gaming SOCIAL REPORT

Transcription

1 gaming SOCIAL REPORT

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4 gaming

5 2014 SOCIAL REPORT

6 Table of CONTENTS

7 First part THE REPORT CONTINUES: DISCOVERING HBG GAMING Chairman s Letter THE HBG GAMING FACT SHEET Our history Our identity The organization s value The HBG Gaming Group Governance Ethics and responsibility Quality and Certifications system THE GAMING MARKET The HBG Gaming market Bingo New Slot and Videolottery Remote gaming Betting Second part DIALOGUE WITH STAKEHOLDERS OUR TEAM Attention to our People Group building and individual growth OUR PARTNERS Relationship with providers COMMUNITY AND RESPONSIBLE GAMING Relationship with consumers Legal and Responsible GamIng Community Initiatives Cooperation with Associations Environment Added Value creation and distribution How to read this report 97

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9 CHAIRMAN S LETTER is a great pleasure for me to write this letter introducing the second edition of our Social Report. IT Social responsibility is a value in which HBG Gaming believes and this document intends to provide an account and reaffirm our commitment in this regards: staying in a transparent and responsible market, making legality and excellence our guiding light. This document gives account of what we have done and what we have planned for our future commitments. Our Mission Creating a safe, legal and responsible entertainment with a positive impact on the community is a proof of HBG Gaming willingness and determination and also a promise for the future, to keep working respecting our values and promoting initiatives for the good of our stakeholders and the whole Community. The recipients of this Social Report are, first of all, our people, the ones with whom we share our passion for excellence and our determination to achieve our goals. The hard work of employees and collaborators is what makes our company a great team making professionalism, personal growth and passion their own characteristic making HBG Gaming an excellent and competitive company. The Company managed to build a trustful and fair relationship with all the Stakeholders, those who have intense and important relationships with HBG Gaming. In particular, our relationship with customers is focused on values such as transparency, respect and competence. Finally, we try to go beyond the mere dialogue with the Community in order to promote initiatives having favourable effects on the area. Siamo consapevoli di operare in un settore delicato che richiede un estrema attenzione a tutela dei We are aware of the fact that we work in a delicate sector requiring extreme attention for the protection of customers. This is why we have launched a Legal and Responsible Gaming Programme in order to promote a safe and balanced entertainment. Our aim is to develop this programme further. I would like to thank all the women and men of the HBG Gaming Group who, with their professional and personal commitment, allowed us to achieve important results in terms of service and quality. Antonio Porsia

10 First part THE REPORT CONTINUES: DISCOVERING HBG GAMING

11 HBG Gaming decided to talk about the activities performed each year, to report on the results achieved and the efforts in terms of social responsibility. This will stems from the awareness of the clear duties that a company has towards all the players involved and that great results can be achieved only if we work as a team in which each individual has his or her own skills, passion and enthusiasm for the achievement of common goals. The company is an orchestra in which every individual uses his or her own talent, knowledge and skills to achieve a great common goal in compliance with the rules, the timing and the score, expressing the highest level of the potentials that are present within the group itself. Being part of a close-knit and harmonious group means making one s own skills available to encourage a synergistic development of a functional environment for the achievement of individual goals, in the light of the common objective. In order to achieve this goal it is necessary to master the instruments and the score, but it is also fundamental to work in harmony and know the rules, the organization, the environment, the specific role within the group very well, having a clear individual and collective vision. In this first part of the Social Report we aim at telling who we are, our history, our values, structure and rules we have set to achieve absolutely excellent results with our collaborators professionalism and commitment.

12 THE HBG GAMING FACT SHEET 010 HBG Gaming is one of the biggest Italian company in the Safe and Legal Gaming sector regulated by the Italian Customs and Monopolies Agency.. It is on the national territory with 16 of the best and most comfortable Bingo rooms, with more than 6,000 seats, representing a socializing network offering safe and responsible gaming experiences. Moreover: New Slots, Videolottery, Bets and Online Games allowing the broadest entertainment available on the market. These are HBG Gaming figures, a sound and growing company interpreting the taste of healthy and safe gaming, offering a broad range of entertainment on the whole Italian territory, contributing, with its activities, to around 400 million Euro tax revenue. It is a company believing in teamwork and willing to tell its story with transparency, highlighting all of the nuances and features of an enthusiastic work which is oriented towards competence and professionalism.

13 BINGO ROOMS New Slot 414 TAX REVENUE* VIDEOLOTTERY 640 EMPLOYEES *Millions of Euro in 2014

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15 OUR HISTORY 013 HBG Gaming is one of the biggest Italian players in the Gaming sector regulated by the Government Monopolies, providing transparent, responsible and safe entertainment occasions. The Company history, from its inception, has been marked by a social responsibility commitment towards Customers and Consumers, expressed in the continuous attention to their trust and satisfaction, in the sustainability of deployed actions and in compliance with the rules. In 2000, for the first time HBG Gaming entered the gaming market and, in a short time, became a protagonist of the Bingo rooms management. In 2003, the Company had a great increase of its market share in this sector, thanks to the purchase of Bingo Plus SpA from Lottomatica. In 2004, HBG Gaming continued its path to success achieving the permits for the activation and the management of the New Slot IT network. THE WOMEN AND MEN WORKING FOR IT ARE AT THE CORE In 2009 the Company launched the SmartGames.it website, through which distributing new remote gaming games, such as Skill Games, Poker and Online Casino games. Still in 2009, HBG Gaming acquired the rights for the installation and distribution of 4,798 Videolottery machines in the Italian market. In 2013 it achieved 42 rights for the opening of shops for the collection of sports, horse-racing and virtual bets. Today, HBG Gaming is a young and successful company, developed in terms of size and service quality, putting the women and men working for it at the core, investing on the personal and professional qualities of employees and collaborators, knowing that their growth and development are the key to create Value in the Company

16 OUR IDENTITY 014 VISION, MISSION AND VALUES In these years, HBG Gaming has shaped its own identity, focusing on the value of People, developing a path to excellency looking at sustainability and compliance with rules. The company growth and the market evolution required a deep thought which was needed to face the changes and to give a better response to an increasingly broader group of partners. The resulting Vision, Mission and Values tell who we are and, at the same time, represent to guide to our behaviours. Vision Becoming a leader in the quality of service and entertainment through the development of talent and professionalism. A clear Vision, chased with determination; aimed at offering gaming products enabling the best possible entertainment; aimed at service quality and excellency; willing to make the most of the talent in its team. We want to provide a quality service translating into a pleasant, safe, legal and responsible entertainment. We can do it with the talent and the professionalism in our Team. Our Group vision is the one of a set of professionals interacting among them with a mutual positive influence, where also the solo voices become greater by using their own talent together with the capacity of the whole company. Mission To create a safe, legal and responsible entertainment with a positive impact on the community. This is HBG Gaming Mission, a company able to provide a positive contribution for the Community in which it works, generating employment, contributing to tax revenue, complying with legal gaming and starting initiatives for the community.

17 015 GUIDING VALUES First of all, the Values in which HBG Gaming believes are shared: there is an active participation in the Corporate Mission by all the People who are part of it. The first chosen value is the Team, and this is not by chance. HBG Gaming is a company made of different groups of People who are coordinated among them and who carry out the different company functions in synergy and cooperation. Team, Transparency and Respect are the values which HBG Gaming puts into Practice every day. Team The company strongly believes that participation, sharing and teamwork make people grow: a team is bigger than the sum of its components. Innovation and professional and personal diversity are promoted, guaranteeing the maximum result from teamwork. Our strength is given by the people who work for HBG Gaming: a team, not a simple group, sharing goals and strategies, standing out for professionalism and capacity to cooperate, allowing us to achieve excellent results in these years. Transparency In the company, people act in consistency with and respecting corporate values, ensuring visibility and feedbacks on their own actions and information. There is a clear and transparent communication, both internally and externally, favouring a free and respectful exchange of information. All HBG Gaming activities are oriented towards fairness and transparency: our entertainment offer is transparent; our behaviour with employees, as well as our relationships with Customers and Consumers are transparent. Being aware of our role in the Social Responsibility map allowed us to move in the most right and virtuous direction with a continuous dialogue with the reference stakeholders. Respect HBG Gaming works hard to win the respect of its customers, business partners and colleagues through behaviours inspired by sense of responsibility and honesty. The company works in compliance with the law, internal and external rules, promoting and increasing a positive impact on the community. Time after time, HBG Gaming has built a trustful and fair relationship with customers, business partners and colleagues with responsible behaviours. The compliance with the law and rules are key conditions in our job; we work to constantly guarantee the esteem of out reference Community, generating resources for the social and cultural development of the Country. Action HBG Gaming acts pro actively, swiftly and quickly, guaranteeing effective and efficient solution for (internal and external) customers and business partners. The whole team is always present and ready for action for the internal and external growth of the company with courage, passion and energy.

