2017 Financial and CSR Report Attestation of the Persons Responsible for the Annual Report
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2017 Financial and CSR Report Attestation of the persons responsible for the annual report We, the undersigned, hereby attest that to the best of our knowledge the financial statements have been prepared in accordance with generally-accepted accounting principles and give a true and fair view of the assets, liabilities, financial position and results of the company and of all consolidated companies, and that the management report attached hereto presents a true and fair picture of changes to the business, the results and the financial position of the company and of all consolidated companies as well as a description of the main risks and contingencies facing them. Paris, 23 March 2018. Chairwoman and CEO Catherine Guillouard Chief Financial Officer Alain Le Duc CONTENTS Management Consolidated report fi nancial statements RATP group organisation chart 5 2017 financial results 6 Statutory Auditors’ report on the consolidated financial Social, environmental statements 89 and societal information 17 Consolidated statements Note on methodology of comprehensive income 93 for the extra-financial report 50 Consolidated balance sheets 95 Report by one of the Statutory Auditors 54 Consolidated statements of cash flows 96 Internal control relating to the preparation and treatment Consolidated statements of accounting and financial of changes in equity 97 reporting 57 Notes to the consolidated Risk management and internal financial statements 98 control and audit functions 63 Corporate Financial governance statements report Statutory Auditors’ report on the financial statements 153 Composition of the Board of Directors EPIC balance sheet 156 and terms of office 77 EPIC income statement 157 Role of the Board of Directors 77 Notes to the financial Compensation and benefits 78 statements 158 Appendices 78 ƙƗƘƞ FINANCIAL AND CSR REPORT ş ƚ 2017 management report RATP group organisation chart p. 5 2017 financial results p. 6 Social, environmental and societal information p. 17 Note on methodology for the extra-financial report p. 50 Report by one of the Statutory Auditors p. 54 Internal control relating to the preparation and treatment of accounting and financial reporting p. 57 Risk management and internal control and audit functions p. 63 ş RATP GROUP RATP group organisation chart 31 December 2017 FRANCE/SWITZERLAND 60 operational subsidiaries UNITED KINGDOM* 6 operational subsidiaries ITALY* 5 operational subsidiaries RATP DÉVELOPPEMENT ŧƘƗƗ%Ũ UNITED STATES* 3 operational subsidiaries AFRICA 4 operational subsidiaries ASIA (Transdev partnership)* 8 operational subsidiaries MIDDLE EAST* 2 operational subsidiaries SIGHTSEEING* 3 operational subsidiaries TRANSPORT Ũ OTHERS 4 operational subsidiaries + miscellaneous SCIs RATP i IXXI SETIM ŧƘƗƗ%Ũ 100% 60% RATP RATP 100% NAVOCAP 25% WIZWAY SOLUTIONS 100% IXXI TECHSIDE PARENT COMPANY PARENT ŧ 100% RATP CAPITAL 20% MOBIZEN INNOVATION 41.92% SYSTRA ƛƟ SUBSIDIARIES 50% METROLAB 100% PROMO MÉTRO ŧSERVICESŨ 100% TELCITÉ ŧTELECOMSŨ 100% TELCITE NAO 100% NAXOS 100% SEDP ŧREAL ESTATEŨ 100% SADM VALUATION OF RATP SITES RATP OF VALUATION 99.99% LOGISŀTRANSPORTS 99.95% HOUSING ŧREAL ESTATEŨ TRANSPORT Equity accounted Not consolidated * Subsidiaries held by means of a holding company owned 100% (50% for the Transdev partnership in Asia). NB: the list of operational subsidiaries (holding contracts) is supplied in point 38 of the appendices to the consolidated financial statements. ƙƗƘƞ FINANCIAL AND CSR REPORT ş Ɯ MANAGEMENT REPORT 2017 financial results RATP group (“the Group”) is a major public transport provider in France, operating in towns and suburbs and particularly in the Île-de-France region. 2017 financial results ƙƗƘƝ ƙƗƘƝ ƙƗƘƞ ƙƗƘƞ ƑƜ,ƛƟƝ million Consolidated Group Recurring net income attributable to owners revenues (up from ƑƜ,Ɵ million in ƙƗƘƝ) of the company ƑƙƝƝ million (ƑƘƝƚ million in ƙƗƘƝ) ƙƗƘƝ ƙƗƘƝ ƙƗƘƞ ƙƗƘƞ Group recurring EBIT ƑƛƛƟ million Recalculated cash fl ow (Ƒƚƞƛ million in ƙƗƘƝ) from operations €976 million(1) (Ƒ912 million in 2016) Ƒƛ,ƚƞƙ million ƠƠ million ƑƜ,ƛƟƝ million ƑƘ, ƝƗ million Consolidated Group invested in Île-de-France revenues Contribution from subsidiaries €1,114 million of which 861 million funded by equity (20.3% of consolidated revenue) (1) After restatement for remeasurement of deferred tax assets. The parent company and This same law specified that lines created before 3 December 2009 shall continue to be operated under the terms of the agreements its contractual environment effective as at that date and the agreements that shall be negotiated under the defined legal framework until 31 December 2024 for bus The parent company, Régie autonome des transports parisiens services, until 31 December 2029 for tramway services and until (RATP), is a State-owned industrial and commercial public utility 31 December 2039 for other transport services (metro and RER). The (établissement public à caractère industriel et commercial – EPIC) operating rights granted to RATP are thus limited in duration, with created by the law of 21 