the value - KU Leuven · AXA-UAP (4) — 9901.1% ORIOR — 9811.1% TRANSCOR 778 901.0% ACP 580 —0.7% …DITIONS DUPUIS 391 450.5% H…LIO CHARLEROI 187 210.2% OTHERS 421 4 8046.0%

COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE PORTEFEUILEMAATSCHAPPIJ’s long-term objective

is to maximize shareholders’ value. Its shareholders may assess the fulfilment of this goal by following the estimated

value and the dividend per share. This fundamental aspect of NPM/CNP’s corporate charter must be understood by

its shareholders, both institutional and private, whether they hold a controlling or a minority interest.

With regard to its own investments or those controlled indirectly through PARGESA/GBL/PARFINANCE,

NPM/CNP is not limited to any particular sector ; NPM/CNP does however often prefer to locate start-up operations

or projects with a large technological content within its existing holdings, thereby helping them to develop close to

their core business; the same applies to geographical diversification far from home. Even though NPM/CNP may be

induced to take an opportunistic minority shareholding in companies with a European or world dimension and

excellent prospects for capital gains, its primary aim is to obtain controlling interests. The investments NPM/CNP is

looking for must have reached a degree of maturity and sufficient size to ensure total independence in their day-to-

day management. Indeed, although NPM/CNP is sectorially diversified, it intends to concentrate on the functional

exercise of the five basic core “skills” which constitute its professional shareholder activity :

- strategic choices, including the management of risk and the related expected returns,

- approval of investments and disinvestments,

- determination and provision of long-term resources and definition of the dividend policy,

- choice of management and their motivation,

- development of contacts between companies in the Group for their mutual benefit.

Through these activities, NPM/CNP seeks homogeneity between the return on its investments and that expected

by its shareholders.

These different skills are however exercised to varying degrees depending on the percentage of the holding, its

size and the context - a crisis situation, for example - in which it operates; one prerequisite is rigorous reporting and

a reciprocal exchange of information, forming the basis of effective collaboration between NPM/CNP and the compa-

nies in which it has interests.

The role of a shareholder is clearly not the same as that of a manager. The former sets out the objectives in terms

of yields and risks, and the latter administers and implements the operations required to achieve them. The

manager is given great autonomy in order to ensure flexibility and a rapid response. Trust is not incompatible with

control, but this latter must not hinder freedom of action.

NPM/CNP representatives on the various Boards of Directors reconcile their role of both supporting the manage-

ment and acting as a counterweight to them within well accepted corporate governance principles.

npm/cnp : a holding company,a professional shareholder

On 7 April 1998, the BANKING AND FINANCE COMMISSION authorised the use of this document as a reference for any public investment offer which maybe made by COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE PORTEFEUILLEMAATSCHAPPIJ up to the date of publication of its next annual report,under the provisions of Title II of Royal Decree no. 185 of 9 July 1935, under the dissociated information procedure.Under this procedure, this annual report should be accompanied by an operations note in order for it to constitute a prospectus within the meaning of article 29 of Royal Decree no. 185 of 9 July 1935. This prospectus will be submitted for the approval of the BANKING AND FINANCE COMMISSION in accor-dance with article 29ter. §1, 1st sentence of Royal Decree no. 185 of 9 July 1935 and the provisions of the Royal Decree of 13 February 1996.

financial highlightsthe value

Global data(in BEF million)

book equity (restricted consolidation) (1) 357 19 718 32 545 37 363 43 782 44 081 44 605 51 727 51 351 52 589 53 602

book equity (consolidation) (1) n.a. n.a. n.a. 36 678 42 546 42 667 44 239 50 983 50 526 53 486 58 816

estimated value of equity 1 668 28 585 43 286 39 950 48 509 44 109 57 461 59 989 60 833 70 211 87 602(non-diluted)

TSR (2) (yearly) n.s. 34.6% 9.9% –14.2% 10.8% –4.9% 36.0% –3.8% 5.7% 19.6% 28.4%

TSR (2) (cumulated) n.s. 34.6% 14.5% –0.6% 3.4% 1.2% 7.3% 5.3% 5.3% 7.0% 9.2%

1988 1989 1990 1991 1992 1993 1994 1995 1996 1997

Number of shares(,000)

existing shares (non-diluted) 768 12 000 17 500 19 359 22 125 22 125 22 125 25 340 25 340 25 340 25 340

warrants – – – 200 200 200 200 1 700 1 700 1 700 1 700

shares fully diluted 768 12 000 17 500 19 559 22 325 22 325 22 325 27 040 27 040 27 040 27 040

shares entitled to dividend 768 3 261 15 000 18 430 22 125 22 125 22 125 25 340 25 340 25 340 25 340

Data per share (non-adjusted)(in BEF)

estimated value (non-diluted) 2 171 2 382 2 474 2 064 2 193 1 994 2 597 2 367 2 401 2 771 3 457

estimated value (fully diluted) 2 171 2 382 2 474 2 060 2 188 1 991 2 589 2 362 2 393 2 740 3 383

stock market price (high) 2 000 2 245 2 375 2 300 2 060 2 030 2 190 2 210 2 020 2 025 2 870(ordinary share)

(low) 1 305 1 310 2 010 1 820 1 865 1 690 1 740 1 860 1 770 1 750 1 940

(close) 1 950 2 170 2 080 1 990 1 975 1 785 2 120 2 005 1 900 2 000 2 440

discount (close) 10.2% 8.9% 15.9% 3.4% 9.7% 10.3% 18.1% 15.1% 20.6% 27.0% 27.9%

Data per share (adjusted) (3)

(in BEF)

estimated value (fully diluted) 1 851 2 157 2 349 1 960 2 099 1 910 2 483 2 317 2 349 2 712 3 383

stock market price 1 846 2 141 2 080 1 990 1 975 1 785 2 120 2 005 1 900 2 000 2 440

On 31 March 1998, the estimated value of equity (non-diluted) was BEF 97,800 million, i.e. BEF 3,760 per share (fully diluted). The TSRsince 1 January 1998 reaches 11.6% during the quarter. On this same date, the stock maket price was BEF 2,920 per share, showing a 22.3%discount.

1stQ.1988

the results

Global data(in BEF million)

operating income 73 326 1 597 2 054 2 397 2 358 2 401 2 406 2 589 2 616 2 850

capital result 95 17 1 004 303 571 – 28 404 (489) 1 210 807

including transitive amortisation of goodwill – – – (35) – 19 – – – (1) –

net result 168 343 2 601 2 357 2 968 2 358 2 429 2 810 2 100 3 826 3 657

consolidated result

operating income n.a. n.a. n.a. 3 272 3 051 2 562 3 165 3 239 3 604 3 936 4 821

capital result n.a. n.a. n.a. 980 662 (299) (402) 149 (1 240) 1 147 2 878

including transitive amortisation of goodwill n.a. n.a. n.a. (500) (594) (359) (498) (461) (403) (769) (666)

net result n.a. n.a. n.a. 4 252 3 713 2 263 2 763 3 388 2 364 5 083 7 699

dividend

total dividends 60 281 1 301 1 670 2 080 2 080 2 124 2 486 2 552 2 585 2 635

restricted consolidated result

Data per share (adjusted) (3)

(in BEF)

operating income 83.04 87.63 101.16 108.12 105.93 104.23 106.12 94.97 102.17 103.25 112.47

capital result 107.96 4.50 63.61 15.93 25.24 – 1.22 15.94 (19.29) 47.74 31.84

including transitive amortisation of goodwill – – – (1.84) – 0.86 – – – (0.03) –

net result 191.00 92.13 164.77 124.05 131.17 104.23 107.34 110.91 82.88 150.99 144.31

consolidated result

operating income n.a. n.a. n.a. 172.21 134.86 113.23 139.87 127.84 142,24 155. 31 190.24

capital result n.a. n.a. n.a. 51.61 29.25 (13.22) (17.76) 5.86 (48.96) 45.27 113.58

including transitive amortisation of goodwill n.a. n.a. n.a. (26.32) (26.25) (15.86) (22.01) (18.19) (15.91) (30.36) (26.27)

net result n.a. n.a. n.a. 223.82 164.11 100.01 122.12 133.70 93.28 200.58 303.82

dividend

gross dividend (ordinary share) 67.96 71.25 79.81 86.66 91.91 91.91 93.87 98.00 100.00 102.00 104.00

restricted consolidated result

(1) Ex dividend.(2) The Total Shareholders' Return is applicable to the shares and warrants as a whole and does not take into consideration the potential dilution due to the exercise

of the warrants. The shareholders which do not hold warrants realised a TSR of 27,2% in 1997 and 9,0% since April 1988.(3) The data per share have been adjusted with factors based on the estimated value, except for the stock market prices which have been adjusted with factors based

on the stock market price. These factors are mentioned page 109.

1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997

assets and structure (31 December 1997)

PETROFINA

0.8%

ROYALE BELGE

2.4%

0.4%

COMPAGNIE GÉNÉRALE DES EAUX (4)

ELF AQUITAINE

100%

47.6%

28.3%

50.0%

25.0%

11.2%

1.9%

40.5%

0.7%

50.0%

83.1%

25.0%

22.7%

12.9%

54.4%

47.6%

2.1%

6.4%

1.8%

21.7%

20 527 4 03728.0% PARGESA

3 468 2 5146.8%

IMÉTAL– 5 8816.7%

5 799 –6.6%

SOCIÉTÉ GÉNÉRALE DE BELGIQUE5 698 –6.5%

4 316 –4.9%

SUEZ LYONNAISE DES EAUX– 3 2123.7%

CLT-UFA– 1 7472.0%

IJSBOERKE / SUZY1 726 –2.0%

PARIBAS (4)

– 1 5591.8%

COBEPA1 478 –1.7%

BERNHEIM-COMOFI1 057 2271.5%

AXA-UAP (4)

– 9901.1%

ORIOR– 9811.1%

TRANSCOR 778 901.0%

ACP580 –0.7%

ÉDITIONS DUPUIS391 450.5%

HÉLIO CHARLEROI187 210.2%

OTHERS421 4 8046.0%

CASH AND EQUIVALENTS13 219 1 84917.2%

GBL

ELECTRAFINA

PARFINANCE

AUDIOFINA

� % held by NPM/CNP

value (mio BEF)

held directly by NPM/CNP

NPM/CNP’s share in the value (mio BEF) held by PARGESA Group

percentage in the value of NPM/CNP

% held by the PARGESA Group

50% (2)

50.0% (3)

59 645 100.0% 27 957

NPM/CNP (1)

BEF 87 602 million in estimated value

(1) the controlling shareholders of NPM/CNP are described onpage 25

(2) the control structure of the PARGESA/GBL/PARFINANCEGroup is described on page 25

(3) AUDIOFINA holds 50% of CLT-UFA HOLDING, a 98%shareholder of CLT-UFA

(4) shareholdings sold early 1998

stock market and shareholders

1 600

2 000

2 200

2 400

1 800

2 600

3 200

3 400

3 600

3 800

2 800

3 000

0%

30%

20%

10%

19921991199019891988 1993 1994 1995 1996 1997 1998

Share price, estimatedvalue and discount

(unadjusted dataper ordinary share)

Financial instrumentslisted

on the BrusselsStock Exchange

Shareholders’calendar

13 May 1998 Annual General Meetingat 10:00 a.m., at the registered office, 12 rue de la Blanche Borne,6280 Loverval (Belgium).

27 May 1998 Payment of dividends on presentation of coupon nr. 45(subject to the approval of the Annual General Meeting).

6 August 1998 Half-yearly restricted consolidated accounts (30 June 1998) :publication of information after the Board of Directors meeting.

25 September 1998 Half-yearly consolidated accounts (30 June 1998) :publication of information after the Board of Directors meeting.

11 February 1999 Annual restricted consolidated accounts (31 December 1998) :publication of information after the Board of Directors meeting.

1 April 1999 Annual consolidated accounts (31 December 1998) :publication of information after the Board of Directors meeting.

12 May 1999 Annual General Meetingat 10:00 a.m., at the registered office, 12 rue de la Blanche Borne,6280 Loverval (Belgium).

• Ordinary shares (1)

• VVPR shares (1)

• Warrants which can be exercised between 1 and 15 June 1998 and 1999 : 1 warrant + BEF 2,365 = 1 VVPR share

• Bonds category A 94-99 - BEF 50,000 - 6.70%• Bonds category B 94-99 - BEF 2,365 - 5.0625%

Average daily transactions (Brussels Stock Exchange)(number of shares)

ordinary shares

VVPR shares

warrants

total

3 274 4 357 3 705 2 652 1 392 2 539 4 152 1 756 2 720 4 243 24 348

– – – – – – 80 187 190 237 92

– – – – – – 7 433 2 274 3 389 19 168 16 143

3 274 4 357 3 705 2 652 1 392 2 539 11 665 4 217 6 299 23 648 40 583

1st Q.1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

Estimated value (in BEF/share)Stock market price (in BEF/share)Discount

(1) also listed in Luxembourg

The NPM/CNP Group, in addition to its direct

investment activities, also makes indirect

investments through a series of holdings

controlled by PARJOINTCO : PARGESA/

GBL/PARFINANCE and their subsidiaries. It

was within PARJOINTCO that, in 1990, the

Group merged its holding in PARGESA with that

of the POWER CORPORATION OF CANADA

Group, also a family group controlled by Paul

DESMARAIS Sr and his heirs. This alliance

covers PARGESA, its subsidiaries and its

strategic interests, in particular its joint hold-

ings with NPM/CNP (PETROFINA, ROYALE

BELGE, DUPUIS, TRANSCOR and BERNHEIM-

COMOFI) and FIBELPAR (BELGIAN SKY

SHOPS).

1

group structure

FRÈRE-BOURGEOIS

NPM/CNP

FIBELPAR

ERBEPARIBAS

SGBAXA-UAPROYALE BELGEELECTRAFINA

Market

54.5%

57.1%

53.5%

The percentages indicated above are the consolidationpercentages in effect at 31.12.1997; end of March 1998, theFRÈRE-BOURGEOIS Group acquired 31.72% of the share capital ofFIBELPAR from the SGB and ELECTRAFINA Groups.

• FRÈRE-BOURGEOIS is the parent company,

the capital of which is fully owned by the

FRÈRE family.

• ERBE is the interface between the family and

the French PARIBAS Group, its partner for

several decades.

• ERBE holds the majority of the capital of

FIBELPAR together with major institutional

shareholders : the SOCIÉTE GÉNÉRALE DE

BELGIQUE (SGB) Group, AXA-UAP, ROYALE

BELGE and ELECTRAFINA.

• NPM/CNP constitutes the interface with the

Market.

NPM/CNP is the listed entity of the Group commonly known as the “Groupe de Charleroi”.

The latter, controlled by Baron FRÈRE, is made of four sub-groups: FRÈRE-BOURGEOIS, ERBE,

FIBELPAR and NPM/CNP, each with its own financial subsidiaries.

FRÈRE-BOURGEOIS NPM/CNP

AGESCA NEDERLAND/N.F.A.

PARJOINTCO

PARGESA/GBL/PARFINANCEand their financial subsidiaries

SHAREHOLDINGS

POWERGROUP

10.5% Interest Joint 89.5% Interest51% Vote Control 49% Vote

Joint Control50% 50%

54.5% Interest62.1% Vote

2

directors, executive managementand auditors

John DILS, Chairman (2) 09.06.1993 11.06.1997 13.05.1998Gilles SAMYN, Managing Director 22.03.1988 09.06.1993 12.05.1999Jean CLAMON 22.03.1988 08.06.1994 10.05.2000Victor DELLOYE 08.06.1994 – 10.05.2000Pierre-Alain DE SMEDT 11.06.1997 – 14.05.2003Thierry DORMEUIL 08.06.1994 14.06.1995 09.05.2001Jacques FOREST 10.06.1992 12.06.1996 08.05.2002Baron FRÈRE (until 2 April 1998) 18.11.1988 08.06.1994 n.a.Gérald FRÈRE (2) 22.03.1988 14.06.1995 09.05.2001Ségolène FRÈRE (from 2 April 1998) 02.04.1998 – 10.05.2000Jean-Pierre GÉRARD 14.06.1995 – 09.05.2001Philippe HUSTACHE 14.06.1995 – 09.05.2001Marcel NICOLAÏ 12.06.1996 – 13.05.2002Thierry de RUDDER 22.03.1988 08.06.1994 10.05.2000Baron SANTENS 28.03.1989 08.06.1994 10.05.2000Jo SANTINO 10.06.1992 12.06.1996 13.05.2002Gustaaf VAN den BEMPT 22.03.1988 08.06.1994 10.05.2000Philippe WILMES 18.11.1988 08.06.1994 10.05.2000

KLYNVELD PEAT MARWICK GOERDELER 18.11.1988 12.06.1996 12.05.1999Reviseurs d’Entreprises S.C.C.,represented by Georges M. TIMMERMAN

DELOITTE & TOUCHE 18.11.1988 14.06.1995 13.05.1998Reviseurs d’Entreprises S.C.C.,represented by Claude POURBAIX

The terms of office of Mr. John DILS and the auditors DELOITTE & TOUCHE expire at the end of the OrdinaryAnnual General Meeting to be held on 13 May 1998; the AGM will decide whether to renew their terms ofoffice or to appoint others. The co-optation of Miss Ségolène FRÈRE by the Board of Directors on 2 April 1998, replacing Baron FRÈRE who resigned, is subject to approval by the Annual General Meeting.

Gilles SAMYN, ChairmanJean CLAMONLaurent DASSAULTVictor DELLOYEJohn DILSJacques FORESTGérald FRÈRE (2)

Marcel NICOLAÏJo SANTINO

Philippe HUSTACHE, ChairmanJohn DILSMarcel NICOLAÏ

Gérald FRÈRE, ChairmanPierre-Alain DE SMEDTPhilippe WILMES

BoardOf Directors

StatutoryAuditors

Elections

ExecutiveCommittee

AuditCommittee

AppointmentsCommittee

(1) The main functions or mandates of the Directors are shown on page 106 of this report. There are no particular statutory regulations con-cerning the appointment and renewal of Directors’ terms of office. However, unless the Annual General Meeting decides otherwise, the agelimit is traditionally set at 70 years, Directors’ terms of office last for six years and are renewable.

(2) As Mr. John DILS expressed his wish not to continue his duties as Chairman, the Board of Directors has already decided that Mr. GéraldFRÈRE will succeed him at the end of the General Meeting of 13 May 1998. Mr. Gérald FRÈRE will resign from the Executive Committee.

(3) The Auditors’ mandates cover three years and are renewable.

Date of the Latest Expiryfirst term renewal date

(1)

(3)

3

personnel and organisation

MANAGING DIRECTORGilles SAMYN

SECRETARYVictor DELLOYE

SHAREHOLDINGS AND FINANCIAL INFORMATIONRoland BORRESMaximilien de LIMBURG STIRUMÉric TAELEMANSPhilippe THIBAUT

STOCK AND FINANCIAL MARKETSMichel LOIRÉtienne COUGNON

COORDINATION CENTREFernand MIGEOTJean-Charles d’ASPREMONT LYNDENJean-Pierre CAPRONPascal CLAUSEJean-Luc FISCHERJean-Marie LABRASSINEJacques LAMBEAUX

Geneviève PISCAGLIAValérie BARTHOL

Aart COOIMANPieter SCHWENCKE

Georges BETTERMANNCyril DUMITRU Fabienne RUDAZGaël BALLERY

Luxembourg

Netherlands

Switzerland

4

corporate governance

The Board of Directors defines the strategic choices, investment and disinvestment deci-sions and the long-term financing of the Company that are proposed by the Executive Committee.It delegates day-to-day management to a Managing Director who reports regularly on the man-agement and, in particular, on changes in shareholdings and the monitoring of subsidiaries. TheBoard of Directors draws up the accounts, informs the shareholders through the Directors’ reportand appoints the members of the Board Committees (Executive Committee, Audit Committee andthe Appointments Committee).It is composed of 17 Directors distributed as follows :• 2 executive Directors : Gilles SAMYN and Victor DELLOYE.• 9 non-executive Directors representing shareholders : Jean CLAMON, Thierry DORMEUIL,

Jacques FOREST, Baron FRÈRE (until 2 April 1998), Gérald FRÈRE, Ségolène FRÈRE (from 2April 1998), Jean-Pierre GÉRARD, Philippe HUSTACHE, Thierry de RUDDER and Jo SANTINO.

• 6 independent non-executive Directors : John DILS, Pierre-Alain DE SMEDT, Marcel NICOLAÏ,Baron SANTENS, Gustaaf VAN den BEMPT and Philippe WILMES.

During the course of 1997, the Board of Directors met four times. The attendance level at meet-ings was 73.5%.The total amount of emoluments and salaries paid to Directors in 1997 is indicated on page 108.

The Executive Committee, chaired by the Managing Director, analyses, prepares and pro-poses to the Board of Directors the strategic choices, investments and disinvestments, as well asthe long-term financing decisions of the Company.The Executive Committee is made up of 9 persons :• 2 executive Directors : Gilles SAMYN and Victor DELLOYE.• 4 non-executive Directors representing shareholders :

Jean CLAMON, Jacques FOREST, Gérald FRÈRE and Jo SANTINO.• 2 independent non-executive Directors : John DILS and Marcel NICOLAÏ.• 1 non-Director shareholder’s representative : Laurent DASSAULT.During the course of 1997, this Committee met twice.

The Audit Committee assists the Board of Directors with internal control matters, estab-lishing accounts, financial information, the appointment of auditors and relations with them, aswell as with intra-group operations. It meets prior to each Board of Directors meeting in order totake decisions on these matters.The Audit Committee is comprised of 3 persons :• 1 non-executive Director representing a shareholder : Philippe HUSTACHE.• 2 independent non-executive Directors : John DILS and Marcel NICOLAÏ.During the course of 1997, this Committee met four times.

The task of the Appointments Committee is to suggest applicants to Directors’ functionsor to give advice on proposed applications. It may also be called upon by the Board of Directorsfor clarification concerning the remuneration of senior managers of the Company. It is comprised of 3 members :• 1 non-executive Director representing a shareholder : Gérald FRÈRE.• 2 independent non-executive Directors : Pierre-Alain DE SMEDT and Philippe WILMES.

Boardof Directors

ExecutiveCommittee

AuditCommittee

AppointmentsCommittee

(created on 2 April 1998)

5

message to the shareholders

The year 1997 was good for COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE PORTE-

FEUILLEMAATSCHAPPIJ. The estimated value rose from BEF 2,740 to BEF 3,383 per share. Taking

into account the payment of a dividend of BEF 102 in June 1997, the overall return totalled 27.2%.

Over the past ten years (1988-1997) since it became part of the FRÈRE Group, your Company has

seen its value rise from BEF 1.7 billion to BEF 87.6 billion. This growth stems for 42% from the net

increase in your investment in the Company (BEF 52.9 billion in increases in capital less BEF 17.2

billion distributed as dividends) and 58% (BEF 50.2 billion) from rises in the value of the invest-

ments made. Your total return has been 9.2% per annum.

From the point of view of stock market performance, these results have been partially obscured by

an increasing discount which fluctuated over the course of 1997 between 13.7 and 31.3%.

On 31 December 1997, it stood at 27.9%. If we exclude the cash in hand of BEF 13.2 billion, the

discount on shareholdings alone totalled 33.0% at the end of 1997.

NPM/CNP starts 1998 with a balanced portfolio and good quality assets, a.o. in terms of return

and value.

The net asset value of the COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE PORTE-

FEUILLEMAATSCHAPPIJ (BEF 87.6 billion) is currently comprised of five units (apart from tangible

assets which represent 0.4%):

• 31.9% PARGESA/GBL/PARFINANCE, controlled jointly by the FRÈRE-BOURGEOIS/NPM-CNP

Group and the POWER CORPORATION OF CANADA Group belonging to the DESMARAIS

family, currently focused on five main assets: PETROFINA, SUEZ LYONNAISE DES

EAUX, IMÉTAL, CLT-UFA and ROYALE BELGE.

• 23.4% A 6.4 % holding in PETROFINA which, together with the 22.7% held by ELECTRAFINA,

makes the Group a major shareholder, but not a controlling one, in this company which

we believe is undervalued by the market.

• 23.7% Shareholdings in various companies operating on a European scale (COMPAGNIE

GÉNÉRALE DES EAUX – sold early 1998 –, SOCIÉTÉ GÉNÉRALE DE BELGIQUE, ELF

AQUITAINE, ROYALE BELGE and COBEPA).

• 5.5% Major or controlling shareholdings in medium-sized enterprises (IJSBOERKE-SUZY,

BERNHEIM-COMOFI, TRANSCOR, L’ACIDE CARBONIQUE PUR, ÉDITIONS DUPUIS and

HÉLIO CHARLEROI).

• 15.1% In liquid assets, partially invested in stock markets.

Our objective is to develop this portfolio, over time and as opportunities arise, by concentrating

on three categories of assets:

• The PARGESA Group.

• Controlling shareholdings in industrial, commercial or service companies in a limited number of

sectors (agri-food; publishing and communications; etc.).

• Liquid assets (partially invested in stock markets) allowing the Company to seize opportunities

when companies are for sale in the market, and to respond to calls from those in which it already

has or would like to have interests.

6

Our objective is to increase very substantially the proportion of net assets invested in control-

ling interests in medium-sized enterprises (currently 5.5%), and at a future date this category of

assets could represent up to 50% of the value of the Company. This ambitious challenge will not

however be achieved at the expense of the support which we shall continue to give unstintingly to

the PARGESA Group.

Over the past few years NPM/CNP has examined many investment opportunities, either directly or

using companies it already controls as intermediaries, with a view to achieving this objective. Its

substantial liquid assets permit it to continue down this path, but will not tempt it to abandon the

prudence it has always shown in the past.

We have always had a very open attitude to the sectors in which we take an interest, and as

investments are made you will gradually see the emergence of our strategy of sectorial concentra-

tion, as illustrated in the case of agri-food.

Our investments in this sector perfectly illustrate our attitude, based on both strategy and opportu-

nism. At the beginning of 1997, when we acquired the SUZY Group for BEF 277 million, we broke

one of our rules concerning the size of the investment. However, although this opportunity may be

small from a financial point of view, it provided us with a good basis on which to hone our skills. It

was building on precisely this foundation that, during the same year, we acquired IJSBOERKE,

which is currently managed by the same team as SUZY.

Moreover, we are also active in a wide range of sectors such as printing, publishing and energy

trading. Each time, the challenge for the company concerned is to grow to a size that ensures its

long-term competitiveness in its specific environment.

This is illustrated by ÉDITIONS DUPUIS (in which our 50 % holding is valued at only BEF 391

million - although we believe its value to be much greater) which today has 30 % of the French-spea-

king market for cartoon strip publications. As long as this company remains financially viable,

DUPUIS could be considered as being large enough to pursue its internal growth, both in its core

activity and in diversification into complementary areas with which it is familiar, such as the

production of animated cartoon films. Both we and the management are however monitoring deve-

lopments in DUPUIS’ sphere of activities, which could lead to a strategic decision to bring about

external growth.

HÉLIO CHARLEROI will have to expand or further integrate into a major group in a sector

where the best European players are ten times bigger than it. This will also make it easier to over-

come other strategic challenges which it will have to face, primarily in terms of technological deve-

lopments.

TRANSCOR, whose rapid recovery is the fruit of ceaseless efforts, will remain a niche trader

and must therefore react to changes in the market. This is what drove it to launch itself into the first

phase of gas and electricity trading in the United States. In the future we cannot rule out the possi-

bility that TRANSCOR will have to expand size-wise.

7

Dear Shareholders, as you can see, we pay great attention to the strategic aspects of our control-

ling interests in medium-sized enterprises. We are of course exercising the same role, perhaps in a

less visible and direct manner, as for our holdings in much larger enterprises.

Our motivation is and will remain increasing the value of your assets and our objective is

to provide you with a total return appropriate to the risks taken. Our long-term strategy of

concentration, under which we shall continue to actively invest in Europe, does not rule out the

possibility of seizing other opportunities as they arise, which have often been crowned with success

(ELF AQUITAINE, COMPAGNIE GÉNÉRALE DES EAUX or SOCIÉTÉ GÉNÉRALE DE BELGIQUE).

Our prudent overall management of your assets, optimising the risk/return ratio, gives priority

to low risks for the major part of the portfolio, but accepts higher risks on a limited number of acti-

vities within our industrial shareholdings. This should enable us to participate in the success of the

European economy.

Transparency, which has been and remains a key word for the COMPAGNIE NATIONALE À

PORTEFEUILLE/NATIONALE PORTEFEUILLEMAATSCHAPPIJ, only bears fruit if the efforts of the

“sender” of the information are matched by those of the “receiver”. We are at the same time provi-

ding summary information and in-depth analysis, with the first of these forms being the aggregate

of the second. Some Shareholders are satisfied with summary information whilst others wish to

have a deeper understanding of the details.

The number of financial specialists who participate in our information meetings organised in

parallel with the publication of our four press releases (half-yearly and annual restricted consolidated

accounts and consolidated accounts) is rising, and this pleases us. We make it a point of honour to

provide all of our Shareholders with complete and objective information and we are always available

to clarify the information provided.

This annual report is the last one which will be denominated in Belgian francs as our country

is set to take part in the new European monetary system. In the spring of 1999 we shall be using

the euro to present our accounts and management reports for the 1998 financial year. We shall take

the opportunity provided by this major change to introduce a number of other more technical

changes required by developments in our operating environment.

MESSAGE TO THE SHAREHOLDERS

At the end of March 1997, NPM/CNP moved to a new headquarters building in Loverval, in

the green belt on the outskirts of Charleroi. The building, designed by the architect Philippe

SAMYN, seeks not only to achieve an aesthetic appearance, but also to provide an efficient working

environment conducive to team work, exchanges and reflection. It is at the leading edge of computer

and communication technology, allowing everyone to work more efficiently and as part of the overall

team in perfect harmony whilst remaining open to the outside world.

In its meeting of 2 April 1998, the Board of Directors took note of the resignation of

Baron FRÈRE from his position as Director, almost 10 years to the day after NPM/CNP was taken

over by his family Group. It was with great regret that the Board took leave of such an emblematic

figure. However, the Board knows that it will continue to benefit from Baron FRÈRE's opinions and

advice and is grateful to him for having proposed his daughter Ségolène as his successor. The Board

warmly thanked Baron FRÈRE for his numerous initiatives that have proved to be so valuable for the

Shareholders.

The Board of Directors of the COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE

PORTEFEUILLEMAATSCHAPPIJ has decided to create an Appointments Committee. As from

13 May, Mr. Gérald FRÈRE, representing our controlling shareholder, will chair the Board of

Directors, the Board also believed it to be desirable to appoint him as Chairman of this new

Committee.

We consider that the corporate governance of NPM/CNP is and always has been adequate.

The structure of its controlling shareholding, made up of a chain of companies, needed clear rules.

Indeed, this structure, at many levels, has called upon the capital of partners and minority share-

holders. In the mid-eighties the FRÈRE Group therefore drew up a code of conduct at its own initia-

tive. We believe it is regrettable that certain observers use the forums to which they are invited to

make very subjective, and often rather ill-informed, negative comments regarding holding compa-

nies from the point of view of corporate governance. On the contrary, these groups are one of the

main driving forces.

We would like to conclude this message by thanking you for your loyalty and for the trust you

have placed in the team that manages your value.

8

Gilles SAMYN John DILS

Managing Director Chairman of the Board of Directors

directors’ report

MAIN EVENTS IN 1997 AND THE FIRST MONTHS OF 1998

DIRECTINVESTMENTS

PARJOINTCOACTIVITIES

In 1997, the portfolio of investments directly held by the COMPAGNIE NATIONALE À PORTE-

FEUILLE/NATIONALE PORTEFEUILLEMAATSCHAPPIJ underwent the following modifications:

• Sale by the NPM/CNP Group of 296,695 shares in ELF AQUITAINE (capital gain of BEF 399

million), 288,174 COBEPA shares (capital gain of BEF 150 million), 47,575 ROYALE BELGE shares

(capital gain of BEF 136 million) and 8,394 shares in the SOCIÉTÉ GÉNÉRALE DE BELGIQUE

(capital gain of BEF 8 million).

• Selling out of the balance of shares held in ESPIRITO SANTO FINANCIAL HOLDING, resulting in

a write-back of BEF 40 million and a capital gain of BEF 50 million.

• Further disengagement from ARTEMIS; the 262,307 shares still in our hands on 31 December

1997 were reclassified as liquid investments (book value of around BEF 205 million).

• Acquisition, during the course of 1997, of 100% of the capital of the SUZY Group, operating in the

biscuit-making and waffle sector, for a total of BEF 77 million plus shareholder advances of

BEF 200 million, as well as 100% of the IJSBOERKE Group (ice cream) for a sum of approximately

BEF 1,450 million. These two groups will be placed under a common management team.

On 2 April 1998, a subsidiary of NPM/CNP expressed an interest in buying up to 10% of the share

capital of FIBELPAR S.A., controlling shareholder of NPM/CNP, after FRÈRE-BOURGEOIS bought

31.72% of the capital of FIBELPAR from AG 1824, ELECTRAFINA, FINOUTREMER, SOCIÉTÉ

GÉNÉRALE DE BELGIQUE and TRACTBEL. The shareholders will be informed of the realisation

and the conditions of this possible transaction.

During the months of March and April 1998, NPM/CNP has sold its shareholding in COMPAGNIE

GÉNÉRALE DES EAUX on the market, resulting in a capital gain of around BEF 3 billion.

PARJOINTCO N.V. was established in 1990 as a joint venture between FRÈRE-

BOURGEOIS/NPM-CNP Group and POWER CORPORATION OF CANADA on the basis of equal

ownership and management. This provides a vehicle for joint control of PARGESA/GBL/

PARFINANCE, through an agreement binding the parties until the year 2014.

On 31 December 1997, PARJOINTCO held 55% of the capital (representing 62.4% of the voting

rights) of PARGESA, and consolidated 54.5% (62.1% of the voting rights). In 1997 PARJOINTCO paid

a dividend of NLG 86 million, equivalent to the dividend received on PARGESA shares.

9

In June 1997, PARGESA exercised its GROUPE BRUXELLES LAMBERT warrants, thereby

increasing the equity capital of GBL by more than BEF 3 billion; on 31 December 1997, PARGESA

held around 49% of its Belgian subsidiary. During the year PARGESA increased its holding in ORIOR

HOLDING from 74.1% to 83.1%.

In 1997 the GROUPE BRUXELLES LAMBERT proceeded with the sale of its holding in the GIB

GROUP and, at the beginning of 1998, sold its interest in DEWAAY and the BANQUE PARIBAS

BELGIQUE. At the end of 1997, GBL also responded favourably to the public offer of exchange made

by ING on the BANQUE BRUXELLES LAMBERT shares, thus generating a capital gain of BEF 13.9

billion; the transitive share of NPM/CNP in this company, which exceeded BEF 1.6 billion, was

posted in the consolidated capital income. The ING shares obtained in exchange increased the

Group’s treasury investments; almost half of these have been sold in the market during the first

quarter of 1998 with a BEF 3.5 billion profit. In December 1997, GBL converted 330,000 ELEC-

TRAFINA bonds redeemable into shares, giving it a 48.4% holding in its capital. At the beginning

of 1998, GBL increased its holding in this company to over 50%.

Following the merging of the audio-visual interests of the AUDIOFINA and BERTELSMANN

Groups in CLT-UFA, AUDIOFINA had to sell off 16.7% of the company to BERTELSMANN for a sum

of around BEF 32 billion in order to balance the holdings of the two shareholders. The share of the

capital gain reverting to NPM/CNP on this occasion totalled BEF 563 million. Furthermore,

ELECTRAFINA exchanged with the HAVAS Group the latter’s 40% holding in CLMM for AUDIOFINA

shares.

Early 1998, AUDIOFINA has sold its entire holding in HAVAS, booking a BEF 1.5 billion capital gain

(about BEF 45 million for NPM/CNP’s share).

AMERICAN COMETRA, a subsidiary of ELECTRAFINA, sold some petroleum shares, realising

a capital gain over the year of more than BEF 6.6 billion (the NPM/CNP share of the capital gain

totalled BEF 371 million).

During 1997, a year which saw the pooling of the interests of the COMPAGNIE DE SUEZ and the

LYONNAISE DES EAUX, the ELECTRAFINA Group raised its stake in the new merged entity, with

a holding of 11.2% of the capital of SUEZ LYONNAISE DES EAUX at the end of the year, represen-

ting almost 10% of the voting rights of the company.

In 1997, PARFINANCE sold 936,178 PARIBAS shares and 434,866 AXA-UAP shares; the largest

part of these transactions was concomitant with the buy-back of 16.7% of the capital owned by

minority shareholders in the SOPARINVEST subsidiary. Early 1998, PARFINANCE finished to disin-

vest from PARIBAS and AXA-UAP, booking a FRF 972 million gross profit.

On 26 March 1998, PARFINANCE and IMÉTAL have announced their intention to merge, subject to

the approval by both their General Meetings.

10

PARGESA/GBL/PARFINANCE GROUP

DIRECTORS’ REPORT

MAJORDEVELOPMENTS

AT THE LEVEL OFEQUITY-ACCOUNTED

COMPANIES

11

The Group does of course support investments made by equity-accounted companies and plays

an active role in their choice. The main investments and disinvestments carried out by these compa-

nies are as follows:

• The investments made in 1997 by PETROFINA amounted to BEF 43.7 billion compared with

BEF 33.1 billion in 1996. In the upstream sector, they supported the new developments of

EKOFISK, the North Sea and North America as well as the exploration efforts. In the downstream

sector, the investments concentrated on the strengthening of the gas stations network. In the

chemical sector, the Group invested in the increase of its polymers’ production capacity in the

USA.

• IMÉTAL actively pursued its internal and external growth policy, making industrial investments

to the value of FRF 800 million and acquiring shareholdings with a value of FRF 700 million. The

most significant of these were FERRUM, the leading Canadian firm in the mechanical and struc-

tural tube market, and NORD KAOLIN, which increases the reserves and the capacity of DRY

BRANK KAOLIN in Georgia.

• At the end of 1997, ROYALE BELGE responded positively to the public share exchange offer by

ING with BBL, realising a profit of more than BEF 14 billion; the transitive share of NPM/CNP in

this deal totalled BEF 422 million.

• The investments by CLT-UFA in the form of start-up losses totalled some BEF 6.5 billion, mainly

in relation to the PREMIERE, TPS and CHANNEL 5 projects. At the beginning of 1998, CLT-UFA

sold its holding in TPS to other shareholders.

• After having withdrawn from the Berlin project and having sold the building developed in

Budapest, BERNHEIM-COMOFI pursued its promotion activities in this city, as well as in its tradi-

tional markets, Brussels and the surrounding area. INTERPARKING continued to grow and now

manages more than 102,000 parking places in Europe. The expansion of the self-storage business

continued with the opening of a site in Düsseldorf and the purchase of four units in Paris.

• TRANSCOR has expanded its coal and coke business by creating a north-American subsidiary and

a German subsidiary specialised in trading and marketing coal; the Group also decided in early

1998 to start trading in gas and electricity, initially in the north-American market.

• ÉDITIONS DUPUIS, which now owns 100% of MEDIATOON (50% of which was previously held

by ASTRAL), is continuing to develop this subsidiary which is making substantial audio-visual

investments in the production of animated cartoon films (FLASH GORDON, PAPYRUS, etc.).

• In order to reduce its dependence in terms of supplies, ACP has set up a new CO2 production unit

in Tertre which will be operational as from spring 1998.

• Following the acquisition of 100% of TRAITEUR SEILER, a company which manufactures fresh

pasta, the ORIOR Group strengthened its existing holdings by increasing its shareholding in

TRINCA from 60% to 100%, and buying up an additional 20% of the capital of FREDAG, bringing

its holding up to 88%.

• At the beginning of 1998, SUZY, together with MILCAMPS FOODS – one of its main competitors–

set up a joint venture to run combined waffel production operations and the marketing of retai-

lers’ own brands products.

12

On 31 December 1997, net available short-term funds directly held by the NPM/CNP Group

(that is COMPAGNIE NATIONALE À PORTEFEUILLE / NATIONALE PORTEFEUILLE-

MAATSCHAPPIJ, its Swiss financial branch in Geneva and its restricted consolidated financial

subsidiaries) totalled an estimated BEF 13.3 billion (BEF 12.5 billion book value) before distribution

of the dividend (compared with BEF 12 billion a year earlier and a figure in the order of BEF 13

billion on average for 1997 as a whole). During this period, approximately a third of this amount was

invested in shares on a short-term basis. In 1997 the NPM/CNP Group realised a profit on treasury

shares – net of losses and write-offs – of BEF 555 million (compared with BEF 313 million in 1996).

In total, 1997 income from treasury management including the items mentioned above and net

interests and financial income, was posted at BEF 858 million in the restricted consolidated

accounts. In financial terms, taking into account the evolution of unrealised gains (BEF 813 million

at 31 December 1997 compared with BEF 348 million one year earlier), the company obtained a

return of 10.3% on its treasury operations.

The Board of Directors of NPM/CNP has authorised the use of derivatives, within strict limits,

in order to increase the profitability of its financial asset portfolio. This may lead to your Company

issuing options of two types, as opportunities arise, in order to collect the corresponding premiums:

• covered call options – representing commitments to sell – issued exclusively on securities held by

the Company at a price that would result in a profit if the option was exercised.

• put options – that is commitments to buy – on strategic securities that the Company is willing to

acquire.

In 1997, premium collected, net of their eventual purchase, totalled around BEF 3 million; a

single minor operation was still outstanding at 31 December 1997.

Over the year, 56,270 own shares were acquired for a total sum of BEF 135 million, whilst

124,974 shares were sold on the stock market, enabling the Group to realise a profit of some

BEF 113 million. On 31 December 1997, the NPM/CNP Group held 411,165 shares in the

COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE PORTEFEUILLEMAATSCHAPPIJ with

a value of BEF 747 million posted to the asset side of the balance sheet under the heading of “short-

term investments – own shares”.

