Robertet — Interim / Quarterly Report 2020

Oct 28, 2020

CONDENSED CONSOLIDATED INTERIM STATEMENTS

AS OF JUNE 2020

SUMMARY

STATEMENT OF INCOME FOR THE PERIOD	4
STATEMENT OF COMPREHENSIVE INCOME	5
BALANCE SHEET	6
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY	7
STATEMENT OF CASH FLOW	8
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	9
BUSINESS REPORT FOR THE 1ST HALF OF 2020	28
CERTIFICATION OF THE HALF-YEARLY FINANCIAL REPORT	31
STATUTORY AUDITORS' REPORT	33
THE ROBERTET GROUP	35

• STATEMENT OF INCOME FOR THE PERIOD •
• STATEMENT OF COMPREHENSIVE INCOME
• BALANCE SHEET •

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY •

STATEMENT OF CASH FLOW •

PERIOD ENDING 30 JUNE 2020

STATEMENT OF INCOME FOR THE PERIOD in thousands of euros

	NOTE	30-June-20	30-June-19	31-Dec-19
SALE OF PRODUCTS	12	280 208	287 710	554 273
REVENUE FROM ORDINARY ACTIVITIES		280 208	287 710	554 273
Other operating income		1 475	872	5 395
Purchases consumed		-125 000	-133 158	-257 748
External expenses		-34 119	-39 277	-78 535
Personel cost		-59 901	-58 601	-118 214
Taxes and duties		-6 497	- 5 367	-10 848
Depreciation, amortization, provisions and reversals	13	-14 741	-11 364	-21 234
Other operating expenses		-4	-36	-47
CURRENT OPERATING INCOME	12	41 420	40 778	73 044
Asset disposals		22	98	81
OPERATING INCOME		41 442	40 876	73 125
Income from cash and cash equivalents		18	132	329
Gross cost of financial debt		-588	-830	-1 500
Net financial cost	14	-570	-698	-1 171
Other financial income and expenses	14	-355	794	1 146
INCOME BEFORE TAXES		40 517	40 972	73 099
Current and deferred taxes	15	-11 008	-11 716	-21 245
Share in the net income of equity affiliates		601	245	1 191
NET INCOME OF CONSOLIDATED COMPANIES		29 509	29 256	51 854
NET INCOME OF THE CONSOLIDATED GROUP		30 111	29 501	53 045
Net income attributable to minority interest		16	80
NET INCOME (Group share)	12	30 095	29 422	53 045
NET INCOME PER EXISTING SHARE (in euros)		13,03	12,75	22,98
BASIC NET INCOME PER SHARE (in euros)	17	13,04	12,76	22,96
DILUTED NET INCOME (in euros)	17	13,04	12,76	22,96

STATEMENT OF COMPREHENSIVE INCOME in thousands of euros

	NOTE	30-June-20	30-June-19	31-Dec-19
Net income		30 111	29 501	53 045
Recyclable components		-7 195	1 084	2 128
Currency translation differential	SCSE(1)	-7 195	1 084	2 128
Non-recyclable components		-29	-688	-711
Actuarial gains and losses on pension benefits	9	-43	-1 012	-1 046
Tax impact on actuarial gains and losses		14	324	335
Global Income	SCSE(1)	22 886	29 897	54 462
Income attributable to shareholders of Robertet SA	SCSE(1)	22 871	29 817	54 462
Income attributable to minority interests	SCSE(1)	16	80

(1) SCSE : Statement of changes in shareholders' equity

BALANCE SHEET in thousands of euros

	NOTE	30-June-20	31-Dec-19
NON-CURRENT ASSETS		226 423	224 153
GOODWILL	3	32 428	27 621
INTANGIBLE ASSETS		1 664	1 641
TANGIBLE ASSETS	4	153 586	159 257
RIGHTS OF USE	4	12 573	12 103
FINANCIAL ASSETS	5	21 541	19 223
SHARE IN COMPANIES ACCOUNTED FOR BY EQUITY		3 336	2 885
DEFERRED TAXES	15	1 296	1 423
CURRENT ASSETS		463 279	432 689
INVENTORIES AND WORK IN PROGRESS	6	178 686	187 550
ACCOUNTS RECEIVABLE AND RELATED ACCOUNTS	7	126 478	113 609
OTHER RECEIVABLES AND PREPAID EXPENSES	8	18 553	19 436
CURRENT TAX ASSETS	8	523	564
OTHER CURRENT FINANCIAL ASSETS		212	95
CASH AND CASH EQUIVALENTS		138 828	111 436
TOTAL ASSETS		689 703	656 842
SHAREHOLDERS' EQUITY		469 189	456 108
CAPITAL		5 776	5 770
SHARE PREMIUMS		61 945	12 432
CONSOLIDATED RESERVES		401 442	437 906
SHAREHOLDERS' EQUITY (GROUP SHARE)		469 163	456 108
MINORITY INTERESTS		26
NON-CURRENT LIABILITIES		83 316	84 680
PROVISIONS - LONG-TERM PORTION	9	13 282	13 157
LIABILITIES - LONG-TERM PORTION	10	50 383	52 220
RENTAL DEBTS - LONG-TERM PORTION	10	11 237	11 127
DEFERRED TAXES	15	8 413	8 177
CURRENT LIABILITIES		137 197	116 054
PROVISIONS - SHORT-TERM PORTION	9	1 336	1 261
LIABILITIES - SHORT-TERM PORTION	10	48 570	34 974
RENTAL DEBTS - SHORT-TERM PORTION	10	2 514	2 357
CURRENT TAX LIABILITIES		7 394	3 677
SUPPLIERS		37 026	39 590
OTHER CURRENT LIABILITIES	11	40 357	34 194
TOTAL LIABILITIES		689 703	656 842

STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY in thousands of euros

	Capital	Premiums	Consolidated reserve	Conversion	(Group share) Equity	interests Minority	Total shareholders equity
Total shareholders' equity as of Dec 31, 2018	5 763	12 432	388 556	3 019	409 770	1 189	410 960
Comprehensive income			28 734	1 084	29 818	80	29 897
Dividends paid			-12 922		-12 922		-12 922
Consolidation scope changes
Allocation of free shares			808		808		808
Impact IFRS16			-1 047		-1 047		-1 047
Other variations			251		251		251
Capital increase	6		-6
Total other changes in shareholders' equity	6		-12 917		-12 910		-12 910
Total shareholders' equity as of 30 June 2019	5 769	12 432	404 374	4 103	426 678	1 269	427 947
Total shareholders' equity as of 31 Dec 2019	5 770	12 432	432 758	5 147	456 107		456 107
Comprehensive income			30 066	-7 195	22 871	16	22 886
Dividends paid			-11 552		-11 552		-11 552
Consolidation scope change			863		863	11	874
Allocation of free shares			620		620		620
Capital increase	6		-6
Merging Robertet/Charabot		49 513	-49 513
Other variations			253		253		253
Total other changes in shareholders' equity	6	49 513	-59 334		-9 816	11	-9 805
Total shareholders' equity as of 30 June 2020	5 776	61 945	403 490	-2 048	469 163	26	469 189

STATEMENT OF CASH FLOW in thousands of euros

	NOTE	30-June-20	30-June-19	31-Dec-19
Consolidated net income	12	30 095	29 422	53 045
Minority interests		16	80
Elimination of net income from EAE		-451	-95	-1 041
Amortization of fixed tangible and intangible assets	13	10 387	10 010	20 072
Net allocations to provisions		444	241	445
(Gains) / losses on disposals of assets		-22	-98	-81
Charges and expenses without impact on cash flow		983	786	1 558
Current and deferred taxes	15	11 008	11 716	21 245
Cost of net financial debt		342	412	621
Impact of local re-evaluation		209	157	510
Operating cash flow before cost of net financial debt and tax		53 009	52 628	96 374
Stock variations	6	8 904	-3 371	1 314
Change in trade and other receivables	7	-2 390	-25 560	-9 407
Change in trade payables and other accounts payables		-6 525	6 709	3 265
Impact of changes in working capital requirements		-12	-22 583	-4 828
Interest paid and received		-301	-440	-699
Taxes paid		-7 084	-7 613	-18 659
Net cash flow from operating activities		45 613	21 992	72 188
Industrial investments and finance leases	4	-7 632	-11 235	-25 036
Financial investments net of divestments		-4 116	-110	-4 553
Disposal of assets		36	161	310
Dividends received			24	70
Impact of changes in the scope of consolidation		-231		718
Cash flow used in investing activities		-11 943	-11 160	-28 490
Dividends paid out by the parent company	SCSE(1)	-11 552	-12 922	-12 922
Loans taken out		5 000	300	300
Loans reimbursed		-8 003	-11 989	-23 063
Net change in other financial debts		12 290	637	-866
Cash flow from financing activities		-2 265	-23 975	-36 551
Effect of exchange rate changes on cash and cash equivalents		-2 005	53	1
Overall changes in cash and cash equivalents		29 400	-13 090	7 148
Net cash and cash equivalents at opening		97 275	90 126	90 126
Net cash and cash equivalents and closing		126 674	77 036	97 275

(1) SCSE : Statement of Changes in Shareholders' Equity

NOTE TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

PERIOD ENDING 30 JUNE 2020

NOTE 1 - SIGNIFICANT EVENTS AND GENERAL INFORMATION DURING THE PERIOD

The condensed consolidated financial statements of the Robertet Group for the first half of 2020 include Robertet and its subsidiaries. Robertet is a Group entirely focused on the design, manufacture and marketing of aromatic products. Robertet is a company incorporated under French law and listed on the Paris Stock Exchange (Euronext compartment B), whose registered office is located at 37, avenue Sidi-Brahim, 06130 Grasse.

Robertet's condensed consolidated interim financial statements were approved by the Board of Directors on September 22, 2020.

As already described in the financial statements as at December 31, 2018 and 2019, the simplified merger of Charabot SA in Robertet SA was realized on July 31, 2020, with retroactive effect to January 1, 2020.

SIRIUS was fully consolidated for the first time following the acquisition of a 60.14% interest (capital and voting rights) in this entity for a purchase price of 1 500K€. Commitments for mutual sales and acquisitions between now and 2022/2023 are estimated at 4 million Euros, based on a projection of Gross Operating Income, which is the variable used to calculate this price complement.

This acquisition strengthens the Group's leadership position in Organic Essential Oils and floral waters, and reaffirms the Group's desire to remain the independent and key player in Natural Aromatic Products. This operation also consolidates the Group's sourcing through new integrated channels and is in line with the integration of SAPAD. This acquisition is also an opportunity to offer a turnkey product service for well-being.

Revenue and profits since the date of acquisition amount to 5,130 K€ and 277 K€ respectively.

This consolidation resulted in the recognition of a provisional goodwill of EUR 4.8 million.

Group's scope of consolidation, Robertet Africa (78%-owned) and Robertet Indonesia (creation). These two entities, also fully consolidated, did not generate any goodwill in the interim financial statements.

NOTE 2 - SUMMARY OF MAIN ACCOUNTING RULES AND METHODS

Basis for the preparation of the financial statements

The consolidated financial statements of the Robertet Group have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted in the European Union.

The condensed consolidated financial statements for the six months ended June 30, 2020 have been prepared in accordance with the provisions of IAS 34 on interim financial reporting. In accordance with this standard, only a selection of explanatory notes is included in these condensed financial statements. These notes may be completed by reading the consolidated financial statements for the year ended December 31, 2019. The accounting policies are identical to those applied for the consolidated financial statements for the year ended December 31, 2019.

