THE ESSENTIALS · 2020-04-28 · 2019 annual report 9 the essentials 01 the econocom galaxy 2. The Econocom galaxy An agile organisation for sustainable digital transformation Econocom

THE ESSENTIALS01. 5

For a useful digital transformation that makes sense1. 7

The Econocom galaxy2. 9

2019 Key figures3. 10

Performance and share capital4. 12

Governance5. 14

GROUP OVERVIEW02. 17

Group history1. 20

2. Group structure 22

Group positioning3. 24

Financial position and results4. 42

Corporate Governance5. 47

Research & Development6. 62

Principal investments7. 64

Additional information8. 66

CORPORATE SOCIAL RESPONSIBILITY03. 67

Our approach 68

Actions and highlights 69

Nurture our excellence through responsible commitment1. 72

Support the new responsible uses of our customers and users2. 86

Federate an ecosystem to create shared value3. 90

RISK FACTORS04. 97

Operational risks1. 98

Regulatory risk2. 101

Dependency risk3. 102

Financial risk4. 103

MANAGEMENT REPORT05. 107

Group's financial position and highlights1. 108

Profit for the year2. 111

Risk factors and disputes3. 124

Outlook for 2020 and shareholders' compensation4. 124

Corporate governance statement5. 125

Subsequent events6. 146

CONSOLIDATED FINANCIAL STATEMENTS06. 147

Consolidated income statement and earnings per share1. 148

Consolidated statement of financial position2. 150

Consolidated statement of changes in equity3. 152

Consolidated statement of cash flows4. 154

Notes to the consolidated financial statements5. 156

SHAREHOLDERS07. 255

Share performance and shareholders1. 256

STATUTORY AUDITOR’S REPORT ON THE CONSOLIDATED 08.FINANCIAL STATEMENTS 273

Statutory auditor’s report to the general shareholders’ meeting on the consolidated accounts 274

CHAIRMAN’S STATEMENT09. 281

CONDENSED PARENT COMPANY FINANCIAL STATEMENTS10. 283

Parent company statement of financial position1. 284

Parent company income statement2. 286

Parent company statement of cash flows3. 288

KEY CONSOLIDATED FIGURES11. 291

2 2019 annual report

32019 annual report

chairman’s message

2019 was a pivotal year during which our hardwork brought the Group back to growth withoperating profit up 14%. In addition, extremelyrobust cash management measures, asuccessful ongoing cost reduction plan andinitial sales of non-strategic assets haveenabled us to keep a firm hand on our netdebt.

Throughout the year we have proven wecan successfully manage high calibretransformation projects for our customers.We are listening to our customers morethan ever to ensure the digital solutions webuild with them are 100% fit for purpose.With the innovation and synergy of oursolutions, our excellent delivery, unfailingcommitment and pertinent business modelspanning the entire digital value chain, ourcustomers know they can rely on us for thesuccess and financing of their projects, largeand small.

Early 2020 I appointed a close-knit, highlyexperienced team of managers who knowour markets inside out and understand thecomplementarity of our business lines.

This team will work with us to implementour strategy to:

strengthen our legacy business line,•financing;

refocus our Services on areas with higher•potential for growth and added value,moving away from activities which requireglobal coverage or contribute too little;

sustain the solid growth of our Products &•Solutions activities in key geographicalregions, a growth that is driven by highervolumes of professional equipment and anincrease in teleworking.

Our ongoing objective is to keep net debtunder control. To do this, we are goingto steadfastly pursue the transformation planwe embarked on at the end of 2018 to furtheraccelerate our growing competitiveness ndoperating margin.

This will return us to the path to sustainablegrowth, backed by solutions which meet allour customers' criteria in a world where theway we work and live our lives is changingsignificantly. We will also need to step up thepersonal and professional development ofthose who drive the business forward andconstantly inject innovation into ourproducts.

At the time of writing, as we experienceunprecedented circumstances anduncertainty, I am confident in our ability tostand strong and recover.

Jean-Louis Bouchard

Chairman of the Board of Directorsand Chief Executive Officer


52019 annual report

01the essentials

For a useful digital transformation 1.that makes sense 7

The Econocom galaxy2. 9

2019 Key figures3. 10

Performance and share capital4. 12

Governance5. 14

72019 annual report

01the essentialsfor a useful digital transformation that makes sense

For a useful digital 1.transformation that makes sense

With a presence in 18 countries, Econocom designs, finances and facilitatesthe digital transformation of large companies and public organisations. 360°digital experts, we are convinced that digital technology is not an end in itselfbut a way to make the end-user's everyday life easier. In other words, theinfrastructure, hardware and applications have only one purpose: to be usefulto the user and thus create sustainable and shared value.

User satisfaction: a key success factor for digital transformationAt a time of constantly-changing technology, of ever-shorter shelf lives, we areconvinced that it is essential to return to the value of use, which is by nature astable benchmark, to ensure that digital transformation is successful,firmly-rooted in organisations, and creates sustainable value for everyone.

This user- and use-oriented approach is not new at Econocom. It has been thecore of our DNA for more than 40 years. Every day, we strive to offer ourcustomers digital solutions which are really useful to them and make sense.This translates into a working method that informs all our decisions, in each ofour three business lines — services, distribution and financing.

Starting with employees' actual use to distribute the right equipment,deploybe spoke services and offer flexible and original financing solutions, Econocomhelps companies successfully complete their digital transformation andensure the performance of their digital projects.


01 THE ESSENTIALS

CYBERSÉCURITY DIGITAL.SECURITY ● EXAPROBE

MICROSOFT ALTER WAY ● DIGITAL SECURITY ● INFEENY

WEB APPS, SAAS & CLOUD

ALTER WAY ● ARAGON-ERH ● ASP SERVEUR ● ECONOCOM BRASIL ● NEXICA ● SYNERTRADE

INFRASTRUCTURE & NETWORKS

ALTER WAY ● ASYSTEL ITALIA ● ASP SERVEUR ●EXAPROBE ● NEXICA

MOBILITYALTER WAY ● BIZMATICA ● DMS ● ECONOCOM BRASIL ● GIGIGO ● JTRS ● RAYONNANCE

DIGITAL SIGNAGE & MULTIMEDIA

ALTABOX ● CINEOLIA ● ENERGY NET

CONSEIL FIFTY EIGHT ● HELIS

92019 annual report

01the essentialsthe econocom galaxyx

The Econocom galaxy2.

An agile organisation for sustainable digital transformation

Econocom has adopted a unique organisational model, enabling it toimplement its development strategy: the “Galaxy”.

The Planet: the group’s three legacy professions

At Econocom, we do business for the benefit of our customers and completelyindependently from manufacturers, telecom operators, software vendors andfinancial companies. A digital pioneer for 45 years, the Group is the only playeron the market to combine technological and financial expertise through threeactivities:

Financing: as a pioneer and leader in digital transformation financing,•Econocom offers flexible and original financing solutions aligned with newmethods of digital consumption: pay-as-you-go, subscriptions, etc.

Services: personalised services to complement our customers' digital•projects and quickly meet their business needs. These fall into three majorareas: services to users with the Modern Workplace offer, cloud andinfrastructure services and lastly digital transformation services with ourexpertise in applications and data engineering.

Distribution: Econocom supports companies in the implementation of•“turnkey” solutions as a service, integrated into their professional anduser-oriented environments, from installation assistance, through storage,maintenance and recycling for all digital equipment.

Satellites: successful SMEs, positioned in strategic digital segments

Expert and autonomous SMEs, positioned in the most promising digitalsegments, the Satellites effectively complement Econocom’s historical offersand drive its growth. The heads of these companies retain a significant shareof the capital and have strong management autonomy to preserve theiragility.

This model, which combines Econocom’s industrial power with the agility of itssatellites, enables us to offer our customers comprehensive, tailor-madesolutions integrated throughout the digital value chain. As their digitalchallenges evolve, we offer them solutions that are made for them rather thansolutions they will find everywhere.


01 the essentials2019 key figures

2019 Key figures3.

Consolidated revenue (in € millions)

Revenue by business

Recurring operating profit(2) (in € millions)

Recurring operating profit by business

The 2018 income statement has been restated.(1)Before amortisation of intangible assets from acquisitions.(2)

112019 annual report

01the essentials2019 key figures

Shareholders’ equity (in € millions)

* Adjusted.

Net debt (in € millions)

Breakdown of staff at 31 December 2019


01 the essentialsperformance and share capital

Performance and share capital4.

Distribution of capital at 31 December 2019

Basic earnings per share (in €)

Recurring earnings per share (in €)

Compensation per share (in euro cents)

Refund of issue premiumAt the Annual General Meeting to be held on 19 May 2020, the Board of Directors will recommend that shareholders receive a refund of the issue premium, considered as paid-in capital, in the amount of €0.12 per share.


01the essentialsperformance and share capital

Change in the share price

Year Highest(in €)

Lowest(in €)

Last(in €)

Average daily volume ofshares traded

2017 8.00 5.75 5.96 399,425

2018 7.30 2.28 2.91 833,060

2019 4.01 2.0 2.43 210,320

Change in market capitalisation

Shareholders’ agendaThe Econocom group share is listed on the Eurolist market (Compartment B) of Euronext Brussels and is included in the Bel Mid and Family Business indices

Code ISIN: BE0974313455

23-04-2020Release of Q1 2020 revenue after trading19-05-2020Annual General Meeting29-07-2020Release of 2020 half-year results after trading10-09-2020Meeting to review the 2020 half-year results22-10-2020Release of Q3 2020 revenue after trading

Real-time financial information:www.econocom.comhttp://finance.econocom.com


01 the essentialsgovernance

Governance5.At 31 December 2019

Board of Directors

Chairman and Chief Executive Office

Jean-Louis Bouchard

Vice-Chairman

Robert Bouchard

Executive Directors

Bruno Grossi

(Managing Director)

Non-Executive Directors

Véronique di Benedetto

Jean-Philippe Roesh

Gaspard Dürrleman

Rafi Kouyoumdijan

Independent Directors

Walter Butler

Adeline Challon-Kemoun

Anne Lange

Marie-Christine Levet

Jean Mounet


01the essentialsgovernance

Executive Committee

Chairman and CEO

Jean-Louis Bouchard

Group Financial Controller

Eric Bazile

Group Finance Director

Angel Benguigui

Country Manager ENEA

Laurent Caparros

Country Manager Belux

Chantal De Vrieze

Managing Director P&S France

Philippe Goullioud

Executive Director

Bruno Grossi

Managing Director TMF France

Éric Lucas

Managing Director Services France

Laurent Roudil

Statutory AuditorPricewaterhouseCoopers

Company auditors, limited liabilitypartnership (srl) represented byAlexis Van Bavel

01 the essentials



02group overview

Group history1. 20

Group structure2. 22

Group positioning3. 24

Technology Management & 3.1.Financing 25Products & Solutions3.2. 26Services3.3. 28Digital solutions offered by 3.4.Econocom Satellites 30Combination of Planet and Satellite 3.5.know-how 39

Financial position and results4. 42

Highlights of the past three years4.1. 42Consolidated data for the year: 4.2.comparison between 2018, 2017 and 2016 43Equity restrictions4.3. 46

Corporate Governance5. 47

Board of Directors and Advisory 5.1.Committees 47Conflicts of interest5.2. 58Biographies of Directors5.3. 59

Research & Development6. 62

Principal investments7. 64

20177.1. 6420187.2. 65In 20197.3. 66

Additional information8. 66

Legal and arbitration proceedings8.1. 66Major contracts8.2. 66


02 GROUP OVERVIEW

•“Everything we have learned over the last forty-five years, we’ve learned from our customers. We have

always invented our products and services with their help.”

Jean-Louis BouchardEconocom’s Founding President


02group overview45 years of intuition, daring and independence

Preamble

45 years of intuition, daring and independence

When Jean-Louis Bouchard created ECS in 1974, he deployed an economic model thereto unknown in the IT sector, in response to a customer request: leasing. The company began by renting IBM machines.Keen on preserving its independence, it quickly established partnerships with most of the other manufacturers, becoming their indispensable financing partner. This mix of intuition, daring and independence, which was at the origin of the creation of Econocom, is still part of the company's values today. It has always been at the heart of the company's decisions, as it has grown and diversified

From leasing to services, including distribution and telecommunications

Econocom began to diversify its business lines in the 1990s, by buying the Belgian IT distribution leader, Asystel Belgium. At that time, Jean-Louis Bouchard had already understood the importance of the distribution channel, against the backdrop of declining mainframe sales and the explosion in personal computers. In 2000, Econocom was still playing on the element of surprise, being one of the first IT players to invest in telecoms, anticipating the coming IT convergence. 2013 was marked by the strengthening of the Group in terms of services: the acquisition of the service provider Osiatis allowed Econocom to become a leading digital services company.

Agility through Satellites

After acquiring Osiatis, the Group counted more than 8,000 employees. In order to maintain its agility despite having become a large group, Econocom invented in 2014 an unprecedented development model: the "Galaxy" with its innovative SMEs, all positioned in strategic areas (cybersecurity, cloud, mobility solutions, open source, etc.). The objective? To invent Econocom's future, in synergy with the Group's different activities, and in line with the uses and needs of users.


02 group overviewgroup history

Group history1.1974Jean-Louis Bouchard founds the Groupunder the name Europe ComputerSystèmes (ECS) in France.

1985Jean-Louis Bouchard sells his stake inECS France to Société Générale but buysback all the foreign subsidiaries.Meanwhile, he acquires Econocom, anAmerican SME. The subsidiaries andGroup are renamed “Econocom”.

1986Econocom Belgium is listed on theSecond Marché of the Brussels StockExchange.

1993Acquires Asystel Belgium, makingEconocom Distribution the leading ITdistributor in Benelux.

1996Econocom is listed on the PremierMarché of the Brussels Stock Exchange.

2000Following the public exchange offer onInfopoint group, Econocom is listed onthe Second Marché of the Paris Bourse.The Group diversifies by establishingEconocom Telecom, anticipatingconvergence between IT and telecoms.

2001The Group employs 2,000 people.

2002Acquires Comdisco-Promodata in France(administrative and financialmanagement of IT assets).

2004/2007

the acquisition of Signal Service France,the corporate activity of Avenir Telecom,followed by the corporate division of ThePhone House France.

The Group steps up the pace of itsdevelopment in the telecoms market with

In 2007, the Group doubles its capacity inItaly with the acquisition of Tecnolease,an Italian company specialising incomputer hardware leasing.

2008Acquires Databail, a French ITinfrastructure financing company.

2009Opens a nearshore remote servicefacility in Rabat, Morocco.

2010Econocom acquires ECS from SociétéGénérale and becomes the number onecompany in Europe in TechnologyManagement & Financing.

2013Econocom merges with Osiatis group,thus making decisive headway in thedigital services market. As a result of thisacquisition, Econocom earns almost€2.0 billion in proforma revenue, including€650 million in business-to-businessdigital services. The Group now employs aworkforce of more than 8,000 people in 20countries.

2014Econocom Group issues €175 millionworth of bonds convertible into cashand/or new shares and/or exchangeablefor existing shares (ORNANE), due tomature in 2019. The proceeds from thisissue are used to strengthen Econocom’sfinancial resources, particularly in thecontext of its Mutation strategic plan.


02group overviewgroup history

2015Econocom joins the Tech 40 index,selected by EnterNext from among 320listed European high-tech stocks.In May,Econocom completes a €101 millionprivate placement (Euro PP) split into twotranches with maturities of five and sevenyears, and coupons of 2.364% and 2.804%respectively. This helps strengthen,diversify and disintermediate the Group’sfinancial resources while furtheroptimising the financial conditions of itsborrowings.Econocom Group becomes aEuropean company (societas europeae)on 18 December 2015 to reflect itsEuropean identity and ambitions.Lastly,Econocom implements an externalgrowth strategy geared towardsacquiring majority stakes inmedium-sized companies offeringsubstantial scope for entrepreneurship. Inthis context, either directly or through itssubsidiary Digital Dimension, the Groupcarried out several acquisition andinvestment operations, particularly in thearea of security: Altasys, Clesys, EconocomDigital Security and one of the leadersspecializing in open source with AlterWay.

2016Econocom now employs over 10,000people .At end-November, EconocomGroup took advantage of favourablemarket conditions to launch aSchuldschein loan issue (privateplacement under German law) in a totalamount of €150 million, therebyincreasing its financial resources. Duringthe year, Econocom Group continued itsoriginal “Satellites” external growthstrategy, acquiring either directly orthrough its subsidiary Digital Dimension.

2017Seven acquisitions are made:•

new Satellites: Aciernet (acquired by•Exaprobe), LP Digital (acquired by AlterWay), Energy Net in Germany, JadeSolutions and JTRS in the UnitedKingdom;•

new Planet members: BIS in the•Netherlands and Belgium, and Biboardin France.•

In April, Econocom completes the early•conversion of its January 2014 ORNANEbonds due in 2019, boosting equity by€183 million.

The Group meets the targets set in 2012for the Mutation strategic plan (doublingrevenue and profit from continuingoperations) and presents its new five-yearstrategic plan “e for excellence”.

2018The Group employs 10,700 people.Econocom secures its financing by issuinga convertible bond debt (OCEANE) for€200 million in March and maturing in2023. Two external growth operations arecarried out in the first half of the year tosupplement the existing positions inServices in Italy (BDF) and in Spain(Altabox).

The new management’s focus in thesecond half of the year on reducingworking capital requirements allows forcash generation to be bettered and netdebt reduced.

2019The Group decides to shift its focus backto its historic business "TMF" and to allthe synergistic activities with it withinDSS.

The Satellites Jade and Rayonnance aresold and 13 other non-strategic activitiesare identified in order to be sold orclosed.

At the same time, the Group launches amajor cost savings plan of €96.5 millionspread out over three years, with thirtymillion already saved in 2019.


02 group overviewgroup structure

Group structure2.


02group overviewgroup structure


02 group overviewgroup positioning

Group positioning3.Econocom, 360° expert in digital transformation

A leading player in digital services in Europe,the Group supports the digitaltransformation of companies throughoutthe entire value chain: from consulting tomanagement, through the design ofsolutions, their implementation and theirfinancing. Regardless of the services oroffers deployed, Econocom helps itscustomers think about and use digitaltechnologies effectively, placing end usersand their uses at the starting point of anydigital transformation.

The strengths of the Group

Econocom group stands out from itscompetitors thanks to:

45 years’ experience in business•infrastructure management;

a unique combination of expertise•coupling financial innovation withtechnological expertise;

its dual IT and telecommunications•expertise;

its independence from IT hardware•manufacturers, telecom operators,software vendors and financial companies.

Thanks to its presence in 18 countries,mainly in Europe, but also in Morocco, Brazil,Mexico, Canada and the United States, theGroup is able to meet the needs of its majorcustomers, regardless of the geographicalarea in which they operate.

A unique development model

In addition, its unique development model,the Galaxy (made up of the Econocom“Planet” with its three historic andcomplementary business lines and its“Satellites”, with advanced skills embodiedby expert and autonomous SMEs), helps putEconocom at the forefront of key areas suchas security, web and mobile applications,digital solutions, open source and digitaltransformation consulting. This relationaland organisational system addresses thechallenges of the digital revolution. Thisrevolution forces organisations to operate ina different way, with collaborative andtransversal organisations that take priorityover hierarchical and vertical structures.

The five pillars of the Econocom offerderived from this unique model are:

Technology Management & Financing•(see page 25);

Products & Solutions (see page 26);•

Services (see page 28);•

the digital solutions of the Satellites•(Cybersecurity, Microsoft, web apps, SaaS &Cloud, Infrastructure & Networks, Mobility,Digital Signage & Multimedia, Consulting)(see page 30);

the combination of Planet and Satellites•expertise: “end-to-end” transversal offers(see page 40).


02group overviewgroup positioning

Technology 3.1.Management & Financing

MARKET: A DEMAND FOR 3.1.1.GREATER FLEXIBILITY

Consumption oriented towards use ratherthan ownership, seeking solutions formaking costs more flexible, developing thecircular economy: these phenomena haveencouraged the development of newmethods of financing (rental, variable rents,etc.).

Use rather than ownership

Boosted by a fast-growing digitaltransformation market, the trend ofconsumption based on use rather thanownership is gathering strength. Whiletraditional consumption patterns are stillpresent, especially for strategic hardware,which large companies continue to want tokeep control of, a mixed model is emergingin the IT and digital segments. Increasinglyaccustomed to the new standards of digitalleaders, companies are now seekingsolutions to improve the customer andemployee experience, while favouring anapproach based on return on investment,while making their costs more flexible at thesame time.

A trend reinforced by changes in accounting standards

technologies and associated servicepackages.

This trend to make costs more flexible islikely to be strengthened in the comingyears by developments in IFRS coming intoforce in 2019. Companies that seek todeconsolidate their assets with a materialunit value will have to hand over control ofsaid assets to service providers who will inturn use the assets to provide acomprehensive service or will chargevariable rents for their use. In this context,they will have to rely on partners able tooptimise the underwriting of theirequipment with relevant advice, thanks totheir strong knowledge of rented

Leasing boosted by the circular economy

The circular economy is another notablemarket trend. It has led to the developmentof the leasing model, which relies on anorganised and structured reuse andrecycling channel. This model allowscompanies to rely on specialists for theresponsible and sustainable managementof their equipment.

ECONOCOM: À LA CARTE 3.1.2.FINANCIAL SOLUTIONS

A pioneer in leasing, the Econocom groupgenerates 38.4% of its revenue through theTechnology Management & Financingbusiness. Today, the offer responds, morethan ever before, to companies’ expectationsregarding financing. While 30% of thembelieve that the lack of financial resources isthe greatest obstacle to their digitaltransformation(1), Econocom offers a widerange of adapted financial solutions. Thesesolutions enable them to fast-track thecompletion of digital projects (connecteddevices, mobility, business hardware, IT &multimedia, industry hardware, energy, etc.),while meeting the financial and operationalconstraints of the players (CFOs, CIOs) andbusiness lines involved.

Linearised payment methods

Ever attentive to its customers’ needs,Econocom offers all-inclusive or à la cartefinancial solutions, combining several of itsareas of expertise with a linear paymentmethod, resulting in a comprehensive rangeof leasing solutions and usage- orunit-based invoicing for services, rangingfrom general scalable lease contracts tosubscription service agreements. Thiscontractual flexibility enables the Group torefresh assets on a regular basis andguarantee budget stability.

Econocom, Sia Partners and Ifop.(1)



Asset management service

In addition, Econocom delivers effectiveasset management services, offeringoperational solutions to meet customers’needs and help them manage, monitor andcontrol resources. Customers benefit fromthe Group’s expertise throughout theproduct lifecycle, including the simplifiedmanagement of risks and management ofthe end of the product use cycle, incompliance with the General DataProtection Regulation (GDPR).

Financing of green projects

Econocom also offers financing solutionsfor energy efficiency projects (see part 3CSR report, page 69).

EDFL: the solution for financing the mostcomplex transformation projects

In order to fast-track the roll-out of its mostadvanced digital solutions, Econocom set upa specialised unit in 2014 that gives it thecapacity for financial innovation. EconocomDigital Finance Limited (EDFL) is adedicated, centralised unit specialising inrisk management and financing solutions. Itoffers specific expertise in transactionsecurity and non-standard contractfinancing. Through EDFL, Econocom hasbeen able to boost its independence andrefinancing capacity.

competitors do not have distribution andservice activities. Finally, Econocom is largeenough to guarantee sustainability and abalanced force to its customers, comparedwith major hardware manufacturers andplayers in the digital sector.

Econocom has a unique position in itsmarket, with no directly comparablecompetitors. Its competitors are, for the mostpart, either general or independent leasingcompanies, or specialist subsidiaries ofhardware manufacturers or bank subsidiaryleasing companies. These companies do notshare Econocom group’s same characteristicsof independence or technologicalspecialisation, while independent

Products & Solutions3.2.A CONSTANTLY CHANGING 3.2.1.

MARKET

Companies must embrace the newtechnologies and the growing needs of usersin terms of digitalisation; they are activelyadapting their expenses depending onneeds and on changes in the servicesassociated with technological innovations.

In terms of supplies, the mission issomewhat complex for the CIO, who mustintegrate purchases of materials,subscriptions, licenses, contracts, tickets,commissioning fees, etc. with growingneeds in terms of digital transformation,agility, confidence, user experience andoperational excellence.

Innovation remains the driver ofdevelopment through changes intechnologies and in business models.

In this context, Econocom Products &Solutions is developing its positioningaround “turnkey” solutions by proposing AsA Service offers: a unique subscription forfinancing devices, applications andassociated services. An even morecomprehensive solution around productsadapted to and associated with additionaltailor-made services for builders andsoftware vendors who assist companies ininnovating, daring, adapting andrebounding for good in order to meet alltheir development needs:



Consulting in the design and architecture•of solutions;

Supply, storage and deployment;•

Integration and environmental security;•

User support, assistance with change;•

Management of product life cycles;•

Developing offers as a service.•

Econocom Products & Solutions uses,provides and develops efficient up-to-datetools: wide-ranging product base, hardwareconfigurations, services configurations,extranet, tracking, supporting operationalexcellence and a relevant “Go To Market”.

Termination of Windows 7 support,migrations to Windows 10, and limits onavailability of Intel processors were factors inthe momentum of 2019 results in terms ofvolume and value.

INTELLIGENT WORKPLACE, 3.2.2.A NEW DIMENSION

If there is one notion making its way aroundbusiness circles, it is the notion of “office”.From a fully-equipped fixed physical station,the office is now any place from which youcan work to boost productivity andsometimes it is not even an office. Of course,the boom in mobility has a lot to do with it.

These new user needs require a choice ofproducts and adapted accessories, ready foruse, the “zero touch”, enrolment, and MDMsolutions for secure efficient deploymentsupporting hyper-personalisation withautonomous users and transparentintegration.

Econocom Products & Solutions acts as anintegrator of digital solutions to meet theneeds of customers and simplify the dailylives of users. Econocom is a unique playerin that it offers value-added supplies,additional services for its partnermanufacturers (mainly Lenovo, DellTechnologies, HPinc, Apple, Samsung,Microsoft amongst more than 2,000 assetswho recognise Econocom for its technicaland business skills, its commitment, itsquality of service, validated by high levelcertifications, and for its knowledge ofmarkets and customers, both private andpublic. 30% of device purchases will be DaaS(Device as a Service) by 2025, according toIDC (IDC PCaas MCS).

FRANCE’S SECOND LARGEST 3.2.3.PLAYER IN DISTRIBUTION

In a dynamic, highly competitive market withmore than 14,000 computer resellers inFrance, Econocom remains second (behindSCC) in this distribution market with 5%growth in 2019.

In the European market, it competes withComputacenter, SCC, Bechtle, Axians,Insight, Softwareone or Realdolmen.

In this complex context, EconocomProducts & Solutions acts as a “one stopshop”, assisting its customers fromend-to-end and working to develop digitaluses to emphasise the importance of themand make them more attractive whilekeeping up with increasing needs and withthe increasingly complete life cycle ofcomputer equipment.



Services3.3.A GLOBAL MARKET UP 5%3.3.1.

The digital services market performed wellin 2019. This should continue in 2020 with agrowth estimate of 4.4% for the EMEA(Europe, Middle East, Africa) zone, accordingto the firm Teknowlogy/PAC. An even morepositive trend internationally, with 5.7%growth in 2019 and 5.3% expected for 2020.

For France, Syntec Numérique/IDC in itsreport released in December 2019, predictsdifferentiated progress depending on typesof services: +2.9% for consulting and servicesdelivered by digital services companies,+6.6% for software vendors and +4.4% fortechnology consulting, which is an averageof 4.0% growth for 2020.

This sector will then account for more than€60 billion, of which 60% will come fromconsulting and services delivered by DSC.

Still according to Syntec Numérique/IDC, itis the transformation plans what willsupport growth. SMACS (projects around“Social, Mobility, Analytics, Cloud, Security”)will account for €16.5 billion with growth of16.5% between 2019 and 2020.

For consulting and services delivered byDSC, the growth engine for 2020 is based onnew, high value-added offers (cybersecurity,artificial intelligence, cognitive systems) andthe development of cloud services.

The sectors driving growth are “Banking -Insurance - Finance”, “Services toprofessionals” and “Utilities”.

Lastly, the digital sector continues to boom,creating jobs for the tenth year in a row,increasing the workforce by more than510,000 jobs in 2019, with growth of +7.1%(excluding software) or six times moredynamic than the private sector as a whole(+1.2%).

THE THREE PILLARS OF 3.3.2.THE ECONOCOM OFFER

The Services activity of the Econocomgroup is developing personalised services tocomplement its customers’ digital projectsand quickly meet their business needs. Our8,300 Services employees located in tencountries operate in three major areas:services to users with the ModernWorkplace offer, cloud and infrastructureservices and lastly digital transformationservices with its expertise in applicationsand data engineering.

Services to Users

Users want to receive in their companyservices aligned with the highest standardsof richness and quality from A to Z. TheInformation Systems Department (ISD) musttherefore offer them new services tocorrespond to new uses.

To assist them, Econocom designs,integrates and manages digital workplaceenvironments, generally known as “DigitalWorkplace” made up of:

IT infrastructure cloudified;•

cloudified office suite;•

standardised user devices;•

digitalised service desk;•

reinvented convenience services.•

Moreover, Econocom is ranked by the firmTeknowlogy/PAC as the leading player in theusers’ outsourcing market in France for thethird straight year.

Furthermore - through its satellite Infeeny,a Microsoft pure player - received from thesoftware vendor the title of partner for theyear 2019 in its “Modern Workplace -Microsoft 365 & Surface” category.


02group overviewroup positioning

Services to users are being transformedwith the hyper-automation of the workenvironment (PCs are now behaving likesmartphones) and the emergence of usersupport boosted by artificial intelligence.

For reasons of productivity and quality, theservice desk is delivered from our ownservice centres located in France andMorocco.

Services around the cloud and infrastructures

To meet the growing needs of customers,employees and partners of its ecosystem,the Information Systems Department (ISD)must provide IT services available 24/7,which are ever more efficient, flexible andsecure and at the lowest cost.

Econocom transforms, implements andoptimises the IT services of its customers bycomplying with the new market trends,particularly hyper-automation and thecloud distributed.

The four major services that position theGroup as one of the leaders in themanagement of cloud and traditionalenvironments are:

consulting;•

transformation;•

managed services;•

and maintenance.•

Our cloud advisers assist customers inadopting the cloud, providing insights intothe business, technical, financial,operational effects as well as the effects interms of organisation and security ofadopting the cloud.

Our cloud architects assist our customers increating a secure, reliable and efficientcloud environment and transferring theirworkloads to them, while guaranteeingoperational excellence.

Our managed services cover themanagement of IS from businessapplications, security, IT data toinfrastructure. Econocom operates theinfrastructures of its customers whereverthey are hosted: with the customer or on themajor public cloud platforms, MicrosoftAzure, Amazon or Google. For the samereasons of productivity and quality, ourcustomers’ production infrastructuremanaged services are delivered mainly fromour own service centres located in Franceand Morocco.

Maintaining the data centre infrastructuresis crucial to ensure the continuity of ourcustomers’ business. Econocom is rankedby Teknowlogy/PAC as the leadingindependent player (not includingmanufacturers in captive markets) on theFrench data centre maintenance marketfor the fourth consecutive year.

The Group offers its own IAAS(Infrastructure-as-a-Service) and PAAS(Platform-as-a-Service) from highly availableand secure cloud infrastructures based inFrance (delivered by ASP-Serveur, Alter Wayand Econocom) in Spain (by Nexica) and inBenelux (by Econocom).

Its Satellite Asystel, in Italy, offers a completeplatform of digital services, with wideexpertise in the areas of consulting,infrastructure and cloud outsourcing,security and applications architecture.



Digital transformation through our expertise in applications and data engineering

In an ever fiercer competitive context, TimeTo Market is a key criterion for ourcustomers. Therefore, applications mustevolve along with the needs expressed bythe business lines. Econocom assists itscustomers in deploying the DevOpsapproach, based on agile design anddevelopment and continuous integrationand deployment. Services are deliveredmainly in our service centres in France.

Data management and valuation is anotherkey criterion. To take full advantage of it,Econocom has placed data at the heart ofits development model through thecreation of an Advisory Data division aimedat defining the conditions of a new growthstrategy and helping companies to widenaccess to the use of data in theirorganisations to benefit the most from it.

ECONOCOM: ISO 27001 3.3.3.CERTIFIED

awareness training for Services employees viaMOOCs (Massive Open Online Courses).

IT security is a major challenge for Econocomand the Group continues to make progress inthis area. The Group has been ISO 27001(1)

certified since 2016. This certification is theworld’s most widely recognised informationsystems security standard. This certificationcovers all of Econocom’s Services businessesin France. The actions and measures taken tocombat cybercrime in 2017 were extendedacross all the Group’s business lines, with theblanket rollout of a series of securitymeasures to protect workstations, thestrengthening of Information SystemsDepartment security expertise within the ITDepartment, and the creation of mandatory

ECONOCOM: FRANCE’S 8TH 3.3.4.LARGEST DIGITAL SERVICES COMPANY

Ranked as France’s 8th largest digitalservices company in 2019, Econocomcompetes with companies like Capgemini,Orange, IBM, Atos and Accenture on theservices market. But unlike thosecompanies, it is the only one to combineassociated distribution, management andfinancing services. Digital solutions offeredby Econocom Satellites

Digital solutions 3.4.offered by Econocom SatellitesLaunched in 2014, the Satellite modelenables Econocom to rapidly take up aposition on buoyant markets, (cybersecurity,cloud, mobility, etc.). Econocom Satellites areinnovative SMEs, whose areas of expertisecorrespond to the strategic challenges ofdigital transformation today. In 2019, theyaccounted for 24% of the Group’s revenue.

CYBERSECURITY3.4.1.

A critical issue, a dynamic 3.4.1.1.market

Cybersecurity is a critical component ofdigital transformation and is one of thefastest growing segments of the IT market.With the digital revolution gaining traction,the uses made possible by newtechnologies are placing greater emphasison the security of IT systems.

ISO standard 27001 concerns security and information management systems and helps organisations. (1)"More information here: https://www.iso.org/fr/isoiec-27001-information-security.html".



The amount of digital data is multipliedby eight

According to the IDC study (Data Age 2025),the total global datasphere is expected toincreased eightfold over the coming years toreach 163 trillion gigabytes. All businesssectors and models will be affected, fromB2B to B2C. Though this exponential growthin the volume of digital data may offer newvalue-creating analyses, it also posesproblems in terms of their protection andownership.

The number of mobile devices and IoTwill double by 2020

According to recent studies, there arecurrently more than 3 billion smartphonesand over 20 billion connected devicesworldwide by the end of the year However,this raises the number of zones at risk andpoints open to attack.

80% of European companies have alreadyhad their computers hacked(1)

The proliferation of computer attacks andthe existence of an active, more or lessprofessionalized external threat, boost themarket.

intelligence, Big Data, blockchaintechnology and even cloud computing areopening up massive growth prospects forsecurity, which must and should be seen asan essential component of any digitaltransformation project.

Beyond the exponential growth in thenumber of devices and data, there are otherfactors that explain the strong marketdynamics. The introduction of new andincreasingly restrictive regulations such asthe General Data Protection Regulation(GDPR) and the E-PRIVACY project(2), or theeIDAS European regulation(3), has of coursealso proven to be a driving factor. Artificial

The Econocom offer: 3.4.1.2.Exaprobe and Digital Security

Econocom has chosen to structure itssecurity offering through two complementaryentities. Exaprobe and Digital Security givethe Group a suitable and recognised offer inthe field of information systems security andcybersecurity.

Exaprobe is a benchmark for securingcompanies’ infrastructure and digitalterritories

Acquired in 2013, and now housing CapSynergy (2012), Comiris (2014) and Aciernet(2017), Exaprobe is a security systemsintegrator. It operates in the areas of ITsecurity, network infrastructures andplatforms for unified communication and thedigitisation of workspaces. Its current businessmodel is based on a mix of integrationproducts and services in project oroutsourcing mode. Now, with 300 employeesand revenue of €330 million, Exaprobe hasestablished itself by virtue of its technologicalexpertise and innovative offering. Followingthe acquisition of Aciernet in 2017, it hasspecific expertise in designing and equippinglarge data centres. It boasts high-levelpartnerships with leading manufacturers andsoftware vendors (Cisco, Check Point, HP,Microsoft, etc.).

Source: European Community.(1)European project that aims to strengthen the rules protecting Internet users’ privacy, which may come (2)into force in 2019.Regulation on electronic identification and trust services for electronic transactions, in effect since the (3)second quarter of 2018.



Econocom Digital Security helpscustomers manage their digital risks

digital.security spans three areas ofexpertise: IT system security (ISS), Internetof Things (IoT) security, operationaltechnology security (OT). Our commitmentis fourfold. We promise to:

offer customers high-level expertise in a•package that's right for them without anescalating budget;

assess security and compliance levels•based on technical and regulatorybenchmarks that can be applied to everycontext;

anticipating new usesensure our•customers achieve optimum protection oftheir information assets as quickly aspossible and maintain this level;

unite and involve all stakeholders in risk•control measures that are effective andcoherent.

and running security solutions), training andeducation (passing on technical andfunctional knowledge). digital.security is thefirst TF-CSIRT(1) accredited CERT™ (ComputerEmergency Response Team) IoT and founderof the first IoT security label: IQS (IotQualified as Secured). digital.security is listedon Datadock which means companies canobtain funding for OPCO (OPérateurs deCOmpétences - French skilled operator)training for their employees.

digital.security offers the followingservices: audit (assessing and suggestingimprovements), consultancy (analysing risksand drawing up risk reduction policies),integration and project (managingcross-cutting security projects (IAM,SOC/SIEM, DLP, CASB,…) modellingsolutions), operational security (maintaining

digital.security consultants and experts aremembers of various working groups (ANR,CESIN, CLUSIF, ENISA, AFNOR,IRTSystemX…) and are involved in thestandardisation and promotion of digitalrisks. They are fully conversant with themethods, benchmarks and standards thatapply to IT risk management and hold thecertificates to prove it: ISO 27001, ISO 27005,CISSP, CMMI, ITIL, COBIT…

digital.security is officially recognised bythe European body TF-CSIRTwhichcoordinates relations between the variousCERTs worldwide and and has the ANSSI's(French agency for IT system security)PASSI(2) and PASSI-LPM accreditation (3), soour customers can be sure that the securityaudit services we offer meet their highstandards and are appropriate for thesensitivity level of their IT systems.

TF-CSIRT: Task Force on Computer Security Incident Response Teams.(1)Security Incident Response Teams.[1] IT system security audit provider – Military Planning Law: (2)qualification awarded by the ANSSI.French agency for IT system security.(3)



MICROSOFT TECHNOLOGIES3.4.2.

Market: new business 3.4.2.1.models are changing the game

The French market for Microsofttechnologies has been transformed by thearrival of new business models that areimposing a change of approach forpartners distributing the brand.

In fact, over the last ten years, thecompetition has changed considerably:pure players are consolidating, and thebroadline companies are launching newoffers.

These partners, who are used to sellinglicenses and solutions for server integrationand migration, are now being confrontedwith new needs: leasing licenses,integrating new uses, improving the levelof services and information systems usingsolutions such as SaaS (Software as aService), IaaS (Infrastructure as a Service)and PaaS (Platform as a Service).

Econocom aiming to 3.4.2.2.become a market leader with its Infeeny offering

As a historic partner to Microsoft,Econocom wants to accelerate thisstrategic collaboration by becoming amarket leader, and offer all Frenchcompanies a team dedicated to Microsofttechnologies to support them in theirdigital transformation.

This ambition covers the entire value chain:everything from devices and cloud-hostedapplications, to consulting services, opensource software, collaboration withincompanies and the development ofinnovative services, all in an environmentbased on Microsoft solutions and a uniquevalue proposition: Your Microsoft Specialistas-a-service.

For this, in 2018 Econocom launched theMicrosoft transversal offer “Infeeny byEconocom”. Capitalising on Infeeny brandrecognition, this offer also makes use of thelong-standing expertise of Econocom andother Group entities such as Alter Way andDigital Security.

Infeeny by Econocom represents:

700 Microsoft consultants, experts, DevOps;•

a network of regional agencies and•application service centres;

a unique and multidisciplinary interlocutor•for integrated solutions with customisedfinancing;

three domains of expertise in coherence•with Microsoft: Modern Workplace, App &Infra, and Data & IA;

a strong implication in Microsoft•innovation projects: IA (founding memberof the Impact IA association alongsideMicrosoft).

Infeeny: an exclusive Microsoft pure playerin the Econocom group. Thanks to itsexpertise in Microsoft and Econocomgroup’s business contributions, Infeenyoffers innovative solutions around themodern workplace, modern apps, theCloud and data valuation to providebusinesses with a personalisedenvironment, tailored to business andusers.

SAAS & CLOUD, WEB APPS 3.4.3.AND OPEN SOURCE

Double-digit market growth3.4.3.1.

SaaS & Cloud: services and the cloudhybrid are on the rise

According to Gartner, the adoption ofenterprise SaaS is still relatively new andmany SaaS application providers havefocused more on the functionality of theirapplications and less on the needs of IToperations. This can lead to limitations innative SaaS management consoles,including insufficient reporting, inaccurate



permissions and tedious administrativetasks that require significant manual effort.

Most companies already have some cloudinfrastructures and SaaS solutions in placeand are planning to move in that direction.16% of budgets for cloud solutions areallocated to what Gartner calls “servicesrelated to the cloud”. These are essentiallyservices that organisations need to movetoward a cloud solution in order totransform their operations by adoptingcloud services.

In 2019, more than 30% of new softwareinvestments by technology providersmoved from Cloud-First to Cloud-Only. Thecloud is the foundation, and the hybridcloud is the cornerstone for companieswishing to carry out digital transformations.The size of the cloud market is growingexponentially, and is expected to reach$317 billion by 2022 (Gartner).

In the specific area of HRIS, in 2020, it isexpected that the share of SaaS & Cloud willbe 73% (Gartner 2018).

Web apps and open source: growthrelays on the IA side

new generations of DevOps-orienteddevelopment tools, and cloud technologies.

According to PAC-CXP, the open sourcemarket will see annual growth of 8.1% by2021 for the industry as a whole (+12.6% forpublishing and +7.8% for services),representing about twice the growthforecast for the entire digital sector (+4.2%).The United Kingdom and Germany are insecond and third place behind France,European leader in open source and opendigital. France should maintain this positionuntil 2021. The free software and open sourcesector continues to grow, building onits traditional implementations ininfrastructure, middleware and the web, andis finding new growth vectors through itsstrong implication in the new technologymarket segments: Big Data and AI,

The Econocom offer: 3.4.3.2.Alter Way, Aragon-ERH, ASP Serveur, Econocom Brazil, Nexica, Synertrade

Applications

At the heart of the user experience,applications are the most visible part ofthe daily lives of the Company’s customersand employees. Today, every companymust have powerful business-orientedapplications, developed within shorter andshorter deadlines and adapted to rapidchanges in the market, uses andtechnologies.

To meet the needs of companies regardlessof the sector of activity or business line,Econocom proposes a dual approach:

one stop shop around open source•technologies thanks to the expertise ofthe Satellite Alter Way. This innovativeSME, recognised as a key playerspecialising in web platforms and DevOpsbased on open source solutions, has aservice offer ranging from user experienceto managed services in the cloud includingconsulting, design, development and thirdparty applications maintenance;

off-the-shelf software platforms, in SaaS•or on-premise mode, to rapidly deploynew digital processes.

The Satellite Aragon-ERH, software vendorof the SIRH solution covering the entire HRscope and of an Operational Planningsolution, both full SaaS intended for thepublic and private sectors.

Synertrade offers a SaaS solutiondedicated to purchases, and covering theentire expenditure chain.



Hosting and cloud offers

For Econocom, infrastructure performanceis a key success factor to ensure asuccessful user experience. The Groupsupports CIOs in maintaining very highlevels of performance, integrating moreefficient and flexible cloud offers andenhancing security. As the 9th largest playerin the cloud and datacenter outsourcingmarket in France, Econocom is positioned,with its “Satellites” as a genuine partner ofbusinesses and governments.

The Satellites

Alter Way (France): Alter Way is also a key•player in cloud services in France,specialising in MoveToCloud consultingand the outsourcing of web critical opensource platforms on its own infrastructuresof those of its public cloud partners (Azure,AWS, Google, etc.).

Alter Way has a complete offer ofcontainerisation on Docker, of orchestrationvia Kubernetes and 27/7 management ofthose platforms.

Regularly ranked among the best highavailability web hosters (IP Label/BFMBusiness ranking);

ASP Serveur (France): production•infrastructure host and operator of public,private and hybrid cloud solutions. As aspecialist in mission-critical hosting andpublic and private cloud solutions, ASPServeur owns its infrastructure and has acutting edge, very high securitydatacenter;

Econocom Brazil: strategic consulting,•managed services and outsourcingprojects;

Nexica (Spain): an expert in the hosting•and management of critical applicationsfor 15 years. The company is a key player inthe Spanish market in the cloudcomputing.

Nexica has datacenters in Barcelona,Madrid and Marseille.

INFRASTRUCTURE 3.4.4.& NETWORKS

A market undergoing major 3.4.4.1.structural changes

Businesses need more and better IT•infrastructure

Digitisation, new uses, development ofcloud models: to meet these challenges,the network must play an increasinglyimportant role. In addition to thecommonly accepted intrinsic qualities(performance, availability, durability), it isbecoming increasingly common fornetworks to be required to integrateadvanced functions such as: filtering,optimisation and management of flows(voice, video), virtualisation and quality ofservice measurements. The developmentof forms of collaborative work (for example,videoconferencing) partly explains thistrend.

A strong tendency towards migration to•public cloud systems

Over the last several years companies havebeen shifting their IT workload to the publiccloud.

Cybersecurity, a top priority for•executives and Boards of Directors

In all business sectors, attacks are becomingmore numerous and more complex, with80% of technology managers saying thattheir organisation is struggling to put inplace a strong defence.

New mutations for tomorrow•

These include the growth of Asia forhardware solutions, the use of DevOps forsoftware and hardware, container-firstarchitectures and the increasing use ofartificial intelligence and technology stacksoptimised for machine learning.



The Econocom offer: Alter 3.4.4.2.Way, Asystel Italia, ASP Serveur, Exaprobe and Nexica

To help its customers transform theirinfrastructures, Econocom offers consulting,transformation engineering, optimisationand technological innovation services. Inaddition to its transformation andintegration services, Econocom also offersmaintenance services in operationalconditions throughout the life cycle of theseinfrastructures, thereby guaranteeing itscustomers end-to-end support.

Designing scalable infrastructurescapable of integrating the innovations oftomorrow

Developing flexibly to improve support:Econocom’s approach. The Group advocatestraditional IT solutions together with themost innovative digital solutions (hybridcloud solutions, etc.). This “mix” facilitatesthe digital transition and its adoption byusers. This flexibility also makes possible thedesign of scalable infrastructures capable ofintegrating technological innovations asthey occur over time.

Alter Way: see chapter 3.4.3.2.

Asystel Italia: infrastructure expert (Cloudsolutions, outsourcing)

ASP Serveur and Nexica: see chapter 3.4.3.2.

Exaprobe: see chapter 3.4.1.2.

MOBILITY3.4.5.

A dynamic market driven 3.4.5.1.by the growth of software solutions and service

The enterprise mobility market is dividedinto four main segments:

Connectivity: 3/4/5G mobile networks and•WiFi;

Hardware: consumer and professional•devices and accessories;

Software: off-the-shelf mobile applications,•development platforms, mobilitymanagement solutions such as EMM/UEM(Enterprise Mobility Management/UnifiedEnd-Point Management, etc.);

Services: deployment and management of•a mobile business fleet, user services,mobile application development, EMMservices, etc.

The mobility market is a dynamic marketdriven particularly by the adoption by usersin the private sphere. Thus, according toGartner(1), today the overall market share ofmobile platforms is nearly three times largerthan the share of the historic platformWindows (4.5 billion mobile devices - GoogleAndroid and Apple iOS - compared with1.5 billion for Windows). On a companyscope, the relationship between these twosegments is close to parity (0.85 mobileterminal for 1 Windows terminal in WesternEurope).

As a result, public and private organisationsare arranging to take change of these newuses in their business line and supportstructures. Gartner(2) predicts annual growthof 10.1% in mobility management andsecurity activities to $10.5 billion by 2023.

Gartner, Forecast: PCs, Ultramobile and Mobile Phones, Worldwide, 2017-2023, 4Q19 Update.(1)Gartner, Forecast Analysis: Enterprise Managed Communications Service Growth Trends, 09/2019.(2)



Among the investment(1) priorities ofcorporate decision-makers is the securing ofmobile terminals and applications (a priorityfor 44% and 33% of deciders, respectively).27% of European companies plan to developmobile application management (MAM) and31% to invest in improving the userexperience.

The Econocom offer: Alter 3.4.5.2.Way, Bizmatica, DMS, Econocom Brazil, Gigigo, JTRS, Rayonnance

Econocom has several Satellites that allowit to extend its expertise in corporatemobility not only in Europe, but also inBrazil:

Alter Way (France) responds to mobility•issues on Android technologies: Kotlin, Javaet iOS: Swift 4/5 -Objective-C;

Bizmatica (Italy) provides solutions with•vertical expertise in omnichannel solutions,IOT and network management fortelecommunication companies, Big Dataand analytics, enterprise applications, APImanagement and monetisation;

DMS (France) is a mobile technology•expert specialising in the deployment andmanagement of very large terminal fleets;

Econocom Brazil accelerates the digital•transformation processes of companiesthrough strategic consulting, managedservices and mobile outsourcing;

In Spain, Mexico and Brazil, Gigigo•supports companies in their mobilemarketing strategy by offering customisedmobile application development forconsumers and a platform for generatingand managing promotional marketingcampaigns;

B2B (Apple Solution Expert, GooglePartner, Microsoft Certification, LEGO®Education Partner);

JTRS (United Kingdom) specialises in•technology solutions for education and

Rayonnance (France) provides mobile•solutions for businesses. This Frenchspecialist has been offering businessapplications to companies on PDAs, tabletsand smartphones for more than 16 years.

DIGITAL SIGNAGE 3.4.6.& MULTIMEDIA

A growing market driven by 3.4.6.1.the expansion of retail

According to Technavio’s global digitalsignage market research report, the marketwill record a CAGR (compound annualgrowth rate) of nearly 7% over the 2018-2022period. This dynamism is largely due to thestrong growth in the retail segment, itselfboosted by the increase in the demand forconsumer goods and the rise in householdincome. Other factors such as urban growthand the increase in the demand for qualityproducts also help explain the excellentperformance of the market.

The Econocom offer: Altabox,3.4.6.2.Cineolia, Energy Net

Digital signage solutions can be an excellentlever for new business, for example to enrichomnichannel retail experiences, or to bettercapture user attention and generateadditional advertising revenue.

In order to help its customers put in placethe business models of tomorrow, theEconocom group works in collaborationwith them to create the right digitalsolutions, whatever their business universe.End-to-end support, from the consultingphase up to the creation of an industrialmodel for their innovative projects.

CCS Insight, IT Decision-Maker Survey 2019-2020, 04/2019.(1)



With its Satellites, Econocom is active inseveral geographical areas: Spain, Franceand Germany. The Group aims to offer itscustomers integrated digital solutions,together with financing offers.

Altabox (Spain): leader in Spain in thedevelopment of omnichannel marketingstrategies for retail outlets. Altabox joinedthe Econocom Galaxy in 2018. The companyis specialised in the design and deploymentof dynamic digital signage, sensory andauditory marketing, and traffic and dataanalytics solutions. With this acquisition, theGroup has obtained a complete range ofstate-of-the-art digital point-of-salesolutions, combined with its innovativefinancing and distribution model(subscriptions, payment for use, etc.).

Cineolia (France): Digital specialist forpatient services, Cineolia joined theEconocom Galaxy in 2016. Cineoliaspecialises in the implementation of publicservice delegations (Délégation de ServicesPublics, DSP). Thanks to its innovativeapproach to hospital services concessions(well-being, entertainment, communication,relaxation areas, etc.), the company aims torespond to the needs of all, with a service-and customer-oriented model. It providesvarious digital services to hospital patientsthrough multimedia equipment (connectedtelevisions, telephones, tablets, etc.). Free orpaid entertainment programs and specificcontent are included in this offering, whichalso allows hospitals to direct targetedservices and messages to patients. Cineolia’sambition is to become the leading digitalsolutions provider in France for customersreception in public places (hospitals,museums, etc.). The objective: offering users,thanks to digital, a simple, innovative andquality experience.

Energy Net (Germany): Econocomstrengthened its presence in Germany withthe acquisition of Energy Net in 2017. ThisSatellite, specialised in the B2B distributionand integration of Apple products, allowsEconocom to strengthen its historicpartnership with Apple(1).

Energy Net enables Econocom to developinnovative solutions combining hardware,applications and services, charged as a fee.

CONSULTING3.4.7.

Econocom is strengthening 3.4.7.1.its consulting offer with Helis and Fifty Eight

Helis (France) is a specialised consultingfirm specialising in mission criticalinfrastructure consulting and engineering.With a team of over 60 consultants onassignment, Helis experts assist companiesin their respective fields, in areas asspecialised as IP and network infrastructure,GDPR compliance and Big Data and CSR,providing a bespoke solution to theirtransformation projects.

Fifty Eight (France) is a consultingcompany whose objective is to assist majorcompanies in transforming theirorganisations and their business lines, byusing digital innovation.

Fifty Eight, the Group’s brand undergoingdigital transformation

The objective? Helping businesses and theiremployees to align managerial uses andpractices with business objectives toguarantee a lasting impact bytransformation on performance. Technologysupports this approach to smooth andfacilitate these new ways of operating.

Econocom is Apple’s first B2B partner. The partnership has been in place for 30 years.(1)



From business, organisational or culturaldiagnostic to implementation of newdigital processes and solutions to assistingwith the change over time, Fifty Eightengages with its customers from end toend and helps them to combat “digitalwaste”: increasing costly, unused solutions.

Fifty Eight, through its approach focusedon the needs of business lines and uses,serves as a bridge between the differentcutting-edge technological skill sets withinthe Econocom Galaxy. The Group’sexperience in pay-as-you-go modelscomplements this panoply of 360° playersin digital transformation.

Combination of 3.5.Planet and Satellite know-howThe combination of the know-how of theentities of the Planet (the Group’s threehistorical activities) and the Satellitesmakes it possible to create these“end-to-end” transversal offers (consulting,design, sourcing, construction, financialapproach, security, operation).

These new “one stop shop” offers have noequivalent on the market. They allowcompanies to simplify and manage theentire life cycle of their resources. All of thisthrough the placing of the user at the heartof the digital transformation.

HORIZONTAL TRANSVERSAL 3.5.1.OFFERS

Econocom Mobility Offer3.5.1.1.

Corporate mobility is an essential part ofthe digital transformation of companies.Large or small, regardless of their sector ofactivity, all companies must invest inmobility, but not all have reached the samelevel of maturity.

Having all the expertise needed to respondto this market, Econocom has chosen tostructure them within a transversal offer inFrance. Econocom Mobility is the result ofthe merger of the Econocom group withDMS and Rayonnance, two Satellitesoperating on the French mobility market.

The offer covers the needs of companiesin the field of digital mobility, and meetsthe expectations of CIOs as well as BusinessDepartments and employees. Through theGroup’s Technology Management &Financing (TMF) activities, EconocomMobility adapts to consumer uses with its“Mobility as a service” offer.

To simplify the management of themobility program, Econocom hasdeveloped a platform bringing togetherprocesses, users and data (interconnectionwith the customer ecosystem).

Terminals & Connectivity:•

the distribution of consumer-grade or▶rugged terminals, traceability solutionsand mobile payments;

services to ensure complete lifecycle▶management (fleet deployment,maintenance and recycling, fleetand subscription management,optimisation of telecommunicationsexpenditures);

a data connectivity offer to guarantee▶the best market all over Europe;

Security:•

strategy consulting and to be adopted▶and integration and managementservices in EMM solutions and mobilethreat detection;

partnerships with market leaders and▶an internally developed solution(Harmonie);

an innovative solution to simplify the▶life of users during an EMM migration(Wave);



Applications:•

tailor-made development of business▶applications with real expertise inretail, field forces, transport-logistics,construction and health;

packaged applications to meet▶standard needs and a developmentand integration platform to simplifymobile application creation andmanagement (App Factory);

Employee Experience: services•associating human assistance (specialisedhelpdesks, local support, on-site training)and selfcare (mobile support application,connected drop-off points) to ensureautonomy and user satisfaction.

Econocloud offer3.5.1.2.

Econocloud is another vision of cloud andIT outsourcing.

Launched in 2018 to allow companies tomanage all their cloud resources via asingle console, Econocloud is:

an ultra-secure sovereign cloud service•hosted in France: this service allows theoutsourcing of IT production in anultra-secure zone and in compliance withthe totality of French and European laws, inorder to protect the intellectual andindustrial property of companies withsensitive or confidential data;

a next generation Cloud Management•Platform, which allows hybridisation andmulticloud solutions: it allows theadministration and centralised managementof all IT resources through a single unifiedportal, integrating cost management,compliance and optimisation. Consolidatedreporting of all resources allows monitoringand financial optimisation.

MarS (Master all Resources) 3.5.1.3.offer

Users are the top players. They vote withtheir mouse clicks, testing, comparing andevaluating in a few seconds the relevanceof what is proposed to them. They adoptthe resources proposed by a company orchoose to use others. Regardless of thestrategy and the means employed, it is theywho decide whether a solution isappropriate or not.

This result in significant additional costs forcompanies and difficulties in deployingprojects as planned. The lack of capacity tomeasure actual uses, silo data managementand difficulties in calculating TCO (TotalCost of Ownership) and ROI are also factorsthat explain the additional costs.

Today’s decision-makers are looking for asimple solution to understand the real usesof employees from the data availablethroughout the life of digital resources(assets, applications and connected devices)and to have the necessary indicators formanaging resources. This is the ambition ofthe MarS solution (see details in box).

MarS: understanding real uses andsucceeding in the transformation

On one hand, licences that are expensiveand for which 25%(1) of the cost is consideredunused by the employee. On the other,there are poorly controlled IS investmentswhose ROI is not known(2). This means thatthe digital transformation could be muchmore efficient with precise indicators onuses! Based on this observation, Econocomhas created the MarS (Master all Resources)offer, a cockpit for decision-makers,providing a set of smart indicators takenfrom workstation data.

Source: https://iaitam.org/wp-content/uploads/2015/12/The-Real-Cost-of-Unused-Software.pdf(1)85% of companies do not know how to calculate the ROI of their digital initiatives and the IS projects (2)have an average overhead of 45% (studies undertaken by Econocom, McKinsey, 1E or Atos).



MarS can produce indicators to improvethe performance of digital transformationsin three specific areas:

financial performance: how to spend less•thanks, for example, to an anti-digitalwaste algorithm to identify all assets andapplications not used by the company;

operational performance: how to increase•user satisfaction with, for example, asatisfaction indicator that makes it possibleto capture user satisfaction;

technological performance: how to•improve uses from typical employeeprofiles defined through their digital uses.

VERTICAL TRANSVERSAL 3.5.2.OFFER

Econocom Retail3.5.2.1.

With the proliferation of technologicalinnovations, “smart phygital” is becomingthe new norm. While many thought thate-commerce would render physical storesobsolete, 360 degree retail is emergingbetween the on- and off-line worlds.

Econocom Retail’s ambition? To helpretailers meet new challenges in theirindustry by offering their customers anexperiential, connected and omnichannelretail solution to improve the customerexperience. With solutions supporting theentire customer journey, from digitalsolutions for attracting customers to thestore, and then ensuring their loyalty afterthey leave, including innovative solutionswithin the store itself, Econocom Retail aimsto bring the future of customer experienceto end-customers today.

Econocom Retail is:

end-to-end connected solutions to•provide customers with a unique,innovative and consistent customerexperience;

custom-designed software and solutions;•

360 degree collaboration: conception,•support and financing;

a showroom and a labcenter: an•invitation to live the new retail experiencewith Econocom Retail.


02 group overviewfinancial position and results

Financial position and results4.Highlights of the past 4.1.

three years2019 was notable for:

revenue of €2,927 million stable over its•continued activities at constant standards,identical to 2018. On an organic basis, itwas down slightly by 0.8%. Restated for thedrop in revenue of TMF in Italy, growthamounted to 4.5% (of which 3.7% organicgrowth);

in the process of refocusing its activities,•the Group placed 13 companies/activitiesin the IFRS 5 scope of application(discontinued activities);

profit from continuing operations(1) which•stands at €126 million for continuingactivities;

the companies Jade and Rayonnance•were sold (however, the Group hasretained 10% of Rayonnance);

the Group launched a plan to reduce•direct and indirect expenses by€96.5 million gross spread out over threeyears, resulting in savings of €30 million in2019;

net accounting debt remained stable•compared with 2018. On the one hand, thisreflects sound operating cash flowgeneration, the cash inflows received fromthe partial sale of Rayonnance inDecember, as well as the decline workingcapital requirements for EDFL and, on theother hand, the cash outflows in the yearrelated to the acquisition of non-controllinginterests in Satellites, to the redemption ofthe issue premium and to treasury sharebuybacks;

as at December 2019, treasury shares•totalled 9.56% of the share capital.

2018 was notable for:

revenue of €2,999 million, reflecting•organic growth of 2.7%. This revenuefigure reflects the first application ofIFRS 15;

profit from continuing operations(1) stands•at €110.9 million;

in March 2018, the issue of an OCEANE•bond maturing in 2023 for a nominalamount of €200 million. This convertiblebond aims to support the Group’sinvestments in its new strategic plan;

the continuation of Econocom’s•investment strategy, initiated in 2014,through the acquisition of majorityshareholdings in new subsidiaries (seebelow) while multiplying innovativeinitiatives on the Planet. These transactionswere intended to strengthen the Group’sknow-how in the most buoyant marketsegments and to roll out its original modelin the leading European countries;

the return in October of Jean-Louis•Bouchard, founder of the Group andChairman of the Board of Directors, to theposition of CEO;

the continuation of the Group’s cash•management efforts, which significantlyreduced the Group’s working capitalrequirements and lowered net book debt.

2017 was notable for:

the achievement of the objectives of the•five-year Mutation strategic plan launchedin 2013, with a two-fold increase in revenue(before the application of IFRS 15) andprofit from continuing operations to€3 billion(1) and €154.4 million respectively;

Before amortisation of intangible assets from acquisitions.(1)


02group overviewfinancial position and results

the improvement in these indicators• relation to third parties, combined with theconfirms the pertinence of the Group’s agility and innovation of the Satellites, helpmodel and investments, which bring the Group conquer new markets;together within its Galaxy a Planetcomprising wholly owned entitiesalongside Satellites, small- andmedium-sized companies that are highlyeffective in their area of expertise and inwhich founding entrepreneurs retainstakes. The stability and size of the Planet,which bolster the Group’s credibility in

April 2017 saw the early conversion of the•Company’s January 2014 ORNANE bondsdue in 2019, boosting equity by€183 million;

the two-for-one split of Econocom group•shares.

Consolidated data for the year: comparison 4.2.between 2018, 2017 and 2016

KEY FIGURES4.2.1.

in € millions 2019 2018 restated* 2017

Revenue from continuing operations

2,926.6 2,999.0 2,634.3

Profit (loss) from continuing ordinary operations (before amortisation of intangible assets from acquisitions)

126.2 110.9 154.4

Profit (loss) from continuing operations

124.2 106.7 150.2

Operating profit 99.4 86.8 131.1

Shareholders’ equity (including non-controlling interests)

483.9 491.3 480.0

Net debt 252.2 251.7 278.6In accordance with IFRS 5, 2018 income and expenses of activities discontinued in 2019 are reclassified to the*

income statements of 2018 under "Profit (loss) of discontinued operations". However, in accordance with theprovisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is not restated for the impact of thisregulation on leases. In addition, the 2018 consolidated income statement is impacted by the recognitionhenceforth on the principal basis (within the meaning of IFRS 15) of direct deliveries.



REVENUE4.2.2.

in € million 2019 2018 restated* 2017

Technology Management & Financing Services

1,124 1,321 1,379

Digital Services & Solutions 1,802 1,678 1,255

Total revenue 2,927 2,999 2,634In accordance with IFRS 5, 2018 income and expenses of activities discontinued in 2019 are reclassified to the*


For continuing operations, Econocomreported for financial year 2019 annualconsolidated revenue of €2,926 millionequal to €2,927 million at constantstandards earned in 2018. Restated for thefall in revenue by TMF in Italy, growthreached 4.5% (3.7% organically).

This performance was driven by the goodperformance of Digital Services & Solutions,which contributed €1,802.4 million toconsolidated 2019 revenue, with organicgrowth up 6.2%.

Technology Management & Financing

At 31 December 2019, TechnologyManagement & Financing recordedrevenue of €1,124 million compared with€1,321 million one year earlier, which is adecrease of 10%. This decline is related tothe lesser contribution by the subsidiaryTMF in Italy for around €134 million.Excluding this effect, growth would havebeen 0.6% in 2019.

Revenue for this segment increased by 1.6%in 2018, mainly owing to organic growth,recording an increase of 9.5% on 2017.

Digital Services & Solutions

Digital Services and Solutions postedrevenue in 2019 of €1,802 million comparedwith €1,678 million in 2018, or an increase of7.4% (6.2% organic growth). This activitycontinued to grow with major plans for ITequipment for high schools and large localauthorities in France. In 2017, the Servicesbusiness posted revenue of €902 million,an increase of 12.5% thanks to theincreasing number of major outsourcingcontracts. Products & Solutions reportedrevenue of €353 million; much of thisgrowth was achieved in France, Belgiumand the Netherlands following theacquisition of the BIS group at thebeginning of the year.

Products & Solutions posted revenue of€448 million in 2018, reflecting a stronggrowth rate of 26.7%, with organic growthof 9.4%.


