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

4.6.3 Changes in long-term and short-term borrowings Changes in long-term and short-term borrowings can be analyzed as follows:

Variations not impacting cash flows

Translation adjustments

December 31, 2018 Cash flows

Acquisitions Reclassifications

Other

December 31, 2017

(in € millions)

Long-term borrowings

2,918.6

420.0

2.6

(5.0)

15.7

28.2

2,457.1

Short-term borrowings

400.5

(156.3)

4.4

5.0

0.2 (38.2)

585.4

GROSS FINANCIAL DEBT

3,319.1

263.7

7.0

0.0

15.9 (10.0)

3,042.5

4.7 DEFERRED TAXES In accordance with IAS 12, deferred taxes are recognized for temporary differences between the tax bases of assets and liabilities and their carrying amount in the consolidated balance sheet. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled.

Deferred tax assets and deferred tax liabilities are offset when the entity has a legally enforceable right of offset and they relate to income taxes levied by the same taxation authority. Deferred tax assets are recognized to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. The recognized deferred tax assets are expected to be utilized no later than five years from the period-end.

Deferred taxes recorded in the balance sheet result from temporary differences between the carrying amount of assets and liabilities and their tax base and can be analyzed as follows:

December 31, 2018

December 31, 2017

(in € millions)

Deferred taxes recorded by French companies

(220.6)

(222.9)

Deferred taxes recorded by foreign companies

(372.6)

(294.2)

TOTAL

(593.2)

(517.1)

Origin of deferred taxes: W Impairment losses on inventories and receivables

54.7

49.5

W Margin on inventories

23.1

22.0

W Recognized operating losses carried forward

9.8

8.4

W Finance leases

(3.1)

(3.3)

8

W Fixed assets

(205.4)

(166.9)

W Trademarks

(445.8)

(441.1)

W Patents

(9.9)

(7.0)

W Other provisions

(9.1)

22.9

W Pensions and other post-employment benefits

31.1

31.7

W Fair value adjustments to derivative instruments

(0.9)

(1.0)

W Other

(37.7)

(32.3)

TOTAL

(593.2)

(517.1)

W of which deferred tax assets

107.8

104.0

W of which deferred tax liabilities

(701.0)

(621.1)

293

LEGRAND

REGISTRATION DOCUMENT 2018