BIC_REGISTRATION_DOCUMENT_2017

COMMENTS ON THE YEAR Operations and consolidated results

FY 2017 Gross Profit margin came in at 51.9%, compared to 52.6% for 2016. FY 2017 Normalized IFO was 400.9 million euros ( i.e. , a Normalized IFO margin of 19.8%).

Key components of the change in Normalized IFO margin (in % points)

2016 vs. 2015

2017 vs. 2016

Change in cost of production  (a) •

+1.2 (0.7)

(0.3) (0.2)

Total Brand Support  (b) •

Of which, promotions and investments related to consumer and business • development support accounted for in Gross Profit Margin

(0.1) (0.6) (0.9) (0.4) (0.4) (0.3) (0.1) (0.8)

(0.7) +0.5 (0.3) (0.8)

Of which, advertising, consumer and trade support •

OPEX and other expenses •

Total change in Normalized IFO margin excluding the special employee bonus

Special employee bonus

+0.4

Of which impact on Gross Profit •

+0.3 +0.1 (0.4)

Of which impact on OPEX •

Total change in Normalized IFO margin

Gross Profit margin excluding promotions and investments related to consumer and business development support. (a) Total Brand Support: consumer and business development support + advertising, consumer and trade support. (b)

NON-RECURRING ITEMS

(in million euros)

2016

2017

Income From Operations

403.4

376.2

IFO margin

19.9%

18.6%

Restructuring costs (related primarily to BIC Graphic Europe and developing markets operations in 2017)

+6.6 (0.9)

+24.7

Retiree Medical Adjustment in the U.S.

-

Normalized IFO

409.1 20.2%

400.9 19.8%

Normalized IFO margin

Special employee bonus

+8.8

-

Normalized IFO excluding the special employee bonus Normalized IFO margin excluding the special employee bonus

417.9 20.6%

400.9 19.8%

Income before tax for 2017 was 398.1 million euros, compared to 408.2 million euros in 2016. Net income Group Share was 288.3 million euros, up 15.5% as reported. The 2017 effective tax rate for continuing operations was 25.9% compared to 30.0% in 2016. The 2017 effective tax rate includes the favorable income related to the invalidation of 3% additional French Corporate Income Tax on dividends, net of the French exceptional Corporate Income Tax contribution.

Net Income From Continuing Operations was 295.1 million euros; ● Net Income From Discontinued Operations was a negative ● 6.7 million euros and included the net loss related to the disposal of BIC Graphic North America and Asian Sourcing. FY 2017 EPS Group share was 6.20 euros, compared to 5.32 euros for the same period last year, up 16.5%. Normalized EPS Group share increased to 6.28 euros, compared to 6.24 euros.

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BIC GROUP - 2017 REGISTRATION DOCUMENT