LavazzaGroup2021 Bilanci2021 ENG

ANNUAL REPORT
2021
LAVAZZA GROUP - ANNUAL REPORT 2021 COMPANY OFFICERS - GROUP STRUCTURE
Company Officers Group Structure

COMPANY OFFICERS
LUIGI LAVAZZA S.p.A. GROUP STRUCTURE
BOARD OF DIRECTORS 100% 97.40 % 100% 99% 35%
LETTER TO SHAREHOLDERS
LAVAZZA NIMS LAVAZZA COFINCAF Y&L COFFEE
Alberto Lavazza Chairman PROFESSIONAL S.p.A. NETHERLANDS B.V. S.p.A. Ltd DIRECTORS’ SINGLE REPORT
HOLDING EUROPE ON OPERATIONS
S.r.l.
Giuseppe Lavazza Vice Chairmen
Marco Lavazza 100% 93% 99.99% 100%
100%
LAVAZZA
PROFESSIONAL
LAVAZZA PREMIUM
COFFEES CORP
FRESH & HONEST
CAFÉ Ltd
LAVAZZA
CAPITAL S.r.l.
YI BAI
COFFEE LAVAZZA GROUP
Antonio Baravalle Chief Executive Officer Co. Ltd
FRANCE S.a.s.
Consolidated Financial Statements
Antonella
Francesca
Lavazza
Lavazza
Directors
100% 100% 100% 100% at 31 December 2021
LAVAZZA LAVAZZA CARTE NOIRE LAVAZZA TRADING
Manuela Lavazza PROFESSIONAL DEUTSCHLAND S.a.s. SHENZHEN Co. Ltd
Pietro Boroli GERMANY G.m.b.H. G.m.b.H.
Enrico Cavatorta ACCOUNTING STATEMENTS
Leonardo Ferragamo 100% 100% 100% > Consolidated Statement of Financial Position
100%
Gabriele Galateri di Genola LAVAZZA LAVAZZA KAFFEE CARTE NOIRE LAVAZZA
Robert Kunze-Concewitz PROFESSIONAL G.m.b.H. OPERATIONS SPAGNA S.L. > Consolidated Statement of Profit or Loss
Antonio Marcegaglia (UK) Ltd. S.a.s. > Consolidated Statement of Comprehensive Income
Nunzio Pulvirenti
> Consolidated Statement of Cash Flows
Roberto Spada 100% 100% 100% 100%
LAVAZZA LAVAZZA COFFEE MERRILD LAVAZZA > Consolidated Statement of Changes in Equity
PROFESSIONAL (UK) Ltd. KAFFE ApS MAROC S.a.r.l.
(UK) OPERATING
BOARD OF STATUTORY AUDITORS SERVICES Ltd.

NOTES TO THE CONSOLIDATED
100% 100% 100% 97.54%
LAVAZZA LAVAZZA SWEDEN MERRILD LAVAZZA FINANCIAL STATEMENTS
Gianluca Ferrero Chairman PROFESSIONAL AB BALTICS SIA ARGENTINA SA
Angelo Gilardi Statutory Auditors HOLDING INDEPENDENT AUDITORS’ REPORT
Bernardo Bertoldi NORTH AMERICA Inc.
100% 80% 100% 99.53%
LAVAZZA KICKING HORSE LAVAZZA LAVAZZA
INDEPENDENT AUDITORS
PROFESSIONAL COFFEE Co. Ltd. JAPAN GK DO BRASIL Ltda
NORTH AMERICA LUIGI LAVAZZA S.p.A.
LLC
EY S.p.A. 100%
Financial Statements
LAVAZZA
AUSTRALIA Pty Ltd at 31 December 2021
ACCOUNTING STATEMENTS
100% > Balance Sheet
LAVAZZA AUSTRALIA
OCS Pty Ltd > Statement of Profit or Loss
> Statement of Cash Flows
100%
LAVAZZA FRANCE
S.a.s. NOTES TO THE FINANCIAL STATEMENTS
STATUTORY AUDITORS’ REPORT
50.01% INDEPENDENT AUDITORS’ REPORT

LA MANUFACTURE DE CAFÉ
ALAIN DUCASSE S.a.s.
SUSTAINABLE SINGLE PAGE
6 7 PRINT PDF
LAVAZZA GROUP - ANNUAL REPORT 2021
Letter to Shareholders
COMPANY OFFICERS
GROUP STRUCTURE
Dear Shareholders,
The financial year ended 31 December 2021 closed with
a Group’s consolidated result of €105,528 thousand DIRECTORS’ SINGLE REPORT
based on the IFRS and Luigi Lavazza S.p.A.’s positive re- ON OPERATIONS
sult of €103,604 thousand based on Italian GAAP (OIC).
With reference to Article 2428 of the Italian Civil Code LAVAZZA GROUP
and Article 40 of Legislative Decree No. 127(2-bis) of 9
April 1991, the Report on Operations includes both in- Consolidated Financial Statements
formation on the Financial Statements of the Parent
Company Luigi Lavazza S.p.A., and the Report on
at 31 December 2021
Operations of the Consolidated Financial Statements of
the Lavazza Group.
Despite an economic and social scenario still marked by > Consolidated Statement of Financial Position
complexities due to the Covid-19 health emergency, the
Group achieved a turnover of €2.308 billion and a positive > Consolidated Statement of Profit or Loss
performance in all markets, both the more mature ones > Consolidated Statement of Comprehensive Income
such as Italy and France, and the expanding ones such as
the United States and Germany, testifying to the soundness
of all our brands across all geographical areas. > Consolidated Statement of Changes in Equity
In the year just ended, the Group saw a positive channel and product mix, thanks both to a significant recovery in
turnover in the Away From Home channel after the slowdown effect due to Covid-19, and to the turnover of the NOTES TO THE CONSOLIDATED
At Home channel, which grew further, particularly in the Beans segment, where the Group once again recorded a
FINANCIAL STATEMENTS
leading market share in 15 countries.
INDEPENDENT AUDITORS’ REPORT
In addition to the excellent economic and financial results, the Group’s international presence was strengthened,
particularly through the joint venture with Yum China for the development of cafés in the country. Investments in
research and development projects and the constant commitment to carrying out its business activities in a sus-
tainable way from both an economic and an environmental and social standpoint were also confirmed, through the
enhancement of people and the local areas and communities in which the Group operates, as well as the reduction LUIGI LAVAZZA S.p.A.
of the environmental impact of its operations.
The 2021 results are not only a historic milestone for our Group but also the starting point from which to face a
year that promises to be extremely complex and challenging, due to the increase in the purchase price of all the
at 31 December 2021
commodities we deal with — green coffee primarily, but also packaging, energy, logistic costs — and risks related to ACCOUNTING STATEMENTS
the dramatic geopolitical context. Since the onset of the emergency in Ukraine, we have been committed to helping
those affected by the war, allocating both donations to various NGOs with which we have a longstanding collabora- > Balance Sheet
tion, and sending products to organisations providing refuge, in the hope that the situation will return to normal as > Statement of Profit or Loss
soon as possible.
The Chairman of the Board of Directors

NOTES TO THE FINANCIAL STATEMENTS
Alberto Lavazza STATUTORY AUDITORS’ REPORT

8 9 PRINT PDF
LAVAZZA GROUP - ANNUAL REPORT 2021 DIRECTORS’ SINGLE REPORT ON OPERATIONS
COMPANY OFFICERS
GROUP STRUCTURE
DIRECTORS’ SINGLE REPORT
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021
> Consolidated Statement of Financial Position
> Consolidated Statement of Profit or Loss
> Consolidated Statement of Comprehensive Income
> Consolidated Statement of Changes in Equity

LUIGI LAVAZZA S.p.A.

Directors’ Single at 31 December 2021
Report on > Balance Sheet
> Statement of Profit or Loss
Operations


10 11 PRINT PDF
Group highlights Businesses and brands

COMPANY OFFICERS
Group’s result for the year Businesses GROUP STRUCTURE

The following table shows the Group’s operating and financial highlights at 31 December 2021 compared with the
previous year: The Lavazza Group’s wide offering, dedicated to both At Home and Away From Home consumption, is distributed DIRECTORS’ SINGLE REPORT
across all sales channels: Retail, Food Service, Office Coffee Service (OCS) and Vending. This strong presence makes ON OPERATIONS
€ million 2021 RATIO % 2020 RATIO % available to all consumers and customers the most suitable solutions on every occasion, in every moment of the day.
LAVAZZA GROUP
Retail Retailing
NET REVENUES 2,308.4 100.0% 2,085.3 100.0%
EBIT 163.6 7.1% 107.7 5.2%
EBITDA 312.1 13.5% 252.8 12.1%
ADJUSTED EBITDA (before non-recurring items) 312.1 13.5% 266.4 12.8%
Within the At Home consumption channel, the Lavazza
Group has a very strong position in a number of key
The Group has Lavazza-branded proprietary and fran-
chised stores, through which it establishes a direct re-
at 31 December 2021
PROFIT FOR THE YEAR 105.5 4.6% 72.9 3.5% markets such as Italy (under the Lavazza brand), lationship with the consumer.
CAPEX 134.7 111.1 France (under the Carte Noire brand), Denmark and the Lavazza Flagship Stores’ offer is structured around an
NET FINANCIAL POSITION (283.1) (101.7) Baltics (under the Merrild brand) and Canada (under immersive, comprehensive coffee experience, where the ACCOUNTING STATEMENTS
EQUITY ATTRIBUTABLE TO THE GROUP 2,534.0 2,347.0 the Kicking Horse brand). product is enhanced in all its forms, from the most tra- > Consolidated Statement of Financial Position
HEADCOUNT AT 31/12 4,169 4,172 The range, differentiated by country, includes whole ditional, such as espresso, to the most surprising Coffee
bean and ground coffee products — for espresso, moka Design preparations. The first Lavazza Flagship Store > Consolidated Statement of Profit or Loss
coffee pot and filter systems — pods, instant coffee, was inaugurated in Milan in 2017, while September 2021 > Consolidated Statement of Comprehensive Income
ready-to-drink beverages and capsules for the world's saw the opening of the new store in the heart of London,
Between innovation and sustainability

most common home systems, suited to meeting every in a historic building in front of the iconic Liberty depart-
consumer’s taste requirements. ment store in Great Marlborough Street. > Consolidated Statement of Changes in Equity
The Group also markets its At Home products through China is another key market where coffee consump-
Nims, which offers its customers direct door-to-door tion has great potential yet to be expressed: in 2021 the
140
sale of coffee products and prompt, timely warranty Lavazza Group and Yum China, the largest restaurant NOTES TO THE CONSOLIDATED
The Lavazza Group was created by the entrepreneurial passion of a historic Italian and support service, thanks to a network of person- company in China in terms of total sales in 2020, creat-
family, the Lavazza family, and is today one of the main leaders on the global coffee al coffee shoppers who create a direct relationship of ed a joint venture to explore and develop the concept of
scene, active in all business segments. It operates in 140 markets, with 9 production trust with their customers. the Italian coffee shop in China, opening in 2021 about INDEPENDENT AUDITORS’ REPORT
plants in 6 countries and over 4,200 employees and collaborators worldwide. This Finally, Group brand products can also be purchased 20 points of sale to complement the first coffee shop
global presence stems from a growth path that has lasted for over 126 years, as well markets online, through an advanced e-commerce platform in- opened in Shanghai in 2020. The joint venture aims to
as from investments in research and innovation, with a constant focus on sustaina- cluding the direct shops of proprietary sites, a presence open 1,000 Lavazza coffee shops in China by 2025, as
bility. Over 30 billion cups of Lavazza coffee drunk every year bear witness today to a on large general-interest platforms (marketplaces) well as to distribute and market Lavazza's retail prod-
great success story. The Group's goal is to create sustainable value for shareholders, and the major retailers’ online channels. ucts, thus becoming the Group's exclusive distributor in LUIGI LAVAZZA S.p.A.
9
employees, consumers, suppliers and the communities in which it operates, combin- mainland China.
ing competitiveness with social and environmental responsibility. This means always Food Service Financial Statements
ensuring top product quality and maintaining independence and an ethical profile, to Office Coffee Service (OCS) and Vending at 31 December 2021
occupy a prominent position on the global coffee market. Lavazza provides sector professionals dedicated, tai-
Historically, Lavazza has made innovation the hallmark of its entrepreneurial activ- lor-made products and solutions for all service modes Drawing on more than 30 years of experience with cap- ACCOUNTING STATEMENTS
ity and the key to continuing to offer the best possible coffee in any form. From the and types of coffee preparation. Quality in every cup sule-based systems and vending machines, in recent
intuition that marked the Company’s first success — the coffee blend — to the devel- production is ensured making available a vast selection of pro- years the Lavazza Group has strengthened its pres- > Balance Sheet
opment of innovative solutions for packaging; from the first espresso drunk in Space plants fessional machines, specific service materials and all ence in the B2B market by acquiring the French ESP > Statement of Profit or Loss
to the dozens of industrial patents developed, Lavazza has always revolutionised the communication materials, which allow to leverage all (Espresso Service Proximité), the Australian BLUE Pod
coffee culture, with courage, energy and reliability, modernising tradition to anticipate aspects of the coffee ritual. and the Lavazza Professional business, which operates
the needs of the market and consumers. The Lavazza Training Center provides day-to-day sup- on numerous key markets for the Group: the USA, the
4,200
This forward-looking attitude is also reflected in the attention paid to the issue of port to clients in their activities through training pro- United Kingdom, France, Germany and Japan. This is a
sustainability – economic, social and environmental – always considered a reference grammes focusing on theory and operational consult- business that requires great technological and service NOTES TO THE FINANCIAL STATEMENTS
point for directing company strategy and multiplying the positive effects on the Group ing, directly on site, provided by a team of specialists skills, in order to provide its consumers with an excel-
and on the wider communities in which it operates. who operate according to the international standards of lent cup of coffee anywhere.
This approach covers all the Group's brands and creates a common culture based on excellence set by the SCA (Specialty Coffee Association). INDEPENDENT AUDITORS’ REPORT
responsible innovation, passion, integrity and competence, which serves as a guide for In addition to coffee, the range is rounded out by com-
continuing to offer superior quality coffee. employees and plementary products such as hot chocolate, ginseng
12 collaborators and barley beverages, tea, infusions and granitas.

13
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Brands
The Lavazza Group brings together the global Lavazza brand with the brands Carte Noire, Kicking Horse and Merrild, COMPANY OFFICERS
each a market-leader in its country, all united by a focus on quality, yet quite distinct in terms of characteristics and
GROUP STRUCTURE
personality.
Lavazza Kicking Horse Coffee ON OPERATIONS
Lavazza — the Group’s global brand — is synonymous Kicking Horse Coffee was founded in 1996 in Invermere
with authentic Italian coffee around the world. (British Columbia), in the Canadian Rocky Mountains, LAVAZZA GROUP
Lavazza is a consolidated, historic leader in Italy’s retail where founders Elana Rosenfeld and Leo Johnson
chains, where it is present in all business segments — dreamed of creating an innovative coffee roasting Consolidated Financial Statements
At Home, Away From Home and OCS — with dedicated
products and solutions. It can also count on excellent
company and took an artisanal approach, experiment-
ing with the art of roasting and blending coffee grown
at 31 December 2021
brand awareness and reputation in all the most strate- according to strictly natural methods. Over time the
gically important markets, also thanks to its constant brand focused increasingly on organic fair trade coffee,
commitment to sustainability. and today all its products are certified 100% organic ACCOUNTING STATEMENTS
A communication innovator, over the years the Lavazza and fair trade. > Consolidated Statement of Financial Position
brand has also built its global identity through partner- Kicking Horse is currently the leader in the North
ships in the areas of top gastronomy, sport and culture. American organic coffee sector and has been recog- > Consolidated Statement of Profit or Loss
The brand evokes sustainability, taste and wellbeing, nised in Canada as the most trusted brand according > Consolidated Statement of Comprehensive Income
and offers experiences that go well beyond the pleas- to the Gustavson Brand Trust index 2019. It joined the
ure of an excellent espresso. Lavazza Group in 2017.
Carte Noire Merrild

Carte Noire, an icon of the French art of coffee, is the Merrild was founded in Denmark as a result of the pas-
leading retail coffee brand in France, well known since sion of Møller Merrild, an entrepreneur who in 1964
its foundation for its extremely high-quality coffee. opened a small coffee roasting company in Fredericia, INDEPENDENT AUDITORS’ REPORT
Thanks to the vision of its founder, René Monnier, since a small municipality on the shore of the North Sea,
1978 Carte Noire has stood out for its refined blends and driven by a desire to improve the coffee blends availa-
for being the first player in the French market to offer ble on the market. His research resulted in the devel-
100% Arabica products. In a country famous for appre- opment of high-quality recipes with unmistakable fla-
ciating the quality of wine and cuisine, René Monnier vour — some of which remain unchanged to these days LUIGI LAVAZZA S.p.A.
succeeded in doing the same with coffee, thanks to an — propelling the brand’s growth into a leader of the
innovative communication inspired by cinema. Today, coffee market in Denmark and the Baltics. This promi- Financial Statements
Carte Noire is the number-one brand by penetration,
reputation and image in the French coffee market. It is
nent role is also reflected in the brand’s intense social
sustainability activity. In line with the Lavazza Group's
at 31 December 2021
a perfect brand for the Lavazza Group, of which it has focus on quality, Merrild joined it in 2015. ACCOUNTING STATEMENTS
been part since 2016.
> Balance Sheet


14 15 PRINT PDF
General performance and market scenario

COMPANY OFFICERS
GROUP STRUCTURE
In 2021, the global economy recorded a solid recov-
ery after the contraction in GDP that occurred in 2020 LETTER TO SHAREHOLDERS
— the first since 2009 — due to the measures put in
place by governments to cope with the outbreak of the DIRECTORS’ SINGLE REPORT
Covid-19 pandemic. The recovery was driven by the ON OPERATIONS
gradual lifting of the circulation containment measures
starting from the first half of the year, as well as by the
successful vaccination campaigns in the West, where LAVAZZA GROUP
the main countries rapidly immunised a large part of
the population. In the rest of the world, this process was Consolidated Financial Statements
slower, limiting the resumption of production capacity,
particularly in manufacturing hubs and ports in the Far
at 31 December 2021
East, and causing bottlenecks in many supply chains.
The ensuing supply restrictions and the formidable and
sudden recovery in demand for goods and services by ACCOUNTING STATEMENTS
western households, further strengthened by the mon- > Consolidated Statement of Financial Position
etary and, above all, fiscal stimulus measures imple-
mented in 2020 to cope with the pandemic crisis, led to > Consolidated Statement of Profit or Loss
the onset of strong inflationary pressures. The latter, > Consolidated Statement of Comprehensive Income
initially confined to a few sectors (semiconductors, mo-
tor vehicles and commodities related to the production
of clean energy), gradually extended to other product > Consolidated Statement of Changes in Equity
categories (gas and oil primarily), causing cascading increases in consumer and production prices.
In light of these developments, the major central banks began to discuss the reduction of the extraordinary mon- NOTES TO THE CONSOLIDATED
etary stimulus plans adopted in 2020. Since inflationary pressures appeared particularly pronounced in the US —
where inflation reached record levels for almost 40 years — the Federal Reserve was at a more advanced stage of
this process: it has already begun its plan to gradually reduce bond purchases, at the end of which a discussion on INDEPENDENT AUDITORS’ REPORT
the rise in the cost of money, still at the 0%-0.25% range since March 2020, is likely to follow.
While acknowledging the intensity of the ongoing inflationary pressures, the ECB continued to consider them
mainly transitory, but nonetheless announced its intention to conclude the PEPP (Pandemic Emergency Purchase
Program), characterised by flexibility in the distribution of purchases among Member States, at the end of March
2022. The reference rate was however still firmly anchored at 0% (the ECB deposit rate was -0.5%) and a change in LUIGI LAVAZZA S.p.A.
the short term seemed unlikely.
On the political front, there were above all two important events in Europe in 2021: the elections in Germany and
the appointment of former ECB President Mario Draghi as Italy's Prime Minister. In Germany, a fragmented political
at 31 December 2021
picture emerged from the elections that took place in September; after several weeks of negotiations, the Social ACCOUNTING STATEMENTS
Democrats, Liberals and Greens reached an agreement for a government led by SPD leader and former Finance
Minister Olaf Scholz, and, for the first time since 2005, without the CDU. > Balance Sheet
In Italy, after the loss of parliament’s confidence in Conte's second government between the end of January and the > Statement of Profit or Loss
beginning of February, the President of the Republic asked Mario Draghi to form a new national-unity government
backed by almost the entire parliamentary spectrum with the aim of supporting the recovery from the pandemic
crisis and access to and correct use of the resources provided under the Next Generation EU fund.
In China, in the second half of the year, solvency problems emerged in the local real-estate sector, which suffered a
slowdown and was burdened by excess leverage, culminating in Evergrande defaulting on its debt: the most indebt- NOTES TO THE FINANCIAL STATEMENTS
ed builder in the world reported liabilities of $310 billion as of 30 June. At the same time, despite the change in the
White House, tensions remained high between Beijing and Washington, especially in terms of technological rivalry
and regarding the future of Taiwan. INDEPENDENT AUDITORS’ REPORT

16 17 PRINT PDF
Industry overview
COMPANY OFFICERS
GROUP STRUCTURE
Group positioning Away From Home business LETTER TO SHAREHOLDERS
FOOD SERVICE (HO.RE.CA.) DIRECTORS’ SINGLE REPORT

At Home business ON OPERATIONS
The consumption trend in the Food Service channel globally compared to 2019. To date, air travel stands
In the context of the Covid-19 pandemic emergency, The Group brands expanded in all the geographical was strongly impacted by the effects of the second/third at around 42% compared to the pre-pandemic period
in the first months of 2021 as well the domestic food areas with more moderate growth in the consolidated wave of Covid-19 — from January to April — which se- (source: The Economist). However, the sector benefited LAVAZZA GROUP
consumer goods segment continued to grow at the ones (Italy, France and Denmark), whilst all the oth- verely compromised the performance of the business from the summer period, seeing a partial recovery in
extraordinary pace experienced in 2020, to then slow er regions showed higher and very sustained growth in the first half of 2021. The second half, driven by the the losses suffered in the first half of the year thanks to Consolidated Financial Statements
down in the second half of the year. The channel’s fu-
ture average growth is expected to reach +4.1% in the
driven partly by the increase in at-home consumption
triggered by the effect of Covid-19 on the market, and
performance of the summer season, showed significant
recovery, approaching pre-pandemic levels. This posi-
the easing of restrictions, the increase in vaccinations in
Europe and the re-opening of the EU to fully vaccinat-
at 31 December 2021
period 2021-2026, rising at different rates according to partly by the growth in the share of the Lavazza brand tive trend — which marked a clear recovery compared ed travellers from third countries: international tourist
the geographical area (Food & Beverage Sector Report, owing to increases in terms of distribution and mix with to 2020, which had been severely impacted throughout arrivals increased by 58% between July and September
November 2021, Edge by Ascential Retail Insight). considerable peaks in North America, Germany and almost the entire year — was however unable to return 2021 compared to the same period in 2020 (UNWTO). ACCOUNTING STATEMENTS
The more or less generalised lockdown scenarios con- Eastern Europe. to 2019 performance levels by the end of the year. > Consolidated Statement of Financial Position
tinued in winter 2020-2021 and further triggered a shift Moreover, in 2020, the restrictions on movement im- The coffee consumption trend in the Food Service
in consumption from the Away From Home channels to posed in the various countries to cope with the pandem- In the first half of the year, governments (mainly in channel was in line with the general consumption > Consolidated Statement of Profit or Loss
the retail channel, albeit declining compared to 2020, ic favoured online purchases, both in the pure-online Europe) implemented localised and progressively trends throughout the Away From Home channel. The > Consolidated Statement of Comprehensive Income
with consumers experiencing a change in their habits channels and in the home-delivery and click&collect stricter lockdowns depending on the severity of the sit- performance of the business units showed a clear cor-
mainly as a result of the increase in remote working, in services provided by traditional retailers. Growth re- uation with a considerable impact on Ho.Re.Ca perfor- relation with the pandemic evolution: overall there was
particular among white collars. mained constant throughout 2021 thanks to the online mance, albeit at a lesser extent than in 2020. Summer a strong contraction in volumes from January to April > Consolidated Statement of Changes in Equity
Growth was therefore more mitigated than the 2020 share, which partly offset the slowdown recorded in marked a decisive turning point for the entire Away (-40% compared to 2019), with a gradual reduction
levels due to the first re-openings, particularly from physical stores following the first re-openings. From Home world: in addition to the physiological re- of the gap from May onwards, up to -20% in the final
the summer onwards, but was also supported by a gen- sumption of the summer season, the mass vaccination months of the year. NOTES TO THE CONSOLIDATED
eral change in home-work habits. Estimates of the penetration rate of online purchases in campaign proved crucial for a more steady recovery. Italy and France, Lavazza's two main markets, were
Despite the volume stagnation between 2020 and 2021 the FMCG also confirmed the growth trends in all the This latter factor made it possible to stabilise the re- among the most impacted geographies and, despite a
(about -0.5% by volume), the coffee retail market grew by main geographies for the next few years. covery in both Europe and the USA (whereas Australia good recovery in performance in the summer months, INDEPENDENT AUDITORS’ REPORT
6% compared to 2019 in the Group’s 15 major geograph- experienced different dynamics), albeit with the chan- were unable to close the gap built up in the first few
ical areas of reference (2019 reported instead a slight In this context, Lavazza’s e-commerce channel contin- nel segments recording different rates of recovery: months of the year. Equally compromised were the UK
downturn). The Lavazza brand outperformed the mar- ued to report growth in line with the aforesaid acceler- and Australian markets (the latter of which suffered
ket trend in all the Roast&Ground segments, particularly ation in the main geographical areas, even exceeding > Cafés and restaurants: after the major crisis recorded the longest lockdown period in history).
thanks to the whole-bean segment that rose by 15 points the benchmarks in countries such as the US and the in the first part of the year due to localised lockdowns Other markets, on the other hand, performed against LUIGI LAVAZZA S.p.A.
compared to the growth trend in the reference segment. UK. These results were obtained by consolidating the and stringent capacity limitations, this sector benefit- the trend, exceeding the 2020 results and reaching
From a competitive point of view, the coffee category initiatives aimed at strengthening control on the chan- ed from a good recovery in the summer, leading café pre-Covid-19 levels. These included Eastern Europe, Financial Statements
experienced strong pressure with the entry and/or glo-
balisation of players that drove a growth phenomenon
nel and by intensifying promotional activities, particu-
larly in the online platforms of traditional retailers, as
and restaurant consumption to bounce back signifi-
cantly compared to 2020, although still below 2019
the Balkans and the Middle East which, thanks to the
fewer restrictions imposed and an increasingly more
at 31 December 2021
in the premium segments, especially in single-serve well as on the proprietary channels. In addition, a pro- levels. An example is Italy, which recorded a turnover widespread distribution activity, managed to overcome ACCOUNTING STATEMENTS
products, with sustained growth of high-end products. cess for evolving the business models adopted to date in the sector of +83% compared to 2020, but remained the negative impact of the pandemic and partially offset
At the same time, the dynamics in the multi-serve seg- was launched, in order to strengthen the channel’s re- nonetheless 34% lower than in 2019 (source: Il Sole the negative performance of the other business units. > Balance Sheet
ments of the more mature geographical areas were sponsiveness in seizing new business opportunities. 24 Ore). This trend is confirmed to date despite the re- In this context, the Lavazza Food Service channel fo- > Statement of Profit or Loss
instead impacted by strong promotion and competi- newed capacity limitations and the mandatory Green cused mainly on developing medium/long-term stra-
tive pressure aimed at preserving market shares. The Pass for consumption in most European and non-Eu- tegic initiatives aimed at increasing the efficiency of
Lavazza brand benefited from its premium positioning ropean countries; investments, maximising the channel’s profitability in
and offering in numerous expanding markets, especial- the most consolidated geographical areas and increas-
ly in the segments most covered by the brand’s prod- > Hospitality & Travel: the travel industry struggled to ing penetration in lower-distribution or high-potential NOTES TO THE FINANCIAL STATEMENTS
ucts, and defended its own competitive position in the recover and continued to record the heaviest reper- business areas.
main geographical areas, also working on its portfolio's cussions, with a level of bookings in sharp contraction
value levers. INDEPENDENT AUDITORS’ REPORT

18 19 PRINT PDF
OCS/VENDING
Consumption in the OCS/Vending channel is close- A breakdown of the Group’s performance based on
Significant events in the year
ly linked to hours worked, namely people’s presence market penetration shows different situations. In ma- COMPANY OFFICERS
in the workplace such as production sites, offices and ture geographical areas (Italy and France), the trend
GROUP STRUCTURE
businesses and home-work commuting. Although to was in line with the market, with a partial recovery in In 2021, the Lavazza Group consolidated its interna-
a lower extent than in 2020, this parameter continued consumption that led to an improved result compared tional presence and focus on the new generations so as LETTER TO SHAREHOLDERS
to be negatively affected by the restrictive measures to 2020. In detail, Italy's performance recovery was also to enhance the brand and support future growth.
aimed at combating the Covid-19 pandemic in 2021 driven by business lines of a mainly domestic/small of- DIRECTORS’ SINGLE REPORT
as well. More specifically, if in 2020 the channel had fice character and exposure to a less impacted con- In China, the Group reinforced its international pres- ON OPERATIONS
1,000
been globally impacted by restrictions, 2021 recorded sumption segment (production plants and healthcare ence through a 35% joint venture with Yum China, a
positive signs in all consumption segments (production facilities). local company leader in the retailing channel that Joint Venture with Yum China
plants, offices and travel and tourism sector, etc.), but Looking at the expanding geographical areas, the pen- holds the exclusive rights in China for the distribu- LAVAZZA GROUP
with a dynamic that varied across the different seg- etration increase was accompanied by less marked re- tion of products of international brands such as KFC
ments. In fact, the improvement in health conditions strictions, allowing the markets in question to achieve a and Pizza Hut. The joint venture has currently opened Consolidated Financial Statements
allowed to ease government measures with a positive
effect on the channel’s consumption. In this regard, it
2021 performance level in line with the levels reached
before the pandemic (Northern Europe), or even better
more than 20 stores in Shanghai, Hangzhou, Beijing,
and Guangzhou, and plans to open 1,000 stores by
at 31 December 2021
should be emphasised that the lifting of restrictions results than in 2019 (Romania and Bulgaria). 2025. China is a fast-growing market that, according
coffee shops to be opended by 2025
was gradual and never total, with the three consump- Lavazza Professional companies in Europe, operating to Mordor Intelligence's market research, will grow at
tion segments impacted differently: mainly with the Klix system in the UK, Germany and a rate of more than 10% and the Lavazza Group aims ACCOUNTING STATEMENTS
France, also recorded a recovery compared to 2020, to reach Chinese consumers by exploiting its 126 years > Consolidated Statement of Financial Position
> for blue collar workers at manufacturing sites, there linked to a reduction in restrictions and the leading of experience, extensive coffee expertise and a global
was a substantial return to normality thanks to the position in the production sites segment. Despite the brand. > Consolidated Statement of Profit or Loss
1895
absence of selective closures and a substantial re- growth reported in 2021, performance has yet to reach > Consolidated Statement of Comprehensive Income
turn to full productivity; the 2019 levels. In addition, the Group, after launching the brand
Opening of Le Café Alain Ducasse with > Consolidated Statement of Cash Flows
The performance of Lavazza Professional North “1895 Coffee Designers by Lavazza”, confirmed its inter-
> for white collar workers, the business continued to America was still strongly impacted due to its greater est in specialty coffee by announcing a collaboration > Consolidated Statement of Changes in Equity
suffer from the change in working and commuting exposure to white-collar environments and the pan- with the multi-Michelin-starred Chef Alain Ducasse to
habits, with a significant adoption of remote working. demic’s major impact also in the summer and early publicise and promote this new trend. The creation of
autumn periods compared to the European situation. this alliance is built around common values, namely NOTES TO THE CONSOLIDATED
If it is true that remote working decreased compared know-how, quality and tradition, but the story starts
to lockdown periods in 2020, it should still be taken from afar. It was 2018 when the two entrepreneurs, by LAVAZZA, in Paris
into account that work habits underwent a profound Giuseppe Lavazza and Alain Ducasse, came together INDEPENDENT AUDITORS’ REPORT
change, with a consequent structural reduction in the with one desire: to develop, together, a new specialty
hours worked in the office compared to the pre-pan- coffee brand. Initially aimed at a target of Away From
demic period. Home consumption and business professionals, the
new range will be gradually implemented within the
Unlike in 2020, when the first wave of the pandemic Ducasse Paris network before being accessible to the LUIGI LAVAZZA S.p.A.
had had a greater impact on the first few months of the general public.
year and the decrease in volumes had peaked between Financial Statements
ZERO
45% and 65% in the main markets compared to 2019, The year 2021 saw the launch of the new capsules Nespresso® Compatible Capsules at 31 December 2021
in 2021 the consumption trend remained substantially compatible with Nespresso®1 Original machines. The
stable, although marked by seasonality-related varia- range was completely revisited compared to the previ- ACCOUNTING STATEMENTS
tions. Despite an improvement in volume performance ous offer and now includes all the most iconic Lavazza
(about 15% more than in 2020), the OCS/Vending brands (Qualità Oro, Qualità Rossa, Crema e Gusto, > Balance Sheet
channel has not yet returned to pre-pandemic levels. ¡Tierra!, Dek) in addition to the Espresso brand in the > Statement of Profit or Loss
However, the comparison should be read taking into new Maestro variant. These are aluminium capsules
account the factors mentioned above: the persistence with zero CO2 impact as emissions generated through-
of restrictions and a change in working habits that led out the product’s life cycle are offset through the sup- CO2 impact
to the common use of remote working are reflected in port to the Madre de Dios project in the Amazon Forest
a structural reduction of consumption in the market. in Peru, managed by the climate partner EcoAct. The NOTES TO THE FINANCIAL STATEMENTS
marketing of the new capsule range started in Italy in
July 2021 and gradually expanded to numerous other
markets, including France, Spain, Sweden and Greece. INDEPENDENT AUDITORS’ REPORT
1 Lavazza is not affiliated with, endorsed or sponsored by Nespresso. SUSTAINABLE SINGLE PAGE
20 21 PRINT PDF
In 2022, worldwide distribution will be completed in the Visitors attending Expo Dubai, the first major post-Covid
other countries in which the Group operates. world event, were able to live an immersive experience
in a transparent and sustainable supply chain: the
The launch in all major countries will be supported by Lavazza café was a space to experience all the coffee COMPANY OFFICERS
a robust integrated communication campaign. production phases, from seed to cup. ¡Tierra! is a coffee
GROUP STRUCTURE
whose essence is revealed not only in its aroma, but
During the year, an extremely significant technologi- also in the care of the bean’s land of origin and respect LETTER TO SHAREHOLDERS
New A Modo Mio
VOICY
cal innovation was introduced in the world of A Modo for the people who cultivate it.
Mio machines, represented by the new Lavazza Voicy, DIRECTORS’ SINGLE REPORT
the first coffee machine in the world to be integrated To celebrate the first decade of the marriage between ON OPERATIONS
with Alexa. It is the result of an important collabora- Lavazza and tennis, which began in 2011 at Wimbledon
tion with Amazon and will allow consumers to enjoy a and gradually passed through all the Grand Slam tour-
coffee experience with countless possibilities via voice naments, the year saw the Lavazza Group take the field LAVAZZA GROUP
commands and through the app. In fact, Lavazza Voicy with Alexa built-in as Platinum Partner of the Nitto ATP Finals.
Platinum partner of Nitto
ATP
allows to ask Amazon's voice assistant to prepare one's Great tennis arrived in Turin with the Nitto ATP Finals,
favourite espresso, add the task to a routine, monitor
capsule consumption and ask for instructions on how
an international tournament that had never been
held in Italy since 1970 and that this year Turin hosted
at 31 December 2021
to use the machine, as well as interact with Amazon's and celebrated also with the support of Lavazza as
FINALS
voice assistant directly through the coffee machine just Platinum Partner. By choosing to support national
like with an Echo device. Lavazza A Modo Mio Voicy was and local organisers and institutions in building a new ACCOUNTING STATEMENTS
launched in Italy in March 2021 and in the UK in July important opportunity for international visibility and > Consolidated Statement of Financial Position
2021 with the support of an integrated communication development of Turin, the Lavazza Group renewed its
campaign. The global roll out will continue in 2022 commitment to the city where it was born and has > Consolidated Statement of Profit or Loss
with the launch in Australia. grown and from which it has been able to look confi- > Consolidated Statement of Comprehensive Income
dently to the future.
As part of a business model in which sustainability is
a fundamental component, cutting across every step > Consolidated Statement of Changes in Equity
Relauch of the
¡TIERRA!
of the production chain, from the raw material to the
finished product, the Group has relaunched ¡Tierra!, its
ethical brand, which brings to life the philosophy of the NOTES TO THE CONSOLIDATED
Lavazza Foundation with a range of 100% organic prod-
ucts. Lavazza ¡Tierra! is a range of high-quality coffee
blends: the perfect combination of excellence in taste, INDEPENDENT AUDITORS’ REPORT
wellbeing and sustainability. Through ¡Tierra!, Lavazza range
expresses its commitment to sustainable coffee culti-
vation that respects the planet and people. The launch
took place on a global scale, supported by a robust in-
tegrated communication campaign. LUIGI LAVAZZA S.p.A.
¡Tierra! played also a starring role at Expo Dubai 2020 Financial Statements
in the Solar Coffee Garden café designed by CRA - Carlo
Ratti Associati and Italo Rota Building office inside Lavazza partner at 31 December 2021
of the Italian Pavilion at
EXPO
the Italian Pavilion, of which Lavazza was Platinum ACCOUNTING STATEMENTS
Sponsor.
Inspired by circular economy principles, the project > Balance Sheet
featured a solar-powered human-size moka coffee pot, > Statement of Profit or Loss
which used a series of solar mirrors to heat the wa-
ter that was then transported through several copper
pipes to the café, reducing the energy consumption of Dubai 2020
the coffee-making phases. The design paid homage to
the iconic Carmencita moka coffee pot, designed by NOTES TO THE FINANCIAL STATEMENTS
Italian designer Marco Zanuso for Lavazza in 1979.
Again with a view to the circular economy, the counter
was made with waste coffee and beans resting on an INDEPENDENT AUDITORS’ REPORT
eco-resin surface for a tactile experience.

22 23 PRINT PDF
Real estate
COMPANY OFFICERS
GROUP STRUCTURE
Despite the persistence of the pandemic emergency, the possibility of accessing vaccines allowed the Group to carry LETTER TO SHAREHOLDERS
out some projects that had been temporarily suspended in the previous year.
In all the Group's offices, a layout of the working spaces was maintained and consolidated in compliance with social ON OPERATIONS
distancing needs, ensuring the highest priority for the health and safety of workers with continuous sanitisation,
reduction in the number of staff present, widespread use of home working, restricted use of meeting rooms, communal
areas and collective catering spaces. LAVAZZA GROUP
It was precisely to serve the interests of the community and in synergy with the Local Health Authority that the Consolidated Financial Statements
Lavazza Group decided to suspend the rental of the La Centrale convention area used for recreational exhibition
purposes in order to transform it into a vaccination hub from May to the end of September, with 16 administration
at 31 December 2021
stations, where over 150,000 citizens received the vaccine.
During the year, the property in Corso Novara 59 in Turin was sold, as it was considered no longer suitable for Group
needs, and at the end of the year a preliminary contract of sale was signed for the property located in Via Tollegno ACCOUNTING STATEMENTS
22 in Turin. > Consolidated Statement of Financial Position
2021 saw the complete renovation of the headquarters of the subsidiary Nims S.p.A. in Padua through a project > Consolidated Statement of Profit or Loss
covering more than 2,500 square metres that completely transformed the work environments. The new layouts > Consolidated Statement of Comprehensive Income
were designed to apply the Group guidelines to the work areas of the building, centred on collaboration and synergy
between the functions.
With regard to the foreign subsidiaries, the expansion of the Lavazza Deutschland headquarters in Frankfurt was
completed (a further 600 square metres), the new Training Center in Toronto was constructed and the Miami Training
Center entered its final stage of completion. NOTES TO THE CONSOLIDATED
Industrial investments LUIGI LAVAZZA S.p.A.

at 31 December 2021
Industrial investments in Italian plants increased sharply compared to the previous year. The growth was mainly ACCOUNTING STATEMENTS
linked to investments in the new lines for the production of aluminium capsules and the upgrade of the production
capacity of the lines dedicated to beans products. > Balance Sheet

In the Turin plant, work started on setting up a new line dedicated to aluminium capsule production and two im-
portant projects were launched for the Roast & Ground segment that involved rationalising the current roasting
machine inventory and expanding the production of packaged coffee beans.
In the Gattinara (Vercelli) plant, a project was launched during 2021 to increase the productivity of the A Modo Mio NOTES TO THE FINANCIAL STATEMENTS
capsule production lines.
For both plants, investment continued in order to adapt the packaging lines for the use of recyclable materials, en- INDEPENDENT AUDITORS’ REPORT
sure respect for the environment and increase workplace safety.

24 25 PRINT PDF
Financial Performance of Consolidated operating, capital and

the Lavazza Group financial situation of the Lavazza Group COMPANY OFFICERS
GROUP STRUCTURE
In 2021, within an economic and social scenario still marked by several complexities due to the Covid-19 health Reclassified statement of profit or loss ON OPERATIONS
emergency, the Group’s turnover exceeded €2.3 billion for the first time, with increasing results across all channels
and geographical areas.
€ million YEAR 2021 RATIO % YEAR 2020 RATIO % CHANGE % CHANGE LAVAZZA GROUP
Revenues grew by 10.7% compared to 2020, net financial position was positive at €283 million and operating cash
Net revenues 2,308.4 100.0% 2,085.3 100.0% 223.1 10.7%
generation amounted to €203 million, up from 2020, confirming the Group’s solidity. Cost of sales (1,385.8) -60.0% (1,264.9) -60.7% (120.9) 9.6%
The cash flow result in 2021 was positively influenced by the change in debt, which however will be largely reduced
GROSS PROFIT 922.6 40.0% 820.4 39.3% 102.2 12.5% at 31 December 2021
Promotional and advertising costs (229.9) -10.0% (185.3) -8.9% (44.6) 24.1%
in 2022. Selling costs (183.3) -7.9% (178.0) -8.5% (5.3) 3.0%
General and administrative expenses (292.6) -12.7% (275.9) -13.2% (16.7) 6.1%
Research and development costs (15.8) -0.7% (15.0) -0.7% (0.8) 5.3% ACCOUNTING STATEMENTS
Other operating income (expense) (31.7) -1.4% (44.1) -2.1% 12.4 -28.1%
Non-recurring income (expense) - 0.0% (13.5) -0.6% 13.5 -100.0%
Income (losses) for investments in JVs and
(5.7) -0.2% (0.9) 0.0% (4.8) 533,3% > Consolidated Statement of Profit or Loss
associates
EBIT 163.6 7.1% 107.7 5.2% 55.9 51.9% > Consolidated Statement of Comprehensive Income
Of which amortisation and depreciation (148.5) -6.4% (145.1) -7.0% (3.4) 2.3%
Of which EBITDA 312.1 13.5% 252.8 12.1% 59.3 23.5%
Financial income (expense) 0.2 0.0% (18.7) -0.9% 18.9 -101.1% > Consolidated Statement of Changes in Equity
Dividends 0.2 0.0% 0.1 0.0% 0.1 100.0%
PROFIT BEFORE TAXES 164.0 7.1% 89.1 4.3% 74.9 84.1%
Income taxes for the year (58.5) -2.5% (16.2) -0.8% (42.3) 261.1% NOTES TO THE CONSOLIDATED
PROFIT FROM CONTINUING OPERATIONS 105.5 4.6% 72.9 3.5% 32.6 44.7%
PROFIT/(LOSS) FOR THE YEAR 105.5 4.6% 72.9 3.5% 32.6 44.7%
PROFIT/(LOSS) ATTRIBUTABLE TO NON-
0.4 0.0% 0.5 0.0% (0.1) -20.0% INDEPENDENT AUDITORS’ REPORT
CONTROLLING INTERESTS
PROFIT/(LOSS) ATTRIBUTABLE TO THE
105.1 4.6% 72.4 3.5% 32.7 45.2%
GROUP

at 31 December 2021
> Balance Sheet


26 27 PRINT PDF
Revenues for the first time above
+10.7%
At 31 December 2021, Lavazza recorded revenues of The Group’s EBITDA was €312 million compared to €253 million in 2020 (+23.5%),
€2.3 billion, up compared to €2.1 billion in 2020 (+10.7%). €2.3 billion with an EBITDA margin of 13.5% compared to 12.1% in 2020, returning to pre-pan-
The year ended with one of the best results ever for the demic 2019 levels.
Group. It should be recalled that the 2020 EBITDA had included €12.5 million costs relating COMPANY OFFICERS
to donations made within the context of the Covid-19 health emergency.
GROUP STRUCTURE
The main revenue growth drivers were first and fore-
most associated with the recovery of the Away From compared to 2020 EBIT was €164 million, compared to €108 million for 2020 (+51.9%), with EBIT margin LETTER TO SHAREHOLDERS
Home channel (80% of the amount recorded in 2019), at 7.1%. Similarly to EBITDA, EBIT margin also returned to pre-pandemic levels (in
after the slowdown caused by Covid, and with the on- 2019 it was 7.1%). DIRECTORS’ SINGLE REPORT
going revenue increase in the At Home channel (+6.3% ON OPERATIONS
+6.3%
compared to 2020 and +23.8% compared to 2019), al- Net profit amounted to €105 million, up compared to €73 million for 2020 (+44.7%).
though the market returned to nearly pre-Covid levels At Home channel
(+0.7% in 2021 compared to 2020, whereas in the previ- LAVAZZA GROUP
ous year it recorded a +8.5%).
The product mix was positive thanks to the growth of Consolidated Financial Statements
the Beans segment, which proved to be the most dy-
at 31 December 2021
namic on the market. Taking into consideration the 15 compared to 2020
Sales performance
main geographical areas where the Group operates, the
Beans segment rose by +8.5% compared to 2020 and
Lavazza grew by 16.9%, increasing its share by 1.2%. In ACCOUNTING STATEMENTS
the Single Serve segment, which is increasingly com- > Consolidated Statement of Financial Position
petitive, the Group continued to carry out its plan for The Group’s sell-in revenues grew by 10.7%, with a positive performance in all the
€312 million
the launch of aluminium capsules. > EBITDA at channels (Retail +6.3%; Food Service +33.9%; OCS/Vending +14.3%). With special > Consolidated Statement of Profit or Loss
At geographical level as well, the Group reported ex- reference to the Retail channel (+6.3%), there were positive signs both in the main > Consolidated Statement of Comprehensive Income
cellent sell-out growth rates in the retail channel in segments and geographical areas, except with regards to instant coffee (-3.1%), con-
Germany (+14.3%), the United States (+4.5%) and firming the positive sell-out data recorded.
Poland (+16%), whereas Italy and France recorded a The Away From Home channels, and Food Service in particular, recorded a solid re- > Consolidated Statement of Changes in Equity
reduction of 5.3% and 1.4%, respectively, due to the EBITDA margin at 13.5% covery compared to 2020. This result was achieved despite the general context im-
replacement of plastic capsules with those made of pacted by the pandemic, which was more or less severe throughout the year, leading
aluminium. to alternating closures and openings in the various months of 2021, with an inevitable NOTES TO THE CONSOLIDATED
impact on the related consumption.
Within the Roadmap to Zero, launched in 2020, the In particular, within Lavazza Professional, the European companies closed 2021 with
€164 million
commitment to attaining the Scope 3 target resulted
> EBIT at
an 8% increase in turnover compared to 2020. The subsidiary Lavazza Professional INDEPENDENT AUDITORS’ REPORT
in the achievement of carbon neutrality for 100% of the North America recorded a very positive performance (+41.8%) compared to the pre-
NCC, AMM, Flavia, BLUE and Firma product range in vious year, marked by a resumption, albeit slow and irregular, of office working with a
2021, following the assessment using the LCA meth- consequent increase in office consumption.
odology and in accordance with the ISO 14067 inter-
national standard. In addition, the projects from which EBIT margin at 7.1% With reference to Italy, in the At Home channel the market share by volume was LUIGI LAVAZZA S.p.A.
the purchase of carbon credits derives were certified 39.2% (-0.6 percentage points compared to 2020) and the share by value stood at
by internationally recognised standards, such as VCS/ 33.9% (-1.3 percentage points compared to 2020). In the Roast & Ground segment, Financial Statements
CCB.
Lavazza's commitment to the value chain continued
Lavazza's share by volume rose slightly to 44.7% (+0.2% compared to 2020).
In the Away From Home channel, there was a remarkable revenue growth (+18.1%),
at 31 December 2021
+44.7%
with the Sustainable Packaging Roadmap, with the aim with a significant recovery of the Food Service channel, thanks to the consumer traffic ACCOUNTING STATEMENTS
of making the entire packaging portfolio reusable, re- Net profit at €105 million in cafés and restaurants. Also the OCS/Vending channel grew at a double-digit rate
cyclable and compostable by 2025. This path is guided (+13.7%), albeit more moderately than Food Service. > Balance Sheet
by Lavazza's sustainable-by-design approach, aimed at > Statement of Profit or Loss
ensuring the most responsible and efficient use of ma-
terials according to eco-design principles. In 2021, 70%
of the packaging produced in the Group's three main compared to 2020
plants, where 91% of total production is concentrated,
was made recyclable. NOTES TO THE FINANCIAL STATEMENTS

28 29 PRINT PDF
Capital and financial situation

COMPANY OFFICERS
GROUP STRUCTURE
Reclassified statement of financial position LETTER TO SHAREHOLDERS
€ million 31.12.2021 31.12.2020 CHANGES Net working capital amounted to €264 million, down €23 million compared to €287 million at 31 December 2020. ON OPERATIONS
This change was attributable to the following factors:
Inventories 446 405 41
Trade receivables 260 243 17 > an increase in the value of inventories (€41 million), chiefly due to the rise of the price of green coffee; LAVAZZA GROUP
Trade payables (413) (329) (84)
Other assets (liabilities) (29) (31) 2 > an increase in trade receivables of €17 million, which was consistent with the sales expansion recorded during the Consolidated Financial Statements
Total net working capital 264 287 (23) year, but partially offset by better credit management;
at 31 December 2021
Property, plant and equipment 601 586 15
> a significant increase in trade payables of €84 million, reflection the general increase in activities and costs in the
Intangible assets 1,406 1,364 42
last part of the year, with the consequent rise in the related payables.
Right of use 168 170 (2) ACCOUNTING STATEMENTS
Non-current financial assets 60 27 33 Net fixed assets totalled €1,981 million, compared to €1,953 million at 31 December 2020. > Consolidated Statement of Financial Position
Deferred tax assets/liabilities (8) 19 (27) The positive change in Property, plant, equipment and intangible assets includes the effect arising from the
year-end exchange rate adjustment for items denominated in foreign currency (chiefly US and Canadian Dollars) > Consolidated Statement of Profit or Loss
Provisions (160) (122) (38)
Provision for employee severance indemnities (86) (90) 4
amounting to approximately €59 million, as well as the effect arising from depreciation and amortisation for the > Consolidated Statement of Comprehensive Income
year, which exceeded net investments.
Total net fixed assets 1,981 1,953 28 > Consolidated Statement of Cash Flows
Assets held for sale 6 8 (2)
Right of use refers to the application of IFRS 16 as of 1 January 2019, which led to the recognition in the statement > Consolidated Statement of Changes in Equity
TOTAL INVESTED CAPITAL 2,251 2,249 2 of financial position of a financial liability represented by the present value of future lease payments, offset by the
recognition among assets of a right of use of the leased asset.
Equity 2,534 2,350 184
Financial receivables and other non-current assets (32) (44) 12 Provisions increased mainly due to higher provisions associated with plans for employee incentives and benefits, as
Current financial assets (378) (393) 15 well as for other future risks and charges related to reorganisations of industrial activities and other provisions for
Cash and cash equivalents (707) (372) (335)
other risks associated with several issues arising from ordinary operations. For further details, reference should be INDEPENDENT AUDITORS’ REPORT
made to the Notes to the Consolidated Financial Statements, namely to sections concerning changes in provisions.
Payables to banks and other non-current liabilities 615 473 142
Payables to banks and other current liabilities 218 234 (16)
Total net financial position (283) (102) (181)
TOTAL FINANCING SOURCES 2,251 2,249 2 LUIGI LAVAZZA S.p.A.

at 31 December 2021
> Balance Sheet


30 31 PRINT PDF
Reclassified statement of cash flows (*) Net investments in operating activities amounted to > dividend payout for a total of €33 million;
€135 million overall and can be broken down as follows:
> other changes mainly related to financial com-
€ million YEAR 2021 YEAR 2020 > investments in property, plant and equipment (€115 ponents (movement of OCI reserves related to the COMPANY OFFICERS
million), mainly involving plant, industrial machin- valuation of derivatives, effects deriving from the
GROUP STRUCTURE
PROFIT FOR THE YEAR 106 73 ery and coffee machines on free loan for use; changes in rights of use for third-party assets).
Income taxes 58 16 LETTER TO SHAREHOLDERS
> investments in intangible assets (€26 million), pri- More specifically, the item in the statement of cash flows
Financial expense/(income) 5 13
marily due to development costs incurred in order “Other scope and non-monetary changes” rose signifi- DIRECTORS’ SINGLE REPORT
Value adjustments to financial assets and liabilities (1) 2
to adapt and upgrade the Group's IT and reporting cantly compared to the previous year mainly as a result ON OPERATIONS
(Gains) losses from disposal of assets (1) -
systems; of the movement of the cash flow hedge reserve. This
Additions to provisions, employee benefits and other non-monetary components 91 64 was due to the revaluation of the foreign exchange de-
Amortisation, depreciation and write-downs 151 152 > disposals of property, plant and equipment recog- rivatives portfolio (resulting from the significant reval- LAVAZZA GROUP
nised as a reduction of investments amounting to €6 uation of the US Dollar against the Euro) and the effect
RESULT ADJUSTED FOR NON-MONETARY COMPONENTS 409 320
million. of the strategies to hedge the green coffee price risk
Change in trade receivables (13) 60
Change in inventories (36) (39)
Lastly, the change in net financial position was attrib-
that were implemented in financial terms during 2021
(with a positive result dictated by the growing trend in
at 31 December 2021
Change in trade payables 80 (37) utable to the following non-operating items: market prices) and the economic effects of which, as a
Change in other receivables/payables (1) 4 result of the application of hedge accounting, are de-
CASH FLOW AFTER CHANGES IN NET WORKING CAPITAL 439 308 > a negative effect arising from the capital increase ferred in the 2022 financial year (in conjunction with ACCOUNTING STATEMENTS
Taxes paid (54) (22) in the equity investment in Y&L Coffee Ltd for about the accounting recognition of the supplies hedged). > Consolidated Statement of Financial Position
Use of provisions and indemnities paid (40) (43)
€30 million and the settlement of the remaining
€0.6 million debt arising from the acquisition of > Consolidated Statement of Profit or Loss
Interest and dividends collected, interest (paid) (7) (7)
Caffemotive S.r.l., withheld as a guarantee; > Consolidated Statement of Comprehensive Income
CASH FLOWS FROM OPERATING ACTIVITIES 338 236
Purchase of property, plant and equipment (109) (90) > Consolidated Statement of Cash Flows
Purchase of intangible assets (26) (21) > Consolidated Statement of Changes in Equity
Other disbursements for investment activities - (1)
Acquisitions (31) (20)
CASH FLOWS FROM INVESTING ACTIVITIES (166) (132) NOTES TO THE CONSOLIDATED
Dividends paid (33) (51) FINANCIAL STATEMENTS
CASH FLOWS FROM FINANCING ACTIVITIES (33) (51)
Other scope and non-monetary changes 50 (40)
Exchange rate effect (8) 7 The following is a reconciliation between the net financial position at 31 December 2020 and the net financial posi-
CASH FLOWS GENERATED (USED) 181 20 tion at 31 December 2021:
Net financial position at year-start 102 82

