DERICHEBOURG - Universal registration document 2019-2020

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Group management report Significant events during the fiscal year

Significant events during the fiscal year 3.1

Spain is a dynamic market for the productionof electrical steel. While steel production is at around the same level as in France (around 15 MT), the share of steel producedby the electrical industry is close to 70%, whereas it is only 40% in France. Spain has a ferrous metals deficit, and imports scrapmetal from France in particular. Covid-19 health crisisand economic 3.1.2 consequences Until mid-March 2020,the Group's activities saw very little disruption from the Coronavirushealth crisis. The lockdownmeasuresannounced on March 16, 2020 with effect from March 17, 2020 had a sudden impact on the Group's business in France, its main country of operation. Faced with this unprecedentedhealth and economic shock, the Group took the followingmeasures: Measuresto protectemployees Equipment for employees (social distancing, gel, masks, ventilation) p in accordance with the instructions of the public authorities and accordingto individualwork situations. Use of homeworkingfor office staff wherever it was possibleduring p the lockdownperiod. Economicmeasures Use of the furlough scheme for staff whose job is no longer needed p or whosehours have been reducedas a result of the Covid-19crisis. Identifying savings opportunities: sponsorship, fees and travel p ( de facto ). Postponinginvestments. p

Acquisition of the Lyrsa Group 3.1.1 (renamed Derichebourg España on September 1, 2020)

On December 20, 2019, Derichebourg Environnement completed the acquisition of the Lyrsa Group, Spain's leading independent player in scrap metal recycling. The acquisition was completed following the signing of the acquisition agreement on September 19, 2019. DerichebourgEnvironnementacquired 100% of the investments held by Layro SA in Lajo y Rodriguez SA (Lyrsa), Aragonesa de Chatarras y Metales SA (Archamesa) and Recuperaciones Díaz SA (Redisa). Lyrsa also owned 50% of Reyfra (a company that operates a scrap metal shredder in Madrid), whose joint shareholder was Derichebourg Environnement. In the calendar year 2019, the Lyrsa Group'soperationscoveredby this acquisition generated revenue of €450 million (with the full consolidationof Reyfra) and an Ebitda of €17.3 million.Lyrsa processes nearly 1 millionmetric tons of metal waste per year, including around 160,000 metric tons of non-ferrous metals. The Group has around 650 employees. Lyrsa was founded in 1939. It operates 18 recycling centers (17 in Spain and 1 in Portugal). It operates 3 shredders (including one from prior to the Lyrsa acquisition, jointly owned with the DerichebourgGroup through Reyfra), a center for the sorting of the metals derived from the crushing process, an aluminum refinery and a lead refinery. The Derichebourg Group made this acquisition using its available cash and existing credit lines. A new syndicatedloan was set up followingthis acquisition. Lyrsa's activity is consolidatedin the Group's financial statementsas of January 1,2020 (9 monthsof activityover the fiscal year). The DerichebourgGroup's strategy pursued through this acquisition is to duplicate the vertical integration strategy that it is already implementingin France. This covers general recyclingof scrapmetal, as well as the developmentof niche businesses (flotation, refining), with high added value, made possible by dense coverage. Derichebourg's objective is for Lyrsa's Ebitda (approximately 4% in 2019) to move closer towards (if not equal) over several years, the France Group's Ebitda (approximately8%). This will be achievedthrough the following actions: Sales synergies: pooling of customer contacts to ensure that the p Group benefits from the best sales opportunities at all times and cross-procurementof the the Group’sspecializedtools; Some cost synergies; p Developing Lyrsa's supplier base to improve unit margins, primarily p by targeting smaller suppliers in addition to the existing network, and consolidationof the Spanishdomesticmarket.

The impact on the Group'svariousbusinesseswas as follows:

EnvironmentalServices The followingchangesoccurredin the Recyclingbusiness:

In France, business activity fell sharply and progressively from p March 17,2020 under the combinedeffect of the temporaryclosure of several scrap metal-consuming plants and a scarcity of scrap metal supply (shutdown of the automobile industry, lower overall consumption,ban on travel by private individuals),and as of April 10 had flattened to around 15% of the usual business volume. The Group was forced to close most of its small retail sites due to the lack of footfall. All industrial sites remained open and used the furlough scheme. As anticipated,there was a gradual upward trend in footfall after the Easter weekend.The increasecontinuedand was more pronounced from May 11, 2020, when lockdown easing began. By September 2020,the Group had returned to a level of businessactivity comparableto that of last year.

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