Compagnie Plastic Omnium SE

Quarterly Report • Jul 19, 2019

COMPAGNIE PLASTIC OMNIUM

2019 INTERIM RESULTS REPORT

CONTENTS

	PAGE
DECLARATION BY THE PERSON RESPONSIBLE FOR INTERIM FINANCIAL REPORT	2
INTERIM BUSINESS REPORT	3 - 9
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	10 - 59
STATUTORY AUDITORS' REPORT ON INTERIM FINANCIAL INFORMATION	60 - 62

DECLARATION BY THE PERSON RESPONSIBLE FOR THE INTERIM FINANCIAL REPORT

I declare that, to the best of my knowledge, the condensed interim consolidated financial statements for the past six months have been prepared in accordance with applicable accounting standards and give a true and fair view of the assets, financial position and results of both the Company and all consolidated companies, and that the interim business report herewith presents a true picture of major events occurring during the six months of the fiscal year, of their incidence on financial statements and of the major transactions between related parties, and that it describes the main risks and uncertainties for the remaining six months of the year.

Levallois, July 18, 2019

Laurent Burelle Chairman and CEO

INTERIM BUSINESS REPORT

HIGHLIGHTS OF THE FIRST HALF-YEAR 2019

Technological partnership between Plastic Omnium and HELLA

In January 2019, Plastic Omnium and HELLA launched an innovative project partnership to develop integrated solutions, combining exterior body parts and lighting. Experts in engineering and design from each group, based in Germany, are working together on the development of new concepts incorporating innovative technologies in lighting and in intelligent exterior systems, for both the front and rear of vehicles.

This technological alliance intends to bring to carmakers differentiating solutions in terms of style and functionality for body systems that also assist communications and safety in autonomous cars.

This partnership follows on from the innovative project partnership with the German equipment manufacturer Brose, signed in December 2018, to develop a door system offering new functionalities, innovative styling and ease of assembly.

Launch of two new R&D centers and expansion of ∑-Sigmatech

Two new R&D centers, dedicated to fuel and emission control systems as well as new energies, were commissioned in mid-2019, one in Wuhan (China) and the other in Brussels (Belgium).

The ω-Omegatech center opened in China on June 18. It accommodates 150 engineers and technicians, with headcount that should approach 200 employees by the end of 2019. Specializing in development, testing, prototyping and mechanical testing of fuel systems, it will also carry out testing and development of high pressure hydrogen tanks. The site located in Wuhan, a pilot city for the hydrogen sector in China, is also an engineer training center for new energies. With this new R&D center, already counting 57 development projects, Plastic Omnium is equipped with the means to support its Asian clients' transition to clean mobility. This center will in particular support the Group's rapid growth in China where its fuel systems' market share should double, to reach 17% in 2022.

Δ-Deltatech also opened on July 1 near Brussels airport. Δ-Deltatech is dedicated to fuel and emissions reduction systems. It is also spearheading research and development in new energies, fuel cells and hydrogen storage. Headcount should reach 150 engineers and technicians by the end of the year.

ω-Omegatech and Δ-Deltatech represent an overall investment of €100 million. They also confirm Plastic Omnium's commitment to clean, carbon-free mobility.

The international R&D center ∑-Sigmatech, built in 2003 and dedicated to intelligent exterior systems, has also been extended by nearly 4,000 m2, to provide it with new mechatronic and virtual reality resources.

Openings of five new production and assembly sites

In the first-half of 2019, Plastic Omnium commissioned three new productions plants for its intelligent exterior systems business: Bhamboli in India for Chevrolet, Hlohovec in Slovakia for Jaguar Land Rover and Kenitra in Morocco for the PSA group. Two new sites also began operations in module assembly, one in Mexico for Dodge, the other in Germany for Porsche. These investments strengthen the Group's growth potential.

Strengthened control of the majority shareholder Burelle SA

Between March 12 and March 26, 2019, Burelle SA acquired 400,000 shares of Compagnie Plastic Omnium, bringing its stake from 58.51% to 58.78%. After the strengthening of the Burelle family's controlling interest in Burelle SA in May 2019, the Burelle family's percentage stake in Compagnie Plastic Omnium now stands at 50.17%.

Transformation of Compagnie Plastic Omnium (SA) into a Societas Europaea (SE)

Following the decision of the Board of Directors on February 13, 2019 and the approval of the Shareholders' Meeting on April 25, 2019, Compagnie Plastic Omnium changed its corporate form from a Société Anonyme (SA) to a Societas Europaea (SE).

This transformation will help better reflect the Plastic Omnium Group's European dimension and will boost its international image and attractiveness in the eyes of all the company's stakeholders. The Group is still governed by French laws and regulations and listed on the Paris Stock Exchange. This change of corporate form has no impact on the company's shareholders and employees and will not affect the head office.

CONSOLIDATED INTERIM 2019 RESULTS

In the first-half of 2019, Compagnie Plastic Omnium's economic revenue¹ amounted to €4,611 million, an increase of 20.7% compared to the first half of 2018.

On a like-for-like basis, growth was +0.2%. The Group's economic revenue includes €70 million of positive currency effects and €700 million of positive net scope effects, mainly due to the full consolidation of HBPO from July 1st, 2018 for Plastic Omnium Modules.

Compagnie Plastic Omnium's consolidated revenue² stood at €4,268 million at June 30, 2019, a rise of +33.8% and stable like-for-like.

In € millions by business line	First-half 2018	First-half 2019	Change	Change like-for-like7
Plastic Omnium Industries	3,446	3,458	+0.4%	-1.2%
Plastic Omnium Modules	375	1,153	+207%	+4.7%
Economic revenue1	3,821	4,611	+20.7%	+0.2%
Joint ventures	631	343	-45.7%	+4.5%
Consolidated revenue2	3,190	4,268	+33.8%	-0.1%

Automotive production outperformance of 7.1 points

In the first-half of 2019, worldwide automotive production declined -6.9% (source: IHS July 2019), compared to growth in economic revenue of +0.2% on a like-for-like basis, i.e. an outperformance of 7.1 points, including 5.7 points for Plastic Omnium Industries and 11.6 points for Plastic Omnium Modules.

All regions outperformed automotive production, with a strong outperformance, as forecast, in China (+13.5 points) and in North America (+10.2 points).

In € millions and % of revenue By region	First-half 2018	First-half 2019	Change like for-like 7	Outperformance/ automotive production
Europe/Africa	2,120 55%	2,490 54%	-3.1%	+4.9 points
North America	944 25%	1,311 28%	+7.3%	+10.2 points
Asia, excl. China	293 8%	343 8%	+3.4%	+3.8 points
China	363 9%	385 8%	-0.9%	+13.5 points
South America	101 3%	82 2%	-0.2%	+2.7 points
Economic revenue1	3,821	4,611	+0.2%	+7.1 points

Business in Europe, down 3.1% in the first half of 2019, has been impacted by the sharp drop in automotive production in Germany (-11.4%) and the United Kingdom (-19.8%), which represented 16% and 5% respectively of the Group's revenue. This drop is partially offset by the growth in SCR revenue (diesel vehicle emissions reduction systems, +31%) and by strong business in France (+13%) and Eastern Europe (+15%), particularly in Slovakia (+22%).

North American revenues grew strongly (+7.3% like-for like) and benefited from the ramp up of new American and Mexican plants recently commissioned as well as the high exposure to SUV/Light Truck models which represented 80% of its business.

In China, business was virtually stable (-0.9% like-for like) while automotive production fell by -14.4%. The Group's strong market share gains in the leading worldwide automotive market are the result of many new model launches: China today represents nearly half of the Group's launches.

In Asia excluding China, Plastic Omnium performed well in South Korea and Turkey.

Cost structure and change

The change in cost structure between the first half of 2018 and the first-half of 2019 was marked by the full consolidation, as of July 1st, 2018, of HBPO, with an assembly business where 90% of the costs are parts and components purchases.

Consolidated gross margin was €539.6 million, versus €530.7 million in the first-half of 2018. This represents 12.6% of revenue, compared with 16.6% in the first-half of 2018.

In gross value, research and development costs were stable at €200.9 million, compared with 204.7 million euros in the first-half of 2018. In net value, i.e. after capitalization and rebilling to customers, expenditure amounted to €121.5 million, versus €96.4 million in the first-half of 2018. This represents 2.8% of revenue, compared with 3.0% in the first-half of 2018.

Selling expenses totaled €19.2 million or 0.4% of revenue, compared with €20.3 million or 0.6% of revenue in first-half of 2018.

Administrative expenses totaled €124.8 million in the first-half of 2019, compared with €119.9 million in the first-half of 2018, representing 2.9% and 3.8% of revenue respectively.

Drop in operating margin, growth in EBITDA

To respond to the deterioration in worldwide automotive production, Plastic Omnium launched a cost reduction plan in the 4th quarter of 2018, which was strengthened in the 1st quarter of 2019, for a fullyear amount of €100 million, including €50 million of savings in indirect production and structural costs.

These cost saving plans enabled the Group's operating margin to withstand the drop in worldwide automotive production and to offset the extra depreciation related to new plant launches and numerous program launches to support the Group's growth. Thus, depreciation (excluding IFRS 168) increased by €64 million between the first-half of 2018 and the first-half of 2019.

The operating margin thus came in at €281 million, i.e. 6.6% of consolidated revenue, in the first-half of 2019. It declined 13% compared to the €324 million in the first-half of 2018 (10.2% of consolidated revenue) and is comparable to the €286 million achieved in the second-half of 2018 (7.1% of consolidated revenue), in tougher market conditions. EBITDA increased from €457 million to €511 million between the first-half of 2018 and the first-half of 2019.

The full consolidation of HBPO from July 1st, 2018 into PO Modules, a less capital-intensive assembly business, had, as expected, a dilutive impact on the operating margin percentage and on EBITDA.

in € millions	First-half 2018	Second-half 2018	First-half 2019
Consolidated revenue	3,190	4,055	4,268
PO Industries	3,190	3,098	3,207
PO Modules	0	957	1,062
Operating margin	324	286	281
as a % of revenue	10.2%	7.1%	6.6%
PO Industries	315	263	254
as a % of revenue	9.9%	8.5%	7.9%
PO Modules	9	24	27
as a % of revenue	N/A	2.5%	2.5%
EBITDA	457	461	511
as a % of revenue	14.3%	11.4%	12.0%
PO Industries	448	417	457
as a % of revenue	14.1%	13.4%	14.2%
PO Modules	9	44	54
as a % of revenue	N/A	4.7%	5.1%

By business, the change in Operating Margin and EBITDA is as follows:

Net profit, Group share: €155 million

In the first-half of 2019, Plastic Omnium recognized €25 million of net non-current expenses (€9.9 million in net expenses in the first-half of 2018), mainly comprising restructuring charges to respond to the drop in worldwide automotive production.

Net financial income was stable at -€36.9 million.

Income tax stood at -€55.6 million, i.e. an effective tax rate of 28%, versus -€50.9 million at June 30, 2018 (effective tax rate of 21%).

Net income was €163.5 million (i.e. 3.8% of consolidated revenue), versus €232.7 million in the first-half of 2018.

Net profit, Group share, dropped 33% to €155 million (i.e. 3.6% of consolidated revenue) compared to the first-half 2018 record level (€230 million).

Free cash-flow of €30 million after a final quarter of heavy investment

In the first-half of 2019, the Group invested at a high level of €308 million, i.e. 7.2% of consolidated revenue. These investments included:

• four plants for the Intelligent Exterior Systems business in the United States, Slovakia, India and Morocco;
• three R&D centers, including two for the Clean Energy Systems business (Belgium and China) and the extension and digitization of ∑-Sigmatech for Intelligent Exterior Systems, opened in June 2019.

With this high level of investment, the Group generated €30 million in free cash flow at June 30, 2019.

In the second-half of 2019, the Group will not commission any significant plants or finance any additional R&D centers; investments will thus be sharply reduced. They will represent approximately 6% of consolidated revenue for the whole of 2019.

Sound financial structure

Net debt at June 30, 2019 stood at €1,021 million, i.e. approximately the same level as at June 30, 2018 (€992 million), after a +€234 million impact from the changeover to IFRS 16⁸ in 2019. In the meantime, Plastic Omnium paid €123 million in dividends, purchased €50 million of Treasury shares and sold its Environment business for €220 million (December 2018).

The Group's net debt represents 46% of shareholders' equity and 1.1x EBITDA.

RELATED PARTIES

Related party transactions correspond to transactions with Sofiparc, Burelle SA and Burelle Participations. No changes occurred in the contracts between the Group and these companies during the period.

No material change has been made to the compensation paid to senior executives and officers since December 31, 2018.

OUTLOOK

In expectation of an estimated 4.5% drop in worldwide automotive production for full-year 2019 (an estimated production of around 87 million vehicles in 2019 versus 91.3 million in 2018), Plastic Omnium strengthened its cost reduction plan.

In these market conditions, the Group is confirming outperformance of its businesses of at least 5 points compared to worldwide automotive production in full-year 2019, as well as free cash-flow generation of around €200 million. It is revising its operating income forecast, now expected to decrease slightly compared to the €610 million achieved in 2018. 2019 EBITDA will show an increase compared to 2018 EBITDA.

Furthermore, on the basis of an independent valuation, Plastic Omnium expects to sell its commercial real estate assets to the real estate company Sofiparc, wholly-owned by Burelle SA which is also the holding company controlling Plastic Omnium. This transaction would enable the non-industrial real estate assets of Plastic Omnium to be rationalized and strengthen its financial structure.

The Group does not expect a rebound in worldwide automotive production in 2020 or 2021. On this basis and over this period, it is confirming outperformance of its businesses of around 5 points and generation of annual free cash-flow greater than €200 million.

With a sound financial structure and strengthened fundamentals, Plastic Omnium will consolidate its leadership as an innovative automotive supplier in clean and connected cars.

RISKS OVER THE SECOND HALF-YEAR

The risk factors for Compagnie Plastic Omnium remain those identified in the Group's management report as at end-December 2018.

Glossary

• (1) The economic revenue reflects the Group's operational and managerial reality. It corresponds to the consolidated sales plus the sales of the Group's joint ventures at the Group's percentage stake: BPO (50%) and YFPO (50%) and HBPO for 33.33% until its full consolidation on July 1st, 2018.
• (2) Consolidated revenue, pursuant to IFRS 10-11-12, does not include the share of joint ventures, which are consolidated using the equity method.
• (3) The operating margin includes the share of the results of companies which have been consolidated using the equity method, and the amortization of the intangible assets acquired, before other operating income and expenses.
• (4) EBITDA corresponds to the operating margin plus the share of profit of associates and joint ventures before depreciation and operating provisions.
• (5) Free cash flow corresponds to the operating cash-flow, less tangible and intangible investments net of disposals, taxes and net interest paid +/- variation of the working capital requirements (cash surplus from operations).
• (6) Net debt includes all long-term borrowings, short-term loans and bank overdrafts less loans, marketable debt instruments and other non- current financial assets, and cash and cash equivalents.

(7) Like-for-like (scope and exchange):

• a. the currency effect is calculated by applying the exchange rate of the previous period to the revenue of the current period. In the first-half of 2019, it is a positive €69.5 million on economic revenue and €72.7 million on consolidated revenue;
• b. the scope effect is calculated by applying the consolidation method of the current period to the previous period. The full consolidation of HBPO into Plastic Omnium Modules thus impacted economic revenue by +€704.8 million and consolidated revenue by +€1,010 million in the first-half of 2019.
• (8) The Group has applied IFRS 16 "Leases" since January 1st, 2019. At June 30, 2019, it impacted property, plant and equipment and financial liabilities by +€234 million and depreciation and EBITDA by +€26 million.

CONSOLIDATED FINANCIAL STATEMENTS AT JUNE 30, 2019

Financial indicators

In the context of its financial communication, the Group uses financial indicators based on aggregates taken from the consolidated financial statements prepared in accordance with IFRS, as adopted in the European Union.

As indicated in Note 3.1 on segment information of the consolidated financial statements at June 30, 2019, the Group uses the notion of "economic revenue" for its operational management, which corresponds to the consolidated revenue of the Group and its joint ventures at their ownership percentage: Yanfeng Plastic Omnium, the Chinese leader in exterior body parts, SHB Automotive modules leading Korean front-end module company (Samlip) and BPO a major player in the Turkish market for exterior equipment.

