Compagnie Générale des Etablissements Michelin

Investor Presentation • Jul 26, 2021

Motion for Life

First-half 2021 financial report

01	PRESS INFORMATION	3
	Press release	4
02	SLIDESHOW	13
	Introduction	15
	First-half 2021 results	17
	2021 Guidance	26
	Appendices Capital Markets Day / key messages	30 48
03	2021 FIRST-HALF BUSINESS REVIEW	74
	3.1 Tire markets	76
	3.2 Sales	82
	3.3 Consolidated income statement review	87
	3.4 Consolidated balance sheet review	93
	3.5 Consolidated cash flow statement review	98
	3.6 Outlook for 2021	99
	3.7 Related parties	99
	3.8 Risk management	99
	3.9 Key figures	100
	3.10 Share information	101
	3.11 Highlights	103
04	CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS	107
	Condensed interim consolidated financial statements – Six months ended June 30, 2021	108
05	STATUTORY AUDITORS' REVIEW REPORT	135
	Statutory Auditors' review report on the interim financial information	136

06 STATEMENT BY THE PERSON RESPONSIBLE 137

Statement by the person responsible for the first-half 2021 financial report 138

PRESS RELEASE	4
Market review	5
First-Half 2021 Net Sales and Earnings	7
"All Sustainable" Michelin – First-Half 2021	8
First-Half 2021 Highlights	9

PRESS RELEASE

Clermont-Ferrand, July 26,2021

COMPAGNIE GÉNÉRALE DES ÉTABLISSEMENTS MICHELIN Financial information for the six months ended June 30, 2021

First-half 2021: The Michelin Group reports sales of €11.2 billion – up 19.6% – and segment operating income of €1.4 billion, representing 12.7% of sales. The Group raises its full-year guidance.

• ► In an environment shaped by an enduring health crisis, the robust market recovery was tempered by major disruptions in the global supply chain.
• ► In this context, the commitment of Michelin teams helped to deliver a 19.6% increase in sales and €1,421 million in segment operating income for the period, with:
• a 22.8% increase in tire volumes, adding €1,195 million to SOI(1) and reflecting market share gains in every segment, especially 18-inch and larger tires, and a 4.6% increase in sales of non-tire activities;
• a €126 million increase from the positive net price-mix/raw materials effect. The 1.4% gain from responsive pricing management helped to offset the rise in raw material procurement costs. In addition, the mix effect added 1% to growth, thanks to the steady enhancement in the product mix and a favorable market mix;
• an unfavorable currency effect, stemming primarily from the US dollar's weakness against the euro, which reduced SOI by €150 million.
• ► Free cash flow before acquisitions totaled a positive €361 million, lifted by the growth in EBITDA and the still lower than normal inventory levels.
• ► Debt remained unchanged for the period while equity increased, driving an improvement in the Group's gearing to 26.7%.

Florent Menegaux, CEO, said: "As markets continued to recover, the Michelin Group had a very good first half. These solid results should not overshadow the persistent impact of the health crisis, which is causing major disruptions, particularly in the supply chain. I would therefore like to personally thank the Michelin teams for their unwavering commitment to enabling our Group to sustain its leadership in our tire businesses and to continue deploying our sustainable growth strategy."

► Outlook for 2021:

After recovering sharply in the first half, global demand will not benefit from as favorable a base in the second half of the year, when it will likely continue to be impacted by global supply chain disruptions. Passenger car and Light truck tire markets are expected to expand by between 8% and 10% over the year and Truck tire markets by between 6% and 8%. The Specialty markets should deliver 10% to 12% growth over the year.

Barring any new systemic effect from Covid-19 (2), Michelin plans to strengthen its positions in the prevailing market environment. Consequently, the Group is raising its objectives for the full year, targeting segment operating income in excess of €2.8 billion at constant exchange rates (versus > €2.5 billion as previously announced) and structural free cash flow (3) of more than €1 billion (versus around €1 billion).

(in € millions)	First-half 2021	First-half 2020
Sales	11,192	9,357
Segment operating income	1,421	310
Segment operating margin	12.7%	3.3%
Automotive and related distribution	13.1%	-0.8%
Road transportation and related distribution	9.9%	-1.3%
Specialty businesses and related distribution	14.8%	14.7%
Other operating income and expenses	16	(133)
Operating income	1,437	177
Net income/(loss)	1,032	(137)
Earnings per share	5.74	(0.75)
Segment EBITDA	2,277	1,192
Capital expenditure	543	490
Net debt	3,679	5,510
Gearing	26.7%	45%
Provisions for post-employment benefit obligations	3,408	3,858
Free cash flow*	346	(351)
Free cash flow before acquisitions	361	(310)
Employees on payroll**	123,686	124,000

* Free cash flow: net cash from operating activities less net cash used in investing activities, adjusted for net cash flows relating to cash management financial assets and borrowing collaterals.

** At period-end.

(2) Deeper supply chain disruptions or tighter restrictions on freedom of movement that would result in a significant drop in the tire markets.

(3) Structural free cash flow corresponds to free cash flow before acquisitions, adjusted for the impact of changes in raw material prices on trade payables, trade receivables and inventories.

⁽¹⁾ SOI: Segment Operating Income.

MARKET REVIEW

Passenger car and Light truck tire markets

First-half 2021/2020 (in number of tires)	Western & Central Europe*	CIS	North & Central America	South America	China	Asia (excluding India & China)	Africa/ India/ Middle East	Total
Original Equipment	+26%	+38%	+36%	+57%	+22%	+17%	+48%	+27%
Replacement	+22%	+19%	+37%	+40%	+15%	+12%	+27%	+25%
	Western &		North &			Asia
Second-quarter 2021/2020 (in number of tires)	Central Europe*	CIS	Central America	South America	China	(excluding India & China)	Africa/ India/ Middle East	Total
Original Equipment	+93%	+80%	+146%	+282%	-8%	+50%	+132%	+46%
Replacement	+45%	+52%	+74%	+89%	-2%	+21%	+81%	+46%

* Including Turkey

In the first half of 2021, the global Original Equipment and Replacement Passenger car and Light truck tire market rebounded by 26% in number of tires sold.

Original Equipment

Worldwide unit sales of Original Equipment tires rebounded by 27% in the first half of 2021. However, this sharp market upturn from the low 2020 base was dampened by the impact of semiconductor shortages on the global automotive industry, such that OE demand ended the period still down 14% compared with first-half 2019.

After a first quarter shaped by a 78% upsurge in Chinese demand off of favorable prior-year comparatives, the second three months saw the European and North American markets increase sharply, for the same reasons, by 93% and 146% respectively. In China, however, supply chain issues caused demand to contract by 8% over the quarter.

The other regions (South America, Africa/India/Middle East and Southeast Asia) also enjoyed, as expected, a strong recovery in the second quarter.

Replacement

The global Replacement market rebounded by 25% in the first half, with a faster 46% gain in the second quarter from much more favorable comparatives in Europe and the Americas, at a time of sustained recovery in mobility and buying ahead of price increases.

► In Western and Central Europe, growth was stronger in the Southern countries, which had experienced stricter lockdowns in first-half 2020, with demand rising 30% in France, 51% in Spain and 28% in Italy, countries where restrictions on freedom of movement remained in place until May 2021. Several dealers replenished their inventories ahead of rising prices. In all, European tire demand ended the period down slightly on 2019 levels.

• ► Tire demand in North and Central America rose a steep 37% in the first half, with a faster 74% gain in the second quarter led by very favorable comparatives and the partial rebuilding of dealer inventories. By the end of June, the Replacement market had climbed back above 2019 levels.
• ► In South America, Replacement demand ended the first half up 40% year on year, with an 89% increase in the second quarter and particularly strong growth in Brazil. By periodend, the South American market had made up all of the shortfall since first-half 2019.
• ► In China, after a particularly strong first quarter (up 38% on highly favorable comparatives and inventory rebuilding), demand was down a slight 2% year-on-year in the second three months, reflecting the return to normal market conditions in the prior-year period.
• ► In Southeast Asia, Replacement demand rose by 12% over the first half, with a faster 21% gain in the second quarter. In 2020, the market drop had not been as steep as in the other regions. As of end-June 2021, demand was still below 2019 levels.
• ► In the Africa/India/Middle East region, markets rebounded by 27% in the first half, with an 81% increase in the second quarter led by the strong recovery in demand in India (up 225%) and North Africa (up 87%). Replacement demand, however, remained significantly below 2019 levels.

Truck tire markets (radial and bias)

First-half 2021/2020 (in number of tires)	Western & Central Europe*	CIS	North & Central America	South America	China	Asia (excluding India & China)	Africa/ India/ Middle East	Total
Original Equipment	+50%	+16%	+46%	+55%	+23%	+15%	+44%	+29%
Replacement	+27%	-5%	+35%	+29%	+28%	+9%	+16%	+22%
Second-quarter 2021/2020 (in number of tires)	Western & Central Europe*	CIS	North & Central America	South America	China	Asia (excluding India & China)	Africa/ India/ Middle East	Total
Original Equipment	+98%	+19%	+119%	+117%	-11%	+45%	+127%	+12%
Replacement	+38%	+2%	+56%	+47%	+4%	+19%	+34%	+26%

* Including Turkey

The number of new Truck tires sold worldwide climbed a sharp 24% in the first half of 2021, lifted by the global economic recovery and the resulting upturn in freight demand.

Original Equipment

The global Original Equipment Truck tire market, as measured by the number of new tires sold, grew by 29% in the first half of 2021.

The first quarter delivered growth of 50%, impelled by the 88% increase in Chinese demand ahead of implementation of the China 6 emission standards.

Growth slowed to 12% in the second three months, reflecting:

• ► an 11% decline in China, as trucking companies completed their fleet upgrades;
• ► strong growth in the other regions, off of very favorable comparatives and in sharply rebounding economies.

Global OE demand rose significantly above first-half 2019 levels in first-half 2021, led by the brisk growth in China, but remained below them in the European and US markets.

Replacement

Demand for Replacement Truck tires rose by 22% over the first half, with a faster 26% gain in the second quarter.

Specialty business markets

• ► Mining tires: After getting off to a slow start in the first quarter, the surface mining tire market is showing signs of fresh momentum pointing to sustained demand in the second half.
• ► Agricultural and Construction tires: The cyclical rebound is continuing apace, particularly in Original Equipment Agricultural, Construction and Materials Handling tires.

• ► Two-wheel tires: Demand remains high in every segment. These personal means of transportation, which still offer a more sanitary alternative to public transport, are structurally well suited to city travel, with demand being driven both by the sustainable image of bicycles and the surging popularity of recreational activities.

• ► In Western and Central Europe, in an environment shaped by very favorable economic conditions but also impacted by inventory rebuilding, the Replacement market expanded by 27%, led by very high demand in the Southern countries (up 48% in the Iberian Peninsula, 49% in Italy and 31% in France). As a result, the market ended the period above its 2019 levels.

• ► In North and Central America, the Replacement market climbed 35% over the first six months, with a faster 56% increase in the second quarter. Impelled by the economic upturn in the region, this surge in growth lifted the market well above its pre-crisis levels by the end of June.
• ► In South America, the Replacement market ended the period up 29%, as the 38% economic recovery-led gain in Brazil more than offset the 11% decline in Argentina. Demand now exceeds 2019 levels.
• ► Demand in Southeast Asia increased by 9% in the first half, with a sharp acceleration to 19% in the second quarter. Growth varied widely by country, from 18% in Thailand and 12% in Indonesia to 7% in Japan and South Korea, and 3% in Australia. The market remains significantly below its precrisis levels.
• ► Replacement demand in the Africa/India/Middle East region rose by 16%, led by a 27% increase in India, but remained lower than in 2019.
• ► Aircraft tires: Demand for commercial aircraft tires is flat in Europe, but has recovered in the Americas and China, particularly from low-cost airlines.
• ► Conveyor belts: The mining conveyor belt market turned in a mixed performance, with demand stabilizing in Australia due to sustained Chinese restrictions on Australian ore imports while demand continued to expand in the services and engineering segments. In North America, order intake was pretty low compared to the recovery in the coal market and improving conditions in the manufacturing industry.
• ► Specialty polymers: Markets as a whole are experiencing strong growth in demand, especially for precision polymers, hydraulic seals and energy seals.

FIRST-HALF 2021 NET SALES AND EARNINGS

Sales

Sales for the first six months of 2021 totaled €11,192 million, an increase of 19.6% from the year-earlier period that was attributable to the net impact of the following factors:

• ► a robust 22.8% upturn in tire volumes from favorable prioryear comparatives, as higher demand lifted by the global economic recovery and dealer inventory rebuilding overcame serious disruptions in the supply chain;
• ► the 4.6% growth in non-tire sales, as the recovery in Fenner's operations and the gains in fleet management services were dampened by the extremely weak sales in the fine dining and travel segments due to the health crisis;
• ► the positive 2.4% price-mix effect (0.9% in the first quarter and 4.5% in the second). The €133 million positive price effect resulted from the Group's firm pricing discipline, with the rapid rollout of price increases to offset rising raw materials and logistics costs. The €96 million positive mix effect reflected (i) the sustained success of the MICHELIN brand's premium strategy, notably in the 18-inch and larger segment; and (ii) the favorable impact of the relative performances of (a) Replacement Passenger car and Light Truck tire sales and (b) Original Equipment sales, which were impacted by the semiconductor shortage. On the other hand, the mix effect was attenuated by the relative performance of the various Specialty segments, with in particular faster growth in Agricultural and Construction tires than in Mining and Aircraft tires;
• ► the deeply negative 5.9% currency effect, stemming from relative weakness of the US dollar and the decline in the Turkish lira and the Argentine peso against the euro;
• ► the lack of any impact from changes in the scope of consolidation, after the removal of the French Maps & Guides printing, publishing and marketing assets, as of February 1, and of Solesis, in June, offset the first-time consolidation of three recent acquisitions, ConVeyBelt and Technobalt in the conveyor belt business and MAV S.p.a in the precision polymer segment.

Results

Segment operating income amounted to €1,421 million or 12.7% of sales, versus €310 million and 3.3% in first-half 2020. The change in segment operating income primarily reflected:

• ► a €1,195 million increase from the strong growth in tire volumes sold and improved fixed cost absorption;
• ► a robust €229 million increase from the tire price-mix effect, led by disciplined, responsive pricing management, sustained enhancement of the product mix and a favorable business mix;
• ► a €103 million decrease from higher raw material prices and related transportation costs;
• ► a €103 million decrease from the increase in tire SG&A expenses, which were exceptionally low in first-half 2020, but which remain far lower than in first-half 2019;
• ► a €24 million decrease from the Group's manufacturing and logistics performance, as manufacturing performance gains were seriously impacted by the sharp €45 million increase in logistics costs;
• ► a €9 million improvement in segment operating income from the non-tire businesses;
• ► a €56 million gain stemming primarily from the year-on-year decline in Covid-19-related expenditure, including the cost of purchasing and producing masks and hand sanitizer;
• ► a €150 million decrease from the unfavorable currency effect.

Other operating income and expenses amounted to a net income of €16 million, corresponding to the €41 million amortization of intangible assets acquired in business combinations, the €113 million disposal gain on the Group's investment in Solesis following the sale of a stake to the Altaris fund, and restructuring costs.

In all, net income for the first half came to €1,032 million.

Net financial position

Free cash flow ended the first half at €346 million, a €697 million improvement on the year-earlier period. The increase was mainly attributable to the strong upturn in EBITDA driven by the growth in volumes, less the outlays to partially rebuild working capital. Gearing stood at 26.7% at June 30, 2021, corresponding to net debt of €3,679 million, up €148 million from December 31, 2020.

Segment information

	Sales		Segment operating income		Segment operating margin
(in € millions)	H1 2021	H1 2020	H1 2021	H1 2020	H1 2021	H1 2020
Automotive and related distribution	5,562	4,394	730	(35)	13.1%	-0.8%
Road transportation and related distribution	2,897	2,411	286	(30)	9.9%	-1.3%
Specialty businesses and related distribution	2,733	2,552	405	375	14.8%	14.7%
GROUP	11,192	9,357	1,421	310	12.7%	3.3%

Automotive and related distribution

Sales in the Automotive and related distribution segment rose by 26.6% to €5,562 million, from €4,394 million in the first six months of 2020.

Segment operating income amounted to €730 million or 13.1% of sales, versus a loss of €35 million and -0.8% in first-half 2020.

The year-on-year improvement was primarily led by (i) the solid 28% increase in volumes, which drove market share gains, particularly in the MICHELIN-branded 18-inch and larger segment; and (ii) the favorable impact of the relative performances of Replacement and OE tire sales, with the latter hit by the shortage of auto semiconductors. Responsive pricing management helped to offset the increase in raw material prices and related transportation costs. Exchange rate movements had a negative impact on the segment's operating income.

Road transportation and related distribution

Sales in the Road transportation and related distribution segment amounted to €2,897 million in the first half of 2021, a 20% increase from the €2,411 million reported for the same period in 2020.

Segment operating income totaled €286 million or 9.9% of sales, versus a loss of €30 million and -1.3% in first-half 2020.

With the upturn in global demand and a favorable geographic mix, the segment enjoyed a 24% increase in tire volumes sold over the period. The segment's selective marketing strategy and responsive pricing management helped to offset higher raw material and related transportation costs. The Services & Solutions business is stepping up the pace of growth, led by fleet management solutions. Exchange rate movements had a negative impact on the segment's operating income.

Specialty businesses and related distribution

Sales in the Specialty businesses and related distribution segment rose by 7.1% over the period, to €2,733 million from €2,552 million in first-half 2020.

Segment operating income stood at €405 million or 14.8% of sales, versus €375 million and 14.7% in first-half 2020.

From a less favorable base than the other two segments, the Specialty businesses reported a 12% increase in tire volumes, led by sales of Construction and Agricultural tires, which resulted in a negative business mix. Rigorous price management on non-indexed activities partially offset negative impact of raw material clauses in first-half; from the second half of the year, these clauses will turn favorable. The conveyor belt and high-tech materials businesses continued to expand over the period. Exchange rate movements had a negative impact on the segment's operating income.

"ALL SUSTAINABLE" MICHELIN – FIRST-HALF 2021

Diversity and inclusion: One of the ambitious objectives in the Group's "All Sustainable" strategy is to set the standard in diversity and inclusion. To track its engagement in this area, Michelin has introduced a Diversities & Inclusion Management Index (IMDI), with the goal of reaching 80/100 by 2030, compared with a base of 50/100 in 2019 and a score of 62/100 at year-end 2020.

The index will measure the Group's performance in embracing diversity and inclusion with 12 quantitative and qualitative indicators, organized into 5 categories: Gender balance, Identity, Multi-national management, Disability, and Equal opportunity.

The Michelin Global Works Council: Designed to foster open, constructive and socially responsible dialogue at the international level, the Michelin Global Works Council was set up by Michelin in 2020 with the IndustriALL Global Union. It expresses the Group's commitment to creating a new forum for discussions with employee representatives from most of its host countries, so as to facilitate greater understanding of Michelin's economic, social and environmental challenges around the world and to improve, in every host country, employee support during periods of business transformation.

The Council's first meeting, held on June 28 and 29, 2021, provided an opportunity to discuss the Group's sustainable growth vision, based on the right balance between people, profit and planet.

Vigeo Eiris non-financial rating: In 2021, MICHELIN was once again awarded the highest A1+ ESG Rating by Vigeo Eiris (Moody's), with a five-point improvement in its overall score, to 73/100. This ranked the Group at the top of the 39 companies rated in the Automobile sector. According to Vigeo Eiris, Michelin "demonstrates an advanced commitment and ability to integrate ESG factors into its strategy, operations and risk management." The Group also earned a score of 100/100 for the rating's "Environmental strategy" aspects.

Value Balancing Alliance: In late March, Michelin joined the Value Balancing Alliance (VBA), an organization of multinational companies from a variety of industries that is developing and testing a methodology capable of translating environmental and social impacts into comparable financial data.

VBA is seeking to transform the way that companies measure, assess and disclose information about the environmental, human, social and financial value that they create for society. Its goal is to provide every stakeholder with comprehensive, reliable data to improve decision-making, business management and performance assessment.

By participating in the alliance, Michelin can work with companies from a variety of industries to lay the groundwork for widespread implementation. The approach is fully in line with the Group's All Sustainable vision, based on the right balance between personal fulfillment, business and financial performance and safeguarding the planet. It will facilitate the program underway since 2020 to assess the monetary value of

FIRST-HALF 2021 HIGHLIGHTS

• ► January 6, 2021 Michelin launches a simplification and competitiveness project to support developments in its operations in France.
• ► January 18, 2021 Michelin unveils the 2021 MICHELIN Guide France and its Green Stars.
• ► February 8, 2021 MICHELIN X® Multi™ Energy™ family of regional truck tires is enhanced with two new fitments.
• ► February 9, 2021 Thanks to its CAMSO TLH 732+ tire, CAMSO is optimizing productivity for its construction industry customers.
• ► February 11, 2021 Michelin signs a letter of commitment for maritime transport with Neoline, a French shipowner relying mainly on sail propulsion. The partnership is aligned with the Group's commitment to reducing the carbon footprint of its logistics operations by 15% in absolute terms between 2018 and 2030.
• ► February 23, 2021 In 2050, MICHELIN tires will be 100% sustainable. MICHELIN is ambitiously committed to making its tires entirely from renewable, recycled, biosourced or otherwise sustainable materials by 2050, thanks to its powerful research & development capabilities, materials technology expertise and open-innovation strategy.
• ► February 24, 2021 The Coalition for the Energy of the Future, of which Michelin is a member, has announced seven projects to accelerate the energy transition in transportation and across the entire supply chain, with major milestones set to be reached in 2021.
• ► February 25, 2021 Michelin launches the MICHELIN Pilot Sport EV, the first tire in the Pilot Sport family purposeengineered for electric sports cars.
• ► March 10, 2021 Michelin launches the new MICHELIN Wild Enduro Racing Line mountain bike tire, which has already demonstrated its capabilities with championship wins in some of the world's most challenging races.
• ► March 19, 2021 Michelin partners with sennder, Europe's leading digital freight forwarder, to broaden its portfolio of fleet services that make road freight more cost-effective and less carbon intensive.

the economic, environmental and social impact of the Group's operations across the value chain.