USE OF DERIVATIVES

OWN SHARES

TREASURYMANAGEMENT

13

ESTIMATED VALUE AND TOTAL SHAREHOLDERS’ RETURN

METHOD USED TOCALCULATE THE

ESTIMATED VALUE

WEEKLYNOTIFICATION OF

ESTIMATED VALUE

The estimated value of your Company at the end of 1997 was BEF 87,602 million (equivalent

to BEF 3,383 per share, fully diluted, that is after taking into account the diluting effect of

outstanding warrants), after payment in June 1997 of gross dividends to the value of BEF 2,585

million (BEF 102 per ordinary share), compared with BEF 70,211 million (BEF 2,740 per share, fully

diluted) one year earlier.

At the end of March 1998, the estimated value was approximately BEF 3,760 per share, fully

diluted.

In determining the estimated value, COMPAGNIE NATIONALE À PORTEFEUILLE/

NATIONALE PORTEFEUILLEMAATSCHAPPIJ attempts to be both prudent and objective. The

following criteria are used depending on the various types of asset:

(1) Acquisition price less any amortisation or write-down.(2) CLT-UFA’s value is nevertheless inferred from AUDIOFINA’s market price.

Type of asset Valuation criteria

Financial investments• Holding companies controlled alone or

jointly• Other listed companies• Other non-listed companies

Tangible fixed assets

Monetary assets and liabilities• Own shares• Other listed assets• Deposits, liquid assets and debts

• Estimated value based on the same criteria asthose applied by NPM/CNP

• Stock market price• Book value (1) or share of shareholders’ equity,

whichever is higher (2)

• Book value (1)

• Stock market price• Stock market price• Book value (1)

The diluting effects of exercising outstanding warrants is taken into account in determining the

estimated value per share as soon as these warrants are “in the money” compared with the esti-

mated value.

For the sake of transparency, COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE

PORTEFEUILLEMAATSCHAPPIJ publishes the estimated value of its shares each week in the

Saturday edition of two Belgian financial newspapers (L’ÉCHO and DE FINANCIEEL ECONOMISCHE

TIJD) ; it is also available on the Company’s Internet site (http://www.cnp.be or www.npm.be) on

Friday evening.

This weekly estimated value is determined applying the criteria described above. However, a few

simplifying assumptions are made: modifications made to the portfolio and to the earnings which

have accumulated since the last publication of accounts may not be taken into account if the combi-

nation of these factors has an effect of less than 1% on the estimated value.

DIRECTORS’ REPORT

14

estimated value in mio bef

31-dec-96

criteria breakdown % shareholders value interest criteria breakdown %

(1) (2) (3) (4) (5) (1) (6)

variation 31-dec-97

PARGESA ev 23 373 33.3% 4 583 – ev 27 957 31.9%PETROFINA sm 15 161 21.6% 5 366 – sm 20 527 23.4%COMPAGNIE GÉNÉRALE DES EAUX sm 4 384 6.2% 1 414 – sm 5 799 6.6%SOCIÉTÉ GÉNÉRALE DE BELGIQUE sm 4 206 6.0% 1 509 (17) sm 5 698 6.5%ELF AQUITAINE sm 3 744 5.3% 1 305 (733) sm 4 316 4.9%ROYALE BELGE sm 2 465 3.5% 1 223 (220) sm 3 468 4.0%IJSBOERKE / SUZY – – – 1 726 bv 1 726 2.0%COBEPA sm 1 406 2.0% 354 (281) sm 1 478 1.7%BERNHEIM-COMOFI sm 1 083 1.5% (26) – sm 1 057 1.2%TRANSCOR se 681 1.0% 97 – se 778 0.9%ACP bv 580 0.8% – – bv 580 0.7%ÉDITIONS DUPUIS se 381 0.5% 11 – se 391 0.4%HÉLIO CHARLEROI se 157 0.2% 30 – se 187 0.2%ARTEMIS sm 234 0.3% – (234) – –ESFH sm 110 0.2% – (110) – –SCI & ASSOCIÉS – – – – – –OTHER SHAREHOLDINGS bv 125 0.2% (4) (46) bv 75 0.1%TANGIBLE FIXED ASSETS bv 221 0.3% – 126 bv 346 0.4%

Long-term assets 58 309 83.0% 15 863 211 74 383 84.9%

DEPOSITS, CASH AND DEBT bv 7 253 10.3% (2 585) 3 657 1 125 bv 9 451 10.8%OWN SHARES sm 960 1.4% – 169 (125) sm 1 003 1.1%SHARES AND BONDS sm 3 689 5.3% – 288 (1 212) sm 2 765 3.2%

Treasury (net) 11 902 17.0% (2 585) 4 113 (211) 13 219 15.1%

Estimated value (non-diluted) 70 211 (2 585) 19 976 – 87 602

Potential exercise of warrants 3 887 3 887

Estimated value (fully diluted) 74 098 (2 585) 19 976 – 91 489

Estimated value (BEF/share) 2 740 3 383

(1) valuation criteriaa) ev : estimated valueb) sm: stock market pricec) se : shareholders' equityd) bv : book value

(2) estimated value at 31.12.1996(3) flows with the shareholders : dividends for BEF 2,585 million(4) value creation without effect on the profit & loss account(5) internal allocation of funds: investments and divestments at book value(6) estimated value at 31.12.1997 = (2) + (3) + (4) + (5)(7) value creation with effect on the profit & loss account: dividends, interests and profit and losses on short-term investments(8) value creation with effect on the profit & loss account: capital gains and losses(9) result without effect on the estimated value: write-downs and reversals of write-downs

(10) total result (Group) = (7) + (8) + (9)(11) total value created: (4) + (7) + (8)(12) Total Shareholders' Return over the period: (11)/(2)

VALUE CREATION AND TOTAL SHAREHOLDERS’ RETURNIN 1997

Assets

15

DIRECTORS’ REPORT

restricted consolidated result (group) in mio bef

with effect on value without effect

totalvalue

created

totalassets

tsr

mio BEF %(7) (8) (9) (10) (11) (12)

operating capital capital

705 – – 705 PARGESA 5 289 22.6%600 – – 600 PETROFINA 5 967 39.4%93 – – 93 COMPAGNIE GÉNÉRALE DES EAUX 1 507 34.4%

195 8 – 203 SOCIÉTÉ GÉNÉRALE DE BELGIQUE 1 712 40.7%117 399 – 516 ELF AQUITAINE 1 821 48.6%118 136 – 254 ROYALE BELGE 1 477 59.9%

6 – – 6 IJSBOERKE / SUZY 6 n.s.87 150 – 237 COBEPA 591 42.0%64 – – 64 BERNHEIM-COMOFI 38 3.6%69 – – 69 TRANSCOR 166 24.4%28 – – 28 ACP 28 4.9%38 – – 38 ÉDITIONS DUPUIS 48 12.6%5 – – 5 HÉLIO CHARLEROI 35 22.2%- 8 – 8 ARTEMIS 8 3.3%6 90 – 95 ESFH 95 87.0%- 49 – 49 SCI & ASSOCIÉS 49 n.s.7 – – 7 OTHER SHAREHOLDINGS 3 n.s.– – – – TANGIBLE FIXED ASSETS – n.s.

2 138 839 – 2 978 Long-term assets 18 840 32.3%

262 – – 262 DEPOSITS, CASH AND DEBT 262113 – – 113 OWN SHARES 281501 – – 501 SHARES AND BONDS 789

876 – – 876 Treasury (net) 1 333 10.3%

(164) (33) – (197) Other revenues/(costs) (197)

3 657 – 3 657 Restricted consolidated result 19 976 28.4%

27.2%

OPINION OF THE STATUTORY AUDITORS ON THE ESTIMATED VALUE

To the Shareholders of COMPAGNIE NATIONALE À PORTEFEUILLE/NATIONALE PORTEFEUILLEMAATSCHAPPIJ,

We have examined the calculation of the estimated value per share of NPM/CNP as of 31 December 1997.

This calculation was made by NPM/CNP based on its shareholders’ equity, that of the holding companies controlled alone or jointly, andthe assets held in their respective portfolios, the latter being valued according to the criteria described on page 13.

In conclusion, we confirm that the use of these criteria produces a value of BEF 3,383 per NPM/CNP share cum dividend at31 December 1997.

3 April 1998

The Statutory AuditorsKPMG DELOITTE & TOUCHEReviseurs d’Entreprises S.C.C. Reviseurs d’Entreprises S.C.C.Represented by Georges M TIMMERMAN Represented by Claude POURBAIX

16

estimated value in mio bef

1-apr-88

criteria breakdown % shareholders value interest criteria breakdown %

(1) (2) (3) (4) (5) (1) (6)

variation 31-dec-97

PARGESA – – 13 996 13 961 ev 27 957 31.9%PETROFINA sm 534 32.0% 2 012 17 982 sm 20 527 23.4%COMPAGNIE GÉNÉRALE DES EAUX – – 2 169 3 630 sm 5 799 6.6%SOCIÉTÉ GÉNÉRALE DE BELGIQUE – – 2 336 3 362 sm 5 698 6.5%ELF AQUITAINE – – 1 845 2 470 sm 4 316 4.9%ROYALE BELGE – – 1 946 1 521 sm 3 468 4.0%IJSBOERKE / SUZY – – – 1 726 bv 1 726 2.0%COBEPA – – 621 857 sm 1 478 1.7%BERNHEIM-COMOFI – – 136 921 sm 1 057 1.2%TRANSCOR – – 452 326 se 778 0.9%ACP – – – 580 bv 580 0.7%ÉDITIONS DUPUIS – – 168 223 se 391 0.4%HÉLIO CHARLEROI – – 109 78 se 187 0.2%NON-LISTED COMPANIES SOLD ev 564 33.8% (528) (36) – –LISTED COMPANIES SOLD sm 388 23.3% (1 847) 1 459 – –OTHER SHAREHOLDINGS – – (22) 98 bv 75 0.1%TANGIBLE FIXED ASSETS – – – 346 bv 346 0.4%

Long-term assets 1 486 89.1% 23 395 49 502 74 383 84.9%

DEPOSITS, CASH AND DEBT bv 182 10.9% 35 662 26 076 (52 469) bv 9 451 10.8%OWN SHARES – – 256 747 sm 1 003 1.1%SHARES AND BONDS – – 546 2 220 sm 2 765 3.2%

Treasury (net) 182 10.9% 35 662 26 877 (49 502) 13 219 15.1%

Estimated value (non-diluted) 1 668 35 662 50 273 – 87 602

Potential exercise of warrants – 3 887

Estimated value (fully diluted) 1 668 35 662 50 273 – 91 489

Estimated value (BEF/share) 2 171 3 383

(1) valuation criteriaa) ev : estimated valueb) sm: stock market pricec) se : shareholders' equityd) bv : book value

(2) estimated value at 01.04.1988(3) flows with the shareholders: capital increases (BEF 52,880 million) less dividends (BEF 17,218 million)(4) value creation without effect on the profit & loss account(5) internal allocation of funds: investments and divestments at book value(6) estimated value at 31.12.1997 = (2) + (3) + (4) + (5)(7) value creation with effect on the profit & loss account: dividends, interests and profit and losses on short-term investments(8) value creation with effect on the profit & loss account: capital gains and losses(9) result without effect on the estimated value: write-downs and reversals of write-downs

(10) total result (Group) = (7) + (8) + (9)(11) total value created: (4) + (7) + (8)(12) Total Shareholders' Return over the period

VALUE CREATION AND TOTAL SHAREHOLDERS’ RETURNFROM 1988 TO 1997

Assets

17

DIRECTORS’ REPORT

restricted consolidated result (group) in mio bef

with effect on value without effect

totalvalue

created

totalassets

tsr

mio BEF %(7) (8) (9) (10) (11) (12)

operating capital capital

4 718 40 – 4 758 PARGESA 18 754 12.8%5 350 447 – 5 797 PETROFINA 7 809 4.7%

286 – – 286 COMPAGNIE GÉNÉRALE DES EAUX 2 455 14.1%1 335 92 – 1 427 SOCIÉTÉ GÉNÉRALE DE BELGIQUE 3 764 13.7%

499 399 – 898 ELF AQUITAINE 2 744 20.9%779 225 – 1 004 ROYALE BELGE 2 951 12.0%

6 – – 6 IJSBOERKE / SUZY 6 n.s.488 150 – 638 COBEPA 1 259 9.5%427 – – 427 BERNHEIM-COMOFI 563 6.9%523 – – 523 TRANSCOR 975 23.6%75 417 – 491 ACP 491 10.6%83 – – 83 ÉDITIONS DUPUIS 252 20.0%21 – – 21 HÉLIO CHARLEROI 130 25.6%

503 1 922 – 2 425 NON-LISTED COMPANIES SOLD 1 897 16.1%1 485 1 932 (616) 2 800 LISTED COMPANIES SOLD 1 570 4.5%

8 1 (10) (1) OTHER SHAREHOLDINGS (13) n.s.– (1) – (1) TANGIBLE FIXED ASSETS (1) n.s.

16 587 5 624 (626) 21 584 Long-term assets 45 606 9.2%

3 175 – – 3 175 DEPOSITS, CASH AND DEBT 3 175113 – – 113 OWN SHARES 369

3 020 – – 3 020 SHARES AND BONDS 3 566

6 307 – – 6 307 Treasury (net) 7 109

(1 286) (1 156) – (2 442) Other revenues/(costs) (2 442)

26 076 (626) 25 449 Restricted consolidated result 50 273 9.2%

9.0%

18

1996 199719951994199319921991199019891988

10 000

20 000

30 000

40 000

50 000

60 000

70 000

80 000

90 000ESTIMATED VALUEOF EQUITY(in BEF million)

Estimated value Dividends

Capital increases

Value created

DIRECTORS’ REPORT

0

200

400

600

800

1 000

1 200

1 400

1 600

1 800

2 000

2 200

2 400

2 600

2 800

3 000

3 200

3 400

2 47

4

2 06

0

2 18

8

1 99

1

2 59

8

2 38

2

287

1 528

379

105

257

9568

664

2 36

2

2 74

0

2 39

3

3 38

3

88 92919089 93 94 95 96 97

28.0%

6.6%

4.9%

3.7%

1.0%6.5%1.7%

1.8%

6.8%

1.5%1.1%

6.7%

0.7%0.2%2.0%1.1%2.0%0.5%

19.6%

1997

25.8%

6.2%

5.3%

1.1%1.1%

6.0%2.0%5.7%

1.9%1.6%

2.7%

1.2%

8.2%

0.8%0.2%

3.7%

1.5%

19.7%

0.6%0.3%

1996

PETROFINA GÉNÉRALE DES EAUX ELF AQUITAINE SUEZ LYONNAISE DES EAUX TRANSCOR

SGB COBEPA

ROYALE BELGE BBL PARIBAS BERNHEIM-COMOFI AXA-UAP

IJSBOERKE/SUZY ORIOR HOLDING

IMÉTAL ACP HÉLIO CHARLEROI

CLT-UFA ÉDITIONS DUPUIS ARTEMIS

ANALYTICALBREAKDOWN

(BEF/share non adjusted)

Cash and equivalents

Energy and utilities

Holding companies

Banking, insurance and real estate

Industry

Agri-food

Audio-visual, culture and leisure

Other sectors

ANALYTICALBREAKDOWN

OTHERSCASH AND EQUIVALENTS

19

20

RESULTS

Restricted consolidated earnings were BEF 3,657 million (BEF 144.31 per share) in 1997

compared with BEF 3,826 million (BEF 150.99 per share) for the previous year. Total consolidated

income in 1997 totalled BEF 7,699 million (BEF 303.82 per share) compared with BEF 5,083 million

(BEF 200.58 per share) in 1996.

Under restricted consolidation, operating income is up by 9% to BEF 2,850 million (BEF 112.47

per share) compared with BEF 2,616 million (BEF 103.25 per share) in 1996, under the combined

effects of the good flow of revenues from financial investments (+12% on an unchanged portfolio) and

profits generated by the portfolio of shares held as liquid investments (BEF 555 million compared

with BEF 313 million during the previous year). A detailed analysis of the yield on all cash holdings

is given on page 12 of this report.

-50

-25

0

25

50

75

100

125

150

175

200

225

250

275

300

325

199719961995199419931992 199719961995199419931992

Gross dividendCapital result

Net resultOperating income

restricted consolidated consolidated(in BEF/share)

21

DIRECTORS’ REPORT

(1) After reallocation of the contribution from operating companies accounted using the equity method by PARGESA and the holdingcompanies controlled by it.

(2) Shareholding for which the entire earnings have been taken into account in 1997 as the exchange against ING shares only took place atthe end of the year.

(3) Shareholdings sold in 1996.

The consolidated operating income rose more steeply (+ 22%) to BEF 4,821 million compared

with BEF 3,936 million in 1996 (BEF 190.24 per share compared with BEF 155.31) under the effects

of the good performance of most industrial and commercial companies accounted for using the

equity method.

The contribution of the various components of operating earnings can be broken down as follows

(in BEF million):

It should be noted that the SUZY Group has been brought within the consolidation perimeter.

The IJSBOERKE Group, acquired at the end of 1997, will not contribute to earnings until 1998.

ConsolidatedDirect Transitive

contribution contribution (1)

1996 1997 1996 1997 1996 1997

990 1 210 INTEGRATED HOLDING COMPANIES 990 1 210 990 1 210708 705 PARGESA and controlled holdings 1 308 1 392 82 239

– 28 ACP 53 73 53 73– – BBL (2) – – 149 172

64 64 BERNHEIM-COMOFI (37) 69 (45) 84– – CLT-UFA – – 87 (38)

12 38 ÉDITIONS DUPUIS 38 49 42 558 5 HÉLIO CHARLEROI 28 47 31 52– – IMÉTAL – – 310 324

528 600 PETROFINA 1 021 1 414 1 222 1 69698 118 ROYALE BELGE 265 416 452 740

184 – SCI & ASSOCIÉS (3) 184 – 184 –– 6 SUZY – 46 – 46– – TRACTEBEL (3) – – 88 –

24 69 TRANSCOR 83 103 93 115– 7 Others 3 2 198 53

918 935 Equity-accounted companies 1 638 2 219 2 864 3 3722 616 2 850 OPERATING INCOME 3 936 4 821 3 936 4 821

Restrictedconsolidated

22

It should also be noted that until now NPM/CNP posts results from industrial and commercial

companies accounted using the equity method as operating income. Such income does however

sometimes contain non-recurring items; for ROYALE BELGE, the profit realised on the BBL/ING

exchange contributes to the operating income of NPM/CNP to the tune of BEF 422 million (transi-

tively) in 1997 (BEF 234 million directly) and the gain on the sale of TRACTEBEL in 1996 to the

value of BEF 172 million (BEF 99 million directly).

Excluding these non-recurring items, the operating income would have risen by 17% to BEF 4,399

million (BEF 173.59 per share) in 1997 compared with BEF 3,764 million (BEF 148.51 per share)

in 1996.

The 1997 earnings were influenced by capital results of BEF 2,878 million, or BEF 113.58 per

share consolidated and BEF 807 million or BEF 31.84 per share restricted consolidated, resulting

from the following items :

(1) including BEF 278 million of exceptional amortisation associated with the capital gains on CLT and BBL.

Restricted Consolidationconsolidation (transitively)

Mio BEF BEF/share Mio BEF BEF/share

Capital gains and losses• BBL – – 1 629 64.30• CLT – – 563 22.24• ELF AQUITAINE 399 15.75 399 15.75• AMERICAN COMETRA – – 371 14.65• COBEPA 150 5.91 150 5.91• ROYALE BELGE 136 5.36 112 4.44• GIB GROUP – – 95 3.73• ESPIRITO SANTO FINANCIAL HOLDING 50 1.97 50 1.97• SCI & ASSOCIÉS 49 1.93 49 1.93• Others 16 0.63 177 6.98

Write-downs and write-backs• ESPIRITO SANTO FINANCIAL HOLDING 40 1.57 40 1.57• Others – – (59) (2.35)

Amortisation of goodwill (1) – – (666) (26.27)

Other capital results (33) (1.28) (32) (1.27)

Total 807 31.84 2 878 113.58

23

On a restricted consolidated basis, the dividends distributed in 1998 by the companies in

which NPM/CNP has a holding will generally be higher than those for 1997. It is, however, prema-

ture to announce the income that will be derived from short-term investments, given the impact of

changes in interest rates and the behaviour of the stock markets.

The consolidated accounts, which will also be influenced by the financial markets, will depend on

the economic situation in the sectors in which the COMPAGNIE NATIONALE À PORTE-

FEUILLE/NATIONALE PORTEFEUILLEMAATSCHAPPIJ operates through the intermediary of

companies accounted for by the equity method.

In the absence of any major economic or stock market event, NPM/CNP intends to continue with its

current dividend policy in 1998.

PROSPECTS

LEGAL NOTICE

Pursuant to article 64ter of the Coordinated Laws on Commercial Companies, the Board of

Directors informs you that DELOITTE & TOUCHE, Statutory Auditor of the Company, received a

special fee in 1997 of BEF 346,000 in connection with special assignments relating to the enlarge-

ment of the consolidation perimeter, certification of the estimated value and various consultations.

The Board of Directors

DIRECTORS’ REPORT

24

At the end of the 1997 financial year the profit available for allocation totalled

BEF 9,358,335,517, i.e. the profit of the year for distribution of BEF 4,321,377,016 plus

BEF 5,036,958,501 carried forward from last year.

The Board of Directors proposes to increase the gross dividend per share for 1997 to BEF 104,

compared with BEF 102 per share for 1996, representing an increase of 2%.

In total, the proposed profit allocation is as follows (in BEF) :

• dividends on 25,340,000 shares 2,635,360,000

• allocation to undistributable reserve for own shares 462,705,219

• profit carried forward 6,260,270,298

9,358,335,517

Subject to approval by the Annual General Meeting, the dividend will be paid as from

27 May 1998 on presentation of coupon nr. 45 at the Company’s registered office, as well as at

the following banks :

• BANQUE ARTESIA

• BANQUE BRUXELLES LAMBERT

• BANQUE DEGROOF

• BANQUE INTERNATIONALE À LUXEMBOURG

• BANQUE PARIBAS LUXEMBOURG

appropriation of profit

26

group structure

PARJOINTCO

PETROFINA

TRANSCORELF AQUITAINE

COMPAGNIE GÉNÉRALE DES EAUX (1)

0.8%6.4%

2.1%

21.7%

54.4%

83.1%

0.4%47.6%

COBEPA

2.4%

1.8%

40.5%

12.9%

28.3%

22.7%

47.6%

ROYALE BELGE

BERNHEIM COMOFI 0.7% AXA-UAP

IMÉTAL

ACP

ORIOR

50.0%CLT-UFA

HÉLIO CHARLEROI

ÉDITIONS DUPUIS

PARIBAS1.9%

SUEZ LYONNAISE DES EAUX

11.2%

25.0% 25.0%

100%SUZY

IJSBOERKE 100%

50.0% 50.0%

SOCIÉTÉ GÉNÉRALE DE BELGIQUE

NPM / CNP and consolidated financial subsidiaries 50% JOINT CONTROL

54.5% CONTROL

PARGESA and controlling holding companies (GBL-PARFINANCE-

ELECTRAFINA-AUDIOFINA Groups)

Energy andutilities

Holding companies

Banking, insuranceand real estate

Industry

Agri-food

Audio-visual,culture and leisure

(1)

(1)

(1) Sold early 1998

SHAREHOLDINGS OF:

IN:

NPM/C

NP

PARJ

OINTC

O (1)

PARG

ESA

GBL

PARF

INANCE

ELEC

TRAFI

NA

AUDI

OFINA

TRANSIT

IVE

HOLDIN

G (5)

PAGE

27

major shareholdings

(1) PARJOINTCO is 50% held by the AGESCA NEDERLAND Group, a 89.5% subsidiary of NPM/CNP(2) Sold early 1998(3) ROYALE VENDÔME, jointly controlled by UAP (74.9%) and GBL (25.1%), holds 51.9% of ROYALE BELGE(4) AUDIOFINA holds 50% of CLT-UFA HOLDING, which has a 98% shareholding in CLT-UFA(5) Transitive holding including NPM/CNP’s share through the consolidated controlling holding companies of the PARGESA/GBL/PARFINANCE Group

Controlling holding companies

PARGESA – 54.5% – – – – – 24.4% 29GBL – – 48.9% – – – – 11.9% 30ELECTRAFINA – – – 48.4% – – – 5.8% 30PARFINANCE – – 45.8% 40.7% – – – 16.0% 31AUDIOFINA – – – 0.3% – 51.5% – 3.0% 31

Energy and utilities

PETROFINA 6.4% – – – – 22.7% – 7.7% 33COMPAGNIE GÉNÉRALE DES EAUX (2) 0.8% – – – – – – 0.8% 34SUEZ LYONNAISE DES EAUX – – – – – 11.2% – 0.6% 35ELF AQUITAINE 0.4% – – – – – – 0.4% 36TRANSCOR 47.6% – – 47.6% – – – 53.3% 37

Holding companies

SOCIÉTÉ GÉNÉRALE DE BELGIQUE 2.4% – – – – – – 2.4% 39COBEPA 1.8% – – – – – – 1.8% 40

Banking, insurance and real estate

ROYALE BELGE (3) 2.1% – – 12.9% – – – 3.6% 42PARIBAS (2) – – – – 1.9% – – 0.3% 43BERNHEIM-COMOFI 21.7% – – 40.5% – – – 26.5% 44AXA-UAP (2) – – – – 0.7% – – 0.1% 45

Industry

IMÉTAL – – – – 54.4% – – 8.7% 47ACP 28.3% – – – – – – 28.3% 48HÉLIO CHARLEROI 25.0% – – 25.0% – – – 28.0% 49

Agri-food

ORIOR HOLDING – – 83.1% – – – – 20.3% 51IJSBOERKE GROUP 100.0% – – – – – – 100.0% 52SUZY GROUP 100.0% – – – – – – 100.0% 53

Audio-visual, culture and leisure

CLT-UFA (4) – – – – – – 50.0% 1.5% 55ÉDITIONS DUPUIS 50.0% – – 50.0% – – – 56.0% 56

29

Key consolidated figures (CHF million)

Pargesa 1994 1995 1996 1997

Equity capital 2,563 2,498 2,790 3,264

Net profit (Group share) 162 168 272 731

Net profit per share (CHF) 103.6 103.3 165.7 442.0

Gross dividend per share (CHF) 69.0 70.0 71.0 72.0

Estimated value per share (CHF) 1,925 1,934 2,497 2,814

PARGESA GROUP

PARGESA

PARGESA, a company incorporated under Swiss law, isthe umbrella institution of the PARGESA Group, whichinvests in Europe through two controlling holdingcompanies: GBL in Belgium, PARFINANCE in Franceand a company which specialises in agri-food, ORIORin Switzerland.

GROUPE BRUXELLESLAMBERT

GBL has holdings in a series of top-rankingcompanies, including ELECTRAFINA, ROYALEBELGE and BERNHEIM-COMOFI. GBL also hasholdings in unquoted companies such asBELGIAN SKY SHOPS (tax-free shops atBrussels-National airport) and GILLAM(telecommunications).

ELECTRAFINA

ELECTRAFINA controls AUDIOFINA and is theleading shareholder in PETROFINA and SUEZLYONNAISE DES EAUX.ELECTRAFINA also pursues the developmentof its own oil activities through the AMERICANCOMETRA Group and the British oildevelopment company MONUMENT OIL &GAS.

PARFINANCE

On 31 December 1997, the main componentsof PARFINANCE’s portfolio were a 54.4%holding in IMÉTAL and interests in PARIBAS(3.2%) and AXA-UAP (1.9%). The two latterholdings were disposed of in their entirety inearly 1998. PARFINANCE announced its planto merge with IMÉTAL with effect from 1 July1998.

AUDIOFINA

AUDIOFINA controls CLT-UFA, the largesttelevision and radio Group in Europe, inpartnership with the German GroupBERTELSMANN. AUDIOFINA also has a 3.3%holding in the HAVAS Group (sold in early1998) and funds of LUF 30 billion.

At the level of its holdings, PARGESA dedicated CHF 130 million in 1997 to strengthening GBL’s equity capital by exer-

cising the warrants that it held. In addition, its holding in ORIOR was increased from 74.1% at the end of 1996 to 83.1% by the

purchase of blocks and by interventions in the stock market.

The net consolidated profit for the past business year (1997) amounts to CHF 730.7 million, compared to CHF 271.5 mil-

lion the previous year. This development is due mainly to the capital profit realised by GBL with the ING public offer of

exchange of ING on the BBL (BANQUE BRUXELLES LAMBERT), by ELECTRAFINA with the merger of CLT and UFA and with

the sale of American oil assets. At the General Meeting, the Board of Directors will propose payment of a dividend of CHF 72

per bearer share, compared to a CHF 71 dividend in 1996.

49.4% holding48.9% consolidated

47.6% holding45.8% consolidated

48.4%

0.3%

51.5%

40.7%

Contribution to :

Restricted Consolidationconsolidation (transitive)


Operating result 1997 705 27.8 – –

Estimated value at 31.12.1997 27,957 1,079.6 – –

30

In 1997, the exercise of 791,181 GBL warrants allowed an

increase in equity capital of BEF 3.5 billion. In December 1997,

GBL converted 330.000 ELECTRAFINA bonds redeemable in

shares, a transaction which gave it a 48.4% holding in the latter’s

capital. In early 1998, GBL increased its holding in this company

to over 50%.

In spring 1997, GBL sold its 1.8% holding

in GIB GROUP, realising a capital gain of

BEF 0.8 billion. In November 1997, together

with the ROYALE BELGE Group, GBL decided to

respond favourably to the public offer of

exchange launched by ING on the BANQUE

BRUXELLES LAMBERT. Through this opera-

tion, GBL realised a capital gain of BEF 13.9 bil-

lion. On 31 December 1997, its holding in ING

accounted for some 13.4% of the estimated value

of GBL; this has been classified as liquid assets.

For 1997, the consolidated profit comes to BEF 31.7 billion,

compared with BEF 16.9 billion the previous year.

On 31 December 1997, the market price for GBL shares was

BEF 5,360, meaning that it was discounted by 27.2% compared to

the estimated value of BEF 7,366 (BEF 7,195 diluted). On

30 March 1998, the market price settled at

BEF 6,480, meaning that it discounted by

24.3% compared to the estimated value of

BEF 8,563 (BEF 8,324 diluted).

In early 1998, GBL disposed of its holding

in DEWAAY and BANQUE PARIBAS

BELGIQUE (renamed BANQUE ARTESIA),

making a profit of BEF 1,7 billion. During the

first quarter of 1998, GBL sold almost half its

stake in ING, realising a gain of BEF 3,5

billion.

Key consolidated figures (BEF million)

Electrafina 1994 1995 1996 1997

Equity capital 77,745 77,159 121,024 127,769

Net profit (Group share) 5,342 5,294 24,269 10,538

Net profit per share (BEF) 190 178 724 283

Gross dividend per share (BEF) 137.4 140.0 142.0 145.0

Estimated value per share (BEF) 3,698 3,845 4,041 4,979


GBL 1994 1995 1996 1997

Equity capital 74,184 75,597 88,676 117,319


Net profit per share (BEF) 282 281 718 1,327



Groupe Bruxelles Lambert

In February 1997, AMERICAN COMETRA sold US$ 400 mil-

lion of oil assets to LOMAK PETROLEUM. In the autumn, it

signed a memorandum of agreement with PIONEER NATURAL

RESOURCES CY., a company quoted on the New York stock mar-

ket, in accordance with which AMERICAN COMETRA transferred

the balance of its oil assets in the USA to PIONEER NATURAL

RESOURCES CY. for US$ 85 million and

1.6 million PIONEER shares. These transac-

tions had a positive effect on the consolidated

accounts of BEF 6.6 billion.

In 1997, the COMPAGNIE DE SUEZ and

the LYONNAISE DES EAUX announced their

merger into SUEZ LYONNAISE DES EAUX.

ELECTRAFINA, which had a 6.1% holding in

the COMPAGNIE DE SUEZ on 1 January 1997,

strengthened its holding in the newly merged

company by investing FRF 5,252 million in

1997, so becoming the leading shareholder

with 11.2% of the capital on 31 December 1997.

In June 1997, ELECTRAFINA sold its 1.3% holding in

CANAL+ to AUDIOFINA.

The year 1997 closed with a consolidated profit (Group share)

of BEF 10.5 billion, compared to BEF 24.3 billion in 1996.

On 31 December 1997, ELECTRAFINA’s three major hold-

ings, i.e. PETROFINA, SUEZ LYONNAISE DES EAUX and AUDIO-

FINA, accounted for 36.7%, 29.4% and 24.5%

respectively of the estimated value. The mar-

ket price of the ELECTRAFINA share, which

was BEF 3,410 on 31 December 1997, showed

a 31.5% discount compared to the estimated

value of BEF 4,979. On 24 March 1998, the

market price of BEF 4,250 represented a dis-

count of 23.6% compared to the estimated value

of BEF 5,560.

Electrafina

PARGESA GROUP

PARIBAS shares, bringing their value at the end of the year to their

original cost, FRF 417 per share.

In March 1998, PARFINANCE disposed of its remaining shares

in AXA and PARIBAS on the stock market, realising a gross capi-

tal gain of FRF 972 million. Taking these disposals into account, a

bonus dividend of FRF 100 per share, corresponding to a total pay-

out of FRF 2,300 million, will be added to the ordinary PARFI-

NANCE dividend of FRF 7.5 per share to be paid in June 1998.

Extraordinary Shareholders’ Meetings at IMÉTAL and PARFI-

NANCE, planned for 30 June 1998,

will rule on the planned absorption of

PARFINANCE by IMÉTAL on the basis

of parity of two IMÉTAL ex-dividend

shares for five PARFINANCE shares

after distribution of ordinary and

bonus dividends.

31

In 1997, PARFINANCE increased its holding in IMÉTAL from

52.5% to 54.4% and sold 17% of its positions in AXA and PARIBAS

in order to respond to the expected demand for redemption from

holders of bonds redeemable in shares from its subsidiary SOPAR-

INVEST.

The net consolidated profit for the year rose to FRF 583 mil-

lion, compared to FRF 126 million in 1996:

• the contribution of IMÉTAL, the only holding accounted for

under the equity method, comes to FRF 299 million after depre-

ciation of acquisition differences

amounting to FRF 32 million;

• operating income for the whole

company fell to FRF 44 million, com-

pared to FRF 124 million in 1996;

• capital income amounted to FRF 241

million, compared to FRF (297) mil-

lion in 1996. This consists mainly of

a write-back (FRF 230 million) on

Key consolidated figures (LUF million)

Audiofina 1994 1995 1996 1997

Equity capital (before distribution) 13,136 22,800 25,715 45,541


Net profit per share (FRF) 123.1 53.0 54.2 328.8

Gross dividend per share (FRF) 20.4 21.0 22.0 22.0

Key consolidated figures (FRF million)

Parfinance 1994 1995 1996 1997

Equity capital (before distribution) 8,094 8,262 5,909 6,537




Estimated value per share (FRF) 264 273 378 405

Parfinance

The year 1997 was marked by two main events:

• The merger of CLT and UFA in January 1997. To begin with,

the German Group BERTELSMANN transferred UFA, its audio-

visual specialist subsidiary, to CLT, in which AUDIOFINA then had

a 97% controlling share. AUDIOFINA then sold CLT shares to

BERTELSMANN so that the two partners would have identical hol-

dings in the new CLT-UFA Group. The sale of CLT shares to

BERTELSMANN led to a payment of DM 1,556 million (LUF 32.1

billion) to AUDIOFINA, corresponding to an extraordinary profit of

LUF 21.5 billion. In the afterma-

th of these transactions and the

purchase of minority interests in

FRATEL, AUDIOFINA now has a

50% share in CLT-UFA HOLDING,

equal to the holding of BWTV, in

which BERTELSMANN has an

80% holding, the other 20% being

in the hands of the German press

publisher WAZ.

• The restructuring of AUDIOFINA’s shareholding during the

autumn of 1997, which resulted in a modification of the relation-

ship between the GBL/ELECTRAFINA Group and HAVAS. The lat-

ter exchanged its indirect holding in AUDIOFINA (through a 40%

holding in CLMM, the remaining 60% being held by ELECTRA-

FINA) for a direct holding of 19.6 %. CLMM’s intermediary control

structure was then dismantled.

On 31 December 1997, AUDIOFINA’s assets comprised the

following holdings: 50% in CLT-UFA HOLDING, 3.3% in HAVAS,

1.4% in CANAL+. On the same

date, AUDIOFINA’s funds (exclu-

ding CLT-UFA debts) came to

LUF 29.1 billion.

The holding in HAVAS was

disposed of in early 1998, reali-

sing a capital gain of LUF 1.5

billion.

Audiofina

PARGESA GROUP

Petrofina

PETROFINA is an integrated oil and chemicals group with business activities spanning all sectors of the oil industry :exploration, production, transport, refining, petrochemicals, marketing oil and chemical products, and research.

The Group also has interests in paints and oleo-chemicals.

The consolidated profit (including minority holdings) for

PETROFINA totalled BEF 22.7 billion in 1997, using the

American accounting standards adopted in 1997, compared with

BEF 16.6 billion in 1996, a rise of 37%. The Group share in this

profit was BEF 22.1 billion (BEF 946 per share) compared with

BEF 15.9 billion in 1996 (BEF 686 per share), equivalent to a

rise of 39%. Consolidated cash flow for 1997 reached BEF 57

billion compared with BEF 44 billion in 1996. The Group’s share

of this cash flow represented BEF 55 billion (BEF 2,368 per

share) compared with BEF 42.4 billion in 1996 (BEF 1,824 per

share).

Profit growth was due to the following developments:

• the excellent performance of the downstream sector, based on

the quality of refining operations, the production increase and

improved margins;

• results for the upstream sector were slightly up, the increase

in production of more than 9% and the rise of 16% in the USD

exchange rate compared with 1996

being slightly offset by the fall in the

price of Brent crude by around

USD 1.56 a barrel and a boost to

exploration efforts;

• the results from the chemical

sector were a little lower, with the

rise in earnings in Europe and

overall growth in sales unable to

compensate for the effects of the fall

in American margins.

The Group plans to invest BEF 45 billion in 1998, compared

with BEF 44 billion in 1997. These investments will be largely

devoted, in the upstream sector, to the exploration effort, deve-

lopments planned or in progress in the United States and the

British sector of the North Sea, and finalisation of the EKOFISK

redevelopment plan. In the downstream sector, investments will

be made in chemicals and in the modernisation and expansion

of the network of FINA petrol stations in Europe. These invest-

ments will finance the construction of a steam cracker at the

Port Arthur refinery in the United States, the extension of

polypropylene and polyethylene production capacity in progress

in the Group’s American factories and the debottlenecking of

European factories.

During the past year, PETROFINA shares were listed on the

New York Stock Exchange, in the form of certificates each equi-

valent to one tenth of a share in PETROFINA.

As part of the merger by absorption of the American

subsidiary FINA Inc., PETROFINA

will offer minority shareholders

USD 60 per share together with a

warrant allowing them to acquire

nine tenths of a PETROFINA certifi-

cate (0.09 share) at a price of

USD 42.25 per certificate.

The Company will propose to

the Annual General Meeting an

increase in the gross dividend of 15%

bringing it to BEF 460 per share.

Key consolidated figures (BEF million)(US GAAP)

1994(1) 1995 1996 1997

Equity 122,969 123,098 135,011 155,915

Turnover 580,676 558,724 622,145 727,031



Gross dividend per share (BEF) 320 352 400 460

Contribution to :



Operating result 1997 600 23.7 1,696 66.9

Estimated value at 31.12.1997 20,527 792.7 24,564 948.6

33

(1) the 1994 data are expressed in Belgian GAAP

34

Compagnie Générale des Eaux

COMPAGNIE GÉNÉRALE DES EAUX manages and directs the leading French private services group in the environmental(water, power, cleaning and transport), construction and communications sectors. It has become the world-wide leader in

diversified municipal and community services.

The Group turnover totalled FRF 167.1 billion, a rise of 5.6%

using a constant consolidation perimeter. This covers growth of

10% in the two main priority strands of Group expansion: envi-

ronmental services (+ 5.3%) in France and abroad, and commu-

nication in France (rise of 78% in turnover at SFR to FRF 9.2 bil-

lion). Conversely, in the construction and property sector, Group

turnover fell by 1%, with a 4% drop in construction and public

works, although property is making a significant recovery.

Abroad, the Group achieved turnover of FRF 53.8 billion, a

rise of 5.3%, mainly in environmental services where growth was

15.4% using a constant perimeter and unchanged exchange rates.

Group operating income totalled FRF 4.2 billion, up by 42%

using a constant perimeter and unchanged exchange rates. In

water services, where growth was in the order of 5% excluding

OTV and AWT, the first effects of reorganisation in France of-

fset the fall in consumption. In the energy sector, growth topped

7%, and achieved 21% in cleaning services. The transport busi-

ness has begun to show the positive effects of its international

expansion with growth of 46%. Construction and public works

enterprises in the Group and the CGIS substantially reduced their

losses, as predicted. In the field of telecommunications, major

investments continued to weigh heavily with an operating loss

of FRF 1.2 billion (compared with FRF (1.1) billion in 1996). The

operating loss from mobile telephone activities was reduced from

FRF 1.1 billion to FRF 0.4 billion.

Financial earnings showed a loss of FRF 2 billion. The

exceptional earnings of FRF 3.3 billion include dilution profits

of FRF 7.2 billion, capital gains on sales of FRF 6.6 billion, depre-

ciation on goodwill of FRF 2.5 billion and exceptional losses of

FRF 8 billion.

After income accounted for by the equity method of FRF 0.7

billion, taxes of FRF 1.3 billion, minority interests of FRF (0.8)

millions and a participation of FRF 0.3 billion, the Group share

of net consolidated earnings was FRF 5.4 billion, representing a

rise of 61%.

Cash flow totalled FRF 23.4 billion, allowing a reduction of

FRF 17.6 billion in net debt which now stands at FRF 27.5 billion.

In March 1998, the Boards of Directors of the COMPAGNIE

GÉNÉRALE DES EAUX and HAVAS approved in principle the

arrangements for a merger of the two companies which will be

subject to the approval of shareholders at the Extraordinary

General Meeting on 11 May 1998.


