjusted for the afore-mentioned components. Adjusted basic earnings per share and adjusted diluted earnings per share were down by -23.7% and -23.5% respectively compared with 2019.

The profit before tax and net profit, total and adjusted to take into account other operating income and expensed and adjustments to financial income and expenses, together with the related tax effects and other tax adjustments, are shown below.

for the years ending 31 December

2020 € million

2019 € million

total adjustments to operating income (expenses), of which:	(90.1)	(21.7)
brands impairment losses	(35.4)
restructuring and reorganisation costs	(21.4)
other adjustments to operating income (expenses)	(33.3)
total adjustments to financial income (expenses)	1.4	5.8
total adjustment related to remeasurement of put option and earn out	19.4	-
total tax adjustments, of which:	55.1	56.8
tax benefit from Italian Legislative Decree 104/2020	29.9
Patent Box	-
tax adjustments	2.2
tax effect on operating and financial adjustments	23.0
total net adjustment	(14.2)	41.0

5.4

(9.5) (12.2)

- 25.4 26.0

for the years ending 31 December

net profit for the period tax rate (nominal and adjusted)

186.9 -10.8%

(14.2)

201.1 -27.9%

354.6 (46.2) 308.4 -13.0%

€ million profit before tax before minorities total taxation

reported 209.6 (22.7)

2020 adjustments adjusted

2019 reported adjustments adjustedchanges reported adjusted

(69.3)

55.1

278.9 (77.9)

(15.8) 370.4 -40.9% -24.7%

56.8 (103.1) 41.0 267.4

-50.8% -24.5%
-39.4% -24.8%

- -27.8%

deferred taxes on goodwill and brands

(13.1)

(15.8)

cash tax rate

-23.2%

(15.8) -23.5%

16 For information on the definition of alternative performance measures, see the paragraph 'Definitions and reconciliation of the Alternative Performance Measures

(APMs or non-GAAP measures) to GAAP measures' of this management report.

Profitability by business area

A breakdown of the four geographical regions in which the Group operates is given below and shows the percentage of sales and of the operating result for each segment for the two years under comparison.

Please refer to the 'Sales performance' paragraph of this management report for a more detailed analysis of sales by business area for the year.

For the years ending 31 December

2020

2019

net sales € million

% of total %

result from recurring activities € million

% of total %net sales € million

% of total %

result from recurring activities € million

% of total %

Americas

Southern Europe, Middle East and Africa

Northern, Central and Eastern Europe Asia-Pacific

Total

773.9 463.6

403.7

130.8 1,772.0

43.7% 26.2%

22.8% 7.4% 100.0%

139.7 32.5

133.2

16.5 321.9

43.4% 10.1%

41.4% 5.1% 100.0%

821.5 498.7

44.6% 27.1%

171.4 42.0%
88.1 21.6%
393.8
128.5 1,842.5
21.4% 7.0% 100.0%
132.9 32.6%
15.6 3.8%
408.0 100.0%

• Americas

The Americas region made the largest contribution to the Group in terms of both sales and result from recurring activities, at 43.7% and 43.4% respectively.

The direct markets of US, Jamaica, Canada, Brazil, Mexico, Argentina and Peru together account for nearly all the region's sales. The results for 2020 are shown below.

Net sales Gross margin

Advertising and promotional costs

Selling, general and administrative expenses Result from recurring activities

2020

€ million

773.9

429.4

(141.2) (148.5)

139.7

100.0

55.5

(18.2) (19.2)

18.1

For the years ending 31 December organic

2019

total change

organic change

€ million

821.5

100.0

479.7

58.4

(47.6) (50.3)

-5.8%

(14.8) -1.8%

accretion/dilution of profitability basis points -

-10.5% (44.8) -9.3% (450)

(157.3) (151.0)

(19.1) (18.4)

16.1

-10.2% 13.1 -8.3% 130

2.5

-1.7% (5.3) 3.5% (100)

171.4

20.9

(31.7)

-18.5% (37.0) -21.6% (420)

The result from recurring activities decreased by -18.5% overall and recorded a sales margin of 18.1% compared with 20.9% for the previous year. The organic change was -21.6%, having a dilutive effect of 420 basis points on profitability. The main drivers that affected these organic results were as follows:

- gross margin decreased in value by -9.3% at organic level and, as this was lower than sales growth (-1.8%), it resulted in a consequent dilution of profitability of 450 basis points. The decline in gross profitability was mainly due to an unfavourable channel and sales mix, driven in particular by the outperformance of Espolòn, with margin continuing to be dampened by the elevated agave purchase price, the negative impact of US import tariffs and severe destocking in high-margin brands (SKYY Vodka and European imports), exacerbated by a lower absorption of fixed production costs, due to the lower net sales level;
- advertising and promotional costs recorded an organic decrease of -8.3%. Over the year, this result was the combined effect of the phasing of spending throughout the twelve months particularly on global priorities (SKYY Vodka, ahead of complete brand relaunch) and the rationalization of promotional investments shifting from an offline to an online focus. The disproportional decrease in this cost item, compared with organic sales growth, had an accretive effect of 130 basis points;
- selling, general and administrative expenses increased by +3.5% at organic level, higher than organic sales growth, which resulted in a deterioration in profitability of 100 basis points, due to a lower absorption of fixed costs given the top-line decline and only partly mitigated by the streamlining of some local structures in the region.

• Southern Europe, Middle East and Africa

The Southern Europe, Middle East and Africa region is the Group's second-largest region in terms of net sales, at 26.2% and the third-largest in terms of profitability at 10.1%. This region was strongly impacted by the lockdown measures implemented to fight the Covid-19 pandemic mainly due for Italy the region's largest market, being largely exposed to the on-premise and high-margin aperitifs business. Besides Italy, the other key markets of France, Spain, South Africa and Nigeria, together with the Global Travel Retail channel, accounting for nearly all the sales in this region, were also significantly impacted by Covid-19. The results for 2020 are shown below.

For the years ending 31 December

Net sales Gross margin

Advertising and promotional costs

Selling, general and administrative expenses Result from recurring activities

2020

€ million

463.6 279.4

(90.6) (156.3)

32.5

100.0

60.3

(19.5) (33.7)

7.0

€ million

2019

total change

organic change

€ million

498.7 333.1

100.0

66.8

(35.1) (53.7)

-7.0%

(92.7) -18.6%

organic accretion/dilution of profitability basis points -

-16.1% (67.1) -20.1% (130)

(89.2) (155.8)

(17.9) (31.2)

(1.4) (0.6)

1.6% (0.4) 0.4% (420)

0.4% 15.7 -10.1% (330)

88.1

17.7

(55.6)

-63.2% (51.8) -58.8% (870)

The result from recurring operations decreased by -63.2% overall and recorded a sales margin of 7.0% compared with 17.7% for the previous year. Organic change was -58.5%, having a dilutive effect of 870 basis points on profitability. The main drivers that affected these organic results were as follows:

- gross margin showed an organic decrease of -20.1%, equivalent to a dilution of 130 basis points, due to an unfavourable sales mix driven by on-premise closures, having an adverse impact particularly on the high-margin aperitifs category in core Italian market combined with lower absorption of fixed production costs. The year was characterized by high level quarterly volatility in connection with the measures to combat the Coronavirus leading to a decline driven particularly by the on-premise skewed markets. The Global Travel Retail channel was heavily impacted by travel restrictions due to the pandemic and so too the rest of the region skewed into on-premise markets, such as Spain, were also affected with an adverse impact on margins;
- advertising and promotional costs were almost stable (+0.4%) in comparison with the previous year, reflecting the gradual recovery of key initiatives focused on the main brands in the second part of the year (such as the Campari sponsored Venice Film Festival and the Averna new campaign), characterized by a temporary recovery of the business, and a continuous shift of brand building investments in aperitifs to drive consumption, from off to online. The dilutive effect generated was 420 basis points;
- selling, general and administrative expenses diminished by -10.1% at organic level, though at a lower rate than the top line, thus having a dilutive effect on profitability of 330 basis points. The reduction compared to last year was driven by the cost optimization initiatives implemented at Group level, particularly for variable costs, including hiring freezes policies and a travel ban. The costs for the year also reflected the reduction in employee bonus amounts as annual business results were heavily affected by the pandemic.

• Northern, Central and Eastern Europe

The Northern, Central and Eastern Europe region is the Group's third-largest region in terms of net sales, and the second largest in terms of profitability, at 22.8% and 41.4% respectively. Thanks to the large exposure of this geographical area to the off-premise channel, the effects of the Covid-19 outbreak were more limited compared with other regions and a positive organic performance in net sales and result from recurring operations was achieved.

The region includes the direct markets in Germany, Austria, Switzerland, Benelux, the UK, Russia and Ukraine, which represent nearly all the sales in the region, and the markets served by third-party distributors. The results for 2020 are shown below.

Net sales Gross margin

Advertising and promotional costs

Selling, general and administrative expenses Result from recurring activities

2020

€ million

403.7 255.9

(60.4) (62.3) 133.2

100.0

63.4

(15.0) (15.4)

33.0

For the years ending 31 December organic

2019

total change

organic change

€ million

393.8 248.5

100.0

9.9

2.5%

26.7 6.8%

accretion/dilution of profitability basis points -

63.1

7.4

3.0% 13.5 5.4% (80)

(55.6) (60.0) 132.9

(14.1) (15.2)

(4.8) (2.2)

8.7% (5.6) 10.0% (40)

3.7% (3.6) 6.1% 10

33.7

0.4

0.3% 4.3 3.2% (110)

The result from recurring activities was almost stable (+0.3%) overall and recorded a sales margin of 33.0%, compared with 33.7% reported in the previous year. Organic growth was +3.2% having a dilutive effect of 110 basis points. The main drivers that affected these organic results were as follows:

- gross margin showed solid organic growth of +5.4%, although lower than sales growth. This led to a dilution of profitability of 80 basis points due to the unfavourable geographic/product mix with the outperformance of lower-margin brands in Russia partly mitigated by the positive mix driven by Germany;
- advertising and promotional costs increased by +10.0% highlighting a phasing effect from the first into the second part of the year of the initiatives focused on the main brands, with a dilution effect on profitability of 40 basis points;
- selling, general and administrative expenses showed an increase of +6.1%, at a lower rate than the sales growth and therefore generating an accretive effect of 10 basis points on profitability.

• Asia-Pacific

The Asia-Pacific region includes the Group's own Australian sales platform, as well as markets served by joint ventures and third-party distributors. The region's contribution to the Group's net sales and result from recurring

activities in 2020 were 7.4% and 5.1% respectively. The results for 2020 are shown below.

Net sales Gross margin

Advertising and promotional costs

Selling, general and administrative expenses Result from recurring activities

2020

€ million

130.8

61.3

(17.6) (27.2)

16.5

100.0

46.8

(13.5) (20.8)

12.6

For the years ending 31 December organic

2019

total change

organic change

€ million

%accretion/dilution of profitability basis points

128.5

100.0

60.0

46.6

(17.8) (26.5)

(13.9) (20.6)

2.3 1.3 0.2 (0.6)

15.6

12.1

0.9

1.8% 2.2% -1.2% 2.3% 5.8%

5.9 4.6%
-
3.0 5.1%
(0.3) 1.5%
(1.4) 5.1%
20 40 (10)
1.4 9.1%

The result from recurring activities increased by +5.8% overall and recorded a sales margin of 12.6% compared with 12.1% reported in the previous year. The organic variation was positive at +9.1%, with a corresponding accretion in profitability of 50 basis points, due to the following effects:

- gross margin grew by +5.1% at organic level, resulting in an improvement in profitability of 20 basis points, driven by the favourable sales mix within the region and thanks to improved profitability in local priorities in Australia;
- advertising and promotional costs were up by +1.5%, lower than the organic sales growth, with an accretive effect on profitability of 40 basis points;
- selling, general and administrative expenses increased by +5.1% with a dilutive effect of profitability of 10 basis points. The increase was mainly due to costs related to route to market initiatives and the transfer of the regional offices from Sydney to Singapore, in order to benefit from a more centrally located position with regards to the main Asian market.

Operating working capital

The breakdown of the total change in operating working capital compared with the restated figure at 31 December 2019 is as follows.

At 31 December

of which

2020 € million

2019⁽¹⁾

€ milliontotal change € million

organic € million

perimeter⁽²⁾

€ millionexchange rates and hyperinflation € million

Trade receivables

Total inventories, of which:

- maturing inventory
- biological assets
- other inventory

Trade payables

Operating working capital Net sales of the period

281.8 656.8 368.1

1.6

287.0

(321.2)

316.8 (35.0)

(42.0)

38.8

(31.8)

616.7 40.1

47.7

35.6

(43.3)

374.4 (6.3)

20.1

0.9 0.8

0.9

- -

(26.3)

(0.1)

241.5 45.6

26.8

35.6

(16.8)

(241.2) (80.0)

(49.2)

(44.6)

13.7

617.4 1,772.0

692.3 (74.9) 1,842.5

(43.4)

29.8

(61.4)

Working capital as % of net sales rolling

34.8

37.6

(1) Values as of 31 December 2019 reclassified for Purchase Price Allocations. For information on the reclassifications of comparative figures, refer to note 3 xi-
'Reclassification of comparative figures at 31 December 2019' of Campari Group consolidated financial statements at 31 December 2020.
(2) The change includes an overall marginal impact of €0.9 million, related to the exit from the consolidation area of the Japanese Group's commercial company operating in Japan market following changes in the local distribution structure.

Operating working capital at 31 December 2020 was €617.4 million, a decrease of €74.9 million compared with the balance at 31 December 2019. This change was the combined effect of the following drivers: an organic decrease of €43.4 million, driven by an increase in inventories, totalling €47.7 million, more than offset by the favourable combined effect of an increase in trade payables of €49.2 million and a decrease in receivables from customers, of €42.0 million; a perimeter effect driven by the acquisitions closed during the year for an amount of €29.8 million, as well as an exchange rate variation leading to a reduction of €61.4 million.

Focusing on the organic performance, the decrease in trade receivables of €42.0 million is mainly driven by a temporary working capital reduction at year-end, due to phasing effects generated by the renewed restrictions impacting business performance. In particular, the decrease in receivables by €35 million was a consequence of the business slowdown in the fourth quarter in connection with the new restrictions due the pandemic 'second wave', whilst the increase in payables by €49.2 million was due to phasing.

Notwithstanding the unfavourable economic environment, customer payments terms remained broadly unchanged across all geographies.

Inventory registered an increase totalling €47.7 million, out of which €20.1 million related to the organic step up in ageing liquid supporting the maturation process, mostly linked to The GlenGrant and Bisquit&Debouché cognac maturing inventory. It should be noted that, due to its nature, working capital represented by ageing liquid is similar to invested capital as its growth profile is planned over a long-term horizon. The other inventory increase is mostly a consequence of weaker demand towards the end of year due to Covid-19.

The decrease attributable to the exchange rate component, totalling €61.4 million, was related to receivables from customers for €31.8 million, only partly offset by an increase in payables to suppliers for €13.7 million. The exchange-rate effect on inventories was a negative €43.3 million, of which €26.3 million was due to maturing inventory, which is concentrated in the Americas region (particularly in the United States and Jamaica) and in the United Kingdom.

Lastly, the perimeter effect totalling €29.8 million is largely attributable to the new French acquisitions of Campari France Distribution and Champagne Lallier (for additional information, please see paragraph 'Significant events of the year' in the management report).

At 31 December 2020, operating working capital as a percentage of net sales in the last 12 months was 34.8%, with an overall decrease in the percentage of sales of -2.8% compared with the previous year mainly attributable to the exchange rate effect (which also includes the hyperinflationary effects in Argentina). With particular reference to the perimeter effect, it should be noted that the acquisitions of Campari France Distribution and Champagne Lallier occurred on 28 February and 10 June 2020 respectively, therefore the balance sheet figures at 31 December 2020 included the working capital of the acquired companies while the sales reported in the previous 12 months included the contribution of the brands acquired only for the period from the date on which the transactions were completed. If the statement was adjusted to take account of the full-year consolidation effect of the acquired companies, operating working capital would be reduced to 33.2% of consolidated net sales.

Reclassified statement of cash flows

The table below shows a simplified and reclassified version of the cash flow statement in the consolidated financial statements.

The main classification consists of the representation of the change in net financial debt at the end of the period as the final result of the total cash flow generated (or absorbed). Therefore, the cash flows relating to changes in current and non-current net financial debt, and in investments in marketable securities are not shown.

for the years ending 31 December

EBITDA EBITDA-adjusted

Effects from hyperinflation accounting standard adoption Accruals and other changes from operating activities Goodwill, brand and sold business impairment Income taxes paid

Cash flow from operating activities before changes in working capital Changes in net operating working capital

Cash flow from operating activities Net interests paid

Adjustments to financial income (expenses) Capital expenditure

Free cash flow

(Acquisition) disposal of business Dividend paid out by the Company

Other changes (net purchase of own shares included)

Total cash flow used in other activities

Exchange rate differences and other changes

Change in net financial position due to operating activities

Put option and earn out liability changes(1)

Effect of IFRS 16-'Leases' first application(2)

Increase in investments for lease right of use(3)

Net cash flow of the period=change in net financial position Net financial position at the beginning of the period

Net financial position at the end of the period

2020 € million

of which recurring € million

309.8

2.4 (9.3) 45.7 (119.7)

228.8 43.4 272.2

(25.3)

1.4 (79.8) 168.6

399.9

2.4 (9.3)

- (84.8) 308.1 43.4 351.5

(25.3)

- (64.6) 261.7

(120.6) (62.9) (275.6)

(459.1)

(22.6)

(313.1)

(5.6)

(7.8)

(326.4)

(777.4) (1,103.8)

2019 € million

of which recurring € million

458.1

479.8

4.5 (24.8)

4.5 (17.3)

-(45.3) (81.1)

392.5 385.9

(29.6) (29.6)

363.0 356.3

(27.9) (27.9)

5.8 (82.4) 258.5 110.8 (57.3) (54.3)

- (61.1) 267.3

(0.8)

(13.9) 243.7

(77.6) (81.4) (15.8)

68.9 (846.3) (777.4)

(1) This item includes the full effects of the acquisitions of companies, businesses or strategic assets during the period for a total amount of €4.3 million, which impacted the Group's net financial debt and liquidity flows.
(2) This item, which is a non-cash item, was included purely to reconcile the change in financial debt relating to activities in the period with the overall change in net financial debt.
(3) For information on the value shown, please see note 9 iv-'Lease components' of Campari Group consolidated financial statements at 31 December 2020.

Highlights

In 2020, net cash flow reflected a cash flow absorption of €326.4 million, corresponding to an equivalent increase in net financial debt from 31 December 2019. This result was the combined effect of the slow down in business performances due to Covid-19 outbreak during the year and the significant transactions and payment commitments completed by the Group over the same time horizon, which affected the overall result in term of liquidity absorption.

Cash generation in terms of free cash flow was positive in 2020 and equal to €168.6 million, after non-recurring tax payments due in the year. Cash generation in terms of recurring free cash flow amounted to €261.7 million in 2020, showing a slight decrease in absolute terms compared with the €267.3 million generated in 2019, and an increase as a percentage of adjusted EBITDA (65.4% in 2020 compared with 55.7% in 2019), mainly driven by reduced working capital.

With regards to the other activities, all payment commitments were confirmed and the Group continued to pursue its development objectives in line with its long-term strategy. The overall effect in terms of cash flow absorption was €459.1 million, mainly related to the following: €271.2 million for the purchase of own shares to serve stock option plans (including the liquidation of a number of 7.7 million shares related to the management of the residual shares withdrawal resulting from the transfer of the official seat in the Netherlands, amounting to €64.7 million),

€120.6 million in total for the acquisition of Baron Philippe de Rothschild France Distribution S.A.S., Champagne Lallier S.a.r.l. and interests in Tannico S.p.A., lastly €62.9 million for dividend payment.

Analysis of the consolidated statement of cash flows

The following drivers contributed to the positive generation of free cash flow in 2020:

- EBITDA amounted to €309.8 million. It decreased by €148.3 million compared with 2019 and included a negative effect of €90.1 million related to operating adjustments mainly for restructuring projects and the transfer of the Company registered office to the Netherlands. Excluding these components, EBITDA adjusted amounted to €399.9 million (€479.8 million in 2019);

-non-cash liabilities arising from the application of the accounting standard used to manage hyperinflationaryeffects in Argentina totalling €2.4 million in 2020;

- cash absorption of €9.3 million mainly related to a reduction in payments for indirect taxation and excise
duties;
- impairment losses of €45.7 million, mainly attributable to brand devaluations for Bulldog17, The GlenGrant and Rhum Agricole as well as the write-off of some tangible assets, which are considered as non-cash adjusting components not included in the recurring free cash flow.
- the cash financial impact arising from tax payments made in 2020 amounted to €119.7 million; excluding the
non-recurring tax relief (residual amount based on fiscal year 2019) obtained under Patent box tax regime and the payments due in 2020 in connection with the sale of Villa Les Cèdres, completed in 2019 (for more information about this transaction, please refer to Campari Group 2019 consolidated annual report), taxes paid were €84.8 million, in line with the recurring tax cash out in 2019 (€81.1 million). Some local fiscal
jurisdictions have granted local companies a temporary rescheduling of tax payments to help offset the negative effects on liquidity due to the pandemic situation: Campari Group took advantage of such measures, which enabled the postponement of payments amounting to €2.1 million; this effect was partly offset by the
increase of the tax balance in 2020 due to the positive results achieved in 2019 fiscal year by certain group legal entities in key markets.
- working capital recorded a cash generation of €43.4 million in 2020 (absorption of €29.6 million in 2019) (refer
to paragraph 'Operating working capital' for details);
- net interest paid of €25.3 million in 2020, or €23.8 million after registering €1.4 million of profit related to non-recurring components linked to the liability management transaction on existing debt. Excluding the interest cost on lease totalling €3.2 million, interest paid net of interest received on the net financial position, was
€22.1 million;
- net investment in capital expenditure amounted to €79.8 million, of which the recurring component was €64.6
million (with a slight increase compared with 2019), confirming the Group's commitment to continue enhancing the long-term efficiency of plants, offices and infrastructure despite the difficult macroeconomic context.

Cash flow used in other activities was negative at €459.1 million, compared with a negative value of €0.8 million in 2019. The increase mainly reflects the effect of significant disposals and acquisitions of businesses carried out by the Group in the two years under comparison:

- in 2020 the increase mainly reflects the effect of acquisitions of Baron Philippe de Rothschild France Distribution S.A.S., Champagne Lallier S.a.r.l. and interests in Tannico S.p.A. for a total amount of €120.6 million. The total cash outflow of these deals was €95.4 million, corresponding to the total consideration paid at the closing date to which the net financial debt acquired of €25.2 million must be added. For additional information, refer to the paragraph 'Net financial debt'. In addition, during the year the Group successfully closed an agreement leading to a cash outflow of €4.2 million, to secure a prestige location in Venice for the new opening in 2021 of the Aperol brand house in line with the Group's brand building strategies.

- in 2019, the sale of some non-core real estate attributable mainly to the acquisition of Grand Marnier (€200.0

million gross of the price supplement paid to previous shareholders of the company and tax cash outflow in 2020),

net of the acquisition of Rhumantilles S.A.S., Ancho Reyes and Montelobos (for a total amount of €89.2 million), generated a positive net cash flow totalling €110.8 million.

In addition to the above transactions and despite the uncertain situation caused by pandemic, the Group decided to confirm its commitments in terms of dividend payments of €62.9 million (increased compared with the €57.3 million in 2019) and the purchase of own shares to service stock option plans, totalling €271.2 million (€47.3

million in 2019).

Exchange rate differences and other changes had a negative effect of €22.6 million on the 2020 net cash flow (absorption of €13.9 million in 2019), reflecting the impact of exchange rate differences on, namely, operating working capital, as well as the recognition of some non-cash components, which were included for the purposes of reconciling the changes in cash flow with the change in net financial debt.

The effects of new leases and changes in liabilities for put options and earn out are shown purely for the purposes of reconciling the net cash flow of the year with the total net financial debt. Liabilities for put options and earn out, totalling €5.6 million, were mainly driven by the combined effect of revision of the estimated earn out for

Bulldog, Ancho Reyes and Montelobos (such estimated values being linked to the future performance of the brands), net of the liability deriving from the first consolidation of Champagne Lallier business.

17 Bulldog value determined based on average exchange rate for the period 1 January-31 December 2020, equivalent to €15.8 at the closing exchange rate at 31

December 2020.

Net financial debt

At 31 December 2020, consolidated net financial debt was €1,103.8 million. The increase of €326.4 million on the €777.4 million reported at 31 December 2019 was the combined effect of a positive free cash flow generated by the business of €168.6 million (or €261.7 million on a recurring basis), more than offset by payment commitments for an overall amount of €459.1 million, including acquisitions, share buyback and dividends, as well as other negative changes for €36.0 million.

During 2020, the Group's financial structure was solid and stable overall, despite the challenging macroeconomic environment and the effects of the pandemic which resulted in a reduced, though yet very satisfactory, cash flow generation. Against this volatile backdrop, Campari Group successfully issued an unrated 7-year Eurobond, targeted at institutional investors and listed on Luxembourg Stock Exchange (with a dual listing on the ExtraMOT

PRO segment of the Italian Stock Exchange), for a total offering of €550 million. The proceeds from this issue were used to refinance the Group's existing indebtedness (for more information please refer to paragraph

'Significant events of the year'): reference is made to the Eurobond issued in 2015, expired in September 2020 for a residual nominal amount of €580.9 million. With its extremely sound and flexible financial profile, during the year the Group has been able to meet all existing financial commitments and confirm the continuation of the share buyback programme for the year ending 31 December 2020, thanks to the significant amount of available cash and cash equivalents, which totalled €548.1 million at 31 December 2020. At the same time, the credit lines intended for general corporate purposes in line with the Group's strategy (totalling €631.6 million) were only

partially drawn down for €31.5 million (recognized in the financial debt, as set out in the summary table below).

More specifically, the consolidated net financial debt at 31 December 2020 reflected the cash effects of the main payment commitments for a total amount of €394.2 million, which included the net cash outflow for the purchase of own shares to service stock option plans of €271.2 million (which included €64.7 million for the buyback of withdrawn shares in the context of the Redomiciliation), the dividend of €62.9 million distributed in April 2020 and

the non-recurring outflow of €60.1 million of taxes due under the tax regulations applying to the disposal of the real estate asset Villa Les Cèdres in France, which was completed in 2019 (for more information about this transaction, please refer to the Campari Group 2019 annual report). Moreover, during the year, and notwithstanding the pandemic, the Group confirmed the strong commitment to its long-term external growth objectives by completing the acquisitions of Baron Philippe de Rothschild France Distribution S.A.S., Champagne

Lallier S.a.r.l., in addition to the acquisition of interests in Tannico S.p.A., for an overall impact of €125.0 million,

as set out below.

