Hermès // 2022 UNIVERSAL REGISTRATION DOCUMENT

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PRESENTATION OF THE GROUP AND ITS RESULTS SIGNIFICANT EVENTS SINCE THE END OF THE FINANCIAL YEAR

CASH FLOWS AND INVESTMENTS

1.8.2

2022

2021

In millions of euros

Operating cash flows

4,111

3,060

Change in working capital requirements

73

346

Change in net cash position related to operating activities

4,184 (518) (261) 3,404

3,405 (532) (212) 2,661

Operating investments

Repayment of lease liabilities Adjusted free cash flows Investments in financial assets

(21)

(13)

Dividends paid

(852) (116)

(490) (162)

Treasury share buybacks net of disposals (excluding liquidity contract)

Other movements

257

170

CHANGE IN RESTATED NET CASH POSITION Restated net cash position at the end of the period Restated net cash position at the beginning of the period

2,672 9,742 7,070

2,166 7,070 4,904

1.8.3 FINANCIAL POSITION The Group’s consolidated balance sheet at the end of 2022 totalled €17.5 billion compared with €13.8 billion at the end of 2021. Cash accounted for nearly 53% of total assets, and equity, which amounted to €12.5 billion as at 31December 2022, represented 71% of liabilities. The Group has thus consolidated a solid financial structure that allows it to maintain its independence and pursue its long‑term strategy. After taking into account the aforementioned operating investments and the repayments of fixed lease liabilities recognised in accordance with IFRS16, which are considered by the Group as items affecting operating activities, adjusted free cash flows amounted to €3.4 billion against €2.7 billion in 2021. After payment of €852 million in dividends, share buybacks amounting to €116 million and taking into account positive currency appreciation against the euro (included in other movements), the restated net cash position increased by €2.7 billion to reach €9.7 billion at the end of 2022.

Operating cash flows amounted to €4.1 billion, up 34% year‑on‑year, in line with operating income. The change in working capital requirements was a net resource of €73million in 2022. The controlled increase in inventories was offset by the increase in operating liabilities and tax and social security liabilities. Group operating investments amounted to €518 million: €214 million was allocated to the renovation and expansion of the exclusive distribution network, including the construction of the Madison 706 flagship store in New York, inaugurated in September; s €192 million was dedicated to strengthening production capacities, mainly in new leather goods workshops projects but also in the Silk, Perfume and Beauty and Watches métiers ; s €113 million was invested in information systems and digital technology but also in real estate projects to support the Group’s growth. s

1.9 SIGNIFICANT EVENTS SINCE THE END OF THE FINANCIAL YEAR AFR

No such events have occurred since the end of the financial year.

2022 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

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