Econocom - 2019 Universal registration document

05 management report profit for the year

profit (loss) from discontinued operations, • net of tax effects. Net and gross debt The definition of net debt used by the Group (see note ژ 14.3 to the consolidated financial statements) is gross debt less gross cash and cash equivalents. It does not include the Group's gross liability for purchases of leased assets or its residual interest in leased assets. Gross debt includes all interest-bearing debt and debt incurred by receiving financial instruments. Parent company 2019 2.3. financial statements of Econocom group SE Econocom group SE, as the Group’s holding company, manages a portfolio of securities, receives dividends from its subsidiaries and oversees the Group’s development. It also provides services to the Group’s subsidiaries in the areas of management, IT, cash, guarantees, provision of staff, consulting, communication and marketing. These services are billed according to normal market terms. The revenue stated hereafter refers to Econocom group SE’s parent company financial statements, prepared in accordance with Belgian legislation. INCOME STATEMENT OF 2.3.1. ECONOCOM GROUP SE The cost of services rendered to the Group’s subsidiaries during the year totalled €23.5 ژ million, compared with €24.8 ژ million in the previous year. Operating profit for the year amounted to €2.6 ژ million, compared with €5.1 ژ million in 2018.

Recurring totalled €19.5 ژ million, compared with €14.3 ژ million in 2018. It consists mainly of dividends received from subsidiaries in the amount of €18.7 million (compared to €19.0 ژ million in 2018), income net of interest and guarantee commissions invoiced to the subsidiaries in the amount of €12.8 ژ million (compared with €11.2 ژ million in 2018), and the cost of external debt in the amount of €11.7 ژ million (compared with €10.2 ژ million in 2018) and the capital gains or losses on sale of treasury shares representing a net expense of €0.2 ژ million this year (compared with a net expense of €5.7 ژ million in the previous year). Non-recurring financial expense totalled €39 ژ million, compared with €21.4 ژ million in 2018. It includes mainly capital losses on the disposals of Jade and Mobis, the €16.5 million impairment of securities, and the €9.6 million impairment of treasury shares. Income tax expense came to €1.9 ژ million. Net loss totalled €19.1 ژ million, compared with a loss of €2.3 ژ million in the previous year. BALANCE SHEET OF 2.3.2. ECONOCOM GROUP SE Econocom group SE’s equity stood at €349.0 ژ million, compared with €394.8 ژ million in 2018. This change can be ascribed to the refund of the issue premium in July 2019 in the amount of €27.4 ژ million and to the profit for the year (-€19.1 ژ million). The company's balance sheet shows losses in two consecutive financial years, so article 6:3 6 of the French Companies and Charities Code is applicable. These losses are mainly explained by the impairment of treasury shares. The continuity of the business is therefore in no way threatened and the application of valuation rules which assume a going concern is therefore justified. financial income

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2019 annual report