02group overviewfinancial position and results

PROFIT (LOSS) FROM CONTINUING OPERATIONS4.2.3.

in € millions 2019 2018 restated* 2017

Technology Management & Financing Services

43.9 52.3 92.4

Digital Services & Solutions 82.3 58.6 62.0

Total recurring operating profit 126.2 110.9 154.4

In accordance with IFRS 5, 2018 income and expenses of activities discontinued in 2019 are reclassified to the*


The Group’s profit from continuingoperations before amortisation of intangibleassets from acquisitions is €126.2 million, i.e.4.3% of revenue. In the second half theGroup amplified its cost reduction plan,resulting in gross savings of around€30 million offsetting the decline in thecontribution by the Italian subsidiary.

In 2018 the Group’s profit from continuingoperations stood at €110.9 million,accounting for 3.8% of revenue, affected bythe decrease in operating profit fromTechnology Management & Financing.

In 2017, the Group's profit from continuingoperations increased by 10.1% to€154.4 million. Growth was driven by theTechnology Management & Financing andthe Products and Solutions business lines.For the Group as a whole, profitability was5.2%.

OPERATING PROFIT4.2.4.

of 14.5%. Non-recurring expenses stood at€24.8 million, up €94.9 million over 2018under the effect of reorganisation measuresand consequences of fraud, of which theGroup was a victim in Italy.

The Group’s operating profit was€99.4 million in 2019, compared with€86.8 million in the previous year, a decrease

In 2017 and 2018, non-recurring expensesamounted to €19.9 million in 2018 followingadjustments to the accounting methodsused for changes in the fair value of putoptions in debt instruments now recorded asequity.

FINANCIAL POSITION4.2.5.

The Group boasted a sound financialposition at 31 December 2019, with net cashat bank of €284 million and net debt undercontrol at €252.2 million, less than 1.4x its2019 EBITDA.

At 31 December 2018, net debt stood at€251,7 million, less than 1,6x Group EBITDA in2018.

At 31 December 2017, net debt stood at€278.6 million, less than 1.5x Group EBITDAin 2017.



Equity restrictions4.3.In May 2015, the Group issued a EuroPrivate Placement (Euro PP) bond and aSchuldschein loan in November 2016.

interest rate until the ratio is brought backwithin the relevant bounds.

The Group is subject to one single covenantin relation to these bond issues. It iscalculated as of 31 December of each year,and corresponds to the ratio of net debt toproforma EBITDA. And it may not exceed3x over two consecutive years. A breachwould not result in early redemption, but itwould force the Group to pay a higher

Other lines of credit do not containcovenants in respect of maximum debt,financial ratios or credit ratings that, ifbreached, would trigger immediaterepayment.

Econocom is not subject to any legal oreconomic restrictions liable to limit orsignificantly restrict cash flows within theGroup in the foreseeable future.


02group overviewcorporate governance

Corporate Governance5.Board of Directors 5.1.

and Advisory CommitteesThe composition and functioning of theBoard of Directors and the Board’sCommittees are governed by:

articles 7:85 et seq. of the new Belgian•Companies Code;

articles 14 et seq. of the Bylaws;•

the internal rules of the respective•Committees, available on the Econocomwebsite (www.econocom.com), i.e.:

the internal rule of the Board of(i)Directors’ meeting of 19 May 2016 (the“Board of Directors’ internal rule”);

the internal rule of the Executive(ii)Committee (formally ExecutiveCommittee) of 7 September 2016 (the“Executive Committee’s internal rule”);

the internal rule of the Audit(iii)Committee of 22 November 2012 (the“Audit Committee’s internal rule”); and

the internal rule of the(iv)Compensation Committee of 31 August2011 (the “Compensation Committee’sinternal rule”).

For more details on corporate governance,please refer to section 5, chapter 5 of thisreport, which contains the ManagementReport of the Board of Directors on thefinancial statements for the year ended31 December 2018.

BOARD OF DIRECTORS5.1.1.

Composition of the Board 5.1.1.1.of Directors

Appointment (article 14 of 5.1.1.1.1.the Bylaws and article 4 of the Board of Directors’ internal rules)

The Company is governed by a Boardcomprising at least three members,whether or not shareholders or legalpersons. Members are appointed to theBoard for a maximum term of four years bythe General Shareholders’ Meeting, whichmay remove them at any time. They maybe re-elected. The term of office ofoutgoing Directors ends immediately afterthe General Meeting that decides onre-election.

The composition of the Board ensures aneven balance between the Chief ExecutiveOfficers, the non-executive Directors andthe independent non-executive Directors. Ifthe number of Directors so permits, at leastthree Directors shall be independent withinthe meaning of Appendix A of the BelgianCorporate Governance Code. The aim isthat at least half of Board members shouldbe non-executive Directors, and that atleast one-third of Board members shouldbe of a different gender than the othermembers.

Directors are appointed by the GeneralShareholders’ Meeting from the candidatesput forward by the Board.

Directors undertake to act in Econocom’sinterest and to maintain independence ofjudgement, decision-making and action inall circumstances. They participate in thework of the Board in a wholly impartialmanner. Even if Directors know Econocomgroup’s business sector well, they shouldcontinue to build on their knowledge andexpand their expertise.


02 group overviewcorporate governance

The Board regularly reviews itscomposition, functioning and interactionwith the Chief Executive Officer(s) and withthe Executive Committee.

Vacancy (article 15 of the Bylaws)5.1.1.1.2.

If a seat on the Board becomes vacant, theremaining Directors are entitled to fill ittemporarily. In this case, the first AnnualGeneral Meeting after the seat becomesvacant appoints a Director to fill the vacancyon a long-term basis. The Directornominated in the conditions describedabove is appointed for the remaining termof office of the Director he/she is replacing.

Chair, Vice-Chair and Secretariat 5.1.1.1.3.(article 16 of the Bylaws and articles 5 and 6 of the Board of Directors’ internal rules)

The Board of Directors elects a Chairmanand Vice-Chairman from among itsmembers.

The Chairman of the Board is responsiblefor:

Ensure the management by the Board,1and in particular see to it that the Board iswell organised, operates efficiently andperforms its obligations andresponsibilities. This involves:

preparing, presiding and managing▶the sessions of the Board and makingcertain that in the meetings, sufficienttime is reserved for a serious in-depthdiscussion of the relevant issues;

drawing up the agenda for the▶meetings of the Board, in liaison withthe Chief Executive Officer(s) and,where appropriate, the ExecutiveCommittee;

ensuring that the Board receives the▶appropriate information and that thedocuments supporting proposals fordecisions are relevant and readilyavailable within a reasonable timeprior to Board meetings;

Ensure the quality and continuity of2.the Board’s work by initiating andmanaging procedures concerning:

the assessment of the size,▶composition and performance of theBoard of Directors or the ChiefExecutives, his Committees and theExecutive Committee to ensure theefficiency of the decision-makingprocess;

appointing or re-electing members of▶the Board, the Chief Executive Officers,members of the Board’s Committeesand the Executive Committee;

“Liaising” between the Board and the3.Executive Committee. This involves:

meeting regularly with the Chief▶Executive Officer(s) and othermembers of the Executive Committee;

seeing to it that relations between the▶Board and the Executive Committeeare of a professional and constructivenature and that the ExecutiveCommittee provides the Board withthe information necessary to play itsrole in terms of evaluation,decision-making, supervision andcontrol;

if it deems it in the interest of the▶Company, the Board may turn overthe position of Chairman to anyDirector who performs executiveduties within Econocom;

in the absence of the Chairman the▶Vice-Chairman replaces him. Shouldboth the Chairman and theVice-Chairman be prevented fromattending a Board meeting, theDirectors present elect a Chairman forthe meeting in question.

The Board of Directors may appoint aCompany Secretary who reports on how theprocedures, rules and regulationsapplicable to the Board are implementedand respected. Directors may consult theCompany Secretary at their own initiative.



Compensation (article 14 of the 5.1.1.1.4.Bylaws and article 10 of the Board of Directors’ internal rules)

Directors may or may not collectcompensation for the performance of theirduties. Any fixed or variable compensationmay be set by the Annual General Meetingacting on a recommendation from theBoard of Directors assisted by theCompensation Committee.

Compensation is set for each Director or onan aggregate basis for the Board as a whole,in which case the Board shall decide how toallocate the compensation according tocriteria it defines.

Compensation due to non-executiveDirectors is determined based on a realisticassessment of their responsibilities, theassociated risks and market practices.

Powers of the Board of 5.1.1.2.Directors (article 20 of the Bylaws and article 2 of the Board of Directors’ internal rules)

The Board of Directors is vested with thepower to undertake all actions necessary oruseful for the Company to fulfil itscorporate purpose, except for those actionsset aside Bylaw for the Annual GeneralMeeting, and without prejudice to thepowers it may delegate.

The Board represents the Company in itsdealings with third parties and in legalproceedings, either as plaintiff or defendant.

It has the following duties andresponsibilities, which it performs with thesupport of the Executive Committee andthe Committees it has established:

Committee and, more broadly, ensure theestablishment of a clear and effectivemanagement structure;

appoint, monitor and evaluate the Chief•Executive Officer(s) and ManagingDirectors, members of the Committeesestablished in accordance with theprovisions of the new Belgian CompaniesCode, as well as members of the Executive

approve the strategic plans on the•suggestion by the Chairman of the Boardafter study with the Executive Committee;

assess Econocom’s functioning in relation•to its strategic and budgetary targets,based notably on a quarterly review offinancial results and any other reportsmade to the Board;

approve any acquisitions, investments or•internal reorganisation consideredstrategic by the Chairman of the Board orthe Executive Committee;

take all steps necessary to ensure the•integrity of the financial statements andother important information that must bedisclosed to investors, and theirpublication within the prescribedtimeframe;

approve an internal control and risk•management framework and oversee thework of the Statutory Auditor and InternalAudit;

approve any other matters that the•Chairman, Chief Executive Officer orExecutive Committee member believesshould be submitted for approval by theBoard due to its strategic significance(even in relation to matters delegated bythe Board to the Executive Committee, theChief Executive Officers, the ManagingDirectors or any third party);

take all decisions on matters set aside for•it by law and the Bylaws, including anydecision to be submitted to the AnnualGeneral Meeting;

assess its own functioning and interaction•with the Chief Executive Officer(s), theManaging Directors and the ExecutiveCommittee.



Functioning of the Board 5.1.1.3.of Directors

Meetings (article 17 of the Bylaws 5.1.1.3.1.and article 7.1 of the Board of Directors’ internal rules)

The Board of Directors meets at least fourtimes a year. Board meetings are convenedand chaired by the Chairman, or, if theChairman is prevented from attending aparticular meeting, by the Vice-Chairman,whenever it is deemed to be in theCompany’s interest or each time aminimum of two Directors so request.

The Chairman prepares the agenda foreach Board meeting together with theChief Executive Officer(s) or the ExecutiveCommittee.

Board meetings are held at the locationindicated in the convening notice.

Members of the Board are convened atleast five working days before the date ofthe meeting, unless a shorter timeframe isin the Company’s interests or the Directorsdecide upon one.

Important information needed to allow theDirectors to understand the matters to bediscussed at the meeting are sent to eachDirector as soon as possible before the dateof the Board meeting.

A Director unable to attend a Boardmeeting may be represented by anotherDirector provided a proxy request issubmitted in writing.

The Board may invite any persons whosepresence it deems useful to attend itsmeetings.

Quorum and deliberations 5.1.1.3.2.(article 18 of the Bylaws and article 7.3 of the Board of Directors’ internal rules)

The Board of Directors may only validlydebate and take decisions if at least half ofits members are present or represented.

the Chairman or, in his absence, theVice-Chairman or, in his absence, theDirector replacing him, has the castingvote.

Decisions of the Board are adopted on thebasis of a majority of votes cast; abstentionsare not counted. In the event of a tied vote,

In exceptional circumstances, whenurgency and the best interests of theCompany so dictate, decisions may beadopted pursuant to the unanimousconsent of the Directors, expressed inwriting. However, this procedure cannot beused for the approval of the annualfinancial statements or the utilisation of theauthorised capital.

Proxies (article 18 of the Bylaws 5.1.1.3.3.and article 7.1 of the Board of Directors’ internal rules)

All Directors may ask one of theircolleagues to represent them at a givenmeeting of the Board of Directors and voteon their behalf. This request may be madein writing, by email, by fax, or by any othermeans used to grant unequivocal specialrepresentative powers. In this case, theDirector (proxy giver) represented isdeemed to be present.

A Director may represent one or moreother members of the Board.

Directors may also express opinions andvote in writing, by email or by fax, but onlyif half of the Board members attend themeeting in person.

Minutes (article 19 of the Bylaws 5.1.1.3.4.and article 7.5 of the Board of Directors’ internal rules)

Deliberations of the Board of Directors arerecorded in the minutes of the meetingsigned by at least the majority of themembers present.

These minutes are recorded in a specialregister together with any delegations ofauthority granted.

Copies or extracts required for legal orother purposes are signed by theChairman, by a Chief Executive Officer, bytwo Directors or by a Managing Director.



Information provided to the Board 5.1.1.3.5.(article 9 of the Board of Directors’ internal rules)

The Directors have access to all of theinformation needed to exercise their dutiesin a due and proper manner. Non-executiveDirectors may raise issues with members ofthe Executive Committee, after havingconsulted the Chairman of the Board or aChief Executive Officer and made sure thatthis will not jeopardise the proper conductof business.

Directors may not use the informationreceived in their capacity as Director forpurposes other than the exercise of theiroffice. They are required to keep anyinformation they receive in their capacity asDirector confidential.

Day-to-day management – 5.1.1.4.delegation (article 21 of the Bylaws and article 3 of the Board of Directors’ internal rules)

The Board of Directors may delegate thepower to manage the Company’sday-to-day affairs or to represent theCompany with regard to its day-to-daymanagement to one or more Directors whoare also Chief Executive Officers and/or toone or more executives who are alsoManaging Directors, regardless of whetheror not they sit on the Board.

Their roles and responsibilities are set out inthe agreement governing theirappointment. Nevertheless, the limitsplaced on their representative powers forthe purposes of day-to-day managementshall not be binding on third parties, even ifthey are published.

exercise of their powers, subject to theconsent of the Board of Directors or theperson responsible for day-to-daymanagement (as appropriate).

The Board of Directors and thoseresponsible for day-to-day management,within the limits of the powers of day-to-daymanagement, may grant special andprecise powers to one or more persons oftheir choice, who need not be shareholdersor Directors. Holders of these special powersmay substitute one or more persons in the

In the event of a special delegation ofpowers, the deed of appointment definesthe relevant powers and the relatedcompensation.

Liability of the Board of 5.1.1.5.Directors (article 25 of the Bylaws)

The Directors and the Statutory Auditor(s) arenot personally liable for undertakings madeby the Company.

Pursuant to common law and the provisionsof the new Belgian Companies Code, theymay be held liable for the performance oftheir duties and any faults committed intheir management.

Representation (article 22 of 5.1.1.6.the Bylaws)

The Board of Directors represents theCompany as a collegial body in its dealingswith third parties and in legal proceedings.

Notwithstanding the Board’s generalpowers of representation as a collegial body,the Company is legitimately represented inany legal proceedings and in its dealingswith third parties, including with publicofficers (and mortgage registrars):

either by the Chairman of the Board of•Directors, acting alone; or

by two Directors, acting in concert; or•

by a Chief Executive Officer, acting alone;•or

by a Managing Director, acting alone.•

The aforementioned persons are notrequired to provide any justification of aprior decision of the Board of Directors.

The Company is also legitimatelyrepresented by special proxies acting withinthe scope of their mandate.



COMMITTEES OF THE BOARD 5.1.2.OF DIRECTORS (ARTICLE 21 OF THE BYLAWS)

The Board of Directors may set up anycommittee it deems useful, permanent ortemporary, in an advisory or technicalcapacity. The internal rules of thesecommittees are set by the Board ofDirectors.

Each Committee is governed by its owninternal rules, which define its composition,role, function and responsibilities as well asits functioning. These internal rules areadopted by the Board of Directors.

The Board of Directors shall establish anAudit Committee within the meaning ofarticle 7:99 bis of the new BelgianCompanies Code, as well as aCompensation Committee within themeaning of article 7:100 of the new BelgianCompanies Code. The composition of theseCommittees, their tasks and internal rulesare established by the Board of Directors,pursuant to the provisions of the BelgianCompanies Code.

The Board of Directors may establishspecialised Committees tasked withexamining and advising on specific issues.The composition and role of thesecommittees are governed by the Board ofDirectors in accordance with applicablelaw.

Executive Committee 5.1.2.1.(article 21 of the Bylaws, article 3 of the Board of Directors’ internal rules and the Executive Committee’s internal rules)

General information5.1.2.1.1.

Pursuant to articles 15:18 and 7:121 of the newBelgian Companies Code and article 21 ofEconocom’s Bylaws, the Board mayestablish an Executive Committee,consisting of several persons, Directors ornot, and delegate to it the operationalmanagement of the Company, as well asspecial powers other than those relating tooperational management, without prejudiceto the day-to-day management powersconferred to the Chief Executive Officers.

However, the Board of Directors retainsexclusive powers for overall policy and foracts reserved for the Board pursuant to thelaw, the Bylaws or the Board’s internal rules.The Board may also address any questionrelating to operational management, if itconsiders it appropriate. In accordance withthe decisions of the Board, the Committeemay, in turn, delegate any of itsresponsibilities to an Executive Committee(ExCom).

Composition of the Executive 5.1.2.1.2.Committee

The members of the Executive Committeeare appointed by the Board of Directors.The Executive Committee has at least threemembers, who may or may not be Directorsor Econocom group employees. The Boardof Directors shall in principle ensure thateach Chief Executive Officer and eachManaging Director in charge of Econocom’sday-to-day management is a member ofthe Executive Committee.

The members of the Executive Committeemay, in their capacity as Council members,be removed by the Board of Directors at anytime (without prejudice to employment ormanagement contracts binding them toEconocom group).

The members of the Executive Committeeare appointed for a maximum term of sixyears. They may be re-elected.

The Executive Committee is chaired by aChief Executive Officer appointed by theBoard.

Role of the Executive Committee5.1.2.1.3.

The Executive Committee’s responsibilitiesinclude, but are not limited to:

taking all steps necessary to implement•the decisions or recommendations of theBoard;

proposing strategic guidelines to be set by•the Board, and framing budgets within thestrategic guidelines laid down by theBoard;

managing the Group’s operating entities•(in accordance with the powers of the



bodies of these entities), and supervisingtheir financial and operating performance;

entering into all agreements, making and•approving all pricing proposals, placingand accepting all orders to buy, sell or leaseany equipment and other capital goodsand services;

leasing and renting out, even for long•periods, any properties, equipment orintangible assets, and entering into anylease and rental agreements concerningsuch assets;

concluding financing, with or without the•provision of collateral, except for thefollowing transactions, which fall within thescope of the powers of the Board: anycapital market transaction (other thancommercial paper), any financing that hasthe effect of causing consolidated net debtto exceed consolidated equity or torepresent more than 2x consolidatedEBITDA;

performing any external growth•transaction, investment or disinvestment,with the exception of strategic transactions(including any transaction whose value orconsideration exceeds €4 million), whichfall within the scope of the powers of theBoard of Directors;

acting in dealings with the national•government or EU, regional, state andmunicipal authorities, the Crossroads Bankfor Enterprises (Banque-Carrefour desEntreprises), the tax authorities, the postalservice, customs authorities,telecommunications companies and anyother public departments or authorities;

managing all legal or arbitration•proceedings, as plaintiff or defendant,negotiating all settlements, taking all stepsnecessary in this respect, and obtainingand enforcing all rulings;

representing Econocom in its dealings•with trade union and employerrepresentative bodies;

drafting and signing all documents•necessary for implementing the powersdelegated to it.

Without prejudice to the powers set asidefor the Board or the Board’s Committees,such as the Audit Committee, the ExecutiveCommittee is also responsible for:

implementing internal controls;•

preparing full, timely, reliable and accurate•financial statements in accordance withaccounting standards and withEconocom’s overall policies as defined bythe Board;

presenting the Board with an impartial•and comprehensible assessment of theCompany’s financial position and, moregenerally, promptly providing the Boardwith all of the information it needs toperform its duties;

the Committee may in turn delegate all•powers assigned by the Board of Directors,both to Econocom employees and thirdparties.

The powers conferred on the Executive•Committee shall in no event include thepowers reserved by law, the Bylaws orinternal rules for the Board of Directors. It isalso the responsibility of the ExecutiveCommittee to:

submit to the Board any question▶relating to a strategic transactionbearing on Econocom or the Group,without prejudice to the Board’spowers to examine any issues relatingto operational management;



respect the day-to-day management▶powers delegated by the Board ofDirectors to one or more ChiefExecutive Officers and/or ManagingDirectors.

The Executive Committee has no powers ofrepresentation in respect of third parties;such powers are set out in the Bylaws andthe Board’s internal rules.

Functioning of the Executive 5.1.2.1.4.Committee

With the exception of the matters describedbelow, the rules set out in the Bylawsapplicable to Board meetings, deliberationsand minutes also apply to the ExecutiveCommittee.

The Executive Committee meets at theinitiative of its Chairman, or when requestedby two Executive Committee members. TheExecutive Committee meets at least tentimes a year. Meetings are held at thelocation indicated in the convening notice.

The agenda for the meetings is set by theChairman. However, members are entitled topropose the addition to the agenda of anyitem they deem necessary. The ExecutiveCommittee’s discussions are based on filescontaining all information needed fordecisions to be made, distributed to eachmember. The Executive Committee mayinvite any persons whose presence it deemsuseful to attend its meetings.

The Executive Committee acts as a collegialbody; its decision-making is based on aconsensus-building process. Whereappropriate, the Chairman of the ExecutiveCommittee may put matters discussed tothe vote, at his own initiative or further tothe request of two other members. Mattersare then decided by a majority vote of allmembers present. When there is nomajority, the Chairman holds the castingvote.

scope of its responsibility. The Chairman ofthe Committee or any other Committeemember appointed for the purpose issues aquarterly report in this regard for theChairman of the Board of Directors; thisreport includes internal reporting offinancial results for the quarter.

The Executive Committee reports to theBoard of Directors on its management andon any significant issues falling within the

The Executive Committee takes all steps itdeems necessary to allow the Board to fulfilits duty of oversight as required by law, theBylaws and its internal rules.

At 31 December 2019, the ExecutiveCommittee consisted of Jean-Louis Bouchard,Éric Bazile, Angel Benguigui, Laurent Caparros,Bruno Grossi, Philippe Goullioud, Eric Lucas,Laurent Roudil and Chantal De Vrieze.

Audit Committee (article 21 5.1.2.2.of the Bylaws and the Audit Committee’s internal rules)


The Board of Directors has set up an AuditCommittee in accordance with article 21 ofEconocom’s Bylaws and with article 7:99 ofthe new Belgian Companies Code.

The role of the Audit Committee is to assistthe Board of Directors in performing itsduties of oversight of Econocom’s businessin the broadest sense of the term. Morespecifically, the Audit Committee assessesfinancial information and monitors internalcontrol, risk management and internal andexternal audit processes. It issues opinions.

Composition of the Audit 5.1.2.2.2.Committee

The Audit Committee comprises at least twonon-executive Directors. If additionalDirectors are appointed to the AuditCommittee, the Committee must alwaysinclude at least one independent Directorwith accounting and audit expertise.

The members of the Audit Committee areappointed by the Board of Directors. Thethree-year term of office is renewable.



The Chairman of the Audit Committee isappointed by the Board of Directors. TheChairman of the Board of Directors cannotchair the Audit Committee.

The term of office of a member of the AuditCommittee ends at the same time as histerm of office as Director.

At 31 December 2019, the Audit Committeeconsisted of Rafi Kouyoumdjian, GaspardDürrleman and Marie-Christine Levet. TheCommittee is chaired byGaspard Dürrleman.

Role of the Audit Committee5.1.2.2.3.

The Audit Committee is responsible for thetasks described below:

Financial reporting1

monitoring the process of preparing▶financial information and ensuring itsreliability, i.e., the accuracy,completeness and consistency of thefinancial statements;

discussing any material financial▶reporting issues with the members ofthe Executive Committee and with theStatutory Auditor. In particular, theExecutive Committee informs theAudit Committee of the methods usedto account for material and unusualtransactions when several possibleapproaches exist, and of the existenceand justification of activities carried outthrough special purpose vehicles;

Internal control – risk management2

understanding the risk management▶and control systems established byEconocom’s management, assessingwhether the systems are appropriateand, where applicable, makingrecommendations to mitigate anymaterial risks;

reviewing decisions taken at suchtimes and, where appropriate, makingits own recommendations;

reviewing the results of any▶investigations undertaken within theCompany in response to alleged fraudor errors, or for any other reason:

enquiring about the systems in place▶within the Company and itssubsidiaries to ensure compliance withthe main legal and regulatoryrequirements applicable to them;

Internal Audit3.

reviewing and making recommendations▶on the proposals by the ExecutiveCommittee relating to the appointmentor replacement of the head of InternalAudit as well as the annual budgetallocated for its operation;

taking note of the work programme of▶the head of Internal Audit and hisreports;

reviewing the effectiveness of the▶Internal Audit function, chiefly byanalysing how management appliesthe findings and recommendations ofInternal Audit;

External Audit4.

formulating recommendations to the▶Board of Directors as to theappointment of the Company’sStatutory Auditor of the renewal of histerm of office, the amount of hiscompensation and any mention of hismission;

ensuring Statutory Auditor▶independence, chiefly in light of theprovisions set forth in the new BelgianCompanies Code and the Royal Decreeof 4 April 2003;

identifying the Statutory Auditor’s▶work programme and reports;

periodically reviewing the▶effectiveness of the External Auditprocess and analysing how theExecutive Committee follows up onany recommendations made by theStatutory Auditor;



defining, together with the Company’s▶Statutory Auditor, the nature, scopeand cost of the Statutory Auditor’sinvolvement in any work performedthat is unrelated to the statutory auditengagement;

Other5.

formulating recommendations to the▶Board of Directors concerningmatters falling within the scope ofresponsibility of the Audit Committee;

fulfilling any other roles assigned by▶the Board of Directors.

Functioning of the Audit 5.1.2.2.4.Committee

The Audit Committee meets as often asnecessary and at least four times a year. Atleast two meetings a year deal chiefly withthe financial statements.

The Chairman of the Audit Committeedetermines the agenda for each meeting.An Executive Committee or AuditCommittee member may ask the Chairmanof the Audit Committee to place any itemhe or she considers appropriate on theagenda.

The Audit Committee takes care to preservefree and open communication with theExecutive Committee.

The Audit Committee may invite theStatutory Auditor, the head of Internal Auditand any other member of the ExecutiveCommittee or Econocom employees toattend all or part of its meetings. The headof Internal Audit and the Statutory Auditormust each attend at least two AuditCommittee meetings per year.

Before meetings of the Audit Committee, itsChairman is responsible for ensuring thatmembers receive accurate, complete andclear information in connection with theitems on the agenda. The ExecutiveCommittee is required to provide allnecessary information, and the AuditCommittee may request any clarification itdeems necessary.

Except in emergencies identified by theChairman of the Audit Committee, AuditCommittee meetings are convened at leastfive working days before they are due totake place. A shorter timeframe may applyprovided that all members agree.

The Audit Committee can deliberate if atleast two of its members are in attendanceor legitimately represented. Decisions aremade by a majority of votes cast.

The Audit Committee annually assesses itsfunctioning and effectiveness. It meets forthis purpose with the head of Internal Auditand the Statutory Auditor for an exchange ofviews on the audit process and the AuditCommittee’s internal rules. It reports thisassessment to the Board of Directors andmakes, if necessary, proposals formodifications.

Compensation Committee 5.1.2.3.(article 21 of the Bylaws and the Compensation Committee’s internal rules)


The Board of Directors has established aCompensation Committee in accordancewith article 7:100 of the new BelgianCompanies Code and article 21 of theCompany’s Bylaws.

The Compensation Committee advises andassists the Board of Directors. It conducts itswork under the supervision andresponsibility of the Board of Directors. TheCompensation Committee takes care topreserve free and open communication withthe Executive Committee.

Composition of the Compensation 5.1.2.3.2.Committee

The Compensation Committee consists ofthree non-executive Directors. The majorityof members are independent as defined byarticle 7:87, section 1 of the new BelgianCompanies Code. The CompensationCommittee has the necessary expertise inmatters of compensation.



The term of office of CompensationCommittee members is three years, anddoes not exceed their term of office asDirectors. The term of office asCompensation Committee members maybe renewed at the same time as their termof office as Directors.

The Compensation Committee is chairedby a non-executive Director.

The Chairman of the CompensationCommittee oversees its work and takes allnecessary steps to create a climate of trustwithin the Committee by contributing toopen discussions and encouragingconstructive debate.

Members of the Compensation Committeechoose a Secretary from among themselves.

At 31 December 2019, the CompensationCommittee consisted of Jean Mounet, RafiKouyoumdjian and Anne Lange. TheCommittee is chaired by Jean Mounet.

Role of the Compensation 5.1.2.3.3.Committee

The Compensation Committee assists theBoard of Directors, under the responsibilityof the Board, in all matters relating to thecompensation paid to the Chairman andChief Executive Officer, the Directors, andthe members of the Executive Committee.

More specifically, on the recommendationof the Chairman and Chief ExecutiveOfficer, the Compensation Committee is incharge of:

making proposals and recommendations•to the Board of Directors with respect tothe policy for compensating Directors andmembers of the Executive Committeeand, if required by law, any resultingrecommendations which the Board ofDirectors must submit to the shareholdersfor approval;

making proposals and recommendations to•the Board of Directors with respect to theindividual compensation of Directors andmembers of the Executive Committee,including the variable portion andlong-term bonuses (long-term shareincentives) – whether or not shared-based –granted as stock options or other financialinstruments, termination benefits and, ifrequired by law, any resultingrecommendations which the Board ofDirectors must submit to the shareholdersfor approval;

making recommendations and proposals to•the Board of Directors about setting andassessing performance targets linked to theindividual compensation of Directors’ andExecutive Committee members;

drafting the compensation report, in•accordance with article 3:6 of the newBelgian Companies Code, which issubsequently appended to the corporategovernance statement;

commenting on the compensation report•during the Ordinary General Meeting;

submitting recommendations to the•Board of Directors with respect to theterms and conditions concerning theDirectors’ and Executive Committeemembers’ employment or other contracts;

generally carrying out all the tasks•assigned by the Board of Directors withrespect to compensation.

In accordance with article 21 of the Bylaws,the Board of Directors grants theCompensation Committee the power toimplement Board decisions with respect tostock option plans or any other existing orfuture plans for granting financialinstruments such as warrants, i.e., issuingstock options or other financial instrumentswithin the limits authorised by the Board ofDirectors, to whom the CompensationCommittee is accountable.



Functioning of the Compensation 5.1.2.3.4.Committee

The Compensation Committee meets asoften as necessary and at least twice a year.

Compensation Committee meetings areconvened by the Chairman, who alsodetermines the agenda. A Director orChairman’s Council member may ask theChairman of the Compensation Committeeto place any item he or she considersappropriate on the agenda.

Except in the event of emergenciesidentified by the Chairman of theCompensation Committee, Notice ofCompensation Committee meetings (andthe agenda for said meeting) are sent byany means ordinarily used by the Companywithin a reasonable period before themeeting is due to take place.

Before meetings of the CompensationCommittee, its Chairman is responsible forensuring that members receive accurate,complete and clear information and allrelevant documents related to the items onthe agenda.

The Executive Committee is required toprovide all necessary information, and theCompensation Committee may request anyclarification it deems necessary.

The Compensation Committee may inviteany persons whose presence it deems usefulto attend its meetings. The Committee mayask for an independent professional opinionon issues it considers necessary to performits duties, at the Company’s expense.

Directors may not attend CompensationCommittee meetings that deliberate ontheir own compensation, and therefore maynot take part in any decisions in this respect.

The Chairman and Chief Executive Officermay participate in meetings of theCompensation Committee in an advisorycapacity when said meetings discusscompensation for other Chief ExecutiveOfficers and other members of theChairman’s Council.

The Compensation Committee candeliberate if at least two of its members arein attendance or legitimately represented.Decisions are made by a majority of votescast.

Conflicts of interest5.2.The Company’s corporate officers mustcomply with the recommendations ofarticle 7:96 (conflicts of interest between theCompany and a Director) and 7:97(intragroup conflicts of interest) of the newBelgian Companies Code.

To comply with the Corporate GovernanceCode, the Company has issued a number ofrecommendations for its Directors and themembers of its Executive Committeeconcerning transactions and othercontractual relationships between theCompany (and any companies related to it),its Directors and the members of itsExecutive Committee when suchtransactions and other contractualrelationships are not covered by legalprovisions on conflicts of interest. Theserecommendations are outlined in theconflicts of interest procedure adopted on22 November 2012 by the Board, and in thestipulations outlined in the Board ofDirectors’ internal rules and in the ExecutiveCommittee’s internal rules relating,respectively, to conflicts of interests ofDirectors and of members of the ExecutiveCommittee.



In short, Directors and Executive Committeemembers must at all times act in theinterests of the Company and itssubsidiaries. They apply rigorous disciplineto exclude potential conflicts of interest inrespect of personal assets, professional orother aspects as much as possible, and tocomply strictly with rules on conflicts ofinterest between Econocom and itsDirectors or Executive Committee members.

When a Director or a Executive Committeemember, directly or indirectly, has aninterest that is contrary to a decision ortransaction made by Econocom, bearing onpersonal assets or not, he or she shallimmediately inform the Chairman of theBoard, and, if he or she is a Director, theother Directors, and if he or she is amember of the Executive Committee, theother members of said Committee, no laterthan the beginning of the meeting at whichthe matter giving rise to the conflict isdiscussed. He or she shall then not take partin the discussion or vote on the matter. TheChairman shall then decide whether it isappropriate to make a report to the Board.

The transactions covered by this section aresubmitted to the Audit Committee, whosetask is to ensure that said transactionscomply with the procedures outlined aboveor, where applicable, that they are normaltransactions conducted under normalmarket conditions and guarantees generallyapplied to transactions of a similar nature.The Audit Committee found that almost allof agreements reached during the 2019financial year were normal transactionsconducted under normal market conditions.

All material agreements between Econocomgroup and its related parties are disclosed innote 22, “Related party information”, to theconsolidated financial statements in the 2019annual report.

Biographies of 5.3.DirectorsJean-Louis Bouchard began his career in1966 as an Account Manager at IBM,spending two years at IBM World Trade inNew York. Between 1971 and 1981, hecreated and served as Chairman and ChiefExecutive Officer of Informatiques InterÉcoles. In 1973, he founded EuropeComputer Systèmes (ECS), where he servedas Chairman until he sold hisnon-controlling interest to Société Généralein 1984. In 1982, he founded Econocom inBrussels, and in 1985 became Chairman ofthe Executive Board of EconocomInternational NV. In 1987, he was named“Entrepreneur of the year” by Challengesmagazine.

Robert Bouchard began his career asnegotiator with Cardif in 1995. In 1997, hebecame an executive shareholder of anumber of restaurants in Paris (La Gare,L’Ampère, Meating and Carmine). In 2010, hetook over as Chairman of APL (specialising inthe design, construction and maintenance ofdata centres), and is currently its majorityshareholder. He was Chairman of DigitalDimension from November 2016 toNovember 2017, Group Chief OperatingOfficer from June 2017 to March 2018, andGroup Chief Executive Officer from March2018 to November 2018. Robert Bouchard isJean-Louis Bouchard’s son.

Walter Butler, who has French and Braziliancitizenship, is a graduate of the ÉcoleNationale d’Administration (ENA). He beganhis career with the Inspectorate General ofthe French Ministry of Finance before goingon to become Executive VP of GoldmanSachs in New York. He founded Butler CapitalPartners (BCP) in 1991. His group currentlyspecialises in private equity and credit inEurope (Butler Investment Managers inLondon), as well as investing in companies,including Osiatis. Walter Butler was formerlyChairman of the French private equity andventure capital association (AssociationFrançaise des Investisseurs en Capital –AFIC), a member of the French Strategic



Investment Fund Committee (Comité duFonds Stratégique d’Investissement – FSI)and France’s National Economic AnalysisCouncil (Conseil d’Analyse Économique de laRépublique Française).

Adeline Challon-Kemoun began her careeras a communications consultant with Image7 and then joined the Office of the FrenchMinister of the Economy and Finance. Shesubsequently held executive managementpositions (Euris and Rallye) and served asCommunications Director for major groups(Casino, France Télévisions and Air France).She was Executive Vice President ofMarketing, Digital & Communications for AirFrance-KLM and a member of the group’sExecutive Committee from July 2015 toJune 2017. In April 2018, she joined theMichelin Group as Director of Engagementand Brands, and became a member of theGroup Executive Committee. She has beenan independent Director of BourbonCorporation since March 2017. As a specialistin marketing and digital, she has a soundunderstanding of the expectations ofindividual and corporate customers.

Gaspard Dürrleman began his career withBasaltes group in 1982. He went on to headEconocom Trading from 1985 to 1987, thenInnovation et Gestion Financière from 1987to 1992. He was subsequently head of theleather goods division at Hermès until 2000,and then of Delvaux in Belgium until 2003.He then joined Arthus-Bertrand group,which he ran for three years. In 2009, hebecame Chairman and CEO of Cambour, ajewellery manufacturer, a position he helduntil the end of 2015. Since then, he hasestablished a consultancy business withlarge French and international groups in theluxury goods sector and taught in a businessschool. Since then, in parallel with itsconsultancy activity with players in theluxury market sector, he has taught in abusiness school and in 2018 he was awardeda University Teaching Diploma inmulti-disciplinary health studies inconjunction with Université Paris 7 Bichat.

Véronique di Benedetto started out as anAccount Manager at IBM. In 1985, shebecame a sales agent before beingappointed Sales Director with ECS, and thentaking over the Group’s internationalactivities, and finally becoming ManagingDirector in 2009. After the merger betweenEconocom and ECS, she was appointedDeputy Managing Director of the newGroup, running operations in France. In 2015,she was appointed Vice-Chair France,responsible primarily for CSR strategy andstart-up supervision in various sectors,including education and culture. She wasalso appointed Vice Chairman of SyntecNumérique.

Bruno Grossi worked for over 20 years atAccenture, where he was partner, in chargeof the telecom and media sectors in Franceand in Benelux. Co-Chairman of Osiatisbetween 2010 and 2013, before its mergerwith Econocom group in September 2013,he is now its Chief Executive Officer.

Rafi Kouyoumdjian began his career as anAccount Manager for IBM in 1983. He joinedEconocom group in 1987, spending 13 yearsin various positions of responsibility,including senior management from 1995 to2000. In 2001, he became Chairman ofLiberty Surf Group (now Tiscali France),before serving as Chief Executive Officer ofNextiraOne Group from 2006 to 2010. He wasChairman of Vizada in satellitecommunications from 2011 until its sale.Since June 2015, he has been a shareholderand manager of Oteis, an engineeringcompany in construction.

Anne Lange began her career in the Officeof the French Prime Minister, where she wasin charge of the supervisory body for publicbroadcasting. She was then appointed headof e-business for Europe at Thomson, thenCompany Secretary of the Forum for Rightson the Internet. She went on to hold anumber of senior management positionswith Cisco, in France and in California. Morerecently, Anne Lange embarked on anentrepreneurial venture as co-founder andCEO of Mentis, a software company



specialising in the Internet of Things, whichhas since been sold. She now splits her timebetween her Directorships and her role as aSenior Advisor, working with CEOs andhelping them deal with major digitaltransformation challenges. She is a Directorof Orange, Pernod Ricard, FFP and Inditex.Her strong technological skills, especiallyrelated to the world of the Internet, give hera clearer understanding of the majorchanges underway in the digital world.

Marie-Christine Levet is one of France’spioneering figures in the Internet world andhas over 25 years’ experience in the newtechnologies sector as both an entrepreneurand investor. She has run several FrenchInternet and media companies (Lycos,Club-Internet, Tests group, etc.) Leveragingher entrepreneurial experience,Marie-Christine Levet switched over to theinvestment sector, taking part in thefounding of Jaina Capital, one of France’sfirst investment funds specialising in seedfunding. Convinced of the educationsector’s need to undergo transformation,Marie-Christine Levet founded Educapital,the first European investment fund devotedto the innovative education sector, inOctober 2017. She is also a Director of Iliad,Maisons du Monde, SoLocal and AFP. Herentrepreneurial experience as both aninvestor and Director of pioneeringcompanies in the digital market as well as indigital transformation consulting is an assetin supporting Econocom group’sdevelopment strategy.

University in Strategic Marketing. Heoccupied a number of positions with ITmanufacturers (IBM and Bull). In 1988, hejoined Sopra Group as Managing Director,becoming Vice-Chairman in 2005. He is nowa Director of Sopra Banking Software andSpecial Advisor to the Chairman. He wasChairman of Syntec Numérique from 2003 to2010, and is now Chairman of the StatutoryCommittee. He is also a Director ofHorizontal Software and Chairman ofTrigone SAS, a management consulting firm.

Jean Mounet trained as an engineer (ESCPELyon). Holder of a doctorate in PhysicalSciences, he graduated from Stanford

Jean-Philippe Roesch began his careerwith six years at Arthur Andersen. He joinedEconocom group at the end of 1989 as ChiefFinancial Officer for Econocom France. Afterheading various subsidiaries within theGroup, Jean-Philippe Roesch held a numberof roles (Company Secretary of Econocomgroup in 2001, Deputy Managing Director in2004), culminating in his appointment asManaging Director in 2006. He steppeddown at the end of 2016, before returning toa Support role in the Executive Committee.He is a member of the Supervisory Board ofLinkfluence SAS.

The Econocom Board of Directors declaresthat, to its knowledge, none of the Directorshave ever been convicted of fraud or subjectto any official or public indictment and/orsanction preventing him/her from acting asa member of the management orsupervisory body by any legal or supervisoryauthority, and that none of the Directorshave been prevented by a court of law fromserving as a member of the governing bodyand that, in this capacity, they have neverbeen involved in bankruptcy proceedings.


02 group overviewresearch & development

Research & Development6.Innovation and R&D are major assets forachievement of the “e for excellence”strategic plan. The Group is applying adynamic of digital transformation bycreating differentiating solutions to supportits development strategy and achieve itsoperational excellence objectives.

In 2019, R&D efforts were pursued incontinuity with the areas developed in prioryears with the aim of providing intensivesupport and assistance for any innovativesolutions produced by our customers.

R&D efforts focused particularly on the areasof data visualisation (DATAVIZ), decisionsupport, developing integrated solutions inthe area of IoT, image recognition in realtime, 5G microservice billing and machinelearning, applied to process automation.

Econocom has enhanced its researchactivities by recruiting young Ph.Ds whoare experts in Data Analyst BusinessIntelligence to ensure the development ofits DATA practice around the BiBoard andMarS offers.

Collaboration with the academic world tookshape with the signing of trainingagreements, allowing our employees tospecific training sessions at the ClaudeBernard University in Lyons in the areas ofCloud Computing and the Interoperability ofInformation Systems.

purposes applied to the IT infrastructure andmore particularly to our managed servicesoffers (supervision, operation, administration)devoted to the networks (LAN, WAN) and totelecommunications (telephony operators).

Another research area focuses on theobjectives of operational excellence, thestudy of complex data for forecasting

Optimising costs

Controlling the resources consumed by thepublic Clouds and the quality of serviceoffered to its customers have led Alter Wayto new partnerships and R&D projects in2019. The 5GBiller solution, for billing ofTelecom 5G platforms based on Kubernetesinfrastructures provides configurable pricingrules and can be used to optimise the ratiobetween supplier costs and the price of theservices or products sold to their customers.A consortium of international users was setup at the end of the year to participate inthe pilot phase of the product, conducted byEngineering Group.

AI, a European research agreement

In the area of artificial intelligence, AlterWayhad the honour of obtaining a Europeanresearch agreement in connection with theOpenREQ project (H2020). Indeed, theCompany has obtained preliminary resultsin automation by machine learning,surpassing 97% effectiveness in certain NLUclassification exercises. With this degree ofefficiency the Company can envisageplacing some highly innovative automaticmechanisms in production among itscustomer support business units.


02group overviewresearch & development

2019, first publications and contributionto the advancement of research onemerging technologies

2019 saw the first publications on the topicsof orchestration and optimisation of themicro-services Cloud, as a continuation ofthe Wolphin Open Source project, but alsodoctoral work in R&D, which is promisingfrom an academic standpoint with twoarticles already published in Europeanconferences (OLA and ROADEF) for Q1 2020.

year devoted to optimisation andautomation, with a business focus ondecentralised infrastructures like Edge andFog and their energy efficiency.

It also proved to be a gratifying year ofexploration (5G, AI), both in terms ofpractical results with numerouscontributions and a new product and interms of new partnerships. Hence 2020promises to be a year devoted to continuingto work on AI and Cloud platforms, and a

Using these indicators and Econocom’sexpertise, we help our clients identify thelevers for improving performance andcreate action plans to accelerate the digitaltransformation.

For some of its business, the Group isentitled to a research tax credit (Créditd’Impôt Recherche) in France. As a result, itis able to forge ahead with bold medium-and long-term projects that will offer asignificant advantage in terms of enablingthe Group to differentiate its technologicaloffering.


02 group overviewprincipal investments

Principal investments7.In addition to developing new products andsoftware tools, and recruiting new sales staffand engineers, Econocom group carries outexternal growth transactions in order toacquire specific skills, accelerate its growthand increase its profitability.

The Group’s main investments over the lastthree years are described below.

20177.1.The deals carried out in 2017 are as follows:

Digital Services and Solutions•

In April 2017, the Group acquired 100% ofBIS, a multimedia solutions integratoroperating under Dutch law andcomprising four companies (three in theNetherlands and one in Belgium). This dealenabled Econocom to bolster its positionin the buoyant multimedia segment(digital signage, videoconferencing rooms,smart buildings, etc.) and to roll out itsentire offering by developing newcross-functional solutions in the Beneluxcountries. BIS employs over 220 peopleand reported revenue of €55 million in2017.

Through its Alter Way Satellite, Econocomacquired 100% of LP Digital Agency, aFrench specialist in digital strategyconsulting for major companies, at the endof April 2017. LP Digital Agency reportedrevenue of €1.8 million in 2017.

particularly in the retail and logistics fields.Jade Solutions reported revenue of morethan €13 million in 2017.

At end-July, in the United Kingdom,Econocom acquired 85% of Jade Solutions,a specialist in crowd WiFi and professionalmobility solutions for major companies,

In October 2017, the Group also acquired80% of Energy Net, a B2B integrator andreseller of Apple solutions, with which it wasalready a partner. Thanks to the expectedsynergies with the Technology Management& Financing business, this acquisition willfacilitate the launch of innovative solutionson the German market, combininghardware, applications and services, chargedas a fee. Energy Net reported revenue ofmore than €55 million in 2017;

Lastly, Exaprobe, an Econocom groupSatellite, acquired 51% of Aciernet, a Frenchnetwork and security solutions integratorwith specific expertise in large datacentres. As a Cisco Gold partner, thecompany has very complementaryexpertise to the Group’s. Aciernet reportedrevenue of over €183 million in 2017, and isexperiencing robust growth driven by thestrong momentum of its main customersand its international rollout, particularly inNorth America;

Changes in ownership interest•

Econocom acquired all of the shares heldby Georges Croix, a minority shareholder ofDigital Dimension, bringing its stake to100% from 1 October 2017. In the firstquarter, Econocom acquired a further 20%of Helis’ capital, bringing its stake in thisSatellite to 65%. In the first quarter,Econocom acquired a further 35.58% ofEconocom Brazil’s capital, bringing itsstake to 92.85%.


02group overviewprincipal investments

OTHER INTERESTS ACQUIRED AND INVESTMENTS

In early May 2017, Econocom acquired aminority stake (40%) in the capital of JTRS, adigital solutions integrator in the educationsector in the United Kingdom. JTRS is aleading partner of Apple and GoogleEducation in Britain.

20187.2.The deals carried out in 2018 are as follows:

acquisitions in “Digital Services and•Solutions”

During the first quarter of 2018, the Groupacquired two companies to reinforce itsknow-how in digital transformation andcontinue its strategy to develop in valueadded services.

The Group acquired a 60% stake in Spanishcompany Altabox, a specialist in digitalmarketing services, in order to enrich thecustomer experience at points of sale. Thecompany’s innovative offering includes thedesign and deployment of digital signage,sensory and auditory marketing, and trafficand data analytics. This acquisition offersnumerous opportunities for synergies withthe Group’s other skills in the Retail sector,particularly those of the Caverin, Gigigo,Rayonnance, or Jade Solutions Satellites.With a strong portfolio of Spanish customers,the company achieved a turnover of€9 million in 2017.

Furthermore, Econocom acquired 100% ofBDF, an Italian company specialising inmanaged services in the Banking &Insurance sector. BDF reported revenue of€44 million in 2017.

In October 2018, the Group acquired,through Helis SAS, all of the shares ofUpstream and its subsidiary Simstream, aspecialist in engineering and integrationservices related to audio and videostreaming. Upstream reported revenue of€4.5 million in 2017.

In October 2018, the Group acquired 100% ofOsones through Alter Way. Osones is aspecialist in private cloud solutions,infrastructure as a service, and containerorchestration systems. The Company postedrevenue of €1.5 million in 2017.

OTHER INTERESTS ACQUIRED AND INVESTMENTS

Aciernet: via its 90%-owned subsidiaryExaprobe, the Group signed an agreementwith the minority shareholders in July 2018providing for purchase of the remainingequity interest at a fixed price. The interestrate thus went to 100% at the level ofExaprobe, i.e. 90% at the level of Econocom.

ASP Serveur: the Group acquired theminority interest (20%) in October 2018,thereby increasing its interest to 100%.

Econocom Brazil: in the fourth quarter of2018, Econocom acquired the outstandingshares from the minority shareholder (i.e.7.15% of the share capital) thus increasing itsstake to 100%.

Caverin: Econocom group SE acquired allthe non-controlling interests (33.34% of thecapital).


02 group overviewadditional information

In 20197.3.OTHER INTERESTS ACQUIRED AND INVESTMENTS

Synertrade: the Group through its subsidiaryDigital Dimension, acquired the minoritystake (10%) in July 2019, thus raising its staketo 100%.

Gigigo: Econocom group SE acquired all thenon-controlling interests (30%) in July 2019.

Infeeny: during the first half, Econocomgroup SE acquired 9.66% of the company’scapital.

JTRS: Econocom group increased its stake inthe company through the acquisition ofshares from a minority shareholder (5%).

Altabox: at end-2019 the Group exercisedpart of its options on 15% of the company’scapital, raising its interest to 85%

Additional information8.Legal and arbitration 8.1.

proceedingsGovernmental, legal or arbitrationproceedings against the Group, pending orthreatened, are subject to provisionsestablished in accordance with IAS 37,taking into account all available relevantinformation on such proceedings.

which the Group may be party as a result ofconducting its business. This amount wasincreased owing to a commercial disputewhich could represent a counterparty riskfor the Group.

The total consolidated amount of provisionsfor all of the Group’s disputes (see note 16 tothe consolidated financial statements)includes all outflows of resources (excludingany possible reimbursements) deemedlikely for all types of claims and litigation to

Major contracts8.2.In the course of its operations, the Groupsigns substantial contracts with itscustomers, suppliers, funders and otherpartners, some of which are binding forseveral years. The importance of theseparties is outlined in chapter 4, section 3,“Dependency Risks”.


03corporate social responsibilityOur approach 68

CSR stakes and mission 68The organisation 68Our roadmap 68

Actions and highlights 69

References and standards 69Labels and certifications 69Commitments to the SDG (Sustainable Development Goals) 69Major aims and achievements: 71

Nurture our excellence through 1.responsible commitment 72

Position ourself as a committed 1.1.employer 72Conduct a demanding 1.2.environmental policy 80Be an ethical and responsible player1.3. 83

Support the new responsible uses 2.of our customers and users 86

Develop our offer of green and 2.1.responsible products and services 86Promote useful and responsible 2.2.digital business and the circular economy 87Boost responsible innovation in 2.3.internal and external collaborations 89

Federate an ecosystem 3.to create shared value 90

Partnerships in the education 3.1.and university sector 90Become the partner of choice for 3.2.innovative companies and integrate them into our offers 94Develop our local roots3.3. 95


03 corporate social responsibilityour approach

Our approachCSR stakes and missionAccording to a CNRS study of May 2018,digital services represent between 6% and10% of the world’s energy consumption. Thesame study estimates that only 18% of thematerials used to manufacture portablecomputers are recycled in Europe. TheEconocom group views these figures as achallenge, after having made the fightagainst digital waste a major focus of its CSRstrategy.

How will this be done? Firstly by designingand deploying truly useful and responsibledigital technologies for end users, thatcontribute to the overall performance andcompetitiveness of organisations. Secondlyby ensuring the recycling and re-use ofequipment. Econocom’s mission regardingsocial responsibility is: to provide ourcustomers and their users with effective andresponsible digital solutions, generating apositive impact.

This commitment to useful digital services isevident in, amongst other things, the Group’sefforts to improve the energy efficiency of itsdigital infrastructure, its sponsorship oforganisations combating exclusion and itscommitment to the re-use and recycling ofits equipment through social supportorganisations. Finally, the Econocom Group’ssocial responsibility cannot be envisagedwithout an appropriate HR strategy and aresponsible environmental policy.

The organisationEconocom’s CSR policy involves all Groupemployees and is implemented by adedicated organisational structure. The CSRDepartment is headed by Véronique diBenedetto, Vice Chairwoman France. Thisdepartment presents the CSR policy to theBoard of Directors and other managementbodies.

The policy is managed by a CSR SteeringCommittee comprising 7 Directorsrepresenting the Group’s main functions. Itapproves the strategic priorities andobjectives of the CSR programme andensures that objectives are met.

A panel of CSR functional and geographicalcorrespondents has been created. Thesecorrespondents are part of the operationalteams of members of the CSR SteeringCommittee. They are responsible formeeting objectives in their respectivescopes. They are responsible for theoperational implementation of the actionplans approved in Committees, and they arealso the ambassador for the policy with theirteams.

Our roadmapEconocom adopted a new CSR strategy in2019 and implemented it in 2019. Thisambitious and demanding road mapincludes all of the significant issuesidentified in the survey of internal andexternal Group stakeholders. It highlightsthe points which Econocom would like todevelop over the next few years.


03corporate social responsibilityactions and highlights

NURTURE OUR EXCELLENCE THROUGH RESPONSIBLE COMMITMENT

Position ourself as a committed employer.•

Conduct a demanding environmental•policy.

Be an ethical and responsible player.•

SUPPORT THE NEW RESPONSIBLE USES OF OUR CUSTOMERS AND USERS

Guarantee an extensive and simple user•experience, as a service.

Promote useful and responsible digital•business and the circular economy.

Boost responsible innovation in internal•and external collaborations.

FEDERATE AN ECOSYSTEM TO CREATE SHARED VALUE

Support new uses linked to useful digital•business in the education sector, and GreenIT.

Become the partner of choice for•innovative companies and integrate theminto our offers.

Develop our local roots.•

Actions and highlightsReferences and standards

Since 2012, the Econocom group has•joined the United Nations Global Compact.Through this membership, Econocom iscommitted to respecting and promotingthe ten principles of the Global Compact.These principles concern: human rights,labour law, the environment and the fightagainst corruption.

Econocom was honoured with the•Ecovadis Silver medal for its CSRperformance.

Labels and certificationsThe scope of the ISO 9001 certification•concerns more than 6,000 employeesacross nearly 50 sites and covering eightcountries: Belgium, Spain, France, Italy,Luxembourg, Morocco, the UK and theNetherlands.

ISO 27001 certifications are managed•locally in France, Spain, Italy and Morocco.

Econocom uses the ISO 26000 standard to•ensure compliance with the guidelines interms of social responsibility.

Commitments to the SDG (SustainableDevelopment Goals)Econocom recognises the urgency forprivate and public sector players toconverge together towards the 17Sustainable Development Goals identifiedby the United Nations. As part of itscommitment, Econocom has identifiedgoals that fall under a priority commitment,active contribution, or participation. 11 goalshave been identified and included into theCSR policy.


03 corporate social responsibilityactions and highlights

PRIORITY COMMITMENTS:

goal no. 12: responsible consumption and•production;

goal no. 9: innovation and infrastructure;•

goal no. 4: access to quality education;•

goal no. 10: reduced inequalities;•

goal no. 17: partnerships for global goals.•

ACTIVE CONTRIBUTION:

goal no. 13: fight against climate change;•

goal no. 5: gender equality;•

goal no. 8: access to decent jobs.•

PARTICIPATION:

goal no. 3: access to health;•

goal no. 11: sustainable cities and•communities;

goal no. 7: use of renewable energies.•


03corporate social responsibilityctions and highlights

Major aims and achievements:Gender balance

Achievement: creation and deployment ofan internal programme, “Econocom DigitalWomen” and signature of the manifesto toprovide retraining for women in the digitalbusinesses.

Aim: the Econocom group aims to improvewomen’s access to IT jobs by 2022, toattract more female talent and to improvetheir integration into the Company.

Solidarity

Achievement: 80% of all our reconditionedIT equipment is processed by companieswhich are partners in the social economy(which every year represents about500,000 products).

Aim: the Econocom group aims to have allits IT equipment processed andre-conditioned by companies in the socialeconomy by 2022.

Environment

Achievement: as part of its commitment toreducing IT waste, Econocom hasregistered a 28% reduction in theconsumption of IT equipment by itsemployees.

Aim: by 2022, the Econocom group aims tocontrol and reduce consumptionthroughout its information systems.

Circular economy

Achievement: Econocom commits to thecircular economy by developing essentialproject finance expertise for digital projectsand technological equipment, via “as aservice” finance solutions, and offeringswhich enable companies to manage theirdigital projects in real time and strictlyadjusted to usage.

Aim: Econocom is aiming to accelerate, by2022, the creation of unique financial andtechnological offerings which reduce theenvironmental IT footprint of its clients.


03 corporate social responsibilitynurture our excellence through responsible commitment

Nurture our excellence through 1.responsible commitmentEconocom’s CSR policy is focused on applying good practice within the Group, firstlythrough an HR policy focused on developing employee satisfaction, and then through itsdemanding environmental policy, and finally, by establishing itself as an ethical andresponsible player.

Position ourself as a committed employer1.1.Through its hiring policy, professional driving force behind corporate socialdevelopment plans, after-work social events, responsibility (CSR) and the Group’s tophealth programmes and employee ambassadors. At 31 December 2019,satisfaction surveys, Econocom has Econocom had 10,323 employees, withcommitted to making its employees the nearly 85% in Services.

Breakdown of workforce by business

31 Dec. 2019 31 Dec. 2018

Technology Management & Financing 526 634

Services 8,314 8,891

Products & Solutions 626 441

Holding and support functions 739 728

Total employees 10,205 10,694

Sales agents 118 118

Total 10,323 10,812

Breakdown of workforce by geographical area

31 Dec. 2019 31 Dec. 2018

France 7,173 7,444

Benelux 725 740

Southern Europe 1,932 2,001

Northern & Eastern Europe/Americas 493 628

Total 10,323 10,812


03corporate social responsibilitynurture our excellence through responsible commitment

Econocom’s Human Resources policy is designed to attract and retain talent, both essentialcontributors to the Group’s long-term performance.

HIRING AND ONBOARDING 1.1.1.POLICY

Talent acquisition

The Group wants every employee to be ableto grow in an exciting and rewarding workenvironment, by carrying out diversified andmeaningful assignments. This begins withputting the right skills in the right places, bymanaging hiring and mobility. Econocomhas defined three priority areas of action tomeet the expectations of both current andfuture employees:

increase presence on social media. These•platforms give applicants and employeesthe opportunity to interact, and primarilytarget younger generations;

make good use of Group employees’•networks to hire people with more targetedprofiles who embrace Econocom’scorporate culture;

promote internal employee mobility.•

A new module will be deployed in thesecond quarter of 2020 and will make itpossible, via an employee area, to:

refer potential candidates using the•Group’s website or mobile app;

manage their career with a short•procedure for applying to the Group’s joboffers;

share offers on social media.•

In 2019, the Group hired 1,840 people inFrance.

Number of new hires by region in 2019

Number of newhires in 2019

Benelux 76

France (Planet + Exaprobe + Infeeny + other Satellites)

1,840

Spain 291

Italy 30

Other countries 235

2,472

Talent integration

New hires benefit from a personalisedonboarding programme aiming tointroduce fellow team members, gain abetter understanding of the Company’sorganisational structure and learn moreabout the business activity of theirdepartment.

To round out the programme, new hires alsotake part in a nation-wide onboardingseminar known as the Welcome Day, wherethey are introduced to Econocom’sorganisation and businesses. TheseWelcome Day seminars are extremelypopular, with a 100% satisfaction rate withparticipants.

Employees working at customer sites, onthe other hand, attend Welcome Dates.Organised every quarter depending on theregion, Welcome Dates allow them todiscover the organisation and working oftheir local branch office and localstakeholders, as well as about nationalcommunication tools and the Group’scareer development programmes.



PROFESSIONAL 1.1.2.DEVELOPMENT

Training

Econocom group supports the careerdevelopment of its employees by providinga wide range of training options.

The Group’s training programme offersthree main types of courses:

Learn’up: the digital learning platform•accessible to all;

the Econocom Management Academy•aimed at managers;

training actions that meet the specific•needs of the Group’s businesses andactivities.

To meet the training requests of allemployees and encourage them to engagein self-training, Econocom draws on thewealth of opportunities available throughdigital technology, and has redesigned itsdistance training offer. MOOCs are alsooffered throughout the year, particularly onsubjects relating to the digital transformationof the Group’s businesses.

In 2019, Econocom rolled out an innovativedigital training offering in a SPOC format onsoft skills: project management, flexibility,human resources, conflict management,organising meetings, communication andmanagement. Almost 230 were able tobenefit from this distance training, on avoluntary basis, after approval bymanagement.

The Econocom Management Academy wasset up to develop managerial skills. Itstraining courses help managers prepare forthe digital transformation and thecollaborative, cross-disciplinary practicesthat come with it.

Econocom believes that training is a keyfactor in both employees’ professionaladvancement and the Group’s success. InFrance, 40,000 hours of training wereprovided in 2019.

Distribution of employees trained bybusiness in France in 2019

Internal digital transformation

Econocom has introduced a digitalacculturation training programme calledthe “digital passport”. The goal is to improveemployees’ knowledge and awareness ofthe impact of digital technology on theirbusiness, and help them learn to use thenew tools available to them so that digitalsolutions can be a true source ofprofessional development. In 2017, almost500 employees in France signed up on avoluntary basis to obtain the digitalpassport. The last training session was setup in 2019, training almost 90 more people.

Digital transformation also involves adaptingworkspaces. To this end, Econocom hasredesigned the layout of its offices to createspaces where people can come together toshare ideas under the watchwords ofco-creation and collaboration. The Group’sdifferent sites are equipped with digitalsolutions, such as displays in walkways toenable staff to perform quick tasks (reserve ameeting room, find their way around, checkavailable offices, etc.) and web conferencingsolutions that can be used either from ameeting room or a work device, such as acomputer, tablet, smartphone, etc. Nearly3,000 employees benefit from workingconditions adapted to changes in theirbusiness and work methods.



A “Digital Bar” has been set up at the Group’smain site, and the concept will gradually berolled out at its other major sites. Thesephysical spaces provide a forum foremployees and users to get answers to theirquestions about digital tools, along withpersonalised guidance. Technical assistanceis also available to help employees and userssolve IT and digital issues.

In early 2018, a new in-house tool calledOneLink was launched to standardise theGroup’s digital practices and resources.OneLink combines all IT solutions anddigital communication systems (intranet,Microsoft Office 365, newsletter, socialmedia, CRM, HRIS, etc.) so that employeescan access all information, documents andcompany news on a single platform.

Career management

Career management and professionaldevelopment of employees are primeconcerns at Econocom and part of astructured process to target specificinitiatives for different employee profiles.Econocom’s Talent Reviews feature topmanagement from each business line, theCareer & Development team and theoperational HR team to discuss the businesschallenges which can be addressed by thehuman resources strategy. These reviews areconducted to prioritise individualdevelopment actions based on identity ofemployees and to ensure that HRprogrammes are in line with therequirements and expectations of eachbusiness line and with employee aspirations.

EMPLOYEE SATISFACTION1.1.3.

Econocom operates in a highly competitivemarket and is confronted with labour issuesinherent to the digital sector, including highturnover and downtime between contracts.Employee satisfaction is therefore a keyperformance criteria.

Share engagement programme

Launched in 2011 in France, Econocom’sShare engagement programme aims toenhance work-life balance and improvewell-being in the workplace. The programmeis based on four key focuses: Easy Life,Flexi’work, Share Solidarity and We Care WeCure.

Easy Life: facilitate your day-to-day life

Improving employee well-being in theworkplace means providing a variety ofservices and innovative programmes tosupport employees and make theirday-to-day lives easier.

Flexi’work: adapt your organisation

Achieving harmonious work-life balance iskey to improving employee well-being.Econocom is sensitive to the well-being of itsemployees and therefore offers teleworking,and more broadly mobile working, andpart-time work programmes.

Share Solidarity: support a communitycause

In 2016, the “Engaged, now!” programme waslaunched. The purpose was to promotecharity work performed by employees in theirown time. Employees can therefore submit anapplication to support a charitableorganisation for which they volunteer. Theorganisation will then receive a financialcontribution from Econocom to support itsdevelopment. The organisation’s charitablepurpose must also be in line with the Group’sCSR policy. For three years, fifteen associationshave received this support. The programmehas been a huge success and lets employeesdraw attention to the action taken by theirorganisation and recruit potential volunteers.



