PSA - 2019 Universal Registration Document

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2019 Notes to the Consolidated Financial Statements at 31 December 2019

Other assets In addition,the researchand development individualassetsheld by the fully consolidated companies of the Peugeot Citroën DS businesssegmentanddedicatedto theChineseactivitieshavebeen impairedby €173 millionin 2019, in additionto €78 millionin 2018 and€80 million in2017. At 31 December2019, the analysesof the volumesand profitability forecastsdidnot revealany indicatorsof impairmentfor the specific assets dedicated to theVehicles. Impairment test on Faurecia Group CGUs C. and other assets Faurecia Group CGUs The carryingamountof eachCGUwas comparedwiththe higherof its fair valueand value in use. Valuein use is definedas the present value of estimatedfuture cash flows expectedto be generatedby each cash-generatingunit basedon the latest projectionsfrom the Medium-Term Plan (2020–2022 plan revised at mid-2019).

Themainassumptionaffectingvalue in use is the level of operating income, particularly for the calculation of terminal value. The calculationwas performed by extrapolatingto infinity projected cashflowsfor the last yearof theMedium-TermPlan(2022)usinga growth rate of 1.4% (1.4% in2018and2017). The weightedcost of capital used to discountfuture cash flows is reviewedeach year by an independentexpert,and is set at 9% for 2019 (the same as 2017 and 2018) for all the CGUs, exceptClarion. They all bear the same specific risks relating to the automotive supplier sector and the CGUs multinationaloperation does not justify using geographicallydifferent discount rates except for Clarion Electronics, for which a discount rate of 8% has been considered to take into account a slightly different country exposure. The test performed at end-2019 confirmed that the goodwill allocatedto the CGUswas fairlystatedin the statementof financial position.The statementof financialposition’svalues are presented in the tablebelow:

31 December 2019 31 December 2018 31 December 2017

(in million euros)

Seating >

850 465 295 536

843 377 272

794 355

Clean Mobility > Interior Systems >

67

Clarion Electronics (1) >

-

-

TOTAL 1,216 Following the acquisition of Clarion in March 2019, the Faurecia Group now has a fourth operational unit which combines the activities of (1) electronic smart cockpit and software integration. 2,146 1,492

Faurecia CGU in the accounts of Groupe PSA The stockmarketvalueof the Faureciasharesheldby PeugeotS.A. at 31 December2019 was €3,072 million(€2,115 millionin 2018 and €4,166 million in 2017) based on a share price of €48.03, representingthe price that wouldbe paid in a transactionbetween minorityshareholdersnot leadingto the acquisitionof control.The Group’sshareof Faurecia’snet assetsin the consolidatedstatement of financialpositionis valuedat € 2,043 million (includinga goodwill of €172 million recordedat Peugeot S.A.). In light of these values,no impairmentloss was recognisedon the Faurecia goodwill at 31 December 2019. Applying the same approach, no impairment loss was recognized on the Faurecia goodwill at 31 December 2018 and31 December 2017.

The recoverableamountof the assetsis greaterthan their carrying value,and the combinedsensitivityto changesin assumptions(0.5 percentagepointincreasein the discountrate,0.5 percentagepoint reduction in the perpetualgrowth rate and 0.5 percentagepoint reductionin the perpetualoperatingincome) did not trigger any impairment of goodwill. Following the US withdrawal from the JCPOA (1) announced on 8 May2018,theGroupcompliedwiththe newapplicableregulations by suspendingits operationsin Iran affectedby the sanctions.In this context, Faurecia impairedvarious assets used in business in Iranfor a total amount of €17 million in 2018.

OFF-BALANCE SHEET COMMITMENTS AND CONTINGENT LIABILITIES RELATED 8.4. TO OPERATING ACTIVITIES

31/12/2019

31/12/2018

31/12/2017

(in million euros)

Capital commitments for the acquisition of non-current assets

1,405

1,350

1,284

Orders for research and development work Minimum purchase commitments Non-cancellable lease commitments (1)

11

10

22

-

-

173

301

1,809 3,169

1,867 3,346

TOTAL

1,717

IFRS 16 impact (see Note 2.3). (1)

Joint Comprehensive of Action Plan signed in Vienna. (1)

209

PSA - GROUPE PSA - 2019 UNIVERSAL REGISTRATION DOCUMENT