investment case.

The Randstad Group is a global leader in the HR services industry and specialized in solutions in the field of flexible work and human resources services. Our services range from regular temporary Staffing and permanent placements to Inhouse Services, Professionals, and HR Solutions (including Recruitment Process Outsourcing, Managed Services Programs, and outplacement).

Geographically, Randstad is active in countries representing over 90% of the global HR services market, and our strategy has been designed to capitalize on the structural growth drivers in these markets. Throughout our markets, we see that global developments are affecting labor markets, which is leading to an intense discussion about the future of work. This has also led to a redefinition of our growth drivers. Randstad currently identifies five global trends that affect our business and which provide opportunities for growth: (1) globalization, (2) technology, (3) demographics, (4) the increasing variety of work forms, and (5) governance of work.

As the leading innovative player in HR services, digital transformation is a very important pillar of our overall strategy going forward. This is part of our broader Tech & Touch strategy that focuses on a solid technological and data-driven foundation, combined with our excellent human touch. We believe that this approach will differentiate us from our competitors, who are either tech disruptors such as self-service and digital platforms, or more traditional HR players with a focus on talent engagement. Randstad takes an integrated approach, claiming presence in all areas of the HR services playing field, from purely digital to specifically human.

Shareholder value is of utmost importance to us. Given our primarily organically focused Tech & Touch strategy going forward, our strong balance sheet, and favorable FCF outlook in various economic scenarios, we will adjust our capital allocation strategy. This amendment will be twofold. First, we will change our dividend policy by implementing a conditional cash floor dividend of € 1.62 per share (based on the average dividend per share (DPS) of 2014, 2015 and 2016). This baseline dividend level will be maintained even when the general 40-50% payout ratio is temporarily exceeded, barring (1) seriously adverse economic conditions, (2) material strategic changes to the sector and (3) a material deterioration in our solvency & liquidity ratios. Second, we will introduce optional additional cash returns in the event of a leverage ratio below 1.0 through (1) a special dividend (preferred) or (2) share buybacks.

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