Euronext - 2020 Universal Registration Document

Financial Statements

Notes to the Consolidated Financial Statements

NOTE 18 GOODWILL AND OTHER INTANGIBLE ASSETS

Intangible assets recognised on acquisition of subsidiaries

Purchased softw. Constr. in Pr. Patents & TrMr

Internally developed software

Customer Relations

Brand Names

Goodwill

Software

Total

In thousands of euros

As at 31 December 2018 Cost

644,299

93,503

46,297

12,815

74,393

7,181

878,488

Accumulated amortisation and impairment

(53,341)

(67,380)

(42,183)

(4,701)

(5,247)

–

(172,852)

Net book amount

590,958 590,958

26,123 26,123

4,114 4,114

8,114 8,114

69,146 69,146

7,181 7,181

705,636 705,636

As at 1 January 2019 net book amount

(221)

49

28

108

(679)

118

(597)

Exchange differences

Additions

–

9,655

1,739

–

–

–

11,394

Impairment charge/write off

–

(199)

–

–

–

–

(199)

Transfers and other

–

9

84

–

–

–

93

Acquisitions of subsidiaries

501,319

1,344

652

38,919

223,030

–

765,264

Amortisation charge (Note 10)

–

(6,758)

(1,563)

(6,330)

(8,180)

–

(22,831)

As at 31 December 2019 net book amount

1,092,056

30,223

5,054

40,811

283,317

7,299 1,458,760

As at 1 December 2019 Cost

140,018

49,167

51,963

296,836

7,299 1,690,680

1,145,397

Accumulated amortisation and impairment

(53,341)

(109,795)

(44,113)

(11,152)

(13,519)

–

(231,920)

Net book amount

1,092,056 1,092,056

30,223 30,223

5,054 5,054

40,811 40,811

283,317 283,317

7,299 1,458,760 7,299 1,458,760

As at 1 January 2020 net book amount

(43,039)

(380)

(133)

(2,967)

(16,469)

(691)

(63,679)

Exchange differences

Additions

–

11,219

1,350

–

–

–

12,569

Impairment charge/write off

–

–

(1,549)

–

–

–

(1,549)

Transfers and other

758

231

(797)

–

–

–

192

Acquisitions of subsidiaries (Note 5)

49,655

16,439

3,768

34,420

48,151

9,779

162,212

Amortisation charge (Note 10)

–

(8,218)

(1,973)

(9,825)

(12,352)

–

(32,368)

As at 31 December 2020 net book amount

1,099,430

49,514

5,720

62,439

302,647

16,387 1,536,137

As at 31 December 2020 Cost

1,153,753

172,229

55,574

82,982

327,916

16,387 1,808,841

Accumulated amortisation and impairment

(54,323)

(122,715)

(49,854)

(20,543)

(25,269)

–

(272,704)

Net book amount

1,099,430

49,514

5,720

62,439

302,647

16,387 1,536,137

8

Goodwill impairment test Goodwill is monitored and tested for impairment at the lowest CGU Group level of the Group to which goodwill acquired in a business combination is allocated (see Note 3). Following the acquisitions of Euronext FX (former FastMatch Inc.) in 2017 and Nord Pool Holding AS in 2020 and the allocation of goodwill from those transactions to respectively the “FX Trading” CGU and the “Nord Pool” CGU, the Group tests goodwill at the level of three CGUs (Groups): “Euronext”, “FX Trading” and “Nord Pool”. Euronext CGU (Group) The recoverable value of the “Euronext” CGU Group is based on its fair value less cost of disposal, applying a discounted cash flow approach, and corroborated by observation of Company’s

market capitalisation. The fair value measurement uses significant unobservable inputs and is therefore categorised as a Level 3 measurement under IFRS 13. Cash flow projections are derived from the 2021 budget and the business plan for 2022. Key assumptions used by management include third party revenue growth, which factors future volumes of European equity markets, the Group’s market share, average fee per transaction, and the expected impact of new product initiatives. These assumptions are based on past experience, market research and management expectation of market developments. For the impairment test performed as of 31 December 2020, revenues have been extrapolated using a perpetual growth rate of 1.3% (2019: 1.0%) after 2021. The weighted average cost of capital applied was 6.9% (2019: 7.3%).

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2020 UNIVERSAL REGISTRATION DOCUMENT