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The deferred taxes of French companies were revalued to take into
account the article of the Finance Act for 2017 for the progressive
reduction of corporate income tax.
The deferred taxes of US companies were revalued according to the
best estimate to take into account the lowering of the federal tax
rate pursuant to the tax reform adopted in 2017 in the United States.
2.2.18.6 Earnings per share
Net earnings per share (before dilution) are calculated on the ratio
between the net profit for the period and the weighted number of shares
in circulation during the period, after deduction of shares held by the
Group (treasury shares). Net diluted earnings per share are calculated
by including financial instruments that provide deferred access to the
Group’s capital (stock options, share warrants, performance shares).
2.2.19
I
Segment information
The LISI Group presents its segment information in accordance with
the criteria defined by IFRS 8.
An operating segment is a component of an entity:
–
–
that engages in business activities from which it may earn
revenues and incur expenses (including revenues and expenses
relating to transactions with other components of the same
entity);
–
–
whose operating results are regularly reviewed by the chief
operating decision maker to make decisions about resources to be
allocated to the segment and assess its performance; and
–
–
for which discrete financial information is available.
The Group’s activities are spread over three business segments, in
which the three divisions operate:
–
–
LISI AEROSPACE, which combines all the activities in the aerospace
market;
–
–
the LISI AUTOMOTIVE division, which covers all activities in the
automotive market;
–
–
LISI MEDICAL, which covers all activities in the medical market.
Other activities mainly include the activities of the Group’s main
company.
2.2.20
I
Indicators
The Group uses the indicators defined below.
Free cash flow:
Operating cash flow minus net industrial CAPEX and
changes in working capital requirements (see chapter 3 note 2.5.2.3
Cash and cash equivalents).
Return on capital employed (ROCE):
Ratio of EBIT to average capital
employed (Shareholders’ equity + Net debt for years N and N-1).
Return on equity (ROE):
Ratio of net earnings to total shareholders’
equity.
Gearing:
Ratio of Net Debt to the Group share of consolidated equity.
Book to bill:
Ratio between the orders taken during the period and the
billing during the same period.
Revalued Net Assets (RNA):
Average of [(0.95 x Group Sales Revenue)
+ (6.5 x Group EBITDA) + (10 x Group EBIT)] - Average Group Net Debt for
years N and N-1. The indices selected are defined by the management
and are identical to 2016.
2.3
I
SCOPE OF CONSOLIDATION
2.3.1
I
Changes in the consolidation scope in the financial
year 2017
■■
Acquisition of 51% of Termax Group shares on October 31, 2017 with
an option to purchase the remaining 49% in 2021.
■■
Sale of Précimétal Fonderie de Précision on February 2, 2017.
2.3.2
I
Impact on the Group indicators of the consolidation
of Termax Group, which took place during financial
year 2017
In € million
Impact in %
on the Group
indicators
Sales revenue from November
to December 2017
10.9
0.7%
EBIT November to December
2017
1.6
0.9%
Changes in scope are included in the thresholds recommended by
the supervision authorities. We have not established any proforma
statements.
2.3.3
I
Impact on the Group indicators of the deconsolidation
of Précimétal Fonderie de Précision which took place
during financial year 2017
In € million
Impact in %
on the Group
indicators
Sales revenue January 2017
1.5
0.1%
EBIT January 2017
0.1
NS
42
LISI 2017 FINANCIAL REPORT
CONSOLIDATED FINANCIAL STATEMENTS
3