1994 1995 1996 1997

Equity 34,446 30,176 33,682 44,911

Turnover 156,157 162,961 165,914 167,116

Net profit (Group share) 3,346 (3,686) 1,953 5,393

Earnings per share (FRF) 30.2 (31.3) 16.2 41.8

Dividend per share (FRF) 11.25 11.25 12.00 15.00

Contribution to :



Operating result 1997 93 3.7 93 3.7


Suez lyonnaise des eaux

SUEZ LYONNAISE DES EAUX is born from the merger between the COMPAGNIE DE SUEZ and LYONNAISE DES EAUX. A Franco-Belgian industrial group operating in more than one hundred countries,

SUEZ LYONNAISE DES EAUX focuses on four main strands of activity : energy, water, cleaning and communication, and its ambition is to become the world leader for the provision of local authority services.

In 1997 renewed international expansion took the form of:

• signature of a contract for operating gas transport networks by

TRACTEBEL in Kazakhstan;

• winning many new water supply and cleansing contracts

(Philippines, Bolivia, Morocco, Indonesia, Turkey, Slovenia,

Hungary, Vietnam, Palestine, etc.) which increased the number

of clients by 20 million, bringing the total number of people

served by the Group up to 70 million;

• accelerated international development of SITA. After having

taken over the French and Spanish activities of WASTE MANA-

GEMENT INTERNATIONAL and buying out VEGA, the leading

company in the Brazilian cleaning market, at the beginning of

1998 SITA acquired all of the activities, outside North America,

of BROWNING-FERRIS INDUSTRIES, thereby becoming the lead-

ing European operator and the world number three in waste

management services.

Through this internal and external growth, in 1997 SUEZ

LYONNAISE DES EAUX made significant progress towards

achieving its objective of refocusing on its core business of

providing local authority services.

This refocusing process was also boosted by the sale of cer-

tain holdings: during the first half of the year, the Group sold all

of its portfolio of property investments to real estate companies,

together with property development activities on its own account,

for FRF 3 billion. It also sold its 50% interest in FACTOFRANCE

HELLER (factoring) and 100% of the company SEV (life insur-

ance). SUEZ LYONNAISE DES EAUX carried out other important

sales such as the UNION MINIÈRE (24%) for FRF 3.2 billion,

ACCOR for FRF 2.2 billion, ORION for FRF 550 million and 30%

of SEPHORA. In 1997 these sales raised a total sum in excess of

FRF 10 billion.

SUEZ LYONNAISE DES EAUX began the process of simpli-

fying its structures through mergers and take-overs of certain

subsidiaries, including the mergers between TRACTEBEL and

POWERFIN, and between SUEZ INDUSTRIE, COMPAGNIE D’IN-

VESTISSEMENT ASTORG, SUEZ VENTURES and SUEZ

FINANCE CONSEIL, as well as between the Banque LA HENIN

and the Banque MONOD.

In January 1997, SUEZ LYONNAISE DES EAUX made a take-over

bid for ELYO (energy) and in October for DEGRÉMONT (water

treatment engineering).

35


1995(1) 1996(1) 1996(2) 1997

Equity (before distribution) 16,461 18,431 45,413 49,300

Turnover 98,615 91,620 173,214 190,420

Net profit (Group share) 906 1,349 1,981 4,013


Dividend before tax per share (FRF) 11.5 12.0 12.0 15.0

Contribution to :



Operating result 1997 – – 52 2.0

Estimated value at 31.12.1997 – – 3,212 124.0

(1) LYONNAISE DES EAUX(2) pro forma after merger

36

Elf aquitaine

The ELF Group, which has operations in 80 countries, is one of the top ten petroleum groups in the world and the fourthlargest natural gas producer in Europe. Its ELF ATOCHEM subsidiary is the thirteenth largest chemicals group in the

world. SANOFI is among the top 30 health laboratories in the world. Since its privatisation in 1994, the ELF group hasrefocused on its core businesses (Hydrocarbons, Chemicals and Health), implemented a cost reduction policy aimed at

improving its profitability, and continued to expand in emerging markets.

In 1997, operating income grew by 14% to FRF 25.4 billion.

The contribution made by the various sectors of activity was as

follows:

• Exploration - Production: operating income for the year rose

by 8% to FRF 17.1 billion. Excluding special items, the slight rise

in operating income came from a FRF 1 billion reduction in

costs, allowing a fall of 10% in production costs, from USD 2.9

per barrel in 1996 to USD 2.6 per barrel in 1997. This offset the

unfavourable operating environment (with an average fall of 8%

in Brent crude prices in USD terms which was only partly of-

fset by the rise in the USD/FRF exchange rate) and the fall of

2.6% in the quantity sold. Exploration costs in 1997 remained

stable at FRF 2.3 billion;

• Refining - Distribution: more than half of the rise of FRF 0.4

to FRF 2.2 billion in the contribution to operating income is due

to the better operating conditions, and the rest to productivity

gains. In dollar terms, European refining margins remained sta-

ble at USD 2.70 per barrel in 1997 compared with USD 2.67 per

barrel in 1996. On the other hand, the appreciation of the dol-

lar against the currencies of the future euro zone resulted in

improved refining margins expressed in these currencies.

However, the operating income from this activity showed a loss

of FRF 3.2 billion in the wake of an exceptional depreciation of

FRF 5.4 billion on the value of the Leuna refinery;

• Chemicals: operating income was up by 12% to FRF 4.1 bil-

lion. This improvement stemmed largely from the competitive-

ness of operations because in 1997 operating conditions for

chemicals varied considerably : continued growth in North

America, the beginnings of a recovery in Europe, a slowdown in

Asia and appreciation of the USD against the FRF;

• Health: the fall in the contribution to operating income to

FRF 2.1 billion is due to boosting its sales resources in prepara-

tion for the launch of new medicinal products, as well as an

increase in Research and Development costs.

Cash flow from operations rose by 7% to FRF 33.2 billion

and largely covered the FRF 25.8 billion of investments, inclu-

ding exploration investments of FRF 3.5 billion. The net finan-

cial debt fell to FRF 35.4 billion by the end of 1997 (FRF 37.2

billion in 1996). At the end of 1997, the debt ratio stood at 32%

compared with 37% at the end of 1996.

Net operating income rose by 35% to FRF 10.2 billion. After

taking into account the net capital gains of FRF 0.8 billion realised

on the sale of financial assets and an exceptional depreciation of

FRF 5.4 billion on the value of the refinery at Leuna, net ear-

nings were FRF 5.6 billion (FRF 7 billion in 1996).


1994 1995 1996 1997

Equity 76,472 78,672 80,062 83,985

Turnover 207,674 208,290 232,707 254,306

Net profit (Group share) (5,439) 5,035 6,977 5,602

Net profit per share (FRF) (21.0) 18.9 26.0 21.8


Contribution to :





Transcor

The TRANSCOR Group’s operations cover the distribution and trading of energy products : coal, oil, and more recentlygas and electricity, through three companies (ASTRA, TRANSCOR AG and TRANSCOR ENERGY).

The ASTRA Group, traditionally active in petroleum

trading, obtained good results in 1997 thanks to its policy of

concentrating on certain particularly promising niche markets.

An important milestone in the development of the Group was

reached at the beginning of 1998, with the launch of gas and

electricity trading in the north-American market. This decision

should allow the Group as a whole to acquire the necessary

experience to position itself over time as a global supplier of all

the various energy needs of its clients.

TRANSCOR AG, which trades coal in the European and

North American markets, made a positive contribution to group

earnings with an improvement on last year, despite massive

stockpiles of coke for European steelmakers. The north-American

subsidiary set up at the beginning of the year achieved its

trading targets.

TRANSCOR ENERGY (formerly HAUTERAT & WATTEYNE),

a Belgian energy products distributor, retained its market share

for sales of fuel oil to its Belgian customer base, and also entered

the new business of trading in coke and coal in the German

market through its German subsidiary TRANSCOR

ENERGIEHANDEL GmbH, as well as heating oil in Belgium and

Germany and the border regions. These new activities should

make a positive contribution as from 1998.

Globally, 1997 produced very satisfactory overall results

and saw changes in the sales organisation of the Group in

response to prospects for expanding these activities.


1994 1995 1996 1997

Equity 1,271 1,203 1,286 1,434

Turnover 59,045 33,324 42,051 49,055


Dividends 240 50 145 200

37

Contribution to :




Estimated value at 31.12.1997 778 30.0 868 33.5

39

Société générale de Belgique

The SOCIÉTÉ GÉNÉRALE DE BELGIQUE, the leading Belgian group of enterprises, has shareholdings in seven companiesoperating in the international arena : TRACTEBEL (electricity, gas, engineering, environment), GÉNÉRALE DE BANQUE(banking and financial services), FORTIS AG (insurance and financial services), UNION MINIÈRE (non-ferrous metals),RECTICEL (polyurethane foams), COFICEM/SAGEM (electronic and telecommunications equipment) and ARBED (steel).

For the sixth consecutive year, SGB improved its consoli-

dated operating income (+41%), with all the companies in the

Group making a positive contribution. It entirely reabsorbed the

debt resulting from raising its stake in TRACTEBEL in 1996

using the proceeds from the sale of three assets:

• the 9% holding in ACCOR was sold for BEF 13.6 billion, real-

ising a capital gain of BEF 2.7 billion;

• the 50% holding in UNION MINIÈRE was reduced to 25%, a

transaction with a value of BEF 19.5 billion which realised a

capital gain of BEF 12 billion;

• the conversion of all convertible bonds into ARBED shares

issued by the SGB, together with the sale of ARBED shares on

the stock market, reducing the holding to 9.45%.

In 1997, all of the companies in the group successfully pur-

sued their expansion strategy:

• in 1997 and early 1998, TRACTEBEL won several major elec-

tricity contracts (Vietnam, Peru, Thailand, India, the United

States and Canada) to install total capacity of more than 1,800

MW. Important gas contracts were concluded in Jordan, Chile

and Kazakhstan. In the United States, TRACTEBEL has entered

the field of energy product trading. TRACTEBEL and

POWERFIN were merged in order to simplify the organisation,

increase the liquidity of the

share and enhance the group’s

visibility;

• GÉNÉRALE DE BANQUE

extended its international reach

by acquiring shareholdings,

making acquisitions (HAMBROS

BANK LTD in Great Britain) and opening regional and represen-

tative offices. It expanded its fund management business, pri-

marily by taking a majority interest in HARBOR CAPITAL MAN-

AGEMENT in the USA;

• FORTIS AG increased its capital by BEF 16.3 billion, to which

SGB subscribed its share (BEF 3.1 billion). The Group made

several acquisitions in the banking and insurance sector in the

United States (AMERICAN SECURITY GROUP, PIERCE

NATIONAL LIFE INSURANCE and JOHN ALDEN FINANCIAL

CORP. at the beginning of 1998) and in Great Britain (ASPEN

INSURANCE SERVICES). In Belgium, FORTIS raised its stake in

the CGER to 74.9% by purchasing the 24.7% held by the Belgian

state;

• in parallel with the implementation of its industrial plan,

UNION MINIÈRE continued its international expansion by

acquiring a 98.5% interest in the Bulgarian company MDK which

operates a copper smelting and refining plant, as well as the raw

materials for batteries and cobalt powders manufacturing activi-

ties of THE WESTAIM CORPORATION OF CANADA;

• RECTICEL signed cooperation agreements with GREINER

(extension of their EUROFOAM joint-venture), PIKOLIN (the

leading Spanish bedding manufacturer) and CORRECTA (a

German insulation manufactur-

er). In February 1998, a prelim-

inary agreement was signed for

the acquisition of the Belgian

company VERHAEGEN (LAT-

TOFLEX mattresses and bed-

springs).


1994 1995 1996 1997

Equity 165,769 166,470 166,335 178,079





Contribution to :





This forty-first year in business was marked by the division

of GEVAERT and the absorption by COBEPA of half of its assets.

This major operation also provided an opportunity to reposition

IBEL in the market and concentrate its investment strategy.

Amongst the most important divestments carried out was

the sale of 8.6% of the BANQUE PARIBAS BELGIQUE to BACOB,

with the remainder to be sold off gradually in 1998, 1999 and

2000. Various financial positions were liquidated, in particular

the remaining stake in MONCEAU-ZOLDER held by MOSANE,

the shareholding in DÉFINANCE, 0.6% of NPM/CNP, 100,000

DEXIA-FRANCE shares, and a series of Canadian shareholdings.

Furthermore, various holdings were disposed of, prominent

among which was the interest in FOUNTAIN. IBEL was

involved in the stock market flotation of IPSO-I.L.G. TEXAF

sold its 10% interest in EXTRACTION DE SMET. For its part,

COBEPA contributed the balance of its stake in SAGAL, repre-

senting 3.2% of the capital, to the public offer of withdrawal

organised by PARIBAS.

On the investment front, IBEL took a 21.3% stake in

ANCORABEL, the holding company controlling NEW DISTRI-

BUTION SYSTEMS, and in the family busi-

ness of SPAAS. MOSANE, for its part,

acquired a 26% holding in ALL-TAG SECU-

RITY. In the Netherlands, the Dutch sub-

sidiary PARIBAS DEELNEMINGEN has had

an interest since the beginning of the year in

the capital of ARIANNE BEHEER, TRIPLE P

and HOLLAND CHEMICAL INTERNATIONAL

(apart from VEGRO BEHEER and the APPLE-

BEE restaurants). At the end of the year,

COBEPA itself contributed to an increase in

capital at FICHET-BAUCHE (safes, locks, elec-

tronic security equipment) alongside another

company in the PARIBAS Group, the COMPAGNIE DE NAVIGA-

TION MIXTE. The group also provided additional resources for

enterprises in which it already had an interest, either through

subscribing to an increase in capital (MOBISTAR), reinvestment

of dividends (SWETS & ZEITLINGER, AEGON), buying (GIB) or

conversion of debts (SODISCO-HOWDEN).

Its consulting business mainly dealt with acquisitions or

sales, with the group providing assistance notably to SWISS

LIFE for the acquisition of GAN BELGIUM and, in the

Netherlands, to UNI-INVEST in its take-over bid for CAPA CITY

REALTY. It advised GIB on the sale of PEARLE VISION and the

shareholders selling the distributor HEYTENS.

Net earnings (group share) totalled BEF 23,410 million.

However, the capital gains of BEF 15,225 million realised dur-

ing the division-absorption of GEVAERT had a neutral effect on

the equity capital after cancellation of own shares. Ignoring this

operation, the remaining net income (group share) totalled

BEF 8,185 million.

Group operating cash flow (the consolidated operating

income of the integrated companies) totalled BEF 2,294 million

(compared with BEF 1,970 million in 1996),

a rise of 10.4% per share taking into account

the higher number of shares in circulation.

The asset value per share rose from

BEF 1,662 on 31 December 1996 to

BEF 2,176 on 31 December 1997 (and to

BEF 2,416 on 28 February 1998), giving a

financial return of 36.1% for the whole of

1997. On the basis of intrinsic value, the

corresponding figures are BEF 1,451 on 31

December 1996, BEF 2,040 on 31 December

1997 (and BEF 2,280 on 28 February 1998)

giving an annual return of 44.9%.

40

Cobepa

Traditionally operating in Benelux and Canada, COBEPA exercises its dual role as a merchant bank and an active investor within the PARIBAS global network.


1994 1995 1996 1997

Equity 47,744 47,056 50,064 55,994


Net profit per share (BEF) 107.1 78.9 75.0 181.4



Contribution to :





42

Royale Belge

ROYALE BELGE is an insurance and financial services group operating in the Benelux and northern European markets,in which it pursues a combined growth and yield policy. It provides a complete range of life and non-life insurance,

savings and investment and loan products to individuals.

The consolidated premium income of the ROYALE BELGE

Group totalled BEF 112.2 billion, virtually the same as in 1996.

These earnings were realised for 62.5% in Belgium, 33.4% in the

Netherlands and 4.1% in Luxembourg.

In Belgium, despite the lack of growth in non-life insurance,

overall premium income was up by 2.1% due to the 6.3% growth

in life insurance. ROYALE BELGE continues to give priority to the

development of its relations with independent brokers. A new

sales structure common to the ROYALE BELGE and the BANQUE

IPPA was set up, focusing on a co-ordinated policy using inter-

mediaries. Moreover, the ROYALE BELGE is continuing to pursue

its multi-distribution policy. Via the UAB, it sells life and non-life

insurance policies to individuals via two networks of exclusive

agents. The development of distribution agreements with Belgian

banks continues whilst adapting to the new market conditions.

Through its two subsidiaries held in equal partnership with LA

POSTE, it should be possible to market life and non-life insurance

products to individuals as from 1998 over

post office counters.

In the Netherlands, the fall in turnover

results from the loss of life insurance pre-

miums from a major approved broker,

restoring the health of the non-life insurance

portfolio and a drop in health care premium

earnings due to fierce competition from cer-

tain major operators. The UAP-NIEUWROT-

TERDAM Group was reorganised around a

brokerage strand and an insurance strand, active in life, non-life

and non-statutory provident funds.

In Luxembourg, turnover grew by 5.8% thanks to growth in

premium income in the entire range of life and non-life policies.

The launch of multi-guarantee insurance cover for businesses and

the new prospects in the pension insurance market within com-

panies represent future sources of expansion.

Belgian insurance operations made a strong contribution to

the consolidated profit with good technical results, improved finan-

cial earnings and operating income from the BANQUE IPPA which

rose again this year. The earnings from insurance activities in

Luxembourg and the Netherlands improved despite the significant

deterioration in profits from health care.

The Group share of the consolidated profit totalled BEF 23.2

billion, including an exceptional item of BEF 14.2 billion, from the

capital gain made on the exchange of BBL shares. Apart from

exceptional capital gains, net operating profits totalled BEF 9 bil-

lion, compared with BEF 7.1 billion in 1996,

equivalent to a growth of 26.7%. The return

on equity, which stood at BEF 75 billion at

the end of 1997, is therefore 14.9%. On the

same date, consolidated latent capital gains

on listed securities and buildings totalled

BEF 81.2 billion, up from BEF 64 billion at

the end of 1996 and BEF 51.1 billion at the

end of 1995.

Key consolidated figures (BEF million)Contribution to :





1994 1995 1996 1997

Equity 51,696 56,436 61,899 74,954

Premium income 75,123 109,353 112,436 112,155


Net profit per share (BEF) 344 386 708 1,447


43

The activities of the PARIBAS Group are divided into three strands :• Commercial Banking, which includes the shareholding acquisition business of PARIBAS AFFAIRES INDUSTRIELLES ;

• the Asset Management and Savings division ;• the Specialised Financial Services division.

Refocusing and simplification of the structures at PARIBAS

continued into 1997:

• completion of the divestment of branch banking with the sale

of CRÉDIT DU NORD, PARIBAS BELGIQUE, PARIBAS NEDER-

LAND and PARIBAS PACIFIQUE;

• public take-over bid by the COMPAGNIE BANCAIRE for its

subsidiaries CARDIF and UFB LOCABAIL;

• public offer of exchange by the COMPAGNIE FINANCIÈRE DE

PARIBAS on the COMPAGNIE BANCAIRE and CETELEM.

Furthermore, the planned merger between BANQUE

PARIBAS, COMPAGNIE FINANCIÈRE DE PARIBAS, COMPAGNIE

BANCAIRE and COMPAGNIE DE NAVIGATION MIXTE was

announced in February 1998. BANQUE PARIBAS will participate

in this project as the absorbing company. It will adopt the name

of PARIBAS and will replace COMPAGNIE FINANCIÈRE DE

PARIBAS on the stock exchange.

In 1997 PARIBAS made net earnings (Group share) of

FRF 6,573 million compared with FRF 4,350 million in 1996.

This does not take into account the 50% of earnings of

COMPAGNIE BANCAIRE’s,

which has a 67% share in those

of CETELEM, as the public

offers of exchange did not take

place until the end of the year.

Total earnings at PARIBAS

before goodwill and taxes,

including minority interests,

stood at FRF 10,581 million

compared with FRF 5,893 mil-

lion in 1996. This takes into

account the earnings of FRF 1,365 million from businesses

which were sold, the general provision of FRF 1,900 million for

Asia and the tax credit of FRF 1,297 million resulting from the

fiscal integration of the earnings from CETELEM and CARDIF as

from 1997.

The breakdown by sector under the new PARIBAS structure

is as follows:

• the Commercial Banking division progressed from FRF 5,746

million in 1996 to FRF 6,301 million in 1997, with a rise of 26%

in earnings at PARIBAS AFFAIRES INDUSTRIELLES compen-

sating for the fall of 5% in earnings from other Commercial

Banking activities;

• the Asset Management and Savings division saw strong

growth, up from FRF 530 million in 1996 to FRF 988 million in

1997 due to a rise in deposits and assets under management;

• the Specialised Financial Services division followed the loss

of FRF (901) million in 1996, stemming from exceptional provi-

sions on real estate assets, with a profit of FRF 2,277 million

in 1997;

• the remainder, primarily

associated with real estate

assets, the financial portfolio

and the COMPAGNIE DE NAVI-

GATION MIXTE, rose from

FRF 518 million in 1996 to

FRF 1,016 million in 1997.

A proposal has been made

to raise the net dividend for 1997

to FRF 14 per share compa-

red with the previous FRF 13.


1994 1995 1996 1997


Net profit (Group share) 1,715 (3,998) 4,350 6,573

Net profit per share (FRF) 15.6 (33.9) 39.7 59.4


Paribas

Contribution to :





44

Bernheim-Comofi

BERNHEIM-COMOFI is a real estate group active in five businesses: real estate development (Belgium, Budapest,Berlin and Prague), ownership and operation of public parking lots, ownership and operation of self-storage businesses,

real estate securitization and provision of building sites.

Backed by its real estate experience acquired over many

years in property and site development, the BERNHEIM-COMOFI

Group has expanded into a range of value-added property

related activities.

Property development, which remains the foundation on

which the other business activities are based, was marked du-

ring the year by the withdrawal from a project in Berlin, the sale

of the company which owns the building developed in Budapest,

and of a building in an advanced state of completion in Brussels,

located in the Avenue des Communautés. A new site came on

stream in Budapest, and construction and marketing negotiations

are in progress for other sites in Brussels. The Group participa-

ted in the creation of WETINVEST – with a holding of 33% –

which is starting the construction of a 15,000 m2 building on the

outskirts of Brussels.

The value of securitized property under management at

BEF 28 billion is up by 35%. This growth is largely due to the

merger of SICAFI BEFIMMO with the companies of the PRIFAST

Group, raising the value of BEFIMMO’s property portfolio from

BEF 6.7 to 10.8 billion. On 31 December 1997, BERNHEIM-

COMOFI held 13.4% of BEFIMMO.

The INTERPARKING Group, a 50% owned company, con-

tinued to expand and currently operates 213 car parks with more

than 102,000 parking places distributed across six countries in

continental Europe. The successful integration of CODEPARC and

falling interest rates led to consolidated cash flow after tax of

more than BEF 750 million.

Self-storage development continued with the opening of the

site in Düsseldorf and the purchase of four units in Paris. The

sites being operated, together with approved projects, currently

represent 70,000 m2. The build-up and start-up losses are so far

in line with the investment plan.

Further administrative changes have prevented sites in

Flanders and Wallonia from entering into service as soon as

planned.

Overall, taking into account start-up losses in the self-

storage business (BEF 63 million), the year ended with a positive

result of BEF 317 million, as all other Group activities made a

positive contribution. The cash flow of this year reached BEF 773

million.


1994 1995 1996 1997

Equity 4,470 4,586 4,132 4,144

Turnover 1,030 431 199 2,508

Net profit (Group share) 400 426 (160) 317

Net profit per share (BEF) 135.5 144.1 (54.3) 107.4


Contribution to :





45

AXA-UAP

With FRF 308 billion of premiums issued and FRF 3,184 billion of assets managed, AXA has, since its merger with UAP,become one of the world’s leading Groups in its fields of insurance and asset management.

The 1997 business year was marked by the completion of

the merger between AXA and UAP, the statutory merger between

the two Groups having been ratified by the General Meetings

held in May 1997.

A new management team was installed in order to complete

the creation of the new Group rapidly. In France, loss activities

were restructured and, elsewhere, mergers were also initiated

between subsidiaries of the two Groups in Germany, Great

Britain, Spain and Italy.

The accounts for 1997 provide the first snapshot of the

merged Group, which achieved turnover of FRF 364.6 billion, a

consolidated net profit of FRF 13.2 billion and net profit (Group

share) of FRF 7.9 billion.

Insurance in France now accounts for 25% of the new

Group’s turnover, with a contribution to the Group share in net

profit amounting to FRF 2,023 million.

Insurance activities in Europe, excluding France, account for

31% of Group turnover, while their contribution to the Group

share of net profit amounted to FRF 3,857 million, helped by the

favourable level of profit from financial management.

North America accounts for 15% of turnover and a contri-

bution of FRF 533 million to the Group share of net profit.

Elsewhere, reinsurance made a contribution of FRF 813 mil-

lion to the Group share of net profit, while the Asia-Pacific zone

made a contribution of FRF 261 million. Cross-border activities

made a loss of FRF 387 million. Together, the contribution made

by insurance and reinsurance activities to the Group share of net

profit came to FRF 7,100 million.

Financial Services, with the core activity of managing

assets for third parties, account for 16% of Group turnover, their

contribution to the Group share of net profit amounting to

FRF 2,415 million.

After deduction of FRF 1,595 million for charges from

holding companies (financial charges, depreciation of goodwill

and overheads), the Group share of net profit amounts to

FRF 7,920 million, or FRF 22.8 per share.

Key consolidated figures (FRF million) (1)

1994 1995 1996 1997

Equity capital before distribution 40,386 35,624 32,024 78,671

Premiums issued 151,606 157,644 152,746 307,546

Net profit (Group share) 1,568 (2,065) (6,446) 7,920

Net profit per share (FRF) 5.3 (6.7) (19.1) 22.8

Dividend per share (FRF) 3.0 3.0 3.0 9.0

Contribution to :




Estimated value at 31.12.1997 – – 990 38.2

(1) Figures for 1994 to 1996 are for UAP only.

47

Imétal

The IMÉTAL Group’s activities revolve around three industries : construction materials (earthenware tiles and bricks, natural slate and advanced ceramics),

industrial minerals (calcium carbonate, kaolin, graphite, refractory clays and ceramic clays) and metal processing (manufacturing precision mechanical and structural tubes and bimetallic conductors).

In 1997, IMÉTAL benefited from the improved economic

situation in Europe, the still high levels of growth in the United

States, and the results of its active internal and external expan-

sion policy. IMÉTAL made industrial investments to the value of

FRF 800 million and acquired shareholdings worth a total of

FRF 700 million. The most significant of these were FERRUM,

the market leader in Canada for mechanical and structural tubes

and NORD KAOLIN, which strengthens the reserves and the

capacity of DRY BRANCH KAOLIN in Georgia.

Turnover was in excess of FRF 11 billion, a rise of 36%

(6.3% with a constant perimeter). Below are the results by

branch of activity:

• in construction materials, the turnover of FRF 2,909 million

was up by 6% using a constant perimeter. Trade in tiles, bricks

and roofing products was significantly higher, although the mar-

ket for slates was depressed and the advanced ceramics business

suffered from less favourable trading conditions;

• in industrial minerals, the turnover of FRF 4,270 million also

showed a rise of 6% on a constant perimeter and exchange rates

basis. Added to this were 9% for the rise in the USD and 22% for

changes in the perimeter, in particular the acquisitions of

PLIBRICO in 1996 and NORD KAOLIN in 1997;

• in metal processing, turnover of FRF 3,872 million showed a

rise of 8% with the same perimeter and at constant exchange

rates. The impact of the rise in the USD on the turnover was

15%, and that of the incorporation, as from 1 May 1997, of

FERRUM in Canada and the tubes division of TITAN in the

United States was 54%.

Operating income was up by 25% at FRF 1.206 million com-

pared with FRF 968 million in 1996. Net operating income

(Group share) of FRF 660 million was up by 8.9% compared with

1996. Taking into account the net exceptional earnings of

FRF (40) million, including FRF (38) million for the amortisation

of goodwill, net earnings (Group share) totalled FRF 620 million

compared with FRF 614 million in 1996.

A proposal will be put to the next Annual General Meeting

for the payment of a net dividend of FRF 17.5 per share com-

pared with FRF 16 per share in the previous year, giving a total

distribution of FRF 261 million.

In March 1998, PARFINANCE and IMÉTAL have announced

their intent to marge, subject to the approval of both their

General Meetings.


1994 1995 1996 1997

Equity 5,038 5,329 5,849 6,573

Turnover 7,510 7,737 8,100 11,051



Gross dividend before tax per share (FRF) 12.5 14.5 16.0 17.5

Contribution to :






1994 1995 1996 1997

Equity 2,601 1,243 1,330 1,491

Turnover 1,084 1,072 1,081 1,102


Dividends – 1,482 100 100

Contribution to :





48

ACP

ACP is the leading supplier of carbon dioxide in all its various forms (bulk, cylinders and dry ice) in the Belgian market,and also runs operations in bordering countries. ACP owns 100 % of ANTWERP GAS TERMINAL (AGT), a company

operating a gas loading, storage and distribution terminal in the port of Antwerp.

In 1997, the bulk CO2 business put in a solid performance

compared with the previous year, largely due to better econo-

mic conditions for the industry, and despite limited production

capacity in the spring of 1997 when one source of supply was

shut down for a major overhaul.

Sales of CARBOGLACE® achieved record volumes which

resulted in higher earnings.

Gas cylinders, primarily for the catering sector, have seen a

gradual erosion of their market over the past few years. The intro-

duction by ACP of new technology (minitank) and revitalisation

of the distribution network should allow it to take on the fierce

competition which is putting downward pressure on margins.

The construction of the new CARBODOUR production unit

at Tertre is progressing according to plan and should allow pro-

duction to start up in the spring of 1998. ACP concluded major

supply contracts which will enable it to forge ahead with this

new investment (totalling more than BEF 300 million) under

favourable conditions.

The ANTWERP GAS TERMINAL had an exceptional year,

thanks to excellent business volumes, which for the first time

exceeded one million tons, permitting AGT to contribute a fi-

gure of some BEF 160 million to the consolidated income.

The ACP Group also has financial subsidiaries whose

earnings were favourably influenced by the excellent perfor-

mance of the stock markets and the appreciation of the USD and

the GBP.

The Company plans to propose to the next Annual General

Meeting the payment of a total dividend of BEF 100 million.

49

HÉLIO CHARLEROI is active in the magazine, catalogue and advertising brochure printing business. Alongside HÉLIOCOLOR, ROTOCALCO and HÉLIO CORBEIL, which belong to the HACHETTE Group, its production unit forms part of a

group of four graver printing companies operating throughout Europe. HÉLIO CHARLEROI is 50% owned by GROUPE JEANDUPUIS and 50% by E2G, the industrial arm of the HACHETTE FILIPACCHI MEDIA Group.

The year 1997 was exceptional for HÉLIO CHARLEROI; its

plant was operating near full capacity with the tonnage printed

in excess of 70,000 tonnes (62,000 in 1996). This tonnage makes

HÉLIO CHARLEROI the undisputed leader in heliogravure

printing in Belgium with a market share of 60%. New contracts

ensured that the binding unit was also working at full capacity.

This exceptional workload pushed the before-tax profit to a

record high of BEF 184 million (compared with BEF 102 million

in 1996), despite the fact that for the last time this year, the use

of accelerated depreciation had an effect on the profit before tax

of around BEF 54 million.

The losses incurred when starting up the enterprise were

therefore fully recovered and the company’s equity capital now

stands at BEF 448 million, together with an allocation to acce-

lerated amortisation exceeding normal amortisation by BEF 200

million.

Finally, the cash flow resulting from these good earnings

made it possible to accelerate reimbursement of HÉLIO

CHARLEROI’s debt bringing it down to BEF 133 million by

31 December 1997.


1994 1995 1996 1997

Equity 192 230 329 448

Turnover 1,507 2,229 2,018 2,138


Dividends – – – –

Contribution to :





Hélio Charleroi

51

The ORIOR Group currently holds two main categories of assets :• an agri-food business, the dominant asset, comprised of companies with a leading position in the Swiss market ;

• the STERN group, operating in the top-of-the-range watch components sector .

During the past year the ORIOR Group continued to make

investments, strengthening its existing shareholdings. ORIOR

acquired 100% of TRAITEUR SEILER, a company in the business

of fresh pasta production, increased its holding in the capital of

TRINCA from 60% to 100%, and bought an additional 20% of the

capital of FREDAG, bringing its holding up to 88%. The Group

also continued to finance the construction of the new poultry unit

in China which should enter into service in September 1997.

Consolidated turnover for the group in the foodstuffs sector

totalled CHF 273.2 million, a rise of 5.7% with a constant perime-

ter compared with the previous year.

The legal and financial structures of the food group under-

went a major reorganisation in the second half of 1997. Several

companies previously owned by ORIOR HOLDING were merged

and regrouped under ORIOR FOOD, bringing its share capital up

from CHF 14.4 million to CHF 30.8 million. This simplification

of the structure of the various units allowed rationalisation of the

management and made it easier to exploit operational synergies.

It was a mixed year at STERN, marked by slightly less activ-

ity in the first half, although the second half was very busy.

STERN’s consolidated turnover totalled CHF 40.6 million, down

by 9.2% compared with the previous year. This trend was due to

the sensitivity of STERN’s performance to changes in fashion for

jewellery watch dials. Under the direction of its new manager, the

STERN Group has been remodelled. The order book at the begin-

ning of 1998 was at a high level, reflecting the current good eco-

nomic situation and the quality of relations between STERN and

its clientele.

Net consolidated operating income (Group share) stood at

CHF 7.2 million. The fall compared with the 1996 figure is

mainly due to rising prices for certain essential raw materials in

the food sector, start-up costs for new manufacturing centres at

Ticino and in China, and financial costs associated with the

LMBO debt of the STERN Group.

Net consolidated operating income for the ORIOR Group

stands at CHF 1.6 million, depressed by an exceptional write-off

of goodwill of CHF 7.6 million on the shareholding in the STERN

Group.

A proposal will be put to the Annual General Meeting sug-

gesting the payment of a dividend of CHF 33 per share,

unchanged on last year, with distribution of a total of

CHF 7.1 million.

Orior Holding

Key consolidated figures (CHF million)

1994 1995 1996 1997

Equity 162.3 178.5 178.1 172.6

Net profit (Group share) 19.8 12.4 6.8 1.6

Net profit per share (CHF) 98.4 57.4 31.4 7.3

Gross dividend per share (CHF) 32.0 33.0 33.0 33.0

Contribution to :




Estimated value at 31.12.1997 – – 981 37.9

52

Ijsboerke

IJSBOERKE, number two in the Belgian ice cream market, was acquired by NPM/CNP at the end of 1997.The Group’s activities include manufacturing its own brand products essentially for the domestic market,

and private label products for export.

The outstanding feature of the Group, on the Belgian mar-

ket, is a fleet of around 170 trucks which ply the country

making direct sales of IJSBOERKE products to the households of

300,000 clients ; sales through wholesalers are relatively mar-

ginal compared with those made through its own network.

IJSBOERKE products enjoy a good reputation amongst cus-

tomers in terms of quality and quality/price ratio but remain

very traditional.

The performance and profitability of IJSBOERKE, as reflec-

ted in the annual accounts for 1997 and previous years, are not

truly representative, in the opinion of NPM/CNP, of the real

potential profitability of the Group.

The year 1998 will be a transition year marked by rein-

forcement of the management structures, redefinition of the

company strategy, reorientation of advertising expenditure and

revitalisation of the sales network, efforts in the control of pur-

chases and production costs and optimization of its production

and storage capacity which are currently significantly under-

used.

IJSBOERKE is aware of the challenge facing it, but is calm

and confident of its abilities and the resources at its disposal.


1994 1995 1996 1997

Equity 223 188 209 210

Turnover 1,978 2,017 1,795 1,819


Dividend – – – –

Contribution to :



Operating result 1997 – – – –


53

The SUZY Group has three operating units :

• SUZY (Buizingen, Belgium) manufactures and markets waf-

fles, both under its own brand name and for major retailers. The

SUZY brand, the only brand name with a genuine reputation in

the waffle sector, began its recovery four years ago and currently

has around 20% of the market. At the beginning of 1998, the

Company also launched a complete range of cakes and confec-

tionery.

• DESOBRY (Tournai, Belgium) produces biscuit assortments for

the mass market and is one of the leading companies in this

segment. Its field of activity is mainly aimed at the export mar-

ket, with substantial turnover in France and the United States.

• DRIEHOEK (Alkmaar, Netherlands) manufactures various

types of industrial confectionery, mainly for the mass market.

Following mediocre results in 1996, depressed by the

effects of charges not directly associated with operations, the

1997 result shows a continuing recovery in the fortunes of the

companies in the SUZY Group. Overall, the food sector

continues to suffer from tight margins, aggravated by the

combined pressure from retailers and the competition.

Energetic measures have been taken to control costs, whilst

maintaining vital research and development efforts and

developing quality controls.

In 1998, SUZY and MILCAMPS FOODS, one of its main

competitors, set up a joint venture with the objective of hous-

ing all waffle production and retailers’ own brands marketing for

the two Groups under the same roof.

53

Suzy

The SUZY Group is one of the leading industrial producers of waffles, biscuits and confectionery in Belgium,

manufacturing both under its own brand and under retailers’ own brands.


1994 1995 1996 1997

Equity n.s. n.s. n.s. 77

Turnover n.s. n.s. n.s. 1,572

Net profit (Group share) n.s. n.s. n.s. 26

Dividends n.s. n.s. n.s. –

Contribution to :





55

CLT-UFA

CLT-UFA, in which AUDIOFINA and BERTELSMANN/WAZ have equal holdings,is the leading European radio and television group.

In Germany, RTL TELEVISION, the leading channel for the

fifth consecutive year with 16.1% of the audience, increased its

profitability by around 20% in 1997. CLT-UFA is expanding its

activities into pay television through PREMIERE which boasted

1.6 million subscribers at the end of 1997. An agreement was

signed with the KIRCH Group with a view to giving each of the

two partners an equal controlling share in PREMIERE, which

would be used as a basis for creating a new digital platform. This

agreement is subject to the approval of the various national

authorities responsible for the media and the European

Commission.

In France, the television channel M6 is, for the second

consecutive year, the only national terrestrial station to see its

viewing figures rise. The digital satellite television company TPS

brought its first year of operations to a brilliant conclusion with

350,000 subscribers. At the beginning of 1998, CLT-UFA reclas-

sified its shareholding in TPS which was sold to M6 and SUEZ

LYONNAISE DES EAUX. RTL confirmed its position as the mar-

ket leader in radio broadcasting for the sixteenth successive year,

while RTL2 succeeded in doubling its turnover. CLT-UFA has

begun the process of bringing together its three radio stations:

RTL, RTL2 and FUN RADIO.

In the Netherlands, the television channel RTL 4 is leading

the field with an audience share

of 21%, directly followed by

VERONICA, the Group’s second

channel in this market with an

audience of 10.5%. In compliance

with the ruling of the European

Commission, RTL 5 was

relaunched in a new format as a

news channel. In French-spea-

king Belgium, radio BEL RTL pro-

duced excellent results, attracting

for the first time ever an audience in excess of one million lis-

teners.

Having obtained the last terrestrial channel available in the

United Kingdom, on 30 March 1997 CLT-UFA launched the ge-

neral audience CHANNEL 5, which performed in line with

expectations over its first nine months of operations, despite ini-

tial difficulties.

The Group’s first investment in television in eastern Europe,

the general interest channel RTL 7, distributed in Poland by cable

and satellite, achieved fourth position one year after its launch

in December 1995 with an audience of 2.5%. RTL KLUB, the se-

cond commercial channel in the country, launched in Hungary

in October 1997, established itself with 19% of the market bare-

ly three months after its launch.

In order to control sales of advertising space on its opera-

tions, CLT-UFA acquired IP/HAVAS INTERMEDIATION for

FRF 860 million. In addition, CLT-UFA continued to expand into

the strategic sectors of sporting and fiction rights, as well as pro-

duction.

In 1997, following these major investments, in the first year

after the merger, CLT-UFA produced a net consolidated loss of

LUF 2.9 billion compared with a LUF 3.4 billion profit in 1996,

in line with predictions. The profitability of its core businesses

should grow by more than 50%,

achieving an estimated level of

LUF 7 billion, mainly through

RTL TELEVISION and the most

important profit centres. In paral-

lel, CLT-UFA will make major

investments in the PREMIERE

digital pay television channel in

Germany, as well as in other pro-

jects, hence the expected overall

loss of LUF 8 billion for 1998.

Key consolidated figures (LUF million)

1994 1995 1996 1997


Turnover 84,768 91,192 92,766 114,067

Net profit (Group share) 3,307 3,335 3,372 (2,882)

Dividends 1,333 1,437 1,461 n.a.

Contribution to :



Operating result 1997 – – (38) (1.5)


56

Éditions Dupuis

ÉDITIONS DUPUIS is the world leader in French-language cartoon strip books with annual sales of around 11 million albums. Using this business as a platform, the company has developed peripheral activities in audio-visual,licensing, the sale of publishing rights, direct marketing and the commercialisation of products from other publishers.

DUPUIS also publishes the last major cartoon strip weekly, the Journal de Spirou.

Once again, 1997 was a year of growth for both turnover

and profitability at ÉDITIONS DUPUIS.

Sales of albums in French-speaking and Dutch-speaking

markets reached a historic high, largely thanks to a special re-

issue of an album celebrating 40 years of GASTON LAGAFFE.

On this occasion, more than one million albums were sold.

The Journal de Spirou continued to recover and now makes

a positive contribution to the profitability of the Group.

A number of important licensing deals were made with

major clients such as the QUICK and PETROFINA groups.

The distribution of albums from ÉDITIONS DE BALLON, a

33% owned company, in the French and Swiss markets was

carried out by DUPUIS and grew substantially in 1997.

In the audio-visual field, MEDIATOON, a 100% subsidiary

of ÉDITIONS DUPUIS, finalised the production of FLASH

GORDON, which was broadcast on FRANCE 3.

The year 1998 will be marked by the distribution of the

series of PAPYRUS cartoon films (39 episodes of 26 minutes) co-

produced by the Parisian studios of ÉDITIONS DUPUIS France

and TF1. The characters from PAPYRUS will be the focus of

other major operations involving 20 album titles already in the

DUPUIS catalogue and a new range of publications, as well as

various licensing and promotion activities.

