Compagnie des Alpes // 2020 Universal Registration Document

5 FINANCIAL INFORMATION

Consolidated financial statements

of the early termination, for the loss of earnings over the remaining term of the contracts. In accordance with IFRS 16 and the reduction in the duration of contracts resulting from termination, the recognition of this indemnity has been staggered until the effective date of such termination on 1 December 2020. As of 30 September 2020, income of €3.8 million was thus recognised in Other operating income and expenses. However, the company is continuing negotiations with the municipalities of Deux Alpes and Saint-Christophe and with Société Touristique de l’Alpe d’Huez to finalise a memorandum of understanding on the compensation to be received.

The handover took place on 1 December 2020. As a result, the Group recognised as assets and liabilities held for sale at 30 September 2020 all the property, plant and equipment and intangible assets and liabilities concerned for €59.4 million and €11.9 million respectively. The end of the Deux Alpes PSC resulted in various accounting impacts with a net impact of -€3.1 million in other operating income and expenses, including the recognition of an impairment of the share of the goodwill allocated to the Deux Alpes activity in the amount of €4.2 million. In addition, Deux Alpes Loisirs is compensated in respect

Note 1

Accounting principles and policies

Apart from IFRS 16 “Leases”, the standards whose application has been mandatory since 1 October 2019 had no material impact on the Group’s consolidated financial statements. l Future standards, amendments to standards and interpretations The Group has not applied, in advance, the other standards, amendments or interpretations applicable for fiscal years after 30 September 2020, whether or not adopted by the European Union. Key assumptions and estimates The preparation of the consolidated financial statements in accordance with IFRS is based on assumptions and estimates made by the Executive Management to calculate the value of assets and liabilities at the reporting date and the income and expense items for the year. The actual results may differ from these estimates. The main sources of uncertainty relating to key assumptions and assessments relate to goodwill (Note 6.1), estimates of the value of associates (Note 6.4) and financial assets at fair value (Note 6.7), as well as the impacts of the Covid-19 crisis (see highlights on page 124). CONSOLIDATION METHODS The companies in which the Group has exclusive control are fully consolidated. Associate companies are entities that the Group does not control but over which it exercises significant influence, usually with 20% to 50% of the voting rights. Shareholdings in associate companies are accounted for using the equity method and initially recognised at their acquisition cost. The Group’s interest in associate companies includes goodwill (net of accumulated impairment) as identified at the time of acquisition. The Group presents its share of net income of associate companies on a separate line of the income statement, below the operating income line. The Group does not have any joint ventures. All internal transactions and positions are eliminated, either in full for fully consolidated companies, or proportionally to the Group’s interest in the case of companies consolidated using the equity method. Internal margins are eliminated to the extent that their amount individually exceeds €500 thousand or a cumulative amount of €1 million. The list of consolidated companies can be found in Note 4.2. 1.1

The main accounting policies applied in the preparation of the consolidated financial statements are outlined below. Unless otherwise indicated, they are applied consistently across all reporting periods presented. In application of EU regulation 1606/2002 of 19 July 2002 on international accounting standards, the annual consolidated financial statements of the Compagnie des Alpes Group for the reporting period ended 30 September 2020 were drawn up in conformity with the International Financial Reporting Standards (IAS/IFRS), as adopted by the European Union at 30 September 2020, and in accordance with the historical cost convention, with the exception of certain financial assets and liabilities, which were valued at their fair value, as required under IFRS. The accounting principles used are identical to those applied for the 2019 fiscal year, with the exception of the mandatory changes in standards from 1 October 2019 described below: Changes in accounting standards The Group has applied the new standards, amendments to standards and interpretations that must be applied to fiscal years beginning on or after 1 October 2019. l IFRS 16 Leases IFRS 16, the new standard on leases, replaces IAS 17 and the corresponding interpretations. This standard removes the distinction between operating leases and finance leases. It introduces a single model for recognising leases on the lessee’s balance sheet, with the recognition of an asset representing the right to use the leased asset and a liability for the obligation to pay rent. The Group has applied IFRS 16 retrospectively from 1 October 2019, but did not restate the comparative information for FY 2018/2019, as permitted by the specific transition provisions provided for by the standard (“simplified retrospective method”). As a result, the reclassifications and adjustments resulting from the first-time application of IFRS 16 are recognised in the opening balance sheet at 1 October 2019. The impacts of the application of IFRS 16 on the Group’s consolidated financial statements are presented in Note 8. l Uncertainties relating to tax risks (IFRIC 23) IFRIC 23 deals with uncertain tax positions relating to income taxes. It clarifies that an entity must assess whether it is likely that the tax authorities will accept a treatment retained in its tax returns, assuming that it has all the relevant information to carry out its controls. If this is the case, the tax accounting must correspond to the tax declarations. The Group has applied the IFRIC 23 interpretation using the retrospective method, without restatement of comparative data, as authorised by the specific transition provisions.

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Compagnie des Alpes I 2020 Universal registration document