2016 consolidated financial statements and notes by Digital Expression

FINANCIAL STATEMENTS

9.1 2016 consolidated financial statements and notes Consolidated balance sheet ASSETS (in thousands of euros)

Note

12/31/2016

12/31/2015

Non-current assets Intangible assets

4.3

22,905

20,215

Goodwill

4.2

773,013

771,244

Property, plant and equipment

4.1

1,192,340

1,133,160

129,922

120,006

4.5.1

92,598

114,684

4.6

12,521

7,011

4.5.3

322

261

2,223,621

2,166,581

4.7

246,615

207,069

4.5.4

381,595

342,398

Investments in joint ventures Other ďŹ nancial assets Deferred tax assets Other non-current assets TOTAL NON-CURRENT ASSETS (I) Current assets Inventory and work in progress Trade and other receivables Tax receivables Other current assets

4.5.2

Cash and cash equivalents

4.5.5

TOTAL CURRENT ASSETS (II)

9,870

8,778

19,243

15,119

833,652

786,456

1,490,975

1,359,820

3,714,596

3,526,401

TOTAL GROUP OF ASSETS HELD FOR SALE (III) TOTAL ASSETS (I + II + III)

178

RUBIS /// 2016 REGISTRATION DOCUMENT

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Consolidated balance sheet EQUITY AND LIABILITIES (in thousands of euros)

Note

12/31/2016

12/31/2015

113,637

108,042

1,084,251

962,398

Shareholders’ equity, Group share Share capital Share premium Retained earnings Total Non-controlling interests SHAREHOLDERS’ EQUITY (I)

659,503

487,405

1,857,391

1,557,845

129,044

99,514

4.8

1,986,435

1,657,359

4.10.1

798,874

870,133

Non-current liabilities Borrowings and ﬁnancial debt Deposit/consignment

102,967

95,095

Provisions for pensions and other employee beneﬁt obligations

4.12

47,702

44,227

Other provisions

4.11

77,165

75,044

4.6

49,597

51,390

4.10.3

3,847

122,287

1,080,152

1,258,176

Deferred tax liabilities Other non-current liabilities TOTAL NON-CURRENT LIABILITIES (II) Current liabilities Borrowings and short-term bank overdrafts (portion due in less than one year)

4.10.1

262,464

253,025

Trade and other payables

4.10.4

355,243

330,497

Current tax liabilities Other current liabilities TOTAL CURRENT LIABILITIES (III)

4.10.3

7,343

7,366

22,959

19,978

648,009

610,866

3,714,596

3,526,401

TOTAL LIABILITIES RELATED TO A GROUP OF ASSETS HELD FOR SALE (IV) TOTAL LIABILITIES (I + II + III + IV)

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Consolidated income statement 12/31/2016

12/31/2015

Sales of merchandise

1,935,932

1,902,692

Revenue from manufacturing of goods and services

1,067,948

1,010,683

3,003,880

2,913,375

(in thousands of euros)

NET REVENUE

Note

5.1

Other operating income

1,858

2,699

Consumed purchases

5.2

(2,031,669)

(2,086,445)

External expenses

5.4

(302,023)

(256,978)

Payroll expenses

5.3

(179,919)

(156,087)

Taxes Net depreciation and provisions

5.5

Other operating income and expenses

5.6

EBITDA EBIT Other operating income and expenses

(463)

(1,781) 344,556

25%

299,675

240,008

1,545

5,346

23%

301,220

245,354

6,798

4,976

23%

308,018

250,330

Income from cash and cash equivalents Gross interest expense and cost of debt COST OF NET FINANCIAL DEBT

5.8

Other ﬁnancial income and expenses

5.9

INCOME BEFORE TAX INCOME TAX

(105,466)

411,495

Share of earnings from joint ventures OPERATING INCOME AFTER PROFIT/LOSS FROM JOINT VENTURES

(69,309)

(113,215) 19%

5.7

OPERATING INCOME BEFORE PROFIT/LOSS FROM JOINT VENTURES

(78,774)

13% 21%

5.10

4,022

4,842

(17,181)

(16,459)

(13,159)

(11,617)

(3,162)

3,133

291,697

241,846

(64,320)

(59,617)

TOTAL NET INCOME

25%

227,377

182,229

NET INCOME, GROUP SHARE

22%

208,022

169,880

NET INCOME, MINORITY INTERESTS

57%

19,355

12,349

Undiluted earnings per share (in euros)

5.11

14%

4.70

4.13

Diluted earnings per share (in euros)

5.11

14%

4.64

4.06

12/31/2016

12/31/2015

227,377

182,229

12,253

49,465

2,519

(1,701)

Statement of other comprehensive income (in thousands of euros) TOTAL CONSOLIDATED NET INCOME (I) Foreign exchange differences Hedging instruments Income tax on hedging instruments

(836)

587

3,111

8,690

Items that will subsequently be recycled in P&L (II)

17,047

57,041

Actuarial gains and losses

(1,081)

3,007

459

(370)

(622)

2,634

Items recyclable in P&L from joint ventures

Income tax on actuarial gains and losses Items not recyclable in P&L from joint ventures Items that will not subsequently be recycled in P&L (III) COMPREHENSIVE INCOME FOR THE PERIOD (I+II+III)

243,802

241,904

SHARE ATTRIBUTABLE TO THE OWNERS OF THE GROUP’S PARENT COMPANY

221,108

229,474

22,694

12,430

SHARE ATTRIBUTABLE TO NON-CONTROLLING INTERESTS

180

(3)

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FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Consolidated statement of changes in shareholders’ equity

Shares outstanding

Including treasury shares

Share capital

Share premium

Treasury shares

(number of shares) SHAREHOLDERS’ EQUITY AS OF DECEMBER 31, 2014

38,869,079

14,000

Consolidated reserves and earnings

Shareholders’ equity attributable to the owners of the Group’s Foreign parent exchange company differences

NonTotal controlling interests consolidated (minority shareholders’ equity interests)

(in thousands of euros) 386,071

42,837

1,296,968

23,850

1,320,818

COMPREHENSIVE INCOME FOR THE PERIOD

97,173

771,532

(646)

171,706

57,768

229,474

12,430

241,904

Percentage change in interest

(91,353)

67,426

(23,927)

3,903

1,087

202,822

Share-based payments Capital increase

4,347,873

Treasury shares

10,869

190,866

1,762

(444)

Dividend payment Other changes SHAREHOLDERS’ EQUITY AS OF DECEMBER 31, 2015

43,216,952

15,762 108,042

962,398

(1,090)

345

(99)

(83,933)

(4,199)

(88,132)

(99)

387,888

100,605

1,557,845

99,514

1,657,359

COMPREHENSIVE INCOME FOR THE PERIOD

209,124

11,984

221,108

22,694

243,802

Percentage change in interest

70,929

18,252

89,182

4,149

559

128,007

(334)

127,673

Share-based payments Capital increase

2,237,936

Treasury shares

5,595

121,853

(1,371)

Dividend payment Other changes SHAREHOLDERS’ EQUITY AS OF DECEMBER 31, 2016

45,454,888

14,391 113,637 1,084,251

(1,088)

4,149

238

240

(124,900)

(11,102)

(136,002)

1,857,391

129,044

1,986,435

548,002

112,589

240

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Consolidated statement of cash flows (in thousands of euros)

Notes

TOTAL CONSOLIDATED NET INCOME FROM CONTINUING OPERATIONS

12/31/2016

12/31/2015

227,377

182,229

Net income from discontinued operations Adjustments: Elimination of income of joint ventures Elimination of depreciation and provisions Elimination of proﬁt and loss from disposals and dilution Elimination of dividend earnings Other income and expenditure with no impact on cash and cash equivalents(1) CASH FLOW AFTER COST OF NET FINANCIAL DEBT AND TAX

(6,798)

(4,976)

110,951

99,851

(3,820)

(1,478)

(272)

(220)

(1,286)

(14,138)

326,153

261,268

Elimination of tax expenses

64,320

59,617

Elimination of cost of net ﬁnancial debt

13,173

11,617

CASH FLOW BEFORE COST OF NET FINANCIAL DEBT AND TAX

403,646

332,502

Impact of change in WCR*

(18,288)

179,223

Tax paid

(74,033)

(62,022)

CASH FLOW RELATED TO OPERATIONS

311,325

449,703

Impact of changes to consolidation scope (cash acquired – cash disposed) Acquisition of ﬁnancial assets: Rubis Énergie Caribbean division(2)

833

65,186

(16,131)

(41,485)

Acquisition of ﬁnancial assets: Rubis Énergie Europe division

(1,153)

Acquisition of ﬁnancial assets: Rubis Énergie Africa division

(362,875)

Acquisition of ﬁnancial assets: Rubis Terminal division

(98) 15,783

Disposal of ﬁnancial assets: Rubis Énergie Europe division(3) Acquisition of property, plant and equipment and intangible assets Change in loans and advances granted Disposal of property, plant and equipment and intangible assets (Acquisition)/disposal of other ﬁnancial assets Dividends received

(162,545)

(143,305)

(6,079)

(32,697)

2,800

4,624

(203)

999

272

220

(165,270)

(510,583)

127,967

202,406

Other cash ﬂow from investment operations CASH FLOW RELATED TO INVESTMENT ACTIVITIES Capital increase

4.8

(Acquisition)/disposal of treasury shares

(444)

Borrowings issued

237,175

558,663

Borrowings repaid

(291,631)

(229,435)

(13,272)

(10,928)

(124,900)

(83,933)

Dividends payable to non-controlling interests

(11,040)

(4,193)

Acquisition of ﬁnancial assets: Rubis Énergie Africa division(4)

(38,256)

Net interest paid Dividends payable

12,392

Disposal of ﬁnancial assets: Rubis Énergie Africa division(5) Other cash ﬂows from investment operations CASH FLOWS RELATED TO FINANCING ACTIVITIES Impact of exchange rate changes

(585)

(500)

(102,147)

431,636

3,289

5,526

47,196

376,281

786,456

410,175

Impact of change in accounting principles CHANGE IN CASH AND CASH EQUIVALENTS CASH FLOW FROM CONTINUING OPERATIONS Opening cash and cash equivalents(6)

4.5.5

Change in cash and cash equivalents Closing cash and cash equivalents(6) Financial debt

47,196

376,281

4.5.5

833,652

786,456

4.10.1

(1,061,338)

(1,123,158)

(227,686)

(336,702)

Cash and cash equivalents net of ﬁnancial debt * Breakdown of the impact of change in working capital: Impact of change in inventories and work in progress Impact of change in trade and other receivables Impact of change in trade and other payables Impact of change in working capital (1) Including change in fair value of ﬁnancial instruments, goodwill (impairment, badwill), etc. The impacts from changes to consolidation scope are described in note 3. (2) Acquisition of Bermuda Gas. (3) Disposal of Multigas. (4) Acquisition of 25% of Eres Group, acquisition of non-controlling interests in Lasfargaz. (5) Disposal of 40% of Easigas (South Africa). (6) Cash and cash equivalents net of bank overdrafts.

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4.7

(40,218)

4.5.4

(40,963)

4.10.4

62,893 (18,288)

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Notes to the consolidated financial statements for the period ended December 31, 2016 1. General information

183

7. Non-controlling interests

229

2. Accounting policies

184

8. Interests in joint operations

231

3. Scope of consolidation

187

9. Interests in joint ventures

231

4. Notes to the balance sheet

193

10. Other information

233

5. Notes to the income statement

219

11. Subsequent events

235

6. Segment information

226

Note 1. General information 1.1 ANNUAL FINANCIAL INFORMATION The financial statements for the year ended December 31, 2016 were ﬁnalized by the Board of Management on March 10, 2017, and approved by the Supervisory Board on March 13, 2017. T h e 2 016 c o n s olid a te d f ina n c ial statements have been prepared in accordance with the international accounting standards issued by the IASB (International Accounting Standards Board) and adopted by the European U nio n. T h e s e s t a n d a rd s in c lu d e IFRS (International Financial Reporting Standards) and IAS (International Accounting Standards), as well as the interpretations of the IFRS Interpretations Committee.

1.2 OVERVIEW OF ACTIVITIES Rubis Group operates 3 businesses in the energy sector:

• Rubis Terminal (bulk liquid storage) via its subsidiary, Rubis Terminal, and the companies owned by the subsidiary in France (including Corsica), the Netherlands, Belgium, and Turkey,

specializes in the storage and trading of petroleum products, fertilizers, chemical produc ts and agrifood products;

• Rubis Énergie, which specializes in the trading and distribution of liquefied petroleum gas (LPG) and petroleum products;

• Rubis Support and Services, which houses all infrastructure, transportation, supply and ser vices ac tivities, suppor ting the development of downstream distribution and marketing activities.

its business in 2011 by purchasing the BP Group’s bulk LPG business goodwill in Spain. The Channel Islands of Jersey and Guernsey: via Fuel Supplies Channel Islands, a key operator throughout the local petroleum products distribution segments and the depot in La Collette. Portugal: With the acquisition on July 1, 2014 of BP’s LPG business, Rubis Energia Portugal is the Group’s leading LPG subsidiary.

Rubis Énergie and Rubis Support and Services have a presence on 3 continents:

The entities Eres NV, Maritec NV and De Rode Beuk NV, are also part of the Europe zone, from where they carry out their support activities for the bitumen division.

Europe

Africa

France: under the aegis of Vitogaz France, which stores, trades, and distributes LPG (ViTO Corse for Corsica).

Morocco: via Lasfargaz, which operates the country’s largest propane import terminal, and Vitogaz Maroc, which operates in the retail distribution sector.

Switzerland: At the close of 2016 Vitogaz Switzerland, the leading company in LPG distribution, sold its subsidiary Multigas, specializing in the packaging and distribution of high-purity ammonia and specialty gases. Spain: via Vitogas España, a challenger in LPG distribution; this entity expanded

Madagascar: via Vitogaz Madagascar, which is growing in retail distribution through an import terminal built for this purpose, and also intended for supplying the neighboring regional markets (the Comoros Islands).

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Sou t he rn Af ric a: the Group has distributed LPG in Southern Africa from the time it acquired Easigas South Africa, Easigas Botswana, Easigas Swaziland and Easigas Lesotho from the Shell Group at the end of 2010. On January 1, 2016, Easigas South Africa and Reatile Gaz signed an agreement to merge their LPG businesses in Southern Africa. Reatile Gaz, involved in LPG in South Africa and an exporter to Mozambique and Zimbabwe, operates in various energy sectors in Southern Africa. Nigeria, Togo, Senegal: at the beginning of June 2015, Rubis acquired the Eres Group, one of the main independent players in the supply-transportationlogistics-distribution of bitumen in West Africa. With major logistics operations (import depots) in Senegal, Togo and Nigeria, Eres is a leading operator, active across the entire region. With the entities acquired, Rubis now controls the entire supply chain from the purchase of bitumen from reﬁneries to its shipping, bulk land storage and delivery by truck to end customers. Ré u n i o n: through the Société Réunionnaise de Produits Pétroliers (SRPP) acquired on July 31, 2015 from the Shell and Total groups. The leading local operator, with a network of 51 gas

stations, SRPP also markets commercial heating oils, LPG and lubricants. The Company controls and operates all the supply logistics facilities on the island. D j i b o u t i: at the beginning of Oc tober 2015, Rubis won the bid for the purchase of the assets and business (goodwill) of the Total brand in Djibouti. This new development gives Rubis control of the country’s leading distributor of petroleum products, with operations spanning all segments: gas stations, aviation, commercial, marine and lubricants, representing an annual volume of more than 100,000 m3. Djibouti is strategically located at the entrance to the Red Sea, on the Horn of Africa, and has a natural advantage making it the main if not the sole maritime access of Ethiopia, a high-growth country.

Caribbean French Antilles: via Rubis Antilles Guyane, Société Antillaise des Pétroles Rubis, Rubis Guyane Française and Rubis Caraïbes Françaises, the Group is the leading LPG and petroleum products distributor in the French Antilles and French Guiana. In addition, the Group holds an interest (up from 35.5% to 71% since June 4, 2015) in the Sara reﬁnery in Martinique.

Caribbean Islands: since 2011, the Group has owned a diverse set of distribution businesses for automotive fuel, fuel oil, LPG and refueling in the countries forming the Caribbean islands: Antigua, Barbados, Dominica, Grenada, Guyana, St Lucia and St Vincent. In 2012, the Group signiﬁcantly strengthened its presence in this region, following the acquisition of Chevron’s p e t ro l e u m p ro d u c t s d i s t r i b u t io n businesses in the Bahamas, the Cayman Islands and the Turks and Caicos Islands. Bermuda: via Rubis Energy Bermuda, the country’s leading retail distributor of petroleum products, and Bermuda Gas acquired in April 2016, the major LPG distributor in Bermuda. Jamaica: on December 31, 2012, Rubis acquired an automotive fuel and fuel oil distribution network in Jamaica, giving it a leading position on the island, with a market share of around 30%. With the acquisition of the Eres Group at the beginning of June 2015, the vessels Maroni, Biskra, Viveka, Bitu Express and Equinox were consolidated into the Group. They operate out of the Caribbean for the trading and supply subsidiary REC Bitumen and make international deliveries throughout the world.

Note 2. Accounting policies 2.1

BASIS OF PREPARATION

The consolidated financial statements are prepared based on historical costs with the exception of certain categories of assets and liabilities, in accordance with IFRS rules. The categories concerned are speciﬁed in the notes below. To prepare its financial statements, the Group’s Management must make estimates and assumptions that affect the book value of assets and liabilities, income and expenses, and the data disclosed in the Notes to the ﬁnancial statements.