18 THE ORGANIZATION S VALUE 016 THE HBG GAMING GROUP HBG Gaming is a great Group made of: HBG Gaming Srl: the Holding Company, managing and coordinating the Companies which are part of the group. Its legal office is in Rome, via Cesare Pascarella n. 7. HBG Connex SpA: licensed company of the IT network of Entertainment Devices (ADI), which are New Slots (also AWP) and Videolottery (VLT). The 2014 turnover amounts to million Euro. Bingo Plus SpA, HBG Arcades SpA e Latina Bingo Srl: licensed for the Bingo management. The 2014 Bingo Plus Spa turnover amounted to 16.6 million Euro. The 2014 HBG Arcades Spa turnover amounted to 16.5 million Euro. The 2014 Latina Bingo Srl turnover amounted to 1.7 million Euro. HOLDING HBG GAMING SRL The three companies are expected to merge in HBG Online Gaming Srl: icensed for the collection of sports, horse-racing and virtual bets in gaming shops and for the collection of remote gaming. The 2014 turnover amounted to 1.6 million Euro.. HBG Immobiliare Srl: owning two real estate properties for the management of Bingo rooms. 100% 100% 100% 100% 100% HBG CONNEX SPA BINGO PLUS SPA HBG ARCADES SPA LATINA BINGO SRL HBG IMMOBILIARE SRL 100% HBG ONLINE GAMING SRL

19 017 The HBG Gaming organization model is based on three Business Units: AWP&VLT, Bingo and Online Gaming and Bets, as well as 5 Departments ensuring the correct management and working for the correct implementation of the corporate Mission. AWP&VLT Business Unit Has the duty to develop the NewSlots network (more than 30,000 NewSlots uniformly distributed all over the Italian territory in more than 11,000 venues) and the 4,798 Videolottery networks for which it acquired the distribution rights, choosing Novomatic, Spielo and Inspired as strategic partners. Bingo & Casino Business Unit Manages the 16 rooms on the Italian territory with more than 6,000 seats and 780 among slot machines and videolotteries. Works on all organization, financial, marketing and communication aspects. On Line Gaming and Bets Business Unit Has the duty to develop the 52 gaming shops network (as of 2015) and manages remote gaming through the website working with strategic partners and a technologically advanced and reliable gaming platform guaranteeing high security standards in full compliance with the law. IT Systems and Technologies Department Accounting, Finance and Control Department Legal and Corporate Affairs Departmenti Compliance Department Organization and Human Resources Department THE GOVERNANCE In HBG Gaming, Corporate governance aims at guaranteeing the compliance with transparency, responsibility and integrity values and to fulfil the corporate mission The HBG Gaming Corporate Governance system adopts a traditional governance and control model, with a Board of Directors and a Board of Statutory Auditors, as well as, obviously, the Shareholders meeting. For every company, Accounting Auditing is carried out by Deloitte & Touche, a company registered in the special Consob list, as envisaged by current regulations. The Supervisory Body was set-up as envisaged by Legislative Decree 231 of All the HBG Gaming Group companies adopted a Management and Control Organization Model in order to prevent and tackle the commission of crimes envisaged by Decree 231, through a structured system of procedures and a continuous monitoring on the implementation of said system.

20 SHAREHOLDERS MEETING 018 BOARD OF DIRECTORS Mr. Salvatore Candido Board Member Mr. Antonio Porsia Chairman Mr. Giuseppe Calzolaio Board Member BOARD OF STATUTORY AUDITORS AUDITING COMPANY SUPERVISORY BODY Mr. Giovanni Luca Cezza Chairman Mr. Paolo Omodeo Salé Standing Statutory Auditor Mr. Marco Tani Standing S. Auditor DELOITTE & TOUCHE SpA Att. Luigi Fischetti Chairman Att. Marco Moretti Ms. Barbara Colucci Mr. Giuseppe Calzolaio General Manager

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22 Giuseppe Calzolaio ad interim B.U. AWP&VLT Has the duty to develop the NewSlots network (more than 30,000 NewSlots uniformly distributed all over the Italian territory in more than 11,000 venues) and the 4,798 Videolottery networks for which it acquired the distribution rights, choosing Novomatic, Spielo and Inspired as strategic partners. Cosma Damiano De Rosa B.U. BINGO&CASINÒ Manages the 16 rooms on the Italian territory with more than 6,000 seats and 780 among Slot Machines and Videolotteries. Works on all organization, financial, marketing and communication aspects. Carlo Labate IT SYSTEMS AND TECHNOLOGIES DEPARTMENT Giovanni Tiscione ACCOUNTING, FINANCE AND CONTROL DEPARTMENT

23 Giuseppe Calzolaio GENERAL MANAGER Michele Graiff B.U. GIOCHI ON LINE E SCOMMESSE Has the duty to develop the 52 gaming shops network and manages remote gaming through the website working with strategic partners and a technologically advanced and reliable gaming platform guaranteeing high security standards in full compliance with the law.. Claudio Altobelli Barbara Colucci Giuseppe Calzolaio ad interim LEGAL AND CORPORATE AFFAIRS DEPARTMENT COMPLIANCE DEPARTMENT ORGANIZATION AND HUMAN RESOURCES DEPARTMENT gaming The HBG Gaming organization model is based on three Business Units: AWP&VLT, Bingo & Casino and Online Gaming and Bets, as well as 5 Departments ensuring the correct management and working for the correct implementation of the corporate Mission.

24 022 ETHICS AND RESPONSIBILITY Fairness, transparency and quality are fundamental values for HBG Gaming. Our company commitment focuses on the adoption of an internal control system able to prevent illicit behaviours from board members, employees, representatives and business partners. Compliance HBG Gaming also created a Compliance Department in order to ensure the compliance with the law and to make sure that internal procedures are in line with the goal of avoiding the breach of rules. In particular, the Department deals with the ADM regulatory provisions. The absolute compliance with the law provisions and the commitment to work to ensure a legal, safe and responsible gaming are at the very basis of the HBG Gaming corporate philosophy. Honesty and ethics are fundamental principles, also highlighted in our Ethical Code. 231/2001 Organization Model All the HBG Gaming Group companies adopted a Management and Control Organization Model in order to prevent and tackle the commission of crimes envisaged by Decree 231, through a structured system of procedures and a continuous monitoring on the implementation of said system. The Ethical Code is part and parcel of the Model needed for Management and Control Organization and represents the tool used by HBG Gaming to turn values and principles into behavioural norms which must by complied with by all those who work SUPERVISORY BODY The Supervisory Body (OdV) is a board made, in 2014, of 3 external members with legal competence and enabled to work as attorneys - 1 criminal lawyer and 2 civil lawyers. It is present in every company of the group. They are different bodies however made of the same people.. In 2015 an internal member, the Compliance Manager, joined this board, hence, the Supervisory Body is currently made of 2 external and 1 internal members. The Body has a two-year mandate and it is appointed by the Board of Directors. The independence of the Body is guaranteed by the fact that it hierarchically reports to the Board of Directors to which responds directly and has an available annual budget allocated for any necessary need for the correct performance of its duties. The body has a self internal Regulation guiding its activities. In 2014, the OdV met each month and, during every meeting, the Regulatory Compliance Manager (who is currently a member of the OdV) participated as a supporting reference with the duty of bridging the Body with the competent corporate areas for the provision of information required. The information flows to be submitted biannually to the OdV were defined and both deadlines were complied with.

25 023 in the company and are related to it. This is to further confirm that HBG Gaming takes responsibility in transferring in all of its companies those transparency and clarity principles in doing business, but also those participation and values and goals sharing principles with all the people working in HBG Gaming. IThe 2001 Decree 231 envisages the, non-compulsory, adoption of an Organization Model aimed at reducing the risk of committing the crimes envisaged by the Decree itself. HBG Gaming decided to adopt the Organization, Management and Control Model approved in December 2013 and updated on 27 April The complete version, including the special part, is available to the employees on the corporate intranet. The general part of the Organization Model has been published on the website. After the reception of said information the OdV asks sample information and/or supporting documents to analyse to verify the correctness or any process control shortcoming. In 2014, the Supervisory Body required information reports on some legal-corporate affairs involving the holding company and which concluded with the full acquittal of HBG Gaming. ACTIVITIES CARRIED OUT BY THE SUPERVISORY BODY In 2014, on OdV suggestion, the infragroup contracts were updated and the internal functions proxies were formalised for key staff, who, having particularly sensitive roles, carry out cross-cut activities for the whole group. TRAINING ON 231 ORGANIZATION MODEL The staff was trained in 2013 and 2014 and training activities also continued in For the newly hired people a brief induction on the 231/01 topic, the Ethical Code and the 231 model is provided with a detailed brochure.

26 024 Ethical Code For HBG Gaming it is paramount that values inspiring its activities are not just abstract principles but that they translate into facts in everyday activities. This is why an Ethical Code was drafted and adopted, a tool showing the behaviour that all employees, board members, Statutory Auditors, collaborators and commercial partners must stick with. The Ethical Code, part and parcel of the Organizational Model 231, translates values into principles and behavioural norms by which all those who work with the company must abide. In particular, the Ethical Code stresses out the corporate mission, consisting in providing the IT network management service of entertainment and Bingo devices applying the highest quality and transparency standards. The performance of activities must be oriented towards efficiency and effectiveness principles; the continuous improvement of the organization, human and technical resources, network reliability must be pursued and, finally, the management of customer relations must be focused on courtesy and professionalism. This must be carried out performing our own activities in full compliance with European and national regulations, cooperating with the Customs and Monopolies Agency and with all the public Authorities in order to guarantee a safe, legal and regular entertainment, fighting corruption and any other illicit practice. The performance of professional duties by employees and cooperators according to diligence, competence, professionalism efficiency, honesty and transparency principles is of fundamental importance. In order to make the Code something more that a mere list of good intentions, HBG Gaming created the Supervisory Body supervising on the factual compliance with the aforementioned principles, turning them into everyday behaviours in the performance of everybody s actions.