Reconciliation of economic revenue with consolidated revenue:

In thousands of euros	First-half 2019	First-half 2018
Economic revenue	4,610,965	3,820,869
Including revenue from joint ventures at the Group's percentage stake	342,713	631,243
Consolidated revenue	4,268,252	3,189,626

BALANCE SHEET

In thousands of euros
	Notes	June 30, 2019	December 31, 2018
ASSETS
Goodwill	5.1.1	1,016,390	1,015,730
Other intangible assets		733,567	728,150
Property, plant and equipment	5.1.2	1,930,275	1,653,028
Investment property	5.1.3	93,289	93,263
Equity method and non-consolidated investments	5.1.4	181,587	193,212
Other non-current financial assets(1) Deferred tax assets	5.2.5.5	67,338 104,730	65,775 101,691
TOTAL NON-CURRENT ASSETS		4,127,175	3,850,849
Inventories		810,633	737,109
Finance receivables(1)	5.1.6 5.1.7 - 5.2.5.5	14,006	22,504
Trade receivables	5.1.8.2 - 5.1.8.4 - 6.2.1	975,803	815,300
Other receivables		318,618	370,612
Other financial assets and financial receivables(1)	5.1.8.3 - 5.1.8.4	59,014	63,942
Hedging instruments(1)	5.1.7 - 5.2.5.5	3,724	1,898
Cash and cash equivalents(1)	5.2.5.5 - 5.2.6 5.1.9 - 5.1.9.2 - 5.2.5.5	803,635	916,336
TOTAL CURRENT ASSETS		2,985,433	2,927,701
Assets held for sale		846	846
TOTAL ASSETS		7,113,454	6,779,396
EQUITY AND LIABILITIES
Capital	5.2.1.1	8,914	8,914
Treasury stock		-54,230	-49,850
Additional paid-in capital		17,389	17,389
Consolidated reserves		2,006,831	1,576,112
Net income for the period		155,006	533,296
EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT		2,133,911	2,085,861
Attributable to non-controlling interests		90,955	96,138
TOTAL EQUITY		2,224,865	2,181,999
Non-current borrowings(1)	5.2.5.5	1,338,166	1,635,811
Provisions for pensions and other post-employment benefits	5.2.4	98,557	105,184
Provisions for liabilities and charges	5.2.4	34,903	35,592
Non-current grants		6,242	6,323
Deferred tax liabilities		77,248	80,718
TOTAL NON-CURRENT LIABILITIES		1,555,116	1,863,628
Bank overdrafts(1)	5.2.5.5 - 5.1.9.2 - 6.3	7,461	4,684
Current borrowings and financial debt(1)	5.2.5.5	620,605	123,215
Other current financial debt(1)	5.2.5.5 - 6.3	67	31
Hedging instruments(1)	5.2.5.5 - 5.2.6 - 6.3	2,357	4,330
Provisions for liabilities and charges	5.2.4	50,101	55,120
Current grants		4,069	3,994
Trade payables	5.2.7.1 - 5.2.7.3	1,671,797	1,614,989
Other operating liabilities	5.2.7.2 - 5.2.7.3	977,015	927,406
TOTAL CURRENT LIABILITIES		3,333,472	2,733,769
TOTAL EQUITY AND LIABILITIES		7,113,454	6,779,396

(1) Components of net debt. Net debt stands at € 1,020.9 million at June 30, 2019 compared with €697.6 million at December 31, 2018 (see Note 5.2.5.5).

INCOME STATEMENT

In thousands of euros	Notes	First-half 2019	%	First-half 2018	%
Consolidated sales (revenue)		4,268,252	100.0%	3,189,626	100.0%
Cost of goods and services sold	4.2	-3,728,693	-87.4%	-2,658,967	-83.4%
Gross profit		539,559	12.6%	530,659	16.6%
Net research and development costs Selling costs	4.1 - 4.2 4.2	-121,523 -19,207	-2.8% -0.4%	-96,419 -20,350	-3.0% -0.6%
Administrative expenses	4.2	-124,776	-2.9%	-119,912	-3.8%
Operating margin before amortization of intangible assets acquired in business combinations and before share of profit of associates and joint ventures		274,052	6.4%	293,978	9.2%
Amortization of intangible assets acquired in business combinations	4.3	-13,583	-0.3%	-4,882	-0.2%
Share of profit/loss of associates and joint ventures(1)	4.4	20,524	0.5%	34,675	1.1%
Operating margin		280,993	6.6%	323,771	10.2%
Other operating income Other operating expenses	4.5 4.5	22,409 -47,364	0.5% -1.1%	29,475 -39,393	0.9% -1.2%
Financing costs, net	4.6	-38,651	-0.9%	-33,635	-1.1%
Other financial income and expenses, net	4.6	1,706	0.0%	-3,161	-0.1%
Profit from continuing operations before income tax and after share of profits of associates and joint ventures		219,093	5.1%	277,057	8.7%
Income tax	4.7	-55,599	-1.3%	-50,900	-1.6%
Net income after tax from continuing operations		163,494	3.8%	226,157	7.1%
Net income after income tax from discontinued activities(2)		-	-	6,575	0.2%
Net income		163,494	3.8%	232,732	7.3%
Net profit attributable to non-controlling interests	4.8	8,488	0.2%	2,632	0.1%
Net profit attributable to owners of the parent company		155,006	3.6%	230,100	7.2%
Earnings per share attributable to owners of the parent company Basic earnings per share (in euros)(3) Diluted earnings per share (in euros)(4)	4.9	1.06 1.06		1.56 1.55

(1) At June 30, 2018, the share of HBPO's profit, i.e. €8.7 million, corresponded to 33.33% of its profit, i.e. the Group's ownership percentage before the acquisition of an additional 33.33% of HBPO. Since the takeover on July 1, 2018, HBPO has been fully consolidated.

(2) The "Environment" Division's business (sold on December 18, 2018) in the income statement was presented on a single line as of June 30, 2018 in accordance with IFRS 5 "Non-current assets held for sale and discontinued operations".

(3) Basic earnings per share are calculated using the weighted average number of ordinary shares outstanding, less the average number of shares held in treasury stock.

(4) Diluted earnings per share take into consideration the average number of treasury shares deducted from equity and shares which might be issued under stock option programs.

STATEMENT OF COMPREHENSIVE INCOME

In thousands of euros	First-half 2019			First-half 2018
	Total	Gross	Tax	Total	Gross	Tax
Net profit for the period attributable to owners of the parent (1)	155,006	207,440	-52,434	230,100	280,246	-50,147
Reclassified to the income statement	6,351	6,516	-165	-8,453	-9,902	1,449
Reclassified in the period	175	191	-16	286	413	-127
Exchange differences on translating foreign operations - reclassified to the income statement	-	-	-	-	-	-
Cash flow hedges - Interest rate instruments reclassified to the income statement	175	191	-16	286	413	-127
Reclassified at a later date	6,176	6,325	-149	-8,739	-10,315	1,576
Exchange differences on translating foreign operations	5,850	5,850	-	-3,998	-3,998	-
Cash flow hedges	326	475	-149	-4,741	-6,317	1,576
Gains/(losses) for the period - Interest rate instruments Gains/(losses) for the period – Exchange rate instruments	- 326	- 475	- -149	- -4,741	- -6,317	- 1,576
Cannot be reclassified to the income statement at a later date	1,435	-857	2,292	-1,713	-1,728	15
Actuarial gains/(losses) recognized in equity	-5,737	-8,029	2,292	271	256	15
Adjustment for change in fair value of long-term investments in equity instruments and funds	7,172	7,172	-	-1,984	-1,984	-
Profit/loss from continuing activities recognized directly in equity	7,786	5,659	2,127	-10,166	-11,630	1,464
Comprehensive income attributable to owners of the parent(2)	162,792	213,099	-50,307	219,934	268,616	-48,683
Net profit for the period attributable to non-controlling interests	8,488	11,653	-3,165	2,632	3,385	-753
Reclassified to the income statement	1,451	1,451	-	-399	-399	-
Reclassified at a later date	1,451	1,451	-	-399	-399	-
Exchange differences on translating foreign operations	1,451	1,451	-	-399	-399	-
Other comprehensive income	1,451	1,451	-	-399	-399	-
Comprehensive income attributable to non-controlling interests	9,939	13,104	-3,165	2,233	2,986	-753
Total comprehensive income	172,731	226,203	-53,472	222,167	271,602	-49,436

(1) Net profit for the period attributable to owners of the parent amounted to €92,632 thousand at June 30, 2019 compared with €135,574 thousand at June 30, 2018.

(2) Net comprehensive income for the period attributable to owners of the parent amounted to €97,284 thousand at June 30, 2019 compared with €129,585 thousand at June 30, 2018.

CHANGES IN EQUITY

In thousands of euros In thousand units for the number of shares

Shareholders' equity

	Number of		Additional paid-in	Treasury	Other		Translation	Net profit for the	Attributable to owners of the parent	Attributable to non controlling interests
Equity at December 31, 2017	shares 150 977	Capital 9 059	capital 17 389	stock -61 764	reserves 1 366 568 (1)	(1) adjustment	-28 809	period 425 177	1 727 620	26 614	Total equity 1 754 234
1st application of IFRS 15(*)					-4 818				-4 818	30	-4 788
1st application of IFRS 9(*)					-1 939				-1 939		-1 939
Equity at January 1, 2018(*)	150 977	9 059	17 389	-61 764	1 359 811 (1)		-28 809	425 177	1 720 863	26 644	1 747 507
Appropriation of net profit at December 31, 2017	-	-	-	-	425 177		-	-425 177	-	-	-
Net profit at June 30, 2018	-	-	-	-	-		-	230 100	230 100	2 632	232 732
Profit/loss from continuing activities recognized directly in	-	-	-	-	-1 136		-9 030	-	-10 166	-399	-10 565
equity Exchange differences on translating foreign operations	-	-	-	-	5 032		-9 030	-	-3 998	-399	-4 397
Actuarial gains/(losses) recognized in equity	-	-	-	-	271		-	-	271	-	271
Cash flow hedges - Interest rate instruments	-	-	-	-	286		-	-	286	-	286
Cash flow hedges - currency instruments	-	-	-	-	-4 741		-	-	-4 741	-	-4 741
Adjustments for changes in fair value of property, plant	-	-	-	-	-1 984		-	-	-1 984	-	-1 984
and equipment Comprehensive income	-	-	-	-	424 041		-9 030	-195 077	219 934	2 233	222 167
Treasury stock transactions	-	-	-	-27 578	2 089		-	-	-25 489	-	-25 489
Dividends paid by Compagnie Plastic Omnium	-	-	-	-	-98 822		-	-	-98 822	-	-98 822
Dividends paid by other Group companies	-	-	-	-	-		-	-	-	-389	-389
Stock option costs	-	-	-	-	1 274		-	-	1 274	-	1 274
Deferred tax on stock option and share purchase plans	-	-	-	-	145		-	-	145	-	145
Equity at June 30, 2018(*)	150 977	9 059	17 389	-89 342	1 688 538 (1)		-37 839	230 100	1 817 905	28 488	1 846 393
Net profit of the second-half 2018	-	-	-	-	-		-	303 196	303 196	6 849	310 045
Other comprehensive income	-	-	-	-	13 732		-3 658	-	10 074	-740	9 334
Exchange differences on translating foreign operations	-	-	-	-	675		-3 658	-	-2 983	-726	-3 709
Actuarial gains/(losses) recognized in equity	-	-	-	-	1 436		-	-	1 436	-14	1 422
Cash flow hedges - Interest rate instruments	-	-	-	-	-1 516		-	-	-1 516	-	-1 516
Cash flow hedges - currency instruments	-	-	-	-	1 935		-	-	1 935	-	1 935
Change in the fair value adjustment of long-term	-	-	-	-	2 350		-	-	2 350	-	2 350
investments in equity instruments and in funds
Revaluation of assets and liabilities due to hyperinflation in Argentina	-	-	-	-	8 852		-	-	8 852	-	8 852
Comprehensive income	-	-	-	-	13 732		-3 658	303 196	313 270	6 109	319 379
Treasury stock transactions	-	-	-	-43 137	-2 089		-	-	-45 226	-	-45 226
Capital reduction (cancellation of treasury stock)	-2 411	-145	-	82 629	-82 629		-	-	-145	-	-145
Change in scope of consolidation and reserves	-	-	-	-	-		-	-	-	62 884	62 884
Dividends paid by other Group companies	-	-	-	-	-		-	-	-	-1 344	-1 344
Stock option costs	-	-	-	-	1 254		-	-	1 254	-	1 254
Deferred tax on stock option and share purchase plan	-	-	-	-	-1 197		-	-	-1 197	-	-1 197
Equity at December 31, 2018	148 566	8 914	17 389	-49 850	1 617 609 (1)		-41 497	533 296	2 085 861	96 138	2 181 999
1st application of IFRS 16	-	-	-	-	-		-	-	-	-	-
1st application of IFRIC 23	-	-	-	-	-2 500		-	-	-2 500	-	-2 500
Equity at January 1, 2019	148 566	8 914	17 389	-49 850	1 615 109		-41 497	533 296	2 083 361	96 138	2 179 499
Appropriation of net profit at December 31, 2018	-	-	-	-	533 296		-	-533 296	-	-	-
Net profit at June 30, 2019	-	-	-	-	-		-	163 494	155 006	8 488	163 494
Other comprehensive income	-	-	-	-	-660		8 446	-	7 786	1 451	9 237
Exchange differences on translating foreign operations	-	-	-	-	-2 596		8 446	-	5 850	1 451	7 301
Actuarial gains/(losses) recognized in equity	-	-	-	-	-5 737		-	-	-5 737	-	-5 737
Cash flow hedges - Interest rate instruments	-	-	-	-	175		-	-	175	-	175
Cash flow hedges - Currency instruments	-	-	-	-	326		-	-	326	-	326
Change in the fair value adjustment of long-term	-	-	-	-	7 172		-	-	7 172	-	7 172
investments in equity instruments and in funds Comprehensive income	-	-	-	-	532 636		8 446	-369 802	162 792	9 939	172 731
Treasury stock transactions	-	-	-	-4 380	-877		-	-	-5 257	-	-5 257
Dividends paid by Compagnie Plastic Omnium	-	-	-	-	-108 168		-	-	-108 168	-	-108 168
Dividends paid by other Group companies	-	-	-	-	-		-	-	-	-15 121	-15 121
Stock option and share purchase plan costs	-	-	-	-	1 141		-	-	1 141	-	1 141
Deferred tax on stock option and share purchase plans	-	-	-	-	43		-	-	43	-	43
Equity at June 30, 2019	148 566	8 914	17 389	-54 230	2 039 884 (1)		-33 051	163 494	2 133 911	90 955	2 224 865

(*) The IFRS 15 and IFRS 9 impacts are the definitive impact as of December 31, 2018. The shareholders' equity at June 30, 2018 is adjusted for the variation between July and December 2018 of this 1st application and as such, differ from those published on June 30, 2018.

(1) See Note 5.2.1.2 for breakdown of "Other reserves".

