ACTIVITIES IN 2010

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2010 OVERVIEW

By combining the operational expertise of its local teams and the marketing know-how of the Aelia teams, Lagardère Services has continued to expand its network of upscale duty free shops, particularly in fashion. It has done this by winning a number of tenders in airports (Alicante, Malaga, Bordeaux, Nice, Heathrow, Noumea, Singapore, etc.), by strengthening the management of its Asia-Pacific operations and by further developing its Travel Retail business in the news and convenience sector, a promising sector where Lagardère Services is pursuing its expansion strategy.
During the year, the division's distribution companies tested the implementation of a diversification strategy, in both Europe and North America, by seeking to enter into business and industrial partnerships on new lines of products and services, while maintaining and enhancing their leadership positions in their traditional markets.

2010 KEY EVENTS

A strong international presence in the Travel Retail industry

Lagardère Services is continuing to test new marketing concepts by opening new retail outlets and renewing various concession contracts in transportation hubs.

Thanks to its Relay chain, Lagardère Services operates the leading international network of press outlets, offering travellers an extensive range of products selected to make their travel experience more enjoyable, including reading material, souvenirs, food products and more.

With operations in 120 airports worldwide, Lagardère Services has duty free shops in Europe and Singapore(alcohol, tobacco, perfume, food, fashion, etc.) under the Aelia brand name. In addition to its own brands (Buy Paris Duty Free in partnership with Aéroports de Paris, Beauty Unlimited, Pure and Rare, Gourmand, Sunny Days, Men's Lounge, etc.) and its franchises (Virgin, Hermès, Hédiard, L'Occitane), the Group's division also operates an in-flight sales service for upscale brands on behalf of various airlines, and operates duty free shops at ports along the Spanish Mediterranean coast.

In train stations and airports throughout Europe, North America and Australia, the division also operates stores featuring music and reading material and consumer electronics under the Virgin brand.

Lagardère Services is also active in new retail trade segments - fast food and specialised concepts - through partnerships with leading retailers (Costa, La Cure Gourmande, Paul, Moa, L'Occitane, etc.) or under its own brands (Trib's, Hubiz).

With Travel Retail accounting for 41% of its total sales, Lagardère Services is a major player in this business sector and intends to rapidly strengthen its positions.

Innovating to promote electronic commerce

Lagardère Services continued developing the magazine-download platform Relay.com with new applications: the iPhone version of its download service as well as iPad and Galaxy Tab applications that can be used on these latest tablets to access 400 magazines on the platform.
There were more than 2.5 million downloads during the year.

Press Distribution and urban outlets

Supplying points of sale with newspapers and magazines is essential for the marketing of these products. Lagardère Services performs this function with two levels of operations:

• A world leader in the distribution of national periodicals, Lagardère Services is the No.1 distributor in the United States, Belgium, French-speaking Switerland, Spain and Hungary, where Lagardère Services supplies chains of convenience stores: Lapker in Hungary, with about 12,000 points of sale, and SGEL in Spain (16,000 points of sale). Curtis Circulation Company, the leading national magazine distributor in North America with a 30% market share, operates a network of independent wholesalers and manages sales of the magazines it represents to the largest retail chains. In Spain, SGEL is the top national distributor of periodicals with a 32% market share.
  
  
• Lagardère Services is a leading importer and exporter of international publications, with operations in nine countries (Belgium, Bulgaria, Canada, Spain, the United States, Hungary, the Czech Republic, Romania, and Frenchspeaking Switzerland). 

Lagardère Services is also developing the convenience store concept under several trade names to offer consumers the press and other services: Inmedio in Hungary, Poland; the Czech Republic and Romania; BDP in Spain; Press Shop in Belgium; and Naville in Switzerland.