HERMÈS - 2018 Registration document

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Consolidated financial statements Notes to the consolidated financial statements

EQUITY

NOTE 21

Asat31December2018,HermèsInternational’ssharecapitalconsisted of 105,569,412 fully paid-up shares with a par value of €0.51 each, of which 1,317,379 treasury shares. Infinancialyear2018,thefollowingtreasurysharemovementsoccurred: s s buyback of 103,237 shares for €59.4 million, excluding movements under the liquidity contract; s s purchase and sale of shares as part of the liquidity agreement, for €0.3 million; s s delivery of 201,560 free shares allotted toHermèsGroupemployees. It is specified that no shares are reserved for issuance under put options or agreements to sell shares. For management purposes, theHermès Group uses the notion of “equity attributable to owners of the parent” as shown in the consolidated sta- tement of changes in equity. More specifically, equity includes the reva- luation of financial instruments as well as actuarial gains and losses, as defined in Notes 1.9 and 1.18. The Group’s objectives, policies and procedures in the area of capi- tal management are in keeping with sound management principles designed to ensure that operations are well-balanced financially and to minimise the use of debt. As its surplus cash position gives it some flexi-

bility, the Group does not use prudential ratios such as “return on equity” in its capital management. During the current year, the Group made no change in its capital management policy and objectives. Lastly, the parent company, Hermès International, is governed by French laws on capital requirements. Equity must be greater than or equal to at least half of the share capital. If it drops below this level, an Extraordinary General Meeting must be called to approve the measures required to remedy this situation. Hermès International has never been in this posi- tion and has always met this requirement. 21.1 Dividends The General Meeting of 5 June 2018, called to approve the financial sta- tements for the year ended 31 December 2017,approved the payment of an ordinary dividend of €4.10 and an extraordinary dividend of €5.00 per share for the year. Taking into account the interim cash dividend of €1.50 per share paid on 22 February 2018, a cash balance of €7.60 was paid on 12 June 2018. The total amount of ordinary and exceptional dividends thus paid amounted to €948.7 million.

21.2 Foreign currency adjustments

The change in foreign currency adjustments in the financial year is analysed below:

31/12/2018

31/12/2017

In millions of euros

Balance as at 1 January

13.8 16.7 30.1

163.3 (15.8) (64.0)

Yen

US dollar

Yuan

4.5

(6.2) (1.0) (8.0) (7.7)

Rouble

(1.6) (0.4)

Pound sterling Macao pataca

2.5 3.9

Swiss franc

(10.2) (10.9) (30.1)

Singapore dollar Hong Kong dollar Other currencies

14.1 13.4 (9.0) 87.9

4.4

Balance at end of period

13.8

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2018 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL