SOCO1

Guyancourt

Konzernabschluss zum Geschäftsjahr vom 01.01.2022 bis zum 31.12.2022

SOCO 1

Simplified joint-stock company with a share capital of EUR 518,497,096

Registered office: 5 place des Freres Montgolfier - 78280 Guyancourt

Versailles Commerce and Companies Registry No. 789 991 221

(the "Company")

Management report on the consolidated financial statements for the financial year ended 31 December 2022 to be submitted to the Ordinary General Meeting of 29 June 2023

Dear Shareholders,

Please find below the information that we submit in relation to the last financial year pursuant to the Company's articles of association and Article L. 227-9 of the French Commercial Code, in order:

―	to report on the Group's activity over the course of the financial year ended 31 December 2022 and on its performance and outlook; and
―	to submit where applicable for your approval the balance sheet and annual financial statements for the said financial year.

Your joint statutory auditors shall disclose in their report any and all information related to the fairness of the consolidated financial statements submitted to you.

We are available to provide you with any clarifications and additional items of information that you may deem requisite.

We submit in this report all of the information provided for in applicable laws and regulations in accordance with applicable provisions.

CONTENTS

I. ACTIVITY OF THE GROUP DURING THE FINANCIAL YEAR

A. Socotec accelerates its development in 2022

B. Events occurring after the end of the 2022 financial year

C. Likely developments and outlook

D. Group R&D activities

E. SOCOTEC Group's scope of consolidation

II. CONSOLIDATED FINANCIAL STATEMENTS

III. OTHERS / MISCELLANEOUS

A. Exemption to disclose the annual financial statements

B. Statement regarding to acquisition of shares

C. Financial risk management objectives and policies

I. ACTIVITY OF THE GROUP DURING THE FINANCIAL YEAR

A. Socotec accelerates its development in 2022

The Group continued its dynamic external growth policy, with a total of 13 acquisitions. These have made it possible to strengthen the existing business lines in countries in which the Group operates (France, United States, United Kingdom, Italy, Germany, Netherlands), and diversified its geographical presence in Europe with its launch on the Spanish market.

In France:

―	On 30 March 2022: creation of SOCOTEC CSPS Consulting with a view to acquiring the CSPS Consulting business on 29 April 2022.
―	On 2 August 2022: acquisition of ASCAUDIT Holding and its subsidiaries: ASCAUDIT Groupe, ASCAUDIT SAS, ASCAUDIT Energie et Fluides, ASCAUDIT Mobilité et Gestion Technique Informatique Immobilière "GT2I", a Group that promotes the development of the built portfolio.
―	On 13 November 2022: creation of SOCOTEC Newco 1 for future business acquisitions.

In Spain:

―	On 4 February 2022: acquisition of BAG Engineering Consultancy group, a well-established player in structural engineering, inspection, testing and risk management, notably for transport infrastructure, marine construction works and waterworks, as well as the construction industry.

With regard to its subsidiaries in Germany:

Acquisition of Pfeifer, which specialises in consulting for the construction industry, namely in relation to structural issues and building physics, fire protection and major works of all kinds, through its subsidiary ZPP Ingenieure. Pfeifer has changed its corporate name to "ZPC GmbH".

With regard to its subsidiaries in the US:

SOCOTEC USA acquires Trinity I ERDTrinity | ERD, an architecture and engineering company specialising in consultation on existing buildings, forensic investigation and litigation analysis. Its teams exercise their extensive expertise in the existing buildings market across the country, from their offices in Washington, Hawaii and Louisiana.

In December 2022, the company Russo Bar Associates was acquired.

With regard to its subsidiaries in the UK:

―

On 10 May 2022, SOCOTEC UK Ltd., a subsidiary of the Company, acquired a 70% stake in Base Quantum Ltd, which became SOCOTEC Advisory on 17 October 2022.

―

During the 2nd half of 2022, SOCOTEC Building & Real Estate Holdings Ltd., a subsidiary of the Company, acquired:

•	100% of Shore Engineering Ltd.
•	100% of Vernier Holding Ltd and its subsidiaries QAI Services Ltd, Quadrant Building Compliance Ltd & Quadrant Building Control Ltd.

With regard to its subsidiaries in Italy:

SOCOTEC Italia SRL, a subsidiary of the Company, acquired:

―	On 22 March 2022: Eurogeo SRL, a specialist in geotechnical investigations for infrastructure projects.
―	On 20 July 2022: IMG SRL and its subsidiary, IMG Monitoring Sp z.o.o. in Poland, a company specialising in complex monitoring systems in the geotechnical and structural industries.
―	In 2022: Sestosensor SRL, a high-tech company specialising in innovative products and solutions for surveillance and monitoring by fibre optic sensors.

With regard to its subsidiaries in the Netherlands:

On 4 August 2022: SOCOTEC Netherlands BV, a subsidiary of the Company, acquired CAG Groep, a company operating for over 25 years in the testing and inspection markets in the management of drinking water quality, as well as the optimisation and energy performance of buildings.

In this context, the SOCOTEC Group generated consolidated revenue of EUR 1,156.6 million in 2022, an increase of 15.9%.

Continuation of a global factoring programme

During the 2021 financial year, the SOCOTEC Group set up a non-recourse global factoring agreement for its subsidiaries in Europe, enabling the financing of trade receivables (currently under discussion for the United States).

Refinancing

In view of these transactions, at 31 December 2022, the Group had drawn EUR 70 million on its revolving credit facility.

No refinancing of senior debt took place during the 2022 financial year.

In December 2022, Holding SOCOTEC set up a new revolving credit facility in the amount of EUR 106 million, which is part of the existing senior documentation ("Senior Facility Agreement" of June 2021) and carries a total of EUR 226 million in revolving credit lines.

Ethics, the Mainstay of our Role as a Trusted Third Party

SOCOTEC acts in order to manage and control the risks related to construction, infrastructures and the industrial sector at the request of public and private players seeking to obtain a precise, independent and transparent assessment.

At SOCOTEC, being ethical means demonstrating integrity, responsibility and transparency towards all our stakeholders: business ethics, ethical recruitment and ethical work behaviour with our internal and external partners are matters covered by continuous vocational training and constant managerial attention.

All of our employees are trained in the SAPIN II Law and in the best anti-corruption and anti-fraud practices for sound commercial relationships. Commercial rules are strict and precise, and our Company highlights the sense of responsibility of all employees and the discipline to be observed in business matters.

We also require that all managers sign a guide of best managerial practices that is circulated each year in all countries in which we are trading, i.e. the Manager Authorisation Guide. This guide sets out the practices in force at SOCOTEC and the rules related to decision-making based on fair behaviour, incorporating the Company's fair and ethical rules.

Finally, any form of discrimination within the Company and upon recruitment is contrary to our principles, and we seek to diversify our hiring, while respecting diversity and appraising careers, taking into account our professional specialties. We strive to increase gender equality in our recruitment and on the construction and public works market, where co-education tends to increase markedly in schools and in the academic community.

SOCOTEC's commitment to ethics and transparency is also enshrined in its Code of Ethics, which is binding on all of its employees in France and elsewhere in the world. Compliance with laws and regulations is central to our requirements and our values, and does not allow for any ethical compromise. A whistleblowing mechanism enables all Group employees and any individual to report any crime, offence, inappropriate behaviour or threat to general welfare.

An Ethics Committee is responsible for implementing the Code of Ethics, for receiving reports related to unethical conduct and for monitoring the implementation of the anti-corruption laws.

Lastly, SOCOTEC relies on a Chief Compliance Officer who coordinates a network of Compliance Officers present on our geographical platforms.

B. Events occurring after the end of the 2022 financial year

Since the beginning of 2023, the SOCOTEC Group directly or indirectly made the following acquisitions:

In France:

―	On 3 April 2023: Holding SOCOTEC sold 75,004 shares held in the share capital of SOCOTEC Monitoring Holding to this company.
―	On 3 April 2023: Gestion Technique Informatique Immobilière "GT2I", a subsidiary of ASCAUDIT Groupe, was dissolved without liquidation, resulting in the transfer of all assets to its sole partner, ASCAUDIT Groupe.
―	On 6 April 2023: 100% acquisition of ALPHA FORMATION in France.

In Germany:

―	Architectural firm Höhlich & Schmotz was acquired in February 2023 by Canzler.
―	ZPP Ingenieure acquired Marx Ingenieure in February 2023 and Erdmann Brandmann in March 2023.
―	ZPP Ingenieure acquired Stredich in May 2023

In the USA:

Spinnaker was acquired by SOCOTEC US in April 2023.

C. Likely developments and outlook

For 2023, the SOCOTEC Group is planning to continue its organic growth, whilst maintaining its business line and geographical expansion through a policy of targeted acquisitions.

None of the Group's subsidiaries operate in the geographical areas affected by the conflict between Russia and Ukraine that began in February 2022. However, the geopolitical uncertainties triggered by this conflict have led to an increase in certain operating costs (e.g. inflationary pressures, especially with regard to energy supplies) and a slowdown in construction work due to increased procurement lead times.

D. Group R&D activities

Pursuant to Article 232-1 of the French Commercial Code, we hereby inform you that the Group's holding company did not engage in any research and development activity during the last financial year.

E. SOCOTEC Group's scope of consolidation

Pursuant to Article L. 233-26 of the French Commercial Code, the company has prepared consolidated financial statements to 31 December 2022 that include the following companies:

			2022	2021
Companies	Head office	Method of consolidation	% interest	% interest
4see Consulting (UAE)	United Arab Emirates	FC	49.0	49.0
4SEE	United Kingdom	FC	98.5	98.7
Socotec Inter Abu Dhabi Branch	United Arab Emirates	FC	49.0	100.0
Socotec Africa	Còte d'Ivoire	FC	100.0	100.0
Socotec AirBTP	France	FC	100.0	100.0
AJA UK	United Kingdom	FC	100.0	100.0
Socotec Certification Hong Kong	China	FC	100.0	100.0
Socotec Certification Philippines	Philippines	FC	40.0	40.0
Socotec Certification Thailand	Thailand	FC	74.4	74.4
Socotec Certification USA	United States	FC	100.0	100.0
Socotec Certification Training	Thailand	FC	49.0	49.0
Socotec Asbestos Limited	United Kingdom	FC	98.5	98.7
Socotec Antilles-Guyane	France	FC	100.0	100.0
ArchEng Holding Company	United States	FC	94.7	91.4
Socotec ASBL	Luxembourg	FC	100.0	100.0
Ascaudit SAS	France	FC	100.0
Ascuadit Energie et Fluides SAS	France	FC	100.0
Ascaudit Groupe SAS	France	FC	100.0
Ascaudit Holding SAS	France	FC	100.0
Ascaudit Mobilité SAS	France	FC	100.0
Schollenberger Kampfmittelbergung GmbH Austria	Austria	FC	77.3	77.3
AXE Maroc	Morocco	FC	99.9	99.9
AXE France	France	FC	100.0	100.0
Bac Engineering Consultancy Group, S.L.	Spain	FC	91.8
Bac Group S.A S. (Colombia)	Colombia	FC	91.8
Socotec Gulf	Bahrain	FC	100.0	100.0
SCI Bouloi Bas	France	FC	100.0	100.0
Buckingham Investigation	United Kingdom	FC	98.5	98.7
BAC Engineering Consultancy Group Sucursal Colombia	Colombia	FC	91.8
Bac Engineering Consultancy Group S.A.S. (Colombia)	Colombia	FC	91.8
Energia v Recursos Hidilibicos Consultoria Technica S.L.	Spain	FC	63.3
Socotec Belgium SPRL	Belgium	FC	100.0	100,0
SCI Bouloi Haut	France	FC	100.0	100.0
Iciasa Control e Inspection S.L.	Spain	FC	91.8
BIM In Motion	France	FC	100.0	100.0
Base Midlands Limited	United Kingdom	FC	69.0
Base Quantum Ireland Limited	Ireland	FC	69.0
Socotec Advisory Limited	United Kingdom	FC	69.0
Bac I Ventavol Geoserveis S.L	Spain	FC	91.8
Vea Qualitas S.L.	Spain	FC	91.8
Socotec Building Control	United Kingdom	FC	98.5	98.7
Butler & Young Consultants Limited	United Kingdom	FC	98.5	98.7
Butler & Young Group Limited	United Kingdom	FC	98.5	98.7
Butler & Young Holdings Limited	United Kingdom	FC	98.5	98.7
Trenton Fire Limited	United Kingdom	FC	98.5	98.7
ESG Capital 1 Limited	United Kingdom	FC	98.5	100.0
C2G International LLC	United States	FC	94.7	91.4
ESG Capital 2 Limited	United Kingdom	FC	98.5	98.7
Socotec Calédonie	New Caledonia	FC	100.0	100.0
Société de Développement BTP Maroc	Morocco	FC	100.0	100.0
CBI Consulting LLC	United States	FC	94.7	91.4
CIS Certification PTE	Singapore	FC	95.0	95.0
Socotec Civil Engineering	France	FC	100.0	100.0
Contrôle Industriel Belge SA	Belgium	FC	100.0	100.0
Socotec Belgium ASBL	Belgium	FC	100.0	100.0
Canzler GmbH	Germany	FC	69.2	69.2
Certification International Holdings INC	Philippines	EM	39.9	39.9
Socotec Certification Japan	Japan	FC	50.1	50.1
Certification International Limited	United Kingdom	FC	100.0	100.0
Certification International Philippines INC	Philippines	EM	63.8	63.8
Socotec Certification Singapore	Singapore	FC	95.0	95.0
Cementys France	France	FC	99.5	66.5
Geotys	France	FC	99.5	66.5
SensOptix	France	FC	99.5	66.5
Cementys Vietnam	Vietnam	FC	99.5	66.5
CPAG	United States	FC	94.7	91.4
Socotec CSPS Consulting	France	FC	100.0
Socotec Certification UK	United Kingdom	FC	100.0	100.0
Socotec Développement	France	FC	100.0	100.0
GeoFact GmbH	Germany	FC	77.3	77.3
Socotec Deutschland Holding	Germany	FC	98.8	98.8
David Pattino & Associates	United States	FC	94.7	91.4
Schollenberger Kampfmittelbergung GmbH	Germany	FC	77.3	77.3
Socotec Testing GmbH	Germany	FC	77.3	77.3
Socotec Inter Dubai Branch	United Arab Emirates	FC	100.0	100.0
Socotec Expertise	France	FC	100.0	100.0
Socotec Diagnostic Groupe	France	FC	100.0	100.0
Socotec Diagnostic	France	FC	100.0	100.0
ESG Investments Limited	United Kingdom	FC	98.5	98.7
Geotech Specialists Limited Ireland	Ireland	FC	98.5	98.7
Real Estate Technical Management "GT2I" SAS	France	FC	100.0
Holding Socotec	France	FC	100.0	100.0
Holding Socotec (South East Asia) PTE Ltd	Singapore	FC	100.0
HuberLischka Architekten GmbH	Germany	FC	69.2	69.2
Henley Water Limited	United Kingdom	FC	98.5	98.7
IBA Holdings LLC	United States	FC	94.7	91.4
Inspicio Environmental	United Kinadom	FC	98.5	98.7
Inspicio Holdings Ltd	United Kingdom	FC	98.5	98.7
IMG	Italy	FC	85.0
IMG Monitoring Poland	Poland	FC	85.0
Socotec Infrastructure	France	FC	100.0	100,0
Socotec International	France	FC	100.0	100.0
Sestosensor	Italy	FC	85.0
ITAL SOCOTEC	Italy	EM	40.0	40.0
Socotec Italia SRL	Italy	FC	85.0	85.0
Constructionfit Monitoring Limited	United Kingdom	FC	98.5	98.7
Eurogeo	Italy	FC	85.0
Socotec Italia Holding	Italy	FC	85.0	85.0
Calyx Investments Limited	United Kingdom	FC	98.5	98.7
Socotec Monitoring UK Limited	United Kingdom	FC	98.5	98.7
Tecnolab	Italy	FC	85.0	85.0
Socotec Power Services	France	FC	100.0	100.0
Socotec Liban	Lebanon	FC	90.0	90.0
Socotec Liban Saudi Arabia branch	Saudi Arabia	FC	90.0
LPI Engineering Inc	United States	FC	94.7	91,4
LPI Inc	United States	FC	94.7	91.4
Socotec Luxembourg SARL	Luxembourg	FC	100.0	100.0
Socotec Madagascar	Madagascar	FC	100.0	100.0
Socotec Infrastructure Maroc	Morocco	FC	100.0	100.0
Socotec Maroc	Morocco	FC	99.9	99.9
Socotec Monaco	Monaco	FC	97.0	96.0
Socotec MTS Ltd. (Mauritius)	Mauritius	FC	100.0	100.0
New Blue BV	Netherlands	FC	100.0
Blue Star BV	Netherlands	FC	100.0
CAG Amned BV	Netherlands	FC	100.0
Buis- IT BV	Netherlands	FC	100.0
CAG GmbH	Germany	FC	100.0
CAG Amned Group BV	Netherlands	FC	100.0
Het Inspectiehuis - Het Energiehuis BV	Netherlands	FC	100.0
Invent Advies BV	Netherlands	FC	100.0
IQ- Laboratory BV	Netherlands	FC	100.0
CAG Services BV	Netherlands	FC	100.0
Tandrup Water Solutions Nederland BV	Netherlands	FC	75.0
Woning Advies Nederland BV	Netherlands	FC	100.0
CIS Controle Supervision Inspection	France	FC	100.0	100.0
Hanselman Expertise BV	Netherlands	FC	100.0	100.0
Hanselman Holding BV	Netherlands	FC	100.0	100.0
Hanselman Groep BV	Netherlands	FC	100.0	100.0
E&F Leasing BV	Netherlands	FC	100.0	100.0
ProScan BV	Netherlands	FC	100.0	100.0
Salvage Transport Incidents BV	Netherlands	FC	100.0	100.0
IB Engineers BV	Netherlands	FC	70.0
Sonar Geothechniek BV	Netherlands	FC	70.0
Inpijn Blokpoel Milieu BV	Netherlands	FC	70.0
Songoed BV	Netherlands	FC	70.0
Inpijn Blokpoel West BV	Netherlands	FC	70.0
Inpiin Blokpoel Zuid BV	Netherlands	FC	70.0
Socotec Netherlands BV	Netherlands	FC	100.0	100.0
Socotec Testing Netherlands BV	Netherlands	FC	100.0
Phoenix UK 2020	United Kingdom	FC	98.5	98.7
Patrick Levy Consulting	France	FC	100.0	100.0
Socotec Polynésie	French Polynesia	FC	100.0	100.0
PSP Tunnelling Engineers	Germany	FC	92.0	92.0
URBADS	France	FC	100.0
URBYCOM	France	FC	100.0
RINCENT BTP SERVICE SAS	France	EM	40.0	40.0
Socotec Réunion	France	FC	100.0	100.0
S2M	France	FC	100.0	100.0
Socotec Smart Solutions	France	FC	100.0	100.0
Sococonsult	Morocco	FC	99.9	99.9
Synergen Consulting International LLC	United States	FC	94.7	91.4
Socotec Control Spain S.L.U.	Spain	FC	100.0
Socotec Construction	France	FC	100.0	100.0
SD Ingenieure	Germany	FC	64.9	64.9
Socotec Equipements	France	FC	100.0	100.0
Socotec Environnement	France	FC	100.0	100.0
Socotec Formation	France	FC	100.0	100.0
Socotec Gestion	France	FC	100.0	100.0
Environmental Scientifics Group Holdings Limited	United Kingdom	FC	98.5	98.7
Socotec UK Limited	United Kingdom	FC	98.5	98.7
Environmental Scientifics Holdings Limited	United Kingdom	FC	98.5	98.7
Socotec Immobilier Durable	France	FC	100.0	100.0
Scientifics Limited	United Kingdom	FC	98.5	98.7
Socotec Monitoring France	France	FC	99.5	66.5
SNER Société Novatrice d'Etudes et Réalisations	France	FC	100.0	100.0
SOCO1	France	Holding company	100.0	100.0
Socotec Formation Nucléaire	France	FC	100.0	100.0
Socotec Certification	France	FC	100.0	100.0
Socotec Technical Consulting	France	FC	100.0	100.0
Socotec UK Holding	United Kingdom	FC	98.5	98.7
TOR Drilling	United Kingdom	FC	98.5	98.7
Socotec US Holding Inc	United States	FC	94.7	91.4
Socotec US Holding LP	United States	FC	94.7	91.4
Socotec Consulting Inc.	United States	FC	94.7	91.4
Veritas Advisory Group	United States	FC	94.7	91.4
Vidaris Holdings LLC	United States	FC	94.7	91.4
Vidaris Inc	United States	FC	94.7	91.4
VIH Company	United States	FC	94.7	91.4
Waterwise Technoloy Limited	United Kingdom	FC	98.5	98.7
ZPC GmbH	Germany	FC	87.4	87.4
ZPP International GmbH	Germany	FC	92.0	92.0
LauPlan GmbH	Germany	FC	92.0	92.0
ZPP Ingenieure AG	Germany	FC	92.0	92.0
Zickler & Jakob	Germany	FC	69.2	69.2

II. CONSOLIDATED FINANCIAL STATEMENTS

The Group's consolidated financial statements have been prepared in accordance with International Accounting Standards ("IFRS") as adopted by the European Union at 31 December 2022, pursuant to Regulation (EC) No. 1606/2022 of the European Parliament on the application of international standards. In addition, these financial statements have been prepared in accordance with the IFRS standards issued by the International Accounting Standards Board (IASB).

The standards adopted by the European Union are available on the European Commission's website.

The Group companies over which the Company exercises a direct or indirect control are fully consolidated. Companies over which the Group exercises material influence are accounted for through the equity method.

The Group's consolidated revenue amounted to EUR 1,156.6 million.

Operating income totalled EUR 100.3 million.

Net financial income amounted to EUR (58.968) million and the tax expense was EUR (19.5) million.

In view of the above, consolidated net income stood at EUR 22.2 million and the Group's consolidated net income was EUR 14.4 million.

The consolidated statement of comprehensive income shows comprehensive income of EUR 61.2 million, made up of EUR 22.2 million in consolidated net income as well as items not reclassified to profit and loss for EUR 5.5 million and items reclassified to profit and loss for EUR 33.6 million.

In accordance with Article L. 233.16 of the French Commercial Code, we recommend that you approve the consolidated financial statements submitted to you as an appendix hereto.

The Statutory Auditors submit in their report their assessments pertaining to the consolidated financial statements.

The draft resolutions that shall be submitted to you include the various proposals contained in this report.

III. OTHERS / MISCELLANEOUS

A. Exemption to disclose the annual financial statements

In accordance with the Comfort Letters signed, and the German Law and especially Art 264 section 3 HGB and Art 264b HGB, SOCO1, as the parent company of the Group, acknowledges that the following companies:

―	ZPP Ingenieure AG,
―	Schollenberger Kampfmittelbergung GmbH (Germany),
―	Canzler GmbH
―	Socotec Testing GmbH, and
―	Socotec Deutschland Holding GmbH

Are included into the consolidated financial statements, and therefore are exempted from the requirement to disclose their annual financial statements.

B. Statement regarding to acquisition of shares

Since SOCO 1 S.A.S. has not acquired own shares in the financial year 2022, no statements according to Sec. 24 para. 2 of EU-Directive 2012/30/EU dated 25 October 2012 need to be made.

C. Financial risk management objectives and policies

The Group's interest rate risk arises primarily from assets and liabilities bearing interest at floating rates. The Group seeks to limit its exposure to a rise in interest rates and may use interest rate instruments where appropriate. The Group may therefore enter into other swaps, caps, collars or similar instruments for this purpose. No financial instruments are contracted for speculative purposes. At December 31, 2022, the Group had put in place interest rate hedges.

