Worldline - 2019 Universal Registration Document

FINANCIALS Consolidated financial statements

Short-term benefits include salaries, bonuses and fringe benefits as well as Director’s fees paid to Board of Director’s members. On performance shares and stock options, the cost includes the IFRS 2 charge on the prorata temporis since the grant date.

Bonuses correspond to the total charge reflected in the income statement including the accruals related to current year. No post-employment compensation has been paid to the key management personnel during the year.

Market risk Note 15

Foreign exchange risk Majority of the Group’s revenues, expenses and obligations are denominated in euro. In 2019, 72.1% of the Group’s revenues were generated in euro-zone countries whereas 27.9% were generated in non-euro zone countries, including 14.9% in Swiss Franc and 3.9% in pounds sterling. Since the Group’s financial statements are denominated in euro, its revenues are affected by the relative value of the euro versus the currency of the non-euro zone countries in which it generates revenues (currency translation exposure). In terms of currency transaction exposure ( i.e. , a mismatch between the currencies in which revenues are generated and costs are incurred), the Group considers its exposure to be limited as its costs in the euro zone are generally incurred in euros and its revenues are generated in euros and in non-eurozone countries it generally makes its sales and incurs the majority of its operating expenses in the local currency. The Group maintains a policy for managing its foreign exchange position if and to the extent it enters into commercial or financial transactions denominated in currencies that differ from the relevant local currencies. Pursuant to this policy, any material foreign exchange rate exposure must be hedged as soon as it occurs using various financial instruments, including, principally, spot or forward contracts and foreign currency swaps. As of December 31, 2019, the Group did not have any material foreign exchange rate exposure. Interest rate risk The vast majority of Group Borrowings are fixed rate Bonds. The Group considers that its exposure to interest rate fluctuations is not material. Net debt (Borrowings net of cash and cash equivalents) of the Group as of December 31, 2019 was € 641.3 million. Liquidity risk Liquidity risk management involves maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities. Worldline’s policy is to cover fully its expected liquidity requirements by a long-term committed line of credit. Terms and conditions of the loans include maturity leaving sufficient flexibility for the Group to finance its operations and expected developments.

On December 20, 2018, Worldline SA (as Borrower) signed a five-year Revolving Credit Facility (the “Facility”) for an amount of € 600 million, maturing in December 2023 with an option for Worldline to request the extension of the Facility maturity date until December 2025. In October 2019, first extension has been requested and approved by the banks. The revolving credit facility maturity date is now December 2024. Under the terms of the initial agreement, the Facility included one financial covenant, which was the consolidated leverage ratio (net debt divided by Operating Margin before Depreciation and Amortization) that should not be greater than 2.5 times. In December 2019, the cancellation of the financial covenant was obtained and the Facility does not include any more this financial covenant. This Revolving Credit Facility remained unused at the end of December 2019. Credit and/or Counterparty Risk Credit and/or counterparty risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group believes that it has limited exposure to concentrations of credit risk due to its large and diverse customer base. The Group’s greatest credit risk position is borne with respect to its financial institution customers. The Group manages this credit risk by consistently selecting leading financial institutions as clients and by using several banking partners. The Group is also exposed to some credit risk in connection with its Commercial Acquiring. For each transaction, the Group provides a performance guarantee to the merchant in respect the cardholder’s payment. Therefore, the Group is exposed to a credit risk in the event of non-payment by the cardholder. Additionally, the Group offers a guarantee of “service rendered” to the cardholder. Accordingly, in the event a merchant goes bankrupt (or ceases to operate) before delivering the product or rendering the service purchased by a cardholder, the cardholder can require the Group to reimburse it for the amount of the transaction. This credit risk exposure is especially significant where services are purchased through e-Commerce well in advance of the time that they are actually rendered ( e.g. , ticket purchases through travel agencies). The Group monitors these risks by selecting financially sound clients, requesting guarantees (collateral build up, delegation of insurance, etc.) and checking daily transaction flows to avoid excessive exposure to these risks.

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285 Universal Registration Document 2019