Michelin couv courteGB

Summary:
Michelin Group will apply the presentation and measurement principles specified in IAS 32 and IAS 39 as from January 1, 2005.
The impact of this application as from January 1, 2005 to the various categories of financial assets and liabilities by means of:
• a calculation of fair value, or
• the calculation of an amortized cost at the global effective rate, and
• the implementation of hedge accounting,
will have a positive impact on 2005 Shareholders’ equity.
5.2. Elements of sector information
Under French GAAP at December 31, 2004 SR1 SR2 SR3 Inter-sector TOTAL
Net sales 8,292 4,899 2,666 (168) 15,689
Operating income 757 505 37 1,299
Percentage 9.1% 10.3% 1.4% 8.3%
Under IFRS at December 31, 2004 SR1 SR2 SR3 Inter-sector TOTAL
Net sales 8,293 4,899 1,892 (36) 15,048
Operating revenue before non-recurring items 768 500 35 1,303
Percentage 9.3% 10.2% 1.8% 8.65%
Operating revenue 768 500 (29) 1,239
Percentage 9.3% 10.2% (1.5%) 8.2%
Reporting Segment 1 (SR1): Passenger Car-Light Truck and corresponding distribution operations
Reporting Segment 2 (SR2): Truck and corresponding distribution operations
Reporting Segment 3 (SR3): Earthmover, Agricultural, Two Wheels and Aircraft plus Maps and Guides, ViaMichelin, Michelin Lifestyle and Wheels (in the process of being transferred)
The difference as between before and after non-recurring items is entirely due to the provision for potential loss on the transfer of the
Group's Wheel holdings (€66 million).
5.3. Information concerning non-recurring items
The non-recurring items in the 2004 statement of income restated under IFRS consist exclusively of the probable capital loss that could
result from the planned disposal of the companies belonging to the Michelin Wheel business.
Since an impairment loss in respect of the intangible assets, property, plant and equipment and goodwill of these companies had been
recognized in the opening balance sheet at January 1, 2004 prepared under IFRS, an additional impairment loss of €64 million, based
on the offer received by the Group in 2004 and made public on February 16, 2005, was recognized at December 31, 2004.
The values of the balance sheet items expected to be sold are estimated as follows:
• Assets: €235 million,
• Liabilities: €203 million,
• Shareholders’ equity after recapitalization of the companies sold: €32 million.