600 Financial Statements
at 31 December 2021
Net financial position at year-end 283 102
30
(*): Some figures relating to the comparison period have been reclassified in order to facilitate data comparability 500 57
400
312 ACCOUNTING STATEMENTS
-135 > Balance Sheet
€283
As highlighted in the following chart, net financial position was positive for €283 Positive NFP at 300 -61
42 283
-33
million (compared to €102 million at 31 December 2020), with a €203 million discre- -31
200
tionary cash generation from core activities, sharply growing from €125 million in
102
2020, thus confirming the Group’s solidity, which improves year after year. 100
In detail, the positive flows generated by EBITDA were €312 million, further increased
by the positive change in net working capital of €30 million, the change in provisions
million 0 NOTES TO THE FINANCIAL STATEMENTS
NFP EBITDA Change in Change in Net capital Taxes and Dividends New Other NFP
and non-monetary components totalling €57 million overall; by contrast, taxes and Operating cash 1.1.2021 provisions NWC expenditure interest paid paid acquisitions changes 31.12.2021
interest expense paid (€61 million) and net investments in operating activities (€135 generation at and other
changes
and collected
million) reduced discretionary cash generation. €203 million INDEPENDENT AUDITORS’ REPORT

32 33 PRINT PDF
Risk Management Interest rate risk

COMPANY OFFICERS
For the first half of the year, US and European central banks moved in a synchronised manner to provide liquidity
GROUP STRUCTURE
The Group has adopted an internal control system, based on organisational rules, procedures and structures that support to the system that was starting the economic recovery. In particular, the ECB further accelerated the pace
allow the business to be run properly and in line with the goals set through an appropriate process for identifying, of PEPP programme purchases during February. LETTER TO SHAREHOLDERS
measuring, managing and monitoring the main risks. In the last quarter, on 22 September, the Federal Reserve announced the start of tapering, while the ECB continued
An effective internal control and risk management system is instrumental to ensuring protection of corporate as- to support its view of temporary inflation. DIRECTORS’ SINGLE REPORT
sets, the efficiency of business operations, the reliability of the information supplied to the corporate bodies and the On 15 December, Federal Reserve Chair Jerome Powell definitively stated that inflation posed a major threat and ON OPERATIONS
market, and compliance with laws and regulations. therefore the pace of reduction in assets purchases was doubled with a possible conclusion of the programme in
In 2021, the Group further strengthened its oversight of the Enterprise Risk Management (ERM) process. March 2022. In addition, there are now three estimated rate hikes for next year.
The focus of the ERM framework is to identify and manage risks, preserving value creation and ensuring the achieve- The ECB confirmed on 16 December that it would end net purchases of PEPP programme securities on March 22. At LAVAZZA GROUP
ment of the Group's objectives. the same time, it assured that liquidity support would continue with the Asset Purchase Programme (APP). The an-
nouncement was considered by the market to be moderately aggressive given the uncertainties about the Omicron Consolidated Financial Statements
variant and, as a result, helped the Euro react positively, rising above 1.13 against the Dollar.
The yield on the ten-year US Treasury bond started the year at 0.915% and then continued to rise sharply to the peak
at 31 December 2021
of 1.742% reached on March 21. Afterwards, it dropped down to 1.17% in August and then recovered in conjunction
Exchange rate risk

with the FED's announcements to start tapering, only to settle in recent weeks in the 1.45% area. Market-anticipated
rate hikes in the first half of 2022 had a greater impact on the two-year US rate curve, which tripled its yield from ACCOUNTING STATEMENTS
September (0.20%) to the end of December (0.66%). > Consolidated Statement of Financial Position
The 10-year Bund had a yield that remained in negative territory throughout 2021, reflecting, although to a lesser
The two main issues, which are closely interlinked and had a major influence on the foreign exchange market during extent, the Treasury trend and going from the start of year lows of (0.604%) to the highs of (0.086%) in October and > Consolidated Statement of Profit or Loss
2021 were inflation (actual and expected) and the inflation-related manoeuvres by the various central banks. then falling back to (0.36%) at the end of the year. > Consolidated Statement of Comprehensive Income
In addition, the countries' different vaccination rates, the resurgence of Covid-19 clusters with the related restrictions The ten-year BTP-Bund spread has been affected by Italian political events, touching 126 bps in January during the
and the appearance of new variants led to risk-on/risk-off moments and the consequent appreciation of currencies Conte government crisis and benefiting instead from Draghi’s appointment that then brought a significant reduc-
considered to be safe havens in these latter phases. tion in the perception of risk on the part of investors. The spread, also supported by better-than-expected Italian > Consolidated Statement of Changes in Equity
All countries, after the collapse in GDP suffered in 2020 as a result of Covid, returned to growth in 2021 resulting in a economic data, gradually narrowed to 90.6 bps, but then returned to the 130 bps area at the end of the year due to
sharp increase in demand for raw materials, semi-finished and finished products. The supply difficulties in meeting inflationary fears on the one hand, and the search for a safe haven (Bund) following the Covid waves in Europe on
the newly emerged needs and the critical logistic issues caused a surge in the prices, first of commodities and then the other. NOTES TO THE CONSOLIDATED
of goods and services in general. The annual inflation data published in November for the USA confirmed a 6.8% Following the new bank loan taken out, the interest rate risk was hedged in full by changing from a variable to a fixed
figure, a value that had not been recorded for about forty years. rate using Interest Rate Swap instruments.
In the first half of the year, all central banks considered inflation to be a transitory phenomenon and were tolerant INDEPENDENT AUDITORS’ REPORT
of accepting data above the targets set.
Commodity price risk

June saw the monetary authorities start to adopt a divergent approach to the price rises, with the Federal Reserve
and the Bank of England announcing the beginning of quantitative easing tapering and the market, as a result, pric-
ing in likely rate hikes as early as 2022, while the ECB remained in a wait-and-see mode also in the face of Germany's
unsatisfying economic data and the resurgence of Covid-19 on the continent. The Euro’s performance against the LUIGI LAVAZZA S.p.A.
Dollar was affected by the constantly improving US economic data and US real rates which, albeit negative, were The year 2021 was particularly turbulent for all commodities, including those in the agricultural sector.
more attractive than Euro rates. The recovery of global growth, after the sharp slowdown in 2020 due to Covid-19, and the growing logistical difficul- Financial Statements
After starting the year at 1.2215, the EUR/USD ratio, which peaked at 1.2327 on 6 January, remained in the
1.16-1.2250 range until the summer. Afterwards, with US inflation data constantly above 5%, as of July the Euro
ties both in finding ships and containers, along with investors' search for yield combined with protection from rising
inflation, led to year-on-year price increases with double-digit percentages.
at 31 December 2021
depreciated against the USD to a low of 1.1199 on 24 November. The average annual exchange rate was 1.1855. Coffee is the agricultural commodity that has suffered the most significant rise in prices, recording an 81% increase ACCOUNTING STATEMENTS
Volatility continued to stand at historical lows at around 6.2%. on Arabica since the beginning of the year and beating both the global commodity index and the energy and indus-
As in previous years, currency needs for purchasing raw material were met primarily through forward purchases. trial metals sectors. Robusta grew by 78%. > Balance Sheet
The most significant currency exposures arising from sales in countries with currencies other than the Euro were In addition to the reasons common to other raw materials, the coffee trend was affected by a particularly inclement > Statement of Profit or Loss
monitored and hedged. year in terms of weather. First the drought in Brazil resulted in a poor Arabica harvest in an already off-cycle year,
No speculative transactions are undertaken in managing exchange rate risks. then in July the worst frost in decades made next year's harvest forecast particularly critical.
In Colombia, too heavy rains are putting at risk the production of the 14 million bags that the market expected.
As for Robusta, the harvest was good in Brazil and, despite some delays due to persistent rain, it also promises to be
excellent in Vietnam (31 million bags). NOTES TO THE FINANCIAL STATEMENTS

34 35 PRINT PDF
The logistical difficulties triggered first by a Chinese recovery that had already begun at the end of 2020, then the
problem in March of the Suez Canal obstruction spread the delays worldwide. Subsequently, the closures of a num- The commitment to the social and
environmental sustainability of the
ber of important Chinese ports due to Covid-19 outbreaks exacerbated the situation that today features bottlenecks
along the entire supply chain and prevents a regular flow of coffee out of the countries of origin. COMPANY OFFICERS
The arbitrage between the two varieties reached 140 $cts/lb, representing the highest values of the last 3 years, due
GROUP STRUCTURE
to Arabica rising more than Robusta.
In this context, speculative funds have taken increasingly important purchasing positions, approaching the highs on
both Arabica and Robusta.
Group’s activities LETTER TO SHAREHOLDERS
With reference to the price analysis, Arabica on the New York Market opened the year (in second position) at $128.10 DIRECTORS’ SINGLE REPORT
cts/lb and then touched a low on 6 January at $122.95 cts/lb. Peak volatility (80%) was reached in July 2021 with the ON OPERATIONS
frost and, after a partial recovery in prices in August as concerns were dispelled about further cold fronts, the trend
Integrating sustainability in its operations

continued driven above all by logistical tensions, peaking at $249.85 cts/lb on 6 December.
Robusta on the London Market essentially replicated the Arabica trend, despite being unaffected by the frost in LAVAZZA GROUP
Brazil, but having, on the other hand, suffered heavy lockdowns in Vietnam and the logistical difficulties already
illustrated. The year opened with a price of $1,372/ton, then recorded a low of $1,302/ton on 12 January followed by Consolidated Financial Statements
a continuous climb to a peak of $2,315/ton on 6 December 2021. The Lavazza Group is committed toward conducting its business in an economically, environmentally and socially
sustainable way.
at 31 December 2021
The uncertainty about the severity of the Omicron variant is having contrasting effects: on the one hand it could Making the most of its human resources and the territories and communities in which it operates and minimising
reduce demand due to new closures and greater use of remote working, on the other it could further complicate the the environmental impact of its activities are the pillars of Lavazza’s approach to doing business. This approach has
logistical framework in the countries of origin. allowed the Company to organise a programme of coordinated initiatives in Italy and in the countries where it oper- ACCOUNTING STATEMENTS
ates, in order to promote the integration of sustainability in all areas of the business. > Consolidated Statement of Financial Position
In line with previous years, the coffee price risk was managed through physical hedging and non-speculative
derivatives. > Consolidated Statement of Profit or Loss
Credit risk
2021 was still a complicated year given the pandemic’s persisting effects on the whole world of Away From Home
consumption. Despite this situation, credit performance indicators have improved, especially in the Ho.Re.Ca. world
thanks to a tight focus on maturities and risk exposures in the Travel and Hospitality world. There has been a sharp INDEPENDENT AUDITORS’ REPORT
reduction in late payments in the domestic market where no critical issues have been reported in the world of retail
chains.
The extension of the credit protection programme to higher hierarchical levels of the commercial organisation has
contributed to a better and more strategic management of deferred payments. The DSO decreased both as regards
the parent company and at consolidated level. LUIGI LAVAZZA S.p.A.
The credit protection of foreign distributors served by the Parent Company with non-recourse factoring tools for
insurance purposes was maintained over 90%. Financial Statements
at 31 December 2021
> Balance Sheet


36 37 PRINT PDF
The Sustainability Report of the Lavazza Group

COMPANY OFFICERS
Transparency towards all stakeholders is an essential principle that guides the Lavazza Group in all its activities
GROUP STRUCTURE
and also translates into the decision to prepare annually, on a voluntary basis, the Group Sustainability Report,
published for the first time in 2014: the document reports the Company's sustainability path, a path in which sus- LETTER TO SHAREHOLDERS
tainability is gradually integrated into all business activities, reflecting its commitment around the world through
its leading companies. DIRECTORS’ SINGLE REPORT
Since the first edition, it has been drawn up according to the GRI - Global Reporting Initiative Standards, the main ON OPERATIONS
international reference criteria for the reporting of sustainability performance, and is subject to limited review by an
external assurance company, which issues the audit letter published in the Report.
LAVAZZA GROUP
The eighth edition of the Group’s Sustainability Report for 2021, entitled “A Goal in every Cup”, is also a tool used to
report Lavazza’s commitment to the UN Global Goals, to which four chapters are devoted, each for one of the four Consolidated Financial Statements
Priority Goals identified by the Company: Goal 5 – Gender Equality, Goal 8 - Decent Work and Economic Growth, Goal
12 – Responsible Consumption and Production, Goal 13 – Climate Change. One of the aforementioned chapters is
at 31 December 2021
dedicated to the Lavazza Foundation.
The Sustainability Report contains information on the Group's sustainability programmes, examples of which are
given below. ACCOUNTING STATEMENTS

1. Expanding Community Engagement - Goal 5 and Goal 8:
In 2021, support for communities, the supply chain and employees was further developed, on the one hand through > Consolidated Statement of Changes in Equity
the development of an already well-established programme of care and attention initiatives and, on the other hand,
of specific actions linked to the health emergency. One example of this is the Nuvola Lavazza – CV19 Hub, the vacci-
nation centre created thanks to the company’s provision of the Nuvola premises to the Local Health Authority, which NOTES TO THE CONSOLIDATED
between spring and autumn 2021 allowed the vaccination of 150,000 people. In addition, 2021 saw the consolidation
of Gap Free, the new long-term programme of actions aimed at building an inclusive and gap-free company for the
development of a work environment in which everyone can express their authenticity, one of the Group’s four found- INDEPENDENT AUDITORS’ REPORT
ing values. Moreover, in order to tackle issues particularly relevant to the Company, such as children’s rights and
human rights, several supply chain projects were implemented in partnership with traders and specialised NGOs
including Save the Children and Oxfam.

2. Accelerating efforts to combat the effects of climate change through innovation and sustainable environ-
mental development strategies – Goal 13 and Goal 12: Financial Statements
Through a scientific and integrated bean-to-cup process, the Group has outlined a well-structured environmental
at 31 December 2021
sustainability strategy in which the commitment to the fight against climate change is achieved through various ACCOUNTING STATEMENTS
intervention programmes. One example of this is the Sustainable Packaging Roadmap, which is based on circular
economy principles, aiming to make the entire Group's packaging portfolio reusable, recyclable or compostable by > Balance Sheet
2025. The goal is to ensure top quality coffee with the lowest possible environmental impact, thanks to continuous > Statement of Profit or Loss
process and product innovation.
In parallel, the Roadmap to Zero is another plan that aims to gradually bring the Group to "carbon neutrality", in
other words to zero the impact of all its CO2 emissions, thanks to balancing the emissions produced against their
absorption, through reduction, but also offsetting, programmes. The process began in 2020 with the offsetting of
Scope 1 and Scope 2 emissions, in other words those under the direct control of Lavazza Group companies; from 2021 NOTES TO THE FINANCIAL STATEMENTS
the process has continued with the gradual offsetting of Scope 3 indirect emissions, namely those due to activities
that are not under the direct control of the company.
Photo credits by Roger Lo Guarro

38 39 PRINT PDF
3. The non-profit Giuseppe and Pericle Lavazza Foundation
Each year, the Group supports the non-profit Giuseppe and Pericle Lavazza Foundation, established in 2004 to
coordinate and develop sustainability projects: in 2021, the Foundation financed 32 projects, with over 130,000 ben- COMPANY OFFICERS
eficiaries. To date, the countries involved are 20 on three continents: Dominican Republic, Haiti, Cuba, Guatemala,
GROUP STRUCTURE
El Salvador, Honduras, Colombia, Peru, Brazil, Mexico, Nicaragua, Ecuador, Yemen, Uganda, Tanzania, Ethiopia,
Burundi, Vietnam, India, Indonesia. LETTER TO SHAREHOLDERS
The projects supported by the Lavazza Foundation are primarily intended to increase coffee yields and quality, while
also promoting entrepreneurship among coffee growers and improving their living conditions. The path taken by DIRECTORS’ SINGLE REPORT
the Foundation is to support the autonomy of local communities, through the enhancement of women's work and ON OPERATIONS
the involvement of the new generations, which is accompanied by the sharing of good agricultural practices and the
introduction of technological tools to combat the effects of climate change. The activities also focus on production
diversification, to counter soil impoverishment, and on support for reforestation, a process that is essential for re- LAVAZZA GROUP
storing the health of the ecosystem. The performance of all these activities is entrusted to local operators, to facil-
itate the involvement of coffee-growing communities and build relationships of trust between the parties involved. Consolidated Financial Statements
In addition to its commitment to coffee-growing communities, the Foundation has also allocated, for the second year
running, a specific fund for the response to the Covid-19 emergency, which has supported 20 additional projects in
at 31 December 2021
14 countries, supporting 17 Non-Governmental Organisations working in the health, social and educational fields.
The health, workplace safety, energy

and environment management system NOTES TO THE CONSOLIDATED

Within the framework of the implementation of the Group’s Health, Safety and Environment (HSE) Guidelines and
the Corporate Workplace Health and Safety Policy, the Company continued to implement an Integrated Health,
Workplace Safety, Energy and Environment Management System (SG-SSEA), in line with the ISO 14001 and ISO
45001 standards of reference. LUIGI LAVAZZA S.p.A.
The SG-SSEA is coordinated by the HSE Department and managed through a dedicated company portal.
With regard to Luigi Lavazza S.p.A., the ISO 45001 (Occupational Health and Safety Management System) multiplant Financial Statements
certification was obtained for the Nuvola headquarters, the Innovation Center and the Turin, Gattinara, Pozzilli and
1895 plants, as well as for Milan's top shop; the ISO 14001:2015 (Environmental Management System) certification
at 31 December 2021
was confirmed for the Nuvola headquarters, the Innovation Center and the Turin, 1895, Gattinara and Pozzilli plants. ACCOUNTING STATEMENTS
At the Lavazza Group level, the ISO 14001:2015 (Environmental Management System) certifications for Luigi Lavazza
S.p.A., Lavazza Professional UK Ltd, Lavazza Professional North America LLC and Carte Noire Operations S.a.s. were > Balance Sheet
confirmed, while Luigi Lavazza S.p.A., Lavazza Professional UK Ltd, Lavazza Professional North America LLC and > Statement of Profit or Loss
Carte Noire Operations S.a.s. were certified ISO 45001.
The Company applied for and was awarded the appropriate extensions of its environmental permits required for the
use of its production facilities.
In occupational health and safety, no serious accidents occurred and the main occupational accident indicators
continued to decline in terms of both frequency and severity. NOTES TO THE FINANCIAL STATEMENTS

40 41 PRINT PDF
Research and development Relationship with personnel

COMPANY OFFICERS
GROUP STRUCTURE
In 2021, research and development took a huge leap For KLIX systems, distributed through professional For the Lavazza Group, a global company with its heart The Group personnel cost has risen compared to the
forward in organisational, result and investment terms. companies, the range of beverages offered in paper in Italy, employees have always been the main resource, previous year. LETTER TO SHAREHOLDERS
The organisation continues to adapt to market needs cups (content of more than 96% and with a benefit in those who possess the skills and passion with which The main increases are linked to normal remuneration
through synergies between R&D functions (machines, terms of CO2 reduction of up to 60%) has been signifi- they contribute daily to the Group’s growth. dynamics (salary review and mandatory increases) and DIRECTORS’ SINGLE REPORT
systems and food), between geographies (with ma- cantly expanded to replace plastic cups, which are less Lavazza implemented, in all phases of the health staff recruitment policies that have, however, been lim- ON OPERATIONS
chine, food and Lavazza Professional Systems teams) sustainable. emergency still ongoing in 2021, all the prevention ited to supporting priority projects for the business, for
and extending its skills through the creation of the measures required to ensure the highest possible safe- product development and to strengthen skills in cer-
Scientific and Regulatory Affairs function. The development of the machines has supported the ty standards and fully protect the health and safety of tain staff areas as a result of the increased complexity LAVAZZA GROUP
The resources aim to generate high sensory quality connection and proximity with the end consumer. its people and its contractors. With the sense of respon- requiring greater central coordination.
products that are increasingly sustainable with regard In the HCS area, the Voicy machine, with its integrated sibility that has always guided the way it operates, the In addition, the positive result of 2021 led to a far high- Consolidated Financial Statements
to the food and packaging areas, while in the machine
field the goal is to eliminate the distance with partners
Alexa voice assistant, was launched on the market.
Models equipped with telemetry have been launched
Group, also contributed to the creation of a vaccination
hub on the Nuvola premises, which has administered
er forecast for bonus payments and MBO programmes
than in 2020, with a consequent increase in the associ-
at 31 December 2021
and consumers through connectivity tools. for the first time in the OCS world for the Firma range. 150,000 doses of vaccine. Open Days were organised ated cost. The other items linked to variable remunera-
This will help consumers to obtain better in-the-cup with free access for people not only to the hub but also tion (overtime, holidays, travel allowances, etc.) saw an
2021 was characterised both by the launch of products quality and the commercial partners to manage the to the Lavazza Museum, an initiative that was very suc- increase due to the resumption of normal activity but ACCOUNTING STATEMENTS
reflecting Lavazza's history such as the new ¡Tierra! machine inventory more and more efficiently. cessful. In addition, to support the Borgo Aurora shops without particular changes compared to the previous > Consolidated Statement of Financial Position
range and by the launch of innovative products such In Food Service we are continuing to extend the range hit hard by the pandemic, people who came for vacci- year which had recorded a significant reduction, since
as the new Carte Noire Ready to Drink range for the of models available with telemetry and this will enable nation at the hub were provided with a gift voucher to remote work also continued in a structural way along- > Consolidated Statement of Profit or Loss
French market as well as by the new FLOS drinks for the new machines installed to be monitored in terms of have a coffee in one of the cafés supplied by Lavazza in side, for example, other actions such as the reduction > Consolidated Statement of Comprehensive Income
Food Service: a refreshing mix of cold brew and fruit machine quality and yield. the Nuvola district. Finally, in December 2021, Lavazza or containment of travel and business trips.
juice, natural drinks, organic and with no added sugars. supported the Turin Local Health Authority in install- Excluding the bonus-related effect, the cost increase
ing the technology for the opening of another vaccina- stood at 1.7%. > Consolidated Statement of Changes in Equity
Consistency with the environmental sustainability is- tion hub at the Peace Arsenal. Finally, the government relief measures linked to the
sues is assured by a continual process of sustainabil- pandemic situation, which had been granted in 2020
ity integration along the entire supply chain based on The utmost attention to people and their professional (especially in France), have been significantly reduced NOTES TO THE CONSOLIDATED
a programme for innovating products — through the development in terms of skill, flexibility and versatility in the current year. This phenomenon, linked to the
sustainable-by-design approach — and processes that is confirmed by the increasing number of programmes gradual resumption of normal activities especially in
leads to a concrete and measurable plan for reducing that aim to improve work organisation and enhance the the Food Service and OCS channels, further contrib- INDEPENDENT AUDITORS’ REPORT
the Group's impacts. best talents. Corporate welfare and tools for work-life uted to the increase in labour costs compared to the
The results are visible both in the field of recyclable balance are among the Group’s priorities and are con- previous year, restoring a situation comparable to the
flexible packs, where the long-term programme considered to be accelerators of positive growth. For ex- pre-pandemic period.
tinues to be implemented and will lead to a 40% re- ample, in this sense, 2021 saw confirmation of the Top
duction in CO2-related impacts by 2025, and in cap- Employer certification, which ranks Lavazza among the LUIGI LAVAZZA S.p.A.
sules, where the compostable A Modo Mio range has most advanced companies in terms of quality of work-
been accompanied for the first time with compostable ing conditions for its employees. Financial Statements
solutions for the BLUE and Firma systems in the OCS,
Vending and Food Service channels. The capsule world
Investments have also been made in Digital HR, both
regarding communication and performance-related
at 31 December 2021
also saw the launch of the new aluminium compatible aspects, and e-learning platforms. ACCOUNTING STATEMENTS
Nespresso2 range with neutralisation of CO2 impacts
through the purchase of carbon offset credits. As the central theme is people development in terms of > Balance Sheet
inclusion and diversity, existing initiatives such as the > Statement of Profit or Loss
“GAP free” programme were further strengthened in
2021, at the same time as expanding training, teaching,
welfare and care programmes to ensure equal oppor-
tunities for people within the company.
Another example is the inclusion of disabled personnel NOTES TO THE FINANCIAL STATEMENTS
in the company in collaboration with the Edu-Care co-
operative and the Job Stations project.
2 Lavazza is not affiliated with, endorsed or sponsored by Nespresso. SUSTAINABLE SINGLE PAGE
42 43 PRINT PDF
The Parent Company LUIGI LAVAZZA S.p.A.

COMPANY OFFICERS
GROUP STRUCTURE
The figures of this section are illustrated in compliance with Italian GAAP (OIC).
Operating and financial performance of Reclassified statement of profit or loss of ON OPERATIONS
Luigi Lavazza S.p.A. Luigi Lavazza S.p.A.

LAVAZZA GROUP
The following table shows the Luigi Lavazza S.p.A.’s operating and financial highlights at 31 December 2021 compared Consolidated Financial Statements
with the previous year:
€ million 12.2021 RATIO % 12.2020 RATIO % CHANGES CHANGES %
at 31 December 2021
Net revenues 1,660.7 100.0% 1,521.0 100.0% 139.7 9.2%
€ million
YEAR 2021 RATIO % YEAR 2020 RATIO % Other income and revenues 129.9 7.8% 103.9 6.8% 26.0 25.0%
Net revenues 1,660.7 100.0% 1,521.0 100.0% Total income and revenues 1,790.6 107.8% 1,624.9 106.8% 165.7 10.2%
EBITDA 236.5 14.2% 189.6 12.5% Cost of sales 756.3 45.5% 724.1 47.5% 32.2 4.4% > Consolidated Statement of Financial Position
EBIT 111.2 6.7% 87.1 5.7% Costs of services 580.2 34.9% 498.2 32.8% 82.0 16.5% > Consolidated Statement of Profit or Loss
Profit before taxes 135.7 8.2% 111.0 7.3% Other costs 43.3 2.6% 50.0 3.3% (6.7) (13.4%)
Profit for the year 103.6 6.2% 91.5 6.0% > Consolidated Statement of Comprehensive Income
Total external costs 1,379.8 83.1% 1,272.3 83.5% 107.5 8.4%
Value added 410.8 24.7% 352.6 23.2% 58.2 16.5% > Consolidated Statement of Cash Flows
Net working capital 409.4 428.8 Personnel costs 174.3 10.5% 163.0 10.7% 11.3 7.0% > Consolidated Statement of Changes in Equity
Net fixed assets 2,222.9 2,230.2 EBITDA 236.5 14.2% 189.6 12.5% 46.9 24.7%
Total uses 2,632.3 2,659.0 Amortisation, depreciation and
102.1 6.1% 89.6 5.9% 12.5 13.9%
Net financial position 233.9 378.3 write-downs
Provisions 23.2 1.4% 12.9 0.8% 10.3 79.8%
Equity 2,398.4 2,280.7
EBIT 111.2 6.7% 87.1 5.7% 24.1 27.6% FINANCIAL STATEMENTS
Total sources 2,632.3 2,659.0
Income (expense) from investments 25.5 1.5% 30.1 2.0% (4.6) (15.2%)
Financial income (expense) (1.0) (0.1%) (6.2) (0.4%) 5.2 (84.4%)
Capex 64.5 56.3
Profit before taxes 135.7 8.2% 111.0 7.3% 24.7 22.3%
Headcount 1,781 1,741
Income taxes (32.1) (1.9%) (19.5) (1.3%) (12.6) 64.6%

Profit for the year 103.6 6.2% 91.5 6.0% 12.1 13.3%
ROS 6.7% 5.7%
ROI 9.8% 7.2%
Net revenues amounted to €1,660.7 million, up 9.2% compared to €1,521.0 million for 2020.
ROE 4.3% 4.3% Financial Statements
EBIT amounted to €111.2 million, up €24.1 million compared to €87.1 million for 2020. EBIT margin improved going
from 5.7% to 6.7%.
at 31 December 2021
Profit before taxes amounted to €135.7 million, up by €24.7 million compared to €111.0 million for the previous year,
and was chiefly affected by the positive increase of retail sales, which is also supported by an excellent expansion > Balance Sheet
of the e-commerce channel and a recovery, albeit gradual, of the Away From Home channels compared to 2020. > Statement of Profit or Loss

Profit for the year amounted to €103.6 million, up €12.1 million compared to 2020.


44 45 PRINT PDF
Reclassified balance sheet of Luigi Lavazza S.p.A. (*)

COMPANY OFFICERS
GROUP STRUCTURE
€ million
2021 2020 CHANGES Net working capital amounted to €409.4 million, down €21.5 million compared to €430.9 million at 31 December DIRECTORS’ SINGLE REPORT
Inventories 312.8 290.7 22.1 2020. The change was mainly attributable to the following components: ON OPERATIONS
Trade receivables 115.1 102.1 13.0
Receivables from subsidiaries, associates and Parent 279.3 251.0 28.3 > a €22.1 million increase in inventories, chiefly driven by the higher green coffee purchase price;
Deferred tax assets 59.9 50.4 9.5 LAVAZZA GROUP
Other prepayments and accrued income 37.1 37.7 (0.6)
> a €13.0 million increase in trade receivables and receivables from subsidiaries and associates amounting to €28.3
Property, plant and equipment held for sale
A. Total operating assets 810.4
6.2 8.4
740.3
(2.2)
70.1
million, linked to the increase in sales recorded during the year; Consolidated Financial Statements
Trade payables 278.7 204.3 74.4
> a €74.4 million increase in trade payables linked to a gradual increase, especially in the second half of the year, of
at 31 December 2021
Payables to subsidiaries, associates and Parent 25.4 25.7 (0.3)
Tax payables and payables to social security institutions 11.5 14.7 (3.2) sales promotions and support initiatives, as well as logistic costs and other payables amounting to €20.6 million.
Other liabilities and deferred income 85.3 64.7 20.6
B. Total operating liabilities 400.9 309.4 91.5 Net fixed assets totalled €2,385.6 million, compared to €2,361.4 million at 31 December 2020. ACCOUNTING STATEMENTS
C. Net working capital 409.4 430.9 (21.5) The €22.7 million decrease in intangible assets was the result of the combined effect of higher investments for €21.0 > Consolidated Statement of Financial Position
Intangible assets 523.2 545.9 (22.7) million, chiefly attributable to the capitalisation of costs of software for long-term use, and the effect of the merger
Property, plant and equipment 365.2 375.3 (10.1)
of the company Caffemotive S.r.l. for €3 million, as well as the rise in amortisation for the year amounting to €46.7 > Consolidated Statement of Profit or Loss
Financial assets 1,497.2 1,440.2 57.0
million. > Consolidated Statement of Comprehensive Income
D. Total fixed assets 2,385.6 2,361.4 24.2
Provisions 150.6 120.7 29.9
The net decrease in property, plant and equipment amounting to €10.1 million, mainly involving plant, machinery
Employee termination indemnities 12.1 12.6 (0.5) and equipment, was chiefly attributable to the increase in total capital expenditure, net of disposals of €16.3 million,
E. Total fixed liabilities 162.7 133.3 29.4 offset by higher depreciation and write-downs for the year totalling €26.4 million. > Consolidated Statement of Changes in Equity
F. Total net fixed assets 2,222.9 2,228.1 (5.2)
G. Total invested capital, net - Uses (C + F) 2,632.4 2,659.0 (26.6) The €57.0 million increase in financial assets was mainly attributable to the €30 million investment in Y&L Ltd
Cash and cash equivalents (483.3) (179.3) (304.0) formed from the Joint Venture with Yum China and the capital injections in Lavazza Professional Holding Europe NOTES TO THE CONSOLIDATED
Financial assets other than fixed assets 88.2 93.2 (5.0) S.r.l. and Lavazza Professional Holding North America Inc., for €19.0 million and €10.4 million, respectively, offset
Financial liabilities 629.0 464.4 164.6 FINANCIAL STATEMENTS
by the decrease in financial receivables from subsidiaries and the reduction in derivatives.
H. Net financial position 233.9 378.3 (144.4)
Capital 25.0 25.0 - INDEPENDENT AUDITORS’ REPORT
Reserves 724.2 677.0 47.2
Provisions rose mainly due to the greater provisions for personnel and other provisions for litigation and for risks
Retained earnings 1,545.6 1,487.2 58.4 associated with several issues.
Profit for the year 103.6 91.5 12.1
I. Equity 2,398.4 2,280.7 117.7 Net financial position was negative at €233.9 million, improving by €144.4 million compared to 2020.
L. Total sources (I + H) 2,632.3 2,659.0 (26.7) The increase mainly refers to the positive operating cash generation. LUIGI LAVAZZA S.p.A.
(*) Some figures relating to the comparison period have been reclassified in order to facilitate data comparability Financial Statements
at 31 December 2021
> Balance Sheet


46 47 PRINT PDF
Reclassified statement of cash flows of

Luigi Lavazza S.p.A. (*) COMPANY OFFICERS
GROUP STRUCTURE
€ million YEAR 2021 YEAR 2020 Net Cash flows from operating activities were positive at €250.4 million, significantly benefiting from the positive DIRECTORS’ SINGLE REPORT
earnings component (result for the year plus non-monetary costs) of €228.9 million, in addition to the liquidity gen- ON OPERATIONS
Profit for the year 103.6 91.5 erated by the change in net working capital of €21.5 million.
Amortisation and depreciation 98.0 84.2
Net change in employee termination indemnities (0.4) (1.1) Cash flows from investing activities had an overall negative net balance of €120.1 million, composed of: LAVAZZA GROUP
Net change in provisions 29.9 24.8
Write-downs of equity investments and securities included in fixed assets (3.9) 3.0 > net purchases of intangible assets (€21.0 million), mainly attributable to the capitalisation of projects relating to Consolidated Financial Statements
Other write-downs of fixed assets
Revaluation of property, plant and equipment
2.8
0.0
2.6
(66.9)
software for long-term use and development costs for investments in technological innovation;
at 31 December 2021
Revaluation reserve 0.0 64.9 > net purchases of property, plant and equipment (€43.5 million), chiefly involving plant and machinery for the
Net effect of merger (1.1) 0.20 development of a new capsule packaging line and a coffee transport service for the roasting machines;
Dividends accrued to be received - (4.0) ACCOUNTING STATEMENTS
Changes in items of net working capital > recapitalisations of investments in the subsidiaries Lavazza Professional Holding North America Inc. and Lavazza > Consolidated Statement of Financial Position
- inventories (20.0) (30.1) Professional Holding Europe S.r.l. (€29.4 million) owing to the need to support operating investees of both com-
- trade receivables (13.0) 17.1 panies during the Covid-19 pandemic, which caused the drop of Away From Home consumption; > Consolidated Statement of Profit or Loss
- receivables from others and other assets (37.1) 24.9
- trade payables 74.4 (45.0) > a 35% capital increase in Y&L Coffee Ltd (€30.3 million), which is the special purpose vehicle through which Yum
- other payables and liabilities 17.2 33.2 > Consolidated Statement of Cash Flows
China Holdings and the Lavazza Group entered into a joint venture aimed at studying and developing the Lavazza
Coffee Shop concept in China; > Consolidated Statement of Changes in Equity
Cash flows from (used for) operating activities 250.4 199.3
> acquisition of the company Lavazza Japan GK (€0.4 million) acquired in the year by Lavazza Professional Holding
Net purchases of: North America Inc., as part of a reorganisation of the Group’s structure;
- intangible assets (21.0) (19.1)
- property, plant and equipment (43.5) (37.2) FINANCIAL STATEMENTS
> decrease in other financial instruments (€4.5 million).
- investments in subsidiaries, associates and other companies (60.1) (51.6)
- other non-current financial assets 4.5 9.6
The positive change in the balance of the OCFFA reserve during the year is attributable to the revaluation of the for-
eign exchange derivatives portfolio (resulting from the significant revaluation of the US Dollar against the Euro) and
Cash flows from (used for) investing activities (120.1) (98.3)
to the effect of the green coffee price risk hedging strategies that were implemented financially during 2021 (with a
positive result dictated by the growing market price trend) and the economic effects of which, due to the application
Dividends paid
Change in hedge reserve for expected cash flows
(33.1)
47.2
(50.2)
(12.5)
of hedge accounting, have been deferred to the 2022 financial year (in conjunction with the accounting recognition LUIGI LAVAZZA S.p.A.
of hedged supplies).
Cash flows from (used for) financing activities 14.1 (62.7)
Net cash flow for the year 144.4 38.3 at 31 December 2021
Net financial assets / liabilities at year-start (378.3) (416.6) ACCOUNTING STATEMENTS
Net financial assets / liabilities at year-end (233.9) (378.3) > Balance Sheet

(*) Some figures relating to the comparison period have been reclassified in order to facilitate data comparability


48 49 PRINT PDF
Treasury shares / shares of holding companies

COMPANY OFFICERS
The Parent Company, Luigi Lavazza S.p.A., owns 2,499,998 treasury shares of a nominal value of €1 each, fully paid up.
GROUP STRUCTURE
The Parent Company does not own and, during the financial year it did not buy and/or sell, any share of the Holding
Company either directly or through a trust company or other persons. LETTER TO SHAREHOLDERS
The Parent Company did not establish secondary offices in 2021.
Luigi Lavazza S.p.A., and the Italian Group companies together with their parent/consolidating company, Finlav S.p.A., DIRECTORS’ SINGLE REPORT
participated for the three-year period 2019-2021 in the Italian tax consolidation programme. ON OPERATIONS
With regard to compliance with privacy legislation, the Company conducted assessments in view of compliance with
the provisions of Regulation (EU) No. 2016/679 on the protection of natural persons with regard to the processing of
personal data. LAVAZZA GROUP
at 31 December 2021
Information on management and coordination activities > Consolidated Statement of Financial Position

The Parent Company is responsible for the management and coordination of its subsidiaries and it is not subject to
management and coordination by its Parent Company, Finlav S.p.A.


at 31 December 2021
> Balance Sheet


50 51 PRINT PDF
Corporate governance Organisational, Management and Control Model

as per Legislative Decree No. 231 of 8 June 2001 COMPANY OFFICERS
GROUP STRUCTURE
Luigi Lavazza S.p.A. has adopted a ‘traditional’ management and control model, marked by the presence of a man-
agement body, the Board of Directors, and a control body, the Board of Statutory Auditors. Audit is performed by In accordance with the provisions of Legislative Decree The Supervisory Body is currently made up of the fol- LETTER TO SHAREHOLDERS
independent auditors. The governance system is based on the general Italian statutes, the Articles of Association, No. 231 of 8 June 2001 on the “Administrative liabili- lowing members: Alessandro De Nicola (Chairman),
the Code of Ethics and the Lavazza Group’s internal rules and procedures. ty of legal persons, companies and associations even Simona Musso (Chief Legal Officer and General DIRECTORS’ SINGLE REPORT
without legal personality”, since 2006 Luigi Lavazza Counsel) and Maurizio Virano (Chief Internal Auditor). ON OPERATIONS
The Board of Directors is the central body of the corporate governance system. It has the broadest powers for the S.p.A. has adopted and subsequently updated an
management of the Company and the strategic guidance of the Lavazza Group, of which the Company is the Parent. Organisational, Management and Control Model (here- The Supervisory Body reports to the Board of Directors
In addition to its responsibilities under the law and the Articles of Association, the Board of Directors is also respon- under “231 Model”) with the aim of ensuring ethical and on the actual state of the 231 Model implementation LAVAZZA GROUP
sible for taking the most important decisions regarding economic and strategic matters. The Board of Directors is transparent conduct aimed at reducing the risk of the and the outcomes of the supervisory activity carried
currently composed of 15 members, who will remain in office until the approval of the 2022 Financial Statements: offences provided for by the aforesaid Decree. The 231 out, through a written half-yearly report, also ad- Consolidated Financial Statements
the Chief Executive Officer, an Executive Director, six Non-executive Directors members of the Lavazza Family and
seven independent and Non-executive Directors. The Board of Directors is chaired by Chairman Alberto Lavazza,
Model has been updated over time taking account of
the introduction of new predicate offences: the latest
dressed to the Board of Statutory Auditors, that illus-
trates the monitoring activities carried out, the critical
at 31 December 2021
supported by Vice Chairmen Giuseppe and Marco Lavazza and Chief Executive Officer Antonio Baravalle. update was approved by resolution of the Company’s issues that emerged and any appropriate corrective
Board of Directors on 11 December 2020. and/or improvement measures for implementing the
The Board of Statutory Auditors is the control body responsible for overseeing compliance with the law and the 231 Model. ACCOUNTING STATEMENTS
Articles of Association, respect for correct administration principles and, within its remit, adequacy of the inter- The task of overseeing the operation and observance > Consolidated Statement of Financial Position
nal control system and of the organisational, administrative and accounting structure and its actual functioning. of the 231 Model, and updating it, was attributed to a The 231 Model and the Code of Ethics are integral parts
The mandate of the Board of Statutory Auditors currently in office will expire upon approval of the 2021 Financial Supervisory Body vested with independent powers of of the Company's Internal Control System. The General > Consolidated Statement of Profit or Loss
Statements. initiative and control. Section of the 231 Model is published on the website > Consolidated Statement of Comprehensive Income
www.lavazzagroup.com; the Special Sections regarding
Statutory auditing for the three-year period 2019-2020-2021 has been assigned to the independent auditors EY S.p.A. In detail, in order to ensure greater effectiveness for the potentially relevant predicate offences are published
The independent auditors have been appointed in accordance with the Regulations of the Shareholders’ Meeting, controls on the efficacy of the 231 Model adopted, the on the corporate portal. > Consolidated Statement of Changes in Equity
upon proposal of the Board of Statutory Auditors, and operate independently and autonomously. Board of Directors of Luigi Lavazza S.p.A. considered it
appropriate to identify a collegiate Supervisory Body, Online training sessions on the 231 Law-related issues
composed of three members (two internal members are planned. NOTES TO THE CONSOLIDATED
who are Company managers and one external member,
acting as Chairman), which meets the autonomy and
independence, integrity, professionalism and continuity INDEPENDENT AUDITORS’ REPORT
of action requirements.
Antitrust Compliance Programme

The Company has defined an Antitrust Compliance There will be in-depth on-line and classroom training Financial Statements
Programme with the aim of identifying and assessing
a specific antitrust risk, and as a means through which
on antitrust issues, as well as periodic meetings with
exposed employees to deal with specific aspects of the
at 31 December 2021
the Company intends to renew and strengthen its com- subject. ACCOUNTING STATEMENTS
mitment to full compliance with the rules to protect
competition, already enshrined in the Code of Ethics as > Balance Sheet
a founding principle of the business ethics and value > Statement of Profit or Loss
system of the Lavazza Group.
Central elements of the Antitrust Compliance
Programme are: the Antitrust Manual, a consultation
tool for the use and benefit of those who maintain, on NOTES TO THE FINANCIAL STATEMENTS
behalf of Group companies, relationships with compet-
itors, customers, suppliers and other stakeholders, and
the Group Antitrust Compliance Officer (ACO), the first INDEPENDENT AUDITORS’ REPORT
point of reference for employees when there is doubt
about the compatibility of a certain behaviour with
competition law. SUSTAINABLE SINGLE PAGE
52 53 PRINT PDF
Privacy Organisational Model Outlook

pursuant to EU Regulation No. 679/2016 COMPANY OFFICERS
GROUP STRUCTURE
The year just begun promises to be extremely complex and challenging and will have to be faced with the same
The Company has adopted a Privacy Organisational services, involved in the processing of personal data as courage and constant determination that have allowed the Group to reach a historic milestone in terms of results LETTER TO SHAREHOLDERS
Model based on the definition of roles and responsibil- external Processors; the adequacy of the technical and in 2021.
ities in the processing of personal data. organisational measures for the protection of the risk DIRECTORS’ SINGLE REPORT
The Board of Directors of the company has identified, is continuously verified. It is believed that the war in Ukraine will not have a significant impact on the Group’s business despite the fact that, ON OPERATIONS
within the organisation, a Data Protection Officer (DPO) on the date these financial statements are prepared, all operations in Russia have been suspended and it is impos-
for the better coordination, at Group level, of legal ob- Of particular importance is the project to define the sible to supply the Ukrainian market.
ligations, as well as for the control and monitoring of personal data retention period, due to the major im- LAVAZZA GROUP
the application of the rules of the European Regulation pact that data deletion has on company information If the Covid-19 pandemic now seems to have decreased in intensity and scope, thanks both to the effectiveness of
on the processing of personal data and the company systems. the vaccination campaign and to the arrival of the spring season, the Group’s attention is currently focused on the Consolidated Financial Statements
policies and procedures adopted on Privacy matters.
Finally, the project to adopt the BCR (Binding Corporate
exceptional increase in the price of all the raw materials we deal with such as: green coffee primarily, but also pack-
aging, energy and logistics costs.
at 31 December 2021
In particular, assessment and mapping activities have Rules) was launched, a tool allowing the transfer of
been carried out on data processing, described in the personal data within the Group to non-EU subsidiaries. The strong price volatility that marks this period makes it particularly difficult to provide completely reliable fore-
register that is continuously updated, combined with casting elements. However, despite the situation of uncertainty and instability, excellent execution of the Group’s ACCOUNTING STATEMENTS
the related analysis and risk impact assessment (DPIA); Online training sessions on the subject of Privacy are strategy in key markets will allow the corporate objectives to be achieved with the same resilience and constancy > Consolidated Statement of Financial Position
the operational flows for the exercise of the rights of planned. demonstrated in the recent pandemic period.
data subjects have been defined; audit activities have > Consolidated Statement of Profit or Loss
been carried out at third parties, suppliers of goods and > Consolidated Statement of Comprehensive Income

The Chairman of the Board of Directors
Alberto Lavazza
Tax Compliance - Tax Control Framework
An integrated compliance process has been launched The integrated transversal compliance path TCF-
in the tax field to identify and reduce tax, fraud and AEO-231 has provided for the mapping of all the busi- INDEPENDENT AUDITORS’ REPORT
customs risks. As part of this process, the Company ness operational processes with which tax risks are as-
has already obtained the status of Certified Customs sociated and the consequent definition of a Model for
Operator (Full AEO). the detection, measurement, management and con-
trol of tax risk (“Tax Control Framework – TCF”). The
On 24 March 2021, the Board of Directors of the Model’s governance has also been defined through the LUIGI LAVAZZA S.p.A.
Company approved the Lavazza Group’s Tax Strategy, identification of roles and responsibilities of the parties
which is inspired by the principles set out in the Code involved in managing the tax variable. Financial Statements
of Ethics and integrates the control measures provid-
ed for in the Organisational, Management and Control Appropriate training programmes will be provided to
at 31 December 2021
Model adopted pursuant to Legislative Decree No. 231 facilitate the development and dissemination at all lev- ACCOUNTING STATEMENTS
of 8 June 2001, where applicable. The Tax Strategy en- els of a tax risk culture.
shrines the sensitivity that the Lavazza Group has re- > Balance Sheet
garding responsible management of the tax variable > Statement of Profit or Loss
based on trust, transparency and collaboration with
institutions. It also represents the Group’s commitment
to consolidate and integrate tax risk management into
the organisation and processes through the identifica-
tion of suitable tools. NOTES TO THE FINANCIAL STATEMENTS

54 55 PRINT PDF
LAVAZZA GROUP - ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINACIAL STATEMENTS
LAVAZZA GROUP
Consolidated
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
at 31 December 2021 LAVAZZA GROUP

at 31 December 2021


at 31 December 2021
> Balance Sheet


56 57 PRINT PDF
LAVAZZA GROUP - ANNUAL REPORT 2021 LAVAZZA GROUP - CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2021
Accounting Statements
COMPANY OFFICERS
GROUP STRUCTURE
Consolidated Statement of Financial Position Consolidated Statement of Profit or Loss ON OPERATIONS
€ thousand NOTE 31.12.2021 31.12.2020 € thousand NOTE YEAR 2021 YEAR 2020 LAVAZZA GROUP
Goodwill 10.1 957,176 917,899
Net revenues 11.1 2,308,393 2,085,258
Other intangible assets 10.2 448,773 446,268
at 31 December 2021
Cost of sales 11.2 (1,385,765) (1,264,881)
Right of use 10.3 167,700 169,600
GROSS PROFIT 922,628 820,377
Property, plant and equipment 10.4 600,734 586,002
Promotional and advertising costs 11.3 (229,992) (185,251)
Investments in other companies 10.5 58,320 24,134
Selling costs 11.4 (183,253) (177,945)
Non-current financial assets 10.6 33,838 46,007 General and administrative expenses 11.5 (292,587) (275,858)
Deferred tax assets 10.7 74,033 78,832 ACCOUNTING STATEMENTS
Research and development costs 11.6 (15,787) (15,041)
Other non-current assets 10.8 4,056 4,298 Other operating income (expense) 11.7 (31,736) (44,073) > Consolidated Statement of Financial Position
Total non-current assets 2,344,630 2,273,040 OPERATING PROFIT 169,273 122,209
Inventories 10.9 445,921 404,713 Non-recurring income (expense) 11.7 - (13,549)
Trade receivables 10.10 259,547 243,115 Income (losses) for investments in JVs and associates 11.7 (5,690) (948) > Consolidated Statement of Comprehensive Income
Current tax receivables 10.11 4,926 4,711 PROFIT BEFORE THE FINANCIAL COMPONENT AND TAXES 163,583 107,712
Financial income (expense) 11.9 171 (18,734)
Other current assets 10.8 71,894 88,297
Current financial assets 10.6 378,018 392,712 Dividends and results from investments 11.9 237 107 > Consolidated Statement of Changes in Equity
Cash and cash equivalents 10.12 706,562 371,824 PROFIT BEFORE TAXES 163,991 89,085
Income taxes for the year 11.10 (58,463) (16,207)
Total current assets 1,866,868 1,505,372
PROFIT (LOSS) FROM CONTINUING OPERATIONS 105,528 72,878
Assets held for sale 6,247 8,397
Profit/(loss) from discontinued operations - - NOTES TO THE CONSOLIDATED
TOTAL ASSETS 4,217,745 3,786,809
PROFIT (LOSS) FOR THE YEAR 105,528 72,878 FINANCIAL STATEMENTS
PROFIT (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTERESTS 403 532
Share capital 10.13 25,000 25,000
PROFIT (LOSS) ATTRIBUTABLE TO THE GROUP 105,125 72,346 INDEPENDENT AUDITORS’ REPORT
Reserves 10.13 2,400,275 2,249,645
Profit for the year 105,125 72,346
Equity attributable to the Group 2,530,400 2,346,991
Equity attributable to non-controlling interests 10.13 3,191 2,738
Profit (loss) for the year attributable to non-controlling interests 403 532 LUIGI LAVAZZA S.p.A.
TOTAL EQUITY 2,533,994 2,350,261
Non-current financial liabilities 10.14 489,650 345,630 Financial Statements
Right-of-use liabilities, non current
Provisions for employee benefits
10.15
10.16
125,478
85,942
127,841
89,753
at 31 December 2021
Provisions for future risks and charges 10.17 126,948 94,311
Deferred tax liabilities 10.7 81,431 60,229
Other non-current liabilities 10.20 1,310 2,034 > Balance Sheet
Total non-current liabilities 910,759 719,798 > Statement of Profit or Loss
Current financial liabilities 10.14 201,032 216,230
Right-of-use liabilities, current 10.15 17,486 17,057 > Statement of Cash Flows
Trade payables 10.19 412,932 329,279
Provisions (current portion) 10.17 33,561 28,022
Current tax payables 10.18 14,517 15,273 NOTES TO THE FINANCIAL STATEMENTS
Other current liabilities 10.20 93,464 110,889
Total current liabilities 772,992 716,750 STATUTORY AUDITORS’ REPORT
TOTAL LIABILITIES 4,217,745 3,786,809

58 59 PRINT PDF
Consolidated Statement of Comprehensive Income Consolidated Statement of Cash Flows

COMPANY OFFICERS
€ thousand YEAR 2021 YEAR 2020 € thousand 2021 2020
GROUP STRUCTURE
NET PROFIT 105,528 72,878
PROFIT (LOSS) FOR THE YEAR 105,528 72,878 LETTER TO SHAREHOLDERS
Other components of comprehensive income that will be subsequently reclassified to profit / loss Income taxes 58,463 16,207
for the year (net of taxes): Financial expense/(income) 4,468 12,328 DIRECTORS’ SINGLE REPORT
Translation differences of foreign financial statements 52,481 (49,620) Value adjustments to financial assets/liabilities (1,095) 1,937 ON OPERATIONS
(Loss)/gain from hedging derivatives (cash flow hedge) 47,104 (11,048)
RESULT BEFORE TAXES, INTEREST AND ADJUSTMENTS TO FINANCIAL ASSETS 167,364 103,350
(Loss)/gain from securities 6,655 (3,774)
LAVAZZA GROUP
(Gains) losses from disposal of assets (759) (316)
Other components of comprehensive income that will be subsequently reclassified to
106,240 (64,442) Additions to provisions, employee benefits and other non-monetary components 91,421 64,709
profit/(loss) for the year, net of taxes
Other components of comprehensive income that will not be subsequently reclassified to profit /
Amortisation, depreciation and write-downs 151,019 151,885
at 31 December 2021
loss for the year (net of taxes): RESULT ADJUSTED FOR NON-MONETARY COMPONENTS 409,045 319,628
(Loss)/gain from revaluation of defined benefit plans 4,050 (2,317) Change in trade receivables (12,886) 59,647
Other components of comprehensive income that will not be subsequently reclassified to Change in inventories (35,863) (38,854)
4,050 (2,317)
profit/(loss) for the year, net of taxes Change in trade payables 80,309 (37,259)
TOTAL COMPONENTS OF OTHER COMPREHENSIVE INCOME, NET OF TAXES 110,290 (66,759)
Change in other receivables/payables (1,297) 4,174
TOTAL PROFIT/(LOSS) NET OF TAXES 215,818 6,119 CASH FLOW AFTER CHANGES IN NET WORKING CAPITAL 439,308 307,336 > Consolidated Statement of Financial Position
Attributable to: Taxes paid (54,150) (22,046) > Consolidated Statement of Profit or Loss
Equity holders of the Parent 215,196 5,762 Use of provisions and indemnities paid (40,354) (42,704) > Consolidated Statement of Comprehensive Income
Non-controlling interests 622 357 Interest and dividends collected, interest (paid) (7,549) (6,646)
CASH FLOWS FROM OPERATING ACTIVITIES 337,255 235,940
Purchases of property, plant and equipment (108,474) (90,451)
Purchases of intangible assets (26,203) (20,688)

