EssilorLuxottica : 23 February 2023 – Full year 2022 Results Press releases

FY 2022 Results

Year of records in sales, operating and net profit

All regions and segments contributing

Progressing on all social and sustainability initiatives

• Group's sales at Euro 24.5 billion in FY 2022, up 13.9% vs 2021 in comparable3 terms
• Adjusted2 operating margin at 16.8% in FY 2022, up 70bps vs pro forma4 FY 2021
• Group's comparable-store sales5 up 7.7% in FY 2022, ex-GrandVision outperformed at +9.3%
• Investment in capex and M&A to strengthen the business model
• Free cash flow6 at Euro 2.26 billion in FY 2022
• Dividend proposed at Euro 3.23 per share, up 29% vs FY 2021
• Comparable revenue3 up 9.4% in Q4 2022, +3.9% at constant exchange rates1
• Appointment of Jean-Luc Biamonti as lead director

Charenton-le-Pont, France (February 23, 2023 - 7:00 am) - The Board of Directors of EssilorLuxottica met on February 22, 2023 to approve the consolidated financial statements for the year ended December 31, 2022. These financial statements were audited by the Statutory Auditors whose audit report is in the process of being issued.

Francesco Milleri, Chairman and CEO, and Paul du Saillant, Deputy CEO at EssilorLuxottica commented:

"From record sales of 24.5 billion to groundbreaking product innovations, EssilorLuxottica delivered on the promise of a strong, unified company in 2022. Our late Chairman, Leonardo Del Vecchio, would have been proud to see the new heights we reached in every geography and the growing bonds between our people and customers. It is with these deep connections in mind that our thoughts today go to our employees and partners in Turkey, and all those impacted by the devastating earthquakes in Turkey and Syria.

In 2022, we strengthened our open, collaborative business model, while completing important acquisitions such as Walman in North America and Shamir in Israel, and continuing to invest in quality eyecare and eyewear for the benefit of the entire market. At the same time, we continued to showcase our unique innovation capability, through new sustainable collections and the ongoing deployment of new lens products and categories.

In the face of ongoing macroeconomic uncertainties, we remained focused on our strategic levers: the vertical integration of our business, the embedding of big data in any corporate decision, our global footprint, and the deployment of our sustainability program Eyes on the Planet. In 2022, we also confirmed our long-term commitment to our mission by launching the largest vision care foundation in the world. All these key factors, combined with our nearly 200,000 talented employees, will enable us to achieve continued growth in the years ahead."

Financial & Operational Highlights

Due to the structure of 2021 consolidated statement of profit or loss, which includes GrandVision's results and the effects resulting from the combination accounting only for the second semester of the year, management deemed relevant to comment the Group's performance of the year 2022 versus the pro forma4 information of the year 2021. Moreover, consistently with the past financial communication and in order to allow a proper comparison with the long-term outlook, the Group is presenting adjusted2 measures in addition to the ones directly stemming from the IFRS consolidated financial statements.

P&L KEY ADJUSTED2 DATA	FY 2022	FY 2021	Change	Change
	Adjusted 2	at constant	at current
Euro millions	Adjusted 2
	Pro forma 4	exchange rates1	exchange rates
Revenue	24,494	21,498	+7.5%	+13.9%
Gross Profit	15,606	13,628	+8.3%	+14.5%
% of revenue	63.7%	63.4%
Operating Profit	4,115	3,471	+10.9%	+18.5%
% of revenue	16.8%	16.1%
Group Net Profit	2,860	2,319	+15.4%	+23.3%
% of revenue	11.7%	10.8%

P&L KEY DATA
Euro millions	FY 2022	FY 2021*

Change	Change
at constant	at current
exchange rates1	exchange rates

Revenue	24,494	19,820	+16.6%	+23.6%
Gross Profit	15,583	12,231	+20.5%	+27.4%
Operating Profit	3,157	2,307	+26.5%	+36.8%
Group Net Profit	2,152	1,448	+37.2%	+48.6%
EPS basic (Euro)	4.87	3.30
EPS diluted (Euro)	4.83	3.25

• The comparative period has been restated to reflect the finalization of the purchase price allocation ("PPA") related to the acquisition of GrandVision, which was accounted for on a provisional basis in EssilorLuxottica consolidated financial statements as of and for the year ended December 31, 2021.

Group revenue by segment and region

Euro millions	FY 2022	FY 20213	Change	Change
			at constant	at current
			exchange rates1	exchange rates
Professional Solutions	11,770	10,399	+6.3%	+13.2%
Direct to Consumer	12,724	11,099	+8.6%	+14.6%
TOTAL REVENUE	24,494	21,498	+7.5%	+13.9%

Euro millions	Q4 2022	Q4 20213	Change	Change
			at constant	at current
			exchange rates1	exchange rates
Professional Solutions	2,905	2,678	+2.8%	+8.5%
Direct to Consumer	3,201	2,901	+4.9%	+10.3%
TOTAL REVENUE	6,106	5,579	+3.9%	+9.4%

Euro millions	FY 2022	FY 20213	Change	Change
			at constant	at current
			exchange rates1	exchange rates
North America	11,492	9,868	+4.0%	+16.5%
EMEA	8,749	7,953	+11.2%	+10.0%
Asia-Pacific	2,842	2,542	+7.2%	+11.8%
Latin America	1,410	1,136	+13.1%	+24.2%
TOTAL REVENUE	24,494	21,498	+7.5%	+13.9%

