lei815600049a1f9afe6666-2022-12-31-en

GRI 3: Material topics
2021

3-3 Management of
material topics

1.2 Materiality
analysis and the
stakeholder
engagement
CORRELATION OF
MATERIAL TOPICS
AND GRI
2.3 Main non-financial
risks
4.1 Management of
environmental
impacts

GRI 302: Energy
2016

302-1 Energy
consumption within
the organization

4.2.3 Reducing
energy consumption
and combating
climate change

GRI 3: Material topics
2021

3-3 Management of
material topics

1.2 Materiality
analysis and
stakeholder
engagement
CORRELATION OF
MATERIAL TOPICS
AND GRI
2.3 Main non-financial
risks
4.1 Management of
environmental
impacts

CONTENTS


Letter to Stakeholders	12
Composition of Corporate Bodies	14
Mondadori Group Structure	15
Mondadori Group Organization Structure	16
Overview of Group Activities	17
Group History Milestones	20
Mondadori Share	22
Sustainability strategy	26

DIRECTORS’ REPORT ON OPERATIONS IN 2022	29
Mondadori Group highlights in 2022	30
Performance of the main income indicators	32
Market and business area highlights of the Group	35
Consolidated Financial Highlights in 2022	36
Consolidated Financial Highlights in Fourth Quarter 2022	47
Performance by Business Area	54
Balance Sheet	73
Personnel	78
Performance of Arnoldo Mondadori Editore S.p.A.	80
Internal Control and Risk Management System	82
Significant Events during the Year	88
Significant Events after Year End	91
Share buyback	91
Other Information	92
Glossary of Terms and Alternative Performance Measures used	97
Business Outlook	99

CONSOLIDATED NON-FINANCIAL STATEMENT	103


MONDADORI GROUP CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2022	203
Consolidated Statements of Financial Position	204
Consolidated income statement	206
Consolidated Comprehensive Income Statement	207
Consolidated statement of changes in consolidated equity	208
Consolidated statement of cash flows	210
Consolidated Balance Sheet and Income Statement pursuant to CONSOB Regulation no. 15519 of 27 July 2006	212
Explanatory Notes	216
Certification of the Group’s consolidated financial statements pursuant to Article 81-ter of CONSOB Regulation no. 11971 of 14 May 1999 as subsequently amended and	312

ARNOLDO MONDADORI EDITORE S.P.A. FINANCIAL STATEMENTS AT 31 DECEMBER 2022	315
Statements of Financial Position	316
Income statement	318
Comprehensive Income Statement	319
Statement of Changes in Equity	320
Statement of cash flows	322
Statements of Financial Position and Income Statement pursuant to CONSOB Regulation n.15519 of 27 July 2006	324
Accounting standards and explanatory notes	328
Annexes to the Financial Statements	388
Certification of the Company’s financial statements pursuant to Article 81-ter of CONSOB Regulation no. 11971 of 14 May 1999 as subsequently amended and supplemented	409

LETTER TO

STAKEHOLDERS

For our Group, 2022 was an extremely

positive year, characterised by very

significant results, mainly achieved through

the acceleration of our repositioning strategy

and refocus on the book as a product over

the last two years. It is a path that other

important international groups in the industry

have today decided to embark on but in which

Mondadori can proudly claim it is a forerunner.

Multiple purchases in the book segment have

been completed in the last 24 months, both

in the Trade and School textbooks area,

clearly strengthening the Group’s competitive

positioning, expanding its editorial offers and

making a significant contribution towards

further improving its future prospects.

The parallel consolidation of the presence in

the book promotion and third-party

publishers distribution segments is the

underlying assumption for both the

development of another promising business

area and the identification of new

opportunities for inorganic growth.

The uninterrupted effort to strengthen and

develop our network of bookstores in a

capillary fashion and the continuous attention

paid to adapting the characteristics, format

and dimensions of the stores to suit the

various needs expressed by the market bear

witness to the Group’s constant commitment

to guaranteeing its publishing houses

adequate capacity to convey its editorial

proposals to readers.

In the Media area, we are careful to make the

most of the opportunities offered up over

time by digital technology, also seeking to

consolidate the role played by Mondadori as

leading multimedia publishers in Italy, whilst at

the same time reducing exposure to the

traditional magazines segment and its

vulnerability to demands coming from the

technological transition.

Thanks to the work carried out during the

course of the year, we have successfully

consolidated and further strengthened our

economic-financial structure, with revenues

and margins showing two-figure growth, at

the same time having all the resources we

need to face up to the demanding and

increasingly complex market scenario.

It is in fact evident how the geopolitical and

macroeconomic context proposed throughout

the year just passed, and continue to propose,

instability factors and challenges - first and

foremost the dramatic rise in energy and

commodity costs - which the Group has had to

face, and continues to have to face, but to

which it has shown its capacity to respond

quickly and effectively.

It must be stressed that the amount of

resources Mondadori has allocated to

financing the growth and development plans

described previously, and the return in 2022,

after more than 10 years, to the distribution of

a significant dividend to its shareholders,

constitute the most concrete sign of financial

solidity characterising our Group. The

resources available to us, and which we have

proven able to generate, allow us to continue

to cultivate ambitious growth, investment and

development targets for the next few years,

guaranteeing shareholders a suitable

remuneration of their capital.

During the year, we also continued, and further

increased, the opportunities for listening and

discussing with all our internal and external

interlocutors, with the aim of consolidating the

key topics and areas on which we want to

focus our commitment and work as leading

publishers of the Italian cultural scene: from

Diversity & Inclusion to the 2022 Three-Year

Sustainability Plan and the definition of a

hybrid work model on the basis of the various

needs of the different professional areas.

During the year, we worked to spread an

inclusive culture, including within our company:

webinars, focus groups, surveys and specific

initiatives have allowed us to offer moments of

awareness-raising and training on Diversity &

Inclusion topics. Our aim is to be a company

that allows everyone to enhance their

uniqueness, appealing to the new generations.

Professionalism, new skills and profiles are

crucial to our future.

In 2023, we will continue this virtuous path with

great determination and faith, with the aim of

consolidating the numerous transformations

that have characterised the year just ended and

make the most of all the additional growth

opportunities the market can offer.

We have the desire, the know-how and the

tools to face up to all the challenges that await

us.

Marina Berlusconi

Chairman of the Mondadori Group

Antonio Porro

Chief Executive Officer of the

Mondadori Group


			13

COMPOSITION OF THE

CORPORATE BOARDS

CORPORATE OFFICES AND SUPERVISORY BODIES

Board of Directors*

CHAIRMAN

Marina Berlusconi

CEO

Antonio Porro

DIRECTORS

Pier Silvio Berlusconi

Elena Biffi**

Valentina Casella**

Francesco Currò

Alessandro Franzosi

Paola Elisabetta Galbiati**

Danilo Pellegrino

Alceo Rapagna**

Angelo Renoldi**

Cristina Rossello

Board of Statutory Auditors*

CHAIRMAN

Sara Fornasiero

STANDING AUDITORS

Flavia Daunia Minutillo

Ezio Maria Simonelli

ALTERNATE AUDITORS

Mario Civetta

Annalisa Firmani

Emilio Gatto

* The Board of Directors and the Board of Statutory Auditors currently in office were appointed by the Shareholders ' Meeting of

27 April 2021

** Independent Director

2022 ANNUAL FINANCIAL REPORT


			15

2022 ANNUAL FINANCIAL REPORT

OVERVIEW OF GROUP

ACTIVITIES

Mondadori is the top Italian publisher, leading the market of trade books and school textbooks

market, where it operates through the Country's most prestigious publishing houses and publishing

trademarks, and one of the major players in the retail segment, thanks to a widespread network of

bookstores across the Country.

The Group is also the leading multimedia publisher, with a strong presence in the digital and social

media segments, as well as a in the print magazine segment.


			17

2022 ANNUAL FINANCIAL REPORT


		BOOKS
		Mondadori Libri S.p.A. is the wholly-owned subsidiary that is responsible for all activities in the Books area, traditionally divided into the two segments Trade and Education. The scope of the Trade business unit includes: •editorial activities relating to the publication - both in paper and digital format (e-books and audio-books) - of the fiction, non- fiction, children's and miscellaneous works by the publishing houses, which enable the Group to hold a leadership position at national level, with a market share of 27% at the end of 2022: Mondadori, Giulio Einaudi editore, Piemme, Sperling & Kupfer, Frassinelli, Rizzoli, BUR, Fabbri Editori, Rizzoli Lizard, Mondadori Electa and starting 1 April 2022 De Agostini Libri and, from 1 July 2022, Star Comics, Italy's leading comic books publisher, specialised in the publication on the domestic market of the major international productions including, in particular, Japanese manga; •art publishing where the Group operates under the Electa and Abscondita brands. The segment's activities envisage the publication of works on art, architecture, exhibition catalogues, museum guides and sponsor books in art publishing, whilst as regards the management of places of art and culture, the management of museum concessions owned by the Group and the organisation of exhibitions and cultural events; •the publishing house Rizzoli International Publications, which operates on the US market with the Rizzoli, Rizzoli New York, Rizzoli Electa and Universe brands and with the Rizzoli Bookstore located in New York; •the Education business unit operates in the field of school textbooks and legal publishing and, to a lesser extent, university textbooks. In school textbooks, the Group boasts a leadership position with an adoption share of 32.3%1 including the activities of D Scuola which, at end 2021, joined Mondadori Education and Rizzoli Education, strengthening the publishing offer of textbooks, courses, teaching tools, training courses and multimedia content for every school level, from primary school to middle and secondary schools, through to university publishing with a large catalogue of approximately 30 proprietary and distributed brands.


	RETAIL
		Through its wholly-owned subsidiary Mondadori Retail S.p.A., the Group manages the most extensive network of bookstores in Italy, with a 12.5%2 share in the books market. With a widespread presence throughout the Country and a business proposition focused on books (which account for over 80% of revenue), the company operates in the physical channel with over 500 directly-managed stores or franchised stores, under the Mondadori Bookstore, Mondadori Megastore and Mondadori Point brands, on the web with the e-commerce site Mondadoristore.it; these formats are complemented by the bookclub formula.

2022 ANNUAL FINANCIAL REPORT

1 Source: ESAIE, 2022 (adopted sections)


		MEDIA
		Mondadori Media S.p.A. is the wholly- owned subsidiary that groups together all of the Group's activities related to the development of print and digital brands from a multi-channel perspective: •the activities of print magazines and digital brands; •the subsidiaries Direct Channel S.p.A. (100%), AdKaora S.r.l. (100%), Hej! S.r.l. (100%), Mondadori Scienza S.p.A. (100%) and Zenzero S.r.l. (72%); •the investee companies Mediamond (50%), Attica Publications S.A. (41.98%), Mondadori Seec (Bejiing) Advertising Co. Ltd (50%) and Press-di Distribuzione Stampa e Multimedia S.r.l. (20%). With an audience of 27.7 million unique users per month3, 76 million fans and 9.2 million readers4, Mondadori Media retains its position as the top multimedia Italian publisher, a leader in digital and social media, as well as one of the largest players in magazines with a 21% market share (at December 2022). As at 31 December 2022, the company manages a portfolio of 15 titles, 13 digital brands and 110 social profiles, with a strong leadership in the vertical segments food, TV and health&wellness5. The Group is also active in the field of mobile advertising and proximity marketing through the company AdKaora in tech-advertising, with the company Hej! and in influencer marketing with Zenzero, the talent agency with the best Italian food creators.

3,4,5


	CORPORATE & SHARED SERVICES
		The Corporate Area includes - besides the top management organizations - Parent Company functions providing services that cut across the different companies and business areas of the Group. The area therefore includes administration, planning and control, treasury and finance, IT, logistics, HR management and organization, legal and corporate affairs, management of Group purchasing, general services, communications and media relations. Revenue comes mainly from consideration for services provided to subsidiaries and associates.


			19

2022 ANNUAL FINANCIAL REPORT

2 Source: GFK, December 2022 (in terms of value)

3 Source: Audiweb, December 2022

4 Source: Audipress III, 2022

5 Shareablee + Tik Tok and Pinterest, at 31 December 2022

2022 ANNUAL FINANCIAL REPORT

MONDADORI SHARE

Arnoldo Mondadori Editore S.p.A. ordinary

shares have been listed on the Italian Stock

Exchange since 1982 (ISIN Code:

IT0001469383).

Mondadori shares are included in the indexes

of the Italian Stock Exchange:

•general: FTSE Italia All Share, FTSE Italia

Star(since December 2016) and FTSE Italia

Mid Cap;

•industry specific: FTSE Italia Servizi al

consumo and FTSE Italia Media.

In 2022, Mondadori’s share traded at an

average price of € 1.83 (equivalent to an

average market capitalization of

approximately € 478 million), while the

volume traded on the market came to

approximately 253,900 average shares per

day. In 2022, Mondadori shares traded on the

market managed by Borsa Italiana S.p.A.

therefore reached the average daily

equivalent of more than € 0.5 million (a

maximum of € 6.5 million recorded on 14

January 2022)

On 30 December 2022, the last trading day of the year, Mondadori’s share recorded a closing price of

€ 1.81, with a market capitalization of approximately € 473 million.

The market highlights for 2022 are as follows::


Market data
General data	ISIN	IT0001469383
	No. Shares*	261,458,340
	Free float	46,3%
Price (€, %)	Closing price on 30/12/2021 in euros	2.04
	Closing price on 30/12/2022 in euros	1.81
	Annual performance %	-11,4%
	Average price in euros	1.83
	High in € (14/01/2022)	2.23
	Low in € (29/09/2022)	1.50
Volumes (thousands)	Average volume 2022	253.9
	Maximum volume (14/01/2022)	2,914.9
	Minimum Volume (01/11/2022)	16.5
Stock market capitalization (€ millions)	Average market capitalization	477.5
	Market capitalization at 30/12/2021	533.4
	Market capitalization at 30/12/2022	472.7

Source: FactSet

* Number of shares issued at 31 December 2022

2022 ANNUAL FINANCIAL REPORT

MONDADORI SHARE PRICE PERFORMANCE IN 2022

Source: FactSet

FINANCIAL MARKETS

2022 was a negative year for the international

financial markets, affected by geopolitical

tensions and high inflation: share prices

recorded more or less marked reductions in all

Eurozone countries and the United States of

America, with the “growth” segments penalised

in particular, in a general context of high

volatility and low liquidity, which particularly

struck SMEs.

Between mid-October and mid-December, the

conditions on the international financial markets

improved, thanks to the attenuation of

uncertainty and expectation for a slow-down of

the rate at which interest rates were being

raised by the monetary policy authorities, which

also fostered a reduction in volatility of share

prices, which in any case remained above pre-

pandemic levels.

Starting mid-October, Italy also showed an

improvement in the main conditions on the

financial markets: the slowing of the interest

rate growth and a perceived attenuation of the

country risk on the one hand fostered a decline

in long-term government security returns and

the sovereign risk premium, and on the other, a

recovery of share prices.

In this context, the Mondadori security

recorded an approximately 11% decline with

respect to the end of 2021, performance that

was better than all benchmarks: the main Italian

stock exchange index (FTSE Italia All Share) in

fact recorded a 14.1% decline, the FTSE Italia

STAR a 28.3% reduction and the FTSE Italia

Mid Cap a 21% drop, while the reference

industry index (FTSE Italia Media) recorded a

reduction of around 40%.

In greater detail, the performance of the

Mondadori security showed a downturn in the

central part of the year, in particular during the

second and third quarters, which was followed

by a significant increase in the last quarter of

the year, during which the security recorded

growth of around 18%.

2022 ANNUAL FINANCIAL REPORT

MONDADORI SHARE PRICE PERFORMANCE AGAINST MAIN SE INDEXES IN 2022

Fonte: FactSet

OWNERSHIP STRUCTURE

At 31 December 2022, the Company's share

capital amounts to € 67,979,168.40, equal to

261,458,340 ordinary shares with a par value of

€ 0.26 each.

CORPORATE STRUCTURE

At the same date, to the knowledge of the

Company, based on the disclosures received

pursuant to Article 120 of the TUF and other

available information, the Company ownership

structure includes the following relevant

investments (above 5% of the share capital6):

2022 ANNUAL FINANCIAL REPORT

6 Pursuant to Article 120 of the TUF, in companies whose Bylaws allow for the increased voting right or have provided for

the issue of multiple voting shares, share capital means the total number of voting rights.

INVESTOR RELATIONS ACTIVITIES

The Mondadori Group pursues a policy of

communication vis-à-vis the financial market

players, hinged on the disclosure of complete,

true and correct news on corporate results,

initiatives and strategies, in accordance with

the rules set by CONSOB and Borsa Italiana

and by confidentiality requirements that certain

information may need, paying particular

attention to ensure transparent and timely

information to facilitate relations with the

financial community, also through the adoption

of specific procedures.

The Company's presence on the STAR

segment of Borsa Italiana (transition completed

in December 2016) continued to qualify

Mondadori as one of the top-ranking

companies listed on the Italian market, thanks

also to a corporate governance aligned with

the best international standards.

Top managers meet regularly with investors

and financial analysts to discuss the Group's

prospects, growth strategy and goals, as well

as the risks and opportunities arising from the

evolving competitive environment, and to shed

light on its periodic results.

In 2022, renewed drive was noted, thanks to

the cessation of difficulties arising from the

pandemic period, which had prevented the

typical organization of roadshows and

“physical” meetings with institutional investors,

with a continuation of communication activities

and the development of relations with

shareholders, institutional investors and

financial analysts through numerous meetings

organised in Europe's most important financial

marketplaces (during which approximately 200

institutional investors were met), in order to

guarantee the Mondadori Group increasing

visibility and better consideration of its

business, as well as to affirm the credibility of

its management team and strategies amongst

the financial community.

In 2022, the company also saw an increase in

coverage by financial brokers: in February, in

fact, security coverage was launched by Intesa

Sanpaolo, whilst in September, EXANE BNP

PARIBAS published its first research. At the end

of the year, 7 brokers therefore guarantee

active coverage of the security.

The Group's economic-equity solidity and the

demonstration of its capacity to grow, including

through acquisitions, have allowed the

Mondadori share to consolidate its positive

reputation in the eyes of the financial

community, as confirmed by the

recommendations of financial analysts which, at

31 December 2022, are all positive (BUY/

OUTPERFORM).

The following are all of the scheduled events

for the current year regarding the disclosure of

financial results.


2023 Financial Calendar
27/04/2023	Shareholders' Meeting to approve the financial statements at 31 December 2022
10/05/2023	Approval of additional periodic financial reporting at 31 March 2023
01/08/2023	Approval of the half-year report at 30 June 2023
08/11/2023	Approval of additional periodic financial reporting at 30 September 2023

2022 ANNUAL FINANCIAL REPORT

SUSTAINABILITY

STRATEGY

The Mondadori Group has reached a level of

readiness in the area of sustainability that has

enabled it to shift from a timely reporting, in line

with GRI Standards, to a strategic approach

that has defined ESG guidelines, in line with

the objectives launched at global level by the

United Nations.

This allowed Mondadori, in 2022, to define the

first Three-Year Sustainability Plan, within

which strategic areas, quantitative and

qualitative targets and short- and medium-term

actions have been identified, aimed at assuring

the continuous improvement of social,

governance and environmental performance.

Constant monitoring has been carried out of

the quantitative objectives set, which has made

it possible, on the one hand, to provide a

timely image of the degree to which they

have been achieved and, on the other, to

identify new action for the future, to continue

updating the Plan.

During the first half of the year, after a

benchmark and positioning study, as well as an

assessment of corporate priorities, the

materiality analysis was carried out, consistently

with the strategic guidelines defined in the

Plan. The work led to the identification of areas

of impact (current and potential) on the

economy, people and environment most

relevant to the Group.

This mapping was accompanied by moments of

listening to our stakeholders, which saw the

active involvement of company management,

employees and other relevant stakeholders,

such as teachers and customers of the

bookstores. For the first time, two new

categories of stakeholders were also included -

suppliers and analysts - identified on the basis

of criteria of strategic relevance for the Group,

both in terms of business and sustainability.

The overall results of the analysis have led to

the identification of the material topics that

are priorities for Mondadori, on which the

Group will continue to work determinedly and

carefully, with a view to assuring ongoing

improvement.

The achievement of the objectives defined for

2022 in our Sustainability Plan and the

identification of new areas of strategic

intervention for the next three years reflect the

company’s commitment in the three ESG

reference areas.

The Sustainability Plan offers a natural

expression of the Group's identity, its mission

and its role as publisher in society.

2022 ANNUAL FINANCIAL REPORT


SOCIAL - Enhancing people, content and places for education and culture 1.To become a role model in the field of diversity, equity and inclusion, enhancing and contributing to the well-being of our people, through welfare tools and skills development. 2.To promote culture and quality, equitable, and inclusive education that fosters pathways to lifelong learning. 3.To create, conceive and develop valuable content and accessible, ESG-friendly products. 4.To support cultural outposts for social development through the enhancement of bookstores, schools, museums, social channels, events and partnerships.		GOVERNANCE - Promoting sustainable business success 1.To pursue sustainable business success by promoting the integration of ESG issues in governance, business plans and the operating model, also by strengthening the mechanisms for listening to stakeholders to develop paths of ongoing improvement. 2.To maintain the highest standards for protecting and managing risks and opportunities along the value chain.		ENVIRONMENT - Dissemination of an environmental culture and mitigation of impacts on ecosystems 1.To spread environmental culture, also through education aimed at the development of an increasingly sustainable lifestyle. 2.To mitigate environmental impacts throughout the print product life cycle, by fostering the protection of biodiversity and reducing climate-changing emissions.

2022 ANNUAL FINANCIAL REPORT

#NoiDellaMondadori

In 2022, the Mondadori Group's social profiles continued to report on the news and initiatives that directly involved people in our

Company and the various work teams. On this page, from top-left: colleagues from the Group Services Purchasing and Real Estate

Department; the Giallozafferano team, winner of the YouTube "Gold Creator Award" for having reached one million subscribers to its

channel; the group of new booksellers affiliated with the Mondadori Store network; the team from the Directorate General of Operations

- Trade Area; the Urania team celebrating the seventieth anniversary of the series; the Hub Scuola team, winner of the "Silver Creator

Award" for producing more than 3,700 high quality educational videos on the Youtube channel.


	Directors’ Report on Operations in 2022

MONDADORI GROUP

HIGHLIGHTS IN 2022


(Euro/millions)	FY 2022	FY 2022 excl. D Scuola	FY 2021	% chg.
Income Statement	FY 2022	FY 2022 excl. D Scuola	FY 2021	% chg.

Revenues	903.0	827.6	807.3	11.8%
Adjusted EBITDA*	136.3	113.1	105.7	28.9%
EBITDA	130.7	108.4	91.1	43.4%
EBIT	72.7	59.5	45.2	60.8%
Adjusted EBIT**	90.1		67.8	32.9%
Group net result	52.1	42.3	44.2	17.8%
Adjusted Net Profit***	63.9		42.4	50.7%

Business Areas
Revenues	903.0	827.6	807.3	11.8%
Books	576.2	499.5	465.0	23.9%
Retail	189.2	189.2	173.9	8.8%
Media	177.8	177.8	206.6	(13.9%)
Corporate & Shared Services	41.5	41.5	40.9	1.5%
Intercompany	(81.7)	(80.5)	(79.0)	3.4%
Adjusted EBITDA	136.3	113.1	105.7	28.9%
Books	118.5	95.3	92.6	28.0%
Retail	9.1	9.1	5.1	77.3%
Media	14.1	14.1	12.4	13.8%
Corporate & Shared Services	(5.4)	(5.4)	(4.2)	28.6%
Intercompany	—	—	(0.1)	(135.1%)

Balance Sheet
Group Equity	259.6		219.6	18.2%
Net Invested Capital	438.2		398.7	9.9%
Net Financial Position no IFRS 16	106.1		94.8	12.0%
Net Financial Position IFRS 16	177.4		179.1	(0.9%)

Operating and Financial Indicators
Adj. EBITDA on Revenue (%)	15.1%	13.7%	13.1%
Net result on Revenue (%)	5.7%	5.1%	5.5%
ROE	20.0%		20.1%
ROI	11.9%		11.1%
EPS (Euro)	0.20		0.17
DPS (Euro)	0.11		0.09

Human resources
End-of-year headcount	1,900	1,775	1,810	5.0%

Changes in this report were calculated on amounts expressed in Euro thousands

The “FY 2022 excl. D Scuola” column shows the operating and financial figures at 31 December 2022 excluding D Scuola

* Gross operating profit before income and expenses of a non-ordinary nature

** EBIT excluding non-ordinary income and expense, depreciation and amortization deriving from the company purchase price allocation and the

impairment of intangible assets

*** Adjusted Net Profit is calculated excluding non-ordinary income and expense, depreciation and amortisation deriving from the company purchase

price allocation and the impairment of intangible assets net of the related tax effect. Any non-recurring tax expense/income is also excluded.

PERFORMANCE OF MAIN INCOME INDICATORS

(Euro/millions)

REVENUE BY BUSINESS 2022

ADJ. EBITDA BY BUSINESS 2022

In order to provide a clear presentation, the Media Area is broken down into the two components Print and Digital.

Revenues by business, gross of Corporate and Intercompany revenues; Adjusted EBITDA gross of Corporate EBITDA.

2022 ANNUAL FINANCIAL REPORT

FY 2022 saw the Group complete its strategic

reconfiguration of its portfolio of activities,

which resulted in a significant lightening of its

exposure in magazines and a strengthening of

book publishing and which will now continue

with an exclusive focus on developing the

core businesses.

During the year in fact, the Group has

completed/announced several extraordinary

transactions, the most noteworthy of which

include:

•as regards the core business of Books, with a

combined strategy of vertical integration in

the chain and strengthening of publishing

leadership:

–the acquisition of 50% of De Agostini

Libri, operating in the trade books

segment with focus on the children's and

non-fiction areas and of the subsidiary

Libromania, operating in the promotion of

third-party publishers;

–the acquisition, with a view to

strengthening distribution of third-party

publishers, of 50% of A.L.I. - Agenzia

Libraria International, which, starting

2023, following the acquisition of an

additional 25% stake, will be fully

consolidated;

–the acquisition of 51% of Star Comics,

thanks to which the Group has become

the Italian leader of the comics segment.

•As regards the Media Print business, with a

view to pursuing the process of reducing

exposure to the segment:

–the sale of the majority of Press-di,

operating in the nationwide distribution of

magazines and newspapers;

–the start of the sale process of the

business unit for the Grazia and Icon

brands, including the related international

network, a transaction that was then

finalised in January 2023.

The Group’s financial and economic profile in

2022 shows, despite the as-yet incomplete

reflection in view of the partial consolidation,

the positive impacts of these repositioning

initiatives and the related contribution towards

the Group's profitability, which have made it

possible, coupled with the prompt action taken

by the management to increase efficiency, to

combat the effects of the uncertain economic

and geopolitical context that have

characterised the entire year and the significant

increase in the main production factors.

This enabled the Group to record, at

consolidated level, with regard to all the

relevant metrics, results higher than the

guidance repeatedly disclosed to the market,

despite the fact that they had been

repeatedly improved during the year:

•the Group’s revenues showed approximately

12% growth (above the high-single digit

guidance), which was particularly impacted by

both the inclusion in the consolidation scope

of D Scuola and the positive Book market

dynamics, which benefited the Trade and

Retail areas;

•Adjusted EBITDA, of approximately € 136

million showed an increase of approximately

€ 31 million, namely 29% growth (the

guidance estimated an increase by 25% or

more): approximately one third of this

significant increase derives from the

operating performance of the original scope

thanks to the greater efficiency achieved and

approximately two thirds from the

consolidation of D Scuola. In all, profitability

came to 15.1%, up a good 2 percentage

points, from the 13.1% in 2021;

•net profit is € 52.1 million, up 18% (guidance:

double-digit growth) and is the best result

recorded by the Group in the last 15 years;

neutralising the inoperative effects that had

influenced FYs 2021 and 2022, adjusted net

profit would be up by more than 50%,

coming to around € 65 million;

•in addition to the buoyant performance of

operations, during the period the Group

confirmed solid cash generation with cash

flow from ordinary operations of

approximately € 70 million (guidance: € 68

million);

•the Net Financial Position (before IFRS 16)

came to approximately € 106 million;

considering, vice versa, the effects of IFRS 16,

the NFP was € 177.4 million, below the (179.1)

million of December 2021, with an NFP/

Adjusted EBITDA ratio at 1.3x, exactly in line

with the objective. The essential invariance of

the Net Financial Position between 2021 and

2022 shows the Group's capacity to self-

finance with its own cash generation the

active M&A policy implemented, without

compromising the distribution of significant

dividends to shareholders.

Directors' Report on the Group’s Operations in 2022

2022 in fact saw a return to a shareholder

remuneration policy through the distribution of

dividends for a total amount of approximately €

22 million, equivalent to a pay-out of 50% the

2021 net profit; in respect of the 2022 result,

the Board of Directors has proposed to the

Shareholders’ Meeting to pay its shareholders

approximately € 28.7 million (€ 11 cents per

share), an increase of almost 30% compared

with last year: this amount corresponds to a

pay-out of 55% the 2022 net profit and a

dividend yield of 6% (at 31 December 2022).

The dividend will be paid, in accordance with

the provisions of the Regulation of the markets

organized and managed by Borsa Italiana

S.p.A., from 24 May 2023 (payment date), with

ex-coupon date on 22 May 2023, and with the

date of entitlement to payment of the dividend,

pursuant to Article 83-terdecies of the TUF

(record date), on 23 May 2023.

2022 ANNUAL FINANCIAL REPORT

MARKET AND BUSINESS

AREA HIGHLIGHTS OF

THE GROUP

In FY 2022, after the extraordinary growth seen

the previous year, the book market

experienced a phase of essential stability

(+0.2% in value) with a slight growth trend seen

during the second part of the year (+1.8% yoy

value).

With the Trade Books area, the Group has

recorded a growth in sell-out at market value

of 2.2% compared with 2021. This performance

has allowed Mondadori to retain once again its

undisputed leadership at a national level in

the Miscellaneous publishing segment

(including comics), showing market share

growth (which had not been recorded for 5

financial years), which thanks to both the

performance of the publishing houses and the

positive performance of the newly-acquired

Star Comics, came in at year end at 27%.

In the school textbooks segment, following the

2022 adoption campaign, the Group has

shown, in a market that is essentially steady in

value compared with last year, a stable market

share (32.3%), thereby confirming the positive

results achieved and the quality of the

publishing proposals of all three its publishing

houses.

The Retail area has also shown a clear

improvement in its performance and

progressive growth in revenues, which,

compared with 2021, rose by 9%, largely due to

books, whose sales during the year increased

by 11.5%.

FY 2022 saw the Media area downsize its Print

component further - in particular of activities

relating to advertising sales:

•during the year, the sale was completed of

the magazines announced late 2021 (Donna

Moderna and Casa Facile);

•the effects of the sale of the distribution

business are instead still partial in FY 2022,

given that Press-di was deconsolidated

during the second half of the year;

The sale of the Grazia and Icon brand business

during the last quarter of 2022 was finalised in

January 2023 and consequently is made

concrete in the results of FY 2023.

The area is therefore confirmed as ever more

“digital”: indeed, in 2022, the Group’s digital

business - which grew by around 15% brand-

for-brand - accounted for 27% of the area’s

revenues (from 21% in 2021).

Directors' Report on the Group’s Operations in 2022

2022 CONSOLIDATED FINANCIAL HIGHLIGHTS


(Euro/millions)	2022		2022 excl. D Scuola		2021		Change%	Change % Excl. D Scuola

Revenues	903.0		827.6		807.3		11.8%	2.5%
Industrial product cost	295.8	32.8%	276.8	33.5%	246.6	30.5%	20.0%	12.3%
Variable product costs	111.8	12.4%	106.5	12.9%	114.0	14.1%	(2.0%)	(6.6%)
Other variable costs	165.2	18.3%	148.7	18.0%	163.3	20.2%	1.2%	(9.0%)
Structural costs	60.0	6.6%	57.0	6.9%	51.1	6.3%	17.5%	11.6%
Extended labour cost	142.3	15.8%	133.5	16.1%	134.9	16.7%	5.4%	(1.1%)
Other expense (income)	(8.4)	(0.9%)	(8.1)	(1.0%)	(8.3)	(1.0%)	1.5%	(2.4%)

Adjusted EBITDA	136.3	15.1%	113.1	13.7%	105.7	13.1%	28.9%	7.0%

Renovations	3.7	0.4%	3.5	0.4%	11.2	1.4%	(66.7%)	(69.0%)
Extraordinary expense (income)	1.9	0.2%	1.2	0.2%	3.4	0.4%	(44.7%)	(63.2%)

EBITDA	130.7	14.5%	108.4	13.1%	91.1	11.3%	43.4%	18.9%

Amortisation and depreciation	36.7	4.1%	28.1	3.4%	25.1	3.1%	45.9%	11.7%
Impairment and write-downs	7.2	0.8%	7.2	0.9%	7.4	0.9%	n.s.	n.s.
Amortization and depreciation IFRS 16	14.1	1.6%	13.6	1.6%	13.4	1.7%	5.1%	1.2%

EBIT	72.7	8.1%	59.5	7.2%	45.2	5.6%	60.8%	31.6%

Financial expense (income)	5.2	0.6%	5.1	0.6%	2.5	0.3%	108.9%	104.1%
Financial expense IFRS16	0.5	0.1%	0.5	0.1%	2.2	0.3%	(78.4%)	(78.9%)
Financial expense (income) from securities valuation	—	—%	—	—%	0.4	0.1%	n.s.	n.s.
Expense (income) from investments	0.2	—%	0.2	—%	1.5	0.2%	n.s.	n.s.

EBT	66.9	7.4%	53.8	6.5%	38.6	4.8%	73.3%	39.4%

Tax expense (income)	15.3	1.7%	11.9	1.4%	(5.6)	(0.7%)	n.s.	n.s.

Net result for the period (group and non-controlling interests)	51.5	5.7%	41.8	5.1%	44.2	5.5%	16.6%	(5.4%)

Minorities	(0.5)	(0.1%)	(0.5)	(0.1%)	—	—%	n.s.	n.s.

Group net result	52.1	5.8%	42.3	5.1%	44.2	5.5%	17.8%	(4.2%)

Cost of personnel includes costs for collaborations and temporary employment.

In FY 2022, for the purposes of greater comparability with 2021, in the column "2022 excl. D Scuola”, the reclassified Income

Statement and Statement of Financial Position show the operating and financial figures at 31 December 2022 excluding D Scuola,

a company acquired late December 2021 (fully consolidated at profit and loss as from 1 January 2022 and at equity level as from

31 December 2021).

2022 ANNUAL FINANCIAL REPORT

ALTERNATIVE PERFORMANCE MEASURES

This document, in addition to the conventional statements and financial measures required by IFRS,

presents a number of reclassified statements and alternative performance measures in order to

provide a better understanding of the operating and financial performance of the Group, the definition

of which is explained in the section “Glossary of terms and alternative performance measures used”.

As already specified, two additional information items have been included in this document: adjusted

EBIT1 and adjusted net profit2.

Directors' Report on the Group’s Operations in 2022

1 Excluding non-ordinary income and expense, non-monetary costs deriving from the company purchase price allocation

and the impairment of intangible assets

2 Calculated excluding non-ordinary income and expense, depreciation and amortisation deriving from the company

purchase price allocation and the impairment of intangible assets net of the related tax effect. Any non-recurring tax

expense/income is also excluded

INCOME STATEMENT

REVENUES

Consolidated revenue in FY 2022 amounted to

€ 903.0 million, increasing by 11.8% versus €

807.3 million in the prior year; net of the

consolidation of D Scuola, effective 1 January

2022, Group revenue grew by 2.5%, thanks to

the performance of the Books and Retail

areas and despite the additional asset sales

involving the Media area: net of all the effects

from the changed consolidation scope, the

Group's organic revenue growth would have

been approximately 4%.

In the Books area, revenue rose by 23.9%(or

7.4% without D Scuola), thanks in particular to

the growth in sales of Trade publishing houses

- driven also by the consolidation, as of 1 July

2022, of Star Comics- and the resumption of

activities related to the management of

museums and cultural assets.

The Retail area reported revenue growth of

8.8%, driven mostly by the book product

( which grew by 11.5%), attributable mainly to

the directly-managed bookstore channel,

whose performance in the prior year was

burdened by the restrictions brought by the

COVID-19 emergency.

The Media area showed revenue declining by

13.9%, due to the changes in the consolidation

scope that took place: on a like-for-like basis,

total revenue of the Media area rose slightly by

1.8% compared with FY 2021, thanks in

particular to the positive performance of digital

advertising sales, up around 15%, which more

than offset the decline in circulation revenue of

the titles and add-on sales


REVENUES by Business Area	2022	2022 excl. D Scuola	2021	Change %	Change % Excl. D Scuola
(Euro/millions)	2022	2022 excl. D Scuola	2021	Change %	Change % Excl. D Scuola

Books	576.2	499.5	465.0	23.9%	7.4%
Retail	189.2	189.2	173.9	8.8%	8.8%
Media	177.8	177.8	206.6	(13.9%)	(13.9%)
Corporate & Shared Services	41.5	41.5	40.9	1.5%	1.5%
Total aggregated revenue	984.7	908.0	886.4	11.1%	2.4%

Intercompany	(81.7)	(80.5)	(79.0)	3.4%	1.8%
Total consolidated revenue	903.0	827.6	807.3	11.8%	2.5%

2022 ANNUAL FINANCIAL REPORT

EBITDA

EBITDA ADJUSTED

Adjusted EBITDA in 2022 came to € 136.3

million; excluding the result of D Scuola,

adjusted EBITDA came to a positive € 113.1

million: the Group thus showed an overall

improvement in profitability of around € 31

million versus 2021, when the result was €

105.7 million, up by 29%, approximately one

third of which attributable to the positive

performance across all business areas, Books

and Retail in particular, and approximately two

thirds from the contribution of D Scuola (€ 23.2

million).

The reduction versus 2021 in the ratio of costs

(variable costs and payroll costs) on Group

revenue enabled it to increase its margins to

over 15% (from 13.1% the previous year): net of

the relief received to aid museum activities in

both years, the Group's margin would have

respectively been 12.7% in 2021 and 14.4% in

2022.

This significant result was achieved despite the

considerable increase in costs relating to

energy consumption and paper purchases,

equal to a total of € 15 million: the average

cost of procurement of paper in fact rose for

the Group by more than 50%, which has

translated into incremental costs for

approximately € 12 million for the Group.

More specifically, the various business

segments achieved the following results:

•the Books area recorded an overall growth

in margins of over € 26 million during the

year; without D Scuola, the increase amounts

to € 2.7 million, thanks to the positive

performance of the Trade publishing houses

(which also benefited from the consolidation

of Star Comics), the upswing in museum

activities and those related to the

concessions managed by Electa, and to the

increased relief granted to the latter;

•the Retail area recorded an improvement of

€ 4 million, thanks to the growth posted by

book product sales and the ongoing deep

renewal of the network of physical stores,

despite higher costs for utilities of € 1.4

million;

•the Media area grew by € 1.7 million, thanks

to the continued costs-curbing measures in

the print area and the accounting of the tax

credit recognized on paper consumption,

which allowed it to reduce the negative

impact on profitability resulting from the

increase in the cost of raw materials;

•the Corporate & Shared Services area

recorded a negative margin of € 5.4 million,

down from € -4.2 million in 2021, due mainly

to the increase in utility costs amounting to

approximately € 1.3 million for management

of the Segrate HQ.

Directors' Report on the Group’s Operations in 2022


Adj. EBITDA by business area	2022	2022 excl. D Scuola	2021	Change	Change excl. D Scuola
(Euro/millions)	2022	2022 excl. D Scuola	2021	Change	Change excl. D Scuola

Books	118.5	95.3	92.6	25.9	2.7
Retail	9.1	9.1	5.1	4.0	4.0
Media	14.1	14.1	12.4	1.7	1.7
Corporate & Shared Services	(5.4)	(5.4)	(4.2)	(1.2)	(1.2)
Intercompany	—	—	(0.1)	0.2	0.2

Total ADJUSTED EBITDA	136.3	113.1	105.7	30.6	7.4

REPORTED EBITDA

EBITDA, coming to € 130.7 million (or € 108.4

million without D Scuola) compared with 91.1

million in 2021, showed an even more marked

improvement of € 39.6 million (+43%), due to

the phenomena and trends mentioned above,

as well as to the reduction, versus the prior

year, of restructuring costs, particularly evident

in the Media and Corporate areas, as better

detailed below; the Media area also benefited

from the booking of a capital gain deriving from

the sale of the majority share in Press-di.


EBITDA by Business Area	2022	2022 excl. D Scuola	2021	Change	Change excl. D Scuola
(Euro/millions)	2022	2022 excl. D Scuola	2021	Change	Change excl. D Scuola

Books	114.9	92.6	90.1	24.9	2.5
Retail	8.2	8.2	3.7	4.5	4.5
Media	14.0	14.0	7.1	6.8	6.8
Corporate & Shared Services	(6.4)	(6.4)	(9.6)	3.2	3.2
Intercompany	0.1	0.1	(0.1)	0.2	0.2

Total EBITDA	130.7	108.4	91.1	39.6	17.2

2022 ANNUAL FINANCIAL REPORT

EBIT

Mondadori Group EBIT in FY 2022, which came

to € 72.7 million or 59.5 million excluding the

contribution of D Scuola, showed clear

improvement on 2021; revealing:

•an improvement in the overall scope of €

27.5 million - equating to approximate growth

of 61% - despite the impact of greater

depreciation and amortisation, of

€ 4.7 million deriving from the purchase price

allocation of goodwill emerging from the

acquisitions completed (D Scuola in

particular);

•an improvement, excluding the contribution of

D Scuola, of € 14.3 million, attributable to the

abovementioned operational dynamics.

EBIT for FY 2022 also includes some write-

offs, for a total value of € 7.2 million (from € 7.4

million in 2021), deriving from the impairment

process, (relative in particular to the brand TV

Sorrisi & Canzoni in the Media area, on which

the increase in the discount rates used had its

main impact).

2022 adjusted EBIT, net of extraordinary

expense and all non-monetary items relating to

the purchase price allocation and impairment

processes, would be € 90.1 million, up by

more than € 22 million compared with the

previous year.


EBIT by business area	2022	2022 excl. D Scuola	2021	Change	Change excl. D Scuola
(Euro/million)	2022	2022 excl. D Scuola	2021	Change	Change excl. D Scuola

Books	88.6	75.4	74.0	14.6	1.4
Retail	(0.9)	(0.9)	(6.6)	5.7	5.7
Media	0.9	0.9	(2.9)	3.8	3.8
Corporate & Shared Services	(15.9)	(15.9)	(19.1)	3.2	3.2
Intercompany	0.1	0.1	(0.1)	0.2	0.2
Consolidated EBIT	72.7	59.5	45.2	27.5	14.3

Adjusted EBIT	90.1		67.8	22.3

ADJUSTED EBIT

Directors' Report on the Group’s Operations in 2022

CONSOLIDATED RESULT BEFORE TAX

Consolidated profit before tax came to € 66.9

million versus € 38.6 million in 2021.

On top of that, the following factors also

contributed to the significant increase of

approximately € 28 million:

•the FY 2022 improvement of € 1.3 million,

seen in the result of investees, attributable to

the sale on 1 January 2022, of the investment

in Monradio (which usually recorded losses)

and to the start of the accounting of the share

of the profits of A.L.I.3, which more than offset

the impairment of € 1.7 million of the

investment held in Attica;

•the recognition in 2021 of a capital loss of €

0.4 million resulting from the sale in February

2021 of the last tranche of the investment in

Reworld Media4.

Total period financial expense, which came to

€ 5.7 million, is up € 1 million:

•the more favourable terms that characterise

the new loans stipulated by the Group have,

in FY 2022, made it possible to limit the cost

of debt, despite the Group’s greater financial

exposure during the year (gross average debt

of € 202 million vs 125 million in 2021)

following the acquisition of D Scuola. The

average cost of debt in fact, including

ancillary expense ("all-in cost"), was 1.83%

compared with 1.88% in FY 2021, despite the

fact that 2021 had benefited from a net non-

recurring income deriving from the

application of IFRS 9 to the terms of the pool

refinancing subscribed by the Group in 2021;

the average interest rate applied was 0.47%

in 2022, compared with 0.59% in FY 2021;

•financial expense for FY 2022 also includes

the new assessment of the earn-out relative

to the acquisition of Hej (€ 0.9 million)

envisaged by the contract that regulated the

transaction;

•financial expense from the application of IFRS

16 was significantly better than in 2021,

thanks to the recognition of non-recurring

income of approximately € 1.4 million from the

early termination of the old lease contract for

the Segrate HQ (the new contract was signed

in July 2022).

2022 ANNUAL FINANCIAL REPORT

3 On 11 May 2022, the Group completed the acquisition of a 50% stake in the share capital.

4 The monetization of this investment generated a total gain (2019-2021) of € 1.1 million.

NET RESULT

ADJUSTED NET PROFIT

The Group's net profit, after minority interests,

came to € 52.1 million (or €42.3 million without

D Scuola), a sharp increase of approximately 8

million versus € 44.2 million recorded in 2021.

Mention should be made that the 2021 result

had benefited from non-recurring tax income

of € 18.7 million, which included the

realignment of the tax amounts of trademarks

and goodwill to their respective statutory

amounts.

The tax charge for the period in fact, unaffected

by non-ordinary items, closed with a negative €

15.3 million compared to a positive figure of

€5.6 million recorded as at 31 December 2021.

Adjusted net profit for FY 2022, neutralising all

items previously mentioned and the one-off tax

income from which FY 2021 had benefited,

would come to approximately € 64 million, up

by around 51% on the previous year.(€42.4

million).

Directors' Report on the Group’s Operations in 2022

FINANCIAL RESULTS


(Euro/millions)	2022	2021	Change %

Trade receivables	161.2	165.0	(2.3%)
Inventory	151.4	120.6	25.5%
Trade payables	252.7	223.0	13.3%
Other assets/ (liabilities)	(45.7)	(42.0)	n.s.

Net working capital from continuing operations	14.2	20.6	(31.1%)

Discontinued or discontinuing assets (liabilities)	(0.4)	(8.0)	(95.6%)

Net working capital	13.9	12.7	9.5%

Intangible assets	372.3	351.8	5.8%
Tangible assets	24.1	14.6	65.4%
Investments	29.7	18.7	58.8%

Net fixed assets with no rights of use IFRS16	426.2	385.2	10.7%

Assets from rights of use IFRS16	68.5	80.7	(15.2%)

Net fixed assets with rights of use IFRS16	494.6	465.9	6.2%

Provision for risks	41.9	47.1	(11.0%)
Post-employment benefits	28.3	32.8	(13.6%)

Provisions	70.3	79.9	(12.0%)
Net invested capital	438.2	398.7	9.9%

Share capital	68.0	68.0	—%
Reserves	139.5	107.4	29.9%
Profit (loss) for the year	52.1	44.2	17.8%

Group shareholders’ equity	259.6	219.6	18.2%

Minority shareholders’ equity	1.3	—	n.s.

Net equity	260.8	219.6	18.8%

Net financial position excluding IFRS16	106.1	94.8	12.0%
Net Financial Position IFRS 16	71.3	84.3	(15.5%)

Net financial position	177.4	179.1	(0.9%)
Sources	438.2	398.7	9.9%

Under the agreement for the sale of the majority of the investment in Press-Di Distribuzione Stampa Multimedia S.r.l., the sale of the business units

comprising the publishing activities of the titles Donna Moderna and CasaFacile, and the January 2023 sale of the business unit relating to the

activities of the Grazia and Icon brands, the equity values of the above assets at 31 December 2021, and for the sake of proper comparison, at 31

December 2021, were restated in accordance with IFRS 5, under “Discontinued or discontinuing operations" and under "Liabilities disposed of or

being disposed of".

2022 ANNUAL FINANCIAL REPORT

NET INVESTED CAPITAL

The Group's Net Invested Capital at 31

December 2022 stood at € 438.2 million, up

by approximately 10% versus € 398.7 million at

31 December 2021.

The Group's Net Working Capital (of operating

assets) amounted to € 14.2 million, down

versus € 20.6 million of the prior year.

Net Fixed Assets amounted to € 426.2 million,

up versus € 385.2 million at 31 December 2021,

as a result of the increase in intangible assets

due mainly to the recognition of goodwill

emerging from the acquisition of Star Comics -

and the investments following the acquisition of

50% of A.L.I..

Net Fixed Assets (including IFRS 16) came to €

494.6 million, up by approximately € 29 million

on the € 465.9 million in 2021, due to the

increase in intangible assets - due mainly to the

recognition of goodwill emerging from the

acquisition of StarComics - and the investments

- due to the acquisition of 50% of A.L.I. - that

more than offset the decline in right of use

assets (IFRS 16), mainly deriving from the

stipulation of the new rental contract for the

Segrate headquarters.

Excluding the effects of IFRS 16, Net Fixed

Assets come to € 426.2 million, up on the €

385.2 million of 2021.

SOURCES

Consolidated equity at 31 December 2022 has

increased by about € 41 million compared with

the previous year, due to the positive results

achieved by the Group during the year, the

increase in the reserve for the measurement of

derivatives and despite the distribution of

dividends of € 22.2 million.

The Net Financial Position excluding IFRS 16

came to approximately € 106.1 million (net

debt) only slightly up on the end-2021 figure,

despite the cash-out relating to acquisitions

made during the year and the distribution of

dividends.

The IFRS 16 Net Financial Position at 31

December 2022 stood at € 177.4 million and

reflects the recognition of the financial payable

from the application of IFRS 16 (€ 71.3 million).

Directors' Report on the Group’s Operations in 2022

CASH FLOW FROM ORDINARY

OPERATIONS

The cash flow from ordinary operations (after

outlays for financial expense and tax),

amounting to € 70.2 million and allows the

Group to continue to strengthen its financial

structure.

Note that ordinary cash generation was

impacted as follows:

•positively by the contribution of D Scuola (€

8.3 million) and the impact of derivatives

relating to interest rate hedges;

•negatively by the greater investments made

by the Group for approximately € 19 million (in

the Education - also due to the consolidation

of D Scuola - and Retail areas).

FREE CASH FLOW

At 31 December 2022, cash flow from

extraordinary operations came to a negative

€ 59.5 million, mostly due to cash out for

restructuring costs of € 8.8 million and for the

net balance of acquisitions and disposals of

approximately € 43 million.

Consequently, free cash flow for FY 2022 was

positive for approximately € 11 million,

showing the Group’s capacity to finance its

inorganic growth policy.

Finally, in FY 2022, the Group distributed

dividends to its shareholders for

approximately € 22 million.

2022 ANNUAL FINANCIAL REPORT

CONSOLIDATED

FINANCIAL HIGHLIGHTS

IN FOURTH QUARTER


(Euro/millions)	Q4 2022		Q4 2022 excl. D Scuola		Q4 2021		Change %	Change % Excl. D Scuola

Revenues	224.8		216.3		218.43		2.9%	(1.0%)
Industrial product cost	84.8	37.7%	81.6	37.7%	73.37	33.6%	15.5%	11.3%
Variable product costs	29.7	13.2%	29.4	13.6%	31.41	14.4%	(5.4%)	(6.3%)
Other variable costs	36.0	16.0%	35.3	16.3%	45.64	20.9%	(21.1%)	(22.7%)
Structural costs	17.0	7.6%	16.4	7.6%	14.43	6.6%	17.8%	13.7%
Extended labour cost	36.9	16.4%	34.7	16.0%	35.72	16.4%	3.2%	(2.9%)
Other expense (income)	(0.4)	(0.2%)	(0.2)	(0.1%)	(2.84)	(1.3%)	n.s.	n.s.

Adjusted EBITDA	20.8	9.3%	19.1	8.8%	20.71	9.5%	0.6%	(8.0%)

Renovations	2.7	1.2%	2.5	1.1%	8.05	3.7%	(66.3%)	(69.4%)
Extraordinary expense (income)	1.9	0.8%	1.2	0.6%	2.01	0.9%	(7.8%)	(38.9%)

EBITDA	16.3	7.2%	15.4	7.1%	10.65	4.9%	52.8%	44.3%

Amortisation and depreciation	10.6	4.7%	8.4	3.9%	6.63	3.0%	59.9%	26.0%
Impairment and write-downs	7.2	3.2%	7.2	3.3%	7.37	3.4%	n.s.	n.s.
Amortization and depreciation IFRS 16	3.7	1.7%	3.6	1.7%	3.45	1.6%	7.5%	3.8%

EBIT	(5.3)	(2.3%)	(3.8)	(1.8%)	(6.80)	(3.1%)	n.s.	n.s.

Financial expense (income)	2.4	1.1%	2.3	1.1%	0.25	0.1%	n.s.	n.s.
Financial expense IFRS16	0.5	0.2%	0.5	0.2%	0.54	0.2%	n.s.	n.s.
Financial expense (income) from securities valuation	—	0.0%	—	0.0%	—	0.0%	n.s.	n.s.
Expense (income) from investments	0.8	0.4%	0.8	0.4%	(1.41)	(0.6%)	n.s.	n.s.

EBT	(8.9)	(4.0%)	(7.4)	(3.4%)	(6.19)	(2.8%)	n.s.	n.s.

Tax expense (income)	(2.3)	(1.0%)	(1.5)	(0.7%)	(1.02)	(0.5%)	n.s.	n.s.

Net profit (loss) for the year (group and minorities)	(6.6)	(2.9%)	(6.0)	(2.8%)	(5.16)	(2.4%)	n.s.	n.s.

Minorities	(0.4)	(0.2%)	(0.4)	(0.2%)	—	0.0%	n.s.	n.s.

Group net result	(6.2)	(2.8%)	(5.6)	(2.6%)	(5.17)	(2.4%)	n.s.	n.s.

Cost of personnel includes costs for collaborations and temporary employment.

In the table above, for the purposes of greater comparability with 2021, in the column " Q4 2022 excl. D Scuola”, the reclassified

Income Statement and Statement of Financial Position show the operating and financial figures of fourth quarter 2022 excluding

D Scuola (fully consolidated at the income level as from 1 January 2022 and at the balance sheet level as from 31 December

2021).

Directors' Report on the Group’s Operations in 2022

ALTERNATIVE PERFORMANCE

MEASURES

This document, in addition to the conventional

statements and financial measures required by

IFRS, presents a number of reclassified

statements and alternative performance

measures in order to provide a better

understanding of the operating and financial

performance of the Group, the definition of

which is explained in the section “Glossary of

terms and alternative performance measures

used”.

2022 ANNUAL FINANCIAL REPORT

INCOME STATEMENT

REVENUES

Consolidated revenue for the fourth quarter of

2022 amounted to € 224.8 million (versus €

218.4 million the prior year), growing by 2.9%.

Net of the consolidation of D Scuola, revenues

would have been essentially in line.

In the Books area, revenue increased by 14.3%

or 6.2% without D Scuola, deriving in particular

from the positive performance of the Trade

publishing houses, and as a result of the new

companies acquired in 2022 (De Agostini Libri

and Edizioni Star Comics).

The Retail area grew by 6.1% on the same

quarter of the prior year, driven by the book

product, which rose by 7%.

The Media area showed revenues down 24.9%,

mainly as a result of the changes in scope in

respect of the disposals made (net of which, the

reduction would have been just 4.2%) and the

reduction in circulation revenue. Revenue from

digital advertising sales, by contrast, grew by

2% on the equivalent quarter of the prior year.


REVENUES by Business Area	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change %	Change % Excl. D Scuola
(Euro/millions)	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change %	Change % Excl. D Scuola

Books	132.9	123.5	116.3	14.3%	6.2%
Retail	63.2	63.2	59.6	6.1%	6.1%
Media	42.5	42.5	56.6	(24.9%)	(24.9%)
Corporate & Shared Services	11.9	11.9	11.3	5.0%	5.0%
Total aggregated revenue	250.5	241.2	243.8	2.7%	(1.1%)

Intercompany	(25.7)	(24.8)	(25.3)	1.2%	(2.0%)
Total consolidated revenue	224.8	216.3	218.4	2.9%	(1.0%)

Directors' Report on the Group’s Operations in 2022

EBITDA

Adjusted EBITDA in the last quarter of 2022

amounted to € 20.8 million, in line with the €

20.7 million in Q4 2021 and reflects the

favourable trend in consolidated revenue.

More specifically, the various business

segments achieved the following results:

•the Books area shows adjusted EBITDA, net

of the contribution of D Scuola, down € 4.3

million: the increase in the costs of raw

materials and the rise in tariffs for printing and

logistics services, which grew throughout the

year, have reached full expression in this

quarter.

•the Retail area recorded a strong

improvement, amounting to over € 1.6

million, thanks to revenue growth, especially

in the Book product, and the continued

development and renovation of the network

of directly-managed stores, despite higher

utility costs of approximately € 0.3 million;

•the Media area was basically steady, with the

increase seen in digital businesses offsetting

the downturn to printing;

•the Corporate & Shared Services Area

booked a negative margin of € 1.4 million

(versus 1.0 million in Q4 2021).


Adj. EBITDA by business area	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change	Change excl. D Scuola
(Euro/millions)	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change	Change excl. D Scuola

Books	10.6	8.8	13.1	(2.5)	(4.3)
Retail	5.0	5.0	3.4	1.6	1.6
Media	4.8	4.8	4.7	0.1	0.1
Corporate & Shared Services	(1.4)	(1.4)	(1.0)	(0.5)	(0.5)
Intercompany	1.9	1.9	0.5	1.4	1.4

Total ADJUSTED EBITDA	20.8	19.1	20.7	0.1	(1.7)

2022 ANNUAL FINANCIAL REPORT

EBITDA for the quarter amounted to € 16.3

million (€ 10.7 million in Q4 2021), showing an

improvement - of more than € 5 million - which

reflects lesser non-recurring negative items

attributable to restructuring costs, booked - in

particular in the Media and Corporate & Shared

Services areas - in the last quarter of 2021.

Excluding the contribution of D Scuola, EBITDA,

of € 15.4 million, increased by € 4.6 million or

more than 43% compared with 2021, due to the

favourable dynamics of the non-ordinary items,

as already described.


EBITDA by Business Area	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change	Change excl. D Scuola
(Euro/millions)	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change	Change excl. D Scuola

Books	8.3	7.4	11.7	(3.4)	(4.3)
Retail	4.4	4.4	1.9	2.5	2.5
Media	3.5	3.5	(0.3)	3.7	3.7
Corporate & Shared Services	(1.8)	(1.8)	(3.2)	1.4	1.4
Intercompany	1.9	1.9	0.5	1.4	1.4

Total EBITDA	16.3	15.4	10.7	5.5	4.6

Directors' Report on the Group’s Operations in 2022

EBIT

In the fourth quarter 2022, the Mondadori

Group EBIT closed with a negative € 5.3 million

or € 3.8 million excluding the contribution of D

Scuola. The like-for-like comparison with 2021

therefore shows an improvement of € 3.0

million, due to the non-ordinary dynamics

described previously, partly offset by greater

depreciation and amortisation for € 1.7 million,

deriving from the increased investments made

in the last 12 months.

The negative impact of the impairment booked

during the last quarter of 2022, as the result of

impairment testing and, in particular, of the

application, under the scope of this process, of

higher discounting rates, are essentially in line

with those recorded in the fourth quarter of

2021.


EBIT by Business Area	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change	Change excl. D Scuola
(Euro/millions)	Q4 2022	Q4 2022 excl. D Scuola	Q4 2021	Change	Change excl. D Scuola

Books	0.5	2.0	5.8	(5.3)	(3.8)
Retail	1.7	1.7	(1.9)	3.6	3.6
Media	(5.2)	(5.2)	(5.6)	0.4	0.4
Corporate & Shared Services	(4.2)	(4.2)	(5.6)	1.4	1.4
Intercompany	1.9	1.9	0.5	1.4	1.4

Consolidated EBIT	(5.3)	(3.8)	(6.8)	1.5	3.0

2022 ANNUAL FINANCIAL REPORT


	PERFORMANCE BY BUSINESS AREA

PERFORMANCE BY

BUSINESS AREA


(Euro/milions)	Revenues		EBITDA Adjusted		EBITDA		Depreciation and amortisation, and write-downs		EBIT
	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021

Books	576.2	465.0	118.5	92.6	114.9	90.1	(26.4)	(16.1)	88.6	74.0
Retail	189.2	173.9	9.1	5.1	8.2	3.7	(9.1)	(10.3)	(0.9)	(6.6)
Media	177.8	206.6	14.1	12.4	14.0	7.1	(13.1)	(10.1)	0.9	(2.9)
Corporate & Shared Services	41.5	40.9	(5.4)	(4.2)	(6.4)	(9.6)	(9.5)	(9.5)	(15.9)	(19.1)
Intercompany	(81.7)	(79.0)	—	(0.1)	0.1	(0.1)	—	—	0.1	(0.1)

Total	903.0	807.3	136.3	105.7	130.7	91.1	(58.0)	(45.9)	72.7	45.2

The breakdown of performance by business area reflects the system used by Management to oversee Group performance, in accordance with IFRS 8.

Directors' Report on the Group’s Operations in 2022

BOOKS

Mondadori Libri S.p.A. is the Group company

heading all of the Group's activities in the

Books Area, divided into the Trade and

Education business units.

The Trade perimeter includes:

•editorial activities relating to the publication -

both in paper and digital format (e-books and

audio-books) - of the fiction, non-fiction,

children's and miscellaneous works by the

publishing houses, which enable the Group to

hold a leadership position at national level,

with a share of 27.0% at the end of 2022:

Mondadori, Giulio Einaudi editore, Piemme,

Sperling & Kupfer, Frassinelli, Rizzoli, BUR,

Fabbri Editori, Rizzoli Lizard and Mondadori

Electa; these have been joined by De Agostini

Libri as of 1 April 2022 and, as of 1 July 2022,

Star Comics, Italy's leading comic books

publisher, specialized in the publication on

the domestic market of the major

international productions including, in

particular, Japanese manga;

•art publishing where the Group operates

under the Electa and, from 2020, Abscondita

brands. The segment's activities include

publishing of works on art, architecture,

exhibition catalogues, museum guides and

sponsor books in art publishing, as well as the

management of museum concessions and the

organization of exhibitions and cultural

events;

•the publishing house Rizzoli International

Publications, which operates on the US

market with the Rizzoli, Rizzoli New York,

Rizzoli Electa and Universe brands and with

the Rizzoli Bookstore located in New York.

The Education business unit operates in the

field of school textbooks and, to a lesser extent,

university textbooks. In school textbooks, the

Group boasts a leadership position with an

adoption share of 32.3%5 including the

activities of D Scuola which, at end 2021, joined

Mondadori Education and Rizzoli Education,

strengthening the publishing offer of textbooks,

courses, teaching tools, training courses and

multimedia content for every school level, from

primary school to middle and secondary

schools, through to university publishing with a

large catalogue of approximately 30 proprietary

and distributed brands.

Market performance

Following the remarkable growth seen in 2021,

FY 2022 has witnessed a consolidation phase

of the books market, which was basically

steady in terms of value (+0.2%) and volume

(-0.4%)6 versus 2021.

Breaking this trend down into the various

segments making up the Trade publishing

market, we can see that this stability is the

result (i) of slight growth in the Trade segment

in the strictest sense (+1.2%) (ii) of a more

significant increase in the Comics segment

(+7.5%), which even after the extraordinary

growth seen from 2019 to 2021, has still been

confirmed as the most dynamic and (iii) a sharp

decline in the Professional segment (-14.7%).

As regards the various product categories that

mark the segment, Hardcovers - which

represent the new publications for the year and

account for approximately 84% of the market -

declined slightly by 0.9%, while Paperbacks

(“catalogue titles") bucked the trend and grew

by 6.7%.

The dimension of the digital book market (e-

books and audiobooks) is estimated as around

€ 105 million (6% of the market), down 5% on

2021 due to the juxtaposing dynamics that

characterised e-books, which experienced a

decline of 8% and audiobooks, which, by

contrast, grew by 4%.

2022 ANNUAL FINANCIAL REPORT

5 Source: ESAIE, 2022 (adopted sections)

6 Source: GfK, December 2022 (Week 52)

Against this backdrop, the publishing houses of

the Mondadori Group recorded a growth in

sell-out of 2.2% during the year, the result of a

gradually improving performance during the

year: the second half, in particular, recorded a

6.7% growth in sell-out versus the market’s

approximately 1.8% growth as a whole.

Thanks to these results, Mondadori was able to

retain its domestic leadership, with its market

share growing, after 5 years, to 27% at end

2022.


TRADE MARKET SHARES

Source: GFK, December 2022 (in value); Pro-forma (includes Star Comics in 2021)

In 2022, as proof of the quality of its publishing

plan, the Group was able to place 3 titles in the

top ten bestsellers list in terms of value7, as

shown in the table below.

In July, the Mondadori Group won the 76th

edition of the Strega Prize with Spatriati by

Mario Desiati, published by Einaudi, and

placed three other titles among the winners:

from second to fourth place: respectively, “Quel

maledetto Vronskij” by Claudio Piersanti for

Rizzoli, “E poi saremo salvi” by Alessandra

Carati for Mondadori, and “Niente di vero” by

Veronica Raimo for Einaudi.

Director’s Report on the Group’s Operations in 2022

7 Source: GFK, December 2022 (ranking in terms of cover value)


#	Title	Author	Publisher
1	Fabbricante di lacrime	Doom Erin	MAGAZZINI SALANI
2	Il caso Alaska Sanders	Dicker Joël	LA NAVE DI TESEO
3	Violeta	Allende Isabel	FELTRINELLI
4	It ends with us. Siamo noi a dire basta	Hoover Colleen	SPERLING & KUPFER
5	Rancore	Carofiglio Gianrico	EINAUDI
6	La casa delle luci	Donato Carrisi	LONGANESI
7	Una vita come tante	Yanagihara Hanya	SELLERIO EDITORE PALERMO
8	Mussolini il capobanda. Perché dovremmo vergognarci del fascismo	Aldo Cazzullo	MONDADORI
9	Nel modo in cui cade la neve	Doom Erin	MAGAZZINI SALANI
10	Cambiare l’acqua ai fiori	Perrin Valérie	E/O

The School textbook (primary and secondary

schools) market in Italy is estimated as rising on

the previous year by approximately 1.0%,

coming in at a comprehensive value of

approximately € 605 million; in this context, the

Group’s publishing houses recorded, during the

two years, a ratio of sold/adopted that is

essentially stable in secondary schools.

The total number of Italian students in the

primary and secondary school cycles in 2022

dropped by approximately 1%, more

accentuated in the primary segment (-1.5%).

On a regulatory level, ceiling limits set to

spending, which establish - by Ministry decree -

the maximum annual amounts for each level of

education for the adoption of textbooks, have

not been revised and therefore remain

unchanged on 2012 (Law 221/2012).

In all, the market saw adoption changes settle

at pre-pandemic levels after two years (2020

and 2021) that suffered the impact of the health

emergency: in primary schools, the segment

with the higher percentage, the changes came

to 77%, whilst in middle and secondary schools,

it came respectively to 35% and 40%.

As shown in the table below, in the School

textbooks segment, the publishing houses of

the Mondadori Group achieved a 32.3%

market share (including the share of D Scuola),

down slightly versus the prior year when the

decline was attributable entirely to the primary

school segment marked by greater volatility

and lower profitability.

2022 ANNUAL FINANCIAL REPORT

EDUCATION MARKET SHARES

Source: AIE, 2022 (adopted first-year sections)

In the current year, the museum segment, as a

result of the easing of the restrictive measures

to contain the pandemic and the upward trend

in international tourist flows, saw a renewal of

its operations linked to the organization of

exhibitions (including management of the

related bookstores) and art publishing, albeit to

a lesser extent than in the pre-COVID-19

period.

The economic performance of the Books Area


Books	2022	2022 excl. D Scuola	2021	% chg.	Change% excl. D Scuola
(Euro/millions)	2022	2022 excl. D Scuola	2021	% chg.	Change% excl. D Scuola

Revenues	576.2	499.5	465.0	23.9%	7.4%
Adj. EBITDA	118.5	95.3	92.6	28.0%	2.9%
EBITDA	114.9	92.6	90.1	27.6%	2.8%
Consolidated EBIT	88.6	75.4	74.0	19.7%	1.9%

PPA effects	4.2	0.8		—%	—%
Consolidated EBIT ex PPA	92.8	76.2	74.0	25.4%	2.9%

Revenues

Revenue in 2022 amounted to € 576.2 million,

up by approximately 24% versus the prior year

(+7.4% excluding the contribution of D

Scuola), divided up as follows:

•+11.8% in the Trade area, as a result of the

positive performance recorded by the

publishing houses, also thanks to the

companies acquired during the year,

DeAgostini Libri and Star Comics (+9.5%) and

coupled with the significant recovery seen in

Electa's museum activities (+80%);

•+45.2% in the Education segment due to the

consolidation of D Scuola (-1.9% on a like-for-

like basis);

•+34.7% in third-party publishers distribution

activities, which benefited from the

contribution made by Libromania.

Director’s Report on the Group’s Operations in 2022


Books Revenue	2022	2022 excl. D Scuola	2021	Change %	Change %
(Euro/millions)	2022	2022 excl. D Scuola	2021	Change %	excl. D Scuola

Trade publishing houses	257.0	257.0	234.6	9.5%	9.5%
Electa (art, exhibitions and museums)	23.5	23.5	13.0	80.8%	80.8%
Rizzoli International Publications	48.8	48.8	47.1	3.6%	3.6%
Intercompany	(0.1)	(0.1)	(0.3)	(66.7%)	(66.7%)
Total TRADE	329.2	329.2	294.4	11.8%	11.8%
Total EDUCATION	237.3	160.3	163.4	45.2%	(1.9%)
Distribution and other services	9.7	10.0	7.2	34.7%	38.9%

Total consolidated revenue	576.2	499.5	465.0	23.9%	7.4%

2022 ANNUAL FINANCIAL REPORT

Trade Books Revenue

In 2022, revenue from Trade publishing

houses amounted to € 257 million (€ 234.6

million in 2021), up by 9.5% versus last year,

driven by the positive performance of all

publishing houses (+1.9% on a like-for-like

basis), particularly of the brands Einaudi and

Sperling & Kupfer thanks to the success of the

titles published during the year and by the

consolidation of De Agostini Libri (as of 1 April

2022) and Star Comics (as of 1 July 2022).

The Hardcover segment saw all the Group's

publishing houses release works that were truly

appreciated by readers. In particular:

•Mondadori: for Italian fiction, the titles

"Quattro stagioni per vivere" by M. Corona,

"L'equazione del cuore" by M. De Giovanni,

"Le mogli hanno sempre ragione" by L.

Bianchini; for foreign fiction, "Cain's Jawbone"

by Torquemada and the new titles by J.

Grisham "Sparring Partners" and "The Boys

from Biloxi". In non-fiction “Mussolini il

capobanda” by A. Cazzullo, “La grande

tempesta" by B. Vespa, "Suicidio occidentale"

by F. Rampini, "La crepa e la luce" by G.

Calabresi Milite and in the Various the titles

"Surrender" by Bono, "Dieci cose che ho

imparato" by P. Angela and "La pura vida" by

G. Gotto;

•Einaudi: the titles 'Rancore' by G. Carofiglio,

'Caminito' by M. De Giovanni, 'Il rosmarino

non capisce l'inverno' by M. Bussola, 'Niente

di vero' by V. Raimo, 'Tasmania' by P.

