Combined General Meeting of Shareholders THURSDAY 19 APRIL 2018 Paris INTRODUCTION
Vincent Bolloré Chairman of Vivendi's Supervisory Board 2017 HIGHLIGHTS 2018 CHALLENGES
Arnaud de Puyfontaine Chairman of Vivendi's Management Board 2015 - 2018: BUILDING A GLOBAL GROUP SPECIALIZING IN CONTENT, MEDIA AND COMMUNICATION
STAKES IN
ACQUISITION OF CESSIONSALE OFDE LA PARTICIPATIONOUR STAKE IN DANS STAKE IN
TRANSFORMATION PLAN OF
5-YEAR DEVELOPMENT PLAN ACQUISITION OF
ACQUISITION OF 2018
2017
2016 2015 POWERFUL AND COMPLEMENTARY ASSETS IN ORDER TO ENHANCE VALUE
CREATION DISTRIBUTION
COMMUNICATION 2017: A YEAR OF GROWTH FOR VIVENDI
,743 HIGHLIGHTS IN OUR BUSINESSES VIVENDI IN ITALY VIVENDI’S CHALLENGES FOR 2018
Make UMG increasingly strong
Maintain the growth impetus
Create more value for the group by using the creativity of Havas
Develop the next hit mobile video game
Stimulate innovation and new initiatives within the group MAKE VIVENDI EUROPE’S FIRST ENTERTAINMENT GROUP, WITH GLOBAL AMBITIONS
Powerful and complementary assets representing a unique value proposition
A solid financial position
The support of a leading industrial shareholder PRESENTATION OF 2017 FINANCIALS
Hervé Philippe Chief Financial Officer of Vivendi Member of Vivendi’s Management Board 2017 KEY CONSOLIDATED RESULTS
% underlying In millions of euros 2016 2017 % Change change
Revenues 10,819 12,444 + 15.0 % + 4.9 %
Adjusted earnings before interest and income taxes 724 987 + 36.4 % + 23.1 % (EBITA)*
Earnings before interest and income taxes (EBIT) 887 1,036 + 16.8 %
Earnings from continuing operations 1,255 1,261 + 0.4 %
Adjusted net income* 755 1,312 + 73.9 %
*non-GAAP measures CONSOLIDATED STATEMENT OF EARNINGS (IFRS)
In millions of euros– IFRS 2016 2017 % Change Revenues 10,819 12,444 + 15.0 % Income from operations* 853 1,116 + 30.9 % Adjusted earnings before interest and income taxes (EBITA)* 724 987 + 36.4 %
Amortization and depreciation of intangible assets acquired through business combinations (246) (124)
Reversal of reserves related to the Securities Class Action and Liberty Media litigations 240 27 in the US Income from equity affiliates(1) 169 146 Earnings before interest and income taxes (EBIT) 887 1,036 + 16.8 % Interest (40) (53) Income from investments 47 29 Other financial income and charges 438(2) (100) Provision for income taxes (77) 349(3) Earnings from continuing operations 1,255 1,261 Earnings from discontinued operations 20 - Non-controlling interests (19) (33) Earnings attributable to Vivendi SA shareowners 1,256 1,228 Adjusted net income* 755 1,312 + 73.9 %
*non-GAAP measures (1) Including Vivendi’s share of Telecom Italia’s net earnings (2) Including €576M (before taxes) related to the net capital gain on the sale of Vivendi’s remaining interest in Activision Blizzard (3) Including a current tax income of €409M following the settlement favorable to Vivendi SA related to the Consolidated Global Profit Tax System of 2011, as well as a current tax income of €243M corresponding to the refund of the amounts paid under the 3% tax on dividend distributions. REVENUES
% underlying In millions of euros - IFRS 2016 2017 % Change change
Universal Music Group 5,267 5,673 + 7.7 % + 10.0 %
Canal+ Group 5,253 5,246 - 0.1 % + 0.3 %
Havas - 1,151 na na
Gameloft 132 258 na - 0.1 %
Vivendi Village 111 109 - 1.4 % + 4.5 %
New Initiatives 103 51 ns ns
Elimination of intersegment transactions (47) (44)
TOTAL VIVENDI 10,819 12,444 + 15.0 % + 4.9 % EBITA
% underlying In millions of euros 2016 2017 % Change change
Universal Music Group 644 761 + 18.3 % + 20.6 %
Canal+ Group 240 318 + 32.1 % + 31.1 %
Havas - 111 na na
Gameloft 7 4 na + 12.5 %
Vivendi Village (9) (18)
New Initiatives (56) (92)
Corporate (102) (97)
TOTAL VIVENDI 724 987 + 36.4 % + 23.1 % UMG: FASTER GROWTH AND INCREASING PROFITABILITY
Significant increase of subscription and streaming revenue Revenue EBITA (in millions of euros) (in millions of euros) (in millions of euros)
+10.0%* +4.4%*
+2.7%* +35.4%*
+57.9%* +43.2%*
*At constant currency and perimeter CANAL+ GROUP: RECOVERY OF THE ACTIVITY IN FRANCE AND CONTINUOUS GROWTH INTERNATIONALLY
Strong growth in Africa Number of subscribers EBITA before restructuring (in millions of euros/thousands of subscribers) (in millions) (in millions of euros) HAVAS: AN ACCRETIVE ACQUISITION ENHANCING THE STRATEGIC PROJECT OF THE GROUP
Revenues Breakdown by activity Contribution to the Group’s EBITA in 2017 (in millions of euros) (in millions of euros)
+8%*
**
37%
63%
Creative + Health Media
* At constant currency. ** Contribution for the 2nd half only.