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The Group’s Management makes these estimates and assessments on an ongoing basis according to past experience as well as various factors that are deemed reasonable and that constitute the basis for these assessments. The amounts that will appear in its future ﬁnancial statements may differ from these estimates, in accordance with changes in these assumptions or different conditions.

The main significant estimates made by the Group’s Management pertain in particular to the fair value of business combinations, goodwill impairment tests, recognition of revenue, property, plant and equipment and intangible assets, provisions and changes in employee beneﬁt obligations. The consolidated financial statements for the year ended December 31, 2016 include the ﬁnancial statements for Rubis and its subsidiaries.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

The subsidiaries operate in their local currencies, which are used to denominate the majority of their transactions. The exceptions are Delta Rubis Petrol, located in Turkey, and its holding company Rubis Med Energy BV, located in the Netherlands, both of which operate in US dollars. Balance sheet items are translated into euros at the exchange rate applicable on the closing date, and income statement items are translated using the average exchange rate over the reporting period. Any resulting currency translation differences are recorded as foreign exchange differences and

2.2

included in consolidated shareholders’ equity. All significant transactions conducted between consolidated companies as well as internal proﬁts are eliminated. Foreign exchange differences arising from the elimination of transactions and transfers of funds denominated in foreign currencies between consolidated companies, are subject to the following accounting treatment:

• foreign exchange differences arising from the elimination of internal

transactions are recorded as “foreign exchange differences” in shareholders’ e q u i t y a n d a s “no n - c o n t ro lling interests” for the portion attributable to third parties, thereby offsetting their impact on consolidated income;

• foreign exchange differences on fund movements for reciprocal financing are classified under a separate heading in the consolidated cash flow table. The consolidated financial statements are denominated in euros and the financial statements are presented in thousands of euros.

ACCOUNTING STANDARDS APPLIED

Standards, interpretations and amendments applicable as of January 1, 2016 The following standards, interpretations and amendments, published in the Ofﬁcial Journal of the European Union as of the closing date were applied for the ﬁrst time in 2016: Date of mandatory application

Standard / Interpretation IFRS 11

Accounting for acquisitions of interests in joint operations

Amendments to IFRS 10, IFRS 12 and IAS 28

Clariﬁcations on the application of the consolidation exemption

January 1, 2016

IAS 16 and IAS 38

Clariﬁcation of acceptable methods of depreciation

January 1, 2016

IAS 19

Deﬁned beneﬁt plans: Employee contributions

January 1, 2016

Annual improvements

Annual IFRS improvements, cycle 2012-2014. Standards involved: IFRS 5 “Changes in treatment of asset disposals”; IFRS 7 “Asset management contracts”; IAS 9 “Discount rate and issues of regional markets”

January 1, 2016

The ﬁrst-time application of these interpretations and amendments did not have a material impact on the Group’s ﬁnancial statements.

Standards, interpretations and amendments applicable in advance The Group has not opted for the early adoption of the following standards, interpretations and amendments, the application of which is not mandatory as of December 31, 2016: Date of mandatory application subject to adoption by the EU

Standard / Interpretation IFRS 15 “Revenue from Contracts with Customers”

New standard concerning revenue recognition

IFRS 9 “Financial Instruments”

New standard concerning the recognition and measurement of ﬁnancial instruments

January 1, 2018

IFRS 16 “Leases”

New standard concerning the recognition of leases

January 1, 2019

January 1, 2018

Amendments to IAS 7

Disclosures on ﬁnancing activities

January 1, 2017

Amendments to IAS 12

Recognition of deferred tax assets for unrealized losses

January 1, 2017

Amendments to IFRS 2

Classiﬁcation and measurement of share-based payment transactions

January 1, 2018

Amendments to IFRS 4

Interactions between IFRS 4 and IFRS 9

January 1, 2018

The Group has not opted for the early adoption of IFRS 15, “Revenue from Contracts with Customers”, applicable

to the ﬁscal years beginning on or after January 1, 2018. The impact on the Group’s consolidated ﬁnancial statements

is currently being analyzed. The Group intends to apply the new standard at the date when it becomes mandatory.

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

The Group has not opted for the early adoption of IFRS 16, “Leases”, applicable to fiscal years beginning on or after January 1, 2019. A survey of leases identified the elements calling for particular attention. The Terminal

division has very few leases. They basically involve the long-term port concessions, which result in variable lease payments. Distribution and Support and Services each generate a high volume of contracts: delivery truck fleet, gas station leases,

When I was little…

I wanted to be a doctor, specifically a psychiatrist. I wanted to soothe souls, to help my patients love themselves and be happy. I wanted a job that was useful to others. Today, in the Group…

Well I don’t take apart and try to understand the human soul, but I do pore over and attempt to understand international accounting standards for their application in the Group. I try to get everyone to accept and like them. And who knows – maybe reading financial statements can make some people happy! Rubis’ Managing Partners:

Daring is the first adjective that comes to mind, I don’t think I need to explain why… Second, I’d say they are receptive, to people, ideas, and markets. Anne Zentar, Corporate Consolidation and Accounting Director, Rubis

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head ofﬁces, etc. as well as vessel leasing for trading activities. The Group intends to apply the new standard at the date when it becomes mandatory.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Note 3. Scope of consolidation Accounting policies Starting January 1, 2014 the Group has applied the new standards regarding scope of consolidation (IFRS 10, 11, 12 and amended IAS 28). Joint operations are accounted for according to the percentage interest held by the Group in the assets and liabilities of each joint operation. The Group accounts for its joint ventures by the equity method.

3.1

SCOPE OF CONSOLIDATION AS OF DECEMBER 31, 2016

The consolidated ﬁnancial statements for the year ended December 31, 2016 include the Rubis ﬁnancial statements and those of its subsidiaries listed in the table below. 12/31/2016 % Control

12/31/2015 % Control

12/31/2016 % Interest

12/31/2015 % Interest

105, av. Raymond Poincaré 75116 Paris SIREN: 784 393 530

Parent

Coparef

105, av. Raymond Poincaré 75116 Paris SIREN: 309 265 965

100.00%

Vitogaz France

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 323 069 112

100.00%

Rubis Terminal

33, av. de Wagram 75017 Paris SIREN: 775 686 405

99.44%

99.39%

99.44%

99.39%

CPA

33, av. de Wagram 75017 Paris SIREN: 789 034 915

100.00%

99.44%

99.39%

Stockbrest

Z.I. Portuaire St Marc 29200 Brest SIREN: 394 942 940

100.00%

99.44%

99.39%

Société du Dépôt de St Priest

16, rue des Pétroles 69800 Saint Priest SIREN: 399 087 220

100.00%

99.44%

99.38%

Société des Pipelines de Strasbourg

33, av. de Wagram 75017 Paris SIREN: 648 501 260

62.50%

32.60%

32.58%

Société Européenne de Stockage

28, rue de Rouen 67000 Strasbourg-Robertsau SIREN: 304 575 194

52.45%

52.16%

52.13%

Dépôt Pétrolier de La Corse

33, av. de Wagram 75017 Paris SIREN: 652 050 659

53.50%

53.23%

53.20%

Wagram Terminal

33, av. de Wagram 75017 Paris SIREN: 509 398 749

77.09%

76.66%

76.62%

Rubis Terminal BV

Welplaatweg 26 3197 KS Botlek-Rotterdam the Netherlands

100.00%

99.44%

99.39%

ITC Rubis Terminal Antwerp

Blikken, Haven 1662 B-9130 Beveren (Doel) Belgium

50.00%

49.72%

49.69%

JV (EM)

Rubis Med Energy BV

Prins Bernhardplein 200 1097 JB Amsterdam the Netherlands

50.00%

49.72%

49.69%

JV (EM)

Delta Rubis Petrol Ticaret ve Sanayi A.Ş.

Ayazma Caddesi Papirüs Plaza No. 37 Kat:12 34406 Kağıthane – Istanbul Turkey

50.00%

49.72%

49.69%

JV (EM)

Rubis Énergie

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 552 048 811

100.00%

Name

Registered ofﬁce

Rubis

Consolidation method

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187

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

188

12/31/2016 % Control

12/31/2015 % Control

12/31/2016 % Interest

12/31/2015 % Interest

Consolidation method

100.00%

35.00%

100.00%

20.94%

100.00%

Name

Registered ofﬁce

Sicogaz

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 672 026 523

Sigalnor

Route du Hoc 76700 Gonfreville l’Orcher SIREN: 353 646 250

Starogaz

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 418 358 388

Norgal

Route de la Chimie 76700 Gonfreville l’Orcher SIREN: 777 344 623

Frangaz

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 491 422 127

ViTO Corse

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 518 094 784

Rubis Restauration et Services

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 793 835 430

Vitogaz Switzerland

A Bugeon CH – 2087 Cornaux Switzerland

Multigas

Route de l’industrie CH-1564 Domdidier Switzerland

Propagaz

Bremblens (VD) Switzerland

100.00%

Rubis Energia Portugal

Lagoas Park Ediﬁcio 11, Piso 1, 2740 270 Porto Salvo Oeiras Portugal

100.00%

Rubis II Distribuição Portugal S.A.

Lagoas Park Ediﬁcio 11, Piso 1, 2740 270 Porto Salvo Oeiras Portugal

Vitogas España

Avda. Baix Llobregat 1-3, 2A Poligono Industrial Màs Blau II 08820 El Prat de Llobregat Barcelona Spain

Sodigas

Lagoas Park Ediﬁcio 11, Piso 1, 2740 270 Porto Salvo Oeiras Portugal

100.00%

Fuel Supplies Channel Islands Ltd

PO Box 85 Bulwer Avenue, St Sampson Guernsey GY1 3EB Channel Islands

100.00%

La Collette Terminal Ltd

La Collette Saint Helier Jersey JE1 0FS Channel Islands

100.00%

St Sampson Terminal Ltd

Bulwer Avenue, St Sampson Guernsey GY1 3EB Channel Islands

100.00%

Vitogaz Maroc

Immeuble n°7 Ghandi Mall Boulevard Ghandi 20380 Casablanca Morocco

100.00%

Lasfargaz

Immeuble n°7 Ghandi Mall Boulevard Ghandi 20380 Casablanca Morocco

82.89%

76.17%

82.89%

76.17%

Kelsey Gas Ltd

c/o Interface International Ltd 9th Floor Standard Chartered Tower, 19 Cybercity Ebene Republic of Mauritius

100.00%

Vitogaz Madagascar

122, rue Rainandriamampandry Faravohitra – BP 3984 Antananarivo 101 Madagascar

100.00%

RUBIS /// 2016 REGISTRATION DOCUMENT

100.00%

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

12/31/2016 % Control

12/31/2015 % Control

12/31/2016 % Interest

12/31/2015 % Interest

Consolidation method

c/o Interface International Ltd 9th Floor Standard Chartered Tower, 19 Cybercity Ebene Republic of Mauritius

100.00%

Vitogaz Comores

Voidjou BP 2562 Moroni Union of the Comoros Islands

100.00%

Gazel

122, rue Rainandriamampandry Faravohitra BP 3984 – Antananarivo 101 Madagascar

49.00%

Rubis Antilles Guyane

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 542 095 591

100.00%

Société Industrielle de Gaz et de Lubriﬁants

Voie principale ZI de Jarry 97122 Baie – Mahaut Guadeloupe SIREN: 344 959 937

100.00%

Stocabu

L’avenir du Morne Caruel Route des Abymes 97139 Abymes Guadeloupe SIREN: 388 112 054

50.00%

Société Anonyme de la Rafﬁnerie des Antilles

California 97232 Lamentin Martinique SIREN: 692 014 962

71.00%

Société Antillaise des Pétroles Rubis

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 303 159 875

100.00%

Rubis Guyane Française

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 351 571 526

100.00%

Rubis Caraïbes Françaises

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 428 742 498

100.00%

Rubis Energy Bermuda Ltd

2, Ferry Road Saint Georges’s GE 01 Bermuda

100.00%

Rubis Eastern Caribbean SRL

4th Floor, International Trading Centre Warrens St. Michael Barbados

100.00%

Rubis Caribbean Holdings Inc.

4th Floor, International Trading Centre Warrens St. Michael Barbados

100.00%

Rubis West Indies Ltd

10 Finsbury Square London EC2A 1AF United Kingdom

100.00%

Rubis Guyana Inc.

Ramsburg, Providence East Bank Demerara, Guyana

100.00%

Rubis Bahamas Ltd

H&J Corporate Services Ocean center, Montague Foreshore, East Bay Street PO Box SS 19084 Nassau The Bahamas

100.00%

Rubis Cayman Islands Ltd

H&J Corporate Services Cayman Ltd PO Box 866, 5th Floor Anderson Square, George Town, Grand Cayman KY1-1103 Cayman Islands

100.00%

Rubis Turks & Caicos Ltd

Caribbean Management Services Ltd c/o Misick & Stanbrook PO Box 127, Richmond House Annex, Leeward Highway, Providentiales, Turks and Caicos Islands

100.00%

Rubis Energy Jamaica Ltd

236 Windward Road Rockfort, Kingston 2 in the Parish of Kingston Jamaica

100.00%

Name

Registered ofﬁce

Eccleston Co Ltd

2016 REGISTRATION DOCUMENT /// RUBIS

189

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

190

12/31/2016 % Control

12/31/2015 % Control

12/31/2016 % Interest

12/31/2015 % Interest

Consolidation method

Gate 5, Hibiscus Road Alrode 1451 Gauteng South Africa

60.00%

100.00%

60.00%

100.00%

Easigas Botswana (Pty) Ltd

Acumen Park, Plot 50370, Fairground Ofﬁce Park, PO Box 1157, Gaborone Botswana

60.00%

100.00%

60.00%

100.00%

Easigas Swaziland (Pty) Ltd

PO Box 24 Mbabane H100 Swaziland 7441

60.00%

100.00%

60.00%

100.00%

Easigas Lesotho (Pty) Ltd

2nd Floor, Metropolitan Life Building Kingsway PO BOX 1176 Maseru Lesotho

60.00%

100.00%

60.00%

100.00%

European Railroad Established Services

Schaliënstraat 5 2000 Antwerpen Belgium

100.00%

75.00%

100.00%

75.00%

Maritec NV

Schaliënstraat 5 2000 Antwerpen Belgium

100.00%

75.00%

100.00%

75.00%

De Rode Beuk NV

Schaliënstraat 5 2000 Antwerpen Belgium

100.00%

75.00%

100.00%

75.00%

Starolux S.A (merged into Rubis Énergie)

Vega Center 75 Parc des Activités L-8308 Capellen Grand Duchy of Luxembourg

Ringardas Nigeria Ltd

49 Mamman Nasir Street Asokoro Abuja Nigeria

100.00%

75.00%

100.00%

75.00%

Marbach Global Company Ltd

49 Mamman Nasir Street Asokoro Abuja Nigeria

100.00%

75.00%

100.00%

75.00%

Zimrich Trading Company Nigeria Ltd

49 Mamman Nasir Street Asokoro Abuja Nigeria

100.00%

75.00%

100.00%

75.00%

Startac Global Forwarding Ltd

49 Mamman Nasir Street Asokoro Abuja Nigeria

100.00%

75.00%

100.00%

75.00%

European Rail Road Established Services (Senegal) SA

Zone des Hydrocarbures Port Autonome de Dakar Mole 8 BP 844 – Dakar Senegal

100.00%

75.00%

100.00%

75.00%

European Rail Road Established Services Togo SA

Zone Industrielle du Port Autonome de Lomé Route C4 – BP 9124 Lomé Togo

100.00%

75.00%

100.00%

75.00%

REC Bitumen SRL

4th Floor International Trading Centre Warrens Saint Michael Barbados

100.00%

75.00%

100.00%

75.00%

Dora Mar NV

Dianastraat 4 Curacao Netherlands Antilles

100.00%

75.00%

100.00%

75.00%

Briska Shipping NV

Van Engelenweg 23 Curacao Netherlands Antilles

100.00%

75.00%

100.00%

75.00%

Pickett Shipping Corp.

Via España n°122 Torre Delta Piso 14 Apartado 0823-05658 Panama Republic of Panama

100.00%

75.00%

100.00%

75.00%

Blue Round Shipping Corp.

Via España n°122 Torre Delta Piso 14 Apartado 0823-05658 Panama Republic of Panama

100.00%

75.00%

100.00%

75.00%

Saunscape International Inc.

Via España n°122 Torre Delta Piso 14 Apartado 0823-05658 Panama Republic of Panama

100.00%

75.00%

100.00%

75.00%

Société Réunionnaise de Produits Pétroliers

Tour Franklin 100, terrasse Boieldieu 92800 Puteaux SIREN: 310 837 190

100.00%

Name

Registered ofﬁce

Easigas (Pty) Ltd

RUBIS /// 2016 REGISTRATION DOCUMENT

75.00%

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

12/31/2016 % Control

12/31/2015 % Control

12/31/2016 % Interest

12/31/2015 % Interest

Consolidation method

Via España n°122 Torre Delta Piso 14 Apartado 0823-05658 Panama Republic of Panama

100.00%

75.00%

100.00%

75.00%

Biskra Shipping SA

Via España n°122 Torre Delta Piso 14 Apartado 0823-05658 Panama Republic of Panama

100.00%

75.00%

100.00%

75.00%

Woodbar CO Ltd

c/o Interface International Ltd 9th Floor Standard Chartered Tower, 19 Cybercity Ebene Republic of Mauritius

85.00%

Rubis Énergie Djibouti

Avenue Georges Pompidou BP 153 Djibouti Republic of Djibouti

85.00%

Sinders Limited

2, Ferry Road Saint Georges’s GE 01 Bermuda

100.00%

Bermuda Gas & Utility Ltd

2, Ferry Road Saint Georges’s GE 01 Bermuda

100.00%

Name

Registered ofﬁce

Maroni Shipping SA

FC: full consolidation. JO: joint operations. JV: joint venture (equity method). EM: equity method.

