NEOPOST - 2018 Registration document

6

Financial statements

Consolidated financial statements

Shareholders’ equity and earnings per share Note 13

13-1:

Shareholders’ equity

Dividend per share 13-1-5: Consolidated retained earnings before appropriation of 2018 net income of the parent company amounted to 294.8 million euros as at 31 January 2019 compared with 246.9 million euros as at 31 January 2018. A dividend of 0.53 euro should be paid, subject to the 28 June 2019 General Annual Meeting’s approval, in relation to the 2018 financial results, corresponding to a 20% payout ratio. If approved, the dividend will be paid in cash and in one instalment on 6 August 2019. The dividend paid in 2017 was 1.70 euro of which 0.80 euro was prepaid on 6 February 2018. Equity instruments acquired by the Company are deducted from shareholders’ equity. No gain or loss is recognized in the income statement on the purchase, sale, issue or cancellation of instruments representing shareholders’ equity. As at 31 January 2019, the Group held 152,142 shares within the framework of the liquidity contact and 8,349 shares for the purposes of fulfilling the commitments on the stock-option and free share attribution programs reserved for employees and Group executives. This compares with 153,027 and 10,761 respectively as at 31 January 2018. Under the liquidity contract, shares cannot be sold freely by Neopost unless the contract is cancelled. This contract was signed in accordance with the French association of investment companies (AFEI) code of ethics, with Exane BNP Paribas. Liquidity contract and share buyback 13-1-6: program

Share capital 13-1-1: At 31 January 2019, the share capital totaled 34.6 million euros divided into 34,562,912 ordinary shares with a par value of 1 euro each. The share capital is fully released. 13-1-2: Additional paid-in capital represents the net amount received by the Company in excess of the par value on issuance, fully distributable. As at 31 January 2019, additional paid-in capital amounted to 52.9 million euros stable on 31 January 2018. 13-1-3: This item mainly comprises cumulated net income over the years, as well as dividend payments and the delivery of free shares. 13-1-4: Financial statements of subsidiaries established in local currencies are translated into euros at the year-end exchange rate. Income and expenses are translated at the average exchange rate over the period. The resulting translation difference is recognized in the translation adjustment reserve under shareholders’ equity. Cumulative translation adjustments as at 31 January 2019 amounted to (23.2) million euros compared with (48.6) million euros at 31 January 2018. Additional paid-in capital Reserves and retained earnings Cumulative translation adjustments

Free shares delivery

Number of shares

31 January 2018

Bought

Sold

31 January 2019

Liquidity contract

153,027

504,779

(505,664)

-

152,142

Share-based payments

10,761

-

-

(2,412)

8,349

13-2:

Equity instruments issued

Equity management 13-1-7: In terms of equity management, the Group’s objective is to maintain business continuity in order to generate a return for shareholders and to optimize the cost of capital. The Group manages its capital structure in relation to economic conditions, and can adjust the amount of dividends and share buybacks accordingly. 13-1-8: Neopost carried out an analysis of its shareholder base as at 31 January 2019. No shareholder holding more than 3% of share capital has significant business dealings of any kind with Neopost. Information on investors

ODIRNANE issue 13-2-1: On 16 June 2015, Neopost S.A. issued a senior unsecured net share settled undated bond convertible into new shares and/or exchangeable for existing shares (ODIRNANE) for a notional amount of 265 million euros representing 4,587,156 shares with a nominal value of 57.77 euros. This bond is traded on the open market Freiverkehr of the Frankfurt stock exchange. Following the 0.80 euro dividend paid out on 6 February 2018, the ratio has been adjusted to 1.301 from 3 August 2018. As at 31 January 2019, the amount of accrued coupons represents 1.1 million euros and is booked as current debt.

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REGISTRATION DOCUMENT 2018 / NEOPOST