Groupe Renault - 2019 Universal Registration Document

01

RISK FACTORS GROUPE RENAULT

The contractual documentation covering these funding schemes, including bank loans, does not contain any clause that could affect the continued supply of credit as a result of changes in either Renault’s credit rating or its financial ratios. Some funding agreements, in particular for capital market fundings, contain some market standard clauses ( pari passu , negative pledge, cross default). Renault also has committed credit lines with banking institutions none of which were used in 2019. They also constitute a liquidity reserve for the Automotive division (see note 23-C of the notes to the consolidated financial statements). The contractual documentation for the committed credit lines contains no clause that might adversely affect credit availability or continuation as a result of a change in Renault’s credit rating or financial ratio compliance. Liquidity risk management is based on an internal model that defines the level of the liquidity reserve that the Automotive division must maintain to finance its activity and its growth. The liquidity reserve level of the Automotive division is subject to close monthly monitoring, through an internally approved periodic review and reporting. In view of its available cash and committed credit lines not drawn as of December 31, 2019, the Automotive division has sufficient financial resources to honor its commitments for the next 12 months (see note 25-B1). Renault SA moreover is subject to financial ratings by several rating agencies. Any revision of these ratings could limit and/or increase the cost of access to capital markets.

Liquidity risk Under its cash centralization policy, Renault ensures most of the refinancing for the Automotive division in the capital markets, mainly through long-term financial instruments (bonds and private placements), short-term funding such as NEU CP (Negociable EUropean Commercial Paper), bank loans or in the form of financing provided from public or parastatal institutions. RENAULT SA - MATURITY SCHEDULE FOR REDEMPTION OF BONDS, BANK AND EQUIVALENT DEBT (EXCLUDING REDEEMABLE SHARE & NEU CP) AT DECEMBER 31, 2019 (1)

1,750

1600

1200

950 947

896

750

678

800

500

243

400

0

2020 2021 2022 2023 2024 2025

2027

2026

A redemption schedule of the Automotive’s financial liabilities is presented in note 23-D to the consolidated financial statements. Renault has an EMTN bond program with €7 billion ceiling, a bond program under the Shelf Registration scheme on the Japanese market with a ceiling of ¥200 billion and a NEU CP program for a ceiling of €2.5 billion as of December 31, 2019.

RENAULT SA RATINGS Agency

Rating/Perspective

Revision

Previous rating/Perspective

Moody’s

Ba1 / NP / Stable Outlook

02/18/2020

Baa3 / P-3 / Stable Outlook

BBB- / A-3 / Credit Watch with Negative implications

S&P

02/19/2020 02/28/2020 11/8/2018

BBB- / A-3 / Negative Outlook BBB / NR / Negative Outlook

Fitch

BBB- / NR / Negative Outlook

R&I JCR

A- / Stable Outlook A- / Stable Outlook

BBB+ / Positive Outlook A- / Positive Outlook

9/4/2019

This risk is monitored or centralized within the Financing and Treasury department of the Automotive division. Foreign currency transactions are mainly carried out by Renault Finance for currencies tradable on international markets. Operating margin: this is the main exposure to foreign exchange risk of the Automotive division. The Group estimates that, based on the structure of its results and its operating cash flows for 2019, a 1% appreciation in the euro against all other currencies would have an impact of -€43 million on its annual operating margin, before any hedging. These hedges require formal authorization from the Finance Department or Senior Management, and the results are then reported to Senior Management.

Foreign exchange risk Exchange rate fluctuations may have an impact on six Group financial aggregates (see note 25-B2 to the consolidated financial statements): operating margin; P working capital requirement (WCR); P financial income; P share in the net income of associated companies; P shareholders’ equity; P net cash position. P

Nominal amounts valued at December 31, 2019 in € millions (1)

106 GROUPE RENAULT I UNIVERSAL REGISTRATION DOCUMENT 2019

Find out more at www.groupe.renault.com