Giordano, 'La carrozza della santa' by Cristina

Cassar Scalia. Mention should also be made

of the impressive performance of Mario

Desiati's “Spatriati”, winner of the 2022

edition of the Strega Prize.

•Piemme: "The Dark Hours" and "Desert Star"

by M. Connelly in Foreign Fiction, "L’isola dei

battiti del cuore" by L. Imai Messina in Italian

Fiction, "Il mostro" by M. Renzi and "La pace

interiore" by C. Amirante in Non-Fiction and

"The Summer I Turned Pretty" by J. Han in

Children's Fiction. In the Children's segment,

moreover, the publisher retained its leading

position with the titles of Geronimo Stilton;

•Sperling & Kupfer: in Foreign Fiction, great

success came from "It ends with us" by C.

Hoover, ranking in the Top Ten bestsellers

and, again by the same author, highly positive

sales of "All your perfects" released in March

in an edition with revamped graphics

specifically for the publication of the new

title.Other titles worth mentioning are "The

Dream Merchant” by Sveva Casati Modignani,

“Fair Tale” by S. King and “Dreamland” by N.

Sparks;

•Rizzoli: successful Non-Fiction titles include

“Lobby e Logge” by Sallusti-Palamara, in

Italian fiction, “Un volo per Sara”, by M. de

Giovanni, “Mi prometto il mare” by R. Bertoldi,

in foreign fiction “Lessons in Chemistry” by B.

Garmus and in Miscellaneous “Riscrivi le

pagine della tua vita” by A. De Simone and A.

Sepe.

•Electa: in Miscellaneous “Benvenuti in casa

mia! Tante ricette facili e consigli semplici per

risparmiare in cucina e in casa” by Benedetta

Rossi, “La fisica che piace” by V. Schettini and

“Se ci credi puoi” by A. Baruto.

E-book and audiobooks

Revenue from the sales of e-books and

audiobooks, which accounted for

approximately 6.6% of total publishing

revenue, was up by 7.0% versus the prior year

(+4.9% like-for-like). The number of e-book

downloads fell by 5.0% versus 2021, while

audiobook catalogue listening hours grew by

27.0%(on a like-for-like basis).

•the main titles purchased in e-book format

were “Rancore" by Gianrico Carofiglio

(Einaudi), “Never” by K. Follett (Mondadori), “

La carrozza della santa” by Cristina Cassar

Scalia (Einaudi),“Niente di vero” by Veronica

Raimo (Einaudi), “ Un volo per Sara” by

Maurizio De Giovanni (Rizzoli) and “ Spatriati”

by Mario Desiati (Einaudi). Mention should be

made that new titles were published in digital

format in 2022, increasing the catalogue to

approximately 31,000 e-book titles (on a like-

for-like basis).

•The most popular audiobook titles were“The

Pillars of the Earth ” and “Never” by K. Follett.

Director’s Report on the Group’s Operations in 2022

•Electa: in FY 2022, the revenues recorded by

the business linked to the management of

Cultural Heritage came to € 23.5 million, a

significant increase on the € 13 million of the

previous year (+80.8%) due to:

–the recovery of museum activities and

those linked to concession activities, in

particular the Roman Colosseum

concession,

–the reopening of bookshops,

–the organisation of important exhibition

projects and shows,

–the growth of art publishing in all

commercial channels in which Electa

operates.

Mention should be made that the first few

months of 2021 had been badly hit by the

effects of the pandemic, in particular by the

closures of museums, bookshops and

archaeological sites ordered by the authorities.

In 2022, activities gradually resumed: starting

late spring, in fact, constant, significant growth

was recorded in tourist flows, not just from

Europe, and particularly to the cities of art

(Venice, Rome, Naples), which assured

considerable results both in the bookshops of

the Biennial and in those of the Colosseum,

which opened the new cycle of the Roman

concession. Visitors to the Colosseum in fact

grew steadily in May, up to reaching an

average of 90% in December for 2019.

In this context, Electa recorded:

•in terms of concessions of services in

museums, after having obtained the renewal

of concessions in the bookshops of the

Colosseum Park, the Venice Bienniale and

the Milan Triennial in 2021, 2022 saw an

extension of the management of the

comprehensive concession of the Colosseum

Park, which, following a tender for the award

of the ticket services, starting 2023 will be

managed no longer under a concession

regime but rather by tender with a 4-year

contract; under this scope, Electa will deal

exclusively with the management of

bookshops, following its being awarded the

related tender in 2021;

•a positive trend in bookshop sales in Venice,

thanks to the remarkable success of the

Biennale Arte, the Archaeological Parks in

Rome, especially at the Colosseum Park

(managed under concession, as explained

above);

•the opening of important exhibitions like the

one in Parma (I Farnese, the first great

exhibition to be opened after the pandemic),

Mantua (in Palazzo della Ragione, the

Fortunato Depero exhibition, organised to

coincide with the Literature Festival) and

Milan (Palazzo Reale, with the retrospective

devoted to Max Ernst, the first ever prepared

in Italy, with more than 400 works, the result

of a multi-year research project).

•Rizzoli International Publications reported

consolidated revenue of approximately € 49

million in FY 2022, increasing by 3.6% versus

2021. Specifically:

–Revenues from the publishing business, of

€ 46 million, rose by approximately 2% on

the previous year; at equal exchange

rates, this change is negative (-10%), in line

with the performance of the North

American market8 (where the publishing

house generates 62% of its revenues) due

to fewer sales of new publications and a

reduction in deliveries of catalogue titles

(especially in the e-commerce channel).

–Revenues of the retail segment,

generated by the New York Bookstore, by

contrast, recorded very positive

performance for the year, which took

concrete form in growth of 27% on the

previous year, thanks to a general post-

pandemic recovery of physical retail.

Education Books Revenue

The Mondadori Group covers the school

textbooks segment through three publishing

houses, Mondadori Education, Rizzoli

Education and D Scuola, which produce

textbooks, courses, teaching tools and

multimedia content for every school level, from

primary school to the first, middle and

secondary schools and through to university. In

addition to the traditional product range in

paper and digital format, the Companies also

include paths on transversal topics in their

offer, such as inclusion, guidance, STEM, civic

education and digital citizenship, with a view to

offering students and teachers teaching

resources and tools that can help strengthen

2022 ANNUAL FINANCIAL REPORT

8 Source: Nielsen Bookscan, figures in terms of copies.

basic skills, reduce school abandonment and

innovate teaching generally, in line with the

objectives of the Italian National Recovery and

Resilience Plan (PNRR) set for the educational

system.

FY 2022 revenues in the school textbook

business came to € 237.3 million, up 45.2% on

2021, due to the changed consolidation scope

related to the consolidation of the publishing

house D Scuola, which contributed € 77 million

to revenue for the year.

On a like-for-like basis, revenues are slightly

down (by 1.9%) on 2021, mainly due to the

downturn recorded in the distribution and sale

of third-party products by Rizzoli Education

(dedicated to foreign language teaching) and

the decline in sales of non-adoption products,

such as university texts and dictionaries, also

due to the post-pandemic reopening of

university sites that coincided with the recovery

of the phenomenon of second-hand and piracy.

In general, the Group’s publishing houses

recorded stability in secondary schools in the

ratio of sold/adopted compared with last year.

Looking at the individual legal entities, we note

the following:

•In 2022, Mondadori Education retained its

high-ranking position in the school textbooks

segment, firmly at third place for number of

sections in terms of books adopted, with a

market share substantially in line with the

prior year (approximately 12%).

The year ended with a slight decline in

revenues (1.9%) (€ 81.6 million compared with

83.2 million in 2021) due to slightly worsening

adoption results in middle schools.

Specifically looking at the individual

segments:

–in primary schools, the company recorded

a reduction in the market share, entirely

due to fewer adoptions of religious

education texts;

–in middle schools, the publishing house

reported a decline in market share; while

–in secondary schools, thanks to the

different mix of adoption changes - more

changes in high schools and fewer in

technical and professional institutes - and

the maintenance of the sales-adoption

ratio, revenue is stable, despite a slight fall

in market share.

•In 2022, Rizzoli Education confirmed its fifth

place in the school textbooks segment in

terms of number of sections adopted, with a

substantially steady 9.6% market share.

The year ends with a slight downturn equal

to 1.9%, in revenues (€ 78.7 million compared

with 80.2 million in 2021), largely due to the

adoption performance of products of the

third-party publisher distributed Oxford

University Press, which offers texts for

teaching English.

Specifically looking at the individual

segments:

–in primary schools, the publishing house

once again retained its position as one of

the leaders, despite a worse performance

by the textbooks of the third-party

publishers distributed;

–in middle schools, specifically, the upbeat

performance of proprietary products,

which more than offset the declining

results of the distributed publisher Oxford

University Press, enabled the company to

increase its market share;

–in secondary schools, the comprehensive

trend in terms of sections adopted was

essentially in line with the previous year,

thanks to the positive performance of new

titles of proprietary brands, which offset

the downturn recorded by third-party

publisher brands (in particular, Oxford

University Press).

•D Scuola, whose business mainly focusses on

secondary schools and university education,

was confirmed as the fourth most important

publisher in the Italian school textbooks

sector, with a market share steady on 2021

(10.7%) in terms of number of adoptions.

The year ended with a slight increase in

revenues of 0.7% (€ 77.0 million on the 76.4

million in 2021, not consolidated by the

Group) as a result of the better adoption

results in secondary school segments, whilst

in primary school, the company now has only

a negligible presence, with a market share of

around 2%.

Director’s Report on the Group’s Operations in 2022

In 2022, teacher training activities continued.

Free webinars were organised (for professional

refresher courses, on disciplinary matters and

for promotion) as well as on-line seminars,

attended by around 135,000 teachers and

involving authors of the publishing house and

experts in the teaching industry. With paid-for

training (tailored courses and packages of on-

line courses for schools and on-line courses for

teachers), approximately 24,000 teachers were

involved.

In all, for all three the group’s publishing

houses, sales of adoption books/courses in

exclusively digital format, although showing

slight growth, are confirmed as essentially

irrelevant.

Revenue from distribution activities and

other services

Revenue from book distribution activities and

other services on behalf of third-party

publishers amounted to € 9.7 million in 2022,

up by 35% versus the prior year (€ 7.2 million),

thanks to the contribution made by Libromania,

a company consolidated since April 2022.

2022 ANNUAL FINANCIAL REPORT

EBITDA

Adjusted EBITDA of the Books area in 2022,

including the contribution of D Scuola (€ 23.2

million), stood at € 118.5 million, up by € 26

million. Net of D Scuola, adjusted EBITDA on a

like-for-like basis would come to € 95.3 million

versus € 92.6 million in 2021, an improvement

of approximately € 3 million thanks in

particular to the positive trend of Trade

publishing houses (comprising since 1 July the

comics publisher Star Comics), the upswing in

Electa's museum and concession-related

activities, and the higher contribution of the

relief recognized to this business (€ 6.4 million

versus 3 million in 2021).

Book area profitability, which was

approximately 21% in 2022, exceeded that

recorded in 2021 (20%), as a result of the more

substantial contribution made by school

textbook publishing houses following the

acquisition and integration of D Scuola.

This performance was achieved despite the

significant impact of the increased cost of

paper purchases, which negatively impacted

the 2022 margin for approximately € 11 million,

particularly penalising the Education business.

Reported EBITDA - € 114.9 million - improved

by € 24.9 million (or € 2.5 million excluding D

Scuola), versus € 90.1 million in 2021.

FY 2022 EBIT came to € 88.6 million versus €

74 million in 2021, with an upward trend

consistent with the mentioned operating

dynamics. Overall scope EBIT, net of the effects

of the PPA deriving from the 2022 acquisitions,

came to € 92.8 million.

Director’s Report on the Group’s Operations in 2022

RETAIL

The Mondadori Group is present in Italy:

•with the most extensive network of

bookstores: a cultural oversight present in a

capillary fashion throughout national territory,

thanks to more than 500 stores branded

Mondadori in all Italian regions and provinces,

from large cities to smaller towns, in addition

to shops-in-shops and Club Mondolibri

corners.

•on-line with the e-commerce website

mondadoristore.it and the Bookclub formula.


Stores	Dec. 2022	Dec. 2021	Change

Directly-managed bookstores	41	39	2
Franchised bookstores	494	505	(11)

Total	535	544	(9)

The year 2022 saw the continued policy of

developing and maintaining the physical

network implemented in recent years.

AS regards directly-managed stores, the

renewal of the network started back in 2019

continued with:

•maintenance of existing stores through

transfer/downsizing/remodelling projects;

•the selective development of the network,

based on a format that is now consolidated in

terms of dimensions and value proposition.

There are 41 directly-managed stores, which

recorded

•a clear rise in turnover on the previous year;

•a simultaneous reduction of 23% in the

average store surface area in the four years

2019-2022.

In 2022, openings took place in Genoa (former

Corso Sardegna Market) at the beginning of

April, Campobasso (Montenero di Bisaccia -

Costa Verde) at end May, Latina (Latinafiori

Shopping Centre) in July, and Padua (Piazza

Garibaldi former Rinascente) in September.

In January 2023, in fact, the new Vimodrone

(Milan) bookstore was opened and other

projects are being finalised during the first part

of the year.

As concerns franchisees, mainly characterised

by stores near small towns, the prevalent focus

on the Bookstore format continued, with

medium-sized bookshops offering considerable

turnover.

In 2022, in the approximately 57,000 square

metres total of franchised bookstores, turnover

grew by 4.3% on last year.

Overall, the Bookstore network (directly-

managed stores and franchisees) at end

December counted over 500 Mondadori-

branded bookstores, plus shop-in-shops, Club

Mondolibri corners.

On-line, the Group is present with the e-

commerce website www.mondadoristore.it,

whilst in the eBook/audiobook world, the

partnership continues with the Rakuten Kobo

Group.

2022 ANNUAL FINANCIAL REPORT

Market performance

In 2022, the book market in Italy remained

basically steady (+0.2%9) versus 2021; in this

context, we note the additional growth of the

physical channel (+5.4%) and the simultaneous

negative performance of the on-line channel

(-7.1%), which in the last two years, had

benefited from the restrictions linked to the

COVID-19 pandemic.

In an essentially stable book market, Mondadori

Retail grew by 10.4%. Consequently,

Mondadori Retail’s market share now comes to

12.5% (+1.2% on the previous year), driven by

the outstanding performance of the physical

stores.

Performance of the Retail Area

The transformation process launched over the

past years has made for an improvement in

operating and management performance, as

shown by the 2022 economic figures for the

area, which highlight strong growth in

revenue and margins:


Retail	2022	2021	% chg.
(Euro/millions)	2022	2021	% chg.

Revenues	189.2	173.9	8.8%
Adj. EBITDA	9.1	5.1	77.3%
EBITDA	8.2	3.7	122.6%
EBIT	(0.9)	(6.6)	n.s.

Revenues

During the year, the Retail area recorded

revenue for € 189.2 million, up € 15.3 million

(+8.8%) on the previous year, with additional

growth recorded in 2021 (+20.2 million or

13.1%).

The continuous work to develop and renew the

existing stores and the focus on the core

business of books have enabled the Mondadori

Store network to consolidate its role on the

market (with a market share of 12.5%, up 1.2%

on last year), thanks to the solid growth in Book

revenue (€ +15.1 million, +11.4%), which at year

end even exceeded the pre-Covid period.

The revenue trend by channel is as follows:


Revenues	2022	2021	Change %
(Euro/millions)	2022	2021	Change %

Directly-managed bookstores	68.3	53.9	26.7%
Franchised bookstores	92.9	89.1	4.3%
Online	13.8	15.6	(11.5%)
Store	175.0	158.6	10.3%
Bookclub and other	14.1	15.3	(7.8%)

Total revenues	189.2	173.9	8.8%

Director’s Report on the Group’s Operations in 2022

Source: GFK, December 2022 (in terms of value)9

An analysis of the sales by channel reveals:

•additional growth in revenues from directly-

managed bookstores (26.7% on the previous

year) and franchisee bookstores (4.3% on the

previous year);

•after the growth of the two previous years,

2022 saw the on-line channel record a

decline in turnover in line with the negative

trend of the whole of the e-commerce market.

As far as the product categories are concerned:

•the Book, which is the Mondadori Group's

core business, was the main component of

revenues (more than 80% of the total product

turnover), up comprehensively by 11.4% on

2021, driven by the excellent performance of

physical stores;

•Extra Book turnover showed a positive trend

(+13.1% on last year) as a result of the disposal

of certain product categories (during H1 2022)

and thanks to the growth of the Impulse

sector (stationery, toys and gifts).

EBITDA

During the year, Mondadori Retail recorded

significant growth in the adjusted gross

operating profit net of non-ordinary items

(Adjusted EBITDA inc. IFRS 16), coming to € 9.1

million (+€ 4.0 million on the same figure of

2021).

The structural actions introduced in recent

years have brought a strong turnaround in the

area’s operating and financial performance, as

already seen by last year's results. This target

was achieved thanks to the deep

transformation of the area as a whole, the

ongoing renewal and development of the

network of physical stores, as well as careful

cost management and a thorough review of the

organization and processes. All this

complemented by constant work on product

innovation and the expansion of the range of

publishing products, accompanied by new

services, communication formats for clients and

partners, and ongoing training of HQ and store

staff.

Gross operating profit (EBITDA inc. IFRS 16)

came to € 8.2 million (+€ 4.5 million on the

same figure of 2021) and includes:

•restructuring costs for € 0.3 million (€ 0.9

million at 31 December 2021);

•other non-ordinary items, including store

closure costs for € 0.6 million (€ 0.5 million at

31 December 2021).

The Operating loss of € -0.9 million (including

restructuring costs, provisions made for risks

and impairment of assets) recorded, in turn, a

significant improvement (€ +5.7 million on the

previous year).

The income statement recorded a much lesser

loss than in previous years, closing with a net

result of just € 1.4 million, an improvement of

+4.1 million on the loss of € -5.5 million in 2021.

2022 ANNUAL FINANCIAL REPORT

MEDIA

Mondadori Media S.p.A. is the Group company

that encompasses all businesses linked to the

development of the brand media and digital

activities taking a multichannel approach.

Relevant market performance

The relevant markets in 2022 performed as

follows:

•the advertising market (excluding searches,

social networks, classified and OTT) declined

by an overall 2.8% versus the prior year;

individual segments performed as follows:

digital -3.2%, TV -5.2%, newspapers -6.1%,

radio +1.7% and magazines -4.8%10;

•the magazines circulation market declined by

7.4%11;

•the add-ons market fell by 13.9%12.

In 2022, the Mondadori Group, as Italy's top

multimedia publisher, continued its efforts to

engage readers and users and strengthen

communities across all media:

•in print with 15 titles and 9.3 million

readers13(which include the titles Grazia and

Icon, transferred with effect from 1 January

2023)

•on the web with 13 brands and an average

reach of 70% (monthly average of

approximately 29.7 million unique users)14;

•in social media with a fan base at 31

December 2022 of 75.8 million15 and 110

profiles.

In the magazine segment, Mondadori's market

share (in terms of circulation) stood at 21%,

slightly up versus 2021, as a result of its

outperforming the reference market (20.8% at

end of 2021)14.

In the digital area, Mondadori Media retained

its leadership in segments with high sales

value and audience figures16:

•in food with GialloZafferano which, after

recording 19.1 million users in December and

an aggregate fan base of 50.3 million

(including international profiles), is confirmed

as the most loved food media brand by the

Italians and the 4th kitchen brand with most

followers worldwide;

•wellness with MyPersonalTrainer with 13.1

million unique users and an aggregate

fanbase of 2.7 million;

•science&tech with Focus with over 3.1 million

unique users in December and a fanbase of

3.5 million;

•parenting with NostroFiglio with 2.5 million

unique users and an aggregate fanbase of 1.3

million.

In February 2022, Mondadori Media launched

The Wom, the new 100% inclusive digital brand

and social and web magazine dedicated to

young millennials and Generation Z focused on

the themes of Diversity & Inclusion: a few

months after the online launch on social

networks and the web, today The Wom already

counts a total fanbase of 5.3 million followers,

90% of whom are women, and an audience of

11 million unique users per month, positioning

the brand as a leader in the female segment.

October 2022 saw the launch of the start-up

Zenzero, the first Italian social agency to be

specialised in food, which aggregates around

the brand Giallozafferano, the most famous top

food creators.

Thereafter, in January this year, with the aim of

further developing its business in the influencer

marketing segment, Mondadori Media acquired

the talent agency Power, focussed on beauty,

fashion and wellness.

Again in January, the Mondadori Group also

purchased Webboh, further strengthening its

offer in the social world dedicated to the young

generation.

Director’s Report on the Group’s Operations in 2022

10 Source: Nielsen, December 2022

11 Internal source: Press-di, December 2022 in terms of value

12 Internal source: Press-di, December 2022 in terms of value

13 Source: Audipress III, 2022

14 Source: Comscore, December 2022, average figure

15 Source: Shareablee + internal processing

16 Source: Comscore, December 2022

Performance of the Media Area


Media	2022	2021	% chg.
(Euro/millions)	2022	2021	% chg.

Revenues	177.8	206.6	(14%)
Adj. EBITDA	14.1	12.4	14%
EBITDA	14.0	7.1	95%
EBIT	0.9	(2.9)	n.s.

In 2022, the Media area recorded revenue of

approximately € 177.8 million, dropping by

approximately 14% versus the prior year, but

increasing by approximately 2% on a like-for-

like basis (excluding the effect of the

deconsolidation of the titles sold at end 2021

and the distribution activities of Press-di, the

majority of which was sold effective 1 July

2022).

In FY 2022, the Mondadori Group completed

its rationalisation of the Print offer portfolio,

concentrating on brands with greater

multimedia development potential.

Breaking down the performance:

•digital activities, which account for more than

27% of the area's total revenue, rose sharply

in FY 2022, by approximately 9.5% (+14.6% on

a like-for-like basis);

•traditional print activities, excluding the titles

sold at end 2021 and distribution activities,

were down by approximately 4%.


Media	2022	2021 lfl	2021	Change %Like-for-like	Change %
(Euro/millions)	2022	2021 lfl	2021	Change %Like-for-like	Change %

Circulation	55.9	61.0	69.9	(8.3%)	(20.1%)
Add-on sales	22.0	22.8	23.7	(3.1%)	(6.9%)
Print Advertising	20.7	20.6	26.0	0.3%	(20.3%)
Digital Advertising	47.4	41.3	43.3	14.6%	9.5%
Total Advertising	68.1	62.0	69.3	9.8%	(1.7%)
Distribution/Other revenue	31.8	28.9	43.8	10.0%	(27.4%)

Total revenues	177.8	174.6	206.6	1.8%	(13.9%)

Specifically:

•advertising revenue - of approximately € 68

million - were up by approximately 10% on

like-for-like portfolio, thanks to the essential

stability recorded by the Print area (+0.3%)

and strong growth noted by AdKaora (as a

result of the development and monetization

of new mobile advertising formats for mobile

phones) and by Hej! (thanks to the

development of conversational performance

marketing solutions). Thanks to this growth,

digital revenue as a percentage of total

advertising revenue stands at 69.6% of the

total (62.5% in 2021).

•Circulation revenues (news-stands +

subscriptions) fell by 8.3% on a like-for-like

basis; breaking down the performance, we

note that the performance of television titles,

which account for approximately 60% of the

total, and Chi, was better than the overall

trend of circulation revenue, booking

respectively a decline of 6.3% and 2%.

•Revenue from add-on products (DVDs, CDs,

gadgets and books) sold as add-ons to

Mondadori magazines, again on a like-for-like

basis of portfolio, was down by 3.1% versus

2021, well outperforming the market, due

mainly to a decline in music products and

Home Video, only partly offset by a positive

performance in the gadgets segment.

2022 ANNUAL FINANCIAL REPORT

•Other revenue, which includes revenue from

newsstand distribution and subscriptions,

increased by 10% on a like-for-like basis

versus the prior year, the result mainly of

growth in the portfolio of third-party

publishers distributed and related services.

EBITDA

Adjusted EBITDA for the Media area came to €

14.1 million, showing growth of approximately

14% versus last year and margins improving by

2 percentage points (from 6.0% to 7.9%) mainly

due to:

•the increased profits from the FuoriSalone

2022 event;

•the booking of a tax receivable of € 1.9 million

recognized on paper consumption, which

mitigated, although not entirely neutralising,

the higher cost of the raw material (€ 2.8

million - including the volume effect);

•the continuing actions to contain operating

costs launched in prior years;

•the significant growth of the MarTech

segment with the companies AdKaora and

Hej!.

Reported EBITDA stood at € 14 million, up

versus € 7.1 million in 2021, as a result of (i)

lesser restructuring costs (ii) the release of a

provision for risks, the size of which deemed to

be in excess of the underlying contingent

liabilities and (iii) the recognition of the capital

gain from the sale of 80% of Press-di

Distribuzione Stampa e Multimedia S.r.l. on 7

July 2022.

EBIT stood at a positive € 0.9 million,

compared with a loss of € 2.9 million at 31

December 2021, thanks to the clear

improvement in the mentioned operational

dynamics and despite the recording, following

impairment testing, of the write-down of certain

titles, TV Sorrisi e Canzoni first and foremost (€

6.6 million), due mainly to the increased

discounting rate (from 7.4% to 9%) adopted in

impairment testing.

Director’s Report on the Group’s Operations in 2022

CORPORATE & SHARED SERVICES

The Corporate & Shared Service segment

includes - besides the Group's top

management organizations - the Shared

Services functions providing services to Group

companies and the different business areas.

These services are mainly associated with

activities regarding: Administration,

Management Control and Planning, Treasury

and Finance, Purchasing, IT, Human Resources,

Logistics, Legal and Corporate Affairs, and

External and Institutional Relations.

Revenues, which in FY 2022 held basically

steady on 2021, consisted mainly of the

remuneration of services provided to

subsidiaries and associates.

Adjusted EBITDA for the area came to a

negative € 5.4 million, worse than the -4.2

million of 2021, mainly due to the increase in

utility costs relating to the management of the

headquarters, amounting to approximately €

1.3 million during the year.

EBITDA, including non-ordinary items, stood at

€ -6.4 million, improving significantly versus the

-9.6 million of the previous year, thanks to the

reduction (more than € 4 million) in non-

recurring expense for the year, resulting partly

from the recognition in 2021 of costs from the

supplementary non-compete agreement (€

800,00017) awarded to the previous CEO at the

end of his term of office.

EBIT in the area amounted to €-15.9 million (€

-19.1 million in 2021), increasing by € 3.2 million

from the abovementioned dynamics.


Corporate & Shared Services	2022	2021	Change
(Euro/millions)	2022	2021	Change

Revenues	41.5	40.9	0.6
Adj. EBITDA	(5.4)	(4.2)	(1.2)
EBITDA	(6.4)	(9.6)	3.2
EBIT	(15.9)	(19.1)	3.2

2022 ANNUAL FINANCIAL REPORT

17 Non-compete clause extended within the European Union and until April 2023.

STATEMENTS OF

FINANCIAL POSITION

The Mondadori Group's Net Financial Position,

excluding IFRS 16, at 31 December 2022 shows

net debt of € 106.1 million.

IFRS 16 NFP stood at € -177.4 million, from the

€ -179.1 million at 31 December 2021, stable

despite the outlay incurred during the year for

the acquisitions policy and the payment of

dividends to shareholders.

This NFP includes an IFRS 16 component of €

-71.3 million, an improvement of approximately

€ 13 million versus end 2021, mainly due to the

stipulation of the new lease contract for the

Group’s Segrate office.


Net Financial Position	2022	2021
(Euro/millions)	2022	2021

Cash and cash equivalents	34.9	90.7
Assets (liabilities) from derivative financial instruments	10.5	(0.1)
Other financial assets (liabilities)	(22.0)	(27.3)
Loans (short and medium/long term)	(130.4)	(164.4)
Held-for-sale financial assets (liabilities)	0.9	6.3

Net Financial Position no IFRS 16	(106.1)	(94.8)
Financial payables IFRS 16	(71.3)	(84.3)
Total Net Financial Position	(177.4)	(179.1)

The overall credit lines available to the Group

at 31 December 2022 amounted to 631.3

million euro, 418.3 million euro of which

committed.

The Group’s short-term loans, amounting to €

213.0 million, € 10.0 million of which drawn

down at 31 December 2022, included overdraft

credit lines on current accounts, advances

subject to collection and "hot money" flows.

Committed lines of credit consist of the pool

loan agreement (Banco BPM, BNL, Intesa

Sanpaolo and Unicredit), amounting to an

original € 450.0 million (€ 418.3 million at 31

December 2022), stipulated in May 2021 and

maturing on 31 December 2026:


(Euro/millions)	Line of Credit	Of which: unutilized	Of which with interest rate hedge

Term Loan A	63,318	-	63,3
RCF	125,019	125,0	-
Acquisition Line C	230,020	170,0	60,0

Total	418,3	295,0	123,3

Director’s Report on the Group’s Operations in 2022

18 Maturities: 5 equal instalments of € 15.8 million, maturing on 31 December each year until 31 December 2026; the exposure is fully hedged at a

fixed rate (-0.086%)

19 Bullet loan, coming to maturity on 31 December 2026

20Final maturity on 31 December 2026, availability period until April 2023; annual repayment in equal instalments equal to 1/3 of the drawn amount of

the line as from 31 December 2024. The portion drawn down at 31 December 2022, relating to the loan for the acquisition of D Scuola, is € 60 million;

the exposure is fully hedged at a fixed rate (-0.098%).

An analysis of the Group's Cash Flow on a like-for-like basis, excluding the effects of the acquisition of

D Scuola:


(Euro/millions)	2022	2022 excl. D Scuola	2021

Initial NFP IFRS 16	(179.1)		(97.6)
Financial liabilities application of IFRS 16	(84.3)		(82.8)
initial NFP NO IFRS 16	(94.8)		(14.8)
adjusted EBITDA (NO IFRS 16)	120.9	98.2	91.0
NWC and provisions	16.8	26.1	15.6
CAPEX NO IFRS16	(41.7)	(34.4)	(22.0)
Cash flow from operations	96.0	89.9	84.5
Financial income (expense) no IFRS16	(4.1)	(4.0)	(2.4)
Tax	(21.6)	(16.4)	(13.9)
Cash flow from ordinary operations	70.2	69.5	68.2
Renovations	(8.8)	(8.8)	(6.9)
Extraordinary tax	(0.3)	(0.3)	3.4
Share capital increase/dividends non-controlling	(1.0)	(1.0)	(0.1)
Purchase/disposal	(42.6)	(42.6)	(155.4)
Other income and expenditure	(7.0)	(6.5)	10.8
Cash flow from extraordinary operations	(59.5)	(59.1)	(148.2)
Free cash flow	10.7	10.4	(80.1)
Dividends paid	(22.2)	(22.2)	0.0
Tot. cash flow	(11.5)	(11.8)	(80.1)
Net financial position excluding IFRS16	(106.1)		(94.8)
IFRS 16 effects in the period	13.1		(1.4)
Final net financial position	(177.4)		(179.1)

Total cash generation in 2022 is structured as

follows.

•Ordinary cash flow was positive for € 70.2

million, slightly up on the figure recorded in

FY 2021, due to: - on the one hand, the

improvement in income management of the

business, despite the greater outlay for the

purchase of paper, the contribution of D

Scuola and the impact of derivatives relating

to interest rate hedges;

–on the other, the higher investments

made by the Group for approximately €

19 million (in particular in the Education

and Retail areas).

This result reflects operative cash flow of € 96

million, net of tax and financial expenses

totalling € 26 million. Operating cash flow

derives:

•from the sum of income management,

positive for € 121 million,

•and the performance of net working capital

(including provisions), positive for

approximately € 17 million, mainly thanks to

the contribution made by the Retail area and

the measurement of derivatives, from which

investments incurred are deducted for € -42

million.

Cash flow from non-ordinary operations came

to €-59.5 million and included mainly cash out

for:

-acquisitions and disposals, amounting to €

43 million reflecting, in addition to the

consideration for the purchase of 50% of A.L.I.

and 51% of Star Comics, the financial debt

arising from the exercise of the put/call

agreement governing the future purchase of

the remaining 49% of the latter company;

-outlays for restructuring costs of € 8.8 million.

2022 ANNUAL FINANCIAL REPORT

Consequently, comprehensive Free Cash Flow

generated by the Group came to

approximately € 11 million at 31 December

2022, before the outlay linked to the May

payment of dividends of € 22.2 million.

Below are the investments made by the Group

in FYs 2021 and 2022, broken down by

business area.


Capex by Sector of Activity	2022	2021

Books	24.9	14.2
Retail	11.2	4.7
Media	1.0	1.2
Corporate & Shared Services	4.5	1.9

Total	41.7	22.0

Below is a summary of the Group's financial

position at 31 December 2022 versus the prior

year, both on a like-for-like basis and including

the effects of the consolidation of D Scuola.

Director’s Report on the Group’s Operations in 2022


(Euro/millions)	2022	2021	% chg.

Trade receivables	161.2	165.0	(2.3%)
Inventory	151.4	120.6	25.5%
Trade payables	252.7	223.0	13.3%
Other assets/ (liabilities)	(45.7)	(42.0)	n.s.

Net working capital from continuing operations	14.2	20.6	(31.1%)

Discontinued or discontinuing assets (liabilities)	(0.4)	(8.0)	(95.6%)

Net working capital	13.9	12.7	9.5%

Intangible assets	372.3	351.8	5.8%
Tangible assets	24.1	14.6	65.4%
Investments	29.7	18.7	58.8%

Net fixed assets with no rights of use IFRS16	426.2	385.2	10.7%

Assets from rights of use IFRS16	68.5	80.7	(15.2%)

Net fixed assets with rights of use IFRS16	494.6	465.9	6.2%

Provision for risks	41.9	47.1	(11.0%)
Post-employment benefits	28.3	32.8	(13.6%)

Provisions	70.3	79.9	(12.0%)
Net invested capital	438.2	398.7	9.9%

Share capital	68.0	68.0	—%
Reserves	139.5	107.4	29.9%
Profit (loss) for the year	52.1	44.2	17.8%

Group shareholders’ equity	259.6	219.6	18.2%

Minority shareholders’ equity	1.3	0.0	n.s.

Net equity	260.8	219.6	18.8%

Net financial position excluding IFRS16	106.1	94.8	12.0%
Net Financial Position IFRS 16	71.3	84.3	(15.5%)

Net financial position	177.4	179.1	(0.9%)
Sources	438.2	398.7	9.9%

Under the agreement for the sale of the majority of the investment in Press-Di Distribuzione Stampa Multimedia S.r.l., the sale of the business units

comprising the publishing activities of the titles Donna Moderna and CasaFacile, and the January 2023 sale of the business unit relating to the

activities of the Grazia and Icon brands, the equity values of the above assets at 31 December 2022, and for the sake of proper comparison, at 31

December 2021, were restated in accordance with IFRS 5, under “Discontinued or discontinuing operations" and under "Liabilities disposed of or

being disposed of".

2022 ANNUAL FINANCIAL REPORT

Trend of key balance sheet figures versus 31

December 2021:

•trade receivables, despite the increase in

revenue, decreased by more than 2% as a

result:

–the growth of stores owned by the Retail

area marked by immediate conversion of

revenues into receipts;

–the resumption of museum activities

managed by Electa, in the Books area,

which show the same immediate

conversion of revenue items into receipts;

–the higher advertising revenue from the

digital segment of the Media area, marked

by more favourable collection conditions

than the print segment;

–the changes in scope linked mainly to the

consolidation of Star Comics in the Books

area and the deconsolidation of Press-di

in the Media area.

Added to all that, the positive management of

receivables pursued across all business areas;

•inventories recorded a rise of 25.5% due to

the above-described change in scope, the

higher costs incurred for purchasing raw

material (paper) and printing and packaging

services, as well as the bringing forward of

production of certain Rizzoli International

Publications titles;

•trade payables increased by 13.3% due to the

higher production costs of the Books area

and greater purchasing volumes of the Retail

area;

•other assets and liabilities were basically

steady versus 31 December 2021;

•intangible assets rose by approximately € 20

million versus December 2021, due to the

acquisitions of Edizioni Star Comics and De

Agostini Libri, partly offset by the effects of

the impairment testing and depreciation and

amortisation;

•tangible assets increased by approximately €

10 million, consisting mainly of expenditure

made in the opening of new stores in the

Retail area;

•assets for rights of use decreased by

approximately € 22 million, due mainly to the

renegotiation of the lease contract for the

Segrate HQ;

•the value of equity investments rose by

approximately € 11 million, mainly due to the

acquisition of A.L.I. Agenzia Libraria

International, partly offset by the sale of

Monradio and the effects of the impairment of

Attica;

•provisions (provisions for risks and post-

employment benefits) also declined by

approximately € 10 million on 31 December

2021, mainly linked to cash outflows relative

to restructuring costs provisioned the

previous year, and the effects deriving from

the increase in the rates used to discount

payables due to staff (as better detailed in the

Note).

Director’s Report on the Group’s Operations in 2022

PERSONNEL

HEADCOUNT

Group employees with a fixed-term or

permanent labour contract amounted to 1,900

units, up by 5% versus 1,810 units at 31

December 2021 (+90 units), due primarily to the

inclusion of D Scuola staff (totaling 125 units).

Neutralizing the effect of all scope changes -

namely, the acquisitions of D Scuola, De

Agostini Libri and Star Comics, and the

disposals of titles and assets in the Media area -

the Group workforce would drop by

approximately 1%, thanks to the continued

efforts to increase the efficiency of individual

business areas and functions.

Employees at 31 December 2022:


Headcount by Business Area	31 Dec. 2022	31 Dec. 2022 escl. D Scuola	31 Dec. 2021	Change %	Change % Excl. D Scuola

Books	842	721	644	30.7%	12.0%
Retail	308	308	321	(4.0%)	(4.0%)
Media	454	454	541	(16.1%)	(16.1%)
Corporate & Shared Services	296	292	304	(2.6%)	(3.9%)

Total	1,900	1,775	1,810	5.0%	(1.9%)

In the Books area, the headcount, net of the

employees who joined the Group following the

acquisition of D Scuola, would be up 12%; net of

changes in scope relative to De Agostini Libri

and Star Comics too, growth would be 5.3%

versus the prior year, due mainly to the

reopening of Electa Bookshops at exhibitions

and museum sites.

The decrease in the Retail area reflects the

actions for achieving greater efficiencies both

in the central units and in the organizational

structure of the directly-managed stores

network.

The trend recorded by the Media Area (16.1%)

closed at -2.6% like-for-like, therefore excluding

the changes in scope that took place during the

two years under review (net of the workforce of

the titles disposed of at end 2021 and of the

company Press-di, deconsolidated as from 1

July 2022).

The Corporate & Shared Services area

recorded a decrease in units of approximately

4%, net of the addition of certain staff functions

from the integration of D Scuola.

2022 ANNUAL FINANCIAL REPORT

Cost of personnel21 in 2022 came to € 142.3

million (or € 133.5 million net of the

consolidation of D Scuola), versus 134.9 million

in 2021: the like-for-like comparison, having

neutralised all scope changes, shows a slight

rising trend (approximately 2%) versus the prior

year, despite the positive effects of the

reduction in the average workforce, due to the

significant but temporary savings that had

greatly benefited 2021, arising partly from the

use of social shock absorbers and financed

training: net of these non-recurring savings, the

cost of labour would have been essentially

stable with respect to the previous year.

The percentage of this cost on consolidated

revenue in 2022 was reduced by

approximately 1 point versus the prior year

(from 16.7 % to 15.8 % in 2022).


€ millions	FY 2022	FY 2022 excl. D Scuola	FY 2021	Change %	Change % Excl. D Scuola
Cost of enlarged personnel (before restructuring)	142.3	133.5	134.9	5.4%	(1.1%)

Director’s Report on the Group’s Operations in 2022

21 Cost of enlarged personnel includes costs for collaborations and temporary employment

PERFORMANCE OF

ARNOLDO MONDADORI

EDITORE S.P.A.


(Euro/millions)	2022		2021		Change %

Revenues	41.8		41.1		1.7%
Industrial product cost	0.1	0.3%	0.1	0.2%	33.5%
Variable product costs	0.1	0.2%	0.1	0.2%	4.7%
Other variable costs	0.2	0.4%	0.3	0.7%	n.s.
Structural costs	25.6	61.3%	25.0	60.9%	2.2%
Extended labour cost	21.4	51.2%	21.0	51.2%	1.7%
Other expense (income)	0.1	0.1%	(0.1)	(0.2%)	n.s.

Adjusted EBITDA	(5.7)	(13.5)%	(5.4)	(13.1%)	n.s.

Renovations	0.5	1.2%	4.9	11.9%	n.s.
Extraordinary expense (income)	0.5	1.2%	1.1	2.6%	n.s.

EBITDA	(6.7)	(16.0)%	(11.4)	(27.7%)	n.s.

Amortisation and depreciation	3.9	9.4%	3.9	9.4%	1.3%
Impairment and write-downs	—	—%	—	—%	n.s.
Amortization and depreciation IFRS 16	5.6	13.3%	5.6	13.6%	n.s.

EBIT	(16.2)	(38.7)%	(20.8)	(50.7%)	n.s.

Financial expense (income)	3.3	7.9%	1.8	4.3%	87.5%
Financial expense IFRS16	(0.6)	(1.3)%	1.3	3.1%	n.s.
Financial expense (income) from securities valuation	—	—%	0.4	1.1%	n.s.
Expense (income) from investments	(67.5)	(161.6)%	(65.3)	(159.0%)	n.s.

EBT	48.6	116.4%	41.0	99.8%	18.5%

Tax expense (income)	(3.5)	(8.3)%	(3.2)	(7.8%)	n.s.

Net profit (loss) for the year	52.1	124.7%	44.2	107.6%	17.8%

The Parent Company's income statement at 31

December 2022 shows the same profit as in

the consolidated financial statements of € 52.1

million (€ 44.2 million in 2021), due to the fact

that the Company has chosen to use the equity

method to measure its investments in the

separate financial statements.

Revenues, which consist of central structural

costs charged back to the subsidiaries, of €

41.8 million, are essentially stable with respect

to the previous year.

2022 adjusted EBITDA worsened slightly by

approximately € -0.3 million from € (5.4) to (5.7)

million of last year, mainly due to the higher

costs for utilities relating to the management of

the Segrate office.

FY 2022 showed reported EBITDA of € -6.7

million, a clear improvement on FY 2021 (-11.4

million), having benefited from lesser non-

ordinary items for approximately € 5 million,

mainly relating to lesser provisions made for

restructuring costs.

2022 ANNUAL FINANCIAL REPORT

Amortization and depreciation in 2022,

amounting to € 3.9 million, was basically steady

versus 2021.

FY 2022 included net financial expense

totalling € 3.3 million, increasing both due to

the rise in average debt for FY 2022 and the

booking of a non-recurring item of income in FY

2021 linked to the renegotiation of the credit

facilities.

Financial expense from the application of IFRS

16 was significantly better than in 2021, thanks

to the recognition of non-recurring income of

approximately € 1.4 million from the early

termination of the old lease contract for the

Segrate HQ (the new contract was signed in

July 2022).

Financial expense arising from the valuation of

securities during FY 2021, refers to the effects

of the sale of the investment in Reworld Media,

fully completed in February 2021, which

resulted in the recognition of a loss of € 0.4

million.

The positive contribution from the equity

measurement of investments amounted to €

67.5 million, up versus € 2.2 million in the prior

year, due primarily to the following factors:

•the greater write-back of the subsidiary

Mondadori Libri S.p.A., also following the

changes made to scope, despite the non-

recurring tax income from the tax realignment

of trademarks and goodwill from which FY

2021 had benefited;

•the lesser write-down of Mondadori Retail

S.p.A..

The measurement at equity was, instead,

affected negatively by:

•a lower write-back of Mondadori Media S.p.A.

versus 2021;

•the additional write-downs of the associate

S.E.E. (publisher of Il Giornale) and Attica.

The Company’s net profit was therefore € 52.1

million (compared with € 44.2 million in 2021).

Director’s Report on the Group’s Operations in 2022

INTERNAL CONTROL AND

RISK MANAGEMENT

SYSTEM

The Mondadori Group’s internal control and

risk management system refers to the set of

procedures, organizational structures and

associated activities designed to ensure proper

management of the company in line with its

pre-established objectives, through adequate

identification, measurement and monitoring of

the main risks it faces.

The guidelines and overarching themes are

based on the principles set out in Enterprise

Risk Management (ERM), an international

standard drawn up by the Committee of

Sponsoring Organizations of the Treadway

Commission (COSO Report).

Since 2008, when defining these guidelines,

the Mondadori Group has followed a process

designed to identify, measure and manage the

main risks and uncertainties it faces as it

pursues its business objectives.

To this end, the Risk Management Department

was established, which not only preserves the

“defensive” approach in respect of the risks to

protect the company’s value, is also a factor

that enables change and the exploitation of

business opportunities proposed.

The significance of the risks – which are

classified into categories and sub-categories –

is determined based on measures of their

likelihood of occurrence and their impact not

only in financial terms, but also in terms of

market share, competitive advantage and

reputation.

Through a self-assessment process, which

involves the use of interviews and

questionnaires, the company management

team (i.e. the risk owners) identifies the risks

relating to its scope of competence and

assesses their effects on the potential

achievement of company objectives.

The assessment is carried out both at the level

of inherent risk, i.e. in the absence of mitigation

measures, and residual risk, following actions

taken to reduce the likelihood of the

occurrence of the risk event and/or to contain

its possible negative effects.

A first macro classification of risks involves a

distinction between internal and external,

where:

•external risks are those deriving from the

socio-economic scenario, i.e. linked to

national and international instability/conflict,

social and employment aspects and

environmental aspects;

•internal risks are those linked to the revision

of corporate processes, information flows,

performance objectives and the

modernisation of IT systems.

The classification is necessary to establish a

common language between the business units,

working groups, etc. and to aggregate all risk

factors at a corporate level.

The results are collated and processed by the

Risk Management function and reported

specifically to the Control, Risk and

Sustainability Committee, the Board of

Statutory Auditors and the Board of Directors.

The status of the risks is reviewed and updated

at least annually

The actual existence and effectiveness of

mitigation actions, as reported by the

management during assessment, is then

verified by the Internal Audit Department,

which uses the risk mapping to prepare an

audit plan. In addition, to bring the residual risk

back below an acceptable risk threshold, both

in terms of probability of onset and potential

impact (the “risk appetite”), the Risk

Management department works in conjunction

with company managers to plan and implement

risk response actions, mapping the additional

mitigating actions it prepares.

2022 ANNUAL FINANCIAL REPORT

Risk Assessment 2022-2023

The main risks, outlined in the Risk Assessment

2022-2023 and the main mitigation actions

taken, are described below.

RISKS ASSOCIATED WITH THE

EXTERNAL CONTEXT

The current market context would appear to be

increasingly uncertain and complex,

characterised by the effects of the conflict still

ongoing, coupled with the evolution of the

COVID-19 pandemic.

New risks have emerged with probability of

onset and severity of consequences far higher

than those of a few years ago: consequently,

some risks, which did not previously call for

specific intervention and/or specific prevention,

must today be addressed with adequate,

suitable interventions.

The most significant are those linked to the

external context, almost exclusively relating to

the latest international events and related

severe repercussions on the European

economy.

The year 2022 in particular was marked by

significant and unexpected increases in

commodity and energy prices, a huge hike in

the cost of transporting goods, and problems

regarding logistics.

Director’s Report on the Group’s Operations in 2022


Main risks	Mitigation measures
Supply Chain: increased costs and difficulty in procuring raw materials coupled with the increased cost of utilities.	•Management of supplier relations to guarantee the ongoing supply of goods. •Scouting even outside the EU. •Careful planning of purchases (paper) and optimisation of print runs. •Focus on sustainability topics linked to distribution chain management.
Logistics service (costs/processes)	•Constant supervision of commercial contract management. •Careful monitoring of external suppliers. •Continued definition and analysis of reference monthly KPIs.
Performance of the relevant business (Trade - Education - Retail)	Trade •More "Up to date" marketing policies to intercept new readers •Exploit the advantages offered by a multichannel approach, intended as the simultaneous use of social channels, e-commerce and the more traditional bookstore channel, in order to fully understand and satisfy readers’ demands and requests. Retail •Ever greater loyalty of existing customers. •Promotion of events in the p.o.s. •Greater focus on products like comics, manga and fantasy. •Development of the directly-managed network and remodelling of the existing networks on more attractive and efficient formats. •Development of the e-commerce channel. Education •Focus of publishing on the school cycles characterised by a more favourable ratio of adopted and sold texts.
Performance of the relevant business (Electa Beni Culturali)	•Development of activities in order to increase business revenues linked to exhibitions, bookshops and publishing. •Continued independent merchandising development.

The increased cost of energy has increased the

risk for production segments linked to the

magazine business too, revealing difficulties in

significantly reducing variable costs of

publishing production without affecting

product quality. Worsening this, the dispersion

and structural inefficiency of the traditional

distribution channel (newsstands) generate

costs of production, distribution and returns

management that risk no longer being

economically sustainable in the medium-term

and not in line with the Group’s ESG

sustainability goals.

We are also seeing a physiological reduction in

spending by advertising investors, thereby

impacting the average price and profitability of

the traditional product.

2022 ANNUAL FINANCIAL REPORT


Main risks	Mitigation measures
Performance of the paper relevant business (Media)	•Continuous innovation of brands to be proposed to advertising concession holders. •Special initiatives in publishing partnerships with advertising investors. •Start-up of new brands for new advertising targets (Generation Z project). •Computerisation of the distribution chain.

With reference to outsourcing agreements

related to printing services, risks are to be

linked both to the occurrence of quality

problems and to possible delays in supplies.


Main risks	Mitigation measures
Outsourcing contract with the print services supplier	•Diversification of risk, expanding the number of suppliers involved. •Scouting on behalf of all BUs with suppliers both from the EU and China. •Define the economic importance in the event of non- conformities in terms of time and quality.

Under the scope of the topics closely linked to

social issues and human rights, careful

attention continues to be paid to internal

communication and training of Group

employees and management with the aim of

sensitising and raising awareness of topics of

diversity and inclusion through meetings,

seminars and learning and discussion paths.

Director’s Report on the Group’s Operations in 2022

RISKS ASSOCIATED WITH THE INTERNAL CONTEXT: BUSINESS RISKS

The technological evolution has impacted all

phases of the publishing processes: from the

design of the work through to reading, from

production to distribution and sale.

It is therefore becoming increasingly necessary

to rethink how work is organised, to assure a

response to the renewed needs at the same

speed with which the technology itself evolves.


Main risks	Mitigation measures
Technological discontinuity (e-commerce/streaming platforms)	•Implementation of forecasting systems that can identify anomalies in demand trends. •Rethinking the web strategy in order to increase the loyalty of consumers not opting to use e-commerce services.
Management, redefinition and implementation of new technological systems and IT structure.	•Investing in advanced systems able to support business evolutions. •Guaranteeing data security. •Use of new virtual payment systems.
Competences (Human resources) for the development of the multimedia business and IT	•Staff development policies with a particular focus on the key figures requested. •Training interventions, intended for the sales network, focussed on the multimedia contents of school textbook production.

2022 ANNUAL FINANCIAL REPORT

RISKS ASSOCIATED WITH SUSTAINABILITY

The Mondadori Group continues its work on

ESG topics, also through internal and external

stakeholder engagement activities.

The latter were asked to identify, in line with

their own expectations and needs, the

sustainability topics they consider more or less

relevant. Their involvement has made it

possible to more objectively identify the topics

of greatest relevance and to more clearly and

properly understand the different perspectives

and information needs that mark the

stakeholders involved.

The various ESG topics analysed include, in the

environment area, the assessment not only of

climate impacts on the company but also the

effects the company has on climate and

sustainability, considering, for example,

greenhouse gas emissions linked mainly to

energy consumption used in the production

cycle of paper products and transport in

logistics/distribution.

The Mondadori Group internal control and risk

management system, in line with the

requirements set out in the Corporate

Governance Code for Listed Companies,

oversees, in addition to the Risk Management

Department, the following areas:

•Internal Audit, which performs audits in the

following areas: operations (company

processes), compliance (respect for

procedures), compliance with Legislative

Decree 231/2001 (health and safety), IT,

compliance with Law 262/2005 (financial

audit), and fraud. The planning of the audits is

approved by the Board of Directors, subject

to the positive opinion of the Control, Risk

and Sustainability Committee.

•Compliance 231: see updated Organizational,

Management and Control Models pursuant to

Legislative Decree no. 231/2001.

•Compliance: with regard to the drafting,

updating and maintaining the Group’s

procedures and operating policies.

•Whistleblowing as it is responsible for the

contents and management of the policy, it

verifies and applies the relevant standards

and best practices; it measures and assesses

any reports received.

Director’s Report on the Group’s Operations in 2022

SIGNIFICANT EVENTS IN THE YEAR

On 25 February 2022, the Mondadori Group

announced that it had received notice from the

Antitrust Authority of the authorization to

acquire from De Agostini Editore S.p.A. a 50%

stake in the share capital of DeA Planeta Libri

S.r.l..

On 7 March 2022, the Mondadori Group

announced that it had received notice from the

Antitrust Authority of the authorization to

acquire a 50% stake in A.L.I. S.r.l. - Agenzia

Libraria International, specialized in the

distribution of books.

On 1 April 2022, the Mondadori Group, through

its subsidiary Mondadori Libri S.p.A., in

execution of the agreement signed and

disclosed to the market last 22 November

2021, completed the acquisition from De

Agostini Editore, of a 50% stake in the share

capital of De Agostini Libri S.r.l., formerly DeA

Planeta Libri, specialized in trade books with

focus on the children's and non-fiction

segments.

The scope of the deal includes Libromania S.r.l.,

wholly-owned by De Agostini Libri and active in

the promotion of third-party publishers: the

agreements defined include put&call options,

exercised during the second half of 2022.

The transaction, which creates a partnership

with a time-honoured publishing house

boasting a strong heritage and know-how, is in

line with the repeatedly announced strategy of

increasing the focus on the core business of

books, pursued also through a process of

vertical integration in the books market.

In 2021, De Agostini Libri reported consolidated

revenue of € 13.9 million and EBITDA of € 0.2

million.

As a result of the existing corporate

governance structure, the Mondadori Group

has fully consolidated the investment.

On 11 May 2022, the Mondadori Group,

through its subsidiary Mondadori Libri S.p.A.,

completed the acquisition of 50% of A.L.I. S.r.l. -

Agenzia Libraria International, operating in the

distribution of books and boasting a client

portfolio of over 80 publishers. The transaction

took place in execution of the agreement

signed and disclosed to the market last 11

November 2021.

Thanks to this acquisition, the Mondadori

Group takes a further step along the path of

increasing focus on the books market, through

a process of vertical integration that allows the

Group to strengthen its position in the

promotion and distribution of third-party

publishers, with a view to continually improving

the service level and expanding the customer

portfolio.

As already disclosed, the scope of the

transaction includes a number of subsidiaries

operating in the publishing field.

The acquisition price, paid in cash, is € 10.8

million.

The 50% stake in A.L.I. was consolidated at

equity effective as from 1 May 2022.

The final agreements envisaged the acquisition

by the Mondadori Group of a further 25% stake

in A.L.I., effective as from 28 February 2023, at

a price set based on average EBITDA

2021-2022.

The deal also governs the subscription of

put&call options, which give Mondadori the

right to acquire the remaining 25% of A.L.I. by

30 July 2025 at a price to be set based on

average EBITDA 2023-2024.

On 6 June 2022, the Mondadori Group signed

an agreement on the acquisition of a 51% stake

in Edizioni Star Comics S.r.l., Italy's leading

comic books publisher, specialized in the

publication on the domestic market of the

major international productions including, in

particular, Japanese manga.

On 30 June 2022, the Mondadori Group,

through its subsidiary Mondadori Libri S.p.A.,

then completed the acquisition of 51% of

Edizioni Star Comics S.r.l., effective 1 July

2022, the date from which Mondadori fully

consolidated the company.

The price for the acquisition of 51% of the share

capital of Edizioni Star Comics - paid fully in

cash - is € 14.28 million, defined on the basis of

an Enterprise Value (for 100% of the company)

2022 ANNUAL FINANCIAL REPORT

of € 28 million and an estimated net financial

position at closing of zero.

In 2021, Edizioni Star Comics recorded strong

growth in results versus the prior year: revenue

of € 21.6 million, EBITDA of € 7.2 million, net

profit of € 5.1 million, and a positive net

financial position (cash) of € 4.3 million.

The scope of the transaction also includes the

acquisition, finalised in January 2023, of 100%

of Grafiche Bovini S.r.l., a company controlled

by the same family of founders, specialized in

printing activities exclusively of products

published by Edizioni Star Comics.

The price was adjusted based on the final net

financial position at 30 June 2022.

The contract also envisages the following:

•the underwriting of call option contracts,

which give the Mondadori Group the right to

acquire the remaining 49% stake in Edizioni

Star Comics, exercisable in two equal

tranches starting from the approval of the

2024 and 2027 financial statements,

respectively, at a price to be set on the basis

of the average EBITDA of the relevant

previous three years. Should Mondadori fail to

exercise the call options, the agreements

govern put options in favour of the sellers

exercisable under the same price conditions.

•Simone Bovini and Claudia Bovini - who

founded and have so far successfully

managed Edizioni Star Comics, bringing it to

its leading role in the Italian comic books

market - will retain management

responsibilities and continue to serve as

managing directors of the company.

The activities of Edizioni Star Comics can find

further opportunities for growth within the

Mondadori Group, thanks to the synergies

generated by the deal, including, in particular,

access to the most extensive network of

bookstores in Italy, where Mondadori Retail is

developing spaces specifically dedicated to the

comics product.

On 7 July 2022, the Mondadori Group

completed the disposal to Artoni Group S.p.A.

and SRH S.r.l. - two local distributors of daily

newspapers and magazines - of 51% of the

share capital of Press-di Distribuzione Stampa e

Multimedia S.r.l.; the company is wholly owned

by Mondadori Media S.p.A. and is active in the

national distribution of newspapers and

magazines for the Mondadori Group and for

approximately 90 third-party publishers.

The transaction, which did not envisage

changes in the contractual terms and

conditions already applied to distribution

activities, is intended to increase efficiency and

achieve synergies through a vertical integration

process in the sector by involving specialized

players; additionally, Righel Anglois will

continue to hold his position as CEO.

The disposal of 51% of Press-di, which

contributed approximately € 29 million to the

Mondadori Group's consolidated revenue in

2021, envisaged a consideration of € 1.5

million; the transaction produced no material

operating, financial or business effects and no

impact on the Group’s guidance for 2022 as

disclosed to the market. Thereafter, in

December 2022, as per contractual

agreements, an additional 29% was sold.

On 20 October 2022, the subsidiary

Mondadori Media S.p.A. was granted by

Reworld Media S.A. the option to sell to it the

business unit related to the Grazia and Icon

brands through a put option.

The scope of the option included the print and

digital publishing activities of the two titles, as

well as the relating international network that

ensures the brands' overall presence in over 20

countries with licensed publications.

The Mondadori Group therefore, pursuant to

the provisions of law, initiated the consultation

procedure with the trade unions, following

which the option became exercisable.

On 22 November 2022, the Mondadori Group,

through the subsidiary Mondadori Media S.p.A.

and after having completed the trade union

procedure, exercised its option of sale and

consequently signed the contract of sale with

Reworld Media S.A., for the paper and digital

publishing business of the titles Grazia and

Icon, as well as the related international

network.

The consideration for the transaction is € 8.5

million, including € 2 million as earn-out

conditional on the achievement of certain

financial results in 2023 by the operations

disposed of. The price was defined on the basis

of an Enterprise Value of € 11 million (including

earn-out), net of the difference between the

Director’s Report on the Group’s Operations in 2022

average net working capital over the last 12

months and the net working capital at the

closing date.

In 2021, these operations generated revenue of

approximately € 18 million.

Completion of the transaction was also subject

to completion of the checks by the Offices of

the Presidency of the Council of Ministers

referred to in Law Decree 21/2012.

On 15 December 2022, Mondadori Group

received notification from the Offices of the

Presidency of the Council of Ministers of the

resolution not to exercise the special powers

under Law Decree 21/2012 regarding the

disposal to Reworld Media S.A. of the

operations under the Grazia and Icon brands.

The ruling triggered the fulfilment of the

suspensive condition attached to the sale

agreement.

2022 ANNUAL FINANCIAL REPORT

SIGNIFICANT EVENTS

AFTER YEAR END

On 10 January 2023, the Mondadori Group,

through the subsidiary Mondadori Media S.p.A.,

executed the contract of sale to Reworld Media

S.A. of the paper and digital publishing

business of the titles Grazia and Icon, as well as

the related international licences network.

The execution of the transaction took place

with the transfer of the business unit heading

the operations disposed of to a newly-

incorporated company and the concurrent

disposal to Reworld Media of 100% of the share

capital of the transferee.

On 13 January 2023, the Mondadori Group

finalised, through its subsidiary Mondadori Libri

S.p.A., the acquisition of a further 25% stake in

A.L.I. S.r.l. - Agenzia Libraria International, which

operates in the distribution of books.

The transaction - as a result of which the

Mondadori Group increased its stake in A.L.I. to

75%, which is therefore subject to line-by-line

consolidation as from January 2023 - took

place in execution of the agreements defined

and disclosed on 11 May 2022 upon acquisition

of an initial 50% stake, effective earlier than the

date originally scheduled for 28 February 2023.

The provisional price, paid entirely in cash, was

approximately € 9.5 million and was

determined, as already disclosed to the market,

on the basis of an average 2021-2022 EBITDA

and the positive net financial position (cash) of

the scope covered by the transaction, which at

31 December 2022 amounted to € 17.8 million

(preliminary figure).

Additionally, the defined agreements gave the

Mondadori Group the right to acquire the

remaining 25% in A.L.I., at a price to be

determined on the basis of an average

2023-2024 EBITDA, through put&call options

exercisable by 30 July 2025.

SHARE BUYBACK

At 31 December 2022, Arnoldo Mondadori

Editore S.p.A. held no. 1,147,991 treasury shares

equal to 0.44% of the share capital, of which

no. 410,000 purchased in the current year in

execution of the purchase programme to

service the 2022-2024, 2021-2023, and

2020-2022 Performance Share Plans, the start

of which was approved by the Board of

Directors on 12 May 2022 (and concluded on 16

June 2022).

Director’s Report on the Group’s Operations in 2022

OTHER INFORMATION

In the reporting period, Arnoldo Mondadori

Editore S.p.A. did not carry out any

development activities. At closure or during the

period, it did not hold any shares in parent

companies, not even through trusts or trustees.

RELATED PARTY TRANSACTIONS

In compliance with the provisions set out in

Article 5, paragraph 8, and Article 13, paragraph

3, of the “Regulation in the matter of

transactions with related parties” issued by

CONSOB through Resolution 17221 of 12 March

2010 and subsequent amendments (the

“CONSOB Regulation”), the following is

reported relating to the period of reference:

•no transactions of greater significance were

concluded;

•no changes or developments relating to the

transactions with related parties illustrated in

the most recent Annual Report are reported

that had a significant impact on the

Company’s equity or performance in the year

of reference.

Transactions with related parties were

regulated under normal market conditions:

those concluded with Mondadori Group

companies are intercompany current account

trade and financial transactions, managed by

Arnoldo Mondadori Editore S.p.A., to which the

various subsidiaries companies contributed

based on their relevant debt and credit

positions.

For further details, reference should be made

to the Explanatory Notes to the Financial

Statements of Arnoldo Mondadori Editore

S.p.A. and to the Group’s Consolidated

Financial Statements.

TAX CONSOLIDATION

In relation to the tax consolidation regime

pursuant to Article 117 et seq. of Italian

Presidential Decree 917/1986, Arnoldo

Mondadori Editore S.p.A. renewed the option in

2022 also for its subsidiaries (Mondadori

Group) to adhere to the tax consolidation

regime with Fininvest S.p.A. as consolidating

company for the 2022-2024 three-year period.

The consolidation agreement contains a

protection clause according to which Arnoldo

Mondadori Editore S.p.A. and its subsidiaries

adhering to tax consolidation shall not be

required to pay more income tax than the

Group would have paid if Arnoldo Mondadori

Editore S.p.A. and its subsidiaries had created

its own tax consolidation agreement. Therefore,

this protection clause is aimed at only

accounting the tax amount that would have

been paid by the subsidiaries excluded from

the fiscal unit belonging to Fininvest S.p.A. as a

result of the application of the so-called

"demultiplier".

The agreement sets the priority for the

Mondadori Group to offset current tax

receivables against payables (i.e. referred to

the same year in which tax payment is due)

transferred by the adhering companies and, in

the case of residual taxable income, to

subsequently use prior-year tax losses within

the limits set by current legislation. Pursuant to

the currently applicable regulations on the

matter, the agreement allows the transfer,

within the consolidation scope, of tax benefits

enjoyed by the adhering companies, which are

transferred or made available to the fiscal unit

against recognition of a compensation (paid at

a rate corresponding to the ordinary IRES tax

value) by the companies benefiting from it.

Any tax receivables or payables resulting from

adherence to such tax consolidation agreement

are posted as receivables or payables to

holding companies, with the latter acting as

"clearing house".

TAX TRANSPARENCY

With regard to the entry into force of Article 115

of Presidential Decree 917/1986 for the

2022-2024 three-year period, the “tax

transparency" option was exercised by Direct

Channel S.p.A. and Publitalia '80 S.p.A., as

participating companies, and Mediamond

S.p.A., as investee.

After exercising this option, Mediamond S.p.A.'s

taxable income and tax losses are included pro-

rata, because of the investment held, in the

taxable income of Direct Channel S.p.A.

(formerly Mondadori Pubblicità S.p.A.) and

Publitalia '80 S.p.A..

2022 ANNUAL FINANCIAL REPORT

DIRECTION AND COORDINATION

ACTIVITIES (ARTICLE 2497 ET SEQ.

OF THE ITALIAN CIVIL CODE)

Fininvest S.p.A., pur detenendo una While

Fininvest S.p.A. holds a controlling stake

pursuant to Article 2359 of the Italian Civil

Code, it does not exert any direction and

coordination activity as defined in Article 2497

bis and ensuing articles of the Italian Civil Code

on Arnoldo Mondadori Editore S.p.A.; it

manages the investment held in Arnoldo

Mondadori Editore S.p.A. merely from a

financial standpoint.

With regard to the companies controlled by

Arnoldo Mondadori Editore S.p.A., the Board of

Directors has verified, with reference to the

requirements of law and taking into account

that the Board of Directors determines,

generally speaking, the strategic and

organizational policies relating also to

subsidiaries, the exercise of the direction and

coordination activities under Article 2497 et

seq. of the Italian Civil Code over the following

subsidiaries pursuant to Article 2359 of the

Italian Civil Code:

•D Scuola S.p.A.

•Giulio Einaudi Editore S.p.A.

•Mondadori Retail S.p.A.

•Mondadori Education S.p.A.

•Electa S.p.A.

•Mondadori Media S.p.A.

•Mondadori Libri S.p.A.

•Direct Channel S.p.A.

•Mondadori Scienza S.p.A.

•AdKaora S.r.l.

•Hej! S.r.l.

•Rizzoli Education S.p.A.

•Mondadori Scuola S.p.A.

•Libromania S.r.l.

•Zenzero S.r.l.

The abovementioned companies consequently

fulfilled their respective disclosure obligations

pursuant to Article 2497 bis of the Italian Civil

Code.

PROCESSING ACTIVITIES

PURSUANT TO ARTICLE 30 OF

REGULATION (EU) 2016/679

Arnoldo Mondadori Editore S.p.A. plays an

active role in ensuring compliance of the

Mondadori Group with the privacy regulations

envisaged in Regulation (EU) 2016/679 (GDPR),

and in applicable legislation. Specifically,

Arnoldo Mondadori Editore S.p.A. constantly

updates, pursuant to Article 30 of the above

Regulations, a register of the personal data

processing activities carried out as data

controller or data processor.

Arnoldo Mondadori Editore S.p.A., pursuant to

Article 37 of the Regulations, has a Data

Protection Officer (DPO) in place; the Officer

sees to regularly updating its privacy

documentation and security measures, based

on the principles of privacy by design and

privacy by default.

TRANSACTIONS RELATING TO

TREASURY SHARES

Renewal of the authorization to

purchase and dispose of treasury

On 28 April 2022 and in consideration of the

expiry of the previous shareholders’ meeting

authorisation of 27 April 2021 and with a view

to continuing to assure the Board of Directors

the faculty to take advantage of any investment

or operating opportunities on treasury shares,

the Shareholders’ Meeting resolved, in

accordance with Art. 2357 of the Italian Civil

Code, and with a duration established as until

approval of the financial statements at 31

December 2022, to authorise the purchase of

treasury shares. The Shareholders’ Meeting

also authorised, in accordance with Art. 2357-

ter of the Italian Civil Code and with reference

to the reasons set out below, any disposals of

the treasury shares acquired.

Director’s Report on the Group’s Operations in 2022

Here below are the main elements of the

buyback plan authorized by the Shareholders’

Meeting:

Motivations

•Use the Treasury Shares purchased or

already in the Company portfolio as

compensation for the acquisition of interests

within the framework of the Company’s

investments;

•use the treasury shares purchased or already

held in portfolio against the exercise of option

rights, including conversion rights, deriving

from financial instruments issued by the

Company, its subsidiaries or third parties and

to use the treasury shares for lending,

exchange or transfer transactions or to

support extraordinary transactions on the

Company's capital or financing transactions

that imply the transfer or sale of treasury

shares;

•undertake any investments, directly or

through intermediaries, including for the

purpose of containing abnormal movements

in share prices, stabilizing share trading and

prices, supporting the liquidity of the share on

the market, in order to foster the regular

conduct of trading beyond normal fluctuations

related to market performance, without

prejudice in any case to compliance with

applicable statutory provisions;

•to rely on investment or divestment

opportunities, if considered strategic by the

Company, also in relation to available

liquidity;

•to dispose of treasury shares as part of share-

based incentive plans pursuant to Article 114-

bis of the TUF, and of plans for the free

allocation of shares to employees or

members of the governing or supervisory

bodies of the Company or to Shareholders.

Duration

The authorization to purchase treasury shares

is set to last until the approval of the financial

statements for the year ending 31 December

2022 and, in any case, for a period not

exceeding 18 months after that date, while the

authorization to sell is granted to last for an

unlimited period, given the absence of time

limits pursuant to the current regulations and

the opportunity to allow the Board of Directors

to make use of the maximum flexibility, also in

terms of time, to carry out the acts of disposal

of the shares.

During the reference year, the Company

acquired a total of 410,000 treasury shares on

the market, accounting for 0.156% of the share

capital. The purchases were made in execution

of the purchase programme pursuant to Art. 5

of Regulation (EU) No 596/2014, disclosed to

the market on 12 May 2022 and exclusively

aimed to service the three-year performance

share plans established by the ordinary

shareholders’ meeting and in accordance with

Art. 114-bis of the TUF.

During the same period, the 2019-2021

Performance Share Plan Beneficiaries were

assigned a total of 311,847 shares already held

in the portfolio as treasury shares.

