9M 2018 Earnings Results. November 13,

Transcription

1 9M 2018 Earnings Results November 13,

2 Table of Contents Financial and Operating Overview... 3 Consolidated Income Statement... 4 Revenue and Adjusted EBITDA... 6 Earnings per Share... 6 Revenue and Adjusted EBITDA at Constant Currency... 7 Operating Expenses... 8 Income Statement by Country Mexico... 9 Argentina Spain Italy Other Operations Consolidated Cash Flow Statement Capital Expenditures Consolidated Balance Sheet Net Working Capital Capitalization Gaming Capacity by Venue Gaming Capacity by Product Recent Events Contact Information

3 Financial and Operating Overview Herein, figures presented above Operating Profit (other than non-recurring items and impairment charges) are shown excluding the impact of non-recurring items as well as the impact resulting from the application of IAS 29. Adjusted EBITDA refers to EBITDA 1 excluding all non-recurring items and not considering Argentine figures according to IAS 29 standards (inflation accounting). 9M 2018 Operating Revenue decreased by 8.2% to 1,115.6 mm compared to 9M 2017, driven by a significant decline in our Argentine revenues due to the depreciation of Argentine Peso against the Euro, partially offset by revenue increases in Spain and Italy. In constant currency terms, Group Revenues for the period would have grown by 10.4% versus 9M M 2018 Adjusted EBITDA reached mm, 1.8% above 9M This increase is remarkable in a context of higher gaming taxes with respect to last year (Italy and Argentina) and significant FX headwinds, mainly in Argentina as the Euro appreciated 64.1% against the Peso, but also versus other Latin American currencies and the US Dollar. 9M 2018 Adjusted EBITDA margin was 18.3%, 1.8 percentage points above that of 9M 2017, driven by margin increases across all our Latin American operations. Non-recurring items in 9M 2018 were 30.8 mm. This exceptionally high figure is associated to the changes in the company leadership that took place in January 2018 and to the efficiencies deployed by the new leadership, at the corporate and local headquarters level. Given that inflation in Argentina reached more than 100% cumulatively over the last three years, the company has started to accrue results in this country following IAS 29 standards (inflation accounting) in Q To enable comparability with our previously reported numbers, we have broken down the impact in our income statement as follows: (i) Inflation adjustment as an operating expense (i.e. impact on EBITDA) of 19.2 mm in 9M 2018): reflects the net impact from applying end of period inflation and exchange rates on revenues and costs; (ii) Inflation adjustment as interest income ( 12.4 mm in 9M 2018), which partially offsets (i); and (iii) Inflation adjustment as higher corporate income tax ( 7.2 mm in 9M 2018). In order to calculate Adjusted EBITDA, the full amount under (i) is added back to EBITDA, together with non-recurring items. Inflation accounting under IAS 29 standards is affected by monthly inflation and end of period FX rates. Consequently, and given volatility in these parameters in Argentina, the impact of inflation accounting peaked on September 30 at 19.2 mm, to then unwind, as the Argentine Peso has appreciated progressively since then. Using FX and inflation figures as at October 31, the negative impact on EBITDA would have been reduced to 9.3 mm. Net profit in 9M 2018 has been negatively impacted by the evolution of exchange rates in our markets. We have registered a 32.8 mm FX loss in financial results that, together with non-recurring items and inflation accounting, generates a loss in what should otherwise be a 22m positive result. Capex in 9M 2018 was mm, 4.5% above that of 9M 2017, and included 55.4 mm of maintenance capex and 57.2 mm for growth projects, out of which c mm were incurred in new product agreements by which we have acquired a selection of successful leased slot products at attractive value creating positive returns, mostly in Mexico and Panama. These agreements include capex financing considerations to partially accommodate cash obligations to cash generation by these slots. As of September 30, 2018, we had mm in cash and equivalents and mm in total liquidity (i.e. including availability under the SSRCF) vs and mm as of December 31, This evolution is driven by a 9% increase in cash flow from operations (2% increase after investing), and a 33% decrease on financing, offset by a negative 8.9 mm exchange rate impact on cash balances. In terms of gaming capacity, the total number of slots increased 1.1% to 56,219 in 9M 2018, compared to 55,599 in 9M 2017, driven by the growth of the portfolio in Spain (+10.6%) and Mexico (+9.1%), partially offset by the reduction of machines in Argentina (-1.3%), Italy (-12.3%) and Other Operations (-7.5%). In terms of venues, gaming halls remained constant at 144, sports betting shops increased to 634 from 173 and bars decreased to 10,013 from 10,098 in 9M 2018 vs. 9M EBITDA, as defined by the Company, is operating profit (EBIT) plus depreciation and amortization, variation in provisions for trade transactions, gains / (losses) on asset disposals, and impairment charges. 3