The Chairman

Hervé MONTJOTIN

2022 ANNUAL REPORT

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

CONSOLIDATED STATEMENT OF CASH FLOWS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - PRESENTATION OF THE BUSINESS AND MAJOR EVENTS

NOTE 2 - ACCOUNTING POLICIES AND METHODS

NOTE 3 - REVENUE

NOTE 4 - OPERATING INCOME

NOTE 5 - OTHER FINANCIAL INCOME AND EXPENSES

NOTE 6 - INCOME TAX

NOTE 7 - GOODWILL

NOTE 8 - ACQUISITIONS AND DISPOSALS

NOTE 9 - INTANGIBLE ASSETS

NOTE 10 - PROPERTY, PLANT AND EQUIPMENT

NOTE 11 - LEASES

NOTE 12 - DEFERRED TAX

NOTE 13 - CURRENT AND NON-CURRENT FINANCIAL ASSETS

NOTE 14 - OTHER CURRENT AND NON-CURRENT ASSETS

NOTE 15-INVENTORIES

NOTE 16 - TRADE AND OTHER RECEIVABLES

NOTE 17 - CONTRACT ASSETS AND LIABILITIES

NOTE 18 - CASH AND CASH EQUIVALENTS

NOTE 19 - CALLED-UP SHARE CAPITAL

NOTE 20 - SHARE-BASED PAYMENTS

NOTE 21 - DIVIDEND PER SHARE

NOTE 22 - DEBT

NOTE 23 - CURRENT AND NON-CURRENT FINANCIAL LIABILITIES

NOTE 24 - LONG-TERM EMPLOYEE BENEFITS

NOTE 25 - CONTINGENCY AND LOSS PROVISIONS

NOTE 26 - OTHER CURRENT LIABILITIES

NOTE 27 - TRADE AND OTHER PAYABLES

NOTE 28 - SEGMENT REPORTING

NOTE 29 - INFORMATION ON FINANCIAL INSTRUMENTS

NOTE 30 - FINANCIAL RISK MANAGEMENT

NOTE 31 - HEADCOUNT

NOTE 32 - OFF-BALANCE SHEET COMMITMENTS AND PLEDGES

NOTE 33 - RELATED PARTY TRANSACTIONS

NOTE 34 - EXECUTIVE REMUNERATION

NOTE 35 - STATUTORY AUDITORS' FEES

NOTE 36 - POST-BALANCE SHEET EVENTS

NOTE 37 - SCOPE OF CONSOLIDATION

NOTE 38 - SOCOTEC GROUP'S TRANSITION TO IFRS AT 1 JANUARY 2021 AND 31 DECEMBER 2021

2022 ANNUAL REPORT

CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2022

CONSOLIDATED INCOME STATEMENT

(€ thousands)	Notes	Year to 31 December 2022	Year to 31 December 2021
Revenue	3	1,156,599	997,727
Staff costs	4	-613,048	-521,432
Purchases and external charges	4	-326,854	-268,185
Taxes other than on income	4	-9,866	-9,701
Depreciation, amortisation and provisions	8/9/10	-90,104	-107,310
Other operational income and expense	4	-16,423	-15,238
Operating income		100,304	75,861
Income from cash and cash equivalents		227	164
Gross cost of debt		-39,282	-38,993
Interest on lease liabilities		-4,701	-3,901
Net cost of debt		-43,756	-42,730
Other net financial income and expenses	5	-15,212	-4,726
Net financial income (expense)		-58,968	-47,455
Profit (loss) before tax		41,336	28,406
Income tax expense	6	-19,504	-14,747
Share in profit (loss) of companies accounted for under the equity method		345	467
Net profit		22,177	14,126
Non-controlling interests		7,779	-486
NET PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY		14,399	14,612

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(€ thousands)	Notes	Year to 31 December 2022	Year to 31 December 2021
Net profit		22,177	14,126
Other comprehensive income
Items that may not be reclassified to profit or loss
Actuarial gains/(losses) net of tax		5,491	5,898
Tax effect on items that may not be reclassified to profit or loss
Total items that may not be reclassified to profit or loss		5,491	5,898
Items that may be reclassified to profit or loss
Translation differences		15,325	19,177
Cash flow hedges net of tax		18,256	660
Items that may be reclassified to profit or loss		33,581	19,837
Total other comprehensive income (after tax)		39,072	25,735
COMPREHENSIVE INCOME		61,249	39,860
attributable to:
owners of the Company		52,827	38,776
to non-controlling interests		8,423	1,085

STATEMENT OF FINANCIAL POSITION

(€ thousands)	Notes	At 31 December 2022	At 31 December 2021
Goodwill	7	855,232	726,899
Intangible assets	9	238,977	243,311
Property, plant and equipment	10	86,545	77,712
Right-of-use assets	11	107,287	92,985
Non-current financial assets	13	66,769	20,575
Deferred tax assets	12	33,945	36,845
Total non-current assets		1,388,754	1,198,326
Inventories	15	5,361	3,118
Trade receivables	16	163,963	138,330
Contract assets	17	88,595	69,365
Income tax receivables		32,297	25,548
Other current financial assets	13	2,595	971
Other current assets	14	110,853	75,468
Cash and cash equivalents	18	107,829	158,092
Total current assets		511,493	470,892
TOTAL ASSETS		1,900,247	1,669,217
Share capital	19	629,479	664,993
Reserves and net profit		-496,586	-538,864
Equity attributable to owners of the Company		132,894	126,128
Non-controlling interests		44,767	51,893
Total equity		177,660	178,021
Non-current financial liabilities	22	934,689	903,398
Non-current lease liabilities	11	79,420	66,086
Deferred tax liabilities	12	48,737	43,546
Non-current employee benefits	24	18,323	21,780
Non-current provisions	25	43,556	43,816
Total non-current liabilities		1,124,725	1,078,626
Trade and other payables	27	348,741	286,924
Contract liabilities	17	20,401	10,986
Current income tax liabilities		33,055	24,072
Current financial liabilities	22	107,064	26,432
Current lease liabilities	11	34,930	30,838
Other current financial liabilities	23	1,719	1,654
Other current liabilities	26	51,951	31,665
Total current liabilities		597,862	412,571
TOTAL EQUITY AND LIABILITIES		1,900,247	1,669,218

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(€ thousands)	Share capital	Share premiums	Translation reserves
At 1 January 2021	508,832	186,020	-1,366
Share-based payment
Put/Earn out
Dividends paid
Transactions in own shares		-29,859
Change in scope	6,188	-6,188
Total transactions with owners	6,188	-36,047	0
Net profit
Other comprehensive income			17,606
Comprehensive income	0	0	17,606
At 31 December 2021	515,020	149,973	16,240
Share-based payment
Put/Earn out
Dividends paid
Transactions in own shares	3,477	-38,990
Change in scope
Total transactions with owners	3,477	-38,990	0
Net profit
Other comprehensive income			14,681
Comprehensive income	0	0	14,681
AT 31 DECEMBER 2022	518,497	110,983	30,921

(€ thousands)	Other reserves	Attributable to owners of the Company	Attributable to non-controlling interests	Total equity
At 1 January 2021	-566,950	126,536	53,355	179,891
Share-based payment	3,361	3,361		3,361
Put/Earn out	476	476		476
Dividends paid	-39,553	-39,553	-2,220	-41,773
Transactions in own shares	29,859	0		0
Change in scope	-3,468	-3,468	-327	-3,795
Total transactions with owners	-9,325	-39,184	-2,547	-41,731
Net profit	14,612	14,612	-486	14,126
Other comprehensive income	6,558	24,164	1,571	25,735
Comprehensive income	21,170	38,776	1,085	39,861
At 31 December 2021	-555,105	126,128	51,893	178,021
Share-based payment	2,170	2,170		2,170
Put/Earn out	-11,466	-11,466		-11,466
Dividends paid	-39,563	-39,563	-1,540	-41,103
Transactions in own shares	35,513	0		0
Change in scope	2,798	2,798	-14,009	-11,211
Total transactions with owners	-10,548	-46,061	-15,549	-61,610
Net profit	14,399	14,399	7,779	22,177
Other comprehensive income	23,747	38,428	644	39,072
Comprehensive income	38,146	52,827	8,423	61,249
AT 31 DECEMBER 2022	-527,507	132,894	44,766	177,660

CONSOLIDATED STATEMENT OF CASH FLOWS

(€ thousands)	Notes	Year to 31 December 2022	Year to 31 December 2021
Consolidated net profit		22,177	14,126
Profit (loss) of companies accounted for under the equity method		-345	-467
Depreciation, amortisation and provisions, net	9/8/10	86,885	102,184
Change in deferred tax	6/12	-4,254	-9,807
Unrealised foreign exchange gains and losses		11,638	-729
Other income and expense (gains or losses on asset disposals)		15,093	17,037
Cash from operating activities before changes in the WCR		131,194	122,343
Changes in net inventories		-15,861	-11,723
Changes in receivables		-72,473	60,651
Change in other financial liabilities		108,294	12,254
Change in the WCR		19,959	61,182
Net cash from operating activities		151,153	183,525
Purchases of property, plant and equipment and intangible assets	9/10	-39,027	-29,917
Acquisitions of financial assets		-54,591	-28,682
Disposals of property, plant and equipment and intangible assets	9/10	2,764	3,481
Disposals of financial assets		-179	12
Impact of changes in scope ⁽¹⁾		-89,111	-30,887
Net cash from (used in) investing activities		-180,144	-85,994
Increase in share capital	19	21	-0
Dividends received		195	127
Dividends paid to non-controlling interests		-1,540	-2,220
Dividends paid to parent company shareholders		-39,563	-39,607
Change in financial receivables		-873	580
Change in lease liabilities	11	-42,346	-37,561
Change in financial liabilities	22	61,984	56,585
Net cash from financing activities		-22,122	-22,096
Impact of translation differences		1,005	2,831
CHANGE IN NET CASH		-50,108	78,266
Net cash at beginning of period		156,609	78,344
NET CASH AT END OF PERIOD		106,501	156,609
of which cash and cash equivalents		107,829	158,092
of which bank overdrafts		-1,328	-1,483

⁽¹⁾ principally Base Quantum (UK) €19 million and CAG (NH) €44.7 million

2022 ANNUAL REPORT

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

TO THE CONSOLIDATED FINANCIAL STATEMENTS

Note 1 PRESENTATION OF THE BUSINESS AND MAJOR EVENTS

Note 2 ACCOUNTING POLICIES AND METHODS

Note 3 REVENUE

Note 4 OPERATING INCOME AND EXPENSE

Note 5 OTHER FINANCIAL INCOME AND EXPENSES

Note 6 INCOME TAX

Note 7 GOODWILL

Note 8 ACQUISITIONS AND DISPOSALS

Note 9 INTANGIBLE ASSETS

Note 10 PROPERTY, PLANT AND EQUIPMENT

Note 11 LEASES

Note 12 DEFERRED TAX

Note 13 CURRENT AND NON-CURRENT FINANCIAL ASSETS

Note 14 OTHER CURRENT AND NON-CURRENT ASSETS

Note 15 INVENTORIES

Note 16 TRADE AND OTHER RECEIVABLES

Note 17 CONTRACT ASSETS AND LIABILITIES

Note 18 CASH AND CASH EQUIVALENTS

Note 19 CALLED-UP SHARE CAPITAL

Note 20 SHARE-BASED PAYMENTS

Note 21 DIVIDEND PER SHARE

Note 22 DEBT

Note 23 CURRENT AND NON-CURRENT FINANCIAL LIABILITIES

Note 24 LONG-TERM EMPLOYEE BENEFITS

Note 25 CONTINGENCY AND LOSS PROVISIONS

Note 26 OTHER NON-CURRENT LIABILITIES

Note 27 TRADE AND OTHER PAYABLES

Note 28 SEGMENT REPORTING

Note 29 INFORMATION ON FINANCIAL INSTRUMENTS

Note 30 FINANCIAL RISK MANAGEMENT

Note 31 HEADCOUNT

Note 32 OFF-BALANCE SHEET COMMITMENTS AND PLEDGES

Note 33 RELATED PARTY TRANSACTIONS

Note 34 EXECUTIVE REMUNERATION

Note 35 STATUTORY AUDITORS' FEES

Note 36 POST-BALANCE SHEET EVENTS

Note 37 SCOPE OF CONSOLIDATION

Note 38 SOCOTEC GROUP'S TRANSITION TO IFRS AT 1 JANUARY 2021 AND 31 DECEMBER 2021

NOTE 1 - PRESENTATION OF THE BUSINESS AND MAJOR EVENTS

1.1 - INFORMATION ABOUT THE COMPANY

Soco 1 SAS (hereinafter the "Company" or "SOCOTEC") is a société par actions simplifiée (simplified public limited company) registered in France. Its registered office is at 5 place des Freres Montgolfier in Guyancourt.

Soco 1 SAS (hereinafter the "Company") and all its subsidiaries together form the SOCOTEC Group (hereinafter referred to as "SOCOTEC" or "the Group").

SOCOTEC publishes consolidated financial statements pursuant to Article L. 233-16 of the French Commercial Code in line with the International Financial Reporting Standards (IFRS) issued by the IASB and adopted by the European Union. The consolidated financial statements for the year to 31 December 2022 cover a 12-month financial year. The comparatives cover a financial year of equivalent length.

These consolidated financial statements have been prepared under the authority of the Board of Directors, which approved them on 16 May 2023. The consolidated financial statements for the year to 31 December 2022 will be submitted for shareholders' approval at the Annual General Meeting to be held on 29 June 2023.

1.2 - OVERVIEW OF THE BUSINESS

Since it was founded in 1953, SOCOTEC has built up solid and recognised expertise, which it puts to work for its clients, helping them manage technical risks and ensure compliance with applicable standards and regulations in the areas of quality, health, safety and the environment. The SOCOTEC Group has developed its skills and its business activities specifically to serve the construction, real estate, industrial, energy and infrastructure sectors.

1.3 - HIGHLIGHTS OF 2022

Geopolitical events:

None of the Group's subsidiaries operate in geographical regions affected by the military conflict between Russia and Ukraine since February 2022. Nonetheless, the geopolitical uncertainties during 2022 drove up certain operating costs (inflationary effects on energy supplies, travel expenses, outsourcing and, to a limited extent, payroll costs) and slowed down construction projects as a result of supply chain disruption and higher raw materials costs. This effect was exacerbated the sharp increase in interest rates, which put a strain on organisations' finances. The inflation in certain costs was offset by unit price increases in short cycle businesses and a productivity/price indexation mix in long cycle businesses.

In addition, in the geographical regions active in the construction and real estate sector, the SOCOTEC group adjusted its Construction and Real Estate operations by focusing on existing buildings and on the fast-growing markets of providing support for the energy and environmental transition underway in the sector. The Group's swift response kept in check the effects of sluggish conditions in 2022.

In addition, SOCOTEC was buoyed by tailwinds in countries where the Group is active in the infrastructure sector (Italy, Germany, Spain, United Kingdom, Netherlands) owing to the massive volume of investments made by governments as the pandemic crisis receded. This enduring trend is underpinned by the ageing of existing infrastructure, such as shifts in certain countries' energy generating mix.

Revolving facility

In December 2022, Holding SOCOTEC arranged a new €106 million revolving facility under the framework of its existing senior documentation (the June 2021 Senior Facility Agreement), increasing the total revolving credit lines to €226 million.

Acquisitions

In 2022, the SOCOTEC Group pushed ahead with its acquisition-led growth strategy, completing a total of 13 deals. These acquisitions helped strengthen existing business lines in countries where the Group is already present (France, United States, United Kingdom, Italy, Germany, Netherlands) and to diversify its geographical presence in Europe, with expansion into the Spanish market.

•	Pfeifer - Germany - Construction & Real Estate (January 2022)
•	BAC Engineering Consultancy Group - Spain - Infrastructure (February 2022)
•	Eurogeo - Italy - Infrastructure (March 2022)
•	CSPS - France - Construction & Real Estate (April 2022)
•	Base Quantum - United Kingdom - Consulting (May 2022)
•	IMG - Italy - Infrastructure (July 2022)
•	CAG Groep - Netherlands - Environment and Construction & Real Estate (August 2022)
•	Ascaudit - France - Construction and Real Estate (August 2022)
•	Sestosensor- Italy - Infrastructure (September 2022)
•	Trinity - United States - ATIC (October 2022)
•	Russo Barr Associates - United States - ATIC (December 2022)
•	Quadrant - United Kingdom - Construction & Real Estate (December 2022)
•	Shore - United Kingdom - Construction & Real Estate (December 2022)

Outlook for 2023

Since the beginning of 2023, the Group has made two additional acquisitions across Germany:

•	In February, architect's office Höhlich & Schmotz joined the Group doubling Canzler's architectural capabilities and expanding its positions in Germany with the addition of two sites (Burgdorf and Mainz)
•	The acquisition of Marx Ingenieure by ZPP Ingenieure brought in engineering and industrial construction skills.

NOTE 2 - ACCOUNTING POLICIES AND METHODS

2.1 - BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

The consolidated financial statements are presented in thousands of euros and, unless stated otherwise, all the figures are rounded to the nearest thousand.

CONFORMITY WITH ACCOUNTING STANDARDS

SOCOTEC has prepared its consolidated financial statements pursuant to the International Financial Reporting Standards (IFRS) issued by the IASB and adopted by the European Union at the date at which the financial statements were prepared.

The international accounting standards comprise the IFRSs, IASs (International Accounting Standards), SICs (Standing Interpretations Committee) and IFRS ICs (International Financial Reporting Standards Interpretations Committee).

NEW STANDARDS

The following standards adopted by the European Union are mandatory for periods beginning on or after 1 January 2022, but did not have a material impact on the financial information presented:

•	Amendment to IAS 37 - Costs of Onerous Contracts
•	Amendment to IAS 16 - Proceeds before Intended Use
•	Amendment to IFRS 3 - Reference to the Conceptual Framework
•	Annual Improvements to IFRS Standards 2018-2020 (amendments to IFRS 9, IFRS 9, IFRS 41 and IFRS 16)

The following new standards, amendments to existing standards and interpretations have been published but are not mandatory for use in periods beginning on or after 1 January 2022 according to the European Union and have not been adopted early by SOCOTEC:

•	Amendment to IAS 1 - Disclosure of Accounting Policies
•	Update to Practice Statement 2 - Making materiality judgements
•	Amendment to IAS 8 - Definition of Accounting Estimates
•	IFRS 17 - Insurance Contracts
•	Amendment to IFRS 17 - First-time Adoption of IFRS 17 and IFRS 9 - Comparative Information
•	Amendment to IAS 12 - Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction
•	Amendment to IFRS 16 - Lease liability in a Sale and Leaseback

BASIS OF MEASUREMENT

The consolidated financial statements have been prepared based on the historical cost principle, except for certain financial instruments that are held at fair value, and certain financial liabilities that are measured at amortised cost.

The methods used to measure the fair value of these instruments are presented in Note 29 on the categories of financial assets and liabilities by accounting categories.

2.2 - USE OF ESTIMATES

In preparing the consolidated financial statements, management uses estimates and assumptions that may have affected the reported amounts of assets and liabilities at the end of the reporting period, as well as income statement items and revenues and expenses recognised directly in equity over the period. These estimates reflect economic inputs and assumptions that may vary over time and interpretations of local regulations. They are aligned with the inflationary economic environment. These estimates carry a number of uncertainties, chiefly arising from revenue recognition on a percentage of completion basis, provisions, the measurement of intangible assets and deferred tax assets, provisions for retirement benefit obligations, the fair value of derivatives, and the calculation of income tax expense.

The main judgements and estimates are analysed below:

Impairment of goodwill

Every year, the Group tests goodwill for impairment in line with the accounting method presented in Note 7 - Goodwill. The recoverable amounts of cash generating units have been determined based on calculations of value in use. These calculations are based on a number of assumptions presented in Note 7 - Goodwill.

Calculation of long-term employee benefits

The cost of long-term employee benefits managed under defined-benefit plans is estimated using actuarial valuation methods. These measurement techniques entail the use of a certain number of assumptions presented in detail in Note 24 - Long-term employee benefits. These estimates carry significant uncertainties because of the long-term nature of the relevant plans.

Lease term and measurement of right-of-use assets and lease liabilities

Lease liabilities represent the present value of future payments based on the lease terms in accordance with the accounting principle outlined in Note 11 - Leases. This lease term factors in extension options that are reasonably certain to be exercised. For leases extended by tacit agreement, the term is estimated based on the economics of the lease in a broad sense of the term. Management's judgement is called upon to decide whether medium- or long-term leases are reasonably certain to be extended.

Fair value of share-based payments

Share-based payments are recognised as expenses over the vesting period of the rights by reference to the fair value determined at the grant date for equity-settled share-based payments or at the reporting date for cash-settled share-based payments. The fair value of these payments is measured using the appropriate measurement models. These models require a number of parameters to be estimated that are laid out in detail in Note 20 - Share-based payments.

Income taxes

The Group is liable to income tax in various tax jurisdictions. The calculation of its corporate income tax expense on a worldwide basis requires management to use its judgement. The final estimate of the income tax expense is deemed reasonable in the ordinary course of business. The Group recognises a deferred tax asset resulting from temporary differences deductible for tax purposes and tax loss carryforwards insofar as the Group believes this tax asset to be recoverable in the future (see Note 12 - Deferred tax).

2.3 -FINANCIAL IMPACT OF CLIMATE CHANGE

The Group's financial statements include issues related to climate change.

The Group does not currently expect the commitments it has made concerning the transition to a lowcarbon economy to have a material impact on its financial statements.

SOCOTEC's annual carbon footprint conducted by the Group's CSR Department goes beyond the regulatory requirements and is ratified by Socotec Environnement's carbon expert.

It is incorporated under the "Implement the environmental transition" pillar of CSR strategy.

For the first time this year, the following international operations outside France were included in the SOCOTEC group's carbon footprint: Italy, Germany, the United Kingdom and the United States.

All these countries combined account for over 90% of consolidated revenue.

The Group's 2022 carbon footprint (Scopes 1+2+3*) amounted to 38,203 tCO ₂ eq , representing a carbon intensity of 4,045 tCO ₂ eq per person.

For the Group, that also represents an intensity of 36.98 tCO ₂ eq per million euros of revenue.

The Group's main sources of emissions break down as follows:

•	83% of GHG emissions originate from the corporate vehicle fleet
•	9% of GHG emissions originate from buildings' energy consumption
•	7% of GHG emissions originate from journeys by train or by plane, personal mileage allowances repaid
•	1% of GHG emissions originate from other indirect emissions (transportation of goods, internet, data centres, WEEE)

In 2020, the Management Committee set a target of reducing its carbon emissions by 15% by 2024. This target is one of the CSR strategy's four priority KPIs.

Accordingly, the carbon footprint in France conducted on a voluntary basis since 2020 can provide insights into trends in the footprint of our operations over the past three years. In tandem with the growth in SOCOTEC's business (revenue growth of 7% between 2021 and 2022) and the more comprehensive Scope 3 ^* assessment than in 2021, the carbon footprint in France has remained stable at 19,320 tCO ₂ eq in emissions in 2022 (up 0.12% compared with 2021). In addition, the downtrend in our carbon intensity (tCO ₂ emitted/millions of euros of revenue) continued during the year, coming in 7% below its 2021 level. Given the reduction it has posted for the past two years in a row, France has already reached the target of a 15% decrease it had initially targeted in 2024. The footprint per person of 3,568 tCO ₂ eq per person is on the same downward trajectory, falling 6% compared with 2021. These results build on the energy efficiency drive implemented by the Group to cut its energy consumption and GHG emissions.

⁽¹⁾ The carbon footprint data have not been audited by the Statutory Auditors.

Looking forward, our goals are:

•	Steady improvement in the completeness of the data reported (scope of publication, exhaustiveness of Scope 3 worldwide, etc.).
•	Steady improvement in processes producing data reported on a worldwide basis (automation and formal definitions, continuous training of contributors, third-party assurance of data).
•	Formal definition of a climate strategy with objectives in line with the main standards such as the TCFD recommendations (Task Force on Climate-Related Financial Disclosures) and SBTi methodology (Science Based Targets Initiative) to align the Group with the global warming trajectories of 1.5°C or 2°C, complying with the Paris Agreement.

^* Scope 3 includes:

―	In France: Plane, train, mileage allowances granted to employees in private vehicles; Transportation of goods; and since 2022: WEEE; Internet; Data centres
―	In the United Kingdom: Transportation of goods
―	In Italy: Plane; Train; Transportation of goods; Data centres
―	In Germany: Plane; Train
―	In the United States: Plane, train, mileage allowances granted to employees in private vehicles; Vehicle leases; Commuting journeys.

2.4 - CONSOLIDATION METHODS

Subsidiaries over which the Group directly or indirectly holds control in line with the percentages shown in Note 37 are consolidated.

All intercompany balances, income, expenses and cash flows (including gains or losses on intercompany transactions recognised in assets as inventories or non-current assets) are fully eliminated.

2.5 - PRESENTATION OF THE FINANCIAL STATEMENTS

SOCOTEC presents its financial statements in accordance with the principles laid down in IAS 1 - Presentation of Financial Statements.

In practice, depending on the nature of the business activities, the Group has opted to present the income statement by nature of expense. The operating income on ordinary activities includes all the recurring income and expense directly linked to the Group's business activities.

An entry is made under "Other operating income and expenses" when a major event that occurred during the accounting period would be liable to skew the picture of the Company's performance. It includes a very limited number of very large income and expense items that are unusual in terms of their frequency and nature.

Assets and liabilities related to the operating cycle and those with a maturity of less than 12 months of the reporting date are considered as current. Other assets and liabilities are considered as non-current.