18 CONSOLIDATED BALANCE SHEET
ASSETS December 31, EQUITY AND LIABILITIES December 31, (In billions of euros) 2017 (In billions of euros) 2017
Goodwill 12.1 Consolidated equity* 17.9
Intangible and tangible assets 4.6 Provisions 1.9
Working capital requirements and Financial investments 9.2 3.8 other
Net debt** 2.3
TOTAL 25.9 TOTAL 25.9
* Including minority interests ** New definition of the Net Debt
19 FY 2017 NET DEBT* EVOLUTION
(in billions of euros)
+0.4 +1.0 1.2
-0.5 -0.2
-4.1 -0.1 ज礼ख紼झ Pro forma Net Debt* Dividends to Net Cash*, Share Interest and Acquisitions and Net Debt*, including disposals Vivendi SA CFFO Other Dec. 31, 2016 repurchases taxes investments Dec. 31, 2017 realized or considered, shareholders Dec. 31, 2017
* New definition of the Net Cash/Net Debt
20 STATUTORY FINANCIAL STATEMENTS VIVENDI SA 2017 BALANCE SHEET
ASSETS EQUITY AND LIABILITIES December 31, 2017 December 31, 2017 (In billions of euros) (In billions of euros)
Long term investments 23.6 Equity 19.2
Receivables 2.5 Provisions 0.6
Cash and marketable securities 1.3 Liabilities 7.6
TOTAL 27.4 TOTAL 27.4
22 STATEMENT OF EARNINGS
In millions of euros 2017
Operating income 83 Operating expenses - 220 Loss from operations - 137 Financial income 275 Financial provisions - 164 Other financial results 29 Financial income 140 Exceptional income from capital transactions and related to long-term investments - 14 Exceptional income from non-capital transactions and other provisions 195 Exceptional income 181 Income tax (charge)/credit 518 Earnings of the year 703
23 ALLOCATION OF EARNINGS ALLOCATION OF 2017 EARNINGS
It will be proposed to the Annual Shareholders’ Meeting the payment of an ordinary dividend of €0.45 per share with respect to fiscal year 2017, i.e. +12.5% vs. 2016
Dividend per share (in euro)
+12.5%
0.45
0.40
2016 2017 Retained earnings after the dividend payment would stand at 1.6 billion euros
25 — Maxime Saada Frank Cadoret Chairman of the Canal+ Group's Management Board Deputy General Manager of Canal+ France Chairman of Dailymotion Member of Canal+ Group’s Management Board AN AMBITION TO AND
CREATE AND PRODUCE FRENCH AND EUROPEAN
AUDIOVISUAL WORKS
AND DISTRIBUTE THEM WORLDWIDE
Growing the subscriber base Strengthening financial performance Creating premium, distinctive content Developing global distribution capacity GROWING THE SUBSCRIBER BASE
+3,8 m subscribers
15,6 m
11,6 m 11,8 m
2014 2015 2017
+2.4 million in France +1.4 million outside France A GLOBAL SUBSCRIBER BASE AND A PIVOTAL ROLE IN THE FRENCH-SPEAKING WORLD
FRANCE POLAND 8.6m subscribers 2.1m subscribers
VIETNAM 0.8m subscribers
MYANMAR FRENCH OVERSEAS TERRITORIES 0.6m subscribers AFRICA 3.5m subscribers STRENGTHENING FINANCIAL PERFORMANCE
SAVING PLAN
€359m of cumulative savings in 2017
€435m of cumulative savings in 2018
EBITA CANAL+ GROUP*
2016 2017 2019
€281m €367m €500m
+30% +36% * Before restructuring PREMIUM AND DISTINCTIVE CONTENT CREATION INVESTMENTS
Present in 190 countries Present in 190 countries Present in 30 countries
€6,4 bn invested €3,6 bn invested €3,2 bn invested in content in content in content CREATING PREMIUM, DISTINCTIVE CONTENT CINEMA, SPORTS ET TV SERIES CINEMA 400 original films released each year €670m invested in cinema per year The leading funder of French cinema Key film agreements
SPORTS
…
TV SERIES Key TV series agreements Original series that are very popular among subscribers CREATING PREMIUM, DISTINCTIVE CONTENT NEW PRODUCTIONS DUE IN 2018 …
Baron Noir Guyane LBDL Versailles Hippocrate Season 2 Season 2 Season 4 Season 3 Season 1
… AND IN 2019
Vernon Subutex
