LEGRAND / 2018 Registration document

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CONSOLIDATED FINANCIAL INFORMATION CONCERNING THE GROUP’S ASSETS, LIABILITIES, FINANCIAL POSITION AND RESULTS

CONSOLIDATED FINANCIAL STATEMENTS IN ACCORDANCE WITH IFRS FOR THE YEARS ENDED DECEMBER 31, 2018 AND DECEMBER 31, 2017

4.5

PROVISION FOR POST-EMPLOYMENT BENEFITS AND OTHER LONG-TERM EMPLOYEE BENEFITS

at the balance sheet date, less the fair value of plan assets. The past service cost arising from changes to pension benefit plans is expensed in full as incurred. In accordance with IAS 19, the Group recognizes all actuarial gains and losses outside profit or loss, in the consolidated statement of comprehensive income. Defined benefit obligations are calculated using the projected unit credit method. This method takes into account estimated years of service at retirement, final salaries, life expectancy and staff turnover, based on actuarial assumptions. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of investment grade corporate bonds that are denominated in the currency in which the benefits will be paid and have terms to maturity approximating the period to payment of the related pension liability. Some Group companies provide post-employment healthcare benefits to their retirees. Entitlement to these benefits is usually conditional on the employee remaining with one of these Group companies up to retirement age and completion of a minimum service period. These benefits are treated as post-employment benefits under the defined benefit scheme.

4.5.1

Pension and other post-employment benefit obligations

Group companies operate various pension plans. The plans are funded through payments to insurance companies or trustee- administered funds, determined by periodic actuarial calculations. The Group has both defined contribution and defined benefit plans. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Contributions are recognized as an expense for the period of payment. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in current and prior periods. A defined benefit plan is a pension plan that defines an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and end-of-career salary. The liability recognized in the balance sheet for defined benefit pension plans is the present value of the defined benefit obligation

Pension and other post-employment defined benefit obligations can be analyzed as follows:

December 31, 2018

December 31, 2017

(in € millions)

France (Note 4.5.1.2)

85.4

90.5

Italy (Note 4.5.1.3)

35.4

38.1

United Kingdom (Note 4.5.1.4)

99.9

100.4

United States (Note 4.5.1.5)

72.5

76.1

Other countries

39.6

38.6

TOTAL PENSION AND OTHER POST-EMPLOYMENT DEFINED BENEFIT OBLIGATIONS

332.8

343.7

The total amount of defined benefit obligations was €332.8 million as of December 31, 2018 (€343,7 million as of December 31, 2017) and is analyzed in Note 4.5.1.1.

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LEGRAND

REGISTRATION DOCUMENT 2018