Annual Report • Mar 28, 2023
Annual Report
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March 28 th , 2023
| Annual business review – FY 2022 3 |
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| Annual financial release – FY 20223 |
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| Business highlights of 2022 11 |
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| Perspectives 14 |
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| Related parties15 |
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| Risk factors16 |
| Annual consolidated financial statements FY 202223 – |
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| Annual consolidated financial statements 23 |
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| Notes to the annual consolidated financial statements29 |
| Statutory Auditors' | report101 | |
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Paris, March 9 th , 2023 – JCDecaux SE (Euronext Paris: DEC), the number one outdoor advertising company worldwide, announced today its results for the year ended December 31st , 2022. A report with an unqualified opinion is being issued by the Statutory Auditors.
"Our 2022 Group revenue grew by +20.8%, +16.6% on an organic basis, to reach €3,316.5 million driven by a strong digital revenue growth and a continued strong trading momentum. Our organic revenue growth outside China was +24.1% for the full-year 2022.
Our Digital Out Of Home (DOOH) revenue grew by +41.1% in full-year 2022, +35.2% on an organic basis, to reach a record 31.4% of Group revenue in 2022, while analogue advertising revenue grew double digit organically in 2022. We maintained our focus on the selective roll-out of digital screens in prime locations, as well as on the development of our data capabilities. Programmatic advertising revenues through the VIOOH SSP (supply-side platform), which constitute mostly incremental revenue from innovative dynamic data-driven campaigns and new advertisers, doubled in 2022 to reach €61.3 million i.e. 5.9% of our digital revenue in full-year 2022 as the DOOH programmatic ecosystem, including Displayce following our strategic alliance announced in July 2022, continued to gain traction.
Our client portfolio remained highly diversified as our top 10 clients represent c.14% of our revenue in 2022. Our number one client category Fashion/Personal care and Luxury Goods made up 17% of total revenue and continued to grow strongly at +41% in 2022. Client categories recovering after Covid came back strongly such as Travel at +54% and Entertainment/Leisure at +31%.
With revenue growing by €571.9m in 2022, our adjusted operating margin has reached €602.9m improving by €180.7m, +42.8% year-on-year, 18.2% of total revenue in 2022, +280bp vs 2021, reflecting our strong operating leverage despite a historically low level of activity in China due to mobility restrictions. Our net result Group share is back to positive territory at €132.1m an increase by €146.7m year-on-year consistent with the improvement of our operational performance. Our operating cash flows improved by €161.8m to €399.4m and our free-cash-flow reached €43.2m in 2022 as capex increased notably due to a higher contract gains and renewals activity including more than half of the payment for the advertising rights of the 15-year contract with Shanghai Metro. Our net debt increased slightly by €50.5m, mainly driven by bolt-on M&A investments, reaching €975.0m at the end of the period with a financial leverage at 1.6x (vs 2.2x at the end of 2021).
Recognized as best in class by extra-financial rating institutions (EcoVadis: Platinum, CDP: A-), we continued to strengthen our ESG leading initiatives and commitments in 2022 as we have notably unveiled in May 2022 our ambitious 2030 ESG Strategy and we continued to reduce our carbon footprint, which is now at -27% in 2022 vs 2019 (scopes 1, 2 and 3). Our highly positive business model financing public services and public transportation contributes to mitigate climate change. Almost 50% of our 2022 revenues are thus eligible and aligned with the European taxonomy. Today we announce our new Climate Strategy, "committed SBTi", which includes strong proactive commitments to further optimize our carbon footprint such as reducing by 2030, scopes 1 and 2 emissions, by 60%, scope 3 emissions by 46% and reaching Net Zero by 2050 (scopes 1, 2 and 3).
As far as Q1 2023 is concerned, we now expect an organic revenue growth rate at around +2.5% including a double-digit revenue decline in China where we start seeing an inflection point from March as mobility is returning to normal.
As the most digitised global OOH media company, with our new data-led audience targeting and programmatic solutions, our well diversified portfolio, our ability to win new contracts, the strength of our balance sheet, the high quality of our teams across the world and our recognised ESG excellence, we believe we are well positioned to benefit from the rebound. We are more than ever confident in the power of our media in an advertising landscape increasingly fragmented and more and more digital and in the role it will play to drive economic growth as well as positive changes."
Following the adoptions of IFRS 11 from January 1 st , 2014 and IFRS 16 from January 1 st , 2019, and in compliance with the AMF's instructions, the operating data presented below are adjusted:
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Please refer to the paragraph "Adjusted data" for the definition of adjusted data and reconciliation with IFRS.
The values shown in the tables are generally expressed in millions of euros. The sum of the rounded amounts or variations calculations may differ, albeit to an insignificant extent, from the reported values.
As reported on January 26 th , 2023, adjusted revenue increased by +20.8%, +16.6% on an organic basis, to €3,316.5 million compared to €2,744.6 million in 2021.
| Full-Year adjusted revenue |
2022 (€m) | 2021 (€m) | Reported growth |
Organic growth(a) |
|---|---|---|---|---|
| Street Furniture | 1,747.0 | 1,440.1 | +21.3% | +18.5% |
| Transport | 1,075.2 | 877.8 | +22.5% | +15.0% |
| Billboard | 494.3 | 426.7 | +15.9% | +13.5% |
| Total | 3,316.5 | 2,744.6 | +20.8% | +16.6% |
By activity, Transport and Street Furniture rebounded the most followed by Billboard.
(a) Excluding acquisitions/divestitures and the impact of foreign exchange
All geographies performed strongly with a double-digit revenue growth in 2022 except Asia-Pacific as China was impacted by historically low mobility levels.
| Full-Year adjusted revenue |
2022 (€m) | 2021 (€m) | Reported growth |
Organic growth(a) |
|---|---|---|---|---|
| Europe (b) | 988.3 | 824.5 | +19.9% | +20.2% |
| Asia-Pacific | 721.5 | 695.9 | +3.7% | -2.4% |
| France | 598.0 | 532.6 | +12.3% | +12.1% |
| Rest of the World | 416.8 | 274.9 | +51.6% | +36.4% |
| United Kingdom | 322.5 | 253.3 | +27.4% | +26.3% |
| North America | 269.3 | 163.4 | +64.8% | +45.5% |
| Total | 3,316.5 | 2,744.6 | +20.8% | +16.6% |
(a) Excluding acquisitions/divestitures and the impact of foreign exchange
(b) Excluding France and the United Kingdom
For 2022, our adjusted operating margin has significantly improved by €180.7 million to reach €602.9 million (vs €422.3 million in 2021), a +42.8% increase year-on-year reflecting a strong operating leverage due to a tight control over our cost base growing at a slower pace than our revenue growth despite the negative impact from the decrease of revenue in China year-on-year. The adjusted operating margin as a percentage of revenue was 18.2% in 2022, +280bp above prior year.
| 2022 | 2021 | Change 22/21 | ||||
|---|---|---|---|---|---|---|
| €m | % of revenue |
€m | % of revenue |
Change (€m) |
Margin rate (bp) |
|
| Street Furniture | 417.7 | 23.9% | 323.4 | 22.5% | +94.3 | +140bp |
| Transport | 118.3 | 11.0% | 58.2 | 6.6% | +60.1 | +440bp |
| Billboard | 67.0 | 13.5% | 40.7 | 9.5% | +26.3 | +400bp |
| Total | 602.9 | 18.2% | 422.3 | 15.4% | +180.7 | +280bp |
The adjusted operating margin as a percentage of revenue by business segment:
In 2022, adjusted EBIT before impairment charge improved by €195.7 million to €212.0 million. As a percentage of revenue, this represented a 580bp increase to 6.4%, from +0.6%. Excluding the positive impact from the accounting revaluation of our stake in Interstate JCDecaux, adjusted EBIT before impairment charge for 2022 reached 5.1% as a percentage of revenue.
The net impairment charge on tangible and intangible assets, rights-of-use assets and joint-ventures of €19.1 million in 2022 is mainly related to assets in China reflecting the historically low level of activity due to mobility restrictions in this geography.
Adjusted EBIT, after impairment charge, has improved by €184.3 million from €8.7 million in 2021 to €193.0 million in 2022.
In 2022, interest expenses on IFRS 16 leases were quite stable at -€84.1 million compared to -€82.2 million in 2021, the mechanical reduction of the IFRS 16 lease liability related to the contract life progression being compensated by the additions coming from new contracts, contracts extended and contracts renewed.
In 2022, excluding IFRS 16, other net financial income / (loss) was -€55.0 million compared to -€42.8 million in 2021, a variation of -€12.2 million mainly due the impact of currency hedges and the increase in financial interests from the €500 million bond issued in February 2022.
In 2022, the share of net profit from equity affiliates was €8.6 million, a decrease of €40.0 million mainly due to an impairment charge on our investment in Clear Media reflecting the historically low level of activity due to mobility restrictions in this geography.
In 2022, net income Group share turned positive as it increased by €146.7 million to €132.1 million compared to - €14.5 million in 2021, which mainly came from the improvement in our operational performance, the net positive impact from the accounting revaluation of our stake in Interstate JCDecaux being partly offset by the net negative impact of the impairment charges over the period.
In 2022, adjusted net capex (acquisition of property, plant and equipment and intangible assets, net of disposals of assets) at €349.9 million increased by €192.4 million, +68.2% year-on-year, mainly driven by the pick-up in tenders in 2022 following Covid delays including €84.9 million of payment for advertising rights related to the renewal and extension of our long-term partnership with Shanghai Metro. Excluding this specific payment, the capex to sales ratio amounted to 8% consistent with the average ratio over the last 10 years.
In 2022, operating cash flows reached +€399.4 million improving by +€161.8 million compared to 2021 mainly driven by the improving operating margin. Changes in our working capital had almost no impact on the cash-flow generation during the period (-€6.4 million) despite the strong increase in revenue thanks to an ongoing tight management over cash collection and payments. After capital expenditure, adjusted free cash flow amounted to €43.2 million.
No dividend was paid in 2022 in order to strengthen Group's liquidity, balance sheet and financial flexibility. To continue to reinforce our capacity to seize future organic and external bolt-on investment opportunities, we will propose at the Annual General Meeting which will take place on May 16th , 2023, not to pay any dividend in 2023.
Net debt amounted to €975.0 million as of December 31st , 2022, a slight increase vs December 31st , 2021 where it stood at €924.5 million mainly driven by bolt on M&A activity.
In January 2023, we decided to take advantage of the good market conditions to extend our debt maturity schedule and secured our financing profile with the issuance of a €600 million bond with a maturity in 2029 and a coupon at 5.00%. Subscribed more than 2 times and placed with investors of high quality, the success of this new issuance demonstrates both the quality of JCDecaux's signature and the investors' confidence in the rebound capacity and in the growth potential of the Group.
Right-of-use IFRS 16 as of December 31st , 2022 amounted to €2,725.3 million compared to €2,964.8 million as of December 31st , 2021, a decrease related to the amortisation of rights-of-use and contracts renegotiations partially offset by foreign exchange rate impacts, perimeter impacts, new contracts, contracts extended and contracts renewed.
IFRS 16 lease liabilities decreased from €3,655.8 million as of December 31st , 2021 to €3,412,1 million as of December 31st , 2022. The decrease, mainly related to repayments occurred in 2022 as well as renegotiations and end of contracts is partially offset by new contracts, extensions and renewals, a positive foreign exchange rates impact and a positive perimeter impact.
Under IFRS 11, applicable from January 1 st , 2014, companies under joint control are accounted for using the equity method.
Under IFRS 16, applicable from January 1 st , 2019, a lease liability for contractual fixed rental payments is recognised on the balance sheet, against a right-of-use asset to be depreciated over the lease term. As regards P&L, the fixed rent expense is replaced by the depreciation of the right-of-use in EBIT, below the operating margin, and a lease interest expense on the lease liability in financial result, below EBIT. IFRS 16 has no impact on cash payments but payment of debt (principal) is booked in funds from financing activities.
However, in order to reflect the business reality of the Group and the readability of our performance, our operating management reports used to monitor the activity, allocate resources and measure performance continue:
As regards the P&L, it concerns all aggregates down to the EBIT. As regards the cash flow statement, it concerns all aggregates down to the free cash flow.
Consequently, pursuant to IFRS 8, Segment Reporting presented in the financial statements complies with the Group's internal information, and the Group's external financial communication therefore relies on this operating financial information. Financial information and comments are therefore based on "adjusted" data, consistent with historical data, which is reconciled with IFRS financial statements.
In 2022, the impacts of IFRS 11 and IFRS 16 on our adjusted aggregates are:
-€60.6 million for IFRS 11 and €780.2 million for IFRS 16 on adjusted operating margin (-€58.9 million for IFRS 11 and €800.5 million for IFRS 16 in 2021) leaving IFRS operating margin at €1,322.5 million (€1,163.9 million in 2021).
-€45.0 million for IFRS 11 and €114.1 million for IFRS 16 on adjusted EBIT before impairment charge (- €39.5 million for IFRS 11 and €99.5 million for IFRS 16 in 2021) leaving IFRS EBIT before impairment charge at €281.1 million (€76.2 million in 2021).
The full reconciliation between adjusted figures and IFRS figures is provided on page 10.
The Group's organic growth corresponds to the adjusted revenue growth excluding foreign exchange impact and perimeter effect. The reference fiscal year remains unchanged regarding the reported figures, and the organic growth is calculated by converting the revenue of the current fiscal year at the average exchange rates of the previous year and taking into account the perimeter variations prorata temporis, but including revenue variations from the gains of new contracts and the losses of contracts previously held in our portfolio.
| €m | Q1 | Q2 | Q3 | Q4 | FY | |
|---|---|---|---|---|---|---|
| 2021 adjusted revenue | (a) | 454.3 | 628.1 | 706.5 | 955.8 | 2,744.6 |
| 2022 IFRS revenue | (b) | 628.5 | 739.3 | 747.5 | 958.7 | 3,074.0 |
| IFRS 11 impacts | (c) | 54.4 | 52.5 | 60.9 | 74.7 | 242.5 |
| 2022 adjusted revenue | (d) = (b) + (c) | 683.0 | 791.8 | 808.4 | 1,033.3 | 3,316.5 |
| Currency impacts | (e) | -20.9 | -28.3 | -37.8 | -26.0 | -113.0 |
| 2022 adjusted revenue at 2021 exchange rates |
(f) = (d) + (e) | 662.1 | 763.5 | 770.6 | 1,007.3 | 3,203.5 |
| Change in scope | (g) | 0.0 | 0.0 | -0.4 | -3.0 | -3.4 |
| 2022 adjusted organic revenue |
(h) = (f) + (g) | 662.1 | 763.5 | 770.2 | 1,004.3 | 3,200.1 |
| Organic growth | (i) = (h) / (a) - 1 | +45.7% | +21.6% | +9.0% | +5.1% | +16.6% |
| €m | Impact of currency as of December 31st , 2022 |
|---|---|
| USD | -28.7 |
| RMB | -18.1 |
| HKD | -13.0 |
| BRL | -12.3 |
| Other | -40.9 |
| Total | -113.0 |
| Average exchange rate | FY 2022 | FY 2021 |
|---|---|---|
| USD | 0.9496 | 0.8455 |
| RMB | 0.1413 | 0.1311 |
| HKD | 0.1213 | 0.1088 |
| BRL | 0.1838 | 0.1568 |
(a) Adjusted revenue
For more information about JCDecaux, please visit jcdecaux.com. Join us on Twitter, Linkedin, Facebook, Instagram and Youtube.
This news release may contain some forward-looking statements. These statements are not undertakings as to the future performance of the Company. Although the Company considers that such statements are based on reasonable expectations and assumptions on the date of publication of this release, they are by their nature subject to risks and uncertainties which could cause actual performance to differ from those indicated or implied in such statements.
These risks and uncertainties include without limitation the risk factors that are described in the annual report registered in France with the French Autorité des Marchés Financiers.
Investors and holders of shares of the Company may obtain copy of such annual report by contacting the Autorité des Marchés Financiers on its website www.amf-france.org or directly on the Company website www.jcdecaux.com.
The Company does not have the obligation and undertakes no obligation to update or revise any of the forwardlooking statements.
+33 (0) 1 30 79 79 10 – [email protected]
Investor Relations: Rémi Grisard
+33 (0) 1 30 79 79 93 – [email protected]
| Profit & Loss | 2022 2021 |
|||||||
|---|---|---|---|---|---|---|---|---|
| €m | Adjusted | Impact of companies under joint control |
Impact of IFRS 16 from controlled entities (1) |
IFRS | Adjusted | Impact of companies under joint control |
Impact of IFRS 16 from controlled entities (1) |
IFRS |
| Revenue | 3,316.5 | (242.5) | 0.0 | 3,074.0 | 2,744.6 | (222.1) | 0.0 | 2,522.5 |
| Net operating costs | (2,713.6) | 181.9 | 780.2 | (1,751.5) | (2,322.3) | 163.3 | 800.5 | (1,358.5) |
| Operating margin | 602.9 | (60.6) | 780.2 | 1,322.5 | 422.3 | (58.9) | 800.5 | 1,163.9 |
| Maintenance spare parts | (47.0) | 1.1 | 0.0 | (46.0) | (38.4) | 1.1 | 0.0 | (37.3) |
| Amortisation and provisions (net) | (377.9) | 14.4 | (691.6) | (1,055.1) | (361.8) | 17.9 | (724.7) | (1,068.6) |
| Other operating income / expenses | 34.0 | 0.2 | 25.5 | 59.6 | (5.7) | 0.3 | 23.6 | 18.2 |
| EBIT before impairment charge | 212.0 | (45.0) | 114.1 | 281.1 | 16.3 | (39.5) | 99.5 | 76.2 |
| Net impairment charge (2) | (19.1) | 1.4 | 0.0 | (17.7) | (7.6) | 0.0 | 0.0 | (7.6) |
| EBIT after impairment charge | 193.0 | (43.6) | 114.1 | 263.4 | 8.7 | (39.5) | 99.5 | 68.6 |
(1) IFRS 16 impact on the core business contracts of controlled entities. (2) Including impairment charge on net assets of companies under joint control.
| Cash Flow Statement | 2022 | 2021 | ||||||
|---|---|---|---|---|---|---|---|---|
| €m | Adjusted | Impact of companies under joint control |
Impact of IFRS 16 from controlled entities (1) |
IFRS | Adjusted | Impact of companies under joint control |
Impact of IFRS 16 from controlled entities (1) |
IFRS |
| Operating Cash Flows | 399.4 | (10.6) | 703.7 | 1,092.6 | 237.6 | (16.7) | 615.3 | 836.1 |
| Change in working capital requirement |
(6.4) | 14.6 | (1.2) | 7.0 | 131.4 | 1.7 | 32.6 | 165.7 |
| Net cash flow from operating activities |
393.0 | 4.0 | 702.5 | 1,099.6 | 369.0 | (15.0) | 647.8 | 1,001.8 |
| Capital expenditure | (349.9) | 8.1 | 0.0 | (341.8) | (157.5) | 7.2 | 0.0 | (150.3) |
| Free cash flow | 43.2 | 12.1 | 702.5 | 757.8 | 211.5 | (7.8) | 647.8 | 851.5 |
(1) IFRS 16 impact on the core and non-core business contracts of controlled entities.
In May, JCDecaux announced that its French subsidiary has signed an exclusive contract for in-store digital advertising screens at Galeries Lafayette Paris Hausmann, the leading European department store. The flagship "Coupole" store and the Men store will be equipped from mid-July 2022 with 64 digital screens specifically designed for Galeries Lafayette. The commercial offering will start in September 2022. The screens will be installed on every floor of the department store and will digitalise the customer experience, covering key touch points (entrances and exits, lifts, escalators, etc.) They will enable Galeries Lafayette to strengthen point-of-sale advertising, to create content that is dynamic and relevant to their customers and to enhance brand communication in line with the image and concept of this department store, which welcomes more than 37 million French and international customers per year.
In July, JCDecaux SE announced that its subsidiary, JCDecaux France, has won a 16-year exclusive advertising street furniture contract with the Aix-Marseille-Provence metropolitan area. Installation will start on 1 January 2023 to service the needs of this dynamic metropolitan area of 1.9 million people. The contract covers the provision, maintenance and advertising operation of 1,331 bus shelters, 579 2m2 and 8m2 city information panels, as well as the supply of 100 tram shelters and other street furniture that will further extend the network. The contract also includes the refurbishment, maintenance and operation of 226 tram shelters and street furniture that is owned by the Aix-Marseille-Provence metropolitan area.
In July, JCDecaux SE announced that its subsidiary JCDecaux France has been selected by the City of Paris, to supply and operate its new automatic public toilet service, replacing the current facilities that are also operated by JCDecaux. The new contract was awarded following a competitive tender process that began in August 2020. 435 new-generation automatic toilets will be rolled out between 2024 and the beginning of 2025, replacing the existing facilities installed in 2009. Designed by JCDecaux design studio, the new toilets will be assembled in Les Yvelines (France) at our manufacturing centre in Maurepas by the company's in-house teams.
In July, JCDecaux SE announced that it has been selected by Groupe ADP, following a consultation, to become a co-shareholder of Extime Media. This 50/50 joint venture, which will be held by Groupe ADP and JCDecaux, will operate advertising activities at Paris-Charles de Gaulle, Paris-Orly and Paris-Le Bourget airports from January 1st, 2023. From January 1st, 2024, it is also planned to roll out its activities at Antalya and Milas-Bodrum airports in Turkey. This joint venture will particularly benefit from JCDecaux's relationships with the largest advertisers worldwide. Its advertising activities will be carried out under the business name Extime X JCDecaux, as part of the rollout of Extime, Groupe ADP's hospitality brand.
In April, JCDecaux announced that its Danish JV company AFAJCDecaux won the 15-year exclusive street furniture contract with Aalborg which is the third largest city in Denmark. This agreement which will start on 1/08/2024 includes both analog and digital advertising faces with the possibility to display full motion content in the pedestrian area. The new eco-friendly range of equipment with a high degree of recyclability includes busshelters equipped with sensors increasing the light intensity when passengers are around as well as a new specific Plusbus shelter designed by the renowned Danish Architect Knud Holscher for the new BRT public transport system and automatic public toilets.
In May, JCDecaux announced that its German subsidiary Wall won a 15-year exclusive street furniture contract with Dresden, the capital city of Saxony. Effective from January 1, 2023, this agreement seamlessly continues the existing partnership which started in 1991. The contract includes the installation and maintenance of 850 bus shelters and up to 450 free-standing City-Light-Poster displays including 70 digital screens in Dresden's highly attractive inner city.
In September, JCDecaux SE announced that its subsidiary JCDecaux Portugal has renewed its contract with Sonae Sierra, the leading company in the management and operation of shopping malls in Portugal and in the Autonomous Regions of Madeira and Azores, for ten years.
In July, JCDecaux SE announced that it has signed a 15-year contract to extend the advertising operations of lines 1 to 13 of the Shanghai Metro as well as 5 new lines (lines 14 to 18). This contract, awarded following a tender, will be managed by a joint venture, STDecaux, 60% held by JCDecaux and 40% by Shanghai Shentong Assets Management Co., Ltd. Shanghai Metro currently has 503 stations with an average of 11 million passengers commuting every day in 2021. The metro is currently recovering from the lockdown and has already reached 8.6 million passengers per day as of July 22nd, 2022.This contract covers all of Shanghai Metro's lines, with more than 12,000 backlit advertising panels on platforms and in corridors, as well as around 500 digital screens, creative solutions, advertising in trains (excluding TV advertising in trains and on platforms and 200 LCD screens).
In September, JCDecaux SE announced that it has been awarded a 10-year contract with ViaQuatro, which is responsible for the operation and maintenance concession of Line 4-Yellow of the São Paulo metro, to take over the advertising concession of this Line. The commercial offering will start on October 1st, 2022. JCDecaux already operates advertising on the Green-L1, Red-L2 and Blue-L3 lines, reaching more than 4.5 million people daily. With the addition of the Yellow Line-L4, which spans 12 km and includes 11 stations, JCDecaux will become the leading metro advertising company in Brazil – reaching 5.2 million passengers daily.
In January, JCDecaux announced it has achieved Gold Medal status from EcoVadis – the internationally recognised rating agency present in 160 countries with a network of 75,000 rated companies – for its CSR performance and sustainable procurement with a score of 71/100. This detailed assessment measures the maturity of policies as well as the actions undertaken based on 21 criteria grouped into four main themes: Environment, Labour and Human Rights, Ethics and Sustainable Procurement. This year's Gold Medal awarded to JCDecaux puts it in the Top 3% of the best performing companies assessed by EcoVadis. Indeed, the company is just two percentage points away from the Platinum Medal, the highest distinction awarded by EcoVadis.
In January, JCDecaux announced that it has successfully placed 8-year notes for a principal amount of €500 million, maturing on February 7th 2030. The spread has been fixed at 135 basis points above the swap rate leading to a coupon of 1,625%. Subscribed more than 3 times, this note has been placed with investors of high quality. The success of this new issuance highlights both the quality of JCDecaux's signature and the investor's confidence in the rebound capacity and in the growth potential of the Group. The proceeds of this issuance will be dedicated to general corporate purposes and to the refinancing of existing debts. With this transaction, JCDecaux continues to manage dynamically its balance sheet.
In May, JCDecaux has unveiled its ESG strategy for the next eight years, ahead of world Environment Day. This aims to support the circular economy, promote outdoor advertising as a catalyst for ecological and social transition and work towards the decarbonisation of the economy and society. This aligns with the French National Low-Carbon Strategy, through the Climate & Resilience law provisions for more sustainable public procurement, the Green Pact for Europe and the United Nations' Sustainable Development Goals (SDG).
In July, JCDecaux SE announced that it has signed a strategic alliance, including the acquisition of a majority stake, with Displayce, the DSP (Demand Side Platform) leader specialised in the purchasing and optimisation of digital outdoor advertising (DOOH). Displayce, a French start-up created in 2014 and exclusively dedicated to the purchasing and optimisation of DOOH campaigns, is the leading French programmatic platform in terms of the technology, expertise and number of digital displays proposed throughout the world, with more than 600,000 screens in over 50 countries. Displayce is connected to the main market DOOH SSPs (Supply Side Platforms) such as VIOOH, BROADSIGN and VISTAR MEDIA and offers media buying with advanced targeting and efficient bespoke solutions thanks to its Data Management Platform (DMP) designed specifically for DOOH advertising.
In September, JCDecaux SE announced that Pernod Ricard and JCDecaux, two major French-based global companies, have launched an innovative digital partnership in data management through the roll-out of a solution called Data Portal. This solution enables a company to centralise, in a single point, all the data from its different entities around the world, facilitating their use and sharing. The Data Portal is aligned with the transformation objectives of both Groups, who have placed data at the heart of their business and growth strategy.
In October, JCDecaux SE announced that the registration of JCDecaux SA as a European Company, which was approved by the Combined General Meeting of Shareholders on May 14th 2020, became effective in the Trade and Companies Register on September 27th 2022.
In December 2022, JCDecaux SE announced that it has been awarded the "Platinum" medal by EcoVadis for its ESG performance and responsible procurement, with an overall score of 76/100, much higher than the average for the "Advertising and market research" sector which stands at 43/100. Having won the "Gold" medal in 2021 with a score of 71/100, this year the Group has been given the highest level of recognition awarded by EcoVadis, to move up to among the top 1% of the most exemplary companies.
In December, JCDecaux SE announced the acquisition by its subsidiary JCDecaux France of Pisoni, a French player in street furniture and outdoor advertising in the south of France.A family-owned company created in 1987 by Jean-Pierre Pisoni, it employs 37 staff and currently operates 4,306 advertising panels in the Mediterranean basin, including 2,066 street furniture advertising panels within the framework of public concessions (48% of the portfolio) and 2,240 large format advertising panels in the private sector (52% of the portfolio). Pisoni also offers digital printing services via its company Tendance Pixxl.
In June, JCDecaux announced that its UK subsidiary JCDecaux UK has added programmatic buying capabilities to its advertising locations at London's Heathrow airport. The offering will connect advertisers and media buyers to advertising inventory via VIOOH, the leading premium global digital out-of-home supply-side platform. Advertisers will be able to blend the precision targeting and flexibility of programmatic buying with the effectiveness of high-impact digital Out-of-Home (DOOH), the media with the second highest growth after mobile advertising, at Heathrow, the UK's busiest airport and a leading international travel hub.
In January, JCDecaux announced that the vel'OH! service posted a record 400% increase in rentals in 2021 versus 2018. The vel'OH! system is included in the contract won by JCDecaux in 2017 that focuses on street furniture and electric self-service bikes in Luxembourg City. Luxembourg City is one of the first European capital cities to benefit from a service with 100% self-service electric bikes.
In September, JCDecaux SE announced that it has increased its stake in Interstate JCDecaux, LLC from 50% to 100%. JCDecaux North America is now the sole owner of the company which operates the 52-face Chicago Expressway Digital Billboard Network under a long-term agreement with the City of Chicago. All 52 digital billboard faces, most of which are 20 feet by 60 feet, are in the City of Chicago, which is the third largest media market in North America.
In June, JCDecaux announced the launch of its programmatic DOOH offering for the Brazilian market. Using the VIOOH platform, JCDecaux will be able to offer its clients effective programmatic digital out-of-home campaigns on its premium screens across Brazil, helping brands make meaningful connections with consumers and ensuring they get the most out of their media budgets.
Commenting on the 2022 results, Jean-Charles Decaux, Chairman of the Executive Board and Co-CEO of JCDecaux, said:
«As far as Q1 2023 is concerned, we now expect an organic revenue growth rate at around +2.5% including a double-digit revenue decline in China where we start seeing an inflection point from March as mobility is returning to normal.»
* * *
Paragraph 10 of the "Notes to the annual consolidated financial statements" on page 84 reports on related parties.
The Group faces a number of internal and external risks that may affect its business, its financial position or whether it achieves its objectives.
As specified in the previous chapter, in accordance with the European Regulation of 14 June 2017, the Group ranks each of the risks identified as specific and material, and then groups them into six major risk categories, which include the main risks dealt with in the Declaration of Extra-Financial Performance.
As part of its 2022 risk review, the Group has identified 111 risks, which the main ones are detailed in the following chapters.
The ten most significant risks are presented in the chart below:
Since the start of the pandemic, JCDecaux has had to face many challenges covered by several mapping risks: General issues:
• Risk related to the deterioration of the economic environment (major risk detailed below),
• Risk related to the decline in urban audiences and in the means of transport;
Numerous operational challenges:
Human issues:
• Risk related to events that could endanger the lives of employees,
• Risk related to the inability to manage psychological risks and ensure the well-being of teams (following a crisis);
The Group has implemented specific actions related to each of these challenges.
In this category, the Group has identified risks relating to business ethics at various stages of the value chain: in relations with its customers (advertisers, agencies, etc.), with its contracting authorities (cities, local authorities, transport management companies, etc.) or with its suppliers. The risk related to non-responsible tax practices is also included in this category.
The main risk relating to this family is a risk addressed under the Statement of Non-Financial Performance: this is the risk related to business ethics and the fight against corruption.
| Risk factor | Impact | Likehood | Net risk assessment |
|---|---|---|---|
| 2.1.2. Corruption fraud collusion risks | |||
| Risk related to business ethics and | *** | ** | * |
| anti-corruption [DEFP] |
The Group's activity is closely linked to the quality and integrity of relations with contracting authorities (cities, local authorities, transport management companies, etc.). Its reputation and its history of integrity are essential elements in its business and helps them access various public and private contracts.
Ethical business conduct is also a key factor in preserving long-term relationships with the Group's advertisers and partners, and in maintaining its reputation for excellence in the market.
JCDecaux is also particularly vigilant in respect of business ethics when making acquisitions, particularly in countries deemed sensitive in terms of corruption.
In 2001, the Group published a Code of Ethics setting out the principles and ethical rules to be followed in conducting the Group's business.
The Code was reviewed in 2018, as part of the implementation of the Sapin II Law in France and is communicated to all the Group's companies and employees.
The Code of Ethics, its method of distribution and the Ethics Committee that oversees its proper implementation, are presented in Universal Registration Document.
All information concerning the risk monitoring and management related to business ethics and the fight against corruption is available in the "Maintain ethical conduct and fight against corruption" of the Universal Registration Document.
| Risk Factor | Impact | Likelihood | Net Risk Assessment |
|---|---|---|---|
| 2.1.3. Compliance risks | |||
| RISK RELATED TO NON-RESPECT OF HUMAN RIGHTS/EMPLOYEES [DEFP] |
*** | ** | * |
| RISK RELATED TO NON-RESPECT OF HUMAN RIGHTS/SUPPLIERS [DEFP] |
*** | ** | * |
| RISK RELATED TO PERSONAL DATA PROTECTION AND NON-RESPECT OF PERSONAL PRIVACY [DEFP] |
*** | ** | * |
The JCDecaux Group operates in more than 80 countries, and 21% of the Group's FTEs are located in countries that have not ratified all the Fundamental Conventions of the International Labour Organization. However, all employees of the Group should have their fundamental human rights respected, as stated in the JCDecaux International Charter of Fundamental Social Values.
All information concerning the monitoring and management of human rights risks is available in the chapter "Guarantee respect for fundamental social values", of the Universal Registration Document.
Suppliers are at the heart of the Group's quality processes. JCDecaux has chosen to entrust the production of its products and solutions to trusted third parties. Some of these suppliers are located in countries that have not ratified all the Fundamental Conventions of the International Labour Organisation. However, JCDecaux requires its suppliers to comply with these international standards through its Supplier Code of Conduct, whose ratification is required.
All information concerning the monitoring and management of these risks is available in the chapter "Maintain ethical conduct and fight corruption- Managing our supplier relationships" of the Universal Registration Document.