The Group has not anticipated any standards and interpretations whose application is not mandatory in 2020.

For the presentation of the condensed interim consolidated financial statements for the six months ended June 30, 2020, the Group has applied all standards and interpretations that have entered into force at European level and are applicable to fiscal years beginning on or after January 1, 2020.

These new standards and interpretations are as follows :

Standards and interpretations mandatorily applicable as of January 1, 2020

• Amendment to IAS 1 and IAS 8. Definition of the term "significant"

This amendment specifies that information is significant if its omission, misstatement or obscuration can reasonably be expected to influence the decisions of the principal users of the financial statements.

• IFRS 3 amendment. Definition of an activity

This amendment clarifies the definition of an activity by proposing an analysis in two stages, and by aiming to limit the diversity of practices relating to the notion of activity.

• Amendment of IFRS standards to update references to the conceptual framework

This alignment with the new conceptual framework published in 2018 concerns the following standards and interpretations: IFRS 2, IFRS 3, IFRS 6, IFRS 14, IAS 1, IAS 8, IAS 34, IAS 37, IAS 38, IFRIC 12, IFRIC 19, IFRIC 20, IFRIC 22 and SIC 32.

➣ These new texts had no impact on the Group's financial statements.

Standards and interpretations applicable in advance as of January 1, 2020

At the closing date of these consolidated financial statements, the standards and interpretations listed below were issued respectively by the IASB and IFRS IC but not yet adopted by the European Union.

• Amendment to IAS 1. Classification of liabilities as current and non-current liabilities
• Amendment to IFRS 16. Rental concessions related to Covid-19
• Amendments to the norms IFRS 3, IAS 16 and IAS 37. Update of references to the conceptual framework

The Group has chosen not to apply these standards and interpretations early but has begun to analyze the consequences of their application. The Group will apply these standards in its financial statements as soon as they are adopted by the European Union.

Use of estimates

The preparation of the financial statements requires Robertet to make estimates and assumptions that may have an impact on the amounts of assets and liabilities, as well as income and expenses. The estimates and underlying assumptions are based on past experience and other factors considered reasonable under the circumstances.

They thus serve as a basis to exercise judgment in determining the carrying amounts of assets and liabilities, which cannot be obtained directly from other sources. The amounts appearing in Robertet's future financial statements may differ from the currently estimated values. These estimates and assumptions are reviewed on an ongoing basis.

The Group's income tax expense has been calculated on the basis of the estimated effective tax rate for the period. This rate, determined using the tax rates applicable in the Group's tax entities, is applied to pre-tax income.

Consolidation rules

Significant subsidiaries that are exclusively controlled, directly or indirectly, are fully consolidated. Companies over which Robertet exercises joint control or significant influence are consolidated using the equity method. All these companies have been consolidated on the basis of financial statements for the period ended June 30, 2020.

All intra-group balances and transactions are eliminated on consolidation.

The financial statements of foreign companies whose functional currency is not the euro are translated using the following principles :

• balance sheet items are translated at the rates prevailing at the end of the period. The exchange differential resulting from the application of a different exchange rate to opening shareholders' equity is recorded in shareholders' equity in the consolidated balance sheet ;
• income statements are translated at the average rate for the period. The exchange differential resulting from the application of an exchange rate different from the balance sheet rate is recorded under shareholders' equity in the consolidated balance sheet.

The risks identified within the Robertet Group are identical to those described in the consolidated financial statements for the year ended December 31, 2019.

Scope

The condensed interim financial statements for the six months ended June 30, 2020 include the financial statements of companies over which the Robertet Group has direct or indirect de jure or de facto control.

Description of the main risks and uncertainties for the remaining six months

The risk factors are of the same nature as those described in the 2019 Annual Report and do not present any significant changes during the first half of 2020.

Main transactions with related parties

Information on related parties is detailed in note 18, which presents the main changes in the Group's financial position semester.

Impact of the health crisis on the financial statements

On January 30, 2020, the World Health Organization declared a state of public health emergency of international concern following the spread of the Covid-19 virus and designated it a pandemic on March 11, 2020.

In response to this health crisis, governments around the world have been forced to adopt restrictive social and economic measures to limit the spread of the virus.

These measures taken by all countries have had a significant impact on the global economy. In this context, the Robertet Group has assessed the impact of the uncertainties created by the pandemic.

As of June 30, 2020, these uncertainties have not led to a significant change in the estimates and assumptions used by the Group. Furthermore, the Robertet Group will continue to update these estimates and assumptions as the situation evolves.

Effect of the pandemic on the valuation of goodwill and intangible assets

In accordance with IAS 36, the Group performs impairment tests on the assets attached to each of its CGUs once a year, regardless of the existence of any indication of impairment. The most recent impairment tests were performed as of December 31, 2019 (see note 2 to the consolidated financial statements for the year ended December 31, 2019).

As part of the preparation of its consolidated financial statements at June 30, 2020, the Robertet Group reviewed quantitative and qualitative indicators and identified indications of impairment of certain assets directly or indirectly related to the Covid-19 pandemic.

Although the impairment tests performed in 2019 on the CGUs concerned by these indications of impairment had recoverable amounts significantly higher than their carrying amounts, the Group has nevertheless updated these tests by revising the business plans of each of the CGUs.

These tests did not lead the Group to recognize any impairment in the consolidated financial statements as of June 30, 2020. The results of the tests of the main CGUs concerned are presented in note 3.

Impact of the pandemic on income

For the Group as a whole, the Covid-19 pandemic did not result in the termination or substantial modification of distribution contracts.

Effect of the pandemic on inventories

To cope with the supply risks related to the Covid-19 pandemic crisis, the Group's production sites were able to maintain their level of activity thanks to the implementation of specific sanitary measures. In the event of a drop in production levels, the Group does not take into account the effects of under-absorption in the evaluation of the production cost of inventories, in accordance with IAS 2.