Rubis Antilles Guyane holds a minority stake in 5 EIGs located in the French Antilles; these companies’ accounts, which are not signiﬁcant, are not consolidated. Likewise, Rubis Energia Portugal held non-material and unconsolidated equity investments in 2016.

3.2 CHANGES IN THE SCOPE OF CONSOLIDATION Only the most significant changes are set out below. Hence the acquisition of Sodigaz by Rubis Energia Portugal or the acquisition of non-controlling interests in Rubis Terminal and Lasfargaz are not detailed below.

3.2.1 Acquisition of the residual 25% of the Eres Group As explained in note 3.2.3.1 “Acquisition of the Eres Group” of the 2015 Registration Document, Rubis acquired 75% of the Eres Group, a leading independent player in the supply, transport, logistics and distribution of bitumen in West Africa, in early June 2015. The takeover

occurred during the second half of 2015, and consolidation followed as of December 31, 2015. The key features of this acquisition are summarized below. The initial agreement provided for the immediate acquisition of 75% of the share capital, with an earn-out payment and the acquisition of the remaining 25% after a period of 3 years. The earn-out payment was calculated on the basis of the earnings over the years 2015 to 2017. In accordance with the applicable accounting standards, this contingent liability was recognized as of the control date (financial statements for the year ended December 31, 2015) at the best estimate of its value. The acquisition of the remaining 25% was to be indexed on past results. This (reciprocal) commitment to buy (and sell) the residual 25% was recorded as a liability in the Group’s financial statements at its best estimate, as of the takeover date (financial statements for the year ended December 31, 2015). During the first half of 2016, the noncontrolling interest decided to divest

earlier than expected in order to devote itself to its new activities. In mid-April 2016, the Group acquired the residual 25%, after deduction of installments in the amount of US$31 million paid in 2015 at the time of the initial transaction (see note 3.2.3.1 “Acquisition of the Eres Group” of the 2015 Registration Document), against a payment representing final settlement, and thus relinquishing the earn-out payment recognized at the time of takeover. The purchase price has been adjusted against goodwill. As of December 31, 2016 after accounting for this adjustment and various revisions of the opening balance sheet, goodwill ﬁnally stood at €146.5 million. Similarly, the debt relating to the residual 25%, all changes in which are to be recognized in equity (see note 3.2.3.1 “Acquisition of the Eres Group” of the 2015 Registration Document), was canceled through shareholders’ equity. This transaction had no impact on control of the company, and as such the consolidation method. These businesses have been fully consolidated since takeover.

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

3.2.2 Consolidation of non-controlling interests in Southern Africa On January 4, 2016, Easigas (a whollyowned Group subsidiary) and Reatile Gaz signed an agreement to merge their LPG businesses in Southern Africa. Easigas distributes LPG in South Africa, Botswana, Lesotho and Swaziland. Reatile Gaz, which operates in LPG in South Africa and exports to Mozambique and Zimbabwe, is 55% owned by the Reatile Group and 45% owned by Engen Petroleum Ltd. The Reatile Group operates in different segments of the Southern Africa energy market. The merged entity, 60% owned by Rubis and 40% by Reatile Gaz, will cover all of Southern Africa and benefit from scale advantages: increased and permanent access to LPG resources enabling it to serve its customers better through the combined infrastructures of the 2 groups. The combination has also enabled the Group to play a part in the transformation policy pursued by the South African government over the last 20 years (employment and empowerment of historically disadvantaged populations), a key factor for a Group that aims to take a leading role in the development of the energy sector in South Africa.

192

RUBIS /// 2016 REGISTRATION DOCUMENT

The deal was completed in 2 steps: The Reatile Group made a partial asset contribution in exchange for Easigas stock. Additionally, to reach 40% ownership by the non-controlling interests, Rubis Énergie sold shares of Easigas stock.

The fair values of the net assets acquired are summarized below: Contribution as of the date of inclusion in the scope Goodwill Fixed assets

As the transaction was performed with a non-controlling investor and did not entail the loss of control for the Group, it was recognized in full in shareholders’ equity. The overall impact of the transaction on the Group’s shareholders’ equity is not material.

Inventories

3.2.3 Acquisition of Bermuda Gas

Trade and other payables

In April 2016, Rubis signed an agreement with the Ascendant Limited Group, parent company of Bermuda Electric Light Company Limited (BELCO), the sole supplier of electricity in Bermuda, to acquire Bermuda Gas & Utility Company Ltd. Bermuda Gas is Bermuda’s leading LPG distributor, selling approximately 5,000 tonnes annually, both bottled and bulk. Rubis’ unique position in terms of import logistics on the island means that it has long been Bermuda Gas’s supplier. The transaction extends Rubis’ scope to cover the entire LPG distribution chain, from importing to storage and retail sales, which is a key element of Rubis’ strategy.

(in thousands of euros)

Trade and other receivables Cash and cash equivalents

13,762 3,929 256 1,040 876

TOTAL ASSETS

19,863

Price paid by the Group

15,582

Provisions for pensions and other employee beneﬁt obligations TOTAL LIABILITIES

3,857 424 19,863

The new subsidiary has made a positive contribution to Group earnings since April 30, 2016 when it entered the Group structure as a fully consolidated company.

3.2.4 Sale of Multigas In December 2016, af ter making a strategic review of its assets, Rubis decided to sell Multigas, a distributor of ammonia, specialty gases and LPG from its facilities in Switzerland. Since the trend towards consolidation in this sector that was anticipated when Multigas was acquired did not actually come to pass, Rubis finally opted to dispose of this business.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Note 4. Notes to the balance sheet 4.1

PROPERTY, PLANT AND EQUIPMENT

Accounting policies The gross amount of property, plant and equipment corresponds to its acquisition cost. Maintenance and repair costs are recorded as expenses as soon as they are incurred, except for those, posted as fixed assets, incurred to extend the useful life of the property. Fixed assets financed through finance leases are presented as assets at the discounted value of future payments or at the market value, if lower. The corresponding liability is recorded as borrowings. These fixed assets are depreciated according to the method and useful lives described below. Depreciation is calculated according to the straight-line method for the estimated useful life of the various categories of fixed assets, as follows: Duration Buildings

10 to 40 years

Technical facilities

10 to 20 years

Equipment and tools Transportation equipment Facilities and ﬁxtures Ofﬁce equipment and furniture

5 to 30 years 4 to 5 years 10 years 5 to 10 years

Borrowing costs are included in fixed asset costs when significant. Property acquired under finance leases is capitalized when, according to the terms of the lease, substantially all the risks and benefits inherent in owning the property are transferred to the Group. The criteria used to assess these contracts are primarily based on:

• the ratio between the term of the asset lease and the assets’ lifetime; • total future payments vs. the fair value of the financed asset; • whether ownership is transferred at the end of the lease; • whether there is a preferential purchase option; • the specific nature of the leased asset. Assets held under finance leases are depreciated over their useful lives or over the term of the corresponding lease, if shorter. Tangible fixed assets are given an impairment test whenever events or changes in circumstances indicate that their book values may not be recoverable.

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Gross value (in thousands of euros) Other property, plant and equipment

Machinery and equipment and tools Land and buildings TOTAL

Depreciation (in thousands of euros) Other property, plant and equipment Facilities and equipment Land and buildings TOTAL NET VALUE

(8,088)

(138,029)

2,172

237,493

(2)

252

92,242

(5)

(54,282)

312

166,648

(1,638)

50,149

(17,621)

177,098

2,516

1,745,301

(2,935)

8,284

(3,737)

15,176

(1,703)

612,535

(346)

163,746

(29,451)

(37)

3,295

2,762,229

Acquisitions

Decreases

364,290

4,322

12,826

128,476

(95)

1,534,797 597,450 2,625,022

245

12/31/2015

Change in scope

Increases

Decreases

Reclassiﬁcations

Foreign exchange differences

(201,302)

531

(13,201)

7,261

84,663

2,447

(119,601)

(1,004,392)

3,388

(80,143)

15,770

(86,180)

(107)

(1,151,664)

12/31/2016

(286,168)

2,690

(19,856)

3,064

1,463

183

(298,624)

(1,491,862)

6,609

(113,200)

26,095

(54)

2,523

(1,569,889)

1,133,160

6,263

50,546

(3,356)

(91)

5,818

1,192,340

The main changes in scope are as follows:

• the consolidation of Reatile’s activities in Southern Africa in the gross amount of €8 million;

• the acquisition of Bermuda Gas for €6.6 million in gross amount

4.2

12/31/2016

12/31/2015

Prepayments and down payments on property, plant and equipment Assets in progress

Reclassiﬁcations

Foreign exchange differences

Change in scope

and €2.6 million in accumulated depreciation;

• the adjustment to the fair value of the assets of Société Réunionnaise de Produits Pétroliers (SRPP) in the amount of -€1.1 million gross and -€0.9 million of depreciation;

• the adjustment of the fair value of the assets of the Eres Group in the amount of €0.4 million in accumulated depreciation;

• the disposal of Multigas for €13.9 million in gross amount and €8.8 million in accumulated depreciation.

GOODWILL

Accounting policies Business combinations prior to January 1, 2010 Business combinations carried out prior to January 1, 2010 have been recognized according to IFRS 3 unrevised, applicable from that date. These combinations have not been restated, as revised IFRS 3 must be applied prospectively. On first consolidation of a wholly controlled company, the assets, liabilities and contingent liabilities have been valued at their fair value in accordance with IFRS requirements. Valuation discrepancies generated at that time have been recorded in the relevant asset and liability accounts, including the non-controlling interests’ share, rather than solely for the proportion of shares acquired. The difference between the acquisition cost and the acquirer’s share of the fair value of the identifiable net assets in the acquired company is recognized in goodwill if positive, and charged to income under “Other operating income and expenses” if negative (badwill). Business combinations subsequent to January 1, 2010 IFRS 3 revised and IAS 27 amended modified the accounting policies applicable to business combinations carried out after January 1, 2010. The main changes with an impact on the Group’s consolidated financial statements are:

• recognition of direct acquisition costs in expenses; • revaluation at fair value through proﬁt and loss of interests held prior to the controlling interest, in the case of an acquisition via successive securities purchases;

• the possibility of valuing non-controlling interests either at fair value or as a proportional share of identiﬁable net assets, on a case by case basis;

• recognition at fair value of earn-out payments on the takeover date, with any potential adjustments being recognized in proﬁt and loss if they take place beyond the assignment deadline.

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FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Adjustments of the price recorded on acquisitions made by the Group are recognized in cash flows from investing activities on the same basis as the initial price. In accordance with the acquisition method, on the date of takeover, the Group recognizes the identifiable assets acquired and liabilities assumed at fair value. It then has a maximum of 12 months with effect from the acquisition date to finalize recognition of the business combination in question. Beyond this deadline, adjustments of fair value of assets acquired and liabilities assumed are recognized directly in the income statement. Goodwill is determined as the difference between (i) the transferred counterpart (mainly the acquisition price and any earn-out payment excluding acquisition expenses) and the total non-controlling interests, and (ii) the fair value of assets acquired and liabilities assumed. When positive, this difference is recognized as an asset in the consolidated balance sheet or, when negative (badwill), under “Other operating income and expenses”. After the adoption of the revised IFRS 3, an option exists for the measurement of non-controlling interests as of the acquisition date: either at the fraction they represent of the net assets acquired (the partial goodwill method) or at fair value (the full goodwill method). The option is available on a case-by-case basis for each business combination. The Group has opted for the partial goodwill method for the acquisitions carried out during the 2015 fiscal year (see note 3.2 “Changes in the scope of consolidation”). For the purposes of allocating the goodwill generated following the various business combinations and of implementing IFRS 8 “Operating segments”, Rubis has retained the following CGUs:

• bulk liquid Storage business (Europe); • petroleum products Distribution business (Europe); • petroleum products Distribution business (Africa); • petroleum products Distribution business (Caribbean); • Rubis Support and Services (Caribbean). This allocation was calculated based on the Group’s operational management structure and internal reporting system, enabling not only business oversight, but also monitoring of the return on capital employed, i.e. the level at which goodwill is monitored for internal management purposes. Impairment of fixed assets Goodwill and intangible assets with an indefinite useful life are subject to an impairment test at least once per year, or more frequently if there are indications of a loss in value, in accordance with the requirements of IAS 36 “Impairment of assets”. Annual tests are performed during the fourth quarter. The impairment test consists of comparing the asset’s net book value against its recoverable value, which is its fair value minus disposal costs or its value in use, whichever is higher. The value in use is obtained by adding the discounted values of anticipated cash flows generated from the use of the asset (or group of assets) and from its final disposal. For this purpose, fixed assets are grouped into Cash-Generating Units (CGUs). A CGU is a uniform set of assets (or group of assets) whose continued use generates cash inflows that are largely independent of cash inflows generated by other groups of assets. The fair value minus disposal costs corresponds to the amount that could be obtained from the disposal of the asset (or group of assets) under normal market conditions, minus the costs directly incurred to dispose of it. When the recoverable value is lower than the net book value of the asset (or group of assets), an impairment, corresponding to the difference, is recorded in the income statement and is charged primarily against goodwill. Impairments recorded in relation to goodwill are irreversible. During the fiscal year 2015, the Group created a new line of business following the acquisition of the Eres Group and the additional purchase of a 35.5% interest in the Sara refinery. The allocation of the Eres acquisition goodwill was finalized as of December 31, 2016, whereby goodwill was split between the various geographic zones and between the Distribution and Support and Services businesses. Similarly, a portion of the goodwill in Rubis Eastern Caribbean was re-allocated to the CGU Support and Services Caribbean. These changes are shown in the “Reallocation” column of the table below.

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195

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

The amount of goodwill per CGU as of December 31, 2016 is as follows:

(in thousands of euros)

12/31/2015 (reported)

Bulk liquid Storage business (Europe)

Adjustments in the allocation period Reallocation

Changes in 12/31/2015 consolidation scope (corrected)

Foreign exchange differences

12/31/2016

57,446

Petroleum products Distribution business (Europe)

248,187

(6,036)

(699)

241,452

Petroleum products Distribution business (Africa)

220,078

(52,978)

164,549

(2,447)

3,478

165,580

Petroleum products Distribution business (Caribbean)

245,533

(37,692)

225,663

Support and Services (Caribbean) GOODWILL

90,670 771,244

Adjustments in the allocation period refer primarily to:

• an adjustment to the goodwill from acquiring the Société Réunionnaise de Produits Pétroliers for €1.4 million;

• an adjustment to the goodwill in the Eres Group, reduced by €5.6 million (€3.9 million for Distribution Africa and €1.7 million for Support and Services.)

(2,551)

207,841

13,762

4,060

(1,693)

88,977

(7,342)

1,237

82,872

(4,244)

767,000

(2,063)

8,076

773,013

• the consolidation of Reatile’s activities in Southern Africa in the amount of €14.7 million;

• the acquisition of Bermuda Gas for €13.8 million;

• the sale of Multigas for €6 million. These items are described in note 3, “Changes in the scope of consolidation”.

The main changes in scope recorded during the year are as follows:

Impairment tests as of December 31, 2016

• the reduction in the goodwill of the Eres

As of December 31, 2016, Rubis had systematically tested all goodwill determined definitively on the date the tests were performed using the discounted future cash ﬂow method.

Group in the amount of €24.5 million af ter relinquishing the earn- out payment (see note 3.2.1);

57,446

Recoverable amounts are based on the value in use calculation. Value in use calculations are based on cash flow forecasts using the financial budgets approved by Management at year-end, covering a period of 3 years. The primary assumptions used in the calculation relate to trading volumes and market prices. Cash flows beyond the 3-year period are extrapolated at a growth rate of 1%. The discount rate used, based on the concept of Weighted Average Cost of Capital (WACC), reflects current market assessments of the time value of money, and the specific risks inherent in each CGU.

The following discount rates are used: 2016 rate

CGU

between 4.9 and 8.5%

3.9%

Petroleum products Distribution business (Europe)

between 4.8 and 6.9%

between 4.0 and 6.4%

Petroleum products Distribution business (Africa)

between 5.2 and 11.5%

between 7.2 and 10.0%

Petroleum products Distribution business (Caribbean)

between 5.2 and 11.2%

between 4.8 and 10.4%

Support and Services (Caribbean)

between 5.2 and 11.2%

N/A

These tests revealed no impairment as of December 31, 2016.

Sensitivity of impairment tests I m p a i r m e n t te s t s a re b a s e d o n assumptions used to determine the

196

2015 rate

Bulk liquid Storage business (Europe)

RUBIS /// 2016 REGISTRATION DOCUMENT

discount and perpetual growth rates, as well as sensitivity testing allowing for a +/1% variation in the perpetual growth rate and a +/-1% variation in the discount rate. A 1% increase in the discount rate, or a 1% decrease in the growth rate, would not

generate recoverable amounts for capital employed below net book value for the 5 CGUs mentioned above. Moreover, a 5% decrease in discounted future cash ﬂows would not change the results of the tests for the Group’s 5 CGUs.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.3

INTANGIBLE ASSETS

Accounting policies Intangible assets are accounted for at their acquisition cost. Intangible assets with a ﬁnite useful life are amortized according to the straight-line method for the periods corresponding to their expected useful lives and are subject to an impairment test whenever events or changes in circumstances indicate that their book values may not be recoverable. Other intangible assets mainly include concessions, patents and similar rights, and in particular Rubis Terminal’s port lease rights in the amount of €2,319 thousand. Rubis Terminal uses land for its operations under concession from the Independent Ports of Rouen and Dunkirk measuring a surface area of 203,146 m2. These rights were valued according to existing agreements. This intangible asset with an indeﬁnite useful life is subject to impairment testing in the same way as goodwill, as described in note 4.2.