Considering the 1,049,838 in the portfolio at the

date of the shareholders’ meeting (28 April

2022), the Company at the date of this report

holds a total of 1,147,991 treasury shares (0.44%

of the share capital).

Maximum number of purchasable

treasury shares

The authorization refers to the purchase, on

one or more occasions and in one or more

tranches, of a maximum number of ordinary

shares with a nominal unitary value of € 0.26,

which - considering the treasury shares already

held by the Company and the shares that may

possibly be acquired by subsidiaries - shall not

exceed a total of 10% of the share capital.

Criteria for purchasing treasury shares

and indication of the minimum and

maximum purchasing cap

Purchases shall be made in compliance with

Articles 132 of the TUF and 144-bis, paragraph 1

letter b) of the Issuer Regulation, and on

regulated markets or multilateral trading

systems, according to the operating criteria

established in the organization and

management regulations of the same markets,

which do not allow the direct matching of buy

orders against predetermined sell orders, and

also in compliance with any other applicable

2022 ANNUAL FINANCIAL REPORT

law, including EU law.

Any purchases relating to the activities to

support market liquidity will also be carried out

in accordance with the conditions provided by

the admitted market practices as per the

combined provisions of Art. 180, subsection 1,

letter C) of the TUF and Art. 13 of Regulation

(EU) No. 596 of 16 April 2014 (the “Admitted

Market Practices”).

Additionally, share purchase transactions may

also be carried out in the manner envisaged in

Article 3 of EU Delegated Regulation no.

2016/1052 in order to benefit, if the conditions

are met, from the exemption under Article 5,

paragraph 1, of EU Regulation no. 596/2014 on

market abuse with regard to inside information

and market manipulation.

The disposal of treasury shares may be carried

out, on one or more occasions and even before

having terminated the maximum number of

purchasable treasury shares, either by selling

them on regulated markets or according to

other trading methods in compliance with the

law, including EU law force and with the

Admitted Market Practices, if applicable.

Under the proposed authorization, purchases

shall be made at a unit price compliant with any

regulatory provisions, including by the

European Community, or admissible market

practices as applicable at the time and where

applicable, without prejudice to the fact that the

minimum and maximum purchase price shall be

determined at a unit price not lower than the

official Stock Exchange price of Mondadori

shares on the day preceding the purchase

transaction, reduced by 20%, and not higher

than the official Stock Exchange price on the

day preceding the purchase transaction,

increased by 10%. In any event - except for any

different price and volume determinations

resulting from the application of the conditions

set forth in the Admitted Market Practices, as

defined at the next point - such price shall be

identified in accordance with the trading

conditions set forth in Delegated Regulation

(EU) no. 1052 of 8 March 2016 and, in particular:

•no shares may be purchased at a price higher

than the higher between the price of the last

independent trade and the price of the

highest current independent bid on the

trading venue where the purchase is carried

out; and

•in terms of volumes, daily purchase amounts

will not exceed 25% of the daily average

volume of Mondadori shares traded as

recorded in the 20 trading days before the

dates of purchase or in the month prior to the

month of the disclosure required by Art. 2,

paragraph 1, of Regulation (EU) no. 1052/2016.

In terms of consideration, sales transactions or

other acts of disposition of treasury shares shall

be carried out:

•if executed in cash, at a price no lower than

10% of the reference price recorded on the

MTA - Euronext Milan - organized and

managed by Borsa Italiana S.p.A. in the

trading session prior to each single

transaction;

•if executed as part of any extraordinary

transactions in accordance with financial

terms to be determined by the Board of

Directors on the basis of the nature and

characteristics of the transaction, also taking

account of the market performance of

Mondadori shares;

•if executed to service the Performance Share

Plans as referred to in paragraph 1 above in

compliance with the terms and conditions set

out in the resolutions of the Shareholders'

Meeting that establish the Plans and the

related regulations.

Report on Corporate Governance

and Ownership Structure (art. 123

bis Legislative Decree no. 58 of 24

February 1998)

The Report on Corporate Governance and

Ownership Structure containing information on

the adoption by Arnoldo Mondadori Editore

S.p.A. of the Corporate Governance Code for

Listed Companies (January 2020 edition)

established by Borsa Italiana S.p.A., as well as

further information pursuant to Article 123 bis,

par. 1 and 2 of Legislative Decree no. 58 of 24

February 1998, is available – together with this

Directors' Report on Operations on the

www.gruppomondadori.it website under the

Governance section, and through the

authorised storage mechanism 1Info

(www.1info.it).

Director’s Report on the Group’s Operations in 2022

Adhesion to the legislative

simplification process adopted by

CONSOB resolution No. 18079 of 20

January 2012. Disclosure pursuant

to Article 70, paragraph 8, and

Article 71, paragraph 1-bis, of

CONSOB Regulation no. 11971/99 as

subsequently amended

On and with effect from 13 November 2012, the

Board of Directors of Arnoldo Mondadori

Editore S.p.A., pursuant to Article 3 of CONSOB

Resolution no. 18079 of 20 January 2012 and in

relation to the provisions set out in Article 70,

par. 8, and Article 71, par. 1-bis of CONSOB

Regulation no. 11971/1999, resolved to avail

itself of the faculty of waiving the obligation of

disclosure envisaged by the aforementioned

CONSOB Regulation on the occasion of

significant transactions relative to mergers,

spin-off and capital increases through

contribution of assets in nature, acquisitions

and transfers.

List of branch offices

The company does not have any secondary

offices.

2022 ANNUAL FINANCIAL REPORT

GLOSSARY OF TERMS

AND ALTERNATIVE

PERFORMANCE

MEASURES USED

This document, in addition to the statements

and conventional financial measures required

by IFRS, presents a number of reclassified

statements and alternative performance

measures, in order to provide a better

understanding of the operating and financial

performance of the Group. These statements

and measures should not be considered as a

replacement of those required by IFRS. With

regard to these figures, in accordance with the

recommendations contained in CONSOB

Communication no. 6064293 of 28 July 2006,

and in CONSOB Communication no. 0092543

of 3 December 2015, as well as with the

2015/1415 ESMA guidelines on alternative

performance measures (“Non-GAAP

Measures”), explanations are given on the

criteria adopted in their preparation and the

relevant notes to the items appearing in the

mandatory statements.

Specifically, the alternative measures used

include:

Gross Operating Profit (EBITDA): net result for

the period before income tax, other financial

income and expense, amortization,

depreciation and write-downs of fixed assets.

The Group also provides information on the

percentage of EBITDA on net sales. EBITDA

measured by the Group allows operating

results to be compared with those of other

companies, net of any effects from financial and

tax items, and of depreciation and amortization,

which may vary from company to company for

reasons unrelated to general operating

performance.

Adjusted gross operating profit (adjusted

EBITDA): gross operating profit as explained

above, net of income and expense of a non-

ordinary nature such as:

•income and expense from restructuring,

reorganization and business combinations;

•clearly identified income and expense not

directly related to the ordinary course of

business;

•as well as any income and expense from non-

ordinary events and transactions as set out in

CONSOB Communication DEM6064293 of

28/07/2006.


(Euro/thousands)	2022	2021

Gross Operating Profit - EBITDA (as shown in the financial statements)	130,740	91,142
Restructuring costs under “Cost of personnel" NOTE 34	3,730	11,218
Expense from acquisition and disposal of companies and business units, (income) expense, NOTE 33 and NOTE 35	1,574	3,690
Loss (profit) from disposal of fixed assets and investments NOTE 35	298	(304)
Adjusted Gross Operating Profit - Adjusted EBITDA (as shown in the Directors' Report on Operations)	136,342	105,747

Director’s Report on the Group’s Operations in 2022

With reference to adjusted EBITDA in 2021, the

following items were excluded from EBITDA:

•Restructuring costs for a total amount of €

11.2 million, included in “Cost of personnel” in

the income statement;

•Net expense of a non-ordinary nature for a

total of € 3.4 million, included in “Other

expense (income)” and “Expense (income)

from investments”.

With reference to adjusted EBITDA in 2022, the

following items were excluded from EBITDA:

•Restructuring costs for a total amount of € 3.7

million, included in “Cost of personnel” in the

income statement;

•Expense of a non-ordinary nature for a total of

€ 1.9 million, included in Other expense

(income) and Expense (income) from

investments.

Operating result( EBIT): net result for the

period before income tax, and other financial

income and expense.

Adjusted operating profit (EBIT Adjusted): this

is represented by the operating result, as

defined above, excluding non-ordinary income

and expense, as defined previously,

depreciation and amortization deriving from the

company purchase price allocation and the

impairment of intangible assets.

Operating profit (EBT): EBT or consolidated

income before tax is the net result for the

period before income tax.

Net Profit adjusted: this is the net result

excluding non-ordinary income and expense,

non-monetary costs deriving from the company

purchase price allocation and impairment of

intangible assets net of the related tax effect

and gross of any non-recurring tax expense/

income.

Net invested capital: the algebraic sum of

Fixed Capital, which includes non-current

assets and non-current liabilities (net of non-

current financial liabilities included in the Net

Financial Position) and Net Working Capital,

which includes current assets (net of cash and

cash equivalents and current financial assets

included in the Net Financial Position), and

current liabilities (net of current financial

liabilities included in the Net Financial Position).

Cash flow from operations: adjusted EBITDA,

as explained above, plus or minus the

decrease/(increase) in working capital in the

period, minus capital expenditure (CAPEX/

Investment).

Cash flow from ordinary operations: cash flow

from operations as explained above, net of

financial expense, tax paid in the period, and

income/expense from investments in

associates.

Cash flow from non-ordinary operations: cash

flow generated/used in transactions that are

not considered ordinary, such as company

restructuring and reorganization, share capital

transactions and acquisitions/disposals.

Free Cash Flow: the sum of cash flow from

ordinary and non-ordinary operations in the

reporting period (excluding payment of

dividends, if any).

Total Cash Flow: the sum of cash flow from

ordinary and non-ordinary operations in the

reporting period (including payment of

dividends, if any).

2022 ANNUAL FINANCIAL REPORT

OUTLOOK FOR THE YEAR

The current Group configuration, the

economic performance and its capacity to

generate cash, as shown in 2022, allow us to

forecast a further improvement in results for

the next year, despite the continued negative

impact of the increase in prices for the

purchase of raw materials and services.

From a strategic point of view, the Group

intends to continue its consolidation of the

core business and therefore its leadership in

the Books Area, both from a publishing point of

view, strengthening its identity and the

specialization of the various publishing houses

and pursuing the vertical integration process in

the various phases of the book chain. In the

School textbook segment, the Group will also

be completing its operative integration project

of D Scuola.

In Retail, Mondadori will on the one hand be

pursuing the selective development of the

network of stores necessary to complete the

capillary coverage of national territory and the

remodelling and downsizing of the sales

outlets, essential to the optimisation of the

commercial surface area and maximisation of

network efficiency, and on the other the effort

of focussing on the book product, which is

essential both in order to increase the area’s

profitability and to emphasise the effectiveness

of conveying the Group’s publishing proposal

to the market.

In a parallel fashion, in the Media area,

Mondadori will continue to develop its digital

skills and range of products, in particular its

presence on social networks and influencer

marketing.

The financial and equity solidity achieved

means that we can continue to pursue the

virtuous development path launched some

years ago, also through the continuous use,

particularly in the book and digital business

area, of M&As whereby the Group seeks to

continue to make the most of inorganic growth

opportunities.

Income Statement

The Group's business-financial targets that

follow refer to a scope that includes only the

extraordinary transaction completed and,

therefore:

•in the Books area, line-by-line consolidation

for the whole year of A.L.I. - Agenzia Libraria

International, De Agostini Libri and

Libromania (consolidated for 9 months in

2022) as well as Star Comics (consolidated

for 6 months in 2022);

•in the Media area, deconsolidation of Press-di

for the entire year and of the print and digital

business referring to the Grazia and Icon

brands.

In light of the above and the reference context,

for the financial year 2023 it is reasonable to

estimate:

•single-digit growth in revenues, in relation to

which the above-listed scope changes will

comprehensively have a neutral impact; the

various business areas are expected to show

different trends: growth in the areas focussed

on the Book product, an increase in the

Digital segment of the Media area and,

consistently with the market trends that show

a structural downturn, the continued decline

of the Media Print activities - which at year

end are expected to account for less than 10%

of the Group’s revenues;

•Single-digit growth of adjusted EBITDA; net

of the recording of relief measures to

museum activities, from which FY 2022

benefited (for approximately € 6.4 million)

and that are not envisaged for 2023, adjusted

EBITDA would show high single-digit growth.

Margins are expected to grow similarly - from

14% to 15% - thanks to:

–targeted pricing policies,

–careful cost-cutting policies

completion of the operative integration of D

Scuola with which the Group is confident it will

be able to more than offset the expected

increase in the costs of raw materials and

services.

Director’s Report on the Group’s Operations in 2022

•The net result of FY 2023 is expected to

grow by approximately 10% - despite greater

depreciation and amortization deriving from

both the increasing investment policy

implemented by the Group and the effects of

the Purchase Price Allocation process -

mainly due to the lack of impairment of

certain balance sheet items, which is currently

not expected to repeat in the new year.

Cash Flow and Net Financial Position

In 2023, the Group is expected to confirm the

significant cash generation capacity shown in

recent years:

•Ordinary cash flow is expected to fall within a

range of € 60 to 65 million, i.e. showing

growth of up to 10% on the 2022 figure, net

of the one-off impact of derivative instruments

related to rate risk hedging;

•the Group’s net financial debt (IFRS 16) is

expected to come in, at end FY 2023, as 1.0x

adjusted EBITDA, down from 1.3x at end

2022.

Dividend Policy

Thanks to the solid financial and equity

conditions that characterise it, the Group

expresses a renewed shareholder

remuneration policy, which expects to

distribute dividends for an annual amount equal

to the greater of 40% of Ordinary cash flow

and the dividend of the previous year.

It is noted that in 2024, in respect of the FY

2023 result, the Board of Directors intends to

propose that the Shareholders' Meeting pay

any potential dividend in two equal tranches (in

May and November).

Each year, the Board of Directors, when

proposing the distribution to the Shareholders'

Meeting, will in any case take account of the

general macroeconomic scenario, as well as

the expected cash flows that will affect the

Group's equity and financial structure.

For the Board of Directors

Chairman

Marina Berlusconi

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2022 ANNUAL FINANCIAL REPORT

Our commitment to sustainability

We contribute to the cultural and social development of the Country through our products and services. A commitment that we pursue as

a Group through our books, our bookstores and our brands, with the goal of spreading an inclusive culture, supporting the communities

and protecting the environment. On this page, from top-left: the "Alta Leggibilità" (Easy-read format) series for children in the Oscar

Mondadori series; the "#Leparolechesiamo, la scuola che vogliamo" (The words we are, the school we want) competition launched by

Mondadori Education; the "Cucina a colori"(Colourful kitchen) manual ,produced by Mondadori Store together with Mondadori Electa; the

Nuovo Devoto-Oli (New Devoto-Oli) by Mondadori Education; Francesca Rigolio, the Group's Chief Diversity Officer, during the webinar

"Mondadori verso un sistema aperto e inclusivo" (Mondadori towards an open, inclusive system); the Christmas initiative "Incarta un libro,

regala un futuro" (Wrap a book, give a future) by Mondadori Store in collaboration with Oxfam; the exhibition-event "Design Re-

Generation" conceived by the magazine Interni for FuoriSalone 2022.


	CONSOLIDATED NON- FINANCIAL STATEMENT pursuant to Legislative Decree 254/2016

CONTENTS


METHODOLOGICAL NOTE	106

1.SUSTAINABILITY FOR THE MONDADORI GROUP	108
1.1 Sustainability Plan	108
1.2 Materiality analysis and stakeholder engagement	110

2. GOVERNANCE - PROMOTING SUSTAINABLE BUSINESS SUCCESS	119
2.1 Governance System	120
2.2 Group ethics and integrity	123
2.3 Main non-financial risks	128
2.4 Strategic business innovation	132

3. SOCIAL - ENHANCING PEOPLE, CONTENT AND PLACES FOR EDUCATION AND CULTURE	134
3.1 Enhancement and management of human capital	135
3.2 Diversity, equity and inclusion	149
3.3 Health and safety in the workplace	153
3.4 Education and the school world	157
3.5 Promotion of reading and socio-cultural growth	160
3.6 Responsibility for content	161
3.7 Ease of use of content	162

4. ENVIRONMENT - ENVIRONMENTAL CULTURE AND MITIGATING ECOSYSTEM IMPACTS	164
4.1 Management of environmental impacts	165
4.2 Life cycle of paper products	165
4.3 Initiatives to reduce the environmental impact	175
4.4 EU taxonomy	179

GRI - BOUNDARY AND TYPE OF IMPACTS	183

GRI CONTENT INDEX	185

METHODOLOGICAL NOTE

This document embodies the Consolidated

Non-Financial Statement (hereinafter also the

"Statement" or “NFS") pursuant to Legislative

Decree 254/2016 (hereinafter also the

"Decree"), in implementation of Directive

2014/95/EU, by the Group composed of

Arnoldo Mondadori Editore S.p.A., with

registered office in Segrate (Milan) and its fully-

consolidated subsidiaries (hereinafter also the

"Mondadori Group" or the "Group"), operating

in Italy and in the United States of America. The

reporting period for the information and data

provided in this NFS is 2022 (1 January - 31

December).

Consistent with one of the two options

envisaged in Article 5 of Legislative Decree

254/2016, the NFS is included with specific

wording within the Mondadori Group's Report

on Operations for 2022. This NFS, prepared on

an annual basis, is also published on the

Group’s website, www.gruppomondadori.it, as

part of the 2022 Annual Report and in the

"Sustainability" section.

The NFS was drawn up insofar as needed to

ensure an understanding of corporate activities,

performance, results and the impacts it

generates, by covering the topics deemed

relevant and provided for in Articles 3 and 4 of

Legislative Decree 254/2016, i.e. with regard to

environmental, social, personnel-related

aspects, respect for human rights, and the fight

against corruption and bribery.

The reporting standards adopted by the Group

to prepare its NFS are the GRI Sustainability

Reporting Standards (GRI Standards). This

report was prepared in accordance with GRI

Standards: In accordance option. The GRI

Content Index, detailing content reported in

accordance with GRI, can be found in the

annex to the document.

In line with the provisions of the GRI Standards,

the Mondadori Group has drawn inspiration

from the principles of sustainability context,

completeness, balance, clarity, accuracy,

timeliness, comparability and verifiability, to

ensure the quality of information and the

appropriateness of the presentation methods.

The content reported on was selected based

on the materiality analysis updated in 2022,

which allowed for the identification of the

material aspects representing the most

significant impacts of the organisation on the

economy, environment and people, also with

reference to the protection of human rights.

The material aspects have also been submitted

for stakeholder assessments, as required by

GRI Standard guidelines. The results of the

materiality analysis are presented in the section

"Materiality analysis and stakeholder

engagement".

In accordance with the requirements of the

Decree, the reporting scope matches the scope

of the consolidated financial statements,

including all companies consolidated on a line-

by-line basis in financial reporting (please refer

to the section "Structure of the Mondadori

Group" on page 15). Any exceptions to the

reporting scope shown above are duly

highlighted in the document; however, these

limitations are not considered relevant for the

understanding of the company’s business,

performance, results and the impacts it

generates.

As regards the changes that took place in

scope, organisational structure and ownership

during the year, note that on 1 April 2022 the

Mondadori Group completed the acquisition of

50% of the share capital of De Agostini Libri

S.r.l. (formerly DeA Planeta Libri), a company

specialised in trade books with focus on the

children's and non-fiction segments. The scope

of the transaction includes Libromania S.r.l.,

wholly-owned by De Agostini Libri and active in

the promotion of third-party publishers. The

transaction is in line with the strategy of

increasing the focus on the core business of

books, pursued also through a process of

vertical integration in the books market.

On 1 July 2022, 51% of Edizioni Star Comics

S.r.l. was purchased and it is reported that the

scope of the transaction also includes the

acquisition, completed in January 2023, of

100% of Grafiche Bovini S.r.l., a company

controlled by the same family of founders,

specialised in printing activities exclusively of

products published by Edizioni Star Comics. On

1 July 2022, the Mondadori Group completed

the disposal of 51% of Press-di Distribuzione

Stampa e Multimedia S.r.l. and thereafter sold a

further 29% share.

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2022 ANNUAL FINANCIAL REPORT

In addition, on 22 November 2022, the option

to sell was exercised in respect of the print and

digital publishing activities of the Grazia and

Icon magazines, as well as the related

international network.

Note that starting 1 January 2022, the

transactions launched in 2021 for the

acquisition of 100% of D Scuola S.p.A., (formerly

De Agostini Scuola S.p.A.) and for the sale by

the subsidiary Mondadori Media S.p.A. of the

BU comprising the editorial activities of Donna

Moderna and CasaFacile, take effect, also in

terms of non-financial reporting.

For comparative purposes and to highlight the

trends in quantitative information, data

pertaining to the current reporting year and,

where possible, to the prior two years, are

shown. In order to ensure the reliability of

information reported, the use of estimates has

been restricted as much as possible, and,

where used, are based on the best available

and appropriately reported methods.

The qualitative and quantitative information

appearing in this document was collected,

aggregated and disseminated at Group level;

all the relevant company departments were

involved in defining this information, and acted

in concert with and coordinated by internal CSR

officers. Shown below are the main calculation

methods and assumptions used for the non-

financial performance measures reported in this

NFS, in addition to the information provided in

the various sections:

•data relating to economic sanctions and

contributions received from Public

Administration are shown on a cash basis;

•in the breakdown of the workforce by

grading, “executives” include editors-in-chief

and deputy editors-in-chief of magazines;

members of the Board of Directors are not

included;

•where environmental data were unavailable,

conservative estimates were used, resulting

in the underestimation of the company’s

environmental performance.

This NFS was approved by the Board of

Directors of Arnoldo Mondadori Editore S.p.A.

on 16 March 2023.

This document was subject to limited review, in

accordance with the International Standard on

Assurance Engagement (ISAE 3000 Revised),

by the Independent Auditors EY S.p.A.. The

quantitative indicators not referring to any

general or topic-specific disclosure of the GRI

Standards, reported on the pages specified in

the Content Index, have not been subjected to

a limited review by EY S.p.A..

107

Consolidated non-financial statement

1. SUSTAINABILITY FOR THE MONDADORI GROUP

We are passionate publishers, advocating

quality, equitable and inclusive education,

providing opportunities for reading and growth,

entertainment and enrichment.

Our mission is to foster the spread of culture

and ideas through products, activities and

services that meet the needs and tastes of the

widest possible audience. In our vision, love for

culture and editorial quality live together with

the laws of the market, the propensity to sense

and anticipate changes with respect and

protection of the values that are the

cornerstones of the role of a publisher in civil

society.

We are aware that such a role requires a

natural and ever-growing focus on defining

strategies and pursuing clear sustainability

objectives aimed at creating long-term value,

benefiting and taking account of the interests

of all our stakeholders.

In light of the commitments made, in 2022, the

first Three-Year Sustainability Plan was

approved, within which strategic areas,

quantitative and qualitative targets and short-

and medium-term actions have been identified,

aimed at assuring the continuous improvement

of social, governance and environmental

performance.

Constant monitoring has been carried out of

the objectives, to provide a timely image of the

degree to which they have been achieved and,

at the same time, identify new action for the

future, to continue updating the Plan.

This path has seen the participation of

company management and has been

enhanced by a great many stakeholder

engagement activities with the participation

also of new categories of stakeholders. The

Group's approach to the future in the field of

sustainability is currently divided into three

macro-areas of reference and eight strategic

guidelines with objectives linked to the

Sustainable Development Goals (SDGs) laid

down in the context of the 2030 Agenda for

Sustainable Development.

1.1 SUSTAINABILITY PLAN


SOCIAL - Enhancing people, content and places for education and culture	GOVERNANCE - Promoting sustainable business success	ENVIRONMENT - Dissemination of an environmental culture and mitigation of impacts on ecosystems

Enhancing people, content and places for

education and culture

1.To become a role model in the field of

Diversity, Equity and Inclusion, enhancing and

contributing to the well-being of our people,

through welfare tools and skills development.

2.To promote culture and quality, equitable,

and inclusive education that fosters pathways

to lifelong learning.

3.To create, conceive and develop valuable

content and accessible, ESG-friendly

products.

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2022 ANNUAL FINANCIAL REPORT

4.To support cultural outposts for social

development through the enhancement of

bookstores, schools, museums, social

channels, events and partnerships.

Promoting sustainable business success

1.To pursue sustainable business success by

promoting the integration of ESG issues in

governance, business plans and the

operating model, also by strengthening the

mechanisms for listening to stakeholders to

develop paths of ongoing improvement.

2.To maintain the highest standards for

protecting and managing risks and

opportunities along the value chain.

Disseminating environmental culture and

mitigating impacts on ecosystems

1.To spread environmental culture, also

through education aimed at the development

of an increasingly sustainable lifestyle.

2.To mitigate environmental impacts along the

product life cycle, by fostering the protection

of biodiversity and reducing climate-changing

emissions.

With regard to the previously mentioned

guidelines, clear objectives have been set for

the three-year period.

In 2022, in accordance with the Plan, a great

many activities detailed in the respective

chapters, were completed.

With the aim, therefore, of sharing the actions

and targets on which the Mondadori Group has

worked throughout the year, below is an

extract of the Sustainability Plan with the main

objectives achieved.

ENHANCING PEOPLE, CONTENT AND PLACES FOR EDUCATION AND CULTURE


SOCIAL	1. Development and endorsement of a well-structured framework of KPIs for monitoring all D&I-related actions, with specific regard to the gender pay gap and gender balance.	2022
	2. Development of the hybrid working project for the joint definition of a new mixed working model.	2022
	3. Extension to 100% of the school offer of contents/insights in Sustainability, 2030 Agenda for Sustainable Development, diversity, equity and inclusion and civic education.	by 2023/ continuous
	4. A growing number of initiatives/services to promote reading.	2022/ continuous
	5. Strengthening of ESG training for the Group’s school publications and those for teachers.	2022/ continuous

PROMOTING SUSTAINABLE BUSINESS SUCCESS


GOVERNANCE	1. Definition and measurement of LTI, quantitative and measurable objectives, linked to ESG topics for the Top Management. Inclusion of the Impact Inclusion Index in the 2022-2024 Performance Share Plan.	2022
	2. Strengthening of the set of procedures and coverage of the areas of Privacy, Information Management and Cyber Security.	2022/ continuous
	3. Strengthening of the programmes aiming to protect intellectual property/copyright.	2022/ continuous
	4. Strengthening of stakeholder engagement activities through the gradual expansion of engagement initiatives.	ongoing

109

Consolidated non-financial statement

DISSEMINATION OF AN ENVIRONMENTAL CULTURE AND MITIGATION OF IMPACTS ON

ECOSYSTEMS


ENVIRONMENT	1. Extension to 100% of the School proposition of insights and fact sheets dedicated to environmental culture and promotion of such content in the Trade proposition.	2023/ continuous
	2. Fulfilment of =100% purchase of PEFC/FSC certified paper for Mondadori Group products. Extension to the newly acquired companies.	2022/ continuous
	3. Pursuit of energy efficiency actions, also as part of property/building/store renovation initiatives, and assessment of further potential pilot activities to reduce greenhouse gas emissions.	ongoing

During the year, the Plan was updated, through

the implementation of benchmarking activities

and the start-up of a working group to assure

continuous improvement.

The Sustainability Plan was developed in line

with the materiality analysis and stakeholder

engagement processes carried out by the

Group, the main elements of which are outlined

in the following paragraphs. The Plan was

approved by Top Management, the Control,

Risk and Sustainability Committee and the

Board of Directors.

1.2 MATERIALITY ANALYSIS AND

STAKEHOLDER ENGAGEMENT

The Mondadori Group periodically carries out a

materiality analysis process, in order to identify

the elements of strategic interest in the field of

sustainability and ensure the correct

presentation and understanding of the Group's

activities, its performance, results and the

impacts generated.

Specifically, the year 2022 saw an update of

the materiality analysis, which, in light of the

evolution of guidelines on sustainability

reporting, focussed on identifying the positive

and negative impacts generated by the Group

on the environment, economy and people,

including human rights.

This is based on four phases, further detailed

below:

a) mapping of relevant stakeholders;

b)identification of current and potential

negative and positive impacts generated by the

Group directly and through its value chain, in

line with the reference industry trends and the

priorities identified in the Sustainability Plan;

c) prioritization of identified sustainability topics

(and related impacts) through internal and

external stakeholder engagement activities;

d) identification of material topics and their

approval.

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2022 ANNUAL FINANCIAL REPORT

a) Mapping of relevant stakeholders

The main categories of internal and external stakeholders considered priority for the Group in terms of

influence and interest are summarized in the chart below.

Mappatura degli stakeholder_ENG (1)v2.png

Well aware of the importance of establishing

and maintaining a constant dialogue with its

stakeholders, the Mondadori Group has

opened up various channels of communication

and engagement with them, in order to

understand and take their demands into

consideration. The table below summarizes the

main communication and engagement methods

implemented by the Group for each category of

stakeholder.

111

Consolidated non-financial statement


Stakeholder Category	Details of stakeholders by category	Summary of the communication and engagement methods
Shareholders	Majority shareholders	•Shareholders’ Meeting •Dialogue channels under the Investor Relations function
Shareholders	Non-controlling interests
Financial community	Analysts/rating agencies	•(Virtual) meetings with institutional investors •Dialogue channels under the Investor Relations function
	Banks
	Investors
Consumers	Bookstores and newsstands customers	•Support channels and direct assistance through the retail network (stores and e-commerce)
	Users of online content and services
	Book readers
	Magazine readers
	Students/student families
Institutions	Antitrust	•Ad hoc discussions on specific topics •Institutional round tables •Formal communications
	Trade associations
	CONSOB
	National/Community lawmaker
	Public Administration
Educational world	Ministry of Education and Research	•Ad hoc discussions on specific topics •Institutional round tables •Formal communications •Faculty survey
Educational world	Teachers/educators
Museum world	Museums	•Participation in tenders •Institutional round tables
	Superintendencies
	Museum visitors
Opinion leaders	Media	•Media relations activities
	Influencers and bloggers
	Authors
Partners	Agents (bookstores - school textbooks)	•Regular meetings with suppliers •Franchisee conventions
	Competitors
	Newsstands
	Third-party publishers
	Suppliers
	Large retailers
	Advertisers
	Booksellers
	Group publishing brands
	Our franchisees
	Digital platforms OTT + Chili/ Infinity/Netflix
Human resources	Employees	•Regular meetings with union representatives •Institutional round tables •Employee surveys •Weekly Crisis Committee meetings
	Associates
	Advisors
	Trade unions
	INPS, INAIL
Third sector	NGOs	•Regular discussions on project development
Third sector	Non-profit organizations	•Regular discussions on project development

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2022 ANNUAL FINANCIAL REPORT

b) Identification of current and potential

negative and positive impacts generated by

the Group, in line with the reference industry

trends and the priorities identified in the

Sustainability Plan

In order to identify the list of sustainability

topics that represent the main impacts

generated directly by the Group and through its

value chain, first consideration was given to the

topics that had emerged from the materiality

analyses of prior years. The definitions

associated with the topics, as well as the details

of the positive and negative impacts generated

and that characterise them were updated in

light of the reference industry trends and

priorities identified in the field of sustainability.

The process was also developed through

implementation of specific benchmark analyses

in the area of sustainability and the direct

engagement of the Sustainability Committee.

Compared with the previous edition of the NFS,

there has been an essential continuity in

respect of the sustainability topics submitted for

voting; the main changes in fact refer to actual

topic wording. More specifically, in 2022,

certain definitions were updated.

The main detailed changes made include the

change to the topics previously named

"Enhancement and management of human

capital” to “Enhancement, loyalty and attraction

of people”, “Supply chain management” to

“Responsible supply chain management”, “Life

cycle of paper products” to “Product life cycle

and the circular economy” and, finally, “Climate

change” to “Climate Change and biodiversity”,

which includes all impacts the Group may have

on biodiversity (with specific reference to the

use of paper).

In addition, note that the topic “Environmental

impact management” has been included in the

latter two, whilst the topics “Ease of use of

content” and “Responsibility for content” have

been encompassed into “Accountability and

accessibility of content”, just like “Business

integrity and combating corruption” and

“Economic performance” have been combined

into “Sustainable success, ethics and business

integrity”.

Below, therefore, is the list of topics

considered, highlighting the potential and

current positive and negative related impacts,

and which have been assessed in the

subsequent materiality analysis process.

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Consolidated non-financial statement


Impact area/ Sustainability topic of interest	Correlation with macro-area of the Mondadori Sustainability Plan	Correlation with the main reference SDGs	Mapping of positive/negative impacts generated
Product life cycle and the circular economy	ENVIRONMENT - Disseminating environmental culture and mitigating impacts on ecosystems		Negative impact on the environment deriving from waste production and the consumption of paper and materials. This impact is limited by waste recovery operations, reduction of products assigned for scrap, purchase of certified paper.
Climate change and biodiversity	ENVIRONMENT - Disseminating environmental culture and mitigating impacts on ecosystems		Negative impact on climate change and biodiversity deriving from paper and energy consumption (and the related emissions) of the organisation and along the supply chain. This impact is mitigated by the purchase of certified paper and energy efficiency initiatives. The Group is also committed through the inclusion and promotion of contents linked to the environmental culture and the 2030 Agenda in the whole of the school production.
Diversity, equity and inclusion	SOCIAL - Enhancing people, content and places for education and culture		Positive impact on the company through a correct management of suppliers, attention to their ESG performance and the promotion of innovation throughout the value chain. Failure by the Group to properly oversee its value chain would instead give rise to potential episodes of violation of human rights with impacts on human dignity and community development.
Responsible Supply Chain Management	Cross-cutting		Positive impact on the company through a correct management of suppliers, attention to their ESG performance and the promotion of innovation throughout the value chain. Failure by the Group to properly oversee its value chain would instead give rise to potential episodes of violation of human rights with impacts on human dignity and community development.

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2022 ANNUAL FINANCIAL REPORT


Strategic business innovation	Cross-cutting	Positive impacts on readers through the definition of innovative offers, editorial contents of value and accessible, ESG-friendly products.
Education and the school world	SOCIAL - Enhancing people, content and places for education and culture	Positive impact on students and families thanks to the promotion of high quality, fair and inclusive education, which fosters continuous learning and fights school abandonment. Spread and promotion of the contents of the 2030 Agenda in the whole of the school offer and development of best practices for ESG teaching.
Privacy and data protection	GOVERNANCE - Promoting sustainable business success	The absence of mechanisms to protect sensitive information and data could cause the violation of the privacy of customers and/or other stakeholders.
Promotion of reading and socio-cultural growth	SOCIAL - Enhancing people, content and places for education and culture	Positive social impact on literacy through initiatives to promote culture and reading. To support cultural outposts for social development through the enhancement of bookstores, schools, museums, social channels, events and partnerships.
Sustainable development promotion	SOCIAL - Enhancing people, content and places for education and culture ENVIRONMENT - Disseminating environmental culture and mitigating impacts on ecosystems	Positive impact on readers, students and teachers through the definition of editorial contents and initiatives, including training, focussed on environmental and social topics.

115

Consolidated non-financial statement


Accountability and accessibility of content	SOCIAL - Enhancing people, content and places for education and culture	Social impact deriving from the spread of quality, reliable, accessible and inclusive contents.
Health and safety in the workplace	SOCIAL - Enhancing people, content and places for education and culture	Impact on worker health and safety following Group management. This impact is mitigated by risk management activities and dedicated training.
Sustainable success, ethics and business integrity	Cross-cutting	The breach of regulations to which the Group and its value chain are subject and the lack of risk management systems could negatively impact the economy and markets on which it operates.
Intellectual property and copyright protection	GOVERNANCE - Promoting sustainable business success	The lack of measures dedicated to protect intellectual property and editorial independence would have a negative impact on the stakeholders concerned.
Enhancement and reputation of brands and publishing trademarks	GOVERNANCE - Promoting sustainable business success	Positive social impact through the multichannel, multi- product structure of contents and the promotion of ESG topics marketed by the brands.
Enhancement, loyalty and attraction of people	SOCIAL - Enhancing people, content and places for education and culture	Direct/indirect positive economic impacts on the families and local communities through the generation of professional opportunities. Development of employee competences through staff training activities.

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2022 ANNUAL FINANCIAL REPORT

c) Prioritization of identified sustainability

issues in relation to impacts, through internal

and external stakeholder engagement

activities

In order to prioritize the sustainability topics

identified for the Group, specific internal and

external stakeholder engagement activities

were carried out.

These listening opportunities have seen the

active involvement of company management

(the Steering Committee and the Internal

Sustainability Committee), employees and

equally important interlocutors, including

teachers and customers of our bookshops. For

the first time, new categories of stakeholders

were also included - suppliers and financial

analysts and investors - identified on the basis

of criteria of strategic relevance for the Group,

both in terms of business and sustainability.

The engagement occurred with the

administration of an on-line questionnaire in

November.

More than 9,500 completed versions were

submitted, specifically approximately 4,800 by

the teaching staff and more than 3,800 by

customers and readers, thanks to the

relationship the Group has developed over time

with these categories in light of their crucial

importance.

The stakeholders involved were asked to

identify, in line with their own expectations and

needs, the areas of impact they consider more

or less relevant for the Group. Continuing on

from the experience accrued in previous years,

the participation of the Group's internal and

external stakeholders was paramount in the

process of updating the materiality analysis in

2022, as it made it possible to identify the

topics of interest and to capture with greater

clarity and depth the different perspectives and

information needs that mark the stakeholders

involved.

FOCUS

Financial analysts and investors - Suppliers

The analysis process aimed at defining the material topics, in line with the objective of

strengthening stakeholder engagement envisaged in the Sustainability Plan, saw, for the

first time, the inclusion of two new categories of Group stakeholders: financial analysts/

investors and suppliers. This has made it possible to assess the impacts generated with a

greater depth of analysis and glean additional useful information to increasingly satisfy the

needs of our stakeholders.

The results of the survey of financial analysts and investors specifically revealed the growing

centrality of ESG topics as a decision-making factor, also thanks to the consultation of

specific ratings. 50% of those interviewed declared that they sought the advice of ESG

experts in their working teams. Overall, perception by this category of Mondadori's

positioning with respect to the sector on sustainability-related topics was above average,

scoring approximately 4 on a scale of 1 to 5.

The involvement of suppliers, identified on the basis of criteria of strategic relevance for the

Group, both in terms of business and sustainability, instead revealed the importance of a

synergistic approach to sustainability topics. Suppliers scored the question on just how far

continuous improvement in social, environmental and governance sustainability can

contribute to improving competitiveness on the markets of today and the near future an

average of more than 4.5 (on a scale of 1 to 5). This category also stated that the purchase of

certified energy from renewable sources was an area on which they focussed their efforts.

d) Identification of material topics and their

approval

The results of the stakeholder engagement

analysis allowed for the identification of the

material sustainability aspects for the Group

and its stakeholders, continuing on from what

had been done for the previous editions of the

NFS, and presented below.

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Consolidated non-financial statement

The results of the 2022 materiality analysis

were submitted for review and validation by the

Control, Risk and Sustainability Committee. The

list of material topics identified guided the

identification of the content on which to base

the non-financial reporting expressed by this

document, consistent with the requirements of

Legislative Decree 254/2016 and the GRI

Standards.

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2022 ANNUAL FINANCIAL REPORT

2. GOVERNANCE

Promoting sustainable business success

The Mondadori Group's organizational and

management model is designed to ensure the

economic sustainability of the company and the

creation of long-term value, highlighting the

mission and values that guide the day-to-day

management of the Group’s operations; this is

witnessed by the Group’s compliance with the

external codes and regulations that shape its

governance and control system.

In this context, the Code of Ethics, the

Organisation, Management and Control Model

ex 231 and the whistleblowing system

represent some of the main safeguards in place

to maintain best practices in business ethics.

Moreover, the Group acts in compliance with

the relevant guidelines and national and

international standards, including those

concerning privacy and data security, for which

specific training is provided to employees.

A specific Sustainability Policy has also been

formalized, which refers to the values and

mission of the Group, as well as the main

commitments towards the stakeholders that the

Group listens to and constantly involves in

order to nurture continuous improvement

processes. In this context, a Policy on Investor

and Shareholder Engagement was formalized

during 2021.

The Group system of policies and procedures is

updated constantly to ensure its compliance

with new regulations and alignment with best

practices in terms of the relevant measures in

place.


	The Mondadori Group’s approach to the future in the field of sustainability is laid out consistently with the two strategic guidelines defined in the Sustainability Plan (see paragraph 1.1) with the following future objectives connected with the Sustainable Development Goals (SDGs) laid down in the 2030 Agenda. The objectives achieved or started in 2022 are described in the next few paragraphs.


FOCUS	Definition and measurement of LTI, quantitative and measurable objectives, linked to ESG topics for the Top Management. Inclusion of the Impact Inclusion Index in the 2022-2024 Performance Share Plan.	2022
	Strengthening of the set of procedures and coverage of the areas of Privacy, Information Management and Cyber Security.	2022/ continuous
	Strengthening of the programmes aiming to protect intellectual property/copyright.	2022/ continuous
	Strengthening of stakeholder engagement activities through the gradual expansion of engagement initiatives.	ongoing
	Development and implementation of a professional refresher plan for members of the Board of Directors dedicated to specific ESG topics.	by 2023
	Strengthening of the internal control and risk management system in ESG and continuous training on a progressively broader population.	by 2023
	Formalisation of an Anti-Corruption Policy.	by 2023

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Consolidated non-financial statement

2.1 GOVERNANCE SYSTEM

Arnoldo Mondadori Editore S.p.A. has adopted

a corporate governance system organised

according to the “traditional” administration and

control model as per Articles 2380-bis et seq.

of the Italian Civil Code, structured as a Board

of Directors, a Board of Statutory Auditors -

with supervisory and control duties over the

compliance with regulatory and statutory

provisions of the Group’s organisational and

governance structure - and Independent

Auditors tasked with auditing the accounts of

the separate and consolidated financial

statements and the condensed interim financial

statements.

These bodies are appointed by the Ordinary

Shareholders' Meeting. The Board of Directors

is appointed through the list voting system, in a

manner that enables the identification of

directors and is also an expression of the

wishes of the minority shareholders.

The Group also adheres to the Corporate

Governance Code, promoted by Borsa Italiana

S.p.A. as a reference framework for the

definition of its governance system.

The Board of Directors plays a central role in

the Group’s corporate governance system

through the determination of the company’s

and Group’s strategic and organisational

guidelines and is assigned, in accordance with

the By-laws, all powers for the ordinary and

extraordinary management of the Company,

except for the powers and duties reserved by

law to the competence of the shareholders'

meeting.

The Board of Directors has 3 internal board

committees made up of non-executive directors

of whom the majority are independent and, in

particular, in addition to the Remuneration and

Appointments Committee and the Related

Parties Committee, the Control, Risk and

Sustainability Committee, with an advisory role

and one of making suggestions, also in respect

of sustainability topics.

For the purposes of this NFS, a summary of the

governance structure adopted by the Group is

provided below, with specific reference to the

structure and composition of the various bodies

and/or subjects making up the comprehensive

system.

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2022 ANNUAL FINANCIAL REPORT

2.1.1 Sustainability Governance

Under the scope of the strategic guidance

issued by the Board of Directors, the pursuit -

through a progressive training process

structured according to the phases and

methods explained in this document - of

sustainable success becomes particularly

important and is configured by the creation of

value in the long-term, to the benefit of

shareholders and taking account of the

interests of all stakeholders relevant to the

Issuer.

Under the scope of Sustainability Governance,

the Control, Risks and Sustainability

Committee* plays an investigative, consulting

role and makes suggestions to the Board of

Directors on sustainability-related assessments

and decisions with particular regard to the

approval of the NFS and the Sustainability Plan.

In order to allow for further consolidation and

optimisation of the organisational structure

relative to sustainability oversight, the Board of

Directors has assigned a senior management

figure - Antonio Porro - the responsibility for the

Development and Management of activities

relating to Sustainability Plan and related

topics.

In the exercise of the appointment, reporting

hierarchically directly to the Board of Directors,

Antonio Porro reports back periodically to the

Control, Risk and Sustainability Committee.

The Internal Sustainability Committee**

instead oversees - reporting to the senior

manager appointed as responsible for

Development and Management identified

above - proposals relating to ESG areas and

non-financial reporting activities, which the

Group has been developing since 2017 based

on materiality analysis processes aligned with

the company's strategic approach, reporting to

the Chief Executive Officer.

The Committee, chaired by the

Communications Director, is made up of the

corporate and business functions; it meets

121

Consolidated non-financial statement

periodically to assess operational proposals in

the field of sustainability, and reviews and

validates the draft Consolidated Non-Financial

Statement.

The following table shows the composition of

the Board of Directors of the parent company

Arnoldo Mondadori Editore S.p.A. by gender

and age bracket. Specifically, at 31 December

2022, the composition by gender is broken

down as 42% women and 58% men, and the

composition by age is broken down as 8%

between 30 and 50 years old, and 92% over 50

years old.

Composition by gender and age of the Board of Directors


Age	at December 31, 2022				at December 31, 2021				at December 31, 2020
Age	Wome n	Men	Total (no.)	Total (%)	Wome n	Men	Total (no.)	Total (%)	Wome n	Men	Total (no.)	Total (%)
30-50 years old
>50 years old	1	0	1	8%	1	0	1	8%	1	0	1	7%
Total (no.)	4	7	11	92%	4	7	11	92%	4	9	13	93%
Total (%)	5	7	12	100%	5	7	12	100%	5	9	14	100%
Totale (%)	42%	58%	100%		42%	58%	100%		36%	64%	100%

Corporate Governance Report

Reference is made to the Report on Corporate

Governance and Ownership Structures - made

available at the same time as this document on

the website www.gruppomondadori.it, in the

“Governance” Section and on the authorised

storage system 1info - Sdir & Storage - for a

detailed description of the governance

structure, with particular reference to:

i.Composition and internal competences,

process of appointment and duties - also in

respect of training and the definition of

sustainability strategies - of the Board of

Directors, the Control, Risk and

Sustainability Committee and the other

internal board Committees;

ii.Organisational model, also in respect of

criticality management;

iii.Training and induction processes for the

Board of Directors;

iv.Self-assessment process of the Board of

Directors.

Remuneration Report

In the Report on Remuneration Policy and

Compensation Paid, Arnoldo Mondadori

Editore S.p.A. describes the remuneration

policies connected with the members of the

most senior governance body and senior

managers, as well as the process by which they

are processed.

The document is available at the same time as

this document on the website

www.gruppomondadori.it/, in the “Governance”

Section and on the authorised storage

mechanism 1info.

The Group has monitored the ratio of the

remuneration of the highest paid individual and

the annual median remuneration of all

employees of the Group’s Italian companies22.

This ratio is 34.03 in 2022, while in 2021 it was

27.72. The ratio of the percentage increase of

remuneration of the person receiving the

highest remuneration and the median

percentage increase of all employees is 12.66.

The value of the median has increased by 2%

compared with last year, while the value of the

highest remuneration has increased by 25.2%.

Note that the reason for this difference is due

to the fact that the CEO was appointed in April

2021 and the new compensation impacted the

annual effective remuneration for just 8 months,

while in 2022 the effect was full for all 12

months.

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2022 ANNUAL FINANCIAL REPORT

22 The value of remuneration used for the calculation takes into account: the gross annual remuneration for FTEs, the variable amount

linked to MBOs and LTIs disbursed and all other variables coming together to make up total remuneration.

2.2 GROUP ETHICS AND

INTEGRITY

As mentioned in the introduction to this

chapter, the Mondadori Group's organizational

and management model is designed to ensure

the economic sustainability of the company and

the creation of long-term value, highlighting the

mission and values that guide the day-to-day

management of the Group’s operations; this is

witnessed by the Group’s compliance with the

external codes and regulations that shape its

governance and control system.

In applying an Organizational, Management

and Control Model (for the Parent Company

and with appropriate versions for each of its

Italian subsidiaries), the Mondadori Group has

set itself the goal of adopting a set of protocols

which, as a supplement to the system for

assigning powers and responsibilities, together

with the other organizational tools and internal

controlling, form a fitting system able to prevent

criminal and administrative offences and raise

awareness among employees and associates

of the rules of conduct to follow when

performing their tasks. The Model and its

Guidelines are constantly updated and meet

the different needs of the companies that are

part of the Group.

Both of these documents refer to a set of

ethical standards, identified by legislation,

regulations and codes of conduct, which the

company incorporated into its own regulations

in 2012 with the adoption of a new Code of

Ethics that extends to all Group companies. The

corporate Code of Ethics sets out general

ethical principles (respect for human rights and

law, transparency, protection of intellectual

property and the independence of information)

and specific principles in relation to the

different stakeholders, including customers,

suppliers, employees, investors, communities,

institutions and the environment.

The Code of Ethics, therefore, outlines the set

of principles and rules of conduct to be

followed by the directors, employees and

associates of Group companies within the

scope of their respective roles and duties. The

Code of Ethics and its provisions are

incorporated into the contractual obligations

undertaken by the counterparties. Any

infringement of the Code of Ethics, therefore,

constitutes a breach of contract, entailing the

consequences of law, including termination of

the contract or engagement and claims for

damages.

In this sense, compliance with the principles set

out in the Code of Ethics is required not only of

employees and associates, but is also

incorporated into supply agreements, together

with the obligation to comply with Community

legislation and minimum working age laws.

As a sign of its growing commitment to

sustainability, the Group has officially endorsed

the more specific policies set out by industry

associations, such as the Sodalitas

Foundation’s Charter for Equal Opportunities

and the Valore D Manifesto, undertaking a

commitment to promote talent regardless of

gender.

Other steps have been taken over the years,

such as the creation and constant updating of

operational rules and procedures governing

specific company operations, to make

compliance with a changing legal framework

part and parcel of daily work practices and to

respond effectively to the new needs brought

by the evolution of business.

In other cases, such as, for example, the issue

of privacy in journalism, the Mondadori Group

refers to external regulations and standards, in

this specific case the Code of Ethics for the

Processing of Personal Data in the Practice of

Journalism, envisaged in Legislative Decree

196/2003 and incorporated into the Charter of

Duties of Journalists.

With regard to environmental sustainability,

since 2012 the Group has adopted an

environmental policy designed to reduce the

impact from its operations. Such policy has

delivered tangible results in terms of major cuts

in greenhouse gas emissions and, in primis, the

growing use of certified paper for its products.

Specific operating rules have also been

adopted for other issues of lesser or non-

material relevance, such as waste

management.

In 2017, guidelines for the publication of

content and material on Group websites were

set out and officially released in February 2018.

The guidelines, together with training provided

to journalists on copyright and the Web and on

privacy in journalism, organized by the Legal

and Corporate Affairs Department, address

issues connected with the handling of sensitive

editorial content in newspapers and on online

123

Consolidated non-financial statement

news channels, websites and social media

accounts belonging to the Mondadori Group.

For further details on the Group's policies on

privacy and personal data protection, reference

is made to the section “Privacy and personal

data protection”.

We should mention the 2018 approval of the

Group’s Sustainability Policy, reflecting

Mondadori's values and mission; it indicates six

key commitments that are consistent with the

Company's activities and its role in society:

•providing customers with the possibility of

benefiting from innovative and quality

products;

•actively promoting a culture that is accessible

to everyone, aware that the right to quality

education and information is a crucial element

in the development and growth of a country;

•giving voice to different points of view,

rewarding originality and the diversity of

thought, and ensuring respect for freedom of

expression in the process of developing

publishing products;

•investing in the professional development of

people, enhancing their talent and

encouraging them to be creative and

enterprising;

•creating a safe workplace for employees and

associates that provides equal opportunities

for personal and professional achievement

and expression;

•respecting and protecting the surrounding

environment through the responsible use of

natural resources and main energy carriers,

reduction of polluting and climate-changing

emissions, careful waste management and

customer and supplier awareness on

environmental sustainability issues.

With the introduction in 2019 of the

whistleblowing system to make and manage

reports of alleged or actual unlawful conduct

relevant pursuant to Legislative Decree

231/2001, and alleged or actual violations of

Models 231 and/or the Code of Ethics adopted

by Group Companies, in full respect and

protection of the reporter and the reported

person, the related procedure was issued and

the Model and Guidelines of the Parent

Company and all companies were updated.

In 2022, there were also no reports made to

the Board of Directors of any potential or actual

negative impacts regarding the conduct of the

organisation in its operations and business

relations.

Supply chain

Responsible supply chain management is one

aspect to which the Group pays close attention.

Correct management in fact guarantees

business continuity and fosters the involvement

of suppliers aligned with the Mondadori

approach and operations, both in terms of

compliance with current regulations and

sustainable development. Compliance with the

principles set out in the Group's Code of Ethics

is required not only of employees and

associates, but is also incorporated into supply

agreements, together with the obligation to

comply with Community legislation and

minimum working age laws.

The Code and its provisions are incorporated

into the contractual obligations undertaken by

the suppliers. Any infringement of such,

therefore, constitutes a breach, entailing the

consequences of law, including termination of

the contract or engagement and claims for

damages.

Within its Environmental Sustainability Policy,

the Group:

•is committed to respecting and protecting the

surrounding environment through the

responsible use of natural resources and

main energy carriers, reduction of polluting

and climate-changing emissions, careful

waste management and customer and

supplier awareness on environmental

sustainability 123 issues;

•to influencing its suppliers through the use of

environmental sustainability criteria within the

selection and management process, so as to

guide the chosen suppliers to act consistently

with the Group's environmental policy;

•to spreading awareness of and

communicating its environmental policy to its

stakeholders, in particular to employees,

customers and suppliers and to guaranteeing

the update of the Group’s strategy and

objectives in connection with environmental

and sustainability topics.

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2022 ANNUAL FINANCIAL REPORT

Within the supplier screening process, selection

is based on multiple criteria, including, for

example, the technical suitability of the

products or services proposed, their quality, the

economics of the offer and the sustainable

commitment in social and environmental terms.

With specific reference to paper suppliers, a

category that is particularly important for

Mondadori due to the very nature of the

business, their selection and assessment is

based not only on economic factors but also on

the presence of certifications in accordance

with international PEFC/FSC standards aimed at

safeguarding and ensuring the proper

management of forest ecosystems.

The other main types of supply on the basis of

the criteria of economics and strategic

relevance for the Group are tied to printing and

logistics. Considering the main suppliers of

paper, printing, logistics and central purchasing,

90% of spending can effectively be attributed

to Italian suppliers, while the remaining 10%

comes from foreign purchases, even if

operating in Europe. In organisational terms,

the supply chain is managed for matters

relating to the purchase of paper, printing and

logistics services by the dedicated structures

within the Books division, whilst the Group

Services Procurement and Real Estate

Department within the HR and Organisation

Department, manages procurement of the

various goods for the whole Group.

2.2.1 Combating corruption

Within the management and control system of

the Mondadori Group, the Organizational,

Management and Control Model and the rules

of conduct of the Model - in the various

versions prepared for each company and all

constantly updated - represent a reasonably

effective system for guaranteeing business

integrity and the fight against corruption in all

the businesses and areas of the Group.

The project on the adoption of an Anti-

Corruption Policy and Compliance Programme,

in compliance with current legislation, was

entrusted to the Internal Audit and Internal

Control Departments and will be completed by

2023.

In the three-year period 2020-2022, no cases

of corruption or bribery involving employees or

suppliers in Italy were found to have occurred,

and no legal action was initiated or completed

against the Group or its employees for alleged

corruption. No reports within the

whistleblowing system were made in 2022.

2.2.2 Market abuse

Following adaptations of the Procedure on

inside information made in 2016 and 2019 in

compliance with Regulation (EU) no. 596/2014

on Market Abuse Regulation, the Mondadori

Group has strengthened its control over the

way it oversees, manages and circulates

corporate documents and information

internally, the way it communicates inside

information to the market and the public in

accordance with the applicable provisions of

law and regulations, and the audits on the

information.

The control system was complemented by the

internal dealing procedure as regards the

disclosure obligations towards CONSOB, the

Company itself and the market of all the

transactions of an amount equal to or higher

than € 20,000 (including all subsequent

transactions, carried out on financial

instruments issued by the Company, regardless

of the amount, once a total amount of € 20,000

has been reached in the course of a calendar

year), on derivatives and related financial

instruments by members of Mondadori's

governing or supervisory bodies, managers

who have regular access to inside information

and who are empowered to take decisions that

may affect the outlook and prospects of the

Mondadori Group and persons closely

associated with them.

In 2020, the notion of Specific Relevant

Information was integrated into the procedure,

with the following creation of the Relevant

Information List and definition of the relating

management criteria. Roles and responsibilities

relating to the inside information management

process were reviewed, also assigning the role

of FGIP (Inside Information Management

Function) to the Group CFO. Training programs,

under the responsibility of Mondadori, were

also delivered to the owners of the process.

The year 2021 saw a further optimization of the

methods for recording and tracing disclosure

items related to delay of disclosure of inside

information as per Article 17 of EU Regulation

596/2014.

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Consolidated non-financial statement

In the three-year period 2020-2022, no legal

actions were initiated against the Mondadori

Group for anti-competitive behaviour, violations

of antitrust regulations or monopoly practices.

2.2.3 Compliance

The Mondadori Group carries on business in

compliance with all applicable laws and

regulations. However, in the performance of its

activities, contestable cases may arise for

various reasons.

Specifically, typical of publishing activities are

the risks associated with the libel offence, as

these are risks inherent in the drafting of books

and/or articles. Libel consists, in fact, in

offending the reputation of others. The idea

each one of us has of the events and

circumstances of a particular case is subjective,

so the concept of "offensive" may vary from

person to person.

That said, the Mondadori Group performs

stringent audits before publishing books and/or

articles; nevertheless, disputes and libel suits

are bound to materialize.

The monetary value of the significant sanctions

(in excess of € 10,000) paid in 2022 for cases

of non-compliance with the law and regulations

comes to approximately € 117,000, of which

approximately 11,000 relating to tax penalties.

This figure refers to a total of 4 sanctions, 3 of

which applied in 2022 and one during a

previous reporting period.

In order to provide greater transparency to

stakeholders, the Company set up a filing

system for non-monetary penalties at the

beginning of 2012. Examples of non-monetary

penalties include the publication of rulings.

Only one case of a non-monetary sanction was

reported in 2022.

2.2.4 Privacy and data protection

Privacy and personal data protection are

fundamental elements for the Mondadori Group

as a whole, in which each company is

committed to ensuring that the collection and

processing of personal data is performed in

accordance with the principles and applicable

laws.

In pursuing its business, the Mondadori Group

can take pride in having a well-established

system aimed at protecting personal data,

which guarantees compliance with Regulation

(EU) 2016/679 ("GDPR"), Legislative Decree

196/03 ("Privacy Code") as subsequently

updated by Legislative Decree 101/2018, and

with the indications and provisions issued by

the Data Protection Authority.

Specifically, within the Group, personal data

management policies are governed by a series

of procedures in the areas of data retention,

privacy by design and by default, data

protection impact assessment, data breach,

feedback to data subjects and the appointment

of data processors pursuant to and for the

purposes of Article 28 of the GDPR. The Group

also has a Data Protection Officer in place.

The websites of each Mondadori Group

company all have privacy and cookie policies

available for consultation, which are kept

constantly updated. The Group’s corporate

website also features a section that illustrates

the personal data management policies

implemented by the entire Mondadori Group.

In 2022, the Group handled numerous requests

for the exercise of rights by data subjects,

including, in particular, requests for access to

and the deletion of personal data. No personal

data violations that could be considered data

breaches were reported.


Reclami per violazione della privacy/perdite o furti di dati dei clienti	2022	2021	2020

Substantiated complaints received regarding breaches of customer privacy (no.)	—	1	2
of which, from supervisory bodies	—	—	1

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2022 ANNUAL FINANCIAL REPORT


of which, received from external parties	—	1	1
Losses or theft of customer data (no.)	—	—	—

2.2.5 Tax policy

With regard to the national tax consolidation

scheme, in 2022 the Mondadori Group

renewed the agreement with Fininvest S.p.A.

(the Consolidating Company) for three years

(2022-2024), containing a protection clause

under which Arnoldo Mondadori Editore S.p.A.

and its subsidiaries participating in the tax

consolidation shall not be required to pay more

income tax than the Group would have paid if

Arnoldo Mondadori Editore S.p.A. and its

subsidiaries had created its own tax

consolidation agreement.

Income tax (both current and deferred) is

calculated based on the applicable rates in

each individual country in which the Group

operates, according to a prudent interpretation

of currently applicable tax laws.


Tax	2022		2021
(Euro/thousands)	Italy	USA	Italy	USA

Revenue from sales to third parties	855,328	47,675	761,870	45,475
Revenue fromintercompany transactions with other tax jurisdictions	761	739	1,065	1,377
Pre-tax profit/loss	64,247	2,609	34,437	4,129
Tangible assets other that cash and cash equivalents	22,791	1,343	13,243	1,371
Corporate income tax paid on a cash basis	20,325	1,299	12,997	947
Corporate income tax on profit/loss	19,453	1,038	15,504	1,162

2.2.6 Editorial independence

The Parent Company Arnoldo Mondadori

Editore S.p.A. is listed on the Milan Stock

Exchange.

The share capital at 31 December 2022, fully

subscribed and paid up, amounted to €

67,979,168.40, divided into 261,458,340

ordinary shares with a par value of € 0.26 each.

The majority shareholder is the holding

company Fininvest S.p.A., owned by the

Berlusconi family.

Significant shareholders as at December 2022


Shareholder	% interest in share capital at 31/12/2022

Fininvest S.p.A.	53.30%
Treasury shares	0.40%
Free float	46.30%

During the reporting period, the Mondadori

Group received financial contributions from the

public administration in Italy for a monetary

value of approximately € 8.41 million, of which

€ 6.38 million to Electa from the Ministry of

Culture in accordance with Decree no. 506 of

31 May 2021 of the DG-MU (Director General of

Museums). In 2022, the companies Mondadori

Media and Mondadori Scienza benefited from

contributions for paper respectively in the

amount of € 1.9 million and € 221 thousand.

Arnoldo Mondadori S.p.A instead received

approximately € 70 thousand in the form of tax

credits linked to “caro energia” and the

innovation fund; the latter was also received by

127

Consolidated non-financial statement

Mondadori Education and Rizzoli Education for

a figure of approximately € 7,000 each. Finally,

€ 114 thousand in COVID-19 subsidies were

disbursed by the US government for Rizzoli

Bookstore.

A breakdown is provided below of the last two

years by geographical area.


Grants received from Public Admnistration (Euro)	2022	2021

Italy	8,415,363.58	7,355,764.80
USA Rizzoli International Publications[1]	114,511.40	158,339.20
Total (Italy and USA)	8,529,874.98	7,514,104.00
[1] Amounts expressed in Euro (€), converted from USD at the exchange rate at the end of the relevant reporting period

Lastly, the Mondadori Group did not make

donations of any kind to political parties or

politicians during the year.

2.2.7 Intellectual property and

The Group's commitment to protecting the

rights associated with intangible assets

resulting from creativeness and inventiveness

is enshrined in the Company's Code of Ethics,

as the cornerstone of publishing activities.

April 1941.

The recent years, however, have seen a heated

debate pitting traditional content producers

against the new web players who use this

content. Against this backdrop, the Group

collaborates with national and international

trade associations (FIEG - Federazione Italiana

Editori Giornali, AIE - Associazione Italiana

Editori, and EMMA - European Magazine Media

Association) in order to effectively transpose

the European Directive on Copyright in the

Digital Single Market (Directive 2019/790) into

the Italian system, where in Legislative Decree

no. 177 of 08 November 2021 it has found its

most effective application.

In 2022, in light of the continuous evolution of

current regulatory obligations, the following

activities have been implemented to strengthen

the programmes aimed at protecting

intellectual property and copyright:

•adjustment, where necessary, of the

provisions of contracts to the adoption of the

provisions introduced by Italian Legislative

Decree no. 177 of 8 November 2021,

incorporating the European Directive on

•adoption of monitoring programmes to

monitor and prevent on-line piracy and the

unlawful use of information protected by

Just like in 2022, these activities will also take

place in 2023.

2.3 MAIN NON-FINANCIAL RISKS

In 2022, as part of the Group's Risk

Assessment activities, an exhaustive and

systematic analysis of the risks associated with

the social and environmental effects of

company activities continued, also in order to

meet the requirements of Legislative Decree

254/2016 and feed the path of constant

improvement in the field of sustainability.

These risks are the result of an integration of

the non-financial risks already covered by the

Group Risk Assessment process and specific

in-depth discussions. For further information on

mitigation actions, reference should be made to

the section Internal control and risk

management system (see 2022 Annual Report).

The effects of the conflict still ongoing, coupled

with the evolution of the COVID-19 pandemic,

have resulted in a substantial review of the

mapping of risks and a major review of the

strategic action taken to date, in order to

reduce the extent of the risks and ensure

business continuity.

In 2022, which was marked by the problems

described above, the main risks highlighted

regarded:

•the worsening of problems linked with

commodities, mainly paper, energy and gas,

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2022 ANNUAL FINANCIAL REPORT

both in terms of procurement and the

increase in the relevant costs, including

transport;

•in education, the demographic decline,

worsened with the uncertainty and economic

difficulties;

•the incidence of the on-line market, with

possible fallout, particularly by Amazon, not

only on distribution but also on the publishing

side.

The main considerations related to the risks

associated with the areas of reference outlined

in Legislative Decree 254/2016 are shown

below, also in light of the priorities defined by

ESMA for the 2022 reporting year.

2.3.1 Risks associated with

environmental topics

Climate change is an important topic for all

industries; in publishing, the critical issues

relate to the greenhouse gas emissions linked

mainly to energy consumption, the production

cycle for paper products and transport.

Growing concern on the part of stakeholders

and institutions over climate change could lead

to adjustments, in the future, to current

legislative provisions.

Alongside the risks associated with climate-

changing emissions are the risks associated

with energy efficiency, coupled with those

associated with potential interruptions in paper

supply.

Last but not least, it should also be noted that

social and environmental performance is

becoming increasingly relevant in assessing

the Company's suppliers.


Main risks	Main mitigation measures
Growing pressure from stakeholders and national and international institutions with regard to climate change.	Constant oversight of the issue through continuous monitoring of overall greenhouse gas emissions produced by the various operations of the Group (such as product distribution and logistics and business travel) and the identification of effective actions for their reduction.
Loss of opportunities for economic benefits due to reduced effectiveness of energy efficiency measures.	Constant oversight of the issue through continuous monitoring of overall energy consumption, strong focus on the upgrading of IT equipment and identification of energy efficiency measures in workplaces.
Interruptions in the production process due to the shortage of paper as a raw material.	Gradual extension across the Group of the use of FSC and PEFC certified paper.

2.3.2 Risks associated with social

topics and respect for human rights

The topic of human rights is closely tied to the

publishing sector, both as regards freedom of

expression and privacy protection and in the

social environment, such as media literacy and

product accessibility, for example.

And the role played by the operators that are a

part of it in promoting and spreading culture, is

all too clear.

The risks that ensue can stem from both

behaviour implemented by the Group and

external causes. In such situations, it will be

extremely important to monitor the risks linked

to personal freedom, well-being, educational

prospects and wealth of the younger

generations.

129

Consolidated non-financial statement


Main risks	Main mitigation measures
Critical issues related to potential restrictions on the freedom of expression of authors.	Continuous monitoring of the variety of titles published.
Critical issues related to the publication of editorial content considered sensitive, the loss of customer data and changes in the relevant legislation (GDPR, e- privacy, etc.).	Constant monitoring of sensitive data management practices and continuous improvement through the development of specific initiatives across the various company functions and the various Group companies.
The on-line channel, which was privileged throughout the pandemic, has resulted in a huge change in how consumers purchase books. To this end, e-commerce must be constantly developed in order to be competitive on the market and enhance the customer purchasing experience.	The on-line channel needs to be developed in order to increase competitiveness on the market and enhance the customer purchasing experience, through a greater integration towards “phygital” space (activities seeking to enrich the customer’s physical experience through the implementation of digital functions), the improvement of the customer experience and the continuous mapping of the market in order to enrich the payment card systems (Scalapay).
Growing pressure from the public to distribute quality publications, which are impartial and respectful of diversity.	Continuous improvement in editorial content and product quality.
Changing demands from the audience as regards tools for accessing editorial content.	Monitoring of the accessibility demands of the audience and the ability of the company to respond to such needs.
Critical situations connected with the inability of readers to distinguish the value of products sold, where suitable instruments are not provided to facilitate a fair understanding of mass media.	Continuous improvement in initiatives to raise awareness and educate the public as to the need to critically assess and analyse media.
Critical issues related to a potential increase in competitive pressures in relevant markets, which could lead to unfair conduct by competitors.	Constant oversight of the issue through specific training for internal personnel and networking activities with trade associations.

2.3.3 Risks associated with the fight

against corruption and bribery

Corruption, active and passive, is still a very

significant phenomenon and actions aimed at

combating it see national and supranational

institutions and bodies engaged in the front

line.

The Group is committed to acting responsibly,

not simply complying with all national and

international laws but also constantly promoting

ethical and transparent behaviour to strengthen

reputation in respect of stakeholders and

increase their faith.

For the Mondadori Group, the ways to address

the risks associated with the infringement of

internal rules and relevant laws in force remain

a priority concern.

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2022 ANNUAL FINANCIAL REPORT


Main risks	Main mitigation measures
Critical issues related to conduct infringing the laws in force by those who act in the name or on account of the Group.	Constant oversight of the issue through organizational measures and controls to help ensure and spread proper conduct (personnel training, selection of non- publishing products bundled with the publications, monitoring of the legal framework, networking with other companies in the sector). Adoption of the whistleblowing procedure, with the relating implementation of an IT system managed externally (to guarantee violator and whistleblower privacy) as a communications channel to handle reporting; amendment of model 231 of the Parent Company and its subsidiaries; employee training plan. Drafting of a specific anti-corruption procedure following a specific risk assessment.

2.3.4 Risks associated with personnel

management

The success of the Mondadori Group is built

squarely on the shoulders of the people who

act in its name or on its account. Their skills and

motivation are fundamental factors in the

development of innovative solutions able to

correctly interpret changes in relevant markets

and in society, which are necessary to

guarantee the financial performance of the

Group and its competitive standing.

The Mondadori Group continues to be

committed to establishing concrete dialogue

with its people, to encourage a greater

understanding of our respective needs and to

find solutions to any issues that may exist.


Main risks	Main mitigation measures
Risk that a more dynamic jobs market, coupled with technological change and alterations to the competitive scenario, may make it harder to retain people and attract new talent.	Continuous improvement in human resources management practices, in terms of negotiation, career management support, training, retention and job rotation policies.

2.3.5Risks associated with Diversity

& Inclusion

The Mondadori Group has supported and

promoted constant dialogue on matters of

diversity and inclusion for some time now.

These reference values aim to build trust and

collaboration with all stakeholders, such as, for

example, customers, employees, market and

communities, aligning with the market, which is

increasingly brand diversity oriented.

The other points of attention that have

emerged to date include growing awareness of

the role of D&I at all levels of company life and

compliance with current legislation.