27 THE ETHICAL CODE, PART AND PARCEL OF THE ORGANIZATIONAL MODEL 231, TRANSLATES VALUES INTO PRINCIPLES AND BEHAVIOURAL NORMS BY WHICH ALL THOSE WHO WORK WITH THE COMPANY MUST ABIDE.

28 QUALITY AND CERTIFICATIONS SYSTEM 026 From 2009, HBG Gaming took an a Quality path leading to the UNI EN ISO 9001:2008 certification. This certification proves the implementation of a Corporate Management System able to provide products and services guaranteeing the compliance with the regulation requirements and the maximum customer satisfaction. The survey was carried out between November 2014 and February 2015, according to the aforementioned modalities. Currently, the certified companies of the Group are: HBG Connex S.p.A. achieving the Certification for the Creation and operational management of the IT management network for legal gaming. HBG On Line Gaming S.r.l. achieving the Certification for the Drafting and provision of functional services for public gaming through a physical network of shops. Customers satisfaction is a successful factor for HBG Gaming; this is subject to an annual survey through the provision of a questionnaire which can be filled in accessing to a dedicated web platform. In 2014, questionnaires were handed to HBG Gaming Customers. The methodology employed, crossing expressed satisfaction and importance given to the aspect under analysis made it possible to map intervention priorities. As an example, here are the outcomes of the survey on satisfaction of some HBG Gaming types of Customers on the service provided: AWP Managers and Gaming shop Managers. AWP Managers Hereunder are the surveyed areas: Administrative management time Regulatory information Staff competence and courtesy Phone assistance Availability of reference people Administrative management time Regulatory information transmitted by HBG Staff availability, competence and courtesy Availability of your commercial contact person Availability of your administrative contact person Availability of your customer service contact person Phone assistance level 0.0% 3.6% 9.6% 2.4% 7.2% 6.0% 14.5% 4.8% 9.6% 4.8% 4.8% 2.4% 80.8% 88.0% 86.8% 85.6% 96.4% 92.8% 94.0% 2.4% 3.6% 0 25% 50% 75% 100% POSITIVE SUFFICIENT NEGATIVE

29 027 Shop Managers Hereunder are the surveyed areas: Regulatory information Phone assistance for commercial or administrative issues Technical assistance Screens and TVs Gaming system The survey was carried out between December 2014 and February 2015, according to the aforementioned modalities. In 2015 a project for the achievement of the ISO 9001 quality Certification of the Management System was also started for the Bingo business. The principles of the norm have already been implemented and the third-party Audit with the Certification Body has been planned. How do you assess the availability, competence and courtesy level of your HBG contact people? How do you asses the technical assistance level in the Shop regarding the services provided? (Gaming System - SNAI) How do you asses the technical assistance level in the Shop regarding the services provided? (Screens and TVs) 33.34% 25% 41.66% 8.33% 25% 66.67% 100.0% How do you assess the HBG phone assistance level for commercial and administrative issues? 8.33% 8.33% 83.34% How do you assess the HBG phone assistance level in terms of regulatory updates? 8.33% 8.33% 83.33% 0 25% 50% 75% 100% POSITIVE SUFFICIENT NEGATIVE

30 028 CERTIFICATION OF THE INFORMATION SECURITY MANAGEMENT SYSTEM HBG Gaming took an evolutionary path for the achievement of the ISO/IEC 27001:2013 Certification aimed at preserving the availability, confidentiality and integrity of the processed information, including aspects on logical, physical and organizational security. The evolution of technologies and networks allowed the development of advanced services which entered in our everyday life and which use entailed an increasing need to share and spread our information. Policy-makers around the world affirmed the right to protection of data, however, we are seeing the proliferation of increasingly sophisticated attacks, aimed at compromising information by exploiting any possible vulnerability, from IT infrastructure to applications, from processes to behavioural practices. In this field, HBG Gaming thinks that the adoption of a formal Information Security Management System in line with what set forth by the ISO/IEC 27001:2013 international standard is an enabler to: Strengthen the trust with its stakeholders, through the adoption of increasingly safer systems; Guaranteeing service continuity, reducing IT risks and the subsequent drop of negative impacts; Stand out in its reference market, creating added value. In 2014, several initiatives were started, involving: The staff, spreading the security culture, formalizing internal organisation flows and revising information access privileges. The processes, defining risk analysis work flows and the implementation of appropriate security policies, aiming at achieving control goals to guarantee information privacy, integrity and availability. the infrastructures, revising protection measures on systems and developing centralised security platforms. OTHER PROJECTS The Department is assessing further certification hypotheses aimed at further improving the management quality and level. The first project envisages the OHSAS 18001:2012 Certification regarding the Workplace Safety and Health management system, a standard going beyond the minimum requirements of law and which envisages the voluntary adoption of a management model for further staff protection. An other project under assessment is the adoption of ISO:26000 Guidelines on Social Responsibility in order to integrate socially responsible behaviours in HBG Gaming strategies, systems, practices and processes.

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32 THE GAMING MARKET 030 The HBG Gaming Group operates in the market of games with money at stake, regulated by the Customs and Monopolies Agency. According to the SISTEMA GIOCO ITALIA data, the gaming industry is made of: Around 120,000 points of sale, for the majority of which the marketing of the different gaming typologies is an important source of revenue with a relevant support in covering costs. The figure includes bingo rooms, betting agencies, rooms with entertainment devices and point of sales of competitions at odds, lotto and lotteries (source: Confindustria Sistema Gioco Italia estimate); More than 6,600 companies (figure of the Milan Chamber of Commerce, year 2012). The sector provides employment for around 140,000, summing up: employees of devices Licensees, managers and producers (around 20,000); workers in the correlated industry (local maintenance of technology devices, commercial supports, etc.); workers who, in points of sale, work in the management of gaming activities (usually as part of everyday activities). In 2014, the overall gaming revenue amounted to billion Euro, dropping by 243 million from 2013 (-0.3%). Wins represented 79.2%, hence, players net expenditure amounted to billions. The revenue service benefited from an income amounting to billion Euro.

33 031 GAMING FAMILIES NUMBER OF LICENSES SPORTS AND HORSE-RACING BASED GAMES 296 ONLINE GAMING LICENSES (GAD) 107 NUMERIC BETTING POOLS 1 LOTTO AND LOTTERIES 1 ROOM BINGO 222 DEVICES SECTION 6a AND 6b 13 Source: 2014 Blue Paper - Customs and Monopolies Agency NATIONAL GAmING VOLUME OVERVIEW GAME COLLECTION WINS PLAYERS EXPENDITURE(*) TAX REVENUE DEVICES 25,422 25,382 19,042 18,942 6,380 6,440 3,229 3,224 VLT 22,085 21,388 19,091 18,195 2,994 3,192 1,104 1,069 SECTION n.d. (**) n.d. (**) BINGO 1,664 1,624 1,042 1, HORSE-RACING BASED GAME SPORTS BASED GAME 3,822 4,250 3,041 3, NUMERIC BETTING POOLS 1,376 1, LOTTERIES 9,612 9,441 6,956 6,833 2,656 2,607 1,486 1,462 LOTTO 6,333 6,629 4,128 4,473 2,205 2,156 1,210 1,114 REMOTE TOURNAMENT ABILITY GAMES CARDS GAMES ORGANIZED IN OTHER FORM THAN TOURNAMENT AND FIXED- RATE LUCK GAMES 12,429 11,584 12,052 11, VIRTUAL BETTING 17 1, BETTING EXCHANGE TOTAL 84,728 84,485 67,273 66,954 17,455 17,531 8,179 7,959 (*) Given by the difference between collection and wins Data in millions of Euro Note: Section 7 wins are premiums in kind Source: 2014 Blue Paper - Customs and Monopolies Agency

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35 COLLECTION BREAKDOWN IN PERCENTAGE 033 REMOTE TOURNAMENT ABILITY GAMES < 1% COLLECTION VLT 25% SPORTS BASED GAME 5% SECTION 7 < 1% GAME 2014 DEVICES 25,382 VLT 21,388 CARDS GAMES ORGANIZED IN OTHER FORM THAN TOURNA- MENT AND FIXED-RATE LUCK GAMES 11,584 LOTTERIES 9,441 LOTTO 6,629 SPORTS BASED GAME 4,250 HORSE-RACING BASED GAME < 1% LOTTO 8% BINGO 2% BINGO 1,624 NUMERIC BETTING POOLS 1,188 VIRTUAL BETTING 1,148 REMOTE TOURNAMENT ABILI- TY GAMES 734 LOTTERIES 11% DEVICES 30% HORSE-RACING BASED GAME 682 SECTION BETTING EXCHANGE 205 Data in millions of Euro CARDS GAMES ORGANIZED IN OTHER FORM THAN TOURNAMENT AND FIXED-RATE LUCK GAMES 14% VIRTUAL BETTING 1% BETTING EXCHANGE < 1% NUMERIC BETTING POOLS 2%

36 034 As you can see from the chart here under reporting the evolution of the gaming market between 2007 and 2014, the overall collection, growing until 2012, has had a slight drop in the last two years. The Compound Annual Growth Rate (CAGR) is however positive and amounts to 10.7%. GAMING MARKET ANNUAL GROWTH RATE 100,000 80,000 79,814 88,572 84,728 84,485 CAGR +10.7% 60,000 54,120 60,985 40,000 41,418 47,555 20, The Entertainment Devices (ADI), regardless of last years slight drop, have a 14.6% annual growth rate and represent 55.6% of the total collection of the whole market in Sports betting recovered last year (+11%), leading the periodic annual growth rate to 6%. Analysing the individual sectors, in 2014 there was a strong drop from last year of Superenalotto (-14%), Lotteries (-2%), remote gaming (-7%) and horse-racing based gaming (-16%). Bingo has had a slight drop, with a billion Euro collection (-2.4%), mainly due to the online segment (-10.9%).