Tannico S.p.A.

€ millionChampagne Lallier € million

Baron Philippe de Rothschild France Distribution S.A.S.(1)

€ milliontotal € millioninterests' acquisition in business or investments

(23.8)

(21.3)

(50.3) (95.4)
(including post-closing adjustments)
net financial assets (debt) acquired total acquisition cash effect on closing date payables for put option and earn out
- (23.8)
(20.9)
(4.3) (25.2)

(42.2)

(54.6)

(120.6)

Net effect of (acquisitions) disposals on net financial debt

- (23.8)

(4.3)

(46.5)

- (54.6)

(4.3)

(125.0)

of which stated at 31 December 2020: net impact on cash and cash equivalent net impact on net financial debt other than cash and cash equivalent

(23.8)

(18.5)

(49.8) (92.1)
-
(28.1)
(4.9) (32.9)

(1) Baron Philippe de Rothschild France Distribution S.A.S. ('RFD'), now named Campari France Distribution S.A.S..

Changes in the debt structure in the two periods under comparison are shown in the table below.

At 31 December

of which

cash and cash equivalents bonds loans due to banks lease payables lease receivables other financial assets and liabilities short-term net financial debt bonds loans due to banks ⁽¹⁾ lease payables lease receivables other financial assets and liabilities medium-/long-term net financial debt net financial debt before put option and earn out payments liabilities for put option and earn-out payments net financial debt

2020 € million

2019 € million

total change € million

548.1

(244.3)

(13.9)

(13.3) 276.6

704.4 (580.0)

(156.4)

580.0

(31.0) (213.3)

(15.4) 1.5

2.3 (2.3)

(8.9) (4.4)

71.5 205.2

(894.7)

(349.4) (545.3)

(249.3) (70.7)

(82.1) 12.6

4.8 (4.8)

9.8 (2.8)

(666.1)

(611.0)

(320.0) (69.5)

- 7.1

(1,277.1)

(1,000.5)

(594.6)

(405.8)

(103.3)

(1,103.8)

(182.8)

79.5

(777.4) (326.4)

organic € millionperimeter⁽²⁾

€ milliondue to exchange rates € million

(18.1)

(95.9)

(42.4)

580.0

(195.2)

(20.8) 2.7

0.5

0.1 0.9

(2.2)

- (0.0)

(3.5) 361.4

(0.9) (0.0)

(117.4) (38.8)

(545.3) (70.7)

- -- -

12.0

(4.4) 5.1

(4.6) - (0.3)

(1.9) - (0.9)

(610.5)

(4.4) 3.9

(249.1)

(121.9) (34.9)

82.4

(4.3) 1.4

(166.7)

(126.2) (33.5)

(1) Including the relevant derivatives.
(2) The change includes an overall marginal impact of €1.2 million, related to the exit from the consolidation area of the Japanese Group's commercial company operating in the Japanese market following on-going changes in the distribution structure. The main items of net financial position were €3.8 million of cash and cash equivalents, €0.1 million in lease payables, €2.2 million in other current financial liabilities, €0.3 long term lease payables.

In terms of structure, the net financial debt at 31 December 2020 showed a positive net financial position in the short-term, which left the Group's financial obligations embedded in the medium and long term profile. The management of liabilities in 2020, achieved thanks to the solid reputation of the Group, not only guaranteed the satisfaction of maturing obligations, but also confirmed the Group's commitment to pursue a long-term strategy.

The short-term net financial position, mainly composed by cash and cash equivalents (€548.1 million), net of payables to banks (€244.3 million), was a positive €276.6 million, showing an increase of €205.2 million compared with the previous year. This change included an increase in bank payables of €213.3 million, mainly driven by new term debt facilities and uncommitted credit lines drawn down for general business purposes. The reimbursement of the Eurobond issued in 2015 and expired in September 2020 (therefore classified under short term liabilities), contributed to a positive variation of €580.0 million in the short-term financial position at 31 December 2020. The short-term financial position was related to figurative lease components and comprised €13.9 million payables only, with the lease receivables (€2.3 million at the end of previous year) having been settled during 2020. Other financial payables and receivables mainly relate to payables for interest normally accrued on existing bonds (€6.3 million) and other financial payables related to the new acquired companies, net of financial receivables connected with the sale of non-core business realized in previous years.

The medium/long-term exposure comprised bonds in the amount of €894.7 million, including the above mentioned newly subscribed unrated 7-year Eurobond of €550.0 million. Loans due to banks totalled €320.0 million, showing an increase of €70.7 million compared with 31 December 2019 driven by the subscription of new term debt facility agreements.

Figurative payables relating to long-term leases, of €69.5 million, were also recorded. The medium/long-term financial receivables item of €4.8 million in 2019 was settled in advance during the year. Lastly, medium to long- term net financial debt included other financial payables and receivables for a net amount of €7.1 million, mainly relating to receivables connected with the sale of non-core business (€3.0 million) and restricted deposits supporting future payments associated with past business acquisitions (€3.0 million).

Separately, the Group's net financial debt showed a liability of €103.3 million, consisting of future commitments to purchase outstanding minority shareholdings in controlled companies, and in particular in Société des Produits

Marnier Lapostolle S.A. (for a cash outflow of €50.9 million), Montelobos, Ancho Reyes, J. Wray&Nephew Ltd. and the newly acquired Champagne Lallier S.a.r.l. (for an estimated combined cash outflow of €50.8 million) and other committed liabilities connected.

The Group's debt management objectives are based on the achievement of an optimal and sustainable level of financial solidity, while maintaining an appropriate level of flexibility with regards to acquisition opportunities and funding options, through available cash. The Group monitors the evolution in the net debt/adjusted EBITDA ratio on an ongoing basis. For the purposes of the ratio calculation, the net debt is the value of the Group's net financial position at 31 December 2020, whereas the consolidated adjusted EBITDA is that of the last 12 months. At 31 December 2020, this multiple was 2.8 times, compared with 1.6 times at 31 December 2019, based on consistent calculation criteria. The increase is the combined effect of the significant cash outflow incurred by Campari Group as a result of the transactions completed in 2020 and the temporary negative impact of Covid-19 on EBITDA

adjusted, as set out above.

Capital expenditure

In 2020, net investments totalled €79.8 million, of which €64.6 million were recurring and €15.1 million were non-recurring.

Recurring investments related to initiatives aimed at continually enhancing the production efficiency of the Group's industrial plants, offices and infrastructure. Specifically, they related to the following projects:

• maintenance expenditure on Group's operations and production facilities, offices and IT infrastructure which, although not material on an individual basis, amounted to €48.3 million in total;
• the purchase of barrels for maturing bourbon and rum totalling €12.4 million, net of related disposals;
• investments to develop biological assets, totalling €3.9 million.

Non-recurring investments, totalling €15.1 million, related to initiatives such as the opening of new offices, activities aimed at creating and strengthening new brand houses, structures and product innovation projects.

With regard to the type of investment, the net purchases comprised tangible assets of €65.3 million and intangible assets of €14.5 million.

Lastly, the investments for rights of use of third-party assets were related to tangible assets at 31 December 2020. The increase during the year amounted to €7.8 million and was attributable to offices, plant and machinery and vehicles.

Reclassified statement of financial position

The Group's financial position is shown in the table below in summary and in reclassified format, to highlight the structure of invested capital and financing sources.

At 31 December

of which

fixed assets other non-current assets (liabilities) operating working capital other current assets (liabilities) total invested capital

Group shareholders' equity non-controlling interests net financial debt total financing sources

2020 € million

2019⁽¹⁾

€ milliontotal change € million

2,944.6 (369.2)

617.4

(90.6) 3,102.2

3,062.4 (117.8)

(441.6) 72.5

692.3 (74.9)

(147.2) 56.6

3,165.9 (63.7)

1,996.6

1.8 1,103.8 3,102.2

2,386.6 (389.9)

1.9 (0.2)

777.4 326.4

3,165.9 (63.7)

organic change € millionperimeter € million

exchange rates and hyperinflation € million

(38.7)

96.1 (175.2)

47.6 (43.4)

(0.6) 25.5

29.8 (61.4)

45.1

0.9 10.6

10.5

126.2 (200.5)

(159.4) - (230.5)

(0.2) 170.1 10.5

- 126.2 126.2

- 30.1

(200.5)

(1) For information on reclassifications of comparative figures, refer to note 3 xi-'Reclassification of comparative figures at 31 December 2019' of Campari Group consolidated financial statements at 31 December 2020.

Invested capital at 31 December 2020 was €3,102.2 million, €63.7 million lower than the restated figures at 31

December 2019.

Focusing on the organic change, the most significant events attributable to the invested capital were referred to the increase of €47.6 million in other non-current assets (net of liabilities) and €45.1 million in other current assets (net of liabilities), mainly attributable to :

- a reduction in other current liabilities as a consequence of significant tax payments made in 2020, out of which €60.1 million is related to tax payments due in 2020 in accordance with the timing provided for by the applicable tax legislation and deriving from the disposal of Villa Les Cèdres completed in 2019;
- a net reduction in deferred tax liabilities related, for €29.9 million, to a positive reversal to the profit or loss of deferred tax liabilities resulting from the step-up of certain brand and goodwill values relevant for amortization tax purposes, to their corresponding book values as stated in the Company's separate accounts. This benefit is granted to companies pursuant to Italian Law Decree no. 104/2020, enacted in August 2020 and converted with amendments into Law no.126/2020 in October 2020.

These increases have been mostly offset by a reduction of €43.4 million in working capital (see the paragraph

'Operating working capital' in this management report for more information) and fixed assets of €38.7 million.

The acquisitions of interests in Tannico and the effect of the consolidation of the values resulting from the recently acquired Baron Philippe de Rothschild France Distribution and Champagne Lallier S.a.r.l. were only marginallyoffset by the deconsolidation of the Group's commercial company in Japan, following a change in the local distribution structure (for additional information in relation to the acquisition transactions, refer to the paragraph 'Significant events of the year'). The change attributable to the external growth led to an increase across all invested capital items as follows:

- fixed assets of €96.1 million, of which brand and goodwill accounted for €59.9 million and associates for €23.8
million;
- non-current liabilities (net of other non-current assets) of -€0.6 million;
- operating working capital of €29.8 million;
- other current liabilities (net of other current assets) of €0.9 million;
- net financial debt of €126.2 million (see paragraph 'Net financial debt' for more information).

The invested capital at 31 December 2020 was finally significantly impacted by non-monetary foreign currency translation effects, resulting in a reduction of €200.5 million.

Regarding financing sources, the main changes relate to a decrease of €389.9 million in shareholders' equity, mostly due to translation differences on net assets held in currencies other than the Euro and the dividend paid by the Company. For additional information on the change in the net financial debt, totalling €326.4 million, refer to the paragraph 'Net financial debt' of this management report.

As a result of the changes mentioned above, the Group's financial structure showed a net debt to shareholders'

funds ratio of 55.2% at the end of the period, showing an increase compared with the 32.6% recorded at 31 December 2019 (on a restated basis).

Reconciliation of the Company and Group net profit and shareholders' equity

For information related to the reconciliation between the result for the period and shareholders' equity for the

Group with the same items of the Parent Company Davide Campari-Milano N.V., please refer to paragraph

'Shareholders' equity' in the Company only financial statement at 31 December 2020.

Full year 2020 conclusion and outlook

The year 2020 confirmed its absolute peculiarity characterized by the Covid-19 ('Coronavirus') pandemic, which is heavily marking world history. Despite Campari Group's full year performance was ultimately impacted in this

very challenging and volatile year, thanks to its agility and the strength of its brands and business model, Campari Group delivered very satisfactory results overall whilst meeting all its financial commitments and continuing to pursue its long-term growth strategy via acquisitions.

Full year 2020 performance showed strong business resilience and brand momentum in key off-premise brand-market combinations, as supported by sustained consumption trends.

The significant impact of the unexpected pandemic had consequences on people lifestyles which are likely to persist for many years, even after the defeat of the virus.

Looking into 2021 and beyond, the Group remains confident about the long-term consumption trends and growth opportunities. Its brands remain resilient and very healthy with strong consumer pull. Concomitantly, the Group remains cautious due to the short-term uncertainty related to the on-going restrictions and the vaccine roll-out affecting on-premise channel across all geographies as well as Global Travel Retail. Home consumption is expected to remain sustained, fuelled by continuous marketing investments, driving the performance in particular in key off-premise markets. With destocking activities completed in the US market, the shipments are expected to progressively align with consumption trends in this particular market.

As a committed and long-term brand builder, Campari Group will continue to leverage the digital and on-line investments, alongside a dynamic omni-channel approach, with a particular focus on e-commerce, rapidly adapting to the 'new-normal' environment.

Moreover, for 2021, perimeter and exchange rate effect are expected to negatively impact the Group's EBIT adjusted by approximately €9 million (mainly due to the termination of agency brands) and €13 million (driven by

weak US Dollar as well as emerging market currencies18) respectively.

Overall as a global player, the Group will remain focused in strengthening its iconic brands ensuring they are strongly positioned and ready to accelerate their growth on the back of consistent investments in new opportunities offered by consumption trends. The Group remains firmly convinced that the out of home social experience and conviviality will remain essential to consumers lifestyles in the future.

Looking forward, the Group remains cautiously confident in the short-term and optimistic about the long-term business momentum.

18 Based on an estimated average rate of €/US Dollar of 1.21 in full year 2021.

Definitions and reconciliation of the Alternative Performance Measures (APMs or non-GAAP measures) to GAAP measures

These financial statements present and comment on certain financial performance measures that are not defined in the IFRS (non-GAAP measures).

These measures, which are described below, are used to analyse the Group's business performance in the 'Key Highlights' and 'Report on operations' sections and comply with the Guidelines on Alternative Performance Measures issued by the European Securities and Markets Authority ('ESMA') in its communication ESMA/2015/1415.

The alternative performance measures listed below should be used to supplement the information required under IFRS to help readers of annual financial statements to gain a better understanding of the Group's economic, financial and capital position. They are applied to Group planning and reporting, and some are used for incentive purposes.

Alternative performance measures can serve to facilitate comparison with groups operating in the same sector, although, in some cases, the calculation method may differ from those used by other companies. They should be viewed as complementary to, and not replacements for, the comparable GAAP measures and movements they reflect.

FINANCIAL MEASURES USED TO MEASURE GROUP OPERATING PERFORMANCE

Organic change: the Group shows organic changes to comment on its underlying business performance. By using this measure, it is possible to focus on the business performance common to both periods under comparison and which management can influence. Organic change is calculated by excluding both the impact of currency movement against the Euro (expressed at average exchange rates for the same period in the previous year) and the effects of business acquisitions and disposals, as well as the signing or termination of distribution agreements. In order to mitigate the effect of hyperinflationary economies, organic change for counties having to adopt the hyperinflationary methodology laid down in IFRS only includes the component attributable to volumes sold in relation to net sales, while the effects associated with hyperinflation, including price index variation and price increases, are treated as exchange rate effects.

Specifically:

- the exchange rate effects are calculated by converting the figures for the current period at the exchange rates applicable in the comparative period of the previous year. The exchange rate includes the effects associated with hyperinflation economies;
- the results attributable to businesses acquired or the conclusion of distribution agreements during the current year are excluded from organic change for 12 months from the date on which the transaction is closed;
- the results attributable to businesses acquired or the conclusion of distribution agreements during the previous year are included in full in the figures for the previous year as from the closing date of the transaction, and are only included in the current period's organic change 12 months after their conclusion;
- the results from business disposals or the termination of distribution agreements during the previous year are wholly excluded from the figures for that year and, therefore, from organic change;
- the results from business disposals or the termination of distribution agreements during the current year are excluded from the figures for the previous year from their corresponding date of disposal or termination.

The percentage organic change is the ratio of the absolute value of the organic change, calculated as described above, to the absolute value of the measure in question for the previous period under comparison.

Gross profit: calculated as the difference between net sales and the cost of sales (consisting of their materials, production and distribution costs components).

Contribution margin: calculated as the difference between net sales, the cost of sales (consisting of their materials, production and distribution cost components) and advertising and promotional costs.

Other operating income (expenses): relate to certain transactions or events identified by the Group as adjustment components for the operating result, such as:

- capital gains (losses) on the disposal of tangible and intangible assets;
- capital gains (losses) on the disposal of businesses;
- penalties arising from the settlement of tax disputes;
- impairment losses on fixed assets;
- restructuring and reorganization costs;
- ancillary expenses associated with acquisitions/disposals of businesses or companies;
- other non-recurring income (expenses).

These items are deducted from, or added to, the following measures: operating result, EBITDA, profit before taxation and Group's net profit for the period. For a detailed reconciliation of the items that had an impact on the alternative performance measures referred to above in the current and comparison years, see the appendix given at the end of this section.

The Group believes that properly adjusted measures help both management and investors to assess the Group's results and cash flows against those of other groups in the sector, as they exclude the impact of certain items that are not relevant for assessing performance.

Operating result (EBIT): calculated as the difference between net sales, the cost of sales (in terms of their materials, production and distribution), advertising and promotional costs, and selling, general and administrative expenses.

Result from recurring activities (EBIT adjusted): the operating result for the period before the other operating income (expenses) mentioned above.

EBITDA: the operating result before depreciation and amortization of intangible and tangible fixed assets and leased assets.

EBITDA-adjusted: EBITDA as defined above, excluding the other operating income (expenses).

Adjustments to financial income (expenses): certain transactions or events identified by the Group as components adjusting the profit before taxation related to events covering a single period or financial year, such as:

- expenses related to the early settlement of financial liabilities or liability management operations;
- financial expenses arising from acquisitions/disposals of businesses or companies;
- other non-recurring financial income (expenses).

Put option, earn out income (expenses): relates to the income (expenses) associated with the review of estimates and assessment of expected cash out settlement for put option and earn out, including the non-cash effect as well, arising from the related actualization.

Profit before taxation-adjusted: the profit or loss for the period before taxation, before other operating income (expenses) and adjustments to financial income (expenses), before the put option earn out income (expenses) referred to above and before non-controlling interests result before taxation.

Tax adjustments: include the tax effects of transactions or events identified by the Group as components adjusting the taxation of the period related to events covering a single period or financial year, such as:

- positive/(negative) taxation effects associated with the operating and financial adjustments, as well as the put option earn out income (expenses) described above;
- non-recurring positive/(negative) taxation effects.

Cash tax rate

The cash tax rate is calculated by deducting form the taxation the tax adjustments above mentioned and the deferred taxes on brands and goodwill which are relevant for tax purposes. The new value of cash taxation is than related on the pre-tax result adjusted.

Group's net profit adjusted: the result for the period attributable to the Group before other operating income (expenses), adjustments to financial income (expenses) and the put option earn out income (expenses) referred to above, before the related taxation effect and before other positive/negative tax adjustments for the period.

Basic and diluted earnings per share adjusted (basic/diluted EPS adjusted): basic/diluted earnings per share (EPS) before other operating income (expenses), adjustments to financial income (expenses) and the put option earn out income (expenses) referred to above, before the related taxation effect and before other positive/negative tax adjustments for the period.

ROS (return on sales): the ratio of the operating result to net sales for the period.

ROS-adjusted: the ratio of the result from recurring activities (EBIT adjusted) to net sales for the period.

ROI (return on investment): the ratio of the operating result for the period to fixed assets at the end of the period (see the definition of fixed assets below).

ROI-adjusted: the ratio of the result from recurring activities for the period (EBIT adjusted) to fixed assets at the end of the period (see the definition of fixed assets below).

• Reclassified statement of financial position

The items included in the reclassified statement of financial position are defined below as the algebraic sum of specific items contained in the financial statements:

Fixed assets: calculated as the algebraic sum of:

- property, plant and equipment;
- right-of-use assets;
- biological assets;
- investment property;
- goodwill;
- brands;
- intangible assets with a finite life;
- investments in associates and joint ventures.

Other non-current assets and liabilities: calculated as the algebraic sum of:

- other non-current assets;
- deferred tax assets;
- other non-current financial asset;

- deferred tax liabilities;
- post-employment benefit obligations;
- provisions for risks and charges;
- other non-current liabilities;
- other non-current financial liabilities.

Operating working capital: calculated as the algebraic sum of:

- inventories;
- biological asset inventories;
- trade receivables;
- trade payables;

Other current assets and liabilities: calculated as the algebraic sum of:

- income tax receivables;
- other current assets;
- income tax payables;
- other current liabilities;
- other current financial assets;
- other current financial liabilities;
- assets and liabilities held for sales.

Invested capital: calculated as the algebraic sum of the items listed above and in particular:

- fixed assets;
- other non-current assets and liabilities;
- operating working capital;
- other current assets and liabilities.

Net financial debt

Net financial debt is calculated as the algebraic sum of:

- cash and cash equivalents;
- other non-current financial asset and liabilities;
- other current financial assets and liabilities;
- lease receivables;
- lease payables;
- bonds;
- loans due to banks;
- liabilities for put option and earn-out payments.

Capital expenditure

This item includes the cash flow from the purchase of intangible and tangible fixed assets net of disposals made during the period.

Recurring capital expenditure

This item shows the net cash flows from purchases/disposals relating to projects managed in the ordinary course of business.

Reclassified statement of cash flows

This item shows the cash flows generation excluding cash flows relating to changes in short-term and long-term debt, and in investments in marketable securities. The total cash flows generated (or used) in the period thus corresponds to the change in net financial debt.

Recurring free cash flows: cash flows that measures the Group's self-financing capacity, calculated on the basis of cash flows from operations, before the other operating income and expenses referred to above, and adjusted for interest, net direct taxes paid and cash flows used in capital expenditure attributable to ordinary business before the income/losses component arising from the sale of fixed assets.

Recurring provisions and operating changes: these include provisions and operating changes, excluding the other operating income and expenses referred to above.

Recurring taxes paid: these include taxes paid, excluding cash flows from tax incentives and from disposal of the Group's non-strategic assets.

Free cash flows: cash flows that measures the Group's self-financing capacity calculated on the basis of cash flows from operations, net of interests, direct taxes paid, and cash flows used in capital expenditure, excluding income from the sale of fixed assets.

Debt/ EBITDA-adjusted ratio

The net debt/ EBITDA-adjusted ratio is used by management to assess the Group's level of financial leverage, which affects its capacity to refinance its debt by the set maturity dates and to obtain further financing to invest in new business opportunities.

The Group monitors changes in this measure on an ongoing basis. Net debt is the Group's net financial debt reported at the closing date of the reference period; the Group's EBITDA-adjusted for the past 12 months is calculated based on the reported value at the closing date of the reference period, into which the portion of adjusted EBITDA recorded in the previous year is incorporated for the remaining months.

• Appendix of alternative performance indicators

In 2020, EBITDA, the result from recurring activities (EBIT), profit or loss before taxation and Group net profit were adjusted to take into account the items shown in the table below.

for the year ending 31 December 2020	EBITDA	EBIT	profit before taxation	Group net profit	basic earnings per share	diluted earnings per share
€ million	% on sales	€ million	% on sales	€ million	% on sales	€ million	% on sales	€	€
alternative performance measure reported	309.8	17.5%	231.8	13.1%	209.6	11.8%	187.9	10.6%	0.17	0.16

(35.4) (21.4)

impairment on goodwill and trademarks restructuring and reorganisation costs fees from acquisition/disposals of business or companies other adjustments of operating income (expenses)

income (expenses) related remeasurement of put option and earn out adjustments to financial income (expenses) tax adjustments

-2.0% -1.2% -0.1% -1.7%

(35.4) (21.4)

-2.0% -1.2% -0.1% -1.7%

(35.4) (21.4)

-2.0% -1.2% -0.1%

(35.4) (21.4)

-2.0% -1.2% -0.1%

(0.03) (0.03)
(0.02) (0.02)

(2.6)

(30.7)

-1.7%

(30.7)

-1.7% (0.03)

(0.03)

19.4 1.4

1.1% 0.1%

19.4

1.1% 0.1% 3.1%

0.02

1.4 55.1

- 0.05

total adjustments	(90.1)	-5.1%	(90.1)	-5.1%	(69.3)	-3.9%	(14.2)	-0.8%	(0.01)	(0.01)
alternative performance measure adjusted	399.9	22.6%	321.9	18.2%	278.9	15.7%	202.1	11.4%	0.18	0.17

for the year ending 31 December 2020

basic

diluted

€ million n.

Group net profit adjusted outstanding shares

202.1 1,133,816,568

202.1 1,156,253,726

earnings per share adjusted

€

0.18

0.17

for the year ending 31 December € million profit before tax before minorities total taxation

2020

reported

adjustments

209.6 (69.3)

(22.7) 55.1

tax benefit from Italian Legislative Decree n.104/2020 29.9

tax adjustments 2.2

tax effect on operating and financial adjustments 23.0

adjusted

278.9 (77.9)

net profit for the period tax rate (nominal and adjusted)

186.9 -10.8%

(14.2)

201.1 -27.9%

deferred taxes on goodwill and brands

(13.1)

cash tax rate

-23.2%

for the year ending 31 December 2020	Free cash flow
€ million
alternative performance measure reported	168.6

accruals and other changes from operating activities goodwill, brand and sold business impairment non-recurring taxes paid adjustments to financial income (expenses) net cash flow from non-recurring investments

168.6

(90.1)

45.7

(34.9)

1.4

(15.2)

total adjustments	(93.1)
alternative performance measure adjusted (recurring free cash flow)	261.7

(93.1) 261.7

for the year ending 31 December 2019

alternative performance indicator reported gains (losses) from disposals of tangible and intangible fixed assets devaluation of tangible assets, goodwill, trademarks and business disposed fees from acquisition/disposals of business or companies restructuring and reorganisation costs other adjustments of operating income (expenses)

adjustments to financial income (expenses) fiscal effects of Patent Box other fiscal adjustments total adjustments alternative performance indicator-adjusted

EBITDA

EBIT

profit before taxes

Group net profitbasic earnings per sharediluted earnings per share

€ million

% on sales

€ million

% on sales

€ million

% on sales

€ million

% on sales

€

458.1

24.9%

386.3

21.0%

354.6

19.2%

308.4

16.7%

0.27

€ 0.26

2.2

0.1% -0.4% -0.1% -0.6% -0.3%

2.2

0.1% -0.4% -0.1% -0.6% -0.3%

2.2

0.1% -0.4% -0.1% -0.6% -0.3% 0.3%

2.2

0.1%

(6.6)

-0.4% (0.01)
(1.3) (10.2)
(1.3) (10.2)
(1.3) (10.2)
(1.3) (10.2)
-0.1%
-
-0.6% (0.01)

(5.8)

(0.01)

- (0.01)

(5.8)

5.8

(5.8)

5.8 25.4 31.4

-0.3% 0.3% 1.4% 1.7%

- 0.01

- -0.02 0.02

0.03 0.03

(21.7) 479.8

-1.2% 26.0%

(21.7) 408.0

-1.2% 22.1%

(15.8) 370.4

-0.9% 20.1%

41.0 267.4

2.2% 14.5%

0.01 0.01

0.23 0.23

for the year ending 31 December 2019 Group net profit-adjusted outstanding shares earnings per share-adjusted

€ million n.

