(For ease of writing and explanation this piece directly uses parts of the Dynasty Trust Quarterly Report #2 of June 2023 which features the Bolloré galaxy and was penned by the author. Please note there are significant estimates, friction costs and assumptions in this piece which we may not have correctly captured so this is more than usual E&OE)

The real Normandy D-Day was 82years and 16days ago but for some proud adjacent Bretons along the Odet River, 23 June 2026 is a pretty big day. Its the ex-dividend day (pay day is 25th) for the €1.50/share special dividend payable by Bolloré to disgorge €4.2billion of the proceeds of the 2022 sale of African Logistics (€5.7bn to MSC in December 2022) and European Logistics sale to (€4.9bn to CMA CGM) in February 2024. Bolloré hasn’t been able to find a business suitable for investing significant amounts of its €5.6billion cash pile, and seemingly under pressure from some long standing shareholders has opted to pay out three-quarters of its cash hoard.

The Bolloré self-control loop (Breton Pulleys) established in the 1980’s under the advice of Lazard’s Antoine Bernheim originally used ultra-wealthy families as the “upward rope” - see the structure in September 1988:

The effective acquisition of “Rivaud Group” in 1996 enabled the gradual replacement with companies directly under Bolloré control.

“Rivaud group” was founded by four brothers – Olivier, Max, Maurice and Rene Rivaud de Raffiniere - in the early part of the twentieth century building and funding rubber and palm oil plantations in the Far East and Africa. The Rivaud’s acquired Socfin (Société Financière des Caoutchoucs “Financial Rubber Company”) in 1919 but Rivaud Group evolved around a bank – Banque Rivaud et Cie – which under Olivier Rivaud de Raffinière’s son-in-law, Jean de Beaumont, developed significant connections with the RPR (Rassemblement pour la Republique – the Gaullist party). His son in law – Edouard de Ribes – chaired the bank from 1975 onwards. The group had listed a number of tightly held companies effectively representing individual country plantation holdings, with two over-riding listed holding companies, Socfin and Plantations des Terres Rouges, and the unlisted Société Bourdelaise Africain (SBA). All up, Rivaud contained some 800 companies and 130 often inter-locked holding companies by the late 1980’s. The initial connection with Bolloré was between Count de Ribes and Michel Bolloré, Vincent’s father. In 1989 (just after the diagram above) as part of the financing of the “upper” part of Bolloré, the group’s exchanged 30% shareholdings in SBA and Financière V.

Bolloré control of Rivaud came about from two “scandals”:

• the 1990 attempt by two Italian financiers Giancarlo Parretti and Florio Fiorini to acquire the French Pathé cinema chain with the assistance of Rivaud which facilitated the acquisition of 37% of Plantations des Terre Rouges (PTR) to add to their existing 40% holding of Socfin. Both Italians were eventually arrested on fraud charges relating to the takeover of MGMUA and their shareholdings were sold in September 1990 to a 60/40 Bolloré/ Credit Lyonnais vehicle (Glenans); and

• the summer of 1996 when the Rivaud controlled Air Liberté went bankrupt, tax agents raided Rivaud HQ and the French Banking Commission commenced an investigation into Banque Rivaud.

Consequently, Vincent Bolloré became President of the main holding companies and a year later bought Comte de Ribes shareholding in SBA to give Bolloré effective full control. Here’s the structure just before then in early 1997:

Thirty or so years on, this structure has morphed into that which exists today with Bolloré itself (illustrated in blue boxes) and its >97% owned Rivaud companies (illustrated in the RED boxes) controlling the upward pulley whilst the downward rope is a simple ~50% of ~50% cascade structure to self control the Bolloré galaxy:

The combination of Rivaud and the French mother-daughter tax structure, whereby inter alia dividends paid to companies owning over 5% of the dividend payer are effectively taxed at only 5% is essential to the repatriation of up to €1.5billion (on our estimates) of the €4.2billion paid out back to Bolloré - 35%. Bolloré will receive back some 49% of Odet’s likely dividend to be declared in the September quarter.

Odet: confirming the basis of repatriation

At the AGM of Odet last week, management confirmed that a significant percentage of the exceptional dividend received would be distributed. There are suggestions of up to a €2.5billion payout (which would be 83% of that received versus prior indications of “at least two-thirds”). Let’s work with an estimate of 75% which would imply Odet payout ~€2.25billion of their €2.995billion received.

€2.25billion equates to a dividend per Odet share (6.568million) of €340/share. There is no known debt within the cascade structure enabling streaming all the way up to the ultimate controller, Bolloré Participations, assuming 5% tax:

We assume each of the cascading companies fully pays out their proportional share of the dividend.

What do the Rivaud companies collect?

There are three main listed Rivaud companies with a combined public float priced at €275million, Artois (€101mn), Moncey (€102mn) and Cambodge (€72mn).