Gross value (in thousands of euros)

12/31/2015

Port lease rights (Rubis Terminal)

2,319

Other concessions, patents and similar rights

17,785

Lease

Changes in consolidation scope

Acquisitions

Decreases

Reclassiﬁcations

Foreign exchange differences

12/31/2016 2,319

439

(345)

179

(141)

177

18,008

233

412

Other intangible assets

18,377

3,570

434

(65)

591

528

23,435

TOTAL

38,660

3,664

873

(410)

682

705

44,174

12/31/2015

Changes in consolidation scope

Increases

Decreases

Reclassiﬁcations

Foreign exchange differences

12/31/2016

Depreciation (in thousands of euros) Other concessions, patents and similar rights

(4,471)

(257)

122

(18)

(4,624)

Other intangible assets

(13,974)

(2,048)

(578)

(110)

(16,645)

Total

(18,445)

(2,305)

187

(578)

(128)

(21,269)

(1,432)

(223)

104

577

22,905

NET VALUE

20,215

3,664

Changes in the scope of consolidation result from the consolidation of Reatile activities in Southern Africa.

4.4

INTERESTS IN ASSOCIATES

Information about non-controlling interests, interests in joint operations and interests in joint ventures is given in notes 7 to 9.

When I was little…

I wanted to travel. Today, in the Group…

With the Rubis Group’s expansion, which I’ve been a part of for 20 years now, I’ve discovered new cultures and territories. My journeys have been both professional and geographic. Rubis’ Managing Partners:

Visionary, creative, measured, and open. Bruno Hayem, Chief Financial Ofﬁcer, Rubis Terminal

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

4.5

FINANCIAL ASSETS

Accounting policies Financial assets are recognized and measured in accordance with IAS 39 “Financial instruments: recognition and measurements”. Financial assets are recognized in the Group balance sheet when the Group is a party to the instrument’s contractual provisions. IAS 39 distinguishes between 4 categories of ﬁnancial assets, which are valued and recognized according to each category:

• financial assets held at fair value through profit and loss are those that are held for the purpose of trading in the short term; this category includes marketable securities that cannot be classified as “Cash and cash equivalents” and derivative instruments not classified as hedging instruments. They are measured at fair value at the closing date and changes in fair value are recognized through profit and loss for the period;

• loans and receivables issued correspond to ﬁnancial assets with ﬁxed or determinable payments, not listed on an active market; this category includes receivables from investments, other loans, and trade and other receivables. These assets are recognized at amortized cost, applying the effective interest rate method, if applicable;

• assets held to maturity are financial assets with fixed or determinable payments, with a fixed maturity date, that the entity expressly can and will hold until maturity; this category mainly concerns deposits and guarantees paid against operating leases. These assets are recognized at amortized cost;

• assets available for sale include financial assets not falling into any of the categories listed above, including equity interests in non-consolidated companies. These securities are initially recognized at fair value (usually their acquisition cost plus transaction costs). Changes in fair value of assets available for sale are recognized as items of other comprehensive income. In the event of a significant or prolonged decrease in the fair value below their acquisition price, an impairment is recorded in net income. The Group used the fair value hierarchy in IFRS 7 to determine the classification level of the financial assets:

• level 1: quoted prices in active markets for identical assets or liabilities; • level 2: use of data other than the quoted prices listed in level 1, which are directly observable for the assets or liabilities in question, either directly or indirectly;

• level 3: use of data relating to the asset or liability which are not based on observable market data. Measurement and recognition of derivative instruments The Group uses derivative financial instruments to manage its exposure to fluctuations in interest rates, foreign exchange rates and raw material prices. The Group’s hedging policy includes the use of swaps. It may also use caps, floors, and options. The derivative instruments used by the Group are valued at their fair value. Unless otherwise specified below, changes in the fair value of derivatives are always recorded in the income statement. Derivative instruments may be designated as hedging instruments in a fair value or future cash flow hedging relationship:

• a fair value hedge protects the Group against the risk of changes in the value of any asset or liability, resulting from foreign exchange rate ﬂuctuations;

• a future cash flow hedge protects the Group against changes in the value of future cash flows relating to existing or future assets or liabilities. The Group only applies cash flow hedges. Hedge accounting is applicable if:

• the hedging relationship is clearly defined and documented at the date it is set up; • the hedging relationship’s effectiveness is demonstrated from the outset and throughout its duration. As a consequence of the use of hedge accounting of cash flows, the effective portion of the change in fair value of the hedging instrument is recorded directly in other comprehensive income. The change in value of the ineffective portion is recorded in the income statement under “Other financial income and expenses”. The amounts recorded in other comprehensive income are recycled in the income statement during the periods when the hedged cash flows impact profit and loss.

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FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Breakdown of ﬁnancial assets by class (IFRS 7) and by category (IAS 39) (in thousands of euros)

Value on balance sheet

Fair value

12/31/2016

12/31/2015

12/31/2016

12/31/2015

FINANCIAL ASSETS HELD TO MATURITY

279

262

279

262

Bonds and negotiable debt securities

279

262

279

262

496,862

477,928

496,862

477,928

Long-term loans

51,066

75,113

51,066

75,113

Deposits and guarantees

39,948

36,505

39,948

36,505

381,595

342,398

381,595

342,398

LOANS AND RECEIVABLES Short-term loans

Trade and other receivables

24,253

23,912

24,253

23,912

FINANCIAL ASSETS AVAILABLE FOR SALE

Other

3,315

3,324

3,315

3,324

Equity interests

3,315

3,324

3,315

3,324

FINANCIAL ASSETS AT FAIR VALUE

3,172

(274)

3,172

(274)

Derivative instruments

3,172

(274)

3,172

(274)

833,652

786,456

833,652

786,456

1,337,280

1,267,696

1,337,280

1,267,696

Other

CASH AND CASH EQUIVALENTS FINANCIAL ASSETS

Fair value of financial instruments by level (IFRS 7) Equity interests and other available-forsale financial assets are considered to be level 3 (non-observable data), as the shares are not listed.

4.5.1

The fair value of derivative instruments is determined using valuation models based on observable data (level 2).

Cash and cash equivalents are detailed in note 4.5.5. They are classiﬁed as level 1, with the exception of term deposits in the amount of €241 million, which are considered as level 2.

Non-current financial assets

Other financial assets notably include equit y interes t s, other long -term receivables from investments, long-term

securities, long-term loans, long-term deposits and guarantees and long-

Gross value (in thousands of euros)

term marketable securities that are not considered cash or cash equivalents.

12/31/2016

Equity interests Other receivables from investments Long-term securities

12/31/2015

3,340

3,334

51,066

75,113

1,602

1,573

Loans, deposits and guarantees

37,968

36,040 116,060

TOTAL OTHER FINANCIAL ASSETS

93,976

Impairment

(1,378)

(1,376)

NET VALUE

92,598

114,684

Investments in non-controlled entities correspond mainly to:

• shares of the EIG held by Rubis Antilles Guyane;

• non-controlling interests held by Rubis Energia Portugal in 2 entities in Portugal. Other receivables from investments include the effects of earn-out clauses

inc lud e d in cer t ain t r an s ac tion s undertaken by the Group as well as the non-current prepayments and down payments paid during external growth transactions. €28.6 million of the change recorded during the year is attributable to installments paid in 2015 connection with the acquisition of the Eres Group as explained in note 3.2.1 “Acquisition of the residual 25% of the Eres Group”.

Loans, deposits and guarantees refer largely to a deposit of US$32.5 million made in 2014 to guarantee a bank loan in US dollars obtained by a subsidiary of Rubis Terminal. The changes recorded during the year are due to the variation in the euro/dollar exchange rate.

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

4.5.2 Other current financial assets Current ﬁnancial assets include the short• advances and deposits paid in order to term portion of the following assets:

• receivables from investments;

purchase securities;

• deferred expense;

• marketable securities that cannot be considered as cash or cash equivalents;

• hedging instruments at fair value.

• loans and deposits and guarantees; 12/31/2016

(in thousands of euros)

12/31/2015

Other receivables from investments Loans, deposits and guarantees

2,010

519

GROSS CURRENT FINANCIAL ASSETS

2,010

519

Impairment NET CURRENT FINANCIAL ASSETS

2,010

519

Fair value of ﬁnancial instruments

3,172

(274)

Other receivables – advances and deposits Prepaid expenses

14,061

14,874

CURRENT ASSETS

17,233

14,600

TOTAL OTHER CURRENT ASSETS

19,243

15,119

4.5.3 Other non-current assets Gross value (in thousands of euros)

1 to 5 years

More than 5 years

Uncalled share capital Other receivables (long-term portion)

173

Prepaid expenses (long-term portion)

149

TOTAL

149

173

Rubis’ Culture:

A solid and reliable family business. Steady, receptive management, and a well thought-out strategy. A business that has succeeded in making a place for itself without crushing the others. Rubis, a company that you’d like to belong to. And when you’re a service provider, you like the warm welcome and the fact that you’re a true partner and friend, it’s more than appreciated! Rubis’ Managing Partners:

Humane, accessible, kind, and visionary. Julie, communications agency

200

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FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.5.4 Trade and other receivables (current operating assets) Accounting policies Trade receivables, generally due within a period of one year, are recognized and accounted for at the initial invoice amount less an allowance for impairment recorded as the amount deemed to be unrecoverable. Doubtful receivables are estimated when there is no longer any probability of recovering the entire receivable. Impaired receivables are recorded as losses when they are identiﬁed as such.

Trade and other receivables include the short-term portion of trade receivables and related accounts, employee receivables, government receivables, and other operating receivables. Gross value (in thousands of euros)

12/31/2016

12/31/2015

271,773

250,983

Trade and other receivables Employee receivables

489

548

Government receivables

50,735

49,477

Other operating receivables

91,410

76,002

414,407

377,010

Deferred revenue TOTAL

Other operating receivables include €71 million (€56 million in 2015) of current accounts for joint ventures.

12/31/2015

Changes in consolidation scope

Allowances

Reversals

Reclassiﬁcations

12/31/2016

Trade and other receivables

32,084

295

3,590

(6,232)

(1,864)

27,873

Other operating receivables

2,528

(572)

192

(701)

3,492

4,939

34,612

(277)

3,782

(6,933)

1,628

32,812

Impairment (in thousands of euros)

TOTAL

The main changes in scope are as follows:

• the acquisition of Bermuda Gas for €0.5 million; • the adjustment of the fair value of the assets of the Eres Group in the amount of -€0.7 million. Reconciliation of change in working capital with the statement of cash flows Net carrying amount as of 12/31/2016

381,595

Net carrying amount as of 12/31/2015

342,398

CHANGE IN TRADE AND OTHER RECEIVABLES ON THE BALANCE SHEET

(39,197)

(-) impact of change in the scope of consolidation (-) impact of exchange differences (-) impact of reclassiﬁcations (-) impact of change in called but unpaid capital (in ﬁnancing) (-) impact of change in receivables on disposal of assets (in investment) (+) impact of change in other receivables (long-term portion) CHANGE IN TRADE AND OTHER RECEIVABLES ON THE STATEMENT OF CASH FLOWS

3,524 645 (8,020) 40 1,336 709 (40,963)

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201

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

4.5.5 Cash and cash equivalents Accounting policies Cash and cash equivalents include current bank accounts and UCITS units which can be mobilized or sold in the very short term (less than 3 months) and which present no signiﬁcant risk of change in value, according to the criteria stipulated in IAS 7. These assets are carried at fair value.

(in thousands of euros) OEIC Equities Other funds Interest receivable

12/31/2016

12/31/2015

21,922

64,025

117,528

81,919

1,484

2,207

Cash

692,716

638,303

TOTAL

833,652

786,456

Rubis holds 94% of the marketable securities.

Equity risk The Group is not exposed to equity risk, as it does not hold a large equity portfolio.

4.5.6 Credit risk Customer concentration risk Revenue generated with the Group’s largest customer, the top 5 customers and the top 10 customers over the past 2 ﬁscal years. 2016

2015

Top customer

11%

10%

Top 5 customers

19%

17%

Top 10 customers

22%

21%

The Group’s maximal credit risk exposure from trade receivables at the closing date is as follows for each geographic zone: Net book value 12/31/2016

12/31/2015

Europe

91,490

76,358

Caribbean

99,790

96,360

Africa

52,620

46,181

243,900

218,899

(in thousands of euros)

TOTAL

The age of the current assets at the closing date breaks down as follows: Assets due unimpaired (in thousands of euros) Trade and other receivables Income tax receivables Other current assets TOTAL

202

RUBIS /// 2016 REGISTRATION DOCUMENT

Book value

Impairment

Net book value

414,407

32,812

381,595

283,028

85,647

9,870

8,398

9,870 19,243 443,520

32,812

Assets not yet due

Under 6 months

6 months to 1 year 6,627

More than 1 year 6,293 1,457

19,243

18,991

410,708

310,417

85,757

6,714

7,820

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.6

DEFERRED TAX ASSETS/LIABILITIES

Accounting policies Deferred tax assets and liabilities are recognized for all temporary differences between the book value and the tax basis, using the liability method. Deferred tax assets are recognized for all deductible temporary differences, carry forwards of unused tax losses and unused tax credits, subject to the probability of taxable proﬁt becoming available in the foreseeable future, on which these temporary deductible differences and carry forwards of unused tax losses, and unused tax credits can be used. Deferred tax assets and liabilities are measured at the expected tax rate for the period when the asset is realized or the liability is settled, based on tax rates and laws enacted by the closing date. Deferred tax assets and liabilities are not discounted.

Deferred tax is recorded as the difference between the book value and the tax basis of assets and liabilities. Deferred tax assets and liabilities break down as follows: (in thousands of euros) Depreciation of ﬁxed assets

12/31/2016

12/31/2015

(65,950)

(78,067)

Loss carry forwards

4,718

8,443

Temporary differences

7,171

5,405

Provisions for risks

2,830

2,070

Provisions for environmental costs

3,160

4,105

Financial instruments Pension commitments Other NET DEFERRED TAXES Deferred tax assets Deferred tax liabilities NET DEFERRED TAXES

Deferred taxes representing tax loss carry forwards concern mainly the tax loss carry forwards of the Frangaz, Rubis Energy Jamaica Ltd and Rubis Terminal BV entities. The losses of Rubis Terminal BV relate primarily to the use of accelerated depreciation for tax purposes. The deferred tax recorded on tax loss carry forwards of Frangaz concern the loss carry forwards generated before its inclusion in Rubis’ tax scope. These losses are deducted from the net proﬁts generated by Frangaz. The business forecasts updated at year-end justify the probability of deferred tax assets being applied in the medium term. Deferred taxes relating to ﬁnancial instruments basically comprise the deferred tax pertaining to the fair

684

1,605

9,854

10,663

459

1,397

(37,076)

(44,379)

12,521

7,011

(49,597)

(51,390)

(37,076)

(44,379)

value of hedging instruments for Rubis Terminal and Rubis Énergie.

rate differential generated income of €4.8 million.

Deferred taxes on fixed assets mainly comprise:

Deferred tax assets and liabilities are offset by entity or by tax consolidation group. Only the deferred tax asset or liability balance by entity or by tax consolidation group appears on the balance sheet. There is only one tax consolidation scope within the Group, that of the parent company, Rubis, which comprises the following entities: Rubis Terminal, Vitogaz France, Rubis Énergie, Coparef, ViTO Corse, Frangaz, Starogaz, Sicogaz, Rubis Antilles Guyane, SIGL, Rubis Caraïbes Françaises, Rubis Guyane Française, Société Antillaise des Pétroles Rubis, Rubis Restauration et Services and Société Réunionnaise de Produits Pétroliers (SRPP).

• t h e c a n c e l l a t i o n o f e xc e s s t a x depreciation over normal depreciation;

• the standardization of depreciation rates for machinery;

• the difference between the consolidated value and the tax value of certain assets. With respect to French entities, deferred taxes that will probably be applied in 2019 or 2020 were measured inclusive of the expected reduction in tax rate provided by the Finance Act of 2017. This

2016 REGISTRATION DOCUMENT /// RUBIS

203

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

4.7

INVENTORIES

Accounting policies Inventories are valued at cost or net realizable value, whichever is lower. Inventory purchase cost is determined according to weighted average cost for Rubis Énergie and according to the First-In First-Out (FIFO) method for Rubis Terminal. Borrowing costs are not included in inventory cost. The net realizable value is the estimated sale price in the normal course of business minus estimated costs necessary to complete the sale. Impairment is recognized when the probable realizable value is lower than the net book value.