Sustainable materials rate in tires: In June, Michelin offered a further illustration of its "All Sustainable" vision by unveiling a track tire with 46% sustainable materials content. This very high percentage was achieved by increasing the tire's natural rubber content and using recycled carbon black recovered from end-of-life tires. In this way, Michelin is showcasing its ability to incorporate an ever-higher proportion of sustainable materials into its products without compromising on their performance. This latest milestone is fully aligned with the Group's commitment to using 100% sustainable materials in all its tires by 2050.

• ► April 2021 With its two development projects underway with Safra and Stellantis, and the construction of Europe's largest hydrogen fuel cell plant in Saint-Fons, France, Symbio (a Faurecia Michelin Hydrogen Company) is helping to accelerate the transition to hydrogen mobility.
• ► April 2, 2021 BMW Group reaffirms its trust in the Michelin Group with the development of two tires specifically for the BMW M3 and M4: the MICHELIN Pilot Sport 4S and the MICHELIN Pilot Sport Cup2 Connect.
• ► April 8, 2021 At the Group's Capital Markets Day, Florent Menegaux presents Michelin in Motion, the Group's "All Sustainable" strategy for 2030, which is based on constantly seeking the right balance between People, Profit and Planet.
• ► April 15, 2021 Michelin and Altaris announce their intention to join forces to speed the growth of Solesis, a Michelin subsidiary specializing in biomaterials for the healthcare industry.
• ► April 15, 2021 ProovStation, the European leader in automated inspection, partners with Michelin to reduce the time and costs of tire inspection, thanks to MICHELIN QuickScan technology.
• ► April 23, 2021 By validating the use of Carbios' enzymatic recycling technology for PET(1) plastic waste in Michelin tires, Michelin take a major step towards developing 100% sustainable tires, one of Michelin's major goals for 2050.
• ► April 23, 2021 Harley-Davidson and Michelin pursue their long-standing collaboration with the MICHELIN Scorcher Adventure tire, custom-designed for the Harley-Davidson Pan America™ 1250 motorcycle.
• ► April 29, 2021 For the 2021 FIA World Endurance Championship campaign, Michelin launches new tire lines developed entirely virtually for the headlining Le Mans Hypercar class.
• ► April 30, 2021 Michelin designs the MICHELIN X Incity EV Z tire, the first MICHELIN range specifically engineered for electric buses.

⁽¹⁾ Polyethylene terephthalate (PET) is a plastic that is currently oil based, with its two monomers, ethylene glycol and terephthalic acid, being derived from petroleum. It is the raw material for one of the main polyester fibers used in tire reinforcements.

• ► May 11, 2021 At the Blue Ocean Awards ceremony, Michelin presents its International Mobility Award to Tarmac Technologies and SUN Mobility, two startups that are contributing to the development of mobility. The Award demonstrates the Group's commitment to leveraging open innovation to become a major player in connected mobility.
• ► May 21, 2021 The Annual Meeting of Michelin shareholders is held behind closed doors in compliance with French health rules. The event was an opportunity for a number of people to pay tribute to Michel Rollier, who stepped down as Chairman of the Supervisory Board. His successor, Barbara Dalibard, was elected at the same-day meeting of the Board.
• ► May 17, 2021 Camso earns recognition as a "Partner level supplier for 2020" in the John Deere Achieving Excellence Program, in honor of its dedication to providing products and services of outstanding quality as well as its commitment to continuous improvement.
• ► May 19, 2021 The new MICHELIN Guide–Tablet Hotels app wins its first award, as "Webby Honoree" in the "Apps and Software" category. The distinction was presented at the Webby Awards, which honor excellence on the Internet.
• ► May 27, 2021 The new MICHELIN TRAILXBIB tire, designed in association with farmers in a number of countries, increases farm yields thanks to the innovative MICHELIN Ultraflex technology.
• ► May 28, 2021 AddUp, the joint venture created by Michelin and Fives in 2016, takes metal 3D printing to the next level with the development of a new generation of machines with promising features for industry.

• ► June 1, 2021 Movin'On's governance body now comprises 10 CEOs. Nine other chief executives of leading global corporations have joined with Florent Menegaux, President of Movin'On and Managing Chairman of the Michelin Group, to set Movin'On's strategic direction and deliver actionable solutions to speed the transition to sustainable mobility.

• ► June 1, 202 At the 2021 Movin'On Summit, Michelin presents two innovations to accelerate the development of sustainable mobility: the WISAMO project, an automated, telescopic, inflatable wing sail system that will help to decarbonize maritime shipping, and a high-performance racing tire containing 46% sustainable materials. Both offer further tangible, real-world proof of the Group's determination to make mobility increasingly sustainable.

• ► June 11, 2021 Madam Maude Portigliatti, currently Senior Vice President, Advanced Research, is appointed Executive Vice President, High Tech Materials.
• ► June 17, 2021 KRISTAL.aero and Michelin launch KRISTAL.air, a mobile app for everyone who flies light aircraft. It not only expresses Michelin Aviation's commitment to fostering connected mobility, safe flying and closer customer relationships, it is also compatible with the Group's "All Sustainable" vision.
• ► June 23, 2021 Michelin designs the new MICHELIN X AGVEV, the first tire specifically engineered for automatic guided vehicles (AGVs) operating in port facilities. The MICHELIN X AGVEV is the first port tire that helps to cut CO² emissions and increase an electric vehicle's battery life, thanks to its very low rolling resistance.
• ► June 30, 2021 Michelin launches the new MICHELIN X® MULTI GRIP™ truck tire designed for extreme winter conditions and wet roads. It also helps to make overland shipping more sustainable, in particular by reducing CO² emissions per kilometer driven.
• ► June 30, 2021 Michelin launches "WATEA by Michelin" to support its corporate customers in transitioning to zeroemission mobility, based on an all-inclusive monthly subscription and a palette of more than 80 services.

A full description of first-half 2021 highlights may be found on the Michelin website: http://www.michelin.com/en

Presentation and Conference Call

First-half 2021 results will be reviewed with analysts and investors during a presentation today, Monday, July 26, 2021 at 6:30 p.m. CEST. The event will be in English, with simultaneous interpreting in French.

Webcast

The presentation will be webcast live on: www.michelin.com/en/finance.

Conference call

Please dial-in on one of the following numbers from 6:20 pm CEST:

• ► In France(French): +33 (0)1 70 71 01 59 PIN code: 38844528#
• ► In France(English): +33 (0) 1 72 72 74 03 PIN code: 83809618#
• ► In the United Kingdom: +44 (0) 207 194 3759 PIN code: 83809618#
• ► In North America: (+1) (646) 722 4916 PIN code: 83809618#
• ► From anywhere else: +44 (0) 207 194 3759 PIN code: 83809618#

The presentation of financial information for the six months ended June 30, 2021 (press release, presentation, financial report) may also be viewed at http://www.michelin.com/en, along with practical information concerning the conference call.

Investor calendar

Financial information for the nine months ended September 30, 2021: Monday, October 25, 2021 after close of trading.

Investor Relations Édouard de Peufeilhoux +33 (0) 6 89 71 93 73 edouard.de-peufeilhoux@michelin.com

Pierre Hassaïri +33 (0) 6 84 32 90 81 pierre.hassairi@michelin.com

Flavien Huet +33 (0) 7 77 85 04 82 flavien.huet@michelin.com Media Relations +33 (0) 1 45 66 22 22 groupe-michelin.service-de-presse@michelin.com

Individual Shareholders Isabelle Maizaud-Aucouturier

+33 (0) 4 73 32 23 05 isabelle.maizaud-aucouturier@michelin.com

Clémence Rodriguez +33 (0) 4 73 32 15 11 clemence.daturi-rodriguez@michelin.com

Disclaimer

This press release is not an offer to purchase or a solicitation to recommend the purchase of Michelin shares. To obtain more detailed information on Michelin, please consult the documents filed in France with Autorité des Marchés Financiers, which are also available from the www.michelin.com/eng website.

This press release may contain a number of forward-looking statements. Although the Company believes that these statements are based on reasonable assumptions at the time of publishing this document, they are by nature subject to risks and contingencies liable to translate into a difference between actual data and the forecasts made or inferred by these

INTRODUCTION	15
FIRST-HALF 2021 RESULTS	17
2021 GUIDANCE	26
APPENDICES	30
CAPITAL MARKETS DAY / KEY MESSAGES	48

• In this context, Michelin teams' commitment helped deliver a 19.6% increase in sales and €1,421m in SOI (2) for the period, with:
• ‒ a 22.8% increase in tire volumes, adding €1,195m to SOI and reflecting market share gains in every segment, especially 18-inch and larger tires, and a 4.6% increase in non-tire activities sales;
• ‒ a €126m increase from positive net price-mix/raw materials effect, as a 1.4% gain from responsive pricing management and a 1.0% increase from favorable mix offsetting the rise in raw material procurement costs;
• ‒ an unfavorable currency effect, stemming primarily from US dollar's weakness against euro, which reduced SOI by €150m.
• ●Free cash flow excluding M&A(3) came to €361m, reflecting growth in SOI and still low inventory levels.
• Gearing stood at 27%, attesting the Group's financial position strength, as confirmed by rating agencies.
• 2021 full-year guidance raised (1): SOI at constant exchange rates > €2,800m, structural free cash flow (4) >€1,000m.

(1) Barring any new systemic effect from Covid-19: deeper supply chain disruptions or tighter restrictions on freedom of movement that would result in a significant drop in the tire markets. (2) Segment operating income.

• (3) Free cash flow before acquisitions, which includes JV financing flows (see slide 12).
• (4) See slide 57 for structural free cash flow definition.

02

SLIDESHOW Introduction

●

●

SLIDESHOW First-half 2021 results

	(in € million)	H1 2021	H1 2020	Change
	me Operating margin RS1 sales Operating inco	% 5,562 730 13.1	4,394 % (35) -0.8	+13.9 pts % +26.6 -
	me RS2 sales Operating margin Operating inco	2,897 % 286 9.9	% 2,411 (30) -1.3	+11.2 pts % +20.2 -
	me Operating margin RS3 sales Operating inco	% 2,733 405 14.8	% 2,552 375 14.7	+0.1 pt % % +8.0 +7.1
In an environment shaped by fast rebounding demand:				* of the segment
were held back by semiconductors shortage. •			RS1: sharp improvement in margins led by responsive pricing management, market share gains in 18-inch and larger tires and a favorable OE/RT mix, as OE sales
fleet management solutions. •				RS2: steep margin improvement led by the upturn in demand, particularly in Europe and North America, responsive pricing management and sustained expansion in
clauses will turn favorable. •			rigorous price management on non-indexed activities partially offset negative impact of raw material clauses in first-half; from the second half of the year, these	RS3: from a less favorable base than in RS1 and RS2, first-half volumes were lifted by sales of Construction and Agricultural tires, leading to a negative business mix;
Fisrt-half 2021 Results - July 26, 2021

SLIDESHOW First-half 2021 results 02

	21 0 2
mes Volu	s t e k r a m e v o b tly a h Slig
materials effect w mix/ra Net price-	alf d-h e n o sitiv c e n s utral o o P e N
ms duties and custo materials prices w mpact of ra Cost i	e tiv a g e gly n n o r t S
Currency effect *	e tiv a g e gly n n o r t S
* Voir slide 24
Résultats 1er semestre 2021 - 26 juillet 2021

	SLIDESHOW
02	Appendices

millions) (in €	1 2 0 1 2 H	H1 2020
Sales	2 9 1,1 1	9,357
ment EBITDA Seg	7 7 2,2	1,192
margin ment EBITDA Seg	% 0.3 2	% 12.7
me ment operating inco Seg	1 2 1,4	310
margin ment operating Seg	% 2.7 1	% 3.3
me and expenses Other operating inco	6 1	(133)
me/(loss) Net inco	2 3 1,0	(137)
Basic earnings per share (in €)	4 5.7	(0.75)
Net cash used in purchases of intangible assets & PPE	4 5 6	769
w* Free cash flo	6 4 3	(351)
Gearing	% 6.7 2	% 45.0
*see slide 57 for definition
Fisrt-half 2021 Results - July 26, 2021

SLIDESHOW Appendices 02

h* OI g u s / S pthro ale Dro s	35% / 45%	-	25% / 30%	80% / 85%	25% / 30%	-30% / -20%	25% / 30%	25% / 30%	80% / 85%
€ change vs. 21 currency 0 H1 2	+ 9%	-	+ 1%	- 7%	- 1%	+ 22%	- 0%	+ 18%	+ 9%
s ale	36%	32%	6%	3%	3%	3%	3%	1%	1%
(2020) % of s	USD	EUR	CNY	AUD	GBP	BRL	CAD	RUB	JPY

* dropthrough linked to the export/manufacturing/sales base.

Fisrt-half 2021 Results - July 26, 2021

(2020) % of s	s ale	€ change vs. currency 21 0 2 H1	h* OI g u s / S pthro ale Dro s
CLP	1%	- 3%	80% / 85%
MXN	1%	+ 3%	25% / 30%
THB	1%	+ 7%	-130% / -100%
TRY	1%	+ 33%	80% / 85%
SEK	0.8%	- 5%	80% / 85%
TWD	0.6%	+ 2%	80% / 85%
ZAR	0.4%	- 3%	80% / 85%
ARS	0.3%	+ 55%	80% / 85%
COP	0.2%	+ 8%	80% / 85%
Others	5.7%	-	-

36 — MICHELIN — FIRST-HALF 2021 FINANCIAL REPORT

Issuer						Compagnie Générale des Établissements MICHELIN
Issue	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note	Senior Note
Type	Convertible	Bond	Convertible	Bond	Bond	Bond	Bond	Bond	Bond	Bond	Bond
Principal Amount	\$ 500m + TAP \$100m	€ 300m	\$ 600m	€ 750m	€ 300m	€ 500m	€ 1'000m	€ 500m	€ 750m	€ 500m	€ 302m
Offering price	100% & 103,85%	99,97%	95,50%	99,10%	99,081%	99,89%	99,262%	99,54%	99,363%	99,46%	98,926%
Rating corporation at Issuance date	A3 (Moody's) A- (S&P)	A3 (Moody's) BBB+ (S&P)	A3 (Moody's) A- (S&P)	A3 (Moody's) A- (S&P)	A3 (Moody's) BBB+ (S&P)	A- (Fitch) A- (S&P)	A3 (Moody's) A- (S&P)	A- (Fitch) A- (S&P)	A3 (Moody's) A- (S&P)	A- (Fitch) A- (S&P)	A3 (Moody's) A- (S&P)
Current corporation rating						A- (S&P) ; A3 (Moody's) ; A- (Fitch)
Coupon	Conv premium ZERO 128%	1.125% p.a	Conv premium ZERO 130%	0.875% p.a	1.750% p.a	0.000% p.a	1.750% p.a	0.250% p.a	2.500% p.a	0.625% p.a	3.250% p.a
Issue Date	& 05-may-17 10-jan.-17	28-may-15	10-jan.-18	3-sept.-18	28-may-15	2-nov.-20	3-sept.-18	2-nov.-20	3-sept.-18	2-nov.-20	& 30-sept.-16 30-sept.-15
Maturity	10-jan.-22	28-may-22	10-nov.-23	3-sept.-25	28-may-27	2-nov.-28	3-sept.-30	2-nov.-32	3-sept.-38	2-nov.-40	30-sept.-45
Interest payment	N/A	May 28 Annual	N/A	Sept 03 Annual	May 28 Annual	Annual Nov 02	Sept 03 Annual	Nov 02 Annual	Sept 03 Annual	Nov 02 Annual	Sept 30 Annual
ISIN	FR0013230745	XS1233732194	FR0013309184	FR0013357845	XS1233734562	FR0014000D31	FR0013357852	FR0014000D49	FR0013357860	FR0014000D56	XS1298728707
Denomination	tradable amount \$ 200'000 with \$ 200'000 min.	€ 1'000 with min. tradable amount € 1'000	\$ 200'000 with min. tradable amount \$ 200'000	€ 100'000 with min. tradable amount € 100'000	€ 1'000 with min. tradable amount € 1'000	€ 100'000 with min. tradable amount € 100'000	€ 100'000 with min. tradable amount € 100'000	€ 100'000 with min. tradable amount € 100'000	€ 100'000 with min. tradable amount € 100'000	€ 100'000 with min. tradable amount € 100'000	€ 1'000 with min. tradable amount € 1'000
	Fisrt-half 2021 Results - July 26, 2021

SLIDESHOW

Appendices 02

SLIDESHOW Capital Markets Day / key messages

ROCE

•

SLIDESHOW

investor-relations@michelin.com

03 2021 first-half business review

3.1		TIRE MARKETS	76
	3.1.1	Passenger car and Light truck tire markets	76
	3.1.2	Truck tire markets	79
	3.1.3	Specialty tire markets	81
3.2	SALES		82
	3.2.1	Analysis of sales	82
	3.2.2	Sales by reporting segment	83
	3.2.3	Changes in exchange rates for the main operating currencies	85
	3.2.4	Sales by region	86
3.3		CONSOLIDATED INCOME STATEMENT REVIEW	87
	3.3.1	Analysis of segment operating income	87
	3.3.2	Segment operating income by reporting segment	88
	3.3.3	Other income statement items	90
3.4		CONSOLIDATED BALANCE SHEET REVIEW	93
	3.4.1	Goodwill	94
	3.4.2	Intangible assets	94
	3.4.3	Property, plant and equipment (PP&E)	94
	3.4.4	Non-current financial assets and other assets	94
	3.4.5	Investments in equity-accounted companies	94
	3.4.6	Deferred tax	94
	3.4.7	Trade working capital	95
	3.4.8	Cash and cash equivalents	95
	3.4.9	Equity	95
	3.4.10	Net debt	95
	3.4.11	Provisions	96
	3.4.12	Employee benefit obligations	97

3.5	CONSOLIDATED CASH FLOW STATEMENT REVIEW	98
	3.5.1 Net cash from operating activities	98
	3.5.2 Capital expenditure	98
	3.5.3 Available cash flow and free cash flow	99
3.6	OUTLOOK FOR 2021	99
3.7	RELATED PARTIES	99
3.8	RISK MANAGEMENT	99
3.9	KEY FIGURES	100
3.10	SHARE INFORMATION	101
	3.10.1 The Michelin share	101
	3.10.2 Detailed share data	102
	3.10.3 Per-share data	102
	3.10.4 Capital and ownership structure	102
3.11	HIGHLIGHTS	103
	3.11.1 Strategy	103
	3.11.2 Innovation	104

3.1 TIRE MARKETS

In the first six months of 2021, worldwide tire demand rebounded sharply off of extremely favorable prior-year comparatives.

In the Passenger car and Light truck segment, the upturn in Original Equipment demand was dampened by the semiconductor shortage, which weighed on global automobile production. In addition to favorable comparatives, the Replacement market benefited from the resumption of mobility and the partial rebuilding of dealer inventories.

In Truck tires, both the Original Equipment and the Replacement market were boosted by the global economic recovery, which is driving strong demand for freight services.

With the crisis receding, the Two-wheel, Construction, Infrastructure and Agricultural tire markets enjoyed robust growth, while Mining tire demand declined slightly due to the less favorable basis of comparison.

Methodological note: Tire market estimates reflect sell-in (sales of manufacturers to dealers) data published by local tiremaker associations, plus Michelin's own estimates of sales by tire manufacturers that do not belong to any association. These estimates are based primarily on import-export statistics and are expressed in the number of tires sold. They are regularly adjusted and may be updated following their initial publication.

3.1.1 PASSENGER CAR AND LIGHT TRUCK TIRE MARKETS

In the first half of 2021, the global Original Equipment and Replacement Passenger car and Light truck tire market rebounded by 26% in number of tires sold.

Michelin estimates.

(2) Including Central America.

3.1.1 a) Original Equipment

Worldwide unit sales of Original Equipment tires rebounded by 27% in the first half of 2021. However, this sharp market upturn from the low 2020 base was dampened by the impact of semiconductor shortages on the global automotive, such as OE demand ended the period still down 14% compared with first-half 2019.

After a first quarter shaped by a 78% upsurge in Chinese demand off of favorable prior-year comparatives, the second three months saw the European and North American markets bounce back, for the same reasons, by 93% and 146% respectively. In China, however, supply chain issues caused demand to contract by 8% over the quarter.

The other regions (South America, Africa/India/Middle East and Southeast Asia) also enjoyed, as expected, a strong recovery in the second quarter.

⁽¹⁾ Including Turkey.

PASSENGER CAR AND LIGHT TRUCK TIRE MARKETS

Original Equipment (in millions of tires)	First-half 2021	First-half 2020	First-half 2021/2020	Second-quarter 2021/2020	First-quarter 2021/2020
Western and Central Europe(1)	38.0	30.3	+26%	+93%	-4%
CIS	3.8	2.8	+38%	+80%	+11%
North America(2)	33.7	24.8	+36%	+146%	-4%
South America	6.3	4.0	+57%	+282%	+3%
China	54.0	44.2	+22%	-8%	+78%
Asia (excluding China)	33.8	28.8	+17%	+50%	-1%
Africa/India/Middle East	14.0	9.4	+48%	+132%	+20%
TOTAL	183.6	144.3	+27%	+46%	+14%

(1) Including Turkey.

(2) Including Central America.

Michelin estimates.