In December 2019, the sites of Clichy,Noisy-le-Grand, Les Plessis Robinson,Villeurbanne and Les Ulis offeredemployees the opportunity to take part inthe Father Christmases Green Collection, ofLe Secours Populaires Français. InDecember employees gave new or secondhand toys to children from under-privilegedfamilies.

In September 2019, following the movefrom the Puteaux site, a charitable sale wasorganised with employees, involving thesale of unused IT equipment at attractiveprices. The proceeds from this sale wereentirely paid to two associations supportedby Econocom: Espérances Banlieues andDouble Horizon. 30 computers were alsoprocessed and reconditioned by ourpartner Ateliers Sans Frontières and weregiven to Espérances Banlieues, to be usedto train pupils at school in Asnières (92) indigital technologies.

We Care We Cure: protect your health

In 2017, Econocom launched its employeehealth programme in France:

This programme takes action in two keyareas:

prevention (awareness, screening,•preventive action) is the first step towardsimproving employee health;

Day-to-day support for employees in•treating illnesses.

Happy Life @ Econocom

In 2015, the Group launched the Happy Dejand Happy Cheers initiatives at its sites inFrance. Econocom organises a Happy Dejevery year on the biggest sites of France, anda National Afterwork which brings togetherall the 10 cities concerned. These events allowemployees to meet in a friendly and relaxedatmosphere by participating in the variousactivities offered.

Sports is also a vector for sharing and offeringmutual support. That is why the Group holdssports challenges for its employees everyyear. Since 2016, about 100 runners fromacross all Group businesses, regions andcountries have got together to run inhigh-profile races, such as the Trail dePorquerolles, Paris marathon, Médocmarathon, Porto marathon and, morerecently, the 32-kilometre Run & Bike racethrough the Gorges du Verdon.

DIVERSITY POLICY1.1.4.

Diversity contributes to openness andcollective performance. Econocom hasalways based recruitment and careerdevelopment on the skills of each individual,and condemns any form of discrimination.

Gender parity

Econocom closely monitors gender paritywithin its workforce and encourages womento join this highly male-dominated industryvia, for example, recruitment orengagements in favour of gender equality,especially in the digital sector. The Groupensures that fair treatment is applied interms of representation and promotion tostrengthen the balance between women andmen. Econocom is particularly attentive toensuring that men and women enjoy thesame career opportunities, especially inaccess to training, professional developmentand management positions. Progress ingender parity cannot be made withoutraising the awareness of management andinvolving men in the process. The Group hasincreased the number of women on its Boardof Directors. In 2017, three out of the four newDirectors appointed were women. One thirdof it are now women, in line with the targetset by the Group.



Gender equality index: 88/100 for the Services activity in France

In application of the decree of 8 January 2019, the Services activity gets a score of 88 out of100 points. This index is based on five indicators:

Gender pay gap1.

Gap in rates of individual salary increases2.between women and men

Gap in promotion rates between women3.and men

Percentage of employees returning from4.paid maternity leave who receive a salaryincrease upon their return

Number of the least represented gender5.among the ten highest paid employees

Gender breakdown in France in 2019 (excluding Satellites)

France Supportfunctions

Products &Solutions Services

TechnologyManagement

& FinancingTotal

Women 58 103 370 65 596

Men 18 41 2,332 26 2,417

Total Non-managers 76 144 2,702 91 3,013

Women 125 48 331 78 582

Men 101 53 1,737 84 1,975

Total Managers 226 101 2,068 162 2,557

Total 302 245 4,770 253 5,570

Econocom Digital Women (Femmes du Digital Econocom): an internal programme to encourage women in the IT sector

In June 2019, the Econocom Digital Womeninternal programme was launched under theaegis of the Services activity. This ambitiousprogramme set 3 targets :

create a national community in order to•encourage dialogue and interactionsbetween Services employees;

attract and recruit more women in the•workforce;

innovate and showcase skills and expertise•internally.



Aware of the added value that genderdiversity gives to an organisation, Econocomwould like to encourage the presenceof women in its activities and makedigital sectors, where women areunder-represented, more attractive. TheGroup would thus like to take on a majorchallenge: to make the IT sector morefemale. By signing the Retraining Women inthe Digital Sector Manifesto, Econocom ismaking a commitment, offering a supportprogramme to women who have retrained.The task of Econocom Digital Women is alsoto raise awareness amongst young womenthrough talks in schools and introductoryinternships.

Anti-discrimination policy

Professional integration of young people

For its Services business in France,Econocom group clearly encourages hiringyoung graduates and final-year students onwork-study programmes. Econocom plays animportant role in training by supportingyoung workers every year in internshipsand work-study programmes. Theseundergraduate and master’s-level trainingprogrammes are monitored by tutors intechnical and functional jobs. As Econocom’sServices business has the highestrecruitment needs, it has established specialpartnerships with more than 40 schools.

As part of this commitment to opening thebusiness world to young people, severalyears ago Econocom formed a partnershipwith Journée Nationale des Jeunes (JNDJ).Once a year, the Group opens its doors tomiddle and secondary school students fromunderprivileged backgrounds so that theycan learn more about the business worldand the solutions the Group provides for itscustomers.

The Group works to get its employeesinvolved in its diversity policy and stronglyencourages them to participate in localawareness and integration initiatives.Through the Group’s partnership with theorganisation “100 000 Entrepreneurs” andits network of partner establishments,several managers speak at secondaryschools all over France to give studentsgreater insight into entrepreneurship,intrapreneurship and the business world ingeneral.

Taking its policy to support the professionalintegration of young people a step further,Econocom signed a generation contract forits different subsidiaries in France. Thiscontract has three main goals:

facilitate the long-term integration of•young people into the workforce byproviding access to a permanent workcontract;

encourage hiring senior workers and•keeping them in the workforce;

ensure the transfer of skills and expertise.•

This agreement also aims to createsynergies among the different generationsof employees that make up the organisationand bring their expertise, a source ofstrength and innovative force. For thisreason, the generation contract not onlysupports younger and older workers butalso the generations in between, by givingthem a key role in working with youngpeople, transferring skills and training.

In 2019, Econocom gave the opportunity to50 of its co-workers in France to beEconocom ambassadors through apartnership with the platform My JobGlasses, which connects students withprofessionals. These meetings allow studentswho have completed their baccalauréat toconnect with companies, and thus get thebest advice on internships and jobs.



Breakdown of apprenticeships,internships and work-study contracts inFrance in 2019

Supporting employees aged over 45

Employees in France aged 45 and over canorganise a career development meeting todiscuss their situation and professionaldevelopment plans. They are also given theoption of having a skills assessmentperformed by an authorised independentorganisation. In addition, these employeesenjoy priority access to trainingprogrammes and support from the HumanResources Department to guide themthrough their internal mobility project.Employees aged over 55 also benefit fromadditional measures. They are granted onepaid day of absence every two years to havea health check-up. They can also opt forflexible working time arrangements such aspart-time work, adjusted hours andteleworking. In addition, the Group givesthem the opportunity to pass on theirexpertise in a tutoring programme involvingyounger Econocom employees.

Encourage the hiring of those who haveretrained

the gap between the skills required for thejob and the skills the candidate has. Itfinances all or part of the costs of internal orexternal training. It allows the unemployedto retrain, acquiring It enables retraining inIT skills.

The POEI scheme (Operational Preparationfor Individual Employment) trains newemployees. The POEI scheme thus closes

In 2018 only 10 people (i.e. slightly less than1% of new recruits) were recruited using thismethod. In 2019 we significantly developedthis source of recruits, recruiting114 employees on permanent and temporarycontracts and on work/study placements viathe POEI scheme, representing 8.4% of the1,352 new staff hired in 2019 for the ServicesFrance entity.

For these 114 new recruits, the Grouppresents the following results:

44 women, i.e. 38.5%;•

14 engineers, i.e. 10%;•

6 disabled people, i.e. 5.2%;•

average age 30.4;•

80% permanent contracts;•

the rate at the end of the trial period was•identical to that registered for all newrecruits (10%).

People with disabilities

Econocom has committed to a proactiveapproach to supporting people withdisabilities. After the partnership agreementsigned in 2014 with the Association pour laGestion du Fonds pour l’InsertionProfessionnelle des Personnes Handicapées(AGEFIPH), Econocom has reached a newlevel by signing an agreement in 2018covering all of the Group’s activities inFrance. With this agreement, Econocom iscommitted to increasing its employmentrate for people with disabilities by the end of2020, by implementing an employmentpolicy which aims to meet four majorobjectives:



recruit, train and integrate people with•disabilities;

keep disabled employees engaged•through appropriate career managementand improvement in working conditions;

raise disability awareness among all•internal players and employees ofEconocom;

develop subcontracting with institutions•in the protected environment.

The Mission Handicap is very committedinternally to raise awareness among allemployees to disability, especially during theEuropean Week for the Employment ofDisabled People (SEEPH) and in the contextof management training and recruitmentteams. It is also present at recruiting fairsand school forums and participates inthe Commission Handicap du SyntecNumérique. Additionally, Econocom hasintroduced several awareness initiativesaimed at all staff members, such ase-learning modules showing real-lifesituations of people with disabilities in theworkplace, and a special intranet site.

Conduct 1.2.a demanding environmental policy

Econocom has decided to concentrate theseactions on two emission sources. It also tookactions to reduce the energy consumption ofits IT system.

In 2015, Econocom expressed itscommitment to reducing its CO2 emissionsby 20% across a limited scope. This initialtarget enabled the Group to more clearlydefine its goals to reduce CO2 emissions overa wider scope for its new strategic planlaunched in 2018. Econocom hascommissioned greenhouse gas emissionaudits for its businesses since 2012. Based onthese audits, the Group has identified thebreakdown of its CO2 emissions and its mainemission factors. The results show that theGroup’s main emission factors are its vehiclesand the energy consumption of its buildings.

ANALYSIS AND CONTROL 1.2.1.OF CONSUMPTION OF THE INFORMATION SYSTEM WITH WATT’S GREEN

The share of the digital sector representsalmost 52% of the electricity item of theEconocom group, according to the resultsof the Group’s latest Carbon Audit(December 2019). This is one of the reasonswhy since 2017 the Group has analysed theenergy consumption of its informationsystem with Watt’s Green.

Watt’s Green is a tool, developed byEconocom, for measuring the energyperformance of the information system (IS).The tool gives an overview of the IS’selectricity consumption and energyperformance, helping to initiate or improve apolicy to reduce consumption. In order toanalyse its information system, Econocomdrew up an inventory of data relatedto datacentres, workstations, mobileequipment and meeting rooms. This data isthen incorporated into the Watt’s Greensolution. Four key energy and environmentalindicators emerged:

annual electricity consumption;•

the weight of emissions in CO2 equivalent;•

the annual cost of electricity consumed;•

the WEEE (Waste Electrical and Electronic•Equipment) weight of the global fleet.

The results were then incorporated into theaction plan put in place in 2017 in order toenable comparison between financial years.The aim was to analyse areas forimprovement and to note the effects ofreducing energy consumption and theconsequent carbon impact.


03corporate social responsibilityurture our excellence through responsible commitment

For 2019, Econocom continued itsoptimisation policy, thanks to theintroduction of the Green IT good practices.Energy consumption linked to employees’equipment was reduced by 28% in 2019,notably thanks to:

the systematic replacement of fixed•telephones with mobiles (removal of fixedhandsets);

the widespread use of second-hand•mobile telephones;

the reduction in the consumption of•datacentres (rationalisation of servers etc.);

replacing fixed telephones with the Skype•tool;

the complete renewal of the•multi-function fleet (optimised and withenergy criteria);

the optimisation of the number of office•and multimedia screens;

the development of video-conferencing•(reduction in travel).

These practices have allowed Econocom tocontinue to improve its digital carbonfootprint and record a major reduction in itsCO2 emissions.

Thanks to this measuring tool, Econocomhas significantly reduced the energyconsumption of its equipment andinfrastructure:

Equinix Datacenter (Client and Econocom•IT) -18%;

Noisy Datacenter (Econocom IT) -13%;•

Optimisation of number of servers•(Econocom IT) -15%;

100% renewal and optimisation of•multi-function fleet (class A) -28%;

Optimisation of number of multimedia•screens -17%;

Optimisation of number of laptops -23%;•

Optimisation of number of office screens•-39%.

We note that, thanks to progress made, theIT organisation of the Econocom group ismaturing in terms of Green IT on the“Usage” stage of the equipment life cycle.For 2020, Econocom will continue with itsmeasures to reduce its energy consumption(particularly by its infrastructure) and willlaunch the environmental analysis of the“Manufacturing” and “End of cycle” stageswith the Watt’s Green solution.

RETHINKING TRAVEL TO 1.2.2.REDUCE EMISSIONS

The vehicle fleet is the Group’s largestsource of CO2 emissions. The target is tokeep average emissions at less than 110gCO₂/km, for all types of vehicles. Econocomhas also incorporated electric vehicles intoits fleet. Employees in the Paris region andVilleurbanne can reserve electric vehiclesthat they can use for short-distancebusiness travel, especially between sites.

With all these initiatives, the Group reducedthe CO₂ emissions produced by its vehiclefleet for an average level of 99g CO₂/km in2019, which is equal to 3,600 tonnes of CO₂

emissions for the entire fleet.

The Group favours low-emission transportmethods and encourages its employees touse the train when possible. For travel byplane, Econocom uses companies whichlook to reduce their environmental footprint.



REUSE OF EQUIPMENT TO 1.2.3.EXTEND THEIR USEFUL LIFE

As part of its Technology Management &Financing business (TMF), Econocommanages the return of its used electricaland electronic equipment (EEE). The Grouprecords 500,000 product returns a year, halfof which are specifically in France.Econocom encourages the reuse of all itsproducts to limit the environmental impactcaused by scrapping or incinerating, as forexample, some components contain heavymetals. This approach supports the socialand solidarity economy and is in line withregulations on disability and waste electricaland electronic equipment (WEEE).

WASTE PROCESSING 1.2.4.AND RECYCLING WITH SOCIALLY SUPPORTIVE STRUCTURES

The recycling of electronic equipment isparamount in the Group’s business. Everyyear, the Econocom group recovers 500,000pieces of equipment, half of which inFrance. In order to process such volumes,essentially consisting of returned rentedequipment (computers, screens, servers,tablets, smartphones etc.), Econocom usesAteliers sans Frontières (ASF) and twospecialist companies, ATF Gaia andRecyclea, which combine operations incircular and supportive economies.

Partnership with ATF Gaia

optimising the carbon footprint as soon asthe equipment is taken over. After recovery,sorting and survey, the equipment items aredirected to the ATF repackaging centres orto the nearest dismantling and destructionsites. The Company also deletes data andpreserves the anonymity of the equipmentby performing a certified deletion, thusreducing the risks related to data securityand guaranteeing compliance with theGDPR. ATF also provides Econocom acomplete report, from the collection to theissue of the destruction certificate incompliance with the WEEE directive.

ATF Gaia gives businesses the means to bepart of a more inclusive economy. On theone hand, by accompanying them in theircompliance for the management of WEEEand on the other hand by allowing them tocontribute more directly to the integration ofpeople with disabilities through work. Bysorting as closely as possible to the collectionpoints in its approved centres, ATFconsiderably limits unnecessary transport,

Partnership with Ateliers Sans Frontières

Since 2012, Econocom also collaborates withAteliers Sans Frontières, an entity of theAres group specialising in the managementof WEEE (Waste Electrical and ElectronicEquipment) for reuse and recycling aroundsurvey, audit, test, certified data erasure,mastering and dismantling tasks on ourfleet of computers upon return from lease.Our goal is to give priority to a new usagecycle to the largest possible number ofproducts by reconditioning them.

Ateliers Sans Frontières (ASF) is anintegration project, which welcomes over110 young and vulnerable young people ayear, to help them build their life project,regain their dignity and bring them to astable personal and professional situation.ASF promotes integration throughsolidarity activities with a strong social orenvironmental impact (recycling, circulareconomy, donation of upgradedequipment) that give meaning to the workdone by employees and help motivatethem. In 2017, ASF became one ofEconocom’s major partners, to whom weentrust approximately 30% of our Frenchvolumes to be processed.



A two-fold project, social andenvironmental

In September 2019, Emmanuel Macron andMuriel Pénicaud chose the backdrop of a visitto an Ateliers Sans Frontières (ASF) site topresent the government’s “Pacte AmbitionIAE” (integration through economic activity)project. The French President and theEmployment Minister could observe theoperations of the ASF company, whichcollects and recycles computer equipment,mainly provided by Econocom. This uniquepartnership contributes to a two-foldobjective: it has a social purpose, providingan opportunity to people in great difficulty,giving them inter-personal skills and knowhow which will facilitate their return to theworkplace; it also plays an environmentalrole, reconditioning equipment and giving ita new lease of life. This specialisedpartnership audits equipment, tests it,deletes data and certifies the deletion (inaccordance with GDPR) and repackages it, oras a last resort, dismantles it in order torecycle the parts. In accordance with thephilosophy of a circular economy, thisrecycling only happens with a tiny minority ofthe Econocom equipment, 95% of whichcurrently gets a new lease of life.

Since the start of the relationship betweenASF and Econocom, their activity hasregistered continuous growth in volume andregular improvement in expertise in aclimate of benevolent cooperation andmutual personal growth. As part of its CSRpolicy, Econocom has also extended itscollaboration with the association,entrusting it with the preparation ofcomputer donations. Econocom and ASFcurrently process 60,000 devices per yearwith a team of 15 people. Since the operationstarted, about a hundred of them havefound a job thanks to this activity.

Over the last few years, this has becomeconsiderably more structured andprofessional, thanks to the introduction ofmore rigorous regulation, growth in largee-commerce platforms (FNAC, Cdiscount,Veepee etc.) and specialist players(Backmarket, Recommerce, etc.), and aboveall the popularity with consumers. It providesthe opportunity to access technologies orbrands which, new, would be too expensive,it presents new possibilities in terms of usageor equipment, and there are alsoenvironmental motivations. For all thesereasons, more and more French people areattracted to the possibility of buyingproducts from previous generations, oftenformerly owned by professionals and inperfect working order, for a fraction of theoriginal price. This is why demand isextremely high. Econocom and its partnersalso offer this know-how to businesses, whichalso have to manage the end of theirequipment assets’ lifespan. Thanks to theprocesses put in place and the socialcommitment of its partners, Econocomcontributes in this way to the CSR aims of itsclients, ensuring that they respectenvironmental and safety regulations, as wellas the complete traceability of theprocessing and final destination of theequipment.

This effective collaboration with ASF, and alsowith ATF Gaia and Recyclea, enablesEconocom to play a leading role on thereconditioned digital equipment market.

Be an ethical 1.3.and responsible playerSignatory since 2012 of the United NationsGlobal Compact, the Econocom groupcommits to respecting and promoting the10 fundamental values linked to humanrights, the fight against corruption and theprotection of the environment. Theaffirmation of these values, underpinned bythe Corporate Social Responsibility policy,shows how the Group wants to continue tobe a responsible, honest company,embodying and promoting these valueswithin its ecosystem.



THE ETHICS COMMITTEE1.3.1.

To consolidate its desire to operate as aresponsible and ethical player in theeconomy, in 2019 the Econocom groupappointed an Ethics Committee, whose job isto support the ethical behaviour of theCompany in accordance with the variousregulations which make up the Company’slegal framework. This Committee is made upof four internal Group stakeholders, chosenaccording to their experience and additionalexpertise in ethical issues. It meets severaltimes a year in order to check that the Groupis complying with regulations, and also toensure that the various alerts reported as partof the whistle-blowing mechanism are dealtwith and followed up. It also ensures theupdate of the risk mapping and thatemployees have taken the ethical principleson board.

As part of its ethical commitment, theEconocom group is currently carrying outcompliance work, in particular with theSapin II law, andwithin a wider context, toincreasetransparency in the conduct of itsbusiness. The Group is equipping itself with aCode of Business Conduct whose subjectsinclude how to combat corruption andinfluence peddling, and the publication ofwhich is scheduled for the start of 2020. Awhistle blowing mechanism will alsostrengthen the panoply of procedures andcontrols guaranteeing transparency andethics. This mechanism, put in place at thestart of 2020, is set to be applied to the entireGroup ecosystem. The Group has used itsrisk mapping to implement measures toreduce risk in its areas of weakness.

THE CODE OF BUSINESS 1.3.2.CONDUCT

Conduct, which lays down behaviours toadopt on a daily basis. This code of conduct,produced in collaboration with unions, isbased on the principles set out by the Sapin IIlaw on transparency, the fight againstcorruption and the modernisation of theeconomy. The principles enshrined in thisCode are intangible signposts set out toguide the actions of all Group employees.Employees must uphold its principles ofintegrity, respect, compliance, moralleadership, fairness and accountability. Therewill be a campaign in 2020 to raiseawareness amongst all the Group’semployees of the Code of Business Conduct,so that they can understand the importanceof its principles.

Econocom has set out to unite all of itsemployees in support of a Code of Business

WHISTLE BLOWING 1.3.3.MECHANISM

Econocom has rolled out, across the Group, amechanism for whistle blowing through anexternal provider, meeting the requirementsof the Sapin II law and other Europeanregulations. This mechanism is an externalinternet platform which any internal orexternal stakeholder has access to. Itguarantees the protection of whistle blowersand monitoring of how reports areprocessed.

RESPECT FOR HUMAN 1.3.4.RIGHTS

The Group operates for the most part inWestern European countries, where labourlaws and regulations are stricter thanrequired by human rights standards. TheGroup has defined its HR standards in linewith these regulations and applies them inall other countries where it is active.Econocom’s staff is essentially made up ofskilled personnel who expect humanresources practices to meet particularly highstandards.



For these reasons, the Group’s human rightsrisks for the most part involve its suppliersand sub-contractors. In keeping with itspurchasing practices, Econocom asks itstier-1 suppliers to comply with its own ethicaland labour standards. The Group alsorequires its suppliers to comply withinternational standards such as the UnitedNations Global Compact and InternationalLabour Organization fundamentalconventions.

RESPONSIBLE PURCHASING1.3.5.

Lasting cooperation between a company andits suppliers contributes to drivingperformance for all parties. In 2015,Econocom group decided to structure itsresponsible purchasing policy to establishtrust-based relationships with its suppliers byencouraging them to implement a CSRprogramme. As part of this policy, the Groupintroduced a supplier code of conduct basedon the ten principles of the United NationsGlobal Compact. This code of conduct issystematically sent to all Econocom suppliersto reinforce its responsible purchasing policy.

Tender offers for the top two categories ofpurchases (mainly outsourced services) nowfactor in supplier selection criteria (socialand/or environmental). Econocomchampions the idea that CSR should aboveall be based on dialogue with itsstakeholders and on pooling strengths andresources. That is how the Group and itsstakeholders can make the bestcontribution to sustainable development.

GENERAL DATA PROTECTION 1.3.6.REGULATION (GDPR)

The Econocom group is keen to protect theprivate life and data of its employees, clientsand partners and in this respect ensures therespect of the applicable personal dataprotection law, and in particular theEuropean law on General Data Protectionno. 2016/679 of 27 April 2016 (GDPR), as well asall the national laws enacted as aconsequence, and which may be applicable.

In order to ensure respect for theaforementioned regulation by theEconocom group and its entities, a certainnumber of measures have beenimplemented:

Appointment of a DPO at the Group level;•

Drawing up of an internal charter serving•as a framework for the processing of databy Group entities;

Informing co-workers of how their data is•used and raising their awareness about dataprotection regulation;

Updating the IT Charter in line with•regulations;

Drawing up of a confidentiality policy for•the Econocom group corporate site.

These measures are consistent with thesteps to make Econocom group comply withapplicable regulation, and they show thedaily commitment both by the Group and byeach Econocom group entity to aresponsible use of personal data.


03 corporate social responsibilitysupport the new responsible uses of our customers and users

Support the new responsible 2.uses of our customers and usersAware of the challenges related to the in digital transformation, the Group does notenvironmental impact of digital technology, seek to promote digital technologies just forthe Econocom group is innovating to the sake of digital technologies. Bystrengthen the green aspect of its offerings, proposing an approach aimed firstly ateven creating a specific business unit meeting the needs of users, it contributes todedicated to energy efficiency. As an expert the fight against digital waste.

Develop our offer of green and responsible 2.1.products and services

REINFORCE THE GREEN 2.1.1.AND RESPONSIBLE DIMENSION IN OUR NEW AND EXISTING OFFERS

Econocom wishes to natively boost theresponsible component in 100% of its newoffers as well as in its existing offers. The ideais to create new generation support offersfulfilling new uses (autonomy, userexperience, etc.) and the need for costcontrol requested by the DSI. Econocom istherefore trying to provide its clients withsolutions for transforming the workenvironment (physical and digital) andassociated infrastructure to increase usersatisfaction and productivity whilereconciling the responsible dimension in itsportfolio of offers.

DEVELOPMENT 2.1.2.OF THE GREEN & ENERGY BU

Companies and communities face identicalenvironmental challenges: limiting theircarbon footprint, reducing and sustainablycontrolling their energy consumption andsecuring their energy purchases.

proposing global solutions ranging fromsupport to the implementation andfinancing of energy performance projects forenhancing competitiveness and greengrowth of companies. These solutionsaccelerate the energy transition of ourcustomers by enabling them to identify theirpotential energy savings, prioritise theirenergy efficiency actions while self-financingall or part of these projects through energysavings and usage generated.

Through its Green & Energy Department,Econocom meets these challenges by

Smart Lighting, an example of a marketarea in the energy sector

Econocom’s financing business provides itscustomers with the option of rethinkingtheir lighting by introducing a smartlighting system. The Group’s financingsolution lets customers combine LED anddigital technology with an immediate returnon investment. The customer can optimiselighting in its buildings to reduce both costsand consumption. Furthermore, the smartlighting system improves visual comfort andenhances the well-being of buildingoccupants.


03corporate social responsibilityupport the new responsible uses of our customers and users

Watt’s Green, Responsible IT solutions andadvice, analyses energy consumption andsuggests concrete measures to optimiseenergy spending.

The objective of Watt’s Green is:

to estimate the energy consumption of•digital equipment;

to implement good practices plans;•

to measure the actions implemented to•reduce the environmental footprint.

Watt’s Green is a single centre of expertiseand four packaged services for managingresponsible IT energy projects:

Watt’s Green Flash: audit of the energy•consumption of Information Systemequipment;

Watt’s Green Dynamic: dynamic•management of users’ workstations;

Watt’s Green Datacentre: audit of the•energy consumption of the datacentre;

Watt’s Green CSR: supporting•communication and CSR strategy inResponsible IT.

Promote useful 2.2.and responsible digital business and the circular economyEconocom wants to offer effective andresponsible solutions to generate positiveimpact for its customers and their users,without promoting digital for digital at anycost. As part of this approach of socialresponsibility, the fight against digital wasteis one of the stakes that Econocom has setfor itself.

MARS, A BIG DATA OFFERING 2.2.1.TO BETTER UNDERSTAND DIGITAL USAGE WHILST IMPROVING EMPLOYEE SATISFACTION

Today, corporate employees are increasinglydemanding: they want to work with toolsthat provide an experience similar to the onethat they experience in the private sphere.The digital solutions and equipmentproposed by the Group Management mustbe adapted to employees’ digital uses, bethey confirmed or novice nomadic,sedentary digital users, while ensuringsatisfaction and a good allocation ofresources. This, according to Econocom isthe key to the success of digitaltransformation. To support decision-makersin this approach, Econocom developed theMarS (Master all Resources) offer.

MarS provides decision-makers with acockpit incorporating indicators on digitaluses of big data and improving theperformance of digital transformation. MarSproposes an indicator for the fight againstdigital waste, particularly on the resourceallocation dimension. This indicator is usedto identify the workstations and applicationsolutions actually used or not used, orunderused in the company. This real-timeidentification of dormant digital resourcesallows the company to conductinvestigations to determine the causes. Itcan thus quickly set up corrective measuresfor an effective policy to reallocateresources or for recycling. It also reducesthe risks in terms of GDPR while improvingits environmental impact. The advantage ofthese indicators is therefore twofold: inaddition to optimising the cost of theworkstation, they make it possible toimplement good practices in the fightagainst digital waste.


03 corporate social responsibilitysupport the new responsible uses of our customers and users

In 2018, the Econocom group deployed theMarS cockpit on its sites. The digital wasteprevention indicator allows companies toset targets for reducing costs, both forapplication-related subscriptions and forcomputer leasing costs. It saves around30 euros per year and per workstation,without affecting user comfort or work. Forlarge groups, the MarS offer helpssignificantly reduce costs on IT equipmentand applications

A STRONG COMMITMENT TO 2.2.2.RESPONSIBLE IT

Since November 2019, Econocom has been amember of the “Digital and Environment”working party managed by SyntecNumérique and bringing together severalcompanies in the sector who want todevelop in responsible IT issues. The aim ofthis working party is to share good practicein relation to responsible IT initiatives inmember companies, in order to improvehow the entire sector deals with theseissues. This project is designed to unitedigital players around three commitments:

to recognise that climate change is a•major issue for humanity, that ITcompanies have an impact and must takeaction ;

to mobilise in order to contribute, and their•level, to the COP21 target of limiting globalwarming to 2 degrees ;

to offer training in responsible and•ecologically efficient digital business.

TO BECOME A LEADER IN 2.2.3.THE FINANCING OF THE CIRCULAR ECONOMY

Econocom is convinced that digital businesscan no longer be an end in and of itself, butis a means towards the common good. Itmust be ethical by design – i.e., guided byvalues of respect for people and theirenvironment, to provide, from conception,solutions to the problems posed. It must beresponsible and sustainable, appropriate toeveryone’s uses, designed for the long termwith a view to an entire value chain. That isthe purpose of “tech for good”, which putsinnovation behind the common good.

For Econocom, usages are the key totransformation. Usages are, specifically, howwe live, consume and work. Thinking ofdigital transformation in terms of usageprovides the client with long-term solutionswhich respect people, the environment andsociety.

For over 40 years, Econocom has beensupporting companies in their industrialchanges, in particular by financing digitaland technological solutions and assets.Thanks to this core-business and itstechnological surveys, Econocom providescompanies and organisations with bespokedigital solutions, with contemporaryconsumer finance. By virtue of its “as aservice” business positioning, Econocomparticipates and acts specifically to meetchallenges of the circular economy.


03corporate social responsibilitysupport the new responsible uses of our customers and users

At present, 32 to 47%(1) of companies havealready adopted the circular approach tothe purchase, design, production andrecycling of products. However, only 12%(2)

of them adopt a business model which alsooffers products as a service. This lowproportion of businesses that havesucceeded in offering the “as a service”model is a seam of unexploitedopportunities.

Specifically, Econocom has essentialexpertise in the financing of digital projectsand technological assets via “as a service”financing solutions. Taking this conceptfurther, the Group has specific technologicalofferings to enable companies to managetheir digital projects in real time and closelyadjusted to usages. The Group is committedto actively contributing to this change ofmodel.

Use’n’pay is a payment by usage solution;•it is modular and capable of evolving,incorporating all components of digitalprojects according to the requirements ofthe company (payment by subscription,usage or license).

the MarS (Master of All Resources) offering•helps measure and understand the realdigital usages of employees in a company,in order to improve the performance of thedigital solutions deployed internally(optimisation of costs, preventing digitalwaste, improving user satisfaction) throughthe management of indicators measuringusage in real time, data analysis, and adviceon digital solutions.

Belgian companies, for two years nowEconocom Belux has been making itsactive contribution to circular solutionprojects in the country.

Econocom Belux is a signatory of the•“Green Deal”, a government initiativewhich aims to accelerate the switch to acircular economy. Alongside 229 other

Boost responsible 2.3.innovation in internal and external collaborations

LISTENING TO OUR 2.3.1.CUSTOMER’S NEEDS AND MEASURING THEIR SATISFACTION

Econocom is convinced that CSR alsomeans listening attentively to customers’needs: this is the conviction of Econocom.In 2018, Econocom launched an extensivesurvey programme for its customers as partof its “e for excellence” project.

This programme aims to support theGroup’s efforts towards excellence bylistening more closely to the needs of itscustomers and implementing a means tomeasure the level of their satisfaction.

A representative sample within eachbusiness and country was identified andsurveyed in order to highlight the keyexpectations of our customers.

These analyses were then shared with thebusinesses to bring out concrete solutionsto advance these results and thus ensure ahigh level of satisfaction.

Key figures of the programme in 2018:

150 employees involved in building and•implementing corrective action plans;

750 customers surveyed in five countries;•

more than 20 short- and long-term actions•implemented and 40 new actionsidentified across the Group.

Model of the World Business Council for Sustainable Development and the Boston Consulting Group. (1)See docs.wbcsd.org/2018/01/The_new_big_circle.pdfModel of the World Business Council for Sustainable Development and the Boston Consulting Group. (2)See docs.wbcsd.org/2018/01/The_new_big_circle.pdf


03 corporate social responsibilityfederate an ecosystem to create shared value

Federate an ecosystem 3.to create shared valueThe Econocom group believes in the positive With these convictions, the Group has madeimpact of digital technology on lifelong education one of the key pillars of its CSRlearning. The new teaching and collaboration strategy, as much through its partnershipsmodels introduced through digital and philanthropic actions as through supporttechnologies are important levers to create for the most innovative edtech start-ups.shared value and develop digital inclusion.

Partnerships in the education and university 3.1.sector

SUPPORT NEW USES LINKED 3.1.1.TO USEFUL DIGITAL BUSINESS IN THE EDUCATION SECTOR, AND GREEN IT

Econocom is committed to promotingdigital technology in school curricula inorder to fight the digital divide and improveaccessibility. The French government hasdecided to encourage the use of digitaltechnology in schools to make up forFrance’s lag in the area. Econocom wants totake action in this movement by providingschools with solutions adapted to the needsof students, teachers, parents and publicauthorities.

Econocom’s goal through its commitmentto education is to play a role in thetransformation of learning, to ingrain a loveof learning in students, to encourage newteaching practices and to promote parentalinvolvement in the education of children.

Two priorities have been set to encouragethe integration of digital technology ineducation:

equipment: the world is changing and•giving digital technology an increasinglyimportant role in people’s professional andpersonal lives. Students must therefore beprepared to face the challenges oftomorrow. Digital technology must“physically” enter the classroom so that allstudents can develop skills in using thisequipment;

support for teachers: this is a key point, as•it will allow teachers to develop newrelationships with their students based onthe digital solutions available to them.Econocom regularly organises meetingswith teachers to identify their needs andexpectations in order to bring the rightresponses .

In 2018, Econocom’s investments ineducation were extended to highereducation, through several activities:

the development of a “Campus” offer,•which includes, in particular, the “Green”offers of the Econocom group, well adaptedespecially to a number of renovation andnew campus opening projects, in Franceand abroad;

Econocom established a partnership•with “Campus Managers”. CampusManagers is the first French network ofFrench universities and collegescommitted to sustainable development.Econocom and Campus Managers sharecommon objectives: facilitate thedissemination and sharing of goodsustainable development practices, toolsand resources for campuses;


03corporate social responsibilityfederate an ecosystem to create shared value

Éducapital: finally, always with the aim of•supporting young innovative companiesthat aspire to reinvent education,Econocom was the first player to invest inEducapital, the leading European venturecapital fund dedicated to education andvocational training;

Econocom member of Impact IA: in order•to take part in the changes and debates onthese issues, Econocom has been amember of Impact Intelligence Artificiellesince 2018. Impact IA is a collective focusedon reflection and actions with playersinvolved in the area of artificial intelligence.The members share two main objectives:addressing the ethical and societalchallenges of AI and supporting innovativeand positive projects for the world oftomorrow. Econocom is a stakeholder in the“AI for Good” and Education action groups.

INVESTMENT IN 3.1.2.EDUCATIONAL START-UPS

Magic Makers, a start-up specialising indeveloping and leading coding andcreative programming workshops forchildren

Econocom has acquired a stake in the sharecapital of Magic Makers, a start-up foundedin 2014 to work with experts from theeducation and digital sectors. It offers threetypes of workshops: weekly workshops,holiday workshops and events workshops.Magic Makers has developed its ownmethod, which allows children starting atage 6 to learn coding concepts with trainedfacilitators and innovative tools. Today, morethan 1,000 eager children attend MagicMakers coding classes or holiday workshops.Note that Magic Makers introduced the IA inits teaching in 2019.

project supported by INRIA and a number ofpartners, and backed by the FrenchInvestment for the Future programmecoordinated by the Caisse des Dépôts etConsignations. Children of Econocomemployees are offered discounts for MagicMakers courses through the Group’s Shareengagement programme. A demonstrationworkshop has been held at Econocom’sregistered office, with the participation ofabout 15 children.

Magic Makers is also active in middle schoolswith initiatives designed to help strugglingstudents. Coding courses for educators areavailable, mainly through the Class’Code

Kartable, the first full, free learning andstudy platform

Three years ago, this start-up opened aplatform allowing users to consultprogrammes, courses and exercises spanningall years of secondary school, free of charge.The idea for Kartable came from a widelyshared observation that teenagers and youngadults spend more time in front of theirscreens (computers, tablets and smartphones)than with a book in hand. With that in mind,Kartable set out to break down the barrier ofthe school textbook by giving young people atool designed in an area they know and trust,digital technology.

SPONSORSHIP 3.1.3.PROGRAMMES IN EDUCATION

A solid partnership with “PasserellesNumériques”

Econocom has been a partner to PasserellesNumériques since 2007. This organisationhelps young people from underprivilegedbackgrounds in Cambodia, Vietnam and thePhilippines to receive training and find skilledemployment in the ICT sector. Since 2007,480 students have been supported by theGroup on the basis of promotions consistingof 50 students and for a period of two yearsper promotion. The partnership establishedwith Passerelles Numérique also works inskills sponsorship.



Joint action with Fondation CroissanceResponsable

Econocom works with the FondationCroissance Responsable in support of theProf en Entreprise programme. Offered tomiddle and secondary school teachers ingeneral and technological education, as wellas guidance counsellors, the Prof enEntreprise programme is coordinated by theFondation Croissance Responsable inpartnership with the French Ministry ofNational Education through the FrenchCentre for Studies and Research intoPartnerships with Companies and Industries(CERPEP). This programme aims to supportthe professional integration of young peopleinto the job market by improving teachers’knowledge about the reality of working at acompany and what jobs entail. Thisworkshop also serves as the starting point forpartnerships between the host company, theteacher and the school (e.g., a secondaryschool student does an internship, thecompany employee speaks to the class, thestudents visit the company, etc.). As part ofthis programme, Econocom regularly opensits doors to teachers so that they can learnmore about what it is like to work at acompany. Discussions are organised with thedifferent Group functions so that they canbetter understand the company and how itoperates.

Econocom, partner to Double Horizon

Since 2013, Econocom has been a partner ofthe Double Horizon association whichsupports the education of under-privilegedpeople in France and abroad. Since 1992Double Horizon has been offering otherhorizons:

to children from emerging countries who•often lack everything they need to learn,starting with a proper school, or, when thisexists, school supplies,

to children from France, who, in•under-privileged districts, do not alwayshave the resources, outside school, todiscover the town, culture, the world.

For over six years now Econocom has beensupporting the French activities of theassociation. Double Horizon has beenoperating since 2009 in two schools in the20th district (of the priority educationnetwork): the Davout school and the MaryseHilsz school. A survey at the Davout school, afew years ago, showed that the majority ofchildren from this school had never visitedParis, its sites or museums, even by the endof secondary school. These children oftenface social, and sometimes culturaldifficulties.

The Double Horizon projects aim to addressthis injustice by enabling children to accessculture and to try and nurture an enjoymentof studying. The project, which involves thecooperation of teachers in both schools, hasfour aims:

access to culture, getting about twenty•children to explore Paris and its heritage;

another kind of school, allowing children to•experience school and learning in generalas a pleasant and enriching activity and notas an obligation or a dead end;

access for parents, involving parents in the•trips in city of Paris;

open mindedness, starting mentoring with•students which will give them a positiveexperience of studying through discussion.



As part of this partnership, Econocom invitesprimary school children to its offices tointroduce them to the business world andthe digital solutions it provides for itscustomers. In January 2019, Econocom andMicrosoft allowed a dozen children followedby the association to discover technologiesand high-tech spaces. Immersed in the heartof this “immersive class” at the Microsoftoffices in Issy-les-Moulineaux, the childrenwere able to enjoy a connected space,designed to welcome CE1 to secondaryschool students, to prepare them to play apart in a society transformed by digitaltechnology.

Econocom and Digital Security sponsorthe first 100% female class oncyber-security at Wild Code School

Digital technology is unavoidable ineveryday life, and yet women are leavingdigital professions. Whilst they represented30% of staff in the 1980s, now the figurestands at 15%. The Wild Code School, inpartnership with Econocom, Digital Securityand the City of Paris, decided to open thefirst class of its new training oncyber-security to females only, in a bid tocheck the disparities between men andwomen in the digital professions. As part ofthis partnership, Econocom and DigitalSecurity finance grants to support womeninvolved in this training.

The Wild Code School is a network of 19schools in Europe which offer webdeveloper training. Founded in 2014, theschool currently offers its students twospecialities: web development and dataanalysis. It already has almost 1,500 formerpupils and has a post-study employmentrate of 87%.

addresses a key issue for the Group inrelation to the employability of women inthe digital professions.

Econocom and Digital Security, majorplayers in the digital sector, both want toattract and recruit talent in order to meetthe need for skills in the cyber-securitysector. The launch of this new trainingmeets a critical need on the part ofcompanies which are constantly facing newthreats. This 100% female class also

100% of the students in the first class of thistraining were women. Aware that the gapbetween men and women in cyber securityis increasing, the Wild Code School openedthis training to 15 women job-seekers, andthey started last December, theirprofessional training lasting three months.This was then followed by a four-monthinternship period in order to improve theiremployability and complete their training.Following this training, these women wereable to develop their skills, notably bylearning to audit an information system,carrying out an intrusion test, or respondingto an incident. These women will then beable to apply, depending on experience, forpositions as junior cyber security analyst,“pen tester”, ISSM assistant, or securitycorrespondent in companies.

Finally, in order to better support its class offemale students, the Wild Code School hasturned to the Circle of Women in CyberSecurity (CEFCYS), an association whoseobjective is to encourage and promote thepresence and leadership of women insectors related to information systemssecurity.

Espérances Banlieues

In September 2019, Econocom formed apartnership with Espérances Banlieues. TheGroup committed itself to supporting theactions of this organisation which createsnon-denominational schools in difficultdistricts. Espérances Banlieues is special inthat it combines, with the school syllabus,the transmission of cultural and humanisticreferences and the codes of our country sothat children can find their place in society,and grow with confidence and the desire tosucceed. Preference is given to tailorededucational methods which involve theparents, in order to support every child indiscovering their talent. There are now 17schools across France, welcoming about700 pupils. Econocom’s support essentially



involves encouraging access and thetraining of pupils in digital technologies,notably thanks to the joint action of MagicMakers.

“100 000 Entrepreneurs”

To build bridges between schools andbusinesses, and to pass on theentrepreneurial drive to young people,Econocom supports the action of theorganisation “100 000 Entrepreneurs”.“100 000 entrepreneurs” is a public-interestorganisation that arranges for entrepreneurvolunteers to speak at establishments, fromsecondary schools to university-levelinstitutions. Led in close collaboration withthe French Ministry of National Educationand its academic representatives, these talksaim to raise students’ awareness aboutentrepreneurship, provide them withconcrete knowledge about the businessworld and show them the importance ofsubjects in their curriculum. More than1,000 students have attended these talkssince the beginning of our partnership.

Econocom, a founding member of the Femmes@Numérique foundation

To reverse the trend and encourage paritywithin digital channels, Econocom is oneof the founding members of theFemmes@Numérique foundation created in2018. The purpose of this foundation is tofinance the actions undertaken by theFemmes@Numérique collective body toenable them to move to the necessary scalethroughout the country and to massivelyraise awareness among the general andprivate public organisations, publicauthorities, players in the area of training andeducation.

Become the partner 3.2.of choice for innovative companies and integrate them into our offersSupporting and growing start-ups is one ofthe major lines of the Econocom CSR policy.It is also one of the ways of embodying andexpressing the three group values: audacity,responsiveness and good faith.

The start-up spirit at the heart ofEconocom’s organisation, with its“Satellite” SMEs

Econocom group has put in place an originalintegration and governance model for someof these new acquisitions (called “Satellites”)so as to preserve their agility, boost theirperformance and competitiveness andgenerate synergies at Group level. Thefounding shareholders of these Satelliteshave retained a non-controlling interest inthe share capital and have a very broad levelof managerial autonomy.

The Prix des Technologies Numériques

For the past three years, Econocom haspartnered with Prix des TechnologiesNumériques, a digital technologyorganisation, driven by Télécom Paristech,made up of more than 300 leaders anddecision-makers. For the 2019 awards,the panel of the Prix des TechnologiesNumériques, including Véroniquedi Benedetto and other recognised figuresfrom the digital industry, focused onFintechs, thus giving some limelight to theentrepreneurs who have used their talentand creativity to invent new solutions inthis area.



French entrepreneurship with Partech

Since joining the seed fund “PartechEntrepreneur” in October 2013, Econocomhas furthered its collaboration with the fundto support the development of digitalentrepreneurship in France. Open innovationhas become a necessary component tosupport traditional R&D efforts of largecompanies, while start-ups need to be incontact with large companies to acceleratetheir business. As a Corporate InnovationPartner for the fifth year running, among itsother roles in this capacity, Econocom leadsan annual calendar of business events oninnovation with other organisations involvedin Partech.

Paris-Saclay Fund

Econocom has also invested in theParis-Saclay Seed fund, which seeks tosupport and promote innovation andentrepreneurship within the IT, Internet,digital and life sciences, and MedTechsectors. This new investment givesEconocom a lasting innovative edge indigital technology and changes in society tocontinue offering its customers the bestsolutions. Nearly 50 young, high-potentialcompanies will benefit from support overthe next three years. This position providesdirect contact with tomorrow’s talent thatcould one day be part of Econocom group.

Develop our local 3.3.roots

its direct ecosystem in order to put downfirm local roots.

Econocom intends to make a positiveimpact on all of its ecosystem. One of thepriorities which the Group set itself is tobuild lasting relationships with theeconomic, social and community fabricclose to the sites where the Group is active.Every site and subsidiary is thereforeencouraged to get positively involved with

Overview of initiatives with positiveimpact in our subsidiaries:

Italy:

During the Christmas festivities, EconocomItaly rolled out an original, meaningfulinitiative with its co-workers.Acknowledging that there are thousands ofchildren in Milan waiting for medical care,the Italian subsidiary of Econocom thoughtup a partnership with the “Medici inFamiglia” medical centre in Milan whichoffers medical visits, check-ups andspecialist therapies at affordable prices. Theidea was to suggest that employees make a“care” Christmas tree with each baublerepresenting a particular kind of careprovision which Econocom would pay for. Allthe employees were thus able to contributedirectly by choosing the Christmas ball oftheir choice corresponding to the medicalvisit to be gifted.

Belux:

In April 2019, Econocom Belux was alogistical partner of the 31st edition of theTélévie. The Télévie is a charitable eventwhich raises funds for F.R.S.-FNRS and whichhas been taking place in French-speakingBelgium and Luxembourg since 1989. It isorganised by RTL-TVI. It raises funds forscientific research in the fight against cancerand leukaemia, in both children and adults.About ten employees volunteered andinstalled over 200 laptops, used to code thedonations.

As part of its quality of life in the workplaceprogramme, Econocom Belux has recentlymade an electric bicycle available to itsemployees, to encourage them to use thismethod of transport for their localcommutes.



United Kingdom: mid-November onwards in preparation forthe Christmas period.In December 2018, Econocom UK

suggested to its employees that, instead ofthe traditional Secret Santa, they shouldmake donations to charities in the city ofBirmingham. Econocom UK thussupported two of the charities of theBirmingham City Mission. One of them is aresource centre which distributes food,clothes and furniture to the needy. Thecharitable organisation distributes over 200food parcels per month to people indifficulty. The charity has also givenpresents to about 3,000 children in the city.Econocom employees thus collected food,toys, household items and clothes from

In 2018, Econocom UK donated its surplusof surgical masks (over 8,000) to OperationSunshine, a charity based in the UnitedKingdom and which works withcommunities in Africa. The charity works onreducing poverty and difficulties indeveloping communities in Africa (Zambia,Zimbabwe and Lesotho). It supports clinics,hospitals and schools by providing goodstime and knowledge. The surgical maskswere given to rural hospitals and clinics,and also to schools and learning centres.


04risk factors

Operational risks1. 98

Risks associated with Services 1.1.contracts 98Risk of sub-contractor default1.2. 98Risks associated with price 1.3.fluctuations and hardware obsolescence 99Risks associated with competition1.4. 99Employee-related risks1.5. 99Environmental risks1.6. 99Insurance against risk1.7. 99Pledges, guarantees, collateral 1.8.provided and borrowings 100Risks related to external growth1.9. 100

Regulatory risk2. 101

Legal risks2.1. 101Risks associated with tax 2.2.inspections 101Risks associated with regulations 2.3.applicable to lessors’ leasing business 101Risks associated with regulations 2.4.applicable to Technology Management & Financing clients 101

Dependency risk3. 102

Dependence on refinancing 3.1.institutions 102Customer dependency risk3.2. 102Supplier dependency risk3.3. 102Technology dependency risk3.4. 102

Financial risk4. 103

Market risk4.1. 103Credit and counterparty risk4.2. 104Equity risk4.3. 105


04 risk factorsoperational risks

Operational risks1.Risks associated with 1.1.

Services contractsThe Group offers three types of Servicescontracts:

fixed-price contracts with a guaranteed•result, whereby the Group undertakes toprovide certain deliverables for a fixedprice, irrespective of the timeframe. Thistype of contract may include financialpenalties in the event of below-expectationperformance, calculated according to thevalue of the contract and usually capped ata certain percentage of the annual amountof the contract. Econocom manages thisrisk by carrying out technical and financialmonitoring of projects (measuring theachievement of contractual objectives,tracking the number of man-days used,estimating the remaining consultant timerequired, and measuring service qualityand lead-time indicators, etc.). Thismonitoring enables the Group to measureand oversee the achievement ofcontractual obligations and, whereapplicable, anticipate any provisions forlosses upon contract completion to berecognised in the financial statements.Contracts with a guaranteed resultaccount for almost one-half of the Servicesbusiness in terms of value;

fixed-price contracts with service level•agreements, whereby the Groupundertakes to provide a given service,within a given timeframe, for a fixed priceper time unit (usually per month).Econocom manages this risk by carryingout regular technical and financialmonitoring of the projects, particularly bytracking the number of man-days spent;

time-and-materials contracts, whereby the•Group undertakes to provide technicalskills and charges the client for the numberof labour hours spent; Econocom managesthese contracts by paying particularattention to the fee schedule and itsconsultants’ fees.

Furthermore, Services contracts carry risksassociated with termination notice periods.The Group ensures that this period allowssufficient lead time to adjust the workforce,particularly on large contracts. The Groupplans in advance for contract terminationsso that it may redeploy its staff and uses ameasured level of sub-contracting toensure flexibility.

Risk of 1.2.sub-contractor defaultFor certain contracts, Econocom hasperformance obligations and sometimescalls upon the services of sub-contractors.Econocom’s policy is to recover anypenalties charged from its sub-contractors.However, it is possible that Econocom mayincur a risk related to default by one of itssub-contractors No single sub-contractor issufficiently important to account for asignificant portion of Econocom’s business.

Econocom assesses the financial andoperational capacities of its sub-contractorsas and when required, and in particularwhen it uses sub-contractors that are newmarket entrants.


04risk factorsoperational risks

Risks associated with 1.3.price fluctuations and hardware obsolescenceThe Group is exposed to the risk offluctuations in the future value of leasedequipment within the scope of itsTechnology Management & Financingbusiness. It deals with this risk bycalculating the future value of equipmentusing the diminishing balance method.This calculation method is described innote 4.1 on accounting principles to theconsolidated financial statements. Themethod is regularly compared with actualtransactions, and annual statistics arecompiled to validate the suitable andprudent nature of the selected method.

For non-standard equipment, the Groupensures that the future value of leasedequipment is estimated appropriately,namely by calling on independent experts.

For its Products & Solutions business,Econocom does not keep substantialsurplus stock and as such limits itsexposure to the risk of obsolescence.

For its data centre maintenance andoutsourcing activity, the Group keepsdedicated stock. The components andlevels of stock are constantly monitored toensure that they are in line with the volumeand type of equipment undermaintenance, which addresses the risk ofobsolescence.

Risks associated with 1.4.competitionThe ICT services market is competitive. Ineach country where it has operations andin each of its businesses, the Group facescompetition from international, national orlocal players. However, Econocom standsout from the competition due to thediversity of its activities and, especially, itsexpertise in Technology Management &Financing and the international scope of itsactivities.

Employee-related 1.5.risksAs far as Econocom group Management isaware, the Group is not exposed to anyemployee-related risks other than thosearising in the normal course of business forcompanies of a comparable size based inEurope. The majority of the workforce isemployed in the Group’s French, Belgian,Spanish, Italian, Moroccan and Braziliansubsidiaries.

Environmental risks1.6.Econocom group does not destroy themachines purchased from refinancinginstitutions at the term of the related leases.In accordance with the WEEE (WasteElectrical and Electronic Equipment)Directive, the Group collects all theequipment it owns from clients andarranges for all electrical and electronicwaste to be processed and recycled. Since2013, Econocom has been a client ofEcologic, an environmental organisationwhich collects and processes WEEE frombusinesses all over France, in compliancewith environmental legislation.

Insurance against 1.7.riskThe Group is covered against liability claimsand property damage via insurancepolicies taken out with first-rate insurers. Ithas elected not to take out businessinterruption insurance and insuranceagainst risk of fraud.

The Group reviews and evaluates its riskson an ongoing basis in conjunction with itsinsurers and experts so as to ensureoptimal coverage in both the insuranceand reinsurance markets.


04 risk factorsoperational risks

Pledges, guarantees, 1.8.collateral provided and borrowingsReal security interests provided as collateralfor borrowings or financial liabilities by theGroup chiefly consist of receivables offeredas collateral for its short-term funding. Theamount of pledged and mortgaged assetsis disclosed in note 20 to the consolidatedfinancial statements.

Risks related to 1.9.external growthAs part of its strategy, the Group continuesto develop its business by seeking targetedacquisition opportunities.

Acquiring and integrating companies givesrise to certain risks, includinghigher-than-anticipated financial andoperating expenses, failure of theoperational integration, which can lead toloss of major clients or the departure ofimportant members of the acquiree’s staffand a decline in financial performance.

Integration of the acquired companies mayalso disrupt the Group’s existing businessesand lead to insufficient resources,particularly in terms of management. Thesynergies expected from an acquisitionmay fall short of forecasts or take longer toachieve than initially announced, and thecosts of implementing these synergies mayexceed expectations. The above-mentionedfactors may also have a negative impact onthe goodwill recognised in theconsolidated financial statements (see alsonote 9 “Goodwill and impairment testing”to the consolidated financial statements).

Several years ago, Econocom group put inplace an original integration and governancemodel for some of these new acquisitions(called “satellites”) so as to preserve theiragility, boost their performance andcompetitiveness and generate synergies atGroup level. The founding shareholders ofthese satellites have retained anon-controlling interest in the share capitaland have a very broad level of managerialautonomy. The related integration risk ismitigated by the fact that taken individually,these transactions are relatively small.


04risk factorsregulatory risk

Regulatory risk2.Legal risks2.1.

The Group operates as a service provider invarious Western European countries and istherefore subject to numerous different lawsas well as customs, tax and labour regulations.In order to limit its exposure to legal risks, theGroup has set up subsidiaries in each countryrun by managers who are familiar with theapplicable local laws and regulations, whowork alongside the Group’s Legal Counselsand external consultants.

Econocom monitors on an ongoing basis anylitigation and one-off situations that couldresult in a financial risk. Any pending litigationis covered by provisions for appropriateamounts calculated by Group Management.

Disclosures concerning litigation or arbitrationlikely to have a substantial impact onEconocom group’s financial position, assets,business or the results of its operations at31 December 2018, are presented in note 16 tothe consolidated financial statements.

Risks associated with 2.2.tax inspectionsThe Group undergoes regular tax inspectionsin the various countries in which it operates.Although the outcome of these inspections isuncertain, the Group has estimated asaccurately as possible the associated risks andhas recognised the appropriate provisions forthose risks in its financial statements. Theoutcome of these inspections could have anegative impact on the Group’s consolidatedfinancial statements. However, this impact islimited on account of the provisionsrecognised.

Risks associated with 2.3.regulations applicable to lessors’ leasing business

legislation governing financial institutions.The associated risk, which is common to allcompanies in the industry, concerns theincrease in administrative costs.

Certain countries have decoded toimplement stricter legislation for leasingcompanies by aligning it with the

Risks associated with 2.4.regulations applicable to Technology Management & Financing clientsThe new IFRS standard applicable to leaseagreements, IFRS 16, published inJanuary 2016, entered into force on 1 January2019. Under this new accounting standard,“lease liabilities” are presented on theCompany’s statement of financial positionunder liabilities, with the exception of smallitems with an insignificant unit value.

As anticipated, the impact of this newstandard for the Technology Management &Financing business was limited due to theadded value brought by the Group in itsleases:

upgrade management via leasing and in•particular the Group’s scalable offerings;

asset management and expense•management provided by Econocom’ssolutions (inventory tracking, telephoneusage management, IT outsourcing for smalland medium businesses, etc.), which give ourclients optimal visibility and more effectivemanagement of their assets;

better economic management of•end-of-life assets;

management of end-of-life assets in greater•compliance with sustainable developmentcommitments;

smart and connected object (IoT)•management capabilities.


04 risk factorsdependency risk

Dependency risk3.Dependence on 3.1.

refinancing institutionsIn the course of its business, Econocomassigns most of its finance lease contractsto refinancing institutions.

These institutions generally focus onclearly-defined geographical areas or typesof equipment. In addition, the Group strivesto maintain a balanced portfolio ofinstitutions in order to avoid beingoverdependent on one or more institutions.

Between 2018 and 2019, the proportion ofthe Group’s five biggest funders was downyear-on-year, accounting for 58% of thetotal value of refinanced rents in 2019. TheGroup’s main funder in 2019 representedapproximately one-quarter of the totalvalue of refinanced rents.

Customer 3.2.dependency riskThe Group continually strives to expand itsclient portfolio. This is a strategicdevelopment focus area aimed at gainingmarket shares. At 31 December 2019, nosingle client represented over 5% of theGroup’s consolidated revenue.

Supplier dependency 3.3.riskGiven the broad choice of potentialsuppliers and the fact that they are largelyinterchangeable, Econocom’s dependenceon suppliers is very limited.

For the Technology Management& Financing, Products & Solutions andServices activities, the choice of suppliers isultimately made by our clients. For theseactivities, in the event of a supplier default,an alternative supplier is chosen.

At 31 December 2019, no supplieraccounted for more than 15% of the Group’stotal purchases.

Technology 3.4.dependency riskFor its Technology Management &Financing, Services and Products &Solutions activities, the Group developspartnerships with hardware manufacturers,telecoms operators, software vendors andsolutions providers. However, it strives toremain independent from thesecompanies in order to offer the bestpossible solution in terms of architecture,hardware and software.


04risk factorsfinancial risk

Financial risk4.The Group’s activities are subject to certainfinancial risks: market risk (includingcurrency risk, interest rate risk and pricerisk), liquidity risk and credit risk.

The Group’s overall financial riskmanagement policy focuses on reducingexposure to credit risk and interest rate riskby transferring finance lease receivables torefinancing institutions and by usingfactoring solutions on a non-recourse basisin the Services and Products & Solutionsbusinesses.

Market risk4.1.Financial market risks (interest rate andcurrency risk) and liquidity risks arehandled by Group Management.

CURRENCY RISK4.1.1.

exposure is limited. Econocom group doesnot deem this risk to be material, but hasnevertheless signed a number of foreignexchange hedging agreements to hedgerisks on internal flows.

The Group operates chiefly in the eurozone;however, following the expansion ofoperations in non-eurozone countries inEurope, as well as North and South America,the Group may be exposed to currency riskon other currencies. The currenciesconcerned are the pound sterling, the USand Canadian dollars, the Moroccan dirham,the Czech crown, the Swiss franc, the newRomanian leu, the Polish zloty, the Brazilianreal and the Mexican peso. Since the largemajority of subsidiaries’ purchases and salesare denominated in the same currency, this

INTEREST RATE RISK4.1.2.

Econocom’s operating income and cashflows are substantially independent ofchanges in interest rates. Sales of leases torefinancing institutions are systematicallybased on fixed rates. Income arising onthese contracts is therefore set at theoutset and only varies if the contract isamended.

The Group uses a combination of fixedrates and floating rates to hedge its interestrate exposure.

At 31 December 2019, the Group’sfloating-rate debt comprises short-termborrowings (credit lines, commercial paperand bridge loans), and short-term factoringagreements. Partial hedges were in place asof 31 December 2019 on these floating-rateborrowings.

The Group’s long-term debt is at fixed ratesand comprises a euro private placement(Euro PP) for €102 million and a €150 millionSchuldschein bond and a €189 million bondinvestment. Rate hedges are in place for thefloating-rate portion.


04 risk factorsfinancial risk

LIQUIDITY RISK4.1.3.

The Finance Department is responsible forensuring that the Group has a constantflow of sufficient funding:

by analysing and updating cash flow•forecasts on a monthly basis for all of theGroup's companies;

by negotiating and maintaining sufficient•outstanding lines of financing;

by optimising the Group’s cash pooling•system in order to offset cash surplusesand internal cash requirements.

In 2019, Econocom continued to optimiseits diversified sources of financing with theaim of (i) reducing borrowing costs, (ii)extending the maturities of its borrowingsand (iii) bank disintermediation.

In order to meet its short-term financingrequirements, the Group now has newbank credit facilities with longer maturities.The Group mainly uses its commercialpaper programme, capped at €450 millionand with maturities of up to two years, ofwhich €279 million was outstanding at31 December 2019.

At that date, Econocom had €263 million inbilateral bank credit facilities of which€150 million committed.

Econocom also has €110 million in bilateralbank loans to finance its leases at rates thatremain fixed for the duration of the loans.

To finance its development, Econocomissued:

down into two tranches: €45.5 millionmaturing at five years and paying interestat 2.364%, and €55.5 million maturing atseven years and paying interest of 2.804%;

in May 2015, a private placement on the•Alternext market for €101 million, broken

in December 2016, a Schuldschein bond•(German private placement) for a totalamount of €150 million, with tranchesmaturing at five and seven years andpaying interest at an average rate of 1.54%;

in March 2018, the Group issued bonds•convertible into new shares and/orexchangeable for existing shares (OCEANE).The issue was for a total of €200 million,maturing in 2023.

The Group intends to continue its policy ofdiversifying its sources of financing in orderto optimise its borrowing costs and furtherreinforce its financial independence.

In addition to redeeming/renewingcommercial paper, €45.5 million for theEuroPP will mature in 2020.

Credit and 4.2.counterparty riskThe Group has policies in place to ensurethat goods and services are sold to clientswhose credit standing has been analysed indepth. The Group’s credit risk exposure isalso limited as it does not have anyconcentration of credit risk and usesfactoring solutions for the Products &Solutions and Services businesses, as well asnon-recourse refinancing with banksubsidiaries and credit insurance in theTechnology Management & Financingbusiness.


04risk factorsfinancial risk

For its Technology Management &Financing business, the Group neverthelesshas the option of retaining the credit risk oncertain strategic transactions. These relateprimarily to Econocom Digital FinanceLimited (EDFL), the Group’s internalrefinancing unit with expertise intransaction security and non-standardcontract financing.

At 31 December 2019, contracts on whichEconocom bears the credit risk represented€235 million, or around 7.8% of totaloutstanding rentals for the TechnologyManagement & Financing business(€246 million at end-2018).

The Group only invests withinvestment-grade counterparties, thuslimiting its credit risk exposure.

Equity risk4.3.The Group does not hold any unlisted orlisted shares apart from treasury shares.

As the treasury shares held by Econocomgroup as of 31 December 2019 are deductedfrom shareholders’ equity in theconsolidated financial statements as of theiracquisition, it is not necessary to comparetheir carrying amount to their actualmarket value.

04 risk factors



05management report

Group's financial position 1.and highlights 108

Changes in the scope for the year1.1. 109Principal investments1.2. 110Financing transactions1.3. 110Research1.4. 110

Profit for the year2. 111

Income statement2.1. 111Statement of financial position2.2. 116Parent company 2019 financial 2.3.statements of Econocom group SE 120

Risk factors and disputes3. 124

Outlook for 2020 and 4.shareholders' compensation 124

Corporate governance statement5. 125

Applicable corporate governance 5.1.code 125Exemptions from the 2009 Code5.2. 125Description des caractéristiques 5.3.de contrôle interne et de gestion des risques 127Ownership structure and limits on 5.4.shareholder rights 129The composition and functioning 5.5.of the administrative bodies and Committees 129Composition of advisory bodies5.6. 1362019 Compensation report5.7. 136Appropriation of profit 5.8.and dividend policy 142Relations with major shareholders5.9. 142Mention des schémas 5.10.d’intéressement du personnel 142Statutory auditor's fees5.11. 145Treasury shares5.12. 145

Subsequent events6. 146


05 management reportmanagement report of the board of directors on the financial statements

Management Report of the Board of Directors on the financial statementsfor the year ended 31 December 2019 presented to the Annual General Meeting of19 May 2020

In accordance with prevailing legislation and the Company’s Bylaws, we submit to you forapproval our report on the Company’s operations and the financial statements for the yearended 31 December 2019, as well as the compensation report.

The definitions of the performance indicators are provided as an appendix to this reportwhen they differ from the commonly accepted definitions.

The non-financial information required under articles 3 section 6 and 3 section 34 of theBelgian Companies Code (Code des sociétés) is reiterated in chapter 3, “Corporate SocialResponsibility”.