Effect of the pandemic on trade receivable

At June 30, 2020, the Robertet Group analyzed indicators of impairment of trade receivables, such as the breakdown of gross receivables according to their age and the amount of doubtful receivables. The Group has identified elements that may justify a significant increase in credit risk (see note 7)

Impact of the pandemic on cash flow

The Covid-19 pandemic did not have a negative impact on the liquidity of the Robertet Group.

Effect of the pandemic on the presentation of the income statement

The effects of the Covid-19 pandemic are presented in the notes to the income statement in accordance with the nature of the corresponding income and expenses. No item related to the health crisis has been classified in other non-current income and expenses.

NOTE 3 - GOODWILL in thousands of euros

Goodwill on the assets breaks down as follows

	30-June-20	31-Dec-19
Flavor Division :
Gross Value	7 879	7 879
Impairment
Net Value	7 879	7 879
Fragrance Division
Gross Value	17 808	17 808
Impairment
Net Value	17 808	17 808
Raw Materials Division :
Gross Value	6 741	1 934
Impairment
Net Value	6 741	1 934

The change in net values can be analyzed as follows :

	30-June-20	31-Dec-19
Net carrying amount at opening	27 621	27 621
Acquisitions (1)	4 807
Total	32 428	27 621

Total Net Value 32 428 27 621

(1) Goodwill relating to the acquisition of SIRIUS, which was fully consolidated in the first half of the year 2020. This goodwill is allocated to the raw materials CGU related to the company's business. No goodwill has been identified to date.

Goodwill has been calculated as follows (in thousands of euros) :

Overall estimate of the purchase price	5 509
Shareholders' equity at the date at the date of acquisition	702
Goodvill	4 807

Goodwill is allocated to Cash Generating Units (CGUs) based on the activity to which it relates. The CGUs defined correspond to the Flavor, Fragrance and Raw Materials divisions.

There are no indications of impairment for certain significant assets.

The COVID-19 pandemic had a relatively negative impact on revenue growth in the first half of the year, considered by Group Management as an indication of impairment in the Raw Materials and Perfumes divisions.

The value of these two CGUs was therefore tested at June 30, 2020.

This test was determined using 5-year projections of cash flows generated by the sales of each division. Beyond these 5 years, a terminal value has been determined based on a growth rate of 2.5% for the Raw Materials Division and 1.5% for the Perfumes Division. These cash flows are discounted net of tax at a rate of 8.0%. This rate is after tax.

The Group is currently working on calculating different discount rates for each CGU, with the objective of implementing them as part of the impairment tests as of December 31, 2020. The results of the tests confirm that there is no impairment of the assets allocated to these CGUs.

Sensitivity test

The Group performs sensitivity tests on the main assumptions. The main results of these tests are

presented below:

A perpetual growth rate of zero would not result in any depreciation.

The level of the discount rate (key assumption) for which the recoverable amount is equal to the carrying amount (after taking into account all the effects of this change on the other variables used) is:

• Fragrance Division: 10.85%
---------------------------------

• Raw Materials Division: 13.70%

The change in the "EBITDA/Sales" ratio for which the recoverable amount is equal to the carrying amount (after taking into account all the effects resulting from this change on the other variables used) is:

• Fragrance Division:	2,7 points,
• Raw Materials Division:	6,4 points.

FIXED ASSETS	Value as of 31-Dec-19	Exchange differential	Acquisitions	Divestments	Other movements	Changes in scope of consolidation	Value as of 30-June-20
Land	28 600	-847	76		25		27 854
Buildings	157 245	-2 336	914		7 411	719	163 953
Technical facilities	164 937	-1 113	1 877	5	249	316	166 261
Other fixed assets	20 948	-761	142	118	1 025	378	21 614
Assets in progress	10 404	344	2 746		-8 634	109	4 969
TOTAL	382 135	-4 713	5 755	123	76	1 522	384 652

•1 Tangible fixed assets

DEPRECIATION	Value as of 31-Dec-19	Exchange differential	Allocations	Reversals	Other movements	Changes in scope of consolidation	Value as of 30-June-20
Land	3 231		3				3 234
Buildings	72 383	-269	3 105		23	434	75 676
Technical facilities	129 947	-727	4 746	53	12	243	134 168
Other fixed assets	17 315	-333	929	114	7	182	17 986
TOTAL	222 876	-1 329	8 783	167	42	859	231 064

NET VALUE	159 257					153 586
-----------	---------	--	--	--	--	---------

The industrial project underway at the Brazilian entity was commissioned in the first half of 2020.

•2 Rights of use

Changes in user fees during the first half of 2020 can be analyzed as follows :

RIGHTS OF USE	Value as of 31-Dec-19	Exchange differential	Acquisitions	Divestments	Other movements	Changes in scope of consolidation	Value as of 30-June-20
Buildings	8 431	-32	1 265		693	-50	10 307
Technical facilities	14 492	-773	161		-514	-459	12 907
Other fixed assets	1 842	-21	393		387	-22	2 579
TOTAL	24 765	-826	1 819		566	-531	25 793

Value as of 31-déc-19	Exchange differential	Allocations	Reversals	Other movements	Change in scope	Value as of 30-June-20
3 774	3	623		450	-50	4 800
8 378	-599	623		-514	-457	7 431
511	-1	321		167	-8	990
12 663	-597	1 567		103	-515	13 221

NET VALUE 12 103 12 573
-------------------------------

The sum of 0.5 million as of June 30, 2020 represents residual rent from non-capitalized leases under the exceptions provided for in the standard.