The Group prepares the consolidated statement of cash flows using the indirect method and in accordance with the provisions of IAS 7. Under the indirect method, cash flows from operating activities, with net income adjusted for non-cash transactions, and cash from (used in) investing and financing activities are calculated.

2.6 - TRANSLATION OF THE FINANCIAL STATEMENTS OF FOREIGN SUBSIDIARIES

These consolidated financial statements are presented in euros, the Company's functional currency.

The financial statements of the Group's foreign subsidiaries are denominated in their functional currency, which is the currency of the economic environment in which these entities principally operate. In most cases, the functional currency is the local currency.

The assets (including goodwill) and liabilities of entities with a different functional currency that is not the same as the reporting currency are translated into euros at the exchange rate in force at the reporting date. The income statement and statement of cash flows items are translated at the average exchange rate for the period where this rate represents a reasonable estimate of the exchange rates for the transactions used at the transaction date in the absence of significant differences. Any translation gains and losses are recognised in "Other comprehensive income".

One of the Group's subsidiaries is located in Lebanon, which is considered as a hyperinflationary economy according to the definition laid down in IAS 29. Nonetheless, the impact is not material.

2.7 - TRANSLATION OF FOREIGN CURRENCY TRANSACTIONS

Under IAS 21, foreign currency transactions are initially translated and recorded in the functional currency of the relevant entity at the rates in force at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies at the end of the reporting period are translated into the subsidiary's functional currency at the closing exchange rate. All resulting foreign exchange gains and losses are recognised in income.

NOTE 3 - REVENUE

ACCOUNTING POLICIES

RECOGNITION OF REVENUE

Revenue is recognised when control of goods and services has transferred to the customer in accordance with IFRS 15 - Revenue, it is probable that the amount of the sale will be recovered, and the costs and amount of revenue can be reliably measured.

Certain Group contracts give rise to multiple short-term assignments. The Group recognises revenue under these contracts at the date of completion of each assignment.

Long-cycle contracts, including construction and infrastructure activities, give rise to the recognition of revenue on a percentage of completion basis. The recognition of revenue is based on actual progress on projects, which reflects the handover of deliverables under the performance obligation.

	Revenue
(€ thousands)	2022	2021
France	559,394	532,108
United Kingdom	171,480	162,458
Germany	131,037	112,613
United States	126,280	105,891
Italy	65,414	37,291
Netherlands	33,150	5,108
Spain	25,617	0
International/Other countries	44,228	42,258
TOTAL	1,156,599	997,727

NOTE 4 - OPERATING INCOME

ACCOUNTING POLICIES

OPERATING INCOME

The consolidated income statement shows an operating income line consisting of recurring income and expenses and other operating income and expense.

"Operating income" is thus defined as the difference between all the income and expenses that do not result from either financing activities, equity-accounted companies or income tax, and excludes any businesses held for held pursuant to IFRS 5 "Assets held for sale and discontinued operations".

The following table shows other operating income items after revenue (shown in Note 3)

(€ thousands)	2022	2021
Remuneration of permanent staff	-460,420	-382,601
Payroll taxes	-132,330	-114,935
Share-based payment	-8,928	-9,745
Employee profit sharing	-6,777	-8,376
Earn-out (remuneration)	-4,593	-5,689
Other staff costs	0	-86
Total staff costs	-613,048	-521,432
Production outsourcing	-103,622	-76,454
Purchases of materials and supplies not transferred to inventory	-25,167	-24,323
Vehicle fuel	-19,666	-13,777
IT costs	-12,046	-10,789
Property and equipment rentals	-32,111	-29,050
Servicing and repairs	-24,838	-20,095
Insurance premiums and other services	-34,821	-31,427
Professional fees	-17,715	-12,612
External staffing costs	-9,503	-10,994
Travel, assignment, handovers	-35,709	-25,725
Other external services	-11,657	-12,939
Total purchases and external charges	-326,854	-268,185
Remuneration-based levies	-5,538	-4,830
Other levies	-4,328	-4,871
Total taxes other than on income	-9,866	-9,701
Depreciation and amortisation of non-current assets	-87,822	-78,130
Additions to provisions net of reversals	-2,637	-9,524
Additions to exceptional provisions net of reversals	356	-1,441
Additions to goodwill impairment losses	0	-18,216
Net additions to depreciation, amortisation and provisions	-90,104	-107,310
Other income - Other operating income	1,662	693
Exceptional income/operating and capital transactions	1,330	1,846
Exceptional expenses/operating and capital transactions	-11,080	-7,925
Restructuring costs	-5,792	-6,352
Payments of deductibles under civil liability insurance policy	-2,090	-1,997
Losses on receivables written off	-2,020	-5,175
Other operating expenses and income	1,567	3,673
Total other operating income and expense	-16,423	-15,238

¹ "Other external services" includes telecoms, postage, advertising and public relations expenses, goods held for resale and other supplies.
² The "Allowances to provisions for goodwill" includes impairment of the goodwill recognised on Socotec Monitoring France in 2021.

NOTE 5 - OTHER FINANCIAL INCOME AND EXPENSES

(€ thousands)	2022	2021
Foreign exchange gains and losses	-12,567	-1,372
Other	-2,645	-3.354
OTHER FINANCIAL INCOME AND EXPENSES	-15,212	-4,726

The change in foreign exchange gains and losses reflects the USD Dollar/Euro currency effect on the proportion denominated in US dollars of the Term B loan.

The "Other" line item includes discounting expenses related to the options on securities. At 31 December 2022, the "Other" line included:

•	discounting expenses related to the options on securities (€-4 million in 2022, €-3.2 million in 2021)
•	the financial impact of retirement benefit obligations (€-0.2 million in 2022 and €-0.6 million in 2021).

NOTE 6 - INCOME TAX

ACCOUNTING POLICIES

Income tax consists of current and deferred tax. Tax is recognised in income unless it relates to a business combination, to items recognised directly in equity, or to income and expenses recognised in equity.

CURRENT TAX

Current tax includes the estimated amount of tax payable (or receivable) in respect of taxable earnings (or loss) in a period, or any adjustment to the amount of current tax in prior periods.

Tax payable (or receivable) is calculated at the tax rates enacted or substantively enacted at the reporting date.

DEFERRED TAX

Deferred tax is recognised to reflect the temporary difference between the carrying amount and tax base of certain assets and liabilities. See Note 11 - Deferred tax

The income tax payable on consolidated earnings breaks down into current and deferred tax as follows:

(€ thousands)	2022	2021
Current tax	-23,117	-24,526
Deferred tax	3,613	9,779
INCOME TAX EXPENSE	-19,504	-14,747

The effective tax rate, which is defined as the tax expense divided by income before tax, stood at 47.18% in 2022 (versus 51.92% in 2021).

(€ thousands)	2022	2021
Profit before tax (A)	41,336	28,406
Income tax expense (B)	-19,504	-14,747
EFFECTIVE TAX RATE (B/A)	47.18%	51.92%

The research tax credit is classified in subsidies under other operating income.

The CVAE levy is reclassified under income tax expense.

Differences between actual tax expense and theoretical tax expense obtained by applying the tax rate in force in France to consolidated income before tax are as follows:

(€ thousands)	2022	2021
Profit before tax	41,336	28,406
Parent company's tax rate	25.83%	28.41%
Theoretical income tax based on the parent company's tax rate	-10,677	-8,069
Impact of tax loss carryforwards (recognition/non-recognition of deferred tax)	-3,574	8,894
Consolidated tax regime	13,539	3,059
Impact of tax exemptions	-13,622	-6,600
Impact of non-deductible interest	-2,396	-3,169
Impact of tax credits	164	174
Impact of differences in tax rates	29	-1,664
Management incentive packages	-2,165	-2,376
Other reconciliation items	-802	-4,995
Effective tax recorded	-19,504	-14,747
EFFECTIVE TAX RATE	47.18%	51.92%

The impact of exemptions largely reflect the reclassification of the CVAE levy, the portion of expenses and charges on dividends and withholding taxes.

Other reconciliation items include prior-period tax adjustments, capital gains on disposals, and permanent differences (fines, tax on company cars, etc.).

The Group has elected for the consolidated tax regime in several countries, chiefly France and Germany. Any tax savings made by the consolidated tax groups, including as a result of the tax losses of consolidated companies are treated as an immediate gain for the Company.

NOTE 7 - GOODWILL

ACCOUNTING POLICIES

Goodwill represents the difference between the acquisition price (plus any acquisitions of noncontrolling interests) and the net amount recognised for the identifiable assets acquired and the liabilities assumed. For an acquisition of control where there are non-controlling interests (acquisition of less than 100%), the Group may elect either to recognise goodwill on all remeasured net assets, including the share attributable to non-controlling interests (full goodwill method) or to recognise only goodwill for the proportionate share actually acquired of the remeasured net assets (partial goodwill method). This choice is made on a transaction by transaction basis.

This goodwill is allocated to the various cash generating units (CGUs) based on the value in use contributed to each of them.

Where the cost of the business combination is less than the fair value of the assets and liabilities, the negative goodwill is recognised immediately in income under "Other operating income and expense". Acquisition-related costs are recognised in income under "Other operating income and expense" as they are incurred.

IMPAIRMENT TEST

Goodwill is not amortised but is tested for impairment on an annual basis, or whenever events or changes in the market environment indicate a risk of impairment.

To test for any loss in value of the goodwill, the Group allocates the goodwill to CGUs or groups of CGUs with synergies identified during the business combination that have given rise to goodwill, i.e. to each business segment in which it operates businesses given their global management.

Whenever there is an indicator of impairment in one of the assets making up the CGU, the asset is tested for impairment and any loss in the value of the asset is recognised before the CGU is tested for impairment. Similarly, when there is an indicator of impairment for a CGU, any impairment losses on the CGU are recognised before testing the group of CGUs to which the goodwill was allocated.

An impairment loss is recognised in respect of the difference between the carrying amount and the recoverable amount of the CGU or group of CGUs. The recoverable amount of a CGU or group of CGUs is the higher of value in use and fair value less costs to sell.

Goodwill impairment losses are irreversible. They are recognised in the same currency as the goodwill corresponding to the currency of the entities acquired.

Changes in goodwill in 2022

(€ thousands)	Year to 31 December 2022	Year to 31 December 2021
Gross	745,115	711,025
Impairment losses	-18,216	0
Goodwill at 1 January	726,899	711,025
Acquisitions during the period	112,036	20,783
Disposals for the period
Translation differences and other movements	34,512	13,307
Goodwill at 31 December	873,448	745,115
Gross	873,448	745,115
Impairment losses	-18,216	-18,216
GOODWILL AT 31 DECEMBER	855,232	726,899

Allocation of goodwill to the CGUs in 2022

Goodwill allocated to the main cash generating units (CGUs) (the operating segments used by the Group for reporting purposes) at 31 December 2022 break down as follows:

(€ thousands)	At 31 December 2022	At 31 December 2021
France	270,590	259,526
United States	325,887	293,030
United Kingdom	86,719	73,223
Germany	60,076	55,243
Netherlands	59,565	16,306
Italy	35,391	22,785
Spain	10,020
International/Other countries	6,984	6,786
TOTAL	855,232	726,899

Impairment tests - 2022 methodology and results

At each reporting date, and whenever there are indicators of impairment in certain assets, the Group's goodwill is tested for impairment. To this end, goodwill is allocated to groups of cash generating units or to cash generating units (CGUs).

The Group's results are presented via CGUs: France, United States, United Kingdom, Germany, Netherlands, Italy, Spain and International/Other countries.

Value in use represents the excess future cash flows generated by the CGU. These cash flows are calculated after maintenance capex and any non-recurring items. They are also net of tax, but exclude external financing costs. They are based on the latest available medium- and long-term earnings forecasts available.

Two factors affect the results of these estimates:

Growth assumption: the excess cash flows depend on the performance of a group of CGUs or a CGU. This performance is based on growth assumptions over a five-year period. Beyond this period, the performance is calculated based on a projected perpetual growth rate close to the inflation rate of the group of CGUs or CGU.

Discount rate: the estimate of the value in use is based on the excess future cash flows discounted at the weighted average cost of capital ("WACC"). This is a rate after tax. It is adjusted to the Group's business activities and to the various geographical regions in which the groups of CGUs or CGUs operate.

The growth rates and discount rates adopted by CGU are as follows:

	2022		2021
	Discount rate	Growth rate	Discount rate	Growth rate
France	8.1%	1.6%	7.2%	1.5%
United Kingdom	8.1%	2.0%	7.2%	1.5%
United States	7.6%	2.0%	6.7%	1.5%
Italy	10.0%	2.0%	7.2%	1.5%
Germany	7.6%	2.0%	6.7%	1.5%
Netherlands	7.6%	2.0%	8.2%	1.5%
Spain	10.0%	1.7%	6.8%	1.5%
Other	12.0%	2.4%	11.1%	1.5%

Sensitivity analysis

The sensitivity parameters that may have a material impact on the results of the impairment testing are operating income, the WACC and the perpetual growth rate.

Even so, no reasonably likely change in the key assumptions for a single parameter leads to the recoverable amount of a group of CGUs or a CGU being below its carrying amount.

We carried out a sensitivity test by increasing the WACCs by 0.5% and lowering the perpetual growth rate by 0.25%, but that did not give rise to any indication of impairment.

NOTE 8 - ACQUISITIONS AND DISPOSALS

Acquisitions during the period

During 2022, the Group completed the following acquisitions:

Acquisitions of full ownership

Month of acquisition	Company name	Business	Country	Impact on 2022 operating income
				(€ thousands)
January	Pfeifer Consult & Pfeifer Interplan	Construction & Real Estate	Germany
March	Eurogeo	Infrastructure	Italy	1,323
April	CSPS	Construction & Real Estate	France	97
July	IMG	Infrastructure	Italy	662
August	Ascaudit	Construction & Real Estate	France	242
August	New Blue (CAG Groep)	Environment and Construction & Real Estate	Netherlands	1,366
September	Sestosensor	Infrastructure	Italy	121
October	Trinity	ATIC	United States
December	Russo Barr Associates	ATIC	United States
December	Vernier Holdings (Quadrant)	Construction & Real Estate	United Kingdom
December	Shore Engineering	Construction & Real Estate	United Kingdom

Acquisitions of less than full ownership

Month of acquisition	Company name	Business	Percentage acquired	Country	Impact on 2022 operating income
					(€ thousands)
February	BAC Engineering Consultancy Group	Infrastructure	91.83%	Spain	1,793
May	Base Quantum	Advisory services	70.00%	UK	1,248

The Group acquired Quadrant and Shore in December 2022. Given the late timing of these acquisitions in the financial year, the shares in these companies were recognised in unconsolidated investments at 31 December 2022. The impact on the income statement was not material.

To determine the amount of goodwill arising from these acquisitions, the partial goodwill method was applied whereby the non-controlling interests are measured based on their proportionate share of the fair value of net identifiable assets acquired.

The amount of goodwill recognised in 2022 was €112 million. Of this total, €46 million was for acquisitions in the Netherlands, €18 million for the acquisition of Base Quantum, €13 million for acquisitions in France, €10 million for the acquisition in Spain and €11 million for acquisitions in France.

The amount of goodwill recognised in 2022 is provisional. The allocation of the cost of the acquisitions completed in 2022 to identifiable assets, liabilities and contingent liabilities will be completed in the first year following the date of acquisition in line with the guidelines laid out in IFRS 3.

NOTE 9 - INTANGIBLE ASSETS

ACCOUNTING POLICIES

CUSTOMER RELATIONSHIPS

In accounting for certain business combinations where the nature of the customer portfolio held by the acquired entity and the nature of its business activities should enable the acquired entity to maintain its commercial relationships owing to the efforts made to retain their loyalty, the customer relationships are recognised as intangible assets and amortised over the estimated useful life of the contracts held at the date of acquisition. The estimated useful life varies between 7 and 20 years depending on the rate of attrition calculated for each of these assets.

BRANDS

In accounting for certain business combinations, brands are recognised as intangible assets and amortised over the estimated useful life of the contracts held at the date of acquisition. An estimated useful life of 5 years is generally applied.

LICENCES AND SOFTWARE

Wholly-owned software and rights of use and internally developed software and solutions with a positive, sustained and measurable impact on future earnings are capitalised and amortised over a period of between 3 and 5 years. The capitalised cost of internally developed software and solutions are those directly associated with their production, or expenses arising from the staff costs of the employees who developed the software.

IMPAIRMENT TEST

The amortised assets are tested for impairment when, as a result of specific events, the recoverability of their carrying amount appears uncertain. For the purpose of measuring an impairment loss, all assets are grouped into cash generating units (CGU) or groups of CGUs.

For customer relationships, indicators of impairment are identified through an analysis that is to based on:

•	quantitative information (e.g. three-year trends in revenue, coverage of operating income adjusted for amortisation of customer relationships);
•	qualitative information (e.g. loss of a major long-standing customer, decision to proceed with major restructuring).

In carrying amount of an asset is immediately written down to its recoverable amount. If the asset's carrying amount is higher than its estimated recoverable amount.

(€ thousands)	At 31 December 2021	Increases/ Additions	Disposals
Concessions, patents, licences and software	49,853	3,257	-972
Trademark1	31,558	0	0
Customer relationships2	300,203	0	0
Assets in progress	4,432	11,187	-667
Other intangible assets	1,480	-38	-13
Gross	387,525	14,407	-1,651
Concessions, patents, licences and software	-39,046	-6,767	908
Customer relationships	-104,693	-24,041	0
Other intangible assets	-476	-271	13
Amortisation and provisions	-144,215	-31,079	921
Concessions, patents, licences and software	10,806	-3,510	-63
Trademark	31,558	0	0
Customer relationships	195,510	-24,041	0
Assets in progress	4,432	11,187	-667
Other intangible assets	1,004	-309	-0
NET INTANGIBLE ASSETS	243,311	-16,672	-730

(€ thousands)	Changes in scope of consolidation	Translation differences	Other movements	At 31 December 2022
Concessions, patents, licences and software	5,805	-357	2,021	59,607
Trademark1	1,108	197	370	33,233
Customer relationships2	3,851	6,987	-370	310,671
Assets in progress	90	0	-1,892	13,150
Other intangible assets	3,588	8	96	5,122
Gross	14,442	6,834	225	421,782
Concessions, patents, licences and software	-3,990	209	-365	-49,051
Customer relationships	0	-1,416	-0	-130,149
Other intangible assets	-2,882	14	-3	-3,605
Amortisation and provisions	-6,872	-1,193	-368	-182,805
Concessions, patents, licences and software	1,815	-148	1,656	10,556
Trademark	1,108	197	370	33,233
Customer relationships	3,851	5,571	-370	180,521
Assets in progress	90	0	-1,892	13,150
Other intangible assets	706	22	93	1,516
NET INTANGIBLE ASSETS	7,570	5,642	-143	238,977

(€ thousands)	At 31 December 2020	Increases/Additions	Disposals
Concessions, patents, licences and software	42,351	1,451	-461
Trademark	31,104	0	0
Customer relationships	266,337	0	0
Assets in progress	4,361	5,964	-345
Other intangible assets	1,139	317	0
Gross	345,291	7,732	-806
Concessions, patents, licences and software	-31,883	-6,684	121
Customer relationships	-76,974	-25,079	0
Other intangible assets	-415	-47	0
Amortisation and provisions	-109,272	-31,811	121
Concessions, patents, licences and software	10,468	-5,233	-340
Trademark	31,104	0	0
Customer relationships	189,363	-25,079	0
Assets in progress	4,361	5,964	-345
Other intangible assets	724	270	0
NET INTANGIBLE ASSETS	236,019	-24,079	-685

(€ thousands)	Changes in scope of consolidation	Translation differences	Other movements	At 31 December 2021
Concessions, patents, licences and software	249	488	5,775	49,853
Trademark	223	231	0	31,558
Customer relationships	13,455	10,205	10,207	300,203
Assets in progress	0	0	-5,547	4,432
Other intangible assets	0	24	0	1,480
Gross	13,926	10,948	10,435	387,525
Concessions, patents, licences and software	-119	-304	-176	-39,046
Customer relationships	0	-2,640	-0	-104,693
Other intangible assets	0	-14	-0	-476
Amortisation and provisions	-119	-2,958	-176	-144,215
Concessions, patents, licences and software	130	183	5,598	10,806
Trademark	223	231	0	31,558
Customer relationships	13,455	7,565	10,207	195,510
Assets in progress	0	0	-5,547	4,432
Other intangible assets	0	11	0	1,004
NET INTANGIBLE ASSETS	13,807	7,991	10,258	243,311

Intangible assets include the following:

•	Customer relationships and brands acquired in a business combination
•	Purchased software and internally developed software

The "Concessions, patents, licences and software" line item chiefly consists of software with a gross value at 31 December 2022 of €59.6 million, of which €15 million in France and €8 million in the United Kingdom. The gross value of software at 31 December 2021 was €49.9 million. Of the increase, €5.8 million was attributable to the new entities acquired in 2022.

Amortisation of intangible assets totalled €31.1 million in 2022 (versus €31.8 million in 2021).

The Brands and Customer relationships line items include the intangible assets recognised through purchase price allocations.

(€ thousands)	Intangible asset	Amortisation period (years)	Start date	Gross
1 Trademark				33,233
Schollenberger	Trademark	5	11/1/2018	1,908
Vidaris	Trademark	3	8/1/2019	3,217
David Pattillo & Associates	Trademark	3	11/1/2019	234
Veritas Advisory Group	Trademark	3	10/1/2020	366
Hanselman	Trademark	5	8/1/2021	543
Inpijn	Trademark	5	1/1/2022	565
Holding SOCOTEC	Trademark	n/a		26,400
2Customer relationships				310,671
Holding SOCOTEC	Customer relationships	22	1/1/2013	132,500
ESG	Customer relationships	8	3/1/2017	14,241
Controle Inspection Supervision	Customer relationships	7	5/1/2017	3,950
Schollenberger	Customer relationships	20	11/1/2018	8,652
Schollenberger	Customer relationships	10	11/1/2018	2,041
Vidaris	Customer relationships	13	8/1/2019	54,076
Vidaris	Customer relationships	12	8/1/2019	39,852
Vidaris	Customer relationships	13	8/1/2019	13,281
David Pattillo & Associates	Customer relationships	6	11/1/2019	1,078
Veritas Advisory Group	Customer relationships	8	10/1/2020	10,313
Cementys	Customer relationships	5	11/1/2020	3,501
Hanselman	Customer relationships	15	8/1/2021	3,100
Inpijn	Customer relationships	15	1/1/2022	462
Inpijn	Customer relationships	15	1/1/2022	289
Vidaris	Order backlog	3	8/1/2019	12,065
Vidaris	Order backlog	2	8/1/2019	1,694
Cementys	Technology	20	11/1/2020	8,930
Veritas Advisory Group	Non-compete commitment	5	10/1/2020	647

NOTE 10 - PROPERTY, PLANT AND EQUIPMENT

ACCOUNTING POLICIES

ACQUISITION, CONSTRUCTION AND DEPRECIATION

Property, plant and equipment is recognised on the consolidated statement of financial position at its historical cost, less depreciation and any impairment losses. It is not revalued. Buildings owned by the Group have been measured using the component approach. Subsequent expenditure improving the benefits to be derived from assets (replacement expenditure and upgrade and compliance expenditure) is capitalised and depreciated over the remaining life of the relevant noncurrent asset. Recurring servicing and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method based on the estimated useful life of the various categories of non-current assets. It is calculated based on the purchase price, less any residual value.

The non-current assets are depreciated according to their estimated useful life as follows:

Buildings	20 to 50 years
Installations	10 years
Plant and equipment	5 to 10 years
Vehicles	4 to 5 years
Office equipment	5 to 10 years
IT equipment	3 to 5 years
Furniture	10 years

The residual values and estimated useful lives are reviewed at each reporting date.

Capital gains or losses on disposals arise from the difference between the sale price and the carrying amount of the assets sold.

IMPAIRMENT TEST

The depreciated assets are tested for impairment when, as a result of specific events, the recoverability of their carrying amount appears uncertain. For the purpose of measuring an impairment loss, all assets are grouped into cash generating units (CGU) or groups of CGUs.

The carrying amount of an asset is immediately written down to its recoverable amount if the asset's carrying amount is higher than its estimated recoverable amount.