Group's financial position 1.and highlightsIn 2019 the Econocom group posted revenueof €2,927 million from continuing operations,identical, at constant standards to 2018revenue in terms of organic growth, therewas a slight decline of 0.8% compared to theprevious year. Restated for the drop inrevenue of Technology Management &Financing (TMF) in Italy, growth amounted to4.5% (of which 3.7% organic growth).

Revenue from the TMF business totalled€1,124 million with a 10% decline due mainlyto the contraction of the business of its Italiansubsidiary amounting to almost €130 millionon a full year basis. Excluding this impact,TMF revenue rose by 0.6% thanks to theperformance of the other regions (mainlyFrance, Belgium, Spain and the UnitedKingdom).

secondary schools or main local authorities,for example. Lastly the Group benefited fromthe fine performance of the “services” entities,which posted a 2.9% increase in revenue, up€670 million, driven mainly by digitaltechnologies.

The Digital Services and Solutions business(DSS, comprising Products and Solutions andServices) stood at €1,802 million, an increaseof 7.4%, including 6.2% in organic growth. Thissharp increase was driven by the distributionof “products and solutions”, with a revenueincrease of more than 10% (to €1,132 million),with major projects in digital equipment for

In 2019, revenue from discontinuedoperations amounted to €161 million. As partof its effort to refocus its business activities, inthe fourth quarter the Group slightlyexpanded the scope of application of IFRS 5by adding five small entities to bediscontinued.

The Profit from Continuing Operations (1)

amounted to €126.2 million despite thedecreased contribution by TMF Italycompared with 2018. To achieve this result, inthe second half the Group stepped up itscost-cutting plan, leading to gross savings ofaround €30 million for the entire Group(compared with the €20 million initiallyannounced) which, combined with thepositive business trend throughout the year,resulted in a significant increase in ROC over2018 (more than 13%).

Before amortisation of intangible assets from acquisitions.(1)


05management reportroup's financial position and highlights

The Group's net financial debt was€252.2 million as at 31 December 2019, equalto the figure at year-end 2018 (€251.7 million).The Net Debt to EBITDA ratio was 1.4 versus1.6 last year. This net financial debt includes€238.5 million in self-driven TMF contracts.

On the one hand, this change reflects soundoperating cash flow generation, the cashinflows received from the partial sale ofRayonnance in December, as well as thedecline working capital requirements forEDFL and, on the other hand, the cashoutflows in the year related to the acquisitionof non-controlling interests in Satellites, tothe redemption of the issue premium and toshare buybacks.

2019 was also shaped by several importantevents:

starting in January, the Group's Executive•Committee was expanded with theincorporation of the Executives of the majoroperating entities. As at 31 December, it iscomposed of the following members:Jean-Louis Bouchard, Bruno Grossi, AngelBenguigui, Laurent Roudil, Eric Bazile,Laurent Caparros, Chantal De Vrieze,Philippe Goullioud, and Eric Lucas;

on 25 June 2019, the Group Management•was notified that the Italian authorities wereconducting an investigation into possiblefraudulent activities that allegedly targetedEconocom in Italy. The Company is activelycooperating with the local authorities. Inaddition, steps were taken immediately toprotect the interests of the Group'scompanies, their customers and theiremployees, namely:

all the persons allegedly involved have▶been suspended from their positionsat Econocom in Italy,

a new management team has been▶appointed,

all relationships with any third parties▶potentially involved in the matterhave been terminated.

as announced at the beginning of the•year, the Group has initiated a majortransformation plan calling for Econocomto strengthen its legacy profession, TMF,refocusing on high-potential activities inits Digital Services & Solutions division andclosing subsidiaries deemed sub-criticaland disposing of some businessoperations. It also involves a major plan tomake its processes and cost-cutting drivesmore efficient;

the Group also redeemed the issue•premium in the amount of €0.12 pershare, identical to that of the previousyear, paid to shareholders on 31 July 2019.

Changes in the scope 1.1.for the year

DISPOSALS1.1.1.

In connection with the implementation ofits transformation plan, Econocom carriedout two disposal transactions during theyear:

Jade: in July 2019, Econocom sold to themanagers of the company the 85% held inJade Solutions, a company established inthe United Kingdom specialising in “crowdwi-fi” and professional mobility solutions formajor companies, particularly in the Retailand Logistics fields.

Rayonnance: in December 2019, Econocomsold to Apax Partners Development amajority share in its satellite but continuesto hold part of the capital. The conclusion ofa business and marketing partnershipagreement at the time of the sale is aimedat extending the relationship developedover the past few years. In particular,Rayonnance will continue to rely onfinancing and distribution offers for digitalsolutions of Econocom group.


05 management reportgroup's financial position and highlights

CHANGES IN OWNERSHIP 1.1.2.INTEREST

Synertrade: the Group through itssubsidiary Digital Dimension, acquired theminority stake (10%) in July 2019, thus raisingits stake to 100%.

Gigigo: Econocom group SE acquired allthe non-controlling interests (30%) inJuly 2019.

Infeeny: during the first half, Econocomgroup SE acquired 9.66% of the company'scapital.

JTRS: Econocom group increased its stakein the company through the acquisition ofshares from a minority shareholder (5%).JTRS remains consolidated under theequity method.

Altabox: at end-2019 the Group exercisedpart of its options on 15% of the company'scapital, raising its interest to 85%.

Alterway: the Group acquired the equityinterest of a minority shareholder,increasing the percentage of its ownershipinterest from 3.01% to 64.45%.

Principal investments1.2.In addition of the equity interests acquiredas described above, the main investmentsmade by the Group in 2019 in order toconsolidate and transform its operationswere related to creating new offers andrecruiting for key positions and renewingteams.

Financing 1.3.transactions

SHARE BUYBACKS1.3.1.

Econocom also continued to buy back itsown shares in 2019. It acquired10,209,425 treasury shares. After taking intoaccount disposals and transfers of shares tomanagers with share-ownership plans, as at31 December 2019 the Group held23,458,144 shares or 9.56% of the Company'scapital.

These transactions reflect the Group'scommitment to limiting dilution for itsshareholders and its confidence in itsgrowth outlook going forward.

Research1.4.In 2019, R&D efforts were continued,consistent with the areas developed in prioryears with the aim of providing intensivesupport and assistance for any innovativesolutions produced by our customers. R&Defforts focused particularly on the areas ofdata visualisation (DATAVIZ), decisionsupport, developing integrated solutions inthe area of IoT, image recognition in realtime, 5G microservice billing and machinelearning, applied to process automation.


05management reportprofit for the year

Profit for the year2.Income statement2.1.

in € millions 2019 2018Restated(1) Change

Revenue 2,926.6 2,999.0 (2.4%)

Technology Management & Financing (TMF) 1,124.2 1,321.1 (14.9%)

Digital Services & Solutions 1,802.4 1,677.9 7.4%

Profit (loss) from continuing operations(2) 126.2 110.9 13.8%

Profit (loss) from continuing operations 124.2 106.7 16.3%

Other non-recurring operating income and expenses (24.8) (19.9) 24.3%

Operating profit 99.4 86.8 14.5%

Other financial income and expenses (19.2) (15.5) 23.7%

Profit before tax 80.2 71.2 12.5%

Income tax expense (22.3) (20.8) 7.1%

Profit from continuing operations 57.9 50.4 14.8

Profit (loss) from discontinued operations (9.2) (5.9) 58.1%

Profit for the period 48.6 44.6 9.1%

Non-controlling interests 3.9 5.2 (24.6%)

Profit for the period attributable to owners of the parent 44.7 39.4 13.5%

Recurring net profit attributable to owners of the parent(2) 72.1 62.4 15.5%

The 2018 income statements are restated for the following changes in method:(1)

income and expenses of operations considered discontinued at 31/12/19 are restated to "profit or loss of•discontinued operations" in both the 2018 and 2019 income statements;revenue is based on our new interpretation of IFRS 15 for 2018 and 2019 direct deliveries (excl. licences); •however, in accordance with the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is•not restated for the impact of this regulation on leases.

Recurring operating profit before amortisation of intangible assets from acquisitions/Recurring profit attributable(2)

to owners of the parent: to facilitate the monitoring and comparability of its operating and financialperformances, Econocom Group presents two key indicators, “recurring operating profit before amortisation ofintangible assets from acquisitions” and “recurring profit attributable to owners of the parent”. Their definition isgiven in the notes to the financial statements.


05 management reportprofit for the year

Reconciliation of reported profit with recurring profit

in € millions 2019reported

Amortisationof

intangibleassets fromacquisitions

Othernon-

currentitems(1)

Profit(loss)from

discon-tinued

ope-rationssuivies

2019recurring(1)

2018restated(1)

recurring

Revenue 2,926.6 2,926.6 2,999.0

Profit (loss) from continuing operations 124,2 2,0 - 126.2 110.9

Other non-recurring operating income and expenses

(24.8) 24.8 - -

Operating profit 99.4 2.0 24.8 - 126.2 110.9Other financial income and expenses (19.2) (19.2) (15.5)

Profit before tax 80.2 2.0 24.8 - 106.9 95.4

Income tax expense (22.3) (0.7) (7.4) (30.4) (27.7)

Profit (loss) from discontinued operations (9.2) 9.2 - -

Share of profit (loss) of associates and joint ventures

- - -

Profit for the period 48.6 1.3 17.3 9.2 76.6 67.7

Non-controlling interests 3.9 0.5 4.4 5.2

Profit for the period attributable to owners of the parent

44.7 1.3 16.9 9.2 72.1 62.4

The 2018 income statements are restated for the following changes in method:(1)

income and expenses of operations considered discontinued at 31/12/19 are restated to "profit or loss of•discontinued operations" in both the 2018 and 2019 income statements; revenue is based on our new interpretation of IFRS 15 for 2018 and 2019 direct deliveries (excl. licences);•however, in accordance with the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is•not restated for the impact of this regulation on leases.



Net earnings per share attributable to owners of the parent

in € 2019 2018 Change

Earnings per share 0.20 0.17 17.1%

Basic earnings per share from continuing operations 0.24 0.19 23.0%

Basic earnings per share from discontinued operations (0.04) (0.02) 63.0%

Dilutes earnings per share 0.19 0.16 15.5%

Diluted earnings per share from continued operations 0.23 0.19 21.0%

Diluted earnings per share from discontinued operations (0.04) (0.02) 60.1%

RECURRING EARNINGS PER SHARE 0.32 0.27 19.1%

Number of shares outstanding

2019 2018

Average number of outstanding shares(1) 227,816,144 234,888,774

Total number of shares at year-end 245,380,430 245,140,430

Number of shares outstanding at year-end(1) 221,922,286 231,161,799

Econocom share price at 31 December (in €) 2.43 2.91

Market capitalisation at 31 December (in € millions) 597 713

Excl. treasury shares.(1)

Comments on the Group’s key figures

In 2019 the Econocom group postedconsolidated revenue of €2,927 millioncompared with €2,999 million in 2018. On alike-for-like basis, organic revenue fell by-0.8%.

Profit (loss) from continuing operationsbefore amortisation of intangible assets fromacquisitions was €126.2 million, comparedwith €110.9 million in 2018, an increase of€15.3 million.

Non-recurring expenses amounted to€24.8 million, compared with €19.9 million in2018. These expenses correspond tomeasures to adapt the organisation, toacquisition and disposal costs and includethe capital gains from the disposal ofRayonnance at year-end 2019.

The Group's operating profit was€99.4 million compared with €86.8 million in2018, a year-on-year increase of 14.5%.

The net financial expense was up to€19.2 million compared with €15.5 million atyear-end 2018. Two main effects should bestressed: the full year effect of the interestexpense related to the OCEANE issued inMarch 2018 and the first time application byEconocom in 2019 of IFRS 16 to leaseagreements.



KEY FIGURES BY BUSINESS2.1.1.

Revenue and profit (loss) from continuing operations * can be broken down by business asfollows:

Revenue

in € millions 2019 2018restated(1)

changebased on

like-for-likestandards

Like-for-likechange

Technology Management & Financing 1,124 1,321 10.0% (10.3%)

Digital Services & Solutions 1,803 1,678 7.4% 6.3%

Total revenue 2,927 2,999 0.0% (0.8%)See chapter 5 § 2.1.(1)



Totalgrowth

Profit(loss) fromcontinuingoperations(as a % of 2019

revenue)

Profit (loss)from

continuingoperations

(as a % ofrevenue 2018)

Technology Management & Financing 43.9 52.3 (16.1%) 3.9% 4.0%

Digital Services & Solutions 82.3 58.6 40.4% 4.6% 3.5%

Total profit (loss) from continuing operations* 126.2 110.9 13.8% 4.3% 3.7%

Before amortisation of intangible assets from acquisitions*

cf. chapiter 5 § 2.1.(1)

At 31 December 2019, TechnologyManagement & Financing posted revenue of€1.124 million, a decline of 10.3% due mainlyto the contraction of the business of itsItalian subsidiary amounting to €130 millionon a full year basis. Excluding this impact,TMF revenue rose by 0.6% thanks to theperformance of the other regions (mainlyFrance, Belgium, Spain and the UnitedKingdom). Recurring operating income* fromthis activity was €43.9 million, comparedwith €52.3 million in 2018. This includes thelower contribution from TMF Italy which waspartly offset by the improved profitability inFrance and the Benelux countries.

The Digital Services & Solutions business linereported revenue of €1,803 million in 2019, up7.4% on the previous year's level of €1,678million. The organic growth of 6.3% wasdriven by the sales of "products andsolutions", including, for example, majorprojects to equip French local authorities andschools with IT equipment. Profit (loss) fromcontinuing operations was €82.3 millioncompared with €58.6 million the previousyear. This large improvement is the result ofthe organic growth of activity and costcontrol measures put in place since 2018.

Before amortisation of intangible assets from acquisitions.*


05management reportrofit for the year

KEY FIGURES BY GEOGRAPHICAL AREA2.1.2.

Revenue breaks down as follows:


Change basedon like-for-like

standards

France 1,545 1,510 4.6%

Benelux 391 395 (1.1%)

Southern Europe/Morocco 529 621 (10.5%)

Northern and Eastern Europe 261 265 7%

Americas 200 207 (3.2%)

Total revenue 2,927 2,999 0.0%Before amortisation of intangible acquisition assets.(1)

The increase in France stemmed from thegood performance in the Digital Services &instead of Solutions business lines, whichoffset the slight decline in TechnologyManagement & Financing.

Contraction in the Benelux area was drivenmainly by Technology Management &Financing in the Netherlands, despite strongperformance by the DSS business.

Restated for the fall in revenue of TMF inItaly, organic growth in Southern Europeand Morocco is estimated at about 10%thanks to good performances in Spain andof the DSS activity in Italy.

2019 Southern Europe turnover of €528.6million breaks down as €306.4 million forItaly and €222.2 million for Spain. In 2018 thecorresponding figures were €397.9 millionfor Italy and €201.4 million for Spain (after anIFRS 16 restatement of €21.9 million).

Northern and Eastern Europe recordedslight organic growth on a like for like basis,essentially thanks to the TechnologyManagement & Financing activity in theUnited Kingdom.

The Americas region fell back slightly aftertwo years of very strong growth, thanksprimarily to major Technology Management& Financing contracts.



Statement of financial position2.2.

in € millions 2019 2018 restated(1)

Goodwill 512.9 631.1

Other long-term assets 182.7 159.7

Residual interest in leased assets 165.0 163.8

Other non-current assets 51.0 49.0

Trade and other receivables(2) 1,093.7 1,268.6

Other current assets 136.6 128.5

Cash and cash equivalents 593.8 608.4

Assets held for sale 201.1 -

Total assets 2,936.8 3,009.2In accordance with the specifications of the standards, the 31 December 2018 statement of financial position is(1)

not restated for the impact of the application of IFRS 5 and 16 beginning in January 2019 (see chapter 6 sections1.1.1 and 1.1.2).of which self-funded outstanding rentals: €238.5 million at 31 December 2019 versus €246.2 million at 31(2)

December 2018.

in € millions 2019 2018 adjustedrestated(1)

Equity attributable to owners of the parent 410.2 396.4

Non-controlling interests 73.7 94.9

Total equity 483.9 491.3

Bonds(2) 441.4 437.5

Financial liabilities(2) 404.6 422.6

Provisions 73.2 88.8

Gross liability for purchases of leased assets 101,5 98.1

Trade and other payables 980.6 1,104.2

Other liabilities 368.3 366.6

Liabilities held for sale 83.2 -

Total equity and liabilities 2,936.8 3,009.2In accordance with the specifications of the standards, the 31 December 2018 statement of financial position is(1)

not restated for the impact of the application of IFRS 5 and 16 beginning in January 2019 (see chapter 6 sections1.1.1 and 1.1.2).

After deduction of the €593.8 million of cash and cash equivalents posted to assets as at 31 December 2019(2)

(€608.4 million at 31 December 2019), net debt was €252.2 million at 31 December 2019 (€251.7 million at 31December 2018); this net debt includes €238.5 million at 31 December 2019 (€246.2 million at 31 December 2018)for self-funded TMF contracts and the anticipated rents from this activity.



The statement of financial position below expresses this more concisely:

by posting the positive cash and cash equivalents from bond debt and other financial•liabilities in liabilities to show net book debt directly on this side of the balance sheetforthe share of TMF self-funded contracts;

by showing trade receivables on the asset side and net debt in liabilities. •

in € millions 31 December 2019 31 December 2018

ASSETS

Goodwill 513 631

Other non-current assets 234 209

Residual interest in leased assets 165 164

Trade and other receivables 1,094 1,269

of which outstanding on self-funded contracts 239 246

Other current assets 137 129

Assets held for sale 201 -

TOTAL ASSETS 2,343 2,401

in € millions 31 December 2018 31 December 2018

LIABILITIES

Total equity 484 491

Net debt 252 252

of which net debt linked to self-funded contracts 239 246

of which net debt - other 13 6

Gross liability for purchases of leased assets 102 98

Other non-current liabilities 131 124

Trade payables 981 1,104

Other current liabilities 311 332

Liabilities held for sale 83 -

TOTAL EQUITY AND LIABILITIES 2,343 2,401



Goodwill

Goodwill amounted to €512.9 million, down€118.2 million compared with the previousyear. This decrease is due mainly to thereclassification of the goodwill operationsheld for sale to assets held for sale, as well asthe disposals carried out during the year.There were no acquisitions in 2019.

Equity

the year nearly offsets the redemption of theissue premiums and the equity transactionscarried out during the year.

Total equity stood at €483.9 million, downslightly by €7.3 million compared withend-2018. This decline includes the impact ofaround -€3.0 million from the application ofIFRS 16 from 1 January 2019. Net income for

At 31 December 2019, Econocom group held23,458,144 treasury shares valued at€57.0 million not recorded in its balancesheet (at the share price on 31 December2019, i.e. €2.432).

The breakdown of equity attributable toowners of the parent and to non-controllinginterests varies as a result of acquisitions.Accordingly, equity attributable tonon-controlling interests stood at€73.7 million at 31 December 2018, comparedwith €94.9 million at the previous year-end.

Net debt

At 31 December 2019, net debt stood at €252.2 million and broke down as follows:

in € millions 2019 2018


Bank debt and commercial paper (310.3) (290.7)

Net cash at bank 283.6 317.7

Convertible bond debt (OCEANE) (189.2) (185.5)

Non-convertible bond debt (Euro PP) (102.3) (102.2)

Non-convertible bond debt (Schuldschein) (149.9) (149.8)

Other (94.3) (131.7)

Net debt (252.2) (251.7)

Net book debt remained stable compared financial debt to equity ratio) was 52.1%. Thiswith end-2018 at €252.2 million, representing net book debt includes €238.5 million in TMF1.4 times EBITDA in 2019, while gearing (net self-driven contracts.



Appendix - Definition of key performance indicators

Performance indicators not defined byaccounting standards but used byEconocom group to assist the reader inassessing the Group’s economic andfinancial performance are as follows:


Profit (loss) from continuing operationsincludes all income and expenses directlyrelated to the Group’s operations, whetherrecurring or not. It excludes othernon-current income and expenses.

Profit (loss) from continuing operationsbefore amortisation of intangible assetsfrom acquisitions

Recurring operating profit beforeamortisation of intangible assets fromacquisitions measures the level of operatingperformance after the amortisation ofintangible assets acquired through businesscombinations. At 31 December 2018, themain acquisitions of intangible assets madeby the Group and whose amortisation is nottaken into account for the determination ofthis aggregate are the ECS customerportfolio and the Osiatis brand.

Econocom uses recurring operating profitbefore amortisation of intangible assets fromacquisitions as the main indicator to monitorthe operational performance of itsbusinesses.

Other non-recurring operating incomeand expenses

fixed assets, restructuring expenses, costsrelating to workforce adjustment measures,costs of relocating premises, changes in thevalue of acquisition-related liabilities(earn-out payments), as well as costs relatedto the various external growth transactions.

“Other non-recurring operating income andexpenses” include items that, by theirfrequency, amount or nature, are liable toundermine the pertinence of the Group’soperating performance as a performanceindicator. “Other non-recurring operatingincome and expenses” include impairmentlosses on goodwill and other intangibleassets, the results of significant disposals of

EBITDA (Earnings before Interest, Tax,Depreciation and Amortisation)

The Group also uses an intermediatemanagement balance known as “EBITDA”.This financial indicator corresponds torecurring operating profit adjusted fordepreciation and amortisation, additions toand reversals of provisions for assetimpairment and provisions forcontingencies and losses, and netimpairment losses on current andnon-current assets recognised in recurringoperating profit.

Recurring profit attributable to owners ofthe parent

Since the first half of 2016, recurring net profitattributable to owners of the parent has beenthe key performance indicator used byEconocom to assess its economic andfinancial performance. Recurring profitattributable to owners of the parentcorresponds to profit for the year attributableto owners of the parent, before the followingitems:

amortisation of intangible assets from•acquisitions (in the year ended31 December 2018, amortisation of the ECScustomer portfolio and the Osiatis brand),net of tax effects;

adjustment of the fair value of the•ORNANE embedded derivativecomponent;

other non-recurring operating income and•expenses, net of tax effects;

non-recurring financial income and•expense, net of tax effects;



profit (loss) from discontinued operations,•net of tax effects.

Net and gross debt

The definition of net debt used by theGroup (see note 14.3 to the consolidatedfinancial statements) is gross debt lessgross cash and cash equivalents. It does notinclude the Group's gross liability forpurchases of leased assets or its residualinterest in leased assets.

Gross debt includes all interest-bearing debtand debt incurred by receiving financialinstruments.

Parent company 2019 2.3.financial statements of Econocom group SEEconocom group SE, as the Group’s holdingcompany, manages a portfolio of securities,receives dividends from its subsidiaries andoversees the Group’s development.

It also provides services to the Group’ssubsidiaries in the areas of management, IT,cash, guarantees, provision of staff,consulting, communication and marketing.These services are billed according tonormal market terms.

The revenue stated hereafter refers toEconocom group SE’s parent companyfinancial statements, prepared in accordancewith Belgian legislation.

INCOME STATEMENT OF 2.3.1.ECONOCOM GROUP SE

The cost of services rendered to the Group’ssubsidiaries during the year totalled€23.5 million, compared with €24.8 millionin the previous year.

Operating profit for the year amounted to€2.6 million, compared with €5.1 million in2018.

Recurring financial income totalled€19.5 million, compared with €14.3 million in2018. It consists mainly of dividends receivedfrom subsidiaries in the amount of €18.7million (compared to €19.0 million in 2018),income net of interest and guaranteecommissions invoiced to the subsidiaries inthe amount of €12.8 million (compared with€11.2 million in 2018), and the cost of externaldebt in the amount of €11.7 million(compared with €10.2 million in 2018) and thecapital gains or losses on sale of treasuryshares representing a net expense of€0.2 million this year (compared with a netexpense of €5.7 million in the previous year).

Non-recurring financial expense totalled€39 million, compared with €21.4 million in2018. It includes mainly capital losses on thedisposals of Jade and Mobis, the €16.5 millionimpairment of securities, and the €9.6million impairment of treasury shares.

Income tax expense came to €1.9 million.

Net loss totalled €19.1 million, comparedwith a loss of €2.3 million in the previousyear.

BALANCE SHEET OF 2.3.2.ECONOCOM GROUP SE

Econocom group SE’s equity stood at€349.0 million, compared with€394.8 million in 2018. This change can beascribed to the refund of the issue premiumin July 2019 in the amount of €27.4 millionand to the profit for the year (-€19.1 million).

The company's balance sheet shows lossesin two consecutive financial years, so article6:3 6 of the French Companies and CharitiesCode is applicable. These losses are mainlyexplained by the impairment of treasuryshares. The continuity of the business istherefore in no way threatened and theapplication of valuation rules which assumea going concern is therefore justified.



Financial liabilities (non-Group) totalling agross amount of €721.3 million correspond tothe EURO PP of €102.5 million (issued inMay 2015 with maturities of five and sevenyears), the Schuldschein note of€150.2 million (issued in November 2016 withmaturities of five and seven years), theOCEANE worth €190.1 million issued inMay 2018 with maturities of five years) andthe commercial paper programme worth€278.5 million (with short-term maturities ofbetween one and three months).

Receivables and equity investments inrelated companies increased by€79.9 million to €1,006.6 million due to newequity investments in August 2019 for theamount of €101.8 million for disposals andimpairment see below.

2.3.3. SHARE CAPITAL

At 31 December 2019, Econocom group’sshare capital totalled €23,512,749.67,divided into 245,380,430 shares with nostated par value.

Changes in capital since 2010 have consistedof (i) capital increases in connection with theexercise of stock options by the Group’smanagers and (ii) capital increases either aspart of external growth transactions to funda portion of the acquisition price or as aresult of the conversion of bonds.

The only items that could have an influenceon Econocom group’s share capitalcorresponding to the 2014 and 2017 stockoption plans and the OCEANE convertiblebond issued on 1 March 2018.

In December 2014, the Board of Directorsapproved a stock option plan (“2014 StockOption Plan”) and decided to issue, withcancellation of shareholders’ pre-emptivesubscription rights, 2,500,000 stocksubscription rights entitling the holders tosubscribe, under certain conditions, to anew Econocom group share. TheCompensation Committee had two years todetermine the beneficiaries of the 2014Stock Option Plan.

A total of 2,480,000 stock options weregranted to approximately 20 of the Group’smanagers under the 2014 Stock Option Plan.At 31 December 2019, taking into account theoptions lapsed due to departures and failureto meet performance conditions, a total of2,041,420 of the 2014 stock options were stillexercisable, which correspond to themaximum issue of 4,082,840 new shares,each option entitling holders to twoEconocom group shares following thetwo-for-one split that took place in June 2017.

In June 2017, the Board of Directors alsoapproved a stock option plan (“2017 StockOption Plan”) and decided to issue, withcancellation of shareholders’ pre-emptivesubscription rights, 2,000,000 stocksubscription rights entitling the holders tosubscribe, under certain conditions, to a newEconocom group share. The CompensationCommittee had until 31 December 2019 todetermine the beneficiaries of this plan. At31 December 2019, taking into account theoptions forfeited by beneficiaries, thenumber of 2017 stock options allocatedamounted to 90,000 corresponding to amaximum issue of 90,000 new shares.

On 1 March 2018, Econocom launched theissuance of convertible bonds and/orexchangeable for new and/or existingshares (OCEANE) with a par value of€200 million, maturing in 2023. The holdersof Bonds will have a right to the award ofShares that they may exercise at any timefrom the Issue Date (i.e. 6 March 2018) anduntil the 8th business day (inclusive)preceding the normal or early redemptiondate on the basis of a conversion orexchange ratio of one Econocom Share perBond and subject to any subsequentadjustments. In the event of request ofconversion of Bonds, the Bond holders willreceive, at Econocom's discretion, newand/or existing shares of Econocom. Todate, the number of bonds outstanding is24,213,075. If all the bonds were converted(if the conversion price of €8.26 wasreached) into new shares, according to thecurrent conversion ratio of 1 share for 1



bond, 24,213,075 new shares would beissued.

Finally, the Extraordinary General Meeting of19 May 2015 renewed, for a five-year period,the authorisation given to the Board ofDirectors, in accordance with articles 7:198and 7:199 of the new Belgian CompaniesCode (Code des sociétés), to carry out one ormore capital increases of up to a maximumtotal amount of €21,563,999.86 (excludingissue premiums). At 31 December 2019,authorised unissued capital (excluding issuepremiums) stood at €19,052,787.28.

The Company’s ownership structure isdescribed in section 5, “Corporategovernance statement”.

Treasury shares

Econocom group has a share buybackprogramme, which allows it to:

deliver shares to avoid potential dilution of•shareholders’ interests due to the exerciseof options;

pay for any external growth transactions;•

award to free share plan beneficiaries;•

cancel shares acquired.•

The Extraordinary and Special GeneralMeeting of 21 May 2019 renewed for afive-year period the authorisation given tothe Board of Directors to buy back treasuryshares. The minimum purchase price wasset at the equivalent of €2 and themaximum unit price at €10.

The maximum number of shares to bepurchased throughout the five-year periodis 49,076,086. Since the beginning of thebuyback programme, 6,647,409 shares havebeen acquired at 31 December 2019.

In 2019, the following treasury sharemovements took place, (excluding liquidityagreements):

Econocom group acquired 9,688,513•Econocom group shares, for an acquisitionprice of €26.6 million;

Econocom group transferred 85,000•treasury shares to two Free Share Planbeneficiaries;

As at December 2019, Econocom group held23,458,144 treasury shares acquired underits share buyback program. The treasuryshares represent 9.56% of the total numberof shares issued.

The voting rights associated with the sharesheld by the Company have been suspended.The shares held by the Company do not giveentitlement to dividends.

Econocom group’s distributable reserves(statutory data) stood at €197.6 million, inaddition to retained earnings in the amountof €68.4 million.

Econocom group’s non-distributablereserves stood at €57.0 million.



BUSINESS OVERVIEW2.3.4.

Acquisitions, disposals, 2.3.4.1.equity investments and formations of subsidiaries

In 2019, Econocom group acquired additionalequity investments in some of its satellitesthrough buybacks of non-controllinginterests and carried out disposals as part ofthe Group's transformation plan.

Thus, the Econocom group exercised itsoptions in order to strengthen its stake inInfeeny and Gigigo group.

It sold its stakes in Jade Solutions andRayonnance.

Moreover, as part of the management of itssubsidiaries and the Group organisationchart:

Econocom group acquired from Econocom•Lease its equity investment in EconocomFinance, the Group's cash centre in chargeof financing Group companies. Followingthat transaction, Econocom group directlyholds 100% of Econocom Finance's capital.Moreover, Econocom group acquired fromits subsidiary Econocom International Italiaall the stock in the Italian company BDF;

Econocom also subscribed to the capital•increases carried out by its subsidiaryDigital Dimension;

lastly the Group created a reinsurance•company, Econocom Ré aimed at bettermanaging (in coordination with insurancecompanies) the hedging of the credit risksof its TMF business.

Legal reorganisation2.3.4.2.

As is the case each year, Econocom groupimplemented measures to streamline andsimplify its legal organisation.

Measures performed in 2019 were aimed atcombining companies with similar activitiesin the same country. In France, Exaprobeabsorbed its subsidiary Aciernet, and inSpain Altabox absorbed Focus on Emotion.

Moreover, in order to streamline andsimplify its organisation chart, the Groupclosed down certain non-operatingsubsidiaries in the Netherlands and Spain.

As a result of the reorganisations carried outin 2019, the number of legal entities withinthe Group was reduced by four, therebystreamlining the Company organisation.


05 management reportrisk factors and disputes

Risk factors and disputes3.Risk factors did not change significantly in 2019. They are described in note 19.

Outlook for 2020 and 4.shareholders' compensationThe Management of the Econocom groupwill be paying particular attention togenerating cash and maintaining rigorouscost management.

issue premium, considered as paid-incapital, in the amount of €0.12 per share.

As a result of the Group’s strong financialposition, the Board of Directors willrecommend to the General Shareholders'Meeting to proceed with a refund of the

This refund represents stability comparedto recent years.

Moreover, the Group plans to continueshare buybacks. These shares are intendedto cover the commitments made understock option plans.


05management reportcorporate governance statement

Corporate governance 5.statement

Applicable corporate 5.1.governance codeEconocom group confirms that it adheres tothe principles of the Belgian CorporateGovernance Code that came into force in2009 (the “2009 Code”) and that it plans toadhere to the principles of the new BelgianCorporate Governance Code that comesinto force on 1 January 2020. This Code isavailable at:

www.corporategovernancecommittee.be

Econocom publishes the various InternalRules (in French only) that comprise itsCorporate Governance Charter on itswebsite:

www.econocom.com under Investors/Governance/Board of Directors andExecutive Committee.

The Board of Directors adheres to theCorporate Governance Code. Thetransformation of Econocom group into aEuropean Company (societas europaea) on18 December 2015 prompted the Board ofDirectors to change the Internal Rules ofthe Board of Directors and the ExecutiveCommittee on 19 May 2016. The ExecutiveCommittee’s Internal Rules again changedon 7 September 2016, and the Committeewas renamed the Executive Committee atthat time. In connection with the change inits corporate governance, the Econocomgroup in early 2020 was required to amendthe Internal Rules of its Audit Committeeand its Compensation Committee. Thelatter was renamed “Compensation andNominations Committee” on that occasion.

Exemptions from the 5.2.2009 CodeEconocom group applies therecommendations of the 2009 Code,except for those which the Board hasdeemed ill-suited to Econocom group’ssize, or that it intends to implement overthe long term. The principles with whichEconocom group does not comply, inwhole or in part, are described below.

The Group currently only partially appliesthe recommendations of Principle 1 of theCode.

Jean-Louis Bouchard combines the dutiesof Chairman of the Board of Directors, ChiefExecutive Officer and Chairman of theGroup’s Executive Committee. As such, theGroup does not fully adhere to the principleof segregating the Board of Directors’powers of control and executive powers. At31 December 2019, Jean-Louis Bouchardindirectly held 36.44% of Econocom group’scapital. Such a system meets thecharacteristics of Econocom group’sshareholdings and is aimed at ensuringmanagement stability as Econocomimplements its long-term strategy.

Moreover, the Board of Directors has todate decided against appointing aSecretary to advise it on governance andreport to it on compliance with theapplicable procedures and rules. However,this function had been taken overinformally by Galliane Touze, CompanySecretary of the Econocom group until31 July 2019 and by Antoinette Roche, LegalDirector as from that date.


05 management reportcorporate governance statement

Since 23 November 2017, one-third of themembers of Econocom group’s Board ofDirectors have been women, pursuant tothe conditions set out in article 7 section 85of the new Belgian Companies Code. At31 December 2019, the Board had fourwomen members: Véronique di Benedetto,whose term was renewed in 2017, andAdeline Challon-Kemoun, Anne Lange andMarie-Christine Levet, appointed in 2016.

Following the entry into force of theEuropean Market Abuse Regulation, on18 May 2017 the Board of Directors modifiedthe provisions of its Internal Rules layingdown procedures for controlling markettransactions.

Econocom group does not currently applythe recommendations in Principle 4 of the2009 Code, which state that “the Boardshould draw up nomination procedures andselection criteria for Board members” andthat “a Nomination Committee shouldrecommend suitable directorshipcandidates”. This principle also recommendsa periodic assessment of each Director andof the Board of Directors and itsCommittees, in accordance with proceduresset by the Board.

Committee, in charge of suggestingappointments to the Board of Directors.

Up until now, the Board of Directors hadnot wished to establish a NominationCommittee, nor any formal procedures forappointing the members of the Board ofDirectors and the Executive Committee,given that this recommendation by theCode was not suitable for the Econocomgroup because of its size. As from 2020 theBoard of Directors has decided to changethe Compensation Committee to becomethe Compensation and Nominations

Although the Group has no specific formalprocedures for assessing the Board ofDirectors and its members andCommittees or the members of theExecutive Committee, such assessmentstake place on an ongoing basis. In 2019, theBoard of Directors entrusted SpencerStuart with the task of assessing theGroup's governance. The findings werepresented during the 4 September 2019meeting of the Board of Directors.

In 2004, the Board of Directors of Econocomgroup established an Audit Committee. At31 December 2019, its composition was notcompliant with the 2009 Code, whichrequires that a majority of members ofsuch Committees be independent. TheCommittee comprises three Non-executiveDirectors selected by the Board for theirrecognised accounting skills, but two ofwhom (Gaspard Dürrleman and RafiKouyoumdjian) are not independent.

The Chairman of the Board of Directors doesnot systematically attend Annual GeneralMeetings, contrary to the recommendationsof Principle 8 of the 2009 Code, but heensures that the Board of Directors is alwaysrepresented by at least one Chief ExecutiveOfficer.

Information about the main shareholdersof Econocom group and their relationshipwith each other and the Company, are notpublished in the Corporate GovernanceCharter, but in the Management Reportand updated each year.



Description of 5.3.internal control and risk management procedures in the context of the preparation of the financial informationThe financial information communicated bythe Group refers to its consolidated financialstatements and to the managementaccounting aspects of the financialstatements published in compliance withIFRS as adopted by the European Union andapproved by the Board of Directors.

This financial information is, at everyreporting date, presented to the Group’sAudit Committee, and explained to all theDirectors.

FINANCIAL ORGANISATION5.3.1.

The Group’s financial organisation is bothlocal and global. The Group is organised bybusiness line and country. Financialprocesses are implemented by financeteams, Finance Directors and financialcontrollers, all of whom report to the GroupFinancial Controller. Business and countryFinancial Controllers ensure that thereporting rules and practices are appliedconsistently across the business lines,irrespective of the country.

COORDINATION OF 5.3.2.REPORTING AND CONSOLIDATION

The accounts are consolidated by adedicated team on a quarterly basis. Theconsolidated companies send their detailedfinancial statements via the consolidationtool for inclusion in the consolidatedfinancial statements.

Management. These reports are draftedjointly by the entity’s operational managerand Financial Controller.

Each entity (i.e., company or business unit)draws up a budget. Profit forecasts areadjusted several times during the year andare monitored on a monthly basis based onthe activity reports provided to Group

The Group’s Financial Controlling draws upschedules and specific instructions for thevarious budgets, reports and the itemsneeded for the purpose of consolidation.

ACCOUNTING STANDARDS 5.3.3.AND MONITORING

The Group’s accounting principles are setout in an accounting principles manualwhich is used as the basis for preparingfinancial information. This manual describesthe method for recording transactions andpresenting financial information.

The team in charge of consolidation is alsoresponsible for keeping abreast of changesto IFRSs.

IT SYSTEMS5.3.4.

The Information Systems Departmentoversees the various information systemsused by the Group. It ensures the gradualharmonisation of the solutions implementedand the continuity of operations. In thepreparation of financial information,information flows from IT tools specific to thevarious businesses are centralised in a singleaccounting management and reportingsolution.

RISK FACTORS, 5.3.5.SURVEILLANCE AND MONITORING

The monthly reports enable the variousoperational and financial managers and theGroup’s Management to verify that theGroup’s results are accurate and consistentwith the targets set. At the end of eachquarter, they contain a comparison betweenthe management data and the Group’sconsolidated financial statements in order toensure that the financial information isreliable.



The Group’s Internal Audit Departmentcompletes the risk organisation, and is incharge inter alia of drawing up a risk map. Italso reviews the subsidiaries’ financialstatements in order to ensure that theycomply with Group rules, and verifies thatthe reports are accurate and that risks areadequately covered. The Group’s InternalAudit Department reports directly to theAudit Committee and to the Chairman.

When identifying risks that may impact theachievement of financial reportingobjectives, Group Management takes intoaccount the possibility ofmisrepresentations and fraud, andundertakes the required actions tostrengthen internal control, if necessary. TheInternal Audit conducts specific audits, onthe basis of the assessment of potentialfraud risks, in order to avoid and preventfraud. Any findings are systematicallyreported to the Audit Committee.

Risks associated with 5.3.5.1.accounting systems

Risks associated with accounting systemsare assessed on a regular basis with a viewto implementing improvement plans.

The accounting systems used within theGroup have now been harmonised, and areshared by all business lines and subsidiariesexcept the Satellite companies in which theGroup has acquired stakes, some of whichstill use software other than that usedelsewhere in the Group, more adapted totheir size.

The various business line IT systems areinterfaced with the accounting system inorder to ensure that information ontransactions is traceable, comprehensiveand reliable.

The consolidation system is a standard tool.

Risks associated with 5.3.5.2.accounting standards

The Consolidation Department, inconjunction with the Group FinancialControlling Department and the Businessand Country Financial Controllers, monitorschanges in IFRSs and adapts the Group’saccounting principles accordingly. It alsoorganises training for finance staff whenevernecessary.

Main transaction control 5.3.5.3.procedures

In order to ensure the reliability of thefinancial information on transactions, the“Financial Control” team verifies each monththat the revenue and costs reported are inline with the flows expected at the time thetransactions were approved.

The Group Financial Controlling draws upregular statistical analyses to ensure thatthe assumptions made when the leasecontracts were recorded are prudent andappropriate.

The subsidiaries’ Financial Controllingteams also carry out monthly verificationsfor each business line.

PERSONS RESPONSIBLE FOR 5.3.6.THE PREPARATION OF FINANCIAL INFORMATION

The financial information is prepared underthe supervision and responsibility of theBoard of Directors, which, since 2004, hashad an Audit Committee, the role of which isset out in section 5.5.3 below.



Ownership structure and limits on shareholder 5.4.rightsAt 31 December 2019, Econocom group’s share capital consisted of 245,380,430 shares, heldas indicated below:

2019 2018

Companies controlled by Jean-Louis Bouchard 36.44% 36.44%

Public shareholders 54.00% 57.86%

Treasury shares 9.56% 5.70%

Total 100% 100%

Econocom group is informed that twoshareholders outside the companiescontrolled by Jean-Louis Bouchard, crossedthe 5% share-ownership threshold as at31 December 2019. They are Butler IndustriesBenelux (and indirectly WB Finance andWalter Butler) and the US company FMRLLC (FIAM LLC, FMR Co., Inc. and FidelityInstitutional Asset Management TrustCompany).

There are no shareholders with specialcontrolling rights.

statutory restrictions with respect to votingrights.

Each Econocom group share gives its holderthe right to cast a vote at Annual GeneralMeetings. Article 10 of the Company’sBylaws provides that the exercise of thevoting rights and other rights attached toshares held in co-ownership or in which theusufruct and the bare ownership have beenseparated, or which are pledged, shall besuspended until such time as a solerepresentative has been appointed toexercise the rights attached to the shares inquestion. Treasury shares (9.56%) and sharesheld by the Belgian Caisse des Dépôts etConsignations (0.44% belonging to bearershareholders who did not come forwardwhen the Belgian Stock Market convertedto electronic shares) also have no votingrights. There are no other particular legal or

Similarly, with the exception of theprovisions limiting purchases and sales byEconocom group of its treasury shares, theCompany’s Bylaws do not impose anyrestrictions on the transfer of its shares.

The composition 5.5.and functioning of the administrative bodies and Committees

COMPOSITION OF 5.5.1.THE BOARD OF DIRECTORS

At 31 December 2019, the Board of Directorshad 12 members:

Jean-Louis Bouchard

(term of office expires at the May 2020 Annual General Meeting)

1 Avenue de Montmorency, Villa Montmorency, 75016 Paris (France)

Chairman of the Board of Directors and Chief Executive Officer of Econocom group

Chairman of Econocom International BV



Robert Bouchard


23 Avenue de Boufflers, 75016 Paris (France)

Vice-Chairman of the Board of Directors and of Econocom group

Bruno Grossi


13 Rue Molitor, 75016 Paris (France)

Chief Executive Officer of Econocom group

Véronique di Benedetto


86 Rue Miromesnil, 75008 Paris (France)

Non-executive Director of Econocom group

Gaspard Dürrleman


50 Avenue Bosquet, 75007 Paris (France)


Rafi Kouyoumdjian


4 Avenue de la Bourdonnais, 75007 Paris(France)


Jean-Philippe Roesch


21 Avenue de la Criolla, 92150 Suresnes(France)


Walter Butler


30 Cours Albert 1er, 75008 Paris (France)

Independent Director of Econocom group

Adeline Challon-Kemoun


32 Avenue Duquesne, 75007 Paris (France)


Anne Lange


4 Avenue de Villiers, 75017 Paris (France)


Marie-Christine Levet


91 Rue du Cherche-Midi, 75006 Paris (France)


Jean Mounet


60 Quai du Parc, 94100 Saint-Maur-des-Fossés (France)


At 31 December 2019, the Board of Directorsaccordingly comprised:

an Executive Chairman, Jean-Louis•Bouchard. He is tasked with managing theBoard of Directors and ensuring itsefficient running, by monitoring its size andmembers and those of its Committees, andensuring good communication with theExecutive Committee to guaranteeeffective decision-making. The Committeeappoints the Chairman from among theVice-Chairs;


05management reportorporate governance statement

a Vice-Chairman, Robert Bouchard. The•Annual General Meeting of 19 May 2015,voted to establish a mandate for theVice-Chairman of the Board, and on 21 May2015 the Board of Directors appointedRobert Bouchard Vice-Chairman of theBoard until the end of his term of office.The Board appoints one or moreVice-Chairs from its members. In the eventthat the Chairman is unable to attend, theVice-Chair chairs the Board meetings;

two Chief Executive Officers in charge of•the day-to-day management of Econocomgroup, Jean-Louis Bouchard (appointed on5 March 2018) and Bruno Grossi (appointedat the Board meeting of 4 November 2015,with effect from 18 December 2015);

five non-executive Directors, Véronique di•Benedetto, Robert Bouchard, RafiKouyoumdjian, Jean-Philippe Roesch andGaspard Dürrleman. Véronique diBenedetto exercised operational functionswithin Econocom group companies at31 December 2019. However, she is notconsidered to be an Executive Director, asthis status is reserved for Directors holdingexecutive positions at Econocom groupitself, in accordance with a decision of theBoard of Directors dated 24 November2016;

lastly, five independent Directors within the•meaning of article 7:87 sections 1 and 2 ofthe new Belgian Companies Code, WalterButler, Adeline Challon-Kemoun, AnneLange, Marie-Christine Levet and JeanMounet.

Jean-Louis Bouchard was appointed by theBoard of Directors at its meeting of 5November 2018 as Chief Executive Officer ofthe Econocom group.

During the course of the 2019 financial year,Mr Jean-Philippe Roesch continued with theassignment he accepted at the end of 2018,namely to advise and support the ExecutiveCommittee; initially via the companyOrionisa Consulting, of which he is theChairman and Shareholder, and then withinthe framework of a part-time, 6 monthcontract which ended on 31 July 2019. He istherefore considered Executive Directorsolely for the duration of this assignment.

The Bylaws do not contain any special rulesfor appointing Directors or for renewingtheir term of office. Nor do they impose anyage limit on the Board.

Pursuant to a decision of the Extraordinaryand Special General Meeting on18 December 2015, the term of office forDirectors has been reduced from six to fouryears in order to comply with therecommendations of the 2009 Code.

Other than their office on the Board ofDirectors of Econocom group, certainDirectors have other offices, as set out below.

The Chairman of the Board of Directors hascontrolling interests in a number ofcompanies outside Econocom group andserves as Legal Manager or Chairman withinthem. Jean-Louis Bouchard is Chairman ofEconocom International BV and ChâteauFontainebleau du Var, and Legal Manager ofSCI Orphée, SCI de Dion Bouton, SARL ÉcurieJean Louis Bouchard, SCI JMB, SCI LBB, SNCFontainebleau International and SCI 1Montmorency.



In addition to serving on the Board ofEconocom group and its subsidiaries, BrunoGrossi is Legal Manager of Vilnaranda II ,non-executive Chairman of Vision d'Entrepriseand Director of Araxxe.

Robert Bouchard is the permanentrepresentative of GMPC, the legal entity thatchairs APL France. He also serves asChairman of Ecofinance SAS, Legal Managerof GMPC and Co-manager of SCI MaillotPergolèse.

In addition to her corporate officer roles atEconocom Group and its subsidiaries,Véronique di Benedetto is Chairwoman ofSAS Numeya. She is also an independentDirector of Hexaôm, and serves on theBoards of a number of associations includingSyntec Numérique (French professionalfederation of members of the digitalindustry) and 100 000 entrepreneurs.

Gaspard Dürrleman does not serve on anyother Boards outside those of Econocomgroup.

Rafi Kouyoumdjian is Chairman of RKOManagement & Investment BV, and aDirector of RKO Edith Grove Ltd.

Jean-Philippe Roesch is Legal Manager ofLa Criolla and Chairman of OrionisaConsulting and member of the SupervisoryBoard of Linkfluence SAS.

Butler Capital Partners and WB DebtPartners, Legal Manager of SCI 30 Albert 1er,Chairman of Amstar Entreprises and FBTDéveloppement, Nexis Fiber Holding, EdenInnovations and Doc, Chairman of the Boardof Directors of NXO Expansion, Chairman ofthe Supervisory Board of NXO France,member of the Supervisory Board of GroupePartouche and Corum Asset Management,Director of Butler Industries Benelux, NXOExperts and NXO Sécurité, and Director ofButler Investment Managers Limited, ButlerManagement Limited, Almas Industries Ltdand Almas Industries UK. Walter Butler isalso the permanent representative of ButlerCapital Partners in his capacity as memberof the Supervisory Boards of AccessIndustries and Colfilm, and as Director ofHolding Sports et Evenements.

Walter Butler is Chairman and ChiefManaging Director of Butler Industries,

Adeline Challon-Kemoun is a Director ofBourbon Corporation.

Anne Lange is a Director of Orange, PernodRicard, FFP and Inditex.

Marie-Christine Levet is a Director of Iliad,Maisons du Monde, So-Local and AFP.

Jean Mounet is a Director of Sopra BankingSoftware. He is Chairman and Director ofHorizontal Software and SAS Trigone. He isalso a Director of ESCPE, Chairman andDirector of the Fondation CPE Lyon MondeNouveau and Chairman of the StatutoryCommittee of Syntec Numérique.



FUNCTIONING OF THE BOARD OF DIRECTORS5.5.2.

The Board of Directors meets as often as it deems necessary. It met six times in 2019.

The table below sets out the attendance of each Director at meetings of the Board and thevarious Committees in 2019:

Board ofDirectors Audit Committee Compensation

Committee

Jean-Louis Bouchard 6 - -

Robert Bouchard 5 - -

Bruno Grossi 6 - -

Véronique di Benedetto 6 - -

Gaspard Dürrleman 6 6 -

Rafi Kouyoumdjian 5 5 2

Jean-Philippe Roesch 6 - -

Walter Butler 1 - -

Philippe Capron 6 - -

Adeline Challon-Kemoun 4 - -

Anne Lange 6 - 3

Marie-Christine Levet 6 6 -

Jean Mounet 5 - 3

Total number of meetings 6 6 3

The Board of Directors is responsible forapproving the Company’s overall strategyproposed by the Chairman, authorisingsignificant projects and ensuring that thereare adequate resources to attain itsobjectives. It is entrusted withdecision-making outside the scope ofday-to-day management.

The Board of Directors entrusts theCompany’s operational management to theExecutive Committee, within the limits ofthe powers stipulated in the Internal Rulesof the Executive Committee. It also entruststhe day-to-day management to the ChiefExecutive Officers or, if applicable, theManaging Directors.

that a clear and effective managementstructure is implemented.

The Board appoints the members of theExecutive Committee, the Audit andCompensation Committees and the ChiefExecutive Officer(s), and generally ensures

It also oversees the quality of themanagement duties performed and ensuresthat they are consistent with the Group’sstrategic objectives. To that end, it receivesinformation every quarter including thebudget and revisions thereto, a consolidatedsummary of the quarterly report and anyother information it deems useful.

The Board may only validly debate and takedecisions if at least half of its members arepresent or represented. Decisions areadopted on the basis of a majority of votes.In the event of a split decision, the personchairing the meeting has the deciding vote.In exceptional circumstances, when urgencyand the best interests of the Company sodictate, decisions may be adopted pursuantto the unanimous consent of the Directors,



expressed in writing. However, thisprocedure may not apply in relation to theapproval of separate financial statementsfinancial statements and the issuance ofauthorised capital.

COMMITTEES CREATED BY 5.5.3.THE BOARD OF DIRECTORS

Pursuant to the Bylaws, the Board ofDirectors is authorised to set up specificCommittees and to determine their tasksand operating rules.

Executive Committee5.5.3.1.

The Board of Directors has set up anExecutive Committee, whose creation wasratified by shareholders at the ExtraordinaryGeneral Meeting of 18 May 2004.

Following the transformation of Econocomgroup into a European Company, theBoard of Directors revised the InternalRules of the Executive Committee on19 May 2016 and 7 September 2016.

The Board entrusted the ExecutiveCommittee with Econocom’s operationalmanagement, in accordance with article 15section 18 of the new Belgian CompaniesCode and article 21 of the Bylaws.

The role of the Executive Committee is torecommend strategic guidelines for theGroup, implement the strategy chosen bythe Chairman and approved by the Board ofDirectors, approve the budgets accordingly,manage the Group’s operationaldepartments (within the scope of thepowers of their governing bodies) andmonitor their financial and operatingperformance.

Jean-Louis Bouchard, Angel Benguigui andBruno Grossi, Eric Bazile, Eric Lucas, PhilippeGoullioud, Laurent Roudil, Laurent Caparrosand Chantal de Vrieze effective 11 February2019.

The composition of the ExecutiveCommittee was modified several timesduring the year. The Board of Directorsappointed a new Executive Committee on28 January 2019. As at 31 December 2019, itwas composed of the following members:

The Executive Committee meets at leastten times a year.

Compensation Committee5.5.3.2.

On 31 August 2011, the Board of Directors setup a Compensation Committee.

The role of the Compensation Committee isto advise and assist the Board of Directorswith respect to its compensation policy. It isalso charged with implementing plans forgranting financial instruments (free shares,stock options, etc.). It drafts thecompensation report, in accordance witharticle 3, section 6 of the Belgian CompaniesCode, which is subsequently appended tothe corporate governance statement. Oneof its members will comment on the reportat the Ordinary General Meeting.

The Board of Directors has also granted theCompensation Committee, in accordancewith article 21 of the Bylaws,decision-making powers on behalf of theBoard of Directors with respect to stockoption plans or any other plans for grantingfinancial instruments. In this respect, theCompensation Committee replaces theStock Option Committee set up inFebruary 2003. As from 23 January 2020it became the Compensation andNominations Committee.

The Committee has three membersappointed by the Board of Directors forthree-year terms that cannot exceed theirterm as Directors. As at 31 December 2019 itconsisted of the following members: JeanMounet, Rafi Kouyoumdjian and AnneLange.

The Committee met three times in 2019.



Audit Committee5.5.3.3.

The Audit Committee was created by theBoard of Directors on 18 May 2004.

As of 31 December 2019, two of its membersare non-executive Directors and one is anindependent Director. The Committee ischaired by Gaspard Dürrleman.

The term of office is three years, providedthat it does not exceed the holder’s term ofoffice as Director.

The Audit Committee meets as often asrequired. It met six times in 2019, with allmembers in attendance (as stated insection 5.5.2 above), an executive Director,the Company Secretary, Éric Bazile, GroupFinancial Controller, and the head of InternalAudit. The members of the AuditCommittee invite the Statutory Auditor andany other person deemed useful by theCommittee as required by the agenda.

The Audit Committee is responsible forhelping the Board of Directors perform itsduty of controlling Econocom group’soperations. In particular, it examines thequality and relevance of internal andexternal audit engagements, monitorsinternal control and risk managementprocedures, ensures that the accountingpolicies used are appropriate, and that theGroup’s financial data are complete andaccurate.

Article 3:6 of the new Belgian CompaniesCode stipulates that companies must beable to demonstrate the independence andaudit and accounting expertise of at leastone of the members of the AuditCommittee. Econocom complies with thisrequirement.

DAY-TO-DAY MANAGEMENT5.5.4.

The Board of Directors has entrusted theday-to-day management of the Econocomgroup to the Chief Executive Officers, inaccordance with articles 15, section 18 and 7,section 121 of the new Belgian CompaniesCode.

All major decisions regarding thesubsidiaries are made by the relevant body,with the assent of the Chief ExecutiveOfficer in charge of the issue or activity inquestion. The subsidiaries generally do nothave any major decision-making powersother than those concerning day-to-daymanagement. The powers of Groupsubsidiaries’ managers and the limits tothese powers are set out in an internalreference document.

The Executive Committee is in charge ofoperational management.

IMPLEMENTATION OF 5.5.5.PROVISIONS GOVERNING CONFLICTS OF INTEREST

Article 7:96 of the new Belgian CompaniesCode provides for a specific procedurewithin the Board of Directors to addressconflicts of interest involving one or moreDirectors when it makes decisions orconcludes transactions.

At its meeting of 22 November 2012, theBoard of Directors also adopted a proceduregoverning transactions or other contractualrelationships between Econocom group andthe Directors and members of the ExecutiveCommittee when such transactions or othercontractual relationships are not covered bythe provisions of article 7:96 of the newBelgian Companies Code.

Articles 7:96 and 7:97 of the new BelgianCompany Code were not applied in 2019,nor was the Group’s conflict of interestprocedure.



IMPLEMENTATION OF 5.5.6.THE DIVERSITY PROJECT

Econocom’s commitments, objectives andactions in respect of diversity, as well as theresults of this policy, are described inparagraph 1.1.4 of chapter 3, (“CorporateSocial Responsibility”). They mainly concerngender equality and support for people fromdisadvantaged backgrounds and peoplewith disabilities.

Since 23 November 2017, one-third of themembers of Econocom group’s Board ofDirectors have been women, pursuant to theconditions set out in article 7, section 86 ofthe Belgian Companies Code. At31 December 2019, the Board had fourwomen members: Véronique di Benedetto,Adeline Challon-Kemoun, Anne Lange andMarie-Christine Levet. Women also sit oneach of the various Committees created bythe Board of Directors, namely the ExecutiveCommittee (Chantal De Vrieze), the AuditCommittee (Marie-Christine Levet) and theCompensation Committee (Anne Lange).

Econocom’s policy in favour of people fromdisadvantaged backgrounds is deemed* notto be designed for the Group’s senior staff.Despite having made particular efforts inthis regard, Econocom has not yet hired asenior manager with a disability.

Composition of 5.6.advisory bodiesEconocom group’s Statutory Auditor isPricewaterhouseCoopers Réviseursd’Entreprises SRL (Woluwe Garden,Woluwedal, 18 1932 Saint Stevens Woluwe[Belgium]). Its term was renewed at theMay 2019 Annual General Meeting andexpires at the May 2021 Annual GeneralMeeting.

Econocom group’s Statutory Auditor isrepresented by Alexis Van Bavel, companyauditor.

2019 Compensation 5.7.reportThis report was drafted in accordance withthe provisions of articles 7:100 and 3:6section 3 of the new Belgian CompaniesCode. Its purpose is to describe in detail thepolicy for compensating Directors (executiveand non-executive), as well as members ofthe Executive Committee of Econocomgroup.

COMPENSATION POLICY 5.7.1.FOR DIRECTORS AND MEMBERS OF THE EXECUTIVE COMMITTEE

Procedure adopted to define 5.7.1.1.compensation for Directors and members of the Executive Committee and set their individual compensation

On 31 August 2011, the Board of Directors setup a Compensation Committee. TheCommittee comprises three non-executiveDirectors, two of whom are independent asdefined in article 7:87 section 1 of the newBelgian Companies Code. The role of theCompensation Committee is to advise andassist the Board of Directors with respect toits compensation policy. It is also chargedwith implementing plans for grantingfinancial instruments (free shares, stockoptions, etc.).

More specifically, the CompensationCommittee is in charge of:

upon recommendations of the1°)Chairman and Chief Executive Officer:

a) making proposals and recommendationsto the Board of Directors with respect to thepolicy for compensating Directors andmembers of the Executive Committee and, ifrequired by law, any resultingrecommendations which the Board ofDirectors must submit to the shareholdersfor approval,

Before amortisation of intangible assets from acquisitions.*


05management reportorporate governance statement

b) making proposals and recommendationsto the Board of Directors with respect to theindividual compensation of Directors andmembers of the Executive Committee,including the variable portion and long-termbonuses (long-term share incentives) –whether or not shared-based – granted asstock options or other financial instruments,termination benefits and, if required by law,any resulting recommendations which theBoard of Directors must submit to theshareholders for approval,

c) making proposals and recommendationsto the Board of Directors about setting andassessing performance targets linked to theindividual compensation of Directors andExecutive Committee members appointedby the Board of Directors;

drafting the compensation report, in2°)accordance with article 3:6 section 3 of thenew Belgian Companies Code, which issubsequently added to the corporategovernance statement;

commenting on the compensation3°)report during the Ordinary GeneralMeeting;

submitting recommendations to the4°)Board of Directors with respect to theprocedure and conditions concerning theDirectors’ and Chairman’s Councilmembers’ contracts;

generally carrying out all the tasks5°)assigned by the Board of Directors withrespect to compensation.

future plans for granting financialinstruments such as warrants or free shares,i.e., issuing stock options or other financialinstruments within the limits authorised bythe Board of Directors, to whom theCompensation Committee is accountable.

In accordance with article 21 of the Bylaws,the Board of Directors also grants theCompensation Committee the power toimplement Board decisions with respect tostock option plans or any other existing or

The Compensation Committee met thricein 2019.

2019 compensation policy5.7.1.2.

Board of Directors

The Bylaws provide for attendance fees forDirectors.

The Extraordinary General Meeting of18 December 2015 decided to increase thecompensation of non-executive Directorsfrom €3,000 to €5,000 per Board meetingfrom January 2016, subject to actualattendance at meetings.

Executive Directors do not receive anycompensation in respect of theirdirectorships for Econocom Group. Theircompensation comes from contractualrelationships or their terms of office with oneor more Group companies; At its meeting of24 November 2016, the Board of Directorsclarified the status of executive Director,excluding from the concept Directors havingan operational function within subsidiariesbut not holding executive positions atEconocom group. People in this position areconsidered to be non-executive Directors.However, they do not receive attendancefees.

Directors not exercising any operationalfunction do not receive any compensationother than the above-mentionedattendance fees.



A summary of the nature of the compensation paid to Directors is as follows:

Terms of office at 31 Dec. 2019 Nature of compensation

Jean-Louis BouchardChairman and Chief

Executive Officer

No direct compensationfor services provided by

the holding companyEIBV

Robert BouchardVice-Chairman

non-executive DirectorAttendance fees

Bruno Grossi Managing directorCompensation received

as an employee

Jean-Philippe RoeschExecutive then

non-executive Director

Consultancy provided tothe company Orianisa

Consulting andcompensation received

as an employee, plusattendance fees

Véronique di Benedetto Non-executive DirectorCompensation received

as an employee

Gaspard Dürrleman Non-executive Director Attendance fees

Rafi Kouyoumdjian Non-executive Director Attendance fees

Walter Butler Independent Director Attendance fees

Philippe Capron Independent Director Attendance fees

Adeline Challon-Kemoun Independent Director Attendance fees

Anne Lange Independent Director Attendance fees

Marie-Christine Levet Independent Director Attendance fees

Jean Mounet Independent Director Attendance fees

Committees

At the Extraordinary General Meeting of Compensation Committees was increased18 December 2015, the compensation of from €2,000 to €3,000 per meeting fromChairs and members of the Audit and January 2016, subject to actual attendance.



Executive Directors, non-executiveDirectors with operational functions andmembers of the Executive Committee

The compensation of executive Directorsand members of the Executive Committeeappointed by the Board of Directors is set bythe Chairman and Chief Executive Officer,based on advice from the CompensationCommittee.

The compensation of executive Directorsand members of the Executive Committeeincludes a significant variable portion, whichaccounts for between 20% and 50% of thetotal compensation. At the ExtraordinaryGeneral Meeting of 28 September 2011, theBoard of Directors was granted anexemption from article 7:91, paragraph 2 ofthe new Belgian Companies Codepertaining to the rules governing thedistribution of the variable portion ofcompensation for 2011 and 2012. At theAnnual General Meeting of 21 May 2013, thisexemption was renewed indefinitely. Thevariable portion of compensation paid toexecutive Directors and ExecutiveCommittee members was set in 2019 basedon annual performance criteria.

executive Director, and depend on thescope of their duties and responsibilities.

2019 variable compensation paid toexecutive Directors and members of theExecutive Committee was subject to theachievement of objectives, both qualitativeand quantitative. A significant proportion ofcompensation paid to members of theExecutive Committee was subject to theachievement of a joint quantitativeobjectives relating to the Group's budgettargets, and in particular recurring profit,revenue and the net debt of the Group andor areas of responsibility specific to eachmanager. The other qualitative andquantitative objectives are specific to eachExecutive Committee member and

As is the case with all Econocom groupemployees, the executive Directors andExecutive Committee members who areemployees of the Group, are assessed on acontinuous basis throughout the year bytheir managers and at the annual appraisal,which is held in the first quarter of thefollowing year.

The compensation of non-executiveDirectors with operational functions is set bythe Chairman or a member of the ExecutiveCommittee.

The compensation policy for 2020 isconsistent with the compensation policy for2019. Compensation includes a variablecomponent of at least 30% of totalcompensation. The variable compensation ofexecutive Directors, non-executive Directorswith operational functions and ExecutiveCommittee members is subject to theachievement of qualitative and quantitativeobjectives specific to each person, based ontheir duties and responsibilities. Theseobjectives concern the (I) results (revenueand profit before tax) of the Group and of theactivity for which they are responsible,(II) revenue targets or development targetsin strategic market segments or offers forthe Group, targets relating to productivityand compliance with financial ratios,including working capital requirements andnet debt, and lastly, (III) qualitativeobjectives, based in particular on qualityindicators.

The Board of Directors did not deem itnecessary, given the reliability of theGroup’s financial information, toimplement a system for retrieving variablecompensation granted on the basis ofincorrect financial information.



COMPENSATION PAID IN 20195.7.2.

Non-executive Directors5.7.2.1.