STATEMENT OF CASH FLOWS

In thousands of euros	Notes	First-half 2019	2018	First-half 2018
I - CASH FLOWS FROM OPERATING ACTIVITIES
Net income	3.1.1	163,494	542,777	232,732
Dividends received from associates and joint ventures		19,011	40,973	27,791
Non-cash items		281,669	212,959	161,161
Net income from discontinued operations		-	-1,494	-6,575
Share of profit/(loss) of associates and joint ventures	4.4	-18,609	-51,888	-34,675
Stock option plan expense Other adjustments(1)		1,141 -4,811	2,528 -259,331	1,274 7,971
Depreciation and provisions for impairment of fixed assets	3.1.3	140,763	202,740	85,609
Amortization and provisions for impairment of intangible assets	3.1.3	95,685	163,353	59,373
Changes in provisions		-20,764	-22,075	-36,612
Net (gains)/losses on disposals of non-current assets Operating grants recognized in the income statement		191 -480	1,210 -1,407	2,630 -905
Current and deferred taxes	4.7.1	55,602	112,995	50,899
Interest expense		32,952	66,328	32,171
CASH GENERATED BY OPERATIONS (A)		464,174	796,709	421,684
Change in inventories and work-in-progress – net		-71,139	-23,074	-76,779
Change in trade receivables – net		-111,434	180,442	-20,123
Change in trade payables		121,888	-8,097	101,942
Change in other operating assets and liabilities - net		7,925	-17,177	36,229
CHANGE IN WORKING CAPITAL REQUIREMENTS (B)		-52,760	132,094	41,268
TAXES PAID (C)		-30,383	-82,765	-42,831
Interest paid		-44,547	-71,053	-41,092
Interest received		1,587	4,641	1,229
NET FINANCIAL INTEREST PAID (D)		-42,960	-66,412	-39,863
NET CASH GENERATED BY OPERATING ACTIVITIES (A+B+C+D)		338,071	779,626	380,258
II – CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of property, plant and equipment	3.1.3	-167,050	-434,327	-181,407
Acquisitions of intangible assets	3.1.3	-102,957	-208,452	-97,797
Disposals of property, plant and equipment		2,901	4,842	391
Disposals of intangible assets		4,265	996	-
Net change in advances to suppliers of fixed assets		-45,385	74,131	6,468
Government grants received		441	1,172	1,118
NET CASH USED IN OPERATIONS-RELATED INVESTING ACTIVITIES (E)		-307,786	-561,639	-271,227
FREE CASH FLOW (A + B + C + D + E)		30,286	217,988	109,031
Acquisitions of shares in subsidiaries and associates, investments in		-	-369,543	217
associates and joint ventures, and related investments(2)
Acquisitions of non-consolidated equity instruments(3)	5.1.4	-309	-3,000	-372,762
Acquisitions of long-term Investments in equity instruments and in funds		-9,885	-1,000	-1,000
Proceeds from disposals of investments in subsidiaries and associates(4) Disposals of non-consolidated equity instruments		- -	200,166 -	767 20
Disposals of long term investments in listed equity instruments and in funds		8,485	-	-
Impact of changes in scope of consolidation - cash and cash equivalents contributed by companies entering		-	26,847	-
the scope of consolidation
NET CASH FROM FINANCIAL INVESTING ACTIVITIES (F)		-1,709	-146,530	-372,759
NET CASH FROM INVESTING ACTIVITIES (E+F)		-309,495	-708,169	-643,986
III - CASH FLOWS FROM FINANCING ACTIVITIES
Increases/reductions in share capital and premiums		-	-145	-
Purchases/sales of treasury stock		-5,257	-70,715	-25,485
Dividends paid by the Compagnie Plastic Omnium to Burelle SA		-64,619	-58,238	-58,238
Dividends paid to other shareholders(5)		-58,672	-42,317	-40,974
Increase in financial debt		204,996	385,283	42,233
Repayment of financial debt		-222,565	-306,390	-79,205
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES (G)		-146,118	-92,522	-161,668
Assets held for sale (and discontinued operations) (H)(6) Effect of exchange rate changes (I)		- 2,061	15,059 -7,228	-14,910 -3,288
NET CHANGE IN CASH AND CASH EQUIVALENTS
(A + B + C + D + E + F + G + H + I)		-115,479	-13,232	-443,596
NET CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	5.1.9.2 - 5.2.5.5	911,652	924,884	924,884
CASH AND CASH EQUIVALENTS AT END OF PERIOD	5.1.9.2 - 5.2.5.5	796,174	911,652	481,288

(1) At the end of 2018, this item included the revaluation of €255,000 thousand relating to the 33.33% equity share held in HBPO prior to the acquisition based on its fair value .

(2) At the end of 2018, the amount of €369,762 thousand related to Mahle-Behr's 33.33 % equity stake in HBPO and after the takeover.

(3) At the end of the 1st Semester 2018, the amount included the Group's acquisition of Mahle-Behr's 33.33 % equity stake in HBPO on June 26, 2018 for €369,762 thousand and before the takeover.

(4) This caption included at the end of 2018, the sale of the Environment Division.

(5) During the First-half 2019, the €43,549 thousand in dividends paid to other shareholders (compared with €40,584 thousand in 2018) was paid by Compagnie Plastic Omnium, bringing the total dividends paid by Compagnie Plastic Omnium to €108,168 thousand (compared with €98,822 thousand in 2018). See Note 5.2.2 "Dividends voted and paid by Compagnie Plastic Omnium".

(6) The amounts in this section in the two periods of 2018 corresponded to the results of the Environment Division.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The condensed consolidated financial statements of the Plastic Omnium Group for the six months ended June 30, 2019 were approved by the Board of Directors on July 18, 2019.

PRESENTATION OF THE GROUP

Compagnie Plastic Omnium, a company governed by French law, was set up in 1946. The bylaws set its duration until April 24, 2112. It is registered in the Lyon Trade and Companies Register under number 955 512 611 and its registered office is at 19, boulevard Jules Carteret, 69007 Lyon, France.

The terms "Compagnie Plastic Omnium", "the Group" and "the Plastic Omnium Group" refer to the group of companies comprising Compagnie Plastic Omnium and its consolidated subsidiaries.

The Plastic Omnium Group is a global leader in the transformation of plastic materials for the automotive market for body parts, storage systems and fuel supply systems ("Industries" segment) and front-end modules ("Modules" segment).

Following the disposal of the Environment Division which represented a separate business segment, on December 18 2018, the Group has organized its business into two operating segments since the end of year 2018 as follows :

Industries:

• oIntelligent Exterior Systems, dedicated to complex and intelligent body systems, replacing the former "Auto Exterior" terminology;
• oClean Energy Systems, dedicated to clean energy storage systems, replacing the former "Fuel Systems" terminology.
• Modules: front end module design, development and assembly.

Plastic Omnium Group shares have been traded on the Paris Stock Exchange since 1965. The Group has been traded on Eurolist subfund A since January 17, 2013 and is listed on the SBF 120 and the CAC Mid 60 indices. The main shareholder is Burelle SA, which held 58.78% of the Group at June 30, 2019 (59.76% excluding treasury stock).

The unit of measurement used in the Notes to the consolidated financial statements is thousand euros, unless otherwise indicated.

1. ACCOUNTING POLICIES, ACCOUNTING RULES AND PRINCIPLES

1.1. Basis of preparation

The condensed consolidated financial statements for the six months ended June 30, 2019 have been prepared in accordance with IAS 34 "Interim Financial Reporting".

These condensed interim consolidated financial statements do not include all the information required for annual financial statements and should be read in conjunction with the consolidated financial statements at December 31, 2018.

The accounting policies used are those applied by the Group at December 31, 2018 and described in Note 1 "Accounting policies, accounting rules and principles" of the 2018 consolidated financial statements, with the exception of IFRIC 23 interpretation "Uncertainty over income tax treatments " (not significant for the Group: see "Changes in equity" and Note 5.2.7.2 "Other operating liabilities") and IFRS 16 "Leases", which the Group has been applying since January 1, 2019.

The Group has chosen to apply the IFRS 16 simplified retrospective method for the transition at January 1, 2019: the 2018 consolidated financial statements are not restated and the new accounting treatment is applied to leases in progress at January 1, 2019.

The two capitalization exemptions proposed by the standard for contracts with an initial duration of less than or equal to twelve months and assets with a low value when new, which the Group has defined as being less than or equal to €5,000, were used.

The main changes induced by IFRS 16 are as follows:

• recognition from January 1, 2019, as property, plant and equipment, of right-of-use leased assets under leases that meet the capitalization criteria defined by IFRS 16;
• recognition from January 1, 2019 of a financial liability for the obligation to pay rent during the term of these leases;
• recognition of an amortization expense for the right to use the asset and a financial expense relating to the interest on the lease debt, which partly replace the operating expense previously recognized in respect of rents;
• improvement in cash flow from operations and increase in cash flows from financing transactions.

As part of the implementation of this new standard, the Group measures whether a contract is a lease under IFRS 16 by assessing, at the date of entry of the said contract, whether the latter relates to a specific asset, whether the Group obtains substantially all the economic benefits associated with the use of the asset and has the ability to control the use of this asset.

The Group has implemented a tool to perform, for each contract complying with the IFRS 16 capitalization criteria, an evaluation of the rights-of-use and the related financial debt in accordance with IFRS 16. The lease term used corresponds to the duration of the lease contract, taking into account an option to renew or terminate when its exercise is reasonably certain. The discount rate used to calculate the rent debt is determined, for each property, according to the marginal rate of debt at the date of commencement of the contract. This rate corresponds to the interest rate that the lessee would obtain at inception of the lease to finance the acquisition of the leased property. This rate is obtained by adding the rate for government bonds with durations similar to the leased goods and the credit spread of the entity.

The amount recognized as of January 1, 2019 in rights-of-use and financial debt amounts to €230.2 million. It covers 86% of real estate rentals for industrial sites, storage and administrative premises, the balance mainly corresponds to industrial equipment and vehicles (see Notes 2.1.1 in "Significant events of the period" and 5.1.2 "Property, plant and equipment – Right-of-use leased assets"). The rights of use relating to the assets leased at January 1, 2019 contribute 11.6% to the net fixed assets of the Group.

The impact of the restatement at the date of application of the standard has no impact on the cash flow statement, as these items have no impact on cash and cash equivalents.

The Group has not early applied any standards, interpretations and amendments that are not mandatory at January 1, 2019.

1.2. Preparation of interim financial statements

Income tax

The tax expense (current and deferred) for the period is determined based on the estimated annual tax rate, applied to profit before tax for the period excluding significant non-recurring items.

Employee benefits

The decrease in interest rates in the first half of 2019 led the Group to reassess its employee benefits obligations in the Euro and U.S. zones. The rates used at June 30, 2019 are:

• 1% for the euro zone (1.6% at December 31, 2018); and
• 3.7% for the United States (4.45% at December 31, 2018).

In 2019, the Group opted for a "defined contribution" plan for the remaining U.S. subsidiaries that had a "defined benefit" plan (see Notes 4.5 "Other operating income and expenses" and 5.2.4 "Provisions").

The semester charge for post-employment benefits corresponds to half of the budgeted net expense for the 2019 financial year, determined on the basis of the actuarial data and assumptions used at December 31, 2018, after taking into account, where applicable, special events such as plan changes.

Seasonality of activity

Plastic Omnium Group's business is not seasonal in nature.

Goodwill impairment testing

At June 30, 2019, as no indications of impairment had been identified by the Group, in particular given the level of business and profitability over the period and the outlook, no impairment tests were carried out on goodwill.

1.3. Use of estimates and assumptions

In preparing its financial statements, the Plastic Omnium Group uses estimates and assumptions to assess some of its assets and liabilities. The estimates and assumptions that may lead to a material adjustment to the carrying amount of assets and liabilities at June 30, 2019 mainly concerned deferred taxes and goodwill.

Goodwill is subject to an annual impairment test as part of the annual closing of the consolidated financial statements, prepared at each business segment level but also when there is an indication of impairment. The tests carried out by the Group are based on the value in use, which is calculated as the present value of future cash flows.

1. SIGNIFICANT EVENTS OF THE PERIOD

2.1. Application of the new IFRS standards effective from January 1, 2019

2.1.1. First application of IFRS 16 "Leases", IFRIC 23 "Uncertainty over income tax treatments" and impacts on the Group's consolidated financial statements

The Group has applied IFRS 16 "Leases" and IFRIC 23 interpretation "Uncertainty over income tax treatments" since January 1, 2019. See Notes 1 "Accounting policies, accounting rules and principles" and 5.1.2 "Property, plant and equipment - Right-of-use leased assets".

The impacts on the Group's consolidated financial statements are shown below :

In thousands of euros	Notes	December 31, 2018	IFRS 16	IFRIC 23	January 1, 2019
ASSETS
Goodwill		1,015,730	-	-	1,015,730
Intangible assets		728,150			728,150
Property, plant and equipment	5.1.2	1,653,028	230,233	-	1,883,261
Investment property		93,263	-	-	93,263
Equity method and non-consolidated investments		193,212	-	-	193,212
Other non-current financial assets		65,775	-	-	65,775
Deferred tax assets		101,691	-	-	101,691
TOTAL NON-CURRENT ASSETS		3,850,849	230,233	-	4,081,082
Inventories		737,109	-	-	737,109
Finance receivables		22,504	-	-	22,504
Trade receivables		815,300	-	-	815,300
Other receivables		370,612	-	-	370,612
Other financial assets and financial receivables		63,942	-	-	63,942
Hedging instruments		1,898			1,898
Cash and cash equivalents		916,336	-	-	916,336
TOTAL CURRENT ASSETS		2,927,701	-	-	2,927,701
Assets held for sale		846	-	-	846
TOTAL ASSETS		6,779,396	230,233	-	7,009,629
EQUITY AND LIABILITIES
Capital		8,914	-	-	8,914
Treasury stock		-49,850	-	-	-49,850
Additional paid-in capital		17,389	-	-	17,389
Consolidated reserves		1,576,112	-	-2,500	1,573,612
Net income for the period		533,296	-	-	533,296
EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT		2,085,861	-	-2,500	2,083,361
Attributable to non-controlling interests		96,138	-	-	96,138
TOTAL EQUITY		2,181,999	-	-2,500	2,179,499
Non-current borrowings	5.2.5.5	1,635,811	180,253	-	1,816,064
Provisions for pensions and other post-employment benefits		105,184	-	-	105,184
Provisions for liabilities and charges		35,592	-	-	35,592
Non-current grants		6,323	-	-	6,323
Deferred tax liabilities		80,718	-	-	80,718
TOTAL NON-CURRENT LIABILITIES		1,863,628	180,253	-	2,043,881
Bank overdrafts		4,684	-	-	4,684
Current borrowings and financial debt	5.2.5.5	123,215	49,980	-	173,195
Other current financial debt		31	-	-	31
Hedging instruments		4,330	-	-	4,330
Provisions for liabilities and charges		55,120	-	-	55,120
Current grants		3,994	-	-	3,994
Trade payables		1,614,989	-	-	1,614,989
Other operating liabilities (Deferred income)	5.2.7.2	927,406	-	2,500	929,906
TOTAL CURRENT LIABILITIES		2,733,769	49,980	2,500	2,786,249
Liabilities related to assets held for sale			-	-	-
TOTAL EQUITY AND LIABILITIES		6,779,396	230,233	-	7,009,629

The amount of operating leases in the "Off-balance sheet commitments" (note 7.2.2) of the Consolidated Financial Statements as of December 31, 2018 amounted to €229,826 thousand. The difference with the amount of €230,233 thousand at January 1, 2019 is due to different methods of calculation (renewal assumptions, impact of discounting), the translation difference at the two dates and the contracts not restated for IFRS 16 (contracts of which duration is less than or equal to twelve months and those with a new value of less than € 5,000).

2.2. Impact of changes in the scope of consolidation in 2018 and 2017

The Group's income statement at June 30, 2018, presented for the comparison purpose with June 30, 2019, did not include:

• the HBPO business, which at the time was consolidated using the equity method; and
• the Environment business, for which results were presented on a separate line of the income statement in accordance with IFRS 5.

In the first half of 2019, these changes in the scope of consolidation in 2018 have evolved as follows:

2.2.1. Impact in 2019 of the acquisition in 2018 of an additional 33.33% interest in HBPO

The takeover of HBPO is recognized in accordance with IFRS 3R "Business combinations." The opening balance sheet at July 1, 2018 was finalized without any adjustments compared with December 2018.

On this basis, at June 30, 2019, goodwill amounted to €524,795 thousand.

If the takeover of HBPO had occurred at January 1, 2018, the aggregates of the Group at June 30, 2018 would have been as follows:

• sales: €4,198.6 million;
• operating margin: €341.6 million;
• income from continuing operations before tax and after share of income from associates and joint ventures: €548.0 million. This amount includes the revaluation of €255 million relating to the 33.33% equity share held in HBPO prior to the acquisition based on its fair value

2.2.2. Impact of the disposal of the "Environment" business completed on December 18, 2018

Compagnie Plastic Omnium sold the Environment Division to the consortium "Latour Capital/Bpifrance (French public investment bank) on December 18, 2018.

No significant element relating to this sale occurred during the first half of 2019.

2.2.3. Impact of the disposal of the Automotive Division's Truck business on June 30, 2017

In accordance with the sale agreement, the process for determining any price adjustments ended during the halfyear. No price revision is expected.

2.3. Change in 2019 of the legal form of Compagnie Plastic Omnium

2.3.1. Compagnie Plastic Omnium: European company

The legal form of Compagnie Plastic Omnium has changed. From limited company, Compagnie Plastic Omnium became a European company following the decision of the Shareholders' Meeting of April 25, 2019.

2.4. Evolution in the 1st Semester 2019 of the shareholding of Compagnie Plastic Omnium

2.4.1. Strengthening of the equity stake of Burelle SA in Compagnie Plastic Omnium

During the 1st Semester 2019, Burelle SA acquired 400,000 shares of Compagnie Plastic Omnium, increasing its equity interest from 58.51% to 58.78% before cancellation of treasury shares.

3. SEGMENT INFORMATION

3.1. Information by operating segment

The Group uses the concept of "Economic revenue" for its operational management, which corresponds to the consolidated sales of the Group and its joint ventures at their ownership percentage: Yanfeng Plastic Omnium, the Chinese leader in exterior body parts, SHB Automotive modules a leading Korean front-end module company (Samlip) and BPO, a major player in the Turkish market for exterior equipment.