Thanks to the synergy in its portfolio of businesses,

ÉDITIONS DUPUIS is looking to the future with serenity. The

dividend for the year rose to BEF 85 million.


1994 1995 1996 1997

Equity (before distribution) 686 692 762 783

Turnover 1,637 1,675 1,799 2,057


Dividends 30 36 75 85

Contribution to :





59

CONSOLIDATED ACCOUNTS

Introductory comments..................................................................................................... 60

Key figures........................................................................................................................ 61

Balance sheets................................................................................................................. 62

Profit and loss statements ................................................................................................ 64

Balance sheets - notes..................................................................................................... 66

Analytical profit and loss statements ................................................................................ 70

Profit and loss statements - notes.................................................................................... 71

Appendix........................................................................................................................... 73

Statements of cash flows ................................................................................................. 81

Statements of cash flows - notes ..................................................................................... 82

Auditors’ report ................................................................................................................. 83

PARJOINTCO - summary consolidated accounts ........................................................... 84

Summarized financial statements of major non-listed shareholdings .............................. 90

60


INTRODUCTORY COMMENTS

Since 1990, NPM/CNP has made public consolidated accounts including, using the equitymethod, PARJOINTCO (itself consolidating PARGESA and therefore incorporating GBL andPARFINANCE) and shareholdings of at least 20 % in companies held by the Group.

The Company also publishes restricted consolidated accounts which only incorporate fullyowned financial companies, as well as AGESCA NEDERLAND (89.54 %) and its subsidiaryN.F. ASSOCIATES, and the proportional inclusion of the statutory accounts of the jointlycontrolled PARJOINTCO, GROUPE JEAN DUPUIS and CENTRE DE COORDINATION DECHARLEROI.

The restricted consolidated accounts only include, in addition to the results of financialcompanies controlled by NPM/CNP, the flows of dividends (as opposed to the results, in theconsolidated accounts) for PARGESA and for equity accounted companies in which it has aholding of at least 20 % (ACP, BERNHEIM-COMOFI, ÉDITIONS DUPUIS, HÉLIOCHARLEROI, PETROFINA, ROYALE BELGE, TRANSCOR, SCI & ASSOCIÉS up to June1996 and SUZY as from 1997).

Please note the following :

� As NPM/CNP owned the SUZY Group (comprised of three entities : SUZY, DESOBRYand DRIEHOEK) at the beginning of 1997, the results of this Group were equityaccounted in the consolidated accounts of NPM/CNP as from 1997.

� As IJSBOERKE was not acquired by NPM/CNP until December 1997, this Group was onlyequity accounted on the balance sheet, as at 31 December 1997 ; it will only contribute tothe consolidated results of NPM/CNP as from 1998.

� Following the capital gains made in 1996 (TRACTEBEL) and 1997 (50 % of CLT andBBL) within the PARGESA Group, it was decided to proceed with an exceptionaldepreciation of the goodwill which had negatively affected the earnings of the NPM/CNPGroup by BEF 411 million in 1996, and by BEF 278 million in 1997.

� Finally, during 1997, PETROFINA adopted American accounting methods (US GAAP) ;NPM/CNP’s share of the resulting decrease in the equity of PETROFINA(BEF 583 million) was posted as a reduction in the consolidated reserves.

61


KEY FIGURES

Consolidated accounts Restricted consolidated accounts

(BEF thousand except for data per share) 1997 1996 1995 1997 1996 1995

EQUITY

� total 61,323,309 55,556,575 52,172,585 55,298,283 54,227,614 52,693,654

� Group share 58,815,540 53,486,338 50,526,275 53,602,196 52,588,592 51,350,577

� minority interests 2,507,769 2,070,237 1,646,310 1,696,087 1,639,022 1,343,077

NET PROFIT

� total 8,103,565 5,253,325 2,451,973 3,718,296 3,881,119 2,152,229

� Group share : 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

� operating income 4,820,637 3,935,461 3,604,356 2,850,102 2,616,402 2,589,112� capital result 2,878,189 1,147,203 (1,240,701) 806,595 1,209,772 (488,816)

including amortisation of goodwill (transitively) (1) (665,598) (769,204) (403,248) - (821) -

� minority interests 404,739 170,661 88,318 61,599 54,945 51,933

GROSS DIVIDENDS 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188

NUMBER OF SHARES IN ISSUE 25,340,000 25,340,000 25,340,000 25,340,000 25,340,000 25,340,000

ADJUSTED DATA PER SHARE (in BEF)

� operating income 190.24 155.31 142.24 112.47 103.25 102.17

� capital result 113.58 45.27 (48.96) 31.83 47.74 (19.29)

including amortisation of goodwill (transitively) (1) (26.27) (30.36) (15.91) - (0.03) -

� earnings per share 303.82 200.58 93.28 144.31 150.99 82.88

� gross dividend per ordinary share 104.00 102.00 100.00 104.00 102.00 100.00

(1) Includes amortisation of goodwill by NPM/CNP as well as NPM/CNP’s transitive share in the amortisation of goodwill recorded by its financial subsidiaries and byPARJOINTCO, PARGESA, GBL, PARFINANCE and the sub-holdings controlled by those groups.

62


BALANCE SHEETS

ASSETS (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995

FIXED ASSETS 51,276,777 46,390,729 49,787,068 45,456,168 45,244,680 50,441,983I. Formation expenses - - - - - -II. Intangible assets - - - - - -III. Goodwill 3,001,383 1,998,161 2,199,310 - - -IV. Tangible fixed assets 346,157 220,486 76,737 346,323 220,689 76,986

A. Land and buildings 48,446 20,541 28,539 48,446 20,541 28,539B. Plant, machinery and equipment - - - - - -C. Furniture and vehicles 89,249 17,323 9,032 89,415 17,526 9,281D. Leasing and other similar rights - - - - - -E. Other tangible assets 208,462 - - 208,462 - -F. Assets under construction and advance

payments - 182,622 39,166 - 182,622 39,166V. Investments 47,929,237 44,172,082 47,511,021 45,109,845 45,023,991 50,364,997

A. Equity-accounted companies 37,602,032 32,424,814 35,151,974 - - -1. Shares 37,327,032 32,349,814 33,303,978 - - -2. Bonds 275,000 75,000 1,847,996 - - -

B. Other companies 10,327,205 11,747,268 12,359,047 45,109,845 45,023,991 50,364,9971. Stocks and shares 10,327,196 11,747,262 12,359,040 44,834,836 44,948,985 48,516,9942. Bonds and other amounts receivable 9 6 7 275,009 75,006 1,848,003

CURRENT ASSETS 23,008,325 23,464,663 13,423,037 23,024,354 23,520,320 13,498,005VI. Amounts receivable after more than one year - - - - - -

A. Trade receivables - - - - - -B. Other receivables - - - - - -

VII. Stocks and contracts in progress - - - - - -A. Stocks - - - - - -B. Contracts in progress - - - - - -

VIII. Amounts receivable within one year 7,389,086 9,201,745 3,577,524 7,199,180 9,070,976 3,579,505A. Trade receivables 44,389 7,023 7,045 44,389 7,023 7,045B. Other receivables 7,344,697 9,194,722 3,570,479 7,154,791 9,063,953 3,572,460

IX. Short-term investments 9,103,336 7,006,513 6,050,957 9,285,946 7,189,652 6,079,693A. Own shares 747,018 872,095 - 747,018 872,095 -B. Other investments and deposits 8,356,318 6,134,418 6,050,957 8,538,928 6,317,557 6,079,693

X. Cash at bank and in hand 6,224,919 7,161,654 3,633,138 6,243,808 7,164,153 3,677,372XI. Deferred expenses and accrued income 290,984 94,751 161,418 295,420 95,539 161,435

TOTAL ASSETS 74,285,102 69,855,392 63,210,105 68,480,522 68,765,000 63,939,988

63


BALANCE SHEETS

LIABILITIES AND EQUITY (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995

EQUITY 58,815,540 53,486,338 50,526,275 53,602,196 52,588,592 51,350,577I. Share capital 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250

A. Issued capital 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250B. Uncalled capital - - - - - -

II. Share premium account 42,824,428 42,824,428 42,824,428 42,824,428 42,824,428 42,824,428III. Revaluation surplus - - - - - -IV. Reserves 13,107,417 8,627,375 6,129,391 5,966,524 4,945,187 3,703,693V. Negative goodwill 214,634 226,029 222,231 149,459 149,459 149,459VI. Translation adjustments (2,082,189) (2,942,744) (3,401,025) (89,465) (81,732) (78,253)VII. Investment grants - - - - - -

MINORITY INTERESTS 2,507,769 2,070,237 1,646,310 1,696,087 1,639,022 1,343,077VIII. Minority interests 2,507,769 2,070,237 1,646,310 1,696,087 1,639,022 1,343,077

PROVISIONS AND DEFERRED TAXATION 38,000 41,500 303,357 38,000 41,500 269,250IX. A. Provisions for liabilities and charges 38,000 41,500 303,357 38,000 41,500 269,250

1. Pensions and similar obligations - - - - - -2. Tax provisions - - - - - -3. Major repairs and maintenance - - - - - -4. Other liabilities and charges 38,000 41,500 303,357 38,000 41,500 269,250

B. Deferred taxation - - - - - -

LIABILITIES 12,923,793 14,257,317 10,734,163 13,144,239 14,495,886 10,977,084X. Amounts payable after more than one year 3,273,750 3,273,750 3,273,750 3,508,668 3,493,032 3,510,311

A. Financial liabilities 3,273,750 3,273,750 3,273,750 3,508,668 3,493,032 3,510,3111. Subordinated loans - - - - - -2. Unsubordinated debentures 3,273,750 3,273,750 3,273,750 3,273,750 3,273,750 3,273,7503. Finance leasing liabilities - - - - - -4. Amounts due to financial institutions - - - 234,918 219,282 236,5615. Other loans - - - - - -

B. Trade payables - - - - - -1. Suppliers - - - - - -2. Notes payable - - - - - -

C. Advances received on contracts in progress - - - - - -D. Other liabilities - - - - - -

XI. Amounts payable within one year 9,179,586 10,737,303 7,139,612 9,152,745 10,742,200 7,139,607A. Current portion of long-term debt - - - - - -B. Financial debts 6,255,298 7,662,381 4,238,123 6,255,298 7,664,054 4,238,123

1. Amounts due to financial institutions 1,692,793 1,462,116 1,338,123 1,692,793 1,462,116 1,338,1232. Other loans 4,562,505 6,200,265 2,900,000 4,562,505 6,201,938 2,900,000

C. Trade payables 38,872 47,852 24,586 38,872 47,852 24,5861. Suppliers 38,872 47,852 24,586 38,872 47,852 24,5862. Notes payable - - - - - -

D. Advances received on contracts in progress - - - - - -E. Taxes, salaries and social charges payable 135,746 114,170 53,786 135,746 117,394 53,786

1. Taxes 130,256 108,775 48,954 130,256 111,999 48,9542. Salaries and social charges 5,490 5,395 4,832 5,490 5,395 4,832

F. Other liabilities 2,749,670 2,912,900 2,823,117 2,722,829 2,912,900 2,823,112XII. Accrued expenses and deferred income 470,457 246,264 320,801 482,826 260,654 327,166

LIABILITIES AND EQUITY 74,285,102 69,855,392 63,210,105 68,480,522 68,765,000 63,939,988

64


PROFIT AND LOSS STATEMENTS

EXPENSES (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995A. Interest expense 402,002 444,711 465,452 420,794 456,316 475,140B. Other financial expense 164,892 155,541 283,405 191,119 156,916 290,532B.bis Amortisation of goodwill 155,820 152,436 155,420 - 821 -C. Miscellaneous goods and services 89,367 86,086 70,428 90,758 86,086 72,220D. Payroll expenses 89,274 79,538 79,369 105,745 96,522 83,452E. Miscellaneous operating expenses 10,122 7,249 4,362 10,122 7,249 4,362F. Depreciation and write-off of formation expenses,

tangible and intangible assets 17,021 3,003 6,241 17,058 3,049 6,297G. Write-down on 127,427 252,463 703,407 127,427 252,463 741,234

1. long-term investments - 249,330 556,403 - 249,330 594,2302. current assets 127,427 3,133 147,004 127,427 3,133 147,004

H. Provisions for liabilities and charges - - 6,410 - - 6,410I. Losses on disposal of 130 16,295 17,709 130 16,295 17,709

1. tangible and intangible fixed assets 88 15 293 88 15 2932. long-term investments - - 3,937 - - 3,9373. current assets 42 16,280 13,479 42 16,280 13,479

J. Exceptional expenses 33,168 105,754 136,000 33,168 105,754 136,000K. Taxes 49,283 59,219 29,791 49,283 65,970 29,791K.bis Losses of equity-accounted companies - 37,528 47,997 - - -L. Profit for the period 8,103,565 5,253,325 2,451,973 3,718,296 3,881,119 2,152,229L.bis Minority interests in profit 404,739 170,661 88,318 61,599 54,945 51,933L.ter Group share of profit 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

TOTAL EXPENSES 9,242,071 6,653,148 4,457,964 4,763,900 5,128,560 4,015,376

Appropriation of profitC. Transfers to / (from) reserves 5,063,466 2,497,984 (188,533) 1,021,337 1,241,494 (451,892)

1. Consolidated reserves 5,063,466 2,497,984 (188,533) 1,021,337 1,241,494 (451,892)F. Profit to be distributed 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188

1. Dividend to shareholders 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188

7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

65



REVENUES (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995A. Revenue from investments 508,429 575,358 596,138 2,220,810 2,241,655 2,579,858

1. Dividends 497,201 533,414 514,519 2,209,582 2,199,711 2,498,2392. Interests 11,228 41,944 81,619 11,228 41,944 81,619

B. Revenue from current assets 744,684 663,277 652,176 757,465 668,823 653,281C. Other financial revenue 157,318 182,514 95,620 157,318 204,249 95,620D. Revenue from services rendered 40,351 27,679 26,274 40,351 27,679 26,274E. Other operating revenue 53,746 44,338 47,003 53,746 44,338 47,003F. Reversals of depreciation or write-off of tangible

and intangible assets 15,509 16,277 35,137 - - -G. Write-back of 60,576 426,403 53,291 60,576 426,403 53,291

1. long-term investments 39,729 324,441 - 39,729 324,441 -2. current assets 20,847 101,962 53,291 20,847 101,962 53,291

H. Reversals of provisions for liabilities and charges 3,500 - 2,500 3,500 - 2,500I. Profits on disposal of 1,446,251 1,080,054 538,995 1,462,152 1,373,408 538,995

1. tangible and intangible fixed assets 578 108 - 578 108 -2. long-term investments 783,637 849,051 8,489 799,538 1,142,405 8,4893. current assets 662,036 230,895 530,506 662,036 230,895 530,506

J. Exceptional revenue 6 136,238 - 6 136,238 -K. Taxation adjustments and reversals of tax provisions 2,518 5,767 15,436 7,976 5,767 18,554K.bis Profits of equity-accounted companies 6,209,183 3,495,243 2,395,394 - - -L. Loss for the period - - - - - -L.bis Minority interest in loss - - - - - -L.ter Group share of loss - - - - - -

TOTAL REVENUES 9,242,071 6,653,148 4,457,964 4,763,900 5,128,560 4,015,376

Appropriation of profitA. Profit available for appropriation 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

1. Profit for the period 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

66


BALANCE SHEETS - NOTES

ASSETS (BEF thousand)

III. GoodwillThis represents the excess of the cost of investments in subsidiaries and equity-accounted companies over the value of NPM/CNP’s share oftheir net assets on the date of acquisition or initial consolidation and is analysed as follows :

Grossamounts

Cumulativeamortisation

Consolidatednet amounts

au 31.12.1997 au 31.12.1997 1997 1996 1995PETROFINA 2,326,927 (908,424) 1,418,503 1,611,016 1,730,504IJSBOERKE 1,266,420 - 1,266,420 - -ROYALE BELGE 477,096 (211,004) 266,092 331,916 410,202BERNHEIM-COMOFI 82,303 (31,935) 50,368 54,483 58,604SUZY 10,756 (10,756) - - -ACP 786 (786) - 746 -Total 4,164,288 (1,162,905) 3,001,383 1,998,161 2,199,310

Goodwill is allocated to the investments to which it is related and is amortised at a rate of 5 % per annum. Minor amounts can be written offin full ; this was the case in 1997 for an amount of 10,926. Moreover, additional amortisation is provided when appropriate.

V. InvestmentsA.1 Equity-accounted companies – Shares

Percentage of ownership Consolidated accounts1997 1996 1995 1997 1996 1995

PARJOINTCO 50.00 % 50.00 % 50.00 % 22,556,419 18,966,721 17,757,949PETROFINA 6.41 % 6.46 % 6.46 % 9,996,619 9,204,380 8,438,526SCI & ASSOCIÉS - - 49.00 % - - 2,504,777ROYALE BELGE 2.05 % 2.35 % 2.69 % 1,690,103 1,594,055 1,629,577BERNHEIM-COMOFI 21.69 % 21.69 % 21.69 % 965,283 960,140 1,061,437ACP 28.32 % 28.32 % 28.12 % 454,531 408,818 353,496TRANSCOR 47.59 % 47.59 % 47.59 % 777,813 680,941 596,246ÉDITIONS DUPUIS 50.00 % 50.00 % 50.00 % 391,383 380,873 355,625HÉLIO CHARLEROI 25.00 % 25.00 % 25.00 % 112,065 82,236 57,483IJSBOERKE 100.00 % - - 209,554 - -SUZY 100.00 % - - 106,403 - -Others n.a. n.a. n.a. 66,859 71,650 548,862Total 37,327,032 32,349,814 33,303,978

A.2 Equity-accounted companies – Bonds and other amounts receivableConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995SCI & ASSOCIÉS - - 1,772,996 - - -SUZY 200,000 - - - - -HÉLIO CHARLEROI 75,000 75,000 75,000 - - -Total 275,000 75,000 1,847,996 - - -

67



B.1 Other companies – Stocks and shares

(number of shares held) Consolidated accounts Restricted consolidated accounts1997 1996 1995 1997 1996 1995

ACIDE CARBONIQUE PUR - - - 28,316 28,316 28,121ARTEMIS - 299,592 - - 299,592 296,953BERNHEIM-COMOFI - - - 640,606 640,606 640,606COBEPA 877,261 1,165,435 1,165,435 877,261 1,165,435 1,165,435COMPAGNIE GÉNÉRALE DES EAUX 1,115,335 1,115,335 1,115,335 1,115,335 1,115,335 1,115,335ELF AQUITAINE 1,000,000 1,296,695 1,296,695 1,000,000 1,296,695 1,296,695ESPIRITO SANTO FINANCIAL HOLDING - 263,474 2,047,169 - 263,474 2,047,169ÉDITIONS DUPUIS - - - 639,187 639,187 639,187HÉLIO CHARLEROI GROUPE J. DUPUIS - - - 100,000 100,000 100,000HEXANE (L’Éventail) 210 210 - 210 210 -BELHOLDING - - - 216 - -STARCO TIELEN IJSBOERKE Group - - - 7,119 - -IJSBOERKE I.C.I. - - - 14 - -IMMO TIELEN - - - 102 - -PARGESA registered shares - - - 544,694 544,694 544,694PARGESA bearer shares - - - 396,250 396,250 396,250PARIBAS - - 151,514 - - 151,514PETROFINA - - - 1,501,078 1,501,078 1,501,078ROYALE BELGE - - - 328,668 376,263 429,688SCI & ASSOCIÉS - - - - - 52,432,054SOCIÉTÉ GÉNÉRALE DE BELGIQUE 1,680,791 1,689,185 1,689,185 1,680,791 1,689,185 1,689,185SUZY S.A. - - - 64,400 - -DESOBRY SUZY Group - - - 1,250 - -DRIEHOEK - - - 41 - -TRANSCOR - - - 7,439 7,439 7,439

B.2 Other companies – Bonds and other amounts receivableConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995SCI & ASSOCIÉS - - - - - 1,772,996HÉLIO CHARLEROI - - - 75,000 75,000 75,000SUZY - - - 200,000 - -Other amounts receivable 9 6 7 9 6 7Total 9 6 7 275,009 75,006 1,848,003

VIII. Amounts receivable within one yearB. Other receivables

Consolidated accounts Restricted consolidated accounts1997 1996 1995 1997 1996 1995

Tax receivables 547,505 543,110 509,341 547,505 543,110 509,341Loans to associated companies 6,583,231 8,329,829 3,025,000 6,393,325 8,199,060 3,025,000Receivables related to shares sold 200,422 302,842 - 200,422 302,842 -Others 13,539 18,941 36,138 13,539 18,941 38,119Total 7,344,697 9,194,722 3,570,479 7,154,791 9,063,953 3,572,460

IX. Short-term investmentsA. Own sharesAt 31 December 1997, the NPM/CNP Group held 411,165 of its own shares for a value of 747,018, with a total nominal value of 77,093.Of these own shares 358,966 were held by NPM/CNP (INVESTOR and CARPAR) and 52,199 by FINGEN, an indirect subsidiary. Thedividends received on these shares have been eliminated from the (restricted) consolidated accounts.

B. Other investments and depositsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Shares and bonds 2,208,609 3,245,024 3,259,746 2,208,609 3,428,163 3,288,482Cash deposits 6,147,709 2,889,394 2,791,211 6,330,319 2,889,394 2,791,211Total 8,356,318 6,134,418 6,050,957 8,538,928 6,317,557 6,079,693

68



LIABILITIES AND EQUITY

I. Share capitalThe Board was authorised by the Shareholders’ Meeting of 12 June 1996 to increase the share capital by 2,000,000 and to issue debentureswith conversion or subscription rights which could lead to an increase in the share capital of the same amount. The capital increase by318,750 following the exercise of the warrants currently in issue would be deducted from the authorised capital. The Shareholders’ Meetingof 11 June 1997 authorised the Board of Directors to acquire on the stock market up to 1,500,000 own shares.

IV. ReservesThis records NPM/CNP’s share of profits transferred to reserves by NPM/CNP, its subsidiaries and equity-accounted companies.Movements on the reserve were as follows :


Opening balance 8,627,375 6,129,391 6,317,924 4,945,187 3,703,693 4,155,585

Profit of the year 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296Dividends (2,635,360) (2,584,680) (2,552,188) (2,635,360) (2,584,680) (2,552,188)Change in accounting principles byPETROFINA (583,424) - - - - -Closing balance 13,107,417 8,627,375 6,129,391 5,966,524 4,945,187 3,703,693

V. Negative goodwillNegative goodwill is the difference between the cost of investments in subsidiaries and equity-accounted companies and the value ofNPM/CNP’s share of the equity of these companies at the date of their acquisition or first consolidation.

VI. Translation adjustmentsThese adjustments are the result of movements in the exchange rates of currencies in which the accounts of subsidiaries orequity-accounted companies are expressed. They represent the difference between the value on translation of the assets and liabilities offoreign subsidiaries at the closing rate and their net worth at historic rates as well as the difference arising from the balance sheet beingtranslated at the closing rate while the income statement is translated at the average rate for the year. The differences shown mainly relateto PETROFINA.

VIII. Minority interestsThe minority interests represent 10.5 % of the capital of AGESCA NEDERLAND held by FRÈRE-BOURGEOIS.

IX. Provisions for liabilities and chargesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Potential compensation to FIBELPAR in caseof exercise by ELF AQUITAINE of its putoption on NPM/CNP-shares (provisionreversed in 1996) - - 136,000 - - 136,000FRF exchange hedging costs (liquidationJanuary 1996) - - 126,840 - - 126,840Provisions for COMPAGNIE GÉNÉRALEDES EAUX put options - - 6,410 - - 6,410VITAL SOGEVIANDES potential losses - - 34,107 - - -Removal costs - 20,000 - - 20,000 -Others 38,000 21,500 - 38,000 21,500 -Total 38,000 41,500 303,357 38,000 41,500 269,250

69



X. Amounts payable after more than one yearConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Bonds A (1) 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000Bonds B (2) 1,773,750 1,773,750 1,773,750 1,773,750 1,773,750 1,773,75050 % Group’s share in PARJOINTCO’sborrowing of CHF 18,500,000 (ended14.07.1999 – 4.875 % rate) - - - 234,918 219,282 236,561Total 3,273,750 3,273,750 3,273,750 3,508,668 3,493,032 3,510,311

(1) 30,000 bonds A 6.70 % 1994-1999 each with a nominal value of BEF 50,000(2) 750,000 bonds B 5.0625 % 1994-1999 each with a nominal value of BEF 2,365 and with 2 warrants attached which can be exercised from 1 to 15 June 1994

to 1999 at BEF 2,365 per share

XI. Amounts payable within one yearB. Financial debts


Market rate loans from affiliated companies 4,562,500 6,200,265 2,900,000 4,562,500 6,201,938 2,900,000Foreign currency credits covering short-terminvestments 1,692,793 1,462,116 1,330,973 1,692,793 1,462,116 1,330,973Others 5 - 7,150 5 - 7,150Total 6,255,298 7,662,381 4,238,123 6,255,298 7,664,054 4,238,123

F. Other liabilitiesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Dividends for the year 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188Dividends relating to prior years 8,394 6,398 6,150 8,394 6,398 6,150Liabilities related to share purchases 69,816 315,930 255,625 42,975 315,930 255,625Others 36,100 5,892 9,154 36,100 5,892 9,149Total 2,749,670 2,912,900 2,823,117 2,722,829 2,912,900 2,823,112

RECONCILIATION OF BALANCE SHEET AT 31.12.1997 (RESTRICTED CONSOLIDATED ACCOUNTS - CONSOLIDATED ACCOUNTS)

Other companiesstock and shares

Other assetsand liabilities

GoodwillPositive Negative Consolidated

reservesTranslationadjustments

Minorityinterests

Equity-accounted

companies :shares

Restricted consolidatedaccounts 44,834,836 204,251 - 149,459 5,966,524 (89,465) 1,696,087 -

Equity-accounted companies :

PARJOINTCO/PARGESA (1) (15,535,950) (231,092) - - 6,573,280 (133,401) 811,682 22,556,419ACP (579,679) - - 2,760 (128,077) 169 - 454,531BERNHEIM-COMOFI (920,793) - 50,368 337 93,601 920 - 965,283ÉDITIONS DUPUIS (300,565) - - 21,030 69,788 - - 391,383HÉLIO CHARLEROI (25,220) - - 9,328 77,517 - - 112,065IJSBOERKE (1,449,132) 26,841 1,266,419 - - - 209,554PETROFINA (13,718,132) - 1,418,504 - (412,442) (1,890,567) - 9,996,619ROYALE BELGE (1,521,339) - 266,092 - 434,626 230 - 1,690,103SUZY (76,987) - - - 29,416 - - 106,403TRANSCOR (325,521) - - 31,720 390,647 29,925 - 777,813Others (54,322) - - - 12,537 - - 66,859

Effect of equity accounting (34,507,640) (204,251) 3,001,383 65,175 7,140,893 (1,992,724) 811,682 37,327,032

Consolidated accounts 10,327,196 - 3,001,383 214,634 13,107,417 (2,082,189) 2,507,769 37,327,032

(1) Relates to PARGESA shares held, in the restricted consolidation, by PARJOINTCO.

70


ANALYTICAL PROFIT AND LOSS STATEMENTS

(BEF thousand) Consolidated accounts Restricted consolidated accountsNote 1997 1996 1995 1997 1996 1995

Revenue from long-term investments 4,226,935 3,621,363 3,208,863 2,220,810 2,241,655 2,163,251Dividends 1 497,201 533,414 514,519 2,209,582 2,199,711 2,081,632Interests 2 11,228 41,944 81,619 11,228 41,944 81,619Operating income - in profitfrom equity-accounted companies - in loss

33

3,718,506-

3,083,533(37,528)

2,614,877(2,152)

--

--

--

Other financial income and expenses 890,522 558,983 601,331 858,284 573,284 585,621Revenue from current assets 744,684 663,277 652,176 757,465 668,823 653,281Interest expense (402,002) (444,711) (465,452) (420,794) (456,316) (475,140)Profits on disposal of current assets 662,036 230,895 530,506 662,036 230,895 530,506Losses on disposal of current assets (42) (16,280) (13,479) (42) (16,280) (13,479)Write-down on current assets (127,427) (3,133) (147,004) (127,427) (3,133) (147,004)Write-back on current assets 20,847 101,962 53,291 20,847 101,962 53,291Other financial revenue 157,318 182,514 95,620 157,318 204,249 95,620Other financial expense (164,892) (155,541) (104,327) (191,119) (156,916) (111,454)

Net overheads (108,187) (103,859) (90,659) (126,086) (120,889) (96,590)Miscellaneous goods and services (89,367) (86,086) (70,428) (90,758) (86,086) (72,220)Payroll expenses (89,274) (79,538) (79,369) (105,745) (96,522) (83,452)Depreciation (17,021) (3,003) (5,867) (17,058) (3,049) (5,923)Provisions for liabilities and charges 3,500 - (3,910) 3,500 - (3,910)Miscellaneous operating expenses (10,122) (7,249) (4,362) (10,122) (7,249) (4,362)Revenue from services rendered 40,351 27,679 26,274 40,351 27,679 26,274Other operating revenue 53,746 44,338 47,003 53,746 44,338 47,003

Taxes on operating income (46,765) (15,952) (14,355) (41,307) (22,703) (11,237)

Minority interests (141,868) (125,074) (100,824) (61,599) (54,945) (51,933)

Operating income (Group share) 8 4,820,637 3,935,461 3,604,356 2,850,102 2,616,402 2,589,112In BEF/share 190.24 155.31 142.24 112.47 103.25 102.17

Revenue from long-term investments 2,490,677 411,710 (265,328) - - 416,607Exceptional dividends - - - - - 416,607Capital results - in profitfrom equity-accounted companies - in loss

44

2,490,677-

411,710-

-(265,328)

--

--

--

Operations on long-term investments 823,366 924,162 (551,851) 839,267 1,217,516 (589,678)Profits on disposals 5 783,637 849,051 8,489 799,538 1,142,405 8,489Losses on disposals - - (3,937) - - (3,937)Write-down on long-term investments 6 - (249,330) (556,403) - (249,330) (594,230)Write-back on long-term investments 6 39,729 324,441 - 39,729 324,441 -

Goodwill amortisation (140,311) (136,159) (120,283) - (821) -Amortisation (155,820) (152,436) (155,420) - (821) -Reversals 15,509 16,277 35,137 - - -

Other capital results (32,672) 30,577 (315,745) (32,672) 30,577 (315,745)Profits on disposal of tangible assets 578 108 - 578 108 -Losses on disposal of tangible assets (88) (15) (293) (88) (15) (293)Exceptional revenue 7 6 136,238 - 6 136,238 -Exceptional expenses 7 (33,168) (105,754) (315,452) (33,168) (105,754) (315,452)

Taxes on capital results - (37,500) - - (37,500) -

Minority interests (262,871) (45,587) 12,506 - - -

Capital results (Group share) 8 2,878,189 1,147,203 (1,240,701) 806,595 1,209,772 (488,816)In BEF/share 113.58 45.27 (48.96) 31.83 47.74 (19.29)

Net profit (Group share) 8 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296In BEF/share 303.82 200.58 93.28 144.31 150.99 82.88

71


PROFIT AND LOSS STATEMENTS - NOTES

Note 1 — Revenue from long-term investments – DividendsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ACP - - - 28,316 - -BERNHEIM-COMOFI - - - 64,061 64,061 60,394COBEPA 86,945 62,160 58,026 86,945 62,160 58,026COMPAGNIE GÉNÉRALE DES EAUX 92,820 97,330 93,908 92,820 97,330 93,908ÉDITIONS DUPUIS - - - 37,561 12,000 21,068ELF AQUITAINE 116,829 130,470 127,117 116,829 130,470 127,117ESPIRITO SANTO FINANCIAL HOLDING 5,622 32,260 42,076 5,622 32,260 42,076PARGESA - - - 787,383 790,283 771,914PETROFINA - - - 600,431 528,379 480,345ROYALE BELGE - - - 118,328 97,828 110,279SCI & ASSOCIÉS - - - - 149,768 -SOCIÉTÉ GÉNÉRALE DE BELGIQUE 194,972 195,945 193,377 194,972 195,945 193,377TRANSCOR - - - 69,149 23,978 114,423Others 13 15,249 15 7,165 15,249 8,705Total 497,201 533,414 514,519 2,209,582 2,199,711 2,081,632

Note 2 — Revenue from long-term investments – InterestsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995HÉLIO CHARLEROI 5,156 7,800 7,800 5,156 7,800 7,800SUZY 6,072 - - 6,072 - -SCI & ASSOCIÉS - 34,144 73,819 - 34,144 73,819Total 11,228 41,944 81,619 11,228 41,944 81,619

Note 3 — Operating income from equity-accounted companiesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ACP 72,699 52,969 33,202 - - -BERNHEIM-COMOFI 68,774 (37,528) 89,695 - - -ÉDITIONS DUPUIS 49,169 37,806 31,851 - - -HÉLIO CHARLEROI 41,772 20,298 12,376 - - -PARJOINTCO (1) 1,510,247 1,451,384 1,304,519 - - -PETROFINA 1,413,897 1,021,124 735,012 - - -ROYALE BELGE (2) 416,250 264,552 178,350 - - -SCI & ASSOCIÉS - 149,768 204,569 - - -SUZY 40,172 - - - - -TRANSCOR 103,163 82,600 21,624 - - -Others 2,363 3,032 1,527 - - -Total - in profit

- in loss3,718,506

-3,083,533

(37,528)2,614,877

(2,152)--

--

--

- globally 3,718,506 3,046,005 2,612,725

(1) including profits made by ROYALE BELGE on the BBL/ING exchange in 1997 for an amount of 209,569 (187,652 Group share) and on TRACTEBEL in 1996 for anamount of 82,054 (73,473 Group share)

(2) including profits made on the BBL/ING exchange in 1997 for an amount of 234,287 and on TRACTEBEL in 1996 for an amount of 98,700

Note 4 — Capital results from equity-accounted companiesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995PARJOINTCO 2,490,677 411,710 (219,483) - - -Others - - (45,845) - - -Total - in profit

- in loss2,490,677

-411,710

--

(265,328)--

--

--

- globally 2,490,677 411,710 (265,328)

72



Note 5 — Operations on long-term investments – Profits on disposalsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ELF AQUITAINE 399,007 - - 399,007 - -COBEPA 149,706 - - 149,706 - -ROYALE BELGE 112,431 85,334 - 135,751 91,647 -ESPIRITO SANTO FINANCIAL HOLDING 49,996 - - 49,996 - -SCI & ASSOCIÉS 48,992 755,793 - 48,892 1,050,758 -Others 23,505 7,924 8,489 16,186 - 8,489Total 783,637 849,051 8,489 799,538 1,142,405 8,489

Note 6 — Operations on long-term investments – Write-down and write-backConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ARTEMIS - (249,330) (43,639) - (249,330) (81,466)ESPIRITO SANTO FINANCIAL HOLDING 39,729 259,301 (308,687) 39,729 259,301 (308,687)COMPAGNIE FINANCIÈRE DE PARIBAS - 65,140 (194,077) - 65,140 (194,077)Others - - (10,000) - - (10,000)Total write-down

write-back-

39,729(249,330)324,441

(556,403)-

-39,729

(249,330)324,441

(594,230)-

Note 7 — Exceptional revenue and expensesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Provision for potential compensation to FIBELPARin case of exercise by ELF AQUITAINE of its putoption on NPM/CNP shares - 136,000 (136,000) - 136,000 (136,000)Exchange hedging on FRF debt - - (179,078) - - (179,078)Provision for removal costs - (20,000) - - (20,000) -Costs relating to the new premises - (56,576) - - (56,576) -Other expenses (33,168) (29,178) - (33,168) (29,178) -Other revenues 6 238 - 6 238 -Total revenue

expenses6

(33,168)136,238

(105,754)-

(315,452)6

(33,168)136,238

(105,754)-

(315,452)

Note 8 — Reconciliation of the consolidated profit and the restricted consolidated profit (Group share)

OPERATING CAPITAL TOTAL

Direct contribution

Restrictedconsoli-dated

Results ofequity

accountedcompanies Dividend

Consoli-dated


Results ofequity

accountedcompanies Others

Amorti-sation ofgoodwill

Consoli-dated

Consoli-dated

PARGESA 705,039 1,392,314 (705,039) 1,392,314 - 2,559,052 - (314,961) 2,244,091 3,636,405ACP 28,316 72,699 (28,316) 72,699 - - - (746) (746) 71,953BERNHEIM-COMOFI 64,061 68,774 (64,061) 68,774 - - - (4,115) (4,115) 64,659ÉDITIONS DUPUIS 37,561 49,169 (37,561) 49,169 - - - - - 49,169HÉLIO CHARLEROI 5,156 41,772 - 46,928 - - - - - 46,928PETROFINA 600,431 1,413,897 (600,431) 1,413,897 - - - (116,346) (116,346) 1,297,551ROYALE BELGE 118,328 416,250 (118,328) 416,250 - - - (23,857) (23,857) 392,393SUZY 6,072 40,172 - 46,244 - - - (10,756) (10,756) 35,488TRANSCOR 69,149 103,163 (69,149) 103,163 - - - - - 103,163Others 1,215,989 2,363 (7,153) 1,211,199 806,595 - (16,677) - 789,918 2,001,117Total 2,850,102 3,600,573 (1,630,038) 4,820,637 806,595 2,559,052 (16,677) (470,781) 2,878,189 7,698,826in BEF per share 112.47 190.24 31.83 113.58 303.82

73


APPENDIX

I. Principles, Group structure and methods of consolidation

In addition to the consolidated accounts required by the Royal Decrees of 6 March 1990 and 25 November 1991,the Company also publishes restricted consolidated accounts.

The latter fully consolidate the results of the parent company and those of fully owned financial companies (seelist at point II below), AGESCA NEDERLAND (89.54 % held) and its subsidiary N.F. ASSOCIATES, andproportionally consolidate CENTRE DE COORDINATION DE CHARLEROI, GROUPE JEAN DUPUIS andPARJOINTCO, which are jointly controlled.

These restricted consolidated accounts are published for information purposes only ; as they have no statutorynature, no further details are provided in this Appendix.

The consolidated accounts which are analysed in this appendix fully consolidate the accounts of the parentcompany and those of its subsidiaries in which there is a shareholding of 100 %, of AGESCA NEDERLAND andof N.F. ASSOCIATES, proportionally consolidate CENTRE DE COORDINATION DE CHARLEROI andGROUPE JEAN DUPUIS and consolidate by the equity method the accounts of companies in which there is ashareholding, directly or indirectly, of at least 20 %, as well as those of PARJOINTCO, which is jointly controlled.

This accounting treatment is intended to better reflect the true picture of the assets of the NPM/CNP Group, withPARJOINTCO fully consolidating PARGESA, GBL and PARFINANCE Groups.

In order to give shareholders a more complete picture of the Group, a summary presentation of the consolidatedaccounts of PARJOINTCO (i.e. including the PARGESA Group) is included (see pages 84 to 89).

74


APPENDIX

The Group structure at 31 December 1997 can be presented as follows :

(1) Agreement between the FRÈRE-BOURGEOIS and NPM/CNP Groups providing equal management control(2) Company jointly held with POWER CORPORATION OF CANADA(3) CLT-UFA HOLDING, 50 % jointly held, owns 98 % of CLT-UFA(4) Shares acquired at the end of the year have not contributed to the 1997 profit

ACP

SUZY

IJSBOERKE

ÉDITIONS DUPUIS

HÉLIO CHARLEROI

PETROFINA

TRANSCOR

ROYALE BELGE

BERNHEIM-COMOFI

NPM / CNPand consolidated financial holdings

PARJOINTCO (2)

AGESCA NEDERLAND N.F. ASSOCIATES

ERBE GROUP

FIBELPAR GROUP

GBLand consolidatedfinancial holdings

40.7 % PARFINANCE

48.9 % balance sheet48.2 % P&L (4)

PARGESAHOLDING 45.8 %

20.4 %

2.1 %

47.6 %

22.7 %

40.5 %

83.1 %

54.4 %

25.6 %

100.0 %

54.5 %Equity

62.1 %Votes

Restricted consolidation

Consolidation

89.5 %Equity

joint control(1)

10.5 %Equity

Jointcontrol (1)

49.0 %

50.0 %

38.0 %

IMÉTAL

ORIOR

COMETRA

MONUMENT OIL & GAS

CLT-UFA (3)

BELGIAN SKY SHOPS

DEWAAY

57.1 %

53.5 %

54.5 %

GROUPE JEAN DUPUIS

50.0 %

50.0 %

50.0 %

6.4 %

100.0 %

47.6 %

21.7 %

50.0 %

FRÈRE-BOURGEOIS GROUP

12.9 %

28.3 %

100.0 % B/S 0,0 %P&L (4)

100.0 %

75


APPENDIX

II. Fully consolidated subsidiaries Nationalidentification Percentage of shares held by

orVAT number

consolidatedsubsidiaries

equity-accountedcompanies

AGESCA NEDERLAND N.V. - Rotterdam - 89.5 -CARPAR S.A. - Loverval 441.649.215 100.0 -COMPAGNIE IMMOBILIÈRE DE ROUMONT S.A. - Loverval 455.738.167 100.0 -FINGEN S.A. - Luxembourg - 100.0 -INVESTOR S.A. - Loverval 426.114.070 100.0 -N.F. ASSOCIATES N.V. - Rotterdam - 100.0 (1) -ORILUX S.A. - Luxembourg - 100.0 -SLP S.A. - Loverval 429.364.758 100.0 -SWIFIN S.A. - Luxembourg - 100.0 -SWILUX S.A. - Luxembourg - 100.0 -

(1) 100 % of the ordinary equity is held by AGESCA NEDERLAND N.V.