The main mitigation measures involve:

•the half-yearly update of top management in

respect of the KPIs, which aim at “providing a

snapshot” of the application of D&I principles

as a starting point to define precise, targeted

actions;

•management incentives where effective

improvements are made (see 2. Governance,

Focus on the Sustainability Plan);

•targeted welfare projects and flexible internal

management policies, for example on

subjects like parental leave, salary parity and

intergenerational care giving;

•dedicated training courses, awareness-raising

campaigns and concrete projects to

communicate and promote;

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Consolidated non-financial statement

2.4 STRATEGIC BUSINESS

INNOVATION

From a strategic point of view, the Group has all

the managerial and financial resources required

to continue along the path of strengthening its

core businesses, and of rationalizing, if

possible, non-strategic activities consistently

and increasingly pursued in the last two years,

including through M&A operations.

Again in 2022, the Group continued to

consolidate its leadership in the Books Area.

With the acquisition of 50% of De Agostini Libri

S.r.l., a company specialised in trade books with

focus on the children's and non-fiction

segments, consistently with the strategy of

increased focus on its core business of books,

Mondadori has established a partnership with a

publisher that boasts a rich history and

tradition, as well as solid know-how. The scope

of the transaction also included Libromania

S.r.l., a company operating in the promotion of

third-party publishers. The acquisition of a 51%

stake in Edizioni Star Comics S.r.l., Italy's

leading comic books publisher, specialized in

the publication on the domestic market of the

major international productions including, in

particular, Japanese manga, also allowed the

Group to achieve a leadership position in the

domestic comic books segment.

It is recalled that late December 2021, the

Group completed the acquisition of 100% of De

Agostini Scuola S.p.A. through its subsidiary

Mondadori Libri S.p.A., achieving a leadership

position in the school textbooks publishing

market. The company D Scuola has been

included in the consolidation since 1 January

2022.

2.4.1 Enhancement and reputation of

brands and publishing trademarks

Management of the brands and publishing

brands goes beyond the concept of protecting

the Company's intangible assets, clearly

without neglecting this but in actual fact

seeking to explore their further potential and

linking this to action taken to increase the

accessibility of products and services.

The various initiatives described in this report

include in particular the events promoted by

the Group's brands which, during 2022, sought

to conjugate brand reputation and solidarity:

•Dalla parte della natura (On the side of

nature): in January Focus published a special

issue of the monthly magazine in

collaboration with the WWF, featuring a

disclosure project to strengthen the

commitment to safeguarding the Planet and

protecting species at risk of extinction, telling

the tales of the projects that the association

has been pursuing for 60 years;

•Focus For Future: always our brand leader in

scientific popularisation, with a view to

becoming the reference multimedia platform

on the environment and sustainability, it has

enriched its offer of contents and initiatives to

sensitise and proactively involve its

community on the territory, for example

becoming media partner of the national

“Plastic Free” initiative of 5 June;

•Incarta un libro, regala un futuro (wrap a

book, give a future): in the month of

December, with a donation, the Christmas

gifts were wrapped by the more than 100

volunteers present in the 64 Mondadori

bookstores adhering to the initiative, thereby

supporting the idea of Oxfam and Mondadori

Store to guarantee inclusive education for

children and teenagers in difficult social

contexts. 2022 activities raised funds in

excess of € 112 thousand, a concrete

commitment to help and support the more

fragile students.

•Well-being of body and mind, together with

the promotion of a more sustainable lifestyle,

starred in the editorial initiative “Cucina a

colori” organised by Mondadori Store: a

volume containing more than 180 recipes

featured alongside advice, news and

information to raise awareness about the

relationship between a healthy, balanced diet

and respect for the environment, with an eye

on consumption and savings. The book,

published by Mondadori Electa and available

only in our stores, proposes fun, colourful

cooking, playing on the chromatic harmony

gifted us by nature.

•Mondadori Store has also adhered to and

supported the “Bee Good” initiative: a project

promoted by Payback, which has given

members of the loyalty programme the

possibility of converting promotion points into

a payment of bees to be saved. A

contribution that made it possible to adopt a

total of 3 million bees, protecting the

biodiversity of the territory.

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2022 ANNUAL FINANCIAL REPORT

•Mondadori Retail has pursued and driven

“Percorsi”, the free training project dedicated

to our network booksellers. Created in

October 2021, it takes the form of a series of

meetings with the aim of providing stimuli,

tools and support to booksellers in managing

a store, bringing about a reflection on the

importance of their role in the relationship

with the product and customer. The second

edition appointments have been dedicated to

the following topics: analyses of the junior

publishing market, sales arguments and

objection management, visual merchandising

and social tool management.

•In June, to mark the FuoriSalone 2022, the

magazine Interni organised the massive

show-event entitled “Design Re-Generation”.

Starting out from the concept of regeneration

understood as requalification, recovery and

rebirth, the installations of this edition were

devoted to important topics like the new look

of sustainability, nature in the city, artificial

intelligence for an innovative design and a

new future through a more aware design.

133

Consolidated non-financial statement

3. SOCIAL

Enhancing people, content and places for education and

culture

The enhancement and management of human

capital are priority issues for the Mondadori

Group, which promotes the development of its

people in line with the company's prospects,

encouraging their growth in terms of new skills,

through the creation of quality training and

professional development programs consistent

with industry trends. In this context, the Group

promotes the well-being and a work-life

balance of its employees, also through specific

initiatives linked to welfare, prevention and

health (see the paragraph entitled “Health and

safety in the workplace”).

The company has always been committed to

valuing diversity and equity as levers for the

creation of a workplace that values uniqueness,

including through an evolved inclusive

leadership model.

This translates into multiple actions, conceived

consistently with the objectives defined in the

Sustainability Plan, for all Group employees and

collaborators.

The dissemination of culture and ideas is a

cornerstone of the Mondadori mission; it is not

only the basis of the company's business

activity, but also a distinctive feature of its

strategic approach to Sustainability and the

creation of its products for the public.

The Group is committed to ensuring that its

editorial products - books, school books,

magazines, websites and digital products -

contain content that is accurate, meticulous,

truthful and respectful of the tastes and

sensitivity of the public, through ongoing

editorial audits.

The Group's commitment to protecting the

rights associated with intangible assets

resulting from creativeness and inventiveness

is enshrined in the Company's Code of Ethics,

as the cornerstone of publishing activities. In

the context of the school product range, this

commitment becomes a true mission at the

service of the younger generations.

Attention to the context, ability to adapt and

responsiveness are the elements that have

always marked the work of the Mondadori

Group. Specifically, the company pays great

attention to assessing the perspectives and

opinions of teachers and students. It also

operates in the educational world defined by

national authorities in line with the best industry

practices and with a view to developing quality

products. Through innovative teaching contents

and dedicated in-depth analyses, the Group is

committed to promoting education for

sustainable development with particular regard

to the 2030 Agenda and environmental culture,

in line with the objectives set in the

Sustainability Plan.

This commitment is limited not only to schools:

through books, magazines, digital brands,

initiatives, bookshops and social channels, the

Group pays attention to sustainability topics in

its educational and information products, with

the aim of fostering knowledge and debate on

how to promote a more sustainable present

and future.

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2022 ANNUAL FINANCIAL REPORT

The Mondadori Group’s approach to the future in the field of

sustainability is laid out consistently with the four strategic guidelines

defined in the Sustainability Plan (see paragraph 1.1) with the following

future objectives connected with the Sustainable Development Goals

(SDGs) laid down in the 2030 Agenda.

The objectives achieved or started in 2022 are described in the next

few paragraphs.


FOCUS	1. Development and endorsement of a well-structured framework of KPIs for monitoring all D&I-related actions, with specific regard to the gender pay gap and gender balance.	2022
	2. Development of the hybrid working project for the joint definition of a new mixed working model.	2022
	3. Extension to 100% of the school offer of contents/insights in Sustainability, 2030 Agenda for Sustainable Development, diversity, equity and inclusion and civic education.	2023/ continuous
	4. A growing number of initiatives/services to promote reading. Maintenance of the offer of events during the next three years (Educational area).	2022/ continuous
	5. Strengthening of ESG training for the Group’s school publications and those for teachers. Maintenance of the offer of training during the next three years.	2022/ continuous
	6. Review of the internal procedures governing selection, hiring and career development with particular attention to D&I matters.	by 2023
	7. Development and implementation of a training plan specifically for D&I for all Mondadori Group people. [Ref. Governance]	by 2023
	8. Launch of the "Parenthood" project to promote more inclusive models for access to motherhood/fatherhood, removing existing biases and facilitating the return to work by enhancing acquired skills;	by 2023
	9. Obtaining certification of the management system in the D&I area.	by 2024
	10. “Care” project for all Group people and their families.	by 2024

3.1 Enhancement and management

of human capital

The valuation and management of the human

capital have for years been priorities for the

Mondadori Group. The risk analysis on such

topics also places emphasis on the need to

evolve personnel in line with the Company's

development prospects, encouraging their

growth in terms of new skills.

Therefore, alongside initiatives for improving

the quality of working life and for promoting

work-life balance opportunities, in 2022 the

Group renewed commitment towards creating

a training offer dedicated to digitisation and

professional development consistent with the

evolution of its business.

3.1.1 The people of the Mondadori

Group

At 31 December 2022, the Mondadori Group

had 1,900 employees in Italy and the US,

showing growth compared to 2021 in respect of

the new companies that joined the Group

during the year (De Agostini Libri, Libromania, D

Scuola and Star Comics for a total of 170

employees).

135

Consolidated non-financial statement

Mondadori Group employees, by geographical area (no.)


Geographical area	at December 31, 2022	at December 31, 2021	at December 31, 2020

Italy	1,849	1,763	1,798
USA	51	47	47

Total	1,900	1,810	1,845
For 2020, in addition to the number of employees specified in the table, another 2 people of the company Abscondita S.r.l. should also be considered part of the workforce, as the Group acquired the company in 2020 and it is not included in the 2020 NFS reporting scope. Data relating to this company have been included starting with the 2021 reporting year.

Specifically, at 31 December 2022, the Group's workforce is 63% women and 37% men, with most of

the employees in the 30-50 age bracket and over 50.

Mondadori Group employees, by age bracket and gender (%)


Age group	at December 31, 2022			at December 31, 2021			at December 31, 2020
Age group	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men

< 30	4%	65%	35%	3%	60%	40%	3%	57%	43%
30-50	55%	64%	36%	55%	65%	35%	57%	64%	36%
> 50	41%	61%	39%	42%	62%	38%	40%	62%	38%

Total	100%	63%	37%	100%	64%	36%	100%	63%	37%

With regard to the businesses, the Books Area is the largest, with approximately 44% of the Group's

employees.

This is followed by Media, Retail and finally Corporate in terms of workforce size.

Mondadori Group employees, by business


Business	at December 31, 2022			at December 31, 2021			at December 31, 2020
Business	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men

Corporate	15%	56%	44%	17%	59%	41%	17%	56%	44%
Books	44%	68%	32%	35%	70%	30%	34%	70%	30%
Retail	17%	58%	42%	18%	58%	42%	19%	59%	41%
Media	24%	61%	39%	30%	63%	37%	30%	62%	38%

In keeping with previous years, also at 31 December 2022, the overwhelming majority of employees

are under permanent, full-time contracts.

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2022 ANNUAL FINANCIAL REPORT

Mondadori Group employees in Italy, by contract type and gender (%)


Type of contract	at December 31, 2022			at December 31, 2021			at December 31, 2020
Type of contract	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men

Permanent	99%	63%	37%	99,7%	64%	36%	99,6%	63%	37%
Fixed-term	1%	88%	12%	0,3%	100%	—%	0,4%	75%	25%


Type of contract	at December 31, 2022
Type of contract	Total	of whom Women	of whom Men
Permanent	1.833	1.156	677
Fixed-term	16	14	2

Mondadori Group employees USA, by contract type and gender (%)


Type of contract	at December 31, 2022			at December 31, 2021			at December 31, 2020
Type of contract	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men

Permanent	82%	52%	48%	85%	52%	48%	89%	52%	48%
Fixed-term	18%	67%	33%	15%	57%	43%	11%	60%	40%


Type of contract	at December 31, 2022
Type of contract	Total	of which Women	of which Men
Permanent	42	22	20
Fixed-term	9	6	3

Mondadori Group employees, by professional type (full time/part time, %)


Type of contract	at December 31, 2022			at December 31, 2021			at December 31, 2020
Type of contract	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men
Full time	89%	61%	39%	89%	61%	39%	89%	60%	40%
Part time	11%	85%	15%	11%	83%	17%	11%	85%	15%


Type of contract	at December 31, 2022
Type of contract	Total	of which Women	of which Men
Full time	1700	1029	671
Part time	200	169	31

The three-year period 2020-2022 sees a trend of gradual growth in the percentage of women

executives compared to the total category, although still in the minority of the total.

137

Consolidated non-financial statement

Mondadori Group employees in Italy, by professional grading and gender (%, Italy)


Professional Grading	at December 31, 2022			at December 31, 2021			at December 31, 2020
Professional Grading	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men

Executives	5%	36%	64%	5%	31%	69%	5%	29%	71%
Middle managers	14%	51%	49%	14%	55%	45%	14%	55%	45%
Office workers	74%	68%	32%	71%	67%	33%	71%	66%	34%
Journalists	6%	66%	34%	9%	73%	27%	9%	73%	27%
Blue collars	1%	29%	71%	1%	29%	71%	1%	20%	80%

Mondadori Group employees in Italy, by professional grading and age bracket (%, Italy)


Profession al Grading	at December 31, 2022				at December 31, 2021				at December 31, 2020
Profession al Grading	Total	Of which <30 years old	Of which 30-50 years old	Of which >50 years old	Total	Of which <30 years old	Of which 30-50 years old	Of which >50 years old	Total	Of which <30 years old	Of which 30-50 years old	Of which >50 years old

Executives	5%	—%	36%	64%	5%	—%	40%	60%	5%	—%	45%	55%
Middle managers	14%	—%	48%	52%	14%	—%	50%	50%	14%	0,4%	54%	46%
Office workers	74%	5%	60%	35%	71%	5%	61%	34%	71%	3%	63%	33%
Journalists	6%	—%	23%	77%	9%	—%	27%	73%	9%	—%	35%	65%
Blue collars	1%	—%	57%	43%	1%	—%	29%	71%	1%	—%	40%	60%

Mondadori Group employees USA, by professional grading and gender (%, USA)


Professional Grading	at December 31, 2022			at December 31, 2021			at December 31, 2020
Professional Grading	Total	of which Women	of which Men	Total	of which Women	of which Men	Total	of which Women	of which Men

Executives	6%	33%	67%	6%	33%	67%	6%	33%	67%
Office workers	94%	56%	44%	94%	55%	45%	94%	55%	45%

Mondadori Group employees USA, by professional grading and gender bracket (%, USA)


Profession al Grading	at December 31, 2022				at December 31, 2021				at December 31, 2020
Profession al Grading	Total	Of which <30 years old	Of which 30-50 years old	Of which >50 years old	Total	Of which <30 years old	Of which 30-50 years old	Of which >50 years old	Total	Of which <30 years old	Of which 30-50 years old	Of which >50 years old

Executives	6%	—%	—%	100%	6%	—%	—%	100%	6%	—%	—%	100%
Office workers	94%	17%	35%	48%	94%	14%	36%	50%	94%	16%	34%	50%

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2022 ANNUAL FINANCIAL REPORT


Hires and terminations in Italy, by gender and age (No.,%)		2022		2021		2020
Gender	Age	Number	%	Number	%	Number	%
HIRES
Woman	< 30 years old	39	26%	22	30%	12	28%
	30-50 years old	60	40%	21	29%	15	35%
	> 50 years old	10	7%	1	1%	1	2%
Total women		109	73%	44	60%	28	65%
Men	< 30 years old	12	8%	10	13%	5	12%
	30-50 years old	23	15%	18	24%	9	21%
	> 50 years old	5	3%	2	3%	1	2%
Total men		40	27%	30	40%	15	35%
Total hires		149		74		43
Turnover rate (new employees)			8%		4%		2%
TERMINATIONS (3)
Woman	< 30 years old	16	7%	4	4%	6	3%
	30-50 years old	53	23%	25	22%	48	23%
	> 50 years old	90	39%	27	24%	51	25%
Total women		159	69%	56	50%	105	50%
Men	< 30 years old	7	3%	4	4%	0	0%
	30-50 years old	24	10%	25	22%	31	15%
	> 50 years old	39	17%	27	24%	72	35%
Total men		70	31%	56	50%	103	50%
Total terminations		229		112		208
Turnover rate (leaving employees)			12%		6.35%		11.57%
[3] The number of terminations does not include any employees seconded to other companies not part of the Group. As this is a secondment with a clearing entry for costs, these employees are not included in the total headcount at 31 December.

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Consolidated non-financial statement


Hires and terminations in the United States, by gender and age (No.,%)		2022		2021		2020
Gender	Age	Number	%	Number	%	Number	%
HIRES
Woman	< 30 years old	5	63%	3	43%	2	29%
	30-50 years old	0	—%	1	14%	0	0%
	> 50 years old	0	—%	1	14%	0	0%
Total women		5	63%	5	71%	2	29%
Men	< 30 years old	1	13%	1	14%	3	43%
	30-50 years old	1	13%	1	14%	2	29%
	> 50 years old	1	13%	0	0%	0	0%
Total men		3	38%	2	29%	5	71%
Total hires		8		7		7
Turnover rate (new employees)			16%		14.89%		14.89%
TERMINATIONS
Woman	< 30 years old	2	50%	3	50%	2	14%
	30-50 years old	0	—%	1	17%	3	21%
	> 50 years old	0	—%	1	17%	0	0%
Total women		2	50%	5	83%	5	36%
Men	< 30 years old	0	—%	0	0%	4	29%
	30-50 years old	2	50%	1	17%	4	29%
	> 50 years old	0	—%	0	0%	1	7%
Total men		2	50%	1	17%	9	64%
Total hires		4		6		14
Turnover rate (new employees)			8%		12.77%		29.79%

In addition to data relating to employees, the

table below shows the average number of

temporary staff in Italy during the year, broken

down by business area. The number of

temporary workers is subject to seasonality,

particularly for bookstores in the pre-Christmas

period during new openings and trade show

events. For the Retail Area, the 2022 data show

a further upswing, continuing on from 2021, in

activity versus 2020, which had been heavily

impacted by the COVID-19 pandemic. The U.S.-

based illustrated books publisher, Rizzoli

International Publications, does not employ

temporary or seasonal workers.

External workers (temporary) in Italy, by business area (no.)


Italy	2022	2021	2020
Temporary workers (no.)
Corporate	3	3	6
Books	6	18	21
Media	14	15	15
Retail	173	123	56
Total	196	159	98

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2022 ANNUAL FINANCIAL REPORT

3.1.2 Organizational developments and

industrial relations

In 2022, in terms of industrial relations, with the

end of the state of emergency, the

experimental agreement on smart working

applied, signed with the trade unions in July

2021. Almost all workers whose work was

considered compatible with the hybrid work

methodology, chose to adhere to this model. In

order to support those responsible in this

substantial cultural change and change in

paradigm of working methods, a change

management path has begun with the aim of

better structuring, in all Group signatory

companies, the new hybrid work model hinged

on flexibility, autonomy, responsibility and

collaboration.

At the same time, careful monitoring began of

the performance of experiments of the new

working model, which was constantly discussed

with the trade unions.

Amidst a context of complete consolidation of

industrial relations, in July 2022, the parties

agreed to extent the various institutes

envisaged by the Group's supplementary

agreement, along with the provisions relating to

productivity prizes, for the whole of 2023, so as

to guarantee application continuity.

In addition, throughout 2022, activities

focussed on extending the current treatments

in place in the Group to also include the

recently-acquired companies (D Scuola, De

Agostini Libri and Libromania), making it

possible to achieve almost complete

integration - in the company’s industrial

relations system - since 1 January 2023.

In December 2022, union agreements were

signed for all Group companies, both for the

graphic part and trade, aimed at presenting the

new training plan in order to qualify for the New

Skills Fund.

Management also drew to a close of the early

retirement program, launched in 2020, for

Arnoldo Mondadori Editore and Mondadori

Media.

To consolidate smart working initiatives, the

Flex-Ability project was launched with the aim

of jointly constructing the new way of working,

conciliating the concepts of productivity and

effectiveness with flexibility, well-being and

personal satisfaction, paying close attention to

inclusion. (see Training and Development);

Under the scope of this project, all employees

were assigned the technological equipment

(PC and smartphone) necessary to enable the

change.

All the employees in Italy are covered by

collective bargaining agreements: the Graphics

Publishing CBA (covering 76% of employees

and including Industry managers), the

Journalists CBA (6% of the corporate

population) and the Trade CBA (applied to 18%

of employees, including Trade managers). In

the United States, sectoral trade union

agreements are not as common as in Europe;

the general protection provided by federal laws

obviously applies to all workers.

The minimum notice periods required by the

applicable collective bargaining agreements

(30 days for Graphics-Publishing and 70 days

for Trade) were respected in all cases of the

transfer of business units and/or organizational

change, with negotiations launched several

months in advance.

3.1.3 Training and development

The international economic context and the

reference markets of the various business units

have maintained - and are expected to maintain

over the coming years - a characteristic of

speed of change that calls for a constant

evolution of the business models and new

product development.

Increasingly strategic competences to be able

to meet the new challenges quickly and

increase competitive advantage are the

capacity to intercept new areas of activity, to

innovate thanks to synergies between digital

and traditional products and skills to

communicate and dialogue with our readers

through social channels. 2022 training

programmes have been focussed on

strengthening these strategic competences for

the organisational development and business.

This is why the training process and

professional and managerial growth is

increasingly structured and aimed at the

specific needs for updating the various

professional skills present in the Group, also

becoming an element attracting young talent in

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Consolidated non-financial statement

an increasingly competitive employment

market. The inclusion of new figures

guarantees new skills and new approaches that

are useful to the company’s innovation.

In continuity with the training programmes

delivered in the previous year, in 2022, a plan

was developed aiming to consolidate the skills

sets that are essential to all professional

families in order to operate and contribute to

the development of the lines of the company

evolution.

The courses delivered also made it possible to

continue to bridge the gaps that have emerged

from the digital assessment performed at end

2020 with respect to the competences

necessary to address the digital transformation

process of businesses: the test helped

investigate each person's digital mindset and

skills in terms of basic digital literacy, ability to

use digital tools for work planning and

management.

The 2022 training plan, which consisted of a

total of over 35,000 hours of specialized and

managerial training, focused on the

implementation of specific training projects,

based on four main pillars and the following

areas.

1.Digital Adoption. In order to satisfy the need

for tools and specific abilities:

•to increase effectiveness and productivity at

work, like courses on Excel and Power Point;

•to facilitate the new hybrid work mode that

requires sharing and collaboration tools, like

the course on Gsuite;

•to execute the digital strategy like:

–courses on the programs Photoshop,

Illustrator and Adobe Premiere;

–courses to learn to create podcasts for a

new way of managing contents;

–courses to acquire competences to design

websites with a user experience hinged

on the characteristics of the user and with

contents that can engage them,

generating and transforming on-line visitor

traffic into loyal consumers.

2.Business Innovation. In order to pursue the

spread of a technological culture and digital

mindset to be able to develop a new

strategic vision of the business, cycles of

informative webinars have been developed,

in collaboration with the Polytechnic

University of Milan, on topics considered as

core to the evolution of Mondadori. The

meetings have made it possible to convey

knowledge, points for thought and scenario

visions linked to new technological and digital

opportunities to drive innovation.

To enable people and the organisation to

develop innovative ideas, a course has been

conceived on Design Thinking, which flanks

theoretical training on the design thinking

model with practical applications to generate

innovative ideas for Mondadori.

Multifunctional teams have worked on the

development of projects identified by the

management and, under the scope of a

specifically-created contest, the best

proposals have been selected by a panel and

will subsequently be implemented.

For Retail, two courses have been

developed, one for store managers and one

for store sales staff - to update skills in a

scenario that sees consumer behaviour and

purchasing methods of the new generations

change tremendously, heading towards a

hybrid retail model.

In the Commercial Area of the Trade Books

area, training has been delivered on

“MondadoriS People – Sales Innovation

Sprint”, dedicated to sales profiles and

intended to provide professional refresher

courses on the latest trends linked to digital

and innovation, which envisage a

transformation of the commercial figure, from

simple seller of a product to consultant to

improve the sale and relationship with the

end customer.

3.Digital Marketing&Content Management.

This area’s courses are intended in particular

for marketing and communication

professionals and those creating editorial

contents to develop skills in the following

areas: digital marketing platforms, web

analytics, Seo writing techniques, social

media content and digital advertising.

In 2022, the Group chose to consolidate the

new hybrid work mode to maintain the

positive changes made in the last two years,

which had yielded important results. The

new hybrid work methodology, defined as

Flex-Ability, is today characterised by a

widespread awareness and growing

acceptance of accountability of people and a

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2022 ANNUAL FINANCIAL REPORT

new managerial style characterised by

greater listening, delegation and organisation

and less control.

Some of the training programs developed in

2022 aimed to foster this cultural change to

facilitate and support the adoption of agile

models of work organization, including

remote work, capable of guaranteeing fully

satisfactory performance and results.

4.Agile Working&Organization. Interventions in

this area seek to satisfy the need for soft skills

and specific competences to support hybrid

work and develop new agile management

methods of processes and projects to

innovate managerial models and ensure

leadership styles that are increasingly

effective and consistent with the changing

environment.

In 2022 too, two training paths were

developed, “Remote people management"

and "Remote agile working”, each running

for 20 hours, to be able to reach and enable

the most extensive population bracket

possible. After having last year trained

approximately 150 managers and more than

300 Group employees, in 2022, another 40

managers and more than 170 employees took

part in these courses. In addition, for those

who had already taken part in the two

previous courses, two in-depth courses were

offered:

•Digital Smart Leader, focussing on certain

managerial skills that have become even

more important and complex in a hybrid work

model: conflict and team management with a

coaching approach, negotiation, emotional

intelligence and the capacity to provide

motivating feedback;

•Smartworking soft skills, aiming to develop

soft skills to be more efficient in a hybrid work

model, emotional abilities in relations,

efficient communication strategies,

awareness and responsibility for one’s role.

The Manager Flex-Ability course, adhered to

by more than 200 Group managers and divided

up into 9 transversal groups, proved to be

particularly valuable and high-impacting with

respect to the objective of changing the culture

and way of working.

This initiative was structured into 5 sessions in

a physical classroom and a virtual classroom

and aimed to create awareness about the

change management process launched by the

company and involve managers, engaging

them with respect to their role as change agent

insofar as they are people managers and

positive role models for the new conduct

describing the Flex-Ability principles.

The expected output was the participated,

shared definition of a new leadership style

suited to the new model based on coaching

and feedback and consistent with the new

values and the evolution of the Group’s

business. The course, which is still in an

experimental phase of the new hybrid model,

provided an important opportunity for reflection

and dialogue between managers about their

experience with the flexible working

procedures trialled over the last two years and

identify areas for consolidation and

improvement, in particular in relation to the

skills needed to manage the new way of

working with a focus on leadership and team

management.

The course also allowed for the development

of the competences needed to:

•guide the change of the new ways of working

with a focus on leadership and team

management;

•better engage with the new context with a

focus on communication, listening and

emotional intelligence;

•improve organisational efficiency with a focus

on the digital mindset and the capacity to

simplify working dynamics and methods.

The Group has also launched an important

cultural transformation process to make

Mondadori increasingly inclusive and careful

to enhance the unique aspects of each and

every person.

The concept of inclusion includes the

acknowledgement, understanding and

optimisation of diversity as a resource, as well

as its use in a positive manner, creating a fair,

welcoming physical and social environment.

Creating an inclusive working environment

means redesigning processes like recruiting

and talent management, introducing policies

designed to assure equal opportunities for all

workers. With this goal in mind, a pilot edition

has been developed for HR management of a

course that in 2023 will also be extended to

managers, to work on raising awareness and

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Consolidated non-financial statement

managing unconscious bias, acting on

behaviour to modify it to be more inclusive.

This year too, the courses were able to achieve

the cross-cutting objective of fostering

knowledge and integration of the various

company areas to improve efficiency and the

development of synergies and create practices

and a shared management style.

The managerial and specialist training is

complemented by language training (over

2,300 hours) delivered both in the traditional

one-to-one manner and in blended mode, i.e.

through the use of digital platforms. To

complete individual linguistic training,

interactive group workshops were developed

on specific managerial skills like public

speaking, business writing, effective delegation

and collaboration, pitches and presentations.

Lastly, complementing the programs,

workplace safety training, delivered both in

the classroom and via e-learning.

The following table shows the number of

training hours delivered and the number of

attendees in the three-year period 2020-2022

in Italy. In 2022, the total number of training

hours increased compared with 2020. The

value falls below that of last year due to the

exceptional number of hours delivered in 2021

thanks to the access given to major resources

of the New Skills Fund (FNC), to which the

Group had adhered significantly to address the

uncertainties caused by the pandemic.

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2022 ANNUAL FINANCIAL REPORT

Hours of training delivered in Italy and attendees (total, no.)


HOURS OF TRAINING (no.)	2022	2021	2020	Participants (n.)	2022	2021	2020

Total	42,441	144,931	11,185	Total	3,654	2,025	2,007

of which, ad hoc training	35,677	140,127	10,091	of which, ad hoc training	1,836	1,634	1,617
Executives	1,717	3,651	643	Executives	95	73	98
Middle managers	5,087	16,087	2,639	Middle managers	251	225	260
Office workers	23,599	105,381	6,574	Office workers	1,385	1,180	1,172
Journalists	5,271	14,926	213	Journalists	104	154	83
Blue collars	3	82	22	Blue collars	1	2	4
% hours delivered to women	63%	64%	68%	% women	64%	65%	65%
% hours delivered to men	37%	36%	32%	% men	36%	35%	35%

of which, language training	2,382	3,150	332	of which, language training	152	79	24
Executives	479	1,813	147	Executives	28	47	11
Middle managers	885	1,037	92	Middle managers	62	23	7
Office workers	277	221	68	Office workers	17	7	5
Journalists	741	79	25	Journalists	45	2	1
Blue collars	0	0	0	Blue collars	0	0	0
% hours delivered to women	63%	53%	72%	% women	59%	43%	58%
% hours delivered to men	37%	47%	28%	% men	41%	57%	42%

of which, safety training	4,383	1,654	763	of which, safety training	1,666	312	366
Executives	70	54	2	Executives	39	13	2
Middle managers	468	153	48	Middle managers	232	29	37
Office workers	3,653	1,395	676	Office workers	1,294	262	311
Journalists	186	28	28	Journalists	99	4	14
Blue collars	6	24	9	Blue collars	2	4	2
% hours delivered to women	64%	44%	52%	% women	65%	50%	56%
% hours delivered to men	36%	56%	48%	% men	35%	50%	44%

of which, safety training	42,441	144,930	11,185	Total attendees	3,654	2,025	2,006
Executives	2,266	5,519	736	Executives	162	133	111
Middle managers	6,439	17,277	2,778	Middle managers	545	277	304
Office workers	27,529	106,996	7,318	Office workers	2,696	1,449	1,488
Journalists	6,198	15,032	266	Journalists	248	160	97
Blue collars	9	106	31	Blue collars	3	6	6
% hours delivered to women	63%	63%	67%	% women	64%	62%	63%
% hours delivered to men	37%	37%	33%	% men	36%	38%	37%

In 2022, in particular, average training per capita in Italy stood at approximately 22.61 hours.

145

Consolidated non-financial statement

Average hours of training delivered in Italy (per capita, no.)


Detail	2022	2021	2020
Total	22.95	82.21	6.22
Women	23.00	81.31	6.56
Men	22.87	83.80	5.64
Executives	22.00	57.48	7.75
Middle managers	25.15	70.81	11.29
Office workers	20.15	85.26	5.70
Journalists	56.35	93.37	1.62
Blue collars	0.67	15.13	3.10

For Rizzoli International Publications, no

training hours were delivered in 2022.

Consequently, the number of training hours per

capita for the Group comes to 22.34, of which:

21.37 for managers, 25.15 for middle managers,

19.47 for office workers and 0.67 for manual

workers.

With regard to staff assessment and

development, activities carried out in 2022

include:

•Individual executive coaching courses,

lasting 6-8 months, to best support the

Group's managers in their professional

growth. Specifically, the aim was the

development of managerial skills considered

essential in today's organizational contexts: -

strategic vision;

–improved leadership;

–authority and assertiveness towards

assistants;

–coverage of their role and ability to take

on responsibilities;

–proactiveness and negotiation skills;

–improvement of the quality of

communication and interpersonal

relations;

–management of change and innovation;

–management of time and priorities;

–motivation of assistants;

–ability in giving constructive feedback;

The specific development goals covered by the

coaching program are defined with the

manager, consistent with the mission of the role

held and the manager's expectations for

growth. This managerial development leverage

introduced in 2021 and continued in 2022 is

just one of the responses to the needs that

have emerged from the assessments carried

out previously on all the management

population.

The activation of coaching courses has now

become a frequent practice to support

managers as they transition towards positions

of greater responsibility and complexity.

•Nudge Global Impact Challenge: the

Mondadori Group’s participation continued in

2022 too, in this initiative organised by the

Dutch company and involving more than 100

young talents from 35 different countries.

Through an internal selection process, three

under-33s were chosen from the Group as

being passionate about topics relating to

sustainability and the circular economy to

take part in the challenge. They were

involved in a path of 8 months of coaching,

workshops and seminars with high-profile

speakers and trainers from around the world

and from different areas, to allow attendees

to broaden their horizons and enrich

themselves through discussion and the

exchange of views with highly diverse

organizations.

The goal of the initiative is to develop the

leadership of young talents, so that they can

have an impact on changing business models

towards greater sustainability. The Nudge

Global Impact Challenge is based on

developing and implementing a corporate

impact plan that will have an impact in terms

of cultural and/or organizational change.

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2022 ANNUAL FINANCIAL REPORT

Development of plans to participate in the

challenge is ongoing and will be submitted by

April 2023.

In May 2022 Anna Spinelli, editor of Il Battello

a Vapore, was included amongst the six

finalists for the Nudge Global Impact Awards

2022 at Peace Palace in The Hague, the

Netherlands, being awarded the prize of best

project able to create the greatest sustainable

impact.

Conceived as a way of combating food waste,

it consisted of an anti-waste manual entitled

“Too Good To Go”, developed in

collaboration with the world’s number one

app against food waste.

•Parallel to that, awareness continued to be

raised of the know-how mapping campaign

professional experience that each employee

has gained in the Group or in other contexts

and educational backgrounds. The goal of the

initiative is to have a permanent tool for the

search, management and development of

talent in the Group, which will help manage

internal mobility processes, design

development paths, monitor any gaps,

support line managers in enhancing the value

of their assistants and accompany the people

of the Mondadori Group in their professional

growth. Each person has the ability to update

their data in the new Talent Management

module of HR Portal - "Careers and

Performance" section. Also in 2022, the data

collected was used to carry out analysis and

mapping of the population for purposes of

internal mobility, reorganization, or training

planning.

•The so-called corporate Job System was

completed, i.e. the mapping of " Professional

Families” "Sub-families" and "Roles" present

in the Mondadori Group and the "Job

Profile" (understood as the set of

responsibilities and the resulting technical

and soft skills needed to "act"), which was

updated in light of organizational changes.

Specifically, for each role, the associated

organizational positions were identified,

indicating, for each, the relating job

evaluation.

The creation of the Job System will allow for

a more effective management of people in all

phases of the employee life-cycle

(rationalization of job requisitions for the

profiling of positions to be sought; definition

of targeted development paths based on skill

upgrades; alignment of roles - job evaluation

to allow consistent and fair remuneration

policies; definition of ad hoc training paths to

fill the skill gaps required to cover the role).

The Job System was made available in 2022

to all professionals from the HR Department,

as support for recruiting processes to identify

job requisitions of vacancies during the start-

up of the search and selection and to manage

internal mobility processes.

•Team Effectiveness Project that involved the

first line managers of the Finance and Control

area. This department is managing a

significant change process, both within the

area and in support of the company’s

evolution and this has called for particularly

challenging behaviour. The aim of the project

was to provide the CFO with points for

thought to define a “development” plan

through which to further maximise his

contribution and that of the whole team. The

route structure involved collecting feedback

through structured interviews with all team

members so that they can make their own

constructive, propositional and open

contribution to the analysis of the team

dynamics and leadership style adopted in

managing the group and individuals.

Finally, as regards the transition assistance

programmes, the Group has envisaged:

•Outplacement: support for those leaving the

company thanks to collaboration with

accredited third parties. This is a programme

that usually runs for 12 months, during which a

team supports the outgoing worker in his

search for new opportunities and professional

placements. The team consists of a

consultant with experience in the same sector

of origin or functional area and a career

consultant, who is an expert in the

employment market: together, they strive to

help the outgoing employee address the

various aspects that feature in a career

transition. The path is structured into

moments of training and others where the

employment market is analysed, as well as

information about search activities, offering

opportunities for active dialogue on the

search and market feedback. When the path

is started, competences are assessed to

identify the individual characteristics, the

baggage of knowledge and the hard and soft,

technical and transversal managerial skills

147

Consolidated non-financial statement

and competences that a person has acquired

professionally and personally.

•Training vouchers for professional

requalification: in defining the leaving

incentive, a voucher may be included to be

spent on training delivered by third parties

outside the company, like business schools

and universities.

The value of the voucher is defined on the

basis of the worker’s specific needs and the

comprehensive composition of the incentive

at leaving. The HR Department offers support

in choosing the type of training on the basis

of an analysis of professional experience and

expectations for the future career

development and, after a careful assessment

of what the market has to offer, suggests

some possible choices.

•Internal professional requalification training:

during the run-up to leaving, those concerned

can independently choose, taking a self-

development approach, from a wide range of

courses available on the annual training

plans, opting for courses that may be useful

for reskilling in order to look for new

opportunities on the employment market.

•Early retirement plans: early retirement plans

in publishing houses consist of the possibility

- through the use of tools made available by

the law and in compliance with the directives

given by legislation - to access pensions

early, ahead of the ordinary pension

requirement, for employees with 35 years of

contributions paid.

The early retirement plan involves trade union

and ministerial agreements on the basis of

the mapping of potentially entitled people (i.e.

those who meet the legal requirements) and

is of voluntary access, as the employee,

where meeting the requirements, decides

whether or not to effectively opt for early

retirement.

3.1.4 Welfare and benefits

The company agreement covering employees

under the graphics publishing collective labour

contract signed in 2018 introduced effective

work-life balance tools, such as smart working,

which switched from the experimental stage in

2019 to the mainstream tool in 2022 too, and

measures to support households, with the aim

of providing more favourable conditions to

combine work and family needs. Special

attention was paid to maternity protection, with

the reduction of working hours in the six

months following return and the anticipation of

full pay for periods with reduced remuneration.

For new fathers, however, paid leave was

increased to 10 days. In cases of serious illness

too, the period of respite is suspended with a

view to job retention.

The agreement also provides for the

establishment of an annual variable

performance bonus common to all Group

companies, part of it made available through a

corporate welfare system that provides

employees with a series of services and

initiatives to facilitate the well-being of workers

and their family.

In 2022, additional possibilities were

introduced to allocate the available welfare

credit (such as, for example, the possibility of

obtaining a reimbursement for medical costs)

and the income support initiatives envisaged by

the Aid Decrees issued by the Government,

such as reimbursement of domestic utility bills

and a € 200 fuel voucher, have been made

available.

At 31 December 2021, 55% of employees were

entitled to receive the performance bonus

disbursed in May 2022. 53% of those entitled

converted the bonus into welfare (this

percentage also includes those who chose to

convert part of the bonus, not just those who

converted 100%) and 45% of the total

performance bonus was thus converted into

welfare.

Additional income support actions included the

disbursement of a gift voucher worth € 1,000 to

employees whose gross annual remuneration

falls within the bracket envisaged by the Aid

Quater Decree and the distribution to all

employees of a Christmas gift consisting of

numerous food items.

During the year, the main intervention

measures envisaged in the Home-Work Travel

Plan, were implemented (Law 77 of 17/07/2020)

with the aim of reducing the environmental

impact of vehicle traffic in urban and

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2022 ANNUAL FINANCIAL REPORT

metropolitan areas. In December, the Area

Mobility Manager of the Municipality of Segrate

was presented with the Home-Work Travel Plan

for 2023, which envisages additional mobility

measures.

3.1.5 Internal communications

Communication activities for employees and

associates of the Mondadori Group are key

aspects through which to involve all people in

company life and strengthen their sense of

belonging, as well as being functionally and

operatively useful. These actions and initiatives

fall within the competences of the

Communication and Media Relations

Department and, to a large extent, take place

on the Mondadori communication ecosystem

channels.

Under this scope, the current version of the

Mondadori Network, the service

communication platform for employees and

associates, plays a central role. Thanks to the

functions offered by Google Sites and, more

generally, by the Google tools used by the

Group to manage working activities, the

company intranet is also accessible from any

device and at any time. It also integrates

effortlessly with the tools of Google Suite, as

well as with the other company platforms,

collecting links and methods for accessing

useful systems for working life and corporate

communication channels. In thus doing,

Mondadori Network addresses the need to

constantly keep abreast of things, a need that

has materialized with greater strength with the

introduction of hybrid working.

To complete all contact points between the

company and its people, we have internal

digital signage, namely the programme of

communications to be broadcast on the screen

at the entrance to the headquarters. Through

the videowalls, every day employees and

associates in the office are directly and

promptly informed of all internal news and

initiatives.

The Intranet and e-mails to all employees in

Italy and around the world are the main tools

used by the CEO too to share and comment on

the Group’s performance and financial results.

This is not all: in a broader communication

perspective, which transcends the distinction

between external and internal communication,

the use of the Group’s social accounts in 2022

strengthened the narrative of the company and

its results.

In this sense, publication of posts on new

appointments and initiatives dedicated

specifically for employees and associates, such

as the projects of the Diversity & Inclusion

department or corporate welfare activities,

continued.

3.2 DIVERSITY, EQUITY AND

INCLUSION

Publishing has traditionally been an industry in

Italy with a heavy presence of women in the

general workforce. This presence, however, is

not always accompanied by true gender

equality in top positions and remuneration. In

May 2021, the Mondadori Group created the

Diversity & Inclusion department, appointing a

Chief Diversity Officer, with the aim of

enhancing diversity within the company and

significantly fostering inclusion processes.

Within the function, diversity is conceived in its

broadest sense, with priority focus for the

current year on aspects related to gender and

the coexistence of multiple generations in the

company. In 2022 too, the department worked

in synergy with all corporate departments,

promoting dialogue with the various businesses

to bring the various initiatives in progress or

developed on these topics to the system.

The main goals of the function are divided into

five main clusters listed below:

1.Implementation of the system of indicators

related to diversity and inclusion, which, by

monitoring gaps to be filled in a timely

manner and their development trends, has

made it possible to guide company priorities

and verify the effectiveness of actions

undertaken. More specifically, the top

management long-term incentive plan now

includes an ESG indicator to measure the

spread of the inclusive culture in the

company, the improvement of the gender

balance between female and male managers

and reduce the equal pay gap.

2.Continuation of the activities aiming to

promote the "cultural change" through

meetings aimed at the entire company

population and specific training for certain

segments of the population, to increase

employees' awareness of the issues in

question, as critical elements for the success

of their business and personal growth.

149

Consolidated non-financial statement

The main initiatives in this area were:

•two new webinars intended for all the

company population to promote a path of

dissemination of a corporate culture

hinged on D&I. Opportunities for meetings

and dialogue that saw the involvement of

important academic representatives,

including the professors Daniela Lucangeli

and Cecilia Robustelli, along with some of

the Group’s creators and authors. The

topics addressed during the meetings

include gender discrimination, ageism,

welcoming and inclusive language and the

possibility of expressing individualism in

social and organisational contexts;

•an in-depth survey on the care work that

involves all Group people, care in relations

with oneself, with children and parents

and with society, with the aim of obtaining

operative instructions on how to develop a

more extensive care plan to be launched

in 2023;

•workshops dedicated to the perception of

unconscious bias, using artificial

intelligence methods

3.Participation in some important national

round tables like that organised by the

Ministry for Equal Opportunities and Family -

under the Draghi Government - involving

some of the country’s most important

companies to share guidelines and best

practices, which then resulted in operative

suggestions for the institutions.

Internationally, participation in the permanent,

independent Observatory on gender equality

and women’s empowerment launched by The

European House-Ambrosetti in the G20

countries and in Spain, as a partnership with

some major international companies,

including Mondadori.

The study highlighted how the achievement of

gender equality and the progress of women's

empowerment is not merely a question of

rights, but also an essential step towards

achieving sustainable development in countries

in terms of social equality, economic growth

and competitiveness.

4.Continuation of the collaboration with the

Group brands and publishing houses in the

development of specific internal and external

initiatives aimed at making a tangible impact

on gender equality issues. These include the

“Stories of Afghanistan” report presented by

The Wom in 2022. It is a collection of

testimonials given by Afghan women who

have sought refuge in Italy, to sensitise

readers, as well as employees, to the

importance of respect for human rights, and

women's rights in particular, and the need to

work concretely and at all times to make

diversity and inclusion truly a constant of

being part of the Group.

5.Monitoring of the national legislative

framework in order to implement all

compliance actions in a timely manner, with

particular regard to obtaining the equality

certification currently under consideration by

Government.

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Ratio of basic salary of women to men by category4


Professional Grading	2022	2021	2020

Executives	63%	63%	65%
Middle managers	92%	92%	92%
Office workers	96%	98%	98%
Journalists	78%	82%	81%
Blue collars	80%	90%	81%
[4] The calculation of the basic salary ratio is based on the average annual gross salary. It is also noted that in order to calculate the ratio, the basic salary of employees classified professionally as “part-time” has been reproportioned so as to make it comparable with that of full-time employees. The values used to calculate the ratio do not take into account the remuneration of the Chief Executive Officer and the variable deriving from the LTI. We should also specify that two employees of Abscondita S.r.l. were excluded from the calculation. The calculation was performed on the Italian offices.

Ratio of the remuneration of women to men by category5


Professional Grading	2022	2021	2020

Executives	61%	61%	61%
Middle managers	89%	89%	88%
Office workers	95%	97%	95%
Journalists	76%	78%	76%
Blue collars	80%	89%	81%
[5] It should be noted that the remuneration takes into account, in addition to the average gross annual salary, only any MBO bonuses paid for specific employee classifications as at 31 December. Additionally, in order to calculate the ratio, employees falling in the "part-time" professional category have been brought back to “full time”. We should also specify that two employees of Abscondita S.r.l. were excluded from the calculation. The calculation was performed on the Italian offices.


Top positions in magazines	2022		2021
	Women	Men	Women	Men
Editors-in-Chief	40%	60%	25%	75%
Deputy Editors-in-Chief	25%	75%	57%	43%

Employees with disabilities (%)


Professional Grading	at December 31, 2022			at December 31, 2021			at December 31, 2020
Professional Grading	% of total employees with disabilities	of whom % Women	of whom % Men	% of total employees with disabilities	of whom % Women	of whom % Men	% of total employees with disabilities	of whom % Women	of whom % Men

Middle managers	6%	75%	25%	5%	75%	25%	5%	75%	25%
Office workers	87%	44%	66%	85%	47%	53%	84%	47%	53%
Journalists	—%	—%	—%	1%	100%	—%	4%	100%	—%
Blue collars	7%	20%	80%	8%	33%	67%	8%	33%	67%
	% of total employees	of whom % Women	of whom % Men	% of total employees	of whom % Women	of whom % Men	% of total employees	of whom % Women	of whom % Men
	3%	46%	54%	4%	48%	52%	4%	49%	51%

151

Consolidated non-financial statement

Almost 3% of employees (almost exclusively by women, 92%) took parental leave (a right that extends

to all the workforce, regardless of contract type). The data in the table refer to employees at the

offices in Italy and the United States.

Parental leave


Detail	2022			2021			2020
Detail	Women	Men	Total	Women	Men	Total	Women	Men	Total

Employees entitled to parental leave (no.)	1,198	702	1,900	1,152	658	1,810	1,163	682	1,845
Employees who took parental leave (no.)	51	6	57	27	2	29	38	13	51
Employees returning to work after parental leave (no.)	51	6	57	27	2	29	38	13	51
% returning after parental leave	100%	100%	100%	100%	100%	100%	100%	100%	100%
[6] For consistency with other workforce tables, data are shown at 31 December. As regards the employees that took parental leave, the total number includes those not appearing in end-of-year headcounts due to terminations/resignations.

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2022 ANNUAL FINANCIAL REPORT

3.3 HEALTH AND SAFETY IN THE

WORKPLACE

The main aim of the Mondadori Group

prevention and protection service has always

been to guarantee safety in the workplace and

safeguard the health of all workers.

In 2022 too, the activities aimed at countering

COVID-19 infection took on a key priority for

the Group Safety Coordination, a body set up

by the Parent Company in 2016 to coordinate

the planning and assessment of the ordinary

legal obligations under Legislative Decree

81/08 - Consolidated Law on Work Safety.

The various measures taken by the Mondadori

Group to combat the spread of the virus were

readily implemented through the ceaseless

work of the COVID-19 Crisis Committee, set up

from the onset of the emergency, and saw the

ongoing participation of the Employers, the

Head of the Prevention and Protection Service,

and the departments responsible for HR,

Procurement, Legal and Communications areas

of the Group, as well as the business areas. In

addition to monitoring the developments of the

emergency, the measures to guarantee the

safety and health of all workers were assessed,

defined and concurrently authorized, in

collaboration with the Coordinator of the

Competent Medical Officers, who played a

fundamental role in setting the guidelines to

follow. In accordance with the regulatory

provisions issued by the competent public

authorities and, in particular, with the measure

contained in Prime Ministerial Decree of 11

March 2020, as well as with the provisions, on

14 March 2020, of the Shared Protocol for the

regulation of measures to combat and contain

the spread of the COVID-19 virus in the

workplace, as a precautionary measure, the

Mondadori Group maintained its own Corporate

Anti-Contagion Protocol, listing the measures

adopted.

3.3.1 Information

All communications, news and information

related to the COVID-19 emergency were

circulated to all employees and associates of

the Mondadori Group, both through e-mails

sent out in a capillary fashion and over the

intranet, where, in addition to the constant

updates, the latest version of the Mondadori

Anti-Contagion Protocol is always available.

3.3.2 Guidelines on entry to premises

Again in 2022, through the forwarding of

specific communications and posting of “our

Rules of Conduct” at the entrances to the

offices, the staff and everyone needing to enter

the company have been notified that they

cannot enter if they show any flu-like symptoms

(temperature above 37.5°, a cold, cough, sore

throat, etc.) and only if authorised by their

manager.

3.3.3 Guidelines on entry of external

suppliers

All external suppliers signed and followed the

entry and parking procedures, in order to

reduce the possibilities of contact with on-site

personnel, provisions aimed at guaranteeing

the respect of personal distancing during the

necessary loading and unloading operations.

3.3.4Cleaning and sanitization of

company premises

The company has kept the extraordinary

specifications in place whereby common

contact surfaces and environments (lifts,

handrails, touch screens and others) are

sanitised on a daily basis.

In the event of the presence/reporting of a

person testing positive for COVID-19 within

company premises, the cleaning and

sanitization procedure has been implemented

according to the provisions of Circular no. 5443

of 22 February 2020 of the Ministry of Health.

At the Mondadori Group offices, where it was

technically possible, recirculated air has been

maintained; it is recalled that all air handling

units, their respective ventilation ducts and

work environments were sanitized as a

preventive measure.

153

Consolidated non-financial statement

3.3.5Personal health precautions

Information was circulated regarding all health

precautions to be implemented as defined by

the Ministry of Health; all offices have been

equipped with suitable hand sanitising

equipment.

3.3.6Personal protective equipment

During the year, all staff were assigned daily

FFP2 masks at the entrance to the offices, with

the obligation to maintain the device in the

canteen, the lift and anywhere it was not

possible to maintain the interpersonal distance

of at least one metre.

3.3.7Management of common areas

Access to the company canteen in Segrate was

suspended or restricted, limiting the use of

tables to only those stations that were

identified and reported to guarantee an

interpersonal distance of at least one metre

and after booking one's turn through a

dedicated digital app. The possibility of taking

packed lunches to be eaten at one's own

workstation or in another isolated place was

also maintained.

Daily sanitisation has been guaranteed, using

specific detergents, of the push buttons on the

vending machines, photocopiers and lifts.

3.3.8Company organization

Following agreements reached with company

trade union representatives, smart working has

been fostered, signing a specific agreement to

allow for this system to be organised and

implemented, also thanks to devices,

equipment and smartphones that the company

has supplied to all employees.

A free online psychological counselling service

was maintained to help those going through a

state of stress or discomfort related to the

specific situation experienced.

3.3.9Managing employee entry and

exit

Different entry/exit routes were maintained in

2022 too, to limit contact; hand sanitising

columns were placed at all entrances, in

addition to signage for adopting the

appropriate behaviour to contain the virus.

3.3.10Internal movement, meetings,

internal events and training

In-person meetings have been limited to those

strictly needing to be there and in respect of

interpersonal distancing, continuing to opt for

remote meetings wherever possible. Safety

training activities, if not available via e-learning,

were conducted in the classroom with a small

number of attendees and in accordance with

Government-approved procedures aimed at

containing the virus.

3.3.11 Management of a symptomatic

person in the company premises

The Mondadori Group's corporate code of

conduct, which is constantly updated as new

regulations are issued, establishes that if a

person physically present in the company

develops a fever and respiratory infection

symptoms, he or she must immediately report it

to the company's dedicated emergency

number, which runs 24 hours a day, and to the

relating e-mail address, in order to initiate the

procedure for managing a symptomatic person,

defined in collaboration with the Competent

Medical Officer.

3.3.12Health surveillance / competent

medical officer / WSR

Health surveillance visits were scheduled

adopting due precautions and in accordance

with the provisions of the protocols.

Continuing on with the measures adopted to

combat the spread of COVID-19, in 2022 too,

the Mondadori Group launched a diagnostic

screening program, offering employees of all

offices the option of taking and repeating, free

of charge and even on a weekly basis, the

antigen tests if using public transport, returning

to the office after a long absence and potential

close contact with people who have tested

positive or risk situations.

The annual anti-flu and anti-pneumonia

campaign promoted by the company, in

coordination with the Competent Medical

Officers of all the corporate locations, saw the

participation of around 800 employees and

associates.

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2022 ANNUAL FINANCIAL REPORT

3.3.13Regulatory Enforcement and

Assessment Committee

In addition to the Committee for the application

and verification of the rules of the regulatory

protocols, which involved trade union

representatives and worker safety

representatives, each site had its own

appointed safety officer who was tasked with

controlling and writing up a report on

compliance with the rules of conduct defined

by the company.

The implementation and monitoring of the

measures contained in the Company's Anti-

Contagion Protocol was ensured over time by

the presence of the Health and Safety Officers

and Managers (HSM, HSO) and Safety

Supervisors formally designated for each of the

work sites.

Similarly as was done for the offices, despite

the fact that the state of emergency was

officially declared over, the Protocol defined for

directly-owned Mondadori Retail stores was

kept in place. In addition, the specific

Operational Notice continued to be in force, by

which, in recalling the responsibility of the

Supervisors in respect of Legislative Decree

81/08, all Mondadori Store Officers and

Managers were involved to guarantee and

monitor application of the provisions given.

3.3.14Compliance with the

Consolidated Law on Safety

The handling of safety in connection with

COVID-19, which upset the priorities of the

Group's Safety Coordination in 2022 too, did

not, however, affect the planning of the annual

obligations required by Legislative Decree

81/08:

•periodic meetings: minutes were taken of the

periodic safety meetings, held digitally, at

Retail stores and Mondadori Group

institutional offices, involving the Employers

(or their delegates) of the respective

companies, the Health and Safety Managers

and Health and Safety Officers and the 10

Workers' Safety Representatives;

•on-site workplace inspections: in 2022 the

competent medical officers carried out and

took minutes of the workplace inspection of

14 company premises;

•evacuation drills: in addition to the testing of

emergency plans in the Retail stores, the

safety officers of the Mondadori Group sites

coordinated annual evacuation drills involving

the personnel in attendance. Feedback

received on the drills was then used to

identify and formalize the actions needed to

improve emergency procedures.

The refresher courses for professionals from

the prevention and protection service involved

148 workers including first aid and firefighters,

workers’ safety representatives, supervisors,

health and safety managers, health and safety

officers for a total of 1,076 hours delivered by

teachers in the classroom, complying strictly

with the provisions to guarantee the

containment of the spread of the virus; as for

the refresher programs on the remaining

mandatory safety training, e-learning courses

were organized involving 1,518 workers for a

total of 3,307 hours.

The Competent Medical Officers, in compliance

with the anti-contagion provisions, guaranteed

the occupational medicine service at all

company sites by visiting 566 workers subject

to health surveillance for risks from the use of

video terminals for over 20 hours per week.

3.3.15 Accidents in the workplace

Owing to the nature of the activities carried out

at the premises (offices and bookstores), the

risk profile for accidents in the workplace for

the Group is low. The table below shows the

accident rates for employees of Italian

companies in the three-year period

2020-2022. During the period, no cases of

occupational illness or deaths resulting from

claims were reported: the relating rates are

therefore equal to zero.

No accidents were reported in the United

States in 2022.

The number of hours worked has increased

because the reporting boundary has been

expanded, which in 2022 includes the hours of

DeAgostini Libri, D Scuola, Libromania and Star

Comics and USA.

155

Consolidated non-financial statement


Accident rates	2022	2021	2020

Hours worked (no.)	1,807,907	1,172,171	1,417,658
Number of accidents in the workplace (no.)	3	—	1
of which with severe consequences (no.) (8)	—	—	—
Rate of accidents in the workplace (9)	0.33	—	0.14
Rate of accidents in the workplace with severe consequences (10)	—	—	—
Accidents from work-related travel (no.)	4	2	6
[7] Hours worked include overtime [8] An accident with severe consequences is understood as an accident in the workplace that has caused an impairment which the employee cannot heal from, does not heal from, or is not likely to fully heal from within 180 days [9] The rate of accidents in the workplace is calculated as follows: number of accidents in the workplace/hours worked * 200,000 [10] The rate of accidents in the workplace with severe consequences is calculated as follows: no. of accidents in the workplace with severe consequences/hours worked * 200,000

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2022 ANNUAL FINANCIAL REPORT

3.4 EDUCATION AND THE SCHOOL

WORLD

In 2022, the Group’s Education area -

Mondadori Education and Rizzoli Education -

saw the integration of the publishing house D

Scuola.

In all three companies, already a few years ago,

a great many topics that can be traced to the

2030 Agenda framework were made explicit

and found their daily dimension, not only as an

element of content and teaching analysis in the

textbooks, but also with tangible initiatives.

Thus, the topic of sustainability, inclusion,

gender equality, quality education, cultural

impoverishment and school dropout, and the

promotion of reading and content

responsibility, were addressed from a variety of

perspectives and contexts.

The commitment of the publishing houses led,

in 2022, to the insertion in all production of

recurring contents and teaching sheets on the

topics:

•2030 Agenda

•Civic education and gender equality

•Inclusion.

The integration of these topics has reached

80% of production and will be completed in

2023. (see Focus on Plan).

Close attention has been paid to recording the

needs and expectations of the teachers, also in

terms of ESG, both through local focus groups

and a survey carried out under the scope of

stakeholder engagement activities.

The focus groups and local initiatives with

teachers have become consolidated practice

now, to monitor the needs of the target in

connection with sustainability topics and the

2030 Agenda goals, directly testing specific

areas of offer and identifying opportunities to

develop contents and services.

FOCUS

Teacher involvement

In the area of stakeholder engagement activities, the Group has returned, again in 2022, to

listening to the category of teachers, which is a strategically-relevant target, also in light of

the growing focus on the books and school business. An on-line questionnaire collected the

opinions of approximately 4,800 teachers in primary, middle and secondary schools

throughout all regions of Italy.

Based on their perspectives, the teachers saw the following sustainability topics as being

most important: Promotion of reading and socio-cultural growth; Promotion of sustainable

development; Education and the school world; Diversity, equity and inclusion; Climate

change and biodiversity.

Most of the answers received from the category of teachers highlighted their view that in the

short/medium-term, the Group should continue to focus on education for sustainable

development and on the activities and initiatives seeking to promote reading. Another topic

on which close attention has been paid is the Promotion of the environmental culture, on

which the Group is already committed with the school textbooks publishers. One of the

objectives of the Sustainability Plan is, in fact, to extend analyses and sheets dedicated to

environmental culture to 100% of the school offer.

The evidence that has emerged from the teachers survey has been taken into account in the

strategic formulation path reported in paragraph 1.2 and will represent concrete areas of

action on which to base actions for continuous improvement over the next few years.

157

Consolidated non-financial statement

In 2022, the offer of the Mondadori Education

and Rizzoli Education publishing houses has

been enriched with an even vaster range

intended for all teachers and students taking a

sustainability and, more generally, ESG

approach. Not only with new products

designed according to the latest teaching and

inclusion methods but also through a complete

range of tools, solutions and assistance

services: a teachers’ guide, materials for

integrated teaching, compensation tools,

contents and texts dedicated to special

educational needs, tools for verifications,

programming and digital and inclusive lessons.

In this context, great importance is assigned in

the plan to engage the target and spread

awareness, to the numerous on-line training

cycles proposed throughout the school year on

all subjects, to help teachers with their work.

Some of the initiatives promoted by the Rizzoli

Education publishing house were:

•consolidation of the strong partnership with

Erickson, a leading publisher in the

dissemination of topics related to inclusivity

for primary and first-level secondary schools.

The partnership has developed the new DAII

(augmented teaching for innovation and

inclusion) project, which aims to propose new

teaching strategies to teachers through both

textbooks and digital contents, to increase

inclusion. It is a project that operates through

both paper and digital, on 7 dimensions of

teaching: planning, assessment, creativity,

differentiation, awareness, emotional

competence and group care, autonomy and

freedom of choice;

•inclusion into the secondary school products

of paths dedicated to innovative teaching

methods with the INNOVA project. These

are teaching methods - like the flipped

classroom, the jigsaw, digital storytelling,

escape rooms, debate and teal - aimed at

making the students the real protagonists of

their learning processes through cooperative

and collaborative activities that foster

engagement and involvement and

supplement the traditional classroom-led

lesson;

•inclusion, throughout production, of recurring

fact sheets on the topics of the 2030

Agenda and related to civil education;

•“Obiettivo parità" for primary schools:

supervision, by gender educators, of

passages, illustrations and language used, to

ensure gender-balanced representation;

•Development of the “Manifesto per la parità

di genere e pluralità”: an initiative that

promotes the themes of gender equality,

multi-culture, new models of families and

inclusion.

The project was developed with internal

training dedicated to news desks and a cycle

of free events for teachers.

The initiatives promoted by the Mondadori

Education publishing house in particular:

•the new edition of the Devoto-Oli Junior,

which, following the editorial line already

undertaken by Devoto-Oli, has seen

numerous items rewritten taking a gender

equality approach and the revision of

sensitive items. Close attention has been paid

to all topics of inclusion and sustainability in

the contents and initiatives developed around

the product, to bring the youngest ones

closer to the 2030 Agenda goals, including

through words. We have also worked to

guarantee strong integration between paper

and digital, with a completely redesigned

solution, numerous resources available on-

line, interactive games, word families and

teaching sheets;

•a new section of the website has been given

over to analysis of the 2030 Agenda topics,

particularly targeting teachers of scientific

subjects in secondary schools, with in-depth

articles on topics that are consistent with the

goals;

•the on-line events and webinar programme

is very intense and complete, dedicated to

analysing the topics of inclusion and

sustainability and, more generally, the 2030

Agenda goals. The appointments proposed

include the cycles of Science Lessons,

Citizenship and Civic Education Lessons,

Italian and Literature Lessons, as well as

educational Robotics, Stem and Coding, with

interventions and references to the dedicated

website sections, which also feature

contributions in English and French;

•following the outbreak of the Russia-Ukraine

conflict, a specific intervention has been

developed to foster the welcome and

integration into Italian schools of children

coming from the war zones;

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2022 ANNUAL FINANCIAL REPORT

•specific campaigns were run to mark the

international days dedicated to topics of

inclusion, gender equality and environmental

sustainability to provide new inputs for

teachers as they broach classroom

discussions of events like the International

Holocaust Remembrance Day, the

International Day for the Elimination of

Violence Against Women or Earth Day.

The initiatives promoted by the D Scuola

publishing house include, in particular:

•the publication of teaching materials intended

exclusively for supply teachers who face

complex communication needs according to

the CAA (Alternative and Augmentative

Communication) protocol;

•the “Verso il 2050, con le scuole per un

futuro sostenibile” (Towards 2050, with

schools, for a sustainable future) project: a

cycle of webinars - in collaboration with A2A

- with the aim of helping all teachers involved

to understand how to act on a daily basis and

enhance technological scientific innovations

for a more sustainable world. The

appointments hosted experts, researchers

and popularisers from entities and

universities;

•the “Futura-Next Generation: come

preparare le giovani generazioni ad affrontare

i prossimi futuri” (Future-Next Generation:

how to prepare the young generations to face

up to the near future) project: a cycle of four

free webinars designed and organised in

collaboration with ASviS (Italian Association

for Sustainable Development) intended for

teachers at all levels, offering ideas and

activities on civic education topics;

•the “La scuola è - Festival della formazione

per i docenti di oggi e i cittadini di

domani” (School is - Training festival for the

teachers of today and the citizens of

tomorrow) project: a month of appointments

dedicated to teachers and the whole of the

school community to reflect on new learning

methods for a more sustainable future with a

focus on the transversal topics of inclusion,

gender equality, sustainable and collective

responsibility, innovation and orientation

taking a STEM approach. Numerous scientific

partners from the world of research flanked D

Scuola in this full immersion on the most

urgent topics of teaching;

•the “Educazione Climatica - OK!

CLIMA” (Climate Education - OK! CLIMATE)

project: a cycle of webinars for middle and

secondary school teachers on climate

change, which proposes ideas and tools to

help new generations gain a new sense of

collective responsibility towards the

ecosystem. The cycle of meetings comes

under the scope of the OK!CLIMA project

financed by the Cariplo Foundation and

developed by the State University of Milan,

the University of Pavia and the Italian Climate

Network in collaboration with D Scuola.

Digital Offer

Mondadori Education and Rizzoli Education

have considerably enriched the offer of the

HUB Scuola, the platform dedicated to digital

teaching, with new tools and at the same time

have also invested in user support services.

Specifically, the offering of lesson plans and

digital lessons was completed, through the

inclusion of numerous learning paths that

integrate digital resources and materials from

published textbooks. Equally extensive in terms

of educational coverage, is the proposal from

HUB Test, which allows tests on almost all the

topical areas covered. To facilitate access to

content, efforts focused on everyday tools and

platforms such as smartphones, QR-codes,

Google Forms, Google Drive, and YouTube.

The supply of disciplinary tools has been

perfected and implemented, to involve and

motivate the class during the explanation

phase: for art, HUB Art, a database containing

more than 10,000 high-definition images with

search and geolocalisation functions; for

history and geography, HUB Maps, a digital

atlas with hundreds of interactive maps and the

possibility of comparing and updating them; for

Italian literature, history and human sciences,

HUB Library, a digital library that enables

unprecedented themed paths.

Additionally, the knowledge-base of HUB

Scuola was developed and reorganized to

cover an increasing number of aspects in

support of users with a "chatbot" system, a tutor

able to support and guide users in the use of

the main features of the platform.

D Scuola has also worked on an ever greater

integration of paper and digital to involve

students in active, collaborative learning paths

and strengthen disciplinary portals (Music Zone,

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Consolidated non-financial statement

Italian, Science, Maths, etc.) to support activities

in class and at home.

2022 also saw the launch of the Deaflix

platform, which brings together thousands of

interactive digital paths for the recovery, review

or consolidation of the main aspects of the

various subjects.

To flank the schools and teachers in the

improvement process and in combating school

abandonment and dispersion, D Scuola has

developed inclusive, engaging proposals like

the first edutainment experience with an

interactive educational video game to

overcome the most difficult aspects of Italian

grammar.

In addition, Civic Education, now present in

virtually all manuals, has been enhanced with a

dedicated web area and an initiative in schools

organised in collaboration with De Agostini

Libri, with targeted meetings and video

interviews addressing the main points of the

subject (bullying, legality, digital citizenship,

amongst others).

Inclusion was another very important area of

work for D Scuola. More specifically, an

initiative has been launched for preventing

economic violence, entitled “Libere di

VIVERE” (Free to LIVE), which involved the

publication of a training text for teachers and a

series of webinars for the same target.

3.5 PROMOTION OF READING AND

SOCIO-CULTURAL GROWTH

Closely linked to the products and services

provided is the spread of the culture and

promotion of reading, which underlie the very

mission of the Mondadori Group. These

objectives not only form the basis of the

company’s economic activities but also

pervade the same logics of offer creation. As a

result, they give shape to a great many

initiatives, generally sector-specific or 160

specific to the Group, which aim to bring a

wider and wider audience closer to reading and

information.

Ever since the first edition in 2015, the

Company has taken part, with its chain of local

bookstores and its publishing houses, in

#ioleggoperché, the major national event for

the promotion of reading organized by AIE

(Italian Publishers' Association). In 2022, the

seventh edition achieved the following results:

more than 530 thousand books donated (430

thousand by readers and 100 thousand by

publishers), 3,275 bookshops adhering and

23,240 schools entered throughout Italian

territory, for a total of almost four million

beneficiary students. Additionally, the Group

regularly donates books to school and

municipal libraries, located in prisons or welfare

facilities.

The crowdfunding initiative has come to a

successful close for the two projects that won

the new edition of the “#Leparolechesiamo, la

scuola che vogliamo” competition launched by

Mondadori Education and the Nuovo Devoto-

Oli to put students at the heart of it all and help

them build the school of tomorrow.

The funds, raised by more than 150 supporters

on Produzioni dal Basso, have made it possible

to develop the following initiatives:

•“A scuola con gusto”, by the middle school

“Rina Monti Stella” of Verbania, a school to be

seen, smelt, heard, touched and tasted, i.e. a

place where we can imagine to live with “all

senses”;

•“Il Cineteatro a scuola: alziamo il sipario sul

futuro” (Cinema and theatre at school: raising

the curtain on the future), by the secondary

school ”Euclide” of Bova Marina (RC), a

proposal that puts the theatre at the heart, as

a form of education to be included in school

activities.

The various other initiatives promoted by

Mondadori Education include:

•the “La Lettura al centro” (Reading at the

centre) project, which seeks to stress the

pedagogic value of reading and its relevance

and centrality in everyday teaching activities.

Stemming from the synergy between

Mondadori Education and Mondadori - Libri

per ragazzi, the initiative was developed to

provide a complete set of proposals and tools

for each school level. The teachers have

ideas and materials available for use in class,

as well as training moments;

•the “Gli scrittori fanno scuola” (The writers

do school) offers primary and middle school

students video meetings with the authors,

thanks to the collaboration with Il Battello a

Vapore and Mondadori - Libri per Ragazzi.

The project allows children and teenagers to

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2022 ANNUAL FINANCIAL REPORT

choose a narrative book from those proposed

and, once reading is complete, to meet the

author in person or over the internet, to

compare notes on the topics that most struck

and interested them.