This section sets out the individualcompensation and benefits paid directly orindirectly to non-executive Directors byEconocom group or any of the Group’s othercompanies in 2019.

Compensation paid in 2019, includingpayroll costs

in €

Walter Butler 5 000

Philippe Capron 30 000

Adeline Challon-Kemoun 20 000

Gaspard Dürrleman 48 000

Rafi Kouyoumdjian 46 000

Anne Lange 39 000

Marie-Christine Levet 48 000

Jean Mounet 34 000

Jean-Philippe Roesch 5 000

Robert Bouchard 25 000

Total 300 000

5.7.2.2. Compensation paid to theChairman of the Board of Directors

subsidiaries for managing and coordinatingthe Group. These fees amounted to€2.3 million in 2019, compared with€2.7 million in 2018.

Jean-Louis Bouchard performs the duties ofChairman of the Board of Directors, ChiefExecutive Officer and Chairman of the Group’sExecutive Committee. He receives nocompensation whatsoever for these duties,and does not benefit from any special pensionor insurance, or any other benefits paid eitherdirectly or indirectly by either Econocomgroup or any companies in the scope ofconsolidation. Econocom International BV –whose Chairman is Jean-Louis Bouchard –bills fees to Econocom group and its

Three-quarters of this amount is composedof employee benefits expenses and theremainder of chargebacks of costs incurredby EIBV on behalf of Econocom(management seminars, etc.).

Total compensation paid to 5.7.2.3.the executive Directors of the Board of Directors, non-executive Directors with operational functions and members of the Executive Committee in 2019

This section sets out the overallcompensation and benefits paid directly orindirectly to executive Directors of the Board,non-executive Directors with operationalfunctions and members of the ExecutiveCommittee by Econocom group or any ofthe Group’s other companies in 2019.

Total compensation paid in 2019,including payroll costs

in €

Fixed portion(1) 3,700,251

Variable portion(2) 1,461,061

Pensions and other compensation, including benefits in kind(3)

2,495,095

Payroll costs(4) 1,733,059

Attendance fees

Total 9,389,466Of which €67 thousand in respect of 2018 and prior(1)

years and paid in 2019.Of which €1,125 thousand in respect of 2018 and(2)

prior years and paid in 2019.Of which €537 thousand in respect of 2018 and prior(3)

years and paid in 2019.of which €307 thousand for 2018 and prior years,(4)

and paid in 2019.



Total compensation for 2019, includingpayroll costs

in €

Fixed portion(1) 3,729,418

Variable portion(2) 2,176,833

Pensions and other compensation, including benefits in kind(3)(4)

889,374

Payroll costs(5) 1,947,404

Attendance fees

Total 8,743,029Of which €29 thousand in respect of 2019 and paid(1)

in 2020.Of which €1,840 thousand remaining to be paid in(2)

2020. The non-finalised variable portions wererecorded on the assumption that 100% of targetswere met.Of which €889 thousand yet to be paid in 2020.(3)

Of which €313 thousand in respect of departure(4)

transactions.Of which €644 thousand yet to be paid in 2020.(5)

This information refers to compensationincluding payroll costs paid to executiveDirectors and Executive Committeemembers in office in 2019, as well ascompensation paid to non-executiveDirectors with operational functions, namelyVéronique di Benedetto.

Eleven of the managers with operationalfunctions were compensated under theiremployment contract as employees ofEconocom group’s companies. Fiveindirectly received compensation through acompany controlled by Econocom group, asa corporate officer of an Econocom groupcompany and/or as a service provider. Thislump-sum compensation is included in thesummary table above.

Lastly, the compensation paid to Jean-LouisBouchard, Chairman of the Board ofDirectors, Chief Executive Officer andChairman of the Executive Committee, is setout in section 5.7.2.2.

Six of the executive Directors, ExecutiveCommittee members and non-executiveDirectors with operational functions have acompany car.

Stock options and free 5.7.2.4.shares granted

Some of the executive Directors, ExecutiveCommittee members and non-executiveDirectors with operational functions benefitfrom stock option and/or performance shareplans.

Moreover, the Annual General Meeting of17 May 2016 approved the terms of a freeshare plan involving 1,125,000 shares (or2,250,000 shares after the share split). At itsmeeting of 19 May 2016, the Board ofDirectors awarded 220,000 (440,000 aftershare split) of those free shares to oneexecutive Director and member of theExecutive Committee, of which 70,000(140,000 after share split) vested in 2017,80,000 (160,000 after share split) in 2018, and35,000 (70,000 after share split) in 2019; theremainder of those shares (35,000, or 70,000after share split) was lost as a result of afailure to meet performance conditions. Atits meeting of 26 February 2018, the Board ofDirectors awarded 15,000 of those freeshares to one member of the ExecutiveCommittee; 15,000 shares vested in 2019.

At 31 December 2019, the executiveDirectors, Executive Committee membersand non-executive Directors held1,137,157 stock options entitling them to2,274,314 Econocom group shares (after theshare split) at a total subscription price of€6.6 million, as well as 750,000 Econocomgroup performance shares.



Termination benefits and 5.7.2.5.other contractual obligations

The employment contracts of the executiveDirectors, Executive Committee membersand non-executive Directors with operationalfunctions in office at 31 December 2019contain standard clauses, in particular asregards notice period. They contain nospecific clause with respect to pensionbenefits. Three members of the ExecutiveCommittee receive a specific terminationbenefit (under certain conditions)

Appropriation of 5.8.profit and dividend policyAt the Annual General Meeting to be held on21 May 2019, the Board of Directors willrecommend that shareholders receive arefund of the issue premium, considered aspaid-up capital, in the amount of €0.12 pershare.

This refund represents stability in the grossshareholder compensation per share overthe last two years.

In addition, the Group will also continue itsshare buyback policy.

Relations with major 5.9.shareholdersOn 12 November 2019, Econocom groupreceived notification of a threshold crossingfrom Econocom International BV, the SCI ofDion Bouton and Econocom group statingthat they held 45.04% of the Company'scapital. This crossing above of the 45%threshold results from successive buybacksof shares in the Company by Econocomgroup SE as part of its share buybackprogramme authorised by the GeneralShareholders' Meeting of 21 May 2019.

At 31 December 2019, the number of sharesissued by Econocom group totalled245,380,430, of which Jean-Louis Bouchardheld 36.40% via Econocom International BVand SCI de Dion Bouton. Shares held intreasury by Econocom group do not carryvoting rights, meaning that, at 31 December2019, Jean-Louis Bouchard held 40.25% ofthe Company’s voting rights, directly andindirectly (excluding treasury shares heldunder the liquidity agreement).

Relations with the majority shareholder,Econocom International BV, correspond tothe provision of standard services onarm’s-length terms. In addition, theEconocom group signed lease agreementsin France with companies controlled byJean-Louis Bouchard: SCI Maillot Pergolèse,SCI of Dion Bouton and SCI JMB. Theseleases were signed on arm's length terms.

Econocom group 5.10.employee share ownershipThe Group has set up several incentive plansfor its personnel, employees, managers andexecutives. Three stock option plans set upin 2013, 2014 and 2017 are still in progressand have given rise to awards each yearsince 2013 and a free share allocation planapproved by the Annual General Meeting inMay 2016 has given rise to awards in 2016and 2018.

During the year, 85,000 free shares weretransferred to the beneficiaries of this plan,resulting in the transfer of an equivalentnumber of treasury shares, and120,000 options relating to the 2014 stockoption plan were exercised by onebeneficiary, resulting in the issuance of240,000 free shares.



An updated summary of the Group’s commitments in respect of these plans at31 December 2019 is provided below:

Plan Grant year

Numberof

optionsand free

shares

Number ofcorres-

pondingshares*

Expiry dateExercise

price(in € per

option)

Exerciseprice

(in €thousands)

Options 2013 250,000 500,000 Dec. 2020 5.96 1,490

2014 subscription options

2014 1,599,620 3,199,240 Dec. 2021 5.52 8,830

2015236,800 473,600 Dec. 2022 7.74 1,833

120,000 240,000 Dec. 2022 7.61 913

201640,000 80,000 Dec. 2023 9.57 383

45,000 90,000 Dec. 2023 13.60 612

2017 subscription options

2017 90,000 90,000 Dec. 2023 6.04 544

Free shares 2018

197,500 197,500 March 2020 - -

197,500 197,500 March 2021 - -

197,500 197,500 March 2022 - -

197,500 197,500 March 2023 - -

Total - - 5,462,840 - - 14,605

Each one of the options granted prior to the two-for-one share split (in June 2017) entitle the holder to two*

Econocom Group shares.



These plans cover Econocom group shareslisted on the Euronext Brussels stockexchange. They are granted with a view toinvolving employees, managers andexecutives more closely in the Group’soperations and business development.

The granting of some of the stock optionsand free shares, comprising between 50%and 100% of the stock options and sharesallocated, is contingent on theirbeneficiaries achieving individual, collective,internal and/or external performance goals.The exercise price is set in accordance withcurrent legislation.

The options may not be transferred andEconocom group does not hedge itsexposure to decreases in the share price.

The options awarded in 2013 were and willbe covered by existing shares.

The stock options granted in 2014, 2015 and2016 are part of a stock option planapproved by the Board of Directors on17 December 2014. If exercised, theseoptions will result in the issuance of newshares.

Meeting of 17 May 2016. The differentawards made as part of this plan wereapproved by the Board of Directorsmeetings dated 19 May 2016, 26 February2018 and 27 December 2018. The vesting offree shares by the beneficiary will result indelivery of existing shares.

The free share plan issued in 2016 wasapproved by the General Shareholders'

The stock options granted in 2017 are partof a stock option plan approved by theBoard of Directors on 22 June 2017. Ifexercised, these options will result in theissuance of new shares.

At 31 December 2019, unexercised freeshares and options entitling their holders toa total of 5,462,840 Econocom group shares,including 4,172,840 shares yet to be issuedand 1,290,000 existing shares. Theyrepresented 2.23% of the number of sharesoutstanding at the end of the year. Lastly, ofthe total number of shares corresponding tostock options and free shares granted andnot yet exercised, 11.12% were subject to theachievement of quantitative and/orqualitative, and individual and/or collectiveperformance conditions.

The exercise of all these options wouldresult in an equity increase of €14.6 million.



Statutory auditor's fees5.11.in € 31 Dec. 2019 31 Dec. 2018

Statutory Auditor’s fees for auditing the consolidated financial statements 353,648 430,848

Statutory Auditor fees or fees for similar assignments performed in the Group by individuals related to the Statutory Auditor

841,490 874,400

Fees for non audit-related engagements or specific assessments carried out by the Statutory Auditor for Econocom group

- -

Non-audit certification engagements 21,500 -

Tax advisory work - -

Other external audit-related assignments 73,000 -

Fees for one-off tasks or specific assessments carried out for Econocom group by persons related to the Statutory Auditor(s)

- -

Non-audit certification engagements 33,150 0

Tax advisory work 198,991 252,401

Other external audit-related assignments 356,500 0

Treasury shares5.12.See section 2.3.3 above.


05 management reportsubsequent events

Subsequent events6.As of 1st January 2020, Anne Lange, RafiKouyoumdjian and Jean Mounet steppeddown as directors.

On 10 February 2020, Econocom Group wasinformed an agreement had been enteredinto under the terms of which EconocomInternational BV undertook to purchase the5.4% equity interest (i.e. 13,278,091 shares)held in Econocom Group SE by twocompanies controlled by Walter Butler. Theselling price agreed was €3 per EconocomGroup SE share. The sale is subject to theusual condition precedent that EconocomInternational BV obtains a bank loan for thefull purchase price.

On 28 February 2020, Econocomannounced it had entered exclusivenegotiations with the Chequers Capitalinvestment company with a view todisposing of its subsidiary EconocomBusiness Continuity which is responsiblefor all maintenance activities in France. Thisplanned disposal is part of its strategy torefocus its activities, announced andembarked upon in 2019. The disposal issubject to the approval of the competitionauthorities.

In order to face the COVID-19 pandemicand ensure the continuation of activity, theGroup adopted relevant measures and isgradually adapting these over time. Theconsequences of this pandemic did nothave a significant effect on EconocomGroup's business in January and February2020. Its rapid spread across Europe and inparticular, Italy, Spain and France, since thebeginning of March, has led Econocom toanticipate an ongoing uncertain impact onits first quarter revenue in 2020. Part of theprojected decline may only translate into adeferral to the second quarter if thelock-down measures are not furtherrenewed beyond the end of April. At thisstage, it is still quite difficult to measure theimpact on the full year of 2020. However,regarding the financial position for the yearended 31 December 2019, the Groupbelieves that the consequences of thehealth crisis did not have a significantimpact and do not call into question theassumptions and estimates used for thisclosing.


06consolidated financial statements

Consolidated income statement 1.and earnings per share 148

Consolidated statement of 2.financial position 150

Consolidated statement of 3.changes in equity 152

Consolidated statement of cash 4.flows 154

Notes to the consolidated 5.financial statements 156


06 consolidated financial statementsconsolidated income statement and earnings per share

Consolidated income statement 1.and earnings per shareFor the years ended 31 December 2019 and 31 December 2018

in € millions Notes 2019 2018restated*

Revenue from continuing operations 4.1 2,926.6 2,999.9

Operating expenses (2,802.5) (2,892.3)

Cost of sales (2,068.4) (2,116.2)

Personnel costs 4.2 (521.3) (545.8)

External expenses** 4.4 (158.1) (187.0)

Depreciation, amortisation and provisions** 4.5 (47.4) (27.6)

Net impairment losses on current and non-current assets 4.6 (7.3) (14.6)

Taxes (other than income taxes) (9.2) (11.7)

Other operating income and expenses 4.7 4.5 8.2

Financial income – operating activities 4.8 4.7 2.5

Profit (loss) from continuing operations before amortisation of intangible assets from acquisitions 126.2 110.9

Profit (loss) from continuing operations 124.2 106.7

Other non recurring-operating income and expenses 5 (24.8) (19.9)

Operating profit 99.4 86.8

Other financial income and expenses 6 (19.2) (15.5)

Profit before tax 80.2 71.2

Income tax expense 7 (22.3) (20.8)

Profit from continuing operations 57.9 50.4

Share of profit (loss) of associates and joint ventures - -

Profit (loss) from discontinued operations 2.2.5 (9.2) (5.9)

Profit for the period 48.6 44.6

Non-controlling interests 3.9 5.2

Profit for the period attributable to owners of the parent 44.7 39.4

Recurring profit attributable to owners of the parent(1) 72.1 62.4


06consolidated financial statementsconsolidated statement of comprehensive income

Earnings per share attributable to owners of the parent (in €) Notes 2019 2018

restated*

Basic earnings per share – continuing operations 0.24 0.19

Basic earnings per share – discontinued operations 2.2.5 (0.04) (0.03)

Basic earnings per share 8 0.20 0.17

Diluted earnings per share – continuing operations 0.23 0.19

Diluted earnings per share – discontinued operations 2.2.5 (0.04) (0.02)

Diluted earnings per share 8 0.19 0.17

Recurring net earnings per share(1) 8 0.32 0.27In accordance with IFRS 5 (see 2.2.5), 2018 income and expenses of activities discontinued in 2019 are reclassified*

to the income statements of 2018 under "Profit (loss) of discontinued operations". However, in accordance withthe provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is not restated for the impact ofthis regulation on leases (see 1.1.1.1). In addition, the 2018 consolidated income statement is impacted by therecognition henceforth on the principal basis (within the meaning of IFRS 15) of direct deliveries (cf. 1.2.2.).

Changes in these two items came mainly from the introduction on 1 January 2019 of IFRS 16 on Leases (see 1.1.1.1).**

Recurring net profit attributable to owners of the parent has been the key performance indicator used by(1)

Econocom to assess its economic and financial performance. It does not include: amortisation of intangible assets from acquisitions, net of tax effects; •other non-recurring operating income and expenses, net of tax effects; •other non-recurring financial income and expense, net of tax effects; •profit from discontinued operations.•

A table showing the reconciliation of profit attributable to owners of the parent with recurringprofit attributable to owners of the parent is included in section 2.1 of the management report.

Consolidated statement of comprehensive incomein € millions 2019 2018

Profit for the period 48.6 44.6

Items that will not be reclassified to profit or loss 0.4 1.4

Remeasurements of the net liabilities (assets) under defined benefit plans 0.8 1.9

Deferred income tax expense on the remeasurement of the liabilities (assets) for defined benefit plans (0.3) (0.5)

Items that may be reclassified to profit or loss 0.4 (0.8)

Change in value of cash flow hedges (0.2) (0.9)

Deferred taxes arising on change in value of cash flow hedges - 0.3

Foreign currency translation adjustments 0.6 (0.2)

Other comprehensive income (expense) 0.8 0.6

Total comprehensive income for the period 49.4 45.2

Attributable to noncontrolling interests 3.9 5.1

Attributable to owners of the parent 45.5 40.1


06 consolidated financial statementsconsolidated statement of financial position

Consolidated statement 2.of financial positionAssets

in € millions Notes 31 Dec. 2019 31 Dec.2018*

Non-current assets

Intangible assets 10.1 57.2 83.4

Goodwill 9 512.9 631.1

Property, plant and equipment 10.2 34.6 48.6

Rights of use assets 10.2 57.9 -

Long-term financial assets 10.3 32.9 27.7

Residual interest in leased assets 11.1 131.9 122.4

Other long-term receivables 10.4 13.6 15.2

Deferred tax assets 7.2 37.4 33.8

Total non-current assets 878.6 962.3

Current assets

Inventories 12.1 60.1 52.1

Trade and other receivables** 12.2 1,093.7 1,268.6

Residual interest in leased assets 11.1 33.0 41.4

Current tax assets 18.1 10.2

Contract assets 12.2 30.6 31.3

Other current assets 12.2 27.8 34.9

Cash and cash equivalents 14.1 593.8 608.4

Assets held for sale 2.2.5 201.1 -

Total current assets 2,058.2 2046.9

Total assets 2,936.8 3,009.2

In accordance with the specifications of the standards, the 31 December 2018 statement of financial position is*

not restated for the impact of the application of IFRS 5 and 16 beginning in January 2019 (see 1.1.1.1).of which self-funded outstanding rentals: €238.5 million at 31 December 2019 versus €246.2 million at 31**

December 2018



Liabilities


Share capital 23.5 23.5

Additional paid-in capital and reserves 342.0 333.5

Profit for the period attributable to owners of the parent 44.7 39.4

Equity attributable to owners of the parent 15 410.2 396.4

Non-controlling interests 15.4 73.7 94.9

Total equity 483.9 491.3

Non-current liabilities

Bonds** 14.2 390.0 431.1

Financial liabilities** 14.2 61.6 73.0

Gross liability for purchases of leased assets 11.2 81.1 73.0

Long-term lease liabilities 37.7 -

Provisions 16 3.3 2.1

Provisions for pensions and other post-employment benefit obligations 17 37.4 45.1

Other non-current liabilities 12.5 42.4 69.9

Deferred tax liabilities 7.2 10.2 6.6

Total non-current liabilities 663.6 700.8

Current liabilities

Bonds** 14.2 51.5 6.4

Financial liabilities** 14.2 343.1 349.6

Gross liability for purchases of leased assets 11.2 20.4 25.1

Short-term lease liabilities 21.5 -

Provisions 16 32.6 41.6

Current tax liabilities 18.0 14.9

Trade and other payables 12.3 980.6 1,104.2

Contract liabilities 12.4 68.7 85.8

Other current liabilities 12.4 169.7 189.3

Liabilities held for sale 2.2.5 83.2 -

Total current liabilities 1,789.3 1, 817.1

Total equity and liabilities 2,936.8 3,009.2

In accordance with the specifications of the standards, the 31 December 2018 statement of financial position is*

not restated for the impact of the application of IFRS 5 and 16 beginning in January 2019 (see 1.1.1.1).After deduction of the €593.8 million of cash and cash equivalents posted to assets as at 31 December 2019**

(€608.4 million at 31 December 2018), net debt was €252.2 million at 31 December 2019 (€251.7 million at 31December 2018); this net debt includes €238.5 million at 31 December 2019 (€246.2 million at 31 December 2018)for self-funded TMF contracts and the anticipated rents from this activity.


06 consolidated financial statementsconsolidated statement of changes in equity

Consolidated statement 3.of changes in equity

in € millions Number ofshares

Sharecapital

Additionalpaid-incapital

Treasuryshares

Balance at 31 December 2017 245,140,430 23.5 253.0 (58.1)

Impact of IFRS 9 on impairment of receivables - - - -

Balance at 1 January 2018 245,140,430 23.5 253.0 (58.1)

Profit for the year - - - -

Other comprehensive income (expense), net of tax - - - -

Total comprehensive income for 2018 - - - -

Share-based payments - - - -

Refund of issue premiums/Payments to shareholders - - (29.4) -

OCEANE equity component - - 16.7 -

Net treasury share transactions - - - (6.5)

Put and call options on non-controlling interests - Change in fair value - - -

Put and call options on non-controlling interests - Initial recognition - - - -

Other transactions and transactions with an impact on non-controlling interests (see note 15) - - - -


in € millions Number ofshares

Sharecapital

Additionalpaid-incapital

Treasuryshares


IFRS impact on leases

Balance at 1 January 2019 23.5 240.3 (64.6)

Profit for the year - - - -

Other comprehensive income (expense), net of tax - - - -

Total comprehensive income for 2019 - - - -

Share-based payments - - - -

Refund of issue premiums/Payments to shareholders - - (27.4) -

Capital increase 240,000 - 0.7 -

Net treasury share transactions - - - (26.3)

Put and call options on non-controlling interests - Change in fair value - - - -

Put and call options on non-controlling interests - Initial recognition - - - -

Other transactions and transactions with an impact on non-controlling interests (see note 15) - - - -




Consolidatedreserves and

retained earnings

Othercomprehensive

income (expense)

Attributable toowners of the

parent

Attributable tonon-controlling

interestsTotal

equity

171.0 (8.6) 380.8 102.4 483.2

(3.2) - (3.2) - (3.2)

167.8 (8.6) 377.6 102.4 480.0

39.4 - 39.4 5.2 44.6

- 0.6 0.6 - 0.6

39.4 0.6 40.0 5.2 45.2

1.1 - 1.1 - 1.1

1.1 - (28.3) - (28.3)

- - 16.7 - 16.7

(5.9) - (12.4) - (12.4)

(10.3) - (10.3) - (10.3)

(10.3) - (10.3) 10.3 -

22.3 - 22.3 (23.0) (0.7)

205.2 (8.0) 396.4 94.9 491.3

Consolidatedreserves and

retained earnings

Othercomprehensive

income (expense)

Attributable toowners of the

parent

Attributable tonon-controlling

interestsTotal

equity

205.2 (8.0) 396.4 94.9 491.3

(3.0) - (3.0) - (3.0)

202.2 (8.0) 393.4 94.9 488.3

44.7 - 44.7 3.9 48.6

- 0.8 0.8 - 0.8

44.7 0.8 45.5 3.9 49.4

- 0.7 0.7 - 0.7

- - (27.4) - (27.4)

- - 0.7 - 0.7

- - (26.3) - (26.3)

3.2 - 3.2 - 3.2

- - - - -

20.5 - 20.5 (25.2) (4.7)

270.6 (6.5) 410.3 73.6 483.9


06 consolidated financial statementsconsolidated statement of cash flows

Consolidated statement 4.of cash flows


Profit from continuing operations 57.9 52.2

Elimination of share of profit (loss) of associates and joint ventures 18.1.1 - -

Provisions, depreciation, amortisation and impairment** 18.1.1 70.1 36.9

Elimination of the impact of residual interest in leased assets 18.1.1 3.2 (17.8)

Other non-cash expenses (income) 18.1.1 24.0 0.3

Cash flows from operating activities after cost of net debt and income tax 107.1 71.6

Income tax expense 7 17.8 21.2

Cost of net debt 18.1.2 15.2 12.9

Cash flows from operating activities before net borrowing cost and income tax (a) 140.1 105.7

Change in working capital (b), o/w: 18.1.3 15.3 41.2

Investments in self-funded TMF contracts 7.7 (39.0)

Other changes in working capital requirement 7.6 80.2

Tax paid before tax credits (c) (29.6) (27.0)

Net cash from (used in) operating activities (a + b + c = d) 18.1 125.8 119.9

Acquisition of property, plant and equipment and intangible assets (23.0) (43.1)

Disposal of property, plant and equipment and intangible assets 1.9 11.8

Acquisition of long-term financial assets (6.0) (5.0)

Disposal of long-term financial assets 0.7 1.9

Acquisition/disposal of companies and businesses, net of cash acquired/disposed (0.7) (13.1)

Net cash from (used in) investing activities (e) 18.2 (27.1) (47.5)In accordance with IFRS 5, the restatement of the 2018 figures reflects the reclassification of operations*

considered discontinued in 2019 to Net change in cash and cash equivalents from discontinued operations.However, in accordance with the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data isnot restated for their impact on leases (see 1.1.1.1).Includes €25.3 million in 2019 for the share of rental payments that is considered an amortisation of rights of use,**

in accordance with IFRS 16.




Issue of convertible bonds (OCEANE) - 183.3

Equity component (OCEANE) - 16.7

Exercise of stock options - 3.7

Capital increase 0.7 -

Purchases of treasury shares (net of sales) (26.0) (15.6)

Payments to shareholders during the period (27.5) (28.4)

Changes in refinancing liabilities on lease contracts and liabilities on self-funded contracts (6.9) (11.6)

Increase in financial liabilities 1.8 51.9

Decrease in financial liabilities (40.9) 39.5

Net change in commercial paper 23.6 152.9

Main components of payments coming from leases 26.9 -

Interest paid 16.0 (14.5)

Net cash from (used in) financing activities (f) 18.3 (118.0) 298.9Impact of exchange rates on cash and cash equivalents (g) 0.6 0.6

Net change in cash and cash equivalents from discontinued operations (h) 2.2.5 (10.5) -

Change in net cash and cash equivalents (d + e + f + g + h) (29.3) 372.0

Net cash and cash equivalents at beginning of period(1) 14.1/18 604.8 232.9

Change in cash and cash equivalents (29.3) 372.0

Net cash and cash equivalents at end of period(1) 14.1/18 575.6 604.8Net of bank overdrafts: €18.2 million at 31 December 2019 and €3.6 million at 31 December 2018.(1)

In accordance with IFRS 5, the restatement of the 2018 figures reflects the reclassification of operations*

considered discontinued in 2019 to "Net change in cash and cash equivalents from discontinued operations".However, in accordance with the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data isnot restated for the impact of this regulation on leases (see 1.1.1.1).

Key movements in the consolidated statement of cash flows are explained in note 18.


06 consolidated financial statementsnotes to the consolidated financial statements

Notes to the consolidated 5.financial statements

Basis of preparation1. 157Basis and scope of consolidation2. 164Segment reporting3. 173Profit (loss) from continuing operations4. 176Other non-recurring operating income and expenses5. 184Net financial expense6. 185Income tax7. 186Basic earnings per share8. 189Goodwill and impairment testing9. 191Intangible assets, property, plant and equipment and long-term financial assets10. 195Residual interest in leased assets and gross liability commitments for purchases 11.of leased assets 205Operating assets and liabilities12. 207Financial instruments13. 211Cash, gross debt and net debt14. 216Equity15. 222Provisions16. 230Provisions for pensions and other post-employment benefit obligations17. 232Notes to the consolidated statement of cash flows18. 237Risk management19. 241Off-balance sheet commitments20. 246Information on the transfer of financial assets21. 247Related-party information22. 250Subsequent events23. 253Assessments made by Management and sources of uncertainty24. 254


06consolidated financial statementsnotes to the consolidated financial statements

Basis of preparation1.The consolidated financial statements ofEconocom group (“the Group”) for the yearended 31 December 2019 include:

the Financial statements of Econocom•group SE;

the Financial statements of its•subsidiaries;

the share of the net assets and profit (loss)•of equity-accounted companies (jointventures and associates).

Econocom is an independent group thatdesigns, finances and oversees companies’digital transformation.

Econocom group SE, the Group’s parentcompany, is a European company (societasEuropaea) with its registered office at Placedu Champ de Mars, 5, 1050 Brussels.

The Company is registered with theBrussels companies registry undernumber 0422 646 816 and is listed onEuronext Brussels.

The Board of Directors Meeting of 9 March2020 adopted and authorised thepublication of the Consolidated financialstatements for the year ended31 December 2019. These financialstatements will only be deemed final oncethey have been approved by theshareholders at the Annual GeneralMeeting on 19 May 2020.

Accounting policies1.1.As required by European CommissionRegulation No. 1606/2002 dated 19 July2002, Econocom’s consolidated financialstatements for the 2019 fiscal year havebeen prepared in accordance with theInternational Financial ReportingStandards (IFRS) as published by theInternational Accounting Standards Board(IASB) and adopted by the European Union.

The accounting principles applied at31 December 2019 are the same as thoseused for the year ended 31 December 2018,except for the new standards andinterpretations applicable as of 1 January2019 (see 1.1.1.), and the changes inpresentation and methods (see 1.2.2.).

These financial statements do not take intoaccount any draft standards orinterpretations which, at the end of thereporting date, were being developed asexposure drafts by the IASB (InternationalAccounting Standards Board) or IFRIC(International Financial ReportingInterpretations Committee).

All the standards adopted by the EuropeanUnion are available on the EuropeanCommission website at the followingaddress:

https://ec.europa.eu/info/business-economy-euro/company-reporting-and-auditing/company-reporting/financial-reporting_fr#overview

https://ec.europa.eu/info/business-economy-euro/company-reporting-and-auditing/company-reporting/financial-reporting_fr#overview



STANDARDS, AMENDMENTS 1.1.1.AND INTERPRETATIONS ADOPTED BY THE EUROPEAN UNION AND APPLICABLE AT 1 JANUARY 2019

The standards, amendments to standardsand interpretations, published by the IASBand presented below are mandatory since1 January 2019.

The following standard had an impact onthe Group's financial statements:

IFRS 16 – Leases.•

The following standards did not have amaterial impact on the Group’s financialstatements:

Interpretation of IFRIC 23 – Uncertainty•over Income Tax Treatments;

Amendments to IFRS 9 – Prepayment•Features with Negative Compensation;

Amendments to IAS 28 – Long-Term•Interests in Associates and Joint Ventures;

Amendments to IAS 19 – Plan•Amendment, Curtailment orResettlement;

Amendments to IAS 1 and IAS 8 –•Modification of the definition of the term“material”;

Annual Improvements to IFRS 2015-2017:•

IFRS 3 and IFRS 11 – Recognition by▶Stage of a Business PreviouslyClassified as a Joint Venture;

IAS 12 – Tax Consequences of▶Dividends;

IAS 23 – Borrowing Costs.▶

IFRS 16 – Leases1.1.1.1.

IFRS 16 replaces IAS 17 and the relatedIFRIC and SIC interpretations andintroduces new rules of accounting forleases. Econocom is affected by thisstandard as both:

a lessor, as part of its TMF business; and•

lessee (premises and vehicles).•

Econocom functioning as a lessor

Virtually all of Econocom’s leasetransactions involving the Group as lessorrelate to finance leases, and Econocom actsas dealer lessor. In such cases, there are nochanges to the Group’s accounting policies.

Some sale and leaseback-type transactionswill be accounted for:

in accordance with IFRS 9 (to which•IFRS 16 refers) when the conditions forrecognising a sale within the meaning ofIFRS 15 between the lessee and Econocomare not met;

in accordance with IFRS 16 (direct finance•lease) if the transfer of the asset toEconocom by the lessee meets the criteriaset out in IFRS 15.

In both cases, Econocom recognises afinancial asset. Revenue is not recognisedat the transaction date and financialincome relating to operating activities isrecognised over the entire lease termbased on the interest rate implicit in thelease.

In the case of a sale without recourse to arefinancing institution of a sale andleaseback agreement, only thecorresponding margin is recognised at thedate of sale.



The main impact therefore relates tocertain non-recourse sale & leasebacktransactions for which the margin is spreadover the term of the agreement.

Econocom functioning as a lessee

The leases that fall within the scope ofIFRS 16 apply mainly to premises andvehicle rentals.

In accordance with IFRS 16, all leases arenow recognised on the assets side with therecognition of a right of use, and on theliabilities side with a liability correspondingto the discounted value of future payments.

The rental term is determined on alease-by-lease basis and corresponds to thefirm period of the commitment, taking intoaccount optional periods that arereasonably certain to be exercised, exceptfor vehicles for which Econocom will retainthe portfolio approach, throughsimplification, given that the contracts aresomewhat similar irrespective of thecountry and that this simplification doesgive rise to material differences with regardto the recommended method set forth inIFRS 16.

For vehicles, the assumptions andmeasurement methods of this “portfolio”approach are as follows: a measurement isdone at each period end, making it possibleto update the lease liability and right of use;amortisations and financial expenses arethen determined on a flat-rate basis basedon an average term of use of the vehicles(amortisation) and on the rental paymentsactually paid for the difference.

The accounting exemptions set out in thestandard for the short-term contracts (termbelow or equal to 12 months)– and leaseson low value assets, have been applied.

As with IAS 17, the lease durations areanalysed for each lease. The term takesaccount of the reasonably certain renewaland cancellation options.

The discount rate applied on the date oftransition is based on the Group’sincremental borrowing rate.

Following the application of IFRS 16, theGroup has recorded deferred taxes for thenet amount of deductible and taxabletemporary differences.

Presentation of the impacts 1.1.1.2.of the application of IFRS 16 on the financial statements as lessee

The Econocom group applies IFRS 16according to the simplified retrospectiveapproach, which means the impacts arerecorded in the opening statement offinancial position at 1 January 2019.Consequently, the 2018 financialstatements have not been restated.

Impacts on the consolidated incomestatement

In the 2019 consolidated income statement,occupancy expenses are distributedbetween amortisations of the right of use inprofit (loss) from continuing operations andfinancial expenses in financial income.

At 31 December 2019, the application of thestandard impacted the income statementfor:

-€25.3 million under "Depreciation,•amortisation and provisions";

+€26.9 million under "External expenses";•and

-€1.6 million under "Other financial•income and expenses".



Impacts on the consolidated financialposition

In the consolidated statement of financialposition, the right of use is recognised onthe non-current assets side and leaserequirements are recognised on theliabilities side.

At 31 December 2019, the application of thisstandard impacted the consolidatedfinancial position as follows:

€57.9 million under "Rights of use assets"•(compared with €67.1 million at 1 January2019);

€37.7 million under "Long-term lease•liabilities" (compared with €54.0 million at1 January 2019); and

€21.5 million under "Short-term lease•liabilities" (compared with €17.0 million at1 January 2019).

Impacts on the statement of cash flows

The statement of cash flows shows rentpayments as a decrease in lease liabilities.

At 31 December 2019, the application of thisstandard impacted the statement of cashflows as follows:

+€25.3 million under "Cash flows from•operating activities after cost of net debtand income tax";

+€1.6 million under "Cost of net debt" and•

-€26.9 million under cash flows from•(used in) financing activities.

Reconciliation table with lease commitments (IAS 17

in € millions

Operating lease liabilities at 31 December 2018 88.7

Leases dated after 1 January 2019 (4.6)

Rents of optional periods (2.2)

Payments for non-lease components (1.8)

Impact of discounting (4.3)

Finance lease liabilities +1.3

Calculation of variable rents (1.7)

Other (4.4)

Lease liabilities at 1 January 2019 71.0

Operating lease expense for 2018

In 2018, operating lease expenses totalled€33.6 million for the group overall(including rental charges of €23.8 million)and €9.8 million for the leases of vehiclesand other equipment.

Presentation of the impacts 1.1.1.3of the application of IFRS 16 on the financial statements as lessor

The Econocom group has been applyingIFRS 16 since 1 January 2019 according tothe simplified retrospective approach.Consequently, the 2018 financialstatements have not been restated.



In the consolidated income statement for2019, revenue was reduced by €25.6 millionwhile profit (loss) from continuingoperations was not affected. Theapplication of IFRS 16 to leases granted byEconocom in the 2018 financial year wouldhave reduced revenue by €71.9 million andprofit (loss) from continuing operations by€2.1 million.

The application of IFRS 16 had no impact onEconocom’s lessor operations in theconsolidated financial position or thestatement of cash flows.

IFRIC 23 – Uncertainty over 1.1.1.4Income Tax Treatments

IFRIC 23 clarifies the application of theprovisions set out in IAS 12 – Income Taxesin terms of recognition and measurementwhen there are uncertainties over incometax treatments:

professional judgement should be used to•determine whether each tax treatmentshould be considered independently orwhether some tax treatments should beconsidered together;

the most likely amount or the expected•value of the tax treatment should be usedfor accounting purposes.

The Group has not identified any significantimpact.

STANDARDS, AMENDMENTS 1.1.2AND INTERPRETATIONS NOT YET ADOPTED BY THE EUROPEAN UNION

Pending their definitive adoption by theEuropean Union, the Group has notanticipated the application of the followingstandards and interpretations:

Amendments to IAS 1 and IAS 8•Modification of the definition of the term“material”, the application of which ismandatory from 1 January 2020;

IFRS 17 Insurance contracts, the•application of which is mandatory from1 January 2021.

The Group is currently in the process ofassessing any impacts of the firstapplication of these texts.

Basis for preparation 1.2.and presentation of the consolidated financial statementsAll amounts in the Consolidated financialstatements are presented in € millions. Thefact that figures have been rounded off tothe nearest decimal point may, in certaincases, result in minor discrepancies in thetotals and sub-totals in the tables and/or inthe calculation of percentage changes.

BASIS FOR REPORTING1.2.1.

These accounting policies set out belowhave been consistently applied to allthe years presented in the financialstatements.

The financial statements were prepared ona historical cost basis, with the exception of:

certain financial assets and liabilities•which are measured at fair value;

non-current assets held for sale, which are•recognised and measured at the lower ofnet carrying amount and fair value lesscosts to sell as soon as their sale isdeemed highly probable. They are nolonger amortised once they are classifiedas assets (or a group of assets) held forsale.



CHANGES IN PRESENTATION 1.2.2.AND ACCOUNTING POLICIES

Outside the standards, amendments,interpretations adopted by the EuropeanUnion and applicable on 1 January 2019, theGroup has decided to change itsapplication of IFRS 15 for its directshipments.

When it comes to the treatment of directdeliveries, management needs to use itsjudgement and decide between the“agent” and “principal” basis.

By direct deliveries, we understand the saleof materials stored in the warehouses ofEconocom’s suppliers and shipped directlyto the end customer.

These flows were recognised on the agentbasis for the 2018 financial year andcomparative years.

The Econocom group:

contractually sets the prices paid by the•end client;

has the capacity to choose, up until the•last moment, whether to go ahead with adirect delivery;

is responsible to the end client for•acceptance of equipment;

is responsible for the management of•equipment returns if necessary;

it has been decided to account for directdeliveries of equipment on the principalbasis.

accounting method makes it easier tocompare Econocom’s figures with those ofits direct competitors in the distributionbusiness.

As set out in IAS 8, this change ofaccounting method can be appliedbecause it makes it possible to providemore reliable and relevant information onthe effects of transactions or events in thefinancial statements, the financial positionand performance or the cash flows of theentity. Insofar as its main competitorsalready account for these transactions onthe principal basis, this change of

In accordance with IAS 8, this change inaccounting method is retrospective for thewhole of the 2019 financial year, and forcomparative years.

The impact of this change in accountingmethod for the whole of the 2018financial year was +€373.6 million on items“Revenue from continuing operations” and“Costs of sales”. It relates exclusively to theDSS activity.

USE OF ESTIMATES AND 1.2.3.JUDGEMENTS

The preparation of Econocom group’sconsolidated financial statements requiresthe use of estimates and assumptions byManagement which may affect thecarrying amount of certain items in assetsand liabilities, income and expenses, andthe information disclosed in the notes tothe consolidated financial statements.These concern: (i) the definition of dealerlessor in the sale & leaseback contracts, thevaluation and useful lives of operatingassets, property, plant and equipment,intangible assets, goodwill and contingentconsideration, provisions for risks and otherprovisions associated with the business,and (ii) the assumptions used forcalculating obligations relating toemployee benefits, share-based payments,deferred taxes and financial instruments.The Group uses discount rate assumptions(based on market data) to estimate assetsand liabilities.

Group Management regularly reviews itsestimates and assumptions in order toensure that they accurately reflect bothpast experience and the current economicsituation.



Depending on how these assumptionschange, the items in future financialstatements may differ materially from thecurrent estimates. The impact of changesin accounting estimates is recognised inthe period in which the change occurredand all future affected periods.

The main assumptions used by the Groupare set out in the relevant sections in thenotes to the financial statements and inparticular in the following notes:

note 2 – Basis and scope of consolidation;•

note 4.1.1 – Revenue recognition:•accounting principles;

note 4.3 – Government grants;•

note 7 – Income tax;•

note 9.3 – Impairment tests and•impairment of goodwill;

note 11 – Residual interest in leased assets•and gross liability for purchases of leasedassets;

note 13 – Financial Instruments;•

note 15.3.1 – Share-based payments;•

note 16 – Provisions;•

note 17 – Provisions for pensions and other•post-employment benefit obligations.

The main accounting policies that requirethe use of estimates are described innote 24 – Assessments made byManagement and sources of uncertainty.



Basis and scope of consolidation2.

Accounting principles 2.1.related to the scope of consolidation

BASIS OF CONSOLIDATION2.1.1.

These consolidated financial statementsinclude the financial statements ofEconocom group SE and all thesubsidiaries it controls.

According to IFRS 10, an investor controlsan investee if and only if the investor has allof the following:

power over the investee, i.e., the ability to•direct the activities that significantly affectthe investee’s returns;

exposure to the investee’s variable•returns, which may be positive, in theform of a dividend or any other economicor negative benefit; and

the investor’s returns can be only positive•(e.g., dividends or any other economicbenefits), only negative or both positiveand negative.

The ability to use its power over theinvestee to affect the amount of theinvestor’s returns. The assets, liabilities,income and expenses of subsidiaries arefully consolidated in the consolidatedfinancial statements and the share ofequity and profit attributable tonon-controlling interests is presentedseparately under non-controlling interestsin the consolidated statement of financialposition and income statement.

All intragroup assets, liabilities, equity,income, expenses and cash flows arisingfrom transactions between entities withinthe Group are fully eliminated onconsolidation.

Investments in associates and jointventures are consolidated using the equitymethod. Under this method theinvestment is initially recognised at costand adjusted to recognise the Group’sshare of the post-acquisition profits orlosses and movements in othercomprehensive income. If the Group’sshare in an associate’s losses is greater thanits investment in that associate, the Groupceases to recognise its share in futurelosses. Additional losses are only recognisedif the Group is under a legal or constructiveobligation to do so or if it has madepayments on behalf of the associate.

BUSINESS COMBINATIONS 2.1.2.(AND GOODWILL)

Acquisitions of businesses are accountedfor using the acquisition method, inaccordance with IFRS 3. The cost of abusiness combination (or “considerationtransferred”) is calculated as the aggregateof the acquisition-date fair values of:

the assets transferred by the Group;•

the liabilities acquired by the Group from•the former owners of the acquiree; and

the equity interests issued by the Group•in exchange for control of the acquiree.



The Group may choose whether tomeasure non-controlling interests at fairvalue or at the non-controlling interest’sproportionate share of the acquiree’s netidentifiable assets.

Acquisition-related expenses are expensedas incurred.

Measuring business combinations (or goodwill)

The difference between the considerationtransferred and the acquirer’s share in thefair value of the identifiable assets andliabilities and contingent liabilities at theacquisition date is recognised in goodwillon a separate line in the financialstatements. These items may be adjustedwithin 12 months of the acquisition date(measurement period). Any contingentconsideration due is recognised at itsacquisition-date fair value and included inthe cost of the combination. Subsequentchanges in the fair value of contingentconsideration are taken to profit or loss.

Acquisitions carried out on favourable terms

If, after remeasurement, the net of theacquisition-date amounts of theidentifiable assets acquired and thefinancial liabilities assumed in a businesscombination exceeds the aggregate of theconsideration transferred, the amount ofany non-controlling interests in theacquiree, and the fair value of the Group’spreviously held interest in the acquiree (ifany), the excess is recognised immediatelyin profit or loss as a bargain purchase gain.

Measuring non-controlling (minority) interests

Non-controlling interests entitle theholders to a proportionate share of theentity’s net assets in the event ofliquidation. Consequently, for eachbusiness combination, non-controllinginterests can be initially measured:

at fair value, resulting in the recognition of•additional goodwill (the “full goodwill”method); or

at the non-controlling interest’s•proportionate share in the recognisedamounts of the acquiree’s net identifiableassets (the “partial goodwill” method).

Changes in ownership interest

The recognition of subsequent changes inownership interest (through acquisitions ofadditional interests or disposals) dependson the definition of the impact on thecontrol of the entity in question.

If control is not affected by the change inownership interest, the transaction isregarded as between shareholders. Thedifference between the purchase (or sale)value and the carrying amount of theinterest acquired (or sold) is recognised inequity.

If control is affected (as is the case, forexample, for business combinationsachieved in stages), the interest held by theGroup in the acquiree before the businesscombination is remeasured at fair valuethrough profit or loss.



Impairment of goodwill

Following initial recognition, goodwill ismeasured at cost less any accumulatedimpairment losses, determined inaccordance with the method described innote 9.3.

Goodwill impairment losses are recordedunder “Non-recurring operating incomeand expenses” within operating profit inthe consolidated income statement.

TRANSLATION OF FOREIGN 2.1.3.CURRENCIES

Functional currency and 2.1.3.1.presentation currency

The items in the financial statements ofeach Group entity are measured using thecurrency of the primary economicenvironment (or “functional currency”) inwhich the entity operates.

The consolidated financial statementspresented in this report were prepared ineuros, which is the Group’s presentationcurrency.

Recognition of foreign 2.1.3.2.currency transactions

For the purpose of preparing the financialstatements of each entity, foreign currencytransactions of subsidiaries (i.e., currenciesother than the entity’s functional currency)are recorded using the exchange ratesprevailing at the transaction date.

Monetary items denominated in foreigncurrencies are translated at the end of eachreporting period at the year-end rate.Foreign exchange gains and lossesresulting from this translation at year-endexchange rates, or arising on thesettlement of these monetary items, arerecognised in the income statement for theperiod in which they occur.

Non-monetary items denominated inforeign currencies and recognised at fairvalue are translated using the exchangerate prevailing at the date the fair valuewas determined. Non-monetary itemsdenominated in foreign currencies andmeasured at historical cost are notremeasured.

When a gain or loss on a non-monetaryitem is recognised directly in equity, the“currency” component of this gain or loss isalso recognised in equity. Otherwise, thiscomponent is recognised in profit or lossfor the period.

Translation of the financial 2.1.3.3.statements of foreign entities

The results and financial positions of theGroup’s entities with functional currenciesother than the presentation currency aretranslated into euros as follows:

statement of financial position items•other than equity are translated atthe year-end exchange rate;

income statement and statement of cash•flow items are translated at the averageexchange rate for the year;

all resulting exchange differences are•recognised under “Foreign currencytranslation adjustments” within othercomprehensive income.

LIABILITIES UNDER PUT AND 2.1.4.CALL OPTIONS ON NON-CONTROLLING INTERESTS

The Group may grant put options tonon-controlling shareholders of some of itssubsidiaries. The exercise price of theseoptions is generally measured based onfuture performance and profitability.



The Group initially recognises a liability inrespect of put options granted tonon-controlling shareholders of the entitiesconcerned. The difference between theGroup’s liability under put options and thecarrying amount of the non-controllinginterests is recognised as a deduction fromequity attributable to owners of the parent.Put options are remeasured each year; anysubsequent changes in the option relatingto changes in estimates or to theunwinding of the discount on the optionare also recognised in equity. Changes inthe liability under put options onnon-controlling interests are accounted forin line with the treatment applied upon theacquisition of noncontrolling interests.

ASSETS AND LIABILITIES 2.1.5.HELD FOR SALE AND DISCONTINUED OPERATIONS

IFRS 5 – Non-current Assets Held for Saleand Discontinued Operations requires aspecific accounting treatment andpresentation of assets held for sale anddiscontinued operations (corresponding tooperations that have been disposed of orclassified as held for sale).

A non-current asset or group of directlyrelated assets and liabilities, is classified as“held for sale” if its carrying amount will berecovered principally through a saletransaction rather than through continuinguse. For this to be the case, the asset (orasset group) must be available forimmediate sale in its present condition andits sale must be highly probable.Management must be committed to thesale and the sale should be expected toqualify for recognition as a completed salewithin one year of the date of classification.

from the moment they qualify as “assets (orgroup of assets) held for sale”. They arepresented on a separate line on the Groupstatement of financial position, withoutrestatement of previous periods.

These assets (or disposal group) aremeasured at the lower of their carryingamount and estimated sale price less coststo sell. These assets cease to be amortised

An operation discontinued, sold, or held forsale is defined as a component of an entitywith cash flows that can be clearlydistinguished from the rest of the entityand which represents a major, separate lineof business or area of operations. For allpublished periods, income and expenserelating to discontinued operations arepresented separately in the incomestatement under “Profit (loss) fromdiscontinued operations” and are restatedin the statement of cash flows.

Profit from discontinued operations

A discontinued operation is a componentwhich the Group has either disposed of orhas classified as held for sale, and which:

represents a separate major line of•business or geographical area ofoperations;

is part of a single, coordinated plan to•dispose of a separate major line ofbusiness or geographical area ofoperations; or

is a subsidiary acquired exclusively with a•view to resale.

Profit from discontinued operationsincludes:

the post-tax profit or loss of discontinued•operations generated up until the disposaldate, or until the end of the reportingperiod if the business was not disposed ofby the year-end;

the post-tax gain or loss recognised on•the disposal of continued operations thathave been disposed of by the year-end.



Changes in the scope 2.2.of consolidationEconocom group’s scope of consolidation ispresented in note 2.3, “Main consolidatedcompanies”.

ACQUISITIONS DURING 2.2.1.THE YEAR

There were no significant acquisitions in2019 financial year.

CHANGES IN OWNERSHIP 2.2.3.INTEREST

Infeeny and its subsidiary

In the first half of 2019, the Group exercisedits purchase options regarding twonon-controlling interests, increasing itsstake from 86.02% to 95.68%.

Mobis and its subsidiaries (Rayonnance)

The Group acquired an additional 8.92% ofshares, thus raising its interest to 93.92%,before selling all of its shares (see 2.2.7.)

Gigigo and its subsidiaries

The Group signed an agreement with thenon-controlling shareholders regarding theacquisition of the remaining shares. Thisraised its interest to 100%.

Synertrade and its subsidiaries

The Group, via its subsidiary DigitalDimension, acquired the remainingminority stake (10%) in July, thus increasingits stake to 100%.

Altabox

The Group acquired an additional 15.01%following the exercise of a put option,increasing the stake from 60.02% to 75.03%.

Alterway and its subsidiaries

The Group acquired an additional 3.01%stake following the exercise of a put option,increasing the stake from 61.34% to 64.45%.

JTRS

Econocom Group increased its stake in thecompany through the acquisition of sharesfrom a minority shareholder (5%). JTRSremains consolidated under the equitymethod.

There was no other significant companycreation.

CREATION OF COMPANIES2.2.4.

In 2019, the Group created a company,“Econocom Ré”, in order to improve themanagement (in coordination withinsurance companies) of the hedging ofcredit risks in its TMF business. It is fullyconsolidated, and 100% owned by theparent company, Econocom group.

No other material companies were createdin 2018.

ASSETS/LIABILITIES 2.2.5.CLASSIFIED AS HELD FOR SALE, DISCONTINUED OPERATIONS

In the first half of 2019, the Board ofDirectors identified a list of non-strategicoperations and entities for which it issuedsell orders. Given the progress in thisregard, it is anticipated that they will bedisposed of within 12 months.

For the most part, the entities belong tothe Digital Solutions & Services (DSS)business, primarily in France and Easternand Northern Europe, and to a lesser extentin Southern Europe.

In the second half of 2019, the Board ofDirectors completed this list with somenonstrategic activities and entitiesintended to be discontinued



Impacts on the income statement and statement of cash flows

As of 1 January 2019, profit from these operations is presented on a separate line of theincome statement, under “Profit (loss) from discontinued operations”. In accordance withIFRS 5, comparative figures are restated. The application of IFRS 5 impacts the 2019 and2018 consolidated income statements as follows:


Revenue from continuing operations (161.2) (220.5)

Operating expenses* 163.3 216.8

Profit (loss) from continuing operations 2.1 (3.7)

Other non-recurring operating income and expenses 6.1 8.7

Operating profit 8.2 5.0

Other financial income and expenses 3.5 0.4

Profit before tax 11.7 5.4

Income tax expense (2.4) 0.4

Profit (loss) from discontinued operations (9.2) (5.9)

In accordance with IFRS 5, property, plant and equipment was not amortised in 2019, amortisations which would*

have represented €7.2 million (in 2018 amortisations represented €6.6 million).

Cash flows from discontinued operations are also presented on a separate line of thestatement of cash flows. In accordance with IFRS 5, comparative figures are restated. Theapplication of IFRS 5 impacts the 2019 and 2018 consolidated cash flow tables as follows:


Net cash from (used in) operating activities (10.3) (5.3)

Net cash from (used in) investing activities - +7.6

Net cash from (used in) financing operations - (2.0)

Impact of change in exchange rate (0.2) (0.2)

Net cash from (used in) discontinued operations (10.5) -

Assets and liabilities held for sale

The assets and liabilities of these operations are presented solely at 31 December 2019, onseparate lines of the statement of financial position. In accordance with the requirementsof the standard, the statements of financial position at 31 December 2018 are not restated.

At 31 December 2019, the application of IFRS 5 impacted the consolidated statement offinancial position as follows:

in € millions 31 Dec. 2019

Non-current assets 124.6

Current assets 73.1

Cash and cash equivalents 3.4

Assets held for sale 201.1

Non-current liabilities 9.0

Current liabilities 74.3

Liabilities held for sale 83.3



ADJUSTMENTS TO 2.2.6.ACQUISITIONS MADE IN THE PREVIOUS FINANCIAL YEAR

No material adjustments were made toacquisitions made in the previousfinancial year.

DISPOSALS FOR THE 2.2.7.FINANCIAL YEAR

Jade (Northern Technology Investments Limited)

In July 2019, the Group sold its shares inJade to associate shareholders, producing acapital gain, that impacted the “Profit (loss)from discontinued operations” line on theincome statement.

Mobis and its subsidiaries (Rayonnance)

In December 2019, the Group sold anon-controlling interest in this satellite.The operation generated a capital gain forthe Group, that impacted the “Otherincome and nonrecurring operatingincome” line of the income statement.

SPLIT OF “ECONOCOM 2.2.8.OSIATIS FRANCE”

As part of the continuation of therestructuring of its IT service businesses inFrance, with a view to specialising itsentities by business lines, "EconocomOsiatis France" was split, with its assetstransferred to "Econocom BusinessContinuity" and "Econocom InfogéranceSystèmes"

Main consolidated companies2.3.The Group’s main fully consolidated subsidiaries were as follows:

Country Company 2019 2018

% interest % control % interest % control

Holding companies

Belgium Econocom Finance SNC 100.00% 100.00% 100.00% 100.00%

France Econocom SAS 100.00% 100.00% 100.00% 100.00%


Germany Econocom Deutschland GmbH 100.00% 100.00% 100.00% 100.00%

Belgium Atlance SA/NV 100.00% 100.00% 100.00% 100.00%

Belgium Econocom Lease SA/NV 100.00% 100.00% 100.00% 100.00%

Spain Econocom SA (Spain)(1) 100.00% 100.00% 100.00% 100.00%

USA Econocom Corporation 100.00% 100.00% 100.00% 100.00%

France Atlance SAS 100.00% 100.00% 100.00% 100.00%

France Cineolia SAS 60.00% 60.00% 60.00% 60.00%

France Econocom France SAS 100.00% 100.00% 100.00% 100.00%

Ireland Econocom Digital Finance Limited 100.00% 100.00% 100.00% 100.00%

Italy Econocom International Italia SpA(1) 100.00% 100.00% 100.00% 100.00%

Netherlands Econocom Nederland BV 100.00% 100.00% 100.00% 100.00%

Netherlands Econocom Public BV 100.00% 100.00% 100.00% 100.00%

Poland Econocom Polska SP z.o.o 100.00% 100.00% 100.00% 100.00%

United Kingdom Econocom Ltd 100.00% 100.00% 100.00% 100.00%



Country Company 2019 2018

% interest % control % interest % control


Germany Energy Net 80.00% 80.00% 80.00% 80.00%

Austria Econocom Austria GmbH (formerly Osiatis Compute Services) 100.00% 100.00% 100.00% 100.00%

Belgium Econocom Managed Services SA/NV 100.00% 100.00% 100.00% 100.00%

Belgium Econocom Products & Solutions Belux SA/NV 100.00% 100.00% 100.00% 100.00%

Brazil Econocom Brazil group 100.00% 100.00% 100.00% 100.00%

Spain Com 2002 SL Nexica 100.00% 100.00% 100.00% 100.00%

Spain Econocom Servicios (formerly Econocom Osiatis SA) 96.51% 96.51% 96.51% 96.51%

Spain Altabox(2) 75.03% 75.03% 60.02% 60.02%

Spain Caverin 100,00% 100,00% 100.00% 100.00%

Spain, Brazil, Mexico Gigigo group(2) 100,00% 100,00% 69.99% 69.99%

France/US/Canada Groupe Aciernet 90.00% 100.00% 90.00% 100.00%

France Alterway group(2) 64.45% 64.45% 61.34% 61.34%

France Aragon eRH 100.00% 100.00% 100.00% 100.00%

France ASP Serveur SAS 100.00% 100.00% 100.00% 100.00%

France Digital Dimension SAS 100.00% 100.00% 100.00% 100.00%

France Econocom Digital Security SAS 65.50% 65.50% 65.50% 65.50%

France Econocom Products & Solutions SAS 100.00% 100.00% 100.00% 100.00%

France ESR SAS 100.00% 100.00% 100.00% 100.00%

France Exaprobe SAS 90.00% 90.00% 90.00% 90.00%

France Helis SAS 63.02% 63.02% 63.02% 63.02%

France Infeeny group (2) 95.68% 95.68% 86.02% 86.02%

France Mobis SAS group (Rayonnance)(2) - - 85.00% 85.00%

France Econocom-Osiatis France SAS - - 100.00% 100.00%

France Econocom Business Continuity 100.00% 100.00% 100.00% 100.00%

France Econocom Infogérance Systèmes 100.00% 100.00% 100.00% 100.00%

France Econocom-Osiatis Ingénierie SAS 100.00% 100.00% 100.00% 100.00%

Italy/Poland Bizmatica group 70.00% 70.00% 70.00% 70.00%

Italy Asystel Italia 51.00% 51.00% 51.00% 51.00%

Italy BDF 100.00% 100.00% 100.00% 100.00%

Luxembourg Econocom PSF SA 100.00% 100.00% 100.00% 100.00%

Luxembourg, France, Germany, Romania,

SynerTrade group(2) 100,00% 100,00% 90.00% 90.00%

Netherlands, Belgium BIS group 100.00% 100.00% 100.00% 100.00%

United Kingdom NTIL group (Jade) - - 85.00% 85.00%

Econocom International Italia SpA also operates in the Digital Services & Solutions business.(1)

Change in interest and control rates: see section 2.2.3.(2)



Contingent acquisition-related liabilities2.4.The contingent acquisition debts includeoptions to commit to buy backnon-controlling interests, contingentconsideration and deferred payments, mostof which have been granted subject toattainment of future financial targets. Theyare thus dependent on the estimated futureperformance of the entities concerned (e.g.EBIT multiples, expected future cash flows,etc.).

At the end of 2019, the Group has calloptions (and non-controlling shareholdershave put options) on the remaining shares itdoes not already own, allowing it to acquireall or part of the share capital of thefollowing entities: Altabox, Alterway, AsystelItalia, Bizmatica, Econocom Digital Security,Energy Net, Exaprobe, Helis, JTRS andInfeeny. Under these options, Econocomagreed to acquire the shares and also hasthe right to be sold the shares by thenon-controlling shareholders.

The table below shows changes in contingent acquisition-related liabilities over the year.

in € millions

Put and calloptions on

non-controllinginterests

Contingentconsideration

Deferredpayments

Totalcontingent

acquisition-related

liabilities

Currentportion

Non-currentportion

31 Dec. 2018 100.5 8.2 15.5 124.1 58.9 65.2

Increases against equity or goodwill - - - -

Disbursements (24.7) (13.6) (15.0) (53.3)

Change in fair value through equity

(11.8) - - (11.8)

Reclassification (3.8) 1.3 2.5

Change in fair value through nonrecurring profit or loss(1)

(1.4) 7.6 - 6.3

Change in fair value through recurring profit or loss(2)

0.4 0.3 - 0.7

31 Dec. 2019 59.1 3.8 3.0 66.0 28.0 38.0

The offsetting entry for these changes in fair value is recorded within non-recurring operating income and(1)

expenses.The offsetting entry for these changes in fair value is included in the profit (loss) from continuing operations.(2)

Put options on noncontrolling interests areclassified in “Other liabilities”, with changesin fair value recognised in equity.

Contingent consideration and deferredpayments are classified within financialliabilities (see note 13.3).


06consolidated financial statementsotes to the consolidated financial statements

Segment reporting3.The segment information presented inaccordance with IFRS 8 has been preparedon the basis of internal management datadisclosed to the Executive Committee, theGroup’s primary operating decision-makerwith respect to allocating resources andassessing performance.

former Services and Products & Solutionssegments. Over time, the distinctionbetween these businesses had lost itsrelevance given the Group’s positioning asan integrator of digital solutions thatcombine products, software and services.

On 1 January 2019, the Group created a newreporting segment, Digital Services &Solutions (DSS), which combines the

Consequently, the Group’s business is nowbroken down into two operating businesssegments:

Combined strategic operating business segments

Description Countries


Innovative, tailored financingsolutions to ensure more effective

administrative and financialmanagement of the ICT and digital

assets of the businesses.

Belgium, Canada, Czech Republic,France, Germany, Ireland, Italy,Luxembourg, Mexico, Morocco,Netherlands, Poland, Romania,

Spain, Switzerland, UnitedKingdom, USA.


Using our expertise to support thetransformation to the new digital

world (in consulting, infrastructuremanagement, development of

applications and integration of digitalsolutions) and with services ranging

from the design to roll-out ofsolutions, and from the sale of

hardware and software (PCs, tablets,servers, printers, licences, digital

devices, etc.) to systems integration.

Germany, Austria, Belgium, Brazil,Canada, Spain, United States,

France, Italy, Luxembourg, Mexico,Morocco, Netherlands.

Each segment has a specific profitabilityprofile and has its own characteristics;segments are managed depending on thetype of products and services sold in theireconomic and geographical environments.

Sales and transfers between segments arecarried out on arm’s-length terms and areeliminated according to standardconsolidation principles.



Reporting by operating business segment3.1.The following table presents the contribution of each operating business segment to theGroup’s results:

in € millionsTechnology

Management &Financing

Digital Services& Solutions Total

2019 Revenue

Revenue from external clients 1,124.2 1,802.4 2,926.6

Internal operating revenue 31.1 338.4 369.5

Total – Revenue from operating segments 1,155.3 2,140.8 3,296.1

Profit (loss) from continuing operations(1) 43.9 82.3 126.2

Amortisation of intangible assets from acquisitions (2.0) - (2.0)

Profit (loss) from continuing operations 41.9 82.3 124.2

Before amortisation of intangible assets from acquisitions(1)

in € millions, restated*Technology


Digital Services& Solutions Total

2018 revenue

Revenue from external clients 1,321.1 1,677.9 2,999.0

Internal operating revenue 10.6 241.4 252.0

Total – Revenue from operating segments 1,331.6 1,919.4 3,251.0

Profit (loss) from continuing operations(1) 52.3 58.6 110.9

Amortisation of intangible assets from acquisitions (2.0) (2.2) (4.2)

Profit (loss) from continuing operations 50.2 56.4 106.7

In accordance with IFRS 5 (see 2.2.5), 2018 income and expenses of operations considered discontinued in 2019 are*

reclassified to "Profit or loss of the discontinued operations" in the 2018 income statement. However, inaccordance with the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is not restatedfor the impact of this regulation on leases (see 1.1.1.1). In addition, the 2018 consolidated income statement isimpacted by the recognition henceforth on the principal basis (within the meaning of IFRS 15) of direct deliveries(cf. 1.2.2.).Before amortisation of intangible assets from acquisitions(1)



Internal transactions include:

sales of goods and services: the Group•ensures that these transactions areperformed at arm’s length and that itdoes not carry any significant internalmargins;

cross-charging of overheads and•personnel costs.

The Group’s segment profit corresponds to“Profit (loss) from continuing operations”.This corresponds to operating profit beforenon-recurring operating income andexpenses and amortisation of intangibleassets from acquisitions.

3.2 Breakdown of revenue by geographical area

in € millions Revenue by geographical area(origin)

2019 2018 restated*

France 1,545.3 1,510.4

Benelux 391.2 395.4

Southern Europe and Morocco 528.6 621.2

Northern & Eastern Europe 261.1 264.9

Americas 200.4 207.0

Total 2,926.6 2,999.0


reclassified to "Profit (loss) from discontinued operations" in the 2018 income statement. However, in accordancewith the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is not restated for theimpact of this regulation on leases (see 1.1.1.1). In addition, the 2018 consolidated income statement is impacted bythe recognition henceforth on the principal basis (within the meaning of IFRS 15) of direct deliveries (cf. 1.2.2.).

2019 Southern Europe turnover of €528.6 million breaks down as €306.4 million for Italyand €222.2 million for Spain. In 2018 the corresponding figures were €397.9 million for Italyand €201.4 million for Spain (after an IFRS 16 restatement of €21.9 million).