THE OE PASSENGER CAR AND LIGHT TRUCK MARKET IN EUROPE

(in millions of tires – moving 12 months – excluding Russia)

Michelin estimates.

3.1.1 b) Replacement

The global Replacement market rebounded by 25% in the first half, with a faster 46% gain in the second quarter off of much more favorable comparatives in Europe and the Americas, fueled in part by the sustained recovery in mobility and buying ahead of price increases.

In Europe, growth was stronger in the Southern countries, which had experienced stricter lockdowns in first-half 2020, with demand rising 30% in France, 51% in Spain and 28% in Italy, versus 14% in Germany, where mobility restrictions continued throughout the first half. Dealers replenished their inventories ahead of rising prices. In all, European tire demand ended the period down slightly on 2019 levels.

Tire demand in North and Central America rose a steep 37% in the first half, with a faster 74% gain in the second quarter led by very favorable comparatives and the partial rebuilding of dealer inventories. By the end of June, the Replacement market had climbed back above 2019 levels.

THE OE PASSENGER CAR AND LIGHT TRUCK MARKET IN NORTH AMERICA

(in millions of tires – moving 12 months)

Michelin estimates.

In South America, Replacement demand ended the first half up 40% year on year, with an 89% increase in the second quarter and particularly strong growth in Brazil. By period-end, the South American market had made up all of the shortfall since first-half 2019.

In China, after a particularly strong first quarter (up 38% on highly favorable comparatives and inventory rebuilding), demand was down a slight 2% year on year in the second three months, reflecting the return to normal market conditions in April of the the previous year.

In the Africa/India/Middle East region, markets rebounded by 27% in the first half, with an 81% increase in the second quarter led by the strong recovery in demand in India (up 225%) and North Africa (up 87%). Replacement demand, however, remained significantly below 2019 levels.

In Southeast Asia, Replacement demand rose by 12% over the half, with a faster 21% gain in the second quarter. In 2020, the market drop had not been as steep as in the other regions. As of end-June 2021, demand was still below 2019 levels.

PASSENGER CAR AND LIGHT TRUCK TIRE MARKETS

Replacement (in millions of tires)	First-half 2021	First-half 2020	First-half 2021/2020	Second-quarter 2021/2020	First-quarter 2021/2020
Western and Central Europe(1)	151.7	123.9	+22%	+45%	+7%
CIS	30.1	25.3	+19%	+52%	-0%
North America(2)	158.3	115.3	+37%	+74%	+10%
South America	33.3	23.8	+40%	+89%	+12%
China	66.0	57.3	+15%	-2%	+38%
Asia (excluding China)	65.7	58.6	+12%	+21%	+5%
Africa/India/Middle East	49.5	39.0	+27%	+81%	-3%
TOTAL	554.6	443.2	+25%	+46%	+9%

(1) Including Turkey.

(2) Including Central America.

Michelin estimates.

The following table shows the change in demand by major European country in first-half 2021, with growth varying in the non-euro geographies depending on export sales:

PASSENGER CAR AND LIGHT TRUCK TIRES

Replacement	2021 vs. 2020
Western and Central Europe	+22%
▶ of which France	+30%
▶ of which Spain	+51%
▶ of which Italy	+28%
▶ of which United Kingdom	+29%
▶ of which Germany	+14%
▶ of which Poland	+29%
▶ of which Turkey	+10%
CIS	+19%
▶ of which Russia	+20%

THE REPLACEMENT PASSENGER CAR AND LIGHT TRUCK TIRE MARKET IN EUROPE

(in millions of tires – moving 12 months – excluding Russia)

Michelin estimates.

THE REPLACEMENT PASSENGER CAR AND LIGHT TRUCK TIRE MARKET IN NORTH AMERICA

(in millions of tires – moving 12 months)

Michelin estimates.

3.1.2 TRUCK TIRE MARKETS

The number of new Truck tires sold worldwide climbed a sharp 24% in the first half of 2021, lifted by the global economic recovery and the resulting upturn in freight demand.

THE GLOBAL TRUCK TIRE MARKET, FIRST-HALF 2021 VS. FIRST-HALF 2020

(1) Including Turkey.

Michelin estimates – new tire market only.

3.1.2 a) Original Equipment

The global Original Equipment Truck tire market, as measured by the number of new tires sold, grew by 29% in the first half of 2021.

The first quarter delivered growth of 50%, impelled by the 88% increase in Chinese demand ahead of implementation of the China 6 emission standards.

• Growth slowed to 12% in the second three months, reflecting:
• ► an 11% decline in China, as trucking companies completed their fleet upgrades;
• ► strong growth in the other regions, from very favorable comparatives and in sharply rebounding economies.

Global OE demand rose significantly above first-half 2019 levels, led by the brisk growth in China, but remained below them in the European and US markets.

TRUCK MARKETS*

Original Equipment (in millions of tires)	First-half 2021	First-half 2020	First-half 2021/2020	Second-quarter 2021/2020	First-quarter 2021/2020
Western and Central Europe(1)	3.1	2.1	+50%	+98%	+21%
CIS	0.5	0.4	+16%	+19%	+13%
North America(2)	3.2	2.2	+46%	+119%	+10%
South America	1.0	0.7	+55%	+117%	+19%
China	19.5	15.8	+23%	-11%	+88%
Asia (excluding China)	2.0	1.7	+15%	+45%	-3%
Africa/India/Middle East	1.5	1.1	+44%	+127%	+7%
TOTAL	30.8	23.9	+29%	+12%	+50%

* Radial and bias.

(1) Including Turkey.

(2) Including Central America.

Michelin estimates.

⁽²⁾ Including Central America.

THE OE TRUCK TIRE MARKET IN EUROPE

(in millions of radial and bias tires – moving 12 months – excluding Russia)

THE OE TRUCK TIRE MARKET IN NORTH AMERICA (in millions of radial and bias tires – moving 12 months)

Michelin estimates.

3.1.2 b) Replacement

Demand for Replacement Truck tires rose by 22% over the half, with a faster 26% gain in the second quarter.

In Western and Central Europe, in an environment shaped by very favorable economic conditions but also impacted by inventory rebuilding, the Replacement market expanded by 27%, led by very high demand in the Southern countries (up 48% in the Iberian Peninsula, 49% in Italy and 31% in France). As a result, the market ended the period above its 2019 levels.

In North and Central America, the Replacement market climbed 35% over the first six months, with a faster 56% increase in the second quarter. Impelled by the economic upturn in the region, this surge in growth lifted the market well above its pre-crisis levels by the end of June.

In South America, the Replacement market ended the period up 29%, as the 38% economic recovery-led gain in Brazil more than offset the 11% decline in Argentina. Demand now exceeds 2019 levels.

Replacement demand in the Africa/India/Middle East region rose by 16%, led by a 27% increase in India, but remained lower than in 2019.

Demand in Southeast Asia increased by 9% in the first half, with a sharp acceleration to 19% in the second quarter. Growth varied widely by country, from 18% in Thailand and 12% in Indonesia to 7% in Japan and South Korea, and 3% in Australia. The market remains significantly below its pre-crisis levels.

TRUCK MARKETS*

Replacement (in millions of tires)	First-half 2021	First-half 2020	First-half 2021/2020	Second-quarter 2021/2020	First-quarter 2021/2020
Western and Central Europe(1)	8.2	6.5	+27%	+38%	+18%
CIS	3.8	4.0	-5%	+2%	-11%
North America(2)	15.2	11.3	+35%	+56%	+16%
South America	6.8	5.2	+29%	+47%	+16%
China	20.9	16.3	+28%	+4%	+59%
Asia (excluding China)	10.4	9.5	+9%	+19%	+1%
Africa/India/Middle East	14.2	12.2	+16%	+34%	+2%
TOTAL	79.4	65.0	+22%	+26%	+19%

* Radial and bias.

(1) Including Turkey.

(2) Including Central America.

Michelin estimates.

THE REPLACEMENT TRUCK TIRE MARKET IN EUROPE

(in millions of radial and bias tires – moving 12 months – excluding Russia)

Michelin estimates.

3.1.3 SPECIALTY TIRE MARKETS

Mining tires: After a slow start in the first quarter, Surface Mining tire demand is showing some signs of acceleration, paving the way for a strong second half.

Agricultural and Construction tires: The cyclical rebound is continuing apace, particularly in Original Equipment Agricultural tires and in Construction and Materials Handling tires.

Two-wheel tires: Demand remains high in every segment. These personal means of transportation, which still offer a more sanitary alternative to public transport, are structurally well suited to city travel, with demand being driven both by the sustainable image of bicycles and the surging popularity of recreational activities.

Aircraft tires: Demand for commercial aircraft tires is flat in Europe, but has recovered in the Americas and China, particularly from low-cost airlines.

THE REPLACEMENT TRUCK TIRE MARKET

IN NORTH AMERICA

(in millions of radial and bias tires – moving 12 months)

Michelin estimates.

The mining conveyor belt market turned in a mixed performance, with demand stabilizing in Australia, due to sustained Chinese restrictions on Australian ore imports and the absence of any new belt-based mining projects, while business continued to expand in the services and engineering segments. In North America, the business was impacted by customer hesitation, despite the recovery in the coal market and improving conditions in the manufacturing industry.

Specialty polymers: Markets as a whole are experiencing strong growth in demand, especially for precision polymers, hydraulic seals and energy seals.

3.2 SALES

3.2.1 ANALYSIS OF SALES

Michelin estimates.

Sales for the first six months of 2021 totaled €11,192 million, an increase of 19.6% from the year-earlier period that was attributable to the net impact of the following factors:

• ► the robust 22.8% increase in tire volumes, as the stronger than expected upturn in global demand offset the persistent impact of unstable health conditions, serious disruptions in the global supply chain, labor shortages and other crisis factors;
• ► the 2.4% positive tire price-mix effect (0.9% in the first quarter and 4.5% in the second), with i) the €133 million positive price effect resulting from responsive pricing management at a time of rising raw materials prices and transportation and energy costs; ii) the €96 million positive mix effect primarily reflecting the priority focus on the MICHELIN brand in every segment, on high value-added solutions and on share gains in the 18-inch and larger segment; and iii) the positive mix impact from the relative

growth in Automotive Replacement business vs. Original Equipment business which is penalized by component shortages;

• ► the 4.6% increase of non-tire products and services sales, pulled by the recovery of Fenner activities and the growth of fleet management business. Fine dining, hositality and travel segments remain extremely low in the context of health crisis;
• ► the 5.9% negative currency effect, due mainly to the weakness of the US dollar, the Brazilian real and the Turkish lira against the euro during the period;
• ► the low (-0%) unfavorable impact from changes in the scope of consolidation, reflecting the removal of i) the French Maps & Guides printing, publishing and marketing assets as of February 1, 2021; and ii) Solesis following the sale of a stake in its capital to the Altaris fund on May 28, 2021(1) .

⁽¹⁾ See note 2.6 to the condensed interim consolidated financial statements.

(in € millions and %)	First-half 2021	Second-quarter 2021	First-quarter 2021
SALES	11,192	5,744	5,448
Change, year on year	+1,835	+1,714	+121
Volumes	+2,130	+1,728	+402
Price-mix	+229	+184	+45
Currency effect	-548	-227	-321
Changes in scope of consolidation	-1	+4	-5
Non-tire sales	+25	+25	+0
% change, year on year	+19,6%	+42,5%	+2,3%
Volumes	+22.8%	+42.9%	+7.5%
Price-mix	+2.4%	+4.5%	+0.9%
Currency effect	-5.9%	-5.7%	-6.0%
Changes in scope of consolidation	-0.0%	+0.1%	-0.1%
Non-tire sales	+0.3%	+0.6%	-0.0%

3.2.2 SALES BY REPORTING SEGMENT

Segment information is presented according to the following three operating segments:

• ► Automotive and related distribution;
• ► Road transportation and related distribution;
• ► Specialty businesses and related distribution.

The Specialty businesses include the Mining, Off-the-road, Twowheel and Aircraft tire activities as well as the Conveyor Belts and High-Tech Materials activities.

Operating segment performance is measured primarily on the basis of sales and segment operating income, calculated according to the same measurement principles used in the consolidated income statement.

(in € millions)	First-half 2021	Second-quarter 2021	First-quarter 2021
GROUP	11,192	5,744	5,448
Automotive and related distribution	5,562	2,868	2,694
Road transportation and related distribution	2,897	1,509	1,388
Specialty businesses and related distribution	2,733	1,367	1,366
% change, year on year	+19.6%	+42.5%	+2.3%
Automotive and related distribution	+26.6%	+59.6%	+3.7%
Road transportation and related distribution	+20.2%	+43.6%	+2.1%
Specialty businesses and related distribution	+7.1%	+15.7%	-0.3%

3.2.2 a) Automotive and related distribution – Analysis of sales

Volumes in the Automotive and related distribution segment rose by 28% in the first six months of 2021, strengthening the segment's positions as demand rebounded faster than expected over the period, particularly in Replacement markets. During the period, the Group focused on the MICHELIN brand and on high value-added segments, delivering a strong performance while maintaining disciplined, responsive pricing policies at a time of sharply rising costs.

In Original Equipment, the Group maintained its positions during the first half in a market environment that was severely disrupted by the supply outages suffered by carmakers. Growth in the electric vehicle segment continued to have a positive impact.

On the Replacement side, the Group continued to increase its market share in the buoyant 18-inch and larger tire segment, particularly under the MICHELIN brand, and held its leadership in the all-season segment, with the MICHELIN Cross Climate line-up in the regions where it is sold.

In the distribution operations, inventories have returned to normal in some regions, like China, but are still lower than normal on average.

In North America, the Group strengthened its positions in the midst of a strong economic recovery. TBC has successfully rationalized its dealership network and now offers the Group unparalleled market access. Overall, dealer inventories in the region remain below their pre-crisis levels.

In Europe, market share is being gained at a time of fastgrowing sell-out demand, even if some dealers are now approaching pre-crisis inventory levels. The all-season segment, where the Group is expanding its positions, continues to deliver robust growth year after year.

In Asia (excluding India) and particularly in China, the Group is gaining market share in the 18-inch and larger tire segment. The premium tiremaker price increases announced early in the year prompted dealers to move a certain amount of purchasing up to the end of the first quarter, causing a slight slowdown in sell-in demand in the second three months.

While up sharply, Group sales in South America lagged the market, whose growth was led by imported tire sales in Brazil and Chile. Access to the Argentine market is still being hindered by local import quotas.

In the Africa/India/Middle East region, the Group widened its positions in the 18-inch and larger segment, despite the challenges of the health crisis and the introduction of import quotas in India.

In the non-tire businesses, Michelin Experiences – which primarily operates in the fine dining, hospitality and travel markets – continued to be adversely impacted during the first half. During the period, the Group finalized its projects designed to digitize the services portfolio.

Also in the first half, the Robert Parker teams launched their Green Emblem, which honors winemakers who are leading the way in deploying environmentally friendly practices. The initiative is fully aligned with the Green Star award introduced in January 2020 by the MICHELIN Guide teams, which recognizes chefs who are environmentally sensitive and take a more sustainable approach to their cuisine.

In all, sales in the Automotive and related distribution segment jumped by 26.6% to €5,562 million in the first half of 2021, from €4,394 million in the prior-year period. In addition to the strong 28% rebound in tire volumes, the price-mix effect was positive over the first half, reflecting a responsive price management at a time of sharply rising raw materials and transportation costs, a favorable mix between Original Equipment and Replacement sales, as well as market share gains in the 18-inch and larger segment. The slightly negative impact from changes in the scope of consolidation resulted from the removal of the French Maps & Guides printing, publishing and marketing assets as of February 1, 2021.

3.2.2 b) Road transportation and related distribution – Analysis of sales

Volumes in the Road transportation and related distribution reporting segment rose by 23.9% in the first half of 2021, buoyed by the sharp upturn in worldwide economic activity and freight demand.

The Group strengthened its positions in the Original Equipment segment, thanks to a favorable geographic mix.

In Replacement sales, new tire demand is being supported by the economic recovery. Outside China, dealer and fleet inventories are still generally lower than pre-crisis levels. In this environment, the Group continued to place a priority on its value-added offerings, led by the MICHELIN brand and retreading solutions.

In Europe, the Group strengthened its positions while continuing to focus on the MICHELIN brand and on high value-added segments.

The Group's positions in North America continued to suffer from restrictions on production capacity, particularly due to the health precautions still in place, and from labor shortages that are emerging in the wake of the various economic support plans introduced by the US government.

Sales climbed sharply in South America, led by the success of the MICHELIN brand, but were slightly outpaced by an importdriven market.

In Asia (excluding India), and particularly in China, the Group continued to target market segments that value Michelin's solutions for their technological content. In this respect, largescale product demonstrations were organized, attracting more than one million people thanks to online webcasting.

In the non-tire segments, first-half sales growth was supported by the fleet management business, reflecting further contract wins by Sascar and Masternaut, the steady ramp-up in their solutions and the application of disciplined pricing policies in response to rising costs. The two companies are also continuing to expand in the global marketplace, with a focus on Germany, Spain and South Africa.

In all, sales in the Road transportation and related distribution segment amounted to €2,897 million in the first half of 2021, an increase of 20.2% from the €2,411 million reported for the same period in 2020. The improvement was primarily due to the steep 23.9% increase in volumes and the positive price mix over the period, supported by the Group's sustained price discipline and focus on the MICHELIN brand.

3.2.2 c) Specialty businesses and related distribution – Analysis of sales

Mining tires: due to supply and delivery disruptions, volumes were flat on first half, with market share gains in the Surface Mining segment and a strong recovery in Original Equiment sales.

Fenner's conveyor belt business tracked the trend in contrasting markets, with a good momentum in services and engineering activities.

Agricultural and Construction tires: the Group is benefiting from the vitality of the tires and tracks markets and rising market shares, with a particularly strong rebound in Agricultural Original Equiment and Construction tires. The Defense and Powersport segments are also on a positive trend.

Two-wheel tires: driven dynamic markets, price increases and an intense use of production capacities, demand is also growing strong in the Motocycle and Bicycle segments, for the Michelin brand as well as the Levorin and Corsa brands.

Aircraft tires: the Commercial segment is still significantly down compared to 2019, but some positive signs (restart of domestic flights, acceleration of vaccination, type approval renewed for the Boeing 737 Max) could lead to recovery during the second half, occuring unevenly accross different regions.

In all, sales in the Specialty businesses increased by 7.1% over the period, to €2,733 million from €2,552 million in firsthalf 2020. The growth reflected the 12.1% increase in volumes, led by the Off-the-Road businesses (Construction, Agricultural and Materials Handling tires), Original Equipment in general and Two-wheel tires. It was also supported by responsive pricing policies at a time of rising costs.

3.2.3 CHANGES IN EXCHANGE RATES FOR THE MAIN OPERATING CURRENCIES

At current exchange rates, consolidated sales rose by 19.6% in the first six months of 2021. The increase includes the highly negative €549 million currency effect, due mainly to the weakness of the US dollar, the Brazilian real and the Turkish lira against the euro during the first half.

Average exchange rate	First-half 2021	First-half 2020	Change
Euro/USD	1.206	1.102	+9.4%
Euro/CNY	7.802	7.751	+0.7%
Euro/AUD	1.562	1.675	-6.7%
Euro/GBP	0.869	0.874	-0.6%
Euro/BRL	6.484	5.325	+21.8%
Euro/CAD	1.504	1.502	+0.1%
Euro/RUB	89.600	76.110	+17.7%
Euro/JPY	129.733	119.259	+8.8%
Euro/CLP	867.439	893.812	-3.0%
Euro/MXN	24.319	23.570	+3.2%
Euro/THB	37.120	34.824	+6.6%
Euro/TRY	9.465	7.110	+33.1%
Euro/SEK	10.128	10.662	-5.0%
Euro/TWD	33.798	33.071	+2.2%
Euro/ZAR	17.516	18.127	-3.4%
Euro/ARS	109.712	70.741	+55.1%
Euro/COP	4,368.620	4,036.890	+8.2%

First-half 2021 sales by currency were as follows:

Currency	As a % of sales
USD	35%
EUR	33%
CNY	6%
AUD	3%
GBP	3%
BRL	3%
CAD	3%
RUB	2%
JPY	1%
MXN	1%
CLP	1%
THB	1%
TRY	1%
SEK	1%
TWD	0.6%
ZAR	0.5%
ARS	0.2%
COP	0.2%
Other	4.4%
TOTAL	100%

3.2.4 SALES BY REGION

(in € millions)	First half 2021	First half 2020	First half 2021/2020
GROUP	11,192	9,357	+19.6%
Europe	4,248	3,382	+25.6%
of which France	980	768	+27.6%
North America (incl. Mexico)	3,813	3,214	+18.6%
Other regions	3,131	2,761	+13.4%

(in € millions)	First half 2021	% of total	First half 2020	% of total
GROUP	11,192		9,357
Europe	4,248	37.9%	3,382	36.1%
of which France	980	8.8%	768	8.2%
North America (incl. Mexico)	3,813	34.1%	3,214	34.3%
Other regions	3,131	28.0%	2,761	29.5%

The Group's sales increased in every region during the first half.

More than 60% of consolidated sales were generated outside Europe and more than 90% outside France.