€

basic

diluted

267.4 1,144,315,926 0.23

267.4 1,169,855,022 0.23

for the year ending 31 December 2019 € million profit before tax before minorities total taxation

reported

2019 adjustments

354.6 (15.8)

(46.2) 56.8 (103.1)

Patent Box 25.4 tax adjustments 26.0 tax effect on operating and financial adjustments 5.4

net profit for the period tax rate (nominal and adjusted)

deferred taxes on goodwill and trademarks

308.4 41.0 267.4

-13.0%

adjusted

370.4

- -27.8%

(15.8) (15.8)

cash tax rate -23.5%

for the year ending 31 December 2019

Free cash flow € million

alternative performance measure reported 258.5

accruals and other changes from operating activities (29.1)

non-recurring taxes paid 35.8

adjustments to financial income (expenses) 5.8

net cash flow from non-recurring investments (21.3)

total adjustments (8.8)

alternative performance measure-adjusted (recurring free cash flow ) 267.3

Investor information

The global economy

The Covid-19 pandemic has caused havoc on the global economy since the first quarter of the year, resulting in a generalized marked decline coinciding with the lockdown in the spring and winter seasons. It was only during the summer season that economic activities partially recovered thanks to the easing of restrictions in many countries worldwide.

Despite the positive news about vaccine development in the last quarter of the year, the economic outlook is still subject to uncertainty about the course of the pandemic, with infection rates still high at the end of 2020 and beginning of 2021 across all countries, and as regards to the possible repercussions on the behaviour of households and firms19.

Despite the extreme complexity of quantification, the impact of Covid-19 on world growth is expected to be very significant. The latest estimates released in October by the International Monetary Fund (IMF) point to a fall in world GDP of -4.4% in 2020. Despite a positive third quarter, the contraction will also be very pronounced in advanced economies given the more extensive and stringent measures put in place to contain the pandemic. Nevertheless, a general recovery is expected to lead to a +5.2% increase in global GDP in 202120.

Regarding the Group's largest market, the United States, its GDP is expected to decline by -4.3% in 2020 (with a strong improvement as compared with the -8.0% estimate published in the April release by the IMF) and grow by +3.1% in 2021. The US Presidential elections held in November led to the victory of the Democrats, followed by months of uncertainty given that a proportion of Republicans did not, at first, recognize the electoral results as being legitimate. A number of fiscal stimulus packages were approved in order to support the disposable income during the year.

With reference to Italy, the Group's second largest market, the spread of the virus has significantly impacted the country's economic activity since the end of February, pausing only during the summer season thanks to the easing of restrictions as well as the effects of monetary and fiscal measures to stimulate demand. The GDP estimates released by the IMF for 2020 point to a very strong overall decline of -10.6%, which is not expected to be fully recovered in the years to come (+5.2% in 2021 and +2.6% in 2022).

With reference to the Group's other key markets, in Europe, GDP in Germany is expected to drop by -6.0% in 2020, with a recovery estimated to be equal to 4.2% in 2021. In France, one of the countries most impacted by the pandemic in continental Europe, GDP growth for 2020 is expected to decrease by -9.8%, with a partial recovery in 2021 (+6.0%). The United Kingdom signed the final trade deal with the European Union at the end of the year and GDP for that country is expected to decline by -9.8% in 2020, with a partial recovery in 2021 (+5.9%). Elsewhere, Australia, the leading market for the Group in the Asia-Pacific area, is expected to register a downturn of-4.2% in 2020. The main emerging markets for the Group, such as Russia and Brazil, are expected to see a downturn in their economic activity estimated at -4.1% and -5.8% in 2020, while China, the first country impacted by the pandemic, is likely to post slight growth in 2020 (+1.9%), well below its historical GDP growth rate (above 6% in the past two years)2.

Besides the pandemic, the evolution of trade wars among the major global economies, with higher tariffs on certain import products, remain among the short-to-medium-term risks to be monitored as well.

Spirits sector

The Covid-19 pandemic has severely impacted sectors such as dining, catering, entertainment and hospitality services. Given its natural exposure to consumption in the on-premise channel, mainly represented by bars and restaurants, the spirits sector has been greatly affected as well. In many areas of the world, and in particular Europe, governments have introduced strong restrictions aimed at containing and slowing down the spread of the different waves of the virus by limiting social contacts and moments of conviviality, leading to a significant drop in on-premise activities throughout the year, notably in the spring and winter seasons. The Global Travel Retail channel was severely affected as well, given the widespread reduction in travel.

While the on-premise channel has suffered significantly due to the lockdown and social distancing measures, home consumption has proved to be much more resilient, showing growth in many markets during the pandemic period, particularly in countries such as the United States, Germany, the United Kingdom, and Australia that are over-indexed to the off-premise channel. Compared with the financial crisis in 2008, the shift from on-premise to

19 Bank of Italy.
20 International Monetary Fund.

off-premise during the pandemic period is as being more a consequence of regulations as opposed to being driven by a lack of disposable income. This being the case, the favourable sell-out trends in the off-premise channel across many markets during the lockdowns show that the main target consumers for premium spirits (who benefit from substantially unchanged budgets, as their disposable income has not been affected by the Covid-19 crisis) have continued to opt for the same, or even higher premium, products that they typically consumed in on-premise venues when shopping for home consumption. New at-home consumption moments have emerged, as well as new socialization concepts, such as virtual aperitifs. These trends are also supported by the development of digital technology, coupled with increased brand-building investments and a focus on digital initiatives by brand owners that are aimed at re-creating the out-of-home consumption experience and engaging with at-home consumption.

Nevertheless, uncertainty remains as regards to the timing of the consumption recovery in the on-premise channel, as well as the likelihood of a large number of on-premise accounts not being able to reopen due to liquidity crises.

Another relevant phenomenon seen during the spring lockdowns and further confirmed throughout the year is the boom in the e-commerce channel and in online sales in general. Before the virus outbreak, the development of the e-commerce channel was already seen as being an important emerging trend, particularly in China, the United States and the United Kingdom, although mostly for the wine category (in particular sparkling wine and champagne). Since the pandemic, this channel has gained additional traction among consumers, especially as compared with more traditional channels, and has now become relevant also for the spirits sector. Several spirits players have collaborated directly with existing e-commerce operators or have developed their own e-commerce platforms.

Financial markets

The financial markets have seen strong turbulence and volatility during the year. Equity prices were initially pushed downwards heavily and then saw a strong global rally that led to wide swings in government bond yields, against a backdrop of reduced liquidity, increased risk aversion and high volatility. The fiscal stimulus announced by many governments, as well as the positive development of the vaccine against the Covid-19, led to a positive last quarter of the year across most of the global equity markets21.

During 2020, the FTSE MIB and FTSE Italia All-Share indices declined by -5.4% and -5.6% respectively. In Europe, the MSCI Europe registered a negative performance of -7.3%, while in the United States, the S&P 500 index grew by +16.3% overall, after a decline of -4.0% during the first half of the year. The difference is partly explained by the overperformance of technology stocks throughout the year, these stocks being overrepresented in the S&P 500 when compared to the European indexes, as well as a more resilient view of the US economy.

Regarding exchange rate fluctuation in 2020, almost all the main currencies of the Group depreciated against the Euro, including the US dollar (-1.9%), Canadian dollar (-2.9%), the Jamaican dollar (-8.2%), the Australian dollar (-2.7%) and the British pound (-1.3%).

Performance of the Campari stock

In the economic, industry and financial market environment described above, the Campari stock price performance was strongly impacted throughout the year, starting from the last week of February and recovering to pre-pandemic levels in September.

During 2020, the Campari stock price grew overall by +14.7% (after a strong decline during the first half of the year) in absolute terms, with total shareholder return (TSR) up +15.7%. The Campari stock price outperformed the FTSE MIB by +20.2%, the STOXX Europe 600 Food&Beverage index by +22.3% and the MSCI Europe sector index by +22.0%22 in the period from 1 January to 31 December 2020.

The minimum and maximum closing prices of €5.535 and €9.850 (all-time high since the initial public offering

(IPO) in 2020 were recorded on 17 March 2020 and 11 November 2020 respectively. An average of 2.6 million

Campari shares were traded daily in 2020, with an average daily value of €20.4 million. At 31 December 2020, Campari's market capitalisation was €10.8 billion with a closing share price of €9.34.

From the date of the IPO until 31 December 2020, the Campari stock price was, in absolute terms, 12.1 times higher, or up 1,105.2% (an average of 13.6% per year), with total shareholder return (TSR)23 15.9 times higher, or 1,487.0% (an average of 15.2% per year), outperforming most of its industry peers.

21 Bank of Italy
22 Bloomberg
23 Dividend reinvested

Performance of the Campari stock and the main benchmark indices from 1 January 2020 to 31 January 2021

Camparistockprice(Euro)

80.0

70.0

60.0

50.0

40.0

30.0

Equityturnover(€million)

20.0

10.0

0.0

Campari (equity turnover € million)

Campari (stock price)FTSEMIB Index (rebased)STOXX Europe 600 Food & Bev Index (rebased)

Note: The figures have been adjusted to reflect the changes in share capital in 2005, 2009 and 2017;

The STOXX Europe 600 Food &Beverage Price Index is a capitalisation-weighted index which includes European companies operating in the food and beverage industry.

Davide Campari-Milano N.V. stock

Shares2425

At 31 December 2020, the total share capital of Davide Campari-Milano N.V. (including Special Voting Shares)

was equal to €18,273,183.

The total share capital consisted of 1,161,600,000 ordinary shares with a nominal value of €0.01 each, for a total monetary amount of €11,616,000, and 665,718,342 Special Voting Shares A with a nominal value of €0.01 each, for a total monetary amount of €6,657,183.

Dividend

The Board of Directors voted to propose to the Shareholders' Meeting a dividend of € 0.055 per share for the year 2020, gross of withholding taxes, in line with the previous year.

The dividend will be paid on 21 April 2021 (with an ex-date for coupon n. 1 of 19 April 2021 in accordance with the Italian Stock Exchange calendar, and a record date of 20 April 2021). The Board of Directors resolved to convene the Ordinary Shareholders' Meeting on 8 April 2021 to approve, inter alia, the financial statements for the year ended 31 December 2020, the sustainability report and the remuneration report.

24 Refer to the 'Governance' section for additional information on the composition of the share capital and details of major shareholders.
25 In the context of the Redomiciliation to the Netherlands, an Extraordinary shareholders' meeting convened on 18 September 2020 approved the reduction of the nominal value of each ordinary share from €0.05 to €0.01, as envisaged in the explanatory report of the Extraordinary shareholders' meeting held on 27 March 2020 approving the transfer of the legal office.

Information on the Campari stock and valuation indicators

The tables below show the performance of the Campari stock and the main valuation indicators used by Campari in the last five years.

YearMinimum MaximumpricepriceAverage price

Price on 31 DecemberChange in

Campari stock

Change in FTSE MIB

Relative performance of Campari(1)Average daily trading volume

Average daily trading valueStock market capitalisation at 31 December

€

%millions of shares

€ million

2020

5.54

9.85

8.25

9.34

+14.74% -5.42%
+20.16%
2.6
21.0 10,849
2019
7.37
9.22
8.40
8.14
+10.22% +28.28%

-18.06%

2.3

19.7 9,455

2018

5.75

7.79

6.82

7.39

2017

4.61

6.88

5.83

6.45

2016

3.47

5.05

4.38

4.65

+14.60% +38.8% +16.1%

-16.10% +13.6% -10.2%

+30.70%

2.3

15.4 8,578

+25.1%

2.2

13.2 7,487

+26.3%

2.8

12.0 5,396

(1) Compared with the FTSE MIB.

The table below provides information on the dividends paid on Campari stock in the last five years.

YearNumber of shares at 31 December, not adjusted

Number of shares at 31 December, adjusted(1)

Number of shares with dividend rights(2)Gross dividend per share

Total dividend

(€ million)(4)

(€)(3)

2020

1,161,600,000

1,119,406,193

0.055 61.6

2019

1,161,600,000

1,143,148,584

0.055 62.9

2018

1,161,600,000

1,145,854,255

0.050 57.3

2017

1,161,600,000

1,150,205,686

0.050 57.5

2016

580,800,000

1,161,600,000

1,158,752,164

0.045 52.1

(1) Share information prior to the dates on which changes were made to the amount of share capital has been adjusted to take into account the new composition of share capital as set out below:
- • two-for-one share split effective on 8 May 2017;
(2) Excluding own shares held by Davide Campari-Milano N.V. (at the ex-coupon date).
(3) Dividend relating to the year. Proposed dividend for the 2020 financial year.
(4) For 2020, for information purposes, the total dividend calculated on the basis of the proposed dividend and the shares outstanding at 31 December 2020 is to be recalculated on the basis of the total number of shares outstanding as at the dividend ex-date of 19 April 2021.

The table below provides information on the main valuation indicators for Campari stock in the last five years.

Year	Basic earnings	Price/shareholders' equity	Price/net profit	Dividend/net profit	Dividend/price
per share(1)	per share	per share(1)	per share(1) (2)	per share(2)
2020	0.17	5.43	56.4	32.8%	0.6%
2019	0.27	3.95	30.7	20.4%	0.7%
2018	0.26	3.97	28.9	19.3%	0.7%
2017	0.31	3.85	21.0	16.1%	0.8%
2016	0.14	2.84	32.4	31.4%	1.0%

(1) Net profit (not adjusted for non-recurring components).
(2) Dividend relating to the year. Proposed dividend for the 2020 financial year.

Investor relations

In compliance with both applicable Italian and Dutch laws, Davide Campari-Milano N.V. (as a Dutch company listed on the Italian Stock Exchange) transmits any regulated information through the transmission system 1Info

SDIR, managed by Computershare S.p.A., as well as files such information through 'Loket AFM' to the AFM

(Authority for the Financial Markets), which makes it available on its website's relevant register atwww.afm.nl.

The Company communicates and interacts regularly with the financial markets through analyst calls, investor meetings, roadshows and investor conferences, which are also attended by representatives of its top management. With regard to activities aimed at equity analysts and institutional investors, in 2020, the Company continued to interact with the financial community through numerous meetings. Since the outbreak of the Covid-19 pandemic in Italy, investor relations activities have continued without disruption and have actively leveraging digital platforms with investors based in all the main global financial centres.

Intentionally blank page

Governance

Overview of Campari Group's business

Campari Group is a major player in the global premium spirits industry, with a portfolio of over 50 premium and super premium brands, marketed and distributed in over 190 markets around the world, with leading positions in Europe and the Americas. The brand portfolio of the Group is well diversified, covering a wide range of spirits categories including Aperitif, Vodka, Liqueurs, Bitters, Whisky (including American whisky, Canadian whisky and Scotch whisky), Tequila, Rum, Gin and Cognac. The Group also has a presence in the champagne category as well as in the non-alcoholic aperitif segment. The Group categorises its brands by three main clusters (global priorities, regional priorities and local priorities) based on the geographic scale, business priority and growth potential of the brands. The rest of portfolio category relates mainly to agency brands and other own non-strategic brands of the Group.

The Group has a wide geographic exposure, with distribution of its brands in over 190 markets across the globe.

It has direct distribution networks in twenty-one markets, including the Americas (the United States, Jamaica, Brazil, Canada, Argentina, Mexico and Peru), Europe (Italy, France, Spain, Germany, Russia, Switzerland, Austria, Belgium, Luxembourg, the United Kingdom and Ukraine), Africa (South Africa) and Asia Pacific (Australia and China). France became a direct market for the Group in February 2020. These direct markets (France being excluded for 2020, as it became a direct market since February 2020) generated approximately 87% of the

Group's net sales for the financial year ended 31 December 2020.

The company's management believes that the Group's performance demonstrates the strength of its core brands, reflecting a consistent commitment to brand building initiatives and portfolio enhancement. Moreover, the Group benefits from its ability to leverage its extended distribution network, in which the Group has increasingly invested in recent years, in both developed and emerging economies, as well as its strengthened business infrastructure.

Campari Group's goal is to create and share long-term value with stakeholders. On the one side, the economic value generated and distributed provides an indication on how wealth is created, on the other there are plenty of intangible resources and initiatives that contribute to the value creation processes. In this regards, community engagement and involvement with the local territory are of fundamental importance.

The Campari Group traces its roots back to 1860 when Gaspare Campari developed the red, bittersweet aperitif that bears his name. From the opening of Café Campari in Milan in 1867 through the 1920s, the Campari Group expanded its product offerings to include a broad range of spirits and other drinks. During the 1920s, however,

Gaspare's son, Davide Campari, narrowed his focus to offer only two products: Campari and Campari Cordial. In 1932, he added Campari Soda, the first 'ready-to-drink' single serving alcoholic aperitif, marketed in modernistic

bottles designed by the renowned artist Fortunato Depero.

For the next several decades, the Campari Group concentrated on its three flagship products and continued its international expansion, which had begun in the 1920s. By the 1960s, the Group's products were being distributed

in approximately 80 countries, and by the 1980s, the Group had manufacturing facilities in Italy, France and Brazil.

In the early 1990s, the beverage industry went through a significant consolidation process with a series of mergers and acquisitions, and global groups with wide-ranging portfolios emerged. The Campari Group chose to expand through carefully selected acquisitions designed to enhance its brand portfolio and global reach. Since 1995, the Group has grown substantially, primarily through a combination of organic growth and selective acquisitions of brands and businesses.

The Group has completed over 30 acquisitions spreading over various geographies and categories since 1995.

In terms of acquisition value and strategic importance, the three main acquisitions were Skyy Spirits, LLC (2001),

Wild Turkey (2009) and Société des Produits Marnier Lapostolle S.A. (2016).

These various transactions enabled the Group to add further critical mass across its markets, particularly the key

US market, which became the Group's largest market as a result of the Skyy Spirits, LLC, Wild Turkey and Société des Produits Marnier Lapostolle S.A. transactions. Moreover, these acquisitions helped to enhance the Group's

exposure to the premium on-trade channel as well as the Global Travel Retail channel.

In the first half of 2020, the Group completed the acquisitions of its French distributor Baron Philippe de Rothschild

France Distribution S.A.S., specializing in the distribution of a diversified portfolio of international premium spirits

(including selected Campari Group's products), wine and champagne brands in France, and Champagne Lallier

S.a.r.l.. In June 2020, the Group also completed the acquisition of a 49% interest in Tannico S.p.A., the market leader in online sales of wines and premium spirits in Italy.

While the Group remains an active player in industry consolidation, in recent years it has also started to gradually streamline its business through disposals of non-core assets, in line with its strategy of focusing on its core high-margin spirits business.

The Group's history confirms the Group growing strategy that still today combines 50% organic growth with 50% external growth.

Over the past decade, the Group has gone through a significant transformational process. In an increasingly challenging economic environment, other than being very active in acquisitions and continuing to invest in brand building and portfolio enhancement, the Group has made significant investments in strengthening its distribution capabilities as well as global infrastructures, including supply chains and IT systems.

The Group has significantly expanded its production capabilities, including distilling, bottling and warehousing across the key geographies. It has also invested quite significantly in the ageing of liquid in order to fuel long-term future growth.

The Group currently aims to continue achieving profitable growth with strong cash generation, and to be a leading player in the global spirits industry by combining its passion for brand building with entrepreneurial drive and functional efficiency. Overall, management believes that the Group is strongly positioned for future growth, leveraging on the expansion of the international footprint of its enhanced brand portfolio and on external growth through acquisitions.

Management believes that the following are the Group's key strengths.

• Enhanced brand portfolio with growth potential

The Group has a strongly diversified brand portfolio with more than 50 premium brands covering the key categories, including Aperitifs, Vodka, Liqueurs, Bitters, Whisky (including American whisky, Canadian whisky and Scotch whisky), Tequila, Rum, Gin and Cognac. Among these brands, the Group has identified six Global Priority Brands (Aperol, Campari, SKYY, Wild Turkey, Grand Marnier, Jamaican rum portfolio, including Appleton Estate and Wray & Nephew Overproof). These high-margin brands currently enjoy strong market positioning in their core markets where they have, to a certain extent, further penetration opportunities, and have the strength and potential to be developed internationally, continuously expanding their footprints across markets to a larger extent than already done. Therefore, management believes that they offer the strongest potential upside in terms of sales growth and mix improvement. Moreover, the Group manages a pool of regional priority brands, which currently have still limited scale but which management believes have expansion potential within their regions. In addition, the Group has a portfolio of local priority brands that offer growth upside mainly through further penetration of their domestic markets.

• Increased global reach

The Group has invested significantly in recent years in strengthening its distribution capabilities. Currently, it has direct distribution networks in more than twenty markets. Establishing direct markets allows the Group to increase its focus on own brands in a given market from a marketing as well as a commercial standpoint, improve working capital management and achieve financial benefits whenever the critical mass reached by the Group in a given market makes a direct investment by the Group in that market financially attractive. Management believes that the distribution network the Group has today broadly covers the Group's direct market targets and the Group is now well positioned to leverage these strengthened platforms to accelerate its growth.

• Brand building and marketing capabilities

Management considers the Group's brands as its key assets. The Group has a strong history of long-term brand building and development. The Group strives to grow and maintain its market share by positioning and building its brands clearly and consistently across all their markets. Today, its brands are well positioned to further benefit from continuing trends towards premium spirits. The Group's focus in the coming years will be on the increasingly important premium end of the market and the Group will continue to invest to support its growth objectives and its long-term prospects through best-in-class marketing and innovation initiatives. With the rise of new technologies, the Group has increased its use of diverse media to build and communicate its marketing message and create awareness of the Group's various brands in diverse markets. The Group is developing its strategies with an increasing focus on the on-premise distribution channel, deemed to be the key to brand-building, and on new communications tools, especially the digital media channel, which is considered strategic thanks to its interactive, customisable and measurable properties.

• Strengthened business infrastructure

The Group undertook an intensive investment cycle aimed at significantly strengthening its global infrastructure. The Group has made significant investments to revamp and expand its production facilities in the recent years.

Currently, the Group has a state-of-the-art and fully integrated supply chain across the globe, which allows the Group to react more quickly to market demand and run innovation in a more timely and flexible manner. Moreover, the Group has made significant investments in standardizing and upgrading its IT system in order to create a common platform for business intelligence. The Group has rolled out a common SAP system globally, which allows the Group to more efficiently manage its business with higher level of operating coordination and deeper visibility. Going forward, management expects the Group's capital expenditure to be primarily driven by maintenance investments, aiming to maintain its plants and systems with up-to-date standards and technology to continue to operate in an efficient manner. In addition, with the objective of standardizing, automating and digitalizing the financial administrative processes at global level, the Group has created a Global Business Services (GBS) organization, which provides financial services to all Group legal entities with a standard accounting model and system. Such initiatives have been implemented while also leveraging the outsourcing of some standard IT and back office functions to third-party providers, which has enabled the progressive refocusing of the Group's central functions on value-added activities, while ensuring high quality and efficient levels of everyday services to continue to be provided to the business. Particularly, it increases effectiveness and efficiency and decreases overall application maintenance costs through synergies and economies of scale.

• Increased business scale

The Group generated short of €1.8 billion in revenues in 2020, almost doubling its revenues as compared with ten years ago. This result has been achieved via a combination of organic growth, through the expansion of the

Group's existing brands, as well as through acquisitions. Over the years, the Group has gradually reduced the weight of third-party brands in its portfolio, accounting for approximately 5.8% of the Group's net sales in 2020, while focusing more and more on its own brands. This has enabled the Group to progressively increase its critical mass in several individual markets where the Group has established its own routes-to-market in line with its strategy. While benefitting from an increased scale at a global level, the Group remains committed to pursuing a growth strategy that gives it the opportunity to build and maintain a leading position in all the markets where it has a direct presence. The Group now has a scalable business model, which can be leveraged across the whole organization. In 2020, the net sales achieved in direct markets accounted for approximately 87% of the Group's net sales (France being excluded for 2020, as it became a direct market since February 2020).

• Strong cash flow generation

The Group has a strong track record of cash flow generation. In recent years, the Group has concluded a series of investments (route-to-market, supply chain, IT, investments in ageing liquid after the Group's expansion to brown spirits), aimed at fuelling future business growth. With the completion of this significant investment cycle and its continuing commitment to efficient operating working capital management, management believes that the Group has significant opportunities for further expanding its solid cash flow generation. The strong cash flow generation, achieved as a result of sustained operating performance, positive return on investments and efficient working capital management, has enabled the Group to quickly deleverage after acquisitions, whilst maintaining a disciplined approach to financial management and remaining focused on a conservative leverage profile.

• Solid track record in acquisitions

The Group has been very active in the industry consolidation process with a solid track record of acquisitions.

Since 1995, the Group has completed a total of over 30 acquisitions, which significantly strengthened the Group's brand offerings and extended its geographic reach. The Group has a strong history of developing and further expanding the acquired brands via efficient marketing tools and leveraging its enhanced route-to-market. With the transfer of the registered office to the Netherlands, the Group aims to enhance its increased voting mechanism in favour of long-term shareholders and, therefore, the adoption of a more flexible capital structure that can further support the Group in pursuing growth opportunities also via major acquisitions.

• Business agility

The Group has maintained the capability of promptly adapting its business to meet changing circumstances despite its increased business scale, both with respect to its acquisition strategy and its strategic brand building activities. The recent completion of the Tannico transaction and investment in the e-commerce channel, together with the acquisitions of Champagne Lallier S.a.r.l. and RFD (now Campari France Distribution S.A.S.), and the

Group's prompt refocusing of its strategic brand building investments on digital media to continue fuelling

sustained brand momentum in unprecedented times, demonstrate the agility of the Campari Group in mastering new challenges whilst confirming its long-term objectives in terms of business growth and development commitments, even in the challenging conditions resulting from of the Covid-19 emergency.

Strategy

The Group's growth strategy aims to combine organic growth through strong brand building, via marketing, innovation and development of the existing brand portfolio, with strategic acquisitions, as further detailed above.

Premium spirits are the Group's core business and where it focuses its acquisition efforts. The Group's strategy is driven by the objective of reaching or enhancing critical mass in key geographic markets.