Change in current financial assets 5,315 (179,052)
Change in non-current financial assets 7,705 6,017
Change in derivatives 60,870 (13,869)
Disposals (Acquisitions) of other equity investments (30,891) (19,933) INDEPENDENT AUDITORS’ REPORT
CASH FLOWS FROM INVESTING ACTIVITIES (91,678) (317,976)
New bank loans and payables
Net reimbursement of bank loans and payables 145,497 (122,424)
Net reimbursement of right-of-use liabilities (17,618) (16,869) LUIGI LAVAZZA S.p.A.
Dividends paid (33,376) (50,551)
CASH FLOWS FROM FINANCING ACTIVITIES 94,503 (189,844) Financial Statements
Changes in equity at 31 December 2021
Exchange rate effect (5,342) 6,557
CASH FLOWS GENERATED (USED) 334,738 (265,323)
> Balance Sheet
Cash and cash equivalents at year-start 371,824 637,147 > Statement of Profit or Loss
Cash and cash equivalents at year-end 706,562 371,824


60 61 PRINT PDF
Consolidated Statement of Changes in Equity

COMPANY OFFICERS
€ thousand GROUP STRUCTURE
MOVEMENTS IN EQUITY SHARE SHARE PREMIUM TREASURY OTHER RETAINED CASH FLOW RESERVE FOR RESERVE RESERVE FOR FTA EQUITY EQUITY TOTAL EQUITY
CAPITAL SHARES CAPITAL EARNINGS HEDGE ADJUSTMENTS FOR FVOCI TRANSLATION RESERVE ATTRIBUTABLE ATTRIBUTABLE TO
RESERVES RESERVE TO EMPLOYEE FINANCIAL DIFFERENCES TO THE GROUP NON-CONTROLLING
BENEFITS INSTRUMENTS INTERESTS ON OPERATIONS
Balance at 1 January 2021 25,000 224 (17,733) 636,143 1,675,624 (4,827) (7,218) 3,420 (47,017) 83,376 2,346,992 3,270 2,394,463
Profit for the year - - - - 105,125 - - - - - 105,125 403 105,528
Other components of comprehensive
- - - - - 47,065 4,049 6,655 52,304 - 110,073 219 110,292 LAVAZZA GROUP
income
Total comprehensive profit/(loss) for
the year
25,000 224 (17,733) 636,143 1,780,749 42,238 (3,169) 10,075 5,287 83,376 2,562,190 3,892 2,566,082 Consolidated Financial Statements
Option rights - - - - - - - - - - - - - at 31 December 2021
Payment of dividends - - - - (33,075) - - - - - (33,075) (301) (33,376)
Reclassifications - other movements - - - - 1,285 - - - - - 1,285 3 1,288
Balance at 31 December 2021 25,000 224 (17,733) 636,143 1,748,959 42,238 (3,169) 10,075 5,287 83,376 2,530,400 3,594 2,533,994

MOVEMENTS IN EQUITY SHARE SHARE PREMIUM TREASURY OTHER RETAINED CASH FLOW RESERVE FOR RESERVE RESERVE FOR FTA EQUITY EQUITY TOTAL
CAPITAL SHARES CAPITAL EARNINGS HEDGE ADJUSTMENTS FOR FVOCI TRANSLATION RESERVE ATTRIBUTABLE ATTRIBUTABLE TO EQUITY > Consolidated Statement of Comprehensive Income
RESERVES RESERVE TO EMPLOYEE FINANCIAL DIFFERENCES TO THE GROUP NON-CONTROLLING
BENEFITS INSTRUMENTS INTERESTS > Consolidated Statement of Cash Flows
Balance at 1 January 2020 25,000 224 (17,733) 628,235 1,661,125 6,221 (4,901) 7,194 2,427 83,376 2,391,168 3,295 2,394,463 > Consolidated Statement of Changes in Equity
Profit for the year - - - - 72,346 - - - - - 72,346 532 72,878
Other components of comprehensive
- - - - - (11,048) (2,317) (3,774) (49,444) - (66,583) (176) (66,759)
income
Total comprehensive profit/(loss) for NOTES TO THE CONSOLIDATED
25,000 224 (17,733) 628,235 1,733,471 (4,827) (7,218) 3,420 (47,017) 83,376 2,396,931 3,651 2,400,582
the year FINANCIAL STATEMENTS
Option rights - - - - - - - - - - - - -
Payment of dividends - - - - (50,175) - - - - - (50,175) (375) (50,550) INDEPENDENT AUDITORS’ REPORT
Reclassifications - other movements - - - 7,908 (7,672) - - - - - 236 (6) 230
Balance at 31 December 2020 25,000 224 (17,733) 636,143 1,675,624 (4,827) (7,218) 3,420 (47,017) 83,376 2,346,992 3,270 2,350,262

at 31 December 2021
> Balance Sheet


62 63 PRINT PDF
Notes to the COMPANY OFFICERS
Consolidated GROUP STRUCTURE

Financial
ON OPERATIONS
Statements LAVAZZA GROUP

at 31 December 2021


at 31 December 2021
> Balance Sheet


64 65 PRINT PDF
1. Company information
COMPANY OFFICERS
GROUP STRUCTURE
The publication of the Consolidated Financial
Statements of Luigi Lavazza S.p.A. (the Parent LETTER TO SHAREHOLDERS
Company) for the year ended 31 December 2021 has
been authorised by the Board of Directors on 28 March DIRECTORS’ SINGLE REPORT
2022. Luigi Lavazza S.p.A. is a company limited by ON OPERATIONS
shares registered and domiciled in Italy. The registered
office is in Turin, via Bologna 32.
Luigi Lavazza S.p.A. and its investee companies are LAVAZZA GROUP
directly and indirectly controlled by Finlav S.p.A.,
with registered office in Turin, Via Bologna 32. Consolidated Financial Statements
The Lavazza Group produces and distributes coffee in
Italy and internationally under its own brand and oth-
at 31 December 2021
er leading industry brands (Carte Noire, Merrild and
Kicking Horse Coffee).
The Lavazza Group’s Consolidated Financial Statements ACCOUNTING STATEMENTS
at and for the year ended 31 December 2021 have been > Consolidated Statement of Financial Position
prepared on a going-concern basis.


at 31 December 2021
> Balance Sheet


66 67 PRINT PDF
2. Accounting standards
COMPANY OFFICERS
GROUP STRUCTURE
2.1 Principles of preparation of the Consolidated Financial LETTER TO SHAREHOLDERS
Statements DIRECTORS’ SINGLE REPORT

A liability is classified as current when: ON OPERATIONS
The Group’s Consolidated Financial Statements at 31 December 2021 were prepared in accordance with the > it is expected to be settled in its normal operating cycle;
International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) LAVAZZA GROUP
and endorsed by the European Union. IFRS is also meant to include all revised international accounting standards > it is held primarily for the purpose of trading;
(IAS) and all the interpretations of the International Financial Reporting Interpretation Committee (IFRIC) previously Consolidated Financial Statements
known as Standing Interpretation Committee (SIC). > it is due to be settled within twelve months after the reporting period;
at 31 December 2021
The Consolidated Financial Statements have been prepared on a cost basis, taking account of impairment, where > the entity does not have an unconditional right to defer settlement of the liability for at least twelve months after
appropriate, with the exception of derivative financial instruments and new acquisitions, which have been accounted the reporting period.
for at their fair value, unless IFRS permit a different basis of measurement. ACCOUNTING STATEMENTS
The carrying amounts of assets and liabilities subject to fair value hedging transactions, which would otherwise be The Group classifies all other liabilities as non-current. > Consolidated Statement of Financial Position
measured at cost, have been adjusted to take account of the changes in fair value attributable to the hedged risk. Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The Consolidated Financial Statements have been presented in euro and all values have been rounded to thousands > Consolidated Statement of Comprehensive Income
of euro, unless otherwise indicated.
The financial statements of consolidated subsidiaries have been prepared in reference to the same reporting period, 2.3 Ongoing-concern basis > Consolidated Statement of Changes in Equity
adopt the same accounting principles as the Parent Company and have been included in the Consolidated Financial
Statements from the date on which the Group acquires control until the moment such control ceases to exist. Where
the Group loses control of a subsidiary, the Consolidated Financial Statements include the subsidiary’s performance The 2021 Consolidated Financial Statements have been prepared by treating the business as a going concern, inas- NOTES TO THE CONSOLIDATED
in proportion to the period in which the Group exercised control. much as it may reasonably be expected that the Lavazza Group will continue to operate for the foreseeable future
Any non-controlling interests in the equity and reserves of subsidiaries and non-controlling interests in the profit with a time horizon of over twelve months. For further details, reference should be made to the Directors’ Single
or loss for the year of consolidated subsidiaries are separately presented in the consolidated statement of financial Report on Operations. INDEPENDENT AUDITORS’ REPORT
position and consolidated statement of profit or loss.
2.2 Consolidated Accounting Statements LUIGI LAVAZZA S.p.A.

The statement of financial position presents a separate classification of assets and liabilities as “current/non-cur-
rent”. The statement of profit or loss classifies expenses by their function. The statement of cash flows has been pre-
at 31 December 2021
pared so as to represent cash flows from operating activities using the “indirect method”, in accordance with IAS 7. ACCOUNTING STATEMENTS
An asset is classified as current when:
> Balance Sheet
> it is expected to be realised or is held to sell or consume, in its normal operating cycle; > Statement of Profit or Loss

> it is held primarily for the purpose of trading;
> it is expected to be realised within twelve months after the reporting period;
> it is cash or a cash equivalent unless the asset is restricted from being exchanged or used to settle a liability for
at least twelve months after the reporting period.
All other assets are classified as non-current.

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3. Consolidation area The following table provides a detail of consolidated companies, associates and other minor investees.
and changes
COMPANY NAME REGISTERED SHARE % HELD % HELD % HELD
OFFICE CAPITAL DIRECTLY INDIRECTLY BY THE COMPANY OFFICERS
GROUP
PARENT COMPANY: GROUP STRUCTURE
Luigi Lavazza S.p.A. Turin EUR 25,000,000 - - -
COMPANIES CONSOLIDATED USING THE
LINE-BY-LINE METHOD: DIRECTORS’ SINGLE REPORT
Nims S.p.A. Padua EUR 3,000,000 97 - 100
The Consolidated Financial Statements include the financial statements at and for the ON OPERATIONS
Lavazza France S.a.s. Boulogne EUR 21,445,313 100 - 100
year ended 31 December 2021 of Luigi Lavazza S.p.A., the Parent Company, and the Carte Noire S.a.s. Boulogne EUR 103,830,406 100 - 100
subsidiaries for which Luigi Lavazza S.p.A. has the power to direct the relevant activi-
LAVAZZA GROUP
Carte Noire Operations S.a.s. Lavérune EUR 28,523,820 - 100 100
ties of the company and is exposed to the variability of their performance. Lavazza Kaffee G.m.b.H. Vienna EUR 218,019 100 - 100

Lavazza Deutschland G.m.b.H. Frankfurt EUR 210,000 100 - 100
The consolidation area at 31 December 2021 did not change compared with the pre- Lavazza Premium Coffees Corp. New York USD 38,849,367 93 - 93
vious year. Kicking Horse Coffee Co. Ltd Invermere CAD 214,994,203 80 - 80 at 31 December 2021
Lavazza Coffee (UK) Ltd Uxbridge GBP 1,000 100 - 100
It should be noted that Caffemotive S.r.l. was merged into the parent company Luigi Lavazza Spain S.L. Barcelona EUR 1,090,620 100 - 100
Lavazza S.p.A. Lavazza Sweden AB Stockholm SEK 100,000 100 - 100
Caffemotive was acquired and included in the consolidation area at the end of 2020, Lavazza do Brasil Ltda Rio de Janeiro BRL 77,097,753 100 - 100 ACCOUNTING STATEMENTS
and was then merged in the Parent Company effective 1 January 2021. This transac- Cofincaf S.p.A. Turin EUR 3,000,000 99 - 99 > Consolidated Statement of Financial Position
tion did not generate material impacts on the Group, except for certain reclassifica- Lavazza Netherlands B.V. Amsterdam EUR 111,500,000 100 - 100
tions to intangible assets aimed at reallocating the consolidation difference originally Fresh & Honest Café Ltd Chennai INR 91,304,920 - 100 100 > Consolidated Statement of Profit or Loss
classified as industrial rights and patents. Lavazza Argentina S.A. Buenos Aires ARS 39,750,932 98 2 100 > Consolidated Statement of Comprehensive Income
Lavazza Australia Pty Ltd Hawthorn AUD 7,310,600 100 - 100
Lavazza Capital S.r.l. Turin EUR 200,000 100 - 100
Merrild Kaffe ApS Middelfart DKK 50,000 100 - 100 > Consolidated Statement of Changes in Equity
Merrild Baltics SIA Line EUR 2,828 - 100 100
Lavazza Professional France S.a.s. Roissy en France EUR 279,706 - 100 100
Wilmington,
Lavazza Professional North America LLC USD n.a. - 100 100 NOTES TO THE CONSOLIDATED
Delaware
Wilmington, FINANCIAL STATEMENTS
Lavazza Professional Holding North America Inc. USD 1 100 - 100
Delaware
Lavazza Professional (UK) Limited Basingstoke GBP 34,084,001 - 100 100
Lavazza Professional (UK) Operating Services Limited Basingstoke GBP 2,630,000 - 100 100
Lavazza Professional Germany G.m.b.H. Verden EUR 50,000 - 100 100
Lavazza Japan GK Tokyo JPY 1,000 - 100 100
Lavazza Australia OCS Pty Ltd
Lavazza Professional Holding EU S.r.l.
Mulgrave
Turin
AUD
EUR
3,000,000
1,000,000
-
100
100
-
100
100
COMPANIES CONSOLIDATED USING THE
EQUITY METHOD:
Y&L Coffee Ltd Hong Kong USD 120,000,000 35 - 35 at 31 December 2021
La Manufacture de Café Alain Ducasse S.a.s. Paris EUR 10,000 50 - 50
OTHER INVESTMENTS ACCOUNTING STATEMENTS
Lavazza Maroc S.a.r.l. Casablanca MAD 10,000 100 - 100
> Balance Sheet
Lavazza Trading (Shenzhen) Co. Ltd Shenzhen CNY 8,201,500 100 - 100
International Coffee Partners G.m.b.H. Hamburg EUR 175,000 20 - 20 > Statement of Profit or Loss
INVESTMENTS VALUED AT FAIR VALUE: > Statement of Cash Flows
INV. A.G. S.r.l. Milan EUR 207,637,307 11 - 11
Clubitaly S.p.A. Milan EUR 6,164,300 - 6 6
Connect Ventures One LP London GBP n.a. 3 - 3
Casa del Commercio e Turismo S.p.A. Turin EUR 114,700 3 - 3
Air Vallée S.p.A. St. Christopher EUR 6,000,000 2 - 2 STATUTORY AUDITORS’ REPORT
Tamburi Investment Partners S.p.A. Milan EUR 95,877,237 - 0.3 0.3
Immobilière 3F (previously Le Foyer du Fonctionnaire) Paris EUR 46,552,000 n.a. - n.a. INDEPENDENT AUDITORS’ REPORT
Idroelettrica S.c.r.l. Aosta EUR 50,000 0.1 - 0.1
Solar Investment Group B.V. Milan EUR 4,738,042 - 1 1
70 71 PRINT PDF
4. Consolidation criteria
COMPANY OFFICERS
GROUP STRUCTURE
The Consolidated Financial Statements include the financial statements of Luigi Lavazza S.p.A. and its subsidiaries Changes in the percent interest in a subsidiary that do not entail a loss of control are accounted for using the equity
at 31 December 2021. Control is achieved when the Group is exposed or entitled to variable returns arising from its method. LETTER TO SHAREHOLDERS
relationship with the investee entity, together with the ability to influence such returns by exercising its power over The Consolidated Financial Statements are presented in euro, the functional and presentation currency adopted by
the said entity. the Parent Company. Each Group entity determines its own functional currency, which is used to measure the items DIRECTORS’ SINGLE REPORT
Specifically, the Group controls an investee if it has all the following: included in the individual financial statements. The Group adopts the direct consolidation method. The amount that ON OPERATIONS
arises from the use of this method is represented by the gain or loss reclassified to the statement of profit or loss
> power over the investee, that is to say the ability to direct the relevant activities of the investee, i.e., the activities when a foreign subsidiary is disposed of.
that significantly affect the investee’s returns; LAVAZZA GROUP
> rights to variable returns (positive or negative) from its involvement with the investee; The exchange rates used for translating financial statements denominated in currencies other than the Euro are as Consolidated Financial Statements
> the ability to use its power over the investee to affect the amount of the investor’s returns.
follows:
at 31 December 2021
2021 2020
Currency AVERAGE EXCHANGE YEAR-END AVERAGE EXCHANGE YEAR-END

In general, the majority of voting rights is deemed to entail controls over the investee. In support of this presump- RATE RATE
tion, and when the Group holds less than the majority of voting rights (or similar rights), the Group considers all ACCOUNTING STATEMENTS
Argentine Peso (*) 116.36 116.36 103.25 103.25
relevant facts and circumstances to determine whether it controls the investee, including: > Consolidated Statement of Financial Position
Australian Dollar 1.57 1.56 1.66 1.59
Brazilian Real 6.38 6.31 5.89 6.37 > Consolidated Statement of Profit or Loss
> contractual agreements with other vote-holders;
Canadian Dollar 1.48 1.44 1.53 1.56
Danish Krone 7.44 7.44 7.45 7.44 > Consolidated Statement of Comprehensive Income
> rights under contractual agreements;
Pound Sterling 0.89 0.84 0.89 0.90 > Consolidated Statement of Cash Flows
Indian Rupee 87.44 84.23 84.63 89.66
> voting rights and potential voting rights of the Group. > Consolidated Statement of Changes in Equity
Japanese Yen 129.88 130.38 121.83 126.49
Swedish Krona 10.15 10.25 10.49 10.03
Consolidation of an investee begins from the date the Group obtains control of the investee and ceases when the US Dollar 1.18 1.13 1.14 1.23
Group loses control of the investee. Assets, liabilities, revenues and costs of the subsidiary acquired or disposed of NOTES TO THE CONSOLIDATED
during the year are included in the Consolidated Financial Statements from the date the Group obtains control until (*): Company in hyperinflation; average exchange rate, identical to the year-end exchange rate has been applied, pursuant to IAS 29
the date the Group no longer has control over the subsidiary.
All subsidiaries are consolidated using the line-by-line method. According to this method, the consolidated entities’ INDEPENDENT AUDITORS’ REPORT
assets, liabilities, income and expenses are incorporated into the consolidated financial statements line by line. The
carrying amount of the equity investments is derecognised together with the corresponding share of the investees’
equity, attributing each asset and liability its current value at the date of acquisition of control. Any residual differ-
ence, where positive, is taken to goodwill; where negative, it is recognised through profit or loss.
When preparing the Consolidated Financial Statements, all elements of assets and liabilities, income and expens- LUIGI LAVAZZA S.p.A.
es and cash flows between Group entities are eliminated, along with unrealised gains and losses on intra-Group
transactions. Financial Statements
All assets and liabilities of foreign entities in currencies other than the euro that fall within the scope of consolida-
tion are translated at the spot exchange rates at the reporting date (current exchange rate method), whereas the
at 31 December 2021
related revenues and costs are translated at the average exchange rates for the year. Exchange differences on the ACCOUNTING STATEMENTS
translation of foreign operations arising from this method are classified in Equity.
The profit (loss) for the year and all other components of other comprehensive income are attributed to the share- > Balance Sheet
holders of the parent company and non-controlling interests, even if this entails that minority interests have a neg- > Statement of Profit or Loss
ative balance. Where necessary, the financial statements of the subsidiaries are adjusted as appropriate in order to
ensure compliance with the Group’s accounting policies. All intra-Group assets and liabilities, equity, revenues, costs
and cash flows relating to transactions between Group entities are fully eliminated during the consolidated process.


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5. Main principles used for the Fair value measurement

preparation of the Financial Statements The Group measures financial instruments such as de- The fair value measurement is wholly classified in the
COMPANY OFFICERS
GROUP STRUCTURE
rivatives and non-financial assets such as investment same fair value hierarchy level in which the lowest lev-
properties, at fair value at each balance sheet date. el input used for measurement is classified. LETTER TO SHAREHOLDERS
Fair value is the price that would be received to sell an For assets and liabilities that are recognised in the fi-
asset or paid to transfer a liability in an orderly trans- nancial statements at fair value on a recurring basis, DIRECTORS’ SINGLE REPORT
ON OPERATIONS
Business combinations and goodwill
action between market participants at the measure- the Group determines whether transfers have occurred
ment date. The fair value measurement is based on the between levels in the hierarchy by re-assessing catego-
presumption that the transaction to sell the asset or risation (based on the lowest level input that is signifi-
transfer the liability takes place either: cant to the fair value measurement as a whole) at the LAVAZZA GROUP
Business combinations are recognised in accordance sets acquired exceeds the consideration, the difference end of each reporting period.
with IFRS 3, using the acquisition method. The cost of (gain) is taken to the statement of profit or loss. Any > in the principal market for the asset or liability The Group determines the policies and procedures Consolidated Financial Statements
an acquisition is determined as the sum of the consid-
eration transferred, measured at its acquisition date
ancillary costs related to the business combination are
recognised through profit or loss.
or for both recurring fair value measurement, such as
investment properties and unquoted financial assets,
at 31 December 2021
fair value, and the amount of the minority interest in > in the absence of a principal market, in the most ad- and for non-recurring measurement, such as assets
the acquiree. For each business combination, the Group After initial recognition, goodwill is not amortised, vantageous market for the asset or liability. held for sale in discontinued operations. The Group is
determines whether to measure the minority interest but measured at cost, net of cumulative impairment comprised of the heads of properties, acquisitions and ACCOUNTING STATEMENTS
in the acquiree at fair value or in proportion to the mi- losses. For impairment-testing purposes, the goodwill The principal or the most advantageous market must mergers, the head of risk management, chief finance > Consolidated Statement of Financial Position
nority interest share of the acquiree’s identifiable net acquired in a business combination is allocated at the be accessible by the Group. officers and the managers of each manufacturing unit.
assets. Acquisition costs are expensed during the year acquisition date to each cash-generating unit of the The fair value of an asset or a liability is measured us- At each reporting date, the Group analyses the move- > Consolidated Statement of Profit or Loss
and classified as administrative expenses. Group that is expected to benefit from the synergies of ing the assumptions that market participants would ments in the values of assets and liabilities which are > Consolidated Statement of Comprehensive Income
When the Group acquires a business, it classifies or the combination, regardless of whether other assets use when pricing the asset or liability, assuming that required to be remeasured or re-assessed as per the
designates the financial assets acquired or the liabili- or liabilities of the acquiree are assigned to the units market participants act in their economic best interest. Group’s accounting policies.
ties assumed in accordance with the contractual terms, concerned. A fair value measurement of a non-financial asset takes For this analysis, the Group verifies the major inputs > Consolidated Statement of Changes in Equity
economic conditions and other relevant conditions in If goodwill has been allocated to a cash-generating into account a market participant’s ability to generate applied in the latest valuation by agreeing the infor-
effect at the acquisition date. unit, and the entity disposes of part of the unit’s as- economic benefits by using the asset in its highest and mation in the valuation computation to contracts and
Any contingent consideration to be paid is recognised sets, the goodwill associated with the asset disposed of best use or by selling it to another market participant other relevant documents. NOTES TO THE CONSOLIDATED
by the acquirer at its acquisition date fair value. is included in the carrying amount of the asset when that would use the asset in its highest and best use. The Group, in conjunction with the Group’s external
Goodwill is initially recognised at cost, represented determining the gain or loss on disposal. The goodwill The Group uses valuation techniques that are appro- appraisers, compares the change in the fair value of
by the amount by which the sum of the consideration associated with the asset disposed of is determined on priate in the circumstances in question and for which each asset and liability with relevant external sources INDEPENDENT AUDITORS’ REPORT
paid and amount recognised for minority interests ex- the basis of the values of the asset disposed of and the sufficient data are available to measure fair value, to determine whether the change is reasonable. The
ceeds the identifiable net assets acquired and liabilities retained portion of the cash-generating unit. maximising the use of relevant observable inputs and valuation results are shared with the Group’s Statutory
assumed by the Group. If the fair value of the net as- minimising the use of unobservable inputs. Auditors and Independent Auditors. The presentation
All assets and liabilities for which fair value is meas- includes a discussion of the major assumptions used in
ured or disclosed in the Financial Statements are cat- the valuations. LUIGI LAVAZZA S.p.A.
egorised within the fair value hierarchy, described as For the purpose of fair value disclosures, the Group has
follows: determined classes of assets and liabilities on the ba- Financial Statements
Investments in associates and joint ventures sis of the nature, characteristics and risks of the asset
at 31 December 2021
> level 1 — quoted (unadjusted) market prices in ac- or liability and the level of the fair value hierarchy, as
tive markets for identical assets or liabilities, which explained above. ACCOUNTING STATEMENTS
An associate is an entity over which the Group has Following the application of the equity method, the the entity can access at measurement date; Fair-value related disclosures for financial instruments
significant influence. Significant influence means the Group assesses whether it is necessary to recognise and assets and liabilities valued at fair value are sum- > Balance Sheet
power to participate in the financial and operating pol- any impairment of its equity interest as the difference > level 2 — input other than quoted prices included in marised in paragraph 10.22 of these Notes. > Statement of Profit or Loss
icy decisions but not to control them. between the recoverable amount and carrying amount level 1, directly or indirectly observable for the asset
A joint venture is a joint arrangement whereby the par- of the said equity interest. or liability;
ties that have joint control of the arrangement have When the Group ceases to have a significant influence
rights to the net assets of the arrangement. over the associate, it measures and recognises the re- > level 3 — valuation techniques for which the input
The Group’s investments in associates and joint ven- maining investment at fair value. The difference be- data are unobservable for the asset or liability. NOTES TO THE FINANCIAL STATEMENTS
tures are measured using the equity method. tween the carrying value of the investment at the date
Their goodwill is included in the accounting value of significant influence or joint control cease and the fair
the investment and is not subject to a separate impair- value of the remaining investment and the considera- INDEPENDENT AUDITORS’ REPORT
ment test. tion received is recognised through profit or loss.

74 75 PRINT PDF
Other intangible assets Property, plant and equipment

COMPANY OFFICERS
The intangible assets acquired are recognised in ac- Research and development costs Property, plant and equipment are carried at historical cost, less accumulated depreciation and any accumulated
GROUP STRUCTURE
cordance with IAS 38 – Intangible Assets where the impairment losses. Land is recognised at historical cost less any impairment losses. Such cost includes the cost, as
use of the assets is likely to give rise to future econom- Research and development costs are fully charged to incurred, of replacing part of the plant and equipment if the recognition criteria are met. LETTER TO SHAREHOLDERS
ic benefits and the cost of the asset may be reliably the statement of profit or loss for the financial year in Costs incurred after purchase are only capitalised if they increase the future economic benefits that may be derived
determined. which they are incurred. Development costs borne for from the use of the asset. The costs of replacing identifiable components of complex assets are capitalised and de- DIRECTORS’ SINGLE REPORT
Intangible assets acquired separately are measured on a specific project are recognised as intangible assets preciated over their useful lives; the residual carrying amount of the replaced component is taken to the statement ON OPERATIONS
initial recognition at cost. The cost of intangible assets when the Group can demonstrate: of profit or loss. Other costs are recognised in profit or loss as incurred.
acquired in a business combination is their fair value at Financial expenses incurred in respect of investments in assets for which a certain period of time is normally re-
the date of acquisition. Following initial recognition, in- > the technical feasibility of completing the intangible quired before the asset is ready for use or sale (qualifying assets pursuant to IAS 23 – Borrowing Costs) are capi- LAVAZZA GROUP
tangible assets are carried at cost less any accumulat- asset so that it will be available for use or sale; talised and depreciated over the useful life of the class of assets to which they refer. All other borrowing costs are
ed amortisation and accumulated impairment losses. recognised in profit or loss as incurred. Consolidated Financial Statements
Internally generated intangibles, excluding capitalised
development costs, are not capitalised and the related
> the intention to complete and use or sell the asset; Ordinary maintenance and repair costs are recognised in the statement of profit or loss of the financial year in which
they are incurred.
at 31 December 2021
expenditure is reflected in profit or loss in the period in > how the intangible asset will generate future eco- Depreciation is calculated on a straight-line basis over the estimated useful lives of the individual assets, based on
which the expenditure is incurred. nomic benefits; the Group’s usage plans, which also take into account the estimated physical wear and tear and technological obso-
lescence of the asset, as well as the presumable expected realisable value, net of disposal costs. ACCOUNTING STATEMENTS
The useful lives of intangible assets are assessed as ei- > the availability of resources to complete the Where an item of property, plant and equipment consists of multiple significant components with different useful > Consolidated Statement of Financial Position
ther finite or indefinite. development; lives, depreciation is applied to each component.
Intangible assets with finite lives are amortised over The value to be depreciated is represented by the carrying amount, less the presumed net disposal value at the end > Consolidated Statement of Profit or Loss
the useful economic life and assessed for impairment > its ability to measure reliably the expenditure attrib- of its useful life, where material and reasonably determinable. > Consolidated Statement of Comprehensive Income
whenever there is an indication that the intangible as- utable to the intangible asset during its development. Land is not depreciated, even where purchased together with a building, nor are items of property, plant and equip-
set may be impaired. Amortisation rates are controlled ment held for sale, which are measured at the lesser of their initial recognition amount and fair value, net of costs
every year and the changes are recognised through After initial recognition, development costs are car- to sell. > Consolidated Statement of Changes in Equity
profit or loss. ried at cost less any accumulated amortisation and
Intangible assets with indefinite useful lives are not impairment losses. Amortisation of the asset begins The following depreciation rates are used:
amortised, but are tested for impairment annually, ei- when development is complete and the asset is availa- NOTES TO THE CONSOLIDATED
ther individually or at the cash-generating unit level. ble for use. Development is amortised over the period Buildings 60 years
Buildings not used for business 80 years FINANCIAL STATEMENTS
Any gain or loss arising upon derecognition of an in- of expected future benefit and amortisation rates are
Plant and machinery 10-30 years
tangible asset (calculated as the difference between the recorded in cost of sales. During the period of develop- INDEPENDENT AUDITORS’ REPORT
net disposal proceeds and the carrying amount of the ment, the asset is tested for impairment annually. Industrial equipment and moulds 3-10 years
intangible asset) is included in the statement of profit Espresso machines and other commercial equipment 3-7 years
or loss for the year when the asset is derecognised. Furniture and fittings 8 years
Means of transport 8-12 years
Electronic machinery 5 years LUIGI LAVAZZA S.p.A.
Patents and licences Financial Statements
The costs of patent rights, concession rights, licences and other intangible assets are recognised as assets only if The carrying amount of an item of property, plant and equipment, and all initially recognised significant com-
at 31 December 2021
they are capable of generating future economic benefits for the company. Such costs are amortised according to ponents are derecognised when they are disposed of or no future economic benefit is expected from their use or ACCOUNTING STATEMENTS
their useful lives, where finite, or on the basis of their contractual term. Software licences refer to the purchase cost sale. The gain or loss that arises upon the derecognition of an asset (calculated as the difference between the car-
of the licences and any external or internal personnel consultancy costs required for development. They are ex- rying amount of the asset and the net consideration) is taken to the statement of profit or loss when the asset is > Balance Sheet
pensed during the year in which the internal or external costs relating to training of personnel and any other related derecognised. > Statement of Profit or Loss
costs are incurred. The residual values, useful lives and depreciation methods for property, plant and equipment are revised at each
reporting date and, where appropriate, adjusted prospectively.
The following table provides a summary of the amortisation rates applied to the Group’s intangible assets:
Capitalised research costs 3-7 years NOTES TO THE FINANCIAL STATEMENTS

Rights for industrial patents and rights for exploitation of
3-5 years
intellectual property STATUTORY AUDITORS’ REPORT
Licences and similar rights 5 years
Other 3-5 years

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Rights of use of third-party assets Financial assets

COMPANY OFFICERS
The determination of whether an arrangement is (or contains) a lease is based on the Initial recognition and measurement GROUP STRUCTURE
substance of the arrangement and requires and assessment of whether fulfilment of
the arrangement is dependent on the use of a specific asset (or specific assets) and the At initial recognition, financial assets are classified, on a case-by-case basis, at amortised cost, fair value through LETTER TO SHAREHOLDERS
arrangement conveys a right to use the asset (or assets). Such assessment is carried other comprehensive income (OCI), and fair value through profit or loss.
out on inception of the lease. Under IFRS 16, lease contracts are accounted for by The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow DIRECTORS’ SINGLE REPORT
recognising in the statement of financial position a lease liability of a financial nature characteristics and the Group’s business model for managing them. With the exception of trade receivables, the ON OPERATIONS
representing the present value of future lease payments and recognising under assets Group initially measures a financial asset at its fair value plus transaction costs, in the case of a financial asset not at
the right of use of the leased asset. At the commencement date, the right of use is fair value through profit or loss. Trade receivables that do not contain a significant financing component or for which
recognised at cost and includes: the amount of the initial measurement of the lease the Group has applied the practical expedient are measured at the transaction price determined under IFRS 15. LAVAZZA GROUP
liability, any lease payments made at or before the commencement date, any initial A financial asset may be classified and measured at amortised cost or fair value through OCI, if it generates cash
direct costs incurred to sign the contract and the present value of estimated costs to flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding. This assess- Consolidated Financial Statements
be incurred in dismantling the underlying asset or restoring the underlying asset to
the condition required by the terms and conditions of the lease, less any lease incen-
ment is referred to as the SPPI test and is performed at an instrument level.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order to
at 31 December 2021
tives received. Subsequently, the right of use is depreciated over the lease term (or the generate cash flows. The entity's business model determines whether cash flows will result from collecting contrac-
useful life of the asset if shorter), subject to any impairment losses and adjusted for tual cash flows, selling financial assets or both.
any remeasurement of the lease liability. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation ACCOUNTING STATEMENTS
or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group > Consolidated Statement of Financial Position
commits to purchase or sell the asset.
Impairment Subsequent measurement > Consolidated Statement of Cash Flows

For purposes of subsequent measurement, financial assets are classified in four categories:
Assets with an indefinite useful life, which are not amortised, are tested for impair-
ment annually and whenever circumstances indicate that their carrying amount may > financial assets at amortised cost (debt instruments); NOTES TO THE CONSOLIDATED
be impaired, as defined by IAS 36.
Assets subject to depreciation are tested for impairment only in the event relevant > financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments);
impairment indicators are identified. INDEPENDENT AUDITORS’ REPORT
The recoverable amount of goodwill acquired and allocated during the year is as- > financial assets at fair value through OCI with no recycling of cumulative gains and losses upon derecognition
sessed at the end of the period in which the acquisition and allocation occurred. (equity instruments);
For the purposes of determining its recoverable amount, goodwill is allocated, at the
acquisition date, to a CGU (or group of CGUs) benefiting from the acquisition. > financial assets at fair value through profit or loss.
Potential impairment exists when the carrying value of an asset or cash generating LUIGI LAVAZZA S.p.A.
unit exceeds its recoverable amount, which is the higher of its price of sale less costs FINANCIAL ASSETS AT AMORTISED COST (DEBT INSTRUMENTS)
of disposal and its value in use, that is the present value of expected future cash flows, Financial Statements
net of taxes, by applying a discount rate that reflects current market assessments
of the time value of money and the risks specific to the asset. Impairment is initially
The Group measures financial assets at amortised cost if both of the following conditions are met:
at 31 December 2021
accounted for by reducing the carrying amount of the goodwill allocated to the CGU > The financial asset is held within a business model with the objective to hold financial assets in order to collect ACCOUNTING STATEMENTS
(or group of CGUs) and only subsequently to the other assets in the unit, in proportion contractual cash flows
to their carrying amount, up to the recoverable amount of assets with finite useful and > Balance Sheet
lives. An impairment loss is recognised if the carrying amount exceeds the recov- > Statement of Profit or Loss
erable amount. When an impairment of an asset other than goodwill subsequently > The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
ceases to exist or decreases, the carrying amount of the CGU is written up to the new principal and interest on the principal amount outstanding.
estimated recoverable amount. The reversal cannot exceed the carrying amount that
would have been determined had no impairment loss been recognised for the asset. Financial assets at amortised cost are subsequently measured using the effective interest method and are tested for
The reversal is immediately recognised in the statement of profit or loss. impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. NOTES TO THE FINANCIAL STATEMENTS
The Group’s financial assets at amortised cost includes trade receivables, a loan to an associate and a loan to a
director included under other non-current financial assets.

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FINANCIAL ASSETS AT FAIR VALUE THROUGH FINANCIAL ASSETS AT FAIR VALUE THROUGH Derecognition of a financial asset
OCI (DEBT INSTRUMENTS) PROFIT OR LOSS
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is
The Group measures debt instruments at fair value This category includes financial assets held for trad- primarily derecognised (i.e., removed from the Group’s consolidated statement of financial position) when: COMPANY OFFICERS
through OCI if both of the following conditions are met: ing, financial assets designated upon initial recognition
GROUP STRUCTURE
at fair value through profit or loss, or financial assets > The rights to receive cash flows from the asset have expired
> The financial asset is held within a business model required to be measured at fair value. Financial assets or LETTER TO SHAREHOLDERS
whose objective is achieved by both collecting con- are classified as held for trading if they are acquired for
tractual cash flows and selling financial assets the purpose of selling or repurchasing in the near term. > The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the DIRECTORS’ SINGLE REPORT
and Derivatives, including separated embedded derivatives, received cash flows in full without delay to a third party, and either (a) the Group has transferred substantially all ON OPERATIONS
are also classified as held for trading unless they are the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks
> The contractual terms of the financial asset give designated as effective hedging instruments. Financial and rewards of the asset, but has transferred control of the asset.
rise on specified dates to cash flows that are solely assets with cash flows that are not solely payments LAVAZZA GROUP
payments of principal and interest on the principal of principal and interest are classified and measured When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through
amount outstanding. at fair value through profit or loss, irrespective of the arrangement whereby it retains the contractual rights to receive the cash flows of the financial asset, but assumes Consolidated Financial Statements
For debt instruments at fair value through OCI, interest
business model. Notwithstanding the criteria for debt
instruments to be classified at amortised cost or at fair
a contractual obligation to pay the cash flows to one or more recipients, it evaluates if, and to what extent, it has
retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the
at 31 December 2021
income, foreign exchange revaluation and impairment value through OCI, as described above, debt instru- risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the transferred
losses or reversals are recognised in the statement of ments may be designated at fair value through profit asset to the extent of its continuing involvement. In that case, the Group also recognises an associated liability. The
profit or loss and computed in the same manner as for or loss on initial recognition if doing so eliminates, or transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that ACCOUNTING STATEMENTS
financial assets measured at amortised cost. The re- significantly reduces, an accounting mismatch. the Group has retained. > Consolidated Statement of Financial Position
maining fair value changes are recognised in OCI. Upon Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the orig-
derecognition, the cumulative fair value change recog- Financial assets at fair value through profit or loss are inal carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay. > Consolidated Statement of Profit or Loss
nised in OCI is recycled to profit or loss. carried in the statement of financial position at fair val- > Consolidated Statement of Comprehensive Income
The Group’s debt instruments at fair value through OCI ue with net changes in fair value recognised in profit
includes investments in quoted debt instruments in- or loss. Impairment of financial assets > Consolidated Statement of Cash Flows
cluded under other non-current financial assets. This category includes derivative instruments and > Consolidated Statement of Changes in Equity
Upon initial recognition, the Group can elect to clas- listed equity investments which the Group had not ir- The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value
sify irrevocably its equity investments as equity in- revocably elected to classify at fair value through OCI. through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with
struments designated at fair value through OCI when Dividends on listed equity investments are also recog- the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original NOTES TO THE CONSOLIDATED
they meet the definition of equity instruments under nised as other income in the statement of profit or loss effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit
IFRS 9 – Financial Instruments: Presentation and are when the right of payment has been established. enhancements that are integral to the contractual terms.
not held for trading. The classification is determined on A derivative embedded in a non-derivative hybrid con- A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. INDEPENDENT AUDITORS’ REPORT
an instrument-by-instrument basis. tract, with a financial liability or non-financial host, is With regard to trade receivables and contract assets, the Group applies a simplified approach for calculating ECLs.
Gains and losses on these financial assets are never separated from the host and accounted for as a sepa- Therefore, instead of recognising the changes in credit risk, the Group recognises a write-down provision based on
recycled to profit or loss. Dividends are recognised as rate derivative if: the economic characteristics and risks ECLs outstanding at each reporting date.
other income in the statement of profit or loss when are not closely related to the host; a separate instru- The provision consists of a specific and a generic component. The specific component is determined based on the
the right of payment has been established, except when ment with the same terms as the embedded derivative following rules: LUIGI LAVAZZA S.p.A.
the Group benefits from such proceeds as a recovery would meet the definition of a derivative; and the hybrid
of part of the cost of the financial asset, in which case, contract is not measured at fair value through profit or > bad and doubtful debts: write-down of 100%; Financial Statements
such gains are recognised in other comprehensive
income. Equity instruments designated at fair value
loss. Embedded derivatives are measured at fair value
with changes in fair value recognised in profit or loss. > past-due by more than 365 days: write-down of 100%;
at 31 December 2021
through OCI are not tested for impairment. Reassessment only occurs if there is either a change ACCOUNTING STATEMENTS
in the terms of the contract that significantly modifies > all FS clients with debts past-due by more than 180 days: write-down of 100%;
the cash flows that would otherwise be required or a > Balance Sheet
reclassification of a financial asset out of the fair value > all FS clients with mixed positions: write-down of 50% of debts past-due by more than 180 days; > Statement of Profit or Loss
through profit or loss category.
A derivative embedded within a hybrid contract con- > all past-due debts by more than 90 days not included in the previous categories: write-down of 25%;
taining a financial asset host is not accounted for
separately. The financial asset host together with the > coffee Shop miscellaneous and past-due debts: ad-hoc write-down;
embedded derivative is required to be classified in its NOTES TO THE FINANCIAL STATEMENTS
entirety as a financial asset at fair value through profit > debts as indicated by the Credit Manager: ad-hoc write-down.
or loss.
The generic component that does not fall in the above-mentioned categories is determined based on trade receiv- INDEPENDENT AUDITORS’ REPORT
ables, excluding intercompany balances. With regard to these exposures, the outstanding ECL is calculated on the
basis of historical data.
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Financial liabilities Derivatives

COMPANY OFFICERS
Initial recognition and measurement Initial recognition and subsequent measurement GROUP STRUCTURE
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, The Group uses derivative financial instruments, such as forward currency contracts, LETTER TO SHAREHOLDERS
loans and borrowings, payables, or as derivatives designated as hedging instruments. interest rate swaps and forward commodity contracts, to hedge its foreign currency
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, risks, interest rate risks and commodity price risks, respectively. Such derivative DIRECTORS’ SINGLE REPORT
including directly attributable transaction costs. financial instruments are initially recognised at fair value on the date on which the ON OPERATIONS
The Group’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, derivative contract is entered into and are subsequently remeasured at fair value.
and derivative financial instruments. Derivatives are carried as financial assets when the fair value is positive and as finan-
cial liabilities when the fair value is negative. LAVAZZA GROUP
For the purpose of hedge accounting, hedges are classified as:
Subsequent measurement Consolidated Financial Statements
The measurement of financial liabilities depends on their classification, as described below:
> fair value hedges when hedging the exposure to changes in the fair value of a
recognised asset or liability or an unrecognised firm commitment;
at 31 December 2021
> cash flow hedges when hedging the exposure to variability in cash flows that is
FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS either attributable to a particular risk associated with a recognised asset or liability ACCOUNTING STATEMENTS
or a highly probable forecast transaction or the foreign currency risk in an unrec- > Consolidated Statement of Financial Position
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial lia- ognised firm commitment;
bilities designated upon initial recognition as at fair value through profit or loss. > Consolidated Statement of Profit or Loss
Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing or transfer- > hedges of a net investment in a foreign operation. > Consolidated Statement of Comprehensive Income
ring them in the near term. This category also includes derivative financial instruments entered into by the Group
that are not designated as hedging instruments in hedge relationships as defined by IFRS 9. Separated embedded At the inception of a hedge relationship, the Group formally designates and docu-
derivatives are also classified as held for trading unless they are designated as effective hedging instruments. ments the hedge relationship to which it wishes to apply hedge accounting and the > Consolidated Statement of Changes in Equity
Gains or losses on liabilities held for trading are recognised in the statement of profit or loss. risk management objective and strategy for undertaking the hedge.
Financial liabilities are designated upon initial recognition at fair value through profit or loss only if the criteria in Beginning 1 January 2018, the documentation includes identification of the hedging
IFRS 9 are satisfied. The Group has not designated any financial liability as at fair value through profit or loss upon instrument, the hedged item, the nature of the risk being hedged and how the Group NOTES TO THE CONSOLIDATED
initial recognition. will assess whether the hedging relationship meets the hedge effectiveness require-
ments (including the analysis of sources of hedge ineffectiveness and how the hedge
ratio is determined). The hedging relationship qualifies for hedge accounting if it INDEPENDENT AUDITORS’ REPORT
LOANS AND BORROWINGS meets all of the following effectiveness requirements:
After initial recognition, loans and borrowings are subsequently measured at amortised cost using the EIR method. > there is an economic relationship between the hedged item and the hedging
Gains and losses are recognised in profit or loss when the liabilities are derecognised or following the amortisation instrument;
process. LUIGI LAVAZZA S.p.A.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that > the effect of credit risk does not dominate the value changes that result from that
are an integral part of the EIR. The EIR amortisation is included as finance expenses in the statement of profit or loss. economic relationship; Financial Statements
This category generally applies to interest-bearing loans and borrowings.
> the hedge ratio of the hedging relationship is the same as that resulting from the
at 31 December 2021
quantity of the hedged item that the Group actually hedges and the quantity of the ACCOUNTING STATEMENTS
hedging instrument that the Group actually uses to hedge that quantity of hedged
Derecognition of a financial liability item. > Balance Sheet

A financial liability is derecognised when the obligation underlying the liability is discharged or expires. When an
existing financial liability is replaced by another from the same lender on substantially different terms, or the terms
of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition
of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is
recognised in the statement of profit or loss for the year. NOTES TO THE FINANCIAL STATEMENTS
Financial assets and financial liabilities may be offset and the net amount reported in the consolidated statement
of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an INDEPENDENT AUDITORS’ REPORT
intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

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Inventories
Hedges that meet all the qualifying criteria for hedge accounting are accounted for, as described below:
FAIR VALUE HEDGES Beginning 1 January 2018, the Group designates only COMPANY OFFICERS
the spot element of forward contracts as a hedging Inventories are valued at the lower of cost and realisable value.
GROUP STRUCTURE
The change in the fair value of a hedging instrument instrument. The forward element is recognised in OCI Costs incurred in bringing each product to its present location and condition are accounted for, as follows:
is recognised in the statement of profit or loss. The and accumulated in a separate component. LETTER TO SHAREHOLDERS
change in the fair value of the hedged item attributable The amounts accumulated in OCI are accounted for, > raw materials: purchase cost on a weighted mean cost basis;
to the risk hedged is recorded as part of the carrying depending on the nature of the underlying hedged DIRECTORS’ SINGLE REPORT
value of the hedged item and is also recognised in the transaction. > finished goods and work in progress: cost of direct materials and labour and a proportion of manufacturing ON OPERATIONS
statement of profit or loss as other expense. For any other cash flow hedges, the amount accumu- overheads based on the normal operating capacity, but excluding borrowing costs.
For fair value hedges relating to items carried at am- lated in OCI is reclassified to profit or loss as a reclassi-
ortised cost, any adjustment to carrying value is amor- fication adjustment in the same period or periods dur- The cost of inventories includes the transfer of gains and losses on qualifying cash flow hedges, recognised in OCI, LAVAZZA GROUP
tised through profit or loss over the remaining term of ing which the hedged cash flows affect profit or loss. in respect of the purchases of raw materials.
the hedge using the EIR method The EIR amortisation The presumable net realisable value is the estimated selling price in the ordinary course of business, less estimated Consolidated Financial Statements
may begin as soon as an adjustment exists and no later
than when the hedged item ceases to be adjusted for HEDGES OF A NET INVESTMENT IN A FOREIGN
costs of completion and the estimated costs necessary to make the sale.
Provisions for impairment are calculated for materials, finished products, replacement parts and other goods
at 31 December 2021
changes in its fair value attributable to the risk being OPERATION deemed obsolete or slow-moving, in view of their expected future use and realisable value.
hedged.
If the hedged item is derecognised, the unamortised Hedges of a net investment in a foreign operation, in- ACCOUNTING STATEMENTS
fair value is recognised immediately in profit or loss. cluding a hedge of a monetary item that is accounted > Consolidated Statement of Financial Position
Cash and short-term deposits

When an unrecognised firm commitment is designated for as part of the net investment, are accounted for in
as a hedged item, the subsequent cumulative changes a way similar to cash flow hedges. Gains or losses on > Consolidated Statement of Profit or Loss
in the fair value of the firm commitment attributable the hedging instrument relating to the effective portion > Consolidated Statement of Comprehensive Income
to the hedged risk is recognised as an asset or liability of the hedge are recognised as OCI while any gains or
with a corresponding gain or loss recognised in profit losses relating to the remaining (ineffective) portion Cash and short-term deposits comprise cash and demand and short-term deposits with a maturity of three months
or loss. are recognised in the statement of profit or loss. On or less, which are not subject to significant risks of changes in value. > Consolidated Statement of Changes in Equity
disposal of the foreign operation, the cumulative value For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of cash and short-
of any such gains or losses is transferred to the state- term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the
CASH FLOW HEDGES ment of profit or loss. Group’s cash management. Cash and cash equivalents are recognised, depending on their nature, at nominal value NOTES TO THE CONSOLIDATED
or at amortised cost.
The effective portion of the gain or loss on the hedging
instrument is recognised in OCI in the cash flow hedge INDEPENDENT AUDITORS’ REPORT
reserve, while any ineffective portion is recognised in
Treasury shares
the statement of profit or loss. The cash flow hedge re-
serve is adjusted to the lower of the cumulative gain
or loss on the hedging instrument and the cumulative
change in fair value of the hedged item. LUIGI LAVAZZA S.p.A.
The Group uses forward currency contracts as hedg- Treasury shares are recognised at cost and deducted from equity. No gain or loss is recognised in profit or loss on
es of its exposure to foreign currency risk in planned the purchase, sale, issue or cancellation of treasury shares. Any difference between the carrying amount and the Financial Statements
transactions and firm commitments, as well as forward
commodity contracts for its exposure to volatility in the
consideration, if reissued, is recognised as share premium.
The Directors’ Single Report on Operations provides further information on this item.
at 31 December 2021
commodity prices. The ineffective portion relating to ACCOUNTING STATEMENTS
foreign currency contracts is recognised as other ex-
pense and the ineffective portion relating to commodi- > Balance Sheet
ty contracts is recognised in other operating income or > Statement of Profit or Loss
expenses.


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Provisions Revenues
COMPANY OFFICERS
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, Revenues are generated by the Group’s ordinary operations and include revenues from sales and the provision of
GROUP STRUCTURE
it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and services. Revenues are recognised net of VAT, returns and discounts.
a reliable estimate can be made of the amount of the obligation. When the Group expects some or all of a provision Revenue from contracts with customers is recognised when control of the goods and services is transferred to the LETTER TO SHAREHOLDERS
to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, customer for an amount that reflects the consideration that the Group expects to receive in exchange for such goods
but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the state- or services. The Group has generally concluded that it acts as Principal for the agreements that give rise to revenue, DIRECTORS’ SINGLE REPORT
ment of profit or loss net of any reimbursement. since it usually controls the goods and services before they are transferred to the customer. When determining the ON OPERATIONS
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that re- price of the transaction for the sale of goods, the Group considers the effects deriving from the presence of variable
flects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due consideration, significant financing components and non-monetary considerations. If the consideration promised in
to the passage of time is recognised as a finance expense. the contract includes a variable amount, such as the amount related to a right of return, the Group estimates the LAVAZZA GROUP
amount of the consideration to which it will be entitled in exchange for the transfer of goods to the customer. The
process underlying the recognition of revenue follows the phases provided for by IFRS 15. Consolidated Financial Statements
The transfer of control generally coincides with the shipment or delivery of the goods.
Service revenues are recognised in profit or loss when the services are completed, or on an ongoing basis to the
at 31 December 2021
extent that the services in question have been rendered during the year.
Provisions for employee benefits ACCOUNTING STATEMENTS

Sales of machines > Consolidated Statement of Financial Position
The cost of providing benefits under the defined benefit plan is determined using the projected unit credit method. Revenues from the sale of coffee machines are recognised when the significant risks and rewards associated with > Consolidated Statement of Profit or Loss
Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts in- ownership of the goods are transferred to the buyer, when it is likely that the consideration will be recovered, the > Consolidated Statement of Comprehensive Income
cluded in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included related costs or return, where applicable, may be reliably estimated and the management ceases to carry out the
in net interest on the net defined benefit liability), are recognised immediately in the statement of financial position level of ongoing activity typically associated with ownership of the goods sold.
with a corresponding debit or credit to retained earnings through OCI in the period in which they occur. The transfer of the risks and rewards normally coincides with shipment to the client, which corresponds with the > Consolidated Statement of Changes in Equity
Remeasurements are not reclassified to profit or loss in subsequent periods. moment of delivery of the goods to the carrier.
Past service costs are recognised in profit or loss on the earlier of: When recognising revenues, the Group verifies whether there are conditions that represent separate services to
which a share of the price of sale is to be attributed. Accordingly, sales revenues include the effects of variable com- NOTES TO THE CONSOLIDATED
> the date of the plan amendment or curtailment ponents, the existence of significant financial components, non-monetary consideration and any consideration due
and to the client.
The Group typically provides warranties for the repair of defects existing at the time of sale, in accordance with INDEPENDENT AUDITORS’ REPORT
> the date that the Group recognises related restructuring costs. the law. These standard quality warranties are accounted for in accordance with IAS 37 — Provisions, Contingent
Liabilities and Contingent Assets. Please refer to the Note on warranties.
Net interest of the net asset or liability for defined benefits must be calculated by applying the discount rate to the
net defined benefit liability or asset. The Group recognises the following changes in the net defined benefit obliga-
tion under cost of sales, administration expenses and selling and distribution expenses in the consolidated state- LUIGI LAVAZZA S.p.A.
Government grants
ment of profit or loss (by nature):
> service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-rou-
tine settlements;
at 31 December 2021
Government grants are recognised where there is reasonable assurance that the grant will be received and all at- ACCOUNTING STATEMENTS
> net interest expense or income. tached conditions will be complied with. When the grant relates to an expense item, it is recognised as income on a
systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. When > Balance Sheet
the grant relates to an asset, it is recognised as income in equal amounts over the expected useful life of the related > Statement of Profit or Loss
asset.
When the Group receives grants of non-monetary assets, the asset and the grant are recorded at nominal amounts
and released to profit or loss on a straight-line basis over the expected useful life of the asset.


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Dividends
COMPANY OFFICERS
The Parent Company recognises a liability for a dividend payment when the distribution is authorised and the dis- Deferred tax assets and liabilities are measured at the tax rates that are expected to
GROUP STRUCTURE
tribution is no longer at the discretion of the Company. As per applicable European corporate laws, a distribution is apply in the year when the asset is realised or the liability is settled, based on current
authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity. tax rates, or approved tax rates, or rates that are substantively in force at the reporting LETTER TO SHAREHOLDERS
date.
Deferred taxes relating to items recognised outside profit or loss are also recognised DIRECTORS’ SINGLE REPORT
outside profit or loss, thus in equity or in OCI consistently with the underlying element. ON OPERATIONS
Income taxes
Tax benefits acquired as part of a business combination, but not satisfying the criteria
for separate recognition at that date, are recognised subsequently if new information
about facts and circumstances change. The adjustment is either treated as a reduc- LAVAZZA GROUP
tion in goodwill (as long as it does not exceed goodwill) if it was incurred during the
measurement period or recognised in profit or loss if it was recognised subsequently. Consolidated Financial Statements
Current taxes The Group offsets deferred tax assets and deferred tax liabilities if, and only if, it has
at 31 December 2021
a legally enforceable right to set off current tax assets and current tax liabilities and
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation the deferred tax assets and deferred tax liabilities relate to income taxes levied by the
authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively en- same taxation authority on either the same taxable entity or different taxable entities
acted at the reporting date in the countries where the Group operates and generates taxable income. which intend either to settle current tax liabilities and assets on a net basis, or to re- ACCOUNTING STATEMENTS
This calculation is therefore carried out using all the elements and information available at the reporting date, tak- alise the assets and settle the liabilities simultaneously, in each future period in which > Consolidated Statement of Financial Position
ing account of laws in force from time to time and also considering and including all the elements in the valuations significant amounts of deferred tax liabilities or assets are expected to be settled or
that could give rise to uncertainties when determining the amounts payable to the taxation authorities, as provided recovered. > Consolidated Statement of Profit or Loss
for by IFRIC 23. > Consolidated Statement of Comprehensive Income
Income taxes are recognised in the Consolidated Statement of Profit or Loss, except for those relating to items
debited or credited directly to an equity reserve; in these cases, the related tax effect is recognised directly in the
respective equity reserves. > Consolidated Statement of Changes in Equity

Deferred taxes
Deferred taxes are provided using the liability method on temporary differences between the tax bases of assets and INDEPENDENT AUDITORS’ REPORT
liabilities and their carrying amounts for financial reporting purposes at the reporting date.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
> when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction
that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor LUIGI LAVAZZA S.p.A.
taxable profit or loss;
> when the reversal of taxable temporary differences, linked to investments in subsidiaries and associates, can be
controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
at 31 December 2021
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits
and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will > Balance Sheet
be available against which the deductible temporary differences, and the carry forward of unused tax credits and > Statement of Profit or Loss
unused tax losses can be utilised, except:
> when the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; NOTES TO THE FINANCIAL STATEMENTS
> in respect of deductible temporary differences associated with investments in subsidiaries and associates, de-
ferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse INDEPENDENT AUDITORS’ REPORT
in the foreseeable future and taxable profit will be available so that the temporary differences can be utilised.

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6. New accounting standards and

interpretations issued by the IASB COMPANY OFFICERS
GROUP STRUCTURE
Amendments to IFRS 16 — Leases: Covid-19-Related Rent DIRECTORS’ SINGLE REPORT

The Group applied for the first time several standards or amendments that entered Concessions beyond 30 June 2021 ON OPERATIONS
into force on 1 January 2021.
The Group did not opt for early application of any of the new standards, interpreta- On 9 October 2020, Regulation (EU) No. 2020/1434 was issued to implement several
tions or amendments issued but not entered into force yet. amendments to IFRS 16 aimed at simplifying lessees’ accounting of Covid-19-related LAVAZZA GROUP
rent concessions. The amendment allows a lessee not to apply the requirements of
IFRS 16 relating to the accounting effects of contract modifications for rent conces- Consolidated Financial Statements
sions granted by lessors as a direct consequence of the Covid-19 epidemic.
at 31 December 2021
Accounting standards, amendments and
The amendment introduces a practical expedient according to which a lessee may
choose not to account for rent concessions as if they were lease modifications. A les-
interpretations applicable as at 1 January 2021

see that chooses to adopt this practical expedient recognises such concessions as if
they were not contract modifications within the scope of IFRS 16. ACCOUNTING STATEMENTS
The amendments were supposed to be applicable until 30 June 2021, but as the im- > Consolidated Statement of Financial Position
pact of the COVID-19 pandemic continues, on 31 March 2021 the IASB extended the
period for applying the practical expedient up to 30 June 2022. > Consolidated Statement of Profit or Loss
The amendments apply to financial years starting on or after 1 April 2021. > Consolidated Statement of Comprehensive Income
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4, IFRS 16 – The adoption of these amendments had a positive effect on the Consolidated Financial
Interest Rate Benchmark Reform – Phase 2 Statements at 31 December 2021 amounting to approximately €300 thousand and > Consolidated Statement of Cash Flows
referring property leases. > Consolidated Statement of Changes in Equity
On 13 January 2021 Regulation (EU) No. 2021/25 was issued. It endorses a series
of amendments to IFRS standards regarding the reform of inter-bank offered rates NOTES TO THE CONSOLIDATED
(IBOR) and other interest rate benchmarks. The amendments are aimed at helping New accounting standards and interpretations issued by IASB
companies to provide investors with useful information about the effects of the reform but not yet applicable
on those companies’ financial statements. INDEPENDENT AUDITORS’ REPORT
The amendments complement those issued in 2019 and focus on the effects on finan- As at the date of preparation of these Consolidated Financial Statements, the IASB
cial statements when a company replaces the old interest rate benchmark with an had issued the following new Standards and Interpretations not yet in effect:
alternative benchmark rate as a result of the reform.
The amendments in this final phase relate to: APPLICATION MANDATORY
AS OF LUIGI LAVAZZA S.p.A.
a. changes to contractual cash flows — a company will not have to derecognise or New Standards/ Interpretations not yet endorsed by the EU
adjust the carrying amount of financial instruments for changes required by the Amendments to IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors:
at 31 December 2021
reform, but will instead update the effective interest rate to reflect the change to 01/01/2023
Definition of Accounting Estimates
the alternative benchmark rate; Amendments to IAS 1 – Presentation of Financial Statements: Disclosure of Accounting Policies 01/01/2023
Amendments to IAS 1 – Presentation of Financial Statements: Classification of Liabilities as Current or
01/01/2023 ACCOUNTING STATEMENTS
b. hedge accounting — a company will not have to discontinue its hedge accounting Non-current
solely because it makes changes required by the reform, if the hedge meets other > Balance Sheet
Amendments to IAS 12 – Income Taxes: Assets and Liabilities Arising from a Single Transaction 01/01/2023
hedge accounting criteria; New Standards/ Interpretations endorsed by the EU but not yet effective > Statement of Profit or Loss
Amendments to:
IFRS 3 – Business Combinations; > Statement of Cash Flows
c. disclosures — a company will be required to disclose information about new risks
IAS 16 – Property, Plant and Equipment; 01/01/2022
arising from the reform and how it manages the transition to alternative bench- IAS 37 – Provisions, Contingent liabilities and Contingent Assets;
mark rates. Annual Improvements 2018 – 2020 Cycle
The adoption of these amendments did not impact the Consolidated Financial
Statements. The possible impacts on the Consolidated Financial Statements of the new Standards/
Interpretations are currently under assessment. INDEPENDENT AUDITORS’ REPORT

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7. Estimates and assumptions Impairment of non-financial assets

COMPANY OFFICERS
Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount,
GROUP STRUCTURE
which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal
calculation is based on available data from binding sales transactions, conducted at arm’s length, for similar as- LETTER TO SHAREHOLDERS
sets or observable market prices less costs of disposing of the asset. The calculation of the value in use calculation
is based on a DCF model. The estimate of future cash flows is based on plans approved by the Board of Directors DIRECTORS’ SINGLE REPORT
The preparation of the Financial Statements and related Notes requires management having a horizon of at least five years and is founded on reasonable and sustainable assumptions, in keeping with ON OPERATIONS
to make estimates and assumptions based also on subjective judgements, past expe- the consistency between prospective and historic cash flows. In addition, the cash flows do not include restructuring
rience and hypotheses considered reasonable and realistic in relation to the informa- activities to which the Group has not yet committed or significant future investments that will increase the results
tion known at the time of the estimate. Such estimates have an effect on the reported of the assets making up the cash-generating unit being valued. The recoverable amount is sensitive to the discount LAVAZZA GROUP
amount of assets and liabilities and the amount of revenues and costs during the rate used for the DCF model, as well as to the expected future cash-inflows and the growth rate used for extrapola-
reporting period. tion purposes. The key assumptions used to determine the recoverable amount for the different CGUs, including a Consolidated Financial Statements
The key assessment procedures and assumptions concerning the future used by the
management in the application of accounting processes and that can have significant
sensitivity analysis, are disclosed and further explained in paragraph 10.2.
at 31 December 2021
effects on the items recognised in the Consolidated Financial Statements or for which
there is a risk of causing a material adjustment to the carrying amounts of assets and
Taxes
liabilities within the next financial year are summarised below.
Due to the uncertainty associated with the unprecedented nature of the Covid-19-
related situation, the Group has carefully assessed and considered the pandemic’s > Consolidated Statement of Profit or Loss
impact on year-end data and provided, where necessary, specific disclosure to take Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit will be > Consolidated Statement of Comprehensive Income
account of its effects on the profit or loss results. available against which the losses can be utilised. Significant management judgement is required to determine the
A targeted analysis was carried out to identify, and consequently manage, the main amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable
risks and uncertainties to which the Group is exposed. profits, together with future tax planning strategies. > Consolidated Statement of Changes in Equity
In particular, all the significant assumptions and estimates underlying the prepa-
ration of the following items have been examined and analysed in detail in order to
Defined benefit plans

identify and manage the uncertainties linked to the unpredictability and potential NOTES TO THE CONSOLIDATED
impact of the pandemic: impairment of non-financial assets, fair value valuation of
financial instruments, valuation of expected credit losses, deferred tax assets and tax
relief, recognition of revenues, leases, provisions and onerous contracts. INDEPENDENT AUDITORS’ REPORT
The analysis conducted did not highlight any critical situations that cannot be ad- The cost of the defined benefit pension plans and other post-employment benefits and the present value of the
dressed in the normal course of business. pension obligation are determined using actuarial valuations. An actuarial valuation involves making various as-
Where the analysis has not led to particular conclusions, additional specific infor- sumptions that may differ from actual developments in the future. These include the determination of the discount
mation is provided in the Notes to the Consolidated Financial Statements, whilst no rate, future salary increases, mortality rates and future pension increases. Due to the complexities involved in the
particular explanations are provided when the effects of the Covid-19 pandemic have valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. LUIGI LAVAZZA S.p.A.
had no specific impact on the Group’s financial performance, financial position and All assumptions are reviewed yearly.
cash flows. The parameter most subject to change is the discount rate. In determining the appropriate discount rate, the direc- Financial Statements
tors refer to the interest rate on corporate bonds denominated in currencies consistent with the currencies of the
defined benefit obligations, rated AA or higher by internationally recognised rating agencies, with average matur-
at 31 December 2021
ities corresponding to the expected duration of the defined benefit obligations. The underlying bonds are further ACCOUNTING STATEMENTS
reviewed for quality. Those having excessive credit spreads are excluded from the analysis of bonds on which the
discount rate is based, on the basis that they do not represent high quality corporate bonds. > Balance Sheet
The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables > Statement of Profit or Loss
tend to change only at intervals in response to demographic changes. Future salary increases and pension increases
are based on expected future inflation rates for the respective countries. Further details about pension obligations
are provided in paragraph 10.16.


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Fair value measurement of financial instruments 8. Capital management

COMPANY OFFICERS
When the fair values of financial assets and financial liabilities recorded in the state-
GROUP STRUCTURE
ment of financial position cannot be measured based on quoted prices in active mar- For the purpose of the Group’s capital management, capital includes issued capital, share premium and all other
kets, their fair value is measured using valuation techniques including the discounted equity reserves attributable to the equity holders of the parent. The primary objective of the Group’s capital man- LETTER TO SHAREHOLDERS
cash flow (DCF) model. The inputs to these models are taken from observable mar- agement is to maximise the shareholder value. The Group manages its capital structure and makes adjustments
kets where possible, but where this is not feasible, a degree of judgement is required in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the DIRECTORS’ SINGLE REPORT
in establishing fair values. Estimates include considerations of inputs such as liquidity dividend payment to shareholders, return capital to shareholders or issue new shares. ON OPERATIONS
risk, credit risk and volatility. Changes in assumptions relating to these factors could
affect the reported fair value of financial instruments.
Contingent consideration, resulting from business combinations, is valued at fair val- LAVAZZA GROUP
ue at the acquisition date as part of the business combination. When the contingent
consideration meets the definition of derivative and is thus a financial liability, it is Consolidated Financial Statements
subsequently remeasured to fair value at each reporting date. The determination of
the fair value is based on discounted cash flows. The key assumptions take into con- 9. Reconciliation between the Financial at 31 December 2021
Statements of Lavazza S.p.A. and the

sideration the probability of meeting each performance target and the discount factor
(see Notes 10.21 and 10.22 for details).
Consolidated Financial Statements as > Consolidated Statement of Financial Position
Development costs of 31 December 2021 > Consolidated Statement of Comprehensive Income

The Group capitalises costs for product development projects. Initial capitalisation of
costs is based on management’s judgement that technological and economic feasibil-
ity is confirmed, usually when a product development project has reached a defined EQUITY PROFIT (LOSS) FOR THE
milestone according to an established project management model. In determining the ATTRIBUTABLE TO YEAR ATTRIBUTABLE TO
THE GROUP THE GROUP FINANCIAL STATEMENTS
amounts to be capitalised, management makes assumptions regarding the expected
Luigi Lavazza S.p.A. - separate financial statements based on Italian GAAP 2,398,448 103,604
future cash generation of the project, discount rates to be applied and the expected INDEPENDENT AUDITORS’ REPORT
period of benefits. In 2021, the carrying amount of capitalised development costs was IFRS / IAS adjustments Luigi Lavazza S.p.A. 94,860 17,290
€3.5 million, whereas those capitalised in the previous year amounted to €3.1 million. Luigi Lavazza S.p.A. - based on IFRS/IAS 2,493,308 120,894
Difference between the carrying amount and the share of the book equity of investees (60,922) 16,040
Elimination of dividends and results of equity investments - (21,114)
Difference from consolidation for acquisitions 129,812 - LUIGI LAVAZZA S.p.A.
Other consolidation adjustments including intercompany profit (31,798) (10,292)
TOTAL 2,530,400 105,528
at 31 December 2021
> the effects of the IFRS/IAS adjustments of Luigi Lavazza S.p.A. mainly referred to the measurement of ACCOUNTING STATEMENTS
intangible assets, and in particular the write-off of depreciation and amortisation of assets that the
international standards classify among those with indefinite useful lives; > Balance Sheet

> differences from consolidation for acquisitions mainly refer to the positive differences between the
consideration paid and net assets acquired following the acquisitions and business combinations and
are chiefly recognised as goodwill in the Consolidated Financial Statements and not recognised in the
Financial Statements of the individual subsidiaries.

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Notes to the Consolidated

COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021
10. Consolidated Statement of
Financial Position ACCOUNTING STATEMENTS

10.1 Goodwill > Consolidated Statement of Changes in Equity
The following table shows the item “Goodwill” at 31 December 2021 and its change in the reporting year: NOTES TO THE CONSOLIDATED
Balance at 31.12.2020 917,899
Exchange delta and other changes 39,277
Balance at 31.12.2021 957,176
The change in goodwill was chiefly attributable to the positive exchange rate effect for goodwill denominated in LUIGI LAVAZZA S.p.A.
foreign currencies (in particular US Dollar and Canadian Dollar). The change also included a €823 thousand reclas-
sification of industrial patents following the allocation of the consolidation difference arising from the acquisition of Financial Statements
the interest in Caffemotive S.r.l., finalised at the end of the previous year.
In 2020, the consolidation difference had been fully allocated to industrial patents for approximately €2.7 million; in
at 31 December 2021
the reporting year, it was partly reclassified following the merger of the investee in the Parent Company, effective 1 ACCOUNTING STATEMENTS
January 2021.
The following table provides the breakdown of goodwill by CGU: > Balance Sheet

31.12.2020 EXCHANGE RATES AND OTHERS 31.12.2021
CGU America 383,357 31,164 414,521

CGU France 419,322 282 419,604 NOTES TO THE FINANCIAL STATEMENTS
CGU Italy 18,723 823 19,546
CGU Rest of Europe and Rest of world 96,497 7,008 103,505
Total 917,899 39,277 957,176 INDEPENDENT AUDITORS’ REPORT

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Impairment test of goodwill and intangible assets with indefinite useful lives
10.2 Other intangible assets
The goodwill and trademarks with indefinite useful lives acquired in business combinations (€957,176 thousand COMPANY OFFICERS
The following table shows the composition and movements of other intangible assets: and €192,014 thousand, respectively) have been allocated to cash generating units for impairment-testing purpos-
GROUP STRUCTURE
es. Four cash generating units (CGUs) have been identified for this purpose on a geographical basis: Italy, France,
BALANCE AT INCREASES (DECREASES) RECLASSIFICATIONS EXCHANGE BALANCE AT America, Rest of Europe and Rest of World, in accordance with management’s business governance and that also LETTER TO SHAREHOLDERS
31.12.2020 DELTA 31.12.2021
reflects CGUs’ geographical location.
The carrying amounts of the CGUs (coinciding with the value of net invested capital) have been tested for recover- DIRECTORS’ SINGLE REPORT
Development costs
Gross value 14,214 354 - 3,171 52 17,791 ability by comparing them with their recoverable amounts, calculated as the net present value of the future cash ON OPERATIONS
(Write-down provision) (171) - - - - (171) flows that are estimated to derive from ongoing use of the assets concerned ("value in use"). At the end of the explicit
(Accumulated depreciation) (9,540) (1,931) - - (28) (11,498) forecast period represented by the cash flows based on the projected financial performance up to 2026 were used to
Net value 4,504 (1,577) - 3,171 24 6,122 estimate a terminal value equal to the value of the cash flows at the end of the explicit period to reflect the value of LAVAZZA GROUP
Rights for industrial patents and the CGUs beyond the plan period on a going-concern basis.
rights for exploitation of intellectual
property
The main assumptions adopted in determining the value in use are set out below broken down by CGU. Consolidated Financial Statements
Gross value 26,367 37 - (1,245) 1,382 26,541 at 31 December 2021
(Write-down provision) - - - - - -
(Accumulated depreciation) (6,456) (3,255) - 16 (436) (10,130)
CGU WACC G RATE
Net value 19,911 (3,218) - (1,229) 946 16,411
Italy 8.5% 0.9% ACCOUNTING STATEMENTS
Concessions, licenses and similar
rights France 7.6% 1.5% > Consolidated Statement of Financial Position
Gross value 182,745 651 - 377 396 184,169 America 6.8% 2.2%
(Write-down provision) - - - - - Rest of Europe and Rest of the world 8.4% 2.1%
(Accumulated amortisation) (55,014) (10,124) - 18 (221) (65,340) > Consolidated Statement of Comprehensive Income
Net value 127,730 (9,472) - 396 175 118,829
Trademarks
Gross value 510,544 - - - 5,783 516,328
The discount rate was calculated as the average cost of capital (WACC) in Euro, according to a post-tax configuration, > Consolidated Statement of Changes in Equity
(Write-down provision) (311,037) - - - - (311,037) based on the weighted average cost of capital, calculated on the basis of the CAPM (Capital Asset Pricing Model) and
(Accumulated amortisation) (2,987) (1,493) 71 - (247) (4,655) the Group's borrowing costs.
Net value 196,520 (1,493) 71 - 5,537 200,635 As required by IAS 36, this rate was determined by reference to industry's operating risk level and the financial struc- NOTES TO THE CONSOLIDATED
ture of a set of listed companies comparable to the Group in terms of risk profile and business sector. The discount
Total other intangible assets FINANCIAL STATEMENTS
rate applied has been calculated to reflect the risk in the geographical areas in which the Group operates, taking the
Gross value 129,693 3,705 (873) 18,434 3,900 154,858 breakdown of EBITDA in the final year of the explicit forecast period (2026) as the WACC weighting factor for each INDEPENDENT AUDITORS’ REPORT
geographical area. In particular, the calculation takes account of the following elements:
(Accumulated amortisation) (40,969) (15,124) 18 (5) (672) (56,752)
Net value 88,723 (11,419) (855) 18,428 3,229 98,106
> the risk-free rate: considering the country risk represented by CDSs for each area;
Fixed assets in process and advances
Gross value 8,878 21,390 - (21,645) 45 8,669 > the unlevered beta defined by geographical area; LUIGI LAVAZZA S.p.A.
Net value 8,878 21,390 - (21,645) 45 8,669 > the market risk premium: market data. Financial Statements
Total intangible assets
The test carried out did not identify any need for impairment with regard to the carrying amount, goodwill and other
at 31 December 2021
Gross value 872,442 26,138 (873) (908) 11,559 908,357
assets with indefinite life. The value of use of CGUs, calculated as described above, exceeded their carrying amount. ACCOUNTING STATEMENTS
(Write-down provision) (311,207) - - - - (311,207)
(Accumulated amortisation) (114,966) (31,926) 89 29 (1,603) (148,377) The Group has also conducted various analyses of the sensitivity of the test results to changes in the underlying as-
sumptions conditioning the value in use of the cash generating units (discount rate, WACC, g growth rate and long- > Balance Sheet
Net value 446,268 (5,788) (784) (879) 9,956 448,773
term margins). The elaboration of alternative scenarios which foresee a delay in the recovery, reflecting the current > Statement of Profit or Loss
level of uncertainty about future economic prospects, highlighted the presence of headroom for all the CGUs as well.
The increases in other intangible assets and fixed assets in process mainly refer to new IT (Information Technology)
investments made in the reporting year to strengthen the Group’s integration process; these investments were
mainly obtained through external sources.
Reclassification mainly referred to those resulting from the merger of Caffemotive S.r.l. into the Parent Company, as NOTES TO THE FINANCIAL STATEMENTS
described in the previous section.

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10.3 Rights of use

COMPANY OFFICERS
Rights of use totalled €167,700 and refer for €167,610 to contracts for property, plant and equipment and for €90 The gross increases for the period of €18,202 mainly refer to properties used for commercial purposes (€12,553),
GROUP STRUCTURE
thousand to right-of-use intangible assets, namely right-of-use software. industrial equipment (€1,097) and vehicles used by employees (€4,232).
The breakdown and movements of rights of use of intangible fixed assets are shown in the following tables: The decreases for the period chiefly relate to properties for which the operating lease contract expired in the year LETTER TO SHAREHOLDERS
and vehicles used by employees.
BALANCE AT INCREASES (DECREASES) EXCHANGE BALANCE AT Rights of use for leased buildings include the former finance lease of the Nuvola Headquarters, already recognized DIRECTORS’ SINGLE REPORT
31.12.2020 DELTA 31.12.2021 in accordance with IAS 17. ON OPERATIONS
Right-of-use Land and buildings
Gross value 62,537 12,553 (5,119) 2,042 72,013 The effects associated with lease contracts falling within IFRS on the statement of profit or loss are shown in the
(Write-down provision) - - - - - following table: LAVAZZA GROUP
(Accumulated depreciation) (12,228) (7,592) 618 (272) (19,451)
Net value 50,309 4,961 (4,501) 1,770 52,562 Consolidated Financial Statements
Right-of-use Leased buildings
YEAR 2021 YEAR 2020
at 31 December 2021
Amortisation and depreciation (17,662) (16,872)
Gross value 115,844 - - - 115,844
(Write-down provision) - - - - - Interest (3,840) (3,710)
(Accumulated depreciation) (12,518) (3,510) - - (16,029) Lease costs for short-term and modest value contracts (5,258) (4,902)
Net value 103,325 (3,510) - - 99,815
Right-of-use Industrial and commercial > Consolidated Statement of Financial Position
equipment
The effects on cash flows shown in the statement of cash flows indicate a net use of cash to pay for rights of use > Consolidated Statement of Profit or Loss
Gross value 7,327 1,097 (583) 18 7,860
(Write-down provision) - - - - - totalling €18 million for the reporting year, compared to €17 million for the previous year. > Consolidated Statement of Comprehensive Income
(Accumulated depreciation) (1,100) (1,090) 574 (11) (1,627) It should be noted that the Group opted to apply the exemptions provided for in the Standard for lease contracts with
Net value 6,228 7 (9) 8 6,233 a term equal or below 12 months and with no purchase options (“short-term leases”) and for lease contracts whose
Right-of-use Furniture and fittings
underlying assets has a low value (“low value asset”). The Group also applied the practical expedient available for > Consolidated Statement of Changes in Equity
rent concessions granted by lessors that are directly related to the Covid-19 pandemic (about €0.3 million).
Gross value 376 59 (115) - 320
(Write-down provision) - - - - -
(Accumulated depreciation) (141) (72) 105 - (108) NOTES TO THE CONSOLIDATED
Net value 236 (13) (10) - 212 FINANCIAL STATEMENTS
Right-of-use Means of transport
Gross value 16,096 4,232 (3,460) 280 17,147
(Accumulated depreciation) (6,915) (4,904) 3,338 (90) (8,592)
Net value 9,181 (672) (122) 190 8,555
Right-of-use Electronic machines LUIGI LAVAZZA S.p.A.
Gross value 267 259 (234) - 311
(Write-down provision) - - - - - Financial Statements
(Accumulated depreciation)
Net value
(215)
52
(113)
146
234
-
-
-
(94)
217
at 31 December 2021
Right-of-use Other assets ACCOUNTING STATEMENTS
Gross value 32 2 - 1 35
> Balance Sheet
(Accumulated depreciation) (11) (7) - (1) (19) > Statement of Profit or Loss
Net value 21 (4) - - 16 > Statement of Cash Flows
Total right-of-use Property, plant and equipment
Gross value 202,480 18,202 (9,511) 2,341 213,530
(Write-down provision) - - - - - NOTES TO THE FINANCIAL STATEMENTS
(Accumulated depreciation) (33,128) (17,288) 4,869 (373) (45,920)
Net value 169,352 913 (4,643) 1,968 167,610 STATUTORY AUDITORS’ REPORT

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10.4 Property, plant and equipment

COMPANY OFFICERS
The breakdown and movements of property, plant and equipment are shown in the following table: The change in property, plant and equipment was mainly due to the new industrial investments and purchases of
GROUP STRUCTURE
machines intended for FOL (Free On Loan) use, net of depreciation for the year.
BALANCE AT INCREASES (DECREASES) RECLASSIFICATIONS EXCHANGE BALANCE AT
31.12.2020 DELTA 31.12.2021 The reclassifications item refers mainly to the entry into operation of tangible and intangible fixed assets relating LETTER TO SHAREHOLDERS
to projects completed in the current year and to the allocation to write-down of certain risk provisions set aside in
Land and buildings
previous years amounting to €4,036 thousand. A property located in Turin has also been reclassified as assets held DIRECTORS’ SINGLE REPORT
Gross value 213,461 670 (468) (7,184) 3,778 210,257 for sale, which will be sold and adjusted to fair value for a value of €1,000 thousand. ON OPERATIONS
(Write-down provision) (11,476) (1,647) 1,480 2,569 (33) (9,106)
(Accumulated depreciation) (75,629) (4,660) (112) 4,672 (1,054) (76,784)
Net value
Plant and machinery
126,355 (5,637) 900 58 2,691 124,367
LAVAZZA GROUP
Gross value
(Write-down provision)
859,127
(8,853)
2,274
(770)
(6,104)
3,691
29,681
(4,036)
4,797
(63)
889,775
(10,031)
10.5 Investments Consolidated Financial Statements
(Accumulated depreciation) (558,654) (33,765) 2,011 5,193 (1,875) (587,089) at 31 December 2021
Net value 291,620 (32,261) (401) 30,838 2,859 292,655
Investments recognised in the consolidated financial statements at 31 December 2021 were as follows:
Industrial and commercial equipment
Gross value 55,110 719 (35) 440 3 56,237 % HELD 31.12.2021 31.12.2020 CHANGES ACCOUNTING STATEMENTS
(Write-down provision) (3,377) (134) - - - (3,511)
Investments: > Consolidated Statement of Financial Position
(Accumulated depreciation) (43,511) (2,870) 30 (31) (3) (46,385)
a) Subsidiaries measured at cost
Net value 8,221 (2,285) (5) 409 - 6,341
Lavazza Maroc S.a.r.l. 100 1 1 - > Consolidated Statement of Profit or Loss
Espresso machines and other
commercial equipment Lavazza Trading (Shenzhen) Co. Ltd 100 1,000 1,000 - > Consolidated Statement of Comprehensive Income
Total subsidiaries measured at cost 1,001 1,001 -
Gross value 353,368 51,535 (37,813) 1,098 7,616 375,804 > Consolidated Statement of Cash Flows
(Write-down provision) (3,442) (535) 1,323 - - (2,654) b) in joint ventures - associates measured at equity
(Accumulated depreciation) (237,824) (50,718) 34,101 - (5,473) (259,913) La Manufacture de Café Alain Ducasse S.a.s. 50 425 625 (200) > Consolidated Statement of Changes in Equity
Net value 112,103 281 (2,389) 1,098 2,144 113,236 Y&L Cofee Ltd 35 30,271 4,894 25,377
Furniture and fittings Total in joint ventures - associates measured at equity 30,696 5,519 25,177
Gross value 41,797 3,169 (4,040) 2,875 624 44,424 c) Associates measured at cost NOTES TO THE CONSOLIDATED
International Coffee Partners G.m.b.H. 20 25 25 -
(Write-down provision) (120) - 96 - - (24) FINANCIAL STATEMENTS
(Accumulated depreciation) (29,436) (2,807) 3,898 - (394) (28,741) Total associates measured at cost 25 25
Net value 12,241 362 (47) 2,875 230 15,660 d) Other companies valued at FV INDEPENDENT AUDITORS’ REPORT
Means of transport Casa del Commercio e Turismo S.p.A. 3 6 6 -
Gross value 1,212 - (45) - 2 1,169 Air Vallée S.p.A. 2 - - -
(Write-down provision) - - - - - - Idroelettrica S.c.r.l. n.a. - - -
(Accumulated depreciation) (967) (48) 44 - (2) (973) Tamburi Investment Partners S.p.A. 4,965 3,445 1,520
Net value 244 (48) (1) - - 196 Clubitaly S.p.A. 6,536 6,409 127 LUIGI LAVAZZA S.p.A.
Electronic machines
Connect Ventures One LP 3 1,884 1,335 549
Gross value 38,151 1,124 (928) 1,140 729 40,216 Solar Investment Group B.V. 0.94 158 - 158
(Write-down provision) - - - - - - Immobilière 3 F (formerly Le Foyer du Fonctionnaire) n.a. - - - at 31 December 2021
(Accumulated depreciation) (28,990) (4,153) 891 6 (402) (32,649) Consorzio Nazionale Imballaggi n.a. - - -
Net value 9,161 (3,029) (37) 1,146 327 7,567 Companies valued at FV through profit or loss 13,549 11,195 2,354 ACCOUNTING STATEMENTS
Other assets INV. A.G. S.r.l. 11 13,049 6,394 6,655
> Balance Sheet
Gross value 2,521 14 (90) - 162 2,606 Companies valued at FV through OCI 13,049 6,394 6,655
(Write-down provision) - - - - - - Total other companies valued at FV 26,598 17,589 9,009
(Accumulated depreciation) (2,508) (52) 91 10 (162) (2,621)
Total 58,320 24,134 34,186 > Statement of Cash Flows
Net value 13 (38) 1 10 - (14)
Fixed assets in process and advances
Gross value 26,574 55,680 (823) (41,414) 717 40,735 In the reporting year, the subsidiary Y&L Coffee Ltd increased its share capital by €30.3 million. The interest in
(Write-down provision) (530) 521 - - - (9) the Chinese company, incorporated to study and develop the Lavazza Coffee Shop concept in China, remained un- NOTES TO THE FINANCIAL STATEMENTS
Net value 26,044 56,201 (823) (41,414) 717 40,726 changed at 35%.
Total property, plant and equipment From its incorporation, 20 new stores were opened in Chine, including in Shanghai, Hangzhou, Beijing and Guangzhou.
Gross value 1,591,320 115,186 (50,346) (13,363) 18,428 1,661,224
At the end of the year, the investment was adjusted to account for the value of the portion of equity attributable to INDEPENDENT AUDITORS’ REPORT
(Write-down provision) (27,798) (2,565) 6,590 (1,467) (96) (25,336) the Group, recognising an operating loss of €5.5 million carried by the latter.
(Accumulated depreciation) (977,519) (99,075) 40,954 9,850 (9,365) (1,035,155)
Net value 586,002 13,546 (2,802) (4,980) 8,967 600,734 SUSTAINABLE SINGLE PAGE
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10.6 Non-current and current financial assets

The investment in La Manufacture de Café, a 50%-owned French company acquired at the end of the previous year,
was also adjusted to account for the value of the portion of equity attributable to the Group, recognising an operating
loss of €0.2 million.
As reported in the tables here below, the movements in other countries refer essentially to adjustments to FV. It COMPANY OFFICERS
should be noted that 20,856 shares of Solar Investment Group were acquired through Lavazza Capital S.r.l., for a 31.12.2021 31.12.2020 CHANGES
GROUP STRUCTURE
total value of €0.177 million. Finance lease and other minor receivables 4,068 5,273 (1,205)
The Group received no dividends distributed by the above-mentioned investees. Financial trade receivables 11,786 18,762 (6,976) LETTER TO SHAREHOLDERS
Write-down provision for doubtful financial trade receivables (4,330) (3,262) (1,068)
The breakdown of investments in other companies is reported below: DIRECTORS’ SINGLE REPORT
Total non-current financial receivables 11,524 20,773 (9,249)
ON OPERATIONS
Mutual funds and other non-current securities 1,630 2,067 (437)
INV. A.G. S.R.L. (INVESTMENT MEASURED AT FV THROUGH OCI) Insurance policies 18,499 18,288 211
LAVAZZA GROUP
Derivatives and other hedging instruments 2,185 4,879 (2,694)
1 January 2020 10,915
Non-current securities and non-current financial instruments 22,314 25,234 (2,920)
Sales -
Purchases -
TOTAL NON-CURRENT FINANCIAL ASSETS 33,838 46,007 (12,169)
Total profit and losses recognised through OCI (4,521)
at 31 December 2021
31 December 2020 6,394
Sales - 31.12.2021 31.12.2020 CHANGES
Purchases - Financial receivables from others 16,402 91,187 (74,785)
Total profit and losses recognised through OCI 6,655 Financial trade receivables 28,585 31,514 (2,929) ACCOUNTING STATEMENTS
31 December 2021 13,049 Write-down provision for doubtful financial trade receivables (4,645) (4,779) 134 > Consolidated Statement of Financial Position
Financial receivables from companies controlled by Parent Companies 70,741 70,037 704
Total current financial receivables 111,083 187,959 (76,876)
Derivatives and other hedging financial instruments 16,499 27,745 (11,246) > Consolidated Statement of Comprehensive Income
OTHER INVESTMENTS VALUED AT FV THROUGH PROFIT OR LOSS
Equity securities 21,351 7,730 13,621 > Consolidated Statement of Cash Flows
1 January 2020 12,291 Bonds 227,962 168,709 59,253
Certificates of deposit - - -
Sales (1,417)
Mutual investment funds 1,104 552 552
Purchases 208
Other current securities 19 17 2
Total profit and losses recognised through Profit and Loss 113
31 December 2020 11,195 Total current securities and current financial instruments 266,935 204,753 62,182 NOTES TO THE CONSOLIDATED
Sales - TOTAL CURRENT FINANCIAL ASSETS 378,018 392,712 (14,694) FINANCIAL STATEMENTS
Purchases 337
Total profit and losses recognised through Profit and Loss 2,017
31 December 2021 13,549 Financial receivables
Notes 10.21 and 10.22 provide further information in this regard. Finance lease receivables refer to the sale through finance lease contracts of some special models of coffee ma-
chines for customers within the OCS sector. As a finance lease transaction, in addition to recognition of the receiv- LUIGI LAVAZZA S.p.A.
able, it entails the booking of interest income among finance income and expense. During the year, the receivable
was written down by €1 million to bring it into line with its presumable realisable value. Financial Statements
Financial trade receivables refer to loans granted by the subsidiary Cofincaf S.p.A. to customers and are tested to
verify the recoverability of their value pursuant to IFRS 9. On the basis of the analyses carried out, the value of fi-
at 31 December 2021
nancial trade receivables was adjusted to bring it into line with the presumable realisable value, as reported below: ACCOUNTING STATEMENTS
> Balance Sheet
PROVISION FOR THE WRITE-DOWN OF FINANCIAL TRADE RECEIVABLES
Balance at 31.12.2020 (8,041)
Provisions (1,025) > Statement of Cash Flows
Uses 92
Reclassifications -
Exchange rate delta - NOTES TO THE FINANCIAL STATEMENTS
Balance at 31.12.2021 (8,975)
The increase in the provision for write-downs was attributable to higher amounts allocated to bring it in line with INDEPENDENT AUDITORS’ REPORT
the risk profile.

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10.8 Other non-current and current assets

The following table provides a breakdown of the provision by maturity:
2021 2020
COMPANY OFFICERS
FINANCIAL WRITE-DOWN FINANCIAL WRITE-DOWN
31.12.2021 31.12.2020 CHANGES
RECEIVABLES PROVISION RECEIVABLES PROVISION GROUP STRUCTURE
FOR EXPECTED FOR EXPECTED Guarantee deposits 3,040 3,099 (59)
FUTURE LOSSES FUTURE LOSSES
Other non-current receivables 1,016 1,199 (183) LETTER TO SHAREHOLDERS
Not yet due 38,603 (8,216) 48,794 (7,785) TOTAL OTHER NON-CURRENT ASSETS 4,056 4,298 120
Less than 30 days 1 - 2 - Tax receivables 28,416 48,654 (20,238)
30-90 days 9 (1) 8 - Advances to suppliers 3,935 5,447 (1,512)
ON OPERATIONS
Within one year 678 (68) 304 (28) Prepayments and accrued income 37,541 32,656 4,885
LAVAZZA GROUP
Within five year 672 (430) 1,168 (228) Other receivables 2,002 1,540 462
Over five years 407 (260) - - TOTAL OTHER CURRENT ASSETS 71,894 88,297 (16,403)
Breakdown of receivables by maturity 40,371 (8,975) 50,276 (8,041)

at 31 December 2021
Write-down (8,975) - (8,041) - Amounts receivable from the treasury of €28.4 million primarily refer to VAT receivables claimed by Group compa-
Total 31,396 - 42,235 - nies and the amount claimed by the Parent Company (€8 million) in connection with subsidies for investments in
capital assets pursuant to Article 18 of Decree-Law 91 of 24 June 2014 (“Competitiveness Decree-Law”), converted,
with amendments, by Law No. 116 of 7 August 2014, and the research and development tax credit introduced by the
Current financial receivables from others amounted to €16 million, decreasing by about €75 million, mainly due to 2015 Stability Law (Law No. 190-2014). ACCOUNTING STATEMENTS
the closure of the short-term secured deposit denominated in USD held by Lavazza Capital S.r.l. > Consolidated Statement of Financial Position
The item “prepayments and accrued income” primarily refers to accrued income relating to commissions to agents
Financial receivables from companies controlled by parent companies referred to the loan granted in 2019 by the of the subsidiary Nims S.p.A. (about €24 million) and the portion not accrued during the year of advance payments > Consolidated Statement of Profit or Loss
subsidiary Lavazza Capital S.r.l., renewed annually, for a total amount of €70 million to the company Torino 1895 made to customers in the Food Service sector for the sponsorship of Lavazza products in the points of sale. Such > Consolidated Statement of Comprehensive Income
Investimenti S.p.A., a 100% owned subsidiary of Finlav S.p.A. costs will be recognised through profit or loss on an accrual basis over the term of the contract.
Non-current financial receivables are all due in one to five years.
Financial securities and hedging financial instruments 10.9 Inventories

Securities classified as non-current financial assets refer primarily to closed-ended mutual funds held by the sub-
31.12.2021 31.12.2020 CHANGES
sidiary Lavazza Capital S.r.l. and insurance policies contracted by the subsidiary Nims S.p.A.
Securities classified as current financial assets refer to ordinary bonds and equities listed on regulated markets and Raw materials, ancillaries and consumables (net value) 242,995 207,306 35,689 INDEPENDENT AUDITORS’ REPORT
held by the subsidiary Lavazza Capital S.r.l. Write-down provision for raw material, ancillaries and consumables (4,448) (3,281) (1,167)
Derivatives and other hedging instruments refer to the open positions in hedging derivatives at 31 December 2021 Raw materials, ancillaries and consumables (net value) 238,547 204,025 34,522
at their fair value.
Work in process (net value) 3,457 2,349 1,108
Notes 10.21 and 10.22 provide further information on financial assets.
Provision for work in progress (1,000) (1,200) 200
Work in process (net value) 2,457 1,149 1,308
Finished products and goods 226,924 224,288 2,636 Financial Statements
10.7 Deferred tax assets and liabilities at 31 December 2021
Write-down provision for finished products and goods (22,883) (25,670) 2,787
Finished products and goods (net value) 204,041 198,618 5,423
Advances 876 921 (45) ACCOUNTING STATEMENTS
TOTAL 445,921 404,713 41,208
Deferred tax assets and liabilities amounted to €74,033 thousand and €81,431 thousand, respectively, at 31 December > Balance Sheet
2021. Note 11.10 on income taxes provides further details. > Statement of Profit or Loss
Compared to the previous year, the inventory of raw materials increased primarily due to the green coffee compo-
nent. With reference to the Parent Company, this is mainly attributable to the increase in market prices recorded
during the 2021 financial year.
The increase in the net value of finished product inventories is mainly attributable to the increase in inventories
of capsules, packaged coffee and other food products (€11 million), offset by the reduction in the coffee machine NOTES TO THE FINANCIAL STATEMENTS
inventory (€6 million).
At 31 December 2021, inventories were shown net of the write-down provision amounting to €28.3 million set aside
for obsolete and slow-moving materials, with particular reference to coffee machines and related spare parts, ad- INDEPENDENT AUDITORS’ REPORT
vertising material, factory spare parts and packaging.

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10.10 Trade receivables 10.11 Current tax receivables

COMPANY OFFICERS
The following table provides a breakdown of the Group’s trade receivables at 31 December 2021 and at 31 December Current tax receivables include other tax receivables amounting to €3 million and tax receivables from parent com-
GROUP STRUCTURE
2020: panies amounting to €1.9 million.
31.12.2021 31.12.2020 CHANGES Receivables from parent companies refer to receivables claimed from the parent company, Finlav S.p.A. for IRES (cor- LETTER TO SHAREHOLDERS
Trade receivables <12 months 276,387 259,313 17,074 porate income tax) purposes by some Group companies participating in the national tax consolidation programme.
Other tax receivables refer to credits for income taxes claimed by other Group companies not participating in the DIRECTORS’ SINGLE REPORT
Provision for write-down of receivables (16,840) (16,198) (642)
Group’s national tax consolidation programme. ON OPERATIONS
Total trade receivables 259,547 243,115 16,432
Trade receivables are recognised net of deferred premiums and discounts to be settled. The increase in the year is in LAVAZZA GROUP
10.12 Cash and cash equivalents
line with the rise in Group’s turnover.
The following table provides the breakdown of receivables by maturity and the related write-down provision for the
years 2021 and 2020:
at 31 December 2021
Cash and cash equivalents at 31 December 2021 and 31 December 2020:
2021 2020
31.12.2021 31.12.2020 ACCOUNTING STATEMENTS
TRADE WRITE-DOWN TRADE WRITE-DOWN
RECEIVABLES PROVISION RECEIVABLES PROVISION Bank and post office deposits 633,809 338,855 > Consolidated Statement of Financial Position
FOR EXPECTED FOR EXPECTED
Bank deposits in foreign currencies 71,957 32,020
FUTURE LOSSES FUTURE LOSSES > Consolidated Statement of Profit or Loss
Cash and valuables on hand 796 949
Not yet due 232,281 (6,265) 224,131 (4,922) > Consolidated Statement of Comprehensive Income
TOTAL CASH AND CASH EQUIVALENTS 706,562 371,824
Less than 30 days 21,558 (1,041) 18,461 (779)
30-90 days 12,729 (1,779) 5,907 (1,667)
Within one year 4,473 (2,422) 6,787 (4,863)
Cash and cash equivalents consist of cash at bank and post-office accounts, as well as cash in hand and cheques > Consolidated Statement of Changes in Equity
held by logistic hubs, outside contractors and sales areas.
Within five year 4,506 (4,492) 4,025 (3,967)
Foreign currency accounts were approximately €72 million, chiefly in dollars, and were mainly attributable to the
Over five years 841 (841) - - Parent Company and regarded market purchases and collections of receivables from foreign customers located in NOTES TO THE CONSOLIDATED
Breakdown of receivables by maturity 276,387 (16,840) 259,312 (16,198) countries outside the Eurozone. These accounts are generally used to cover payments for the supply of green coffee
Write-down (16,840) (16,198) and for promotional activities in foreign markets.
Total 259,547 243,115 INDEPENDENT AUDITORS’ REPORT
Trade receivables do not bear interest, have an average maturity of 30 to 90 days and are tested for recoverability of
their value pursuant to IFRS 9. On the basis of the analyses carried out, the value of financial trade receivables was
adjusted to bring it into line with the presumable realisable value, as reported below. LUIGI LAVAZZA S.p.A.
Movements in the relevant provisions are reported in the following table: Financial Statements
at 31 December 2021
PROVISION FOR WRITE-DOWN OF RECEIVABLES, CURRENT
31.12.2020 (16,198)
> Balance Sheet
Provision for the year (6,156)
Uses 5,755 > Statement of Profit or Loss
Release to income - > Statement of Cash Flows
Adjustment for amounts in foreign currency (241)
Change in consolidation area and other changes -
31.12.2021 (16,840) NOTES TO THE FINANCIAL STATEMENTS
The provision for write-down of receivables, defined as per IFRS 9, include a provision of €6.1 million and uses INDEPENDENT AUDITORS’ REPORT
amounting to €5.7 million.

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Other comprehensive income components attributable to the

10.13 Share capital and reserves Parent Company’s shareholders, net of taxes
COMPANY OFFICERS
The changes in other components of comprehensive income at 31 December 2020 and 31 December 2021 were as
GROUP STRUCTURE
follows:
Share capital LETTER TO SHAREHOLDERS
CHANGES AT 31 DECEMBER 2020 CASH FLOW RESERVE RESERVE FOR RESERVE FOR TOTAL
At 31 December 2021 fully subscribed and paid-up share capital consisted of 25,000,000 ordinary shares, with a HEDGE OF FVOCI TRANSLATION ADJUSTMENTS DIRECTORS’ SINGLE REPORT
RESERVE FINANCIAL DIFFERENCES TO EMPLOYEE
nominal value of €1 each. ASSETS BENEFITS
ON OPERATIONS
Gains (losses) from the translation of
financial statements denominated in - - (49,444) - (49,444)
Treasury shares currencies other than the Euro LAVAZZA GROUP
Derivatives to hedge exchange-rate risk (8,983) - - - (8,983)
Treasury shares in portfolio amounted to 2,499,998 ordinary shares, with a nominal value of €1 each, accounting for Derivatives to hedge commodity risk (2,086) - - - (2,086) Consolidated Financial Statements
approximately 10% of share capital. No other Lavazza Group company owns Luigi Lavazza S.p.A. shares. Interest rate swaps 20 - - - 20
at 31 December 2021
Loss on AFS financial instruments - (3,774) - - (3,774)
Actuarial changes on pension plans - - - (2,316) (2,316)
Total (11,049) (3,774) (49,444) (2,316) (66,583)
Other capital reserves ACCOUNTING STATEMENTS
This item mainly includes the other reserves recognised in the financial statements of the Parent Company, which at
31 December 2021 were broken down as follows: CHANGES AT 31 DECEMBER 2021 CASH FLOW RESERVE RESERVE FOR RESERVE FOR TOTAL > Consolidated Statement of Profit or Loss
HEDGE OF FVOCI TRANSLATION ADJUSTMENTS
RESERVE FINANCIAL DIFFERENCES TO EMPLOYEE > Consolidated Statement of Comprehensive Income
31.12.2021 31.12.2020 CHANGES ASSETS BENEFITS
Re. Law 576/75 * 28 28 -
Gains (losses) from the translation of
Re. Law 72/83 ** 268 268 - > Consolidated Statement of Changes in Equity
financial statements denominated in - - 52,304 - 52,304
Re. Law 408/90 25,096 25,096 - currencies other than the Euro
Re. Law 413/91 5,681 5,681 - Derivatives to hedge exchange-rate risk 21,264 - - - 21,264
Re. Law 342/2000 *** 103,048 103,048 - Derivatives to hedge commodity risk 21,618 - - - 21,618 NOTES TO THE CONSOLIDATED
Re. Law 448/2001 5,100 5,100 - Interest rate swaps 4,183 - - - 4,183 FINANCIAL STATEMENTS
Re. Law 350/2003 **** 93,900 93,900 - Loss on AFS financial instruments - 6,655 - - 6,655
Re. Law 266/2005 70,400 70,400 - Actuarial changes on pension plans - - - 4,049 4,049
Re. Law 185/2008 58,200 58,200 -
Total 47,065 6,655 52,304 4,049 110,073
Total revaluation reserves 361,721 361,721 -
Legal reserve 5,000 5,000 -
Extraordinary reserve
Merger surplus reserve
211,519
56,953
203,611
56,953
7,908
-
The positive component of the cash flow hedge reserve of €47 million was mainly attributable to the revaluation of LUIGI LAVAZZA S.p.A.
the foreign exchange derivatives portfolio (resulting from the significant revaluation of the US Dollar against the
Reserve Re. Law 46/1982
Reserves Re. Law 488/1992
91
381
91
381
-
-
Euro) and the effect of the strategies to hedge the green coffee price risk that were implemented financially during Financial Statements
Other reserves 478 478 -
2021 (with a positive result dictated by the growing trend in market prices) and the economic effects of which, as a
result of the application of hedge accounting, are deferred in the 2022 financial year (in conjunction with the ac-
at 31 December 2021
Reserve arising on exchange gains - 7,908 (7,908)
counting recognition of the supplies hedged). ACCOUNTING STATEMENTS
Other reserves 274,422 274,422 -
TOTAL 636,143 636,143 - > Balance Sheet
* Due to the merger of Luca S.r.l. > Statement of Profit or Loss
** Due to the merger of Manifattura Rosy S.r.l. (€198,836) and Luca S.r.l. (€68,682).
*** Due to the merger of Mokapak S.r.l. (€5,111,146). DISTRIBUTIONS MADE AND PROPOSED
**** Due to the merger of Mokadec S.r.l. (€2,729,700) and Mokapak S.r.l. (€8,813,610).
During the year, the Parent Company distributed ordinary dividends in the amount of €33,075 thousand.
Proposed dividends on ordinary shares are subject to approval by the annual Shareholders’ Meeting. NOTES TO THE FINANCIAL STATEMENTS
No allocations were made to revaluation reserves and other reserves pending taxes, since to date they are not ex-
pected to be paid out. INDEPENDENT AUDITORS’ REPORT

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10.14 Financial liabilities, non-current and current

Financial liabilities due beyond one year are broken down as follows:
NON-CURRENT MATURITY MATURITY MATURITY MATURITY BEYOND

FINANCIAL 2023 2024 2025 2026 COMPANY OFFICERS
31.12.2021 31.12.2020 CHANGES LIABILITIES
GROUP STRUCTURE
Bank loans 453,817 309,308 144,509 Bank loans 454 155 60 120 119 -
Lease liabilities - - -
Payables for options on the purchase of
33 33 - - - -
investments
Payables for options on the purchase of investments 33,335 30,633 2,702 Payables for withholding on guarantees on the DIRECTORS’ SINGLE REPORT
- - - - - -
Derivatives and other hedging instruments 2,498 5,689 (3,191) purchase of investments
ON OPERATIONS
Debts to other lenders - - - - - -
Withholdings as guarantees for purchases of investments - - -
Other non-current financial liabilities - - - - - -
TOTAL NON-CURRENT FINANCIAL LIABILITIES 489,650 345,630 144,020
Total 487 188 60 120 119 - LAVAZZA GROUP
31.12.2021 31.12.2020 CHANGES
Other short-term bank payables 9,156 14,799 (5,643) Notes 10.21 and 10.22 provide further information on financial liabilities.
at 31 December 2021
Bank loans (current portion) 190,172 180,131 10,041
Payables to other lenders 113 619 (506)
Derivatives and other hedging instruments 1,588 14,619 (13,031) ACCOUNTING STATEMENTS
Other liabilities 3 6,062 (6,059) 10.15 Right-of-use liabilities, non-current and current > Consolidated Statement of Financial Position
TOTAL CURRENT FINANCIAL LIABILITIES 201,032 216,230 (15,198)
Non-current right-of-use liabilities amounted to €125.4 million, whereas current right-of-use were €17.5 million, of > Consolidated Statement of Comprehensive Income
which €4.5 million referring to the lease agreement for the Nuvola Headquarters.
Bank loans (current and non-current portion) referred to:
Right-of-use liabilities due after one year were broken down as follows: > Consolidated Statement of Changes in Equity
> the corporate loan contracted in 2016 for a term of five years (maturing in 2021), for an initial amount of €400
million, from a pool of four banks (club deal), bearing interest at a variable rate (six-month Euribor), subsequently NON- MATURITY MATURITY MATURITY MATURITY BEYOND
converted to a fixed rate by an interest rate swap transaction. During the year, the last accrued principal was duly CURRENT 2023 2024 2025 2026
LIABILITIES NOTES TO THE CONSOLIDATED
repaid in the amount of €65 million;
Lease liabilities for the Nuvola HQ 67 5 5 5 5 48 FINANCIAL STATEMENTS
> the corporate loan contracted in 2018 for a term of five years, for an amount of €400 million, from a pool of three Other right-of-use liabilities 58 11 8 6 5 28
banks (club deal), bearing interest at a variable rate (six-month Euribor). In the reporting year, accrued principal Other - - - - - -
was duly repaid for a total of €91 million; therefore, the outstanding residual debt at 31 December 2021 totalled Total 125 15 13 11 10 76
€309 million; also this loan was then converted to fixed rate through an interest rate swap;
> a corporate loan of €300 million relating to a corporate financing contract belonging to the sustainability-linked LUIGI LAVAZZA S.p.A.
loan category, taken out with a banking pool composed of 4 leading banking institutions in July 2021 that the
Company decided to fix through an interest rate swap contract. The start of the capital repayment period has been Financial Statements
set in 2024, while the loan is scheduled to expire in the 2026 financial year. The financing operation has been
correlated with sustainability targets, which are observed and measured annually and which allow reductions in
at 31 December 2021
interest pricing; ACCOUNTING STATEMENTS
> a hot money loan taken out by the Parent Company amounting to €20 million, partially repaid in 2022; > Balance Sheet

> a short-term loan taken out by the subsidiary Cofincaf S.p.A. in the amount of €15 million.
The outstanding loans are not subject to any covenants.
Payables for call options on investments relate to the amount payable in connection with the call option on the
residual non-controlling interest in Kicking Horse Coffee that in the year was adjusted to the related fair value, rec- NOTES TO THE FINANCIAL STATEMENTS
ognising a €2.7 million increase in debt compared to the previous year.