(€ thousands)	At 31 December 2021	Increases/ Additions	Disposals
Land	479	1	-21
Buildings	14,174	296	-953
Plant and equipment	87,724	13,665	-1,138
General installations, fixtures and fittings	50,772	2,260	-2,720
Computer equipment	36,927	3,786	-1,127
Other property, plant and equipment	14,847	6,438	-1,296
Gross	204,924	26,446	-7,256
Land	-0	-5	0
Buildings	-4,778	-731	503
Plant and equipment	-57,236	-10,594	1,048
General installations, fixtures and fittings	-25,430	-4,094	2,506
Computer equipment	-31,697	-3,794	523
Other property, plant and equipment	-8,071	-1,780	1,176
Impairment	-127,212	-20,998	5,755
Land	479	-3	-21
Buildings	9,396	-434	-451
Plant and equipment	30,488	3,070	-90
General installations, fixtures and fittings	25,342	-1,834	-215
Computer equipment	5,230	-9	-604
Other property, plant and equipment	6,776	4,658	-120
NET PROPERTY, PLANT AND EQUIPMENT	77,712	5,448	-1,500

(€ thousands)	Changes in scope of consolidation	Translation differences	Other movements	At 31 December 2022
Land	0	-2	-0	458
Buildings	190	-92	393	14,008
Plant and equipment	9,067	-1,619	-207	107,493
General installations, fixtures and fittings	1,463	16	2,914	54,704
Computer equipment	3,262	-59	488	43,277
Other property, plant and equipment	6,660	16	-3,340	23,326
Gross	20,642	-1,739	248	243,266
Land	0	0	0	-5
Buildings	-126	35	-353	-5,450
Plant and equipment	-5,909	751	54	-71,887
General installations, fixtures and fittings	-822	-51	-268	-28,158
Computer equipment	-2,401	27	-200	-37,541
Other property, plant and equipment	-4,984	-7	-14	-13,680
Impairment	-14,241	755	-780	-156,721
Land	0	-2	0	453
Buildings	64	-56	40	8,558
Plant and equipment	3,158	-868	-153	35,606
General installations, fixtures and fittings	641	-35	2,646	26,546
Computer equipment	862	-32	288	5,736
Other property, plant and equipment	1,677	9	-3,354	9,646
NET PROPERTY, PLANT AND EQUIPMENT	6,401	-984	-532	86,545

(€ thousands)	At 31 December 2020	Increases/Additions	Disposals
Land	612	5	-179
Buildings	14,988	663	-1,900
Plant and equipment	69,875	12,056	-736
General installations, fixtures and fittings	45,286	2,499	-113
Computer equipment	33,748	3,733	-1,607
Other property, plant and equipment	12,803	2,128	-933
Gross	177,313	21,084	-5,468
Land	-0	-1	0
Buildings	-4,677	-767	739
Plant and equipment	-45,517	-8,283	548
General installations, fixtures and fittings	-20,569	-4,319	64
Computer equipment	-29,338	-3,210	1,567
Other property, plant and equipment	-6,114	-1,615	802
Impairment	-106,215	-18,195	3,720
Land	612	4	-179
Buildings	10,311	-104	-1,161
Plant and equipment	24,358	3,773	-188
General installations, fixtures and fittings	24,717	-1,820	-49
Computer equipment	4,410	523	-40
Other property, plant and equipment	6,689	513	-131
NET PROPERTY, PLANT AND EQUIPMENT	71,097	2,890	-1,749

(€ thousands)	Changes in scope of consolidation	Translation differences	Other movements	At 31 December 2021
Land	40	1	-0	479
Buildings	449	94	-119	14,174
Plant and equipment	4,827	1,678	25	87,724
General installations, fixtures and fittings	675	112	2,312	50,772
Computer equipment	714	347	-9	36,927
Other property, plant and equipment	1,875	97	-1,123	14,847
Gross	8,580	2,329	1,087	204,924
Land	-14	0	15	-0
Buildings	-170	-29	126	-4,778
Plant and equipment	-3,187	-783	-14	-57,236
General installations, fixtures and fittings	-348	-74	-183	-25,430
Computer equipment	-638	-276	199	-31,697
Other property, plant and equipment	-1,083	-77	16	-8,071
Impairment	-5,440	-1,239	158	-127,212
Land	26	1	15	479
Buildings	279	65	7	9,396
Plant and equipment	1,640	895	11	30,488
General installations, fixtures and fittings	326	39	2,129	25,342
Computer equipment	76	70	190	5,230
Other property, plant and equipment	792	20	-1,107	6,776
NET PROPERTY, PLANT AND EQUIPMENT	3,140	1,089	1,245	77,712

Depreciation of property, plant and equipment amounted to €21 million in 2022. In 2021, it totalled €18.2 million.

NOTE 11 - LEASES

ACCOUNTING POLICIES

Under IFRS 16 - Lease, the Group must identify whether a contract is (or contains) a lease, i.e. whether it conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The relevant contracts are principally property, vehicles, IT equity and other equipment leases.

Leases give rise to the recognition on the balance sheet of an asset (representing the right to use the leased asset throughout the term of the lease) and a liability (representing the obligation to make the lease payments).

LEASE LIABILITIES

Upon lease commencement, the lease liability is the present value of the lease payments payable over the lease term. The lease payments are discounted at the lessee's incremental borrowing rate in each country. The lease payments included in measurement of the lease liability include fixed lease payments, variable lease payments based on a rate or index (using the rate or index at the commencement date), termination or lease non-renewal penalties. The lease term is the non-cancellable period for which the Group has the right to use the underlying asset, plus periods covered by an extension option if exercise of that option is considered reasonably certain and periods covered by a termination option if the Group does not expect to exercise that option.

It is then calculated at amortised cost using the effective interest rate method:

•	it is increased in respect of interest expense identified by applying the discount rate to the liability at the beginning of the period:
•	itis reduced by the amount of payments made.

RIGHT-OF-USE ASSETS

Upon lease commencement, the right-of-use asset is measured at its cost including the initial amount of the liability, advance payments to the lessor and initial direct costs incurred in arranging the lease. This asset may also include an estimate of the costs of asset restoration obligations under the terms of the lease. For its vehicle fleet, the Group has opted not to separate lease components from non-lease components, and instead account for all of them as a single lease arrangement. The right-of-use asset for leases is depreciated over the same period used to calculate the lease liabilities.

In the income statement, depreciation expense is recognised in operating income and interest expense in financial income.

LEASE TERM

The lease term is the non-cancellable period of a lease.

INCREMENTAL BORROWING RATE

The incremental borrowing rate is determined based on the borrowing profile of the Group entities and the lease term.

DEFERRED TAX

The tax impact of this accounting treatment is handled by recognising deferred taxes in line with the tax legislation in the countries in which the leases are recognised.

EXEMPTIONS

The Group has elected to use both exemptions proposed by the standard for the following leases:

•	Leases where the underlying asset has a low value (replacement value of less than €5,000), except for IT equipment;
•	Short-term leases (less than 12 months from the original lease commencement date).

Payments under these leases are recognised directly in lease expenses in operating expenses.

Right-of-use assets

(€ thousands)	At 31 December 2021	Increases/Additions	Decreases
Real estate	98,424	40,635	-2,921
Vehicles	20,318	16,389	-5,854
Other assets	511	3,003	-21
Gross	119,253	60,027	-8,797
Real estate	-19,476	-24,069	271
Vehicles	-6,600	-11,502	57
Other assets	-192	-1,266	0
Impairment	-26,269	-36,836	328
Real estate	78,948	16,566	-2,651
Vehicles	13,718	4,887	-5,797
Other assets	319	1,738	-21
NET RIGHT-OF-USE ASSETS	92,985	23,190	-8,469

(€ thousands)	Disposals	Translation differences	Other movements	At 31 December 2022
Real estate	-4,296	-355	0	131,486
Vehicles	-5,896	-400	1	24,558
Other assets	-158	-0	0	3,335
Gross	-10,351	-755	1	159,379
Real estate	4,296	105	7	-38,866
Vehicles	5,896	223	-0	-11,926
Other assets	158	0	0	-1,300
Impairment	10,351	328	7	-52,092
Real estate	0	-250	7	92,620
Vehicles	0	-177	1	12,632
Other assets	0	-0	0	2,035
NET RIGHT-OF-USE ASSETS	0	-427	8	107,287

(€ thousands)	At 31 December 2020	Increases/Additions	Decreases
Real estate	83,348	14,968	-381
Vehicles	11,570	15,156	-5,779
Other assets	372	141	0
Gross	95,290	30,265	-6,160
Real estate	0	-20,399	0
Vehicles	0	-7,538	0
Other assets	0	-194	0
Impairment	0	-28,132	0
Real estate	83,348	-5,431	-381
Vehicles	11,570	7,618	-5,779
Other assets	372	-54	0
NET RIGHT-OF-USE ASSETS	95,290	2,133	-6,160

(€ thousands)	Disposals	Translation differences	Other movements	At 31 December 2021
Real estate	-1,080	1,569	0	98,424
Vehicles	-992	364	-0	20,318
Other assets	-2	0	0	511
Gross	-2,074	1,933	0	119,253
Real estate	1,080	-157	0	-19,476
Vehicles	992	-54	0	-6,600
Other assets	2	0	0	-192
Impairment	2,074	-211	0	-26,269
Real estate	0	1,412	0	78,948
Vehicles	0	310	-0	13,718
Other assets	0	0	0	319
NET RIGHT-OF-USE ASSETS	0	1,721	0	92,985

Depreciation of right-of-use assets totalled €36.8 million in 2022 (versus €28.1 million in 2021).

Lease liabilities

At 31 December 2022, movements in and the maturity schedule of lease liabilities were as follows:

(€ thousands)	At 31 December 2021	Increases	Decreases
LEASE LIABILITIES	96,923	58,038	-2,417

(€ thousands)	Repayments	Financial expense	Translation differences	At 31 December 2022
LEASE LIABILITIES	-42,346	4,605	-453	114,350

(€ thousands)	At 31 December 2021	Increases	Decreases
LEASE LIABILITIES	99,240	30,388	-384

(€ thousands)	Repayments	Financial expense	Translation differences	At 31 December 2022
LEASE LIABILITIES	-37,460	3,448	1,691	96,923

(€ thousands)	Total	Less than 1 year	1 to 5 years	Over 5 years
AT 31 DECEMBER 2022
Non-current lease liabilities	79,420		62,629	16,791
Current lease liabilities	34,930	34,930

(€ thousands)	Total	Less than 1 year	1 to 5 years	Over 5 years
AT 31 DECEMBER 2021
Non-current lease liabilities	66,086		55,146	10,940
Current lease liabilities	30,838	30,838

The amount of the repayment in the statement of cash flows includes a €42.3 million repayment in 2022 (€37.5 million in 2021), as well as the €4.6 million in interest expense for the year in 2022 (€3.5 million in 2021).

The IFRS 16-exempt lease expense was €20 million in 2022. Most of this expense related to short-term leases.

Future lease payments (not discounted) included in the lease liabilities were as follows:

(€ thousands)	2023	2024	2025	2026	2027
Real estate	25,292	22,117	17,950	15,008	11,640
Vehicles	13,465	3,664	1,307	521	203
Other assets	952	582	364	181	102
Gross	39,708	26,363	19,621	15,711	11,944

NOTE 12 - DEFERRED TAX

ACCOUNTING POLICIES

Deferred tax is:

―	recognised to reflect the temporary difference between the carrying amount and tax base of certain assets and liabilities;
―	recognised as income or expense on the income statement, as income or expense in equity, or directly in equity during the period, depending on the underlying item to which it relates;
―	measured taking into account known changes in tax rates (and in tax regulations) enacted or substantively enacted at the closing date. The effect of any changes in the tax rate on deferred tax previously recognised on the income statement, as income or expense in equity, or directly in equity, is respectively recorded in the income statement, in income or expense in equity, or directly in equity during the period in which the changes in tax rate become effective.

Deferred tax assets are recognised if it is probable that taxable profits will be generated allowing the deferred tax asset to be recovered. The carrying amount of deferred tax assets is reviewed at each closing date and is reviewed where it is probable that future taxable profits will not be enough to use some or all of the deferred tax assets. Conversely, the carrying amount of deferred tax assets will be increased to the extent that it becomes probable that future taxable profits will be available on a non-temporary basis against which to charge tax losses not yet recognised.

Deferred tax assets on tax loss carryforwards have been calculated on the basis of estimates of future profits expected from entities that generated the losses. This method has been used since the 2023 budget. The time horizons of these forecasts are within the timeframes for carrying forward tax losses in each country. As an exception to this, tax losses in France may be carried forward indefinitely.

The main deferred tax assets and liabilities are netted if and only if subsidiaries have a legally enforceable right to net current assets and liabilities and where they concern income tax levied by the same tax authority.

Deferred tax is presented on the balance sheet as follows:

Analysis of deferred tax by maturity	At 31 December	At 31 December
(€ thousands)	2022	2021
Assets
More than one year	33,856	36,845
Less than 1 year	89	0
Total deferred tax assets	33,945	36,845
Liabilities
More than one year	48,024	43,546
Less than 1 year	712	0
Total deferred tax liabilities	48,737	43,546
NET DEFERRED TAX LIABILITIES	14,792	6,701

Details of deferred tax are presented as follows:

Deferred tax is presented after any netting by tax entity.

(€ thousands)	2022	2021
Employee profit sharing for the financial year	-2,059	-2,450
Lump sums paid on retirement	-4,471	-4,969
Provisions for doubtful receivables	-4,851	-4,007
Temporary differences reversing at payment	-3,424	-1,085
Tax losses recognised as assets	-12,911	-15,719
Customer relationships, brand, order book, net	38,759	40,895
Finance lease restatements	938	1,006
Regulated and other provisions	1,167	912
Revenue recognition under completed contract method vs. percentage of completion method	6,767	5,339
Temporary differences linked to depreciation and amortisation	-2,566	-8,117
IAS 19 - Employee benefits	58	-460
IAS 38 - SaaS costs	-804	-495
IFRS 3 - Business Combinations	-3,545	-1,365
IFRS 9 - Financial Instruments	7,135	335
IFRS 15 - Revenue	-2,548	-2,470
IFRS 16 - Leases	-2,823	-1,794
Other	-31	1,145
TOTAL	14,792	6,701

Deferred tax assets on tax loss carryforwards have been calculated on the basis of estimates of future profits expected from entities that generated the losses. This method has been used since the budget. The time horizons of these forecasts are within the timeframes for carrying forward tax losses. Deferred tax on tax loss carryforwards are mainly recognised at Soco 1, the head of the tax group in France, and at Socotec US.

At Soco 1, tax losses have been capitalised for the next three years on the basis of the established budgets, in an amount not exceeding 80% of the estimated tax losses used in 2023, 2024 and 2025.

The tax effect corresponding to those losses amounts to €10.3 million, after €3.3 million was derecognised with respect to 2022 (31 December 2021: €13.6 million, including €1.8 million with respect to 2021).

At 31 December 2022, cumulative non-capitalised tax loss carryforwards in France amounted to €54.6 million (31 December 2021: €53.8 million).

Other deferred tax relates mainly to retirement benefit obligations, customer relationships, brands, recognition of revenue on completion as opposed to on a progress towards completion basis, amortisation differences and provisions for doubtful receivables.

NOTE 13 - CURRENT AND NON-CURRENT

FINANCIAL ASSETS

ACCOUNTING POLICIES

INVESTMENTS IN NON-CONSOLIDATED COMPANIES

These are investments in companies over which the Group does not have control or significant influence.

IMPAIRMENT OF FINANCIAL ASSETS

Impairment of financial assets is recognised to reflect expected risks affecting all such assets as soon as it appears the Group will be unable to recover the full amount according to the original terms and conditions of the transaction.

DERIVATIVE INSTRUMENTS

These are caps, cap spreads and collars that guarantee a maximum interest rate on floating-rate debt liabilities.

(€ thousands)	At 31 December 2021	Increases	Decreases
Investments in unconsolidated subsidiaries and affiliates	11,639	27,252	-25
Equity-accounted investments	1,391	345	0
Employee benefits - Assets	0	1,261	0
Security deposits and sureties	5,877	562	-1,572
Derivative financial instruments - non-current assets	2,674	0	0
Other non-current financial assets	915	16,521	-2,558
Gross	22,496	45,941	-4,156
Investments in unconsolidated subsidiaries and affiliates	-1,008	0	0
Other non-current financial assets	-913	-23	0
Provisions	-1,921	-23	0
Net non-current financial assets	20,575	45,918	-4,156
Derivative financial instruments - current assets	0	0	0
Other current financial assets	971	0	0
Current financial assets	971	0	0

(€ thousands)	Fair value	Changes in scope of consolidation	Translation differences	Other movements	At 31 December 2022
Investments in unconsolidated subsidiaries and affiliates	0	-9,877	-1,076	0	27,913
Equity-accounted investments	0	0	-6	0	1,730
Employee benefits - Assets	0	0	-49	0	1,212
Security deposits and sureties	0	563	91	-5	5,516
Derivative financial instruments - non-current assets	26,549	0	0	0	29,223
Other non-current financial assets	0	-11,181	0	0	3,696
Gross	26,549	-20,495	-1,040	-5	69,291
Investments in unconsolidated subsidiaries and affiliates	0	-552	30	0	-1,530
Other non-current financial assets	0	-57	0	0	-992
Provisions	0	-609	30	0	-2,523
Net non-current financial assets	26,549	-21,104	-1,009	-5	66,769
Derivative financial instruments - current assets	1,236	0	0	0	1,236
Other current financial assets	0	771	-46	-336	1,359
Current financial assets	1,236	771	-46	-336	2,595

(€ thousands)	At 31 December 2020	Increases	Decreases	Fair value
Investments in unconsolidated subsidiaries and affiliates	1,726	10,455	-390	0
Equity-accounted investments	919	467	0	0
Security deposits and sureties	6,152	354	-825	0
Derivative financial instruments - non-current assets	0	1,784	0	890
Other non-current financial assets	1,067	361	-2,140	0
Gross	9,864	13,421	-3,355	890
Investments in unconsolidated subsidiaries and affiliates	-1,541	0	0	0
Other non-current financial assets	-531	-382	0	0
Provisions	-2,072	-382	0	0
Net non-current financial assets	7,793	13,039	-3,355	890
Other current financial assets	820	0	0	0
Current financial assets	820	0	0	0

(€ thousands)	Changes in scope of consolidation	Translation differences	Other movements	At 31 December 2021
Investments in unconsolidated subsidiaries and affiliates	5	38	-195	11,639
Equity-accounted investments	0	4	0	1,391
Security deposits and sureties	32	163	0	5,877
Derivative financial instruments - non-current assets	0	0	0	2,674
Other non-current financial assets	1,627	0	0	915
Gross	1,665	205	-195	22,496
Investments in unconsolidated subsidiaries and affiliates	0	-38	570	-1,008
Other non-current financial assets	0	0	0	-913
Provisions	0	-38	570	-1,921
Net non-current financial assets	1,665	168	375	20,575
Other current financial assets	0	0	151	971
Current financial assets	0	0	151	971

The increase in investments in non-consolidated companies in 2022 corresponds to the acquisitions of Quadrant and Shore for €27 million.

As regards changes in scope, there was a €10.4 negative impact from the consolidation of Urbads/Urbycom and Inpijn Blockpoel, which were acquired in December 2021 and consolidated from 1 January 2022, and a €0.6 million positive impact from investments in non-consolidated companies held by BAC in Spain (acquired in 2022).

Investments in non-consolidated companies are revalued at fair value through profit or loss at the closing date.

NOTE 14 - OTHER CURRENT AND NON-CURRENT ASSETS

(€ thousands)	At 31 December 2022	At 31 December 2021
Debit balances and debit notes on trade accounts	9,947	2,533
Advances & payments on account to suppliers	4,416	2,107
Factoring	20,578	20,292
Prepaid expenses	16,818	10,697
Tax receivables	48,985	34,815
Social security receivables	5,013	3,530
VAT receivables	42,527	29,498
Miscellaneous tax receivables	1,155	1,666
CVAE/CFE tax receivables	290	121
Other receivables	9,641	5,325
Gross	110,384	75,769
Impairment of other assets	-302	-302
Impairment of other assets	-302	-302
TOTAL TRADE AND OTHER RECEIVABLES	110,082	75,466

The "Factoring" item mainly consists of reserves related to the guarantee fund.

NOTE 15 - INVENTORIES

(€ thousands)	At 31 December 2022	At 31 December 2021
Raw materials and supplies	4,917	2,951
Other supplies	498	167
Gross	5,415	3,118
Impairment of inventories	-54	0
Impairment of inventories	-54	0
Inventories, net value	5,361	3,118

NOTE 16 - TRADE AND OTHER RECEIVABLES

ACCOUNTING POLICIES

Trade receivables are initially recognised at fair value less impairment.

Where a receivable becomes non-recoverable, it is cancelled and any related impairment is reversed. If previously cancelled receivables are recovered, the amount is credited to "Other operating income and expense" on the income statement.

Impairment is recognised on trade receivables where there is objective evidence that the Group may be unable to recover the full amount according to the original terms and conditions of the transaction. Major financial difficulties experienced by the debtor, the likelihood of the debtor going bankrupt or undergoing a financial restructuring, and failure or default in relation to a payment constitute indicators that a receivable is impaired. Doubtful receivables are analysed in view of the age of the receivable, the status of the client and whether or not there is a dispute about invoicing. The carrying amount of the asset is reduced via an impairment account, and the amount of the loss is presented in the "Depreciation, amortisation and provisions" item on the income statement.

The expected risk on trade receivables is measured on the basis of a schedule of historical default rates by maturity. Adjustments reflecting country risk or future changes in the environment may be made. The carrying amount of the asset is reduced via an impairment account, and the amount of the loss is presented in the "Depreciation, amortisation and provisions" item on the income statement.

(€ thousands)	At 31 December 2022	At 31 December 2021
Trade receivables and related accounts	193,508	163,498
Trade receivables - invoices raised	280,924	245,371
Trade receivables - factored	-87,416	-81,873
Doubtful or disputed receivables	11,636	10,544
Gross	205,144	174,042
Provisions at beginning of period	-35,712	-34,888
Additions during the period	-11,233	-16,154
Reversals during the period	11,312	12,772
Changes in scope	-5,742	-291
Translation differences and other movements	194	2,848
Provisions at end of period	-41,181	-35,712
TOTAL TRADE AND OTHER RECEIVABLES	163,963	138,330

In the Group's view, the fair value of receivables is close to their net carrying amount, since all receivables are due in less than one year.

Concentration of credit risk relating to trade receivables is low, because of the large number of clients and their international operations.

The Socotec Group has entered into a global no-recourse factoring agreement for its subsidiaries in France and the United Kingdom, in order to provide trade finance. A local factoring agreement is also in place in Italy. Receivables assigned and deconsolidated in 2022 amounted to €87.4 million as opposed to €81.8 million in 2021.

NOTE 17 - CONTRACT ASSETS AND LIABILITIES

(€ thousands)	At 31 December 2022	At 31 December 2021
Work in progress	88,595	69,365
CONTRACT ASSETS	88,595	69,365

The change during the period results from new invoicing rights that turn assets into trade receivables, and from revenue recognition generating new contract assets. Most work in progress at 1 January 2022 and 1 January 2021 was invoiced in the following 12 months.

Contract liabilities

(€ thousands)	At 31 December 2022	At 31 December 2021
Advances and payments on account received on orders	20,401	10,986
CONTRACT LIABILITIES	20,401	10,986

Contract liabilities relate to services that have not yet been provided but for which clients have paid in full.

Prepaid income mainly represents the portion of invoices raised on ongoing contracts relating to services not yet provided. The change in contract liabilities results from the conversion of prior liabilities into revenue and from new liabilities arising from services that have been invoiced but not yet provided. Most liabilities at 1 January were recognised as revenue in 2021 and 2022.

NOTE 18 - CASH AND CASH EQUIVALENTS

ACCOUNTING POLICIES

Changes in the fair value of cash and cash equivalents are recognised under net financial income/expense in "Income from cash and cash equivalents" and "Other financial income and expense".

(€ thousands)	At 31 December 2022	At 31 December 2021
Cash	107,609	157,958
Securities	220	134
CASH AND CASH EQUIVALENTS	107,829	158,092

Net cash in the consolidated cash flow statement is made up of the following items:

(€ thousands)	At 31 December 2022	At 31 December 2021
Cash and cash equivalents	107,829	158,092
Bank overdrafts	-1,328	-1,483
NET CASH ON THE CONSOLIDATED STATEMENT OF CASH FLOWS	106,501	156,609

NOTE 19 - CALLED-UP SHARE CAPITAL

Share capital

At 31 December 2022, the share capital consisted of 518,497,096 ordinary and preferred shares.

At 31 December 2021, there were 515,014,689 ordinary and preferred shares.

Treasury shares

At 31 December 2022, the Group held 171,825 of its own shares in treasury, the carrying amount of which was recorded as a deduction from equity.

NOTE 20 - SHARE-BASED PAYMENTS

ACCOUNTING POLICIES

IFRS 2 "Share-based payment" requires an entity to recognise share-based payment transactions in its financial statements, including transactions with employees or other parties to be settled in cash, other assets or equity instruments of the entity.

