B2W Companhia Digital. Financial statements ITR at September 30, 2017 and independent auditors report on quarterly information

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1 B2W Companhia Digital Financial statements ITR at and independent auditors report on quarterly information 1

2 Financial statements ITR at and independente autitors report on quarterly information KPMG Auditores Independentes Rua do Passeio, 38-17º andar - Centro Rio de Janeiro/RJ - Brasil Caixa Postal CEP Rio de Janeiro/RJ - Brasil Telefone 55 (21) , Fax 55 (21) Review report on Quarterly Information (A free translation of the original report in Portuguese, as filed with the Brazilian Securities and Exchange Commission (CVM), prepared in accordance with the accounting practices adopted in Brazil, rules of the CVM and the International Financial Reporting Standards - IFRS) To Management and Stockholders of B2W Companhia Digital Rio de Janeiro - RJ Introduction We have reviewed the individual and consolidated interim accounting information of B2W Companhia Digital ( Company ), included in the quarterly information form - ITR for the quarter ended, which comprises the balance sheet as of and the respective statements of operations and comprehensive income (loss) for the three-month and nine-month periods then ended, changes in shareholders equity and cash flows for the nine-month period then ended, including explanatory notes. The Company s Management is responsible for the preparation of the interim accounting information in accordance with the Accounting Pronouncement CPC 21(R1) and the international accounting rule IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board - IASB, as well as the presentation of this information in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM), applicable to the preparation of quarterly information - ITR. Our responsibility is to express our conclusion on this interim accounting information based on our review. 2

3 Financial statements ITR at and independente autitors report on quarterly information Scope of the review We conducted our review in accordance with Brazilian and International Interim Information Review Standards (NBC TR Revisão de Informações Intermediárias Executada pelo Auditor da Entidade and ISRE Review of Interim Accounting Information Performed by the Independent Auditor of the Entity, respectively). A review of interim information consists of making inquiries primarily of the management responsible for financial and accounting matters and applying analytical procedures and other review procedures. The scope of a review is significantly less than an audit conducted in accordance with auditing standards and, accordingly, it did not enable us to obtain assurance that we were aware of all the significant matters that could have been identified in an audit. Therefore, we do not express an audit opinion. Conclusion on the individual interim accounting information Based on our review, we are not aware of any fact that might lead us to believe that the individual interim accounting information included in the aforementioned quarterly information were not prepared, in all material respects, in accordance with the Accounting Pronouncement CPC 21(R1) applicable to the preparation of the quarterly review - ITR and presented in accordance with the standards issued by the Brazilian Securities and Exchange Commission. Conclusion on the consolidated interim accounting information Based on our review, we are not aware of any fact that might lead us to believe that the consolidated interim accounting information included in the aforementioned quarterly information were not prepared, in all material respects, in accordance with the Accounting Pronouncement CPC 21(R1) and international accounting rule IAS 34, issued by the IASB applicable to the preparation of the quarterly review - ITR, and presented in accordance with the standards issued by the Brazilian Securities and Exchange Commission. Other matters Statements of added value We also reviewed the individual and consolidated Statements of added value (DVA) for the ninemonth period ended, prepared under the responsibility of Company s Management, for which presentation is required in the interim information in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of quarterly information - ITR, and considered as supplementary information by IFRS, which does not require the presentation of the statements of added value. These statements were submitted to the same review procedures described previously and, based on our review, we are not aware of any fact that might lead us to believe that they were not prepared, in all material respects, in accordance with the individual and consolidated interim accounting information, taken as a whole. 3

4 Financial statements ITR at and independente autitors report on quarterly information Rio de Janeiro, October 27, 2017 KPMG Auditores Independentes CRC SP /O-6 F-RJ Original in Portuguese signed by Carla Bellangero Contadora CRC 1SP196751/O-4 4

5 Financial statements ITR at and independente autitors report on quarterly information ASSETS 09/30/ /31/ 09/30/ /31/ CURRENT Cash and cash equivalents 1,421, ,112 1,422, ,248 Marketable securities 1,847,515 1,452,747 2,354,871 1,742,541 Accounts receivables 388, , , ,083 Inventories 1,016,436 1,518,638 1,050,989 1,541,324 Recoverable taxes 284, , , ,343 Prepaid expenses 26,894 31,793 34,503 51,952 Other current assets 495, , , ,909 Total current assets 5,480,852 4,519,715 6,119,346 4,936,400 NON CURRENT Long-term assets: Marketable securities - 35, Recoverable taxes 1,136,406 1,067,452 1,136,406 1,067,452 Deferred income tax and social contribution 869, , , ,770 Judicial deposits 30,265 17,550 30,352 17,707 Related parties 71,143 62, Other non current assets 67,093 67,188 73,525 73,620 Investments 504, , Fixed assets 463, , , ,290 Intangible 2,407,206 2,375,029 2,915,180 2,885,110 Total non current assets 5,549,105 5,293,048 5,568,027 5,304,949 TOTAL ASSETS 11,029,957 9,812,763 11,687,373 10,241,349 5

6 Balance Sheet In thousands of reais (continued) LIABILITIES AND SHAREHOLDERS' EQUITY 09/30/ /31/ 09/30/ /31/ CURRENT Suppliers 771,540 1,966, ,196 2,107,960 Borrowings and financing 1,304, ,165 1,638, ,129 Debentures 21, , Salaries, provisions and social contributions 40,602 45,717 66,630 65,341 Accounts payable - Business combination 13,562 12,555 20,281 36,229 Taxes payable 14,655 49,840 27,341 68,400 Income tax and social contribution ,196 5,252 Advances received from clients 24,233 35,798 24,233 35,798 Other current liabilities 97, , , ,555 Total current liabilities 2,287,453 2,710,087 2,863,842 3,119,426 NON CURRENT LIABILITIES Long-term liabilities: Borrowings and financing 4,260,106 3,527,560 4,260,106 3,539,288 Debentures 200, , , ,000 Provisions for contingencies 60,008 55, , ,212 Related parties 258, , ,641 81,820 Accounts payable - Business combination 12,153 11,250 19,395 27,395 Other non current liabilities 17,227 16,053 17,826 16,206 Total non current liabilities 4,808,203 4,024,724 4,889,391 4,043,921 SHAREHOLDERS' EQUITY Capital 5,707,298 4,483,041 5,707,298 4,483,041 Capital reserve 47,636 38,927 47,636 38,927 Carrying value adjustments (952) (905) (952) (905) Accumulated losses (1,819,681) (1,443,111) (1,819,681) (1,443,111) 3,934,301 3,077,952 3,934,301 3,077,952 Participation of non controllers - - (161) 50 Total shareholders's equity 3,934,301 3,077,952 3,934,140 3,078,002 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 11,029,957 9,812,763 11,687,373 10,241,349 6