37 035 The Gaming Sales Network in Italy has 218 Bingo Rooms, 88,922 venues with New Slots, 4,834 VLT rooms, as well as tens of thousands of points of sale for Competitions at Odds, Horse-Racing Gaming, Sports Gaming, Lotto and Lotteries, etc. as in the table. BINGO BINGO ROOMS COMPETITI ONS AT ODDS POINTS OF SALE NUMERIC BETTING POOLS. NBP POINTS OF SALE SALES NETWORK FOR GAMING KIND HORSE-RACING GAMING SPORTS GAMING LOTTO AND LOTTERIES HORSE- RACING POINTS OF SALE HORSE- RACING SHOPS SPORTS POINTS OF SALE SPORTS SHOPS SPORTS AGENCIES LOTTO OFFICES LOTTERIES POINTS OF SALE 218 9,935 36,540 3,584 2,233 4,572 1, ,926 65,303 excluding entertainment devices sector ENTERTAINMENT DEVICES SECTOR SALES NETWORK SECTION 6 DEVICES SECTION 6b DEVICES SECTION 7 DEVICES (New Slot) (VLT) New Slot VLT VENUES VLT VLT ROOMS DEVICES 377,471 88,922 50,654 4, ,033 Source: 2014 Blue Paper - Customs and Monopolies Agency

38 THE HBG GAMING MARKET 036 The HBG Gaming Group is one of the main operators in the safe and legal gaming sector regulated by the Customs and Monopolies Agencies ( ADM, former Independent Administration of Government Monopolies AAMS ). In the gaming portfolio of HBG Gaming are Bingo, Amusement With Prizes ( AWP and Videolottery VLT ), Remote Gaming (also Online Gaming ) and Sports and Horse-Racing Betting. In 2014, the HBG Gaming Group collection reached billion Euro, increasing by million Euro from 2013 (+2.4%) with an overall growth by 22.6% in the last 3 years regardless of the drop of the Italian economy which recently involved also the Gaming sector. HBG GAMING COLLECTION BINGO New Slot 2,867 2, , ,306 VIDEOLOTTERY 508 1,157 1,766 1,888 SKILL GAMES BETTING N.D. N.D. N.D. 9.4 TOTAL 3, , , ,326.4 Data in millions of Euro OVERALL GAMING COLLECTION ,814 88,572 84,728 84,485 Data in millions of Euro MARKET SHARE % 4.3% 5.0% 5.1%

39 COLLECTION TREND data in millions of Euro , , , BINGO ,306 NEW SLOT COLLECTION TOTAL COLLECTION TOTAL 10, , , ,888 VIDEOLOTTERY SKILL GAMES COLLECTION TOTAL 5,319 COLLECTION TOTAL 40.75

40 038 HBG Gaming Group related players net expenditure, which is gross expenditure (collection) minus wins, amounted to million Euro in HBG GAMING - PLAYERS NET EXPENDITURE VLT AWP Bingo Betting Online TOTAL Data in millions of Euro TAX REVENUE AND PLAYERS NET EXPENDITURE RATIO VLT AWP Bingo Betting Online TOTAL Data in millions of Euro TAX REVENUE RELATED TO HBG GAMING COLLECTION VLT 21% 38% 48% 45% AWP 52% 49% 52% 51% Bingo 40% 40% 40% 40% Betting % Online 20% 43% 44% 32% TOTAL 49% 47% 51% 49% Players net E x p e n d i t u re Total Tax Total HBG GAMING - PLAYERS NET EXPENDITURE AND TAX REVENUE revenue Data in millions of Euro

41 039 TAX REVENUE RELATED TO HBG GAMING COLLECTION, 2014 DATA Corresponding tax revenues, in 2014, amounted to million Euro, which is 49.3 % of players expenditure, growing by 3.2 million Euro from VLT AWP BINGO + BETTING+ ONLINE Data in millions of Euro HBG GAMING PLAYERS NET EXPENDITURE AND TAX REVENUE PLAYERS NET EXPENDITURE TAX REVENUE RELATED TO HBG GAMING COLLECTION VLT Data in millions of Euro TAX REVENUE Data in millions of Euro AWP BINGO + BETTING + ONLINE

42 040 Fighting illegal gaming With the regulation of the gaming sector, the Government, the Licensees and the Associations were the protagonists of the fight against crime to protect players, develop technological innovations and creating jobs in the Country. This fruitful cooperation, also with the dialogue and the exchanges with other institutions, allowed and still allows to tackle gaming-related issues. BINGO ROOMS DISTRIBUTION IN THE TERRITORY BINGO The Group manages 16 Bingo rooms all over the national territory through 3 companies: Bingo Plus Spa, Latina Bingo Srl, HBG Arcades Spa. In order to guarantee an increasingly comfortable gaming environment and to broaden the offer, these rooms were renovated and improved in recent years. Bingo rooms became an even more welcoming place, thanks to the broadening of the offer, from AWP to VLT and new further activities, such as bars and restaurants, aimed at improving socialization and sharing, in the light of the promotion of responsible gaming. All the gaming environment for Bingo, AWP and VLT are equipped with AC and provided with smoking areas. Moreover, they are equipped with comfortable furnitures to make the most of the gaming experience and to guarantee the total player s relax, representing the top offer in the market. In 2014, the Groups Bingo rooms achieved an overall collection of million Euro, growing by around 12.2 million Euro (+2.7%) from 2013, which amounted to million Euro.

43 041 COLLECTION WITH DIFFERENT PRODUCTS OFFERED IN BINGO ROOMS 16 BINGO ROOMS IN ITALY BINGO COLLECTION VLT COLLECTION SLOT COLLECTION MORE THAN 6,000 SEATS MARKET SHARE Data in millions of Euro 500 EMPLOYEES IN THE ROOMS % 7.15% 6.85% 7.02% MILLION EURO COLLECTION 780 New Slot AND VIDEOLOTTERY 7.02% MARKET SHARE HBG GAMING BINGO BINGO MARKET All data in millions of Euro

44 042 The history of Bingo Bingo, based on the drawing of 90 numbers, derives from Lotto and it is very similar to the tombola, the traditional raffle played for centuries in Italian families. The origins can be traced back to 1500, when people started to play Lotto in Italy. The name Bingo comes from the game Beano (from Bean) played in the United States due to the dried Beans used to cover the drawn numbers on the sheets. The first who covered all the numbers in a sheet shouted Beano! to announce his/her victory. However, a lucky winner once shouted Bingo! instead of Beano and, from that day on, the game changed its name. Bingo arrives to Italy with Law n. 133 of 13 May 1999 and with the Ministerial Decree n. 29 of 31 January Regulation setting provisions for the «Bingo» game. The control over the game is reserved to the Government which carries it out from 2000, at first through AAMS (Independent Administration of Government Monopolies) and now through ADM (Customs and Monopolies Agency). The Administration provides licenses to private entities, who bring about investments and appropriate business tools and manage the game according to the rules, which compliance is constantly monitored, aimed at protecting the general public. The Italian legislation intends Bingo as an amusement, socialization and pleasant activity in the spare time. (Taken from Customs and Monopolies Agency - Bingo)

45 043 NEW SLOT AND VIDEOLOTTERY The Entertainment Devices market has been regulated by the 2002 Financial Law, created to fight against illegal gaming. The legislation defined the licit devices, dividing them in two categories: devices without money prizes, such as those with object prizes (cranes, skill draws, etc.) or used for amusement purposes only, such as videogames, billiards, table football, flippers; money prizes devices such as New Slots (or AWP Amusement With Prizes) and Videolotteries (VLT). HBG Gaming is one of the partners chosen by the Customs and Monopolies Agency (ADM), after a public tender, for the creation and the management of the legal gaming IT network through Entertainment and Amusement Devices envisaged by article 110, section 6 of the Single Book on Public Security Laws (TULPS), contained in the Royal Decree 18 June 1931 n. 773 and following amendments and integrations. NEW SLOTS (OR AWP AMUSEMENT WITH PRIZES) The amusement devices with money prizes segment started in 2004 with New Slots and has immediately had a great success. Nowadays, 377,000 of them are distributed all around Italy and are managed with one of the broadest and most advanced IT networks in the world. Since 2004, the management has been allocated to 10 licensees chosen by the Customs and Monopolies Agency after a public tender, operating in the market with different business models. There are currently 13 of these licensees. On 20 March 2013, HBG Connex S.p.A. signed the new license for the management of the IT network until The business model pursued by the HBG Gaming Group in the AWP market is characterized by a prevalent provider model orientation, with a quota of devices installed also in directly managed Bingo rooms. Over the last three years, the Group has had a constant improvement of results, in particular in the management of service levels in the IT network management. The Group has 11,074 points of sales in which 30,600 AWP owned by 498 Managers are installed.

