Plastic Omnium - 2020 Universal Registration Document

CONSOLIDATED FINANCIAL STATEMENTS 2020 Consolidated financial statements at December 31, 2020 www.plasticomnium.com PLASTIC OMNIUM UNIVERSAL REGISTRATION DOCUMENT 2020 208 Deferred tax assets 2.1.3 The Group’s tax position has been analyzed taking into account the estimated effects of the Covid-19 crisis on future results. In accordance with the Group’s accounting principles, “Tax credits and deferred tax assets on tax loss carryforwards and temporary differences are only recognized when the probability of their utilization within a relatively short period of time is proven” (please refer to Note 1.9 “Income Tax”in the accounting policies). Thus, taking into account lower future results, impairments deferred tax assets amounted to €79.1 million for the period. Impacts over the fiscal year 2020 are explained in Note 4.8 “Income tax”. Implementation of part-time activity and State aid 2.1.4 From March, as the Covid-19 crisis was recognized as a pandemic (which emerged in January 2020 in China), the Group gradually closed all of its production sites as its automotive manufacturer customers shut down their own sites. In the second half of 2020, the plants remained open and in operation with maximum use of remote working (home office). Protective measures have led the Group to promote remote working (home office) whenever possible and essential, and to set up part-time activity in strict compliance with the legislation and the provisions taken by the authorities of each country where the Group is established. At December 31, 2020, State aid received in the context of partial activity amounted to €31.7 million and was recognized as a reduction in staff costs (see Note 4.3 “Staff costs”). Other costs related to Covid-19 2.1.5 The Group has implemented very strict health measures ranging from protective equipment for employees, hydro-alcoholic gels, temperature-taking equipment, regular disinfection of premises, floor markings and the display of instructions, etc. Total additional costs resulting from the Covid-19 crisis amounted to €13.4 million recognized in operating expenses at the operating margin level. Other commitments made by the Group following 2.1.6 Covid-19 As part of its Corporate Social Responsibility (sustainability) policy ACT FOR ALL TM , the Group has committed to an amount of €1 million to help charities in favor of the elderly, isolated people, medical staff and all occupations engaged on the front line facing Covid-19. At December 31, 2020, the cost of actions taken amounted €0.7 million. Going concern 2.1.7 The Group’s business recovery and the improved sales in the second half of the year, despite the ongoing pandemic, confirmed the Group’s resilience: sales improvement in the 2 nd half of 2020 compared to the drop in the ● 1 st half: 2 nd half of 2020: the Group’s sales compared to the same period ● inthe previous year dropped by -2.7% (+0.8% like-for-like) while the automotive market in volume terms (IHS information (1) ) changed by -0.4%; 1 st half of 2020: the Group’s sales compared to the same period in ● the previous year dropped by -30.6% (-30.3% like-for-like) while the automotive market in volume terms (IHS information (1) ) changed by -32.8%; based on information known as of December 31, 2020, IHS projections ● forecast a return to the pre-pandemic level of worldwide vehicle production, i.e . around 87 million vehicles in 2023; as of December 31, 2020, the Group’s balance sheet remains solid ● with a “Gearing” which amounted to 41.4% (see Note 6.1 “Capital management”); the Group’s liquidity as of December 31, 2020 was strengthened since ● the end of the previous year and with no major maturities before 2023 (see Note 5.2.6 “Current and non-current borrowings” and 6.4.2 “Liquidity risk by maturity”); cash forecasts for 2021, at the publication date of financial statements ● at December 31, 2020, show positive free cash flow generation. Other significant events of the period 2.2 Financing transactions 2.2.1 IMPLEMENTATION OF CREDIT LINES AND UTILIZATION 2.2.1.1 DURING THE PERIOD During the fiscal year, The Group negotiated additional €560 million of credit lines with its banking partners. See Notes 5.1.11 “Cash and cash equivalents”, 5.2.6.6 “Confirmed medium-term credit lines” and 5.2.6.7 “Reconciliation of gross and net financial debt”. ISSUANCE OF “NEGOTIABLE EUROPEAN COMMERCIAL 2.2.1.2 PAPER” (NEU-CP) During the 2020 fiscal year, the Group issued “Neu-CP” maturing in less than one year to European investors for €200.5 million as of December 31, 2020. The terms of these issuances are provided in Note 5.2.6.5 “Short-term borrowings: issuance of “Negotiable European commercial paper” (Neu-CP)”. See also Note 5.2.6.7 “Reconciliation of gross and net financial debt”. IHS for “IHS Markit”, an Anglo-American specialist economic information company, which publishes trends and forecasts, particularly for the automotive sector. (1) Publication: IHS database as of Jan 15th. 2021 – [0;3.5t PC + LCV].