3.3 CONSOLIDATED INCOME STATEMENT REVIEW

				First-half 2021	First-half 2020
(in € millions, except per-share data)	First-half 2021	First-half 2020 (1)	2021/2020	(as a % of sales)	(as a % of sales)
Sales	11,192	9,357	+19.6%
Cost of sales	(7,807)	(7,087)	+10.2%	69.8%	75.7%
Gross income	3,385	2,270	+49.1%	30.2%	24.3%
Sales and marketing expenses(1)	(531)	(519)	+2.3%	4.7%	5.5%
Research and development expenses	(328)	(311)	+5.5%	2.9%	3.3%
General and administrative expenses(1)	(1,085)	(1,030)	+5.3%	9.7%	11.0%
Segment other income and expenses	(20)	(100)	-80.0%	0.2%	1.1%
Segment operating income	1,421	310	+358.4%	12.7%	3.3%
Other operating income and expenses	16	(133)	-	0.1%	1.4%
Operating income	1,437	177	+711.9%	12.8%	1.9%
Cost of net debt	(91)	(160)	-43.1%	0.8%	1.7%
Other financial income and expenses	1	(3)	-	0.0%	0.0%
Net interest on employee benefit obligations	(19)	(28)	-32.1%	0.2%	0.3%
Share of profit/(loss) from equity-accounted companies	(32)	(44)	-27.3%	0.3%	0.5%
Income/(loss) before taxes	1,296	(58)	-	11.6%	0.6%
Income tax	(264)	(79)	+234.2%	2.4%	0.8%
NET INCOME/(LOSS)	1,032	(137)	-	9.2%	-1.5%
▶ Attributable to the shareholders of the Company	1,030	(134)	-	9.2%	-1.4%
▶ Attributable to the non-controlling interests	2	(3)	-
EARNINGS PER SHARE (in €)
▶ Basic	5.74	(0.75)
▶ Diluted	5.70	(0.75)

(1) First-half 2020 data have been adjusted for comparison purposes ( see note 2.8 to the condensed interim financial statements).

3.3.1 ANALYSIS OF SEGMENT OPERATING INCOME

(1) Segment operating income.

(2) Mix = product, brand, customer, geographic, OE/RT, division mix.

Segment operating income amounted to €1,421 million or 12.7% of sales, versus €310 million and 3.3% in first-half 2020.

The change in segment operating income primarily reflected:

• ► a €1,195 million increase from the strong growth in tire volumes sold and improved fixed cost absorption;
• ► a robust €229 million increase from the tire price-mix effect, led by disciplined, responsive pricing management, sustained enhancement of the product mix and a favorable business mix;
• ► a €103 million decrease from higher raw material prices and procurement costs;
• ► a €103 million decrease from the rise in tire selling, general and administrative expenses from an exceptionally low firsthalf 2020 base, although these outlays remain far lower than in first-half 2019;
• ► a €24 million decrease from the Group's manufacturing and logistics performance, as manufacturing performance gains were seriously impacted by the sharp €45 million increase in logistics costs, particularly in maritime shipping;
• ► a €9 million improvement in segment operating income from the non-tire businesses;
• ► a €56 million gain stemming primarily from the year-on-year decline in Covid-19-related expenditure, including the cost of purchasing and producing masks and hand sanitizer;
• ► a €150 million decrease from the unfavorable currency effect.

3.3.2 SEGMENT OPERATING INCOME BY REPORTING SEGMENT

(in € millions)	First-half 2021	First-half 2020
AUTOMOTIVE AND RELATED DISTRIBUTION
Sales	5,562	4,394
Segment operating income/(loss)	730	(35)
Segment operating margin	13.1%	-0.8%
ROAD TRANSPORTATION AND RELATED DISTRIBUTION
Sales	2,897	2,411
Segment operating income/(loss)	286	(30)
Segment operating margin	9.9%	-1.3%
SPECIALTY BUSINESSES AND RELATED DISTRIBUTION
Sales	2,733	2,552
Segment operating income	405	375
Segment operating margin	14.8%	14.7%
GROUP
Sales	11,192	9,357
Segment operating income	1,421	310
Segment operating margin	12.7%	3.3%

3.3.2 a) Segment operating margin

(in € millions)

(1) Segment operating income.

Automotive and related distribution (in € millions)	First-half 2021	First-half 2020	2021/2020	2021 (% of consolidated total)	2020 (% of consolidated total)
Sales	5,562	4,394	+26.6%	50%	47%
Change in volumes	28.0%
Segment operating income/(loss)	730	(35)	N/M	51%	-11%
Segment operating margin	13.1%	-0.8%	+13.9 pts

3.3.2 b) Automotive and related distribution – Analysis of segment operating income

Segment operating income amounted to €730 million or 13.1% of sales, versus a loss of €35 million and -0.8% in 2020.

The year-on-year improvement was primarily led by (i) the solid 28% increase in volumes, which drove market share gains, particularly in the MICHELIN-branded 18-inch and larger segment; and (ii) the favorable impact of the relative performances of Replacement and OE tire sales, with the latter hit by the shortages of auto semiconductors. Responsive pricing management helped to offset the increase in raw material prices and procurement costs. Exchange rate movements had a negative impact on the segment's operating income.

3.3.2 c) Road transportation and related distribution – Analysis of segment operating income

Road transportation and related distribution (in € millions)	First-half 2021	First-half 2020	2021/2020	2021 (% of consolidated total)	2020 (% of consolidated total)
Sales	2,897	2,411	+20.2%	26%	26%
Change in volumes	23.9%
Segment operating income/(loss)	286	(30)	N/M	20%	-10%
Segment operating margin	9.9%	-1.3%	+11.2 pts

Segment operating income totaled €286 million or 9.9% of sales, versus a loss of €30 million and -1.3% in first-half 2020.

With the upturn in global demand and a favorable geographic mix, the segment enjoyed a 24% increase in tire volumes sold over the period. The segment's selective marketing strategy and responsive pricing management helped to offset higher raw material prices and procurement costs. The Services & Solutions business is stepping up the pace of growth, led by fleet management solutions. Exchange rate movements had a negative impact on the segment's operating income.

3.3.2 d) Specialty businesses and related distribution – Analysis of segment operating income

Specialty businesses and related distribution (in € millions)	First-half 2021	First-half 2020	2021/2020	2021 (% of consolidated total)	2020 (% of consolidated total)
Sales	2,733	2,552	+7.1%	24%	27%
Change in volumes	12.1%
Segment operating income	405	375	+7.9%	28%	121%
Segment operating margin	14.8%	14.7%	+0.1 pts

Segment operating income in the Specialty businesses stood at €405 million or 14.8% of sales, versus €375 million and 14.7% in first-half 2020.

From a less favorable base than the other two segments, the Specialty businesses reported a 12.1% increase in tire volumes, led by sales of Construction and Agricultural tires, which resulted in a negative mix. Results were lifted by the segment's disciplined price management, but the impact of raw materials indexation clauses remained negative in the first half. The conveyor belt and high-tech materials businesses continued to expand over the period. Exchange rate movements had a negative impact on the segment's operating income.

3.3.3 OTHER INCOME STATEMENT ITEMS

3.3.3 a) Raw materials

The cost of raw materials used in production, which has been estimated at €2.31 billion in first-half 2021, versus €1.82 billion in the year-earlier period, is recognized in the income statement under cost of sales.

It is calculated on the basis of:

• ► the price and mix of raw materials purchases;
• ► production and sales volumes;
• ► the valuation of raw materials, semi-finished and finished product inventories using the weighted average cost method. This method tends to spread fluctuations in purchase costs over time and delay their recognition in cost of sales, due to timing differences between the purchase of the raw materials and the sale of the finished product;
• ► exchange rate movements, which correspond to (i) the impact of converting purchasing costs recorded in local currencies into the consolidation currency; and (ii) an untracked residual currency effect resulting from the difference between the purchasing companies' local currency and the currency used to purchase their raw materials.

In first-half 2021, the raw material costs and related procurement outlays recognized in cost of sales represented a €103 million increase from the prior-year period, including the residual currency effect.

Changes in prices feed through to the income statement five to six months later for natural rubber and around three months later for butadiene.

RAW MATERIALS COSTS RECOGNIZED IN FIRST-HALF 2021 COST OF SALES

NATURAL RUBBER PRICES (SICOM)

BUTADIENE PRICES

3.3.3 b) Employee benefit costs and number of employees

(in € millions and number of people)	First-half 2021	First-half 2020	Change
Total employee benefit costs	3,176	2,954	+7.5%
As a % of sales	28.4%	31.6%	-3.2 pts
Employees on payroll at June 30	123,686	124,000	-0.3%
Number of full-time equivalent employees at June 30	117,540	118,400	-0.7%
Average number of full-time equivalent employees	117,240	119,900	-2.2%

At €3,176 million, employee benefit costs represented 28.4% of sales in first-half 2021, up €222 million from the year-earlier period. In addition to the impact of the upturn in business, the increase reflected the €140 million in furlough grants received by the Group in first-half 2020.

In first-half 2021, €3,167 million was recognized in segment income, and €9 million in other operating income and expenses. In first-half 2020, €2,946 million was recognized in segment operating income, and €8 million in other operating income and expenses.

(in € millions)	First-half 2021	First-half 2020	Change
Total depreciation and amortization	897	927	-3.2%
As a % of sales	8.0%	9.9%

Depreciation and amortization charges edged down by €30 million to €897 million in the first half of 2021, due to the slowdown in capital expenditure in 2020 in response to the Covid-19 crisis and the impairment losses recognized on the Chennai plant in 2020, which lowered depreciation for the year.

Of the total for the period, €856 million was recognized in segment operating income, and €41 million in other operating income and expenses.

3.3.3 d) Transportation costs

Transportation and logistics costs came to €782 million or 7.0% of interim sales, up €292 million on first-half 2020 due to both the increase in volumes shipped and the significant rise in transportation costs across the logistics chain.

(in € millions)	First-half 2021	First-half 2020	Change
Transportation costs	782	490	+59.5%
As a % of sales	7.0%	5.2%

3.3.3 e) Sales and marketing expenses

Sales and marketing expenses represented 4.7% of sales in first-half 2021, versus 5.5% in the first six months of 2020. In value and on a like-for-like basis, they rose by €12 million due to the upturn in business and the decline in the US dollar against the euro, among other favorable exchange rate movements.

The decrease as a percentage of sales was attributable to the volume effect and the price increases implemented over the first half, which increased sales revenue for the period.

3.3.3 f) Research and development expenses

Research and development expenses stood at €328 million, up €17 million year on year, attesting to the Group's commitment to maintaining its technological leadership, particularly to improve the sustainability of both mobility and materials.

As a percentage of sales, R&D expenses declined by 0.4 points compared with first-half 2020.

(in € millions)	First-half 2021	First-half 2020	Change
Research and development expenses	328	311	+5.5%
As a % of sales	2.9%	3.3%

3.3.3 g) General and administrative expenses

General and administrative expenses increased by €55 million year on year to €1,085 million, but declined by 1.3 points as a percentage of sales. The Group is also continuing its efforts to improve competitiveness by rolling out the simplification projects launched before the outbreak of the health crisis.

3.3.3 h) Segment other income and expenses

Segment other income and expenses came to a net expense of €20 million, versus a €100 million expense in first-half 2020.

The improvement was primarily due to the year on year decline in Covid-19-related expenditure, including the cost of purchasing and producing masks and hand sanitizer, which totaled €77 million in first-half 2020.

3.3.3 i) Other operating income and expenses

Other operating income and expenses represented a net gain of €16 million in first-half 2021, versus a net expense of €133 million a year earlier. The shift mainly reflects the following factors:

• ► the favorable impact from the change in consolidation method applied to Solesis, recognized during the period in an amount of €113 million;
• ► the non-recurrence of the unfavorable impact, in first-half 2020, of the write-downs on the intangible assets of the Tablet CGU, in an amount of €39 million.

Other operating income and expenses also includes the amortization of acquired intangible assets for €41 million, versus €45 million in first-half 2020.

3.3.3 j) Cost of net debt

(in € millions)	First-half 2021	First-half 2020	Change
Cost of net debt	91	160	-69

At €91 million, the cost of net debt was down €69 million compared with first-half 2020, primarily as a result of the following factors:

• ► a €29 million decrease in net interest expense, reflecting the net impact of:
• a €9 million increase due to the rise in average gross debt, to €8,085 million in first-half 2021 from €7,555 million in the year-earlier period,
• a €37 million decrease from the lower average gross interest rate on borrowings, at 2.4% in first-half 2021 versus 3.4% in first-half 2020,
• a €1 million decrease from other factors;

3.3.3 k) Other financial income and expenses

		and increasing in 2021.
		► a €6 million decrease in interest income from cash and
	equivalents;

► a €51 million decrease in losses on interest rate derivatives, due mainly to the effect of interest rates declining in 2020

► a €5 million net increase from movements in other factors.

(in € millions)	First-half 2021	First-half 2020	Change
Other financial income and expenses	1	(3)	+4

Other financial income and expenses represented a net financial gain of €1 million, a €4 million upswing versus first-half 2020 that stemmed mainly from the year-on-year improvement in net currency gains and losses.

3.3.3 l) Income tax

(in € millions)	First-half 2021	First-half 2020	Change
Income/(loss) before taxes	1,296	(58)	+1,354
INCOME TAX	(264)	(79)	-185
Current tax	(250)	(77)	-173
Withholding tax	(8)	(19)	+10
Deferred tax	(6)	17	-22

Income tax expense rose by €185 million year on year to €264 million in the first half of 2021, due to the steep increase in income before taxes. The Group's effective tax rate for first-half 2021 was 20.4%.

3.3.3 m) Consolidated net income and earnings per share

(in € millions)	First-half 2021	First-half 2020	Change
Net income/(loss)	1,032	(137)	+1,169
As a % of sales	9.2%	-1.5%	+10.7 pts
▶ Attributable to the shareholders of the Company	1,030	(134)	+1,164
▶ Attributable to the non-controlling interests	2	(3)
EARNINGS PER SHARE (in €)
▶ Basic	5.74	(0.75)	+6.49
▶ Diluted	5.70	(0.75)	+6.45

Net income came to €1,032 million, or 9.2% of sales, compared with the loss of €137 million reported in first-half 2020. The €1,169 million improvement was attributable to the following factors:

► favorable factors:

• the €1,111 million increase in segment operating income,
• the €149 million improvement in net other operating expense,
• the €69 million reduction in the cost of net debt,
• the €12 million improvement in the Group's share of profit from associates and joint ventures,
• a €13 million increase from other favorable factors;
• ► unfavorable factor: the €185 million increase in income tax expense.

3.4 CONSOLIDATED BALANCE SHEET REVIEW

Methodological note: translation adjustments in the balance sheet primarily stem from the translation of prior-year assets and liabilities at closing exchange rates.

ASSETS

		December 31,		Translation
(in € millions)	June 30, 2021	2020	Total change	adjustments	Movement
Goodwill	2,154	2,136	+18	+71	-53
Intangible assets	1,818	1,980	-162	+69	-231
Property, plant and equipment (PP&E)	10,713	10,821	-108	+172	-280
Right-of-use assets	1,052	1,083	-31	+18	-49
Non-current financial assets and other non-current assets	1,165	865	+300	+22	+278
Investments in equity-accounted companies	1,081	941	+140	+20	+120
Deferred tax assets	693	729	-36	+7	-43
Non-current assets	18,676	18,555	+121	+379	-258
Inventories	4,659	3,959	+700	+81	+619
Trade receivables	3,543	3,018	+525	+59	+466
Current financial assets	451	429	+22	0	+22
Other current assets	1,039	929	+110	-10	+120
Cash and cash equivalents	3,812	4,747	-935	+8	-943
Current assets	13,504	13,082	+422	+138	+284
TOTAL ASSETS	32,180	31,637	+543	+517	+26

EQUITY AND LIABILITIES

		December 31,		Translation
(in € millions)	June 30, 2021	2020	Total change	adjustments	Movement
Share capital	357	357	0		0
Share premiums	2,746	2,746	0		0
Reserves	10,682	9,530	+1,152	+337	+815
Non-controlling interests	(1)	(2)	+1	0	+1
Total equity	13,784	12,631	+1,153	+337	+816
Non-current financial liabilities	5,354	6,169	-815	+9	-824
Non-current lease liabilities	755	801	-46	+12	-58
Provisions for employee benefit obligations	3,408	3,700	-292	+35	-327
Provisions and other non-current liabilities	768	775	-7	+11	-18
Deferred tax liabilities	421	425	-4	+17	-21
Non-current liabilities	10,706	11,870	-1,164	+84	-1,248
Current financial liabilities	1,653	1,546	+107	+4	+103
Current lease liabilities	229	222	+7	+4	+3
Trade payables	2,351	2,291	+60	+38	+22
Trade payables under reverse factoring agreements	506	437	+69	+9	+60
Provisions and other current liabilities	2,951	2,640	+311	+42	+269
Current liabilities	7,690	7,136	+554	+96	+458
TOTAL EQUITY AND LIABILITIES	32,180	31,637	+543	+517	+26

3.4.1 GOODWILL

Goodwill at June 30, 2021 is down €53 million from December 31, 2020 following the deconsolidation of Solesis.(1) No impairment losses were recognized on the CGUs or groups of CGUs at June 30, 2021.

3.4.2 INTANGIBLE ASSETS

Intangible assets stood at €1,818 million, a €231 million decrease from December 31, 2020 before translation adjustments. This change stemmed primarily from the deconsolidation of Solesis assets, in an amount of €198 million.

3.4.3 PROPERTY, PLANT AND EQUIPMENT (PP&E)

Property, plant and equipment amounted to €10,713 million at June 30, 2021, down €280 million from December 31, 2020 before translation adjustments, reflecting the fact that overall depreciation charges exceeded capital expenditure for the period.

3.4.4 NON-CURRENT FINANCIAL ASSETS AND OTHER ASSETS

Non-current financial assets and other non-current assets stood at €1,165 million, an increase of €278 million before translation adjustments, mainly resulting from the increase in loans to equity-accounted companies. This particularly concerned Solesis, which was equity-accounted after a stake was sold to Altaris in the first-half(2) .

3.4.5 INVESTMENTS IN EQUITY-ACCOUNTED COMPANIES

Investments in equity-accounted companies amounted to €1,081 million at June 30, 2021, up €120 million before translation adjustments. The increase was mainly due to the change to equity accounting of Solesis following the sale of a 51% stake to Altaris. An unfavorable impact of €32 million resulted from the Group's share in the losses from equity-accounted companies; following impairement performed during first half, the Group recorded impairement of €25 million on equity-accounted companies in the natural rubber production industry.

3.4.6 DEFERRED TAX

Excluding translation adjustments, deferred tax assets declined by €43 million compared with December 31, 2020, mainly due to the €64 million decline in deferred taxes on items recognized in equity and the €48 million increase from the deconsolidation of Solesis.

⁽¹⁾ See note 2.6.1 to the condensed interim consolidated financial statements.

⁽²⁾ See note 2.6.1 to the condensed interim consolidated financial statements.

3.4.7 TRADE WORKING CAPITAL

(in € millions)	June 30, 2021	June 30, 2020	Change	June 30, 2021 (as a % of sales, moving 12 months)	June 30, 2020 (as a % of sales, moving 12 months)
Inventories	4,659	4,318	+341	20.9%	19.9%
Trade receivables	3,543	2,844	+699	15.9%	13.1%
Trade payables	(2,351)	(1,615)	-736	-10.5%	-7.4%
Trade payables under reverse factoring agreements	(506)	(264)	-242	-2.3%	-1.2%
TRADE WORKING CAPITAL	5,345	5,283	+62	24.0%	24.3%

Trade working capital requirement increased by €62 million compared with June 30, 2020, as business recovered quickly during first-half 2021. It represented 24.0% of moving 12-month sales, a 0.3-point improvement on June 30, 2020.

At €4,659 million, inventories ended the period up €341 million, or 1 percentage point of sales, compared with June 30, 2020, when they were historically low during a major global crisis. The increase also reflects the impact of higher raw materials prices.

3.4.8 CASH AND CASH EQUIVALENTS

Cash and cash equivalents stood at €3,812 million at June 30, 2021, a €943 million decrease from December 31, 2020 (before translation adjustments) that was primarily due to the following factors:

• ► increases from:
• the €346 million in free cash flow;

3.4.9 EQUITY

At €13,784 million, total equity, before translation adjustments, was €816 million higher than at December 31, 2020, primarily due to the following factors:

• ► €1,557 million in comprehensive income for the period, including in particular:
• €1,032 million in net income for the period
• a €254 million favorable impact from post-employment benefit obligations,
• a €67 million increase in taxes payable on those obligations,

3.4.10 NET DEBT

Net debt stood at €3,679 million at June 30, 2021, up €148 million from December 31, 2020, mainly as a result of the following factors:

► the €346 million in positive free cash flow for the period;

Trade receivables stood at €3,543 million at June 30, 2021, a €699-million increase in line with the strong growth in sales. As a percentage of sales, they rose 2.8 points to 15.9% from an exceptionally low base in June 2020.

Trade payables, including those covered by reverse factoring contracts, rose by €978 million year on year to €2,857 million. The steep increase stemmed from the strong growth in business and the general upturn in raw material prices and procurement costs.

• ► decreases from:
• the €891 million reduction in debt over the period,
• the payment of €414 million in dividends and other distributions.
• a €5 million decrease in the fair value of hedging instruments,
• a €6 million increase from other factors;
• ► the payment of €414 million in dividends and other distributions.

As a result, at June 30, 2021, the share capital of Compagnie Générale des Établissements Michelin stood at €356,700,078, comprising 178,350,039 shares corresponding to 236,469,545 voting rights.

• ► the payment of €414 million in dividends and other distributions;
• ► €85 million in new leases.

CHANGES IN NET DEBT

(in € millions)	First-half 2021	First-half 2020
At January 1	3,531	5,184
Free cash flow(1) before M&A and net financing of joint ventures and associates	(367)	248
Investments in new ventures	15	41
Net financing of joint ventures and associates	6	62
Free cash flow(1)	(346)	351
Distributions and other	414	0
Share buybacks	0	99
New finance leases	85	95
Change in scope of consolidation	(4)	1
Translation adjustment	21	(186)
Other	(23)	(34)
AT JUNE 30	3,679	5,510
CHANGE	+148	+326

(1) Free cash flow corresponds to net cash from operating activities less net cash used in investing activities, adjusted for net cash flows relating to cash management financial assets and borrowing collaterals.