Engrenages Les Sauvages 000
AROUND 30 PROJECTS IN DEVELOPMENT FEATURING J. SFAR, B. MILLEPIED, J. DELPY, F. GASTAMBIDE, R. SATOUFF, F. BEIGBEDER, E. JUDOR, O. SY NEWNEW CHANNELSCHANNEL CREATION AND LAUNCHES
34 CREATION, PRODUCTION AND DISTRIBUTION OF CINEMA AND TV SERIES CONTENT
16 MILLION TICKETS SOLD AT THE FRENCH BOX OFFICE IN 2017
5 FILMS SELLING MORE THAN 1 MILLION TICKETS EACH IN FRANCE SAHARA (1.1m) PADDINGTON 2 (1.9m) EPOUSE MOI MON POTE (2.5m)
ALIBI.COM (3.6m) L’ÉCOLE BUISSONNIÈRE (1.9m)
15 PREMIUM SERIES INCLUDING SAFE, WHICH CLOSED THE CANNESERIES FESTIVAL DEVELOPING GLOBAL DISTRIBUTION CAPACITY
$225 MILLION IN GLOBAL BOX-OFFICE TAKINGS FOR PADDINGTON 2
Midnight Sun won the Export Fiction award for record sales in more than 100 countries
Sold to more than 70 countries Engrenages and Audrey Fleurot at the Apple Keynote event in 2017
Almost 1m viewers per episode Canal+ International, CNEWS and Studiocanal TV on the BBC in the UK distributed in the USA by Direct TV DISTRIBUTION MODEL RECASTED
ISP PARTNERSHIPS TECHNOLOGICAL PARTNERSHIPS REVAMP OF CANAL PACKAGES
TURNAROUND OF CANAL’S OFFERS
6.4M
3.1M 4.1M Growth of 3.9M 3.7M 3.5M 3.3M revenues and EBITA since
3.3M3.1M 2017
2012 2013 2014 2015 2016 2017 OVERHAUL OF PACKAGES
COMMITMENT
No commitment 20% OF 2017 SALES 12 months offer to service 24 months offer to service 98% OF SUBSCRIPTION +149k subscribers
+32% new subscribers
3.1M -11% churn
Back to growth of the subscriber base since 2017 +6% new subscriber ARPU CUSTOMER EXPERIENCE
MYCANAL
NEW SET-TOP BOX
SATELLITE / INTERNET 4K UHD MULTIROOM WIRELESS TV DOLBY ATMOS 13m 1m DOWNLOADS UNIQUE VIEWERS / 8 TUNERS DAY 1Tb SUPER RECORDER
SATISFACTION RATE FROM SUBSCRIBERS TO THE NEW OFFERS 82%
Olivier Nusse Chairman and CEO of Universal Music France THE MUSIC INDUSTRY’S VALUE “IS GROWING Rising consumption of music
Strong growth in content value
Importance of the back catalogue UNIVERSAL MUSIC GROUP AN INNOVATIVE ORGANIZATION, “ESSENTIAL FOR OUR TALENT
Virtuous synergies between Financial and human investments music and the Vivendi group assets
A global organization New form of talent scouting
The labels’ decisive role Expert and innovative teams RETURN TO GROWTH CONFIRMED 2017 “ 2016 +16.5% +11%
+10.6% +5%
+3.9% +5.5%
Source RIAA,SNEP FRENCH MARKET EVOLUTION
Physical “ €1.43bn Digital
€583m
49%
51%
Source SNEP UNIVERSAL MUSIC GROUP “MAJOR PARTNER OF DIGITAL PLAYERS NEW TECHNOLOGIES: A GROWTH FACTOR “ Connected speakers
increase of listening time
increase of the subscription conversion rate
Already more than 40 million
/ Source Edison users in the USA research / GLOBALIZATION OF THE MUSIC “MARKET
TOP 5 OF THE MUSIC MARKET
EMERGING MARKETS MIGOS – #1 album worldwide in Q1 DRAKE – God’s Plan #1 album worldwide in Q1
ANGÈLE – New talent signed in France RILÈS – New talent signed in France Yannick Bolloré Chairman and CEO, Havas Revenue + 100 €2.3bn Countries A global leader 20,000 + 700 Talented Agencies people Rest of Europe
19% North America 35% Geographical breakdown United Kingdom 11%
9% 20% 6% Asia-Pacific & Africa France Latin Balanced, America
Other Automotive
Travel and diversified 11% 8% entertainment 7% Healthcare revenue 19% TMT 12%
8% Sector 7% Agro-food Manufacturing & Services 6% breakdown 11% 11% Retail
Finance Mass consumer products Digital opportunity 75% of brands
could disappear without consumers caring + + MakingPUT YOUR BrandsTITLE MeaningfulHERE
Coactique aliquotiens nostri pedites ad eos persequendos scandere clivos sublimes etiam si lapsantibus plantis fruticeta prensando vel dumos macedonum manu priscorum.
