H1 2022 Results - Stellantis Affiliate Growth and Profitability
NON-GAAP FINANCIAL MEASURES
STELLANTIS
Stellantis monitors its operations through the use of several non-generally accepted accounting principles (non-GAAP) financial measures. Company management believes
that these non-GAAP financial measures provide useful and relevant information regarding our operating results and enhance the overall ability to assess our financial
performance. These measures provide comparable measures which facilitate management's ability to identify operational trends, as well as make decisions regarding future
spending, resource allocations and other operational decisions. These and similar measures are widely used in the industry in which the Company operates, however, these
financial measures may not be comparable to other similarly titled measures of other companies and are not intended to be substitutes for measures of financial performance
as prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), as well as IFRS as
adopted by the European Union.
Stellantis' non-GAAP financial measures are defined as follows:
Adjusted Operating Income/(Loss) excludes from Net Profit/(Loss) from Continuing Operations adjustments comprising restructuring, impairments, asset write-offs,
disposals of investments and unusual operating income/(expense) that are considered rare or discrete events and are infrequent in nature, as inclusion of such items is not
considered to be indicative of the Company's ongoing operating performance, and also excludes Net Financial Expenses/(Income), Tax Expense/(Benefit) and Share of the
Profit/(Loss) of Equity Method Investees.
Unusual operating income/(expense) are impacts from strategic decisions, as well as events considered rare or discrete and infrequent in nature, as inclusion of such items
is not considered to be indicative of the Company's ongoing operating performance.
Unusual operating income/(expense) includes, but may not be limited to: impacts from strategic decisions to rationalize Stellantis' core operations; facility-related costs
stemming from Stellantis' plans to match production capacity and cost structure to market demand, and; convergence and integration costs directly related to significant
acquisitions or mergers.
Industrial Free Cash Flows is calculated as Cash Flows from Operating Activities less: cash flows from operating activities from discontinued operations; cash flows
from operating activities related to financial services, net of eliminations; investments in property, plant and equipment and intangible assets for industrial activities;
contributions of equity to joint ventures and minor acquisitions of consolidated subsidiaries and equity method investments; and adjusted for: net intercompany
payments between continuing operations and discontinued operations; proceeds from disposal of assets and contributions to defined benefit pension plans, net of tax.
The timing of Industrial Free Cash Flows may be affected by the timing of monetization of receivables and the payment of accounts payables, as well as changes in other
components of working capital, which can vary from period to period due to, among other things, cash management initiatives and other factors, some of which may be
outside of the Company's control.
Industrial Net Financial Position is calculated as Debt plus derivative financial liabilities related to industrial activities less: cash and cash equivalents; financial securities
that are considered liquid; current financial receivables from the Company or its jointly controlled financial services entities; and derivative financial assets and collateral
deposits. Therefore, debt, cash and cash equivalents and other financial assets/liabilities pertaining to Stellantis' financial services entities are excluded from the
computation of Industrial Net Financial Position. Industrial Net Financial Position includes the Industrial Net Financial Position Classified as Held for Sale.
July 28, 2022
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