In the digital and connected age, data are at the core of JCDecaux's business lines. In the course of the activities and services provided by the Group, which among other things covers Wi-Fi access, self-service bicycles, commercial relations, events, websites, and interactive advertising processes and campaigns, JCDecaux may collect and process personal data relating to thousands of third parties. Itis its responsibility to guarantee to protect the privacy and personal data of each of these parties, as well as their rights under applicable law.
In order to reduce the risk associated with non-responsible processing or data breaches, JCDecaux has set up a dedicated system:
• a specific governance structure has been put in place: formation of a "GDPR" steering committee, appointment of a Data Protection Officer (DPO) or Privacy Manager at each subsidiary located within the EU, involvement of the Legal Department in each non-EU country;
• Group policies and procedures dedicated to the personal data protection have been published and implemented across all the entities;
• training initiatives (digital learning) have been carried out to raise awareness of these issues among all personnel;
• In order to ensure the security of the Information Systems, a Chief Information Security Officer, assisted by a network of regional correspondents and Information Security Managers present in each of the Group's countries, implements JCDecaux's IT Security Policy.
All information concerning the monitoring and management of these risks is available in the chapter "Ensure that personal data is protected", of the Universal Registration Document.
As a result of its business, the Group may be exposed to varying degrees of financial risks (especially liquidity and financing risk, interest rate risk, foreign exchange rate risk and risks related to financial management, in particular, counterparty risk). All information regarding financial risks is available in the section "Notes to the consolidated financial statements", of the Universal Registration Document.
The two main risks identified in this family are as follows:
| Risk factor | Impact | Likelihood | Net Risk Assessment |
|---|---|---|---|
| 2.1.4. Financial risks | |||
| MARKET RISK - RELATED TO THE ECONOMIC ENVIRONMENT |
*** | *** | *** |
| RISK RELATED TO THE INCREASE IN REGULATORY MEASURES TO REDUCE ADVERTISING |
*** | *** | *** |
In the event of a worldwide recession, the advertising and communications sector is quite susceptible to business fluctuations as many advertisers may cut their advertising budgets.
The economic crisis following the Covid-19 health crisis is a perfect illustration of this risk of a sudden and unpredictable downturn in the markets.
The Group must also deal with the cyclical nature of the advertising market. Our line of business is strongly linked to changes in the GDP in the countries where the Group operates. A significant increase or downturn in the economic activity of a country may substantially impact the Group's business and revenue.
The Group's operations in geographically diverse markets minimise the impact of a possible across-the-board decline in the sector, since reactions are disparate and occur at different times on markets in the various countries where it operates. The breakdown of revenue by geographic area is presented in the Universal Registration Document.
The Group management and its Finance Department are particularly attentive to cost structures and adopt action plans to maintain the Group's profitability.
As a rule, the outdoor advertising industry is subject to significant government regulation at both the national and local level in the majority of countries where the Group operates, relating to the type (analogue/digital display), luminosity, density, size and location of billboards and street furniture in urban and other areas.
Local regulations, however, are generally moving in the direction of reducing the total number of advertising spaces, and/or reducing their size, and local authorities are becoming stricter in applying existing law and regulations. Some advertising spaces, particularly billboards, could therefore have to be removed or relocated in certain countries in the future.
In France, where regulatory pressure is strong and long-standing (notably via the Local Advertising Regulations which regulate outdoor facilities), JCDecaux has a dedicated organisation and skills (via the Institutional Relations Department, the Regulatory Coordination Department and a Public Affairs Unit composed of specialised lawyers) to oversee the application of regulations and monitor any changes in them, in order to anticipate and better manage this risk.
In our other regions, we have not identified any similar pressure at this stage requiring the implementation of an organisation similar to the one present in France.
In addition, with regard to the environment, the main subject of legislative proposals, the Group has taken numerous measures for several years. JCDecaux is the only company in the outdoor advertising sector worldwide to have joined the RE 100 in 2019 (international coalition of companies committed to the 100% renewable energy objective). In 2022, JCDecaux was maintained at the "Leadership" level of the CDP (Carbon Disclosure Project) and is part of the prestigious List A, as in 2019. The Group is also referenced in terms of extra-financial performance in the FTSE4Good index and the MSCI ranking. For many years, the group has been mobilised in terms of environmental com-mitment, and in 2021 will contribute to collective carbon neutrality for its France subsidiary.
The Group is also rated Platinum by EcoVadis, corresponding to the highest distinction, and is also listed in the FTSE4Good index and the MSCI ranking. For many years, the group has been mobilised in terms of environmental commitment, and in 2021 contributed to the collective carbon neutrality for its French subsidiary.
In 2022, JCDecaux defined a Group-wide Climate Strategy. For the Group, this means aligning itself with the ambitions of the Paris Agreement and achieving Net Zero Carbon by 2050 by committing to a Science-Based Targets (SBTi) trajectory. During 2023, the Group plans to submit its reduction trajectory to SBTi for review and validation. More information is available in the chapter "Actively contribute to the planet's carbon neutrality" of the Universal Registration Document.
Through its activity, the Group may be confronted with several strategic risks: the ability to address changes in business models or the sudden drop in audiences are just some of them, as is the treatment of climate and environmental risks. The main risks of this family are as follows:
| Risk factor | Impact | Likelihood | Net Risk Assessment |
|---|---|---|---|
| 2.1.5. Strategic risks | |||
| RISK OF IT ATTACKS ON KEY BUSINESS SYSTEMS | *** | *** | ** |
| RISK OF ONLINE HACKING OF FURNITURE AND DISSEMINATION OF INAPPROPRIATE CONTENT [DEFP] |
*** | *** | * |
The Group uses complex information systems to support its commercial, industrial and management activities. The main risks are related to the integrity and maintenance of the operational capacity of its systems.
The Group's information systems are protected on several levels: data centres are secured, access to software controlled and our billboard systems audited. These protections concern in particular the computer platform used for the preparation and dissemination of digital advertising campaigns. This platform relies on a private network and is operated by the JCDecaux teams in accordance with strict end-to-end control and audit rules. It is monitored 24/7 in order to detect and deal with any operational anomalies in real time.
In addition, business recovery plans aimed at ensuring the continuity of our operations are tested several times a year. Moreover, in order to improve the security of IT systems on a continuous basis and to limit the consequences of any malfunctions, the various risks (incidents affecting data centres, failure of equipment or telecommunications systems, security breaches, human error, etc.) are regularly assessed. Based on these assessments, the resources in place are strengthened and/or new protective measures developed to clamp down on any attempted security breaches, disclosure of confidential information, data loss or corruption, loss of traceability, etc Finally, the Group has supplemented its IT policy by taking out a Cyber Enterprise Risk Management insurance policy with a leading insurance company to cover the financial consequences of a breach of the IT systems and personal or confidential data held and managed by the Group.
JCDecaux distributes digital campaigns in 67 countries through almost 245,000 advertising panels. Any external or internal attempt to access the digital screens of the Group's street furniture in order to advertise uncontrolled messages is a major risk, which could affect its results, reputation and its ability to provide a credible digital offering to advertisers. The main risks identified include vandalism or service disruptions. The more offensive and harmful the messages disseminated, the more serious the impacts will be.
JCDecaux has implemented a comprehensive IT policy in place for several years to protect itself against the risk of attempts to hack its digital content. Under the Corporate responsibility of the Infrastructure Department, which reports to the Group's Chief Information Officer and in fine to the Chief Financial, IT and Administrative Officer, a robust IT security policy has been put in place, with the deployment of architecture principles at Group level and applicable in all countries, as well as 24/7 monitoring and surveillance tools, notably via a SOC, operating procedures and guides, control systems (audits, vulnerability tests, etc.), cybersecurity monitoring work, in order to ensure the coverage of all identified risks.
All information concerning the monitoring and management of these risks is available in the chapter "Safeguard our digital activities to the highest possible degree", in the Universal Registration Document.
In this category, the Group has identified the operating risks related to these various activities (in particular when selling advertising spaces or during bill-posting, cleaning and maintenance activities). This category deals in particular with risks related to the development of human capital, the risk of harassment or the risk of losing a key employee of the Company.
The two main risks relating to this family are two risks covered by the Declaration of Extra-Financial Performance.
| Risk factor | Impact | Likelihood | Net Risk Assessment |
|---|---|---|---|
| 2.1.6. Operating & HR risks | |||
| Risk related to health and safety of employees and suppliers [DEFP] |
*** | *** | ** |
| Attraction and retention of talent [DEFP] | *** | ** | ** |
There are more than 400 different skills within JCDecaux, from the design of street furniture to the marketing of advertising space, not forgetting the upkeep and maintenance of furniture and advertising spaces. Operational and field staff, which represented approximately 51% of the Group's total workforce in 2021, are more exposed to the risks of accidents and incidents through their activities. These may include working at height, the use of electricity or the proximity to electrical equipment, road driving or work close to roads or railways, work in places where the "density" of the public is considerable (airports, railway stations, metro systems, pavements, etc.).
All information concerning the monitoring and management of these risks is available in the chapter "Promoting an exemplary Health & Safety culture" in the Universal Registration Document.
In a general context of a shortage of candidates, JCDecaux must be attractive on the job market to attract new talent on the one hand, and efficient as an employer to ensure their retention on the other. To this end, the Group strives not only to create working conditions conducive to the fulfilment and achievement of the ambitions of each of its employees, but also to gain visibility, notoriety and stand out in the employment market by reinforcing its employer brand. In 2022, "Talent attraction and retention" has been identified as a major risk. In 2022, the actions were rolled out for executives and managers, in particular in view of the findings made on IT populations. The Group plans to expand and roll out the actions already carried out in this regard, particularly in France, to all employees from 2023.
Information on the monitoring and management of these risks can be found in the chapter "Support employee growth and development", on the Universal Registration Document.
This category includes all the risks related to natural disasters or to external social, political or epidemiological factors.
The Group has operations in many countries and is therefore exposed to the effects of such events.
The Group considers that this presentation covers the main significant risks.
Risks deemed insignificant but presented in accordance with Article 173 of the Energy Transition Act of 17 August 2015 are described under "Sustainable Development" in the Universal Registration Document.
| In million euros | 31/12/2022 | 31/12/2021 | |
|---|---|---|---|
| Goodw ill |
§ 4.1 | 1,748.7 | 1,609.3 |
| Other intangible assets | § 4.1 | 624.0 | 514.4 |
| Property, plant and equipment | § 4.2 | 1,279.0 | 1,203.9 |
| Right-of-use | § 4.3 | 2,725.3 | 2,964.8 |
| Investments under the equity method | § 4.5 | 411.9 | 414.4 |
| Other financial assets | § 4.6 | 114.5 | 164.9 |
| Financial derivatives | - | - | |
| Deferred tax assets | § 4.11 | 209.9 | 142.0 |
| Current tax assets | § 4.19 | 2.7 | 3.1 |
| Other receivables | § 4.7 | 9.4 | 11.4 |
| NON-CURRENT ASSETS | 7,125.4 | 7,028.1 | |
| Other financial assets | § 4.6 | 4.8 | 17.6 |
| Inventories | § 4.8 | 161.7 | 143.1 |
| Financial derivatives | § 4.17 | 2.5 | 0.6 |
| Trade and other receivables | § 4.9 | 775.9 | 743.0 |
| Current tax assets | § 4.19 | 22.4 | 24.2 |
| Treasury financial assets | § 4.10 | 46.8 | 46.0 |
| Cash and cash equivalents | § 4.10 | 1,919.5 | 1,493.8 |
| CURRENT ASSETS | 2,933.5 | 2,468.3 | |
| TOTAL ASSETS | 10,058.9 | 9,496.4 |
| Share capital | 3.2 | 3.2 | |
|---|---|---|---|
| Additional paid-in capital | 608.5 | 608.5 | |
| Treasury shares | (2.0) | (2.8) | |
| Consolidated reserves | 1,152.8 | 1,169.8 | |
| Consolidated net income (Group share) | 132.1 | (14.5) | |
| Other components of equity | (131.3) | (144.1) | |
| EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT COMPANY | 1,763.3 | 1,620.2 | |
| Non-controlling interests | 36.2 | 23.4 | |
| TOTAL EQUITY | § 4.12 | 1,799.5 | 1,643.6 |
| Provisions | § 4.13 | 452.0 | 373.6 |
| Deferred tax liabilities | § 4.11 | 79.9 | 87.1 |
| Financial debt | § 4.14 | 1,916.4 | 2,116.7 |
| Debt on commitments to purchase non-controlling interests | § 4.15 | 102.9 | 106.5 |
| Lease liabilities | § 4.16 | 2,454.7 | 2,647.0 |
| Other payables | 10.2 | 9.2 | |
| Income tax payable | § 4.19 | 0.6 | 0.9 |
| Financial derivatives | § 4.17 | 0.0 | 0.0 |
| NON-CURRENT LIABILITIES | 5,016.8 | 5,341.0 | |
| Provisions | § 4.13 | 83.8 | 88.5 |
| Financial debt | § 4.14 | 993.3 | 336.9 |
| Debt on commitments to purchase non-controlling interests | § 4.15 | 4.6 | 5.3 |
| Financial derivatives | § 4.17 | 4.2 | 4.9 |
| Lease liabilities | § 4.16 | 957.3 | 1,008.8 |
| Trade and other payables | § 4.18 | 1,145.9 | 1,039.3 |
| Income tax payable | § 4.19 | 23.7 | 21.8 |
| Bank overdrafts | § 4.14 | 29.8 | 6.4 |
| CURRENT LIABILITIES | 3,242.6 | 2,511.8 | |
| TOTAL LIABILITIES | 8,259.4 | 7,852.8 | |
| TOTAL EQUITY AND LIABILITIES | 10,058.9 | 9,496.4 | |
| In million euros | 2022 | 2021 | |
|---|---|---|---|
| REVENUE | § 5.1 | 3,074.0 | 2,522.5 |
| Direct operating expenses | § 5.2 | (1,198.2) | (893.4) |
| Selling, general and administrative expenses | § 5.2 | (553.3) | (465.1) |
| OPERATING MARGIN | 1,322.5 | 1,163.9 | |
| Depreciation, amortisation and provisions (net) | § 5.2 | (1,072.8) | (1,076.3) |
| Maintenance spare parts | § 5.2 | (46.0) | (37.3) |
| Other operating income | § 5.2 | 80.9 | 45.3 |
| Other operating expenses | § 5.2 | (21.3) | (27.1) |
| EBIT | 263.4 | 68.6 | |
| Interests on IFRS 16 lease liabilities | § 5.3 | (84.1) | (82.2) |
| Financial income | § 5.3 | 13.4 | 4.2 |
| Financial expenses | § 5.3 | (64.8) | (49.1) |
| Net financial income excluding IFRS 16 | § 5.3 | (51.4) | (44.9) |
| NET FINANCIAL INCOME (LOSS) | (135.6) | (127.1) | |
| Income tax | § 5.4 | 22.3 | 13.6 |
| Share of net profit of companies under the equity method | § 5.5 | 8.6 | 48.6 |
| CONSOLIDATED NET INCOME | 158.7 | 3.6 | |
| - Including non-controlling interests | 26.6 | 18.1 | |
| CONSOLIDATED NET INCOME (GROUP SHARE) | 132.1 | (14.5) | |
| Earnings per share (in euros) | 0.621 | (0.068) | |
| Diluted earnings per share (in euros) | 0.621 | (0.068) | |
| Weighted average number of shares | § 5.7 | 212,733,422 | 212,833,760 |
| Weighted average number of shares (diluted) | § 5.7 | 212,733,422 | 212,833,760 |
| In million euros | 2022 | 2021 |
|---|---|---|
| CONSOLIDATED NET INCOME | 158.7 | 3.6 |
| Translation reserve adjustments (1) | 5.8 | 36.7 |
| Cash flow hedges | (1.5) | 0.5 |
| Tax on the other comprehensive income subsequently released to net income | 1.2 | (3.4) |
| Share of other comprehensive income of companies under equity method (after tax) (2) | (11.0) | 14.0 |
| Other comprehensive income subsequently released to net income | (5.6) | 47.8 |
| Change in actuarial gains and losses on post-employment benefit plans and assets ceiling | 25.5 | 12.8 |
| Tax on the other comprehensive income not subsequently released to net income | (4.3) | (3.9) |
| Share of other comprehensive income of companies under equity method (after tax) | 0.3 | (12.6) |
| Other comprehensive income not subsequently released to net income | 21.5 | (3.7) |
| Total other comprehensive income | 15.9 | 44.1 |
| TOTAL COMPREHENSIVE INCOME | 174.6 | 47.7 |
| - Including non-controlling interests | 29.7 | 18.7 |
| TOTAL COMPREHENSIVE INCOME - GROUP SHARE | 145.0 | 29.0 |
(1) In 2022, translation reserve adjustments mainly related to changes in foreign exchange rates, of which €19.1 million in Hong Kong, €7.9 million in Mexico, €(11.0) million in the United States and €(6.6) million in the United Kingdom.
In 2021, translation reserve adjustments mainly related to changes in foreign exchange rates, of which €21.4 million in Hong Kong, €8.9 million in the United Kingdom, €9.0 million in Australia and €(7.8) million in the United States. The item also included a €(4.3) million reclassification to net income related to changes in scope and a €1.6 million reclassification to net income following the disqualification of net foreign investments (including €0.5 million in France and €1.1 million in Argentina).
(2) In 2022, this includes €3.1 million in reclassification to net income of translation reserves from companies accounted for under the equity method following changes in consolidation scope.
| Equity attribuable to the owners of the parent company | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Share Capital |
Additionnal paid-in capital |
Treasury shares |
Retained earnings |
Other components of equity | Total | Non controlling interests |
Total | |||||||
| In million euros | Cash flow hedges |
Available for sale securities |
Translation reserve adjustments |
Revaluation reserves |
Actuarial gains and losses / assets ceiling |
Other | Total other components |
|||||||
| Equity as of 31 December 2020 | 3.2 | 608.5 | (1.5) | 1,172.5 | 0.8 | (0.1) | (125.9) | 0.9 | (64.0) | 0.8 | (187.5) | 1,595.4 | 17.7 | 1,613.0 |
| Capital increase (1) | 0.0 | 0.0 | 0.1 | 0.1 | ||||||||||
| Change in treasury shares (2) | (1.4) | 0.3 | 0.0 | (1.0) | (1.0) | |||||||||
| Purchase | (22.2) | 0.0 | (22.2) | (22.2) | ||||||||||
| Sale | 20.9 | 0.3 | 0.0 | 21.2 | 21.2 | |||||||||
| Distribution of dividends | 0.0 | 0.0 | 0.0 | (9.9) | (9.9) | |||||||||
| Share-based payments | 1.0 | 0.0 | 1.0 | 1.0 | ||||||||||
| Debt on commitments to purchase non-controlling interests (3) |
0.0 | 0.0 | 1.8 | 1.8 | ||||||||||
| Change in consolidation scope (4) | (4.4) | 0.0 | 0.0 | 0.0 | (4.4) | (4.6) | (9.0) | |||||||
| IFRS16 amendement (5) | 3.2 | 0.0 | 3.2 | 0.0 | 3.2 | |||||||||
| Consolidated net income | (14.5) | 0.0 | (14.5) | 18.1 | 3.6 | |||||||||
| Other comprehensive income | 0.4 | 46.8 | (3.7) | 43.5 | 43.5 | 0.6 | 44.1 | |||||||
| Total comprehensive income | 0.0 | 0.0 | 0.0 | (14.5) | 0.4 | 0.0 | 46.8 | 0.0 | (3.7) | 0.0 | 43.5 | 29.0 | 18.7 | 47.7 |
| Other | (2.8) | (0.1) | (0.1) | (2.9) | (0.4) | (3.3) | ||||||||
| Equity as of 31 December 2021 | 3.2 | 608.5 | (2.8) | 1,155.3 | 1.2 | (0.1) | (79.2) | 0.9 | (67.7) | 0.8 | (144.1) | 1,620.2 | 23.4 | 1,643.6 |
| Capital increase (1) | 0.0 | 0.0 | 0.3 | 0.3 | ||||||||||
| Change in treasury shares (2) | 0.8 | (0.2) | 0.0 | 0.6 | 0.6 | |||||||||
| Purchase | (43.1) | 0.0 | (43.1) | (43.1) | ||||||||||
| Sale | 43.9 | (0.2) | 0.0 | 43.7 | 43.7 | |||||||||
| Distribution of dividends | 0.0 | 0.0 | (17.8) | (17.8) | ||||||||||
| Share-based payments | 6.1 | 0.0 | 6.1 | 6.1 | ||||||||||
| Debt on commitments to purchase | ||||||||||||||
| non-controlling interests (3) | 0.0 | 0.0 | 0.7 | 0.7 | ||||||||||
| Change in consolidation scope (4) | (9.3) | 0.0 | 0.0 | 0.0 | (9.3) | (0.1) | (9.4) | |||||||
| Consolidated net income | 132.1 | 0.0 | 132.1 | 26.6 | 158.7 | |||||||||
| Other comprehensive income | (1.1) | (7.4) | 21.3 | 12.8 | 12.8 | 3.1 | 15.9 | |||||||
| Total comprehensive income | 0.0 | 0.0 | 0.0 | 132.1 | (1.1) | 0.0 | (7.4) | 0.0 | 21.3 | 0.0 | 12.8 | 145.0 | 29.7 | 174.6 |
| Other | 0.8 | 0.1 | (0.1) | (0.0) | 0.0 | (0.0) | 0.8 | (0.1) | 0.7 | |||||
| Equity as of 31 December 2022 | 3.2 | 608.5 | (2.0) | 1,284.8 | 0.2 | (0.2) | (86.6) | 0.9 | (46.4) | 0.8 | (131.3) | 1,763.3 | 36.2 | 1,799.5 |
(1) Increases in the share capital of controlled entities.
(2) Change in treasury shares of JCDecaux SE under the liquidity agreement entered in May 2019.
(3) In 2022, reversal of a debt following the non-exercise of a put option by the partner. In 2021, payment to a partner of the purchase commitment of its stake in a controlled entity. Revaluation and discounting effects on commitments to purchase non-controlling interests are recorded in the income statement under "Consolidated net income" as "Non-controlling interests" for €3.6 million in 2022 and €(2.1) million in 2021.
(4) In 2022, changes in consolidation scope related to the acquisition of non-controlling interests in United Arab Emirates and a restructuring effect in China. In 2021, changes in consolidation scope related to the acquisition of non-controlling interests in the United Kingdom and the restructuring of a group of entities in China.
(5) After-tax impact of the application of the IFRS 16 amendment for rent reductions obtained in 2020.
| In million euros | 2022 | 2021 | |
|---|---|---|---|
| NET INCOME BEFORE TAX | 136.5 | (10.0) | |
| Share of net profit of companies under the equity method | § 5.5 | (8.6) | (48.6) |
| Dividends received from companies under the equity method | § 11.4 & § 12.3 | 51.4 | 28.6 |
| Expenses related to share-based payments | § 5.2 | 6.1 | 1.0 |
| Gains and losses on lease contracts | § 5.2 | (48.9) | (200.5) |
| Depreciation, amortisation and provisions (net) | § 5.2 & § 5.3 | 1,074.3 | 1,070.2 |
| Capital gains and losses and net income (loss) on changes in scope | § 5.2 & § 5.3 | (67.2) | (12.0) |
| Net discounting expenses | § 5.3 | (2.0) | 3.6 |
| Net interest expense & interest expenses on IFRS16 lease liabilities | § 5.3 | 126.3 | 119.9 |
| Financial derivatives, translation adjustments, amortised cost and other | (0.4) | 0.1 | |
| Interest paid on IFRS16 lease liabilities | § 4.16 | (93.8) | (63.7) |
| Interest paid | (45.9) | (41.9) | |
| Interest received | 9.7 | 2.9 | |
| Income tax paid | (44.9) | (13.4) | |
| Operating Cash Flows | 1,092.6 | 836.1 | |
| Change in working capital | 7.0 | 165.7 | |
| Change in inventories | (15.6) | 33.0 | |
| Change in trade and other receivables | (15.7) | (12.9) | |
| Change in trade and other payables | 38.2 | 145.6 | |
| NET CASH FLOWS FROM OPERATING ACTIVITIES | § 6.1 | 1,099.6 | 1,001.8 |
| Cash payments on acquisitions of intangible assets and property, plant and equipment | (351.2) | (169.0) | |
| Cash payments on acquisitions of financial assets (long-term investments) net of cash acquired | (89.4) | (16.3) | |
| Cash payments on acquisitions of other financial assets | (4.0) | (21.6) | |
| Total investments | (444.6) | (207.0) | |
| Cash receipts on proceeds on disposals of intangible assets and property, plant and equipment | 9.4 | 18.7 | |
| Cash receipts on proceeds on disposals of financial assets (long-term investments) net of cash sold |
0.3 | 0.3 | |
| Cash receipts on proceeds on disposals of other financial assets | 18.0 | 17.9 | |
| Total asset disposals | 27.7 | 37.0 | |
| NET CASH FLOWS FROM INVESTING ACTIVITIES | § 6.2 | (416.9) | (170.1) |
| Dividends paid | (17.8) | (9.9) | |
| Purchase of treasury shares | (43.1) | (22.2) | |
| Cash payments on acquisitions of non-controlling interests | (6.3) | (2.6) | |
| Capital decrease | (0.1) | 0.0 | |
| Repayment of long-term borrow ings |
§ 6.4 | (1,179.2) | (1,501.7) |
| Repayment of lease liabilities | § 4.16 | (702.5) | (647.8) |
| Acquisitions and disposals of treasury financial assets | 0.0 | 12.5 | |
| Cash outflow from financing activities | (1,949.0) | (2,171.8) | |
| Cash receipts on proceeds on disposal of interests w ithout loss of control |
0.0 | 0.0 | |
| Capital increase | 0.5 | 0.2 | |
| Sale of treasury shares | 43.7 | 21.2 | |
| Increase in long-term borrow ings |
§ 6.4 | 1,623.9 | 1,216.1 |
| Cash inflow from financing activities | 1,668.2 | 1,237.4 | |
| NET CASH FLOWS FROM FINANCING ACTIVITIES | § 6.3 | (280.8) | (934.4) |
| CHANGE IN NET CASH POSITION | 401.8 | (102.7) | |
| Net cash position beginning of period | § 4.14 | 1,487.4 | 1,593.6 |
| Effect of exchange rate fluctuations and other movements | 0.5 | (3.6) | |
| Net cash position end of period (1) | § 4.14 | 1,889.7 | 1,487.4 |
(1) Including €1,919.5 million in cash and cash equivalents and €(29.8) million in bank overdrafts as of 31 December 2022, compared to €1,493.8 million and €(6.4) million respectively as of 31 December 2021.
The JCDecaux SE consolidated financial statements for the year ended 31 December 2022 include JCDecaux SE and its subsidiaries (hereinafter referred to as the "Group") and the share of the Group's equity in associates and joint ventures.
Pursuant to European Regulation No. 1606/2002 of 19 July 2002, the 2022 consolidated financial statements were prepared in accordance with IFRS, as adopted by the European Union. They were approved by the Executive Board and authorised for release by the Supervisory Board on 8 March 2023. These financial statements shall only be considered final upon approval by the General Meeting of Shareholders.
The values shown in the tables are generally expressed in millions of euros. The sum of the rounded amounts may differ, albeit insignificantly, from the reported values.
The principles used for the preparation of these financial statements are based on:
The accounting policies adopted are identical to those used for the preparation of the consolidated financial statements for the year ended 31 December 2021, with the exception of the adoption of the following amendments to standards and interpretations adopted by the European Union and applicable from 1 January 2022:
The application of these amendments, interpretations and standards has had no significant impact on the consolidated financial statements.
In the absence of specific IFRS provisions on the accounting treatment of debts on commitments to purchase noncontrolling interests, the accounting principles used in the previous consolidated financial statements have been maintained and are explained in Note 1.19 "Commitments to purchase non-controlling interests". In particular, subsequent revaluation and discounting effects of the debt arising from such commitments are recognised in net financial income and allocated to non-controlling interests in the income statement, with no impact on the net income Group share.
In addition, the Group has opted not to apply in advance the new standards, amendments to standards and interpretations adopted by the European Union when their application became mandatory only after 31 December 2022.
The financial statements of companies controlled by the Group are included in the consolidated financial statements from the date on which control is acquired to the date at which control ends.
The equity method is adopted for joint ventures and for associates, companies over which the Group exercises a significant influence on operating and financial policies.
All transactions between fully-consolidated Group companies are eliminated upon consolidation.
Inter-company results are also eliminated. Capital gains or losses on inter-company sales carried out by a company consolidated under the equity method are eliminated up to the percentage of ownership and offset against the value of the assets sold. Capital losses realised on inter-company sales to an equity-accounted company are governed by IFRS3R and capital gains realised on sales to an equity-accounted company fall under SIC13.
Transactions denominated in foreign currencies are translated into the functional currency of the entity at the rate prevailing on the transaction date. At the end of the period, monetary items are translated at the closing exchange rate and the resulting gains or losses are recorded in the income statement.
Long-term monetary assets held by a Group entity on a foreign subsidiary for which settlement is neither planned nor likely to occur in the foreseeable future are a part of the entity's net investment in a foreign operation. Accordingly, pursuant to IAS 21 "The Effects of Changes in Foreign Exchange Rates", exchange differences on these items are recorded in other comprehensive income until the investment's disposal or disqualification. Otherwise, exchange differences are recorded in the income statement.
The Group's consolidated financial statements are prepared in euros, the presentation and functional currency of the parent company.
Assets and liabilities of foreign subsidiaries are translated into the Group's presentation currency at the closing exchange rate, and the corresponding income statement is translated at the average exchange rate for the period. Resulting translation adjustments are directly allocated to other comprehensive income.
At the time of a total or partial disposal, with loss of control, the liquidation of a foreign entity, or a step acquisition giving control, translation adjustments accumulated in equity are reclassified in the income statement.
Under the process of preparing the consolidated financial statements, the valuation of some assets and liabilities requires the use of judgments, assumptions and estimates. This primarily involves the determination of the amount of lease liabilities and right-of-use, the valuation of goodwill, property, plant and equipment and intangible assets, the valuation of investments under the equity method, determining the amount of provisions for employee benefits and dismantling, provisions for onerous contracts and the valuation of commitments on securities. These judgments, assumptions and estimates are based on information available or situations existing at the financial statement's date of preparation, which in the future could differ from reality particularly in the context of the global crisis (linked to the Covid-19 pandemic, rising interest rates, inflation and the war in Ukraine), creating growing uncertainties over the future outlook.
Valuation methods are described in more detail, mainly in Note 1.10 "Impairment of intangible assets, property, plant and equipment, right-of-use and goodwill", in Note 1.11 "Leases", in Note 1.12 "Investments under the equity method", in Note 1.20 "Provisions for retirement and other long-term benefits", and in Note 1.21 "Dismantling provisions". The results of sensitivity tests are provided in Note 4.4 "Goodwill, Property, plant and equipment (PP&E), intangible asset and right-of-use impairment tests" for the valuation of goodwill, property, plant and equipment, intangible assets and right-of-use, in Note 4.5 "Investments under the equity method and impairment tests" for the valuation of investments under the equity method, in Note 4.20 "Financial assets and liabilities by category" for the valuation of debt on commitments to purchase non-controlling interests and in Note 4.13 "Provisions" for the valuation of dismantling provisions and provisions for employee benefits.
With the exception of deferred tax assets and liabilities which are classified as non-current, assets and liabilities are classified as current when their recoverability or payment is expected no later than 12 months after the yearend closing date; otherwise, they are classified as non-current.
According to IAS 38, development costs must be capitalised as intangible assets if the Group can demonstrate:
the existence of probable future economic benefits for the Group,
the high probability of success for the Group,
Development costs capitalised in the statement of financial position include costs related to the development of or modification or improvement to the array of street furniture product lines and advertising structures in connection with contract proposals with a strong likelihood of success. Development costs also include the design and construction of models and prototypes.
The Group considers that it is legitimate to capitalise costs for the preparation of bids in response to calls for tender. Given the nature of the costs incurred (design and construction of models and prototypes) and the statistical success rate of the JCDecaux Group in its responses to tenders, the Group believes that these costs constitute development activities that can be capitalised under the aforementioned criteria. Indeed, said costs are directly related to a given contract and are incurred to win it. Amortisation, spread out over the term of the contract, begins when the project is awarded. Should the bid be lost, the amount capitalised is expensed.
Development costs carried in assets are recognised at cost less accumulated amortisation and impairment losses.
Other intangible assets primarily involve Street Furniture, Billboard and Transport contracts recognised in business combinations, which are amortised over a period corresponding to the time necessary for the cumulative discounted flows used for the valuation of the assets to cover almost all the assets. They also include upfront payments, amortised over the term of the contract, and software. Only individualised and clearly identified software (ERP in particular) and for which the Group has the control, is capitalised and amortised over a maximum period of 10 years. Other software expenses are recognised in expenses for the period.
Goodwill represents the fair value of the consideration transferred (including the acquisition-date fair value of the acquirer's previously held equity interest in the company acquired), plus the amount recognised for any noncontrolling interest in the acquired company, minus the net amount recognised in relation to the identifiable assets acquired and the liabilities measured at their fair value.
Goodwill is not amortised. The Group conducts impairment tests at least once a year at each statement of financial position date and at any time when there are indicators of impairment. Following these impairment tests, performed in accordance with the methodology described in Note 1.10 "Impairment of intangible assets, property, plant and equipment, right-of-use and goodwill", a goodwill impairment loss is recognised if necessary. When recognised, such a loss cannot be reversed at a later period.
Negative goodwill, if any, is immediately recognised directly in the income statement.