Artois garners dividends from three sources - its 5.6% (370,807 shares) of Odet, 5% of Financière V but importantly a “fourth derivative” highlighted in green on the chart: its 22.8% of unlisted Plantations des Terres Rouges (PTR) which derives its payout from Cambodge and Moncey, which of course, forces an iterative calculation. We estimate it will receive around €495million from these sources (shown below). If PTR does NOT payout its dividend receipts, then that will have a direct impact on Bolloré. So, in our view, it will.

In total we figure Artois will receive €120million direct from Odet, €29million from Financière V and €107million from PTR totalling €256million or €962 per Artois share.

Moncey derives dividends (estimates in brackets) from:

1. 324,535 direct shares in Odet (€110million);

2. 12.18% of Financière V (€74million);

3. 17.1% of Omnium Bollore (€52million); and

4. 42.05% of Artois (€108million).

This totals €344million or €18.49/Moncey share.

Cambodge derives an estimated €856million or €14.10 per CBDG share in Odet dividends from FIVE sources:

1. 1,259,663 direct shares in Odet (€428million);

2. 23.26% of Financière V (€142million);

3. 64.74% of Moncey (€223million);

4. 8.96% of Artois (€13million); and

5. 10% of PTR (€50million)

How does this feed back up to Bolloré?

The importance of PTR in receiving its fifth level dividends from Cambodge and Moncey becomes clear when we estimate the breakdown of receipts to be received back by Bolloré, which garners distributions from SIX sources calculated as follows:

1. 35% of Sofibol owned by Bolloré (€428million);

2. 13% of Sofibol owned by 100% subsidiary Compagnie Saint Gabriel (€155million);

3. 32.7% of Omnium Bolloré (€199million);

4. 34.6% of Cambodge (€296million);

5. 15% of Moncey (€52million); and

6. 67.2% direct of PTR (€333million)

In total, these amount to €1,463million or just under 49% of the dividend received before tax by Odet from Bolloré. Net of 5% tax, this would equate to just under €1.4billion or €0.50 per Bolloré share.

The Implications

For Odet they will return to a net cash position on a “parent” basis after retention of ~€760million. Indications from the AGM are that Odet will remain listed, despite the mere 7.9% (priced at €788million) public float but will focus on acquisitions of securities within the Bolloré galaxy as has been the case in recent months (eg acquisition of Havas in a JV with Bolloré) and apparently stock in Canal+.

For Bolloré the company will still have €1.4billion of net cash (€0.50/share) before any receipt of “flow-back” dividends via an Odet declaration and subsequent payouts as calculated; our estimates suggest this will roughly double if the up and downstream payouts are as suggested. In turn, with >€2.15/non SCL adjusted share in UMG, €0.95 in direct ex-Vivendi businesses, and €1/share in cash on an ex-dividend basis, a theoretical XD price of €4 is underpinned before adjusting the capital base or ascribing the massive requisite value to the self-control loop. (I’ve kept it simple for a change). We do acknowledge the ongoing legal issues surrounding the Vivendi split and gun-jumping allegations.

The Bolloré structure and its specific use in France is ridiculously under-estimated and undervalued by many global investors. Spending a little time understanding the brilliance of this dividend strategy for the group should persuade you to have a closer look. Hopefully this piece serves as an amuse bouche.

Andrew Brown

22 June 2026

_{This disclaimer applies to this document and the verbal or written comments of any person presenting it. The document taken together with any such verbal or written comments, is referred to herein as the “Presentation.”}

_{This Presentation of general background information about Bolloré SE and Compagnie de L’Odet and related entities is current at the date of the Presentation. The information contained in this Presentation is of general background and does not purport to be complete.}

_{The Presentation relates to Bolloré SE and Compagnie de L’Odet and related entities but is not an offer to purchase or sell securities. The Presentation does not constitute an offer to sell, or a solicitation of an offer to buy, any security and may not be relied upon in connection with the purchase or sale of any security. Any such offer would only be made by means of formal offering documents, the terms of which would govern in all respects. You are cautioned against using this information as the basis for making a decision to purchase any security mentioned within the Presentation. Andrew Brown is the sole Director of East 72 Management Pty Limited (ACN 663980541) which is Corporate Authorised Representative 001300340 of Westferry Operations Pty Limited (ABN 48 103 724 072) (AFSL 302802). Andrew Brown, the sole Director of East 72 Management Pty Limited is the Responsible Manager for Westferry Operations Pty Limited. The information contained in this Presentation is of general background and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice, when deciding if an investment is appropriate.}

