Hermès // 2021 Universal Registration Document

5

CONSOLIDATED FINANCIAL STATEMENTS NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Adjusted free cash flow 2.4 For management purposes, the Hermès Group sees all lease payments as items affecting operating activities. IFRS 16 considers fixed lease payments as the sum of the repayment of the principal portion of the lease liability and the payment of financial interests. Consequently, the Group follows the following APM:

adjusted free cash flow: corresponds to the cash flows related to s operating activities, less operating investments and the repayment of lease liabilities recognised in accordance with IFRS 16 (aggregates in the consolidated statement of cash flows).

The reconciliation of this indicator with the Group’s statement of consolidated cash flows presented in section 5.5 is as follows:

2021

2020

In millions of euros

Operating cash flows

3,060

1,993 (350) (448) (199)

+ Change in working capital requirements

346

- Operating investments

(532) (212) 2,661

- Repayment of lease liabilities ADJUSTED FREE CASH FLOW

995

SEGMENT INFORMATION

NOTE 3

Accounting principles

Given the Group’s current structure, organised into geographical areas that the geographical areas constitute the operating segments with placed under the responsibility of operational Senior Executives in reference to the fundamental principle of IFRS 8.

charge of applying the strategy defined by the Executive Committee (the principal operational decision-maker), the Group has determined

Segment information is presented after eliminations and restatements.

Revenue by destination geographical area breaks down as follows:

France €838M

Other €156M

Americas €1 458M

Europe (excl. France) €1,303M

Japan €977M

Asia-Pacific (excl. Japan) €4,251M

368 2021 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL