MRM - 2018 Registration document

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Information on M.R.M.’s activities

Presentation of the Company

householder confidence and the business climate in retail trade: -12 and -15 points respectively. The first indicator shows the impact that social protests have had on the economic climate; the second is indicative of a possible slowdown in retail activity due to political and economic uncertainty that extends beyond France. Due to lower levels of growth, job creations slowed considerably over 2018: +107,000 compared with +341,000 in 2017. Of this commercial employment, the services sector still accounts for most job creations while interim roles are losing momentum. OXFORD ECONOMICS is therefore forecasting unemployment in mainland France to stand at 8.9% in 2019 (7.8% in the Greater Paris Region), representing a decline compared with the 9.4% (8.7% respectively). Although more measured than expected, unemployment fell for the third consecutive year over 2018. There was also a decrease in the number of category-A jobseekers, a first since 2016 (-52,000 between January and November). Hopefully, these protests will have only a limited impact on employment; the Ministry of Labour estimates that around 50,000 employees have been laid off as a result. The introduction of universal unemployment benefits, the terms of which are yet to be agreed, should benefit small store owners and small store owners that currently have little protection. 2018 did however make a good start to the year. Householders were returning to the shops and consumption was rising. With the exception of the clothing sector, household consumption was showing modest but tangible growth at the very beginning of the year. The disruption became noticeable from November with -2%; this was mainly due to the ‘yellow- jacket’demonstrations, before stagnating towards the end of the year (+0.1% for the full year). As a result, the Banque de France reported a -4.1% decrease in turnover for the retail trade compared with 2017 - its lowest level since 2012. The year drew to a close with a cumulative -0.9% compared with 2017. PROCOS has announced a -3.3% year-on-year decrease in performance for specialised trade; this is far lower than in previous years. 2018 was problematic in terms of turnover as positive growth was only seen in April and more particularly in October. With -11%, the month of September set the tone for both high street retail (-11.8%) and for out-of-town facilities (-10.5%). Towards the end of the year, the position

was far more tense across all formats, including retail parks (-10.1% in November) which are normally more resilient to changes in footfall. The measures secured by the ‘yellow jacket’movement to boost purchasing power should theoretically drive retail activity and offer a more optimistic outlook for the next few months. However, business leaders are still being cautious and the indicator for activity towards the end of the year plummeted (-37.5 points compared with December 2017) to the lowest point since December 2014. The business climate indicator for the retail trade also plunged by -15 points compared with the end of 2017. Optimism is all the more difficult to consider while the prospect of an end to this social conflict is very unclear over the short term. […] Mainly European tourists Tourists returned to the capital in 2017. This trend continued into 2018 with a +6% year-on-year increase by the end of Q3 2018. There were fewer French tourists, but this was offset by a 12% increase in foreign tourists, particularly those from neighbouring European countries (Germany, Spain and Italy). These were closely followed by American tourists. Q3 was the most active of the year with almost 4.3 million hotel arrivals in Paris. High street: land of opportunity For several months there has been a crossover between the various types of retail. Some shopping centre and retail park retailers are trying to reposition themselves on the best town-centre high streets and, conversely, there is still a drive to take high street players into out-of-town locations. City- centres therefore represent new areas for retailers seeking opportunities on advantageous terms (not prohibitive premiums and market rents). Despite PROCOS having recorded falling levels of turnover on high streets (-3.9% year on year in December), take-up figures were relatively satisfactory in terms of transactions, even though leaseholder expectations can sometimes be achieved by a simple departure. City centres

M.R.M. 2018 REGISTRATION DOCUMENT

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