LEGRAND_REGISTRATION_DOCUMENT_2017

05 MANAGEMENT REPORT

ON THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED DECEMBER 31, 2017

5.1 – PRELIMINARY DISCLAIMER

138

5.2 – 2017 HIGHLIGHTS

138

5.3 – OPERATING INCOME

142

5.3.1 – Introduction

142 142

5.3.2 – Main factors affecting Group results

5.4 – YEAR-ON-YEAR COMPARISON: 2017 AND 2016

145

5.4.1 – Net sales 5.4.2 – Cost of sales

146 148 148 149 149 149 150 150 150 151 151

5.4.3 – Administrative and selling expenses 5.4.4 – Research and development costs 5.4.5 – Other operating income and expenses

5.4.6 – Operating profit

5.4.7 – Adjusted operating profit 5.4.8 – Net financial expenses 5.4.9 – Exchange gains and losses

5.4.10 – Income tax expense

5.4.11 – Net profit attributable to the Group 5.5 – CASH FLOWS AND BORROWING

152

5.5.1 – Cash flows

152 153

5.5.2 – Debt

5.6 – CAPITAL EXPENDITURE

153

5.7 – OFF BALANCE SHEET COMMITMENTS

153

5.8 – CONTRACTUAL OBLIGATIONS

154

5.9 – VARIATIONS IN EXCHANGE RATES

154

5.10 – QUANTITATIVE AND QUALITATIVE DISCLOSURES RELATING TO FINANCIAL RISKS

155

5.11 – SUMMARY OF CRITICAL ACCOUNTING POLICIES

155

5.12 – NEW IFRS PRONOUNCEMENTS

156

5.13 – TRENDS AND PROSPECTS

156

5.14 – TABLE OF CONSOLIDATED FINANCIAL RESULTS OVER THE LAST FIVE YEARS

157

5.15 – SELECTED FINANCIAL INFORMATION

158

137

REGISTRATION DOCUMENT 2017 - LEGRAND