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10.16 Provisions for employee benefits

COMPANY OFFICERS
GROUP STRUCTURE
SEVERANCE PROVISIONS FOR TOTAL PROVISIONS FOR Other benefits include the adjustment of the employee benefit provision based on the new parameters of the French
INDEMNITIES PENSIONS AND SIMILAR EMPLOYEE BENEFITS subsidiary Carte Noire SA. Other changes include the effect of the application for French companies of the recom- LETTER TO SHAREHOLDERS
OBLIGATIONS
mendation issued in May 2021 concerning IAS 19 whereby the pensions benefit is calculated using only the number
Balance at 31.12.2020 25,562 64,191 89,753
of consecutive years of service with the company immediately before retirement age. The impact of this regulatory DIRECTORS’ SINGLE REPORT
Increases 5,668 1,491 7,159 change on the 2021 financial year was recognised in retained earnings. ON OPERATIONS
Uses (4,752) (5,043) (9,795)
Other (1,183) - (1,183) The main assumptions adopted in determining the obligations arising from the employee termination indemnities
Exchange rate delta 8 - 8 of the Italian companies are set out below. LAVAZZA GROUP
Changes in consolidation area - - -
Balance at 31.12.2021 25,303 60,639 85,942
EMPLOYEE TERMINATION INDEMNITIES 2021
ASSUMPTIONS at 31 December 2021
Discount rate AA euro composite curve at 31 December 2021
Severance indemnities include employee termination indemnities for the Group's employees, pursuant to Article
2120 of the Italian Civil Code, which fall within the scope of application of IAS 19, and other similar employee pro- Personnel turnover rate 1.3 % - 4%
visions of international subsidiaries. Expected inflation rate 1.50% ACCOUNTING STATEMENTS
Employee termination indemnities accrued up to 31 December 2006 remained with the Company; employee termi- > Consolidated Statement of Financial Position
nation indemnities accrued from 1 January 2007, at the employee’s discretion, have been allocated to supplementary
pension schemes or kept with the Company, which has transferred the indemnities to the Treasury Fund established The following is a summary of the quantitative sensitivity analysis for the significant assumptions adopted at > Consolidated Statement of Profit or Loss
by the INPS. Accordingly, the employee termination indemnities accrued since 1 January 2007 are classified as 31 December 2021. > Consolidated Statement of Comprehensive Income
defined benefit plans. Since the Group fulfils its obligation by paying contributions to a separate entity (a fund),
CHANGE INVESTIGATED IMPACT OF INCREASE IMPACT OF DECREASE > Consolidated Statement of Cash Flows
without additional obligations, the entity recognises the contributions to the fund on an accrual basis, correspond-
ing to the employment services rendered by the employees, without performing any actuarial calculations. Since Discount rate 25,303 23,914 23,432 > Consolidated Statement of Changes in Equity
on the reporting date the Group had already paid the contributions in question, no liabilities have been recognised. Personnel turnover rate 25,303 25,096 25,608
On the other hand, employee termination indemnities accrued up to 31 December 2006 continue to be classified as
Expected inflation rate 25,303 25,678 24,935
defined-benefit plans, maintaining the actuarial measurement criteria, in order to express the present value of the NOTES TO THE CONSOLIDATED
benefit due upon severance, accrued to the employees at 31 December 2006.
Provisions for pensions and similar obligations primarily refer to Lavazza Professional Germany G.m.b.H.
The sensitivity analyses set out above were conducted on the basis of a method for extrapolating the impact on the INDEPENDENT AUDITORS’ REPORT
The following tables present a summary of the net cost components of the benefits taken to the statement of profit obligation of reasonable changes in the key assumptions in place on the reporting date.
or loss and the statement of comprehensive income in 2021 in connection with employee termination indemnities
and similar items. EXPECTED FUTURE PAYMENTS 2021
Within 12 months 1,756

Liabilities (assets) at 1 January 2021 25,562 From 1 to 4 years 4,531
Amounts included in the statement of profit or loss: Beyond 4 years 38,859
Current service costs 796 Total 45,146
Net interest (24) at 31 December 2021
Other services 2,835
Total 3,607 The expected cash flows for future payments under the plan are not sufficient to have a significant impact on the
Group's financial position and cash flow situation. > Balance Sheet
Amounts included in the statement of comprehensive income:
Profit (losses) from changes in actuarial assumption (643)
Total (643) > Statement of Cash Flows
Other movements:
Benefits paid (1,405)
Benefits transferred - NOTES TO THE FINANCIAL STATEMENTS
Curtailment (631) STATUTORY AUDITORS’ REPORT
Exchange-rate delta and change in consolidation scope (1,187)
Total (3,223)
Liabilities (assets) at 31 December 2021 25,303
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The main assumptions adopted in determining the obligations arising from pension funds and similar obligations Other provisions for non-current future risks and charges of €98 million include:
were essentially due to Lavazza Professional Germany G.m.b.H.:
> provisions for risks and charges relating to the Parent Company totalling €30.6 million, including provisions
ASSUMPTIONS FOR PENSIONS 2021 for industrial production conversion projects to obtain sustainable packaging amounting to €20.5 million. The COMPANY OFFICERS
AND SIMILAR OBLIGATIONS
Group is committed to ensuring high product quality standards, in compliance with the essential requirements of
GROUP STRUCTURE
Interest rate 1.31% environmental directives and new technologies, adopting processes and raw materials with a low environmental
Salary growth rate 2.00% impact to reduce waste production. During the year, the provisions were used for the scrapping of production lines LETTER TO SHAREHOLDERS
Expected inflation rate 4.00% of plastic capsules replaced by the new aluminium pods with zero environmental impact. The provisions relating
to the Parent Company also include provisions to cover the recoverability risks for investments made in the café DIRECTORS’ SINGLE REPORT
Expected mortality rate RT 2018G
and restaurant channel and other commercial risks amounting to a further €10.1 million. ON OPERATIONS
The aforementioned sales channels, affected in the previous year by the restrictive measures to combat the
ASSUMPTIONS FOR PENSIONS CHANGE IMPACT OF IMPACT OF Covid-19 pandemic, during the year showed a recovery, albeit slow and gradual, necessitating a partial release
AND SIMILAR OBLIGATIONS INVESTIGATED INCREASE DECREASE of the provisions; LAVAZZA GROUP
Interest rate
Salary growth rate
55,619
55,619
50,776
56,120
55,619
55,619
> provisions for risks and charges of €55 million relating to personnel, allocated by the Parent Company for Consolidated Financial Statements
Expected inflation rate 55,619 59,293 55,619
medium-term bonuses and incentives for employees;
at 31 December 2021
Expected mortality rate 55,619 57,270 55,619 > provisions allocated for risks relating to tax litigation amounting to €4 million (of which €1 million for Parent
Company VAT disputes);
> provisions for charges relating to industrial reorganisations of other group companies amounting to approxi- > Consolidated Statement of Financial Position
10.17 Provisions — non-current and current

mately €8 million.
Provisions for current risks and charges mainly include staff bonuses and benefits payable in the following year as > Consolidated Statement of Comprehensive Income
well as charges arising from reorganisation and rationalisation of the Parent Company's production system.
The following table provides information on the movements of provisions at 31 December 2021: Reclassifications of the non-current portion refer mainly to the allocation to write-down of tangible fixed assets and
to the write-down of inventory for provisions made in previous years. > Consolidated Statement of Changes in Equity
31.12.2020 PROVISIONS USES RECLASSIFICATION EXCHANGE CHANGE IN 31.12.2021 Reclassifications of the current portion refer to a more correct representation of liabilities with regard to employees
RATE DELTA CONSOLIDATION classified as payables to personnel in the previous year.
AREA
Provision for litigations 14,636 5,528 (3,070) - 3 - 17,097

Provision for agents' FINANCIAL STATEMENTS
customer 3,226 487 (768) - - - 2,945
compensation
Provision for product
6,059 2,851 (68) - 21 - 8,863
10.18 Current tax payables
warranty
Other provisions - liabilities 70,390 45,397 (13,654) (4,159) 69 - 98,043
Provisions for future risks Current tax payables amounted to €14.5 million and include tax payables to parent companies of €10.1 million and
94,311 54,263 (17,560) (4,159) 93 - 126,948
and charges (non current) other tax payables amounting to €4.4 million.
Provisions for bonuses
Payables to the parent companies refer to the receivables claimed from the parent company, Finlav S.p.A., for IRES
and employee benefits to
be paid
18,822 20,229 (14,061) 1,212 236 - 26,438
(corporate income tax) purposes by Group companies participating in the national tax consolidation programme. Financial Statements
Other provisions 9,200 4,433 (6,582) - 72 - 7,123
at 31 December 2021
Provisions (current) 28,022 24,662 (20,643) 1,212 308 - 33,561
The provision for litigation also refers to labour law disputes and was recognised to account also for risks relating 10.19 Trade payables > Balance Sheet
to labour legal or contractual obligations associated with situations that already existed at the reporting date, but > Statement of Profit or Loss
that were characterised by a state of uncertainty and the outcome of which depends on the occurrence of one or
more future events. During the year, the provision was increased to cover potential litigation risks with customers The item amounted to €413 million and primarily referred to payables for the supply of raw materials and services
and distributors; the utilisation refers instead to the settlement of legal and settlement expenses incurred in the year due within one year.
but related to disputes arising in previous years.
The provision for supplementary agents’ customer compensation, created for agents in the event of retirement or NOTES TO THE FINANCIAL STATEMENTS
interruption of contract due to principal, was also adjusted.
Movement in the provision for product warranty of approximately €2.8 million allocated by the Parent Company
refers mainly to coffee machine warranties and returns. INDEPENDENT AUDITORS’ REPORT

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10.20 Other non-current and current liabilities 10.21 Financial instruments – additional information
COMPANY OFFICERS
31.12.2021 31.12.2020 CHANGES The carrying amounts of the individual categories of financial assets and liabilities held by the Group at 31 December
GROUP STRUCTURE
OTHER NON-CURRENT LIABILITIES 1,310 2,034 (724) 2021 and 31 December 2020, revised according to the classification rules set out in IFRS 7 – Financial Instruments:
VAT payables 3,582 24,525 (20,943) Disclosures, are presented below. LETTER TO SHAREHOLDERS
Withholdings to be paid as withholding agents 4,645 4,613 32 MEASUREMENT AT MEASUREMENT AT FV MEASUREMENT AT FV DIRECTORS’ SINGLE REPORT
Other miscellaneous tax payables <12 5,438 5,044 394 AMORTISED COST THROUGH PROFIT OR THROUGH OCI
LOSS ON OPERATIONS
Total other current tax payables 13,665 34,182 (20,517)
Advances 26,981 25,635 1,346 2021 2020 2021 2020 2021 2020
LAVAZZA GROUP
Payables to social security institutions <12 12,233 12,408 (175)
Operating assets
Payables to personnel 28,773 26,835 1,938
Cash and cash equivalents 706,562 371,824 - - - -

Payables to shareholders and bondholders 512 589 (77)
Trade receivables 259,547 243,115 - - - -
Other payables to third parties 854 2,007 (1,153)
Other current assets (excluding tax receivables) 43,478 39,643 - - - -
Total other current payables 69,353 67,474 1,879 Other non-current assets (excluding tax
4,056 4,298 - - - -
at 31 December 2021
14 month salary and holiday leave
th
3,590 3,738 (148) receivables)
Other operating accrued expenses 39 (3) 42 Non-current financial assets
Total accruals 3,629 3,735 (106) Financial receivables 11,524 20,773 - - - -
Deferred lease liabilities 294 341 (47) Mutual funds - - 1,630 2,067 - -
Other deferred income 6,523 5,157 1,366 Insurance policies - - 18,499 18,288 - - > Consolidated Statement of Financial Position
Total deferred income 6,817 5,498 1,319 Derivatives and other hedging instruments - - - - 2,185 4,879
OTHER CURRENT LIABILITIES 93,464 110,889 (17,425) Current financial assets
Financial receivables 111,083 187,959 - - - - > Consolidated Statement of Comprehensive Income
Derivatives and other hedging financial
- - - - 16,499 27,745 > Consolidated Statement of Cash Flows
instruments
Advances refer primarily to security deposits and advance payments received from the subsidiary Nims S.p.A. upon Equity securities - - 21,351 7,730 - - > Consolidated Statement of Changes in Equity
the signing of the supply/sale contract by the end client. Bonds - - 227,962 168,709 - -
Mutual investment funds - - 1104 552 - -
Other current securities - - 19 17 - -
Investments in other companies - - 13,549 11,195 13,049 6,394
Operating liabilities
Trade payables 412,932 329,279 - - - - INDEPENDENT AUDITORS’ REPORT
Other current liabilities (excluding tax liabilities) 79,799 76,707 - - - -
Other non-current liabilities (excluding tax
1,310 2,034 - - - -
liabilities)
Non-current financial liabilities
Bank loans 453,817 309,308 - - - - LUIGI LAVAZZA S.p.A.
Finance lease liabilities - - - - - -
Right-of-use liabilities, non current 125,478 127,841 - - - - Financial Statements
at 31 December 2021
Payables for options on the purchase of
- - 33,335 30,633 - -
investments
Derivatives and other hedging instruments - - - - 2,498 5,689
Current financial liabilities ACCOUNTING STATEMENTS
Other short-term bank payables 9,156 14,799 - - - - > Balance Sheet
Bank loans (current portion) 190,172 180,131 - - - -
Right-of-use liabilities, current 17,486 17,057 - - - - > Statement of Profit or Loss
Payables to other lenders 113 619 - - - - > Statement of Cash Flows
Derivatives and other hedging instruments - - - - 1,588 14,619
Other liabilities 3 6,062 - - - -


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Detailed information on derivatives is provided here below. FINANCIAL DERIVATIVE LIABILITIES
The item includes the negative fair values of the derivative instruments outstanding as at 31 December 2021.
Financial derivatives The Group is exposed to fluctuations in foreign exchange rates in particular with regard to the purchase of green COMPANY OFFICERS
coffee denominated in USD and sales in countries with currencies other than the Euro. In order to reduce the impact
GROUP STRUCTURE
The Group is exposed to fluctuations in foreign exchange rates, in particular in respect of the purchase of green of changes in foreign exchange rates on expected cash flows, in accordance with its risk management policy the
coffee denominated in USD and sales in countries with currencies other than the Euro. In order to reduce the impact Group has recourse to derivative instruments for hedging purposes. LETTER TO SHAREHOLDERS
of changes in exchange rates on expected cash flows, in accordance with its risk management policy the Group uses The price of green coffee is subject to considerable volatility caused by both variables relating to physical supply
derivative instruments solely for hedging purposes. and demand mechanisms (harvest, stocks, consumption and logistical limitations) and speculative activity on the DIRECTORS’ SINGLE REPORT
exchanges. ON OPERATIONS
In order to limit the impact of fluctuations in coffee prices, the Group adopts procurement policies that aim to reduce
price changes, while also undertaking hedging transactions through financial derivatives, as established by its risk
FINANCIAL DERIVATIVE ASSETS management policy. LAVAZZA GROUP
The Group also had recourse to financial derivatives (interest rate swaps) to transform the rate on the corporate
loan, commented upon in the section regarding amounts due to banks, from variable to fixed to hedge against the Consolidated Financial Statements
NON-CURRENT DERIVATIVE ASSETS risk of fluctuation in the relevant interest rates.
at 31 December 2021
The item includes the positive fair value of outstanding derivatives at 31 December 2021 with a duration in excess of The following tables summarise the related amounts (€ thousand):
12 months, contracted in order to hedge against foreign exchange and commodities risk.
The following table summarises the related amounts (€ thousand): NON-CURRENT DERIVATIVE LIABILITIES > Consolidated Statement of Financial Position

2021 2020
2021 2020 > Consolidated Statement of Comprehensive Income
NOTIONAL VALUE FAIR VALUE NOTIONAL VALUE FAIR VALUE
Commodities - Purchase of green coffee - - 23 23 > Consolidated Statement of Cash Flows
Exchange rates - Sales 72,380 221 25,444 194
Exchange rates - Sales 2,302 22 65,751 4,856
Exchange rates - Loans 17,851 6 - -
Exchange rates - Loans 300,000 2,163 - -
Interest rates - Loans 310,000 2,271 465,000 5,495
Total 302,302 2,185 65,774 4,879 Total 400,231 2,498 490,444 5,689
CURRENT DERIVATIVE LIABILITIES
CURRENT DERIVATIVE ASSETS 2021 2020 INDEPENDENT AUDITORS’ REPORT
The item includes the positive fair value of outstanding derivatives at 31 December 2021 with a duration of less than
12 months, contracted in order to hedge against foreign exchange and commodities risks. Commodities - Purchase of green coffee 37,695 714 9,495 86
Exchange rates - Sales - Purchase of green coffee 91,114 874 385,997 14,533
The following table summarises the related amounts for the reporting year (€ thousand): Total 128,810 1,588 395,492 14,619 LUIGI LAVAZZA S.p.A.
2021 2020 Financial Statements
NOTIONAL VALUE FAIR VALUE NOTIONAL VALUE FAIR VALUE at 31 December 2021
Commodities - Purchase of green coffee 2,516 188 91,555 14,391
Exchange rates - Sales - Purchase of green coffee 329,750 16,311 133,650 906
Exchange rates - Other financial assets - - 115,076 12,448
> Balance Sheet
Total 332,266 16,499 340,281 27,745 > Statement of Profit or Loss

With regard to the exchange rate hedging of other financial assets, it should be noted
that during the year the forward contracts for the purchase of USD by Lavazza Capital
S.r.l. were terminated, at the same time as the closure of the related underlying cur- NOTES TO THE FINANCIAL STATEMENTS
rency tied deposits

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10.22 Fair value measurement 10.23 Government grants

COMPANY OFFICERS
The following table provides the fair value measurement hierarchy of the Group’s assets and liabilities for the cur- The amounts taken to the statement of profit or loss during the year on an accrual basis are presented below, broken
GROUP STRUCTURE
rent and previous years. down into grants towards operating expenses and capital grants.
Capital grants were received in previous years and the accrued portions were recognised during the year. LETTER TO SHAREHOLDERS
In the previous year, capital grants included grants for Covid-19-related expense.
2021 2020 DIRECTORS’ SINGLE REPORT
QUOTED SIGNIFICANT SIGNIFICANT QUOTED SIGNIFICANT SIGNIFICANT OPERATIONAL GRANTS ON OPERATIONS
PRICES IN OBSERVABLE UNOBSERVABLE PRICES IN OBSERVABLE UNOBSERVABLE
ACTIVE INPUTS INPUTS ACTIVE INPUTS INPUTS AMOUNT RECEIVED
MARKETS MARKETS
R&D Bonus 1,095
LAVAZZA GROUP
(LEVEL 1) (LEVEL 2) (LEVEL 3) (LEVEL 1) (LEVEL 2) (LEVEL 3)
Investments in other
13,049 13,549 - 6,394 11,195 -
Grants for investments in photovoltaic or for other energy production systems 285 Consolidated Financial Statements
at 31 December 2021
companies Government grants to internationalization or export 15
Mutual funds 2,734 - - 2,619 - -
Grants for training programme 86
Insurance policies - 18,499 - - 18,288 -
Other 15
Equity securities 21,351 - - 7,730 - -
Total 1,500
Bonds 227,962 - - 168,709 - - ACCOUNTING STATEMENTS
Other current securities - 19 - - 17 -
Derivative assets - 18,684 - 6,006 26,618 - > Consolidated Statement of Financial Position
CAPITAL GRANTS
Payables for options on the
- - 33,335 - - 30,633 > Consolidated Statement of Profit or Loss
purchase of investments AMOUNT RECEIVED
Derivative liabilities - 4,086 - - 20,308 - > Consolidated Statement of Comprehensive Income
Government grants for innovation and the acquisition of new equipment 418
Benefits on expenditures in specific geographical areas 233 > Consolidated Statement of Cash Flows
There were no transfers between Level 1 and Level 2 during the year. R&D Bonus 270 > Consolidated Statement of Changes in Equity
Other 220
Total 1,142
10.24 Contractual assets and liabilities

With reference to contractual assets and liabilities, it should be noted that they almost entirely refer to trade receiv-
ables, with the exception of contractual liabilities arising on advances from customers totalling €26 million, mainly Financial Statements
received by the subsidiary Nims S.p.A.
at 31 December 2021
> Balance Sheet


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11. Consolidated Statement 11.2 Cost of sales

of Profit or Loss This item includes the following costs:
COMPANY OFFICERS
GROUP STRUCTURE
YEAR 2021 YEAR 2020 CHANGE LETTER TO SHAREHOLDERS
Material and production costs (1,233,276) (1,132,495) (100,781)
Logistic and distribution costs (106,314) (88,198) (18,116)
Effects of Covid-19 Fees and commissions on sales (46,175) (44,188) (1,987)
ON OPERATIONS
TOTAL (1,385,765) (1,264,881) (120,884)
The data and results presented in these Notes to the Financial Statements have been significantly influenced by the
effects of the pandemic event that continued through 2021. LAVAZZA GROUP
The rise compared to the previous year was primarily due to the increase in sales. The impact in respect of turnover
remains constant (60%), despite the increase in market prices of raw materials recorded during the year but not yet Consolidated Financial Statements
reflected in the statement of profit and loss. In fact, the cost of sales includes the positive effects of previous year
prices.
at 31 December 2021
11.1 Revenue from contracts with customers The following table provides a breakdown of costs by nature:
YEAR 2021 YEAR 2020 CHANGE
This item is broken down as follows: Purchase of raw materials and third-party products (990,232) (919,583) (70,649)
Change in inventories 55,301 37,927 17,374 > Consolidated Statement of Profit or Loss
YEAR 2021 YEAR 2020 CHANGE Costs for services (278,489) (236,021) (42,468) > Consolidated Statement of Comprehensive Income
Net revenues from the sale of goods 2,257,635 2,037,820 219,815 Costs for use of third-party assets (2,526) (2,056) (470)
Personnel costs (55,608) (54,637) (971)
Net revenues from the sale of services 50,758 47,438 3,320
TOTAL 2,308,393 2,085,258 223,135 Amortisation, depreciation and write-downs (91,219) (87,413) (3,806) > Consolidated Statement of Changes in Equity
Provisions for risks (22,992) (3,098) (19,894)
TOTAL (1,385,765) (1,264,881) (120,884)
The following table provides a breakdown of sales by geographical area: NOTES TO THE CONSOLIDATED
GEOGRAPHIC AREA YEAR 2021 RATIO % YEAR 2020 RATIO % CHANGE % CHANGE
Provisions for the year of €22.9 million include €15 million attributable to the Parent Company, of which €12.1 mil-
Italy 671,167 29.1% 630,195 30.2% 40,972 6.5% lion to support industrial production conversion projects for the production of sustainable packaging. In fact, the INDEPENDENT AUDITORS’ REPORT
Other EU countries 1,190,274 51.6% 1,046,096 50.2% 144,178 13.8% Company is committed to ensuring high product quality standards, in compliance with the essential requirements
Non-EU countries 446,952 19.4% 408,967 19.6% 37,986 9.3% of environmental directives and new technologies, adopting processes and raw materials with low environmental
Total 2,308,393 100.0% 2,085,258 100.0% 223,136 10.7% impact to reduce waste production. The remaining portion of €7.9 million relates to provisions for charges related to
industrial restructuring of other Group companies.
Costs for services rose as a result of the increase in market costs related to transport, logistics and ancillary produc- LUIGI LAVAZZA S.p.A.
Net revenue from the sale of goods mainly refer to the sale of packaged coffee and capsules and is given net of dis- tion costs (utilities, external processing, maintenance of plants and machinery, other industrial services).
counts and grants for promotional activities granted to customers and referring to activities not related to products Financial Statements
or services that can be separated from the main sale transaction.
at 31 December 2021
Net revenue from the sale of services, transferred over a specific time period, refer to: ACCOUNTING STATEMENTS
REVENUE RECOGNITION TIMING YEAR 2021 YEAR 2020 CHANGE > Balance Sheet
Lease of coffee machines provided on free loan for use 41,477 38,360 3,117 > Statement of Profit or Loss
Other services 3,662 4,107 (445)
Other rentals 5,619 4,971 648 > Statement of Cash Flows
TOTAL 50,758 47,438 3,320


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11.3 Promotional and advertising costs 11.5 General and administrative expenses
COMPANY OFFICERS
This item includes the following costs: YEAR 2021 YEAR 2020 CHANGE
GROUP STRUCTURE
Personnel costs (167,562) (161,642) (5,920)
Costs for services (39,951) (36,966) (2,985)
Advertising costs (118,148) (93,593) (24,555) Advisory services (33,016) (27,610) (5,406) DIRECTORS’ SINGLE REPORT
Promotional costs (64,038) (52,488) (11,550)
Costs for use of third-party assets (9,365) (9,206) (159)
Marketing costs (47,806) (39,170) (8,636) ON OPERATIONS
Amortisation and depreciation (31,658) (30,339) (1,319)
TOTAL (229,992) (185,251) (44,741)
Other costs (7,238) (6,313) (925)
LAVAZZA GROUP
Remuneration to Directors and Statutory Auditors (2,529) (2,469) (60)
Purchase of third-party products (619) (705) 86
Promotional and advertising costs increased by approximately €45 million, of which €25 million related to the in-
crease in advertising costs due to the resumption of activities that had slowed down during the previous year due to
Change in inventories
TOTAL
(649)
(292,587)
(608)
(275,858)
(41)
(16,729)
the pandemic.
at 31 December 2021
The following table provides a breakdown by nature: The item general and administrative expenses includes all structure costs referring to the Lavazza Group’s compa-
nies and related to the personnel management, legal, administration, finance and control, general management,
YEAR 2021 YEAR 2020 CHANGE general services and IT systems functions. ACCOUNTING STATEMENTS
Purchase of third-party products (1,107) (818) (289) General and administrative expenses rose by about €17 million, chiefly due to the increase in personnel costs, advi- > Consolidated Statement of Financial Position
Change in inventories (6,703) (5,783) (920) sory services and costs for services.
Costs for services (220,647) (176,430) (44,217) > Consolidated Statement of Profit or Loss
Costs for use of third-party assets (118) (97) (21) > Consolidated Statement of Comprehensive Income
Personnel costs - (12) 12
11.6 Research and development costs
Amortisation and depreciation (1,089) (1,065) (24)
Other costs (328) (1,046) 718 > Consolidated Statement of Changes in Equity
TOTAL (229,992) (185,251) (44,741)

Costs for services, net of grants received (11,802) (11,715) (87)
11.4 Selling costs Purchase of materials
Change in inventories
(201)
(1,163)
(447)
(709)
246
(454) INDEPENDENT AUDITORS’ REPORT
Other costs (313) (120) (193)
Amortisation and depreciation (2,308) (2,050) (258)
This item mainly includes costs of the commercial structure and the selling network.
TOTAL (15,787) (15,041) (746)
The following table provides a breakdown by nature: LUIGI LAVAZZA S.p.A.

YEAR 2021 YEAR 2020 CHANGE Research and development costs amounted to about €16 million, essentially in line with the previous year. Research Financial Statements
Purchase of third-party products (2,406) (4,061) 1,655 and development activities are mainly carried out and paid for by the Parent Company. In line with the previous
year, development and implementation of new food products and coffee machines, as well as of compostable and
at 31 December 2021
Change in inventories (1,549) (1,318) (231)
Costs for services and other costs (37,006) (35,629) (1,377) recyclable packages for capsules and Roast&Ground products continued. The Report on Operations provides further ACCOUNTING STATEMENTS
Costs for use of third-party assets (3,259) (3,112) (147)
details on the activities carried out.
> Balance Sheet
Personnel costs (126,514) (119,503) (7,011)
Write-down of receivables (6,156) (8,611) 2,455
Amortisation and depreciation (6,229) (5,271) (958) > Statement of Cash Flows
Provisions for risks (134) (440) 306
TOTAL (183,253) (177,945) (5,308)
Selling costs rose by €5,309 thousand mainly due to the increase in personnel costs, which represent the most sig-
nificant component, partially offset by a lower bad debt provisions compared to the previous year. INDEPENDENT AUDITORS’ REPORT

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11.7 Other operating (expense) income and 11.8 Personnel expenses

other one-off charges COMPANY OFFICERS
Personnel expenses include salaries, related contributions, portions of defined benefit plans and other costs, includ-
GROUP STRUCTURE
ing provisions for bonuses and incentives accrued in the reporting year.
11.7.1 Other operating (expense) income DIRECTORS’ SINGLE REPORT
Wages and salaries (259,398) (252,574) (6,824)
Social security contributions (55,921) (51,993) (3,928) ON OPERATIONS
Other operating (expense) income is broken down as follows: Costs for defined benefit plans (12,729) (12,643) (86)
Other costs (24,833) (20,347) (4,486)
YEAR 2021 YEAR 2020 CHANGE Total personnel costs (352,881) (337,557) (15,324) LAVAZZA GROUP
Royalties 984 1,319 (335) of which:
Insurance reimbursements 718 299 419 - included in cost of sales (55,608) (54,637) (971) Consolidated Financial Statements
Capital gains (losses)
Socially beneficial and charitable expense
(131)
(10,196)
(1,210)
(4,757)
1,079
(5,439)
- included in selling costs (126,514) (119,503) (7,011) at 31 December 2021
- included in other structure costs (170,759) (163,417) (7,342)
Amortisation and depreciation (16,498) (19,413) 2,915
Total personnel costs (352,881) (337,557) (15,324)
Provisions (5,405) (15,725) 10,320
Impairment of property, plant and equipment (2,542) (6,146) 3,604 ACCOUNTING STATEMENTS
Personnel costs (2,884) (1,105) (1,779) Personnel expenses amounted to €353 million, up €15 million compared to the previous year. > Consolidated Statement of Financial Position
Other income (expense) 4,218 2,665 1,553 The increase is linked to the normal salary review dynamics and to the policies of recruiting increasingly qualified
TOTAL (31,736) (44,073) 12,337 personnel to support priority projects for the business and to strengthen staff function skills. > Consolidated Statement of Profit or Loss
Moreover, thanks to the positive result achieved in 2021 and in line with a remuneration policy focused on merit and > Consolidated Statement of Comprehensive Income
the enhancement of resources, the costs relating to employee bonuses and benefits were significantly higher than
The item amounted to €32 million and includes amortisation and depreciation (€16 million), mainly referring to the in 2020.
Carte Noire and Merrild expertise acquired in the previous years and amortised based on a useful life of 20 years, > Consolidated Statement of Changes in Equity
in addition to the amortisation of trademarks, expertise and client portfolio acquired at the end of 2018 with the Average headcount, broken down by category, is set out in the table below:
Lavazza Professional business unit.
Socially beneficial and charitable expenses concern the recurring donations to non-profit organisations and recog- NOTES TO THE CONSOLIDATED
nised bodies, in support of social, health and cultural projects. CATEGORIES 2021 2020
It should be noted that a donation of €8 million provided continued support for projects of the non-profit Giuseppe Senior managers - Middle managers 983 971
and Pericle Lavazza foundation, which has always been active in promoting and implementing economic, social and Specialised workers 2,138 1,994 INDEPENDENT AUDITORS’ REPORT
environmental sustainability projects in favour of coffee-growing communities all over the world.
Other workers 999 1,188
Provisions amounted to €5 million and mainly refer to provisions for litigation.
Total 4,120 4,153
Impairment of property, plant and equipment amounted to €2.5 million and mainly refer to the Parent Company,
particularly regarding Buildings and other non-industrial or disused fixed assets
The following table shows the headcount at year-end and for the previous year:
11.7.2 Other one-off charges CATEGORIES 2021 2020
at 31 December 2021
Senior managers - Middle managers 993 974
The previous year, these charges amounted to €13.5 million, mainly for donations supporting local projects for the Specialised workers 2,151 2,105 ACCOUNTING STATEMENTS
healthcare system, schools and vulnerable groups following the health emergency linked to the Covid-19 pandemic.
Other workers 1,025 1,093 > Balance Sheet
In 2021, no specific Covid-19-related donations were made.
Total 4,169 4,172

11.7.3 Profit (loss) from investments in Joint Ventures
This item refers to the economic effect arising on the adjustment to equity of the interest in Y&L Coffee Ltd, a Chinese
company 35% held by the Group, and of the interest in Manufacture de Café, a 50% held company. NOTES TO THE FINANCIAL STATEMENTS

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11.9 Financial income and expense,

dividends and investments results COMPANY OFFICERS
GROUP STRUCTURE
Financial income and expense DIRECTORS’ SINGLE REPORT

ON OPERATIONS
The following table reports the breakdown of financial income and expense for 2021 and the previous year: Interest income from banks mainly refers to interest accrued on current accounts included in the Group’s cash and
cash equivalents.
YEAR 2021 YEAR 2020 CHANGE Interest income from financial receivables mainly refers to interest accrued on loans granted to clients by the sub- LAVAZZA GROUP
FV adjustments of securities in profit or loss 4,646 1,449 3,197 sidiary Cofincaf S.p.A.
Income (expense) from derivatives (7,271) 19,298 (26,569) Interest paid to banks mainly refers to interest accrued on corporate loans taken out by the Parent Company. Consolidated Financial Statements
at 31 December 2021
Exchange gains (losses) 12,314 (29,907) 42,221 The “Other financial expense” item refers to the accrued interest paid on right-of-use liabilities, including interest
Other financial income (expense) (9,518) (9,574) 56 accrued on the Nuvola Headquarters finance lease. It also includes the adjustment of the option right relating to the
TOTAL 171 (18,734) 18,905
Kicking Horse acquisition that resulted in a financial expense of €2.7 million during the year.
Income (expense) from derivatives includes fair value change differences on purchases and sales currencies > Consolidated Statement of Financial Position
changes of derivatives recognised through profit or other than the local currency of the consolidated com- Dividends and equity investments results
loss when they do not meet all hedge accounting con- panies (mainly effects linked to the dollar) at the spot > Consolidated Statement of Profit or Loss
ditions as per IFRS 9. exchange rate at year-end. The remaining portion of This item amounted to €237 thousand and refers to dividends on investments on equity securities held by Lavazza > Consolidated Statement of Comprehensive Income
exchange differences arose on purchases and sales in Capital S.r.l.
Income (expense) from financial derivatives refer to the foreign currencies.
ineffective component of the derivatives contracted to > Consolidated Statement of Changes in Equity
hedge against foreign exchange, interest rate and com- The favourable performance of the dollar and the ef-
11.10 Income taxes

modity risks and subject to hedge accounting, since fective hedging of derivative instruments, as well as
they met all the conditions for the hedge accounting the fair value adjustment of financial assets contribut- NOTES TO THE CONSOLIDATED
treatment of derivatives. ed to a significant improvement in financial income and
expenses compared to the previous year.
Exchange gains amounted to about €12.3 million and Income taxes for the years ended 31 December 2021and 2020 were broken down as follows: INDEPENDENT AUDITORS’ REPORT
refer for about 12.5 million to realised foreign ex-
Current taxes (52,392) (46,892) (5,500)

Use (provision) for deferred tax liabilities (10,780) 22,227 (33,007)
Other financial income and expense were broken down as follows: Provision (use) for deferred tax assets 4,709 8,458 (3,749)
OTHER FINANCIAL INCOME YEAR 2021 YEAR 2020 CHANGE

TOTAL (58,463) (16,207) (42,256)
Other financial income 2,263 3,733 (1,470) at 31 December 2021
Interest income from banks 928 1,476 (548)
Current taxes increased compared to the previous year, due to the higher result for the year. ACCOUNTING STATEMENTS
Interest income on financial receivables 1,487 1,949 (462) In relation to deferred taxes, the main changes compared to the previous year are attributable to:
Total financial income 4,678 7,158 (2,480) > Balance Sheet
> the effect of the release of deferred tax liabilities following the revaluation of Lavazza S.p.A. industrial assets > Statement of Profit or Loss
OTHER FINANCIAL EXPENSE YEAR 2021 YEAR 2020 CHANGE
carried out in 2020 pursuant to Legislative Decree 104/2020 amounting to approximately €16 million;
Interest and financial charges paid to banks (5,234) (5,641) 407
> the negative effect on unallocated deferred tax assets on the 2021 losses of Lavazza Professional Holding North
Interest paid to other lenders (105) (83) (22)
America amounting to approximately €6 million.
Other financial expense (8,857) (11,008) 2,151 NOTES TO THE FINANCIAL STATEMENTS
Total financial expense (14,196) (16,732) 2,536
These chiefly refer to income accrued on bonds and other securities held by the subsidiary Lavazza Capital S.r.l. INDEPENDENT AUDITORS’ REPORT

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As a result of the tax effect included in OCI: The theoretical tax rate considered is that in effect at the reporting date of these financial statements, in accordance
with the law, taking account of the IRES rate of 24% applied by the Parent Company.
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME COMPONENTS 2021 2020 In the interest of a clearer view of reconciliation, IRAP has not been considered, since this tax is calculated on a basis
other than pre-tax profit or loss, and hence would have had distorting effects. COMPANY OFFICERS
Deferred taxes relating to items recognised in OCI for the year
Gain/(loss) on the write-up of cash flow hedges (17,861) 5,038
GROUP STRUCTURE
Unrealised gains/(losses) on financial assets - 746 Deferred taxes LETTER TO SHAREHOLDERS
Net gain/(loss) on actuarial gains/(losses) (1,538) 527
Income taxes in the consolidated statement of other comprehensive income (19,399) 6,311 The following table provides the breakdown by nature of deferred tax assets and liabilities recognised in the DIRECTORS’ SINGLE REPORT
Statement of Profit or Loss and Statement of Financial Position: ON OPERATIONS
TYPE 31.12.2020 RETURNS PROVISIONS EXCHANGE RECLASSIFICATION MOVEMENTS 31.12.2021
The reconciliation between income taxes recognised and theoretical taxes resulting from the application of the RATE EFFECT TO OCI
effective tax rate on pre-tax income was as follows: RESERVE LAVAZZA GROUP
GROUP PRE-TAX RESULT 163,991 PRE-TAX
Deferred
at 31 December 2021
Theoretical tax rate 24% 67,625 (11,885) 16,929 331 (1,475) - 71,523
deductibility costs
GROUP THEORETICAL TAX RATE (39,358) Elimination of
Dividends (180) fiscal effect of 5,621 (1,731) 1,397 - - - 5,287
intercompany profit
Different tax ratio of Group companies (4,003)
Permanent differences (16,229)
FV adjustment of
5,587 - - - - (8,363) (2,777) ACCOUNTING STATEMENTS
financial derivatives
ACE / Patent Box tax incentives 4,253 Total upfront taxes 78,832 (13,617) 18,326 331 (1,475) (8,363) 74,033
Temporary differences for IFRS adjustments and other consolidation adjustments 3,310 > Consolidated Statement of Profit or Loss
PASSIVE
Temporary differences 2,973 DEFERRED TAXES
Prior years' tax losses 1,262 Deferred tax
Non-deductible taxes and costs (139)
liabilities on 38,094 (14,981) 21,537 - (1,475) - 43,175 > Consolidated Statement of Cash Flows
depreciation delta
Prior years' taxes (434) Other passive > Consolidated Statement of Changes in Equity
18,615 (2,943) 7,166 861 - - 23,699
IRAP (regional production tax) (7,444) differences
Other local taxes (2,474) FV adjustment of
3,521 - - - - 11,036 14,557
financial derivatives
ACTUAL TAX RATE (58,463)
Total deferred taxes 60,229 (17,923) 28,704 861 (1,475) 11,036 81,431 NOTES TO THE CONSOLIDATED

at 31 December 2021
> Balance Sheet


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12. Commitments and risks 13. Assets held for sale

COMPANY OFFICERS
GROUP STRUCTURE
Commitments and risks are given in the following table: Assets held for sale recognised in the consolidated statement of financial position at year-end include the industrial ON OPERATIONS
property located in Baranzate and a property for office use in Turin, whose value amounted to €5,247 thousand and
DESCRIPTION AMOUNT RECEIVED €1,000 thousand, respectively.
Commitments to purchase fixed assets 5,923 These properties will be sold and were both adjusted to fair value. LAVAZZA GROUP
The Group does not have other assets held for sale.
Commitments to purchase green coffee 21,455
Other real guarantees granted to third parties 403
Guarantees of credit lines granted to third parties 652 at 31 December 2021
Total 28,433
This item includes primarily: > Consolidated Statement of Financial Position

COMMITMENTS TO PURCHASE FIXED ASSETS GUARANTEES TO THIRD PARTIES IN FAVOUR OF > Consolidated Statement of Comprehensive Income
This item refers to commitments made during the year THE PARENT COMPANY
by Carte Noire Operations S.a.s. for the future purchase This item consists of guarantees given in our favour
of industrial plant and machinery. by banks: €1,500,000 in the interest of the Ministry > Consolidated Statement of Changes in Equity
of Economic Development for prize competitions;
COMMITMENTS TO PURCHASE GREEN COFFEE €4,964,254 for the application for VAT reimbursement
They refer to the commitments to purchase green cof- to a Group company; JPY 100,000,000 in the interest of NOTES TO THE CONSOLIDATED
fee undertaken by the subsidiary Kicking Horse Coffee. Tokyo Customs for import duties and taxes; and €81,000
in the interest of the A.E.M. Energia (Milan) and Edison
PERSONAL GUARANTEES ON LINES OF CREDIT Energia S.p.A. (Pozzilli) for gas supplies; €204,093 to INDEPENDENT AUDITORS’ REPORT
The subsidiary Lavazza France S.a.s. provides guaran- the Region of Piedmont for clearance work and safe-
tees for loans contracted by its clients in connection ty assessment associated with the new Headquarters;
with their operating activity. €231,930 to the Turin municipality for the creation of
equipped flowerbeds at the new headquarters and the
OTHER GUARANTEES TO THIRD PARTIES groundwater remediation works Isernia for drinking LUIGI LAVAZZA S.p.A.
They chiefly refer to the guarantees on coffee machines water supply; €16,702 to Consorzio Nucleo Sviluppo
lend to the subsidiary Lavazza Professional Germany Industriale Isernia for drinking water supply; €577,020 Financial Statements
G.m.b.H. to Customs; €690,338 for property leases; €74,000 for
Italy’s General Commissioner for the participation of
at 31 December 2021
Italy to EXPO 2020 DUBAI and referring to the sponsor- ACCOUNTING STATEMENTS
ship of the Italian pavilion.
> Balance Sheet


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14. Risk management objectives and

criteria COMPANY OFFICERS
GROUP STRUCTURE
As explained in Note 10.21, the Group’s main financial liabilities, besides derivative liabilities, include bank loans Interest rate risk Foreign exchange risk ON OPERATIONS
and financing, trade and other payables. The main objective of such liabilities is to finance the Group’s operating
activities. Interest rate risk is the risk that interest rate fluctua- The Group is exposed to fluctuations in exchange rates,
tions impact financial assets, payables to banks and particularly with regard to the purchase of green cof- LAVAZZA GROUP
The Group has financial and other receivables, both trade and non-trade receivables, cash and cash equivalents and lease contracts. fee (the main raw material used), denominated in USD,
short-term deposits originating directly from its operating activities. The Group also holds AFS investments, other In the Group's case in particular, interest-rate risk pri- and to sales in countries with currencies other than the Consolidated Financial Statements
financial securities and derivative assets.
The Group is exposed to market risk, interest risk, exchange rate risk, raw material price risk, and credit risk.
marily derives from floating-rate medium-/long-term
loans.
Euro.
In order to reduce the impact of changes in exchange
at 31 December 2021
The Group’s management oversees the management of these risks. All derivative activities for risk management The Group has contracted financial derivatives (inter- rates on expected cash flows, the Group contracts de-
purposes are carried out by specialist teams that have the appropriate skill and experience. It is the Group’s policy est rate swaps) with the aim of mitigating this risk by rivatives for hedging purposes, in accordance with its
that no trading in derivatives for speculative purposes may be undertaken. transforming them from floating-rate to fixed-rate. risk management policy. ACCOUNTING STATEMENTS
In addition, the option to transform the lease from > Consolidated Statement of Financial Position
The Board of Directors reviews and approves policies for managing each of these risks, which are summarised below. floating rate to fixed rate was exercised.
Risk of coffee price Credit risk

fluctuations The Group has established a credit management (trade NOTES TO THE CONSOLIDATED
finance) function, exclusively tasked with monitoring
The price of green coffee is subject to considerable credit status, payment reminders, customised and spe-
volatility caused by both variables relating to physical cific management of each client, through internal risk INDEPENDENT AUDITORS’ REPORT
supply and demand mechanisms (harvest, stocks, con- control procedures.
sumption and logistical limitations) and speculative The Group applies a specific policy aimed at standard-
activity on the exchanges. ising the processes of assigning credit limits to and
In order to limit the impact of fluctuations in coffee clustering clients in the interest of uniform manage-
prices, the Group adopts procurement policies that ment of credit issues across the various countries. LUIGI LAVAZZA S.p.A.
aim to reduce price changes, while also undertaking This process is supported by a sale order monitoring
hedging transactions through financial derivatives, as scheme based on defined credit limits, implemented in Financial Statements
established by its risk management policy.
No speculative transactions are undertaken.
the Group’s IT systems.
Disputed accounts are regularly monitored with legal
at 31 December 2021
counsel to ensure constant updates to the stages of the ACCOUNTING STATEMENTS
various cases, as reflected in an accrual to the provi-
sion for the write-down of receivables. > Balance Sheet
Trade receivables from third parties deemed to have > Statement of Profit or Loss
become impaired are classified as bad debts, primarily
past due by more than one year and managed through
legal procedures.
The maximum amount of the risk at the reporting rate
is equal to the net carrying amount of the trade receiv- NOTES TO THE FINANCIAL STATEMENTS
ables, also taking account of the risk of the expected
credit loss estimated by the Company on the basis of
the business model identified (as defined by IFRS 9). INDEPENDENT AUDITORS’ REPORT

136 137 PRINT PDF
15. Related party disclosures

COMPANY OFFICERS
GROUP STRUCTURE
The following table provides the total amount of transactions that have been entered into with related parties in Sales to and purchases from related parties are carried out at arms’ length conditions. For the year ended 31 ON OPERATIONS
2021 and in the previous year: December 2021, the Group had no impairments on contracts with related parties. The impairment test is carried
out yearly, at each reporting date, considering the financial position of the related party and the market where it
2021 operates. LAVAZZA GROUP
COMPANY TYPE SALES OF PURCHASES FINANCIAL FINANCIAL TRADE TRADE FINANCIAL FINANCIAL Regarding transactions with related parties, these cannot be categorised either as atypical or unusual and fall within
GOODS GOODS INCOME EXPENSE RECEIVABLES PAYABLES RECEIVABLES PAYABLES the normal course of Group company operations. These transactions are settled at arm’s length and have been con- Consolidated Financial Statements
at 31 December 2021
AND AND ducted under conditions equivalent to those prevailing in free transactions between independent parties.
SERVICES SERVICES
Related parties have not changed substantially from the previous year, with the exception of several services ren-
Lavazza Trading
Subsidiary - 1,274 - - - 770 - - dered by Yibai Co. LTD, belonging to the Y&L Coffee Limited Group, in which Luigi Lavazza S.p.A. holds a 35% stake.
(Shenzhen) Co.Ltd
Lavazza Maroc
S.a.r.l.
Subsidiary - 158 - - 4 96 - -
Remuneration paid to Directors and Statutory Auditors is detailed in the following table (in Euro): ACCOUNTING STATEMENTS
Manufacture de Café Associate 23 - - - 23 - 176 - > Consolidated Statement of Financial Position
Yibai Co. LTD Associate 284 - - - 284 - - - TOTAL REMUNERATION PAID > Consolidated Statement of Profit or Loss
Other related
Torino Inv.1895 S.p.A - - 692 - - - 70,175 - > Consolidated Statement of Comprehensive Income
party Fixed remuneration to Directors 1,830,054
Lavazza Other related Fixed remuneration to Statutory Auditors 167,440 > Consolidated Statement of Cash Flows
- - - 1 - - - 476
Entertainment S.r.l. party
Other related
Total 1,997,494 > Consolidated Statement of Changes in Equity
Lavazza Eventi S.r.l. 427 1,324 - - 157 106 - 348
party
Other related
Lea S.r.l. 170 854 - - 46 750 391 2
party NOTES TO THE CONSOLIDATED
Other related
Tosetti Value S.p.A. - 708 - - - - - - FINANCIAL STATEMENTS
Information on the consideration owed to the independent
party
Chili S.p.A.
Other related
- 1,040 - - - 5 - - INDEPENDENT AUDITORS’ REPORT
party
Total 905 5,357 692 1 515 1,727 70,741 826 auditors of the annual accounts pursuant to the new
2020 paragraph 1 of Article 38 of Legislative Decree No. 127/91
COMPANY TYPE SALES OF PURCHASES FINANCIAL FINANCIAL TRADE TRADE FINANCIAL FINANCIAL LUIGI LAVAZZA S.p.A.
GOODS GOODS INCOME EXPENSE RECEIVABLES PAYABLES RECEIVABLES PAYABLES
AND
SERVICES
AND
SERVICES
The following table presents the total amount of the consideration owed to EY S.p.A. for conducting statutory inde- Financial Statements
Lavazza Trading
Subsidiary - 1,011 - - - 545 - -
pendent audits of the annual accounts of the Financial Statements of the Parent Company, Luigi Lavazza S.p.A., its
Italian subsidiaries Cofincaf S.p.A., Lavazza Capital S.r.l., Nims S.p.A. and Lavazza Professional Holding Europe S.r.l,
at 31 December 2021
(Shenzhen) Co.Ltd
Lavazza Maroc and, separately, a statutory independent audit of the Consolidated Financial Statements of the Lavazza Group for the ACCOUNTING STATEMENTS
Subsidiary 4 136 - - 4 81 - -
S.a.r.l. year ended 31 December 2021, as well as the total amount of consideration accrued for other minor services relating
Torino Inv.1895 Other related to methodological support activities. > Balance Sheet
- - 708 - - - 70,000 -
S.p.A party > Statement of Profit or Loss
Lavazza ACTIVITY COMPANY 2021
Other related
Entertainment - - - 1 - - - 493 > Statement of Cash Flows
party
S.r.l. Luigi Lavazza S.p.A. 77,000
Other related
Lavazza Eventi S.r.l. 293 703 - 1 (1) 49 - 305 Consolidated Lavazza Group 82,000
party
Other related Cofincaf S.p.A. 24,000 NOTES TO THE FINANCIAL STATEMENTS
Lea S.r.l. 383 274 - - - 4 16 2 Audit of annual accounts
party
Other related
Lavazza Capital S.r.l. 18,000 STATUTORY AUDITORS’ REPORT
Tosetti Value S.p.A. - 580 - - - 290 - -
party Nims S.p.A. 25,000
Other related
Chili S.p.A. - 1,487 - - - 75 - - Lavazza Professional Holding Europe S.r.l. 5,000
party
Total 680 4,192 708 2 3 1,045 70,016 799 Total 231,000
138 139 PRINT PDF
16. Post balance sheet events

COMPANY OFFICERS
GROUP STRUCTURE
The Group has distributors and customers in emerging markets that may also be subject to geopolitical risks such ON OPERATIONS
as, for example, Russia and Ukraine. At the reporting date, the devastating effects in both countries produced by the
Russian invasion of Ukraine are evident. Most production and commercial activities have been suspended. At the
same time, Russia has been hit by heavy sanctions issued by the main European and Nato countries as well as the LAVAZZA GROUP
flight of foreign private investors which are weakening its economy. There are no significant impacts on the Group’s
business even though all activities in Russia were suspended at the reporting date, combined with the inability to Consolidated Financial Statements
supply the Ukrainian market.
The 2021 results are not only a historic milestone for the Group but also the starting point from which to face a year
at 31 December 2021
that promises to be extremely complex and challenging, due to the rise in all the raw materials we deal with: green
coffee primarily but also packaging, energy and logistics. The strong price volatility marking this period makes it
particularly difficult to provide completely reliable forecasting elements. ACCOUNTING STATEMENTS
Finally, with regard to the Covid-19 pandemic situation, a large part of the population has completed the primary > Consolidated Statement of Financial Position
vaccination cycle and so it is hoped that the arrival of the summer season will see a generalised recovery in
consumption, with particular regard to the Away from Home sector. > Consolidated Statement of Profit or Loss


at 31 December 2021
> Balance Sheet


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COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet
Independent NOTES TO THE FINANCIAL STATEMENTS
Auditors’ Report

142 143 PRINT PDF
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet


PRINT PDF
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet


PRINT PDF
LAVAZZA GROUP - ANNUAL REPORT 2021 NOTES TO THE FINANCIAL STATEMENTS OF LUIGI LAVAZZA S.p.A.
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021

> Balance Sheet
FINANCIAL > Statement of Cash Flows
STATEMENTS
at 31 December 2021

148 149 PRINT PDF
LAVAZZA GROUP - ANNUAL REPORT 2021 LUIGI LAVAZZA S.P.A. - FINANCIAL STATEMENTS AT 31 DECEMBER 2021
Accounting Statements
COMPANY OFFICERS
GROUP STRUCTURE
C) CURRENT ASSETS DIRECTORS’ SINGLE REPORT

Balance Sheet - Assets I) INVENTORIES
ON OPERATIONS
1) raw material, ancillaries and consumables 215,320,331 191,582,276
LAVAZZA GROUP
2) work in progress and semi-finished goods 2,089,822 1,019,729
€ units 31.12.2021 31.12.2020 4) finished products and goods 94,579,710 97,225,342
A) CALLED-UP SHARE CAPITAL NOT PAID 5) advances payments 816,319 876,015
OUTSTANDING PAYMENTS - - Consolidated Financial Statements
B) ASSETS
TOTAL INVENTORIES 312,806,182 290,703,362
at 31 December 2021
I) INTANGIBLE ASSETS
II) RECEIVABLES
1) start-up and expansion costs - -
1) trade receivables 115,072,525 102,050,470
2) development costs 5,673,945 4,301,648
2) from subsidiaries 280,128,302 253,896,380 ACCOUNTING STATEMENTS
industrial patent rights and rights for exploitation of intellectual
3) 1,659,484 331,118 3) from associates 284,477 - > Consolidated Statement of Financial Position
property
4) from parent companies 27,500 -
4) concessions licenses, trademarks and similar rights 212,040,084 227,366,814
5) from related companies 594,081 16,509 > Consolidated Statement of Profit or Loss
5) goodwill 253,495,695 270,612,542
5-bis) tax receivables 16,042,935 8,975,163
6) intangible assets in process and advances 7,490,099 8,859,339 > Consolidated Statement of Comprehensive Income
5-ter) prepaid taxes 43,881,452 41,453,828
7) other 42,887,643 34,390,211
5-quater) other receivables 7,145,402 8,983,764 > Consolidated Statement of Cash Flows
TOTAL INTANGIBLE ASSETS 523,246,950 545,861,672 > Consolidated Statement of Changes in Equity
TOTAL RECEIVABLES 463,176,674 415,376,114
II) PROPERTY, PLANT AND EQUIPMENT