Gross value (in thousands of euros)

12/31/2016

12/31/2015

Inventories of raw materials and supplies

76,523

52,024

Inventories of ﬁnished and semi-ﬁnished products

65,533

72,690

Inventories of merchandise

114,325

92,617

TOTAL

256,381

217,331

12/31/2015

Changes in consolidation scope

Allowances

Inventories of raw materials and supplies

7,213

Inventories of ﬁnished and semi-ﬁnished products

1,121

Inventories of merchandise

1,928 10,262

Impairment (in thousands of euros)

TOTAL

Reversals

12/31/2016

7,849

(6,281)

8,873

279

(1,121)

279

(125)

270

(1,459)

614

(33)

8,398

(8,861)

9,766

The main changes in scope are primarily the adjustment of the fair value of the SRPP assets acquired and the disposal of Multigas. Reconciliation of change in working capital with the statement of cash flows Net carrying amount as of 12/31/2016

207,069

CHANGE IN INVENTORIES AND WORK IN PROGRESS ON THE BALANCE SHEET

(39,546)

(-) impact of change in the scope of consolidation (-) impact of exchange differences CHANGE IN INVENTORIES AND WORK IN PROGRESS IN THE STATEMENT OF CASH FLOWS

204

246,615

Net carrying amount as of 12/31/2015

RUBIS /// 2016 REGISTRATION DOCUMENT

294 (966) (40,218)

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.8

SHAREHOLDERS’ EQUITY

As of December 31, 2016, Rubis’ share capital was composed of 45,454,888 fully paid-up shares with a par value of €2.50 each, i.e. a total amount of €113,637 thousand. The various transactions impacting on the share capital in the period are listed in the table below. Number of shares

Share capital (in thousands of euros)

Share premium (in thousands of euros)

43,216,952

108,042

962,398

1,644,725

4,113

93,189

287,672

719

9,799

Bonus shares

11,395

(28)

Company savings plan

64,644

162

3,396

229,500

574

16,294

AS OF JANUARY 1, 2016 Payment of the dividend in shares Exercise of stock options

Equity line (Crédit Agricole CIB) Capital increase Capital increase expenses

(238)

Legal reserve allocation

(560)

AS OF DECEMBER 31, 2016

In July 2013, the Group signed an equity line agreement with BNP Paribas and Crédit Agricole CIB for a period of 40 months, capped at 2,440,000 shares. The subscription price is based on the

45,454,888

weighted average share price (over the 3 days prior to issue) less a 4% discount.

113,637

1,084,251

As of December 31, 2016, Rubis held 14,391 treasury shares.

Since its signing, this agreement has resulted in the issue during 2016 of 229,500 new shares.

Reconciliation of the capital increase with the statement of cash flows Increase in the share capital

5,595

Increase in issue premiums

121,853

Reintegration of the allocation to the legal reserve

560

Change in receivables related to called but unpaid capital

(41)

CAPITAL INCREASE IN THE STATEMENT OF CASH FLOWS

127,967

Rubis’ Culture:

It seems to me that Rubis has understood that maintaining an effective culture, is more important than strategy. Rubis’ Managing Partners:

It seems that they are always having a lot of fun! … I often hear them laughing in the corridor, where they frequently have their discussions. Caroline, service provider

2016 REGISTRATION DOCUMENT /// RUBIS

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

4.9

STOCK OPTIONS AND BONUS SHARES

Accounting policies IFRS 2 provides for payroll expense to be recognized for services remunerated by beneﬁts granted to employees in the form of share-based payments. These services are carried at fair value of the instruments awarded. All the plans granted by the Group are in the form of instruments settled in shares; the payroll expense is offset in shareholders’ equity. Stock option plans Stock options are granted to certain members of the Rubis Group personnel. These options are valued at fair value on the grant date, using a binomial model (Cox Ross Rubinstein). This model takes into account the plan’s characteristics (exercise price, exercise period) and market data at the time of attribution (risk-free rate, share price, volatility, expected dividends). This fair value on the grant date is recognized as payroll expenses, on a straight-line basis over the vesting period, offset against shareholders’ equity. Free share awards Free share plans are also granted to some members of the Rubis Group personnel. These free share awards are valued at fair value on the grant date, using a binomial model. The valuation is based, in particular, on the share price on the grant date, taking into account the absence of dividends during the vesting period. This fair value on the grant date is recognized as payroll expenses, on a straight-line basis over the vesting period, offset against shareholders’ equity. Preferred share awards Preferred share plans are also granted to some members of the Rubis Group personnel. These preferred share awards are valued at fair value on the grant date, using a binomial model. The valuation is based, in particular, on the share price on the grant date, taking into account the vesting period, the absence of dividends and conditions relating to the average annual overall rate of return (AAORR) of the Rubis share. This fair value on the grant date is recognized as payroll expenses, on a straight-line basis over the vesting period, offset against shareholders’ equity. Company savings plans The Group has set up several company savings plans for its employees. These plans provide employees with the possibility of subscribing to a reserved capital increase at a discounted share price. The plans comply with the conditions of application of share purchase plans (French National Accounting Council statement dated December 21, 2004). The fair value of each share is then estimated as corresponding to the variance between the share price on the plan grant date and the subscription price. The share price is nonetheless adjusted to take into account the unavailability of the share for 5 years, based on the variance between the risk-free rate on the grant date and the interest rate of an ordinary 5-year consumer loan. In the absence of vesting period, the payroll expense is recognized directly against shareholders’ equity. The expense corresponding to the Company contribution granted to employees is also recognized in the income statement under payroll expenses.

A €4,149 thousand charge for stock options, free shares, and company savings plans was recognized under “Payroll expenses” in 2016.

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FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Stock options as of December 31, 2016 Date of the Board of Management meeting April 28, 2011

Outstanding as of 01/01/2016

Rights issued

Rights exercised

Rights canceled

Outstanding as of 12/31/2016

13,095

(13,095)

July 9, 2012

460,410

(274,577)

185,833

TOTAL

473,505

(287,672)

185,833

Outstanding options Number of options

Expiration date 04/27/2016

38.33

July 9, 2012

185,833

07/08/2017

36.48

TOTAL

185,833

Date of the Board of Management meeting April 28, 2011

Exercise price (in euros)

Options eligible for exercise 185,833 185,833

Bonus shares Date of the Board of Management meeting

Outstanding as of 01/01/2016

July 9, 2012

3,093

July 9, 2013

11,395

Rights issued

Rights exercised

Rights canceled

Outstanding as of 12/31/2016 3,093

(11,395)

January 3, 2014

5,101

March 31, 2014

751

56,558

August 18, 2014 April 17, 2015 TOTAL

5,101

8,811

85,709

(11,395)

74,314

The vesting period for beneﬁciaries’ free shares is a minimum of 3 years from the date on which they are granted by the Board of Management. The conditions for granting free shares are set by the Board of Management.

Preferred shares Date of the Board of Management meeting September 2, 2015

Outstanding as of 01/01/2016 1,442

July 11, 2016 TOTAL

Rights issued

1,442

Rights exercised

Rights canceled

Outstanding as of 12/31/2016 1,442

1,932

3,374

Preferred shares will be converted into ordinary shares at the end of the retention or acquisition period based on the extent to which the set performance conditions have been achieved.

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207

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Valuation of stock option plans and free shares The risk-free interest rate used to calculate the value of these plans is the interest rate on Euro zone Government bonds with the same maturity as the options (source: IBoxx).

With respect to the early exercise of the options, the model assumes rational expectations on the part of options holders, who may exercise their options at any time throughout the exercise

period. The implied volatility used in the calculation is estimated on the basis of past volatility levels. The annual dividend rates used in the valuations are shown in the table below. Annual dividend rate

Date of the Board of Management meeting

Stock options

Bonus shares

April 28, 2011

3.7%

July 9, 2012

4.2%

July 9, 2013

January 3, 2014

4.1%

March 31, 2014

4.1%

August 18, 2014

4.1%

April 17, 2015

4.1%

September 2, 2015

3.9%

July 11, 2016

3.7%

Company savings plans – Valuation of company savings plans The lock-up rate was estimated at 1.05% for the 2016 plan (0.77% for the 2015 plan). The risk-free interest rate used to calculate the value of the company savings plans is

208

RUBIS /// 2016 REGISTRATION DOCUMENT

the interest rate on Euro zone Government bonds with the same maturity as the instruments valued (source: IBoxx). The discount related to the lock-up was

estimated based on the risk-free interest rate and the average borrowing rate over 5 years, i.e. respectively 0.12% and 1.05%.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.10 FINANCIAL LIABILITIES Accounting policies Financial liabilities are recognized and measured in accordance with IAS 39 “Financial instruments: recognition and measurement”. Financial liabilities are recognized in the Group balance sheet when the Group is a party to the instrument’s contractual provisions. IAS 39 distinguishes 2 categories of ﬁnancial liabilities, each subject to speciﬁc accounting treatment:

• ﬁnancial liabilities valued at amortized cost: these mainly include trade payables and borrowings applying the effective interest rate method, if applicable;

• financial liabilities valued at fair value through profit and loss, which only represent a very limited number of scenarios for the Group and do not have a significant impact on the financial statements. Measurement and recognition of derivative instruments The accounting policies used to measure and recognize derivative instruments are set forth in note 4.5.

Breakdown of ﬁnancial liabilities by class (IFRS 7) and by category (IAS 39) (in thousands of euros)

Value on balance sheet

Fair value

12/31/2016

12/31/2015

12/31/2016

12/31/2015

FINANCIAL LIABILITIES AT FAIR VALUE

4,597

3,800

4,597

3,800

Derivative instruments

4,597

3,800

4,597

3,800

FINANCIAL LIABILITIES AT AMORTIZED COST

1,508,502

1,609,733

1,508,502

1,609,733

Borrowings and ﬁnancial debt

1,020,740

1,038,310

1,020,740

1,038,310

102,967

95,095

102,967

95,095

3,847

122,287

3,847

122,287

355,243

330,497

355,243

330,497

7,343

7,366

7,343

7,366

18,362

16,178

18,362

16,178

Deposit/consignment Other non-current liabilities Trade and other payables Current tax liabilities Other current liabilities BANKS FINANCIAL LIABILITIES

40,598

84,848

40,598

84,848

1,553,697

1,698,381

1,553,697

1,698,381

The fair value of derivative instruments is determined using valuation models based on observable data (level 2).

4.10.1 Financial liabilities Financial debt is presented in the following table, which differentiates between non-current and current liabilities: Current (in thousands of euros)

12/31/2016

12/31/2015

Credit institution loans

219,704

166,368

Interest accrued not yet due on loans and bank overdrafts

1,893

1,949

40,189

84,481

678

227

262,464

253,025

Non-current (in thousands of euros)

12/31/2016

12/31/2015

Credit institution loans

782,463

850,791

Customer deposits on tanks

19,730

20,062

Customer deposits on cylinders

83,237

75,033

Other loans and similar liabilities

16,411

19,342

901,841

965,228

1,164,305

1,218,253

Bank overdrafts Other loans and similar liabilities TOTAL BORROWINGS AND SHORT-TERM BANK BORROWINGS (PORTION DUE IN LESS THAN ONE YEAR)

TOTAL BORROWINGS AND FINANCIAL DEBT TOTAL

2016 REGISTRATION DOCUMENT /// RUBIS

209

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

12/31/2016 Borrowings and ﬁnancial debt (in thousands of euros) Credit institution loans Other loans and similar liabilities TOTAL

As of December 31, 2016 (in thousands of euros)

Mortgages

1 to 5 years

More than 5 years

744,433

38,030

6,604

9,807

751,037

47,837

Pledged securities

Pledged property, plant and equipment

Other guarantees

Unsecured

Total

52,520

2,696

87,226

859,725

1,002,167

25,565

40,189

Credit institution loans Bank overdrafts

14,624

Other loans and similar liabilities TOTAL

52,520

2,696

101,850

17,089

902,379

1,059,445

The change in borrowings and other current and non-current ﬁnancial liabilities between December 31, 2015 and December 31, 2016 breaks down as follows:

(in thousands of euros) Current and non-current borrowings and ﬁnancial debt

12/31/2015

Changes in consolidation scope

Issue

Repayment

Foreign exchange differences

12/31/2016

1,123,158

2,477

231,563

(290,47)

(5,113)

1,061,338

Changes in the scope of consolidation result primarily from the consolidation of Reatile activities in Southern Africa. Issues made during the period are mainly explained by the ﬁnancing of capital expenditure and changes in the structure of the 3 divisions. 12/31/2016 (in thousands of euros)

Fixed rate

Credit institution loans

123,790

658,673

17,299

202,405

141,089

861,078

Credit institution loans (short-term portion) TOTAL

Financial covenants The Group’s consolidated net debt totaled €228 million as of December 31, 2016. Credit agreements include the commitment by the Group and by each of its operating segments to meet the

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RUBIS /// 2016 REGISTRATION DOCUMENT

following ﬁnancial ratios during the term of the loans:

• net debt to shareholders’ equity ratio of less than 1;

• net debt to Ebitda ratio of less than 3.5.

Variable rate

As of December 31, 2016, the Group’s ratios show that Rubis can comfortably meet its commitments; likewise, the Group’s overall position and its outlook remove any likelihood that events might result in an acceleration of maturities. Failure to comply with these ratios would result in the early repayment of the loans.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.10.2 Derivative financial instruments Hedges/entity

Item hedged

Nominal amount hedged

Maturity

Type of instrument

Market value as of 12/31/2016 (in thousands of euros)

Rate Rubis Terminal

Loan

€50M

01/2017

swap

(40)

Loan

€30M

03/2020

swap

(397)

Loan

€25M

09/2020

swap

(635)

Loan

€25M

09/2026

cap

255

Loan

€15M

12/2019

swap

(192)

Loan

€12M

12/2019

swap

(58)

Loan

€3M

11/2017

swap

(22)

Loan

€19M

06/2018

swap

(64)

Loan

€50M

11/2019

swap

(651)

Loan

€50M

10/2017

swap

(158)

Loan

€43M

01/2022

swap

(462)

Loan

€100M

12/2019

swap

(595)

Loan

€40M

07/2020

swap

(192)

Loan

€66M

05/2022

swap

(698)

Loan

€56M

01/2020

swap

(301)

Vitogaz Switzerland

Loan

CHF3M

12/2017

swap

(18)

Rubis Antilles Guyane

Loan

€1M

07/2018

swap

(24)

Loan

€1M

07/2018

swap

(8)

Loan

€2M

07/2017

cap

Propane purchases

24,420 t

03/2017 to 10/2019

swap

Rubis Énergie

Propane Rubis Énergie TOTAL FINANCIAL INSTRUMENTS

€589M

The fair value of derivative financial instruments carried by the Group includes a “counterparty risk” component for derivative assets and an “own credit risk”

2,297 (1,964)

component for derivative instrument liabilities. Credit risk is assessed using conventional mathematical models for market participants. Adjustments

recorded in respect of counterparty risk and own credit risk as of December 31, 2016 were not material.

Interest rate risk

Characteristics of loans contracted Euros Pula Swiss francs Rands

Rate

Total amount of lines (in thousands of euros)

Fixed rate Variable rate

Jamaican dollars

Less than 1 year

Between 1 and 5 years

More than 5 years

124,154

12,597

103,527

8,030

807,141

197,477

579,664

30,000

Existence or not of a hedge YES

Fixed rate Variable rate

1,420

468

952

Fixed rate

4,093

2,367

1,726

Variable rate

19,089

3,725

15,364

2,596

735

1,861

YES

Fixed rate Variable rate

US dollars

Maturity

Fixed rate Variable rate

30,832

Fixed rate

12,842

2,335

30,832 10,507

1,002,167

219,704

744,433

Variable rate TOTAL

38,030

Interest rate risk for the Group is limited to the loans obtained. None of the Group’s loans to date is likely to be repaid due to the enforcement of covenants.

2016 REGISTRATION DOCUMENT /// RUBIS

211

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

The Group had established interest rate hedging agreements (swaps) in the amount of €589 million on a total of €861.1 million of variable rate debt as of December 31, 2016, representing 68% of this amount (see “Off-balance sheet items” line in table below). Overnight to 1 year(4)

1 to 5 years

More than 5 years

Borrowings and ﬁnancial debt excluding consignments(1)

262,464

751,037

47,837

Financial assets(2)

833,652

(in thousands of euros)

Position before management transactions

(571,188)

751,037

47,837

Off-balance sheet items(3)

(106,000)

(349,000)

(134,000)

(677,188)

402,037

(86,163)

NET POSITION AFTER MANAGEMENT (1) (2) (3) (4)

Loans from credit institutions, bank overdrafts, accrued interest not yet due and other borrowings and debt. Cash and cash equivalents. Derivative ﬁnancial instruments. Including variable rate assets and liabilities

Interest rate sensitivity The Group’s net variable rate debt totaled €67.6 million: confirmed variable rate loans (€861.1 million) plus bank loans for operational needs (€40.2 million), minus cash on hand (€833.7 million). In light of the hedging put in place, a 1% change in short-term interest rates would not have a significant impact on the Group’s ﬁnancial income and expenses, on the cost of net ﬁnancial debt, or on net income for 2016 (impact of less than €1 million before tax).

Foreign exchange risk Rubis purchases petroleum products in US dollars; its only potential exposure is therefore to this currency. With regard to storage business, CPA (trading business) remains marginally exposed (virtually no position) to foreign exchange risk as its purchases in US

212

RUBIS /// 2016 REGISTRATION DOCUMENT

dollars are ﬁnanced by daily exchanges of euros for dollars, corresponding to the sales made. A positive US dollar position may occasionally occur when inventory is low, and in that case corresponds to the value of the base stock to be replenished. Delta Rubis Petrol, a Turkey-based joint venture, has selected the dollar as its functional currency, as its main transactions are denominated in US dollars. As of December 31, 2016 the Rubis Énergie and Rubis Support and Services divisions showed a net positive position of $18 million consisting of debts, receivables and, more marginally, cash and cash equivalents. A €0.01 fall in the euro against the dollar would not entail a material foreign exchange risk (less than €0.2 million before tax).