• Organic growth

The Group continues to generate growth for its core brand portfolio through the development of existing brands and/or the introduction of new products to brand line extensions. Key Group objectives are to:

- drive faster growth of the Global Priorities (Aperol, Campari, SKYY, Wild Turkey, Grand Marnier and Jamaican rum portfolio), and incubate Regional Priorities through best-in-class marketing, innovation and brand building;
- generate steady growth in key Local Priorities through periodic renewal;
- leverage rigorous cost discipline to reinvest savings in strategic brand building; and
- develop the Group's presence in high-potential markets.
- • External growth

The Group's acquisition strategy is driven by the objective of reaching or enhancing its critical mass in key geographic markets. The Group focuses its acquisition efforts on premium spirits brands.

Key Group objectives are to:

- seek acquisitions in markets where the Group controls its distribution;
- acquire local brands with strong brand equity to build new distribution platforms;
- identify specialty brands with strong brand equity and a unique market position and hence strong pricing power; and
- maintain financial discipline.

The Group remains committed to pursuing potential acquisitions of brands and/or businesses in accordance with the Group's philosophy of realistically evaluating the contribution capacity of the target business to the Group's overall profitability and adhering to a disciplined valuation of the target business.

In addition to acquiring businesses that have reached a meaningful scale on a stand-alone basis in given markets, thus giving the Group the critical mass on which to build new distribution capabilities, the Group also remains committed to achieving potential synergies from acquiring brands and/or businesses in markets where the Group has already established a strong presence.

A-Business overview by geographic regions

The Group segments its business for financial reporting purposes in terms of geographic regions as follows: Americas, Southern Europe, Middle East & Africa (SEMEA), North, Central & Eastern Europe (NCEE) and Asia Pacific.

The table below summarizes the Group's net sales by geographic region in absolute terms and as a percentage of Group's net sales for the financial years ended 31 December 2020 and 31 December 2019.

for the years ending 31 December

2020	2019
€ million	%	€ million	%
Americas	773.9	43.7%	821.5	44.6%
Southern Europe, Middle East and Africa	463.6	26.2%	498.7	27.1%
North, Central and Eastern Europe	403.7	22.8%	393.8	21.4%
Asia-Pacific	130.8	7.4%	128.5	7.0%
Total	1,772.0	100.0%	1,842.5	100.0%

An overview of Campari Group's presence and business composition by key markets is provided below. For a detailed description of the Group's performance in 2020 by key markets, see paragraph 'Sales performance'.

Americas

Americas represented the largest geographical region for the Group's business, accounting for 43.7% of Group's net sales in 2020. Key markets in the Americas include the United States, Jamaica, Canada, Brazil, and Mexico.

United States

The United States represented the Group's largest market. The US spirits market is the world's largest profit pool for spirits and a key priority in terms of expansion for the Group. The Group established its platform in the United States with the acquisition of SKYY Spirits, LLC in 2001, which gave the Group access to the US spirits market through SKYY Vodka. The SKYY brand was further strengthened in the following years through the introduction of line extensions, including a new product line of naturally flavoured vodkas, SKYY Infusions. Over the years,the Group has significantly diversified its portfolio in terms of brands and categories in the US market through acquisitions of brands with strong positions in the US market. In particular, the Group added Wild Turkey (Bourbon), Appleton Estate (Rum) and Grand Marnier (Liqueur). In addition, the Group successfully developed Espolòn (Tequila), allowing the acquired brand to reach the attractive US market. Moreover, over the last few years, as a result of a rediscovery of classic cocktails and with consumers starting to embrace bitter flavours, Italian spirits like Campari, Aperol, Cynar, Frangelico as well as Averna started to have greater attraction from local consumers.

Jamaica

As a result of the acquisition of J. Wray&Nephew Ltd. (formerly Lascelles deMercado Co. Ltd.) in 2012, the Group increased significantly its exposure to Jamaica. The Group has a strong leadership position in this market in particular for its Jamaican rums portfolio, Campari and Magnum Tonic. Since the acquisition, the Group has undertaken a series of reorganization processes in this market aimed at strengthening the focus of the local organization on the core spirits and wine business. Contemporaneously, with the objective of streamlining the business, the Group started a process to gradually exit from non-core businesses. In particular, the Group divested the Federated Pharmaceutical division and Agri-Chemicals Division in 2015. The Group also manages agricultural operations in Jamaica, where it grows and harvests sugar cane from which it extracts sugar sold to third parties in the region as well as molasses for the production of rum. In recent years, that business has been very negatively affected by the global decline in sugar price and reduced demand in the local market, further penalized by the Covid-19 pandemic. As a consequence, in July 2020, the Group launched a restructuring programme for the agricultural business in order to preserve the business continuity of the core spirits business in Jamaica.

Canada

Net sales in this market were mainly driven by positive business organic performance thanks to the contribution of Aperol, Espolòn and Campari. The Group's key brands in this market include Forty Creek whisky, Appleton

Estate, Grand Marnier, Aperol, SKYY Vodka and Campari.

Brazil

In Brazil, the Group manages and distinguishes its business by reference to two different portfolios: its premium spirits portfolio (including mainly Campari, SKYY and Aperol) and local portfolio (including Dreher and other local brands). In the past years, the focus of the Group has progressively shifted to high-margin premium brands in Brazil.

Mexico

The key brands in the market include SKYY ready-to-drink, Appleton Estate, Aperol, SKYY Vodka and Grand Marnier.

Other countries

Key markets include Argentina and Peru. In Argentina, the key Group brands include Cinzano, Campari, SKYY and Aperol.

In Peru, the key Group brands include Riccadonna, Aperol, Appleton Estate, SKYY and Cinzano Sparkling wines.

Southern Europe, Middle East and Africa ('SEMEA')

SEMEA accounted for 26.2% of Group's net sales in 2020. Key markets in the SEMEA region include Italy,

France, Global Travel Retail and Spain.

Italy

Over the years, the Group has largely diversified its geographic exposure and reduced the weight of the Italian market, also due to some non-core business disposals in the market. The Group enjoys an unrivalled position in the aperitif market in Italy, a key and growing category, with the Group's top-selling brands in terms of net sales being Aperol, Campari Soda, Campari and Crodino. After many years of successful development of Aperol in Italy, Aperol is today the largest spirits brand in Italy. The Campari brand is also developing very positively in this market. Recently, the Group also relaunched the Crodino brand with a new uniquely crafted packaging to further strengthen the premium positioning of the brand.

France

The key brands in the market include Riccadonna, Aperol, Campari, Grand Marnier and The GlenGrant as well as the recently acquired Trois Rivières and La Mauny French rums. France is a strategically important market for the Group where it has focused its acquisition efforts recently. Starting from February 2020, after the acquisitionof the French distributor Baron Philippe de Rothschild France Distribution S.A.S., France became a direct market for the Group.

Global Travel Retail

Global Travel Retail is a key channel for the Group to build brand visibility. The Group's key brands in this channel

include Aperol, Campari, The GlenGrant, Grand Marnier, SKYY, Wild Turkey, Appleton Estate and Bulldog.

Other countries

Key markets include Spain, South Africa and Nigeria. Spain became a direct market of the Group in April 2014.

The key brands in this market include Aperol, Campari, Bulldog, Frangelico and Cinzano Vermouth.

South Africa became a direct market of the Group in January 2017. The key brands in this market include Bisquit&Debouché cognac, SKYY, Bulldog, The GlenGrant and Espolòn.

Nigeria is a third-party market for the Group. The market has been volatile in recent years due to socioeconomic conditions in the country. The key brands in the market include Campari, American Honey, SKYY and Espolòn.

North, Central and Eastern Europe ('NCEE')

NCEE accounted for 22.8% of the Group's net sales in 2020. Key markets include Germany, Russia, the United

Kingdom, Switzerland, Austria and Belgium.

Germany

The Group's key brands in this market include Aperol, Campari, Ouzo 12, Cinzano sparkling wines, Averna and

SKYY. Thanks to the Group's continuous commitment to long-term brand building, the business has seen very positive development and momentum in this market.

Russia

The Group's core brands in this market were sparkling wines (Cinzano and Mondoro) and vermouth (Cinzano).

Over the past years, by leveraging its sparkling wines portfolio, the Group has gradually built its premium spirits brands such as Aperol, Espolòn, Campari and Wild Turkey in this market. In particular Aperol has developed very positively in the market, becoming the Group's second largest brand in Russia. The Group has witnessed a high

level of volatility in its results performance in the past years as a consequence of the economic and political uncertainties in the country.

United Kingdom

The Group started its direct distribution in the United Kingdom in January 2015. The Group's key brands in this

market include Aperol, Wray & Nephew Overproof, Campari, Appleton Estate and Bulldog.

Other countries

Key markets include Switzerland, Austria, Belgium. Aperitifs are the Group's key focus in these markets.

Asia Pacific

The Asia Pacific is the smallest region within the Group and it represented 7.4% of the Group's net sales in 2020.

Australia is the Group's biggest market in this region. Other key markets include China and Japan.

Australia

The key Group's brands in this market include Wild Turkey ready-to-drink, Wild Turkey bourbon, Aperol, American Honey, Riccadonna and SKYY. It is the second largest market by value for the Group's Wild Turkey portfolio. In

recent years, market conditions have been quite challenging, with increasing price competition.

Other countries

Key markets include China and Japan.

The Group's business in China has grown positively in the past years, from a small base. In particular, SKYY Vodka has grown very quickly over the years, becoming the Group's core brand and key growth engine in the

market. The other key brands in the market include Cinzano, X-Rated, Aperol, Campari, Wild Turkey and Grand Marnier, which are continuing their positive development.

Japan is a third-party market for the Group. In recent years the Group had a volatile performance in this market due to route-to-market changes. The key brands in the market include Wild Turkey bourbon, SKYY ready-to-drink, SKYY vodka and Grand Marnier. In February 2020 the Group entered into an agreement with a local partner to create a joint venture in Japan, aiming to further develop the brand portfolio in the Japanese market.

B-Business overview by brands

The Campari Group's portfolio comprises over 50 brands across a wide range of categories, including Aperitif,

Vodka, Liqueurs, Bitters, Whisky (including American whisky, Canadian whisky, Scotch whisky), Tequila, Rum, Gin and Cognac. The Group also has a presence in the champagne category as well as in the non-alcoholic aperitif segment. They span across all major consumption occasions, including aperitif, dinner, after dinner and night. The Group categorizes its brands into three main clusters (global priorities, regional priorities and local priorities) based on the geographic scale, business priority and growth potential of the brands. The rest of portfolio category includes agency brands and other own non-strategic brands of the Group.

The table below summarizes the Group's net sales by brand categories for the financial year ended 31 December 2020.

percentage of

full year change %, of which

Group sales

total	organic	perimeter	exchange rate
global priority brands	55.6%	-6.0%	-3.8%	-	-2.2%
regional priority brands	18.0%	3.2%	0.4%	6.1%	-3.3%
local priority brands	11.0%	-7.5%	-4.4%	0.3%	-3.4%
rest of the portfolio	15.3%	-0.5%	-10.0%	12.8%	-3.4%
Total	100.0%	-3.8%	-4.1%	3.0%	-2.7%

An overview of Campari Group's history, market positioning and growth strategy by key brands is provided below. For a detailed description of the Group's performance by key brands in 2020, see paragraph 'Sales performance'.

Global priorities

Aperol

Aperol is renowned as 'the perfect aperitif', launched in Padova, North-eastern Italy, in 1919. It was acquired by Campari Group in 2003 through the acquisition of Barbero 1891 S.p.A.. With net sales of €333.3 million in 2020.

Aperol is today the Group's largest brand by value, accounting for 18.8%. of the Group's net sales in 2020. Thanks to its easy taste and versatile consumption occasions as well as the continuous marketing support behind it, Aperol has grown by over ten times since its acquisition, developing positively both in Italy and in international markets. The Group has developed and implemented a three-stage development model for Aperol in order to build sustained growth. It includes the following phases: building on-premise recognition and appreciation via consumer activation, largely leveraging experiential marketing as well as digital media; de-seasonalizing into winter to build consumption frequency beyond the summer; extension to new usage occasions. Based on the different development stages of the markets for the brand, the Group has divided the markets into core established (including Italy, Germany, Austria Switzerland), high potential markets (including mainly the United States, Canada, Russia, the United Kingdom, France, Spain and Australia) and seeding markets which include the rest of the markets (for example, Scandinavian markets, Czech Republic, Poland, Argentina, Brazil, Chile and China). Italy today is still the largest market for the brand, accounting for approximately one third of its sales. Aperol has grown significantly in Italy over the years, becoming the number one Italian spirits brand (source: IWSR 2019). Beyond Italy, the Group has successfully expanded Aperol in many international markets, which accounted for approximately two thirds of the brand sales in 2020.

Campari

Campari is the signature brand of the Group. With a history which began in 1860, the brand is the base for many famous classic cocktails around the world such as the Negroni. With net sales of €170.5 million in 2020, Campari accounted for 9.6% of the Group's net sales in 2020.

The brand has a well-diversified geographic exposure. Italy, the biggest market for the brand, accounted for approximately 30% of the brand's net sales in 2020. Key international markets for the Campari brand include the United States, Germany, Jamaica, Brazil, Nigeria and Switzerland.

In recent years, consumers have been increasingly embracing bitters and showing growing interest in classic cocktails across the globe. Because it is easy to mix and a key ingredient for many classic cocktails including the Negroni and Americano, Campari is leveraging this positive trend for further expansion. Moreover, the aperitif culture is spreading internationally, which presents a further growth opportunity for Campari, benefiting also from the positive expansion of Aperol.

SKYY

Started in San Francisco in 1992, SKYY was acquired by the Group in 2001. SKYY Vodka revolutionized the spirits industry with its proprietary state-of-the-art quadruple distillation and innovative triple-filtration process. With its exceptional smoothness, SKYY is among the leading domestic premium vodka in the United States. The United States has been the biggest market for SKYY. In recent years, the Vodka category has been increasingly competitive in the US market, particularly for flavours. Nevertheless, the Group continues to invest behind theSKYY brand in order to sustain the brand equity and its market share. One example of this was the launch of a new integrated marketing campaign 'Proudly American' to keep the brand premium and relevant to millennial

consumers.

At the same time, SKYY has expanded into many international markets which now represent key growth drivers for the brand. Key markets outside of the United States include Germany, China, South Africa, Argentina, Canada, Brazil and Italy.

Wild Turkey portfolio

Wild Turkey was acquired by the Group in 2009. The Wild Turkey portfolio includes Wild Turkey bourbon and American Honey. The United States is the biggest market for Wild Turkey Bourbon and American Honey, accounting for almost 80% of net sales in 2020. In the United States, the bourbon category and more generally brown spirits are currently experiencing positive trends with returning consumer interests.

A key focus area of the Group to further develop the Wild Turkey portfolio is to premiumise the offering through a packaging upgrade and the introduction of more premium extensions and limited editions. Over the years, the

Group has successfully introduced premium extensions such as Wild Turkey Longbranch, Russell's Reserve and the Master's Keep. The partnership with Matthew McConaughey, the brand's creative director, also aims to

improve the brand image.

The Master Distiller of Wild Turkey, Jimmy Russell, is one of the great legends of bourbon and is considered 'The Master Distiller's Master Distiller' by his industry peers. He has been with the distillery for over 60 years, the

longest tenure of any master distiller in the industry. His son, Eddie Russell, has followed his father footsteps to continue the legend of the master distiller of the Wild Turkey distillery.

Grand Marnier

Created in 1880, Grand Marnier is one of the world's most recognized and storied spirits brands with a rich history

and strong presence in premium on-trade outlets. It is made from the unique combination of French cognacs and orange essence. It was acquired by Campari Group in 2016. The United States is the biggest market for the brand, accounting for approximately 80% of net sales in 2020. The other key markets for the brand include Canada, France, Italy, Germany, Netherlands and Mexico. Since its acquisition, the Group has relaunched the brand through the introduction of a new packaging and a new marketing campaign emphasizing the heritage and quality of the brand as well as redefining the drinking strategy of the brand by focusing on mixology, classic cocktails and long drinks. At the same time, the Group discontinued some low-margin and mainstream line extensions in the brand's portfolio including flavours and discounted editions in Europe. The latter had some negative impact on the brand performance in short-term but is considered to be beneficial for the brand's long-

term image building.

The Group also launched a selection of high-end expression of Grand Marnier, for example, Grand Marnier Cuvée du Centenaire and Grand Marnier Cuvée Louis Alexandre, aiming to further premiumise the offerings.

Jamaican rum

The Jamaican rum portfolio was acquired by the Group in 2012. It includes mainly Appleton Estate and Wray&Nephew Overproof. The rum category continues to innovate and increase its premium positioning through the launch of more high-end propositions. Wray&Nephew Overproof is a high-proof white rum, continuing to develop its reputation as a mixologist's favourite due to the depth of its flavour, versatility and quality. The brand

has grown positively in recent years both in its domestic market and in international markets, such as the United States, the United Kingdom and Canada. Jamaica is the biggest market for Wray&Nephew Overproof.

Appleton Estate is a premium rum brand and currently, Canada is its the biggest market, followed by the United States, Jamaica and Mexico. The Group continues to develop the brand in both its core markets and other international markets such as New Zealand, the United Kingdom, Peru, Italy, Australia and Germany. Recently, the Group re-designed the Appleton Estate premium range with a new brand visual identity to further elevate

Appleton Estate's visual impact, cementing its position as a premium preference for rum connoisseurs.

Regional priorities

Espolòn

Acquired by the Group in 2008, Espolòn has been re-launched as a super-premium tequila brand, handcrafted with 100% blue agave and has successfully expanded into the US market. The core market for Espolòn is the United States, where the brand has been among the fastest growing brands in the market with strong momentum.

Moreover, it is continuing to expand to other international markets, such as Australia, Russia, Italy, Canada and Mexico.

Italian bitters and liqueurs (Frangelico, Averna, Braulio, Cynar)

This portfolio includes Frangelico, Averna, Braulio and Cynar.

Frangelico is a specialty brand, acquired by the Group in 2010. It is a very distinctive brand with a hazelnut taste.

It is produced in the Piedmont region of northern Italy and its origins date back more than 300 years. The key markets for Frangelico are the United States, Germany, Australia, Spain and Canada.

Averna and Braulio were acquired by the Group in June 2014 within the acquisition of Fratelli Averna S.p.A..

Averna is made with 100% natural ingredients with a secret recipe unchanged for 150 years. It is among the leading bitter brands in Italy and in some central European countries such as Germany, Switzerland and Austria.

It has a premium price positioning. Braulio is produced on the basis of an ancient traditional secret recipe, which has remained unchanged since 1875. It envisages the infusion of roots and alpine herbs that are aged in oak barrels for two years. It is a very popular bitter brand in the Alps region in Italy and it is currently expanding throughout the rest of the country.

Cynar is an artichoke based bittersweet liqueur known for its versatility and distinctive flavour; its taste is enriched with an infusion of 13 herbs and plants. Created by Angelo Dalle Molle, a Venetian entrepreneur and philanthropist, Cynar was launched in Italy in 1952. It was acquired by the Group in 1995.The key markets for the brand include Italy, Switzerland, the United States, Brazil, Germany and Argentina.

With consumers increasingly embracing the bitter taste, the Group's management believes this portfolio can be further developed, leveraging the Group's strengthened distribution capabilities.

The GlenGrant

The GlenGrant is a single malt Scotch whisky brand, dating back to 1840. It was acquired by the Group in 2006.

The brand has reached a quite diversified geographic exposure across the years. Today the key markets for the brand are Italy, France, Germany, Global Travel Retail, the United States, Australia and South Africa.

In recent years, the Group decided to increase its long-term strategic focus on higher margin and longer aged premium expressions of the brand.

Forty Creek Whisky

Forty Creek Whisky was acquired by the Group in June 2014. It is a high-end, handcrafted Canadian whisky brand. Currently approximately 90% of the brand's net sales is generated in Canada and 10% in the United States.

It has developed positively in the Canadian market with increased national reach over the years.

At a global level, the United States is the biggest market for the Canadian whisky category and hence represents the biggest expansion opportunity for Forty Creek Whisky outside its domestic market in the long term.

Cinzano

Acquired by the Group in 1999, the Cinzano portfolio includes sparkling wines and vermouth.

The key markets for Cinzano sparkling wines are Germany, Italy, Russia, China and Switzerland. The key markets for Cinzano Vermouth are Russia, Argentina and Czech Republic, followed by Australia and Spain.

Mondoro and Riccadonna sparkling wines

Mondoro is a premium sparkling wine brand. It was first launched in the North American market in 1989 and is sold in 35 countries around the world. Riccadonna is a range of dry and sweet sparkling wines, founded in 1921.

The key markets for Mondoro and Riccadonna are Russia, France, Peru, Australia and Chile.

Local priorities

Campari Soda

Campari Soda is a single-serve alcoholic aperitif. It was created in 1932 and is considered the first pre-mixed drink in the world. Italy is its core market.

Crodino

Crodino is a single-serve non-alcoholic aperitif, produced since 1964. It was acquired by the Group in 1995. The core market for the brand is Italy. Over the years the brand has gradually expanded to some international markets and the Group is expecting to further expand the brand both domestically and internationally leveraging the positive trend of low-alcohol/no-alcoholic drinks.

Wild Turkey ready-to-drink

This is almost exclusively sold in Australia.

Rest of portfolio

This portfolio includes agency brands and other own non-strategic brands of the Group. In recent years, the Group has gradually streamlined this part of the portfolio via disposals.

With the aim of increasingly focusing on its own brands, the Group has continuously reduced the weight of agency brands over the years. Today the Group continues to distribute a selected portfolio of premium agency brands.

The key agency brands distributed by the Group in 2020 included Jägermeister in Italy, Beam Suntory portfolio in France and the William Grant&Sons portfolio in Germany.

C-Business overview by marketing and brand building

The Group considers its brand portfolio to be its strategic asset. One of the main pillars of the Group's mission is to build and develop its brands. Intangible assets are a key component of the market value of spirits products, reflecting the power of brands built up over many years. Advertising and promotional investments build and protect the value of the brands in the long term. The Group has an ongoing commitment to investments in marketing designed to strengthen the recognition and reputation of iconic and distinctive brands in the key markets, as well as launching and developing them in new high-potential geographical regions. Brand image is a critical factor in a consumer's choice of spirits products. Consumers are willing to pay higher prices for brands they like and trust,

and the strength of these brands allows companies to build a premium positioning, improve price mix and therefore generate higher returns in the mid- to long-term.

The Group strives to grow and maintain its market share by positioning and building its brands clearly and consistently across all their markets and distribution channels. The Group's main marketing objective is to devise a clear, distinctive and enduring strategy to build, increase the visibility of and develop each of the Group's

products as a premium, dynamic and contemporary brand across diverse international markets, usage occasions and consumer audiences. As shown by a number of key Group's brands, like Aperol, Campari, Wild Turkey,

Grand Marnier and Appleton Estate (in existence, respectively, since 1919, 1860, 1855, 1880 and 1749), when properly developed, the Group believes that the brand life can exist indefinitely. The Campari Group invested €309.8 million in advertising and promotion in 2020 corresponding to 17.5% of Group's net sales in 2020.

In marketing its international brands, the Group first develops a central strategy that globally reflects its group identity and strategic guidelines and then customizes an approach for each brand that it views as appropriate to the local market in terms of target audience, consumer preferences and advertising regulations. This central strategy is developed by the Group's global strategic marketing team, and internationally by local markets. Local

markets are also responsible for the marketing of local brands in their respective markets. The global strategic marketing team is also responsible for product innovation, which includes the development and the launch of new products and line extensions or the re-launch of existing products. As noted below, growth in the spirit industry is becoming increasingly dependent on innovation, which, like advertising and promotion investments, is critical in driving price and volume. Spirits consumers are increasingly attracted by new products and line extensions and are likely to pay a higher price for their distinctiveness in terms of premium positioning, quality and consumption usage.

The Group promotes its products using all major forms of advertising allowed under the applicable rules, with an increasing focus on high profile advertising, mainly aimed at brand building, rather than promotion, and at brand launches as well as consumer engagement. It uses different media to build and communicate its marketing message and create the awareness of the Group's various brands in diverse markets. While traditional media

(including TV, press, bill-boards and sponsorship) still play an important role in activating, building and strengthening the image of its brands, the Group has increased its focus on the digital media channel which is seen as strategic thanks to its interactive, customizable and measurable properties. Channel wise, the on-premise distribution channel is considered strategic and key in the Group's brand building and activation, with a great

emphasis on experiential marketing.

Additionally, more efforts have been put into category management, customer relationship management, and more sophisticated interaction with a new generation of young adult consumers in an effort to recruit consumers and enhance the impact of the Group's marketing investment.

The 'brand house' is another important brand building tool that the Group has been investing in in recent years.

For example, in November 2019, the Group reopened the iconic Camparino bar, the birthplace of the Milanese aperitif, which had been renovated to preserve and emphasize its historical heritage and art nouveau style. In November 2020 the same model of initiative was expanded in the heart of Venice (Campo Santo Stefano), where a space was acquired to become the first directly managed Aperol Flagship, later in 2021, after the renovation and marketing activities are completed.

Since the outbreak of the Covid-19 pandemic, the marketing activities of the Group have been reshaped with a strong focus on digital activations. Brand-activation activities aimed at consumers and commercial partners in the on-premise and Global Travel Retail channels were suspended or postponed given the restrictive measures.

For a summary of the Group's recent main marketing initiatives, please refer to the paragraph 'Main brand-building activities'.

Innovation

Product innovation includes the development of new products, the launch of limited editions, line extensions of existing brands, and/or the re-launch of existing products. Innovation has become increasingly important for brand building, attracting new consumers, driving sales growth and sales mix improvement in the spirits sector. Spirits consumers are increasingly attracted by new products and, based on experience, are likely to pay a higher price for distinctiveness. Some recent examples include the launch of Wild Turkey Master's Keep Bottled in Bond, a

17-year-old Kentucky straight bourbon whiskey with the bottled-in-bond label, a certification that guarantees a strict production process and ensures incomparable flavour and consistency; the introduction of new packaging for Appleton Estate emphasizing the brand's premium characteristics and the launch of Kingston 62, a new range of aged rum, in the Jamaican market; and the launch of Grand Marnier Cuvée du Centenaire to celebrate the first century of the House of Marnier Lapostolle.

The strengthened distribution networks allow the Group to quickly identify emerging consumption trends in individual markets and react quickly in terms of product development as a result of its enhanced global supply chain.