4 Consolidated Income Statement 1 Figures in EUR mm, except where noted otherwise Quarter YTD YTD (5) Q Q Var. % Var. % 2018 Operating Revenue (11.2%) 1, ,115.6 (8.2%) 1,115.6 Operating Expenses (excl. D&A): Gaming & Other Taxes (146.3) (124.0) 15.2% (445.1) (402.0) 9.7% (402.0) Personnel (71.6) (59.7) 16.6% (223.8) (196.3) 12.3% (196.3) Rentals (31.5) (28.4) 9.7% (94.0) (86.6) 8.0% (86.6) Cost of Goods Sold (13.3) (13.8) (3.9%) (38.7) (39.8) (2.8%) (39.8) Other (69.9) (59.5) 14.9% (213.8) (187.3) 12.4% (187.3) Total (332.6) (285.5) 14.2% (1,015.5) (912.0) 10.2% (912.0) Depreciation & Amortization (26.9) (28.7) (6.7%) (82.2) (83.2) (1.2%) (83.2) Variation in Provisions for Trade Transactions (1) (0.1) (0.5) n.a. (0.5) (1.7) n.a. (1.7) Gains / (Losses) on Asset Disposals (2) 5.3 (0.5) n.a. 4.4 (1.9) n.a. (1.9) Impairment Charges n.a n.a. 0.0 Non-Recurring Items (6.0) (7.0) (16.0%) (16.5) (30.8) (87.0%) (30.8) Operating Profit (Pre-Inflation Accounting) (16.2%) (18.3%) 86.0 Inflation Adjustment (3) 0.0 (19.2) n.a. 0.0 (19.2) n.a. (9.3) Operating Profit (Post-Inflation Accounting) (63.3%) (36.5%) 76.7 Interest Expense (18.2) (17.8) 1.8% (55.6) (52.4) 5.8% (52.4) Interest Income (71.8%) (53.0%) 2.4 Loss on Debt for Equity Exchange n.a. (4.1) 0.0 n.a. 0.0 Gains / (Losses) from Financial Investments n.a. 0.0 (0.0) n.a. (0.0) Gains / (Losses) from Exchange Rate Variations (0.5) (10.4) n.a (32.8) n.a. (32.8) Inflation Adjustment (4) n.a n.a. 6.7 Earnings before Corporate Income Taxes 25.2 (0.0) n.a (3.6) n.a. 0.6 Provision for Corporate Income Taxes (15.1) (11.6) 23.2% (51.2) (39.2) 23.4% (39.2) Inflation Adjustment on CIT 0.0 (7.2) n.a. 0.0 (7.2) n.a. (8.4) Minority Interests in Subsidiary (Income) / Loss (1.3) (2.0) (50.2%) (15.8) (4.7) 70.2% (4.7) Equity in Affiliate Income / (Loss) (0.0) (0.2) n.a. (0.1) (0.5) n.a. (0.5) Net Income / (Loss) 8.7 (21.0) n.a. 8.3 (55.2) n.a. (52.1) EBITDA EBIT (Operating Profit) (63.3%) (36.5%) 76.7 (+) Impairment Charges 0.0 (0.0) n.a. 0.0 (0.0) n.a. (0.0) (+) (Gains) / Losses on Asset Disposals (5.3) 0.5 n.a. (4.4) 1.9 n.a. 1.9 (+) Variation in Provisions for Trade Transactions n.a n.a. 1.7 (+) Depreciation & Amortization % % 83.2 EBITDA (28.6%) (16.3%) EBITDA Margin 15.6% 12.5% (3.1 p.p.) 15.1% 13.8% (1.3 p.p.) 14.7% Adjusted EBITDA EBITDA (28.6%) (16.3%) (+) Non-Recurring Items % % 30.8 (+) Inflation Adjustment (3) n.a n.a. 9.3 Adjusted EBITDA % % Adjusted EBITDA Margin 17.1% 19.9% 2.8 p.p. 16.5% 18.3% 1.8 p.p. 18.3% Adjusted EBITDAR Adjusted EBITDA % % (+) Rentals (9.7%) (8.0%) 86.6 Adjusted EBITDAR (0.7%) (1.3%) Adjusted EBITDAR Margin 24.9% 27.8% 2.9 p.p. 24.2% 26.0% 1.8 p.p. 26.0% 1 Figures reflect change in provisions on advances to site owners for allowing Codere to install machines in their establishments; 2 Figures primarily reflect disposal of gaming machines; 3 Figure reflects, following IAS 29, the net impact on revenues and costs from applying Argentinean inflation and ARS/EUR exchange rate as of September 30, Figure includes the adjustment described above (footnote 3) plus the impact from applying end of period inflation on fixed assets. 5 Figures reflect, for illustrative purposes, September YTD figures if we were to apply IAS 29 with inflation and ARS/EUR exchange rate as of October 31,

5 Operating Revenue decreased by 99.9 mm or 8.2% to 1,115.6 mm in 9M 2018, due to the decrease in revenues in Argentina ( mm) and Mexico ( 9.7 mm), partially offset by Spain ( 26.8 mm) and Italy ( 6.2 mm). Operating Expenses (excluding depreciation and amortization) decreased by mm or 10.2% to mm, primarily due to a decrease in costs in Argentina and Mexico of 92.3 and 13.9 mm, respectively, partially offset by higher costs in Spain and Italy. Adjusted EBITDA increased 3.6 mm to mm, driven by increases across all markets except Argentina. In 9M 2018, the Adjusted EBITDA margin was 18.3%, 1.8 percentage points above that of 9M 2017, driven by margin expansions across all our Latam operations, partially offset by Spain. Adjusted EBITDAR 1 decreased by 3.9 mm or 1.3% to mm, driven by declines in Argentina and Mexico, partially offset by an increase in Spain. Losses on Asset Disposals were 1.9 mm in 9M 2018, compared to a 4.4 mm gain in 9M Non-Recurring Items in 9M 2018 totaled 30.8 mm of which 10.0 mm resulted from the management transition and related matters. The remaining 20.8 mm are mainly associated to operational efficiencies (primarily at headquarters level). Inflation Adjustment in 9M 2018 represents a loss of 19.2 mm (impact on EBITDA), due to the 29.4% inflation being more than offset by the 112.7% appreciation of the Euro against the Argentinean Peso in the YTD period. At the net income level, the impact is partially offset and results in a net loss of 14.0 mm. As shown in the table, the evolution of the ARS/EUR exchange rate from September 30 to October 31, from to 40.62, combined with a monthly inflation of 5.0%, have significantly mitigated impact of inflation accounting in the period to October 31, from an EBITDA loss of 19.2 mm to an estimated loss of 9.3mm (not including results for the month of October). Inflation accounting in the quarter reflects the full year to date impact as IAS 29 was not applied on halfyear results. Operating Profit decreased by 38.4 mm to 66.8 mm. The operating profit margin decreased to 6.0% in 9M 2018 from 8.7% in 9M 2017, as a result of the higher non-recurring expenses and the inflation adjustment. Excluding both impacts, impairment charges and gains (losses) from asset disposals, operating profit in 9M 2018 was mm, a 10.7% operating profit margin, 1.0 percentage point above that of 9M Interest Expense decreased by 3.1 mm to 52.4 mm, driven by the weaker dollar and lower outstanding OpCo debt. Interest income decreased by 2.8 mm to 2.4 mm. Losses on Exchange Rate Variations reached 32.8 mm in 9M 2018 versus gains of 24.6 mm in 9M 2017, driven by the significant depreciation of the Argentine Peso. Provision for Corporate Income Tax decreased by 12.0 mm to 39.2 mm in 9M 2018, primarily due to the devaluation of the Argentine Peso together with the high comparable last year as outlined in Q Minority Interest represents a loss of 4.7 mm in 9M 2018 compared to a loss of 15.8 mm in 9M 2017 due to the significant exchange rate gain in our Codere Caliente business in Q (i.e. prior to the acquisition). Equity in Affiliate Income represents a loss of 0.5 mm in 9M As a result of the aforementioned results, the Net Loss in 9M 2018 was 55.2 mm, compared to a Net Income of 8.3 mm in 9M Adjusted EBITDAR, as defined by the Company, is Adjusted EBITDA plus rental expenses. 5