3.4.10 a) Gearing

Gearing stood at 26.7% at June 30, 2021, versus 45.0% a year earlier.

3.4.10 b) Credit ratings

The solicited corporate credit ratings of Compagnie Générale des Établissements Michelin (CGEM), Compagnie Financière Michelin SA and CFM Suisse SA are as follows:

		CGEM	Compagnie Financière Michelin SA	CFM Suisse SA
Short term	Standard & Poor's	A-2	A-2	A-2
	Fitch Ratings	F2	F2	F2
Long term	Standard & Poor's	A-	A-	A
	Fitch Ratings	A-	A-	A
Outlook	Standard & Poor's	Stable	Stable	Stable
	Fitch Ratings	Stable	Stable	Stable

► On December 21, 2020, Standard & Poor's affirmed Michelin's short-term A-2 and long-term A- credit ratings, while revising the outlook from negative to stable.

► On March 19, 2021, Fitch Ratings affirmed Michelin's short-term F2 and long-term A- credit ratings, as well as its stable outlook.

Moody's, whose rating has not been solicited since July 1, 2020, nevertheless affirmed, on April 28, 2021, CGEM's long-term credit rating and the stable outlook for CGEM, CFM and CFM Suisse:

	CGEM	Compagnie Financière Michelin SA	CFM Suisse SA
Long term	A3	N/A	N/A
Outlook	Stable	Stable	Stable

3.4.11 PROVISIONS

Provisions and other non-current liabilities amounted to €768 million, down €19 million before translation adjustments. The decrease was primarily due to payments out of restructuring provisions set aside in prior years and the transfer of short-term provisions to current liabilities, which were partially offset by the new provisions set aside in 2021 as part of the French simplification and competitiveness plan announced on January 6, 2021.

3.4.12 EMPLOYEE BENEFIT OBLIGATIONS

CHANGE IN THE FAIR VALUE OF THE NET DEFINED BENEFIT OBLIGATION

			First-half	First-half
(in € millions)	Pension plans	Other plans	2021	2020
At January 1	1,626	1,863	3,489	3,828
Contributions paid to the funds	(10)	-	(10)	(84)
Benefits paid directly to the beneficiaries	(29)	(42)	(71)	(70)
Other movements	-	(4)	(4)	-
Items recognized in operating income
Current service cost	22	34	56	55
Actuarial (gains) or losses recognized on other long-term benefit plans	-	-	-	-
Past service cost resulting from the introduction of new plans
or plan amendments	-	-	-	-
Past service cost resulting from plan curtailments	-	-	-	-
(Gains) or losses on plan settlements	-	-	-	-
Effect of plan curtailments recognized within reorganizations
and adaptation of activities	(33)	(54)	(87)
Other items	5	-	5	3
Items recognized outside operating income
Net interest on employee benefit obligations	6	13	19	28
Items recognized in other comprehensive income
Translation adjustments	(5)	28	23	(17)
Actuarial (gains) or losses	(213)	(81)	(294)	(112)
Unrecognized assets due to the effect of the asset ceiling	40	-	40	33
AT JUNE 30	1,408	1,758	3,166	3,664

The net defined benefit obligation recognized in the balance sheet at June 30, 2021 amounted to €3,166 million, down €364 million year on year before €23 million in translation adjustments.

The decline reflected the following main factors:

• ▶ €81 million in payments under defined benefit plans during the period (first-half 2020: €154 million), of which:
• €10 million in contributions paid to fund management institutions (first-half 2020: €84 million),
• €71 million in benefits paid directly to employees (first-half 2020: €70 million);
• ▶ €294 million in actuarial gains recognized in equity at June 30, 2021, which can be broken down as follows:

• €460 million in actuarial gains on the obligation, mainly resulting from the use of higher discount rates in North America, the United Kingdom and Europe,

• €166 million in actuarial losses on plan assets, stemming primarily from the low real return on the assets over the period in Canada and the United Kingdom;

• ► a €7 million gain recognized in the income statement in respect of defined benefit plan costs, of which €87 million stemming from the French competitiveness plan announced on January 6, 2021(1) (2020: €86 million expense);
• ► the recognition in the statement of comprehensive income of €40 million in assets otherwise unrecognized, in accordance with the application of the asset ceiling rule to the Canadian pension plan;
• ► €4 million in other movements lowering the net benefit obligation.

In addition, contributions paid by the Group into defined contribution plans totaled €103 million in first-half 2021 (first-half 2020: €111 million).

⁽¹⁾ See note 4.1 to the condensed interim consolidated financial statements.

3.5 CONSOLIDATED CASH FLOW STATEMENT REVIEW

3.5.1 NET CASH FROM OPERATING ACTIVITIES

(in € millions)	First-half 2021	First-half 2020	Change
Segment EBITDA	2,277	1,192	+1,085
Change in net inventories	(629)	304	-933
Change in net trade receivables	(412)	262	-674
Change in net trade payables	186	(840)	+1,026
Restructuring cash costs	(108)	(110)	+2
Tax and interest paid	(339)	(266)	-73
Other	29	(52)	+81
NET CASH FROM OPERATING ACTIVITIES	1,004	490	+514

At €2,277 million, segment EBITDA was up €1,085 million year on year, reflecting the €1,111 million increase in segment operating income, to €1,421 million from €310 million in firsthalf 2020.

Net cash from operating activities grew by €514 million, to €1,004 million from €490 million in first-half 2020.

The increase in inventories, trade receivables, trade payables and other working capital items reflects the upturn in business.

Restructuring cash costs were unchanged year on year, as were other factors having an impact on cash (€8 million increase in tax and interest paid and other cash items).

3.5.2 CAPITAL EXPENDITURE

(in € millions)	First-half 2021	First-half 2020	2021/2020	2021 (as a % of sales)	2020 (as a % of sales)
Additions to intangible assets and PP&E	543	490	+53	4.9%	5.2%
Investment grants received and change in capital expenditure payables	111	279	-168	1.0%	3.0%
Proceeds from sales of intangible assets and PP&E	(17)	(24)	+7	-0.2%	-0.3%
NET ADDITIONS TO INTANGIBLE ASSETS AND PROPERTY, PLANT AND EQUIPMENT	637	745	-108	5.7%	8.0%

Gross purchases of intangible assets and property, plant

and equipment amounted to €543 million in first-half 2021, a €53 million year-on-year increase.

Following on from the prior-year period's €175 million year-onyear reduction, the first-half 2021 increase attests to the Group's determination to continue investing (i) to improve the flexibility, competitiveness and safety of its manufacturing facilities; and (ii) to deploy technological innovations to support its expansion strategy in High-Tech Materials and Services & Solutions.

Note, however, that capital expenditure outlays during the first half were held back by procurement issues across the supply chain, which caused delays in a number of projects.

3.5.3 AVAILABLE CASH FLOW AND FREE CASH FLOW

Available cash flow corresponds to cash flow from recurring operations, i.e., after routine capital expenditure but before growth investments.

Free cash flow, which is stated before dividend payments and financing transactions, corresponds to net cash from operating activities less net cash used in investing activities, adjusted for net cash flows relating to cash management financial assets and borrowing collaterals.

(in € millions)	First-half 2021	First-half 2020	Change
Net cash from operating activities	1,004	490	514
Routine capital expenditure (maintenance, IT, dealerships, etc.)	(338)	(296)	-42
AVAILABLE CASH FLOW	666	194	+472
Competitiveness and growth investments	(140)	(142)	+2
Investments in new ventures	(65)	(52)	-13
Acquisitions	(15)	(41)	+26
Other	(100)	(310)	+210
FREE CASH FLOW	346	(351)	+697

After subtracting €338 million in routine capital expenditure, available cash flow stood at €666 million for first-half 2021.

During the period, the Group invested €15 million in acquisitions, none of which were individually material.

Free cash flow amounted to a positive €346 million in first-half 2021, compared to negative €351 million in first-half 2020.

3.6 OUTLOOK FOR 2021

After recovering sharply in the first half, global demand will not benefit from as favorable a base in the second half of the year, when it will likely continue to be impacted by global supply chain disruptions. Passenger car and Light truck tire markets are expected to expand by between 8% and 10% over the year and Truck tire markets by between 6% and 8%. The Specialty markets should deliver growth of 10% to 12% over the year.

Barring any new systemic effect from Covid-19(1), Michelin plans to strengthen its positions in the prevailing market environment. Consequently, the Group is raising its objectives for the full year, targeting segment operating income in excess of €2.8 billion at constant exchange rates (versus the previously announced > €2.5 billion) and structural free cash flow(2) of more than €1 billion (versus around €1 billion).

3.7 RELATED PARTIES

There were no new material related-party transactions during the first half of 2021, nor any material changes in the related-party transactions described in the 2020 Universal Registration Document.

3.8 RISK MANAGEMENT

The Michelin Group's main risks have been identified and are described in the 2020 Universal Registration Document, Chapter 2.

⁽¹⁾ Deeper supply chain disruptions or tighter restrictions on freedom of movement that would result in a significant drop in the tire markets.

⁽²⁾ Structural free cash flow corresponds to the free cash flow before acquisitions, adjusted for the impact of changes in raw material costs on trade payables, trade receivables and inventories.

3.9 KEY FIGURES

	First half	First half
(in € millions)	2021	2020	2020	2019	2018	2017	2016
Sales	11,192	9,357	20,469	24,135	22,028	21,960	20,907
% change	+19.6%	-20.6%	-15,2%	+9.6%	+0.3%	+5.0%	-1.4%
Total employee benefit costs	3,176	2,954	5,996	6,365	6,038	5,871	5,542
as a % of sales	28.4%	31.6%	29,3%	26.4%	27.4%	26.7%	26.5%
Number of full-time equivalent employees at period
end	117,240	119,900	117,500	121,300	111,100	107,800	105,700
Research and development expenses	328	311	646	687	648	641	718
as a % of sales	2.9%	3.3%	3,2%	2.8%	2.9%	2.9%	3.4%
Segment EBITDA(1)	2,277	1,192	3,631	4,763	4,119	4,087	4,084
Segment operating income	1,421	310	1,878	3,009	2,775	2,742	2,692
Segment operating margin	12.7%	3.3%	9.2%	12.5%	12.6%	12.5%	12.9%
Operating income	1,437	177	1,403	2,691	2,550	2,631	2,791
Operating margin	12.8%	1.9%	6.9%	11.1%	11.6%	12.0%	13.3%
Cost of net debt	91	160	242	330	200	176	203
Other financial income and expenses	1	(3)	(14)	(5)	16	0	20
Income before taxes	1,296	(58)	979	2,236	2,230	2,354	2,464
Income tax	264	79	354	506	570	661	797
Effective tax rate	20.4%	n.c.	36.2%	22.6%	25.6%	28.1%	32.3%
Net income/(loss)	1,032	(137)	625	1,730	1,660	1,693	1,667
as a % of sales	9.2%	-1.5%	3.1%	7.2%	7.5%	7.7%	8.0%
Dividends	410	-	357	666	637	585	522
Net cash from operating activities	1,004	490	3,366	3,321	2,831	2,741	2,764
as a % of sales	9.0%	8.2%	16,4%	13.8%	12.9%	12.5%	13.2%
Gross purchases of intangible assets and PP&E	543	490	1,121	1,801	1,669	1,771	1,811
as a % of sales	4.9%	8.2%	6.0%	7.5%	7.6%	8.1%	8.7%
Net debt(2)	3,679	5,510	3,531	5,184	4,056	716	944
Total equity	13,784	12,239	12,631	13,229	12,181	11,261	10,646
Gearing	27%	45%	28%	39%	33%	6%	9%
Net debt(2)/EBITDA(1)	1.62	4.62	0.97	1.09	0.98	0.18	0.23
Segment operating income/net interest expense(3)	13.5	2.4	7.9	10.1	13.3	15.9	13.3
Free cash flow(4)	346	(351)	2,004	1,142	-1,985	662	1,024
ROE(5)	-	-	4.9%	13.1%	13.6%	15.0%	15.7%
ROCE(6)	-	-	6.0%	10,0%	-	-	-
PER-SHARE DATA (IN €)
Net assets per share(7)	77.3	68.5	70,8	74.1	67.8	62.7	59.1
Basic earnings per share	5.74	(0.75)	3.52	9.69	9.30	9.39	9.21
Diluted earnings per share	5.70	(0.75)	3.51	9.66	9.25	9.34	9.03
Price-earnings ratio(8)	-	-	29.8	11.3	9.3	12,7	11.5
Dividend per share	-	-	2.30	2,00	3.70	3.55	3.25
Payout ratio(9)	-	-	47%	19,5%	36.4%	36.0%	36.5%
Yield(10)	-	-	2.2%	1,8%	4.3%	3.0%	3.1%

(1) As defined in note 3.7.2 to the consolidated financial statements

(2) Net debt: financial liabilities - cash and cash equivalents (excluding cash flows from cash management financial assets and borrowing collaterals) +/- derivative assets, as defined in note 26 to the 2020 consolidated financial statements.

(3) Net interest expense: interest financing expenses - interest income from cash and equivalents.

(4) Free cash flow: net cash from operating activities less net cash used in investing activities (adjusted for net cash flows relating to cash management financial assets and borrowing collaterals), as defined in section 3.5.3.

(5) ROE: net income attributable to shareholders divided by shareholders' equity excluding non-controlling interests.

(6) ROCE: Net Operating Profit After Tax (NOPAT)/capital employed (intangible assets and PP&E + long-term financial assets + working capital requirement). As from 2021, ROCE will be measured by the Group by adding back amortization of acquired intangible assets and profit from equity-accounted companies to the numerator and goodwill, acquired intangible assets and investments in equity-accounted companies to economic assets to the denominator.

(7) Net assets per share: total equity/number of shares outstanding at the end of the period.

(8) P/E: Share price at the end of the period/basic earnings per share.

(9) Payout ratio: Dividend/net income excluding non-recurring items (adjusted with respect to the nominal tax rate).

(10) Dividend yield: dividend per share/share price at December 31.

3.10 SHARE INFORMATION

3.10.1 THE MICHELIN SHARE

Traded on the Euronext Paris stock exchange

• ► Compartment A;
• ► Eligible for the SRD deferred settlement system;
• ► ISIN: FR 0000121261;
• ► Par value: €2;
• ► Traded in units of: 1.

Market capitalization

► €23,988 million at June 30, 2021.

Average daily Euronext trading volume

► 485,329 shares since January 1, 2021.

MICHELIN SHARE PERFORMANCE AND TRADING VOLUMES

According to statistical data collected by Euronext Paris

Indices

The Michelin share is included in two leading stock market indices:

• ► CAC 40: 1.60% of the index at June 30, 2021;
• ► Euronext 100: 0.61% of the index at June 30, 2021.

Michelin is also included in the main Socially Responsible Investing (SRI) indices:

► Ethibel Excellence Europe and Global, Euronext VigeoEiris France 20, Europe 120, Eurozone 120, World 120 and FTSE4Good.

* Standardized monthly averages (base 100 = July 1, 2016).

3.10.2 DETAILED SHARE DATA

According to statistical data collected by Euronext Paris.

	First-half
Share price (in €)	2021	2020	2019	2018	2017	2016
Session high	137.95	112.80	119.50	130.85	128.40	106.80
Session low	103.30	68.00	83.74	82.68	98.93	77.40
High/low ratio	1.34	1.66	1.43	1.58	1.30	1.38
Closing price, end of period	134.50	104.95	109.10	86.70	119.55	105.70
Average closing price over the period	122.36	95.49	104.36	109.40	115.65	91.97
Change in the Michelin share price over the period	26.00%	-3.80%	25.84%	-27.48%	13.10%	20.25%
Change in the CAC 40 index over the period	16.44%	-7.14%	26.37%	-10.95%	9.26%	4.86%
Change in the Stoxx Europe 600 index over the period	12.73%	-4.04%
Market capitalization (at end of the period, in € billions)	23.99	18.72	19.49	15.59	21.45	19.03
Average daily trading volume over the period	485,329	548,883	577,545	649,347	503,534	554,262
Average number of shares outstanding	178,346,100				178,497,159 179,669,608 179,384,513 180,212,806 182,122,667
Volume of shares traded over the period	60,180,827				141,062,953 147,273,882 165,583,378 128,401,095 142,445,218

3.10.3 PER-SHARE DATA

	First-half
(in € per share, except ratios)	2021	2020	2019	2018	2017	2016
Net asset value per share	77.3	70.8	74.1	67.8	62.7	59.1
Basic earnings per share	5.74	3.52	9.69	9.30	9.39	9.21
Diluted earnings per share(1)	5.70	3.51	9.66	9.25	9.34	9.03
PER	-	29.8	11.3	9.4	12.7	11.5
Dividend per share	-	2.30	2.00	3.70	3.55	3.25
Payout ratio (excl. non-recurring items)	-	47.0%	19.5%	36.4%	36.0%	36.5%
Yield(2)	-	2.2%	1.8%	4.3%	3.0%	3.1%

(1) Earnings per share adjusted for the impact on net income and on average shares outstanding of the exercise of outstanding dilutive instruments.

(2) Dividend/share price at December 31.

3.10.4 CAPITAL AND OWNERSHIP STRUCTURE

At June 30, 2021, Michelin's share capital amounted to €356,700,078.

		At June 30, 2021		At December 31, 2020
	Number of shareholders	Shares outstanding	Voting rights outstanding	Number of shareholders	Shares outstanding	Voting rights outstanding
French institutional investors	3,910	25.7%	29.6%	3,938	27.1%	29.3%
Non-resident institutional investors		63.4%	56.7%		61.8%	57.1%
Individual shareholders	135,871	9.1%	11.5%	136,935	9.1%	11.4%
Employee share ownership plan	65,595	1.8%	2.2%	69,378	2.0%	2.3%
Treasury shares	-	-	-	-	-	-
TOTAL	205,376	178,350,039 shares*	236,469,545 voting rights	210,251	178,340,086 shares*	243,584,598 voting rights

* All fully paid up.

Shares held in the same name for at least four years carry double voting rights.

3.11 HIGHLIGHTS

3.11.1 STRATEGY

January 6, 2021 – Michelin launches a simplification and competitiveness project to support developments in its operations in France.

To prepare for the future, Michelin has launched a three-year project to upgrade and transition its manufacturing, corporate and administrative operations in France. As part of this process, the Group has reaffirmed its commitment to positioning France in the production of premium and specialty tires while continuing to base new high value-added businesses in the country, particularly in the services, sustainable materials, energy transition and recycling segments. The simplification and competitiveness plan will be supported by an innovative social dialogue process. The 2021 Collective Settlement Agreement signed on June 7 by the CFDT, CFE-CGC and SUD trade unions was approved by the local labor authorities (DREETS) on June 14, enabling deployment of the Agreement's voluntary early retirement and outplacement measures.

January 18, 2021 – Michelin unveils the 2021 MICHELIN Guide France and its Green Stars.

For the second year in a row, the MICHELIN Guide has awarded a MICHELIN Green Star to a selection of restaurants committed to advocating a virtuous, sustainable approach to gastronomy. The 33 restaurants singled out this year are continuing to pave the way towards a more responsible future.

February 24, 2021 – The Coalition for the Energy of the Future announces seven projects with major milestones in 2021.

To date, 14 companies, including Michelin, have joined the Coalition in a commitment to accelerating the energy transition in transportation and across the entire supply chain. To achieve genuine technological breakthroughs with tangible results by 2030, the Coalition's three main goals are to i) unlock a more extensive portfolio of clean energy sources; ii) decrease the energy consumption per kilometer-equivalent of goods mobility; and iii) reduce the proportion of emissions linked to transport and logistics.

March 19, 2021 – Michelin partners with sennder, Europe's leading digital freight forwarder.

Through their partnership, Michelin and sennder will deliver a suite of fleet services to make road freight more cost effective and less carbon intensive. sennder and Michelin's collaboration will initially focus on Northern Europe and Iberia, with plans to scale it across other European markets throughout 2021.

April 2, 2021 – BMW Group reaffirms its trust in Michelin tires.

The benefits of Michelin and BMW's long-standing, 35-year relationship, built on the shared values of precision, performance, responsibility and innovation, have again been illustrated with the development of the MICHELIN Pilot Sport 4S and the MICHELIN Pilot Sport Cup 2 Connect tires specifically for the BMW M3 and M4.

April 8, 2021 – Michelin presents Michelin in Motion, its "All Sustainable" strategy for 2030.

At the Group's Capital Markets Day, Florent Menegaux explained the "All Sustainable" vision, which is based on constantly seeking the right balance between People, Profit and Planet. He also presented the Group's ambitious targets for 2030 and reaffirmed the commitment to driving strong expansion in five tire-related and other business segments: services and solutions, flexible composites, healthcare, metal 3D printing and hydrogen mobility.

April 2021 – Symbio, a Faurecia Michelin Hydrogen Company, is helping to accelerate the transition to hydrogen mobilty.

Symbio is on a roll with its two development projets underway, one with bus manufacturer Safra and the other with Stellantis, in a further illustration of the growing importance of hydrogen technology in making zero-emission mobility a reality. The company is building Europe's largest hydrogen fuel cell plant in Saint-Fons, France, with start-up scheduled for 2023.

April 15, 2021 – Michelin and Altaris announce their intention to join forces to speed the growth of Solesis, a Michelin subsidiary specializing in biomaterials for the healthcare industry.

The Partnership Agreement has three components: i) the acquisition of a 51% stake in Solesis by Altaris; ii) the deployment of a governance system; and iii) a research and development partnership between Michelin and Solesis. The announcement offers another compelling illustration of the Group's commitment to expanding beyond tires, with a focus on high-tech materials.

