2019 Annual financial report

Financial instruments

In principle, the derivatives established by the Company are subscribed for hedging purposes only. The accounting treatment of these instruments is:

• derivatives purchased to hedge foreign currency receivables, debts, loans or borrowings are revalued in the balance sheet as part of their foreign exchange component in order to embody the symmetry effect at the level of the “Unrealized foreign exchange – Gains/Losses” on the balance sheet;
• realized gains and losses are recorded symmetrically on the hedged ite

Financial income (expense)

Financial income is recognized by applying the usual rules, namely:

• dividends: on the date the distribution is approved by the General Shareholders’ Meeting;
• financial income on current accounts, time deposits and bonds: as, and when, income is acquired;
• interest and dividends on marketable securities: on the date of receipt.

Financial expenses relating to the Eurobond 2021 and 2024 are presented, where applicable, inclusive of the interest income (expense) arising from the interest rate swaps.

It should, moreover, be noted that the swaps connected with the two aforementioned bonds are treated as hedges of loans in dollars recognized as assets.

Exceptional items

These include capital gains and losses on the sale of property, plant and equipment, and intangible and financial assets.

Note 3 Revenue

Billings are mainly composed of:

• rent received from the building at 133 avenue des Champs-Élysées in Paris, France;
• services invoiced to Group companies.

Note 4 Reversal of provisions and expense transfers

Expense transfers primarily include the re-invoicing of Group companies with respect to the awarding of Publicis Groupe free share grants to certain Group executives

Note 5 Personnel expenses

2019 personnel expenses include the compensation of the Chair of the Management Board and related expenses. They also include the costs related to 2019 free share plans amounting to euro 25,934,131, the delivery of which in existing shares does result in a charge to the income statement. In 2018, the costs associated with these plans amounted to euro 25,290,031.