In 2022, the Focus Junior Academy was

confirmed, the media education initiative

designed and run by Focus Junior in

collaboration with the other Focus world brands

(Focus, Focus Storia and Focus Scuola), to

introduce children and teenagers to the world

of publishing and journalism. Just like in the

previous edition, the heart of the activity was

the 2030 UN Agenda goals. Through a rich

programme of monthly webinars, the younger

members of society approached scientific and

historical popularisation with discussions on

topical matters like the protection of

biodiversity and ecosystems, the production

and distribution of energy and climate change.

The “Alunni in libreria” (Students in the

bookshop) initiative also continued, which has

been putting Mondadori bookstores in contact

with schools for more than twenty years now,

with the aim of encouraging students to read as

well as sensitising and stimulating them in

respect of environmental matters,

multiculturalism and inclusion. The programme,

proposed by the Mondadori Stores to primary,

middle and secondary schools, included

meetings, laboratories and expressive

activities.

This initiative includes the project “Scrittori in

classe” (Writers in the class), which involved

the Mondadori stores in a partnership with the

Mondadori Ragazzi area brands, Rizzoli, Fabbri,

Piemme, which make available a selection of

authors available to meet on-line and in person

at the first, middle and secondary schools. It is

a training path that gives the students the

chance to take part in an important moment of

cultural enrichment and dialogue, with the aim

of enhancing the importance of reading and

critical analysis of the text and investigating the

topics discussed by the book.

The project allows the bookstores to establish

relations with the local schools and teachers,

with which a choice is made as to which writer

to involve in respect of the topic, thereby being

able to prepare the meeting over the weeks

and foster a more engaged participation by

students.

3.6 RESPONSIBILITY FOR

CONTENT

The editorial work of the Mondadori Group is

underpinned by the clear commitment to

guarantee through its products - whether

books, magazines, websites, applications and

digital products - accurate, meticulous and fair

information respectful of the tastes and

sensitivity of the various different audiences it

targets.

The creation of contents for the miscellaneous

bookstore production (understood as that

intended for bookstores) is guided by a

universalist vocation: to offer the most

extensive and varied range of items, ideas and

expressions.

The publisher in this case acts as a vehicle for

the authors, the only “owners” responsible for

the work published. They are given the widest

possible freedom of expression, save, where

necessary, for the need to intervene on

contents that may become defamatory in

nature.

Content auditing and conformity is, instead,

paramount in school textbooks production,

which must remain faithful to ministerial

guidelines on curricula and didactics too.

Lastly, in the magazine and web segment,

content responsibility is ensured by the

organization of the editorial offices and the

hierarchy of text approval, as well as by the

Consolidated Act on Journalist Duties.

In order to directly verify readers’ appreciation

of the Group's magazines and to gather ideas

for improvement, each year surveys are

conducted on representative samples.

In 2022, 17 quantitative surveys were

conducted for Mondadori Media (joint surveys

on various market scenarios, such as books,

videos, music and gaming), Giallozafferano and

Smartworld (marketing survey on positioning

with respect to the sector), for Focus (surveys

on the economic directory and former

subscribers), Focus Scuola (webinars dedicated

to teachers) and Focus Junior. In addition, a

market survey was also conducted for readers/

buyers of comics and former subscribers as

well as a project intended to define the

importance of collaboration between brands.

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Consolidated non-financial statement

Interaction through social networks continued

to develop quite significantly in terms of

numbers of contacts and the endless

possibilities for creating contents and events,

often cross-media, wide-reaching and

collaborative in nature.

At a corporate level, the Mondadori Group's

digital communication strategy hinges on an

integrated and consistent ecosystem that

leverages on the potential of a range of

physical and digital channels: the website and

institutional social media, the corporate Intranet

and videowalls in the locations, the multi-

purpose area Agorà and media relations. Each

social channel corresponds to an editorial plan

outlined, which addresses ad-hoc

communication goals:

•showing life inside the company and

encouraging participation of the people who

work there by involving them first-hand

(Instagram, Facebook, LinkedIn);

•describing all the Mondadori Group news

and, in particular, the activities of the books

area in collaboration with the individual

publishing houses (Twitter, Instagram and

Facebook);

•optimising the spontaneous relationship of

employees with the work spaces and with the

company, for example through user

generated content on Palazzo Mondadori

(Instagram and Facebook).

The Mondadori Group has a total of

approximately 240 social profiles (most of them

linked to individual product brands) reaching a

total of over 60 million followers.

3.7 EASE OF USE OF CONTENT

In offering quality content to a widely differing

audience base, the Mondadori Group takes

heed of the demands originating in the

changes in society, the use of technology, and

the removal of once critical language and

geographical barriers.

The desires and expectations of the customer

today play an increasing role in every sector,

but particularly so in publishing: the

participatory dimension of consumption and the

instant interaction with the end user have

disrupted the way we create and distribute

products.

The many initiatives taken during the lockdown

periods to reach users were consolidated,

allowing the various business areas to expand

their audiences and interact on an ongoing

basis.

Despite the resumption of activities in person

thanks to the attenuation of the pandemic, all of

the Group's brands continued to make

available various online content formats and

virtual meeting modes. Aside of the numerous

live streaming events, specific digital projects

were launched to increase the accessibility of

the Group's content:

With the series Il Battello a Vapore and through

the high readability books, the Mondadori and

Piemme publishing houses propose a project

suitable not only for those with specific learning

disorders but also for all children generally

finding it difficult to approach and appreciate

reading.

High readability books are intended for the age

bracket of 6-10 years old.

They are not texts with simplified contents but

rather books for everyone, with graphic

characteristics and layouts that foster

readability and therefore make them accessible

even to children with SLDs and SENs.

High readability books have the following

graphic characteristics:

•use of the leggimi font: created in Italy in

2006 by Sinnos, a publishing house

specialised in children’s books, with the

collaboration of neuropsychiatrists, speech

therapists and teachers, it is the first high

readability font specifically designed for those

experiencing reading difficulties, making the

text easier to read for everyone;

•larger than normal interline and inter-letter

spacing;

•spacing that marks the division of paragraphs

or certain narrative sequences to facilitate

understanding and set targets that the reader

can achieve;

•text always left-aligned and words never split;

•illustrations that do not interrupt the lines of

text.

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2022 ANNUAL FINANCIAL REPORT

The Group also continues to produce its

accessible eBooks in line with the new

regulations on the matter and in particular the

European Accessibility act and certified by the

LIA Foundation. Under this scope, a project has

also been developed involving the creation of

an accessible eBook with the involvement of

the author Willy Guasti for the book Il

coccodrillo ha il cuore tenero, published by

Rizzoli.

Again under the scope of EAA regulations, a

test project has been launched with one of the

key digital customers for the display and

recognition of accessible contents in a user-

friendly format. The project will continue for the

whole of 2023.

At the Bologna Children’s Book Fair, the Digital

Sales team played a lead role in an event

dedicated to accessibility, describing the

Mondadori experience and sharing best

practices in the production of accessible

eBooks.

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Consolidated non-financial statement

4. ENVIRONMENT

Environmental culture and mitigating ecosystem impacts

The Mondadori Group pays particular attention

to environmental topics, with a focus on the

impacts linked to the life cycle of paper

products, energy efficiency measures and the

reduction of greenhouse gas emissions.

The environmental policy guides the Group

from the choice to purchase certified paper to

the efficient management of points of sale, also

with a view to improving its ecological footprint.

The Group had already committed to replace

the lighting systems of the Segrate building

with a new LED light system, thereby achieving

important energy savings. In addition,

Mondadori has been involved in defining and

developing initiatives aiming to reduce the

indirect emissions generated by employees.

As part of the product life cycle, in particular

paper procurement, the Group opts for paper

certified according to the two main schemes

applied worldwide, PEFC and FSC, thus

contributing to the protection of biodiversity.

Through rationalization of the orders,

reorganization of the warehouses, and

definition of more efficient logistic requests, the

Group promotes the gradual reduction of

products meant for waste and those unsold.


	The Mondadori Group’s approach to the future in the field of sustainability is laid out consistently with the two strategic guidelines defined in the Plan (see paragraph 1.1) with the following future objectives connected with the Sustainable Development Goals (SDGs) laid down in the 2030 Agenda. The objectives achieved or started in 2022 are described in the next few paragraphs.


FOCUS	Extension to 100% of the School proposition of insights and fact sheets dedicated to environmental culture and promotion of such content in the Trade proposition.	ongoing
	Fulfilment of =100% purchase of PEFC/FSC certified paper for Mondadori Group products. Extension to the newly acquired companies.	2023/ continuous
	Pursuit of energy efficiency actions, also as part of property/building/store renovation initiatives, and assessment of further potential pilot activities to reduce greenhouse gas emissions.	ongoing
	Development of the “Book environmental footprint” project: a Life-Cycle Assessment (LCA) for the measurement of environmental impacts and the definition of data-based objectives to reduce atmospheric emissions and assure continuous improvement throughout the value chain.	by 2023
	Obtaining of UNI ISO 14001 certification for the environmental management system.	by 2024

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2022 ANNUAL FINANCIAL REPORT

4.1 MANAGEMENT OF

ENVIRONMENTAL IMPACTS

The Group's commitment to the proper

management of environmental impacts is linked

to compliance with the relevant regulations and

the mitigation of negative environmental

externalities associated with its business

activities, and is driven by the will to better

address the growing needs of the company's

many stakeholders.

Generally speaking, sustainability matters, and

hence issues connected with environmental

impacts, are referred to the internal

Sustainability Committee (see section on

"Sustainability governance"), which has drawn

up an environmental policy, published on the

Mondadori Group's corporate website

(www.gruppomondadori.it/sostenibilita/

cambiamenti-climatici).

The policy outlines the Group’s commitment

and targets for reducing its environmental

footprint and provides the framework for the

setting of Group strategy and target areas for

environmental action.

The guidelines identified in the environmental

policy steer the operational decisions and

practices of the Group, from the purchase of

paper to the management of stores, with each

company unit responsible for applying the

guidelines in its day-to-day operations.

2022 was a year marked by various trends that

impacted the company’s core business and the

management of the related environmental

impacts.

There was a significant increase in the cost of

raw materials (including paper, cardboard and

plastic), a trend that had already been seen in

2020-2021, but which was further exacerbated

in 2022 with the global increase of energy

prices. More specifically, the cost of

procurement of paper materials grew to double

in 2022, having a considerable impact on the

industry's economic sustainability.

This is in addition to the impacts deriving from

the macroeconomic and geopolitical context

that, starting February 2022 has seen a record

high in energy costs linked to gas and

electricity consumption, with consequences

throughout the entire value chain where the

Group operates.

4.2 LIFE CYCLE OF PAPER

PRODUCTS

As a publishing group, paper consumption and

the management of the life cycle of paper

products are major factors in the assessment of

environmental impacts for Mondadori.

This section looks at the environmental impacts

connected with the life cycle of paper products,

from the use of paper as a raw material to the

management of unsold copies of editorial

products published and their pulping, including

their logistical management and distribution.

The life cycle of paper products starts in paper

mills, where paper is manufactured and sent to

the printing companies that print the products.

Printed paper products are stored in

warehouses and dispatched, through a logistics

network, for delivery to distributors and end

consumers.

Once a book or magazine is in the hands of a

reader, the life cycle of paper products can

take one of three turns:

•the book or magazine remains in the reader’s

home and may be re-used (e.g., re-read,

given as a gift, donated to schools and/or

libraries);

•the book or magazine is collected for

recycling, thus becoming valuable raw

material that can be reused as pulp by paper

mills;

•the book or magazine is collected as general

waste.

4.2.1The raw material: the paper

used to print editorial products

In 2022, the total amount of paper purchased

for the printing of editorial products in the

scope of continuing operations (Italy and the

United States) amounted to approximately

55,000 tonnes (-8% versus 2021). This year too,

the Group has managed to further consolidate

the commitment made in rationalising the use

of paper in the printing of its products, a route

that was first embarked on in 2014 with the first

formalisation of the policy for the procurement

of goods and services; it has also succeeded in

having greater control over the supplier

selection process, so as to make sure that their

work is consistent with the sustainability

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Consolidated non-financial statement

principles of the Group. Supplier selection

criteria require that paper is certified by the

PEFC and FSC, the two main certification

schemes adopted worldwide, in order to

gradually increase the percentage of certified

paper used over time.

Italy

The table shows paper consumption by type of

paper (certified, traditional and recycled) for the

2020-2022 period. Continuing on from the

previous years, the percentage splits by paper

type have stayed constant over the three years.

For 2022, the data reported does not include

information on the following companies: D

Scuola S.p.A. and DeAgostini Libri S.r.l.

Total printing paper, by type, Italy


Type of paper	2022		2021		2020
Type of paper	t.	%	t.	%	t.	%

Certified	51,567	99.97%	56,389	99.98%	49,256	99.99%
Recycled	9	0.02%	3	—%	1	—%
Traditional	5	0.01%	9	0.02%	6	0.01%

Total	51,581	100.00%	56,401	100.00%	49,263	100.00%

USA

Rizzoli International Publications purchases its

raw materials indirectly through printers, based

primarily in China and, to a lesser degree, in

Italy. Focus on the use of certified papers has

increased since 2018, in line with the

commitment already undertaken in this area by

the Group.

In 2022, it is estimated that approximately 90%

of the paper used is certified, a slight increase

compared to 2021 (in 2021, approximately 85%

of paper used was certified). Below are paper

consumption estimates for 2020-2022.

Total printing paper, USA


	2022	2021	2020
Printing paper	3.700	3.600	3.500
[12] Rizzoli International Publications' 2020, 2021 and 2022 paper consumption has been estimated on the basis of the copies produced and the average weight per copy, as detailed data on actual consumption of paper for printing are not available in the documents received from suppliers, nor was it possible to trace the cost of paper alone in the data appearing in the purchase invoices.

4.2.2Logistics and the end of life of

editorial products

The Mondadori Group’s distribution logistics

takes the form of a series of overlapping

networks that cover the entire country and

differ in terms of the type of product managed

and transported. These can be divided into the

following channels: magazines (newsstands,

subscriptions, daily newspapers), books (trade

and educational), book clubs (Mondolibri

products) and e-commerce.

Many of the logistics processes include both

direct shipping to the destination points of the

relating channel and the return shipping of

unsold products.

According to the channel, unsold products may

go into storage, be processed for paper

recycling or pulping (in the case of paper

products), or be destroyed or disposed of.

The various distribution processes are

described below for each channel, with details

provided of the main associated environmental

impacts. Specifically, in 2022, regarding the

Italian scope, a total of almost 2,700 tonnes of

renewable packaging materials (wood and

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2022 ANNUAL FINANCIAL REPORT

cardboard) was consumed, while non-

renewable packaging materials (polyethylene

and polypropylene) amounted to 160 tonnes.

Data on material consumption used for

shipping are unavailable for Rizzoli International

Publications.

Magazine - Italy

The logistics for the Magazines Italy Area is

managed by Press-di Distribuzione Stampa e

Multimedia S.r.l., a wholly-owned subsidiary of

the Mondadori Group until 6 July 2022, whilst

on 1 July, the Mondadori Group’s share in the

company dropped to 49% and then dropped

further to 20%. Press-di manages the

distribution on national territory of Mondadori

magazines and of magazines and newspapers

of other publishers for the news-stands channel

and subscribers.

Press-di's logistics processes, including

transport management, are all outsourced to

select suppliers. Specifically, those concerning

magazines were entrusted at end 2019 to Di2,

of which Press-di Distribuzione Stampa e

Multimedia S.r.l. remains a 50% partner.

With regard to magazines, in 2022,

approximately 52,066 tonnes of product were

transported, entirely by road transport (with the

additional use of ship transport for distribution

to islands, involving the roll-on/roll-off of

vehicles onto ships). The cut in the number of

pallets transported, from 83,091 to 75,943

(-9.4%), is clearer than the drop in weight

carried (-6.5%), thanks to the logistical

efficiencies in warehouse and load

management brought by Di2, with resulting

benefits in terms of environmental impact due

to the reduction in the number of vehicles

required for transport.

The magazines logistics process in Italy

involves the following steps:

•industrial film wrapping, if any: in 2022, the

film wrapping process involved approximately

13.50 million copies of Mondadori Media and

Mondadori Scienza, for which 55 tonnes of

film wrapping material and 10 tonnes of

stretch film was used. This business was

discontinued by Press-di in November 2020

and returned directly to the two above-

mentioned Group companies through

agreements managed centrally by the Group

Procurement Department. The data therefore

refers only to the film wrapped copies of

Mondadori Media and Mondadori Scienza;

•shipment staging: in 2022, the shipment

staging process involved 75,943 equivalent

pallets or approximately 523 tonnes of wood;

•primary transport: from distribution logistics

centres (Cinisello Balsamo (MI), Rome) to local

distributors (40 local distributors in 2022);

•last mile (delivery to the point of sale): local

distributors deliver copies to newsstands and

carry out the “last mile” transport service to

the point of sale. Local distributors are

responsible for collecting unsold products at

newsstands every day and processing

returned products for return delivery to the

Press-di national returns centre or for local

pulping;

•transport of returned products: unsold

products subject to return to the publisher are

transported to the national returns centre of

Bregnano (Como) through the Press-di

primary transport network.

The table below shows consumption figures for

materials used in the transport of magazines to

newsstands.

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Consolidated non-financial statement

Consumption of materials for the transport of magazines to newsstands, by type


Raw material (t.)	Detail	2022	2021	2020

Wood	Pallets	523	557	553
Cardboard	Cardboards boxes and packaging materials	—	—	—
Polyethylene	Film	66	104	138
	Package filling	—	—	—
	Pallet covers	n.d.	n.d.	n.d.
Polypropylene	Tape	n.d.	n.d.	n.d.
Polypropylene	Strapping	n.d.	n.d.	n.d.
Expanded polystyrene foam	Filling of packages with polystyrene	—	—	—

The reduction in operating costs deriving from

the progressive reduction in pallets carried due

to the lesser volumes and the increase in the

average weight per pallet, which goes from 6.7

q. to 6.88 q. (+2.6%) corresponds to a

proportional reduction in emissions due to

transportation carrier use. Added to that is the

effect of the certified returns process, by which

unsold copies of publications are sent for

pulping by local distributors. The process, while

ensuring the processing of returns for statistical

and accounting purposes for the publishers,

does not require the need for the unsold copies

to return physically to the warehouse, thereby

reducing both costs and emissions.

Estimated CO2eq emissions resulting from the

transport of magazines from distribution

logistics centres to local distributors for the

three-year period 2020-2021 (in 2021 from

Cinisello Balsamo and Rome, in 2020 from

Melzo and Rom), are shown in the section

"Reducing energy consumption and combating

climate change", in the Scope 3 emissions

detail.

The daily newspapers produced by third-party

publishers (including Il Giornale, Libero,

Avvenire, La Verità, Il Fatto Quotidiano, La

Ragione) are distributed by a different logistics

network from the one used for magazines. This

network includes a number of printing centres

scattered across Italy, delivering to local

distributors. The network, designed to ensure

fast delivery times, is shared with other

distributors to guarantee greater efficiency.

With regard to the management of returns,

Mondadori has a high local pulping rate: Press-

di (in agreement with the Group and third-party

publishers distributed) has, in fact, encourages

the widespread take-up of certified returns

processes by local distributors.

At the same time, however, the ongoing

decline in newspaper and magazine

readership, which has led to a general

reduction in returns, has also affected the

number of intermediaries – local distributors

and newsstands – over the years, lowering

both their total number and those that

guarantee certified returns.

In 2022, local pulping amounted to

approximately 12,425 tonnes for magazines

and approximately 9,804 tonnes for

newspapers. Today, out of the 40 local

distributors used by Press-di, 39 guarantee

certified returns.

Trade books

2022 saw a consolidation of the restocking of

trade books in the Broni warehouse (PV) in

respect of the process linked to the return,

which is recorded, classified by quality,

registered, and stocked.

The owner of such stock, i.e. the publisher,

pays for storage and decides when to pulp the

product.

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Returns Trade books (no.) 13	2022	2021	2020

Copies	10,262,977	9,491,939	9,683,088
Packages	328,024	296,623	302,597
Shipments	38,569	33,189	33,275
[13] Figures on pallets and shipments are based on estimated number of copies

All boxes used to distribute Trade Books are

made of corrugated cardboard consisting of

90% recycled paper. This packaging is 100%

recyclable and the recycled material comes

from national pulp companies.

In 2022 too, polystyrene was replaced by a

“bubble wrap” system.

School textbooks publishing

In 2022, Mondadori Education distributed

approximately 6.1 million textbooks and

teachers’ guidebooks.

The logistics for Mondadori Education

publications is connected with specific school

education activities (promotion, adoption, and

sale of books):

•through a network of promoters, school

textbooks are presented to teachers from

January to May in order to promote their

adoption; logistics is in charge of shipping the

books from the central warehouse to the

promoters, reaching just under 130

destinations; lastly, the promoters are in

charge of delivering or shipping the sample

books to teachers. Mention should be made

in this sense of the introduction of digital

sample books (connected with the

development of multi-device digital school

books), which may lead to a reduction in the

production and shipment of print sample

books;

•starting in May and, with varying intensity, up

until the end of October, Mondadori

Education restocks the retail distribution

points for the sales campaign, reaching

approximately 20 destinations. In addition,

starting in September, when the school year

starts, the promoters are supplied with books

and guides to deliver to teachers for

classroom trials;

•as well as making shipments to decentralized

distribution centres, the central warehouse in

Verona directly supplies a number of top

accounts and approximately 800 bookstores

with university texts and L2 books (Italian as a

foreign language);

•although returns are less frequent for school

textbooks, total returns in this segment came

to approximately 680,000 copies in 2022.

The distribution processes adopted by Rizzoli

Education are similar, with the exception of the

relevant logistics hub, which in this case is

Stradella.

As for the number of copies transported,

approximately 6.5 million copies were

distributed in 2022, while returns amounted to

approximately 1 million (both data refer to sale

copies and to classroom trial copies).

Late 2022 saw the start of the transfer of the

publisher of Rizzoli Education from the Stradella

warehouse to the Isola Rizza warehouse. This

transfer should be completed by 20 January

2023.

Bookclub

For products distributed through the bookclub

channel, logistics (warehousing and preparation

of orders) and all business support processes

are managed at the Verona logistics hub.

Orders are shipped by mail.

The cardboard boxes used for shipments are

the same type used for Trade Books. Materials

returned by post are subject to recycling.

E-commerce

As regards products sold on the website

www.mondadoristore.it, B2C logistics activities

include product management (for both

Mondadori books and third-party publishers) at

the Verona logistics centre (now Ceva

Logistics); products are prepared according to

customer orders and shipments are made by

express courier directly to the final customer

address.

In this channel there are practically no returns.

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Consolidated non-financial statement

The table below shows consumption figures for materials used in the transport of Trade Books, Retail

and school textbooks.

Consumption of materials for shipping trade, retail and school books23, by type


Raw material (t.)	Detail	2022	2021	2020

Wood	Pallets	878	825	734
Cardboard	Cardboards boxes and packaging materials	1,273	1,114	954
Polyethylene	Film	26	42	58
	Package filling	29	33	12
	Pallet covers	5	5	30
Polypropylene	Tape	8	13	8
Polypropylene	Strapping	25	60	22
Expanded polystyrene foam	Filling of packages with polystyrene	0	0	13

In the strategic sustainability path, in 2022 the

Group activated a Life-Cycle Assessment

project of the book chain in collaboration with

the Polytechnic University of Milan.

The study, which will be conducted in 2023, will

allow for the assessment of which structures

are most sustainable and, at the same time,

most competitive.

The project goal is:

•to develop a model that can estimate, form an

LCA perspective, the CO2e emissions

connected with the process of conceiving,

producing, distributing, consuming (and

disposing of) book, trade and educational

products in the various formats (printed book,

ebook and audio book);

•to simulate, in addition to the as-is process,

other network structures, demand mixes,

distribution structures and the related use

mixes to assist management in choosing

future configurations and management.

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2022 ANNUAL FINANCIAL REPORT

23 The consumption figure for Mondolibri is not available.

4.2.3 Reducing energy consumption

and combating climate change

The emission reporting process implemented in

recent years by the Group has enabled the

consolidation of calculation methods, and has

acted as a baseline for raising internal

awareness about possible policies for the

reduction of greenhouse gases generated by

its operations. In this regard, the Group has

already launched a number of projects to

reduce its emissions, both in 2022 and in the

past, such as, for instance, the implementation

of energy efficiency measures in buildings.

This section looks at the environmental impact

of the Mondadori Group’s operations on global

warming. It shows and explains the data on

direct and indirect greenhouse gas emissions

produced by the Group along its entire value

chain.

Total greenhouse gas emissions at Group level

(scope of continuing operations - Italy and USA)

in 2022 amounted to approximately 26,510

tonnes of CO2, considering Scope 2 Location

Based emissions. Total electricity consumption

in 2022 amounted to 10,580 MWh, while

natural gas consumption amounted to 272,399

m³ (10,832 GJ, -25% versus 2021). In 2022, the

Group acquired 23,620 kWh of electricity,

certified from renewable sources, which was

consumed at the Duomo store starting October

2022.

Italy

Greenhouse gas emissions from Group

operations in Italy and considered within the

reporting scope of the GHG survey are

classified as either direct (Scope 1) GHG

emissions, energy indirect (Scope 2) GHG

emissions or other indirect (Scope 3) GHG

emissions.


Greenhouse gas emissions (t.)15 - Italy	2022	2021	2020

Direct (Scope 1) - CO2	829	1,069	1,109
of which, emissions related to the company car fleet (15)	279	350	384
Indirect (Scope 2)
location-based - CO2	3,250	3,304	3,676
market-based - CO2	4,703	4,814	5,097
Other indirect emissions (Scope 3) - CO 2	20,927	23,183	20,804
of which emissions related to paper production - CO 2 (16)	19,601	21,996	19,705
of which, emissions related to business travel - CO2 (17)	461	254	191
of which, emissions related to primary transport - CO2 eq (18)	866	933	908

Total emissions - CO2 (19)	25,005	27,556	25,590
[15] The Scope 1 emissions associated with the Group's car fleet make up approximately 33% of Scope 1 emissions. For 2020 and 2021, they were estimated starting from the average contracted kilometres and CO2/km emissions of individual vehicles in the fleet, whilst for 2022 the calculation was performed on the consumption data (l) of the car fleet. 70% of consumption (l) was attributed to company use. Source: “ABI Lab Guidelines on the application in the bank of GRI (Global Reporting Initiative) Standards on environmental matters - December 2022 version”. Data on fuel consumption does not include the quantities delivered for the companies: D Scuola, De Agostini Libri and Libromania. [16] Scope 3 emissions linked to paper production are shown in tonnes of CO2, as the source used does not report the emission factors of other gases than CO2. [17] Data relating to business travel are disclosed through a specific report by the travel agency used by the Group and refers to the journeys travelled by employees by air and by train. [18] As regards the data on emissions related to primary transport, note that this only includes emissions from the logistics transport of magazines (managed by Press Di S.r.l.) and instead excludes that relating to the transport of books. [19] Total emissions are calculated taking account of Scope 2 - location based emissions, and are expressed in CO2 as the share attributable to other gases is not considered material.

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Consolidated non-financial statement

Emission factors used


Electricity (location- based)	2022 Source: Terna international comparisons on Enerdata data (2019 data)	315 gCO2/kWh
	2021 Source: Terna international comparisons on Enerdata data (2019 data)	315 gCO2/kWh
	2020 Source: Terna international comparisons on Enerdata data (2018 data)	336 gCO2/kWh
Electricity (market- based)	2022 Source: AIB, (2022) European Residual Mixes 2021	457 gCO2/kWh
	2021 Source: AIB, (2021) European Residual Mixes 2020	459 gCO2/kWh
	2020 Source: AIB, (2020) European Residual Mixes 2019	466 gCO2/kWh
Natural gas	2022 Source: DEFRA: 2022 UK Government GHG Conversion Factors for Company Reporting324	2.016 kg di CO2/ m3
	2021 Source: NIR ISPRA	1.976 kg di CO2/m3
	2020 Source: NIR ISPRA	1.972 kg di CO2/m3
Paper production	2022 Source: Key Statistics 2021 of the Confederation of European Paper Industries (CEPI)	0.38 t. CO2/t. paper
	2021 Source: Key Statistics 2020 of the Confederation of European Paper Industries (CEPI)	0.39 t. CO2/t. paper
	2020 Source: Key Statistics 2019 of the Confederation of European Paper Industries (CEPI)	0.4 t. CO2/t. paper
Primary transport	2022 Source: DEFRA: 2022 UK Government GHG Conversion Factors for Company Reporting (Freighting goods - All rigids, 100% laden)	0.96 kgCO2eq/km
	2021 Source: DEFRA: 2021 UK Government GHG Conversion Factors for Company Reporting (Freighting goods - All rigids, 100% laden)	0.91 kgCO2eq/km
	2020 Source: DEFRA: 2020 UK Government GHG Conversion Factors for Company Reporting (Freighting goods - All rigids, 100% laden)	0.92 kgCO2eq/km

The Group's direct emissions (Scope 1) are

derived from:

•the consumption of natural gas for heating

offices, stores and warehouses;

•the combustion of fuel used by the cars that

make up the company's fleet.

In 2022, no top-ups of coolant gas were

required by the plants using it. In any case, any

emissions of coolant gases are not material

with respect to the organisation’s total Scope 1

emissions.


Natural gas consumption – Italy (20)	UoM	2022	2021	2020

Natural gas	m3	272,399	363,999	367,939
Natural gas	GJ	10,832	12,842	12,981
[20] Natural gas consumption is converted into GJ using the conversion factors sourced from "National standard parameters published by the Ministry for the Environment and Land and Sea Protection" published for the respective years (2021, 2020, 2019). The 2020 figure includes a partial estimate, not the actual figure on the consumption of natural gas by one of Mondadori Retail's offices, owing to a malfunction in the measurement

In Italy, the Group's gas consumption reduced

significantly during the year, dropping by 25.2%

compared to 2021, mainly due to the closure of

the Segrate office on Fridays and the specific

interventions on the cooling systems.

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2022 ANNUAL FINANCIAL REPORT

24 Considering the presence of international companies within the Mondadori Group, starting with this reporting period, to

calculate the Scope 1 emissions, the coefficients of the UK Government GHG Conversion Factors for Company Reporting

– DEFRA 2022, were used.

In Italy, the Group's gas consumption reduced

significantly during the year, dropping by 25.2%

compared to 2021, mainly due to the closure of

the Segrate office on Fridays and the specific

interventions on the cooling systems.

Energy indirect (Scope 2) GHG emissions

derive from electricity consumption, which is

sourced from the national electricity grid for the

use of:

•lighting, air conditioning (heat pumps), and

equipment (e.g. PCs, printers) in offices and

stores;

•lighting and equipment in warehouses;

•recharging electrical vehicles (Segrate) and

forklift trucks (warehouses).


Electricity consumption - Italy	UoM	2022	2021	2020

Total electricity purchased from the national grid	MWh	10,316	10,488	10,941
Total electricity purchased from the national grid	GJ	37,139	37,756	39,387

The electricity consumption trend in Italy has

settled at stable values in the three-year period

2020-2022, confirming the commitment to

reduce started in 2019 with interventions and

action taken to save energy (see the paragraph

entitled “Initiatives to reduce the environmental

impact”).

The Group’s other indirect emissions(Scope 3)

derive from:

•paper production (see section "The raw

material: the paper used to print editorial

products");

•business travel by employees;

•delivery of magazines to local distributors.

Emissions from the paper production cycle are

the prevailing part.

For 2022, these emissions amounted to

approximately 21,007 tonnes of CO2, down

(-5%) on last year. Added to these emissions

are those associated with business travel by

company personnel, mainly for the purposes of:

meeting customers, travel for reportages,

meetings with suppliers, meetings at other

company sites, and participation in events.

The following table shows the breakdown of

business travel-related emissions by means of

transport.


Emissions by means of transport	2022	2021
Train	26%	16.2%
Plane	74%	81.8%

Employee travel for business travel was

primarily by air as seen in the table above.

Other relevant Scope 3 issues are attributed to

magazine logistics. Over the course of the year,

these emissions have decreased considerably,

amounting to around 866 tonnes of CO2 eq in

2022 (908 tonnes of CO2 eq in 2020 and 933

tonnes of CO2 eq in 2021), thanks to logistics

rationalization, which brought environmental as

well as economic benefits. Specifically, the

number of journeys fell, thanks to careful

planning aimed at making the most of the

vehicles' load capacity.

USA

Data relating to greenhouse gas emissions

from operations run by Rizzoli International

Publications refer to energy indirect (Scope 2)

emissions and other indirect (Scope 3)

emissions.

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Consolidated non-financial statement


Greenhouse gas emissions (t.) - United States	2022	2021	2020

Energy indirect (Scope 2) (22) – CO2
location-based	99	102	92
market-based	99	102	92
Other indirect emissions (Scope 3) - CO2	1,406	1,404	1,400

Total location-based emissions - CO 2	1,505	1,506	1,492
[22] Scope 2 emissions are shown in tonnes of CO2; however, the percentage of methane and nitrous oxide has a negligible effect on the total greenhouse gas emissions (CO2 equivalent), as inferred from the relating technical literature. Scope 2 emissions data for 2020 (249 t.) have been recalculated based on information shown in Note 23. [23] Scope 3 emissions linked exclusively to paper production are shown in tonnes of CO2, as the source used does not report the emission factors of other gases than CO2.

For the United States of America, the figures on

gas consumption by heating are currently

unavailable for measuring direct (Scope 1) GHG

emissions, and those on emissions from

business travel (Scope 3).

As far as refrigerant gases are concerned, no

data is available to date on refills during the

year.

Emission factors used


Electricity (location-based and market-based)	2022 Source: Terna international comparisons on Enerdata data (2020 data)	374 gCO2/kWh
	2021 Source: Terna international comparisons on Enerdata data (2019 data)	374 gCO2/kWh
	2020 Source: Terna international comparisons on Enerdata data (2018 data)	399 gCO2/kWh
Paper producton	2022 Source: Key Statistics 2021 of the Confederation of European Paper Industries (CEPI)	0.38 t. CO2/t. paper
	2021 Source: Key Statistics 2020 of the Confederation of European Paper Industries (CEPI)	0.39 t. CO2/t. paper
	2020 Source: Key Statistics 2019 of the Confederation of European Paper Industries (CEPI)	0.4 t. CO2/t. paper

In 2022, total emissions by Rizzoli International

Publications were 1,505 t. CO2 from electricity

consumption and paper production, in line

versus the prior year.


Electricity consumption - United States	UoM	2022	2021	2020

Total electricity purchased from the national grid	MWh	264	272	230
Total electricity purchased from the national grid	GJ	950	979	829
[24] For 2021, the data relating to energy consumption at the Rizzoli International Publications HQ have been estimated on the basis of the consumption in 2020, given the absence of significant changes relating to business activities and/or actual changes in trends in energy consumption. With a view to ongoing improvement, the methodology for estimating energy consumption for Rizzoli International Publications relating to the bookstore, adopting for 2020 and 2021 the cost data in $/kWh made available by the Bureau of Labor Statistics for New York, was appropriately reviewed. Therefore, the 2020 data (624 MWh/2,248 GJ) have been recalculated in line with the new estimation methodology.

Water withdrawals

The Mondadori Group commitment is to

promote and guarantee responsible use of

water as a resource. This is why, starting from

this edition, the decision has been made to

report the water withdrawal data of Italian

offices but only where such data can be

properly obtained. As regards the information

given in the table below, it is stressed that fresh

water is procured by means of third party water

resources. In order to determine the areas

subject to water stress, the tool Aqueduct has

been used, developed by the World Resources

Institute, which provides information on areas

subject to extreme water scarcity, comparing

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2022 ANNUAL FINANCIAL REPORT

the best information available on water,

hygiene-sanitary services, population and

biodiversity on a national basis and of the

basin. The sites are split into five categories:

extreme scarcity, scarcity, stress, sufficient and

abundant. The Group offices considered as

situated in water stress areas are those whose

risk level is of "extreme scarcity” and “scarcity”.

For 2022 and 2021, Florence and Rome came

under this definition.


Water withdrawals by source and water stress areas - Italy 25	UoM	2022	2021
Areas not subject to water stress
Underground water	Mega litres	1806.6	1955.8
Third party water resources	Mega litres	14.9	17.5
Areas subject to water stress
Third party water resources	Mega litres	0.3	1.0
[25] The data on water withdrawal today considers the quantities of water withdrawn at the offices of Segrate, Florence and Rome.

4.3 INITIATIVES TO REDUCE THE

ENVIRONMENTAL IMPACT

4.3.1 Waste

The commitment to reducing the environmental

impact also applies to waste produced.

Given the specific business of the Mondadori

Group, only a small part of waste produced by

special products falls in the "hazardous" class.

Segrate, the only site at the moment where the

amounts of waste disposed of can be

accurately measured, between 2022 and 2021

saw an increase in the production of non-

hazardous waste (+70%) linked to the resumed

activity on site and the clearance of the floors

involved in the Segrate building restoration

project. The percentage of hazardous waste

declined (-44%).


Waste generated	2022		2021		2020
Segrate head office	t.	%	t.	%	t.	%

Hazardous	0.2	0.10%	0.36	0.31%	—	—%
Non-hazardous	199.76	99.90%	116.1	99.69%	141.247	100.00%
Total	199.96		116.460		141.247

4.3.2 Energy saving initiatives in 2022

In 2022 too, as we gradually left the pandemic

behind us, that had forced urgent interventions

and emergency management measures, the

attention to energy saving remained high, with

initiatives involving mainly the Segrate

headquarters. The initiatives shown below are

those planned in 2021 and partly implemented

in 2022, the benefits of which will be fully felt in

2023.

Others are currently in the pipeline or being

assessed and planned. It should be pointed out

that in addition to overcoming the COVID-19

emergency, the start of the building restoration,

which particularly involves the owner redoing

the plants, has put a great deal of the

developments planned previously, on hold.

Paper and toners

Among the measures taken to reduce the

environmental impacts of Group offices and

bookstores, efforts have been made in recent

175

Consolidated non-financial statement

years to raise awareness of the responsible use

of toners and paper for printing in offices.

The Group has specifically managed to keep

consumption of printing paper at the same

levels as last year, despite the partial return to

working on-site and to reduce the quantity of

toner consumed compared with the previous

reporting period.


Toner and printing paper consumption (offices) Raw material (tonnes)	2022	2021	2020

Paper for printouts	21	20	29
Toners for printouts	0.78	0,89*	0.30
*With a view to improving the data reported, the data on toner consumption for 2021 has been restated in light of the inclusion in the total calculation of the printing islands present in the Group’s office. Data on toner and paper consumption for printing in offices does not include the new companies, which joined the scope in 2022.

Segrate head office

Water and air treatment plants

•The automated program, “Optimum Start -

Summer” has been implemented for the

summer management of the main plant start-

up system in connection with the effective

occupation of the environments and external

conditions, with the aim of saving energy

whilst constantly improving well-being in the

workplace.

•The annual savings are estimated at

approximately 50,000 kWh, estimated on the

basis of the data recorded during the first

months of operation (the total benefit

expected will be measurable in summer

2023). It is also good to see that the

intervention started in 2021, relating to the

automated winter plant management system

(“Optimum Start Winter”) has confirmed the

savings expected (40,000 m3/year in gas and

20,000 KWh/year).

• A structural intervention has been performed,

modifying the hydraulics and including a new

drain regulation valve at the well water lake

used by the thermodynamic plants, with the

aim of further reducing electrical consumption

of the groundwater pumps in connection with

effective needs. Annual savings are estimated

at approximately 2,000 kW.

•Work is now approaching completion on the

temperature regulation of the hot channel of

the dual-pipe air treatment units, aiming to

save energy whilst improving well-being in

the workplace. Annual savings are estimated

at approximately 5,000 m3 of gas.

These interventions, coupled with a more

careful plant management, have made it

possible to obtain ultimate final savings also in

connection with the changes to working

activities on-site brought about by smart

working.

Group stores and bookstores

In 2022, as part of the action taken to increase

energy efficiency in Retail, the following

activities were implemented:

•all the old, energy-intensive air conditioning

systems have been replaced by new ones

using low energy consumption VRV (Variable

Refrigerant Volume) technology;

•remote control has been started of the air

conditioning systems, using smart technology

to control temperatures, times and anomalies

in the plants.

The progressive replacement of all high-

consuming/energy-intensive technical lighting

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2022 ANNUAL FINANCIAL REPORT

systems with new generation LED technology

versions, is now approaching completion.

4.3.3 Initiatives planned or in the

pipeline for 2023

Segrate head office

All spaces inside the office are expected to be

redone with the ambition and vision of making

the building a more sustainable structure with a

lesser environmental impact, through

interventions aiming to increase efficiency or by

replacing structural parts of plants. Energy will

be supplied from certified renewable sources

and the choice of materials, furnishings and

services (cleaning with Ecolabel certificates) will

also be focussed on sustainable site

management.

Work carried out to replace/modernise

obsolete plants, planned over the last few

years, has been put definitively on hold due to

the start-up of more extensive property

requalification works.

In addition, during the restructuring, any

interventions and/or changes will only be made

to maintain correct function of operating plants,

making the most of all savings opportunities

linked to failure to treat the environment of the

unused site areas and those currently not

operating due to emptying/filling of plants

linked to site needs.

Group stores and bookstores

In Retail, the project of the new flagship store

Mondadori Duomo is the pilot project on which

the Group Retail area is working in order to

obtain GOLD certification in LEED ID+C

(Leadership in Energy and Environmental

Design), a voluntary certification that promotes

an approach focussed on sustainability aspects

of buildings throughout their life cycle.

According to the parameters and provisions of

this protocol, in the Mondadori Duomo design,

an attempt will be made to seek to achieve the

highest possible level of certification that is

compatible with the structural restrictions

imposed on it by the location.

In addition, as regards the Group stores and

bookstores, in 2023 the times of the air

conditioning plants are expected to be aligned,

on the basis of the guidelines given by the

Ministerial Decree (Ministry of the Ecological

Transition) no. 383 of 06 October 2022.

As regards new stores, wherever possible the

space design aims to minimise electricity

consumption, for example through the

installation of false ceilings to reduce and limit

the cubic metres of air to be heated or cooled

within the building.

These targeted interventions come in addition

to the optimisation actions already mentioned

and allow for a further reduction in

consumptions.

Finally, in recent years energy supply contracts

have also been downsized according to

effective consumption, so as to reduce the

fixed costs linked to the installed power.

4.3.4 Emissions deriving from the

company car fleet

The Mondadori Group has been committed for

some years now to reducing emissions from

business travel related to its Italian operations.

In 2022, the size of the Group's car fleet in Italy

increased in number (from 104 in 2021 to 129 in

2022), showing a slight increase in average

emissions. The increase in emissions is linked

to the emission classes of the vehicles forming

the car fleet. The 2022 purchase of new

vehicles was also influenced by the stocks

available from dealers, preventing the Group

from opting for solutions with lower emission

classes.

With regard to the breakdown of vehicles in

“emission classes”, as determined by the

ADEME eco-label (Agence de l’Environnement

et de la Maîtrise de l’Energie, a French agency

specialized in the identification and spread of

energy, environmental protection, and

177

Consolidated non-financial statement

sustainable development information), in 2022,

38% of the car fleet consisted of class A and B

vehicles (a reduction on the figure of almost

50% recorded in 2021).


Mondadori car fleet Type (no.)	2022	2021	2020

Owned cars	—	—	—
Long-term car rental	129	104	111
of which CLASS A - less than or equal to 100 gCO2/km	16	17	16
of which CLASS B - from 101 to 120 gCO2/km	33	32	39
of which CLASS C - from 121 to 140 gCO2/km	41	29	32
of which CLASS D - from 141 to 160 gCO2/km	33	20	17
of which CLASS E - from 161 to 200 gCO2/km	5	5	6
of which CLASS F - from 201 to 250 gCO2/km	—	1	1
of which CLASS G - more than 250 gCO2/km	1	—	—
Total	129	104	111

In 2022, employees and associates were

offered various opportunities and solutions

linked to the mobility plan, taking a green

approach, conceived to support both work and

private lives. These include various conventions

for: car sharing, special-rate subscriptions for

urban and rail mobility, and e-bike and e-

scooter rental.

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2022 ANNUAL FINANCIAL REPORT

4.4 EU TAXONOMY

Regulation (EU) 2020/852 (hereinafter also the

"Regulation") has established the criteria for

determining whether an economic activity can

be considered environmentally sustainable, in

order to identify the degree of environmental

sustainability of investments, in the broader

context of the decisions for promoting

sustainable finance.

In line with the provisions of the Regulation, any

company subject to the obligation of publishing

non-financial information pursuant to Article 19 -

bis or Article art 29bis of Directive 2013/34/EU

shall include in the NFS information on how and

to what extent the company's activities are

associated with economic activities that are

considered environmentally sustainable

pursuant to Articles 3 and 9 of the Regulation.

Specifically, non-financial companies, such as

the Mondadori Group, are required to report:

1.the share of their turnover coming

from products or services associated with

economic activities that are considered

environmentally sustainable in accordance with

Articles 3 and 9 of the Regulation;

2.the share of their capital expenditure and the

share of their operating expense related to

assets or processes associated with economic

activities considered environmentally

sustainable in accordance with Articles 3 and 9

of the Regulation.

To date, the list of economic activities included

in the relevant documentation is only available

for the objectives of Climate Change Mitigation

and Climate Change Adaptation: two of the six

environmental objectives defined by Article 9

of the Regulation.

This analysis process was carried out by

comparing the Group's economic activities with

those defined by the relevant technical

documentation available to date, not only by

comparing the respective ATECO/NACE codes,

but also and above all by assessing their

substantial correlation.

At the date of publication of this document,

based on the Group's interpretation, the

publishing activities that typify its operations

are not included among those identified to date

by the relevant legislation for the two

environmental objectives referred to above,

and therefore cannot be considered eligible or

aligned. In light of this interpretation, pursuant

to the requirements of the Regulations, the

Group has calculated the proportion of

turnover, capital expenditure and operating

expense related to economic activities

currently considered to be eligible or aligned

with the defined Climate Change Mitigation and

Climate Change Adaptation objectives, finding

a 0% eligible and aligned value. In addition, the

assessment also considered the Group’s

investments, which, to date, net of certain

residual OpEx and CapEx, are not included in

the categories from 7.3 to 7.6 as envisaged by

the Regulation and consequently do not come

under the eligible (and therefore aligned)

categories.

The publication of the relevant technical rules

for the additional environmental objectives

defined in Article 9 of the Regulations, as well

as further developments in the interpretation of

the Regulations, could lead to changes in the

assessments and calculation process of these

KPIs for the next reporting years.

179

Consolidated non-financial statement

180

2022 ANNUAL FINANCIAL REPORT

181

Consolidated non-financial statement

182

2022 ANNUAL FINANCIAL REPORT

CORRELATION OF MATERIAL TOPICS AND GRI


Material topic	Scope Legislativ e Decree 254/2016	GRI aspects	Specific GRI indicators
Material topic	Scope Legislativ e Decree 254/2016	GRI aspects	Specific GRI indicators
Sustainable success, ethics and business integrity	Combating corruption and bribery	Anti-corruption	GRI 205-3
	Social	Anti-competitive behaviour	GRI 206-1
		Tax	GRI 207-1/4
		Economic performance	GRI 201-4
Product life cycle and the circular economy	Environment	Materials	GRI 301-1 GRI 301-2
Climate Change and biodiversity	Environment	Energy	GRI 302-1
		Emissions	GRI 305-1 GRI 305-2 GRI 305-3
		Waste	GRI 306-1 GRI 306-2 GRI 306-3
Diversity, equity and inclusion	Staff / Respect for human rights	Diversity and equal opportunities	GRI 405-1 GRI 405-2
Education and the school world	Social	Disclosure of content(M)	M4
Accountability and accessibility of content	Respect for human rights	Cultural rights(M)	N/A
Accountability and accessibility of content	Social	Content creation (M)	M2
Strategic business innovation	Social	Non GRI Topic	N/A
Privacy and data protection	Social	Customer privacy	GRI 418-1
Privacy and data protection	Respect for human rights	Privacy protection(M)	N/A
Promotion of reading and socio-cultural growth	Social	Interaction with the public (M)	M6
Promotion of reading and socio-cultural growth	Social	Media literacy (M)	M7
Health and safety in the workplace	Staff / Respect for human rights	Staff health and safety	GRI 403-1/7 GRI 403-9
Intellectual property and copyright protection	Social	Freedom of expression (M)	N/A
	Respect for human rights	Public policies	GRI 415-1
	Respect for human rights	Cultural rights (M)	N/A
Enhancement and management of human capital	Personnel	Employment	GRI 401-1
		Employment	GRI 401-3
		Industrial relations	GRI 402-1
		Training and education	GRI 404-1 GRI 404-2

183

Consolidated non-financial statement


Responsible Supply Chain Management	Social	Procurement practices	GRI 204-1
Enhancement and reputation of brands and publishing trademarks	Social	Non GRI Topic	N/A
Sustainable development promotion	Social	Non GRI Topic	N/A
(M): material topics under G4 Sector Disclosures – Media

184

2022 ANNUAL FINANCIAL REPORT

GRI CONTENT INDEX


Declaration of use		The Mondadori Group has prepared this Non-Financial Statement in accordance with the GRI Standards for the period from 1 January 2022 to 31 December 2022
GRI 1 used		GRI 1: Reporting standards 2021
Relevant GR sector standards		N/A

GRI STANDARD	INFORMATION	Section reference	OMISSION			GRI SECTOR STANDAR D REF. NO
GRI STANDARD	INFORMATION	Section reference	OMITTED REQUIREM ENTS	REASON	EXPLANAT ION	GRI SECTOR STANDAR D REF. NO
General disclosures
GRI 2: General Disclosure 2021	2-1 Organizational details	Methodological note / Overview of Group activities
	2-2 Entities included in the organization’s sustainability reporting	Methodological note
	2-3 Reporting period, frequency and contact point	Methodological note
	2-4 Restatements of information	Methodological note
	2-5 External assurance	Methodological note/ Report of the independent Auditors

185

Consolidated non-financial statement


	2-6 Activities, value chain and other business relationships	Overview of Group activities (2022 Annual Report) Methodological note 3.1.1 The people of the Mondadori Group 3.1.2 Organizational development and industrial relations 4.2 Life cycle of the paper products
	2-7 Employees	3.1.1 The people of the Mondadori Group
	2-8 Workers who are not employees	3.1.1 The people of the Mondadori Group
	2-9 Governance structure and composition	2.1 Governance system The additional information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 4. Board of Directors and in paragraph 6. Internal Board Committees
	2-10 Nomination and selection of the highest governance body	The information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 4. Board of Directors
	2-11 Chair of the highest governance body	The information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 4.5 Role of the Chairman of the Board of Directors

186

2022 ANNUAL FINANCIAL REPORT


	2-12 Role of the highest governance body in overseeing the management of impacts	2.1.1 Sustainability governance The additional information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 4.1 Role of the Board of Directors
	2-13 Delegation of responsibility for managing impacts	The information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 4.1. Role of the Board of Directors and paragraph 9.2 Control and Risks Committee
	2-14 Role of the highest governance body in sustainability reporting	2.1.1 Sustainability governance The additional information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 4.1 Role of the Board of Directors
	2-15 Conflicts of interest	The information requested is published in the document entitled “2022 Corporate Governance Report”, in paragraph 9. Internal Control and Risk Management System - Control and Risk Committee
	2-16 Communication of critical concerns	2.1.1 Sustainability governance
	2-17 Collective knowledge of the highest governance body	2. Governance - Promoting sustainable business success

187

Consolidated non-financial statement


	2-18 Evaluation of the performance of the highest governance body	The information requested is published in the document entitled “Report on Remuneration Policy and Compensation Paid (2022)”, in paragraph 6. Policies on fixed and variable components of remuneration
	2-19 Remuneration policies	The information requested is published in the document entitled “Report on Remuneration Policy and Compensation Paid (2022)”, in paragraph 6. Policies on fixed and variable components of remuneration
	2-20 Process to determine remuneration	The information requested is published in the document entitled “Report on Remuneration Policy and Compensation Paid (2022)”, in paragraph 6. Policies on fixed and variable components of remuneration
	2-21 Annual total compensation ratio	3.2 Diversity, equity and inclusion
	2-22 Statement on sustainable development strategy	Letter to stakeholders (2022 Annual Report)
	2-23 Policy commitments	1. Sustainability for the Mondadori Group 2.2 Group ethics and integrity 3.2 Diversity, equity and inclusion
	2-24 Embedding policy commitments

188

2022 ANNUAL FINANCIAL REPORT


	2-25 Processes to remediate negative impacts	1.2 Materiality analysis and the stakeholder engagement Internal control and risk management system ( 2022 Annual Report)) CORRELATION OF MATERIAL TOPICS AND GRI
	2-26 Mechanisms for seeking advice and raising concerns	Internal control and risk management system ( 2022 Annual Report))
	2-27 Compliance with laws and regulations	2.2.3 Compliance
	2-28 Membership of associations	2.2.7 Intellectual property and copyright protection
	2-29 Approach to stakeholder engagement	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI
	2-30 Collective bargaining agreements	3.1.2 Organizational development and industrial relations
Material topics
GRI 3: Material topics 2021	3-1 Process to determine material topics	1.2 Materiality analysis and stakeholder engagement
GRI 3: Material topics 2021	3-2 List of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI
Economic performance
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.4 Strategic business innovation

189

Consolidated non-financial statement


GRI 201 – 2016 Economic performance	201-4 Financial assistance received from government	2.2.6 Editorial independence
Procurement practices
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.2 Group ethics and integrity
GRI 204 - Procurement Practices 2016	204-1 Proportion of spending on local suppliers	2.2 Group ethics and integrity
Anti-corruption
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.2.1 Combating corruption 2.4 Strategic business innovation
GRI 205: Anti- corruption 2016	205-3 Confirmed incidents of corruption and actions taken	2.2.1 Combating corruption
Anti-competitive behaviour
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement GRI - Boundary and type of impacts 2.2.2 Market abuse 2.4 Strategic business innovation
GRI 206: Anti- competitive behaviour 2016	206-1 Legal actions for anti-competitive behaviour, antitrust and monopoly practices	2.2.2 Market Abuse
Tax

190

2022 ANNUAL FINANCIAL REPORT


GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.2.5 Tax policy 2.4 Strategic business innovation
GRI 207: Tax 2019	207-1 Approach to tax	2.2.5 Tax policy
	207-2 Tax governance, control and risk management	2.2.5 Tax policy
	207-3 Stakeholder engagement and management of concerns related to tax	1.2 Materiality analysis and stakeholder engagement 2.2.5 Tax Policy
	207-4 Country-by- country reporting	2.2.5 Tax Policy
Materials
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3 Main non-financial risks 4.1 Management of environmental impacts
GRI 301: Materials 2016	301-1 Materials used by weight or volume	4.2.2 Logistics and the end of life of editorial products 4.3.2 Energy saving initiatives in 2022
GRI 301: Materials 2016	301-2 Recycled input materials used	4.2.2 Logistics and the end of life of editorial products 4.3.2 Energy saving initiatives in 2022
Energy

191

Consolidated non-financial statement

192

2022 ANNUAL FINANCIAL REPORT


GRI 305: Emissions 2016	305-1 Direct (Scope 1) GHG emissions	4.2.3 Reducing energy consumptions and combating climate change
	305-2 Energy indirect (Scope 2) GHG emissions	4.2.3 Reducing energy consumption and combating climate change
	305-3 Other indirect (Scope 3) GHG emissions	4.2.3 Reducing energy consumption and combating climate change	Scope 3 emission s include, for Italy, emission s from paper consumpt ion, business travel and shipment s of magazine s to local distributo rs; for the United States, they include emission s from paper consumpt ion.	Data unavailab ility	Some Scope 3 categorie s are not available for all Group companie s
Waste
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3 Main non-financial risks 4.1 Management of environmental impacts 4.3.1. Waste

193

Consolidated non-financial statement


GRI 306: Waste 2020	306- 1 Waste generation and significant waste- related impacts	2.3 Main non-financial risks 4.1 Management of environmental impacts 4.3.1 Waste
	306- 2 Management of significant waste- related impacts	2.3 Main non-financial risks 4.1 Management of environmental impacts 4.3.1 Waste
	306-3 Waste generated	4.3.1 Waste	The informati on is not reported for all offices	Informati on incomplet e	Waste productio n data refer only to the Segrate offices of Arnoldo Mondado ri Editore S.p.A.
Employment
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 3.1 Enhancement and management of human capital 3.1.1 The people of the Mondadori Group
GRI 401: Employment 2016	401-1 New employee hires and employee turnover	3.1.1 The people of the Mondadori Group
GRI 401: Employment 2016	401-3 Parental Leave	3.2 Diversity, equity and inclusion
Industrial relations

194

2022 ANNUAL FINANCIAL REPORT

195

Consolidated non-financial statement


GRI 403: Health and safety in the workplace 2018	403-1 Occupational Health and Safety Management System	3.3 Health and safety in the workplace
	403-2 Hazard identification, risk assessment, and accident investigation	3.3 Health and safety in the workplace
	403-3 Occupational health services	3.3 Health and safety in the workplace
	403-4 Worker participation, consultation and communication on occupational health and safety	3.3 Health and safety in the workplace
	403-5 Worker training on occupational health and safety	3.3 Health and safety in the workplace
	403-6 Promotion of worker health	3.3 Health and safety in the workplace
	403-7 Prevention and mitigation of occupational health and safety impacts directly linked by business relationships	3.3 Health and safety in the workplace
	403-9 Work-related injuries	3.3.14 Compliance with the Consolidated Law and Safety
Training and education
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 3. SOCIAL - Enhancing people, content and places for education and culture
GRI 404: Training and education 2016	404-1 Average hours of training per year per employee	3.1.3 Training and development
GRI 404: Training and education 2016	404-2 Programs for upgrading employee skills and transition assistance programs	3.1.3 Training and development
Diversity and equal opportunities

196

2022 ANNUAL FINANCIAL REPORT


GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 3.2 Diversity, equity and inclusion
GRI 405: Diversity and equal opportunities 2016	405- 1 Diversity of governance bodies and employees	3.2 Diversity, equity and inclusion
GRI 405: Diversity and equal opportunities 2016	405- 2 Ratio of basic salary and pay of women to men	3.2 Diversity, equity and inclusion
Public policy
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement GRI - BOUNDARY AND TYPE OF IMPACTS 2.2.6 Editorial independence
GRI 415: 2016 Public policy	415-1 Political contributions	2.2.6 Editorial independence
Customer privacy
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3.2 Risks associated with social topics and respect for human rights 2.2.4 Privacy and data protection
GRI 418: Customer privacy 2016	418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data	2.2.4 Privacy and data protection
Content creation*

197

Consolidated non-financial statement


GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3.2 Risks associated with social topics and respect for human rights 3.6 Responsibility for content
M2	Methodology for assessing and monitoring adherence to content creation values	3.6 Responsibility for content
Content distribution*
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3.2 Risks associated with social topics and respect for human rights 3.4 Education and the school world 3.5 Promotion of reading and socio- cultural growth 3.6 Responsibility of content 3.7 Ease of use of content
M4	Actions taken to improve performance in relation to content dissemination issues (accessibility and protection of vulnerable audiences and informed decision making) and results obtained	3.4 Education and the school world 3.5 Promotion of reading and socio- cultural growth 3.6 Responsibility of content 3.7 Ease of use of content
Interaction with the public*

198

2022 ANNUAL FINANCIAL REPORT


GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3.2 Risks associated with social topics and respect for human rights 3.5 Promotion of reading and socio- cultural growth
M6	Methods to interact with audiences and results	3.5 Promotion of reading and socio- cultural growth
Media literacy*
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3.2 Risks associated with social topics and respect for human rights 3.5 Promotion of reading and socio- cultural growth
M7	Actions taken to empower audiences through media literacy skills development and results obtained	3.5 Promotion of reading and socio- cultural growth
Freedom of expression*
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3.2 Risks associated with social topics and respect for human rights 2.2.7 Intellectual property and copyright protection

199

Consolidated non-financial statement


Cultural rights*
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.2 Group ethics and integrity 2.3.2 Risks associated with social topics and respect for human rights 2.2.7 Intellectual property and copyright protection
Privacy protection
GRI 3: Material topics 2021	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.2 Group ethics and integrity 2.3.2 Risks associated with social topics and respect for human rights 2.2.4 Privacy and data protection
Non-GRI material topics
Strategic business innovation	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3 Main non-financial risks 2.4 Strategic business innovation

200

2022 ANNUAL FINANCIAL REPORT


Enhancement and reputation of brands and publishing trademarks	3-3 Management of material topics	1.2 Materiality analysis and stakeholder engagement CORRELATION OF MATERIAL TOPICS AND GRI 2.3 Main non-financial risks 2.4.1 Enhancement and reputation of brands and publishing trademarks
Sustainable development promotion	3-3 Management of material topics	1.1 Sustainability plan

*GRI G4 Media Sector Disclosure

For the Board of Directors

The Chairman

Marina Berlusconi

201

Consolidated non-financial statement

Meeting readers, customers and followers

In 2022, events and initiatives on-site and in hybrid mode resumed. On this page, from top-left: inauguration of the Mondadori Store in

Genoa; the Telegatto award arrives at the Eurovision Song Contest (with Aldo Vitali, editor of Tv Sorrisi e Canzoni); Mario Desiati, winner

of the Strega Prize 2022, with "Spatriati", published by Einaudi; Giallozafferano celebrates its first series of NFT recipes with Andrea

Santagata, general manager of Mondadori Media; Lucca Comics & Games, an event dedicated to the world of comics, video games and

creative industries; the first edition of the MyPersonalTrainer Days, an open-air gym in Milan; the first The Wom event with its The

WoMderful Squad (with Daniela Cerrato, Mondadori Media marketing director); the Frankfurt Book Fair where Armando Varricchio, Italian

ambassador to Germany, meets Enrico Selva Coddè, managing director of the Mondadori Libri Trade area.


	Mondadori Group Consolidated Financial Statements at 31 December 2022

CONSOLIDATED STATEMENT OF FINANCIAL POSITION


Assets	Notes	31/12/2022	31/12/2021
(Euro/thousands)	Notes	31/12/2022	31/12/2021

Intangible assets	12	372,297	351,823

Land and building		—	—
Plant and equipment		3,280	2,701
Other fixed assets		20,854	11,892
Property, plant and equipment	13	24,133	14,593

Assets from rights of use	14	68,453	80,725

Investments accounted for using the equity method		28,450	17,859
Other investments		1,298	875
Total investments	15	29,748	18,734

Non-current financial assets	28	13,410	553
Deferred tax assets	16	67,878	71,484
Other non-current assets	17	168	156
Total non-current assets		576,088	538,068

Tax receivables	18	9,049	8,833
Other current assets	19	72,213	70,469
Inventory	20	151,353	120,634
Trade receivables	21	161,230	164,971
Other current financial assets	28	614	181
Cash and cash equivalents	28	34,941	90,714
Total current assets		429,399	455,802

Discontinued or discontinuing operations	10	1,159	29,558

Total Assets		1,006,647	1,023,427

204

2022 ANNUAL FINANCIAL REPORT


Liabilities	Notes	31/12/2022	31/12/2021
(Euro/thousands)	Notes	31/12/2022	31/12/2021

Share capital		67,979	67,979
Treasury shares		(2,024)	(1,803)
Other reserves and profit/loss carried forward		141,540	109,186
Profit (Loss) for the year		52,067	44,206
Group’s Shareholders’ equity	22	259,562	219,568

Share capital and reserves attributable to non-controlling interests	23	1,263	13
Total equity		260,826	219,581

Provisions	24	41,922	47,079
Post-employment benefits	25	28,350	32,802
Non-current financial liabilities	28	119,250	122,953
Financial liabilities IFRS 16	28	58,096	71,340
Deferred tax liabilities	16	42,255	35,873
Other non-current liabilities		—	—
Total non-current liabilities		289,873	310,047

Income tax payables	18	10,671	17,431
Other current liabilities	26	142,049	144,813
Trade payables	27	252,689	217,795
Payables to banks and other financial liabilities	28	36,717	69,507
Financial liabilities IFRS 16	28	13,166	12,944
Total current liabilities		455,292	462,489

Liabilities disposed or being disposed of	10	655	31,310

Total liabilities		1,006,647	1,023,427

205

Mondadori Group Consolidated Financial Statements at 31 December 2022

CONSOLIDATED INCOME STATEMENT


(Euro/thousands)	Notes	2022	2021

Revenues from sales and services	29	903,003	807,345
Decrease (increase) in inventory	20	(18,663)	(2,320)
Cost of raw and ancillary materials, consumables and goods	30	173,248	141,930
Costs for services	31	484,601	437,022
Cost of personnel	32	136,963	136,140
Other expense (income)	33	(3,874)	3,432
Gross operating margin		130,727	91,140

Amortisation and impairment loss on intangible assets	12	39,331	26,748
Depreciation and impairment loss on property, plant and equipment	13	4,599	5,765
Amortisation/depreciation and impairment loss of assets from rights of use	14	14,106	13,427
EBIT		72,691	45,199

Financial expense (income)	34	5,635	5,124
Expense (income) from investments	35	199	1,510
Result before tax for the period		66,856	38,566

Income tax	36	15,313	(5,646)
Result from continuing operations		51,543	44,212

Result from discontinued or discontinuing operations		—	—
Net profit		51,543	44,212

Attributable to:
- Non-controlling interests	23	(524)	6
- Parent Company shareholders		52,067	44,206

Earnings per share of continuing operations (expressed in Euro units)	37	0.20	0.17
Diluted earnings per share of continuing operations (expressed in Euro units)	37	0.20	0.17

Net earnings per share (in Euro units)	37	0.20	0.17
Diluted net earnings per share (in Euro units)	37	0.20	0.17

206

2022 ANNUAL FINANCIAL REPORT

CONSOLIDATED STATEMENTS OF COMPREHENSIVE

INCOME


(Euro/thousands)	Notes	2022	2021

Net profit		51,543	44,212

Items reclassifiable to income statement

Profit and loss deriving from the conversion of currency denominated financial statements of foreign companies	22	1,388	1,986
Other profit (loss) from equity-accounted investees	22	387	(88)
Effective part of profit/(loss) on cash flow hedge instruments	28	10,531	1,405
Profit and loss deriving from held-for-sale assets (fair value)
Tax effect on other profit (loss) reclassifiable to income statement		(2,527)	(337)

Items reclassified to income statement

Effective part of profit/(loss) on cash flow hedge instruments	28	324	496
Profit and loss deriving from held-for-sale assets (fair value)		—	—
Tax effect on other profit (loss) reclassifiable to income statement		(78)	(119)

Items not reclassifiable to income statement

Actuarial gains (losses)		509	10
Tax effect on other profit (loss) not reclassifiable to income statement		(127)	(5)

Total other profit (loss) net of tax effect		10,407	3,348

Total net profit (loss)		61,950	47,560

Attributable to:
- Non-controlling interests		(524)	6
- Parent Company shareholders		62,474	47,554

For the Board of Directors

The Chairman

Marina Berlusconi

207

Mondadori Group Consolidated Financial Statements at 31 December 2022

STATEMENT OF CHANGES IN

CONSOLIDATED EQUITY

AT 31 DECEMBER 2021 AND 2022


Euro/thousands	Notes	Share capital	Treasury shares	Performance share reserve	Cash flow hedge reserve	Fair value reserve	Currency reserve	Post- employment discounting reserve	Other reserves	Profit (loss) for the period	Total Group equity	Minority shareholders’ equity	Total

Total at 31/12/2020		67,979	(2,771)	2,144	(623)	—	(1,981)	312	102,846	4,503	172,409	7	172,416
- Allocation of result									4,503	(4,503)	—		—
- Dividends paid											—		—
- Change in consolidation scope											—		—
- Transactions on treasury shares			(1,516)								(1,516)		(1,516)
- Performance shares				1,110							1,110		1,110
- Other changes			2,484	(1,977)					(496)		11	—	11
- Comprehensive profit (loss)		—	—	—	1,445	—	2,346	5	(448)	44,206	47,554	6	47,560

Total at 31/12/2021	22	67,979	(1,803)	1,277	822	—	365	317	106,405	44,206	219,567	13	219,581

208

2022 ANNUAL FINANCIAL REPORT


Euro/thousands	Notes	Share capital	Treasury shares	Performance share reserve	Cash flow hedge reserve	Fair value reserve	Currency reserve	Post- employment discounting reserve	Other reserves	Profit (loss) for the period	Total Group equity	Minority shareholders’ equity	Total

Total at 31/12/2021		67,979	(1,803)	1,277	822	—	365	317	106,405	44,206	219,567	13	219,581
- Allocation of result									44,206	(44,206)	—		—
- Dividends paid									(22,161)		(22,161)	(2)	(22,163)
- Change in consolidation scope											—	2,339	2,339
- Transactions on treasury shares			(221)						(535)		(756)		(756)
- Performance shares				454					427		881		881
- Other changes									(443)		(443)	(563)	(1,006)
- Comprehensive profit (loss)		—	—	—	8,250	—	1,374	382	401	52,067	62,474	(524)	61,950

Total at 31/12/2022	22	67,979	(2,024)	1,731	9,072	—	1,739	699	128,300	52,067	259,562	1,263	260,826

For the Board of Directors

The Chairman

Marina Berlusconi

209

Mondadori Group Consolidated Financial Statements at 31 December 2022

CONSOLIDATED STATEMENT OF CASH FLOWS


Euro/thousands	Notes			2022	13/7/1905

Net profit				52,067	44,206

Adjustments
Amortisation, depreciation and write-downs	12	13	14	58,036	45,941
Income taxes for the period			36	15,313	(5,646)
Performance Shares				881	1,110
Provisions (utilisation) and post-employment benefits				(6,473)	159
Capital loss (gain) from the transfer of intangible assets, property, plant and equipment, investments				(38)	(465)
Capital loss (gain) from the measurement of financial assets				—	268
(Income) expense of equity-accounted investees			35	199	1,510
Net financial expense on loans, leases and derivative transactions			34	5,262	4,812
Other non-monetary adjustments to assets held for sale				(5,645)	—
Cash flow generated from operations				119,602	91,895

(Increase) decrease in trade receivables				14,214	9,635
(Increase) decrease in inventory				(18,866)	5,688
Increase (decrease) in trade payables				20,841	(10,222)
Income tax payments				(21,907)	(9,974)
Advances and post-employment benefits				(4,361)	(4,121)
Net change in other assets/liabilities				(7,631)	9,260
Cash flow generated from (absorbed by) assets held for sale				(1,868)	5,239
Cash flow generated from (absorbed by) operations				100,024	97,400

Price collected (paid) net of cash transferred/acquired				(25,238)	(160,540)
(Purchase) disposal of intangible assets				(24,814)	(15,536)
(Purchase) disposal of property, plant and equipment				(9,295)	(1,946)
(Purchase) disposal of investments				(10,073)	(2,570)
(Purchase) disposal of financial assets				(2,167)	35,186
Cash flow generated from (absorbed by) assets held for sale				88	42
Cash flow generated from (absorbed by) investing activities				(71,499)	(145,364)

Net change in financial liabilities				(44,503)	53,646
Payment of net financial expense on loans and transactions with derivatives				(1,477)	(1,307)
Net refund leases				(15,432)	(14,758)
Interest on leases				(475)	(2,199)
(Purchase) disposal of treasury shares			22	(221)	(1,516)
Dividends distributed				(22,161)	—
Cash flow generated from (absorbed by) assets held for sale				(29)	(3,385)
Cash flow generated from (absorbed by) financing activities				(84,298)	30,481
Increase (decrease) in cash and cash equivalents				(55,773)	(17,483)
Cash and cash equivalents at beginning of the period			28	90,714	108,197
Cash and cash equivalents end of period			28	34,941	90,714

For the Board of Directors

The Chairman

Marina Berlusconi

210

Mondadori Group Consolidated Financial Statements at 31 December 2022

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

PURSUANT TO CONSOB REGULATION NO. 15519 OF 27

JULY 2006


Assets (Euro/thousands)	Notes	31/12/2022	of which related parties (note 40)	31/12/2021	of which related parties (note 40)

Intangible assets	12	372,297	—	351,823	—

Land and building		—	—	—	—
Plant and equipment		3,280	—	2,701	—
Other fixed assets		20,854	—	11,892	—
Property, plant and equipment	13	24,133	—	14,593	—

Assets from rights of use	14	68,453	—	80,725	—

Investments accounted for using the equity method		28,450	—	17,859	—
Other investments		1,298	—	875	—
Total investments	15	29,748	—	18,734	—

Non-current financial assets	28	13,410	2,950	553	500
Deferred tax assets	16	67,878	11,018	71,484	11,707
Other non-current assets	17	168	—	156	—
Total non-current assets		576,088	13,968	538,068	12,207

Tax receivables	18	9,049	159	8,833	1,570
Other current assets	19	72,213	308	70,469	316
Inventory	20	151,353	—	120,634	—
Trade receivables	21	161,230	26,555	164,971	29,623
Other current financial assets	28	614	—	181	—
Cash and cash equivalents	28	34,941	—	90,714	—
Total current assets		429,399	27,022	455,802	31,509

Discontinued or discontinuing operations	10	1,159	—	29,558	2,988

Total assets		1,006,647	40,990	1,023,427	46,704

212

2022 ANNUAL FINANCIAL REPORT


Liabilities (Euro/thousands)	Notes	31/12/2022	of which related parties (note 40)	31/12/2021	of which related parties (note 40)

Share capital		67,979		67,979
Treasury shares		(2,024)	—	(1,803)	—
Other reserves and profit/loss carried		141,540	—	109,186	—
Profit (Loss) for the year		52,067	—	44,206	—
Group’s Shareholders’ equity	22	259,562	—	219,568	—

Share capital and reserves attributable to non-controlling interests	23	1,263	—	13	—
Total equity		260,826	—	219,581	—

Provisions	24	41,922	—	47,079	—
Post-employment benefits	25	28,350	—	32,802	—
Non-current financial liabilities	28	119,250	—	122,953	—
Financial liabilities IFRS 16	28	58,096	—	71,340	—
Deferred tax liabilities	16	42,255	—	35,873	—
Other non-current liabilities		—	—	—	—
Total non-current liabilities		289,873	—	310,047	—

Income tax payables	18	10,671	10,061	17,431	11,898
Other current liabilities	26	142,049	354	144,813	384
Trade payables	27	252,689	6,366	217,795	7,287
Payables to banks and other financial liabilities	28	36,717	461	69,507	1,200
Financial liabilities IFRS 16	28	13,166	—	12,944	—
Total current liabilities		455,292	17,242	462,489	20,769

Liabilities disposed or being disposed of	10	655	0	31,310	1,450

Total liabilities		1,006,647	17,242	1,023,427	22,219

213

Mondadori Group Consolidated Financial Statements at 31 December 2022

CONSOLIDATED INCOME STATEMENT PURSUANT TO

CONSOB RESOLUTION NO. 15519 of 27 JULY 2006


(Euro/thousands)	Notes	2022	of which related parties (note 40)	of which non- recurring (income) expense (note 39)	2021	of which related parties (note 40)	of which non- recurring (income) expense (note 39)

Revenues from sales and services	29	903,003	66,772	—	807,345	26,175	—
Decrease (increase) in inventory	20	(18,663)	—	—	(2,320)	—	—
Cost of raw and ancillary materials, consumables and goods	30	173,248	1,125	—	141,930	2,061	—
Costs for services	31	484,601	16,737	—	437,022	10,847	—
Cost of personnel	32	136,963	(114)	—	136,140	(21)	—
Other expense (income)	33	(3,874)	473	—	3,432	200	—
Gross operating margin		130,727	48,551	—	91,140	13,088	—
Amortisation and impairment loss on intangible assets	12	39,331	—	—	26,748	—	—
Depreciation and impairment loss on property, plant and equipment	13	4,599	—	—	5,765	—	—
Amortisation/depreciation and impairment loss of assets from rights of use	14	14,106	—	—	13,427	—	—
EBIT		72,691	48,551	—	45,199	13,088	—
Financial expense (income)	34	5,635	(50)	—	5,124	(22)	—
Expense (income) from other investments	35	199	—	—	1,510	—	—
Result before tax for the period		66,856	48,601	—	38,566	13,111	—
Income tax	36	15,313	(3,698)		(5,646)	(9,816)	(18,693)
Result from continuing operations		51,543	52,299	—	44,212	22,927	18,693
Result from discontinued or discontinuing operations		—	—	—	—	—	—
Net profit		51,543	52,299	—	44,212	22,927	18,693
Attributable to:
- Non-controlling interests	23	(524)	—	—	6	—	—
- Parent Company shareholders		52,067	52,299	—	44,206	22,927	18,693

214

2022 ANNUAL FINANCIAL REPORT

EXPLANATORY NOTES

1. General information

The core business of Arnoldo Mondadori Editore S.p.A. and of its directly or indirectly owned

companies (hereinafter referred to as the “Mondadori Group” or the “Group”) is the publishing of

books and magazines.