_{Andrew Brown, Westferry Operations Pty Limited, East 72 Management Pty Limited and its related bodies corporate and any of their respective officers, directors and employees (“Brown Parties”), do not warrant the accuracy or reliability of this information, and disclaim any responsibility and liability flowing from the use of this information by any party. To the maximum extent permitted by law, the Brown Parties do not accept any liability to any person, organisation or entity for any loss or damage suffered as a result of reliance on this document.}

_{Forward Looking Statements}

_{This document contains certain forward looking statements and comments about future events. Forward looking statements can generally be identified by the use of forward looking words such as, ‘expect’, ‘anticipate’, ‘likely’, ‘intend’, ‘should’, ‘could’, ‘may’, ‘predict’, ‘plan’, ‘propose’, ‘will’, ‘believe’, ‘forecast’, ‘estimate’, ‘target’ and other similar expressions within the meaning of securities laws of applicable jurisdictions. Indications of, and guidance on, future earnings or financial position or performance are also forward looking statements.. Forward looking statements involve inherent risks and uncertainties, both general and specific, and there is a risk that such predictions, forecasts, projections and other forward looking statements will not be achieved. Forward looking statements are provided as a general guide only, and should not be relied on as an indication or guarantee of future performance. Forward looking statements involve known and unknown risks, uncertainty and other factors which can cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward looking statements and many of these factors are outside the control of Brown Parties. As such, undue reliance should not be placed on any forward looking statement.}

_{Past performance is not necessarily a guide to future performance and no representation or warranty is made by any person as to the likelihood of achievement or reasonableness of any forward looking statements, forecast financial information or other forecast. Nothing contained in this Presentation nor any information made available to you is, or shall be relied upon as, a promise, representation, warranty or guarantee as to the past, present or the future performance securities mentioned herein.}

_{The information in the Presentation is provided to you as of the dates indicated, and Brown Parties do not intend to update the information after its distribution, even in the event that the information becomes materially inaccurate. Certain information contained in the Presentation includes calculations or figures that have been prepared internally and have not been audited or verified by a third party.}

There are seven sell side analysts for VIRT. Five of them work for firms who compete directly with Virtu in the alternative trading systems (ATS) market which transacts roughly one-seventh of US equities as a combined venue. The five are the big “bulge-bracket” firms (JPM, Goldman, Morgan Stanley, UBS and BoA. The remaining two have a long standing relationship with Virtu in different ways: Jefferies - heavily involved in the recuperation and eventual sale of Knight Capital Group and Piper Sandler where the broker has regularly profiled Virtu at its corporate events. Of course, they ask the first question on analyst calls¹.

One of the delights of covering and owning companies involved in the securities industry is that research coverage of them is generally poor. In the author’s opinion, really poor. Competitor management don’t want the research analyst spending precious time and effort on them, the perception being that there is no investment banking business available other than bond issuance. Virtu and US markets are not unique; its the same around the world even in Australia where two listed direct securities industry participants - Euroz Hartleys and Bell Financial Group - routinely trade at mid-single digit P/E’s. No competitor brokers cover the shares. They usually exhibit strong “beta” - especially to corporate activity within certain areas of Australia’s equity market. Many pay generous dividends to supplement the principals’ remuneration, but pay is often “constrained’ - it’s public and people like me turn up at AGM’s with awkward questions.

On 19 March 2026, I presented VIRT at Value Spain in Madrid with the prior night’s closing price of $39.88. The presentation focused on the changing dynamics of US equity markets, the high volumes (and volatility) of Q1 2026 at the time, the beneficial commitment by Virtu of greater capital to trading rather than buy-backs and the assessment that near term earnings estimates by the sell-side were pitifully inaccurate - with one exception. We posited that quarterly earnings for Q1 should exceed $2/share on a normalised basis against a consensus estimate at the time of $1.25. We wrote up the presentation at Dynasty Trust 31 March 2026

As it happened, Q1 EPS was $2.24 - in fairness, the sell side revised up their numbers in the days preceding the report to an average $1.65. Still ridiculous! Why would the bulge bracket firms expend ANY effort other than to get competitive infomation? It was clear to anyone observing US equity markets that conditions for participants who require volumes (and volatility) in Q1 were the best ever so how could a market maker earn 11% less than the preceding quarter - especially with more committed capital??

So its clear that sell side research on the company is “compromised” in some way. That’s to our benefit. There’s a clear information gap.

Since 18 March 2026, Virtu shares have advanced to $63.07 and with the quarterly dividend have returned nearly 59% in three months.

This piece is NOT self-congratulation. It’s about questioning whether there is still value in the shares but also to note that during this time, in the dynamic world of US securities trading, much has happened. So, we focus briefly on two aspects:

• has the environment for Virtu changed in Q2 2026; and

• the rapidly evolving regulatory framework

The current environment for Virtu

^{(all statistics in this piece are sourced from Virtu (historic) and CBOE (current quarter)}

Virtu’s lifeblood is volume, preferably with added volatility. In Q1 2026, average daily volumes across the 63day period were 19.985billion shares with S&P500 realised volatility averaging 14.4% - way below the predicted VIX implied volatility average of 20.4% in that period of significant geo-political events. It’s best for Virtu if more volume is done via the trade reporting facility (TRF) i.e. off exchange in an environment dominated by Citadel, Virtu and Jane Street. In Q1, TRF averaged 48% of share volumes.

