Solvac S.A. — Audit Report / Information 2019

Feb 27, 2020

Solvac: Increase in net profits of 4.4 % compared to 2018

1. The corporate Solvac S.A. 2019 net income is up 4.4% compared to 2018 (see point 3 on page 2). The cash revenue1, including the inflow of dividends from its participation in Solvay, came to €121.9 million versus €117.1 million in 2018, namely, an increase of 4.1% attributable to the increase of Solvay dividend as shown in the table below:

	2018	2019
Solvay dividend per share – January (in EUR)	1.38	1.44
Number of Solvay shares held by Solvac (in million)	32.5	32.5
Solvay dividend received in January (in million EUR) (a)	44.9	46.8
Solvay dividend per share – May (in EUR)	2.22	2.31
Number of Solvay shares held by Solvac (in million)	32.5	32.5
Solvay dividend received in May (in million EUR) (b)	72.2	75.1
Cash revenue (a) + (b) 1 (in million EUR)	117.1	121.9
Operating expenses (in million EUR)	-1.4	-1.5
Cost of borrowing (in million EUR)	-3.9	-3.6
Cash income 1 (in million EUR)	111.8	116.8

Insofar as the company statutory accounts authorise, it is on the basis of cash income, after covering expenses (primarily financial charges), that the Board of Directors determines the amounts proposed for distribution by Solvac.

1. The Board of Directors has prepared the Solvac consolidated financial statements at December 31, 2019. These accounts have been submitted to the Statutory Auditor. They are presented according to IFRS standards.

Consolidated income statement

EUR million	20183	2019
Income from investments accounted for under the equity method	276.5	37.2
Operating expenses	-1.4	-1.5
Cost of borrowings	-3.9	-3.6
Net income	271.2	32.1
Net earnings and diluted earnings per share (EUR)2	12.7	1.5

¹ Solvac uses certain non-IFRS performance indicators that are defined here:

• Cash revenue refers to income received during the period. It is defined as the cash flow obtained by the payment of dividends received from Solvay.

• Cash income means the cash revenue reduced by the interest charges and other income and expenses (financial/operational). It is on the basis of this indicator that the Board of Directors determines the amounts proposed for distribution by Solvac. See detail of calculation

in note 15, page 16 of current press release. 2 The net income per share and the net diluted income per share are identical. The average weighted number of shares used for the calculation per share was 21,375,033 in 2018 and in 2019

3 The numbers presented –for comparison- have been restated to consider the application of IAS12 Income Tax at Solvay (see page 8)

Solvac recorded for the year end December 31, 2019 net consolidated income of €32.1 million (namely, €1.5 per share) versus €271.2 million (namely, €12.7 per share) in 2018, as a result of the change in income from applying the equity method to Solvay.

The 2019 net result of the participation calculated by the equity method is lower than in 2018, as a result of a small decrease of the underlying EBITDA of €8 million and the impairment of the Oil and Gas activities at €825 million before taxes or €658 million after taxes.

1. The Board of Directors reports the figures of the statutory accounts relating to Solvac SA in 2019 :

EUR thousand	2018	2019
Financial result	115,093	120.220
Operating result	-1,404	-1.496
Profit before tax	113,689	118.724
Profit after tax	113,688	118.724
Gross payment to shareholders	111,578	118.724
Retained earnings	2,110	2.444

The 2019 net income is € 118.7 million (versus € 113.7 million in 2018) attributable to the increase in dividends per share paid or decided by Solvay and a decrease of the financial charges of Solvac.

1. Two interim dividend payments were made, respectively on August 27, 2019 and on December 27, 2019, the second representing in principle the balance due, which the General Shareholders Meeting will be asked to approve. In total, each share received in 2019 a gross compensation increasing by 4.2% compared to 2018 :

EUR	2018	2019
A first deposit	3.00	3.13
A second deposit	2.22	2.31
Gross dividend per share	5.22	5.44

1. The Board of Directors of Solvay decided on February 25, 2020 to pay on May 23, 2020 the balance due on the dividend for the financial year 2019, which comes to € 2,25 gross per share.