III. Proportionally consolidated subsidiaries Nationalidentification Percentage of shares held by

orVAT number



CENTRE DE COORDINATION DE CHARLEROI S.A.Loverval

454.199.332 50.0 20.9

GROUPE JEAN DUPUIS S.A. - Loverval 405.630.244 50.0 50.0

IV. Major equity-accounted companies Nationalidentification Percentage of shares held by

orVAT number



ACIDE CARBONIQUE PUR S.A. - Brussels 402.117.062 28.3 -BERNHEIM-COMOFI S.A. - Brussels 403.231.968 21.7 60.9ÉDITIONS DUPUIS S.A. - Marcinelle 429.160.563 100.0 (1) -ELECTRAFINA S.A. - Brussels 407.040.209 - 48.4GROUPE BRUXELLES LAMBERT S.A. - Brussels 403.228.010 - 48.9HÉLIO CHARLEROI S.A. - Fleurus 434.915.138 50.0 (1) -IJSBOERKE ICE CREAM INTERNATIONAL N.V. - Tielen 438.625.684 100.0 -PARFINANCE S.A. - Paris - - 86.5PARGESA HOLDING S.A. - Geneva - - 54.5PARJOINTCO N.V. - Rotterdam - 50.0 -PETROFINA S.A. - Brussels 403.079.441 6.4 22.7ROYALE BELGE S.A. - Brussels 403.292.346 2.1 12.9 (2)ROYALE VENDÔME S.A. - Brussels 432.525.869 - 25.1SUZY N.V. - Buizingen 417.942.811 100.0 -TRANSCOR S.A. - Brussels 402.981.550 47.6 47.6

(1) investment held by GROUPE JEAN DUPUIS (2) 51.2 % held by ROYALE VENDÔME

V. Other companies in which there is a shareholdingof at least 10 %

Nationalidentification Percentage of shares held by

orVAT number



HEXANE S.A. - Brussels 451.175.506 50.0 (1) - (1) investment held by GROUPE JEAN DUPUIS, which is not equity-accounted due to its minor importance.

For the sake of the clarity and conciseness necessary to give a good overall view of the Group, the above lists are notexhaustive.

Subsidiaries controlled by companies included under point IV have been omitted, as they are considered as economicallybeing an integral part of these companies. Also excluded were the entities or Groups in which the companies includedunder point II do not have any direct shareholding or which are not part of a chain leading to a shareholding accounted forunder the equity method.

Complete details are available at the Company’s Registered Office and will be filed with the NATIONAL BANK OFBELGIUM together with the consolidated accounts.

76


APPENDIX

VI. Accounting policies

The accounting policies applied in the preparation of the consolidated accounts are the same as those which apply to thestatutory accounts (cf. point XX of the Appendix to the annual accounts). As allowed by the Royal Decree of 6 March 1990,financial statements of equity-accounted companies or groups have not been restated, except where the accountingpolicies applied in these accounts are incompatible with those laid down by Belgian law and European Directives.

� Intercompany balances are eliminated ; the Group’s share of intercompany profits earned from both subsidiaries andequity-accounted companies is eliminated.

� The assets and liabilities of foreign companies are translated using the closing rate method ; the income statements ofthese companies are converted at the average rate for the year as published by the NATIONAL BANK OF BELGIUM.

� Goodwill is the difference on consolidation calculated when a company is included in the consolidation for the first time.For those companies falling within the restricted consolidation, where positive goodwill arises, it is as far as possibleallocated to the individual assets which justified the payment of the premium. If no such allocation can be made it isfully written off in the year in which it arises.

Positive goodwill on equity-accounted companies is amortised at 5 % per annum. The Board of Directors believes thatamortising goodwill over 20 years corresponds more closely to economic reality (goodwill is paid in the expectation offuture profits) rather than the 5 year limit suggested by the Royal Decree. Minor amounts may be written off in full.Extraordinary amortisation is made when the Board considers that the goodwill is overstated.

Negative goodwill is reported as a component of the shareholders’ equity and remains there for as long as the shares towhich it relates stay within the Group.

VII. Statement of formation expenses (BEF thousand)

Opening net book value -Movements in the year- additional costs incurred -- amounts written off -

Closing net book value -

VIII. Statement of intangible assets (BEF thousand)



IX. Statement of tangible fixed assets (BEF thousand)

Lands andbuildings

Furniture andvehicles

Assets underconstruction

Other tangibleassets

a) Acquisition costOpening balance 20,541 45,615 182,622 -Movement in the year- acquisitions 27,905 84,718 31,024 -- disposals - (4,273) (213,646) 213,646Closing balance 48,446 126,060 - 213,646

c) DepreciationOpening balance - (28,292) - -Movement in the year- charged - (11,837) - (5,184)- written back - 3,318 - -Closing balance - (36,811) - (5,184)

Closing net book value 48,446 89,249 - 208,462

77


APPENDIX

X. Statement of investments (BEF thousand)

Companiesequity-accounted other

1. Shareholdingsa) Acquisition cost

Opening balance 33,201,723 12,113,038Movements in the year- acquisitions 1,526,119 -- disposals and withdrawals (220,202) (1,720,899)- transfer between items - -

Closing balance 34,507,640 10,392,139b) Revaluation surplus

Opening balance - -Movements in the year- revaluations - -- cancellations - -

Closing balance - -c) Amounts written-off

Opening balance - (364,896)Movements in the year- charged - -- written back - 39,729- transfer between items - 261,104

Closing balance - (64,063)

d) Increases or reductions resulting from consolidationunder the equity methodOpening balance (851,909) -Movements in the year- acquisitions (1,250,334) -- profits 6,209,183 -- dividends received (1,716,720) -- disposals 18,648 -- other 410,524 -

Closing balance 2,819,392 -e) Amounts not called

Opening balance - (880)Movements in the year - -

Closing balance - (880)

Closing net book value 37,327,032 10,327,196

2. Bonds and amounts receivableOpening net book value 75,000 6

Movements in the year- additions 200,000 3- repayments or disposals - -- amounts written off - -

Closing net book value 275,000 9Cumulative write-offs on receivables at the end of thefinancial year - -

78


APPENDIX

XI. Statement of reserves (BEF thousand)

Opening net book value 8,627,375Movements in the year- profit 7,698,826- dividends paid (2,635,360)- changes in accounting principles by PETROFINA (583,424)

Closing net book value 13,107,417

XII. Statement of goodwill (BEF thousand)

Subsidiaries Equity-accounted companiespositive negative positive negative

Opening net book value - 149,459 1,998,161 76,570Movements in the year- adjustments resulting from an increase

in shareholding percentage - - 1,277,176 -- adjustments resulting from a decrease

in shareholding percentage - - (118,134) -- amortisation - - (155,820) -- differences taken to results - - - -- others - - - (11,395)

Closing net book value - 149,459 3,001,383 65,175

XIII. Statement of liabilities (BEF thousand)

due within one year(current portion)

with more than oneyear but less thanfive years to run

with more thanfive years to run

A. Analysis of amounts originally payable aftermore than one yearFinancial liabilities - 3,273,750 -2. Non-subordinated debentures - 3,273,750 -

1997C. Taxes, salaries and social charges payable

1. Taxesb) not overdue tax payablec) accrued tax charges

2. Salaries and social chargesb) other salaries and social charges

80,12450,132

5,490

79


APPENDIX

XIV. Other information regarding operating results (BEF thousand)

1997 1996 1995B.1. Average number of employees

Additional Personnel (12.1 in 1997, 20.1 in 1996 and 20.7 in1995) is included in the records of the NPM/CNP CostAssociation ; it is then allocated among the members at theend of the year.

18.6 10.7 10.2

B.2. Payroll expenses 89,274 79,538 79,369a) salaries and direct social charges 64,466 58,442 58,270b) employers’ social insurance contributions 16,317 13,519 13,442c) employers’ additional insurance contributions 5,537 (1) 3,498 3,596d) other employment costs 2,954 4,079 4,061

D. Taxes on results1. Taxes on the profit for the year 45,677 59,219 24,697

a) taxes and withholdings paid or payable 282,332 262,909 261,551b) payment of taxes or withholdings included

in the balance sheet (282,332) (262,909) (261,551)c) estimated additional taxes 45,677 59,219 24,697

2. Taxes on the profits for previous years 3,606 - 5,094(1) in addition, an exceptional charge regarding pension expenses of 25,000 was booked in 1997

XV. Off-balance sheet rights and commitments

1. Within the framework of the 1990 agreement - renewed in 1996 - between the FRÈRE-BOURGEOIS/NPM-CNP andPOWER Groups with respect to the joint control of PARGESA HOLDING S.A., the partners acknowledged the followingmutual rights and commitments :

in the case of the loss of control by the FRÈRE-BOURGEOIS/NPM-CNP Group or by the POWER Group ofPARJOINTCO N.V. or, should that company be dissolved, of the companies to which ownership of the PARGESAshares will be transferred, subject to settlement by arbitration, the defaulting Group will grant an option to the otherGroup to acquire the shareholding in PARGESA held by PARJOINTCO N.V. or by companies of the defaulting Group, atthe stock market price at the time of the arbitration settlement for PARGESA shares and at the issue price for any otherPARGESA security.

2. As part of the agreement for the sale of SCI & ASSOCIÉS and its subsidiary CACAO BARRY, NPM/CNP had to grantthe acquirer the usual guarantees concerning the sale of enterprises (mainly a guarantee covering assets and liabilitiesvalid until 31 December 1997 or up to the statutory requirement in force on fiscal and social matters, including adeductible). In early January 1998, the Company received from the acquirer, in violation of the contractual terms (thisviolation has been confirmed by the advisors of the Company), notification of elements (for a sum well below thedeductible) which could give rise to a subsequent call on the guarantee in the event that other items (as yet unknown)were to follow suit, possibly crossing the threshold of the said deductible. As the Company did not know any elementlikely to trigger the guarantee at the time this document went to press, no provision was set aside to cover this potentialrisk.

3. In order to cover the exchange risk associated with its ELF AQUITAINE shares, in 1994 the NPM/CNP Group made aBEF/FRF interest rate swap for a period of five years for a sum of FRF 514 million. This operation provided the Groupwith the benefit, in addition to covering the exchange risk, of a favourable interest rate differential of 0.5% per annum forthe duration of the contract. Since the term of the contract extends beyond the date for setting the Euro exchange rates,the conversion difference (favourable or otherwise) appearing on this date on the loan portion of the swap will be carriedforward, on 31 December 1998, to the value of the shares covered by this operation. In order to cover the exchangerisk related to the ELF AQUITAINE shares, the NPM/CNP Group carried out a BEF/FRF exchange rate and interest rateswap for a period of 5 years covering some FRF 514 million.

Despite the sale of part of its holding in ELF AQUITAINE during 1997, the amount of this cover remained well below thevalue of the stock in our possession due to the significant rise in its value.

4. At 31 December 1997, 1,700,000 NPM/CNP warrants were still in circulation, giving the right to subscribe for the samenumber of shares in the company up to 1999 on the following conditions :

- 1,500,000 shares at a price of BEF 2,365 (warrants issued in 1994)- 200,000 shares reserved for the personnel at a price of BEF 1,696 (warrants issued in 1990)

80


APPENDIX

XVI. Intercompany balances with associated and related companies (BEF thousand)

Associated companies Related companies1997 1996 1995 1997 1996 1995

1. Investments- shares 25,185,779 21,142,561 18,239,675 10,451,150 9,613,198 15,064,303- receivables 275,000 75,000 75,000 - - 1,772,996

2. Receivables- due within one year 6,783,658 8,329,629 3,025,000 - - -

3. Short-term investments- shares 489,063 - - 297,600 - -- receivables - - - - - -

4. Payables- falling due beyond one year - - - - - -- long-term liabilities due within

one year - - - - - -- due within one year 4,562,500 6,200,265 3,062,105 - 303,353 93,413

7. Finance income/expense- Income

- from investments 11,228 7,800 - - 34,144 81,619- from current assets 236,060 272,074 121,812 18,962 - -- other financial income - - - - - -

- Expenses- on payables 124,257 154,435 156,989 120 - -- other financial costs - - - - - -

XVII. Financial relations with Directors (BEF thousand)

1997 1996 1995A. Amounts of remuneration paid during the year to

Members of the Board of Directors of the parentcompany by fully or proportionally consolidatedcompanies 24,503 24,279 19,985

B. Loans and advances granted to Directors - - -

81


STATEMENTS OF CASH FLOWS

(BEF thousand) Consolidated accounts Restricted consolidated accountsSOURCES OF LONG-TERM FUNDS 1997 1996 1995 1997 1996 1995Cash flow of the year 8,324,248 4,972,967 3,473,863 3,798,705 3,483,299 3,091,719

Net profit (Group) 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296(Minority interests) 404,739 170,661 88,318 61,599 54,945 51,933

Depreciation and net write-offs 224,183 (18,501) 776,640 83,909 (170,070) 694,240Provisions for liabilities and charges (3,500) (261,857) 245,250 (3,500) (227,750) 245,250

Other changes in equity 265,736 462,079 (267,780) (7,733) (3,479) 75,262Other changes in minority interests 32,793 260,554 (50,916) (4,534) 241,000 (52,963)Long-term debt - - - 15,636 (17,279) 236,561

8,622,777 5,695,600 3,155,167 3,802,074 3,703,541 3,350,579

APPLICATIONS OF LONG-TERM FUNDSDividends paid 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188Tangible assets 142,692 146,752 68,778 142,692 146,752 68,778Long-term investments (including goodwill) 5,074,119 (3,455,475) (277,075) 46,125 (5,415,296) (297,501)

7,852,171 (724,043) 2,343,891 2,824,177 (2,683,864) 2,323,465

Net increase/(decrease) in long-term funds 770,606 6,419,643 811,276 977,897 6,387,405 1,027,114

CHANGES IN WORKING CAPITAL

Increase/(decrease) in current assetsTrade receivables within one year 37,366 (22) 7,045 37,366 (22) 7,045Other amounts receivable within one year (1,850,025) 5,624,243 180,348 (1,909,162) 5,491,493 267,414Short-term investments - own shares (125,077) 872,095 - (125,077) 872,095 -Short-term investments - other investments and deposits 2,115,320 (15,368) (1,477,827) 2,327,951 139,035 (1,449,105)Cash at bank and in hand (936,735) 3,528,516 1,924,711 (920,345) 3,486,781 1,944,159Deferred charges and accrued income 196,233 (66,667) 40,246 199,881 (65,896) 40,001

(562,918) 9,942,797 674,523 (389,386) 9,923,486 809,514

Increase/(decrease) in current liabilitiesTransfers from long-term debt - - (20,000) - - (20,000)Financial liabilities (1,407,083) 3,424,258 (383,180) (1,408,756) 3,425,931 (468,265)Trade payables (8,980) 23,266 23,046 (8,980) 23,266 23,046Taxes, salaries and social charges payable 21,576 60,384 (19,121) 18,352 63,608 (20,782)Other amounts payable within one year (163,230) 89,783 331,031 (190,071) 89,788 331,026Accrued charges and deferred income 224,193 (74,537) (68,529) 222,172 (66,512) (62,625)

(1,333,524) 3,523,154 (136,753) (1,367,283) 3,536,081 (217,600)

Increase/(decrease) in working capital 770,606 6,419,643 811,276 977,897 6,387,405 1,027,114

82


STATEMENTS OF CASH FLOWS - COMMENTS

After a 1995 financial year with little movement in the portfolio, NPM/CNP disposed of the followingshareholdings in 1996 and 1997 :

- ROYALE BELGE53,425 shares in 1996 (for an amount of BEF 339 million) and 47,575 shares in 1997 (BEF 356 million).

- ESPIRITO SANTO FINANCIAL HOLDING1,783,695 shares in 1997 (for an amount of BEF 1,128 million) and 263,474 shares in 1997(BEF 199 million).

- COBEPA 288,174 shares in 1997 for an amount of BEF 431 million.

- ELF AQUITAINE296,695 shares in 1997 for an amount of BEF 1,132 million.

- SCI & ASSOCIÉSThe whole shareholding mid-1996 for an amount of BEF 5,056 million.

Shareholdings meant to be sold have been classified as short-term investments : PARIBAS end 1996(BEF 244 million) and ARTEMIS end 1997 (BEF 205 million).

In 1997, NPM/CNP acquired 100 % of SUZY (BEF 77 million for the shares and BEF 200 million forlong-term advances) and of IJSBOERKE (BEF 1,449 million).

83


AUDITORS’ REPORT

Ladies, Gentlemen,

In accordance with the legal and statutory requirements, we report on our audit assignmentwhich you have entrusted to us.

We have examined the consolidated annual accounts for the year ended 31 December1997, which have been prepared under the responsibility of the Board of Directors andwhich show a balance sheet total of BEF 74,285,102 (000) and an income statementresulting in a profit, for the year of BEF 7,698,826 (000) (Group share). In addition, wehave performed specific procedures with respect to the Directors’ report.

Unqualified audit opinion on the financial statementsOur examination has been conducted in accordance with the auditing standards of theINSTITUT DES REVISEURS D’ENTREPRISE / INSTITUUT DER BEDRIJFSREVISOREN.Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the consolidated annual accounts are free of materialmisstatement and are in compliance with the Belgian legal and regulatory requirements.

In accordance with these standards we have taken into account the administrative andaccounting organisation of the Company as well as the procedures of internal control. Theresponsible officers of the company have clearly replied to all our requests for informationand explanations. We have examined, on a test basis, the evidence supporting theamounts included in the consolidated financial statements. We have assessed theaccounting policies used, the significant estimates made by the Company and the overallpresentation of the consolidated annual accounts. We believe that our audit provides areasonable basis for our opinion.

In our opinion, the consolidated annual accounts present fairly the financial position ofNPM/CNP as of 31 December 1997, and the results of its operations for the year thenended taking into account the legal and regulatory requirements, and the supplementaryinformation given in the notes is adequate.

Additional certificationsWe supplement our report with the following certifications which do not impact on our auditopinion on the financial statements :

- The Directors’ report includes the information required by the law and is in accordancewith the consolidated financial statements.

Brussels, 3 April 1998

The Statutory Auditors

KLYNVELD PEAT MARWICK GOERDELERReviseurs d’Entreprises S.C.C.

represented byGeorges M. TlMMERMAN

DELOITTE & TOUCHEReviseurs d’Entreprises S.C.C.

represented byClaude POURBAIX

84


PARJOINTCO - SUMMARY CONSOLIDATED ACCOUNTS

Introduction

PARJOINTCO N.V., a company registered under Dutch law, was set up in 1990, on the basis of equality of shareholding andmanagement control between the FRÈRE-BOURGEOIS/NPM-CNP Group on the one hand and POWER CORPORATION OFCANADA on the other. It is the financial vehicle for joint control of the PARGESA/GBL/PARFINANCE groups, consolidatingapproximately 54.5 % of the capital of PARGESA which, in turn, controls GBL. These two latter companies together controlPARFINANCE (86.5 % of the capital).

Principles of consolidation

The audited accounts of the companies listed above were included as transmitted by their auditors, the only exceptions being thecorrecting entries necessary to bring them in line with the Belgian accounting principals and those allowing the change fromconsolidation under the equity method to full consolidation of GBL and PARFINANCE by PARGESA ; the accounts presented herealso consolidate ELECTRAFINA and AUDIOFINA, which are included in GBL’s accounts.

As already stated, positive goodwill relating to the various companies is not allocated but is shown as part of the cost of thecompanies on which it has arisen and amortised at a rate of 5 % per annum. However, following the sale by ELECTRAFINA of itsshares in TRACTEBEL in the second half of 1996, PARGESA considered it appropriate to record an exceptional amortisationcharge of BEF 431 million against its goodwill in GBL (BEF 237 million relating to the part belonging to PARJOINTCO).PARJOINTCO itself charged exceptional amortisation of BEF 680 million, calculated as the difference, at the time of its creation in1990, between the stock market value of the TRACTEBEL shares and their consolidated book value within thePARGESA/GBL/PARFINANCE Group.Similarly, in 1997, because of the capital gains made by the PARGESA Group on its shareholdings in BBL and in CLT,PARJOINTCO booked an exceptional goodwill amortisation of BEF 621 million.

Highlights of the 1997 financial year

During the 1996 financial year, the equity of PARJOINTCO changed as follows (BEF million) :

- equity at 31.12.1996 38,530- profit for the year 8,002- distributed dividend (1,585)- translation adjustments 1,015- changes in accounting principles by PETROFINA (211)- equity at 31.12.1997 45,751

PARJOINTCO, as such, did not conduct significant financial operations during the 1995 financial year. Operations conducted byPARJOINTCO’s subsidiaries (PARGESA, GBL, PARFINANCE, ELECTRAFINA and AUDIOFINA) are described in themanagement report section. The most significant accounting impacts come from the capital gains booked on the shareholding inCLT (upon grouping of the CLT activities with those of UFA) and on BBL shares as a consequence of the Public Offer by ING.

85


PARJOINTCO - SIMPLIFIED CHART

Consolidation structure at 31 December 1997

GROUPE BRUXELLES LAMBERTPARFINANCE

ROYALE VENDÔME

MONUMENT OIL & GAS

CLT-UFA

PETROFINA

COMETRAORIOR HOLDING

IMÉTAL

54.5 % Equity62.1 % Votes

PARJOINTCO

PARGESA HOLDING

45.8 %48.9 % Balance sheet48.2 % P&L (1)

25.1 %

51.2 %

83.1 %

22.7 %

25.6 %

100 %

40.7 %

ELECTRAFINA

AUDIOFINA

BERNHEIM-COMOFI

TRANSCOR

DUPUIS

DISTRIPAR / BSS

DEWAAY

40.5 %

47.6 %

49.0 %

50.0 %

38.0 %

FULLYCONSOLIDATED

PROPORTIONALLYCONSOLIDATED

CONSOLIDATION UNDERTHE EQUITY METHOD

20.4 %

54.4 %

48.4 % Balance sheet48.0 % P&L (1)


CLT-UFA HOLDING

50 %

98 %

ROYALE BELGE

(1) shares acquired at the end of the year did not contribute to the 1997 profit


86


PARJOINTCO - BALANCE SHEETS

ASSETS Group share Minority interests Total(BEF million) 1997 1996 1995 1997 1996 1995 1997 1996 1995

Goodwill 3,803 3,862 5,532 10,501 24,971 13,580 14,304 28,833 19,112

Equity-accounted companies 19,974 21,411 19,622 72,670 87,446 97,510 92,644 108,857 117,132

Other fixed assets and investments 13,773 11,775 11,967 59,530 35,858 40,315 73,303 47,633 52,282

37,550 37,048 37,121 142,701 148,275 151,405 180,251 185,323 188,526

Current assets 17,315 8,830 9,963 56,482 31,704 22,012 73,797 40,534 31,975

Total 54,865 45,878 47,084 199,183 179,979 173,417 254,048 225,857 220,501

LIABILITIES AND EQUITY Group share Minority interests Total(BEF million) 1997 1996 1995 1997 1996 1995 1997 1996 1995

Equity (Group) 45,751 38,530 36,165 - - - 45,751 38,530 36,165

Minority interests - - - 186,078 162,843 148,337 186,078 162,843 148,337

Provisions for liabilities and charges 1,003 1,018 824 1,519 1,389 1,065 2,522 2,407 1,889

Long-term debt 2,936 4,405 6,336 10,275 11,959 13,977 13,211 16,364 20,313

Current liabilities 5,175 1,925 3,759 1,311 3,788 10,038 6,486 5,713 13,797

Total 54,865 45,878 47,084 199,183 179,979 173,417 254,058 225,857 220,501

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PARJOINTCO - PROFIT AND LOSS STATEMENTS

RESULTS Group share Minority interests Total(BEF million) 1997 1996 1995 1997 1996 1995 1997 1996 1995

Dividends and interests 444 325 445 1,768 796 1,293 2,212 1,121 1,738

Results of equity-accountedcompanies 2,575 2,414 2,031 8,060 11,652 10,994 10,635 14,066 13,025

Income from investments 3,019 2,739 2,476 9,828 12,448 12,287 12,847 15,187 14,763

Gains on disposal of current assets 202 79 76 346 104 224 548 183 300

Other financial revenue 1,164 885 800 4,032 2,397 1,750 5,196 3,282 2,550

Interest expenses (378) (360) (537) (888) (894) (1,170) (1,266) (1,254) (1,707)

Losses, amounts written off andwritten back on current assets (48) - (70) (109) - (261) (157) - (331)

Other financial expenses (651) (220) (122) (1,987) (673) (341) (2,638) (893) (463)

Other expenses and operating revenue (250) (297) (211) (473) (481) (467) (723) (778) (678)

Operating income before taxes 3,058 2,826 2,412 10,749 12,901 12,022 13,807 15,727 14,434

Gains on disposal of investments 6,281 2,832 315 22,863 17,515 959 29,144 20,347 1,274

Losses, amounts written off andwritten back on investments (132) (246) (111) (474) (580) (337) (606) (826) (448)

Amortisation of goodwill (1,169) (1,410) (441) (1,100) (1,659) (1,034) (2,269) (3,069) (1,475)

Other extraordinary revenue/(expenses) 1 (269) (2) (30) (722) 21 (29) (991) 19

Capital result before taxes 4,981 907 (239) 21,259 14,554 (391) 26,240 15,461 (630)

Taxes (37) (7) (3) (196) (18) (115) (233) (25) (118)

Net profit 8,002 3,726 2,170 31,812 27,437 11,516 39,814 31,163 13,686

88


PARJOINTCO - ANALYSIS OF THE MAJOR ITEMS

GOODWILL

(BEF million) Group share Minority interests Total

1997 1996 1995 1997 1996 1995 1997 1996 1995PARGESA 710 1,330 2,093 - - - 710 1,330 2,093PETROFINA 1,012 1,091 1,124 6,826 7,627 8,278 7,838 8,718 9,402ROYALE BELGE 498 536 599 1,370 1,518 1,675 1,868 2,054 2,274GBL 1,034 417 804 863 342 644 1,897 759 1,448IMÉTAL 442 331 474 791 588 1,513 1,233 919 1,987Others 107 157 438 651 14,896 1,470 758 15,053 1,908Total 3,803 3,862 5,532 10,501 24,971 13,580 14,304 28,833 19,112

INVESTMENTS IN EQUITY-ACCOUNTED COMPANIES

(BEF million) % held Group share Minority interests Total

1997 1996 1995 1997 1996 1995 1997 1996 1995 1997 1996 1995IMÉTAL 54.4 52.5 52.7 8,238 7,098 4,028 14,755 12,601 12,839 22,993 19,699 16,867PETROFINA 22.7 22.8 22.8 4,455 4,069 3,563 30,874 28,454 26,254 35,329 32,523 29,817BBL - 12.4 12.4 - 2,987 2,751 - 8,459 7,695 - 11,446 10,446TRACTEBEL - - 20.5 - - 2,594 - - 19,118 - - 21,712ROYALE BELGE 12.9 12.9 13.0 2,879 2,292 2,054 7,916 6,489 5,743 10,795 8,781 7,797ORIOR HOLDING 83.1 74.1 69.0 1,980 1,721 1,749 1,651 1,406 1,400 3,631 3,127 3,149COMETRA 100.0 100.0 100.0 655 611 488 4,414 4,270 3,595 5,069 4,881 4,083CLT-UFA (1) 50.0 97.1 96.8 634 1,342 1,081 8,788 21,145 16,249 9,422 22,487 17,330BERNHEIM-COMOFI 40.5 40.5 40.5 385 373 426 1,060 1,058 1,192 1,445 1,431 1,618MONUMENT / NIMEX 25.6 25.7 66.7 319 228 215 2,147 1,595 1,587 2,466 1,823 1,802Others 429 690 673 1,065 1,969 1,838 1,494 2,659 2,511Total 19,974 21,411 19,622 72,670 87,446 97,510 92,644 108,857 117,132

(1) CLT-UFA HOLDING, 50 % jointly held, owns 98 % of CLT-UFA

PROFITS OF EQUITY-ACCOUNTED COMPANIES

(BEF million) Profit (100 %) Group share Minority interests Total

1997 1996 1995 1997 1996 1995 1997 1996 1995 1997 1996 1995IMÉTAL (FRF) 620 614 596 724 692 443 1,306 1,229 1,412 2,030 1,921 1,855ROYALE BELGE 23,159 11,315 6,176 722 418 234 2,028 1,183 655 2,750 1,601 889PETROFINA 22,060 16,048 11,608 630 450 310 4,367 3,158 2,287 4,997 3,608 2,597BBL 11,778 10,291 8,941 384 333 292 1,078 943 817 1,462 1,276 1,109BERNHEIM-COMOFI 317 (160) 426 35 (18) 43 98 (50) 122 133 (68) 165ORIOR HOLD. (CHF) 1.6 6.8 12.4 12 68 118 10 55 94 22 123 212CLT-UFA (2,882) 3,372 3,335 (87) 194 200 (1,336) 3,049 3,008 (1,423) 3,243 3,208TRACTEBEL (1) - 7,510 11,335 - 196 283 - 1,374 2,083 - 1,570 2,366Others 155 352 75 509 1,127 275 664 1,479 350Total 2,575 2,739 2,031 8,060 12,448 10,994 10,635 15,187 13,025

(1) In 1996, this shareholding contributed to the profit only for the first six months

89



GAINS ON DISPOSAL OF INVESTMENTS


1997 1996 1995 1997 1996 1995 1997 1996 1995BBL 3,639 - - 10,212 - - 13,851 - -CLT 1,259 - - 3,533 - - 4,792 - -Oil assets 829 - - 5,747 - - 6,576 - -GIB GROUP 211 - - 593 - - 804 - -TRACTEBEL - 2,341 - - 16,434 - - 18,775 -CARNAUDMETALBOX - 370 - - 658 - - 1,028 -Others 343 121 315 2,778 423 959 3,121 544 1,274Total 6,281 2,832 315 22,863 17,515 959 29,144 20,347 1,274

LOSSES ON DISPOSAL OF INVESTMENTS (-), AMOUNTS WRITTEN OFF (-) AND WRITTEN BACK (+)


1997 1996 1995 1997 1996 1995 1997 1996 1995PARIBAS 131 (181) (53) 236 (490) (170) 367 (671) (223)Others (263) (65) (58) (710) (90) (167) (973) (155) (225)Total (132) (246) (111) (474) (580) (337) (606) (826) (448)

AMORTISATION OF GOODWILL


1997 1996 1995 1997 1996 1995 1997 1996 1995PARGESA by PARJOINTCO (735) (840) (156) - - - (735) (840) (156)GBL by PARGESA (183) (330) (94) (152) (269) (76) (335) (599) (170)PETROFINA (85) (86) (82) (592) (601) (605) (677) (687) (687)IMÉTAL (71) (42) (41) (128) (74) (132) (199) (116) (173)ROYALE BELGE (50) (50) (52) (140) (140) (145) (190) (190) (197)AUDIOFINA / CLT - (54) - - (529) - - (583) -Others (45) (8) (16) (88) (46) (76) (133) (54) (92)Total (1,169) (1,410) (441) (1,100) (1,659) (1,034) (2,269) (3,069) (1,475)

90


SUMMARIZED FINANCIAL STATEMENTS OF MAJOR NON-LISTED SHAREHOLDINGS

The financial statements of the major non-listed shareholdings (other than PARJOINTCO) equity-accounted by NPM/CNP arepresented hereafter in a summarized version :

ACIDE CARBONIQUE PUR (BEF million)

1997 1996 1995 1994 1993Intangible assets - - - 5 9Tangible assets 1,799 1,763 1,926 2,149 1,995Investments 1 43 11 31 434Inventories 56 58 56 56 51Receivables 413 720 663 720 239Other current assets 2,236 1,348 1,359 2,121 1,749Assets 4,505 3,932 4,015 5,082 4,477Equity (before dividends) 1,605 1,444 1,243 2,601 2,542Minority interests 1 1 1 1 1Provisions for liabilities and charges 155 163 187 186 222Long-term debt 1,320 740 952 1,198 1,134Non financial short-term debt 737 1,086 528 859 360Other short-term liabilities 687 498 1,104 237 218Liabilities and equity 4,505 3,932 4,015 5,082 4,477

Turnover 1,102 1,081 1,072 1,084 1,178Cash flow before tax 496 457 434 330 1,462Total profit before tax 282 213 153 110 1,231Net income 271 201 132 74 1,089Dividend 100 100 1,482 - -

ÉDITIONS DUPUIS (BEF million)

1997 1996 1995 1994 1993Intangible assets 312 238 310 299 349Tangible assets 188 203 214 232 126Investments 29 14 46 11 2Inventories 329 378 288 294 358Receivables 620 735 460 386 516Other current assets 398 265 292 408 546Assets 1,876 1,833 1,610 1,630 1,897Equity (before dividends) 783 762 692 686 1,022Minority interests - - - - -Provisions for liabilities and charges - - 23 25 30Long-term debt 47 58 66 77 88Non financial short-term debt 1,046 1,013 729 692 757Other short-term liabilities - - 100 150 -Liabilities and equity 1,876 1,833 1,610 1,630 1,897

Turnover 2,176 1,799 1,675 1,637 1,454Cash flow before tax 361 248 232 172 108Total profit before tax 157 117 84 103 87Net income 98 77 62 86 59Dividend 85 75 36 30 28

91



IJSBOERKE (1) (BEF million)

1997 1996 1995 1994 1993Intangible assets 8 9 10 12 1Tangible assets 585 740 816 883 955Investments 21 22 22 25 26Inventories 166 215 245 194 181Receivables 139 137 146 148 133Other current assets 61 50 55 62 72Assets 980 1,173 1,294 1,324 1,368Equity (before dividends) 210 209 188 223 151Minority interests - - - - -Provisions for liabilities and charges 84 137 162 163 166Long-term debt 308 357 468 517 659Non financial short-term debt 202 261 341 295 280Other short-term liabilities 176 209 135 126 112Liabilities and equity 980 1,173 1,294 1,324 1,368

Turnover 1,819 1,795 2,017 1,978 1,850Cash flow before tax 121 161 198 251 175Total profit before tax 6 28 55 112 38Net income 2 23 36 71 13Dividend - - - - -

(1) Group accounts including IJSBOERKE, STARCO TIELEN, IMMO TIELEN and BELHOLDING.

SUZY (BEF million)

1997 (1)

Intangible assets -Tangible assets 311Investments -Inventories 143Receivables 322Other current assets -Assets 776Equity (before dividends) 77Minority interests -Provisions for liabilities and charges 9Long-term debt 200Non financial short-term debt 311Other short-term liabilities 179Liabilities and equity 776

Turnover 1,572Cash flow before tax 74Total profit before tax 28Net income 26Dividend -

The SUZY Group underwent majorrestructuring before its takeover byNPM/CNP ; the consolidated accountsof previous years are consequentlyimpossible to compare ; moreover theaccounting principles were notconsistent with those applied byNPM/CNP.

(1) accounts closed per 30 September.

92



HÉLIO CHARLEROI (BEF million)

1997 1996 1995 1994 1993Intangible assets - - - - -Tangible assets 649 856 1,083 1,259 937Investments 3 3 3 2 4Inventories 72 64 184 62 40Receivables 534 547 663 352 289Other current assets 122 135 181 95 98Assets 1,380 1,605 2,114 1,770 1,368Equity (before dividends) 448 329 230 192 183Minority interests - - - - -Provisions for liabilities and charges 118 65 30 5 5Long-term debt 434 597 804 939 553Non financial short-term debt 380 416 784 400 550Other short-term liabilities - 198 266 234 77Liabilities and equity 1,380 1,605 2,114 1,770 1,368


TRANSCOR (BEF million)

1997 1996 1995 1994 1993Intangible assets - - - - -Tangible assets 60 47 60 78 74Investments 25 82 20 37 59Inventories 1,225 2,272 1,179 1,599 2,002Receivables 2,275 2,306 2,145 3,158 4,396Other current assets 1,486 844 968 1,728 1,398Assets 5,071 5,551 4,372 6,600 7,929Equity (before dividends) 1,634 1,431 1,253 1,511 1,600Minority interests - - - 9 15Provisions for liabilities and charges 36 36 37 35 38Long-term debt - - - - -Non financial short-term debt 3,092 3,662 2,884 3,689 3,384Other short-term liabilities 309 422 198 1,356 2,892Liabilities and equity 5,071 5,551 4,372 6,600 7,929


93

NON-CONSOLIDATED ACCOUNTS

Balance sheets................................................................................................................. 94


Extract from the notes to the non-consolidated accounts at 31 December 1997 ............ 98

NOTICEIn accordance with article 80bis of the Co-ordinated Laws on Commercial

Companies, the statutory accounts presented in this chapter are anabridged version of the Parent Company accounts, and they include neitherall the notes and information required by law nor the report of the Statutory

Auditors, who have provided an unqualified opinion. The complete accountswill be deposited at the NATIONAL BANK OF BELGIUM and will also be

available at the Company’s head office.

94


BALANCE SHEETS

ASSETS (BEF thousand) 1997 1996 1995

FIXED ASSETS 52,973,161 48,326,675 48,281,150III. Tangible fixed assets 96,749 1,718 4,547

A. Lands and buildings 4,078 - -C. Furniture and vehicles 3,583 1,718 4,547E. Assets under construction and advance

payments 89,088 - -IV. Investments 52,876,412 48,324,957 48,276,603

A. Subsidiaries1. Shareholdings 28,431,269 25,060,164 22,973,042

B. Related companies1. Shareholdings 15,342,469 15,342,469 18,995,7852. Receivables - - 1,772,996

C. Other investments1. Stocks and shares 9,102,674 7,922,324 4,534,780

CURRENT ASSETS 16,115,778 16,401,285 19,146,808VII. Amounts receivables within one year 6,305,355 7,841,266 12,565,431

B. Other receivables 6,305,355 7,841,266 12,565,431VIII. Short-term investments 6,503,957 5,356,005 4,118,532

A. Own shares - 28,396 -B. Other investments 6,503,957 5,327,609 4,118,532

IX. Cash at bank and in hand 3,207,265 3,080,752 2,250,780X. Deferred expenses and accrued income 99,201 123,262 212,065

TOTAL ASSETS 69,088,939 64,727,960 67,427,958

95


BALANCE SHEETS

LIABILITIES AND EQUITY (BEF thousand) 1997 1996 1995

EQUITY 55,427,857 53,741,840 51,416,304I. Capital 4,751,250 4,751,250 4,751,250

A. Issued capital 4,751,250 4,751,250 4,751,250II. Share premium account 42,824,428 42,824,428 42,824,428IV. Reserves 1,591,909 1,129,203 766,408

A. Legal reserve 475,125 475,125 475,125B. Non-distributable reserves

1. Own shares 825,501 362,795 -2. Others 215 215 215

C. Tax-free reserves 221,068 221,068 221,068D. Distributable reserves 70,000 70,000 70,000

V. Profit carried forward 6,260,270 5,036,959 3,074,218

PROVISIONS AND DEFERRED TAXATION 4,000 23,500 142,410VII. A. Provisions for liabilities and charges 4,000 23,500 142,410

4. Other liabilities and charges 4,000 23,500 142,410

LIABILITIES 13,657,082 10,962,620 15,869,244VIII. Amounts payable after more than one year 3,273,750 3,273,750 3,273,750

A. Financial liabilities2. Non-subordinated debentures 3,273,750 3,273,750 3,273,750

IX. Amounts payable within one year 10,065,945 7,190,344 12,320,565B. Financial debts

1. Amounts due to financial institutions 1,220,973 1,019,941 995,6122. Other loans 6,050,000 3,500,000

C. Trade payables1. Suppliers 19,636 2,065 1,098

E. Taxes, salaries and social charges payable1. Taxes 80,845 77,064 48,1862. Salaries and social charges - 176 176

F. Other liabilities 2,694,491 2,591,098 11,275,493X. Accrued expenses and deferred income 317,387 498,526 274,929

LIABILITIES AND EQUITY 69,088,939 64,727,960 67,427,958

96



EXPENSES (BEF thousand) 1997 1996 1995A. Interest expense 357,400 395,844 487,591B. Other financial expense 85,913 143,179 82,611C. Miscellaneous goods and services 68,083 311,465 48,293D. Payroll expenses 27,181 34,532 38,432E. Miscellaneous operating expenses 19,232 140 184F. Depreciation and write-off of formation expenses,

tangible and intangible assets 3,913 2,560 3,351G. Write-off on 114,520 234 1,021,627

1. investments - - 941,1742. current assets 114,520 234 80,453

H. Provisions for liabilities and charges 4,000 3,500 6,410I. Losses on disposal of 4,614 650 179,773

1. tangible and intangible fixed assets 88 - 2932. investments 90 16 168,5303. current assets 4,436 634 10,950

J. Exceptional expenses - 25,987 136,000L. Taxes 37,216 55,716 29,020M. Profit for the year 4,321,377 4,910,216 2,393,518

TOTAL EXPENSES 5,043,449 5,884,023 4,426,810

O. Profit for the year available for appropriation 4,321,377 4,910,216 3,673,341

PROFIT APPROPRIATION (BEF thousand) 1997 1996 1995C. Transfer to reserves 462,706 362,795 -

2. to the legal reserve - - -3. to other reserves 462,706 362,795 -

D. Profit carried forward 6,260,270 5,036,959 3,074,2181. Profit carried forward 6,260,270 5,036,959 3,074,218

F. Profit to be distributed 2,635,360 2,584,680 2,552,1881. Dividends to shareholders 2,635,360 2,584,680 2,552,188

9,358,336 7,984,434 5,626,406

97



REVENUE (BEF thousand) 1997 1996 1995A. Revenue from investments 1,308,283 2,732,037 2,237,842

1. Dividends 1,308,283 2,697,893 2,163,9362. Interests - 34,144 73,906

B. Revenue from current assets 660,041 722,403 890,163C. Other financial revenue 252,573 93,528 66,387E. Other operating revenue 38,486 34,050 31,566G. Write-back on 847,452 64,670 84,316

1. investments 843,909 10,091 -2. current assets 3,543 54,579 84,316

H. Reversals of provisions for liabilities and charges 23,500 142,410 2,500I. Profits on disposal of 1,910,616 2,089,104 1,102,255

1. tangible and intangible fixed assets 574 108 -2. investments 1,302,824 1,901,008 706,7623. current assets 607,218 187,988 395,493

J. Extraordinary revenue 6 60 -L. Adjustment of income taxes and write-back of tax

provisions 2,492 5,761 11,781

TOTAL REVENUE 5,043,449 5,884,023 4,426,810

N. Transfer from tax-free reserves - - 1,279,823

PROFIT APPROPRIATION (BEF thousand) 1997 1996 1995A. Profit available for appropriation 9,358,336 7,984,434 5,626,406

1. Profit for the year available for appropriation 4,321,377 4,910,216 3,673,3412. Profit brought forward from the previous year 5,036,959 3,074,218 1,953,065

9,358,336 7,984,434 5,626,406

98


EXTRACT FROM THE NOTES

VIII. Statement of capital

A. Share capital In BEF thousand Number of shares1. Issued capital

- opening balance 4,751,250 25,340,000- changes during the year - -- closing balance 4,751,250 25,340,000

2. Description of capital2.1. Types of shares

- ordinary 4,651,281 24,806,830- AFV 1 9,075 48,400- AFV 2 144 770- AFV 3 45,375 242,000- AFV 4 45,375 242,000

2.2. Registered or bearer shares- registered 17,932,201- bearer 7,407,799

D. Commitments to issue shares2. Subscription rights

- number of subscription rights in issue- until 1999, at BEF 1,696 per share 200,000- until 1999, at BEF 2,365 per share 1,500,000

- capital to be subscribed 318,750- maximum number of shares to be issued 1,700,000

E. Capital authorised but not issued 2,000,000

G. Shareholding structure (law of 2 March 1989)At 31 December 1997, based on declarations received by that date :

Percentages

ShareholdersNumber

of shares heldNumber

of warrantsnon

dilutedfully

dilutedDate of

declarationINVESTOR 91,202 1,500 0.36 0.35 30.06.97CARPAR 286,917 - 1.13 1.06 30.06.97NPM/CNP - 299 - - 30.06.97Sub-Group NPM/CNP 378,119 1,799 1.49 1.41 30.06.97FIBELPAR 11,393,967 - 44.97 42.14 30.06.97PAM N.V. 2,210,070 - 8.72 8.17 30.06.97ERBE FINANCE - 103,750 - 0.38 30.06.97BELGIAN SKY SHOPS 670,930 (1) - 2.65 2.48 30.06.97IMMOBILIÈRE BERNHEIM-OUTREMER 71,001 (1) - 0.28 0.26 30.06.97FIBELPAR Group and associated companies 14,724,087 105,549 58.11 54.84 30.06.97

UAP VIE 1,261,066 - 4.98 4.66 21.03.94ROYALE BELGE 1,149,382 - 4.54 4.25 21.03.94URBAINE UAP (2) 266,666 - 1.05 0.99 21.03.94LLOYD BELGE (2) 69,595 - 0.27 0.26 21.03.94L’ASSURANCE LIEGEOISE (2) 42,000 - 0.17 0.16 21.03.94FOYER BELGE (2) 10,666 - 0.04 0.04 21.03.94UAP (now AXA-UAP) and ROYALE BELGE Groups 2,799,375 - 11.05 10.35 21.03.94

(1) early April 1998, BELGIAN SKY SHOPS owned 87,449 NPM/CNP shares, representing 0.35 % and 0.32 % of the non diluted and fully diluted capital of theCompany and IMMOBILIÈRE BERNHEIM-OUTREMER did not hold any share any longer

(2) the shares held by those companies were subsequently bought by ROYALE BELGE 1994

99



XX. Accounting policies

1. Formation expenses

Formation expenses are written off by at least 20 % per annum. The issue costs of borrowed capital, discounts andpremiums on loans are written off over the loan period.