Development and expansion of acquired brands

The Group has a strong track record for re-launching and developing acquired brands outside their domestic markets through further expanding the global footprint of these brands and leveraging the Group's enhanced distribution capabilities. Some examples are given below.

After the acquisition of SKYY Vodka, the Group relaunched the brand with the introduction of new packaging as well as the launch of SKYY infusions through innovations. Over the years, the Group also managed to diversify the brand's geographic exposure by introducing it into numerous international markets.

The expansion of the Aperol brand was very successful as net sales of the brand have increased by more than ten times since its acquisition in 2004 as a result of significant growth in its domestic market as well as a strong expansion in a large and increasing number of international markets. Aperol is today the largest spirits brand in Italy. In addition, the aperitif's success has also been significant in markets outside Italy. Aperol has become a leading drink in Germany, Austria, Switzerland and Belgium also as a result of successful marketing activations, and it is experiencing very positive growth in many other European and international markets, such as the United States, Russia, France, the United Kingdom, Australia and Spain.

Moreover, following the acquisition of Espolòn in 2008, the Group re-launched the brand in the United States in the following year with new packaging, including creative labels. Espolòn is now one of the fastest growing tequila brands in the US market and is developing very positively in some other international markets, such as Australia, Russia, Italy and Canada.

The Group also re-launched and premiumised the Wild Turkey range following the 2009 acquisition, which included the re-packaging of the Wild Turkey bourbon brands, the introduction of new marketing campaigns, the reformulation of the liquid for recipe for certain products within the Wild Turkey range and the launch of Wild Turkey limited editions; the expansion of American Honey liquor in the United States, plus its successful introduction in some international markets; and the renewed line up of Wild Turkey 'ready-to-drink' in Australia, innovated with new and more premium offerings.

As regards the Jamaican rum portfolio acquired in 2012, Wray&Nephew overproof is developing positively across its domestic and international markets, leveraging the Group's strong distribution capabilities. In terms of Appleton

Estate, the Group has continued to premiumise the offerings with the introduction of new packaging for the premium range as well as releases of limited editions.

Lastly, after the acquisition of Grand Marnier, the Group relaunched the brand with the introduction of new packaging, new marketing campaign emphasizing the superior quality of the brand as well as the launch of more premium variant Cuvée.

D-Business overview by organisational structure

The organizational structure of the Group ensures the separation of roles and responsibilities between marketing and sales organizations (the regional business units), responsible for sales and marketing activities, vis-á-vis the global supply chain (GSC) organization, responsible for coordinating all supply chain activities, including procurement, planning, logistics, manufacturing & engineering, quality, health & safety and innovation.

Regional business units

The Group is broadly organized into four regional business units: Americas; Southern Europe, Middle East and

Africa; North, Central and Eastern Europe; and Asia Pacific. The regional business units are responsible for the marketing and sales activities of the Group's own brand portfolio, as well as any agency brands under distribution

in their individual region.

The Group's organization by business units largely reflects the structure of the Group's distribution network, which is organized by region so that the Group may best serve the local markets in which it is present. The Group's

strategy provides for the Group to establish its own distribution network in each country or direct market only if the Group achieves critical mass there. Otherwise, the Group distributes through third parties.

Distribution network

The Group sells its products to a large and diverse customer base located across 190 countries. In markets where the Group has local sales organizations (so-called direct markets), the Group sells to retailers and wholesalers through its internal sales organization. In markets where the Group does not have its own local sales organizations (so-called third-party markets), the Group works with carefully selected local third-party distributors and importers to ensure high-quality distribution and brand development in these markets.

As at the date of this Annual Report, the Group has direct distribution networks in 21 markets, including 7 in the Americas (the United States, Jamaica, Canada, Brazil, Mexico, Argentina and Peru), 4 in SEMEA (Italy, France,

Spain and South Africa), 8 in NCEE (Germany, Russia, Switzerland, Austria, Belgium, Luxembourg, the United

Kingdom and Ukraine), and 2 in Asia Pacific (Australia and China). These subsidiaries manage the Group's own

brands and distribute a number of other leading brands under distribution agreements.

In addition, the Group has established a regional office in Singapore, which is now also the head office for the Asia Pacific region. It is responsible for all the marketing and coordination activities for countries in the region, in order to ensure a more comprehensive oversight of these markets and to support the growth of the Group's brands in the Asian markets.

In line with the Group growing strategy some distribution changes took place to empower the Group presence in the Asian Pacific market starting from 2021. In particular some agreement has been closed during the first months of 2021 enabling Campari Group to manage directly the local market in South Korea and China.

Global supply chain

The Campari Group's Global Supply Chain (GSC) operates an end-to-end supply solution covering the functions of Safety, Procurement, Manufacturing&Engineering, Planning, Logistics&Customer Service, Quality and Environment, Research & Development (R&D) as well as oversight of external co-packing operations.

The GSC strategy is to provide a superior quality customer centric supply chain solution that is globally leveraged and cost competitive.

Externally the role of GSC is to provide products to consumers of the right quality and in compliance with all regulatory requirements and to ensure the right level of customer service. Internally the role is to continue to ensure levels of efficiency in the Group's manufacturing, procurement and logistics operations with the aim of

keeping costs below inflation and supporting the margin accretion.

In addition, the role of GSC is to control Demand Planning (DP) to provide the most accurate future demand forecast with the objective of minimizing inventory while still providing the highest levels of customer service.

The structure of GSC allows for the focus of design of GSC solutions to be owned and delivered by central functions and the execution of the design to be managed locally in regions. This structure ensures a more consistent approach, reduced IT complexity and spend, 'design once and execute many' adoption of initiatives

and, ultimately, a more efficient and effective GSC.

Head of the Regional Supply Chain

In the Americas, Europe and Asia-Pacific ('APAC') regions the Group has created a regional supply chain ('SC') lead whose job is to coordinate the execution of both the global strategy and, more specifically, to meet customer needs in the countries within each region. The regional lead has a team made up of both country SC leads and regional functional leads, working within a matrix organization to deliver regional requirements. Ultimately the regional SC lead has the power of decision to ensure local needs are delivered, while at the same time delivering global programmes adding value and reducing costs.

Procurement

The Group's Procurement department manages two globally lead categories, Direct Categories (including

materials and ingredients) and Indirect Categories (including media, marketing, consultancy, Travel and Entertainment ('T&E'), logistics and capital expenditure). The Group's Procurement department also operates at country level in the three regions of Americas, Europe and APAC.

The development of a central category leadership is providing longer-term sourcing strategies in key components such as glass and agave, digital media and marketing spend, ultimately creating higher value for the Group andlower costs.

Key responsibilities of the Procurement department are to implement a structured approach on the management of the supplier relationships to contribute more effectively to innovation, value creation, sustainability and business continuity.

Global Logistics

The Campari Group has invested in a new Global Head of Logistics recognizing the importance of this area and its impact to cost of goods sold (COGS). This new role performs two distinct activities:

1. It sets in place the Group's strategic approach on logistics in relation to developing global partnerships with third-parties logistics providers for primary and secondary transportation as well as warehousing and distribution platforms to support the Group's route to market network.
2. It provides governance for the regional and local execution ensuring robust and consistent contracts are in place and that appropriate efficiencies are built into new initiatives.

The initial distribution (primary flow) of finished products from the manufacturing plant to in-market companies is managed under global service agreements through strategic partnerships delivering more cost effective and improved transportation network. With regard to the delivery of finished goods orders to the Group's third-party distributor markets, in most cases, the products are sold on Ex-works or FOB (Free On Board) incoterms at the point of supply, with the distributor arranging their own pickup and preferred transportation. This is also the main commercial arrangement for the Group's Global Travel Retail customers. Warehouse and distribution operations are managed either internally, through local plant operations, or through carefully selected third party logistics service providers. For secondary transportation (delivery from in-market companies to customer), this is all managed locally and outsourced to preferred carriers. Exceptions exist in some markets, for example in the United States where it is common practice in the industry for US distributors to arrange the transport and pickup from the suppliers' warehouse. Group logistics works with the Product Supply Chain ('PSC') regional and local logistics teams to ensure that cost, quality, business continuity and service are delivering value to the Group's commercial success.

Manufacturing & Engineering

The Campari Group has over fifty brands in its portfolios covering a wide range of categories. Each has a specific production process with cycles ranging from a few hours to many years in the case of aged spirits such as whiskies and rum.

Over the past few years, the Group has completed a series of investment projects aimed at renovating, expanding and in-sourcing production capacity to meet the expected future demand of its products. Today, the Group has an integrated manufacturing solution, including distilleries, processing and bottling facilities, maturation sites, warehouses and distribution centres.

Significant investment has taken place recently in the Group's Italian plants to accommodate the growth of key brands such as Aperol as well as to take the bottling activity of Crodino back into the Group operations on the expiry of a temporary outsourcing agreement put in place with a third party manufacturer when the brand's original plant was disposed of. In addition, the Group has made substantial investments in Mexican Tequila distilling capacity as well as further investments in Jamaica to modernize and upgrade distilling capability. The objective of these investments is to improve the capacity and productivity of local plants as well as comply with local regulations and satisfy new environmental requirements.

Continuous investments are taking place in order to keep equipment updated with new technology as well as changing safety and quality requirements with the ultimate objective of continuously increasing the productivity overall as well as streamlining processes with the use of minimum resources and low impact on the environment. A growing use of digital platforms is envisaged to further support cost reduction and build capability.

The Group currently operates in 22 production sites, of which 20 are owned, including distilleries and bottling plants as well as agriculture operations, in 11 different countries (4 in Italy, 5 in France which include 2 in Martinique, 3 in Jamaica, and 1 in each of Greece, Scotland, Canada, the United States, Argentina, Brazil and Mexico, Australia). The leased production facilities derive from the recently acquired Ancho Reyes and Montelobos business in Mexico.

Global Engineering

The Global Engineering department is mainly responsible for leading relevant industrial projects; coordinating the

Group's industrial capital expenditure defining methods and contributing to approval and execution; setting and managing maintenance standards, systems, tools and processes for ensuring their application in the plants; defining strategy for relevant machinery and leading major negotiations with suppliers; identifying non-economic key performance indicators in plants and defining relevant methods; leading functional community sharing and promoting best practices.

The Group is committed to ensuring the quality and consumer safety of its products, occupational health andsafety in the workplace, protection of the environment and compliancy with all relevant laws and regulations in connection with the Group's products and manufacturing processes.

Global Safety

To promote the importance of its Safety function, the Group has moved leadership of Safety from the combined function of Quality, Health, Safety and Environment and has created two large regional roles for Europe and Americas.

Global Quality and Environment

The Campari Global Quality and Environmental function performs two distinct roles:

1. Leadership of the standards required to make products right first time in every location (internally and externally) by meeting all applicable Food Safety and Quality standards and checks their consistency through rigorous inspection controls, as well as the monitoring and actioning of consumer complaint data. This also includes chemical, microbiological and sensory analysis in both central and regional laboratories.
2. Leadership of the corporate environmental strategy. This covers the Group's ambitions to reduce the consumptions of energy, water and waste, as well as meeting the Group's local regulatory environmental
requirements. An IT system monitors and provides indicators on all aspects of environmental performance across all sites.

Research & Development ('R&D')

The newly created R&D function provides control and validation over product formulas, new manufacturing processes and provides leadership on product and process innovation. It also is the key holder for proprietary formulations.

Inventory

Since some whisky (bourbon, Scotch, Canadian), cognac, tequila and rum varieties are aged for different periods of time, the Group maintains substantial inventories of maturing liquids in warehouse facilities. Production of maturing inventory is generally scheduled to meet future demand. Production schedules and barrel inventory are also adjusted to bring inventories in line with estimated future demand. Based on the positive expectations of future demand for its aged products such as Wild Turkey bourbon, Appleton Estate rum, The GlenGrant scotch whisky, Espolòn tequila, Grand Marnier liqueur and Bisquit&Debouché cognac, the Group has made substantial investment in ageing liquids over the past few years.

Risk management and Internal Control System

The risk management and internal control system is an integral part of the Campari Group's operations and culture and supports the efficiency and effectiveness of business processes, the reliability of financial information and compliance with laws and regulations.

Campari Group has a risk management system in place aimed at identifying, assessing, managing and monitoring potential events or situations that could potentially impact Campari Group's activities and the achievement of its objectives.

Campari Group has implemented a tool to identify, assess and monitor corporate risks. This tool is based on the logic of Self Risk Assessment (SRA), which provides for self-assessment and direct participation by operational management and/or other operators responsible for risk assessment. Individuals are asked to assess the impact and likelihood of each risk. The SRA tool has multiple objectives: to help the business identify risks and consequently make strategic and operational decisions; to strengthen understanding of the Group's risk profile to allow decision makers to analyse risks and monitor how they evolve over time; to ensure traceability of risk assessment activities that provide the foundation for the financial information communicated to stakeholders. The SRA is performed globally at local, business unit and group level.

Campari Group operates at three levels of internal control:

- First Level: operating areas identification, evaluation and monitoring of applicable risks in individual processes and the establishment of specific actions for managing such risks. The structures responsible for the individual risks, for their identification, measurement and management, as well as for the performance of the necessary checks are located at this first level.
- Second Level: departments responsible for supporting management with setting policies and procedures and in developing process and controls to manage risks and issues.
- Third Level: it provides an independent and objective assurance of the adequacy and effective operation of the first and second levels of control and, in general, of the overall mode of managing risks. This activity is carried out by the Internal Audit function which operates independently; assessment of the controls may require the definition of compensating controls and plans for remediation and improvement. The results of the monitoring are subject to periodic review by management.

The internal control system is subject to verification and updating annually in order to ensure its constant suitability as an instrument of control over the business's principal areas of risk.

The Control and Risks Committee, External Auditors and Board of Directors monitor the effectiveness of the

Campari Group's internal control and risk management system.

In 2020, Campari Group's risk management and internal control system operated as designed.

Risk Appetite

Campari Group sets its risk appetite within risk taking and risk acceptance parameters that are driven by the applicable laws, the Code of Conduct, core values and corporate policies. Campari Group operates within a relatively low overall risk range, inherent to its activities and strategy. The Group's risk appetite differs by risk category, as set out below:

Risk Category	Category Description	Risk Appetite
Strategic (S)	Risks related to Campari Group's business strategy that could affect its long-term positioning and performance	Campari Group is prepared to take risks in a responsible way that takes stakeholders' interests into account and is consistent with the Group's growth strategy by maintaining a very disciplined financial approach
Operational (O)	Risks impacting internal processes, people, systems and/or external resource that affect the Group's ability to pursue its strategy	Campari Group looks to mitigate operational risks to the maximum extent based on cost/benefit considerations
Financial (F)	Risks relating to uncertainty of return and financial loss due to financial performance	Campari Group has a cautious approach with respect to financial risks. Through debt capital market transactions, cash balances and bank credit line agreements, Campari Group seeks to maintain a debt/capital structure profile which achieves investment in long-term goals and reward stakeholders
Compliance (C)	Risks of non-compliance with laws, regulations, local standards, Code of Ethics, internal policies and procedures	Campari Group holds itself and its employees responsible for acting with honesty, integrity, respect and strives to comply with the Group's Code of Ethics, applicable laws and regulations at all times everywhere the Group operates

With regard to overall performance in 2020, the Group's net sales totalled €1,772.0 million, with an overall decrease of -3.8% as compared to 2019. The organic growth component showed a negative trend with a contribution of -4.1%, essentially attributable to the effect of the Covid-19 pandemic.

The main risks to which the Group is exposed are detailed in the next paragraph. For more information on other financial risks, including credit risks, liquidity risks and cash-flow risks, please refer to Campari Group consolidated financial statements at 31 December 2020.

ii.

Main risks for Campari Group

Strategic risks

Risks relating to dependency on the sale of key products and the seasonality of certain Campari Group products (S)

A significant proportion of the Campari Group's sales are focused on certain key brands, such as Aperol, Campari,

SKYY Vodka, Wild Turkey, Grand Marnier and the Jamaican rum portfolio including Appleton Estate and

Wray&Nephew Overproof. In 2020, 55.6% of the Group's consolidated net sales came from these brands.

Accordingly, any factor adversely affecting the sale of these key products individually or collectively could have a material adverse effect on the Campari Group's results from operations.

In addition, sales of certain Campari Group products are affected by seasonal factors due to different consumption patterns or consumer habits. In particular, aperitif consumption tends to be concentrated in the hottest months of the year (May to September), whereas sales of other products, such as sparkling wines and spirits, are concentrated in the last quarter (September to December). Seasonal consumption cycles in the markets in which the Campari Group operates may have an impact on its financial results and operations. Although Campari Group has a global presence, the majority of its revenue is in the northern hemisphere. This is particularly true in the summer months, when unseasonably cool or wet weather can affect sales volumes.

Mitigation actions put in place by Campari Group to mitigate those risks include investments in products' success and growth to increase brands value and the Group's diversified portfolio of products and brands

Risks relating to the Campari Group's dependence on consumer preferences and habits and propensity to spend (S)

An important success factor in the beverage industry is the ability to interpret consumer preferences and tastes particularly those of young people and to continually adapt sales strategies to anticipate market trends and developments using its media and marketing tools.

Preferences and tastes can change in unpredictable ways due to a variety of factors, such as changes in demographics, consumer health and wellness, concerns about obesity or alcohol consumption, product attributes and ingredients, weather, negative publicity resulting from regulatory action or litigation against the Campari Group or comparable companies or a downturn in economic conditions that may reduce disposable income and make consumers less likely to buy drinks. Changes in lifestyle and everyday behavioural patterns can occur also as a result of global pandemics and subsequent restrictions including safety measures enacted by governments such as social distancing and lockdown, changes in travel, vacation or leisure activity patterns. Consumers may also begin to prefer the products of competitors or may reduce their demand for products in the spirits and wine categories in general.

In order to mitigate these risks, Campari Group leverages a diversified portfolio of brands to ensure coverage of consumer occasions, trends and prices and constantly monitors consumer trends at market and brand level.

Nevertheless, if the Group's ability to understand and anticipate consumer tastes and expectations and to manage its own brands were to cease or decline significantly, this could significantly affect its activities and operating results. Moreover, the unfavourable economic situation in certain markets may dampen the confidence of consumers, making them less likely to buy drinks.

The outbreak of a new strain of the coronavirus (Covid-19) has disrupted and is expected to continue to disrupt financial markets and the operations of businesses worldwide. On 11 March 2020, the World Health Organization declared Covid-19 a pandemic after more and more countries across the globe reported infections. The rapid spread of Covid-19 has resulted in a rapid deterioration of the socio-economic and financial situation globally, with a consequential negative impact on all markets in which the Campari Group operates. Furthermore, in order to contain the spread of Covid-19, governments of the various countries concerned have introduced progressively more restrictive measures to limit the movement of, and contact among, people (including social distancing, quarantine, 'shelter in place', lockdown or similar orders and travel restrictions) and suspended productive activities in sectors defined as non-critical, allowing only essential activities and production to continue. Such measures restricting social contact have had, and continue to have, an adverse effect on global trade and supply chains and more specifically with respect to the spirits business, a significant adverse effect on consumption levels given the sector's natural exposure to consumption in the on-premise distribution channel mainly represented bybars and restaurants. Furthermore, the significant reduction in air travel resulting from travel restrictions has had, and continues to have, an adverse effect on the Group's retail travel sales.

Despite Campari Group's flexibility and capability of adapting to changing conditions (e.g. re-forecasting,

capability to focus on online rather than on traditional sales, flexibility in cash flow management), the Group is unable to predict the ultimate impact from Covid-19 on the results of its operations, financial condition, business and/or prospects. Although lockdown restrictions are temporary in nature and are gradually being eased across many countries as a result of a gradual improvement in the health crisis, restrictive measures may nonetheless continue for an extended period of time and intensify depending on developments in the pandemic, including new waves of the Covid-19 outbreak, and on vaccine administration and effectiveness. Further management time and resources may need to be spent on matters related to Covid-19, distracting from implementation of the Campari Group's long-term strategy. In addition, the new protocols, work practices and safety measures that the Campari

Group has been required to adopt in its plants and distilleries may be costly and may affect production levels. The

Campari Group's suppliers, customers, distributors and other contractual counterparties may be restricted or

prevented from conducting business activities for indefinite or intermittent periods of time, including as a result of safety concerns, shutdowns, slowdowns, illness of such parties' workforce and other actions and restrictions

requested or mandated by governmental authorities.

Uncertainty remains as regards the extent and timing of the economic recovery to pre-Covid-19 levels in when the restrictive measures are gradually lifted across different markets. For example, many on-premise outlets will not be re-opening, and although a considerable number of outlets have expanded their outdoor spaces to give customers a greater sense of safety, many people are still cautious and are avoiding public places. Social distancing is also reducing the number of clients that can be served.

Each of these factors is likely to continue to have a negative impact on consumer demand and consumption, as well as on the Group's capability to continue to implement brand building strategies targeting the on-premise channel and will consequently have an adverse effect on the Group's results of its operations, financial condition,

business and/or prospects.

Any of the foregoing could limit consumption of the Group's products or the Group's capacity to meet demand for its products and consequently have a material adverse effect on the Group's results from its operations, financial

condition, business and/or prospects. While the Campari Group is continuing to monitor and assess the evolution of the pandemic and its effects on the macroeconomic scenario, on the markets in which it operates, on the behavioural patterns of its consumer base and on the Campari Group's financial position and results of its

operations, significant uncertainty remains about the length and extent of the restrictions in the markets in which Campari Group operates. The future impact of the Covid-19 pandemic on the Campari Group's results from operations, financial condition, business and/or prospects, which may be material and adverse, will depend on ongoing developments in the pandemic, including the success of containment measures and other actions taken by governments around the world, the possibility of further waves leading to the re-imposition of severe lockdown measures as well as the overall condition and outlook of the global economy.

The Covid-19 pandemic may also exacerbate other risks, including, but not limited to, the Group's competitiveness, demand for the Group's products, shifting consumer preferences, exchange-rate fluctuations,

and credit market conditions affecting the availability of capital and financial resources.

Risks relating to adverse macroeconomic and business conditions and instability in the countries in which the Group operates (S)

Global economic conditions and conditions specific to developed markets, including Italy, other major European countries, the United States and Australia as well as the emerging markets in which the Campari Group does business (including in eastern Europe, Asia, Latin America and Africa) could substantially affect its sales and profitability.

Operating in emerging markets makes the Group vulnerable to various risks inherent in international business, including exposure to an often unstable local political and economic environment which may impact the ability of the Group to trade locally and the ability of the Group's counterparts to meet their financial obligations, exchange-

rate fluctuations (and related hedging issues), export and import quotas, and limits or curbs on investment, advertising or repatriation of dividends. Each of these risks could have a negative impact on the Group's activities in the relevant emerging markets and consequently on the Group's financial results, assets and liabilities and

cash flows. Consequently, the Group constantly monitors developments in the global geopolitical environment that could require a review of the corporate strategies put in place and/or the introduction of measures to safeguard its competitive positioning and performance.

Global economic activity went through a sharp economic downturn following the 2007-2008 global financial crisis.

The disruption to global financial markets created increasingly difficult conditions in recent years, including decreased liquidity and availability of credit and greater market volatility, which continue to affect the functioning of financial markets, the global economy and international trade. The international macroeconomic situation continues to be characterised by uncertainty, due in part to the progressive heightening of tensions in international trade between the United States and China, the slowdown of economic growth recorded in the Eurozone, China'sslowing economy, the increase in the volatility of international equity markets in a context of increased risk aversion among investors, and the volatility that has characterised the European corporate bonds markets, which have been negatively affected by the global macroeconomic scenario.

It is difficult to determine the breadth and duration of the economic and financial market problems and their potential effects on consumers of the Group's products and on its suppliers, customers and business in general.

For example, distributors may reduce inventory levels, consumers may choose to buy fewer spirits or to 'trade-down' by buying fewer premium products in preference for lower categories of spirits or wines, a lower volume of travellers, especially air travellers, may reduce retail travel sales, and competitors may reduce prices. Continuation or a further worsening of these difficult financial and macroeconomic conditions could materially adversely affect the Campari Group's sales, profitability and results from its operations. Therefore, the Group constantly monitors and assesses the markets in which it operates, as well as customers' behavioural patterns.

Risks relating to acquisitions (S)

The Campari Group expects that the ongoing consolidation within the spirits business will continue and it will therefore continue to evaluate potential acquisitions. The pursuit of these opportunities, and, if such pursuit is successful, the subsequent integration of the businesses acquired, places significant demands on the time and attention of the Campari Group's senior management and may involve considerable financial and other costs (for example, in the identification and investigation of potential acquisitions, the negotiation of agreements and the challenges associated with integration, particularly where the accounting and management systems differ materially from those used elsewhere within the Group). In addition, the Campari Group may from time to time incur additional indebtedness to finance acquisitions. The Campari Group may therefore be exposed to risks in relation to acquisitions that may have an adverse effect on the Campari Group's financial condition and results from its operations.

Despite Campari Group having implemented a diversified investment strategy, with integration plans being implemented and monitored, the Group's growth prospects may suffer if the Group is unable to implement its acquisition strategy and/or realise the full intended benefits of synergies if, for example, the Group encounters unexpected difficulties when integrating businesses acquired. Employees and customers of acquired businesses may sever their relationships with those businesses during or after completion of the transaction. In addition, if the Campari Group makes an acquisition in a market outside of those in which the Group currently has a presence, the Group will have to address an unfamiliar regulatory and competitive environment and may not be able to do so successfully, which might adversely affect the Campari Group's operations in that market.

Risks relating to the disruptions or termination of the Campari Group's arrangements with the Group's third party manufacturers or distributors (S)

The production and distribution of the Campari portfolio is carried out, to a large extent, directly by the Campari Group. However, the Campari Group relies upon third parties (including key customers in specific geographies) to distribute, and in some cases also produce, a number of its own brands in a number of markets under licensing arrangements. Outside of the Campari Group's twenty-one direct markets, including seven in the Americas (the United States, Jamaica, Brazil, Canada, Argentina, Mexico and Peru), eleven in Europe (Italy, France, Spain, Germany, Russia, Switzerland, Austria, Belgium, Luxembourg, the United Kingdom and Ukraine), one in Africa (South Africa) and two in Asia Pacific (Australia and China), the Group generally depends upon third parties to distribute its products.

