HERMÈS - 2020 Universal registration document

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CONSOLIDATED FINANCIAL STATEMENTS NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

ANALYSIS OF THE MAIN CHANGES IN THE SCOPE OF CONSOLIDATION

NOTE 2

In July 2020, as part of the strengthening of its vertical integration strategy, Hermès acquired 100% of J3L, specialising in metal parts dedicated to leather goods and fashion accessories. Hermès previously held a 30% stake in the share capital of this long-standing supplier to the Group. On 23 December 2020, Exor’s investment in Shang Xia through a reserved capital increase, allowed it to become the majority shareholder in this company. As of this date, Shang Xia was deconsolidated, resulting in €91 million in non-recurring income for Hermès. Due to the non-material nature of Shang Xia's activity, this transaction did not give rise to the preparation of pro forma financial information.

ALTERNATIVE PERFORMANCE MEASURES

NOTE 3

This Note aims to present the main alternative performance measures (“APM”) followed by the Group Management, and their reconciliation, where appropriate, with the aggregates of the IFRS consolidated financial statements.

Revenue growth at constant exchange rates 3.1 Revenue growth at constant exchange rates: calculated by applying, for each currency, the average exchange rates of the previous period to the s revenue for the period.

2020 at current rates

2020 at constant rates

Change at current exchange rates

Change at constant exchange rates

2019

Currency effect

Revenue In millions of euros

6,389.4

6,469.0

6,883.4

(494.0)

(414.4)

(79.6)

Change in%

(7.2)%

(6.0)%

(1.2)%

Recurring operating income 3.2 Recurring operating income: operating income exclusive of non-recurring items with a significant impact that may affect understanding of the s Group’s economic performance. Net cash position and restated net cash position 3.3 Net cash position: includes cash and cash equivalents presented under balance sheet assets, less bank overdrafts which appear under short-term s borrowings and financial liabilities on the liabilities side. Net cash position does not include lease liabilities recognized in accordance with IFRS 16. Restated net cash position: corresponds to net cash position plus cash investments that do not meet the IFRS criteria for cash equivalents due in s particular to their original maturity of more than three months, less borrowings and financial liabilities. Borrowings and financial liabilities on the balance sheet break down as follows:

2020 16.4

2019 12.6

In millions of euros Bank overdrafts

Other financial liabilities

8.3

8.9

Commitments to buy out minority interests

18.2 42.9

28.7 50.2

BORROWINGS AND FINANCIAL LIABILITIES ON THE BALANCE SHEET

368 2020 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL