DUFRY AG Listing of 4,218,750 Registered Shares

The retail business is highly competitive.
Dufry also competes to attract retail customers. As Dufry’s sales of non-traditional duty-free products
increases, Dufry must compete with other, non-airport retailers, such as ‘High Street’ retailers. Some of Dufry’s
retail competitors may have greater financial resources, greater purchasing economies of scale and/or lower cost
bases, any of which may give them a competitive advantage over Dufry. If Dufry were to lose market share to
competitors, its revenues would be reduced and its business, financial condition and results of operations
adversely affected. See “Business—Competition.”
Dufry relies on a limited number of suppliers.
Dufry relies on a small number of suppliers for the majority of its purchases in each major product
category. Future consolidation may reduce Dufry’s number of suppliers even further. As a result, Dufry’s
suppliers may have increased bargaining power and Dufry may be required to accept less favorable purchasing
terms. In addition, in the event of a dispute with any supplier, the delivery of a significant amount of
merchandise may be delayed or cancelled, or the Company may be forced to purchase merchandise from other
suppliers on less favorable terms. Such events could cause revenues to fall and costs to increase, adversely
affecting the Company’s business, financial condition and results of operations.
Dufry has operations in emerging markets which exposes it to risks inherent to such less developed
markets.
Dufry has operations in a number of emerging markets. Business climates in these countries expose the
Dufry Group to a variety of greater political, economic, legal and social uncertainties than countries with more
developed institutional structures, and the risk of loss resulting from changes in law, economic and social
upheaval and other factors may be substantial. Among the more significant risks of operating and investing in
emerging market countries are those arising from interruption of operations due to political or social instability,
the establishment or enforcement of foreign exchange restrictions, which could effectively prevent Dufry from
repatriating profits, liquidating assets or withdrawing from one or more of these countries. Furthermore, changes
in tax regulations or enforcement mechanisms could substantially reduce or eliminate any revenues and profits
derived from operations in these countries and reduce significantly the value of assets related to such operations.
Another aspect of certain emerging markets is the inadequacy of the legal system and law enforcement
mechanism, which leaves Dufry exposed to the possibility of considerable loss as a result of abusive practices
by competitors, parties with which it contracts or others.
Exchange rate fluctuations may have a material negative effect on Dufry’s business, financial condition
and results of operations.
Dufry faces two types of exchange rate risk. Firstly, it faces transaction exposure: a certain amount of its
sales are denominated in the currencies of the countries in which it operates, while its related costs and expenses
are primarily denominated in US dollars or Euro, and vice versa. Therefore, significant movements in currency
rates may have an adverse effect on its business, financial condition and results of operations. In Brazil, for
instance the product pricing is done in US dollars. A depreciation of the Brazilian real leads to a diminished
purchase power of local customers, whereas an appreciation strengthens the Brazilian’s purchase power. Some
fix costs are denominated in Brazilian reais. Thus, any fluctuations in the value of the Brazilian real versus the
US dollar can adversely affect Dufry’s Brazilian business, its financial condition and results of operations.
The second type of risk is the translation exposure, which arises as a result of Dufry’s reporting in Swiss
Francs, while a major part of its assets and liabilities are denominated in currencies other than the Swiss Franc.
E.g., in the first half of 2008, Dufry’s turnover increased by 15.3 percent in comparison to the first half of 2007
measured on constant foreign exchange rates, but the negative foreign exchange accounting effects of 11.1
percent mainly related to the translation of the weakening US dollar against the Swiss Franc resulted in a
turnover growth of only 4.2 percent relative to the first six months 2007. Therefore, increases and decreases in
the value of the Swiss Franc against other currencies may affect operating and financial results and cash flows,
and the value of its assets and liabilities as reported in its consolidated financial statements.
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