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The Group uses several categories of raw materials to manufacture its products: PVCs and plasticizers for vinyl flooring, wood for wood and laminate flooring, polymers and fibers for carpets and artificial turf, rubber for rubber flooring and accessories (such as baseboards) and artificial turf, and cork for linoleum flooring. The Group builds and maintains close and structured relationships with all of its suppliers. The structure of its long-term relationships with

suppliers enables it to optimize purchasing terms and adapt the Group’s procurement policy to the specific needs of each country.

6.1.8.1 Raw Materials 6.1.8.1.1 PVC and Plasticizers

The Group primarily uses two raw materials to manufacture its products PVC and plasticizers:

These are used to manufacture homogenous and heterogeneous vinyl.

PVC and plasticizers together represented approximately two-thirds of the Group’s raw material costs in 2013. The PVC and plasticizers markets are global with regional differences relating to the relationship of supply and demand in different geographies.

The evolution in the price of these commodities over the last two years has mainly been tied to that of their respective raw materials, ethylene for PVC and naphtha and orthoxylene for plasticizers.

Moreover, when the Group makes acquisitions, it ensures that it is able to reduce raw material costs by asking the target’s suppliers to honor the prices negotiated with the rest of the Group.

The Group is currently evaluating raw material opportunities in its various geographic regions.

Raw material prices are decreasing in North America due to the use of shale gas there. Although the Group still favors local procurement in Europe, primarily because of transportation costs, the lowered cost of raw materials in North America is likely to have a positive impact on negotiations with European raw material suppliers.

6.1.8.1.2 Other Raw Materials

Wood represented approximately 10% of the Group’s raw material costs in 2013. The Group uses wood to make wood and laminate flooring. The wood flooring market remains very local, due to the significant cost of transporting logs or rough timber. The Group is therefore subject to local fluctuations in the price of wood.

The Group purchases other raw materials, in particular fiberglass for vinyl flooring; rubber for rubber flooring, accessories and artificial turf; polypropylene for carpet; melamine and decor paper for laminate floors; and linseed oil, jute and cork for linoleum floors.

6.1.8.2 Supplier Relationships and Purchasing Policy

Suppliers are essential partners of the Group, with whom it develops close and durable relationships. The Group has chosen to develop long-term relationships with all of the participants in its supply chain. The Group organizes its relations with suppliers around strategic partners with global scale and local suppliers able to adapt to local demands.

6.1.8.2.1 Supplier Relations

For each category of raw materials, the Group has developed relationships with several partner suppliers at the global level. In 2013, its ten largest suppliers accounted for 53% of raw materials purchases.

The Group is careful to maintain relationships of trust over the long term with all of its suppliers.

These relationships enable the Group to negotiate favorable commercial terms, to obtain productivity gains and to realize economies of scale.

In order to adapt its procurement structure to different geographic regions, the Group has put supplier partnerships in place at different levels:

• It buys PVC and plasticizers from the leading international chemical companies, such as Vinnolit, Ineos, Vestolit, BASF, Eastman and Evonik, which supply the Group throughout the world.

• It also buys raw materials from local suppliers, in particular wood, the majority of which is purchased from local sawmills.

It maintains interdependent relationships with certain suppliers, especially sawmills, based on their dependence on sales to wood and laminate flooring factories. The Group’s relationships with these suppliers often become long-term partnerships.

For artificial turf, the Group joined with a fiber-extrusion specialist to produce high-quality fibers with a unique geometry. This enables the Group to produce the fiber it needs to manufacture artificial turf without depending on an external supplier.

In order to limit transport of certain raw materials, the Group tries to locate its factories close to suppliers. Accordingly, the wood and laminate flooring factories are built close to local sawmills to avoid excessive costs from wood transport.

6.1.8.2.2 Purchasing Policy

The Group tries to centralize its purchases at the global level for the most important raw materials, in particular PVC and plasticizers, as well as for fiberglass and titanium dioxide purchases, which are used to manufacture vinyl flooring.

In the Group’s supplier agreements, pricing is indexed to market prices of the raw materials used in manufacturing its products. Most of these agreements have one-year terms, with three-year terms in certain cases. The Group is not obligated by these agreements to purchase specific quantities of materials.

The Group’s purchasing policy is based on four principles:

• active management of its portfolio of suppliers;

• annual review of its principal contracts;

• diversification of raw materials; and

• collaboration with key suppliers.

The Group actively manages its portfolio of partner suppliers. It has significantly reduced the number of PVC grades that it uses, which allows it to negotiate more easily with the various PVC suppliers, in particular with respect to price. The Group has increased the number of plasticizer

suppliers it uses, with the increase in suppliers enabling it to improve its negotiating power over price. This supplier diversification gives the Group room to maneuver in negotiating prices.

The Group reviews its main contracts annually in order to renegotiate prices and determine supplier availability. Price formulas give the Group visibility as to price evolution over several years. Diversification of the raw materials that the Group uses enables it to substitute inputs between several suppliers and thus reduce its dependence on certain specialized suppliers.

The Group tries to cooperate closely with its key suppliers on technical issues and innovations. It explains its growth objectives to them in order to ensure that they increase production capacities sufficiently to respond to increased demand.

6.1.9 Research and Development, Innovation, Standards Applicable to the Group’s