The Group organizes its Automotive businesses into two operating segments (see note on "Group Presentation"):

Industries;

Modules.

The Environment Division, a separate business sector in prior years, was sold on December 18, 2018. At June 30, 2018, in accordance with IFRS 5 "Non-current assets held for sale and discontinued operations", this business results were presented on a single line "Profit after tax of this discontinued activity" in the consolidated income statement.

The columns in the tables below show the amounts by segment. The "Unallocated items" column groups together inter-segment eliminations and amounts that are not allocated to a specific segment (in particular, holding company activity) allowing for the reconciliation of segment data with the Group's consolidated financial statements. Financial results, taxes and the share of profit/(loss) of associates are monitored at Group level and are not allocated to segments. Transactions between segments are carried out on an arm's length basis.

3.1.1. Income statement by operating segment

	First-half 2019
In thousands of euros	Industries		Modules	Unallocated items (2)	Total
Economic sales (revenue) (1)	3,458,252		1,152,713	-	4,610,965
Including Sales from joint ventures at the Group's percentage stake	250,711		92,002	-	342,713
Sales to third parties	3,207,541		1,060,711	-	4,268,252
Sales between segments		-987	987	-	-
Consolidated sales (revenue)	3,206,554		1,061,698	-	4,268,252
% of segment revenue - Total	75.1%		24.9%		100.0%
Operating margin before amortization of intangible assets acquired in business combinations and before share of profit of associates and joint ventures	239,295		34,757	-	274,052
% of segment revenue		7.5%	3.3%		6.4%
Amortization of intangible assets acquired in business combinations	-4,805		-8,778	-	-13,583
Share of profit/(loss) of associates and joint ventures (3)	19,467		1,057	-	20,524
Operating margin	253,957		27,036	-	280,993
% of segment revenue		7.9%	2.5%		6.6%
Other operating income	20,362		2,047	-	22,409
Other operating expenses	-45,229		-2,135	-	-47,364
% of segment revenue		-0.8%	-0.0%		-0.6%
Finance costs, net					-38,651
Other financial income and expenses, net					1,706
Profit from continuing operations before income tax and after share in associates and joint ventures					219,093
Income tax					-55,599
Net income after income tax from continuing operations					163,494 -
Net income after income tax from discontinued operations
Net income					163,494
	First-half 2018
In thousands of euros	Automotive	Environ ment	Unallocated items(2)	Reclassificatio n IFRS 5	Total
Economic sales (revenue) (1)	3,820,869	165,035		- -165,035	3,820,869
	631,243	-		- -	631,243
Including Sales from joint ventures at the Group's percentage stake	3,189,647	165,050	-37	-165,050	3,189,610
Sales to third parties Sales between segments	-21	-16	37	16	16
Consolidated sales (revenue)	3,189,626	165,034		- -165,034	3,189,626
% of segment revenue - Total	100.0%	5.2%		-5.2%	100.0%
Operating margin before amortization of intangible assets acquired in business combinations and before share of profit of associates and joint ventures	294,888	9,516		- -10,426	293,978
% of segment revenue	9.2%	5.8%		6.3%	9.2%
Amortization of intangible assets acquired in business combinations	-4,882	-		- -	-4,882
Share of profit/(loss) of associates and joint ventures (3)	34,675	-		- -	34,675
Operating margin	324,681	9,516		- -10,426	323,771
% of segment revenue	10.2%	5.8%		6.3%	10.2%
Other operating income	27,021	2,591		- -137	29,475
Other operating expenses	-39,393	-1,860		- 1,860	-39,393
				-1.0%	-1.0%
% of segment revenue	-0.4%	0.4%
Finance costs, net					-33,635
Other financial income and expenses, net					-3,161
Profit from continuing operations before income tax and after share in
associates and joint ventures					277,057
Income tax					-50,900
Net income after income tax from continuing operations Net income after income tax from discontinued activities					226,157 6,575

Net income 232,732

(1) Economic sales (revenue) correspond to the sales of the Group and its joint ventures consolidated at their percentage of ownership.

(2) "Unallocated items" correspond to inter-segment eliminations and amounts that are not allocated to a specific segment (for example, holding company activities). This column is included to enable segment information to be reconciled to the Group's consolidated financial statements.

(3) At June 30, 2018, the contribution of HBPO corresponded to 33.33% of HBPO's net income, i.e. representing the Group's initial equity share before the acquisition of an additional 33.33% stake and the takeover.

3.1.2. Balance sheet aggregate data by operating segment

June 30, 2019
In thousands of euros	Industries	Modules	Unallocated items	Total
Net amounts
Goodwill	491,595	524,795	-	1,016,390
Intangible assets	553,641	173,664	6,262	733,567
Property, plant and equipment	1,756,460	127,513	46,302	1,930,275
Investment property	-	-	93,289	93,289
Inventories	751,526	59,107	-	810,633
Trade receivables	779,237	193,560	3,006	975,803
Other receivables	238,021	27,211	53,386	318,618
Finance receivables (C ) (1)	14,364	-	-	14,364
Current accounts and other financial assets (D)	-1,158,150	3,343	1,244,061	89,254
Long-term investments in equity instruments and in funds - FMEA 2 (F)	137	-	36,603	36,740
Hedging instruments (E )	-	-	3,724	3,724
Net cash and cash equivalents (A) (2)	145,237	51,037	599,900	796,174
Segment assets	3,572,068	1,160,230	2,086,532	6,818,830
Borrowings and financial debt (B)	287,114	54,063	1,620,018	1,961,195
Segment liabilities	287,114	54,063	1,620,018	1,961,195
a Segment net financial debt = (B - A - C- D - E - F) (3)	1,285,526	-317	-264,269	1,020,940

December 31, 2018
	Industries	Modules	Unallocated items	Total
Goodwill	490,935	524,795	-	1,015,730
Intangible assets	545,196	176,870	6,084	728,150
Property, plant and equipment	1,548,607	74,881	29,540	1,653,028
Investment property	-	-	93,263	93,263
Inventories	685,168	51,941	-	737,109
Trade receivables	659,608	141,347	14,345	815,300
Other receivables	275,176	30,948	64,488	370,612
Finance receivables (C ) (1)	24,267	-	-	24,267
Current accounts and other financial assets (D)	-1,015,045	3,444	1,111,372	99,771
Long-term investments in equity instruments and in funds - FMEA 2 (F)	135	-	28,048	28,183
Hedging instruments (E )	-	-	1,898	1,898
Net cash and cash equivalents (A) (2)	124,407	65,105	722,140	911,652
Total segment assets	3,338,454	1,069,331	2,071,178	6,478,963
Borrowings and financial debt (B)	146,303	4,425	1,612,659	1,763,387
Segment liabilities	146,303	4,425	1,612,659	1,763,387
Segment net financial debt = (B - A - C- D - E - F) (3)	1,012,539	-64,124	-250,799	697,616

⁽¹⁾ At June 30, 2019, ''Finance receivables'' included €358 thousand shown under the balance sheet under ''Other non-current financial assets'' vs. €1,763 thousand at December 31, 2018, and €14,006 thousand reported under "Finance receivables – current portion" vs. €22,504 thousand at December 31, 2018. Please refer to Notes 5.1.5.2 et 5.2.5.5.

(3) See Notes 5.2.5.1 "Definition of debt instruments within the Group" and Note 5.2.5.5 "Reconciliation of gross and net financial debt".

⁽²⁾ Net cash and cash equivalents as reported in the Statement of cash flows. See also 5.1.9.2 "Net cash and cash equivalents at end of period".

3.1.3. Other information by operating segment

First-half 2019 In thousands of euros	Industries	Modules	Unallocated items	IFRS 5 Reclassificatio n	Total
Acquisitions of intangible assets	90,489	11,383	1,085	-	102,957
Capital expenditure including acquisitions of investment property	155,583	10,827	640	-	167,050
Depreciation and amortization expense and provisions on fixed assets(1)	-204,284	-27,802	-4,362	-	-236,448
First-half 2018 In thousands of euros	Automotive	Environment	Unallocated items	IFRS 5 Reclassificatio n	Total
Acquisitions of intangible assets	96,627	318	1,170	-318	97,797
Capital expenditure including acquisitions of investment property	180,636	6,185	771	-6,185	181,407

(1) This item corresponds to depreciation, amortization and impairments of property, plant and equipment and intangible assets, including the amortization of intangible assets (primarily contractual customer relationships and, to a lesser extent, brands) acquired in business combinations.

3.1.4. Revenue - Information by geographic region and by country of sales

The information given in the following tables corresponds to the revenue generated by the subsidiaries in the marketing regions or market countries as indicated below:

3.1.4.1. Information by market region

First-half 2019			First-half 2018
In thousands of euros	Totals	%	In thousands of euros	Totals	%
France	378,655	8.2%	France	334,772	8.8%
North America	1,310,608	28.4%	North America	943,179	24.7%
Europe excluding France	2,066,669	44.8%	Europe excluding France	1,744,081	45.6%
South America	81,789	1.8%	South America	101,389	2.7%
Africa	45,348	1.0%	Africa	41,108	1.1%
Asia	727,896	15.8%	Asia	656,340	17.1%
Economic revenue	4,610,965	100%	Economic revenue	3,820,869	100%
Including revenue from joint ventures at the Group's percentage stake	342,713		Including revenue from joint ventures at the Group's percentage stake	631,243
Consolidated revenue	4,268,252		Consolidated revenue	3,189,626

3.1.4.2. Information for the top ten contributing countries

First-half 2019			First-half 2018
In thousands of euros	Totals	%	In thousands of euros	Totals	%
Germany	743,570	16.1%	Germany	656,556	17.2%
United States	666,707	14.5%	United States	577,173	15.1%
Mexico	575,901	12.5%	Spain	371,332	9.7%
China	384,628	8.3%	China	362,785	9.5%
France	378,655	8.2%	France	334,772	8.8%
Spain	352,162	7.6%	Mexico	328,890	8.6%
Slovakia	257,431	5.6%	United Kingdom	249,275	6.5%
United Kingdom	244,625	5.3%	Slovakia	138,157	3.6%
Korea	161,269	3.5%	Korea	121,648	3.2%
Hungary	143,919	3.1%	Czech Republic	76,414	2.0%
Other	702,098	15.3%	Other	603,867	15.8%
Economic revenue	4,610,965	100%	Economic revenue	3,820,869	100%
Including revenue from joint ventures at the Group's percentage stake	342,713		Including revenue from joint ventures at the Group's percentage stake	631,243
Consolidated revenue	4,268,252		Consolidated revenue	3,189,626

Including revenue from joint ventures at the Group's percentage stake	631,243

3.1.4.3. Information by Automotive manufacturer

First-half 2019			First-half 2018
Automotive manufacturers	Totals		Automotive manufacturers	Totals
In thousands of euros	Totals	% of total Automotive revenue	In thousands of euros	Totals	% of total Automotive revenue
Volkswagen-Porsche	1,223,507	26.5%	Volkswagen-Porsche	871,461	22.8%
PSA Peugeot Citroën	465,476	10.1%	PSA Peugeot Citroën	514,381	13.5%
General Motors	428,254	9.3%	General Motors	468,867	12.3%
BMW	379,247	8.2%	Ford	369,309	9.7%
Daimler	370,559	8.0%	Renault/Nissan/Mitsubishi	293,849	7.6%
Total – main manufacturers	2,867,043	62.2%	Total – main manufacturers	2,517,867	65.9%
Other automotive manufacturers	1,743,922	37.8%	Other automotive manufacturers	1,303,002	34.1%
Total Economic revenue	4,610,965	100.0%	Total Economic revenue	3,820,869	100%
Including revenue from joint ventures at the Group's percentage stake	342,713		Including revenue from joint ventures at the Group's percentage stake	631,243
Total Consolidated revenue	4,268,252		Total Consolidated revenue	3,189,626

In thousands of euros	Totals	% of total Automotive revenue
manufacturers	1,303,002	34.1%
Including revenue from joint ventures at the Group's percentage stake	631,243

4. NOTES TO THE INCOME STATEMENT

4.1. Breakdown of Research and Development costs

The percentage of research and development costs is expressed in relation to the amount of revenue.

In thousands of euros	First-half 2019	%	First-half 2018	%
Research and development costs after developments sold	-148,762	-3.5%	-148,672	-4.7%
Capitalized development costs	96,901	2.3%	92,884	2.9%
Depreciation of capitalized development costs	-76,595	-1.8%	-48,604	-1.5%
Research tax credit	6,394	0.1%	7,803	0.2%
Other (including grants received)	539	0.0%	170	0.0%
Net research and development costs	-121,523	-2.8%	-96,419	-3.0%

4.2. Cost of goods and services sold, development, selling and administrative costs

In thousands of euros	First-half 2019	First-half 2018
Cost of sales includes:
Raw materials (purchases and changes in inventory) (1)	-3,039,071	-2,045,516
Direct production outsourcing	-7,428	-5,805
Utilities and fluids	-56,200	-48,453
Employee benefits expenses	-384,172	-327,571
Other production costs	-122,196	-166,439
Depreciation	-125,674	-80,581
Provisions	6,048	15,398
Total	-3,728,693	-2,658,967
Research and development costs include:
Employee benefits expenses	-113,569	-99,903
Depreciation, amortization and provisions	-84,843	-53,124
Other	76,889	56,608
Total	-121,523	-96,419
Selling costs include:
Employee benefits expenses	-13,298	-13,818
Depreciation, amortization and provisions	-326	-829
Other	-5,583	-5,703
Total	-19,207	-20,350
Administrative costs include:
Employee benefits expenses	-79,207	-70,444
Other administrative expenses	-36,055	-44,085
Depreciation	-9,840	-5,383
Provisions	326	-
Total	-124,776	-119,912

(1) Including charges and reversals of provisions for impairment on inventories amounting to :

· - €4,560 thousand at June 30, 2019;

· + €272 thousand at June 30, 2018.

4.3. Amortization of intangible assets acquired in business combinations

This item corresponds essentially to:

• the amortization over nine years of contractual customer relationships recognized in 2011 on Ford's fuel tank business in the United States;
• the amortization over six years of contractual customer relationships recognized during the take-over on July 29, 2016 of the Faurecia Group Exterior Systems business;
• And the amortization over seven years for contractual customer relationships and over fifteen years for the brand recognized with the takeover of HBPO in 2018.

In thousands of euros	First-half 2019	First-half 2018
Amortization of Brands	-276	-175
Amortization of Contractual customer relationships	-13,307	-4,707
Total amortization of intangible assets acquired in business combinations	-13,583	-4,882

4.4. Share of profit/(loss) of associates and joint ventures

The associates Chengdu Faway Yanfeng Plastic Omnium and Dongfeng Plastic Omnium Automotive Exterior are included in the YFPO joint ventures.

		Share of profit/(loss) of associates and joint ventures is broken down as follows:
--	--	------------------------------------------------------------------------------------	--

In thousands of euros	First-half 2019 % Interest	First-half 2018 % Interest	First-half 2019	First-half 2018
JV HBPO GmbH and its subsidiaries (1)	-	33.33%	-	8,295
HBPO - SHB Automotive Modules (Samlip)	33.34%	16.67%	1,049	411
HICOM HBPO Sdn Bhd	26.66%	13.33%	8	25
JV Yanfeng Plastic Omnium and its subsidiaries - joint venture	49.95%	49.95%	15,745	22,305
B.P.O. AS - joint venture	49.98%	49.98%	3,844	5,470
Plastic Recycling SAS - joint venture(2)	-	50.00%	-	18
POCellTech	23.00%	23.00%	-122	-1,849
Total share of profit/(loss) of associates and joint ventures			20,524	34,675

(1) During the first-half 2018, the 33.33% interest in HBPO shown corresponded to the Group's equity share before the acquisition of an additional 33.33% stake in HBPO.

(2) The Group sold its equity investment in "Plastic Recycling" in February 2018. The share of profit in 2018 represents its profit in the Group's financial statements at the time of the sale.

4.5. Other operating income and expenses

In thousands of euros	First-half 2019	First-half 2018
Pre-start-up costs at new plants (1)	-8,584	-10,490
Reorganization costs(2)	-14,094	-3,266
Impairment of non-current assets (3)	-1,635	-70
Provisions for charges (4)	-2,464	9,162
Litigations	-630	2,350
Foreign exchange gains and losses on operating activities (5)	-4,080	-6,076
Fees and expenses related to changes in the scope of consolidation	-199	2,014
Deconsolidation impact	-	492
Gains/losses on disposal of long-term investments in equity instruments and in funds	841	-42
Retirement pension plan in the U.S.: change in the plan(6)	13,375	-
Other (7)	-7,297	-1,067
Losses on disposals of non-current assets	-187	-2,925
Total operating income and expenses	-24,955	-9,918
- of which total other operating income	22,409	29,475
- of which total other operating expense	-47,364	-39,393

During the First-half 2019

(1) Pre-start costs at new plants:

All of the costs incurred in first-half 2019 relate to Intelligent Exterior Systems plants mainly the Greer plant in the United States, Hlohovec in Slovakia and Kenitra in Morocco.

