PSA_GROUP_REGISTRATION_DOCUMENT_2017

ANALYSIS OF THE BUSINESS AND GROUP OPERATING RESULTS IN 2017 AND OUTLOOK Financial position and cash

Detail of Free Cash Flow of manufacturing and sales 4.2.2. companies

The Free Cash Flow of manufacturing and sales companies is defined in Note 16 to the consolidated financial statements at 31 December 2017. The Free Cash Flow generated over the period amounted to €500 million, including a €129 million contribution from Faurecia. The Free Cash Flow over the period mainly stemmed from: €5,823 million in cash flows generated by recurring operations of „ which a contribution of €(336) million of OV; €(618) million in cash flows related to restructuring plans „ including €(12) million for OV; €8 million improvement in the working capital requirement, „ including €1,179 million in trade payables, (€ 476) million in trade receivables, and €(167) million in inventories. New vehicle inventory levels are presented below ; OV contribution amounts to €(610) million ;

€(4,277) million in capitalised capital expenditure and research & „ development, including Faurecia's share which represented €(1,214) million and the share of OV which represented €(509) million at 31 December 2017 and of which €(436) million in exceptional investments/asset disposals, including Faurecia’s share which represented €(218) million at the end of 2017. Total research and development expenses incurred increased in 2017 compared to 2016 and are presented in Note 5 to the consolidated financial statements at 31 December 2017.

New vehicle inventory levels for PCD and in the independent PCD dealer network:

31 December 2017

31 December 2016

31 December 2015

(in thousands of new vehicles)

Group

97

99

107 243 350

Independent dealer network

319 416

307 406

TOTAL

New vehicle inventory levels for OV and in the independent OV dealer network:

31 December 2017

31 December 2016

31 December 2015

(in thousands of new vehicles)

Group

135 129

NA NA NA

NA NA NA

Independent dealer network

TOTAL

264

Excluding Free Cash Flow, the changes in net financial position as the dividends paid to Faurecia minority shareholders for €(129) represented €(1,119) million. These are mainly related to dividends million and to the exercise of warrants in the amount of €288 million paid to Group shareholders in the amount of €(431) million as well as well as €(662) million of OV debt consolidation.

Liquidity and funding of finance companies 4.2.3.

The liquidity and funding of finance companies are discussed in Notes 13.4 and 13.5 to the consolidated financial statements at 31 December 2017.

Provisions for warranties 4.2.4.

Please refer to Note 10 to the consolidated financial statements at 31 December 2017.

Pensions and other post-employment benefits 4.2.5.

Please refer to Note 7.1 to the consolidated financial statements at 31 December 2017.

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GROUPE PSA - 2017 REGISTRATION DOCUMENT