46 044 Manager The manager is the owner/holder of New Slots, having the authorization envisaged by art. 86 and 88 of the Single Book on Public Security Laws and owner of a contract with the licensee. He carries out activities for the availability of New Slots, their functioning and the collection and provision of residual amounts to the licensee. NEW SLOTS TERRITORIAL DISTRIBUTION Operator The operator is the owner of the venue in which New Slots are installed, it is provided with appropriate structures and capacities and holds the Requirements envisaged by the 17/05/2006 Decree: Third Parties in Charge of Collection. Distribution of New Slots Collection The total amount introduced in every device must be reallocated in wins for at least the 74%, 12.70% goes to Internal Revenue Service as Single Tax Charge (PREU), 0.80% goes to the Customs and Monopolies Agency as deposit and license fee, while the rest of the collection goes to the partners on the basis of what set forth in contracts with the reference licensee. NEW SLOTS GAMING LINE gaming MANAGER OPERATOR

47 045 NEW SLOTS MARKET COLLECTION ,031 27,772 25,725 25,613 Data in millions of Euro NEW SLOTS HBG GAMING COLLECTION 30,600 NEW SLOTS 11,000 VENUES ,867 2,552 2,335 2,306 Data in millions of Euro MARKET SHARE % 9.2% 9.1% 9.0% MORE THAN 480 MANAGING PARTNERS COLLECTION TREND New Slots MARKET COLLECTION New Slots MARKET COLLECTION New Slots HBG GAMING 2,306 MILLION EURO COLLECTION MERCATO NEW SLOT % MARKET SHARE NEW SLOT HBG All data in millions of Euro

48 046 Business to Business services HBG Gaming gives special attention to its own Business Partners, offering them a dedicated assistance, structured on various level, through a Customer Care, a Technical Help Desk and a Specialists Team. DESK It is the website dedicated to the New Slots remote management. Provided with a clear and user friendly interface, it allows the operator to carry out any operation with a few clicks, 24/7 with no time limit. There are many functions available, allowing to manage administrative practices, query and find location and counters of New Slots and PDA, view and print reports and much more. VLT Manager System (VMS) It s the online solution for the room manager, with which one can manage room details; see reports on bets and wins, doing the Preu calculation, ADM fee, etc.; printing the periodic statement and daily reports of one or more rooms also for specific periods.

49 047 VIDEOLOTTERY TERMINAL - VLT Videolotteries (VLT) are different from AWP in terms of technology, playing modes and types of wins. They were introduced in Italy by Law 184 of The HBG Gaming Group, in compliance with the provisions set forth in the 15 September 2009 public tender, achieved the authorization to install 4,798 video devices in 467 gaming rooms. The gaming platform managing partners are Novomatic, Spielo and Inspired. Compared to New Slots, VLT are organized in a way in which ADM keeps control of devices and individual games as well as the control of points of sale together with the different law enforcement agencies, licensees have a central role in the management of the game, especially from the technological and product point of view. The maximum cost of a single bet is 10 Euro, with a minimum bet of 0.50 Euro. Maximum win for each game, except jackpots, is 5,000 Euro. The maximum cost of a single bet is 10 Euro, with a minimum bet of 0.50 Euro. Maximum win for each game, except jackpots, is 5,000 Euro. Comprehensively, 60,567 authorizations to install were given by the ADM, 58,647 of them were given to the 10 historic licensees in 2009 and 2013 and 1,920 of them to the 3 new licensees (Intralot, NTS Network and Netwin) in In 2014 the total market collection amounted to billion Euro, a 3.2% drop from the previous year. HBG Gaming collection rose to billion Euro, with an 8.8% market share. VLTs have peculiar characteristics making them very different from current AWPs and have a potential market which is far broader than AWPs.

50 048 Videolottery collection distribution The total amount introduced in every device must be reallocated in wins for at least the 85%, 5% goes to Internal Revenue Service as Single Tax Charge (PREU), 0.80% goes to the Customs and Monopolies Agency as deposit and license fee, while the rest of the collection goes to the partners on the basis of what set forth in contracts with the reference licensee. VIDEOLOTTERY TERRITORIAL DISTRIBUTION VIDEOLOTTERY GAMING ORGANIZATION VLT GAMING SYSTEMS PROVIDER gaming ROOM MANAGER

51 049 VIDEOLOTTERY MARKET COLLECTION ,865 22,344 22,085 21,388 Data in millions of Euro HBG GAMING VIDEOLOTTERY COLLECTION ,157 1,766 1,888 Data in millions of Euro 4,798 VIDEOLOTTERY RIGHTS MARKET SHARE % 5.18% 8.00% 8.83% 467 INSTALLED VLT ROOMS 1,888 MILLION EURO COLLECTION COLLECTION TREND VIDEOLOTTERY MARKET COLLECTION VIDEOLOTTERY MARKET COLLECTION VIDEOLOTTERY 8.83% MARKET SHARE VLT NOVOMATIC, SPIELO AND INSPIRED All data in millions of Euro

52 050 REMOTE GAMING With the Smartgames.it web platform, HBG Gaming guarantees everybody who has an internet connection the chance to have fun at home at any time. TERRITORIAL DISTRIBUTION OF GAMING SHOPS Registered users can bet on sports and horse-racing events, play with online Slot Machines and Bingo or take part to Texas Hold em Poker tournaments, including Cash Games. The advanced and reliable gaming platform guarantees high security standards and it is fully compliant with the law and the requirements set forth by the Customs and Monopolies Agency. HBG Gaming offers a complete remote money prize games portfolio, including, along with skill games, Sports and Horse-racing bets, Casino games such as Roulette and Slot Machines and the new bets on virtual events launched in The remote gaming licensees, connected in real time to the central ADM IT system supervising gaming and calculating the tax due, work to guarantee:: gaming safety; a minimum win percentage return, set according to the law and the type of game; transparency and privacy of processed information. Every player is duly identified in compliance with current regulations and is provided with a gaming account which can be refilled through electronic payment tools such as e-wallets, credit cards, PostePay rechargeable credit cards and wire transfers or through prepaid cards sold in designated venues. Wins, in turn, can be withdrawn in any moment with wire transfers, PostePay credit card recharges and e-wallet transfers, or in small amounts in cash by booking their withdraws in Smartgames shops.

53 051 BETTING To fulfil the needs of those customers who love to have amusement in venues, HBG Gaming broadened its offer participating in the tender for the allocation of licences of public games, opening 52 gaming shops (42 at the end of 2014) aimed at the collection of sports, horse-racing and virtual bets. They are located in almost all Italian regions, with a particular concentration in the Centre-South area. The SmartGames branded shops, along with offering the opportunity of betting on sports, horse-racing and virtual events, are also equipped with other gaming products such as New Slots and Videolotteries. Bar Area, smoking and non-smoking rooms, smartgames-.it gaming account recharge service are other services made available to customers. 42 GAMING SHOPS LICENCES 10 BETTING SHOPS 9.4 MILLION EURO BETTING COLLECTION 8.7 MILLION EURO SKILL GAMES COLLECTION The three-year license achieved in 2013 is about the joint management of the following public games in the physical shops network: fixed odds betting on sports and non/sports events, other than horseracing; pool betting on sports and non/sports events, other than horse-racing; fixed odds and pool betting on horse-racing; horse-racing and sports competitions at odds; national and international horse-racing games; betting on simulated events. HBG Gaming adopted an advanced and reliable gaming platform made available by chosen technological partners, through which betting acceptance is controlled and validated in real time connection with the National System managed by ADM. Smartgames shop put at players disposal a real time odds visualization system and a satellite TV system showing live coverage of sports and horse-racing events. *Data updated in December Source: MAG

54 Second part DIALOGUE WITH STAKEHOLDERS

55 Allegro, adagio, vivace, crescendo: this is the music tempo, written on the staff. They are generally written in Italian, since Italian is the language of music. They are a technical index which can be measured with a tool: the metronome. However, they also convey an emotional message. It is the Conductor s duty to manage the play of emotions both from a balance with rational components and with the subjects involved, the orchestra, the singers and the set designers. In the same way, the company must be able to blend all the different components into an harmonious and effective management, in which all organization, rational, numerical, quantitative and economic feature must be tuned to what Goleman calls emotional intelligence, with enthusiasm, with passion. The harmony among people in the company and any other partner and stakeholder is a fundamental element to play the score with discipline, emotion and passion.

