Groupe Renault - 2019 Universal Registration Document

04

CONSOLIDATED FINANCIAL STATEMENTS FINANCIAL STATEMENTS

Counterparty and credit risks C2 At December 31, 2019, the AVTOVAZ Group has €67 million in cash and cash equivalents and €250 million of trade receivables and other current assets subject to potential credit risk. Credit risk on these financial assets arises from default of the counterparty, with maximum exposure equal to the carrying amount. The AVTOVAZ Group trades only with recognized, creditworthy third parties. The AVTOVAZ Group’s policy states that all customers requiring credit facilities must be subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis, and as a result, the AVTOVAZ Group’s exposure to bad debts is not significant. The maximum exposure is the carrying amount. There are no significant concentrations of credit risk within the AVTOVAZ Group.

Liquidity risks C3 The AVTOVAZ Group monitors its risk to a shortage of funds using a liquidity planning tool. This tool considers the maturity of both its financial investments and financial assets ( e.g. accounts receivable, other financial assets) and projected cash flows from its operations. The AVTOVAZ Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank loans and borrowings. The maturity of the AVTOVAZ Group’s financial liabilities at December 31, 2019 is presented in note 23-D. Cash flow and Interest rate risk C4 The AVTOVAZ Group’s interest rate risk principally results from its sources of financing. At December 31, 2019, the AVTOVAZ Group has €583 million of floating-rate debts to credit institutions and €338 million of fixed-rate debts to credit institutions (note 23). It has not entered into any hedging arrangements in respect of its interest rate exposures. The AVTOVAZ group’s financial assets bear interest at fixed rates or do not bear interest.

Cash flows and other information

4.2.6.6

CASH FLOWS NOTE 26 Other income and expenses with no impact on cash before interest and tax 26 – A –

2019

2018

(€ million)

Net allocation to provisions

(115)

204

Net effects of sales financing credit losses

67 23 33

63

Net (gain) loss on asset disposals

(69)

Change in fair value of other financial instruments

22

Net financial indebtedness

311 828 626 164

308

Deferred taxes Current taxes

33

690 145

Other

OTHER INCOME AND EXPENSES WITH NO IMPACT ON CASH BEFORE INTEREST AND TAX

1,937

1,396

Change in working capital 26 – B –

2019

2018

(€ million)

Decrease (increase) in net inventories

165 390 155

240 283 (39)

Decrease (increase) in Automotive net receivables

Decrease (increase) in other assets Increase (decrease) in trade payables Increase (decrease) in other liabilities

(161)

(240)

665

307 551

INCREASE (DECREASE) IN WORKING CAPITAL BEFORE TAX

1,214

Capital expenditure 26 – C –

2019

2018

(€ million)

Purchases of intangible assets

(2,086) (3,035) (5,121)

(1,772) (2,745) (4,517)

Purchases of property, plant and equipment (other than assets leased to customers)

TOTAL PURCHASES FOR THE PERIOD

Deferred payments

99

110

TOTAL CAPITAL EXPENDITURE

(5,022)

(4,407)

408 GROUPE RENAULT I UNIVERSAL REGISTRATION DOCUMENT 2019

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