In 2020, 13% of the Group's consolidated net sales came from distribution under license of own products outside its direct distribution network. The vast majority of the Group's own products were manufactured by the Group and the remainder were manufactured by third parties under license. Furthermore, the Campari Group distributes third-party brands under license agreements in certain markets. In 2020, 5.8% of the Campari Group's consolidated net sales came from distribution by the Campari Group under license of third-party products. Although licenses are with several third parties, avoiding concentration on few licenses/third parties, the use of or reliance on third parties for these critical functions entails risks, including the risk of termination of licences and of delays or disruptions in production and distribution. Furthermore, the Group has less control over the quality of products manufactured by third parties. In addition, in certain cases, there may be no suitable replacements for the Campari Group's third-party manufacturers. A disruption or termination of the Campari Group's present arrangements with these third parties without having suitable alternative arrangements in place could have a material adverse effect on the Group's business, prospects, results from its operations and/or financial condition.

Risks relating to a decline in the social acceptability of Campari Group's products or governmental policies against alcoholic beverages (S)

The Campari Group's ability to market and sell its alcoholic beverage products depends heavily on both society's attitudes toward drinking and governmental policies that flow from those attitudes. In recent years, increased social and political attention has been directed at the alcoholic beverage industry. Recently, this attention has focused largely on public health concerns related to alcohol abuse, including drinking and driving, underagedrinking, and health consequences from the misuse of alcoholic beverages. Although Campari Group has a global presence, alcohol critics in Europe and the United States increasingly seek governmental measures to make alcoholic beverages more expensive including through tax increases for certain product categories, restrict their availability, and make it more difficult to advertise and promote, including as a result of laws and regulations aimed at restricting advertising. If the social acceptability of alcoholic beverages were to decline significantly, sales of the Campari Group's products could materially decrease. The Campari Group's sales would also suffer if governments ban or restrict advertising or promotional activities, limit hours or places of sale, or take other actions designed to discourage alcohol consumption.

Consequently, the Group constantly monitors regulatory changes, consumer trends at market level and promotes responsible drinking initiatives.

Risks relating to market competition and the consolidation of participants in the beverages industry (S)

The Group is part of the alcoholic and non-alcoholic beverage sector, where there is a high level of competition and a huge number of operators. The main competitors are large international groups involved in the current wave of mergers and acquisitions that are operating aggressive competitive strategies at a global level. The Group's competitive position vis-à-vis these major global players, which often have greater financial resources and benefit from a more highly diversified portfolio of brands and geographic locations, means that its exposure to market competition risks is particularly significant.

In addition, the consolidation of participants in the beverages sector may increase competitive pressures as larger suppliers are able to offer a broader product line. Consolidation in the beverage industry may also reduce the number of distribution outlets available to the Group, or lead to higher distribution costs. The Campari Group competes with other brands for shelf space in retail stores and marketing focus by independent wholesalers. Independent wholesalers and retailers offer other products, sometimes including their own brands, that compete directly with the Campari Group's products. If independent wholesalers and retailers give higher priority to other brands, purchase less of or devote inadequate promotional support to the Campari Group's brands, it could materially and adversely affect the Group's sales and reduce the Group's competitiveness. For example, due to intense competition in Europe, the Campari Group may not be able to increase prices of its brands in line with rising production, selling and promotional costs and/or in line with its price positioning/premiumisation strategies. Moreover, delays or unanticipated increases in the costs of developing new products or in gaining market acceptance for new products could further adversely affect the Campari Group's competitive position and results from its operations.

The Group constantly monitors the industry dynamics of mergers and acquisitions and the initiatives taken by competitors, constantly invests in its products' success and growth to increase the brands value and expand customers.

Risks related to the relationship of the United Kingdom with the European Union (S)

The United Kingdom's membership of the European Union ended on 31 January 2020 (Brexit) in accordance with the agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (the Withdrawal Agreement). Under the terms of the Withdrawal Agreement, a transition period commenced which lasted until 31 December 2020. In December 2020, the United Kingdom and the European Union reached an agreement on the future relationship between them. The United Kingdom is a high potential market for the Campari Group. The Group has a direct distribution network in the United Kingdom and operates in the country through local offices, plants and distilleries. In 2020, approximately 2.8% of the Group's net sales were generated in the United Kingdom. Any material adverse effect of Brexit on global or regional economic or market conditions could lead to changes in consumer spending in the United Kingdom, exchange-rate volatility, or restrictions in the movement of people and goods, all of which could adversely affect the Group's business, the results from its operations and financial condition. Moreover, the United

Kingdom could experiment, post-Brexit, with changes to laws and regulations in areas such as intellectual property rights, employment, the environment, supply chain logistics, data protection, and health and safety, each of which could have an adverse effect on the Campari Group's operations in the United Kingdom. The potential implications of Brexit cannot be fully understood until any future tariffs, taxes and other free-trade agreements and regulations have been established by the United Kingdom. As such, no assurance can be given that such matters relating to Brexit would not adversely affect the ability of the Campari Group to satisfy its obligations under the Notes and/or the market value and/or the liquidity of the Notes in the secondary market.

However, political developments will be continuously monitored to anticipate and minimize any vulnerabilities in all the main functions affected, and to adopt prudent measures to mitigate the risks, where possible.

Environmental risk (S)

Production activities and the implementation of the Group's strategies are subject to the effects of natural events.

Environmental changes, some of which could have a significant impact, could interfere with local supply chainsand harm some customers. These events are generally unpredictable and may affect the seasonality of sales, just as natural disasters (such as hurricanes) may damage products and disrupt production at some plants. The Group monitors environmental risks, has emergency plans in place and continuously develops plans to deal with such crises. The Group counts compliance with regulations and with local and international standards among its priorities, together with business continuity assessment, back-up scenarios and global insurance policies.

Exchange-rate and other financial risks (S and F)

While the Campari Group reports its financial results in euros, the Group's portfolio of brands generates sales and costs throughout the world in a variety of currencies. Around 62% of the Group's consolidated net sales in 2020 came from outside the Eurozone. With the Group's international operations outside the Eurozone growing, a significant fluctuation in exchange rates, principally caused by macroeconomic or political instability or, in the specific case of the United Kingdom, by uncertainty about Brexit, could have a negative impact on the Group's activities and operating results.

However, the existence of permanent Group establishments in countries such as the United States, the United Kingdom, Australia, Jamaica, Brazil, Canada, Russia and Argentina allows this risk to be partially hedged, given that both costs and revenues are broadly denominated in the same currency. Therefore, exposure to foreign- exchange transactions generated by sales and purchases in currencies other than the Group's Euro functional currency represented a moderate proportion of consolidated sales and profitability in 2020, hence the use of hedging measures was very limited.

For a more detailed analysis of the Group's financial risks, please refer to Campari Group consolidated financial statements at 31 December 2020.

Operational risks

Risk relating to an inability to attract and retain qualified personnel (O)

The Campari Group's success depends in part on the efforts and abilities of its senior management team and key employees. The loss or retirement of senior management or other key personnel, or an inability to identify, attract and retain qualified personnel in the future, may make it difficult for the Group to manage its business and could adversely affect its operations and financial results. Therefore, Campari Group has put in place talent reviews and succession plans, as well as talent development programmes and retention plans for key resources.

Risk from fluctuations in the prices of raw materials or energy (O)

Market risks consists of the possibility that changes in exchange rates, interest rates or prices for raw materials or commodities (alcohol, aromatic herbs, sugar, agave and cereals) could negatively affect the value of assets, liabilities or expected cash flows.

The price of raw materials depends on a wide multiplicity of unpredictable factors, that are not under the control of the Group. Historically, the Group has basically not had any problems in obtaining an adequate and high-quality quantity of raw materials. However, it cannot be excluded the possibility that the Group could face challenges with the supply of raw materials. This situation could have an impact on costs and consequently on the Group results and cash flow. In this regard from 2016, the Group has been faced with an increase in the price of agave, the raw material for tequila, due to increased demand for agave and tequila. The Group is implementing actions aimed at reducing agave price fluctuations, including by signing co-investments agreements with local agricultural manufacturers to guarantee qualitative and qualitative quantities of agave. The benefits of these investments will probably only be observable in the medium term, given the natural growing process of agave plants. In addition, energy price increases result in higher transportation, freight and other operating costs for the Group and have an indirect impact on the purchase of key ancillary materials, such as glass. Procurement policies are in place in order to maximize efficiency.

An increase in the cost of raw materials or energy could therefore increase costs for the Group and consequently have an adverse impact on the Group's cash flow and financial results.

Risk related to climate change (O)

Campari Group recognizes the importance of climate change risk and how the Group's inability to manage it could negatively affect Campari Group's reputation, revenues, and profits (e.g. via increased taxation and supply chain volatility).

Campari Group promotes a responsible use of resources and a reduction of the environmental impact of production to mitigate climate change. In this context, Campari Group has adopted an environmental policy that applies to all company locations and divisions and has set up a structure dedicated to control environmental pollution, waste, and water disposal. The Group closely monitors energy consumptions and carbon dioxide emissions and undertakes initiatives to reduce them by increasing the use of lower-emission energy source. The Group has also set specific targets in line with the UN Sustainable Development Goals aimed at reducing Green House Gases (GHG) emissions deriving from the Group's direct operations and the overall supply chain, and atincreasing the use of renewable electricity in all European production sites (for more information refer paragraph 'Non-financial disclosure' of the governance section).

Risk relating to disruption in information technology systems (O)

The Groups depends on its information technology and data processing systems to operate its business, and a significant malfunction or disruption in the operation of its systems, human error, interruption of power supply, or a security breach that compromises the confidential and sensitive information stored in those systems, could disrupt the Group's business and adversely impact the Group's ability to compete. The major risks associated with cyber-security include reputational damage caused by breaches/ theft of sensitive data, the malfunctioning or disruption of IT systems, the unavailability of online services due to a malware attack and the increased cost of resolving these problems. Cyber-security risks have a global impact for Campari Group, due to both the strong interconnectedness within the Group and the ever-increasing pervasiveness of technology (and the internet) on the performance of activities. The Group has implemented awareness campaigns to heighten employee awareness of cyber risks (C-Level fraud, Phishing, Social Engineering). Employees take part in annual e-training sessions and take monthly tests to improve their knowledge of the main cyber threats.

The Covid-19 pandemic has triggered extensive use of remote working arrangements that have been implemented, where feasible, across all regions. Wherever possible, smart-working policies have been recommended for office-based employees, given that the safety and wellbeing of Camparistas is a top priority. Campari Group had put in place a smart working policy prior to the Covid-19 pandemic and is engaged in major projects that leverage online digital technologies and expand on smart working in the Group's offices. Therefore, new protocols, training programmes, work practices and safety measures have been introduced and reinforced during 2020 by the Group to prevent malware attacks. More flexible working methods are being promoted as they can bring benefits for both Camparistas and the Group, encouraging a better work-life balance and increasing employees' responsibilities in pursuing the Group's objectives and results. Notwithstanding the procedure introduced, in November 2020 Campari Group was the victim of a targeted ransomware attack following unauthorized access to its network. For additional information on this topic, please refer to the paragraph

'Significant events of the year'.

Compliance risks

Tax risks and changes in fiscal regulations (C)

Distilled spirits and wines are subject to import duties or excise taxes in many countries where the Group operates. Many jurisdictions are considering excise tax increases. An increase in import duties or excise taxes could adversely affect profit margins or sales revenue by reducing overall consumption or encouraging consumers to switch to lower-taxed categories of alcoholic beverages. Furthermore, tax-related changes in any of the markets in which the Group operates, such as the effect of Brexit on trade between Europe and the United Kingdom or changes in import duties in the United States on alcoholic products originating from the European Union, could result in a rise in the Group's effective tax rate or lead to uncertain and/or unexpected tax exposure for the Group that could increase the Group's overall business costs.

The Group regularly reviews its business strategy and tax policy in light of legislative and regulatory changes and assesses the likelihood of any negative results of potential tax inspections to determine the adequacy of its tax provisions.

Risk of failure to comply with laws and regulations (C)

As the Group is exposed and subject to numerous different regulations, there is a risk that failure to comply with laws and regulations, and with Group policies, could harm its reputation and/or result in potentially substantial fines. To mitigate this risk, the Group has drawn up a Code of Ethics and laid down Business Conduct Guidelines. It also provides its employees with regular training on its global policies.

Internal assurance activities are continuously monitored and assessed with local management to improve the internal control system. Present in many regions across the world, the Group has also adopted a specific policy on human rights intended to mitigate any legislative shortcomings existing locally in that regard.

The Group has also implemented a global training programme on antitrust compliance, aimed at mitigating the risk of any breach of antitrust laws.

Through the Group Privacy and Data Protection (GPDP) department, the Campari Group is managing a project to align with the new European regulations on personal data protection (the 'GDPR' or 'Regulation'). In accordance with the new Regulation, a Data Protection Officer (DPO) has been appointed and an organizational model has been defined for the protection of personal data and to identify roles and responsibilities. As part of the project work, numerous training and awareness activities have also been carried out. At the same time, Campari Group has drawn up a series of policies to manage GDPR requirements and has also introduced a tool to manage and track the main activities required under GDPR to effectively demonstrate compliance with this Regulation.

Risks relating to legislation on the beverage industry and the application of import duties (C)

Activities relating to the alcoholic beverages and soft drinks industry, production, distribution, export, import, sales and marketing, are governed by complex national and international legislation, often drafted with somewhat restrictive aims. This necessitates monitoring of the economic risks arising from the increasing tension in global trade and the application by the United States of duties on alcoholic products from the European Union. Moreover, the requirement to make the legislation governing the health of consumers, particularly young people, ever more stringent could, in the future, lead to the adoption of new laws and regulations aimed at discouraging or reducing the consumption of alcoholic drinks. Such measures could include restrictions on advertising or tax increases for certain product categories. Campari Group is committed to constantly publicizing messages and models of behaviour associated with responsible consumption and serving of alcoholic drinks through its communication channels and constantly monitors any changes in the legislation applicable to the beverage industry. Any further tightening of regulations in the main countries in which the Group operates could lead to a fall in demand for its products.

Risk related to non-compliance with environmental regulations and policy (C)

Due to Campari Group's global presence, its operations are subject to environmental regulations imposed by

national, state and local agencies, including, in certain cases, regulations that impose liability without regard to fault. These regulations can result in costs or liability, including fines and/or environmental remediation obligations, which might adversely affect Campari Group's operations. The environmental regulatory climate in the markets in

which the Campari Group operates is becoming stricter, with a greater emphasis on enforcement.

The responsible use of resources and reduction of the environmental impact of the Group's production activities are, of course, practices that guide the Group's activities with the aim of pursuing sustainable development.

Campari Group has adopted an environmental policy aimed at reducing the environmental impacts that may be caused by the Group's activities. This policy, which is regularly reviewed to keep it in line with the nature and size

of the Group and its corporate objectives, applies to all company locations and divisions and is also shared with suppliers, funders and employees. The Group's industrial management has also set up a structure dedicated to

safety, quality controls on environmental pollution, waste and water disposal. The objective of this structure is to continuously monitor and update the Group's business activities based on the legislation in force in the individual

countries in which it operates.

While the Campari Group has implemented those initiatives, there can be no assurance that it will not incur substantial environmental liability and/or costs or that applicable environmental laws and regulations will not change or become more stringent in the future. Any increase in environmental compliance costs, and other related costs and fines could have an adverse effect on the Campari Group's business, prospects, financial condition and/or results from its operations.

Risks relating to product compliance and safety (C)

If any of the Campari Group's products are defective or found to contain contaminants, the Campari Group may

be subject to product recalls or other liabilities. Campari takes precautions to ensure that its beverage products are free from contaminants and that its packaging materials are free of defects by conducting extensive quality controls and having a worldwide quality team. In the event that contamination or a defect does occur in the future despite all precautions, this could lead to business interruptions, product recalls or liability, each of which could have an adverse effect on the Campari Group's business, reputation, prospects, financial condition and/or results

from its operations.

Although Campari has drawn up guidelines to be implemented if quality is accidentally compromised, such as in the event of any withdraw or recall of products from the market, and maintains insurance policies against certain product liability risks, if contamination or a defect occurs, any amounts that Campari recovers may not be sufficient to offset any damage it may sustain, which could adversely impact its business, results from its operations and/or financial condition.

Non-Financial Disclosure

This section addresses the requirements of the Dutch Civil Code, and of the Dutch Decree on Non-Financial Information (Besluit bekendmaking niet-financiële informatie), which is a transposition of Directive 2014/95/EU

'Disclosure of non-financial and diversity information' into Dutch law.

Global Sustainability Strategy

In 2020 the Campari Group has formalized its sustainability commitments into a roadmap, an agreed framework to focus investment and drive performance towards specific priorities within each area and that reflect the company's values and culture.

Our people-Inclusion, Equity&Diversity, learning and development, rewarding and engaging

• Inclusion, Equity&Diversity: a new strategy to foster inclusion, equity and diversity in the workplace with intentional commitment, supported by an internal multi-functional governance at all organizational levels. Monitoring the Group's progress through an internally developed Campari Group Inclusion,
Equity&Diversity Index, based on people survey-based and GRI Standard based Key Performance Indicators (KPIs), allowing the development of action plans in the field of Culture (focusing on education) and Power Acts (focusing on concrete initiatives).
• Learning Culture: introduce a new paradigm around personal and organizational development, based on pervasive growth mindset, a greatly enhanced learning offer, and a brand-new digital ecosystem to enable anytime/anywhere learning experiences through the Learning Distillery, a one-stop-shop for all Camparistas.
• Feedback Culture: foster a new company-wide 360° feedback practice, serving as a boost for both leadership development and individual engagement and growth. Complementing our sound talent management process, it aims at adding an extra layer of frequency, education, involvement, and purpose, powered by an agile tech platform.
• Rewarding and engaging through an Employee Stock Ownership Plan for all Camparistas.

Responsible practices-Education and involvement with regard to responsible drinking

• The Campari Group's Global Strategy on Responsible Drinking has been formalized in 2020, identifying internal and external initiatives to be implemented within the next two years.
• Educational sessions on responsible drinking for 100% of Camparistas, especially for new hires.
• Ad hoc and continuous training for the global marketing community with a deep dive on digital communication.
• Responsible serving project for bartenders to be leveraged at global level.
• Digital brands' campaigns on responsible drinking.

Environment

Energy and GHG emissions

• Reduce greenhouse gas (GHG) emissions from direct operations26 by 20% in 2025, by 30% in 2030 and from the total Supply Chain by 25% in 2030, using 2019 as a baseline.
• 100% renewable electricity for European production sites by 2025.

26 Scope 1 and 2.

Water

• Reduce water usage (L/L) by 20% in 2025 and by 25% in 2030, using 2019 as a baseline.
• Return 100% of wastewater from our operations to the environment safely.

Waste

• Zero waste to landfill by 2025.

Community involvement-Exporting best practices across key markets

• Strong commitment to work, education and culture will continue to be key for Campari Group.
• Best local practices will be exported in other geographies around the world.
• Continuous involvement in the world of art, by sponsoring major events and further developing iconic brand houses and the Campari Gallery.
• Strong support to business partners through activations and events, reflecting a commitment to playing a major role in the comeback of the on-premise channel.

Through the conduct of its business, Campari Group contributes to the achievement of 11 of the 17 Sustainable Development Goals (SDGs)27 established under the UN 2030 Sustainable Development Agenda, which promotes the active participation of all stakeholders (i.e.: private sector, public sector, institutions and local communities). In particular, the objectives shown in the table below were linked to the sustainability issues that constituted the starting point for carrying out the materiality analysis:

Objectives	Campari Group topics28	Campari Group commitments
Remuneration policies Relationships and initiatives for the community Activities of the Foundations	Exporting best practices across key markets • Strong commitment to work, education and culture will continue to be key for Campari Group • Best local practices will be exported in other geographies around the world Learning and development, rewarding and engaging • A new paradigm around personal and organizational development, based on pervasive growth mindset, a greatly enhanced learning offer, and a brand-new digital ecosystem to enable anytime/anywhere learning experiences: the Learning Distillery, a one-stop-shop for all Camparistas • A new practice, company-wide 360° feedback serving as a boost for both leadership development and individual engagement and growth. Complementing our sound talent management process, it aims at adding an extra layer of frequency, education, involvement, and purpose, powered by an agile tech platform • Employee Stock Ownership Plan for all Camparistas Education and involvement on responsible drinking • Educational sessions on responsible drinking for 100% of Camparistas, especially for new hires • Ad hoc and continuous training for the global marketing community with a deep dive on digital communication • Responsible serving project for bartenders to be leveraged at global level
Employee training and development Relationships and initiatives for the community Activities of the Foundations
Value generated and distributed to stakeholders Economic sustainability Job creation Diversity, equal opportunities and inclusion Training and employee development Human rights Recruitment, turnover and pension policies Talent attraction Remuneration policies Industrial relations Work-life balance Employee satisfaction Health and safety

27www.un.org/sustainabledevelopment/sustainable-development-goals/
28 The material issues for the Group are highlighted in bold as reported in the materiality matrix.

Health and safety Emissions Waste Water

Energy and GHG emissions

• Reduce greenhouse gas (GHG) emissions from direct operations (Scope 1 and 2) by 20% in 2025, by 30% in 2030 and for the total Supply Chain by 25% in 2030
• 100% renewable electricity for European production sites by 2025

Water

• Reduce water usage (L/L) by 20% in 2025 and by 25% in 2030
• Return 100% of wastewater from operations to the environment safelyour

Waste

• Zero waste to landfill by 2025

Water

Energy Renewable energy

Emissions Energy Water Waste Materials

Supply chain transparency and traceability Product quality

Food safety

Emissions Energy

Suppliers-Qualification and evaluation with respect to environmental criteria

Diversity, equal opportunities and inclusion Remuneration policies

Human rights

Diversity

• A new strategy to foster inclusion, equity and diversity in the workplace with intentional commitment, supported by an internal multi-functional governance at all organizational levels. Monitoring the Group's progress through an internally developed Campari Group Inclusion, Equity&Diversity Index, based on people survey-based and GRI Standard based Key Performance Indicators (KPIs), allowing the development of action plans in the field of Culture (focusing on education) and Power Acts (focusing on concrete initiatives)

Diversity, equal opportunities and inclusion Remuneration policies

Human rights

Indirect economic impact on communities Initiatives for the community

Activities of the Foundations

Business relations with responsible and transparent partners Relations with institutions

Projects and initiatives on sustainability

Exporting best practices across key markets

• Continuous involvement in the world of art,
by sponsoring major events and further
developing iconic brand houses and the
Campari Gallery;
• Strong support for business partners through activations and events, reflecting a commitment to playing a major role in the comeback of the on-premise channel.

Note on methodology

The Non-Financial Statement aim is to provide our stakeholders with non-financial information, illustrating Campari Group's sustainability strategy and main initiatives in 2020. This disclosure contains non-financial information about environmental, social and employment matters, as well as respect for human rights, anti-corruption and bribery issues, to the extent necessary to ensure understanding of the Group's business, performance, results and impact.

This non-financial disclosure is an extract from the Campari Group's Sustainability report and highlights the most relevant information of the year and the Group's more general approach to sustainability. The complete Campari Group disclosure on non-financial information is available in the Sustainability report. The Group's strategies,

policies, main impacts, risks and the related management approach for each of these issues are also described based on the principle of materiality.

The Dutch Statutory Auditor verifies the disclosure of this document according to legal requirements, while EY Italy verifies, through a limited assurance engagement, the Sustainability Report's compliance with the GRI Standards, the global standards for sustainability reporting. The Sustainability Report is submitted for limited assurance, in accordance with International Standard on Assurance Engagements (ISAE) 3000 Revised, by the independent auditing firm EY S.p.A..

This disclosure was prepared in accordance with the Dutch Civil Code, and with the Dutch Decree on non-financial information (Besluit bekendmaking niet-financiële informatie), which transposes Directive 2014/95/EU on the

'Disclosure of non-financial and diversity information' into Dutch law.

The table below shows the internal references to the chapter(s) or paragraph(s) of this Annual Report where the relevant aspects of the Dutch Decree are discussed in particular to ensure transparent and structured communication with our stakeholders.

Dutch Decree aspects	Internal reference-Chapter/paragraph
Business model	The value chain of our products; Overview of Campari Group's business included in Governance.
Policies and due diligence	Sustainability policies and governance; Corporate Governance.
Principal risks and their management	Risk management and Internal Control System included in Governance.
Thematic aspects
Environmental matters	Management of resources and environmental impact; Global Supply Chain medium-long term environmental targets; Energy efficiency and decarbonization; Water management; Waste management; Spills, Certifications; Logistics and sustainable distribution.
Social matters	The Foundations; Stronger Together - Campari Group and the Covid-19 pandemic; Creating value for stakeholders; Quality and food safety of brands; Responsible communications; Responsible serving; Responsible consumption: communications and promotional initiatives; Campari Gallery; Cinzano Archive; Campari and the cinema; Negroni Week.
Employee matters	Stronger Together - Campari Group and the Covid-19 pandemic; Campari Group and Camparistas: #StrongerTogether; Ever more, a continuous dialogue; Other tools for dialogue and engagement - Channels and initiatives; Inclusion, Equity and Diversity in the workplace; Human resources: learning and professional development; Remuneration system; Industrial relations; Camparistas' involvement with the environment, well-being and social activities: Health and safety in the workplace.
Respect for human rights	Sustainability policies and governance; Code of Ethics, Business Conduct Guidelines, Sustainability compliance; Employees and Human Rights Policy
Fight against bribery and corruption	Sustainability policies and governance; Whistleblowing; Model 231; Code of Ethics; Business Conduct Guidelines
Supply Chain	Sustainability policies and governance; Responsible sourcing; Sustainability compliance; Business continuity and enhanced supplier collaboration; Growing agave in partnerships with local farmers.

The materiality analysis established in 2017, on the basis of a comprehensive benchmarking comparison with competitors in the sector and of the results of a sustainability questionnaire distributed to the Group's entire

management, has been further refined. In 2018, bartenders were included among the categories of stakeholders that are most relevant to the Group. In 2019, adjustments were made in the wake of a focus group conducted under the aegis of the Campari Group Sustainability Committee. And lastly in 2020, the priorities were reconsidered in a year when the entire world population was affected by the Covid-19 pandemic, resulting in a strong impact also on the global economy.

Campari Group's Non-Financial Disclosure was prepared in accordance with the GRI Sustainability Reporting

Standards, the sustainability reporting framework set by the Global Reporting Initiative ('GRI'), establishing the

most advanced standard for sustainability reporting most widely used worldwide. The document complies with the In Accordance-core option of the GRI29, ensuring that at least one indicator for each material issue is disclosed.

As in previous years, in addition to the key performance indicators established in the GRI Sustainability Reporting Standards and the sustainability aspects covered by the statutory reporting requirements, Campari Group also reports certain additional qualitative and quantitative indicators that are particularly relevant for a multinational company operating in the spirits sector (e.g.: responsible marketing and serving, and communication practices), in accordance with the materiality principle.