When determining the fair value of the assets and liabilities of the acquired entity, the Group is most notably required to value contracts and recognise these items as intangible assets for their fair value, taking into account the residual term of the contracts and a probability of renewal for street furniture and transport activities, and a principle of attrition for billboard contracts. The intangible assets thus recognised are amortised over a period corresponding to the time necessary for the cumulative discounted flows used for the valuation of the assets to cover almost all the assets. When an onerous contract is identified, the Group decreases the gross amount of right-of-use attached to the contract and recognises any resulting liability. This liability corresponds to the unavoidable net costs attached to this contract, i.e., the rent and fees and costs directly incurred, including labour costs and direct administrative costs. And when there is an exit clause that costs less than the costs related to the continuation of the contract, it is this exit clause that is provisioned.
Under IFRS, companies are granted a 12-month period, starting from the date of acquisition, to finalise the fair value measurement of the assets and liabilities acquired.
Acquisition-related costs are recognised by the Group in other operating expenses, except for acquisition-related costs for non-controlling interests, which are recorded in equity.
For staged acquisitions, any gain or loss arising from the fair value revaluation of the previously held equity interest is recorded in the income statement under other operating income and expenses at the time control is acquired. The fair value of this revaluation is estimated on the basis of the purchase price less the control premium.
For every partial or complete disposal with loss of control, any gain or loss from the disposal as well as the remeasurement of retained interest are recorded in the income statement under other operating income and expenses.
Furthermore, for acquisitions of non-controlling interests in controlled companies and the sale of interests without loss of control, the difference between the acquisition price or sale price and the carrying value of non-controlling interests is recognised in changes in equity attributable to owners of the parent company. The corresponding cash inflows and outflows are presented under "Net cash flows from financing activities" on the statement of cash flows.
Property, plant and equipment (PP&E) are presented in the statement of financial position at historical cost less accumulated depreciation and impairment losses.
Street furniture (bus shelters, MUPIs®, Seniors, Electronic Information Boards (EIB), Automatic Public Toilets, Morris Columns, etc.) and advertising panels for the transport business are depreciated on a straight-line basis over the term of the contracts between 8 and 25 years. Digital screens are depreciated over a 5 to 10-year period; their economic life-span can be shorter than the term of the contracts. Street furniture maintenance costs are recognised as expenses.
The expected discounted dismantling costs at the end of the contract are recorded under assets, with the corresponding provision, and amortised over the term of the contracts.
Billboards are depreciated according to the method of depreciation prevailing in the relevant countries in accordance with local regulations and economic conditions.
The main method of depreciation is the straight-line method over a period of 2 to 20 years.
Street furniture and billboard assets of the Group are insured against risks related to climatic events and their adaptation to these events is guaranteed by the carrying out of resistance tests. The amortisation periods are therefore determined according to normal durations of use; weather hazards are controlled through this insurance and through the tests carried out.
Property, plant and equipment:
| ▪ | Buildings and constructions | 10 to 50 years |
|---|---|---|
| ▪ | Technical installations, tools and equipment (excluding street furniture and billboards) |
5 to 10 years |
| ▪ | Street furniture and billboards | 2 to 25 years |
| Other property, plant and equipment: | ||
| ▪ | Fixtures and fittings | 5 to 16 years |
| ▪ | Transport equipment | 3 to 15 years |
| ▪ | Computer equipment | 3 to 5 years |
▪ Furniture 5 to 10 years
Items of property, plant and equipment, intangible assets and right-of-use as well as goodwill are tested for impairment, under IAS 36 standard, at least once a year.
Impairment testing consists in comparing the net book value of a Cash-Generating Unit (CGU) or a CGU group with its recoverable amount. The recoverable amount is either (i) the fair value of the asset (or group of assets) minus costs of disposal, or (ii) the value in use determined on the basis of future discounted cash flows, whichever is the greater.
When the recoverable amount is assessed on the basis of the value in use, cash flow forecasts are determined using growth assumptions based either on the term of the contracts, or over a five-year period with a subsequent perpetual projection and a discount rate reflecting current market estimates of the time value of money. The growth assumptions used do not take into account any external acquisitions. Risks specific to the tested CGU are reflected in the assumptions adopted for determining the cash flows and the discount rate used.
The risks and impacts related to climate change are taken into account in the impairment test assumptions but have no significant impact for the Group. Indeed, JCDecaux's assets are insured against risks related to climatic events, which limits the risk of financial impact from this type of event on the Group. In this way, future economic flows are secured and are not impacted by weather hazards. The additional investments and operating expenses incurred by the subsidiaries to achieve ESG (Environmental, Social and Governance) objectives and related to climate and environmental issues (such as the purchase of carbon certificates, etc.) have been taken into account in the preparation of the country budgets but the latter do not currently represent a sufficiently material amount to weigh significantly on the impairment tests, as well as the increase in electricity prices in Europe and wage costs in the various geographies, as well as the new regulations relating to the time slots for furniture lighting in a few European countries.
When the book value of an asset (or group of assets) exceeds its recoverable amount, an impairment loss is recognised in the income statement to write down the asset's book value to the recoverable amount.
The values in use taken into account for impairment testing are determined on the basis of expected future cash flows, discounted at a rate based on the weighted average cost of capital. This rate reflects management's best estimates regarding the time value of money, the risks specific to the assets or CGUs, and the economic situation in the geographical areas where the business relating to these assets or CGUs is carried out.
Countries are broken down into six areas based on the risk associated with each country, and each area corresponds to a specific discount rate ranging from 8.0 % to 15.5 %, for the area presenting the highest risk. The after-tax rate of 8.0 % used in 2022 (7.0% in 2021), was notably used in Western Europe (excluding Spain, Portugal, Italy and Ireland), North America, Japan, Singapore, South Korea and United Arab Emirates. In addition, there is a risk premium on the Airports segment of 100 basis points (200 in 2021), reflecting the specific risk of this activity in the context of the unprecedented global crisis caused by the Covid-19 pandemic and an uncertain recovery horizon.
▪ Recoverable amounts
These are determined based on budgeted values for the first year following the closing of the accounts, and growth and change assumptions specific to each market and reflecting the expected future outlook. Recoverable amounts are based on business plans for which the procedures for determining future cash flows differ for the various business segments; the related time horizon usually exceeds five years owing to the nature and business activity of the Group, characterised by long-term contracts with a strong likelihood of renewal. In general:
In the context of an onerous contract, the provision for onerous contract is assessed by taking into account the unavoidable net costs attached to this contract, i.e., the rent and fees and costs directly incurred, including direct labour and administrative costs. And when there is an exit clause that costs less than the costs of continuing the contract, it is this exit clause that is provisioned.
The recoverable amount of a group of CGUs corresponds to the sum of the individual recoverable amounts of each CGU belonging to that group.
JCDecaux's core business contracts often contain specificities geared to the activity to which they relate (Street furniture, Transport and Billboard) or to their geographic area (local regulation or market practice).
Very often, each contract for Street Furniture and Transport business is a specific case with complex terms arising from direct negotiations or tender-offer conditions. Said terms may also be renegotiated during the life-span of the contract, mostly due to unexpected market events or to the operational deployment of advertising structures.
More than 15,000 contracts identified in over 75 countries fall within the scope of IFRS 16. These are essentially signed with municipalities, airports, transport companies, shopping centres and private landlords. The purpose of these contracts is to secure locations in which to install advertising panels used for the Group's main activity. Among the 15,000 contracts and more that fall within the scope of IFRS 16, almost 80% are advertising space lease agreements (Street furniture, Transport, and Billboard); they represented nearly 93% of lease liabilities as of 31 December 2022. The remaining 20% are real estate and vehicle contracts.
Fixed (or fixed in-substance) rent and fees are quite often minimum guarantees of variable fees based on the advertising revenue generated by advertising panels installed in the locations covered by the contract. This is a predominant feature for transport and shopping centre business, frequently the case for street furniture, but rarer in billboard advertising where rent and fees are not usually linked to generated revenue.
Fixed rent and fees and/or fixed in substance rent and fees or minimum guarantees may, according to the contracts:
Contracts may have widely different non-cancellable periods, ranging from 1 to 39 years in total:
Regarding extension and renewal terms:
Only a small number of contracts has been identified in which JCDecaux has the sole right to exercise an early termination option. More often, either the agreement of both parties is required, or the early termination option is subject to specific conditions (e.g. force majeure, change in direction of road traffic for large format billboards, major economic recession or collapse of the advertising market in certain transport contracts).
As from 1 January 2019, each new contract is analysed to confirm whether or not it meets the definition of a lease. When the contractor who has granted advertising space to the Group has a right of substitution, allowing the contractor to replace any space allocated at the start of the contract with another one over the duration of the contract in order to meet operational needs (except in the case of maintenance and repair activity), this right is considered to be substantive. This is the case for the Group's street furniture and transport business, which contains provisions giving the supplier who has granted advertising space to the Group (the contractor), the right to permanently or temporarily move certain equipment to another location or remove equipment. In the case of bus shelter contracts, the municipality may thus have the right to adapt the locations of bus shelters to changes in bus lines routes. In the case of bus contracts, the transport company may have the right to change the numbers of buses, the roads or the assignment of buses to roads. In the case of airport contracts, the grantor or the airport administration authority may also have the right to request that the advertising structures be moved to adapt it to the airport's operational needs.
These rights may be exercised by the contractor at any time after a specific situation has arisen (for example in the event of restructuring, modification or extension of the airport, closure of roads, optimisation of the bus network, plans for refurbishment, maintenance and repair) or for any reason whatsoever, generally given scant definition in the contracts.
The bases for concluding that such agreements include substantive substitution rights are as follows:
When the substantial character of the substitution right clause is invoked, the Group does not have control over the assets. These contracts therefore do not meet the definition of a lease under IFRS 16 and the fixed rent and fees for the year remain recognised as operating expenses in the same way as variable rent and fees. For these contracts, future fixed rent and fees commitments until the maturity of the contract are disclosed in off-balance sheet commitments for the total amount to which the Group is committed.
Moreover, both exemptions authorised by IFRS 16 – short-term leases (12 months or less) and low value leases – have been applied.
In accordance with IFRS 16 "Leases" applied since 1 January 2019 using the full retrospective transition method, the Group recognises a lease liability for contractual minimum and fixed rental payments (or variable based on an index) against a right-of-use asset which is depreciated on a straight-line basis over the term of the lease or the useful life of the underlying asset.
The fixed rent charge in the operating margin is replaced by the amortisation of the right-of-use recognised in EBIT and the financial expense of the lease liability recorded in financial income and expenses.
Variable rent and fees based on revenue are excluded from the lease liability and are recorded in operating expenses when they occur.
The standard has no impact on net income over the lease term but has a negative impact at the beginning of the contract, which reverses over time due to declining interest expenses.
The Group's net debt excludes lease liabilities.
In the statement of cash flows, only the payment of interest on the lease liability impacts cash flows from operating activities, while the principal portion impacts the cash flows from financing activities.
Net deferred taxes are recognised on leases falling under the scope of IFRS 16; right of use and lease liabilities are analysed together.
The amount of the lease liability depends on the assumptions used for the calculation thereof, such as commitment term and marginal borrowing rate.
The marginal borrowing rate is calculated for each lease as the risk-free rate for the lease's currency plus the currency basis, if available, and the subsidiary's credit margin based on the Group's credit risk or in a few specific cases linked to own financing in the subsidiaries, on a credit risk specific to the subsidiary concerned. These components are defined in light of the average weighted life of the lease.
The contract term is determined by taking into account the non-cancellable period and the periods covered by renewal (or termination) options where it is reasonably certain that these options will be exercised (or not).
With respect to extension or termination options, the Group complies with IFRS 16 and the IFRS IC decision of November 2019 on lease terms and the useful lives of leasehold improvements:
For contracts that have an indefinite term, that are cancellable at any time by either party, or that are tacitly renewed, in accordance with the IFRS IC decisions on lease terms, the useful life of leasehold improvements is used to determine the contract term or, in the context of tacitly renewed contracts, the average term to date of the tacitly renewed contracts.
With regard to French commercial leases, in accordance with the ANC's statement of conclusion dated 3 July 2020 and the illustration issued by the CNCC in November 2020, the term generally applied by the Group is nine years, with a non-cancellable period of three years. There is no renewal option at the end of the lease for major contracts. Said contracts are never tacitly renewed and are always renegotiated.
Changes and re-estimates of contracts mainly relate to signed amendments to contracts and to the life of the contract, in particular a change in the amount of rents to be paid or a change in the reasonably certain end-date when a decision is made regarding the extension or early termination of a contract. Such changes lead to a reestimation of the lease liability against the right-of-use. The impact of this contract modification presents a linearised effect in the income statement on the new residual term of the contract and may lead, in the event of termination of contracts, to a positive effect in the income statement.
Contracts already signed but not started at the closing date are disclosed in off-balance sheet commitments.
The Group may need to negotiate reductions in fixed and minimum guaranteed rents with its concession grantors.
For contracts falling within the scope of IFRS 16, i.e. contracts that do not include substantive substitution rights, the amount of these rent reductions is recognised:
At the date of acquisition, investments under the equity method include the share of the Group's equity (excluding non-controlling interests) as well as the goodwill recognised on the acquisition of these shares.
The share of impairment of the assets recognised at the time of acquisition or upon the fair value adjustment of existing assets is presented under "Share of net profit of companies under the equity method".
If the Group's share of losses of an equity-accounted entity exceeds its interest in that entity, its share is reduced to zero under "Investments under the equity method" by a reclassification against any loan to this entity consisting of a net investment. If the Group considers itself as involved in losses, a provision is recognised under provisions for contingencies for the share of losses exceeding the initial investment as well as loans and receivables.
Investments under the equity method are subject to impairment tests on an annual basis, or when existing conditions suggest a possible impairment. When necessary, the related loss, which is recorded in "Share of net profit of companies under the equity method," is calculated on the asset's recoverable value which is defined as either (i) the fair value of the asset less costs of disposal, or (ii) its value in use based on the expected future cash flows less net debt, whichever is the greater. For listed companies, the fair value used as part of impairment tests corresponds to the stock price. The method used to calculate the values in use is the same one as applied for PP&E, intangible assets and right-of-use as described in Note 1.10 "Impairment of intangible assets, property, plant and equipment, right-of-use and goodwill".
This heading mainly includes investments in non-consolidated entities (financial investments), loans, deposits and guarantees and advances paid on the acquisition of long-term investments under conditions precedent.
They are recorded and measured:
Inventories mainly consist of:
Inventories are valued at weighted average cost, and may include production, assembly and logistic costs. Inventories are written down to their net realisable value when said value is lower than cost.
Trade receivables are recorded at fair value, which corresponds to their nominal invoice value, unless there is a significant discounting effect. After initial recognition, they are measured at amortised cost.
A provision for impairment is recognised when their recovery amount is less than their book value. The Group recognises an additional provision relating to expected losses using the simplified method on the performing receivables by applying an average rate of default of payment based from historical statistical data. This forwardlooking model based on expected losses applies to receivables upon their initial recognition.
The Group can proceed to transfers of receivables as part of recurring or one-off programs. Pursuant to the provisions of IFRS 9, an analysis is then carried out to assess the transfer of the risks and benefits inherent in the ownership of these receivables and in particular that of the credit risk, the risk of late payment and the risk of dilution. If this review confirms the transfer of almost all the risks and benefits associated with the receivables transferred, these are removed from the statement of financial position.
Managed cash includes cash, cash equivalents and treasury financial assets. These items are measured at fair value and changes in fair value are recognised in net financial income.
Cash recognised as assets in the statement of financial position includes cash at bank and cash in hand. Cash equivalents consist of short-term investments and short-term deposits. Short-term investments and short-term deposits are easily convertible into a known cash amount and are subject to low risk of change in value, in accordance with IAS 7.
Treasury financial assets are short-term liquid investments and cash owned by the Group but held in escrow accounts in connection with the execution of contracts. These assets have the main characteristics of cash equivalents but do not strictly comply with all the criteria to be qualified as such, according to IAS 7. They are included in the calculation of the Group's net debt.
For the consolidated statement of cash flows, net cash consists of cash and cash equivalents as defined above, net of bank overdrafts.
Financial debts are initially recorded at the fair value generally corresponding to the amount received less related issuance costs and are subsequently measured at amortised cost.
A financial derivative is a financial instrument having the following three characteristics:
Financial derivatives are recognised in the statement of financial position at fair value in assets or liabilities. Changes in subsequent values are offset in the income statement, unless they have been qualified as part of an effective cash flow hedge (effective portion) or as a foreign net investment.
Hedge accounting may be adopted if a hedging relationship between the hedged item (the underlying) and the financial derivative is established and documented from the time the hedge is set up, and its effectiveness is demonstrated from inception and at each period-end. The Group currently limits itself mainly to two types of hedges for financial assets and liabilities:
The hedging relationship involves a single market parameter, which for the Group is currently either a foreign exchange rate or an interest rate. When a derivative is used to hedge both a foreign exchange and interest rate risk, the foreign exchange and interest rate impacts are treated separately.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies for hedge accounting. Any cumulative gain or loss on a cash flow hedge as part of the hedging of a highly probable forecasted transaction recognised under other comprehensive income is maintained under other comprehensive income until the forecasted transaction occurs. If the hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised under other comprehensive income is transferred to net financial income for the period.
For derivatives that do not qualify for hedge accounting, any gains or losses arising from changes in fair value are recorded directly under net financial income for the period.
The accounting classification of financial derivatives instruments in current or non-current items is determined by the maturity of the derivative.
In the absence of any position from the IASB on the accounting treatment of commitments to purchase noncontrolling interests, the accounting positions taken in the previous consolidated financial statements have been maintained for all Group commitments.
The application of IAS 32 results in the recognition of a liability relating to commitments to purchase shares held by non-controlling interests in the Group's subsidiaries, not only for the portion already recognised in non-controlling interests (reclassified in liabilities), but also for the excess resulting from the present value of the commitment. The amount of this excess portion is deducted from non-controlling interests in the equity of the statement of financial position.
In the absence of any position from the IASB on the accounting treatment of commitments to purchase noncontrolling interests, subsequent changes in the fair value of the liability are recognised under net financial income and allocated to non-controlling interests in the income statement, with no impact on consolidated net income (Group share).
Commitments recorded in this respect are presented under the statement of financial position heading "Debt on commitments to purchase non-controlling interests".
The Group's obligations resulting from defined benefit plans, as well as their cost, are recognised as liabilities and determined using the projected unit credit method.
This method consists in measuring the obligation based on the projected end-of-career salary and the rights vested at the valuation date, determined in accordance with collective trade union agreements, company agreements or the legal rights in effect.
The actuarial assumptions used to determine the obligations vary according to the economic conditions prevailing in the country of origin and the demographic assumptions specific to each company.
These plans are either funded, with their assets being managed by an entity that is legally separate and independent from the Group, or partially funded or not funded, with the Group's obligations being covered by a provision in the statement of financial position. The income from the plan's assets is estimated based on the discount rate used for the benefit obligation.
For the post-employment benefit plans, the actuarial gains and losses are immediately and entirely recognised under other comprehensive income with no option to reclassify in the income statement. Past service costs are immediately and fully recorded in the income statement on acquired rights as well as on future entitlements.
For other long-term benefits, actuarial gains or losses and past service costs are recognised as income or expenses when they occur.
The effects of discounting the provision for employee benefits are presented in net financial income (loss).
Costs for dismantling street furniture at the end of a contract are recorded under provisions, when a contractual dismantling obligation exists at a foreseeable date. These provisions represent the entire estimated dismantling cost from the contract's inception and are discounted. In return, dismantling costs are offset under assets in the statement of financial position and amortised over the term of the contract. The discounting charge is recorded as a financial expense. The discount rate applied is the swap rate in the country concerned for the average weighted life of the assets of the contracts.
In accordance with IFRS 2 "Share-based payment", stock options granted to employees are considered to be part of compensation in exchange for services rendered over the period extending from the grant date to the vesting date.
The fair value of services rendered is determined by reference to the fair value of the financial instruments granted.
The fair value of options is determined at their grant date by an independent actuary, and any subsequent changes in the fair value are not taken into account. The Black & Scholes valuation model used is based on the assumptions described in Note 5.2 "Net operating expenses" hereafter.
The cost of services rendered is recognised in the income statement and offset under an equity heading on a basis that reflects the vesting pattern of the options. This entry is recorded at the end of each accounting period until the date at which all vesting rights of the plan in question have been fully vested.
The amount stated in equity reflects the extent to which the vesting period has expired and the number of options granted that, based on management's best available estimate, will ultimately vest. The vesting period runs from the date of acceptance by the beneficiary.
Stock option plans are granted based on individual objectives and Group results. The exercise of stock options is subject to years of continuous presence in the company.
The fair value of free shares is determined on their date of grant by an independent actuary. This fair value of the free share is determined according to the price on the grant date less discounted future dividends.
Obtaining all the free shares takes place after continuous presence within the Group defined according to the plans and according to the achievement of Group and individual performance conditions.
The cost of services rendered is recognised in the income statement by offsetting an equity item, following a profile that reflects the terms of acquisition of the free shares. The vesting period runs from the date of acceptance by the beneficiary.
The share subscription and purchase plans which will be settled in cash are assessed at their fair value, recorded in the income statement and offset with a liability. This liability is measured at each closing date up to its settlement.
The Group's revenue comes primarily from sales of advertising space on street furniture equipment, billboards and advertising in transport systems.
Advertising space revenue, rentals and provided services are recorded as revenue on a straight-line basis for the period over which the service is performed. The duration of said period is generally between 1 week and 3 years.
The trigger event for advertising space revenue recognition is the execution of the advertising campaign.
Advertising space revenue is recorded on a net basis after deduction of commercial rebates. In some countries, commissions are paid by the Group to advertising agencies and media brokers when they act as intermediaries between the Group and advertisers. These commissions are then deducted from revenue.
In agreements where the Group pays variable fees or revenue sharing, and to the extent that the Group acts as the principal in its advertising space sales activity, the Group recognises all gross advertising revenue as revenue and records fees and the portion of revenue repaid as operating expenses.
Discounts granted to customers for early payment are deducted from revenue.
Provision of advertising space contracts is considered to be one-off long-term service delivery. When discounts are granted to customers on long-term contracts for the provision of advertising space, these are recorded as a cumulative adjustment over the entire duration of the contract, with the service still to be provided not being considered as distinct from the service already performed.
In addition to marketing advertising space on furniture, the Group also sells, rents and maintains street furniture, the revenue from which is recognised under Street Furniture business. The Group also earns non-advertising revenues from its Self-Service Bicycle business as well as the implementation of innovative technical solutions, under the "JCDecaux Innovate" name, plus services ancillary to its analogue and digital revenues. Non-advertising revenue is recognised on a straight-line basis over the duration of the contract, apart from the sale of furniture or one-off services.
The operating margin is defined as revenue minus direct operating and selling, general and administrative expenses.
It includes charges to provisions net of reversals relating to trade receivables.
The operating margin is impacted by cash discounts granted to customers deducted from revenue, and cash discounts received from suppliers deducted from direct operating expenses. It also includes stock option or free share expenses recognised in the line item "Selling, general and administrative expenses".
EBIT is determined on the basis of the operating margin minus the consumption of spare parts used for maintenance, depreciation, amortisation and provisions (net), goodwill impairment losses, and other operating income and expenses. Inventory impairment losses are recognised in the line item "Maintenance spare parts".
Other operating income and expenses include the gains and losses generated by the disposal of property, plant and equipment, intangible assets, joint ventures and associates, gains and losses on leases, gains and losses generated by the loss of control of companies, any gain or loss resulting from the fair value revaluation of a retained interest, any gain or loss resulting from the fair value revaluation of a previously held equity interest at the time control is acquired with staged acquisitions, potential price adjustments resulting from events subsequent to the acquisition date, as well as any negative goodwill, acquisition-related costs, and non-recurring items.
Net charges related to the results of impairment tests performed on property, plant and equipment, intangible assets and right-of-use are included in the line item "Depreciation, amortisation and provisions (net)".
Deferred taxes are recognised based on timing differences between the accounting value and the tax base of assets and liabilities. They mainly stem from consolidation restatements (standardisation of Group accounting principles and amortisation/depreciation periods for property, plant and equipment and intangible assets, leases, recognition of contracts as part of the purchase method, etc.). Deferred tax assets and liabilities are measured at the tax rate expected to apply for the period in which the asset is realised or the liability is settled, based on the tax regulations that were adopted at the closing date. They may be written down if a subsidiary has a net deferred tax asset whose short-term recovery is uncertain.
Deferred tax assets on tax losses carried forward are recognised only when it is probable that the Group will have future taxable profits against which these tax losses may be offset. The period for recovering ordinary losses used by the Group is a 3-to-5-year time frame adapted to the specific characteristics of each country.
In accordance with IFRS, the Group determined that the CVAE (French tax known as the Cotisation sur la Valeur Ajoutée des Entreprises) is an income tax expense.
The main changes in the consolidation scope during 2022 are as follows:
On 5 July 2022, JCDecaux Europe Holding acquired 75% of the company Displayce, company specialising in the purchase and optimisation of digital outdoor advertising campaigns. The newly-acquired company is fully consolidated.
On 15 September 2022, JCDecaux North America acquired 51% of the company JCDecaux Chicago Communication Network, LLC (previously Interstate JCDecaux LLC). This company was previously consolidated under the equity method at 49% and is now fully consolidated.
On 7 December 2022, JCDecaux France acquired 100% of the company Pisoni. Located in the south of France this company is a specialist in street furniture and billboards. The newly-acquired company is fully consolidated.
On June 2022, JCDecaux Middle East FZ LLC acquired 5.4% of the non-controlling interests in the company JCDecaux Dicon FZCO in United Arab Emirates. This company, which was already fully consolidated, is now 80.4% owned.
Other changes, in particular liquidations and acquisitions of investments, are described in Note 13 "Scope of consolidation".
The main acquisitions made in 2022 giving control of the companies JCDecaux Chicago Communication Network, LLC (previously Interstate JCDecaux LLC), Displayce et Pisoni, had the following impacts on the Group's consolidated financial statements:
| Fair value at the date of | ||
|---|---|---|
| In million euros | acquisition | |
| Non-current assets | 54.2 | |
| Current assets | 30.1 | |
| Total assets | 84.3 | |
| Non-current liabilities | 76.8 | |
| Current liabilities | 13.1 | |
| Total liabilities | 89.9 | |
| Fair value of net assets at 100% | (a) | (5.6) |
| - of which non-controlling interests | (b) | 0.2 |
| Total consideration transferred | (c) | 136.0 |
| - of which fair value of share previously held | 47.2 | |
| - of which purchase price | 88.8 | |
| Goodwill | (d)=(c)-(a)+(b) | 141.8 |
| - including Goodwill allocated to companies under the equity method | (e) | 0.0 |
| Goodwill IFRS (1) | (f)=(d)-(e) | 141.8 |
| Purchase price | (88.8) | |
| Net cash acquired | 12.6 | |
| Acquisitions of long-term investments over the period | (76.3) |
(1) The option of the full goodwill calculation method was not used.
The value of assets and liabilities acquired and goodwill relating to these acquisitions is determined on a temporary basis and is likely to change during the period required to finalise the allocation of the goodwill, which can be extended to a maximum of 12 months following the acquisition date.
The impact of these 2022 acquisitions on revenue and net income (Group share) is respectively €5.8 million and €(0.2) million. Moreover net income in 2022 is also impacted by €63.4 million of the fair value revaluation gain of JCDecaux Chicago Communication Network, LLC (previously Interstate JCDecaux LLC) before acquisition of control. Had the acquisitions taken place as of 1 January 2022, the additional impact would have been an increase of €27.1 million on revenue and an increase of €0.1 million on net income (Group share).
To measure the Group's operational performance and to inform managers about their decision-making in line with historical data, segment information is adjusted by:
These two adjustments comply with the principles followed in the Group's operating management reporting used by the Executive Board – the Chief Operating Decision Maker (CODM).
Consequently, pursuant to IFRS 8, the operating data presented hereafter, in line with internal communication, is "adjusted". The "adjusted" data is reconciled with the IFRS financial statements for which the IFRS 11 leads to consolidation of the joint ventures under the equity method and where "core business" rents are accounted for in accordance with IFRS 16 (recognition of a lease liability and a right-of-use asset in respect of the fixed rent and fees and guaranteed minimums) and their impact on the income statement (right-of-use amortisation and discounting of the lease liability) replace the rent charge.
Definition of operating segments
The Street Furniture operating segment covers, in general, the advertising agreements relating to public property entered into with cities and local authorities. It also includes advertising in shopping malls, as well as the renting of street furniture, the sale and rental of equipment (automatic public toilets, bikes, etc…), cleaning and maintenance and various other services.
The Transport operating segment covers advertising in public transport systems, such as airports, metros, buses, trams and trains.
The Billboard operating segment covers, in general, advertising on private property, including either traditional large format or back-light billboards, neon-light billboards and advertising wall wraps.
Transfer prices between operating segments are equal to prices determined on an arm's length basis, as in transactions with third parties.
The development over the last two financial years of the adjusted revenue by activity can be broken down as follows (in percentage):
| In million euros | Street Furniture |
Transport | Billboard | Total |
|---|---|---|---|---|
| Revenue (1) | 1,747.0 | 1,075.2 | 494.3 | 3,316.5 |
| Operating margin | 417.7 | 118.3 | 67.0 | 602.9 |
| EBIT (2) | 128.5 | 19.8 | 44.7 | 193.0 |
| Acquisitions of intangible assets and PP&E net of disposals (3) |
197.4 | 117.4 | 35.0 | 349.9 |
(1) Including advertising revenue for €2,972.5 million and non-advertising revenue for €344.0 million.
(2) Including a net impairment charge related to impairment tests for €(19.1) million: €(3.3) million in Street Furniture, €(15.7) million in Transport and €(0.1) million in Billboard.
(3) Cash payments on acquisitions of intangible assets and property, plant and equipment net of cash receipts on proceeds on disposals of intangible assets and property, plant and equipment.
| In million euros | Adjusted data (1) |
Joint ventures' impact (2) |
IFRS 16 impact (3) |
IFRS data |
|---|---|---|---|---|
| Revenue | 3,316.5 | (242.5) | 0.0 | 3,074.0 |
| Operating margin | 602.9 | (60.6) | 780.2 | 1,322.5 |
| EBIT | 193.0 | (43.6) | 114.1 | 263.4 |
| Acquisitions of intangible assets and PP&E net of | ||||
| disposals | 349.9 | (8.1) | 0.0 | 341.8 |
(1) Including the impact of IFRS 16 on non-core business contracts (of which €56.2 million for the cancellation of rents and €(52.0) million for rightof-use amortisation).
(2) Impact of change from proportionate consolidation to the equity method of joint ventures.
(3) Impact of IFRS 16 on core business rents of controlled companies.
The impact of €(242.5) million resulting from IFRS 11 (change from proportionate consolidation to the equity method for joint ventures) on the adjusted revenue is split between €(259.3) million of revenue from the joint ventures – see Note 11 "Information on the joint ventures" – and €16.7 million for the non-eliminated part of inter-company revenue from Group fully consolidated companies with joint ventures, under IFRS 11, bringing the IFRS revenue to €3,074.0 million.
The impact of €780.2 million resulting from IFRS 16 on the operating margin corresponds to the cancellation of core business rent and fees of controlled companies. The impact of €114.1 million resulting from IFRS 16 on the EBIT breaks down into €780.2 million of cancellation of rent and fees on the operating margin, €(692.9) million of the right-of-use amortisation, €8.1 million of net gain on changes in contracts, €17.4 million IFRS 16 impact from the revaluation of the share previously held in JCDecaux Chicago Communication Network, LLC (formerly Interstate JCDecaux LLC), €(3.1) million of cancellation of reversals of provisions for onerous contracts and €4.4 million of the right-of-use amortisation resulting from the re-qualification of provisions for onerous contracts.
The breakdown of the 2021 segment reporting by operating segment is as follows:
| In million euros | Street Furniture |
Transport | Billboard | Total |
|---|---|---|---|---|
| Revenue (1) | 1,440.1 | 877.8 | 426.7 | 2,744.6 |
| Operating margin | 323.4 | 58.2 | 40.7 | 422.3 |
| EBIT (2) | 42.8 | (17.4) | (16.8) | 8.7 |
| Acquisitions of intangible assets and PP&E net | ||||
| of disposals (3) | 128.0 | 16.5 | 13.0 | 157.5 |
(1) Including advertising revenue for €2,419.8 million and non-advertising revenue for €324.8 million.
(2) Including a net impairment charge related to impairment tests for €(7.6) million: €(7.2) million in Street Furniture and €(0.4) million in Transport. (3) Cash payments on acquisitions of intangible assets and property, plant and equipment net of cash receipts on proceeds on disposals of intangible assets and property, plant and equipment.
The reconciliation of this operating data from Adjusted to IFRS breaks down as follows:
| In million euros | Adjusted data (1) |
Joint ventures' impact (2) |
IFRS 16 impact (3) |
IFRS data |
|---|---|---|---|---|
| Revenue | 2,744.6 | (222.1) | 0.0 | 2,522.5 |
| Operating margin | 422.3 | (58.9) | 800.5 | 1,163.9 |
| EBIT | 8.7 | (39.5) | 99.5 | 68.6 |
| Acquisitions of intangible assets and PP&E net of disposals |
157.5 | (7.2) | 0.0 | 150.3 |
(1) Including the impact of IFRS 16 on non-core business contracts (of which €52.6 million for the cancellation of rents and €(46.5) million for rightof-use amortisation).
(2) Impact of change from proportionate consolidation to the equity method of joint ventures.
(3) Impact of IFRS 16 on core business rents of controlled companies.