In the 55 trading days of Q2 2026 to date, average daily volume is 19.3billion shares, with an estimated 48.8% via the TRF (split 3-1 OTC versus ATS) and estimated (but fluctuating) 30days realised volatility of 14.5% from end April - about 400bp below equivalent predictive VIX, having spiked down from a significant prior premium to VIX in the month of April (remember its a historic backward looking indicator). So, the environment for Q2 todate is less than 4% weaker volume wise than Q1 with equivalent volatility.

Moreover, the first 14 (of 21) trading days of June have been astonishing, with average daily US stock volumes of 22.774billion shares a day worth an average $1.26trillion daily.

Hence, it would be surprising, if Virtu didn’t come close to replicating its Q1 earnings based on factors at work in its largest market - US equities.

Not that these competitor sell side analysts would suggest that. Despite some recent upticks in estimates, the current quarter average sits at $1.49/share - one third below Q1; we would have thought a number closer to $2 (again) intuitively makes more sense. We postulated in Madrid that the company should earn $6.50 a share for 2026; even if the prevailing environment slows up a bit in H2, we reckon $7.70ish now looks more reasonable.

Virtu will never trade at a significant multiple for reasons examined in the March quarter Dynasty Trust report - in one sense Virtu is a commodity price taker - volume and volatility on top of a fixed cost base. Hence, other than at cyclical low points, anything above low double digit P/E multiples are unlikely to be sustained for any length of time. But given the obvious barriers to entry to the business, are P/E’s of ~8x reasonable either, even in buoyant environments?

That clearly depends on your view of the structural opportunities open to businesses like these. That’s where the last three months have been of serious interest.

A changing regulatory framework: believing the HYPE?

VIRT stock’s strong total return over the past three months (18 March to 19 June) sharply contrasts with the situation for the exchange venues: CME has fallen from $309 to $246 (-19.8% total return after dividend); CBOE from $287 to $249 (-13%) and ICE from $157 to $134 (-14%) with S&P500 +13.2% over the same period.

So the venues have been hit hard whilst the partipants have soared. On 29 May the Commodity Futures Trading Commission (CFTC) approved a perpetual bitcoin contract issued by Kalshi, the $22bn valued prediction market comany. As is presently the case elsewhere in equity markets, new “technological” initiatives in one arena are assumed to be instantly successful across the board and eliminate existing “legacy” businesses in short order. See your software holdings. Hence, the sharp negative reaction in the “venue” stocks.

Perpetual futures (“perps”) are different to contracts for difference (CFD’s) which also have no expiration date and offer significant leverage - with a much larger current offering through operators such as IG Markets Group (IGG.LN). The attraction of perps is that they are peer-to-peer traded on an exchange rather than being an over the counter contract with pricing set by a market maker and hence (arguably) have less counterparty risk (remember MF Global?).

Currently, the largest participant venue for perps is Hyperliquid (HYPE) which trades as a token with a market capitalisation of ~$18billion and through a couple of ETF’s. HYPE offers perps on a variety of indices and commodities. Of course, Kalshi will be into this as well, now CFTC have “acceded”.

CFTC may have acceded, but the venues certainly have not. On 18 June CME Group sued CFTC to block the ruling effectively arguing perps were swaps. Wall St Journal 18 June 26 For the likes of Virtu, it’s just another peer-to-peer market with potential retail participation, facilitating the use of their market making skills. And of course, the transfer of IG’s skills and distribution: their London-listed shares are up 41% in three months.

The author figures that perps will happen sooner or later, perhaps with guardrails. Given that CFD’s are banned in the US, despite the counterparty differences, they represent an obvious substitute. They will require participant “market-makers” to hedge, creating yet more volume in the underlying securities and assets. All grist to the mill.

The mere creation, legal consideration and widening of perps continues the trend of market democratisation which underpins players with distribution networks (IBKR stock +40% since 18 March, HOOD up 44% and even Goldman +37%). Perhaps these moves are overly excitable; but for the “pick and shovel” provider, like Virtu, who can mine a little gold on the side, still on a single digit P/E of our estimated 2026 earnings, who’s to say there is not more to come.

Not that the sell-side brokers (bar one or two) will be telling you.