6 Revenue and Adjusted EBITDA Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Revenue Argentina (34.9%) (26.4%) Mexico (3.3%) (3.8%) Panama (8.3%) (6.6%) Uruguay % % Colombia % (5.0%) Brazil (93.6%) (62.2%) Sub-Total - Latin America (19.5%) (15.8%) Italy (0.3%) % Spain % % Sub-Total - Europe % % Total (11.2%) 1, ,115.6 (8.2%) Adjusted EBITDA Argentina (33.4%) (24.3%) Mexico % % Panama % % Uruguay % % Colombia % % Brazil (1.3) (0.0) 99.1% (3.2) (0.2) 95.2% Sub-Total - Latin America (9.1%) (7.0%) Italy % % Spain % % Sub-Total - Europe % % Corporate (7.9) (3.2) 59.9% (24.3) (9.8) 59.5% Total % % 1 Earnings per Share Quarter YTD Q Q Var. % Var. % Earnings per Share Net Income / (Loss) (EUR mm) 8.7 (21.0) n.a. 8.3 (55.2) n.a. Average Shares Issued & Outstanding (1) (mm): Basic 2, (95%) 2, (95%) Earnings per Share (EUR): Basic 0.00 (0.18) n.a (0.47) n.a. 1 Figure excludes shares held in treasury stock (0.3 mm in 2017 and 20 thousand in 2018). 6

7 Revenue and Adjusted EBITDA at Constant Currency Constant Currency Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Revenue Argentina % % Mexico % % Panama (9.5%) % Uruguay % % Colombia % % Brazil (91.8%) (54.6%) Sub-Total - Latin America % % Italy (0.3%) % Spain % % Sub-Total - Europe % % Total % 1, , % Adjusted EBITDA Argentina % % Mexico % % Panama % % Uruguay % % Colombia % % Brazil (1.3) (0.1) 89.8% (3.2) (0.5) 84.8% Sub-Total - Latin America % % Italy % % Spain % % Sub-Total - Europe % % Corporate (7.9) (3.2) 59.9% (24.3) (9.8) 59.5% Total % % 7

8 Operating Expenses 1 Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var Var. Operating Revenue (11.2%) 1, ,115.6 (8.2%) Operating Expenses (excl. D&A): Gaming & Other Taxes (146.3) (124.0) 15.2% (445.1) (402.0) 9.7% Personnel (71.6) (59.7) 16.6% (223.8) (196.3) 12.3% Rentals (31.5) (28.4) 9.7% (94.0) (86.6) 8.0% Cost of Goods Sold (13.3) (13.8) (3.9%) (38.7) (39.8) (2.8%) Other (69.9) (59.5) 14.9% (213.8) (187.3) 12.4% Total (332.6) (285.5) 14.2% (1,015.5) (912.0) 10.2% Gaming & Other Taxes Gaming Taxes (120.3) (102.7) 14.7% (363.9) (331.7) 8.8% Other Taxes (25.9) (21.3) 17.9% (81.2) (70.3) 13.4% Total (146.3) (124.0) 15.2% (445.1) (402.0) 9.7% Rentals Gaming Venues & Other (20.5) (18.9) 8.0% (61.0) (56.7) 7.1% Slots (11.0) (9.6) 12.8% (33.0) (29.9) 9.5% Total (31.5) (28.4) 9.7% (94.0) (86.6) 8.0% Other Professional Fees (2) (9.4) (6.0) 35.8% (32.8) (17.1) 48.0% Advertising and Marketing (10.3) (10.1) 1.9% (33.4) (33.3) 0.1% Utilities (12.1) (12.1) 0.0% (34.7) (36.0) (3.7%) Repairs & Maintenance (3) (6.7) (6.6) 1.5% (21.9) (19.9) 9.1% Insurance (4) (1.1) (1.2) (5.0%) (3.7) (3.7) 0.4% Travel (1.0) (1.1) (12.5%) (3.3) (3.3) 1.4% Transportation (5) (0.7) (0.7) (8.1%) (2.1) (2.2) (8.3%) Other Expenses (28.7) (21.7) 24.2% (82.0) (71.8) 12.4% Total (69.9) (59.5) 14.9% (213.8) (187.3) 12.4% As % of Operating Revenue (Var. in p.p.) Operating Revenue 100% 100% - 100% 100% - Operating Expenses (excl. D&A): Gaming & Other Taxes 36.5% 34.8% (1.7) 36.6% 36.0% (0.6) Personnel 17.9% 16.8% (1.1) 18.4% 17.6% (0.8) Rentals 7.9% 8.0% % 7.8% 0.0 Cost of Goods Sold 3.3% 3.9% % 3.6% 0.4 Other 17.4% 16.7% (0.7) 17.6% 16.8% (0.8) Total 82.9% 80.1% (2.8) 83.5% 81.7% (1.8) Gaming & Other Taxes Gaming Taxes 30.0% 28.8% (1.2) 29.9% 29.7% (0.2) Other Taxes 6.5% 6.0% (0.5) 6.7% 6.3% (0.4) Total 36.5% 34.8% (1.7) 36.6% 36.0% (0.6) Rentals Gaming Venues & Other 5.1% 5.3% % 5.1% 0.1 Slots 2.7% 2.7% (0.1) 2.7% 2.7% (0.0) Total 7.9% 8.0% % 7.8% 0.0 Other Professional Fees (2) 2.3% 1.7% (0.7) 2.7% 1.5% (1.2) Advertising and Marketing 2.6% 2.8% % 3.0% 0.2 Utilities 3.0% 3.4% % 3.2% 0.4 Repairs & Maintenance (3) 1.7% 1.8% % 1.8% (0.0) Insurance (4) 0.3% 0.3% % 0.3% 0.0 Travel 0.2% 0.3% % 0.3% 0.0 Transportation (5) 0.2% 0.2% % 0.2% 0.0 Other Expenses 7.2% 6.1% (1.1) 6.7% 6.4% (0.3) Total 17.4% 16.7% (0.7) 17.6% 16.8% (0.8) 1 Figures exclude non-recurring items (some of which have been retroactively re-classified for 2017 as Professional Fees). 2 Figures exclude payments to personnel via outsourcing agreements in Mexico which are re-classified as personnel expense. 3 Includes cleaning services and general supplies consumed. 4 Includes insurance (including surety bonds) premiums and letter of credit fees. 5 Includes armored vehicles for route collections and other transportation costs. 8