The impact of €(222.1) million resulting from IFRS 11 (change from proportionate consolidation to the equity method for joint ventures) on the adjusted revenue is split between €(233.3) million of revenue from the joint ventures – see Note 11 "Information on the joint ventures" – and €11.2 million for the non-eliminated part of inter-company revenue from Group fully consolidated companies with joint ventures, under IFRS 11, bringing the IFRS revenue to €2,522.5 million.
The impact of €800.5 million resulting from IFRS 16 on the operating margin corresponds to the cancellation of core business rent and fees of controlled companies. The impact of €99.5 million resulting from IFRS 16 on the EBIT breaks down into €800.5 million of cancellation of rent and fees on the operating margin, €(725.5) million of the right-of-use amortisation, €23.6 million of net gain on changes in contracts, €(9.1) million of cancellation of reversals of provisions for onerous contracts and €9.8 million of the right-of-use amortisation resulting from the re-qualification of provisions for onerous contracts.
The change in adjusted revenue by geographical area over the last two years is as follows (in percentage):
The 2022 information by geographical area break down as follows:
| In million euros | Europe (1) | Asia Pacific (2) |
France | Rest of the world |
United Kingdom |
North America (3) |
Total |
|---|---|---|---|---|---|---|---|
| Revenue | 988.3 | 721.5 | 598.0 | 416.8 | 322.5 | 269.3 | 3,316.5 |
(1) Excluding France and the United Kingdom. Mainly Germany, Austria, Spain and Belgium.
(2) Mainly China and Australia.
(3) Mainly the United States.
No single customer reaches the 10% of the Group revenue threshold.
The 2021 information by geographical area break down as follows:
| In million euros | Europe (1) | Asia Pacific (2) |
France | Rest of the world |
United Kingdom |
North America (3) |
Total |
|---|---|---|---|---|---|---|---|
| Revenue | 824.5 | 695.9 | 532.6 | 274.9 | 253.2 | 163.4 | 2,744.6 |
(1) Excluding France and the United Kingdom. Mainly Germany, Austria, Spain and Belgium.
(2) Mainly China and Australia.
(3) Mainly the United States.
No single customer reaches the 10% of the Group revenue threshold.
The non-current segment assets by geographical area for the year 2022 (based on IFRS data) break down as follows:
| Europe (1) | Asia | France Rest of the | United | North | Eliminations | Total | ||
|---|---|---|---|---|---|---|---|---|
| In million euros | Pacific | world | Kingdom | America | Intercos | |||
| Non-current segment assets(2) | 2,115.4 | 792.4 | 4,460.1 | 383.4 | 648.7 | 61.1 | (1,669.0) | 6,792.0 |
| Unallocated segment assets(3) | 123.5 |
(1) Excluding France and the United Kingdom.
(2) Excluding deferred tax assets and financial derivatives.
(3) Goodwill relating to Airports World that is not allocated by geographical area, as global coverage is a key success factor for this business activity from a commercial standpoint and in connection with the awarding and renewal of contracts. This also applies to impairment tests.
The non-current segment assets by geographical area for the year 2021 (based on IFRS data) break down as follows:
| In million euros | Europe (1) | Asia Pacific |
France | Rest of the world |
United Kingdom |
North America |
Eliminations Intercos |
Total |
|---|---|---|---|---|---|---|---|---|
| Non-current segment assets(2) | 2,060.1 | 857.8 | 4,501.1 | 381.9 | 662.8 | (29.7) | (1,671.6) | 6,762.3 |
| Unallocated segment assets(3) | 123.9 |
(1) Excluding France and the United Kingdom.
(2) Excluding deferred tax assets and financial derivatives.
(3) Goodwill relating to Airports World that is not allocated by geographical area, as global coverage is a key success factor for this business activity from a commercial standpoint and in connection with the awarding and renewal of contracts. This also applies to impairment tests.
The reconciliation of the free cash flow from Adjusted to IFRS for the year 2022 is as follows:
| In million euros | Adjusted data |
Joint ventures' impact (1) |
IFRS 16 impact (2) |
IFRS data |
|---|---|---|---|---|
| Operating Cash Flow s (3) | 399.4 | (10.6) | 703.7 | 1,092.6 |
| Change in w orking capital | (6.4) | 14.6 | (1.2) | 7.0 |
| Net cash provided by operating activities | 393.0 | 4.0 | 702.5 | 1,099.6 |
| Acquisitions of intangible assets and PP&E net of disposals (4) |
(349.9) | 8.1 | (341.8) | |
| Free Cash Flow | 43.2 | 12.1 | 702.5 | 757.8 |
(1) Impact of change from proportionate consolidation to the equity method of joint ventures.
(2) IFRS 16 impact on core and non-core business rents of controlled companies.
(3) Net cash provided by operating activities excluding change in working capital.
(4) Cash payments on acquisitions of intangible assets and property, plant and equipment net of cash receipts on proceeds on disposals of intangible assets and property, plant and equipment.
The reconciliation of the free cash flow from Adjusted to IFRS for the year 2021 is as follows:
| Adjusted data |
Joint ventures' |
IFRS 16 impact (2) |
IFRS data |
|
|---|---|---|---|---|
| In million euros | impact (1) | |||
| Operating Cash Flow s (3) | 237.6 | (16.7) | 615.3 | 836.1 |
| Change in w orking capital | 131.4 | 1.7 | 32.6 | 165.7 |
| Net cash provided by operating activities | 369.0 | (15.0) | 647.8 | 1,001.8 |
| Acquisitions of intangible assets and PP&E net of disposals (4) |
(157.5) | 7.2 | (150.3) | |
| Free Cash Flow | 211.5 | (7.8) | 647.8 | 851.5 |
(1) Impact of change from proportionate consolidation to the equity method of joint ventures.
(2) IFRS 16 impact on core and non-core business rents of controlled companies.
(3) Net cash provided by operating activities excluding change in working capital.
(4) Cash payments on acquisitions of intangible assets and property, plant and equipment net of cash receipts on proceeds on disposals of intangible assets and property, plant and equipment.
2022 and 2021 changes in net book value:
| In million euros | 2022 | 2021 |
|---|---|---|
| Net value as of 1 January | 1,609.3 | 1,592.8 |
| Impairment loss | ||
| Decreases | 0.0 | |
| Changes in scope (1) | 141.8 | (11.6) |
| Translation adjustments | (2.4) | 28.1 |
| Net value as of 31 December | 1,748.7 | 1,609.3 |
(1) The changes in scope in 2022 mainly concern the provisional goodwill recognised following the takeover of the companies JCDecaux Chicago Communication Network, LLC (previously Interstate JCDecaux LLC), Displayce et Pisoni.
2022 changes in gross value and net book value:
| Patents, | Leasehold | ||
|---|---|---|---|
| costs | contracts, ERP (1) | account, other | Total |
| 110.9 | 1,192.8 | 44.3 | 1,348.1 |
| 10.6 | 167.8 | 16.8 | 195.2 |
| (0.8) | (10.9) | (0.0) | (11.7) |
| 0.9 | 0.0 | 1.1 | 2.0 |
| 0.2 | (2.1) | 1.5 | (0.5) |
| (0.5) | 16.9 | (27.9) | (11.5) |
| 121.3 | 1,364.5 | 35.8 | 1,521.6 |
| (69.7) | (738.6) | (25.4) | (833.7) |
| (9.7) | (74.2) | (0.1) | (84.0) |
| 0.0 | |||
| 0.7 | 10.9 | 0.0 | 11.6 |
| 0.0 | |||
| 0.1 | 1.0 | (1.0) | 0.0 |
| 0.4 | (0.9) | 8.9 | 8.5 |
| (78.1) | (801.9) | (17.6) | (897.6) |
| 41.2 | 454.2 | 18.9 | 514.4 |
| 43.1 | 562.7 | 18.1 | 624.0 |
| Development | licences, advertising |
rights, payments on |
(1) Includes the valuation of contracts recognised in connection with business combinations.
(2) The net impact of reclassifications is not nil, as some reclassifications have an impact on other items in the statement of financial position.
2021 changes in gross value and net book value:
| Development | Patents, licences, advertising |
Leasehold rights, payments |
||
|---|---|---|---|---|
| In million euros | costs | contracts, ERP (1) | on account, other | Total |
| Gross value as of 1 January 2021 | 104.2 | 1,124.7 | 44.3 | 1,273.2 |
| Acquisitions/Increases | 8.6 | 17.0 | 14.5 | 40.1 |
| Decreases | (2.4) | (6.4) | (9.4) | (18.2) |
| Changes in scope | 0.1 | (0.1) | 0.0 | |
| Translation adjustments | 0.3 | 33.7 | 1.4 | 35.4 |
| Reclassifications (2) | 0.3 | 8.2 | (6.6) | 1.9 |
| Goodwill allocation | (0.1) | 15.7 | 15.7 | |
| Gross value as of 31 December 2021 | 110.9 | 1,192.8 | 44.3 | 1,348.1 |
| Amortisation / Impairment as of 1 January 2021 | (61.8) | (645.4) | (31.9) | (739.1) |
| Amortisation charge | (10.3) | (76.4) | (0.7) | (87.3) |
| Impairment loss | 0.0 | |||
| Decreases | 2.4 | 4.8 | 9.4 | 16.6 |
| Changes in scope | (0.1) | 0.1 | 0.0 | |
| Translation adjustments | (0.0) | (21.5) | (1.1) | (22.6) |
| Reclassifications (2) | (0.1) | (1.1) | (1.1) | |
| Goodwill allocation | 0.1 | (0.1) | 0.0 | |
| Amortisation / Impairment as of 31 December 2021 | (69.7) | (738.6) | (25.4) | (833.7) |
| Net value as of 1 January 2021 | 42.4 | 479.2 | 12.4 | 534.1 |
| Net value as of 31 December 2021 | 41.2 | 454.2 | 18.9 | 514.4 |
(1) Includes the valuation of contracts recognised in connection with business combinations, in particular regarding the acquisition of Abri Services at the end of 2020, the allocation of which was finalised in 2021.
(2) The net impact of reclassifications is not nil, as some reclassifications have an impact on other items in the statement of financial position.
| 31/12/2021 | ||||
|---|---|---|---|---|
| In million euros | Gross value | Net value | ||
| Land | 14.4 | (0.5) | 14.0 | 15.3 |
| Buildings | 93.1 | (74.7) | 18.4 | 19.2 |
| Technical installations, tools and equipment | 3,419.0 | (2,359.9) | 1,059.1 | 1,033.7 |
| Vehicles | 86.1 | (47.7) | 38.4 | 41.3 |
| Other property, plant and equipment | 177.9 | (141.6) | 36.3 | 35.0 |
| Assets under construction and down payments | 117.2 | (4.3) | 112.9 | 59.3 |
| Total | 3,907.8 | (2,628.8) | 1,279.0 | 1,203.9 |
2022 changes in gross value and net book value:
| Technical | |||||
|---|---|---|---|---|---|
| installations, tools | |||||
| In million euros | Land | Buildings | & equipment | Other | Total |
| Gross value as of 1 January 2022 | 16.6 | 93.1 | 3,314.9 | 323.4 | 3,748.0 |
| - of which dismantling cost | 242.3 | 242.3 | |||
| Acquisitions | 1.9 | 137.8 | 155.1 | 294.8 | |
| - of which dismantling cost | 118.0 | 118.0 | |||
| - of which effect of rate change on dismantling cost | (37.7) | (37.7) | |||
| - of which neutralisation of capital + / - on disposals to | |||||
| companies accounted for by the equity method | (3.3) | (3.3) | |||
| Decreases | (1.8) | (3.7) | (179.4) | (10.7) | (195.5) |
| - of which dismantling cost | (20.8) | (20.8) | |||
| Changes in scope | 33.5 | 3.6 | 37.1 | ||
| Reclassifications (1) | 0.9 | 113.1 | (90.9) | 23.1 | |
| Goodwill allocation | 0.0 | ||||
| Translation adjustments | (0.4) | 0.9 | (1.0) | 0.8 | 0.3 |
| Gross value as of 31 December 2022 | 14.4 | 93.1 | 3,419.0 | 381.3 | 3,907.8 |
| Amortisation / Impairment as of 1 January 2022 | (1.2) | (73.9) | (2,281.2) | (187.7) | (2,544.1) |
| - of which dismantling cost | (140.5) | (140.5) | |||
| Depreciation charge net of reversals | (0.0) | (3.3) | (227.9) | (15.0) | (246.1) |
| - of which dismantling cost | 0.0 | ||||
| Impairment loss | (0.2) | (0.2) | |||
| Decreases | 0.8 | 3.0 | 175.7 | 9.2 | 188.7 |
| - of which dismantling cost | 19.4 | 19.4 | |||
| Changes in scope | 0.0 | 0.0 | 0.0 | ||
| Reclassifications (1) | (0.1) | (22.9) | 0.2 | (22.8) | |
| Goodwill allocation | 0.0 | ||||
| Translation adjustments | 0.0 | (0.5) | (3.5) | (0.4) | (4.3) |
| Amortisation / Impairment as of 31 December 2022 | (0.5) | (74.7) | (2,359.9) | (193.7) | (2,628.8) |
| Net value as of 1 January 2022 | 15.3 | 19.2 | 1,033.7 | 135.7 | 1,203.9 |
| Net value as of 31 December 2022 | 14.0 | 18.4 | 1,059.1 | 187.6 | 1,279.0 |
(1) The net impact of reclassifications is not nil, as some reclassifications have an impact on other items in the statement of financial position.
2021 changes in gross value and net book value:
| Technical | |||||
|---|---|---|---|---|---|
| In million euros | Land | Buildings | installations, tools & equipment |
Other | Total |
| Gross v alue as of 1 January 2021 |
17.5 | 99.5 | 3,163.3 | 347.9 | 3,628.2 |
| - of which dismantling cost | 196.4 | 196.4 | |||
| Acquisitions | 0.0 | 0.3 | 93.9 | 88.8 | 182.9 |
| - of which dismantling cost | 59.6 | 59.6 | |||
| - of which effect of rate change on dismantling cost | (5.7) | (5.7) | |||
| Decreases | (1.7) | (7.3) | (110.7) | (10.8) | (130.5) |
| - of which dismantling cost | (13.3) | (13.3) | |||
| Changes in scope | 0.0 | (1.1) | (0.1) | (1.2) | |
| Reclassifications (1) | 0.0 | 0.2 | 113.5 | (108.2) | 5.5 |
| Goodwill allocation | (0.5) | 0.0 | (0.5) | ||
| Translation adjustments | 0.7 | 0.5 | 56.5 | 5.8 | 63.5 |
| Gross v alue as of 31 December 2021 |
16.6 | 93.1 | 3,314.9 | 323.4 | 3,748.0 |
| Amortisation / Impairment as of 1 January 2021 | (1.2) | (68.6) | (2,118.5) | (178.6) | (2,366.9) |
| - of which dismantling cost | (121.7) | (121.7) | |||
| Depreciation charge net of reversals | 0.0 | (3.2) | (217.7) | (15.3) | (236.3) |
| - of which dismantling cost | (28.1) | (28.1) | |||
| Impairment loss | 0.0 | 0.0 | (8.0) | 0.0 | (8.0) |
| Decreases | 0.0 | 3.6 | 107.4 | 9.3 | 120.3 |
| - of which dismantling cost | 12.2 | 12.2 | |||
| Changes in scope | 0.0 | 0.9 | 0.2 | 1.1 | |
| Reclassifications (1) | (5.4) | (2.9) | (0.4) | (8.7) | |
| Goodwill allocation | 0.0 | 0.0 | 0.0 | 0.0 | |
| Translation adjustments | 0.0 | (0.4) | (42.3) | (2.7) | (45.4) |
| Amortisation / Impairment as of 31 December 2021 | (1.2) | (73.9) | (2,281.2) | (187.7) | (2,544.1) |
| Net v alue as of 1 January 2021 |
16.3 | 30.9 | 1,044.8 | 169.3 | 1,261.3 |
| Net v alue as of 31 December 2021 |
15.3 | 19.2 | 1,033.7 | 135.7 | 1,203.9 |
(1) The net impact of reclassifications is not nil, as some reclassifications have an impact on other items in the statement of financial position.
| 31/12/2021 | ||||
|---|---|---|---|---|
| In million euros | Gross value | Depreciation or provision |
Net value | Net value |
| Right-of-Use leased advertising space | 6,765.3 | (4,236.2) | 2,529.1 | 2,755.8 |
| Right-of-Use leased property | 368.0 | (206.8) | 161.2 | 179.9 |
| Right-of-Use leased vehicles | 90.5 | (58.1) | 32.4 | 26.6 |
| Right-of-Use other leases | 6.1 | (3.5) | 2.6 | 2.5 |
| Total | 7,229.9 | (4,504.6) | 2,725.3 | 2,964.8 |
2022 changes in gross value and net book value:
| Right-of-use leased advertising |
Right-of-use leased |
Right-of-use leased |
Right-of-use | ||
|---|---|---|---|---|---|
| In million euros | space | property | vehicles | other leases | Total |
| Gross value as of 1 January 2022 | 6,947.0 | 363.6 | 81.1 | 4.8 | 7,396.5 |
| Increases | 471.7 | 26.9 | 19.2 | 1.1 | 518.9 |
| Change in scope | 102.2 | 0.0 | 0.0 | 0.0 | 102.2 |
| Decreases (1) | (825.2) | (24.8) | (9.7) | 0.0 | (859.6) |
| Translation adjustments | 69.5 | 2.2 | 0.0 | 0.2 | 72.0 |
| Gross value as of 31 December 2022 | 6,765.3 | 368.0 | 90.5 | 6.1 | 7,229.9 |
| Amortisation / Impairment as of 1 January 2022 | (4,191.2) | (183.7) | (54.5) | (2.3) | (4,431.7) |
| Depreciation charge net of reversals (2) | (688.5) | (38.5) | (13.2) | (1.0) | (741.3) |
| Decreases | 691.0 | 16.7 | 9.7 | 0.0 | 717.4 |
| Changes in scope | 0.0 | ||||
| Translation adjustments | (47.4) | (1.3) | (0.1) | (0.2) | (49.0) |
| Amortisation / Impairment as of 31 December 2022 |
(4,236.2) | (206.8) | (58.1) | (3.5) | (4,504.6) |
| Net value as of 1 January 2022 | 2,755.8 | 179.9 | 26.6 | 2.5 | 2,964.8 |
| Net value as of 31 December 2022 | 2,529.1 | 161.2 | 32.4 | 2.6 | 2,725.3 |
(1) Includes the reduction of Right-of-use linked to reliefs treated as contract modifications because they do not fall within the scope of the IFRS 16 expedient (see Note 1.11.4 "IFRS 16 Rent concessions").
(2) Including €(4.0) million of right-of-use amortisation relating to impairment tests.
| Right-of-use leased |
|||||
|---|---|---|---|---|---|
| In million euros | advertising space |
Right-of-use leased property |
Right-of-use leased vehicles |
Right-of-use other leases |
Total |
| Gross value as of 1 January 2021 | 7,049.8 | 335.1 | 75.4 | 3.4 | 7,463.7 |
| Increases | 527.3 | 36.8 | 8.4 | 1.3 | 573.7 |
| Equity impact (IFRS16 amendment) (1) | 5.8 | 5.8 | |||
| Change in scope | 0.3 | 1.3 | 1.6 | ||
| Decreases (2) | (953.1) | (18.5) | (4.6) | 0.0 | (976.2) |
| Translation adjustments | 317.3 | 9.9 | 0.6 | 0.1 | 327.9 |
| Gross value as of 31 December 2021 | 6,947.0 | 363.6 | 81.1 | 4.8 | 7,396.5 |
| Amortisation / Impairment as of 1 January 2021 | (3,854.7) | (144.3) | (46.6) | (1.5) | (4,047.2) |
| Depreciation charge net of reversals (3) | (715.7) | (36.2) | (10.7) | (0.8) | (763.3) |
| Equity impact (IFRS16 amendment) (1) | (1.1) | (1.1) | |||
| Decreases | 579.2 | 2.1 | 3.4 | 0.0 | 584.8 |
| Changes in scope | 0.0 | ||||
| Translation adjustments | (199.0) | (5.4) | (0.5) | (0.1) | (204.9) |
| Amortisation / Impairment as of 31 December 2021 | (4,191.2) | (183.7) | (54.5) | (2.3) | (4,431.7) |
| Net value as of 1 January 2021 | 3,195.1 | 190.8 | 28.8 | 1.9 | 3,416.5 |
| Net value as of 31 December 2021 | 2,755.8 | 179.9 | 26.6 | 2.5 | 2,964.8 |
(1) See Note 1.11.4 "IFRS 16 Rent concessions". The equity impact after tax totalling €3.2 million.
(2) Includes the reduction of Right-of-use linked to reliefs treated as contract modifications because they do not fall within the scope of the IFRS 16 expedient (see Note 1.11.4 "IFRS 16 Rent concessions").
(3) Including €2.4 million of net reversals of right-of-use amortization relating to impairment tests.
Goodwill, property, plant and equipment, intangible assets and right-of-use refer to the following CGU groups:
| 31/12/2022 | 31/12/2021 | ||||||
|---|---|---|---|---|---|---|---|
| Goodwill (1) | PP&E / intangible assets / |
Total | Goodwill (1) | PP&E / intangible assets / |
Total | ||
| In million euros | Right-of-use (2) |
Right-of-use (2) |
|||||
| Street Furniture Europe (excluding France and United | |||||||
| Kingdom) | 387.1 | 282.8 | 669.9 | 390.0 | 230.9 | 620.9 | |
| France Roadside | 243.0 | 381.0 | 624.1 | 210.9 | 362.4 | 573.3 | |
| Pacific | 243.7 | 309.1 | 552.8 | 237.5 | 323.3 | 560.8 | |
| Billboard Europe (excluding France and United | |||||||
| Kingdom) | 155.2 | 27.6 | 182.8 | 154.9 | 27.4 | 182.3 | |
| Billboard United Kingdom | 143.5 | 26.3 | 169.7 | 151.2 | 32.7 | 183.8 | |
| Billboard North America | 105.0 | 25.4 | 130.4 | - | - | - | |
| Billboard Rest of the World | 22.7 | 91.2 | 113.9 | 18.1 | 85.8 | 103.9 | |
| Street Furniture United Kingdom | 57.3 | 21.7 | 78.9 | 58.0 | 15.5 | 73.4 | |
| Airports World (excluding Pacific) | 123.5 | (62.3) | 61.2 | 123.9 | (88.6) | 35.3 | |
| Other | 182.0 | 76.5 | 258.6 | 176.3 | 16.5 | 192.9 | |
| Total | 1,663.1 | 1,179.2 | 2,842.3 | 1,520.8 | 1,005.9 | 2,526.7 |
This table takes into account the impairment losses recognised on property, plant and equipment, intangible assets, right-of-use and goodwill.
(1) Goodwill is shown net of net deferred tax liabilities related to contracts and provisions for onerous contracts deducted from right-of-use recognised in connection with business combinations, totalling, respectively, €85.6 million and €88.5 million as at 31 December 2022 and 31 December 2021.
(2) Intangible assets, property, plant and equipment and right-of-use are presented net of provisions for onerous contracts of €37.1 million and €21.4 million as at 31 December 2022 and 31 December 2021, respectively. They are also shown net of lease liabilities of €3,412.1 million and €3,655.8 million as at 31 December 2022 and 31 December 2021, respectively.
Impairment tests carried out at 31 December 2022 led to the recognition in EBIT of a net depreciation of provision for onerous contracts of €(13.5) million, a net amortisation of right-of-use of €(4.0) million and an overall impairment charge of €(0.2) million on intangible assets and property, plant and equipment. There is no impairment loss on goodwill recognised.
Impairment tests on goodwill, property, plant and equipment, intangible assets and right-of-use have a negative impact of €(18.3) million on the net result (Group share) (compared to €(5.9) million in 2021).
The discount rate, the operating margin ratio and the perpetual growth rate for the Billboard business are considered to be the Group's key assumptions with respect to impairment testing.
The countries are broken down into six areas based on the risk associated with each country, and each area corresponds to a specific discount rate ranging from 8.0% to 15.5% for the area presenting the highest risk. The after-tax rate of 8.0%, employed in 2022 (7.0% in 2021), was used, in particular, in Western Europe (excluding Spain, Portugal, Italy and Ireland), North America, Japan, Singapore, South Korea, United Arab Emirates where the Group generates 62.0% of its adjusted revenue. In addition, there is a risk premium of 100 basis points on the Airports CGU, reflecting the specific risk of this activity in the context of the unprecedented global crisis caused by the Covid-19 pandemic and an uncertain recovery horizon.
The average discount rate for the Group stood at 9.2% in 2022.
The sensitivity tests whose results are presented below were run at the level of each business plan and each CGU. Where a region has several CGUs, tests were run separately on each one.
o and finally, by reducing by 100 basis points the perpetual growth rate of discounted cash flows for the Billboard business, Pacific CGU and France Roadside CGU.
In the Rest of the World region, where some countries are exposed to greater political and economic volatility, three sensitivity tests were also carried out:
The Airports CGU is tested at a global level.
The results below are an aggregate of the tests run on each business plan.
The results of the sensitivity tests demonstrate that:
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Joint ventures | 179.1 | 175.6 |
| Associates | 232.8 | 238.8 |
| Total (1) | 411.9 | 414.4 |
(1) Including €16.3 million related to the Rest of the World area as of 31 December 2022 compared to €14.7 million as of 31 December 2021.
The information related to the joint ventures and associates is provided in application of IFRS 12 "Disclosure of Interests in Other Entities" and is detailed in Note 11 "Information on the joint ventures" and in Note 12 "Information on associates".
In 2022, an impairment loss was recognised on the associates in the amount of €(28.0) million and on the joint ventures in the amount of €(1.4) million.
As the Group's share of the equity-accounted associate's losses is greater than its interest in the associate, the impairment charge of 2022 is shown in the balance sheet as a deduction from the line "Other financial assets" (see Note 4.6 "Other financial assets") against a net investment in the odd associate.
No impairment loss was recognised on the associates or the joint ventures in 2021.
For companies consolidated under the equity method, the results of the sensitivity tests demonstrate that:
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Financial investments | 1.6 | 1.4 |
| Loans | 80.3 | 138.1 |
| Other financial investments | 37.4 | 43.0 |
| Total | 119.3 | 182.5 |
The overall decrease in other financial assets of €(63.2) million at 31 December 2022 is mainly due to the neutralisation of a loan to a joint venture in which the Group has taken control as well as the impairment loss recognised on associates.
The maturity of other financial assets (excluding financial investments) breaks down as follows:
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| < 1 year | 4.8 | 17.6 |
| > 1 year & < 5 years | 102.9 | 154.5 |
| > 5 years | 10.0 | 8.9 |
| Total | 117.7 | 181.0 |
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Prepaid expenses | 6.6 | 8.1 |
| Miscellaneous receivables | 4.3 | 4.7 |
| Total Gross value for other receivables (non-current) | 10.9 | 12.8 |
| Write-down for miscellaneous receivables | (1.5) | (1.4) |
| Total Write-down for other receivables (non-current) | (1.5) | (1.4) |
| Total | 9.4 | 11.4 |
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Gross value of inventories | 208.0 | 188.8 |
| Raw materials, supply and goods | 152.4 | 136.2 |
| Intermediate and finished products | 55.6 | 52.6 |
| Write-down | (46.3) | (45.7) |
| Raw materials, supply and goods | (31.0) | (34.1) |
| Intermediate and finished products | (15.3) | (11.5) |
| Total | 161.7 | 143.1 |
Inventories mainly consist of:
▪ parts required for the maintenance of installed street furniture,
▪ street furniture and billboards in kit form.
As of 31 December 2022, France contributed €79.4 million to the total gross value, including 73% of inventories in work in progress and 27% of maintenance inventories.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Trade receivables | 593.2 | 561.8 |
| Miscellaneous receivables | 31.6 | 22.7 |
| Other operating receivables | 15.9 | 19.2 |
| Miscellaneous tax receivables | 99.6 | 78.7 |
| Receivables on disposal of assets and equipment grant to be received | 0.0 | 0.0 |
| Down payments | 4.8 | 7.7 |
| Prepaid expenses | 61.3 | 81.9 |
| Total Gross value for Trade and other receivables | 806.4 | 771.9 |
| Write-down for trade receivables | (29.1) | (27.4) |
| Write-down for miscellaneous receivables | (1.4) | (1.4) |
| Write-down for other operating receivables | (0.1) | (0.1) |
| Total Write-down for Trade and other receivables | (30.5) | (28.9) |
| Total | 775.9 | 743.0 |
The increase in trade receivables remains limited during the period of business recovery thanks to further sales of receivables at year end. Thus the increase in the "trade and other receivables" heading of €32.9 million at 31 December 2022, is mainly a result of business activity of €15.0 million, of changes in scope related to acquisitions of €11.7 million, of currency effects of €3.6 million and of reclassifications of €2.6 million. The balance of past-due and un-provisioned trade receivables was €260.5 million as of 31 December 2022 compared to €222.5 million as of 31 December 2021. Of the un-provisioned trade receivables 9.6% were overdue by more than 90 days as of 31 December 2022 compared to 5.1% as of 31 December 2021. These receivables are held mainly against media agencies or international groups where debt recovery risk is low.
As of 31 December 2022, the Group has completed a non-recourse sale of trade receivables for an outstanding amount of €200.5 million. The assigned trade receivables were derecognised as of 31 December 2022 in accordance with the provisions of IFRS 9, with substantially all the risks and rewards associated with said assigned receivables transferred to the bank.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Cash | 303.1 | 689.5 |
| Cash equivalents | 1,616.4 | 804.2 |
| Total cash and cash equivalents | 1,919.5 | 1,493.8 |
| Treasury financial assets | 46.8 | 46.0 |
| Total managed cash | 1,966.3 | 1,539.7 |
The Group has €1,966.3 million managed cash as of 31 December 2022, compared to €1,539.7 million as of 31 December 2021. The increase in managed cash follows the strengthening of the Group's liquidity with a €500 million bond issue in February 2022.
Cash and cash equivalents mainly include short-term deposits, money market funds and current account deposits. €4.4 million of the total of cash and cash equivalents were invested in guarantees as of 31 December 2022, compared to €5.2 million as of 31 December 2021.
As of 31 December 2022, treasury financial assets are composed of €46.8 million of short-term liquid investments (compared to €46.0 million as of 31 December 2021). These treasury financial assets have the main characteristics of cash equivalents but do not strictly comply with all the criteria to be qualified as such according to IAS 7.
Breakdown of deferred taxes:
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| PP&E, intangible assets and provisions for onerous contracts | (129.7) | (137.3) |
| Tax losses carried forward | 121.5 | 66.4 |
| Provisions for dismantling costs | 29.7 | 23.3 |
| Provisions for retirement and other benefits | 17.6 | 21.3 |
| IFRS16 leases | 74.5 | 69.4 |
| Other | 16.4 | 11.8 |
| Total | 130.0 | 54.9 |
The €75.1 million increase of deferred tax assets net of the deferred tax liabilities is essentially due to an increase in deferred tax assets on tax losses carried forward for €55.2 million, mainly related to the reversals of provisions.
As of 31 December 2022, the net deferred tax variations were as follows:
| In million euros | 31/12/2021 Net expense | Reclassifications (1) |
DT on actuarial gains and losses |
Translation adjustments |
Changes in scope |
Other | 31/12/2022 | |
|---|---|---|---|---|---|---|---|---|
| Deferred tax assets | 142.0 | 74.9 | (10.9) | (2.9) | 1.0 | 4.4 | 1.4 | 209.9 |
| Deferred tax liabilities | (87.1) | (4.3) | 10.9 | (1.4) | 0.8 | 0.5 | 0.9 | (79.9) |
| Total | 54.9 | 70.5 | (0.0) | (4.3) | 1.8 | 4.9 | 2.3 | 130.0 |
(1) In connection with the presentation of the net deferred tax position at the level of each company or tax group.
As of 31 December 2021, the net deferred tax variations were as follows:
| In million euros | 31/12/2020 | Net expense | Reclassifications (1) |
DT on actuarial gains and losses |
Translation adjustments |
Changes in scope |
Other | 31/12/2021 |
|---|---|---|---|---|---|---|---|---|
| Deferred tax assets | 119.0 | 42.6 | (17.5) | (1.6) | 4.6 | (3.7) | (1.4) | 142.0 |
| Deferred tax liabilities | (98.8) | (0.4) | 17.5 | (2.3) | (3.1) | (0.0) | 0.0 | (87.1) |
| Total | 20.2 | 42.2 | 0.0 | (3.9) | 1.5 | (3.7) | (1.4) | 54.9 |
(1) In connection with the presentation of the net deferred tax position at the level of each company or tax group.
As of 31 December 2022, the amount of deferred tax assets on unrecognised losses carried forward was €201.3 million, compared to €213.1 million as of 31 December 2021.
As of 31 December 2022, share capital amounted to €3,245,684.82 divided into 212,902,810 shares of the same class and fully paid up.
| Number of outstanding shares as of 1 January 2022 | 212,902,810 |
|---|---|
| Shares issued following the exercise of options | 0 |
| Number of outstanding shares as of 31 December 2022 | 212,902,810 |
| The Group holds 113,720 treasury shares as of 31 December 2022. |
The Group did not grant any free share allocation plan or stock option plan in 2022.
The cost associated with all current plans amounted to €6.1 million in 2022.
The General Meeting of Shareholders held on 11 May 2022 decided to not pay a dividend for any of the 212,902,810 shares making up the share capital at 31 December 2021.
Non-controlling interests do not represent a significant portion of the 2021 and 2022 Group consolidated financial statements.