(2) Reorganization costs:

Reorganization costs mainly relate to significant restructuring in:

• the Intelligent Exterior Systems division: continued reorganization in Germany and closure of a plant in the United States;
• the Clean Energy Systems division : restructuring in France.
• (3) Impairment of non-current assets:

Impairments of non-current assets mainly related to production and projects assets of Intelligent Exterior Systems in Germany and Poland.

(4) Provisions for charges:

This heading mainly includes provisions for quality disputes with several car manufacturers.

(5) Foreign exchange gains and losses on operating activities:

During the first half of 2019, currencies fluctuated little, leading to a contained impact. Virtually all foreign exchange losses are realized by the "Industries" segment, mainly related to the US dollar and the Argentine peso.

(6) Change in United States retirement pensions plan :

The Group opted to shift from a defined-benefit retirement plan to a defined-contribution plan for its U.S. subsidiary, Plastic Omnium Auto Inergy LLC, which is affiliated to the "Industries" segment.

(7) Other:

Non-material amounts taken individually.

4.6. Net financial income

In thousands of euros	First-half 2019	First-half 2018
Finance costs	-30,580	-29,485
Interest on post-employment benefit obligations	-1,179	-1,208
Interest on lease debt(1)	-4,519	-256
Financing fees and commissions	-2,373	-2,686
Finance costs, net	-38,651	-33,635
Exchange gains or losses on financing activities	-1,164	9,111
Gains or losses on interest rate and currency hedges(2)	2,648	-12,272
Other (3)	222	-
Other financial income and expenses, net	1,706	-3,161
Total	-36,945	-36,796

(1) See Notes 2.1.1 "First application of IFRS 16 «Lease contract» and impacts on the financial statements ", 5.1.2 "Property, plant and equipment" and 5.2.5.5 "Reconciliation of gross and net financial debt".

(2) See Notes 5.2.6.1.2 on "Impact of hedging on the Income statement" and 5.2.6.2.2 on the "Impact of unsettled foreign exchange hedges on income and equity".

(3) During the first-half of 2019, this section includes a reverse of impairment of the UCITS for an amount of +€523 thousand. See Note 5.2.5.3 "Loans, negotiable debt securities and other financial assets".

4.7. Income tax

4.7.1. Income tax recorded in the income statement

The income tax expense breaks down as follows:

In thousands of euros	First-half 2019	First-half 2018
Current taxes on continuing activities	-59,275	-47,027
Current income tax (expense)/income	-55,793	-45,524
Tax (expense)/income on non-recurring items	-3,482	-1,503
Deferred taxes on continuing activities	3,676	-3,873
Deferred tax (expense)/income on timing differences arising or reversed during the period	4,786	-1,061
Effect of changes in tax rates or the introduction of new taxes	-1,110	-2,812
Income tax on continuing activities recorded in the consolidated income statement	-55,599	-50,900

4.7.2. Income tax analysis - Tax proof

Analysis of the income tax expense reveals the following factors:

In thousands of euros		First-half 2019		First-half 2018
		% (1)	Totals	% (1)
Consolidated profit on continuing activities before tax and share of profit/(loss) of associates and joint ventures (A)	198,569		242,382
French standard tax rate (B)	32.20%		34.43%
Theoretical tax expense (C) = (A) x (-B)	-63,939		-83,452
Difference between the theoretical tax expense and the current and deferred tax expense excluding tax assessed on net interim profit on continuing activities (D)	8,340	4.2%	32,552	-13.4%
Tax credits	19,565	9.9%	19,184	7.9%
Permanent differences between accounting profits and taxable profits	-5,851	-2.9%	-5,021	-2.1%
Change in unrecognized deferred taxes	-8,202	-4.1%	593	0.2%
Impact on deferred tax of a tax rate change	-1,110	-0.6%	-2,785	-1.1%
Impact of differences in foreign tax rates	13,755	6.9%	22,307	9.2%
Value-added tax contribution	-2,959	-1.5%	-3,061	-1.3%
Other impacts	-6,858	-3.5%	1,335	0.6%
Total current and deferred tax expense on continuing activities (E) = (C) + (D)	-55,599		-50,900
Effective tax rate on continuing activities (E)/(A)	28.0% 21.0%

(1) Percentage expressed in relation to the consolidated profit on continuing activities before tax and share of profit/(loss) of associates and joint ventures (C)

The Group's effective tax rate in first-half 2019 was 28.0 % (21.0 % for first-half 2018).

In the first-half of 2019, the tax recognized amounted to an expense of €55.6 million for a theoretical tax of €63.9 million, based on a tax rate of 32.20 %.

During the first-half of 2018, for the same period, the tax recognized amounted to an expense of €50.9 million for a theoretical tax of €83.5 million, based on a tax rate of 34.43%.

The difference between the tax recognized in the income statement and the theoretical tax is mainly explained:

• for €19.6 million by using specific tax reductions or credits mainly in North America, Asia and France (€19.2 million for first-half 2018);
• for €13.8 million by the impact of more favorable tax rates, mainly in Asia, Europe (excluding France and Belgium) and Mexico (€22.3 million for first-half 2018);
• for -€8.2 million by the effect of losses or other assets generated in the year but not recognized, net of those previously not activated but used or recognized in the year (€0.6 million for first-half 2018); and
• for -€5.8 million by permanent differences between accounting profits and taxable profits such as taxable dividends (-€5 million for first-half 2018).

4.8. Net profit attributable to non-controlling interests

The net profit attributable to non-controlling interests corresponds to the share of minority interests in the profit/loss of fully consolidated entities controlled by the Group. It breaks down as follows:

In thousands of euros	First-half 2019	First-half 2018
JV HBPO GmbH and its subsidiaries	5,859	-
Beijing Plastic Omnium Inergy Auto Inergy Co. Ltd	796	970
Plastic Omnium Auto Inergy Manufacturing India Pvt Ltd	300	633
DSK Plastic Omnium Inergy	1,547	1,060
DSK Plastic Omnium BV	-14	-31
Total attributable to non-controlling interests	8,488	2,632

4.9. Earnings per share and diluted earnings per share

Net profit attributable to owners of the parent	First-half 2019	First-half 2018
Basic earnings per share (in euros)	1.06	1.56
Diluted earnings per share (in euros)	1.06	1.55
Net income from discontinued activities
Basic earnings per share from discontinued activities (in euros)	-	0.04
Diluted earnings per share from discontinued activities (in euros)	-	0.04
Net income from continuing activities
Basic earnings per share from continuing activities (in euros)	1.06	1.52
Diluted earnings per share from continuing activities (in euros)	1.06	1.51
Weighted average number of ordinary shares outstanding at end of period	148,566,107	150,976,720
- Treasury stock	-2,398,486	-3,461,894
Weighted average number of ordinary shares, undiluted	146,167,621	147,514,826
- Impact of dilutive instruments (stock options)	69,001	734,804
Weighted average number of ordinary shares, diluted	146,236,622	148,249,630
Weighted average price of the Plastic Omnium share during the period
- Weighted average share price	23.79	39.65

5. NOTES TO THE BALANCE SHEET

5.1. Assets

5.1.1. Goodwill

At June 30, 2019, as no indications of impairment had been identified by the Group, no impairment tests were carried out (see Note 1.3 "Use of estimates and assumptions").

GOODWILL In thousands of euros	Gross Value	Impairment	Net value
Goodwill at January 1, 2018	584,685	-	584,685
Disposal of the Environment Division	-98,525	-	-98,525
Goodwill adjustment on the acquisition of companies in the Clean Energy Systems Division of the Industries segment	-303	-	-303
Goodwill of HBPO	524,795	-	524,795
Translation differences	5,078	-	5,078
Goodwill at December 31, 2018	1,015,730	-	1,015,730
Translation differences	660	-	660
Goodwill at June 30, 2019	1,016,390	-	1,016,390

5.1.2. Property, plant and equipment

Tangible fixed assets correspond to tangible assets held in their own right but also, since January 1, 2019, to rights of use related to leases of tangible assets following the application of IFRS 16 "Lease contracts".

In thousands of euros	Land	Buildings	Tech. eq. & tool.	Property, plant and equipment under construction	Other property, plant and equipment	Total
Carrying amount at December 31, 2018: Property, plant and equipment owned outright	105,518	473,080	581,347	326,915	166,168	1,653,028
Reclassifications(1)	-358	-868	-11,567	-	-	-12,793
Other changes in the period	-305	-3,175	17,495	-5,290	46,773	55,498
Carrying amount at June 30, 2019: Property, plant and equipment owned outright (A)	104,855	469,037	587,275	321,625	212,941	1,695,733
Right-of-use leased assets
1st application of IFRS 16 at January 1, 2019	852	196,809	14,173	-	18,399	230,233
Reclassifications(1)	358	868	11,567	-	-	12,793
Acquisitions	1,269	15,193	2,389	-	1,603	20,454
End of lease	-	-3,344	-288	-	-562	-4,194
Depreciation for the period	-1,608	-15,963	-3,772	-	-3,693	-25,036
Translation adjustment	7	172	86	-	27	292
Carrying amount at June 30, 2019 : Right-of-use leased assets (B)	878	193,735	24,155	-	15,774	234,542
Carrying amount at June 30, 2019: Property, plant and equipment (C) = (A)+ (B)	105,733	662,772	611,430	321,625	228,715	1,930,275

(1) Corresponds to finance leases agreements capitalized in the financial statements at December 31, 2018 according to IAS 17 "Lease Agreement" and in accordance with IFRS 16, reclassified since January 1, 2019 as "Right-of-use leased assets".

Information on rents resulting from leases and services not capitalized:

The lease expense on uncapitalized leases amounted to €5.9 million as at June 30, 2019.

5.1.3. Investment property

As at June 30, 2019, the item "Investment property" was composed of the same assets as at December 31, 2018. It includes:

• an office complex of 33,000 sq.m. located in Lyon Gerland, 82% of which is rented to a third party and 3% is used by the Group;
• as well as an undeveloped plot of land in the Lyon region.

In thousands of euros	Land	Buildings	Total
Lyon Gerland office complex	12,700	80,589	93,289
Fair value at June 30, 2019	12,700	80,589	93,289

In thousands of euros	Land	Buildings	Total
Lyon Gerland office complex	12,700	80,563	93,263
Fair value at December 31, 2018	12,700	80,563	93,263

5.1.4. Non-consolidated interests and investments in associates and joint ventures accounted for by the equity method

The non-consolidated securities relate to non-significant shell companies, dormant companies and small stakes (Tactotek OY) for which changes in value are recognized in the income statement (IFRS 9 "Financial instruments").

Investments in associates and joint ventures correspond to investments by the Group in the following companies:

In thousands of euros	2019 % interest	2018 % interest	June 30, 2019	December 31, 2018
HBPO - SHB Automotive Modules (Samlip)(1)	33.34%	33.34%	15,420	16,141
HICOM HBPO Sdn Bhd(1)	26.66%	26.66%	476	466
JV Yanfeng Plastic Omnium and its subsidiaries - joint venture	49.95%	49.95%	154,017	159,850
B.P.O. AS - joint venture	49.98%	49.98%	11,153	14,221
POCellTech	23.00%	23.00%	282	2,319
Total investments in associates and joint ventures			181,348	192,997
Equity investments in "Tactotek OY"(2)			-	-
Other non-consolidated equity investments			239	225
Total non-consolidated equity investments			239	225
Total of Investments in associates and joint ventures and in non listed equity instruments			181,587	193,222

(1) This relates to HBPO's two joint ventures.

(2) The 2018 equity stake acquisition in the Finnish company "Tactotek OY" was impaired at the end of the 2018. An additional investment for €300 thousand realized during first-half 2019. It is also impaired at June 30, 2019.

5.1.5. Non-current financial assets

The financial assets recognized under this item correspond to long-term investments in equities and funds as well as other assets such as deposits and surety bonds grouped as follows:

5.1.5.1. Long-term investments in equities and funds

In thousands of euros	June 30, 2019			December 31, 2018
	Subscribed amounts	Non-called up amounts	Net	Subscribed amounts	Non-called up amounts	Net
Financial investments in the "FMEA 2" fund (1)	-	-	829	-	-	829
Financial investments in listed securities(1)	-	-	32,874	-	-	25,719
Investment in the venture capital company "Aster"(2)	20,000	-17,100	2,900	20,000	-18,500	1,500
Other	-	-	137	-	-	135
Long-term investments in equities and funds			36,740			28,183

(1) Financial investments in the "FMEA 2" fund and investments in shares in listed companies are listed with long-term financial receivables in Note 5.2.5.5 "Reconciliation of gross and net financial debt".

(2) Call for funds of €1.4 million at the end of January with payment in February 2019.

5.1.5.2. Other non-current financial assets

In thousands of euros	June 30, 2019	December 31, 2018
Loans	1,892	1,979
Deposits and surety bonds	28,347	33,846
Other receivables	-	4
Other non-current assets and financial receivables (see Note 5.2.5.5)	30,240	35,829
Finance receivables related to Automotive contracts	358	1,763
Non-current financial receivables (see Note 5.2.5.5)	358	1,763
Total	30,598	37,592

"Deposits and surety bonds" mainly concern deposits relating to leased offices and assignment of receivables programs.

5.1.6. Inventories

In thousands of euros	June 30, 2019	December 31, 2018
Raw materials and supplies
At cost (gross)	210,102	190,377
Net realizable value	197,038	180,667
Molds, tooling and engineering
At cost (gross)	461,695	431,360
Net realizable value	457,102	426,623
Other work in progress
At cost (gross)	-	-
Net realizable value	-	-
Maintenance inventories
At cost (gross)	67,544	63,432
Net realizable value	58,701	54,934
Goods
At cost (gross)	1,658	1,754
Net realizable value	1,331	1,361
Semi-finished products
At cost (gross)	57,346	43,311
Net realizable value	53,325	40,746
Finished products
At cost (gross)	45,979	35,656
Net realizable value	43,136	32,778
Total, net	810,633	737,109

5.1.7. Current financial receivables

In thousands of euros	June 30, 2019	December 31, 2018
	Carrying amount	Carrying amount
Current financial receivables (see Note 5.2.5.5) of which Automotive Division finance receivables	14,006 14,006	22,504 22,504
Other current financial assets and financial receivables (see Note 5.2.5.5) of which "Negotiable debt securities" (1) of which "UCITS" or mutual funds (2) of which "Other"	59,014 9,003 49,707 304	63,942 14,003 49,185 754
Total current financial receivables	73,020	86,446

(1) See Note 5.2.5.3 "Loans, negotiable debt securities and other financial assets : Negotiable medium-term notes subscribed on February 24, 2015".

(2) The change corresponds to an impairment of short-term investment securities. See Note 5.2.5.3 "Loans, negotiable debt securities and other financial assets" .

5.1.8. Trade and other receivables

5.1.8.1. Sale of receivables

Compagnie Plastic Omnium and some of its European and United States subsidiaries have set up several commercial receivables sales programs with French banks. These programs have an average maturity of more than two years.

These non-recourse programs transfer substantially all the risks and rewards of ownership to the buyer of the sold receivables; for these programs, only the non-material dilution risk is not transferred to the buyer.

Receivables sold under these programs, which are therefore no longer included in the balance sheet, totaled €383 million at June 30, 2019 versus €347 million at December 31, 2018.

5.1.8.2. Trade receivables - Cost, impairment and carrying amounts

In thousands of euros	June 30, 2019			December 31, 2018
	Cost	Impairment	Carrying amount	Cost	Impairment	Carrying amount
Trade receivables	980,741	-4,938	975,803	820,132	-4,833	815,300

The Group has not identified significant unaccrued customer risk over the two periods.