+ Prestigious clients Pioneers in integration
HAVAS VILLAGE
CREATIVE MEDIA BUSINESS BUSINESS
CLIENT
HEALTH & WELLNESS BUSINESS Havas Villages #52
ABUJA KUALA LUMPUR SINGAPORE ALGIERS LISBON SYDNEY AMSTERDAM LONDON TAIPEI BANGKOK MADRID TOKYO BARCELONA MANCHESTER TORONTO BEIJING MANILA TUNIS BOGOTA MELBOURNE VIENNA BOSTON MEXICO VIENTIANE BRUSSELS MILAN WARSAW BUDAPEST MONTREAL YANGON BUENOS AIRES MUMBAI CHICAGO NEW YORK COPENHAGEN PANTIN (BETC) COSTA RICA PARIS DELHI PHNOM PENH DUBAI PRAGUE DUBLIN REUNION ISLAND HELSINKI SAN FRANCISCO HONG KONG SAO PAULO JAKARTA SEOUL JOHANNESBURG SHANGHAI Creative excellence
Awards Havas Creative Business represents
735 900 970 1500 of Group 2014 2015 2016 2017 revenue Creative excellence
Awards Havas Creative Business represents
735 900 970 1500 of Group 2014 2015 2016 2017 revenue Setting the standard in terms of media expertise
Havas Media Business represents
of Group revenue A global leader in healthcare communication
Havas Health Business represents Business
of Group revenue A targeted and strategic acquisitions
GT Media policy
VIETNAM
27 acquisitions, 2014-2017, and a strategic JV in China Successful integration The value we add
Scientific knowledge of Unrivalled skills in Acknowledged the consumer society of analysing Big creative today and tomorrow Data excellence Stéphane Roussel Chairman and CEO, Gameloft Member of Vivendi's Management Board GAMELOFT: A WORLD LEADER IN A FAST-GROWING MOBILE GAMES MARKET
1bn 5,300 +12% 45%
Gameloft games Gameloft staff Gameloft's 2017 revenue Mobile games' share downloaded in 2017 worldwide growth of the video games industry in the smartphone business 20 GAMELOFT STUDIOS WORLDWIDE
BUDAPEST
MINSK
BEIJING
PARIS BUCHAREST
KHARKOV MEXICALI DANANG MONTREAL HANOI TORONTO LVIV MANILA
SOFIA MADRID HO CHI MINH CITY CLUJ BRISBANE
BARCELONA YOGYAKARTA 65% OF GAMELOFT'S TOTAL REVENUES GENERATED BY ITS OWN FRANCHISES LICENCE AGREEMENTS WITH THE BIGGEST PLAYERS IN ENTERTAINMENT VIVENDI: A MAJOR BOOST FOR GAMELOFT
Improved financial performance compared with 2016 Facilitating links with the major platforms
12.6% increase 5% revenue in recurring growth in the operating Apple, Google income and Microsoft stores NEW OPPORTUNITIES IN VIDEO GAMES THROUGH THE SALE OF OUR STAKE IN UBISOFT
A friendly solution with the Guillemot family
A disposal that frees up significant resources for us to step up acquisitions in games for PCs and new consoles JOINT PROJECTS
Simon Gillham Maria Garrido Chairman of Vivendi Village Senior Vice President Vivendi Brand Marketing Member of Vivendi's Management Board PADDINGTON: A POWERFUL ENTERTAINMENT FRANCHISE DEVELOPED ACROSS OUR VARIOUS CREATIVE ENVIRONMENTS GREAT EXPECTATIONS IN TERMS OF CONTENT
77% 71%
58% MILLENNIALS GEN X
TVC 15’, 30’ BABY BOOMERS … WINNING SYNERGIES!