March 1948. It is a legal entity under public renewal possible under the terms stipulated by law. law. Its head office is located at 54, quai de la Rapée, 75012 Paris (listed in the Paris trade and companies register – Registre du com- The ORTF law set out the framework governing the compensation of merce et des sociétés). RATP for managing the infrastructure and operating the services, ensuring an appropriate return on capital employed. The aim of RATP is to run a public transport service in Île-de-France and its purpose, fixed by French law No. 2009-1503 dated 8 December The Île-de-France transport offer and pricing are defined by the 2009 on public passenger services by rail (ORTF law), is to manage Syndicat des Transports d’Île-de-France commonly called Île-de- the network infrastructure for public passenger transport services in France Mobilités. RATP’s activity as operator is governed by multi-year Île-de-France, excluding the responsibilities conferred on SNCF agreements with Île-de-France Mobilités. As part of these agreements, Réseau. RATP undertakes to provide a transport service defined in terms of Ɲ ş RATP GROUP quantity and quality, and receives compensation based on the direct At the same time, RATP is committed to producing a contractual revenue and flat-rate contributions paid by Île-de-France Mobilités. transport service, defined by volume and quality. The agreement is passenger-focused, with demanding terms and conditions in relation Compensation for the contractual service supplied by RATP, solely on to production, regularity and service quality, an indicator-based sys- the basis of direct revenue, does not balance the economic model. tem for measuring the achievement of targets and a €25 million Indeed, single and season ticket prices set by the transport authorities bonus package. do not, in fact, cover the real cost of the services. The flat-rate contri- butions made by the Syndicat des Transports d’Île-de-France enable Commercial risk (traffic-related revenue) is shared between RATP and RATP to balance its books so that it can continue to supply its ser- the Syndicat des Transports d’Île-de-France: the agreement provides vices, fund capital expenditure and hit related contractual targets. for 1% annual growth in passenger revenue and includes a risk-shar- Subsidies therefore account for around 42% of RATP’s revenue. On ing clause similar to the previous agreement in the event of variance. a national level, subsidies average 70% for less dense networks A specific arrangement was provided for in 2016 and 2017 to mitigate CEREMA (Centre d’études et d’expertise sur les risques, l’environne- the impact of the all zones flat-fare reform. ment, la mobilité et l’aménagement – centre for studies and expertise on risks, environment, mobility, and urban and country planning, Price risk is carried by the Syndicat des Transports d’Île-de-France: 2016 for French networks with over 200,000 inhabitants, not includ- when ticket prices change, the Syndicat des Transports d’Île-de-France ing Paris). contributions are amended accordingly. Since the adoption of French law No. 2000-1208 on solidarity and RATP is responsible for risk related to expenses. urban renewal, RATP has been authorised to operate public transport The 2016-2020 agreement covers: networks via its subsidiaries throughout France and abroad. • a package of additional services included in the compensation to In 2017, RATP’s operations accounted for 79.7% of the Group’s rev- increase the number of the Syndicat des Transports d’Île-de-France enue. RATP’s main client is Île-de-France Mobilités. targets hit and to meet passenger expectations (€100 million over five years for improvements in cleanliness, security, shorter bus IDFM pays RATP four contributions, the first two of which are fixed journey times and support for the Noctilien network); and not revisable, unless updated by means of contractual amend- • harmonisation of RATP’s tax arrangements, in accordance with ments (primarily for new services and tariff reforms): common law governing EPICs, particularly with regard to corporate • the contribution to operations and public service obligations covers income tax. operating expenses not covered by direct revenue from transport users; Subsidiaries’ areas of expertise • the contribution to funding capital expenditure is, in the contract, on the one hand, to cover amortisation and depreciation, and on RATP Développement (RATP Dev) is the RATP subsidiary respon- the other, to cover interest expense; sible for developing and managing public transport network operating • the contribution in relation to certain tax expenses and taxes passed agreements won outside RATP’s traditional area of operations, in on to the Île-de-France transport authority (Syndicat des Transports France and internationally. RATP Dev and its subsidiaries currently d’Île-de-France) euro for euro (primarily the French regional levy account for the greatest percentage of group business conducted out- (contribution économique territoriale), and land tax); side the RATP parent company. • the lease contribution specific to funding the purchase of rolling stock for T3, T5, T6, T7 and T8 tramways.