Profit (loss) from continuing 4.operationsProfit (loss) from continuing operationsincludes all income and expenses that arisedirectly from the Group’s business, bothrecurring items and items resulting fromone-off decisions or transactions.

Recurring profit (loss) from continuingoperations, representing operating profitrestated for other non-recurring incomeand expenses, is an analytical line itemintended to facilitate the understanding ofthe Group’s operating performance.

Income from contracts with clients4.1.Revenue from contracts with customers by business line breaks down as follows:

in € millions 2019 2018 restated*

Technology Management & Financing 1,124.2 1,321.1

Digital Services & Solutions 1,802.4 1,677.9

Total revenue from continuing operations 2,926.6 2,999.0


reclassified to "Profit or loss of the discontinued operations" in the 2018 income statement. However, inaccordance with the provisions of IFRS 16, which came into force on 1 January 2019, the 2018 data is not restatedfor the impact of this regulation on leases (see 1.1.1.1). In addition, the 2018 consolidated income statement isimpacted by the recognition henceforth on the principal basis (within the meaning of IFRS 15) of direct deliveries(cf. 1.2.2.).

REVENUE RECOGNITION: 4.1.1.ACCOUNTING PRINCIPLES

Revenue recognition

The revenue recognition method variesdepending on the nature of the performanceobligations of the contract binding Groupentities and their respective customers.Performance obligations are the goods orservices promised in the contract.

The performance obligation is the unit ofaccount for revenue recognition: the price ofthe contract is allocated to each individualperformance obligation, and a pattern ofrevenue recognition is determined for eachsuch obligation.

Econocom recognises revenue when it hassatisfied (or as it satisfies) a performanceobligation by providing the customer withthe promised good or service.

A performance obligation is satisfied whencontrol of the good or service is transferredto the customer. This transfer may takeplace at a point in time or over time.Revenue is recognised:

over time when one of the following•conditions is fulfilled;

the customer receives the benefits of▶the service as the entity performssuch services,

the customer obtains control of the▶asset as the asset is created,



the final asset has no alternative use▶for the entity and the entity has anenforceable right to payment forperformance completed to date;

in full at a point in time, namely at•completion, in all other cases.

Application to the Group’s various businesses

Sale of assets

Revenue is recognised when the goods aredelivered and ownership is transferred,when the following conditions are met:

the Group has transferred to the buyer•the significant risks and rewards ofownership of the goods;

the Group retains neither continuing•managerial involvement to the degreeusually associated with ownership noreffective control over the goods sold.

Finance lease sales

In accordance with IFRS 16, the revenuerecognition rules differ depending on thetype of contract. These methods were notchanged, in relation to IAS 17, with the entryinto force of IFRS 16 on 1 January 2019, exceptfor some Sale & Leaseback contracts (see1.1.1.1).

Sales of services

The following types of contracts andactivities are covered:

“run” phase. If this is not the case, therevenue may only be recognised as therecurring services are performed, and thecosts of the “Build” phase must becapitalised if they create a resource thatwill be used for the future delivery ofservices;

outsourcing contracts: these contracts•are split into a “build” phase and a “run”phase when the deliverables are distinct;revenue from the two phases isrecognised as and when control istransferred. For the “build” phase to bedeemed distinct, it must be representativeof a service from which the customer canbenefit distinctly from the delivery of the

maintenance activities operated by•Econocom: revenue is recognised on apercentage-of-completion basis;

activities involving the loan of employees•under time-and-materials contracts:revenue is recognised on a time-spentbasis;

development of applications under•fixed-price contracts: revenue isrecognised on a percentage of completionbasis as control is transferred;

infrastructure installation projects: the•percentage-of-completion method stillapplies insofar as the transfer of controltakes place over time.

For certain fixed-price contracts providingfor a number of different serviceobligations, the transaction price maysometimes be reallocated to the variousperformance obligations on a case-by-casebasis in order to reflect the economic valueof the services rendered (which may differfrom their contractual value).

For contracts separated into stages,revenue and margin are recogniseddepending on the stage of completion inaccordance with the method that bestreflects the transfer of goods and services tothe customer. This results in the recognitionof revenue accruals or deferred incomewhen invoicing does not reflect the stage ofcompletion of the work. A contingencyprovision for the expected loss on a projectis recognised if the cost of the project isgreater than the expected revenue.



“Principal” versus “agent” considerations

In the course of its business, the Group maybe required to resell equipment, softwareand services purchased from third parties.For the supply of these goods and services,Econocom may act as either principal oragent.

Econocom is a principal if its “performanceobligation” requires it to provide goodsand/or underlying services to the client.

This means that Econocom thereforecontrols the good or service before it istransferred to the customer.

The Econocom group is an agent if its“performance obligation” requires it toarrange for a third party to provide goodsor underlying services, without being ableto direct use and obtain key economicbenefits. In this case, Econocom does notcontrol the goods and services before theyare transferred to the customer.

Management has made a significantjudgement related to principal versusagent considerations. The impact on thepresentation of reported revenue is asfollows:

on a gross basis when Econocom is a•principal;

net of the cost of sales when Econocom is•an agent.

Presentation in the statement of financial position

Services in progress at the end of thereporting period are recognised in revenueaccruals and are estimated based on thesale price. If accrued revenue constitutes anunconditional right to a consideration, i.e., ifthe passage of time is sufficient forpayment of the consideration to fall due,the accrued revenue will constitute areceivable. In all other cases, it constitutesthe contract assets. Revenue accruals areclassified in “Trade and other receivables”.

Advance payments received fromcustomers and prepaid income are thecontract liabilities. They are classified in“Other current liabilities”.

Contract performance costs are costs thatare directly assigned to a customercontract and have not yet been rebilled. Forexample, they may include dedicatedinventories in transit, costs allocated toservice obligations, transition fees inoutsourcing contracts or marginal costsfrom obtaining contracts (i.e., costs thatEconocom would not have incurred if ithad not won the contract). These costs arecapitalised if Econocom expects to recoverthem. They are then classified in “Othercurrent assets”.

LEASE ACCOUNTING4.1.2.

Virtually all leases entered into by theTechnology Management & Financingbusiness as lessor are finance leases,although operating leases may alsooccasionally be contracted.

4.1.2.1. Finance leases

The Group identifies finance leasecontracts, as opposed to the operatingleases, using the criteria set out in IFRS 16. Alease is classified as a finance lease (ratherthan an operating lease) if it transferssubstantially all the risks and rewardsincidental to ownership. Whendetermining whether a lease transferssubstantially all the risks and rewardsincidental to ownership and shouldtherefore be classified as a finance lease,the Group generally uses (i) the fair valuecriterion (i.e., the lease is a finance lease if,at inception, the present value of theminimum lease payments amounts to atleast substantially all of the fair value of theleased asset), and then (ii) the economic lifecriterion (i.e., the lease is a finance lease ifthe lease term is for the major part of theeconomic life of the asset even if title is nottransferred). At the beginning of the lease,the discounted value of the minimum lease



payments must be equal to almost theentire fair value of the leased asset. Thethresholds applied are based on those ofASC 840 under US GAAP, i.e., 85%, of the fairvalue of the leased asset and 75% of theasset’s economic life. In practice, as it is theGroup’s policy not to use its equity to fundleases and to limit its risk on residual value,operating leases are fairly rare.

Finance leases where the Group is lessorare mainly refinanced contracts in which:

the lease contracts and equipment are•sold to refinancing institutions at anall-inclusive price representing thepresent value of future minimum leasepayments receivable and the residualfinancial value of the equipment;

residual financial value represents the•amount for which the Group undertakesto repurchase the equipment upon expiryof the lease;

lease payments due by lessees are paid•directly to the refinancing institutions on anon-recourse basis, which means that theGroup transfers the risk of paymentdefault.

From a legal standpoint, the Grouprelinquishes ownership of the equipmenton the date of sale to the refinancinginstitution and recovers ownership at theend of the lease term by repurchasing theequipment. In some cases, the Group asksthe refinancing institutions to grant itinvoicing and payment agency on theirbehalf. This does not alter the transfer ofthe risk of payment default from thelessees to the refinancing institutions.

assets are delivered, pro rata to the amountof each delivery.

Econocom acts as a dealer lessor andtherefore recognises a margin as from theinception of the lease. Revenue, cost ofsales and the residual interest in leasedassets are recognised progressively as

IFRS 16 states that initial recognition of alease must take place at thecommencement of the lease term, i.e., thedate from which the lessee is entitled toexercise its right to use the leased asset.The provisions of the Group’s General LeaseConditions define this date as the date onwhich the leased asset is delivered, which isofficially confirmed when the Statement ofAcceptance is signed.

Refinanced contracts are accounted for asfollows:

Statement of financial position

For each lease, the Group’s residual interestin the leased assets (see note 11.1) isrecognised in assets and the gross liabilityfor purchases of leased assets (defined innote 11.2) is recognised in liabilities.

Income statement

Revenue on these contracts corresponds tothe present value of future minimum leasepayments (corresponding to the paymentsthat the lessee is required to makethroughout the realisation period and thelease term).

Financial income not yet acquired fromlease payments is recognised in theincome statement when the contracts arerefinanced.

The impacts of discounting only concernthe “Gross liability for purchases of leasedassets” (see note 11.2) and the “Residualinterest in leased assets” (see note 11.1)items.

The cost of sales represents the purchasecost of the asset.

The Group’s residual interest in the leasedassets is deducted from the cost of salesbased on its present value.



Operating leases4.1.2.2.

The Group retains all the risks relating tooperating leases as the significant risks andrewards incidental to ownership of theassets concerned are not transferred.

Statement of financial position

The leased equipment is recorded as anasset in the statement of financial positionand depreciated on a straight-line basisover the duration of the contract to write itdown to its residual value, which representsthe Company’s residual interest in the assetat the end of the lease term.

Income statement

payments recorded as revenue and thedepreciation described above recorded asan expense.

Income statement entries are made on aperiodic basis with the invoiced lease

Lease extensions4.1.2.3.

Revenue is recognised on lease extensionsin line with the initial classification of thelease, i.e.:

if the initial contract was classified as an•operating lease, revenue from theextension of the lease will be deferred overthe period of the lease extension;

if the initial contract was classified as a•finance lease, revenue from the extensionof the lease will be recognised in full onthe last day of the initial contract.

Personnel costs4.2.The following table presents a breakdown of employee benefits expenses:


Wages and salaries (372.7) (391.8)

Payroll costs (130.5) (137.2)

Other (18.2) (16.9)

Total (521.3) (545.8)

Following the application of IFRS 5 (see 2.2.5.).*

Expenses relating to defined benefit pension plans and included in other employeebenefits expense concern the Group’s subsidiaries in France, Italy, Belgium and Austria. Thecharacteristics of these plans are set out in note 17.



Government grants4.3.

Government grants are recognised as adeduction from costs (e.g., wages andsalaries), or within other operating incomeand expenses, as appropriate.

Government grants are only recognisedwhen the Group is certain to collect them.In accordance with IAS 20, the Groupapplies different accounting treatment forgrants related to assets (or investmentsubsidies) and grants related to income.

Grants related to assets are recognised inprofit or loss over the periods in which theGroup expenses the costs that the grantsare intended to compensate. In practice,they are recognised over the periods and inthe proportions in which depreciationexpense is recognised on the depreciableasset covered by the grant, with thedeferred income recognised in liabilities.Grants related to income are recognised tooffset the costs that they are intended tocover.

Tax credits treated as research grantsand competitive and employment for2018 tax credits

Tax credits are accounted for depending onthe tax treatment applicable in eachcountry:

if the tax credit is only calculated based•on specific expenses, does not adjust thecalculation of the subsidiary’s taxableprofit, is not limited by the tax liability ofthe subsidiary, and may be refunded incash, it is treated as a grant within themeaning of IAS 20 – Accounting forGovernment Grants and Disclosure ofGovernment Assistance and includedwithin operating profit;

in all other cases it is recognised within•income tax.

The French research tax credits (CIR) andemployment and competitiveness taxcredits for 2018 are accounted for asgovernment grants.

External expenses4.4.The following table presents a breakdown of external expenses:


Fees paid to intermediaries and other professionals (65.5) (61.1)

External services (rent, maintenance, insurance, etc.)** (11.2) (37.2)

Agents’ commissions (34.3) (33.9)

Other external expenses (subcontracting, public relations, transport, etc.) (47.0) (54.8)

Total (158.1) (187.0)Following the application of IFRS 5 (see 2.2.5.).*

The change in this item came from the introduction on 1 January 2019 of IFRS 16 on Leases (see 1.1.1.1) for an**

amount of €26.9 million in 2019.



4.5. Additions to and reversals of depreciation, amortisation and provisionsAdditions to and reversals of depreciation, amortisation and provisions break down asfollows:


Intangible assets: franchises, patents, licences and similar rights, business assets** (39.1) (14.7)

Property, plant and equipment (leased assets) (0.5) (0.8)

Other property, plant and equipment (11.1) (10.9)

Depreciation and amortisation (50.7) (26.4)Additions to and reversals of provisions for operating contingencies and expenses 3.2 (1.2)

Total (47.4) (27.6)Pursuant to the application of IFRS 5 (see 2.2.5.).*

The change in this item came from the introduction on 1 January 2019 of IFRS 16 - Leases (see 1.1.1.1) for €25.3**

million. In addition, this item includes €2.0 million in 2019 and €4.2 million in 2018 under amortisation ofintangible assets from acquisitions.

Net impairment losses on current and non-current 4.6.assetsin € millions 2019 2018 restated*

Impairment of inventories (2.0) (2.8)

Reversals of impairment of inventories 2.4 2.3

Net impairment losses/gains – inventories 0.4 (0.5)

Impairment of doubtful receivables (16.9) (16.9)

Reversals of impairment of doubtful receivables 10.5 13.4

Gains and losses on receivables - (7.4)

Net impairment losses/gains – trade receivables (6.4) (10.9)

Losses/gains on other asset realisations (1.2) (3.1)




Other recurring operating income and expenses4.7.Other recurring operating income and expenses break down as follows:


Cross-charging and indemnities received 8.0 8.8

Capital losses on sales of property, plant and equipment and intangible assets – recurring operating activities (0.9) (0.4)

Cross-charging and indemnities paid (2.5) (0.2)

Total 4.5 8.2Following the application of IFRS 5 (see 2.2.5.).*

Financial income – operating activities4.8.The following table breaks down financial income and expenses relating to operatingactivities by type of income/expenses:


Financial income related to Technology Management & Financing operations 22.6 19.9

Miscellaneous financial income from operating activities 1.7 1.2

Total financial income – operating activities 24.3 21.1

Financial expenses related to Technology Management & Financing operations (18.1) (15.5)

Financial expenses related to miscellaneous operating activities (1.5) (1.6)

Exchange losses (0.1) (1.5)

Total financial expenses – operating activities (19.6) (18.6)

Total 4.7 2.5


Financial income and expenses relating toTechnology Management & Financingoperations reflect the unwinding of thediscount during the year on the grossliability for purchases of leased assets, theGroup’s residual interest in leased assetsand lease payments outstanding.

Net exchange losses recorded in theincome statement result mainly fromfluctuations in the pound sterling and USdollar.



Other non-recurring operating 5.income and expensesNonrecurring operating income andexpenses mainly include:

income and expenses that are deemed•unusual in terms of their frequency,nature or amount;

goodwill impairment losses;•

material gains and losses on disposals of•property, plant and equipment andintangible assets, or of operating assetsand investments;

restructuring costs and costs associated•with downsizing plans;

costs relating to acquisitions (acquisition•fees);

the costs of relocating premises;•

changes in the fair value of•acquisition-related liabilities (contingentconsideration); changes in the fair value ofput and call options to buy outnoncontrolling interests are recogniseddirectly in equity.


Restructuring costs 29.8 (15.2)

Other non-recurring expenses and income 5.0 4.7


Restructuring costs relate to the transformation plan launched in 2019 and thecontinuation of performance improvement plans during the year. Other non-currentincome and expenses includes the exceptional items recorded in 2019 in connection withthe events which Econocom was a victim of in Italy, impairment losses of certain intangibleassets (IT) and the capital gain from the disposal of Rayonnance.



Net financial expense6.in € millions 2019 2018 restated*

Financial income 0.1 0.2

Financial expenses on bonds (10.3) (9.5)

Expenses on non-current liabilities - (0.3)

Interest cost of retirement benefits and other post-employment benefits (0.6) (0.6)

Interest on short-term financing (2.5) (1.8)

Financial expenses on factoring (2.5) (3.0)

Interest expense on lease liabilities (1.6) -

Other financial expenses (1.7) (0.6)

Financial expenses (19.3) (15.7)

Net financial expense (19.2) (15.5)Following the application of IFRS 5 (see 2.2.5.).*



Income tax7.Income tax expense for the year includescurrent taxes and deferred taxes.

Current tax is (i) the estimated amount oftax due in respect of taxable profit for agiven period, as determined using tax ratesthat have been enacted or substantivelyenacted at the end of the reporting period,(ii) any adjustments to the amount ofcurrent tax in previous periods, and (iii) anyother tax calculated on a net amount ofincome and expenses.

determined based on the way in which theGroup expects to recover or pay thecarrying amount of the assets and liabilitiesusing the tax rates that have been enactedor substantially enacted at the reportingdate.

Deferred taxes are accounted for using theliability method for all temporarydifferences between the carrying amountrecorded in the consolidated statement offinancial position and the tax bases ofassets and liabilities, except for non-taxdeductible goodwill. Deferred taxes are

Deferred tax assets and liabilities are notdiscounted and are offset when they relateto the same tax entity. They are classified inthe statement of financial position asnon-current assets and liabilities.

Deferred tax assets are only recognised tothe extent that it is probable that futuretaxable profit will be available againstwhich deductible temporary differences ortax losses and tax credit carryforwards canbe utilised.

Recognition of current and deferred taxes7.1.in € millions Notes 2019 2018 restated*

Current tax (19.6) (25.1)

Movements in tax provisions 16 1.1 1.7

Deferred tax 7.2 (3.8) 2.6


Effective tax rate


Profit before tax on continuing operations 80.2 71.2

Income tax on the profit of continuing operations (22.3) (20.8)

Effective tax rate as a percentage of profit before tax 27.8% 29.2%

Effective tax rate as a percentage of profit before tax (restated) 21.2% 22.2%




The income tax expense amounted to €16.7 million, plus €5.6 million from tax on valueadded in France (CVAE) and from the IRAP tax (Imposta Regionale sulle Attività Produttive)in Italy, for a total of €22.3 million.

Given the profit before tax of continuing operations of €80.2 million, the effective tax ratereported reached 27.8% (29.2% adjusted at end 2018); restated for amortisation of intangibleassets (ECS customer portfolio and Osiatis brand) and the CVAE/ value/IRAP, the restatedeffective tax rate was 21.2% in 2019 (22.2% adjusted in 2018).

Reconciliation between theoretical tax expense and effective tax expense


Profit before tax on continuing operations 80.2 71.2

Theoretical tax expense at current Belgian rate (29.58%) (23.7) (21.1)


Reconciliation


Unrecognised tax losses arising in the year (3.3) (2.1)

Previously unrecognised tax losses used in the year 1.9 0.3

De-recognition of previously recognised tax deficits (0.2) -

Adjustment to current and deferred tax 4.0 1.0

Effect of taxes other than on income(1) (5.6) (5.5)

Effect of foreign income tax rates and changes in foreign income tax rates (2.4) (1.5)

Tax credits and other 0.7 3.6

Other permanent differences 6.3 4.5

Total differences 1.4 0.3

Effective income tax expense (22.3) (20.8)Adjustments related to the change in presentation of the additional depreciation (see 1.2.2) and following the*

application of IFRS 5 (see 2.2.5).Taxes other than on income relate to taxes assessed on value added that meet the requirements of IAS 12. For(1)

Econocom, this relates to the tax on value added in France (net of income tax) and to the IRAP tax (ImpostaRegionale sulle Attività Produttive) in Italy.



Deferred tax assets and liabilities7.2.Analysis of deferred tax assets and liabilities

in € millions 31 Dec.2018

Income/expense

for theyear

(incomestatement)

Othercompre-hensiveincome(equity)

Reclassi-fications

Reclassifiedas assets

held for sale

Changesin scope

ofconsoli-

dation

31 Dec.2019

Pension obligations 10.2 0.3 (0.1) (0.4) (1.5) (0.3) 8.2

Temporary differences arising on provisions

4.8 (0.4) - 0.5 - (0.2) 4.8

Other assets and liabilities * 19.8 5.1 1.0 - - (0.3) 25.6

Tax loss carryforwards 18.0 (1.9) - (0.4) - - 15.6

Impact of netting DTA/DTL (18.9) - - 2.2 - - (16.7)

Total deferred tax assets 33.8 3.1 0.9 2.3 (2.0) (0.8) 37.4

* Includes the deferred tax asset linked to the Italian additional depreciation of €13.7 million at 31December 2019.

Deferred tax on TMF business

(17.7) (2.7) - - - - (20.4)

Amortisable intangible assets

(8.2) (0.1) - (0.3) 1.0 - (7.6)

Other assets and liabilities

0.4 0.5 - 0.1 - - 1.1

Impact of netting DTA/DTL

18.9 - - (2.2) - - 16.7

Total deferred tax liabilities

(6.6) (2.3) - (2.3) 1.0 - (10.2)

Net deferred tax assets (liabilities)

27.2 0.8 0.9 - (1.0) (0.8) 27.2



in € millions 31 Dec. 2019 31 Dec. 2018

Recoverable within 12 months, before netting, by tax jurisdiction (4.1) 9.2

Recoverable after 12 months, before netting, by tax jurisdiction 31.3 18.0

Net deferred tax assets (liabilities) 27.2 27.2

Tax loss carryforwards

At 31 December 2019, the Group’s tax loss carryforwards amounted to €178 million, versus€139.7 million at 31 December 2018.

The increase in tax loss carryforwards primarily concerns Econocom International Italia,Econocom Austria, Econocom Deutschland Holding, Aragon and Synertrade SES AG.

Unrecognised deferred tax assets on tax loss carryforwards totalled €29.2 million versus€18.4 million at 31 December 2018. This increase is in line with the increase in unrecognisedlosses in 2019. If anything this is financial year, but exercice is not in the TM as a definedterm, and is rarely sued.

Basic earnings per share8.Basic earnings per share is calculated bydividing profit for the period attributable toowners of the parent by the weightedaverage number of shares outstandingduring the year, excluding treasury shareson a pro rata basis.

instruments carrying deferred rights to theparent company’s capital, issued either bythe parent company itself or by any one ofits subsidiaries. Dilution is calculatedseparately for each instrument, based onthe conditions prevailing at the end of thereporting period and excluding non-diutiveDiluted earnings per share is calculated byinstruments.taking into account all financial

Basic earnings per share attributable to owners of the parent

in € millions, except for per share data and number of shares 2019 2018 restated*

Consolidated profit (loss) for the period 44.7 39.4

Consolidated profit (loss) attributable to owners of the parent from continuing operations 53.9 45.2

Consolidated profit (loss) attributable to owners of the parent from discontinued operations (9.2) (5.9)

Recurring consolidated profit (loss) attributable to owners of the parent(1) 72.1 62.4

Average number of shares outstanding 227,816,144 234,888,774

Consolidated profit (loss) for the period per share (in €) 0.196 0.168

Earnings per share from continuing operations (in €) 0.237 0.193

Earnings per share from discontinued operations (in €) (0.041) (0.025)

Recurring earnings per share attributable to owners of the parent (1) (in €) 0.317 0.266

Pursuant to the application of IFRS 5 (see 2.2.5.).*

Recurring earnings for the year attributable to owners of the parent corresponds to profit for the year attributable(1)

to owners of the parent, before the following items: amortisation of intangible assets from acquisitions, net of tax effects;• other non-recurring operating income and expenses, net of tax effects;• other non-recurring financial income and expenses, net of tax effects;• profit from discontinued operations.•



Diluted earnings attributable to owners of the parent, per share

in € millions, except for per share data and number of shares 2019 2018 restated*

Diluted earnings 48.0 42.1

Diluted earnings from continuing operations 57.2 47.9

Diluted earnings from discontinued operations (9.2) (5.9)

Average number of shares outstanding 227,816,144 234,888,774

Impact of stock options 584,776 1,809,082

Impact of free shares 1,301,240 273,274

Impact of OCEANE convertible bonds 24,213,075 20,177,563

Diluted average number of shares outstanding 253,915,235 257,148,693

Diluted earnings per share (in €) 0.189 0.164

Diluted earnings per share from continuing operations (in €) 0.225 0.186

Diluted earning per share from discontinued operations (in €) (0.036) (0.023)

Diluted earning per share attributable to owners of the parent (in €) 0.297 0.253

Pursuant to the application of IFRS 5 (see 2.2.5.).*

In accordance with IFRS standards, the stock option expense recognised in the incomestatement was not restated.



Goodwill and impairment 9.testing

Definition of cash-generating units9.1.The growing proportion of internationalcustomers and the pooling of resourcesamong business lines have led the Groupto redefine the scope of its cash-generatingunits (CGUs) as representing its twobusiness segments: TechnologyManagement & Financing, and DigitalServices & Solutions.

A CGU is defined as the smallestidentifiable group of assets that generatescash inflows that are largely independentof the cash inflows from other assets orgroups of assets. Each CGU or group ofCGUs to which goodwill is allocatedrepresents the lowest level within theGroup at which goodwill is monitored forinternal management purposes.

Goodwill allocation9.2.For the purposes of the impairment tests carried out at 31 December each year, goodwillwas allocated to the following cash generating units.



DigitalServices &Solutions

Total

2019

Goodwill at 31 December 2018 114.6 516.5 631.1

Reclassification to assets held for sale (0.8) (85.9) (86.7)

Acquisitions - - -

Disposals - (31.5) (31.5)

Foreign currency translation adjustments - - -

Impairment - - -


Of which gross amount 113.8 403.1 516.9

Of which accumulated impairment - (4.0) (4.0)

In 2019, goodwill from companies disposed of concerned Jade and Rayonnance.





DigitalServices &Solutions

Total

2018


Adjustments to acquisition costs - 0.1 0.1

Acquisitions - 32.7 32.7

Disposals - - -

Foreign currency translation adjustments - (0.5) (0.5)

Impairment - - -


Of which gross amount 114.6 520.8 635.4

Of which accumulated impairment - (4.3) (4.3)

Impairment tests and impairment of goodwill9.3.

Impairment testing involves determiningwhether the recoverable amount of anasset, CGU or group of CGUs is lower thanits carrying amount.

The recoverable amount is the higher of fairvalue less the costs of disposal and value inuse.

Value in use is determined based onestimated future cash flows and a terminalvalue, taking into account the time value ofmoney and the risks associated with thebusiness and the specific environment inwhich the CGU or group of CGUs operates.

Cash flow projections are based on thebudgets and on business plans covering aperiod of no more than five years. Theterminal value is calculated by discountingnormalised annual cash flows to perpetuity.

Fair value is the amount that could beobtained from the sale of the tested assetsin an arm’s length transaction betweenknowledgeable, willing parties, afterdeducting the estimated costs of disposal.These amounts are calculated based onmarket information.

When the recoverable value of the assets ofa CGU or group of CGUs is lower than itscarrying amount, an impairment loss isrecognised.

Impairment losses are recorded first as areduction of the carrying amount ofgoodwill allocated to a CGU and thencharged against the assets of the CGU, prorata to the carrying amount of each of thecomponents of the CGU. Impairment lossesare recorded under “Non-recurringoperating income and expenses” in theincome statement.



Impairment losses recognised for property,plant and equipment and intangible assetsother than goodwill may be reversed insubsequent periods if the asset’srecoverable amount becomes greater thanits carrying amount.

Impairment losses recognised for goodwillmay not be reversed.

When a relevant CGU is disposed of, theresulting goodwill is taken into account forthe determination of the net proceeds ofthe disposal.

Results of impairment tests

Based on the impairment tests conducted, goodwill does not need to be impaired.

Key assumptions

The value in use of the Group’s CGUs is sensitive to the following assumptions:

discount rate applied to future cash flows;•

growth rate of cash flows beyond the forecast period;•

business plan (revenue and margin).•

2019 2018

Discount rate Perpetuitygrowth rate Discount rate Perpetuity

growth rate

Technology Management & Financing 8.50% 1.00% 8.00% 1.00%

Digital Services & Solutions 8.50% 1.50% 8.00%1.50%*

1.00% *

In 2018, perpetuity growth rates were 1.50% for Services activity and 1.00% for Products & Solutions.*

The growth rate and weighted average costof capital assumptions were reviewed inlight of global market data.

The after-tax discount rate usedcorresponds to the weighted average costof capital (“WACC”). The perpetuity growthrate applied by the Group does not exceedthe growth rate for the industry. Applying apre-tax discount rate to pre-tax cash flowswould have resulted in a similar value forthe CGUs.

The business plan was determined basedon the expected growth of markets for theCGU concerned, taking account of growthlevers identified by Management. Marginsare determined based on the historicalmargins observed in the years precedingthe start of the budget period. Thesemargins also take account of expectedefficiency gains as well as events known tomanagement and that could impact theprofitability of the activity.



Sensitivity to changes in assumptions

The table below shows the sensitivity of enterprise values to the assumptions used:

in € millionsSensitivity to rates Sensitivity

to cash flowsDiscount rate Perpetual growth rate

+1.0% (1.0%) +0.5% (0.5%) (5%)


(33) 59 28 (25) (22)

Digital Services & Solutions (80) 107 37 32 (81)

The sensitivity of impairment tests toadverse but feasible changes inassumptions is set out below:

reasonable sensitivity to changes in the•discount rate: a simulated increase of upto one percentage point in the discountrate used would not change the findingsof the Group’s analysis;

value in use of each CGU would stillexceed its carrying amount;

reasonable sensitivity to changes in the•long-term growth rate: in a pessimisticscenario where the long-term growth rateis reduced by 0.5 percentage points, the

reasonable sensitivity to changes in the•business plan: a 5% reduction in therevenue forecast contained in thebusiness plan, with variable costs adjustedaccordingly, would not change theconclusions of the Group’s analysis.

Consequently, none of the sensitivity testsreduced the value in use of any of the CGUsto below their carrying amount.



Intangible assets, property, 10.plant and equipment and long-term financial assets

Intangible assets10.1.

Separately acquired intangible assets

Separately acquired intangible assets areinitially measured at cost, whichcorresponds to their acquisition cost ortheir acquisition-date fair value forintangible assets acquired in a businesscombination.

After initial recognition, they are carried atcost less any accumulated amortisationand impairment losses.

Intangible assets with finite useful lives areamortised over their economic useful life.The useful life of concessions, patents andlicences is estimated at between three andseven years.

Intangible assets with indefinite useful livesare not amortised.

Internally generated intangible assets

The Group carries out IT developmentprojects. Expenses incurred in relation tothese operations can be included in thecost of intangible assets. An internallygenerated intangible asset resulting fromdevelopment (or from the developmentphase of an internal IT project) is onlyrecognised if the Group can demonstrateall of the following:

the technical feasibility of completing the•intangible asset so that it will be availablefor use or sale;

its intention to complete the intangible•asset and use or sell it;

its ability to use or sell the intangible•asset;

how the intangible asset will generate•probable future economic benefits;

the availability of adequate technical,•financial and other resources to completethe development and to use or sell theintangible asset;

its ability to reliably measure the•expenditure attributable to the intangibleasset during its development. The initialcost of an internally generated intangibleasset is equal to the sum of expenditureincurred from the date on which theintangible asset first meets theabove-mentioned recognition criteria. Ifno internally generated intangible assetcan be recognised, development costs arerecognised in profit or loss for the year inwhich they are incurred.

After initial recognition, internallygenerated intangible assets are carried atcost less any accumulated amortisationand impairment losses, in accordance withthe same method as that used forseparately acquired intangible assets.

Separately acquired intangible assetsareinitially measured at cost,whichcorresponds to their acquisition costortheir acquisition-date fair valueforintangible assets acquired in abusinesscombination. After initialrecognition, they are carried atcost less anyaccumulated amortisationand impairmentlosses.

The useful life of information systems isestimated at between three andseven years.



Intangible assets acquired in businesscombinations

Intangible assets acquired by the Group inbusiness combinations are measured attheir acquisition cost less any accumulatedamortisation and impairment losses. Theyessentially include operating licences andcomputer software. They are depreciatedon a straight line basis over their usefullives.

The customer portfolio acquired from theECS group was valued using the MEEMmethod (Multi-period Excess EarningsMethod) at €40 million and is beingamortised over 20 years.

The Osiatis brand, fully amortised at theend of 2018, was valued using the royaltyrelief method, based on percentages offorecast revenue and EBIT in line withcomparable market equivalents.

Useful life In years

Amortisable business assets 3–5

ECS customer portfolio 20

Franchises, patents, licences 3–7

IT systems 3–7

Osiatis brand 4

The Group has no intangible assets with indefinite useful lives except for the goodwillpresented in note 9.



2019 Intangible assets

in € millions

Customerportfolio

andbusiness

assets

Franchises,patents,

licences, etc.

IT systemsand otherinternally

generatedassets

Other Total

Acquisition cost

Gross value at 31 December 2018 54.2 38.8 100.8 7.1 200.8

Acquisitions - 1.9 8.8 0.1 10.8

Disposals (retirements) - (3.5) (3.2) (0.8) (7.5)

Changes in scope of consolidation - (0.1) (0.3) - (0.3)

Transfers and other movements - 1.3 (1.4) 0.2 0.1

Reclassification to assets held for sale (0.1) (4.3) (34.2) (0.2) (38.8)

Gross value at 31 December 2019 54.1 34.1 70.5 6.4 165.1

Depreciation and impairment

Accumulated depreciation at 31 December 2018

(30.4) (27.3) (54.2) (5.6) (117.5)

Additions (2.0) (3.4) (12.8) (0.3) (18.5)

Disposals (retirements) - 1.7 2.3 - 4.0

Changes in scope of consolidation - 0.1 0.1 - 0.1

Transfers and other movements - 0.4 (0.4) - -

Reclassification to assets held for sale - 2.2 21.4 0.2 23.8


(32.4) (26.5) (43.4) (5.6) (107.8)

Carrying amount at 31 December 2018 23.8 11.5 46.6 1.5 83.4




Customer portfolios, brands and businessassets are intangible assets which arerecognised in connection with businesscombinations, amortised over the usefullives shown above.

Franchises, patents, licences, etc. consistmainly of licences acquired and amortisedover their useful lives.

IT systems are mainly the result ofdevelopments made by the Group andassociated companies, and are amortisedover the periods set out above.

2018 Intangible assets

in € millions

Customerportfolio

andbusiness

assets

Franchises,patents,

licences, etc.

IT systemsand otherinternally

generatedassets

Other Total

Acquisition cost

Gross value at 31 Dec. 2017 54.2 39.4 81.0 6.9 181.5

Acquisitions - 2.9 20.0 0.8 23.6

Disposals (retirements) - (6.9) (0.4) - (7.3)

Changes in scope of consolidation - 1.9 0.1 - 2.0

Transfers and other movements - 1.6 - (0.6) 1.0

Gross value at 31 Dec. 2018 54.2 38.8 100.8 7.1 200.8


Accumulated depreciation at 31 Dec. 2017

(26.0) (30.1) (41.1) (4.7) (101.9)

Additions (4.4) (4.2) (13.0) (0.4) (22.0)

Disposals (retirements) - 6.9 - - 7.0

Changes in scope of consolidation - (1.4) (0.1) - (1.5)

Transfers and other movements - 1.5 - (0.5) 0.9


(30.4) (27.3) (54.2) (5.6) (117.5)

Carrying amount at 31 Dec. 2017 28.2 9.3 39.9 2.2 79.6




Property, plant and equipment10.2.

Property, plant and equipment ownedoutright

Property, plant and equipment are carriedat acquisition cost less any accumulateddepreciation and impairment losses.

Depreciation is recognised on astraight-line basis over the estimateduseful life of the assets taking into accountany residual value.

Useful life In years

Land Indefinite

Buildings 20–50

Fixtures 5–10

IT equipment 3–7

Vehicles 4–7

Furniture 5–10

Land is not depreciated.

When an item of property, plant andequipment comprises components withdifferent useful lives, such components arerecognised and depreciated separately.

Gains or losses on the sale of an item ofproperty, plant and equipment aredetermined as the difference between theproceeds from the sale and the carryingamount of the asset sold. They are includedin either “Other operating income andexpenses” or “Revenue from continuingoperations” if the sale took place in theordinary course of the Group’s business.

No borrowing costs were included in thecost of any of the Group’s property, plantand equipment in the absence of anyassets requiring a substantial period oftime before they are ready for theirintended use or sale.

Leases

Leases, as defined by IFRS 16, are entered inthe statement of the consolidated financialposition as an asset representing the rightof use of the leased asset during the termof the contract.

On the date that the lease takes effect, theright of use is valued at its cost, including:

the initial amount of the liability, with the•advance payments made to the lessor, netof the benefits received from the lessor;

initial direct costs incurred by the lessee•for the conclusion of the contract; and

the costs of dismantling or restoring the•leased asset according to the terms of thecontract.

The right of use is depreciated over theuseful life of the assets, which leads to adepreciation charge being entered on theincome statement.

On the date that the lease takes effect, therental liability is entered for an amountequal to the discounted value of rents overthe duration of the contract, as defined bythe Econocom group. The valuation of therental liability includes:

fixed rents (including rentals considered•to be fixed in substance);

variable rents based on a rate or index•using the rate or index on the date thecontract comes into effect;

any residual value guarantees awarded to•the lessor;

the exercise price of a purchase option if•the exercise of the option is reasonablycertain; and

penalties for cancellation or non-renewal•of the contract.



The rental liability is recognised at thedepreciated cost, using the effectiveinterest rate method, and leads to therecognition, on the income statement, ofan interest charge for the period andvariable payments (not taken into accountin the initial valuation).

The liability may be revalued to offset theright of use in the following cases:

revision of the term of the contract;•

modification linked to the valuation of the•reasonably certain nature (or not) of theexercise of a purchase option;

change in the amount of payment•expected under the residual valueguarantee awarded to the lessor;

adjustment of rates or indices on which•variable rents are based, when the latterare modified.

Leases mainly relate to property assets andthe vehicle fleet. The accountingexemptions set out in the standard for theshort-term contracts (term below or equalto 12 months), and leases on low valueassets, have been applied.



2019 Property, plant and equipment

in € millionsLand

andbuildings

Fixtures,fittingsand ITequi-

pment

Furnitureand

vehicles

Otherproperty,plant and

equi-pment

Property,plant and

equi-pment

heldunder

financeleases

Rights ofuse Total

Acquisition cost

Gross value at 31 December 2018 19.9 84.8 18.0 12.7 4.2 - 139.5

Application of IFRS 16 - - - - - 45.9 45.9

Acquisitions 1.4 7.1 0.5 2.2 0.1 19.9 31.2

Disposals/Retirements (3.4) (3.6) (0.5) (0.4) - - (7.9)

Transfers and other movements 7.2 (10.4) 5.5 1.6 (3.2) 8.5 (1.7)

Reclassification to assets held for sale - (16.7) (0.7) (0.2) - - (17.6)

Gross value at 31 December 2019 25.0 61.2 11.9 15.9 1.1 74.3 189.3



(9.3) (59.5) (11.3) (6.7) (4.2) - (90.9)

Additions (3.6) (7.3) (0.9) (1.1) (0.1) (25.4) (38.3)

Disposals/Retirements 3.0 3.1 0.5 0.4 - - 6.9

Changes in scope of consolidation - - 1.6 - - (1.6) -

Reversals of impairment - - - - - - -

Transfers and other movements (2.3) 6.8 0.2 (3.9) 3.2 10.6 14.6

Reclassification to assets held for sale - 10.4 0.4 0.1 - - 10.9


(12.2) (46.5) (9.5) (11.3) (1.0) (16.3) (96.8)

Carrying amount at 31 December 2018 10.6 25.2 6.8 6.0 - - 48.6

Carrying amount at 31 December 2019 12.8 14.7 2.4 4.6 0.1 57.9 92.5

Other property, plant and equipment relate to assets in progress.



2018 Property, plant and equipment

in € millions Landand buildings

Fixtures,fittings and

IT equi-pment

Furnitureand vehicles

Otherproperty,plant and

equi-pment

Property,plant and

equi-pment

heldunder

financeleases

Total

Acquisition cost

Gross value at 31 Dec. 2017 26.1 68.7 17.0 11.3 4.2 127.3

Acquisitions 1.2 6.0 1.6 18.6 - 27.4

Disposals/Retirements (0.1) (3.1) (1.0) (11.7) - (15.9)

Changes in scope of consolidation - 1.9 0.5 - - 2.4

Transfers and other movements (7.3) 11.3 - (5.5) - (1.6)

Gross value at 31 Dec. 2018 19.9 84.8 18.0 12.7 4.2 139.5



(10.5) (48.9) (10.2) (6.0) (3.3) (78.9)

Additions (1.3) (9.1) (1.7) (1.0) (0.8) (14.0)

Disposals/Retirements 0.1 2.2 1.0 - - 3.3

Changes in scope of consolidation - (1.7) (0.4) - - (2.1)

Reversals of impairment - - - 0.3 - 0.3

Transfers and other movements 2.5 (2.0) 0.1 - - 0.5


(9.3) (59.5) (11.3) (6.7) (4.2) (90.9)

Carrying amount at 31 Dec. 2017 15.6 19.9 6.8 5.3 0.9 48.4

Carrying amount at 31 Dec. 2018 10.6 25.2 6.8 6.0 - 48.6



Long-term financial assets10.3.

Investments in non-consolidated companies are recorded at fair value. Changes in fairvalue are recognised under Income.

in € millions

Investments innon-con-solidated

companies(1)

Investmentsin associates

and jointventures(2)

Otherlong-term

financialassets(3)

Total

Balance at 31 December 2017 1.5 0.4 29.0 30.9

Increases 1.5 - 3.6 5.1

Repayments/Disposals (0.9) - (1.1) (2.0)

Other cash changes(4) - - (6.1) (6.1)

Changes in scope of consolidation 0.5 - - 0.6

Transfers and other movements - - (0.7) (0.7)

Share of profit (loss) of associates and joint ventures - - - -


Increases 2.4 - 3.0 5.5

Repayments/Disposals (0.2) - - (0.2)

Other cash changes(4) - - 1.4 1.4

Changes in scope of consolidation - - - -

Transfers and other movements 0.4 - (0.5) (0.1)

Share of profit (loss) of associates and joint ventures - - (1.3) (1.3)


This relates to the Group's interest in non-controlled entities for €5.3 million, primarily including shares in Hélios(1)

(€2.4 million), Histovery (€0.8 million), Kartable (€0.5 million), Magic Makers (€0.9 million) and Logosapience (€0.5million).At 31 December 2019, Econocom had only one equity-accounted associate (JTRS).(2)

Other long-term financial assets chiefly correspond to guarantees and deposits.(3)

Other cash variations correspond to net disbursements for factoring guarantees, classified as changes in working(4)

capital requirements in the consolidated statement of cash flow.



Maturity of long-term financial assets

2019 in € millions 1 to5 years

Beyond5 years Indefinite Total

Investments in non-consolidated companies - - 5.3 5.3

Investments in associates and joint ventures - - 0.5 0.5

Guarantees given to factors 13.0 - - 13.0

Other investments - - 8.5 8.5

Other guarantees and deposits 3.9 1.8 - 5.7

Total 16.9 1.8 41.2 32.9

2018 in € millions 1 to5 years

Beyond5 years Indefinite Total

Investments in non-consolidated companies - - 2.6 2.6

Investments in associates and joint ventures - - 0.4 0.4

Guarantees given to factors 12.4 - - 12.4

Other investments - - 5.9 5.9

Other guarantees and deposits 1.9 4.4 - 6.3

Total 14.3 4.4 8.9 27.7

Other long-term receivables10.4.in € millions 31 Dec. 2019 31 Dec. 2018*

Government grants 4.6 7.8

Other long-term receivables 9.0 7.4

Other receivables 13.6 15.2In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*

of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1). The net amount reclassified at 31 December 2019 to“assets held for sale” was €2.6 million.

“Government grants” relate to amountsreceivable under government grants(including at 31 December 2019: €3.8 millionin respect of CICE research tax creditsand €0.5 million in respect of CICEcompetitiveness and employment taxcredits). Other receivables relates to loansgranted to employees or associates.

The carrying amounts of other nonfinancialassets such as other long-term receivables,are reviewed for impairment at the end ofeach reporting date. If the carrying amountof these assets exceeds their estimatedrecoverable amount, an impairment loss isrecognised within operating profit.



By maturity

in € millions 31 Dec. 2019 31 Dec. 2018*

1 to 5 years 13.2 11.2

Beyond 5 years 0.5 4.0

Total 13.6 15.2

In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*

of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1).

Residual interest in leased 11.assets and gross liability commitments for purchases of leased assets

Residual interest in leased assets11.1.

The Group’s residual interest in leasedassets sold to refinancing institutionscorresponds to an estimated market value.Management issues an estimate thatrequires critical judgement.

This residual interest is calculated asfollows:

The residual interest therefore representsa long-term asset which is discountedusing the same method as for the relatedlease. This method does not apply tononstandard cases, which are rare;

for all fixed-term contracts, the estimated•market value is calculated using anaccelerated diminishing balance method,based on the amortisation of the originalpurchase cost of each item of equipment.

for renewable asset management•contracts, the accelerated diminishingbalance method of depreciation is notapplicable. The estimated market value forthese contracts is calculated by using afixed percentage of the original purchasecost of the equipment.


Residual interest in leased assets non-current portion (between 1 and 5 years) 131.9 122.4

Residual interest in leased assets current portion (less than 1 year) 33.0 41.4

Total 165.0 163.8

The Group regularly revises estimates of its residual interest in leased assets using astatistical method based on its experience of second-hand markets.



For more recent assets, for which there isinadequate market data to establish anaccurate valuation, the Group uses aprudent approach which may be adjustedwhen it has access to adequate historicalinformation.

The residual interest recognised at31 December 2019 was €165 million for aportfolio of leased assets representing€6.2 billion (purchase price of the assets oninception of the lease). The Group’s residualinterest in leased assets therefore stood at2.7% of the purchase price of the assets in itsportfolio (versus 2.7% at 31 December 2018).

Change in the Group’s residual interest in2019 is linked solely to the growth inbusiness.

The impact of discounting on the totalamount of the residual interest was€9.6 million at 31 December 2019, thepre-discounted values were €174.6 million at31 December 2019.

Residual interest in leased assets concerns ITassets and industrial assets amountingto €151.9 million and €13.1 million, respectively(€153.0 million and €10.8 million, respectively,at end-December 2018).

Gross liability commitments for purchases of 11.2.leased assets

The Group repurchases leased equipment the related leases. They are classified asfrom refinancing institutions at the end of financial liabilities not consistentthe lease term. These purchase obligations throughout where you use Note or sectionare classified within “gross commitments or none at all. As an example look at theon residual financial value” and recognised notes under the tables earlier in thisin the statement of financial position. They document but are not included in net debtare generally long-term liabilities which are (see 14.3).discounted using the same method as for


Total gross liaibility commitments for purchases of leased assets – non-current portion (between 1 and 5 years) 81.1 73.0

Total gross liaibility commitments for purchases of leased assets – current portion (less than 1 year) 20.4 25.1

Total 101.5 98.1

The present value of items recorded in impact of discounting was €7.2 million in“Gross liability for purchases of leased 2019. The pre-discounted value wasassets” (current and non-current portions) €108.7 million at 31 December 2019.stands at €101.5 million. The cumulative



Operating assets and liabilities12.Inventories12.1.

For the Group, inventories are:

assets held for sale in the ordinary course•of business and measured at the lower ofcost (weighted average cost) and netrealisable value; or

materials or supplies to be used in the•rendering of services, measured at costand impaired in line with the useful life ofthe infrastructure to which they relate.

in € millions

31 Dec. 2019 31 Dec. 2018*

Gross Impair-ment Net Gross Impair-

ment Net

Equipment in the process of being refinanced 21.3 (2.5) 18.8 16.5 (3.0) 13.5

Other inventories 47.9 (6.6) 41.3 55.5 (16.9) 38.6

ICT equipment 35.0 (3.0) 32.0 32.2 (2.5) 29.7

Spare parts 12.9 (3.6) 9.3 23.3 (14.5) 8.8

Total 69.2 (9.1) 60.1 72.0 (19.9) 52.1In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*

of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1). Here it does not say see Section or see Note. As per myearlier comment, these all need to be consistent in document.

Gross value


Changesin inven-

tories

Changesin scope

ofconsoli-

dation

Reclassi-fication

to assetsheld for

sale

Otherchanges

31 Dec.2019

Equipment in the process of being refinanced

16.5 4.8 - - - 21.3

Other inventories 55.5 8.7 (1.6) (14.5) (0.3) 47.9

ICT equipment 32.2 4.8 (1.6) (0.2) (0.3) 35.0

Spare parts 23.3 3.9 - (14.3) - 12.9

Total 72.0 13.5 (1.6) (14.5) (0.3) 69.2



Impairment

in € millions 31 Dec.2018 Additions Reversals

Reclassi-fications

underassets

held forsale

Otherchanges

31 Dec.2019

Equipment in the process of being refinanced

(3.0) - 0.5 - - (2.5)

Other inventories (16.9) (2.0) 1.9 10.4 0.1 (6.6)

IT equipment and telecoms (2.5) (1.2) 0.5 - 0.1 (3.0)

Spare parts (14.5) (0.8) 1.3 10.4 - (3.6)

Total (19.9) (2.0) 2.4 10.4 0.1 (9.1)

Trade and other receivables and other current 12.2.assets

in € millions

31 Dec. 2019 31 December 2018*

Gross Impair-ment Net Gross Impair-

ment Net

Trade receivables 1,064.3 (63.9) 1,000.4 1,240.9 (57.9) 1,183.0

Other receivables 103.4 (10.1) 93.3 91.2 (5.6) 85.6

Trade and other receivables 1,167.7 (74.0) 1,093.7 1,332.1 (63.5) 1,268.6

Costs of performanceand obtention of contract recognised as an asset*

30.6 30.6 31.3 - 31.3

Other current assets 27.8 27.8 34.9 - 34.9


of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1). The net amounts reclassified at 31 December 2019 asassets held for sale were €67.7 million for trade and other receivables, €3.7 million for contract performance andobtention costs and €1.7 million for the other current assets.



Trade receivables items are broken down below by business, net of impairment.

in € millions

31 Dec. 2019 31 Dec. 2018*

Recei-vables

invoiced,net of

impair-ment

Outstan-ding

rentalsRevenueaccruals Total

Recei-vables

invoiced,net of

impair-ment

Outstan-ding

rentalsRevenueaccruals Total


354.4 389.6 6.8 750.8 326.3 455.6 10.0 791.9


155.8 - 93.8 249.6 232.6 - 158.5 391.1

Total 510.2 389.6 100.6 1,000.4 558.9 455.6 168.5 1,183.0


of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1). The net amounts reclassified at 31 December 2019 asassets held for sale were €59.4 million.

At end-2019, the €389.6 million in portion of the €389.6 million includes notoutstanding rentals includes a portion that is only self-funded outstanding rentals but alsoself-funded or refinanced with recourse for a a portion that will be refinanced, i.e., when agross amount of €238.5 million, of which refinancing agreement exists. €162.7 million is non-current. The current

Impairment of receivables

Initially, receivables are impaired takinginto account expected credit losses, ifmaterial:

short-term receivables (mainly for the DSS•business) are impaired on the basis of anaverage observed risk of default. Thisapproach is based on the default ratesobserved individually by each of theGroup’s subsidiaries;

long-term receivables (mainly for the TMF•business) are impaired by taking intoaccount the customer’s risk profile, thevalue of the underlying assets and aprobability of occurrence.

Subsequently, if there is serious doubt as toits recoverability, a loss allowance isrecognised for the amount that is notrecoverable.

in € millions31 Dec.

2018 Additions Reversals Otherchanges

Reclassi-fication under

assets heldfor sale

31 Dec.2019

Impairment of doubtful receivables

(57.9) (17.6) 10.6 (0.6) 1.6 (63.9)



Other receivables

Other receivables represent amounts receivable from the French State and miscellaneousamounts due from third parties (suppliers, factor, etc.):


Tax receivables (excl. income tax) 38.9 35.4

Factoring receivables 36.1 11.4

Government grants receivable 4.1 7.1

Due from suppliers 9.4 18.1

Other 4.7 13.7

Other receivables 93.3 85.6In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*

of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1). The total net amount reclassified at 31 December 2019to assets held for sale was €8.3 million.

Other current assets

Other current assets mainly relate to prepaid expenses totalling €27.6 million after thereclassification of €1.7 million at 31 December 2019 as assets held for sale and €34.7 millionat 31 December 2018.

Trade and other payables12.3.in € millions 31 Dec. 2019 31 Dec. 2018*

Trade payables 756.9 854.0

Other payables 223.7 250.2

Trade and other payables 980.6 1,104.2In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*

of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1). The total net amount reclassified at 31 December 2019to liabilities held for sale was €43.6 million.

Other payables can be analysed as follows:

in € millions 31 Dec. 2019 31 Dec. 2018 *

Tax and social liabilities 212.5 235.3

Dividends payable 1.2 0.9

Customer prepayments and other payables 10.0 14.0

Other payables 223.7 250.2In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*




Other current liabilities12.4.Other current liabilities break down as follows:


Contract liabilities* 68.7 85.8Contingent acquisition-related liabilities - current portion 2.4 28.0 58.9

Deferred income 134.3 119.3

Other liabilities 7.4 11.1

Other current liabilities 169.7 189.3In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*


Other non-current liabilities12.5.


Acquisition-related liabilities – non-current portion 2.4 38.0 65.2

Other non-current liabilities(1) 4.4 4.6

Other non-current liabilities 42.4 69.9


of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1).

Including €2.3 million in miscellaneous cash deposits received at 31 December 2019 (€1.9 million at 31 December(1)

2018).

Financial instruments13.Financial instruments comprise:

financial assets, which include long-term•financial assets (except investments inequity-accounted companies), otherlong-term receivables, trade and otherreceivables, other current assets, and cashand cash equivalents;

financial liabilities, which include current•and non-current financial liabilities andbank overdrafts, operating payables andother current and non-current liabilities;and

derivative instruments.•



Classification and measurement of financial 13.1.instruments

Financial instruments (assets and liabilities)are recorded in the consolidated statementof financial position at their fair value oninitial recognition, plus in the case of anasset that is not subsequently recognisedat fair value through profit or loss,transaction costs directly attributable tothe acquisition of that asset.

They are subsequently measured at eitherfair value (through profit or loss, or throughother comprehensive income) or amortisedcost, depending on their nature.

The classification of a financial asset in eachof these categories depends on themanagement model applied to it by thecompany and the characteristics of itscontractual cash flows.

In practice, trade receivables are measuredaccording to the amortised cost method,even though they may be subject to anassignment of receivables, for example, inthe context of factoring.

The Group applies the concept of fair valueset out in IFRS 13 – Fair Value Measurement,whereby fair value is “the price that wouldbe received to sell an asset or paid totransfer a liability in an orderly transactionbetween market participants at themeasurement date (exit price)”.

effective interest rate and less cashoutflows (coupons, principal repaymentsand, where applicable, redemptionpremiums). Accrued interest (income andexpenses) is not recorded at the nominalinterest rate of the financial instrument, butbased on the instrument’s effective interestrate. Financial assets at amortised cost aretested for impairment whenever there areindications that they may be impaired.

Amortised cost represents the fair value oninitial recognition (net of transaction costs),plus interest calculated based on the

Any loss of value is recognised in theincome statement.

The initial recognition of financialinstruments in the consolidated statementof financial position along with theirsubsequent measurement as describedabove apply the following interest ratedefinitions:

the coupon rate (coupon), which is the•nominal interest rate on the instrument;

the effective interest rate;•

the market interest rate, which is the•effective interest rate as recalculated atthe measurement date in line withordinary market inputs.

Financial instruments carried in both assetsand liabilities are derecognised wheneverthe related risks and rewards are sold andthe Group ceases to have control overthose financial instruments (see note 21).



Derivative financial instruments13.2.

The Group uses the financial markets onlyfor hedging exposure related to its businessactivities and not for speculative purposes.

Given the low exchange rate risk, forwardpurchases and sales of foreign currencyare recognised as instruments measured atfair value through profit or loss.

Schuldschein notes. This financialinstrument is designated as a cash flowhedge and is eligible for hedge accountingunder IFRS 9.

The Group uses an interest rate swap tohedge its interest rate risk on afloating-rate tranche of its new

Gains or losses on the hedging instrumentare recognised directly in othercomprehensive income until the hedgeditem is itself recognised in the incomestatement. Hedging reserves are thentransferred to the income statement.

31 Dec. 2018Change

through profitor loss

Othercomprehensive

income(expense)(1)

31 Dec. 2019

Derivative instruments (positive fair value) - - - -

Derivative instruments (negative fair value)(1) 0.7 - 0.2 0.9

Total - (0.2)

Changes in fair value of the instrument hedging Schuldschein notes.(1)

Classification of financial instruments and fair 13.3.value hierarchy

IFRS 7 – Financial Instruments: Disclosuressets out a fair value hierarchy, as follows:

Level 1: fair value based on quoted prices•in active markets;

Level 2: fair value measured using•observable market inputs (other than thequoted market prices included in Level 1);

Level 3: fair value measured using•unobservable market inputs.

market price is available, fair value ismeasured using other valuation methodssuch as discounted future cash flows.

The fair value of financial instruments isdetermined using market prices resultingfrom trades on a national stock exchangeor over-the-counter markets. When no

In any event, estimates of market value arebased on certain interpretations requiredwhen measuring financial assets.

As such, these estimates do not necessarilyreflect the amounts that the Group wouldactually receive or pay if the instrumentswere traded on the market. The use ofdifferent estimates, methods andassumptions may have a material impacton estimated fair values.



In view of their short-term nature, thecarrying amount of trade and otherreceivables, and cash and cash equivalentsapproximates their fair value.

Derivative financial instruments aremeasured using Level 2 fair values.

Cash equivalents are recognised at fairvalue (Level 1).

FINANCIAL ASSETS13.3.1.

The Group’s financial assets at 31 December 2019 can be analysed as follows:

in € millions Carrying amount Level in the fair value hierarchy

Statement of financial position headings Notes

Amor-tisedcost

Fair valuerecognised

throughother

compre-hensiveincome

Fairvalue

throughprofit

or loss

Level 1 Level 2 Level 3

Long-term financial assets 10.3 27.2 - 5.8 - 32.9 -

Long-term receivables 10.4 13.6 - - - 13.6 -

Trade receivables 12.2 1,000.4 - - - 1,000.4 -

Other receivables 12.2 93.3 - - - 93.3 -

Cash and cash equivalents 14.1 - - 593.8 593.8 - -

Financial assets 1,134.5 - 599.6 593.8 1,140.2 -

FINANCIAL LIABILITIES 13.3.2.AND OTHER LIABILITIES

In view of their short-term nature, thecarrying amount of trade and otherpayables approximates fair value.

The market value of derivative instrumentsis measured based on valuations providedby bank counterparties or models widelyused in financial markets, on the basis ofdata available at the reporting date.



in € millions Carrying amount Level in the fair value hierarchy

Statement of financial position headings

NotesAmor-

tisedcost

Fairvalue

throughprofit or

loss

Fairvalue

throughequity

Level 1 Level 2 Level 3

Gross debt 14.2 14.1 827.8 18.2 - 18.2 827.8 -

Non convertible bonds 225.2 - - - 252.2 -

Convertible bonds 189.2 - - - 189.2 -

Bank debt, commercial paper and other 292.0 18.2 - 18.2 292.0 -

Liabilities relating to contracts refinanced with recourse

94.3 - - - 94.3 -

Lease liabilities 59.2 - - - 59.2 -

Non-current non interest-bearing liabilities 12.5 4.4 2.0 36.0 - 4.4 38.0

Gross liability for purchases of leased assets 11.2 101.5 - - - 101.5 -

Trade payables 12.3 756.9 - - - 756.9 -

Other payables (excluding derivative instruments) 12.3 222.8 - - - 222.8 -

Other current (financial) liabilities 12.4 7.4 1.8 26.1 - 7.4 28.0

Financial liabilities 1,980.0 22.0 62.1 18.2 1,980.0 66.0

Non-current non-interest-bearing liabilitiesand other current liabilities estimated atfair value through profit or loss (Level 3)correspond to contingent considerationliabilities arising on acquisitions ofcompanies for €3.8 million (See 2.4).

options on noncontrolling interests for€62.1 million (see 2.4).

Non-current non-interest-bearing liabilitiesand other current liabilities estimated atfair value through equity (Level 3)correspond to liabilities under put and call

Contingent consideration liabilities aremeasured based on the estimated futureperformance of the entities concerned (e.g.,EBIT multiples, expected future cash flows,etc.).

Based on the information held by theGroup, the fair value of financial liabilitiesapproximates their carrying amount.



Cash, gross debt and net debt14.Cash and cash equivalents14.1.

These include cash on hand and demand current liabilities in the statement ofdeposits, other highly-liquid investments financial position.with maturities of three months or less, andbank overdrafts. Bank overdrafts areincluded in “Financial liabilities” within

Changes in fair value are recognisedthrough profit or loss under “Financialincome – operating activities”.

Cash as presented in the statement of cash cash equivalents can be broken down asflows includes cash and cash equivalents, follows at end-2018 and end-2019:presented net of bank overdrafts. Cash and


31 Dec.2018*

Cash in hand 588.3 605.0

Demand deposits 0.1 0.3

Sight deposits 588.2 604.7

Cash equivalents 5.5 3.4

Term accounts 2.1 1.8

Marketable securities 3.4 1.6


Bank overdrafts (18.2) (3.6)

Cash and cash equivalents net of bank overdrafts 575.6 604.8In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*


The cash and cash equivalent balances but not wholly owned by the Group totalledcorresponding to the share of Econocom’s €85.5 million at 31 December 2019 versuspartners in companies fully consolidated €72.6 million at 31 December 2018.



Gross debt14.2.


31 Dec.2018*

Convertible bond debt (OCEANE) 188.2 184.5

Nonconvertible bond debt (Euro PP) 54.7 99.5

Nonconvertible bond debt (Schuldschein) 147.1 147.1

Bonds – non current 390.0 431.1

Other debt 2.8 4.1

Finance lease liaibilities(1) 58.8 68.8

Financial liabilities – non-current 61.6 73.0

Non-current interest-bearing liabilities 451.5 504.1

Convertible bond debt (OCEANE) – current portion 1.0 1.0

Nonconvertible bond debt (Euro PP) – current portion 47.6 2.7

Nonconvertible bond debt (Schuldschein bond) – current portion 2.8 2.7

Bonds – current portion 51.5 6.4

Commercial paper and other bank borrowings 289.2 283.0

Factoring payables(2) 4.0 28.5

Other current borrowings and debt with recourse - -

Finance lease liabilities (1) 31.6 34.4

Financial liabilities – current portion(3) 324.8 346.0

Current interest-bearing liabilities 376.3 352.4

Gross debt total(3) 827.8 856.5In accordance with the specifications of the standards, data at 31 December 2018 are not restated for the impact*

of the application of IFRS 5 from 1 January 2019 (see 1.1.1.1).Primarily liabilities relating to contracts refinanced with recourse. This debt is backed by customers’ rental(1)

payments in which the Group retains a portion of the credit risk. The Group has therefore added back a similaramount of unassigned receivables in accordance with IAS 32 – Financial Instruments: Presentation.Factoring liabilities consist of residual risks arising from factoring agreements.(2)

Excluding current bank overdrafts.(3)



Convertible bonds

In March 2018, Econocom group issuedOCEANE bonds in the amount of €200million (€198.4 million after allocation ofissue costs). Their main characteristics aredetailed below:

maturity: five years;•

annual coupon: 0.5%;•

issue price: €8.26.•

If these bonds are not converted, they willbe redeemed in cash on 6 March 2023 at aprice of €10.73.

OCEANE bonds are compound instrumentswithin the meaning of IAS 32. Thecharacteristics of the OCEANE bondsprovide for the possibility of conversion intoa fixed number of shares for a fixed amountof cash. An equity component has beencalculated by subtracting the debtcomponent of the OCEANE, measured atthe rate of the debt without a conversionoption, in application of sections 29–30 ofIAS 32, which define the “equity”component as residual. On initialrecognition, and net of issue costs, theequity component amounted to €16.7million and the debt component to €181.7million.

Nonconvertible bonds

Euro PP

In May 2015, Econocom Group SE took partin a €101 million bond issue (Euro PP) witheight institutional investors. The issue wasin two tranches of €45.5 and €55.5 million,with respective maturities of five andseven years. They pay fixed-rate interest(2.364% in five years and 2.804% inseven years) and are redeemable uponmaturity (in fine).

Schuldschein notes

In late November 2016, EconocomGroup SE issued €150 million inSchuldschein notes on the Frankfurtmarket.

These notes, redeemable at maturity,comprise three tranches: €13 million atseven years, and €22 million and€115 million at five years. Notes belongingto the first two tranches pay fixed-rateinterest (2.088% at seven years and 1.611% atfive years). The interest on the third trancheincludes a fixed-rate portion of 1.5% and afloating-rate portion indexed to six-monthEURIBOR. An interest rate swap was put inplace in respect of these notes to protectthe Group against the interest rate risk onthe floating-rate portion. The swap hedgesthe risk of a rise in interest rates; however, itprovides that if EURIBOR is negative,Econocom bears the interest rate risk.

Commercial paper

In October 2015, Econocom diversified itsfinancing and set up a commercial paperprogramme (Econocom Group SociétéEuropéenne Billets de Trésorerie). Throughthis programme, capped at €450 million,the Group optimises and diversifies in theshort term the financial resources tosupport its growth. This programmecomplements the Group’s bank financingand gives it access to short-term liquidityunder favourable and transparentconditions, since it borrows from thenegotiable debt securities market.