Taking into account the interim dividend of € 1.50 paid in January 2020, the gross dividend of Solvay reaches € 3,75 for the fiscal year 2019, unchanged compared to the gross dividend for the fiscal year 2018.

NOTES

1. Report of the statutory auditor

Deloitte confirmed that its audit work on the consolidated financial statements of Solvac SA, in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium, is substantially completed. Deloitte confirms that the financial information contained in this press release requires no comment on its part and is consistent with the consolidated financial statements of Solvac SA. The full audit report of the consolidated financial statements and the full report of the Commissioner on the audit of the annual financial information included in the annual report 2019 will be published on the internet (www.solvac.be) on April 1, 2020.

2. Content

This press release contains regulated information and is drafted in compliance with the applicable IFRS standards. The risk management analysis is included in the notes to the consolidated financial statements as well as in the annual report, which will be available on the Internet (www.solvac.be).

3. Solvac shares

	2018	2019
Number of shares issued at the end of the period	21,375,033	21,375,033
Average number of shares for calculating IFRS earnings per share	21,375,033	21,375,033
Average number of shares for calculating IFRS diluted earnings per share	21,375,033	21,375,033

4. Statement by the responsible persons

M. JP. Delwart, Chairman of the Board of Directors, and M. B. de Laguiche, Managing Director of Solvac, confirm that to the best of their knowledge:

a) the annual financial statements, prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, the financial position and the profit or loss of the issuer and of the undertakings included in the consolidation;

b) the management report includes a fair review of the development and performance of the business and the position of the issuer and of the undertakings included in the consolidation, together with a description of the principal risks and uncertainties that it faces;

Key dates for financial communications

• April 1, 2020:	Publication of the 2019 annual report on www.solvac.be
• May 12, 2020:	Ordinary General Meeting of the Shareholders (2:30 pm)
• July 30, 2020:	Result from the first half of 2020 and announcement of the first interim dividend for financial year 2020
• August 17, 2020:	Payment of the first interim dividend for financial year 2020
• December 11, 2020:	Announcement of the second interim dividend for financial year 2020
• December 29, 2020:	Payment of the second interim dividend for financial year 2020

For more information, please contact:

SOLVAC S.A. Investor Relations Champs Elyséesstreet, 43 B - 1050 Brussels Tel.: 32/2/639 66 30 Fax: 32/2/639 66 31 Email: Investor.relations@solvac.be

Dit persbericht is ook in het Nederlands beschikbaar - Ce communiqué de presse est également disponible en français

Solvac – Consolidated financial statements

The financial statements that follow were approved by the Board of Directors on February 27, 2020. They were prepared in compliance with IFRS accounting standards described in the following pages.

Consolidated income statement

EUR million	Notes	20181	2019
Income from investments accounted for under the equity method	(1)	276	37
Operating expenses		-1	-1
Cost of borrowings	(2)	-4	-4
Net income		271	32
Net earnings and diluted earnings per share (EUR)	(3)	12.7	1.5

Statement of total comprenhensive income

EUR million	Notes	2018	2019
Net income		271	32
Other comprehensive income2
Recyclable components
Gains and losses on hedging instruments in a cash-flow hedge		-15	2
Currency translations differences (activities abroad)		68	51
Non-recyclable components
Gains and losses on equity instruments remeasured at fair value through other comprehensive income		1	0
Remeasurement of the net defined benefit liability		8	-51
Income tax relating to components of other comprehensive income
Income tax relating to components of other comprehensive income.		1	15
Other comprehensive income net of related tax effects		63	17
Comprehensive income	(4)	334	49

1 The numbers presented –for comparison- have been restated to consider the application of IAS12 Income Tax at Solvay (see page 8)

² Other elements of the comprehensive income come from the statement of changes in equity of Solvay S.A. More information is available in the latter's press release.

Cash flow statement

EUR million	Notes	2018	2019
Net result		271	32
Cost of borrowings		4	4
Income from investments accounted for under the equity method	(1)	-276	-37
Changes in working capital		0	0
Dividends received from Solvay		117	122
Cash flow from operating activities		116	121
Acquisition of Solvay shares	(1)	0	0
Sale of Solvay shares		0	0
Cash flow from investing activities		0	0
Capital increase		0	0
Acquisition of treasury shares		0	0
Increase in borrowing	(2) (5) (11)	92	40
Repayment of borrowing	(2) (5) (11)	-91	-42
Interest paid	(2)	-4	-4
Dividends paid	(6)	-112	-116
Changes in taxes linked to dividends paid		0	0
Cash flow from financing activities		-115	-122
Net changes in cash and cash equivalents		1	-1
Opening cash balance		0	1
Closing cash balance		1	0

Statement of financial situation

EUR million	Notes	2018	2019
ASSETS
Tangible assets		0	0
Non-current assets : investments in associates	(1)	3,655	3,334
Goodwill	(1)	343	343
Investments in associates excluding goodwill		3,312	2,991
Current assets : short-term receivables	(7)	47	49
Cash and cash equivalents		1	0
Total assets		3,703	3,383
EQUITY AND LIABILITIES
Equity	(8)	3,493	3,175
Capital		192	192
Reserves		3,301	2,983
Non-current liabilities : long term financial debt	(2) (11)	150	150
Current liabilities		60	58
Short-term financial debts	(5) (11)	42	40
Tax liabilities		14	14
Other current liabilities		4	4
Total equity and liabilities		3,703	3,383

Statement of changes in equity

EUR million	Capital	Issue premiums	Treasury shares	Coupon of Perpetual Hybrid Bond	Retained earnings	Currency translation, fair value differences and defined benefit pension	Total equity
Balance at 31/12/2017	192	568	0	675	2,235	-459	3,211
Profit of the year1					271		271
Other elements of the comprehensive income						63	63
Comprehensive income					271	63	334
Dividends					-112		-112
Coupon of Perpetual Hybrid bond				88			88
Acquisition / sale of treasury shares							0
Scope and other variations					-28		-28
Balance as at 31/12/2018	192	568	0	763	2,366	-396	3,493
Impact of Adoptation of IFRS 16 by Solvay					3		3
Balance remeasured at 31/12/2018	192	568	0	763	2,369	-396	3,496
Profit of the year					32		32
Other elements of the comprehensive income						17	17
Comprehensive income					32	17	49
Dividends					-116		-116
Coupon of Perpetual Hybrid bond				-219	-1		-220
Acquisition / sale of treasury shares							0
Scope and other variations					-34		-34
Balance as at 31/12/2019	192	568	0	544	2,250	-379	3,175

1 The numbers presented –for comparison- have been restated to consider the application of IAS12 Income Tax at Solvay (see page 8)

Notes to the consolidated financial statements

IFRS accounting policies

The primary accounting policies used in the preparation of these consolidated financial statements are the following:

1. General information and applicable IFRS standards

Solvac is a "société anonyme" under Belgian law and quoted on Euronext Brussels. The company's main activity is its 30.71% shareholding in Solvay SA.

The consolidated financial statements for the financial year ending December 31, 2019 have been prepared in accordance with IFRS (International Financial Reporting Standards) as adopted by the European Union.

Mandatory changes of accounting methods

No changes have been made to the accounting principles compared to those used for the preparation of the last consolidated financial statements established on December 31, 2018, with the exception of the following standards applicable for the annual period beginning on or after January 1st, 2019 and detailed below.

As of January 1, 2019, the Group applied, for the first time, IFRS 16 Leases, the amendments to IAS 12 Income Taxes as part of the annual improvements to IFRS standards 2015–2017 cycle, (and IFRIC 23 Uncertainty Over Income Tax Treatment). Several other amendments and interpretations apply for the first time in 2019 (including Interest Rate Benchmark Reform, which amends IFRS 9 Financial Instruments, IAS 39 Financial Instruments: Recognition and Measurement, and IFRS 7 Financial Instruments: Disclosures) but do not have a more than insignificant impact on the consolidated financial statements of the Group.