NOTE 5 - FINANCIAL ASSETS in thousands of euros

NON-CURRENT FINANCIAL ASSETS	30-June-20	31-Dec-19
Equity investments carried at cost	1 922	3 585
Deposits and guarantees	2 679	2 433
Receivables from equity interests	8 585	8 597
Other immobilized securities (1)	8 195	4 440
Loans	160	168
TOTAL	21 541	19 223

(1) These are long-term investments of the American subsidiary Robertet USA

NOTE 6 - STOCKS in thousands of euros

	30-June-20	31-Dec-19
Raw materials	112 250	124 227
Work in progress and finished goods	75 007	69 698
Gross value	187 257	193 925
Provisions	-8 572	-6 375
NET VALUE	178 686	187 550

Provisions for depreciation break down as follows:

	30-June-20	31-Dec-19
Balance at opening of the period	6 375	7 575
Change in scope of consolidation	365
Increases	2 033	6 246
Reversals and uses	-21	-7 400
Conversion differential	-180	-46
Balance at closing of the period	8 572	6 375

NOTE 7 – TRADE RECEIVABLES in thousands of euros

Breakdown of trade receivables	30-June-20	31-Dec-19
Europe	41 616	38 731
North America	35 050	30 298
South America	14 673	13 477
Asia	33 502	28 504
Other countries	8 807	7 948
TOTAL GROSS RECEIVABLES	133 649	118 958
Provisions for depreciation	7 171	5 349
TOTAL NET RECEIVABLES	126 478	113 609

Provisions for impairment are as follows:

	30-June-20	31-Dec-19
Balance at opening of the period	5 349	3 525
Increases	1 987	2 643
Changes in scope of consolidation	39
Reversals and uses	-92	-907
Conversion differential	-117	23
Other movements	5	66
Balance at closing of the period	7 171	5 349

The increase in provisions for impairment is due to the increase in country risk on certain Group receivables.

NOTE 8 – OTHER ASSETS in thousands of euros

	30-June-20	31-Dec-19
Prepaid expenses	5 087	5 351
Other receivables	13 466	14 085
TOTAL RECEIVABLES AND ACCRUALS	18 553	19 436
Current tax assets	523	564
Deferred tax assets	1 296	1 423
TOTAL	20 372	21 423

NOTE 9 – PROVISIONS in thousands of euros

	Opening	Allocations	Uses	Exchange rate variation	Closing
RETIREMENT BENEFITS (2)	11 600	481		-10	12 071
Other employee benefits (2)	1 889	99	-58	-213	1 717
Other risks (1)	929		-34	-64	831
RISKS AND EXPENSES	2 818	99	-92	-277	2 548
TOTAL PROVISIONS	14 418	580	-92	-287	14 619
of which current liabilities	1 261				1 336
of which non-current liabilities	13 157				13 282

(1) Other risks correspond mainly to social, tax and commercial risks.

Each of the known disputes in which Robertet or Group companies are involved was reviewed at the balance sheet date, and after obtaining the opinion of legal counsel, the provisions deemed necessary were, where appropriate, set aside to cover the estimated risks.

(2) The actuarial assumptions have not changed compared to December 31, 2019 for the calculation of retirement benefits and other employee commitments for the Group's French entities (the commitments in France representing 98.4% of the Group's pension provisions, which is why only the assumptions concerning France are detailed), excluding the discount rate:

	30-June-20	30-June-19	31-Dec-19
Discount rate (1)	0,74%	0,77%	0,77%

(1) This corresponds to the Iboxx AA10+ rate.

NOTE 10 - FINANCIAL & LEASING DEBT in thousands of euros

•1 Financial liabilities

Analysis by category of debt	30-June-20	31-Dec-19
Long- and medium-term borrowings	67 251	68 078
Finance leases outside IFRS 16	120	137
Current bank overdrafts	12 154	14 161
Other financial debts (1)	17 985	3 092
Partners' current accounts	1 443	1 726
TOTAL	98 953	87 194

(1) These debts include:

• a financial debt of 2,300 K€ for a put option on minority interests in Robertet Goldfield.

• a financial debt of 4,009 K€ for a put option on minority interests in Sirius.

Analysis by repayment schedule	30-June-20	31-Dec-19
Less than one year (1)	48 570	34 974
More than one year and less than five years	47 610	48 730
More than five years	2 773	3 490
TOTAL	98 953	87 194

Of which in Euros	96 328	84 514
Of which in USD	1 142	1 160
Other currencies	1 483	1 520

(1) The portion of borrowings due within one year breaks down as follows:

	30-June-20	31-Dec-19
Current portion of borrowings	21 101	19 045
Current portion of miscellaneous financial debt	15 315	1 735
Short-term portion of finance leases (excluding IFRS 16)		33
Bank overdrafts	12 154	14 161
TOTAL	48 570	34 974

Loan repayments for the half year amounted to 8,003 K€, compared to 11,989 K€ at the end of the first half

of 2019 and 23,063 K€ at the end of 2019.

Loan subscriptions amounted to 5,000 K€ over the half year.

Fixed-rate and floating-rate borrowings break down as follows :

	30-June-20	31-Dec-19
Fixed rate loans	66 685	67 368
Variable rate loans	566	711
TOTAL	67 251	68 079

•2 Lease Debts

These debts represent the Group's financial liabilities on all of its lease contracts following the implementation of IFRS 16.

	Opening	New contracts and renewals	Repayments and termination	Perimeter entrance	Differences of conversion	Closing
LEASE OBLIGATIONS	13 484	1 614	-1 339	352	-360	13 751
Of which current liabilities	2 357					2 514
Of which non-current	11 127					11 237

Analysis by repayment due date	30-June-20	31-Dec-19
Less than one year	2 514	2 357
More than one year and less than five years	4 876	4 522
More than five years	6 361	6 605
TOTAL	13 751	13 484
Of which in Euros	3 479	2 740
Of which in USD	7 263	7 122
Other currencies	3 010	3 622

NOTE 11 –CURRENT LIABILITIES i n t h o u s a n d s o f e u r o s

	30-June-20	31-Dec-19
Tax and social security liabilities	21 630	23 140
Other liabilities	16 982	10 162
Deferred income	1 744	892
TOTAL	40 357	34 194

NOTE 12 – SECTORAL INFORMATION in thousands of euros

In accordance with IFRS 8, the Group provides segment information as used internally by the PDO (chief operating decision maker). The PDO is the Executive Management of the Robertet Group, chaired by Philippe Maubert.