DIFFERENTIATING INSIGHTS & STRATEGY
ADVERTS EDITORIAL SOCIAL PARTNERSHIP EXPERIENCE SHORT FORM LONG FORM LIVE VIDEO
TVC 15’, 30’ … CONTENT PERFORMANCE CANALOLYMPIA: THE FIRST PANAFRICAN VENUES NETWORK FOR CINEMA AND LIVE EVENTS CANALOLYMPIA: THE FIRST PANAFRICAN VENUES NETWORK FOR CINEMA AND LIVE EVENTS ALREADY 8 CANALOLYMPIA VENUES OPEN IN AFRICA "THE NEW PLACE TO BE" FOR CULTURE IN AFRICA
”Black Panther” in CanalOlympia venues French rapper Niska in concert in Dakar "TOUR DE L’ESPOIR", THE FIRST BIKE RACE ORGANISED BY VIVENDI SPORTS IN AFRICA STATUTORY AUDITORS' REPORTS
Jean-Paul Seguret Deloitte & Associés WORK DONE BY THE STATUTORY AUDITORS
Purpose In accordance with professional standards, to obtain reasonable assurance about whether your company's consolidated and parent-company financial statements for 2017 are free of material misstatement.
Reporting to the management and governance bodies Summary of our work reported to the Audit Committee in its 13 February 2018 meeting. Presentation of our draft opinion to the Supervisory Board in its 15 February 2018 meeting.
Reports regarding the 2017 financial year Reports on the parent-company and consolidated financial statements, Special report on regulated agreements and commitments, Reports relating to authorisations to issue shares or other securities REPORTS ON THE PARENT-COMPANY AND CONSOLIDATED FINANCIAL STATEMENTS FOR 2017
Opinion on the financial statements Report on the consolidated financial statements presented on page 218 of the Reference Document, subject of the 2nd resolution. Report on the parent-company financial statements presented on page 324, subject of the 1st resolution. Certification without reserve of the consolidated and parent-company financial statements.
Justification of our assessments – Key points of the audit The justification of our assessments and the key points of the audit, for the consolidated financial statements, relate to estimates and judgements made regarding: . the measurement of goodwill, . the valuation of shares in Telecom Italia, which is accounted for under the equity method, . the recognition and valuation of investments in listed and unlisted companies, . the assessment of the type of influence exerted over Telecom Italia with respect to IFRS 10, . the analysis of litigation, particularly litigation with Mediaset and former non-controlling shareholders. REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS FOR 2017
Justification of our assessments – Key points of the audit The justification of our assessments and the key points of the audit, for the parent-company financial statements, relate to the estimates and judgements used to value equity securities and the analysis of litigation, particularly litigation with Mediaset and former non-controlling shareholders.
Other specific verifications Information relating to the Group provided in the management report and information regarding other statutory and regulatory obligations does not call for any particular comment on our part. SPECIAL REPORT ON REGULATED AGREEMENTS AND COMMITMENTS
Report presented on page 359 of the Registration Document
The new agreements and commitments in 2017 subject to approval by the general meeting of shareholders are as follows:
. Vivendi's acquisition of the Bolloré group's stake in Havas, . the amendment of the service agreement between Vivendi and Dominique Delport, . the contingent obligation with respect to the supplementary defined-benefit pension plan for Gilles Alix and Cédric de Bailliencourt, management board members since 1st September 2017. REPORTS WITH RESPECT TO EXTRAORDINARY RESOLUTIONS
Other reports with respect to extraordinary resolutions We have no observations to make regarding the reports relating to: . The proposed grant of power to cancel the company's own shares that it has acquired, up to a limit equal to 10% of the share capital, which is the subject of the 25th resolution;
. The grant of authority to: . issue shares in order to pay for assets transferred in kind to the Company and consisting of equity securities giving access to the capital or other securities, which is the subject of the 26th resolution;
. bonus share grants to all salaried staff members of the of the Company or related companies, and contingent grants of performance shares to certain categories of salaried staff members, and to corporate officers of such companies who meet conditions set out in law, which is the subject of the 27th resolution; REPORTS WITH RESPECT TO EXTRAORDINARY RESOLUTIONS
. decide to increase the capital through issues of shares or any other securities giving access to the capital that are reserved for employees and retired former employees who are members of a group savings plan, with shareholders' preferential subscription rights waived, which is the subject of the 28th resolution;