The nature and the effects of those changes are presented here below. Several other modifications and interpretations are applicable for the first time in 2019, but had an insignificant impact on the consolidated financial statements.

At January 1st, 2019 the IFRS16 replaces the IAS17 standard on the leasing contracts. IFRS16 sets the principles for the accounting, the evaluation, the presentation and the publishing of the leasing contracts, and the standard obliges the lessees to state the leasing contracts following a unique balance, similarly to the accounting of contracts of financial leasing contracts following IAS17. At the effective date of the contract, the lessees accounts a leasing liability (an obligation to pay the leasing amounts) and an asset under the right of use (an asset representing the right to utilize the asset during the length of the leasing contract). At Solvay, applying this new standard had an impact on the tangible assets accounting and the financial liabilities. The impact accounted for in the equity amounts at €8 million (at 100%), being €2,5 million (the Group's share) at January 1st, 2019.

On top, from January 1st, 2019, the Group applies the changes introduced by IAS12 to the tax consequences of the dividends accounted for from the opening of the first comparative period, being January 1st, 2018. In 2018, the fiscal consequences of the coupons of the perpetual hybrid bonds, accounted for in equity, have been capitalized in equity. Following the adoption of changes, the fiscal consequences will be recognized in the income statement. Therefore the Solvay result of 2018 has been increased with €19 million (at 100%), or €6 Million (the Group's share).

The impact of the future application of these standards and the interpretations on the Solvay Group accounts is more detailed in its annual financial report.

Standards in force after the closing date of the financial year

Solvac did not anticipate application of new and amended standards and interpretations which come into force after December 31st, 2019, namely:

• Amendments to IAS 1 and IAS 8 Definition of "Material" (applicable for annual periods beginning on or after January 1st, 2020)

• Amendments to IFRS 3 Business Combinations (applicable for annual periods beginning on or after January 1st, 2020, but not yet endorsed in the EU)

• Amendments to references to the Conceptual Framework in IFRS standards (applicable for annual periods beginning on or after January 1st, 2020)

• IFRS 17 Insurance Contracts (applicable for annual periods beginning on or after January 1st, 2021(1), but not yet endorsed in the EU).

The impact of future application of these standards and interpretations on the financial statements of Solvay Group is set out in detail in its annual report. Their application at the level of Solvac should not have any significant impact on the consolidated financial statements.

2. Consolidation

Since the Board of Directors believes that Solvac has a significant influence on Solvay, the shareholding in Solvay S.A. has been integrated into Solvac's consolidated financial statements using the equity method. This method takes into account the Solvac S.A. share in the financial statements of the Solvay Group, prepared on December 31st of the financial year using Solvay's IFRS accounting standards (cfr Solvay Annual Report). According to the equity method, a shareholding in an associated company is initially reported at cost in the consolidated statement of the financial situation, then it is adjusted later to account for the Group share in the net revenue and the other elements of the total revenue of the associated company.

3. Segment information

Given the nature of the holding company, there is no need to present segment or geographical information. The data on shareholding in Solvay is available in the Solvay S.A. financial statements.

4. Impairment of assets

At the end of each accounting year, the Group reviews the book value of its share for indications of the potential impairment of assets. If such indications exist, the recoverable value of the asset is estimated in order to establish the extent of any impairment loss.

5. Financial instruments

Bank loans

Bank loans and overdrafts are accounted for in the net amount received. Financial expenses, including any settlement or redemption premiums, are covered for the estimated period of availability.

Cash and cash equivalents

Cash and cash equivalent consist of cash and demand deposits, short-term investments (less than 3 months) and highly liquid investments readily convertible into known amounts of cash or subject to an insignificant risk of any change in value.

Other receivables

Other receivables follow a management model with the objective of collecting the contractual cash flows. They are measured at amortized cost, that is, the amount of initial recognition plus or minus accumulated amortization of any difference between this initial amount and the amount at maturity, and reduced by any impairment loss or non – recoverability.

The other receivables are recorded under "Current assets – short term receivables".