The Group's level of segment reporting is the business segment. The breakdown is based on the Group's three Divisions :

• •Raw Materials
• •Fragrance
• •Flavors

Internal reporting for the PDO corresponds to the operating segments identified above

As of June 2020
	Raw Materials	Fragrance	Flavors	TOTAL
Consolidated revenue	78 691	97 153	104 364	280 208
Current operating income	11 623	13 499	16 298	41 420
Net income Group share	8 706	9 069	12 320	30 095
GOODWILL	6 741	17 808	7 879	32 428
TANGIBLE FIXED ASSETS & RIGHTS OF USE	48 597	57 470	60 092	166 159

As of June 2019

	Raw Materials	Fragrance	Flavors	TOTAL
Consolidated revenue	79 571	104 193	103 946	287 710
Current operating income	15 143	9 534	16 101	40 778
Net income Group share	10 991	6 741	11 770	29 502
GOODWILL	1 934	17 808	7 879	27 621
TANGIBLE FIXED ASSETS & RIGHTS OF USE	58 279	55 886	53 160	167 325

As of December 2019
	Raw Materials	Fragrance	Flavors	TOTAL
Consolidated revenue	151 313	204 276	198 684	554 273
Current operating income	24 380	18 328	30 336	73 044
Net income Group share	18 079	11 576	23 391	53 046
GOODWILL	1 934	17 808	7 879	27 621
TANGIBLE FIXED ASSETS & RIGHTS OF USE	57 815	59 877	53 668	171 360

NOTE 13 - DEPRECIATION, AMORTIZATION AND PROVISIONS in thousands of euros

	30-June-20	30-June-19	31-Dec-19
Depreciation on fixed assets	10 453	10 093	20 191
Charges and reversals of provisions (1)	4 289	1 271	1 043
TOTAL	14 741	11 364	21 234

(1) charges to and reversals of provisions concern inventories, receivables and provisions for contingencies and charges (see notes 6, 7 and 9).

NOTE 14 – FINANCIAL RESULT i n t h o u s a n d s o f e u r o s

	30-June-20	30-June-19	31-Dec-19
Interest on borrowings and similar expenses	-588	-830	-1 500
Securities products	18	132	329
Net financial cost	-570	-698	-1 171
Foreign exchange losses	-2 170	-508	-2 465
Foreign exchange gains	1 763	1 245	3 511
Other	52	56	100
Other financial income and expenses	-355	794	1 146
TOTAL	-925	96	-26

NOTE 15 – TAXES in thousands of euros

The income tax expense for the six-month period is calculated by applying the estimated average effective rate for the year to the pre-tax income for the period. This calculation is performed individually for each of the Group's consolidated tax entities.

	30-June-20		31-Dec-19
	Net Income before tax	Net tax (expense)/ income	Net Income before tax	Net tax (expense)/ income
French companies of the Group	20 491	-6 178	41 275	-13 299
Other Group companies	20 026	-4 830	31 824	-7 946
TOTAL	40 517	-11 008	73 099	-21 245

	30-June-20	31-Dec-19
Current tax	-10 942	-22 280
Net deferred tax	-66	1 035
TAX	-11 008	-21 245

Tax assets and liabilities can be analyzed as follows :

	30-June-20	31-Dec-19	Variation
Deferred tax assets	1 296	1 423	-127
Deferred tax liabilities	8 413	8 177	236
Net deferred tax	-7 117	-6 754	-363

	30-June-20	31-Dec-19
Net deferred taxes as of January 1 (assets/liabilities)	-6 754	-8 480
Recognized in shareholders' equity	-51	646
(Expense)/income	-66	1 035
Conversion differential	-243	44
Other	-4
TOTAL	-7 117	-6 754
Of which deferred tax liabilities	8 413	8 177
Of which deferred tax assets	1 296	1 423

NOTE 16 – CASH EQUIVALENTS in thousands of euros

Net cash and cash equivalents	30-June-20	30-June-19	31-Dec-19
Availability	122 996	95 922	101 611
Marketable securities	15 832	8 957	9 825
Bank overdrafts	-12 154	-27 843	-14 161
TOTAL	126 674	77 036	97 275

Marketable securities consist of certificates of deposit and other short-term, liquid investments with maturities of less than three months :

	31-Dec-19	Variation	Conversion differential	30-June-20
Marketable securities	9 825	6 878	-870	15 832
TOTAL	9 825	6 878	-870	15 832

Analysis of changes in working capital requirements	31-Dec-19	Flux foreign exchange	Cash Flows	30-June-20
Inventories and work-in-progress	193 691	457	-6 891	187 257
Trade and other receivables	138 400	9 517	4 290	152 208
Trade and other payables	-73 784	-10 123	6 525	-77 383
Gross working capital requirement	258 307	-149	3 924	262 082
Depreciations	-11 730	-106	-3 912	-15 748
Net working capital requirement	246 577	-255	12	246 334

NOTE 17 - CALCULATION OF EARNINGS PER SHARE

Calculation of basic and diluted earnings per share for the periods ended June 30, 2020 and December 31, 2019 and June 30, 2019 is presented below :

Basic earnings	30-June-20	31-Dec-19	30-June-19
Net income attributable to the Company's shareholders (in thousands of euros)	30 095	53 045	29 422
Weighted average number of common shares and investment certificates outstanding (in thousands)	2 309	2 310	2 306
Basic net income per share (in euros)	13,04	22,96	12,76

Diluted earnings per share	30-June-20	31-Dec-19	30-June-19
Net income attributable to the Company's shareholders (in thousands of euros)	30 095	53 045	29 422
Weighted average number of common shares and investment certificates in circulation (in thousands)	2 309	2 310	2 306
Weighted average number of shares used to calculate diluted earnings (in thousands)	2 309	2 310	2 306
Diluted earnings per share (in euros)	13,04	22,96	12,76

NOTE 18 – INFORMATION REGARDING RELATED PARTIES

Transactions with affiliated companies are solely purchases and sales of raw materials between the parent company and these companies. The parent company's purchases from these affiliated companies amounted to 1,976 K€ for the first half of 2020 (no sales for the half year).