56 054 BANKS The term Stakeholders includes all people and groups who may affect or may be affected by company operations. HBG Gaming would like to give account of its own commitments, aimed at a management putting sustainability at its core, first of all to all those who have this strong relation with the company. Following this logic, we identified and mapped 12 big stakeholders groups. REGULATORS SHAREHOLDERS OUR TEAM gaming Particular attention is given to our Team, Partners and Community in this Social Report. NATIONAL TAX SYSTEM OUR PARTNERS COMMUNITY GAMING OPERATORS CONSUMERS GAMING INDUSTRY ASSOCIATIONS PRESS AND MEDIA AUTHORITIES

57

58 OUR TEAM 056 HBG Gaming success comes from teamwork. Our company processes have a common element: people; all our strategies owe their success to the commitment and the professionalism of people. Teamwork is a delicate and complex goal in which everyone share targets, everyone is aware of its own role, knows who to interact with and who to tell the outcomes of its work. Our company stands out for its professional and behavioural harmony, in which positive corporate results go along with relationships of people who are kind and confident. Whoever joins HBG Gaming will find a welcoming and friendly environment and will deal with a company in which people are the real competitive driving force. Their competence and capacity to grow are the key for the company to react to market transformations and to constantly increase the quality of the services provided. gaming HBG Gaming staff is equally split in men and women, giving account of the application of selection and hiring policies excluding any kind of gender discrimination. STAFF DISTRIBUTION PER GENDER WOMEN MEN TOTAL

59 STAFF BREAKDOWN PER AVERAGE CORPORATE AGE TEMPORARY CONTRACT PERMANENT CONTRACT WOMEN MEN AVERAGE AVERAGE CORPORATE AGE From the Human Resources perspective, HBG Gaming has had an average employment stabilization in the last two years, even is room staff has almost doubled: from 85 employees in 2010 to 157 in This allowed for the arrival of highly qualified resources, mostly with graduation titles. This phenomenon is particularly significant if compared to the overall difficulties of the Italian labour market and the waste of young talents. HBG Gaming confirmed its choice, as in the past, of hiring staff on a permanent contract, a typology representing 90% of the total. The company is aware that labour stability is an essential condition to create a united an motivated team, making sense of belonging one of its key features. STAFF BREAKDOWN PER AGE WOMEN MEN AVERAGE AVERAGE AGE The HBG Gaming Staff particularly stands out for being a young team: average age is for women and for men. In HBG Gaming, staff composition did not change much in the years and the detailed analysis shows a high corporate age if compared to the age of the company, in particular with regards to Bingo rooms, showing the great sense of belonging. This result comes from the hiring policy implemented when opening Bingo rooms, in that phase the hiring of young, and motivated staff, who is still working in the rooms, was encouraged. STAFF BREAKDOWN PER LEVEL MANAGERS SUPERVISORS EMPLOYEES TOTAL

60 ATTENTION TO OUR PEOPLE 058 WELLNESS AT THE CORE HBG Gaming knows the importance of having a working environment in which attention is given to the internal atmosphere and to the physical, psychological and social wellness of all collaborators. We want to support our People in achieving a balance among personal, professional and role development needs, promoting a life-work balanced model preserving the balance among work, personal duties and family life. This constant attention by HBG Gaming for the wellness of its own people is expressed in many ways and it is proven by a factual commitment, which translates into the acceptance of working time reduction and granting of part-time solutions whereas possible. STAFF BENEFITING FROM PARENTAL LEAVE MATERNITY PATERNITY TOTAL In the last two year, staff benefiting from parental leave rose in a very significant way from the previous two-year period, as well as milking hours have increased, going from 2854 in 2013 to 3661 in 2014.

61 059 STAFF RECRUITMENT In the staff selection and hiring process the company is constantly driven by equality, transparency and meritocracy principles according to the fundamental rules driving it and to its own Ethical Code. At the same time, the company commits to guarantee equal opportunities for each employee, excluding any kind of discrimination. The HBG Gaming staff need is planned annually according to the development plans envisaged for each Product, taking into account labour cost and available budget. The selection process aims at ensuring the human resources quality and quantity need and it is regulated by a specific-purposed procedure. HBG Gaming makes the most of the resources already in the company and, as a consequence, when new staff demand arises, internal applications are the first one taken into consideration, aiming at favouring growth and development of new skills of the staff already in place. If the searched profile is not compatible with the present professional figures, HBG Gaming will head on the external market While looking for potential candidates, the company is supported by specialized Companies that must comply and share the same equity, transparency and fairness principles characterising HBG Gaming actions. Moreover, the company pays special attention to all those who participate in the selection process and provides a structured feedback to all participants - regardless of the outcomes of the interview - which is also aimed at labour market guidance

62 060 PROTECTION OF DIVERSITY HBG Gaming pays special attention to the issues of labour and prevention of any possible form of discrimination. It guarantees equal opportunities for every collaborator, irrespective of his/ her ethnicity, political and religious belief, national origin, age, gender, sexuality, civil status and different abilities. Concerning the latter, the company identified a set of policies guaranteeing equality of treatment for all types of diversity. Among the projects supporting this corporate strategy, HBG Gaming implemented a fruitful collaboration with employment centres from different parts of Italy through specific agreements that are not only aimed at complying with legal requirements but also at increasing targeted recruitment, also through the implementation of internships. These internships aim at encouraging labour guidance and experiencing a specific professional area, fully protecting disabled workers. PLACEMENT WITHIN THE COMPANY In HBG Gaming, newly hired employees are welcomed and guided in the initial phase by Human Resources and their colleagues. In order to favour their full integration within the company, a phase of Induction and basic training has been included, in which the main corporate communication and operational flows are explained through the analysis of the internal regulation, operational procedures and standards, the Codes of Ethics and the guidelines adopted. The purpose is to make sure that newly hired employees immediately feel part and parcel of the team, become aware of their own role within the organization and share its values and organizational culture. COMPULSORY TRAINING ACTIVITY AND HEALTH SURVEILLANCE Within the activities performed to protect its own collaborators health and safety, the company organises specific training courses on safety, first aid and fire prevention, both in classroom training and e-learning; since 2014, the company has had an e-learning platform aimed at providing training on safety concerning the general part (Leg. Dec. 81/08 art. 36 and 37) lasting 4 hours. The e-learning methodology - at first only implemented in the head office - will be brought also to Bingo rooms starting from The tables hereunder show a summary of the training activities related to health and safety at work performed in Moreover, in compliance with the current legislation, all workers are subject to periodic health surveillance depending on their task. Concerning training activities on safety, HBG Gaming Human Resources is currently dealing with a project entailing both the adoption of advanced training tools within the compulsory training area, and a broadening of the concepts of health and safety indicated in the legislation. HBG Gaming is currently assessing the possibility of getting the OHSAS certification, entailing an advanced management system for health and safety at work.

63 061 LOCATION MEDICAL EXAMIN. EMPLOYEES HEAD OFFICE 36 ROOMS 404 TOTAL 440 LOCATION TRAINING on safety - specific TRAINING on safety - refresh TRAINING on first AID - refresh E-LEARNING HOURS EMPL. HOURS EMPL. HOURS EMPL. HOURS EMPL. HEAD OFFICE ROOMS TRAINING on safety - specific TRAINING on safety - refresh TRAINING on first AID - refresh E-LEARNING TOTAL MAN HOURS TRAINING MAN HOURS TRAINING ON SAFETY TRAINING ON SAFETY - REFRESH TRAINING ON SAFETY - SPECIFIC E-LEARNING TRAINING ON FIRST AID - REFRESH

64 GROUP BUILDING AND INDIVIDUAL GROWTH 062 The Human Resources stakeholder is the key factor for HBG Gaming, therefore the human component organization and growth are managed by HBG Gaming in the light of a dynamic balance between individual needs and those of the group. Special attention is attached to individuals with their own characteristics for the development of their potential, the necessary convergence between their expectations and the tangible objectives they can actually aim at. Another important aspect is also the commitment for an efficient and effective organization, a system in which each individual is inserted and in which his/her own objectives of quantitative and qualitative growth are included together with the improvement of global results. HBG Gaming constantly works to meet these needs in a consistent way, believing that a system must have rules aimed at supporting professionalism and not at prevailing over it. A group of people can be cohesive and grow in terms of skills if it is supported by a good organization: the growth will then be individual and collective at the same time because the objectives of the group will meet individual ones, aiming at organizational development TRAINING ACTIVITIES COURSES EDITIONS TEACHING HOURS PARTECIPANTS CROSS-CUT TECHNICAL TOTAL

65 063 TRAINING The training process objective is to encourage the growth and development for the people working at HBG Gaming, aiming at creating a culture of shared values, objectives and knowledge that can provided an added value to the individual and the group in which the individual is included. The training activities are designed and defined on the basis of each collaborator s needs in order to make the most of each skill and to allow for a full expression of their own professional potential. Training in HBG Gaming is divided into 4 main typologies: 1. Basic training, provided in the induction phase to newly hired employees: it aims at providing essential knowledge to perform the activities within the company 2. Compulsory training, aimed at knowing the rules and legislations regulating the workplace and life within the company 3. Technical specialised training, aimed at developing task-connected skills 4. Cross-cut training, aimed at developing knowledge and skills within the corporate skills model. Training can be both internal and external. In the first case, experienced employees are involved as teachers, making their know-how available for younger colleagues growth. In the second case, external consulting and training firms support the company in the design and planning of technical and cross-cut/management courses. Moreover, it is also possible to participate in Master courses and inter-company courses. Special attention is attached to the possibility to participate in conferences and seminars that can be recommended by any member of the staff or periodically promoted by the responsible internal functions. In 2014, people in HBG were involved in seminars and conferences aimed at encouraging professional retraining or training courses on specific task-based skills. The table hereunder summarises the technical and cross-cut training activities held in TRAINING HOURS PARTECIPANTS CROSS-CUT TECHNICAL CROSS-CUT TECHNICAL

