Carrefour - 2017 Registration Document

4 MANAGEMENT’S DISCUSSION AND ANALYSIS AS OF DECEMBER 31, 2017 Group financial position CARREFOUR | 2017 REGISTRATION DOCUMENT 179 Financing and liquidity resources 4.2.4 Corporate Treasury and Financing’s liquidity management strategy consists of: promoting conservative financing strategies in order to ensure ● that the Group has a sufficiently strong credit rating and can raise funds on the bond and commercial paper markets; maintaining a presence in the debt market through regular debt ● issuance programmes, mainly in euros, in order to create a balanced maturity profile. The Group’s issuance capacity under its Euro Medium Term Notes (EMTN) programme totals 12 billion euros; using the 5 billion-euro commercial paper programme on ● Euronext Paris, described in a prospectus filed with the Banque de France; programme. The loan agreements for the syndicated lines of credit include the usual commitments clauses, including pari passu, negative pledge, change of control and cross-default clauses and a clause restricting substantial sales of assets. The pricing grid may be adjusted up or down to reflect changes in the long-term credit rating. maintaining undrawn medium-term bank facilities that can be ● drawn down at any time according to the Group’s needs. At December 31, 2017, the Group had two undrawn syndicated lines of credit obtained from a pool of leading banks, for a total of 3.9 billion euros. Group policy consists of keeping these facilities on stand-by to support the commercial paper In Brazil, Atacadão SA issued commercial promissory notes (notas promissórias) with maturity between 6 and 19 months during the second half of the year amounting to a total of 2 billion Brazilian reals (Note 12.2.2 to the Consolidated Financial Statements). The Group considers that its liquidity position is robust, as it has sufficient cash reserves to meet its debt repayment obligations in the coming year. The Group’s debt profile is balanced, with no peak in refinancing needs across the remaining life of bond debt, which averaged three years and nine months. At December 31, 2017, Carrefour was rated BBB+/A-2 with a stable outlook by S&P. Restrictions on the use of capital resources 4.2.5 There are no material restrictions on the Group’s ability to recover countries. The local supervisory authorities may require banking or use the assets and settle the liabilities of foreign operations, subsidiaries to comply with certain capital, liquidity and other ratios except for those resulting from local regulations in its host and to limit their exposure to other Group parties. Expected sources of funding 4.2.6 To meet its commitments, Carrefour can use its free cash flow and raise debt capital using its EMTN and commercial paper programmes, as well as its credit lines.