Analysis of non-current interest-bearing liabilities by maturity

2019 in € millions Total 1 to 5 years Beyond5 years

Lease payables relating to contracts refinanced with recourse (non-current portion) 58.8 58.8 -

Bonds 390.0 390.0 -

Other debt 2.8 2.8 -

Total 451.5 451.5 -

2018 in € millions Total 1 to 5 years Beyond5 years

Lease payables relating to contracts refinanced with recourse (non-current portion) 65.0 65.0 -

Finance lease liabilities – real estate 0.1 0.1 -

Finance lease liabilities – non-real estate 3.7 3.7 -

Bonds 431.1 431.1 -

Other debt 4.1 4.1 -

Total 504.1 504.1 -

Net debt14.3.

The concept of net debt as used by theGroup represents gross debt (see note 14.2)less gross cash (see note 14.1 – cash andcash equivalents). Gross debt includes allinterest-bearing debt and debt incurredthrough the receipt of financialinstruments.

It does not include:

the gross purchase commitments of•leased assets (liaibility) and residualinterests in leased assets;

the derivative instrument hedging•Schuldschein notes; and

lease liabilities.•



Net debt 2019


Cashflows

Non-cashflows

31 Dec.2019

Amortisedcost of the

loan

Conver-sion

Reclassi-fication

toliabilities

held forsale

Other

Cash and cash equivalents * 608.4 (4.9) - 0.8 (10.5) - 593.8

Bank overdrafts ** (3.6) (14.7) - - - - (18.2)

Cash and cash equivalents net of bank overdrafts(1)

604.8 (19.5) - 0.8 (10.5) - 575.6

Commercial paper and bank debt (287.1) (5.0) - - 0.1 - (292.0)

Net cash at bank 317.7 (24.6) - 0.8 (10.4) - 283.6Convertible bond (OCEANE) (185.5) 1.0 (4.7) - - - (189.2)

Bond (Euro PP) (102.2) 2.6 (2.7) - - - (102.3)

Bond (Schuldschein) (149.8) 2.8 (2.9) - - - (149.9)

Leases refinanced with recourse (97.2) 6.9 - - - - (90.3)

Factoring liabilities with recourse (28.5) 20.3 - - 4,3 - (4.0)

Other non-current liabilities (6.1) - - - - 6.1 -

Sub-total (569.4) 33.6 (10.3) - 4.3 6.1 (535.8)

Net debt (251.7) 9.0 (10.3) 0.8 (6.1) 6.1 (252.2)Positive gross cash and cash equivalents.*

Including current bank overdrafts totalling €18.2 million at 31 December 2019 and €3.6 million at 31 December**

2018.

The -€29.3 million change in net cash and cash equivalents as shown in the statement of cash flows is equal to(1)

the sum of monetary outflows (-€19.5 million), translation adjustments (€0.8 million), and reclassification underliabilities held for sale (-€10.5 million).

The net debt in 2019 includes in particular €238.5 million corresponding to TMFcontracts, self-funded with recourse.



Net debt 2018


Cashflows

Non-cashflows31 Dec.

2018Newly

consolidatedcompanies

Amortisedcost of

the loanConversion Other

Cash and cash equivalents* 237.9 356.1 13.6 - 0.8 - 608.4

Bank overdrafts** (5.1) 1.5 (0.1) - - - (3.6)

Cash and cash equivalents net of bank overdrafts(1)

232.9 357.6 13.5 - 0.8 - 604.8

Commercial paper (130.8) (155.7) (0.5) - 0.1 (0.2) (287.1)

Net cash at bank 102.0 201.9 13.1 - 0.9 (0.2) 317.7Convertible bond (ORNANE) - (184.5) - (1.0) - - (185.5)

Bond (Euro PP) (102.1) 2.5(2) - (2.6) - - (102.2)

Bond (Schuldschein) (149.7) 2.7(2) - (2.8) - - (149.8)

Leases with recourse (108.8) 11.6 - - - - (97.2)

Factoring liabilities with recourse (12.2) (16.3) - - - - (28.5)

Other liabilities with recourse (3.1) 3.1 - - - - -

Finance lease liabilities (4.7) - (1.4) - - - (6.1)

Sub-total (380.6) (180.9) (1.4) (6.4) - - (569.4)

Net debt (278.6) 20.9 11.7 (6.4) 0.9 (0.1) (251.7)

Positive gross cash and cash equivalents.*

Including current bank overdrafts totalling €3.6 million at 31 December 2018 and €5.1 million at 31 December 2017.**

The €372.0 million change in net cash and cash equivalents as shown in the statement of cash flows is equal to(1)

the sum of monetary outflows (€357.6 million) and cash resulting from newly consolidated companies(€13.5 million) less translation losses (€0.8 million).Monetary flows on Nonconvertible bonds corresponds to €5.4 million of interest paid over the year. These interest(2)

paid are shown within “Interest paid” in the consolidated statement of cash flows.



Equity15.Share capital15.1.

Following the exercise of 120,000 subscription options, Econocom Group SE issued 240,000new shares on 21 June 2019, increasing its share capital to €23,512,79.67. The total number ofshares with voting rights attached was thus increased to 245,380,430.

Number of shares Value in € millions

Total Treasuryshares(1) Outstanding Share

capitalIssue

premiumTreasury

shares

At 1 January 2018 245,140,430 9,529,793 235,610,637 23.5 253.0 (58.1)

Purchases of treasury shares, net of sales - 5,858,838 (5,858,838) - - (15.6)

Exercise of options and award of free shares - (1,410,000) 1,410,000 - - 9.1

OCEANE equity component - - - - 16.7 -

Refund of issue premium - - - - (29.4) -

At 31 December 2018 245,140,430 13,978,631 231,161,799 23.5 240.3 (64.6)

Purchases of treasury shares, net of sales - 9,564,513 (9,564,513) - - (26.3)

Exercise of options and award of free shares (85,000) 85,000 - - 0.0

Capital increase 240,000 - - - 0.7 -

Refund of issue premium - - - - (27.4) -

At 31 December 2019 245,380,430 23,458,144 221,922,286 23.5 213.6 (90.9)

At 31 December 2019, all of the shares are in its own account. At 31 December 2018, 13,854,631 shares were in its(1)

own account and 124,000 were part of the liquidity agreement.

The number of dematerialised shares stands at 183,046,396.

The number of registered shares is 62,334,034, a total of 245,380,430.



Bearer shares

At 31 December 2017, following the sharesplit on 2 June 2017, a total of 1,093,844shares were recorded in the name of Caissedes Dépôts et Consignations in the Group’sshare register.

Caisse des Dépôts et Consignations in ourregister therefore amounts to 1,092,156shares.

During the 2018 fiscal year, only oneshareholder claimed its shares (1,688 sharesafter the split) from Caisse des Dépôts etConsignations. The number of EconocomGroup shares registered in the name of

In 2019, following claims from twoshareholders (for a total of 6,488 shares)from Caisse des Dépôts et Consignations,the number of Econocom Group sharesregistered in the name of Caisse desDépôts et Consignations in our registertherefore amounts to 1,085,668 shares.

Changes in equity attributable to owners of the 15.2.parentAt 31 December 2019, equity attributable to owners of the parent amounted to €410.2million (€396.4 million at 31 December 2018). The table below shows changes in this item:

in € millions Attributable toowners of the parent

At 31 December 2018 396.4

IFRS 16 Leases (Lessee) impact (3.0)

At 1 January 2019 393.4

Comprehensive income 45.5

Share-based payments, net of tax 0.7

Refund of issue premium, net (27.4)

Capital increase 0.7

Treasury share transactions (26.3)

Transactions on stock options -

Change in fair value of liabilities under put options 3.2

Impact of put options granted to non-controlling shareholders 8.1

Reclassifications of reserves attributable to owners of the parent/non-controlling interests further to additional acquisitions 6.3

Miscellaneous (transactions impacting non-controlling interests and other transactions)* 6.1

At 31 December 2019 410.2Primarily concern the disposal of Rayonnance:*



Changes in equity not recognised in profit or loss15.3.

ECONOCOM GROUP 15.3.1.SHARE-BASED PAYMENTS

The Group regularly awards stock purchaseand subscription options, as well as freeshares, to Management, certain corporateofficers and select employees. Thesetransactions are recognised at fair value atthe grant date using theBlack-Scholes-Merton mathematical optionpricing model.

straight-line basis in "Personnel costs" overthe vesting period. An offsetting entry isrecorded to equity. Subsequent changes inthe fair value of the options do not impactthe initial measurement.

Fair value, corresponding to the estimatedcost of the services provided by thebeneficiaries, is recognised on a

At the end of each reporting period, theGroup revises the assumptions used tocalculate the number of equityinstruments. The impact of this revisedestimate, if any, is taken to profit or loss andthe expenses accrued adjusted accordingly.The offsetting entry is recorded in equity.

Stock subscription option 15.3.1.1.plans

expensed over the vesting period. Whenthe options are exercised, equity isincreased by the proceeds received.

Stock options have been granted to someof the Group’s employees and corporateofficers for an agreed unit price. Stockpurchase and stock subscription optionplans are equity-settled share-basedpayment transactions. In accordance withthe number of options expected to vest,the fair value of the options granted is

The characteristics of these plans aredetailed below. It should be noted that thenumber of options granted remainsunchanged but that owing to the sharesplit, the number of rights attached to eachoption has doubled.



Stock option plans 2013 Options 2014 Options(1) 2017

Options(2)Total

Year granted 2013 2014 2015 2016 2017

Options outstanding at 31 December 2018 250,000 1,784,000 357,500 95,000 90,000 2,576,500

Options granted during the period - - - - - -

Options exercised during the period - (120,000) - - - (120,000)

Options lapsed, forfeited or cancelled - (64,380) (700) (10,000) - (75,080)

Options outstanding at 31 December 2019 250,000 1,599,620 356,800 85,000 90,000 2,381,420

Rights granted in number of shares (comparable) at 31 December 2018

500,000 3,568,000 715,000 190,000 90,000 5,063,000

Rights granted in number of shares (comparable) at 31 December 2019

500,000 3,199,240 713,600 170,000 90,000 4,672,840

Option exercise price (in €) 5.96 5.52 7.70 11.48 6.04 -

Share purchase price (in €) 2.98 2.76 3.85 5.85 6.04 -

Average share price at the exercise date 5.52 - - - -

Expiry date Dec.2020

Dec.2021

Dec.2022

Dec.2023

Dec.2023 -

In December 2014, the Board of Directors approved a plan to issue 2,500,000 stock subscription rights. These(1)

options were issued by the Compensation Committee in 2014 (2,075,000 options), 2015 (360,000 options) and 2016(105,000 options). The formula adopted will allow Econocom Group to issue new shares upon exercise of theseoptions.In May 2017, the Board of Directors approved a plan to issue 2,000,000 stock subscription rights, 1,950,000 of(2)

which were issued in December 2017 by the Compensation Committee. These options will also give rise to theissue of new shares.



The fair values of the options were measured at the grant date using theBlack-Scholes-Merton mathematical option pricing model. The table below shows themeasurements along with the main assumptions used:

General information Initial measurement assumptions (IFRS 2)

Plan Year granted

Optionsoutstanding Fair value Volatility Vesting

period

Estimatedfuture

dividend in %RFIR(1)

2013 2013 250,000 1.21 24% 4 years 2% 1.14%

2014

2014 1,599,620 0.73 28% 4 years 2% 0.32%

2015 356,800 1.00 28% 4 years 2% 0.35%

2016 85,000 1.65 30% 4 years 2% 0.02%

2017 2017 90,000 1.08 29% 4 years 2% 0.13%

RFIR: risk-free interest rate.(1)

Options are measured at fair value at thegrant date in accordance with IFRS 2.

Volatility is calculated by an actuary basedon a four-year record of daily pricespreceding the option grant date, in linewith the maturity of the options.

A detailed description of these stock optionplans can be found in section 5.10 of theManagement Report.

Free share plan15.3.1.2.

In 2019, the Econocom Board of Directorsdid not award free shares.

Vesting may be subject to the achievementof individual and/or collective objectives,that may be internal and/or external to theEconocom Group. As at 31 December 2019,790,000 free shares had not beenexercised.



2016 2018 Total

Tranches 3 1 2 3 4 5

Free shares outstanding at 31 Dec. 2018

140,000 15,000 402,500 342,500 342,500 342,500 1,585,000

Award - - - - - - -

Vesting (70,000) (15,000) - - - - (85,000)

Exercise - - - - - - -

Loss (70,000) - (205,000) (145,000) (145,000) (145,000) (710,000)

Free shares outstanding at 31 Dec. 2019

- - 197,500 197,500 197,500 197,500 790,000

Expiry date May2019

Feb2019

March2020

March2021

March2022

March2023 -

Each tranche is contingent on theemployee being present in the Groupthroughout the vesting period, and on aseries of conditions relating to performanceand share price.

Econocom Group 15.3.1.3.share-based payment expense in the income statement

The total expense taken to profit or loss in2019 in respect of share-based paymentsamounted to €0.7 million, and wasrecorded in personnel costs withinrecurring operating profit. A tax effect wasrecognised for an amount that was notmaterial.

operating profit. A tax effect wasrecognised for an amount that was notmaterial.

The total expense taken to profit or loss in2018 in respect of share-based paymentsamounted to €1.1 million, and was recordedin personnel costs within recurring

PROVISIONS FOR PENSIONS 15.3.2.AND OTHER POST-EMPLOYMENT BENEFIT OBLIGATIONS

The impact of provisions for pensions andother post-employment benefits onconsolidated equity is set out in note 17.

TREASURY SHARES15.3.3.

Treasury shares and the related transactioncosts are recorded as a deduction fromequity. When they are sold, theconsideration received in exchange for theshares net of the transaction costs isrecorded in equity.



At 31 December 2019, the Group held23,458,144 treasury shares (i.e., 9.6% of thetotal number of shares) through the parentcompany Econocom Group SE.

The net acquisition cost of shares acquiredand the proceeds from the sale of sharessold were respectively deducted from oradded to equity.

DIVIDEND15.3.4.

The Board of Directors recommends that at the Annual General Meeting shareholders voteto refund the issue premium considered as paid-in capital, in an amount of €0.12 per share.The table below also shows the dividend per share paid by the Group in respect ofprevious years.

Issue premiumrefund proposed

in 2020Issue premium

refunded in 2019Issue premium

refunded in 2018

Total dividend in € millions(1) 29.4 29.4 29.4

Dividend per share in € (after the share split) 0.12 0.12 0.12

Calculated based on the total number of shares outstanding at 31 December of each year.(1)

As this refund of the issue premium issubject to the approval of the AnnualGeneral Meeting, it is not recognised as aliability in the consolidated financialstatements for the year ended31 December 2019.

CURRENCY TRANSLATION 15.3.5.RESERVES

of subsidiaries with functional currenciesother than the euro. Foreign exchangegains and losses recorded in equityattributable to owners of the parent andnon-controlling interests represented adecrease of €5.7 million versus a decreaseof €6.5 million at 31 December 2018. At31 December 2019, changes in this itemresult chiefly from fluctuations in the valueof the pound sterling, Brazilian real, SwissCurrency translation reserves correspond tofranc and Polish zloty.the cumulative effect of the consolidation



Change in non-controlling interests15.4.At 31 December 2019, non-controlling interests amounted to €73.7 million (€94.9 million at31 December 2018). The table below shows changes in this item:

in € millions Non-controllinginterests


Share of comprehensive income attributable to non-controlling interests 3.9

Impact of put options granted to non-controlling shareholders (8.1)

Reclassifications between equity attributable to owners of the parent and non-controlling interests following acquisitions of additional shares (6.3)

Miscellaneous transactions impacting reserves* of non-controlling interests (10.8)


Primarily concern the disposal of Rayonnance*

The share of profit recognised in the income statement for non-controlling interestsrepresents +€3.9 million for 2019 (compared with +€5.2 million in 2018).

Information regarding non-controlling interests15.5.At 31 December 2019, non-controllinginterests primarily concerned Econocom’s“Satellites” in the Digital Services &Solutions activity: Altabox, Alter Way,Asystel Italia, Bizmatica, Econocom DigitalSecurity, Exaprobe, Helis, Infeeny andEnergyNet.

Econocom Group’s total assets orconsolidated equity.

Together these companies accounted for13.4% of total assets and 27.2% ofconsolidated equity at 31 December 2019.Taken individually, none of these entitiesrepresents a significant percentage of

Current accounts granted to thesecompanies by Econocom Finance SNCamounted to €18.8 million at 31 December2019.

After eliminating items between thesecompanies and other Group companies,these entities contributed €605.9 million torevenue in 2019 (€578.6 million in 2018).



Provisions16.The Group recognises provisions when ithas a legal or constructive obligationtowards a third party as a result of pastevents which is likely to result in an outflowof resources that can be measured reliably.

The amount recognised represents the bestestimate of the expenditure expected to berequired to settle the present obligation,taking into account the risks anduncertainties known at the reporting date.

Long-term provisions

Long-term provisions cover risks which arenot reasonably expected to materialise forseveral years, and concern employee-relatedrisks. They are discounted if required.

Short-term provisions

Short-term provisions primarily correspondto provisions for claims related to theGroup’s normal operating cycle and whichare expected to be settled within 12months.

They mainly include:

provisions for employee-related risks•(including risks arising from reorganisationmeasures);

tax and legal risks (disputes in progress•with clients, suppliers, agents or taxauthorities);

deferred commissions, (calculated•contract-by-contract based on the residualvalue of leased assets, less any residualcommercial value of the contractsconcerned);

other provisions.•

Some disputes are described in note 24 – Assessments made by Management and sourcesof uncertainty.

Contingent liabilities

Other than the general risks described in note 19, the Group did not identify any materialrisks not provisioned in its financial statements.

Provisions for restructuring and employee-related risks

Provisions for restructuring and employee-related risks in the amount of €6.7 million coverfuture costs related particularly to the ongoing transformation of the Digital Services &Solutions business line, on the one hand, and litigation with former employees, on theother.

Provisions for tax, legal and commercial risks

This item includes provisions for legal and commercial risks in the amount of €17.2 million,which mainly cover the risks related to ongoing litigation with clients.

Provisions for other risks

Provisions for other risks (€8.5 million) cover risks of a very varied nature, of which nearlythree-quarters in France.



Change in 2019 provisions


Addi-tions

Reversalsnot used

Rever-sals

(used)IFRS 5

Otherand ex-change

diffe-rences

31 Dec.2019

Restructuring and employee-related risks 7.3 3.2 (0.9) (2.4) (0.5) - 6.7

Tax, legal and commercial risks 17.4 11.2 (2.6) (5.2) (1.7) - 19.2

Deferred commissions 1.7 0.1 (0.3) - - - 1.5

Other risks 17.2 4.3 (4.0) (0.2) (5.1) (3.8) 8.5

Total 43.7 18.9 7.8 (7.8) (7.4) (3.8) 35.8

Long-term 2.1 1.6 (0.1) (0.3) - - 3.3

Short-term 41.6 17.3 (7.7) (7.5) (7.4) (3.8) 32.6

Profit impact of movements in provisions

Profit (loss) from continuing operations 7.1 (6.5) (3.8)

Profit (loss) from discontinued operations 11.8 (1.2) (3.0)

Income tax expense (0.1) (1.0)

Change in 2018 provisions


Changesin scope

ofconsoli-

dation

Addi-tions

Rever-sals(not

used)

Rever-sals

used

Otherand ex-change

diffe-rences

31 Dec.2018

Restructuring and employee-related risks 9.8 0.9 2.2 (2.0) (3.9) 0.3 7.3

Tax, legal and commercial risks 19.4 0.8 7.0 (3.5) (5.2) (1.1) 17.4

Deferred commissions 0.9 - 0.8 - - - 1.7

Other risks 12.2 0.4 10.4 (2.4) (3.3) - 17.2

Total 42.3 2.1 20.4 (7.9) (12.4) (0.7) 43.7

Long-term 1.1 1.7 0.1 (0.7) (0.1) 0.1 2.1

Short-term 41.2 0.4 20.3 (7.2) (12.3) (0.8) 41.6

Profit (loss) impact of movements in provisions

Profit (loss) from continuing operations 11.1 (2.6) (8.3)

Profit (loss) from discontinued operations 8.8 (3.9) (3.4)

Income tax expense 0.4 (1.4) (0.7)



Provisions for pensions and 17.other post-employment benefit obligations

Description of pension plans17.1.

Post-employment benefits are grantedunder defined contribution plans ordefined benefit plans.

DEFINED CONTRIBUTION 17.1.1.PLANS

A defined contribution plan is a plan underwhich the Group pays fixed contributionsto an external entity that is responsible forthe plan’s administrative and financialmanagement. The employer is thereforefree of any subsequent obligation as theagency is in charge of paying employeesthe amounts to which they are entitled(basic Social Security pension plan,supplementary pension plans).

Special case: Pensions plans in Belgium

The Belgian “Vandenbroucke Law” statesthat employers must guarantee a minimumreturn on employee contributions. AllBelgian defined contribution plans aretherefore treated as defined benefit plans inaccordance with IFRS.

As from 1 January 2016, the Group has beenrequired to guarantee a minimum returnfor contributions paid in. The returndepends on the yield on Belgian 10-yeargovernment bonds but should be between1.75% and 3.25%. There will be no distinctionmade between employer and employeecontributions.

Employers are exposed to a financial risk asa result of this guaranteed minimum returnfor defined contribution plans in Belgium,since they have a legal obligation to payadditional contributions if the plan doesnot have sufficient assets to pay all benefitsrelating to past service costs.

These plans are classified and accountedfor as IAS 19 defined benefit plans.

DEFINED BENEFIT PLANS17.1.2.

Defined benefit plans are characterised bythe employer’s obligation to its employees.Provisions are therefore accrued to meetthis obligation.

The defined benefit obligation is calculatedusing the projected unit credit method,which uses actuarial assumptions asregards salary increases, retirement age,mortality, employee turnover and thediscount rate.

Changes in actuarial assumptions, or thedifference between these assumptions andactual experience, result in actuarial gainsor losses. These are recognised in othercomprehensive income for the period inwhich they occur, in accordance with theGroup’s accounting principles.

For the Group, defined benefitpost-employment plans primarily concernthe benefits described below:

severance pay in France:•

lump-sum benefits calculated▶according to the employee’s years ofservice and his/her averagecompensation over the last 12 monthsprior to his/her departure,

the calculation is based on inputs▶defined by the Human ResourcesDepartment in France in Novembereach year,



the calculated amount is set aside▶under provisions in the statement offinancial position;

termination benefits in Italy:•

rights vested by employees for▶each year of service pro rata to theirgross annual compensation, revisedevery year and paid in advance orupon retirement, voluntary departureor termination,

the calculated amount is set aside▶under provisions in the statement offinancial position.

At Econocom International Italia andAsystel Italia, all rights arising after1 January 2007 have been transferred to anexternal entity and provisions thereforeonly concern rights vested at 31 December2006 for which the Group was still liable at31 December 2019.

Since Italy requires rights to be transferredto a third party or treasury fund as from acertain threshold only, certain rightsrelating to Bizmatica were kept on theGroup’s books.

“Group” insurance in Belgium:•

defined contribution plans, which▶provide a guaranteed return onpayments made by the employer andthe employee, payable as either alump-sum benefit or equivalentannuity, or compensation in the eventof death during employment. As thepayment guaranteed by theinsurance company is uncertain, theGroup presents these plans asdefined benefit plans, even thoughthe amount of such plans in thestatement of financial position issubject to only minimal changes;

company pension plans in Austria: these•are paid on the basis of employees’ yearsof service and also cover the risk of deathand disability. The benefits are also paidover to the surviving spouse in the eventof death of the employee.

The Group has plan assets in France,Belgium and Austria. The expected rate ofreturn on plan assets has been set at thesame level as the rate used to discount theobligation.

The amounts which Econocom expects to pay directly in 2020 in respect of its employercontribution to the bodies in charge of collecting contributions, will represent around€1.1 million.



Actuarial assumptions and experience 17.2.adjustmentsActuarial valuations depend on a certain number of long-term variables. These variables arereviewed every year.

France Other countries(1)

2019 2018 2019 2018

Retirement age63-65years

63-65years

60-65years

63-65years

Salary increase rate and rights vested 2.20% 2.40%1.00%-2.20%

1.00%-2.25%

Inflation rate 1.70% 1.90% 1.70% 1.90%

Discount rate 0.70% 1.60% 0.70% 1.60%

Mortality tableINSEE

2013-2015INSEE

2012-2014- -

Individually, the “Other countries” had an immaterial impact.(1)

The employee turnover rate was determinedbased on statistics for each country andbusiness. The employee turnover rate isapplied depending on the age band of eachemployee and, for certain countries,depending on the employee’s status(managerial-grade/non-managerial-grade).

increase in the provision of approximately€1.9 million. A 0.25 percentage pointincrease in the discount rate would lead toa €1.4 million decrease in the provision.

A decrease of around 0.25 percentagepoints in the discount rate would lead to an

In accordance with IAS 19, the discountrates applied to determine the amount ofthe obligation are based on the yield onlong-term private-sector bonds over a termmatching that of the Group’s obligations.


Present value of obligation (a) 72.2 63.1

Present value of plan assets (b) 27.3 18.5

Impact of discontinued activities and disposals (c) 7.8

Provision for pension obligations (a) – (b) – (c) 37.1 44.6

Long-service awards 0.3 0.5

Provisions for pension and other post-employment benefit obligations 37.4 45.1





Income and expenses recognised in profit or loss17.3.Items of pension cost

in € millions 31 Dec. 2019 31 Dec. 2018restated*

Service cost (3.9) (3.9)

Curtailment/termination 1.7 1.4

Interest expense (0.6) (0.6)

Expected return on plan assets 0.3 0.3

Total costs recognised in profit or loss (2.5) (2.7)

Total costs recognised in other items of comprehensive income (0.9) (2.0)

Following the application of IFRS 5 (see 2.2.5.)*

Service cost is shown within “Personnel costs” in the income statement. Interest expense,corresponding to the cost of discounting the obligation, is included in “Financial expenses”.Curtailments and terminations are mainly included in non-recurring operating profit.

Changes in provisions recorded in the statement 17.4.of financial positionChanges in the 2019 provision


Changesin scope

ofconsoli-

dation

Incomestate-ment

Benefitspaid

directly

Reclas-sifica-

tion ofliabilities

held forsale

Actua-rial

gainsand

losses(1)

31 Dec.2019

France 37.8 (0.3) 2.0 (0.8) (5.9) (2.3) 30.5

Other countries 6.8 - 0.5 (0.9) (1.3) 1.4 6.6

Provisions for pensions 44.6 (0.3) 2.5 (1.6) (7.2) (0.9) 37.1

Long-service awards (France) 0.5 - (0.2) - (0.1) - 0.3

Total 45.1 (0.3) 2.3 (1.6) (7.3) (0.9) 37.4

Cumulative revaluation gains and losses carried in other comprehensive income represented a net negative(1)

amount of €4.3 million in 2019 and €5.0 million in 2018, i.e., a change of €0.7 million between the two periods,resulting primarily from the change in actuarial assumptions.



Change in the 2018 provision


Changesin scope of

consoli-dation

In theincome

state-ment

Benefitspaid

directly

Actuarialgains

andlosses

31 Dec.2018

France 39.0 0.1 1.3 (1.0) (1.7) 37.8

Other countries 6.3 0.6 1.6 (1.5) (0.3) 6.8

Provisions for pensions 45.3 0.7 2.9 (2.5) (2.0) 44.6

Long-service awards (France) 0.4 - 0.1 - - 0.5

Total 45.7 0.7 3.0 (2.5) (2.0) 45.1

Changes in plan assets17.5.Changes in 2019 plan assets

in € millions

31 Dec.2018

Valuation oftermination

ofemployment

Expectedreturn

Benefitspaid by

employer

Benefitspaid by

fund

Curtailment/termination

Actuarialgains

andlosses

31 Dec.2019

France 3.8 - 0.1 - (0.8) - - 3.1

Other countries(1) 14.7 8.7 0.2 1.1 (0.9) 0.2 0.1 24.1

Total 18.5 8.7 0.3 1.1 (1.6) 0.2 0.1 27.3Including €23.6 million at 31 December 2019 relating to Belgian entities.(1)

Change in 2018 plan assets

in € millions

31 Dec.2017

Changes inscope of

consolidation

Expectedreturn

Benefitspaid by

employer

Benefitspaid by

fund

Curtailment/termination

Actuarialgains

andlosses

31 Dec.2018

France 4.7 - 0.1 - (1.0) - - 3.8

Other countries(1) 14.9 - 0.2 0.6 (1.5) 0.2 0.3 14.7

Total 19.6 - 0.3 0.6 (2.5) 0.2 0.3 18.5

Estimated payments under defined benefit plans 17.6.(no discounting) over a ten-year periodTiming of estimated payments to be made to employees under the main defined benefitplans, either by the plan (plan assets) or directly by Econocom if there are no plan assets:

in € millionsDue in

less than1 year

1-2years

2-3years

3-4years

4-10years Total

Estimated payments 1.2 1.7 2.0 2.3 32.6 39.8



Notes to the consolidated 18.statement of cash flowsDefinition of cash flows

Cash flows are presented in the statementof cash flows, which analyses changes incash flows from all activities, includingcontinuing and discontinued operations aswell as activities held for sale.

Cash as presented in the statement of cashflows includes cash and cash equivalents,presented net of bank overdrafts.Year-on-year changes in cash and cashequivalents can be broken down as followsin 2019 and 2018:


Net cash and cash equivalents at 1 January 604.8 232.9

Change in net cash and cash equivalents (29.3) 372.0

Net cash and cash equivalents at 31 December 575.6 604.8

18.1. Comments on the consolidated statement of cash flows from (used in) operating activitiesNet cash used in operating activitiestotalled €125.8 million in 2019 compared to€119.9 million in 2018, reflecting:

cash flow from operating activities•totalling €140.1 million in 2019 versus€105.7 million in 2018;

contracts) for -€7.7 million in 2019 (€39.0million in 2018);

the financing of innovative digital or•non-IT contracts in the TechnologyManagement & Financing business(through the funding entity in Ireland andmore generally through self-funded

other drops in working capital•requirement (down €7.6 million in 2019compared with a drop of 80.2 million in2018); this decline reflects the constantattention paid to the reduction of the cashrequirements of each entity;

income tax paid before tax credits of•€29.6 million.



NON-CASH EXPENSES (INCOME)18.1.1.


Elimination of share of profit (loss) of associates and joint ventures - -

Depreciation/amortisation of property, plant and equipment and intangible assets** 10.1/10.2 57.7 30.0

Net additions to (reversals from) provisions for contingencies and expenses 3.6 1.9

Change in provisions for pensions and other post-employment benefit obligation 1.1 0.6

Impairment of long-term financial assets 1.0 -

Impairment of trade receivables, inventories and other current assets 6.6 4.3

Total provisions, depreciation, amortisation and impairment 70.1 36.9

Change in residual interest in leased assets(1) 3.2 (17.8)

Cost of discounting residual interest in leased assets and gross commitments on residual financial assets (1.5) (1.0)

Losses (gains) on disposals of property, plant and equipment and intangible assets 2.6 0.8

Gains and losses on fair value remeasurement 2.4 - (0.2)

Expenses calculated for share-based payments 0.7 1.1

Impact of sold operations and changes in consolidation methods and other non-cash expenses (income) (25.8) (0.3)

Other non-cash expenses (income) (24.0) 0.3

Non-cash expenses (income) 49.2 19.4

Changes in the Group’s residual interest in leased assets compare the undiscounted value of the residual interest(1)

from year to year, adjusted for currency impacts. The impact for the period of discounting is eliminated in the“Other non-cash expenses (income)” item.

Following the application of IFRS 5 (see 2.2.5.)*

Includes €25.3 million in 2019 for the share of rental payments that is considered an amortisation of rights of use,**

in accordance with IFRS 16.



COST OF NET DEBT18.1.2.

The reconciliation of financial expense booked in the income statement with financialexpense relating to the cost of debt as presented in the statement of cash flows can bepresented as follows:

in € millions

2019consolidated

incomestatement

Discountingand changein fair value

Currencyimpact and

otherCost of net

debt in 2019

Net financial expense – operating activities 4.7 (1.5) (1.0) 2.2

Other financial income and expenses (19.2) 0.6 1.2 (17.3)

Total (14.5) (0.8) 0.2 (15.2)

CHANGE IN WORKING CAPITAL REQUIREMENT18.1.3.

Changes in working capital can be analysed as follows:

in € millions Notes 31 Dec.2018

Changein

workingcapitalin 2019

Reclassif.of assets

/Liabilitiesheld for

sale

Otherchanges(1)

31 Dec.2019

Other long-term receivables, gross 10.4 15.2 1.9 (2.6) (0.9) 13.6

Inventories, gross 12.1 72.0 13.5 (14.5) (1.9) 69.2

Trade receivables, gross 12.2 1,240.9 (114.4) (60.9) (1.3) 1,064.3

Other receivables, gross 12.2 91.2 28.6 (8.4) (8.0) 103.4

Residual interest in leased assets(2) 11.1 163.8 - - 1.1 165.0

Current tax assets 10.2 - (0.1) 8.0 18.1

Other current assets 12.2 66.2 1.5 (5.4) (4.0) 58.4

Trade receivables and other operating assets 1,659.5 (68.9) (91.8) (6.9) 1 492.0

Other non-current liabilities 12.5 (69.9) (1.0) - 28.5 (42.4)

Trade payables 12.3 (854.0) 71.9 23.0 2.2 (756.9)

Other payables 12.3 (250.3) (6.1) 20.7 12.0 (223.7)

Current tax liabilities (14.9) (0.5) 1.0 (3.6) (18.0)

Other current liabilities 12.4 (275.2) (14.6) 13.2 38.2 (238.4)

Gross commitments on residual financial assets(3) 11.2 (98.1) (0.7) - (2.7) (101.5)



in € millions Notes 31 Dec.2018

Changein

workingcapitalin 2019

Reclassif.of assets

/Liabilitiesheld for

sale

Otherchanges(1)

31 Dec.2019

Trade and other operating payables (1,562.4) 49.0 57.8 74.5 (1,381.0)

Other changes in working capital requirement(4) 11.6 4.6 16.2

Total change in working capital requirements

- (15.3) - -

Mainly corresponding to changes in the scope of consolidation and in fair value, and translation adjustments.(1)

Changes in the residual interest in leased assets are shown in cash flows from operating activities.(2)

Corresponding to changes in residual financial assets excluding the currency effect and discounting in the period.(3)

Change in deferred tax assets relates to the additional tax depreciation in Italy which is considered a working(4)

capital requirement item, whereas tax revenue is considered as recurring operating profit.

Breakdown of net cash from (used in) in investing 18.2.activitiesNet cash used in investing activitiestotalled -€27.1 million, primarily reflecting:

to the Group’s IT infrastructure andapplications (see note 10);

cash outflows of €23 million resulting•from investments in property, plant andequipment and intangible assets relating

net cash outflows of €0.7 million linked to•the payments of earnouts and deferreddebt and inflows following the disposal ofRayonnance and Jade.

Breakdown of net cash from (used in) in financing 18.3.activities

Net cash from financing activities•amounted to -€118 million, mainlyreflecting:

cash outflows of €26 million relating to•net treasury share buybacks;

cash outflows of €27.5 million relating to•payments made to shareholders duringthe year (refund of issue premiums);

net cash outflows of €6.9 million•corresponding to the decrease inrefinancing liabilities on lease contractsand liabilities on self-funded contracts;

outflows of €40.9 million in repayments of•financial debts;

net cash inflows of €23.6 million following•the issue of commercial paper;

€26.9 million of outflows relating to IFRS•16 restatements;

interest payments totalling €16 million in•the year (including coupon payments onSchuldschein and Euro PP bonds).



Risk management19.Capital adequacy 19.1.

frameworkThe gearing or net debt/equity ratio cameout at 52.1% at 31 December 2019, comparedto 51.2% at 31 December 2018.

It is calculated by taking financial debt aspresented in Note 14, less cash and totalequity as shown on the statement offinancial position at the reporting date.

The Group seeks a level of gearing thatmaximises value for shareholders whilemaintaining the financial flexibility that isrequired to implement its strategic projects.

Risk management 19.2.policyThe Group’s activities are subject to certainfinancial risks: market risk (includingcurrency risk, interest rate risk and pricerisk), liquidity risk and credit risk.

businesses. Financial market risks (interestrate and currency risk) and liquidity risksare handled by Group Management.

The Group’s overall financial riskmanagement policy focuses on reducingexposure to credit risk and interest rate riskby transferring finance lease receivables torefinancing institutions and by usingfactoring solutions on a non-recourse basisin the Digital Services & Solutions

MARKET RISK19.2.1.

At the end of the year, Group Managementfixes all of the rates to be applied in thefollowing year’s budgeting process.

The Group manages its exposure to interestrate and currency risks by using hedginginstruments such as swaps and foreignexchange forward contracts. Thesederivative financial instruments are usedpurely for hedging and never forspeculative purposes.

Currency risk19.2.1.1.

The Group operates chiefly in the eurozone;however, following the expansion ofoperations in non-eurozone countries inEurope, as well as North and SouthAmerica, the Group may be exposed tocurrency risk on other currencies. The tablebelow summarises the sensitivity of certainconsolidated income statement lines to anincrease or decrease of 10% in exchangerates against the euro, linked to thetranslation of the subsidiaries’ foreigncurrency accounts.



Sensitivity of income statement

in € millions

Contribution to the consolidated financial statements

Sensitivity to a

change of:

EUR GBP USD BRL PLN Other Total +10% -10%

Revenue from continuing operations

2,646.5 65.1 175.1 15.9 14.3 9.7 2,926.6 (25.5) 31.1


109.6 3.4 7.0 2.3 1.2 0.7 124.2 (1.3) 1.6

Profit 41.3 2.6 5.2 1.3 0.2 (2.0) 48.6 (0.7) (0.8)

Since the subsidiaries’ purchases and salesare mainly denominated in the samecurrency, this exposure is limited.Econocom Group does not deem this riskto be material, but has nevertheless signeda number of foreign exchange hedgingagreements to hedge risks on internalflows.

agreements work. Regardless ofmovements in the dollar, the impact onprofit or loss is not material.

The Group also manages finance leaseagreements denominated in US dollars inits Technology Management & Financingbusiness. Currency risk is hedged naturallydue to the specific way in which these

INTEREST RATE RISK19.2.2.

Econocom’s operating income and cashflows are substantially independent ofchanges in interest rates. Sales of leases torefinancing institutions are systematicallybased on fixed rates. Income arising onthese contracts is therefore set at theoutset and only varies if the contract isamended.

The table below presents a breakdown of fixed-rate and floating-rate debt:

in € millions

At 31 December 2019 At 31 December 2018

Outstanding % totaldebt Outstanding % total

debt

Fixed rate(1) 531.8 64% 534.8 62%

Floating rate(2) 296.0 36% 321.7 38%

Gross debt(2) (see note 14.2) 827.8 100% 856.5 100%

Of which the OCEANE convertible bond (issued in March 2018) and all “Schuldschein” notes: one tranche of the(1)

notes (€115 million) bears interest at floating rates; however, an interest rate swap was set up at the outset toconvert this floating rate to a fixed rate.Excluding current bank overdrafts.(2)



At 31 December 2019, some of the Group’sdebt is at floating rates and comprisesshort-term borrowings (credit lines andcommercial paper), and short-termfactoring agreements.

The interest rate sensitivity analysis showsthat a 1% (100 basis point) rise in short-terminterest rates would result in a €2.1 millionimpact on in profit before tax.

PRICE RISK19.2.3.

The Group is exposed to the risk offluctuations in the residual interests ofleased equipment within the scope of itsTechnology Management & Financingbusiness. It deals with this risk bycalculating the future value of equipmentusing the diminishing balance method,thereby guarding against the risk ofobsolescence. This method is described innote 11.1.

The method is regularly compared withactual transactions, and annual statisticsare compiled to validate the suitable andprudent nature of the selected method.

LIQUIDITY RISK19.2.4.

The Financing Department is responsiblefor ensuring that the Group has a constantflow of sufficient funding:

by analysing and updating cash flow•forecasts on a monthly basis for theGroup’s 15 main companies;

by negotiating and maintaining sufficient•outstanding lines of financing;

by optimising the Group’s cash pooling•system in order to offset cash surplusesand internal cash requirements.

The credit lines and commercial paper in place at 31 December 2019 are shown below:

2019 in € millions Total amountavailable

Total amountdrawn down

Unconfirmed credit lines(1) 102.5 -

Confirmed credit lines 151.1 8.9

Sub-total: credit lines 253.6 8.9

Commercial paper 450.0 278.5

Sub-total: commercial paper 450.0 278.5

Total credit lines and commercial paper 703.6 287.5

Repayment schedule not defined.(1)

The credit lines ensure that the Group hasthe liquidity needed to fund its assets,short-term cash requirements anddevelopment at the lowest possible cost.

programme (capped at €450 million) was€278.5 million.

In October 2015, Econocom set up acommercial paper programme on theFrench market. At 31 December 2019, theamount outstanding under this

The characteristics of bond debt are set outin note 14.2.

Based on its current financial forecasts,Econocom Management believes it hassufficient resources to ensure thecontinuity of its activities.



Maturity analysis for financial liabilities (excluding derivative instruments) and otherliabilities (including liabilities under put and call options on noncontrolling interests)

The following maturity analysis for financial liabilities (principal and interest) showsremaining contractual maturities on an undiscounted basis:

2019 in € millions Totalcommitment

Less than1 year 1 to 5 years Beyond

5 years

Lease liabilities 59.2 21.5 37.7 -

Gross commitments on residual financial assets 108.7 21.8 86.9 -

Liabilities relating to contracts refinanced with recourse 94.3 35.6 58.8 -

Bank debt, commercial paper and other 292.0 289.2 2.8 -

Convertible bonds (OCEANE) 222.8 5.6 217.3 -

Non-convertible bonds (Euro PP/Schuldschein) 262.2 50.6 211.6 -

Trade payables 756.9 756.9 - -

Other payables (excluding derivative instruments) 222.8 222.8 - -

Other current (financial) liabilities 35.6 35.6 - -

Non-current non-interest-bearing liabilities 42.4 3.3 39.1 -

Total 2,097.1 1,443.0 654.1 -

2018 in € millions Totalcommitment

Less than1 year 1 to 5 years Beyond

5 years

Finance lease liabilities 6.1 2.2 3.8 -

Gross commitments on residual financial assets 105.1 26.9 78.2 -

Liabilities relating to contracts refinanced with recourse 105.9 40.8 65.0 -

Bank debt, commercial paper and other 287.2 283.0 4.2 -

Convertible bonds (OCEANE) 228.3 5.5 222.8 -

Non-convertible bonds (Euro PP/Schuldschein) 267.4 5.1 262.3 -

Trade payables 854.0 854.0 - -

Other payables (excluding derivative instruments) 249.6 249.6 - -

Other current (financial) liabilities 70.0 70.0 - -

Non-current non interest-bearing liabilities 64.5 2.1 62.4 -

Total 2,238.1 1,539.2 698.9 -



CREDIT AND COUNTERPARTY 19.2.5.RISK

the counterparty risk represent less than10% of outstanding rentals in the TMFbusiness. The Group decided to

The Group has no significant exposure toconcentrate its strategic transactions

credit risk. It has policies in place to ensurebearing credit risk within its subsidiary

that sales of goods and services are madeEconocom Digital Finance Limited to

to clients with an appropriate credit history.ensure a consistent risk management

The Group’s exposure is also limited as itapproach.

does not have any concentration of creditrisk and uses factoring solutions for theDistribution and Services businesses, aswell as non-recourse refinancing with banksubsidiaries and credit insurance in theTechnology Management & Financingbusiness. For its Technology Management& Financing business, the Groupnevertheless has the option of retaining thecredit risk on certain strategic transactions;lease contracts on which Econocom bears

The Group only invests withinvestment-grade counterparties, thuslimiting its credit risk exposure.

Maximum credit risk exposure

As the Group has no credit derivatives orcontinuing significant involvement in thetransferred assets, its maximum exposurein this respect is equal to the carryingamount of its financial assets (see note 13.1).

Aged balance of receivables past due but not impaired

2019 in € millions

Carrying amount

Receivables not past

dueBreakdown by maturity

TotalLess

than 60days

Between60 and

90 daysOver 90

days

Trade receivables – refinancing institutions, gross

98.3 46.9 51.4 31.5 13.4 6.5

Other receivables, gross 966.0 744.0 222.3 78.5 23.3 120.4

Impairment of doubtful receivables (63.9) (12.9) (51.1) (0.1) (0,1) (51,0)

Trade and other receivables, net 1,000,4 778.1 222.5 110.0 36.6 75.9

EQUITY RISK19.2.6.

The Group does not hold any unlisted orlisted shares apart from treasury shares.

As the treasury shares held by EconocomGroup at 31 December 2019 are deductedfrom shareholders’ equity in theconsolidated financial statements as oftheir acquisition, it is not necessary tocompare their carrying amount to theiractual market value.



Off-balance sheet commitments20.Commitments 20.1.

received as a result of acquisitionsVendors warranties in connection withacquisitions carried out in prior years werenon-significant.

20.2. Commitments given in respect of disposalsFor the disposals which took place in 2019the vendor warranties granted by thegroup were not material.

20.3. Bank covenantOnly one covenant exists for the Euro PPprivate placement bond and theSchuldschein notes (private placementunder German law). A breach would notresult in early redemption; rather, it wouldforce the Group to pay a higher interestrate until the ratio is brought back withinthe relevant bounds. It is calculated as of31 December of each year, and correspondsto the ratio of net debt to proforma EBITDA.It may not exceed 3x over twoconsecutive years. At 31 December 2019,this covenant was respected.

20.4. Garantee commitments

in € millions Total guaranteesgiven – 2019

Guarantees given by Econocom to banks for securing credit lines and borrowings(1) 350.0

Guarantees given by Econocom to refinancing institutions to cover certain operational risks, residual financial values, and invoice and payment mandates granted to Econocom(2)

273.7

Guarantees given to clients for the Group’s sales activities and guarantees given to suppliers 121.3

Total guarantees given 745.0

Including €56.5 million recognised in financial liabilities. The guarantees relating to financing lines not yet drawn(1)

at 31 December 2019 totalled €293.5 million and €227.2 million at 31 December 2018.Including €211.0 million refinanced at 31 December 2019, including €90.3 million in the statement of financial(2)

position relating to liabilities under finance leases with recourse. The amount of guarantees given to refinancersand not refinanced at 31 December 2019 was €62.7 million compared with €24.2 million at 31 December 2018.



The Group's off-balance sheet commitments can be analysed as follows by maturity andtype of commitment:

in € millionsLessthan

1 year1-5 years Beyond

5 yearsAt

31 December2019

At31 December

2018

Commitments given 66.8 438.5 239.7 745.0 646.8

Commitments given to banks 32.3 317.7 - 350.0 300.7

Commitments given to refinancers - 34.6 239.1 273.7 254.7

Commitments given to customers and suppliers 34.5 85.1 0.5 120.1 90.3

Other guarantees - 1.1 0.1 1.2 1.1

Commitments received 0.6 1.0 - 1.6 2.1

Guarantees and pledges 0.6 1.0 - 1.6 2.1

Information on the transfer 21.of financial assets

Derecognition of 21.1.financial assets and liabilitiesThe Group derecognises all or part of afinancial asset (or group of similar assets)when the contractual rights to the cashflows on the asset expire or when theGroup has transferred the contractualrights to receive the cash flows of thefinancial asset and substantially all the risksand rewards of owning the asset.

The Group only derecognises all or part of afinancial liability when it is extinguished, i.e.,when the obligation specified in thecontract is discharged, cancelled or expires.

Transfer of cash flows only

When the Group has transferred the cashflows of a financial asset but has neithertransferred nor retained substantially allthe risks and rewards of its ownership andhas not retained control of the financialasset, the Group derecognises it andrecognises separately as assets or liabilitiesany rights and obligations created orretained in the transfer.

Retaining substantially all the risks andrewards of ownership of a divestedfinancial asset

If the Group has retained substantially allthe risks and rewards of ownership of adivested financial asset, it continues torecognise the financial asset in its entiretyin addition to recognising theconsideration received as a securedborrowing.

Retaining control of a financial asset

If the Group has retained control of afinancial asset, it continues to recognise iton the statement of financial position tothe extent of its continuing involvement inthat asset.

If the Group neither transfers nor retainssubstantially all the risks and rewards ofownership and continues to control thedivested asset, it recognises the part it hasretained in the asset and an associatedliability for the amounts it is required topay.



Full derecognition

When a financial asset is derecognised infull, a gain or loss on disposal is recorded inthe income statement for the differencebetween the carrying amount of the assetand the consideration received orreceivable, adjusted where necessary forany gains or losses recognised in othercomprehensive income and accumulatedin equity.

Partial derecognition

When a financial asset is partiallyderecognised, the Group allocates theprevious carrying amount of the financialasset between the part that continues tobe recognised in connection with theGroup’s continuing involvement and thepart that is derecognised, based on therelative fair values of those parts on thedate of the transfer. The differencebetween the carrying amount allocated tothe part derecognised and the sum of theconsideration received for the partderecognised and any cumulative gainor loss allocated to it that had beenrecognised in other comprehensiveincome, is recognised in profit or loss. Acumulative gain or loss carried in othercomprehensive income is allocatedbetween the part that continues to berecognised and the part that isderecognised, based on the relative fairvalues of those parts.

Factoring liabilities

and reduce credit risk. Factoring withcontractual subrogation involves thetransfer of ownership of trade receivablesand all associated rights to the factor. Thismeans transfer of the right to receive cashflows.

Certain subsidiaries of Econocom Groupuse factoring to diversify financing sources

As required under IFRS 9 – Financialinstruments: Recognition andMeasurement, these receivables arederecognised when substantially all therisks and rewards of ownership aretransferred to the factor. Where this is notthe case they are maintained in thestatement of financial position after thetransfer and a financial liability is recordedas an offsetting entry for the cash received.

Information on the 21.2.transfer of assets – Assets not derecognised in fullAssignment of trade receivables

For the purpose of optimising its cashmanagement for its Digital, Services &Solutions businesses, the Group assigns aportion of its trade receivables throughoutthe year to factoring companies. At31 December 2019, the Company had anamount of €299.9 million with factoringcompanies, resulting in non-recoursefinancing of €246.7 million. The unfinancedamount of €49.2 million is recognised inlong-term financial assets and otherreceivables, and corresponds tounassignable receivables (securityguarantees).


Receivables assigned to factoring companies 299.9 285.5

Payables 4.0 8.6

Non-factored receivables 49.2 23.9

Receivables sold with no recourse* 246.7 253.0

Receivables sold do not include the portion of receivables financed with recourse, classified in liabilities.*

The overall factoring cost amounted to €2.5 million in 2019 compared with €3.1 million in2018.



Refinancing with recourse

In certain very limited cases, EconocomGroup retains its exposure to the credit riskon its factored receivables. In this case, theGroup transfers title to the equipmentunder the lease to the refinancinginstitution for the duration of the lease, ascollateral for the transaction.

However, for the purposes of simplification,the Group recognised a financial liabilityequal to the total amount factored withrecourse and recorded a gross asset(representing its “continuing involvement”as defined by IFRS 9) in trade receivablesfor an amount of €90.3 million at31 December 2019 (€97.2 million at31 December 2018).

Information on transfers of assets associated with 21.3.refinancing – Derecognised assets

NATURE OF CONTINUING 21.3.1.INVOLVEMENT

Residual financial value

Outstanding amounts under the Group’slease agreements with customers arerefinanced on a non-recourse basis exceptin very rare cases.

The Group’s active risk management policyis aimed at limiting both credit risk and anyother continuing involvement. Accordingly,the Group derecognises outstandingamounts under leases refinanced on anon-recourse basis.

However, the Group frequently sells, andcommits to repurchase, the leasedequipment at the same time as theoutstandings under leases. These purchaseobligations are classified within “grosscommitments on residual financial assets”and recognised in statement of financialposition liabilities.

Other continuing involvement

The main legal forms of refinancingcontracts for lease outstandings aredescribed below:

outstandings assigned in full: Econocom•considers that it has no other involvementwithin the meaning of IFRS 7;

involvement since it retains a portion ofthe risk associated with the contractualrelationship and ownership of the assets;

outstandings assigned as sales of•receivables: Econocom has continuing

outstandings assigned under finance•leases: Econocom has continuinginvolvement since it retains a portion ofthe risk associated with the contractualrelationship.

Risk from continuing involvement dependsabove all on Econocom’s relationship withits customers, and as such is considered,managed and, where appropriate, coveredby provisions as an operational risk and nota financial risk.

RECOGNITION IN INCOME 21.3.2.STATEMENT

For Econocom Group, the cost oftransferring outstandings is an operatingexpense included in the economic analysisof each transaction, and is included in profit(loss) from continuing operationsaccordingly. In contrast, costs relating tothe factoring of trade receivables are of afinancial nature and are classified withinnet financial expense. Gains and costsrelating to unwinding the discount on theresidual interest in leased assets and togross commitments on residual financialassets are considered as operating costsand are included in “Financial income –operating activities”.



BREAKDOWN OF TRANSFERS 21.3.3.FOR THE YEAR

Refinancing is part of the operating salescycle and its seasonal nature is thus linkedto that of its business and not to thepresentation of the statement of financialposition.

A significant part of this business takesplace in December, which is traditionally animportant month for companies where ICTinvestments and digital investments moregenerally are concerned.

Related-party information22.This note presents material transactions between the Group and its related parties.

Management compensation22.1.The Group’s key management personnelare the Chairman, the Vice-Chairman, theManaging directors and the members ofthe Executive Committee.

on the recommendation of theCompensation Committee. The Board hasgiven its Chairman a mandate todetermine the compensation of the othersenior managers of the Group upon theThe conditions related to therecommendations of the Compensationcompensation of the Chairman, theCommittee.Vice-Chairman and the Managing directors

are determined by the Board of Directors


Short-term benefits (including payroll costs) (4.8) (4.6)

Retirement benefits and other post-employment benefits - -

Other long-term benefits - -

Termination benefits (2.2) (0.2)

Share-based payments (0.2) (1.1)

Attendance fees(1) - .

Total (7.2) (5.9)The table only shows compensation paid to key management personnel and excludes attendance fees paid to(1)

non-executive Directors.

The table above shows the amountsexpensed for the members of the ExecutiveCommittee and the Managing directors.This table does not show fees billed toEconocom Group entities by management,which are disclosed in note 22.2 below.

The compensation policy for Directors andmembers of the Executive Committee isset out in further detail in the Board ofDirectors' Management Report insection 5.7.1.



Related-party 22.2.transactionsTransactions between the parent companyand its subsidiaries, which are relatedparties, are eliminated on consolidationand are not presented in this note.

transactions carried out with the Chairmanof the Board of Directors, its Vice-Chairman,the Managing directors and the ExecutiveDirectors, or with companies controlled bythe Group or over which it exercisessignificant influence. These transactionsexclude the components of compensationpresented above.The related-party transactions outlined

below primarily concern the main

Transactions between related parties are carried out on an arm’s length basis.

in € millionsIncome Expenses Receivables Payables

2019 2018 2019 2018 2019 2018 2019 2018

Econocom International BV (EIBV) 0.3 0.6 (2.4) (2.7) - - 0.1 0.1

SCI Dion-Bouton 0.6 - (2.5) (2.4) 2.7 2.1 - -

SCI Maillot Pergolèse - - (1.3) (1.0) 0.2 0.2 - -

SCI JMB - - (1.1) (1.1) 0.3 0.3 - -

APL - - (0.2) - - - - -

GMPC - - - (0.8) - - - -

Bay Consulting SPRL - - (0.5) (0.4) - - - -

Orionisa consulting - - (1.2) (1.3) - - - -

Métis - - (1.0) - - - 0.6 -

Total 0.9 0.6 10.2 (9.7) 3.2 2.6 0.7 0.1

Relations with companies controlled byJean-Louis Bouchard

SCI Dion-Bouton, of which Jean-LouisBouchard is Managing Partner, owns thebuilding in Puteaux, and it received €2.5million in rent in 2019 (€2.4 million in 2018).A receivable of €0.6 million was bookedfollowing the vacating of the premises on 1October 2019. In addition, the EconocomGroup booked receivables of €2.7 millionrepresenting the deposits paid byEconocom France SAS to SCI Dion-Boutonand the repayments expected from it.

Econocom International BV (EIBV) – ofwhich Jean-Louis Bouchard is a Partner – isa non-listed company that directly holds36.40% of the capital of Econocom GroupSE at 31 December 2019. EconocomInternational BV billed fees of €2.4 millionto Econocom Group SE and its subsidiariesin 2019 for managing and coordinating theGroup. These fees amounted to €2.7 millionin 2018. It was also rebilled an amount of€0.3 million by Econocom Group entities.Debt totalling €0.1 million corresponds totrade payables due from the Spanishentities to SCI EIBV.



Transactions with SCI Maillot Pergolèse,which owns the premises in Clichy and ofwhich Jean-Louis Bouchard is Partner andRobert Bouchard Manager, consist of rentfor 2019 amounting to €1.3 million.Receivables in the amount of €0.2 millioncorrespond to guarantees issued byEconocom SAS.

SCI JMB, which owns the premises inVilleurbanne and of which Jean-LouisBouchard is Managing Partner, billed theGroup a total amount of €1.1 million for rentin both 2019 and 2018. Econocom SAS paid€0.3 million in guarantees to SCI JMB.

Relations with companies controlled byRobert Bouchard

Gestion Management de la Petite Ceinture(GMPC) had invoiced the Group€0.8 million for consulting services in 2018.No invoices were recognised in 2019.

Other relations with related parties

BAY Consulting SPRL – of which MartineBayens is Managing Partner – billed theGroup consulting fees totalling €0.5 millionin 2019.

The Group also recognised liabilities in 2015for commitments to one of the Managingdirectors to purchase non-controllinginterests in Alterway for €0.4 million.

Econocom Group committed to invest€3 million in investment fund Educapital IFCPI, which is managed by a managementcompany (Educapital SAS), of whichMarie-Christine Levet, an independentDirector on the Econocom Group Board ofDirectors, is chair and shareholder.

Orionisa Consulting, which is controlled byJean-Philippe Roesh, invoiced consultingservices in the amount of €1.2 million.



Subsequent events23.As of 1 January 2020, Anne Lange, RafiKouyoumdjian and Jean Mounet steppeddown as directors.

On 10 February 2020, Econocom Group wasinformed an agreement had been enteredinto under the terms of which EconocomInternational BV undertook to purchase the5.4% equity interest (i.e. 13,278,091 shares)held in Econocom Group SE by twocompanies controlled by Walter Butler. Theselling price agreed was €3 per EconocomGroup SE share. The sale is subject to theusual condition precedent that EconocomInternational BV obtains a bank loan for thefull purchase price.

On 28 February 2020, Econocomannounced it had entered exclusivenegotiations with the Chequers Capitalinvestment company with a view todisposing of its subsidiary EconocomBusiness Continuity which is responsiblefor all maintenance activities in France.This planned disposal is part of its strategyto refocus its activities, announced andembarked upon in 2019. The disposal issubject to the approval of the competitionauthorities.

In order to face the COVID-19 pandemicand ensure the continuation of activity, theGroup adopted relevant measures and isgradually adapting these over time. Theconsequences of this pandemic did nothave a significant effect on EconocomGroup's business in January and February2020. Its rapid spread across Europe and inparticular, Italy, Spain and France, since thebeginning of March, has led Econocom toanticipate an ongoing uncertain impact onits first quarter revenue in 2020. Part of theprojected decline may only translate into adeferral to the second quarter if thelock-down measures are not furtherrenewed beyond the end of April. At thisstage, it is still quite difficult to measure theimpact on the full year of 2020. However,regarding the financial position for the yearended 31 December 2019, the Groupbelieves that the consequences of thehealth crisis did not have a significantimpact and do not call into question theassumptions and estimates used for thisclosing.



Assessments made by 24.Management and sources of uncertaintyThe main areas in which judgement wasexercised by Group Management were asfollows:

impairment of goodwill (note 9.3):•each year, the Group reviews the value ofthe goodwill in its consolidated financialstatements. These impairment tests areparticularly sensitive to medium-termfinancial projections and to the discountrates used to estimate the value in use ofCGUs;

measurement of provisions for pensions•(see note 17): an actuary calculates theprovision for retirement benefits using theprojected unit credit method. Thiscalculation is particularly sensitive toassumptions regarding the discount rate,salary increase rate and employeeturnover rate;

valuation of the stock options granted•since November 2002: the actuarialformulae used are sensitive toassumptions concerning employeeturnover, changes in and volatility of theshare price of Econocom Group SE, as wellas the probability of Managementachieving its objectives (see note 15.3.1);

valuation of the Group’s residual interest•in leased assets: this valuation isperformed using the method described innote 11.1 and verified each year usingstatistical methods;

assessments of the probability of•recovering the tax loss carryforwards andtax credits of the Group’s subsidiaries (seenote 7 on tax loss carryforwards);

provisions (note 16): provisions are•recognised to cover probable outflows ofresources to a third party with noequivalent consideration for the Group.They include provisions for litigation of anynature which are estimated on the basisof the most probable, conservativesettlement assumptions. To determinethese assumptions, Group Managementrelies, where necessary, on assessmentsmade by external consultants;

like most digital service companies,•Econocom benefits from a research taxcredit (Crédit d’Impôt Recherche) andcompetitiveness and employment taxcredit (Crédit d’impôt pour lacompétitivité et l’emploi) in France. Thefindings of the completed tax auditsconfirmed the positions adopted by theGroup in its financial statements.

Lastly, the accounting methods used in theevent of acquisitions are described in thenote on business combinations.


07shareholders

Share performance 1.and shareholders 256

Econocom group SE share 1.1.performance 256Name, registered office and legal 1.2.form 258Corporate Purpose (article 3 of the 1.3.Bylaws) 258Share capital1.4. 259Rights attached to shares1.5. 262

Annual General Meeting1.6. 266Provisions that could delay, defer or 1.7.prevent a change in control of the Company 269Notifications of major 1.8.shareholdings 271Econocom’s largest shareholder1.9. 272


07 shareholdersshare performance and shareholders

Share performance 1.and shareholders

Econocom group SE share performance1.1.The data that follows have been adjusted to take account of the two-for-one split ofEconocom group shares on 2 June 2017.

Price (in €) Volume

2017 Highest(in €)

Lowest(in €)

Last(in €)

Price(in €)

Number ofshares traded

Value (in €thousands)

January 7.25 6.78 6.99 7.07 12,715,426 89,993

February 7.20 6.80 7.06 7.03 7,578,192 53,341

March 7.40 6.60 6.94 7.02 10,939,812 76,826

April 7.62 6.77 7.38 7.09 8,476,814 60,954

May 7.82 7.18 7.82 7.44 9,379,917 69,656

June 8.00 7.06 7.32 7.40 7,696,144 57,152

July 7.69 6.40 6.46 7.33 8,992,524 64,336

August 6.60 5.98 6.17 6.30 9,481,797 60,144

September 6.48 6.06 6.46 6.31 8,068,838 50,864

October 6.85 6.30 6.61 6.60 7,039,646 46,506

November 6.69 5.94 5.99 6.29 5,615,011 35,011

December 6.20 5.75 5.96 5.98 5,869,330 35,090

Total 2017 8.00 5.75 5.96 6.82 101,853,451 699,874


07shareholdershare performance and shareholders



Lowest(in €)

Last(in €)

Price(in €)


Value(in €

thousands)

January 7.30 5.92 6.72 6.50 8,023,061 52,141

February 7.07 6.36 6.66 6.68 7,786,606 52,032

March 6.62 5.78 5.95 6.14 12,527,051 76,882

April 6.03 5.14 5.35 5.51 11,874,357 65,486

May 5.49 5.20 5.29 5.35 9,719,694 51,999

June 5.71 4.71 4.72 5.29 8,994,421 47,575

July 4.68 2.52 3.02 2.94 65,405,115 192,218

August 3.18 2.84 3.05 2.97 24,411,283 72,530

September 3.12 2.28 2.80 2.71 26,733,717 72,383

October 2.89 2.35 2.76 2.63 16,259,853 42,768

November 3.25 2.67 3.22 2.94 13,105,122 38,487

December 3.27 2.69 2.91 2.92 8,423,123 24,613

Total 2018 7.30 2.28 2.91 3.70 213,263,403 789,114



Lowest(in €)

Last(in €)

Price(in €)


Value (in €thousands)

January 3.23 2.79 3.09 3.03 6,359,334 19,300

February 3.72 2.98 3.55 3.40 8,183,178 27,805

March 3.80 3.36 3.55 3.59 6,010,681 21,567

April 4.01 3.45 3.62 3.68 3,878,115 14,262

May 3.62 2.94 3.11 3.14 3,863,691 12,116

June 3.40 2.93 3.07 3.11 2,996,948 9,331

July 3.24 2.88 3.01 3.05 3,320,357 10,120

August 3.24 2.68 2.71 2.87 2,878,893 8,258

September 2.95 2.28 2.30 2.55 3,728,108 9,490

October 2.48 2.00 2.34 2.32 6,831,355 15,821

November 2.62 2.30 2.35 2.43 3,205,255 7,782

December 2.44 2.22 2.43 2.28 2,375,624 5,427

Total 2019 4.01 2.00 2.43 3.01 53,631,539 161,281



Name, registered 1.2.office and legal formCompany name: Econocom group SE

Registered office: Place du Champ de Mars5, 1050 Brussels (Tel. +32 32 2 790 81 11).

Legal form, incorporation, publisheddocuments:

Econocom was incorporated as a joint-stockcompany (société anonyme) under Belgianlaw on 2 April 1982, under a deed held byJacques Possoz, notary, and published in theBelgian Official Gazette (Moniteur belge) of22 April 1982 (no. 820–11). It was transformedinto a European company (Societaseuropaea) by decision of the GeneralShareholders’ Meeting of 18 December 2015under a deed of the same date held by TimCarnewal, notary, published in the BelgianOfficial Gazette of 31 December 2015.