Concerning the compensation of executive corporate officers, in order to take into account the situation related to Covid 19, it has been decided that the variable compensation of Directors paid in 2020, which initially increased due to their calculation mechanisms, will be reduced by 25%.

In addition, a bonus share plan has been set up as follows, authorized by the Board of Directors on June 5, 2020:

	Date of plan	Number of shares	Conditions of acquisition	Date of acquisition	Date of availability
Philippe MAUBERT	05/06/2020	450	gratuity	05/06/2021	05/06/2023
Christophe MAUBERT	05/06/2020	250	gratuity	05/06/2021	05/06/2023
Olivier MAUBERT	05/06/2020	250	gratuity	05/06/2021	05/06/2023
Lionel PICOLET	05/06/2020	280	gratuity	05/06/2021	05/06/2023

Bonus shares granted to each executive director during the fiscal year

In addition, the bonus share plan granted in June 2019 was definitively vested by each executive corporate officer during this six-month period :

	Date of plan	Number of shares	Conditions of acquisition	Date of acquisition	Date of availability
Philippe MAUBERT	05/06/2019	700	gratuity	05/06/2020	05/06/2022
Christophe MAUBERT	05/06/2019	400	gratuity	05/06/2020	05/06/2022
Olivier MAUBERT	05/06/2019	400	gratuity	05/06/2020	05/06/2022
Lionel PICOLET	05/06/2019	450	gratuity	05/06/2020	05/06/2022

Bonus shares acquired by each executive corporate officer during the year

Note 23 of the 2019 annual report details these remunerations.

NOTE 19 - SEASONALITY

The Group's business is not highly seasonal. The contribution of the first half of the year to annual revenues is historically slightly higher than that of the second half.

N O T E 20 - L I S T O F C O N S O L I D AT E D S U B S I D I A R I E S

Entity	Country	% of Ownership	% Control	Consolidation Method
Robertet GMBH	Germany	100%	100%
Robertet Argentina	Argentina	100%	100%
Robertet Do Brasil	Brazil	100%	100%	N
Robertet Espana	Spain	100%	100%	O
Robertet USA	United States	100%	100%	I
Robertet Italia	Italiy	100%	100%	T
Robertet Hiyoki	Japan	100%	100%
Robertet de Mexico	Mexico	100%	100%	A
Robertet UK	United Kingdom	100%	100%	D
Robertet et Cie SA	Switzerland	100%	100%	I
Robertet Turkey	Turkey	100%	100%	L
Robertet South Africa Aromatics	South Africa	100%	100%	O
Arco	France	100%	100%	S
Charabot China	China	100%	100%	N
Charabot Japon	Japan	100%	100%
Charabot Corée	Korea	100%	100%	O
Robertet China	China	100%	100%	C
Robertet India	India	100%	100%
Plantes Aromatiques du Diois	France	100%	100%	L
Robertet Bulgaria	Bulgaria	100%	100%	L
Robertet Andina	Colombia	100%	100%	U
Robertet Asia	Singapore	100%	100%	F
Robertet Goldfield	India	60%	100%
Robertet Indonésie	Indonésia	100%	100%
Robertet Africa	France	78%	78%
Sirius	France	60%	100%
Hitex	France	50%	50%	EQUITY
Bionov	France	100%	50%	METHOD

BUSINESS REPORT FOR THE FIRST HALF OF 2020

PERIOD ENDING 30 JUNE 2020

BUSINESS REPORT FOR THE FIRST HALF-YEAR OF 2020

The year 2020 had begun with a relatively positive outlook for all the company's activities.

Thus, as of March 31, 2020, consolidated sales were up 3%, and Flavors in particular were up 7%.

At the end of June, this figure, although generally sustained in the context, had declined slightly, down 2.6% (4.3% at constant scope of consolidation and exchange rates).

This decline was mainly due to the impact of the Covid health crisis on economic activity in general.

This trend has been consistent and reflects the activity of end consumers.

Robertet has managed to have sustained economic activity during confinement thanks to the reliability of staff its personnel in France and abroad.

This is also due to the fact that we operate in a priority business sector (health, sanitary and human food) and that the Group has been able to take the organizational measures necessary for the operation of its plants and supply chain in strict compliance with regulations that are constantly changing and require constant adjustments.

This policy has been pursued during the de-confinement and in the current phase of heightened vigilance.

By operating division, at constant exchange rates and scope of consolidation, revenue for the half year breaks down as follows: Natural Raw Materials down 8.2%, Perfumes down 5.4%, but Flavors remained stable.

This breakdown is largely attributable to lower sales in the high-end Perfumes market and also to the sharp decline in consumer beverage sales.

By geographic region, sales in France decreased by 7.5% and in the United States by 2.6% in dollars. A sharp decline was recorded in Spain, England and Brazil.

Sales, on the other hand, were sustained in Southeast Asia through the recent subsidiary in Singapore and also in China and Japan.

The Health and Beauty Division's activity is also very positive as part of its steadily growing business plan.

In addition, the merger of Charabot into Robertet was effective, effective January 1, 2020, which was beneficial to the Group's cost structure materializing a number of synergies in the operating account.

It should be noted that the gross margin on products improved significantly during the first half of the year and savings in management expenses were significant.