¹ The June 2019 draft proposes to postpone the date of entry into force in the EU to January 1st, 2022

6. Recognition of revenue

Revenue is recognized when it is likely to be acquired and as soon as its value can be reliably measured. Interest earnings are recorded in the income statement on a pro rata basis taking account of the effective interest rate of the investment.

7. Estimates and significant judgments when applying an accounting method

Over and above the estimates and significant judgments made by Solvay when applying accounting methods (see Solvay's Annual Report), the key estimate made by the Board of Directors on December 31st, 2019 concerns the recoverable value of its holding in Solvay. An impairment test is performed if there is any indication that the investment may be impaired. The impairment test involves comparing the book value of the investment to its market value. In the event of a crisis on the market with excessive price volatility, reference may be made in addition to the "target prices" for Solvay shares, as estimated by financial analysts.

As of the close of the financial year, Solvac considers that there was no sign of a loss of value. Therefore, no investment impairment test was conducted.

Finally, the Board of Directors believes that Solvac has a significant influence and therefore consolidates the accounts of this group according to the equity method.

8. Risk management

Solvay underlying risk – The sole investment of Solvac being its investment in Solvay, the primary risks to which the Company is exposed are similar to those of Solvay. The financial situation and results of Solvac are influenced by the results of Solvay, either through the dividends received (financial statements) or through consolidation using the equity method (consolidated accounts).

Valuation risk - Solvac is exposed to market risk (changes in Solvay's share price). Although the share price is subject to market volatility, the Board considers that in the long run, it constitutes a reliable indicator of valuation. The book value of the Solvay shares on the Solvac consolidated balance sheet is € 102.56 per share including goodwill (€ 82.73 in the statutory accounts).

Rate risk – Solvac is exposed to an interest rate risk resulting from bank loans at fixed rates for a total of € 150 million. The company monitors this risk through the periodic calculation of the fair market values of these loans.

Liquidity risk – Solvac is exposed to liquidity risk, particularly when it has to resort to short term bank loans. The short-term debt, moderate, has been decreased compared to last year (€ 40 million at end 2019 against € 42 million at end 2018) and it was repaid as follows: € 33 million at January 21st, 2020 (when Solvay did its first dividend payment) and € 7 million in May 2020 (when Solvay pays the dividend balance). Not only is short-term debt of short duration, but furthermore on average over the year, the company experiences a situation of a positive average shortterm cash position1. Therefore, the Board is confident of the ability of Solvac to raise the funds needed in the short term and repay them with the flow of dividend paid by Solvac.

Counterparty risk - This is the bank counterparty risk relating to cash deposits and available assets. The counterparties of Solvac are banks with a minimum rating of A.

¹ The average net cash position is a non-IFRS performance indicator which is defined as the sum of all short-term funding (-) , commercial paper investments (+) and cash on current account in the current year weighted by their respective duration.

Notes to the consolidated financial statements

(1) Investments in associates

Solvac holds a 30.71 % stake in Solvay. Nevertheless the percentage used in the consolidated statements is 31.44 % because the treasury shares held by Solvay are deducted from the total amount of shares representing the capital of Solvay. Solvay S.A. is a "société anonyme" under Belgian law and quoted on Euronext in Brussels and Paris. The Solvay Group is an international chemical group.

The value of the holding under the equity method amounts to € 3,334 million (of which € 343 million EUR is goodwill and € 2,991 million of value excluding goodwill). Based on the stock exchange price of December 31st, 2019 the value amounts to € 3,358 million.

Changes in goodwill are as follows:

EUR million	2018	2019
Value at 1 January	343	343
Sold during the year	0	0
Acquired during the year	0	0
Value at 31 December	343	343

Goodwill corresponds to the difference between the sum of the acquisition costs of Solvay shares and the sum of the values of Solvay's equity per share acquired.

