SOMFY - Annual financial report 2018

04 MANAGEMENT BOARD MANAGEMENT REPORT

HOME & BUILDING ACTIVITY — INTERIOR PRODUCTS 2018

The new V300 video-phone, designed both for installers and private individuals, was released in the summer of 2018. This video-phone, a core product, benefits from plug & play design (it is easy both to install and use). It thus addresses a real need to secure access, not only for French consumers but also for those in Southern and Eastern Europe. The highly anticipated Outdoor Camera, our new CES award-winning outdoor camera, was released in October: it is the most dissuasive on the market, allowing, thanks to the integrated 110 dB siren and the triggering of the lighting system, to prevent a burglary attempt before it takes place. Furthermore, within the Connected Solutions Activity, Overkiz, the Group subsidiary which manages the TaHoma infrastructure and also works for other customers providing bespoke solutions, has joined forces with the Smart Home BG to drive forward the customisation of our connected range for customers and, in particular, to design for them environments which combine Somfy-connected products with those of other brands. This project, Sokiz, has allowed Somfy to move from a customer/supplier relationship to a position as expert in connected devices serving customers, while supporting the development of Somfy's motors and equipment sales. With this project, the Group offers a flexible range of products whose size is unique to the marketplace. It has considerable potential as it is targeted at real-estate developers, service providers, telecommunications companies, energy providers and major players in the building industry. This project has been launched at a time of strong growth in demand for connected homes, not only in France but also in Europe and beyond, particularly in Asia where the concept of condominiums (serviced apartments) entirely justifies the installation of connected equipment. In May 2018, our Connected Solutions Activity opened “So Open with Somfy”, a dedicated European platform which provides companies and developers with free access to our APIs (Application Programming Interfaces). Somfy connected products are now open to any developer who wishes to include our solutions in their applications. The provision of our APIs is being rolled out gradually: automation for rolling shutters, thermostats, etc. Launch, in June, of TaHoma DIN Rail, Somfy’s latest home automation box designed for new housing. It enjoyed an early success in Poland with Polish real-estate developer Echo: more than 4,500 apartments, including around 100 in 2019, are to be equipped with the Somfy ecosystem (connected thermostat, Izimo lighting micro-modules, etc.) connected with TaHoma DIN Rail. This new modular box which offers Zwave, RTS and io, EnOcean, Wi-Fi (and Zigbee in the course of 2019) protocoles is built into the electrical panel and can be installed very easily by electricians through a dedicated application that can be accessed without prior internet connection. This success parallels that of the first partnership in Europe in the area of collective housing with French market leader Nexity. CONNECTED RESIDENTIAL SOLUTIONS 2018

Twenty-three motors were launched in 2018 for the interior solar protections, an unprecedented volume of development in this segment. Similar numbers have been planned for 2019. In the residential segment, we have focused on reliable, quiet, connectable and autonomous solutions using embedded batteries. This broad range is designed to meet the different uses and technical standards found throughout the world. Other developments seek to build a medium-term competitive advantage. That is the case of two current pilot projects. The first, Huna, is a blind solution focusing on the simplification of user experience from purchase to maintenance. The second, Mornin’+, allows manual curtains to be motorised without having to change the installed device. In the “Projects” segment, which targets the needs of commercial buildings, launch of a range of ultra-quiet motors using the SDN (Somfy Digital Network) protocol for the United States, and launch of the Sonesse 40 io in Europe. In 2018, Somfy invested in the development of a new communication platform for the control of interior and exterior blinds in commercial buildings, preparing for the widespread use of the Internet in IPv6 format. The R&D teams have successfully met the challenge of developing a new communication protocol, operating on two different media: Ethernet and RS485 (with several patents at stake). This new platform, which has been tested on two buildings at our Cluses site, the R&D Center and the LightHouse, will be launched on the market in 2019 and will be open, scalable and remotely accessible, it will enable all Somfy digital motors (wired - SDN- and radio - io- technology) to be controlled, providing numerous benefits for occupants, owners and technical building managers. Launch of the Bioclimatic Pergola, a tiny “ecosystem” which includes control of lighting, heating, and the pergola’s roof and walls. It strengthens Somfy’s position in a rapidly changing market. In Europe today, consumers want fully automated pergolas that are user friendly. That is why, over the last six months, Somfy has launched several product lines based on a control unit and the io-homecontrol protocol. Outside of Europe, Somfy is also adapting to the American market. With its leading position in the external screen market, Somfy has a major advantage in this market. Since late 2017, Somfy has been marketing a new motor in the United States, the Maestria RTS, designed for a zipscreen (external screen sealed with a type of zip). Its strength is obstacle detection. Zip Screen is completely suitable for the walls of this type of pergola. PROJECT BUSINESS SOLUTIONS 2018 ALSO, IN 2018, FOR HOME & BUILDING

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SOMFY – ANNUAL FINANCIAL REPORT 2018