WORLDLINE_REGISTRATION_DOCUMENT_2017

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

Failure to renew agreements with customers on acceptable terms could harm the Group’s business, particularly in segments of its business where customer concentration is high. Failure to renew client contracts could negatively impact the Group’s business. The Group’s client contracts typically vary in length from three to five years, while certain of its contracts with public sector clients in Latin America have terms of up to 10 years. At the end of a contract’s term, the Group’s clients have a choice to either renegotiate their contract with the Group, increase or decrease its scope, seek out the Group’s competitors to provide the same or similar services or cease outsourcing the relevant activity. Customers may seek price reductions from the Group when seeking to renew or extend contracts, or when the clients’ business experiences significant volume changes. Further, certain clients may seek to lower prices previously agreed with the Group due to pricing competition or other economic needs or pressures being experienced by the customer. If the Group is unsuccessful in retaining high renewal rates and contract terms that are favorable to it, the Group’s business, results of operations and financial condition may be adversely affected. Although the Group’s overall revenue is spread among a relatively large number of customers and no single customer represented more than 5% of the Group’s total revenue in 2017, within certain of the Group’s global business lines, business divisions and key geographic areas in which the Group operates, a significant percentage of revenue is nevertheless attributable to a limited number of customers. For example, in Financial Services (formerly “Financial Processing & Software Licensing”), the Group’s five largest customers, accounted for 38% of total revenue for that global business line in 2017, while in Mobility & e-Transactional Services, the Group’s five largest customers accounted for 25% of total revenue for that global business line in 2017 In France, the five largest customers accounted for 32% of total revenue in 2017. Given these concentrations, the loss of a customer could have a significant impact on the Group’s business, particularly if the Group loses key customers for its smaller or newer business lines. If the Group loses key customers in its newer business lines, it could have a material adverse effect on the Group’s ability to successfully develop these new businesses. Revenue with the Group’s parent company Atos and its customers amounted to less than 3% of its total revenue in 2017. If the Group’s sales to Atos and its customers were to decline, this could have an impact on the revenue growth of the company. If the Group loses any of its large customers within its global business lines and divisions or key geographic regions, if any of them significantly reduces or delays purchases from the Group, if the Group is required to sell products to them at reduced prices or if contracts are renegotiated on terms that are less favorable to it, the Group’s revenue, profitability, cash flows and net income on both a global business line/division and Group level could be materially and adversely affected, and the Group’s ability to consolidate and expand its market position, sell its services (including cross-offerings) and implement its global strategy could be hindered.

to incur other liabilities. Moreover, it is possible that incidents of fraud could increase in the future. Although the Group has put in place policies to manage merchant-related credit risk by establishing reserve accounts, requesting collateral and setting caps for monthly processing, it may experience significant losses from chargebacks in the future. Any increase in chargebacks not paid by the Group’s merchants could have a material adverse effect on the Group’s business, financial condition, results of operations and prospects. Defaults by the Group’s merchants on their reimbursement obligations could have a material adverse effect on the Group’s business, results of operations and financial condition. No assurances can be given that insurance coverage to protect against certain such losses will be effective and adequate. A decline in the use of credit or debit cards as a payment mechanism for consumers or adverse developments with respect to the payment processing industry in general could have a materially adverse effect on the Group’s business, financial condition and results of operations. If consumers do not continue to use credit or debit as a payment mechanism for their transactions or if there is a change in the mix of payments between cash, credit and debit cards and other payment forms which is adverse to the Group, it could have a material adverse effect on the Group’s business, financial condition and results of operations. A substantial part of the Group’s business is linked to credit and debit card payments. A smaller, but growing, portion of the Group’s business is linked to cashless payments by means other than cards using other digital and data processing areas. To the extent that the overall card-based payment market decreases and such decrease outstrips or occurs faster than the increase in the market for payments effected through digital and data processing services, the Group’s revenue could be significantly affected. Also, if margins are lower in these new areas, then the Group’s profitability could decrease, at least temporarily until they reach higher maturity levels and the initial development expenses are absorbed. Moreover, if there is an adverse development in the payments industry in general, such as new legislation or regulation that makes it more difficult for the Group’s clients to do business, the Group’s business, financial condition, results of operations and prospects may be adversely affected.

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Worldline 2017 Registration Document