III) FINANCIAL ASSETS OTHER THAN FIXED ASSETS
1) land and buildings 81,001,120 83,790,568
2) plant and machinery 205,122,026 209,946,525
3) industrial and commercial equipment 45,880,348 57,127,887 5) derivative financial assets 16,079,492 15,297,219 FINANCIAL STATEMENTS
4) other assets 10,093,505 11,730,104 6) other securities - -
5) tangible assets in process and advances 23,097,456 12,755,981
TOTAL FINANCIAL ASSETS OTHER THAN FIXED ASSETS 16,079,492 15,297,219
TOTAL TANGIBLE ASSETS 365,194,455 375,351,065
IV) CASH AND CASH EQUIVALENTS

III) FINANCIAL ASSETS
1) bank and post office deposits 483,156,145 179,161,026 LUIGI LAVAZZA S.p.A.
1) investments in: 3) cash and valuables on hand 175,156 144,347
a) subsidiaries
b) associates
1,329,904,796
36,534,327
1,259,400,369
6,262,747 TOTAL CASH AND CASH EQUIVALENTS 483,331,301 179,305,373
d-bis) other companies 7,293,917 7,293,758 at 31 December 2021
2) receivables:
V) TANGIBLE ASSET HELD FOR SALE 6,236,337 8,386,337
a) to subsidiaries 120,553,359 161,541,089 ACCOUNTING STATEMENTS
of which due after one year 120,553,359 161,541,089
d-bis) to others 757,169 788,668 TOTAL WORKING CAPITAL (C) 1,281,629,986 909,068,405 > Balance Sheet
of which due after one year 757,169 788,668 > Statement of Profit or Loss
4) derivative financial assets 2,162,940 4,878,885 D) PREPAYMENTS AND ACCRUED INCOME 29,917,731 28,718,976
TOTAL NON-CURRENT FINANCIAL ASSETS 1,497,206,508 1,440,165,516
TOTAL ASSETS 3,697,195,630 3,299,165,634
TOTAL FIXED ASSETS (B) 2,385,647,913 2,361,378,253


150 151 PRINT PDF
Balance Sheet – Equity and Liabilities

COMPANY OFFICERS
€ units 31.12.2021 31.12.2020
GROUP STRUCTURE
A) EQUITY
I. SHARE CAPITAL 25,000,000 25,000,000
II. SHARE PREMIUM ACCOUNT 223,523 223,523
III. REVALUATION RESERVES 426,580,270 426,580,270 ON OPERATIONS
IV. LEGAL RESERVE 5,000,000 5,000,000
V. STATUTORY RESERVES - -
VI. OTHER RESERVES
Extraordinary reserve 211,519,258 203,611,325
LAVAZZA GROUP
Reserve Re. Art.18 Presidential Decree 675/77 16,892 16,892
Reserve Re. Art. 55 law 526 of 7/8/82 86,235 86,235
Reserve Re. Law 46 of 17/02/82
Reserve Re. Art. 55 dpr 917/86
90,785
212,481
90,785
212,481
at 31 December 2021
Reserve Re. Law 130 of 26/04/83 162,463 162,463
Reserve Re. Law 488 of 19/12/92 380,808 380,808
Restricted reserve arising on exchange gains - 7,907,933 ACCOUNTING STATEMENTS
Merger surplus 56,953,074 56,953,074
VII. HEDGE RESERVE FOR EXPECTED CASH FLOWS 40,715,275 (6,451,155) > Consolidated Statement of Financial Position
VIII. PROFIT CARRIED FORWARD 1,545,635,099 1,487,239,948
IX. PROFIT FOR THE YEAR 103,604,137 91,470,155
X. NEGATIVE RESERVE FOR TREASURY SHARES IN PORTFOLIO (17,732,533) (17,732,533) > Consolidated Statement of Comprehensive Income

TOTAL EQUITY 2,398,447,767 2,280,752,204
B) PROVISIONS
1) for pension and similar obligations 2,797,917 2,794,874
2) for taxes, including deferred 19,149,576 5,402,306
3) derivative financial liabilities 4,040,181 19,964,026 NOTES TO THE CONSOLIDATED
4) other 124,585,112 92,491,591 FINANCIAL STATEMENTS
TOTAL PROVISIONS 150,572,786 120,652,797
C) EMPLOYEE LEAVING INDEMNITIES 12,138,174 12,578,630
D) LIABILITIES
4) payables to banks 628,988,723 464,439,416 LUIGI LAVAZZA S.p.A.

a) of which due after one year 453,816,903 309,308,816
6) advances payments 1,482,963 992,830 Financial Statements
7)
9)
trade payables
payables to subsidiaries
277,214,077
119,528,874
203,294,883
125,905,797
at 31 December 2021
11) payables to the Parent 10,315,835 10,199,264
11 bis) payables to related companies 1,684,896 978,330 ACCOUNTING STATEMENTS
12) deferred tax liabilities 6,094,769 8,863,397 > Balance Sheet
13) social security liabilities 5,412,091 5,878,681
14) other liabilities 76,127,600 58,297,454 > Statement of Profit or Loss

TOTAL LIABILITIES 1,126,849,828 878,850,052
E) ACCRUALS AND DEFERRED INCOME 9,187,075 6,331,951

TOTAL EQUITY AND LIABILITIES 3,697,195,630 3,299,165,634

152 153 PRINT PDF
Statement of Profit or Loss

COMPANY OFFICERS
€ units YEAR 2021 YEAR 2020
GROUP STRUCTURE
A) VALUE OF PRODUCTION
1) net revenues 1,660,705,990 1,520,996,333
C) FINANCIAL INCOME AND EXPENSE LETTER TO SHAREHOLDERS
15) income from investments 25,516,195 33,053,684
2)
change in inventories of work in progress, semi-finished and
520,134 6,436,404 - from subsidiaries and associates 25,516,195
finished goods
5) other income and revenues: 129,908,132 103,916,575 16) other financial income - 33,053,684 ON OPERATIONS
a) miscellaneous 128,456,182 102,477,862 a) from non-current receivables 2,796,639 3,806,850
LAVAZZA GROUP
b) grants 1,451,950 1,438,713 - from subsidiaries and associates 2,796,639 3,806,850
d) income other than the preceding ones 34,498 586,564
TOTAL VALUE OF PRODUCTION 1,791,134,256 1,631,349,312 - from subsidiaries and associates
- from companies controlled by the Parent
7,899
268
26,971
638
B) COSTS OF PRODUCTION - from other companies 26,331 558,955 at 31 December 2021
6) for raw materials, ancillaries, consumables and goods 780,547,288 748,586,719 17) interest and other financial expense (5,725,282) (6,187,859)
7) for services 580,206,360 498,155,818 - paid to subsidiaries and associates (620,162) (678,811)
8) for use of third-party assets 24,167,103 22,549,496 - paid to companies controlled by the parent company (235) (2,091) ACCOUNTING STATEMENTS
9) for personnel: 174,346,379 162,970,517 - paid to other companies (5,104,885) (5,506,957)
a) wages and salaries 123,480,433 114,390,141 17-bis) exchange gains and losses 6,196,187 (6,564,852)
b) social security costs 33,992,308 32,082,590
c) severance indemnities 7,561,739 8,211,482 TOTAL FINANCIAL INCOME AND EXPENSES 28,818,237 24,694,387 > Consolidated Statement of Comprehensive Income
e) other costs 9,311,899 8,286,304 > Consolidated Statement of Cash Flows
10) amortisation, depreciation and write-downs 102,095,470 89,649,983 D) VALUE ADJUSTMENTS TO FINANCIAL ASSETS
a) amortisation 46,555,584 43,646,706 18) write-ups 1,494,654 2,855,470
b) depreciation 51,428,987 40,540,226 a) of equity investments - -
c) other write-downs of fixed assets 2,800,507 2,623,967 d) of derivatives 1,494,654 2,855,470
19) write-downs: (5,766,246) (3,600,222)
d) write-downs of current receivables
and of cash and cash equivalents 1,310,392 2,839,084 a) of equity investments (2,731,408) (2,947,233) FINANCIAL STATEMENTS
11)
changes in inventories of raw material, ancillaries, consumables
(23,738,055) (18,004,584)
b) of financial fixed assets other than investments - - INDEPENDENT AUDITORS’ REPORT
and goods c) of current securities other than investments - -
12) provisions for risks 23,027,083 11,648,648 d) of derivatives (3,034,838) (652,989)
13) other provisions 221,642 1,239,340
14) miscellaneous operating costs 19,130,561 27,499,248
TOTAL VALUE ADJUSTMENTS OF FINANCIAL ASSETS (4,271,592) (744,752)
TOTAL COSTS OF PRODUCTION 1,680,003,831 1,544,295,185 PROFIT BEFORE TAXES (A-B+-C+-D) 135,677,070 111,003,762
20) current, deferred and prepaid income taxes for the year (32,072,933) (19,533,607)
DIFFERENCE BETWEEN VALUE AND COSTS current taxes (38,886,350) (30,099,061) at 31 December 2021
OF PRODUCTION (A - B) 111,130,425 87,054,127 net deferred tax liabilities 59,875 1,452,775
net deferred tax assets 7,133,505 7,015,637
taxes relating to previous years (379,963) 2,097,042 > Balance Sheet

21) PROFIT FOR THE YEAR 103,604,137 91,470,155


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Statement of Cash Flows

COMPANY OFFICERS
€ units YEAR 2021 YEAR 2020
GROUP STRUCTURE
B Cash flows from investing activities
A Cash flows from operating activities
Profit (loss) for the year 103,604,137 91,470,155
Property, plant and equipment LETTER TO SHAREHOLDERS
(Investments) (46,513,482) (41,526,020)
Income taxes 32,072,933 19,533,607 DIRECTORS’ SINGLE REPORT
Disposal price 3,041,768 4,360,552
Interest expense / (interest income) (3,302,042) 8,359,297
Intangible assets
ON OPERATIONS
Derivatives 1,540,184 -
(Investments) (21,053,116) (19,124,925)
(Dividends) (25,516,195) (33,053,684)
LAVAZZA GROUP
Profit (loss) for the year before income taxes, interest, dividends and gains / Disposal price - -
1 108,399,017 86,309,375
losses from disposal Financial assets
Adjustments for non-monetary items that have no offsetting entry in net working
capital
(Investments) (58,909,096) (53,054,198)
Disposal price 1,833,232 11,000,485
Provisions 56,611,787 50,064,292
Current financial assets at 31 December 2021
Provision of employee severance indemnities 435,561 160,678
(Investments) (782,273) 8,914,339
Amortisation and depreciation 97,984,571 84,186,932
Disposal price - -
Write-down / write-up of equity investments and derivatives 2,731,408 2,973,356
Total cash flows from investing activities (B) (122,382,967) (89,429,767) ACCOUNTING STATEMENTS
Other impairment losses 2,800,507 2,623,967
C Cash flows from financing activities > Consolidated Statement of Financial Position
Value adjustments to derivative financial assets and liabilities that do not entail Third-party funds
40,538,183 (12,537,881)
monetary movements > Consolidated Statement of Profit or Loss
Increase (decrease) in short-term payables + other than to banks 164,549,307 (124,600,185)
Other adjustments for non-monetary items - (2,005,944)
Increase (decrease) in financial payables to subsidiaries (4,145,398) 4,529,777 > Consolidated Statement of Comprehensive Income
Net effect of merger (1,097,388) 185,935
2 Cash flow before changes in net working capital 308,403,646 211,960,710
Own funds > Consolidated Statement of Cash Flows
(Dividends (and advances on dividends) paid) (33,075,003) (50,175,004)
Changes in net working capital > Consolidated Statement of Changes in Equity
Total cash flows from financing activities (C) 127,328,906 (170,245,412)
Decrease / (increase) in inventories (19,952,820) (30,122,773)
Increase (decrease) in cash and cash equivalents (A +- B +- C) 304,025,928 (68,048,885)
Decrease / (increase) in trade receivables (13,022,055) 17,087,266
Decrease / Increase of receivables from Group companies (28,260,400) 13,466,297 NOTES TO THE CONSOLIDATED
Cash and cash equivalents at year-start 179,305,373 247,354,258
Increase / (decrease) in trade payables 74,409,327 (44,957,573)
Cash and cash equivalents at year-end 483,331,301 179,305,373
Decrease / Increase of payables to Group companies (269,459) 15,379,304
Decrease / (increase) in prepayments and accrued income (1,198,755) 4,941,112
Increase / (decrease) in accruals and deferred income 2,855,124 1,023,127
The Company has prepared the Statement of Cash Flows, which reconciles the main changes in the company’s
Other changes in net working capital 15,259,356 12,860,132 equity and changes in financial position during the year. It highlights the values of the financial resources that the
3 Cash flow after changes in net working capital 338,223,964 201,637,603 Company required in the year, as well as their use.
Other adjustments It should be noted that in preparing the Statement of Cash Flows, pursuant to OIC 10, the Company has adopted the LUIGI LAVAZZA S.p.A.
Interest received / (paid) (739,539) (8,359,297) indirect method whereby profit for the year is adjusted for non-monetary components.
(Income taxes paid) (36,352,816) (4,129,230) Financial Statements
Dividends collected 25,516,195 29,053,684 at 31 December 2021
(Use of funds) (26,691,798) (25,278,768)
(Severance indemnities paid) (876,017) (1,297,697) ACCOUNTING STATEMENTS
Total cash flows from operating activities (A) 299,079,989 191,626,294 > Balance Sheet


156 157 PRINT PDF
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
Notes to the ACCOUNTING STATEMENTS
Financial Statements of
> Balance Sheet
Luigi Lavazza S.p.A. NOTES TO THE FINANCIAL STATEMENTS


158 159 PRINT PDF
Structure and contents

COMPANY OFFICERS
GROUP STRUCTURE
These Financial Statements, composed of the Balance
Sheet, Statement of Profit or Loss, Statement of Cash LETTER TO SHAREHOLDERS
Flows and the Notes to the Financial Statements, have
been prepared in accordance with Legislative Decree DIRECTORS’ SINGLE REPORT
No. 127 of 9 April 1991, as amended by Legislative ON OPERATIONS
Decree No. 6 of 17 January 2003 and Legislative Decree
No. 139 of 18 August 2015. They provide a fair and true
representation of the Company’s financial position, op- LAVAZZA GROUP
erating performance and cash flows for the year.
The Directors' Single Report on Operations in the previous Consolidated Financial Statements
pages accompanies these Financial Statements.
The financial statements have been prepared in compli-
at 31 December 2021
ance with Articles 2423-ter, 2424, 2424-bis, 2425, 2425-bis,
2425-ter of the Italian Civil Code. Figures are stated in units of Euro.
The Notes to the financial statements provide the in- ACCOUNTING STATEMENTS
formation required by Articles 2427 and 2427-bis of the > Consolidated Statement of Financial Position
Italian Civil Code. Amounts are denominated in units of
Euro, unless stated otherwise in the comments of the > Consolidated Statement of Profit or Loss
related financial statement items. > Consolidated Statement of Comprehensive Income
Items omitted from the financial statements are under-
stood to have nil balances in both the reporting year
and the previous year. > Consolidated Statement of Changes in Equity

Basis of preparation and measurement FINANCIAL STATEMENTS
The Financial Statements for the year ended 31 December 2021 have been prepared in compliance with the Italian
Civil Code, interpreted and supplemented by the accounting standards drawn up and revised by the Italian Accounting
Standard Setter (OIC) as amended and extended by Legislative Decree No. 139/2015 of 1 January 2016 and, in the
absence of the former, and where no conflict exists, the standards issued by the International Accounting Standards LUIGI LAVAZZA S.p.A.
Board (IASB).
In accordance with Articles 2423 and 2423-bis of the Italian Civil Code, the Financial Statements have been prepared Financial Statements
on the basis of the going concern assumption, according to the general principles of prudence, accrual basis ac-
counting and materiality, while taking account of the prevalence of the substance of a transaction or contract.
at 31 December 2021
The criteria applied in measuring line items and determining adjustments are consistent with the provisions of the ACCOUNTING STATEMENTS
Italian Civil Code and are primarily set out under Article 2426.
> Balance Sheet
The most significant measurement criteria adopted are illustrated below. > Statement of Profit or Loss


160 161 PRINT PDF
Intangible assets Tangible assets

Intangible assets are recognised at purchase or production cost, including ancillary charges and directly attributable Tangible assets are recognised at purchase or internal production cost, revalued
costs, adjusted in prior years for revaluations pursuant to Laws Nos. 408/1990, 342/2000, 350/2003 and 266/2005. where required, in compliance with the monetary revaluation laws, as indicated in COMPANY OFFICERS
The cost of intangible assets is systematically amortised on a straight-line basis each year, considering the residual the relevant table.
GROUP STRUCTURE
useful life of the asset. The rates applied are set out in the section of the Notes on Assets. Purchase costs for goods acquired from third parties include ancillary charges and
direct and indirect costs, to the extent reasonably attributable to the asset, from the LETTER TO SHAREHOLDERS
period of production and for its remaining useful life.
START-UP AND EXPANSION COSTS GOODWILL Assets acquired through contribution or merger are recognised at the contribution DIRECTORS’ SINGLE REPORT
value established in the pertinent documents on the basis of the related appraisal. ON OPERATIONS
Start-up and expansion costs, where present, have Goodwill is recognised among assets, with the consent The cost of internally produced assets includes all costs directly attributable to the
been recognised among assets with the consent of the of the Board of Statutory Auditors, if it is purchased for asset, in addition to the share of general production costs reasonably attributable to
Board of Statutory Auditors and are amortised over a consideration, and is amortised according to its useful the asset with regard to the production period, until the asset is ready for use. LAVAZZA GROUP
period of no more than five years. life. Ordinary maintenance costs are recognised to the statement of profit or loss for the
The Company has exercised the option for prospec- financial year in which they are incurred. Consolidated Financial Statements
DEVELOPMENT COSTS
tive application, pursuant to Article 12, paragraph 2,
of Legislative Decree No. 139/2015, of the changes to
The costs of improvements and incremental expenses, including extraordinary main-
tenance costs, in addition to the costs of leasehold improvements capable of being
at 31 December 2021
the method for determining the amortisation period for separated from the assets in question, which give rise to a significant, measurable
Development costs involve a plan or project for the goodwill. increase in the capacity, productivity or security of the assets, or which extend their
production of new products or processes and are am- Consequently, goodwill recognised prior to the finan- useful lives, qualify as capitalisable costs and are accounted for as an increase in the ACCOUNTING STATEMENTS
ortised based on their useful lives; in exceptional cases cial year beginning on 1 January 2016 has been amor- value of the assets to which they refer, within the limits of the recoverable amount of > Consolidated Statement of Financial Position
in which it is not possible to estimate their useful lives, tised over a period of no more than five years or, where the asset.
they are amortised over a period of no more than five the useful life was greater, over a period of no more > Consolidated Statement of Profit or Loss
years. than 20 years. Tangible assets are systematically depreciated each year on a straight-line basis. > Consolidated Statement of Comprehensive Income
Development costs are recognised among assets with Goodwill recognised on or after 1 January 2016 has Depreciation is based on economic and technical rates taking account of the remain-
the consent of the Board of Statutory Auditors only if: been amortised according to its useful life, with a max- ing useful lives of the assets. The rates applied are indicated in the Notes on Assets.
(i) the cost attributable to the asset during its devel- imum limit of 20 years, and over a period of no more If an element of tangible assets is made up of different components with different > Consolidated Statement of Changes in Equity
opment can be reliably measured; (ii) the product or than ten years when its useful life cannot be estimated useful lives, such components are recognised separately only if they are significant
the process is feasible from a technical and commer- reliably. components.
cial standpoint; and (iii) it is probable that there will Land is not subject to the depreciation process. NOTES TO THE CONSOLIDATED
be future economic benefits and there are sufficient
resources to complete the development. FIXED ASSETS IN PROCESS AND ADVANCES
ASSETS HELD FOR SALE AND OBSOLETE ASSETS INDEPENDENT AUDITORS’ REPORT
RIGHTS FOR INDUSTRIAL PATENTS AND Fixed assets in process and advances include intangi-
RIGHTS FOR EXPLOITATION OF INTELLECTUAL ble assets in progress, initially recognised on the date When it is decided to dispose of a tangible asset, the latter is reclassified to current
PROPERTY on which the Company incurs the first (internal and assets and then measured at the lesser of its net carrying amount and the presumed
external) costs for the production of the asset and ad- realisable value based on market performance, i.e., the selling price in the course of
Patents have been recognised among assets at pur- vances to suppliers towards the purchase of intangible normal operation, net of direct selling and disposal costs. Moreover, assets intended LUIGI LAVAZZA S.p.A.
chase or internal production cost, including any addi- assets, initially recognised when the obligation to pay for sale are no longer subject to depreciation.
tional costs incurred for administrative and application the amounts concerned arises. Such costs continue to Obsolete assets and, more generally, assets that will no longer be used or useable in Financial Statements
procedures, and are amortised according to their use-
ful lives, which may not, in any event, exceed the legal
be carried as fixed assets until ownership of the right is
acquired or the project is completed. When these con-
the production cycle on a permanent basis, are measured at the lesser of net carrying
amount and recoverable amount, and are no longer subject to depreciation.
at 31 December 2021
or contractual limit. ditions occur, the amounts in question are classified to ACCOUNTING STATEMENTS
the appropriate item of intangible assets.
> Balance Sheet
CONCESSIONS, LICENCES, TRADEMARKS AND > Statement of Profit or Loss
SIMILAR RIGHTS
Concessions, licences, trademarks and similar rights,
where purchased for consideration, are recognised
among assets at the price paid by the Company to ob- NOTES TO THE FINANCIAL STATEMENTS
tain them and are amortised according to their useful
lives, which may not, in any event, exceed the legal or
contractual limit and can never exceed 20 years. INDEPENDENT AUDITORS’ REPORT

162 163 PRINT PDF
Grants towards tangible and intangible assets Finance leases

Grants are recognised when it is reasonably certain that the conditions for receipt of The accounting treatment of lease transactions is consistent with the customary statutory practice in Italy (so-called
the grant have been met and the grants will be disbursed. “equity method”) and involves the recognition of rent payments in the statement of profit or loss as they accrue. COMPANY OFFICERS
They are accounted for according to the indirect method, whereby a grant indirectly The adoption of the finance lease method would have entailed the recognition in the statement of profit or loss, in
GROUP STRUCTURE
reduces the cost of the fixed assets to which it refers, by booking them to item A5 lieu of lease payments, of interest on the residual principal of the financing and the depreciation charges on the
“Other income and revenues” of the statement of profit or loss, and then deferred to value of the leased property, commensurate to the remaining useful life of that property, as well as the recognition LETTER TO SHAREHOLDERS
subsequent years by recognising deferred income. Amortisation and depreciation of of the leased property as an asset and the remaining debt as a liability.
fixed assets are therefore calculated on the basis of the value of the assets, gross of Pursuant to Article 2427, paragraph 1(22), of the Italian Civil Code, these Notes include information about the effects DIRECTORS’ SINGLE REPORT
the grants received. of the adoption of the finance lease method: ON OPERATIONS
> the total amount at which the leased assets would have been carried at the reporting date, had they been con-
sidered fixed assets; LAVAZZA GROUP
Impairment losses on fixed assets > the depreciation, impairment and reversals that would have accrued during the year; Consolidated Financial Statements
At each reporting date, the Company assesses whether there are any indications that > the present value of future lease payments, determined using the effective interest rate of the finance lease
at 31 December 2021
tangible and intangible assets (including goodwill) may have become impaired. agreement;
If such signs exist, the carrying amount of the asset is reduced to its recoverable
amount, determined as the greater of fair value, net of costs to sell and value in use. > the finance expense accrued during the year, determined according to the effective interest rate. ACCOUNTING STATEMENTS
Fair value is represented, firstly, by a price arising from a binding sale agreement in a > Consolidated Statement of Financial Position
transaction between independent counterparties, net of the costs directly attributable
to the sale. In the absence of a binding agreement, it is verified whether there is a cur- > Consolidated Statement of Profit or Loss
rent offering price in an active market. If there is no binding sale agreement or market Investments and financial receivables > Consolidated Statement of Comprehensive Income
of reference, fair value is based on the best information available to the entity and
which reflects the net amount that could be realised from sale, at the reporting date,
in a free transaction between informed, willing parties. When the recoverable amount INVESTMENTS FINANCIAL RECEIVABLES > Consolidated Statement of Changes in Equity
of an individual asset cannot be estimated, the Company estimates the recoverable
amount of the cash-generating unit (“CGU”) to which the asset belongs. The value in These are equity interests in other companies and they Pursuant to Article 12, paragraph 2, of Legislative
use of an asset is calculated by determining the present value of the expected future are divided into investments in subsidiaries and associ- Decree No. 139/2015, the Company has opted for pro- NOTES TO THE CONSOLIDATED
cash flows over a 3-5 year time horizon, according to a discount rate that reflects the ates, as defined in Article 2359 of the Italian Civil Code, spective application of the new basis of measurement
current market assessment of the time value of money and the specific risks of the and equity investments in other companies. for receivables at amortised cost and the discounting
asset. An impairment loss is recognised if the recoverable amount is less than the net These are measured at cost, represented by the pur- of receivables. INDEPENDENT AUDITORS’ REPORT
carrying amount. chase price, the sums paid for subscription or the value Consequently, financial receivables recognised prior
Impairment losses are reversed if the grounds for recognising them no longer apply. attributed to the contributed assets, including ancillary to 1 January 2016 are carried at their nominal value,
The amount of the reversal cannot exceed the value that would have resulted if the costs. adjusted for impairment losses, if any. If the reasons
impairment loss had never been recognised. No reversals are recognised on goodwill Investments intended to be held for the long term are for impairment subsequently cease to exist, the value
and capitalised expenses. recognised among financial assets. is reversed up to the original value. LUIGI LAVAZZA S.p.A.
Investments are reviewed in order to determine the op- Financial receivables recognised on or after 1 January
erating performance and financial position of the inves- 2016 are measured at amortised cost, taking account Financial Statements
tees. Such analyses are essentially based on the results
achieved by the investees and their equity, as stated in
of the time factor and their presumed realisable value.
Transaction costs, commissions payable and receiva-
at 31 December 2021
their most recent financial statements available. ble, where applicable, and all differences between the ACCOUNTING STATEMENTS
If the difference between the cost and the interest in initial value and nominal value at maturity are includ-
equity held indicates that an investment has become ed in the calculation of amortised cost by using the ef- > Balance Sheet
impaired, it is written down accordingly. Cost is nor- fective interest criterion over the expected duration of > Statement of Profit or Loss
mally reduced if an investee has recorded a loss or the the receivable.
value of an investment has otherwise decreased and It is possible not to apply the amortised cost criterion
profits or other favourable events sufficient to cover the to receivables when its application is not material to a
losses are not expected in the near future. If the rea- true and fair representation. The Company has exer-
sons for impairment subsequently cease to exist, the cised this option for these financial statements. NOTES TO THE FINANCIAL STATEMENTS
original value is reversed.
Investments not classified as fixed assets are measured
at the lesser of purchase cost and realisable value ac- INDEPENDENT AUDITORS’ REPORT
cording to market trends.

164 165 PRINT PDF
Securities Receivables and payables Cash and cash equivalents

Pursuant to Article 12, paragraph 2, of Legislative Pursuant to Article 12, paragraph 2, of Legislative Cash and cash equivalents are recognised at nominal value. Any amounts in foreign currencies are measured at the
Decree No. 139/2015, the Company has opted for pro- Decree No. 139/2015, the Company has opted for pro- current exchange rate at year-end. COMPANY OFFICERS
spective application of the new basis of measurement spective application of the new basis of measurement
GROUP STRUCTURE
for securities at amortised cost and the discounting of for receivables at amortised cost and the discounting
securities. of receivables. LETTER TO SHAREHOLDERS
Securities intended to be held by the Company for the Consequently, receivables recognised prior to the year Accruals and deferrals
long term are classified as fixed assets and measured beginning on 1 January 2016 are carried at their pre- DIRECTORS’ SINGLE REPORT
at amortised cost, where applicable, less any impair- sumed realisable value, which corresponds to the dif- Accruals and deferrals include portions of costs and revenues common to two or more consecutive financial years ON OPERATIONS
ment losses. ference between the nominal amounts of the receiva- whose amount is determined using the accruals concept.
Securities recognised as current financial assets — in- bles, adjusted by bad debt provisions, which are directly
volving temporary investment of excess liquidity that deducted from the items to which they refer, whereas LAVAZZA GROUP
is not intended for being held by the Company for the payables are carried at their nominal values.
long term — are measured at the lesser of purchase Receivables and payables recognised on or after 1 Provisions for risks and charges Consolidated Financial Statements
cost, including ancillary charges recognised on an ac-
crual basis pursuant to OIC 20, and presumable market
January 2016 are measured at amortised cost, consid-
ering the time factor and, in the case of receivables, Provisions for risks and charges are allocated to cover losses or liabilities of a stated nature or certain or probable
at 31 December 2021
value. their presumed realisable value. existence, the amount or date of which could not be identified at year-end. Provisions reflect the best possible esti-
The value at initial recognition is represented by the mate on the basis of available elements.
nominal value, net of all premiums, discounts, allow- Risks for which it is merely possible that a liability will emerge are disclosed in the Notes, without recognising an ACCOUNTING STATEMENTS
Inventories ances and any costs directly attributable to the trans- accrual to a provision for risks and charges. > Consolidated Statement of Financial Position
action that gave rise to the receivable or payable.
Inventories are recognised at the lesser of either pur- Transaction costs, commissions payable and receiva- PROVISIONS FOR PENSION AND SIMILAR BENEFITS > Consolidated Statement of Profit or Loss
chase and/or production cost and expected realisable ble, where applicable, and all differences between the > Consolidated Statement of Comprehensive Income
value based on market trends, taking into account the initial value and nominal value at maturity are includ- Provisions for pension and similar benefits represent amounts set aside for supplementary pension benefits, other
related ancillary selling costs. ed in the calculation of amortised cost by using the ef- than employee termination indemnities, and one-off indemnities due to employees and independent contractors by
The cost of inventories, measured based on the aver- fective interest method. law or contract. > Consolidated Statement of Changes in Equity
age cost for homogeneous category, includes directly It is possible not to apply the amortised cost criterion
connected ancillary charges. The production cost in- when its application is not material to a true and fair PROVISIONS FOR TAXES, INCLUDING DEFERRED
cludes directly attributable costs and the reasonably representation. NOTES TO THE CONSOLIDATED
attributable share of indirect production costs, with the The estimate of the inventory write-down provision is The item refers to liabilities for probable taxes, the amount or date of payment of which is unknown on the basis
inclusion of financial expense up to the limit of the re- based on the Company’s expected impairment losses, of assessments or disputes with the tax authorities. The provision for deferred taxes includes deferred income tax
alisable value of the asset. as determined in light of past experience and also pro- liabilities due to temporary differences between statutory profit and taxable profit. INDEPENDENT AUDITORS’ REPORT
In order to adequately represent the value of inven- spectively considering the probability of counterparty’s
tories in the financial statements, and to take into insolvency, the loss rate in case of insolvency and the
consideration the impairment losses of obsolete and exposure accrued at the moment of default.
slow-moving material, an obsolescence allowance on Any factored receivables are derecognised if, and only if, Employee termination indemnities
inventories has been recognised, which is directly de- essentially all risks associated with the receivable have LUIGI LAVAZZA S.p.A.
ducted from the value of inventories. been transferred. Otherwise, they continue to be car- The provision is determined according to applicable legislation and collective and supplementary company labour
The inventory write-down provision reflects the ried forward, and a financial liability of equal amount is contracts. Law No. 296 of 27 December 2006 (the 2007 Financial Law) introduced the rules for employee termination Financial Statements
Company’s estimate of expected impairment losses, as
determined in light of past experience, as well as the
recognised to account for the advance received. indemnities accrued from 1 January 2007. As a result of the supplementary pension reform:
at 31 December 2021
historic trend and the expected market trend, including > employee termination indemnities accrued up to 31 December 2006 remained with the Company; ACCOUNTING STATEMENTS
following specific actions undertaken by the Company.
> employee termination indemnities accrued from 1 January 2007, at the employee’s discretion, have been allocat- > Balance Sheet
ed to supplementary pension schemes or kept with the Company, which has transferred the indemnities to the > Statement of Profit or Loss
Treasury Fund established by the INPS.
Indemnities accrued from 1 January 2007 continue to be booked to item B9 c) “employee termination indemnities”.
Item C) “employee termination indemnities” of the balance sheet represents the residual provision carried at 31
December 2006, revalued as appropriate in accordance with the law. Item D13) “social security liabilities” includes NOTES TO THE FINANCIAL STATEMENTS
the amount accrued at year-end in respect of the share of employee termination indemnities still to be paid to pen-
sion fund and social security institutions.

166 167 PRINT PDF
Commitments, guarantees and Income taxes for the year Transfer pricing Currency conversion criteria
contingent liabilities
Income taxes are recognised according to an estimate Prices applied in intra-group transactions were de- Transactions in currencies other than the Euro are rec-
Operating events that, despite not having a quantita- of taxable income in application of tax laws in force, termined in accordance with the OECD guidelines ognised at the spot exchange rate. COMPANY OFFICERS
tive influence on assets and liabilities or profit or loss while taking account of applicable exemptions and tax — as set forth by the Company also in the National Assets and liabilities in currencies other than the Euro,
GROUP STRUCTURE
when recognised, could have effects at a later date are credits to which the Company is entitled. Documentation prepared in accordance with Article except non-monetary assets and liabilities (i.e., inven-
disclosed at the end of the Notes. Such items are recog- The Company participates in the national tax consol- 1, paragraph 6, of Legislative Decree No. 471 of 18 tories, tangible and intangible assets, as well as in- LETTER TO SHAREHOLDERS
nised at their nominal value or the actual commitment. idation programme pursuant to Articles 117 and 129 December 1997. In detail, mention should be made that vestments and non-current securities), are analytically
of the Consolidated Law on Income Taxes (TUIR). The on 18 November 2021 the Company signed an Advance adjusted to the exchange rate at year-end, directly rec- DIRECTORS’ SINGLE REPORT
parent company, Finlav S.p.A., acts as consolidating Pricing Agreement for the five-year period 2021-2025 ognised through profit or loss. Any net gains arising ON OPERATIONS
Net revenues and costs company and calculates a single taxable profit or loss with the Italian Revenue Authority concerning the from the year-end exchange rate adjustment for items
for the group of companies participating in tax consol- methods and criteria for calculating the fair market in foreign currency contribute to the formation of the
Sales of goods and services are recognised on an ac- idation, which thus benefit from the ability to set off value of the assets disposed of to its European subsidi- net result for the year and, upon approval of the finan- LAVAZZA GROUP
crual basis, net of adjusting entries such as returns, taxable profit against tax losses in a single return. aries (France, the UK, Sweden and Austria). The afore- cial statements and proposal for the allocation of the
discounts, allowances and premiums, as well as tax- If the Company contributes all of its taxable profit to mentioned Agreement is the result of the renewal of result, are recognised in a restricted reserve until the Consolidated Financial Statements
es directly associated with sale and any changes in
estimates.
tax consolidation, it recognises a payable to the parent
company equal to the corporate income tax (IRES) to
the previous Advance Pricing Agreement signed on 12
December 2013 for the three years 2013, 2014 and 2015,
profit is realised.
at 31 December 2021
Sales of products are recognised at the time ownership be paid, as determined according to the consolidation subsequently further renewed on 19 December 2016 for
is transferred, which normally coincides with shipment contract. the five-year period 2016-2020. As part of this renewal
or delivery. process, the transactions regarding the French subsid- ACCOUNTING STATEMENTS
Service revenues are recognised when the services are The payable for regional production tax (IRAP) is iary Carte Noire S.a.s. were included. > Consolidated Statement of Financial Position
completed, or on an ongoing basis to the extent that booked to tax payables, net of any prepayments made As part of the second renewal, the German subsidiary
the services in question have been rendered during the during the year. Lavazza Deutschland GmbH was excluded from the > Consolidated Statement of Profit or Loss
year. scope of the agreement in question, as it was already > Consolidated Statement of Comprehensive Income
Costs and expenses are recognised on an accrual basis, Deferred tax assets and liabilities are calculated subject to a separate procedure (initiated by applica-
net of adjusting entries such as returns, discounts, al- based on temporary differences between the carrying tion dated 27 November 2014) aimed at entering into a
lowances and premiums and any changes in estimates. amounts of assets and liabilities according to Italian bilateral advance pricing agreement between Italy and > Consolidated Statement of Changes in Equity
GAAP and their value for tax purposes. Such assets and Germany.
liabilities are measured by taking account of the tax In addition, on 15 December 2016, an application was
Dividends rate that the Company is expected to bear in the year filed for a bilateral Advance Pricing Agreement between NOTES TO THE CONSOLIDATED
in which the differences concerned will contribute to Italy and the United States to govern the transactions
Dividends are recognised in the year in which the inves- taxable profit or loss, considering the tax rates in effect with the U.S. subsidiary Lavazza Premium Coffees Corp.
tee resolves on dividend distribution. or already enacted at the reporting date. In this regard, it should be noted that the competent INDEPENDENT AUDITORS’ REPORT
Deferred tax assets are recognised for all deductible tax authorities met to reach a prior agreement for the
temporary differences, based on the prudence princi- definition of transfer prices between Italy and the USA
Financial income and expense ple, when there is reasonable certainty of taxable infor the five-year period 2016-2020. This agreement was
come of no less than the amount of the differences to formalised and signed with the US tax authorities in
All financial income and expense associated with the be offset during the years in which those differences December 2019. LUIGI LAVAZZA S.p.A.
Company’s financial operations are recognised on an will be reversed. This bilateral agreement is currently being renewed for
accrual basis. Deferred tax liabilities are instead recognised on all the next five-year period 2021-2025. Financial Statements
Gains and losses on the translation of items in foreign
currencies are booked to item C.17-bis) “Exchange gains
taxable temporary differences.
Deferred tax liabilities on tax-suspended reserves and
at 31 December 2021
and losses” of the statement of profit or loss. provisions are recognised when it is expected that the ACCOUNTING STATEMENTS
reserves will be distributed or otherwise used, and
the distribution or use of the same will give rise to tax > Balance Sheet
charges. > Statement of Profit or Loss


168 169 PRINT PDF
Derivatives
In the course of its business, the Company is exposed to the following market risks: The hedging relationship is formally designated when the hedging instrument is con-
tracted and is maintained until the maturity of the contract, unless the hedge is rene- COMPANY OFFICERS
> interest rate risk: this risk is tied to the variability of interest rates payable on float- gotiated or unwound in advance.
GROUP STRUCTURE
ing-rate financing and lease contracts, driven by the fluctuation of market interest
rates (Euribor); A hedging instrument is designated for accounting purposes for its full fair value. LETTER TO SHAREHOLDERS
Consequently, the full fair value of such instruments is considered when determining
> exchange risk: this risk is tied to the variability of revenue and costs denominated the effective portion of the hedge to be recognised in equity, according to cash flow DIRECTORS’ SINGLE REPORT
in foreign currencies, driven by the fluctuation of the exchange rates between the hedging rules. ON OPERATIONS
Euro and the respective foreign currencies; at present, the main exposure to for-
eign-exchange risk relates to the risk tied to purchases of green coffee denominat- Foreign-exchange risk is managed in the case of both the primary source of exposure,
ed in U.S. dollars (USD); i.e., purchases of green coffee denominated in U.S. dollars, and sales in foreign cur- LAVAZZA GROUP
rencies on various international markets (directly to customers/distributors or indi-
> price risk: the risk associated with the variability of the cost of purchasing green rectly through trading companies). Consolidated Financial Statements
coffee, driven by the performance of market coffee prices quoted on the major
international markets.
The Company avails itself of the following types of derivatives to mitigate this risk: FX
forwards, FX options and option structures.
at 31 December 2021
Price risk is managed in the case of the exposure resulting from the purchases of
In this framework, the Company regularly enters into derivatives (interest-rate swaps, green coffee, the price of which is fixed with commodity suppliers on the basis of
FX forwards, FX options, commodity futures, commodity forwards and swaps, and market quotations for coffee futures contracts on the major international exchanges. ACCOUNTING STATEMENTS
commodity options) with the aim of mitigating its exposure to the risks described, in Raw material purchasing costs are therefore exposed to the risk of fluctuation of pric- > Consolidated Statement of Financial Position
accordance with the established risk management objectives and strategies, formally es on the futures market of reference until the date of the fixing of the benchmark
defined in the Group’s policies and procedures. price with the supplier, when all components of the purchase price become known > Consolidated Statement of Profit or Loss
Within the framework of Italian GAAP (OIC), the accounting treatment of derivatives and no longer subject to modification. > Consolidated Statement of Comprehensive Income
is subject to OIC 32 – Derivatives, which contains specific provisions that govern the The Company avails itself of the following types of derivatives to mitigate this risk:
representation in the financial statements of transactions entered into for hedging commodity futures, commodity forwards and swaps, commodity options and option
purposes (i.e., hedge accounting). structures. > Consolidated Statement of Changes in Equity
In accordance with OIC 32, the general rule that applies to the accounting treatment In the tables on derivatives reported in this document, notional values are expressed
of derivatives calls for representation in the balance sheet at fair value, with changes in Euro at the date contracts on such instruments were entered into.
in value recognised periodically in the statement of profit or loss. NOTES TO THE CONSOLIDATED
If the derivatives have been entered into for hedging purposes and certain formal and
substantive requirements have been met (the hedging relationship is documented
and the efficacy of the hedge has been periodically proved), hedge accounting may INDEPENDENT AUDITORS’ REPORT
be applied. In essence, the purpose of hedge accounting is to align the timing and
approach to recognising the economic effects of hedging derivatives with those of the
underlying hedged transactions.
Interest-rate risk management currently involves the use of interest-rate swap (IRS)
contracts, whereby the interest rates on the underlying liabilities (loans or leases) are LUIGI LAVAZZA S.p.A.
transformed from floating to fixed.
Derivatives contracted to hedge against interest-rate risk pursue the objective of fixing Financial Statements
the expected value of the future interest flows generated by the underlying liabilities.
Accordingly, for the purposes of OIC 32, they qualify for cash flow hedge accounting
at 31 December 2021
treatment. ACCOUNTING STATEMENTS
> Balance Sheet


170 171 PRINT PDF
Balance Sheet - Assets

Fixed assets COMPANY OFFICERS
GROUP STRUCTURE
Intangible fixed assets LETTER TO SHAREHOLDERS
The following tables report changes in intangible assets: DIRECTORS’ SINGLE REPORT
ON OPERATIONS
BALANCE AT MERGER INCREASES RECLASSIFICATION (DECREASES) BALANCE AT
01.01.2021 31.12.2021
Development costs
Gross value 13,734,966 - - 3,171,262 - 16,906,228 LAVAZZA GROUP
Write-ups - - - - - -
(Write-down provision) (170,776) - - - - (170,776) Consolidated Financial Statements
(Accumulated amortisation)
Net value
(9,262,542)
4,301,648
-
-
(1,798,965)
(1,798,965)
-
3,171,262
-
-
(11,061,507)
5,673,945
at 31 December 2021
Industrial patent and intellectual
property rights
Gross value 1,103,254 1,743,431 37,477 - - 2,884,162
Write-ups - - - - - -
(Write-down provision) - - - - - - > Consolidated Statement of Financial Position
(Accumulated amortisation) (772,136) (90,182) (362,360) - - (1,224,678)
Net value 331,118 1,653,249 (324,883) - - 1,659,484
Concessions, licenses and similar rights > Consolidated Statement of Comprehensive Income
Gross value 185,960,310 422,570 459,024 40,409 - 186,882,313 > Consolidated Statement of Cash Flows
Write-ups - - - - - -
(Write-down provision) - - - - - - > Consolidated Statement of Changes in Equity
(Accumulated amortisation) (61,061,814) (16,456) (9,122,256) - - (70,200,526)
Net value 124,898,496 406,114 (8,663,232) 40,409 - 116,681,787
Trademarks NOTES TO THE CONSOLIDATED
Gross value 154,099,219 8,024 - - - 154,107,243
Write-ups 303,949,656 - - - - 303,949,656
(Write-down provision) (3,623,965) - - - - (3,623,965) INDEPENDENT AUDITORS’ REPORT
Net value 102,468,318 5,236 (7,115,257) - - 95,358,297
Goodwill
Gross value 371,426,371 823,147 - - - 372,249,518
Write-ups - - - - - - LUIGI LAVAZZA S.p.A.
(Write-down provision) (4,894,056) - - - - (4,894,056)
(Accumulated amortisation) (95,919,773) - (17,939,994) - - (113,859,767) Financial Statements
Net value 270,612,542 823,147 (17,939,994) - - 253,495,695
at 31 December 2021
Intangible assets in process and advances
Gross value 8,859,339 - 20,421,693 (21,790,935) - 7,490,097 ACCOUNTING STATEMENTS
Net value 8,859,339 - 20,421,693 (21,790,935) - 7,490,097
> Balance Sheet
Other intangible assets > Statement of Profit or Loss
Contents of the
Gross value 62,195,743 - 134,922 18,579,264 - 80,909,929
Write-ups - - - - - -
(Accumulated amortisation) (27,805,532) - (10,216,753) - - (38,022,285)
Notes to the
Net value 34,390,211 - (10,081,831) 18,579,264 - 42,887,644 NOTES TO THE FINANCIAL STATEMENTS
Total intangible assets
Gross value 797,379,202 2,997,172 21,053,116 - - 821,429,490
Write-ups 303,949,656 - - - - 303,949,656
(Write-down provision) (8,688,798) - - - - (8,688,798)
Net value 545,861,672 2,887,746 (25,502,468) - - 523,246,950 SUSTAINABLE SINGLE PAGE
172 173 PRINT PDF
The reclassification of “development costs” amounting to €3,171,262 mainly includes Tangible assets
investments made in technological innovation for the development of recyclable and
compostable packaging, which began during the previous year and ended in 2021. Movements in tangible assets and their accumulated depreciation are given in the following tables:
COMPANY OFFICERS
The increase in “industrial patent and intellectual property rights”, amounting to
GROUP STRUCTURE
€37,477, refers mainly to registration costs and territorial extension of a number of BALANCE AT MERGER INCREASES RECLASSIFICATION (DECREASES) BALANCE AT
01.01.2021 31.12.2021
patents previously held by the company Caffemotive S.r.l. which was merged by in- LETTER TO SHAREHOLDERS
corporation during the year. Land and buildings
Gross value 111,148,533 - 17,200 824,649 (3,228,746) 108,761,636 DIRECTORS’ SINGLE REPORT
The increase in “concessions, licenses and similar rights”, amounting to €459,024, and Write-ups 40,225,155 - - - (5,004,440) 35,220,715 ON OPERATIONS
(Write-down provision) (8,369,083) - (1,606,933) - 3,124,371 (6,851,645)
reclassifications amounting to €40,409 are chiefly attributable to licenses for software
(Accumulated depreciation) (59,214,037) - (1,942,709) - 5,027,160 (56,129,586)
for long-term use.
LAVAZZA GROUP
Net value 83,790,568 - (3,532,442) 824,649 (81,655) 81,001,120
Plant and machinery
The increase in "intangible assets in process and advances" of €20,421,693 mainly Gross value 562,299,630 855,448 1,125,691 19,265,769 (8,080,461) 575,466,077
refers to advance payments on orders in progress relating to new long-term soft- Write-ups 108,327,286 - - - (4,524) 108,322,762 Consolidated Financial Statements
ware and development costs; the reclassification of €21,790,935 is attributable: (i) for
€18,435,137 to IT costs relating to the development of software projects for long-term
(Write-down provision)
(Accumulated depreciation)
(802,444)
(459,877,947)
-
(255,517)
(538,057)
(22,987,258)
-
-
25,065
5,769,345
(1,315,436)
(477,351,377)
at 31 December 2021
use, (ii) for €3,171,262 to the capitalisation of development costs for technological in- Net value 209,946,525 599,931 (22,399,624) 19,265,769 (2,290,575) 205,122,026
novation in the field of machines (for example Telemetry) and (iii) for €184,536 for the Industrial and commercial equipment
extraordinary maintenance of the Business Centre located in Turin. Gross value 185,353,337 - 12,983,667 674,592 (12,756,792) 186,254,804 ACCOUNTING STATEMENTS
Write-ups 1,165,417 - - - - 1,165,417
(Write-down provision) (6,801,717) - (655,515) - 1,316,713 (6,140,519) > Consolidated Statement of Financial Position
The increase in "other intangible assets" of €134,922 and reclassifications of (Accumulated depreciation) (122,589,150) - (23,610,419) - 10,800,215 (135,399,354)
€18,579,264 are attributable to the capitalisation of IT costs relating to the internal > Consolidated Statement of Profit or Loss
Net value 57,127,887 - (11,282,267) 674,592 (639,864) 45,880,348
development of unprotected software projects for long-term use (€18,394,728) and Furniture and fittings > Consolidated Statement of Comprehensive Income
the extraordinary maintenance of the Business Centre located in Turin (€184,536). Gross value 26,429,422 2,185 622,819 125,939 (1,566,048) 25,614,317
Write-ups - - - - - -
During the year, following the merger by incorporation of the subsidiary Caffemotive (Write-down provision) (108,566) - - - 91,933 (16,633) > Consolidated Statement of Changes in Equity
S.r.l., a net increase from the merger of €2,887,746 was generated, mainly allocated to: (Accumulated depreciation) (17,980,464) (2,185) (1,461,375) - 1,474,115 (17,969,909)
Net value 8,340,392 - (838,556) 125,939 - 7,627,775
> patents for €1,653,249; Means of transport

Gross value 879,006 - - - (8,863) 870,143 NOTES TO THE CONSOLIDATED
> concessions, licences, and know-how for €406,114;
Write-ups - - - - - - FINANCIAL STATEMENTS
> goodwill for €823,147;
> trademarks for €5,236. (Accumulated depreciation) (719,450) - (17,162) - 8,863 (727,749) INDEPENDENT AUDITORS’ REPORT
Net value 159,556 - (17,162) - - 142,394
The following tables shows the useful lives of fixed assets: Electronic machinery
2021 Gross value 26,185,301 4,682 515,634 16,047 (566,315) 26,155,349
Write-ups - - - - - -
Start-up and expansion costs 5 years (Write-down provision) - - - - - - LUIGI LAVAZZA S.p.A.
Industrial patent rights 5 years (Accumulated depreciation) (22,955,145) (3,443) (1,410,064) - 536,641 (23,832,011)
Rights to use intellectual property 3 years

Net value
Tangible assets in process and
3,230,156 1,239 (894,430) 16,047 (29,674) 2,323,338
Licenses and similar rights 5 years advances at 31 December 2021
Know-how 20 years (*) Gross value 12,755,981 - 31,248,471 (20,906,996) - 23,097,456
Trademarks 10-20 years (*) Write-ups - - - - - - ACCOUNTING STATEMENTS
Goodwill 10-20 years (*) > Balance Sheet
(Accumulated depreciation) - - - - - -
Key money lease period
Net value 12,755,981 - 31,248,471 (20,906,996) - 23,097,456 > Statement of Profit or Loss
Other 3-5-7 years Total tangible assets
Gross value 925,051,208 862,315 46,513,482 - (26,207,225) 946,219,780 > Statement of Cash Flows
(*) The useful life of the intangible assets acquired with the Carte Noire business unit has been estimated at 20 years. This assessment is support-
Write-ups 149,717,858 - - - (5,008,964) 144,708,894
ed by the leading position of the Carte Noire brand in France and the sector of reference, which is stable and does not present particular factors
(Write-down provision) (16,081,808) - (2,800,507) - 4,558,082 (14,324,233)
of technological obsolescence.
(Accumulated depreciation) (683,336,193) (261,145) (51,428,987) - 23,616,339 (711,409,986)
Net value 375,351,065 601,170 (7,716,012) - (3,041,768) 365,194,455

174 175 PRINT PDF
The item "land and buildings" increased mainly due The item "furniture and fittings" increased for purchas- The following tables shows the useful lives of fixed assets:
to the completion during the year of a car park at the es during the year amounting to €622,819 and for re-
Gattinara plant, the construction of which had begun classifications amounting to 2021
in the previous year (€721,627). The net decreases of €125,939, related to purchases during the year and Buildings 60 years COMPANY OFFICERS
€81,655 refer to the reclassification under “Assets held the closure of advances relating to fixtures and fit- Civil buildings 80 years
GROUP STRUCTURE
for sale” of a building located in Turin for which a pre- tings of structures that saw the Company take part as Light buildings 15 years
liminary contract of sale was entered into during the a "Platinum Partner" during the first Nitto ATP tennis Canteen equipment and espresso machines 4 years LETTER TO SHAREHOLDERS
year. Finals, held in November 2021 in Turin. Generic and café equipment 2 years and 6 months
Specific furnishings 10 years
The item "plant and machinery" increased: (i) by The €515,634 increase in “electronic machinery” pri- Generic furnishings 8 years 4 months ON OPERATIONS
€1,125,691 as a result of purchases of industrial ma- marily relates to purchases of computers and IT Generic plant and machinery 20/25 years
chinery and (ii) by €19,265,769 due to the entry into op- equipment. Specific plant 8 years and 4 months
eration of a new capsule packaging line and a coffee The net decrease, amounting to €29,674, relates to the High-tech plant and machinery 10/15 years LAVAZZA GROUP
transport system serving roasting machines. disposal of obsolete equipment. Electronic office equipment 5 years
The net decreases, amounting to €2,290,575, refer to Espresso machines for the Ho.Re.Ca. sector 4 years Consolidated Financial Statements
at 31 December 2021
the disposal of obsolete production lines in favour of The increase in "tangible assets in process and ad- FOL close system machines 5/6 years
the new investments previously described. vances" of €31,248,471 refers to operating costs for the Moulds 3/5/7 years
The net increase from the merger, amounting to purchase of plant and equipment and reclassifications Iron silos 25 years
€599,931, is attributable to machinery and plant of the of €20,906,996 are attributable: (i) for €19,265,769 to Trucks 12 years
merged company Caffemotive S.r.l. the construction of new production lines and industri- Motor cars 8 years ACCOUNTING STATEMENTS
al plant and (ii) for €1,641,227 to the purchase of new > Consolidated Statement of Financial Position
The item “industrial and commercial equipment”, moulds and industrial equipment and special adapta-
which includes coffee machines and moulds held by tions of industrial plant, including the construction of Pursuant to Article 10 of Law No. 72 of 19 March 1983, the following is a statement of the write-ups applied to assets > Consolidated Statement of Profit or Loss
third-party suppliers for the production of machine the car park described above. still carried at 31 December 2021: > Consolidated Statement of Comprehensive Income
components, increased as a result of purchases for the During the year, depreciation totalled €2,800,507,
Re. Law Re. Law Re. Law Re. Law Re. Law Re. Law Re. Law Re. Law Re. Law TOTAL > Consolidated Statement of Cash Flows
year amounting to €12,983,667, chiefly relating to the mainly referring to the write-down of the Company's
576/75 72/83 408/90 413/91 342/00 350/03 266/05 185/08 104/20
installation of Firma machines in the OCS sector and of industrial buildings, machinery and equipment. > Consolidated Statement of Changes in Equity
espresso machines at the cafés within the Food Service The Directors’ Single Report on Operations provides Buildings 28,034 68,682 - 2,519,706 - - - 32,604,293 - 35,220,715
sector, in addition to reclassifications amounting to detailed information on investments made during the Plant and
23,451 296,679 - - 31,464,847 9,677,523 - - 66,860,262 108,322,762
machinery
€674,592, primarily attributable to advances for mould year. NOTES TO THE CONSOLIDATED
Moulds - - - - 187,476 977,941 - - - 1,165,417
purchases. Motor
- - - - - - - - - - FINANCIAL STATEMENTS
The net decreases of €639,864 mainly refer to the dis- vehicles
posal of “Firma” system espresso machines and cap- Lavazza
- - 46,481,121 - 77,468,535 100,000,000 80,000,000 - - 303,949,656 INDEPENDENT AUDITORS’ REPORT
sule machines loaned for the use of customers. trademark
Total 51,485 365,361 46,481,121 2,519,706 109,120,858 110,655,464 80,000,000 32,604,293 66,860,262 448,658,550
The Company is located in the property complex that houses the Group’s headquarters, named “Nuvola Lavazza”,
as well as the Lavazza Museum, the Historical Archive, the convention centre “La Centrale”, the Piazza, the under- LUIGI LAVAZZA S.p.A.
ground parking lot and the IAAD (Institute of Applied Art and Design), under a finance lease, which transfers most
of the risks and rewards associated with the properties in question. Financial Statements
at 31 December 2021
> Balance Sheet


