PSA_GROUP_REGISTRATION_DOCUMENT_2017

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2017 Notes to the consolidated financial Statements at December 2017

Change in net financial position (net debt) B. In 2017, the Group kept up the proactive refinancing strategy and conservative liquidity policy described in Note 12.7.A. In 2017, the manufacturing and sales companies have slightly decreased their net financial position. Net cash from operating activities for the year totalled positive €5,213 million, representing funds from operations of €5,205 million plus the positive impact of a €8 million slight increase in working capital. Changes in working capital are discussed in Note 6.4.A. Investments for the period in property, plant and equipment and intangible assets amounted to €4,020 million. Other net investment and financing needs for the year stood at €1,253 million. This amount includes in particular the payment of €431 million in

dividends to Peugeot S.A. shareholders, €129 million to non-controlling shareholders of Groupe PSA subsidiaries, as well as €774 million in capital increases and acquisitions of consolidated companies and equity interests. Other cash inflows for the period comprised the capital increases following in particular the conversion of equity warrants, for €288 million. These various cash inflows and outflows have resulted in a controlled reduction in the net financial position of €619 million, which breaks down as follows: cash reserves increased by €153 million; „ net debt before cash and cash equivalents increased by „ €43 million as a result of the following variations:

2017

2016

(in million euros)

Increase in borrowings

1,046 (731)

1,262

Repayment of borrowings and conversion of bonds (Increase) decrease in non-current financial assets (Increase) decrease in current financial assets Increase (decrease) in current financial liabilities

(2,921)

169

(70)

(548)

160

107

21

43 (1) 42

(1,548)

Net cash flows with Group finance companies

(443)

TOTAL

(1,991)

FINANCIAL SECURITY 12.4.

The €1,046 million increase in borrowings mainly resulted from the 23 March 2017 issuance of two bonds for €600 million and €100 million by Peugeot S.A., and the €250 million loan arranged on 2 February 2017 by PSA Automobiles S.A. from the European Investment Bank (see Note 12.6.A). Debt repayments in the amount of €731 million include notably (see Note 12.6.A) the repayment by Peugeot S.A. of €304 million in 2012 bonds upon maturity in July 2017. Furthermore, the non-cash changes represented an increase of €729 million in the net debt of the Group.

Financial security is made up of available cash, other readily available financial assets and undrawn credit lines.

€1,241 million (€585 million at 31 December 2016) and €334 million (€503 million at 31 December 2016) in current and non-current financial assets respectively were included in the calculation of financial security, representing a total of €1,575 million (€1,088 million at 31 December 2016).

Notes

31 December 2017

31 December 2016

(in million euros)

Cash and cash equivalents (1)

12.5.C 12.5.B

11,582

11,576

Financial investments

165

110

Current & non current financial assets

1,575

1,088

Total

13,322 3,000

12,774 3,000

Lines of credit (undrawn) – excluding Faurecia

Lines of credit (undrawn) – Faurecia TOTAL FINANCIAL SECURITY

1,200

1,200

17,522 2,849

16,974 2,840

of which Faurecia

Of which €43 million in Argentina (€12 million at 31 December 2016). (1)

203

GROUPE PSA - 2017 REGISTRATION DOCUMENT