. decide to increase the capital through issues of shares or any other securities giving access to the capital that are reserved for employees of Vivendi's foreign subsidiaries who are members of a savings plan forming part of an international group savings plan, subject to a limit of 1% of the share capital as of the date of this Meeting, with shareholders' preferential subscription rights waived, which is the subject of the 29th resolution. CORPORATE GOVERNANCE, NOMINATIONS AND REMUNERATION COMMITTEE
Philippe Bénacin Vice-Chairman of Vivendi's Supervisory Board REMUNERATION OF THE CHAIRMAN OF THE SUPERVISORY BOARD IN RESPECT OF 2017 – 5TH RESOLUTION
The components of his remuneration for 2017 are in line with the 2017 remuneration policy adopted in the General Meeting of Shareholders of 25 April 2017 (11th resolution)
They are submitted to you for approval in accordance with article L. 225-100 II of the French Commercial Code:
- Fixed portion: €340,000 - Fixed attendance fee: €60,000 - Amount paid in respect of 2017: €400,000 - No other remuneration or benefits - Annual remuneration for 2018: unchanged (13th resolution) REMUNERATION POLICY FOR THE MANAGEMENT BOARD'S MEMBERS AND CHAIRMAN FOR 2017 (1/3)
The remuneration policy for the Management Board's members and Chairman for 2017 was approved by Vivendi's General Meeting of Shareholders of 25 April 2017 (12th and 13th resolutions):
- It is intended to align the remuneration of corporate officers as closely as possible with the interests of shareholders
- It applies the recommendations of the AFEP/MEDEF code
- It is developed by the Corporate Governance, Nominations and Remuneration Committee and then approved by the Supervisory Board REMUNERATION POLICY FOR THE MANAGEMENT BOARD'S MEMBERS AND CHAIRMAN FOR 2017 (2/3)
The policy is based on:
- A fixed salary in line with CAC 40 standards
- A maximum variable portion for Management Board members equal to 100% of fixed pay, with a target of 80%; the variable portion is determined on the basis of demanding quantitative and qualitative objectives, including a CSR criterion directly related to the Group's business. Despite the Group's strong performance in 2017, this resulted in a 75% attainment rate, lower than the target
- Performance share awards, with a longer-term objective. Again, Vivendi is very demanding, with an attainment rate of 75% for the vesting of the 2015 awards REMUNERATION POLICY FOR THE MANAGEMENT BOARD'S MEMBERS AND CHAIRMAN FOR 2017 (3/3)
To take account of Mr de Puyfontaine's role at Telecom Italia and Mr Alix and Mr de Bailliencourt's roles at the Bolloré group, the Supervisory Board, in its 15 February 2018 meeting, based on a proposal by the Corporate Governance, Nominations and Remuneration Committee, decided to establish a reference salary and a system of pro-rating in the event that members have responsibilities in several entities.
That system of pro-rating enables members: - to devote the time necessary for their roles within and outside the Vivendi group - without exceeding 100% of the corresponding remuneration IMPACT OF REBALANCING THE REMUNERATION OF THE MANAGEMENT BOARD'S MEMBERS AND CHAIRMAN As stated in the General Meeting of Shareholders of 25 April 2017, between 2016 and 2017 the fixed and variable portions of their remuneration and the long-term portion represented by performance share grants were rebalanced. The full effect of that rebalancing took effect in 2017:
Fixed + variable (annual basis) Fixed + variable (annual basis) + Performance shares Amounts paid Amounts paid Amounts paid Amounts paid Change (%) Change (%) in 2016 in 2017 in 2016 in 2017 -24.06% Arnaud de Puyfontaine €2,349,359 $2,124,831 -9.56% €3,743,959 €2,843,331
Frédéric Crépin €1,424,399 €1,331,524 -6.52% €2,158,399 €1,906,324 -11.68%
Simon Gillham €1,159,895 €1,167,111 +0.62% €1,893,895 €1,598,211 -15.61%
Hervé Philippe €1,841,128 €1,671,696 -9.20% €2,575,128 €2,246,496 -12.76%
Stéphane Roussel €1,911,411 €1,778,529 -6.95% €2,645,411 €2,353,329 -11.04% REMUNERATION OF THE CHAIRMAN OF THE MANAGEMENT BOARD IN RESPECT OF 2017 – 6TH RESOLUTION
The components of his remuneration for 2017 are in line with the remuneration policy for 2017 and are submitted to you for approval in accordance with article L. 225-100 II of the French Commercial Code:
- Fixed portion: €1,200,000
- Variable portion: €540,000
- Performance shares: 50,000 due to vest in 2022 subject to performance conditions assessed over three years
- Supplementary pension plan for Vivendi executives: eligibility subject to performance criteria REMUNERATION OF MANAGEMENT BOARD MEMBERS IN RESPECT OF 2017 – RESOLUTIONS 7-12 2017 variable remuneration limited to 75% of the fixed portion, lower than the 80% target, after the application of demanding, transparent, quantified and verifiable performance criteria (submitted to you for approval in accordance with article L. 225-100 II of the French Commercial Code):
Fixed salary (in euros) Rate Prorata Bonus Performance shares
Gilles Alix 166,667 (1) 75% 50% 62,500 (1) n/a
Cédric de Bailliencourt 133,333 (1) 75% 50% 50,000 (1) n/a
Frédéric Crépin 750,000 75% n/a 562,500 40,000
Simon Gillham 675,000 75% n/a 506,250 30,000