Econocom is a European Company (Societaseuropaea) governed by the provisionsof Regulation (EC) No. 2157/2001 of8 October 2001 on the Statute for aEuropean Company (the “SE Regulation”) andDirective No. 2001/86/EC of 8 October 2001supplementing the Statute for a EuropeanCompany with regard to the involvement ofemployees and the provisions of Belgian lawin respect of European Companies, as well as,for all other matters not yet covered or onlypartially covered by the SE Regulation,Belgian law applicable to public limitedcompanies insofar as they are not contrary tospecific provisions applicable to EuropeanCompanies. Econocom is a listed companywithin the meaning of article 1:11 of the newBelgian Companies Code (Code des sociétés).

It is registered with the Brussels register ofcompanies of under number 0422.646.816.

Term: indefinite.

Financial year: 1 January to 31 December.

Corporate Purpose 1.3.(article 3 of the Bylaws)The Company’s purpose is, in all countries:

the design, construction, operational and•administrative management, and financingof computer, digital and technological,information and data processing, andtelecommunication systems and solutions,or such systems and solutions as they relateto the Internet of Things (IoT);

the purchase, sale, leasing and trading of all•types of hardware, software and computer,technological, digital or telecommunicationssolutions, for businesses and individualsalike, and more broadly any accessoryconnected with such solutions, as well asany advice, services and related financialtransactions.

To this end, the Company may acquire,manage, operate and sell patents,trademarks, and technical, industrial andfinancial knowledge.

It may establish branch offices or subsidiariesin all countries.

It may acquire interests in any companieswith similar or complementary activities inany country by means of asset transfers,acquisitions, partial or total mergers,subscriptions to initial capital or capitalincreases, financial investments, disposals,loans or any other means.

It may perform, in all countries, all industrial,commercial, financial, securities and propertytransactions related in whole or in part,directly or indirectly, to one or other branch ofits purpose, or one that is liable to expand itspurpose or facilitate its achievement.

It may provide guarantees or grant real orother personal guarantees in favour ofcompanies or individuals, in the broadestsense.


07shareholdersshare performance and shareholders

It may conduct its activities in its own nameor on behalf of third parties, for its ownaccount or for the account of others.

Share capital1.4.SHARE CAPITAL 1.4.1.

(ARTICLE 5 OF THE BYLAWS)

At 31 December 2019, the Company’s sharecapital stood at €23,512,749.67 and wascomposed of 245,380,430 ordinary shareswith no stated par value, held in registered,or dematerialised form. The capital is fullypaid-up.

CHANGES IN SHARE CAPITAL 1.4.2.BY THE ANNUAL GENERAL MEETING (ARTICLE 6 OF THE BYLAWS)

The share capital may be increased orreduced by a decision of the Annual GeneralMeeting in accordance with the conditionsrequired for amending the Bylaws.

For capital increases approved by the AnnualGeneral Meeting, the price and conditionsfor issuing new shares are set at the samemeeting based on recommendations fromthe Board of Directors.

Existing shareholders have a pre-emptiveright to subscribe for the new shares in cash,in proportion to the number of shares theyhold, within a time limit set at the AnnualGeneral Meeting and in accordance withconditions determined by the Board ofDirectors.

Shares with no stated par value below thecarrying amount of the par value of existingshares may only be issued in compliancewith legal requirements.

designated persons who are not employeesof the Company or its subsidiaries, all inaccordance with legal provisions.

Pre-emptive rights may, however, in theCompany’s best interests, be limited orcancelled by decision of the Annual GeneralMeeting ruling in accordance with theconditions required for amending the Bylawsor by the Board of Directors, within theauthorised capital, in favour of one or more

The Board of Directors may signagreements, containing the clauses andconditions it deems appropriate, with anythird party in order to ensure that all or partof the shares to be issued are subscribed.

The share capital may be redeemed withoutbeing reduced by repaying a portion ofthe distributable profits to securitiesrepresenting this share capital, in accordancewith the law.

CHANGES IN CAPITAL1.4.3.

At 31 December 2019, the Company’s sharecapital stood at €23,512,749.67 and wascomposed of 245,380,430 ordinary shareswith no stated par value, held in registered,or dematerialised form. The capital is fullypaid-up.

At 31 December 2019, authorised unissuedcapital (excluding additional paid-in capital)stood at €19,052,787.28.

The changes in share capital over the lastthree financial years are described below.

The following changes to the sharecapital occurred in 2017:

following the issue in 2014 of ORNANE•bonds convertible into cash and/or newshares and/or exchangeable for existingshares for a total of €175 million, Econocomgroup bought back 39.12% of the bondsissued, while the remaining 60.88% wasconverted in 2017, resulting in the issueof 10,050,928 Econocom group sharesthrough seven capital increases conductedon 17 February 2017, 3 March 2017,16 March 2017, 21 March 2017, 24 March 2017,31 March 2017 and 6 April 2017 (see detailsbelow) respectively, at the end ofwhich Econocom group share capitalrepresented €23,489,757.67, equivalent to122,570,215 shares;



following a decision by the Extraordinary•General Meeting on 16 May 2017, Econocomgroup proceeded with a two-for-one sharesplit, bringing its number of shares to245,140,430 shares with a share capital of€23,489,757.67.

No changes were made to the sharecapital in 2018.

The following changes to the share capitaloccurred in 2019:

in connection with the exercise of•subscription options by a beneficiary of the2014 Stock Option Plan, on 21 June 2019Econocom issued 240,000 new shares afterwhich the share capital of Econocom groupstood at €23,512,749.67, represented by245,380,430 shares.

The number of Econocom group shares andvoting rights (denominator) both stood at245,380,430 at 31 December 2019.

Changes in the Company’s share capital and number of shares since 1 January 2008 aresummarised in the table below:

Transaction date

Typeof issue

Change inthe

numberof shares

Change incapital (in

€)

Issuepremiums

(in €)

Totalamount of

thetransaction

(in €)

Numberof shares

Paid-incapital

(in €)

1 Jan. 2010 24,800,000 16,180,922.08

28 Oct. 2010

Capitalincrease as

payment foran acquisition

1,372,897 895,755.62 14,206,111.38 15,101,867/00 26,172,897 17,076,677.70

14 Sept. 2012

Cancellationof treasury

shares(2,000,000) - - - 24,172,897 17,076,677.70

14 Sept. 2012

Four-for-oneshare split 72,518,691 - - - 96,691,588 17,076,677.70

12 Sept. 2013

Capitalincrease as

payment foran acquisition

9,527,460 1,682,642.38 50,734,212.37 52,416,854.75 106,219,048 18,759,320.08

18 Nov. 2013

Capitalincrease as

payment for atakeover bid

6,313,158 1,114,965.29 36,763,982.71 37,878,948.00 112,532,206 19,874,285.37

31 Dec. 2013Cancellation

of treasuryshares

(6,014,892) - - - 106,517,314 19,874,285.37

24 Jan. 2014

Capital increasethrough

convertiblebonds

(OCEANE)

20,000 3,732.00 101,268.00 105,000.00 106,537,314 19,878,017.37

25 Feb. 2014


convertiblebonds

(OCEANE)

266,028 49,640.82 1,347,006.18 1,396,647.00 106,803,342 19,927,658.19



Transaction date

Typeof issue

Change inthe

number ofshares

Change incapital (in

€)

Issuepremiums

(in €)

Totalamount

of thetransaction

(in €)

Numberof shares

Paid-incapital

(in €)

26 Mar. 2014


convertiblebonds

(OCEANE)

210,592 39,296.47 1,066,311.53 1,105,608.00 107,013,934 19,966,954.66

28 May 2014


convertiblebonds (OCEANE)

708,428 132,192.66 3,587,054.34 3,719,247.00 107,722,362 20,099,147.32

18 June 2014


convertiblebonds

(OCEANE)

7,850,228 1,464,852.54 39,748,844.46 41,213,697.00 115,572,590 21,563,999.86


of treasuryshares

(3,053,303) - - - 112,519,287 21,563,999.86

17 Feb. 2017


convertiblebonds

(ORNANE)

400,000 76,640.00 4,299,240.00 4,375,880.00 112,919,287 21,640,639.86

Transaction date

Type ofissue

Changein the

numberof shares

Change incapital

(in €)

Issuepremiums

(in €)

Totalamount

of thetransaction

(in €)

Numberof shares

Paid-incapital

(in €)

26 Mar. 2014


convertiblebonds

(OCEANE)

210,592 39,296.47 1,066,311.53 1,105,608.00 107,013,934 19,966,954.66

28 May 2014


convertiblebonds

(OCEANE)

708,428 132,192.66 3,587,054.34 3,719,247.00 107,722,362 20,099,147.32

18 June 2014


convertiblebonds

(OCEANE)

7,850,228 1,464,852.54 39,748,844.46 41,213,697.00 115,572,590 21,563,999.86


of treasuryshares

(3,053,303) - - - 112,519,287 21,563,999.86

31 Mar. 2017


convertiblebonds

(ORNANE)

1,961,518 375,826.85 21,106,537.80 21,482,364.65 118,680,917 22,744,568.17

6 Apr. 2017


convertiblebonds

(ORNANE)

3,889,298 189.50 41,855,117.90 42,600,307.40 122,570,215 23,489,757.66

2 June 2017

Two-for-oneshare split 122,570,215 - - - 245,140,430 23,489,757.66

21 June2019

Capital increaseby the exerciseof subscription

option

240,000 22,992 639,408 662,400 245,380,430 23,512,749.67



The Extraordinary General Meeting of21 May 2019 renewed for five years from thedecision of the Annual General Meeting theauthorisation granted to the Board ofDirectors to buy back treasury shares in theproportion of up to 20% of share capital, inaccordance with article 7:215 of the newBelgian Companies Code. The minimumpurchase price was set at €2 per share andthe maximum price at €10 per share. Theseauthorisations apply to the acquisition ofCompany shares by one or more of its directsubsidiaries, pursuant to the legal provisionson the acquisition by subsidiaries of shares intheir parent company.

On 19 May 2015, the Extraordinary GeneralMeeting granted to the Board of Directors,for a five-year period as from the publicationof the revised Bylaws, i.e. 9 June 2015, theauthorisation granted to the Board ofDirectors to increase the share capital, inaccordance with articles 7:198 and 7:199 ofthe new Belgian Companies Code, on one orseveral occasions, under conditions it deemsfit, in the maximum amount of€21,563,999.86.

At 31 December 2019, Econocom group held23,458,144 treasury shares representing9.56% of the total number of sharesoutstanding.

Rights attached 1.5.to shares

PARTICIPATION IN ANNUAL 1.5.1.GENERAL MEETINGS AND VOTING RIGHTS

Participation in Annual 1.5.1.1.General Meetings

Right to participate in Annual 1.5.1.1.1.General Meetings

“Annual General Meetings” section of thischapter.

All shareholders are entitled to attendEconocom group’s Annual GeneralMeetings, regardless of the number ofshares they hold, provided that they meetthe admission requirements set out in the

Holders of bonds, subscription rights andcertificates issued in connection with theCompany may attend the Annual GeneralMeeting in a non-voting capacity only,provided that they meet the admissionrequirements applicable to shareholders.

Right to call Annual General 1.5.1.1.2.Meetings

Shareholders who, alone or jointly, hold atleast 10% of Econocom’s share capital areentitled to ask the Board of Directors orStatutory Auditor to call an Annual GeneralMeeting.

Right to add matters to the 1.5.1.1.3.agenda and to table draft resolutions

Shareholders who, alone or jointly, hold atleast 3% of Econocom group’s share capitalmay ask for items to be added to theagenda of Annual General Meetings and fileresolution proposals concerning agendaitems.

This right does not apply to Meetings calledfollowing a first Meeting that could not validlymake decisions due to a failure to meetquorum requirements.

Shareholders wishing to exercise this rightmust:

prove that they actually hold at least 3%(i)of the Econocom group’s share capital onthe date of filing of their request; and

ensure that their shares representing at(ii)least 3% of the share capital are dulyregistered at the record date.

Ownership is established either by acertificate stating that the correspondingshares are recorded in the Company’s shareregister or by a certificate issued by anauthorised account holder or clearinginstitution certifying that the correspondingnumber of shares is registered in theaccount held by the account holder orclearing agent.



Shareholders may send their requests to theCompany by post or email. Whereappropriate, these requests must alsoinclude the items to be added to the agendatogether with the related resolutionproposals and/or the text of the newlyproposed resolutions concerning itemsalready on the agenda. Requests must alsoindicate the postal or email address to whichEconocom should send confirmation ofreceipt. Requests must reach the Companyno later than the 22nd day preceding the dateof the relevant Annual General Meeting.

Econocom will confirm receipt of anyrequests within 48 hours, and will publisha revised agenda no later than 15 daysbefore the Annual General Meeting. Proxyforms and postal voting forms are alsopublished on the Company’s website(www.econocom.com). However, all proxiesand postal voting forms previously submittedto Econocom remain valid for the agendaitems they cover. The proxy holder maydeviate from the voting instructions given bythe shareholder for items on the agenda forwhich alternative resolution proposals havebeen made if the execution of theseinstructions is liable to compromise theinterests of the shareholder he/sherepresents. The proxy holder must in anyevent inform the shareholder of any suchvotes. The proxy must also indicate whetherthe proxy holder is entitled to vote on newitems added to the agenda by shareholdersor whether he/she should abstain.

Right to ask questions1.5.1.1.4.

After the Notice of Meeting has beenpublished, all shareholders are entitled toput questions to Econocom’s Directors orStatutory Auditor concerning their reports.After the Notice of Meeting has beenpublished, all shareholders are also entitledto put questions to Econocom’s Directorsregarding items on the agenda of theAnnual General Meeting. The Directors andStatutory Auditor are required to answerthese questions, provided they do not harmthe Company’s commercial interests or anyconfidentiality undertakings made by theCompany, its Directors or its StatutoryAuditor. Questions relating to the samesubject may be grouped and answeredtogether.

Questions may be submitted before theGeneral Meeting (by post or by electronicmeans, to the address shown in the Noticeof Meeting) or during the Meeting (verbally).Questions submitted by post or byelectronic means must reach Econocomgroup no later than the sixth calendar daybefore the Meeting. They will only beanswered if the shareholder meets theadmission requirements for the relevantGeneral Meeting.

Other rights to information1.5.1.1.5.

All Econocom group shareholders havespecific rights to information under the newBelgian Companies Code.

Most rights to information concern AnnualGeneral Meetings. They include, amongother things, the right to consult or to obtaina copy at no cost of:

the text of the meeting notices and, if(i)available, of the amended agenda

the total number of shares and voting(ii)rights,



the documents to be presented to the(iii)Annual General Meeting (annual financialstatements, reports and other documentsdescribed in article 7:148 of the new BelgianCompanies Code),

for every subject to addressed on the(iv)agenda, any decision proposed or, whenthe subject does not require the adoptionof a decision, a comment by the Board ofDirectors,

if available, any proposed decision(v)introduced by shareholders, as soon aspossible after receipt by the Company and

proxy forms and forms for voting by(vi)mail. These documents/items may beconsulted on Econocom’s website(www.econocom.com) and during normaloffice hours on working days at Econocomgroup’s registered office located at Placedu Champ de Mars 5, 1050 Brussels, fromthe date of publication of the Notice ofMeeting. Holders of registered shares willreceive a copy of these documentstogether with the Notice of Meeting.

Right to vote at General 1.5.1.2.Meetings

Principle1.5.1.2.1.

Each share entitles its holder to one vote,subject to any restrictions provided by law.

As a general rule, the Annual GeneralMeeting alone is responsible for:

approving the annual statutory financial•statements (no such approval is requiredfor the consolidated financial statementsprepared in accordance with IFRS);

appointing and removing Directors and•the Statutory Auditor;

granting discharge to the Directors and•Statutory Auditor;

setting the amount of compensation for•the Directors and Statutory Auditor for theperformance of their duties;

distributing profits;•

filing claims against Directors;•

authorising certain actions by the Board•of Directors;

approving the compensation report;•

authorising the acquisition of treasury•shares;

taking decisions that involve the liquidation,•merger or restructuring of the Company;and

approving any amendments to the Bylaws.•

Shareholders’ meetings cannot vote onitems that are not on the agenda.

Quorum and voting requirements1.5.1.2.2.

Except as provided by law, decisions aretaken by a majority vote regardless of thenumber of shares represented at theMeeting.

Annual General Meetings can only validlydeliberate and decide to amend the Bylawsif those attending the meeting represent atleast one-half of the share capital. To beadopted, resolutions must be approved by amajority of three-quarters of votes cast.

If the amendments to the Bylaws concernthe Company’s corporate purpose, theAnnual General Meeting can only validlydeliberate and decide on said amendmentsif those in attendance represent one-half ofthe share capital and one-half of any profitshares if any. To be adopted, amendmentsmust be approved by a majority of at leastfour-fifths of votes cast. The quorum andvoting requirements also apply when theAnnual General Meeting votes to authorisethe acquisition or disposal of treasury shares,or to authorise such an acquisition withoutthe authorisation of the Annual GeneralMeeting to protect the Company fromserious and imminent harm.



An attendance list indicating the names ofshareholders and the number of sharesregistered for voting purposes is signed byeach shareholder or by their proxy prior toentering the meeting.

Proxy voting15.1.2.3.

All shareholders can choose to berepresented at a Annual General Meetingby a proxy, who may or may not be ashareholder of the Company, in accordancewith articles 7:142 to 7:145 of the newBelgian Companies Code.

The Board of Directors may decide on theform of proxy. Proxies must reach theCompany no later than the sixth daypreceding the date of the Meeting. All proxyvoting forms that reach the Companybefore the revised agenda is published,pursuant to article 7:130 of the new BelgianCompanies Code, remain valid for theagenda items covered.

Distance voting1.5.1.2.4.

Shareholders who satisfy the attendancerequirements specified below may vote atall Annual General Meetings either by postor, where permitted in the Notice ofMeeting, by electronic means. Shares will betaken into consideration for the purposes ofvoting and quorum requirements only if theform provided by the Company has beenduly completed and reaches Econocom atthe latest on the sixth day before the date ofthe Annual General Meeting. If the Notice ofMeeting allows shareholders to opt fordistance voting through electronic means, itmust provide a description of the meansused by the Company to identifyshareholders that choose to do so.

DISTRIBUTION OF PROFITS1.5.2.

All shares carry the same rights toparticipate in Econocom’s profits.

The Company’s profit for the year iscalculated in accordance with applicablelegal regulations. A total of 5% of profits isallocated to the legal reserve. This allocationis no longer required when the legal reserveequals 10% of the share capital.

Acting on a recommendation of the Boardof Directors, the Annual General Meetingindependently determines how the residualprofit balance will be used and allocated bysimple majority vote of members present,within the limits set by articles 7:212 and7:214 of the new Belgian Companies Code.No profits are distributed when, at the endof the last reporting period, net assets asshown in the annual financial statementstotal less than paid-up capital or would totalless than paid-up capital if profits weredistributed or if net assets exceed called-upcapital plus any reserves not available fordistribution pursuant to the law or to theCompany’s Bylaws.

In accordance with the new BelgianCompanies Code, the Board of Directorsmay distribute an interim dividenddeducted from profit for the year. The Boardsets the amount of any such interimdividend and the dividend payment date.

LIQUIDATION1.5.3.

In the event that Econocom is dissolved forany reason and at any time, the liquidationprocess will be managed by one or moreliquidators appointed by the GeneralMeeting, or, if no such liquidators areappointed, by the Board of Directors in officeat that time, acting as a liquidationcommittee.



For this purpose they will have the broadestpowers conferred by articles 2:87 et seq. ofthe new Belgian Companies Code. TheAnnual General Meeting determines the feespayable to the liquidators. The liquidators canonly assume their duties after theirappointment by the Annual General Meetinghas been approved by the Commercial Courtpursuant to articles 2:83 et seq of the new ofBelgian Companies Code.

Once all liabilities, expenses and liquidationfees have been settled, the net assets will beused first to refund the outstanding paid-upshare capital in cash or in securities.

If the shares are not all paid up in equalproportions, before making any allocations,the liquidators ensure that all shares are ona wholly equal footing, either by additionalcalls for funds charged against sharesnot fully paid up or by prior cashreimbursements for shares paid up in excessof the requisite amount.

The remaining balance is allocated equallyamong all shares.

PRE-EMPTIVE RIGHTS IN 1.5.4.THE EVENT OF A CAPITAL INCREASE

In the event of a capital increase in cashinvolving the issuance of new shares, or if theCompany were to issue convertible bonds orstock warrants exercisable in cash, existingshareholders have, in principle, a pre-emptiveright to subscribe for the new shares,convertible bonds or stock warrants inproportion to the percentage of share capitalthey already own at the issuance date.

Directors. Any such decision is subject to thesame quorum and voting requirements as adecision to increase the Company’s sharecapital. Shareholders may also allow theBoard of Directors to limit or cancel saidpre-emptive rights in the event of a capitalincrease within the authorised capital limits.

The Company’s Annual General Meetingmay, however, limit or cancel suchpre-emptive rights under specific conditionsupon presentation of a report of the Board of

CHANGES IN RIGHTS 1.5.5.ATTACHED TO SHARES

Rights attached to shares issued byEconocom group may be modified by theExtraordinary General Meeting, voting inaccordance with the conditions required foramending the Bylaws. Any changesapproved apply to all shareholders.

Annual General 1.6.MeetingOrdinary General Meetings

The Ordinary General Meeting is held everyyear on the third Tuesday in May, at 11.00amor on the first working day following thisdate if the Tuesday is a holiday. At OrdinaryGeneral Meetings, the Board of Directorssubmits to shareholders the annual statutoryfinancial statements prepared in accordancewith applicable accounting standards, theannual consolidated financial statementsprepared in accordance with IFRS, and thereports of the Board of Directors andStatutory Auditor on the statutory andconsolidated financial statements. TheMeeting decides whether to approve thestatutory financial statements, theappropriation of income, the discharge ofDirectors and the Statutory Auditor and,where applicable, the appointment, removalor re-election of the Statutory Auditor and/orcertain Directors.



Extraordinary General Meetings and Special General Meetings

A Special General Meeting, or, whereappropriate, an Extraordinary GeneralMeeting, may be called by the Board ofDirectors or by the Statutory Auditor asoften as is required in the Company’sinterest. Any such Meeting must be called atthe request of the Chairman of the Board ofDirectors, a Chief Executive Officer(Administrateur Délégué), a StatutoryAuditor (Commissaire), or one or moreshareholders representing at leastone-tenth of the Company’s share capital(article 27 of the Bylaws).

Content of General Meeting convening notices

Annual General Meeting notices mustcontain at least the following information:

the date, time and place of the Annual•General Meeting;

the agenda, indicating the items to be•discussed as well as resolution proposals;

a clear and accurate description of the•formalities to be completed byshareholders in order to attend the AnnualGeneral Meeting and exercise their votingrights, including the deadline by whichshareholders should indicate their intentionto attend the Meeting:

the right of shareholders to add items▶to the agenda, file resolution proposals,and ask questions, as well as the periodin which these rights may be exercisedand the email address to whichshareholders should send theirrequests. Where applicable, the Noticeof Meeting also indicates the deadlinefor publishing the revised agenda. TheNotice may contain only the details ofthese periods and the email address tobe used, provided that more detailedinformation on shareholder rights isposted on the Company’s website,

the procedure to follow in order to vote▶by proxy, and in particular the proxyvoting form, the conditions in whichthe Company will accept notificationsof the appointment of proxies sent byelectronic means, along with thetimeframe within which the proxyvoting rights may be exercised,

where appropriate, the procedure and▶timeframe set by or pursuant to theBylaws allowing shareholders toparticipate in the Annual GeneralMeeting remotely and opt for distancevoting prior to the Meeting (articles 28and 34 of the Bylaws);

the record date, along with a statement•indicating that only people who areshareholders at that date are entitled toattend and vote at the Annual GeneralMeeting;

the address where shareholders can•obtain, for example, the full text of thedocuments and resolution proposalsdescribed, along with the procedure tofollow in order to obtain such documents;

the exact website address on which the•information mentioned below will beavailable.

Availability of documents on Econocom’s website

As from the date of publication of theAnnual General Meeting convening noticeand up to the date of the Annual GeneralMeeting, the following information is postedfor shareholders on the Company’s website(www.econocom.com):

the Notice of Meeting, along with the•revised agenda reflecting itemssubsequently added thereto and therelated resolution proposals whereapplicable, and/or the resolution proposalsformulated within the timeframe given;



the total number of shares and voting•rights at the date of the Notice of Meeting,including separate totals for each class ofshares, when the Company’s share capitalis divided into two or more share classes;

the documents to be submitted to the•Annual General Meeting;

for each item placed on the Annual General•Meeting agenda, a resolution proposal or,when the matter to be discussed does notrequire any resolution to be adopted, theBoard of Directors’ comments thereon. Theresolution proposals formulated byshareholders pursuant to article 7:130 of thenew Belgian Companies Code are postedonline as early as practicably possible afterthey have reached the Company;

the proxy voting form and, where•applicable, the postal voting form, unlessthese forms are sent directly to eachshareholder.

When the forms mentioned above cannotbe posted online due to technical reasons,the Company must explain on its websitehow to obtain a hard copy of them. In thiscase, Econocom is required to send theforms promptly and free of charge to thepostal or email address indicated by anyshareholder that so requests them.

The information mentioned in this sectionwill be available on Econocom’s website(www.econocom.com) for five years as fromthe date of the Annual General Meeting towhich they relate.

Formalities and notice periods

Notification of all Annual General Meetingsmust be made by announcements placedat least 30 days before said Meeting in:

the Belgian Official Gazette;•

a newspaper with national circulation,•unless the notice concerns an OrdinaryGeneral Meeting held in the place and atthe time and date indicated in the Bylaws,and whose agenda is confined to thereview of annual financial statements, theannual report, the Statutory Auditor’sreport and the vote to grant discharge toDirectors and the Statutory Auditor;

any media as may reasonably be relied on•to efficiently disseminate information tothe public throughout the EuropeanEconomic Area and which is readilyaccessible in a non-discriminatory manner.

Holders of registered shares as mentioned inthe new Belgian Companies Code, alongwith Company Directors and the StatutoryAuditor must be notified of the AnnualGeneral Meetings 30 days before they aredue to take place. This notification is sent byordinary letter unless the recipients haveindividually and expressly agreed in writingto receive notification by another means,although no proof of compliance with thisformality is required. Notices of Meetings arealso available on Econocom’s website(www.econocom.com).



If another Meeting has to be called becausea first meeting did not meet the quorum,and provided that the date of any secondMeeting was indicated in the paragraphabove in the first Notice of Meeting and thatno items have since been added to theagenda, the 30-day period specified above isreduced to at least 17 days before theMeeting.

Formalities to be completed in order to attend Annual General Meetings

Shareholders may only attend and vote atAnnual General Meetings if their shares areregistered in their name at the record date,i.e., by midnight (CET) on the fourteenthday preceding the Meeting, either in theCompany’s share register or in the books ofan authorised account holder or clearinginstitution, regardless of the number ofshares held by the shareholder at the dateof the Annual General Meeting.

The shareholders shall inform the Company(or the person designated for this purpose)of their intention to attend the AnnualGeneral Meeting no later than the sixth daypreceding the date of said Meeting, inaccordance with the formalities provided inthe Notice of Meeting, and provided thatshareholders present the share certificatedelivered by the authorised account holderor clearing institution.

Holders of bonds, subscription rights andcertificates issued in connection with theCompany may attend the Annual GeneralMeeting in a non-voting capacity only,provided that they meet the admissionrequirements applicable to shareholders.

Provisions that 1.7.could delay, defer or prevent a change in control of the Company

GENERAL INFORMATION1.7.1.

Laws relating to takeover and squeeze-outbids and their implementing orders, as wellas the new Belgian Companies Code andother applicable laws, contain variousprovisions (such as the requirement todisclose major shareholdings – see section 8of this chapter – and competition provisions)that may be applicable to the Company, andwhich place certain restrictions on hostiletakeover bids or other changes of control.These provisions could discourage potentialtakeover bids that other shareholders mayconsider to be in their interests and/orprevent shareholders from selling theirshares at a premium.

In certain conditions, the Board of Directorsmay defer or prevent the issuance of sharesthat could have a dilutive impact onexisting shareholdings.

AUTHORISED CAPITAL 1.7.2.(ARTICLE 7 OF THE BYLAWS)

Pursuant to a decision of Econocom’sExtraordinary General Meeting of 19 May2015, the Board of Directors was grantedauthorisation to increase the share capital,on one or more occasions, under conditionsit deems fit, by an amount of up to€21,563,999.86. At 31 December 2019,authorised unissued share capital stood at€19,052,787.28 (excluding additional paid-incapital).



The Board of Directors may use thisauthorisation to issue shares with or withoutvoting rights, convertible bonds, equitynotes, subscription rights payable in cash orin kind, and other share equivalents orequity instruments issued by the Company.

Any capital increase effected under thisauthorisation may be carried out:

either by means of contributions in cash or•in kind, including any restricted issuepremium, whose amount is fixed by theBoard of Directors, or by creating newshares carrying rights that will bedetermined by the Board;

or by converting reserves – including•restricted reserves – or the issue premiuminto capital, with or without creating newshares.

This authorisation is granted to the Boardof Directors for a period of five years fromthe date of publication of the decision ofthe Extraordinary General Meeting of19 May 2015 in the annexes of the BelgianOfficial Gazette, i.e., 9 June 2015. It may berenewed on one or more occasions, inaccordance with applicable provisions.

In the event that a capital increase is carriedout within the authorised capital, the Boardof Directors will allocate any issue premiumto a restricted account. This account willform part of shareholders’ equity in thesame way as the share capital, and,provided it is converted into capital by theBoard of Directors, may only be reduced orcancelled by the Annual General Meetingunder the conditions required byarticle 7:208 of the new Belgian CompaniesCode.

for one or more specific parties other thanemployees of the Company or of itssubsidiaries, except as provided inarticle 7:201 of said new Companies Code.

The Board of Directors may limit or cancelpre-emptive subscription rights of existingshareholders in accordance with theconditions set forth in articles 7:190 et seq. ofthe new Belgian Companies Code if it is inthe Company’s interests. It may even do so

The Board of Directors may decide, with theright of substitution, to amend the Bylaws toreflect the Company’s new capital andshares each time the share capital isincreased within the limit of the authorisedcapital.

ACQUISITION AND DISPOSAL 1.7.3.OF TREASURY SHARES (ARTICLE 12 OF THE BYLAWS)

The Company may only acquire its ownshares or (if applicable) profit shares bymeans of a purchase or exchange, directlyor by a person or entity acting in their ownname but on the Company’s behalffollowing a decision of an Annual GeneralMeeting voting pursuant to the quorumand majority requirements set forth inarticle 7:154 of the new Belgian CompaniesCode, which sets the maximum number ofshares or profit shares that can be acquired,the period for which the authorisation isgranted, within the limit provided inarticle 7:215 of the new Belgian CompaniesCode, and the minimum and maximumconsideration.

Such an authorisation was given to theBoard of Directors by the ExtraordinaryGeneral Meeting of 21 May 2019, for a periodof five years from the date of the AnnualGeneral Meeting, for up to 20% of the sharecapital, as provided in article 7:215 of the newBelgian Companies Code. The minimumpurchase price was set at €2 per share andthe maximum purchase price at €10 pershare. These authorisations apply toacquisitions of Company shares by its directsubsidiaries, pursuant to the legal provisionson the acquisition by subsidiaries of sharesof the parent company.


07shareholdershare performance and shareholders

The Annual General Meeting may alsoauthorise the Board of Directors to acquirethe Company’s shares or profit shares, inaccordance with applicable laws andregulations, by means of purchase orexchange, to protect the Company fromserious and imminent harm.

This authorisation may be renewed, on oneor more occasions, in accordance withapplicable laws and regulations.

The Board of Directors may otherwisedispose of shares of the new Company in theconditions provided by the new BelgianCompanies Code, as well as to spare theCompany serious and imminent harm,provided, in such cases, that the securitiesare sold on the market or as a public offeringmade on the same conditions to allshareholders.

Notifications 1.8.of major shareholdingsDirective 2004/109/EC of the EuropeanParliament and of the Council of15 December 2004 on the harmonisation oftransparency requirements in relation toinformation about issuers whose securitiesare admitted to trading on a regulatedmarket, amending Directive 2001/34/EC, wastransposed into Belgian law by the Act of2 May 2007 on the publication of majorshareholdings in issuers whose shares areadmitted to trading on a regulated market(“Transparency Act”) and by the Royal Decreeof 14 February 2008 on the publication ofmajor shareholdings (“Royal Decree onTransparency”). This legislation came intoforce on 1 September 2008.

(Belgian Financial Services and MarketsAuthority) of the number and percentage ofvoting rights held subsequent to thisacquisition when the voting rights attachedto securities carrying voting rights reach aproportion of 5% or more of total existingvoting rights. Shareholders must also notifythe Company in the event that they directlyor indirectly acquire securities carryingvoting rights when, as a result of theiracquisition, the number of voting rightsreaches or exceeds 10%, 15%, 20%, and everyfive-percentage point threshold thereafter, oftotal existing voting rights. Notification is alsorequired in the event that shareholdersdirectly or indirectly sell securities carryingvoting rights when, as a result of this sale, thevoting rights fall below one of the thresholdsstated above.

Pursuant to these provisions, any natural orlegal person who acquires, directly orindirectly, securities carrying voting rights ofthe Company must notify it and the FSMA

In accordance with article 6 of theTransparency Act, the disclosurerequirements mentioned above applywhenever the number of voting rights risesabove or falls below the specified thresholdsas a result of, among others:

the acquisition or sale of securities1.carrying voting rights, regardless of how thesecurities were acquired or sold, for example,by means of a purchase, sale, exchange,contribution, merger, spin-off or succession;

unintentionally crossing the specified2.thresholds (due to an event altering theallocation of voting rights); or

the conclusion, modification or3.termination of an agreement to act inconcert.

The FSMA and the Company must beinformed of any such event as soon aspossible, and at the latest within fourworking days of the date on which the eventtook place.



The Company is required to publish all of theinformation contained in such notificationsno later than three business days afterreceipt. It must also disclose its ownershipstructure in the notes to its annual financialstatements, based on the notificationsreceived.

bonds convertible into securities carryingvoting rights and rights to subscribe forsecurities not yet issued carrying votingrights (whether or not these are evidencedby certificates), the total number of votingrights that would result from exercising theseconversion or subscription rights, and thetotal number of shares with no voting rights.The Company is also required to publish the

total amount of capital, the total number ofsecurities carrying voting rights and the totalnumber of voting rights, as well as abreakdown by class (where appropriate) ofthe number of securities carrying votingrights and the total number of voting rights,at the end of each calendar month duringwhich changes occurred in these amounts.Where appropriate, the Company is alsorequired to publish the total number of

Econocom’s largest 1.9.shareholderJean-Louis Bouchard, Chairman ofEconocom group, remains Econocom’slargest shareholder, with approximately36.4% of the share capital at 31 December2019.


08statutory auditor’s report on the consolidated financial statementsStatutory auditor’s report to the general shareholders’ meeting on the consolidated accounts 274

Report on the consolidated accounts 274Other legal and regulatory requirements 279


08 statutory auditor’s report on the consolidated financial statementsstatutory auditor’s report to the general shareholders’ meeting on the consolidated accounts

Statutory auditor’s report to the general shareholders’ meeting on the consolidated accounts for the year ended 31 December 2019

We present to you our statutory auditor’s report in the context of our statutory audit of theconsolidated accounts of Econocom Group SE (the “Company”) and its subsidiaries (jointly“the Group”). This report includes our report on the consolidated accounts, as well as theother legal and regulatory requirements. This forms part of an integrated whole and isindivisible.

We have been appointed as statutory auditor by the general meeting d.d. 21 May 2019,following the proposal formulated by the board of directors and following therecommendation by the audit committee and the proposal formulated by the works’council. Our mandate will expire on the date of the general meeting which will deliberateon the annual accounts for the year ended 31 December 2020. We started the statutoryaudit of the Consolidated Financial Statements of Econocom Group SE before 1990.

Report on the consolidated accounts

Unqualified opinion

We have performed the statutory audit of the Group’s consolidated accounts, whichcomprise the consolidated statement of financial position as at 31 December 2019, theconsolidated income statement and earnings per share, the consolidated statement ofcomprehensive income, the consolidated statement of changes in equity and theconsolidated statement of cash flows for the year then ended, as well as notes, comprisinga summary of significant accounting policies and other explanatory information. The totalof the consolidated statement of financial position amounts to EUR 2.936,8 million and theconsolidated income statement shows a profit for the year attributable to owners of theparent of EUR 44,7 million.

In our opinion, the consolidated accounts give a true and fair view of the Group’s net equityand consolidated financial position as at 31 December 2019, and of its consolidated financialperformance and its consolidated cash flows for the year then ended, in accordance withInternational Financial Reporting Standards as adopted by the European Union and withthe legal and regulatory requirements applicable in Belgium.


08statutory auditor’s report on the consolidated financial statementstatutory auditor’s report to the general shareholders’ meeting on the consolidated accounts

Basis for unqualified opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) asapplicable in Belgium. Furthermore, we have applied the International Standards onAuditing as approved by the IAASB which are applicable to the year-end and which are notyet approved at the national level. Our responsibilities under those standards are furtherdescribed in the “Statutory auditor’s responsibilities for the audit of the consolidatedaccounts” section of our report. We have fulfilled our ethical responsibilities in accordancewith the ethical requirements that are relevant to our audit of the consolidated accounts inBelgium, including the requirements related to independence.

We have obtained from the board of directors and Company officials the explanations andinformation necessary for performing our audit.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.

Observation - Subsequent event of the year end

As far as the COVID 19 pandemic is concerned, we draw attention to point 6 of themanagement report and to note 23 "Subsequent events" of the consolidated accounts. Thegroup indicates that, although the consequences of the pandemic on its whole business in2020 are difficult to measure at this stage, this pandemic had no significant impact on itsfinancial situation for the year ended 31 December 2019. Our opinion is not qualified inrespect of this matter.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of mostsignificance in our audit of the consolidated accounts of the current period. These matterswere addressed in the context of our audit of the consolidated accounts as a whole, and informing our opinion thereon, and we do not provide a separate opinion on these matters.

Annual goodwill impairment test

Description of the Key Audit Matter

The assets side of the consolidated financial statements of EconocomGroup as at 31 December 2019 show an amount of EUR 512,9 million forgoodwill to be tested annually for impairment as required byInternational Financial Reporting Standards (see note 9 of theconsolidated accounts).

We considered these impairment tests as a key audit matter becausegoodwill accounts for 17% of total assets as at 31 December 2019 andbecause its recoverable amount as determined by the Board of Directorsis based on assumptions related to, among other elements, the businessplan (sales, profit margin, working capital needs), the cash flow growthratio beyond the forecast period, and the cash flow discount rate.



How our Audit addressed the Key Audit Matter

We received the goodwill impairment tests from Econocom Group andwe challenged the reasonableness of the method and key assumptionsused.

In the performance of the above procedures, we relied on our in-houseexperts of the Valuation practice group. We compared the assumptionswith market assumptions and with economic forecasts (among otherthings). We also reviewed Econocom Group’s strategic plan developmentprocedure as approved by the Company’s Board of Directors. In addition,we received and reviewed the sensitivity analyses to determine theimpact of possible changes in key assumptions, and we performed ourown independent sensitivity analysis to quantify the negative impact onmanagement’s models that would result in depreciation. We particularlyfocused on the CGU Services, representing the major part of goodwill(EUR 399,1 million). We also analysed the reasonableness of thediscounted future cash flow forecasts by comparing them with theGroup’s market capitalisation.

Residual interest in leased assets

Description of the Key Audit Matter

The residual interest in leased assets as at 31 December 2019 (see note 11of the consolidated accounts) amount to EUR 164,9 million, i.e. EUR33 million in current assets and EUR 131,9 million in non-current assets.Overall, residual interests as at 31 December 2019 account for 2.7% of thehistoric acquisition value of the portfolio of assets leased out byEconocom Group.

These residual interests agree with the start-of-lease forecast of theend-of-lease market value of the assets. The carrying amount of theseassets depends on various calculation methods and on whether itconcerns fixed-term contracts or renewable contracts (« TRO »). In eithercase, the carrying amount of the assets depends on assumptions basedon historic statistics on the end-of-lease realisation value of the assetsdisposed of, but also on discount rate assumptions as regards thefixed-term contracts. The Group regularly updates these assumptions onthe basis of its experience with resale or sublease markets forsecond-hand materials. We considered the residual interest in leasedassets as a key audit matter because these estimates impact the timingof recognition of such contracts, on the one hand, and there is a risk ofdepreciation if the forecast figures would prove to exceed fair marketvalues.


08statutory auditor’s report on the consolidated financial statementsstatutory auditor’s report to the general shareholders’ meeting on the consolidated accounts

How our Audit addressed the Key Audit Matter

We obtained the key estimates of the residual interest in leased assets aswell as of the year-over-year changes in hypotheses. We criticallyevaluated the procedure put in place by Econocom Group managementfor proper application to the above estimates and we checked, on asample basis, the system for correct contract data input. Subsequently,using management’s assumptions, we recalculated the value of theresidual interest in leased assets for the entire population. Finally, weascertained that the margins realised on the end-of-lease disposal of theassets were positive. We found these assumptions to be consistent and inline with our expectations.

Responsibilities of the board of directors for the preparation of the consolidatedaccounts

The board of directors is responsible for the preparation of consolidated accounts that givea true and fair view in accordance with International Financial Reporting Standards asadopted by the European Union and with the legal and regulatory requirements applicablein Belgium, and for such internal control as the board of directors determines as necessaryto enable the preparation of consolidated accounts that are free from materialmisstatement, whether due to fraud or error.

In preparing the consolidated accounts, the board of directors is responsible for assessingthe Group’s ability to continue as a going concern, disclosing, as applicable, matters relatedto going concern and using the going concern basis of accounting unless the board ofdirectors either intends to liquidate the Group or to cease operations, or has no realisticalternative but to do so.

Statutory auditor’s responsibilities for the audit of the consolidated accounts

Our objectives are to obtain reasonable assurance about whether the consolidatedaccounts as a whole are free from material misstatement, whether due to fraud or error,and to issue an auditor’s report that includes our opinion. Reasonable assurance is a highlevel of assurance, but is not a guarantee that an audit conducted in accordance with ISAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if, individually or in the aggregate, they couldreasonably be expected to influence the economic decisions of users taken on the basis ofthese consolidated accounts.

In performing our audit, we comply with the legal, regulatory and normative frameworkapplicable to the audit of the consolidated accounts in Belgium. A statutory audit does notprovide any assurance as to the Group’s future viability nor as to the efficiency oreffectiveness of the board of directors’ current or future business management at Grouplevel.



As part of an audit in accordance with ISAs, we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated accounts,•whether due to fraud or error, design and perform audit procedures responsive to thoserisks, and obtain audit evidence that is sufficient and appropriate to provide a basis for ouropinion. The risk of not detecting a material misstatement resulting from fraud is higherthan for one resulting from error, as fraud may involve collusion, forgery, intentionalomissions, misrepresentations, or the override of internal control;

Obtain an understanding of internal control relevant to the audit in order to design audit•procedures that are appropriate in the circumstances, but not for the purpose ofexpressing an opinion on the effectiveness of the Group’s internal control;

Evaluate the appropriateness of accounting policies used and the reasonableness of•accounting estimates and related disclosures made by the board of directors;

Conclude on the appropriateness of the board of directors’ use of the going concern basis•of accounting and, based on the audit evidence obtained, whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Group’s abilityto continue as a going concern. If we conclude that a material uncertainty exists, we arerequired to draw attention in our statutory auditor’s report to the related disclosures in theconsolidated accounts or, if such disclosures are inadequate, to modify our opinion. Ourconclusions are based on the audit evidence obtained up to the date of our statutoryauditor’s report. However, future events or conditions may cause the Group to cease tocontinue as a going concern;

Evaluate the overall presentation, structure and content of the consolidated accounts,•including the disclosures, and whether the consolidated accounts represent theunderlying transactions and events in a manner that achieves fair presentation;

Obtain sufficient and appropriate audit evidence regarding the financial information of•the entities or business activities within the Group to express an opinion on theconsolidated financial statements. We are responsible for the direction, supervision andperformance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the board of directors and the audit committee regarding, amongother matters, the planned scope and timing of the audit and significant audit findings,including any significant deficiencies in internal control that we identify during our audit.

We also provide the Audit Committee with a statement that we have complied withrelevant ethical requirements regarding independence, and to communicate with them allrelationships and other matters that may reasonably be thought to bear on ourindependence, and where applicable, related safeguards.

From the matters communicated with the Audit Committee, we determine those mattersthat were of most significance in the audit of the consolidated accounts of the currentperiod and are therefore the key audit matters. We describe these matters in our auditor’sreport unless law or regulation precludes public disclosure about the matter.


08statutory auditor’s report on the consolidated financial statementsstatutory auditor’s report to the general shareholders’ meeting on the consolidated accounts

Other legal and regulatory requirements

Responsibilities of the board of directors

The Board of Directors is responsible for the preparation and the content of the directors’report on the consolidated accounts, of the separate report on non-financial informationand the other information included in the annual report on the consolidated accounts.

Statutory auditor’s responsibilities

In the context of our mandate and in accordance with the Belgian standard which iscomplementary to the International Standards on Auditing (ISAs) as applicable in Belgium,our responsibility is to verify, in all material respects, the directors’ report on theconsolidated accounts, the separate report on non-financial information, and the otherinformation contained in the annual report on the consolidated accounts, as well as toreport on these matters.

Aspects related to the directors’ report on the consolidated accounts and to the otherinformation included in the annual report on the consolidated accounts

In our opinion, after having performed specific procedures in relation to the directors’report on the consolidated accounts, this directors’ report is consistent with theconsolidated accounts for the year under audit, and is prepared in accordance witharticle 3:32 of the Companies’ and Associations’ Code.

In the context of our audit of the consolidated accounts, we are also responsible forconsidering, in particular based on the knowledge acquired resulting from the audit,whether the directors’ report on the consolidated accounts and the other informationcontained in the annual report on the consolidated accounts, namely chapters 1 to 4, 7 and9 to 11, is materially misstated or contains information which is inadequately disclosed orotherwise misleading. In light of the procedures we have performed, there are no materialmisstatements we have to report to you.

The non-financial information is included in a separate report which is part of section 3 ofthe annual report on the consolidated accounts. The report of non-financial informationcontains the information required by virtue of article 3:32, §2 of the Companies’ andAssociations’ Code, and agrees with the consolidated accounts for the same year. TheCompany has prepared the non-financial information, based on the principles of the UnitedNations Global Compact. However, in accordance with article 3:80, §1, 5° of the Companies’and Assocations’ Code, we do not express an opinion as to whether the non-financialinformation has been prepared in accordance with the principles of the United NationsGlobal Compact as disclosed in the consolidated accounts.



Statement related to independence

Our registered audit firm and our network did not provide services which are•incompatible with the statutory audit of the consolidated accounts and our registeredaudit firm remained independent of the Group in the course of our mandate.

The fees for additional services which are compatible with the statutory audit of the•consolidated accounts referred to in article 3:65 of the Companies’ and Associations’ Codeare correctly disclosed and itemized in the notes to the consolidated accounts.

Other statement

This report is consistent with the additional report to the Audit Committee referred to in•article 11 of the Regulation (EU) N° 537/2014.

Sint-Stevens-Woluwe, 1 April 2020

The statutory auditor

PwC Réviseurs d’Entreprises SRL / Bedrijfsrevisoren BV

Represented by

Alexis Van Bavel

Réviseur d’Entreprises / Bedrijfsrevisor


09chairman’s statement


09 CHAIRMAN’S STATEMENTchairman’s statement

Chairman’s statement

We hereby declare that, to the best of our knowledge, the consolidated financial statementsfor the year ended 31 December 2019, prepared in accordance with the International FinancialReporting Standards (IFRS) as adopted in the European Union, and with the legalrequirements applicable in Belgium, give a true and fair view of the assets, financial positionand profit or loss of the Company and the undertakings in the consolidation taken as a whole,and that the Management Report includes a fair review of the performance of the businessand the profit or loss and financial position of the Company and the undertakings in theconsolidation taken as a whole, together with a description of the main risks anduncertainties.

9 March 2020

On behalf of the Board of Directors

Jean-Louis Bouchard

Chairman of the Board


10condensed parent company financial statements*

Parent company statement of 1.financial position 284

Parent company income 2.statement 286

Parent company statement of 3.cash flows 288

ECONOCOM GROUP SE PARENT STATUTORY FINANCIAL STATEMENTSIn accordance with article 105 of the Belgian Companies Code, Econocom Group SE hereby states that thefollowing financial statements are an abridged version of the full annual financial statements that can beobtained from the Company and which will be filed with the Banque Nationale de Belgique. This abridgedversion does not contain all of the notes to the parent company financial statements or the StatutoryAuditor's report, which contained an unqualified audit opinion in relation to the annual financial statements.

* The parent company financial statements are prepared in accordance with Belgian GAAP.


10 condensed parent company financial statementsparent company statement of financial position

Parent company statement 1.of financial positionAsset

in € thousands 31 Dec. 2019 31 Dec. 2018

Start-up costs 1,348 1,879

Fixed assets 1,022,009 935,435

Intangible assets 0

Property, plant and equipment 5 8

Plant and equipment, fixtures and fittings 5 8

Long-term financial assets 1,022,004 935,427

Related parties 1,006,571 926,651

Equity interests 756,271 676,351

Receivables 250,300 250,300

Entities with which there are capital links 485 467

Equity interests 485 467

Receivables 0

Other long-term financial assets 14,948 8,309

Shares 11,130 7,224

Receivables and cash guarantees 3,818 1,086

Current assets 68,962 167,276

Non-current receivables 0

Trade receivables

Other receivables

Inventories and work-in-progress 0

Current receivables 11,188 122,257

Trade receivables 5,124 9,075

Other receivables 6,064 113,182

Cash investments 57,050 40,678

Treasury shares* 57,050 40,678

Other investments 0

Cash and cash equivalents 435 3,780

Accrual accounts 289 561

Total assets 1,092,319 1,104,591

Including impairment (33,461).*


10condensed parent company financial statementsparent company statement of financial position

Liabilities


Total equity 349,028 394,818

Share capital 23,513 23,490

Paid-in capital 23,513 23,490

Uncalled capital

Issue premiums 194,708 223,514

Revaluation gain 2,520 2,520

Reserves 59,819 43,444

Statutory reserve 2,351 2,349

Unavailable reserves 57,050 40,678

For treasury shares 57,050 40,678

Available reserves 418 418

Retained earnings (+)/(-) 87,552 104,117

Profit for the year (19,084) (2,267)

Provisions and deferred taxes 1,921 4,612

Provisions for contingencies and losses 1,921 4,612

Other contingencies and losses 1,921 4,612

Deferred taxes

Payables 741,370 705,160

Non-current liabilities 440,130 436,765

Financial liabilities 440,130 436,765

Unsubordinated bonds 440,130 436,765

Trade payables 0 0

Prepayments received on orders

Other non-current liabilities

Current liabilities 301,240 268,395

Current portion of non-current liabilities 2,646 2,662

Financial liabilities 278,500 254,900

Bank loans and borrowings 278,500 254,900

Trade payables 1,398 5,944

Trade payables 1,398 5,944

Accrued taxes and personnel costs 1,260 1,532

Income tax expense 667 72

Compensation including payroll costs 593 1,460

Other non-current liabilities 17,436 3,357

Accrual accounts

Total equity and liabilities 1,092,319 1,104,591


10 condensed parent company financial statementsparent company income statement

Parent company income 2.statementin € thousands 31 Dec. 2019 31 Dec. 2018

Sales and Services 25,673 30,521

Revenue 22,036 24,753

Changes in inventories of finished goods and work in progress: increase (decrease) (+)/(-)

In-house production of fixed assets

Other operating income 3,637 4,687

Non-recurring operating income 0 1,080

Cost of sales and Services 23,005 25,438

Materials and goods for resale

Services and miscellaneous goods 24,014 25,104

Personnel costs (including payroll costs) and pensions (+)/(-) 1,597 2,679

Amortisation/depreciation and impairment of start-up costs, property, plant and equipment and intangible assets 5 6

Additions to (reversals of) impairment of inventories, work-in-progress and trade receivables (+)(-) 0 0

Additions to (reversals of) provisions for contingencies and losses (+)(-) (2,691) (2,385)

Other operating expenses 80 33

Capitalised restructuring costs (-)

Non-recurring operating expenses

Operating income 2,668 5,084

Financial income 38,884 32,250

Recurring financial income 32,245 31,038

Income from long-term financial assets 25,165 25,209

Income from current assets 1,922 1,254

Other financial income 5,158 4,575

Non-recurring financial income 6,639 1,212

Financial expenses 58,755 39,344

Recurring financial expenses 12,745 16,758

Cost of debt 12,157 10,493

Additions to (reversals of) impairment of current assets other than inventories, work-in-progress and trade receivables (+)/(-) 150 2

Other financial expenses 438 6,263

Non-recurring financial expenses 46,010 22,586


10condensed parent company financial statementsparent company income statement


Profit for the year before tax (+)/(-) (17,203) (2,011)

Withdrawal from deferred taxes

Transfer to deferred taxes

Income tax (+)/(-) 1,881 257


Tax adjustments and reversals of tax-related provisions 1,242 (128)

Profit for the year (19,084) (2,267)

Deductions from tax-free reserves

Transfers to tax-free reserves

Profit for the year available for distribution (+)/(-) (19,084) (2,267)


Profit available for distribution (+)/(-) 82,766 83,340

Profit for the year available for distribution (+)/(-) (19,084) (2,267)

Retained earnings (+)/(-) 101,850 85,607

Deductions from equity 9,593 23,868

from equity and issue premiums

from reserves 9,593 23,868

Appropriations to equity 23,891 5,358

to equity and issue premiums

to the statutory reserve 2 0

to other reserves 23,889 5,358

Appropriation to retained earnings (+)/(-) 68,468 101,850

Share of associates in losses

Profit available for distribution

Dividends

Directors or managers

Employees

Other beneficiaries


10 condensed parent company financial statementsparent company statement of cash flows

Parent company statement 3.of cash flowsin € thousands 31 Dec. 2019 31 Dec. 2018

Profit (19,084) (2,267)


Depreciation, amortisation and impairment 26,101 22,592

Impact of changes in provisions for other contingencies and losses (2,691) (2,516)

Gains/losses on disposal of long-term financial assets

Dividends received from equity interests (18,570) (18,951)

Interest received on non-current financial receivables (6,515) (6,177)

Gains/losses on disposal of treasury shares 180 5,712

Cash flow from operating activities (a) (19,940) (1,222)

Change in current receivables 111,069 (101,763)

Change in other current assets 272 (362)

Change in trade payables (4,547) 1,160

Change in accrued taxes and personnel costs (current portion) (272) 146

Change in other current liabilities 14,140 2,456

Change in working capital requirements (b) 120,662 (98,363)

Income tax expense (c) (639) (385)

Net cash from (used in) operating activities (a + b + c) 100,083 (99,970)

Start-up costs

Acquisition of property, plant and equipment and intangible assets for internal use (2) (2)

Disposal of property, plant and equipment and intangible assets for internal use

Acquisition of equity interests (101,824) (86,483)

Disposal of equity interests 6,402 300

Acquisition of non-current financial receivables (200,000)

Repayment of non-current financial receivables 50,700

Acquisition of other long-term financial assets (7,636) (2,708)

Disposal of other long-term financial assets 479 351

Dividends received from equity interests 18,570 18,951

Interest received on non-current financial receivables 6,515 6,177


10condensed parent company financial statementsparent company statement of cash flows


Net cash from (used in) investing activities (d) (77,496) (212,714)

Euro Private Placement – issue costs 106 106

Euro Private Placement – financial expenses 2,632 2,632

Euro Private Placement – interest (2,632) (2,632)

Schuldschein loans – issue costs 126 126

Schuldschein loans – financial expenses 2,781 2,788

Schuldschein loans – interest (2,797) (2,823)

OCEANE (2018 issue) 200,000

OCEANE – issue costs 298 (1,383)

OCEANE – financial expenses 4,364 3,587

OCEANE – coupons (1,000)

Commercial paper 23,600 152,900

Acquisition of treasury shares (28,371) (27,714)

Disposal of treasury shares 2,226 15,507

Dividends paid during the year/refund of additional paid-in capital (27,265) (28,129)

Change in other liabilities

Net cash from (used in) financing operations (e) (25,932) 314,965

Change in cash and cash equivalents (a + b + c + d + e) (3,345) 2,281

10 condensed parent company financial statements



11key consolidated figures


11 key consolidated figureskey consolidated figures

Key consolidated figures

2013Publishedin 2014 AR

2014Restated 2015

2016Adjusted

Publishedin 2017AR****

2018 2019

Number of shares (at 31 December)

Ordinary shares 213,034,628 225,038,574 225,038,574 225,038,574 245,140,430 245,380,430

Total 213,034,628 225,038,574 225,038,574 225,038,574 245,140,430 245,380,430

Free float 48.44% 57.67% 53.82% 54.20% 57.86% 57.90%

Average number of sharesoutstanding

191,880,800 219,876,782 217,017,790 215,443,595 232,763,830 227,816,144

Per share data (in €)

Net dividend (on ordinary shares)* 0.05 0.08 0.09 0.1 0.12 0.12

Gross dividend (on ordinary shares)* 0.06 0.08 0.09 0.1 0.12 0.12

Profit (loss) from continuing ordinary operations**

0.48 0.42 0.53 0.63 0.46 0.55

Pay-out(1) 0.15 0.26 0.17 0.67 0.71 0.61

Operating profit** 0.41 0.31 0.50 0.57 0.37 0.44

Profit before tax** 0.36 0.26 0.42 0.32 0.31 0.35

Profit for the period (attributable to owners of the parent)**

0.23 0.14 0.27 0.15 0.17 0.20

Cash flow from operating activities ** 0.41 0.39 0.46 0.56 0.45 0.61

Equity attributable to owners of the parent***

1.22 1.16 1.02 0.89 2.0 1.97

Price/earnings(2) 18 23 16 45 17 12

Price/cash flow from operating activities(3) 10 8 9 12 6 4

Net yield(4) 1.08% 2.29% 2.05% 1.43% 4.1% 4.9%

Gross yield(4) 1.44% 2.29% 2.05% 1.43% 4.1% 4.9%


11key consolidated figureskey consolidated figures

2013Publishedin 2014 AR

2014Restated 2015

2016Adjusted

Publishedin 2017AR****

2018 2019

Stock market data (in €)

Average 3.10 3.55 3.85 5.69 3.70 3.01

At 31 december 4.16 3.28 4.275 6.97 2.91 2.43

High 4.18 4.58 4.49 7.17 7.3 4.01

Low 2.49 2.42 3.01 3.69 2.28 2.00

Annual yield at 31 December(5) 41% (19%) 33% 65% (49%) (12.3%)

Annual volume (in units) 42,978,376 58,190,840 49,761,106 54,198,704 213,263,403 53,631,539

Average daily trading volume 169,876 228,200 194,380 210,888 836,327 210,320

Annual volume (value) (in € millions) 281 201 383 308 789 161

Market capitalisation at 31 December(in € millions)(6)

886 738 962 1 569 713 597

Listing market(7) TC TC TC TC TC TC

Salaried employees 8,195 8,587 9,134 10,008 10,813 10,323

Refund of issue premiums.*

Expressed as a ratio of the average number of shares outstanding.**

Expressed as a ratio of total shares.***

In the 2017 table, the number of shares is shown after the share split approved by the Extraordinary General****

Meeting of 16 May 2017.Payout rate: gross return/profit for the year attributable to owners of the parent before amortisation or reduction(1)

of goodwill.Share price at 31 December/profit for the year.(2)

Share price at 31 December/cash flows from operating activities before cost of net debt and income tax.(3)

Net (gross) yield/share price at 31 December.(4)

Annual yield = change in share price at 31 December relative to 31 December of the previous year plus net(5)

return/share price at 31 December of the previous year.Market capitalisation = total number of shares at 31 December x share price at 31 December.(6)

Listing market = Brussels from 9 June 1988. The share has been listed on the Marché à terme continu (TC) since(7)

16 March 2000.


011 KEY CONSOLIDATED FIGURES

Econocom group addressesThe Econocom BrandAustriaFranzosengraben 12A – 1030 ViennaTel.: +43 1 79520 [email protected]

BelgiumEconocom (registered office)Place du Champ de Mars, 5/ B141050 Brussels

Parc HorizonChaussee de Louvain 510/B801930 ZaventemTel.: +32 2 790 81 [email protected]

Canada249 St Jacques StreetSuite 302MontrealQuebec H2Y 1M6Tel.: + 1 514 664 1192

Czech RepublicAnděl ParcRadlická 14 / 3201 – Smíchov150 00 Prague 5Tel.: +420 225 100 [email protected]

France42 Rue Médéric92110 ClichyTel.: +33 1 41 67 30 [email protected]

21 Avenue DescartesImmeuble Astrale92350 Le Plessis-RobinsonTel.: +33 1 73 23 87 00

GermanyHerriotstr. 860528 Frankfurt am MainTel.: +49 69 [email protected]

Ireland3rd Floor IFSC HouseCustom House QuayDublin 1Tel.: +353 1 [email protected]

Italyc/o Econocom VillageVia Varesina 16220156 MilanTel.: +39 02 33 62 [email protected]

Luxembourg4 rue d’ArlonL-8399 WindhofTel.: +352 39 55 [email protected]

MoroccoTechnopolisBatiment B111100 Sala Al JadiaTel.: +212 5 38 04 33 [email protected]

1st floor, Residence Boissy322 Bd Zerktoun20270 CasablancaTel.: +212 (0) 522 789 [email protected]

PolandUlica Twarda 1800-105 WarsawTel.: +48 22 202 67 [email protected]

SpainC/ Cardenal Marcelo Spinola28016 MadridTel.: +34 91 411 91 [email protected]

C/ Pallars, 9908018, BarcelonaTel.: +34 93 470 30 [email protected]

SwitzerlandRoute de Champ-Colin 12CH-1260 NyonTel.: +41 22 363 79 [email protected]

The NetherlandsComputerweg 22NL-3542 DR UtrechtTel.: +31 30 63 58 [email protected]

UKEton House18/24 Paradise RoadRichmond-upon-ThamesSurrey TW9 1SETel.: +44 20 8940 [email protected]

US149 East 36th StreetNew York, NY, 10016Tel.: +1 514 664 1192


011KEY CONSOLIDATED FIGURES

The group’s other brandsBrasilEconocom BrasilAv. Sagitário, 138 - 24º andarTorre City – Alpha SquareOfficesAlphaville – SPCep : 06473-073Tel.: +55 11 [email protected]

FranceAlter Way1 Rue Royale, Batiment D227, Les Bureaux de la Colline92210 Saint-CloudTel.: +33 1 41 16 34 [email protected]

Aragon-eRHTour Vista52 Quai de Dion Bouton92800 PuteauxTel.: +33 01 41 67 32 [email protected]

ASP Serveur785 Voie Antiope13600 La CiotatTel.: 0 805 360 [email protected]

Cineolia51 Avenue du Maréchal Joffre92000 NanterreTel.: + 33 9 67 85 13 [email protected]

Digital Security50 Avenue Daumesnil75012 ParisTel.: + 33 1 70 83 85 [email protected]

Les Collines de l’Arche76 Route de la Demi-LuneImmeuble Madeleine D92057 ParisLa Défense CedexTel.: +33 1 39 62 00 [email protected]

DMS42 Rue Mederic92110 ClichyTel.: +33 1 41 67 36 [email protected]

Exaprobe13 B Avenue Albert EinsteinCS9021769623 Villeurbanne CedexTel.: +33 4 72 69 99 [email protected]

Fifty Eight16 Rue Washington75008 [email protected]

Helis6 Rue Royale75008 ParisTel.: +33 1 53 20 05 [email protected]

Infeeny5 Rue d’Uzes75002 ParisTel.: +33 1 49 70 81 [email protected]

Rayonnance114 Avenue Charles de Gaulle92 522 Neuilly sur Seine – CedexTel.: +33 1 42 33 34 [email protected]

Synertrade66 Avenue Charles de Gaulle92200 Neuilly-sur-SeineTel.: +33 1 56 98 29 [email protected]

GermanyEnergy Net GmbHGutleutstraße 165-17160327 Francfort-sur-le-MainTel.: +49 69 [email protected]

ItalyAsystel ItaliaVia Perin del Vaga 1620156 MilanTel.: +39 02 38 084 [email protected]

Bizmaticac/o Econocom VillageVia Varesina 16220156 MilanTel.: +39 02 8312 [email protected]

LuxembourgSynertrade12 Rue Guillaume Schneider2522 LuxembourgTel.: +352 09 29 27 [email protected]

SpainAltaboxC/Arquimedes, 65533211 Gijón, AsturiasTel.: +34 902 43 00 [email protected]

GigigoCalle Dr. Zamenhof, 36 bis,28027 MadridTel. +34 91 743 [email protected]

NexicaC/ Acer, 30-32, 1r 4a08038 BarcelonaTel.: + 34 902 202 [email protected]

UKJTRS LtdSuite 1 Fulshaw HallAlderley Road,Wilmslow Cheshire SK9 1RLTel.: 0330 223 [email protected]

See the complete list of our regional addresses on www.econocom.com

11 key consolidated figures


N°Vert 0800 716 715 (France) +33 800 716 715 (International)

Econocom Communications Department

42 Rue Médéric

92110 CLICHY FRANCE

email: [email protected]

April 2020

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THE ESSENTIALS · 2020-04-28 · 2019 annual report 9 the essentials 01 the econocom galaxy 2. The Econocom galaxy An agile organisation for sustainable digital transformation Econocom