QUADIENT - 2020 Universal Registration Document

FINANCIAL STATEMENTS Consolidated financial statements

4-4-3: OFF-BALANCE SHEET COMMITMENTS RELATING TO FINANCIAL ASSETS

Quadient S.A. has an investment commitment with Partech Entrepreneur II for an amount of 0.1 million euros as at 31 January 2021 that has not changed since January 2020.

Impairment test 4-5:

4-5-1: IMPAIRMENT TEST METHOD

Impairment tests compare the recoverable amount of a non-current asset with its net carrying amount. If the asset’s carrying amount is higher than its recoverable amount, it is written down to its recoverable amount. The recoverable amount of an asset or group of assets is the higher of its fair value less disposal costs and its value in use. Fair value less disposal costs is determined using available information to establish the best estimate of the disposal price net of the costs necessary to carry out the sale in an arm’s lengh transaction between knowledgeable, willing parties. Value in use corresponds to the present value of the future cash flows expected to be derived from an asset or group of assets, taking into accounts its residual value. Goodwill Goodwill is tested for impairment at least once a year and whenever there is any evidence of impairment. Goodwill is tested for impairment at the level of the Cash Generated Units (CGU) or group of CGUs defined by the Group. A CGU is a business unit generating independent cash flows. Given the fact that having a reliable basis to determine the fair value less reliable costs of an asset or a group of assets is rare, unless otherwise indicated, the Group uses the value in use to measure the recoverable amount of an asset or group of assets. The value in use of each CGU or group of CGUs is determined as follows: the Group projects future cash flows based on ● financial projections over five years. Industrial margins and net assets are reallocated to the

countries where the equipment in question is installed and leasing margins and net assets are reallocated to the countries where the signatories of finance lease contracts are located. Costs for support incurred (holding, IT, human ressources…) are reallocated to the Group’s CGU or group of CGUs on the basis of their revenue; beyond this explicit time frame, the terminal value is ● calculated by applying a perpetuity growth rate to the latest cash flow; the cash flows are then discounted. The discounting ● rates are determined according to the business and the geographical area considering, if necessary, a specific risk premium. Goodwill impairment is recognized under operating Other tangible and intangible fixed assets are tested for impairment only if evidence of an impairment is noted. A loss of value related to any other asset except goodwill can be reversed if there is any evidence that a loss of value previously recognized is likely to no longer exist or to have diminished. If this is the case, the book value of the asset is raised to the level of its recoverable amount. The increased book value following reversal of a loss of value cannot exceed the book value that would have been determined, net of depreciation, if no loss of value had been recognized on the asset in previous years. After recognition of a reversal of loss of value, the depreciation charge is adjusted for future periods so that the revised book value of the asset minus its possible residual value is spread systematically over the remaining useful life of the asset. expenses. Such impairment is not reversible. Other tangible and intangible fixed assets

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4-5-2: GOODWILL IMPAIRMENT TEST

The global health and economic crisis related to the pandemic COVID-19 is considered as an indicator of impairment as at 31 January 2021. An impairment test of the goodwill has been realized.

Goodwill is tested for impairment based on value in use.

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UNIVERSAL REGISTRATION DOCUMENT 2020