The fair value of services rendered by employees in exchange for bonus shares or stock options is recognised as an expense, with a balancing entry in equity if the goods or services were received as part of a share-based payment transaction settled in equity instruments, or in liabilities if the goods or services were acquired as part of a share-based payment transaction settled in cash. The total amount expensed during the vesting period is determined with reference to the fair value of the instruments granted at the grant date.

The Group has long-term remuneration plans for one category of managers, which are settled in cash or equity instruments The plans are as follows:

•	Management Incentive Package - Group;
•	Management Incentive Package - UK;
•	Management Incentive Package - US.

Management Incentive Package - Group (MIP Group)

Plan details

In December 2019, the Socotec group set up an equity-settled bonus share plan. A 5-year term was assumed for measurement purposes.

Recognition

In 2022, the Group recognised an expense of €2.2 relating to the MIP Group (2021: €3.4 million) with a balancing entry under equity.

At 31 December 2022, the liability amounted to €10.5 million (€7.4 million at end-2021).

Management Incentive Package - UK (MIP UK)

Plan details

This plan, set up in December 2019, allows managers to invest in ordinary and preferred shares. The plan is designated as cash-settled.

A 5-year term was assumed for measurement purposes.

Recognition

In 2022, the Group recognised an expense of €3.6 relating to the MIP UK (2021: €3.6 million) with a balancing entry under liabilities.

At 31 December 2022, the liability amounted to €10.5 million (€7.4 million at end-2021).

Management Incentive Package - US (MIP US)

Plan details

This plan, set up in August 2019, allows managers to invest in ordinary shares. The plan is designated as cash-settled.

A 6-year term was assumed for measurement purposes.

Recognition

In 2022, the Group recognised an expense of €3.1 relating to the MIP US (2021: €2.8 million) with a balancing entry under liabilities.

At 31 December 2022, the liability amounted to €10.5 million (€7 million at end-2021).

NOTE 21 - DIVIDEND PER SHARE

On 31 December 2022, the Company paid a dividend in shares to those entitled to receive dividends in an amount of €39.6 million with respect to 2021, corresponding to a payment of €10 per share. The same amount was paid to shareholders in 2021 with respect to 2020.

NOTE 22 - DEBT

ACCOUNTING POLICIES

Borrowings are initially recognised at fair value, net of transaction costs. Borrowings are subsequently recognised at amortised cost.

Interest on borrowings is recognised in the income statement under "Cost of gross debt" according to the effective interest-rate method. The cost of arranging borrowings is presented as a deduction from the borrowing proceeds received on the arrangement date, and amortised through the income statement over the life of the borrowings using the effective interest-rate method.

Where a business combination involving non-controlling interests is supplemented by a grant of put options to those non-controlling interests (i.e. the entity undertakes, through the put option, to buy back shares owned by non-controlling interests in one of its subsidiaries at a later date), an operating liability is recognised on the consolidated balance sheet in the amount of the estimated exercise price of the put option granted to non-controlling interests, with a balancing entry consisting of a reduction in equity. Subsequent changes in this put option related to changes in estimates or accretion are also recognised in equity. Any further buyout of non-controlling interests is regarded as a transaction between shareholders and therefore does not involve any remeasurement of identifiable assets or the recognition of any additional goodwill.

(€ thousands)	At 31 December 2021	Increases	Decreases
Term B loan	806,472	1,092	-3,209
Put-related liabilities	82,844	26,577	-11,250
Revolving credit facility	0	70,000	0
Other non-current financial liabilities	14,082	9,903	-11,649
NON-CURRENT FINANCIAL LIABILITIES	903,398	107,572	-26,109
Term B loan	0	0	0
Put-related liabilities
Revolving credit facility	0	0	0
Factoring liabilities	24,186	0	0
Other current financial liabilities	2,247	0	0
CURRENT FINANCIAL LIABILITIES	26,432	0	0
GROSS DEBT	929,830	107,572	-26,109

(€ thousands)	Fair value	Changes in scope	Translation differences	Other movements	At 31 December 2022
Term B loan	0	0	16,373	-2,785	817,943
Put-related liabilities	0	0	-686	0	97,485
Revolving credit facility	0	0	0	-70,000	0
Other non-current financial liabilities	641	14,534	3	-8,028	19,485
NON-CURRENT FINANCIAL LIABILITIES	641	14,534	15,690	-80,813	934,913
Term B loan	0	0	0	2,785	2,785
Put-related liabilities
Revolving credit facility	0	0	0	70,000	70,000
Factoring liabilities	0	0	-217	407	24,375
Other current financial liabilities	191	0	-4	7,246	9,680
CURRENT FINANCIAL LIABILITIES	191	0	-221	80,437	106,840
GROSS DEBT	832	14,534	15,469	-375	1,041,753

In June 2021, the Group refinanced its bank debt and issued a 7-year senior debt facility consisting of one €550 million tranche and one $300 million tranche.

In December 2022, the Group extended its RCF with an additional tranche of €106 million.

The Group's other borrowings from banks mainly comprise €10.9 million in factoring and loans in Italy, €6 million at Socotec Gestion and Holding Socotec, €4.8 million at BAC, €1 million at Schollenberger, €0.9 million at Ascaudit and €0.2 million at Socotec Monitoring France.

After neutralising the put liability and adjusting borrowings using the effective interest-rate method, the cash impact of the increase in debt was €61.9 million in 2022 and €56.6 million in 2021.

(€ thousands)	Total	Less than 1 year	1 to 2 years	3 to 5 years	Over 5 years
At 31 december 2022
Term B loan	817,943		10,863		807,081
Put-related liabilities	97,485	40,500	56,985
Revolving credit facility	0
Other non-current financial liabilities	19,261		18,318		943
NON-CURRENT FINANCIAL LIABILITIES	934,689	40,500	86,165	0	808,024
Term B loan	2,785	2,785
Put-related liabilities	0
Revolving credit facility	70,000	70,000
Factoring liabilities	24,375	24,375
Other current financial liabilities	9,904	9,904
CURRENT FINANCIAL LIABILITIES	107,064	107,064	0	0	0
GROSS DEBT	1,041,753	147,564	86,165	0	808,024
At 31 December 2021
Term B loan	806,472	2,649	10,330		793,493
Put-related liabilities	82,844	14,248	68,596
Revolving credit facility	0
Other non-current financial liabilities	14,082		13,318		764
NON-CURRENT FINANCIAL LIABILITIES	903,398	16,897	92,244	0	794,257
Term B loan	0
Put-related liabilities	0
Factoring liabilities	24,186	24,186
Other current financial liabilities	2,247	2,247
CURRENT FINANCIAL LIABILITIES	26,432	26,432	0	0	0
GROSS DEBT	929,830	43,329	92,244	0	794,257

Breakdown by currency

At 31 December 2022, gross debt excluding bank financing broke down by currency as follows:

Borrowing currency (€ thousands)	At 31 December 2022	At 31 December 2021
US dollar (USD)	278,509	264,941
Euro (EUR)	742,357	659,388
Pound sterling (GBP)	20,766	5,348
Other currencies	121	153
TOTAL	1,041,753	929,830

Breakdown between fixed and floating rate

At 31 December 2022, gross debt excluding bank financing broke down as follows:

(€ thousands)	At 31 December 2022	At 31 December 2021
Fixed rate	34,491	34,522
Floating rate	1,007,262	895,308
TOTAL	1,007,753	929,830

Non-IFRS financial indicator

(€ thousands)	At 31 December 2022	At 31 December 2021
Non-current financial liabilities	1,015,310	903,398
Current financial liabilities	26,443	26,432
GROSS DEBT	1,041,753	929,830
Cash and cash equivalents	-107,829	-158,092
Bank overdrafts	1,328	1,483
NET DEBT	935,252	773,221

NOTE 23 - CURRENT AND NON-CURRENT FINANCIAL LIABILITIES

(€ thousands)	At 31 December 2022	At 31 December 2021
Other non-current financial liabilities	0	0
OTHER NON-CURRENT FINANCIAL LIABILITIES	0	0
Bank overdrafts	1,328	1,483
Other current financial liabilities	391	172
OTHER CURRENT FINANCIAL LIABILITIES	1,719	1,654

NOTE 24 - LONG-TERM EMPLOYEE

BENEFITS

ACCOUNTING POLICIES

POST-EMPLOYMENT BENEFITS

According to the laws and customs of the countries in which the Group operates, Socotec takes part in employee benefit plans under which staff members and pensioners are paid pensions, post-employment medical benefits and other post-employment benefits including severance payments.

Defined-contribution plans

For defined-contribution plans, the Group recognises contributions to be paid as expenses when they fall due, since it has no liability beyond paying the contributions.

Defined-benefit plans

In accordance with IAS 19 revised "Employee benefits", for defined-benefit plans, pension costs are determined by independent actuaries based on the projected unit credit method. This method sees each period of service as giving rise to an additional unit of benefit entitlement and measures each unit separately to obtain the final obligation.

The final obligation is then discounted to present value. These calculations mainly take into account the following assumptions:

•	a discount rate;
•	an inflation rate;
•	a rate of salary increase;
•	a staff turnover rate;
•	a mortality table;
•	age at retirement.

These calculations are carried out every year for all plans.

In certain countries, external funds are necessary to meet pension liabilities. Financial assets may exceed estimated liabilities, in which case a financial asset is recognised on the balance sheet. However, recognition of that asset is limited to the present value of any economic benefits available in the form of all future refunds from the plan or all reductions in future contributions to the plan. To calculate the present value of the economic benefits, all applicable minimum funding requirements are taken into account.

Certain other post-employment benefits such as medical cover are also covered by provisions, which are measured by carrying out an actuarial calculation similar to that carried out for pension provisions.

The impact of remeasuring net liabilities with respect to defined-benefit plans, which includes actuarial gains and losses, the return on plan assets (excluding interest) and any asset capping effect (excluding interest), is immediately recognised under other comprehensive income (OCI). The Group determines net interest expense (income) on net defined-benefit liabilities (assets) for the period by applying the discount rate used to measure the defined-benefit obligation at the start of the year in net defined-benefit liabilities (assets), taking into account all changes in net defined-benefit liabilities (assets) during the period as a result of contributions and benefit payments. Net interest expense and other expense related to defined-benefit plans are recognised in the income statement.

Where plan benefits change or a plan is curtailed, the resulting change in benefit related to past service or the curtailment income/loss is immediately recognised in the income statement. The Group recognises gains and losses relating to the settlement of a defined-benefit plan at the time the settlement occurs.

OTHER LONG-TERM BENEFITS

In some countries, the Group makes payments to reward staff members for long service in the form of bonuses. The Group's net obligation regarding these other long-term staff benefits corresponds to the amount of future benefits vested in staff members in exchange for their service during the current period and previous periods. The benefit is discounted to present value. Remeasurement effects are recognised in the income statement during the corresponding period.

Defined-benefit plans

Staff benefits consist of pension plans and correspond to termination benefits defined by agreements in force. Part of the pension plans is funded through contributions paid to insurance companies and measured on the basis of periodic actuarial calculations.

Changes in obligations and plan assets in the last two years are as follows:

(€ thousands)	Total
	2022	2021
Obligation at beginning of period	-70,428	-72,323
Service cost	-3,539	-3,344
Benefits paid out	2,673	2,701
Financial cost	-969	-663
Actuarial losses/(gains)	11,821	3,419
Business combination and other movements	-184	-14
Plan curtailment	590	1,797
Plan adjustment	2	724
Translation difference	1,782	-2,725
OBLIGATION AT END OF PERIOD	-58,251	-70,428
Plan assets at beginning of period	48,648	44,083
Benefits paid out	-2,275	-2,741
Financial income	709	471
Actuarial (losses)/gains	-4,649	3,995
Implied return on plan assets	90	39
Employer contributions	557	561
Expenses paid	-139	-154
Other movements	30	35
Translation difference	-1,831	2,360
PLAN ASSETS AT END OF PERIOD	41,140	48,648
DEFICIT/SURPLUS	-17,111	-21,780

(€ thousands)	France		Italy
	2022	2021	2022	2021
Obligation at beginning of period	-27,556	-30,561	-1,747	-1,410
Service cost	-2,076	-2,141	-646	-451
Benefits paid out	1,190	1,092	171	169
Financial cost	-236	-95	0	0
Actuarial losses/(gains)	4,884	1,639	-164	-57
Business combination and other movements	-162	-8	-16
Plan curtailment	590	1,797
Plan adjustment	-7	721	9	2
Translation difference
OBLIGATION AT END OF PERIOD	-23,373	-27,556	-2,392	-1,747
Plan assets at beginning of period	10,331	11,405
Benefits paid out	-963	-1,301
Financial income
Actuarial (losses)/gains	-90	188
Implied return on plan assets	90	39
Employer contributions
Expenses paid
Other movements
Translation difference
PLAN ASSETS AT END OF PERIOD	9,368	10,331
DEFICIT/SURPLUS	-14,005	-17,225	-2,392	-1,747

(€ thousands)	UK		Other
	2022	2021	2022	2021
Obligation at beginning of period	-39,759	-39,483	-1,366	-869
Service cost	-278	-279	-539	-472
Benefits paid out	1,312	1,440
Financial cost	-733	-568
Actuarial losses/(gains)	7,100	1,837
Business combination and other movements	-6	-6
Plan curtailment
Plan adjustment
Translation difference	1,803	-2,701	-21	-24
OBLIGATION AT END OF PERIOD	-30,560	-39,759	-1,927	-1,366
Plan assets at beginning of period	38,317	32,677
Benefits paid out	-1,312	-1,440
Financial income	709	471
Actuarial (losses)/gains	-4,559	3,807
Implied return on plan assets	0	0
Employer contributions	557	561
Expenses paid	-139	-154
Other movements	30	35
Translation difference	-1,831	2,360
PLAN ASSETS AT END OF PERIOD	31,772	38,317
DEFICIT/SURPLUS	1,212	-1,442	-1,927	-1,366

Net changes in the last two years are as follows:

(€ thousands)	2022	2021
Net obligation at beginning of period	-21,780	-28,240
2022 pension expense	-3,256	-1,131
Benefits paid out	399	-41
Actuarial losses/(gains)	7,173	7,415
Business combination and other movements	403	582
Translation difference	-49	-366
NET OBLIGATION AT END OF PERIOD	-17,111	-21,780

Changes in staff benefits recognised in the income statement and in other comprehensive income are as follows:

(€ thousands)	2022	2021
Service cost	-3,678	-3,498
Financial cost	-260	-192
Implied return on plan assets	90	39
Plan curtailment	590	1,797
Plan adjustment	2	724
2022 PENSION EXPENSE	-3,256	-1,131

(€ thousands)	2022	2021
Opening OCI: Actuarial losses/(gains)	7,409	0
Actuarial losses during the period	7,173	7,415
Other	2	-5
Closing OCI: Actuarial losses/(gains)	14,584	7,409

(€ thousands)	2022	2021
Actuarial losses/(gains) due to experience	-816	521
Change in assumptions	12,637	2,898
Actuarial losses/(gains) due to the return on plan assets	-4,649	3,995
TOTAL ACTUARIAL (GAINS)/LOSSES	7,173	7,415

For retirement benefit obligations in France, the main actuarial assumptions used are as follows:

	At 31 December 2022	At 31 December 2021
Discount rate	3.70%	0.87%
Based on AA-rated eurozone corporate bond yields	IBOXX yield	IBOXX yield
Salary increase rate	2.50%	1.50%
Mortality rates: women	TPGF05	TPGF05
Mortality rates: men	TPGH05	TPGH05

A 0.5-point reduction in the discount rate in France would increase the provision for Group staff benefits by 5.14%.

A 0.5-point increase in the discount rate in France would reduce the provision for Group staff benefits by 4.75%.

For retirement benefit obligations in the UK, the main actuarial assumptions used are as follows:

	At 31 December 2022	At 31 December 2021
Discount rate	4.80%	1.90%
Basis	Isio Core AA Yield	Isio Core AA Yield
	Curve, 15 years	Curve, 15 years
Salary increase rate	2.05%	2.20%

Defined-contribution plans

Some defined-contribution pension plans exist within the Group but are not regarded as material.

NOTE 25 - CONTINGENCY AND LOSS PROVISIONS

ACCOUNTING POLICIES

Provisions are recognised in accordance with IAS 37 "Provisions, contingent liabilities and contingent assets" where the Group, at the balance-sheet date, has a legal, contractual or implied obligation to a third party resulting from a past event, where it is likely that an outflow of resources embodying economic benefits will be required to settle the obligation and where the amount of that obligation can be reliably estimated. These provisions are estimated using the most likely assumptions at the time the financial statements are prepared.

In the event that a contract with a customer is expected to generate losses, contingency and loss provisions are set aside for the whole contract.

Changes in provisions for contract disputes and other contingency and loss provisions are as follows:

(€ thousands)	At 31 December 2021	Additions	Reversed used
Technical risk provisions	27,869	3,689	-5,256
Provisions for other risks	6,648	1,966	-712
Provisions for employee disputes	8,245	2,874	-2,254
Provisions for losses on completion and tax disputes	1,054	118	-39
TOTAL PROVISIONS	43,816	8,647	-8,261

(€ thousands)	Reversed unused	Changes in scope	Translation differences and other movements	At 31 December 2022
Technical risk provisions	-544	23	-57	25,723
Provisions for other risks	0	0	160	8,063
Provisions for employee disputes	-124	136	-2	8,876
Provisions for losses on completion and tax disputes	0	10	-248	895
TOTAL PROVISIONS	-668	169	-148	43,556

Technical risk provisions

Technical risk provisions at 31 December 2022 amounted to €24.4 million for France, of which €22.6 million related to Socotec Construction.

Provisions for other contingencies

Provisions for other contingencies include provisions for the restoration of premises for €1.8 million in France and €1.4 million in the UK, as well as provisions for vehicle-related claims for €0.7 million.

Provisions for employee disputes

Employee-related contingency provisions mainly relate to France for €5.4 million.

Provisions pour perte a terminaison et litiges fiscaux

Provisions for losses on completion amounted to €0.6 million and provisions for tax disputes amounted to €0.2 million at 31 December 2022.

NOTE 26 - OTHER CURRENT LIABILITIES

At 31 December 2022, the "Deferred payments on acquisitions" item mainly corresponded to obligations to make earn-out payments relating to acquisitions, and particularly €26.2 million of liabilities relating to acquisitions in 2022.

(€ thousands)	At 31 December 2022	At 31 December 2021
Deferred payments for acquisitions	29,096	11,096
Other miscellaneous financial liabilities	11,927	11,417
Accrued expenses	10,928	9,152
OTHER CURRENT LIABILITIES	51,951	31,665

NOTE 27 - TRADE AND OTHER PAYABLES

ACCOUNTING POLICIES

TRADE PAYABLES

Trade payables are initially recognised at fair value. All trade payables are classified under current liabilities on the balance sheet with a maturity of less than one year.

Details regarding changes in trade and other payables are as follows:

(€ thousands)	At 31 December 2022	At 31 December 2021
Employee-related liabilities	150,031	126,526
Employee profit sharing	7,013	8,387
Liabilities to employees	47,633	40,494
Social security organisations	45,100	38,262
Bonuses (including social security expenses)	22,758	18,830
Bonuses (earnout)	6,501	6,154
Share-based payment (cash)	21,026	14,399
Trade payables and related accounts	88,613	67,347
Tax liabilities	86,732	74,041
VAT liabilities	79,483	65,500
CVAE/CFE	6,493	7,400
Other	756	1,141
Credit balances and credit notes on trade accounts	21,090	18,328
Other trade and other payables	2,275	682
TOTAL TRADE AND OTHER PAYABLES	348,741	286,924

NOTE 28 - SEGMENT REPORTING

ACCOUNTING POLICIES

SEGMENT REPORTING

Under IFRS 8 "Operating segments", the Group reports on operating segments, products and services, geographical areas in which the Group operates and its main customers. Segment information, including the identification of operating segments, corresponds to the information included in internal management reports.

Group Management analyses and measures business performance in the geographical areas in which the Group operates.

The Group's operating segments are defined as one geographical area (e.g. France) or several geographical areas combined (International/Other countries).

The analysis of revenue and operating income by segment is as follows:

	Revenue		Operating income
(€ thousands)	2022	2021	2022	2021
France	559,394	532,108	38,646	21,477
United Kingdom	171,480	162,458	2,009	1,307
Germany	131,037	112,613	26,625	26,693
United States	126,280	105,891	17,375	18,597
Italy	65,414	37,291	11,884	6,842
Netherlands	33,150	5,108	2,329	797
Spain	25,617	0	929	0
International/Other countries	44,228	42,258	506	147
TOTAL	1,156,599	997,727	100,304	75,861

NOTE 29 - INFORMATION ON FINANCIAL INSTRUMENTS

ACCOUNTING POLICIES

Financial instruments consist of:

•	financial assets, which include other non-current assets, trade receivables, other current assets, cash management assets, and cash and cash equivalents; financial liabilities, which include short- and long-term debts and bank overdrafts,
•	current and non-current lease liabilities, operating liabilities and other current and non-current liabilities; derivative instruments.

CLASSIFICATION OF FINANCIAL INSTRUMENTS

Financial instruments (assets and liabilities) are recognised in the consolidated statement of financial position at their initial fair value. Provisions in IFRS 9 "Financial instruments" regarding the classification and measurement of financial assets are based on the Group's management method and the contractual characteristics of the financial assets. Depending on their category, financial assets and liabilities are subsequently measured at fair value through profit or loss, fair value through other comprehensive income, or amortised cost. Financial liabilities are classified as being measured at amortised cost or at fair value through profit or loss if they are held for trading. Amortised cost corresponds to the initial carrying amount (net of transaction costs) plus interest calculated using the effective interest rate and minus cash outflows (coupons, repayments of principal and any redemption premiums). Accrued interest (income and expense) is recognised using not the financial instrument's nominal interest rate but its effective interest rate. Expected credit losses are recorded on financial assets measured at amortised cost. Any impairment loss is recognised in the income statement.

A financial instrument's fair value is the amount for which an asset could be exchanged or a liability settled between well informed, consenting parties in an arm's-length transaction.

DERIVATIVE INSTRUMENTS

Derivative instruments consist of caps, cap spreads and collars that provide protection against increases in interest rates on the Group's debt above certain levels.

Under IFRSs, a derivative instrument meets the definition of a financial asset or liability (IFRS 9.A and .IG B.2).

Accordingly, it must be recognised on the balance sheet like any other financial asset or liability (IFRS 9.5.1.1) and no off-balance sheet treatment is possible.

The aim of hedge accounting is to reflect in the financial statements the impact of risk management carried out by an entity using financial instruments to hedge against specific risks that affect the income statement (or OCI in the case of equity instruments recognised at fair value through OCI) (IFRS 9.6.1.1).

ESTIMATE OF FAIR VALUE

Fair value measurements relating to financial and non-financial assets and liabilities are carried out according to three levels:

•	Level 1: fair value measured on the basis of observed (unadjusted) prices in active markets for identical assets or liabilities;
•	Level 2: fair value measured on the basis of data other than quoted prices in active markets, i.e. data that are directly observable (prices) or indirectly observable (data derived from prices);
•	Level 3: fair value measured with the help of data that are not based on observable market data (non-observable data).