(in millions of US dollars)

12/31/2016

Assets Liabilities Position before management transactions

34.4 (52.4) (18)

Off-balance sheet position NET POSITION AFTER MANAGEMENT

(18)

Risk of fluctuations in petroleum product prices The following 2 factors must be considered when analy zing the risk related to ﬂuctuations in petroleum product prices:

• petroleum product price fluctuation risk is mitigated by the short product storage times;

• commercial rates are revised on a regular basis, based on market conditions.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.10.3 Other liabilities Accounting policies A put option granted to a minority shareholder entails the obligation for the consolidating entity to purchase, at a future date, the shares held by the minority shareholder at a speciﬁed exercise price, if said minority shareholder exercises its option. This contractual obligation gives rise to the recognition of a liability for which the counterpart entry is recognized for the full amount of the carrying value as a deduction from non-controlling interests, with the balance recognized in equity attributable to owners of the parent. Regarding subsequent changes in that liability, the Group has opted for the method described below for acquisitions performed during the 2015 ﬁscal year (see note 3.2 “Changes in the scope of consolidation”). All subsequent changes in the liability, including those due to changes in the estimated value of the put exercise price, are recognized for the full amount of their carrying value under non-controlling interests, with the balance recognized in equity attributable to owners of the parent. Changes due to accretion are processed in the same way.

Current (in thousands of euros) Prepaid income and other accruals Fair value of ﬁnancial instruments TOTAL

Non-current (in thousands of euros)

12/31/2016

12/31/2015

18,362

16,178

4,597

3,800

22,959

19,978

12/31/2016

12/31/2015

Debt on the acquisition of ﬁxed assets (long-term portion)

118,371

Other liabilities (long-term portion)

1,564

Prepaid income (long-term portion)

2,283

1,446 2,470

TOTAL

3,847

122,287

The change in debt on the acquisition of ﬁxed assets is due to the unwinding of the put held on the Eres minority shareholder, see note 3.2.1 “Acquisition of the residual 25% of the Eres Group”.

4.10.4 Trade and other payables (current operating liabilities) (in thousands of euros) Trade payables

12/31/2016

12/31/2015

204,567

165,957

Debt on the acquisition of ﬁxed assets (long-term portion)

11,516

35,209

Liabilities related to payroll

34,021

37,941

Taxes payable

73,574

64,849

Expenses payable

121

105

Current accounts (to non-controlling interests)

993

30,451

26,361

355,243

330,497

Miscellaneous operating liabilities TOTAL

Reconciliation of change in working capital with the statement of cash flows Net carrying amount as of 12/31/2016

355,243

Net carrying amount as of 12/31/2015

330,497

CHANGE IN TRADE AND OTHER PAYABLES ON THE BALANCE SHEET

24,746

(-) impact of change in the scope of consolidation

39,607

(-) impact of exchange differences

(5,089)

(-) impact of reclassiﬁcations

11,697

(-) impact of change in payables on acquisition of assets (in investment)

23,692

(-) impact of change in dividends to be paid (in ﬁnancing) (+) impact of change in other liabilities (long-term portion) CHANGE IN TRADE AND OTHER PAYABLES ON THE STATEMENT OF CASH FLOWS

(30) (31,730) 62,893

2016 REGISTRATION DOCUMENT /// RUBIS

213

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

4.10.5 Liquidity risk Risk related to supplier and subcontractor dependence Group purchases made with the largest supplier, the top 5 suppliers and the top 10 suppliers over the past 2 ﬁscal years: 2016 Top supplier

2015

12%

Top 5 suppliers

34%

35%

Top 10 suppliers

43%

47%

Liquidity risk In the year ended December 31, 2016, the Group used conﬁrmed credit facilities totaling €805.3 million. Given the Group’s

net debt to shareholders’ equity ratio (11%) as of December 31, 2016 and its cash ﬂow, the ability to draw down these

Repayment schedule (in millions of euros)

lines is not likely to be put at risk due to a breach of covenants.

Less than 1 year

1 to 5 years

More than 5 years

220

744

At the same time, the Group has €834 million in immediately available cash on the assets side of its balance sheet. The remaining contractual maturities of the Group’s ﬁnancial liabilities break down as follows (including interest payments): Financial liabilities (in thousands of euros)

Book value

Contractual cash ﬂows

Borrowings and ﬁnancial debt

798,874

820,943

Deposit/consignment

102,967

Other non-current liabilities

Under 1 month

1 to 3 months

3 months to 1 year

563 183,628

1 to 5 years

48,320

820,943

65,368

36,958

102,967

3,824

3,847

262,464

270,833

62,340

24,865

Trade and other payables

355,243

232,859

74,168

34,303

13,881

22,959

3,553

3,668

15,118

620

1,546,354

1,576,791

298,778

102,753

233,613

856,315

TOTAL

Total

772,623

Borrowings and bank overdrafts Other current liabilities

More than 5 years

3,847 270,833

355,243

85,332

1,576,791

22,959

The difference between contractual cash ﬂows and the book values of ﬁnancial liabilities mainly corresponds to future interest.

Rubis’ image:

Serious, discreet, efficient. Rubis, in short, is a nugget in the energy universe. François, service provider

214

RUBIS /// 2016 REGISTRATION DOCUMENT

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

4.11 OTHER PROVISIONS (EXCLUDING EMPLOYEE BENEFITS) Accounting policies Provisions are recognized when the Group has a current (legal or implicit) obligation to a third party resulting from a past event, when it is likely that an outflow of resources representing economic benefits will be necessary to settle the obligation, and when the amount of the obligation can be reliably estimated. Dismantling and clean-up Provisions are made for future site rehabilitation expenditures (dismantling and clean-up), arising from a current legal or implicit obligation, based on a reasonable estimate of their fair value during the fiscal year in which the obligation arises. The counterpart of this provision is included in the net book value of the underlying asset and is depreciated according to the asset’s useful life. Subsequent adjustments to the provision following, in particular, a revision of the outflow of resources or the discount rate are symmetrically deducted from or added to the cost of the underlying asset. The impact of accretion (the passage of time) on the provision for site rehabilitation is measured by applying a risk-free interest rate to the provision. Accretion is recorded under “Other financial income and expenses.” Litigation and claims Provisions for litigation and claims are recognized when the Group has an obligation relating to legal action, tax audits, vexatious litigation or other claims resulting from past events that are still pending, when it is likely that an outflow of resources representing economic benefits will be necessary to settle the obligation, and when the amount of the obligation can be reliably estimated. The Group takes advice from its counsel and lawyers in order to asses the likelihood of the occurrence of risks and to estimate provisions for litigation and claims by including the probabilities of the various scenarios envisaged taking place. Restructuring In the case of restructuring, an obligation is established once the reorganization and a detailed plan for its execution have been announced, or started. If the impact of time value is significant, provisions are discounted to present value.

Non-current (in thousands of euros)

12/31/2016

12/31/2015

Provisions for contingencies and expenses

43,027

40,568

Provisions for clean-up and asset renovation

34,138

34,476

TOTAL

77,165

75,044

amount was recognized at the time of the Société Réunionnaise de Produits Pétroliers acquisition and €2 million that was used as of December 31, 2015);

Provisions for contingencies and expenses include:

• a €12 million provision recognized on December 31, 2016 in relation to the Rubis Group’s obligation to customize some of the assets obtained from its new acquisitions (€2.5 million of this

(in thousands of euros)

• provisions relating to risks or disputes that could potentially lead to action being taken against the Rubis Group.

12/31/2015

Changes in consolidation scope

Allowances

Reversals*

40,568

261

11,043

(11,655)

Provisions for contingencies and expenses Provisions for clean-up and asset renovation

34,476

100

5,805

(6,103)

TOTAL

75,044

361

16,848

(17,758)

Provisions for the replacement of fixed assets are compliant with IAS 16. The Group has estimated its clean-up and dismantling costs largely based on the findings of outside consultants. In compliance with IAS 16, the present value of these expenses was incorporated into the cost of the corresponding facilities.

Reclassiﬁcations

Foreign exchange differences

12/31/2016

2,693

117

43,027

2,693

(140)

34,138

(23)

77,165

All reversals have been used.

Changes in the scope of consolidation result from the revision of the value of certain liabilities assumed for Société Réunionnaise de Produits Pétroliers.

The reclassifications made during the period are offset essentially in “Trade and other receivables” and “Trade and other

payables”. They adjust earlier accounting classiﬁcations.

2016 REGISTRATION DOCUMENT /// RUBIS

215

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Change in provisions for contingencies and expenses mainly reﬂects:

(see note 3.2.3 of the 2013 Registration Document);

• the Group’s assessment of the risks for

• expenses incurred in customizing the

• the Group’s obligations in terms of

Provisions created or reversed during the period are not of material size when taken individually.

assets;

• the €3.4 million reversal of provisions

collecting energy savings certiﬁcates;

• payments in legal disputes between

for clean-up previously recognized and relating to the Petroplus Reichstett site

which it could be held liable.

the Group and third parties;

4.12 EMPLOYEE BENEFITS Accounting policies The Group’s employees are entitled to:

• deﬁned-contribution pension plans applicable under general law in the relevant countries; • supplementary pension beneﬁts and retirement allowances (French, Bermudan and Portuguese companies and entities located in Barbados, Guyana and the Bahamas);

• a closed supplementary pension plan (FSCI pension funds, Channel Islands); • post-employment health plans (Bermudan, Portuguese and South African companies). The Group’s only obligations under defined-contribution plans are premium payments; the expense corresponding to premium payments is recorded in the results for the year. Under defined-benefit plans, pension commitments and related obligations are valued according to the actuarial projected unit credit method based on final salary. The calculations include actuarial assumptions, mainly pertaining to mortality, personnel turnover rates, final salary forecasts and the discount rate. These assumptions take into account the economic conditions of each country or each Group entity. The rate is determined in relation to high-quality corporate bonds in the region in question. These valuations are performed twice a year. Actuarial gains and losses on defined-benefit post-employment benefit plans resulting from changing actuarial assumptions or experience-related adjustments (differences between previous actuarial assumptions and actual recorded staffing events) are recognized in full under other comprehensive income for the period in which they are incurred. The same applies to any adjustments resulting from the limiting of hedging assets in the case of over-financed plans. These items are never subsequently recycled into profit and loss. In accordance with the IFRIC 14 interpretation, net assets resulting from over-financing of the FSCI’s defined-benefit pension plans are not recognized in the Group’s accounts, as the Group does not have an unconditional right to receive this surplus. The employees of Vitogaz France, Rubis Énergie, Frangaz, ViTO Corse, Rubis Antilles Guyane, Sara, SRPP, Rubis Energia Portugal, Rubis Energy Bermuda and Vitogaz Switzerland are also entitled to seniority bonuses related to the awarding of long-service medals, which fall into the category of long-term benefits, as defined in IAS 19. The amount of the bonuses likely to be awarded has been valued via the method used to value post-employment defined-benefit plans, except for actuarial gains and losses recognized in the income statement for the period during which they are incurred. Employees of Sara are entitled to progressive pre-retirement plans, early retirement, and retirement leave. The total amount of the commitments corresponding to pre-retirement allowances and early retirement has been assessed using the method described above.

The employee beneﬁts granted by the Group are broken down by type in the table below. (in thousands of euros)

12/31/2016

12/31/2015

Provision for pensions

34,598

34,334

Provision for health and mutual insurance coverage

11,084

7,804

Provision for long-service awards TOTAL

216

RUBIS /// 2016 REGISTRATION DOCUMENT

2,020

2,089

47,702

44,227

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

The change in provisions for employee beneﬁts breaks down as follows: 2016

2015

44,227

33,045

Newly consolidated/de-consolidated companies

4,188

13,520

Interest expense for the period

2,174

1,733

Service cost for the period

2,950

2,011

Expected return on fund assets for the period

(5,425)

(1,826)

Beneﬁts paid for the period

(4,675)

(2,602)

3,497

(2,117)

(in thousands of euros) PROVISIONS AS OF JANUARY 1

Actuarial losses/(gains) and limitation of assets Foreign exchange differences PROVISIONS AS OF DECEMBER 31

Post-employment benefits

• pension fund commitments in

Post-employment commitments comprise:

England; this scheme was closed in November 2008;

• retirement benefit commitments

• pre-retirement bonuses and early

(France, Portugal, Turkey, South Africa, Caribbean and Bermuda);

retirement at Sara (Antilles);

• commitments made by companies located in Portugal, Bermuda and S o u t h Af r ic a to p rov id e h eal t h

765

463

47,702

44,227

insurance coverage upon retirement to employees who worked at these entities when they were acquired by the Group. Po s t- e m p l o y m e n t b e n e f i t s a s o f December 31, 2015 and 2016 were assessed by an independent actuary, using the following assumptions:

2016

2015

Discount rate

0% to 16.5%

0% to 8.56%

Rate of inﬂation

0% to 3.20%

1% to 7.34%

Assumptions (within a range depending on the entity)

Rate of wage increases Age when voluntary retirement taken

Actuarial differences are offset against shareholders’ equity.

with terms equivalent to those of the commitments on the date of assessment.

The discount rates used were determined by reference to the yields on high-quality corporate bonds (minimum rating of AA)

The calculation of the sensitivity of the provision for commitments to a change of 1/4 of a percentage point in the discount

0% to 25%

0% to 4.50%

60 to 66 years

61 to 66 years

rate shows that the total obligation and the components of income would not be signiﬁcantly affected, in view of the total sum recognized in the Group’s accounts under employee beneﬁts.

Sensitivity (in thousands of euros)

Provision for commitments

Measurement of the provision as of 12/31/2016

47,702

Measurement of the provision – assuming discount rate cut by 0.25%

49,183

Measurement of the provision – assuming discount rate raised by 0.25%

41,705

Detail of commitments 12/31/2016

12/31/2015

Actuarial liabilities for commitments not covered by assets

41,051

42,109

Actuarial liabilities for commitments covered by assets

37,739

31,144

(37,739)

(33,985)

41,051

39,268

(in thousands of euros)

Market value of hedging assets Deﬁcit Limitation of assets (overfunded plans) PROVISION RECOGNIZED AS OF DECEMBER 31

4,631

2,870

45,682

42,138

2016 REGISTRATION DOCUMENT /// RUBIS

217

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Actuarial debt trend 2016

2015

73,253

62,229

Service cost for the period

2,617

1,801

Interest expense for the period

2,034

898

(4,416)

(3,321)

(in thousands of euros) ACTUARIAL LIABILITIES AS OF JANUARY 1

Beneﬁts paid for the period Actuarial losses/(gains) and limitation of assets

3,193

(3,483)

Newly consolidated companies and change in percentage of interest*

4,269

12,753

Foreign exchange differences

(2,160)

2,376

ACTUARIAL DEBT AS OF DECEMBER 31

78,790

73,253

Made up largely of the actuarial liability of Bermuda Gas (newly consolidated) and the Eres Group (corrections made during the allocation period).

Hedging asset trends 2016

2015

33,985

30,410

(2,945)

1,729

7,160

1,502

(469)

(613)

(in thousands of euros) Hedging assets as of January 1 Newly consolidated Translation adjustment Expected return on fund assets Beneﬁts paid Actuarial differences Hedging assets as of December 31

957

37,739

33,985

Limitation of assets

(4,631)

(2,870)

ASSETS RECOGNIZED AS OF DECEMBER 31

33,107

31,115

Geographic breakdown of employee benefits (in thousands of euros)

Europe

Caribbean

Africa

Actuarial assumptions

0% to 2.84%

1.05% to 4.47%

8.72% to 16.5%

8,668

36,262

752

617

1,403

Provision for pensions and health insurance coverage Provision for long-service awards

When I was little…

My childhood dream was to enter a monastery! Today, in the Group…

Determination and commitment, which are required for the position I hold at Rubis, have always been fed by compassion and goodwill, to meet and direct this ambitious challenge. Rubis: a pathway, a mission! Rubis’ Managing Partners:

A professionally complementary, humane, and visionary pair that deftly combine prudence with daring. In total objectivity or, better yet, good faith: demigods! Evelyne Peloye, Communications Director, Rubis

218

RUBIS /// 2016 REGISTRATION DOCUMENT

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Note 5. Notes to the income statement Accounting policies The Group uses gross operating proﬁt (Ebitda) as a performance indicator. Gross operating proﬁt corresponds to net revenue minus:

• consumed purchases; • external expenses; • payroll expenses; • taxes. The Group uses current operating income (Ebit) as its main performance indicator. Current operating income corresponds to gross operating proﬁt after:

• other operating income; • net depreciation and provisions; • other operating income and expenses. To better present the operating performance in the business lines, the equity associates’ net income is shown on a speciﬁc line in operating income.

5.1

REVENUE

Accounting policies Revenue from the Group’s activities is recognized:

• for income arising from storage activities (Rubis Terminal), spread over the term of the service contract; • for income arising from trading and distribution activities (Rubis Énergie), upon delivery; for the recently-acquired bitumen activity, revenue is mainly recognized at the bulk tank outlet;

• for income earned by the support and services activities (Rubis Support and Services), recognition is upon delivery and according to the term of the service contract. Transport services associated with the supply of bitumen are mainly invoiced at the bulk tank outlet. As regards Sara, revenue from the sale of petroleum products is recognized at the bulk tank outlet when the product leaves the reﬁnery or the other depots. Revenue from electricity sales is recognized at the end of the month on the basis of meter readings. In the case of administered margins, revenue is restated by recognizing accrued income, if applicable, or deferred income, in order to take into account the substance of the operations. Operations carried out on behalf of third parties are excluded from revenue and purchases in line with industry practices.