May 17, 2021 – Camso earns recognition as a "Partner-level supplier for 2020" in the John Deere Achieving Excellence Program.

The Partner-level status is Deere & Company's highest supplier rating. The honor recognizes Camso's dedication to providing products and services of outstanding quality as well as its commitment to continuous improvement.

May 21, 2021 – The 2021 Annual Meeting of Michelin shareholders is held behind closed doors in compliance with French health rules.

The event was an opportunity for a number of people to pay tribute to Michel Rollier, who stepped down as Chairman of the Supervisory Board. His successor, Barbara Dalibard, was elected at the sameday meeting of the Board.

June 1, 2021 – Movin'On's governance body now comprises 10 CEOs.

Nine other chief executives of leading global corporations have joined with Florent Menegaux, President of Movin'On and Managing Chairman of the Michelin Group, to set Movin'On's strategic direction and deliver actionable solutions to speed the transition to sustainable mobility. The new shared governance is a major milestone in Movin'On's development.

3.11.2 INNOVATION

February 8, 2021 – The MICHELIN X® Multi™ Energy™ family of regional truck tires is enhanced with two new fitments.

The new models offer a host of benefits, including higher fuel efficiency, lower CO2 emissions, increased mileage, greater multi-use versatility and improved safety. The technologies leveraged to deliver these performance features attest to the Group's powerful innovation capabilities.

February 9, 2021 – CAMSO optimizes productivity for its construction industry customers.

CAMSO has introduced the CAMSO TLH 732+ telehandler tire that delivers 64% more service life than its predecessor, the TLH 732. The new tire offers professionals in the construction industry performance, long-lasting durability, puncture resistance and improved traction.

February 11, 2021 – Michelin signs a letter of commitment for maritime transport with Neoline, a French shipowner relying mainly on sail propulsion.

This first step towards carbon-free shipping is fully in line with the CSR(1) strategy being pursued in Michelin's operations. It will help to meet the objective of reducing CO2 emissions from logistics by 15% in absolute terms between 2018 and 2030. Like its production plants, which are committed to the ambitious goal of eliminating CO2 emissions by 2050, Michelin is actively testing new solutions to decarbonize its logistics operations.

June 11, 2021 – Maude Portigliatti is appointed Executive Vice President, High-Tech Materials.

Currently Senior Vice President, Advanced Research at Michelin, Ms. Portigliatti will join the Group Executive Committee as Executive Vice President, High-Tech Materials on July 1, 2021. Michelin currently has outstanding expertise in high-tech materials, one of its four areas of growth.

June 30, 2021 – Michelin launches "WATEA by Michelin" to support its corporate customers in transitioning to zero-emission mobility.

Based on an all-inclusive monthly subscription and a palette of more than 80 services, the new Michelin solution will facilitate access to charging stations and make it easier to manage battery-powered and, in the near future, hydrogen-powered commercial EV fleets. This unprecedented, all-in-one solution is a further illustration of the Group's expertise in services, one of its major new growth areas.

February 23, 2021 – In 2050, MICHELIN tires will be 100% sustainable.

MICHELIN is ambitiously committed to making its tires entirely from renewable, recycled, biosourced or otherwise sustainable materials by 2050, thanks to its powerful research & development capabilities, materials technology expertise and open-innovation strategy.

February 25, 2021 – Michelin launches the MICHELIN Pilot Sport EV, the first tire in the Pilot Sport family purpose-engineered for electric sports cars.

Michelin is currently the only tiremaker serving both the Original equipment and Replacement electric sports car tire markets. Designed in close collaboration with Tesla, the 20-inch MICHELIN Pilot Sport EV has been type-approved for the Tesla Model Y. By 2024, Michelin expects to increase its sales in this high-growth market by a factor of eight.

March 10, 2021 – Michelin launches its new MICHELIN Wild Enduro Racing Line mountain bike tire.

The new line has already demonstrated its capabilities with wins in some of the world's most challenging races, including two Elite World Enduro Championship titles with Sam Hill; one U21 World Enduro Championship title with Elliot Heap; and two Masters World Enduro Championship titles with Karim Amour.

April 15, 2021 – ProovStation partners with Michelin to reduce the time and costs of tire inspection.

The solution developed by ProovStation, the European leader in automated inspection, has been enhanced by Michelin's expertise thanks to MICHELIN QuickScan technology, which can check tire wear automatically and instantaneously with millimeter precision. In addition to its technology, which is protected by more than 15 patents, Michelin is contributing its experience in analyzing tire data using its proprietary artificial intelligence algorithms.

(1) Corporate Social Responsibility.

April 23, 2021 – Michelin take a major step with Carbios towards developing 100% sustainable tires.

Michelin has successfully validated the use of Carbios' enzymatic recycling technology for PET(1) plastic waste in its tires. This takes the Group one step closer to fulfilling its 2050 ambition of manufacturing tires that are 100% sustainable, i.e., made entirely of renewable, recycled or otherwise sustainable materials, with an interim goal of 40% by 2030.

April 23, 2021 – Harley-Davidson and Michelin pursue their long-standing collaboration.

Michelin has custom-designed the MICHELIN Scorcher Adventure tire for the Harley-Davidson Pan America™ 1250 motorcycle. Over the past 13 years, Michelin has nurtured a close working relationship with Harley-Davidson, based on performance, quality and innovation, and today, its tires equip more than 40% of the motorcycles manufactured by the American brand.

April 29, 2021 – Michelin launches new tire lines developed entirely virtually for the headlining Le Mans Hypercar class.

For the 2021 FIA World Endurance Championship campaign, Michelin Motorsport teams developed new tire ranges with the support of innovative development processes, based solely on computers and simulators. This was a further opportunity for the Group to showcase its pioneering spirit and ability to design tires that deliver consistently high performance from the start to finish of every stint.

April 30, 2021 – Michelin designs the MICHELIN X Incity EV Z tire, the first MICHELIN range specifically engineered for electric buses.

The new range will support the transition towards cleaner, more efficient and longer range electric mobility solutions. On April 8, Michelin presented Michelin in Motion, its "All Sustainable" strategy for 2030, which singled out the EV market as a "genuine growth opportunity and energy transition accelerator."

May 11, 2021 – Michelin presents its International Mobility Award at the Blue Ocean Awards ceremony.

The International Mobility Award honored Tarmac Technologies and SUN Mobility, two startups that are contributing to the development of mobility. Presented as part of the Blue Ocean Awards, of which Michelin is a preferred partner, the Award demonstrates the Group's commitment to leveraging open innovation to become a major player in connected mobility.

May 19, 2021 – The new MICHELIN Guide – Tablet Hotels app wins its first award.

The MICHELIN Guide and Tablet Hotels have combined their expertise to develop a new global app that provides access to all the selections of their inspectors and experts in more than 30 destinations in the Americas, Europe, and Asia. The application alone contains nearly 20,000 curated addresses. The Webby Awards, which honor excellence on the Internet, awarded it the "Webby Honoree" distinction in the "Apps and Software" category.

May 27, 2021 – The new MICHELIN TRAILXBIB tire increases farm yields.

Designed in association with farmers in a number of countries, the MICHELIN TRAILXBIB tire incorporates the innovative MICHELIN Ultraflex technology that improves farm yields by reducing soil compaction. In addition, the MICHELIN TRAILXBIB range is compatible with remote inflation systems, which enable operators to easily adjust tire pressure in real time according to the driving surface or soil conditions.

May 28, 2021 – AddUp takes metal 3D printing to the next level.

AddUp, the joint venture created by Michelin and Fives in 2016 and specialized in metal 3D printing, has developed a new generation of machines with promising features for industry. Michelin believes metal 3D printing is one of the growth drivers in the high-tech materials field. The new-generation machines support Michelin's ambitions to expand its operations beyond tires.

June 1, 2021 – 2021 Movin'On: Michelin presents two innovations to accelerate the development of sustainable mobility.

The WISAMO project, an automated, telescopic, inflatable wing sail system that will help to decarbonize maritime shipping, and a high-performance racing tire containing 46% sustainable materials offer further tangible, real-world proof of the Group's determination to make mobility increasingly sustainable. The innovations also demonstrate Michelin's commitment to basing a portion of its growth on the development of new business activities, while showcasing its ability to incorporate an everhigher percentage of sustainable materials into its products without compromising on their performance. Michelin expects to use 100% sustainable materials in all its tires by 2050.

June 17, 2021 – KRISTAL.aero and Michelin launch KRISTAL.air, a mobile app for everyone who flies light aircraft.

The new app expresses Michelin Aviation's commitment to fostering connected mobility, safe flying and closer customer relationships. It is also compatible with the Group's "All Sustainable" vision. Pilots can now optimize their flights, in particular by enhancing the quality of their landings and reducing their environmental impact with greater fuel efficiency and lower CO2 emissions.

⁽¹⁾ Polyethylene terephthalate (PET) is a plastic that is currently oil-based, with its two monomers, ethylene glycol and terephthalic acid, being derived from petroleum. It is the raw material for one of the main polyester fibers used in tire reinforcements.

June 23, 2021 – Michelin designs the new MICHELIN X AGVEV, the first tire specifically engineered for automatic guided vehicles (AGVs).

Today, most AGVs operating in port facilities are electrically powered. The EV-marked MICHELIN X AGVEV is the first port tire that helps to cut CO2 emissions and increase an electric vehicle's battery life, thanks to its very low rolling resistance.

June 30, 2021 – Michelin introduces the new MICHELIN X® MULTI GRIP™ line of truck tires built to perform in extreme winter conditions.

Designed to ensure maximum safety and mobility in extreme winter conditions and on wet roads, the new MICHELIN X® MULTI GRIP™ tire also helps to make overland shipping more sustainable, in particular by reducing CO2 emissions per kilometer driven. Regrooving and retreading also increase the useful service lives of the entire line-up.

04 Condensed interim consolidated financial statements

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS – SIX MONTHS ENDED JUNE 30, 2021 108

Consolidated income statement	109
Consolidated statement of comprehensive income	109
Consolidated statement of financial position	110
Consolidated statement of changes in equity	111
Consolidated statement of cash flows	112
Notes to the condensed interim consolidated financial statements	113

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS – SIX MONTHS ENDED JUNE 30, 2021

DETAILED SUMMARY OF THE NOTES TO THE FINANCIAL STATEMENTS

NOTE 1	General Information	113
NOTE 2	Basis of preparation	113
NOTE 3	Condensed segment reporting	118
NOTE 4	Other operating income and expenses	119
NOTE 5	Cost of net debt and other financial
	income and expenses	119
NOTE 6	Income tax	120
NOTE 7	Earnings per share	121
NOTE 8	Goodwill	121
NOTE 9	Equity-accounted companies and related-party transactions	122

NOTE 10	Inventories	123
NOTE 11	Trade receivables	124
NOTE 12	Financial instruments	124
NOTE 13	Share capital and share premiums	127
NOTE 14	Reserves	128
NOTE 15	Employee benefit obligations	130
NOTE 16	Provisions and other non-current liabilities	131
NOTE 17	Notes to the statement of cash flows	132
NOTE 18	Litigation and contingent liabilities	133
NOTE 19	Events after the reporting date	133

(in € millions, except per share data)	Note	First-half 2021	First-half 2020(1)
Sales	3	11,192	9,357
Cost of sales		(7,807)	(7,087)
Gross income		3,385	2,270
Sales and marketing expenses(1)		(531)	(519)
Research and development expenses		(328)	(311)
General and administrative expenses(1)		(1,085)	(1,030)
Segment other income and expenses		(20)	(100)
Segment operating income	3	1,421	310
Other operating income and expenses	4	16	(133)
Operating income		1,437	177
Cost of net debt	5	(91)	(160)
Other financial income and expenses	5	1	(3)
Net interest on employee benefit obligations	15	(19)	(28)
Share of profit/(loss) from equity-accounted companies	9	(32)	(44)
Income/(loss) before taxes		1,296	(58)
Income tax	6	(264)	(79)
NET INCOME/(LOSS)		1,032	(137)
▶ Attributable to the shareholders of the Company		1,030	(134)
▶ Attributable to the non-controlling interests		2	(3)
EARNINGS PER SHARE (in €)	7
▶ Basic		5.74	(0.75)
▶ Diluted		5.70	(0.75)

(1) The first-half 2020 figures have been restated for comparison purposes (see note 2.8 to the consolidated financial statements).

Notes 1 to 19 are an integral part of the condensed interim consolidated financial statements.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Note (in € millions)	First-half 2021	First-half 2020
Net income/(loss)	1,032	(137)
Post-employment benefits 15	254	79
Tax effect – Post-employment benefits	(67)	(11)
Equity instruments at fair value through OCI – changes in fair value	4	5
Other comprehensive income that will not be reclassified
to the income statement	191	73
Cash flow hedges – changes in fair value	(5)	27
Currency translation differences	337	(492)
Other	2	(8)
Other comprehensive income/(loss) that may be reclassified
to the income statement	334	(473)
Other comprehensive income/(loss)	525	(400)
TOTAL COMPREHENSIVE INCOME/(LOSS)	1,557	(537)
▶ Attributable to the shareholders of the Company	1,556	(534)
▶ Attributable to the non-controlling interests	1	(3)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Note (in € millions)		June 30, 2021 December 31, 2020
Goodwill 8	2,154	2,136
Intangible assets	1,818	1,980
Property, plant and equipment (PP&E)	10,713	10,821
Right-of-use assets	1,052	1,083
Non-current financial assets and other non-current assets	1,165	865
Investments in equity-accounted companies 9	1,081	941
Deferred tax assets 6	693	729
Non-current assets	18,676	18,555
Inventories 10	4,659	3,959
Trade receivables 11	3,543	3,018
Current financial assets	451	429
Other current assets	1,039	929
Cash and cash equivalents 12	3,812	4,747
Current assets	13,504	13,082
TOTAL ASSETS	32,180	31,637
Share capital 13	357	357
Share premiums 13	2,746	2,746
Reserves 14	10,682	9,530
Non-controlling interests	(1)	(2)
Total equity	13,784	12,631
Non-current financial liabilities 12	5,354	6,169
Non-current lease liabilities	755	801
Provisions for employee benefit obligations 15	3,408	3,700
Provisions and other non-current liabilities 16	768	775
Deferred tax liabilities 6	421	425
Non-current liabilities	10,706	11,870
Current financial liabilities 12	1,653	1,546
Current lease liabilities	229	222
Trade payables	2,351	2,291
Trade payables under reverse factoring agreements	506	437
Provisions and other current liabilities 16	2,951	2,640
Current liabilities	7,690	7,136
TOTAL EQUITY AND LIABILITIES	32,180	31,637

(in € millions)	Share capital (note 13)	Share premiums (note 13)	Reserves (note 14)	Non-controlling interests	Total equity
At January 1, 2020	357	2,789	10,080	3	13,229
Net income/(loss)	-	-	(134)	(3)	(137)
Other comprehensive income/(loss)	-	-	(400)	-	(400)
Total comprehensive income/(loss)	-	-	(534)	(3)	(537)
Issuance of shares	-	1	-	-	1
Cancellation of shares	-	-	-	-	-
Dividends and other appropriations	-	-	(368)	-	(368)
Share buybacks	-	-	(99)	-	(99)
Other	-	-	13	-	13
At June 30, 2020	357	2,790	9,092	-	12,239
Net income/(loss)	-	-	766	(4)	762
Other comprehensive income/(loss)	-	-	(430)	1	(429)
Total comprehensive income/(loss)	-	-	336	(3)	333
Issuance of shares	1	53	-	-	54
Cancellation of shares	(2)	(97)	99	-	-
Dividends and other appropriations	-	-	-	-	-
Share buybacks	-	-	-	-	-
Other	1	-	3	1	5
At December 31, 2020	357	2,746	9,530	(2)	12,631
Net income/(loss)	-	-	1,030	2	1,032
Other comprehensive income/(loss)	-	-	526	(1)	525
Total comprehensive income/(loss)	-	-	1,556	1	1,557
Issuance of shares	-	-	-	-	-
Cancellation of shares	-	-	-	-	-
Dividends and other appropriations	-	-	(414)	-	(414)
Share buybacks	-	-	(1)	-	(1)
Sales of treasury shares	-	-	1	-	1
Other	-	-	10	-	10
AT JUNE 30, 2021	357	2,746	10,682	(1)	13,784

CONSOLIDATED STATEMENT OF CASH FLOWS

(in € millions)	Note	First-half 2021	First-half 2020
Net income/(loss)		1,032	(137)
Adjustments
▶ Cost of net debt	5	91	160
▶ Other financial income and expenses	5	(1)	3
▶ Net interest on employee benefit obligations	15	19	28
▶ Income tax	6	264	79
▶ Amortization, depreciation and impairment of intangible assets and PP&E		856	882
▶ Other operating income and expenses	4	(16)	133
▶ Share of profit from equity-accounted companies	9	32	44
Segment EBITDA		2,277	1,192
Other operating income and expenses (cash) and change in provisions	17	(101)	(199)
Interest and other financial income and expenses received and paid, net	17	(61)	(137)
Income tax paid		(278)	(129)
Change in working capital, net of impairment	17	(833)	(237)
Net cash from operating activities		1,004	490
Purchases of intangible assets and PP&E	17	(654)	(769)
Proceeds from sales of intangible assets and PP&E		17	24
Equity investments in consolidated companies, net of cash acquired		(4)	(33)
Disposals of equity investments in consolidated companies, net of cash sold		(3)	(1)
Purchases of equity instruments at fair value		(10)	(10)
Disposals of equity instruments at fair value		1	3
Cash flows relating to other financial assets	17	(3)	(46)
Net cash from/(used in) investing activities		(656)	(832)
Proceeds from issuance of shares	13	-	1
Dividends paid to the shareholders of the Company	13	(410)	-
Cash flows relating to financial liabilities	17	(891)	1,727
Share buybacks	14	-	(20)
Other		9	(4)
Net cash from/(used in) financing activities		(1,292)	1,704
Effect of changes in exchange rates		9	(19)
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS		(935)	1,343
Cash and cash equivalents at January 1		4,747	1,466
Cash and cash equivalents at June 30		3,812	2,809

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 GENERAL INFORMATION

Compagnie Générale des Établissements Michelin (CGEM or the "Company") and its subsidiaries (together "the Group") design, manufacture and market tires throughout the world. The Group also provides its customers with tire- and vehiclerelated services and solutions, mobility experiences and expertise in high-tech materials.

The Company is a partnership limited by shares (société en commandite par actions) incorporated in Clermont-Ferrand (France).

NOTE 2 BASIS OF PREPARATION

2.1 Statement of compliance

The condensed interim consolidated financial statements have been prepared in accordance with IAS 34 "Interim Financial Reporting". They do not include all the information required for full annual financial statements and should be read in conjunction with the Group's consolidated financial statements for the year ended December 31, 2020, which were prepared in accordance with the International Financial Reporting Standards (IFRSs) adopted by the European Union as of the reporting date and applicable to the period then ended.

2.2 Accounting policies

The accounting policies applied in the preparation of these condensed interim consolidated financial statements are consistent with those applied by the Group in its consolidated financial statements for the year ended December 31, 2020.

The net post-retirement benefit obligation and the related net provision are measured based on the latest actuarial valuations available at the end of the previous period. For the main benefit plans (United States, Canada, United Kingdom, Germany and France), the actuarial assumptions are reviewed and the main assumptions are adjusted in the event of a material change during the six-month period. For these benefit plans, the fair value of the plan assets is measured at the interim reporting date.

The Company is listed on Euronext Paris (Eurolist Compartment A). After a review by the Supervisory Board, these condensed interim consolidated financial statements were authorized for issue by the Managing Chairman on July 23, 2021.

Except as otherwise stated, all amounts are presented in millions of euros (€ millions).

2.3 New standards, amendments to existing standards and interpretations effective from January 1, 2021

The following amendments to IFRSs are effective from January 1, 2021; they have no material impact for the Group:

Amendments to IAS 39 – IFRS 4 – IFRS 7 – IFRS 9 – IFRS 16 – Interest Rate Benchmark Reform

(Phase 2)

The Phase 2 amendments address issues that might affect financial reporting during the reform of an interest rate benchmark, including the effects of changes to contractual cash flows or hedging relationships arising from the replacement of an interest rate benchmark with an alternative benchmark rate (replacement issues).

No hedging relationships have been identified by the Group that would be affected by the replacement of an interest rate benchmark. The impact of applying new interest rates to leases, loans, borrowings and derivative instruments not qualifying for hedge accounting will not be material.

The amendments to other IFRSs that are effective from January 1, 2021 have no material impact on the consolidated financial statements.

2.4 New standards, amendments to existing standards and interpretations that are not yet effective

04

The following amendments to IFRSs which are not applicable at June 30, 2021 are not expected to have a material impact on the consolidated financial statements at their application date:

Amendment to IAS 1 – Presentation of Financial Statements – Classification of Liabilities as Current or Non-current

This amendment clarifies the principles applied to classify liabilities as current or non-current. It is applicable from January 1, 2022.

Amendment to IAS 16 – Property, Plant and Equipment – Proceeds Before Intended Use

This amendment prohibits a company from deducting from the cost of property, plant and equipment amounts received from selling items produced while the company is preparing the asset for its intended use. Instead, the proceeds from selling such items, and the cost of producing them must be recognized in profit or loss. The amendment is applicable from January 1, 2022.

Amendment to IAS 37 – Provisions, Contingent Liabilities and Contingent Assets – Onerous Contracts, Cost of Fulfilling a Contract

This amendment specifies the costs to be taken into account when assessing whether a contract will be loss-making. It is applicable from January 1, 2022.

Amendment to IAS 41 – Biological Transformation of Biological Assets

The amendment removes the requirement to exclude cash flows from taxation when measuring the fair value of biological assets using a discounting method. It aligns the fair value measurement requirements in IAS 41 with those in IFRS 13. The amendment is applicable from January 1, 2022.