For each category of financial instruments according to IFRS 9, the table below shows carrying amounts, their breakdown by measurement method and their fair value at each closing date:

		Carrying amount
(€ thousands)	Balance	Hedge accounting
AT 31 DECEMBER 2022
Financial assets	523,571
Securities in non-consolidated companies	27,913
Derivative financial instruments - non-current assets	29,223	29,223
Other non-current financial assets	9,632
Other non-current assets	0
Trade receivables	235,526
Other current financial assets	1,359
Derivative financial instruments - current assets	1,236	1,236
Other current assets	110,853
Cash and cash equivalents	107,829
Financial liabilities	1,573,634
Non-current financial liabilities	934,047
Derivative financial instruments - non-current liabilities	641	641
Non-current lease liabilities	79,420
Other non-current financial liabilities	0
Trade and other payables	348,741
Current financial liabilities	106,873
Derivative financial instruments - current liabilities	191	191
Current lease liabilities	34,930
Other current financial liabilities	1,719
Other current liabilities	67,071
AT 31 DECEMBER 2021
Financial assets	451,437
Securities in non-consolidated companies	11,639
Derivative financial instruments - non-current assets	2,674	2,674
Other non-current financial assets	6,262
Other non-current assets	0
Trade receivables	196,332
Other current financial assets	971
Other current assets	75,468
Cash and cash equivalents	158,092
Financial liabilities	1,354,681
Non-current financial liabilities	903,398
Non-current lease liabilities	66,086
Other non-current financial liabilities	0
Trade and other payables	286,924
Current financial liabilities	26,432
Current lease liabilities	30,838
Other current financial liabilities	1,654
Other current liabilities	39,349

	Carrying amount
(€ thousands)	Amortised cost	Fair value through equity	Fair value through profit or loss
AT 31 DECEMBER 2022
Financial assets
Securities in non-consolidated companies		27,913
Derivative financial instruments - non-current assets
Other non-current financial assets	9,632
Other non-current assets
Trade receivables	235,526
Other current financial assets	1,359
Derivative financial instruments - current assets
Other current assets	110,853
Cash and cash equivalents			107,829
Financial liabilities
Non-current financial liabilities	934,047
Derivative financial instruments - non-current liabilities
Non-current lease liabilities	79,420
Other non-current financial liabilities	0
Trade and other payables	348,741
Current financial liabilities	106,873
Derivative financial instruments - current liabilities
Current lease liabilities	34,930
Other current financial liabilities	1,719
Other current liabilities	67,071
AT 31 DECEMBER 2021
Financial assets
Securities in non-consolidated companies		11,639
Derivative financial instruments - non-current assets
Other non-current financial assets	6,262
Other non-current assets	0
Trade receivables	196,332
Other current financial assets	971
Other current assets	75,468
Cash and cash equivalents			158,092
Financial liabilities
Non-current financial liabilities	903,398
Non-current lease liabilities	66,086
Other non-current financial liabilities	0
Trade and other payables	286,924
Current financial liabilities	26,432
Current lease liabilities	30,838
Other current financial liabilities	1,654
Other current liabilities	39,349

	Fair value
(€ thousands)	Level 1	Level 2	Level 3
AT 31 DECEMBER 2022
Financial assets
Securities in non-consolidated companies			27,913
Derivative financial instruments - non-current assets		29,223
Other non-current financial assets
Other non-current assets
Trade receivables
Other current financial assets
Derivative financial instruments - current assets		1,236
Other current assets
Cash and cash equivalents	107,829
Financial liabilities
Non-current financial liabilities
Derivative financial instruments - non-current liabilities		641
Non-current lease liabilities
Other non-current financial liabilities
Trade and other payables
Current financial liabilities
Derivative financial instruments - current liabilities		191
Current lease liabilities
Other current financial liabilities
Other current liabilities
AT 31 DECEMBER 2021
Financial assets
Securities in non-consolidated companies			11,639
Derivative financial instruments - non-current assets		2,674
Other non-current financial assets
Other non-current assets
Trade receivables
Other current financial assets
Other current assets
Cash and cash equivalents	158,092
Financial liabilities
Non-current financial liabilities
Non-current lease liabilities
Other non-current financial liabilities
Trade and other payables
Current financial liabilities
Current lease liabilities
Other current financial liabilities
Other current liabilities

Derivative financial instruments are cash flow hedging instruments, measured with a balancing entry under other comprehensive income.

These instruments are regarded as effective within the meaning of IFRS 7(21) and following.

The impact on OCI amounted to €18.2 million net of deferred tax.

NOTE 30 - FINANCIAL RISK MANAGEMENT

Interest-rate risk

Because of the existence of certain floating-rate loans and credit facilities, the Group's debt servicing costs are exposed to fluctuations in interest rates. The floating-rate benchmark rate is Euribor for euro-denominated loans and SOFR for dollar-denominated loans. At 31 August 2022, floating-rate debt made up 96.7% of total debt.

To hedge against interest-rate movements, the Group has arranged caps, cap spreads and collars that provide protection against increases in interest rates on the Group's debt above certain levels.

Credit risk

Credit risk is the risk that the Group will suffer a financial loss if a customer breaches its contractual obligations. That risk relates mainly to trade receivables.

The carrying amount of financial assets represents the Group's maximum exposure to credit risk. The Group monitors its credit risk by applying a suitable credit management policy.

At 31 December 2022, the Group's maximum exposure to credit risk was as follows:

(€ thousands)	At 31 December 2022
Trade receivables and related accounts	265,071
of which
• provisioned	-41,181
• non-provisioned and past due:	89,339
for less than one month	38,717
for between 1 and 3 months	20,378
for between 3 and 6 months	10,035
for more than 6 months	20,209

Liquidity risk

The Group must have sufficient medium- and long-term liquidity to honour its financial obligations at all times.

If future cash flows are insufficient, the Group may consider:

•	reducing or delaying investments;
•	selling assets;
•	obtaining new funding;
•	issuing additional equity instruments.

The Group has a revolving credit facility to cover liquidity risk. The undrawn amount on that facility was €156 million at 31 December 2022.

Counterparty risk

Counterparty risk is the risk that the Group will suffer a financial loss if a counterparty to a financial instrument breaches its contractual obligations. The Company regularly assesses the probability of such a risk materialising and monitors the solvency of each counterparty to determine whether the risk of a breach remains low.

Exchange-rate risk

The Group's cash flows have little exposure to exchange-rate risk. Sales and purchases are in the functional currencies of Group entities. Business operations and cash flows are managed by local platforms.

NOTE 31 - HEADCOUNT

	2022
	Managerial	Non-managerial	Total
Operations France	2,038	2,565	4,603
International Operations, Infrastructure	274	2,841	3,115
Belux	15	109	724
Germany	17	911	928
Italy	18	685	703
MEA & Infrastructure	59	190	249
Certification	18	160	178
Overseas France	54	87	141
Monitoring	72	60	133
Netherlands	21	259	280
Spain	0	377	377
Operations UK	122	1,590	1,712
Operations US	142	272	414
Holding company	208	85	292
TOTAL AVERAGE HEADCOUNT	2,783	7,353	10,136

	2021
	Managerial	Non-managerial	Total
Operations France	1,901	2,516	4,417
International Operations, Infrastructure	255	1,993	2,248
Belux	16	107	123
Germany	20	817	837
Italy	11	547	558
MEA & Infrastructure	58	190	248
Certification	11	163	774
Overseas France	56	85	141
Monitoring	79	49	128
Netherlands	5	36	40
Spain	0	0	0
Operations UK	128	1,706	1,834
Operations US	99	294	393
Holding company	176	88	263
TOTAL AVERAGE HEADCOUNT	2,559	6,597	9,156

	Change
	Managerial	Non-managerial	Total
Operations France	137	49	185
International Operations, Infrastructure	18	848	866
Belux	-1	2	1
Germany	-3	94	91
Italy	7	138	145
MEA & Infrastructure	0	1	1
Certification	7	-2	4
Overseas France	-2	2	0
Monitoring	-6	11	5
Netherlands	16	223	240
Spain	0	377	377
Operations UK	-6	-116	-122
Operations US	43	-22	21
Holding company	32	-3	29
TOTAL AVERAGE HEADCOUNT	223	756	980

NOTE 32 - OFF-BALANCE SHEET COMMITMENTS AND PLEDGES

OFF-BALANCE SHEET COMMITMENTS RELATING TO THE GROUP'S FINANCING

Conventions:

Under the new borrowings arranged in June 2021, Holding Socotec also became a party to the Senior Facilities Agreement and undertook to comply with subsequent commitments, including a security package in which assets including money in bank accounts, securities and receivables of various Group companies are pledged.

Pledged money in bank accounts amounted to €40.7 million at 31 December 2022.

OFF-BALANCE SHEET COMMITMENTS RELATING TO THE GROUP'S FINANCING

Endorsements, sureties, guarantees given and collateral pledged:

Endorsements, sureties and guarantees given by the Group totalled €22.7 million, of which €10.7 million in France, €6.7 million in Italy, €3.9 million in Germany and €1.3 million in Morocco.

Collateral pledged:

The total amount of collateral pledged by the Group was €1.8 million, comprising €1.0 million in France and €0.8 million in the Netherlands.

First-demand guarantee for the benefit of Arval Service Lease:

Holding Socotec SAS has granted a stand-alone first-demand guarantee to Arval Service Lease as security for certain Socotec group entities. Holding Socotec SAS has provided a guarantee regarding the performance of all obligations under the agreement, including lease payments, termination compensation, commissions, penalties, interest, fees and incidental expenses. Holding Socotec SAS has undertaken to pay all sums up to a limit of €11.1 million.

NOTE 33 - RELATED-PARTY TRANSACTIONS

None.

NOTE 34 - EXECUTIVE REMUNERATION

Information on the remuneration of management bodies is intentionally not provided because this would indirectly result in the disclosure of individual remuneration packages.

NOTE 35 - STATUTORY AUDITORS' FEES

In 2022, the following expenses were recognised in the Group's income statement:

	2022
(€ thousands)	Mazars	Grant Thornton	PWC
Statutory audit, certification, examination of individual and consolidated financial statements	534	709	8
Services other than certification of the financial statements	12	78	0
TOTAL	547	787	8

	2022
(€ thousands)	SCOREX	Other auditors	Total
Statutory audit, certification, examination of individual and consolidated financial statements	5	214	1,470
Services other than certification of the financial statements	0	38	129
TOTAL	5	252	1,598

	2021
(€ thousands)	Mazars	Grant Thornton	PWC
Statutory audit, certification, examination of individual and consolidated financial statements	373	536	8
Services other than certification of the financial statements	0	0	0
TOTAL	373	536	8

	2021
(€ thousands)	Scorex	Other auditors	Total
Statutory audit, certification, examination of individual and consolidated financial statements	5	168	1,090
Services other than certification of the financial statements	0	0	0
TOTAL	5	168	1,090

NOTE 36 - POST-BALANCE SHEET EVENTS

Since the beginning of 2023, the Group has made five additional acquisitions:

In Germany:

•	In February 2023, architect's office Hohlich & Schmotz joined the Group, enabling Canzler to double its architecture capability and to expand its positions in Germany with two additional sites (Burgdorf and Mainz);
•	The acquisition of Marx Ingenieure in February 2023 and Erdmann Brandmann in March 2023 by ZPP Ingenieure brought in engineering and industrial construction skills.

In France:

•	Acquisition of Alpha Formation, specialising in certified CACES training, by Socotec Formation in April 2023.

In the United States:

•	Acquisition of Spinnaker by Socotec US in April 2023. This Florida-based company strengthens the Group's sustainable construction consultancy business.

NOTE 37 - SCOPE OF CONSOLIDATION

				2022	2021
Company code	Company	Head office	Consolidation method	% interest	% interest
4SC	4see Consulting (UAE)	United Arab Emirates	FC	49.0	49.0
4SE	4SEE	United Kingdom	FC	98.5	98.7
ABU	Socotec Inter Abu Dhabi Branch	United Arab Emirates	FC	49.0	100.0
AFR	Socotec Africa	Côte d'Ivoire	FC	100.0	100.0
AHI	Socotec AirBTP	France	FC	100.0	100.0
AJE	AJA UK	United Kingdom	FC	100.0	100.0
AJH	Socotec Certification Hong Kong	China	FC	100.0	100.0
AJP	Socotec Certification Philippines	Philippines	FC	40.0	40.0
AJT	Socotec Certification Thailand	Thailand	FC	74.4	74.4
AJU	Socotec Certification USA	United States	FC	100.0	100.0
AJX	Socotec Certification Training	Thailand	FC	49.0	49.0
ALD	Socotec Asbestos Limited	United Kingdom	FC	98.5	98.7
ANT	Socotec Antilles-Guyane	France	FC	100.0	100.0
ARH	ArchEng Holding Company	United States	FC	94.7	91.4
ASB	Socotec ASBL	Luxembourg	FC	100.0	100.0
ASC	Ascaudit SAS	France	FC	100.0
ASE	Ascaudit Energie et Fluides SAS	France	FC	100.0
ASG	Ascaudit Groupe SAS	France	FC	100.0
ASH	Ascaudit Holding SAS	France	FC	100.0
ASM	Ascaudit Mobilité SAS	France	FC	100.0
ASK	Schollenberger Kampfmittelbergung GmbH Austria	Austria	FC	77.3	77.3
AXE	AXE Maroc	Morocco	FC	99.9	99.9
AXF	AXE France	France	FC	100.0	100.0
BAC	Bac Engineering Consultancy Group, S.L.	Espagne	FC	91.8
BAG	Bac Group S.A.S. (Colombia)	Colombia	FC	91.8
BAR	Socotec Gulf	Bahrain	FC	100.0	100.0
BBA	SCI Bouloi Bas	France	FC	100.0	100.0
BCI	Buckingham InvestFCation	United Kingdom	FC	98.5	98.7
BEC	BAC Engineering Consultancy Group Sucursal Colombia	Colombie	FC	91.8
BEG	Bac Engineering Consultancy Group S.A.S. (Colombia)	Colombie	FC	91.8
BER	Energia y Recursos Hidraulicos Consultoria Technica S.L.	Espagne	FC	63.3
BGQ	Socotec Belgium SPRL	Belgium	FC	100.0	100.0
BHA	SCI Bouloi Haut	France	FC	100.0	100.0
BIC	Iciasa Control e Inspeccion S.L	Espagne	FC	91.8
BIM	BIM In Motion	France	FC	100.0	100.0
BML	Base Midlands Limited	United Kingdom	FC	69.0
BQI	Base Quantum Ireland Limited	Irelande	FC	69.0
BSQ	Socotec Advisory Limited	United Kingdom	FC	69.0
BVG	Bac I Ventayol Geoserveis S.L	Espagne	FC	91.8
BVQ	Vea Qualitas S.L.	Espagne	FC	91.8
BYA	Socotec Building Control	United Kingdom	FC	98.5	98.7
BYC	Butler & Young Consultants Limited	United Kingdom	FC	98.5	98.7
BYG	Butler & Young Group Limited	United Kingdom	FC	98.5	98.7
BYH	Butler & Young Holdings Limited	United Kingdom	FC	98.5	98.7
BYT	Trenton Fire Limited	United Kingdom	FC	98.5	98.7
C1L	ESG Capital 1 Limited	United Kingdom	FC	98.5	100.0
C2G	C2G International LLC	United States	FC	94.7	91.4
C2L	ESG Capital 2 Limited	United Kingdom	FC	98.5	98.7
CAL	Socotec Calédonie	New Caledonia	FC	100.0	100.0
CAS	Société de Développement BTP Maroc	Morocco	FC	100.0	100.0
CBI	CBI Consulting LLC	United States	FC	94.7	91.4
CCS	CIS Certification PTE	Singapore	FC	95.0	95.0
CEN	Socotec Civil Engineering	France	FC	100.0	100.0
CIA	Contrôle Industriel Beige SA	Belgium	FC	100.0	100.0
CIB	Socotec Belgium ASBL	Belgium	FC	100.0	100.0
CID	Canzler GmbH	Germany	FC	69.2	69.2
CIH_EM	Certification International Holdings INC	Philippines	EM	39.9	39.9
CIJ	Socotec Certification Japan	Japan	FC	50.1	50.1
CIL	Certification International Limited	United Kingdom	FC	100.0	100.0
CIP-EM	Certification International Philippines INC	Philippines	EM	63.8	63.8
CIS	Socotec Certification Singapore	Singapore	FC	95.0	95.0
CMF	Cementys France	France	FC	99.5	66.5
CMG	Geotys	France	FC	99.5	66.5
CMS	SensOptix	France	FC	99.5	66.5
CMV	Cementys Vietnam	Vietnam	FC	99.5	66.5
CPA	CPAG	United States	FC	94.7	91.4
CSP	Socotec CSPS Consulting	France	FC	100.0
CUK	Socotec Certification UK	United Kingdom	FC	100.0	100.0
DEV	Socotec Developpement	France	FC	100.0	100.0
DGF	GeoFact GmbH	Germany	FC	77.3	77.3
DHS	Socotec Deutschland Holding	Germany	FC	98.8	98.8
DPA	David Pattillo & Associates	Etats-Unis	FC	94.7	91.4
DSK	Schollenberger Kampfmittelbergung GmbH	Germany	FC	77.3	77.3
DTS	Socotec Testing GmbH	Germany	FC	77.3	77.3
DUB	Socotec Inter Dubai Branch	United Arab Emirates	FC	100.0	100.0
E2C	Socotec Expertise	France	FC	100.0	100.0
EHG	Socotec Diagnostic Groupe	France	FC	100.0	100.0
EHI	Socotec Diagnostic	France	FC	100.0	100.0
EIL	ESG Investments Limited	United Kingdom	FC	98.5	98.7
GSL	Geotech Specialists Limited Ireland	Irelande	FC	98.5	98.7
GTI	Gestion Technique Infomatique Immobiliere «GT2I» SAS	France	FC	100.0
HLD	Holding Socotec	France	FC	100.0	100.0
HSG	Holding Socotec (South East Asia) PTE Ltd	Singapore	FC	100.0
HUB	HuberLischka Architekten GmbH	Germany	FC	69.2	69.2
HWL	Henley Water Limited	United Kingdom	FC	98.5	98.7
IBA	IBA Holdings LLC	United States	FC	94.7	91.4
IEV	Inspicio Environmental	United Kingdom	FC	98.5	98.7
IHL	Inspicio Holdings Ltd	United Kingdom	FC	98.5	98.7
IMG	IMG	Italy	FC	85.0
IMP	IMG Monitoring Poland	Pologne	FC	85.0
INF	Socotec Infrastructure	France	FC	100.0	100.0
INT	Socotec International	France	FC	100.0	100.0
ISS	Sestosensor	Italy	FC	85.0
ITA	ITAL SOCOTEC	Italy	EM	40.0	40.0
ITB	Socotec Italia SRL	Italy	FC	85.0	85.0
ITC	Constructionfit Monitoring Limited	United Kingdom	FC	98.5	98.7
ITG	Eurogeo	Italy	FC	85.0
ITH	Socotec Italia Holding	Italy	FC	85.0	85.0
ITI	Calyx Investments Limited	United Kingdom	FC	98.5	98.7
ITM	Socotec Monitoring UK Limited	United Kingdom	FC	98.5	98.7
ITT	Tecnolab	Italy	FC	85.0	85.0
LAB	Socotec Power Services	France	FC	100.0	100.0
LIB	Socotec Liban	Lebanon	FC	90.0	90.0
LIS	Socotec Liban Succursale Arabie Saoudite	Arabie Saoudite	FC	90.0
LPE	LPI Engineering Inc	United States	FC	94.7	91.4
LPI	LPI Inc	United States	FC	94.7	91.4
LUX	Socotec Luxembourg SARL	Luxembourg	FC	100.0	100.0
MA2	Socotec Madagascar	Madagascar	FC	100.0	100.0
MAI	Socotec Infrastructure Maroc	Morocco	FC	100.0	100.0
MAR	Socotec Maroc	Morocco	FC	99.9	99.9
MON	Socotec Monaco	Monaco	FC	97.0	96.0
MTS	Socotec MTS Ltd. (Mauritius)	Mauritius	FC	100.0	100.0
NBB	New Blue BV	Netherlands	FC	100.0
NBS	Blue Star BV	Netherlands	FC	100.0
NCA	CAG Amned BV	Netherlands	FC	100.0
NCB	Buis-IT BV	Netherlands	FC	100.0
NCC	CAG GmbH	Germany	FC	100.0
NCG	CAG Amned Group BV	Netherlands	FC	100.0
NCH	Het Inspectiehuis - Het Energiehuis BV	Netherlands	FC	100.0
NCI	Invent Advies BV	Netherlands	FC	100.0
NCL	IQ-Laboratory BV	Netherlands	FC	100.0
NCS	CAG Services BV	Netherlands	FC	100.0
NCT	Tandrup Water Solutions Nederland BV	Netherlands	FC	75.0
NCW	Woning Advies Nederland BV	Netherlands	FC	100.0
NDT	CIS Controle Supervision Inspection	France	FC	100.0	100.0
NHE	Hanselman Expertise BV	Netherlands	FC	100.0	100.0
NHH	Hanselman Holding BV	Netherlands	FC	100.0	100.0
NHG	Hanselman Groep BV	Netherlands	FC	100.0	100.0
NHL	E&F Leasing BV	Netherlands	FC	100.0	100.0
NHP	ProScan BV	Netherlands	FC	100.0	100.0
NHT	Salvage Transport Incidents BV	Netherlands	FC	100.0	100.0
NIE	IB Engineers BV	Netherlands	FC	70.0
NFC	Sonar Geothechniek BV	Netherlands	FC	70.0
NIM	Inpijn Blokpoel Milieu BV	Netherlands	FC	70.0
NIS	Songoed BV	Netherlands	FC	70.0
NIW	Inpijn Blokpoel West BV	Netherlands	FC	70.0
NIZ	Inpijn Blokpoel Zuid BV	Netherlands	FC	70.0
NSH	Socotec Netherlands BV	Netherlands	FC	100.0	100.0
NST	Socotec Testing Netherlands BV	Netherlands	FC	100.0
P20	Phoenix UK 2020	United Kingdom	FC	98.5	98.7
PLC	Patrick Levy Consulting	France	FC	100.0	100.0
POL	Socotec Polynésie	French Polynesia	FC	100.0	100.0
PSP	PSP Tunnelling Engineers	Germany	FC	92.0	92.0
RBA	URBADS	France	FC	100.0
RBY	URBYCOM	France	FC	100.0
RBS	RINCENT BTP SERVICE SAS	France	EM	40.0	40.0
REU	Socotec Reunion	France	FC	100.0	100.0
S2M	S2M	France	FC	100.0	100.0
SAS	Socotec Smart Solutions	France	FC	100.0	100.0
SCC	Sococonsult	Morocco	FC	99.9	99.9
SCI	Synergen Consulting International LLC	United States	FC	94.7	91.4
SCS	Socotec Control Spain S.LU.	Espagne	FC	100.0
SCT	Socotec Construction	France	FC	100.0	100.0
SDI	SD Ingenieure	Germany	FC	64.9	64.9
SEQ	Socotec Equipements	France	FC	100.0	100.0
SES	Socotec Environnement	France	FC	100.0	100.0
SFO	Socotec Formation	France	FC	100.0	100.0
SGE	Socotec Gestion	France	FC	100.0	100.0
SGH	Environmental Scientifics Group Holdings Limited	United Kingdom	FC	98.5	98.7
SGL	Socotec UK Limited	United Kingdom	FC	98.5	98.7
SHL	Environmental Scientifics Holdings Limited	United Kingdom	FC	98.5	98.7
SID	Socotec Immobilier Durable	France	FC	100.0	100.0
SLD	Scientifics Limited	United Kingdom	FC	98.5	98.7
SMF	Socotec Monitoring France	France	FC	99.5	66.5
SNR	SNER Société Novatrice d'Etudes et Réalisations	France	FC	100.0	100.0
SO1	SOCO1	France	Holding	100.0	100.0
SOF	Socotec Formation Nucléaire	France	FC	100.0	100.0
SQI	Socotec Certification	France	FC	100.0	100.0
STC	Socotec Technical Consulting	France	FC	100.0	100.0
SUH	Socotec UK Holding	United Kingdom	FC	98.5	98.7
TOR	TOR Drilling	United Kingdom	FC	98.5	98.7
UIN	Socotec US Holding Inc	United States	FC	94.7	91.4
ULP	Socotec US Holding LP	United States	FC	94.7	91.4
USC	Socotec Consulting Inc	United States	FC	94.7	91.4
VAG	Veritas Advisory Group	United States	FC	94.7	91.4
VHL	Vidaris Holdings LLC	United States	FC	94.7	91.4
VID	Vidaris Inc	United States	FC	94.7	91.4
VIH	VIH Company	United States	FC	94.7	91.4
WTL	Waterwise Technoloy Limited	United Kingdom	FC	98.5	98.7
ZPC	ZPC GmbH	Germany	FC	87.4	87.4
ZPI	ZPP International GmbH	Germany	FC	92.0	92.0
ZPL	LauPlan GmbH	Germany	FC	92.0	92.0
ZPP	ZPP Ingenieure AG	Germany	FC	92.0	92.0
ZUJ	Zickler & Jakob	Germany	FC	69.2	69.2

NOTE 38 - SOCOTEC GROUP'S TRANSITION TO IFRS AT 1 JANUARY 2021 AND 31 DECEMBER 2021

38.1 > REGULATORY FRAMEWORK AND STANDARDS APPLIED

38.1.1 - BASIS OF PREPARATION

The SOCOTEC Group's consolidated financial statements have been prepared under IFRS for the first time for the year ended 31 December 2022.

In line with the standards in force, and pursuant to IAS 1 - Presentation of Financial Statements and IFRS 1 - First-time Adoption of IFRSs, the Group's consolidated financial statements for the year to 31 December 2022 include comparative information for the 2021 financial year.

