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The 16.9% decrease in net sales recorded by INTERSPORT Polska S.A. in the third quarter of 2017 was due, primarily, to an over 25% decrease of the stocks level (mainly own labels) and the decrease of the trading area by 11.6% on year to year basis.

In the third quarter of 2017, INTERSPORT Polska S.A. network recorded total net sales of PLN 42,220 thousand. i.e. 16.9% less than in the same period of the previous year (previously: PLN 50,810 thousand) - on the basis of comparable stores (in LFL approach), y/y sale was lower by 10.9% whereas the Company reduced the commercial area by 11.6%.

In the third quarter of 2017, the Company recorded a gross loss of PLN 4,037 thousand whereas in the third quarter of 2016, the gross loss amounted to PLN 689 thousand. The level of recorded losses in the third quarter of 2017 was mainly affected by: lower by PLN 8,590 thousand revenues on sales y / y and the onetime costs incurred by the Company in connection with the closure of two stores. In the third quarter of 2017, the Company decreased operating expenses by 8.7%, i.e. PLN 1,811 thousand y / y.

Since 24 March 2017 the Company has hold the independent INTERSPORT license and from then on it started to implement the "New Business Model". In this system the high-margin own labels of INTERSPORT will be ordered directly from manufacturers. The process is assumed to last from six to nine months to accomplish.

Accordingly, the effects of the implementation of phase I of the "New Business Model" became noticeable in INTERSPORT stores only since 28 September, after the first deliveries under the new conditions, supplementing the missing stocks and initiating a marketing and information campaign. The Management expects that the actions taken will bring the improvement of sales results in the coming months, and the full effect of the changes will be seen in the second phase of the process, planned for the spring of 2018, when
the supply of INTERSPORT's own labels under the new conditions will have been implemented in full.

Cumulatively, after the first three quarters of 2017, the Company has recorded net sales of PLN 132,856 thousand. i.e. by 16.0% lower compared to the corresponding period of 2016 (previously: PLN 158.080thousand), decreased the cost of operations by 6.3% (used to be: PLN 62,512 thousand, currently is: PLN 58,572 thousand) and recorded a gross loss of PLN 7,497 thousand (previously: gross loss of PLN 1,144 thousand)