Compagnie des Alpes // 2020 Universal Registration Document

5 FINANCIAL INFORMATION

Consolidated financial statements

1.2

APPROVAL OF THE FINANCIAL STATEMENTS OF CONSOLIDATED COMPANIES

l on the other hand, international consulting services (CDA Management and CDA Beijing), the activities of tour operators, travel agencies and other real estate activities (including the Travelfactory group) which, taken individually, do not meet the requirements of the criteria defining an operating segment. A chart showing the Group’s consolidated companies, grouped by segment, is given in Note 4.2.

The consolidated financial statements cover a 12-month period, from 1 October 2019 to 30 September 2020 for all companies, except for Groupe Compagnie du Mont-Blanc consolidated using the equity method over the period from 1 September 2019 to 31 August 2020.

1.5

BUSINESS COMBINATIONS AND GOODWILL

1.3

TRANSLATION OF FINANCIAL STATEMENTS AND OF TRANSACTIONS EXPRESSED IN FOREIGN CURRENCIES

The Group recognises the identifiable assets, liabilities and contingent liabilities of acquired entities at fair value on the date of taking of control. Where the agreement governing the business combination provides for a payment that is contingent on future events, the Group includes the amount of this payment in the cost of the business combination at the vesting date, if the payment is probable and can be reliably measured. In the case of acquisitions of companies holding concession agreements, an analysis and fair value measurement of these agreements are performed on the basis of the expected profit margin at the end of the concession agreement. Any variance between the profitability of the concession agreement and the Group average is recognised under (intangible) assets or liabilities (provisions). It is amortised or recovered over the remaining term of the concession. Goodwill is the excess of the cost of an acquisition over the fair value of the Group’s share in the identifiable net assets of the subsidiary or associate on the vesting date. Goodwill arising from the acquisition of a subsidiary is recognised under the item “goodwill”. Goodwill arising from the acquisition of an associate company is recognised under the item “investments in associate companies”. The Group is allowed 12 months from the vesting date to finalise accounting for the business combination in question. Any changes to the acquisition price made outside the allocation period are recognised in profit or loss and no change is made to the acquisition cost or goodwill. REVENUE Sales of tickets (ski lift passes and admission fees to parks) are recognised in the reporting period in which visitors use the facilities of the Compagnie des Alpes Group. Prepaid tickets that will be used during the following period are only recognised in income when used for admission to a site. Unused prepaid tickets are recognised as deferred income. Services are recognised in income when the service is rendered. The sale of merchandise (shops and food services) is recognised when realised. In the consulting business, revenues relate to the invoicing of service and management consulting contracts. This happens when the services rendered are completed. In the tour-operator business, revenue depends on the distinction between agent and principal. When the Company acts as an agent, revenues relate to the commissions collected and when it acts as principal and bears notably the risks that come with owning inventory, it recognises revenue for the total amount of the price expected in exchange of goods or services provided and the amount paid to the third party is recognised as an expense. 1.6

The financial statements of foreign subsidiaries are translated into the presentation currency (euro) by applying the following methods: l the balance sheet (including goodwill) is translated at the closing rate; l the statement of comprehensive income is translated at the average exchange rate for the period; l all resulting translation gains or losses are recognised in a separate component of shareholders’ equity. Translation gains or losses resulting from the translation of net investments in foreign operations and loans and other currency instruments designated as hedges on said investments are recognised in shareholders’ equity upon consolidation. OPERATING SEGMENTS In accordance with IFRS 8 “Operating Segments”, the segment information presented is prepared on the basis of internal management data used for the analysis of business performance and the allocation of resources by the Chairman and Chief Executive Officer and the Directors of the Executive Committee, who form the Group’s main operational decision-making body. An operating segment is a distinct component of the Group engaged in activities likely to generate revenues and incur expenses, whose operating results are regularly reviewed by the operational decision- making body and for which separate information is available. Each operating segment is monitored individually in terms of internal reporting, based on performance indicators common to all sectors. The segments presented under segment information are operating segments or groupings of operating segments. They correspond to the Group’s main business lines. The breakdown of operating segments reflects the Group’s organisation. The management data used to assess the performance of a segment are prepared in accordance with the IFRS principles applied by the Group for its consolidated financial statements. The operating segments identified are as follows: l Ski areas : this business mainly consists in the operation of ski lifts and maintenance of ski runs and trails; l Leisure parks : this segment covers the operation of theme parks, combined amusement and animal parks, water parks, wax museums and tourist sites. Its revenue figures include admission tickets, restaurants, shops and accommodation; l In addition, Holdings and supports include: l on the one hand, the holding companies and operational support subsidiaries (including CDA SA and CDA-DS, its financial subsidiary CDA Financement, its reinsurance subsidiary Loisirs- Ré and the company INGELO), 1.4

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Compagnie des Alpes I 2020 Universal registration document