Financial Report 30 June 2020 SNCF Group V30.07 À 17H10

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Financial Report 30 June 2020 SNCF Group V30.07 À 17H10 FINANCIAL REPORT 30 JUNE 2020 SNCF GROUP SNCF.COM SNCF G ROUP B OARD O F D IRECTORS M EETING O F 3 0 J ULY 2 020 S SNCF GROUP 01 – S NCF G ROUP H ALF-YEAR A CTIVITY R EPORT PAGE 1 02 – S NCF G ROUP C ONDENSED H ALF-YEAR PAGE 2 1 CONSOLIDATED F INANCIAL S TATEMENTS 03 – S TATUTORY A UDITORS’ R EPORT O N T HE C ONDENSED PAGE 5 5 HALF-YEAR C ONSOLIDATED F INANCIAL S TATEMENTS DECLARATION BY THE PERSONS RESPONSIBLE FOR THE HALF-YEAR FINANCIAL REPORT LA PLAINE SAINT-DENIS, 30 JULY 2020, We declare that, to the best of our knowledge, the condensed half-year consolidated financial statements for the six months ended 30 June 2020 have been prepared in accordance with the applicable accounting standards and give a true and fair view of the assets and liabilities, financial position and results of the issuer and of the group of companies included in the consolidation as of and for the period ended 30 June 2020, and that the half-year activity report fairly presents trends in the operations, results and financial position of the issuer and of the group of companies included in the consolidation as well as a description of the principal risks and uncertainties that we face. JEAN-PIERRE F ARANDOU LAURENT T RÉVISANI CHAIRMAN A ND C HIEF E XECUTIVE O FFICER O F T HE S NCF DEPUTY C EO GROUP FINANCIAL S TRATEGY SNCF GROUP - 2020 HALF-YEAR FINANCIAL REPORT 30 JUNE 2020 01 – SNCF GROUP HALF-YEAR ACTIVITY REPORT Rappo rt de gestion 01 1 SNCF G ROUP - 2 020 H ALF-YEAR F INANCIAL R EPORT THE SNCF GROUP IN THE FIRST HALF OF 2020 3 1. SIGNIFICANT EVENTS OF THE FIRST HALF OF 2020 3 2. SNCF GROUP KEY FIGURES 4 3. EVENTS AFTER THE REPORTING PERIOD 4 GROUP RESULTS 5 1. ANALYSIS OF GROUP RESULTS 5 2. SEGMENT RESULTS 8 3. INVESTMENT AND NET DEBT 17 4. ACQUISITIONS OF EQUITY INVESTMENTS 18 5. FINANCIAL RELATIONS WITH THE STATE AND LOCAL AUTHORITIES 18 6. EMPLOYEE MATTERS 19 OUTLOOK AND CHALLENGES 20 2 SNCF GROUP - 2020 HALF-YEAR FINANCIAL REPORT 1 - SIGNIFICANT EVENTS OF THE FIRST HALF OF 2020 03 0 1 – THE SNCF GROUP IN THE H A L F - Y FIRST HALF OF 2020 E A R A C T I V I The New Railway Pact Law (law no 2018-515 of 27 June 2018), as supplemented by Order no 2019-552 of 3 June 2019, T came into force on 1 January 2020. With effect from that date, the SNCF Group has adopted a new organisational Y structure based on eleven operating segments. R E P O R T 1. SIGNIFICANT EVENTS OF THE FIRST Finally, the Group has drawn up a specific action plan aimed at generating additional savings by the end of HALF OF 2020 2020, to mitigate the financial effects of the crisis. In 1.1 COVID-19 PUBLIC HEALTH CRISIS parallel, in mid-March the Group implemented partial lay- off measures (see Note 1.2.1 to the condensed half-year The Covid-19 public health crisis has had a severe impact consolidated financial statements). on the operations of the SNCF Group. SNCF Voyageurs was particularly hard hit. Operations 1.2 STRIKE ACTION were sharply reduced from 16 March 2020; services The strike action that began on 5 December 2019 in gradually recovered from the first easing of lockdown opposition to proposed pension reforms continued until measures, subject to compliance with governmental February 2020. biosecurity requirements. This resulted in a loss of business which, along with The financial consequences for revenue and for key refunds and other concessions, had an adverse impact on financial indicators by business line and operating revenue in the Group’s 2020 first-half financial statements. segment are described in section 2 of the half-year activity report. 1.3 PARTIAL ASSUMPTION OF DEBT BY THE STATE The new economic landscape was taken into account when testing CGUs and goodwill for impairment, as On 1 January 2020, the State assumed €25bn (at nominal described in Note 4.3 to the condensed half-year value on redemption) of the debt carried by SNCF Réseau, consolidated financial statements. in line with the French 2020 Budget Act. The Group also adapted its treasury management policies The mechanism used is described in the notes to the during this period to ensure that it can meet all its condensed half-year consolidated financial statements. obligations and financial commitments as they fall due. A The impact of this transaction on net finance costs is an specific note describing the measures implemented is amount of net financial income that exactly mirrors the presented in Note 5 to the condensed half-year finance cost effectively borne by SNCF Réseau on the consolidated financial statements. portion of its historical debt assumed by the State. 