2016 REGISTRATION DOCUMENT /// RUBIS

219

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Revenue is detailed in the table below by business segment of activity and geographic zone of the consolidated companies. 12/31/2016 (in thousands of euros) SALES OF MERCHANDISE

12/31/2015*

Amount

1,935,932

100%

1,902,692

100% 8.7%

Rubis Terminal

156,091

8.1%

164,612

Rubis Énergie Europe

206,439

10.7%

189,106

9.9%

1,117,439

57.7%

1,196,361

62.9%

Rubis Énergie Africa

354,733

18.3%

219,456

11.5%

Rubis Support and Services

101,230

5.2%

133,157

7.0%

Rubis Énergie Caribbean

Parent company REVENUE FROM MANUFACTURING OF GOODS AND SERVICES

1,067,948

100%

1,010,683

100%

Rubis Terminal

132,125

12.4%

128,627

12.7%

Rubis Énergie Europe

308,425

28.9%

336,261

33.3%

25,292

2.4%

19,613

1.9%

Rubis Énergie Africa

140,728

13.2%

108,770

10.8%

Rubis Support and Services

461,378

43.2%

417,412

41.3%

Rubis Énergie Caribbean

Parent company TOTAL *

2,913,375

3,003,880

The allocation of activities between the Rubis Énergie and Rubis Support and Services business units was modiﬁed in 2016. For purposes of comparison, the 2015 data have been restated.

5.2

CONSUMED PURCHASES 12/31/2016

12/31/2015

Purchase of raw materials, supplies and other materials

255,279

231,995

Change in inventories of raw materials, supplies and other materials

(25,002)

16,128

(in thousands of euros)

Goods-in-process inventory Other purchases Merchandise purchases Change in merchandise inventories Provisions net of reversals of impairment for raw materials and merchandise TOTAL

5.3

5,055

9,255

20,952

23,034

1,794,917

1,761,061

(19,166)

46,463

(366)

(1,491)

2,031,669

2,086,445

12/31/2016

12/31/2015

122,275

102,830

PERSONNEL COSTS

The Group’s personnel costs break down as follows: (in thousands of euros) Salaries and wages Management compensation

3,327

3,346

Social security contributions

54,317

49,911

179,919

156,087

TOTAL

The Group’s average headcount breaks down as follows: 12/31/2016

Average headcount of fully consolidated companies by category Executives

416

Employees and workers

1,703

Supervisors and technicians

590

TOTAL

Average headcount of fully consolidated companies TOTAL *

12/31/2015

New hires*

Departures

12/31/2016

2,608

644

(543)

2,709

Of which 18 attributable to the newly consolidated Bermuda Gas.

Share of average headcount of proportionately consolidated companies TOTAL

220

2,709

RUBIS /// 2016 REGISTRATION DOCUMENT

12/31/2016 13

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

5.4

EXTERNAL EXPENSES

Accounting policies Operating leases: leases that do not have the characteristics of a ďŹ nance lease are operating leases, for which only the rental payments are recorded in the income statement.

12/31/2016

12/31/2015

Leases and rental expenses

21,346

18,634

Compensation of intermediaries and professional fees

22,355

20,408

Other external services

258,322

217,936

TOTAL

302,023

256,978

12/31/2016

12/31/2015

(in thousands of euros)

5.5

NET DEPRECIATION AND PROVISIONS

(in thousands of euros) Intangible assets Property, plant and equipment Current assets Operating contingencies and expenses TOTAL

5.6

1,771

1,249

111,804

95,466

(2,170)

3,214

1,810

5,537

113,215

105,466

12/31/2016

12/31/2015

OTHER OPERATING CONTINGENCIES AND EXPENSES

(in thousands of euros) Operating subsidies

Other miscellaneous income

4,728

3,621

OTHER OPERATING INCOME

4,733

3,630

Other miscellaneous expenses

5,196

5,411

OTHER OPERATING EXPENSES

5,196

5,411

TOTAL

(463)

(1,781)

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221

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

5.7

OTHER OPERATING INCOME AND EXPENSES

Accounting policies The Group sets aside operating income and expenses which are unusual, infrequent or, generally speaking, non-recurring, and which could impair the readability of the Group’s operational performance. Other operating income and expenses include the impact of the following on proﬁt and loss:

• acquisitions and disposals of companies (negative goodwill, strategic acquisition costs, capital gains or losses, etc.); • capital gains or losses or scrapped property, plant and equipment or intangible assets; • other unusual and non-recurrent income and expenses; • signiﬁcant provisions and impairment of property, plant and equipment or intangible assets.

12/31/2016

(in thousands of euros)

(771)

1,497

Strategic acquisition expenses

(344)

(1,815)

Other expenses, income and provisions

(289)

(37,155)

Impact of business combinations and disposals

2,949

42,819

TOTAL

1,545

5,346

In 2015, other expenses, income and provisions included in particular the €30 million impairment loss recognized on the goodwill for the petroleum products distribution business in Europe (see note 4.2 “Goodwill” in the 2015 Registration Document).

5.8

In 2 015, the impac t of busine s s combinations mainly recorded the €40.9 million gain recognized for the purchase of the additional 35.5% interest in the Sara refinery and the resulting c hang e in consolidation method (see note 3.2.2 “Change in scope of

consolidation” in the 2015 Registration Document). In 2016, the impact of the business combinations primarily included the capital gain on the disposal of Multigas operations (see note 3.2.4 “Change in scope of consolidation – Disposal of Multigas”).

COST OF NET FINANCIAL DEBT

(in thousands of euros) Income from cash and cash equivalents Net proceeds from disposal of marketable securities Interest on borrowings and other ﬁnancial debt TOTAL

222

12/31/2015

Income from disposal of property, plant and equipment and intangible assets

RUBIS /// 2016 REGISTRATION DOCUMENT

12/31/2016

12/31/2015

3,589

4,727

433

115

(17,181)

(16,459)

(13,159)

(11,617)

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

5.9

OTHER FINANCIAL INCOME AND EXPENSES

Accounting policies Transactions denominated in foreign currencies are converted by the subsidiary into its operating currency at the rate applicable on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are converted at the exchange rate in effect at the closing date of each accounting period. The corresponding foreign exchange differences are recorded in the income statement under “Other ﬁnancial income and expenses”.

12/31/2016

12/31/2015

Foreign exchange losses

(9,911)

(8,874)

Foreign exchange gains

6,104

9,775

(in thousands of euros)

Other ﬁnancial income and expenses TOTAL

644

2,232

(3,162)

3,133

5.10 INCOME TAX

5.10.1 Income tax on French tax group companies Current income tax expense Current income tax expense corresponds to the amount of income tax payable to the tax authorities for the ﬁscal period, in accordance with applicable regulations and tax rates in effect in France. The base tax rate in France is 33.33%.

Finance Act. This contribution is based on the corporate income tax payable by companies that generate revenue in excess of €250 million. The 2016 Finance Act maintained the permanent elimination of this additional contribution for fiscal years ending December 31, 2016 and later (last application on 2015 income tax).

The Social Security Finance Act No. 991140 of December 29, 1999 established an additional tax of 3.3% of the base tax payable; the legal tax rate for French companies was thus increased by 1.1%.

Deferred tax assets and liabilities

The amending Finance Act of 2011 had established an exceptional contribution of 5%, raised to 10.7% by the 2014

Defer red income ta x ex pense is determined using the method described in note 4.6.

As a result, income from the French tax consolidation group is taxed at a rate of 34.43%.

The 2017 Finance Act contains a gradual reduction in the rate of income tax from 34.43% down to 28.92% in 2020 for all companies. This reduction will be made in successive steps depending on the revenue. The Group will take full advantage of this measure starting in 2020. The 2016 consolidated ﬁnancial statements include an income of €4.8 million due to this future rate reduction. The IFRS do provide that deferred tax assets and liabilities must be measured using the tax rate in effect at the time of their probable use. This measurement will be updated at each balance sheet date.

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223

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

5.10.2 Reconciliation between theoretical income tax applicable in France and actual income tax expense 12/31/2016 (in thousands of euros)

Income

Tax

Rate

INCOME AT THE NORMAL RATE

284,899

(98,091)

34.43%

Geographic impact

36,123

-12.7%

Distribution tax (share of cost and expenses, withholding tax)

(4,031)

1.4%

Speciﬁc tax of 3% on dividends

(1,653)

0.6%

Permanent differences

(1,068)

0.4%

(806)

0.3%

293

-0.1%

4,768

-1.7%

Tax adjustments and risks Impact of operations taxed at a reduced rate Effect of changes in rate Other INCOME BEFORE TAX AND SHARE OF NET INCOME FROM JOINT VENTURES Share of net income from joint ventures INCOME BEFORE TAX

284,899

145

-0.1%

(64,320)

22.6%

(64,320)

22.1%

6,798 291,697

5.11 EARNINGS PER SHARE Accounting policies Basic earnings per share is calculated by dividing net income, Group share by the weighted average number of shares outstanding during the ﬁscal year. The weighted average number of shares outstanding is calculated based on any changes in share capital during the period, multiplied by a weighting factor depending on the time, and adjusted, where applicable, to take into account the Group’s treasury share holdings. Diluted net earnings per share is calculated by dividing net income, Group share by the weighted average number of shares outstanding, increased by the maximal amount of impact from the conversion of all dilutive instruments.

In both cases, the shares included in the calculation of the weighted average number of shares outstanding during the ﬁscal year are those which provide unlimited entitlement to earnings. The table below presents the income and shares used to calculate basic earnings and diluted earnings per share. Earnings per share (in thousands of euros) Consolidated net income, Group share Impact of stock options on income Consolidated net income after recognition of the impact of stock options on income Number of shares at the beginning of the period

12/31/2015

208,022

169,880

257

351

208,279

170,231

43,216,952

38,869,079

Company savings plan

39,141

49,777

Equity line

77,897

Preferential subscription rights

142,843

1,657,990

Dividend in shares

793,073

557,215

Bonus shares

316,080

230,136

Average number of stock options

336,062

555,619

44,922,048

41,919,816

DILUTED EARNINGS PER SHARE (in euros)

4.64

4.06

UNDILUTED EARNINGS PER SHARE (in euros)

4.70

4.13

Average number of shares (including stock options)

224

12/31/2016

RUBIS /// 2016 REGISTRATION DOCUMENT

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

5.12 DIVIDEND

5.12.1 Dividends declared Rubis has always pursued an active dividend payment policy for its shareholders, as illustrated by the dividend payout ratio over the past 5 years, which has represented an average of 64% of net income, Group share.

Fiscal year concerned

Number of shares concerned

Net dividend distributed (in euros)

Total net amounts distributed (in euros)

OGM 06/13/2006

2005

8,450,594

1.90

16,056,129

OGM 06/14/2007

2006

8,727,872

2.14

18,677,646

OGM 06/12/2008

2007

9,931,546

2.45

24,332,287

O&EGM 06/10/2009

2008

10,295,269

2.65

27,282,463

OGM 06/10/2010

2009

11,042,591

2.85

31,471,384

O&EGM 06/09/2011

2010

14,534,985

3.05

44,331,704

O&EGM 06/07/2012

2011

30,431,861

1.67

50,821,208

O&EGM 06/07/2013

2012

33,326,488

1.84

61,320,738

O&EGM 06/05/2014

2013

37,516,780

1.95

73,157,721

O&EGM 06/05/2015

2014

38,889,996

2.05

79,724,492

O&EGM 06/09/2016

2015

43,324,068

2.42

104,844,245

Date of distribution

Note that the par value of each share was halved in July 2011.

5.12.2 Dividend per by-laws General Partners’ dividends are governed by Article 56 of the by-laws. For each ﬁscal period, the General Partners receive a dividend, which is calculated according

to the overall stock market performance of Rubis stock. This dividend is capped at a percentage of net income, Group share.

at the same time as the dividend paid to shareholders in respect of the year 2016 (after the 2017 O&EGM).

In respect of 2016, the dividend amount was €10,786 thousand (€20,056 thousand allocated for 2015). It will be distributed

2016 REGISTRATION DOCUMENT /// RUBIS

225

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Note 6. Segment information Accounting policies In accordance with IFRS 8, operating segments are those examined by the Group’s main operational decision-makers (the Managers). This segment analysis is based on internal organizational systems and the Group’s management structure. Apart from the Rubis holding company, the Group is managed in 3 main divisions:

• Rubis Terminal, comprising the bulk liquid products storage businesses; • Rubis Énergie, comprising petroleum products distribution businesses; • Rubis Support and Services, which houses all infrastructure, transportation, supply and services activities, supporting the development of downstream distribution and marketing activities. Furthermore, the Group has deﬁned 3 geographic segments:

• Europe; • Africa; • the Caribbean. Creation of the Rubis Support and Services division As explained in note 3.2 “Changes in the scope of consolidation” of the 2015 Registration Document, the acquisition of the Eres Group in early June 2015

6.1

was a major investment in the supply, transportation, services and infrastructure business lines. Group Management wished to create a third business line, Rubis Support and Services, which houses all infrastructure, transportation, supply and services activities, supporting the

development of downstream distribution and marketing activities. Sara and existing supply activities in the Caribbean have joined this new division, in which some Eres entities (vessels and support entities) are included.

INFORMATION BY BUSINESS SEGMENT

6.1.1

Elements in the income statement per business segment

The following table presents, for each business segment, information on revenue from ordinary business activities and the results for 2016 and 2015. Each column in

the table below contains ﬁgures speciﬁc to each segment as an independent entity; the “Intra-group” column groups together transactions and accounts

between the different segments, which have been eliminated.

12/31/2016

Rubis Terminal

Rubis Énergie

Rubis Support and Services

288,216

2,153,056

562,608 5,504

(5,504)

288,216

2,153,056

562,608

5,504

(5,504)

EBITDA

74,766

249,623

102,285

(15,179)

411,495

EBIT

53,587

192,263

69,134

(15,309)

299,675

(in thousands of euros) Revenue Intersegment revenue REVENUE

Share of net income from joint ventures

Intra-group eliminations

Total 3,003,880

6,798

3,003,880

6,798

OPERATING INCOME AFTER SHARE OF NET INCOME FROM JOINT VENTURES

58,180

196,122

69,041

(15,325)

Cost of net ﬁnancial debt

(3,779)

(12,667)

322

2,485

(15,671)

(35,743)

(11,106)

(1,800)

(64,320)

41,164

141,612

58,755

(14,154)

227,377

Income tax expense TOTAL NET INCOME

226

Parent company

RUBIS /// 2016 REGISTRATION DOCUMENT

308,018 480

(13,159)

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

12/31/2015*

(in thousands of euros)

Rubis Terminal

Rubis Énergie

Rubis Support and Services

Revenue

293,239

2,069,567

550,569 3,550

(3,550)

293,239

2,069,567

550,569

3,550

(3,550)

EBITDA

72,040

217,051

69,991

(14,526)

344,556

EBIT

51,370

154,950

48,459

(14,771)

240,008

Parent company

Share of net income from joint ventures

Total 2,913,375

Intersegment revenue REVENUE

Intra-group eliminations

4,976

2,913,375

4,976

OPERATING INCOME AFTER SHARE OF NET INCOME FROM JOINT VENTURES

54,408

121,398

89,369

(14,845)

Cost of net ﬁnancial debt

(3,941)

(12,541)

(434)

3,960

(16,036)

(29,400)

(8,678)

(5,503)

(59,617)

40,950

78,640

77,685

(15,046)

182,229

Income tax expense TOTAL NET INCOME *

250,330 1,339

(11,617)

The allocation of activities between the Rubis Énergie and Rubis Support and Services business units was modiﬁed in 2016. For purposes of comparison, the 2015 data have been restated.

6.1.2

Balance sheet items by business segment 12/31/2016

(in thousands of euros) Fixed assets Equity interests Investments in joint ventures Deferred tax assets

Rubis Terminal

Rubis Énergie

Rubis Support and Services

518,811

1,391,790

166,764

176,376

Parent company

Eliminations

Total

803

(305)

2,077,863

784,535

(957,600)

129,922

3,315 129,922

7,430

5,011

Segment assets

144,265

639,075

344,697

700,777

(337,839)

1,490,975

TOTAL ASSETS

793,082

2,214,671

516,472

1,486,115

(1,295,744)

3,714,596

Consolidated shareholders’ equity

412,910

775,847

313,377

1,446,425

(962,124)

1,986,435

Financial liabilities

273,737

737,655

48,743

1,511

(308)

1,061,338

Deferred tax liabilities

10,881

12,664

Segment liabilities

95,554

688,505

154,352

12,127

(333,312)

617,226

TOTAL LIABILITIES

793,082

2,214,671

516,472

1,486,115

(1,295,744)

3,714,596

Borrowings and ﬁnancial debt

273,737

737,655

48,743

1,511

(308)

1,061,338

16,833

269,481

141,882

405,456

256,904

468,174

(93,139)

(403,945)

(308)

227,686

66,715

73,623

22,040

167

Parent company 1,159

Cash and cash equivalents NET FINANCIAL DEBT CAPITAL EXPENDITURE

12,521

26,052

49,597

833,652 162,545

12/31/2015

(in thousands of euros)

Rubis Terminal

Rubis Énergie

Rubis Support and Services

Fixed assets

468,876

1,392,866

173,339

125,125

Equity interests Investments in joint ventures Deferred tax assets

731,900

Eliminations

Total 2,036,240

(853,722)

120,006

3,324 120,006

200

6,801

Segment assets

136,731

540,068

277,521

582,516

(177,016)

1,359,820

TOTAL ASSETS

725,834

2,064,860

450,870

1,315,575

(1,030,738)

3,526,401

Consolidated shareholders’ equity

339,699

585,897

306,979

1,283,117

(858,333)

1,657,359

Financial liabilities

247,099

828,845

45,941

1,581

(308)

1,123,158

11,696

18,068

1,412

20,214

Segment liabilities

127,340

632,050

96,538

10,663

(172,097)

694,494

TOTAL LIABILITIES

725,834

2,064,860

450,870

1,315,575

(1,030,738)

3,526,401

Borrowings and ﬁnancial debt

247,099

828,845

45,941

1,581

(308)

1,123,158

26,233

234,009

116,986

409,228

220,866

594,836

(71,045)

(407,647)

(308)

336,702

57,169

73,014

13,092

Deferred tax liabilities

Cash and cash equivalents NET FINANCIAL DEBT CAPITAL EXPENDITURE

7,011

51,390

786,456 143,305

2016 REGISTRATION DOCUMENT /// RUBIS

227

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

6.2 INFORMATION BY GEOGRAPHIC ZONE (AFTER NEUTRALIZATION OF INTERSEGMENT TRANSACTIONS) 12/31/2016 (in thousands of euros)

Europe

Caribbean

Africa

Total

Revenue

803,080

1,705,339

495,461

3,003,880

EBITDA

151,275

177,013

83,207

411,495

EBIT

106,003

126,451

67,221

299,675

Operating income after share of net income from joint ventures

115,681

124,867

67,470

308,018

Capital expenditure

92,385

53,205

16,955

162,545

(in thousands of euros)

Europe

Caribbean

Africa

Total

Revenue

818,606

1,766,543

328,226

2,913,375

EBITDA

12/31/2015*

149,827

151,903

42,826

344,556

EBIT

95,735

108,968

35,305

240,008

Operating income after share of net income from joint ventures

61,491

151,466

37,373

250,330

Capital expenditure

86,418

44,744

12,143

143,305

The allocation of activities between the Rubis Énergie and Rubis Support and Services business units was modiﬁed in 2016. For purposes of comparison, the 2015 data have been restated.