9 Mexico Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Revenue (3.3%) (3.8%) Operating Expenses (excl. D&A): Gaming & Other Taxes (9.0) (8.6) 4.7% (27.6) (25.7) 6.8% Personnel (1) (15.4) (13.2) 14.0% (45.7) (40.6) 11.2% Rentals (17.5) (15.6) 10.8% (51.1) (46.5) 9.1% Cost of Goods Sold (4.1) (4.5) (9.4%) (12.2) (11.8) 3.1% Other (16.7) (15.8) 5.7% (50.0) (48.0) 3.9% Total (62.7) (57.7) 8.0% (186.5) (172.6) 7.5% Depreciation & Amortization (9.0) (10.2) (14.1%) (26.5) (29.1) (9.9%) Variation in Provisions for Trade Transactions n.a n.a. Gains / (Losses) on Asset Disposals (2) (0.2) (0.1) 68.9% (0.3) (0.4) (52.4%) Impairment Charges n.a n.a. Non-Recurring Items (1.4) (1.3) 5.0% (4.5) (4.8) (7.0%) Operating Profit % % EBITDA % % EBITDA Margin 26.0% 29.6% 3.6 p.p. 25.2% 27.7% 2.5 p.p. Adjusted EBITDA % % Adjusted EBITDA Margin 27.7% 31.2% 3.5 p.p. 26.9% 29.7% 2.8 p.p. Adjusted EBITDAR % (0.4%) Adjusted EBITDAR Margin 47.8% 49.8% 2.0 p.p. 46.9% 48.6% 1.7 p.p. Economic Indicators Average Exchange Rate - EUR/MXN % % Average Inflation (YoY) 6.5% 4.9% (1.6 p.p.) 5.9% 4.9% (0.9 p.p.) Key Performance Indicators Avg. Installed Capacity (Slots) 19,255 20, % 19,258 20, % Gross Win per Slot per Day: EUR (10.8%) (8.4%) Local Currency (6.1%) (0.9%) 1 Revenue in 9M 2018 decreased by 9.7 mm (3.8%) compared to 9M 2017, driven by growth of 4.1% in local currency, being offset by the 8.1% appreciation of the Euro against the Mexican Peso. Growth in local currency was the result of a 5.4% increase in average installed capacity, which was offset by a small decrease in unit yields. Operating Expenses (excluding D&A) in 9M 2018 decreased 7.5% or 13.9 mm compared to 9M 2017, above the decline in revenue, thanks to continuous cost containment efforts across all expenses, including rentals and personnel. Adjusted EBITDA increased by 6.1% to 72.9 mm as a result of the abovementioned efforts on the cost front offsetting the decline in revenue. Adjusted EBITDA margin increased 2.8 percentage points to 29.7% versus 26.9% in 9M In constant currency terms, Adjusted EBITDA in 9M 2018 would have reached 78.9 mm, an increase of 14.8% over the same period last year. 1 Includes personnel costs related to outsourced employees. 2 Figures reflect primarily disposal of gaming machines. 9

10 Argentina 1 Figures in EUR mm, except where noted otherwise Quarter YTD YTD (3) Q Q Var. % Var. % 2018 Operating Revenue (34.9%) (26.4%) Operating Expenses (excl. D&A): Gaming & Other Taxes (65.5) (42.1) 35.6% (203.9) (150.3) 26.3% (150.3) Personnel (22.3) (13.9) 37.4% (73.6) (51.3) 30.3% (51.3) Rentals (3.8) (2.4) 38.7% (12.3) (8.6) 30.0% (8.6) Cost of Goods Sold (2.3) (1.5) 36.8% (7.2) (5.2) 27.6% (5.2) Other (13.4) (9.5) 29.1% (43.6) (33.0) 24.4% (33.0) Total (107.3) (69.4) 35.3% (340.6) (248.4) 27.1% (248.4) Depreciation & Amortization (2.1) (1.2) 39.3% (6.9) (4.6) 34.1% (4.6) Variation in Provisions for Trade Transactions n.a n.a. 0.0 Gains / (Losses) on Asset Disposals (1) (0.0) (0.0) 34.3% 0.0 (0.4) n.a. (0.4) Impairment Charges n.a n.a. 0.0 Non-Recurring Items (3.2) (0.6) 82.6% (7.2) (2.5) 64.7% (2.5) Operating Profit (Pre-Inflation Accounting) (27.5%) (20.6%) 69.0 Inflation Adjustment (2) 0.0 (19.2) n.a. 0.0 (19.2) n.a. (9.3) Operating Profit (Post-Inflation Accounting) (93.6%) (42.7%) 59.7 EBITDA (90.0%) (41.6%) 64.7 EBITDA Margin 22.0% 3.4% (18.6 p.p.) 21.2% 16.9% (4.3 p.p.) 19.9% Adjusted EBITDA EBITDA (90.0%) (41.6%) 64.7 (+) Non-Recurring Items (82.6%) (64.7%) 2.5 (+) Inflation Adjustment (2) n.a n.a. 9.3 Adjusted EBITDA (33.4%) (24.3%) 76.5 Adjusted EBITDA Margin 24.2% 24.8% 0.6 p.p. 22.9% 23.5% 0.6 p.p. 23.5% Adjusted EBITDAR (33.9%) (24.9%) 85.1 Adjusted EBITDAR Margin 27.0% 27.4% 0.4 p.p. 25.7% 26.2% 0.5 p.p. 26.2% Economic Indicators Average Exchange Rate - EUR/ARS % % Average Inflation (YoY) 22.8% 35.3% 12.5 p.p. 26.7% 29.4% 2.7 p.p. Key Performance Indicators Avg. Installed Capacity (Slots) 6,952 6,861 (1.3%) 6,952 6,897 (0.8%) Gross Win per Slot per Day: EUR (34.8%) (25.3%) Local Currency 4,425 5, % 4,092 4, % Revenue in 9M 2018 decreased by mm or 26.4% compared to 9M 2017, due to the significant devaluation of the Peso (64.1%), which more than doubled inflation differentials. Revenue in local currency grew 17.3%, below year on year inflation of 29.4% 4, in part affected by the accounting impact in Q of the 0.95% cash-in tax introduced at the end of Q Average daily gross win per position in local currency terms increased 18.8% and installed capacity decreased slightly. Operating Expenses (excluding D&A) decreased by 27.1% driven by reductions across all cost items, including personnel, rentals and gaming taxes which benefitted from the FX trend; nonetheless, the effective gaming tax (as a percentage of revenue) increased 0.1 percentage points to 46.3%, as a result of the accounting impact of the new cash-in tax, which was implemented at the end of Q Adjusted EBITDA decreased by 24.3% to 76.5 mm, compared to mm in 9M 2017 as a result of the above mentioned devaluation of the Argentine Peso and the introduction of the cash-in tax, partially offset by efficiencies implemented in the last twelve months. The Adjusted EBITDA margin was 23.5% in 9M 2018, 0.6 percentage points above that of 9M 2017, due to the aforementioned reduction in costs. 1 Figures reflect primarily the disposal of gaming machines. 2 Figure reflects, following IAS 29, the net impact on revenues and costs from applying Argentinean inflation and ARS/EUR exchange rate as of September 30, Figures reflect, for illustrative purposes, September YTD figures if we were to apply IAS 29 with inflation and ARS/EUR exchange rate as of October 31, Codere estimate based on INDEC (Instituto Nacional de Estadísticas y Censos de la República Argentina). 10