Hervé Philippe 940,000 75% n/a 705,000 40,000
Stéphane Roussel 1,000,000 75% n/a 750,000 40,000
(1) Pro-rated amount (member of the Management Board since 1 September 2017) / n/a: not applicable REMUNERATION POLICY FOR THE MANAGEMENT BOARD'S MEMBERS AND CHAIRMAN FOR 2018 – 14TH AND 15TH RESOLUTION (1/2)
The policy is unchanged for 2018
1. Prorata adjustment of the fixed and variable portions of Mr Puyfontaine as Chairman and Messrs Alix and de Bailliencourt as members of the Management Board: - to enable them to devote the time necessary for their roles within Telecom Italia and the Bolloré group - without exceeding 100% of the corresponding remuneration 2. Removal of the possibility of paying exceptional remuneration 3. Grant of performance shares up a total limit that is lower than the 2017 limit (200,000 shares for all Management Board members) REMUNERATION POLICY FOR THE MANAGEMENT BOARD'S MEMBERS AND CHAIRMAN FOR 2018 – 14TH AND 15TH RESOLUTION (2/2)
For 2018, the fixed and variable portions of remuneration have been determined for Management Board members as follows:
Fixed portion (in euros) Variable portion (in euros)
Reference variable portion Reference fixed portion Target Maximum
Arnaud de Puyfontaine 1,200,000 80% 100%
Gilles Alix 500,000 80% 100%
Cédric de Bailliencourt 400,000 80% 100%
Frédéric Crépin 800,000 80% 100%
Simon Gillham 750,000 80% 100%
Hervé Philippe 940,000 80% 100%
Stéphane Roussel 1,000,000 80% 100% CONTINGENT OBLIGATION WITH RESPECT TO THE SUPPLEMENTARY PENSION PLAN FOR NEW MANAGEMENT BOARD MEMBERS – 16TH AND 17TH RESOLUTIONS
The Supervisory Board appointed Messrs Alix and de Bailliencourt as Management Board members from 1st September 2017.
Messrs Alix and de Bailliencourt are eligible for the supplementary defined-benefit pension plan, set up in December 2005 and approved by the Combined General Meeting of Shareholders of 20 April 2006.
The rate of pension increases is calculated on the basis of performance criteria, as for all Management Board members. PERFORMANCE SHARES – 27TH RESOLUTION (1/2)
All performance share grants are subject to demanding, transparent, quantified and verifiable performance conditions, measured over a 3-year period, and vest 5 years after they are granted:
Internal objectives (70%): - Operating income (group EBIT): 35% - Operating cash flow after interest and tax (CFAIT): 35%
An external criterion (30%) based on Vivendi's share-price performance relative to: - The Euro Stoxx Media index (20%) - The CAC 40 (10%)
Applying these criteria to prices seen in recent years means that grants remain only partially vested:
Plan year 2012 2013 2014 2015
Reference periods used to assess performance criteria 2012-2013 2013-2014 2014-2015 2015-2016-2017
Proportion vested 88% 76% 75% 75% PERFORMANCE SHARES – 27TH RESOLUTION (2/2)
The authorisation you are asked to approve consists of the same elements as those approved in 2016:
- 1% of the share capital over a 3-year period (0.33% per year)
- Annual limit equal to 0.035% of the share capital for Management Board members
- 5-year lock-up period for shares: o performance criteria assessed over a 3-year period o subsequent lock-up period of 2 years for vested shares
- Number of beneficiaries in the group in 2017: 431 REMUNERATION POLICY FOR SUPERVISORY BOARD MEMBERS FOR 2018 – 13TH RESOLUTION
Maximum annual amount of attendance fees: €1.5 million, unchanged since the Combined General Meeting of Shareholders of 24 April 2008
Payment of a fixed amount of attendance fees depending on actual attendance at Board and Committee meetings and the number of such meetings:
- Board members: basic annual fee of €60,000, depending on attendance - Audit Committee members: basic annual fee of €40,000 (€55,000 for the Chairman) - Corporate Governance, Nominations and Remuneration Committee members: basic annual fee of €30,000 (€45,000 for the Chairman) - CSR Committee members: basic annual fee of €20,000 (€30,000 for the Chairman) AMENDMENT OF THE SERVICE CONTRACT WITH DOMINIQUE DELPORT, MEMBER OF THE SUPERVISORY BOARD – 3RD RESOLUTION
. The contract was authorised by Vivendi's Supervisory Board in its 2 September 2015 meeting, for a term of five years starting on 1 October 2015, and was approved by the General Meeting of Shareholders on 21 April 2016. Its terms were as follows: Fees: fixed remuneration of €300,000 + maximum variable remuneration of €200,000
. The Supervisory Board, on the recommendation of the Corporate Governance, Nominations and Remuneration Committee, decided in its 11 May 2017 meeting to remove the variable portion from 1 January 2017: Fees paid in 2017: €300,000 in respect of the fixed portion No payment relating to the variable portion has taken place since 1 October 2015
. The contract has now ended. Mr Delport is also no longer a member of the Corporate Governance, Nominations and Remuneration Committee. EMPLOYEE SHARE OWNERSHIP – 28TH AND 29TH RESOLUTIONS
This year, Vivendi is carrying out a capital increase reserved for its employees, with a discount of 15%.
