FDJ records a 4.6% increase in sales to €14.3 billion in 2016 and enters third year of its FDJ 2020 project - European Lotteries

Boulogne, 19 January 2017

                FDJ records a 4.6% increase in sales to €14.3 billion in
                2016 and enters third year of its FDJ 2020 project
                FDJ’s sales have passed the €14 billion mark at €14.3 billion, an increase of approximately €600 million
PRESS RELEASE

                compared with €13.7 billion in 2015. This growth was driven by the strong momentum of betting
                activities (UEFA Euro 2016 in France), scratch games and digital activities (new apps to prepare stakes).
                This momentum, after growth of 5.4% in 2015 (sales up €700m), underpins the second year of
                implementation of the “FDJ 2020: FDJ augmented vision” strategic project, which puts digital
                technologies and innovation at the heart of its activity and physical network.

                For Stéphane Pallez, President and Chief Executive Officer of the FDJ Group, “the game sector is
                continuing its transformation around the world with the introduction of new games, new generations of
                customers more accustomed to using digital technologies, and new meeting ground with the players.
                This revolution in games and betting is a source of opportunities for FDJ, the second-largest lottery
                company in Europe, committed to the completion of its FDJ 2020 project. The sales growth recorded in
                2016 will enable us to continue FDJ’s digital transformation in optimum conditions, in line with the
                Group’s responsible business model. In 2017, FDJ will develop its dimension as a group, notably by
                merging its headquarters and several subsidiaries into a new site. FDJ will also strengthen the identity
                of the FDJ brand and its appeal in terms of entertainment and commitment values.”

                       Robust activity in 2016

                       →   €9.5 billion won by customers (an increase of around €500 million vs. 2015); 235 winnings > 1 million vs. 215 in 2015
                       →   €718 million in revenues for local sales points (+ 4%; + €30 million)
                       →   Sports betting activities totalled €2.5 billion, up 11% (+ €240 million); 3.5 million players
                       →   Scratch games and interactive games generated sales of €6.9 billion, up 7% (+ €450 million)

                       Development of FDJ 2020 strategic project

                       →   €88 million investment in future development
                       →   Digital sales rose 65% to more than €900 million
                       →   Launch of 6 new generation lottery games, more diverting and interactive
                       →   Automation of FDJ’s logistics base allowing for the preparation of 6,000 packs/day
                       →   Launch of FDJ Gaming Solutions, offering content and technology to lotteries across the world

                       Corporate Social Responsibility

                       →   €3.1 billion contributed to the national community
                       →   SaferGame, designed jointly by FDJ and IBM, a Big Data solution for gaming integrity and responsible gaming
                       →   Sports sponsorship: UEFA Euro 2016 (close to €150 million for stadium renovations), 25th anniversary of its Foundation’s
                           Challenge programme, support for the Paris bid for the 2024 Summer Olympics, “Sport pour Elles” programme to support
                           women in sports, notably co-sponsoring a female cycling team
                       →   FDJ tops WWW France’s Pap 50 barometer for its paper policy

                       2017 Objectives

                       →   Pass €1 billion mark in digital sales
                       →   Continue to support the development of sports betting in France with new betting formulas and new point of sales tools
                       →   New Loto formula; pilots for new generation games in the network (digital tickets)
                       →   Network consolidation and modernisation: drive to scout Newsagents-Tobacconists-Bars-Local sales points; installation of
                           new gaming stands and digital displays
                       →   Launch of a scratch game to support the Paris bid for the 2024 Summer Olympics
                       →   Prevention of gaming for minors: new tools and signing at points of sale, new training programme for the 800 FDJ sales
                           people and 8,000 of the largest points of sale
                       →   Development of the Group dimension, digitisation of working environment to encourage innovation, new working methods
                           (quality of life at work and improved performance)

Results of game ranges

French players mostly continued to stake relatively small amounts: 26 million betters played average stakes of
€10.6 per week (vs. €10 in 2015). Winnings amounted to €9.5 billion (€500 million more than in 2015).
Redistribution increased by + 0.6 point to 66.6% of stakes.
235 winnings > €1 million (215 in 2015), of which 15 winnings > €10 million (vs. 10 in 2015). The record of the
year was €66 million won in Paris with the Euro Millions-My Million game.

► Lottery games accounted for 82% of sales, i.e. €11.8 billion (vs. €11.4 billion in 2015), a 3.3% increase
driven by scratch games and interactive games

        Scratch games and interactive games accounted for 48% of FDJ’s sales

This gaming category recorded €6.9 billion of sales, up 7% (vs. €6.4 billion in 2015). The 20-odd scratch tickets
on the market attracted more customers: 18.7 million compared with 18.6 million in 2015.
Over and above the upgrade of the main games, this growth was attributable mainly to the success of football-
themed games (Goal, Maxi Goal, UEFA-Euro 2016), which generated sales of more than €400 million.