5.1.8.3. Other receivables

In thousands of euros	June 30, 2019	December 31, 2018
Sundry receivables	112,766	101,949
Prepayments to suppliers of tooling and prepaid development costs	24,493	70,713
Prepaid and recoverable income taxes	83,455	97,810
Other prepaid and recoverable taxes	80,864	82,613
Employee advances	5,693	3,129
Prepayments to suppliers of non-current assets	11,347	14,398
Other receivables	318,618	370,612

5.1.8.4. Trade and other receivables by currency

In thousands of currency units		June 30, 2019			December 31, 2018
		Local currency	Euro	%	Local currency	Euro	%
EUR	Euro	687,858	687,858	53%	619,258	619,258	52%
USD	US dollar	318,785	280,127	22%	306,508	267,692	23%
CNY	Chinese yuan	697,998	89,275	7%	618,348	78,519	7%
GBP	Pound sterling	36,880	41,135	3%	29,418	32,887	3%
Other	Other currencies		196,027	15%		187,556	16%
Total			1,294,422	100%		1,185,912	100%
Of which:
● Trade receivables			975,803	75%		815,300	69%
● Other receivables			318,618	25%		370,612	31%

5.1.9. Cash and cash equivalents

5.1.9.1 Gross cash and cash equivalents

In thousands of euros	June 30, 2019	December 31, 2018	June 30, 2018
Cash at banks and in hand	780,491	903,485	423,370
Short-term deposits	23,144	12,851	70,938
Total cash and cash equivalents on the balance sheet	803,635	916,336	494,308

Cash and cash equivalents break down as follows:

In thousands of euros	June 30, 2019	December 31, 2018	June 30, 2018
Cash and cash equivalents of the Group's captive reinsurance company	33,721	33,689	31,559
Cash and cash equivalents in countries with exchange controls (1)	76,580	84,380	91,731
Cash equivalents	693,334	798,267	371,018
Total cash and cash equivalents on the balance sheet	803,635	916,336	494,308

(1) The countries in "regions with exchange controls" include Brazil, China, India, Chile, Argentina and South Korea.

The different categories of the above table are presented under current assets in the absence of any general restriction on these amounts.

5.1.9.2 - Net cash and cash equivalents at end of period

In thousands of euros	June 30, 2019	December 31, 2018	June 30, 2018
Cash and cash equivalents	803,635	916,336	494,308
Short-term bank loans and overdrafts	-7,461	-4,684	-13,021
Net cash and cash equivalents at end of period in the statement of cash flows	796,174	911,652	481,287

5.2. Liabilities

5.2.1. Group shareholders' equity

5.2.1.1 Share capital of Compagnie Plastic Omnium

In euros	June 30, 2019	December 31, 2018
Share capital for the period at January 1	8,913,966	9,058,603
Capital reduction during the period	-	-144,637
Share capital at end of period, made up of ordinary shares with a par value of €0.06 each over the two periods	8,913,966	8,913,966
Treasury stock	146,050	137,456
Total share capital net of treasury stock	8,767,916	8,776,511

Shares registered on behalf of the same holder for at least two years have double voting rights.

Capital structure at June 30, 2019

At June 30, 2019, the share capital of Compagnie Plastic Omnium remains unchanged from December 31, 2018. The treasury shares amount to 2,434,169, i.e. 1.64 % of the share capital, against 2,290,930 own shares i.e. 1.54 % of the share capital at December 31, 2018.

During the 1st semester 2019, the parent company Burelle SA holding increased its equity interest from 58.51% to 58.78% before cancellation of treasury shares (see Note 2.4.1 under « Significant events of the period»).

Capital structure at December 31, 2018

The Compagnie Plastic Omnium Boards of Directors' of July 19, 2018 and October 30, 2018 decided, respectively, to cancel 1,100,613 treasury shares (i.e. 0.74% of share capital) and 1,300,000 treasury shares (i.e. 0.87% of the previously reduced share capital). The two transactions took effect on July 25, 2018 and November 8, 2018 respectively.

At December 31, 2018, the share capital of Compagnie Plastic Omnium, consisting of shares with a par value of €0.06, amounted to €8,913,966.42 including 2,290,930 treasury shares, i.e. 1.54% of the share capital, against 3,306,070 treasury shares, i.e. 2.19% of the share capital, at December 31, 2017.

In thousands of euros	Actuarial gains/(losses) recognized in equity	Cash flow hedges – interest rate instruments	Cash flow hedges – currency instruments	Fair value adjustments	Retained earnings and other reserves	Attributable to owners of the parent
December 31, 2017	-51,733	-626	1,525	18,238	1,399,164	1,366,568
1st application of IFRS 15	-	-	-	-	-4,818	-4,818
1st application of IFRS 9	-	-	-	-	-1,939	-1,939
At January 1, 2018	-51,733	-626	1,525	18,238	1,392,407	1,359,811
Movements for first half of 2018	271	286	-4,741	-1,984	334,895	328,727
At June 30, 2018	-51,462	-340	-3,216	16,254	1,727,302	1,688,538
Movements for second-half 2018	1,436	-1,516	1,935	2,350	-75,134	-70,929
At December 31, 2018	-50,026	-1,856	-1,281	18,604	1,652,168	1,617,609
1st application of IFRS 16	-	-	-	-	-	-
1st application of IFRIC 23	-	-	-	-	-2,500	-2,500
At January 1, 2019	-50,026	-1,856	-1,281	18,604	1,649,668	1,615,109
Movements for first half of 2019	-5,737	175	326	7,172	422,839	424,775
At June 30, 2019	-55,763	-1,681	-955	25,776	2,072,507	2,039,884

5.2.1.2 Breakdown of "Other reserves" in the consolidated statement of changes in equity

5.2.1.3 Breakdown of "Changes in scope of consolidation and reserves" in the consolidated statement of changes in equity

The takeover of HBPO and its full consolidation has no impact on the reserves "Attributable to owners of the parent", but leads to the recognition of minority interests for the 33.33% stake of the partner, Hella.

5.2.2. Dividends voted and paid by Compagnie Plastic Omnium

In thousands of euros Dividend per share in euros	June 30, 2019		December 31, 2018
Number of shares in units	Number of shares in 2018	Dividend		Dividend
Dividend per share (in euros)		0.74 (1)		0.67 (1)
Total number of shares outstanding at the end of the previous year	148,566,107		150,976,720
Total number of shares held in treasury on the ex-dividend date	2,392,281 (2)		3,481,820 (2)
Total number of shares held in treasury at the year-end (for information)	2,290,930 (2)		3,306,070 (2)
Dividends on ordinary shares		109,939		101,154
Dividends on treasury stock (unpaid)		-1,770 (2)		-2,333 (2)
Total net dividend		108,169		98,822

(1) During first-half 2019, Compagnie Plastic Omnium paid a dividend of €0.74 per share on the 2018 net profit.

During first-half 2018, Compagnie Plastic Omnium paid a dividend of €0.67 per share on the 2017 net profit.

(2) At June 30, 2019: 2,290,930 treasury shares were taken into account at December 31, 2018 to determine the provisional total dividend. The number of treasury shares at the time of the dividend's payment during the firsthalf of 2019 amounted to 2,392,281 shares, increasing the dividends attached to these shares from €1,695 thousand to €1,770 thousand.

At December 31, 2018: 3,306,070 treasury shares were taken into account at December 31, 2018 to determine the provisional total dividend. The number of treasury shares at the time of the dividend's payment during the first-half of 2018 amounted to 3,481,820 shares, increasing the dividends attached to these shares from €2,215 thousand to €2,333 thousand.

5.2.3. Share-based payments

The Combined Shareholders' Meeting of April 26, 2018 authorized the Board of Directors of February 19, 2019 to award free existing shares of the Company effective May 2, 2019, subject to performance conditions, and vesting from May 2, 2023, following a 4-year vesting period.

This plan was valued using the principles of IFRS 2. The main assumptions retained for this valuation were as follows:

Valuation of May 2, 2019 plan	Options for May 2, 2019 plan
In euros In units for the number of shares
Number of shares allocated to the performance share plan	400,000 shares
Market conditions	Not subject to market conditions
Average value of one share	€23.00
Number of shares attributable after application of a turnover rate	386,000 shares
Accounting expense (with adjustment to reserves)	€8,878,000

On these bases, the plan of May 2, 2019 was valued at €8,878,000. The expense is amortized on a straight-line basis over the vesting period of four years (of which €364,350 as of June 30, 2019).

Other information	Plan of May 2, 2019
Plastic Omnium share price at the performance plan date	€25.65
Performance condition 1 : Operating margin target	Final acquisition of 50% of the rights granted
Performance condition 2: Free cash flow target	Final acquisition of 50% of the rights granted
Total number of beneficiaries	255

5.2.4. Provisions

In thousands of euros	December 31, 2018	Allocations	Utilizations	Releases of surplus provisions	Other reclassificatio ns	Actuarial gains/(losses)	Translation adjustment	June 30, 2019
Customer warranties	26,898	6,110	-2,515	-471	552	-	41	30,615
Reorganization plans	15,438	2,202	-3,271	-200	178	-	13	14,360
Taxes and tax risks	6,363	358	-27	-288	290	-	-	6,696
Contract risks(1)	29,654	9,238	-15,293	-1,428	414	-	36	22,621
Claims and litigations	4,277	1,222	-428	-69	174	-	7	5,183
Other	8,082	1,264	-2,047	-178	-1,608	-	17	5,530
Provisions for liabilities and charges	90,712	20,394	-23,582	-2,634 -	-	-	114	85,004
Provisions for pensions and other post employment benefits(2)	105,184	38	-1,621	-13,375	-	8,029	302	98,557
TOTAL	195,896	20,432	-25,202	-16,009	-	8,029	416	183,561

(1) Impacts of loss-making contracts and losses on completion in the "Industries" segment.

(2) The "Release of surplus provisions" for the period is due mainly to the transition of the last subsidiaries in the United States to a "Defined contribution Plan" (see Note 4.5 "Other operating income and expenses").

The change in the "Actuarial gain" over the period includes the changes in the euro zone's discount rate (from 1.6 % at December 31, 2018 to 1 % at June 30, 2019) and in the United States (from 4.45 % at December 31, 2018 to 3.7 % at June 30, 2019).

In thousands of euros	December 31, 2017	IFRS 15 1st application on January 1, 2018(1)	Allocati ons	Utilizatio ns	Releases of surplus provisions	Disposa l of Environ ment Division	Other reclassifi cations	Actuarial gains/(los ses)	Consolida tion of Modules(2)	Translatio n adjustmen t	December 31, 2018
Customer warranties	27,403	-	16,534	-4,122	-13,255	-2,212	-936	-	3,378	108	26,898
Reorganization plans(3)	15,905	-	8,296	-10,928	-27	-300	2,616	-	425	-549	15,438
Taxes and tax risks(4)	8,548	-	4,446	-4,111	-2,083	-667	230	-	-	-	6,363
Contract risks(5)	47,650	4,008	23,858	-37,412	-14,262	-	5,779	-	43	-10	29,654
Claims and litigations	11,172	-	938	-5,214	-2,883	-113	442	-	-	-65	4,277
Other(6)	14,955	-	2,796	-625	-512	-633	-9,953	-	2,240	-186	8,082
Provisions for liabilities and charges	125,633	4,008	56,868	-62,412	-33,022	-3,925	-1,822	-	6,086	-702	90,712
Provisions for pensions and other post employment benefits(7)	106,517	-	11,281	-1,477	-	-11,871	-	-2,285	964	2,055	105,184
TOTAL	232,150	4,008	68,149	-63,889	-33,022	- 15,796	-1,822	-2,285	7,050	1,353	195,896

(1) 1st application of IFRS 15

(2) Related to the impacts of the acquisition of HBPO.

(3) Related to the impacts of restructuring in the Intelligent Exterior Systems Division sites.

(4) Related to the reversal of provisions for tax audits.

(5) Related to the impacts of loss-making contracts and losses on completion in the "Industries" segment.

(6) The "Others" sub-section included individually insignificant amounts.

(7) The actuarial difference corresponded to the revaluation of the US plan assets.

5.2.5. Non-current borrowings

5.2.5.1 Definition of debt instruments within the Group

Net debt is an important notion for the day-to-day management of Plastic Omnium's cash. It is used to determine the Group's debit or credit position in relation to third parties and outside of the operating cycle. Net debt is determined as:

• long-term borrowings:
  • o drawdowns on lines of credit;
  • o private placement notes;
  • o bonds;
• less loans, negotiable debt securities and other long-term financial assets (see Note 5.2.5.3 " Loans, negotiable debt securities and other financial assets");
• plus short-term loans;
• plus overdraft facilities;
• less cash and cash equivalents.

5.2.5.2 Borrowings: private placement notes and bonds

At June 30, 2019:

The main features of the bonds and private placements as at June 30, 2019 are summarized in the following table:

June 30, 2019		2013 bond	"Schuldscheindarlehen" private placement of 2016	Private placement bond issue of June 2017	"Schuldscheindarlehen" private placement of December 21, 2018
Issue - Fixed rate	(in euros)	500,000,000	300,000,000	500,000,000	300,000,000
Annual interest rate / coupon		2.875%	1.478% 1.25%		1.6320%
Features		European investors	International (Asian, German, Dutch, Swiss, Luxembourg, Belgian) and French investors	European investors	International (Germany, China, Belgium, Switzerland, Austria) and French investors
		No "covenants" and "rating"
Maturity		May 29, 2020	June 17, 2023	June 26, 2024	December 21, 2025

5.2.5.3 Loans, negotiable debt securities and other financial assets

Other financial assets include loans, security deposits and surety bonds, negotiable debt securities and mutual funds holding cash and bonds (UCITS - Undertaking for Collective Investment in Transferable Securities).

Other financial assets also include investment securities that do not meet the criteria for classification as cash equivalents. These assets are measured at their fair value at the closing date, and changes in fair value are recognized in net financial income. The impairment of -€822 thousand recognized at December 31, 2018 has been decreased to -€299 thousand at June 30, 2019.

In 2015, the Group subscribed to negotiable medium-term notes with a credit institution and in 2017, the Group invested in UCITS holding medium-term bonds and cash. One of these notes matured in the first-half of 2019.

Expiry of negotiable medium-term notes subscribed on February 24, 2015:

The negotiable medium-term note of €5 million subscribed by the Group on February 24, 2015 expired during this 1st semester. See Note 5.2.5.5 "Reconciliation of gross and net financial debt".

The summary is presented in the table below:

Negotiable medium-term notes	Classified as current financial receivables (1)	UCITS (2)
Subscription date	July 13, 2015	February 24, 2015	December 14 and 29, 2017
Nominal (in euros)	4,000,000	5,000,000	50,006,265
Depreciation			-299,180(3)
Maturity	July 15, 2019 Not available for four quarters following the subscription date	February 24, 2020 Not available for eight quarters following the subscription date	Indeterminate
Quarterly coupon: Fixed rate Variable rate	Fixed for the first four quarters following the issue 3-month Euribor + spread as of the fifth quarter	Fixed for the first eight quarters following the issue 3-month Euribor + spread as of the ninth quarter	N/A
Total at June 30, 2019	€9,000,000		€49,707,085

(1) See Note 5.1.7 "Current financial receivables".

• (2) UCITS: Undertaking for Collective Investment in Transferable Securities.
• (3) Regarding the impairment of the UCITS in the two periods, please refer to Note 4.6 "Net Financial Income".

5.2.5.4 Utilization of medium-term credit lines

At June 30, 2019 as at December 31, 2018, the Plastic Omnium Group had access to several confirmed bank lines of credit exceeding the Group's requirements.

At June 30, 2019, the amount of these confirmed bank lines of credit amounted to €1,290 million with an average maturity of four years, compared with €1,264 million at December 31, 2018.

