Groupe Renault - 2020 Universal Registration Document

425 GROUPE RENAULT I UNIVERSAL REGISTRATION DOCUMENT 2020 04 RENAULT SA ANNUAL FINANCIAL STATEMENTS GROUPE RENAULT GROUPE RENAULT: A COMPANY THAT ACTS RESPONSIBLY CORPORATE GOVERNANCE FINANCIAL STATEMENTS RENAULT AND ITS SHAREHOLDERS ANNUAL GENERAL MEETING OF RENAULT ON APRIL 23, 2021 ADDITIONAL INFORMATION Notes to the annual financial statements 4.4.2 The following disclosures constitute the notes to the balance sheet at December 31, 2020, before appropriation of net profit for the year, which shows total assets of €33,002 million, and to the income statement for the year then ended, presented in the form of a list, which shows a net loss of €139 million. The financial statements cover the 12 month period from January 1 to December 31, 2020. The financial statements for 2020 were approved for issue by the Board of Directors’ meeting of Renault SA on February 18, 2021. These financial statements are included in the consolidated financial statements of Groupe Renault. Significant events 4.4.2.1 Following the selection process led by the Governance and Compensation Committee, the Board of Directors, meeting on January 28, 2020 under the chairmanship of Mr Jean-Dominique Senard, made the decision to appoint Mr Luca de Meo as Chief Executive Officer of Renault SA, and Chairman of Renault s.a.s, effective July 1, 2020. Ms Clotilde Delbos continued as Interim Chief Executive Officer of Renault SA until Mr Luca de Meo took up his new function. The Board of Directors also expressed a favorable opinion regarding her appointment as Deputy Chief Executive Officer of Renault SA from July 1, 2020. As part of Renault’s new strategy for China, which has two main focuses, light commercial vehicles and electric vehicles, Groupe Renault entered into an agreement with Dongfeng Motor Corporation for the transfer of Renault SA’s shares in DRAC to Dongfeng, for 1 yuan. DRAC ended its Renault brand-related activities as of April 1, 2020. This transfer took place on April 30, 2020 and generated a loss of €155 million. Nissan’s financial year ended on March 31, 2020 with a net loss of €5,589 million (-¥671.2 billion) and Renault SA received no dividends from Nissan during the 2020 financial year. In the context of the COVID-19 pandemic that appeared in the first quarter of 2020 and continued throughout the financial year, the global automotive market suffered a downturn of 14.2% compared to 2019. To protect its employees, and in compliance with the measures introduced by national governments, Groupe Renault suspended its commercial and production activities in most countries during March. Furthermore, during the lockdown periods, almost all employees not working in production and sales worked from home, and furlough measures were put in place. Production and sales resumed mainly from May 2020, respecting the end-of-lockdown measures imposed by the governments of the countries where Groupe Renault has operations. A second lockdown and curfews were imposed in several countries, including France, during the second half of the year, and these also had negative effects on the Group’s business activity. The Annual General Meeting of June 19, 2020, upon the proposal of the Board of Directors, decided not to distribute a dividend for 2019. On May 20, 2020, Renault SA signed a credit agreement for a maximum amount of €5 billion covered by a French State guarantee. The main characteristics of this credit line are the following: the maximum total credit was €5 billion, which could be drawn in P whole or in part on one or more occasions, until December 31, 2020; the initial maturity for each drawdown was 12 months, with the P option to extend the maturity by a further three years, with repayment of one-third each year; the French State guarantee covers 90% of the total amount P borrowed; the interest rate on each drawdown is indexed on the 12-month P Euribor for the first year, then the 6-month Euribor for any extensions; early repayment after extension is possible during the term of the P credit, for a principal amount of at least €500 million; it concerns a pool of five banks: BNP Paribas, Crédit Agricole, P HSBC France, Natixis and Société Générale. Renault SA has made three drawdowns totaling €4 billion: €2 billion drawn on August 5, 2020, €1 billion on September 22, 2020 and €1 billion on December 23, 2020. The remaining €1 billion credit was no longer available at December 31, 2020. In November, Renault issued a new bond with nominal value of €1 billion. At December 31, 2020, Renault SA had sufficient cash and sources of financing to ensure continuity of operations for the next 12 months, and had demonstrated its capacity to issue debt in the second half of the year. Accounting policies 4.4.2.2 Renault SA has drawn up its annual financial statements in accordance with the provisions of regulations 2014-03 of the ANC ( Autorité des Normes Comptables ), approved by ministerial decision of September 8, 2014 concerning the French chart of accounts. The following methods were applied in valuing balance sheet and income statement items: Investments A. As allowed by CNC ( Conseil National de la Comptabilité ) notice no.34 (July 1988), as an alternative to the standard valuation method for investments carried in the balance sheet, Renault SA has opted to state investments in wholly-controlled companies at equity: