Worldline - 2019 Universal Registration Document

F

RISK ANALYSIS Risk factors

Service delivery quality and business continuity [extra-financial F.2.4 risks – Build Customer Trust/A robust and reliable IT Infrastructure]

The Group depends heavily on the efficient and uninterrupted operation of core systems, including its computer systems, software, servers and data centers. The services the Group delivers are designed to continuously, securely and reliably process very complex transactions-very often in real-time-and provide reports and other information on those transactions, all at very high volumes and processing speeds. Any failure to deliver an effective and secure service or any performance issue that result in significant processing or reporting errors or service outages could have a material adverse effect on a potentially large number of users, the Group’s business and, ultimately, its reputation. In addition, the Group’s business entails, especially for fixed-fee contracts, the risk that development costs and expenses may prove to be much higher than initially

anticipated, whether as a result of incorrect initial estimates, the emergence of new and unexpected challenges during the course of the project, or errors in the operational management of the project. In such cases, the Group may not be able to secure an upward revision to the fixed fee, either at all or sufficient to compensate for the increased cost. In such cases, the Group would record a provision, which could have a material adverse effect on its business, financial condition or results of operation. The Group has defined a set of programs and mitigating measures to address these continuity risks. Those measures are further detailed in Section D.2.3.2 “A robust and reliable IT Infrastructure” and Section D.2.3.3 “Worldline business continuity strategy”. Financial impacts resulting from the global slowdown in ● economic activity involving lower transactions volumes and non on-payment in sectors specifically affected by the health crisis or on he availability or cost of financial resources (see Section F.2.5.9 "Macro-economic changes and country risks). Mergers & Acquisition risk F.2.5.2 As part of its growth strategy, the Group actively explores acquisition opportunities and alliance relationships with other businesses that will allow the Group to increase its market penetration, technological capabilities, product offerings and distribution capabilities. The Group’s strategy of expanding through acquisitions exposes it to a number of risks associated with valuation and potential undisclosed liabilities (negotiating a fair price for the business based on inherently limited diligence) and integration of businesses (managing the complex process of integrating the acquired company’s workforce, products, technology and other assets so as to realize the projected value of the acquired company and the synergies projected to be realized in connection with the acquisition). The process of integrating operations could also cause an interruption of, or loss of momentum in, the activities of one or more of the Group’s consolidated businesses and the possible loss of key personnel. The diversion of management’s attention and any delays in the delivery of the Group’s services or difficulties encountered in connection with acquisitions and the integration of the two companies’ operations could have an adverse effect on the Group’s business, results of operations, financial condition or prospects.

Other risks F.2.5

Impact of the Coronavirus F.2.5.1 pandemic (Covid-19)

The risk relating to the Coronavirus (Covid-19) pandemic is regularly monitored by management at Group and local entity level. The recent evolution of the risk relating to the Coronavirus (Covid-19) pandemic has necessitated a reassessment of its impact at Group level. This pandemic constitutes a health, operational and inancial risk. Initially appearing only in Asia-Pacific in December 2019, this virus spread rapdily and virulently in Europe and the rest of the world, leading to significant measures, in particular restrictions and containment measures taken by the governments in various countries in a context that is highly changing and uncertain in terms of duration, thus generating significant consequences on the global economy that were not initially anticipated. The spread of this virus and its consequences, in particular the measures taken by governements or stakeholders in response, is likely to affect the health of employees and service providers, the Group's operations and projects, as well as its financial situation. Although the impacts are difficult to quantify at this stage, the main risk factors of this pandemic have been identified. Without being exhaustive, they can be summarized as follows. Health impacts on the health and activities of the Group's ● employees and service providers, which could lead to restrictions and/or disruptions in the conduct of operations or the loss of employees in critical positions (see Section F.2.4 "Service delivery quality and business continuity"); Operational impacts due to the disruption of industrial ● supply chains for products or equipment from countries affected by this pandemic (see Section F.2.5.6 "Suppliers"); and

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Universal Registration Document 2019