3 2 - SNCF GROUP KEY FIGURES SNCF GROUP – 2020 HALF-YEAR FINANCIAL REPORT 03 Rappo rt de gestion 1.4 NEGOTIATION OF THE ÎLE-DE-FRANCE (4) Free cash flow is calculated as follows: T MOBILITÉS 2020-2023 CONTRACT R € m illion 3 0/06/2020 30/06/2019 O A new contract for the 2020-2023 period relating to the by aggregating the following line P implementation of passenger transport pricing and service E items from the cash flow statement: policies in the Île-de-France (Greater Paris) region is R - Cash from operations after cost of Y currently being negotiated with Île-de-France Mobilités net debt and taxes -520 1,903 T I (the regional Transport Organising Authority). Pending - Acquisitions of intangible assets V I finalisation of that contract, SNCF Voyageurs is and property, plant and equipment -3,033 -3,587 T C recognising revenue equal to the aggregate amount of - Investment grants received 764 886 the fixed monthly payments on account paid by Île-de- - Repayments of lease liabilities -502 -479 A R France Mobilités under article R.1241-25 of the French - Repayment of IFRS 16 lease A Transport Code, which specifies the provisional fixed receivables 1 1 E Y contribution that Île-de-France Mobilités must pay SNCF - Proceeds from disposals of - F Voyageurs to ensure continuity of service. intangible assets and property, plant L and equipment 91 139 A 2. SNCF GROUP KEY FIGURES - New concession financial assets -693 -730 H - Cash inflows from concession – 1 € m illion 3 0/06/2020 30/06/2019 financial assets 565 376 0 - Impact of change in working capital Revenue 14,129 17,854 requirement 398 -341 EBITDA 69 2,906 change in working capital Net profit/(loss) attributable to requirement relating to income equity holders of the parent -2,389 20 taxes, included in the cash flow Recurring net profit/(loss) statement line item “Taxes attributable (paid)/collected” 109 138 to equity holders of the parent (1) -2,384 10 accrued interest on IFRS 16 lease Net investment (2) 2,397 3,055 liabilities, included in the cash flow statement line item “Interest paid on Investment all funding sources (3) 3,752 4,299 lease liabilities” 0 14 Free cash flow (4) -2,809 -1,666 dividends received from entities Headcount 271,949 274,234 accounted for by the equity method, included in the cash flow statement line item “Dividends received” 12 13 € m illion 3 0/06/2020 31/12/2019 Total free cash flow -2,809 -1,666 SNCF Group net debt 38,327 60,281 of which SNCF Réseau net debt 28,784 51,852 3. EVENTS AFTER THE REPORTING PERIOD The principal events after the reporting period are (1) For a definition of “Recurring net profit/(loss)”, see the described below. “Group Results” section of this half-year activity report. 3.1 SIGNATURE OF BUILDING PERMIT FOR THE (2) “Net investment” is calculated as follows: GARE DU NORD MODERNISATION PROJECT € m illion 3 0/06/2020 30/06/2019 The Paris Gare du Nord 2024 project, housed within the by aggregating the following line single-purpose semi-public company Stationord, obtained items from the cash flow statement: consent from the Paris Prefecture when the building - Acquisitions of intangible assets and permit was signed on 6 July 2020. property, plant and equipment 3,033 3,587 - Investment grants received -764 -886 Work on this project, which aims to enhance the - New concession financial assets 693 730 attractiveness of public transport in the Île-de-France - Cash inflows from concession region and hence reduce pollution, is due to start in the financial assets -565 -376 summer of 2020. Total net investments 2,397 3,055 3.2 SUSPENSION OF PAYMENTS FROM ÎLE-DE- (3) “Investment all funding sources” is calculated as follows: FRANCE MOBILITÉS TO SNCF TRANSILIEN € m illion 3 0/06/2020 30/06/2019 Pending signature of the contract for the 2020-2024 period, Île-de-France Mobilités is paying a provisional by aggregating the following line fixed monthly contribution to SNCF Transilien to ensure items from the cash flow statement: - Acquisitions of intangible assets and continuity of service under Article R.1241-25 of the French property, plant and equipment 3,033 3,587 Transport Code. The monthly payments scheduled for the - New concession financial assets 693 730 first half of 2020 were made each month on the dates minus changes in workin g capital specified in the previous contract. requirement relating to investing However, the Board of Directors of Île-de-France Mobilités activities, as presented in Note 4.2 to voted on 8 July 2020 to suspend those payments from July the condensed half-year consolidated onwards, until such time as the State makes good the loss financial statements -26 18 of revenue due to the Covid-19 crisis.
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