The Group also carries out retailing activities through directly-owned and franchised stores located

across Italy.

Mondadori’s business areas offer products and services that harness cutting-edge digital technology,

thus expanding the sales portfolio.

Arnoldo Mondadori Editore S.p.A., with registered office in Via Bianca di Savoia 12, Milan, and

headquarters in Strada privata Mondadori, Segrate/Milan, is listed on the STAR segment of the

Electronic Stock Market (MTA) of Borsa Italiana S.p.A..

The publication of the consolidated financial statements of the Mondadori Group at 31 December

2022 was authorized by the Board of Directors’ resolution of 16 March 2023.

216

RELAZIONE FINANZIARIA ANNUALE 2022

2. FORM AND CONTENT

The Group's consolidated financial statements at 31 December 2022 were drawn up based on the

principle of business continuity; the Directors verified the Group's ability to fulfil future commitments

and believe there are no significant uncertainties, as defined by IAS 1.25, concerning its ability to

continue operating in the future.

The risks and uncertainties the Group is exposed to from the business carried on and the risk

mitigation measures adopted are explained in the appropriate section of the Report on Operations.

The financial statements were prepared in accordance with the International Accounting Standards

(IAS/IFRS) issued by the International Accounting Standard Board (IASB) and endorsed by the EU, and

with the International Financial Reporting Interpretations Committee (SIC/IFRIC).

These financial statements were drawn up based on the cost principle, except for some financial

instruments measured at fair value, and in compliance with the accounting standards adopted for the

drafting of the consolidated financial statements at 31 December 2021, considering the amendments

and the new standards effective as from 1 January 2022, as per Note 6.24.

I The following criteria were adopted in the drafting of these financial statements:

•in the statement of financial position, current and non-current assets and current and non-current

liabilities are shown separately;

•in the consolidated income statement, the analysis of costs is performed on the basis of the nature

of costs, since the Group deems this method more representative than a presentation by function;

•the consolidated comprehensive income statement contains revenue and cost items that are not

recognised under profit (loss) for the year as required or allowed by the IAS/IFRS accounting

standards;

•the statement of cash flows was prepared using the indirect method.rendiconto finanziario è stato

redatto utilizzando il metodo indiretto.

Regarding the requirements of CONSOB Resolution no. 15519 of 27 July 2006, specific supplementary

tables were prepared to highlight significant transactions with “Related parties” and “Non-recurring

transactions”.

The amounts shown in the tables and in these notes are expressed in Euro thousands unless

otherwise stated

217

Bilancio consolidato al 31 dicembre 2022 del Gruppo Mondadori

3. CONSOLIDATION PRINCIPLES AND SCOPE

The financial statements of the consolidated companies were drawn up on the same balance sheet

date of Arnoldo Mondadori Editore S.p.A., according to the IAS/IFRS standards.

In cases where the balance sheet date does not match the Parent Company’s, adjustments are made

to recognise the effects of any significant transactions or events that have occurred between that date

and the Parent Company’s date.

The Mondadori Group consolidated financial statements include:

•the financial statements of the Parent Company and the financial statements of Italian and foreign

companies directly or indirectly owned by Arnoldo Mondadori Editore S.p.A., according to the

provisions set out in IFRS 10. In these cases, the financial statements are consolidated on a line-by-

line basis;

•the financial statements of Italian and foreign companies in which Arnoldo Mondadori Editore S.p.A.

has joint control, either directly or indirectly, pursuant to IFRS 11. In these cases, investments are

recognised in compliance at equity;

•the financial statements of Italian and foreign companies in which Arnoldo Mondadori Editore S.p.A.

has a direct or indirect investment in an associate pursuant to IFRS 11. In these cases, in compliance

with the same standard, investments are measured at equity.

The application of the abovementioned consolidation policies led to the following adjustments:

•the book value of investments in companies included in the consolidation scope is written off against

the related equity at the date control is acquired;

•the difference between the cost incurred for the acquisition of the investment and the relevant share

of equity is recognised on the date of purchase and allocated to the specific asset and liability items

at fair value. Any positive difference is recognised under goodwill; any negative difference is

recognised in the income statement;

•consolidated equity amounts, reserves and the financial result attributable to minorities are

recognised under items in consolidated equity and income statement;

•in preparing the consolidated financial statements, receivables and payables, revenue and expense

resulting from transactions between companies included in the consolidation area are written off as

are any unrealised profit or losses on intercompany transactions.

Non-controlling interests’ equity and result for the period are recognised separately in the statements

of financial position sheet and income statement.

During 2022, the Mondadori Group completed the acquisition of 50% of De Agostini Libri S.r.l., which

held the entire share capital of Libromania S.r.l., subsequently acquired 100% by Mondadori Libri

S.p.A., 50% of A.L.I.-Agenzia Libraria Internazionale S.r.l. and 51% of Edizioni Star Comics S.r.l.

The first two companies have been consolidated on a line-by-line basis, as a result of the governance

agreements giving Mondadori control as of 1 April; A.L.I.-Agenzia Libraria Internazionale S.r.l. has been

consolidated using the equity method, since May, and Edizioni Star Comics S.r.l. has been

consolidated on a line-by-line basis since 1 July.

Further changes in the scope of consolidation are shown below:

•the establishment of Zenzero S.r.l., the Mondadori Group's social agency specialising in the area of

food, which brings together the best-known top-creators in the sector around the GialloZafferano

218

2022 ANNUAL FINANCIAL REPORT

brand, to some of whom Mondadori subsequently reserved a capital increase, bringing the Group's

share to 72%;

•the establishment of Reworld Media Italia S.r.l., as the special-purpose entity for the sale of the

magazine Grazia and the licensing contracts for the publication of the magazine abroad;

•the establishment of Mondadori Scuola S.p.A., which, as of 1 January 2023, became the holding

company of the Education segment, as a result of the spin-off by Mondadori Libri S.p.A. of its

holdings in Mondadori Education S.p.A., Rizzoli Education S.p.A. and D Scuola S.p.A;

•the sale of 80% of Press-Di Distribuzione e Stampa Multimedia S.r.l.;

•the sale of Periodici S.r.l., to follow up on the sale of the magazines Donna Moderna and CasaFacile.

For further information on transactions recognised in accordance with IFRS 3, see Note 8.

Companies in the scope of the Group consolidated financial statements and relating consolidation

method:


Company Name	Registered office	Business	Currency	Share capital expressed in foreign currency	Group shareholding in %	Group shareholding in %
Company Name	Registered office	Business	Currency	Share capital expressed in foreign currency	31/12/2022	31/12/2021

Companies consolidated on a line-by-line basis

Arnoldo Mondadori Editore S.p.A.	Milan	Publishing	Euro	67,979,168.40

Italian subsidiaries
Abscondita S.r.l.	Milan	Publishing	Euro	12,750.00	80.00	80.00
AdKaora S.r.l.	Milan	Trade	Euro	15,000.00	100.00	100.00
De Agostini Libri S.r.l.	Novara	Publishing	Euro	100,000.00	50.00
Direct Channel S.p.A.	Milan	Services	Euro	3,120,000.00	100.00	100.00
D Scuola S.p.A.	Milan	Publishing	Euro	5,000,000.00	100.00	100.00
Edizioni Star Comics S.r.l.	Perugia	Publishing	Euro	1,000,000.00	51.00
Electa S.p.A.	Milan	Publishing	Euro	1,593,735.00	100.00	100.00
Giulio Einaudi Editore S.p.A.	Turin	Publishing	Euro	23,920,000.00	100.00	100.00
Hej! S.r.l.	Milan	Publishing	Euro	17,866.66	100.00	100.00
Libromania S.r.l.	Novara	Publishing	Euro	20,000.00	100.00
Mondadori Education S.p.A.	Milan	Publishing	Euro	10,608,000.00	100.00	100.00
Mondadori Libri S.p.A.	Milan	Publishing	Euro	30,050,000.00	100.00	100.00
Mondadori Media S.p.A.	Milan	Publishing	Euro	1,000,000.00	100.00	100.00
Mondadori Retail S.p.A.	Milan	Trade	Euro	2,000,000.00	100.00	100.00
Mondadori Scienza S.p.A.	Milan	Publishing	Euro	2,600,000.00	100.00	100.00
Mondadori Scuola S.p.A.	Milan	Publishing	Euro	50,000.00	100.00
Periodici S.r.l.	Milan	Publishing	Euro	10,000.00		100.00
Reworld Media Italia S.r.l.	Milan	Publishing	Euro	10,000.00	100.00
Rizzoli Education S.p.A.	Milan	Publishing	Euro	42,405,000.00	99.99	99.99
Zenzero S.r.l.	Milan	Publishing	Euro	27,778.00	72.00

Foreign subsidiaries
Rizzoli International Publications Inc.	New York	Publishing	USD	26,900,000.00	100.00	99.99

219

Mondadori Group Consolidated Financial Statements at 31 December 2022


Rizzoli International Bookstore Inc.	New York	Trade	USD	3,499,000.00	100.00	99.99
Companies measured at equity
A.L.I.-Agenzia Libraria Internazionale S.r.l.	Cornaredo	Services	Euro	156,000.00	50.00
Digital Advertising & Engagement S.A	Madrid	Tech advertising	Euro	6,134.67	30.00	30.00
Edizioni EL S.r.l.	Trieste	Publishing	Euro	620,000.00	50.00	50.00
Gruppo Attica Publications	Athens	Publishing	Euro	4,590,000.00	41.98	41.98
Il Castello S.r.l.	Cornaredo	Publishing	Euro	10,000.00	50.00
Mach 2 Libri S.p.A. in liquidazione	Peschiera	Trade	Euro	646,250.00	44.91	44.91
Mediamond S.p.A.	Milan	Advert. agency	Euro	2,400,000.00	50.00	50.00
Mondadori Seec Advertising Co. Ltd	Beijing	Publishing	Cny	40,000,000.00	50.00	50.00
Press-Di Distr. Stampa e Mult. S.r.l.	Milan	Services	Euro	200,000.00	20.00	100.00

Companies measured at fair value
Consorzio Edicola Italiana	Milan	Services	Euro	60,000.00	16.67	16.67
Consuledit S.c.a.r.l. in liquidazione	Milan	Services	Euro	20,000.00	9.56	9.56
Immobiliare Editori Giornali S.r.l.	Rome	Real Estate	Euro	830,462.00	7.88	7.88
Società Editrice Il Mulino S.p.A.	Bologna	Publishing	Euro	2,350,000.00	7.61	7.61
Società Europea di Edizioni S.p.A.	Milan	Publishing	Euro	2,528,875.00	18.45	18.45

4. TRANSLATION OF FINANCIAL STATEMENTS DENOMINATED IN FOREIGN

CURRENCIES

All amounts in the Mondadori Group consolidated financial statements are in Euro, which is the

Group’s functional and presentation currency.

When the financial statements of companies are denominated in a different currency, they are

translated into the entity’s presentation currency as follows:

•assets and liabilities are translated at the exchange rate ruling at closing;

•income statement items are translated at the average exchange rate for the year.

Currency exchange rate differences that arise from these translations are recognised in a specific

reserve under equity.

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2022 ANNUAL FINANCIAL REPORT

5. SEGMENT INFORMATION

The reporting required by IFRS 8 reflects the Group’s organizational structure, which includes the

following segments: Books, Media, Retail, Corporate & Shared Services.

This structure gives a clear picture of the Group’s diversity in terms of products sold and services

rendered and is used by the Top Management as the basis for corporate reporting in the definition of

corporate strategies and plans, as well as in the valuation of investment opportunities and allocation of

resources.

221

Mondadori Group Consolidated Financial Statements at 31 December 2022

6. ACCOUNTING PRINCIPLES AND VALUATION CRITERIA

6.1 Intangible assets

When it is probable that costs will generate future economic benefits, intangible assets include the

cost, including ancillary expense, of the purchase of assets or resources, without any physical form,

used in the production of goods or in the supply of services, to rent to third parties or for

administrative purposes, on condition that the cost is quantifiable in a reliable manner and that the

goods are clearly identifiable and controlled by the company that owns them.

Costs incurred after the initial purchase are included in the increase of the cost of intangible assets in

direct relation to the extent to which those costs are able to generate future economic benefits.

Subsequent to initial recognition, intangible assets are measured at cost, net of accumulated

amortisation and any accumulated impairment loss.

Intangible assets purchased separately and those purchased as part of business combinations that

took place before the first-time adoption of IAS/IFRS are initially recognised at cost, while those

purchased as part of business combination transactions concluded after the first-time adoption of IAS/

IFRS are initially recognised at fair value.

On the other hand, any costs for the production and launch of trademarks and titles are charged to the

income statement for the year.

Intangible assets with finite useful life

The cost of intangible assets with finite useful life is systematically amortised over the useful life of the

asset from the moment the asset is available for use. The amortisation criteria depend on how the

relating future economic benefits contribute to the Company’s result.

The amortisation rates reflecting the useful lives attributed to intangible assets with finite useful life are

as follows:


Intangible assets with a finite useful life	Useful life

Trademarks and titles	Term of licence/10-20 years
Goods under concession or license	Term of the concession and license
Software and development costs for textbook publishing	Straight line over 3-5 years
Patents and rights	Straight line over 3-5 years
Other intangible assets	Straight line over 3-4-5 years

Intangible assets with finite useful life are subject to an impairment test whenever there is an

indication of a possible impairment. The period and method of amortisation applied are reviewed at

the end of each year or more frequently, if necessary.

Changes in the expected useful life or in the way future economic benefits linked to intangible assets

are expected to be earned by the Group are recognised by modifying the period or method of

amortisation, and are treated as adjustments to accounting estimates.

222

2022 ANNUAL FINANCIAL REPORT

Attività immateriali aventi vita utile indefinita

Intangible assets are considered to have indefinite useful life when, on the basis of a thorough

analysis of the relevant factors, there is no foreseeable limit to the length of time the assets may

generate income for the Mondadori Group.

The intangible assets identified by the Mondadori Group as having indefinite useful life are shown in

the table below:

Intangible assets with indefinite useful life

Trademarks

Series

Goodwill

Goodwill represents the excess of the cost of a business combination over the Group’s purchased

share in the fair value of the assets and liabilities acquired, as identifiable at the time of purchase.

Goodwill and other intangible assets with indefinite useful life are not subject to amortisation but to an

impairment test of their book value. This test concerns the value of the individual assets or of the cash

generating unit and is carried out whenever it is believed that the value has decreased, and in any

case at least once a year.

In cases where goodwill is attributed to a cash generating unit (or to a group of units) whose assets

are partly disposed of, goodwill associated with the asset disposed of is reviewed in order to

determine any capital gains or losses resulting from the transaction. In these circumstances, goodwill

disposed of is measured on the basis of the value of the assets disposed of, compared with the asset

still included in the cash generating unit in question.

6.2 Property, plant and equipment

Any costs attributable to the purchase of property, plant and equipment are recognised as assets, on

condition that the relevant costs can be reliably calculated and any relating future economic benefits

accrue to the entity.

Assets booked to property, plant and equipment are recognised based on the purchase method,

including any ancillary expense, and are stated net of depreciation and any impairment loss.

Costs incurred after the initial purchase are recognised as an increase in cost in direct relation to the

extent that these costs can improve the asset’s yield.

Assets booked to property, plant and equipment purchased as part of acquisitions and business

combinations are initially recognised at fair value as determined at the time of purchase and,

subsequently, at historical cost.

Assets booked to property, plant and equipment, with the exception of land, are depreciated on a

straight-line basis during the useful life of the asset from the moment the assets are available for use.

If the assets include more than one significant component and the components have different useful

lives, each individual component is depreciated separately.

The depreciation rates that generally reflect the useful lives attributed to Group property, plant and

equipment are shown in the table below:

223

Mondadori Group Consolidated Financial Statements at 31 December 2022


Property, plant and equipment	Depreciation rate

Instrumental buildings	3%
Plant	10% - 25%
Machinery	15,5%
Equipment	12,5% - 25%
Electronic office machinery	30%
Office furniture, facilities and fittings	12%
Motor and transport vehicles	20% - 30%
Other tangible assets	20%

The residual value of assets, useful lives and depreciation criteria applied are reviewed on an annual

basis and adjusted, if necessary, at year end.

Leasehold improvements are recognised as fixed assets and depreciated over the lower of the

residual useful life of the asset and the residual term of the lease contract.

6.3 Finance lease assets

IFRS 16 sets out the principles for recognising, measuring, presenting and disclosing lease contracts

and requires lessees to account for all lease contracts in the financial statements.

Application of this standard results in the initial recognition in the statement of financial position of (i)

an asset, equal to the present value of the future minimum compulsory rentals to be paid by the lessee

from 1 January 2019 or from the contract commencement date if later than the date of first-time

application, which will be amortised/depreciated over the shorter of the technical economic life and

the remaining term of the contract, and (ii) a financial liability, equal to the present value of the future

minimum compulsory rentals to be paid by the lessee from 1 January 2019 or from the contract

commencement date if later than the date of first-time application, unpaid at the transition date. The

payable will then be reduced as lease payments are made. The lease payment is no longer recorded

in EBITDA, recording instead (i) the amortisation of the right of use and (ii) the financial expense on the

payable entered.

Lessees must also remeasure the lease liability on occurrence of certain events (for example: a

change in the terms of the lease or a change in future lease payments resulting from a change in an

index or rate used to determine such payments). The lessee generally recognises the amount of the

remeasurement of the liability as an adjustment to the asset's right of use.

In the adoption of IFRS 16, the Group made use of the exemptions granted by section IFRS 16.5 (a)

relating to short-term leases, and by IFRS 16.5 (b) relating to lease contracts whose underlying asset is

a low-value asset. For such contracts, the introduction of IFRS 16 implies the recognition of the

financial liability from the lease and the relating right of use, but lease payments will be recognised in

the income statement on a straight-line basis for the duration of the respective contracts.

6.4 Financial expense

Under IAS 23, the Group capitalizes financial expense resulting from asset purchase, development or

production. In case of assets that do not justify capitalization, the expense is recognised in the income

statement in the year in which it is incurred.

6.5 Impairment

The value of intangible assets, and property, plant and equipment and rights of use is subject to an

impairment test whenever it is believed there are indications of an impairment.

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Impairment tests are carried out at least once a year on goodwill, other intangible assets with

indefinite useful life and on other assets that are not available for use, and are performed by

comparing the book value with whichever is higher between the fair value less costs to sell and the

value in use of the asset.

If no binding sales agreement or active market for an asset exist, the fair value is calculated on the

basis of the best information available on the amount the entity would obtain at closing from the

disposal of an asset in a free transaction between informed and willing parties, having deducted the

costs of disposal.

The value in use of an asset is determined by discounting the cash flows expected from its use,

subjecting forecasts of the relevant financial income on reasonable and sustainable assumptions used

by the Directors to best represent the economic conditions foreseen for the remainder of the life of

the asset, giving more weight to external indicators.

Discounting rates reflect current market estimates of the time value of money and the specific risks

connected to the asset.

The valuation is carried out by individual asset or by the smallest Cash Generating Unit that generates

cash flows from asset use.

Should the recoverable value resulting from the impairment test be lower than cost, the loss is

recognised as a reduction in the value of the asset and recognised as a cost item in the income

statement.

If during subsequent financial years, when the impairment test is repeated, the reasons for the write-

down no longer apply, the value of the asset, excluding goodwill, is written back to take account of the

new recoverable value, which should never exceed the value that would have been stated had no

impairment been recognised.

6.6 Investments

Investments in those companies in which the Group exercises control, pursuant to IFRS 10, are

consolidated on a line-by-line basis.

The definition by IFRS 10 holds that an investor controls an investee if it has all three of the following:

•power over the investee, that is to say, the investor has existing rights that give it the ability to direct

the relevant activities;

•exposure, or rights, to variable returns from its involvement in the investee;

•the ability to use its power over the investee to affect the amount of the investor’s variable returns.

Changes determined by acquisitions or disposals in the stakes held in a subsidiary, without this

leading to a loss of control, are treated as transactions with shareholders. The difference between the

fair value of the consideration paid or received for such transactions and the adjustment made to the

minority interests is recognised directly in the parent company’s equity.

Investments in companies in which strategic financial and managerial decisions on the economic

activities require the unanimous consent of all of the parties that share control, pursuant to IFRS 11, are

qualified as a joint operation or a joint venture, based on the evaluation of their own rights and of their

own obligations.

Investments in those companies in which the Group does not exercise control, but has a notable

influence on the company’s financial and strategic decisions, pursuant to IFRS 11, are consolidated at

equity.

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Mondadori Group Consolidated Financial Statements at 31 December 2022

Investments in joint ventures and associates are initially recognised at cost and subsequently adjusted

as a result of any changes in the interest the Group holds in the relevant equity.

The Group’s share of any profit and loss of such companies is recognised in the income statement.

The book value of investments in joint ventures and associates include any higher cost paid

attributable to goodwill, subject to impairment testing at least once a year.

Investments in the companies in which the Group does not have control nor does it exercise a notable

influence on the financial and strategic decisions of the company, pursuant to IFRS 9, are booked at

their fair value.

The value of investments is subject to an impairment test whenever there are indications of a possible

impairment loss.

If the impairment test indicates an impairment loss, the investment is written down; if in subsequent

years the reasons for the write-down no longer apply, the value of the investment is written-back to

the extent of its historical cost.

Write-downs and write-backs are recorded in the income statement.

Information required by IFRS 12 is given on all the investments..

6.7 Inventory

Inventory is measured at the lower of the cost and the net realisable value.

Inventory cost includes purchase costs, processing costs and other costs involved in bringing an item

to its current location and condition, without taking financial expense into consideration.

The calculation of cost of inventory is based on the weighted average cost of raw materials,

consumables and finished products purchased for sale. The FIFO method is used for finished

products.

The valuation of work in progress and semi-finished goods and contract work in progress is based on

the cost of the materials and other direct costs incurred, taking account of the progress of the

production process..

The presumed net value for raw and ancillary materials and consumables corresponds to the cost of

their replacement, while for semi-finished and finished goods it corresponds to the standard estimated

sales price net of estimated cost to completion and sales cost, respectively.

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6.8 Financial assets

Financial assets are initially recognised at cost, increased by ancillary purchase expense,

corresponding to the fair value of the price paid. Purchases and sales of financial assets are

recognised as of the trading date, which corresponds to the date on which the Group agrees to

purchase the assets in question. After initial recognition, financial assets are posted according to the

relevant classification, as outlined below:

Financial assets classified as "held to collect" and measured at fair value through P&L

This category includes financial assets held for trading, acquired for the purpose of sale in the short

term.

Profit and loss deriving from the fair value measurement of assets held for trading is recognised in the

income statement.

In an active market, the fair value of financial instruments is calculated by referring to the market value

at closing, while financial evaluation techniques are used in case of no active market. Profit and loss

deriving from the fair value measurement of assets held for trading is recognised in income statement.

Held-to-maturity investments

Assets that envisage fixed or determinable payments with a fixed maturity date, which the Group

intends to hold in its portfolio, are classified as held-to-maturity financial assets.

Long-term financial investments held to their maturity, such as bonds, are measured, after their initial

recognition by using the amortised cost method based on effective interest rates, i.e. the rates that will

apply to future payments or returns estimated for the entire life of the financial instrument.

Calculation of amortised cost also considers any discounts or premiums that will be applied over the

period of time to maturity.

Financial assets that the Group decides to keep in its portfolio for an indefinite period do not fall into

this category.

Loans and receivables

This item includes financial assets that do not have fixed or determinable payments and are not listed

on an active market.

These assets are recognised at amortised cost, under IFRS 9, using the discounting method. Profit and

loss is recognised in the income statement when loans and receivables are written off or in case of

impairment loss, as well as through amortisation.

The Group includes trade receivables, both financial and other receivables into this category. These

are due within twelve months and are therefore recorded at their estimated realisable value.

This class also includes "Cash and cash equivalents".

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Mondadori Group Consolidated Financial Statements at 31 December 2022

6.9 Trade and other receivables

Trade and other receivables are recorded at the fair value of the price collected during the

transaction. Receivables are recognised at current values when the relevant financial impact linked to

the expected collection time span is significant and the collection date can be reliably estimated.

Receivables are recognised in the financial statements at their estimated realisable value, taking

account of expected losses.

6.10 Cash and cash equivalents

“Cash and cash equivalents” includes cash on hand and financial investments falling due within three

months and which entail only a minimal risk of change in their face value.

They are recorded at fair value.

6.11 Financial liabilities

Financial liabilities include financial payables, derivative instruments, payables associated with finance

leases and trade payables.

All financial liabilities other than derivative financial instruments, under IFRS 9, are recognised at fair

value, increased by any transaction costs, and are subsequently measured at amortised cost using the

interest rate method.

Financial liabilities hedged by derivative instruments against the risk of changes in value (fair value

hedges), are measured at fair value, in accordance with IAS 39 - Hedge accounting, as an exception to

the provisions of IFRS 9: profit and loss resulting from subsequent variations in fair value is recognised

in the income statement. Any changes linked to the effective hedge portion are offset by adjusting the

value of the relevant derivative instruments.

Financial liabilities hedged by derivative instruments against the risk of changes in cash flow (cash

flow hedges), are measured at amortised cost in compliance with IAS 39 - Hedge accounting.

The Group recognises financial liabilities related to put options granted to minority shareholders at the

fair value of the option exercise price. At the balance sheet date, minority interest is reclassified as a

liability as if the acquisition of the minority interest had been carried out on that date. Change in the

fair value of the liabilities is recorded in equity.

6.12 Derecognition of financial assets and liabilities

A financial asset or, where applicable, part of a financial asset or parts of a group of similar financial

assets, is derecognised when:

•the right to receive cash flows from the asset has been extinguished;

•the Group still has the right to receive cash flows from the asset but has taken on a contractual

obligation to transfer the entire cash flow promptly to a third party;

•the Group has transferred the right to receive cash flows from an asset and has transferred

substantially all the risks and benefits deriving from ownership of the financial asset or has

transferred control of the financial asset.

A financial liability is derecognised when the underlying obligation has been discharged, cancelled or

expired.

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2022 ANNUAL FINANCIAL REPORT

6.13 Impairment of financial assets

At each balance sheet date, the Group carries out an impairment test in order to determine whether a

financial asset or group of financial assets has suffered impairment.

Financial assets recognised at amortised cost

If there is objective evidence of an impairment in loans and receivables, the loss amount is recognised

in the income statement and is calculated as the difference between the asset’s book value and the

current value of the estimated cash flows discounted based on the interest rate used initially for the

asset.

If, in a subsequent year, the impairment amount decreases and such reduction can be objectively

attributed to an event that has occurred after the recognition of impairment, the previously recognised

impairment is written back to the amount the asset would have had, taking amortisation into account,

at the date of the write-back.

6.14 Derivative financial instruments

Derivative financial instruments are initially recognised at fair value at the date they are stipulated.

When a hedge operation is entered into, the Group designates and formally documents the hedge

relationship for hedge accounting purposes and its objectives for risk and strategy management

purposes.

The documentation includes the identification of the hedging instrument, the object or transaction

subject to hedge, the nature of the risk and the criteria adopted by the Group to evaluate hedging

effectiveness in compensating exposure to fair value fluctuations of the object hedged or cash flows

correlated to the risk hedged.

It is assumed that such hedges are highly effective to offset the exposure of the object hedged against

fair value fluctuations or cash flows associated with the risk hedged. The valuation of the effectiveness

of such hedges is carried out on an ongoing basis over the years of application.

Transactions that satisfy hedge accounting criteria are accounted for as follows:

Fair value hedge

If a derivative financial instrument is designated as a hedge against the exposure to variations in the

fair value of an asset or liability attributable to a particular risk, the profit or loss deriving from

subsequent variations in the fair value of the hedge instrument is recognised in the income statement.

The profit or loss deriving from the adjustment of the fair value of the item hedged, to the extent

attributable to the risk hedged, modifies the book value of the item and is recognised in the income

statement.

As for the fair value hedge of items recognised at amortised cost, the adjustment of the book value is

amortised in the income statement throughout the period before maturity.

Any adjustments to the book value of any hedged financial instrument for which the interest rate

method is applied are amortised in the income statement.

Amortisation may begin as soon as an adjustment is identified but it may not be extended after the

date in which the object hedged ceases to be subject to fair value adjustments attributable to the

229

Mondadori Group Consolidated Financial Statements at 31 December 2022

hedging risk. If the hedged object is cancelled, the fair value that has not been amortised is

immediately recognised in the income statement.

Cash flow hedge

If a derivative financial instrument is designated as a hedging instrument against exposure to cash

flow variations of an asset or liability included in the financial statements or of a highly probable

transaction, the effective portion of profit or loss deriving from fair value adjustment of the derivative

instrument is recognised in a special reserve under equity. The accumulated profit or loss is written off

from the equity reserve and recognised in the income statement, when the results of the transaction

subject to hedge are recognised in the income statement.

Profit and loss associated with the ineffective part of a hedge is recognised in the income statement.

When a hedging instrument is terminated, but the transaction subject to hedge has not been carried

out yet, the accumulated profit and loss is kept in the reserve under equity and will be reclassified in

the income statement upon completion of the transaction. Should the transaction subject to hedge be

considered as no longer probable, any unrealised profit and loss posted under the relevant equity

reserve is recognised in the income statement.

When hedge accounting is not applicable, profit and loss deriving from the fair value measurement of

the derivative financial instrument is recognised in the income statement.

6.15 Provisions

Provisions established to cover liabilities that have been clearly identified, are certain or probable but

whose amount or date of occurrence cannot be foreseen at the reporting date, are recognised when a

legal or implicit obligation can be assumed which refers to past events and when it is also assumed

that such obligation implies expenses that can be reliably measured.

Provisions are measured at fair value based on each individual liability item. When the financial impact

associated with the assumed time span for the outlay is relevant and the payment dates can be

reliably foreseen, provisions include said financial component, which is recognised in financial income

(expense) in the income statement.

6.16 Post-employment benefits

Benefits to employees upon termination of the relevant labour contract are broken down according to

their economic nature as follows:

•defined contribution plans, represented by the sums accrued as of 1 January 2007 for Group

companies with more than 50 employees;

•defined benefit plans, represented by the severance indemnity fund for companies with less than 50

employees and the severance indemnity fund accrued until 31 December 2006 for the other Group

companies.

In the defined contribution plans, the entity’s legal or implicit obligation is limited to the amount of

contributions to pay; hence, the actuarial and investment risks fall upon the employee. In the defined

benefit plans, the entity’s obligation consists in granting and ensuring the agreed benefits to

employees; hence, the actuarial and investment risks fall upon the entity.

Post-employment benefits for companies with more than 50 employees are calculated by applying

actuarial criteria to the severance indemnity provision accrued until the date of the financial

statements, taking into account both demographic assumptions, including mortality rates and

employee turnover, and financial assumptions, relating to discounts reflecting the time value of money

and the inflation rate.

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2022 ANNUAL FINANCIAL REPORT

Post-employment benefits for companies with less than 50 employees are calculated by applying the

same actuarial criteria, taking account of current and future salary levels.

The amount recognised as a liability for defined benefit plans is represented by the current liability

value at closing, net of the current value of plan assets, if any.

This liability item is recognised in the income statement and includes the following components:

•social security costs relating to current labour, when fulfilling the relevant requirements;

•cost of interest.

The amounts accrued in favour of employees during the year are recognised under “Cost of

personnel”, while the relevant financial component, which represents the cost the company would

have to incur if it were to seek a loan on the market for the same amount, is recognised under

“Financial income (expense)”.

Actuarial profit and loss is recognised in a specific item under equity and in the comprehensive

income statement.

The supplementary indemnity for agents is also determined on an actuarial basis. The amounts

accrued in favour of agents during the year, which become payable upon termination of the labour

contract only under certain conditions, are recognised under “Other expense (income)”.

6.17 Equity compensation plans

The Group grants additional benefits to a number of board members and managers whose functions

are strategically relevant for the achievement of results, through equity-settled compensation plans

(Performance Share Plan).

In the case of share-based payments transactions settled with equity instruments of the Parent

Company, the fair value at the granting date, calculated according to a binomial model, is recorded

under cost of personnel, with a corresponding increase in Equity under "Reserve for Performance

shares", over the period during which the employees obtain the unconditional right to the incentives.

Subsequently, the amount recognised as a cost is adjusted to reflect the actual number of shares for

which the service condition and the non-market condition have been met, so that the final amount

recorded as a cost is based on the number of incentives that will definitely vest.

Service or performance conditions are not taken into account when defining the fair value of the plan

at the granting date. However, the probability of these conditions being met is taken into account

when defining the best estimate of the number of equity instruments that will vest. Market conditions

are reflected in the fair value at granting date.

Any other conditions attached to the plan that do not involve a service obligation are not considered

to be a vesting condition. Non-vesting conditions are reflected in the fair value of the plan and result in

the immediate recognition of the cost of the plan, unless there are also service or performance

conditions.

No cost is recognised for rights that do not ultimately vest because the performance and/or service

conditions have not been met.

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Mondadori Group Consolidated Financial Statements at 31 December 2022

6.18 Recognition of revenue and costs

Revenue from the sale of goods is recorded net of trade discounts, allowances and returns, when the

right to payment and the operating benefits resulting from the sale become unconditional and the

obligation is met.

As principal, the Group recognises revenues from the sale of its own books and magazines, as well as

revenue from related advertising space, on the basis of the retail price; as agent, it recognises

revenues from the sale of books and magazines owned by distributed third publishers, as well as

revenues from related advertising space, on the basis of the retail price net of related costs, showing

the intermediation margin only.

Revenue from services is recognised based on the relevant state of completion.

Revenue from interest is recognised on an accrual basis by applying the interest method; royalties are

recognised on an accrual basis and subject to the conditions of the relevant agreements; dividends

are recognised when the shareholder is acknowledged the right to payment.

Any revenue from barter transactions is recognised at fair value when the barter deal involves

dissimilar services. Dissimilar services comprise barter deals for goods and advertising, when they

refer to different communications means or product positioning..

Costs are recognised based on similar criteria as revenue and, in any case, on an accrual basis.

6.19 Current, pre-paid and deferred tax

Current tax is calculated on the basis of a taxable income estimate and in accordance with the laws

applicable in the individual countries in which any of the Group companies has its registered offices.

Deferred and pre-paid tax is calculated on all the temporary differences between recognised assets

and liabilities and the relevant book values booked in the financial statements for tax purposes, with

the exception of the following:

•temporary taxable differences deriving from the initial recognition of goodwill;

•temporary differences resulting from the initial recognition of an asset or a liability in a transaction

which does not imply a business combination and which does not have any impact either on the

result or the taxable income on the transaction date;

•temporary differences relating to the value of the shareholding held in subsidiary, associates and

jointly-controlled companies when:

•the Group is in a position to control the timing for the reversal of temporary taxable differences and it

is probable that such differences will not reverse in the foreseeable future;

•it is not probable that deductible temporary differences will reverse in the foreseeable future and

that taxable income is available to cover such temporary differences.

The value of prepaid tax amounts is reviewed at the balance sheet date and is reduced if it is no

longer probable that sufficient taxable income will be available in the future to cover all or part of

these assets.

Deferred and prepaid tax is calculated on the basis of the tax rates that are expected to apply in the

period in which assets are realised and liabilities are settled, considering the then applicable tax rates

or the tax rates essentially used at the balance sheet date.

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2022 ANNUAL FINANCIAL REPORT

Deferred and prepaid tax amounts relating to items directly recognised under equity are recognised

directly under equity.

6.20 Foreign currency transactions

Revenue and costs deriving from transactions denominated in foreign currencies are posted in the

relevant currency at the exchange rate applied on the transaction date.

Monetary assets and liabilities denominated in foreign currencies are converted at the exchange rate

ruling at closing and any exchange differences are recognised in the income statement, except for the

differences deriving from loans denominated in foreign currency taken out to pay for the acquisition of

an investment in a foreign company. In the latter case, such differences are recognised under equity

until disposal.

Non-monetary items measured at historical cost in a foreign currency are converted using the

exchange rates applied on the relevant transaction date. Non-monetary items recognised at fair value

in a foreign currency are converted using the exchange rates applied on the fair value calculation

date.

6.21 Grants and contributions

Grants and contributions are recognised if there is a reasonable certainty that they will be received

and if all the conditions referring to them are satisfied. When grants refer to cost items, they are

recognised as revenue and systematically distributed over the years so as to reflect the cost

proportion they are intended to offset.

When grants refer to assets, the relevant fair value is deferred in long-term liabilities and is recognised

in equal amounts in the income statement over the useful life of the asset.

With regard to any State aid and/or "de minimis" aid received, reference is additionally made to the

content contained and published in the National State Aid Register.

6.22 Earnings per share

Earnings per share refer to the Group’s net profit divided by the weighted average number of

outstanding shares in the reporting period.

For the purpose of calculating diluted earnings per share, the weighted average number of

outstanding shares is adjusted on the assumption of converting shares with a dilution effect.

6.23 Discontinued assets and liabilities (discontinued operations)

Non-current assets and groups of assets and liabilities whose book value is mainly expected to be

recovered through disposal instead of continuous use are recognised separately from other assets

and liabilities in the statement of financial position. Such assets and liabilities, when their sale is highly

likely, are classified as “held-for-sale assets” and are measured at the lower between their book value

and fair value less probable costs of disposal. Profit and loss, net of the related tax effect, resulting

from the valuation or disposal of such assets or liabilities, is recognised in a separate item in the

income statement.

6.24 Accounting standards and interpretations adopted by the European Union with

effect from 1 January 2022 and applied by the Mondadori Group

The following is a list of new standards, interpretations and amendments with mandatory application

from 1 January 2022 that, based on the assessments performed, did not have a significant impact on

the consolidated financial statements as at 31 December 2022:

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Mondadori Group Consolidated Financial Statements at 31 December 2022

•amendments to IFRS 3 Business Combinations;

•amendments to IAS 16 Property, Plant and Equipment;

•amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets;

•annual Improvements 2018-2020.

6.25 Accounting standards, amendments and interpretations not yet endorsed by the

European Union

The following new accounting standards, amendments and interpretations were issued at the date of

this document and have not yet entered into force and have not been adopted in advance by the

Group:

•IFRS 17, effective from 1 January 2023;

•amendments to IAS 12 Income Taxes: Deferred Taxes Relating to Assets and Liabilities Arising from

a Single Transaction, effective from 1 January 2023;

•amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure

of the accounting standards, effective from 1 January 2023;

•amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, effective

from 1 January 2023;

•amendments to IAS 1 Presentation of Annual Financial Statements, effective from 1 January 2024:

- classification of liabilities into current and non-current;

- classification of liabilities into current and non-current - deferral of the effective date;

- non-current liabilities with covenants.

•amendments to IFRS 16 Leases: lease liability in a sale and leaseback, effective from 1 January 2024.

7. USE OF ESTIMATES

The drafting of these financial statements and the notes required the use of estimates and

assumptions by the Directors, which have an impact on the value of assets and liabilities and on the

disclosures relating to potential assets and liabilities at closing, based on the application of the IAS/

IFRS accounting standards.

Estimates are based on the current status of information available, are reviewed periodically, and the

effects are reflected in the income statement.

Specifically, estimates on future trends have been made in light of the level of uncertainty in the

current geopolitical, macroeconomic and market environment. Therefore, one cannot rule out the

possibility in the future of seeing results that differ from estimates, requiring adjustments to the book

value of items, which cannot be foreseen or measured at this time.

The most significant estimates refer to:

Goodwill, intangible assets with indefinite useful life and other non-current assets

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2022 ANNUAL FINANCIAL REPORT

The value of goodwill of intangible assets with indefinite useful life and other non-current assets with

finite useful life (for the latter, in the presence of indications of impairment loss) is assessed by

comparing the book value of the individual assets or the smallest Cash Generating Unit that generates

its own cash flows with their recoverable value, represented by the higher of fair value, less costs to

sell, and value in use. This process includes, among others, the application of methods such as

discounted cash flow, with the relevant assumptions.

Amortisation/depreciation

The useful life of tangible and intangible assets is determined by the Directors when the asset is

purchased. The Group regularly assesses any changes in technology, market conditions and

expectations of future events that could have an impact on the useful life and duration of amortisation/

depreciation.

Write-down of advances to authors

The Group estimates the amount of the advances paid to authors to be written down, as they are

considered non-recoverable, based on analyses carried out both for published literary works and

those to be published.

Write-down of inventory

The Group estimates the amount of inventory to subject to impairment loss based on specific analyses

ascertaining finished product marketability and the relevant turnover rates, and, for orders in progress,

the Group considers the relevant risk of failed completion.

Provision for bad debts

The recoverability of receivables is measured by taking account of the risk of non-payment, ageing

and losses on receivables expected to arise on the receivables.

Returns to receive

In the publishing sector, it is an accepted practice for unsold books and magazines to be returned to

the publisher under pre-established conditions.

Therefore, at the end of each financial year the Group measures the quantities that are expected to be

returned in the following years: this estimate is based on historical statistics and takes account also of

the level of circulation and any other elements that may affect the quantities of books and magazines

returned.

Provision for risks

Allocations made for costs for legal, tax and arbitration disputes are based on complex estimates that

take account of the likelihood of losing the disputes.

Post-employment benefits

Allocations made in favour of employees are based on actuarial assumptions: any changes in the

underlying assumptions may have significant effects on the provisions.

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Mondadori Group Consolidated Financial Statements at 31 December 2022

Income tax

Income tax (both current and deferred) is calculated based on the applicable rates in each individual

country in which the Group operates, according to a prudent interpretation of currently applicable tax

laws.

8. BUSINESS COMBINATIONS AND ACQUISITIONS

Business combinations are recognised using the purchase cost method pursuant to IFRS 3.

Upon acquisition date, assets and liabilities pertaining to the transaction are recognised at fair value,

except for any anticipated and deferred tax and assets and liabilities relating to benefits in favour of

employees, any equity compensation plans as well as assets classified as held for sale, which are

measured according to the relevant reference standard.

Ancillary expense relating to the transaction is recognised in the income statement in the year in

which it is incurred.

Goodwill represents the difference between acquisition price, minority shareholders’ equity and the

fair value of any interest previously held in the acquired company against the fair value of the net

assets and liabilities acquired upon completion of the transaction.

When the value of the net assets and liabilities purchased on the acquisition date exceeds the

acquisition price, the minority shareholders’ equity and the fair value of any interest previously held in

the acquired company, such excess amount is recognised in the income statement in the year in

which the acquisition transaction is completed.

Non-controlling interests’ equity may be measured, at acquisition date, either at fair value or pro-rata

of the net assets recognised for the acquired company.

The choice of valuation method is made individually for each transaction.

For the purpose of calculating goodwill, any prices relating to the acquisition subject to the conditions

of, and envisaged by business combination contracts, are measured at fair value as at the acquisition

date and included in the relevant acquisition price.

Any subsequent changes in the fair value, referred to as adjustments deriving from additional

information provided about facts and circumstances existing on the business combination completion

date and in any case identified within the subsequent twelve months, are retroactively included in the

value of goodwill.

In case of business combinations accomplished in subsequent steps, the investment previously held in

the acquired company is subject to write-back at fair value from the date of control acquisition and any

resulting profit or loss is recognised in the income statement in the year in which the transaction is

completed.

Should the values of the assets and liabilities acquired be incomplete as at the date of drafting of

these financial statements, the Group recognises provisional values that will be later subject to

adjustments in the financial year of reference within twelve months thereafter, so as to take account of

any new information about facts and circumstances existing at the acquisition date, that, if made

available earlier, would have had an impact on the value of the assets and liabilities recognised on that

same date.

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2022 ANNUAL FINANCIAL REPORT

Purchase of the stake in De Agostini Libri S.r.l

The transaction

On 1 April 2022, Mondadori finalised the acquisition of 50% of the share capital of De Agostini Libri

S.r.l., a company operating in the trade book sector with a focus on the children's and non-fiction

segments; the transaction also includes Libromania S.r.l., which operates in the product publishing and

promotion segment.

The transaction, which creates a partnership with a time-honoured publishing house boasting a strong

heritage and know-how, is in line with the strategy of increasing the focus on the core business of

books, pursued also through a process of vertical integration in the books market.

The corporate governance structure entitles the Mondadori Group with control and the need fully

consolidate the stake.

The consideration for the transaction amounts to a total of € 3,439 thousand, which is scheduled to be

paid in 2023.

The transaction is classified as a business combination under IFRS 3, which requires the acquirer to

allocate the cost by measuring the fair value of all assets, liabilities and contingent liabilities in order to

meet the recognition criteria at the acquisition date.

Cost of acquisition

The cost of the acquisition was € 3,439 thousand, net of the costs incurred for the transaction of € 115

thousand.


Acquisition of De Agostini Libri S.r.l.
(Euro/thousands)
Acquisition cost of De Agostini Libri S.r.l.	3,439

Cash used for acquisition:
payments made	—
deferred payments	(3,439)
liquidity of De Agostini Libri S.r.l.	472

Net cash flows absorbed by acquisition	(2,967)

The financial outlay for the transaction at the date of this Annual Report amounts to zero; financial

payables include the amounts to be paid in 2023, totalling € 3,439 thousand.

No shares or similar instruments were issued, nor derivatives as acquisition cost items.

Fair value calculation of assets acquired and liabilities assumed

Here below are the details of the fair value of assets acquired and liabilities assumed and relating fair

value adjustments recognised on purchase price allocation:

237

Mondadori Group Consolidated Financial Statements at 31 December 2022


Amounts in Euro thousands	Notes	Current amounts at acquisition date	Purchase price allocation	Fair value

Goodwill		—	25	25
Trademarks		122	—	122
Other intangible assets		1,282	1,250	2,532
Intangible assets	I	1,404	1,275	2,679

Land and building		—	—	—
Plant and equipment		—	—	—
Other fixed assets		63	—	63
Property, plant and equipment		63	—	63
Rights-of Use-Assets		34	—	34
Deferred tax assets	II	60	—	60
Total non-current assets		1,561	1,275	2,836

Tax receivables		435	—	435
Other current assets		629	—	629
Inventory		2,410	—	2,410
Trade receivables		4,098	—	4,098
Other current financial assets		268	—	268
Cash and cash equivalents		516	—	516
Total current assets		8,356	—	8,356
Assets held for sale		—	—	—
Total assets		9,917	1,275	11,192

Provisions		304	—	304
Post-employment benefits		642	—	642
Deferred tax liabilities	II	16	349	365
Non-current financial liabilities IFRS 16		18	—	18
Total non-current liabilities		980	349	1,329

Income tax payables		3	—	3
Other current liabilities		883	—	883
Trade payables		2,696	—	2,696
Payables to banks and other financial liabilities		313	—	313
Financial liabilities IFRS 16		16	—	16
Total current liabilities		3,911	—	3,911
Liabilities held for sale		—	—	—
Total liabilities		4,891	349	5,240

Net assets acquired (50% share)		2,513	926	3,439
Price paid		(3,439)	—	(3,439)
Difference to allocate		(926)	926	—

The fair value of assets acquired and liabilities assumed was calculated as follows:

I - Intangible assets

The fair value of the item "Other intangible assets" is represented by the value attributed to the

customer portfolio, whose useful life has been defined as four years.

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2022 ANNUAL FINANCIAL REPORT

Goodwill was determined as the residual value of the difference between the cost of the transaction

and equity acquired, after representing all assets and liabilities from the transaction at fair value.

Values assigned by the Directors to the customer portfolio and goodwill were confirmed by the

assessment specifically performed by an independent consultant.

II - Pre-paid tax assets and deferred tax liabilities

The determination of the fair value of assets acquired and liabilities assumed resulted in the

recognition of temporary differences between their fair value and the corresponding tax value.

Tax liabilities were therefore recognised from the recognition of the fair value of the customer

portfolio.

Other information

The operating and financial effects of the acquisition of De Agostini Libri S.r.l., under IFRS 3, reflected

in the consolidated financial statements of the Mondadori Group from the acquisition date, concurrent

to the acquisition of control over the acquired company.

In accordance with IFRS 3, a final accounting of the acquisition was made.

Acquisition of the stake in Edizioni Star Comics S.r.l.

The transaction

On 30 June 2022, the Mondadori Group finalised the acquisition of 51% of Edizioni Star Comics S.r.l.,

with legal effect from 1 July.

As a result of this acquisition, Mondadori achieved a leading position in the national comics market,

with a market share of around 30%.

The consideration for the acquisition of 51% of the share capital of Edizioni Star Comics S.r.l., including

the price adjustment resulting from the final net financial position as at 30 June 2022, was € 14,629

thousand.

The share purchase agreement provides for two call / put options in favour of Mondadori / the sellers,

for the transfer of ownership of 24.5% of the shares each, to be exercised after the approval of the

financial statements for the financial years 2024 and 2027.

At the date of these financial statements, Mondadori estimated the value of the options, based on

available prospective data, and recognised total financial payables of € 13,112 thousand, taking into

account the impact of discounting.

The transaction is classified as a business combination under IFRS 3, which requires the acquirer to

allocate the cost by measuring the fair value of all assets, liabilities and contingent liabilities in order to

meet the recognition criteria at the acquisition date.

Cost of acquisition

The cost of the acquisition was € 27,741 thousand, net of the costs incurred for the transaction of €

582 thousand:

239

Mondadori Group Consolidated Financial Statements at 31 December 2022


Acquisition of Edizioni Star Comics S.r.l.
(Euro/thousands)

Cost of acquisition of 100% of Edizioni Star Comics S.r.l.		27,741

Cash used for acquisition: payments made deferred payments
payments made		(14,629)
payments deferred		(13,112)
liquidity of Edizioni Star Comics S.r.l.		(2,139)

Net cash flows absorbed by acquisition		(29,880)

The acquisition of 51% of the share capital of Edizioni Star Comics S.r.l. was settled on 30 June 2022,

through a payment order made by the acquiring company Mondadori Libri S.p.A., for € 14,280

thousand, supplemented in the following weeks by a price adjustment of € 349 thousand.

The value of the deferred payments represent the estimated outlay that Mondadori will have to bear

on the date of exercise of the options entitling it to purchase the remaining 49%.

No shares or similar instruments were issued, nor derivatives as acquisition cost items.

The transaction was financed by the parent company, Arnoldo Mondadori Editore S.p.A., with the

funds available at the closing date.

Fair value calculation of assets acquired and liabilities assumed

Here below are the details of the fair value of assets acquired and liabilities assumed and relating fair

value adjustments recognised on purchase price allocation.

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2022 ANNUAL FINANCIAL REPORT


Amounts in Euro thousands	Notes	Current amounts at acquisition date	Purchase price allocation	Fair value

Goodwill		84	4,321	4,405
Trademarks		5	12,500	12,505
Other intangible assets		74	12,000	12,074
Intangible assets	I	163	28,821	28,984
Investment property		-	-	—

Land and building		-	-	—
Plant and equipment		248	-	248
Other fixed assets		111	-	111
Property, plant and equipment		359	—	359
Assets from rights of use		697	-	697
Total investments		-	-	—
Deferred tax assets	II	78	-	78
Total non-current assets		1,297	28,821	30,118

Tax receivables		1	-	1
Other current assets		716	-	716
Inventory		8,294	-	8,294
Trade receivables		5,993	-	5,993
Other current financial assets		—	-	—
Cash and cash equivalents		56	-	56
Total current assets		15,060	—	15,060
Discontinued or discontinuing operations		-	-	-
Total assets		16,357	28,821	45,178

Provisions		—	-	—
Post-employment benefits		147	-	147
Non-current financial liabilities		56	-	56
Financial liabilities IFRS 16		602	-	602
Deferred tax liabilities	II	4	6,835	6,839
Total non-current liabilities		809	6,835	7,644

Income tax payables		—	-	—
Other current liabilities		3,389	-	3,389
Trade payables		4,867	-	4,867
Payables to banks and other financial liabilities		1,442	-	1,442
Financial liabilities IFRS 16		95	-	95
Total current liabilities		9,793	—	9,793
Liabilities disposed or being disposed of		-	-	-
Total liabilities		10,602	6,835	17,437

Net acquired assets		5,755	21,986	27,741
Price paid		(27,741)	-	(27,741)
Difference to allocate		(21,986)	21,986	—

The fair value of assets acquired and liabilities assumed was calculated as follows:

241

Mondadori Group Consolidated Financial Statements at 31 December 2022

I - Intangible assets

The fair value of the item “trademarks” is represented by the value attributed to the Star Comics

trademark, owned by the publishing house, under which comic books have been published for over

thirty years and with which the Company has become a market leader.

The life of the trademark has been classified as indefinite.

The fair value of other intangible assets refers to the right to exploit publishing content licensed to the

publishing house on the basis of specific contracts; the useful life of these rights has been classified as

finite and the relative value is amortised over ten years, taking into account the average historical

duration of the contracts themselves.

Goodwill was determined as the residual value of the difference between the cost of the transaction

and equity acquired, after representing all assets and liabilities from the transaction at fair value.

The values attributed by the Directors to publishing trademarks, other intangible assets and goodwill

were confirmed by the assessment specifically performed by an independent consultant.

II - Pre-paid tax assets and deferred tax liabilities

The determination of the fair value of assets acquired and liabilities assumed resulted in the

recognition of temporary differences between their fair value and the corresponding tax value.

Tax liabilities were therefore recognised in connection with the fair value recognition of publishing

trademarks and publishing content rights.

Other information

The operating and financial effects of the acquisition of Edizioni Star Comics S.r.l., under IFRS 3,

reflected in the consolidated financial statements of the Mondadori Group from the acquisition date,

concurrent to the acquisition of control over the acquired company.

In accordance with IFRS 3, a final accounting of the acquisition was made.

9. NON-RECURRING INCOME AND EXPENSE

As required by CONSOB resolution no. 15519 of 27 July 2006, any income and expense deriving from

non-recurring transactions are recognised in the income statement.

Transactions and events are considered non-recurring when, by nature, they do not occur repeatedly

during normal business operations.

The relevant effects were outlined in a separate table in these “Explanatory notes to the financial

statements”.

10. IFRS 5

On 22 November, Mondadori exercised the option to sell the print and digital publishing activities of

the titles Grazia and Icon as well as the relative international network, and consequently signed the

relative contract with Reworld Media S.A..

The transaction, the completion of which was subject to the results of the verification procedure,

pursuant to Legislative Decree 21/2012 by the Offices of the Presidency of the Council of Ministers,

which obtained approval on 15 December 2022, is structured through the transfer of the business unit

being sold to a newly incorporated company that Reworld Media acquired in early January 2023.

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2022 ANNUAL FINANCIAL REPORT

The transaction falls into the repositioning strategy pursued by the Group and aimed at consolidating

its leadership in the books sector.

The Directors considered that all the requirements of international accounting standards for

representing transactions as discontinued operations had been met.

Pursuant to IFRS 5, the balance sheet values of the aforementioned business units, as at 31 December

2022, and, for the sake of fair comparison, as at 31 December 2021, have been restated between

“Assets disposed of or being disposed of” and “Liabilities disposed of or being disposed of”; the

balance sheet tables, for the year 2021, also include the values for Press-Di Distribuzione e Multimedia

S.r.l., which was subject to discontinuing operations on that date.


Assets/liabilities held for sale	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Intangible assets	8	21
Investment property	—	—
Property, plant and equipment	16	16
Assets from rights of use	—	—
Investments	—	—
Non-current financial assets	—
Deferred tax assets	—	—
Other non-current assets
Total non-current assets	24	37

Tax receivables	—	—
Other current assets	175	147
Inventory	103	97
Trade receivables	—	—
Other current financial assets	857	847
Cash and cash equivalents		—
Total current assets	1,135	1,091
Discontinued or discontinuing operations	1,159	1,128

Provisions	—	—
Post-employment benefits	259	259
Non-current financial liabilities	—	—
Financial liabilities IFRS 16	—	—
Deferred tax liabilities	—	—
Other non-current liabilities	—	—
Total non-current liabilities	259	259

Income tax payables	—	—
Other current liabilities	396	380
Trade payables	—	—
Payables to banks and other financial liabilities	—	—
Financial liabilities IFRS 16	—	—
Total current liabilities	396	380
Liabilities held for sale	655	639

243

Mondadori Group Consolidated Financial Statements at 31 December 2022

11. IMPAIRMENT PROCESS

When preparing the consolidated financial statements for the year ending 31 December 2022,

particular attention was paid to observing any impairment indicators, including in relation to the

international geo-political context, which has led to tensions in the financial markets, resulting in an

increase in inflation and, consequently, in the repeated increase in interest rates on the part of the

European Central Bank and other international institutions that govern the monetary policy of the

various countries.

Against this backdrop, the Mondadori share price at 30 December 2022 stood at € 1.81 (€ 2.04 at 30

December 2021). As a result of the price trend, the value expressed by the stock market capitalisation

decreased, but remained well above the value of booked equity.

Market capitalization at the end of the year stood at € 473 million, and consolidated equity at € 260.8

million.

Pursuant to IAS 36, assets with indefinite useful life and goodwill are not subject to amortisation, but to

an impairment test of the book value at least once a year or whenever there are indications of

impairment.

Assets with finite useful life are subject to amortisation, according to the useful life of each asset, and

upon closing assets items are subject to impairment test to verify whether any impairment loss has

occurred. An impairment test is only performed if these indicators are present.

The impairment testing process includes, among others:

•the identification of individual assets or the smallest Cash Generating Unit that generates

independent cash flows;

•assessment of the carrying amount of the CGUs by determining their recoverable value, equal to the

higher of fair value, less costs to sell, and value in use determined on the basis of the cash flow

projections deriving from the most recent financial plans approved by the Board of Directors.

Identification of Cash Generating Units

CGUs have been identified as assets that generate independent cash flows from their ongoing use,

consistent with the Group's organizational and business structure.

Taking account of the above, the table below provides details of the assets subject to impairment

testing and the related amounts recorded at 31 December 2022 in the balance sheet assets, as well

as their relating CGUs. These amounts are shown net of amortisation and impairment losses recorded

during the year.

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2022 ANNUAL FINANCIAL REPORT


Cash Generating Unit	Magazines	Trademarks and series	Others	Goodwill	Total
(Euro/thousands)	Magazines	Trademarks and series	Others	Goodwill	Total

CGU magazines former SBE	38,310				38,310
CGU magazine former Elemond	715				715
CGU former Gruner+Jahr Mondadori		1,791			1,791
Digital CGU		5,436		23,865	29,301
Hej! CGU				6,178	6,178
Rizzoli Trade CGU		4,005		1,634	5,639
Einaudi CGU		2,991		286	3,277
Sperling & Kupfer CGU		1,847		731	2,578
Piemme CGU		8,287		3,066	11,353
Star Comics CGU		12,500		4,405	16,905
Education CGU		52,483		114,005	166,488
Retail Stores CGU			25,757		25,757
Other CGUs		372		3,275	3,647
Investments			8,077		8,077


Total assets subject to impairment test	39,025	89,712	33,834	157,445	320,016

Cash Generating Unit titles former Silvio Berlusconi Editore (SBE)

The value of the titles, each of which represents a CGU, refers to the acquisition of Silvio Berlusconi

Editore, completed in 1994.

The titles included in the financial statements are TV Sorrisi e Canzoni, Chi and Telepiù, all of which

qualify as having finite useful life.

Cash Generating Unit title former Elemond

The value recorded in the financial statements is represented by Interni, a title with finite useful life,

resulting from the acquisition of the Elemond Group, which took place in several tranches between

1989 and 1994.

Cash Generating Unit former Gruner+Jahr Mondadori

The value recorded in the financial statements is represented by Focus, a brand with finite useful life,

resulting from the acquisition in 2015 of the control over the entire capital of Gruner+Jahr Mondadori

S.p.A. (now Mondadori Scienza S.p.A.), previously held 50% by the Mondadori Group.

Digital Cash Generating Unit

The value recorded in the financial statements is represented by trademarks and goodwill, resulting

from the acquisition of 100% of Banzai Media Holding S.p.A. in 2016. Assets identified in the purchase

price allocation, except for goodwill, have been qualified as having finite useful life.

Hej! Cash Generating Unit

In January 2021, the Mondadori Group acquired 100% control of the share capital of Hej! S.r.l., a

company specialising in AI solutions to companies to create customer relationships, marketing plans

and media campaigns.

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Mondadori Group Consolidated Financial Statements at 31 December 2022

On conclusion of the purchase price allocation process, the higher price paid was allocated to

proprietary software, the customer database and, residually, to goodwill. Assets identified in the

purchase price allocation, except for goodwill, have been qualified as having finite useful life.

Rizzoli Trade Cash Generating Unit

The CGU includes the BUR trademark and goodwill determined on conclusion of the purchase price

allocation process carried out with regard to the acquisition of Rizzoli Libri S.p.A. in 2016. The assets

identified in the purchase price allocation have been qualified as having indefinite useful life.

Einaudi Cash Generating Unit

This CGU includes the publishing series of Casa Editrice Einaudi, acquired in several tranches

between 1989 and 1994; these assets qualify as having indefinite useful life.

Sperling & Kupfer Cash Generating Unit

This CGU includes the values attributed to the Sperling & Kupfer publishing series, and, residually, to

goodwill, as a result of the purchase price allocation process carried out in 1995. These assets qualify

as having indefinite useful life.

Piemme Cash Generating Unit

This CGU includes Casa Editrice Edizioni Piemme publishing trademarks, acquired in more than one

tranche between 2003 and 2012, qualified as assets with an indefinite useful life, and residual

goodwill.

Star Comics Cash Generating Unit

In July 2022, the Mondadori Group acquired 51% of the share capital of Edizioni Star Comics S.r.l., a

company specialising in the publication of comic books.

On conclusion of the purchase price allocation process, the higher price paid was allocated to

trademarks, proprietary software and, residually, to goodwill. Assets identified in the purchase price

allocation, except for trademarks and goodwill, have been qualified as having finite useful life.

Education Cash Generating Unit

This CGU group includes series and publishing lines referring to the production of textbooks for the

different levels and grades of the Italian school system. These include the amounts deriving from

various acquisitions completed over time: the acquisition of a number of publishing trademarks from

the Elemond Group between 1989 and 1994, the acquisition of the Le Monnier Group between 1999

and 2001, and the acquisition of Texto, a textbook publisher under the Piemme Scuola trademark, in

2004. Goodwill deriving from the abovementioned transactions and from other acquisitions completed

in 1992 (Juvenilia), between 1999 and 2002 (Poseidonia), in 1999 (Mursia) and in 2008 (Edizioni Electa

Bruno Mondadori) add up to the above amounts.

The Education CGU group includes the amounts attributed to the Rizzoli Education trademarks

acquired in 2016.

Finally, the Education CGU group also includes the amounts attributed to trademarks and goodwill of

D Scuola S.p.A., acquired in 2021.

Cash Generating Unit Retail Stores

These CGUs include the assets related to the stores directly managed by Mondadori Retail S.p.A..

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2022 ANNUAL FINANCIAL REPORT

Other Cash Generating Units

This group of CGUs includes mainly:

•the value of the bookclub member database of former Mondolibri S.p.A., amounting to € 2,500

thousand;

•the Grazia Cina trademark, regarding the local publication of the weekly, amounting to € 365

thousand;

•goodwill of Skira Rizzoli, amounting to € 443 thousand;

•goodwill from the acquisition of Abscondita S.r.l., amounting to € 254 thousand.

Cash Generating Unit Investments

These CGUs include the goodwill identified on acquisition of the investment in the Attica Publications

S.A. Group, in the A.L.I.-Agenzia Libraria Internazionale S.r.l. group and, for a residual amount, in

Società Europea di Edizioni S.p.A..

Assessment of the recoverable value

The carrying amount of the CGUs is assessed by determining their recoverable value, which is the

higher of value in use and fair value, less costs to sell.

With regard to the CGUs measured through value in use, the impairment test was based on the

projection of cash flows deriving from the Medium-Term Plan, drawn up for the years 2023-2025, in

relation to which the Board of Directors reviewed the guidelines and approved the contents on 16

February 2023.

The table shows the criteria used in the valuation of the recoverable value of the various CGUs, as

well as the main elements for assessing their recoverable value.