The authorisation limit proposed to you this year remains 1% of the share capital.
All of the Group's main subsidiaries in France have entered into employee profit-sharing and/or incentive agreements benefiting all employees. WORK DONE BY THE AUDIT COMMITTEE VIVENDI'S CSR POLICY
Cathia Lawson-Hall Chairman of the Audit Committee ORGANISATION OF THE AUDIT COMMITTEE
4 meetings
mainly concerning the audit of the financial statements in the presence of the statutory auditors 4 members Periodic meetings organised by the Chairman of the Committee including 3 independent members Preparation of an annual work programme ACTIVITIES IN 2017
The successful integration of Havas into the group's functional processes, particularly related to financial and tax reporting, cash management and internal audit Regular monitoring regarding the establishment of the compliance programme, a priority for Vivendi . Specific measures to manage risks related to corruption or influence peddling (Sapin 2 act)
. A duty of care plan to prevent breaches of human rights, fundamental freedoms, and health, safety and environmental rules (France's duty of care act for parent companies)
. Tougher rules to protect personal data collected by the group (GDPR) The Audit Committee's continuing involvement in the CSR policy and the integrated reporting approach OUR TASKS FOR 2018
In addition to the half-year/full-year financial statements and to the changes in the group's scope and its full consolidation by the Bolloré group:
. Continuing occasional sessions on impairment, risk mapping, debt and pension liabilities
. Rolling out the compliance programme across the group
. Monitoring the development of the CSR policy and the integrated reporting approach VIVENDI: A SOCIALLY ENGAGED GROUP
80% of French people believe that:
"companies that behave in an ethical and responsible way will be the ones that succeed economically in future"
Taken from a Havas / Institut CSA - Observatoire des marques survey – January 2018 VIVENDI: A SOCIALLY ENGAGED GROUP
Our CSR policy is based on the following major commitments:
. Promoting cultural diversity and supporting talent
. Facilitating access to ambitious, high-quality content
. Supporting local development
. Assisting and protecting young people in relation to their digital usage WORK DONE BY THE CSR COMMITTEE
Paulo Cardoso Chairman of the CSR Committee THE GROUP’S CSR COMMITTEE
Tasks To prepare for Board decisions and make recommendations on: . the group's social and environmental issues . employee-management dialogue and employee engagement . social projects and corporate philanthropy programmes CSR COMMITTEE: MEMBERSHIP
4 members
Paulo Cardoso Cathia Lawson-Hall Member of the Supervisory Board Member of the Supervisory Board and representing employees and Chairman of Chairwoman of the Audit Committee the CSR Committee Sandrine Le Bihan Véronique Driot Member of the Supervisory Board Member of the Supervisory Board, representing employee-shareholders employee of Vivendi SA CSR COMMITTEE: WORK
Two annual meetings ahead of Supervisory Board meetings Monthly meetings organised by the Committee's Chairman Preparation of an annual work programme around a given theme (2018: diversity)
DISCLAIMER
Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements with respect to Vivendi's financial condition, results of operations, business, strategy, plans, and outlook of Vivendi, including the impact of certain transactions and the payment of dividends and distributions as well as share repurchases. Although Vivendi believes that such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance. Actual results may differ materially from the forward-looking statements as a result of a number of risks and uncertainties, many of which are outside Vivendi’s control, including, but not limited to, the risks related to antitrust and other regulatory approvals as well as any other approvals which may be required in connection with certain transactions and the risks described in the documents of the group filed by Vivendi with the Autorité des Marchés Financiers (French securities regulator) and its press releases, if any, which are also available in English on Vivendi's website (www.vivendi.com). Investors and security holders may obtain a free copy of documents filed by Vivendi with the Autorité des Marchés Financiers at www.amf-france.org, or directly from Vivendi. Accordingly, readers of this presentation are cautioned against relying on these forward-looking statements. These forward-looking statements are made as of the date of this presentation. Vivendi disclaims any intention or obligation to provide, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Unsponsored ADRs Vivendi does not sponsor an American Depositary Receipt (ADR) facility in respect of its shares. Any ADR facility currently in existence is “unsponsored” and has no ties whatsoever to Vivendi. Vivendi disclaims any liability in respect of any such facility.