technicolor - 2018 Registration document

FINANCIAL STATEMENTS

NOTE 5 OTHER OPERATING INFORMATION

Other operating information

NOTE 5

Operating assets & liabilities

5.1

5.1.1

NON-CURRENT OPERATING ASSETS & LIABILITIES

2018

2017

(in million euros)

Customer contract advances and up-front prepaid discount

17

10 28 38

Other

24 41

OTHER OPERATING NON-CURRENT ASSETS Payable on acquisitions of business & fixed assets

(12) (26) (38)

(32) (25) (57)

Other

OTHER OPERATING NON-CURRENT LIABILITIES

As part of its normal course of business, Technicolor makes cash terms for services and volumes to be provided and other terms and advances and up-front prepaid discount to its customers, principally conditions.

within its Entertainment Services segment. These are generally in the framework of a long-term relationship or contract and can take different forms. Consideration is typically paid as an advance to the customers in return for the customer’s various commitments over the life of the contracts. These contracts award to the Group a customer’s business within a particular territory over the specified contract period (generally from 1 to 5 years). The contracts contain provisions that establish pricing

Such advanced payments are classified under “Non-current assets”, recorded as “Contracts advances and up-front prepaid discount” and are amortized as a reduction of “Revenues” on the basis of units of production or film processed.

5.1.2

INVENTORIES

ACCOUNTING ESTIMATES AND JUDGMENTS: The management takes into consideration all elements that could have an impact on the inventory valuation, as declining sales forecasts, expected reduction in selling prices, specific actions engaged as rework or incentive plans, and obsolescence of products or slow rotation.

Inventories are valued at acquisition or production cost. The production costs include the direct costs of raw materials, labor costs and a part of the overheads representative of the indirect production costs, and exclude general administrative costs. The cost of inventory sold is determined based on the weighted average method or the FIFO (first in – first out) method, depending on the nature of the inventory. When the net realizable value of inventories is lower than its carrying amount, the inventory is written down by the difference.

6

2018

2017

(in million euros) Raw materials Work in progress

102

38 10

14

Finished goods and purchased goods for resale

175 291 (23) 268

214 262 (24) 238

Gross value

Less: valuation allowance TOTAL INVENTORIES

203

TECHNICOLOR REGISTRATION DOCUMENT 2018