Amendments to IAS 12

In some circumstances, entities may be exempt from the requirement to recognize a deferred tax on initial recognition of an asset and liability.

Up to now, it was not clear whether the exemption applied to transactions for which an entity recognizes both an asset and a liability such as leases and decommissioning obligations.

The amendments make it clear that the exemption does not apply in these cases and that entities are required to recognize a deferred tax on these transactions.

The amendments will be effective for annual periods beginning on or after January 1, 2023 and will apply to qualifying transactions occurring as from the beginning of the earliest comparative period presented. The impact on the consolidated financial statements of applying this amendment is currently being assessed.

Amendment to IFRS 17 – Insurance Contracts – Recognition, Measurement and Presentation

The purpose of this amendment is to ensure that an entity provides relevant information that faithfully represents the contracts. The amendment is applicable from January 1, 2023.

Amendments to IAS 1

These amendments require an entity to disclose its material accounting policy information rather than its significant accounting policies. The amendments state that accounting policy information is material if users of an entity's financial statements would need it to understand other material information in the financial statements. The amendments are effective for annual periods beginning on or after January 1, 2023.

Amendments to IAS 8

These amendments are designed to help entities distinguish between changes in accounting policies and accounting estimates. Accounting estimates are defined as monetary amounts in financial statements that are subject to measurement uncertainty. The amendments will be applicable prospectively for annual periods beginning on or after January 1, 2023.

IFRS 16 – Covid-19 Related Rent Concessions Beyond June 30, 2021

Recent amendments have extended by one year the practical expedient set out in the amendment to IFRS 16 – Covid-19 Related Rent Concessions published in May 2020. Consequently, lessees may now apply this expedient to rent concessions granted up until June 30, 2022 (versus June 30, 2021 previously). The concession may consist of rent relief or a reduction in the rent originally due. Lessees may choose to account for the rent concession as variable lease payments recognized directly in the income statement of the period(s) in which the event or condition that triggers the reduced payment occurs, rather than treating it as a lease modification with the resulting obligation to remeasure the lease liability based on the revised consideration using a revised discount rate. This amendment, which had not yet been approved by the European Union as of June 30, 2021, will not have a material impact on the Group's consolidated financial statements.

There are no new standards, updates and interpretations published but not yet effective whose impact could be material for the Group.

The preparation of condensed interim consolidated financial statements in accordance with IFRS requires that management uses assumptions and estimates to calculate the value of assets and liabilities at the date of the consolidated statement of financial position and the amount of income and expenses for the reporting period. Actual results could differ from those estimates.

The main sources of uncertainty relating to key assumptions and judgments concern impairment of non-financial assets, employee

2.6 Changes in the scope of consolidation

2.6.1 Transactions in the first half of 2021

Solesis Inc. change of consolidation method

On May 28, 2021, Michelin and Altaris announced the signing of a partnership agreement whereby Altaris would become a shareholder of Solesis, a Michelin subsidiary specializing in biomaterials for the healthcare industry.

The partnership agreement has three components:

• ► Acquisition of a 51% stake in Solesis by Altaris;
• ► Setup of a governance system that will enable the two Solesis shareholders to support the business' development and expansion;
• ► A research and development partnership between Michelin and Solesis to continue co-developing biopolymers focused on the intersection of polymer science and biology.

As a result of this agreement, the Solesis subsidiaries that were previously fully consolidated by Michelin have been accounted for by the equity method with effect from May 28, 2021.

benefit obligations, income taxes, goodwill, intangible assets acquired in a business combination and the estimated useful life of such assets, and the definition of the enforceable period of a lease contract.

In light of the Covid-19 crisis, the Group expects business to return to 2019 levels in 2022.

The consideration for the sale of 51% of Solesis' net assets, based on an enterprise value of \$475 million, is presented as follows in the consolidated statement of financial position:

• ► 49% retained interest recognized under "Investments in equity-accounted companies" for an amount of €145 million. The fair value measurement of the assets acquired and liabilities assumed by the joint venture is currently in progress and will be completed within 12 months of the date of signature of the partnership agreement.
• ► Preferred units, considered in substance as a financial asset measured at fair value through profit or loss, presented under "Non-current financial assets and other non-current assets" for €227 million.

The €113 million gain realized on the disposal is presented under "Other operating income and expenses" for first-half 2021 (note 4).

The transaction has had no effect on the Group's cash position as the cash contributed by Altaris has been retained in the accounts of the Solesis joint venture to fund its growth. For this reason, the transaction qualifies as a tax-exempt reorganization under US tax rules. No deferred tax liability has been recognized because the Group controls the timing of any possible sale of its investment. As of the reporting date, the Group had no plans to sell the investment.

The effects of the transaction on the transaction-date consolidated statement of financial position are as follows:

(in € millions)	At the transaction date
Investments in equity-accounted companies	145
Other non-current financial assets and other non-current assets	227
Net assets sold	(259)
DISPOSAL GAIN	113

Details of the net assets sold are presented in the table below:

(in € millions)	Net assets sold
Goodwill	(53)
Intangible assets	(198)
Property, plant and equipment (PP&E)	(41)
Non-current assets	(292)
Inventories	(11)
Trade receivables	(14)
Cash and cash equivalents	(1)
Current assets	(26)
TOTAL ASSETS	(318)
Net assets	(259)
Non-current financial liabilities	-
Non-current lease liabilities	(3)
Deferred tax liabilities	(47)
Non-current liabilities	(50)
Trade payables	(3)
Provisions and other current liabilities	(6)
Current liabilities	(9)
TOTAL EQUITY AND LIABILITIES	(318)

2.6.2 Transactions in the first half of 2020

During the first half of 2020, the Group completed several acquisitions that were individually not material, representing a total investment of €28 million.

2.7 Seasonality

Cash and cash equivalents at June 30, 2021 traditionally reflect the increase in working capital requirement and the payment of the dividend during the first half (note 13).

2.8 Restatement of comparative information

The costs of the Euromaster distribution network's support functions have been reclassified from "Sales and marketing expenses" to "General and administrative expenses" in the consolidated income statement, in order to track these expenses more effectively.

For comparison purposes, an amount of €58 million has been reclassified from "Sales and marketing expenses" to "General and administrative expenses" in the consolidated income statement for first-half 2020.

The effects of the restatement are presented in the table below:

	First-half 2020		First-half 2020
(in € millions, except per share data)	as reported	Reclassification	restated
Sales	9,357	-	9,357
Cost of sales	(7,087)	-	(7,087)
Gross income	2,270	-	2,270
Sales and marketing expenses	(577)	58	(519)
Research and development expenses	(311)	-	(311)
General and administrative expenses	(972)	(58)	(1,030)
Segment other income and expenses	(100)	-	(100)
Segment operating income	310	-	310
Other operating income and expenses	(133)	-	(133)
Operating income	177	-	177
Cost of net debt	(160)	-	(160)
Other financial income and expenses	(3)	-	(3)
Net interest on employee benefit obligations	(28)	-	(28)
Share of profit/(loss) from equity-accounted companies	(44)	-	(44)
Income/(loss) before taxes	(58)	-	(58)
Income tax	(79)	-	(79)
NET INCOME/(LOSS)	(137)	-	(137)
▶ Attributable to the shareholders of the Company	(134)	-	(134)
▶ Attributable to the non-controlling interests	(3)	-	(3)
EARNINGS PER SHARE (in €)
▶ Basic	(0.75)	-	(0.75)
▶ Diluted	(0.75)	-	(0.75)

NOTE 3 CONDENSED SEGMENT REPORTING

Segment information is presented according to the following three operating segments:

► Automotive and related distribution;

04

• ► Road transportation and related distribution;
• ► Specialty businesses and related distribution.

Segment information is as follows:

The Specialty businesses include the Mining, Beyond Road, Twowheel and Aircraft tire activities as well as the Conveyor Belts and High-Tech Materials activities.

The operating segments' performance is measured mainly at the level of sales and segment operating income, according to the same measurement principles used in the consolidated income statement.

	First-half 2021				First-half 2020
(in € millions)	Automotive and related distribution	Road transportation and related distribution	Specialty businesses and related distribution	Total	Automotive and related distribution	Road transportation and related distribution	Specialty businesses and related distribution	Total
Sales	5,562	2,897	2,733	11,192	4,394	2,411	2,552	9,357
Segment operating income/(loss)	730	286	405	1,421	(35)	(30)	375	310
As a percentage of sales	13.1%	9.9%	14.8%	12.7%	-0.8%	-1.3%	14.7%	3.3%

Segment assets are as follows:

		June 30, 2021				December 31, 2020
(in € millions)	Automotive and related distribution	Road transportation and related distribution	Specialty businesses and related distribution	Total	Automotive and related distribution	Road transportation and related distribution	Specialty businesses and related distribution	Total
Segment assets	10,089	5,568	6,477	22,134	9,695	5,416	6,409	21,520

Segment assets consist of goodwill and intangible assets, property, plant and equipment, finished product inventories, and trade receivables. The amounts reported to the Group's management in respect of operating segment assets are measured in a manner consistent with the consolidated financial statements.

No liabilities are allocated to the operating segments in the internal reports submitted to the Managing Chairman.

Corporate assets are allocated to each segment using allocation keys for each type of asset, mainly net sales by segment.

Geographic information breaks down as follows by segment:

	First-half 2021					First-half 2020
(in € millions)	Europe	North America	Other	Total	Europe	North America	Other	Total
Sales	4,248	3,813	3,131	11,192	3,382	3,214	2,761	9,357

Sales by geographic area are based on the location of the customer.

Net sales in France for the six months ended June 30, 2021 amounted to €980 million (2020: €768 million).

The Group derived 95.4% of its first-half 2021 sales (first-half 2020: 94.8%) from tire sales and sales related to the supply of tires to the original equipment or replacement market, plus sales of Fenner conveyor belts. These sales totaled €10,678 million (first-half 2020: €8,871 million). Sales are recognized at the point in time when control of the goods is transferred to the customer. Revenue recognized in first-half 2021 deriving from commercial fleet tire management contracts and from contracts for the supply of telematics services, each of which being a performance obligation satisfied over time, amounts to €297 million, representing 2.7% of total sales (firsthalf 2020: €274 million and 2.9%).

(in € millions)	First-half 2021	First-half 2020
Amortization of trademarks and customer relationships acquired	(41)	(45)
Reorganizations and adaptation of activities	(28)	(23)
Impairment of non-current assets	(21)	(49)
Employee benefit obligations	(9)	(8)
Other	115	(8)
OTHER OPERATING INCOME AND EXPENSES	16	(133)

4.1 First-half 2021

As part of the initiatives to improve the competitiveness of its manufacturing and office-based activities, on January 6, 2021 the Group announced the launch of a reinforced simplification and competitiveness plan to significantly improve the agility and overall performance of its operations in France.

The three-year plan will be supported by a broad coconstruction and social dialogue process.

The framework agreement signed on April 27, 2021 introduced support measures for Michelin employees during the three years of the simplification and competitiveness plan, along with a set of commitments to employees who are planning to continue their careers with the company. In order to implement the voluntary early retirement and voluntary outplacement measures, a mutually agreed severance package (Collective Settlement Agreement) will be negotiated each year, in 2021, 2022 and 2023.

In June, following the signing of the 2021 Collective Settlement Agreement, a €99 million provision was set aside to cover the cost of the support measures (note 16). At the same time, €87 million was released from the provision booked in prior years for post-employment benefit obligations towards the employees concerned (note 15). The net cost of €12 million is reported under "Reorganizations and adaptation of activities".

The gain resulting from the change of consolidation method applied to Solesis (note 2.6.1) is recognized under "Other" for €113 million.

4.2 First-half 2020

"Impairment of non-current assets" corresponds mainly to writedowns of the intangible assets of the Tablet CGU for €39 million.

NOTE 5 COST OF NET DEBT AND OTHER FINANCIAL INCOME AND EXPENSES

Cost of net debt and other financial income and expenses are broken down in the table below:

(in € millions)	First-half 2021	First-half 2020
Interest expense	(85)	(111)
Interest expense on lease liabilities	(15)	(18)
Interest income on cash, cash equivalents and cash management financial assets	(6)	-
Interest rate derivatives	18	(33)
Fees on credit lines	(4)	(2)
Capitalized borrowing costs	1	4
COST OF NET DEBT	(91)	(160)
Net income from financial assets (other than cash and cash equivalents and cash management
financial assets)	7	9
Currency remeasurement (including currency derivatives)	(4)	(11)
Other	(2)	(1)
OTHER FINANCIAL INCOME AND EXPENSES	1	(3)

NOTE 6 INCOME TAX

6.1 Income tax expense

04

(in € millions)	First-half 2021	First-half 2020
Current tax expense	(258)	(96)
Deferred tax benefit/(expense)	(6)	17
INCOME TAX	(264)	(79)

Current tax includes €8 million of withholding tax on royalties, interest and retained earnings distributed between Group companies (2020: €19 million).

The Group's effective tax rate for first-half 2021 is 20.4%.

The Group has operations in various countries that have different tax laws and rates. The weighted average domestic tax rate of Group companies may therefore vary from year to year depending on the relative size of taxable incomes. Effective tax rates may differ from theoretical rates, particularly due to

6.2 Tax audits in Germany

Following a tax audit covering the years 2005 to 2009, a German subsidiary was notified in 2018 of a €382 million reassessment of its corporate income tax base determined by estimating its taxable income for the audited period by reference to the Group's average profit margin. The reassessment includes an amount of €298 million corresponding to the effects on the subsidiary of the Group's transfer pricing policy, which was challenged by the tax administration.

The Group has challenged all of the German tax administration's arguments.

On July 17, 2018, the Group initiated the following procedures with the German tax authorities:

• ► an application to defer payment of the tax deficiency and late interest while the dispute procedure was in progress; as a result of this application, the payments made were not material;
• ► an appeal to a higher authority challenging the tax authorities' methodology, which is based on the Group's average profit margin.

unrecognized deferred tax assets, withholding taxes, tax credits and other taxes not based on income. The untaxed capital gain recorded in first-half 2021 on creation of the Solesis Inc. joint venture (see note 2.6.1) had a positive impact on the Group's effective tax rate.

The utilization of deferred tax assets is periodically reviewed at the tax entity level and may lead to the recognition of previously unrecognized deferred tax assets. Changes in deferred taxes in first-half 2021 were not material.

On December 16, 2019, the Group filed a Mutual Agreement Procedure (MAP) under the EU Arbitration Convention and the respective Double Tax Treaties, for the total reassessment amounting to €382 million.

In November 2020, the reassessment for the period 2005-2009 was revised downwards to €96 million from €382 million previously. The appeal lodged with a higher authority is still pending, based on the revised €96 million reassessment of the corporate income tax base.

In 2016, a second tax audit covering the years 2010 to 2014 was launched. As of June 30, 2021, the Group had yet not received any notice of reassessment in this respect.

In first-half 2021, the Group maintained its appeal concerning the 2005-2009 reassessments but decided to settle the tax claimed on the revised €96 million tax base reassessment in order to avoid the accrual of further late interest. The tax audit covering the years 2010 to 2014 is still in progress.

At June 30, 2021, the Group considers that there are no grounds for adjusting the provision booked at end-2020.

NOTE 7 EARNINGS PER SHARE

Components of the basic and diluted earnings per share calculations are presented in the table below:

	First-half 2021	First-half 2020
Net income/(loss) (in € millions), excluding non-controlling interests	1,030	(134)
▶ Less, estimated General Partners' profit shares	(6)	-
Net income/(loss) attributable to the shareholders of the Company used to calculate basic earnings per share	1,024	(134)
Weighted average number of shares outstanding (thousands of shares) used to calculate basic earnings per share	178,344	178,504
▶ Plus, adjustment for stock option plans	10	-
▶ Plus, adjustment for performance shares	1,242	-
Weighted average number of shares used to calculate diluted earnings per share	179,596	178,504
EARNINGS PER SHARE (in €)
▶ Basic	5.74	(0.75)
▶ Diluted	5.70	(0.75)

Diluted earnings per share are calculated by adjusting net income attributable to shareholders and the weighted average number of shares outstanding to assume conversion of all dilutive potential shares. The Company has two types of financial instruments which are potentially dilutive: stock options and performance shares.

All of the outstanding stock options were dilutive at June 30, 2021 in light of Michelin's stock market performance in the first half of the year. Performance shares are dilutive by definition.

At June 30, 2020, in light of the net loss for the period, all outstanding stock options (12,787 potentially dilutive shares) and performance share rights (841,978 potentially dilutive shares) were anti-dilutive and were therefore excluded from the calculation of diluted earnings per share.

NOTE 8 GOODWILL

At June 30, 2021, goodwill allocated to the CGUs or groups of CGUs breaks down as follows:

(in € millions)	June 30, 2021	December 31, 2020
Passenger car tires – global brands CGU group	359	358
Passenger car tires – regional brands CGU	155	150
Light truck and Truck tires CGU group	596	573
Mining CGU group	255	241
Two-wheel tires CGU	19	18
Beyond Road tires CGU	656	637
High-Tech Materials CGU group	114	159
GOODWILL	2,154	2,136

Excluding the currency effect, the decline in goodwill in first-half 2021 mainly concerned Solesis for €53 million (note 2.6.1).

The CGUs' financial performance is assessed by taking into account changes in the global health situation. The Group expects to return to 2019 activity levels in 2022.

At June 30, 2021, there were no indicators of impairment of goodwill allocated to any Cash Generating Units (CGUs) or groups of CGUs requiring the implementation of specific impairment tests.

NOTE 9 EQUITY-ACCOUNTED COMPANIES AND RELATED-PARTY TRANSACTIONS

9.1 Investments in equity-accounted companies

Changes in investments in equity-accounted companies are as follows:

(in € millions)	Investments in associates	Investments in joint ventures	Total investments in equity-accounted companies
At January 1, 2020	211	876	1,087
Share of profit/(loss) from equity-accounted companies	(14)	(59)	(73)
Impairment	(38)	-	(38)
Dividends	(6)	-	(6)
Change in scope of consolidation/capital increases	2	28	30
Currency translation differences	(6)	(52)	(58)
Other/reclassifications	(5)	4	(1)
At December 31, 2020	144	797	941
Share of profit/(loss) from equity-accounted companies	2	(9)	(7)
Impairment	(4)	(21)	(25)
Dividends	(1)	-	(1)
Change in scope of consolidation/capital increases	-	146	146
Currency translation differences	-	20	20
Other/reclassifications	-	7	7
AT JUNE 30, 2021	141	940	1,081

There were no material new transactions between related parties during the first half of 2021 or other material changes in the nature of related-party transactions described in the notes to the 2020 consolidated financial statements.

The effect of changes in scope of consolidation corresponds mainly to the use of the equity method to account for Solesis (note 2.6.1).

Impairment tests carried out during the period led to the recognition of impairment losses of €25 million on companies involved in producing natural rubber.

The main equity-accounted company is TBC (note 9.2). All of the other companies represent less significant investments.

9.2 Joint venture with Sumitomo Corporation of Americas (TBC)

Summarized financial data for the TBC joint venture are set out in the table below:

(in € millions)		June 30, 2021 December 31, 2020
Current assets	1,465	1,396
of which cash and cash equivalents	80	251
Non-current assets	1,676	1,677
of which goodwill	126	127
TOTAL ASSETS	3,141	3,073
Current liabilities	980	902
of which current financial liabilities	138	135
Non-current liabilities	1,139	1,193
of which non-current financial liabilities	1,002	1,068
Equity	1,022	978
TOTAL LIABILITIES AND EQUITY	3,141	3,073

(in € millions)		June 30, 2021 December 31, 2020
Sales	2,036	4,278
Interest income	1	1
Interest expense	(26)	(72)
Depreciation and amortization	(89)	(244)
Income tax	(9)	5
Net loss (a)	13	(39)
Income statement impact of elimination of profit from downstream transactions (net of tax) (b)	(4)	7
Share of net income/(loss) of the joint venture
50% x (a) + (b)	3	(13)

(in € millions)		June 30, 2021 December 31, 2020
Net assets (including goodwill)	1,022	978
Share of net assets (including goodwill) = 50%	511	489
Elimination of profit from downstream transactions (net of tax)	(24)	(19)
Carrying amount of net interest in the joint venture	487	470

In addition, a loan to TBC is included in the Group's non-current financial assets. The amount outstanding on the loan was €127 million as of June 30, 2021, after a \$50 million repayment received from TBC during the period.

NOTE 10 INVENTORIES

Inventories include the following:

(in € millions)		June 30, 2021 December 31, 2020
Raw materials and supplies	1,295	1,066
Work in progress	537	438
Finished goods	2,908	2,541
Total gross inventory	4,740	4,045
Impairment of raw materials and supplies	(25)	(26)
Impairment of work in progress	(1)	(1)
Impairment of finished goods	(54)	(59)
Total impairment	(81)	(86)
NET INVENTORIES	4,659	3,959

NOTE 11 TRADE RECEIVABLES

The carrying amount of trade receivables is analyzed in the table below:

(in € millions)		June 30, 2021 December 31, 2020
Gross trade receivables	3,640	3,126
Impairment	(97)	(108)
TRADE RECEIVABLES	3,543	3,018

All trade receivables are due within 12 months.

Concerning credit risk, if a customer becomes insolvent or files for bankruptcy, it may default on the receivables held by the Group and this may have a negative impact on the Group's income statement.

The Credit Department, which is part of the Group Finance Department, sets the maximum payment terms and customer credit limits to be applied by the operating companies. It manages and controls credit activity, risk and results, and is responsible for credit and collection processes.