The changes in shareholding using the equity method excluding goodwill are as follows:

EUR million	2018	2019
Value at 1 January	3,033	3,312
Sold during the year	0	0
Acquired during the year	0	0
Result	276	37
Distribution	-119	-124
Currency translation differences	68	51
Fair Value differences	-5	-34
Change in consolidation scope and others	-29	-31
Hybrid loan	88	-220
Value at 31 December	3,312	2,991

In 2018 and 2019, Solvac has not acquired any Solvay shares.

In 2019, the share of Solvac in the net income of the Solvay Group, excluding minority interests, amounted to € 37 million (2018: € 276 million). In 2019, the share of Solvac in the results from "Discontinued Operations" amounted to € 74 million (2018: € 63 million).

The value of the investment at December 31st corresponds to Solvay's equity listed in "Solvay Shareholders" 1 multiplied by the holding percentage (31.44 % in 2019 and 31.52 % in 2018).

¹ This is the equity of Solvay reduced by the non-controlling interests.

The condensed consolidated financial statements of the Solvay Group are the following:

EUR million	2018	2019
Financial position
Non-current assets	15,426	15,035
Current assets	6,574	6,272
Cash and cash equivalents	1,103	809
Assets	22,000	21,307
Equity	10,624	9,625
Solvay stock holders	10,507	9,515
Non-controlling interests	117	110
Non-current liabilities	7,474	7,592
Long term financial debt	3,180	3,382
Current liabilities	3,902	4,091
Short term financial debt	630	1,132
Equity and liabilities	22,000	21,307
Income statement
Sales	10,257	10,244
Result from continuing operations	697	-80
Result from discontinued operations	200	236
Net income for the year	916	156
Non controlling interests	-39	-38
Net income (Solvay share)	877	118
Comprehensive income
Other comprenhensive income	204	55
Total comprehensive income	1,120	211
Dividends received	119	124

(2) Long-term debt

Debts with a maturity of more than one year remain stable compared to 2018 and amount to € 150 million (loans from BNP Paribas Fortis) as of December 31st, 2019. This represents the structural indebtedness of Solvac: a loan of € 50 million (maturing in 2022; fixed rate of 2.90%) and a loan of € 50 million (maturing in 2023; fixed rate of 1.50%) and a loan of € 50 million (maturing in 2025; fixed rate of 2.75%). The interest on loans longer than one year amounted to € 3,6 million for the financial year 2019.

(3) Net earnings per share

The net earnings per share and diluted net earnings per share are identical. The number of Solvac shares was 21,375,033 at the end of 2019 (21,375,033 at the end of 2018).

(4) Total income

The primary changes are related to the assessment of the obligations under defined employee benefit plans in accordance with the revised IAS 19 and conversion differences related to Solvay, investments accounted for under equity method.

(5) Short-term borrowing

Short-term borrowing decreased with € 2 million compared to 2018. Short term financial debt at December 31st, 2019 consists of a "Straight Loan" contracted on December 27th, 2019 for an amount of € 40 million (maturing at January 21st, 2020 for € 33 million and at May 23rd, 2020 for € 7 million) to finance the dividend balance paid on December 27, 2019.

(6) Dividends paid

The dividends paid (€ 5.44 gross per share, compared to EUR 5.22 per share in 2018) during the period amounted to € 116 million including the interim 2019 dividend paid on August 27, 2019 (€ 67 million) and the second instalment of the 2019 dividend paid on December 27, 2019 (€ 49 million).

(7) Short-term receivables

This primarily consists of the interim dividend to be received from Solvay in January 2020.

(8) Equity

Total equity amounts to € 3,175 million. It was mostly impacted during financial year 2019 by:

• the payment of the two interim dividends of € 5.44 gross per share (€ 5.22 gross per share in 2018), for a total amount of € 116 million;

• the share in certain items of the total income coming from Solvay (€ 51 million relating to conversion rate differences and actuarial losses from the pension plans for € 36 million net of taxes);

• the impact of Solvay's hybrid bond for € -220 million, and

• the consolidated income of the period of € 37 million.

Reference is made to the proposal of beneficiary allocation that will be presented in the annual management report.

(9) Treasury shares

In 2019, Solvac did not acquire any treasury shares.