12/31/2016 (in thousands of euros) Fixed assets Equity interests Investments in joint ventures Deferred tax assets

Europe

Caribbean

Africa

Total

1,383,231

603,272

91,360

2,077,863

385

2,915

129,922

3,315 129,922

813

7,385

4,323

12,521

Segment assets

726,244

623,089

141,642

1,490,975

TOTAL ASSETS

2,240,595

1,236,661

237,340

3,714,596

Europe

Caribbean

Africa

Total

1,031,620

623,214

381,406

2,036,240

379

2,930

12/31/2015 (in thousands of euros) Fixed assets Equity interests Investments in joint ventures Deferred tax assets

3,324 120,006

918

3,883

2,210

7,011

Segment assets

678,523

497,053

184,244

1,359,820

TOTAL ASSETS

1,831,446

1,127,080

567,875

3,526,401

Rubis’ Culture:

Simple, accessible, and really effective. Rubis’ Managing Partners:

I’d say Gilles and Jacques are 2 great captains of industry. Their excellent reading of the globalized economy has allowed the Group to develop beyond the remarkable, while retaining in each subsidiary significant freedom to act, within the Group’s values. Pierre Gallucci, Managing Director, Rubis Antilles Guyane

228

120,006

RUBIS /// 2016 REGISTRATION DOCUMENT

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Note 7. Non-controlling interests Since 2015, non-controlling interests have undergone signiﬁcant changes.

Sara Since June 1, 2015, the Group has consolidated the 71% owned Sara using the full consolidation method; the 29% non-controlling interests are held by the Sol Petroleum Antilles SAS Group (see note 3.2.2 “Acquisition of 35.5% of Sara” of the 2015 Registration Document).

Eres Group

Easigas entities

The Eres entities are consolidated by the Group using the full consolidation method, with a percentage interest of:

The Group consolidates the Easigas entities using the full consolidation method, with a percentage interest of 60% held by the Group (see note 3.2.2 “Consolidation of non-controlling interests in Southern Africa”).

• 75% from the takeover to April 15, 2016; the 25% non-controlling interests were held by Sudring SA-SPF and Foca Investments SA (see note 3.2.3.1 “Acquisition of the Eres Group” of the 2015 Registration Document);

• 100% since April 15, 2016 (see note 3.2.1 “Acquisition of the residal 25% of the Eres Group”).

Rubis Énergie Djibouti Since October 1, 2015, as explained in note 3.2.3.3 of the 2015 Registration Document, the Group has owned the assets of Total in Djibouti, with a 15% non-controlling interest. The corresponding non-controlling interests are not material.

7.1 CONDENSED FINANCIAL INFORMATION – SUBSIDIARY WITH NON-CONTROLLING INTERESTS: SARA The amounts presented below are before the elimination of intercompany transactions and accounts: (in thousands of euros) Fixed assets Net ﬁnancial debt (cash and cash equivalents – liabilities) Current liabilities (including loans due in less than one year and short-term bank borrowings)

(in thousands of euros) NET REVENUE NET INCOME (EXCLUDING THE IMPACT OF THE ADDITIONAL ACQUISITION IN 2015) Group share Share attributable to non-controlling interests OTHER COMPREHENSIVE INCOME

12/31/2016

12/31/2015

128,879

132,856

49,261

28,644

102,769

97,439

12/31/2016

12/31/2015 (7 months)

659,654

454,023

19,072

9,841

12,868

6,544

6,204

3,297

(120)

(1,064)

Group share

(85)

(755)

Share attributable to non-controlling interests

(35)

(309)

18,952

8,777

COMPREHENSIVE INCOME FOR THE PERIOD (EXCLUDING THE IMPACT OF THE ADDITIONAL ACQUISITION IN 2015) Group share Share attributable to non-controlling interests Dividends paid to non-controlling interests Cash ﬂow related to operations

12,783

5,789

6,169

2,988

4,154

2,393

52,242

58,404

Cash ﬂow related to investment activities

(17,144)

57,369

Cash ﬂows related to ﬁnancing activities

(11,679)

(41,188)

23,419

74,585

Change in cash and cash equivalents

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7.2 CONDENSED FINANCIAL INFORMATION – SUBSIDIARY WITH NON-CONTROLLING INTERESTS: EASIGAS SA AND SUBSIDIARIES The amounts presented below are before the elimination of intercompany transactions and accounts: 12/31/2016

(in thousands of euros) Fixed assets

56,130

Net ﬁnancial debt (cash and cash equivalents – liabilities) Current liabilities (including loans due in less than one year and short-term bank borrowings)

1,638 12,010

12/31/2016

(in thousands of euros) NET REVENUE

112,783

TOTAL NET INCOME

11,096

Group share

6,432

Share attributable to non-controlling interests

4,664

OTHER COMPREHENSIVE INCOME

Group share

Share attributable to non-controlling interests COMPREHENSIVE INCOME FOR THE PERIOD

3 11,103

Group share

6,436

Share attributable to non-controlling interests

4,667

Dividends paid to non-controlling interests Cash ﬂow related to operations

10,619

Cash ﬂow related to investment activities

(5,141)

Cash ﬂows related to ﬁnancing activities

(6,733)

Impact of exchange rate changes

2,034

Change in cash and cash equivalents

779

When I was little…

I dreamed of being Wonder Woman! Today, in the Group…

Taking care of business development and sealing a deal in storage activity is close to the mission of a superhero… except that we’re not saving lives! Rubis’ Managing Partners:

Empowering, trusting, receptive, close to the business, visionary, and prudent but ambitious. Clarisse Gobin Swiecznik, Executive Vice-President, Business Development, Rubis Terminal

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FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

Note 8. Interests in joint operations Group interests in joint operations refer only to Rubis Énergie and involve all of its business lines. These entities are not material as of December 31, 2016.

Note 9. Interests in joint ventures Accounting policies These investments, which are consolidated by the equity method, involve joint ventures and companies in which the Group has significant influence. They are initially recognized at acquisition cost, including any goodwill generated. Their net book value is then increased or decreased to recognize the Group share of the entity’s profits or losses after the date of acquisition. Whenever losses are greater than the value of the Group’s net investment in the equity method, these losses are not recognized unless the Group has entered into a commitment to recapitalize the entity or provide it with funding. If there is an indication that an investment may be impaired, its recoverable value is tested as described in note 4.2. Impairment losses shown by these impairment tests are recognized as a deduction from the net book value of the corresponding investments.

The Group has deemed 2 partnerships (Delta Rubis Petrol and its holding company, and ITC Rubis Terminal Antwerp) to be joint ventures within the meaning of IFRS.

9.1 CONDENSED FINANCIAL INFORMATION: THE ITC RUBIS TERMINAL ANTWERP JOINT VENTURE The ﬁgures below were prepared in accordance with IFRS at 100%. Company statement of ﬁnancial position (in thousands of euros) Current assets

12/31/2016

12/31/2015

3,248

3,527

Non-current assets

202,476

169,815

TOTAL ASSETS

205,724

173,342

Current liabilities

133,955

105,349

Non-current liabilities

2,800

2,186

136,755

107,535

12/31/2016

12/31/2015

Cash and cash equivalents

654

1,849

Current ﬁnancial liabilities (excl. trade payables and provisions)

802

2,800

2,186

12/31/2016

12/31/2015

18,811

16,333

3,162

2,818

3,162

2,818

TOTAL LIABILITIES

Current liabilities mainly include current account ﬁnancing by the 2 joint venturers. The assets and liabilities of the joint venture speciﬁcally include the following: (in thousands of euros)

Non-current ﬁnancial liabilities (excl. trade payables and provisions)

(in thousands of euros) Net revenue Total net income Other comprehensive income Comprehensive income for the period

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FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Net income for the period given above includes the following items: (in thousands of euros)

12/31/2016

12/31/2015

Depreciation expense

(4,384)

(4,116)

(553)

(481)

(1,434)

(294)

12/31/2016

12/31/2015

68,969

65,807

50%

34,485

32,904

Interest income and expense Income tax

(in thousands of euros) Net assets in the joint venture Rubis percentage held in the joint venture Goodwill Other adjustments NET BOOK VALUE OF THE GROUP’S INTEREST IN THE JOINT VENTURE

The Group received no dividends in respect of the period from the ITC Rubis Terminal Antwerp joint venture.

9.2 CONDENSED FINANCIAL INFORMATION: THE DELTA RUBIS PETROL AND ITS HOLDING COMPANY JOINT VENTURE The ﬁgures below were prepared in accordance with IFRS at 100%. Company statement of ﬁnancial position (in thousands of euros) Current assets

232

12/31/2016

12/31/2015

48,515

28,758

Non-current assets

209,997

208,690

TOTAL ASSETS

258,512

237,448

Current liabilities

20,405

18,216

Non-current liabilities

73,056

70,031

TOTAL LIABILITIES

93,461

88,247

RUBIS /// 2016 REGISTRATION DOCUMENT

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

The assets and liabilities of the joint venture specifically include the following: (in thousands of euros) Cash and cash equivalents Current financial liabilities (excl. trade payables and provisions) Non-current financial liabilities (excl. trade payables and provisions)

12/31/2016

12/31/2015

45,218

27,199

2,036

2,194

61,664

59,704

12/31/2016

12/31/2015

Net revenue

28,401

26,197

Total net income

10,434

7,134

6,223

17,347

16,657

24,481

(in thousands of euros)

12/31/2016

12/31/2015

Depreciation expense

(8,504)

(7,622)

Interest income and expense

(1,780)

(1,473)

(239)

(934)

12/31/2016

12/31/2015

165,051

149,201

(in thousands of euros)

Other comprehensive income Comprehensive income for the period

Net income for the period given above includes the following items:

Income tax

(in thousands of euros) Net assets in the joint venture Rubis percentage held in the joint venture Goodwill

50%

12,910

12,499

95,436

87,100

Other adjustments NET BOOK VALUE OF THE GROUP’S INTEREST IN THE JOINT VENTURE

The Group received no dividends in respect of the period from the Delta Rubis Petrol and its holding company joint venture.

Note 10. Other information 10.1 FINANCIAL COMMITMENTS

Commitments given and received 12/31/2016

12/31/2015

Liabilities secured

157,066

161,694

Commitments given

170,360

218,678

Guarantees and securities

170,630

218,678

Commitments received

368,809

416,167

Conﬁrmed credit facilities

331,663

396,165

Guarantees and securities

36,720

19,576

426

(in thousands of euros)

Other

The guarantees and securities given mainly concern:

• bank guarantees granted on loans obtained by the Group’s subsidiaries;

• guarantees required by suppliers of petroleum products;

• guarantees given to customs authorities;

• environmental guarantees. Guarantees and securities received largely concern guarantees obtained from customers located in the Caribbean zone and, to a lesser degree, customers of Vitogaz France. The Group established interest rate hedging agreements (swaps) in the

amount of €589 million on a total €861.1 million of variable rate debt as of December 31, 2016, representing 68% of that debt. As part of its acquisition and disposal transactions concerning subsidiaries, the Group gives or receives guarantees on liabilities, with no speciﬁc duration or amount.

2016 REGISTRATION DOCUMENT /// RUBIS

233

FINANCIAL STATEMENTS /// 2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES

Pledged assets as of December 31, 2016 On ﬁnancial assets (in thousands of euros)

Start date of pledge

Maturity date of pledge

12/12/11

07/25/2018

Amount of assets pledged (a)

Liabilities secured

Asset item total in gross value (b)

% a/b

11,712

58%

190,673

24%

Name of shareholder registered (directly registered shares) 2,520

6,742

2,520

6,742

50,000

45,072

TOTAL RUBIS TERMINAL

50,000

45,072

TOTAL SECURED DEBT

52,520

Rubis Antilles Guyane(1) TOTAL RUBIS ANTILLES GUYANE Rubis Terminal(2)

04/01/15

03/31/2021

Subsidiaries whose assets are pledged

Number of shares pledged

% of share capital pledged

(1) Société Antillaise des Pétroles Rubis

35,000

100%

Bred Banque Populaire LCL

Repayment of the loan in full

328,000

100%

ABN AMRO

Repayment of the loan in full

(2) Rubis Terminal BV

Condition for exercise of pledge

Beneﬁciary

The pledges of property, plant and equipment mentioned in note 4.10.1 corresponding to property held under ﬁnance leases are not included above. The pledged assets represent less than 2% of Rubis’ consolidated balance sheet as of December 31, 2016.

10.2 CONTRACTUAL AND TRADE COMMITMENTS Payments due by period Contractual commitments as of 12/31/2016 (in thousands of euros)

Total

Less than 1 year

Between 1 and 5 years

More than 5 years

1,002,167

219,704

744,433

38,030

4,825

1,534

3,254

173,513

18,074

53,114

102,325

Irrevocable purchase commitments (excluding interests)

1,060

Other long-term commitments

7,800

729

3,323

3,748

1,189,365

241,101

804,124

144,140

Credit institution loans Finance lease commitments Operating leases

TOTAL

The review of operating leases was subject to particular attention as part of the preparatory work for the implementation of IFRS 16 on leases. Commercial commitments made or received by the Group are not signiﬁcant.

10.3 RELATED PARTIES

Senior Managers’ compensation Management compensation is governed by Article 54 of the by-laws. It totaled €2,572 thousand for the fiscal year, including compensation due to the Management of the parent company (€2,265 thousand, for which the corresponding social securit y contributions are entirely borne by the

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RUBIS /// 2016 REGISTRATION DOCUMENT

Managers) and compensation due to management functions in the subsidiaries (i.e. €307 thousand gross).

of which are described in chapter 6, sec tion 6.4.1.2 of this Registration Document.

The 10 th resolution approved at the Annual General Meetings of Shareholders and Limited Partners on June 5, 2015 introduced a variable compensation component, the terms and conditions

Variable compensation recorded during 2016 was €1,062 thousand. Attendance fees paid to members of the parent company’s Supervisory Board totaled €127 thousand in ﬁscal 2016.

FINANCIAL STATEMENTS

2016 CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ///

10.4 FEES PAID TO STATUTORY AUDITORS Fees paid to the Statutory Auditors and members of their networks in respect of 2015 and 2016 break down as follows: Mazars Amount (excl. tax) (in thousands of euros)

2016

2015

SCP Monnot & Guibourt % 2016

Amount (excl. tax) 2015

2016

2015

Other

% 2016

Amount (excl. tax) 2015

2016

2015

% 2016

2015

Certification of financial statements Audit, certiﬁcation and examination of the separate and consolidated ﬁnancial statements

• Issuer • Fully consolidated subsidiaries SUB-TOTAL

338

336

24%

26%

158

154

61%

59%

995

843

72%

66%

103

36%

39%

769

953

99%

1,333

1,179

96%

93%

252

257

97%

98%

769

953

99%

Services other than the certification of financial statements

• Issuer • Fully consolidated subsidiaries SUB-TOTAL TOTAL

1,389

1,273

100%

259

262

100%

775

959

100%

Note 11. Subsequent events 11.1 ACQUISITION OF THE LEADING PETROLEUM PRODUCTS DISTRIBUTION BUSINESS IN HAITI In Februar y 2017, Rubis signed an agreement to purchase all of the stock of Dinasa and its subsidiary Sodigaz, the leading distributors of petroleum products in Haiti. With 600,000 m 3 under distribution, Dinasa is the country’s largest network of gas stations (125 stations) and operates

under the National brand and enjoys a presence throughout all segments of petroleum products with a leading position in aviation, LPG, commercial heating oil and lubricants. The company has strategic, self-sufficient logistical resources for importing (storage, maritime points of access).

Dinasa’s sales volume represents an increase of over 35% for Rubis Énergie’s Caribbean zone volume. During the period ended September 30, 2016 the Dinasa Group generated Ebitda of €40.4 million. The acquisition is due to be completed during the second quarter of 2017.

11.2 ACQUISITION OF THE ADDITIONAL 50% OF THE STOCK IN DELTA RUBIS PETROL Under an agreement signed in early January 2017, Rubis purchased 50% of the shares of Delta Rubis Petrol from its partners, to own 100% of the share capital.

The final acquisition of the stock was submitted for approval to the local competition authority and approved in February 2017.

The control of the share capital will give Rubis the full managerial independence necessary to redeploy the facilities, including the construction of an additional 120,000 m3, intended to optimize the use of the capacity to receive vessels on the new jetty.

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