Provisions break down as follows:
| 31/12/2021 | Allocations Discount (2) | Reversals | Actuarial gains and losses/ assets ceiling |
Reclassificat ion |
Translation adjustments |
Changes in scope |
31/12/2022 | |||
|---|---|---|---|---|---|---|---|---|---|---|
| In million euros | Used | Not used |
||||||||
| Provisions for dismantling cost (1) |
289.9 | 118.0 | (34.4) | (16.5) | (3.7) | (0.9) | 10.5 | 362.9 | ||
| Provisions for retirement and other benefits |
99.9 | 11.3 | 1.1 | (6.2) | (0.5) | (25.5) | 0.0 | 0.3 | 0.6 | 81.1 |
| Provisions for risks and litigation |
50.8 | 12.0 | (4.8) | (4.5) | 1.3 | (0.0) | 54.7 | |||
| Provisions for onerous contracts |
21.4 | 21.4 | 0.1 | (6.3) | (2.3) | (0.3) | 3.0 | 37.1 | ||
| Total | 462.1 | 162.7 | (33.1) | (33.8) | (11.1) | (25.5) | 0.0 | 0.3 | 14.1 | 535.8 |
(1) Increase in the dismantling provision (offset against PP&E) heavily impacted by dependence on the inflation rate.
(2) Including €(37.7) million recognised versus PP&E.
Provisions consist mainly of provisions for dismantling costs regarding advertising assets in respect of Street Furniture and Transport businesses. They are calculated at the end of each fiscal year and are based on the assets pool and their unitary dismantling cost (labour, cost of destruction and restoration of ground surfaces). As of 31 December 2022, the average residual contract term used to calculate the provision for dismantling costs is 7.6 years.
Individual rates have been applied to each country since 2019. A weighted average discount rate was calculated based on each country's dismantling provision for the needs of the sensitivity analysis. The sensitivity analysis at 31 December 2022 used this weighted average discount rate for dismantling provisions, calculated as 2.6%, compared to 0.85% rate used at 31 December 2021. Therefore, a 25-basis point reduction in the weighted average discount rate to 2.35% would have generated an additional provision of approximately €6.8 million.
As of 31 December 2022, the reversal of provisions for dismantling costs amounts to €200.1 million over a time horizon less than or equal to 5 years; it amounts to €91.8 million over a time horizon ranging between 5 and 10 years and to €71.0 million after 10 years.
The Group's defined employee benefit obligations mainly consist of retirement benefits (contractual termination benefits, pensions and other retirement benefits for senior executives of certain Group subsidiaries) and other longterm benefits paid throughout the employee's career, such as long service awards or jubilees.
The Group's retirement benefits mainly involve France and the United Kingdom.
In France, termination benefits paid at retirement are calculated in accordance with the "Convention Nationale de la Publicité" (Collective Bargaining Agreement for Advertising) for the main entities. A portion of the obligation is covered by contributions made to an external fund by the French companies of JCDecaux Group. The fund was fully repaid in fiscal year 2022.
In the United Kingdom, retirement obligations mainly consist of a pension plan previously opened to some employees of JCDecaux UK Ltd. In December 2002, the vesting rights for this plan were frozen.
Provisions are calculated according to the following assumptions:
| 2022 | 2021 | |
|---|---|---|
| Discount rate (1) | ||
| Euro Zone | 3.75% | 0.90% |
| United Kingdom | 4.75% | 1.90% |
| Estimated annual rate of increase in future salaries | ||
| Euro Zone | 2.15% | 1.98% |
| United Kingdom (2) | NA | NA |
| Inflation rate | ||
| Euro Zone | 2.00% | 1.80% |
| United Kingdom | 2.75% | 2.85% |
(1) The discount rates for the Euro Zone and the United Kingdom are taken from Iboxx data and are determined based on the yield rate of bonds issued by highly rated companies (rated AA).
(2) As the UK plan was frozen, no salary increase was taken into account.
Retirement benefits and other long-term benefits (before tax) in 2022 break down as follows:
| Retirement benefits | Other long-term | Total | |||
|---|---|---|---|---|---|
| In million euros | unfunded | funded | benefits | ||
| Change in benefit obligation | |||||
| Benefit obligation at the beginning of the year | 30.9 | 133.3 | 8.3 | 172.4 | |
| Service cost | 1.8 | 3.5 | (0.4) | 5.0 | |
| Interest cost | 0.3 | 1.8 | 0.1 | 2.2 | |
| Acquisitions / disposals of plans | 0.8 | 0.0 | 0.0 | 0.8 | |
| Modifications / curtailments of plans | 0.0 | 0.0 | (0.1) | (0.1) | |
| Actuarial gains/losses (1) | (7.9) | (34.2) | (0.2) | (42.3) | |
| Employee contributions | 0.2 | 0.2 | |||
| Benefits paid | (0.9) | (4.3) | (0.9) | (6.1) | |
| Translation adjustments | 0.4 | (1.9) | (0.0) | (1.5) | |
| Benefit obligation at the end of the year | 25.4 | 98.4 | 6.8 | 130.5 | |
| including France | 15.1 | 42.0 | 2.7 | 59.8 | |
| including other countries | 10.3 | 56.4 | 4.1 | 70.8 | |
| Change in plan assets | |||||
| Assets at the beginning of the year | 72.6 | 72.6 | |||
| Interest income | 1.1 | 1.1 | |||
| Return on plan assets excluding amounts included in interest income | (16.9) | (16.9) | |||
| Modifications / curtailments of plans | (5.8) | (5.8) | |||
| Employer contributions | 4.4 | 4.4 | |||
| Employee contributions | 0.2 | 0.2 | |||
| Benefits paid | (4.3) | (4.3) | |||
| Translation adjustments | (1.8) | (1.8) | |||
| Assets at the end of the year | 49.5 | 49.5 | |||
| including France | 0.0 | 0.0 | |||
| including other countries (2) | 49.5 | 49.5 | |||
| Provisions | |||||
| Funded status | 25.4 | 48.9 | 6.8 | 81.1 | |
| Assets ceiling | 0.0 | ||||
| Provisions at the end of the year | 25.4 | 48.9 | 6.8 | 81.1 | |
| including France | 15.1 | 42.0 | 2.7 | 59.8 | |
| including other countries | 10.3 | 6.9 | 4.1 | 21.3 | |
| Pension cost | |||||
| Interest cost | 0.3 | 1.8 | 0.1 | 2.2 | |
| Interest income | (1.1) | (1.1) | |||
| Modifications / curtailments of plans | 5.8 | 5.8 | |||
| Service cost | 1.8 | 3.5 | 1.1 | 6.5 | |
| Amortisation of actuarial gains/losses on other long-term benefits | (1.5) | (1.5) | |||
| Charge for the year | 2.1 | 10.0 | (0.2) | 11.9 | |
| including France | 1.4 | 9.0 | (0.7) | 9.7 | |
| including other countries | 0.7 | 1.0 | 0.5 | 2.2 |
(1) Including €(0.5) million related to experience gains and losses, €(42.3) million related to financial assumptions and €0.5 million related to demographic assumptions.
(2) Mainly the United Kingdom.
As of 31 December 2022, the Group's benefit obligation amounted to €130.5 million and mainly involved two countries: France (46% of the total benefit obligation) and the United Kingdom (30%).
The valuations were performed by an independent actuary who also conducted sensitivity tests for each of the plans.
The results of the sensitivity tests demonstrate that:
The variances observed during the sensitivity tests do not call into question the rates taken for the preparation of the financial statements, deemed to be the rates that are the closest match to the market.
Net movements in provisions for retirement and other benefits are as follows:
| In million euros | 2022 | 2021 |
|---|---|---|
| 1 January | 99.9 | 113.4 |
| Charge for the year | 11.9 | 1.4 |
| Translation adjustments | 0.3 | 1.6 |
| Contributions paid | (4.4) | (2.5) |
| Benefits paid | (1.8) | (1.2) |
| Change in actuarial gains and losses on post-employment benefit plans and assets ceiling | (25.5) | (12.8) |
| Other | 0.6 | 0.0 |
| 31 December | 81.1 | 99.9 |
| Which are recorded: | ||
| - In EBIT | (4.6) | 3.0 |
| - In Financial income (loss) | (1.1) | (0.7) |
| - In Other comprehensive income | 25.5 | 12.8 |
The breakdown of the related plan assets is as follows:
| 31/12/2022 | 31/12/2021 | ||||
|---|---|---|---|---|---|
| In M€ | In % | In M€ | In % | ||
| Shares | 18.1 | 37% | 29.3 | 40% | |
| Bonds | 7.3 | 15% | 17.4 | 24% | |
| Corporate bonds | 7.0 | 14% | 10.2 | 14% | |
| Real Estate | 2.5 | 5% | 3.2 | 5% | |
| Insurance contracts | 10.6 | 21% | 10.4 | 14% | |
| Other | 4.0 | 8% | 2.1 | 3% | |
| Total | 49.5 | 100% | 72.6 | 100% |
The plan assets are assets that are listed separately from real estate, which is not listed.
Retirement benefits and other long-term benefits (before tax) in 2021 break down as follows:
| Retirement benefits | Other long-term | Total | ||
|---|---|---|---|---|
| In million euros | unfunded | funded | benefits | |
| Change in benefit obligation | ||||
| Benefit obligation at the beginning of the year | 31.5 | 142.2 | 8.7 | 182.3 |
| Service cost | 1.8 | 3.9 | 0.5 | 6.2 |
| Interest cost | 0.1 | 1.2 | 0.1 | 1.4 |
| Acquisitions / disposals of plans | 0.0 | 0.0 | 0.0 | 0.0 |
| Modifications / curtailments of plans | (0.8) | (4.5) | (0.1) | (5.4) |
| Actuarial gains/losses (1) | (1.7) | (10.5) | (0.1) | (12.3) |
| Employee contributions | 0.2 | 0.2 | ||
| Benefits paid | (0.4) | (4.0) | (0.9) | (5.2) |
| Translation adjustments | 0.4 | 4.7 | 0.1 | 5.2 |
| Benefit obligation at the end of the year | 30.9 | 133.3 | 8.3 | 172.4 |
| including France | 20.0 | 52.3 | 3.9 | 76.2 |
| including other countries | 10.9 | 80.9 | 4.4 | 96.2 |
| Change in plan assets | ||||
| Assets at the beginning of the year | 69.0 | 69.0 | ||
| Interest income | 0.7 | 0.7 | ||
| Return on plan assets excluding amounts included in interest income | 0.5 | 0.5 | ||
| Acquisitions / disposals of plans | 0.0 | 0.0 | ||
| Employer contributions | 2.5 | 2.5 | ||
| Employee contributions | 0.2 | 0.2 | ||
| Benefits paid | (4.0) | (4.0) | ||
| Translation adjustments | 3.6 | 3.6 | ||
| Assets at the end of the year | 72.6 | 72.6 | ||
| including France | 5.8 | 5.8 | ||
| including other countries (2) | 66.8 | 66.8 | ||
| Provisions | ||||
| Funded status | 30.9 | 60.7 | 8.3 | 99.9 |
| Assets ceiling | 0.0 | |||
| Provisions at the end of the year | 30.9 | 60.7 | 8.3 | 99.9 |
| including France | 20.0 | 46.5 | 3.9 | 70.4 |
| including other countries | 10.9 | 14.2 | 4.4 | 29.5 |
| Pension cost | ||||
| Interest cost | 0.1 | 1.2 | 0.1 | 1.4 |
| Interest income | (0.7) | (0.7) | ||
| Modifications / curtailments of plans | (0.8) | (4.5) | (0.1) | (5.4) |
| Service cost | 1.8 | 3.9 | 1.1 | 6.8 |
| Amortisation of actuarial gains/losses on other long-term benefits | (0.6) | (0.6) | ||
| Charge for the year | 1.1 | (0.2) | 0.5 | 1.4 |
| including France | 0.6 | (1.1) | (0.2) | (0.7) |
| including other countries | 0.5 | 1.0 | 0.7 | 2.2 |
(1) Including €(1.6) million related to experience gains and losses, €(9.9) million related to financial assumptions and €(0.8) million related to demographic assumptions.
(2) Mainly the United Kingdom.
Future contributions to pension funds for the year 2023 are estimated at €2.2 million.
The average weighted duration is respectively 9 years and 13 years for the Euro Zone and the United Kingdom.
The JCDecaux UK Ltd pension plan in the United Kingdom has been closed since December 2002. Today only the deferred or retirees remain in this plan. "Funding" evaluations are carried out every three years in order to ascertain the level of the plan's deficit with the agreement of the Trustees and the employer in compliance with regulations. A schedule of contributions is set out up until 2028.
Contributions paid for defined contribution plans represented €32.1 million in 2022 compared to €27.4 million in 2021.
The Group takes part in three multi-employer defined benefit plans covered by assets in Sweden (ITP Plan). An evaluation is performed each year according to local standards. The benefit obligation of the company JCDecaux Sverige AB cannot currently be determined separately. As of 31 December 2021, the three plans were in a situation of profit for a total amount of €30.6 billion, at the national level, according to local evaluations specific to these commitments. The expense recognised in the consolidated financial statements for these three plans is the same as the contributions paid in 2022, i.e. €0.7 million. The future contributions of the three plans will be steady in 2023.
The Group also takes part in four multi-employer plans in the United States. The Group does not have sufficient information related to the assets and obligations of these plans, the amount of actuarial gains and losses, the service cost and the financial cost, all information necessary for the recognition of these plans as defined benefit plans. Therefore, they are recognised on the same basis as the defined contribution plans. The Group's annual contribution to these multi-employer plans in the United States amounts to €0.5 million.
Provisions for risks and litigation amounted to €54.7 million as of 31 December 2022 compared to €50.8 million as of 31 December 2021.
The JCDecaux Group is party to several legal disputes regarding the terms of implementation and conditions for some of its contracts with concession grantors and the terms and conditions governing supplier relations. In addition, the specific nature of its business (contracts with public authorities) may generate specific contentious procedures. The JCDecaux Group is party to litigation over the awarding or cancellation of street furniture, transport and billboard contracts, as well as tax litigation. In addition, in the context of their businesses, Group companies may be subject to actions/investigations from legal authorities/national competition authorities. Some are ongoing and should not lead to adverse material consequences for the Group.
The Group's Legal Department identifies all risks and litigation (nature, amounts, procedure, risk level), regularly monitors developments and compares this information with that held by the Finance Department. The amount of provisions recognised for risks and litigation is analysed case by case, based on the positions of the plaintiffs, the assessment of the Group's legal advisors, and any decisions handed down by a court.
The provisions for onerous contracts amounted to €37.1 million as of 31 December 2022 compared to €21.4 million as of 31 December 2021. They consist of provisions for onerous contracts recognised during the purchase price allocation exercise of €2.5 million and of provisions recognised following impairment tests of €34.6 million, compared to respectively €2.9 million and €18.5 million as of 31 December 2021.
Subsequent to a risk analysis, the Group deemed that it was not necessary to recognise a provision with respect to some ongoing proceedings regarding competition disputes, or tax disputes or the terms and conditions governing the implementation or awarding of contracts.
Concerning contingent liabilities, it should be noted that on April 12, 2022, the Group received from the Competition Authority a "Notification of grievances relating to practices implemented in the outdoor advertising sector in France" and submitted its observations within the two-month period allowed. Once the Competition Authority has analysed these comments, it will produce a report on which the Group will have another two months to comment before the matter is referred to the Competition Authority. The Group will continue to cooperate with the Competition Authority and to provide it with all necessary explanations to dispel its concerns, but it considers the complaint to be unfounded and has therefore not considered it appropriate to make a provision.
Subject to exceptions, no provision for dismantling costs regarding panels in respect of the Billboard business is recognised in the Group financial statements. Indeed, the Group deems that the dismantling obligation of the Billboard business corresponds to a contingent liability, as either the obligation is hardly likely or it cannot be estimated with sufficient reliability due to the uncertainty of the probable dismantling date that influences the discounting impact. Regarding panels that resemble street furniture, large format digital screens and the most spectacular advertising structures, the unitary dismantling cost of which is greater than for dismantling traditional panels, as well as for dismantling programme related to panels for which a high probability of dismantling exists in the short term and at our initiative, the Group had estimated the overall non-discounted dismantling cost at €19.6 million as of 31 December 2022, compared to €16.6 million as of 31 December 2021. In exceptional cases where a short-term dismantling obligation is identified, the Group may recognise a provision for dismantling costs for panels in the Billboard business.
| 31/12/2022 | 31/12/2021 | ||||||
|---|---|---|---|---|---|---|---|
| In million euros | Current portion |
Non-current portion |
Total | Current portion |
Non-current portion |
Total | |
| Gross financial debt | (1) | 993.3 | 1,916.4 | 2,909.7 | 336.9 | 2,116.7 | 2,453.6 |
| Financial derivatives assets | (2.5) | (2.5) | (0.6) | (0.6) | |||
| Financial derivatives liabilities | 4.2 | 4.2 | 4.9 | 4.9 | |||
| Hedging financial derivatives instruments | (2) | 1.7 | 0.0 | 1.7 | 4.3 | 0.0 | 4.3 |
| Cash and cash equivalents (*) | 1,919.5 | 1,919.5 | 1,493.8 | 1,493.8 | |||
| Bank overdrafts | (29.8) | (29.8) | (6.4) | (6.4) | |||
| Net cash | (3) | 1,889.7 | 0.0 | 1,889.7 | 1,487.4 | 0.0 | 1,487.4 |
| Treasury financial assets (*) | (4) | 46.8 | 0.0 | 46.8 | 46.0 | 0.0 | 46.0 |
| Net financial debt (excluding non-controlling interest purchase commitments) |
(5)=(1)+(2)- (3)-(4) |
(941.4) | 1,916.4 | 975.0 | (1,192.2) | 2,116.7 | 924.5 |
(*) Cash, cash equivalents and treasury financial assets are described in Note 4.10 "Managed cash".
The debts on commitments to purchase minority interests are recorded separately and therefore are not included in the financial debt. They are described in Note 4.15 "Debt on commitments to purchase non-controlling interests".
Financial instruments are described in Note 4.17 "Financial instruments".
The reconciliation of the cash flow variance with the change in gross financial debt is detailed in Note 6.4 "Reconciliation between the cash flows and the change in gross financial debt".
The debt analyses presented hereafter are based on the economic financial debt, which is equal to the gross financial debt on the balance sheet adjusted by the amortised cost impact:
| 31/12/2022 | ||||||
|---|---|---|---|---|---|---|
| Current | Non-current | Current | Non-current | |||
| In million euros | portion | portion | Total | portion | portion | Total |
| Gross financial debt | 993.3 | 1,916.4 | 2,909.7 | 336.9 | 2,116.7 | 2,453.6 |
| Impact of amortised cost | 1.0 | 3.8 | 4.8 | 0.6 | (1.0) | (0.4) |
| Economic financial debt | 994.3 | 1,920.2 | 2,914.5 | 337.5 | 2,115.7 | 2,453.2 |
The economic financial debt breaks down as follows:
| 31/12/2022 | ||||||
|---|---|---|---|---|---|---|
| In million euros | Current portion |
Non-current portion |
Total | Current portion |
Non-current portion |
Total |
| Bonds | 750.0 | 1,699.8 | 2,449.8 | 1,949.8 | 1,949.8 | |
| Commercial Paper (NEU/CP) | 100.0 | 100.0 | 200.0 | 200.0 | ||
| Bank borrowings | 90.3 | 189.8 | 280.1 | 83.9 | 156.3 | 240.1 |
| Miscellaneous borrowings | 28.5 | 30.5 | 59.0 | 35.3 | 9.7 | 45.0 |
| Accrued interest | 25.5 | 0.0 | 25.5 | 18.3 | 0.0 | 18.3 |
| Economic financial debt | 994.3 | 1,920.2 | 2,914.5 | 337.5 | 2,115.7 | 2,453.2 |
As of 31 December 2022, the Group's financial debt mainly includes the debt carried by JCDecaux SE:
The average effective interest rate of JCDecaux SE's debts was approximately 1.7% for fiscal year 2022.
JCDecaux SE also holds an undrawn committed revolving credit facility of €825.0 million maturing in June 2026, which includes a €100 million swingline for same-day short-term drawdowns.
If JCDecaux's credit rating goes below Baa3 (Moody's) or BBB- (Standard and Poor's), the revolving credit facility and the €150 million bank loan carried by JCDecaux SE require compliance with the ratio: net financial debt/operating margin strictly below 3.5.
JCDecaux SE is rated "Baa3" with a stable outlook by Moody's and "BBB-" with a negative outlook by Standard and Poor's (Moody's last rating is dated 31 March 2022, and that of Standard and Poor's 29 September 2022).
The Group's financial debt also includes:
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Less than one year | 994.3 | 337.5 |
| More than one year and less than 5 years | 819.6 | 1,515.8 |
| More than 5 years | 1,100.6 | 599.9 |
| Total | 2,914.5 | 2,453.2 |
| 31/12/2022 | 31/12/2021 | |||
|---|---|---|---|---|
| In M€ | In % | In M€ | In % | |
| Euro | 2,610.6 | 90% | 2,164.7 | 88% |
| Australian dollar | 191.4 | 7% | 173.6 | 7% |
| Chinese yuan | 144.7 | 5% | 80.3 | 3% |
| British pound sterling | 86.2 | 3% | 58.2 | 2% |
| US dollar | 25.1 | 1% | 105.7 | 4% |
| Japanese yen | 19.1 | 1% | 23.8 | 1% |
| South African Rand (1) | (11.8) | 0% | (11.3) | 0% |
| Emirati dirham (1) | (28.7) | (1)% | (38.9) | (2)% |
| Hong Kong dollar (1) | (51.8) | (2)% | (64.8) | (3)% |
| Riyal Saoudi Arabia (1) | (52.5) | (2)% | (38.0) | (2)% |
| Others (1) | (17.8) | (1)% | (0.1) | 0% |
| Total | 2,914.5 | 100% | 2,453.2 | 100% |
(1) Negative amounts correspond to lending positions.
| 31/12/2022 | 31/12/2021 | |||
|---|---|---|---|---|
| In M€ | In % | In M€ | In % | |
| Fixed rate | 2,595.3 | 89% | 2,203.6 | 90% |
| Floating rate | 319.2 | 11% | 249.7 | 10% |
| Total | 2,914.5 | 100% | 2,453.2 | 100% |
The debt on commitments to purchase non-controlling interests amounted to €107.5 million as of 31 December 2022, compared to €111.8 million as of 31 December 2021. It mainly relates to a put option on a company in Europe, exercisable in 2029 and for which the debt is calculated based on an estimation of the present value of the contractual exercise price.
The €(4.3) million decrease in the debt on commitments to purchase non-controlling interests in 2022 includes the revaluation and discounting impacts of debts on commitments to purchase non-controlling interests as well as the expiry of a put not exercised in Belgium.
The lease liabilities related to lease contracts as of 31 December 2022 are as follows:
| In million euros | 31/12/2021 | Increases | Interest | expense Decreases (1) Reclassificatio ns |
Other decreases (2) |
Changes in scope |
Translation adjustments |
31/12/2022 | |
|---|---|---|---|---|---|---|---|---|---|
| Lease liability on advertising space > 12 months |
2,454.5 | 459.5 | 0.0 | (0.9) | (621.1) | (144.5) | 102.2 | 28.3 | 2,277.9 |
| Lease liability on property > 12 months |
172.4 | 26.4 | 0.0 | (0.0) | (39.1) | (8.5) | 0.0 | 1.1 | 152.2 |
| Lease liability on vehicles > 12 months |
18.3 | 18.8 | 0.0 | (0.1) | (13.8) | (0.2) | 0.0 | (0.1) | 22.9 |
| Lease liability others > 12 months |
1.8 | 1.1 | 0.0 | 0.0 | (1.3) | (0.0) | 0.0 | 0.0 | 1.6 |
| Total lease liabilities - non current |
2,647.0 | 505.7 | 0.0 | (1.0) | (675.3) | (153.2) | 102.2 | 29.4 | 2,454.7 |
| Lease liability on advertising space< 12 months |
913.4 | 12.2 | 79.8 | (767.0) | 621.1 | 2.3 | 1.8 | 6.7 | 870.3 |
| Lease liability on property < 12 months |
38.4 | 0.6 | 4.2 | (43.8) | 39.0 | 0.0 | 0.0 | 0.1 | 38.4 |
| Lease liability on vehicles < 12 months |
9.6 | 0.4 | 0.1 | (13.4) | 13.8 | 0.0 | 0.0 | 0.0 | 10.5 |
| Lease liability others < 12 months |
0.6 | 0.0 | 0.1 | (1.0) | 1.3 | 0.0 | 0.0 | 0.0 | 1.0 |
| Accrued interest on lease liability < 12 months |
46.7 | 0.0 | 0.0 | (10.2) | (0.0) | 0.0 | 0.0 | 0.7 | 37.1 |
| Total lease liabilities - current |
1,008.8 | 13.2 | 84.1 | (835.5) | 675.3 | 2.3 | 1.7 | 7.4 | 957.3 |
| Total lease liabilities | 3,655.8 | 518.9 | 84.1 | (836.5) | 0.0 | (150.9) | 104.0 | 36.8 | 3,412.1 |
(1) Includes repayment of the principal for €(702.5) million, €(93.8) million in interest payments and rent concessions obtained for €(40.3) million and recorded in P&L (in accordance with the application of the IFRS 16 expedient or according to the IFRS16 standard for contracts with a force majeure clause). The rent concessions obtained in 2021 amounted to €(175.6) million.
(2) Includes the decrease of lease liability linked to reliefs treated as a modification of contracts because not falling within the scope of the IFRS 16 expedient (see Note 1.11.4 "IFRS 16 Rent concessions") as well as decreases related to the anticipated end of contracts.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Less than one year | 957.3 | 1,008.8 |
| More than one year and less than 5 years | 1,666.6 | 1,794.9 |
| More than 5 years | 788.1 | 852.1 |
| Total lease liabilities discounted | 3,412.1 | 3,655.8 |
| Discount impact | 309.1 | 275.8 |
| Total Non discounted future payments | 3,721.1 | 3,931.5 |
The Group uses financial instruments mainly for foreign exchange rate hedging purposes. The use of these financial instruments mainly concerns JCDecaux SE.
The Group's foreign exchange risk exposure is mainly generated by its business in foreign countries. However, because of its operating structure, the JCDecaux Group is not very vulnerable to currency fluctuations in terms of cash flows, as the subsidiaries in each country do business in their own country and inter-company services and purchases are relatively insignificant. Accordingly, most of the foreign exchange risk stems from the translation of local-currency-denominated accounts to the euro-denominated consolidated accounts.
The foreign exchange risk on flows is mainly related to financial activities (refinancing and recycling of cash with foreign subsidiaries pursuant to the Group's cash centralisation policy). The Group hedges this risk mainly with short-term currency swaps. Consequently, as of 31 December the average exchange rates of the foreign exchange financial instruments are close to the exchange rates at closing.
As a result of inter-company loans and borrowings elimination upon consolidation, only the value of the hedging instruments is presented in the assets or liabilities of the statement of financial position.
As of 31 December 2022, the main foreign exchange rate financial instruments contracted by the Group were as follows (net positions):
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Forward purchases against euro: | ||
| Emirati dirham | 30.3 | 40.1 |
| Saudi riyal | 52.5 | 37.9 |
| Swedish krone | 14.9 | 13.9 |
| Norwegian krone | 14.8 | 12.4 |
| American dollar | 9.2 | 0.0 |
| South African rand | 9.3 | 9.9 |
| Others | 8.7 | 48.5 |
| Forward sales against euro: | ||
| Australian dollar | 192.3 | 173.5 |
| British pound sterling | 111.9 | 66.6 |
| Hong Kong dollar | 5.8 | 0.0 |
| Colombian peso | 3.4 | 1.3 |
| Brazilian real | 2.8 | 12.6 |
| Others | 9.9 | 83.4 |
| Forward purchase against Chinese yuan: | ||
| Hong Kong dollar | 61.9 | 19.3 |
| Forward purchases against British pound sterling: | ||
| Chinese yuan | 3.8 | 0.3 |
| Emirati dirham | 1.6 | 0.0 |
| Others | 2.4 | 1.3 |
| Forward sales against British pound sterling: | ||
| American dollar | 2.9 | 0.0 |
| Others | 0.2 | 0.2 |
| Forward sale against Thai baht: | ||
| American dollar | 11.2 | 11.4 |
As of 31 December 2022, the foreign exchange financial instruments had a market value of €(1.7) million compared to €(4.3) million as of 31 December 2021.
The ineffective portion of cash flow hedges was zero as of 31 December 2022 and 31 December 2021.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Trade payables and other operating liabilities | 660.4 | 625.7 |
| Tax and employee-related liabilities | 258.6 | 235.2 |
| Deferred income | 95.6 | 95.9 |
| Payables on the acquisition of assets | 71.8 | 24.8 |
| Other payables | 59.5 | 57.6 |
| Total | 1,145.9 | 1,039.3 |
Operating liabilities have a maturity of one year or less.
The €106.6 million increase as of 31 December 2022 is mainly due to the recognition of acquisitions of intangible assets payables for €61.8 million, to flows from operating activities for €42.8 million, to changes in scope for €10.2 million and to currency effects for €3.8 million, partially offset by the payment on acquisitions of financial assets payables for €(11.2) million.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Income tax payable | 24.3 | 22.7 |
| Current tax assets | (25.0) | (27.3) |
| Total | (0.7) | (4.6) |
Financial assets and liabilities by category as of 31 December 2022 were as follows:
| 31/12/2022 | |||||||
|---|---|---|---|---|---|---|---|
| In million euros | Fair value through income statement |
Fair value through other comprehensive income |
Cash flow hedges and NIH |
Amortised cost |
Total net carrying amount |
Fair value |
|
| Financial derivatives (assets) | (1) | 2.5 | 2.5 | 2.5 | |||
| Other financial assets | (2) | 1.6 | 117.7 | 119.3 | 119.3 | ||
| Trade and other receivables (non- current) |
(3) | 1.4 | 1.4 | 1.4 | |||
| Trade, miscellaneous and other operating receivables (current) |
(3) | 610.2 | 610.2 | 610.2 | |||
| Cash | 303.1 | 303.1 | 303.1 | ||||
| Cash equivalents | (4) | 1,616.4 | 1,616.4 | 1,616.4 | |||
| Treasury financial assets | (1) | 46.8 | 46.8 | 46.8 | |||
| Total financial assets | 1,968.8 | 1.6 | 0.0 | 729.3 | 2,699.6 | 2,699.6 | |
| Financial debt | (5) | (2,909.7) | (2,909.7) | (2,715.0) | |||
| Debt on commitments to purchase non-controlling interests |
(2) | (107.5) | (107.5) | (107.5) | |||
| Financial derivatives (liabilities) |
(1) | (4.2) | (4.2) | (4.2) | |||
| Trade and other payables and other operating liabilities (current) |
(3) | (784.0) | (784.0) | (784.0) | |||
| Other payables (non-current) (3) | (9.3) | (9.3) | (9.3) | ||||
| Bank overdrafts | (29.8) | (29.8) | (29.8) | ||||
| Total financial liabilities | (141.5) | 0.0 | 0.0 | (3,703.0) | (3,844.5) | (3,649.8) |
(1) The fair value measurement of these financial assets and liabilities uses valuation techniques that are based on observable market data (Level 2 category in accordance with IFRS 13 (§93a and b)).
(2) The fair value measurement of these financial assets and liabilities uses valuation techniques that are based on non-observable market data (Level 3 category in accordance with IFRS 13 (§93a and b)). The main assumption impacting the fair value of debts on commitments to purchase non-controlling interests is the discount rate, which stood at 2.0% as of 31 December 2022 on the main commitment. A decrease of 50 bps in the discount rate would lead to a €3.0 million increase in the debt on commitments to purchase non-controlling interests.
(3) Employee and tax-related receivables and payables, lease liabilities, down payments, deferred income and prepaid expenses that do not meet the IAS 32 definition of a financial asset or a financial liability, are excluded from these items.
(4) The fair value measurement of these financial assets refers to quoted prices in an active market for €756.9 million (Level 1 category in accordance with IFRS 13 (§93a and b)) and uses valuation techniques that are based on observable market data (Level 2 category in accordance with IFRS 13 (§93a and b)) for €859.5 million.
(5) The fair value measurement of these financial liabilities refers to quoted prices in an active market for bonds whose fair value amounts to €2,255.1 million (Level 1 category in accordance with IFRS 13 (§93a and b)) and uses valuation techniques that are based on observable market data (Level 2 category in accordance with IFRS 13 (§93a and b)) for €459.9 million.
Financial assets and liabilities by category as of 31 December 2021 break down as follows:
| 31/12/2021 | |||||||
|---|---|---|---|---|---|---|---|
| In million euros | Fair value through income statement |
Fair value through other comprehensive income |
Cash flow hedges and NIH |
Amortised cost |
Total net carrying amount |
Fair value |
|
| Financial derivatives (assets) (1) | 0.6 | 0.6 | 0.6 | ||||
| Other financial assets | (2) | 1.4 | 181.0 | 182.5 | 182.5 | ||
| Trade and other receivables (non- current) |
(3) | 2.0 | 2.0 | 2.0 | |||
| Trade, miscellaneous and other operating receivables (current) |
(3) | 574.7 | 574.7 | 574.7 | |||
| Cash | 689.5 | 689.5 | 689.5 | ||||
| Cash equivalents | (4) | 804.2 | 804.2 | 804.2 | |||
| Treasury financial assets | (1) | 46.0 | 46.0 | 46.0 | |||
| Total financial assets | 1,540.3 | 1.4 | 0.0 | 757.8 | 2,299.5 | 2,299.5 | |
| Financial debt | (5) | (2,453.6) | (2,453.6) | (2,549.9) | |||
| Debt on commitments to purchase non-controlling interests |
(2) | (111.8) | (111.8) | (111.8) | |||
| Financial derivatives (liabilities) |
(1) | (4.9) | (4.9) | (4.9) | |||
| Trade and other payables and other operating liabilities (current) |
(3) | (702.1) | (702.1) | (702.1) | |||
| Other payables (non-current) (3) | (7.7) | (7.7) | (7.7) | ||||
| Bank overdrafts | (6.4) | (6.4) | (6.4) | ||||
| Total financial liabilities | (123.1) | 0.0 | 0.0 | (3,163.4) | (3,286.4) | (3,382.8) |
(1) The fair value measurement of these financial assets and liabilities uses valuation techniques that are based on observable market data (Level 2 category in accordance with IFRS 13 (§93a and b)).