For this purpose, the SOCOTEC Group has quantified the impact of the transition to IFRSs on its consolidated financial statements at the transition date and prepared the following comparative financial information for the 2021 financial year:

•	The statement of financial position at the transition date, i.e. 1 January 2021, at which date the definitive impacts of the transition will be recognised in equity when the consolidated financial statements for 2021 are published;
•	The statement of financial position, the income statement and the statement of cash flows at 31 December 2021.

As regards the 2021 financial information, the quantified impacts of the transition to IFRSs have been calculated by applying to the figures for the 2021 financial year the standards and interpretations that the SOCOTEC Group has used to prepare its comparative consolidated financial statements at 31 December 2022, as presented in Note 2.

Note that until 31 December 2021, the Group's consolidated financial statements were prepared under French GAAP as applicable to the consolidated financial statements adopted by the Comite de la Regiementation Comptable (CRC, the French accounting regulations committee) in ANC no. 2020-01, which entered force at 1 January 2021.

38.1.2 - PRESENTATION OF THE STANDARDS AND INTERPRETATIONS APPLIED TO PREPARE THIS INITIAL IFRS FINANCIAL INFORMATION

The Group's consolidated financial statements have been prepared in compliance with the International Financial Reporting Standards ("IFRSs") and interpretations as adopted by the European Union at 31 December 2022 pursuant to Regulation EC no. 1606/2022 of the European Parliament at 31 December 2022 on the adoption of international accounting standards. In addition, these financial statements have been prepared in accordance with the IFRSs issued by the International Accounting Standards Board (IASB).

The standards adopted by the European Union are available for consultation on the European Commission's website at: https://ec.europa.eu/info/law/international-accounting-standards-regulation ecno-1606-2002_fr.

38.1.3 - PRINCIPAL OPTIONS ADOPTED

In preparing its opening balance sheet at 1 January 2021, the Group has adopted the principles for the first-time adoption of IFRSs laid down in IFRS 1.

The IFRS standards are generally applied retrospectively. That said, IFRS 1 provides for certain exceptions to this retrospective application:

•

estimates made in prior periods are left unchanged. Inputs and assumptions that had been used to measure assets, liabilities, expenses and income under the previous standard, have been retained provided that the accounting methods employed were IFRS-compliant.

•

optional exemptions:

•	Business combinations (revised IFRS 3 and IAS 27): the Group has chosen not to restate prior businesses at the transition date of 1 January 2021.
•	Fair value or remeasurement as assumed cost (IAS 16): the Group has elected not to record the fair value or remeasurement of its assets as assumed cost.
•	Accumulated translation reserves (IFRS 1): the Group has chosen to reset to zero the amount of translation reserves in respect of all foreign operations at 1 January 2021.
•	Under IFRS 16, the Group has elected not to apply IFRS 16 under the full retrospective method at 1 January 2021 as if IFRS 16 had always existed, that is from the commencement of each lease.

As regards the other standards, assets and liabilities at 1 January 2021 have been restated retrospectively as if the standards had always been applied.

38.1.4 - TRANSITION FINANCIAL STATEMENTS

The first financial statements published in line with the IAS/IFRS accounting standards are those for the 2022 financial year, presented with comparative information for the 2021 financial year prepared using the same standards. The IAS/IFRS transition date is 1 January 2021.

The transition financial statements are presented hereinafter and consist of:

•	reconciliation from the statement of equity under French GAAP to IFRSs at 1 January 2021 and 31 December 2021;
•	reconciliation from the statement of financial position under French GAAP to IFRSs at 1 January 2021;
•	reconciliation from the statement of financial position under French GAAP to IFRSs at 31 December 2021;
•	reconciliation from the statement of comprehensive income at 31 December 2021 under French GAAP to IFRSs;
•	reconciliation from the statement of cash flows at 31 December 2021 under French GAAP to IFRSs;
•	notes explaining the restatements.

38.2 > FINANCIAL STATEMENTS AT 1 JANUARY 2021

38.2.1 -RECONCILIATION FROM THE STATEMENT OF EQUITY UNDER FRENCH GAAP TO IFRSS

(€ thousands)	Share capital	Share premium	Reserves	Net profit
French GAAP at 1 January 2021	508,832	186,020	(345,113)	(90,490)
IFRS 1/IAS 1 - Translation reserves			(22,627)
IAS 12 - Income Taxes			(6,600)
IFRIC 21 - Levies net of deferred tax			392
IAS 19 - Employee benefits net of deferred tax			(618)
IFRS 15 - Revenue from contracts with customers net of deferred tax			(6,476)
IFRS 16 - Leases net of deferred tax			(4,237)
IFRS 2 - Share-based payment			(7,147)
IFRS 3 - Business Combinations			(85,709)
IFRS at 1 January 2021	508,832	186,020	(478,135)	(90,490)

(€ thousands)	Translation reserves	Total equity attributable to owners of the Company	Non-controlling interests	Total equity
French GAAP at 1 January 2021	(22,627)	236,622	53,771	290,393
IFRS 1/IAS 1 - Translation reserves	22,627	0		0
IAS 12 - Income Taxes		(6,600)		(6,600)
IFRIC 21 - Levies net of deferred tax		392		392
IAS 19 - Employee benefits net of deferred tax		(618)		(618)
IFRS 15 - Revenue from contracts with customers net of deferred tax		(6,476)		(6,476)
IFRS 16 - Leases net of deferred tax		(4,237)	(18)	(4,255)
IFRS 2 - Share-based payment	298	(6,849)	(399)	(7,248)
IFRS 3 - Business Combinations	11	(85,698)		(85,698)
IFRS at 1 January 2021	309	126,536	53,354	179,890

38.2.2 - RECONCILIATION FROM THE STATEMENT OF FINANCIAL POSITION UNDER FRENCH GAAP TO IFRSS

(€ thousands)	1 January 2021	IAS 1 Presentation
Assets
Goodwill	711,025
Intangible assets	236,019
Property, plant and equipment	71,097
Right-of-use assets
Investments in unconsolidated subsidiaries and affiliates	185
Other non-current financial assets	6,688
Equity-accounted investments	919
Deferred tax assets		27,592
Total noncurrent assets	1,025,933	27,592
Inventories
Inventories of raw materials and supplies	1,857
Trade receivables and related accounts	382,284
Other receivables and prepayments	110,872	(46,886)
Current tax assets		19,294
Cash and cash equivalents	81,524
Total current assets	576,536	(27,592)
Disposal group held for sale
TOTAL ASSETS	1,602,470

(€ thousands)	IFRS 1/1AS21 Translation reserves	IAS 12 Income tax	IFRIC 21 Levies	IAS 19 Employee benefits
Assets
Goodwill
Intangible assets
Property, plant and equipment
Right-of-use assets
Investments in unconsolidated subsidiaries and affiliates
Other non-current financial assets
Equity-accounted investments
Deferred tax assets				215
Total noncurrent assets				215
Inventories
Inventories of raw materials and supplies
Trade receivables and related accounts
Other receivables and prepayments
Current tax assets
Cash and cash equivalents
Total current assets
Disposal group held for sale
TOTAL ASSETS				215

(€ thousands)	IFRS 15 Revenue from contracts with customers	IFRS 16 Leases	IFRS 2 Share-based payment	IFRS 3 Business combinations	IFRS 9 Financial instruments	1 January 2021
Assets
Goodwill						711,025
Intangible assets						236,019
Property, plant and equipment						71,097
Right-of-use assets		94,482				94,482
Investments in unconsolidated subsidiaries and affiliates						185
Other non-current financial assets						6,688
Equity-accounted investments						919
Deferred tax assets	2176	25,781				55,764
Total noncurrent assets	2,176	120,263				1,176,180
Inventories
Inventories of raw materials and supplies						1,857
Trade receivables and related accounts	(8,652)					373,632
Other receivables and prepayments		(2,145)			(8,507)	53,334
Current tax assets						19,294
Cash and cash equivalents						81,524
Total current assets	(8,652)	(2,145)			(8,507)	529,640
Disposal group held for sale
TOTAL ASSETS	(6,476)	118,118			(8,507)	1,705,821

(€ thousands)	1 January 2021	IAS 1 Presentation
Equity and liabilities
Share capital	508,832
Share premiums	186,020
Other reserves	9,642
Consolidated reserves	(354,755)
Translation reserves	(22,627)
Profit (loss) attributable to owners of the Company	(90,490)
Equity attributable to owners of the Company	236,622
Reserves attributable to non-controlling interests	53,828
Profit (loss) attributable to non-controlling interests	(56)
Equity attributable to non-controlling interests	53,771
Total equity	290,393
Non-current provisions	64,983	(27,406)
Provisions for employee benefits		27,406
Non-current financial liabilities	772,627	(13,560)
Non-current lease liabilities		1,110
Financial liabilities on acquisitions of securities (non-current)
Deferred tax liability		33,841
Total noncurrent liabilities	837,609	21,391
Current provisions
Current financial liabilities		10,665
Current lease liabilities		1,785
Financial liabilities on acquisitions of securities (current)
Trade payables and related accounts	65,470
Income tax liabilities		16,017
Other current liabilities	408,997	(49,858)
Total current liabilities	474,467	(21,391)
Liabilities related to disposal group held for sale
TOTAL EQUITY AND LIABILITIES	1,602,470

(€ thousands)	IFRS 1/IAS 21 Translation reserves	IAS 12 Income tax	IFRIC 21 Leases	IAS 19 Employee benefits
Equity and liabilities
Share capital
Share premiums
Other reserves
Consolidated reserves	(20,952)	(6,600)	392	(619)
Translation reserves	20,952
Profit (loss) attributable to owners of the Company
Equity attributable to owners of the Company		(6,600)	392	(619)
Reserves attributable to non-controlling interests
Profit (loss) attributable to non-controlling interests
Equity attributable to non-controlling interests
Total equity		(6,600)	392	(619)
Non-current provisions
Provisions for employee benefits				834
Non-current financial liabilities
Non-current lease liabilities
Financial liabilities on acquisitions of securities (non-current)
Deferred tax liability		6,600	138
Total noncurrent liabilities		6,600	138	834
Current provisions
Current financial liabilities
Current lease liabilities
Financial liabilities on acquisitions of securities (current)
Trade payables and related accounts
Income tax liabilities
Other current liabilities			(529)
Total current liabilities			(529)
Liabilities related to disposal group held for sale
TOTAL EQUITY AND LIABILITIES			1	215

(€ thousands)	IFRS 15 Revenue from contracts with customers	IFRS 16 Leases	IFRS 2 Share-based payment	IFRS 3 Business combinations	IFRS 9 Financial instruments	1 January 2021
Equity and liabilities
Share capital						508,832
Share premiums						186,020
Other reserves						9,642
Consolidated reserves	(6,476)	(4,237)	(7,147)	(85,709)		(486,103)
Translation reserves			298	11		(1,366)
Profit (loss) attributable to owners of the Company						(90,490)
Equity attributable to owners of the Company	(6,476)	(4,237)	(6,849)	(85,698)		126,535
Reserves attributable to non-controlling interests		(18)	(399)			53,411
Profit (loss) attributable to non-controlling interests						(56)
Equity attributable to non-controlling interests		(18)	(399)			53,354
Total equity	(6,476)	(4,255)	(7,248)	(85,698)		179,890
Non-current provisions						37,577
Provisions for employee benefits						28,240
Non-current financial liabilities					(8,507)	750,560
Non-current lease liabilities		69,800				70,910
Financial liabilities on acquisitions of securities (non-current)				85,699		85,699
Deferred tax liability		24,306				64,885
Total noncurrent liabilities		94,106		85,699	(8,507)	1,037,870
Current provisions
Current financial liabilities						10,665
Current lease liabilities		28,626				30,411
Financial liabilities on acquisitions of securities (current)
Trade payables and related accounts						65,470
Income tax liabilities						16,017
Other current liabilities		(359)	7,248			365,499
Total current liabilities		28,267	7,248			488,062
Liabilities related to disposal group held for sale
TOTAL EQUITY AND LIABILITIES	(6,476)	118,118		1	(8,507)	1,705,821

38.3 > FINANCIAL STATEMENTS AT 31 DECEMBER 2021

38.3.1 - RECONCILIATION FROM THE STATEMENT OF EQUITY UNDER FRENCH GAAP TO IFRSS

(€ thousands)	Share capital	Share premium	Reserves	Net profit
French GAAP at 31 December 2021	515,021	149,972	(450,320)	(37,798)
IFRS 1/IAS 1 - Translation reserves			(20,965)
IAS 21 - Unrealised exchange gains net of deferred tax			1,016	2,214
IAS 12 - Income Taxes			(6,600)
IFRIC 21 - Levies net of deferred tax			392	33
IAS 19 - Employee benefits net of deferred tax			(619)	(6,385)
IAS 38 - Intangible assets net of deferred tax				(1,001)
IFRS 15 - Revenue from contracts with customers net of deferred tax			(6,476)
IFRS 16 - Leases net of deferred tax			(4,237)	(230)
IFRS 2 - Share-based payment			(6,849)	(9,457)
IFRS 3 - Business combinations			(85,698)	67,046
IFRS 9 - Financial instruments net of deferred tax				190
IFRS at 31 December 2021	515,021	149,972	(580,356)	14,612

(€ thousands)	Other comprehensive income	Translation reserves	Total equity attributable to owners of the Company	Non-controlling interests	Total equity
French GAAP at 31 December 2021		(5,556)	171,319	47,951	219,270
IFRS 1/IAS 1 - Translation reserves		20,965
IAS 21 - Unrealised exchange gains net of deferred tax		5	3,235		3,235
IAS 12 - Income Taxes			(6,600)		(6,600)
IFRIC 21 - Levies net of deferred tax			425		425
IAS 19 - Employee benefits net of deferred tax	5,898		(1,106)	(59)	(1,165)
IAS 38 - Intangible assets net of deferred tax			(1,001)		(1,001)
IFRS 15 - Revenue from contracts with customers net of deferred tax			(6,476)		(6,476)
IFRS 16 - Leases net of deferred tax	(17)	(10)	(4,494)	(41)	(4,535)
IFRS 2 - Share-based payment	3,038	(426)	(13,694)	(705)	(14,399)
IFRS 3 - Business combinations	948	1,376	(16,328)	4,746	(11,582)
IFRS 9 - Financial instruments net of deferred tax	660		850		850
IFRS at 31 December 2021	10,527	16,354	126,128	51,893	178,021

38.3.2 - RECONCILIATION FROM THE STATEMENT OF FINANCIAL POSITION UNDER FRENCH GAAP TO IFRSS

(€ thousands)	31 December 2021, French GAAP	IFRS 15 Revenue from contracts with customers	IAS1 Presentation	IAS 38 SaaS costs
Goodwill	655,553
Intangible assets	244,749			-1,437
Property, plant and equipment	77,712
Right-of-use assets	0
Non-current financial assets	19,537
Deferred tax assets	7,240	2,176		436
NON-CURRENT ASSETS	1,004,789	2,176		-1,001
Inventories	3,118
Contract assets	78,017
Trade receivables	138,329	-8,652
Current income tax receivables	25,548
Other current financial assets	970
Other current assets	107,306
Cash and cash equivalents	158,092
Current assets	511,381	-8,652
Total assets	1,516,171	-6,476		-1,001

(€ thousands)	IFRS 16 Leases	IAS 19 Employee benefits	IFRS 2 Share-based payment	IFRS 3 Commitments to buy out non-controlling interests
Goodwill				71,346
Intangible assets
Property, plant and equipment
Right-of-use assets	92,985
Non-current financial assets				-1,635
Deferred tax assets	25,385	405		1,203
NON-CURRENT ASSETS	118,370	405		70,914
Inventories
Contract assets
Trade receivables
Current income tax receivables
Other current financial assets
Other current assets	-2,292
Cash and cash equivalents
Current assets	-2,292
Total assets	116,078	405		70,914

(€ thousands)	IFRS 9 Financial instruments	IAS 12 Income tax	IFRIC 21 Levies	IFRS 1/IAS 21 Exchange rate effects	IFRS 1/IAS 21 Exchange rateeffects	31 December 2021, IFRS
Goodwill						726,899
Intangible assets						243,311
Property, plant and equipment						77.712
Right-of-use assets						92,985
Non-current financial assets	2,674					20,575
Deferred tax assets						36,845
NON-CURRENT ASSETS	2,674					1,198,326
Inventories						3,118
Contract assets						69,365
Trade receivables						138,330
Current income tax receivables						25,548
Other current financial assets						971
Other current assets	-9,933				-19,614	75,466
Cash and cash equivalents						158,092
Current assets	-9,933				-19,614	470,890
Total assets	-7,259				-19,614	1,669,217

(€ thousands)	31 December 2021, French GAAP	IFRS 15 Revenue from contracts with customers	IAS1 Presentation	IAS 38 SaaS costs
Share capital	515,020
Share and other premiums	149,972
Other reserves	1,481
Consolidated reserves	-451,801	-6,476
Consolidated reserves	0
Net profit - attributable to owners of the Company	-37,798			-1,001
Translation reserves - attributable to owners of the Company	-5,556
Attributable to owners of the Company	171,318	-6,476		-1,001
Non-controlling interests	47,951
Total equity	219,270	-6,476		-1,001
Non-current financial liabilities	854,910		-24,448
Non-current lease liabilities	185		-56
Deferred tax liabilities	12,698
Non-current employee benefits	20,210
Non-current provisions	63,431
NON-CURRENT LIABILITIES	951,433		-26,007
Trade and other payables	272,720
Contract liabilities	10,986
Current income tax liabilities	24,072
Current financial liabilities	0		24,448
Current lease liabilities	0
Other current financial liabilities	1,654
Other current liabilities	36,036
CURRENT LIABILITIES	345,468		26,007
Total equity and liabilities	1,516,172	-6,476		-1,001

(€ thousands)	IFRS 16 Leases	IAS 19 Employee benefits	IFRS 2 Share-based payment	IFRS 3 Commitments to buy out non-controlling interests
Share capital
Share and other premiums
Other reserves
Consolidated reserves	-4,255	-619	-3,811	-84,750
Consolidated reserves		5,898
Net profit - attributable to owners of the Company	-230	-6,385	-9,457	67,045
Translation reserves - attributable to owners of the Company	-10		-426	1,377
Attributable to owners of the Company	-4,494	-1,106	-13,694	-16,329
Non-controlling interests	-41	-59	-705	4,746
Total equity	-4,535	-1,164	-14,399	-11,583
Non-current financial liabilities				82,844
Non-current lease liabilities	65,956
Deferred tax liabilities	23,804
Non-current employee benefits		1,570
Non-current provisions
NON-CURRENT LIABILITIES	89,760	1,570		82,844
Trade and other payables	-410		14,399	789
Contract liabilities
Current income tax liabilities
Current financial liabilities	425
Current lease liabilities	30,838
Other current financial liabilities
Other current liabilities				-1,137
CURRENT LIABILITIES	30,853		14,399	-348
Total equity and liabilities	116,078	405		70,914

(€ thousands)	IFRS 9 Financial instruments	IAS 12 Income tax	IFRIC 21 Levies	IFRS 1/IAS 21 Exchange rate effects	IFRS 1/IAS 21 Exchange rate effects	31 December 2021, IFRS
Share capital						515,021
Share and other premiums						149,972
Other reserves						1,481
Consolidated reserves		-6,600	392	-20,965	1,015	-577,869
Consolidated reserves	660					6,558
Net profit - attributable to owners of the Company	190		34		2,214	14,612
Translation reserves - attributable to owners of the Company				20,965	5	16,354
Attributable to owners of the Company	850	-6,600	426		3,233	126,128
Non-controlling interests					0	51,893
Total equity	850	-6,600	426		3,234	178,021
Non-current financial liabilities	-8,404					903,397
Non-current lease liabilities						66,086
Deferred tax liabilities	295	6,600	149			43,546
Non-current employee benefits						21,780
Non-current provisions					-19,614	43,816
NON-CURRENT LIABILITIES	-8,109	6,600	149		-19,614	1,078,626
Trade and other payables			-574			286,924
Contract liabilities						10,986
Current income tax liabilities						24,072
Current financial liabilities						26,433
Current lease liabilities						30,838
Other current financial liabilities						1,654
Other current liabilities					-3,234	31,665
CURRENT LIABILITIES			-574		-3,234	412,571
Total equity and liabilities	-7,259				-19,614	1,669,218

38.3.3 - RECONCILIATION FROM THE STATEMENT OF INCOME UNDER FRENCH GAAP TO IFRSS

(€ thousands)	31 December 2021, French GAAP	IAS 21 Unrealised gains and losses	IFRIC 21 Levies	IAS 19 Employee benefits
Revenue	997,727
Staff costs	(510,895)			(86)
Other purchases and external charges	(307,272)
Taxes and duties	(13,159)		45
Depreciation, amortisation and impairment of non-current assets	(54,610)
Additions to provisions net of reversals	(10,203)			(762)
Goodwill impairment losses	(93,573)
Other current operating income	2,575
Other income	5,551
Other current operating expense	383			2
Other operational income and expense	(14,160)
Operating income	2,364		45	(846)
Net cost of debt	(34,679)
Other financial income and expenses	3,758	2,214		(7,304)
Profit before tax	(28,557)	2,214	45	(8,150)
Income tax expense	(14,699)		(12)	1,706
Share of profit or loss of companies accounted for under the equity method	467
Consolidated net profit - continuing operations	(42,789)	2,214	33	(6,444)
Consolidated net profit - total	(42,789)	2,214	33	(6,444)
Net profit - attributable to owners of the Company	(37,800)	2,214	33	(6,385)
Total net profit attributable to non-controlling interests	4,989			59

(€ thousands)	IAS 38 SaaS costs	IFRS 16 Leases	IFRS 2 Share-based payment	IFRS 3 Business combinations
Revenue
Staff costs			(9,745)	(706)
Other purchases and external charges	(1,563)	31,643
Taxes and duties
Depreciation, amortisation and impairment of non-current assets	126	(28,132)
Additions to provisions net of reversals
Goodwill impairment losses				75,357
Other current operating income				0
Other income				0
Other current operating expense				0
Other operational income and expense		3		(535)
Operating income	(1,437)	3,514	(9,745)	74,116
Net cost of debt		(3,869)
Other financial income and expenses		(0)		(3,394)
Profit before tax	(1,437)	(355)	(9,745)	70,722
Income tax expense	436	98		1,201
Share of profit or loss of companies accounted for under the equity method
Consolidated net profit - continuing operations	(1,001)	(257)	(9,745)	71,923
Consolidated net profit - total	(1,001)	(257)	(9,745)	71,923
Net profit - attributable to owners of the Company	(1,001)	(230)	(9,457)	67,046
Total net profit attributable to non-controlling interests		27	288	(4,877)

(€ thousands)	IFRS 9 Financial instruments	IAS 12 CVAE levy	31 December 2021, IFRS
Revenue			997,727
Staff costs			(521,432)
Other purchases and external charges	9,008		(268,184)
Taxes and duties		3,413	(9,701)
Depreciation, amortisation and impairment of non-current assets			(82,616)
Additions to provisions net of reversals			(10,965)
Goodwill impairment losses			(18,216)
Other current operating income	4,486		7,061
Other income			5,551
Other current operating expense	(9,057)		(8,672)
Other operational income and expense			(14,692)
Operating income	4,437	3,413	75,861
Net cost of debt	(4,182)		(42,730)
Other financial income and expenses			(4,726)
Profit before tax	255	3,413	28,405
Income tax expense	(65)	(3,413)	(14,747)
Share of profit or loss of companies accounted for under the equity method			467
Consolidated net profit - continuing operations	190		14,125
Consolidated net profit - total	190		14,125
Net profit - attributable to owners of the Company	190		14,611
Total net profit attributable to non-controlling interests			486

38.3.4 - RECONCILIATION FROM THE STATEMENT OF CASH FLOWS UNDER FRENCH GAAP TO IFRSS;

(€ thousands)	31 December 2021, French GAAP	IAS 21 Unrealised gains and losses
Consolidated net profit	-42,789	2,214
Profit (loss) of companies accounted for under the equity method	-467
Depreciation, amortisation and provisions, net	147,756	-1,802
Change in deferred tax	-6,414
Unrealised foreign exchange gains and losses	95	-824
Other income and expense (gains or losses on asset disposals)	3,102
Capitalised accrued interest on the SOCO1 shareholder loan	0
Cash from operating activities before changes in the WCR	101,283	-412
Changes in net inventories	-11,723
Changes in receivables	53,155
Change in other financial liabilities	12,594
Change in the WCR	54,028
Net cash from operating activities	155,311	-412
Purchases of property, plant and equipment and intangible assets	-31,480
Purchases of non-current financial assets	-28,525
Disposals of property, plant and equipment and intangible assets	3,481
Disposals of non-current financial assets	12
Impact of changes in scope	-30,887
Net cash from (used in) investing activities	-87,400
Increase in share capital	0	0
Dividends received	127
Dividends paid to non-controlling interests	-2,220
Dividends paid to parent company shareholders	-39,606
Net change in financial receivables and debt	53,943
Net cash from financing activities	12,244	0
Impact of translation differences	2,831
Resulting change in cash	82,986	-412
Cash at beginning of period	78,344
Cash at end of period	156,609

