Groupe Renault - 2020 Universal Registration Document

378 GROUPE RENAULT I UNIVERSAL REGISTRATION DOCUMENT 2020 Find out more at group.renault.com 04 CONSOLIDATED FINANCIAL STATEMENTS FINANCIAL STATEMENTS A further impairment test was performed at June 30, 2020 in view of the COVID-19 pandemic situation, using an after-tax discount rate of 5.80% and a growth rate to infinity (including the effect of inflation) of 1.99%. The test result did not lead to recognition of any impairment on the investment in Nissan at June 30, 2020, and it was considered that no reasonably possible change in the main assumptions used should result in a recoverable value lower than the book value of the investment in Nissan. The same applies for the impairment test performed at December 31, 2020 applying an after-tax discount rate of 6.21% and a growth rate to infinity (including the effect of inflation) of 1.71%. Operations between the Groupe Renault 12 - J - and the Nissan group Automotive (excluding AVTOVAZ) and Sales Financing J1 Renault and Nissan follow joint strategies for vehicle and component development, purchasing, production and distribution resources. This cooperation is reflected in synergies that reduce costs. The Automotive (excluding AVTOVAZ) segment is involved in operations with Nissan on two levels: industrial production: crossover production of vehicles and P components in the Alliance’s manufacturing plants: sales by the Groupe Renault to the Nissan group in 2020 totaled P approximately €1,785 million (€3,374 million in 2019), comprising around €1,017 million for vehicles (€2,272 million in 2019), €669 million for components (€985 million in 2019), and €99 million for services (€117 million in 2019). The decrease is mainly driven by sales of vehicles made by Renault Samsung Motors for Nissan North America, and the Nissan Micra made in Flins, France, purchases by Groupe Renault from the Nissan group in 2020 P totaled approximately €1,361 million (€1,896 million in 2019), comprising around €1,000 million for vehicles (€1,046 million in 2019), €277 million for components (€655 million in 2019), and €84 million for services (€195 million in 2019), the balance of Groupe Renault receivables on the Nissan group P is €463 million at December 31, 2020 (€521 million at December 31, 2019) and the balance of Groupe Renault liabilities to the Nissan group is €664 million at December 31, 2020 (€738 million at December 31, 2019); finance: in addition to its activity for Renault, Renault Finance acts P as the Nissan group’s counterparty in financial instruments trading to hedge foreign exchange and interest rate risks. Renault Finance undertook approximately €9.9 billion of forex transactions on the foreign exchange market for Nissan in 2020 (€17 billion in 2019). Operations undertaken with Nissan on foreign exchange and interest rate derivatives are recorded at market price and included in the positions managed by Renault Finance. In the balance sheet, the derivative assets on the Nissan group amount to €36 million at December 31, 2020 (€26 million at December 31, 2019) and derivative liabilities amount to €35 million at December 31, 2020 (€4 million at December 31, 2019). Renault’s Sales Financing segment helps to attract customers and build loyalty to Nissan brands through a range of financing products and services incorporated into the sales policy, principally in Europe. In 2020, RCI Banque recorded €106 million in service revenues in the form of commission and interest received from Nissan (€148 million in 2019). The balance of sales financing receivables from the Nissan group is €68 million at December 31, 2020 (€86 million at December 31, 2019) and the balance of liabilities is €156 million at December 31, 2020 (€184 million at December 31, 2019). The Sales Financing segment signed a term sheet with Nissan Europe to set out the principles for cooperation until March 31, 2025. The Alliance partners hold investments in associates and joint ventures that manage their cooperation. Details of these entities’ activity and location, and the Groupe Renault’s influence over them, are given in note 13. AVTOVAZ J2 In 2020, total sales by AVTOVAZ to Nissan and purchases by AVTOVAZ from Nissan amounted to an estimated €56 million and €15 million respectively (€118 million and €23 million in 2019). In the AVTOVAZ financial position at December 31, 2020, the balances of transactions between AVTOVAZ and the Nissan group consist mainly of: a non-current receivable for jointly controlled assets amounting to P €0 (€25 million at December 31, 2019); operating payables amounting to €14 million (€18 million at P December 31, 2019).