NEOPOST_REGISTRATION_DOCUMENT_2017

5

Financial statements

Consolidated financial statements

Executive compensation 9-6: The main role of the management team is to make strategic decisions for the Group and coordinate their implementation around the world. The gross remuneration of the management team (whose members are mentioned in chapter 2 “Corporate Governance") including Chairman & Chief Executive Officer Mr Denis Thiery, amounted to 6.2 million euros in 2017, compared with 5.1 million euros in 2016. Variable remuneration is determined on the basis of attaining Group sales, operating income and working capital requirement targets. The variable remunerations shown in this table are the amounts booked during the current financial year. The Group recognized an expense of 1.6 million euros in 2017 in respect of stock options and free shares granted to the management team, compared with 0.7 million euros in 2016. 122,000 shares were granted to members of the management team during the 2017 financial year compared with 89,000 in the previous year.

With respect to pensions, the Chairman & Chief Executive Officer, as well as a number of other Group executives benefit from a defined contribution pension plan (article 83 of the French general tax code), into which is paid a total of 5% of their remuneration, within the limit of five times the Social Security maximum amount as well as a defined benefit pension scheme (article 39 of the French general tax code) with an annuity obligation of 1.1% of pay per year of service for a minimum of eight years and a maximum of twenty years. This annuity is paid after the deduction of the annuities paid within the usual defined contribution plans. For employee taking their retirement before reaching the legal full retirement age, the benefit is subject to a reduction proportional to the number of remaining years (this annuity being net of benefits from other applicable defined contribution plans). The amount of these liabilities at the end of January 2018 totaled 9.1 million euros compared with 9.4 million euros as at 31 January 2017 and concerns all the members of the management team. Cumulative payments stand at 6.9 million euros as at 31 January 2018.

Other provisions, contingent liabilities and other non-current Note 10 debts

10-1:

Other provisions

10-1-1:

Accounting principles

a probability that an outflow of resources will be • necessary to extinguish the obligation with no offset expected; an amount that can be reliably measured. • Provisions are split on the balance sheet between current and non-current liabilities.

Provisions are recognized when the following conditions are met simultaneously at the end of the period in question: a current obligation (legal, regulatory, contractual or • implied) resulting from past events;

10-1-2:

Changes in other provisions

31 January 

31 January 2018

Short term portion

Long term portion

2017 Added

Used Non-used

Other

Other provisions Structure optimization Business risk/customer guarantees

7.5

14.0 (15.1)

(0.8)

(0.3)

5.3

5.3

-

0.5

0.1

(0.0)

(0.2)

0.0

0.4

0.4

-

Dispute provisions

3.6

1.7

(0.6)

(0.4)

0.3

4.6

2.0

2.6

Other

1.7

3.4

(0.7)

(0.6)

(0.3)

3.5

2.8

0.7

13.3 19.2 (16.4)

(2.0)

(0.3)

13.8

10.5

3.3

Retirement benefit obligations – note 9-3

24.5

5.3

(5.0)

(0.1)

(0.9)

23.8

-

23.8

Long term incentives – note 9-5

2.1

0.8

(1.1)

(0.3)

(0.0)

1.5

0.5

1.0

TOTAL

39.9 25.3 (22.5)

(2.4)

(1.2)

39.1

11.0

28.1

140

REGISTRATION DOCUMENT 2017 / NEOPOST