11 Spain Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Revenue % % Operating Expenses (excl. D&A): Gaming & Other Taxes (15.4) (17.6) (14.1%) (45.8) (52.9) (15.6%) Personnel (11.2) (12.8) (14.4%) (32.6) (37.4) (14.9%) Rentals (2.0) (2.4) (17.8%) (5.6) (6.8) (21.0%) Cost of Goods Sold (3.4) (4.2) (24.2%) (9.0) (10.9) (20.8%) Other (9.0) (11.2) (24.6%) (25.7) (35.5) (37.7%) Total (41.0) (48.1) (17.5%) (118.7) (143.5) (20.8%) Depreciation & Amortization (6.2) (7.8) (25.6%) (17.9) (22.1) (23.4%) Variation in Provisions for Trade Transactions (1) (0.1) (0.3) n.a. (0.3) (0.9) n.a. Gains / (Losses) on Asset Disposals (2) (0.1) (0.3) n.a. (0.6) (0.9) (47.4%) Impairment Charges n.a n.a. Non-Recurring Items (0.4) (1.0) n.a. (0.6) (2.1) n.a. Operating Profit (0.7) (1.5) (95.5%) (2.8) (7.2) n.a. EBITDA % % EBITDA Margin 11.9% 12.3% 0.4 p.p. 11.9% 10.2% (1.7 p.p.) Adjusted EBITDA % % Adjusted EBITDA Margin 12.7% 14.0% 1.3 p.p. 12.3% 11.5% (0.8 p.p.) Adjusted EBITDAR % % Adjusted EBITDAR Margin 17.1% 18.3% 1.2 p.p. 16.5% 15.7% (0.8 p.p.) Key Performance Indicators Avg. Installed Capacity (Slots) 9,184 10, % 9,179 9, % Avg. Installed Capacity (Sports Betting Terminals) 4,414 6, % 4,206 5, % Gross Win per Slot per Day: Slots (3.6%) (1.9%) 1 Revenue in 9M 2018 grew by 26.8 mm (19.8%) compared to 9M 2017, driven by growing revenues in our online and retail sports betting business and, to a lesser extent, our slot and bingo businesses. Revenue in sports betting increased significantly on the back of an increase in deployed units of 42.4%, as well as higher volumes from the World Cup since half of the tournament took place in July. The growing revenue in the Slot Route business was driven by the 6.7% increase in installed capacity. Operating Expenses (excluding D&A) increased by 20.8% in 9M 2018 as a result of the increase in marketing spend for our Online and Sports Betting businesses, higher personnel and rental expense associated with further deployment of sports betting points of sale and other related expenses. Adjusted EBITDA grew 12.3% to 18.7 mm, as a result of the strong revenue growth across all verticals. Adjusted EBITDA margin decreased by 0.8 percentage points to 11.5%, versus the same period last year. During 9M 2018, we have completed several acquisitions, including 9 gaming halls, which collectively operate over 200 machines, for a total consideration of 7.0 mm and at EV/EBITDA multiples between 3.5x and 5.0x. 1 Figures reflect change in provisions on advances to site owners in connection with contracts to install our machines in their establishments. 2 Figures reflect primarily disposal of gaming machines. 11

12 Italy Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Revenue (0.3%) % Operating Expenses (excl. D&A): Gaming & Other Taxes (51.6) (51.1) 1.1% (152.3) (158.8) (4.3%) Personnel (8.2) (7.8) 4.2% (25.8) (25.9) (0.2%) Rentals (3.3) (3.2) 3.9% (10.1) (10.0) 1.1% Cost of Goods Sold (0.4) (0.4) (21.3%) (1.1) (1.4) (24.1%) Other (11.4) (10.4) 8.7% (33.3) (32.3) 3.2% Total (74.9) (72.9) 2.6% (222.6) (228.3) (2.6%) Depreciation & Amortization (4.1) (3.8) 6.6% (12.2) (11.5) 5.7% Variation in Provisions for Trade Transactions (1) 0.1 (0.5) n.a. (0.0) (0.5) n.a. Gains / (Losses) on Asset Disposals (2) 5.5 (0.0) n.a. 5.3 (0.0) n.a. Impairment Charges n.a n.a. Non-Recurring Items (0.6) (0.1) 88.9% (1.1) (1.0) 5.2% Operating Profit (63.4%) (49.1%) EBITDA % % EBITDA Margin 5.2% 8.1% 2.9 p.p. 6.8% 6.8% 0.0 p.p. Adjusted EBITDA % % Adjusted EBITDA Margin 6.0% 8.1% 2.1 p.p. 7.3% 7.3% - Adjusted EBITDAR % % Adjusted EBITDAR Margin 10.2% 12.2% 2.0 p.p. 11.5% 11.3% (0.2 p.p.) Key Performance Indicators Avg. Installed Capacity (AWPs) 8,635 7,704 (10.8%) 8,430 8,134 (3.5%) Avg. Installed Capacity (VLTs) 1,476 1,465 (0.8%) 1,472 1, % Gross Win per Slot per Day: AWPs % % VLTs % (0.7%) 12 Revenue in 9M 2018 increased by 6.2 mm or 2.6% compared to 9M 2017 mainly coming from the lower comparable last year given the accounting implications of the PREU increase in Q Average daily wins for AWPs increased 4.3% and those of VLTs declined 0.7%, while average installed capacity continues to reflect the reduction decreed by the Government (effective in May 2018). Operating Expenses (excluding D&A) increased by 2.6% in 9M 2018 compared to 9M 2017, as a result of the 4.3% increase in gaming taxes (due to the increase in tax rates effective since April 2017), while other costs remained relatively flat. Adjusted EBITDA was 17.9 mm in 9M 2018, 2.4% higher than in 9M Adjusted EBITDA margin was flat at 7.3%, reflecting our efforts to optimize AWP portfolio deployment and cost containment efforts to deliver growth despite capacity restrictions. 1 Figures reflect change in provisions on advances to site owners in connection with contracts to install our machines in their establishments. 2 Figures reflect primarily disposal of gaming machines. 12