247

Mondadori Group Consolidated Financial Statements at 31 December 2022


Cash Generating Unit	Criterion used	Economics	Growth rate on terminal value	Discount rate
CGU magazines former SBE	Value in use / Fair value	MOL 2023-2025 Ricavi 2023-2025	g = -3%; g = -5%	9,03%
CGU magazine former Elemond	Fair value	Ricavi 2023-2025	g = -5%	9,03%
CGU former Gruner+Jahr Mondadori	Fair value	Ricavi 2023-2025	g = -5%	9,03%
Digital CGU	Value in use	MOL 2023-2025	g = 0%; g = 2%	9,03%
Hej! CGU	Value in use	Cash flow 2023-2025	g = 0%	9,03%

Rizzoli Trade CGU	Value in use	MOL 2023-2025	g = 0%	8,50%
Einaudi CGU	Value in use	Cash flow 2023-2025	g = 0%	8,50%
Sperling & Kupfer CGU	Value in use	MOL 2023-2025	g = 0%	8,50%
Piemme CGU	Value in use	MOL 2023-2025	g = 0%	8,50%
Education CGU	Value in use	Cash flow 2023-2025	g = 0%	8,50%
Star Comics CGU	Value in use	Cash flow 2023-2025	g = 0%	8,50%

Retail Stores CGU	Value in use	MOL 2023-2025	g = 0%	8,50%

Other CGUs	Value in use	MOL 2023-2025	g = 0%	8,50%

Investments	Value in use / Fair value	MOL 2023-2027 Transazione di mercato	g = 0%	10,90%

Specifically, when performing the impairment test:

•with regard to the titles former SBE, titles former Elemond and former Gruner+Jahr Mondadori CGUs,

respectively for the magazines Chi, Interni and Focus, fair value was determined by applying the

royalty method, based on estimated revenue in the medium-term forecast scenarios. Royalty rates

between 3% and 5%, drawn from a panel of international licensing agreements, were used; the

estimated growth rate (g) for the period following the explicit years of the Medium-Term Plan is -5%;

•the value in use of Tv Sorrisi e Canzoni and Telepiù was determined on the basis of the income

statements of each title, including structural and maintenance costs, which are deemed to be

representative of the related cash flows. The growth rates (g), estimated for the period following the

explicit years of the Medium-Term Plan, are -3% and -5%, respectively;

•with regard to the Digital CGU, which includes mainly digital brands and the goodwill thereto, the

value in use was determined on the basis of the income statements of the various digital brands,

which are deemed to be representative of the related cash flows. The growth rate (g), estimated for

the period following the explicit years of the Medium-Term Plan, ranges between 0% and 2%;

•with regard to the Hej! CGU, the entire legal entity was considered as cash generating unit for the

purposes of the impairment test, attributing also goodwill arising at the time of acquisition. The value

in use was determined on the basis of the cash flows of the company. The growth rate (g), estimated

for the period following the explicit years of the Medium-Term Plan, is 0%;

•with regard to the Einaudi, Education (Mondadori Education, Rizzoli Education and D Scuola) and

Starcomics CGUs for the purposes of the impairment test, all the legal entities were considered as

cash generating units, also attributing goodwill arising from the acquisitions. The value in use was

determined on the basis of the cash flows of the respective companies. The growth rate (g),

estimated for the period following the explicit years of the Medium-Term Plan, is 0%;

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2022 ANNUAL FINANCIAL REPORT

•with regard to the Rizzoli Trade, Sperling & Kupfer and Piemme CGUs, the assets of which fall under

Mondadori Libri S.p.A., the value in use was determined on the basis of the income statements of the

CGUs in question, including the structural and maintenance costs of the trademarks/series in

question. The growth rate (g), estimated for the period following the explicit years of the Medium-

Term Plan, is 0%;

•with regard to the Retail Stores CGUs, the value in use was determined on the basis of cash flow

projections drawn from the forecast long-term income statements of the single stores. The growth

rate (g), estimated for the period following the explicit years of the Medium-Term Plan, is 0%;

•with regard to the other CGUs, the recoverable value was determined mainly on the basis of value in

use, taking account of the income statements, including structural and maintenance costs of the

assets subject to impairment. The growth rate (g), estimated for the period following the explicit

years of the Medium-Term Plan, is 0%;

With respect to Investments:

•with regard to the Attica Publications S.A. Group, the value in use was determined on the basis of

cash flow projections drawn from the long-term plans;

•with regard to Società Europea di Edizioni S.p.A., in which the Group holds an 18.445% stake, the fair

value was determined on the basis of the transaction, involving the sale by Mondadori of 18.445% of

Società Europea di Edizioni S.p.A.;

•for the A.L.I. Group, of which the Group holds 50%, the value in use was defined with reference to

the cash flows contained in the Medium-Term Plan. The growth rate (g) estimated for the period

following the explicit years of the Medium-Term Plan is 0%.

In addition to assessing the recoverability of the above CGUs, an analysis was also made of the

Group's assets as a whole. The results of the analysis showed no impairment.

Determination of the discount rate

The discount rate was defined in terms of weighted average cost of capital (WACC) for the individual

Cash Generating Unit/Country taken into account and shown net of tax, consistently with the flows

used.

WACC is an adjusted risk rate, measured on the basis of the cost that the company must bear to

collect resources from lending entities, internal and external, to finance any specific investment.

WACC expresses an opportunity cost of capital and is calculated as the weighted average of the cost

of the risk capital and the cost of the debt capital.

The individual parameters used in the determination of WACC are the following:

•cost of equity (ke) is quantified based on the model of CAPM (Capital Asset Pricing Model) as

requested in IAS 36, as the sum of: (i) the return on risk-free investments, (ii) a risk premium

determined on the basis of the systematic riskiness of the investment being valued and (iii) an

additional premium correlated to the dimensional risk. In particular:

–the risk-free rate was determined taking account of the yield to maturity for the securities of the

Countries to which the Cash Generating Units are referred, taking account of the annual average;

–the risk premium was determined through the product resulting from the beta coefficient and the

difference between the market performance (mp) and risk-free rate (equity risk premium),

determined taking account of a sufficiently large time horizon.

Specifically, the beta coefficient was calculated by considering the normalized average of market

unlevered betas of a panel of comparable companies, distinguishing the book publishing

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Mondadori Group Consolidated Financial Statements at 31 December 2022

business from the magazine publishing business, in order to intercept the different systematic

risk. With regard to the equity risk premium, reference was made to the equity risk component for

AAA Countries (5.11%) and the country risk premium component (1.86% for Italy and 3.91% for

Greece); both figures were drawn from the estimates published by Damodaran in January 2023;

•the calculation of the Cost of Debt (kd) is based on the analysis of the specific financial structure of

the Group;

•the weight attributed to equity and non-controlling interests’ equity was calculated based on the

normalized average of a panel of comparable companies.

Results of the impairment test

The results of the impairment test required the write down of:

•the magazines TV Sorrisi e Canzoni and Telepiù, for a total of € 6.7 million;

•the Focus trademark for € 0.3 million;

•certain Digital Area sites for a total of € 0.2 million;

•The value of the investment in Attica Publications S.A. for € 1.7 million.

Sensitivity to changes in the assumptions

For the amounts relating to the CGUs indicating no impairment loss, sensitivity analyses were carried

out to corroborate the results of the test, increasing the discount rate by 0.5% and reducing the cash

flows by 5%, while maintaining the other assumptions unchanged.

The analysis confirmed that the results obtained are reasonable and, consequently, confirmed the

recoverability of the book values recognised in these financial statements, while stressing the need,

however, to oversee the performance of each CGU in order to verify the consistency of final and

forecast trends, taking account of the current market context.

12. INTANGIBLE ASSETS

"Intangible assets", amounting to € 372,297 thousand, increased by € 20,453 thousand versus 31

December 2021, due mainly to the acquisitions referred to in Note 8.


Intangible assets	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Intangible assets with a finite useful life	132,681	129,190
Intangible assets with indefinite useful life	239,616	222,654

Total intangible assets	372,297	351,844

“Intangible assets with finite useful life", amounting to € 132,681 thousand, up versus € 129,190

thousand at 31 December 2021, includes the values of magazine titles, trademarks and websites and

digital platforms relating to the Media Area.

In “Cost of development" and "Other assets, assets in progress and advances", the most significant

amounts are represented by costs incurred in the school textbooks segment for the creation of new

publishing projects.

250

2022 ANNUAL FINANCIAL REPORT


Intangible assets with a finite useful life	Magazines	Trademarks	Customer lists	Software, licenses, patents and rights	Develop ment costs	Other assets, assets in progress and advances	Total
(Euro/thousands)	Magazines	Trademarks	Customer lists	Software, licenses, patents and rights	Develop ment costs	Other assets, assets in progress and advances	Total

Historic cost at 31 December 2020	94,114	20,232	1,684	28,563	50,205	8,943	203,741
Investments	—	—	—	2,580	7,276	7,744	17,600
Disposals	—	—	—	(1,107)	(13,723)	—	(14,830)
Change in scope	—	8,135	611	34,685	63,162	—	106,593
Other changes	(3,749)	—	(1,684)	(327)	(4,460)	(3,912)	(14,132)
Historic cost at 31 December 2021	90,365	28,367	611	64,394	102,460	12,775	298,972

Accumulated amortisation and impairment losses at 31/12/2020	39,363	9,878	1,684	18,423	37,946	2,675	109,969
Depreciation and amortisation	3,102	933	153	4,951	11,591	283	21,013
Write-downs (write-backs)	2,955	561	—	6	128	—	3,650
Disposals	—	—	—	(1,107)	(13,723)	—	(14,830)
Change in scope	—	4,138	—	3,558	56,407	—	64,103
Other changes	(3,749)	—	(1,684)	(549)	(8,279)	138	(14,123)

Accumulated amortisation and impairment losses at 31/12/2021	41,671	15,510	153	25,282	84,070	3,096	169,782

Net value at 31/12/2020	54,751	10,354	—	10,140	12,259	6,268	93,772
Net value at 31/12/2021	48,694	12,857	458	39,112	18,390	9,679	129,190

In 2022, in addition to the investments made by the companies belonging to the Group's historical

scope, among which the most significant amounts concern the costs for the creation of new

publications in the school textbook sector (€ 11,145 thousand recognised under "Development costs"

and € 9,175 thousand recognised under "Assets in progress"), the most significant changes concern

the acquisitions of De Agostini Libri S.r.l. and Edizioni Star Comics S.r.l..

In particular, at the conclusion of the purchase price allocation process, conducted with the support of

an external professional:

•a value of € 1,250 thousand was allocated to the customer portfolio of Libromania S.r.l., a company

acquired together with De Agostini Libri S.r.l.;

•a value of € 12,000 thousand was allocated to the portfolio of licensing contracts of Edizioni Star

Comics S.r.l..

The two acquired companies also contributed a net value of intangible assets with a finite life of €

1,551 thousand represented mainly by licence agreements for the De Agostini and Utet trademarks for

De Agostini Libri S.r.l. publications.

251

Mondadori Group Consolidated Financial Statements at 31 December 2022

As a result of the impairment test, described in Note 11, it was necessary to adjust the value of certain

publications (€ 6,730 thousand) and certain trademarks and websites (€ 489 thousand) of the Media

Area; the write-downs of development costs are related to certain school textbook titles that will not

be published.


Intangible assets with a finite useful life	Magazines	Trademarks	Customer lists	Software, licenses, patents and rights	Develo pment costs	Other assets, assets in progress and advances	Total
(Euro/thousands)	Magazines	Trademarks	Customer lists	Software, licenses, patents and rights	Develo pment costs	Other assets, assets in progress and advances	Total

Historic cost at 31 December 2021	90,365	28,367	611	64,394	102,460	12,775	298,972
Investments	—	—	1,250	15,969	12,850	10,451	40,520
Disposals	—	—	—	(222)	(159)	—	(381)
Change in scope	—	1,431		494	851	60	2,836
Other changes		(24)		(953)	(41,132)	(5,972)	(48,081)

Historic cost at 31 December 2022	90,365	29,774	1,861	79,682	74,870	17,314	293,866

Accumulated amortisation and impairment losses at 31/12/2021	41,671	15,510	153	25,282	84,070	3,096	169,782
Depreciation and amortisation	2,910	1,390	387	9,028	17,734	463	31,912
Write-downs (write-backs)	6,730	489	—		156	—	7,375
Disposals	—		—	(222)	(159)	—	(381)
Change in scope	—		—	381	180	17	578
Other changes		(19)	—	(1,617)	(46,559)	114	(48,081)

Accumulated amortisation and impairment losses at 31/12/2022	51,311	17,370	540	32,852	55,422	3,690	161,185

Net value at 31/12/2021	48,694	12,857	458	39,112	18,390	9,679	129,190
Net value at 31/12/2022	39,054	12,404	1,321	46,830	19,448	13,624	132,681

“Intangible assets with indefinite useful life" amounted to € 239,616 thousand, an increase of € 16,962

thousand, and included the value of trademarks and publishing series in the Books Area and goodwill.

252

2022 ANNUAL FINANCIAL REPORT


Intangible assets with indefinite useful life	Magazines	Trademarks and series	Goodwill	Total
(Euro/thousands)	Magazines	Trademarks and series	Goodwill	Total

Historic cost at 31 December 2020	—	47,631	53,737	101,368
Investments	—	—	—	—
Disposals	—	—	—	—
Change in scope	—	23,001	108,141	131,142
Other changes	—	—	32	32
Historic cost at 31 December 2021	—	70,632	161,910	232,542

Impairment loss at 31/12/2020	—	994	6,810	7,804
Write-downs (write-backs)	—	—	2,084	2,084
Other changes/disposals	—	—	—	—
Impairment loss at 31/12/2021	—	994	8,894	9,888

Net value at 31/12/2020	—	46,637	46,927	93,564
Net value at 31/12/2021	—	69,638	153,016	222,654

Investments for the year are attributable to acquisitions completed in 2022.

At the conclusion of the Purchase Price Allocation process, the value of € 12,500 thousand was

attributed to the Star Comics brand and, after having accounted for deferred taxes on the values that

resulted from the Purchase Price Allocation, the value of goodwill resulting from the acquisitions of De

Agostini Libri S.r.l. and Edizioni Star Comics S.r.l. was recognised as a residual amount.

As a result of the impairment test, described in Note 11, it was necessary to adjust the value of

trademarks and goodwill for a total of € 43 thousand.

Other changes in the item "Goodwill" show the effect of the change in the euro-dollar exchange rate,

relating to Rizzoli International Publications Inc..


Intangible assets with indefinite useful life	Magazines	Trademarks and series	Goodwill	Total
(Euro/thousands)	Magazines	Trademarks and series	Goodwill	Total

Historic cost at 31 December 2021	—	70,632	161,910	232,542
Investments	—	12,500	4,346	16,846
Disposals	—	—	—	—
Change in scope	—	49	84	133
Other changes	—	(20)	26	6
Historic cost at 31 December 2022	—	83,161	166,366	249,527

Impairment loss at 31/12/2021	—	994	8,894	9,888
Write-downs (write-backs)	—	18	25	43
Other changes/disposals	—	(20)	—	(20)
Impairment loss at 31/12/2022	—	992	8,919	9,911

Net value at 31/12/2021	—	69,638	153,016	222,654
Net value at 31/12/2022	—	82,169	157,447	239,616

253

Mondadori Group Consolidated Financial Statements at 31 December 2022

Amortisation, write-downs and write-backs of intangible assets

Amortisation and write-downs for the year totalled € 39,330 thousand, up from € 26,748 thousand in

2021, due to higher amortisation resulting from the acquisitions completed in 2021 and 2022 and

higher write-downs as a result of the impairment process.


Amortisation and impairment loss on intangible assets	2022	2021
(Euro/thousands)	2022	2021

Magazines	2,910	3,102
Trademarks	1,390	933
Customer lists	387	153
Software, licenses, patents and rights	9,028	4,951
Development costs	17,734	11,591
Other intangible assets	463	283

Total amortisation of intangible assets	31,912	21,013

Write-downs of intangible assets	7,418	5,734
Write-backs of intangible assets	—	—
Total write-downs (write-backs) of intangible assets	7,418	5,734

Total amortisation and impairment loss on intangible assets	39,330	26,748

The availability and use of intangible assets recognised in these financial statements are not subject to any

lien or restriction.

13. PROPERTY, PLANT AND EQUIPMENT

The net amount of "Property, plant and equipment" at 31 December 2022 was € 24,133 thousand, up

versus € 14,593 thousand in the prior year.

The table below shows a breakdown of "Property, plant and equipment" in 2021 and 2022:

254

2022 ANNUAL FINANCIAL REPORT


Property, plant and equipment	Land	Instrumental buildings	Plant and equipment	Other tangible assets	Total
(Euro/thousands)	Land	Instrumental buildings	Plant and equipment	Other tangible assets	Total

Historic cost at 31 December 2020	903	5,605	22,746	59,721	88,976
Investments			976	4,524	5,500
Disposals	(903)	(5,488)	(2,609)	(3,415)	(12,416)
Change in scope			125	546	671
Other changes	—	—	124	(345)	(221)
Historic cost at 31 December 2021	—	117	21,362	61,031	82,510

Accumulated depreciation and impairment loss at 31/12/2020	—	4,204	20,074	47,766	72,044
Depreciation and amortisation		128	737	3,260	4,125
Write-downs (write-backs)			348	1,292	1,640
Disposals	—	(4,215)	(2,609)	(3,403)	(10,227)
Change in scope			111	483	594
Other changes	—	—	—	(259)	(259)
Accumulated depreciation and impairment loss at 31/12/2021	—	117	18,661	49,139	67,917

Net value at 31/12/2020	903	1,401	2,672	11,955	16,932
Net value at 31/12/2021	—	—	2,701	11,892	14,593

Capital expenditure in 2022, amounting to € 12,501 thousand, refers mostly to the costs incurred by

Mondadori Retail S.p.A. (€ 10,087 thousand), for site design, furnishings and leasehold improvements

related to the opening of new bookstores or the restyling of existing stores.

Costs incurred to equip staff with the most suitable tools for smart working and to secure company

networks amounted to a total of € 2,158 thousand.

In 2022, in addition to the annual depreciation charge of € 4,279 thousand, a write-down of tangible

assets and leasehold improvement costs of € 320 thousand was recorded, mainly attributable to the

Retail Area.

The companies acquired during the year contributed € 671 thousand to the increase in the net value

of tangible assets.

255

Mondadori Group Consolidated Financial Statements at 31 December 2022


Property, plant and equipment	Land	Instrumental buildings	Plant and equipment	Other tangible assets	Total
(Euro/thousands)	Land	Instrumental buildings	Plant and equipment	Other tangible assets	Total

Historic cost at 31 December 2021		117	21,362	61,031	82,510
Investments			1,123	11,378	12,501
Disposals		(117)	(420)	(1,468)	(2,005)
Change in scope			348	1,777	2,125
Other changes	—	—	13	(1,520)	(1,507)
Historic cost at 31 December 2022	—	—	22,426	71,198	93,624

Accumulated depreciation and impairment loss at 31/12/2021	—	117	18,661	49,139	67,917
Depreciation and amortisation		—	734	3,545	4,279
Write-downs (write-backs)			72	248	320
Disposals	—	(117)	(420)	(1,447)	(1,984)
Change in scope			100	366	466
Other changes	—	—	—	(1,507)	(1,507)
Accumulated depreciation and impairment loss at 31/12/2022	—	—	19,147	50,344	69,491

Net value at 31/12/2021	—	—	2,701	11,892	14,593
Net value at 31/12/2022	—	—	3,279	20,854	24,133

“Other fixed assets” is broken down as follows:


Other fixed assets	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Industrial and commercial equipment	97	117
Electronic office machinery	3,960	2,560
Office furniture, facilities and fittings	3,539	3,130
Motor and transport vehicles	6	16
Leasehold improvements	5,342	5,059
Other tangible assets and advances	7,910	1,011

Total other tangible assets	20,854	11,892

Depreciation of property, plant and equipment

Amortisation, depreciation and write-downs for the year totalled € 4,599 thousand, down from €

5,765 thousand in 2021, which included the write-down of furniture, fixtures and costs incurred on

third-party assets, related to the Piazza Duomo store in Milan.

256

2022 ANNUAL FINANCIAL REPORT


Depreciation and impairment loss on property, plant and equipment	2022	2021
(Euro/thousands)	2022	2021

Buildings	—	128
Plant and equipment	734	737
Equipment	63	70
Electronic office machinery	1,531	1,143
Furniture and furnishings	730	752
Motor and transport vehicles	9	9
Leasehold improvements	1,208	1,286
Other tangible assets	4

Total depreciation of property, plant and equipment	4,279	4,125

Write-downs of tangible assets	320	1,640
Write-backs of tangible assets	—	—

Total write-downs (write-backs) of property, plant and equipment	320	1,640

Total depreciation and impairment loss on tangible assets	4,599	5,765

14. ASSETS FROM RIGHTS OF USE

Assets from rights of use, recorded in accordance with IFRS 16, amounted to € 68,453 thousand, a

decrease of € 12,274 thousand compared to 31 December 2021, mainly due to the effect of:

•the signing of the new lease agreement for the Segrate office; following the termination of the old

contract, an IFRS 16 financial income of € 1,390 thousand was recognised under financial expense

(income);

•the termination of the lease agreement for the Milan office of D Scuola S.p.A., due to the transfer of

staff to the Segrate office.


Assets from rights of use	Rights of use buildings	Rights of use motor vehicles	Rights of use hardware	Rights of use in progress	Total
(Euro/thousands)	Rights of use buildings	Rights of use motor vehicles	Rights of use hardware	Rights of use in progress	Total

Historic cost at 31 December 2020	103,139	991	1,306		105,436
Investments	12,835	240	—	2,132	15,206
Disposals	(7,605)	—	—	—	(7,605)
Other changes	3,674	196	—	—	3,870
Historic cost at 31 December 2021	112,044	1,427	1,306	2,132	116,908

Amortisation fund at 31 December 2020	24,504	450	278	—	25,232
Depreciation and amortisation	12,834	336	257	—	13,427
Disposals	(3,626)	—	—	—	(3,626)
Other changes	1,087	62	—	—	1,149
Amortisation fund at 31 December 2021	34,799	848	535	—	36,183

Net value at 31/12/2020	78,635	541	1,028	—	80,204
Net value at 31/12/2021	77,244	579	771	2,132	80,725

257

Mondadori Group Consolidated Financial Statements at 31 December 2022


Assets from rights of use	Rights of use buildings	Rights of use motor vehicles	Rights of use hardware	Rights of use in progress	Total
(Euro/thousands)	Rights of use buildings	Rights of use motor vehicles	Rights of use hardware	Rights of use in progress	Total

Historic cost at 31 December 2021	112,044	1,427	1,306	2,132	116,909
Investments	39,543	384	—	—	39,927
Disposals	(5,398)	—	—	—	(5,398)
Other changes	(48,874)	—	—	(2,132)	(51,006)

Historic cost at 31 December 2022	97,315	1,811	1,306	—	100,432

Amortisation fund at 31 December 2021	34,801	848	535	—	36,185
Depreciation and amortisation	13,406	443	257	—	14,106
Disposals	(4,094)	—	—	—	(4,094)
Other changes	(14,218)	(15)	—	—	(14,219)

Amortisation fund at 31 December 2022	29,896	1,290	792	—	31,979

Net value at 31/12/2021	77,244	579	771	2,132	80,725
Net value at 31/12/2022	67,419	520	514	—	68,453

15. INVESTMENTS

“Equity-accounted investees" and "Investments in other companies" amounting to € 29,748 thousand,

up by € 11,014 thousand.


Investments	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Investments accounted for using the equity method	28,450	17,859
Investments in other companies	1,298	875

Total investments	29,748	18,734

During the year, the most significant changes were represented by the acquisition of A.L.I.- Agenzia

Libraria Internazionale S.r.l., the write-down of Attica Publications S.A. for € 1,679 thousand and the

sale of Monradio S.r.l., effective from 1 January 2022.

The results achieved by the investee companies were positive in the amount of € 1,199 thousand, plus

the income from the fair value assessment of the residual 20% share retained in Press-Di Distribuzione

Stampa e Multimedia S.r.l., in the amount of € 281 thousand, and the write-down of Attica Publications

S.A. in the amount of € 1,679 thousand; for further information, see Note 35.

In 2022 the Group received dividends amounting to € 1,289 thousand, distributed by Edizioni EL S.r.l.

And Digital Advertising & Engagement S.A..

258

2022 ANNUAL FINANCIAL REPORT


Equity-accounted investees - Details	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Investments in joint ventures:
- Edizioni EL S.r.l.	4,157	4,183
- Attica Publications Group	6,968	7,722
- Mediamond S.p.A.	2,390	1,683
- Mondadori Seec Advertising Co. Ltd	1,425	2,641
- A.L.I.-Agenzia Libraria Internazionale S.r.l.	12,447	—

Total investments in joint ventures	27,387	16,229

Investments in associates:
- Monradio S.r.l.	—	1,200
- Digital Advertising S.r.l.	471	430
- Press-Di Distribuzione Stampa Multimedia S.r.l.	592	—

Total investments in associates	1,063	1,630
Total equity-accounted investees	28,450	17,859

The value of "Investments in other companies", amounting to € 1,298 thousand, increased by € 423

thousand due to capital contributions made to Società Europea di Edizioni S.p.A., net of the loss for

the year.


Investments in other companies - Details	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Investments in other companies:
- Società Europea di Edizioni S.p.A.	1,038	614
- Società Editrice Il Mulino S.p.A.	197	197
- Consuledit S.r.l.	1	1
- Immobiliare Editori Giornali S.r.l.	52	52
- Consorzio Edicola Italiana	10	10

Total investments in other companies	1,298	875

259

Mondadori Group Consolidated Financial Statements at 31 December 2022

16. PRE-PAID TAX ASSETS AND DEFERRED TAX LIABILITIES

“Pre-paid tax assets", amounting to € 67,878 thousand, and "Deferred tax liabilities", amounting to €

42,255 thousand, respectively decreased by € 3,606 thousand and increased by € 6,382 thousand.


(Euro/thousands)	31/12/2022	31/12/2021

IRES on tax losses	1,754	3,399
Pre-paid IRES	60,781	62,883
Pre-paid IRAP	5,343	5,202

Total pre-paid tax assets	67,878	71,484

Deferred IRES	37,069	31,115
Deferred IRAP	5,187	4,758

Total deferred tax liabilities	42,255	35,873

The decrease in the value of “Pre-paid tax assets" was due to:

•to the consumption of previous tax losses by Rizzoli Education S.p.A. for € 1,645 thousand;

•the development of taxed provisions and other temporary differences affecting the various Group

companies.

The Directors believe that the amounts recognised are fully recoverable, considering:

•the possibility of a pre-deduction of up to 80% of the Group's prior-years’ tax losses from taxable

income, in accordance with the agreement governing relations with the consolidating entity Fininvest

S.p.A.;

•the right to carry forward tax losses without time restrictions;

•the performance estimates contained in the 2023-2025 Medium-Term Plan, which was approved by

the Board of Directors on 16 February 2023.

260

2022 ANNUAL FINANCIAL REPORT

Components that led to the recognition of pre-paid tax


(Euro/thousands)	31/12/2022			31/12/2021
(Euro/thousands)	Amount	Current tax rate	Prepaid tax assets	Amount	Current tax rate	Prepaid tax assets

Difference between book value and tax value of intangible assets	11,084	(*)	2,659	13,073	(*)	3,138
Difference between book value and tax value of investment property and investments in property, plant and equipment	1,495	(*)	359	1,253	(*)	301
Provision for bad debts	17,327	(*)	4,184	14,716	(*)	3,556
Write-down of inventory	33,807	(*)	8,149	31,997	(*)	7,713
Write-down of advances to authors	54,043	(*)	12,983	49,569	(*)	11,909
Provisions	43,428	(*)	10,423	53,697	(*)	12,887
Post-employment benefits	803	(*)	193	3,213	(*)	771
Elimination of intercompany income	7,325	(*)	1,758	7,392	(*)	1,774
Returns to receive	32,215	(*)	7,732	31,368	(*)	7,528
Amendment rights to existing tax consolidation	45,904	(*)	11,018	48,778	(*)	11,707
Other temporary differences	4,698	(*)	1,164	6,490	(*)	1,599

Total for IRES purposes	252,793		60,781	261,547		62,883

Difference between book value and tax value of intangible assets	10,450	(*)	407	12,529	(*)	488
Difference between book value and tax value of investment property and investments in property, plant and equipment	302	(*)	12	313	(*)	12
Write-down of inventory	30,239	(*)	1,179	28,638	(*)	1,117
Write-down of advances to authors	52,422	(*)	2,045	48,094	(*)	1,876
Provisions	2,243	(*)	87	1,995	(*)	78
Post-employment benefits	1,123	(*)	44	2,380	(*)	93
Elimination of intercompany income	7,282	(*)	284	7,358	(*)	287
Returns to receive	32,215	(*)	1,257	31,368	(*)	1,223
Other temporary differences	715	(*)	28	730	(*)	29

Total for IRAP purposes	136,991		5,343	133,404		5,203
(*) With regard to income tax, each Group company applied the tax rate applicable in the country of residence. As for IRAP, each Group company applied the tax rate in force, taking into account the distribution of the tax base by region.

The increase in the value of "Deferred tax liabilities" is mainly determined by the combined effect:

•the recognition of assets at fair value, arising from the acquisition transactions of De Agostini Libri

S.r.l. and Edizioni Star Comics S.r.l., as a result of the purchase price allocation, not relevant for tax

purposes, which resulted in the recognition of deferred tax liabilities totalling € 7,185 thousand;

•the new temporary differences arising on the values of goodwill and trademarks with an indefinite

life, subject to the realignment between tax values and respective balance sheet values, realised in

2021 in accordance with the provisions of Article 110 of Decree-Law No. 104/2020;

•utilisation as a result of impairment losses recorded during the year, in the amount of € 2,014

thousand.

261

Mondadori Group Consolidated Financial Statements at 31 December 2022

Components that led to the recognition of deferred tax


(Euro/thousands)	31/12/2022			31/12/2021
(Euro/thousands)	Amount	Current tax rate	Prepaid tax assets	Amount	Current tax rate	Prepaid tax assets

Difference between book value and tax value of intangible assets	132,604	(*)	31,826	121,800	(*)	29,232
Difference between book value and tax value of investment property and investments in property, plant and equipment	—	(*)	—	—	(*)	—
Post-employment benefits	2,599	(*)	624	190	(*)	46
Other temporary differences	19,248	(*)	4,619	7,659	(*)	1,838

Total for IRES purposes	154,451		37,069	129,649		31,115

Difference between book value and tax value of intangible assets	132,936	(*)	5,184	121,924	(*)	4,755
Difference between book value and tax value of investment property and investments in property, plant and equipment	66	(*)	3	66	(*)	3

Total for IRAP purposes	133,002		5,187	121,990		4,758
(*) It should be noted that, with reference to income taxes, each Group company applied the tax rate applicable in the country of residence. As for IRAP, each Group company applied the tax rate in force, taking into account the distribution of the tax base by region.

17. OTHER NON-CURRENT ASSETS

The balance of “Other non-current assets”, amounting to € 168 thousand, shows an increase of € 12

thousand, due to the effect of the deposits paid on new lease agreements, net of those reimbursed.


Other non-current assets	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Guarantee deposits	168	129
Others	—	27

Total other non-current assets	168	156

18. TAX RECEIVABLES AND PAYABLES


Tax receivables	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Receivables from the tax authorities for IRAP	1,087	383
Receivables from the tax authorities for IRES	220	—
Receivables from Fininvest for IRES	1,379	1,570
Receivables from the tax authorities for IVA	5,338	5,565
Receivables from the tax authorities for direct tax to recover and advances on disputes	1,025	1,315

Total tax assets	9,049	8,833

262

2022 ANNUAL FINANCIAL REPORT

The value of "Tax Receivables", as at 31 December 2022, amounted to € 9,049 thousand, an increase of €

216 thousand, compared to the previous year, due to the remaining higher IRAP advances paid during the

year, net of the accrued tax.

The advances turned out to be higher than the tax burden for the year due to the reduction in the

economic results of some companies.

Receivables from Fininvest S.p.A., amounting to € 1,379 thousand, are represented by withholding

taxes paid by companies that are part of the tax consolidation.

“Receivables from the tax authorities for direct tax to recover and advances on disputes”, amounting

to € 1,025 thousand, includes mainly:

•receivables recognised as a result of the deductibility of IRAP from the IRES taxable base for € 784

thousand;

•receivables from companies acquired in 2022, not yet included in the scope of the tax consolidation

prepared by Fininvest S.p.A.;

•receivables for tax disputes for a total of € 8,903 thousand, fully written down.


Income tax payables	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Payables to the tax authorities for IRAP	521	451
Payables to the tax authorities for IRES	751	5,081
Payables to Fininvest for IRES	9,400	11,898

Total income tax payables	10,671	17,431

"Income tax payables", amounting to € 10,671 thousand, recorded a decrease of € 6,760 thousand,

mainly due to the debt accumulated by D Scuola S.p.A. at the end of the previous year, during which

the company had not paid IRES tax advances, because it still belonged to the De Agostini Group's tax

consolidation area.

19. OTHER CURRENT ASSETS

"Other current assets", which amounted to € 72,213 thousand, increased by € 1,744 thousand, mainly

due to the effect of the increase in prepaid expenses on cloud service fees and advances paid by

Edizioni Star Comics S.r.l. to the companies licensing the rights to exploit the comics upon signing the

contract.

The value of "Other Receivables", amounting to € 1,985 thousand decreased due to the collection of

the receivable from La Verità S.r.l., relating to the sale of Stile Italia Edizioni S.r.l., amounting to € 1,129

thousand; the balance includes receivables from INPS related to training courses financed by the

public fund on new skills.

263

Mondadori Group Consolidated Financial Statements at 31 December 2022


Other current assets	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Receivables due from agents	174	261
Receivables from authors	123,697	121,470
Provision for advances to authors	(67,144)	(64,866)
Receivables from suppliers and associates	6,274	6,358
Accrued income and deferred expenses	7,225	4,469
Other receivables from associates	2	70
Other receivables	1,985	2,707

Total other current assets	72,213	70,469

20. INVENTORY

The value of "Inventory", equal to € 151,353 thousand, increased compared to the previous year by €

30,718 thousand, due to the contribution of the companies acquired in 2022, amounting to € 12,308

thousand, and for the reasons reported below, with comments on the various components.


Inventory	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Raw and ancillary materials and consumables	14,716	9,155
Write-down of raw and ancillary materials and consumables	(926)	(760)

Total raw and ancillary materials and consumables	13,789	8,395

Work in progress and semi-finished goods	12,298	12,260
Write-down of work in progress and semi-finished goods	(1,627)	(1,340)

Total work in progress and semi-finished goods	10,671	10,921

Finished products and goods	200,688	172,887
Write-down of finished products and goods	(73,796)	(71,569)

Total finished products and goods	126,893	101,318

Total inventory	151,353	120,634

The value of "Raw and ancillary materials and consumables", amounting to € 13,789 thousand,

increased by € 5,394 thousand, due to increases in volumes purchased, to meet the increased

production related to the enlarged scope of consolidation, and to the cost of raw materials.

The value of "Work in progress and semi-finished goods", amounting to € 10,671 thousand, is

substantially in line with that of 2021.

"Finished products and goods" includes books produced by the Group, third-party publishers’ books

purchased for re-sale in the Retail segment and merchandising, paper processing and gifts.

The amount of € 126,893 thousand increased by € 25,575 thousand, compared to 31 December 2021,

mainly due to:

•the contribution of the new companies acquired during the year (€ 12,067 thousand);

•growth in the costs of raw materials and printing and packaging services;

264

2022 ANNUAL FINANCIAL REPORT

•the anticipated production of some titles by Rizzoli International Publications Inc.;

•the change in the euro/dollar exchange rate, which led to an increase in the value of inventories of

about € 1 million.

Inventory write-down was calculated separately and analytically for each Group company, in

consideration of the saleability of finished products and the relative rotation indexes, the possible

unproductiveness of work-in-progress or semi-finished products, and the deterioration of raw

materials.


Inventory - Write-down	Raw material	Work in progress and semi-finished goods	Finished products and goods
(Euro/thousands)	Raw material	Work in progress and semi-finished goods	Finished products and goods

Total at 31/12/2020	698	1,101	73,931
Changes in the year:
- allocation	89	297	1,788
- utilisations	(76)	(91)	(10,316)
- other changes	49	33	6,166

Total at 31/12/2021	760	1,340	71,569

Changes in the year:
- allocation	215	251	4,311
- utilisations	(48)	(7)	(5,870)
- other changes	(1)	43	3,786

Total at 31/12/2022	926	1,627	73,796

None of the inventory recorded in the financial statements are pledged as guarantees for liabilities..

Decrease (increase) in inventory

The income statement effects resulting from the changes in inventory and the provisions for value

adjustments are detailed below..

265

Mondadori Group Consolidated Financial Statements at 31 December 2022


Decrease (increase) in inventory	Year	Year
(Euro/thousands)	2022	2021

Changes in finished products and goods	(12,304)	8,046
Allocation to the provision for write-downs of finished products and goods	4,311	1,788
Utilisation of the provision for write-downs of finished products and goods	(5,870)	(10,316)

Total changes in finished products and goods	(13,863)	(482)

Changes in work in progress and semi-finished goods	350	(220)
Allocation to the provision for write-downs of work in progress and semi- finished goods	251	297
Utilisation of the provision for work in progress and semi-finished goods	(7)	(91)

Total changes in work in progress and semi-finished goods	594	(15)

Changes in raw and ancillary materials and consumables	(5,560)	(1,836)
Allocation to the provision for write-downs of raw and ancillary materials and consumables	215	89
Utilisation of the provision for write-downs of raw and ancillary materials and consumables	(48)	(76)

Total changes in raw and ancillary materials and consumables	(5,394)	(1,823)

Total decrease (increase) in inventory	(18,663)	(2,320)

21. TRADE RECEIVABLES

"Trade receivables", amounting to € 161,230 thousand, decreased versus € 164,971 thousand at 31

December 2021, despite the change in the scope of consolidation, which contributed a net trade

receivables value of € 9,242 thousand.


Trade receivables	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Receivables from customers	134,694	135,752
Receivables from associates	25,798	28,585
Receivables from parent companies	—	22
Receivables from affiliates	739	612

Total trade receivables	161,230	164,971

In particular, "Receivables from customers", which amounted to € 134,694 thousand, decreased by € 1,058

thousand, attributable to the Education Books Area, as a result of lower revenues.

266

2022 ANNUAL FINANCIAL REPORT


Trade receivables - Receivables from customers	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Receivables from customers	210,835	212,406
Customers – returns to receive	(62,081)	(63,022)
Provision for bad debts	(14,060)	(13,632)

Total trade receivables	134,694	135,752

The provision for bad debts, amounting to € 14,060 thousand, does not differ greatly from the amount at 31

December 2021; the amount of the provision was determined following a thorough analysis completed on

customer creditworthiness and credit positions at risk of collection.


Trade receivables - Receivables from customers - Write-down	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Balance at beginning of year	13,632	13,598
Changes in the year:
- allocation	3,694	5,113
- utilisations	(3,728)	(6,064)
- changes in consolidation scope and other changes	462	985

Total provision for bad debts	14,060	13,632

“Payables to associates", amounting to € 25,798 thousand, referring mainly to transactions carried out

with Mediamond S.p.A., the advertising agency for magazine titles, fell by € 1,380 thousand.

There were no trade receivables due over five years.

22. EQUITY

Shareholders' equity as at 31 December 2022 was € 260,826 thousand (€ 219,581 thousand as at 31

December 2021), the movements in which are detailed in the statement of changes in shareholders'

equity, increased by € 41,245 thousand, mainly due to the net result for the year, positive at € 52,067

thousand, the increase in the cash flow hedge reserve by € 8,250 thousand, as a counterpart to the

appreciation of the interest rate derivative, net of the distribution of dividends of € 22,163 thousand.

Share Capital

Arnoldo Mondadori Editore S.p.A.’s share capital amounts to € 67,979,168.40, divided into no.

261,458,340 ordinary shares with a par value of € 0.26 each.

The legal entity controlling the Mondadori Group is Fininvest S.p.A....

Treasury shares

In 2022, Arnoldo Mondadori Editore S.p.A. purchased no. 410,000 treasury shares on the MTA, equal

to 0.157% of the share capital and assigned no. 311,847 shares to the beneficiaries of the 2019-2021

Performance Share Plan, bringing the total number of treasury shares held to no. 1,147,991, equal to

0.439% of the share capital.

267

Mondadori Group Consolidated Financial Statements at 31 December 2022

The value of treasury shares servicing the incentive plans named "Performance Share Plan

2020-2022", "Performance Share Plan 2021-2023" and "Performance Share Plan 2022-2024", at 31

December 2022, amounted to € 2,024 thousand, up versus € 1,803 thousand at 31 December 2021.

Other reserves and profit/loss carried forward

“Other reserves and profit/(loss) carried forward” at 31 December 2022 amounted to € 141,540

thousand (€ 109,186 thousand at 31 December 2021) and included::

•a legal reserve of € 13,596 thousand;

•a revaluation reserve used over the years for a total of € 16,711 thousand (€ 16,711 thousand at 31

December 2021);

•a cash flow hedge reserve, amounting to € 9,072 thousand (€ 822 thousand at 31 December 2021),

net of the relevant tax impact, for the valuation of hedge derivatives;

•a reserve that covers the incentive plans in accordance with IFRS 2, amounting to € 1,731 thousand

(€ 1,277 thousand at 31 December 2021);

•a reserve for post-employment discounting, net of the relevant tax impact of € 699 thousand (€ 317

thousand at 31 December 2021);

•the translation reserve, amounting to € 1,739 thousand (€ 365 thousand at 31 December 2021),

resulting from the translation of the financial statements of the companies belonging to the Attica

Group, with offices in Eastern European countries, and of the Chinese joint-venture Mondadori Seec

Advertising Co. Ltd and Rizzoli International Publications Inc..

The exchange rates used for the translation of financial statements denominated in foreign currencies

are summarized in the table below:


Currency	Actual	Actual	Average	Average
Currency	31/12/2022	31/12/2021	2022	2021

U.S. dollar	1,07	1,18	1,05	1,13
Chinese yuan	7,36	8,02	7,08	7,19
New Romanian Leu	4,95	4,95	4,93	4,92
Bulgarian leva	1,96	1,96	1,96	1,96
Serbian dinars	117,33	116,97	117,47	117,58

•the residual balance represents reserves for retained earnings from past years..

Capital Management

The Mondadori Group capital is managed in relation mainly to the Group overall financial structure,

taking into account a correct balance between net debt and capital.

The main index used by the Group for measuring capital adequacy compares net debt with capital to

net debt. Net debt includes all liabilities (payables to banks) net of cash and cash equivalents.

268

2022 ANNUAL FINANCIAL REPORT


Capital management	31/12/2022	31/12/2021
(Euro/millions)	31/12/2022	31/12/2021

Net debt	177.4	179.1
Capital (equity)	260.8	219.6

Total capital and net debt	438.2	398.7

Ratio of net debt/capital to net debt	40.5%	44.9%
Treasury shares	2.0	1.8

23. CAPITAL, RESERVES AND RESULTS ATTRIBUTABLE TO MINORITIES

Below is a breakdown of non-controlling interests’ equity:


Capital, reserves and results attributable to minorities	Edizioni Star Comics	Zenzero	De Agostini Libri	Rizzoli Education
(Euro/thousands)	Edizioni Star Comics	Zenzero	De Agostini Libri	Rizzoli Education

Shareholders’ equity as at 31 December 2021	—	—	—	7
Result for 2021	—	—	—	6

Shareholders’ equity as at 31 December 2022	—	(23)	1,265	21
Result for 2022	348	(30)	(848)	6

Minority interests are accounted for taking into account put and call agreements with minority

shareholders.

24. PROVISIONS

The value of "Provisions", amounting to € 41,922 thousand, recorded a decrease of € 5,157 thousand,

despite the contribution of the companies acquired during the year, amounting to € 424 thousand,

mainly due to the utilisation of the provision for restructuring charges and the provision for contractual

commitments, related to commitments undertaken, especially in the museum business, with contracts

that have been entered into.

Provisions mainly refer to staff restructuring charges, contractual commitments and legal risks; the

column "Other changes" mainly shows values related to changes within the scope of consolidation.

269

Mondadori Group Consolidated Financial Statements at 31 December 2022


Provisions	31/12/2021	Alloc.	Uses	Other changes	31/12/2022
(Euro/thousands)	31/12/2021	Alloc.	Uses	Other changes	31/12/2022

Provision for agents' contractual risks	2,403	91	(186)	112	2,420
Provision for personnel downsising risks	9,376	1,007	(4,929)	(200)	5,254
Provision for legal risks	11,556	1,073	(708)	260	12,182
Provision for investment risks	—	—	—	—	—
Provision for tax disputes	600	—	(850)	250	—
Provision for contractual commitments	7,628	772	(1,261)	—	7,140
Provision for contractual commitments ad agency	2,182	30	(683)	—	1,529
Other provisions for risks	13,334	1,954	(1,884)	(7)	13,397

Total provisions	47,079	4,928	(10,501)	415	41,922

25. POST-EMPLOYMENT BENEFITS

“Post-employment benefits” amounted to € 28,350 thousand, an overall decrease of € 4,452

thousand.

In particular, the indemnities to be paid to employees decreased from € 15,831 thousand to € 13,795

thousand, while the indemnities to be paid to the sales network decreased from € 16,950 thousand to

€ 14,533 thousand, due to the reduction in staff and the turnover of agents, but also due to the

increase in the discount rates, from 0.98% to 3.77%, used for actuarial valuations.


Post-employment benefits	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Provision for post-employment benefits (TFR)	13,795	15,831
Provision for supplementary agents’ indemnity (FISC)	14,533	16,950
Provision for pensions and similar obligations	22	22

Totale indennità di fine rapporto	28,350	32,802

Post-employment benefits and the supplementary agents’ indemnity were determined by applying an

actuarial method in compliance with IAS 19 and IAS 37.

It should be noted that for both calculations, a discounting rate based on the iBoxx benchmark, Euro

area, rating AA and with a 10+ duration, was used consistently with past valuations.

270

2022 ANNUAL FINANCIAL REPORT


Actuarial assumptions to measure TFR	31/12/2022	31/12/2021

Economic assumptions:
- increase in cost of living	3,00%	1,00%
- discounting rate	3,77%	0,98%

Demographic assumptions:
- probability of death	IPS55 tables	IPS55 tables
- probability of disability	INPS-2000 tables	INPS-2000 tables
- probability of leaving for other reasons	From 2.50% to 15.93%	From 4.00% to 15.69%
- retirement age	Regulations in force	Regulations in force


Actuarial assumptions to measure FISC	31/12/2022	31/12/2021

Economic assumptions:
- discounting rate	3,77%	0,98%

Demographic assumptions:
- probability of death/disability	1,0%	1,0%
- probability of leaving service	5,0%	5,0%
- probability of voluntary resignation	1,5%	1,5%
- average age of agency contract termination	Regulations in force	Regulations in force

The change in the discount rate, from 0.98% to 3.77%, led to a reduction in the provision for post-

employment benefits of € 1,777 thousand.

Post-employment benefits cost items, booked under income statement, include the service cost of

companies with less than 50 employees for € 182 thousand, financial costs of € 159 thousand, and the

portion paid into the supplementary pension scheme for € 6,504 thousand.

The changes in the "Provision for supplementary agents' indemnity" reflect the turnover occurring in

the Group's sales force during the financial year 2022; the item "Provisions" includes the effect of

discounting.

"Provision for retirement" was not subject to discounting as the effects are irrelevant.


Post-employment benefits - Details	Employee Severance Fund (TFR)	FISC	Provision for retirement
(Euro/thousands)	Employee Severance Fund (TFR)	FISC	Provision for retirement

Total at 31/12/2021	15,831	16,950	22

Changes in 2021:
- allocations	573	(1,123)	—
- utilisations	(2,230)	(1,857)	—
- reversals		—	—
- interest costs	159	—	—
- changes in consolidation scope and other changes	(537)	563	—

Total at 31/12/2022	13,795	14,533	22

271

Mondadori Group Consolidated Financial Statements at 31 December 2022

26. OTHER CURRENT LIABILITIES

The value of "Other current liabilities", which amounted to € 142,049 thousand, increased compared to

31 December 2021, despite the different scope of consolidation, which, in 2022, included the

contributions of € 3,396 thousand from De Agostini Libri S.r.l. and Edizioni Star Comics S.r.l.

The main changes are attributable to:

•a reduction in "Taxes payables", from € 10,275 thousand to € 8,737 thousand, due to the payment of

the second instalment payable on the transactions, concluded in 2021, for the realignment of the tax

values of certain trademarks and goodwill to their respective book values, and due to lower

payables to the Tax Authorities for withholding taxes made in 2021, as withholding agent, on higher

salaries because they included a one-off payment;

•a decrease in "Other payables, accrued liabilities and deferred income", from € 12,873 thousand to €

10,839 thousand, due to lower revenues accruing in the coming financial year related to exhibitions

opening in 2022 and lower accruals on insurance premiums.


Other current liabilities	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Customer advances	2,629	2,556
Tax payables	8,737	10,275
Payables to welfare and social security entities	12,769	13,070
Payables to associates and affiliates	301	333
Other payables	117,612	118,580

Total other current liabilities	142,049	144,813

Details of "Other payables”.


Other current liabilities – Other payables	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Payroll and other payables to personnel	20,271	20,777
Payables to authors and associates	69,015	67,706
Payables to subscription and instalment customers	17,487	17,224
Other payables, accrued liabilities and deferred income	10,839	12,873

Total other payables	117,612	118,580

27. TRADE PAYABLES

The item "Trade payables", amounting to € 252,689 thousand, increased by € 34,894 thousand, as a

result of the acquisitions of De Agostini Libri S.r.l. and Edizioni Star Comics S.r.l., which at the end of

the year accounted for a total of € 8,729 thousand, the increased purchases made by Mondadori

Retail S.p.A, due to the expansion of the network of stores and the greater volume of business

developed, which resulted in higher payables to suppliers of € 12,328 thousand, and the significant

increase in the cost of raw materials and printing and packaging services.

272

2022 ANNUAL FINANCIAL REPORT


Trade payables	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Payables to suppliers	246,455	210,983
Payables to associates	4,871	4,018
Payables due to parent companies	19	18
Payables to affiliates	1,345	2,776

Total trade payables	252,689	217,796

“Payables to associates" refers to the distribution of the publishing product of Edizioni EL S.r.l. and the

sale of goods in exchange for advertising pages carried out with Mediamond S.p.A..

Payables to associates, parent companies and affiliates are detailed in Annex "Transactions with

related parties"; transactions with related parties are carried out under normal market conditions.

There were no trade payables due over five years.

28. NET FINANCIAL POSITION

The following table shows the composition of the net financial position.


Net financial position	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Non-current financial assets	13,410	553
Current financial assets	614	181
Cash and cash equivalents	34,941	90,714
Non-current financial liabilities	(119,250)	(122,953)
Current financial liabilities	(36,717)	(69,507)
Financial assets (liabilities) from discontinued operations	857	6,263

Net financial position before IFRS 16	(106,145)	(94,750)

Financial liabilities IFRS 16	(71,262)	(84,284)
Financial liabilities IFRS 16 discontinued operations	—	(44)

Net financial position including IFRS 16 effect	(177,406)	(179,078)

The net financial position, according to the format recommended by CONSOB shown below, which

does not include "Non-current financial assets" amounting to € 13,410 thousand, stood at € -190,816

thousand.

273

Mondadori Group Consolidated Financial Statements at 31 December 2022


Net financial position	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

- Cash	1,867	1,612
- Bank deposits	32,297	93,987
- Postal deposits	776	528
A Cashfunds	34,941	96,127
B Cash equivalents	—	—
C Other current financial assets	614	181

D Liquidity (A+B+C)	35,555	96,308

- Current bank payables	(169)	(200)
- Other current financial payables	(9,857)	(35,601)
E Current financial debt (including debt instruments, excluding current portion of non-current financial debt)	(10,025)	(35,801)
- Loans	(25,833)	(45,833)
F Current portion of non-current financial debt	(25,833)	(45,833)

G Current financial debt (E+F)	(35,859)	(81,634)
H Net current financial debt (G-D)	(304)	14,674

- Loans	(104,608)	(118,553)
- Financial liabilities IFRS 16	(71,262)	(71,353)
- Derivatives and other financial liabilities	(14,642)	(4,400)
I Non-current debt (excluding current portion and debt instruments)	(190,512)	(194,306)
J Debt instruments	—	—
K Trade payables and other non-current payables	—	—

L Non-current financial debt (I+J+K)	(190,512)	(194,306)
M Total financial debt (H+L)	(190,816)	(179,632)

Non-current financial assets

The value of "Non-current financial assets", amounting to € 13,410 thousand, increased by € 12,857

thousand, attributable to:

•€ 2,450 thousand for the loan granted by Mondadori Media to its associate Press-Di Distribuzione e

Multimedia S.r.l.;

•€ 10,407 thousand to the higher fair value of interest rate risk derivatives, related to the increase in

market rates in 2022.

The balance includes the loan to Attica Publications, in the amount of € 500 thousand which was

already in place at the end of the previous year.


Non-current financial assets	31/12/2022	31/12/2021
(Euro/thousands	31/12/2022	31/12/2021

Financial receivables from associates	2,950	500
Financial receivables	—	—
Assets resulting from derivative instruments	10,460	53

Total non-current financial assets	13,410	553

274

2022 ANNUAL FINANCIAL REPORT

The item "Other current financial assets", amounting to € 614 thousand, increased by € 433 thousand.


Other current financial assets	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Financial receivables from customers	—	—
Financial receivables from associates	—	—
Financial receivables from parent companies	—	—
Financial receivables from affiliates	—	—
Financial receivables from others	602	170

Total financial receivables	602	170

Financial assets at fair value with adjustments recognised in the income statement	—	—
Available-for-sale financial assets	12	10
Assets resulting from derivative instruments	—	—

Total other current financial assets	614	181

Cash and cash equivalent

The item amounted to € 34,941 thousand, down by € 55,773 thousand versus 31 December 2021; the

fair value of cash and cash equivalents is equal to their relevant book value at 31 December 2022.


Cash and cash equivalents	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Cash and cash on hand	1,867	(3,773)
Bank deposits	32,297	93,989
Post office accounts	776	497

Total cash and cash equivalents	34,941	90,714

Non-current financial liabilities

“Non-current financial liabilities” includes:

•the amortised costs mainly of the Line A Amortising Term Loan and the use of Line C of the pool

loan, coming to maturity in December 2026, totalling € 104,535 thousand;

•consideration, with deferred payment, related to certain acquisitions concluded in recent years,

amounting to € 14,642 thousand.

275

Mondadori Group Consolidated Financial Statements at 31 December 2022


Non-current financial liabilities	Effective interest rate	Maturity between 1 and 5 years	Maturity over 5 years	31/12/2022	31/12/2021

Loans	0,62%	104,608	—	104,608	118,552
Liabilities from derivatives		—	—	—	124
Other financial payables		7,990	6,652	14,642	4,276

Total non-current financial liabilities		112,598	6,652	119,250	122,953

Payables to banks and other current financial liabilities

“Payables to banks and other current financial liabilities” amounted to € 36,717 thousand and

included:

•the portion of Term Loan A of the pool loan, maturing in December 2023, amounting to € 15,833

thousand; "Hot Money" financing, maturing in January 2023, amounting to € 10,000 thousand;

•other financial payables in the amount of 10,715, mainly for deferred payments related to certain

acquisitions concluded in recent years.


Payables to banks and other current financial liabilities	Effective interest rate	31/12/2022	31/12/2021
(Euro/thousands	Effective interest rate	31/12/2022	31/12/2021

Bank deposits		169	200
Loans	0,22%	25,833	45,833
Financial payables to associates		—	—
Other financial payables		10,715	23,474

Total payables to banks and other current financial liabilities		36,717	69,507

At 31 December 2022, the Leverage Ratio Financial Covenant (debt/EBITDA) resulting from the

consolidated annual report was equal to 0.87, far below the cap of 3.25 under the pool loan

agreement.

The forecasts contained in the medium-term plan show no reasonably foreseeable sign of

overshooting the cap in the future.

Changes in committed credit lines:


(Euro/thousands)	31/12/2021	Uses	Repayments	Other changes	31/12/2022

Pool loan December 2017
Line A maturing in 2026	74,961	—	(15,833)	1,554	60,682
Line C	59,397	—	—	289	59,686

Total	134,358	—	(15,833)	1,843	120,368

Assets and liabilities resulting from derivative instruments

276

2022 ANNUAL FINANCIAL REPORT


Assets and liabilities resulting from derivative instruments - Details	Type of derivative instrument	Fair value at 31/12/2022	Fair value at 31/12/2021
(Euro/thousand)	Type of derivative instrument	Fair value at 31/12/2022	Fair value at 31/12/2021

Non-current financial assets (liabilities)
- Rate derivatives	Cash flow hedge	10,460	53
- Rate derivatives	Cash flow hedge	—	(124)

Current financial assets (liabilities)
- Currency derivatives	Trading	—	—

The Group has adopted a Financial Risk Management policy. The use of derivative instruments is in

line with the guidelines contained in such policy. In order to verify hedging efficiency, the Group

performs a series of prospective tests and, where necessary, retroactive tests on a quarterly basis.

Assets resulting from derivative instruments amounting to € 10,460 thousand, include:

•the fair value relating to the hedging transactions on the existing interest rate risk (carried out with

Banco BPM, BNP Paribas, Intesa Sanpaolo and UniCredit), based on 100% of the Line A Amortising

Term Loan of the pool loan agreement entered into in May 2021, maturing in December 2026 for a

residual notional amount of € 63.3 million and a weighted average rate of -0.086%;

•the fair value related to the interest rate risk hedging transactions in place (carried out with Banco

BPM, BNP Paribas, Intesa Sanpaolo and UniCredit), applying to 100% of the use of Line C Acquisition

Line of the pool loan agreement concluded in May 2021, coming to maturity in December 2026 for a

notional value of € 60 million and a weighted average rate of -0.098%.

The table below shows the hedge impact on income statement and equity:


Cash flow hedge reserve	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Initial balance gross of the tax impact	(1,081)	(819)
Amount recognised in the period	(11,006)	189
Amount endorsed from reserve and recognised in the income statement:
- adjustments to expense	123	7
- adjustments to income	26	(458)
Final balance gross of the tax impact	(11,938)	(1,081)
Inefficient part of hedge	—	—

Financial liabilities IFRS 16

"Financial liabilities IFRS 16", amounting to € 71,262 thousand, decreased by € 13,022 thousand

compared to 31 December 2021.

The amount was determined by classifying the rights of use in clusters, based on the contractual

maturity, and applying a different discount rate to each of them: for Italian companies equal to the

three-month Euribor (zero floor) plus a spread, and for US companies equal to the three-month

treasury rate plus a spread.

277

Mondadori Group Consolidated Financial Statements at 31 December 2022


Financial liabilities IFRS 16 (Euro/thousand)	Maturity between 1 and 5 years	Maturity over 5 years	31/12/2022	31/12/2021

Non-current financial liabilities IFRS 16	37,879	20,217	58,096	71,340
Current financial liabilities IFRS 16			13,166	12,944

Total financial liabilities IFRS 16	37,879	20,217	71,262	84,284

29. REVENUES FROM SALES AND SERVICES

Consolidated revenues in 2022 recorded an increase in all of the sectors in which the Mondadori

Group operates, with the exception of the Media Area, which was affected by the sale of Donna

Moderna and CasaFacile publications, going from € 807,345 thousand in the previous year to €

903,003 thousand; part of the increase can be attributed to the circumstances in 2021, which was

characterised in the first months of the year by restrictions on the opening of stores at shopping

centres, some museum venues and temporary exhibitions, to counter the spread of COVID-19.


Revenues from sales and services	2022	2021	% Difference
(Euro/thousands)	2022	2021	% Difference

Books	576,229	464,968	23.9%
Retail	189,191	173,912	8.8%
Media	177,797	206,603	(13.9%)
Other business and corporate	41,525	40,896	1.5%

Aggregate revenue	984,742	886,379	11.1%
Intercompany revenue	(81,739)	(79,035)	3.4%

Total revenue from sales and services	903,003	807,345	11.8%

Revenues from the Books Area, which amounted to € 576,229 thousand, increased by about 24 %,

due to the performance of the publishing houses in the Trade segment, to which the consolidation of

Edizioni Star Comics S.r.l. from 1 July 2022 also contributed, as well as the resumption of activities

related to the management of museums and cultural heritage and the first-time consolidation of the

economic data of D Scuola S.p.A..

Revenues from the Retail Area, amounting to € 189,191 thousand increased by about 9 %, mainly

attributable to the sales channel of directly operated bookshops.

Media Area revenues, which amounted to € 177,797 thousand decreased by about 14%, due to the

changes in the scope of consolidation that took place. On a like-for-like basis, total Media Area

revenues showed a slight increase of 1.8% compared to the financial year 2021, thanks in particular to

the positive performance of digital advertising sales, up by about 15%, which more than offset the

decrease in circulation revenues of the titles and add-on sales.

Revenue from the Group’s advertising services totalled € 71.3 million and refers mainly to the Group’s

share, as publisher of magazines and websites, of the advertising space sold by the advertising

agency, as well as to revenue from digital marketing activities carried out by AdKaora S.r.l. and Hej!

S.r.l..

The "Report on Operations" provides further details on revenue trends and the Group’s various lines

of business.

278

2022 ANNUAL FINANCIAL REPORT

30. COST OF RAW AND ANCILLARY MATERIALS, CONSUMABLES AND

GOODS

The “Cost of raw and ancillary materials, consumables and goods”, which amounted to € 173,248

thousand, increased by € 31,318 thousand as a result:

•of the change in the scope of consolidation, which includes for the economic data also D Scuola

S.p.A., as well as De Agostini Libri S.r.l. and Edizioni Star Comics S.r.l., entering, and Press-Di

Distribuzione e Multimedia S.r.l., leaving in the second half of the year, for € 3,498 thousand;

•increased purchases of products and goods to be remarketed in Mondadori Retail S.p.A. Stores and

Electa S.p.A. museum bookshops (€ +11,959 thousand); the former increased in number due to new

openings in 2022 and both types returned to growing revenues, after the restrictions experienced in

the period characterised by COVID-19;

•higher costs for raw material consumption, due to increases in production and the cost of paper, as a

result of a number of factors that had already become apparent in the latter part of 2021, such as the

increase in demand from packaging manufacturers, geared towards replacing plastic with paper, and

some tensions with labour unions that affected a major group of northern European paper mills,

slowing down their production, exacerbated by the repercussions triggered from the conflict in

Ukraine.


Cost of raw and ancillary materials, consumables and goods	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Cost of raw materials	55,216	36,812
Goods for re-sale	115,725	103,766
Consumables, maintenance and other materials	2,307	1,352

Total cost of raw and ancillary materials, consumables and goods	173,248	141,930

31. COST OF SERVICES

"Costs of services", which amounted to € 484,601 thousand, increased by € 47,579 thousand;

compared to the previous year, the new additions in the scope of consolidation resulted in an increase

of € 58,140 thousand, mitigated by the deconsolidation of Press-Di Distribuzione e Multimedia S.r.l.,

effective from 1 July 2022, which led to a reduction in costs of services of € 26,257 thousand.

Further increases, attributable to the number of companies belonging to the Mondadori Group in 2021,

concerned:

•"Processing" amounted to € 8,806 thousand and was mainly concentrated in the Books Area due to

higher production volumes and increased costs for printing and packaging services;

•the “Publisher's share” for € 3,500 thousand due to the significant increase in revenues of Adkaora

S.r.l. and Hej! S.r.l.;

•"Telephone and postal charges", for € 2,933 thousand, mainly for the Segrate office and the

Mondadori Retail S.p.A. store network, as a result of the repercussions caused by the conflict

between Russia and Ukraine.

Among the other costs of services items, the difference with respect to 2021, on a like-for-like basis,

was very limited or decreased; in particular, among the most relevant:

279

Mondadori Group Consolidated Financial Statements at 31 December 2022

•"Rights & Royalties" decreased as a result of lower sales in the Education Books Area and lower

charges to the income statement for advances deemed non-recoverable in the Trade Books

segment;

•"Commissions" decreased as a result of the significant increase in the rates used to discount agents'

post-employment benefits;

•the "Logistics" segment increased by € 373 thousand due to higher volumes processed in the Books

segment, partially offset by a decrease in volumes in the Media Area.


Costs for services	2022	2021
(Euro/thousands)	2022	2021

Rights and royalties	99,377	97,053
Commissions and costs for agents	47,951	41,590
Processing	149,365	114,368
Logistics	42,896	50,389
Consultancy services and third-party collaborations	32,086	29,556
Newsstand channel fee and subscription management	17,988	20,477
Purchase of advertising space and promotion expenses	21,061	21,255
Publisher's share	12,849	9,138
Travel, gifts and entertainment expenses	4,231	2,122
Directors’ and statutory auditors’ fees	2,373	3,769
Insurance	2,014	1,929
Telephone and postal expenses	6,176	3,187
Catering, security and cleaning services	3,685	3,386
Maintenance costs	3,142	2,902
Market surveys, news agencies	2,276	2,602
Bank services and commissions	1,664	1,412
IT services and administrative area	14,249	13,088
Rents and service expenses	11,914	9,093
Temporary work fees	4,609	3,869
Other services	4,695	5,835

Total cost of services	484,601	437,022

“Directors’ and statutory auditors’ fees” comprised fees paid to Directors and Statutory Auditors for €

1,780 thousand and € 593 thousand, respectively.

32. COST OF PERSONNEL

Employees, both permanent and fixed-term, employed by Group companies, numbered 1,900,

including the staff of the companies acquired in 2022 and D Scuola S.p.A., which amounted to 170 at

the balance sheet date and an average of 158 during the financial year.

Press-Di Distribuzione e Multimedia S.r.l., deconsolidated as of 1 July 2022, contributes an average of

20 employees to the workforce figures.

On a like-for-like basis, the workforce decreased by about 1%, as a result of continued efforts to

increase the efficiency of individual areas and company departments.

280

2022 ANNUAL FINANCIAL REPORT


Headcount	Actual	Actual	Average	Average
Headcount	31/12/2022	31/12/2021	2022	2021

Executives	99	98	98	98
White collars, middle managers and journalists	1,782	1,705	1,788	1,721
Manual workers	7	7	8	8

Total	1,900	1,810	1,901	1,827

"Cost of personnel" amounted to € 136,963 thousand, recording an increase of 0.60 %, and of about 2

% on a like-for-like basis, despite the aforementioned reduction in staff.

This trend is attributable to the significant but temporary benefits included in the 2021 figures, which

were obtained by resorting to social safety nets and funded training; net of these savings, labour costs

are in line with the previous year.


Cost of personnel	2022	201
(Euro/thousands)	2022	201

Wages and salaries	99,236	92,917
Social security expense	28,025	26,934
Post-employment benefits TFR	573	65
Supplementary pension scheme plans	6,113	6,411
Other costs	3,015	9,813

Total cost of personnel	136,963	136,140

Information on the Performance Share Plan

At 31 December 2022, the Mondadori Group has 3 share-based payment plans in place intended for

managers of Group companies and for members of the Board of Directors of the Parent.

The reasons underlying the adoption of the Plans are:

•to create a stronger link between the creation of medium- and long-term value and the remuneration

of Management;

•to support Mondadori’s growth following the completion of the optimization of its assets, using a

system that reflects the growth in the value of the company;

•to encourage teamwork at management level, supporting the shared objective of value creation.

The Board – or its representative, the CEO – has the power to amend the Performance Targets in

extraordinary and/or unforeseen situations or circumstances that could have a significant impact on

the results of the Group and/or its area of operations. These situations and circumstances could, for

example, include mergers, demergers, acquisitions, disposals or spin-offs.

Shares are allocated to the beneficiaries at the end of the vesting period on the basis of pre-

established performance targets. Specifically, these targets are related to:

•Total Shareholder Return (TSR) vis-à-vis the constituents of the FTSE Italia All Share index, with a

weighting of 25% (20% for the 2022-2024 plan)

281

Mondadori Group Consolidated Financial Statements at 31 December 2022

•Cumulative EBIT for the three-year period (EBITDA for the 2021-2023 and 2022-2024 Plans), with a

weighting of 25% (20% for the 2022-2024 Plan)

•Cumulative Net profit over the three years, with a weighting of 25%

•Cumulative Free Cash Flow for the three-year period (Ordinary Cash Flow for the 2022-2024 Plan),

with a weighting of 25%

•Impact Inclusion Index, for the 2022-2024 Plan, with a weighting of 10%.

For each of the above performance conditions, minimum, target and maximum result levels are set.

When the minimum (90%) is met for EBIT (EBITDA for the 2021-2023 and 2022-2024 plans), Net Profit

and Free Cash Flow (Ordinary Cash Flow for the 2022-2024 plan), the number of shares granted is

equal to 50% of the target number of options assigned. When the target is met, 100% vests, while with

the maximum, the number of shares granted is equal to 120% of the target number of options

assigned.

The Impact Inclusion Index, being the synthesis of three independent and individually measured fields

of action, can have an outcome indicator value ranging from 0% to 120%, with a corresponding

number of options assigned.

The TSR is defined vis-à-vis the constituents of the FTSE Italia All Share index by measuring

performance over the period of the Plan. If the TSR is equal to or greater than the median, the target is

deemed met and a number of shares up to 120% of the options assigned is granted. If the TSR is lower

than the median, no shares are granted.

They are measured considering the five components of the Plan:

•the “market based” component connected to the measurement of the performance of Arnoldo

Mondadori Editore S.p.A. in terms of Total Shareholder Return (TSR);

•the “non-market based” component relating to the achievement of targets on cumulative Net Profit,

cumulative EBIT/EBITDA, cumulative Free/Ordinary Cash Flow and Impact Inclusion Index.

Pursuant to IFRS 2, the financial instruments underlying the Plan were stated at fair value on their

granting.

The fair value measurement, which takes account of the current share price at the granting date,

volatility, the expected flow of dividends, the duration of the Plan and the free-risk rate, was entrusted

to an independent third-party expert and carried out using a Monte Carlo-type simulation model.

The information documents pursuant to Article 114-bis of Legislative Decree 58/98, which present the

characteristics of the above plans, are publicly available in the Governance section of Arnoldo

Mondadori Editore S.p.A.’s website (www.gruppomondadori.it), at the registered office and at Borsa

Italiana S.p.A.. The table below shows for each plan the costs recognised in the income statement and

the assumptions underlying the fair value measurement.

In first half 2022, the Performance Share Plan for the three-year period 2019-2021 came to maturity. A

total of 311,848 shares were assigned, measured at a weighted average price of € 1.7164. The plan

envisaged a total cost of € 426,920 thousand and the related reserves set aside during the three-year

period were reclassified as available.

The plans in place are described below.

282

2022 ANNUAL FINANCIAL REPORT

2022-2024 long-term incentive plan

At 31 December 2022, the cost of the 2022-2024 Performance Share Plan (intended for the Chief

Executive Officer and 13 selected Mondadori managers who have an employment and/or directorship

relationship with the Company or with its Subsidiaries), recognised in the income statement under

Cost of personnel, amounted to € 295,767 thousand.

The total number of shares granted is 538,410.

The fair value of shares was determined based on the following assumptions:


Granting date	1 June 2022

Residual life at granting date (in months)	31
Expected volatility of the share price	33.89%
Risk-free interest rate	1.36%
% on expected dividends	—%
Fair value of share at granting date (Euro)	1,648

2021-2023 long-term incentive plan

At 31 December 2022, the cost of the 2021-2023 Performance Share Plan (intended for the Chief

Executive Officer and 14 selected Mondadori managers who have an employment and/or directorship

relationship with the Company or with its Subsidiaries), recognised in the income statement under

Cost of personnel, amounted to € 389,515 thousand.

The total number of shares granted is 659,449.

The fair value of shares was determined based on the following assumptions:


Granting date	29 July 2021

Residual life at granting date (in months)	29
Expected volatility of the share price	36.69%
Risk-free interest rate	(0.50%)
% on expected dividends	—%
Fair value of share at granting date (Euro)	1.77

2020-2022 long-term incentive plan

At 31 December 2022, the cost of the 2020-2022 Performance Share Plan (reserved for the CFO -

Executive Director and 8 selected Mondadori Managers who have an employment and/or directorship

relationship with the Company or with its Subsidiaries), recognised in the income statement under

Cost of personnel, amounted to € 218,808 thousand.

The total number of shares granted is 512,431.