In any event, the Board of Directors can decide to write off the formation expenses in the year in which they wereincurred.

2. Tangible fixed assets

Tangible fixed assets are recorded at cost or at the contributed value.

The straight line depreciation method is used and the following annual rates are applied :

- real estate rights 2 % (duration of the rights)- vehicles 25 %- furniture and office equipment 20 %- computer equipment 33 %- telephone facilities 33 %

3. Investments

a) Shareholdings and other securitiesShareholdings and other securities are recorded at cost, taking account of any adjustments to the value which maybe necessary, excluding incidental costs which are written off in the year in which they are incurred.

ShareholdingsShareholdings value is estimated at the end of each financial year, based primarily on a prudent assessment of theunderlying net assets, taking into account latent gains and losses which are considered to be of a permanent naturein view of the circumstances, profitability and known prospects of the Company.

The value of shareholdings is reduced to the extent that there has been a permanent impairment in value.

However, as provided for in article 34 of the Royal Decree of 8 October 1976, the Board may decide to takepermanent increases in the value of investments directly to section III of the balance sheet without passing throughthe income statement.

Other securitiesShares quoted on the stock exchange or in public sale are valued at the market price, if significant.Unquoted shares, and shares in which there is not considered to be significant trading, are valued in the same wayas shareholdings.The carrying value is reduced where there has been a permanent impairment in value.

b) Other investmentsThese are recorded at their cost or nominal value. The carrying value is reduced where there has been a permanentimpairment in value.

c) Receivables and guaranteesReceivables, including fixed interest bonds, included in investments, are written down where repayment at maturity,in whole or in part, is uncertain or otherwise compromised.

4. Amounts receivable after more than one year

These are valued in the same way as receivables included in other investments.

5. Amounts receivable within one year

These are valued in the same way as receivables included in other investments but without considering the permanentnature of impairments in value.

100



6. Short-term investments

These are recorded at cost excluding incidental expenses which are charged to the income statement.

In general, shares quoted on the stock exchange or in public sale are valued in the same way as other securitiesincluded in investments. However, write-downs are recorded, whether or not they are considered to be permanent.

7. Provisions for liabilities and charges

At the end of each financial year, the Board of Directors examines previous provisions and considers new provisionsrequired to cover possible liabilities or charges.

8. Commitments and recourse against third parties

The Board of Directors values commitments and recourse against third parties at the nominal value of the legalcommitment referred to in the contract ; if there is no nominal value or in borderline cases, they will be noted for therecord only.

9. Assets and liabilities recorded in foreign currencies

These are translated at the buying rate on the last day of the financial year.

10. Cost Association (1)

The Company is a member of a cost association (Association de frais), set up as an autonomous grouping with no legalpersonality, by a number of related companies, with the aim of rationalising and reducing their administrative costs bycombining their staff, offices, property, equipment and, in general, all the expenses incurred in managing theiroperations.

The allocation of expenses and costs incurred by the association is carried out in accordance with the following rules :

- Expenses and costs - mainly payroll and miscellaneous costs - relating to operations and particular events occurringduring the financial year and involving one or more of the members of the association are charged directly to themember or members concerned on an actual or lump sum basis depending on the circumstances, and on the basisof appropriate documentation.

- The balance of the expenses and charges is allocated proportionally among the members of the association inaccordance with a formula based primarily on estimated net assets, annual movement in net assets and grossoperating income.

A statement of costs is drawn up at the end of each financial year indicating, by income statement item, the shareallocated to each member of the association.

(1) NPM/CNP is also charged, based on actual services rendered, with invoices from CENTRE DE COORDINATION DE CHARLEROI (accounting,treasury, personnel and administration services) and by COMPAGNIE IMMOBILIÈRE DE ROUMONT (management of the building and of theshareholdings).

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REFERENCE DOCUMENT RELATING TO A POSSIBLEPUBLIC SUBSCRIPTION OFFER OF SHARES AND THEIR LISTING

ON THE PRIMARY MARKET

In the framework of the dissociated information procedure laid down by the Royal Decree of 13 February 1996,NPM/CNP has adapted the content of its annual report to allow it to be used as reference document for the possibleissue of listed shares.

In such a case, this document together with the operations note published at the time of the issue will constitute theprospectus in accordance with schemes A or B of the Royal Decree of 18 September 1990.

In order to aid the reader locate the information provided by this Royal Decree, this document incorporates areference table ; in those cases where the information is not readily available by other means, the information itself isprovided.

If a public issue does indeed take place, the information included in the present annual report will be updated in thetransaction notice.

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Part I : INFORMATION REGARDING RESPONSIBILITY FOR THE PROSPECTUS AND FOR THE AUDIT OFTHE ACCOUNTSThis information will be included in the eventual operations note.

Part II : INFORMATION RELATING TO THE SHARES AND THEIR LISTING ON THE PRIMARY MARKETThis information will be included in the eventual operations note.

Part III : INFORMATION ABOUT THE COMPANY AND ITS SHARE CAPITAL

3.1. Identification of the Company

3.1.0. Name, registered and administration officesNATIONALE PORTEFEUILLEMAATSCHAPPIJ N.V. / COMPAGNIE NATIONALE À PORTEFEUILLE S.A.,abbreviated to NPM/CNP.The registered office of the Company is at 6280 Loverval (Gerpinnes), rue de la Blanche Borne, 12. The registeredoffice may be transferred to any location in Belgium by decision of the Board of Directors.

3.1.1. Date of incorporation and durationThe Company was incorporated for an unlimited duration on 20 November 1906 under the name « LE GAZ RICHE »as a public company with limited liability (« société anonyme »), by public deed executed by Maître Émile LEFÈBVRE,public Notary in Antwerp, published in the annex of the Belgian « Official Gazette » dated 3-4 December 1906, undernumber 6133.The articles of incorporation have been amended for the last time by public deed executed by Maître Hubert MICHEL,public Notary in Charleroi under the intervention of Maître Gilberte RAUCQ, public Notary in Brussels on 11 June1997, published in the annex of the Belgian « Official Gazette » on 4 July 1997.

3.1.2. Legislation under which the Company operates and legal formSee point 3.1.1.

3.1.3. Objects of the CompanyAccording to Article 3 of the statutes :« The objects of the Company are the purchase, the sale, the assignment, the exchange and the management of anysecurities, shares, bonds, government bonds or any other financial or non financial assets or rights ; the holding underany form, in any company or business in the production and/or distribution of energy, or in industry, commerce,finance, real estate or other, existing or to be incorporated.Among others, NPM/CNP may acquire through purchase, exchange, contribution, subscription, underwriting, option orany other means, any security, asset, receivables or intangible asset ; participate in any association or merger ;manage or enhance the value of its securities and shareholdings portfolio ; realise or liquidate such assets byassignment, sale or any other means.NPM/CNP may conduct any financial, commercial, industrial and real estate operations or transactions, directly orindirectly related to its objects or designed to realise such objects. ».

3.1.4. Commercial registersThe Company is registered in the commercial registers of Charleroi under number 161,072.

3.1.5. Places of consultation of public documentsThe co-ordinated articles of incorporation of NPM/CNP may be consulted at the Commercial Court in Charleroi and inthe registered office of NPM/CNP.The annual accounts are filed with the NATIONAL BANK OF BELGIUM. All appointment and dismissal of therepresentatives of NPM/CNP are published in the annex of the Belgian « Official Gazette ».Financial notices are published in the financial press and on the internet website (http://www.cnp.be). The otherdocuments available to the public and mentioned in an eventual prospectus may be consulted at the registered officeof NPM/CNP.The annual reports are sent to the registered shareholders and to each person asking to receive them.

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3.2. Share capital

3.2.0. Issued capitalThe fully paid share capital of the Company amounts to BEF 4,751,250,000. It is represented by 25,340,000 shareswith no designated nominal value of which 24,806,830 are ordinary shares, 48,400 are AFV1 shares, 770 are AFV2shares, 242,000 are AFV3 shares and 242,000 are AFV4 shares.The ordinary shares include notably 1,474,970 VVPR shares issued by public subscription and 1,740,460 VVPRshares placed with the company FIBELPAR which were the object of a limited subscription with the issuer. The rightsattached to the shares are the following :a. Right to vote at General Meetings

Each share carries one vote.b. Preferential rights in the event of share capital increases

In the event of a share capital increase by cash subscription, the new shares must be offered in the first instanceto existing shareholders pro rata to the number of shares held on the day of issue, as prescribed by law.The General Meeting nonetheless has the right to cancel or to limit the preferential subscription rights in theinterest of the company to the extent permitted by the Co-ordinated Laws on Commercial Companies, or tosuspend the rights for a limited period.Any proposal by the Board of Directors to limit or to suspend the preferential subscription rights must be justified ina detailed report, which covers in particular the issue price and the financial consequences for Shareholders. Areport is also made up by the Auditors, in which they state that the financial information and the accountscontained in the report by the Board are correct. These reports are filed with the clerk of the Commercial Tribunal.In the event of a share capital increase by cash subscription, the holders of convertible bonds, of bondsredeemable in shares, of subscription rights or of other securities, may convert their holding or exercise theirsubscription rights and thus participate in the new issue to the extent that this right is bestowed on existingshareholders.The Board of Directors always retains the right to conclude agreements under, conditions which it deemsappropriate, with any third party in order to ensure the subscription of all or part of the issue shares.

c. Appropriation of profitsNet profits are allocated as follows :1. A minimum of 5 % is transferred to the legal reserve until this reaches 10 % of share capital.2. The remaining amount is allocated as decided upon by the General Meeting following a proposal by the Board

of Directors.Nevertheless, existing AFV shares which benefit from the advantages provided for by Royal Decrees 15 and 150,are also assigned the saving made by the company as a result of the tax exemption of income assigned to suchAFV shares - to the extent that an ordinary dividend is declared. This additional benefit is limited to tax savingsmade, or which will be made in the future, in relation to the financial year ending no later than 31 December 1996(tax year 1997).The Board of Directors may, within the conditions laid down by law, distribute advances on the dividend forthe year.

d. LiquidationIn the event of the liquidation of the company, the net assets, after payment of all debts, charges and liquidationcosts, will be used in the first instance to reimburse the paid up portion of share capital - in cash or in securities.The remaining balance will be distributed equally over all shares.

3.2.1. Authorised share capitalBy decision of the Shareholders’ Extraordinary General Meeting of 12 June 1996, the Board of Directors authorised,for a period of five years starting on 9 July 1996, to increase share capital by up to BEF 2 billion in one or morestages. The method used to increase the share capital is to be determined by the Board and may consists of theissue of shares with or without voting rights. This authorisation may be renewed in accordance with relevant laws. Theincrease in share capital decided on with regards to this authorisation may incorporate cash or non-cash considerationor may, to the extent permitted by the Co-ordinated Laws on Commercial Companies (CLCC), incorporate the use ofreserves including the share premium reserve.

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The use of reserves may take place with or without the issue of new securities. The Board of Directors is expresslypermitted to proceed with share capital increases under the condition laid down by the CLCC, in the case of atakeover bid relating to securities issued by the company and on condition that notice to this effect is given to theBANKING AND FINANCE COMMISSION within 3 years of the Extraordinary General Meeting of 12 June 1996. In theevent where the Board of Directors decides to increase share capital in the framework of the authorisation by the issueof shares by cash subscription, of convertible bonds, of bonds redeemable in shares, of subscription rights or of othersecurities, it may, in the interest of the company and under the conditions laid down by the CLCC, limit or cancel thepreferential rights of existing shareholders, to the advantage of a person or specific persons even if these are not staffmembers of the company or its subsidiaries.Under the same conditions and in accordance with 101 bis to 101 octies of the CLCC. The Board of Directors is alsoauthorised to proceed with the issue of convertible bonds or bonds redeemable in shares (whether subordinated ornon-subordinated), of subscription rights or other securities (whether or not attached to bonds), or other financialinstruments which could lead to an increase in share capital of up to BEF 2 billion.In the framework of this authorisation, the exercising of all warrants in issue would utilise authorised share capital ofBEF 318,750,000 (i.e. the maximum increase in share capital resulting from the exercising of the 1,500,000 warrantsissued on 28 February 1994 and the 200,000 warrants granted to staff members and certain Directors).

3.2.2. Shares not representing the capitalThere are no such shares.

3.2.3. Bonds issued, liabilities and commitments of the CompanyIn March 1994, the Company issued 30,000 A bonds 6.70 % 1994-1999 with a unitary nominal value of BEF 50,000,totalling BEF 1,500,000,000.Simultaneously the Company issued 750,000 B bonds 5.0625 % 1994-1999 with a unitary nominal value ofBEF 2,365, totalling BEF 1,773,750,000. These bonds were accompanied by two warrants exercisable between1 June and 15 June of 1994 and 1999 by subscription to one NPM/CNP share at the price of BEF 2,365 ; this gives atotal of 1,500,000 warrants. In accordance with the aim of the Company to gradually widen the membership, thesebonds were however offered on the Belgian market accompanied by one warrant only, and the other 750,000 weresold on the international market.The detail of the most significant other debts can be found on page 69 of this annual report.None of the Company’s bonds or debts are subject to specific guarantees given on any of its assets. Major off-balancesheet commitments are detailed on page 79 of this annual report.

3.2.4. Conditions for changes to the capital and to the rights of the various categories of sharesThe statutes of the Company do not include provisions regarding capital and rights modifications which would be morerestrictive than the legal provisions.

3.2.5. Changes in the share capital over the last three years and during the current yearNo capital increase has taken place over the last three years.

3.2.6. Persons in a position to influence the Company ...................................................................................page 253.2.7. Shareholders holding more than 5 % of the capital ..............................................................................page 983.2.8. Brief description of the Group ...................................................................................pages 25 à 27, 74 and 853.2.9. Own shares .............................................................................................................................pages 12 and 67

The Annual General Meeting of 11 June 1997 authorised the Board of Directors to acquire up to 1,500,000 shares inthe Company on the stock market at a minimum price of BEF 1,500 and a maximum price of BEF 3,000 per share,valid for a period of 18 months. It will be proposed to the Extraordinary General Meeting of Shareholders on 13 May1998 to renew this authorisation with a minimum price of BEF 1,500 and a maximum price of BEF 4,500.This provision applies to shares in the Company acquired by one or more of its subsidiaries in the sense of article 52quinquies § 1, second sub-paragraph of the co-ordinated laws on commercial companies.The Board of Directors may dispose of Company shares, on the stock market or in any other manner provided forunder the law, without the prior authorisation of the General Meeting.The Board of Directors was authorised, in compliance with the law, for a period of three years as from 4 July 1997, toacquire and dispose of shares in the Company in the cases provided for in article 52 bis § 4 sub-paragraph 2.2 for thepurpose of preventing serious and imminent danger to the Company.

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Part IV : INFORMATION ON THE ACTIVITIES OF THE COMPANY

4.1. Major activities of the Company4.1.0. Description of the major activities of the Company.........................................................................inside cover4.1.1. Breakdown of profit and of estimated value............................................................................... pages 13 to 224.1.2. Major branches and real-estate properties ....................................................................... pages 12, 62 and 764.1.3. Assessment of economically exploitable reserves and their probable duration

This information is not relevant in the case of NPM/CNP.4.1.4. Exceptional events ................................................................................................................................page 22

4.2. Dependence on licences and contractsThe activity of the Company does not depend on licences or on specific contracts having a significant impact on its futurefinancial situation.

4.3. Research and developmentThis information is not relevant in the case of NPM/CNP. As a holding company, NPM/CNP does not conduct research anddevelopment efforts.

4.4. Litigation or arbitrationTo the Board of Directors’ best knowledge, there is no pending litigation or arbitration which could have a significant impacton the financial situation of the Company (please also refer to page 79, note 2).

4.5. Going concernThe Company has not experienced recently any interruption in its business and is not aware of any event likely tocompromise the conduct of its activities.

4.6. Average staff number and evolution.................................................................................................................page 79

4.7. Investment policy

4.7.0. Major investments of the last three years and of the current financial year............... pages 9 to 11, 81 and 824.7.1. Major investments in progress and financing............................................................................... pages 9 to 114.7.2. Major investment commitments

No significant investment commitment was made by the Company, at the date of press of this document.

Part V : FINANCIAL INFORMATION

5.1. Accounts

5.1.0. Balance sheets and profit and loss accounts............................................................................. pages 94 to 975.1.1. Consolidated balance sheets and profit and loss accounts ....................................................... pages 62 to 65

5.1.2. Net operating profit per shareThe non-consolidated net operating profit per share has been (in BEF) :

1997 1996 199585.80 119.37 115.74

NPM/CNP being a holding company, the non-consolidated accounts are of little significance. The restrictedconsolidated and consolidated results per share are shown page 61.

5.1.3. Dividend per share .................................................................................................................. pages 24 and 61

5.1.4. Half-year resultsIn case more than nine months have elapsed since the end of the latest financial year, half-year results will beincluded in the operations note.

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5.1.5. Additional information in the case of non conformity to the European GuidelinesThe accounts of NPM/CNP being in conformity with the guidelines of the European Union, no additional informationneeds to be provided.

5.1.6. Sources and applications of funds ..........................................................................................pages 81 and 82

5.2. Information on shareholdings of the Company...........................................................pages 26 to 56, 75 and 84 to 92

5.3. Information on more than 10% held shareholdings....................................................................pages 26 to 56 and 75

5.4. Information on the consolidated accounts .....................................................................................................pages 59 to 92

5.5. Information in parts 4 and 7, extended to the Group levelThe information required in parts 4 and 7 is already extended to the Group level.

Part VI : INFORMATION ABOUT DIRECTORS, MANAGEMENT AND AUDITORS

6.1. Name, functions and major activities of the Directors, the members of the Executive Committeeand the Statutory Auditors .................................................................................................................................pages 2 and 3

John DILS, Chairman of the Board of Directors Independent non-executive DirectorMr. John DILS is Chairman of the Board of Directors of CONTRÔLE TECHNIQUE AUTOMOBILE « C.T.A. » and HonoraryVice-Chairman of the Board of Director of BBL. He is also Director of the ROYAL AUTOMOBILE CLUB DE BELGIQUE“R.A.C.B.” and of S.G.S. BELGIUM (SOCIÉTÉ GÉNÉRALE DE SURVEILLANCE).

Gilles SAMYN, Managing Director Executive DirectorMr. Gilles SAMYN is Managing Director of FRÈRE-BOURGEOIS, ERBE and FIBELPAR. He is Member of the ExecutiveCommittee of PARGESA and of GROUPE BRUXELLES LAMBERT, Chairman of the Board of Directors of ÉDITIONS DUPUIS,HÉLIO CHARLEROI, TRANSCOR and IJSBOERKE, and Director of various companies including IMÉTAL, PETROFINA andCLT-UFA.

Jean CLAMON, Director Non-executive DirectorMr. Jean CLAMON is Member of the Management Committee of BANQUE PARIBAS and Managing Director of ERBE. He isalso Director of COMPAGNIE DE NAVIGATION MIXTE, COBEPA, FIBELPAR and COMPAGNIE GÉNÉRALE MOSANE.

Laurent DASSAULT, Member of the Executive Committee Non-executive MemberMr. Laurent DASSAULT is Managing Director of DASSAULT INVESTISSEMENTS, Joint Managing Director of CHÂTEAUDASSAULT-ST-ÉMILION, Director of FINANCIÈRE ET IMMOBILIÈRE MARCEL DASSAULT and of BANQUE ROTHSCHILDLUXEMBOURG, and of various companies including DASSAULT INDUSTRIES, DASSAULT SYSTÈMES and DASSAULTBELGIQUE AVIATION.

Victor DELLOYE, Director - Secretary-General Executive DirectorMr. Victor DELLOYE is Director of FRÈRE-BOURGEOIS and of related companies. He is also Director of ROYALE BELGE.

Pierre-Alain DE SMEDT, Director Independent non-executive DirectorMr. Pierre-Alain DE SMEDT is Chairman of the Executive Committee of SEAT S.A. and Member of the world-wide ManagementCommittee of VOLKSWAGEN.

Thierry DORMEUIL, Director Non-executive DirectorMr. Thierry DORMEUIL is Member of the Executive Committee and Responsible of the agri-food, luxury goods, textile andbuilding materials sectors of the Consulting Department of the PARIBAS Group, Director of COMPAGNIE DE NAVIGATIONMIXTE, GUYORMARC’H, NORD EST, AXA RE FINANCE and COBEPA. He also represents SOCIÉTÉ GÉNÉRALECOMMERCIALE ET FINANCIÈRE at the Board of Directors of VIA BANQUE.

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Jacques FOREST, Director Non-executive DirectorMr. Jacques FOREST is Chairman of the Management Committee of P&V ASSURANCES, Censor of the NATIONAL BANK OFBELGIUM and Director of several companies including MULTIPHARMA and NAGELMACKERS.

Baron FRÈRE, Director (until 2 April 1998) Non-executive DirectorBaron FRÈRE is Chairman of the Board of Directors of FRÈRE-BOURGEOIS, ERBE, FIBELPAR, PETROFINA and ofELECTRAFINA, Chairman of the Board and Managing Director of GROUPE BRUXELLES LAMBERT and Vice-Chairman ofPARGESA HOLDING, PARFINANCE and ROYALE BELGE. He is Member of the Board of Trustees of SUEZ LYONNAISEDES EAUX, and Director of several companies including CLT-UFA, HAVAS, TF1 and LVMH. Baron FRÈRE is also HonoraryMember of the Board of Directors of the NATIONAL BANK OF BELGIUM.

Gérald FRÈRE, Director Non-executive DirectorMr. Gérald FRÈRE is Managing Director of FRÈRE-BOURGEOIS and Chairman of the Executive Committee of GBL. He is a.o.Director of ERBE, FIBELPAR, PARGESA, PARFINANCE, ROYALE BELGE, COBEPA and GIB. He is also Member of theBoard of Directors of the NATIONAL BANK OF BELGIUM.

Ségolène FRÈRE, Director (from 2 April 1998) Non-executive DirectorMiss Ségolène FRÈRE is student at the VESALIUS COLLEGE - VUB.

Jean-Pierre GERARD, Director Non-executive DirectorMr. Jean-Pierre GERARD is Managing Director of ROYALE BELGE. He is Member of the Executive Committee of AXA-UAPand Director of several companies of the ROYALE BELGE Group. He is also Member of the Executive Committee of UNIONPROFESSIONNELLE DES ENTREPRISES D’ASSURANCES (Professional Association of Insurance Companies) and Memberof the INSURANCE COMMISSION.

Philippe HUSTACHE, Director Non-executive DirectorMr. Philippe HUSTACHE is Managing Director of FINANCIÈRE ET IMMOBILIÈRE MARCEL DASSAULT and Director ofseveral companies including SANOFI and BANQUE VERNES.

Marcel NICOLAÏ, Director Independent non-executive DirectorMr. Marcel NICOLAÏ is Chairman of the Management Committee of VICTOIRE ASSET MANAGEMENT and manager of severalunit trusts.

Thierry de RUDDER, Director Non-executive DirectorMr. Thierry de RUDDER is Managing Director of GROUPE BRUXELLES LAMBERT and ELECTRAFINA. He is Chairman ofthe Board of Directors of BERNHEIM-COMOFI and Director of AUDIOFINA, ROYALE BELGE, PETROFINA, SOCIÉTÉGÉNÉRALE DE BELGIQUE, TRACTEBEL, MONUMENT OIL AND GAS (U.K.) and of several companies of GROUPEBRUXELLES LAMBERT.

Baron SANTENS, Director Independent non-executive DirectorMr. Marc SANTENS is Chairman of the SANTENS textile group.

Jo SANTINO, Director Non-executive DirectorMr. Jo SANTINO is Managing Director of COMPAGNIE GÉNÉRALE MOSANE and Member of the Management Committee ofCOBEPA. He is also Chairman of BERGINVEST and of T. PALM. He is Director of several other companies, includingFLORIDIENNE, SCHRÉDER, AUTOMATIC SYSTEMS, ARVAL BELGIUM and L’ÉCHO.

Gustaaf VAN den BEMPT, Director Independent non-executive DirectorMr. Gustaaf VAN den BEMPT is Master in Law and in Notary Right and Certified Accountant. He works as crisis manager forcompanies experiencing difficulties and as management consultant for small and medium-sized companies.

Philippe WILMES, Director Independent non-executive DirectorMr. Philippe WILMES is Chairman of the Executive Committee of SOCIÉTÉ FÉDÉRALE D’INVESTISSEMENT and ofSOCIÉTÉ BELGE D’INVESTISSEMENT INTERNATIONAL. He is also Member of the Board of Directors of the NATIONALBANK OF BELGIUM and Director of several companies including TRACTEBEL, CODITEL and of the BANK FORINTERNATIONAL PAYMENTS.

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Statutory Auditors

KLYNVELD PEAT MARWICK GOERDELER, Reviseurs d’Entreprises S.C.C.,Spoorweglaan, 3 – B-2610 Wilrijkrepresented by Georges M. TIMMERMAN

DELOITTE & TOUCHE, Reviseurs d’Entreprises S.C.C.,Brussels Airport Business Park - Berkenlaan, 6 – B-1831 Diegemrepresented by Claude POURBAIX

6.2. Relations with Directors and Managers

6.2.0. Salaries and fringe benefitsBased upon the 1997 accounts (in ,000 BEF) :

paid by theCompany

paid by subsidiariesof the Company

paid by theequity-accounted

companies (1)To Directors of the Parent Company- members of the Executive Committee- other directors

18,4513,150

1,952950

5,337-

21,601 2,902 5,337

To Members of the Executive Committee who are notDirectors 300 - n.a.

Advances and loans granted to Directors and Membersof the Executive Committee - - -

(1) only relates to Executive Directors ; in addition, PARJOINTCO paid in 1997 an amount of BEF 11,168(,000) to FRÈRE-BOURGEOIS HOLDING inconsideration for services rendered by its representatives.

The fees paid in 1997 to the Statutory Auditors of the Company in remuneration for their mandates amounted toBEF 360(,000). For additional services, DELOITTE & TOUCHE received an amount of BEF 346(,000) in 1997.

6.2.1. Shares and options of the CompanyAt 31 December 1997, no Director or Auditor was listed as a registered shareholder of the Company. Members of theBoard of Directors and of the Executive Committee were registered for 33,578 warrants at the same date. Thesewarrants can be exercised until November 1999 by subscription to one NPM/CNP share at the price of BEF 1,696.

6.2.2. Conflicts of interestsIn such instances, the Board of Directors establishes a special report included in the Annual Report of the Company inaccordance with legal requirements.

6.2.3. Loans and advancesSee point 6.2.0.

6.3. Stock option planThe Company issued on 30 June 1990 200,000 warrants reserved for the Personnel and the Managers ; these warrants canbe exercised until November 1999 by subscription to one NPM/CNP share at a price of BEF 1,696.At the date of press of this document, notwithstanding realised transactions, no warrant had been exercised yet.

Part VII : INFORMATION ON THE RECENT EVOLUTION AND PROSPECTS OF THE COMPANY

Information available at the date of press of this document is included in the Directors’ report (pages 9 to 12 and 23) ; should apublic subscription offer take place, the related information would be updated in the operations note.

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ADJUSTMENT FACTORS

BASE PRINCIPLESVarious adjustment factors are used in order to allow data related to different years to be compared, cancelling the diluting effect ofcapital increases.

COMPUTATION METHODS1. Factors applicable to results and dividends

These adjustment factors cancel the diluting effect of effectively carried out capital increases and are computed based uponthe non-diluted estimated value.

2. Factors applicable to the fully diluted estimated valueThese adjustment factors cancel the diluting effects of effective or potential (warrants) capital increases and are calculatedbased upon the fully diluted estimated value.

3. Factors applicable to stock market pricesThese adjustment factors are of course computed based upon the stock market prices.

YEARLY ADJUSTMENT FACTORS

1. results and dividends 2. estimated value (fully diluted) 3. stock market prices

1987 0.8713 0.8527 0.94661988 0.8764 0.9056 0.98671989 0.9501 0.9494 1.00001990 0.9701 0.9515 1.00001991 0.9778 0.9591 1.00001992 0.9778 0.9591 1.00001993 0.9778 0.9591 1.00001994 1.0000 0.9809 1.00001995 1.0000 0.9817 1.00001996 1.0000 0.9896 1.00001997 1.0000 1.0000 1.0000

glossary

Consolidation perimeter including the NPM/CNP par-ent company and its subsidiary holding or financialcompanies integrated globally or proportionally (seepages 60 and 74).Shareholdings appear on the balance sheet at theiracquisition price and contribute to earnings by theamount of the dividends paid to the NPM/CNP Group.

Perimeter in which, unlike restricted consolidation,companies in which there is a sole or joint holding ofat least 20% (the PARGESA Group, ACP, BERNHEIM-COMOFI, ÉDITIONS DUPUIS, HÉLIO CHARLEROI,IJSBOERKE, PETROFINA, ROYALE BELGE,TRANSCOR and SUZY) are valued using the equitymethod; these companies are therefore posted in theconsolidated accounts giving the sum of the sharereverting to NPM/CNP of their equity capital (consoli-dated balance sheet) and of their earnings (consoli-dated income statement).

The portion of the earnings including the operatingincome generated by shareholdings (restricted consol-idated dividends and, where applicable, earnings ofindustrial and comercial companies accounted forusing the equity method) and net financial incomeafter deduction of operating costs and taxes.

The share of the earnings of holding companies con-solidated or valued using the equity method from cap-ital gains or losses and reductions (or increases) invalue on financial investments, depreciation of andequity valuation of goodwill and other exceptionalincome and expenditure.

Analysis taking into account the PARGESA Group as ashareholding and therefore not extending to its com-ponent parts.

Analysis decomposing the PARGESA Group into itscomponent parts.

Valuation of the NPM/CNP share based on the criteriaset out on page 13.

Difference (expressed as a percentage) between theestimated value of the share and the stock marketquotation.

Internal annual cumulated rate of return for the share-holder in the form of both the dividend and the appre-ciation in the value of his assets. Used in combinationwith the reference value, this provides an instrumentfor measuring internal performance, excluding anyinfluence of flows to and from shareholders (newissues, dividends, etc.) (see pages 14 to 17).

Data solely concerning existing shares and excludingany potential effects from the exercise of warrants.

Data taking into account the exercise of any warrants.

Restrictedconsolidation

Consolidation

Operating income

Capital income

Directanalysis

Transitiveanalysis

Estimated valueper share

Discount

TotalShareholders’

Return

Non diluted data

Fully diluted data

59


Introductory comments..................................................................................................... 60

Key figures........................................................................................................................ 61

Balance sheets................................................................................................................. 62


Balance sheets - notes..................................................................................................... 66

Analytical profit and loss statements ................................................................................ 70

Profit and loss statements - notes.................................................................................... 71

Appendix........................................................................................................................... 73

Statements of cash flows ................................................................................................. 81

Statements of cash flows - notes ..................................................................................... 82

Auditors’ report ................................................................................................................. 83

PARJOINTCO - summary consolidated accounts ........................................................... 84

Summarized financial statements of major non-listed shareholdings .............................. 90

60


INTRODUCTORY COMMENTS

Since 1990, NPM/CNP has made public consolidated accounts including, using the equitymethod, PARJOINTCO (itself consolidating PARGESA and therefore incorporating GBL andPARFINANCE) and shareholdings of at least 20 % in companies held by the Group.

The Company also publishes restricted consolidated accounts which only incorporate fullyowned financial companies, as well as AGESCA NEDERLAND (89.54 %) and its subsidiaryN.F. ASSOCIATES, and the proportional inclusion of the statutory accounts of the jointlycontrolled PARJOINTCO, GROUPE JEAN DUPUIS and CENTRE DE COORDINATION DECHARLEROI.

The restricted consolidated accounts only include, in addition to the results of financialcompanies controlled by NPM/CNP, the flows of dividends (as opposed to the results, in theconsolidated accounts) for PARGESA and for equity accounted companies in which it has aholding of at least 20 % (ACP, BERNHEIM-COMOFI, ÉDITIONS DUPUIS, HÉLIOCHARLEROI, PETROFINA, ROYALE BELGE, TRANSCOR, SCI & ASSOCIÉS up to June1996 and SUZY as from 1997).

Please note the following :

� As NPM/CNP owned the SUZY Group (comprised of three entities : SUZY, DESOBRYand DRIEHOEK) at the beginning of 1997, the results of this Group were equityaccounted in the consolidated accounts of NPM/CNP as from 1997.

� As IJSBOERKE was not acquired by NPM/CNP until December 1997, this Group was onlyequity accounted on the balance sheet, as at 31 December 1997 ; it will only contribute tothe consolidated results of NPM/CNP as from 1998.

� Following the capital gains made in 1996 (TRACTEBEL) and 1997 (50 % of CLT andBBL) within the PARGESA Group, it was decided to proceed with an exceptionaldepreciation of the goodwill which had negatively affected the earnings of the NPM/CNPGroup by BEF 411 million in 1996, and by BEF 278 million in 1997.

� Finally, during 1997, PETROFINA adopted American accounting methods (US GAAP) ;NPM/CNP’s share of the resulting decrease in the equity of PETROFINA(BEF 583 million) was posted as a reduction in the consolidated reserves.

61


KEY FIGURES

Consolidated accounts Restricted consolidated accounts

(BEF thousand except for data per share) 1997 1996 1995 1997 1996 1995

EQUITY

� total 61,323,309 55,556,575 52,172,585 55,298,283 54,227,614 52,693,654

� Group share 58,815,540 53,486,338 50,526,275 53,602,196 52,588,592 51,350,577

� minority interests 2,507,769 2,070,237 1,646,310 1,696,087 1,639,022 1,343,077

NET PROFIT

� total 8,103,565 5,253,325 2,451,973 3,718,296 3,881,119 2,152,229

� Group share : 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

� operating income 4,820,637 3,935,461 3,604,356 2,850,102 2,616,402 2,589,112� capital result 2,878,189 1,147,203 (1,240,701) 806,595 1,209,772 (488,816)

including amortisation of goodwill (transitively) (1) (665,598) (769,204) (403,248) - (821) -

� minority interests 404,739 170,661 88,318 61,599 54,945 51,933

GROSS DIVIDENDS 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188

NUMBER OF SHARES IN ISSUE 25,340,000 25,340,000 25,340,000 25,340,000 25,340,000 25,340,000

ADJUSTED DATA PER SHARE (in BEF)

� operating income 190.24 155.31 142.24 112.47 103.25 102.17

� capital result 113.58 45.27 (48.96) 31.83 47.74 (19.29)

including amortisation of goodwill (transitively) (1) (26.27) (30.36) (15.91) - (0.03) -

� earnings per share 303.82 200.58 93.28 144.31 150.99 82.88

� gross dividend per ordinary share 104.00 102.00 100.00 104.00 102.00 100.00

(1) Includes amortisation of goodwill by NPM/CNP as well as NPM/CNP’s transitive share in the amortisation of goodwill recorded by its financial subsidiaries and byPARJOINTCO, PARGESA, GBL, PARFINANCE and the sub-holdings controlled by those groups.