66 064 In 2014, in line with the training process started in 2013 and in order to meet the need both to work on cross-cut skills and to reinforce all skills in the HBG Gaming Skills Model, a training programme was addressed to all employees in the head office, focusing on the development of two skills in the Model: Communication and Customer Orientation(internal and external). SKILLS INCLUDED IN THE TRAINING WORKSHOP VISION OF THE HBG SYSTEM INNOVATION RESULT ORIENTATION WORKSHOP HELD IN 2013 The programme was divided into two training days for each employee in the head office, for a total of ten editions. The analysis of the data emerged from the satisfaction survey showed an excellent result: the course did not only meet expectations in terms of knowledge but it also contributed to team building and encouraged dialogue among the participants. EXECUTIVE PRAGMATISM TEAM WORK AND COMMUNICATION (internal and external) CLIENT AND MARKET ORIENTATION SELF-MOTIVATION WORKSHOP HELD IN 2013 WORKSHOP HELD IN 2013 AND 2014 WORKSHOP HELD IN 2014 COMMON SKILLS FLEXIBILITY TO CHANGE HBG Gaming aims at continuing this implemented training programme, providing workshops in 2015 that are aimed at reinforcing all skills that have been identified as a priority. RESOURCES GUIDANCE AND MANAGEMENT STRATEGIC VISION MANAGEMENT ROLES SKILLS

67 065 CONTENTS OF THE ACTIVITY RESULTS OF THE SATISFACTION SURVEY excellent Together with the need to work on cross-cut skills, the company implemented specific actions for technical specialised skills both to support marketing development objectives and to meet specific needs emerged from the results of Performance Management. TEACHING COURSE STRUCTURE ORGANIZATION TOTAL AVERAGE excellent excellent excellent excellent VALUE 5.43 Special attention was paid to the responsible gaming training. In 2014, two editions of the Rules of the Game workshop were held, aiming at raising awareness among the staff on a sensitive issue such as pathological gambling. The course was organised by S.I.I.Pa.C., Italian Organization against Compulsive Disorders. LOW da 1 a 2 POOR MEDIUM GOOD da 2,1 a 3 da 3,1 a 4 da 4,1 a 5 EXCELLENT da 5,1 a 6 All training activities have a phase of control both in terms of participants satisfaction and in terms of learning assessment; moreover, procedural and organizational aspects are monitored. In case the courses are provided in different editions, the global observation systems allows for modifications and corrections on the go.

68 HBG Gaming passion for its people is based on the adoption of a clear and effective internal communication, making corporate choices transparent, contributing to the growth and spreading of knowledge and establishing relationships based on fairness and mutual trust.

69 067 INTERNAL COMMUNICATION HBG Gaming passion for its people is based on the adoption of a clear and effective internal communication, making corporate choices transparent, contributing to the growth and spreading of knowledge and establishing relationships based on fairness and mutual trust. In addition to direct contact and both formal and informal meetings, one of the main tools is the corporate intranet, accessible to the head office personnel, managers and vice-managers of the Bingo rooms. On the intranet, institutional and organizational information is published, in addition to operational indications such as the presence of updated procedures or manuals. All the staff is constantly informed about service communications, informal and relationship-bound information, contributing to the creation of a good atmosphere within the business and good personal relationships. Performance Management The performance management system, implemented in 2013, was designed to make the most of each employee s contribution to the achievement of goals. The system is based on the HBG Gaming Skills Model, that is to say on organizational actions that are deemed important for the company and the development and professional growth of all HBG Gaming employees. The Skills Model was defined in a project that involved HBG Gaming employees in a cross-cut way, through interviews with the Management and focus groups with a sample of the corporate population. The adoption of a Performance Management system assessing the skills and the results achieved by each employee is linked to the idea of having a system in which the manager-collaborator relationship is based on constant dialogue aimed at improving and developing potentialities. Development plans definition and monitoring The Performance Management system is divided into three phases: 1. an implementation phase with the interview aimed at performance planning. This phase entails individual interviews among the managers and employees of the head office; 2. an intermediate phase to monitor the performance trend; 3. a phase in which the results achieved are shared. The Performance Management system is a process to manage and coordinate resources for managers aimed at providing the essential elements to define and plan the employees training programmes and to allow for a better growth and development of skills within the Company.

70 OUR PARTNERS 068 The stakeholders involvement represents a priority for HBG Gaming, starting from the constant relationship with its providers. The objectives of the company could not be achieved without a dialogue with the other players in the industry that are part and parcel of the big HBG Gaming team with which the company builds its business every day in transparency, in compliance with legislations and serving the consumer s interest. Careful selection, constant performance monitoring, life-long learning account for the attention that HBG Gaming pays to the relationship with its providers, because without them it would be impossible to guarantee excellent services.

71 THE RELATIONSHIP WITH PROVIDERS 069 HBG Gaming providers are 1059 in 2014: a team that has been constantly consolidated and based on shared objectives and ways to achieve them, in full respect of the final consumer. TRANSPARENCY IN THE RELATIONSHIPS WITH PROVIDERS HBG Gaming pays special attention to the compliance with service standards, regulatory requirements and the stakeholders expectations. HBG Gaming has a direct and transparent communication with its own providers, guaranteeing a high level of efficiency and professionalism as well as being integral part of its business activity and the quality of services offered. HBG Gaming level of service is directly influenced by the quality of external provisions, their cost and the supply time. Therefore it is crucial to have qualified providers that can completely satisfy the needs, as well as constantly monitoring the compliance with the service standards guaranteed in the accreditation phase. HBG Gaming adopted different tools to support the different phases of the purchase process. These solutions automatise all processes, starting from new providers search, their assessment and certification, up to the actual negotiation. This allows to achieve traceability and transparency objectives in the providers selection process and in the negotiations process through pillar managing: centralised and structured management of providers databases as well as their spokespersons and the product categories for which the certification is required; the providers accreditation, validation and approval process, in compliance with well-defined requirements; tracking and sorting all daily activities ( s, appointments, faxes, letters) performed on the databases; management of the providers documents and the related expiry/renewal/cancellation with automated notification mechanisms indicating the forthcoming documents deadline to the provider; structured and monitored management of the enquiries received by the different company departments and calls for tender, also in relation to the budget defined for every department; the providers assessment process management according to set criteria, weights and scores. PROVIDERS SELECTION AND ASSESSMENT PROCEDURE HBG Gaming attention towards the quality of its providers is made more evident by the creation of a dedicated office, the Providers Administration and General Purchases Office (AFAG). AFAG preventively assesses all providers of goods and services on the basis of the information given by the provider itself or other sources. An important phase in the partners selection is the collection of all elements that are essential to prequalification, aimed at verifying which of them have the fundamental characteristics to implement a collaboration and have the essential requirements to

72 070 meet the needs of HBG Gaming. In this perspective, the company defined a procedure to formalise a systematic routine for an equal and transparent selection and assessment of providers, through the description of the minimum requirements that the provider must have for the specific product category of reference. The following step is the ex-post evaluation, that is to say the quality control of the services actually provided by the provider and the compliance with the service levels in order to assess the validity of the selection made. Once a year, HBG Gaming assesses the provision, assigning a score for preset objectives and parameters. The Providers assessment is based on the compliance with the contracts and orders, as well as on the monitoring of any mismatch between the agreed service levels, the Service Level Agreement (SLA) and the service levels that have been actually provided. STRATEGIC PROVIDERS The strategic providers are those providing materials and services that are strongly connected to the core business, that is to say those dealing with the implementation and management of the telecommunication networks. The strategic providers efficiency is strongly related to the quality of the offered service and the connectivity and functionality of New Slot and Videolottery terminals depend on this providers competitiveness, as well as the quality of the entertainment for the final consumer. In order to maintain a high level of quality in the service, long term and transparent relationships with the strategic providers are established. These assessments can modify the provider s status and, in extreme cases, may lead to the cancellation from the register. The SLA control and the assessment of specific elements such as the compliance with the delivery time and specifications, as well as the correctness of technical and administrative documents, allow for a global analysis of the provider and the calculation of global Vendor Rating Index (VR) and partial indexes related to the fundamental categories (Timeliness, Usefulness, Flexibility). This procedure offers a complete and constant monitoring of performances and an opportunity to improve constantly.

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74 THE COMMUNITY AND RESPONSIBLE Gaming 072 HBG Gaming is one of the most important Italian operators in the safe and legal gaming scenario regulated by the Customs and Monopolies Agency and pays special attention to the final consumer s protection, being aware of operating in a sector that requires special responsibility. HBG Gaming offers a gaming system with clear and transparent rules to the final consumer, where not only fun is guaranteed but also safety, lawfulness and guarantees on wins. For this purpose, it ensures access to all games-related information, among which chances of winning, rules and risks of non-responsible gaming.

75 THE RELATIONSHIP WITH CONSUMERS 073 Gaming must be and remain a form of entertainment and amusement. The Social Responsibility characterising the whole corporate activity, however, makes HBG Gaming aware of the fact that there are problematic elements related to the excessive gambling by the most vulnerable population groups. Therefore the company aims at protecting and supporting the most vulnerable Consumers. For this reason, it has already designed and created several voluntary activities to spread a responsible gaming culture in terms of communication, information and training, in collaboration with the Sectoral Associations and with the support of Companies that are specialised in the treatment and rehabilitation of people with psychological dependence problems. In addition to voluntary activities, HBG Gaming completed the actions envisaged in the Balduzzi Decree within the deadlines indicated herein, such as provision of billboards, labels and information documents for the gaming industry on responsible gaming; moreover, information leaflets have been handed out, containing information on how to fight pathological gambling and a self-assessment test, making the specialised care centres available at the same time. Protection of minors The protection of minors is one of HBG main commitments, implemented through control activities and the Prohibited to anyone under 18 label in its own Bingo rooms, betting rooms and the business partners rooms. Moreover the label is on each product advertisements, on the information material and on the company web site.