176 177 PRINT PDF
The effect on the balance sheet and profit for the year of the adoption of the finance lease method to account for Financial assets
leased property is illustrated below:
AMOUNT INVESTMENTS COMPANY OFFICERS

ASSETS GROUP STRUCTURE
a) Agreements in force: Investments at 31 December 2021 were broken down as follows:
Assets under finance lease at the end of the previous year 105,139,886 LETTER TO SHAREHOLDERS
+ Goods acquired under finance leases during the year - COMPANY NAME HISTORIC PRIOR VALUE AT INCREASES MERGER DECREASES WRITE- VALUE AT
- Assets under finance lease redeemed during the year -
COST YEARS' 01.01.2021 DOWNS 31.12.2021 DIRECTORS’ SINGLE REPORT
WRITE- FOR THE
- Depreciation charges accrued during the year (3,510,415) DOWNS YEAR
ON OPERATIONS
+/– Value adjustments/reversals on assets under finance leases -
Subsidiaries
Assets under finance lease at the end of the year, net of depreciation 101,629,471
LAVAZZA GROUP
Lavazza Australia
4,804,617 - 4,804,617 - - - - 4,804,617
Pty Ltd
b) Redeemed assets Lavazza Argentina S.A. 7,179,991 (7,179,991) - - - - - -
Total greater value of redeemed assets - Lavazza Capital S.r.l. 476,400,000 - 476,400,000 - - - - 476,400,000 Consolidated Financial Statements
c) Liabilities
Lavazza Coffee (UK) Ltd
Lavazza Deutschland
14,843 - 14,843 - - - - 14,843
at 31 December 2021
Constructive payables for finance lease transactions at the end of the previous year 75,943,797 153,227 - 153,227 - - - - 153,227
G.m.b.H.
+ Constructive payables arisen during the year - Lavazza do Brasil Ltda 28,045,098 (28,045,098) - - - - - -
- Repayment of portions of principal and redemptions made during the year (4,368,330) Lavazza France S.a.s. 27,939,862 - 27,939,862 - - - - 27,939,862 ACCOUNTING STATEMENTS
Constructive payables for finance lease transactions at the end of the year 71,575,467 Lavazza Kaffee
163,854 - 163,854 - - - - 163,854
G.m.b.H. > Consolidated Statement of Financial Position
d) Reversal of prepayments associated with finance leases 18,860,927 Lavazza Maroc S.a.r.l. 904 - 904 - - - - 904
e) Reversal of payables for rent yet to be paid - Lavazza Netherlands B.V. 132,000,000 (108,376,989) 23,623,011 - - - (2,731,408) 20,891,603
Lavazza Japan GK - - - 343,495 - - - 343,495 > Consolidated Statement of Comprehensive Income
f) Total gross effect at the end of the year (a + b - c - d - e) 11,193,076 Lavazza Premium
Coffees Corp.
1,164,635 - 1,164,635 - - - - 1,164,635 > Consolidated Statement of Cash Flows
Lavazza Professional > Consolidated Statement of Changes in Equity
g) Tax effect (3,122,868) 75,500,000 - 75,500,000 19,000,000 - - - 94,500,000
Holding EU S.r.l.
Lavazza Professional
345,111,011 - 345,111,011 56,239,550 - - - 401,350,561
h) Effect on equity at the end of the year (f - g) 8,070,208 Holding NA Inc.
Lavazza Spain S.L. 13,079,422 (12,531,699) 547,723 - - - - 547,723 NOTES TO THE CONSOLIDATED
Effect on the statement of profit or loss - Lavazza Sweden AB 1,855,000 - 1,855,000 - - - - 1,855,000 FINANCIAL STATEMENTS
Reversal of rent on finance leases 5,837,619 Lavazza Trading
1,000,000 - 1,000,000 - - - - 1,000,000
(Shenzhen) Co. Ltd INDEPENDENT AUDITORS’ REPORT
Recognition of financial expense on finance leases (1,878,933) Caffemotive S.r.l. 2,366,356 - 2,366,356 25,172 (2,391,528) - - -
Recognition of: Cofincaf S.p.A. 3,063,719 - 3,063,719 - - - - 3,063,719
- Depreciation charges: Merrild Kaffe ApS 12,119,140 - 12,119,140 - - - - 12,119,140
· on contracts in force (3,510,415) Carte Noire S.a.s. 104,444,203 - 104,444,203 - - - - 104,444,203
· on redeemed goods - Kicking Horse Coffee
Co. Ltd
116,061,395 - 116,061,395 - - - - 116,061,395 LUIGI LAVAZZA S.p.A.
- Value adjustments/reversals on assets under finance lease -
Effect on pre-tax result 448,271
Nims S.p.A.
Total subsidiaries
63,066,869 - 63,066,869
1,415,534,146 (156,133,777) 1,259,400,369
19,146
75,627,363 (2,391,528)
- -
-
- 63,086,015
(2,731,408) 1,329,904,796
Recognition of the tax effect
Effect on profit or loss of recognition of finance leases
(125,068)
323,204
Associates at 31 December 2021
Y&L Coffee Ltd 6,237,747 - 6,237,747 30,271,580 - - - 36,509,327
International Coffee ACCOUNTING STATEMENTS
25,000 - 25,000 - - - - 25,000
Partners G.m.b.H.
> Balance Sheet
Total associates 6,262,747 - 6,262,747 30,271,580 - - - 36,534,327
Other companies
Casa del Commercio e > Statement of Cash Flows
6,094 - 6,094 - - - - 6,094
Turismo S.p.A.
Connect Ventures
6 - 6 - - - - 6
One LP
Consorzio Nazionale NOTES TO THE FINANCIAL STATEMENTS
- - - 5 - - - 5
Imballaggi
INV A.G. Srl 20,000,000 (12,712,342) 7,287,658 - - - - 7,287,658 STATUTORY AUDITORS’ REPORT
ZKB ZADRUZNA
KRASKA BANKA TRST
- - - 153 - - - 153 INDEPENDENT AUDITORS’ REPORT
Total other companies 20,006,100 (12,712,342) 7,293,758 158 - - - 7,293,916
Total investments 1,441,802,993 (168,846,119) 1,272,956,874 105,899,101 (2,391,528) - (2,731,408) 1,373,733,039
178 179 PRINT PDF
With reference to operating investments, the strate- 4. Caffemotive S.r.l., in the amount of €25,172, relating The following table provides data on the main subsidiaries and associates:
gic focus has generally been confirmed with a view to to an injection of liquidity made before its merger by
bringing a greater consistency between the business incorporation during the year; COMPANY NAME REGISTERED SHARE EQUITY PROFIT (LOSS) FOR % HELD CARRYING
model adopted and the geographical area involved, OFFICE CAPITAL THE YEAR VALUE COMPANY OFFICERS
differentiating the approach according to actual local 5. Nims S.p.A., in the amount of €19,146, due to the Subsidiaries
Lavazza Argentina S.A. Buenos Aires 339,940 25,333 (307,136) 97.54 -
GROUP STRUCTURE
situations and business segments. purchase of certain shares held by minority share-
holders as envisaged at the time of the original Lavazza Australia Pty Ltd * Hawthorn 4,681,780 5,986,525 775,910 100.00 4,804,617 LETTER TO SHAREHOLDERS
Increases for the year following the capitalisation of acquisition in 2017; Lavazza Capital S.r.l. Turin 200,000 486,231,436 2,308,537 100.00 476,400,000
subsidiaries refer to: Lavazza Coffee (UK) Ltd Uxbridge 1,190 6,018,317 2,911,519 100.00 14,843 DIRECTORS’ SINGLE REPORT
6. Y&L Coffee Ltd in the amount of €30,271,580. This Lavazza Deutschland G.m.b.H. Frankfurt 210,000 10,014,446 7,086,025 100.00 153,227 ON OPERATIONS
Lavazza do Brasil Ltda Rio de Janeiro 12,218,151 (682,478) (280,547) 99.53 -
1. Lavazza Professional Holding Europe S.r.l. in the company, in which a 35% interest is held, is the ve-
Lavazza France S.a.s. Boulogne 21,445,313 29,058,125 2,174,581 100.00 27,939,862
amount of €19,000,000; hicle through which Yum China Holdings and the
Lavazza Group entered into a joint venture in 2020
Lavazza Kaffee G.m.b.H.
Lavazza Maroc S.a.r.l.
Vienna
Casablanca
218,019
952
1,524,903
95,347
525,205
9,698
100.00
100.00
163,854
904
LAVAZZA GROUP
2. Lavazza Professional Holding North America Inc. aimed at developing the Lavazza Coffee Shop con-
in the amount of €56,239,550; this increase is part- cept in China. Since then, Lavazza has opened over
Lavazza Netherlands B.V.
Lavazza Premium Coffees Corp.
Amsterdam
New York
111,500,000
34,301,048
20,891,607
28,171,892
(2,731,406)
3,599,466
100.00
93.00
20,891,603
1,164,635
ly due to the waiver of a previously disbursed por-
tion of USD 55 million equal to approximately €45.8
20 stores in China in Shanghai, Hangzhou, Beijing
and Guangzhou.
Lavazza Professional Holding EU S.r.l. Turin 1,000,000 94,752,525 2,029,298 100.00 94,500,000 at 31 December 2021
Lavazza Professional Holding NA West Chester,
million and in part to new liquidity injections of 1 393,594,767 (4,196,339) 100.00 401,350,561
Inc.* PA
USD 12.5 million equal to approximately €10.4 million. The increases for the year relating to other companies Lavazza Japan GK Tokyo 8 (166,037) (754,189) 100.00 343,495
Both injections of liquidity arose from the need of (for a total of €158) arose as part of the merger by in- Lavazza Spagna S.L. Barcelona 1,090,620 728,949 11,035 100.00 547,723 ACCOUNTING STATEMENTS
the two holding companies to financially support the corporation of the company Caffemotive S.r.l. Lavazza Sweden AB Stockholm 9,756 2,593,384 324,068 100.00 1,855,000 > Consolidated Statement of Financial Position
subsidiaries in their respective markets throughout The decreases for the year due to write-downs are Lavazza Trading (Shenzhen) Co. Ltd Shenzhen 1,139,936 1,205,542 (2,807) 100.00 1,000,000
the OCS/Vending sector’s crisis, which generated a entirely attributable to Lavazza Netherlands B.V., Carte Noire S.a.s. Boulogne 103,830,406 118,251,756 9,911,472 100.00 104,444,203 > Consolidated Statement of Profit or Loss
drop in the Away From Home channel’s consump- (€2,731,408) mainly attributable to the write-down of Cofincaf S.p.A. Turin 3,000,000 12,823,552 164,362 99.00 3,063,719 > Consolidated Statement of Comprehensive Income
tion during the Covid-19 pandemic; the investee Fresh & Honest Café Ltd both due to the Kicking Horse Coffee Co. Ltd Invermere 149,374,142 187,811,897 6,961,684 80.00 116,061,395
loss for the year at 31 December 2021 considered to be Merrild Kaffe ApS Middelfart 6,724 11,192,566 221,103 100.00 12,119,140
3. Lavazza Japan GK in the amount of €343,495; this permanent and a partial exchange rate adjustment for Nims S.p.A. Padua 3,000,000 47,388,427 4,892,274 97.40 63,086,015 > Consolidated Statement of Changes in Equity
company was acquired in the year by Lavazza the investee’s assets affected by the durable, negative Y&L Coffee Ltd Hong Kong 105,950,909 87,461,425 (16,378,766) 35.00 36,509,327
Professional Holding North America Inc., as part of trend in the Indian Rupee/Euro exchange rate. (*) These figures refer to the Consolidated Financial Statements of the Company and its subsidiaries.
a reorganisation of the Group’s structure; The decrease for the year, amounting to €2,391,528, NOTES TO THE CONSOLIDATED
relates to the end of Caffemotive S.r.l. following its
merger by incorporation.
The values referring to the investments in companies that prepare their financial statements in foreign currencies INDEPENDENT AUDITORS’ REPORT
are stated in Euro, converted at the exchange rate at 31 December 2021.
With the exception of Lavazza Netherlands B.V. any further negative differences between the carrying amounts of
investments in subsidiaries and the proportional share of equity are not deemed to represent impairment losses.
In order to provide complete information, the table below reports a list of the main indirectly controlled companies: LUIGI LAVAZZA S.p.A.
COMPANY NAME REGISTERED SHARE EQUITY PROFIT (LOSS) THROUGH CARRYING % HELD Financial Statements
OFFICE CAPITAL FOR THE VALUE
PREVIOUS at 31 December 2021
YEAR
Carte Noire Operations ACCOUNTING STATEMENTS
Lavérune 28,523,820 56,342,515 1,038,100 Carte Noire S.a.s. 56,212,128 100
S.a.s.
Lavazza
> Balance Sheet
Fresh & Honest Café Ltd * Chennai 1,084,006 17,043,222 (1,284,171) 20,215,019 99.99
Netherlands B.V. > Statement of Profit or Loss
Merrild Baltics SIA Riga 2,828 2,409,723 760,067 Merrild Kaffe ApS 2,410,172 100
Lavazza Professional > Statement of Cash Flows
Roissy CDG 279,706 (6,604,447) (3,859,597) LPH EU 2,694,173 100
France S.a.s.
Lavazza Professional
Verden 50,000 (545,151) (7,432,417) LPH EU 75,480,570 100
Germany G.m.b.H.
Lavazza Professional (UK) NOTES TO THE FINANCIAL STATEMENTS
Basingstoke 40,562,671 1,073,808 (8,945,828) LPH EU 36,622,368 100
Ltd
(*) These figures refer to the Financial Statements for the year ended at 31 March 2020.

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Receivables
Non-current derivative assets
They consist of:
COMPANY OFFICERS
31.12.2021 31.12.2020 CHANGES The Company is exposed to fluctuations in foreign exchange rates, in particular with regard to the purchase of green
GROUP STRUCTURE
Receivables from subsidiaries 120,553,359 161,541,089 (40,987,730) coffee denominated in USD and sales in countries with currencies other than the Euro.
Other receivables 757,169 788,668 (31,499) In order to reduce the impact of changes in exchange rates on expected cash flows, in accordance with its risk man- LETTER TO SHAREHOLDERS
Total 121,310,528 162,329,757 (41,019,229) agement policy the Company uses derivatives solely for hedging purposes.
The item includes the positive fair value of outstanding derivatives at 31 December 2021 with a duration in excess of DIRECTORS’ SINGLE REPORT
Receivables from subsidiaries include: 12 months, contracted in order to hedge against foreign exchange, commodity and interest rate risks. ON OPERATIONS
> the long-term financial receivable from Lavazza Australia Pty Ltd for the AUD 3,570,431 (€2,286,539) residual
amount of the loan granted in 2015 and renewed in 2020, with automatic annual renewal mechanism and bearing Non-current derivative assets LAVAZZA GROUP
interest at a fixed rate of 1.63% per annum;
NOTIONAL VALUE UNDERLYING FINANCIAL RISK FAIR VALUE HEDGED ASSET / LIABILITY Consolidated Financial Statements
> the long-term financial receivable from Lavazza Australia OCS Pty Ltd for the AUD 13,000,000 (€8,325,329) re-
sidual amount of the loan granted in 2018, with automatic annual renewal mechanism and bearing interest at a
EUR 1,190,080 Exchange rate risk 227 Sales at 31 December 2021
EUR 300,000,000 Interest rate risk 2,162,713 Loan
fixed rate of 5.45% per annum; Total 2,162,940
> the long-term financial receivable from Lavazza Professional Holding Europe S.r.l. for the €39,343,812 residual ACCOUNTING STATEMENTS
amount of the loan granted in 2018, bearing interest at a floating rate benchmarked on the twelve-month Euribor; The following table shows movements for the year: > Consolidated Statement of Financial Position
> the long-term financial receivable from Lavazza Professional Holding North America Inc. for the remaining 31.12.2021 31.12.2020 CHANGES > Consolidated Statement of Profit or Loss
amount of USD 76,156,074, (equal to €66,667,743) granted in 2018, regulated at an interest rate in line with the Derivatives to hedge exchange-rate risk 227 4,855,913 (4,855,686) > Consolidated Statement of Comprehensive Income
applicable federal rates, published by the IRS (Internal Revenue Services) in the US, as required by the Internal Derivatives to hedge commodity risk - 22,972 (22,972)
Revenue Code – Section 482; during the year, the company waived a part of this receivable of USD 55,000,000, as Derivatives to hedge interest-rate risk 2,162,713 - 2,162,713
a capital increase, increasing the value of the investment by the same amount; Total 2,162,940 4,878,885 (2,715,945) > Consolidated Statement of Changes in Equity
> the long-term financial receivable from Lavazza Japan, for the amount of YPY 437,768,549, (equal to €3,300,924)
which during the year was transferred to the Company by the previous parent Company Lavazza Professional NOTES TO THE CONSOLIDATED
Holding North America Inc., regulated at a variable interest rate linked to the twelve-month Libor index. Information on fair value (Article 2427-bis, paragraph 1, No. 2)
The long-term financial receivable from Caffemotive S.r.l. granted in the previous year amounting to €470,304 has The following statement compares the carrying amounts and fair value of long-term financial assets other than INDEPENDENT AUDITORS’ REPORT
been extinguished in the current year, following the company’s merger by incorporation. investments in subsidiaries and associates.
The item “other receivables” consists of financial receivables from Connect Ventures One LP (€757,169), a company NON-CURRENT FINANCIAL ASSETS CARRYING VALUE FAIR VALUE
that invests in European Web business start-ups, and security deposits (€504,458). Investments in other companies:
INV A.G. Srl 7,287,658 13,048,559
Other
Total investments in other companies
6,258
7,293,916
6,258
13,054,817
Other receivables: at 31 December 2021
Financial receivables from subsidiaries 120,553,359 120,553,359
Guarantee deposits 252,711 252,711
Receivables from Connect Ventures One LP 504,458 1,884,231 > Balance Sheet
Total other receivables 121,310,528 122,690,301 > Statement of Profit or Loss


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Current Assets Receivables

COMPANY OFFICERS
The following tables show movements of receivables and their adjustments during the year and the balance at
GROUP STRUCTURE
31 December 2021:
ORIGINAL INCREASES ORIGINAL ACCUMULATED PROVISIONS USES ACCUMULATED EXPECTED
COST (DECREASES) COST DEPRECIATION DEPRECIATION REALISABLE DIRECTORS’ SINGLE REPORT
31.12.2020 31.12.2021 AT 31.21.2020 AT 31.21.2021 VALUE AT
ON OPERATIONS
Inventories
31.12.2021
LAVAZZA GROUP
Trade receivables 108,429,412 13,224,315 121,653,727 6,378,942 1,310,393 (1,108,133) 6,581,202 115,072,525
Receivables from subsidiaries 253,896,380 26,231,922 280,128,302 - - - - 280,128,302
31.12.2021 31.12.2020 CHANGES
Raw materials, ancillaries and consumables 219,141,827 194,304,030 24,837,797

Receivables from associates
Receivables from related
- 284,477 284,477 - - - - 284,477
at 31 December 2021
16,509 577,572 594,081 - - - - 594,081
Accumulated depreciation of raw materials, ancillaries and consumables (3,821,496) (2,721,754) (1,099,742) parties
Receivables from parent
Raw materials, ancillaries and consumables (net value) 215,320,331 191,582,276 23,738,055 - 27,500 27,500 - - - - 27,500
companies
Work-in-process and semi-finished goods 3,089,822 2,219,729 870,093 Tax receivables 8,975,163 7,067,772 16,042,935 - - - - 16,042,935
Accumulated depreciation for work-in-process and semi-finished goods (1,000,000) (1,200,000) 200,000 Deferred tax assets 41,453,828 2,427,624 43,881,452 - - - - 43,881,452 ACCOUNTING STATEMENTS
Work-in-process and semi-finished goods (net value) 2,089,822 1,019,729 1,070,093 Other receivables 8,983,764 (1,838,362) 7,145,402 - - - - 7,145,402
Finished products and goods 110,708,350 113,027,102 (2,318,752) Total 421,755,056 48,002,820 469,757,876 6,378,942 1,310,393 (1,108,133) 6,581,202 463,176,674
Accumulated depreciation of finished products and goods (16,128,640) (15,801,760) (326,880) > Consolidated Statement of Profit or Loss
Finished products and goods (net value) 94,579,710 97,225,342 (2,645,632) All receivables at 31 December 2021 are due within the next financial year. > Consolidated Statement of Comprehensive Income
Total 311,989,863 289,827,347 22,162,516
Advance payments 816,319 876,015 (59,696) > Consolidated Statement of Cash Flows
An adjustment provision totalling €6,581,202 was made at the end of the year to adjust the nominal value of trade
Overall total 312,806,182 290,703,362 22,102,820 receivables, which approximates their amortised cost, to their expected realisable value. > Consolidated Statement of Changes in Equity
The following table shows receivables included in current assets, broken down by geographic area:
The value of inventories amounted to €312,806,182 at 31 December 2021. The increase in the year of €22,102,820 is NOTES TO THE CONSOLIDATED
mainly attributable to the green coffee component, significantly impacted by the increase in market prices recorded
ITALY EU OTHER AMERICAS AUSTRALIA OTHER TOTAL
during 2021.
COUNTRIES EUROPEAN COUNTRIES
At 31 December 2021, inventories were recognised net of an inventory write-down provision totalling €20,950,136
COUNTRIES INDEPENDENT AUDITORS’ REPORT
million set aside for obsolete and slow-moving materials, with particular reference to coffee machines and related
Trade receivables 65,464,902 31,487,445 12,163,216 862,455 - 5,094,507 115,072,525
spare parts, advertising material, plant spares and packaging. During 2021, inventories totalling €5,142,865 were
Receivables from subsidiaries 8,259,220 176,533,870 31,760,091 56,320,420 6,630,119 624,582 280,128,302
scrapped and disposed of. It should be noted that the provision for product warranty (€2,100,000) has been shown
Receivables from associates
under liabilities and this amount has also been reclassified in the results of the comparative year for clarity and - - - - - 284,477 284,477
parties
completeness of presentation. Receivables from parent
594,081 - - - - - 594,081
companies
Receivables from related parties 27,500 - - - - - 27,500 Financial Statements
Tax receivables 13,553,766 2,488,996 - - 173 - 16,042,935
at 31 December 2021
Deferred tax assets 43,881,452 - - - - - 43,881,452
Other receivables 3,717,032 309,444 123,632 2,573,054 - 422,240 7,145,402 ACCOUNTING STATEMENTS
Total 135,497,953 210,819,755 44,046,939 59,755,929 6,630,292 6,425,806 463,176,674
> Balance Sheet


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Receivables from subsidiaries and associates refer to the following companies: In order to optimise the Group’s treasury management, Luigi Lavazza S.p.A. continued to implement its cash-pooling
system including the companies based in the USA and in Spain.
31.12.2021 31.12.2020 CHANGES Receivables of a financial nature from subsidiaries refer to the portion of the interest accrued at 31 December 2021
Trade receivables: on loans issued to subsidiaries and carried partly among financial assets and partly among the positive balances of COMPANY OFFICERS
the current accounts of centralised treasury.
Direct subsidiaries GROUP STRUCTURE
Lavazza Argentina S.A. 283,751 688,116 (404,365)
Lavazza Australia Pty Ltd 5,996,494 11,494,547 (5,498,053) Tax receivables of €16,042,935 may be broken down as follows: LETTER TO SHAREHOLDERS
Lavazza Coffee (UK) Ltd 27,453,501 24,677,672 2,775,829
> VAT receivables of €8,006,487 from Italian and foreign revenue authorities in connection with direct identification DIRECTORS’ SINGLE REPORT
Lavazza Deutschland G.m.b.H. 64,362,764 58,117,946 6,244,818
Lavazza do Brasil Ltda 1,070,751 1,435,819 (365,068) for VAT purposes in the countries concerned; ON OPERATIONS
Lavazza France S.a.s. 9,802,995 - 9,802,995
Lavazza Japan GK 445,591 30,980 414,611 > €3,163,794 for credit for investments in capital goods 4.0 2021 L 178/2020;
Lavazza Kaffee G.m.b.H. 5,800,545 3,773,000 2,027,545 LAVAZZA GROUP
Lavazza Maroc S.a.r.l. 3,867 3,867 - > €1,775,391 for credit for investments in ordinary capital goods 2020 L 160/2019;
Lavazza Netherlands B.V. - 13,758 (13,758) Consolidated Financial Statements
Lavazza Premium Coffees Corp.
Lavazza Spain S.L.
43,621,486
8,473
22,807,852
30,552
20,813,634
(22,079)
> €1,608,685 for Research and Development, IT and IT Green 2021 credit L160/2019 as amended by L 178/2020;
at 31 December 2021
Lavazza Sweden AB 3,687,343 2,143,735 1,543,608 > €932,043 for Research and Development credit 2020 L 160/2019;
Carte Noire S.a.s. 84,646,416 100,814,664 (16,168,248)
Cofincaf S.p.A. 88,918 85,165 3,753 > €356,417 for Art bonus; ACCOUNTING STATEMENTS
Kicking Horse Coffee Co. Ltd 483,744 424,129 59,615
Merrild Kaffe ApS 4,631,723 4,800,162 (168,439)
> €200,000 advertising bonus 2020;
Nims S.p.A. 7,931,659 8,295,110 (363,451) > Consolidated Statement of Profit or Loss
Associates
> €118 for other credits. > Consolidated Statement of Comprehensive Income
Yi Bai Coffee Co. Ltd 284,477 - 284,477
Controlled by the same parent company > Consolidated Statement of Cash Flows
Deferred tax assets are allocated in relation to negative income components, which are deducted after they accrue.
Lavazza Eventi S.r.l. 157,482 - 157,482
Changes, final balance and description are set out in the relevant table in the Notes on "taxes for the year". > Consolidated Statement of Changes in Equity
Lea S.r.l. 45,975 338 45,637
Indirect subsidiaries
The item “other receivables” amounted to €7,145,402 and refers primarily to advances to suppliers of €3,336,258 and
Lavazza Professional France S.a.s. 468,733 59,559 409,174
a term deposit for the trading of listed hedging derivative instruments of €2,344,323. NOTES TO THE CONSOLIDATED
Lavazza Professional Germany G.m.b.H. 2,905,918 324,869 2,581,049
Lavazza Professional NA LLC 2,965,603 633,247 2,332,356 FINANCIAL STATEMENTS
Lavazza Professional (UK) Ltd 2,868,234 410,052 2,458,182
Lavazza Professional (UK) Operating Services Ltd 44,983 183,300 (138,317) INDEPENDENT AUDITORS’ REPORT
Carte Noire Operations S.a.s. 217,021 101,080 115,941
Fresh & Honest Café Ltd
Total trade receivables
173,804
270,452,251
508,498
241,858,017
(334,694)
28,594,234
Current financial assets
Financial receivables:
Subsidiaries
Lavazza Australia OCS Pty Ltd 613,652 201,665 411,987 Derivative assets Financial Statements
Lavazza Australia Pty Ltd
Lavazza France S.a.s.
19,973
-
53,195
4,000,000
(33,222)
(4,000,000) The item includes the positive fair value of outstanding derivatives at the reporting date with a duration of less than 12
at 31 December 2021
Lavazza Japan GK 1,321 - 1,321 months, contracted in order to hedge against foreign exchange, commodity and interest rate risks. ACCOUNTING STATEMENTS
Lavazza Professional France S.a.s. 1,940 2,907,810 (2,905,870) The following table provides a detailed description:
Lavazza Professional Holding EU S.r.l. - 594,566 (594,566) > Balance Sheet
Lavazza Professional Holding NA Inc. 7,895,084 4,226,403 3,668,681
Lavazza Professional (UK) Ltd 1,393,373 - 1,393,373
Derivative assets
Caffemotive S.r.l. - 360 (360) > Statement of Cash Flows
Cofincaf S.p.A. 238,642 54,702 183,940
NOTIONAL VALUE UNDERLYING FINANCIAL RISK FAIR VALUE HEDGED ASSET / LIABILITY
Controlled by the same parent company
Lea S.r.l. 390,624 16,171 374,453 EUR 302,929,632 Exchange rate risk 15,891,403 Sales/Purchases of green coffee NOTES TO THE FINANCIAL STATEMENTS
Total financial receivables 10,554,609 12,054,872 (1,500,263)
Total receivables from subsidiaries 281,006,860 253,912,889 27,093,971
EUR 2,516,343 Commodity risk 188,089 Purchases of green coffee STATUTORY AUDITORS’ REPORT
Total 16,079,492

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The following table shows movements for the year: The item “lease contracts” under “prepayments” refers to the residual share of the upfront payment made upon en-
tering into the finance lease arrangement for the real-estate complex divided into various lots, which are to house
31.12.2021 31.12.2020 CHANGES office and commercial buildings, the museum and parking areas, in addition to the Company’s Headquarters. This
Derivatives to hedge exchange-rate risk 15,891,403 905,910 14,985,493 finance lease is taken to the statement of profit or loss on an accrual basis over the 18-year term of the lease. COMPANY OFFICERS
The breakdown of instalments is as follows: €1,445,230 within one year, €7,226,147 between 1 and 5 years and
Derivatives to hedge commodity risk 188,089 14,391,309 (14,203,220)
GROUP STRUCTURE
Total 16,079,492 15,297,219 782,273 €10,189,550 beyond 5 years.
The item “advertising expenses” under “prepayments” refers primarily to the portion not accrued during the year
Cash and cash equivalents of advance payments made to customers in the Food Service sector for the sponsorship of Lavazza products in the DIRECTORS’ SINGLE REPORT
points of sale. Such costs will be recognised in the statement of profit or loss on a pro-rated basis over the duration ON OPERATIONS
This item consists of cash at bank and post-office accounts, as well as cash in hand and cheques held by logistic of the contract.
hubs, outside contractors and sales areas.
The item "CO2 neutrality" refers to the costs of purchasing green certificates that will be used in subsequent years to LAVAZZA GROUP
The following table provides a detailed description: offset not only the annual emissions of direct greenhouse gases of the Company's offices and plants but also those
relating to the volumes produced and placed on the market. Consolidated Financial Statements
31.12.2021 31.12.2020 CHANGES
The item “derivatives” under “prepayments” refers to the negative change reported by forward points (the difference
at 31 December 2021
Bank accounts 429,642,699 152,854,481 276,788,218
between the spot rate/price on the date of execution of the contract and the relevant contractual forward rate/price)
Post office accounts 3,980,313 528,823 3,451,490
and the time value of derivative contracts hedging against foreign exchange and commodity risks in place at 31
Foreign currency accounts 49,533,133 25,777,722 23,755,411
December 2021. ACCOUNTING STATEMENTS
Cash and valuables on hand 175,156 144,347 30,809
The amounts in question will be fully charged through profit or loss when the hedged costs are recognised. > Consolidated Statement of Financial Position
Total 483,331,301 179,305,373 304,025,928

For the analysis of the main cash flows that generated a €304 million increase in this item compared to the previous Negative change in time value of derivatives > Consolidated Statement of Comprehensive Income
year, reference should be made to the Statement of Cash Flows.
NOTIONAL VALUE UNDERLYING CHANGE IN TIME VALUE HEDGED ASSET / LIABILITY > Consolidated Statement of Cash Flows
Foreign currency accounts consist of USD 51,313,710 and are primarily funded by market purchases, collections of
FINANCIAL RISK
receivables from the U.S. subsidiary Lavazza Premium Coffees Corp. and collections of receivables from foreign cus- > Consolidated Statement of Changes in Equity
tomers, in addition to cash flows arising from the cash-pooling arrangements between Luigi Lavazza S.p.A. and the EUR 35,468,476 Exchange rate risk 62,680 Sales
subsidiaries Lavazza Premium Coffees Corp. and Lavazza Professional North America. EUR 2,913,865 Exchange rate risk 14,690 Sales
EUR 3,881,892 Commodity risk 250,515 Purchases of green coffee
Total 327,885
The currency accounts also consist of cash balances of £13,571,733 fed by the flows deriving from the cash pooling
relationships between Luigi Lavazza S.p.A. and its UK subsidiaries (Lavazza Coffee UK Ltd, Lavazza Professional UK
Ltd, Lavazza Professional Operating Services Limited) and any receivables collected from these same subsidiaries. INDEPENDENT AUDITORS’ REPORT
Prepayments on negative change in time value of derivatives
Prepayments and accrued income 31.12.2021 31.12.2020 CHANGES
Forward points based on spot exchange rate 62,680 13,059 49,621
The item consists of the following: Time value of options on exchange rates 14,690 152,782 (138,092) LUIGI LAVAZZA S.p.A.
Time value of options on commodities 250,515 61,724 188,791
31.12.2021 31.12.2020 CHANGES Total 327,885 227,565 100,320 Financial Statements
Prepayments:
of lease contracts 18,860,927 20,459,573 (1,598,646)
at 31 December 2021
of advertising expenses 4,608,700 5,379,309 (770,609) Property, plant and equipment held for sale ACCOUNTING STATEMENTS
of software leases 2,432,964 1,359,532 1,073,432
Co2 neutrality 1,340,031 - 1,340,031 In accordance with the accounting standard OIC 16 and pursuant to Article 2423-ter, paragraph 3, of the Italian Civil > Balance Sheet
of derivatives 900,824 227,565 673,259 Code, the item “Property, plant and equipment held for sale” has been added to the balance sheet, as item C) V) of > Statement of Profit or Loss
of maintenance contracts 561,188 801,390 (240,202) the current assets section. The item includes the net value of an industrial property located in Baranzate and an
of insurance premiums 243,347 342,353 (99,006) office building located in Turin for which the respective sale agreements were signed for a total of €6,236,337.
Other 969,750 149,254 820,496
Total prepayments 29,917,731 28,718,976 1,198,755
Total prepayments and accrued income 29,917,731 28,718,976 1,198,755 NOTES TO THE FINANCIAL STATEMENTS

188 189 PRINT PDF
Balance Sheet – Equity and Liabilities

COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
Equity
LAVAZZA GROUP
In compliance with the provisions of Article 2427 (7-bis) of the Italian Civil Code, a description of the type, possible
uses, and portion available for distribution is set out in the table below for each reserve: Consolidated Financial Statements
Nature / Description AMOUNT POSSIBILITY AMOUNT AVAILABLE
at 31 December 2021
OF USE FOR DISTRIBUTION
Capital 25,000,000 -
Capital reserves
Share premium account 223,523 ABC 223,523
Revaluation reserves 426,580,270 ABC 426,580,270 > Consolidated Statement of Profit or Loss
Reserve from profits
Legal reserve 5,000,000 B -
Other reserves > Consolidated Statement of Cash Flows
- Extraordinary reserve 211,519,258 ABC 211,519,258
- Reserve Re. Art. 18 Presidential Decree 675/77 16,892 ABC 16,892
- Reserve Re. Art. 55 of Law 526/82 86,235 ABC 86,235
- Reserve Re. Law 46/82 90,785 ABC 90,785
- Reserve Re. Art. 55 Pres. Decree 917/86 212,481 ABC 212,481 NOTES TO THE CONSOLIDATED
- Reserve Re. Law 130/83 162,463 ABC 162,463 FINANCIAL STATEMENTS
- Reserve Re. Law 488/92 380,808 ABC 380,808
(Accumulated amortisation) - B -
- Merger surplus reserve 56,953,074 ABC 56,953,074
Retained earnings 1,545,635,099 ABC 1,545,635,099
Negative reserve for treasury shares (17,732,533) restricted (17,732,533)
Hedge reserve for expected cash flows 40,715,275 restricted 40,715,275
Total
Non-distributable quota*
2,294,843,630 2,264,843,630
5,844,721
Amount available for distribution 2,258,998,909 at 31 December 2021
Legend:
A: for capital increase > Balance Sheet
B: for loss coverage
C: for distribution to shareholders
* equal to the portion of development expenses not yet amortised > Statement of Cash Flows

The changes in the amounts of equity items are described in the attached “Statement of Changes in Equity”.

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Share capital HEDGE RESERVE FOR EXPECTED CASH FLOWS
Fully subscribed and paid-up share capital consists of 25,000,000 ordinary shares, with a nominal value of €1 each. This reserve refers to changes in the fair value of the effective component of derivatives hedging cash flows.
COMPANY OFFICERS
The following table shows movements for the year:
GROUP STRUCTURE
Revaluation reserves
31.12.2019 INCREASES DECREASES DEFERRED DEFERRED 31.12.2020 INCREASES DECREASES DEFERRED DEFERRED 31.12.2021 LETTER TO SHAREHOLDERS
Revaluation reserves are detailed as follows (euro): FOR FOR FAIR TAX TAX ASSETS FOR FAIR FOR FAIR TAX TAX
FAIR VALUE VALUE LIABILITIES VALUE VALUE LIABILITIES ASSETS DIRECTORS’ SINGLE REPORT
CHANGES CHANGES CHANGES CHANGES
31.12.2021 ON OPERATIONS
Derivatives
Re. Law 576/75 * 28,033 to hedge
(1,188,893) 3,684,219 (18,669,151) - 4,417,249 (11,756,576) 27,767,876 (2,895,297) - (3,730,631) 9,385,372
exchange-rate
Re. Law 72/83 ** 267,518
Re. Law 408/90 25,096,319
risk
Derivatives
LAVAZZA GROUP
Re. Law 413/91 5,680,818 to hedge 11,089,917 5,328,323 (3,798,355) (3,520,948) - 9,098,937 43,331,443 (9,516,588) (11,972,948) - 30,940,844
commodity risk
Re. Law 342/2000 *** 103,048,413
at 31 December 2021
Derivatives to
Re. Law 448/2001 5,100,000 hedge interest- (3,814,299) 27,346 (1,204,515) - 1,197,952 (3,793,516) 4,305,436 - (122,861) - 389,059
Re. Law 350/2003 **** 93,900,327 rate risk
Re. Law 266/2005 70,400,000 Total 6,086,725 9,039,888 (23,672,021) (3,520,948) 5,615,201 (6,451,155) 75,404,755 (12,411,885) (12,095,809) (3,730,631) 40,715,275
Re. Law 185/2008 58,200,000

Re. Law 104/20 64,858,842
Total revaluation reserves 426,580,270 > Consolidated Statement of Financial Position
At 31 December 2021, €40,715,275 of lower hedging costs that will have an impact in 2022 remained suspended in
* Due to the merger of Luca S.r.l. equity. This item primarily relates to the purchase of commodities and foreign exchange and interest rate hedging. > Consolidated Statement of Profit or Loss
** Due to the merger of Manifattura Rosy S.r.l. (€198,836) and Luca S.r.l. (€68,682). > Consolidated Statement of Comprehensive Income
*** Due to the merger of Mokapak S.r.l. (€5,111,146).
**** Due to the merger of Mokadec S.r.l. (€2,729,700) and Mokapak S.r.l. (€8,813,610).
NEGATIVE RESERVE FOR TREASURY SHARES

In accordance with Legislative Decree of 18 August 2015, implementing Directive 34/2013/EU, amending Article
2357-ter of the Italian Civil Code, in these financial statements the value of treasury shares in portfolio was recog-
nised to a specific negative equity reserve. INDEPENDENT AUDITORS’ REPORT
Treasury shares in portfolio amounted to 2,499,998 ordinary shares, with a nominal value of €1 each, accounting for
approximately 10% of share capital.
No other Lavazza Group company owns Luigi Lavazza S.p.A. shares.

at 31 December 2021
> Balance Sheet


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Statement of changes in equity

COMPANY OFFICERS
SHARE CAPITAL SHARE PREMIUM REVALUATION LEGAL RESERVE OTHER RESERVES HEDGE RESERVE RETAINED PROFIT (LOSS) FOR NEGATIVE RESERVE TOTAL
ACCOUNT RESERVE FOR EXPECTED EARNINGS THE YEAR FOR TREASURY GROUP STRUCTURE
CASH FLOWS SHARES IN
PORTFOLIO LETTER TO SHAREHOLDERS
Balances at 31.12.2019 25,000,000 223,523 361,721,428 5,000,000 261,514,063 6,086,726 1,439,136,282 106,186,603 (17,732,533) 2,187,136,091 DIRECTORS’ SINGLE REPORT
Allocation of profit for the ON OPERATIONS
year
-allocation of dividends
- - - - - - - (50,175,004) - (50,175,004)
LAVAZZA GROUP
(€ 2,23 per share)
-other allocations - - - - 7,907,933 - 48,103,666 (56,011,599) - -
Other changes - - - - - - - - - - Consolidated Financial Statements

-increases - - 64,858,842 - - - - 91,470,155 - 156,328,997 at 31 December 2021
-decreases - - - - - (12,537,881) - - - (12,537,881)
-reclassification - - - - - - - - - - ACCOUNTING STATEMENTS

Result for the previous
year
- - - - - - - - - - > Consolidated Statement of Financial Position
Balances at 31.12.2020 25,000,000 223,523 426,580,270 5,000,000 269,421,996 (6,451,155) 1,487,239,948 91,470,155 (17,732,533) 2,280,752,203 > Consolidated Statement of Profit or Loss
Allocation of profit for the > Consolidated Statement of Comprehensive Income
year
-allocation of dividends > Consolidated Statement of Cash Flows
- - - - - - - (33,075,003) - (33,075,003)
(€ 1,47 per share)
-other allocations - - - - - - 58,395,152 (58,395,152) - -
Other changes - - - - - - - - - -
-increases - - - - - 47,166,430 - 103,604,137 - 150,770,567

-decreases - - - - - - - - - -
-reclassification - - - - - - - - - -
Result for the previous
- - - - - - - - - -
year
Balances at 31.12.2021 25,000,000 223,523 426,580,270 5,000,000 269,421,996 40,715,275 1,545,635,100 103,604,137 (17,732,533) 2,398,447,767
During the year, the retained earnings reserve increased due to the undistributed share of the profit from the previous Financial Statements
year of €58,395,152.
at 31 December 2021
> Balance Sheet


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Provisions for risks and charges

standards, in compliance with the essential requirements of environmental directives
and new technologies, adopting processes and raw materials with low environmental
impact to reduce waste production. The provisions were used for about €4.8 million for
the scrapping of production lines of plastic capsules replaced by the new aluminium COMPANY OFFICERS
The following table provides the breakdown and movements of provisions for risks and charges: capsules with zero environmental impact. Finally, the utilisations, amounting to about
GROUP STRUCTURE
€6 million, were necessary to adjust the provision to the re-evaluated recoverability
31.12.2020 EFFECT OF PROVENTI- PROVISIONS USES - RELEASES 31.12.2021 risks for investments made in the cafe and restaurant channel, which had been strongly LETTER TO SHAREHOLDERS
HEDGING SATIONS FOR THE YEAR FOR THE YEAR affected in the previous year by the restrictive measures to combat the Covid-19 pan-
DERIVATIVES
demic but which during the year showed a recovery, albeit slow and gradual. DIRECTORS’ SINGLE REPORT
Provisions for taxes, including ON OPERATIONS
deferred:
provision for taxes 1,420,000 - - 1,000,526 (953,003) 1,467,523
At 31 December 2021, the provision for sundry personnel costs included the accruals
and uses for employee bonuses and incentives.
provision for deferred tax liabilities
Total provisions for taxes,
3,982,306 13,214,812 - 544,810 (59,875) 17,682,053
The provision for charges for prize competitions represents liabilities arising from LAVAZZA GROUP
5,402,306 13,214,812 - 1,545,336 (1,012,878) 19,149,576 prize competitions organised for the Company’s customers but for which the amount
including deferred
Other provisions: and settlement date were still unknown at the reporting date. Consolidated Financial Statements
provision for legal issues
provision for guarantees and
12,438,834 - - 4,935,000 (1,825,554) 15,548,280
The item provision for restructuring rose by €4 million due to the process of reorganising
at 31 December 2021
6,053,726 - (565,053) - (101,052) 5,387,621
endorsements and rationalising the Lavazza production system, and was partially drawn down to
provision for product warranties 2,100,000 - - 704,954 - 2,804,954
cover the costs incurred during the year.
provision for agents' customer
2,794,874 - (90,334) 229,025 (135,648) 2,797,917 The item “derivative liabilities” includes the fair value of the outstanding derivatives ACCOUNTING STATEMENTS
compensation
provision for future risks and at 31 December 2021. > Consolidated Statement of Financial Position
26,189,262 - (6,051,134) 15,287,128 (4,810,616) 30,614,640
charges
provision for sundry personnel costs 44,945,947 - - 29,688,702 (9,263,496) 65,371,153 The following table provides a detailed description: > Consolidated Statement of Profit or Loss
fund setting up sweepstays 50,000 - - 221,642 - 271,642 > Consolidated Statement of Comprehensive Income
provision for restructuring 713,822 - - 4,000,000 (127,000) 4,586,822
derivative liabilities 19,964,026 (15,923,845) - - - 4,040,181 NOTIONAL VALUE UNDERLYING FAIR VALUE HEDGED ASSET / LIABILITY > Consolidated Statement of Cash Flows
FINANCIAL RISK
Total other provisions 115,250,491 (15,923,845) (6,706,521) 55,066,451 (16,263,366) 131,423,210 > Consolidated Statement of Changes in Equity
Total provisions 120,652,797 (2,709,033) (6,706,521) 56,611,787 (17,276,244) 150,572,786 Current derivative liabilities
on exchange rates EUR 86,749,366 Exchange rate risk 834,600 Sales/Purchases of green coffee
on commodities EUR 37,695,119 Commodity risk 713,501 Purchases of green coffee
The provision for taxes increased in the year by €1 mil- The provision for guarantees and endorsements has Total 1,548,101
lion in relation to a potential risk related to the VAT been established to account for possible future loss- Non-current derivative liabilities
position opened by the Company in Bulgaria. es on loans granted by the subsidiary Cofincaf S.p.A. on exchange rates EUR 72,380,159 Exchange rate risk 220,599 Sales/Purchases of green coffee INDEPENDENT AUDITORS’ REPORT
The decrease of €953,003 refers partly to the tax au- to vending and Ho.Re.Ca. Operators and fully or partly on interest rates EUR 310,000,000 Interest rate risk 2,271,480 Loan
thority’s assessment procedure regarding the 2015 tax guaranteed by the Company.
Total 2,492,079
period, and partly to the payment of fines and inter-
Total 4,040,180
est arising from the higher tax base, as established in The provision for supplementary agents’ customer
the MAP negotiation between the Italian tax authority compensation, created for agent members of Enasarco LUIGI LAVAZZA S.p.A.
and, respectively, the French, British and German tax (National Board for the Assistance to Commercial
authorities, referring to the 2010 tax period. Agents and Representatives) in the event of retirement The Company is exposed to fluctuations in foreign exchange rates, in particular with Financial Statements
The provision for deferred tax liabilities is broken down
or interruption of contract due to principal, was adjusted. regard to the purchase of green coffee denominated in USD and sales in countries
with currencies other than the Euro. In order to reduce the impact of changes in for-
at 31 December 2021
in a specific table included in the Notes on "taxes for The provision for product warranties refers to any eign exchange rates on expected cash flows, in accordance with its risk management ACCOUNTING STATEMENTS
the year." charges that the Company will have to bear to replace policy the Company has recourse to derivatives for hedging purposes.
defective coffee machines under warranty and remedy > Balance Sheet
The provision for legal issues was recognised to ac- any faults. This increased by €704,954 during the year. The price of green coffee is subject to considerable volatility caused by both variables > Statement of Profit or Loss
count for risks relating to labour legal or contractual Starting from 2021, the provision for product warranty relating to physical supply and demand mechanisms (harvest, stocks, consumption
obligations associated with situations that already exist- (€2,100,000) is shown in the provisions section and is and logistical limitations) and speculative activity.
ed at the reporting date, but that were characterised by not net of the value of inventories. For clarity purposes, In order to limit the impact of fluctuations in coffee prices, the Company adopts pro-
a state of uncertainty and the outcome of which depends this reclassification was also carried out in the com- curement policies aimed at reducing price variations, while also engaging in hedging
on the occurrence of one or more future events. During parative year. through financial derivatives, in accordance with its risk management policy. NOTES TO THE FINANCIAL STATEMENTS
the year, the provision was increased by €4 million to During the year, the Company used financial derivatives (cross currency swaps) to
cover charges for litigation with customers and distrib- The provision for future risks and charges increased by ap- transform the fixed-rate intercompany loan in US dollars granted to the subsidiary
utors; the utilisation of €1.8 million refers to the settle- proximately €15 million, mainly to cover the expected costs Lavazza Professional Holding North America Inc., commented on in the section on INDEPENDENT AUDITORS’ REPORT
ment of legal and settlement expenses incurred in the of developing industrial projects to convert production lines receivables from subsidiaries, into a fixed-rate loan in euros.
year but related to disputes arising in previous years. for the production of sustainable packaging. In fact, the
Company is committed to ensuring high product quality SUSTAINABLE SINGLE PAGE
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Liabilities
The following table shows the movements in the year:
31.12.2021 31.12.2020 CHANGES

Current derivative liabilities
COMPANY OFFICERS
Liabilities amounted at €1,126,849,828 at 31 December 2021, broken down as follows:
Derivatives to hedge exchange-rate risk 834,600 14,189,426 (13,354,826) GROUP STRUCTURE
Derivatives to hedge commodity risk 713,501 85,923 627,578
Derivatives to hedge interest-rate risk - - -
31.12.2021 31.12.2020 CHANGES LETTER TO SHAREHOLDERS
Payables to banks 628,988,723 464,439,416 164,549,307
Non-current derivative liabilities DIRECTORS’ SINGLE REPORT
Advance payments 1,482,963 992,830 490,133
Derivatives to hedge exchange-rate risk 220,599 193,620 26,979
Trade payables 277,214,077 203,294,883 73,919,194
ON OPERATIONS
Derivatives to hedge commodity risk - - -
Derivatives to hedge interest-rate risk 2,271,480 5,495,057 (3,223,577) Payables to subsidiaries 119,528,874 125,905,797 (6,376,923)
LAVAZZA GROUP
Total 4,040,180 19,964,026 (15,923,846) Payables to parent company 10,315,835 10,199,264 116,571
Payables to related companies 1,684,896 978,330 706,566
Tax payables
Social security liabilities
6,094,769
5,412,091
8,863,397
5,878,681
(2,768,628)
(466,590)
Other liabilities 76,127,600 58,297,454 17,830,146 at 31 December 2021
Employee termination indemnities Total 1,126,849,828 878,850,052 247,999,776
The item "payables to banks" of €629 million refers to: (i) for €309 million to the residual value of a Corporate Loan ACCOUNTING STATEMENTS
Movements in employee termination indemnities during the year were as follows: (initial value of €400 million), taken out in 2018 at a variable rate (6-month Euribor), then converted into a fixed > Consolidated Statement of Financial Position
rate through an Interest Rate Swap transaction, with a duration of 5 years, which during the year was repaid for €91
Balance at 31.12.2020 after deduction of advance payment tax Re. Law 662/96 12,578,630 million; (ii) for €300 million to a corporate financing contract belonging to the sustainability-linked loan category, > Consolidated Statement of Profit or Loss
Use of indemnities paid in the year (794,062) taken out with a banking pool composed of 4 leading banking institutions in July 2021 that the Company decided to > Consolidated Statement of Comprehensive Income
Advances (81,955) fix through an interest rate swap contract. The start of the capital repayment period has been set in 2024, while the
Revaluation of the year 435,561 loan is scheduled to expire in 2026. The financing operation has been correlated to sustainability targets, which are
Balance at 31.12.2021 12,138,174 observed and measured annually and which allow the company to benefit from reductions in interest pricing; the > Consolidated Statement of Changes in Equity
remaining €20 million refers to a hot money line opened during the year, already partially repaid at the reporting
date.
Employee termination indemnities at 31 December 2021 reflected accrued indemnities due to employees until the NOTES TO THE CONSOLIDATED
date they choose a supplemental pension scheme. This amount will be eliminated with the payments that will take The following table shows the breakdown of payables to banks by maturity:
place when employment relationships terminate or in case of any advances made as per law.
In compliance with Legislative Decree No. 124/93 and subsequent company agreements, €3,832,051 were allocated 31.12.2021 31.12.2020 CHANGES
to the following bodies for financing supplemental pension schemes: Payables to banks
- within one year 175,171,820 155,130,600 20,041,220
DESCRIPTION CURRENCY AMOUNT
Alifond EUR 1,870,065
- beyond one year 453,816,903 309,308,816 144,508,087
Total 628,988,723 464,439,416 164,549,307
Fon.Te. EUR 264,858
Previndai EUR 1,274,086
Open-ended funds EUR 423,042
The following table provides a breakdown by geographic area:
at 31 December 2021
Total EUR 3,832,051
ITALY EU OTHER AMERICAS AUSTRALIA OTHER TOTAL ACCOUNTING STATEMENTS
COUNTRIES EUROPEAN COUNTRIES
> Balance Sheet
COUNTRIES
Payables to banks 628,988,723 - - - - - 628,988,723 > Statement of Profit or Loss
Advance payments 45,510 85,205 353,178 69,713 - 929,357 1,482,963 > Statement of Cash Flows
Trade payables 194,092,788 29,739,963 31,845,445 12,809,143 338,584 8,388,154 277,214,077
Payables to subsidiaries 6,512,993 88,192,216 9,663,102 13,435,871 754,132 970,560 119,528,874
Payables to the Parent Company 1,684,896 - - - - - 1,684,896 NOTES TO THE FINANCIAL STATEMENTS
Payables to related companies 10,315,835 - - - - - 10,315,835
Tax payables 6,088,056 - 6,713 - - - 6,094,769
Social security liabilities 5,412,091 - - - - - 5,412,091 INDEPENDENT AUDITORS’ REPORT
Other liabilities 47,664,613 16,411,085 6,010,160 166,267 - 5,875,475 76,127,600
Total 900,805,505 134,428,469 47,878,598 26,480,994 1,092,716 16,163,546 1,126,849,828
198 199 PRINT PDF
The following table provides a breakdown of payables to subsidiaries: The financial payables shown in the table refer to the negative balances of the Company’s cash pooling system in
which various Group companies participate.
31.12.2021 31.12.2020 CHANGES
Trade payables: Tax payables consist of the following: COMPANY OFFICERS
Direct subsidiaries GROUP STRUCTURE
Lavazza Australia Pty Ltd 395,078 482,943 (87,865) 31.12.2021 31.12.2020 CHANGES
Lavazza Coffee (UK) Ltd 71,036 37,040 33,996 Foreign value-added tax 24,115 279 23,836 LETTER TO SHAREHOLDERS
Lavazza Deutschland G.m.b.H. - 159,829 (159,829) Income tax to be paid as withholding agents 3,053,498 3,098,194 (44,696)
Lavazza do Brasil Ltda - 5,245 (5,245) IRAP (regional production tax) 1,592,059 1,684,182 (92,123)
Lavazza France S.a.s. 109,423 1,894,161 (1,784,738) ON OPERATIONS
IRES (corporate income tax) - 1,980,000 (1,980,000)
Lavazza Kaffee G.m.b.H. - 27,361 (27,361)
Other taxes 1,425,097 2,100,742 (675,645)
Lavazza Maroc S.a.r.l. 95,518 80,792 14,726
Lavazza Netherlands B.V. 58,524 50,807 7,717
Total 6,094,769 8,863,397 (2,768,628)
LAVAZZA GROUP
Lavazza Premium Coffees Corp. 1,211,545 550,668 660,877
Lavazza Spain S.L. 537,645 662,023 (124,378) Consolidated Financial Statements
Lavazza Trading (Shenzhen) Co. Ltd 770,376 545,484 224,892 Tax payables decreased by €2,768,628 due to the payment of higher taxes and related interest arising from the high-
er tax base, as established in the MAP negotiation between the Italian tax authority and, respectively, the French,
at 31 December 2021
Lavazza Japan GK 33,594 - 33,594
Carte Noire S.a.s. 1,968,368 3,532,665 (1,564,297) British and German tax authorities, referring to the 2010 tax period.
Cofincaf S.p.A. 460,084 456,549 3,535
Merrild Kaffe ApS 240,409 164,110 76,299 The item "other liabilities" consists of the following: ACCOUNTING STATEMENTS
Nims S.p.A. 289,739 800 288,939 > Consolidated Statement of Financial Position
Indirect subsidiaries 31.12.2021 31.12.2020 CHANGES
Lavazza Australia OCS Pty Ltd 359,054 793,614 (434,560)
Trade discounts payable 59,872,616 38,036,554 21,836,062
Lavazza Professional (UK) Ltd 668,180 7,236 660,944 Payables to personnel 15,459,283 12,579,634 2,879,649 > Consolidated Statement of Comprehensive Income
Lavazza Professional NA LLC 301,021 - 301,021 Withholding warranty Caffemotive - 619,907 (619,907)
Carte Noire Operations S.a.s. 6,449,357 4,848,094 1,601,263
Deposits received from third parties 521,238 511,843 9,395
Fresh & Honest Café Ltd 71,072 190,193 (119,121) > Consolidated Statement of Changes in Equity
Sundry trade payables 126,042 452,912 (326,870)
Financial debts 41,736 6,020,066 (5,978,330)
Lea S.r.l. 750,000 4,380 745,620
Other 106,685 76,538 30,147
Lavazza Eventi S.r.l. 105,596 49,936 55,660 NOTES TO THE CONSOLIDATED
Chili S.p.A. 4,880 126,285 (121,405) Total 76,127,600 58,297,454 17,830,146
Total trade payables 14,950,499 14,670,215 280,284
Financial payables: INDEPENDENT AUDITORS’ REPORT
Direct subsidiaries The item “trade discounts payables” refers to credit notes to be issued to customers who reached the contractually
Lavazza Coffee (UK) Ltd 8,226,025 5,100,668 3,125,357 established volume or sales targets during the year.
Lavazza Deutschland G.m.b.H. 36,977,921 34,023,081 2,954,840
Lavazza France S.a.s. 11,796,041 6,830,015 4,966,026 Payables to employees relate to the balance of unused holiday and other leaves accrued during the year and pro-
Lavazza Kaffee G.m.b.H. 3,500,862 2,392,016 1,108,846 duction bonuses, partly included in the company welfare programme. LUIGI LAVAZZA S.p.A.
Lavazza Spain S.L. 215,044 - 215,044 The item "Caffemotive S.r.l. withholding warranty", relating to the sum withheld during 2020, from the payment of
Lavazza Premium Coffees Corp. 5,299,826 - 5,299,826 the company's shares, was paid in 2021 to the selling party prior to the company’s merger by incorporation. Financial Statements
Lavazza Professional Holding EU S.r.l. 751,453 1,488,744 (737,291)
The item "financial payables" decreased by €5,978,330, in relation to the movements of cash and cash equivalents
at 31 December 2021
Cofincaf S.p.A. 7,534 775,171 (767,637)
Carte Noire S.a.s. 19,603,578 48,672,145 (29,068,567) deposited with the broker in respect of the positive margin of derivative financial instruments traded on regulated ACCOUNTING STATEMENTS
Nims S.p.A. 5,004,182 2,927,883 2,076,299 markets and held by the Company.
> Balance Sheet
Lavazza Professional Germany G.m.b.H. 4,500,693 3,002,636 1,498,057 > Statement of Profit or Loss
Lavazza Professional (UK) Operating Services Ltd 680,430 1,587,450 (907,020)
Lavazza Professional (UK) Ltd 17,431 787,334 (769,903)
Lavazza Professional France S.a.s. 346,437 - 346,437
Carte Noire Operations S.a.s. 1,887,914 3,829,041 (1,941,127)
Lavazza Professional NA LLC 6,623,480 - 6,623,480
Controlled by the same parent company STATUTORY AUDITORS’ REPORT
Lavazza Entertainment S.r.l. 476,408 492,798 (16,390)
Lavazza Eventi S.r.l. 348,012 304,930 43,082 INDEPENDENT AUDITORS’ REPORT
Total financial payables 106,263,271 112,213,912 (5,950,641)
Total payables to subsidiaries 121,213,770 126,884,127 (5,670,357)
200 201 PRINT PDF
Accruals and deferred income

