Sopra Steria - 2019 Universal registration document

5 2019 CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements

At 31 December 2019, the Group’s gross borrowings broke down as follows by type of debt and currency:

Currency of origin

Pound sterling

Euro

Other

Total 251.6 199.1

(in millions of euros)

Bond

251.6 154.1

-

- - - - - - -

Bank borrowings

45.0

Short-term bank borrowings (< 1 year) NEU CP (commercial paper) & MTN

17.0

7.5

24.4

219.0

- -

219.0

Other sundry financial debt Bank overdrafts (cash liabilities) GROSS FINANCIAL DEBT

12.4

12.4

4.8

0.1

4.9

658.8

52.6

711.4

At 31 December 2019, the Group’s portfolio of investment securities broke down as follows:

Advances under the liquidity agreement

Total portfolio of investment securities

Short-term investments

(in millions of euros)

Net asset value NET POSITION

23.5 23.5

2.4 2.4

25.9 25.9

Short-term investments are managed by the Group’s Finance Department, and comply with internally defined principles of prudence. At constant exchange rates relative to 31 December 2019, and taking into account short-term investments held at that date, a 50-basis-point decrease in floating rates would reduce annual financial income by €0.1 million. Bank counterparty risk 12.5.2. All foreign currency and interest rate hedges are put in place with leading banks belonging to the Group’s banking syndicate, with which market transaction agreements have been signed. The majority of the Group’s financial investments relate to the subsidiaries in India and, from time to time, the Sopra Steria Group parent company. Financial investments are carried out either via short-term bank deposits with banks mainly belonging to the banking syndicate, or via money-market instruments managed by leading financial institutions, which are themselves subsidiaries of banks mainly belonging to the syndicate. These investments are subject to approval by the Group, and comply with internally defined principles of prudence.

Thanks to these various measures, the Group considers that it has implemented a system that significantly reduces its bank counterparty risk in the current economic context. However, the Group remains subject to a residual risk which may affect its performance under certain conditions. Interest rate risk 12.5.3. The Group’s aim is to protect itself against interest rate fluctuations by hedging part of its floating-rate debt and investing its cash over periods of less than three months. The derivatives used to hedge the debt are interest rate swap contracts or options, which may or may not be eligible for hedge accounting. The eligible counterparties for interest rate hedging and investments are leading financial institutions which belong to the Sopra Steria banking syndicate. These financial instruments are managed by the Group Finance Department. All of the Group’s interest rate hedges have been put in place through the parent company (Sopra Steria Group).

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SOPRA STERIA UNIVERSAL REGISTRATION DOCUMENT 2019