The fair value of shares was determined based on the following assumptions:

283

Mondadori Group Consolidated Financial Statements at 31 December 2022


Granting date	9 December 2020

Residual life at granting date (in months)	25
Expected volatility of the share price	40.23%
Risk-free interest rate	30.00%
% on expected dividends	—%
Fair value of share at granting date (Euro)	1.28

33. OTHER EXPENSE (INCOME)

In the year in question, net income amounted to € 3,874 thousand compared to net expenses

recognised in 2021 of € 3,432 thousand..

The change mainly concerned the following income.


Other expense (income)	2022	2021
(Euro/thousands)	2022	2021

Other revenues and income	(16,366)	(12,124)
Various operating costs	12,492	15,556

Total other expense (income)	(3,874)	3,432

"Other revenues and income" increased from € 12,124 thousand to € 16,366 thousand compared to

the previous year; the representative elements of the change are:

•capital gains realised from the sale of the business units consisting of the magazines Donna

Moderna and CasaFacile and from the sale of 80% of the share capital of Press-Di Distribuzione e

Multimedia S.r.l., for a total of € 1,980 thousand;

•increased relief received (€ 6,377 thousand compared to € 4,639 thousand in 2021), to compensate

for the lower revenues realised in connection with the management of museum activities, due to the

limitations imposed by the health emergency;

•grants received, to the extent of 10% of the expenses incurred for the purchase of paper used in the

production of magazines in the 2019 and 2020 financial years, based on Article 188 of Decree-Law

No. 34 of 19 May 2020, as amended, amounting to € 1,888 thousand.


Other expense (income) – Other revenue and income	2022	2021
(Euro/thousands)	2022	2021

Capital gains from the disposal of fixed assets and business units	1,980	487
Contingent assets	3,133	5,522
Others	11,253	6,115

Total other revenues and income	16,366	12,124

Details of “Other operating expense”, amounting to € 12,492 thousand, are provided below.

284

2022 ANNUAL FINANCIAL REPORT


Other (income) expense – Other operating expense	2022	2022
(Euro/thousands)	2022	2022

Receivables management	3,668	5,210
Reimbursements and settlements, net of the use of provisions	1,697	270
Contributions and grants	2,238	1,466
Contingent liabilities	1,077	952
Capital loss from the disposal of fixed assets and business units	19	22
Other tax and duties	3,794	3,244
Sundry expenses	—	4,391

Total other operating expense	12,492	15,556

34. FINANCIAL EXPENSE (INCOME)

Net financial expense in 2022 amounted to € 5,635 thousand and increased by € 511 thousand

versus the prior year, due mainly to:

•interest expenses on loans, which amounted to € 1,114 thousand, increased by € 794 thousand,

despite the reduction in the average borrowing rate, due to the increase in the Group's average

bank exposure, resulting from the acquisitions made at the end of 2021 and during 2022;

•the positive impact of derivative transactions, amounting to € 151 thousand, compared to charges of

€ 1,933 thousand recognised in 2021;

•ancillary financing expenses of € 1,843 thousand, an increase of € 449 thousand, related to the

portions of the amortised cost pertaining to the year;

•net IFRS 9 amortised cost adjustment charges of € 324 thousand, an increase of € 2,069 thousand,

of which € 2,041 thousand related to the amortised cost of the Committed Lines, subject to

refinancing in 2021;

•higher costs for the discounting of deferred payments for € 884 thousand;

•other higher expense/lower income of € 571 thousand (including exchange rate differences of € 127

thousand, lower financial income of € 114 thousand, asset/liability discounting charges of € 101

thousand, other interest expenses of € 187 thousand);

•lower expense from the sale of Reworld Media shares in 2021 amounting to € 448 thousand;

•lower expense, amounting to € 1,724 thousand, from the application of IFRS 16.

285

Mondadori Group Consolidated Financial Statements at 31 December 2022


Financial expense (income)	2022	2021
(Euro/thousands)	2022	2021

Interest from banks and post offices	(21)	(14)
Financial income from derivatives	(151)	—
Financial income	(43)	(188)
Other interest	(50)	(26)

Total interest and other financial income	(265)	(228)

Interest to banks	7	11
Interest payable on loans	1,114	320
Financial expense from derivatives	—	1,933
Ancillary expense on loans	1,843	1,394
Commission on loans	577	531
Other impairment charges (income) IFRS 9	324	(1,745)
Financial expense from discounting of deferred payments	884	—
Financial expense from discounting of assets/liabilities	159	58
Other interest	289	102

Total interest and other financial expense	5,197	2,604

Realised positive currency differences	(100)	(42)
Unrealised positive currency differences	(33)	(20)
Realised negative currency differences	319	141
Unrealised negative currency differences	42	22

Total exchange losses (profit)	228	101

Expense (income) from financial assets	—	448
Financial expense IFRS 16	475	2,198

Total financial expense (income)	5,635	5,122

35. EXPENSE (INCOME) FROM INVESTMENTS

The impact on the income statement of the valuation of investments in jointly controlled companies,

associates and companies in which the Group holds a non-controlling interest, showed a significant

improvement compared to 2021, decreasing from a net expense of € 1,510 thousand to € 199

thousand..

In particular, the most significant changes relate to:

•the sale of Monradio S.r.l., effective as of 1 January 2022, which recorded a loss of € 2,005 thousand

in 2021;

•the higher losses incurred by Società Europea di Edizioni S.p.A., which were offset by the less

negative result of Mondadori Seec Advertising Co. Ltd;

•the positive but declining results of Edizioni EL S.r.l. and Mediamond S.p.A.;

•the write-down of Attica Publications S.A., as a result of the impairment test, in the amount of € 1,687

thousand, which penalised the positive result of ordinary operations.

286

2022 ANNUAL FINANCIAL REPORT


Expense (income) from investments	2022	2021
(Euro/thousands)	2022	2021

- Monradio S.r.l.	—	2,005
- Attica Publications Group	918	(899)
- Società Europea di Edizioni S.p.A.	1,849	1,506
- Mach 2 Libri S.p.A. in liquidation	—	(343)
- GD Media Service S.r.l.	(66)	(53)
- Edizioni EL S.r.l.	(1,256)	(1,708)
-Press-Di Distribuzione e Multimedia S.r.l.	(208)	—
- Mediamond S.p.A.	(475)	(875)
- Mondadori Seec Advertising Co. Ltd	1,200	1,784
- DI 2 S.r.l.	(16)	(48)
- Milano Distribuzione Media S.r.l.	—	141
Total expense (income) from investments	199	1,510

36. INCOME TAX

“Income tax” for 2022 show a charge of € 15,313 thousand, which compares with income for 2021 of €

5,646 thousand.

The main changes are represented by the realignment of the tax values of certain trademarks and

goodwill to their respective book values and the amendment to the agreement on the exercise of the

option for the tax consolidation scheme, carried out in 2021; as well as the improved economic

performance achieved in 2022.

The amount for 2022 also included the positive effect, amounting to € 3,698 thousand, related to the

2022 amendment to the agreement on the exercise of the option for the tax consolidation scheme.


Income tax	2022	2021
(Euro/thousands)	2022	2021

IRES on income for the year	16,162	12,973
IRAP for the year	4,329	3,694

Total current taxes	20,491	16,666

Deferred/pre-paid taxes for IRES	(81)	(22,444)
Deferred/pre-paid tax for IRAP	(753)	(2,102)

Total deferred/pre-paid tax	(833)	(24,546)

Other tax items	(4,344)	2,234

Total income tax expense for the year	15,313	(5,646)

287

Mondadori Group Consolidated Financial Statements at 31 December 2022

Reconciliation between the theoretical tax charge and the current tax charge


(Euro/thousands)	2022			2021
(Euro/thousands)	Net income (loss) before tax	Tax	Current tax rate	Net income (loss) before tax	Tax	Current tax rate

Theoretical IRES tax amount	66,856	16,046	24,00%	38,566	9,256	24,00%
Theoretical IRAP tax amount	66,856	2,607	3,90%	38,566	1,504	3,90%

Total theoretical tax amount/ rate		18,653	27,90%		10,760	27,90%

Actual IRES tax amount		11,704	17,51%		(7,232)	(18,75%)
Actual IRAP tax amount		3,609	5,40%		1,586	4,11%

Total actual tax amount/rate		15,313	22,91%		(5,646)	14,64%

Theoretical tax amount/rate		18,653	27,90%		10,760	27,90%
Effect relating to the recognition of prior years' tax		(5,555)	(8.31%)		(681)	(1.77%)
Effects on companies booked at equity		(355)	(0.53%)		362	(0.94%)
Effect of differences in tax rates on taxable income of foreign subsidiaries		26	0.04%		41	0,11%
Effect of tax realignment and rights from amendment to existing tax consolidation		—	—%		(17,272)	(44.78%)
Net effect of other permanent differences		1,568	2.35%		1,062	2,75%
Effect of different IRAP tax base		976	1.46%		82	0,21%

Current tax amount/rate		15,313	22,91%		(5,646)	(14.64%)

37. EARNING PER SHARE

Basic earnings per share are calculated by dividing net profit for the period attributable to the Group

by the weighted average number of outstanding ordinary shares in the reporting period.


	2022	2021

Net result for the period (Euro/000)	51,543	44,212
Weighted average number of outstanding ordinary shares (no./000)	260,355	260,317
Basic earnings per share from continuing operations (Euro)	0.20	0.17


	2022	2021

Net result for the period (Euro/000)	52,067	44,206
Weighted average number of outstanding ordinary shares (no./000)	260,355	260,317
Basic earnings per share (Euro)	0.20	0.17

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2022 ANNUAL FINANCIAL REPORT

For the purpose of calculating diluted earnings per share, the weighted average number of

outstanding shares is adjusted on the assumption of converting shares with a dilution effect.


	2022	2021

Net result for the period (Euro/000)	51,543	44,212
Weighted average number of outstanding ordinary shares (no./000)	260,355	260,317
Number of options with diluted effect (no./000)	855	1,613
Diluted earnings per share from continuing operations (Euro)	0.20	0.170


	2022	2021

Net result for the period (Euro/000)	52,067	44,206
Weighted average number of outstanding ordinary shares (no./000)	260,355	260,317
Number of options with diluted effect (no./000)	855	1,613
Diluted earnings per share (Euro)	0.20	0.170

38. COMMITMENTS AND CONTINGENT LIABILITIES

Commitments

At 31 December 2022, the Mondadori Group had commitments underwritten for a total of € 54,172

thousand (€ 43,095 thousand at 31 December 2021), consisting of guarantees issued on VAT

receivables subject to reimbursement and prize contest transactions, of leases contracts and letters of

patronage.

Contingent liabilities

Following tax audits by the Revenue Commissioners, a few points were raised on a number of

companies.

In particular:

•as for Arnoldo Mondadori Editore S.p.A., for the years 2004-2005, the Central Division of the

Lombardy Region, through tax assessments, submitted findings relating to IRAP (2004) and to the

application of a 12.50% withholding tax on the interest paid on a loan stock in favour of a subsidiary

for a total of € 4 million, plus applicable ancillary expense (2005). In the matter of IRAP 2004, the

Court of Cassation, by order of 3 February 2022, referred the dispute back to the Court of Justice of

the second instance, which rules over matters concerning tax, deemed there to be a failure to state

reasons in the previous judgement. By appeal filed on 28 September 2022, the Company resumed

the case before the aforementioned Court. The date of the hearing is scheduled for 12 May 2023.

With regard to the finding concerning the withholding tax on interest, the Company appealed to the

Court of Cassation, after the Regional Tax Commission of Milan rejected the appeal. By judgement

filed on 8 March 2023, the Court of Cassation declared that the matter in issue, relating to the

penalty notice, had ceased to exist and referred the dispute to the second instance Court of Justice

on matters of taxation. In particular, the Supreme Court of Cassation, upholding the Company's

arguments, followed the interpretative position expressed on the subject of the "beneficial owner" by

the Court of Justice in its most recent rulings, which were also implemented in the national context,

and, to that effect, the court quashed the contested decision, referring the case back to the second

instance Court of Justice, in a different composition, for the assessment of the factual elements of

the case.

289

Mondadori Group Consolidated Financial Statements at 31 December 2022

For the above indicated potential liabilities, while taking account of the substantial grounds of defense,

the risk of a negative outcome is considered likely, covered by a specific provision for write-downs.

•as for Mondadori Retail S.p.A., it received tax assessments for IRES, IRAP and VAT relating to the

2003-2006 tax years. All these tax assessments were challenged before the Provincial Tax

Commission of Milan, which upheld the appeals. The Office filed an appeal before the Regional Tax

Commission, which confirmed the first instance ruling, annulling the contested acts.

The Office filed an appeal before the Court of Cassation after receiving cancellation of all assessment

notices from the Regional Tax Commission.

Supreme Court hearings were held on 10 June 2021, and:

•as for the ruling regarding IRAP for 2004, a separate appeal of which was pending, it referred the

matter back to the Regional Tax Commission of Milan to review the merits of the appeal. The hearing

before the second instance Court of Justice was held on 27 January 2023, during which the case

was extinguished due to the fact that the dispute had ceased to exist;

•with regard to VAT, IRAP and IRPEG/IRES for 2003, 2004, 2005 and 2006, the Court finally rejected

the appeal filed by the Revenue Agency, thereby confirming the full cancellation of the tax claim.

39. NON-RECURRING EXPENSE (INCOME)

Pursuant to Consob Resolution No. 15519 of 27 July 2006, it should be noted that the Mondadori

Group did not recognise any non-recurring expense (income) in 2022.

40. RELATED PARTIES

Transactions carried out with related parties, including intercompany transactions, do not qualify as

either atypical or unusual, since they refer to standard business activities performed by Group

companies.

When performed out of the scope of standard conditions or when they are imposed by specific

regulatory conditions, transactions with related parties are in any case carried out under market

conditions.

Benefits to key management personnel

At 31 December 2022, the executives holding responsibilities for Mondadori Group planning, direction

and control activities are listed below:

290

2022 ANNUAL FINANCIAL REPORT


Directors
Antonio Porro	CEO
Alessandro Franzosi	Head of Finance and Control

Executives
Enrico Selva	General Manager Trade Books Business Unit
Carmine Perna	General Manager, Retail Business Unit
Carlo Luigi Mandelli	General Manager Media Business Unit
Gian Luca Pulvirenti	General Manager Educational Books Business Unit
Daniele Sacco	Head of Human Resources, Organization and Legal Affairs
Andrea Santagata	Chief Technology and Innovation Officer

As indicated in the 2021 Remuneration Report, the number of Executives with Strategic

Responsibilities was enlarged from five to six, following the entry of Andrea Santagata, Chief

Technology and Innovation Officer, among them.

The total remuneration paid to Executives with Strategic Responsibilities in 2022 amounted to € 5.3

million, with an increase of 16%, mainly due to the presence of two new Executives: the

aforementioned Chief Technology and Innovation Officer and the General Manager of the Education

Books Business Unit, Gianluca Pulvirenti, who joined the Group in December 2021 and was therefore

only present for one month among the previous year's remuneration.

It should also be noted that, with the approval of the 2022 financial statements, the 2020-2022

Performance Share Plan comes to a conclusion, with an overall 27% lower allocation of shares than

that approved by the shareholders' meeting due. This was due, in part, to the dynamics of turnover

among beneficiaries and also, in part, to the actual result equal to 90% of the target, which, despite the

Group's good economic and financial performance, was affected in the TSR by the external effect of

the performance of the FTSE MIB All Share, dragged down by the prices of companies in the Banking

and Oil&Gas sectors.

Transactions with parent companies, affiliates and associates

Transactions with related parties, including intercompany transactions, do not qualify as atypical or

unusual transactions, and were concluded at market conditions.

291

Mondadori Group Consolidated Financial Statements at 31 December 2022

RAPPORTI CON PARTI CORRELATE:

DATI AL 31 DICEMBRE 2022


(Euro/thousands)	Trade receivables	Financial receivables	Tax receivables	Other business	Trade payables	Financial payables	Income tax payables	Other liabilities	Revenues (*)	Purchase of raw materials	Purchase of services	Cost of personnel	Other expense (income)	Financial expense (income)

Parent companies:
- Fininvest S.p.A.	—	—	159	11,018	19	—	10,061	—	—	—	66	—	—	—

Associates
- Attica Publications Group	6	500	—	—	—	—	—	—	12	—	—	—	—	(25)
- Edizioni EL S.r.l.	1,081	—	—	22	2,720	—	—	—	(7,118)	26	(33)	—	—	—
- Mediamond S.p.A.	17,948	—	—	(11)	1,033	—	—	156	37,793	645	(1,010)	—	269	—
- Mondadori Seec Advertising Co. Ltd	904	—	—	—	94	—	—	—	2,160	—	—	—	95	—
- GD Media Service S.r.l.	—	—	—	—	—	—	—	—	37	232	324	—	—	—
- Press-di Distribuzione Stampa e Multimedia S.r.l.	1,904	2,450	—	—	758	—	—	—	35,957	—	10,889	(114)	109	(25)
- Digital Advertising & Engagement S.L.	6	—	—	—	195	—	—	—	21	—	501	—	—	—
- A.L.I. Agenzia Libraria International S.r.l.	3,948	—	—	—	70	—	—	—	3,410	—	73	—	—	—
- DI2 S.r.l.	—	—	—	—	—	—	—	—	—	—	3,190	—	—	—

Total associates	25,798	2,950	—	11	4,871	—	—	156	72,272	903	13,935	(114)	473	(50)

292

2022 ANNUAL FINANCIAL REPORT

RAPPORTI CON PARTI CORRELATE:

DATI AL 31 DICEMBRE 2022


(Euro/thousands)	Trade receivables	Financial receivables	Tax receivables	Other business	Trade payables	Financial payables	Income tax payables	Other liabilities	Revenues (*)	Purchase of raw materials	Purchase of services	Cost of personnel	Other expense (income)	Financial expense (income)

Affiliates:
- RTI - Reti Televisive Italiane S.p.A.	675	—	—	129	60	—	—	2	(1,504)	—	38	—	—	—
- Publitalia ’80 S.p.A.	—	—	—	—	1,225	—	—	—	60	136	1,961	—	—	—
- Banca Mediolanum S.p.A.	—	—	—	—	—	—	—	11	—	—	—	—	—	—
- TaoDue S.r.l.	—	—	—	—	—	—	—	—	—	—	—	—	—	—
- Il Teatro Manzoni S.p.A.	—	—	—	—	—	—	—	—	81	—	(4)	—	—	—
- Mediaset S.p.A.	—	—	—	—	—	—	—	—	—	—	—	—	—	—
- Fininvest Real Estate&Services S.pA.	—	—	—	—	—	—	—	—	—	—	7	—	—	—
- Digitalia'08 S.r.l.	—	—	—	—	—	—	—	—	—	—	(1)	—	—	—
- Radio Mediaset S.p.A.	64	—	—	133	59	—	—	133	433	—	428	—	—	—
- Radio Subasio S.r.l.	—	—	—	—	—	—	—	—	17	—	17	—	—	—

Total affiliates	739	—	—	263	1,345	—	—	146	(912)	136	2,446	—	—	—

Other companies:
- Società Europea di Edizioni S.p.A.	19	—	—	35	132	461	—	52	(4,587)	86	290	—	—	—
Total related parties	26,555	2,950	159	11,326	6,366	461	10,061	354	66,772	1,125	16,737	(114)	473	(50)

related parties from discontinued operations

293

Mondadori Group Consolidated Financial Statements at 31 December 2022

RAPPORTI CON PARTI CORRELATE:

DATI al 31 dicembre 2021


(Euro/thousands)	Trade receivables	Financial receivables	Tax receivables	Other business	Trade payables	Financial payables	Income tax payables	Other liabilities	Revenues (*)	Purchase of raw materials	Purchase of services	Cost of personnel	Other expense (income)	Financial expense (income)

Parent companies:
- Fininvest S.p.A.	22	—	1,570	11,707	18	—	11,898	—	4	—	31	(21)		—

Associates
- Gruppo Attica Publications	29	500	—	—	3	—	—	—	9	—	—	—	1	(22)
- Edizioni EL S.r.l.	1,042	—	—	18	1,592	—	—	(1)	(7,162)	55	38	—	—	—
- Mediamond S.p.A.	27,078	—	—	47	2,277	—	—	220	46,972	1,426	(409)	—	93	—
- Mondadori Seec Advertising Co. Ltd	433	—	—	—	143	—	—	—	1,586	—	1	—	105	—
- GD Media Service S.r.l.	—	—	—		—	—	—	—	31	443	685	—	—	—
- Monradio S.r.l.	3	—	—	—	2	—	—	—	—	—	—	—	1	—
- DI2 S.r.l.	—	—	—	—	—	—	—	—	—	—	6,621	—	—	—
Total associates	28,585	500	—	65	4,017	—	—	219	41,435	1,924	6,936	—	200	(22)

294

2022 ANNUAL FINANCIAL REPORT

RAPPORTI CON PARTI CORRELATE:

DATI al 31 dicembre 2021


(Euro/thousands)	Trade receivables	Financial receivables	Tax receivables	Other business	Trade payables	Financial payables	Income tax payables	Other liabilities	Revenues (*)	Purchase of raw materials	Purchase of services	Cost of personnel	Other expense (income)	Financial expense (income)

Affiliates:
- RTI - Reti Televisive Italiane S.p.A.	582	—	—	84	946	1,200	—	93	(4,348)	(2)	196	—	—	—
- Publitalia ’80 S.p.A.	24	—	—	—	1,825	—	—	—	20	—	2,708	—	—	—
- Banca Mediolanum S.p.A.	—	—	—	—	—	—	—	9	—	—	1	—	—	—
- TaoDue S.r.l.	—	—	—	—	—	—	—	—	36	—	—	—	—	—
- Il Teatro Manzoni S.p.A.	1	—	—	11	—	—	—	11	10	—	9	—	—	—
- Mediaset S.p.A.	—	—	—	—	—	—	—	—	(10)	—	—	—	—	—
- Fininvest Real Estate&Services S.pA.	—	—	—	—	—	—	—	—	—	—	10	—	—	—
- RMC Italia S.p.A											1
- Medusa Film S.p.A.	5	—	—	—	—	—	—	—	4	—	—	—	—	—
- Radio Mediaset S.p.A.	—	—	—	—	5	—	—	—	588	—	597	—	—	—
- Radio Subasio S.r.l.	—	—	—	—	—	—	—	—	9	—	—	—	—	—

Total affiliates	612	—	—	95	2,776	1,200	—	113	(3,691)	(2)	3,522	—	—	—

Other companies:
- Società Europea di Edizioni S.p.A.	404			156	476			52	(11,535)	139	358		—
Total related parties	29,625	500	1,570	12,023	7,287	1,200	11,898	384	26,175	2,061	10,847	(21)	200	(22)

related parties from discontinued operations	2,985			3	1,450
(*) Revenue from distribution services is booked as a fee in compliance with IFRS 15.

295

Mondadori Group Consolidated Financial Statements at 31 December 2022

41. FINANCIAL RISK MANAGEMENT AND OTHER INFORMATION REQUIRED

UNDER IFRS 7

In carrying out its business activities, the Mondadori Group is exposed to various financial risks,

including interest rate risk, exchange rate risk, credit/counterparty risk, issuer risk and liquidity risk.

The Group drafted a “General Policy for Financial Risk Management” aimed at regulating and defining

financial risk management. The Policy also envisaged the establishment of a Risk Committee, whose

task is to define any changes. The Policy was adopted by the Parent Company, Arnoldo Mondadori

Editore S.p.A., and all Group companies.

The Mondadori Group analyses and measures its exposure to financial risks for the purpose of

defining management and hedge strategies. The criteria used by the Group to measure the risks

include the sensitivity analysis of positions subject to risk, involving "mark to market" analysis of

variations and/or future cash flow variations in relation to variations in risk factors.

The overall Policy objective is to minimize financial risks, by using appropriate tools available on the

market. Financial derivative instruments are exclusively used to hedge against financial risks directly

referring to Arnoldo Mondadori Editore S.p.A. or its subsidiaries.

Financial derivative instruments may not be used for speculative purposes.

Specific company functions are responsible for risk management and monitoring and reports are

drafted periodically for each type of risk.

Interest rate risk

Interest rate risk refers to the possibility that losses may be incurred in financial management, in terms

of lower business activity performance or increased liability costs (existing or potential) as a result of

interest rate fluctuations.

Interest rate risk is therefore correlated to interest rate uncertainty. The key objective of interest rate

risk management is to reduce exposure of the Group’s financial margin against market interest rate

fluctuations.

Group exposure to interest rate risk refers mainly to long-term loans, specifically, to the loan granted

by a pool of banks coming to maturity in December 2026, taken out in May 2021.

Interest rate risk hedging is ensured through interest rate swap contracts, converting exposure from

floating to fixed rate.

In particular:

•on the A Term Loan Line, a -0.086% weighted average fixed rate 3-month Euribor, comprising four

interest rate swaps with a notional value of € 63.3 million, coming to maturity in December 2026;

•on Line C, a -0.098% weighted average fixed rate 3-month Euribor, comprising four interest rate

swap forward start 31 January 2022 with a notional value of € 60.0 million, coming to maturity in

December 2026.

The characteristics of the payables are contained in Note 28 "Net financial position".

The following table shows the results of the sensitivity analysis with indication of the relevant impact

on income statement and equity, gross of any tax effects.

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2022 ANNUAL FINANCIAL REPORT


Sensitivity analysis	Underlying	Interest rate increase (decrease)	Income (expense)	Equity increase (decrease)
(Euro/millions)	Underlying	Interest rate increase (decrease)	Income (expense)	Equity increase (decrease)

2022	(8,262)	1%	697	3,881
2021	12,462	1%	1,847	7,070

2022	(8,262)	(1%)	(697)	(2,929)
2021	12,462	(1%)	(473)	(1,479)

While identifying the potential impact correlated to positive and negative interest rate variations,

floating-rate loans were also analysed.

The basic assumptions underlying the sensitivity analysis are:

•an initial parallel shift of the interest curve of + 100/-100 base points;

•all the other risk variables remain constant;

•same analysis performed both on the current year and the prior year.

Currency risk

Currency risk refers to a set of negative effects on the margin or the value of an asset or a liability as a

result of exchange rate fluctuations.

The Mondadori Group is not particularly exposed to exchange rate risks. At 31 December 2022, there

are no exchange derivatives in place.

Liquidity risk

Liquidity risk refers to the possibility that the Group may not be able to meet payment obligations as a

result of its inability to raise new funds (funding liquidity risk), or its inability to sell assets on the market

(asset liquidity risk), thereby being forced to sustain excessively high costs for the purpose of meeting

obligations.

The Group’s exposure to liquidity risk refers mainly to existing loans and borrowings. The Group

currently has a medium/long-term loan (pool loan, taken out in May 2021 and coming to maturity in

2026) in place with banks.

In addition, if deemed necessary, the Group may resort to pre-authorized short-term credit lines.

Details of the characteristics of current and non-current financial liabilities are contained in Note 28

"Net financial position".

At 31 December 2022, liquidity risk was managed by the Mondadori Group through the following

tools:

•bank and post office deposits totalling 34.9 million euro;

•committed credit lines totalling € 418.3 million (€ 295.0 million of which unused) and uncommitted

credit lines of € 212.9 million, unused for € 202.9 million at 31 December 2022.

The table below details Group exposure to liquidity risk and the relevant maturity dates.

297

Mondadori Group Consolidated Financial Statements at 31 December 2022


Liquidity risk	Analysis of maturity dates at 31/12/2022
(Euro/thousands)	< 6 months	6-12 months	1-2 years	2-5 years	5-10 years	> 10 years	Total

Trade payables and other payables	247,936						247,936
Medium/long-term loans	934	187,508	18,457	94,843	—	—	301,742
Other financial:
- committed lines							—
- uncommitted lines	20,883	—					20,883
Other liabilities	83,009						83,009
Payables to associates	4,633						4,633
Total	357,395	187,508	18,457	94,843	—	—	658,203

Derivatives on rate risk	1,729	2,352	3,661	5,633			13,375
Derivatives on currency risk							—

Total exposure	355,666	185,156	14,796	89,210	—	—	644,828


Liquidity risk	Analysis of maturity dates at 31/12/2021
(Euro/thousands)	< 6 months	6-12 months	1-2 years	2-5 years	5-10 years	> 10 years	Total

Trade payables and other payables	213,762						213,762
Medium/long-term loans	522	16,404	186,937	110,061	—	—	313,924
Other financial:
- committed lines							—
- uncommitted lines	53,674						53,674
Other liabilities	83,459						83,459
Payables to associates	4,033						4,033
Total	355,450	16,404	186,937	110,061	—	—	668,852

Derivatives on rate risk	(312)	(270)	(66)	59	—	—	(589)
Derivatives on currency risk							—

Total exposure	355,762	16,674	187,003	110,002	—	—	669,441

Maturity dates were analysed by using undiscounted cash flows and the amounts were accounted for

by taking into account the first date upon which payment becomes due. For this reason, uncommitted

credit lines are shown in the first column.

For the purpose of meeting liquidity requirements, the Group relies on credit lines and liquidity, and

cash flow from operations.

Credit risk

Credit risk refers to the possibility of incurring financial losses as a result of counterparty default in

complying with contractual obligations.

A special type of credit risk is represented by the counterparty/replacement risk in case of derivative

exposure. In this case, the risk is associated with any deferred gains as a result of the possibility that

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2022 ANNUAL FINANCIAL REPORT

the counterparty fails to meet its contractual obligations and thus no positive cash flow is generated in

favour of the Company.

In the case of the Mondadori Group, this potential risk is limited, since the counterparties of derivative

instrument contracts are leading financial institutions with high ratings.

The objective is to limit the risk for losses due to the unreliability of market counterparties or to the

difficulty of converting or replacing existing financial positions. Hence, transactions with non-

authorized counterparties are not allowed.

When approving the Policy, the Board of Directors also approved a list of authorized counterparties for

financial risk hedging. Transactions with such authorized counterparties are constantly monitored and

reports are periodically drafted.

Each individual Group company is responsible for the management of trade receivables in compliance

with the Group financial objectives, business strategies and operating procedures, restricting the sale

of products and services to customers whose credit profile or provision of collateral guarantees does

not conform to the standards set.

The balance relating to trade receivables is monitored throughout the year, to ensure that the amount

of exposure to losses is kept low.

Maximum risk exposure for financial items including derivative instruments: maximum risk exposure is

accounted for before the effects of mitigation deriving from compensation agreements and

guarantees.


Credit risk	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Deposits	33,059	94,486
Financial assets at fair value with adjustments recognised in the income statement	12	10
Receivables and loans:
- trade receivables and other current financial assets	171,200	176,317
- trade receivables and other non-current financial assets	2,497	2,620
Available-for-sale assets	1,298	875
Receivables from hedge derivatives
Guarantees

Total maximum exposure to credit risk	208,066	274,308

The table below shows the Group’s exposure to credit risk by geographical area:


Trade credit risk concentration	Euro/thousands	Euro/thousands	%	%
Trade credit risk concentration	31/12/2022	31/12/2021	31/12/2022	31/12/2021

Italy	155,289	157,557	96.32%	95.51%
Other Countries	5,941	7,414	3.68%	4.49%

Total	161,230	164,971	100.00%	100.00%

Below is a description of the management criteria used for the main business segments:

299

Mondadori Group Consolidated Financial Statements at 31 December 2022

Books

The Group has adopted a specific procedure to assess the risk profile of any new customer. This

procedure comprises the collection of business information to gauge customer reliability before

granting any credit line. Customer reliability is monitored on an ongoing basis.

Media - circulation

The Group’s exposure relates to local distributors represented mainly by small-medium enterprises.

Given the fact that contractual provisions establish the collection of significant advances on supplies,

exposure is represented by the residual amount of sales relating to the month of December.

In order to curb the credit risk, the Group stipulated an insurance policy; given the soundness and

solvency of its counterparties, the Group does not consider credit risk relevant.

Media - advertising

Most of the Group's exposure is with small to medium-sized advertising investors and with media

centres, constantly monitored by Mediamond S.p.A., an equally-held joint-venture with the Mediaset

Group and advertising agency for Mondadori Group titles.

Mediamond S.p.A. controls credit risk with these subjects, for significant investments, through

solvency analysis and the collection of business information before the provision of services.

Each company performs autonomous individual assessments of the most significant positions and

makes the appropriate adjustments, taking account of the estimated recoverable amount, collection

dates, recovery charges and costs and any guarantees issued.

In case of positions not subject to specific losses, the Group companies set up a provision based on

historical data and statistics.

Retail

The Group's exposure is mainly towards franchisees; in order to contain credit risk, Mondadori has

obtained bank and unsecured guarantees from franchisees.

The table below shows the Group’s exposure to credit risk by business area:

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2022 ANNUAL FINANCIAL REPORT


Trade credit risk concentration		Analysis of maturity dates at 31/12/2022
		Net overdraft
	Net to maturity	0-30 days	30-60 days	60-90 days	Over	Provision for bad debts

Books	89,656	1,522	747	297	3,763	7,705
Media	34,103	2,741	355	214	1,897	1,360
Retail	15,219	1,477	299	458	3,958	4,981
Other business	679	168	—	—	—	14

Total	139,657	5,908	1,401	969	9,618	14,060


Trade credit risk concentration		Analysis of maturity dates at 31/12/2021
		Net overdraft
	Net to maturity	0-30 days	30-60 days	60-90 days	Over	Provision for bad debts

Books	83,690	2,231	743	385	6,988	7,675
Media	43,893	1,819	657	427	1,440	1,470
Retail	16,071	1,530	462	423	3,804	4,477
Other business	376	19	—	—	11	11

Total	144,030	5,599	1,862	1,235	12,243	13,633

Other information required under IFRS 7

The table below summarizes financial assets and liabilities classified according to the categories

defined by IFRS 9 and the relevant fair value:

IFRS 7 requires values regarding financial assets and liabilities to be classified based on a scale of

levels reflecting input significance used when calculating fair value.

301

Mondadori Group Consolidated Financial Statements at 31 December 2022


Classification	Book value						Fair value
(Euro/thousands)	Total		of which current		of which non-current		Fair value
(Euro/thousands)	31/12/2022	31/12/2021	31/12/2022	31/12/2021	31/12/2022	31/12/2021	31/12/2022	31/12/2021
Financial assets held to collect, measured at fair value with adjustments recognised in the income statement	12	10	12	10	—	—	12	10
Receivables and loans
- cash and cash equivalents	34,941	90,714	34,941	90,714	—	—	34,941	90,714
- trade receivables	135,422	136,163	133,093	133,699	2,329	2,464	135,422	136,163
- other financial assets	16,431	14,191	16,262	14,035	168	156	16,431	14,191
- receivables from affiliates and joint ventures	24,794	29,082	21,844	28,582	2,950	500	24,794	29,082
Available-for-sale financial assets	1,298	875	1,298	875	—	—	1,298	875
Derivatives	—	—	—	—	—	—	—	—

Total financial assets	212,898	271,035	207,450	267,915	5,447	3,120	212,898	271,035

Financial liabilities held to collect, measured at fair value with adjustments recognised in the income statement:
- non-hedge derivatives	—	—	—	—	—	—	—	—

Financial liabilities at amortised cost:
- trade payables	247,936	213,762	247,936	213,762	—	—	247,936	213,762
- payables to banks and other financial liabilities	238,976	275,795	119,726	152,966	119,250	122,828	229,408	279,684
- payables to associates and joint ventures	4,633	4,033	4,633	4,033	—	—	4,633	4,033
Derivatives	—	124	0'	—	—	124	—	124

Total Financial liabilities	491,545	493,714	372,295	370,761	119,250	122,952	481,977	497,603

Additionally, the Group has current and non-current financial liabilities represented by derivatives

explained in Note 28 "Net financial position", classified as Level 2; this scale concerns financial

instruments that are measurable using techniques for which all inputs that have a significant effect on

the recorded fair value are either directly or indirectly observable.

The table below summarizes income and expense recognised under the income statement and

attributable to financial assets and liabilities, classified according to the categories set out by IFRS 9.

302

2022 ANNUAL FINANCIAL REPORT


Profit and loss from financial instruments	31/12/2022	31/12/2021
(Euro/thousands)	31/12/2022	31/12/2021

Interest earned on financial assets not measured at fair value
- deposits	21	14
- other business	93	188
Total income	581	228

Net loss on derivative instruments	641	2,229
Interest due on financial liabilities not measured at fair value:
- deposits	7	11
- trade payables	205	94
- loans	1,114	320
- other	968	7

Losses from financial instrument impairment:
- trade receivables	4,033	6,566
Expense and commissions not included in effective interest rates	2,419	(116)
Total expense	9,387	9,111
Net profit (losses) on instruments measured at fair value with changes booked to the income statement	—	(448)
Total	(8,806)	(9,331)

42. FAIR VALUE MEASUREMENTS

Some of the Group's financial assets and liabilities were measured at fair value.


Financial assets (liabilities) (Euro/thousands)	Fair value at 31/12/2022	Fair value hierarchy	Measurement method and main inputs
Interest rate swap contracts	10.460	Level 2	Discounted cash flow. Future cash flows are discounted based on the forward rate curve expected at the end of the period and on the contractual fixing rates, also taking the counterparty default risk into account
Investments	1.298	Level 3	Fair value determined using measurement techniques with regard to market variables and unobservable data

43. OPERATING SEGMENTS

The disclosure required by IFRS 8 - Operating segments - is provided by taking account of the Group's

organizational structure, based on which the periodic reporting is made, used by Management to

define actions and strategies, evaluate investment opportunities and allocate resources; the picture

versus 2021 remained unchanged.

303

Mondadori Group Consolidated Financial Statements at 31 December 2022

Segment reporting: figures at 31 December 2022


(Euro/thousands)	Books	Retail	Media	Corporate & Shared Services	Unallocated items and consolidation adjustments	Consolidated result

Revenue from sales and services from external customers	535,101	188,414	178,290	41,525	(81,740)	903,003
Revenue from sales and services from other sectors	41,128	777	(493)	40,328	(81,740)	—

Gross operating margin	114,944	8,163	13,963	(6,397)	54	130,727

EBIT	88,588	(943)	869	(15,877)	54	72,691

Financial expense (income)	868	690	1,364	2,726	(13)	5,635
Expense (income) from equity-accounted investees	(2,952)	—	1,302		—	2,952
Result before tax and non-controlling interests	90,672	(1,634)	(1,798)	(20,452)	67	66,856

Income tax	—	—	—	15,313	—	15,313
Result attributable to non-controlling interests	(493)	—	(30)		(1)	(524)
Profit/(loss) from discontinued operations					—	—
Net profit	91,165	(1,633)	(1,768)	(35,765)	68	52,067

Amortisation, depreciation and write-downs	26,355	9,107	13,094	9,480	—	58,036
Non-monetary costs	20,844	4,304	1,618	22	—	26,788
Non-recurring income (expense)						—

Investments	55,062	11,222	11,830	4,544		82,659
Equity-accounted investees	16,605		11,845	—	—	28,450
Total assets	911,284	133,993	155,114	207,291	(401,035)	1,006,647
Total liabilities	302,982	127,645	129,704	582,907	(397,417)	745,821

304

2022 ANNUAL FINANCIAL REPORT


	Revenues from sales and services	Fixed assets

Italy	814,215	395,688
Other EU countries	27,900
USA	49,653	742
Other extra EU countries	11,235

Consolidated result	903,003	396,430

305

Mondadori Group Consolidated Financial Statements at 31 December 2022

Segment reporting: figures at 31 December 2021


(Euro/thousands)	Books	Retail	Media	Corporate & Shared Services	Unallocated items and consolidation adjustments	Consolidated result

Revenue from sales and services from external customers	424,820	173,207	208,427	40,896	(79,031)	807,345
Revenue from sales and services from other sectors	40,149	702	(1,824)	40,005	(79,031)	—

Gross operating margin	90,093	3,667	7,143	(9,630)	(132)	91,140

EBIT	73,986	(6,601)	(2,947)	(19,107)	(132)	45,199

Financial expense (income)	564	693	379	3,488	—	5,123
Expense (income) from equity-accounted investees	(2,051)	—	50	2,005	—	4
Result before tax and non-controlling interests	75,474	(7,295)	(3,375)	(26,106)	(132)	38,566

Income tax	—	—	—	(5,646)	—	(5,646)
Result attributable to non-controlling interests	6					6
Profit/(loss) from discontinued operations					—	—
Net profit	75,467	(7,295)	(3,375)	(20,460)	(132)	44,206
Amortisation, depreciation and write-downs	16,106	10,268	10,089	9,477	—	45,941
Non-monetary costs	26,380	3,482	8,237	1,585	—	39,684
Non-recurring income (expense)	300		10			310

Investments	172,560	4,696	17,805	1,924		196,985
Equity-accounted investees	4,183		12,475	1,200	—	17,859
Total assets	747,145	114,772	207,739	258,626	(305,702)	1,022,580
Total liabilities	277,380	113,856	172,072	540,951	(301,262)	802,998

306

2022 ANNUAL FINANCIAL REPORT


	Revenues from sales and services	Fixed assets

Italy	728,629	364,670
Other EU countries	26,165
USA	46,415	1,789
Other extra EU countries	6,136

Consolidated result	807,345	366,459

307

Mondadori Group Consolidated Financial Statements at 31 December 2022

44. EVENTS OCCURRING AFTER YEAR END

Disposal of Grazia and Icon

On 10 January 2023, the Mondadori Group, through the subsidiary Mondadori Media S.p.A., executed

the contract of sale to Reworld Media S.A. of the paper and digital publishing business of the titles

Grazia and Icon, as well as the related international licences network.

The execution of the transaction took place with the transfer of the business unit heading the

operations disposed of to a newly-incorporated company and the concurrent disposal to Reworld

Media of 100% of the share capital of the transferee.

Acquisition of A.L.I. S.r.l. - Agenzia Libraria International

On 13 January 2023, the Mondadori Group finalised, through its subsidiary Mondadori Libri S.p.A., the

acquisition of a further 25% stake in A.L.I. S.r.l. - Agenzia Libraria International, which operates in the

distribution of books.

The transaction - as a result of which the Mondadori Group increased its stake in A.L.I. S.r.l. - Agenzia

Libraria International, to 75%, which is therefore consolidated on a line-by-line basis as of 1 January

2023 - took place in accordance with the agreements defined and communicated on 11 May 2022 at

the time of the acquisition of an initial 50% stake, with an earlier effective date than the date originally

scheduled of 28 February 2023.

The provisional price, paid entirely in cash, was approximately € 9.5 million and was determined on

the basis of an average 2021-2022 EBITDA and the positive net financial position (cash) of the scope

covered by the transaction, which at 31 December 2022 amounted to € 17.8 million (preliminary

figure).

Additionally, the defined agreements gave the Mondadori Group the right to acquire the remaining

25% at a price to be determined on the basis of an average 2023-2024 EBITDA, through put&call

options exercisable by 30 July 2025.

45. INFORMATION PURSUANT TO ARTICLE 149-DUODECIS OF CONSOB

ISSUER REGULATION

Table drawn up pursuant to Article 149-duodecies of CONSOB Issuer Regulation, illustrating fees paid

in 2022 for auditing and other services provided by EY S.p.A. and by other entities belonging to the

same network.

308

RELAZIONE FINANZIARIA ANNUALE 2022


Service	Entity providing the service	Beneficiary of the service	Amount Euro/thousands
Auditing	EY S.p.A.	Arnoldo Mondadori Editore S.p.A.	419
	EY S.p.A.	Subsidiaries	613
Certification services (1)	EY S.p.A.	Arnoldo Mondadori Editore S.p.A.	39
	EY S.p.A.	Subsidiaries	100
Other services (2)	Other EY network entities	Arnoldo Mondadori Editore S.p.A.	66

Total			1,237
(1) Include audit of the Non-Financial Statement, Accertamento Diffusione e Stampa activities and other certification work (2) Include compliance endorsements on tax returns

46. INFORMATION PURSUANT TO LAW 124/2017 ARTICLE 1, PARAGRAPH

125bis

In 2022, the Group received the following amounts:

•€ 1,128 thousand, as a contribution pursuant to DG-MU Decree no. 407 of 7 April 2022;

•€ 5,248 thousand, as a contribution pursuant to DG-MU Decree no. 614 of 17 June 2022;

•€ 1,886 thousand, recognised for the costs incurred for the purchase of paper for printing

publications in 2019 and 2020, pursuant to Legislative Decree 19 May 2020, Article 188 and

subsequent amendments;

•€ 114 thousand, as a contribution, in the form of tax credit, for the purchase of electricity, pursuant to

Article 3 of Legislative Decree No. 21/2022;

•€ 7 thousand, as a contribution, in the form of tax credit, for the purchase of natural gas, pursuant to

Article 4 of Legislative Decree No. 21/2022.

47. OTHER INFORMATION

Effects of the conflict between Russia and Ukraine

Concerning the effects on the operating and financial situation resulting from the Russia-Ukraine war,

the Mondadori Group clarifies:

•to have no "direct" impacts, as it has no production sites in the affected area, nor does this area

represent an outlet market for publishing production or services offered by the Group;

•to have "indirect" impacts, due to the increase in prices of raw materials, energy and transportation.

As for the increase in paper prices, Mondadori has taken measures to optimize paper consumption by

reviewing sizes, weights and number of pages of certain products, fine-tuning print runs, acting, where

possible with a view to competition, on retail prices, and reviewed procurement policies.

Finally, Mondadori implemented further corrective actions aimed at achieving efficiencies.

309

Bilancio consolidato al 31 dicembre 2022 del Gruppo Mondadori

Effects resulting from climate change

The Group, by virtue of its sector, is not particularly exposed to the consequences of climate change;

however, it remains sensitive to these issues and has therefore implemented, or has planned to

implement, energy efficiency initiatives, aimed at reducing the emission of greenhouse gases (CO2).

In particular, Section 4.3 of the Non-Financial Statement, to which reference should be made, lists

these initiatives, which have been taken into account in the medium-term plan.

Macroeconomic impacts

Mondadori, by adopting a hedging policy for its medium- to long-term exposure, neutralised the

increases in interest rates resulting from the monetary policies implemented by central banks and the

consequent increase in the borrowing costs charged by credit institutions.

Modest effects were recorded by the Group in relation to the costs of very short-term financing (hot

money) with which the Group finances its exposure deriving from net working capital.

Overall, the cost (average interest rate) borne by the Group in the financial year 2022 was 0.47%.

As regards the impairment test, conducted for the purpose of verifying the sustainability of the book

values of certain asset items, it should be noted that the cash flows used incorporate the impacts of

the inflationary trend triggered by the macroeconomic scenario, while the discount rates reflect the

aforementioned increase in borrowing costs: by virtue of these factors, following the impairment test, it

was necessary to write down some intangible asset items, as illustrated in more detail in the note

relating to the impairment test (Note 11 ).

For the Board of Directors

The Chairman

Marina Berlusconi


	CERTIFICATION OF THE CONSOLIDATED FINANCIAL

CERTIFICATION OF THE CONSOLIDATED FINANCIAL

STATEMENTS PURSUANT TO ARTICLE 81-TER OF

CONSOB REGULATION NO. 11971 OF 14 MAY 1999 AS

SUBSEQUENTLY AMENDED AND SUPPLEMENTED

1. The undersigned Antonio Porro, in his capacity as CEO, and Alessandro Franzosi, in his capacity as

Financial Reporting Manager of Arnoldo Mondadori Editore S.p.A., also in compliance with the

provisions set out in Article 154-bis, paragraphs 3 and 4, of Legislative Decree no. 58 of 24 February

1998, hereby certify:

•the adequacy in relation to the characteristics of the company and

•the effective application

of the administrative and accounting procedures for the drafting of the Group’s consolidated financial

statements in 2022.

2.The assessment of the adequacy of the administrative and accounting procedures for the

preparation of the Group's consolidated financial statements at 31 December 2022 was carried out

based on a specific process defined by Arnoldo Mondadori Editore S.p.A. consistent with the Internal

Control – Integrated Framework model issued by the Committee of Sponsoring Organizations of the

Treadway Commission, which groups together a set of general principles of reference generally

accepted at the international level.

3. We also hereby certify that:

3.1 the Consolidated Financial Statements at 31 December 2022:

a.were drafted in compliance with the applicable international accounting standards

acknowledged at the EU level pursuant to EC regulation no. 1606/2002 of the EU Parliament

and Council of 19 July 2002, as well as with the provisions set out for the implementation of

Article 9 of Legislative Decree no. 38/2005;

b.agree with the results of the accounting records and entries;

c.provide a true and fair view of the statements of financial position and results of operations of

the Company and the group of businesses included in the consolidation scope.

3.2 the Report on Operations includes a reliable analysis of performance and results, of the situation of

the Company and of the businesses included in the consolidation scope, along with the description of

the main risks and uncertainties they are exposed to.

16 March 2023

Chief Executive Officer Financial Reporting Manager

Antonio Porro Alessandro Franzosi

312

2022 ANNUAL FINANCIAL REPORT

Acquisitions and new companies

In 2022, new entities joined the Mondadori Group and new companies were created. On this page, top-left: De Agostini Libri with

Claudio Cammarano, Mattia De Bernardis, Annachiara Tassan and Lorenzo Garavaldi; Zenzero Talent Agency with Lisa Bontempelli,

Ludovica Rozera, Alessandra Rigolio, Carolina Cefalù and Nicole Cavallo. Centre: Webboh with Diego Odello, Giulio Pasqui, Grazia

Gasperini and Ivan Buratti. Bottom: Star Comics with Claudia Bovini and Simone Bovini and the first line of D Scuola with Roberto Devalle,

Luca Vajani, Gian Luca Pulvirenti, Paolo Reniero. In 2022, the Mondadori Group also acquired A.L.I. Agenzia Libraria International, led by

the Belloni family.


	Arnoldo Mondadori Editore S.p.A. Financial Statements at 31 December 2022

STATEMENTS OF FINANCIAL POSITION


Assets	Notes	31/12/2022	31/12/2021
(Euro)	Notes	31/12/2022	31/12/2021

Intangible assets	1	5,621,515	5,868,896

Real estate		—	—
Land and buildings		—	—
Plant and equipment		835,109	1,014,412
Other tangible fixed assets		3,374,392	2,334,192
Property, plant and equipment	2	4,209,501	3,348,604

Assets from rights of use	3	27,329,409	42,226,590

Subsidiaries		661,816,879	526,568,867
Investments in joint ventures and associates		6,966,000	8,924,000
Other investments		1,100,745	677,137
Total investments	4	669,883,624	536,170,004

Non-current financial assets	5	10,960,331	552,966
Pre-paid tax assets	6	1,298,288	1,759,689
Other non-current assets	7	124,406	58,254
Total non-current assets		719,427,073	589,985,003

Tax receivables	8	8,762,619	9,402,000
Other current assets	9	3,051,610	2,618,056
Inventory		—	—
Trade receivables	10	13,758,677	12,280,257
Other current financial assets	11	24,490,256	23,107,314
Cash and cash equivalents	12	25,325,242	72,946,835
Cash and cash equivalents		75,388,405	120,354,462

Assets held for sale or transferred		—	—

Total assets		794,815,478	710,339,466

316

2022 ANNUAL FINANCIAL REPORT


Liabilities	Notes	31/12/2022	31/12/2021
(Euro)	Notes	31/12/2022	31/12/2021

Share capital		67,979,168	67,979,168
Treasury shares		(2,024,356)	(1,802,559)
Other reserves and results carried forward		141,540,194	109,186,234
Profit (loss) for the period		52,067,225	44,205,586
Total equity	13	259,562,231	219,568,430

Provisions	14	3,879,330	6,106,426
Post-employment benefits	15	1,828,590	1,904,100
Non-current financial liabilities	16	104,534,705	118,649,344
Financial liabilities IFRS 16	16	22,377,228	38,523,660
Deferred tax liabilities	6	4,519,500	1,687,961
Other non-current liabilities		—	—
Total non-current liabilities		137,139,353	166,871,491

Income tax payables		—	—
Other current liabilities	17	10,032,496	12,306,508
Trade payables	18	18,402,704	13,270,057
Payables to banks and other financial liabilities	16	364,393,177	293,046,671
Financial liabilities IFRS 16	16	5,285,517	5,276,310
Total current liabilities		398,113,894	323,899,545

Liabilities held for sale or transferred		—	—

Total liabilities		794,815,478	710,339,466


			317

Arnoldo Mondadori Editore S.p.A. Financial Statements at 31 December 2022

INCOME STATEMENTS


(Euro)	Notes	31/12/2022	31/12/2021

Revenue from sales and services	19	41,752,306	41,072,598

Decrease (increase) in inventory		—	—
Cost of raw and ancillary materials, consumables and goods	20	374,156	271,873
Cost of services	21	27,762,224	26,816,897
Cost of personnel	22	21,544,041	23,969,409
Other (income) expense	23	(1,244,362)	1,378,735

EBITDA		(6,683,754)	(11,364,317)

Amortization and impairment loss on intangible assets	1	2,633,692	2,729,677
Depreciation and impairment loss on property, plant and equipment	2	1,292,288	1,147,060
Amortization/depreciation and impairment loss of assets from rights of use	2	5,553,591	5,600,298

EBIT		(16,163,324)	(20,841,351)

Financial expense (income)	24	2,725,027	3,464,704
Expense (income) from investments	25	(67,471,434)	(65,292,367)

Result before tax		48,583,083	40,986,312

Income tax	26	(3,484,142)	(3,219,274)

Result from continuing operations		52,067,225	44,205,586

Result from discontinued operations		—	—

Net result		52,067,225	44,205,586

318

2022 ANNUAL FINANCIAL REPORT

STATEMENTS OF COMPREHENSIVE INCOME


(in Euro)	31/12/2022	31/12/2021

Net result	52,067,225	44,205,586

Items reclassifiable to income statement

Effective portion of income (loss) on cash flow hedge instruments	10,531,607	1,405,976
Tax effect	(2,527,586)	(337,434)
Items of the comprehensive income statement of investments measured at equity	1,774,771	1,897,717

Reclassified entries under income statement

Effective portion of income (loss) on cash flow hedge instruments	324,007	495,832
Tax effect	(77,762)	(119,000)

Items not reclassifiable to income statement

Actuarial income/ (losses)	80,519	53,544
Tax effect	(19,325)	(12,851)
Actuarial gains/(losses) from equity-accounted investees	321,434	(36,054)

Comprehensive net result	62,474,891	47,553,316

For the Board of Directors

The Chairman

Marina Berlusconi


			319

Arnoldo Mondadori Editore S.p.A. Financial Statements at 31 December 2022

STATEMENT OF CHANGES IN EQUITY AT 31 DECEMBER 2021 AND 2022


(Euro/thousands)	Share capital	Treasury shares	Performance share reserve	Discounting reserve - IAS 19 post- employment benefits	Cash flow hedge reserve	Other reserves	Result for the period	Total equity

Balance at 31/12/2020	67,979	(2,771)	2,144	513	(623)	100,664	4,503	172,409

Changes in:

- Allocation of result						4,503	(4,503)	—
- Purchase of treasury shares		(1,516)						(1,516)
- Provision Performance shares			1,110					1,110
- Granting Performance shares		2,484	(1,977)			(507)		—
- Other changes						11		11
- Comprehensive profit/(loss)				41	1,445	1,862	44,206	47,554

Balance at 31/12/2021	67,979	(1,803)	1,277	554	822	106,533	44,206	219,568

320

2022 ANNUAL FINANCIAL REPORT


(Euro/thousands)	Share capital	Treasury shares	Performance share reserve	Discounting reserve - IAS 19 post- employment benefits	Cash flow hedge reserve	Other reserves	Result for the period	Total equity

Balance at 31/12/2021	67,979	(1,803)	1,277	554	822	106,533	44,206	219,568

Changes in:

- Allocation of result						44,206	(44,206)	—
- Dividends						(22,161)		(22,161)
- Purchase of treasury shares		(757)						(757)
- Provision Performance shares			881					881
- Granting Performance shares		535	(427)			(109)		—
- Other changes						(444)		(444)
- Comprehensive profit/(loss)				61	8,250	2,096	52,067	62,475

Balance at 31/12/2022	67,979	(2,024)	1,731	615	9,073	130,122	52,067	259,562

For the Board of Directors

The Chairman

Marina Berlusconi

321

Arnoldo Mondadori Editore S.p.A. Financial Statements at 31 December 2022

STATEMENTS OF CASH FLOWS


Euro thousands	31/12/2022	31/12/2021

Net result	52,067	44,206
Adjustments
Amortization, depreciation and write-downs	9,480	9,477
Income tax for the period	(3,484)	(3,219)
Stock options	508	722
Provisions and post-employment benefits	(2,620)	425
Gains (losses) from disposal of intangible assets, property plant and equipment and investments	—	(390)
(Income)/expense from securities valuation	—	268
(Income)/expense from measurement of investments at equity	(67,471)	(65,292)
Net financial expense (income) on loans, leases and derivative transactions	4,160	3,876
Other non-monetary adjustments to discontinued operations	—	—
Cash flow generated from operations	(7,360)	(9,927)

(Increase) decrease in trade receivables	(1,482)	1,446
(Increase) decrease in inventory	—	—
Increase (decrease) in trade payables	4,097	(7,532)
(Payment) cash in from income tax	4,043	5,968
Increase (decrease) in provisions and post-employment benefits	401	(855)
Net change in other assets/liabilities	(2,031)	3,547
Net change in discontinued operations	—	—
Net change in contribution	—	—
Cash flow generated from (absorbed by) operations	(2,332)	(7,353)

Price collected (paid) net of cash transferred/acquired	—	—
(Purchase) disposal of intangible assets	(1,829)	(1,069)
(Purchase) disposal of property, plant and equipment	(1,675)	1,738
(Purchase) disposal of investments	(124,041)	(144,954)
(Purchase) disposal of discontinued operations	—	—
Income from investments - dividends	60,290	39,065
(Purchase) disposal of securities	—	4,924
(Purchase) disposal from contribution	—	—
Cash flow generated from (absorbed by) investing activities	(67,255)	(100,296)

Increase (decrease) in payables to banks for loans	(35,833)	29,467
Change in other financial assets - Intercompany	(934)	19,190
Change in other financial liabilities - Intercompany	(27,477)	(42,785)
(Purchase) disposal of treasury shares	(757)	(1,516)
Net change in other financial assets/liabilities	110,605	75,871
Dividends	(22,161)	—
Cash in of net financial income (payment of net financial expense) on loans and transactions in derivatives	(1,477)	(1,307)
Cash flow generated from (absorbed by) discontinued operations	—	—
(Purchase) disposal from contribution	—	—
Cash flow generated from (absorbed by) financing activities	21,966	78,920

Increase (decrease) in cash and cash equivalents	(47,621)	(28,729)

Increase (decrease) in cash from contribution	—	—

Cash and cash equivalents beginning of period	72,947	101,676

Cash and cash equivalents end of period	25,326	72,947

For the Board of Directors

The Chairman

Marina Berlusconi

322

2022 ANNUAL FINANCIAL REPORT

STATEMENTS OF FINANCIAL POSITION PURSUANT TO

CONSOB REGULATION NO. 15519 OF 27 JULY 2006


Assets			of which related parties		of which related parties
(Euro/thousands)	Notes	31/12/2022	(note 29)	31/12/2021	(note 29)

Intangible assets	1	5,622		5,869

Land and buildings		—		—
Plant and equipment		835		1,014
Other tangible fixed assets		3,374		2,334
Property, plant and equipment	2	4,210		3,349

Assets from rights of use	3	27,329		42,227
Investments	4	669,884		536,170
Non-current financial assets	5	10,960	500	553	500
Pre-paid tax assets	6	1,298		1,760
Other non-current assets	7	124		58
Total non-current assets		719,427	500	589,985	500

Tax receivables	8	8,763	4,758	9,402	4,754
Other current assets	9	3,052		2,618
Inventory		—		—
Trade receivables	10	13,759	13,307	12,280	12,046
Other current financial assets	11	24,490	24,475	23,107	23,099
Cash and cash equivalents	12	25,325		72,947
Cash and cash equivalents		75,388	42,540	120,354	39,899

Assets held for sale or transferred

Total assets		794,815	43,040	710,339	40,399

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2022 ANNUAL FINANCIAL REPORT

STATEMENTS OF FINANCIAL POSITION PURSUANT TO

CONSOB REGULATION NO. 15519 OF 27 JULY 2006


Liabilities		31/12/2022	of which related parties	31/12/2021	of which related parties
(Euro/thousands)	Notes		(note 29)		(note 29)

Share capital		67,979		67,979
Treasury shares		(2,024)		(1,803)
Other reserves and results carried forward		141,540		109,186
Profit (loss) for the period		52,067		44,206
Total equity	13	259,562		219,568

Provisions	14	3,879		6,106
Post-employment benefits	15	1,829		1,904
Non-current financial liabilities	16	104,535		118,649
Financial liabilities IFRS 16	16	22,377		38,524
Deferred tax liabilities	6	4,519		1,688
Other non-current liabilities		—		—
Total non-current liabilities		137,139		166,871

Income tax payables		—		—
Other current liabilities	17	10,032	2,542	12,307	2,530
Trade payables	18	18,403	650	13,270	482
Payables to banks and other financial liabilities	16	364,393	338,465	293,047	246,776
Financial liabilities IFRS 16	16	5,286		5,276
Total current liabilities		398,114	341,658	323,900	249,788

Liabilities held for sale or transferred		—		—

Total liabilities		794,815	341,658	710,339	249,788

325

Arnoldo Mondadori Editore S.p.A. Financial Statements at 31 December 2022

INCOME STATEMENT PURSUANT TO CONSOB

RESOLUTION NO. 15519 OF 27 JULY 2006


(Euro/thousands)		2022	of which related parties	of which non- recurring (income) expense	2021	of which related parties	of which non- recurring (income) expense
	Notes		(note 29)			(note 29)

Revenue from sales and services	19	41,752	41,516		41,073	40,945

Decrease (increase) in inventory		—	—		—	—
Cost of raw and ancillary materials, consumables and goods	20	374	138		272	11
Cost of services	21	27,762	219		26,817	(494)
Cost of personnel	22	21,544	(2,281)		23,969	(1,998)
Other (income) expense	23	(1,244)	—		1,379	1
EBITDA		(6,684)	43,439		(11,364)	43,427

Amortization and impairment loss on intangible assets	1	2,634	—		2,730	—
Depreciation and impairment loss on property, plant and equipment	2	1,292	—		1,147	—
Amortization/depreciation and impairment loss of assets from rights of use	2	5,554	—		5,600	—
EBIT		(16,163)	43,439		(20,841)	43,427

Financial expense (income)	24	2,725	(542)		3,465	(593)
Expense (income) from investments	25	(67,471)	(67,471)		(65,292)	(65,292)	(18,693)
Result before tax		48,583	111,453	—	40,986	109,312	18,693

Income tax	26	(3,484)	—		(3,219)	—
Result from continuing operations		52,067	111,453	—	44,206	109,312	18,693

Result from discontinued operations		—	—		—	—
Net result		52,067	111,453	—	44,206	109,312	18,693

326

2022 ANNUAL FINANCIAL REPORT

ACCOUNTING STANDARDS

AND EXPLANATORY NOTES

1. GENERAL INFORMATION

The core business of Arnoldo Mondadori Editore S.p.A. is Publishing in the areas of Trade Books,

Educational and Magazines, with the relating advertising sales, as well as Retailing through its directly-

managed and franchised stores. The Company has its registered office in Via Bianca di Savoia 12,

Milan, and headquarters in Strada privata Mondadori, Segrate/Milan.

The Company is present through the storage device on the www.1info.it website.

The draft financial statements of Arnoldo Mondadori Editore S.p.A. for the year ended 31 dicembre

2022 were approved by the Board of Directors on 16 March 2023 and made available, together with

the additional documents forming the Company’s Annual Report, pursuant to Article 154-ter of the TUF

(Finance Consolidation Act), and the Statutory Auditors’ and Independent Auditors’ Reports, within the

time limits established by current laws, at the registered office, at Borsa Italiana S.p.A. and on the

Company’s website.

The Company’s financial statements will be filed with the Company Registry within 30 days after the

Annual General Meeting called on 28 April 2023 to approve the 2022 financial statements.

Information pursuant to Article 2427, no. 22-quinquies, of the Italian Civil

Code

Arnoldo Mondadori Editore S.p.A. is part of the Fininvest Group, whose consolidated financial

statements are prepared by the parent Finanziaria d’Investimento Fininvest S.p.A.. A copy of the

consolidated financial statements of the Fininvest Group is filed with the registered office of

Finanziaria d’Investimento Fininvest S.p.A., in Largo del Nazareno 8, Rome.

2. FORM AND CONTENT

The financial statements at 31 dicembre 2022 were prepared in accordance with the International

Accounting Standards (IAS/IFRS) issued by the International Accounting Standard Board (IASB) and

endorsed by the EU, and with the International Financial Reporting Interpretations Committee (SIC/

IFRIC).

The financial statements were drawn up based on the historical cost, adjusted as requested to

evaluate a few financial instruments, and on a going concern basis. The Company has assessed that,

despite the challenging economic, financial and core market context, there are no significant

uncertainties (as defined by IAS 1. 25) surrounding its ability to continue operations, also as a result of

the actions undertaken to adjust to the changed market scenarios, and of its industrial and financial

flexibility.

Arnoldo Mondadori Editore S.p.A. adopted the body of the standards applied as from 1 January 2005,

following entry into force of European Regulation no. 1606 of 19 July 2002.

The financial statements at 31 dicembre 2022 were drawn up in accordance with the accounting

standards used for the preparation of the IAS/IFRS consolidated financial statements at 31 dicembre

2022, considering the amendments and the new standards effective as from 1 January 2022, as per

Note 3.25.

The following criteria were adopted in the drafting of these financial statements:

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RELAZIONE FINANZIARIA ANNUALE 2022

•current and non-current assets and current and non-current liabilities are shown separately in the

statements of financial position;

•in the separate income statement, the analysis of costs is carried out on the basis of the nature of

the costs, since the Company decided that this method is more representative than an analysis by

function;

•the comprehensive income statement contains revenue and cost items that are not recognised

under profit (loss) for the year as required or allowed by the other IAS/IFRS accounting standards;

•the statement of cash flows was prepared using the indirect method.

With regard to the requirements of CONSOB Resolution no. 15519 of 27 July 2006 concerning the

tables to the financial statements, specific supplementary tables were included to highlight significant

transactions with “Related parties” and “Non-recurring transactions”.

The amounts shown in the tables and in these notes are expressed in Euro thousands unless

otherwise stated.

3. ACCOUNTING PRINCIPLES AND VALUATION CRITERIA

The following is an explanation of the standards adopted by the Company in preparing the IAS/IFRS

financial statements at 31 dicembre 2022.

3.1 Intangible assets

When it is probable that costs will generate future economic benefits, intangible assets include the

cost, including ancillary expense, of the purchase of assets or resources, without any physical form,

used in the production of goods or in the supply of services, to rent to third parties or for

administrative purposes, on condition that the cost is quantifiable in a reliable manner and that the

goods are clearly identifiable and controlled by the company that owns them.

Costs incurred after the initial purchase are included in the increase of the cost of intangible assets in

direct relation to the extent to which those costs are able to generate future economic benefits.

Internal costs for producing publishing trademarks and for the launch of journalistic titles are

recognised in the income statement for the year in question.

Subsequent to initial recognition, intangible assets are measured at cost, net of accumulated

amortisation and any accumulated impairment loss.

Intangible assets purchased separately and those purchased as part of business combinations that

took place before the first-time adoption of IAS/IFRS were initially recognised at cost, while those

purchased as part of business combination transactions concluded after the first-time adoption of IAS/

IFRS are initially recognised at fair value.

The useful life of tangible and intangible assets is determined by the Directors when the asset is

purchased. The Company regularly assesses any changes in technology, market conditions and

expectations of future events that could have an impact on the useful life and duration of amortisation.

Intangible assets with finite useful life

The cost of intangible assets with finite useful life is systematically amortised over the useful life of the

asset from the moment the asset is available for use. The amortisation criteria depend on how the

relating future economic benefits contribute to the Company’s result.

329

Bilancio di esercizio al 31 dicembre 2022 di Arnoldo Mondadori Editore S.p.A.

The amortisation rates reflecting the useful lives attributed to intangible assets with finite useful life are

as follows:


Intangible assets with a finite useful life	Amortisation rates and useful life

Goods under concession or license	Term of the concession and license
Software and development costs	Straight line over 3 years
Patents and rights	Straight line over 3-5 years
Other intangible assets	Straight line over 3-5 years

Intangible assets with finite useful life are subject to an impairment test whenever there is an indication of

a possible impairment. The period and method of amortisation applied are reviewed at the end of each

year or more frequently, if necessary, whenever there are reasons to believe that changes have occurred.

Changes in the expected useful life or in the way future economic benefits linked to intangible assets

are expected to be earned by the Company, are recognised by modifying the period or method of

amortisation, and are treated as adjustments to accounting estimates.

Intangible assets with indefinite useful life

Intangible assets are considered to have indefinite useful life when, on the basis of a thorough

analysis of the relevant factors, there is no foreseeable limit to the length of time the assets may

generate income for the Company.

Goodwill represents the excess of the cost of a business combination over the Company’s purchased

share in the fair value of the assets and liabilities acquired, as identifiable at the time of purchase.

Goodwill and other intangible assets with indefinite useful life are not subject to amortisation but to an

impairment test of their book value. This test concerns the value of the individual assets or of the cash

generating unit and is carried out whenever it is believed that the value has decreased and in any

case at least once a year.

In cases where goodwill is attributed to a cash generating unit (or to a group of units) whose assets

are partly disposed of, goodwill associated with the asset disposed of is reviewed in order to

determine any capital gains or losses resulting from the transaction. In these circumstances, goodwill

disposed of is measured on the basis of the value of the assets disposed of, compared with the asset

still included in the cash generating unit in question.

3.2 Property, plant and equipment

Any costs attributable to the purchase of property, plant and equipment are recognised as assets, on

condition that the relevant costs can be reliably calculated and any relating future economic benefits

accrue to the entity.

Assets booked to property, plant and equipment are recognised based on the purchase method,

including any ancillary expense, and are stated net of depreciation and any impairment loss.

Costs incurred after the initial purchase are recognised as an increase in cost in direct relation to the

extent that these costs can improve the asset’s yield.

Assets booked to property, plant and equipment purchased as part of acquisitions and business

combinations are initially recognised at fair value as determined at the time of purchase and,

subsequently, at historical cost.

Assets booked to property, plant and equipment, with the exception of land, are depreciated on a

straight-line basis during the useful life of the asset from the moment the assets are available for use.

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2022 ANNUAL FINANCIAL REPORT

If the assets include more than one significant component and the components have different useful

lives, each individual component is depreciated separately.

The depreciation rates that generally reflect the useful lives attributed to Group property, plant and

equipment are shown in the table below:


Property, plant and equipment	Depreciation rate

Instrumental buildings	3%
Plant	10% - 25%
Machinery	15,5%
Equipment	12,5% - 25%
Electronic office equipment	30%
Office furniture, facilities and fittings	12%
Motor and transport vehicles	20% - 30%
Other tangible assets	20%

The residual value of assets, useful lives and depreciation criteria applied are reviewed on an annual

basis and adjusted, if necessary, at year end.

Leasehold improvements are recognised as fixed assets and depreciated over the lower of the

residual useful life of the asset and the residual term of the lease contract.

3.3 Rights-of Use-Assets