COMPANY OFFICERS
The following table provides a breakdown of accruals and deferred income: Positive change in time value of derivatives GROUP STRUCTURE
31.12.2021 31.12.2020 CHANGES NOTIONAL VALUE UNDERLYING FINANCIAL RISK CHANGE IN TIME VALUE HEDGED ASSET / LIABILITY LETTER TO SHAREHOLDERS
Accruals:
EUR 992,635 Exchange rate risk 5,750 Sales DIRECTORS’ SINGLE REPORT
14th month salary 3,637,924 3,561,736 76,188
EUR 1,789,306 Commodity risk 95,327 Purchases of green coffee ON OPERATIONS
of interest 60,620 1,592 59,028
101,077
Total accruals 3,698,544 3,563,328 135,216
Deferred income:
on tax relief for plant 5,312,988 2,556,592 2,756,396
LAVAZZA GROUP
on derivatives 101,076 129,843 (28,767)
Deferred income on positive change in time value of derivatives Consolidated Financial Statements
at 31 December 2021
on public contributions 72,000 - 72,000
on franchising entry fees 2,467 82,188 (79,721) 31.12.2021 31.12.2020 CHANGES
Total deferred income 5,488,531 2,768,623 2,719,908 Time value of options on exchange rates 5,750 52,943 (47,193)
Total accruals and deferred income 9,187,075 6,331,951 2,855,124 Time value of options on commodities 95,327 76,900 18,427
Total 101,077 129,843 (28,766)
The item “deferred income on tax relief for plant” refers to the future share of government grants pursuant to Article
1, paragraph 35, of Law No. 190/2014 (Research & Development Bonus), which have been accounted for according to > Consolidated Statement of Profit or Loss
the indirect method, spread over the useful lives of the plants to which the relief applies. > Consolidated Statement of Comprehensive Income
The item “deferred income on derivatives” refers to the positive change reported by forward points (the difference
between the spot rate/price on the date of execution of the contract and the relevant contractual forward rate/
price) and the time value of derivative contracts hedging against foreign exchange and commodity risks in place at > Consolidated Statement of Changes in Equity
31 December 2021. The amounts in question will be fully charged through profit or loss when the hedged costs are
recognised.

at 31 December 2021
> Balance Sheet


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Statement of Profit or Loss Other income and revenues

The item “other income and revenues” was broken down as follows:
COMPANY OFFICERS
YEAR 2021 YEAR 2020 CHANGES
GROUP STRUCTURE
Charge-backs to Group companies 111,050,752 86,493,518 24,557,234 LETTER TO SHAREHOLDERS
Contingent income 9,761,347 9,201,268 560,079
Grants 2,593,457 2,262,988 330,469 DIRECTORS’ SINGLE REPORT
Rentals 1,407,535 1,247,939 159,596 ON OPERATIONS
Value of production Royalties for the use of our trademarks
Income from compensation for damages
983,786
906,125
1,318,986
513,066
(335,200)
393,059
Ordinary capital gains
Other
867,469
2,337,661
239,276
2,639,534
628,193
(301,873)
LAVAZZA GROUP
Net revenues Total 129,908,132 103,916,575 25,991,557
Net revenues for the year were broken down as follows:
at 31 December 2021
Information required by Article 1, paragraph 125, of Law No. 124 of 4 August 2017
CATEGORIES OF ASSETS YEAR 2021 YEAR 2020 CHANGES
Sales of coffee and food products 1,566,782,961 1,437,200,327 129,582,634 Pursuant to Article 3-quater of Decree-Law No. 135/2018, for information on grants received, reference should be ACCOUNTING STATEMENTS
Sales of coffee machines and spare parts 70,706,352 64,065,767 6,640,585 made to the National Register of State Aid, Transparency section, which provides a complete list of grants disbursed > Consolidated Statement of Financial Position
Sales of raw materials and other ancillaries 12,613,971 10,075,356 2,538,615 by government entities.
Sales of advertising material 7,241,090 6,740,684 500,406
Sales of other products 2,991,799 2,109,574 882,225 In addition to the information provided in the Italian National Register of State Aid, Transparency section, the follow- > Consolidated Statement of Comprehensive Income
Sales of packaging 369,817 804,625 (434,808) ing grants towards operating expenses have been recognised, together with the accrued share of capital grants the
Total 1,660,705,990 1,520,996,333 139,709,657 benefit of which was received in previous years:
The Directors’ Single Report on Operations provides comments on the changes of this item. Operational grants
The table below provides a breakdown of sales by geographical area: DISPENSING SUBJECT AMOUNT DESCRIPTION
RECEIVED (€) FINANCIAL STATEMENTS
DESTINATION SUBSIDIARIES OTHER TOTAL --- 781,139 R&D 2021 tax receivable - Law 160/2019, as amended by Law 178/2020 Art. 1 para. 1064 INDEPENDENT AUDITORS’ REPORT
CUSTOMERS --- 313,840 R&D receivable - IT Green - Law 160/2019, as amended by Law 178/2020 Art. 1 para. 1064
EU countries 468,877,528 206,340,771 675,218,299 GSE 285,358 Photovoltaic system incentives DM 19/02/07 New Energy Account
Other European countries 59,177,140 97,396,159 156,573,299
FONDIMPRESA 71,613 Training Plan
USA 63,681,582 196,012 63,877,594
Total 1,451,950
Rest of the world 19,607,794 55,654,996 75,262,790
Total sales abroad 611,344,044 359,587,938 970,931,982
Total sales Italy 36,178,477 653,595,531 689,774,008 Financial Statements
Total 647,522,521 1,013,183,469 1,660,705,990 Capital grants at 31 December 2021
DISPENSING SUBJECT AMOUNT DESCRIPTION
RECEIVED (€)
--- 418,358 Bonus for investments in new capital goods Ateco 28 > Balance Sheet
--- 232,877 Industry Contribution 4.0 > Statement of Profit or Loss
--- 269,869 R&D receivable - (years 2017,18,19,21)
--- 172,403 Contribution to installation expenses - Caffemotive merger
--- 48,000 Super-amortisation tax credit
Total 1,141,507
Rentals refer to payments for coffee, vending and OCS machines installed on customers’ premises.
Ordinary capital gains were realised on the sale of assets no longer used in the production process.

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Costs of production
The item “royalties for the use of our trademarks” mainly refers to the licences for using the Carte Noire trademark
in France and the Lavazza trademark in France, the USA, Canada, Mexico, and South Korea.
Charge-back of costs to subsidiaries of €111,050,752 refer to promotional, transport, administrative and IT services. COMPANY OFFICERS
GROUP STRUCTURE
The item "contingent income" refers mainly to the partial utilisation of the provision for future risks and charges
(€6,051,134 million), following an update and redefinition of the risk covered, and to promotional contributions and Raw materials, ancillaries, consumables and goods LETTER TO SHAREHOLDERS
costs assessed in previous years and no longer applicable in 2021.
Purchases for the year were broken down as follows: DIRECTORS’ SINGLE REPORT
Net revenues from subsidiaries and included in value of production are as follows: ON OPERATIONS
LAVAZZA GROUP
Raw materials 666,000,469 632,387,836 33,612,633
NET REVENUES OTHER TOTAL
INCOME Goods 107,106,221 108,201,001 (1,094,780)
Direct subsidiaries Miscellaneous ancillary material

Total
7,440,598
780,547,288
7,997,882
748,586,719
(557,284)
31,960,569
at 31 December 2021
Lavazza Australia Pty Ltd 18,154,538 3,981,215 22,135,753
Lavazza Capital S.r.l. - 140,000 140,000
Lavazza Coffee (UK) Ltd 58,134,797 10,689,571 68,824,368 The increase in the cost of raw materials is mainly linked to the general increase in the price of most commodities,
Lavazza Deutschland G.m.b.H. 134,911,517 24,019,751 158,931,268 particularly green coffee and packaging, which rose significantly in the second half of 2021.
Lavazza France S.a.s. 33,572,886 1,962,268 35,535,154 ACCOUNTING STATEMENTS
Lavazza Japan GK 223,175 224,122 447,297 > Consolidated Statement of Financial Position
Lavazza Kaffee G.m.b.H. 11,130,459 2,038,926 13,169,385
Lavazza Premium Coffees Corp. 63,681,582 20,529,076 84,210,658
Costs of services > Consolidated Statement of Profit or Loss
Lavazza Professional Holding EU S.r.l. - 630,593 630,593 > Consolidated Statement of Comprehensive Income
The main costs of services were as follows:
Lavazza Professional Holding NA Inc. - 3,316,046 3,316,046 > Consolidated Statement of Cash Flows
Lavazza Spain S.L. - 8,473 8,473 YEAR 2021 YEAR 2020 CHANGES > Consolidated Statement of Changes in Equity
Lavazza Sweden AB 6,384,778 1,379,957 7,764,735
Carte Noire S.a.s. 227,710,157 31,828,777 259,538,934 Commercial and sales costs 370,299,182 317,828,196 52,470,986
Cofincaf S.p.A. 4,410 92,903 97,313 Ancillary purchasing and production costs 153,274,791 133,941,721 19,333,070
Other 56,632,387 46,385,901 10,246,486
Kicking Horse Coffee Co. Ltd - 483,744 483,744
Total 580,206,360 498,155,818 82,050,542 FINANCIAL STATEMENTS
Merrild Kaffe ApS 55,124,633 3,079,593 58,204,226
Nims S.p.A. 36,084,347 915,699 37,000,046 INDEPENDENT AUDITORS’ REPORT
Associates The increase in commercial and sales costs can be attributed primarily to the higher costs relating to advertising
Yi Bai Coffee Co. Ltd - 284,477 284,477
and promotional services, costs of trade fairs and events, as well as costs for advisory and market research, enter-
taining and hospitality and transport costs.
It bears noting that in 2020 marketing and advertising activities had declined following the restrictions related to
Lavazza Eventi s.r.l. 86,581 340,691 427,272
Covid-19. LUIGI LAVAZZA S.p.A.
Lea S.r.l. 3,139 166,771 169,910
The rise in ancillary purchasing and production costs was linked to processes outsourced to third parties, expenses
Indirect subsidiaries for technical advisory and increased rental and transport expenses, offset by a reduction in costs relating to indus- Financial Statements
at 31 December 2021
Lavazza Australia OCS Pty Ltd 849,808 525,255 1,375,063 trial utilities.
Lavazza Professional France S.a.s. 6,080 472,968 479,048 The item “other” rose mainly as a result of higher costs for maintenance, general and administrative services and
Lavazza Professional Germany G.m.b.H. 37,018 2,892,614 2,929,632 IT advisory. ACCOUNTING STATEMENTS
Lavazza Professional NA LLC - 3,004,956 3,004,956
Remuneration to Directors and Statutory Auditors for their activities during the year are indicated hereunder: > Balance Sheet
Lavazza Professional (UK) Ltd 1,042,343 2,256,039 3,298,382
Lavazza Professional (UK) Operating Services Ltd - 44,983 44,983 > Statement of Profit or Loss
TOTAL REMUNERATION PAID
Carte Noire Operations S.a.s. - 260,503 260,503 > Statement of Cash Flows
Fresh & Honest Café Ltd 380,273 53,641 433,914
Directors’ fixed remuneration 1,830,054
Total 647,522,521 115,623,612 763,146,133
Statutory Auditors’ fixed remuneration 167,440
Total 1,997,494 NOTES TO THE FINANCIAL STATEMENTS

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Use of third-party assets Provisions for risks and other provisions

The following table provides a detailed description: These refer to the following items:
COMPANY OFFICERS
YEAR 2021 YEAR 2020 CHANGES YEAR 2021 YEAR 2020 CHANGES
GROUP STRUCTURE
Property leases 8,926,960 8,888,765 38,195 Provisions for risks:
Lease of software and electronic equipment 8,355,492 7,656,193 699,299 for legal charges and litigations 4,935,000 3,324,894 1,610,106 LETTER TO SHAREHOLDERS
Vehicle leases 4,039,118 3,890,333 148,785 for future risks and charges 15,287,128 7,823,754 7,463,374
Other leases 1,888,704 1,235,634 653,070
for HR litigation - 500,000 (500,000)
Royalties for use of trademarks and patents 956,829 878,571 78,258 for machines guarantees 2,804,955 - 2,804,955
ON OPERATIONS
Total 24,167,103 22,549,496 1,617,607 Total provisions for risks 23,027,083 11,648,648 11,378,435
Other provisions:
for guarantees and endorsements - 1,189,340 (1,189,340) LAVAZZA GROUP
The most significant items concern the costs of leasing instalments for the entire real-estate complex accommodat-
for prize competition charges 221,642 50,000 171,642
ing the Company’s headquarters and the lease of software and hardware products. Total other provisions 221,642 1,239,340 (1,017,698)
at 31 December 2021
Personnel expenses Further details are given under section Provisions for Risks and Charges.
Personnel expenses include wages, corresponding contributions, employee termination indemnities paid and the ACCOUNTING STATEMENTS
total cost of temporary employment. Other operating charges > Consolidated Statement of Financial Position
The item “other personnel expenses” includes voluntary contributions for supplementary insurance and pension
schemes, one-off subsidies and gifts. The following table shows the main components: > Consolidated Statement of Profit or Loss
The average number of employees and total headcount at year-end, broken down by category, is set out in the table > Consolidated Statement of Comprehensive Income
below: YEAR 2021 YEAR 2020 CHANGES
Social charges 9,647,088 16,487,169 (6,840,081)
Categories AVERAGE 2021 HEADCOUNT AT AVERAGE 2020 HEADCOUNT AT Miscellaneous taxes and duties 3,276,228 2,546,932 729,296 > Consolidated Statement of Changes in Equity
31.12.2021 31.12.2020
Other gifts and advertising material 2,969,610 3,027,747 (58,137)
Executives 97 97 95 102 Association duties 772,630 777,566 (4,936)
Managers 118 120 106 111 Capital losses 171,841 238,844 (67,003)
Middle Managers 194 201 172 186 Other 2,293,164 4,420,990 (2,127,826)
White Collar 722 738 697 705 Total 19,130,561 27,499,248 (8,368,687)
Travelling personnel 156 154 157 158 INDEPENDENT AUDITORS’ REPORT

Blue Collars 472 471 485 479
The main item regards donations made to recognised non-profit organisations and entities, in support of social,
Total 1,759 1,781 1,712 1,741
health and cultural projects.
In addition, through a donation of €8 million work continued on supporting projects of the Giuseppe and Pericle
Lavazza non-profit foundation, which has always played an active role in promoting and developing economic, social LUIGI LAVAZZA S.p.A.
Amortisation, depreciation and write-downs and environmental sustainability projects in favour of coffee-growing communities throughout the world.
The breakdown in the sub-items has already been reported in the statement of profit or loss; see the comments on
the relevant item included in the balance sheet.
The losses indicated are of a non-financial nature and arise from the sale of fixed assets.
at 31 December 2021
> Balance Sheet


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Financial income and expense

Production costs pertaining to subsidiaries were as follows:
COSTS FOR COSTS FOR COSTS FOR COSTS FOR TOTAL

PURCHASES SERVICES OTHER FINANCIAL COMPANY OFFICERS
OPERATING EXPENSE
EXPENSES GROUP STRUCTURE
Financial income
Direct subsidiaries LETTER TO SHAREHOLDERS
Lavazza Australia Pty Ltd - 421,616 - - 421,616 The following table shows the main components:
Lavazza Coffee (UK) Ltd 812 81,056 - 71,238 153,106 DIRECTORS’ SINGLE REPORT
Lavazza Deutschland G.m.b.H. 41 - - 39,384 39,425 YEAR 2021 YEAR 2020 CHANGES ON OPERATIONS
Lavazza France S.a.s. 8,064 103,889 - 4,919 116,872
Income from investments
Lavazza Kaffee G.m.b.H. - - - 3,178 3,178
LAVAZZA GROUP
Dividends from subsidiaries 25,516,195 33,053,684 (7,537,489)
Lavazza Maroc S.a.r.l. - 157,690 - - 157,690
Total 25,516,195 33,053,684 (7,537,489)
Lavazza Netherland B.V. - 220,033 - - 220,033
Lavazza Premium Coffees Corp. 1,341 1,268,563 - 1,132 1,271,036 Consolidated Financial Statements
Lavazza Professional Holding EU S.r.l. - - 29,034 1,314 30,348
Lavazza Spain S.L. - 537,645 - 13 537,658
Dividends from subsidiaries were broken down as follows:
at 31 December 2021
Lavazza Sweden AB 5,256 - - - 5,256
Lavazza Trading (Shenzhen) Co. Ltd - 1,274,395 - - 1,274,395
CURRENCY AMOUNT COMPANY
Lavazza Japan GK - 33,594 - - 33,594
Carte Noire S.a.s. 159,884 2,151,327 - 52,253 2,363,464 EUR 11,000,000 Carte Noire S.a.s
Cofincaf S.p.A. - 653,375 - 390,099 1,043,474 EUR 2,344,721 Lavazza Coffee (UK) Ltd > Consolidated Statement of Financial Position
Merrild Kaffe ApS 1,245 240,409 - - 241,654 EUR 6,000,000 Lavazza Deutschland G.m.b.H. > Consolidated Statement of Profit or Loss
Nims S.p.A. - 800 - 3,215 4,015
EUR 3,156,019 Lavazza Premium Coffees Corp.
Kicking Horse Coffee Co. Ltd - 9,603 - - 9,603 > Consolidated Statement of Comprehensive Income
EUR 2,017,095 Merrild Kaffe ApS
EUR 998,360 Nims S.p.A. > Consolidated Statement of Cash Flows
Lavazza Professional Germany G.m.b.H. - - - 3,556 3,556
Lavazza Professional NA LLC - 843,266 - 886 844,152 Total 25,516,195 > Consolidated Statement of Changes in Equity
Lavazza Professional (UK) Ltd - 5,330,112 - 26,967 5,357,079
Lavazza Professional (UK) Operating Services Ltd - - - 18,715 18,715
Carte Noire Operations S.a.s. - 27,013,336 - 2,722 27,016,058 Other financial income was broken down as follows: NOTES TO THE CONSOLIDATED
Fresh & Honest Café Ltd 221,921 - - 221,921
Lea S.r.l. - 853,914 - - 853,914 INDEPENDENT AUDITORS’ REPORT
Interest income
Lavazza Eventi S.r.l. - 1,263,823 59,436 235 1,323,494
on non-current receivables 2,796,639 3,806,850 (1,010,211)
Lavazza Entertainment S.r.l. - - - 571 571
on bank current accounts 26,331 558,955 (532,624)
Chili S.p.A. - 1,025,324 - - 1,025,324
from subsidiaries and associates 7,899 26,971 (19,072)

Total 398,564 43,483,770 88,470 620,397 44,591,201
from companies controlled by the Parent Company 268 638 (370)
Total interest income 2,831,137 4,393,414 (1,562,277)
The item “Interest income on non-current receivables” mainly refers to the interest accrued at year-end on the
at 31 December 2021
residual loans granted to the subsidiaries Lavazza Professional Holding North America Inc., Lavazza Professional ACCOUNTING STATEMENTS
Holding Europe S.r.l., Lavazza Australia Pty Ltd and Lavazza Australia OCS Pty Ltd.
The decrease compared to the previous year refers primarily to the reduction in the amount of the principal of the > Balance Sheet
loan granted to the subsidiary Lavazza Professional Holding North America Inc. aimed at its recapitalisation. > Statement of Profit or Loss

Other interest income from subsidiaries, associates and companies controlled by the Parent Company refers to the
interest income accrued on the centralised treasury account.


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Financial expense
Value adjustments to financial assets
Interest expense and other financial expense for the year were broken down as follows:
COMPANY OFFICERS
YEAR 2021 YEAR 2020 CHANGES Value adjustments to financial assets include €2,731,408 for the write-down of the investment in Lavazza Netherlands
GROUP STRUCTURE
B.V. and corresponds to the decrease in assets partly linked to the loss for the year of the subsidiary Fresh & Honest
Interest expense
Ltd and in part to the adjustment of Euro/Rupee exchange rates at 31 December 2021 for the portion considered to LETTER TO SHAREHOLDERS
to credit institutions 5,104,885 5,506,957 (402,072)
be permanent.
to subsidiaries and associates 230,063 169,911 60,152 DIRECTORS’ SINGLE REPORT
to companies controlled by the Parent Company 235 2,091 (1,856)
The company does not hold derivatives of a speculative nature. ON OPERATIONS
Total interest expense 5,335,183 5,678,959 (343,776)
Expenses and commissions
However, where the derivatives do not meet all the conditions for applying hedge accounting treatment imposed
to subsidiaries and associates
Total expenses and commissions
390,099
390,099
508,900
508,900
(118,801)
(118,801)
by the standard OIC 32, changes in the fair value of the instruments are taken to the statement of profit or loss as LAVAZZA GROUP
adjustments reducing the value of financial assets and liabilities.
Total interest and financial expense 5,725,282 6,187,859 (462,577)
Other interest expense to subsidiaries, associates and companies controlled by the Parent Company refers to the
Write-ups and write-downs of derivatives amounting to €1,494,654 and €3,034,838, respectively, refer to the ineffec-
tive component of the derivatives contracted to hedge against foreign exchange, interest rate and commodity risks
at 31 December 2021
interest expense accrued on the centralised treasury account. and subject to hedge accounting, since they met all the conditions for the hedge accounting treatment of derivatives
as per OIC 32.
Interest expense to credit institutions mainly refers to the interest accrued at year-end on the two corporate loans, ACCOUNTING STATEMENTS
one contracted in 2018 for an initial amount of €400 million and the other entered into in 2021 for an initial amount > Consolidated Statement of Financial Position
of €300 million each.
Income taxes for the year > Consolidated Statement of Comprehensive Income
Exchange gains and losses
Realised and recognised exchange gains and losses are given in the table below: Current taxes are allocated based on reasonable forecasting of charges, due account being taken of applicable > Consolidated Statement of Changes in Equity
exemptions.
YEAR 2021 YEAR 2020 Changes The following table provides a detailed description:
Unrealised exchange gains 28,392,563 18,789,328 9,603,235

Current taxes for the year
Realised exchange gains 6,666,246 6,977,856 (311,610) FINANCIAL STATEMENTS
IRES (corporate income tax) 31,832,212
Total exchange gains 35,058,809 25,767,184 9,291,625 IRAP (regional production tax) 6,904,227 INDEPENDENT AUDITORS’ REPORT
Unrealised exchange losses 23,372,907 24,106,776 (733,869) Other current taxes 149,911
Realised exchange losses 5,489,715 8,225,260 (2,735,545) Prior years' taxes 379,963
Total exchange losses 28,862,622 32,332,036 (3,469,414) Allocation to provision for future taxes -
Net exchange gains (losses) 6,196,187 (6,564,852) 12,761,039
Deferred taxes for the year
Provision for deferred tax assets (17,338,948)
Reversals of deferred tax assets
Provision for deferred tax liabilities
10,205,443
-
Reversals of deferred tax liabilities (59,875) at 31 December 2021
Total taxes 32,072,933
The accrual to the tax provision of €1,000,000 refers to a potential risk related to the > Balance Sheet
VAT position opened by the Company in Bulgaria. > Statement of Profit or Loss


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Changes in deferred tax assets and liabilities and a breakdown of taxes are summarised in the following table, which The reconciliation between the tax charge as per financial statements and theoretical IRES and IRAP tax charge is
was prepared pursuant to Article 2427(14) of the Italian Civil Code: given in the following tables:
Nature YEAR 2020 YEAR 2021 IRES (CORPORATE INCOME TAX) TAXABLE AMOUNT THEORETICAL TAX CHARGE EFFECTIVE COMPANY OFFICERS
TAX RATE TAX RATE
BALANCE AT YEAR-START INFLOWS PROVISIONS BALANCE AT GROUP STRUCTURE
YEAR-END Gross profit 135,677,070 24.00% 32,562,497 24.00%
TAXABLE % TAX TAXABLE % TAX TAXABLE % TAX TAXABLE TAX

Higher tax charge 53,971,182 12,953,084 9.55% LETTER TO SHAREHOLDERS
AMOUNT CHARGE AMOUNT CHARGE AMOUNT CHARGE AMOUNT CHARGE of which for:
DEFERRED IRES Non-deductible taxes 2,814,743 675,538 0.50%
TAXES ON OPERATIONS
Non-deductible write-downs 2,731,408 655,538 0.48%
Allocations
Non-deductible depreciation and
to deferred 4,330,183 1,039,244 0.77%
135,320,200 24.0% 32,476,848 (36,126,448) 24.0% (8,670,348) 68,770,931 24.0% 16,505,024 167,964,683 40,311,523 amortisation
LAVAZZA GROUP
deductibility
provisions Non-deductible provisions 32,590,641 7,821,754 5.76%
Unrealised Other non-deductible costs 11,504,207 2,761,010 2.03%
exchange losses
4,973,563 24.0% 1,193,655 (4,973,563) 24.0% (1,193,655) 5,206,100 24.0% 1,249,464 5,206,100 1,249,464
Lower tax charge (56,883,392) (13,652,014) -10.06% Consolidated Financial Statements
at 31 December 2021
Statutory / tax
differences from 6,517,413 24.0% 1,564,179 (1,217,017) 24.0% (292,084) - 24.0% 5,300,396 1,272,095 of which for:
asset revaluation Costs undeducted in previous years - - 0.00%
Statutory / tax
Dividends (24,540,385) (5,889,692) -4.34%
differences 1,253,653 24.0% 300,877 (6,783) 24.0% (1,628) 197,918 24.0% 47,500 1,444,788 346,749
depreciation Other deductible costs (17,604,768) (4,225,144) -3.11%
Cash deductible Patent Box incentive - - 0.00%
- 24.0% - - 24.0% - - 24.0% - - -
costs > Consolidated Statement of Financial Position
Gains from tax exemption (PEX scheme) - - 0.00%
PREPAID IRAP
TAXES Contribution for economic growth (ACE) (14,738,239) (3,537,177) -2.61% > Consolidated Statement of Profit or Loss
Allocations to non-
Actual IRES charge 132,764,860 24.00% 31,863,566 23.48% > Consolidated Statement of Comprehensive Income
deductible/non- - 3.9% - - 3.9% - - 3.9% - - -
material provisions Energy savings (31,354)
Statutory / tax Net IRES 31,832,212
differences from 6,517,413 3.9% 254,179 (1,217,017) 3.9% (47,464) - 3.9% 5,300,396 206,715 > Consolidated Statement of Changes in Equity
asset revaluation
Statutory / tax
differences 1,253,653 3.9% 48,892 (6,783) 3.9% (265) 197,918 3.9% 7,719 1,444,788 56,347
depreciation NOTES TO THE CONSOLIDATED
Cash deductible
costs
- 3.9% - - 3.9% - - 3.9% - - -
IRAP (REGIONAL PRODUCTION TAX) TAXABLE AMOUNT THEORETICAL TAX CHARGE EFFECTIVE FINANCIAL STATEMENTS
Hedge reserve for TAX RATE TAX RATE
expected cash flows
5,615,201 (5,615,201) 438,562 438,562 INDEPENDENT AUDITORS’ REPORT
Value of production (A-B) 312,836,428 3.94% 12,332,372 3.94%
TOTAL DEFERRED
41,453,832 (15,820,644) 18,248,269 43,881,455 Higher tax charge 11,328,061 446,566 0.14%
TAX ASSETS
of which for:
DEFERRED IRES
TAX LIABILITIES Costs for outsourced personnel 1,929,691 76,071 0.02%
Allocations
to deferred
Non-deductible depreciation and amortisation 239,306 9,434 0.00%
1,961,493 24.0% 470,758 1,961,493 470,758 Other non-deductible costs 9,159,064 361,061 0.12%
deductibility
Lower tax charge (149,024,324) (5,874,710) -1.88%
provisions
of which for:
at 31 December 2021
Unrealised
- 24.0% - - 24.0% - - 24.0% - - -
exchange gains Costs undeducted in previous years (6,783) (267) 0.00%
Statutory / tax Use of deductible provisions (14,122,676) (556,732) -0.18%
differences from 1,653,616 24.0% 395,868 (214,607) 24.0% (51,506) 1,952,723 24.0% 468,654 3,391,732 814,016
Deductible contributions and costs for personnel (134,894,865) (5,317,711) -1.70% ACCOUNTING STATEMENTS
M&As
DEFERRED IRAP
Patent Box incentive - - 0.00% > Balance Sheet
TAXES Actual IRAP charge 175,140,165 3.94% 6,904,227 2.21%
Statutory / tax
differences from 1,653,616 3.9% 64,491 (214,607) 3.9% (8,370) 1,952,723 3.9% 76,156 3,391,732 132,278 > Statement of Cash Flows
M&As
Hedge reserve for
3,520,948 (3,520,948) 16,265,002 16,265,002
expected cash flows
TOTAL DEFERRED
3,981,307 (3,580,823) 17,280,569 17,682,054 NOTES TO THE FINANCIAL STATEMENTS
TAXES
The reversal of temporary differences in future years has been assessed on the basis of the best available estimates, INDEPENDENT AUDITORS’ REPORT
in accordance with the prudence principle.

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Commitments, guarantees and Supplementary information and

contingent liabilities statements COMPANY OFFICERS
GROUP STRUCTURE
THIRD-PARTY GUARANTEES IN OUR FAVOUR € 9,106,326

Information on payables due after 5 years and/or secured ON OPERATIONS
This item consists of guarantees given in our favour by banks: €1,500,000 in the interest of the Ministry of Economic by collateral on company assets
Development for prize contests; €4,964,254 for the application for VAT reimbursement to a Group company; LAVAZZA GROUP
JPY 100,000,000 in the interest of Tokyo Customs for import duties and taxes; and €81,000 in the interest of the
A.E.M. Energia (Milan) and Edison Energia S.p.A. (Pozzilli) for gas supplies; €204,093 to the Region of Piedmont for (pursuant to article 2427, paragraph 6, of the Italian Civil Code) Consolidated Financial Statements
clearance work and safety assessment associated with the new Headquarters; €231,930 to the Municipality of Turin
for the equipped flowerbeds at the new headquarters and groundwater remediation works; €16,702 to Consorzio There are no payables secured by collateral on company assets.
at 31 December 2021
Nucleo Sviluppo Industriale Isernia for drinking water supply; €577,020 to Customs; €690,338 for property leases;
Information on capitalised financial expense

and €74,000 to the Italian General Commissioner for Italy’s participation to the EXPO 2020 DUBAI and referring to
the sponsorship of the Italian Pavilion. ACCOUNTING STATEMENTS
(pursuant to article 2427, paragraph 8, of the Italian Civil Code) > Consolidated Statement of Profit or Loss

GUARANTEES IN FAVOUR OF SUBSIDIARIES €25,543,947 There is no capitalised financial expense to be reported.
The account consists of €1,026,072 in guarantees in favour of Cofincaf S.p.A. to finance contracts with Ho.Re.Ca.
customers; €24,075,076 for financing customers’ purchases of vending machines for beverages and €442,799 for > Consolidated Statement of Changes in Equity
Consideration owed to the Independent Auditors

loans to employees.

(pursuant to Article 2427, paragraph 16-bis, of the Italian Civil Code)
SUBSIDIARY FOR COLLECTION OF CREDITS €17,382,923
This includes credits outstanding at year-end managed for collection by the subsidiary Cofincaf S.p.A. The information required by the above-mentioned regulation is included in the Notes to the Consolidated Financial
Statements of the Lavazza Group at 31 December 2021 prepared by the Company.

LEASING COMPANY FOR UPCOMING LEASE PAYMENTS €71,575,467 Related party transactions
Upcoming lease payments to be made to the leasing company as per finance lease agreement entered into for the Financial Statements
construction of the Company’s headquarters.
(pursuant to Article 2427, paragraph 1, No. 22-bis, of the Italian Civil Code)
at 31 December 2021
With reference to the provisions of applicable legislation, in the reporting year the Company carried out related
party transactions that were concluded at arm’s length conditions. > Balance Sheet

Off-balance sheet arrangements
(pursuant to Article 2427, paragraph 1, No. 22-ter, of the Italian Civil Code)
There were no arrangements the effects of which are not presented in the balance sheet and knowledge of which INDEPENDENT AUDITORS’ REPORT
would be helpful to assessing the Company's capital and financial position.

216 217 PRINT PDF
Post balance sheet events Allocation of the profit for the year
COMPANY OFFICERS
(pursuant to Article 2427, paragraph 1, No. 22-quater, of the Italian Civil Code) (pursuant to Article 2427, paragraph 1, No. 22-septies, of the Italian Civil Code)
GROUP STRUCTURE
The Group has distributors and customers in emerging markets that may also be subject to geopolitical risks such Reminding the Shareholders that the legal reserve has reached the limit set forth by Article 2430 of the Italian Civil LETTER TO SHAREHOLDERS
as, for example, Russia and Ukraine. At the reporting date, the devastating effects in both countries produced by Code, we recommend that the profit for the year, which amounted to €103,604,137.40 be allocated as follows: to
the Russian invasion of Ukraine are evident. Most production and commercial activities are suspended. At the same the 22,500,002 outstanding shares a dividend of €1.90 per share, totalling €42,750,003.80 overall; to the restricted DIRECTORS’ SINGLE REPORT
time, Russia has been hit by heavy sanctions issued by the main European and Nato countries as well as the flight of reserve for exchange gains an amount of €5,019,656.00; and the remaining €55,834,477.60 as profit carried forward. ON OPERATIONS
foreign private investors which are weakening its economy. There are no significant impacts on the Group’s business
even though all activities in Russia were suspended at the reporting date, combined with the inability to supply the
Ukrainian market. LAVAZZA GROUP
The 2021 results are not only a historic milestone for the Group but also the starting point from which to face a year Turin, 28 March 2022 Consolidated Financial Statements
that promises to be extremely complex and challenging, due to the rise in all the raw materials we deal with —
green coffee primarily but also packaging, energy and logistics. The strong price volatility marking this period
at 31 December 2021
makes it particularly difficult to provide completely reliable forecasting elements.
Finally, with regard to the Covid-19 pandemic situation, 83% of the Italian population has completed the primary ACCOUNTING STATEMENTS
vaccination cycle and so it is hoped that the arrival of the summer season will see a generalised recovery in con- > Consolidated Statement of Financial Position
sumption, with particular regard to the Away from Home sector.

Company Preparing the Consolidated Financial Statements > Consolidated Statement of Changes in Equity
(pursuant to Article 2427, paragraph 1, No. 22-quinquies/sexies, of the Italian Civil Code) NOTES TO THE CONSOLIDATED
FINLAV S.P.A.
Registered Offices: Via Bologna 32 - 10152 TURIN INDEPENDENT AUDITORS’ REPORT
Fully paid-up share capital: €167,500,000
Tax code and Turin Company Register No. 03028560153
Turin Economic and Administrative Index (REA): 910824

at 31 December 2021
> Balance Sheet


218 219 PRINT PDF
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet
Statutory Auditors’ NOTES TO THE FINANCIAL STATEMENTS

Report INDEPENDENT AUDITORS’ REPORT

220 221 PRINT PDF
JOINT STOCK COMPANY LUIGI LAVAZZA S.p.A
Registered Offices: Turin - via Bologna 32 Shareholders,
Fully paid up share capital €25,000,000.= COMPANY OFFICERS
Tax code and Turin Company Register No. 00470550013 This Report has been approved collegially for filing at the Company’s offices in view of the Shareholders’
GROUP STRUCTURE
Meeting called to approve the Financial Statements commented herein. LETTER TO SHAREHOLDERS
The administrative body has thus provided access to the following documents approved on 28 March DIRECTORS’ SINGLE REPORT
ON OPERATIONS
2022 concerning the year ended 31 December 2021:
- the draft Financial Statements, including the Notes and the Statement of Cash Flow; and LAVAZZA GROUP
- the Report on Operations. Consolidated Financial Statements
Knowledge of the Company, assessment of risks and report on professional assignments at 31 December 2021
Regarding the activity carried out by the Board of Auditors in 2021, we point out that meetings were held
ON THE FINANCIAL STATEMENTS ACCOUNTING STATEMENTS
remotely in order to comply with the precautionary rules resulting from the spread of the Covid-19
FOR THE YEAR ENDED 31 DECEMBER 2021 > Consolidated Statement of Financial Position
pandemic. > Consolidated Statement of Profit or Loss

Given the long-standing knowledge that the Board of Statutory Auditors represents it possesses about the
Company and: > Consolidated Statement of Changes in Equity
I) the type of business conducted;

II) the organisational and accounting structure;
and in light of the Company’s size and concerns, it bears reiterating that the “planning” phase of the INDEPENDENT AUDITORS’ REPORT
supervisory activity — during which the inherent risks and critical issues relating to the two above
parameters are verified — was implemented by verifying that the information obtained over time was
still current.
It was therefore possible to confirm that: at 31 December 2021
- the Company’s core business did not change during the reporting year and is consistent with its ACCOUNTING STATEMENTS
> Balance Sheet
Articles of Association;
- the human resources constituting the “workforce” remained virtually unchanged; > Statement of Cash Flows

2
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- it may be observed that in 2021 the Company operated on comparable terms to the previous year, and For the entire year, it was determined that:
COMPANY OFFICERS
thus that our controls were performed on this basis, having verified that the values and results are - the level of their technical preparation remained adequate to the type of ordinary corporate events to
GROUP STRUCTURE
essentially comparable with those from the previous year. be recorded and they possessed sufficient knowledge of the Company’s concerns;
This Report thus summarises the activity relating to the information provided for in Article 2429, - the external consultants and professionals engaged to provide assistance with tax, corporate and labour DIRECTORS’ SINGLE REPORT
paragraph 2, of the Italian Civil Code, and namely: ON OPERATIONS
law matters did not change, and they thus possessed long-standing knowledge of the business
- the results for the year; conducted and ordinary and extraordinary operating issues that affected the results presented in the
LAVAZZA GROUP
- the activity performed in fulfilment of statutory duties; Financial Statements.
- remarks and proposals concerning the Financial Statements, with particular regard to any use by the The information required by Article 2381, paragraph 5, of the Italian Civil Code was provided by the at 31 December 2021
governing body of derogations pursuant to Article 2423, paragraph 5 (formerly paragraph 4), of the Chief Executive Officer. In conclusion, to the extent it was possible to determine in the course of the
activity performed during the year, the Board of Statutory Auditors may state that: ACCOUNTING STATEMENTS
Italian Civil Code.
The activities performed by the Board of Statutory Auditors concerned the entire financial year. The - the decisions made by the shareholders and the administrative body were compliant with the law and
meetings set out in Article 2404 of the Italian Civil Code were regularly held and specific minutes for the Articles of Association and were not in potential conflict of interest nor were they, imprudent or > Consolidated Statement of Comprehensive Income

such meetings were drafted and duly signed in unanimous approval. such as to jeopardise the Company’s capital integrity;
Activities performed - sufficient information was obtained about the general operating performance and business outlook,
During its periodic controls, the Board of Statutory Auditors obtained information about the course of and about the most significant transactions undertaken by the Company and its investees in terms of NOTES TO THE CONSOLIDATED
the business of the Company and its subsidiaries, with a particular focus on problems of a contingent size or characteristics;
and/or extraordinary nature, so as to identify their impact on the Company’s operating result for the year - the transactions undertaken were also compliant with the law and the Articles of Association, in line
and financial structure, in addition to any risks, such as those due to losses on receivables, which are with the principles of sound management and not in potential conflict with the resolutions passed by
subject to regular monitoring. the Shareholders’ Meeting, or such as to jeopardise the Company’s capital integrity; LUIGI LAVAZZA S.p.A.
The Board of Statutory Auditors periodically assessed the adequacy of the Company’s organisational - as regards the ongoing crisis linked to the Covid-19 epidemic, it acknowledged that the Company has Financial Statements
put in place the necessary measures to safeguard the health of its employees and, in any case, all those
at 31 December 2021
and functional structure and any changes with respect to minimum needs in light of operating
performance. measures provided for by the regulations as they were issued, and that the Company’s efficient
> Balance Sheet
operation has never been compromised; > Statement of Profit or Loss
Relations with the persons operating within the above structure — directors, employees and consultants
- it acquired knowledge of and oversaw, insofar as within its remit, the adequacy and functioning of the
— are inspired by mutual collaboration in accordance with the roles assigned to each of them.
organisational structure and the internal control system, as well as of the administrative-accounting
system, also with reference to its correct operation during the emergency period,
4 SUSTAINABLE SINGLE PAGE

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as well as the reliability of said system in representing the operating events correctly. To this end, it any identification of material misstatements, adverse opinions, disclaimers of opinion or requests for
COMPANY OFFICERS
obtained information from the heads of functions, examined company documents and analysed the additional information, and the opinion issued is therefore positive.
GROUP STRUCTURE
activities carried out by the independent auditors and, in this regard, it has no particular observations The draft Financial Statements have thus been examined and the following additional information is
to report; provided in this regard:
- it obtained information by the supervisory body and no critical issues emerged with regard to the - since we are not responsible for detailed control of the Financial Statements on the merits, we focused ON OPERATIONS
proper implementation of the organisational model that would have required mention in this Report; on the structure of the Financial Statements and their general compliance with the law in terms of
preparation and structure, and we do not have any specific remarks to submit to you on this subject;
LAVAZZA GROUP
- it did not have to intervene due to failure to act by the administrative body pursuant to Article 2406
- we verified that the Financial Statements are consistent with the facts and information of which we Consolidated Financial Statements
of the Italian Civil Code;
became aware in the course of performing the duties typically assigned to boards of statutory auditors at 31 December 2021
- no complaints were received pursuant to Article 2408 of the Italian Civil Code;
and we do not have further remarks on this subject;
- no complaints were filed pursuant to Article 2409, paragraph 7, of the Italian Civil Code; - to the best of our knowledge, in preparing the Financial Statements the Directors did not apply ACCOUNTING STATEMENTS
- during the year, the Board of Statutory Auditors issued the opinions required by law; derogations pursuant to Article 2423, paragraph 5 (formerly paragraph 4), of the Italian Civil Code;
- in carrying out the supervisory activity, as described above, no other material facts were brought to - the Financial Statements have been prepared in accordance with the provisions of Articles 2423 et
seqq. of the Italian Civil Code, interpreted according to the accounting standards issued by the Italian > Consolidated Statement of Cash Flows
light that would have required mention in this Report.
Accounting Standard-Setter (OIC). Accordingly, the layouts adopted are consistent with those > Consolidated Statement of Changes in Equity
Remarks and proposals concerning the Financial Statements and their approval
envisaged in the Italian Civil Code for the Balance Sheet (Article 2424) and the Statement of Profit
The draft Financial Statements for the year ended 31 December 2021 have been approved by the or Loss (Article 2425), and with the basis of preparation, in light of the application of Legislative NOTES TO THE CONSOLIDATED
administrative body and comprise the Balance Sheet, the Statement of Profit or Loss, the Statement of Decree No. 139/2015, envisaged in Article 2423-bis of the Italian Civil Code;
Cash Flow and the Notes. - as indicated in the Notes to the Financial Statements, which include the tables prepared in accordance
In addition: with specific provisions of law or the OIC’s requirements, items of the Financial Statements have been
- the administrative body has also prepared the Report on Operations pursuant to Article 2428 of the measured in accordance with Article 2426 of the Italian Civil Code; LUIGI LAVAZZA S.p.A.
Italian Civil Code; - the Notes include the content specified in Articles 2427 and 2427-bis of the Italian Civil Code, which Financial Statements
- those documents were delivered to the Board of Statutory Auditors in time to be filed at the complements the tables of the Balance Sheet and Statement of Profit or Loss with the measurement at 31 December 2021
criteria adopted and the other information required by provisions of law, in addition to providing the ACCOUNTING STATEMENTS
Company’s registered office, accompanied by this Report;
> Balance Sheet
- statutory auditing has been entrusted to the auditing firm EY S.p.A., which has drawn up its report other information deemed necessary to more thorough understanding of the Financial Statements; > Statement of Profit or Loss
pursuant to Article 14 of Legislative Decree No. 39 of 27 January 2010. This Report does not contain - the Statement of Cash Flow was prepared in accordance with Article 2425-ter of the Italian Civil Code; > Statement of Cash Flows

5 6 SUSTAINABLE SINGLE PAGE

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- in addition, pursuant to Article 2426, paragraph 1, points 5 and 6, of the Italian Civil Code, the Board to your approval of the draft Financial Statements for the year ended 31 December 2021, as drafted, as well
COMPANY OFFICERS
of Statutory Auditors also granted its consent to the recognition of amounts allocated to the item as of the allocation of the net profit for the year, as submitted to you by the administrative body.
GROUP STRUCTURE
development costs and goodwill, whereas no start-up and expansion costs were recognised during the Upon approval of this Annual Report, the three-year mandate of the Board of Statutory Auditors in office
year; will expire. Thanking you for the trust you placed in us, we hereby invite you to resolve on the matter.
- the Single Report on Operations drafted by the Directors identifies the main events that characterised ON OPERATIONS
operations and the result for the year, in addition to providing an analysis of technical investments,
LAVAZZA GROUP
financing activity and the other information required by Article 2428 of the Italian Civil Code, including Turin, 13 April 2022
information about transactions with parent companies and related parties, specifying the amount and THE BOARD OF STATUTORY AUDITORS at 31 December 2021
nature of the relationship, including the specification that they were concluded at arm's length (Gianluca FERRERO)
conditions; (Angelo GILARDI) ACCOUNTING STATEMENTS

- the geopolitical tensions between Russia and Ukraine and the consequent outbreak of the armed conflict (Bernardo BERTOLDI)
in February 2022 have generated strong instability, the impact of which on the global political and > Consolidated Statement of Comprehensive Income

economic scenario is difficult to estimate. The Board of Directors illustrated the Company’s framework
of reference in the Report on Operations;
- we acknowledge that the Company prepares its Consolidated Financial Statements in compliance with NOTES TO THE CONSOLIDATED
the IAS/IFRS. In this regard, the independent auditors EY S.p.A. confirmed in their report that the
consolidated financial statements were correctly drawn up and the Report on Operations was consistent
with the said financial statements, in addition to being compliant with the law, therefore expressing a
clean, positive opinion; LUIGI LAVAZZA S.p.A.

- the Board of Statutory Auditors has no remarks to make with regard to the administrative body’s Financial Statements
proposed allocation of the net profit for the year presented at the end of the Notes.
at 31 December 2021
Result for the year
> Balance Sheet
The net result reported by the administrative body for the year ended 31 December 2021 is positive at > Statement of Profit or Loss

€103,604,137.
Conclusions
On the basis of the foregoing, as ascertained by the Board of Statutory Auditors’ and in the course of the STATUTORY AUDITORS’ REPORT
periodic controls performed, it is our opinion that there is no impediment INDEPENDENT AUDITORS’ REPORT
7 This report has been translated into the English language solely for the convenience of international readers. 8 SUSTAINABLE SINGLE PAGE
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COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet
Independent > Statement of Profit or Loss
Auditors’ Report NOTES TO THE FINANCIAL STATEMENTS


230 231 PRINT PDF
COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet


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COMPANY OFFICERS
GROUP STRUCTURE
ON OPERATIONS
LAVAZZA GROUP
at 31 December 2021


at 31 December 2021
> Balance Sheet


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COMPANY OFFICERS
GROUP STRUCTURE
Registered and administrative offices: DIRECTORS’ SINGLE REPORT

Via Bologna 32 – 10152 Turin – Italy ON OPERATIONS
Subscribed and fully paid-up capital: €25,000,000
Tax code and registration No. at the Turin Register of Companies: 00470550013
LAVAZZA GROUP
PREPARED BY
at 31 December 2021
Financial Reporting & Accounting Department

EDITORIAL SUPPORT > Consolidated Statement of Profit or Loss

Corporate Communication Department
GRAPHIC CONCEPT AND DESIGN

SGI Società Generale dell’Immagine S.r.l. - Turin
TRANSLATED BY
Koinè - Trieste
at 31 December 2021
> Balance Sheet


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ANNUAL REPORT

Company Officers Group Structure

BOARD OF STATUTORY AUDITORS SERVICES Ltd.

> Statement of Cash Flows

50.01% INDEPENDENT AUDITORS’ REPORT

The Chairman of the Board of Directors

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> Consolidated Statement of Profit or Loss

> Consolidated Statement of Comprehensive Income

> Consolidated Statement of Cash Flows

> Consolidated Statement of Changes in Equity

NOTES TO THE CONSOLIDATED

LUIGI LAVAZZA S.p.A.

Report on > Balance Sheet

> Statement of Profit or Loss

NOTES TO THE FINANCIAL STATEMENTS

SUSTAINABLE SINGLE PAGE

Group highlights Businesses and brands

Group’s result for the year Businesses GROUP STRUCTURE

Between innovation and sustainability

12 collaborators and barley beverages, tea, infusions and granitas.

Carte Noire Merrild

> Statement of Profit or Loss

> Statement of Cash Flows

NOTES TO THE FINANCIAL STATEMENTS

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General performance and market scenario

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FOOD SERVICE (HO.RE.CA.) DIRECTORS’ SINGLE REPORT

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Industrial investments LUIGI LAVAZZA S.p.A.

> Statement of Profit or Loss

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Financial Performance of Consolidated operating, capital and

LUIGI LAVAZZA S.p.A.

> Statement of Profit or Loss

> Statement of Cash Flows

NOTES TO THE FINANCIAL STATEMENTS

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Revenues for the first time above

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Capital and financial situation

TOTAL FINANCING SOURCES 2,251 2,249 2 LUIGI LAVAZZA S.p.A.

> Statement of Profit or Loss

> Statement of Cash Flows

NOTES TO THE FINANCIAL STATEMENTS

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Net financial position at year-start 102 82

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Risk Management Interest rate risk

Exchange rate risk

Commodity price risk

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Integrating sustainability in its operations

> Consolidated Statement of Comprehensive Income

> Consolidated Statement of Cash Flows

> Consolidated Statement of Changes in Equity

> Statement of Profit or Loss

> Statement of Cash Flows