(€ thousands)	IAS 38 SaaS costs	IFRS 16 Leases	IAS 19 Employee benefits	IFRS 2 Sharebased payment
Consolidated net profit	-1,001	-257	-6,444	-9,745
Profit (loss) of companies accounted for under the equity method
Depreciation, amortisation and provisions, net	-126	28,132	8,066
Change in deferred tax	-436	-98	-1,734
Unrealised foreign exchange gains and losses
Other income and expense (gains or losses on asset disposals)		3,869	86	9,745
Capitalised accrued interest on the SOCO1 shareholder loan
Cash from operating activities before changes in the WCR	-1,563	31,646	-26	0
Changes in net inventories
Changes in receivables		5,865
Change in other financial liabilities		49
Change in the WCR		5,914
Net cash from operating activities	-1,563	37,560	-26	0
Purchases of property, plant and equipment and intangible assets	1,563
Purchases of non-current financial assets
Disposals of property, plant and equipment and intangible assets
Disposals of non-current financial assets
Impact of changes in scope
Net cash from (used in) investing activities	1,563
Increase in share capital
Dividends received
Dividends paid to non-controlling interests
Dividends paid to parent company shareholders
Net change in financial receivables and debt		-37,561
Net cash from financing activities	0	-37,561	0	0
Impact of translation differences
Resulting change in cash			-26
Cash at beginning of period
Cash at end of period

(€ thousands)	IFRS 3 Business combinations	IFRS 9 Financial instruments	IFRIC 21 Levies	31 December 2021, IFRS
Consolidated net profit	71,922	190	36	14,126
Profit (loss) of companies accounted for under the equity method				-467
Depreciation, amortisation and provisions, net	-75,357	-4,486		102,184
Change in deferred tax	-1,201	65	11	-9,807
Unrealised foreign exchange gains and losses				-729
Other income and expense (gains or losses on asset disposals)	235			17,037
Capitalised accrued interest on the SOCO1 shareholder loan				0
Cash from operating activities before changes in the WCR	-4,401	-4,231	47	122,343
Changes in net inventories				-11,723
Changes in receivables		1,630		60,650
Change in other financial liabilities	-345		-45	12,253
Change in the WCR	-345	1,630	-45	61,182
Net cash from operating activities	-4,746	-2,601	2	183,525
Purchases of property, plant and equipment and intangible assets				-29,917
Purchases of non-current financial assets	1,627	-1,784		-28,682
Disposals of property, plant and equipment and intangible assets				3,481
Disposals of non-current financial assets				12
Impact of changes in scope				-30,887
Net cash from (used in) investing activities	1,627	-1,784		-85,994
Increase in share capital				0
Dividends received				127
Dividends paid to non-controlling interests				-2,220
Dividends paid to parent company shareholders				-39,606
Net change in financial receivables and debt	3,119	103		19,604
Net cash from financing activities	3,119	103	0	-22,096
Impact of translation differences				2,831
Resulting change in cash		-4,282		78,266
Cash at beginning of period				78,344
Cash at end of period				156,609

38.4 > NOTES EXPLAINING THE MAIN RESTATEMENTS AT JANUARY 1, 2021 AND DECEMBER 31, 2021

38.4.1 - NOTES EXPLAINING THE MAIN RESTATEMENTS

38.4.1.1 IAS 1 - Presentation of Financial Statements

• STATEMENTS OF FINANCIAL POSITION AT 1 JANUARY 2021 AND 31 DECEMBER 2021

Assets and liabilities have been divided up into current and non-current portions based their maturity. The main impacts on the Group are:

―	Reclassification of the provisions and financial liabilities with a maturity of less than one year;
―	A distinction being made between provisions and provisions for employee benefits;
―	A split between €24.7 million in other receivables and accruals and other current liabilities, on the one hand, and €24.07 million in current tax assets and liabilities, on the other hand.
―	A split between €27.6 million in other receivables and other liabilities, on the one hand, and €33.8 million in deferred tax assets and liabilities, on the other hand, which are reclassified on a separate line in non-current assets and liabilities.

• At 31 December 2021, on the income statement and on the statement of cash flows

Income statement

No significant reclassifications were made pursuant to IAS 1 at the level of French-GAAP "Operating income" and "Net non-recurring items" now combined to form IFRS "Operating income", which amounted to €2.8 million versus €2.4 million.

Several reclassifications were made at operating income level:

―	€0.9 million in allowances net of reversals to provisions for retirement benefit obligations, which were reclassified to staff costs.
―	€-10.5 million in changes in work in progress, which were reclassified under other purchases and external charges.
―	€-4.5 million in amortisation of deferred costs, which were reclassified to allowances to provisions net of reversals,

Conversely, in line with the definition of "other operating income and expenses" under IFRSs, €-13 million in items previously presented under "Net exceptional income" and €-93.6 million in "amortisation and impairment of goodwill" are now presented under "Other operating income and expenses".

These reclassification aims to provide greater clarity concerning performance of the business, which the Group presents under operating income, while excluding items that have little predictive value owing to their nature, frequency and/or relative importance. These items, which are recorded under "other operating income" and "other operating expenses" include: :

•	Charges related to restructuring or retrenchment plans approved by Group management
•	The impact of acquisition-related costs
•	Impairment losses on non-current assets

Reclassifications between operating income and other income statement headings alone had a positive impact on operating income of €425 thousand attributable to:

―	Capital gains and losses on net financial assets that are now reclassified in other financial income and expenses and had a positive impact on operating income of €425 thousand.

Consolidated statement of cash flows

On the consolidated statement ofcash flows, the transition to IFRS solely leads to reclassifications between headings to comply with the presentation requirements and does not thus have any impact on the amount of cash generated by the Group.

The new format of the Group's consolidated statement of cash flows is based on a simple presentation based on the following three clearly identifiable components:

―	Net cash from operating activities;
―	Net cash from (used in) investing activities;
―	Net cash from financing activities;

Net cash from operating activities is the sum of:

―	gross cash from operating activities, which comprises consolidated net income, as shown on the consolidated income statement, adjusted by eliminating non-cash income and expenses, while clearly separating out net interest paid and net tax paid;
―	the change in the working capital requirement related to operating activities.

38.4.1.2 IFRS 1/IAS 21 - Translation reserves

At 1 January 2021:

As provided for under the option available in IFRS 1, €21 million in opening translation reserves have been reclassified under consolidated retained earnings.

At 31 December 2021, on the income statement and on the consolidated statement of cash flows:

Under French GAAP, regulation ANC 2020-01 applicable for periods beginning on or after 1 January 2021 required translation reserves and provisions for unrealised currency losses to be retained.

Under IAS 21, foreign exchange gains and losses on monetary items are recognised in income. The restatement carried out is equivalent to recognising in the income statement the currency effects related to the unrealised gains and losses and eliminating provisions for currency risks. The impact on the income statement is €2.2 million.

38.4.1.3 IAS 19 - Employee benefits

At 1 January 2021:

Application of this standard has a limited impact on the financial statements at 1 January 2021 arising from adoption of the IFRIS IC interpretation early at the transition date at 1 January 2021, which leads to a decrease in provisions and updated assumptions in the mortality tables.

At 31 December 2021, on the income statement and on the consolidated statement of cash flows:

Under French GAAP, actuarial gains and losses were expensed directly during the year as follows:

―	in operating income for the portion of actuarial gains and losses other than the change in the discount rate, leading to a €0.9 million reversal of a provision for operating items in 2021;
―	in other financial income and expense for the portion of actuarial gains and losses other than the change in the discount rate, leading to a €-7.3 million allowance to provisions for financial items in 2021;

Under IFRSs, actuarial gains and losses, irrespective of their nature, are recognised in the statement of comprehensive income. The consolidated income statement has been adjusted accordingly.

38.4.1.4 IAS 38 - SaaS costs

At 31 December 2021, the Group restated its Software as a Service (SaaS) costs (IFRIC). They were initially capitalised, but relate to software that does not grant the entity the right to determine when and how to modify the software or to choose on what alternative infrastructure to host the solution. Expenses arising from upgrades and configuration of the various solutions have been restated and are recognised on the financial statements as follows:

Generally speaking, the cost of implementing software in SaaS mode depends on how the underlying SaaS contract is classified for accounting purposes (non-current asset or service), whereby the related amount (i.e. implementation) is accounted for in the same manner as the main item (the software). Accordingly:

―	if the SaaS contract can be considered as an acquisition of an intangible asset, SaaS mode software implementation costs are accounted for in a similar way to the costs of implementing a purchased software licence, which involves applying the criteria for the capitalisation of development expenses;
―	if the SaaS contract is a service agreement, the costs of implementing software in SaaS mode may not be capitalised. External charges reflect services expensed as they are incurred and may not thus be recognised in the same way as the costs of implementing a purchased software licence.

Income statement

The expenses incurred in 2021 in relation to the SaaS solutions have been recognised under operating expenses. They totalled €1.4 million before deferred tax.

Balance sheet

The expenses capitalised under intangible assets were reduced by an identical amount of €1.4 million at 31 December 2021.

Consolidated statement of cash flows

On the statement of cash flows, this restatement reduces net cash from operating activities and increases net cash from (used in) investing activities.

38.4.1.5 IFRS 15 - Revenue recognition

The criteria for the transfer of control, which determine how revenue is recognised, were analysed. This analysis shows that in the French construction segment, the Group recognised 5% of revenue upon the signature of contracts. Under IFRS 15, no performance obligations had been met at that point, and so no portion of revenue could be recognised.

Only once the performance obligations has been satisfied by handing over deliverables and providing the specific reports laid down in the contract entered into with the customer are the service performance criteria met. The Group is then able to recognise the relevant service revenue.

The restatement of around €8.7 million at 1 January 2021 led to a reduction in customer contracts in progress. The amount at 31 December 2021 was similar.

38.4.1.6 IFRS 16 - Leases

Under IFRSs, leases are accounted for as a right-of-use asset in respect of the asset made available by the lessor and a balancing lease liability representing the present value of the lease payments that the lessee undertakes to pay over the life of the lease.

As permitted under the standard, the Group has excluded:

―	Leases with a residual term of 12 months or less;
―	Leases for low-value assets (the Group adopted a threshold of $5,000 or €5,000).

Of the key points under this standard, the Group pays special attention to lease terms, the options available within contractual agreements and the discount rates to be applied. With regard to lease terms, the Group analyses each lease individually and, where there is no extension or early termination option in the lease reasonably certain to be exercised, it uses the non-cancellable period.

For the discount rate, the rate adopted is the interest rate implicit in the lease, where such exists. Where no interest rate is implicit in the lease, as recommended by the standard, the Group has formulated a methodology for calculating an incremental borrowing rate applicable to financing the leased assets. It is a discount rate calculated by country and maturity, drawing on the following parameters: benchmark rate in the relevant currency and credit spread.

At 1 January 2021:

At the transition date, the Group has opted to apply IFRS 16 under the simplified retrospective method at 1 January 2021. As a result, the impact is recognised in the opening balance sheet at 1 January 2021, which provides for recognition of a lease at the transition date corresponding to merely the discounted residual lease payments, together with a balancing right-of-use asset adjusted by the amount of lease payments paid in advance and recorded in accrued expenses.

Application of IFRS 16 gives rise to the following main impacts:

―	a €94.5 million increase in non-current assets (right-of-use assets);
―	a €2.2 million reduction in other current receivables (prepaid expenses);
―	a €98.4 million increase in liabilities (lease liabilities):
―	€69.8 million non-current portion,
―	€28.6 million current portion.

The Group adopted early the IAS 12 Amendment on Deferred Tax related to Assets and Liabilities arising from a Single Transaction, which consists in recognising a deferred tax asset related to lease liabilities and recognising a deferred tax liability calculated on the net value of right-of-use assets.

At 31 December 2021, on the income statement and on the statement of cash flows:

The amounts related to application of IFRS 16 on the 2021 income statement and on the balance sheet at 31 December 2021 solely reflect the cash flows arising from the application of leases in place at the beginning of the year or entered into during 2021.

Application of the IFRS 16 standard gives rise to the following main impacts:

On the income statement

A €3.5 million improvement in current operating income owing to the derecognition of €31.6 million in lease payments in conjunction with the balancing entry of €28.1 million in depreciation expense in respect of right-of-use assets.

A €3.9 million reduction in financial income attributable to the recognition of interest expense on the lease liabilities.

On the statement of cash flows

Application of the IFRS 16 standard gives rise to:

―

a €37.6 million improvement in net cash from operating activities owing to the restatement in the statement of cash flows of the depreciation expense in respect of right-of-use assets recognised in the income statement in conjunction with the balancing derecognition of € 28.1 million in lease expense, €3.9 million in interest expense on lease liabilities and €5.9 million in working capital requirement.

―

> an identical €37.6 million reduction in net cash from financing activities.

Application of IFRS 16 leads to the principal repayment and interest payment being shown in financing activities.

38.4.1.7 IFRS 2 - Share-based payment

Application of IFRS 2 - Share-based Payment changes the way in which stock options awarded by the Group to its employees are accounted for: the value of these plans, which are regarded as additional compensation, is now recognised under staff costs.

Pursuant to IFRS 1, the SOCOTEC Group has taken into account only the plans that had not vested fully at 1 January 2021.

Recognition of this deferred compensation is spread over the rights vesting period according to the vesting terms specific to each plan. The balancing entry for the expense will be in equity or debt according to the terms of the plan and the settlement arrangements for the benefits granted. Accordingly, the plans to be settled by the delivery of equity instruments are shown in equity, while the plans generating a cash flow when they are settled are shown in debt.

Recognition of this deferred compensation is spread over the rights vesting period according to the vesting terms specific to each plan. The balancing entry for the expense will be in equity or debt according to the terms of the plan and the settlement arrangements for the benefits granted.

On the income statement

The staff costs shown in current operating income amounted to €9.8 million, €3.3 million of which leads to a balancing adjustment to consolidated retained earnings.

On the balance sheet

The employee benefit liability stood at €14.1 million at 31 December 2021, compared with €7.3 million at 1 January 2021.

On the statement of cash flows

No change in net cash from operating activities.

38.4.1.8. IFRS 3 - Business Combinations, IFRS 10 - Financial Statements and IAS 32 - Financial Instruments: Presentation

Every year, the Group amortised the goodwill subject to amortisation and conducted asset impairment tests on all the goodwill.

Income statement

The goodwill amortisation expense recognised under French GAAP amounted to €93.6 million in 2021. This amount included €75.3 million in goodwill amortisation and €18.2 million in impairment losses recognised on the SOCOTEC Monitoring France subsidiary following the impairment tests carried out at the 31 December 2021 year-end. The impairment loss was left under other operating income and expense in the IFRS income statement.

The €0.5 million in direct costs recognised on the acquisition of control of the subsidiary were expensed (Other operating expense) as they were incurred.

The €235 thousand in changes to earn-out payments occurring after the end of the measurement period were recognised under IFRSs in the income statement where they do not relate to an equity instrument.

Earn-out payments considered as compensation for post-acquisition services are recognised as staff costs as they were incurred. The restatement at 31 December 2021 amounted to €-0.7 million.

Balance sheet

The Group recognised repurchase commitments for securities held by non-controlling shareholders obliging the Socotec Group to buy back non-controlling interests in the future. Measurements of these commitments are reviewed every year based on the expected performance of the subsidiary or the groups acquired.

The puts granted to non-controlling shareholders or forwards must give rise to recognition of a financial liability reflecting the obligation for the buyer to buy back the underlying interests. The balancing entry for these commitments depends on the terms and conditions of grant. Where they are separate from the acquisition of control and when they do not put the buyer in the same economic position as the legal holder of the securities, they are recognised with a balancing adjustment in group equity.

In addition, at the end of each period, the debt is remeasured according to changes in the parameters determining the value of the commitment.

Changes in the commitments to repurchase non-controlling interests are recognised in equity. The debt amounted to €82.4 million at 31 December 2021.

Consolidated statement of cash flows

For the purpose of the transition to IFRSs, the adjustments recognised on the income statement are cancelled in non-cash income and expenses on the consolidated statement of cash flows. So there is no impact on gross cash from operating activities.

Acquisitions of additional securities over which the SOCOTEC Group already had control and cash outflows were reclassified from cash from (used in) investing activities to cash from financing activities under "transactions between shareholders, partial acquisitions/disposals". Acquisitions of additional securities or disposals of securities not calling into question exclusive control do not give rise to recognition of additional goodwill or to any gains or losses on partial disposals. All these effects will impact equity only.

38.4.1.9. IFRS 9 - Financial Instruments

38.4.1.9.1 - Borrowing costs

At 1 January 2021, prior to the adoption of IFRSs, the Group recognised borrowing costs under deferred costs.

IFRSs provide for application of the effective interest rate method, which consists in recognising on the balance sheet the funding raised net of all borrowing costs (debt issuance premium and arrangement costs).

The balancing entry is a financial expense, and its amount depends on the plan to repay the underlying financial liability.

In 2021, the Group refinanced its debt, which was classified under IFRS 9 as extinguishing the initial financial liability and issuing a new financial liability recognised at fair value. The residual expenses related to the previous financial liability were recognised in expenses and the issue costs offset against the amount of the new liability.

On the balance sheet

At 1 January 2021:

At the transition date, application of IFRS 9 gives rise to the following main impacts:

―	an €8.5 million reduction in other receivables representing the amount of borrowing costs not yet amortised.
―	an €8.5 million reduction in financial liabilities reflecting the total amount of financing expenses (arrangement costs) not yet amortised by the transition date.

At 31 December 2021:

Application of the IFRS 9 standard gives rise to the following main impacts:

―	an €8.3 million reduction in other receivables representing the outstanding amount of deferred costs
―	an €8.4 million reduction in financial liabilities reflecting the total amount of financing expenses not yet amortised by 31 December 2021.

On the income statement:

The impacts in the 2021 financial year are of two orders:

―	Firstly, the recognition in 2021 in the cost of debt of €4.4 million in residual expenses that arose on the financial liability repaid early in 2021, initially recognised as an allowance to deferred costs under French GAAP;
―	Secondly, the €9 million restatement of borrowing costs as a reduction in the new financial liability issued recognised in deferred costs partially amortised at 31 December 2021.

On the statement of cash flows

No change in net cash from operating activities. The borrowing costs related to the debt issued in 2021 were reduced by net changes in receivables and financial liabilities under French GAAP.

38.4.1.9.2 - Derivatives

The Group uses interest rate caps issued in 2021 to hedge a portion of its financial liabilities (floatingrate liabilities). These financial instruments were arranged for the purpose of hedging cash flows, and the effective portion of the instrument's value, which is recognised in OCI, is then transferred to the income statement at the same pace at which hedged cash flows affect the income statement.

These instruments are measured on the basis of their intrinsic value and time value. The time value is accounted for as the hedging cost in accordance with IFRS 9 § 6.5.15, and so the initial time value is amortised over the life of the caps.

The French GAAP-IFRS restatements to the caps at 31 December 2021 came to €2.7 million, and the change in fair value over the period was €0.8 million net of deferred taxes.

38.4.1.10 IAS 12 - Income Taxes

On the balance sheet at 1 January 2021

IAS 12 - Income tax does not provide for any exception to the recognition of deferred tax on unamortised intangible assets that may not be sold separately from the entity acquired (brands, patents, etc.). The SOCOTEC Holding brand meets the criteria for recognition as an intangible asset under IAS 38, giving rise to recognition of a €6.6 million deferred tax liability.

On the income statement

Under IFRSs, the Group considers the CVAE (contribution for enterprise added value) levy as an income tax because it is based on income statement items and has to be restated for the €3.4 million in operating tax expense.

On the statement of cash flows at 31 December 2021

Reclassifying the CVAE contribution as income tax leads to the reclassification of the same expense items on the statement of cash flows, as well as the amounts paid during the period. This reclassification does not affect net cash generated from operating activities.

SOCO 1

Statutory auditors' report on the consolidated financial statements For the year ended December 31, 2022

This is a translation into English of the statutory auditors' report on the financial statements of the Socotec Group issued in French and it is provided solely for the convenience of English-speaking users.

This statutory auditors' report includes information required by French law, such as information about the appointment of the statutory auditors or verification of the management report and other documents provided to shareholders.

This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.

SOCO 1

Société par actions simplifiée

Trade and companies register No: Versailles 789 991 221

Statutory auditors' report on the consolidated financial statements For the year ended December 31, 2022

To the SOCO 1 Shareholders' meeting,

Opinion

In compliance with the engagement entrusted to us by your Shareholders' Meetings, we have audited the accompanying consolidated financial statements of SOCO 1 for the year ended December 31, 2022.

In our opinion, the consolidated financial statements give a true and fair view of the assets and liabilities and of the financial position of the Group as at December 31,2022 and of the results of its operations for the year then ended in accordance with International Financial Reporting Standards as adopted by the European Union.

Basis for opinion

Audit framework

We conducted our audit in accordance with professional standards applicable in France. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Our responsibilities under those standards are further described in the Statutory Auditors' Responsibilities for the Audit of the Consolidated Financial Statements section of our report.

Independance

We conducted our audit engagement in compliance with independence requirements of the French Commercial Code (code de commerce) and the French Code of ethics (code de déontologie) for statutory auditors, for the period from January 1st, 2022 to the date of our report.

Observation

Without qualifying the opinion expressed above, we draw your attention to the following matter set out in note 38 to the consolidated financial statements concerning the Socotec Group's transition to IFRS.

Justification of assessments

In accordance with the requirements of Articles L. 823-9 and R. 823-7 of the French Commercial Code (code de commerce) relating to the justification of our assessments, we inform you of the following matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period.

Accounting estimates

Your company have some liabilities according to the terms described in note 25 of the consolidated financial statements.

Based on the information available, our assessment of the liabilities was based on the analysis of the processes put in place by the group in order to identify and estimates the risks, as well as the examination of the risks attached to the main liabilities booked.

Goodwill

Goodwill is booked in the assets of the balance sheet for a total, net of amortization and depreciation, of 726,899 thousand euros. The methods for recognizing goodwill are described in note 7 to the financial statements.

Based on the information available to date, our assessment of goodwill was based on an analysis of the processes implemented by the Group to identify and assess the value of these intangible assets, as well as on an examination of the model used to determine the value in use and the reasonableness of the financial parameters used in the impairment tests.

These matters were addressed in the context of our audit of the consolidated financial statements as a whole, approved in the conditions mentioned above, and in forming our opinion thereon, and we do not provide a separate opinion on specific items of the consolidated financial statements.

Specific verifications

We have also performed, in accordance with professional standards applicable in France, the specific verifications required by French law and regulations.

We have no matters to report as to the fair presentation and the consistency with the consolidated financial statements of the information given in the management report of the President and in the other documents provided to Shareholders with respect to the financial position and the consolidated financial statements.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with French accounting principles and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless it is expected to liquidate the Company or to cease operations.

The consolidated financial statements were approved by the President.

Statutory Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

Our role is to issue a report on the consolidated financial statements. Our objective is to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with professional standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As specified in Article L. 823-10-1 of the French Commercial Code (code de commerce), our statutory audit does not include assurance on the viability of the Company or the quality of management of the affairs of the Company.

As part of an audit conducted in accordance with professional standards applicable in France, the statutory auditor exercises professional judgment throughout the audit and furthermore:

•	Identifies and assesses the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, designs and performs audit procedures responsive to those risks, and obtains audit evidence considered to be sufficient and appropriate to provide a basis for his opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
•	Obtains an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control.
•	Evaluates the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management in the consolidated financial statements.
•	Assesses the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. This assessment is based on the audit evidence obtained up to the date of his audit report. However, future events or conditions may cause the Company to cease to continue as a going concern. If the statutory auditor concludes that a material uncertainty exists, there is a requirement to draw attention in the audit report to the related disclosures in the consolidated financial statements or, if such disclosures are not provided or inadequate, to modify the opinion expressed therein.
•	Evaluates the overall presentation of the consolidated financial statements and assesses whether these statements represent the underlying transactions and events in a manner that achieves fair presentation.
•	Obtains sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. The statutory auditor is responsible for the direction, supervision and performance of the audit of the consolidated financial statements and for the opinion expressed on these consolidated financial statements.

Paris La Défense, May 24, 2023

Mazars

The statutory auditors

Isabelle Massa, Partner

Neuilly-sur-Seine, May 24, 2023

Grant Thornton

Membre français de Grant Thornton International

Vincent Frambourt, Partner

ZPP Ingenieure AG

Eigentümerstruktur