62


BALANCE SHEETS

ASSETS (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995

FIXED ASSETS 51,276,777 46,390,729 49,787,068 45,456,168 45,244,680 50,441,983I. Formation expenses - - - - - -II. Intangible assets - - - - - -III. Goodwill 3,001,383 1,998,161 2,199,310 - - -IV. Tangible fixed assets 346,157 220,486 76,737 346,323 220,689 76,986

A. Land and buildings 48,446 20,541 28,539 48,446 20,541 28,539B. Plant, machinery and equipment - - - - - -C. Furniture and vehicles 89,249 17,323 9,032 89,415 17,526 9,281D. Leasing and other similar rights - - - - - -E. Other tangible assets 208,462 - - 208,462 - -F. Assets under construction and advance

payments - 182,622 39,166 - 182,622 39,166V. Investments 47,929,237 44,172,082 47,511,021 45,109,845 45,023,991 50,364,997

A. Equity-accounted companies 37,602,032 32,424,814 35,151,974 - - -1. Shares 37,327,032 32,349,814 33,303,978 - - -2. Bonds 275,000 75,000 1,847,996 - - -

B. Other companies 10,327,205 11,747,268 12,359,047 45,109,845 45,023,991 50,364,9971. Stocks and shares 10,327,196 11,747,262 12,359,040 44,834,836 44,948,985 48,516,9942. Bonds and other amounts receivable 9 6 7 275,009 75,006 1,848,003

CURRENT ASSETS 23,008,325 23,464,663 13,423,037 23,024,354 23,520,320 13,498,005VI. Amounts receivable after more than one year - - - - - -

A. Trade receivables - - - - - -B. Other receivables - - - - - -

VII. Stocks and contracts in progress - - - - - -A. Stocks - - - - - -B. Contracts in progress - - - - - -

VIII. Amounts receivable within one year 7,389,086 9,201,745 3,577,524 7,199,180 9,070,976 3,579,505A. Trade receivables 44,389 7,023 7,045 44,389 7,023 7,045B. Other receivables 7,344,697 9,194,722 3,570,479 7,154,791 9,063,953 3,572,460

IX. Short-term investments 9,103,336 7,006,513 6,050,957 9,285,946 7,189,652 6,079,693A. Own shares 747,018 872,095 - 747,018 872,095 -B. Other investments and deposits 8,356,318 6,134,418 6,050,957 8,538,928 6,317,557 6,079,693

X. Cash at bank and in hand 6,224,919 7,161,654 3,633,138 6,243,808 7,164,153 3,677,372XI. Deferred expenses and accrued income 290,984 94,751 161,418 295,420 95,539 161,435

TOTAL ASSETS 74,285,102 69,855,392 63,210,105 68,480,522 68,765,000 63,939,988

63


BALANCE SHEETS

LIABILITIES AND EQUITY (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995

EQUITY 58,815,540 53,486,338 50,526,275 53,602,196 52,588,592 51,350,577I. Share capital 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250

A. Issued capital 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250 4,751,250B. Uncalled capital - - - - - -

II. Share premium account 42,824,428 42,824,428 42,824,428 42,824,428 42,824,428 42,824,428III. Revaluation surplus - - - - - -IV. Reserves 13,107,417 8,627,375 6,129,391 5,966,524 4,945,187 3,703,693V. Negative goodwill 214,634 226,029 222,231 149,459 149,459 149,459VI. Translation adjustments (2,082,189) (2,942,744) (3,401,025) (89,465) (81,732) (78,253)VII. Investment grants - - - - - -

MINORITY INTERESTS 2,507,769 2,070,237 1,646,310 1,696,087 1,639,022 1,343,077VIII. Minority interests 2,507,769 2,070,237 1,646,310 1,696,087 1,639,022 1,343,077

PROVISIONS AND DEFERRED TAXATION 38,000 41,500 303,357 38,000 41,500 269,250IX. A. Provisions for liabilities and charges 38,000 41,500 303,357 38,000 41,500 269,250

1. Pensions and similar obligations - - - - - -2. Tax provisions - - - - - -3. Major repairs and maintenance - - - - - -4. Other liabilities and charges 38,000 41,500 303,357 38,000 41,500 269,250

B. Deferred taxation - - - - - -

LIABILITIES 12,923,793 14,257,317 10,734,163 13,144,239 14,495,886 10,977,084X. Amounts payable after more than one year 3,273,750 3,273,750 3,273,750 3,508,668 3,493,032 3,510,311

A. Financial liabilities 3,273,750 3,273,750 3,273,750 3,508,668 3,493,032 3,510,3111. Subordinated loans - - - - - -2. Unsubordinated debentures 3,273,750 3,273,750 3,273,750 3,273,750 3,273,750 3,273,7503. Finance leasing liabilities - - - - - -4. Amounts due to financial institutions - - - 234,918 219,282 236,5615. Other loans - - - - - -

B. Trade payables - - - - - -1. Suppliers - - - - - -2. Notes payable - - - - - -

C. Advances received on contracts in progress - - - - - -D. Other liabilities - - - - - -

XI. Amounts payable within one year 9,179,586 10,737,303 7,139,612 9,152,745 10,742,200 7,139,607A. Current portion of long-term debt - - - - - -B. Financial debts 6,255,298 7,662,381 4,238,123 6,255,298 7,664,054 4,238,123

1. Amounts due to financial institutions 1,692,793 1,462,116 1,338,123 1,692,793 1,462,116 1,338,1232. Other loans 4,562,505 6,200,265 2,900,000 4,562,505 6,201,938 2,900,000

C. Trade payables 38,872 47,852 24,586 38,872 47,852 24,5861. Suppliers 38,872 47,852 24,586 38,872 47,852 24,5862. Notes payable - - - - - -

D. Advances received on contracts in progress - - - - - -E. Taxes, salaries and social charges payable 135,746 114,170 53,786 135,746 117,394 53,786

1. Taxes 130,256 108,775 48,954 130,256 111,999 48,9542. Salaries and social charges 5,490 5,395 4,832 5,490 5,395 4,832

F. Other liabilities 2,749,670 2,912,900 2,823,117 2,722,829 2,912,900 2,823,112XII. Accrued expenses and deferred income 470,457 246,264 320,801 482,826 260,654 327,166

LIABILITIES AND EQUITY 74,285,102 69,855,392 63,210,105 68,480,522 68,765,000 63,939,988

64



EXPENSES (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995A. Interest expense 402,002 444,711 465,452 420,794 456,316 475,140B. Other financial expense 164,892 155,541 283,405 191,119 156,916 290,532B.bis Amortisation of goodwill 155,820 152,436 155,420 - 821 -C. Miscellaneous goods and services 89,367 86,086 70,428 90,758 86,086 72,220D. Payroll expenses 89,274 79,538 79,369 105,745 96,522 83,452E. Miscellaneous operating expenses 10,122 7,249 4,362 10,122 7,249 4,362F. Depreciation and write-off of formation expenses,

tangible and intangible assets 17,021 3,003 6,241 17,058 3,049 6,297G. Write-down on 127,427 252,463 703,407 127,427 252,463 741,234

1. long-term investments - 249,330 556,403 - 249,330 594,2302. current assets 127,427 3,133 147,004 127,427 3,133 147,004

H. Provisions for liabilities and charges - - 6,410 - - 6,410I. Losses on disposal of 130 16,295 17,709 130 16,295 17,709

1. tangible and intangible fixed assets 88 15 293 88 15 2932. long-term investments - - 3,937 - - 3,9373. current assets 42 16,280 13,479 42 16,280 13,479

J. Exceptional expenses 33,168 105,754 136,000 33,168 105,754 136,000K. Taxes 49,283 59,219 29,791 49,283 65,970 29,791K.bis Losses of equity-accounted companies - 37,528 47,997 - - -L. Profit for the period 8,103,565 5,253,325 2,451,973 3,718,296 3,881,119 2,152,229L.bis Minority interests in profit 404,739 170,661 88,318 61,599 54,945 51,933L.ter Group share of profit 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

TOTAL EXPENSES 9,242,071 6,653,148 4,457,964 4,763,900 5,128,560 4,015,376

Appropriation of profitC. Transfers to / (from) reserves 5,063,466 2,497,984 (188,533) 1,021,337 1,241,494 (451,892)

1. Consolidated reserves 5,063,466 2,497,984 (188,533) 1,021,337 1,241,494 (451,892)F. Profit to be distributed 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188

1. Dividend to shareholders 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188

7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

65



REVENUES (BEF thousand) Consolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995A. Revenue from investments 508,429 575,358 596,138 2,220,810 2,241,655 2,579,858

1. Dividends 497,201 533,414 514,519 2,209,582 2,199,711 2,498,2392. Interests 11,228 41,944 81,619 11,228 41,944 81,619

B. Revenue from current assets 744,684 663,277 652,176 757,465 668,823 653,281C. Other financial revenue 157,318 182,514 95,620 157,318 204,249 95,620D. Revenue from services rendered 40,351 27,679 26,274 40,351 27,679 26,274E. Other operating revenue 53,746 44,338 47,003 53,746 44,338 47,003F. Reversals of depreciation or write-off of tangible

and intangible assets 15,509 16,277 35,137 - - -G. Write-back of 60,576 426,403 53,291 60,576 426,403 53,291

1. long-term investments 39,729 324,441 - 39,729 324,441 -2. current assets 20,847 101,962 53,291 20,847 101,962 53,291

H. Reversals of provisions for liabilities and charges 3,500 - 2,500 3,500 - 2,500I. Profits on disposal of 1,446,251 1,080,054 538,995 1,462,152 1,373,408 538,995

1. tangible and intangible fixed assets 578 108 - 578 108 -2. long-term investments 783,637 849,051 8,489 799,538 1,142,405 8,4893. current assets 662,036 230,895 530,506 662,036 230,895 530,506

J. Exceptional revenue 6 136,238 - 6 136,238 -K. Taxation adjustments and reversals of tax provisions 2,518 5,767 15,436 7,976 5,767 18,554K.bis Profits of equity-accounted companies 6,209,183 3,495,243 2,395,394 - - -L. Loss for the period - - - - - -L.bis Minority interest in loss - - - - - -L.ter Group share of loss - - - - - -

TOTAL REVENUES 9,242,071 6,653,148 4,457,964 4,763,900 5,128,560 4,015,376

Appropriation of profitA. Profit available for appropriation 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

1. Profit for the period 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296

66



ASSETS (BEF thousand)

III. GoodwillThis represents the excess of the cost of investments in subsidiaries and equity-accounted companies over the value of NPM/CNP’s share oftheir net assets on the date of acquisition or initial consolidation and is analysed as follows :

Grossamounts

Cumulativeamortisation

Consolidatednet amounts

au 31.12.1997 au 31.12.1997 1997 1996 1995PETROFINA 2,326,927 (908,424) 1,418,503 1,611,016 1,730,504IJSBOERKE 1,266,420 - 1,266,420 - -ROYALE BELGE 477,096 (211,004) 266,092 331,916 410,202BERNHEIM-COMOFI 82,303 (31,935) 50,368 54,483 58,604SUZY 10,756 (10,756) - - -ACP 786 (786) - 746 -Total 4,164,288 (1,162,905) 3,001,383 1,998,161 2,199,310

Goodwill is allocated to the investments to which it is related and is amortised at a rate of 5 % per annum. Minor amounts can be written offin full ; this was the case in 1997 for an amount of 10,926. Moreover, additional amortisation is provided when appropriate.

V. InvestmentsA.1 Equity-accounted companies – Shares

Percentage of ownership Consolidated accounts1997 1996 1995 1997 1996 1995

PARJOINTCO 50.00 % 50.00 % 50.00 % 22,556,419 18,966,721 17,757,949PETROFINA 6.41 % 6.46 % 6.46 % 9,996,619 9,204,380 8,438,526SCI & ASSOCIÉS - - 49.00 % - - 2,504,777ROYALE BELGE 2.05 % 2.35 % 2.69 % 1,690,103 1,594,055 1,629,577BERNHEIM-COMOFI 21.69 % 21.69 % 21.69 % 965,283 960,140 1,061,437ACP 28.32 % 28.32 % 28.12 % 454,531 408,818 353,496TRANSCOR 47.59 % 47.59 % 47.59 % 777,813 680,941 596,246ÉDITIONS DUPUIS 50.00 % 50.00 % 50.00 % 391,383 380,873 355,625HÉLIO CHARLEROI 25.00 % 25.00 % 25.00 % 112,065 82,236 57,483IJSBOERKE 100.00 % - - 209,554 - -SUZY 100.00 % - - 106,403 - -Others n.a. n.a. n.a. 66,859 71,650 548,862Total 37,327,032 32,349,814 33,303,978

A.2 Equity-accounted companies – Bonds and other amounts receivableConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995SCI & ASSOCIÉS - - 1,772,996 - - -SUZY 200,000 - - - - -HÉLIO CHARLEROI 75,000 75,000 75,000 - - -Total 275,000 75,000 1,847,996 - - -

67



B.1 Other companies – Stocks and shares

(number of shares held) Consolidated accounts Restricted consolidated accounts1997 1996 1995 1997 1996 1995

ACIDE CARBONIQUE PUR - - - 28,316 28,316 28,121ARTEMIS - 299,592 - - 299,592 296,953BERNHEIM-COMOFI - - - 640,606 640,606 640,606COBEPA 877,261 1,165,435 1,165,435 877,261 1,165,435 1,165,435COMPAGNIE GÉNÉRALE DES EAUX 1,115,335 1,115,335 1,115,335 1,115,335 1,115,335 1,115,335ELF AQUITAINE 1,000,000 1,296,695 1,296,695 1,000,000 1,296,695 1,296,695ESPIRITO SANTO FINANCIAL HOLDING - 263,474 2,047,169 - 263,474 2,047,169ÉDITIONS DUPUIS - - - 639,187 639,187 639,187HÉLIO CHARLEROI GROUPE J. DUPUIS - - - 100,000 100,000 100,000HEXANE (L’Éventail) 210 210 - 210 210 -BELHOLDING - - - 216 - -STARCO TIELEN IJSBOERKE Group - - - 7,119 - -IJSBOERKE I.C.I. - - - 14 - -IMMO TIELEN - - - 102 - -PARGESA registered shares - - - 544,694 544,694 544,694PARGESA bearer shares - - - 396,250 396,250 396,250PARIBAS - - 151,514 - - 151,514PETROFINA - - - 1,501,078 1,501,078 1,501,078ROYALE BELGE - - - 328,668 376,263 429,688SCI & ASSOCIÉS - - - - - 52,432,054SOCIÉTÉ GÉNÉRALE DE BELGIQUE 1,680,791 1,689,185 1,689,185 1,680,791 1,689,185 1,689,185SUZY S.A. - - - 64,400 - -DESOBRY SUZY Group - - - 1,250 - -DRIEHOEK - - - 41 - -TRANSCOR - - - 7,439 7,439 7,439

B.2 Other companies – Bonds and other amounts receivableConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995SCI & ASSOCIÉS - - - - - 1,772,996HÉLIO CHARLEROI - - - 75,000 75,000 75,000SUZY - - - 200,000 - -Other amounts receivable 9 6 7 9 6 7Total 9 6 7 275,009 75,006 1,848,003

VIII. Amounts receivable within one yearB. Other receivables


Tax receivables 547,505 543,110 509,341 547,505 543,110 509,341Loans to associated companies 6,583,231 8,329,829 3,025,000 6,393,325 8,199,060 3,025,000Receivables related to shares sold 200,422 302,842 - 200,422 302,842 -Others 13,539 18,941 36,138 13,539 18,941 38,119Total 7,344,697 9,194,722 3,570,479 7,154,791 9,063,953 3,572,460

IX. Short-term investmentsA. Own sharesAt 31 December 1997, the NPM/CNP Group held 411,165 of its own shares for a value of 747,018, with a total nominal value of 77,093.Of these own shares 358,966 were held by NPM/CNP (INVESTOR and CARPAR) and 52,199 by FINGEN, an indirect subsidiary. Thedividends received on these shares have been eliminated from the (restricted) consolidated accounts.

B. Other investments and depositsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Shares and bonds 2,208,609 3,245,024 3,259,746 2,208,609 3,428,163 3,288,482Cash deposits 6,147,709 2,889,394 2,791,211 6,330,319 2,889,394 2,791,211Total 8,356,318 6,134,418 6,050,957 8,538,928 6,317,557 6,079,693

68



LIABILITIES AND EQUITY

I. Share capitalThe Board was authorised by the Shareholders’ Meeting of 12 June 1996 to increase the share capital by 2,000,000 and to issue debentureswith conversion or subscription rights which could lead to an increase in the share capital of the same amount. The capital increase by318,750 following the exercise of the warrants currently in issue would be deducted from the authorised capital. The Shareholders’ Meetingof 11 June 1997 authorised the Board of Directors to acquire on the stock market up to 1,500,000 own shares.

IV. ReservesThis records NPM/CNP’s share of profits transferred to reserves by NPM/CNP, its subsidiaries and equity-accounted companies.Movements on the reserve were as follows :


Opening balance 8,627,375 6,129,391 6,317,924 4,945,187 3,703,693 4,155,585

Profit of the year 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296Dividends (2,635,360) (2,584,680) (2,552,188) (2,635,360) (2,584,680) (2,552,188)Change in accounting principles byPETROFINA (583,424) - - - - -Closing balance 13,107,417 8,627,375 6,129,391 5,966,524 4,945,187 3,703,693

V. Negative goodwillNegative goodwill is the difference between the cost of investments in subsidiaries and equity-accounted companies and the value ofNPM/CNP’s share of the equity of these companies at the date of their acquisition or first consolidation.

VI. Translation adjustmentsThese adjustments are the result of movements in the exchange rates of currencies in which the accounts of subsidiaries orequity-accounted companies are expressed. They represent the difference between the value on translation of the assets and liabilities offoreign subsidiaries at the closing rate and their net worth at historic rates as well as the difference arising from the balance sheet beingtranslated at the closing rate while the income statement is translated at the average rate for the year. The differences shown mainly relateto PETROFINA.

VIII. Minority interestsThe minority interests represent 10.5 % of the capital of AGESCA NEDERLAND held by FRÈRE-BOURGEOIS.

IX. Provisions for liabilities and chargesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Potential compensation to FIBELPAR in caseof exercise by ELF AQUITAINE of its putoption on NPM/CNP-shares (provisionreversed in 1996) - - 136,000 - - 136,000FRF exchange hedging costs (liquidationJanuary 1996) - - 126,840 - - 126,840Provisions for COMPAGNIE GÉNÉRALEDES EAUX put options - - 6,410 - - 6,410VITAL SOGEVIANDES potential losses - - 34,107 - - -Removal costs - 20,000 - - 20,000 -Others 38,000 21,500 - 38,000 21,500 -Total 38,000 41,500 303,357 38,000 41,500 269,250

69



X. Amounts payable after more than one yearConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Bonds A (1) 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000Bonds B (2) 1,773,750 1,773,750 1,773,750 1,773,750 1,773,750 1,773,75050 % Group’s share in PARJOINTCO’sborrowing of CHF 18,500,000 (ended14.07.1999 – 4.875 % rate) - - - 234,918 219,282 236,561Total 3,273,750 3,273,750 3,273,750 3,508,668 3,493,032 3,510,311

(1) 30,000 bonds A 6.70 % 1994-1999 each with a nominal value of BEF 50,000(2) 750,000 bonds B 5.0625 % 1994-1999 each with a nominal value of BEF 2,365 and with 2 warrants attached which can be exercised from 1 to 15 June 1994

to 1999 at BEF 2,365 per share

XI. Amounts payable within one yearB. Financial debts


Market rate loans from affiliated companies 4,562,500 6,200,265 2,900,000 4,562,500 6,201,938 2,900,000Foreign currency credits covering short-terminvestments 1,692,793 1,462,116 1,330,973 1,692,793 1,462,116 1,330,973Others 5 - 7,150 5 - 7,150Total 6,255,298 7,662,381 4,238,123 6,255,298 7,664,054 4,238,123

F. Other liabilitiesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Dividends for the year 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188Dividends relating to prior years 8,394 6,398 6,150 8,394 6,398 6,150Liabilities related to share purchases 69,816 315,930 255,625 42,975 315,930 255,625Others 36,100 5,892 9,154 36,100 5,892 9,149Total 2,749,670 2,912,900 2,823,117 2,722,829 2,912,900 2,823,112

RECONCILIATION OF BALANCE SHEET AT 31.12.1997 (RESTRICTED CONSOLIDATED ACCOUNTS - CONSOLIDATED ACCOUNTS)

Other companiesstock and shares

Other assetsand liabilities

GoodwillPositive Negative Consolidated

reservesTranslationadjustments

Minorityinterests

Equity-accounted

companies :shares

Restricted consolidatedaccounts 44,834,836 204,251 - 149,459 5,966,524 (89,465) 1,696,087 -

Equity-accounted companies :

PARJOINTCO/PARGESA (1) (15,535,950) (231,092) - - 6,573,280 (133,401) 811,682 22,556,419ACP (579,679) - - 2,760 (128,077) 169 - 454,531BERNHEIM-COMOFI (920,793) - 50,368 337 93,601 920 - 965,283ÉDITIONS DUPUIS (300,565) - - 21,030 69,788 - - 391,383HÉLIO CHARLEROI (25,220) - - 9,328 77,517 - - 112,065IJSBOERKE (1,449,132) 26,841 1,266,419 - - - 209,554PETROFINA (13,718,132) - 1,418,504 - (412,442) (1,890,567) - 9,996,619ROYALE BELGE (1,521,339) - 266,092 - 434,626 230 - 1,690,103SUZY (76,987) - - - 29,416 - - 106,403TRANSCOR (325,521) - - 31,720 390,647 29,925 - 777,813Others (54,322) - - - 12,537 - - 66,859

Effect of equity accounting (34,507,640) (204,251) 3,001,383 65,175 7,140,893 (1,992,724) 811,682 37,327,032

Consolidated accounts 10,327,196 - 3,001,383 214,634 13,107,417 (2,082,189) 2,507,769 37,327,032

(1) Relates to PARGESA shares held, in the restricted consolidation, by PARJOINTCO.

70


ANALYTICAL PROFIT AND LOSS STATEMENTS

(BEF thousand) Consolidated accounts Restricted consolidated accountsNote 1997 1996 1995 1997 1996 1995

Revenue from long-term investments 4,226,935 3,621,363 3,208,863 2,220,810 2,241,655 2,163,251Dividends 1 497,201 533,414 514,519 2,209,582 2,199,711 2,081,632Interests 2 11,228 41,944 81,619 11,228 41,944 81,619Operating income - in profitfrom equity-accounted companies - in loss

33

3,718,506-

3,083,533(37,528)

2,614,877(2,152)

--

--

--

Other financial income and expenses 890,522 558,983 601,331 858,284 573,284 585,621Revenue from current assets 744,684 663,277 652,176 757,465 668,823 653,281Interest expense (402,002) (444,711) (465,452) (420,794) (456,316) (475,140)Profits on disposal of current assets 662,036 230,895 530,506 662,036 230,895 530,506Losses on disposal of current assets (42) (16,280) (13,479) (42) (16,280) (13,479)Write-down on current assets (127,427) (3,133) (147,004) (127,427) (3,133) (147,004)Write-back on current assets 20,847 101,962 53,291 20,847 101,962 53,291Other financial revenue 157,318 182,514 95,620 157,318 204,249 95,620Other financial expense (164,892) (155,541) (104,327) (191,119) (156,916) (111,454)

Net overheads (108,187) (103,859) (90,659) (126,086) (120,889) (96,590)Miscellaneous goods and services (89,367) (86,086) (70,428) (90,758) (86,086) (72,220)Payroll expenses (89,274) (79,538) (79,369) (105,745) (96,522) (83,452)Depreciation (17,021) (3,003) (5,867) (17,058) (3,049) (5,923)Provisions for liabilities and charges 3,500 - (3,910) 3,500 - (3,910)Miscellaneous operating expenses (10,122) (7,249) (4,362) (10,122) (7,249) (4,362)Revenue from services rendered 40,351 27,679 26,274 40,351 27,679 26,274Other operating revenue 53,746 44,338 47,003 53,746 44,338 47,003

Taxes on operating income (46,765) (15,952) (14,355) (41,307) (22,703) (11,237)

Minority interests (141,868) (125,074) (100,824) (61,599) (54,945) (51,933)

Operating income (Group share) 8 4,820,637 3,935,461 3,604,356 2,850,102 2,616,402 2,589,112In BEF/share 190.24 155.31 142.24 112.47 103.25 102.17

Revenue from long-term investments 2,490,677 411,710 (265,328) - - 416,607Exceptional dividends - - - - - 416,607Capital results - in profitfrom equity-accounted companies - in loss

44

2,490,677-

411,710-

-(265,328)

--

--

--

Operations on long-term investments 823,366 924,162 (551,851) 839,267 1,217,516 (589,678)Profits on disposals 5 783,637 849,051 8,489 799,538 1,142,405 8,489Losses on disposals - - (3,937) - - (3,937)Write-down on long-term investments 6 - (249,330) (556,403) - (249,330) (594,230)Write-back on long-term investments 6 39,729 324,441 - 39,729 324,441 -

Goodwill amortisation (140,311) (136,159) (120,283) - (821) -Amortisation (155,820) (152,436) (155,420) - (821) -Reversals 15,509 16,277 35,137 - - -

Other capital results (32,672) 30,577 (315,745) (32,672) 30,577 (315,745)Profits on disposal of tangible assets 578 108 - 578 108 -Losses on disposal of tangible assets (88) (15) (293) (88) (15) (293)Exceptional revenue 7 6 136,238 - 6 136,238 -Exceptional expenses 7 (33,168) (105,754) (315,452) (33,168) (105,754) (315,452)

Taxes on capital results - (37,500) - - (37,500) -

Minority interests (262,871) (45,587) 12,506 - - -

Capital results (Group share) 8 2,878,189 1,147,203 (1,240,701) 806,595 1,209,772 (488,816)In BEF/share 113.58 45.27 (48.96) 31.83 47.74 (19.29)

Net profit (Group share) 8 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296In BEF/share 303.82 200.58 93.28 144.31 150.99 82.88

71



Note 1 — Revenue from long-term investments – DividendsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ACP - - - 28,316 - -BERNHEIM-COMOFI - - - 64,061 64,061 60,394COBEPA 86,945 62,160 58,026 86,945 62,160 58,026COMPAGNIE GÉNÉRALE DES EAUX 92,820 97,330 93,908 92,820 97,330 93,908ÉDITIONS DUPUIS - - - 37,561 12,000 21,068ELF AQUITAINE 116,829 130,470 127,117 116,829 130,470 127,117ESPIRITO SANTO FINANCIAL HOLDING 5,622 32,260 42,076 5,622 32,260 42,076PARGESA - - - 787,383 790,283 771,914PETROFINA - - - 600,431 528,379 480,345ROYALE BELGE - - - 118,328 97,828 110,279SCI & ASSOCIÉS - - - - 149,768 -SOCIÉTÉ GÉNÉRALE DE BELGIQUE 194,972 195,945 193,377 194,972 195,945 193,377TRANSCOR - - - 69,149 23,978 114,423Others 13 15,249 15 7,165 15,249 8,705Total 497,201 533,414 514,519 2,209,582 2,199,711 2,081,632

Note 2 — Revenue from long-term investments – InterestsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995HÉLIO CHARLEROI 5,156 7,800 7,800 5,156 7,800 7,800SUZY 6,072 - - 6,072 - -SCI & ASSOCIÉS - 34,144 73,819 - 34,144 73,819Total 11,228 41,944 81,619 11,228 41,944 81,619

Note 3 — Operating income from equity-accounted companiesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ACP 72,699 52,969 33,202 - - -BERNHEIM-COMOFI 68,774 (37,528) 89,695 - - -ÉDITIONS DUPUIS 49,169 37,806 31,851 - - -HÉLIO CHARLEROI 41,772 20,298 12,376 - - -PARJOINTCO (1) 1,510,247 1,451,384 1,304,519 - - -PETROFINA 1,413,897 1,021,124 735,012 - - -ROYALE BELGE (2) 416,250 264,552 178,350 - - -SCI & ASSOCIÉS - 149,768 204,569 - - -SUZY 40,172 - - - - -TRANSCOR 103,163 82,600 21,624 - - -Others 2,363 3,032 1,527 - - -Total - in profit

- in loss3,718,506

-3,083,533

(37,528)2,614,877

(2,152)--

--

--

- globally 3,718,506 3,046,005 2,612,725

(1) including profits made by ROYALE BELGE on the BBL/ING exchange in 1997 for an amount of 209,569 (187,652 Group share) and on TRACTEBEL in 1996 for anamount of 82,054 (73,473 Group share)

(2) including profits made on the BBL/ING exchange in 1997 for an amount of 234,287 and on TRACTEBEL in 1996 for an amount of 98,700

Note 4 — Capital results from equity-accounted companiesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995PARJOINTCO 2,490,677 411,710 (219,483) - - -Others - - (45,845) - - -Total - in profit

- in loss2,490,677

-411,710

--

(265,328)--

--

--

- globally 2,490,677 411,710 (265,328)

72



Note 5 — Operations on long-term investments – Profits on disposalsConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ELF AQUITAINE 399,007 - - 399,007 - -COBEPA 149,706 - - 149,706 - -ROYALE BELGE 112,431 85,334 - 135,751 91,647 -ESPIRITO SANTO FINANCIAL HOLDING 49,996 - - 49,996 - -SCI & ASSOCIÉS 48,992 755,793 - 48,892 1,050,758 -Others 23,505 7,924 8,489 16,186 - 8,489Total 783,637 849,051 8,489 799,538 1,142,405 8,489

Note 6 — Operations on long-term investments – Write-down and write-backConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995ARTEMIS - (249,330) (43,639) - (249,330) (81,466)ESPIRITO SANTO FINANCIAL HOLDING 39,729 259,301 (308,687) 39,729 259,301 (308,687)COMPAGNIE FINANCIÈRE DE PARIBAS - 65,140 (194,077) - 65,140 (194,077)Others - - (10,000) - - (10,000)Total write-down

write-back-

39,729(249,330)324,441

(556,403)-

-39,729

(249,330)324,441

(594,230)-

Note 7 — Exceptional revenue and expensesConsolidated accounts Restricted consolidated accounts

1997 1996 1995 1997 1996 1995Provision for potential compensation to FIBELPARin case of exercise by ELF AQUITAINE of its putoption on NPM/CNP shares - 136,000 (136,000) - 136,000 (136,000)Exchange hedging on FRF debt - - (179,078) - - (179,078)Provision for removal costs - (20,000) - - (20,000) -Costs relating to the new premises - (56,576) - - (56,576) -Other expenses (33,168) (29,178) - (33,168) (29,178) -Other revenues 6 238 - 6 238 -Total revenue

expenses6

(33,168)136,238

(105,754)-

(315,452)6

(33,168)136,238

(105,754)-

(315,452)

Note 8 — Reconciliation of the consolidated profit and the restricted consolidated profit (Group share)

OPERATING CAPITAL TOTAL

Direct contribution


Results ofequity

accountedcompanies Dividend

Consoli-dated


Results ofequity

accountedcompanies Others

Amorti-sation ofgoodwill

Consoli-dated

Consoli-dated

PARGESA 705,039 1,392,314 (705,039) 1,392,314 - 2,559,052 - (314,961) 2,244,091 3,636,405ACP 28,316 72,699 (28,316) 72,699 - - - (746) (746) 71,953BERNHEIM-COMOFI 64,061 68,774 (64,061) 68,774 - - - (4,115) (4,115) 64,659ÉDITIONS DUPUIS 37,561 49,169 (37,561) 49,169 - - - - - 49,169HÉLIO CHARLEROI 5,156 41,772 - 46,928 - - - - - 46,928PETROFINA 600,431 1,413,897 (600,431) 1,413,897 - - - (116,346) (116,346) 1,297,551ROYALE BELGE 118,328 416,250 (118,328) 416,250 - - - (23,857) (23,857) 392,393SUZY 6,072 40,172 - 46,244 - - - (10,756) (10,756) 35,488TRANSCOR 69,149 103,163 (69,149) 103,163 - - - - - 103,163Others 1,215,989 2,363 (7,153) 1,211,199 806,595 - (16,677) - 789,918 2,001,117Total 2,850,102 3,600,573 (1,630,038) 4,820,637 806,595 2,559,052 (16,677) (470,781) 2,878,189 7,698,826in BEF per share 112.47 190.24 31.83 113.58 303.82

73


APPENDIX

I. Principles, Group structure and methods of consolidation

In addition to the consolidated accounts required by the Royal Decrees of 6 March 1990 and 25 November 1991,the Company also publishes restricted consolidated accounts.

The latter fully consolidate the results of the parent company and those of fully owned financial companies (seelist at point II below), AGESCA NEDERLAND (89.54 % held) and its subsidiary N.F. ASSOCIATES, andproportionally consolidate CENTRE DE COORDINATION DE CHARLEROI, GROUPE JEAN DUPUIS andPARJOINTCO, which are jointly controlled.

These restricted consolidated accounts are published for information purposes only ; as they have no statutorynature, no further details are provided in this Appendix.

The consolidated accounts which are analysed in this appendix fully consolidate the accounts of the parentcompany and those of its subsidiaries in which there is a shareholding of 100 %, of AGESCA NEDERLAND andof N.F. ASSOCIATES, proportionally consolidate CENTRE DE COORDINATION DE CHARLEROI andGROUPE JEAN DUPUIS and consolidate by the equity method the accounts of companies in which there is ashareholding, directly or indirectly, of at least 20 %, as well as those of PARJOINTCO, which is jointly controlled.

This accounting treatment is intended to better reflect the true picture of the assets of the NPM/CNP Group, withPARJOINTCO fully consolidating PARGESA, GBL and PARFINANCE Groups.

In order to give shareholders a more complete picture of the Group, a summary presentation of the consolidatedaccounts of PARJOINTCO (i.e. including the PARGESA Group) is included (see pages 84 to 89).

74


APPENDIX

The Group structure at 31 December 1997 can be presented as follows :

(1) Agreement between the FRÈRE-BOURGEOIS and NPM/CNP Groups providing equal management control(2) Company jointly held with POWER CORPORATION OF CANADA(3) CLT-UFA HOLDING, 50 % jointly held, owns 98 % of CLT-UFA(4) Shares acquired at the end of the year have not contributed to the 1997 profit

ACP

SUZY

IJSBOERKE

ÉDITIONS DUPUIS

HÉLIO CHARLEROI

PETROFINA

TRANSCOR

ROYALE BELGE

BERNHEIM-COMOFI

NPM / CNPand consolidated financial holdings

PARJOINTCO (2)

AGESCA NEDERLAND N.F. ASSOCIATES

ERBE GROUP

FIBELPAR GROUP

GBLand consolidatedfinancial holdings

40.7 % PARFINANCE

48.9 % balance sheet48.2 % P&L (4)

PARGESAHOLDING 45.8 %

20.4 %

2.1 %

47.6 %

22.7 %

40.5 %

83.1 %

54.4 %

25.6 %

100.0 %

54.5 %Equity

62.1 %Votes

Restricted consolidation

Consolidation

89.5 %Equity

joint control(1)

10.5 %Equity

Jointcontrol (1)

49.0 %

50.0 %

38.0 %

IMÉTAL

ORIOR

COMETRA

MONUMENT OIL & GAS

CLT-UFA (3)

BELGIAN SKY SHOPS

DEWAAY

57.1 %

53.5 %

54.5 %

GROUPE JEAN DUPUIS

50.0 %

50.0 %

50.0 %

6.4 %

100.0 %

47.6 %

21.7 %

50.0 %

FRÈRE-BOURGEOIS GROUP

12.9 %

28.3 %

100.0 % B/S 0,0 %P&L (4)

100.0 %

75


APPENDIX

II. Fully consolidated subsidiaries Nationalidentification Percentage of shares held by

orVAT number



AGESCA NEDERLAND N.V. - Rotterdam - 89.5 -CARPAR S.A. - Loverval 441.649.215 100.0 -COMPAGNIE IMMOBILIÈRE DE ROUMONT S.A. - Loverval 455.738.167 100.0 -FINGEN S.A. - Luxembourg - 100.0 -INVESTOR S.A. - Loverval 426.114.070 100.0 -N.F. ASSOCIATES N.V. - Rotterdam - 100.0 (1) -ORILUX S.A. - Luxembourg - 100.0 -SLP S.A. - Loverval 429.364.758 100.0 -SWIFIN S.A. - Luxembourg - 100.0 -SWILUX S.A. - Luxembourg - 100.0 -

(1) 100 % of the ordinary equity is held by AGESCA NEDERLAND N.V.

III. Proportionally consolidated subsidiaries Nationalidentification Percentage of shares held by

orVAT number



CENTRE DE COORDINATION DE CHARLEROI S.A.Loverval

454.199.332 50.0 20.9

GROUPE JEAN DUPUIS S.A. - Loverval 405.630.244 50.0 50.0

IV. Major equity-accounted companies Nationalidentification Percentage of shares held by

orVAT number



ACIDE CARBONIQUE PUR S.A. - Brussels 402.117.062 28.3 -BERNHEIM-COMOFI S.A. - Brussels 403.231.968 21.7 60.9ÉDITIONS DUPUIS S.A. - Marcinelle 429.160.563 100.0 (1) -ELECTRAFINA S.A. - Brussels 407.040.209 - 48.4GROUPE BRUXELLES LAMBERT S.A. - Brussels 403.228.010 - 48.9HÉLIO CHARLEROI S.A. - Fleurus 434.915.138 50.0 (1) -IJSBOERKE ICE CREAM INTERNATIONAL N.V. - Tielen 438.625.684 100.0 -PARFINANCE S.A. - Paris - - 86.5PARGESA HOLDING S.A. - Geneva - - 54.5PARJOINTCO N.V. - Rotterdam - 50.0 -PETROFINA S.A. - Brussels 403.079.441 6.4 22.7ROYALE BELGE S.A. - Brussels 403.292.346 2.1 12.9 (2)ROYALE VENDÔME S.A. - Brussels 432.525.869 - 25.1SUZY N.V. - Buizingen 417.942.811 100.0 -TRANSCOR S.A. - Brussels 402.981.550 47.6 47.6

(1) investment held by GROUPE JEAN DUPUIS (2) 51.2 % held by ROYALE VENDÔME

V. Other companies in which there is a shareholdingof at least 10 %

Nationalidentification Percentage of shares held by

orVAT number



HEXANE S.A. - Brussels 451.175.506 50.0 (1) - (1) investment held by GROUPE JEAN DUPUIS, which is not equity-accounted due to its minor importance.

For the sake of the clarity and conciseness necessary to give a good overall view of the Group, the above lists are notexhaustive.

Subsidiaries controlled by companies included under point IV have been omitted, as they are considered as economicallybeing an integral part of these companies. Also excluded were the entities or Groups in which the companies includedunder point II do not have any direct shareholding or which are not part of a chain leading to a shareholding accounted forunder the equity method.

Complete details are available at the Company’s Registered Office and will be filed with the NATIONAL BANK OFBELGIUM together with the consolidated accounts.

76


APPENDIX

VI. Accounting policies

The accounting policies applied in the preparation of the consolidated accounts are the same as those which apply to thestatutory accounts (cf. point XX of the Appendix to the annual accounts). As allowed by the Royal Decree of 6 March 1990,financial statements of equity-accounted companies or groups have not been restated, except where the accountingpolicies applied in these accounts are incompatible with those laid down by Belgian law and European Directives.

� Intercompany balances are eliminated ; the Group’s share of intercompany profits earned from both subsidiaries andequity-accounted companies is eliminated.

� The assets and liabilities of foreign companies are translated using the closing rate method ; the income statements ofthese companies are converted at the average rate for the year as published by the NATIONAL BANK OF BELGIUM.

� Goodwill is the difference on consolidation calculated when a company is included in the consolidation for the first time.For those companies falling within the restricted consolidation, where positive goodwill arises, it is as far as possibleallocated to the individual assets which justified the payment of the premium. If no such allocation can be made it isfully written off in the year in which it arises.

Positive goodwill on equity-accounted companies is amortised at 5 % per annum. The Board of Directors believes thatamortising goodwill over 20 years corresponds more closely to economic reality (goodwill is paid in the expectation offuture profits) rather than the 5 year limit suggested by the Royal Decree. Minor amounts may be written off in full.Extraordinary amortisation is made when the Board considers that the goodwill is overstated.

Negative goodwill is reported as a component of the shareholders’ equity and remains there for as long as the shares towhich it relates stay within the Group.

VII. Statement of formation expenses (BEF thousand)



VIII. Statement of intangible assets (BEF thousand)



IX. Statement of tangible fixed assets (BEF thousand)

Lands andbuildings

Furniture andvehicles

Assets underconstruction

Other tangibleassets

a) Acquisition costOpening balance 20,541 45,615 182,622 -Movement in the year- acquisitions 27,905 84,718 31,024 -- disposals - (4,273) (213,646) 213,646Closing balance 48,446 126,060 - 213,646

c) DepreciationOpening balance - (28,292) - -Movement in the year- charged - (11,837) - (5,184)- written back - 3,318 - -Closing balance - (36,811) - (5,184)

Closing net book value 48,446 89,249 - 208,462

77


APPENDIX

X. Statement of investments (BEF thousand)

Companiesequity-accounted other

1. Shareholdingsa) Acquisition cost

Opening balance 33,201,723 12,113,038Movements in the year- acquisitions 1,526,119 -- disposals and withdrawals (220,202) (1,720,899)- transfer between items - -

Closing balance 34,507,640 10,392,139b) Revaluation surplus

Opening balance - -Movements in the year- revaluations - -- cancellations - -

Closing balance - -c) Amounts written-off

Opening balance - (364,896)Movements in the year- charged - -- written back - 39,729- transfer between items - 261,104

Closing balance - (64,063)

d) Increases or reductions resulting from consolidationunder the equity methodOpening balance (851,909) -Movements in the year- acquisitions (1,250,334) -- profits 6,209,183 -- dividends received (1,716,720) -- disposals 18,648 -- other 410,524 -

Closing balance 2,819,392 -e) Amounts not called

Opening balance - (880)Movements in the year - -

Closing balance - (880)

Closing net book value 37,327,032 10,327,196

2. Bonds and amounts receivableOpening net book value 75,000 6

Movements in the year- additions 200,000 3- repayments or disposals - -- amounts written off - -

Closing net book value 275,000 9Cumulative write-offs on receivables at the end of thefinancial year - -

78


APPENDIX

XI. Statement of reserves (BEF thousand)

Opening net book value 8,627,375Movements in the year- profit 7,698,826- dividends paid (2,635,360)- changes in accounting principles by PETROFINA (583,424)

Closing net book value 13,107,417

XII. Statement of goodwill (BEF thousand)

Subsidiaries Equity-accounted companiespositive negative positive negative

Opening net book value - 149,459 1,998,161 76,570Movements in the year- adjustments resulting from an increase

in shareholding percentage - - 1,277,176 -- adjustments resulting from a decrease

in shareholding percentage - - (118,134) -- amortisation - - (155,820) -- differences taken to results - - - -- others - - - (11,395)

Closing net book value - 149,459 3,001,383 65,175

XIII. Statement of liabilities (BEF thousand)

due within one year(current portion)

with more than oneyear but less thanfive years to run

with more thanfive years to run

A. Analysis of amounts originally payable aftermore than one yearFinancial liabilities - 3,273,750 -2. Non-subordinated debentures - 3,273,750 -

1997C. Taxes, salaries and social charges payable

1. Taxesb) not overdue tax payablec) accrued tax charges

2. Salaries and social chargesb) other salaries and social charges

80,12450,132

5,490

79


APPENDIX

XIV. Other information regarding operating results (BEF thousand)

1997 1996 1995B.1. Average number of employees

Additional Personnel (12.1 in 1997, 20.1 in 1996 and 20.7 in1995) is included in the records of the NPM/CNP CostAssociation ; it is then allocated among the members at theend of the year.

18.6 10.7 10.2

B.2. Payroll expenses 89,274 79,538 79,369a) salaries and direct social charges 64,466 58,442 58,270b) employers’ social insurance contributions 16,317 13,519 13,442c) employers’ additional insurance contributions 5,537 (1) 3,498 3,596d) other employment costs 2,954 4,079 4,061

D. Taxes on results1. Taxes on the profit for the year 45,677 59,219 24,697

a) taxes and withholdings paid or payable 282,332 262,909 261,551b) payment of taxes or withholdings included

in the balance sheet (282,332) (262,909) (261,551)c) estimated additional taxes 45,677 59,219 24,697

2. Taxes on the profits for previous years 3,606 - 5,094(1) in addition, an exceptional charge regarding pension expenses of 25,000 was booked in 1997

XV. Off-balance sheet rights and commitments

1. Within the framework of the 1990 agreement - renewed in 1996 - between the FRÈRE-BOURGEOIS/NPM-CNP andPOWER Groups with respect to the joint control of PARGESA HOLDING S.A., the partners acknowledged the followingmutual rights and commitments :

in the case of the loss of control by the FRÈRE-BOURGEOIS/NPM-CNP Group or by the POWER Group ofPARJOINTCO N.V. or, should that company be dissolved, of the companies to which ownership of the PARGESAshares will be transferred, subject to settlement by arbitration, the defaulting Group will grant an option to the otherGroup to acquire the shareholding in PARGESA held by PARJOINTCO N.V. or by companies of the defaulting Group, atthe stock market price at the time of the arbitration settlement for PARGESA shares and at the issue price for any otherPARGESA security.

2. As part of the agreement for the sale of SCI & ASSOCIÉS and its subsidiary CACAO BARRY, NPM/CNP had to grantthe acquirer the usual guarantees concerning the sale of enterprises (mainly a guarantee covering assets and liabilitiesvalid until 31 December 1997 or up to the statutory requirement in force on fiscal and social matters, including adeductible). In early January 1998, the Company received from the acquirer, in violation of the contractual terms (thisviolation has been confirmed by the advisors of the Company), notification of elements (for a sum well below thedeductible) which could give rise to a subsequent call on the guarantee in the event that other items (as yet unknown)were to follow suit, possibly crossing the threshold of the said deductible. As the Company did not know any elementlikely to trigger the guarantee at the time this document went to press, no provision was set aside to cover this potentialrisk.

