QUADIENT - 2019 Universal Registration Document

FINANCIAL STATEMENTS Consolidated financial statements

The difference between the lease commitments on future minimum payments on real estate leases presented as of 31 January 2019 in accordance with IAS 17 and the lease obligation at 1 st February 2019 measured according to IFRS 16 is explained as follows:

Commitments on real estate leases at 31 January 2019

91.4

Impacts related to changes in scope

0.2

Car rentals

9.2

Impact of discounting of leases contracts

(9.4)

LEASE OBLIGATION AT 1 FEBRUARY 2019

91.4

The average discount rate for lease liabilities at the transition date is 2.75 % .

FIRST APPLICATION OF IFRIC 23

retirement benefit obligations, deferred taxes, goodwill, some provisions and the useful life of fixed assets. These estimates and assessments are reviewed regularly on the basis of actual experience and various other factors considered reasonable, which form the basis of the measurement of book value for assets and liabilities. Actual outcomes might differ substantially from these estimates if different assumptions or conditions are applied.

IFRIC 23 - Uncertainty over income tax treatments has been adopted by the European Union in October 2018 and becomes mandatory for annual periods beginning on or after the 1 January 2019. This interpretation clarifies the application of the standard IAS 12 - Income Taxes regarding the recognition and the measurement of the income tax, when there is uncertainty over the income tax treatments. The Group applied IFRIC 23 as of 1 February 2019, after having conducted an analysis within its subsidiaries, in order to identify and list the tax uncertainties under IFRIC 23. The application of this interpretation, had no significant impact on the financial statements of the Group. Standards, amendments and interpretation adopted by the European Union, that are mandatory for financial years beginning on or after 1 January 2020, and that have not been early adopted by the Group: amendments to IAS 1 and IAS 8: Definition of "material"; ● amendments to IAS 39, IFRS 7 and IFRS 9 about the ● interest rate benchmark reform. Standards, amendments and interpretations published by the IASB but not yet adopted by the European Union: amendment to IFRS 3: Definition of a business. ●

2-3: Foreign currency payables and receivables

Transactions in foreign currencies are recorded at the exchange rate in force on the date of the transaction. All assets and liabilities denominated in foreign currencies are translated at the year-end exchange rate in force at closing. The resulting gains and losses are recognized in the income statement, with the exception of variances on loans or borrowings which form part of the net investment in a foreign entity. These are booked directly under shareholders’ equity until divestment.

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2-4: Translation of financial statements denominated in foreign currencies

The operating currency for each of the Group’s entities is the currency of the economic environment in which that entity operates. Financial statements of subsidiaries operating outside France, which are presented in local currencies, are translated into euros – the currency used in the Group’s financial statements – at the year-end exchange rate. Income statement and cash flow statement are translated at the average exchange rate over the period. The resulting translation variance is recognized in the translation adjustment reserve under shareholders’ equity.

2-2: Use of estimates

In order to prepare this financial information, Quadient has made estimates and used assumptions that may affect the amounts presented under assets and liabilities, as well as the amounts presented under income and expenses for the year. The main material estimates and assumptions made when preparing the financial statements relate in particular to

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UNIVERSAL REGISTRATION DOCUMENT 2019