Orano - Annual Activity Report 2024 372 6 STATEMENTS Consolidated financial statements - financial year ended December 31, 2024 NOTE 29 FINANCIAL INSTRUMENTS Orano uses derivatives to manage its exposure to foreign exchange and interest rate risk. These instruments are generally qualified as hedges of assets, liabilities or specific commitments. Orano manages all risks associated with these instruments by centralizing the commitment and implementing procedures setting out the limits and characteristics of the counterparties. Foreign exchange risk Changes in the exchange rate of the US dollar against the euro may affect the group’s income in the medium term. In view of the geographic diversity of its locations and operations, the group is exposed to fluctuations in exchange rates, particularly the euro/US dollar exchange rate. The volatility of exchange rates may impact the group’s currency translation differences, equity and income. Currency translation risk The group does not hedge the currency translation risk resulting from the accounting impact of the conversion into euros in the consolidated financial statements of group subsidiaries that use a currency other than the euro, to the extent that this risk does not result in a flow. Only dividends expected from subsidiaries for the following year are hedged as soon as the amount is known. Financing risk The group finances its subsidiaries in their functional currencies to minimize the foreign exchange risk from financial assets and liabilities issued in foreign currencies. Loans and advances granted to subsidiaries by the centralized Treasury Management Department are then systematically converted into euros through foreign exchange swaps or cross-currency swaps. To limit the foreign exchange risk on long-term investments generating future cash flows in foreign currencies, the group uses a liability in the same currency to offset the asset whenever possible. Transactional risk The principal foreign exchange risk concerns fluctuations in the euro/US dollar exchange rate. The group’s policy, which was approved by the Executive Committee, is to systematically hedge foreign exchange risk generated by sales transactions, whether certain or potential (in the event of hedging during the proposal phase), so as to minimize the impact of exchange rate fluctuations on net income. To hedge transactional foreign exchange risk, including trade receivables and payables, firm off-balance sheet commitments (customer and supplier orders), highly probable future flows (sales or purchasing budgets, projected margins on contracts) and calls for proposals in foreign currencies, Orano purchases derivatives (mainly currency futures) or specific insurance contracts (issued by Coface). These hedging transactions are backed by underlying transactions in identical amounts and maturities and are generally documented and eligible for hedge accounting (excluding possible hedges in the case of calls for proposals submitted in foreign currencies). DERIVATIVES SET UP TO HEDGE FOREIGN EXCHANGE RISK AT DECEMBER 31, 2024 (in millions of euros) Notional amounts by maturity date Total Market value <1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years >5 years Forward exchange transactions and currency swaps 1,691 1,242 787 539 252 4,510 (170) Currency options - - - - - - - - Cross-currency swaps 67 100 100 134 401 16 TOTAL 1,758 1,342 887 673 252 - 4,912 (154) DERIVATIVES SET UP TO HEDGE FOREIGN EXCHANGE RISK AT DECEMBER 31, 2023 (in millions of euros) Notional amounts by maturity date Total Market value <1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years >5 years Forward exchange transactions and currency swaps 2,314 1,362 1,167 693 43 - 5,580 11 Currency options - - - - - - - - Cross-currency swaps 70 70 105 105 140 - 490 8 TOTAL 2,384 1,431 1,272 798 184 - 6,070 19
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