13 Other Operations Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Revenue Panama (8.3%) (6.6%) Uruguay % % Colombia % (5.0%) Brazil (93.6%) (62.2%) Operating Revenue (3.0%) (4.4%) Adjusted EBITDA Panama % % Uruguay % % Colombia % % Brazil (1.3) (0.0) 99.1% (3.2) (0.2) 95.2% Adjusted EBITDA % % Adjusted EBITDA Margin 15.8% 23.7% 7.9 p.p. 14.3% 20.1% 5.8 p.p. EBITDA % % EBITDA Margin 15.4% 19.9% 4.5 p.p. 13.9% 15.6% 1.7 p.p. Average Exchange Rates EUR/USD (1.2%) % EUR/UYU % % USD/UYU % % EUR/COP 3,500 3,445 (1.6%) 3,281 3, % EUR/BRL % % Average Inflation (YoY) Panama 0.6% 1.1% 0.4 p.p. 1.1% 0.8% (0.2 p.p.) Uruguay 5.5% 8.3% 2.8 p.p. 6.2% 7.5% 1.3 p.p. Colombia 3.8% 3.2% (0.6 p.p.) 4.4% 3.2% (1.2 p.p.) Brazil 2.6% 4.4% 1.8 p.p. 3.7% 3.5% (0.2 p.p.) Other Operations includes results from Panama, Uruguay, Colombia and Brazil, but excludes Corporate Overhead. Operating revenue decreased by 6.3 mm (4.4%), to mm as a result of: A decrease in Panama of 4.7 mm due to the devaluation of the USD versus the Euro and the closing of a casino. A decrease in Colombia of 1.0 mm as a result of the closing of an underperforming gaming hall. A decrease in Brazil of 1.5 mm. Adjusted EBITDA increased by 7.0 mm (34.2%), to 27.5 mm as a result of: An increase in Uruguay of 2.3 mm due to a more efficient HRU operation together with a favorable evolution of exchange rates for our revenue recognition mechanics, while Carrasco continues to perform comfortably above break even. An increase in Brazil of 3.0 mm due to the reduced expenses in the country given our efficiency efforts. An increase in Panama of 1.3 mm, due to the lower local headquarter expenses and increased efficiency efforts. Adjusted EBITDA margin in 9M 2018 was 20.1%, 5.8 percentage points above that of 9M

14 Consolidated Cash Flow Statement 1 Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Operating Profit (63.3%) (36.5%) Non-Cash Items in Operating Profit: Impairment Charges n.a n.a. (Gains) / Losses on Asset Disposals (5.3) 0.5 n.a. (4.4) 1.9 n.a. Depreciation & Amortization % % Other Expenses (26.1%) (29.7%) Other Income (0.1) (0.3) n.a. (0.4) (0.5) (25.0%) Inflation Adjustment n.a n.a. Total n.a % Corporate Income Taxes Paid (12.5) (11.4) 8.8% (55.4) (40.6) 26.7% Chg. in Working Capital (1) (15.4) (2.7) 82.5% (12.4) (2.2) 82.3% Cash Flow from Operations % % Capital Expenditures (2) (36.1) (55.5) (53.7%) (107.8) (112.6) (4.5%) Proceeds from Asset Disposals n.a n.a. Initial Cash from Acquired Companies n.a n.a. Cash Flow from Investing (30.6) (55.5) (81.4%) (102.3) (112.6) (10.1%) Cash Interest Expense (6.5) (3.8) 41.5% (41.7) (37.7) 9.6% Cash Interest Income (40.0%) (40.0%) Chg. in Financial Debt (7.4) 16.9 n.a (1.3) n.a. Chg. in Financial Investments (3.3) (3.3) (34.7%) Chg. in Deferred Payments (3) n.a n.a. Dividends Paid, net (4) (0.2) (2.4) n.a. (4.4) (6.2) (40.9%) Investment in Treasury Shares, net n.a n.a. Cash Effect from Exchange Rate Difference 0.0 (1.8) n.a. (3.7) (5.5) (48.6%) Cash Flow from Financing (13.8) 30.2 n.a. (21.3) (14.2) 33.3% Exchange Rate Impact on Cash Balances (3.9) (2.9) 25.6% (6.8) (8.9) (30.9%) Cash Flow (11.7) 22.4 n.a. (8.2) (2.7) 67.2% Cash & Equivalents Beginning of Period (45.5%) (26.5%) Cash Flow (11.7) 22.4 n.a. (8.2) (2.7) 67.2% End of Period (24.0%) (24.0%) Cash flow from operations in 9M 2018 was mm, an 8.8% increase versus mm in 9M This increase is primarily attributable to (i) an increase in change in working capital and (ii) a decrease in corporate tax paid that offset the decrease of 29.9 mm in reported EBITDA. Inflation adjustments (IAS 29 accounting in Argentina) are excluded in the cash flow calculations, as they are non-cash items in the Income Statement. Cash flow from investing in 9M 2018 was mm of capital expenditures, of which 55.4 mm are related to maintenance and 57.2 mm to growth initiatives. Cash flow from financing was ( 14.2) mm and included: 37.7 mm of cash interest expense, including 26.3 mm related to our Senior Notes, 10.2 mm related to OpCo debt (including capital leases) and 1.2 mm related to our SSRCF; 1 Please see earnings results presentation for reconciliation between this figure and management reporting of net working capital. 2 Figures reflect accrued amounts, including contingency payments (if any), and prior to any deferred payment arrangements (if applicable). 3 Includes changes in deferred payments related to capital expenditures and authorized deferred gaming taxes (Spain). 4 Figure reflects dividends paid to minority partners net of dividends received from Group investments in unconsolidated entities. 14

15 1.5 mm of cash interest income; 1.3 mm decrease in financial debt made up of: (i) 1.3 mm decrease in capital leases, primarily in Spain; (ii) Flat OpCo financial debt (excluding capital leases), due to the net effect of loans raised in Uruguay HRU ( 10.1 mm), Panama ( 11.2 mm) and Spain ( 4.4 mm) offset by the scheduled amortization of loans in HRU ( 3.3 mm), Mexico ( 16.5 mm), Uruguay Carrasco ( 4.3 mm), Italy ( 0.9 mm) and Colombia ( 0.7mm); 4.7 mm decrease in financial investments; Increase in deferred payments of 30.3 mm, consisting of a decrease in authorized deferred gaming taxes in Spain of 1.3 mm and an increase in deferred payments with capex suppliers of 31.6 mm mainly in Mexico and Panama (mainly associated to new supplier financing deals on acquired slot products previously leased); Dividends paid to minority partners of 6.2 mm; 5.5 mm net negative impact from exchange rate differences; The fluctuation in foreign exchange rates has resulted in a negative impact of 8.9 mm on conversion of cash balances; During 9M 2018, there has been a decrease in cash and equivalents of 2.7 mm to mm. 15