(2) The fair value measurement of these financial assets and liabilities uses valuation techniques that are based on non-observable market data (Level 3 category in accordance with IFRS 13 (§93a and b)). The main assumption impacting the fair value of debts on commitments to purchase non-controlling interests is the discount rate, which stood at 0.0% as of 31 December 2021 on the main commitment. An increase of 50 bps in the discount rate would lead to a €4.0 million decrease in the debt on commitments to purchase non-controlling interests.
(3) Employee and tax-related receivables and payables, lease liabilities, down payments, deferred income and prepaid expenses that do not meet the IAS 32 definition of a financial asset or a financial liability, are excluded from these items.
(4) The fair value measurement of these financial assets refers to quoted prices in an active market for €362.5 million (Level 1 category in accordance with IFRS 13 (§93a and b)) and uses valuation techniques that are based on observable market data (Level 2 category in accordance with IFRS 13 (§93a and b)) for €441.7 million.
(5) The fair value measurement of these financial liabilities refers to quoted prices in an active market for bonds whose fair value amounts to €2,046.1 million (Level 1 category in accordance with IFRS 13 (§93a and b)) and uses valuation techniques that are based on observable market data (Level 2 category in accordance with IFRS 13 (§93a and b)) for €503.8 million.
IFRS revenue amounted to €3,074.0 million in 2022 compared to €2,522.5 million in 2021, an increase of 21.9%.
The contributions of the three business lines - Street Furniture, Transport and Billboard - to 2022 IFRS revenue were €1,676.0 million, €920.9 million and €477.0 million, respectively, (compared to €1,390.1 million, €723.9 million and €408.5 million respectively in 2021).
IFRS advertising revenue stood at €2,746.7 million in 2022 (versus €2,211.0 million in 2021) and the IFRS nonadvertising revenue totalled €327.3 million in 2022 (versus €311.4 million in 2021).
| In million euros | 2022 | 2021 |
|---|---|---|
| Rent and fees Core Business | (517.4) | (283.4) |
| Other net operational expenses | (545.2) | (478.7) |
| Taxes and duties | (7.1) | (6.0) |
| Staff costs | (681.8) | (590.5) |
| Direct operating expenses & Selling, general & administrative expenses (1) | (1,751.5) | (1,358.5) |
| Provision charge net of reversals | (1.1) | 18.7 |
| Depreciation and amortisation net of reversals | (1,071.7) | (1,095.0) |
| Impairment of goodwill | 0.0 | (0.0) |
| Maintenance spare parts | (46.0) | (37.3) |
| Other operating income | 80.9 | 45.3 |
| Other operating expenses | (21.3) | (27.1) |
| Total | (2,810.6) | (2,453.9) |
(1) Including €(1,198.2) million in "Direct operating expenses" and €(553.3) million in "Selling, general & administrative expenses" in 2022 (compared to €(893.4) million and €(465.1) million in 2021, respectively).
In 2022, rent and fees broke down as follows:
| Rent and fees | Non-Core | |
|---|---|---|
| Core Business | Business rents | |
| In million euros | (1) | (1) & (2) |
| Variable lease expenses | (323.0) | 0.0 |
| Short-term lease expenses | (18.9) | (3.5) |
| Low -value lease expenses |
(16.5) | (4.3) |
| Fixed lease expenses on contracts w ith substantive substitution right clauses |
(158.9) | 0.0 |
| Total | (517.4) | (7.8) |
(1) Core business rents are related to location lease contracts for advertising structures and non-core business rents are related to real estate and vehicle rental.
(2) Included in the "Other net operational expenses" line.
Variable expenses are determined based on contractual terms and conditions: rent and fees that fluctuate according to revenue levels are considered as variable expenses. In 2022 and 2021, in accordance with the recommendations of the amendment to IFRS 16, these variable expenses benefit from the favourable effect of the extinguishment of lease liabilities in line with the negotiation of fixed and minimum guaranteed rents for periods ending in maximum prior to June 2022, except contracts with a force majeure clause. This favourable effect represents the majority of the "Gains and losses on lease contracts" item in the 2022 and 2021 statement of cash flows.
Renegotiations of the guaranteed minimums were less in 2022 than in 2021. 2022 was marked by a 21.9% increase in revenue compared to 2021 and a 18.9% increase in rent and fees (€(1,350.7) million in 2022 compared to €(1,136.3) million in 2021, including right-of-use amortisation and interest on lease liabilities for contracts restated under IFRS 16). 2021 was marked by a 20.1% increase in revenue compared to 2020 and a 5.7% increase in rent and fees.
A simulation of the sensitivity of rent and fees to changes in revenue based on contract terms alone is not relevant because the specific context of the Covid-19 crisis has demonstrated the Group's ability, when faced with a significant decrease in revenue, to negotiate material reductions in fixed and minimum guarantee rent and fees, as well as variable fee rates.
In 2021, rent and fees broke down as follows:
| Rent and fees | Non-Core | |
|---|---|---|
| Core Business | Business rents | |
| (1) | (1) & (2) | |
| Variable lease expenses | (136.2) | 0.0 |
| Short-term lease expenses | (15.9) | (4.9) |
| Low -value lease expenses |
(37.6) | (2.5) |
| Fixed lease expenses on contracts w ith substantive substitution right clauses |
(93.7) | 0.0 |
| Total | (283.4) | (7.4) |
(1) Core business rents are related to location lease contracts for advertising structures and non-core business rents are related to real estate and vehicle rental.
Non-Core business rents, which amounted to €(7.8) million in 2022, are fixed expenses and are detailed in the above paragraph.
Non-capitalised research and development costs are included in "Other net operational expenses" and in "Staff costs". They amounted to €14.1 million in 2022, compared to €8.8 million in 2021.
This item includes taxes and similar charges other than income tax. The principal taxes recorded under this item are property taxes.
This item includes salaries, social security contributions, share-based payments and employee benefits, including furniture installation and maintenance staff, research and development personnel, sales team and administrative personnel. The positive impact of state aid related to temporary unemployment is included in this item.
It also covers the expenses associated with profit-sharing and investment plans for French employees and retirement expenses.
| In million euros | 2022 | 2021 |
|---|---|---|
| Compensation and other benefits | (555.2) | (475.5) |
| Social security contributions | (120.5) | (114.0) |
| Share-based payments (1) | (6.1) | (1.0) |
| Total | (681.8) | (590.5) |
(1) Including expense related to free share plan for €(6.1) million in 2022, assuming a turnover of 2.9% and excluding employer charges recorded in the social charges line, compared to €(1.0) million in 2021, assuming a turnover of 3.1% and excluding employer charges recorded in the social charges line.
The Group granted a free shares plan in 2021 subject to presence and performance conditions.
| In million euros |
|---|
| vehicle rental. (2) Included in the "Other net operational expenses" line. |
| Other net operational expenses |
| This item includes five main cost categories: |
| ▪ subcontracting costs for certain maintenance operations, ▪ the cost of services and supplies relating to operations, ▪ billboard advertising stamp duties and taxes, ▪ non-core business rents on short-term and low-value contracts. |
| above paragraph. |
| Research and development costs |
| Taxes and duties |
| are property taxes. |
| Staff costs |
| retirement expenses. |
| social charges line. |
| Breakdown of the free shares plan: |
| 2021 Plan |
| Grant date 31/10/2021 |
| Number of beneficiaries 321 |
| 71 |
| Number of free shares | 1,063,818 |
|---|---|
| Risk-free rate (in %) | (0.50) |
| Dividend payment rate (in %) (1) | 2.08 |
| Fair value of free share (2) | €20.74 |
(1) Consensus of financial analysts on future dividends (source: Bloomberg).
(2) The fair value does not include the impact of turnover.
At the end of fiscal year 2022, the potential number of free shares amounted to 1,032,154 shares, after the cancellation of 31,664 shares, including 29,531 over the period.
Breakdown of stock option plans (1):
| 2017 Plan | 2016 Plan | 2015 Plan | |
|---|---|---|---|
| Grant date | 13/02/2017 | 17/02/2016 | 16/02/2015 |
| Vesting date | 13/02/2020 | 17/02/2019 | 16/02/2018 |
| Expiry date | 13/02/2024 | 17/02/2023 | 16/02/2022 |
| Number of beneficiaries | 188 | 270 | 173 |
| Number of options granted | 344,108 | 866,903 | 546,304 |
| Strike price before adjustment (2) | €29.77 | €34.01 | €31.29 |
| Strike price after adjustment (2) | N/A | N/A | €31.12 |
| Repricing - Adjustment of the number of options (2) | N/A | N/A | 3,145 |
| Number of options outstanding at the end of the period | 301,527 | 690,356 | 0 |
(1) The Group has not granted any stock-option plans since 2017.
(2) Following the simplified public tender offer (OPAS) launched by JCDecaux SE in June 2015 at a unit price of €40, 12,500,000 shares were repurchased on 17 July 2015, and subsequently cancelled. As a result, the number of options previously granted and still outstanding at the date of the OPAS was adjusted by an adjustment coefficient of 1.0056. The exercise price of the options was also adjusted to ensure that the effects of the OPAS on the rights of option holders would be neutral.
The adjustment related to the OPAS had no impact on the IFRS 2 "Share-based payment" charge.
Stock option movements during the period and average strike price by category of options:
| PERIOD | 2022 | Average share price at the date of exercise |
Average strike price |
2021 | Average share price at the date of exercise |
Average strike price |
|---|---|---|---|---|---|---|
| Number of options outstanding at the beginning of the period | 1,472,474 | €32.25 | 2,051,904 | €32.06 | ||
| - Options granted during the period | 0 | - € | 0 | - € | ||
| - Options forfeited during the period | 79,029 | €31.99 | 73,740 | €32.23 | ||
| - Options exercised during the period | 0 | - € | - € | 0 | - € | - € |
| - Options expired during the period | 401,562 | €31.12 | 505,690 | €31.51 | ||
| Number of options outstanding at the end of the period | 991,883 | €32.72 | 1,472,474 | €32.25 | ||
| Number of options exercisable at the end of the period | 991,883 | €32.72 | 1,472,474 | €32.25 |
The plans were valued using the Black & Scholes model based on the following assumptions:
| Assumptions | 2017 | 2016 | 2015 |
|---|---|---|---|
| - Price of underlying at grant date | €30.02 | €34.90 | €31.75 |
| - Estimated volatility | 23.38% | 25.56% | 25.51% |
| - Risk-free interest rate | (0.11)% | (0.24)% | (0.03)% |
| - Estimated option life (in years) | 4.5 | 4.5 | 4.5 |
| - Estimated turnover | 4.70% | 4.70% | 4.70% |
| - Dividend payment rate (1) | 2.21% | 1.77% | 1.77% |
| - Fair value of options (2) | €4.32 | €6.09 | €5.51 |
(1) Consensus of financial analysts on future dividends (source: Bloomberg).
(2) The fair value does not include the impact of turnover.
The preferred option for lifespan refers to the period running from the grant date to Senior Management's best estimate of the most likely date of exercise.
As the Group had more extensive historical data for the valuation of the 2015 to 2017 plans, it was able to fine-tune its assumptions for the calculation of volatility. As a result, the first year of listing was not included in the volatility calculation, as this was considered abnormal due primarily to the sharp movements in share price inherent with the IPO and the effect of 11 September 2001.
Furthermore, based on observed behaviours, when the plans were issued the Group considered that the options would be exercised at an average of 4.5 years after the grant date.
Net allocations of provisions increased by €19.8 million and amortisation net of reversals decreased by €23.3 million including €22.1 million of amortisation of right-of-use and €1.3 million of amortisation of PP&E and intangible assets.
In 2022, net allocations of provisions mainly correspond to reversals of provisions for dismantling costs totalling €18.8 million, allocation of provisions for employee benefits for €(4.6) million, reversals of provisions for onerous contracts due to the accounting treatment of acquisitions for €0.7 million, allocation of provisions following impairment tests for €(13.5) million and allocation of provisions for risks and charges for €(2.6) million.
In 2021, net reversals of provisions mainly correspond to reversals of provisions for dismantling costs totalling €16.6 million, reversals of provisions for employee benefits for €3.0 million, reversals of provisions for onerous contracts due to the accounting treatment of acquisitions for €0.6 million, allocation of provisions following impairment tests for €(2.0) million and reversals of provisions for risks and charges for €0.5 million.
In 2022, this item included a net depreciation of €(17.7) million relating to impairment tests carried out, including €(0.2) million of net depreciation on PP&E and intangible assets, €(4.0) million of net depreciation of right-of-use amortisation and €(13.5) million of net allocations of provisions for onerous contracts.
In 2021, this item included a net depreciation of €(7.6) million relating to impairment tests carried out, including €(8.0) million of net depreciation on PP&E and intangible assets, €2.4 million in net reversals of right-of-use amortization and €(2.0) million of net allocations of provisions for onerous contracts.
The item comprises the cost of spare parts for street furniture as part of maintenance operations for the advertising network, excluding glass panel replacements and cleaning products, and inventory impairment losses.
Other operating income and expenses break down as follows:
| In million euros | 2022 | 2021 |
|---|---|---|
| Gain on disposals of financial assets and gain on changes in scope | 63.4 | 4.4 |
| Gain on disposals of intangible assets and PP&E | 6.4 | 12.8 |
| Other management income | 2.5 | 3.2 |
| P&L effect following changes on IFRS16 Non Core Business contracts | 0.5 | 1.2 |
| P&L effect following changes on IFRS16 Core Business contracts | 8.1 | 23.6 |
| Other operating income | 80.9 | 45.3 |
| Loss on disposals of financial assets and loss on changes in scope | 0.0 | (0.5) |
| Loss on disposals of intangible assets and PP&E | (2.6) | (4.7) |
| Other management expenses | (18.7) | (21.9) |
| Other operating expenses | (21.3) | (27.1) |
| Total | 59.6 | 18.2 |
In 2022, gains on disposals of financial assets and gain on changes in scope amounted to a total of €63.4 million. They mainly relate to the takeover of a company in the United States.
In 2021, gains on disposals of financial assets and gain on changes in scope amounted to a total of €4.4 million. They mainly concerned the impact of deconsolidation following the ongoing liquidations of entities in Latin America for €3.7 million.
In 2022, the P&L impact regarding changes in core business leases amounted to €8.1 million. This mainly stemmed from the withdrawal of contracts in Singapore and the United States from the scope of IFRS 16. These impacts amounted to €23.6 million in 2021.
In 2022, other management expenses for €(18.7) million mainly include acquisition costs in the amount of €(6.5) million and restructuring costs in the amount of €(4.4) million.
In 2021, other management expenses for €(21.9) million mainly included restructuring costs in the amount of €(6.2) million and the payment of a VAT dispute for €(9.0) million, provisioned at the end of December 2020.
In 2022, the Group benefited from various State aid and government measures totalling €3.7 million (part-time working assistance or other). In 2021, the Group benefited from State aid related to Covid 19 totalling €34.6 million.
| In million euros | 2022 | 2021 | |
|---|---|---|---|
| Interest income | 11.0 | 4.0 | |
| Interest expense | (53.2) | (41.7) | |
| Net interest expense | (42.1) | (37.7) | |
| Amortised cost impact | (1.3) | 0.0 | |
| Cost of net financial debt | (1) | (43.4) | (37.7) |
| Net foreign exchange gains (losses) and hedging costs | (6.9) | (1.2) | |
| Net discounting losses | 2.0 | (3.6) | |
| Bank guarantee costs | (1.5) | (1.8) | |
| Charge to provisions for financial risks | (0.1) | (0.2) | |
| Reversal of provisions for financial risks | 0.2 | 0.2 | |
| Provisions for financial risks - Net charge | 0.1 | (0.0) | |
| Income on the sale of financial investments | 0.1 | 0.0 | |
| Expense on the sale of financial investments | (0.1) | (0.2) | |
| Net income (loss) on the sale of financial investments | 0.0 | (0.2) | |
| Other | (1.8) | (0.5) | |
| Other net financial expenses | (2) | (8.0) | (7.2) |
| Net financial income (loss) excluding IFRS16 | (3)=(1)+(2) | (51.4) | (44.9) |
| Interests on IFRS 16 lease liabilities | (84.1) | (82.2) | |
| Net financial income (loss) | (135.6) | (127.1) | |
| Total financial income | 13.4 | 4.2 | |
| Total financial expenses | (148.9) | (131.4) |
The decline of €8.5 million in net financial income is mainly due to the net debt cost increase following the issuance of a new €500 million bond at the beginning of February 2022, mitigated by the increase in interest income from investments following the interest rates increase as at the end 2022.
Breakdown between deferred and current taxes
| In million euros | 2022 | 2021 |
|---|---|---|
| Current tax | (48.2) | (28.6) |
| Local tax ("CVAE") | (2.8) | (2.5) |
| Other | (45.4) | (26.0) |
| Deferred taxes | 70.5 | 42.2 |
| Total | 22.3 | 13.6 |
In 2022, the effective tax rate before impairment of goodwill and the share of net profit of companies under the equity method was (17.5%), compared to 23.2% in 2021. Excluding the discounting and revaluation impacts of debts on commitments to purchase non-controlling interests, the effective tax rate was (18.0%) in 2022 compared to 24.0% in 2021.
| In million euros | 2022 | 2021 |
|---|---|---|
| Intangible assets, PP&E and provisions for onerous contracts | 9.1 | 26.9 |
| Tax losses carried forward | 55.4 | 28.7 |
| Provisions for dismantling costs | 6.3 | 1.4 |
| Provisions for retirement and other benefits | (0.4) | (1.7) |
| IFRS 16 leases | (0.3) | 2.5 |
| Other | 0.4 | (15.7) |
| Total | 70.5 | 42.2 |
| In million euros | 2022 | 2021 |
|---|---|---|
| Consolidated net income | 158.7 | 3.6 |
| Income tax charge | 22.3 | 13.6 |
| Consolidated income before tax | 136.4 | (10.0) |
| Share of net profit of companies under the equity method | (8.6) | (48.6) |
| Impairment of goodwill | 0.0 | 0.0 |
| Taxable dividends received from subsidiaries | 3.1 | 0.4 |
| Other non-taxable income | (107.8) | (21.5) |
| Other non-deductible expenses | 33.0 | 51.4 |
| Net income before tax subject to the standard tax rate | 56.1 | (28.3) |
| Weighted Group tax rate (1) | 13.40% | 62.64% |
| Theoretical tax charge | (7.5) | 17.7 |
| Deferred tax on unrecognised tax losses | (16.9) | (22.1) |
| Capitalisation and use of unrecognised prior year tax losses carried forward | 46.2 | 4.8 |
| Other deferred tax (temporary differences and other restatements) | (2.5) | 17.3 |
| Tax credits | 2.7 | 2.7 |
| Withholding tax | (5.1) | (1.4) |
| Tax on dividends | 0.0 | (0.3) |
| Other | 8.2 | (2.5) |
| Income tax calculated | 25.1 | 16.1 |
| Net Local tax ("CVAE") | (2.8) | (2.5) |
| Income tax recorded | 22.3 | 13.6 |
(1) National average tax rates weighted by taxable income.
In 2022, the share of net profit of associates totalled €(23.4) million compared to €16.5 million in 2021, and the share of net profit from joint ventures totalled €32.0 million in 2022 compared to €32.1 million in 2021.
In 2022, an impairment loss was recognised on joint ventures for €(1.4) million.
In 2022, an impairment loss was recognised on associates for €(28.0) million. This impairment loss is recorded in the balance sheet under "Other financial assets", in counterpart of the net investment of the impaired associated entity for which the value on the line "Investments under the equity method" is zero .
As of 31 December 2021, no impairment on associates and joint ventures has been recognised.
The information related to joint ventures and associates is presented in Note 11 "Information on joint ventures" and in Note 12 "Information on associates".
As of 31 December 2022, the Group's payroll comprised 10,687 employees, compared to 10,200 employees as of 31 December 2021. These figures do not include the share of employees from joint ventures representing 522 and 521 employees respectively as of 31 December 2022 and 31 December 2021.
The breakdown of the share of employees for the years 2022 and 2021 is as follows:
| 2022 | 2021 | |
|---|---|---|
| Technical | 5,378 | 5,192 |
| Sales and marketing | 2,614 | 2,457 |
| IT and administration | 2,040 | 1,914 |
| Contract business relations | 501 | 462 |
| Research and development | 153 | 175 |
| Total | 10,687 | 10,200 |
The breakdown of employees of joint ventures for the fiscal years 2022 and 2021 is as follows:
| 2022 | 2021 | |
|---|---|---|
| Technical | 252 | 244 |
| Sales and marketing | 153 | 157 |
| IT and administration | 100 | 98 |
| Contract business relations | 17 | 22 |
| Research and development | 0 | 0 |
| Total | 522 | 521 |
The increase in headcount in 2022 is due to the recovery in activity, particularly in France.
| 2022 | 2021 | |
|---|---|---|
| Weighted average number of shares for the purposes of earnings per share | 212,733,422 | 212,833,760 |
| Weighted average number of stock options potentially convertible | 991,883 | 1,472,474 |
| Weighted average number of stock options which would not be exercised at strike price (1) | (991,883) | (1,472,474) |
| Weighted average number of shares for the purposes of diluted earnings per share | 212,733,422 | 212,833,760 |
(1) This average number reflects the number of stock options which would not be exercised due to a granted strike price that was higher than the market price.
Earnings per share are calculated based on the weighted average number of outstanding shares (excluding treasury shares). The calculation of diluted earnings per share takes into account the dilutive effect from the exercise of stock options.
In 2022, the amount of the audit fees was as follows:
| In thousand euros | EY & other | KPMG Audit |
|---|---|---|
| Audit of statutory and consolidated accounts and limited audit | 2,323 | 1,985 |
| JCDecaux SE and its french subsidiaries (1) | 544 | 578 |
| Other controlled entities (1) | 1,778 | 1,407 |
| Non-audit services (2) | 524 | 194 |
| JCDecaux SE and its french subsidiaries (1) | 309 | 89 |
| Other controlled entities (1) | 215 | 105 |
| Total | 2,847 | 2,179 |
(1) The controlled entities taken into account are fully-consolidated subsidiaries.
(2) The services provided cover the non-audit services required by law and regulations, as well as non-audit services provided at the request of the entity. This concerns the services that fall within the scope of the services usually provided in addition to the statutory audit engagement (drawingup of specific attestations, performing agreed-upon procedures, establishing acquisition due diligences).
| In thousand euros | EY & Other | KPMG Audit |
|---|---|---|
| Audit of statutory and consolidated accounts and limited audit | 1,915 | 1,676 |
| JCDecaux SE and its french subsidiaries (1) | 506 | 522 |
| Other controlled entities (1) | 1,410 | 1,154 |
| Non-audit services (2) | 350 | 124 |
| JCDecaux SE and its french subsidiaries (1) | 93 | 36 |
| Other controlled entities (1) | 257 | 88 |
| Total | 2,265 | 1,800 |
(1) The controlled entities taken into account are fully-consolidated subsidiaries.
(2) The services provided cover the non-audit services required by law and regulations, as well as non-audit services provided at the request of the entity. This concerns the services that fall within the scope of the services usually provided in addition to the statutory audit engagement (drawingup of specific attestations, performing agreed-upon procedures, establishing acquisition due diligences).
In 2022, net cash flows from operating activities totalling €1,099.6 million comprised:
In 2021, net cash flows from operating activities of €1,001.8 million included the operating cash flows, for a total of €836.1 million and the change in working capital of €165.7 million
In 2022, net cash flows from investing activities totalling €(416.9) million comprised:
In 2021, net cash flows from investing activities totalling €(170.1) million included the cash payments on acquisitions of intangible assets and PP&E net of cash receipts on disposals for a total of €(150.3) million, cash payments on acquisitions of long-term investments net of cash receipts and cash acquired and sold for a total of €(16.0) million (including €(13.0) million of changes in payables and receivables on financial investments) and €(3.7) million of cash payments on acquisitions of other financial assets net of disposals. This amount mainly concerned a loan granted to an associate company in France for €(8.6) million offset by net refund of guarantees on contracts in China for €4.2 million.
In 2022, net cash flows from financing activities totalling €(280.8) million comprised:
In 2021, net cash flows from financing activities totalling €(934.4) million concerned repayments of lease liabilities for €(647.8) million, payment of dividends for €(9.9) million, cash payments on acquisitions of non-controlling interests net of cash receipts for €(2.6) million, disposals of treasury financial assets for €12.5 million, net cash flows on the borrowings of controlled entities for €(285.6) million, net capital increases for €0.2 million and purchases of treasury shares net of disposals for €(1.0) million.
| In million euros | 31/12/2021 | Repayment of long-term borrowings |
Increase in long term borrowings |
differences, consolidation scope variations, net impact of IFRS9 and accrued |
31/12/2022 |
|---|---|---|---|---|---|
| Bonds (amortised cost included) | 1,952.2 | 500.0 | (5.6) | 2,446.6 | |
| Commercial Paper (NEU/CP) | 200.0 | (1,112.5) | 1,012.5 | 0.0 | 100.0 |
| Bank borrow ings (amortised cost included) |
238.1 | (56.2) | 88.2 | 8.5 | 278.6 |
| Miscellaneous borrow ings |
45.0 | (10.5) | 23.2 | 1.3 | 59.0 |
| Accrued interest | 18.3 | 7.3 | 25.5 | ||
| Gross financial debt | 2,453.6 | (1,179.2) | 1,623.9 | 11.4 | 2,909.7 |
The Group is exposed to various financial risks (especially liquidity and financing risks, interest rate risk, foreign exchange rate risk and risks related to financial management, particularly counterparty risk). The Group's objective is to minimise such risks by choosing appropriate financial policies. The Group may nevertheless need to manage residual positions. This strategy is monitored and managed centrally by a dedicated team within the Group Finance Department. Risk management policies and hedging strategies are approved by Group management.
The table below presents the contractual cash flows (interest cash flows and contractual repayments) related to financial liabilities and financial instruments:
| Contractual | |||||||
|---|---|---|---|---|---|---|---|
| Carrying | cash flows | 2023 | 2024 | 2025 | 2026 | > 2026 | |
| amount | (*) | ||||||
| In million euros | |||||||
| Bonds | 2,446.6 | 2,640.9 | 793.4 | 635.8 | 23.9 | 23.9 | 1,163.9 |
| NEU CP (Commercial Paper) | 100.0 | 100.0 | 100.0 | ||||
| Bank borrowings at floating rate | 274.5 | 277.0 | 96.4 | 25.6 | 155.0 | ||
| Bank borrowings at fixed rate | 4.1 | 4.2 | 3.1 | 0.6 | 0.4 | 0.1 | |
| Miscelleanous borrowings | 59.0 | 59.1 | 52.0 | 7.1 | |||
| Accrued interest | 25.5 | ||||||
| Bank overdrafts | 29.8 | 29.8 | 29.8 | ||||
| Total financial liabilities excluding derivatives | 2,939.6 | 3,111.0 | 1,074.7 | 661.9 | 186.4 | 24.0 | 1,163.9 |
| Foreign exchange hedges | (1.7) | (1.7) | (1.7) | ||||
| Total financial instruments (**) | (1.7) | (1.7) | (1.7) | 0.0 | 0.0 | 0.0 | 0.0 |
| () The interest amounts paid are included in the contractual cash flows for each type of borrowing. (*) A negative amount represents a cash flow to be paid. |
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| The Group's financing strategy consists of: ▪ centralising financing at JCDecaux SE parent company level. Subsidiaries are therefore primarily financed |
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| through direct or indirect loans granted by JCDecaux SE to its subsidiaries. However, the Group may use external financing for certain subsidiaries, (i) depending on the tax, currency or regulatory environment; (ii) for subsidiaries not wholly owned by the Group; or (iii) for historical reasons (financing already in place when the subsidiary joined the Group), |
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| ▪ having available funding sources that (i) are diversified; (ii) have a term consistent with the maturity of its assets and (iii) are flexible, in order to cover the Group's growth and the investment and business cycles, |
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| ▪ having permanent access to a liquidity reserve such as committed credit facilities, |
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| ▪ minimising the risk of renewal of financing sources by staggering instalments, |
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| ▪ optimising financing margins through the early renewal of loans that are approaching maturity, or by refinancing certain financing sources when market conditions are favourable, |
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| ▪ optimising the cost of net debt by recycling as much as possible excess cash generated by different Group entities, in particular by repatriating the cash to JCDecaux SE through loans or dividend payments. |
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| As of 31 December 2022, 95% of the Group's financial debt was carried by JCDecaux SE with an average maturity of 3.1 years. The Group generates significant operating cash flows which allow it to self-finance organic growth. In the Group's |
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| opinion, external growth opportunities could lead it to temporarily increase this net debt. | |||||||
| As of 31 December 2022, the Group has €1,966.3 million in cash, cash equivalents and treasury financial assets (see Note 4.10 "Managed Cash") and an undrawn committed revolving credit facility of €825.0 million maturing June 2026, which includes a €100 million swingline for same-day short-term drawdowns. |
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| JCDecaux SE's financing sources are committed, but some of them require compliance with a ratio if JCDecaux's credit rating goes below Baa3 (Moody's) or BBB_ consolidated financial statements. |
(Standard and Poor's), for which the calculation is based on the | ||||||
| If JCDecaux's credit rating goes below Baa3 (Moody's) or BBB- (Standard and Poor's), the revolving credit facility and the €150 million bank loan carried by JCDecaux SE require compliance with the ratio: net financial debt/operating margin strictly below 3.5. |
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| JCDecaux SE is rated "Baa3" with a stable outlook by Moody's and "BBB-" with a negative outlook by Standard and Poor's (Moody's last rating is dated 31 March 2022, and that of Standard and Poor's 29 September 2022). |
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| The Group holds cash in some countries from which funds cannot be immediately repatriated, mainly because of regulatory restrictions. Nevertheless, the Group receives dividends on a regular basis from most of its subsidiaries located in these countries, and the cash is used for local purposes. |
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| Interest rate risk | |||||||
| 79 |
The Group is exposed to interest rate fluctuations because of its indebtedness. Given the context of low interest rates in recent years, the Group is mainly indebted at fixed rates. The breakdown between fixed rate and floating rate is described in Note 4.14 "Financial debt".
The following table breaks down financial assets and liabilities by interest rate maturity as of 31 December 2022:
| 31/12/2022 | |||||
|---|---|---|---|---|---|
| > 1 year | |||||
| In million euros | ≤ 1 year | & ≤ 5 years | > 5 years | Total | |
| JCDecaux SE borrowings | (1,062.6) | (599.9) | (1,099.9) | (2,762.4) | |
| Other borrowings | (141.4) | (8.9) | (1.8) | (152.1) | |
| Bank overdrafts | (29.8) | (29.8) | |||
| Financial liabilities | (1) | (1,233.8) | (608.8) | (1,101.7) | (2,944.3) |
| Cash and cash equivalents | 1,919.5 | 1,919.5 | |||
| Treasury financial assets | 46.8 | 46.8 | |||
| Other financial assets | 119.3 | 119.3 | |||
| Financial assets | (2) | 2,085.6 | 0.0 | 0.0 | 2,085.6 |
| Net position | (3)=(1)+(2) | 851.8 | (608.8) | (1,101.7) | (858.7) |
For fixed-rate assets and liabilities, the maturity indicated is that of assets and liabilities.
For floating rate assets and liabilities, the rates are adjusted every one, three or six months. The maturity indicated is therefore less than one year regardless of the maturity date.
As of 31 December 2022, 89% of the Group's total economic financial debt, all currencies considered, was on a fixed rate.
Despite its presence in more than 80 countries, the JCDecaux Group is relatively immune to currency fluctuations in terms of cash flows, as subsidiaries in each country do business in their own country and inter-company services and purchases are relatively insignificant.
However, as the Group's presentation currency is the Euro, the Group's consolidated financial statements are affected by the conversion into euros of financial statements denominated in local currencies.
In 2022, net income generated in currencies other than the euro accounted for 66.9% of the Group's consolidated net income.
Based on 2022 actual data, the table below details the Group's consolidated net income and reserves exposure to a (10)% change in the foreign exchange rates of each of the most represented currencies in the Group, those being the American dollar, the Brazilian real, the Saudi riyal, the Hong Kong dollar, the Australian dollar and the Chinese yuan:
| American dollar |
Brazilian real | Saudi riyal | Hong Kong dollar |
Australian dollar |
Chinese yuan |
|
|---|---|---|---|---|---|---|
| Share of the currencies in consolidated net income | 60.3% | 11.3% | 10.4% | (14.0%) | (16.5%) | (16.6%) |
| Impact on consolidated income | (6.4%) | (1.1%) | (1.0%) | 1.4% | 1.6% | 1.6% |
| Impact on consolidated reserves | 1.1% | 0.2% | (0.2%) | (1.9%) | (2.7%) | (1.0%) |
As of 31 December 2022, the Group held mainly foreign exchange currency hedges on financial transactions.
As part of the application of its centralised financing strategy, the Group has mainly implemented short-term foreign exchange currency swaps to hedge inter-company loans and borrowings transactions. The Group can decide not to hedge some of the foreign exchange risks generated by inter-company transactions when hedging arrangements are (i) too costly, (ii) not available, or (iii) when loan amounts are too small.