7 Statement of Operations Period ended In thousands of reais 09/30/ /30/ 09/30/ /30/ Net revenue 4,459,384 5,148,495 5,014,661 5,576,650 Cost of goods and services sold (3,389,216) (3,894,324) (3,961,311) (4,450,505) Gross profit 1,070,168 1,254,171 1,053,350 1,126,145 Operating income (expenses) Selling expenses (675,428) (816,548) (599,733) (644,508) General and administrative expenses (282,237) (249,099) (305,741) (269,315) Other operating income (expenses) (27,446) (26,454) (21,003) (25,231) Result before financial result 85, , , ,091 Financial revenue 373, , , ,391 Financial expenses (1,057,010) (1,046,932) (1,088,372) (1,102,546) Financial result (683,348) (733,627) (694,922) (760,155) Equity accounting 20,207 (4,870) - - Loss before income tax and social contribution (578,084) (576,427) (568,049) (573,064) Income tax and social contribution Current - - (14,673) (8,523) Deferred 201, , , ,031 Loss of the period (376,570) (383,607) (376,781) (383,556) Atributed to controlling shareholers (376,570) (383,607) (376,570) (383,607) Atributed to non controlling shareholers - - (211) 51 Loss of the period (376,570) (383,607) (376,781) (383,556) 7

8 Statement of Comprehensive Result Period ended In thousands of reais 09/30/ /30/ 09/30/ /30/ Loss of the period (376,570) (383,607) (376,781) (383,556) Itens to be posteriorly reclassified to the result Accumulated conversion adjustment of foreign investments (47) (520) (47) (520) Total comprehensive result (376,617) (384,127) (376,828) (384,076) Atributed to controlling shareholers (376,617) (384,127) (376,617) (384,127) Atributed to non controlling shareholers - - (211) 51 8

9 Statement of Changes in Shareholders Equity In thousands of reais Valuation Acumulated Capital Stock Capital Reserve Adjustment losses Total Balance at January 1st, ,483,041 38,927 (905) (1,443,111) 3,077,952 Total Comprehensive result Net loss for the period (376,570) (376,570) Foreign exchange variation of offshore investments (47) (47) Contribution of shareholders and distributions to shareholders Advance for future capital increase 1,214,731 1,214,731 Capital increase 9,526 (9,526) - Stock option plan 18,235 18,235 Balance at 5,707,298 47,636 (952) (1,819,681) 3,934,301 Valuation Acumulated Capital Stock Capital Reserve Adjustment losses Total Balance at January 1st, 3,635,970 27,691 (368) (957,251) 2,706,042 Total Comprehensive result Net loss for the period (383,607) (383,607) Increase of participation in controlled companies - Foreign exchange variation of offshore investments (520) (520) Contribution of shareholders and distributions to shareholders Advance for future capital increase 841, ,409 Stock option plan 8,047 8,047 Balance at 30, 4,477,379 35,738 (888) (1,340,858) 3,171,371 9

10 Statement of Changes in Shareholders Equity Period ended In thousands of reais Capital Stock Capital Reserve Valuation Adjustment Acumulated losses Non controlling shareholders participation Total Balance at January 1st, ,483,041 38,927 (905) (1,443,111) 50 3,078,002 Total Comprehensive result Net loss for the period (376,570) (376,570) Foreign exchange variation of offshore investments (47) (47) Contribution of shareholders and distributions to shareholders Capital increase 1,214,731 1,214,731 Capital increase with issuance of plan of action 9,526 (9,526) - Resourses to capital increase non controlling shareholders (211) (211) Stock option plan 18,235 18,235 Balance at 5,707,298 47,636 (952) (1,819,681) (161) 3,934,140 Capital Valuation Acumulated shareholders Capital Stock Reserve Adjustment losses participation Total Balance at January 1st, 3,635,970 27,691 (368) (957,251) 91 2,706,133 Total Comprehensive result Net loss for the period (383,607) (383,607) Foreign exchange variation of offshore investments (520) (520) Contribution of shareholders and distributions to shareholders Advance for future capital increase 841, ,409 Stock option plan 8, ,097 Balance at 30, 4,477,379 35,738 (888) (1,340,858) 141 3,171,512 10