(10) Financial instruments

	2018			2019
EUR million	Net carrying amount	Fair value	Net carrying amount	Fair value
Receivables (including cash and cash equivalents)	48	48	49	49
Financial liabilities measured at amortized cost (includes trade liabilities)	210	214	208	212

In order to reflect the importance of the data used when estimating fair market value, Solvac classifies these valuations according to a hierarchy consisting of the following levels:

• level 1: the prices (non adjusted) quoted on the securities markets for identical assets or liabilities;

• level 2: data other than the prices quoted at level 1 which are observable for the asset or liability concerned, either directly (namely, prices) or indirectly (namely data derived from prices);

• level 3: data relating to the asset or liability which are not based on the observable data of the market (nonobservable data).

For receivables, book value is a good approximation of fair market value. With regard to financial liabilities at an amortised cost, the net book value of the long-term financial debt (€ 150 million, see note 2) is less than their fair value (estimated at € 154 million). The fair market value of the fixed interest debt was calculated using the Discounted Cash Flow method. The net book value of other financial liabilities is a good approximation of their fair market value. Thus, the determined fair market values are categorised as Level 2 in the fair market value hierarchy.

(11) Change of financial liabilities

The tables below mention the reconciliations in 2019 and 2018 between the financial debts included in the consolidated balance sheet and the amounts from the consolidated statement of cash flows:

EUR million	At 1 January 2019	Cash flow variation	At 31 December 2019
Long term financial debt	150	0	150
Short term financial debt	42	-2	40
Total	192	-2	190

The cash flow variation mentioned in the table here below reconciles with the consolidated statement of cash flows as follows:

EUR million	At 31 December 2019
Cash flow variation	-2
Of which : Increase in borrowing	40
Repayment of borrowing	-42

For the year 2018, the reconciliation between the consolidated financial debts and the flows from the cash flow statement was as follows :

Total	191	1	192
Short term financial debt	31	11	42
Long term financial debt	160	-10	150
EUR million	At 1 January 2018	Cash flow variation	At 31 December 2018

The cash flow variation mentioned in the table here below reconciled with the consolidated statement of cash flows as follows:

EUR million	At 31 December 2018
Cash flow variation	1
Of which : Increase in borrowing	92
Repayment of borrowing	-91

(12) Relationships with directors of the consolidating company

Compensation and pensions: from early 2014, the directors have been paid a gross appearance fee of € 2,000 per meeting for each Director and a gross fee of € 4,000 per meeting for the Chairman of the Board.

Advances and loans provided by the consolidating company or by an affiliated company: the current account with Solvay S.A. (zero balance in 2019 and 2018) is compensated at the Solvay Group's internal financing rate.

(13) Off-balance sheet rights and commitments

Real coverage by the company on its own assets: collateralisation of 3,111,654 Solvay shares in favour of

• BNP Paribas Fortis 2.,469,813 shares for a sum of € 255 million (valued at the share rate at December 1st, 2019)
• KBC 641,841 shares for a sum of € 66 million (valued at the share rate at December 1st, 2019)

The number of shares pledged represents 9.6% of the total number of Solvay shares held by Solvac.

(14) List of consolidated companies

The Solvay Group is consolidated using the equity method.

EUR million	2018	2019
Cash revenue	117.1	121.9
Operating result	-1.4	-1.5
Cost of borrowings	-3.9	-3.6
Other financial charges and income	0.0	0.0
Cash revenue	111.8	116.8
Minus Solvay dividend received in January 2018 and January 2019, recorded in the net income of year 2017 and 2018, respectively	-44.9	-46.8
Plus Solvay dividend received in January 2019 and January 2020, recorded in the net income of year 2018 and 2019, respectively	46.8	48.8
Taxes	0.0	0.0
Cancellation of Solvay dividends, reversed in consolidation	-119.0	-123.9
Share of Solvay net result during the year	276.5	37.2
Net income Solvac - Consolidated financial statement	271.2	32.1

(15) Reconciliation between cash revenue and consolidated net income for the years 2018 and 2019