29 For more information refer to GRI Content Index contained in the 2020 Sustainability report.

With regard to the financial data, the scope of the reporting corresponds to that of Campari Group's consolidated financial statements.

With regard to the non-financial information, the scope of the reporting encompasses the data of all Campari Group companies consolidated on a line-by-line basis for the period from 1 January 2020 to 31 December 2020 (2020 fiscal year); it thus excludes the information related to two companies: (i) Licorera Ancho Reyes y CIA

S.A.P.I. de C.V., and (ii) Casa Montelobos S.A.P.I. de C.V.. This is because the scope of the acquisition, which occurred at the end of 2019, includes the brands, the company's intellectual property and related inventories, not

the production and bottling facilities that are leased to third parties, whilst agave, the main raw material to produce mezcal, is sourced through third party agreements with major local growers to secure constant supply.

Champagne Lallier S.a.r.l. is also excluded, whose signing was announced on 5 May 2020 and whose production, close to 700,000 bottles in 2019, is not seen as impactful and therefore material for the purposes of this report.

Furthermore, given that it is a distribution company and does not therefore have production facilities, environmental data relating to the company Campari France Distribution S.A.S., formerly Baron Philippe de Rothschild France Distribution S.A.S., are also excluded from the reporting perimeter. Similarly, Tannico S.p.A., the leading e-commerce platform for wines and premium spirits in Italy, in which Campari Group today holds a 49% interest, is not included in the scope of consolidation.

Any data relating to previous years are reported for comparative purposes to allow performance to be assessed on a multi-annual basis.

Data collection and monitoring is managed through the Group's sustainability platform (Enablon) and this page

shows the scope of reporting, The scope of reporting also includes all the information related to headcounts (in the chapter 'Our people') and some environmental KPIs (in the chapter 'The environment') of the French company

Rhumantilles S.A.S., whose acquisition was announced on 5 September 2019; the company, which is based in

Martinique (France), will be integrated within Enablon from 2021.

With regard to 'The environment' chapter, the environmental data, including those relating to energy consumption

and emissions, do not include consumption in offices (except for the headquarters based in Sesto San Giovanni-Milan).

Enablon was initially adopted by the Quality, Health, Safety and Environment function in 2016, and then extended to all business units involved in sustainability reporting, notably Marketing, Legal, Human Resources and Public

Affairs, in 2017. Data collection is undertaken locally and double-checked at country and regional levels. Additional sample checks are carried out by the Group's heads of functions and by Internal Audit to ensure maximum data

consistency. The adoption of the platform enables us to monitor our performance more effectively and to establish internal targets for overall improvement in the medium to long term.

Campari Group's Sustainability reports are available on the Group's website at:www.camparigroup.com,in the 'Sustainability' section.

Campari Group's identity

About us

Campari Group, a leading company in the global branded spirits industry, was founded in Milan in 1860, when Gaspare Campari created the world-famous red aperitif.

With a portfolio of more than 50 premium and super premium brands owned, marketed and distributed in over 190 countries worldwide and, with leadership positions in Europe and the Americas, Campari Group is now the sixth largest branded spirits30 group in the world and employs approximately 4,000 people.

With a corporate domicile in the Netherlands and headquartered in Sesto San Giovanni (Milan), Italy, on 31

December 2020, the Group owned 22 manufacturing plants and had a proprietary distribution network in 21 countries. The shares of the parent company, Davide Campari-Milano N.V. (Reuters CPRI.MI - Bloomberg CPR IM), have been listed on the Italian Stock Exchange since 2001.

Our world

The defining aspects of Campari Group's culture and the constituent elements of its identity are: Essence, Mission,

Values and Behaviors.

• Essence

The Group essence, 'Toasting Life Together', shows the fundamental role that our people play in ensuring the success of the business. For this reason, Campari Group's people ('Camparistas') are offered the opportunity to continuously develop the skills they already have while also acquiring new ones. 'Toasting Life Together' also

celebrates the positive role that our brands and drinks play in enhancing sociable occasions, encouraging people to get to know each other, and celebrating life in a positive and responsible way.

• Mission

'The smallest big company in the spirits industry building iconic brands and superior financial returns together with inspired and passionate Camparistas'.

• Values
- ❖ Passion-Passion is a defining trait of our way of thinking and acting within Campari Group. We are passionate about our sector, our work and our brands. We work as a team and always give our utmost to ensure that our consumers have positive experiences with our brands day after day.
- ❖ Integrity-We recruit, develop and reward people who work transparently. For us, integrity means living responsibly as part of the organisation and treating all our stakeholders with the utmost respect; it also, and most importantly, means ensuring that fairness, honesty and consistency underpin our way of doing business and guide the professional life of all Camparistas.
- ❖ Pragmatism-In all functions, and at all levels, we encourage and reward a pragmatic attitude towards resolving problems and tackling challenges. We eschew bureaucracy and firmly believe in a practical approach. Simplicity underpins our actions. Our unique structure allows us to take agile and customer-focused decisions, while benefiting from synergies and the sharing of know-how across the whole Group.
- ❖ Together-'Together' is our team philosophy. It is the common thread that connects the nature of what we
  do with how we do it; it involves the joint efforts of Camparistas (including customers and consumers) around the world, working passionately on every brand and every cocktail that is served. Together we tear down silos, break down every cultural, organisational and geographical barrier, and all move in the same direction to achieve our common goal.
• Our Behaviors
❖ Be humble and hungry-'Humble and Hungry' means continuously putting ourselves to the test, stepping out of our comfort zone, being open to change, fixing our mistakes and learning from them, and continuing to do the things we do but striving to do even more, and to do it better.

❖

Respect others and the planet-Campari Group has always supported responsible and sustainable behavior, which it considers to be of paramount importance for the Group's growth. Sustainability, which runs through all our business activities, is part of our DNA. The path we have followed over the last few years has allowed us to achieve a greater level of maturity and awareness of the fundamental role that the business world can, and must, play in society.

❖ Keep it simple and do more with less-We eschew bureaucracy and firmly believe in a practical approach.
Simplicity underpins our actions. Our unique structure allows us to take agile and customer-focused decisions, while benefiting from synergies and the sharing of know-how across the whole Group.
❖ Embrace the challenge and drive the change-We are a Group that evolves and changes rapidly, and which operates in a volatile and highly dynamic competitive environment. Against this backdrop, each day brings new challenges and opportunities for us. To contribute to the Group's success in the context in which we operate, each Camparista must embrace the challenges that arise and drive change. Staying within the safety of our comfort zone and defending the status quo is not a viable option.
❖ Build more value together-We need to tear down silos and all move in the same direction, better synchronising our capabilities and strengths, in order to accelerate growth and optimise costs. The only way to unlock the potential of our organization is to adopt a more synchronized approach to the way we do business and focus on our priorities. All Camparistas can play a key role in creating our iconic brands and generating better financial results, by consistently acting in accord with our Values and Behaviors, and overcoming every obstacle.

Campari Group: a history of entrepreneurship

The Group made its first acquisition in 1995, marking the start of a strategy that still today combines 50% organic growth with 50% external growth. Since then, each brand that has joined the Group has brought with it a unique history and identity.

• over 30 acquisitions since 1995 for a total value of over €3.2 billion;
• over 10 disposals since 2013 and divestment amounting to around €500 million since 2016.

Campari Group worldwide

Since 2004, Campari Group, headquartered in Sesto San Giovanni (Milan), has been developing a proprietary direct distribution network, which has grown in 16 years from 5 to 21 markets worldwide and represents over 90% of total sales. The Group brought the bottling activities in the core markets of the US and Australia in-house sector and, since 2004, has been increasing the number of production sites around the world from 8 to 22 at 31

December 2020: Italy (4), Greece, Scotland, Jamaica (3), France (5), Australia, Mexico (3), United States, Canada, Argentina, and Brazil.

The distribution subsidiaries in 2004 were in Italy, Germany, United States, Brazil and Switzerland.

The expansion since 2004 has encompassed Austria, China, Argentina, Mexico, Ukraine, Belgium, Luxembourg, Australia, Russia, Jamaica, the UK, Spain, Canada, Peru and South Africa.

For more information on the Company's sociogram, please refer to the Campari Group consolidated financial statements at 31 December 2020.

The Foundations

• Fondazione Campari

Fondazione Campari was founded in 1957 by Guido Campari and Angiola Maria Barbizzoli Migliavacca.

Recognized as a charitable trust by the Presidential Decree of 10 July 1957, it began its activities towards the end of that year. The first donation was made on 8 November 1957.

Fondazione Campari is a private law foundation subject to the rules of the Italian Civil Code. Pursuant to its Statute, the purpose of the Foundation is to pursue social solidarity projects and, in particular, to promote assistance, training, education and charity in favour of all deserving individuals. This purpose may be pursued in

Italy and/or abroad and mainly benefits employees and former employees of Davide Campari-Milano N.V., of the companies or entities that control it or are controlled by it ('Campari Group'), of their families and of all those who have contributed to the success of the 'Campari' name. Fondazione Campari may also pursue social solidarity

purposes and, in particular, assistance, training, education and charity in favour of persons other than Campari Group employees.

Despite the complexities of the year 2020, Fondazione Campari did not stop its philanthropic support work, continuing to be close to Campari's members and their families all over the world; in particular, the Foundation

supported two major macro-projects: the Liceo Malpighi school in Bologna with a wide-ranging series of initiatives, and the Associazione Cometa educational institution.

In particular, for the year 2020 Fondazione Campari provided philanthropic aid amounting to a total of €303,918.00.

As regards Camparistas, 66 requests out of 69 were accepted, for a total value of €228,918.00, broken down as

follows.

Type	Economic value (€)
Mortgage subsidies	€102,000.00
Scholarships and awards	€63,500.00
Nursery/kindergarten fees	€19,500.00
One-off applications-Italy	€17,800.00
One-off applications-abroad (Mexico and South Africa)	€26,118.00
Total	€228,918.00
• J. Wray&Nephew Foundation

J. Wray&Nephew Foundation (JWNF) works mainly to promote social inclusion, culture and education in Jamaica, developing interventions for the benefit of the local community with the support of Camparista volunteers.

Together, Camparistas and communities are working to realise the Foundation's mandate of 'Transforming lives and communities for a better Jamaica'.

In 2020, JWNF carried out fifteen targeted interventions under its three main pillars of education, social inclusion and cultural expression, for a total value of JMD50,894.91 (€293,039.75), directly impacting 61,661 persons. The

main programmes and projects developed within each area are shown below.

❖

Education

- JWN Foundation's Scholarship Awards Programme 2020
- Back 2 School Support
- Read Across Jamaica Day 2020
- Skills Training

❖ Social inclusion

- International Women's Day Activation
- Social Fair-JWN & Ministry of National Security - St. Elizabeth Community Outreach
- Meal Subsidy Programme for Online Learning in Schools
- Council of Voluntary Social Services (CVSS)
- 195 Trees for 195 Years
- Delivering the Spirit of Christmas - The Social Distancing Edition

❖

Culture

- 195th Anniversary Mural on Henley Road, Kingston

• Campari Foundation Mexico

Fundación Campari was created in Mexico in 2016 with the aim of supporting education and health and combating poverty, especially in the Arandas region, where Campari Mexico's production facility is located. The two main projects promoted by Fundación Campari México are the 'School Kits' program and the 'Espolòn School', an

educational programme for distillery employees. The Mexican distillery was recognised as a study centre by local institutions and has consequently been granted authorisation for external teachers to teach officially recognised lessons there. Lastly, the Fundación promotes various projects in support of the local community.

Sustainability for the Group

As its business grows, Campari Group constantly comes across new opportunities to generate positive economic, social and environmental impacts. A culture of ethics permeates the entire company, ensuring that every business is managed with probity and integrity.

Campari Group's approach to sustainability identifies the following four areas through which the Group's

commitment to creating value in each business area is structured:

• our people;
• responsible practices
• the environment;
• community involvement.

During the year, the Group reconsidered its sustainability priorities, defining a short-to-medium-term roadmap to which all major global functions contributed, and this was validated at the end of the year by the top management.

The roadmap led to key actions being defined in the three areas of sustainability considered to be the most relevant at this time for a company of the spirits sector: our people, responsible drinking and the environment. In the area of people, particular attention was paid to the themes of inclusion, equity and diversity, an ethical and moral imperative for a multinational company in which positive and productive interaction, cooperation and synergy between people, cultures and experiences drives business growth, value creation and organizational performance. Based on these considerations, the Group drew up its Inclusion, Equity&Diversity strategy, which determines the approach and provides a framework for everyone within the company to be empowered and encouraged to contribute to our journey and support a culture of inclusion. Regarding the responsible drinking area, a global strategy with internal and external short and medium-term initiatives has been established, with the aim of raising awareness and educating the company's key stakeholders, starting with Camparistas, bartenders and consumers, about correct and responsible consumption of the Campari Group's products and alcoholic

beverages in general. Finally, in the environment area, particular importance has been given to energy, water and waste, for which reduction and efficiency targets have been set for 2025 and 2030, which will be made possible through the implementation of specific global projects. For more details of the Group's commitments in relation to

these three areas of focus, please refer to the following chapters.

Stronger Together-Campari Group and the Covid-19 pandemic

Right from the early stages of the pandemic, the Campari Group's priority has been to protect the health and safety of its employees. The Group has adapted its way of working, set up dedicated teams to closely monitor the situation and to proactively adopt all the necessary health and safety measures, as well as to guarantee business continuity. Where possible, the Group has adopted smart working and introduced new work and safety protocols in plants and distilleries.

At the same time, in order to continue to build and strengthen the team spirit and sense of belonging of Campari Group's employees, or Camparistas, as they are known, a wide range of communication and internal engagement activities have been promoted on internal channels, thus creating a virtual 'piazza' (forum) where employees have been able to share, experience and live the culture of 'togetherness'.

With the outbreak of the first wave of the emergency in Italy, Campari Group wanted to make its own contribution to the healthcare system in Lombardy: first with a donation to the public healthcare institution ASST Fatebenefratelli Sacco, then, by donating alcohol for the production of hand sanitizer which was then distributed to a number of hospitals in Lombardy and to a small town near Bergamo, Ambivere, which was among the areas mostly impacted by the pandemic. The overall donation was approximately 45 thousand bottles. A major effort was also made to support the hospitality sector to help face the Covid-19 emergency, with the donation of US$1 million to the non-profit organisation Another Round Another Rally, launching the campaign 'Shaken Not Broken' which started in the US and was picked up by other countries where the Group operates. Numerous activities have also been undertaken to support other local communities in countries such as Jamaica, Canada, Brazil, Argentina, Australia, France and Belgium.

In the second wave of the pandemic, Campari Group relaunched the 'Shaken Not Broken' campaign in the US with an additional donation of US$100,000 to drinks industry non-profit organisation Another Round, Another Rally and in UK, inviting British companies to devolve part of their unused budgets for corporate parties to the relief fund set up for struggling hospitality workers and which offers financial assistance, mental health and well-being support, as well as grants for education and training. With the relaunch of the 'Shaken Not Broken' campaign the

Group also donated US$50,000 to Canada's Bartenders Benevolent Fund.

Regular updates on the Group's initiatives in the fight against Covid-19 can be found on the official website:Stronger Together | Campari Group

Sustainability policies and governance

As it continues to split up its business structure into divisions and expand its geographical and market reach, Campari Group has had to formalise its key principles in documents that constitute the pillars of our sustainable way of doing business.

The values and lines of conduct that inspire the activities of each Camparista and the entire Group are set out in the Code of Ethics, the latest version of which was approved by the Board of Directors of the Parent Company on 8 May 2018. The Code reaffirms the principles of fairness, loyalty and professional integrity that form the basis of the work and behavior of those operating in the Group, both in terms of internal relations and in terms of relations with third parties (the Code of Ethics is available atwww.camparigroup.com).

To ensure compliance with the Code of Ethics and its correct interpretation pursuant to Legislative Decree 231/2001, a Supervisory Body was established, appointed by the Board of Directors, with autonomous operational and control powers. Any violations or conduct not consistent with the Code may be reported anonymously to the Supervisory Body through Campari Safe Line, the whistleblowing channel available to Camparistas and external stakeholders, accessible through different channels (telephone, e-mail, mail, fax or online platform) and is available in several languages.

In addition to the Code of Ethics, the Business Conduct Guidelines also aim to ensure the utmost integrity in professional life. The principles set out in the document, which is available to all Camparistas and can be viewed on the Group's internal portal, concern the following five potentially sensitive areas:

- gifts and entertainment;
- use of social media;
- confidential information;
- responsible drinking;
- mutual respect.

Specifically with regard to anti-corruption and bribery, in 2018 the Group conducted a corruption risk analysis involving 26 foreign companies. The objective of the analysis was to map the regulations applicable at local level and to further examine the companies' internal control systems for processes potentially at risk of corruption, including: management of relations with third parties (public and private), management of gifts and entertainmentexpenses, lobbying activities and human resources management. Following this analysis, certain specific areas for intervention were identified. The Group has therefore established a multi-year process to strengthen its compliance management system, particularly in the areas of anti-corruption, anti-trust, data privacy and conflicts of interest.

In Italy, in particular, pursuant to Legislative Decree 231 of 2001, the 231 Model, which governs specific control systems, was approved by the Board of Directors. The Model is aimed at preventing the crimes covered by the aforementioned decree and in particular to prevent crimes against the public administration, corporate and financial crimes and crimes committed in violation of workplace health and safety regulations.

The Company has appointed a single supervisory body to verify the effectiveness of the Model and to update it. The main tools for mitigating corruption risk are the Code of Ethics, the Business Conduct Guidelines and ongoing training of Camparistas to keep them regularly updated on the Group's policies. In particular, relations with public and private entities are regulated in the Code of Ethics as follows:

- - -

it is absolutely forbidden to promise or offer public officials, employees or other representatives of the public administration payments or other benefits in order to promote or favour the Group's interests; it is absolutely forbidden to promise or offer employees or other representatives of institutions, political parties, trade unions and associations payments or other benefits in order to promote or favour the Group's interests; in all cases, it is forbidden to accept gifts or favours, the value of which, taking into account the circumstances under which they were offered, could have even a slight impact on the selection of supplier or counterparty, or on the terms and conditions of a contract.

The adoption of Model 231 as well as subsequent additions or amendments are communicated to all employees, including members of the Board of Directors and the Board of Statutory Auditors, with the link from which the text of Model 231 can be downloaded clearly displayed on the Company's website. An information set is made available to new employees, including, among other documents, the Code of Ethics, Model 231 and the Italian national collective labour agreements (contratti collettivi nazionali di lavoro-CCNL). The Model is also communicated to the Group's business partners through the Code of Ethics and the Supplier Code. This information set is intended to provide the knowledge that is deemed to be of primary importance for the company. The content and delivery of training activities aimed at raising awareness of the regulations contained in the Decree are tailored to the different roles of employees and the level of risk in the area in which they work, and also take into account whether or not they act as representatives of the company. Violations of the Code of Ethics may result in termination of the relationship of trust between the Group and the Recipients, with the consequences for the employment/collaboration relationship specified in current legislation and collective agreements. In 2020, there were no reports of corruption incidents.

Since 2013, Campari Group has had a Quality, Health, Safety&Environment (QHSE) policy that governs and protects the environment, health and safety of its employees and consumers as well as the quality and food safety of products. This policy, which is regularly reviewed to keep it in line with the nature and size of the Group and its corporate objectives, applies to all company locations and divisions. These are responsible for amending the policy to align with the specific characteristics of quality, health, safety, environment and sustainability of the location concerned. The policy is also shared with all suppliers, funders and employees, and is published on

Campari Group's website31.

In 2017, in accordance with the provisions of the Decree on Non-Financial Information , a policy on human rights and personnel management was drafted and signed by the Group Officers. The issue of respect for human rights is deeply rooted in our organisation, and, in line with the principles already expressed in the Code of Ethics, by drafting a specific policy, the Group defined its position with respect to issues related to human rights, working conditions, training and to the employees' well-being and formalised its commitment to playing an active role in the protection of human rights within its sphere of influence. The Employees'&Human Rights Policy, which applies to all Group members, was communicated to all Camparistas, in multiple languages, using the main internal communication tools and made public in the Governance and Sustainability sections of the Group's website32. Campari Group checks for the compliance of all its operating units with its human rights commitments by monitoring and analysing its grievance mechanisms as appropriate. In 2020, there were no reports of human rights violations. The Group also commits to a continuous focus on ensuring the effectiveness of its whistleblowing procedures for reporting any illegal behavior and/or irregularities through the Campari Safe Line. The principles and provisions of the Code of Ethics and the Employees and Human Rights Policy also apply to the Group's suppliers. Campari Group also supports the United Nations Universal Declaration of Human Rights and the

International Labour Organisation's Declaration on Fundamental Principles and Rights at Work. The Group ensures legal compliance with national legislation on human rights in the countries in which it operates. In the

31www.camparigroup.com/en/sustainability/qhse-quality-health-safety-and-environment/qhse-policy
32www.camparigroup.com/en/governancewww.camparigroup.com/en/sustainability

event of any divergence between the content of our policies and national regulations, the Group always apply the most stringent requirements. The risk of failure to comply with laws and regulations, including our internal policies, is continuously monitored for all Group's legal entities and organizational activities in all its geographical regions.

The Supplier Code, implemented globally in2013 and revised in subsequent years, summarizes the principles and founding values that underlie every business relationship. By signing this document, each supplier of materials and components for production gives its assurance that its operations comply with the ethical requirements of Campari Group, helping to establish transparent, lasting and profitable relationships. The Group will continue to extend the range of suppliers to which the Supplier Code applies, including non-product-related suppliers.

In 2020, the Board of Directors prepared and adopted a diversity policy in accordance with best practice provision 2.1.5 of the Dutch Corporate Governance Code, establishing the company's commitment, setting objectives, and

putting in place monitoring and reporting procedures in order to guarantee that the differences in skills and backgrounds of the Board's members reflect the diverse nature of the environment in which the Company and its

stakeholders operate, thus improving the Company's effectiveness through diversity of approach and thought.

A new Policy on the Use of Electronic Communications and Information Systems has been issued, demonstrating the Company commitment to promoting the correct use of IT and electronic communication systems in order to protect its IT assets and, in general, all its stakeholders; the Privacy Policy applying to the processing of employees' personal data was also updated.

Finally, a renewed Internal Policy on Responsible Alcohol Consumption consistent with the Group's responsible commitments and practices was released and shared internally. The policy is aimed at all Camparistas and those who work with the Campari Group to promote its brands (e.g. agents and Brand Ambassadors) to ensure that every employee always promotes responsible and measured consumption of alcoholic beverages, both in and out of the workplace, by encouraging and practicing responsible behaviors and lifestyles. Proper training will be provided to all Camparistas in 2021.

Creating value for stakeholders

Campari Group's goal is to create and share long-term value with stakeholders. Firstly, the economic value generated and distributed provides an indication of how wealth is created, on the other there are plenty of intangible resources and initiatives that derive from the Campari Group's Global Sustainability roadmap33 and

contribute to the value creation processes. In this regard, community engagement and involvement with the local territory are of fundamental importance, as described in the above and subsequent chapters.

• Economic value generated and distributed34:

(€ million)

• Economic value generated by Campari Group:
Revenues from sales: +€1,772.0 million;
Financial income collected (interest income): +€6.2 million;
• Economic value distributed by Campari Group:

- Operating costs:

• cost of sales: -€746.1 million (of which -€74.9 million for personnel costs);
• Advertising and promotional costs: -€309.8 million (of which -€3.0 million for personnel costs);
• Overheads: -€394.2 million (of which -€234.2 million for personnel costs);

The previous costs include total personnel costs of +€312.1 million, taxes other than income taxes of - €13.2 million, and donations and gifts of -€3.4 million;

- dividends distributed: -€62.9 million;
- financial expenses paid (interest expenses paid)35: -€30.1 million;
- direct taxes paid: -€119.7 million

During 2020, the economic value generated by the Group was +€1,778.3 billion, while the economic value distributed during the year was +€1,662.8 billion.

33 For more information on the Global Sustainability roadmap, refer to the paragraph 'Sustainability for the Group'.
34 The values are taken from the Group's Income Statement, classified by function. With regard to financial charges and income, dividends, and direct taxes, the cash principle rather than the accruals principle was applied.

35 Starting from 2019 the financial charges include the notional interest payables for leases, following the application of IFRS 16-'Leases'.

Also considering the amortization of €78.0 million, and the write-downs of fixed assets, provisions net of utilizations: €11.5 million, the value retained, given by the difference between the economic value generated and the economic value distributed, was equal to +€204.9 million.

Our stakeholders

The following categories of stakeholders have been identified in the course of conducting business, with which the Group maintains an ongoing dialogue.

Stakeholder ConsumersBartendersLocal communitiesPressCamparistasSuppliers, distributors commercial partners

andCompetitorsShareholders, analystsinvestorsandTrade associationsTrade unionsInstitutionsSchools and universitiesEngagement and channels of dialogue

Market research and customer satisfaction; tests and focus groups; social media; company websites; events.

Campari Academy courses; Campari Academy Truck; Campari Barman Competition; events; sustainability questionnaire.

Corporate volunteering; Negroni Week; charity activities for NGOs; Covid-19-related supporting initiatives; visits to Galleria Campari; contributions to external shows and exhibitions.

Press releases and PR material; websites; preparation and coordination of interviews with senior management; events.

Biennial survey on internal morale (Great Place to Work 2018); internal and external training courses; performance appraisal; internal communication tools (press review, intranet, mailing);

'Yammer' internal social network; internal events for

Camparistas (such as guided tastings, lunch in the Galleria, product tastings); business meetings; management committees.

Supplier Code; Sedex; co-product development; innovation projects; business meetings; third-party verification; validation and certification of documents and reports.

Participation in sector association conferences.

Shareholders' meeting; management reports, press releases and investor presentations; analyst calls, investor meetings, road shows and investor conferences; dedicated email addressinvestor.relations@campari.com.

Regular meetings; preparation and sharing of projects and best practices; participation in meetings and activities of associations.

Collective and supplemental bargaining; company union representatives; conferences.

meetingswithParticipation in national and international conferences on issues facing the industry.

Development of projects in partnership; graduate programmes; company testimonials at educational institutions; guided tours for students at Galleria Campari; company testimonials.

The value chain of our productsMateriality analysis

Key issues

Product quality and safety; transparency of information; responsible communication.

Professional, high-quality and responsible serving.

Investments and aid for the community; social and environmental impacts generated; job creation.

Timely and transparent communication, information/statements on the relevance of sustainability issues and their impact on the company's strategy, targets and activities prepared, involvement of top management in business sustainability related issues.