11 Statement of Cash Flows Period ended In thousands of reais Cash flows from operating activities 09/30/ /30/ 09/30/ /30/ Loss of the period (376,570) (383,607) (376,781) (383,556) Adjustments to net loss: Depreciation and amortization 253, , , ,859 Deferred income tax and social contribution (201,514) (192,820) (205,941) (198,031) Interest and indexation and exchange variances 424, , , ,851 Equity accounting (20,207) 4, Others (22,965) 30,062 (23,788) 26,213 Adjusted net loss 56,485 52, ,640 79,336 Decrease (increase) in operational assets: Accounts receivable 452, , , ,916 Inventories 502,030 (199,604) 490,163 (185,505) Recoverable taxes 65,218 (292,368) 63,138 (296,248) Prepaid expenses 4,899 6,571 17,449 (2,950) Judicial deposits (12,715) 1,117 (12,645) 1,295 Other accounts receivable (current and non-current) (250,781) (95,690) (252,972) (95,945) 761,449 (340,365) 758,075 (399,437) Decrease (increase) in operational liabilities: Suppliers (1,346,664) (811,038) (1,349,996) (757,796) Payroll and related charges (5,115) 3,185 1,289 9,487 Taxes and contributions (current and non current) (35,185) (493) (38,852) (5,829) Other accounts payable (current and non current) (60,578) (74,600) (127,728) (108,333) Accounts payble affiliate companies 36,067 (125,269) 126,821 (2,212) (1,411,475) (1,008,215) (1,388,466) (864,683) Interest Expense on Loans and Debentures (230,675) (194,531) (237,853) (207,103) Paid Income Tax and Social Contribution - - (2,207) (2,098) Net cash provided by (used in) operational activities (824,216) (1,490,251) (733,811) (1,393,985) Cash flow from investing activities: Marketable securities (359,290) 931,443 (612,330) 969,753 Fixed assets (2,151) (24,085) (2,995) (27,763) Intangible (242,525) (300,782) (242,907) (303,564) Investiments - (91) - - Value paid for the acquisition of subsidiaries - (200) (28,042) (56,065) Net cash used in investment activities (603,966) 606,285 (886,274) 582,361 Cash flow from financing activities: Borrowings and financing 1,978, ,560 1,978, ,560 Payments of borrowings and financing (563,137) (187,538) (371,297) (267,097) Capital increase in cash 1,210, ,409 1,210, ,409 Net cash provided by financing activities 2,626, ,431 2,818, ,872 Increase (decrease) in cash and cash equivalents 1,198,056 (123,535) 1,197,993 (125,752) Opening balance of cash and cash equivalents 223, , , ,424 Closing balance of cash and cash equivalents 1,421, ,986 1,422, ,672 Increase in cash and cash equivalents 1,198,056 (123,535) 1,197,993 (125,752) 11

12 Statement of Value Added Period ended In thousands of reais 09/30/ /30/ 09/30/ /30/ Revenues Sales of goods and services 5,465,527 6,280,224 6,183,154 6,854,089 Other revenues (10,832) 418 (10,710) 1,568 Reversal (allowance) for doubtful accounts (16,038) (28,440) (20,451) (27,933) 5,438,657 6,252,202 6,151,993 6,827,724 Goods acquired from third parties Costs of goods and services sold (4,138,311) (4,835,515) (4,868,426) (5,491,230) Materials, energy, third party services and others (450,078) (482,915) (270,749) (257,304) Lost / Recuperation of asset value - 9,044-9,078 (4,588,389) (5,309,386) (5,139,175) (5,739,456) Gross value added 850, ,816 1,012,818 1,088,268 Depreciation and amortization (253,119) (210,046) (259,451) (217,859) Net value added generated 597, , , ,409 Value added received in transfer Equity result 20,207 (4,870) - - Financial income 373, , , ,391 Total value added to distribute 991,018 1,041,205 1,146,817 1,212,800 Distribution of value added Employees Direct compensation 126, , , ,953 Benefits 57,009 52,037 68,063 63,210 Guarantee fund for years of service 16,431 21,980 23,959 26, , , , ,113 Taxes and contributions Federal (199,670) (170,809) (191,331) (154,469) State 220, , , ,559 Municipal 4,431 4,540 8,957 8,482 24,828 (11,980) 46,864 21,572 Compensation of third party capital Interest 1,057,010 1,046,932 1,088,372 1,102,546 Rentals 84,720 96,416 95, ,197 Others ,142,627 1,144,276 1,184,353 1,214,671 Remuneration of own capital Loss for the period (376,570) (383,607) (376,570) (383,607) Participation of non controlling shareholers in retained profits - - (211) 51 (376,570) (383,607) (376,781) (383,556) Distribution of value added 991,018 1,041,205 1,146,817 1,212,800 12

13 Press Release 3Q17 B2W DIGITAL ANNOUNCES CASH GENERATION OF R$ 43.9 MILLION IN 3Q17 B2W Marketplace continues rapid development and reached GMV of R$ 1.15 billion in 3Q17 (up 101.2%), reaching 35.7% share of total GMV Rio de Janeiro, November 1 st, 2017: B2W Digital (BTOW3), the largest and most beloved digital company in Latin America, today announces its results for the 3rd quarter of KEY INDICATORS 3Q17 3Q16 Delta 9M17 9M16 Delta Total GMV (R$ MM) 3,216 3, % 8,638 8, % Marketplace (R$ MM) 1, % 2,737 1, % Marketplace Participation (% of GMV) 35.7% 18.7% +17 p.p. 31.7% 16.4% +15,3 p.p. Mobile (% of Traffic) 59.8% 52.2% +7,6 p.p. 54.7% 48.5% +6,2 p.p. Net New Customers (K LTM) N.A N.A MESSAGE FROM MANAGEMENT Over the last 5 years, B2W has invested heavily in its Digital Platform, with greater focus on connecting people, businesses, products and services. This important investment cycle was part of B2W's Strategic Plan to address the country's structural and logistical challenges, creating the best customer experience and high barriers to entry. The Digital Platform built today enables the Company to operate different business fronts such as Direct Sales / 1P, Marketplace / 3P, Logistics and Distribution, and Digital Services, among others, while also allowing for future business opportunities to be developed and implemented with great speed. In the same way that our Digital Platform is appealing to the Customer, the centerpiece of the Company's strategy, it must also be able to attract strategic partners such as suppliers and sellers to the Marketplace. In less than 4 years of operation, the Marketplace has reached R$ 3.6 billion in volume transacted (last 12 months) and continues to grow rapidly ( % in 3Q17 vs. 3Q16). The growth of the Marketplace reflects B2W's unique value proposition to its sellers (qualified traffic, access to the most beloved brands on the Internet in Brazil, support in logistics, distribution and customer service, digital services across different verticals and above all, an experienced and highly skilled commercial team). In the first nine months of 2017, the Company's investments were strategically focused on the exponential growth of the Marketplace, which already represents 36% of total GMV (in 3Q17) and should reach more than 50% of GMV in The results of the actions underway already reflect significant advances in the trajectory to cash generation of the Company. In 3Q17, B2W generated R$ 44 million in cash, an increase of R$ 530 million compared to 3Q16, the best result for the period in the last 4 years. For the full year 2017, cash consumption (vs. ) should experience a significant reduction, putting the Company in the direction of free cash generation in the short-term, an important movement to B2W becoming self-sustaining. 13