16 Capital Expenditures 1 Figures in EUR mm, except where noted otherwise Quarter YTD Q Q Var. % Var. % Capital Expenditures Maintenance (2) (51.0%) (0.9%) Growth (3) n.a % Total % % Maintenance Argentina (59.0%) % Mexico (62.7%) % Panama (81.3%) (75.5%) Colombia (30.0%) % Uruguay n.a % Brazil n.a n.a. Sub-Total - Latin America (62.7%) % Italy (20.0%) (48.0%) Spain (25.6%) (11.7%) Sub-Total - Europe (24.1%) (20.2%) Corporate n.a n.a. Total (51.0%) (0.9%) Growth Argentina n.a n.a. Mexico n.a % Panama n.a n.a. Colombia (76.9%) (5.6%) Uruguay n.a n.a. Brazil n.a n.a. Sub-Total - Latin America n.a % Italy n.a (98.1%) Spain (8.3%) % Sub-Total - Europe (10.5%) (19.2%) Corporate n.a n.a. Total n.a % Maintenance Capex in 9M 2018 reached 55.4 mm, principally driven by: Investment in Mexico of 20.8 mm, an increase of 5.9 mm, associated with slot renewals and hall refurbishments; Spanish investment of 14.4 mm, a decrease of 1.9 mm, due to lower levels of product renewal in our retail AWP business, partially offset by higher commercial capex; Investment in Argentina of 6.7 mm, an increase of 1.2 mm, due to investment in slot renewals and investments in halls, including VIP areas within them; Investment in Uruguay of 5.6 mm, an increase of 2.5 mm. Growth Capex in 9M 2018 was 57.2 mm, 5.3 mm higher than in 9M 2017 and included c mm incurred in new product agreements by which we have acquired a selection of successful leased slot products to improve our operational and financial returns, mostly in Mexico and Panama. These agreements include capex financing considerations to partially accommodate cash obligations to cash generation by these slots. 1 Figures as per consolidated cash flow statements. Figures will vary from prior reports as investments related to our online and sports betting platform in Spain have been reclassified from maintenance to growth capex retroactively since Q Includes primarily slot product/gaming hall renovation, exclusivity payments to site owners and gaming license renewals. 3 Includes primarily slot product/gaming hall expansion and acquisition activity. 16

17 Consolidated Balance Sheet 1 Figures in EUR mm, except where noted otherwise As at Dec-17 Sep-18 Var. Var. % Assets Cash & Equivalents (2.7) (2.6%) S-T Financial Investments (1) (3.0) (7.7%) Accounts Receivable (2) (8.3) (9.1%) Taxes Receivable (3) (12.7) (14.5%) Prepaid Expenses % Inventory % Other Current Assets n.a. Current Assets (20.5) (5.9%) Fixed Assets % L-T Financial Investments % Intangible Assets (excl. Goodwill) % Goodwill % Deferred Tax Assets (1.8) (3.7%) Other Non-Current Assets n.a. Total Assets 1, , % Liabilities & Shareholders' Equity Accounts Payable (4) (9.8) (8.4%) S-T Provisions (5) (2.3) (33.8%) S-T Taxes Payable (6) (27.5) (17.3%) S-T Financial Debt % S-T Deferred Payments (7) % Other Current Liabilities % Current Liabilities (8.6) (2.2%) L-T Provisions (8) (3.3) (10.4%) L-T Taxes Payable (4.0) (23.0%) L-T Financial Debt % L-T Deferred Payments (7) % Deferred Tax Liabilities % Other Non-Current Liabilities (26.3%) Total Liabilities 1, , % Minority Interests % Shareholders' Equity (78.8) (60.6) % Total Liabilities & Shareholders' Equity 1, , % End of Period Exchange Rates EUR/ARS % EUR/MXN (1.99) (8.4%) EUR/USD (0.04) (3.5%) EUR/COP 3,579 3,461 (118) (3.3%) EUR/UYU % USD/UYU % EUR/BRL % 2 1 Includes 6.3 and 5.9 mm, respectively, in cash in transit (including Codere participation in realized gross win pending route operator collection). 2 Includes A/R from customers, other parties and advances to employees. 3 Includes all taxes receivable from tax authorities, including the 0.5% canon (AAMS) in Italy. 4 Includes accounts payable to suppliers, other parties and accrued wages. 5 Figures include provision for trade transactions and other provisions related to treasury share activity. 6 Figures include gaming taxes, corporate income taxes and other taxes payable to tax authorities. 7 Figures include deferred payments (and other partner investments) related to capital expenditures and other deferred payments. 8 Figures include all other provisions related to business contingencies (personnel, tax, etc.). 17

18 Net Working Capital Figures in EUR mm, except where noted otherwise As at Dec-17 Sep-18 Var. Var. % Assets Accounts Receivable (8.3) (9.1%) Taxes Receivable (1) % Prepaid Expenses % Inventory % Other Current Assets (2) Total (1.6) (1.0%) Liabilities Accounts Payable (8.4%) S-T Provisions (3) (25.9%) Taxes Payable (1) (8.3%) Deferred Payments (4) (2.9) 77.4% Other Current Liabilities (2) (12.6%) Total (7.4%) Net Working Capital (84.8) (67.8) % 1 Balance Sheet Total assets increased by 63.0 mm in 9M This increase is principally attributable to fixed and intangible assets, as a result of (i) the increase in value of Argentinean assets following the application of IAS 29 and (ii) the increase in Mexico and Panama following the acquisition of slots, as outlined in the Capital Expenditures section of this report. Current Assets decreased by 20.5 mm, as a result of a 5.7 reduction in cash and short term financial investments, a 12.7 mm reduction in taxes receivable and an 8.3 mm reduction in accounts receivable. Financial debt, including both the short and long term portion increased by 23.1 mm as a result of the 24.1 mm increase in the USD denominated Senior Notes due to the 3.5% appreciation of the USD against the Euro partially offset by a small reduction in OpCo debt (including capital leases). Minority interests increased by 8.1 mm to 91.9 mm and shareholders equity increased by 18.2 mm to ( 60.6) mm. Net Working Capital Net working capital increased by 17.0 mm to negative 67.8 mm. This change in net working capital was primarily due to a 9.8 mm decrease in accounts payable and a 10.9 mm decrease in taxes payable, net 5, partially offset by a 8.3 mm decrease in accounts receivable. 1 Figures reflect gaming and other taxes (i.e. exclude corporate income taxes). 2 Figures exclude security deposits. 3 Figures reflect provisions for trade transactions. 4 Figures reflect other deferred payment obligations (i.e. exclude deferred payments and other partner investments related to capital expenditures). 5 Taxes payable less taxes receivable. 18