Andrew Brown

20 June 2026

^{1: “Great result Aaron”}

_{This disclaimer applies to this document and the verbal or written comments of any person presenting it. The document taken together with any such verbal or written comments, is referred to herein as the “Presentation.”}

_{This Presentation of general background information about Virtu Financial is current at the date of the Presentation. The information contained in this Presentation is of general background and does not purport to be complete.}

_{The Presentation relates to Virtu Financial but is not an offer to purchase or sell securities. The Presentation does not constitute an offer to sell, or a solicitation of an offer to buy, any security and may not be relied upon in connection with the purchase or sale of any security. Any such offer would only be made by means of formal offering documents, the terms of which would govern in all respects. You are cautioned against using this information as the basis for making a decision to purchase any security mentioned within the Presentation. Andrew Brown is the sole Directors of East 72 Management Pty Limited (ACN 663980541) which is Corporate Authorised Representative 001300340 of Westferry Operations Pty Limited (ABN 48 103 724 072) (AFSL 302802). Andrew Brown, the sole Director of East 72 Management Pty Limited is the Responsible Manager for Westferry Operations Pty Limited. The information contained in this Presentation is of general background and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice, when deciding if an investment is appropriate.}

_{Andrew Brown, Westferry Operations Pty Limited, East 72 Management Pty Limited and its related bodies corporate and any of their respective officers, directors and employees (“Brown Parties”), do not warrant the accuracy or reliability of this information, and disclaim any responsibility and liability flowing from the use of this information by any party. To the maximum extent permitted by law, the Brown Parties do not accept any liability to any person, organisation or entity for any loss or damage suffered as a result of reliance on this document.}

_{Forward Looking Statements}

_{This document contains certain forward looking statements and comments about future events. Forward looking statements can generally be identified by the use of forward looking words such as, ‘expect’, ‘anticipate’, ‘likely’, ‘intend’, ‘should’, ‘could’, ‘may’, ‘predict’, ‘plan’, ‘propose’, ‘will’, ‘believe’, ‘forecast’, ‘estimate’, ‘target’ and other similar expressions within the meaning of securities laws of applicable jurisdictions. Indications of, and guidance on, future earnings or financial position or performance are also forward looking statements.. Forward looking statements involve inherent risks and uncertainties, both general and specific, and there is a risk that such predictions, forecasts, projections and other forward looking statements will not be achieved. Forward looking statements are provided as a general guide only, and should not be relied on as an indication or guarantee of future performance. Forward looking statements involve known and unknown risks, uncertainty and other factors which can cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward looking statements and many of these factors are outside the control of Brown Parties. As such, undue reliance should not be placed on any forward looking statement.}

_{Past performance is not necessarily a guide to future performance and no representation or warranty is made by any person as to the likelihood of achievement or reasonableness of any forward looking statements, forecast financial information or other forecast. Nothing contained in this Presentation nor any information made available to you is, or shall be relied upon as, a promise, representation, warranty or guarantee as to the past, present or the future performance securities mentioned herein.}

_{The information in the Presentation is provided to you as of the dates indicated, and Brown Parties do not intend to update the information after its distribution, even in the event that the information becomes materially inaccurate. Certain information contained in the Presentation includes calculations or figures that have been prepared internally and have not been audited or verified by a third party.}

Mostly, such strategy is counter-cyclical. Buy low when companies and businesses are out of fashion. Investors profess to admire contrarian investors - but seem to get scared whilst they are executing the very transactions that create such value. There’s usually no easy way to evaluate such companies. In my view, it’s all about how they grow a measure of net asset value, often derived from multiples and free cash flows of operating earnings added to spot asset values of properties and securities.

What follows is just a taster of one such entity which will not report its full year results for the year ending April 2026 until mid July. I am happy to privately estimate the dramatic changes in balance sheet in the six months since the interim numbers (October 2025) but to go public is too risky. There are notable property transactions with no disclosure of price paid, and cash flow can depend on major inventory swings in a £5bn+ retail business (look at the last two years).

Frasers Group PLC (FRAS.LN) is 73% controlled by Mike Ashley, who famously left school at 16 to open his first store in 1982, has occasionally enjoyed a beverage (or many) in a public house (google it), owned Newcastle United FC for 14 years - disappointing the Geordie faithful by not being stupid with money and seemingly falling out with icons such as Kevin Keegan and Alan Shearer - before delighting them by selling to the Saudi PIF. He is no longer on the Frasers board but no doubt occasionally has dinner with his son-in-law Michael Murray, the CEO of Frasers.

The company IPO’d as Sports Direct International in London in 2007 at £3 a share with Ashley taking 410million of the then 720mn shares as vendor consideration for the sports retailing and brand owning business. Within six months, SDI was buying back shares on market at less than half the float price. Equity retirement has been a key strategy of the group over its nineteen year public company history with issued capital whittled down from 720million shares to ~448million excluding Treasury stock but including 17mn Employee trust shares.

