QUADIENT - 2019 Universal Registration Document

FINANCIAL STATEMENTS Consolidated financial statements

The results of these tests are presented in the table below for the main CGU or groups of CGUs:

Breaking point

EBITDA average growth rate over 5 years

Weighted average cost of capital

Infinite growth rate

(18.0) % (8.1) % (3.8) % (8.7) % >10.0 %

20.0 % 8.6 % 8.7 % 16.8 %

<(10.0) %

France - Benelux

(4.3) % (5.2) %

United Kingdom -Ireland

Germany-Austria-Switzerland-Italy

<(10.0) %

North America

11.1 %

(0.7) %

Parcel Pending

Additional operations * <(10.0) % * The Additional Operations (AO) group several CGU or groups of CGUs, excluding CGU or groups of CGUs that have been subjected to impairment. 2.5 % 12.6 %

In key assumptions, any reasonably possible change of one parameter at a time can not lead to a recoverable value of CGU or group of CGUs becoming equal to its carrying amount.

NOTE 5

ASSETS HELD FOR SALE

Discontinued operations A discontinued operation is a component operation of an entity that has either been disposed of, or is classified as held for sale and represents a separate major line of business or geographical area of operations, is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations or is a subsidiary acquired exclusively with a view to resale. When the criteria are met, the net income and the cash flow of discontinued operations are presented on a separate line in the consolidated income statements and consolidated statement of cash flow. The Group decides if a discontinued operation forms a separate major line of business or geographical region of operations substantially based on its contribution to the Group financial statements. As at 31 January 2019, assets and liabilities classified as held for sale for respectively 14.4 million euros (7.8 million euros after depreciation) and 5.7 million euros were related to Quadient Data Netherlands and Quadient Data GmbH (former Human Inference, sold at the beginning of February 2019). These companies were part of the Enterprise Digital Solutions cash-generating unit. The goodwill was valuated using the relative fair value method. These assets and liabilities were measured at their fair value: the net book value of assets and liabilities as at 31 January 2019 has been compared to the sale price. This leads to the recognition of a depreciation booked in other operational expenses for an amount of 6.6 million euros.

IFRS 5 “Non-current assets held for sale and discontinued operations” specifies the accounting treatment applicable to assets held for sale and the presentation and disclosure of discontinued operations. Assets held for sale Non-current assets held for sale are presented separately in the statement of financial position as soon as the Group has decided to sell these assets and when the sale is considered to be highly probable. These assets are measured at the lower of the carrying amount and the fair value less costs to sell. When the Group is committed to a sale plan involving loss of control of a subsidiary, all the assets and liabilities of this subsidiary are classified as held for sale, regardless of whether the Group will retain a non-controlling interest in its former subsidiary after the sale. As at 31 January 2020, assets and liabilities classified as held for sale for respectively 23.9 million euros (20.8 million euros after depreciation) and 7.2 million euros are related to ProShip, sold on 28 February 2020. This company was part of the cash-generating unit "Other Solutions". The goodwill has been valuated using the relative fair value method. These assets and liabilities were measured at their fair value: the net book value of assets and liabilities as at 31 January 2020 has been compared to the sale price. This leads to the recognition of a depreciation booked in other operational expenses for an amount of 3.1 million euros.

6

147

UNIVERSAL REGISTRATION DOCUMENT 2019