19 Capitalization 1 Figures in EUR mm, except where noted otherwise As at Dec-17 Sep-18 Var. Var. % Capitalization S-T Financial Debt (1) % L-T Financial Debt (1) % Total Financial Debt % Minority Interests % Shareholders' Equity (78.8) (60.6) % Total Capitalization % Financial Debt (1) OpCo Debt (excl. Capital Leases) % OpCo Capital Leases (2.7) (36.7%) Sub-Total (1.1) (1.2%) Super Senior Revolving Credit Facility % Senior Notes % Total Financial Debt % Capitalization of Operating Leases (2) (29.9) (6.0%) Total Adjusted Financial Debt 1, ,346.6 (6.7) (0.5%) Cash & Equivalents Argentina (6.8) (37.2%) Mexico % Spain % Italy (1.3) (8.0%) Other Operations (1.4) (8.9%) Sub-Total (4.1) (5.3%) Corporate % Total (2.7) (2.6%) Europe (incl. Corporate) % Latam (3.2) (6.5%) Total (2.7) (2.6%) Credit Statistics LTM Adjusted EBITDA % LTM Adjusted EBITDAR (3.9) (1.0%) Proforma Interest Expense (3) % Leverage: Senior Financial Debt (4) / LTM Adjusted EBITDA 0.4x 0.4x (0.0x) (2.1%) Total Financial Debt / LTM Adjusted EBITDA 3.1x 3.2x 0.0x 1.4% Total Adjusted Financial Debt / LTM Adjusted EBITDAR 3.4x 3.4x 0.0x 0.5% Total Net Financial Debt / LTM Adjusted EBITDA 2.7x 2.8x 0.1x 2.1% Including Inflation Accounting 2.7x 3.0x 0.3x 9.7% Coverage: LTM Adjusted EBITDA / Proforma Interest Expense 4.6x 4.6x 0.0x 0.8% Including Inflation Accounting 4.6x 4.3x (0.3x) (6.2%) 1 Figures include accrued interest and impact of deferred financing fees, which, for covenant calculation purposes, would be excluded (i.e. financial debt and leverage would be lower). 2 Figures reflect 4.0x multiple on LTM rental expenses, as per Moody's Investor Services methodology (Operating Lease Adjustments Treatment, Rationale and Sector Data for Retail, Restaurants, Gaming, Lodging & Apparel, dated June 14, 2016). 3 Figures based on December 31, 2017 and September 30, 2018, as applicable, financial debt outstanding and interest rates; excludes fees on unused revolver availability. 4 Includes structurally senior OpCo debt (including capital leases) plus drawn amounts outstanding under the 95 mm SSRCF. 19

20 Gaming Capacity 1 by Venue Gaming Venues Sports Gaming Halls (2) Arcades (3) Bars (4) Betting Shops (5) Racetracks Total Region Latin America Argentina Co-located Mexico (6) Panama (6, 7) Colombia Uruguay (CN) Uruguay (HRU) (8) Brazil Total Europe Italy ,458 2, ,469 2,262 Spain (9) ,640 7, ,209 8,769 Total ,098 10, ,678 11,031 Total Group ,085 10,098 10, ,011 11,345 Operator Codere "Corners" Third Party ,098 10, ,598 11,188 Total ,085 10,098 10, ,011 11,345 Spain SSTs Only (10) ,135 1, ,663 2,014 AWPs & SSTs Sub-Total ,493 1, ,062 2,483 AWPs Only ,147 6, ,147 6,286 Total ,640 7, ,209 8,769 1 Figures as at September 30, 2017 and 2018, as applicable. 2 Includes all gaming venues with > 50 slot machines. 3 Includes all gaming venues with between 5 and 50 (inclusive) slot machines (Codere and/or 3 rd party operated). 4 Includes all bars, restaurants, tobacco shops and other retail locations with < 5 slot machines and/or self-service sports betting terminals. 5 Includes sports books co-located within Codere gaming halls and other Codere operated standalone sports betting shops. 6 Figure for sports betting shops reflects sports books co-located within Codere operated gaming halls. 7 Figure for sports betting shops excludes 41 and 38, respectively, affiliated agencies (horserace betting only). 8 Figure for sports betting shops includes 5 sports books co-located within HRU operated gaming halls. In Colombia, other than those located in arcades, sport betting shops reflect standalone points of sale. 9 Sports betting shops excludes 26 and 42, respectively, franchised locations (included in Arcades). 10 Self-service sports betting terminals; arcades and bars would, however, typically have 3 rd party operated AWPs. 20

21 Gaming Capacity 1 by Product Gaming Product (Installed Capacity) Slots (2) Table Seats (3) Bingo Seats Sports Betting (4) Network (5) Total Region Latin America Argentina 6,952 6, ,906 11, ,858 18,553 Mexico 19,041 20,772 1,896 2,112 11,117 11, ,141 34,089 Panama (6) 3,135 2, ,551 3,393 Colombia 5,342 4, ,456 5,997 Uruguay (CN) Uruguay (HRU) 1,863 1, ,892 1,889 Brazil Total 36,736 37,565 2,712 2,832 23,873 23, ,449 64,468 Europe Italy: (7) 9,654 8, ,142 5, ,505 15,292 28,863 21,608 AWP (8) 8,704 7, ,016 13,836 22,179 14,967 VLT (9) ,489 1,456 1,542 1,502 Spain (10) 9,209 10, ,193 4,561 6, ,563 17,969 Total 18,863 18, ,935 6,332 4,561 6,593 22,505 15,292 43,426 39,577 Total Group 55,599 56,219 2,712 2,832 29,808 29,566 4,689 7,430 22,505 15, , ,045 Gaming Venue Gaming Halls 33,574 35,001 2,712 2,832 29,808 29, ,238 68,260 Arcades 4,592 4, ,764 4, ,356 9,266 Bars 17,363 16, ,493 1, ,856 17,919 Sports Betting Shops Network (11) ,505 15,292 14,067 7,998 Total Group 55,599 56,219 2,712 2,832 29,808 29,566 4,689 7,430 22,505 15, , ,045 1 Figures as at September 30, 2017 and 2018, as applicable. 2 Includes all Codere operated AWPs, VLTs, electronic bingo terminals and other gaming machines; excludes 3 rd party operated slots. 3 Figure reflects number of total gaming positions assuming (for illustrative purposes only) 6 seats per table. 4 Figures for Spain and Colombia reflect self-service terminals (SSTs); in other markets figure reflects number of sports books/betting shops. 5 Reflects all slots connected to Codere network (i.e. both Codere and 3 rd party operated). 6 Figure for sports betting shops excludes 41 and 38, respectively, affiliated agencies (horserace betting only). 7 Figures for slots reflect Codere operated units connected to both Codere Network (typical) and 3 rd party networks. 8 Figures for slots include 1,163 and 1,131 units, respectively, connected to 3 rd party networks. 9 Figures for slots include 53 and 46 units, respectively, connected to 3 rd party networks. 10 Figures for slots reflect operating units (i.e. do not include authorized but not deployed units). 11 Figures in total column reflect only 3 rd party operated slots that are connected to Network (to avoid double counting of Codere operated units). 21