SDI became Frasers in 2019 (borrowing the storied-heritage of House of Fraser, the former owner of Harrods) which it bought out of administration. Frasers has continued to develop a nine pronged strategy underpinned by technology and cross-fertilisation in pursuit of builing “the planet’s most admired and compelling brand ecosystem” :

• UK Sports retail (including brands and gyms) - 791 SDI and fitness stores turning over ~ £2.7billion at 48% gross margin - the largest in the UK;

• UK Premium Lifestyle - 139 stores with turnover of ~£900mn at just under 40% gross margin under (amongst others) the Flannels, Jack Wills and House of Fraser brands;

• International with £1.5bn turnover at 45% gross margin in 537 stores across Belgium, Irealnd, Estonia, USA, Malaysia and Africa with partnerships in the Middle East, inlcuding last year’s takeover of Norwegian listed XXL ASA;

• Property owner-occupation: High Street type stores occupied by the company’s own business - rental not disclosed;

• Property investment (effectively for third parties): significant new investment over H2 FY2026 (to April) in UK shopping centres (Braehead, Glasgow for £218mn, and three designer centres/outlets in Swindon, York and Mansfield). Braehead alone is a 15million annual footfall mall;

• Financial services - effectively lending to support the business own sales with assistance from digitsation;

• Brand affiliation and partnership with key global brands given the footprint offered by the three retail exposures;

• significant shareholdings in publicly listed retailers, not always on a friendly basis; and

• Brand ownership.

FY2026 to April pre tax profit at the mid point has been guided by the company to £575million from retail and property investment. This is the key profit measure as reported profit includes significant mark to market movements on the securities porfolio.

Brand ownership and partnership

If there’s a UK brand in the broad “leisure” business that you remember and still see around but have no idea who owns it, if you guess “Frasers” you’ll probably be right. Starting in 1996 with the tennis racket company “Donnay”, Frasers now own icons such as Lonsdale (2002), Slazenger, Dunlop (2004), Karrimor (2004), Everlast (2007), Sondico (2012) and Gieves and Hawkes (2022).

The company has created its own brands (eg. Flannels) but also has significant distribution agreements with major global sporting brands and “partnerships” with Nike, New Balance, Puma and Under Armour amongst others.

Property and accounting

To the untrained analyst, Frasers is a nightmare. The company owns £900million at cost of freehold and long lease property within its retail business, where rental falls out on consolidation, leaving only genuine shorter lease properties subject to IFRS 16 rental disclosure. However, the company depreciates the owned freehold buildings over a 15year period; together with long lease properties they are carried in the balance sheet at £478million against a cost value of £1,053million. Hence, to really capture profitability in the retail business requires this depreciatiion to be added back.

In addition, the company has been on a buying binge of investment properties which are NOT subject to the same accounting standard. Eleven shopping centres were acquired in the two years leading up to the last interim accouts, and carried in the books at £596million - a genuine reflection that many were acquired for around the £50million mark in provincial UK locations. (The author distinctly remembers being dragged around Frenchgate in Doncaster, Yorkshire as a kid when it was perceived as “posh”). We know that two of the four centres acquired in H2FY2026 cost ~£365million suggesting that investment in this asset class could now surpass £1billion and be twice the October figure. Based on the FY2025 accounts, gross rental yield at carrying value was ~8.7%

Shareholdings

Frasers has nine disclosed shareholdings of meaning, inlcuding the associate Hugo Boss where it has board representation and is now bidding for the company, in a seeming attempt to increase its shareholding, but not necessarily obtain 100%, in what appears to be an outwardly friendly move. Management’s disappointment with their antipodean counterparts at Accent Group has just provoked a hostile nil-premium bid with accompanying Frasers-style vitriol. (prices at 12 June 2026)

The backdrop

Many of my cohort have not been focused on spaceships, satellites and semis - but the most busted major global economy: the UK. Why would you buy retailers and retail properties in a country like this? Because it’s still the world’s fifth largest economy by nominal GDP (US$4.26trillion says IMF) with per capita GDP of US$61k. And with charts like this, retail assets and businesses might just be cheap:

GfK UK Consumer Confidence Index

Who would bother owning it and what might Frasers be worth?

Me! (and do so via Dynasty Trust).

Frasers has a different share register - aside from Mike Ashley’s 73% - with the top 15 shareholders including some smaller managers with strong valuation and fundamental bias - Lancaster Investment Management, Asset Value Investors, Phoenix Asset Management and Schroder amongst others. The company iself has run a respectable buy back hoovering up 2.6million shares (0.6%) since end October 2025 despite the aggressive spend on property moves - and now contingent outlay on two takeover bids this month.

