Expectations and outlook

Economic conditions appear to remain favourable in the countries in which the Group operates. The quality of sleep is increasingly being recognised as part of a healthier and more enjoyable lifestyle. This provides an interesting growth potential for the Group.

The outlook for the Benelux is cautiously optimistic and the Group assumes that its growth will outpace the market. The plans and initiatives in place provide sufficient confidence to gradually improve market share despite market conditions.

Given the premature phase of the recovery in the German-speaking countries the Group remains confident about the initiatives but careful about the pace of recovery. The restructuring carried out by the new management in the fourth quarter of 2018 (fewer stores, reduced overhead, reduced inventories), changing product ranges, more active and aggressive marketing and a far greater focus on online are intended to ensure that Matratzen Concord achieves a first step towards a lasting recovery and further consolidates its position in the German-speaking countries.

The Group firmly believes in its mid-term strategy that was presented at the Capital Markets Day.

The implementation of the five strategic pillars customer-focused value-for-money proposition, best sleep advice, seamless omni-channel experience, strong performance culture and cost leadership is crucially important to be able to persistently deliver on the promise offer best quality rest @ affordable prices. The mid-term ambitions are sales growth of 4-5% and an EBITDA margin of 7-9%. The Group expects to take a first step towards these ambitions in 2019.

Uden, the Netherlands, 28 February 2019