14 and independent auditor s 3Q17 HIGHLIGHTS B2W Marketplace connected more than 1,800 new sellers in 3Q17. The Marketplace (3P) continues to grow rapidly from a base of 6,000 sellers in June 2017 to more than 7,800 sellers in B2W Digital expanded the Submarino Prime loyalty program. Previously the program was restricted to the major metropolitan cities of Rio de Janeiro, São Paulo and Belo Horizonte, and has now expanded to all 2,479 cities in the South and Southeast regions of the country, reaching 65% of the Brazilian GDP. B2W Digital announced the launch of Americanas Prime loyalty program. In time for Black Friday, Americanas.com customers will be given access to all of the benefits the program has to offer. B2W Digital announces expansion of loyalty programs (Prime) to the Marketplace. The Submarino Prime and Americanas Prime loyalty programs will be extended to Marketplace sellers using B2W Entrega (Delivery), expanding the assortment from 160,000 to over 1 million offers available to subscribers. B2W Marketplace announces the launch of the C2C (customer to customer) segment. The sale of used products among individuals, a segment with superior profitability and unlimited assortment, will drive significant increases in traffic to the websites and expand B2W's customer base. B2W Digital was the champion in two categories of the "Época Reclame Aqui" awards. For the fifth consecutive time, Americanas.com won in the E-commerce Big Operations category and for the second consecutive time, Direct won in the Logistics and Transport category. The awards are made based on votes made by the customers. Lojas Americanas started selling products on B2W Digital sites. Throughout 4Q17, more than 6,000 items will be available for delivery in the states of São Paulo (SP), Rio de Janeiro (RJ), Minas Gerais (MG) and Pernambuco (PE). The operation is supported by B2W Digital's logistics and technology platform: B2W Entrega (Delivery); B-Seller (Technology); and SkyHub (Integration). In 2018 the product offering will become available throughout Brazil. STRATEGIC INITIATIVES ENHANCING THE DIGITAL PLATFORM Commercial and Marketing o o o Market Share: Since the beginning of the investment plan, B2W has expanded its market share by 8.0 p.p. from 19.9% in 1H12 to 27.9% in 3Q17. Assortment: The number of items (SKUs) offered on the site totaled 4.2 million at the end of 3Q17, up 62% from 3Q16, driven primarily by Marketplace. Prime: The Company expanded the program's offerings to all 2,479 cities in the South and Southeast regions of the country, which was previously restricted to the capitals of Rio de Janeiro, São Paulo and Belo Horizonte. In November, the company will launch Americanas Prime, the Americanas.com loyalty program, enabling the brands customers to access the service in time for Black Friday. By year end, the Submarino Prime and Americanas Prime programs will be extended to Marketplace sellers, growing the range of product offerings from 160,000 to more than 1 million. Sellers using the B2W Entrega, the B2W logistics and distribution service, will be able to participate in the benefits of the programs. The Prime loyalty program offers the customer a superior shopping experience for an annual fixed amount. With Prime, the customer receives free unlimited fast delivery, as well as exclusive offers and dedicated customer service. 14

15 and independent auditor s Marketplace Evolution o Marketplace GMV: In 3Q17, Marketplace grew by 101.2% vs. 3Q16, reaching R$ 1,148.8 million in GMV with a participation of 35.7% in total GMV. o o Product Assortment: B2W Marketplace reached over 3.8 million items by the end of 3Q17, increasing 80% in comparison to the year ago period. C2C: By the end of the year, B2W will make available the sale of used products between individuals (C2C), providing unlimited assortments and significantly contributing to increases in recurring traffic to the sites and expanding the B2W customer base. Logistics and Operations o The Distribution Unit: In 3Q17, the participation of the B2W Distribution Unit reached 97% of the Company s deliveries in direct sales/ 1P. During the quarter, the Distribution Unit began to process deliveries for 14 new customers, including major sellers from the marketplace. Revenues from external clients represented 40% of total sales in the quarter. o o Freight Menu: The verticalization of the distribution unit allowed for the creation of the Freight Menu, which offers 6 delivery options throughout the country: Same Day, Next Day, Fast, Standard, Scheduled Delivery and Click & Collect. In 3Q17, the number of daily deliveries via Next Day option on the Freight Menu grew 120% in relation to the year ago period. B2W Entrega: The platform that operates and controls the Marketplace deliveries reached more than 2,500 sellers by the end of 3Q17. By year end, the platform will be integrated with the loyalty program (Prime), allowing sellers to make their items available to Prime customers. Mobile and Technology o Traffic: During 3Q17, traffic from mobile devices represented more than half of total visits, reaching 59.8% of the total, an expansion of 7.6 p.p. compared to 3Q16. o Apps: B2W s apps reached more than 2.5 million downloads in 3Q17, an increase of 98% compared to 3Q16 and totaling more than 14 million downloads since inception. Digital Services o B2WAds: The B2W Marketplace native ads platform connected 250 new sellers in 3Q17, totaling a base of more than 1,000 advertisers. o BIT Services: Complete solutions in different technology verticals to support B2W (1P) and Marketplace (3P) e-commerce operations. Sieve: Pricing Intelligence Online Stores Site Blindado: Security and Virtual Credibility Infoprice: Pricing Intelligence Offline Stores Admatic: Digital Marketing Skyhub: Marketplace Integration Financial Services o Credit Promotion: In 3Q17, B2W and Cetelem s joint venture (Submarino Finance and Digital Finance) recorded volume of R$ million in approved transactions, representing 15

