Groupe Renault - 2019 Universal Registration Document

RENAULT: A RESPONSIBLE COMPANY

ANNUAL GENERAL MEETING OF RENAULT ON APRIL 24, 2020

FINANCIAL STATEMENTS

GROUPE RENAULT

CORPORATE GOVERNANCE

RENAULT AND ITS SHAREHOLDERS

ADDITIONAL INFORMATION

CONSOLIDATED FINANCIAL STATEMENTS

The Automotive (excluding AVTOVAZ) segment’s interest rate risk management policy applies two principles: liquidity reserves are generally established using floating-rate P financing: the Automotive segment’s available cash is managed centrally by Renault SA as far as possible and invested in short-term bank deposits by Renault Finance; long-term investments generally use fixed-rate financing. P Fixed-rate borrowings remain at fixed rates as long as the rate curve is close to zero, or even negative. The ratio of liquidity reserve hedging by floating-rate debts is monitored monthly. The financing in yen undertaken as part of the partial hedge of Nissan equity is fixed-rate. Finally, Renault Finance carries out interest rate transactions on its own behalf, within strictly defined risk limits, and positions are monitored and valued in real time. The risk associated with this arbitrage activity is very limited, and has no significant impact on the Group’s consolidated net income. Interest rate hedging instruments for the Automotive (excluding AVTOVAZ) segment are standard interest swaps that are adequately covered by hedged liabilities, such that no ineffectiveness is expected. The Automotive (excluding AVTOVAZ) and Sales Financing segments made no major changes to their interest rate risk management policy in 2019. ANALYSIS OF FINANCIAL INSTRUMENTS’ SENSITIVITY TO INTEREST RATE RISKS The Automotive (excluding AVTOVAZ) and Sales Financing segments are exposed to the following interest rate risks: variations in the interest flows on floating-rate financial P instruments stated at amortized cost (including fixed-rate instruments swapped to floating rate, and structured products); variations in the fair value of the fixed-rate financial instruments P stated at fair value; variations in the fair value of derivatives. P

Impacts are estimated by applying a 100 base point rise in interest rates over a one-year period to financial instruments reported in the closing statement of financial position. For the Sales Financing segment, the impact on shareholders’ equity corresponds to the change in fair value before reclassification in profit or loss (section 4.2.2) of fixed rate debt instruments classified as financial assets at fair value through other components of comprehensive income and cash flow hedges after a 100 base point rise in interest rates. All other impacts affect net income. Calculation of the individual segments’ sensitivity to interest rates includes intersegment loans and borrowings. For the Automotive (excluding AVTOVAZ) segment, the impact on net income and shareholders’ equity (before taxes) of a 100 base point rise in interest rates applied to financial instruments exposed to interest rate risks would be a positive €102.1 million and €0.2 million respectively at December 31, 2019. For the Sales Financing segment, the overall sensitivity to interest rate risks in 2019 remained below the limit set by the RCI Banque group (€50 million at December 31). At December 31, 2019, a 100 point base point rise in interest rates would have the following impacts on net income and shareholders’ equity (before taxes): +€0.9 million for items denominated in pounds sterling; P +€0.5 million for items denominated in Korean won; P +€0.2 million for items denominated in Polish zloty; P -€0.2 million for items denominated in Czech korunas; P -€0.5 million for items denominated in Brazilian real; P -€0.8 million for items denominated in Swiss francs; P -€1.0 million for items denominated in euros. P The sum of the absolute sensitivities in each currency amounts to €4.5 million.

04

FIXED RATE/FLOATING RATE BREAKDOWN OF FINANCIAL LIABILITIES AND SALES FINANCING DEBTS OF THE GROUP (EXCLUDING AVTOVAZ), AFTER THE EFFECT OF DERIVATIVES

December 31, 2019

December 31, 2018

(€ million)

Financial liabilities before hedging: fixed rate (a) Financial liabilities before hedging: floating rate (a’)

35,503 21,970 57,473

27,006 24,621 51,627

Financial liabilities before hedging (without redeemable shares) of the Group (excluding AVTOVAZ)

Hedges: floating rate/fixed (b) Hedges: fixed rate/floating (b’)

8,631 8,758

9,844 7,702

Hedges

17,389 35,376 22,097 57,473

17,546 29,148 22,479 51,627

Financial liabilities after hedging: fixed rate (a+b-b’) Financial liabilities after hedging: floating rate (a’+b’-b)

Financial liabilities after hedging (without redeemable shares) of the Group (excluding AVTOVAZ)

405

GROUPE RENAULT I UNIVERSAL REGISTRATION DOCUMENT 2019