We believe Frasers can be valued at around £13.30 per share (equity value £5.95billion) or a two-thirds premium to prevailing prices in its current form. This assumes an effective P/E of 11x (8.25x pre tax earnings) for the retail, brand and owner-occupied property business (£4.76billion before revaluation increment), shareholdings at market prices (£1.2billion), assumes no uplift in recent investment property acquisitions and adds back accumulated depreciation on in-use freeholds (>£600million) and deducts debt at end October 2025 (net £1.1billion). Effectively we are netting off the four recent investment property purchases against debt despite their significance.

The FY2026 results should be announced around mid July and as usual with businesses such as these, the interest is NOT in the EPS or profit number, but the myriad of detail enabling a more fulsome and updated testing of the valuation principles.

Andrew Brown

15 June 2026

Disclaimer

_{This disclaimer applies to this publication (“Presentation”) and the verbal or written comments of any person presenting it.}

_{This Presentation of general background information about Frasers Group PLC is current at the date of the Presentation. The information contained in this Presentation is of general background and does not purport to be complete.}

_{Unless otherwise noted, figures presented are unaudited and are current as at 12 June 2026. All share prices are as at 12 June 2026 or the date noted in the relevant slide. All values are in local currencies unless otherwise stated. All information is sourced from company reports, tikr.com for consensus estimates and compiled by the author}

_{The Presentation does not constitute an offer to sell, or a solicitation of an offer to buy, any security and may not be relied upon in connection with the purchase or sale of any security. Any such offer would only be made by means of formal offering documents, the terms of which would govern in all respects. You are cautioned against using this information as the basis for making a decision to purchase any security mentioned within the Presentation. Andrew Brown is the sole Director of East 72 Management Pty Limited (ACN 663980541) a Corporate Authorised Representative 001300340 of Westferry Operations Pty Limited (ABN 48 103 724 072) (AFSL 302802). Andrew Brown is the Responsible Manager for Westferry Operations Pty Limited. The information contained in this presentation is of general background and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice, when deciding if an investment is appropriate.}

_{Andrew Brown, Westferry Operations Pty Limited, East 72 Management Pty Limited and its related bodies corporate and any of their respective officers, directors and employees (“Brown Parties”), do not warrant the accuracy or reliability of this information, and disclaim any responsibility and liability flowing from the use of this information by any party. To the maximum extent permitted by law, the Brown Parties do not accept any liability to any person, organisation or entity for any loss or damage suffered as a result of reliance on this document.}

_{Forward Looking Statements}

_{This document contains certain forward looking statements and comments about future events. Forward looking statements can generally be identified by the use of forward looking words such as, ‘expect’, ‘anticipate’, ‘likely’, ‘intend’, ‘should’, ‘could’, ‘may’, ‘predict’, ‘plan’, ‘propose’, ‘will’, ‘believe’, ‘forecast’, ‘estimate’, ‘target’ and other similar expressions within the meaning of securities laws of applicable jurisdictions. Indications of, and guidance on, future earnings or financial position or performance are also forward looking statements.. Forward looking statements involve inherent risks and uncertainties, both general and specific, and there is a risk that such predictions, forecasts, projections and other forward looking statements will not be achieved. Forward looking statements are provided as a general guide only, and should not be relied on as an indication or guarantee of future performance. Forward looking statements involve known and unknown risks, uncertainty and other factors which can cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward looking statements and many of these factors are outside the control of Brown Parties. As such, undue reliance should not be placed on any forward looking statement.}

_{The information in the Presentation is provided to you as of the dates indicated, and Brown Parties ds not intend to update the information after its distribution, even in the event that the information becomes materially inaccurate. Certain information contained in the Presentation includes calculations or figures that have been prepared internally and have not been audited or verified by a third party.}

Of course, the family itself via the upper echelon companies of the cascading part of the self-control loop will be the main beneficiaries. But the real intrigue will be what Odet will do with its retained €1.2bn of the special dividend.

Since the legally problematic spin off of Vivendi’ s businesses of Canal+ (now merged with MultiChoice Group), Havas and the cumbersome Louis Hachette Group with its 67% listed subsidiary Lagardère, the Bolloré family have done little except defend the court argued allegation of controlling Vivendi prior to the spin. An allegation which is still not resolved - and may yet lead to the requirement for Bolloré to bid for Vivendi. However, what they have done is looked under the stairs and found an old toy box.

Since 31 December 2025, Odet and Bolloré used a 51/49 company, Compagnie de l’Etoile et des Mers (Company of the Stars and Seas) to hoover up 22% of Havas NV, the global ad agency listed in Netherlands, including the 3.5% held by its Chair, Yannick Bolloré. With the inherited ~30% from the spin, the family now control 53% of this slow growth entity.

In the past two weeks, Havas has been pressed into action to buy about 0.65% of Louis Hachette Group (ALHG) at a cost of about €10.7million - so money that would have otherwise be taken down the sweet shop. The suspicion is that with 53% of the register freely floating, some other obscure joint-venture entity involving Odet’s new piggy bank might get busy.