16 and independent auditor s growth of 16% compared to 3Q16. Over the first 9 months of the year recorded volume reached R$ 2.3 billion in approved transactions, representing growth of 23%. In the same period, the receivables portfolio for these operations was R$ 1.2 billion, an increase of 17% from the year ago period. As of, the operations registered 2.5 million credit cards issued (1.649 million for Submarino Finance and 855 thousand for Digital Finance which includes the brands Americanas.com, Shoptime and Sou Barato). o BNDES Card: The BNDES Card is offered as a means of payment on the B2W Empresas website (corporate sales), which became the first e-commerce website to accept the Card. The BNDES card has R$ 58 billion in pre-approved credit and transacted R$ 5.6 billion in Customer Service o B2W Digital s main brands are regarded as industry benchmarks in customer service, having received the best evaluation given by the Reclame Aqui website. The average score given by customers on Reclame Aqui website for B2W s brands is 7.8 while the main competitors have an average score of % of customers who registered complaints on Reclame Aqui website indicated their intent to buy again from B2W s brands, while only 56% of customers indicated that they intended to buy again on the main competitors websites. The average solution rate of B2W s brands on Reclame Aqui website is 93%, while the average solution rate of competitors brands is 80%. These achievements are the result of the Company's commitment in optimizing the quality of service and attentiveness offered to its customers. Digital Talents o o o Hackathon: As a stimulus to the development of entrepreneurial technology projects with potential to create new businesses, we promoted the IronBIT event, where important initiatives were developed through a Hackathon (programming marathon). In total there were 83 registered participants, 22 proposals and 13 projects developed. Summer Job: The program consists of students from renowned National and International Universities who develop projects focused on innovation and process improvements. In June 2017, for the fifth time B2W hosted the International Summer Internship, a program for the recruitment of students from top American universities. In addition, the Summer Job program has been expanded to the most prestigious Brazilian universities. Brazil Field Projects: In August 2017, B2W hosted four students of different nationalities from the IESE Business School MBA program during a one-week period at its headquarters in Rio de Janeiro. Together with associates, the students developed a project to automate the decision-making process for strategic pricing of products. Corporate Sustainability o ISE: For the third consecutive year, B2W was selected to integrate the BM&FBOVESPA Corporate Sustainability Index (ISE) portfolio. o BVSA: B2W maintained its partnership with the Bovespa Socioenvironmental Stock Exchange (BVSA), supporting another project in April Between 2015 and 2017, the Company supported 11 projects based on the UN's Sustainable Development Objectives (ODS). 16

17 and independent auditor s o Transparency: B2W is among the most transparent companies in Brazil for the quality of its financial statements, being recognized as one of the winners of the "Transparency Trophy" Award at the 21st ANEFAC (National Association of Finance Executives). FINANCIAL HIGHLIGHTS The financial information serving as the basis for the comments below refer to 3Q17, and are in accordance with international financial reporting standards (IFRS), with the standards issued by the Securities and Exchange Commission of Brazil (CVM), as well as the listing rules of the Novo Mercado and in Brazilian reais (R$). Definitions for adjusted financial metrics can be found in Annex III and Annex V. GMV: In 3Q17, GMV was R$ 3,216.0 million, compared to R$ 3,060.0 million in 3Q16, representing growth of 5.1%. B2W's Marketplace continues to grow rapidly and reached GMV of R$ 1,148.8 million in 3Q17 (101.2% growth), with a 35.7% share of total GMV. Gross Revenue: In 3Q17, gross revenue was R$ 2,184.7 million, compared to R$ 2,551.2 million in 3Q16, representing a variation of -14.4%. Net Revenue: In 3Q17, net revenue was R$ 1,775.1 million, compared to R$ 2,065.2 million in 3Q16, representing a variation of -14.0%. Adjusted Gross Profit: In 3Q17, adjusted gross profit was R$ million, compared to R$ million in 3Q16, representing a variation of -13.2%. Adjusted Selling, General and Administrative (SG&A) Expenses: In 3Q17, adjusted SG&A expenses were R$ million, a reduction of $83.9 million (-23.6%) vs. the R$ million recorded in 3Q16. In 3Q17, SG&A accounted for 15.3% of net revenue, a reduction of 1.9 p.p. compared to 3Q16, when adjusted SG&A accounted for 17.2% of net revenue. Adjusted EBITDA: In 3Q17, Adjusted EBITDA reached R$ million, compared to R$ million in 3Q16, representing an increase of 13.1%. Adjusted EBITDA margin expanded from 6.8% in 3Q16 to 9.0% in 3Q17. Net Financial Result: In 3Q17, net financial result was R$ million, representing a reduction of 28.3% in relation to the R$ million in 3Q16. Net Result: In 3Q17, the net result was R$ million, representing a reduction of 39.3% in relation to the R$ million in 3Q16. Cash Management: o Working Capital: Varied 8 days (3Q17 vs. 3Q16) mainly due to the deceleration process of 1P (Direct Sales) and the strong acceleration of 3P (Marketplace). As the Company migrates 1P categories (lower profitability) to 3P (higher profitability), there is initial pressure on working capital and cash, due to the lower turnover of existing inventories and the change in the commercial relationship with the suppliers of goods. It is important to remember that Marketplace (whose credit card transactions are approved on the B2W platform and make up the gross balance of receivables) does not demand Working Capital (B2W is an intermediary and receives a commission on realized sales). 17