Business climate; career development and growth; remuneration and incentives; training; work/life balance; corporate welfare; equal opportunities; health and safety at work; internal communication.

A solid and transparent negotiating relationship that is subject to continuous checks; contractual terms and conditions; order planning; compliance with Campari Group policies.

Protection of sector interests; promotion of responsible consumer behaviors and models.

Dividends, stock performance; investor relations; capital base.

Protection of sector interests; promotion of responsible consumer behaviors and models.

Ongoing dialogue and fulfilment of obligations arising from collective bargaining with the trade union associations.

Transparent communication; compliance with laws and sound business management.

Partnerships and projects; financing.

Materiality analysis is a useful exercise for identifying and prioritising the most important topics for the Company that enable the organisation to create value for itself and for the society in which it operates.

The process of creating the materiality matrix is described below.

After sending the 'Sustainability Survey' to over 500 Camparistas in 2017, and having established sustainability as the eighth strategic pillar, the Group again involved corporate management at the Group's 2018 Convention.

The participants, who were split into themed tables, took part in workshops to identify the most important issues for each area of business (i.e.: diversity, transparency, safety and culture). The findings were also the starting point for defining global sustainability projects to be implemented across the Group. These projects were approved internally by the Leadership Team during the year.

Moreover, in 2018, the company again updated the materiality matrix, involving external stakeholders for the first time. We sent a sustainability questionnaire to the customers and bartenders with whom we work and/or have dealings, receiving replies from over 700 users.

In 2019, the matrix was further revised and refined with a view to rationalising priority issues with a focus group created within the Sustainability Committee and composed of the managers of the main corporate functions. This exercise has led to more effective consolidation and a better definition of the areas and topics.

The events of 2020 necessarily led us to review the matrix, especially in light of the two events that most impacted our business during the year: the Covid-19 pandemic and the malware attack we suffered in early November. In addition, the process of developing a Sustainability roadmap, approved by the Leadership Team, led us to identify material issues by prioritising them and to define short- and medium-term initiatives on which the Group will focus particularly from 2021. The updated materiality matrix was validated by the members of the Sustainability Committee in December 2020.

In addition to the contributions received, the preliminary external analysis, such as the analysis of the media, the sector regulations, the aspects highlighted by the Dutch Decree on Non-Financial Information and a benchmarking of the companies operating in the alcoholic beverages sector, also provided another useful tool to determine the relevance of sustainability issues.

In accordance with the GRI Sustainability Reporting Standards, according to the materiality principle, each issue must be assessed and prioritized based on the magnitude of its economic, environmental and social impacts on the organization or based on its ability to influence stakeholders' choices and decisions.

The core sustainability areas for Campari Group are shown in the diagram below.

Legend

Environment

Social

Governance

The main changes with respect to the materiality matrix validated in 2019, concern the inclusion of the theme 'Job rotation' in the broader theme 'Training and employees development'; the elimination of the theme 'Indirect economic impact on communities' because it was assessed as non-material; the inclusion of the two material themes 'Voluntary consumer information about the technical characteristics of the product' and 'Voluntary consumers information about safe consumption' under the broader reference 'Transparency to consumers'.

We confirm the particular importance of those issues most directly related to the product, from 'Quality' and 'Food safety' to 'Responsible drinking', given the sector in which the Group operates. It is also important to emphasize

the growing importance of issues related to the development, growth and satisfaction of employees, further demonstrating the value that we attribute to the people behind Campari Group, who are fundamental to developing our brands and achieving our objectives. In particular, during the year the Group launched a global

'Inclusion&Diversity' project, the first actions will be implemented from 2021. With regard to the Environment,

priority has been given to 'Energy', 'Water' and 'Waste', in relation to which specific projects and efficiency targets have been defined. 'Economic sustainability', a key issue for any sound business, proved to be even more important in this year with the pandemic having caused serious economic impacts on companies around the world. Moreover, 'Data privacy and cyber-security', already a top priority for us, became an issue on which the company had to focus extensively following the malware attack at the end of the year.

Finally, it is important to highlight that all the issues resulting from the materiality assessment are being taken into account by the Group not only in terms of disclosure of the information reported in the Sustainability Report, but also, more operationally, through specific projects, some of which are already under way.

Our people

As the first and foremost ambassadors for Campari Group, our staff, our 'Camparistas', embody our corporate values and are essential to the Group's growth. This is why, as a mean to reward Group employees globally, team spirit and dedication of all Camparistas and incentive their active participation in the Company growth, an

Employee Stock Ownership Plan ('ESOP') will be rolled out in 2021. This is a breakthrough reward and engagement program to allow Camparistas to become company shareholders, awarding their culturally strong sense of belonging. All permanent employees of Campari and its subsidiaries who have a minimum seniority at the Company or any other company of the Group, with the exception of employees appointed as members of the Board of Directors, will be enrolled with an initial grant of free shares equal to one month of gross base salary by 1 July 2021 and the opportunity to voluntarily contribute with Company matching shares after 3 years of vesting36.

At 31 December 2020, the total workforce consisted of 3,79337 people, of whom 3,651 had a permanent contract. Company population by region, gender and professional category:

2018

2019

2020

Region and gender

Permanent Temporary

PermanentTemporary

Full-time Part-timeFull-time

Total Full-timePart-time Full-time

Total

Asia-Pacific Women Men

Europe, Middle East and Africa Women

Men

North America Women

Men

South America Women

Men Total

200 81 119 1,385 522 863 1,511 534 977 376 120 256 3,472

5 5 - 51 43 8 2 1 1 - - - 58

13 3 10 35 20 15 102 37 65 1 - 1 151

218 89 129 1,471 585 886 1,615 572 1,043 377 120 257 3,681

216 84 132 1,519 567 952 1,497 539 958 352 124 228 3,584

8 8 - 48 43 5 6 2 4 - - - 62

9 233
3 95
6 138
73 1,640
22 632
51 1,008
59 1,562
32 573
27 989
1 353
- 124
1 229 142 3,788

214 84 1301,693 667 1,026 1,327 506 821 339 120219

237 101 136 1,824 739 1,085 1,391 529 862 341 121 220 3,793

10 10

64 47 17 4 1 3 0

11 6 5 65 24 41 60 22382 11

2 1 1 2 1 1 0

3,573

138

Campari Group and Camparistas: #StrongerTogether

In 2020, even more than in the past, the ongoing dialogue between Campari Group and Camparistas all over the world was reinforced, responding to the increased physical distance imposed by the global pandemic. While taking all the necessary actions to ensure the safety of all its employees, the Group intensified its efforts to keep Camparistas informed and connected.

Several internal communications and engagement initiatives were developed and launched globally around the concept of Stronger Together. Leveraging its internal communications channels, such as Yammer (the corporate

36 In the context of an employee stock ownership program, the vesting period is defined as the amount of time an employee must work for a company in order to reach full ownership of the shares of the company stock.

37 In 2020 the Group also employed 30 interns, to be added to the total workforce, but excluded from the scope of this Report, as required by the GRI Sustainability Reporting Standards.

social network), where, a virtual 'piazza' (forum) was created, Camparistas could keep on sharing and living the culture of 'togetherness'.

Aimed at reassuring and guiding on the strategic priorities at a time of uncertainty and disruption, the plan included regular updates through the voice of the CEO on how the Group was responding to the health emergency around the world, sharing a message of empathy and closeness to Camparistas Added to this, content, such as cocktail building tutorials, yoga classes, reading suggestions, and calls to Camparistas to connect and share their hidden talents, was published to engage the community and promote a friendly team spirit.

Ever more continuous dialogue

Not only were internal communication efforts and executive involvement reinforced, but a two-way dialogue, fundamental to check in with Camparistas and respond to their needs, was promoted. Covid-19 led to major shifts in the workplace, which could lead to critical gaps in the employee experience, with serious implications for people well-being.

In 2020 more than ever, it was critical to connect with Camparistas' feeling and concerns on their contingent situation and upcoming future, so that more effective measures could be taken to support them.

One of the major shifts driven by the global pandemic was the need to transition to remote working and working from home wherever possible to guarantee employees' and stakeholders' health and safety. Although the Group had implemented global smart working policies in the recent past, Camparistas were not used to working as part of such an extensive remote workforce. Several training initiatives and information material were deployed to deep-dive in specific areas, such as how to manage teams and projects using remote, smart working practices, and much more.

In addition to the above, the Group promoted the Covid-19 Pulse Survey in May 2020, sent to every Camparista working from home. The participation in the initiative was remarkable and its results were highly encouraging for

Campari Group's efforts proving the worth of the direction taken by the Company.

Covid-19 Pulse Survey results38:

Workforce support:
Clarity of expectations while working remotely	Mutual support among team members	Access to information for health & well-being benefits
86%	92%	89%
Managers support:39
How much people manager felt they had what they needed
84%
The outcome above indicates the percentage of favourable responses ('Agree' or 'Strongly Agree')
Clarity and effectiveness of communication:
Clarity of the communicationsCompany'sactionsin	Communications' clarity on what Camparistas need to do in response to COVID-19	Communications from Campari Group has conveyed the Company's support and closeness to its people, making me feel part of a community
85%	94%	95%
The outcomes above indicate the percentage of favourable responses ('Very Clear' or 'Extremely Clear')	The outcome above indicates the percentage of favourable responses ('I Agree' or 'I Strongly Agree')
Leadership & tone at the Top:
Confidence in Senior Leadership to make the right decisions	Senior Leadership's consideration Camparistas' safety and well-being of
86%	94%
The outcomes above indicate the percentage of favourable responses ('Very Confident' or 'Extremely Confident'; 'Moderately Considerate' or 'Extremely Considerate')

2020 was also the year of the biennial Global Camparista Survey-the worldwide engagement survey since 2008-now in its 7th edition.

The survey was conducted by Campari Group for the third time in a row in partnership with the Great Place to Work® Institute, the global authority on workplace culture that has undertaken pioneering research on best workplaces for over 30 years. The Great Place to Work® Trust Index© Survey is based on a proven methodology, identifying the element of 'Trust' as the core of any successful workplace culture. It measures a wide variety of aspects across all demographic groups within the company, providing actionable insights, sound external benchmarks and enabling the Group to be a great place to work for all.

38 Based on 2,040 responses of employees working from home.
39 Based on 654 people managers' responses.

Camparista Survey Distribution:

- 3,411 Invitations
- 3,196 Responses
- 94% Response rate
- Period: October 2020
- Online questionnaire

The Global Camparista Survey involved all Camparistas with a permanent contract who joined the company before July 2020, be they office or field-based staff or plant and distillery workers.

The Response Rate of 94% was, in itself, a declaration of Camparistas' passion and engagement, but the results also showed an important advancement across all areas for improvement identified.

Overall satisfaction: Taking everything into account, I would say this is a great place to work -83% (+3pts as compared with 2018)

Campari Group's 2020 results against benchmarks:

We have seen steady growth across the five GPtW Dimensions since the first Camparista Survey in partnership with Great Place to Work®. The investments made in each area are paying out and the trend demonstrates the

Group's ability to work on its weaknesses.

The 5 Campari Group Behaviors Indices - evolution since 2016:

In its bid to distil and reinforce its corporate Culture, Campari Group had liaised with Great Place to Work® to introduce five indices-one for each company Behavior-for survey monitoring and to keep track of the Culture activation and its concrete impact in the workplace.

All the Behaviors Indices have improved along the years. The most relevant improvements as compared with the latest 2018 Survey were seen on the 'Respect Others and the Planet' and 'Build More Value Together' Behaviors, demonstrating once again a strong appreciation of the Company's reaction to the global pandemic.

Other tools for dialogue and engagement-Channels and initiatives

Within the framework of an integrated internal communication ecosystem, meant to promote the culture of sharing by improving communication between departments and geographic areas, some channels have been particularly successful in contributing to enhanced dialogue with the company and among Camparistas.

Yammer, the corporate social network, has proved to be a useful daily tool for internal communication, collecting information, developing team building, sharing best practices and celebrating the work and achievements of Camparistas around the world.

2020 also saw some milestones in the consolidation of Campari TV, an internal TV channel aimed at spreading the company's culture, values and strategy, as well as at supporting change management within transformational

projects among Camparistas around the world. Campari TV content is also taken up in an internal editorial plan conveyed through Yammer and the internal digital signage circuit in use in the various offices.

Finally, in order to increase the Camparistas' involvement in corporate life, a number of engagement initiatives were introduced. One particularly significant example of this was the 'Build More Value Together Award', which saw Camparistas based in all the Group's countries nominate extraordinary examples of both Brand Building

initiatives and Cultural role-modelling across teams and departments. The hundreds of nominations received passed through a screening process and ultimately the Group Lead Team selected the winners for each category, and all the finalists received their award publicly, a video of their endeavours being showcased.

Inclusion, Equity and Diversity in the workplace

In 2020 Campari Group started a journey to develop a new Global Inclusion, Equity and Diversity (IED) strategy.

At Campari Group, we aim at a true meritocracy where individual talents can flourish to their full potential. This can be only enabled by Inclusion, Equity and Diversity, fundamental to our Culture and strongly connected and inspired by our Values. The Group's goal is in fact to continue to nurture a corporate culture in which its people, bonded by the company's Values, feel welcome, trusted and encouraged to bring their whole self to work so they

can truly feel that they belong.

The Campari Group Inclusion, Equity & Diversity strategy sets out the approach and provides a framework for ensuring that everyone within our company working with Camparistas, Business Partners and the Communities is empowered and encouraged to contribute to this journey and support a culture of inclusion.

The Group's commitment is based on three areas of impact:

For Camparistas:	For Business Partners:	For Communities:
To promote a fair and equal	To leverage our diversity to	To embrace and support
employment lifecycle	foster creativity and innovation to	equity by promoting education,
where everyone has all the	better interpret consumer's needs	culture and social inclusion.
opportunities to progress and	and boost business potential.
feels as if they have always
belonged.

Specifically with regard to Camparistas, the approach to action in this area is about looking at the whole Camparista work-lifecycle, consisting of its main journeys (i.e. Attract, Recruit, Engage and Develop) and underlying fundamental touchpoints, identifying the barriers to success and defining concrete initiatives to break them down.

The Group's approach to action to proactively manage inclusion, equity and diversity is based on two main aspects: Culture and Power Acts.

Initiatives within the Culture Activation space firmly position inclusion, equity and diversity as an integral part of

Campari Group's Culture, which is the maximum expression of the Group's identity as a company and as member of the communities in which it operates.

Initiatives within the Power Act space encourage momentum in the right direction, rewarding efforts to overcome the complexity in the short-term and fostering change through reiteration and continuous practice. Power Act initiatives are poised to become the new norm in the relevant area of impact.

Within this framework-while the Group will keep deploying new global initiatives-freedom is provided to each local organization within the Group to identify, design and introduce measures based on their most urgent needs and priorities. An essential enabler for this flexibility, to be interpreted within a common agenda, is to share the same approach, the same language and the same discipline for the purposes of measurement. To this end, the Group will be embarking on an extensive education programme in 2021 in order to align the whole organization to a common vision, and has identified its bespoke Global Inclusion, Equity&Diversity Index, to allow a shared measurement method.

Campari Group Inclusion, Equity&Diversity Index provides actionable insights, both at Group and Country level, enabling concrete and precise measurement to prioritize interventions and initiatives at all levels and to monitor the effect over time. The Index is based on two sets of indicators:

SURVEY-BASED	GRI-BASED
A selection of Great Place to Work® statements,	A selection of KPIs as per GRI Standard, which
describing the key dimensions that underpin an	the Group monitors on a yearly basis for
inclusive, equitable and diverse workplace.	Sustainability Reporting.
Inclusion - Equity - Diversity	Representation - Gender Pay Gap

Campari Group Global Inclusion, Equity&Diversity Index 2020-survey-based results:

Regarding the GRI-based KPIs, the internal Inclusion, Equity&Diversity Index will consider workforce representations based on different elements of diversity as per GRI Sustainability Reporting Standards, with a specific focus on the gender pay gap.

Lastly, the Group put in place an internal multifunctional Inclusion, Equity&Diversity governance structure at all organizational levels (local, regional, functional and global), and a multicultural and cross-country Global Inclusion, Equity&Diversity Advisory Team to actively support the Group in its company-wide efforts in this space, membership of the Team being on a rotational basis.

Campari Group nationalities40:

2018

2019

2020

Nationalities

Permanent Camparistas by region and gender:

2020

Region

Asia-Pacific

Europe, Middle East and Africa North America

South America Total

62
Men	Women	Total	% women
130	94	224	42%
1,043	714	1,757	41%
824	507	1,331	38%
219	120	339	35%
2,216	1,435	3,651	39%

With the exception of the corporate population working in the Product Supply Chain area (which includes production facilities), female Camparistas represented 45% of the total workforce.

Percentage of female Camparistas out of the total workforce-trend

Female Camparistas (%)

2018	2019	2020
37%	37.5%	39%

There was a gradual increase in the number of women in the overall workforce as compared with previous years.

Permanent Camparistas by professional position and gender:

2020

Professional gradeSenior management and above 180

Management 211

Senior professional 350

Professional 490

Specialist/generic staff 343

Blue collar 642

Total

2,216

New Camparistas hired, by region and gender:

2020

Region

Asia-Pacific

Europe, Middle East and Africa North America

South America Total

Percentage of new Camparistas hired out of the total workforce by region and gender:

2020

Region

Asia-Pacific

Europe, Middle East and Africa North America

South America

Total

Percentage of new Camparistas hired by gender-trend:

2018

Men (%)

60% 58%

Women (%)

40% 42%

Women	Total	% women
65	245	27%
133	344	39%
293	643	46%
389	879	44%
401	744	54%
154	796	19%
1,435	3,651	39%
Men	Women	Total	% women
18	14	32	44%
79	64	143	45%
73	45	118	38%
7	8	15	53%
177	131	308	43%
Total
14%
8%
9%
4%
8%
2020
57%
43%

MenMen

Women

14% 15%

8% 9%

9% 9%

3% 7%

2019

40 The number for the Group's nationalities does not include the US and Canada, for which due to local regulations, figures cannot be traced.

Turnover by region and gender:

2020

Region	Men	Women	Total	% women
Asia-Pacific	18	7	25	28%
Europe, Middle East and Africa	95	62	157	39%
North America	221	76	297	26%
South America	14	11	25	44%
Total	348	156	504	31%

The higher number of leavings in North America is mainly due to the business decision to divest the Group's sugar operations in Jamaica. Employees have thus exited the business as their skills were related to sugar production and could not be absorbed within the larger company. The Group, however, has provided resources and support to the exiting employees to include provision of outplacement services (counselling, transition start up kits) and offered scholarships to all exiting employees children for the next five years. An external partnership for the disposal of the sugar farmlands will ensure most of the exited employees to be re-hired externally.

Turnover rate compared to the total workforce by region and gender:

2020

Region	Men	Women	Total
Asia-Pacific	14%	7%	11%
Europe, Middle East and Africa	9%	9%	9%
North America	27%	15%	22%
South America	6%	9%	7%
Total	16%	11%	14%
Voluntary turnover41-trend:
2018	2019	2020
Voluntary turnover (%)	6.3%	5.9%	4%

The low level of voluntary turnover in 2020, 4%, is confirmation of the Group's genuine commitment to building an excellent work environment that Camparistas are not inclined to leave.

New Camparistas hired by region and age bracket:

2020

Region Asia-Pacific

< 30

30-50

> 50

Europe, Middle East and Africa North America

South America Total

11 211

8 - 18

Total 32 143 118 15 308

Percentage of new Camparistas hired out of the total permanent workforce by region and age bracket:

2020

Region

< 30

30-50

> 50

Asia-Pacific

22%

13% 15%

Europe, Middle East and Africa North America

17%

9% 2%

19%

8% 3%

14% 8% 9%

South America

Total

9% 17%

5% 8%

- 3%

4% 8%

Turnover of personnel by region and age bracket:

2020

Region

< 30

30-50

> 50

Asia-Pacific

21 3

Europe, Middle East and Africa North America

89 49

171 88

South America

18 2

25 157 297 25

Total

299

142

504

Turnover rate compared to the total permanent workforce by region and age bracket:

2020

Permanent Camparistas by professional position and age bracket:

Region	< 30
Asia-Pacific	6%
Europe, Middle East and Africa	9%
North America	22%
South America	12%
Total	14%

30-50	> 50	Total
12%	12%	11%
8%	12%	9%
18%	38%	22%
7%	4%	7%
12%	20%	14%
Professional grade	< 30	30-50	> 50	Total
Senior management and above	-	169	76	245
Management	4	278	62	344
Senior professional	33	528	82	643
Professional	141	610	128	879
Specialist/generic staff	148	469	127	744
Blue collar	129	438	229	796
Total	455	2,492	704	3,651

2020

Although not Group policy, the Company tends to favour the hiring of managers who live in the countries in which it operates.

Learning and professional development in the workplace

Campari Group believes in developing the skills of its People as a means of responding to business needs, building profitable brands and guaranteeing excellent financial results.

In Campari Group, people development is strongly connected with the organizational growth. Growing individually is a lever for growing as an organization and it means supporting performance and developing people's potential.

Learning is the pillar for sustaining individual development and is considered to be a key competitive advantage for the business.

In 2020, Campari Group completed its Corporate Learning Experience re-design. The new ecosystem is built on a new technology, a reshaped content offer and an agile governance and operating model. The implementation of a new Learning Management System (LMS) offers the opportunity to make the learning experience more open and scalable with access to multiple digital resources. It is tied to a unified framework with a direct access to Camparistas' personal learning plan and historical data. Implementation of the LMS makes it possible to integrate the Learning and Talent Management Processes.

The reshaped content offer has been thought out to give all Camparistas the opportunity to access Learning Activities and to offer them relevant solutions for their specific needs. It is built on agility and digitalization and on concrete off-the-shelf, tailor-made and blended content that integrates existing programmes and breaks down functional ties. The new Learning Management System, the Learning Distillery, makes Camparistas accountable for their own development. Its objective underlying the strategy is to make learning a personal daily habit and a common management practice with a direct impact on performance and engagement. Camparistas have a direct access to learning resources when and about what they need, minimizing the time lag between learning and the use of what they have learnt. The Learning Distillery in Campari Group is an ecosystem that provides managers with an additional lever for managing performance and developing teams and individuals.

In the past few years, the Company has invested in developing a Global Capabilities Development ('GCD')

architecture. Designed to align the training and learning strategy with business needs, the architecture ties in directly with a global Talent Management process, as it provides all Camparistas with support in achieving their individual development goals. From the point of view of a Camparista, one of the main outcomes of the annual

Talent Management process is the drafting of the Individual Development Plan ('IDP'), which brings together the

Global Capabilities Development architecture and the Talent Management model. Managers, together with Human Resources, are called on to support continuous development, building concrete and sustainable pathways with each Camparista. By providing a diverse series of learning activities, Campari Group thus accelerates the professional growth of its people, making them responsible for their own development. Campari Group's global Talent Management process is the foundation of all people development initiatives, including a thorough succession planning reflection by the management teams every year at all company levels (local, regional, corporate), strongly supported by a dedicated digital platform. Whenever an internal successor is ready to take on any vacant position, Campari Group prioritizes the internal candidate. In case there is no successor identified, jobs are posted both externally and internally through a dedicated Internal Career Site, where any Camparista can apply.

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Davide Campari - Milano NV published this content on 25 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 February 2021 10:14:03 UTC.

Market Closed - Borsa Italiana Other stock markets 09:14:59 17/05/2024 pm IST			5-day change	1st Jan Change
9.796 ^EUR	-2.19%		-1.15%	-4.10%

09/05	EMEA Morning Briefing : Shares Seen Higher Ahead of BOE Decision	DJ
08/05	Mib lone bearish; Leonardo shines in Milan	AN

EMEA Morning Briefing : Shares Seen Higher Ahead of BOE Decision	09/05	DJ
Mib lone bearish; Leonardo shines in Milan	08/05	AN
MIb down; Leonardo bats a path after accounts	08/05	AN
Mib bearish; focus on quarterlies	08/05	AN
DAVIDE CAMPARI-MILANO : Resilience is still a major Campari feature	07/05
Mib still in the green; Campari drags bullishness	07/05	AN
Campari Keeps Outlook Despite Slight Sales Drop -- 2nd Update	07/05	DJ
Campari Keeps Outlook Despite Slight Sales Drop -- Update	07/05	DJ
Campari Keeps Outlook Despite Slight Sales Drop	07/05	DJ
Indices in green; Iren hurt after Ad shutdown	07/05	AN
Campari closes first quarter with rising profit	07/05	AN
Transcript : Davide Campari-Milano N.V., Q1 2024 Earnings Call, May 07, 2024	07/05
Spirits makers exposed to China's EU brandy probe	05/05	RE
DAVIDE CAMPARI-MILANO : Opinion change, from Buy to Add	03/05
Campari Group Completes $1.17 Billion Courvoisier Acquisition	30/04	MT
Campari finalizes acquisition of Courvoisier cognac	30/04	AN
Davide Campari-Milano N.V. completed the acquisition of Courvoisier S.A.S. from Beam Suntory Inc for approximately ?1.2 billion.	30/04	CI
Pernod Ricard Sales Fall as It Struggles in China, U.S. -- 2nd Update	25/04	DJ
Pernod Ricard Backs Guidance Despite Lower Sales -- Update	25/04	DJ
Campari Group's New CEO Aims to Grow Aperol Brand in Asia	22/04	MT
Campari inaugurates new Aperol bottling line in Novi Ligure	19/04	AN
Traders ignore Powell; Popolare Sondrio bullish	17/04	AN
Mib up; DiaSorin leads the way	17/04	AN
Oddo BHF Keeps Campari Group at Underperform, Lowers PT	16/04	MT
CAMPARI : price target lowered by Oddo BHF	16/04	CF

	1st Jan change	Capi.
DAVIDE CAMPARI-MILANO N.V.	-4.10%	1.31TCr
KWEICHOW MOUTAI CO., LTD.	-0.64%	30TCr
WULIANGYE YIBIN CO.,LTD.	+11.47%	8.28TCr
SHANXI XINGHUACUN FEN WINE FACTORY CO.,LTD.	+14.32%	4.42TCr
LUZHOU LAOJIAO CO.,LTD	+5.81%	3.78TCr
JIANGSU YANGHE BREWERY JOINT-STOCK CO., LTD.	-11.10%	2TCr
ANHUI GUJING DISTILLERY CO., LTD.	+14.76%	1.69TCr
UNITED SPIRITS LIMITED	+5.80%	1TCr
JIANGSU KING'S LUCK BREWERY JOINT-STOCK CO.,LTD.	+18.15%	965.92Cr
ANHUI YINGJIA DISTILLERY CO., LTD.	+9.94%	814.47Cr

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