Euro millions	Q4 2022	Q4 20213	Change	Change
			at constant	at current
			exchange rates1	exchange rates
North America	2,892	2,528	+2.7%	+14.4%
EMEA	2,086	1,987	+6.2%	+5.0%
Asia-Pacific	731	706	+3.1%	+3.5%
Latin America	398	359	+0.6%	+10.6%
TOTAL REVENUE	6,106	5,579	+3.9%	+9.4%

In 2022 EssilorLuxottica delivered another year of revenue growth and margin expansion, thanks to the effective execution of its strategic vision and integration journey, on track with its long-term financial roadmap (summarized by the 2022-26 targets), as outlined by the management at the Capital Market Day, last year in September in Milan. In line with its calling to be the industry's leading innovator, 2022 has also been a year rich of novelties on its key categories: from the latest evolution coatings of Crizal and Shamir and the successful third-year clinical trial of Stellest to the first Ray-Ban Wayfarer sustainable collection and the new license agreements with Brunello Cucinelli, Ferrari and Swarovski on top of the record 15-year renewal of Armani. The recent launch of the new generation Varilux XR Series powered by artificial intelligence also made for a bold start into 2023.

The fourth quarter of last year grew in revenue by 3.9% at constant exchange rates1, still a sound pace even though the slowest of the year, mostly due to the challenging comparison base with the best quarter of 2021, when comparable3 revenue rose 11.0% vs Q4 2019 at constant exchange rates1. The full year closed at Euro 24,494 million revenue, up 7.5% at constant exchange rates1 versus pro forma4 2021. In the light of the macro headwinds of the period, such a solid performance proves once again that the global reach, the open model and the progressing integration of the Group are all paying off.

EMEA was the best performing region in the fourth quarter, up 6.2% in revenue at constant exchange rates1 thanks to the sound pace of France, Italy, Spain, the UK and Scandinavia. In North America revenue was up 2.7% at constant exchange rates1 against the tough fourth quarter of 2021 when revenue rose +13.9% versus 2019, with Professional Solutions sustained by the lens business and a solid price-mix and Direct to Consumer growing despite a challenging comparison base. Revenue in Asia-Pacific and Latin America advanced by 3.1% and 0.6% at constant exchange rates1, at a lower pace due to the negative impact of the COVID-19 policy in Mainland China and just flattish business trend in Brazil.

As for the operating segments, in the fourth quarter Direct to Consumer led the Group's top line growth, with revenue up 4.9% at constant exchange rates1. The retail brick-and-mortarcomparable-store sales5 rose approximately 4%, slowing down versus Q3 mostly due to a challenging comparison base. Professional Solutions rose 2.8% at constant exchange rates1 mainly driven by the solid performance of EMEA and an acceleration in North America.

E-commerce decelerated in the last quarter of the year, up only 1% mostly due to a tough comparison base. Overall, the online business represented 7% of the Group's turnover in the full year.

As for the Group's profitability, the adjusted2 gross profit amounted to Euro 15,606 million in the full year, reaching 63.7% of revenue, 30 basis points higher than pro forma4 FY 2021 (or 40 basis points at constant exchange rates1), that is a remarkable performance given the impact of inflation on the input costs, namely labor, energy, freight and raw materials.

The adjusted2 operating profit reached Euro 4,115 million in the full year, representing 16.8% of revenue, compared to 16.1% in pro forma4 FY 2021, a margin expansion of 70 basis points (or 60 basis points at constant exchange rates1), despite the material increase of the labor cost, due to the inflationary pressure on wages globally.

The adjusted2 Group net profit amounted to Euro 2,860 million in the full year, increasing by 15.4% at constant exchange rates1 compared to pro forma4 FY 2021, accounting this year for 11.7% of revenue. The operating profit and the Group net profit directly stemming from the IFRS consolidated financial statements amounted to Euro 3,157 million and Euro 2,152 million respectively in the full year.

The consolidated free cash flow6 amounted to Euro 2,256 million in the full year.

The Company ended the year with Euro 1.96 billion in cash and cash equivalents and a net debt7 of Euro 10.25 billion (including Euro 3.18 billion lease liabilities) compared to a net debt7 of Euro 9.70 billion at the end of December 2021.

Storecount on December 31, 2022

	North	EMEA	Asia-	Latin	Corporate	Franchising	Total
	America	Pacific	America	Stores	& Other	Storecount
Sunglass Hut	1,682	621	297	415	3,015	189	3,204
LensCrafters	1,012		81		1,093	5	1,098
Apollo Optik		680			680	220	900
Vision Express		664			664	160	824
Target Optical	562				562		562
MasVision		72		468	540	9	549
Pearle		497			497	223	720
GMO				421	421		421
Générale d'Optique		386			386	294	680
OPSM			371		371	28	399
Atasun		295			295	31	326
Oakley	184	12	73	20	289	81	370
Ray-Ban	32	47	131	41	251		251
Salmoiraghi & Viganò		249			249	28	277
Synoptik		248			248		248
GrandOptical		233			233	78	311
Optical House		221			221		221
GrandVision		205		12	217		217
Mujosh			138		138	401	539
Pearle Vision	110				110	462	572
MultiOpticas		106			106	112	218
Aojo			93		93	227	320
Bolon			50		50	157	207
Óticas Carol				24	24	1,428	1,452
All Others	252	1,508	132	738	2,630	171	2,801
Total EssilorLuxottica	3,834	6,044	1,366	2,139	13,383	4,304	17,687