SOMFY_ANNUAL_FINANCIAL_REPORT_2017

07 CONSOLIDATED FINANCIAL STATEMENTS

ANALYSIS OF CASH FLOW STATEMENT NOTE 8 — CASH AND CASH EQUIVALENTS NOTE 8.1

CHANGE IN WORKING CAPITAL REQUIREMENTS NOTE 8.3

€ thousands

31/12/17

31/12/16

€ thousands

31/12/17

31/12/16

CASH AND CASH EQUIVALENTS AT THE START OF THE PERIOD Cash and cash equivalents at the start of the period CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD Cash and cash equivalents at the end of the period Bank overdrafts

Net decrease/(increase) in inventory Net decrease/(increase) in trade receivables Net (decrease)/increase in trade payables Net movement in other receivables and payables CHANGE IN WORKING CAPITAL REQUIREMENTS

–19,733

–15,255

126,249

99,272

–17,238

–19,552

133,847

103,787

24,410

7,497

–7,598

–4,515

2,657

–33

212,564

126,249

–9,905

–27,344

212,834

133,847

Bank overdrafts

–269

–7,598

COMPANIES ACQUISITIONS AND DISPOSALS, NOTE 8.4 NET OF CASH ACQUIRED OR DISPOSED OF No companies were acquired or disposed of during the 2017 financial year. As a reminder, the net cash flows resulting from the 2016 acquisitions consisted of the acquisitions of Myfox for €2.8 million and of iHome for €1.6 million, as well as of the purchase of non-controlling interests in BFT Piemonte and BFT Adria for a total amount of €0.1 million. The cash flow corresponding to disposals of companies in the 2016 financial year, net of the cash disposed, was only affected by the sale of Giga for €1.2 million.

INTANGIBLE ASSETS AND PROPERTY, NOTE 8.2 PLANT AND EQUIPMENT

Receivables and liabilities related to intangible assets and property, plant and equipment are included in investment activities in the cash flow statement and increased by €0.2 million in the year ended 31 December 2017 compared with an increase of €0.9 million in 2016. During 2017, the Group acquired intangible assets and property, plant and equipment totalling €66.0 million, compared with €66.5 million in 2016. Net of cash receipts related to disposals of intangible assets and property, plant and equipment, investments totalled €64.5 million in 2017, unchanged compared with 2016. PROVISIONS AND CONTINGENT LIABILITIES NOTE 9 — PROVISIONS NOTE 9.1 This includes commitments with an uncertain maturity date or amounts resulting from restructuring operations, litigations or other risks. A provision is established when the Group has a current obligation (legal or constructive) resulting from a past event and when future cash outflows can be measured reliably. The Group is party to a number of litigation and arbitration proceedings with third parties or with the tax authorities of certain countries in the normal course of its business. Provisions are recorded for these proceedings when a legal, contractual or constructive obligation exists at the end of the reporting period with respect to a third party; it is probable that an outflow of resources embodying economic benefits will be required in order to settle the obligation with no consideration in return, and a reliable estimate can be made of this obligation. Similarly, if the Group has uncertainties concerning the tax treatment it has adopted in respect of certain events or transactions, provisions are recognised if it is probable that the Group’s tax liabilities would be reassessed in the event of a tax audit. A provision for restructuring is recognised when there is an obligation toward third parties, originating from a Management decision materialised before year-end by the existence of a

detailed and formal plan, which has been announced to the personnel affected or their representatives. When the Group expects full or part repayment of an expense that was the subject of a provision, by way of the existence of an insurance contract for instance, the repayment is recognised as a separate asset but only if repayment is virtually certain. The provision charge is taken to the income statement, net of any repayment. In order to cover costs inherent in guarantees given to customers, the Group recognises a provision for charges. This provision represents the estimated amount, based on statistics of charges recognised in the past, as a result of repairs during the guarantee period. At each year-end, this provision is reversed for the actual amount of services rendered recorded as expenses for the financial year. If the impact of the time value of money is significant, provisions are discounted on the basis of a rate after tax which reflects the specific risks of the liability. Where a provision is discounted, the increase in the provision relating to the discounting is recorded as an operating expense.

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SOMFY – ANNUAL FINANCIAL REPORT 2017