76 LEGAL AND RESPONSIBLE Gaming 074 HBG Gaming provides legal, safe and regulated gaming to subjects who autonomously and responsibly decided to spend some time in a type of entertainment, gaming, that may also entail cash winnings. HBG Gaming, licensed by the State, fights against illegal gaming, promotes a market that is becoming more and more transparent in offering completely reliable services and is in favour of controlled and safe gaming environments. Since 2012 HBG Gaming has activated the Responsible Gaming Project aimed at promoting a clear and thorough communication on gaming to encourage informed choices, informing about the risks of excessive gambling and paying special attention to the most vulnerable categories due to age and social position. HBG Gaming devotes a progressive and constant effort to this project, implemented in the different activities related to the following areas of intervention: Guaranteeing the prohibition to minors, always and everywhere Promoting responsible gaming Preventing excessive gambling behaviours Communicating, informing and providing support to the Final Consumer Play with your head is the slogan with which HBG Gaming reminds that entertainment is exclusively an amusement opportunity and it must not degenerate.

77 075 To further confirm HBG Gaming commitment in the promotion of legal and responsible gaming and in the prevention of pathological gambling, many activities have already been implemented and some others have been planned or will be implemented in the future. The most important activities are reported hereunder, through the description of the areas of intervention and the Partners with whom they have been implemented. about the technical contents and the dynamics of the different games. A conscious player who is well-informed on the chances of winning and loosing is certainly less exposed to the risk of excessive gambling. The company is promoting initiatives, in agreement with ADM, that are aimed at implementing interventions in favour of responsible gaming and protecting from access to gaming. To date, HBG Gaming, together with the other licencees, encourages legal Collaboration with the associations The participation of sectoral Associations represents a point of strength in the promotion of legal, regulated, innovative and responsible gaming, within a project that includes all the main players in the italian gaming market. HBG Gaming collaborates with the Sectoral Associations, in particular Ascob and ACADI, in promoting many initiatives such as events, conferences for market operators supporting a responsible approach to gaming, believing that the only method to tackle the risks of pathological gambling is informing the player in an unbiased and correct way and responsible gaming and directly participates in the search for solutions through dialogue with the Institutions concerning the problems related to illegal gaming and the serious consequences that it can produce in terms of organised crime, loss of revenue for the State and loss of employment. Staff training (employees) HBG Gaming promotes a responsible gaming culture also within the company and built a long-lasting dialogue with its own employees on these issues. In order to spread knowledge and raise awareness among the staff, in particular those with more direct contact with the public, HBG Gaming provided a workshop titled The rules of the game that involved the Bingo rooms Managers and part of the head office employees.

78 076 During the training, the issues of excessive gambling and their incidence have been dealt with, in addition to theoretical aspects of the types of players and the information on the evolution of the legislation. Moreover, some tools for the development of personal and professional skills aimed at identifying problematic players have been provided, in addition to first aid methodologies to fight excessive gambling through the support of specialised centres. The course was organised by S.I.I.Pa.C. (Italian Society for the Intervention against Compulsive Disorders), with teacher Cesare Guerreschi, journalist, psychologist and psychotherapist, founder and creator of the Therapeutic Community against pathological gambling. The Italian Society for the Intervention against Compulsive Disorders (S.I.I.Pa.C.) is a specialised centre for the treatment and rehabilitation of people with psychological dependence problems and compulsive disorders. Created in 1999, it was the first centre in Italy aimed at studying and analysing the phenomenon of pathological gambling in order to offer an effective intervention not only to the affected subjects but also to their families. At the moment it is provided with an innovative Rehabilitation Centre both in terms of therapies and for the variety of the professionals involved: Psychologists, Psychotherapists, Psychiatrists, Accountants, Lawyers, Tutors. Involvement of the network The strong link between HBG Gaming and its own Business Partners becomes a point of strength also in spreading a culture based on the promotion of responsible gaming. Within the business partners portal, the company provides all the material on responsible gaming and communication material aimed at protecting minors and the related prohibition to access Gambling. Business partners e-learning course Particular attention has been paid to the implementation of an on-line e-learning course titled Pathology in Gaming, addressed to the Business Partners. On their portal, a letter with the modalities to access the e-learning platform and an information manual have been published. The course was organised in collaboration with Articolo 1, a company providing services for Human Resources. Lecturer: the psychotherapist Maria Cristina Perilli. The training modules deal with the gaming topic and its pathologies in

79 077 all of its facets. Starting from an historical gaming analysis and the elements leading to create addiction in gamblers, with clinical data and figures, the latter are divided into typologies and lessons on the factors that may affect the development of addictions and pathologies are carried out along with clinical evidence on this illness. Then, important suggestions are provided on what to do in case of pathological gambling. At the end of each module, tests and exercises are taken along with a final learning examination. Participants are helped by a tutor helping them in managing their training, answering questions and guaranteeing a continuous monitoring of activities. At the end of the course a participation certificate is given. The course aims at raising awareness among HBG Gaming Business Partners and spreading a culture of care with regards to pathological gambling, moreover, it aims at providing necessary tools for managers and room staff to facilitate the access of the gambler with problems to helplines, associations and public and private structures able to help and assist. Publication on Pathological Gambling for managers and operators HBG Gaming, in cooperation with Mrs. Florinda Maione, psychologist and psychotherapist, manager the S.I.I.Pa.C. office in Rome, is writing a book on pathological gambling and intends to share it with managers and operators. The book aims at conveying information in a simple and effective way, with the use of comics and easy-to-read simplified contents. This initiative will allow for a better knowledge of useful information to fight against pathological Gambling and will raise awareness on the responsible gaming culture. The book will be also downloadable from the HBG Gaming website.

80 078 Communication and information initiatives HBG Gaming has launched several communication and information initiatives inviting to play responsibly and only in the venues authorized by the Customs and Monopolies Agency, as well as initiatives for the protection of responsible gaming. Different kinds of information materials were created, such as stickers to put on New Slots and Videolotteries plates, stating the prohibition to game for minors of age and inviting people to play with moderation. Inside HBG Gaming rooms, flyers reporting useful information on the main symptoms of gaming addiction, information on structures and therapies and the gamblers and family members helpline number are handed out. The flyer is produced by S.I.I.Pa.C. (Italian Society for the Intervention Against Compulsive Disorders) during the social campaign In gioco ci sei tu (You are at stake) against pathological Gambling, a campaign sponsored by HBG Gaming. Player s awareness In order to raise awareness among players towards a healthy and balanced approach, HBG Gaming, in its rooms, hands out flyers with a player s self assessment test designed by South Oaks Gambling Screen, aimed at detecting pathological gamblers. Even if such a diagnosis can only be made by an expert psychotherapist, this test can however provide a useful indication on the potential presence of gambling problems. The flyer contains information on the S.I.I.Pa.C. helpline to be called if the final score of the self assessment tells the need to contact a specialist for further analysis. The test is also made available online on the HBG Gaming website where there is a section fully dedicated to responsible gaming. In this section, people can also download provisions of law and Regulations on Bingo, New Slots and Videolotteries, as well as getting to know what are the winning odds. Moreover, some suggestions to maintain a responsible attitude towards gaming are provided.

81 079 PLAY WITH MODERATION Dreaming of winning by testing luck at gaming is an amusing activity which does not imply any risk, as long as there is a clear awareness on the real winning odds. As a matter of facts, gaming might degenerate and lead to compulsive behaviours until turning into a real disorder: this is why it is always necessary to play without exaggerations. We, as everybody does, understand what are the threats of gaming and nobody is interested into leading players into trouble. As Government Licensee it is our duty, and it is ethical to provide any useful information to prevent gaming addiction and to promote a responsible gaming culture. The games for which HBG Gaming is licensed are forbidden to people under 18 years of age, have money prizes and may become addictive. Play with moderation.

82 080 Prevention and limiting mechanisms in remote gaming HBG Games, in its Smartgames. it website, provides access to an advanced and reliable gaming platform, guaranteeing high security standards and the compliance with the law and the requirements set forth by the Government Monopolies. Starting from the introduction of remote skill games with money prizes and during the broadening of the offer of games in recent years, the Customs and Monopolies Agency designed strict regulations aiming, first of all, at the player s protection. Assistance to pathological gamblers Helping troubled gamblers is one of the values in our mission and because HBG Gaming believes that values should be put into practice, the company constantly works for preventing and controlling pathological gambling phenomena helping the association able to provide and action plan for people affected by this pathology and their family members. For this reason, in 2014 HBG Gaming took a factual commitment, providing an economic support to the Italian Society for the Intervention against Compulsive Disorders (S.I.I.Pa.C.) with a donation. Thanks to the HBG Gaming donation, S.I.I.Pa.C. implemented an innovative and totally anonymous on-line chat at this URL were people can contact a specialist in pathological gambling able to provide the assistance needed by those who are asking for help. HBG Gaming actively promotes safe and responsible gaming also in remote gaming, hence, in the smartgames.it website, players can find useful information to get to know gaming self-limitation tools, temporary or permanent self-ban from gaming, as well as a list of 10 rules to enjoy the gaming experience in awareness and responsibility.