This allowed the Group's consolidated profit to increase significantly, even though it suffered a drop in revenues.

It amounts to 30.1 million for the first six months, an increase of 2.3% which is evenly spread over most of the Group's entities.

The Group's PNL is therefore fairly homogeneous. Notably, EBITDA amounts to 56.2 million euros, i.e. nearly 20% of revenues and net profit to 11% of the same figure.

For the year as a whole, it should be taken into account that this result contains certain seasonal elements. Caution should therefore be exercised in extrapolating these results for the full year 2020, given the persistence of strong uncertainties about the environment in which the Group will operate.

Consequently, excluding exceptional items, a stable annual result would already be a good performance.

Another element of its strategy is that the group has regularly built a solid structure with a remarkable financial equilibrium.

This is particularly valuable in more difficult periods, having long-term goals. This debt-free balance sheet is primarily intended as an instrument for seeking growth within the framework of reasonable management.

The Group continued its search for growth by continuing to develop its simple and clear concept of New Products/New Markets and by taking maximum advantage of synergies between the Divisions and the main zones (One Robertet policy).

This goes hand in hand with the search for external growth opportunities in its core business that can strengthen or complete its range of products, always with the strong predominance of Natural products, in which the Group continues to invest, with Bio or Organic as a top priority.

An active search remains for assets that can integrate the Health and Beauty Division into a very targeted and reasonable framework.

CERTIFICATION BY THE PERSON RESPONSIBLE FOR THE INTERIM FINANCIAL REPORT

PERIOD ENDING 30 JUNE 2020

CERTIFICATION BY THE PERSON RESPONSIBLE FOR THE INTERIM FINANCIAL REPORT 2020

Monsieur Philippe MAUBERT

Chairman of the Board of Directors.

I certify that, to the best of my knowledge, the financial statements have been prepared in accordance with applicable accounting standards and give a true and fair view of the assets, liabilities, financial position and results of the company and of all the companies included in the consolidated financial statements, and that the interim management report gives a true and fair view of the significant events that occurred during the first six months of the fiscal year, their impact on the interim financial statements, the main related party transactions and the outlook for the remaining six months of the fiscal year.

Grasse , le 22 septembre 2020 Philippe MAUBERT Chairman of the Board of Directors.

STATUTORY AUDITORS' REPORT

PERIOD ENDING 30 JUNE 2020

COGEPARC

Membre de PKF International Le Thélémos 12 quai du Commerce 69009 LYON

DELOITTE & ASSOCIÉS

6, place de la Pyramide 92908 Paris-la Défense Cedex S.A.S. au capital de 2 188 160 € ROBERTET 572 028 041 RCS Nanterre

Société Anonyme 37 avenue Sidi- Brahim 06130 GRASSE

Statutory auditors' report on the half-year financial information

Period from 1 January 2020 to 30 June 2020

To the shareholders of the company Robertet,

In execution of the mission entrusted to us by the general meeting and in application of article L. 451-1-2 III of the French Monetary and Financial Code, we have proceeded with :

• the review of the accompanying condensed interim consolidated financial statements of the company for the period from January 1, 2020 to June 30, 2020 ;
• verification of the information given in the half-yearly activity report.

These condensed interim consolidated financial statements were prepared under the responsibility of the Board of Directors on September 22, 2020 on the basis of the information available at that date in a changing context of the crisis related to Covid-19 and difficulties in understanding its impact and future prospects. It is our responsibility, on the basis of our review, to express our conclusion on these financial statements.

•Conclusion regarding the financial statements

We conducted our review in accordance with professional standards applicable in France. A review of interim financial information consists principally of making inquiries of persons responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit. The scope of the audit is the same as that required for an audit performed in accordance with the professional standards applicable in France. Consequently, the assurance that the financial statements, taken as a whole, are free from material misstatement obtained through a limited review is a moderate assurance, less than that obtained during a full audit.

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

•Specific verification

We have also verified the information given in the interim management report dated September 22, 2020 containing notes to the condensed interim consolidated financial statements subject to our review. We have no matters to report as to its fair presentation and consistency with the condensed half-year consolidated financial statements.

Lyon and Marseille, September 29, 2020. The Statutory Auditors

Member of PKF International Anne BRION TURCK Philippe BATTISTI

COGEPARC DELOITTE & ASSOCIĒS

ROBERTET GROUP

FRANCE

ROBERTET GRASSE 37, avenue Sidi Brahim BP 52100 06130 Grasse Cedex France www.robertet.fr E-mail : info@robertet.fr

CHARABOT 10 Avenue Yves-Emmanuel Baudoin BP 22070 06131 Grasse Cedex France E-mail : contact@charabot.fr

ROBERTET PARIS 21 Rue Émile Ménier 75116 Paris France

SAPAD 26340 Vercheny

HITEX SAS 56000 Vannes

BIONOV 84900 Avignon

SUBSIDIARIES

USA

Robertet Flavors Inc

Robertet Fragrances Inc

Robertet Fragrances Inc. New York Creative Center

EUROPE

GERMANY Robertet GMBH

SPAIN Robertet España SA

UNITED KINGDOM Robertet UK Ltd.,

ITALY Robertet Italia Srl

SWITZERLAND Robertet SA

SOUTH AMERICA

ARGENTINA Robertet Argentina

BRASIL Robertet do Brasil Ind. e Com. Ltda

C O L O M B I A

ASIA

TURKEY Robertet Gulyagi ve

Robertet Aroma ue esens Istanbul

CHINA Robertet Flavors & Fragrances (Beijing) CO., LTD.

INDIA Robertet Flavours & Fragrances Pvt. Ltd. Robertet Goldfield India

JAPAN Robertet Japan

VIETNAM Robertet Vietnam Representative Office Hochiminh City

AFRICA

SOUTH AFRICA Robertet South Africa Aromatics Ltd.