Derichebourg // 2020-2021 Universal Registration Document

1

Presentation of the Group and its activities Environmental Services business

Trading Although the majority of products sold by Ecore come from a recycling process, Ecore has also developed a trading business, which involves the purchase of materials from suppliers and the direct sale and shipment to the end customer, with no processing of materials by Ecore. Ecore’s ferrous scrap metal trading activity also serves its main export recycling activity, as it enables Ecore to fill its shipments more quickly (with a standard volume of 20,000-30,000 metric tons) and therefore to accelerate inventory rotation. A significant part of Ghent’s trading activity is delivered to Turkey. Although this represents a large part of Ecore’s volume, Ecore can easily redirect this volume to Spain, India and Saudi Arabia. In addition, as most volumes sold to Turkey come from trading activity, the impact on Ebitda is limited. Setting purchase and sales prices The vast majority of Ecore’s purchases are made through a cash purchase system. However, Ecore has entered into long-term agreements (generally three years) with factories for their manufacturing waste and large industrial groups such as SNCF and Suez for their waste. For these forward agreements, the purchase price is based on indices (Q06, BDSV) which are built to reflect sales price fluctuations. Sales of secondary raw materials from Ecore’s recycling are centralized by sales structures specialized by product and designed to efficiently distribute available volumes to end users via the Ecore network. Ecore’s sales team is in regular contact with its network of customers in order to monitor inventories, guide production according to demand, negotiate prices, help ensure on-time deliveries and manage any complaints. Ferrous metal prices The prices at which Ecore purchases ferrous metals are based on a top-down approach and are set based on the following factors: (i) the sales prices negotiated with Ecore’s customers ( e.g. steelmakers) on a monthly basis; (ii) production and logistics costs; and (iii) Ecore’s target margins. Ecore purchase prices are based on: the prices charged by steelmakers located near the region concerned (for example, Riva France for Ile-de-France and Normandy, Arcelor Luxembourg for the East and North, Riva Italy and Celsa Spain for Rhône-Alpes); local competition, as well as the prices charged by Spanish and non-European steelmakers in the case of the Brittany-Atlantic and Normandy regions; and the prices charged by non-European steelmakers in the case of trading exports from the port of Ghent. Ultimately, the purchase prices of the ferrous metals that Ecore offers to its suppliers are determined by the sales prices set for its customers, and are set by Ecore’s General Management on a weekly basis, or more often if necessary, after discussion with the national sales team and regional managers.

In addition, as of September 30, 2020, Ecore was using four barges on the Rhône, the Seine and the Mediterranean, which are mainly used to collect waste and deliver it to customers; 46 fixed and mobile shears for ferrous scrap metal and ferrous waste; 267 stationary and mobile cranes, including port cranes for shipments; 252 trucks used for transport between supplier sites, collection sites and processing sites. Sites As of September 30, 2020, Ecore’s activities covered 83 active sites in France and internationally. These properties are owned by several Ecore subsidiaries. 13 sites are operated through concessions (notably the four Ecore ports) and 14 of the sites currently used in Ecore’s operations are leased. The remainder are owned by Ecore. Ecore’s dense portfolio of sites combines industrial areas, production waste areas, high population and consumption areas and dynamic industrial areas with recycling facilities. A large geographical footprint allows Ecore to be closer to its suppliers and customers. This is an important factor which helps Ecore to collect and process large volumes of waste, while allowing it to reduce its transport costs and lead times. Ecore sites can be divided into the following three general categories: collection sites, processing sites and sites located in ports. Secondary raw materials sales 1.2.5.4 Most of Ecore’s revenue comes from the recycling of ferrous metals. As of March 31, 2021 (12 months), Ecore had sold 2.46 Mt of ferrous metals, including 581,000 metric tons through its trading business. Ferrous metals accounted for 81% of the total volume of recycled materials sold by Ecore during the period. As regards non-ferrous metals, Ecore sold a total volume of 235,000 metric tons during the 12-month period ended March 31, 2021 (including 43,000 metric tons of batteries). The recycling of other materials accounted for a volume of 353,000 metric tons over the same period. Customer portfolio for secondary raw materials Ecore has a large and diversified customer portfolio in the secondary raw materials segment. Ecore has long-standing relationships with many of its customers. Ecore’s length of partnership with its five main customers, which accounted for around 33% of net sales as of September 30, 2020, is around five to fifteen years. Ecore’s secondary raw materials sales business is not governed by formal contractual relationships, but rather operates on the basis of one-off monthly orders. Ecore’s clients in the ferrous metals sector include major steel manufacturers and foundries, such as ArcelorMittal, Riva Acier, BSW, Habas and Swiss Steel. Ecore’s non-ferrous metals customers include refineries, ferrous scrap metal processors and steel mills, namely Aurubis, Aperam, Profilglass, Befesa and Industeel.

DERICHEBOURG 2020/2021 Universal Registration Document 24