WORLDLINE_REGISTRATION_DOCUMENT_2017

F

Risk Factors [GRI 102-15] and [GRI 102-11] Risks related to the Group’s business and industry [GRI 102-10]

The Group operates in a constantly changing environment and is exposed to risks that, if materialized, may have a material adverse effect on its business, financial condition, including operating results and cash flows, reputation or prospects. The Group can relate on a continuous process of identification and analysis of risks in order to identify those likely to affect the achievement of its objectives. The Group proceeds to the review of the main risks that may have an impact on its business, financial position or results, which are described below. Investors should carefully consider all of the information set forth in this Registration Document, including the risk factors set forth in this chapter. Such risks are, as of the date of this Registration Document, the risks that the Group believes, were they to occur, could have a material adverse effect on its business, results of operations, financial condition and prospects. Investors should note that there may be other risks that have not yet been identified as of the date of this Registration Document, or whose occurrence as of the date hereof is not considered likely to have a material adverse effect on the Group’s business, results of operations, reputation, financial condition and prospects. Risk assessment andmanagement is an integral part of the Group's operational and strategic management. Risks are assessed and monitored through business lines and functions. Internal Audit, Risk Management, Compliance, Legal, Insurance, Security and Finance departments can be cited as Functions playing a key role in identifying and controlling the main risks, among other. Risk assessment and management is based on a multi-level organization, which is detailed below. Risks are also appraised through the Internal Control initiatives and Internal Audit assignments (see Section F.7 Internal Control of this Registration Document). In addition to integrated process of risk management, dedicated activities are also deployed for transversal internal riskmanagement (see Section F.5 Riskmanagement activities of this Registration Document).

F.1

Risks related to the Group’s business

and industry [GRI 102-10]

If the Group fails to keep pace with changes in its industry or fails to continue to provide attractive and innovative services, the use of the Group’s services could decline, reducing its revenue. The global payment and digital services industry in which the Group competes is subject to rapid and significant technological change, new product and service introductions, evolving industry standards, changing customer needs and preferences and the entrance of non-traditional competitors. In order to remain competitive, the Group must anticipate and respond to these changes, which requires significant investment in, and time spent on, research and development. The Group is also optimizing its technological infrastructure, including its payment processing and other IT platforms to best position it to profit from market growth and new services. If the Group fails to keep pace with these changes or fails to continue to develop and introduce attractive and innovative services, the use of its services could decline. Any delay in offering new services, failure to differentiate the Group’s services or to accurately predict and address market demand could render the Group’s services less desirable to its clients or even obsolete, which, in turn, could have a material adverse effect on the Group’s business, financial condition and results of operations. Moreover, the projects that the Group undertakes to enhance its technological infrastructure in response to evolving market trends require significant investment, and no assurance can be given that the trends, products or services such enhancements are designed to address will develop as expected or whether such efforts will be successful. If the Group invests significantly in research and development efforts targeting new services and solutions for which a market does not develop as anticipated or at all, it could have difficulty recovering the costs it has incurred in developing

these new services and solutions and, to the extent that such investments have been capitalized, incur significant write-offs. Moreover, a number of the services the Group expects to be a source of future growth are new and address markets that are not yet fully developed. No assurance can be given that these markets will develop as expected, that the Group’s new products or services will secure wide client or consumer acceptance or be consistent with developing industry-wide standards, that the Group will succeed in gaining significant market share in these new markets, or that the Group will fully recover the investments it has made to develop such products and services. For example, although mobile commerce applications are an important element of the Group’s strategy, no assurance can be given that making purchases using mobile phones and other mobile devices will develop as quickly or as successfully as research and consulting firms expect. Similarly, many of the markets for Connected Living products such as connected vehicles are still in their early stages, and these markets may not develop as quickly or to as great an extent as expected, due, in particular, to the fact that the business models that the Group’s clients have developed to market such connected solutions to their own customers are in their early stages. Additionally, while the Group expects innovative solutions developed to address the ongoing digital transformation of retailers and other businesses to comprise an important and increasing component of the Group’s services portfolio going forward, the Group cannot be certain that businesses will continue to pursue their “digital reinvention” or adopt new technologies as swiftly or in the same manner as they have in recent years or that the Group will be able to launch new and successful products to address their needs in a timely manner.

266

Worldline 2017 Registration Document