18 and independent auditor s o CAPEX: B2W uses its cash generation prioritizing investments that present optimal returns to shareholders. Thus, in 3Q17, consolidated investments in plant, property and equipment and intangibles (development of websites and systems) totaled R$ 84.8 million (down -12.5%% vs. R$ 96.9 million in 3Q16), representing 2.6% of total GMV (reduction of 0.6 p.p vs. the 3.2% in 3Q16). Accordingly, Adjusted EBITDA in 3Q17 covered 188% of CAPEX for the period, compared to a coverage ratio of 146% in 3Q16. Financial Debt: B2W s cash balance, excluding FIDC consolidation, at 09/30/2017 totaled R$ 3,568.4 million, 3.3x times the sum of the Company's short-term debt, which totaled R$ 1,083.7 million. The level of leverage (defined as Net Debt / Adjusted EBITDA LTM) was 3.0x on 09/30/2017, compared to 3.1x on 06/30/2017. Capital Increase: o In March 9, 2017, a Board of Directors Meeting was held in order to approve the proposal to increase the Company's capital stock, which was subsequently submitted to the Extraordinary General Meeting for approval, in the amount of R$ 1,210,000, (one billion, two hundred and ten million reais), through the private issue of 110,000,000 (one hundred and ten million) new common shares at an issue price of R$ (eleven reais) per share. o The capital increase was approved by majority at the Extraordinary General Meeting held on March 25, Accordingly, shareholders had from March 27, 2017 to April 25, 2017 to exercise their rights of preference for the subscription of the new shares issued in proportion to their participation in the Company's capital on the close of trading on March 24, o The objective of the Capital Increase is to strengthen the cash of the Company and to improve its capital structure. The capital increase will allow the Company to continue investing in its digital platform and accelerating the growth of its Marketplace. o The Capital Increase had participation of nearly 100% of the Company's shareholders. Lojas Americanas entered with R $ 752 million on March 27, 2017 (equivalent to its 62.16% stake) and minority shareholders joined in with the remaining R $ 458 million between the end of April and the beginning of May

19 and independent auditor s ANNEX I: ABOUT B2W DIGITAL B2W Digital is the leader in Latin America and its purpose is to CONNECT PEOPLE, BUSINESS, PRODUCTS AND SERVICES IN A DIGITAL PLATFORM. The Company has the largest and most beloved Internet brands (Americanas.com, Submarino, Shoptime and Sou Barato) and the fastest growing Marketplace operation. The platform built over the years allows B2W to also offer technology, logistics, distribution, customer service and consumer finance services. DIGITAL PLATFORM AND B2W VIRTUOUS CYCLE: 19

20 and independent auditor s ANNEX II: FINANCIAL STATEMENTS INCOME STATEMENT EXCLUDING THE EFFECTS OF B2W DIGITAL S TRANSPORTATION SUBSIDIARIES B2W - Companhia Digital Income Statements Period ended on 30 Period ended on 30 (in million of Brazilian reais) 3Q17 3Q16 Variation 9M17 9M16 Variation Gross Merchandise Volume (GMV) 3, , % 8, , % Gross Sales and Services Revenue 2, , % 6, , % Taxes on sales and services (409.6) (486.0) -15.7% (1,168.5) (1,277.5) -8.5% Net Sales and Services Revenue 1, , % 5, , % Cost of goods and services sold (1,344.5) (1,569.2) -14.3% (3,828.1) (4,215.1) -9.2% Gross Profit % 1, , % Gross Margin (% NR) 24.3% 24.0% 0.3 p.p. 23.7% 24.4% -0.7 p.p. Operating Revenue (Expenses) (356.4) (427.8) -16.7% (1,038.7) (1,149.2) -9.6% Selling expenses (259.5) (337.9) -23.2% (732.9) (879.8) -16.7% General and administrative expenses (11.7) (17.1) -31.9% (48.5) (54.6) -11.2% Depreciation and amortization (85.3) (72.8) 17.2% (257.3) (214.8) 19.8% Operating Result before Net Financial Result and Equity Accounting % % Net Financial Result (197.7) (275.7) -28.3% (695.0) (760.2) -8.6% Financial revenues % % Financial expenses (333.2) (390.7) -14.7% (1,088.5) (1,102.6) -1.3% Equity from minority interest Other operating income (expenses)* (8.7) (9.7) -10.3% (21.0) (25.2) -16.7% Income tax and social contribution % % Net Result (88.0) (144.9) -39.3% (376.6) (383.6) -1.8% Net Margin (% NR) -5.0% -7.0% 2.0 p.p. -7.5% -6.9% -0.6 p.p. Adjusted EBITDA % % Adjusted EBITDA Margin (% NR) 9.0% 6.8% 2.2 p.p. 8.1% 7.7% 0.4 p.p. * In the the former accounting rules, considered as "non-operating income". Effects of the consolidation of B2W Digital s transportation subsidiaries. NON-EXCLUDING THE CONSOLIDATION OF B2W DIGITAL S TRANSPORTATION SUBSIDIARIES B2W - Companhia Digital Income Statements Period ended on 30 Period ended on 30 (in million of Brazilian reais) 3Q17 3Q16 Variation 9M17 9M16 Variation Gross Merchandise Volume (GMV) 3, , % 8, , % Gross Sales and Services Revenue 2, , % 6, , % Taxes on sales and services (409.6) (486.0) -15.7% (1,168.5) (1,277.5) -8.5% Net Sales and Services Revenue 1, , % 5, , % Cost of goods and services sold (1,385.2) (1,661.7) -16.6% (3,961.3) (4,450.5) -11.0% Gross Profit % 1, , % Gross Margin (% NR) 22.0% 19.5% 2.5 p.p. 21.0% 20.2% 0.8 p.p. Operating Revenue (Expenses) (315.7) (335.3) -5.8% (905.5) (913.8) -0.9% Selling expenses (218.8) (245.4) -10.9% (599.7) (644.4) -6.9% General and administrative expenses (11.7) (17.1) -31.9% (48.5) (54.6) -11.2% Depreciation and amortization (85.3) (72.8) 17.2% (257.3) (214.8) 19.8% Operating Result before Net Financial Result and Equity Accounting % % Net Financial Result (197.7) (275.7) -28.3% (695.0) (760.2) -8.6% Financial revenues % % Financial expenses (333.2) (390.7) -14.7% (1,088.5) (1,102.6) -1.3% Equity from minority interest Other operating income (expenses)* (8.7) (9.7) -10.3% (21.0) (25.2) -16.7% Income tax and social contribution % % Net Result (88.0) (144.9) -39.3% (376.9) (383.6) -1.8% Net Margin (% NR) -5.0% -7.0% 2.0 p.p. -7.5% -6.9% -0.6 p.p. Adjusted EBITDA % % Adjusted EBITDA Margin (% NR) 9.0% 6.8% 2.2 p.p. 8.1% 7.7% 0.4 p.p. * In the the former accounting rules, considered as "non-operating income". 20

