HERMÈS - 2018 Registration document

Consolidated financial statements Notes to the consolidated financial statements

s s long-service awards in Japan, the Asia-Pacific region, Australia, Switzerland and England: long-service in certain foreign subsidiaries is compensated by the allocation of bonuses on specific anniversary dates;

s s a supplementary plan in France or abroad (Switzerland, Canada).

< 1 year

> 1 year

2018

< 1 year

> 1 year

2017

In millions of euros

Post-employment and similar benefit obligations

6.9 6.9

196.0 196.0

202.9 202.9

6.0 6.0

188.2 188.2

194.2 194.2

TOTAL

26.2 Actuarial assumptions

For 2018, the following actuarial assumptions were used for the countries to which the Hermès Group’s main commitments apply:

France

Italy

Switzerland

Japan

Taiwan

Rest of Asia **

62 to 69.6 years

63 to 64 years

60 to 63 years

60 to 66

Retirement age

62 to 65 years

years 50 to 65 years

Increase in salaries

3.0%

1.2%

2.0%

2.5% 3.5% -5% 3.50% -8.25%

Increase in social security ceiling

2.50%

n/a

n/a

n/a

n/a

n/a

Discounting rate

1.62% -1.20% *

1.6%

0.9%

0.6%

0.9% 0.5% -8.05%

n/a: not applicable. * Rates according to the duration of the plans. ** India, Malaysia, Thailand.

2017 Assumptions:

France

Italy

Switzerland

Japan

Taiwan

Rest of Asia **

5

62 to 69.6 years

63 to 64 years

60 to 63 years

60 to 66

Retirement age

62 to 65 years

years 50 to 65 years

Increase in salaries

3.0%

1.2%

2.0%

2.5% 3.5% -5% 3.50% -8.25%

Increase in social security ceiling

2.50%

n/a

n/a

n/a

n/a

n/a

Discounting rate

1.33% -0.86% *

1.3%

0.7%

0.5%

0.9% 0.2% -7.25%

n/a: not applicable. * Rates according to the duration of the plans. ** India, Malaysia, Thailand.

The discount rates applied are obtained by reference to the yield on investment grade (AA) corporate bonds with the same maturity as that of the obligation. In accordance with IAS 19 revised, rates of return on assets are determined by reference to discount rates on the obligations. A 0.50 point increase or decrease in the discount rate would lead to a €16.4million decrease or a €14.7million increase in Hermès Group’s pension provision respectively, with the balancing entry recognised in equity.

More specifically, for pension plans in Switzerland, a 0.50 point increase or decrease in the applied interest rate would lead to a €1.1million increase or a €1.0 million decrease in the pension provision, with the balancing entry recognised in equity. As at 31 December 2018, contributions paid for the coming year (including contributions paid to a fund and benefits paid directly by the employer) totalled €6.9 million, compared with €5.8 million in 2017.

2018 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

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