        Scratch games accounted for 34% of FDJ’s sales

Scratch games recorded sales of €4.9 billion compared with €5 billion in 2015, down 1.6% due to the decline of
Euro Millions-My Million before its relaunch in September and to the Amigo game being less promoted.

FDJ celebrated 40 years of its Loto game in 2016. For this occasion, FDJ broke new ground by offering the first
participatory jackpot in the history of the game. Loto continues to attract 17.5 million players and €1.5 billion
stakes, confirming its resilience despite a smaller number of events (only one week with a Friday 13th in 2016
vs. three in 2015). The record of the year was €17 million, won in the Côte d’Or department. Loto holds the all-
time record winning on FDJ.fr with €16 million won this year.

Euro Millions-My Million recorded €1.4 billion in sales in 2016 (€1.5 billion in 2015). The new formula launched
mid-September attracted 14.7 million customers, i.e. nearly one million new players. It helped revive sales with
an increase of 8% (vs. -8% in the first 9 months of 2016). 15 winnings of more than €1 million were recorded in
France against four in 2015, with a record of €66 million compared with €40 million in 2015. My Million made
143 million-euro winners compared with 146 in 2015.

Amigo recorded €1.3 billion in sales, down 1.8% from 2015 as there were fewer publicity events for the game
in 2016.

Together, Keno and Joker+ generated stakes of close to €700 million.

► Sports betting activities represented 18% of FDJ’s sales at €2.5 billion (vs. €2.3 billion in 2015), up
11% due to the UEFA Euro 2016 in France

The range is benefiting from the growing popularity of sports betting with French players, catching up with their
European counterparts (7% penetration rate for adult population in France vs. 12% in the rest of Europe). The
number of players grew to 3.5 million, i.e. 200,000 new players in 2016.
2016 notably benefited from the UEFA Euro 2016 being held in France (€174 million in sales, + 94% compared
with the Euro 2012), as well as from the Summer Olympics (€23 million in bets, + 6% vs. the London 2012
Olympics). FDJ used these opportunities to extend its offering (eight new sports and types of bets).

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Second year of FDJ 2020 project
The FDJ 2020 strategic project aims to enable the company to adapt to new digital consumer behaviour at
points of sale and online. FDJ has earmarked €500 million for investment by 2020 in order to transform its IT
base (€250 million), digitise the network (€180 million) and invest in innovation, notably through start-up funds.
In 2016, FDJ invested €88 million, i.e. a total of €190 million since 2015.

FDJ has set itself a target of close to 20% in “digitized sales” by 2020. In 2016, digitized sales amounted to
more than €900 million compared with more than €550 million in 2015, i.e. 6.5% of sales, an 65% increase vs.
2015.

► News frontiers for FDJ 2020

Customers
FDJ is targeting close to one million new players in 2020, particularly young adults and women. With 26 million
customers in 2016, of which 13 million women and 6.7 million young adults in 2016, FDJ is stabilising its player
pool. Player numbers increased by 0.1 million for scratch games, 0.2 million for draw-based games and
0.2 million for sports betting activities while decreasing by 0.5 million for Amigo.

Games and services
● FDJ is looking for 10% in sales of breakthrough innovation games by 2020.
FDJ has developed its online offering, with 26 new games available. It has notably launched the Illiko Actions
range, with entertaining, interactive new generation games (Duel de Cartes, Happy Dés, Les Trésors du Nil and
L’Or des Caraïbes).
● FDJ is developing its digital services.
Most of FDJ’s games (Loto, EuroMillions-My Million, Illiko, Parions Sport) are available on all digital channels
(PC/Smartphone/Tablet).
The Parions Sport app, which enables players to prepare their stakes on their mobile phones, is highly popular:
28% of Parions Sport stakes at end-2016 compared with 8% at end-2015. In addition, after the Loto and Euro
Millions-My Million apps, FDJ has launched an Illiko app.

Networks
The physical network remains strong with more than 31,100 points of sale (vs. 31,900 in 2015), i.e. the no.1
French local network, present in more than 11,000 municipalities. Revenues paid to the network by FDJ reached
€718 million, an increase of 4% compared with 2015 (about + €30 million), i.e. average commissions paid to
retailers (including commissions linked to paying out winnings) of more than €20k per point of sale (+ 9% on
average per point of sale).
In order to maintain its network, FDJ created over 700 new points of sale. In 2016, more than 1,000 points of
sale benefited from the addition of at least one licence (draw-based games, scratch games, Amigo or Sport).
FDJ is also very gradually opening local points of sale other than Newsagents-Tobacconists-Bars. These new
outlets remain limited to roughly 1,400 points of sale (petrol stations, grocery stores, bakeries, etc.), or 5% of
the network in 2016, including in border areas where Newsagents-Tobacconists-Bars are particularly hard hit
by foreign competition.

It is also upgrading its traditional network with the roll-out of 12,000 equipment kits (stands and displays) and
strengthening the control of its intermediate distribution circuit (100% of the sectors steered directly or indirectly
by FDJ; two-thirds of sales internalised in 2016).

International
FDJ is keen to channel its FDJ 2020 investments into cooperation with national lotteries. In this way, FDJ
successfully operated the Portuguese sports betting offering in 2016. In order to further develop this initiative,
on the occasion of the World Lottery Summit 2016, FDJ launched “FDJ Gaming Solutions”, a new commercial
brand to sell technology (operating platforms for lottery and sports betting games), new generation games and
services for global lotteries.

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► A new way of working in start-up mode and Open Innovation

In 2016, FDJ accelerated the digital transformation of its organisational structure: merger of Marketing and
Digital Departments, multiplication of incubation cells (six in 2016: gamification, social gaming, etc.), innovation
trip abroad.
It has initiated cooperation with its new partners:
   ● Gaming: with French publisher Asmodee, the no.2 in Europe (L’Or des Caraïbes, Splendor)
   ● Innovation/start-up: €15 million investment in two management companies, Partech and Raise
   ● Innovative school: reflection on the new Loto 2017 with the Web School Factory
   ● New media: YouTube and Facebook.

► Transformation of the technological and logistics base

FDJ has pressed on with the overhaul of its IT system, which is now more powerful (4 billion transactions in
2016, digital platform capabilities increased from 15,000 to 100,000 connections) and nimble (launch of “global
gaming” experience accessible on smartphones, tablets and online).

On 24 January 2016, FDJ launched an automated logistics system to prepare orders for retailers at its central
warehouse. By the end of 2018, this investment of more than €10 million will make it possible to make direct
deliveries to our entire sales network (2,700 POS already benefited from direct deliveries at end-2016).

► A responsible, committed company

● Gaming integrity
FDJ and IBM have forged a partnership based on a Big Data approach and designed the SaferGame software
application to combat laundering and excessive gambling in the network (launch in 2017). FDJ has
strengthened its initiatives to encourage a recreational use of gaming, in particular actions to prevent underage
gaming during the UEFA Euro 2016 (prevention campaign with TV spots “Le sport on le vit, le pari on l’oublie”
(Experience sports live, forget about betting) and with the distribution of 50,000 information leaflets in the fan
zones).

The Group continued to build ties with the civil society, academic world (GIS: scientific interest group bringing
together four universities of the Paris area) and associations.
FDJ organised and facilitated the World and European Lottery associations’ seminar on responsible gaming,
held in Paris.

● Corporate Social Responsibility

A committed and innovative HR policy: the Group has 2,137 employees (1,800 in 2015).

FDJ is engaged in terms of gender equality: a proactive approach co-driven by senior managers and General
Management helped advance the proportion of women in line management by 4% in one year to 38%. The
group’s engagement for disability is unswerving: the employment rate of people with disabilities has been
around 6% for the last four years. Lastly, FDJ is sensitive to social diversity: the Group conducts recruitment
actions in less privileged environments (in partnership with Mozaik RH) and sponsors schoolchildren through
the charity Telemachus, as well as young graduates seeking employment through the charity Nos Quartiers ont
des Talents (63 young graduates sponsored in 2016, 23 returns to employment).

► A company that makes a contribution to society

Strong contribution to society: since its creation, FDJ has based its approach on a model of redistribution for
the greater benefit. In 2016, close to 95% of stakes were distributed: to customers (66.6%; €9.5 billion), to
retailers (5.2%; €718 million) and to the national community (21.8%; €3.1 billion).

FDJ is more than ever committed to supporting sport: financing of “sport for all” in France (more than €220
million in 2016) and of the construction or renovation of the stadiums that hosted the UEFA Euro 2016 (close to
€150 million between 2011 and 2016), fighting corruption in sports and championing French sport (FDJ
commitment for the Paris bid for the 2024 Summer Olympics, victory of FDJ-sponsored cyclist Arnaud Démare
in the Milan San Remo race, etc.).
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The FDJ Corporate Foundation, which is currently active in the fields of sports, disability and solidarity, has
decided to devote a portion of its resources to encouraging equal opportunities in the years ahead.

                           The 2016 financial data cited in this press release have not yet been audited

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