21 and independent auditor s BALANCE SHEET B2W - Companhia Digital Balance Sheet (in million of Brazilian reais) ASSETS CURRENT ASSETS 9/30/2017 6/30/2017 Cash and banks 1, ,693.5 Marketable securities 2, ,799.5 Accounts receivable Inventories 1, Recoverable taxes Prepaid expenses and other accounts Total Current Assets 6, ,656.9 NON CURRENT ASSETS Deferred income tax and social contribution Recoverable taxes 1, ,108.0 Escrow deposits and other receivables Plant, property and equipment Intangible assets 2, ,901.3 Total Non-Current Assets 5, ,499.3 TOTAL ASSETS 11, ,156.2 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Suppliers Loans and financing 1, ,116.7 Debentures Salaries and social contribution Taxes payable Deferred income tax and social contribution Other accounts payable Total Current Liabilities 2, ,162.5 NON-CURRENT LIABILITIES Loans and financing 4, ,415.3 Debentures Related parties Provision for contingencies and other accounts payable Total Non-Current Liabilities 4, ,980.8 SHAREHOLDERS' EQUITY Capital 5, ,693.0 Capital reserves Equity valuation adjustment (1.0) (0.9) Accumulated income (losses) (1,819.7) (1,731.7) Minority interest (0.2) - Total Shareholders' Equity 3, ,012.9 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 11, ,

22 and independent auditor s CASH FLOW STATEMENT B2W - Companhia Digital Cash Flow Statement (in million of reais) Operating Activities 9/30/2017 9/30/ Variation Net Result for the Period (376.8) (383.6) (6.8) Adjustment to the Net Result: Depreciation and amortization (41.6) Deferred income tax and social contribution (205.9) (198.0) 7.9 Interest, monetary and currency changes (66.8) Others (23.8) Adjusted Net Result (57.3) Change in Working Capital: Accounts receivable (273.0) Inventories (185.5) (675.7) Suppliers (1,350.0) (757.8) Change in Working Capital: (406.9) (763.4) (356.5) Change in Assets: Prepaid expenses 17.4 (3.0) (20.4) Escrow deposits (12.6) Recoverable taxes 63.1 (296.2) (359.3) Other accounts receivable (current and non-current) (253.0) (95.9) Change in Assets: (185.1) (393.8) (208.7) Change in Liabilities Salaries and social security charges Recoverable taxes (current and non-current) (38.9) (5.8) 33.1 Other liabilities (current and non-current) (127.7) (108.3) 19.4 Accounts payable/receivable (related companies) (2.2) (129.0) Change in Liabilities: (38.5) (106.8) (68.3) Interest Expense on Loans and Debentures (237.9) (207.1) 30.8 Paid Income Tax and Social Contribution (2.2) (2.1) 0.1 Cash Flow from Operating Activities (733.9) (1,393.8) (659.9) Investing Activities Marketable securities (612.3) ,582.1 Purchases of property, plant and equipment assets (3.0) (27.8) (24.8) Intangible assets (242.9) (303.6) (60.7) Value paid for the acquisition of subsidiaries (28.0) (56.1) (28.1) Cash Flow from Investing Activities (886.2) ,468.5 Financing Activities Funding 1, (1,867.0) Payments (371.3) (267.1) Capital increase in cash 1, (369.4) Advance for future capital increase Cash Flow from Financing Activities 2, (2,132.2) Change in cash balance 1,198.0 (125.7) (1,323.7) Beginning Cash Balance Ending Cash Balance 1, (1,218.5) 22

23 and independent auditor s ANNEX III: NOTE REGARDING THE FINANCIAL STATEMENTS Effects in the consolidation of B2W Digital s transportation subsidiaries Click-Rodo and Direct (subsidiaries of B2W Digital) provide merchandise distribution services to the Company, generating an elimination effect in consolidated gross revenue and selling, general and administrative expenses (distribution expenses), according to the present accounting rules. The consolidated gross profit is reduced in an amount equal to the positive effect observed in the selling, general and administrative expenses, but with no effect on Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA On October 4th, 2012, Brazilian Securities Exchange Commission (CVM) enacted Instruction 527/12, regarding the voluntary disclosure of non-accounting information such as EBITDA. The Instruction aims to standardize the disclosure, in order to improve the understanding of this information and make it comparable among publicly listed companies. In order the maintain consistency and comparability between previous periods, we present the reconciliation of EBITDA. In 3Q17, Adjusted EBITDA was R$ million. Including other operating income and expenses, EBITDA, according to CVM Instruction 527/12, would be R$ million in 3Q17, representing 8.5% of net revenue. 23

24 and independent auditor s ANNEX IV: INDEBTEDNESS Including FIDC Consolidation Excluding FIDC Consolidation Indebtedness - R$ MM 9/30/2017 6/30/2017 9/30/2017 6/30/2017 Short Term Debt 1, , , Short Term Debentures Short Term Indebtedness 1, , , Long Term Debt 4, , , ,415.3 Long Term Debentures Long Term Indebtedness 4, , , ,615.3 Total Debt (1) 6, , , ,385.9 Cash and Equivalents 3, , , ,337.7 Credit Card Accounts Receivables Net of Discounts Total Cash (2) 4, , , ,366.6 Net Debt (Cash) (2) - (1) 1, , , ,019.3 Net Debt (Cash) / Adjusted EBITDA LTM Average Maturity of Debt (days) Accounts receivable are mainly composed of credit card receivables, net of the discounted value, which have immediate liquidity and can be considered as cash. The breakdown of B2W s accounts receivable is demonstrated in the following table: Including FIDC Consolidation Excluding FIDC Consolidation Accounts Receivable Reconciliation - R$ MM 9/30/2017 6/30/2017 9/30/2017 6/30/2017 Gross Credit Cards Receivables 2, , , ,520.8 Discounted Receivables (2,129.0) (2,286.1) (2,434.9) (2,491.9) Credit Card Receivables - Net of Discounted Amount Present Value Adjustment (1.1) (0.8) (1.1) (0.8) Allowance for Doubtful Accounts (25.1) (26.7) (25.1) (26.7) Other Accounts Receivable Net Accounts Receivable