Remember: ALHG is listed on Euronext GROWTH so has a 50% takeover threshold - not 30%.

It’s interesting that the Bolloré family are buying at these prices around €1.75/share. ALHG is simple - there’s just the 86% of Prisma Media, valued at €184million (€214m x 86% after the 14% transfer to Vivendi) plus 93.935million shares of Lagardère (MMB) and a rough wash of other assets. The Bolloré’s and ALHG management seem to be the only people who think Prisma is worth anything at all. This means at current ALHG prices, the shares trade bang in line with the publicly traded price of the MMB stake.

Of course, if Bolloré wants to play in MMB, it’s very difficult given that the free float is a meagre 8.7% with Qatar’s holding of 11.5% and Vivendi 13.4%. It’s fair to say the 8.7% contains a few folks with (1) patience (2) a view that the shares are worth FAR FAR moe than the prevailing €18.64 apiece. Count me in that crowd.

Clearly MMB may be impacted a little by travel reluctance at present - its still a tiny bit early to discern global rather than regional trends since the Iranian situation escalated. MMB have publicly flagged a flat year in Lagardère publishing after an exceptional CY2025. But the company is a far cleaner, lower geared entity than 3 years ago - with a share price 15% LOWER than then. We’ll have more to say in due course.

Digging up the last Vivendi offer for MMB of €24/share would only cost €680million for the residual 20% if the minorities acquiesced. I’m not sure they would and there’s no point buying on market. So hoovering ALHG may be a way to capture value before the event.

Next Wednesday 17th French time at 11am its the Compagnie de L’Odet AGM. Wish my French was a little better to question this old toy box strategy. If equity markets hit a bumpy patch, the family are superbly positioned with cash a plenty (plus the UMG stake) to broaden their horizons. But with Vivendi still unresolved and so much value in the proximate companies, maybe it will be later in the year.

Final point: M. Bolloré loves summer holidays. Not his own. Yours. Because people go away, relax and take their eye off the ball which is when he gets busy. Add in the attractions of Mbappé and Olise this year and the distractions will be that much greater.

Andrew Brown

10 June 2026

The most recent missive from Pershing on 2 April 2026 https://x-shared.s3.us-east-1.amazonaws.com/New+UMG.pdf is full of one thing and missing another. Full of “adjusted EBITDA” and absent “free cash flow”.

Any business which produces royalty streams must be looked at in terms of free cash flow, because the SUPPOSED absence of capex gives you an outcome which can be evaluated at your level of desired return. My favourite royalty stock in the world - Deterra Royalties (an iron ore royalty over BHP’s Western Australian Mining Area C - was destroyed by a self-serving board and management team who decided to diversify and build a bureaucracy rather than just cash the cheque. Its stay in business capex was ZERO.

UMG is NOT that royalty. It has to keep investing to maintain the quality of its book, despite the massive benefits of back catalogues. So when Pershing focuses on adulterated EBITDA and compares with cohorts (margin) and other industries (valuation) it is quietly glossing over total €540million in 2025 of capex (2024: €450million) along with over €90million in rental lease payments. There’s also the small matter of over €110million in share based payments last year as well.

One of our longer standing exposures has been Avolta (AVOL.SW) where understanding cash flow is vital because of the stupidity of the statutory accounting. It has 10-15 year leases at airports under straight, base and revenue shares and so has different accounting and significant minority interests. So does its peer Lagardère (MMB.PA). We focus in each case on ECFC - Equity free cash flow - being cash flow attributable to ordinary owners after all capex. We get answers roughly in the 6-7% region. These businesses are NOT annuities and have obvious risks attached.

On our numbers, at €18 clearing price for Pershing’s stock, the UMG equity market cap is around €32,868. A reasonable estimate of EFCF unadjusted for share based payments is around €1.05billion per annum (say €950million if you SBP adjust). So the ECFC yield is about 3.2%.

You can do it on a pre-debt basis and get a better outcome with EV of €32,700 (debt nets off against market value of 6.5million Spotify shares pre any sales). On a pre debt basis notional FCF (before SBP dilution) is about €82m higher so €1.13billion or just under 3.5%.

What do I want to get excited? Say 4.25% EFCF yield which equates to ~€13.50 or so.

I would postulate that PSH knows all about FCF but perhaps using it didn’t suit the narrative . Installing capex numbers might have spoilt the financial engineering story.

AB

4 June 2026

The attached article is written by Buffett’s close friend Carol Loomis who edited the Chair’s annual letters for BRK and wrote the “Tap Dancing to Work” book about Buffett containing selected news articles on the great investor. Here is the “Fortune” article from 1997 - “Buffett’s Wild Ride at Salomon”