Orano - Annual Activity Report 2025 326 6 FINANCIAL STATEMENTS Consolidated financial statements – financial year ended December 31, 2025 1.3.7 Valuation of intangible and tangible fixed assets 1.3.7.1 Intangible assets An intangible asset is recognized when it is probable that future economic benefits therefrom will accrue to the Company and if the cost of this asset can be reliably estimated based on reasonable and documented assumptions. Intangible assets are recorded at their acquisition or production cost. Goodwill The group applies the amendment to IFRS 3, which entered into force on January 1, 2020, to determine whether an acquisition should be accounted for as a business combination or as an acquisition of isolated asset(s). In accordance with IFRS 3 “Business combinations”, goodwill relating to a business combination represents the difference between: ● on the one hand, the sum of the following items: ● the purchase price for the takeover at fair value at the acquisition date, ● the amount of non-controlling interests in the acquired entity, and ● for step acquisitions, the fair value, at the acquisition date, of the group’s interest in the acquired entity before the acquisition of control; ● on the other hand, the net amount of assets acquired and liabilities assumed, measured at their fair value at the acquisition date. When the resulting difference is negative, it is immediately recognized in profit or loss. The amount of goodwill is definitively set within 12 months of the date of acquisition. Goodwill is allocated to the cash-generating units (CGUs) or group of CGUs in which it is monitored. Goodwill from the acquisition of subsidiaries is presented separately in the statement of financial position. Goodwill is not amortized but is subject to impairment testing whenever indications of loss of value are identified, and at least once a year, as described in 1.3.7.5. After initial recognition, goodwill is recorded at cost less, where applicable, any impairment loss recognized. In the income statement, impairment losses related to goodwill are presented under “Other operating expenses.” Goodwill arising on the acquisition of associates and joint ventures is included in the carrying amount of the interest recorded in the group’s statement of financial position. In the income statement, impairment losses related to this goodwill are recorded under “Share of net income of associates and joint ventures.” When a CGU or part of a CGU is sold, the share of goodwill corresponding to the transferred entity is taken into account in the carrying amount of its net assets used to determine the gain or loss realized. The share of goodwill is measured based on the relative value of the scope transferred within the CGU or group of CGUs. Research and Development expenses Research expenses incurred by the group on its own account are expensed as incurred. Research and Development expenses funded by customers under contracts are included in the production cost of these contracts and recorded under “Cost of sales.” Expenses relating to development projects are recognized as intangible assets if the project meets the following criteria: ● the project is clearly defined, and its costs are identified separately and measured reliably; ● the project’s technical feasibility has been demonstrated; ● it is the group’s intention to complete the project with a view to its use or sale; ● adequate technical and financial resources are available for the completion of the project; and ● it is likely that the future economic benefits associated with the project will accrue to the group. Development costs capitalized on that basis are then amortized over the probable useful life of the intangible asset, as from the commissioning date. They are depreciated on a straight-line basis over a minimum period of time. Mineral exploration and pre-mining development Mineral exploration and pre-mining development work are recognized on the basis of the following rules: ● exploration expenses whose purpose is to identify new mineral resources, and expenses related to assessments and predevelopment of identified deposits are incurred before project profitability is determined and are recognized as “Research and Development expenses” for the financial year; ● pre-mining development expenses that concern a project which, as of the date of the financial statements, has a strong chance of technical success and commercial profitability, are capitalized. Indirect costs, excluding overhead expenses, are included in the valuation of these costs. Capitalized pre-mining expenses are amortized in proportion to the number of metric tons mined from the reserves they helped identify. Other intangible assets Other intangible assets, including mining rights and acquired technology, are measured at acquisition cost or production cost. They are amortized using the most appropriate method in view of their use (straight-line or by units of production), starting on the date they were placed in service and over the shorter of their probable period of use or, when applicable, the duration of their legal protection. 1.3.7.2 Tangible fixed assets Tangible fixed assets are recognized at acquisition or production cost, including startup expenses, less cumulative depreciation, and impairment.
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