As of 31 December 2022, the Group considers that its earnings and financial position would not be materially affected by currency fluctuations.
As of 31 December 2022, the Group had €1,966.3 million of cash, cash equivalents and treasury financial assets, which include €1,919.5 million of cash and cash equivalents (including €1,616.4 million in cash equivalents) and €46.8 million of treasury financial assets. €4.4 million of the total cash and cash equivalents are invested in guarantees.
The Group is not subject to any external requirements in terms of equity management.
The Group uses financial instruments only to hedge foreign exchange risk.
JCDecaux SE is rated "Baa3" with a stable outlook by Moody's and "BBB-" with a negative outlook by Standard & Poor's as of the date of publication of these Notes.
Bonds issued by the Group for a total amount of €2,449.8 million include in their terms and conditions a change of control clause giving bond holders the possibility to request early repayment in the event of a change of control, when accompanied by a downgrade of the credit rating to speculative grade or a credit rating exit.
If JCDecaux's credit rating goes below Baa3 (Moody's) or BBB- (Standard and Poor's), the €825 million revolving credit facility and the €150 million bank loan carried by JCDecaux SE require compliance with the ratio: net financial debt/operating margin strictly below 3.5.
The Group's other primary financing sources (financing raised by the parent company), together with the main hedging arrangements, are not subject to early termination in the event of a downgrade of the Group's credit rating.
The Group's counterparty risk relates to the investment of the Group's excess cash with its banking partners and to other financial transactions mainly carried out by JCDecaux SE (via unused committed credit facilities and hedging commitments). The Group's policy is to minimise this risk by (i) reducing excess cash within the Group by centralising as much as possible the subsidiaries' available cash at JCDecaux SE level, (ii) obtaining prior authorisation from the Group's Finance Department before opening bank accounts, (iii) selecting banks in which JCDecaux SE and its subsidiaries can make deposits (iv) and monitoring this counterparty risk on a regular basis.
The counterparty risk in respect of trade receivables is covered by the necessary provisions if needed. The net book value of trade receivables is detailed in Note 4.9 "Trade and other receivables". The Group maintains a low level of dependence against any particular client, as no single client represents more than 3.1% of the Group's revenue.
The Group's excess cash may be invested in short-term investments or in short-term deposits. In the case of shortterm investments, the investments consist of money market securities. These instruments are invested on a shortterm basis, earn interest at money market benchmark rates, are liquid, and involve only limited counterparty risk.
The Group's policy is not to own shares or negotiable securities other than money market securities and its own shares. Consequently, the Group considers its risk exposure arising from shares and negotiable securities as very low.
The Group ensures the identification, prevention and proper control of the environmental risks to which it is exposed to ensure the sustainable development of its activities.
Sustainable Development has been integrated into the Group's risk mapping since 2009. Environmental risks are thus assessed during the annual review exercise.
In 2022, these environmental risks were not identified as material under the Declaration of Extra-Financial Performance (DPEF).
As JCDecaux operates in the outdoor advertising sector, the environmental risks associated with its street furniture, transport advertising and large-format billboard activities remain limited and, as of 31 December 2022, JCDecaux has not identified any significant risks in environmental matters likely to be provisioned in its accounts.
Established on all continents in more than 80 countries and 3,566 cities with more than 10,000 inhabitants, the Group is likely to see its local activities impacted by the main effects of climate change: increasingly frequent extreme events, a rise in sea levels, but also warmer temperatures and the scarcity of water resources. However, the very broad geographical distribution of its activities greatly limits any risk of significant financial impact.
In line with its 2014 strategy, reducing the Group's carbon footprint is a priority commitment of its CSR strategy for 2030 published in 2022. Indeed, the Group is committed to contributing to collective carbon neutrality with a pilot project initiated in France in 2021 and the development of its group Climate strategy in 2022.
The commitments made in terms of the transition to a low-carbon economy do not currently have any significant impact on the financial statements.
This work to reduce its energy impact is reflected in concrete actions such as:
In addition to these actions, JCDecaux defined a Group-wide Climate Strategy in 2022. This strategy, aligned with the ambitions of the Paris Agreement, aims to achieve Net Zero Carbon by 2050 by committing to a Science-Based Targets (SBTi)1 trajectory. To do this, JCDecaux is committed to reducing its short and long-term emissions company-wide according to the following two objectives:
At the beginning of 2023, the Group submitted its letter of commitment to SBTI by joining the global project "Business Ambition for 1.5°C".
1 The Science Based Targets initiative, also known as the SBT or SBTi, is a partnership between the CDP, the United Nations Global Compact, the World Resources Institute and the World Wide Fund for Nature which encourages companies to commit to targets reducing greenhouse gas emissions compatible with the objective of 1.5°C maximum warming.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Commitments given (1) | ||
| Business guarantees | 1,480.9 | 494.0 |
| Other guarantees | 43.6 | 38.4 |
| Pledges, mortgages and collateral | 5.8 | 6.6 |
| Commitments on securities (put options granted) | 0.7 | 0.5 |
| Total | 1,531.0 | 539.5 |
| Commitments received | ||
| Commitments on securities (call options received) | 11.9 | 0.7 |
| Credit facilities | 841.0 | 866.0 |
| Total | 852.9 | 866.7 |
(1) Excluding the commitments under leases signed but not started and excluding the commitments in advertising space contracts provision with substantive substitution rights.
"Business guarantees" are granted mainly by JCDecaux SE and JCDecaux North America Inc. As such, JCDecaux SE and JCDecaux North America Inc. guarantee the performance of contracts entered into by subsidiaries, either directly to third parties, or by counter-guaranteeing guarantees granted by banks or insurance companies. They include as of 31 December 2022 the commitments given on new contracts in China for around €0.9 billion.
"Other guarantees" include securities, endorsements and other guarantees such as (i) guarantees covering lease payments, (ii) JCDecaux SE's counter-guarantees of credit facilities granted by banks, and (iii) other commitments such as guarantees covering payments to suppliers and guarantees given in the context of litigation.
"Pledges, mortgages and collateral" mainly comprise cash amounts given in guarantee, and the mortgage of land and buildings in Germany.
"Commitments on securities" are granted and received primarily as part of external growth transactions.
Moreover, under certain advertising contracts, JCDecaux North America Inc., directly and indirectly through its subsidiaries and its joint venture partners, have granted, under the relevant agreements, reciprocal put/call options in connection with respective ownership in their shared companies.
Lastly, as part of agreements between shareholders, JCDecaux SE can grant or receive calls in the event that either party's contractual clauses are breached. Under partnership agreements, the Group and its partners benefit from pre-emptive rights and sometimes rights to purchase, tag along or drag along, which the Group does not consider as commitments given or received. Moreover, the Group does not mention the commitments that are subject to exercise conditions, thereby limiting the likelihood of any occurrence.
Credit facilities include the committed revolving credit facility secured by JCDecaux SE for €825.0 million and committed credit facilities granted to subsidiaries for €16.0 million.
Commitments to purchase property, plant and equipment and intangible assets totalled €458.2 million as of 31 December 2022 compared to €322.6 million as of 31 December 2021.
| In million euros | 31/12/2022 | 31/12/2021 |
|---|---|---|
| Lease advertising space | 5.9 | 45.3 |
| Lease property | 0.0 | 0.0 |
| Lease vehicles | 0.2 | 0.0 |
| Other lease | 0.0 | 0.0 |
| Total | 6.1 | 45.3 |
These commitments are recognised as a liability under IFRS 16 at the start date of the lease.
In the Street Furniture and Transport businesses, some contracts include a substantive substitution right on advertising spaces in favour of the contractor. As such, these contracts are considered to be service contracts excluded from the scope of IFRS16 application.
The amount of commitments given on these types of contract and for those beginning after 1 January 2019, totalled €1,526.1 million as of 31 December 2022 compared to €1,468.7 million as of 31 December 2021 (amounts are neither inflated nor discounted).
The following four categories are considered related party transactions:
| In million euros | 2022 | 2021 | ||||||
|---|---|---|---|---|---|---|---|---|
| Companies under the EM (1) |
Other shareholders (2) |
Other (3) | Total | Companies under the EM (1) |
Other shareholders (2) |
Other (3) | Total | |
| Statement of financial position | ||||||||
| Assets | ||||||||
| Right-of-use | 79.5 | 6.2 | 85.7 | 74.7 | 6.9 | 81.6 | ||
| Loans (*) | 61.9 | 0.0 | 0.0 | 62.0 | 124.1 | 0.0 | 0.0 | 124.1 |
| Other receivables | 31.1 | 1.2 | 0.5 | 32.7 | 24.7 | 1.7 | 0.2 | 26.6 |
| Total Assets | 93.0 | 80.6 | 6.7 | 180.3 | 148.8 | 76.4 | 7.1 | 232.3 |
| Liabilities | ||||||||
| Financial debts and debt on commitments to purchase non |
||||||||
| controlling interests (4) | 45.8 | 107.5 | 153.3 | 33.2 | 111.8 | 145.0 | ||
| Other liabilities (8) | 8.7 | 92.6 | 8.0 | 109.3 | 9.0 | 92.6 | 9.1 | 110.7 |
| Total Liabilities | 54.5 | 200.0 | 8.0 | 262.6 | 42.3 | 204.4 | 9.1 | 255.7 |
| Income Statement | ||||||||
| EBIT | ||||||||
| Income | 53.5 | 0.4 | 2.0 | 55.9 | 41.0 | 0.1 | 2.4 | 43.5 |
| Expenses (7) | (12.2) | (20.7) | (3.1) | (36.0) | (8.2) | (18.2) | (3.0) | (29.5) |
| EBIT | 41.3 | (20.4) | (1.1) | 19.9 | 32.8 | (18.1) | (0.6) | 14.1 |
| Net financial income (loss) | ||||||||
| Income (5) | 1.4 | 4.0 | 0.0 | 5.4 | 1.3 | 0.0 | 0.0 | 1.3 |
| Expenses (5) (6) | (0.7) | (1.1) | (0.1) | (1.8) | (0.2) | (3.4) | (0.1) | (3.6) |
| Net financial income (loss) | 0.8 | 2.9 | (0.1) | 3.6 | 1.1 | (3.4) | 0.0 | (2.3) |
(*) Including accrued interest.
The off-balance sheet commitments from leases with related parties are now, in accordance with IFRS 16, recorded as liabilities in the statement of financial position at their present value. This lease liability with related parties is recognised under "Other liabilities" in the table above and represented €96.8 million as of 31 December 2022 compared to €94.1 million as of 31 December 2021.
As of 31 December 2022, the commitments given as business guarantees with associates totalled €30.5 million.
Compensation due to members of the Executive Board for the years 2022 and 2021 breaks down as follows:
| In million euros | 2022 | 2021 |
|---|---|---|
| Short-term benefits | 8.6 | 7.8 |
| Fringe benefits | 0.3 | 0.3 |
| Directors'fees | 0.0 | 0.0 |
| Life insurance/special pension | 0.1 | 0.1 |
| Share-based payments (**) | 0.6 | 0.0 |
| Total (*) | 9.6 | 8.2 |
(*) Compensation received from associates is excluded.
(**) In respect of the bonus shares plan subject to presence and performance conditions, which represents a total benefit of €1.9 million, based on the number of shares granted to managers of 90,344, with a fair value of €20.74, spread over the service life.
In addition, should their employment contracts be terminated, two Executive Board members are entitled to receive non-competition compensation over a two-year period equal to 33% of their fixed and variable compensation, calculated on the basis of the average of the twelve months preceding the date of termination of contractual relations.
Post-employment benefits recognised as liabilities in the statement of financial position amounted to €3.7 million as of 31 December 2022 and amounted to €5.2 million as of 31 December 2021.
Compensation due to members of the Supervisory Board amounted to €0.4 million for the year 2022.
The following information related to the joint ventures is provided by operating segment pursuant to IFRS 12 "Disclosure of Interests in Other Entities".
The 2022 net income of the joint ventures and reconciliation with the income statement of the consolidated financial statements for 2022 are as follows:
| In million euros | Street Furniture | Transport | Billboard | Total |
|---|---|---|---|---|
| Net Income (1) | 35.0 | 37.6 | 2.5 | 75.1 |
| Impact of application of the holding percentage | (17.2) | (23.1) | (1.5) | (41.8) |
| Impairment of joint ventures | 0.0 | (1.3) | (0.1) | (1.4) |
| Share of net profit of joint ventures | 17.9 | 13.1 | 0.9 | 32.0 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
The 2022 revenue for the joint ventures and reconciliation with their contribution in the consolidated adjusted revenue for 2022 are as follows:
| In million euros | Revenue |
|---|---|
| Street Furniture | 146.4 |
| Transport | 348.7 |
| Billboard | 40.4 |
| Total (1) | 535.5 |
| Impact of application of the holding percentage | (272.9) |
| Elimination of the transactions inter-activities & with controlled entities | (3.3) |
| Contribution of the joint ventures in the Consolidated adjusted Revenue | 259.3 |
(1) IFRS data on a 100% basis before elimination of transactions made between the different activities and before elimination of transactions made with the controlled entities.
The other items of the income statement for 2022 that are characteristic of the joint ventures are as follows (1):
| In million euros | Street Furniture | Transport | Billboard |
|---|---|---|---|
| Depreciation, amortisation and provisions (net) | (26.3) | (51.3) | (13.9) |
| Cost of net financial debt | 0.2 | 1.7 | (1.4) |
| Income tax | (9.4) | (16.1) | 0.4 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
The 2021 net income of the joint ventures and reconciliation with the income statement of the consolidated financial statements for 2021 are as follows:
| Street | ||||
|---|---|---|---|---|
| In million euros | Furniture | Transport | Billboard | Total |
| Net Income (1) | 15.5 | 58.3 | 3.0 | 76.9 |
| Impact of application of the holding percentage | (7.7) | (35.4) | (1.7) | (44.8) |
| Impairment of joint ventures | 0.0 | 0.0 | 0.0 | |
| Share of net profit of joint ventures | 7.9 | 22.9 | 1.3 | 32.1 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
The 2021 revenue for the joint ventures and reconciliation with their contribution in the consolidated adjusted revenue for 2021 are as follows:
| In million euros | Revenue |
|---|---|
| Street Furniture | 103.3 |
| Transport | 352.6 |
| Billboard | 41.2 |
| Total (1) | 497.1 |
| Impact of application of the holding percentage | (261.0) |
| Elimination of the transactions inter-activities & with controlled entities | (2.8) |
| Contribution of the joint ventures in the Consolidated adjusted Revenue | 233.3 |
(1) IFRS data on a 100% basis before elimination of transactions made between the different activities and before elimination of transactions made with the controlled entities.
The other items of the income statement for 2021 that are characteristic of the joint ventures are as follows (1):
| In million euros | Street Furniture | Transport | Billboard |
|---|---|---|---|
| Depreciation, amortisation and provisions (net) | (26.1) | (47.7) | (15.0) |
| Cost of net financial debt | (0.1) | 1.2 | (1.2) |
| Income tax | (7.4) | (17.6) | 2.7 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
Other 2022 comprehensive income for the joint ventures and reconciliation with the statement of other comprehensive income of the consolidated financial statements for 2022 are as follows:
| Street | ||||
|---|---|---|---|---|
| In million euros | Furniture | Transport | Billboard | Total |
| Other comprehensive income (1) | 0.4 | (4.3) | (2.3) | (6.1) |
| Impact of application of the holding percentage | (0.2) | 2.7 | 1.1 | 3.7 |
| Translation reserve adjustments on impairment of joint ventures | 0.0 | 0.1 | 1.0 | 1.0 |
| Translation reserve adjustments on goodwill & elimination of shares | 0.2 | (0.8) | 0.0 | (0.6) |
| Share of other comprehensive income of the joint ventures | 0.4 | (2.3) | (0.2) | (2.0) |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
Other 2021 comprehensive income for the joint ventures and reconciliation with the statement of other comprehensive income of the consolidated financial statements for 2021 are as follows:
| Street | ||||
|---|---|---|---|---|
| In million euros | Furniture | Transport | Billboard | Total |
| Other comprehensive income (1) | 1.3 | 6.0 | (1.0) | 6.3 |
| Impact of application of the holding percentage | (0.6) | (3.6) | 0.5 | (3.7) |
| Translation reserve adjustments on impairment of joint ventures | 0.0 | (0.0) | (0.5) | (0.5) |
| Translation reserve adjustments on goodwill & elimination of shares | 0.3 | 4.7 | 0.0 | 5.0 |
| Share of other comprehensive income of the joint ventures | 0.9 | 7.1 | (0.9) | 7.1 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
Net assets (1) as of 31 December 2022 of the joint ventures and reconciliation with the statement of financial position of the consolidated financial statements as of 31 December 2022 are as follows:
| Street | ||||
|---|---|---|---|---|
| In million euros | Furniture | Transport | Billboard | Total |
| Non-current assets | 162.9 | 199.1 | 45.5 | 407.5 |
| Current assets | 110.6 | 184.4 | 18.5 | 313.6 |
| Non-current liabilities | (124.7) | (70.9) | (18.5) | (214.1) |
| Current liabilities | (77.6) | (170.1) | (18.9) | (266.6) |
| Net assets (1) | 71.2 | 142.6 | 26.5 | 240.3 |
| Impact of application of the holding percentage | (33.6) | (68.8) | (15.1) | (117.5) |
| Impairment of joint ventures | (9.6) | (1.3) | (7.8) | (18.7) |
| Goodwill and elimination of shares held by joint ventures | 12.6 | 51.3 | 5.6 | 69.5 |
| Negative Net Equity limitation | 2.5 | 3.0 | 5.6 | |
| Investments under the equity method | 43.1 | 126.8 | 9.2 | 179.1 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
The items related to the net financial debt as of 31 December 2022 characteristic of the joint ventures are as follows (1):
| In million euros | Street Furniture | Transport | Billboard |
|---|---|---|---|
| Cash and cash equivalents net of bank overdrafts | 9.3 | 65.5 | 2.3 |
| Financial debt (non-current) | (57.5) | (0.5) | (11.0) |
| Financial debt (current) | (1.9) | (1.7) | (3.1) |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
Net assets (1) as of 31 December 2021 of the joint ventures and reconciliation with the statement of financial position of the consolidated financial statements as of 31 December 2021 are as follows:
| Street | ||||
|---|---|---|---|---|
| In million euros | Furniture | Transport | Billboard | Total |
| Non-current assets | 143.3 | 186.5 | 151.0 | 480.9 |
| Current assets | 93.2 | 230.1 | 21.2 | 344.5 |
| Non-current liabilities | (111.2) | (56.1) | (154.9) | (322.3) |
| Current liabilities | (71.2) | (195.5) | (22.7) | (289.3) |
| Net assets (1) | 54.1 | 165.0 | (5.3) | 213.8 |
| Impact of application of the holding percentage | (25.6) | (83.5) | 1.4 | (107.7) |
| Impairment of joint ventures | (9.6) | (0.1) | (8.4) | (18.1) |
| Goodwill and elimination of shares held by joint ventures | 12.4 | 52.1 | 5.6 | 70.0 |
| Negative Net Equity limitation | 2.1 | 0.0 | 15.4 | 17.5 |
| Investments under the equity method | 33.3 | 133.5 | 8.7 | 175.6 |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
The items related to the net financial debt as of 31 December 2021 characteristic of the joint ventures are as follows (1):
| In million euros | Street Furniture | Transport | Billboard |
|---|---|---|---|
| Cash and cash equivalents net of bank overdrafts | 7.0 | 114.3 | 3.0 |
| Financial debt (non-current) | (48.4) | (0.7) | (48.2) |
| Financial debt (current) | (1.8) | (1.8) | (2.2) |
(1) IFRS data on a 100% basis without any elimination of transactions made between the different activities and without any elimination of transactions made with the controlled entities.
The dividends received from the joint ventures for the year 2022 break down as follows:
| In million euros | Street Furniture | Transport | Billboard |
|---|---|---|---|
| Dividends received | 9.4 | 24.7 | 1.2 |
The dividends received from the joint ventures for the year 2021 break down as follows:
| In million euros | Street Furniture | Transport | Billboard |
|---|---|---|---|
| Dividends received | 5.8 | 19.3 | 0.0 |
Income statement items characteristic of the significant entity APG|SGA SA and the reconciliation with the income statement of the consolidated financial statements are as follows:
| 2022 | 2021 | |
|---|---|---|
| In million euros | APG SGA SA | APG SGA SA |
| Revenue | 309.1 | 246.2 |
| Net income (1) | 22.0 | 21.7 |
| Impact of application of the holding percentage | (15.4) | (15.2) |
| Impairment of associates | 0.0 | 0.0 |
| Share of net profit of associates | 6.6 | 6.5 |
(1) IFRS data on a 100% basis.
The contribution of other companies in the share of net profit of associates totalled €(30.0) million in 2022 and €10.0 million in 2021.
Statement of financial position items(1) characteristic of the significant entity APG|SGA SA and the reconciliation with the statement of financial position of the consolidated financial statements as of 31 December 2022 and as of 31 December 2021 are as follows:
| 2022 | 2021 | |
|---|---|---|
| In million euros | APG SGA SA | APG SGA SA |
| Assets | 491.8 | 392.5 |
| Liabilities | (383.9) | (277.8) |
| Equity | 107.9 | 114.7 |
| Impact of application of the holding percentage | (75.6) | (80.3) |
| Impairment of associates | 0.0 | 0.0 |
| Goodwill | 82.9 | 82.9 |
| Investments in associates | 115.3 | 117.3 |
The contribution of other companies in investments in associates in the statement of financial position totalled €117.5 million as of 31 December 2022 and €121.5 million as of 31 December 2021.
The valuation of 30% of APG|SGA SA at the 30 December 2022 share price amounts to €146.7 million.
The dividends received from associates for the fiscal years 2022 and 2021 break down as follows:
| 2022 | 2021 | |||||
|---|---|---|---|---|---|---|
| APG SGA SA | Other | Total | APG SGA SA | Other | Total | |
| In million euros | companies | companies | ||||
| Dividends received | 9.1 | 7.0 | 16.1 | 0.0 | 3.6 | 3.6 |
As of 31 December 2022, JCDecaux Holding holds 65.46% of the share capital of JCDecaux SE.
| CONSOL. | % | ||||
|---|---|---|---|---|---|
| COMPANIES | COUNTRY | % INTEREST | METHOD | CONTROL | |
| STREET FURNITURE | * | ||||
| JCDecaux SE (previously JCDecaux SA) | France | 100.00 | F | 100.00 | |
| JCDecaux FRANCE | (1) | France | 100.00 | F | 100.00 |
| SOPACT | France | 100.00 | F | 100.00 | |
| SOMUPI | France | 66.00 | F | 66.00 | |
| JCDecaux ASIE HOLDING | France | 100.00 | F | 100.00 | |
| JCDecaux EUROPE HOLDING | France | 100.00 | F | 100.00 | |
| JCDecaux AMERIQUES HOLDING | France | 100.00 | F | 100.00 | |
| CYCLOCITY JCDecaux AFRIQUE HOLDING |
France France |
100.00 100.00 |
F F |
100.00 100.00 |
|
| JCDecaux BOLLORE HOLDING | France | 50.00 | E* | 50.00 | |
| SOCIETE FERMIERE DES COLONNES MORRIS SOCIETE INFORMATION COMMUNICATION |
France France |
100.00 100.00 |
F F |
100.00 100.00 |
|
| MOBILITE - SICM | |||||
| JCDecaux MOBILITE AIX-MARSEILLE | France | 100.00 | F | 100.00 | |
| JCDecaux SUPPLY CHAIN | France | 100.00 | F | 100.00 | |
| SOCIETE HAVRAISE DE MOBILIER URBAIN | France | 100.00 | F | 100.00 | |
| SOCIETE EURO METROPOLITAINE DE MOBILIER URBAIN |
France | 100.00 | F | 100.00 | |
| SOCIETE DE MOBILIER URBAIN DE CAGNES SUR MER |
France | 100.00 | F | 100.00 | |
| SOCIETE DU MOBILIER URBAIN CANNOIS | (3) | France | 100.00 | F | 100.00 |
| SOCIETE DU MOBILIER URBAIN D'AIX MARSEILLE PROVENCE |
(3) | France | 100.00 | F | 100.00 |
| SOCIETE BORDELAISE DE MOBILIERS URBAINS | (3) | France | 100.00 | F | 100.00 |
| JCDecaux ADTECH | (3) | France | 100.00 | F | 100.00 |
| DISPLAYCE | (3) & (19) | France | 75.00 | F | 75.00 |
| PISONI PUBLICITE SAS | (1) & (3) & (23) |
France | 100.00 | F | 100.00 |
| EVIDENCE MEDIA SAS | (1) & (3) & (23) |
France | 100.00 | F | 100.00 |
| TENDANCE PIXXL SARL | (1) & (3) & (23) |
France | 100.00 | F | 100.00 |
| MIDI ESPACE SARL | (1) & (3) & (23) |
France | 100.00 | F | 100.00 |
| PUBLI-CITES EXPANSION SAS | (1) & (3) & (23) |
France | 100.00 | F | 100.00 |
| WALL GmbH | (1) | Germany | 100.00 | F | 100.00 |
| DSM DECAUX GmbH | Germany | 50.00 | E* | 50.00 | |
| STADTREKLAME NÜRNBERG GmbH | Germany | 35.00 | E | 35.00 | |
| DIE DRAUSSENWERBER GmbH | Germany | 100.00 | F | 100.00 | |
| SKY HIGH TG GmbH | Germany | 100.00 | F | 100.00 | |
| REMSCHEIDER GESELLSCHAFT FÜR | Germany | 50.00 | E* | 50.00 | |
| STADTVERKEHRSANLAGEN GbR. JCDecaux STREET FURNITURE Pty Ltd |
Australia | 100.00 | F | 100.00 | |
| JCDecaux AUSTRALIA Pty Ltd | Australia | 100.00 | F | 100.00 | |
| Australia | 100.00 | F | 100.00 | ||
| ADBOOTH Pty Ltd | |||||
| JCDecaux CITYCYCLE AUSTRALIA Pty Ltd | Australia | 100.00 | F | 100.00 | |
| JCDecaux AUSTRALIA UNIT TRUST | Australia | 100.00 | F | 100.00 | |
| ARGE AUTOBAHNWERBUNG GmbH | (16) | Austria | 67.00 | F | 100.00 |
| DIGITAL OUT OF HOME OO GmbH | Austria | 33.50 | E* | 50.00 | |
| JCDecaux STADMOBILIAR AZ | Azerbaïjan | 100.00 | F | 100.00 | |
| JCDecaux AZERBAIJAN LLC | Azerbaïjan | 50.00 | E* | 50.00 | |
| JCDecaux STREET FURNITURE BELGIUM | (1) | Belgium | 100.00 | F | 100.00 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| JCDecaux MALLS | Belgium | 73.36 | F | 73.36 | |
| JCDecaux DO BRASIL LTDA | Brazil | 100.00 | F | 100.00 | |
| JCDecaux SALVADOR MOBILIARIO URBANO LTDA | Brazil | 100.00 | F | 100.00 | |
| JCDecaux LATAM SERVIÇOS DE MANAGEMENT LTDA |
Brazil | 100.00 | F | 100.00 | |
| CONCESSIONARIA A HORA DE SÃO PAULO LTDA | Brazil | 100.00 | F | 86.50 | |
| CEMUSA BRASILIA S.A. | Brazil | 100.00 | F | 100.00 | |
| CEMUSA AMAZONIA Ltda | Brazil | 100.00 | F | 100.00 | |
| CEMUSA RIO S.A. | Brazil | 100.00 | F | 100.00 | |
| WALL SOFIA EOOD | Bulgaria | 50.00 | E* | 50.00 | |
| OUTFRONT JCDecaux STREET FURNITURE CANADA, Ltd |
Canada | 50.00 | E* | 50.00 | |
| JCDecaux COMUNICACION EXTERIOR CHILE S.A. | (1) | Chile | 100.00 | F | 100.00 |
| JCDecaux PEARL&DEAN OUTDOOR ADVERTISING (CHINA) Co. Ltd |
China | 100.00 | F | 100.00 | |
| BEIJING PRESS JCDecaux MEDIA ADVERTISING Co. Ltd |
China | 50.00 | E* | 50.00 | |
| NINGBO JCDecaux Pearl &Dean ADVERTISING Co. Ltd |
(2) | China | 100.00 | F | 100.00 |
| JCDecaux CITYSCAPE HONG KONG Ltd | China | 100.00 | F | 100.00 | |
| JCDecaux CITYSCAPE Ltd | China | 100.00 | F | 100.00 | |
| JCDecaux MACAU | (1) | China | 80.00 | F | 80.00 |
| CITY LEAD DEVELOPMENTS. Ltd | (10) | China | 23.00 | E | 23.00 |
| EVER HARMONIC GLOBAL. Ltd | (11) | China | 20.50 | E | 23.00 |
| CLEAR MEDIA LIMITED | (12) | China | 20.50 | E | 23.00 |
| EQUIPAMIENTOS URBANOS NACIONALES DE COLOMBIA SAS |
(1) | Colombia | 75.00 | F | 75.00 |
| LLEGA S.A.S. | Colombia | 75.00 | F | 100.00 | |
| JCDecaux KOREA Inc. | South Korea | 80.00 | F | 80.00 | |
| JCDecaux TOP MEDIA COSTA RICA, SA. | (1) | Costa Rica | 76.16 | F | 100.00 |
| JCDecaux COTE d'IVOIRE | Ivory Coast | 50.00 | E* | 50.00 | |
| AFA JCDecaux A/S | (1) | Denmark | 50.00 | F | 50.00 |
| JCDecaux STREET FURNITURE FZ LLC | United Arab Emirates |
100.00 | F | 100.00 | |
| JCDecaux DXB MEDIA FZ LLC | United Arab Emirates |
75.00 | F | 75.00 | |
| JCDecaux ECUADOR SA. | Ecuador | 100.00 | F | 100.00 | |
| JCDecaux ESPANA SLU | (1) | Spain | 100.00 | F | 100.00 |
| JCDecaux ATLANTIS SA | Spain | 85.00 | F | 85.00 | |
| JCDecaux LATIN AMERICA INVESTMENTS HOLDING S.L.U |
Spain | 100.00 | F | 100.00 | |
| CORPORACION AMERICANA DE EQUIPAMIENTOS URBANOS SL. |
Spain | 100.00 | F | 100.00 | |
| CORPORACION EUROPEA DE MOBILIARIO URBANO S.A. |
(1) | Spain | 100.00 | F | 100.00 |
| JCDecaux EESTI OU | Estonia | 100.00 | F | 100.00 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| JCDecaux SAN FRANCISCO, LLC | United States | 100.00 | F | 100.00 | |
| JCDecaux MALLSCAPE, LLC | United States | 100.00 | F | 100.00 | |
| JCDecaux CHICAGO, LLC | United States | 100.00 | F | 100.00 | |
| OUTFRONT DECAUX STREET FURNITURE, LLC | United States | 50.00 | E* | 50.00 | |
| JCDecaux NORTH AMERICA, Inc. | United States | 100.00 | F | 100.00 | |
| JCDecaux BOSTON, Inc. | United States | 100.00 | F | 100.00 | |
| JCDecaux STREET FURNITURE, Inc. | United States | 100.00 | F | 100.00 | |
| JCDecaux STREET FURNITURE GREATER BOSTON, LLC |
United States | 100.00 | F | 100.00 | |
| JCDecaux STREET FURNITURE NEW YORK, LLC | United States | 100.00 | F | 100.00 | |
| JCDecaux FINLAND Oy | (1) | Finland | 100.00 | F | 100.00 |
| JCDecaux GABON | Gabon | 40.00 | E* | 40.00 | |
| JCDecaux TOP MEDIA GUATEMALA, SA | Guatemala | 76.16 | F | 100.00 | |
| VBM VAROSBUTOR ES MEDIA Kft. | Hungary | 67.00 | F | 100.00 | |
| JCDecaux HUNGARY Zrt | (1) | Hungary | 67.00 | F | 100.00 |
| JCDecaux ADVERTISING INDIA PVT Ltd | (1) | India | 100.00 | F | 100.00 |
| JCDecaux ISRAEL Ltd | Israel | 92.00 | F | 92.00 | |
| MCDECAUX Inc. | (1) | Japan | 85.00 | F | 85.00 |