25 and independent auditor s ANNEX V: DEFINITIONS Adjusted EBITDA: Operational earnings before interest, taxes, depreciation and amortization and excluding other operational revenues/expenses and equity accounting. Adjusted Gross Profit: Gross profit excluding the effects of the consolidation of B2W Digital s transportation subsidiaries. Adjusted Selling, General, and Administrative (SG&A): SG&A excluding the effects of the consolidation of B2W Digital s transportation subsidiaries. GMV (Gross Merchandise Volume): Sales of own merchandise, sales realized on the Marketplace, and other revenues (excluding commissions from Marketplace sales), after returns and including taxes. Marketplace Participation: Marketplace sales as a percentage of total consolidated GMV. Market Share: Total sales on B2W sites, including those made on the Marketplace, divided by total market sales (source: e-bit). Net Debt (Cash): Calculated as the sum of short-term and long-term indebtedness, less the sum of cash & equivalents and credit card accounts receivables (net of the discounted balance). Net New Customers: Increase in active customer base during the trailing 12 months. Working Capital: Calculated as the sum of days of trade accounts receivable (using GMV as a basis) and inventory days, minus vendor days, considering GMV and CMV in the last 12 months. 25

26 and independent auditor s INFORMATION ABOUT THE WEBCAST AND THE CONFERENCE CALL Conference calls with simultaneous translation into English, followed by a bilingual Q&A session, will be held as followed: 26

27 and independent auditor s Explanatory Notes to the Individual and Quarterly Information In thousands of reais, except when otherwise mentioned 1 Operational context B2W - Companhia Digital ("B2W" or "Company ), with head offices at Rua Sacadura Cabral, 102, in the City and State of Rio de Janeiro, incorporated through the merger of Americanas.com S.A. - Comércio Eletrônico (Americanas.com) and Submarino S.A., with shares traded on the Brazilian Securities, Commodities and Futures Exchange (BM&FBOVESPA), under the ticker symbol BTOW3. B2W is controlled by Lojas Americanas S.A. ("LASA" or ""), an also publicly held company with shares traded on BM&FBOVESPA under the ticker symbols LAME3 - ON and LAME4 - PN. The Company and its subsidiaries are engaged in the following sectors: e-commerce, through its brands, Americanas.com, Submarino, Shoptime and Sou Barato; its consumer finance service platforms, Submarino Finance and Digital Finance; technology platform; logistics, distribution and customer service platform; and its Marketplace. B2W offers technology services through BIT Services, which is the result of the construction of a disruptive, robust and innovative technology platform to support the growth of the Company. On the logistics vertical, B2W offers services on storage, distribution and customer services to its partners through its B2W Fulfillment (BFF) platform. Finally, consumer finance services are another of B2W Digital s platforms, through which the Company offers private label credit cards for its four main brands, Americanas.com, Submarino, Shoptime and Sou Barato. The issue of these individual and consolidated quarterly information was authorized by the Board on October 27, Summary of significant accounting policies 2.1 Intermediate financial information The quarterly information, individual and consolidated, are being presented in accordance with the Brazilian Securities Exchange Comission (CVM), applicable for the preparation of the Quarterly Information ITR, with the technical pronouncement CPC 21 (R1) Intermediate Demonstration, issued by Brazilian Accounting Pronouncements Committee (CPC), and with the international rules IAS 34, issued by the International Accounting Standards Board (IASB). 2.2 Accounting practices and policies In the individual and consolidated quarterly information the accounting practices are being presented consistently with the accounting practices adopted in the individual and consolidated financial statements as of December 31,, issued on February 8, Because of that these individual and consolidated quarterly information should be read together with the information as disclosed in the financial statements for the year ended December 31,. 2.3 Presentation of segment information 27

28 and independent auditor s The Company's activities are concentrated in the marketing of products and delivery of services by various means of non-presence marketing, especially the Internet. Despite the diversity of products sold and services provided by the Company (e-commerce retail, consumer finance platform; technology platform; logistics, distribution and customer services; and Marketplace), such activities are not controlled and managed by the Management as independent operational segments, as their accompanying results are monitored, tracked and evaluated in an integrated manner. Thus, Management understands that the Company is organized, basically, as a single business unit. The Company also operates in the area of financial products through the subsidiary Submarino Finance Promotora de Crédito Ltda., which, by not achieving the minimum quantitative and qualitative parameters, is not being presented as a separate operating segment. 2.4 Explanatory notes not presented The individual and consolidated quarterly information is presented in accordance with CPC 21 (R1), IAS 34 and the regulations issued by CVM. Based on this and management's evaluation of the material impacts of the information to be disclosed, the explanatory notes described below are not being presented. The others are being presented so as to allow the complete understanding of this individual and consolidated quarterly information when read in conjunction with the accompanying notes disclosed in the financial statements of December 31,. Explanatory notes not presented: Quality of financial assets credit; Advance revenue; Insurance coverage; 2.5 Present value adjustment The operations of long-term purchases, primarily from suppliers of goods and services, were adjusted to their present value taking into account the maturities of these transactions. The average rate used of 10.93% per annum (p.a.) at (14.06% p.a. at December 31, ), was based on funding for the respective periods. The constitution of the present value adjustment of purchases is recorded under "Inventory" (Note 9) and the counterpart entries are shown under the heading "Financial Expenses", on Note 26, through the maturity date, in the case of suppliers, and for the realization of inventories based on the amounts recorded under the heading "Cost of goods sold and services provided." The operations of long-term transactions, at the same previously-agreed prices as represented, mainly, through credit card installment sales, were brought to their present value taking into account the payment deadlines of the aforementioned transactions. The average rate used of 11,86% p.a. as of (15.35% p.a. on December 31, ), was based on receivable discounts on their respective base dates. On the identified adjustments, the tax rates were applied on the respective base of dates. The present value adjustment of installment sales has a counterpart entry under the heading 28