NOTE 12 FINANCIAL INSTRUMENTS

12.1 Net debt

Group net debt is analyzed in the table below:

(in € millions)		June 30, 2021 December 31, 2020
Financial liabilities	7,991	8,738
Derivatives recognized as assets	(195)	(153)
Borrowing collaterals	(20)	(22)
Cash management financial assets	(285)	(285)
Cash and cash equivalents	(3,812)	(4,747)
NET DEBT	3,679	3,531

12.2 Financial liabilities

The carrying amount of financial liabilities is presented in the table below:

(in € millions)		June 30, 2021 December 31, 2020
Bonds	5,111	5,867
Loans from financial institutions and other	180	235
Derivative instruments	63	67
Non-current financial liabilities	5,354	6,169
Non-current lease liabilities	755	801
Bonds	877	77
Commercial paper	291	940
Loans from financial institutions and other	395	479
Derivative instruments	90	50
Current financial liabilities	1,653	1,546
Current lease liabilities	229	222
FINANCIAL LIABILITIES	7,991	8,738

The €747 million decrease in financial liabilities primarily reflects the redemption of short-term commercial paper in first-half 2021 for €649 million.

The average remaining maturity of short-term commercial paper outstanding at June 30, 2021 was 1.8 months.

12.3 Liquidity risk

To meet its future cash needs, the Group had the following sources of financing in place as of June 30, 2021:

• ► Cash and cash equivalents for €3,812 million;
• ► Cash management financial assets for €285 million;
• ► A €2,500 million commercial paper program, of which €249 million had been utilized at June 30, 2021;
• ► A \$700 million (€587 million) commercial paper program, of which \$50 million (€42 million) had been utilized at June 30, 2021;
• ► Two €468 million receivables securitization programs that are utilized based on the availability of sufficient receivables of the required quality, with securitization debt at June 30, 2021 amounting to €15 million;
• ► €2,500 million in confirmed, undrawn lines of credit.

12.4 Cash and cash equivalents

(in € millions)		June 30, 2021 December 31, 2020
Money-market funds	2,811	3,516
Bank deposits subject to up to a three-month notice period	768	962
Cash at bank and in hand	233	269
CASH AND CASH EQUIVALENTS	3,812	4,747

The Group is very careful in its choice of banks to manage its cash investments. Cash investments consist of (i) financial instruments that are subject to no risk or an insignificant risk of changes in value purchased from a sufficiently diversified group of leading banks, and (ii) unrestricted units in diversified money market funds or short-term bond funds.

Restricted deposits consist mainly of cash and cash equivalents subject to prudential rules in Ireland specific to captive insurance companies (June 30, 2021: €51 million; December 31, 2020: €50 million).

12.5 Classification of financial assets

Group financial assets break down as follows between the categories "at fair value through profit or loss (FVTPL)", "at fair value through other comprehensive income (FVOCI)" and "at amortized cost" at June 30, 2021:

(in € millions)	FVTPL	FVOCI	Amortized cost	Total
Trade receivables	-	-	3,543	3,543
Current financial assets	92	10	349	451
Cash and cash equivalents	3,044	-	768	3,812
Non-current financial assets	316	292	557	1,165
TOTAL FINANCIAL ASSETS	3,452	302	5,217	8,971

12.6 Fair value of financial instruments

Fair value measurements are disclosed by level in the following fair value measurement hierarchy:

• ► Level 1: quoted prices in active markets. The fair value of financial instruments traded in active markets is based on quoted market prices at the date of the consolidated statement of financial position. These instruments (essentially cash and cash equivalents as well as quoted unconsolidated equity investments) are included in level 1.
• ► Level 2: inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). If all significant inputs required to fair value these instruments are observable, these instruments (essentially derivative instruments) are included in level 2.
• ► Level 3: inputs for assets or liabilities that are not based on observable market data (i.e., unobservable inputs). If one or more of the significant inputs is not based on observable market data, the instrument (essentially non-quoted unconsolidated equity investments) is included in level 3.

The following tables present the Group's financial assets and liabilities measured at fair value at June 30, 2021 and December 31, 2020 by level in the fair value measurement hierarchy:

(in € millions)	Level 1	Level 2	Level 3		June 30, 2021 December 31, 2020
Cash and cash equivalents	3,044	-	-	3,044	3,786
Current financial assets	20	82	-	102	74
Non-current financial assets	54	114	440	608	336
TOTAL ASSETS	3,118	196	440	3,754	4,196
Financial liabilities	-	153	-	153	117
TOTAL LIABILITIES	-	153	-	153	117

There were no material transfers between level 1 and level 2 during first-half 2021.

(in € millions)	Share capital	Share premiums	Total
At January 1, 2020	357	2,789	3,146
Issuance of shares upon exercise of stock options and performance share rights	-	1	1
Cancellation of shares	-	-	-
Other	-	-	-
At June 30, 2020	357	2,790	3,147
Issuance of shares upon exercise of stock options and performance share rights	1	53	54
Cancellation of shares	(2)	(97)	(99)
Other	1	-	1
At December 31, 2020	357	2,746	3,103
Issuance of shares upon exercise of stock options and performance share rights	-	-	-
Cancellation of shares	-	-	-
Other	-	-	-
AT JUNE 30, 2021	357	2,746	3,103

(number of shares)	Shares issued	Treasury shares	Shares outstanding
At January 1, 2020	178,627,555	-	178,627,555
Issuance of shares upon exercise of stock options and performance share rights	13,786	-	13,786
Share buybacks	-	(216,935)	(216,935)
Sales of treasury shares	-	-	-
Cancellation of shares	-	-	-
Other	-	-	-
At June 30, 2020	178,641,341	(216,935)	178,424,406
Issuance of shares upon exercise of stock options and performance share rights	796,285	-	796,285
Share buybacks	-	(880,605)	(880,605)
Sales of treasury shares	-	-	-
Cancellation of shares	(1,097,540)	1,097,540	-
Other	-	-	-
At December 31, 2020	178,340,086	-	178,340,086
Issuance of shares upon exercise of stock options and performance share rights	9,953	-	9,953
Share buybacks	-	(8,032)	(8,032)
Sales of treasury shares	-	8,032	8,032
Cancellation of shares	-	-	-
Other	-	-	-
AT JUNE 30, 2021	178,350,039	-	178,350,039

The shares have a par value of €2 (unchanged from 2020). All outstanding shares are fully paid and registered. Shares held for more than four years have a double voting right.

The dividend approved at the Annual Shareholders Meeting of May 21, 2021 was €2.30 per share (2020: €2.00 per share). The cash-only dividend was paid on May 27, 2021 for a net amount of €410 million (2020: €357 million).

NOTE 14 RESERVES

(in € millions)	Translation reserve	Treasury shares	Other reserves	Retained earnings	Total
At January 1, 2020	(287)	-	78	10,289	10,080
Dividends and other appropriations	-	-	-	(368)	(368)
Share buybacks	-	(99)	-	-	(99)
Sale/cancellation of shares	-	-	-	-	-
Other	-	-	-	13	13
Transactions with the shareholders of the Company	-	(99)	-	(355)	(454)
Net income/(loss) attributable to the shareholders
of the Company	-	-	-	(134)	(134)
Post-employment benefits	-	-	-	79	79
Tax effect – Post-employment benefits	-	-	-	(11)	(11)
Equity instruments at fair value through OCI –
changes in fair value	-	-	5	-	5
Tax effect – equity instruments at fair value through OCI Other	- -	- -	- -	- -	- -
Other comprehensive income/(loss) that will not be reclassified
to the income statement	-	-	5	68	73
Cash flow hedges – changes in fair value	-	-	27	-	27
Currency translation differences	(492)	-	-	-	(492)
Other	-	-	(5)	(3)	(8)
Other comprehensive income/(loss) that may
be reclassified to the income statement	(492)	-	22	(3)	(473)
Total comprehensive income/(loss)	(492)	-	27	(69)	(534)
At June 30, 2020	(779)	(99)	105	9,865	9,092
Dividends and other appropriations	-	-	-	-	-
Share buybacks	-	-	-	-	-
Sale/cancellation of shares	-	99	-	-	99
Other	-	-	-	3	3
Transactions with the shareholders of the Company	-	99	-	3	102
Net income/(loss) attributable to the shareholders
of the Company	-	-	-	766	766
Post-employment benefits	-	-	-	66	66
Tax effect – Post-employment benefits	-	-	-	(22)	(22)
Equity instruments at fair value through OCI –
changes in fair value	-	-	23	-	23
Tax effect – equity instruments at fair value through OCI	-	-	(7)	-	(7)
Other	-	-	(3)	3	-
Other comprehensive income/(loss) that will not be reclassified to the income statement	-	-	13	47	60
Cash flow hedges – changes in fair value	-	-	(11)	-	(11)
Currency translation differences	(485)	-	-	-	(485)
Other	(1)	-	7	-	6
Other comprehensive income/(loss) that may be reclassified
to the income statement	(486)	-	(4)	-	(490)
Total comprehensive income/(loss)	(486)	-	9	813	336
At December 31, 2020 – carried forward to next page	(1,265)	-	114	10,681	9,530

	Translation	Treasury	Other	Retained
(in € millions)	reserve	shares	reserves	earnings	Total
At December 31, 2020 – brought forward from previous page	(1,265)	-	114	10,681	9,530
Dividends and other appropriations	-	-	-	(414)	(414)
Share buybacks	-	(1)	-	-	(1)
Sale/cancellation of shares	-	1	-	-	1
Other	-	-	-	10	10
Transactions with the shareholders of the Company	-	-	-	(404)	(404)
Net income/(loss) attributable to the shareholders
of the Company	-	-	-	1,030	1,030
Post-employment benefits	-	-	-	254	254
Tax effect – Post-employment benefits	-	-	-	(67)	(67)
Equity instruments at fair value through OCI –
changes in fair value	-	-	4	-	4
Tax effect – equity instruments at fair value through OCI	-	-	-	-	-
Other	-	-	(1)	1	-
Other comprehensive income/(loss) that will not be reclassified
to the income statement	-	-	3	188	191
Cash flow hedges – changes in fair value	-	-	(5)	-	(5)
Currency translation differences	337	-	-	-	337
Other	(2)	-	4	1	3
Other comprehensive income/(loss) that may be reclassified
to the income statement	335	-	(1)	1	335
Total comprehensive income/(loss)	335	-	2	1,219	1,556
AT JUNE 30, 2021	(930)	-	116	11,496	10,682

During first-half 2021, the Group bought back 8,032 shares for €1 million and then sold them immediately.

In January 2020, an agreement was signed with an investment services provider under which the Company undertook to buy back up to €100 million worth of Michelin shares before November 19, 2020.

A total of 1,097,540 shares were finally bought back under the program at an average price per share of €89.83, representing a total investment of €99 million. All of the shares bought back under the agreement were canceled before the end of 2020.

NOTE 15 EMPLOYEE BENEFIT OBLIGATIONS

Movements in net defined benefit obligations recognized in the consolidated statement of financial position are shown below:

(in € millions)	Pension plans	Other plans	2021	2020
At January 1	1,626	1,863	3,489	3,828
Contributions paid to the funds	(10)	-	(10)	(84)
Benefits paid directly to the beneficiaries	(29)	(42)	(71)	(70)
Other movements	-	(4)	(4)	-
Items recognized in operating income
Current service cost	22	34	56	55
Actuarial (gains) or losses recognized on other long-term benefit plans	-	-	-	-
Past service cost resulting from the introduction of new plans or plan amendments	-	-	-	-
Past service cost resulting from plan curtailments	-	-	-	-
(Gains) or losses on plan settlements	-	-	-	-
Effect of plan curtailments recognized within reorganizations and adaptation of activities	(33)	(54)	(87)	-
Other items	5	-	5	3
Items recognized outside operating income
Net interest on employee benefit obligations	6	13	19	28
Items recognized in other comprehensive income
Translation adjustments	(5)	28	23	(17)
Actuarial (gains) or losses	(213)	(81)	(294)	(112)
Unrecognized assets due to the effect of the asset ceiling	40	-	40	33
AT JUNE 30	1,408	1,758	3,166	3,664
Recognized in the consolidated statement of financial position as follows:
Non-current financial assets and other non-current assets			242	194
Employee benefit obligations			3,408	3,858

In France, the voluntary early retirement and voluntary outplacement measures provided for in the 2021 Collective Settlement Agreement (note 4) had the effect of reducing the Group's pension obligations by €33 million and its other postemployment benefit obligations by €54 million. A provision for reorganizations and adaptation of activities was recorded at June 30, 2021 (note 16).

Actuarial gains and losses recorded in equity are primarily explained by changes in discount rates and by the experience adjustments to plan assets located in the following countries:

		United	United
(in € millions)	Eurozone	Kingdom	States	Canada	Total
Discount rate at June 30, 2021	0.93%	1.90%	2.79%	3.10%	n/a
Discount rate at December 31, 2020	0.54%	1.45%	2.49%	2.42%	n/a
Inflation rate at June 30, 2021	1.72%	3.20%	2.00%	2.00%	n/a
Inflation rate at December 31, 2020	1.68%	2.90%	2.00%	2.00%	n/a
Actuarial (gains)/losses arising from changes in assumptions	(110)	(120)	(115)	(115)	(460)
Experience (gains)/losses on plan assets	-	104	5	57	166
ACTUARIAL (GAINS) OR LOSSES	(110)	(16)	(110)	(58)	(294)

Rates and amounts shown in the above table relate to benefit plans for which an actuarial valuation has been carried out for the interim period (note 2.2).

NOTE 16 PROVISIONS AND OTHER NON-CURRENT LIABILITIES

Provisions and other non-current liabilities amount to €768 million (2020: €775 million) and include provisions for reorganizations and adaptation of activities, provisions for claims and litigation, warranties and other contingencies, and contract liabilities as described in note 3.8 to the consolidated financial statements at December 31, 2020 on "Revenue recognition".

16.1 Changes in provisions (current and non-current)

Changes in provisions during the period are presented below:

	Reorganizations and adaptation of	Litigation, warranties and
(in € millions)	activities	other provisions	Total
At January 1, 2021	258	345	603
Additional provisions	113	66	179
Provisions utilized during the period	(105)	(33)	(138)
Unused provisions reversed during the year	(2)	(1)	(3)
Translation adjustments	2	6	8
Other effects	-	(5)	(5)
AT JUNE 30, 2021	266	378	644
Of which short-term portion	178	72	250

Additional provisions for reorganizations and adaptation of activities include the provision set up for the costs associated with the simplification and competitiveness plan in France for an amount of €99 million (notes 4 and 15).

16.2 Provisions for claims and litigation, warranties and other provisions

Provisions at June 30 concern the following risks:

(in € millions)		June 30, 2021 December 31, 2020
Provisions for claims and litigation	102	90
Provisions for product warranties	69	62
Provisions for product liability claims	51	40
Other provisions for contingencies	156	153
TOTAL	378	345

NOTE 17 NOTES TO THE STATEMENT OF CASH FLOWS

Cash flows are presented in detail in the table below:

(in € millions)	First-half 2021	First-half 2020
Investment grants recognized in profit or loss	(5)	(5)
Change in employee benefit obligations	(30)	(105)
Change in litigation and other provisions	30	13
Restructuring costs	(108)	(110)
Other	12	8
Other operating income and expenses (cash) and change in provisions	(101)	(199)
Interest and other financial expenses paid	(68)	(155)
Interest and other financial income received	3	11
Dividends received	4	7
Interest and other financial income and expenses received and paid, net	(61)	(137)
Change in inventories	(629)	304
Change in trade receivables and advances	(412)	262
Change in trade payables and advances	113	(665)
Change in trade payables under reverse factoring agreements	73	(175)
Change in other receivables and payables	22	37
Change in working capital, net of impairment	(833)	(237)
Purchases of intangible assets	(95)	(77)
Purchases of PP&E	(448)	(413)
Government grants received	6	4
Change in capital expenditure payables	(117)	(283)
Purchases of intangible assets and PP&E	(654)	(769)
Increase in other non-current financial assets	(35)	(51)
Decrease in other non-current financial assets	39	6
Net cash flows from cash management financial assets	-	-
Net cash flows from borrowing collaterals	2	9
Net cash flows from other current financial assets	(9)	(10)
Cash flows relating to other financial assets	(3)	(46)
Increase in non-current financial liabilities	4	505
Decrease in non-current financial liabilities	(821)	(145)
Repayment of lease liabilities	(124)	(114)
Net cash flows from current financial liabilities	63	1,537
Derivatives	(13)	(56)
Cash flows relating to financial liabilities	(891)	1,727
Details of non-cash transactions:
▶ New leases	85	95
▶ New emission rights	1	11

NOTE 18 LITIGATION AND CONTINGENT LIABILITIES

The Group is involved in litigation arising in the normal course of business. Taken as a whole, the resulting liabilities are not expected to be material in relation to the Group's business or consolidated financial position.

During first-half 2021, one of the Group's Brazilian subsidiaries received a notice of reassessment from the tax authorities relating to the 2017 financial year.

The reassessment concerns the deductibility of goodwill amortization recorded during the year.

The company is strongly contesting the reassessment under a standard procedure brought before the administrative court on April 27, 2021. It considers that amortizing the goodwill was justified, in terms of both its form and substance, and believes that the court is likely to find in its favor. Consequently, no provision has been recorded for this matter.

NOTE 19 EVENTS AFTER THE REPORTING DATE

No material events occurred between the reporting date and the date when the condensed interim consolidated financial statements were authorized for issue by the Managing Chairman.

STATUTORY AUDITORS' REVIEW REPORT ON THE INTERIM FINANCIAL INFORMATION 136

STATUTORY AUDITORS' REVIEW REPORT ON THE INTERIM FINANCIAL INFORMATION

(Half-year ended June 30, 2021)

To the Shareholders,

This is a free translation into English of the Statutory auditors' review report issued in French and is provided solely for the convenience of English-speaking readers. This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.

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

• ► the review of the accompanying condensed interim consolidated financial statements of Compagnie Générale des Établissements Michelin, for the six-month period ended June 30, 2021;
• ► the verification of the information contained in the interim management report.

The global crisis linked to the Covid-19 pandemic creates special conditions for the preparation and limited review of the condensed interim consolidated financial statements. Indeed, this crisis and the exceptional measures taken in the context of the state of health emergency induce multiple consequences for companies, particularly on their activity and their financing, as well as increased uncertainties on their future prospects. Some of these measures, such as travel restrictions and remote working, have also had an impact on the internal organization of companies and on the way in which our work is carried out.

These condensed interim consolidated financial statements have been drawn up under the responsibility of the Managing Chairman. Our role is to express our conclusion on these financial statements based on our limited review.

I. CONCLUSION ON THE FINANCIAL STATEMENTS

We conducted our review in accordance with professional standards applicable in France.

A limited review primarily consists of inquiries with members of the management responsible for accounting and financial aspects and implementing analytical procedures. A review is substantially less in scope than an audit carried out in accordance with professional standards applicable in France. Consequently, the assurance that the financial statements, taken as a whole, do not contain any significant anomalies, obtained within the framework of a limited review is a moderate assurance, lower than that obtained within the framework of an audit.

Based on our limited review, we did not identify any significant anomalies likely to call into question the compliance of the condensed half-year consolidated financial statements with IAS 34, the IFRS standard as adopted in the European Union. relating to interim financial information.

II. SPECIFIC VERIFICATION

We have also verified the information given in the half-year activity report commenting on the condensed interim consolidated financial statements on which our limited review was based.

We have no observations to make as to their fairness and their consistency with the condensed interim consolidated financial statements.

Neuilly-sur-Seine and Paris La Défense, July 26, 2021

The Statutory Auditors

PricewaterhouseCoopers Audit Deloitte et Associés

Jean-Christophe Georghiou Frédéric Gourd

06 Statement by the person responsible

STATEMENT BY THE PERSON RESPONSIBLE FOR THE FIRST-HALF 2021 FINANCIAL REPORT 138

STATEMENT BY THE PERSON RESPONSIBLE FOR THE FIRST-HALF 2021 FINANCIAL REPORT

I hereby declare that, to the best of my knowledge, (i) the condensed financial statements for the past six-month period have been prepared in accordance with generally accepted accounting principles and give a true and fair view of the assets, liabilities, financial position and results of the Company and the undertakings included in the consolidation, and (ii) the first-half business review on pages 76 to 106 presents a fair review of the material events that occurred in the first six months of the financial year, of their impact on the interim accounts, and of the main related-party transactions, and also describes the principal risks and uncertainties for the remaining six months of the year.

Florent Menegaux

Design and production: Tel.: + 33 (0) 1 55 32 29 74

Photos credit: Michelin/Getty Images

COMPAGNIE GÉNÉRALE

DES ÉTABLISSEMENTS MICHELIN + 33 (0) 4 73 32 20 00 23, Place des Carmes-Déchaux – 63000 Clermont-Ferrand – France www.michelin.com

INVESTor relations

ÉDOUARD DE PEUFEILHOUX, PIERRE HASSAIRI, FLAVIEN HUET + 33 (0) 4 63 21 56 90 27, cours de l'Île Seguin – 92100 Boulogne-Billancourt – France 23, Place des Carmes-Déchaux – 63000 Clermont-Ferrand – France investor-relations@michelin.com

INDIVIDUaL shareholder relations

ÉDOUARD DE PEUFEILHOUX, CLÉMENCE RODRIGUEZ, ISABELLE MAIZAUD-AUCOUTURIER + 33 (0) 4 73 32 23 05 23, Place des Carmes-Déchaux – 63000 Clermont-Ferrand – France Toll-free calls in France: 0 800 716 161 actionnaires-individuels@michelin.com

Sustainable development and mobility

NICOLAS BEAUMONT + 33 (0) 4 73 32 20 00 23, Place des Carmes-Déchaux – 63 000 Clermont-Ferrand – France

Communication

and brands department MEDIA RELATIONS: PAUL-ALEXIS BOUQUET + 33 (0) 1 45 66 22 22 27, cours de l'Île Seguin – 92100 Boulogne-Billancourt – France