| CYCLOCITY Inc. | Japan | 100.00 | F | 100.00 | |
| RTS DECAUX JSC | Kazakhstan | 50.00 | F | 50.00 | |
| JCDecaux LATVIJA SIA | Latvia | 100.00 | F | 100.00 | |
| JCDecaux LIETUVA UAB | Lithuania | 100.00 | F | 100.00 | |
| JCDecaux LUXEMBOURG SA | (1) | Luxembourg | 100.00 | F | 100.00 |
| EQUIPAMIENTOS URBANOS DE MEXICO, S.A. DE C.V. |
Mexico | 100.00 | F | 100.00 | |
| SERVICIOS DE COMERCIALIZACION DE PUBLICIDAD, S.A. DE C.V. |
Mexico | 100.00 | F | 100.00 | |
| SERVICIO Y TECNOLOGIA ESPECIALIZADA, S.A. DE C.V. |
Mexico | 60.00 | F | 100.00 | |
| MEDIOS DE PUBLICIDAD S.A. DE C.V. | Mexico | 60.00 | F | 100.00 | |
| JCDecaux OUT OF HOME MEXICO SA de CV | Mexico | 60.00 | F | 60.00 | |
| ESCATO URBANO, S.A. DE C.V. | Mexico | 60.00 | F | 100.00 | |
| PUBLITOP DE OCCIDENTE, S.A. DE C.V. | (1) & (21) | Mexico | 60.00 | F | 100.00 |
| JCDecaux MONGOLIA LLC | Mongolia | 51.00 | F | 51.00 | |
| FMIDecaux Co., Ltd. | Myanmar | 60.00 | F | 60.00 | |
| JCDecaux OMAN | (1) & (5) | Oman | 100.00 | F | 100.00 |
| JCDecaux UZ | Uzbekistan | 72.26 | F | 72.26 | |
| JCDecaux PANAMA, S.A. | Panama | 76.16 | F | 100.00 | |
| JCDecaux CENTRAL AMERICA HOLDING S.A. | Panama | 100.00 | F | 100.00 | |
| JCDecaux Top Media SA | Panama | 76.16 | F | 76.16 | |
| JCDecaux TOP MEDIA CORPORATIVO, S.A | Panama | 76.16 | F | 100.00 | |
| FUTURAD, S.A | Panama | 11.61 | E | 15.25 | |
| JCDecaux NEDERLAND BV | The Netherlands |
100.00 | F | 100.00 | |
| JCDecaux PORTUGAL - MOBILIARIO URBANO Lda | (1) | Portugal | 100.00 | F | 100.00 |
| PURBE PUBLICIDADE URBANA & GESTAO Lda | Portugal | 100.00 | F | 100.00 | |
| ELAN DECAUX W.L.L | (1) | Qatar | 50.00 | E* | 49.00 |
| JCDecaux DOMINICANA, SAS. | Dominican Rep. |
100.00 | F | 100.00 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| JCDecaux MESTSKY MOBILIAR Spol Sro | (1) | Czech Rep. | 100.00 | F | 100.00 |
| RENCAR MEDIA Spol Sro | Czech Rep. | 46.90 | F | 100.00 | |
| CLV CR Spol Sro | Czech Rep. | 46.90 | F | 100.00 | |
| United | |||||
| JCDecaux UK Ltd | (1) | Kingdom | 100.00 | F | 100.00 |
| JCDecaux SMALL CELLS Ltd | United Kingdom |
100.00 | F | 100.00 | |
| IN FOCUS PUBLIC NETWORKS LIMITED | United Kingdom |
100.00 | F | 100.00 | |
| VIOOH LIMITED | (1) | United Kingdom |
93.50 | F | 93.50 |
| JCDecaux EL SALVADOR, S.A. DE C.V. | Salvador | 76.16 | F | 100.00 | |
| JCDecaux SINGAPORE Pte Ltd | Singapore | 100.00 | F | 100.00 | |
| JCDecaux SLOVAKIA Sro | Slovakia | 100.00 | F | 100.00 | |
| JCDecaux SVERIGE AB | Sw eden | 100.00 | F | 100.00 | |
| OUTDOOR AB | Sw eden | 48.50 | E* | 48.50 | |
| JCDecaux SVERIGE | (24) | Sw eden | 100.00 | F | 100.00 |
| FORSALJNINGSAKTIEBOLAG JCDecaux CORPORATE SERVICES GmbH |
Sw itzerland | 100.00 | F | 100.00 | |
| JCDecaux URUGUAY | 100.00 | F | 100.00 | ||
| JCDecaux OOH URUGUAY SA | (6) | Uruguay | 100.00 | F | 100.00 |
| PUBLIBUS SA | (22) | Uruguay | 100.00 | F | 100.00 |
| TRANSPORT | Uruguay | ||||
| MEDIA AEROPORTS DE PARIS | France | 50.00 | E* | 50.00 | |
| METROBUS | France | 33.00 | E | 33.00 | |
| JCDecaux SPG OUTDOOR ADVERTISING (PTY) | |||||
| LTD | South Africa | 35.00 | E* | 50.00 | |
| MEDIA FRANKFURT GmbH | Germany | 39.00 | E* | 39.00 | |
| JCDecaux AIRPORT MEDIA GmbH | Germany | 100.00 | F | 100.00 | |
| JCDecaux ATA SAUDI LLC | Saudi Arabia | 60.00 | F | 60.00 | |
| BUSPAK ADVERTISING GROUP PTY LTD | Australia | 100.00 | F | 100.00 | |
| GSP PRINT PTY LTD | Australia | 100.00 | F | 100.00 | |
| INFOSCREEN AUSTRIA GmbH | Austria | 67.00 | F | 100.00 | |
| JCD BAHRAIN SPC | Bahrain | 100.00 | F | 100.00 | |
| CEMUSA DO BRASIL LTDA | Brazil | 100.00 | F | 100.00 | |
| JCDecaux MIDIA AEROPORTOS LTDA | Brazil | 100.00 | F | 100.00 | |
| JCDecaux TRILHOS LTDA (previously CEMUSA SALVADOR MOBILIARIO URBANO LTDA) |
(25) | Brazil | 100.00 | F | 100.00 |
| JCDecaux CAMEROUN | Cameroon | 50.00 | E* | 50.00 | |
| JCDecaux CHILE SA | (17) | Chile | 100.00 | F | 100.00 |
| JCDecaux MOMENTUM SHANGHAI AIRPORT ADVERTISING Co. Ltd |
China | 35.00 | E* | 35.00 | |
| JCDecaux ADVERTISING (BEIJING) Co. Ltd | China | 100.00 | F | 100.00 | |
| BEIJING TOP RESULT METRO Advertising. Co. Ltd | China | 33.00 | E | 33.00 | |
| JCDecaux ADVERTISING (SHANGHAI) Co. Ltd | China | 100.00 | F | 100.00 | |
| CHONGQING MPI PUBLIC TRANSPORTATION ADVERTISING Co. Ltd |
China | 60.00 | F | 60.00 | |
| CHENGDU MPI PUBLIC TRANSPORTATION Advertising. Co. Ltd |
China | 100.00 | F | 100.00 | |
| SHANGHAI SHENTONG JCDecaux METRO ADVERTISING Co. Ltd |
China | 60.00 | E* | 51.00 | |
| NANJING METRO JCDecaux ADVERTISING Co., | China | 100.00 | F | 100.00 | |
| Ltd JCDecaux ADVERTISING CHONGQING Co., Ltd |
China | 80.00 | F | 80.00 | |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| SUZHOU JCDecaux METRO ADVERTISING Co.Ltd | China | 80.00 | F | 65.00 | |
| NANJING JCDecaux BUS ADVERTISING Co., Ltd | China | 100.00 | F | 100.00 | |
| GUANGZHOU METRO JCDecaux ADVERTISING Co., Ltd |
China | 49.00 | E* | 49.00 | |
| GUANGZHOU JCDecaux AEROTROPOLIS ADVERTISING Co.,Ltd |
China | 100.00 | F | 100.00 | |
| TIANJIN METRO JCDecaux ADVERTISING Co., Ltd | (13) | China | 60.00 | E* | 60.00 |
| VIOOH CHINA LIMITED | China | 93.50 | F | 100.00 | |
| NANJING JCDecaux METRO VIOOH MEDIA | China | 100.00 | F | 100.00 | |
| TECHNOLOGY Co., Ltd | |||||
| WUHAN JCDecaux BUS ADVERTISING Co., Ltd | China | 65.00 | F | 65.00 | |
| JCDecaux Shanghai Shentong Metro Advertising | (3) | China | 60.00 | E* | 60.00 |
| Co. Ltd JCDecaux PEARL & DEAN Ltd |
China | 100.00 | F | 100.00 | |
| JCDecaux INNOVATE Ltd | China | 100.00 | F | 100.00 | |
| MEDIA PRODUCTION Ltd | China | 100.00 | F | 100.00 | |
| JCDecaux CHINA HOLDING Ltd | China | 100.00 | F | 100.00 | |
| TOP RESULT PROMOTION Ltd | China | 100.00 | F | 100.00 | |
| MEDIA PARTNERS INTERNATIONAL Ltd | China | 100.00 | F | 100.00 | |
| China | 100.00 | F | 100.00 | ||
| JCDecaux DIGITAL VISION (HK) Ltd. | China | 93.50 | F | 100.00 | |
| VIOOH (HK) LIMITED CNDECAUX AIRPORT MEDIA Co. Ltd |
China | 30.00 | E | 30.00 | |
| JCDecaux DICON FZCO | (15) | United Arab Emirates |
80.36 | F | 80.36 |
| JCDecaux MIDDLE EAST FZ-LLC | United Arab Emirates |
100.00 | F | 100.00 | |
| JCDecaux OUT OF HOME FZ-LLC (ABU DHABI) | United Arab Emirates |
55.00 | F | 55.00 | |
| JCDecaux AIRPORT, Inc. | United States | 100.00 | F | 100.00 | |
| MIAMI AIRPORT CONCESSION, LLC | United States | 50.00 | E* | 50.00 | |
| JCDecaux AIRPORT CHICAGO, LLC | United States | 100.00 | F | 100.00 | |
| THE JOINT VENTURE FOR THE OPERATION OF THE ADVERTISING CONCESSION AT HOUSTON AIRPORTS, LLC |
United States | 99.00 | F | 99.00 | |
| JCDecaux AIRPORT BOSTON, LLC | United States | 100.00 | F | 100.00 | |
| JCDecaux AIRPORT DALLAS FORT WORTH, LLC | United States | 97.50 | F | 97.50 | |
| IGPDECAUX Spa | (1) & (13) | Italy | 60.00 | E* | 60.00 |
| JCDecaux NORGE AS | (1) | Norw ay | 97.69 | F | 100.00 |
| CITY BUS TOP, S.A. | Panama | 60.93 | F | 80.00 | |
| PUBLICIDAD AEROPUERTO DE TOCUMEN S.A. | Panama | 76.16 | F | 100.00 | |
| JCDecaux PARAGUAY SA | Paraguay | 70.00 | F | 70.00 | |
| JCDecaux PERU SAC | (1) | Peru | 100.00 | F | 100.00 |
| JCDecaux AIRPORT POLSKA Sp zoo | Poland | 100.00 | F | 100.00 | |
| JCDecaux AIRPORT PORTUGAL SA | Portugal | 85.00 | F | 85.00 | |
| RENCAR PRAHA AS | Czech Rep. | 46.90 | F | 70.00 | |
| JCDecaux ASIA SINGAPORE Pte Ltd | Singapore | 100.00 | F | 100.00 | |
| JCDecaux OUT OF HOME ADVERTISING Pte Ltd | Singapore | 100.00 | F | 100.00 | |
| JCDecaux THAILAND Co., Ltd | Thailand | 98.00 | F | 49.50 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| BILLBOARD | |||||
| JCDecaux SOUTH AFRICA HOLDINGS (PROPRIETARY) LIMITED |
South Africa | 100.00 | F | 100.00 | |
| JCDecaux SOUTH AFRICA OUTDOOR ADVERTISING (PROPRIETARY) LIMITED |
South Africa | 49.00 | F | 70.00 | |
| JCDecaux SUB-SAHARAN AFRICA (Pty) Ltd | South Africa | 78.15 | F | 100.00 | |
| MERAFE RAIL | South Africa | 78.15 | F | 100.00 | |
| MERAFE OUTDOOR | South Africa | 78.15 | F | 100.00 | |
| CORPCOM OUTDOOR | South Africa | 78.15 | F | 100.00 | |
| SUBURBAN INDUSTRIAL SIGN DESIGN | South Africa | 78.15 | F | 100.00 | |
| RENT A SIGN LEBOWA | South Africa | 39.08 | E* | 50.00 | |
| JCDecaux SOUTH AFRICA (PTY) Ltd | South Africa | 70.00 | F | 100.00 | |
| OUTDOOR Co (Pty) Ltd | South Africa | 70.00 | F | 100.00 | |
| BDEYE DESIGNS (Pty) Ltd | South Africa | 70.00 | F | 100.00 | |
| KCF INVESTMENTS (Pty) Ltd | South Africa | 70.00 | F | 100.00 | |
| NEWSHELF1001 (Pty) Ltd (Lease Co) | South Africa | 70.00 | F | 100.00 | |
| SIYENZA GRAPHIC DESIGN AND SIGNAGE (PTY) LTD | South Africa | 70.00 | F | 100.00 | |
| INTER-AFRICA OUTDOOR ADVERTISING (SOUTH AFRICA) (PTY) Ltd |
South Africa | 78.15 | F | 100.00 | |
| JCDecaux SUBSAHARAN AFRICA HOLDINGS (Pty) Ltd | South Africa | 70.00 | F | 100.00 | |
| JINJA 3 OUTDOOR ADVERTISING PTY LTD | South Africa | 21.00 | E* | 30.00 | |
| JCDecaux ANGOLA LIMITADA | Angola | 78.15 | F | 100.00 | |
| JCDecaux ARGENTINA OOH S.A. | Argentina | 100.00 | F | 100.00 | |
| JCDecaux ANZ PTY Ltd | Australia | 100.00 | F | 100.00 | |
| JCDecaux AUSTRALIA HOLDINGS PTY Ltd | Australia | 100.00 | F | 100.00 | |
| APN OUTDOOR GROUP PTY LTD | Australia | 100.00 | F | 100.00 | |
| APNO GROUP HOLDINGS PTY LTD | Australia | 100.00 | F | 100.00 | |
| APNO FINANCE PTY LTD | Australia | 100.00 | F | 100.00 | |
| JCDecaux AUSTRALIA TRADING PTY LTD | (1) | Australia | 100.00 | F | 100.00 |
| APN OUTDOOR PTY LTD | Australia | 100.00 | F | 100.00 | |
| AUSTRALIAN POSTERS PTY LTD | Australia | 100.00 | F | 100.00 | |
| ADSPACE PTY LTD | Australia | 100.00 | F | 100.00 | |
| IOM PTY LIMITED | Australia | 100.00 | F | 100.00 | |
| GEWISTA WERBEGESELLSCHAFT.mbH | (1) | Austria | 67.00 | F | 67.00 |
| PROGRESS AUSSENWERBUNG GmbH | Austria | 45.10 | F | 51.00 | |
| PROGRESS WERBELAND WERBE. GmbH | (20) | Austria | 67.00 | F | 100.00 |
| USP WERBEGESELLSCHAFT.mbH | Austria | 52.30 | F | 79.00 | |
| JCDecaux CENTRAL EASTERN EUROPE GmbH | Austria | 100.00 | F | 100.00 | |
| GEWISTA SERVICE GmbH | Austria | 67.00 | F | 100.00 | |
| ROLLING BOARD OBERÖSTERREICH WERBE GmbH | Austria | 33.50 | E* | 50.00 | |
| KULTURFORMAT | Austria | 67.00 | F | 100.00 | |
| MEGABOARD SORAVIA GmbH | Austria | 45.10 | F | 51.00 | |
| ANKÜNDER GmbH | Austria | 22.31 | E | 33.30 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| ATSBG Holding GmbH | (3) | Austria | 85.15 | F | 100.00 |
| JCDecaux BILLBOARD BELGIUM | Belgium | 86.93 | F | 100.00 | |
| JCDecaux ARTV ERTISING BELGIUM | Belgium | 100.00 | F | 100.00 | |
| CS CONSULTING BVBA | Belgium | 86.93 | F | 86.93 | |
| PUBLIROUTE NV | Belgium | 86.93 | F | 100.00 | |
| CITY BUSINESS MEDIA | Belgium | 100.00 | F | 100.00 | |
| JCDecaux BOTSWANA (PTY) LIMITED | Botsw ana | 78.15 | F | 100.00 | |
| JCDecaux GRANDES FORMATOS MIDIA EXTERIOR LTDA |
Brazil | 100.00 | F | 100.00 | |
| JCDecaux OUTDOOR Ltda | Brazil | 100.00 | F | 100.00 | |
| JCDecaux BULGARIA HOLDING BV | (8) | Bulgaria | 50.00 | E* | 50.00 |
| JCDecaux BULGARIA EOOD | Bulgaria | 50.00 | E, | 50.00 | |
| MARKANY LINE EOOD | Bulgaria | 25.00 | $E^*$ | 50.00 | |
| EASY DOCK EOOD | Bulgaria | 50.00 | E, | 50.00 | |
| PRIME OUTDOOR OOD | Bulgaria | 50.00 | $E^*$ | 50.00 | |
| JCDecaux IMAGE JSC | Bulgaria | 25.00 | E* | 50.00 | |
| IOAHC INVESTMENTS URUGUAY COMPANY | Cayman Islands |
100.00 | F | 100.00 | |
| IOA PROLIX COMPANY | Cayman Islands |
80.00 | $\mathsf F$ | 80.00 | |
| JCDecaux OOH CHILE Sp.A. (previously JCDecaux OOH CHILE SA) |
Chile | 100.00 | F | 100.00 | |
| POAD | China | 49.00 | Е | 49.00 | |
| EUROPLAKAT Doo | Croatia | 45.10 | F | 51.00 | |
| JCDecaux ESWATINI (PROPRIETARY) LIMITED | Esw atini | 78.15 | F | 100.00 | |
| JCDecaux Chicago Communication Netw ork, LLC | (18) | United States | 100.00 | F | 100.00 |
| (previously INTERSTATE JCDecaux LLC) | |||||
| JCDecaux TOP MEDIA HONDURAS S.A. | Honduras | 76.16 | F | 100.00 | |
| JCDecaux REUNION ISLAND | Reunion Island | 62.13 | F | 100.00 | |
| DAVID ALLEN HOLDINGS Ltd | (7) | Ireland | 100.00 | F | 100.00 |
| DAVID ALLEN POSTER SITES Ltd | Ireland | 100.00 | F | 100.00 | |
| SOLAR HOLDINGS Ltd | Ireland | 100.00 | F | 100.00 | |
| JCDecaux IRELAND Ltd | (1) | Ireland | 100.00 | F | 100.00 |
| BRAVO OUTDOOR ADVERTISING Ltd | Ireland | 100.00 | F | 100.00 | |
| I-MAGO FIRENZE Spa | (2) | Italy | 60.00 | E, | 60.00 |
| JCDecaux LESOTHO (PTY) LTD | Lesotho | 78.15 | F | 100.00 | |
| JCDecaux MADAGASCAR SA | Madagascar | 62.52 | F | 80.00 | |
| JCDecaux OUTDOOR ADVERTISING LTD | Malaw i | 78.15 | F | 100.00 | |
| JCDecaux (MAURITIUS) Ltd | Mauritius | 62.13 | F | 79.50 | |
| CONTINENTAL OUTDOOR MEDIA MANAGEMENT COMPANY (MAURITIUS) Ltd |
Mauritius | 78.15 | F | 100.00 | |
| VENDOR PUBLICIDAD EXTERIOR S DE R.L. DE C.V. | Mexico | 60.00 | F | 100.00 | |
| CORPORACION DE MEDIOS INTEGRALES, S.A. DE C.V. |
Mexico | 60.00 | F | 100.00 | |
| PUBLITOP, S.A. DE C.V. | Mexico | 60.00 | F | 100.00 | |
| JCDecaux MOZAMBIQUE LDA | Mozambique | 55.88 | F | 71.50 | |
| JCDecaux NAMIBIA OUTDOOR ADVERTISING (Pty) Limited |
Namibia | 78.15 | F | 100.00 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| JCDecaux TOP MEDIA NICARAGUA SA. | Nicaragua | 76.16 | F | 100.00 | |
| JCDecaux NIGERIA OUTDOOR ADVERTISING Ltd | Nigeria | 54.71 | F | 70.00 | |
| JCDecaux NEW ZEALAND HOLDINGS LIMITED | New Zealand |
100.00 | F | 100.00 | |
| JCecaux NEW ZEALAND TRADING LIMITED | (1) | New Zealand |
100.00 | F | 100.00 |
| JCDecaux TOP MEDIA SERVICIOS DE PANAMA, S.A. | Panama | 76.16 | F | 100.00 | |
| TOP MEDIA PANAMA, S.A. | Panama | 76.16 | F | 100.00 | |
| PUBLITOP DE PANAMA, S.A. | Panama | 76.16 | F | 100.00 | |
| JCDecaux NEONLIGHT Sp zoo | Poland | 100.00 | F | 100.00 | |
| GIGABOARD POLSKA Sp zoo Poland | Poland | 67.00 | F | 100.00 | |
| RED PORTUGUESA - PUBLICIDADE EXTERIOR SA |
(14) | Portugal | 100.00 | F | 100.00 |
| RED LITORAL - PUBLICIDADE EXTERIOR Lda | (2) | Portugal | 72.47 | F | 75.00 |
| DISTRIBUIDORA DE VALLAS DOMINICANA, S.A. | Dominican Rep. | 100.00 | F | 100.00 | |
| EUROPLAKAT Spol Sro | Czech Rep. | 67.00 | F | 100.00 | |
| JCDecaux Ltd | United Kingdom | 100.00 | F | 100.00 | |
| JCDecaux UNITED Ltd | United Kingdom | 100.00 | F | 100.00 | |
| ALLAM GROUP Ltd | United Kingdom | 100.00 | F | 100.00 | |
| EXCEL OUTDOOR MEDIA Ltd | United Kingdom | 100.00 | F | 100.00 | |
| TOP MEDIA EL SALVADOR, S.A. de C.V. | Salvador | 76.16 | F | 100.00 | |
| ISPA BRATISLAVA Spol Sro | Slovakia | 67.00 | F | 100.00 | |
| EUROPLAKAT Doo | Slovenia | 27.56 | E* | 41.13 | |
| PLAKATIRANJE Doo | Slovenia | 27.56 | E* | 41.13 | |
| SVETLOBNE VITRINE | Slovenia | 27.56 | E* | 41.13 | |
| MADISON Doo | Slovenia | 27.56 | E* | 41.13 | |
| METROPOLIS MEDIA Doo (SLOVENIA) | Slovenia | 27.56 | E* | 41.13 | |
| APG SGA SA | Sw itzerland |
30.00 | E | 30.00 | |
| JCDecaux TANZANIA LTD | Tanzania | 78.15 | F | 100.00 | |
| BIGBOARD B.V. | (9) | Ukraine | 50.00 | E* | 50.00 |
| ALTER-V LLC | Ukraine | 50.00 | E* | 50.00 | |
| BIG MEDIA LLC | Ukraine | 50.00 | E* | 50.00 | |
| BIGBOARD KHARKOV | Ukraine | 50.00 | E* | 50.00 | |
| BIGBOARD LLC (KIEV) | Ukraine | 50.00 | E* | 50.00 | |
| BIGBOARD LVOV | Ukraine | 50.00 | E* | 50.00 | |
| BIGBOARD VYSHGOROD | Ukraine | 50.00 | E* | 50.00 | |
| BIGBOARD ZAPOROZHIE | Ukraine | 50.00 | E* | 50.00 | |
| BOMOND LLC | Ukraine | 25.00 | E* | 50.00 | |
| MEDIA PARTNER - O | (2) | Ukraine | 50.00 | E* | 50.00 |
| OUTDOORAUTO LLC | Ukraine | 50.00 | E* | 50.00 | |
| POSTER DNEPROPETROVSK | Ukraine | 50.00 | E* | 50.00 | |
| POSTER DONBASS | Ukraine | 50.00 | E* | 50.00 | |
| POSTER LLC (KIEV) | Ukraine | 50.00 | E* | 50.00 |
| COMPANIES | COUNTRY | % INTEREST | CONSOL. METHOD |
% CONTROL* |
|
|---|---|---|---|---|---|
| POSTER ODESSA | (2) | Ukraine | 50.00 | E* | 50.00 |
| REKSVIT UKRAINE LLC | Ukraine | 50.00 | E* | 50.00 | |
| JCDecaux ZAMBIA LTD | Zambia | 78.15 | F | 100.00 | |
| JCDecaux ZIMBABWE (PVT) LTD | Zimbabw e |
78.15 | F | 100.00 | |
Note:
F = Full consolidation
E* = Under the equity method (joint control)
E = Under the equity method (significant influence)
* The percentage of control corresponds to the portion of direct or indirect ownership in the share capital of the companies except for the companies held by a company under joint control and under significant influence. For these companies, the percentage of control corresponds to the percentage of control of its owner.
For controlled companies and companies they hold under the equity method, the voting rights percentage is normally determined based on the percentage of control, with the exception of a few companies in China, where it is determined by representation on governance bodies, given that local legal and regulatory specificities do not allow it to be assessed otherwise, and Thailand, where the voting rights percentage is 98%.
On 8 March 2023, the Supervisory Board decided to propose to not distribute any dividend for 2022 at the General Meeting in May 2023.
On 11 January 2023, the Group announced that it has issued 600 million euros of 6-year bonds maturing in January 2029. The proceeds of this issue will be used for general corporate purposes and to refinance existing debts.
Département de KPMG S.A. Tour Eqho 2, avenue Gambetta CS 60055 92066 Paris-La Défense cedex S.A. au capital de € 5 497 100 775 726 417 R.C.S. Nanterre
Commissaire aux Comptes Membre de la compagnie régionale de Versailles et du Centre
Tour First TSA 14444 92037 Paris-La Défense cedex S.A.S. à capital variable 438 476 913 R.C.S. Nanterre
Commissaire aux Comptes Membre de la compagnie régionale de Versailles et du Centre
JCDecaux SE (Formerly JCDecaux SA) Year ended December 31, 2022
To the Annual General Meeting of JCDecaux SE,
In compliance with the engagement entrusted to us by your Annual General Meeting, we have audited the accompanying consolidated financial statements of JCDecaux SE for the year ended December 31, 2022.
In our opinion, the consolidated financial statements give a true and fair view of the assets and liabilities and of the financial position of the Group as at December 31, 2022 and of the results of its operations for the year then ended in accordance with International Financial Reporting Standards as adopted by the European Union.
The audit opinion expressed above is consistent with our report to the Audit Committee.
We conducted our audit in accordance with professional standards applicable in France. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Statutory Auditors' Responsibilities for the Audit of the Consolidated Financial Statements section of our report.
We conducted our audit engagement in compliance with the independence requirements of the French Commercial Code (Code de commerce) and the French Code of Ethics for Statutory Auditors (Code de déontologie de la profession de commissaire aux comptes) for the period from January 1, 2022 to the date of our report, and specifically we did not provide any prohibited non-audit services referred to in Article 5(1) of Regulation (EU) No. 537/2014.
In accordance with the requirements of Articles L. 823-9 and R. 823-7 of the French Commercial Code (Code de commerce) relating to the justification of our assessments, we inform you of the key audit matters relating to risks of material misstatement that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period, as well as how we addressed those risks.
These matters were addressed in the context of our audit of the consolidated financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on specific items of the consolidated financial statements.
| Risk identified | Your Group has applied IFRS 16 "Leases" January 1, 2019, whereby lessees use the same recognition model for all leases with the recognition of a right-of-use asset and a lease liability. Under this standard, a contract is a lease, or contains a lease component, if it grants the right to the lessee to control the use of an identified asset (mainly advertising space in the case of your Group) for a period of time in exchange for payment. Contracts providing for substantive rights of substitution of advertising space by the lessor are excluded from the standard. |
|||
|---|---|---|---|---|
| The conditions of application of IFRS 16 are described in Note "Leases" to the consolidated financial statements. Thus, as at December 31, 2022, the right-of-use assets in your company's consolidated financial statements amount to € 2,725.3m. Your Group opted for the application of the amendment to IFRS 16 published by the European Union on October 9, 2020 and on August 30, 2021, which specifies the methods of accounting for the COVID-19-related rent concessions granted by lessors within the context of the COVID-19 crisis until 30 June 30, 2022. No new amendments have been approved for periods after June 30, 2022 and any rent relief is now to be analyzed in accordance with the initial standard. |
||||
| We considered the accounting treatment of leases to be a key audit matter due to the number and importance of these contracts for your Group, the significant impact of this standard on the consolidated financial statements, the accounting methods applied and the high level of judgment required by your Group's Management to determine the assumptions adopted (the substantive nature of the lessors' rights of substitution, the effective term of the leases including their tacit renewal, and the determination of funding rates). |
||||
| As part of our audit of the consolidated financial statements, our work notably consisted in: ► familiarizing ourselves with the procedures set up by your Group to identify and account for leases; |
||||
| Our response | ► assessing the relevance of the methods used to determine the main assumptions underlying the determination of the right-of-use assets and the lease liabilities; |
|||
| ► assessing the relevance of the analyses performed by your Group on the substantive nature of the rights of substitution granted to lessors; |
||||
| ► assessing the correct application of IFRS 16 and its amendments; |
| ► testing the reliability of the information system dedicated to the management of the leases concerned by the application of IFRS 16 with the assistance of our experts; |
|---|
| ► comparing, through sampling: |
| ► the data entered in the information system to determine the assets and liabilities relating to leases, based on the underlying contractual documents; |
| ► the criteria taken into account by Management to determine the effective rental period used for tacit renewal contracts and the contracts including termination and renewal options; |
| ► the data used to determine the financing rates with the market data; |
| ► assessing the appropriateness of the disclosures in the notes to the consolidated financial statements. |
| As at December 31, 2022, the net carrying amount of goodwill, other tangible and intangible |
|---|
| assets, right-of-use assets and equity-accounted investments amounted to € 6,788.9m. |
Your Group performs impairment tests at the level of the cash-generating units (CGUs) corresponding to the operating entities for tangible and intangible assets and equity-accounted investments, and at the level of each group of CGUs the scope of which is determined either at the level where the operating segments and the geographical area meet, or based on specific CGU groups (Airports sector, Pacific and France Roadside areas) for goodwill.
Risk identified The impairment testing methods used by your Group are described in Notes 1.10 and 1.12 to the consolidated financial statements.
These impairment tests constitute a key audit matter due to the importance of the assets concerned in the consolidated financial statements and the estimates and judgments required for their valuation. They use forecast data specific to each operating segment to determine the recoverable amount. These data includes management's view of the profitability outlook and assumptions as described in note 1.10 "Impairment of intangible assets, property, plant and equipment, right-of-use and goodwill" in the notes to the consolidated financial statements.
Our audit procedures notably consisted in:
Our response
► and by comparison with the data used for previous impairment tests as well as the historical performance of the subsidiaries concerned;
► assessing the reasonableness of the discount rate, long-term growth rate and renewal rate of the contracts;
We have also performed, in accordance with professional standards applicable in France, the specific verifications required by French laws and regulations of the information given in the Executive Board's Group management report.
We have no matters to report as to its fair presentation and its consistency with the consolidated financial statements
We attest that the consolidated non-financial statement provided for by Article L. 225-102-1 of the French Commercial Code (Code de commerce) is included in the group management report, it being specified that, in accordance with the provisions of Article L. 823-10 of said Code, we have verified neither the fair presentation nor the consistency with the financial statements of the information contained in this statement. This information should be the subject of a report by an independent third party.
We have also verified, in accordance with the professional standard applicable in France relating to the procedures performed by statutory auditors regarding the annual and consolidated financial statements prepared in the European single electronic format, that the preparation of the consolidated financial statements intended to be included in the annual financial report mentioned in Article L. 451-1-2, I of the French Monetary and Financial Code (Code monétaire et financier), prepared under the responsibility of the Chairman of the Executive Board, complies with the single electronic format defined in Commission Delegated Regulation (EU) No. 2019/815 of 17 December 2018. Regarding consolidated financial statements, our work includes verifying that the tagging thereof complies with the format defined in the above-mentioned regulation.
On the basis of our work, we conclude that the preparation of the consolidated financial statements intended to be included in the annual financial report complies, in all material respects, with the European single electronic format.
Due to the technical limitations inherent to the block-tagging of the consolidated financial statements according to the European single electronic format, the content of certain tags of the notes may not be rendered identically to the accompanying consolidated financial statements.
We have no responsibility to verify that the consolidated financial statements that will ultimately be included by your Company in the annual financial report filed with the AMF (Autorité des marchés financiers) agree with those on which we have performed our work.
We were appointed as statutory auditors of JCDecaux SE by the Annual General Meeting held on May 10, 2006 for KPMG Audit, Département de KPMG S.A. and on June 20, 2000 for ERNST & YOUNG et Autres.
As at 31 December 2022, KPMG Audit, Département de KPMG S.A. was in its seventeenth year of total uninterrupted engagement and ERNST & YOUNG et Autres in its twenty-third year of total uninterrupted engagement, including twenty-two years since the securities of the Company were admitted to trading on a regulated market.
Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the European Union and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless it is expected to liquidate the Company or to cease operations.
The Audit Committee is responsible for monitoring the financial reporting process and the effectiveness of internal control and risks management systems and where applicable, its internal audit, regarding the accounting and financial reporting procedures.
The consolidated financial statements were approved by the Executive Board.
Our role is to issue a report on the consolidated financial statements. Our objective is to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with professional standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As specified in Article L. 823-10-1 of the French Commercial Code (Code de commerce), our statutory audit does not include assurance on the viability of the Company or the quality of management of the affairs of the Company.
As part of an audit conducted in accordance with professional standards applicable in France, the statutory auditor exercises professional judgment throughout the audit and furthermore:
We submit to the Audit Committee a report which includes in particular a description of the scope of the audit and the audit program implemented, as well as the results of our audit. We also report significant deficiencies, if any, in internal control regarding the accounting and financial reporting procedures that we have identified.
Our report to the Audit Committee includes the risks of material misstatement that, in our professional judgment, were of most significance in the audit of the consolidated financial statements of the current period and which are therefore the key audit matters that we are required to describe in this report.
We also provide the Audit Committee with the declaration provided for in Article 6 of Regulation (EU) No. 537/2014, confirming our independence within the meaning of the rules applicable in France as set out in particular in Articles L. 822-10 to L. 822-14 of the French Commercial Code (Code de commerce) and in the French Code of Ethics for Statutory Auditors (Code de déontologie de la profession de commissaire aux comptes). Where appropriate, we discuss with the Audit Committee the risks that may reasonably be thought to bear on our independence, and the related safeguards.
Paris-La-Défense, March 15, 2023
The Statutory Auditors
French original signed by
KPMG Audit Département de KPMG S.A. ERNST & YOUNG et Autres
Grégoire Menou Aymeric de La Morandière
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