Worldline - Registration Document 2016

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Operation and financial review Overview

omni-commerce solutions and Worldline Sips payment acceptance solutions: Online Services. The Group generates Online Services ● revenue from two main groups of solutions: The Group’s omni-commerce solutions are generally sold ● under mid- to long-term contracts that include fees for designing and implementing the service, and recurring fees generally with an assumed minimum number of transactions, and agreed per-transaction fees above the assumed minimum. Omni-commerce revenue also include revenue from the Group’s redspottedhanky.com e-Commerce site, from which the Group earns commission revenue for the sale of train tickets and other travel-related purchases generally based on a percentage of the value of the items sold, primarily from activation fees, monthly subscription fees and per transaction processing fees that incorporate volume discounts for higher numbers of transactions. The Group also includes in this business line revenue from The Group’s Worldline Sips services revenue is generated ● other acceptance-related processing services. Revenue from its Online Services business is impacted primarily by the number of omni-commerce projects in the build phase during the relevant period, the number of omni-commerce transactions processed for projects in the run phase and the number of Sips and other acceptance transactions Private Label Cards & Loyalty Services. Revenue from the ● Group’s private label card and loyalty services are driven primarily by the number of cards or loyalty accounts managed, the level of transactions per account, and average fee per managed account and per transaction. When designing a new loyalty program the Group also typically receives “build” fees for the initial implementation of the program; Payment Terminals. The Group’s payment terminals are ● generally offered to merchants on a purchase or rental basis, with an initial installation fee and recurring monthly maintenance fees, and are often sold as a package with its Commercial Acquiring services in countries where the Group offers such services. The Group’s terminals revenue is driven primarily by the number of terminals sold or rented out and the average price or rental fee per terminal, which is in turn influenced primarily by market conditions and the mix of terminals sold. Financial Processing&Software Licensing) Global Business Line Revenue of the Financial Services (formerly The Group’s Financial Services global business line generates revenue from four business lines: Issuing Processing: ● from the processing of transactions under long term contracts under which fees are primarily based on the number of credit cards managed and the number of transactions processed. The Group’s card issuing services The Group earns most of its Issuing Processing revenue revenue is therefore primarily a function of the number of cards managed, the average level of transaction activity and the average fee per managed card and per processed;

wallets, the Group typically earns a “build” fee for the initial set up of the service, then earns fees based on the number of business transactions processed, transaction. The Group typically offers volume discounts based on pre-determined bands of transaction volumes and cards managed. When the Group acquires a new client or helps implement new services such as electronic Part of Issuing Processing revenue comes from payment ● Software Licensing fees, paid at the time the software is sold and ongoing maintenance and thereafter support fees charged annually based on a percentage of the initial license fee as well as project revenue to help banks roll out and integrate the software into their existing systems; Acquiring Processing: ● driven by the number of acquiring transactions processed by the Group in countries where it is not itself the The Group’s Acquiring Processing revenue is primarily ● The Group’s Acquiring Processing business also includes revenue from the processing of checks, a business line that is experiencing a steady revenue decline as consumers increasingly pay for transactions using cards commercial acquirer and the average fee per transaction. and other non-cash, non-check payment methods and whose profitability is adversely affected to the extent of any bad debt losses for which the Group indemnifies merchants, payment Software Licensing fees, as described above; Part of Acquiring Processing revenue comes from ● generated from transaction fees for processing eBrokerage transactions, which are typically charged on a per transaction fee basis. The Group also generates revenue through this business line from projects such as Digital Banking. The Group’s Digital Banking revenue is ● enhancements to Online Banking and mobile banking sites, which are typically charged on a build and run project basis; ACH & Payments. The Group’s ACH (Automated Clearing ● House) and Payments division’s revenue is generated from also generates revenue through this business line from projects such as adaptation of client systems to accommodate SEPA transactions, to comply with new regulations. transaction fees for processing OBeP transactions, SEPA credit transfer and direct debit transactions, which are typically charged on a per transaction fee basis. The Group Revenue of theMobility&e-Transactional Services Global Business Line line generates revenue from three business lines: The Group’s Mobility & e-Transactional Services global business project implementation fees as well as ongoing fees over the life of the contract based on the number or value of tickets managed. This division’s revenue is largely driven by the number of contracts the Group wins, the mix between management services are typically sold under mid- to long-term build to run project contracts. These include initial projects in the build phase and those in the run phase, the volume or value of transactions, and average pricing terms; E-Ticketing. The Group’s e-Ticketing and journey ●

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Worldline 2016 Registration Document