technicolor - 2018 Registration document

6 FINANCIAL STATEMENTS NOTE 6 INCOME TAX

GROUP TAX PROOF 6.1.2 The following table shows the reconciliation of the expected tax expense – using the French corporate tax rate of 34% – and the reported tax expense. In 2017, the applicable French corporate tax rate was 39% further to an extraordinary contribution of 15% due by companies with revenues over €1 billion. The ietms in reconciliation are described hereafter:

2018 (224)

2017* (168)

(in million euros)

Profit (loss) from continuing operations

Income tax

(54)

(112) (56) 39%

Pre-tax accounting income on continuing operations

(170)

34%

Expected tax expense

59

22

(84) (14) (14)

107

Effect of unused tax losses and tax offsets not recognized as deferred tax assets (1)

Effect of permanent differences Effect of different tax rates applied (2) Effect of change in applicable tax rate (3)

10 20

-

(270)

Withholding taxes not recovered

(1)

(1)

Effective tax expense on continuing operations

(54)

(112)

2017 amounts are re-presented to reflect the impacts of Discontinued Operations (see note 12). * In 2018, mainly due to: (1) the depreciation of deferred tax assets in the United States for €61 million as there is no probability anymore to use the tax losses carried forward in the next five years; - the depreciation of deferred tax assets in France for €11 million further to the disposal of the Patent Licensing business. -

In 2018, the amounts include mainly impact of the tax differentials with the United States. (2) In 2017, mainly related to tax rate decrease from 35% to 21% in the United States. (3)

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TECHNICOLOR REGISTRATION DOCUMENT 2018