5.2.5.5 Reconciliation of gross and net financial debt

In thousands of euros	June 30, 2019			December 31, 2018
	Total	Current portion	Non-current portion	Total	Current portion	Non-current portion
Finance lease liabilities	234,865	53,921	180,944	11,616	2,400	9,216
Bonds and bank loans	1,723,907	566,685	1,157,222	1,747,410	120,815	1,626,595
of which the "Schuldscheindarlehen" private placement 2018(1)	301,280	2,575	298,705	298,841	148	298,693
of which the bond issue in 2017	496,483	497	495,986	499,148	3,545	495,603
of which the bond issue in 2013	500,337	500,337	-	507,072	8,546	498,526
of which the "Schuldschein" private placement 2016	299,261	158	299,103	301,393	2,393	299,000
of which bank lines of credit	126,546	63,118	63,428	140,956	106,183	34,773
Non-current and current borrowings (+)	1,958,772	620,606	1,338,166	1,759,026	123,215	1,635,811
Other current debt (+)	67	67		31	31
Hedging instruments - liabilities (+)(2)	2,357	2,357		4,330	4,330
Total borrowings (B)	1,961,196	623,030	1,338,166	1,763,387	127,576	1,635,811
Long-term investments in equity instruments and in funds (-) (3)	-36,740		-36,740	-28,183		-28,183
Other financial assets (-)	-44,604	-14,006	-30,598	-60,096	-22,504	-37,592
of which non-current financial receivables (4)	-30,240		-30,240	-35,829		-35,829
of which trade accounts receivable (4) (5)	-14,364	-14,006	-358	-24,267	-22,504	-1,763
Other current financial assets and financial receivables (-) (5)	-59,014	-59,014		-63,942	-63,942
of which negotiable debt securities and UCITS (6)	-58,710	-58,710		-63,188	-63,188
Hedging instruments - assets (-) (2)	-3,724	-3,724		-1,898	-1,898
Total financial receivables (C)	-144,082	-76,744	-67,338	-154,119	-88,344	-65,775
a
Gross debt (D) = (B) + (C)	1,817,114	546,286	1,270,828	1,609,268	39,232	1,570,036
Cash and cash equivalents (-) (7)	803,635	803,635		916,336	916,336
Short-term bank loans and overdrafts (+)	-7,461	-7,461		-4,684	-4,684
Net cash and cash equivalents as recorded in the statement of cash flows (A) (8)	-796,174	-796,174		-911,652	-911,652
NET FINANCIAL DEBT (E) = (D) + (A)	1,020,940	-249,888	1,270,828	697,616	-872,420	1,570,036

(1) See Note 5.2.5.2 "Bonds: private placements and private bonds"

(2) See Note 5.2.6 "Interest rate and foreign exchange hedges"

(3) See Note 5.1.5.1 "Long-term investments in equity instruments and in funds"

(4) See 5.1.5.2 "Other non-current financial assets"

(5) See Notes 5.1.7 "Current financial receivables" and 5.2.7.3 for the principal amount

(6) See Note 5.2.5.3 " Loans, negotiable debt securities and other financial assets : Expiry of negotiable medium-term notes subscribed on February 24, 2015

(7) See Note 5.1.9.1 "Gross cash and cash equivalents"

(8) See Note 5.1.9.2 "Net cash and cash equivalents at end of period"

5.2.5.6 Analysis of gross financial debt by currency

The table below shows the gross financial debt after taking into account the swaps transactions that allowed the conversion of the euro into foreign currency.

As a % of total debt	June 30, 2019	December 31, 2018
Euro	66%	72%
US dollar	23%	18%
Chinese yuan	6%	5%
Pound sterling	3%	4%
Brazilian real	1%	1%
Other currencies(1)	-	-
Total	100%	100%

(1) "Other currencies" concerns various currencies, which, taken individually, account for less than 1% of total financial debt over the two

5.2.5.7 Analysis of gross financial debt by type of interest rate

As a % of total debt	June 30, 2019	December 31, 2018
Hedged variable rates	-	-
Unhedged variable rates	6%	6%
Fixed rates	94%	94%
Total	100%	100%

5.2.6. Interest rate and currency hedges

	June 30, 2019		December 31, 2018
In thousands of euros	Assets	Liabilities	Assets	Liabilities
Interest rate derivatives	-	-	-	-486
Exchange rate derivatives	3,724	-2,357	1,898	-3,844
Total balance sheet	3,724	-2,357	1,898	-4,330

5.2.6.1 Interest rate hedges

periods.

The last interest rate instrument (swap) contract signed by the Group expired in February 2019. There are no closing positions at June 30, 2019.

The Group has no longer any interest rate instrument qualified as "cash flow hedges".

5.2.6.1.1. Amounts recognized in equity under "Other comprehensive income"

The amounts below are expressed in gross value before tax.

In thousands of euros	Balance before tax recorded in OCI at December 31, 2018(1)	Change in fair value of derivatives	Amount reclassified in profit or loss in the period	Balance before tax recorded in OCI at June 30, 2019(1)
Effect of August 2010 and February 2012 restructuring of the derivatives portfolio (2)	217	-	-217	-
Effect of June 2013 restructuring of the derivatives portfolio	-272	-	272	-
Effect of the rate hedging of Schuldschein maturing in 2025	-1,815	-	137	-1,678
Total	-1,870	-	192	-1,678

In thousands of euros	Balance before tax recorded in OCI at December 31, 2017(1)	Change in fair value of derivatives	Amount reclassified in profit or loss in the period	Balance before tax recorded in OCI at December 31, 2018(1)
Effect of August 2010 and February 2012 restructuring of the derivatives portfolio(2)	1,020	-	-803	217
Effect of June 2013 restructuring of the derivatives portfolio	-1,900	-	1,628	-272
Effect of the rate hedging of Schuldschein maturing in 2025	-	-1,823	8	-1,815
Total	-880	-1,823	825	-1,870

(1) OCI: Other Comprehensive Income.

(2) Restructuring of derivatives portfolio to extend maturity of hedging instruments.

5.2.6.1.2 Impact of hedging on the income statement

In thousands of euros	June 30, 2019	December 31, 2018
Effective component of hedging instruments related to derivatives portfolio	-471	-2,970
(hedging of accrued interest over the period)
Reclassification in profit or loss of accumulated gains and losses related to past restructurings(1)	-55	-825
Reclassification in profit or loss of accumulated gains and losses related to interest rate hedging	-137	-8
Time value of caps	-	-
Changes in value of instruments that do not qualify for hedge accounting	478	2,898
Total(2)	-185	-905

(1) See Note 5.2.6.2 "Foreign exchange hedge Instruments" for the amounts reclassified in profit or loss.

(2) See "Gains or losses on interest rate and currency hedges" in Note 4.6 "Net financial income". See also the impact of currency hedges in Note 5.2.6.2.

5.2.6.2 Currency hedges

The Group uses derivatives to hedge its exposure to currency risk.

At June 30, 2019, the fair value of the instruments implemented and thus recognized was €1,367 thousand of which €474 thousand was recognized in equity.

Changes in the fair value of other currency hedging instruments are recognized in net financial income.

5.2.6.2.1. Portfolio of currency hedges

	June 30, 2019					December 31, 2018
	Fair value (in thousands of euros)	Notional amount (in thousands of currency units)	Medium term exchange rate Currency / Euro	Exchange rate at June 30, 2019 Currency / Euro	Fair value (in thousan ds of euros)	Notional amount (in thousands of currency units)	Medium term exchange rate Currency / Euro	Exchange rate at December 31, 2018 Currency / Euro
Net sell position (net buy position if <0)
USD / EUR - Forward exchange contract	-1,454	-174,243	1.1637	1.1380	-1,241	-198,990	1.1708	1.1450
JPY / EUR - Forward exchange contract	-75	-310,890	126.3168	122.6000	-4	-329,595	126.0400	125.8500
GBP / EUR - Forward exchange contract	+143	-4,000	0.8728	0.8966	-	-	0.000	-
KRW / EUR - Forward exchange contract		-82 -8,000,000	1,337.750 0	1,315.350 0	-6	-1,615,763	1,283.475 8	1,277.9300
KRW / USD - Forward exchange contract	-	-	-	-	-19	-3,036,296	1,123.928 2	1,115.8000
KRW / JPY - Forward exchange contract	-	-	-	-	+2	-282,598	10.0373	10.1809
KRW / CNY - Forward exchange contract	-	-	-	-	-4	-794,457	162.9103	162.1331
USD / EUR - Forward currency swap	+2,961	-573,300	1.1329	1.1380	-542	-303,300	1.1482	1.1450
GBP / EUR - Forward currency swap	+6	-18,000	0.8965	0.8966	-91	-25,000	0.8974	0.8945
CHF / EUR - Forward currency swap	-68	-5,440	1.1259	1.1105	-11	-3,940	1.1301	1.1269
RUB / EUR - Forward currency swap	-46	-104,000	76.3619	71.5975	+60	-108,000	76.8650	79.7153
CNY / EUR - Forward currency swap	+16	-238,000	7.8928	7.8185	-22	-398,000	7.9579	7.8751
CNY / USD - Forward currency swap	-	-	-	-	-68	-92,403	6.9003	6.8778
TOTAL	+1,367				-1,946

5.2.6.2.2. Impact of unsettled foreign exchange hedges on income and equity

In thousands of euros	June 30, 2019	December 31, 2018
Impact of change in foreign exchange hedging portfolio on income (ineffective portion)(1)	2,839	-1,071
Impact of change in foreign currency hedging portfolio on equity (effective portion)	474	-3,911
Total	3,313	-4,982

(1) See "Gains or losses on interest rate and currency hedges" in Note 4.6 "Net financial income".

See also Note 5.2.6.1.2 "Impact of hedging on the income statement".

5.2.7. Operating and other liabilities

5.2.7.1. Trade payables

In thousands of euros	June 30, 2019	December 31, 2018
Trade payables	1,578,416	1,444,192
Due to suppliers of fixed assets	93,381	170,797
Total	1,671,797	1,614,989

5.2.7.2. Other operating liabilities

In thousands of euros	June 30, 2019	December 31, 2018
Accrued employee benefits expense	177,504	155,985
Accrued income taxes(1)	48,577	38,797
Other accrued taxes	118,388	122,494
Other payables	269,451	254,299
Customer prepayments - Deferred revenues	363,095	355,831
Total	977,015	927,406

(1) This item includes the accounting of IFRIC 23 for €2.5 million. See the "Changes in equity", and the Note 1.1 "Basis of preparation".

5.2.7.3. Trade payables and other operating liabilities by currency

In thousands of currency units			Liabilities at June 30, 2019			Liabilities at December 31, 2018
		Local currency	Euro	%	Local currency	Euro	%
EUR	Euro	1,501,289	1,501,289	57%	1,390,737	1,390,737	55%
USD	US dollar	598,733	526,127	20%	684,139	597,502	24%
GBP	Pound sterling	123,180	137,393	5%	117,196	131,014	5%
CNY	Chinese yuan	1,273,533	162,887	6%	1,010,547	128,322	5%
BRL	Brazilian real	131,986	30,334	1%	146,333	32,928	1%
Other	Other currencies		290,782	11%		261,892	10%
Total			2,648,812	100%		2,542,395	100%
Of which:
● Trade payables		1,671,797	63%		1,614,989	64%
● Other operating liabilities		977,015	37%		927,406	36%

6. CAPITAL MANAGEMENT AND MARKET RISKS

Compagnie Plastic Omnium has set up a global cash management system with its subsidiary Plastic Omnium Finance, which manages liquidity, currency and interest rate risks on behalf of all subsidiaries. The market risks strategy, which may result in entering balance sheet and off-balance sheet commitments, is approved every quarter by the Chairman and Chief Executive Officer.

6.1. Capital management

The Group's objective is to have, at all times, sufficient financial resources to enable it to carry out its current business, fund the investments required for its development and also to respond to any exceptional events.

This is achieved through the use of capital markets, leading to capital and financial debt management.

As part of its capital management strategy, the Group pays dividends to its shareholders and may make adjustments in line with changes in economic conditions.

The capital structure may be adjusted by paying ordinary or special dividends, through share buybacks and cancellation of treasury stock, returning a portion of capital to shareholders or issuing new shares and/or securities giving rights to capital.

The Group uses the gearing ratio, corresponding to the ratio of consolidated net debt to equity, as an indicator of the Group's leverage. The Group includes in net debt all financial liabilities and commitments, other than operating payables, interest-bearing liabilities, less cash and cash equivalents and other non-operating financial assets, such as marketable securities and loans. At June 30, 2019 and December 31, 2018, the gearing ratio was as follows:

In thousands of euros	June 30, 2019	December 31, 2018
Net financial debt(1)	1,020,940	697,616
Equity (including non-current grants)	2,231,108	2,188,321
Gearing ratio	45.76%	31.88%

(1) See Note 5.2.5.5 "Reconciliation of gross and net financial debt".

None of the Group's bank loans or financial liabilities contains covenants providing for early repayment in the event of non-compliance with financial ratios.

6.2. Credit risk

Credit risk covers customer credit risk and bank counterparty risk.

6.2.1. Customer risk

At June 30, 2019, 5,7% of the Group's trade receivables were past due, versus 7.4% at December 31, 2018. Trade receivables break down as follows:

Ageing analysis of net receivables:

At June 30, 2019 :

In thousands of euros	Total outstanding	Not yet due	Due and past due	Less than 1 month	1-6 months	6-12 months	More than 12 months
Industries	779,237	724,881	54,356	34,048	13,589	3,584	3,135
Modules	193,560	191,890	1,670	1,125	544	-	-
Unallocated items	3,006	3,006	-	-	-	-	-
Total	975,803	919,777	56,026	35,173	14,133	3,584	3,135

At December 31, 2018 :

In thousands of euros	Total outstanding	Not yet due	Due and past due	Less than 1 month	1-6 months	6-12 months	More than 12 months
Industries	659,608	602,083	57,525	30,926	14,368	6,131	6,100
Modules	141,347	138,916	2,431	1,811	620	-	-
Unallocated items	14,345	14,341	4	4	-	-	-
Total	815,300	755,340	59,960	32,741	14,988	6,131	6,100

The risk of non-recovery is low and involves only a non-material amount of receivables more than twelve months past due.

6.2.2. Bank counterparty risk

The Group invests its cash surplus with leading banks and/or in senior securities.

6.3. Liquidity risk

The Group must at all times have sufficient financial resources to finance the current business and the investments required to support its development, but also to withstand any exceptional events.

This objective is mainly achieved by using medium-term lines of credit with banking institutions but also by shortterm bank resources.

The cash position of the Group is monitored daily for each business division and at central level, and a weekly summary report is submitted to the Chairman and Chief Executive Officer and the Chief Operating Officers.

At June 30, 2019:

In thousands of euros	June 30, 2019	Less than 1 year	1 to 5 years	More than 5 years
Financial liabilities
Non-current borrowings (1)	1,433,173	-	1,065,456	367,717
Bank overdrafts	7,461	7,461	-	-
Current borrowings (2)	653,490	653,490	-	-
Other current financial debt	67	67	-	-
Hedging instruments	2,357	2,357	-	-
Trade payables	1,671,797	1,671,797	-	-
Total financial liabilities	3,768,345	2,335,172	1,065,456	367,717

(1) "Non-current borrowings" includes the amounts reported in the balance sheet and interest payable over the remaining life of the debt.

(2) "Current borrowings" includes the amounts reported in the balance sheet and interest due within one year.

At December 31, 2018:

In thousands of euros	December 31, 2018	Less than 1 year	1 to 5 years	More than 5 years
Financial liabilities
Non-current borrowings (1)	1,762,934	29,955	924,231	808,748
Bank overdrafts	4,684	4,684	-	-
Current borrowings (2)	126,754	126,754	-	-
Other current financial debt	31	31	-	-
Hedging instruments	4,330	4,330	-	-
Trade payables	1,614,989	1,614,989	-	-
Total financial liabilities	3,513,722	1,780,743	924,231	808,748

(1) "Non-current borrowings" includes the amounts reported in the balance sheet and interest payable over the remaining life of the debt.

(2) "Current borrowings" includes the amounts reported in the balance sheet and interest due within one year.

7. ADDITIONAL INFORMATION

7.1. Related party transactions

Related party transactions correspond to transactions with Sofiparc, Burelle SA and Burelle Participations. The nature of contracts which bind the Group with these companies has not been subject to any changes over the period.

No material change has been made to the compensation paid to senior executives and officers since December 31, 2018.

7.2. Consolidating entity

Burelle SA holds 59.76% of Compagnie Plastic Omnium, after the cancellation of Compagnie Plastic Omnium's treasury stock (58.78% before cancellation of treasury stock), and fully consolidates the Company.

Burelle SA - 19, Boulevard Jules Carteret 69342 Lyon Cedex 07

7.3. Subsequent events

No event likely to have a material impact on the Group's business, financial position, earnings or assets and liabilities at June 30, 2019 has occurred since the closing date.

LIST OF CONSOLIDATED COMPANIES AT JUNE 30, 2019

Consolidation method and special features:

• G: Full consolidation
• EM: Companies that were already consolidated by the equity method before the application of the new Consolidation standards at January 1, 2014.

EM_IFRS: Companies consolidated by the equity method since the application of the new consolidation at January 1, 2014

Movements for the period:

• a: Companies created and/or acquired during the First-half 2019
• b: Takeover of HBPO on July 1, 2018
• c: Disposal of the Environment Division in December 2018 business classified in accordance with IFRS 5 under "Assets and liabilities held for sale" at June 30, 2018

d: Entities sold in 2018

	Reportable segment				June 30, 2019			December 31, 2018			June 30, 2018
Legal name	Industr ies	Module s	Enviro nment	Un- allocat ed	Method of Consolidation	% control	% interest	Method of Consolidation	% control	% intere st	Method of Consolidation	% control	% interes t
France
COMPAGNIE PLASTIC OMNIUM SA				*	Parent company			Parent company			Parent company
PLASTIC OMNIUM GESTION SNC				*	FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM FINANCE SNC				*	FC	100	100	FC	100	100	FC	100	100
SIGNALISATION FRANCE SA				*	FC	100	100	FC	100	100	FC	100	100
INERGY AUTOMOTIVE SYSTEMS FRANCE SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIEUR HOLDING SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIEUR SERVICES SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIORS SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY MANAGEMENT SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIEUR SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM COMPOSITES SA	*				FC	100	100	FC	100	100	FC	100	100
MIXT COMPOSITES RECYCLABLES - MCR SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY SERVICES SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY FRANCE SAS	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM MANAGEMENT 4	*				FC	100	100	FC	100	100	FC	100	100
d PLASTIC RECYCLING SAS	*				-	-	-	EM_Ifrs	50	50	EM_Ifrs	50	50
c PLASTIC OMNIUM SYSTEMES URBAINS SAS			*		-	-	-	FC	100	100	FC	100	100
c METROPLAST SAS			*		-	-	-	FC	100	100	FC	100	100
c LA REUNION VILLES PROPRES SAS			*		-	-	-	FC	100	100	FC	100	100
c PLASTIC OMNIUM CARAIBES SAS			*		-	-	-	FC	100	100	FC	100	100
c LUDOPARC SAS			*		-	-	-	FC	100	100	FC	100	100
BEAUVAIS DIFFUSION SAS			*		-	-	-	FC	100	100	FC	100	100
c TECHNIQUES ET MATERIELS DE COLLECTE - « TEMACO » SAS			*		-	-	-	FC	100	100	FC	100	100
c PLASTIC OMNIUM ENVIRONNEMENT HOLDING SAS			*		-	-	-	FC	100	100	FC	100	100
SULO FRANCE SAS			*		-	-	-	FC	100	100	FC	100	100
South Africa
PLASTIC OMNIUM AUTO INERGY SOUTH AFRICA (PROPRIETARY) Ltd	*				FC	100	100	FC	100	100	FC	100	100

	Reportable segment				June 30, 2019			December 31, 2018			June 30, 2018
Legal name	Industri es	Modules Enviro	nment	Un- allocat ed	Method of Consolidation	% control	% interest	Method of Consolidation	% control	% intere st	Method of Consolidation	% control	% interes t
Germany
PLASTIC OMNIUM GmbH				*	FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO COMPONENTS GmbH	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY GERMANY GmbH	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM COMPOSITES GmbH	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTOMOTIVE EXTERIORS GmbH	*				FC	100	100	FC	100	100	FC	100	100
b HBPO BETEILIGUNGSGESELLSCHAFT GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO RASTATT GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO GERMANY GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO INGOLSTADT GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO REGENSBURG GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO VAIHINGEN Enz GmbH		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
a HBPO Saarland GmbH		*			FC	66.67	66.67	-	-	-	-	-	-
c PLASTIC OMNIUM ENTSORGUNGSTECHNIK GmbH			*		-	-	-	FC	100	100	FC	100	100
c PLASTIC OMNIUM ENVIRONNEMENT GmbH			*		-	-	-	FC	100	100	FC	100	100
c ENVICOMP SYSTEMLOGISTIK GmbH			*		-	-	-	FC	100	100	FC	100	100
c WESTFALIA INTRALOG GmbH			*		-	-	-	FC	100	100	FC	100	100
c SULO UMWELTTECHNIK GmbH			*		-	-	-	FC	100	100	FC	100	100
c PLASTIC OMNIUM SYSTEMS GmbH			*		-	-	-	FC	100	100	FC	100	100
SULO EA GmbH			*		-	-	-	FC	100	100	FC	100	100
Argentina
PLASTIC OMNIUM AUTO INERGY ARGENTINA SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTOMOTIVE ARGENTINA	*				FC	100	100	FC	100	100	FC	100	100
Belgium
c PLASTIC OMNIUM NV			*		-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM ADVANCED INNOVATION AND RESEARCH NV	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY BELGIUM SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTOMOTIVE BELGIUM	*				FC	100	100	FC	100	100	FC	100	100
OPTIMUM CPV BVBA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM NEW ENERGIES SA	*				FC	100	100	FC	100	100	FC	100	100
Brazil
PLASTIC OMNIUM AUTO INERGY	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM DO BRASIL Ltda	*				FC	100	100	FC	100	100	FC	100	100
b HBPO BRASIL AUTOMOTIVE SERVICIOS Ltda		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33

		Reportable segment			June 30, 2019			December 31, 2018			June 30, 2018
	Industri	Module	Enviro	Un-	Method of	%	%	Method of	%	%	Method of	%	%
Legal name	es	s	nment	allocat ed	Consolidation	control	interest	Consolidation	control	intere st	Consolidation	control	interes t
Canada
b HBPO CANADA INC.		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
Chile
c PLASTIC OMNIUM SA			*		-	-	-	FC	100	100	FC	100	100
China
PLASTIC OMNIUM HOLDING (SHANGHAI) Co. Ltd				*	FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM COMPOSITES (JIANGSU) Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
WUHAN PLASTIC OMNIUM AUTO INERGY Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM INERGY (SHANGHAI) CONSULTING Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
INERGY AUTOMOTIVE SYSTEMS CONSULTING (BEIJING) Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
BEIJING PLASTIC OMNIUM AUTO INERGY Co. Ltd	*				FC	60	60	FC	60	60	FC	60	60
CHONGQING PLASTIC OMNIUM AUTO INERGY Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
GUANGZHOU PLASTIC OMNIUM AUTO INERGY Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
NINGBO PLASTIC OMNIUM AUTO INERGY Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
SHENYANG PLASTIC OMNIUM AUTO INERGY Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
YANFENG PLASTIC OMNIUM AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM (SHANGHAI) AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM YIZHENG AUTOMOTIVE EXTERIOR SYSTEM Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM (SHENYANG) AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM NINGBO AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM WUHAN AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM HARBIN AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM HANGZHOU AUTO EXTERIOR SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95	EM_Ifrs	49.95	49.95
YANFENG PLASTIC OMNIUM NINGDE AUTOMOTIVE EXTERIOR a SYSTEMS Co. Ltd	*				EM_Ifrs	49.95	49.95	-	-	-	-	-	-
a YANKANG AUTO PARTS RUGAO Co. Ltd	*				EM_Ifrs	49.95	49.95	-	-	-	-	-	-
CHONGQING YANFENG PLASTIC OMNIUM AUTOMOTIVE EXTERIOR FAWAY Co. Ltd	*				EM_Ifrs	49.95	25.47	EM_Ifrs	49.95	25.47	EM_Ifrs	49.95	25.47
GUANGZHOU ZHONGXIN YANFENG PLASTIC OMNIUM AUTOMOTIVE EXTERIOR TRIM Co. Ltd	*				EM_Ifrs	49.95	25.47	EM_Ifrs	49.95	25.47	EM_Ifrs	49.95	25.47
CHENGDU FAWAY YANFENG PLASTIC OMNIUM Co. Ltd	*				EM	24.48	24.48	EM	24.48	24.48	EM	24.48	24.48
DONGFENG PLASTIC OMNIUM AUTOMOTIVE EXTERIOR SYSTEMS Co. Ltd	*				EM	24.98	24.98	EM	24.98	24.98	EM	24.98	24.98
CHANGCHUN HUAZHONG YANFENG PLASTIC OMNIUM AUTOMOTIVE EXTERIORS Co. Ltd	*				EM_Ifrs	49.95	24.98	EM_Ifrs	49.95	24.98	EM_Ifrs	49.95	24.98
b HBPO CHINA Co. Ltd		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO CHINA BEIJING Co. Ltd		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
South Korea
PLASTIC OMNIUM Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
b SHB AUTOMOTIVE MODULES		*			EM_Ifrs	33.34	33.34	EM_Ifrs	33.34	33.34	EM_Ifrs	16.67	16.67
b HBPO PYEONGTAEK Ltd		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO ASIA HQ Ltd		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33

		Reportable segment			June 30, 2019			December 31, 2018			June 30, 2018
Legal name	Industr ies	Module s	Enviro nment	Un- allocat ed	Method of Consolidation	% control	% interest	Method of Consolidation	% control	% intere st	Method of Consolidation	% control	% interes t
Spain
COMPANIA PLASTIC OMNIUM SA				*	-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM EQUIPAMIENTOS EXTERIORES SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY SPAIN SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM COMPOSITES ESPANA SA	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM COMPONENTES EXTERIORES SL	*				-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTOMOTIVE ESPANA	*				FC	100	100	FC	100	100	FC	100	100
b HBPO AUTOMOTIVE SPAIN SL		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
c PLASTIC OMNIUM SISTEMAS URBANOS SA			*		-	-	-	FC	100	100	FC	100	100
United States
PLASTIC OMNIUM Inc.				*	FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM INDUSTRIES Inc.				*	FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIORS LLC	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY (USA) LLC	*				FC	100	100	FC	100	100	FC	100	100
AUTOMOTIVE EXTERIORS LLC	*				FC	100	100	FC	100	100	FC	100	100
b HBPO NORTH AMERICA Inc.		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
Hungary
b HBPO MANUFACTURING HUNGARY Kft		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
b HBPO AUTOMOTIVE HUNGARIA Kft		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
India
PLASTIC OMNIUM AUTO EXTERIORS (INDIA) PVT Ltd	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY INDIA PVT Ltd	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY MANUFACTURING INDIA PVT Ltd	*				FC	55	55	FC	55	55	FC	55	55
Israel
POCellTech	*				EM	50	23	EM	50	23	EM	50	23
Japan
PLASTIC OMNIUM KK	*				FC	100	100	FC	100	100	FC	100	100

		Reportable segment				June 30, 2019			December 31, 2018			June 30, 2018
Legal name		Industri es	Module s	Enviro nment	Un- allocat ed	Method of Consolidation	% control	% interest	Method of Consolidation	% control	% intere st	Method of Consolidation	% control	% interes t
Malaysia
HICOM HBPO SDN BHD	b		*			EM	26.66	26.66	EM	26.66	26.66	EM	13.33	13.33
Morocco
PLASTIC OMNIUM AUTO INERGY (MOROCCO) SARL		*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIEUR		*				FC	100	100	FC	100	100	FC	100	100
Mexico
PLASTIC OMNIUM INDUSTRIAL AUTO EXTERIORES RAMOS ARIZPE SA DE CV		*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY MEXICO SA DE CV		*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIORES SA DE CV		*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM SISTEMAS URBANOS SA DE CV	c			*		-	-	-	FC	100	100	FC	100	100
HBPO MEXICO SA DE CV	b		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
PLASTIC OMNIUM MEDIO AMBIENTE SA DE CV	c			*		-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INDUSTRIAL SRL DE CV		*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY INDUSTRIAL SA DE CV		*				FC	100	100	FC	100	100	FC	100	100
HBPO SERVICES MEXICO SA DE CV	b		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
HBPO MANAGEMENT SERVICES MEXICO SA DE CV	b		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
PLASTIC OMIUM AUTO INERGY SERVICIOS SA DE CV	a	*				FC	100	100	-	-	-	-	-	-
Netherlands
PLASTIC OMNIUM BV	c			*		-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM ENVIRONMENT BV	c			*		-	-	-	FC	100	100	FC	100	100
DSK PLASTIC OMNIUM BV		*				FC	51	51	FC	51	51	FC	51	51
PLASTIC OMNIUM AUTO INERGY NETHERLANDS HOLDING BV		*				FC	100	100	FC	100	100	FC	100	100
Poland
PLASTIC OMNIUM AUTO INERGY POLAND Sp Z.O.O		*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO EXTERIORS Sp Z.O.O		*				FC	100	100	FC	100	100	FC	100	100
SULO Sp Z.O.O	c			*		-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO Sp Z.O.O		*				FC	100	100	FC	100	100	FC	100	100
Czech Republic
HBPO CZECH S.R.O.	b		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
SULO S.R.O.	c			*		-	-	-	FC	100	100	FC	100	100

	Reportable segment			June 30, 2019			December 31, 2018			June 30, 2018
Legal name	Industr ies	Module s	Enviro nment	Un- allocat ed	Method of Consolidation	% control	% interest	Method of Consolidation	% control	% intere st	Method of Consolidation	% control	% interes t
Romania
PLASTIC OMNIUM AUTO INERGY ROMANIA SRL	*				FC	100	100	FC	100	100	FC	100	100
United Kingdom
PLASTIC OMNIUM AUTOMOTIVE Ltd	*				FC	100	100	FC	100	100	FC	100	100
c PLASTIC OMNIUM URBAN SYSTEMS Ltd			*		-	-	-	FC	100	100	FC	100	100
c SULO MGB Ltd			*		-	-	-	FC	100	100	FC	100	100
b HBPO UK Ltd		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
Russia
OOO STRAVROVO AUTOMOTIVE SYSTEMS	*				FC	100	100	FC	100	100	FC	100	100
DSK PLASTIC OMNIUM INERGY	*				FC	51	51	FC	51	51	FC	51	51
Singapore
c SULO ENVIRONMENTAL SYSTEMS PTE Ltd			*		-	-	-	FC	100	100	FC	100	100
Slovakia
PLASTIC OMNIUM AUTO EXTERIORS S.R.O.	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTO INERGY SLOVAKIA S.R.O.	*				FC	100	100	FC	100	100	FC	100	100
b HBPO SLOVAKIA S.R.O.		*			FC	66.67	66.67	FC	66.67	66.67	EM_Ifrs	33.33	33.33
PLASTIC OMNIUM AUTOMOTIVE SLOVAKIA S.R.O	*				FC	100	100	FC	100	100	FC	100	100
Sweden
c PLASTIC OMNIUM AB			*		-	-	-	FC	100	100	FC	100	100
Switzerland
c PLASTIC OMNIUM AG			*		-	-	-	FC	100	100	FC	100	100
PLASTIC OMNIUM RE AG				*	FC	100	100	FC	100	100	FC	100	100
SWISS HYDROGEN	*				FC	100	100	FC	100	100	FC	100	100
Thailand
PLASTIC OMNIUM AUTO INERGY THAILAND Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
PLASTIC OMNIUM AUTOMOTIVE Co. Ltd	*				FC	100	100	FC	100	100	FC	100	100
Turkey
B.P.O. AS	*				EM_Ifrs	50	49.98	EM_Ifrs	50	49.98	EM_Ifrs	50	49.98

COMPAGNIE PLASTIC OMNIUM

Statutory Auditors' Review Report on the Half-yearly Financial Information

This is a translation into English of the statutory auditors' review report on the half-yearly financial information issued in French and is provided solely for the convenience of English-speaking users. This report includes information relating to the specific verification of information given in the Group's halfyearly management report. This report should be read in conjunction with, and construed in accordance with, French law and professional standards applicable in France.

Period from January 1 to June 30, 2019

ERNST & YOUNG et Autres MAZARS

ERNST & YOUNG et Autres

Tour First – TSA 14444 92037 Paris-La Défense Cedex S.A.S. à capital variable

Commissaire aux Comptes Membre de la compagnie régionale de Versailles

MAZARS

61, rue Henri Regnault 92075 Paris-La Défense Cedex S.A. au capital de € 8.320.000

Société Anonyme d'Expertise Comptable et de Commissariat aux Comptes à Directoire et Conseil de Surveillance

Compagnie Plastic Omnium Period from January 1 to June 30, 2019

Statutory auditors' review report on the half-yearly financial information

To the Shareholders,

In compliance with the assignment entrusted to us by your Annual General Meeting and in accordance with the requirements of article L. 451-1-2 III of the French Monetary and Financial Code (Code monétaire et financier), we hereby report to you on:

• the review of the accompanying condensed half-yearly consolidated financial statements of Compagnie Plastic Omnium, for the period from January 1 to June 30, 2019,
• the verification of the information presented in the half-yearly management report.

These condensed half-yearly consolidated financial statements are prepared under the responsibility of the Board of Directors. Our role is to express a conclusion on these financial statements based on our review.

1. Opinion on the financial statements

We conducted our review in accordance with professional standards applicable in France. A review of interim financial information primarily consists of making inquiries of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with professional standards applicable in France and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed half-yearly consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34 – standard of the IFRSs as adopted by the European Union applicable to interim financial information.

Without qualifying our conclusion, we draw your attention to the matter set out in Notes 1.1. and 2.1.1. to the condensed half-yearly consolidated financial statements regarding changes in accounting policies relating to IFRS 16 "Leases contracts" effective from January 1, 2019.

2.Specific verification

We have also verified the information presented in the half-yearly management report on the condensed half-yearly consolidated financial statements subject to our review.

We have no matters to report as to its fair presentation and consistency with the condensed half-yearly consolidated financial statements.

Paris-La Défense, July 18, 2019

The Statutory Auditors French original signed by

ERNST & YOUNG et Autres MAZARS

Gilles Puissochet Juliette Decoux