3. In order to cover the exchange risk associated with its ELF AQUITAINE shares, in 1994 the NPM/CNP Group made aBEF/FRF interest rate swap for a period of five years for a sum of FRF 514 million. This operation provided the Groupwith the benefit, in addition to covering the exchange risk, of a favourable interest rate differential of 0.5% per annum forthe duration of the contract. Since the term of the contract extends beyond the date for setting the Euro exchange rates,the conversion difference (favourable or otherwise) appearing on this date on the loan portion of the swap will be carriedforward, on 31 December 1998, to the value of the shares covered by this operation. In order to cover the exchangerisk related to the ELF AQUITAINE shares, the NPM/CNP Group carried out a BEF/FRF exchange rate and interest rateswap for a period of 5 years covering some FRF 514 million.

Despite the sale of part of its holding in ELF AQUITAINE during 1997, the amount of this cover remained well below thevalue of the stock in our possession due to the significant rise in its value.

4. At 31 December 1997, 1,700,000 NPM/CNP warrants were still in circulation, giving the right to subscribe for the samenumber of shares in the company up to 1999 on the following conditions :

- 1,500,000 shares at a price of BEF 2,365 (warrants issued in 1994)- 200,000 shares reserved for the personnel at a price of BEF 1,696 (warrants issued in 1990)

80


APPENDIX

XVI. Intercompany balances with associated and related companies (BEF thousand)

Associated companies Related companies1997 1996 1995 1997 1996 1995

1. Investments- shares 25,185,779 21,142,561 18,239,675 10,451,150 9,613,198 15,064,303- receivables 275,000 75,000 75,000 - - 1,772,996

2. Receivables- due within one year 6,783,658 8,329,629 3,025,000 - - -

3. Short-term investments- shares 489,063 - - 297,600 - -- receivables - - - - - -

4. Payables- falling due beyond one year - - - - - -- long-term liabilities due within

one year - - - - - -- due within one year 4,562,500 6,200,265 3,062,105 - 303,353 93,413

7. Finance income/expense- Income

- from investments 11,228 7,800 - - 34,144 81,619- from current assets 236,060 272,074 121,812 18,962 - -- other financial income - - - - - -

- Expenses- on payables 124,257 154,435 156,989 120 - -- other financial costs - - - - - -

XVII. Financial relations with Directors (BEF thousand)

1997 1996 1995A. Amounts of remuneration paid during the year to

Members of the Board of Directors of the parentcompany by fully or proportionally consolidatedcompanies 24,503 24,279 19,985

B. Loans and advances granted to Directors - - -

81


STATEMENTS OF CASH FLOWS

(BEF thousand) Consolidated accounts Restricted consolidated accountsSOURCES OF LONG-TERM FUNDS 1997 1996 1995 1997 1996 1995Cash flow of the year 8,324,248 4,972,967 3,473,863 3,798,705 3,483,299 3,091,719

Net profit (Group) 7,698,826 5,082,664 2,363,655 3,656,697 3,826,174 2,100,296(Minority interests) 404,739 170,661 88,318 61,599 54,945 51,933

Depreciation and net write-offs 224,183 (18,501) 776,640 83,909 (170,070) 694,240Provisions for liabilities and charges (3,500) (261,857) 245,250 (3,500) (227,750) 245,250

Other changes in equity 265,736 462,079 (267,780) (7,733) (3,479) 75,262Other changes in minority interests 32,793 260,554 (50,916) (4,534) 241,000 (52,963)Long-term debt - - - 15,636 (17,279) 236,561

8,622,777 5,695,600 3,155,167 3,802,074 3,703,541 3,350,579

APPLICATIONS OF LONG-TERM FUNDSDividends paid 2,635,360 2,584,680 2,552,188 2,635,360 2,584,680 2,552,188Tangible assets 142,692 146,752 68,778 142,692 146,752 68,778Long-term investments (including goodwill) 5,074,119 (3,455,475) (277,075) 46,125 (5,415,296) (297,501)

7,852,171 (724,043) 2,343,891 2,824,177 (2,683,864) 2,323,465

Net increase/(decrease) in long-term funds 770,606 6,419,643 811,276 977,897 6,387,405 1,027,114

CHANGES IN WORKING CAPITAL

Increase/(decrease) in current assetsTrade receivables within one year 37,366 (22) 7,045 37,366 (22) 7,045Other amounts receivable within one year (1,850,025) 5,624,243 180,348 (1,909,162) 5,491,493 267,414Short-term investments - own shares (125,077) 872,095 - (125,077) 872,095 -Short-term investments - other investments and deposits 2,115,320 (15,368) (1,477,827) 2,327,951 139,035 (1,449,105)Cash at bank and in hand (936,735) 3,528,516 1,924,711 (920,345) 3,486,781 1,944,159Deferred charges and accrued income 196,233 (66,667) 40,246 199,881 (65,896) 40,001

(562,918) 9,942,797 674,523 (389,386) 9,923,486 809,514

Increase/(decrease) in current liabilitiesTransfers from long-term debt - - (20,000) - - (20,000)Financial liabilities (1,407,083) 3,424,258 (383,180) (1,408,756) 3,425,931 (468,265)Trade payables (8,980) 23,266 23,046 (8,980) 23,266 23,046Taxes, salaries and social charges payable 21,576 60,384 (19,121) 18,352 63,608 (20,782)Other amounts payable within one year (163,230) 89,783 331,031 (190,071) 89,788 331,026Accrued charges and deferred income 224,193 (74,537) (68,529) 222,172 (66,512) (62,625)

(1,333,524) 3,523,154 (136,753) (1,367,283) 3,536,081 (217,600)

Increase/(decrease) in working capital 770,606 6,419,643 811,276 977,897 6,387,405 1,027,114

82


STATEMENTS OF CASH FLOWS - COMMENTS

After a 1995 financial year with little movement in the portfolio, NPM/CNP disposed of the followingshareholdings in 1996 and 1997 :

- ROYALE BELGE53,425 shares in 1996 (for an amount of BEF 339 million) and 47,575 shares in 1997 (BEF 356 million).

- ESPIRITO SANTO FINANCIAL HOLDING1,783,695 shares in 1997 (for an amount of BEF 1,128 million) and 263,474 shares in 1997(BEF 199 million).

- COBEPA 288,174 shares in 1997 for an amount of BEF 431 million.

- ELF AQUITAINE296,695 shares in 1997 for an amount of BEF 1,132 million.

- SCI & ASSOCIÉSThe whole shareholding mid-1996 for an amount of BEF 5,056 million.

Shareholdings meant to be sold have been classified as short-term investments : PARIBAS end 1996(BEF 244 million) and ARTEMIS end 1997 (BEF 205 million).

In 1997, NPM/CNP acquired 100 % of SUZY (BEF 77 million for the shares and BEF 200 million forlong-term advances) and of IJSBOERKE (BEF 1,449 million).

83


AUDITORS’ REPORT

Ladies, Gentlemen,

In accordance with the legal and statutory requirements, we report on our audit assignmentwhich you have entrusted to us.

We have examined the consolidated annual accounts for the year ended 31 December1997, which have been prepared under the responsibility of the Board of Directors andwhich show a balance sheet total of BEF 74,285,102 (000) and an income statementresulting in a profit, for the year of BEF 7,698,826 (000) (Group share). In addition, wehave performed specific procedures with respect to the Directors’ report.

Unqualified audit opinion on the financial statementsOur examination has been conducted in accordance with the auditing standards of theINSTITUT DES REVISEURS D’ENTREPRISE / INSTITUUT DER BEDRIJFSREVISOREN.Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the consolidated annual accounts are free of materialmisstatement and are in compliance with the Belgian legal and regulatory requirements.

In accordance with these standards we have taken into account the administrative andaccounting organisation of the Company as well as the procedures of internal control. Theresponsible officers of the company have clearly replied to all our requests for informationand explanations. We have examined, on a test basis, the evidence supporting theamounts included in the consolidated financial statements. We have assessed theaccounting policies used, the significant estimates made by the Company and the overallpresentation of the consolidated annual accounts. We believe that our audit provides areasonable basis for our opinion.

In our opinion, the consolidated annual accounts present fairly the financial position ofNPM/CNP as of 31 December 1997, and the results of its operations for the year thenended taking into account the legal and regulatory requirements, and the supplementaryinformation given in the notes is adequate.

Additional certificationsWe supplement our report with the following certifications which do not impact on our auditopinion on the financial statements :

- The Directors’ report includes the information required by the law and is in accordancewith the consolidated financial statements.

Brussels, 3 April 1998

The Statutory Auditors

KLYNVELD PEAT MARWICK GOERDELERReviseurs d’Entreprises S.C.C.

represented byGeorges M. TlMMERMAN

DELOITTE & TOUCHEReviseurs d’Entreprises S.C.C.

represented byClaude POURBAIX

84


PARJOINTCO - SUMMARY CONSOLIDATED ACCOUNTS

Introduction

PARJOINTCO N.V., a company registered under Dutch law, was set up in 1990, on the basis of equality of shareholding andmanagement control between the FRÈRE-BOURGEOIS/NPM-CNP Group on the one hand and POWER CORPORATION OFCANADA on the other. It is the financial vehicle for joint control of the PARGESA/GBL/PARFINANCE groups, consolidatingapproximately 54.5 % of the capital of PARGESA which, in turn, controls GBL. These two latter companies together controlPARFINANCE (86.5 % of the capital).

Principles of consolidation

The audited accounts of the companies listed above were included as transmitted by their auditors, the only exceptions being thecorrecting entries necessary to bring them in line with the Belgian accounting principals and those allowing the change fromconsolidation under the equity method to full consolidation of GBL and PARFINANCE by PARGESA ; the accounts presented herealso consolidate ELECTRAFINA and AUDIOFINA, which are included in GBL’s accounts.

As already stated, positive goodwill relating to the various companies is not allocated but is shown as part of the cost of thecompanies on which it has arisen and amortised at a rate of 5 % per annum. However, following the sale by ELECTRAFINA of itsshares in TRACTEBEL in the second half of 1996, PARGESA considered it appropriate to record an exceptional amortisationcharge of BEF 431 million against its goodwill in GBL (BEF 237 million relating to the part belonging to PARJOINTCO).PARJOINTCO itself charged exceptional amortisation of BEF 680 million, calculated as the difference, at the time of its creation in1990, between the stock market value of the TRACTEBEL shares and their consolidated book value within thePARGESA/GBL/PARFINANCE Group.Similarly, in 1997, because of the capital gains made by the PARGESA Group on its shareholdings in BBL and in CLT,PARJOINTCO booked an exceptional goodwill amortisation of BEF 621 million.

Highlights of the 1997 financial year

During the 1996 financial year, the equity of PARJOINTCO changed as follows (BEF million) :

- equity at 31.12.1996 38,530- profit for the year 8,002- distributed dividend (1,585)- translation adjustments 1,015- changes in accounting principles by PETROFINA (211)- equity at 31.12.1997 45,751

PARJOINTCO, as such, did not conduct significant financial operations during the 1995 financial year. Operations conducted byPARJOINTCO’s subsidiaries (PARGESA, GBL, PARFINANCE, ELECTRAFINA and AUDIOFINA) are described in themanagement report section. The most significant accounting impacts come from the capital gains booked on the shareholding inCLT (upon grouping of the CLT activities with those of UFA) and on BBL shares as a consequence of the Public Offer by ING.

85


PARJOINTCO - SIMPLIFIED CHART

Consolidation structure at 31 December 1997

GROUPE BRUXELLES LAMBERTPARFINANCE

ROYALE VENDÔME

MONUMENT OIL & GAS

CLT-UFA

PETROFINA

COMETRAORIOR HOLDING

IMÉTAL

54.5 % Equity62.1 % Votes

PARJOINTCO

PARGESA HOLDING

45.8 %48.9 % Balance sheet48.2 % P&L (1)

25.1 %

51.2 %

83.1 %

22.7 %

25.6 %

100 %

40.7 %

ELECTRAFINA

AUDIOFINA

BERNHEIM-COMOFI

TRANSCOR

DUPUIS

DISTRIPAR / BSS

DEWAAY

40.5 %

47.6 %

49.0 %

50.0 %

38.0 %

FULLYCONSOLIDATED

PROPORTIONALLYCONSOLIDATED

CONSOLIDATION UNDERTHE EQUITY METHOD

20.4 %

54.4 %



CLT-UFA HOLDING

50 %

98 %

ROYALE BELGE

(1) shares acquired at the end of the year did not contribute to the 1997 profit


86


PARJOINTCO - BALANCE SHEETS

ASSETS Group share Minority interests Total(BEF million) 1997 1996 1995 1997 1996 1995 1997 1996 1995

Goodwill 3,803 3,862 5,532 10,501 24,971 13,580 14,304 28,833 19,112

Equity-accounted companies 19,974 21,411 19,622 72,670 87,446 97,510 92,644 108,857 117,132

Other fixed assets and investments 13,773 11,775 11,967 59,530 35,858 40,315 73,303 47,633 52,282

37,550 37,048 37,121 142,701 148,275 151,405 180,251 185,323 188,526

Current assets 17,315 8,830 9,963 56,482 31,704 22,012 73,797 40,534 31,975

Total 54,865 45,878 47,084 199,183 179,979 173,417 254,048 225,857 220,501

LIABILITIES AND EQUITY Group share Minority interests Total(BEF million) 1997 1996 1995 1997 1996 1995 1997 1996 1995

Equity (Group) 45,751 38,530 36,165 - - - 45,751 38,530 36,165

Minority interests - - - 186,078 162,843 148,337 186,078 162,843 148,337

Provisions for liabilities and charges 1,003 1,018 824 1,519 1,389 1,065 2,522 2,407 1,889

Long-term debt 2,936 4,405 6,336 10,275 11,959 13,977 13,211 16,364 20,313

Current liabilities 5,175 1,925 3,759 1,311 3,788 10,038 6,486 5,713 13,797

Total 54,865 45,878 47,084 199,183 179,979 173,417 254,058 225,857 220,501

87


PARJOINTCO - PROFIT AND LOSS STATEMENTS

RESULTS Group share Minority interests Total(BEF million) 1997 1996 1995 1997 1996 1995 1997 1996 1995

Dividends and interests 444 325 445 1,768 796 1,293 2,212 1,121 1,738

Results of equity-accountedcompanies 2,575 2,414 2,031 8,060 11,652 10,994 10,635 14,066 13,025

Income from investments 3,019 2,739 2,476 9,828 12,448 12,287 12,847 15,187 14,763

Gains on disposal of current assets 202 79 76 346 104 224 548 183 300

Other financial revenue 1,164 885 800 4,032 2,397 1,750 5,196 3,282 2,550

Interest expenses (378) (360) (537) (888) (894) (1,170) (1,266) (1,254) (1,707)

Losses, amounts written off andwritten back on current assets (48) - (70) (109) - (261) (157) - (331)

Other financial expenses (651) (220) (122) (1,987) (673) (341) (2,638) (893) (463)

Other expenses and operating revenue (250) (297) (211) (473) (481) (467) (723) (778) (678)

Operating income before taxes 3,058 2,826 2,412 10,749 12,901 12,022 13,807 15,727 14,434

Gains on disposal of investments 6,281 2,832 315 22,863 17,515 959 29,144 20,347 1,274

Losses, amounts written off andwritten back on investments (132) (246) (111) (474) (580) (337) (606) (826) (448)

Amortisation of goodwill (1,169) (1,410) (441) (1,100) (1,659) (1,034) (2,269) (3,069) (1,475)

Other extraordinary revenue/(expenses) 1 (269) (2) (30) (722) 21 (29) (991) 19

Capital result before taxes 4,981 907 (239) 21,259 14,554 (391) 26,240 15,461 (630)

Taxes (37) (7) (3) (196) (18) (115) (233) (25) (118)

Net profit 8,002 3,726 2,170 31,812 27,437 11,516 39,814 31,163 13,686

88



GOODWILL


1997 1996 1995 1997 1996 1995 1997 1996 1995PARGESA 710 1,330 2,093 - - - 710 1,330 2,093PETROFINA 1,012 1,091 1,124 6,826 7,627 8,278 7,838 8,718 9,402ROYALE BELGE 498 536 599 1,370 1,518 1,675 1,868 2,054 2,274GBL 1,034 417 804 863 342 644 1,897 759 1,448IMÉTAL 442 331 474 791 588 1,513 1,233 919 1,987Others 107 157 438 651 14,896 1,470 758 15,053 1,908Total 3,803 3,862 5,532 10,501 24,971 13,580 14,304 28,833 19,112

INVESTMENTS IN EQUITY-ACCOUNTED COMPANIES

(BEF million) % held Group share Minority interests Total

1997 1996 1995 1997 1996 1995 1997 1996 1995 1997 1996 1995IMÉTAL 54.4 52.5 52.7 8,238 7,098 4,028 14,755 12,601 12,839 22,993 19,699 16,867PETROFINA 22.7 22.8 22.8 4,455 4,069 3,563 30,874 28,454 26,254 35,329 32,523 29,817BBL - 12.4 12.4 - 2,987 2,751 - 8,459 7,695 - 11,446 10,446TRACTEBEL - - 20.5 - - 2,594 - - 19,118 - - 21,712ROYALE BELGE 12.9 12.9 13.0 2,879 2,292 2,054 7,916 6,489 5,743 10,795 8,781 7,797ORIOR HOLDING 83.1 74.1 69.0 1,980 1,721 1,749 1,651 1,406 1,400 3,631 3,127 3,149COMETRA 100.0 100.0 100.0 655 611 488 4,414 4,270 3,595 5,069 4,881 4,083CLT-UFA (1) 50.0 97.1 96.8 634 1,342 1,081 8,788 21,145 16,249 9,422 22,487 17,330BERNHEIM-COMOFI 40.5 40.5 40.5 385 373 426 1,060 1,058 1,192 1,445 1,431 1,618MONUMENT / NIMEX 25.6 25.7 66.7 319 228 215 2,147 1,595 1,587 2,466 1,823 1,802Others 429 690 673 1,065 1,969 1,838 1,494 2,659 2,511Total 19,974 21,411 19,622 72,670 87,446 97,510 92,644 108,857 117,132

(1) CLT-UFA HOLDING, 50 % jointly held, owns 98 % of CLT-UFA

PROFITS OF EQUITY-ACCOUNTED COMPANIES

(BEF million) Profit (100 %) Group share Minority interests Total

1997 1996 1995 1997 1996 1995 1997 1996 1995 1997 1996 1995IMÉTAL (FRF) 620 614 596 724 692 443 1,306 1,229 1,412 2,030 1,921 1,855ROYALE BELGE 23,159 11,315 6,176 722 418 234 2,028 1,183 655 2,750 1,601 889PETROFINA 22,060 16,048 11,608 630 450 310 4,367 3,158 2,287 4,997 3,608 2,597BBL 11,778 10,291 8,941 384 333 292 1,078 943 817 1,462 1,276 1,109BERNHEIM-COMOFI 317 (160) 426 35 (18) 43 98 (50) 122 133 (68) 165ORIOR HOLD. (CHF) 1.6 6.8 12.4 12 68 118 10 55 94 22 123 212CLT-UFA (2,882) 3,372 3,335 (87) 194 200 (1,336) 3,049 3,008 (1,423) 3,243 3,208TRACTEBEL (1) - 7,510 11,335 - 196 283 - 1,374 2,083 - 1,570 2,366Others 155 352 75 509 1,127 275 664 1,479 350Total 2,575 2,739 2,031 8,060 12,448 10,994 10,635 15,187 13,025

(1) In 1996, this shareholding contributed to the profit only for the first six months

89



GAINS ON DISPOSAL OF INVESTMENTS


1997 1996 1995 1997 1996 1995 1997 1996 1995BBL 3,639 - - 10,212 - - 13,851 - -CLT 1,259 - - 3,533 - - 4,792 - -Oil assets 829 - - 5,747 - - 6,576 - -GIB GROUP 211 - - 593 - - 804 - -TRACTEBEL - 2,341 - - 16,434 - - 18,775 -CARNAUDMETALBOX - 370 - - 658 - - 1,028 -Others 343 121 315 2,778 423 959 3,121 544 1,274Total 6,281 2,832 315 22,863 17,515 959 29,144 20,347 1,274

LOSSES ON DISPOSAL OF INVESTMENTS (-), AMOUNTS WRITTEN OFF (-) AND WRITTEN BACK (+)


1997 1996 1995 1997 1996 1995 1997 1996 1995PARIBAS 131 (181) (53) 236 (490) (170) 367 (671) (223)Others (263) (65) (58) (710) (90) (167) (973) (155) (225)Total (132) (246) (111) (474) (580) (337) (606) (826) (448)

AMORTISATION OF GOODWILL


1997 1996 1995 1997 1996 1995 1997 1996 1995PARGESA by PARJOINTCO (735) (840) (156) - - - (735) (840) (156)GBL by PARGESA (183) (330) (94) (152) (269) (76) (335) (599) (170)PETROFINA (85) (86) (82) (592) (601) (605) (677) (687) (687)IMÉTAL (71) (42) (41) (128) (74) (132) (199) (116) (173)ROYALE BELGE (50) (50) (52) (140) (140) (145) (190) (190) (197)AUDIOFINA / CLT - (54) - - (529) - - (583) -Others (45) (8) (16) (88) (46) (76) (133) (54) (92)Total (1,169) (1,410) (441) (1,100) (1,659) (1,034) (2,269) (3,069) (1,475)

90



The financial statements of the major non-listed shareholdings (other than PARJOINTCO) equity-accounted by NPM/CNP arepresented hereafter in a summarized version :

ACIDE CARBONIQUE PUR (BEF million)

1997 1996 1995 1994 1993Intangible assets - - - 5 9Tangible assets 1,799 1,763 1,926 2,149 1,995Investments 1 43 11 31 434Inventories 56 58 56 56 51Receivables 413 720 663 720 239Other current assets 2,236 1,348 1,359 2,121 1,749Assets 4,505 3,932 4,015 5,082 4,477Equity (before dividends) 1,605 1,444 1,243 2,601 2,542Minority interests 1 1 1 1 1Provisions for liabilities and charges 155 163 187 186 222Long-term debt 1,320 740 952 1,198 1,134Non financial short-term debt 737 1,086 528 859 360Other short-term liabilities 687 498 1,104 237 218Liabilities and equity 4,505 3,932 4,015 5,082 4,477

Turnover 1,102 1,081 1,072 1,084 1,178Cash flow before tax 496 457 434 330 1,462Total profit before tax 282 213 153 110 1,231Net income 271 201 132 74 1,089Dividend 100 100 1,482 - -

ÉDITIONS DUPUIS (BEF million)

1997 1996 1995 1994 1993Intangible assets 312 238 310 299 349Tangible assets 188 203 214 232 126Investments 29 14 46 11 2Inventories 329 378 288 294 358Receivables 620 735 460 386 516Other current assets 398 265 292 408 546Assets 1,876 1,833 1,610 1,630 1,897Equity (before dividends) 783 762 692 686 1,022Minority interests - - - - -Provisions for liabilities and charges - - 23 25 30Long-term debt 47 58 66 77 88Non financial short-term debt 1,046 1,013 729 692 757Other short-term liabilities - - 100 150 -Liabilities and equity 1,876 1,833 1,610 1,630 1,897


91



IJSBOERKE (1) (BEF million)

1997 1996 1995 1994 1993Intangible assets 8 9 10 12 1Tangible assets 585 740 816 883 955Investments 21 22 22 25 26Inventories 166 215 245 194 181Receivables 139 137 146 148 133Other current assets 61 50 55 62 72Assets 980 1,173 1,294 1,324 1,368Equity (before dividends) 210 209 188 223 151Minority interests - - - - -Provisions for liabilities and charges 84 137 162 163 166Long-term debt 308 357 468 517 659Non financial short-term debt 202 261 341 295 280Other short-term liabilities 176 209 135 126 112Liabilities and equity 980 1,173 1,294 1,324 1,368


(1) Group accounts including IJSBOERKE, STARCO TIELEN, IMMO TIELEN and BELHOLDING.

SUZY (BEF million)

1997 (1)

Intangible assets -Tangible assets 311Investments -Inventories 143Receivables 322Other current assets -Assets 776Equity (before dividends) 77Minority interests -Provisions for liabilities and charges 9Long-term debt 200Non financial short-term debt 311Other short-term liabilities 179Liabilities and equity 776

Turnover 1,572Cash flow before tax 74Total profit before tax 28Net income 26Dividend -

The SUZY Group underwent majorrestructuring before its takeover byNPM/CNP ; the consolidated accountsof previous years are consequentlyimpossible to compare ; moreover theaccounting principles were notconsistent with those applied byNPM/CNP.

(1) accounts closed per 30 September.

92



HÉLIO CHARLEROI (BEF million)

1997 1996 1995 1994 1993Intangible assets - - - - -Tangible assets 649 856 1,083 1,259 937Investments 3 3 3 2 4Inventories 72 64 184 62 40Receivables 534 547 663 352 289Other current assets 122 135 181 95 98Assets 1,380 1,605 2,114 1,770 1,368Equity (before dividends) 448 329 230 192 183Minority interests - - - - -Provisions for liabilities and charges 118 65 30 5 5Long-term debt 434 597 804 939 553Non financial short-term debt 380 416 784 400 550Other short-term liabilities - 198 266 234 77Liabilities and equity 1,380 1,605 2,114 1,770 1,368


TRANSCOR (BEF million)

1997 1996 1995 1994 1993Intangible assets - - - - -Tangible assets 60 47 60 78 74Investments 25 82 20 37 59Inventories 1,225 2,272 1,179 1,599 2,002Receivables 2,275 2,306 2,145 3,158 4,396Other current assets 1,486 844 968 1,728 1,398Assets 5,071 5,551 4,372 6,600 7,929Equity (before dividends) 1,634 1,431 1,253 1,511 1,600Minority interests - - - 9 15Provisions for liabilities and charges 36 36 37 35 38Long-term debt - - - - -Non financial short-term debt 3,092 3,662 2,884 3,689 3,384Other short-term liabilities 309 422 198 1,356 2,892Liabilities and equity 5,071 5,551 4,372 6,600 7,929


93


Balance sheets................................................................................................................. 94


Extract from the notes to the non-consolidated accounts at 31 December 1997 ............ 98

NOTICEIn accordance with article 80bis of the Co-ordinated Laws on Commercial

Companies, the statutory accounts presented in this chapter are anabridged version of the Parent Company accounts, and they include neitherall the notes and information required by law nor the report of the Statutory

Auditors, who have provided an unqualified opinion. The complete accountswill be deposited at the NATIONAL BANK OF BELGIUM and will also be

available at the Company’s head office.

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BALANCE SHEETS

ASSETS (BEF thousand) 1997 1996 1995

FIXED ASSETS 52,973,161 48,326,675 48,281,150III. Tangible fixed assets 96,749 1,718 4,547

A. Lands and buildings 4,078 - -C. Furniture and vehicles 3,583 1,718 4,547E. Assets under construction and advance

payments 89,088 - -IV. Investments 52,876,412 48,324,957 48,276,603

A. Subsidiaries1. Shareholdings 28,431,269 25,060,164 22,973,042

B. Related companies1. Shareholdings 15,342,469 15,342,469 18,995,7852. Receivables - - 1,772,996

C. Other investments1. Stocks and shares 9,102,674 7,922,324 4,534,780

CURRENT ASSETS 16,115,778 16,401,285 19,146,808VII. Amounts receivables within one year 6,305,355 7,841,266 12,565,431

B. Other receivables 6,305,355 7,841,266 12,565,431VIII. Short-term investments 6,503,957 5,356,005 4,118,532

A. Own shares - 28,396 -B. Other investments 6,503,957 5,327,609 4,118,532

IX. Cash at bank and in hand 3,207,265 3,080,752 2,250,780X. Deferred expenses and accrued income 99,201 123,262 212,065

TOTAL ASSETS 69,088,939 64,727,960 67,427,958

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BALANCE SHEETS

LIABILITIES AND EQUITY (BEF thousand) 1997 1996 1995

EQUITY 55,427,857 53,741,840 51,416,304I. Capital 4,751,250 4,751,250 4,751,250

A. Issued capital 4,751,250 4,751,250 4,751,250II. Share premium account 42,824,428 42,824,428 42,824,428IV. Reserves 1,591,909 1,129,203 766,408

A. Legal reserve 475,125 475,125 475,125B. Non-distributable reserves

1. Own shares 825,501 362,795 -2. Others 215 215 215

C. Tax-free reserves 221,068 221,068 221,068D. Distributable reserves 70,000 70,000 70,000

V. Profit carried forward 6,260,270 5,036,959 3,074,218

PROVISIONS AND DEFERRED TAXATION 4,000 23,500 142,410VII. A. Provisions for liabilities and charges 4,000 23,500 142,410

4. Other liabilities and charges 4,000 23,500 142,410

LIABILITIES 13,657,082 10,962,620 15,869,244VIII. Amounts payable after more than one year 3,273,750 3,273,750 3,273,750

A. Financial liabilities2. Non-subordinated debentures 3,273,750 3,273,750 3,273,750

IX. Amounts payable within one year 10,065,945 7,190,344 12,320,565B. Financial debts

1. Amounts due to financial institutions 1,220,973 1,019,941 995,6122. Other loans 6,050,000 3,500,000

C. Trade payables1. Suppliers 19,636 2,065 1,098

E. Taxes, salaries and social charges payable1. Taxes 80,845 77,064 48,1862. Salaries and social charges - 176 176

F. Other liabilities 2,694,491 2,591,098 11,275,493X. Accrued expenses and deferred income 317,387 498,526 274,929

LIABILITIES AND EQUITY 69,088,939 64,727,960 67,427,958

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EXPENSES (BEF thousand) 1997 1996 1995A. Interest expense 357,400 395,844 487,591B. Other financial expense 85,913 143,179 82,611C. Miscellaneous goods and services 68,083 311,465 48,293D. Payroll expenses 27,181 34,532 38,432E. Miscellaneous operating expenses 19,232 140 184F. Depreciation and write-off of formation expenses,

tangible and intangible assets 3,913 2,560 3,351G. Write-off on 114,520 234 1,021,627

1. investments - - 941,1742. current assets 114,520 234 80,453

H. Provisions for liabilities and charges 4,000 3,500 6,410I. Losses on disposal of 4,614 650 179,773

1. tangible and intangible fixed assets 88 - 2932. investments 90 16 168,5303. current assets 4,436 634 10,950

J. Exceptional expenses - 25,987 136,000L. Taxes 37,216 55,716 29,020M. Profit for the year 4,321,377 4,910,216 2,393,518

TOTAL EXPENSES 5,043,449 5,884,023 4,426,810

O. Profit for the year available for appropriation 4,321,377 4,910,216 3,673,341

PROFIT APPROPRIATION (BEF thousand) 1997 1996 1995C. Transfer to reserves 462,706 362,795 -

2. to the legal reserve - - -3. to other reserves 462,706 362,795 -

D. Profit carried forward 6,260,270 5,036,959 3,074,2181. Profit carried forward 6,260,270 5,036,959 3,074,218

F. Profit to be distributed 2,635,360 2,584,680 2,552,1881. Dividends to shareholders 2,635,360 2,584,680 2,552,188

9,358,336 7,984,434 5,626,406

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REVENUE (BEF thousand) 1997 1996 1995A. Revenue from investments 1,308,283 2,732,037 2,237,842

1. Dividends 1,308,283 2,697,893 2,163,9362. Interests - 34,144 73,906

B. Revenue from current assets 660,041 722,403 890,163C. Other financial revenue 252,573 93,528 66,387E. Other operating revenue 38,486 34,050 31,566G. Write-back on 847,452 64,670 84,316

1. investments 843,909 10,091 -2. current assets 3,543 54,579 84,316

H. Reversals of provisions for liabilities and charges 23,500 142,410 2,500I. Profits on disposal of 1,910,616 2,089,104 1,102,255

1. tangible and intangible fixed assets 574 108 -2. investments 1,302,824 1,901,008 706,7623. current assets 607,218 187,988 395,493

J. Extraordinary revenue 6 60 -L. Adjustment of income taxes and write-back of tax

provisions 2,492 5,761 11,781

TOTAL REVENUE 5,043,449 5,884,023 4,426,810

N. Transfer from tax-free reserves - - 1,279,823

PROFIT APPROPRIATION (BEF thousand) 1997 1996 1995A. Profit available for appropriation 9,358,336 7,984,434 5,626,406

1. Profit for the year available for appropriation 4,321,377 4,910,216 3,673,3412. Profit brought forward from the previous year 5,036,959 3,074,218 1,953,065

9,358,336 7,984,434 5,626,406

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VIII. Statement of capital

A. Share capital In BEF thousand Number of shares1. Issued capital

- opening balance 4,751,250 25,340,000- changes during the year - -- closing balance 4,751,250 25,340,000

2. Description of capital2.1. Types of shares

- ordinary 4,651,281 24,806,830- AFV 1 9,075 48,400- AFV 2 144 770- AFV 3 45,375 242,000- AFV 4 45,375 242,000

2.2. Registered or bearer shares- registered 17,932,201- bearer 7,407,799

D. Commitments to issue shares2. Subscription rights

- number of subscription rights in issue- until 1999, at BEF 1,696 per share 200,000- until 1999, at BEF 2,365 per share 1,500,000

- capital to be subscribed 318,750- maximum number of shares to be issued 1,700,000

E. Capital authorised but not issued 2,000,000

G. Shareholding structure (law of 2 March 1989)At 31 December 1997, based on declarations received by that date :

Percentages

ShareholdersNumber

of shares heldNumber

of warrantsnon

dilutedfully

dilutedDate of

declarationINVESTOR 91,202 1,500 0.36 0.35 30.06.97CARPAR 286,917 - 1.13 1.06 30.06.97NPM/CNP - 299 - - 30.06.97Sub-Group NPM/CNP 378,119 1,799 1.49 1.41 30.06.97FIBELPAR 11,393,967 - 44.97 42.14 30.06.97PAM N.V. 2,210,070 - 8.72 8.17 30.06.97ERBE FINANCE - 103,750 - 0.38 30.06.97BELGIAN SKY SHOPS 670,930 (1) - 2.65 2.48 30.06.97IMMOBILIÈRE BERNHEIM-OUTREMER 71,001 (1) - 0.28 0.26 30.06.97FIBELPAR Group and associated companies 14,724,087 105,549 58.11 54.84 30.06.97

UAP VIE 1,261,066 - 4.98 4.66 21.03.94ROYALE BELGE 1,149,382 - 4.54 4.25 21.03.94URBAINE UAP (2) 266,666 - 1.05 0.99 21.03.94LLOYD BELGE (2) 69,595 - 0.27 0.26 21.03.94L’ASSURANCE LIEGEOISE (2) 42,000 - 0.17 0.16 21.03.94FOYER BELGE (2) 10,666 - 0.04 0.04 21.03.94UAP (now AXA-UAP) and ROYALE BELGE Groups 2,799,375 - 11.05 10.35 21.03.94

(1) early April 1998, BELGIAN SKY SHOPS owned 87,449 NPM/CNP shares, representing 0.35 % and 0.32 % of the non diluted and fully diluted capital of theCompany and IMMOBILIÈRE BERNHEIM-OUTREMER did not hold any share any longer

(2) the shares held by those companies were subsequently bought by ROYALE BELGE 1994

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XX. Accounting policies

1. Formation expenses

Formation expenses are written off by at least 20 % per annum. The issue costs of borrowed capital, discounts andpremiums on loans are written off over the loan period.

In any event, the Board of Directors can decide to write off the formation expenses in the year in which they wereincurred.

2. Tangible fixed assets

Tangible fixed assets are recorded at cost or at the contributed value.

The straight line depreciation method is used and the following annual rates are applied :

- real estate rights 2 % (duration of the rights)- vehicles 25 %- furniture and office equipment 20 %- computer equipment 33 %- telephone facilities 33 %

3. Investments

a) Shareholdings and other securitiesShareholdings and other securities are recorded at cost, taking account of any adjustments to the value which maybe necessary, excluding incidental costs which are written off in the year in which they are incurred.

ShareholdingsShareholdings value is estimated at the end of each financial year, based primarily on a prudent assessment of theunderlying net assets, taking into account latent gains and losses which are considered to be of a permanent naturein view of the circumstances, profitability and known prospects of the Company.

The value of shareholdings is reduced to the extent that there has been a permanent impairment in value.

However, as provided for in article 34 of the Royal Decree of 8 October 1976, the Board may decide to takepermanent increases in the value of investments directly to section III of the balance sheet without passing throughthe income statement.

Other securitiesShares quoted on the stock exchange or in public sale are valued at the market price, if significant.Unquoted shares, and shares in which there is not considered to be significant trading, are valued in the same wayas shareholdings.The carrying value is reduced where there has been a permanent impairment in value.

b) Other investmentsThese are recorded at their cost or nominal value. The carrying value is reduced where there has been a permanentimpairment in value.

c) Receivables and guaranteesReceivables, including fixed interest bonds, included in investments, are written down where repayment at maturity,in whole or in part, is uncertain or otherwise compromised.

4. Amounts receivable after more than one year

These are valued in the same way as receivables included in other investments.

5. Amounts receivable within one year

These are valued in the same way as receivables included in other investments but without considering the permanentnature of impairments in value.

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6. Short-term investments

These are recorded at cost excluding incidental expenses which are charged to the income statement.

In general, shares quoted on the stock exchange or in public sale are valued in the same way as other securitiesincluded in investments. However, write-downs are recorded, whether or not they are considered to be permanent.

7. Provisions for liabilities and charges

At the end of each financial year, the Board of Directors examines previous provisions and considers new provisionsrequired to cover possible liabilities or charges.

8. Commitments and recourse against third parties

The Board of Directors values commitments and recourse against third parties at the nominal value of the legalcommitment referred to in the contract ; if there is no nominal value or in borderline cases, they will be noted for therecord only.

9. Assets and liabilities recorded in foreign currencies

These are translated at the buying rate on the last day of the financial year.

10. Cost Association (1)

The Company is a member of a cost association (Association de frais), set up as an autonomous grouping with no legalpersonality, by a number of related companies, with the aim of rationalising and reducing their administrative costs bycombining their staff, offices, property, equipment and, in general, all the expenses incurred in managing theiroperations.

The allocation of expenses and costs incurred by the association is carried out in accordance with the following rules :

- Expenses and costs - mainly payroll and miscellaneous costs - relating to operations and particular events occurringduring the financial year and involving one or more of the members of the association are charged directly to themember or members concerned on an actual or lump sum basis depending on the circumstances, and on the basisof appropriate documentation.

- The balance of the expenses and charges is allocated proportionally among the members of the association inaccordance with a formula based primarily on estimated net assets, annual movement in net assets and grossoperating income.

A statement of costs is drawn up at the end of each financial year indicating, by income statement item, the shareallocated to each member of the association.

(1) NPM/CNP is also charged, based on actual services rendered, with invoices from CENTRE DE COORDINATION DE CHARLEROI (accounting,treasury, personnel and administration services) and by COMPAGNIE IMMOBILIÈRE DE ROUMONT (management of the building and of theshareholdings).

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REFERENCE DOCUMENT

REFERENCE DOCUMENT RELATING TO A POSSIBLEPUBLIC SUBSCRIPTION OFFER OF SHARES AND THEIR LISTING

ON THE PRIMARY MARKET

In the framework of the dissociated information procedure laid down by the Royal Decree of 13 February 1996,NPM/CNP has adapted the content of its annual report to allow it to be used as reference document for the possibleissue of listed shares.

In such a case, this document together with the operations note published at the time of the issue will constitute theprospectus in accordance with schemes A or B of the Royal Decree of 18 September 1990.

In order to aid the reader locate the information provided by this Royal Decree, this document incorporates areference table ; in those cases where the information is not readily available by other means, the information itself isprovided.

If a public issue does indeed take place, the information included in the present annual report will be updated in thetransaction notice.

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REFERENCE DOCUMENT

Part I : INFORMATION REGARDING RESPONSIBILITY FOR THE PROSPECTUS AND FOR THE AUDIT OFTHE ACCOUNTSThis information will be included in the eventual operations note.

Part II : INFORMATION RELATING TO THE SHARES AND THEIR LISTING ON THE PRIMARY MARKETThis information will be included in the eventual operations note.

Part III : INFORMATION ABOUT THE COMPANY AND ITS SHARE CAPITAL

3.1. Identification of the Company

3.1.0. Name, registered and administration officesNATIONALE PORTEFEUILLEMAATSCHAPPIJ N.V. / COMPAGNIE NATIONALE À PORTEFEUILLE S.A.,abbreviated to NPM/CNP.The registered office of the Company is at 6280 Loverval (Gerpinnes), rue de la Blanche Borne, 12. The registeredoffice may be transferred to any location in Belgium by decision of the Board of Directors.

3.1.1. Date of incorporation and durationThe Company was incorporated for an unlimited duration on 20 November 1906 under the name « LE GAZ RICHE »as a public company with limited liability (« société anonyme »), by public deed executed by Maître Émile LEFÈBVRE,public Notary in Antwerp, published in the annex of the Belgian « Official Gazette » dated 3-4 December 1906, undernumber 6133.The articles of incorporation have been amended for the last time by public deed executed by Maître Hubert MICHEL,public Notary in Charleroi under the intervention of Maître Gilberte RAUCQ, public Notary in Brussels on 11 June1997, published in the annex of the Belgian « Official Gazette » on 4 July 1997.

3.1.2. Legislation under which the Company operates and legal formSee point 3.1.1.

3.1.3. Objects of the CompanyAccording to Article 3 of the statutes :« The objects of the Company are the purchase, the sale, the assignment, the exchange and the management of anysecurities, shares, bonds, government bonds or any other financial or non financial assets or rights ; the holding underany form, in any company or business in the production and/or distribution of energy, or in industry, commerce,finance, real estate or other, existing or to be incorporated.Among others, NPM/CNP may acquire through purchase, exchange, contribution, subscription, underwriting, option orany other means, any security, asset, receivables or intangible asset ; participate in any association or merger ;manage or enhance the value of its securities and shareholdings portfolio ; realise or liquidate such assets byassignment, sale or any other means.NPM/CNP may conduct any financial, commercial, industrial and real estate operations or transactions, directly orindirectly related to its objects or designed to realise such objects. ».

3.1.4. Commercial registersThe Company is registered in the commercial registers of Charleroi under number 161,072.

3.1.5. Places of consultation of public documentsThe co-ordinated articles of incorporation of NPM/CNP may be consulted at the Commercial Court in Charleroi and inthe registered office of NPM/CNP.The annual accounts are filed with the NATIONAL BANK OF BELGIUM. All appointment and dismissal of therepresentatives of NPM/CNP are published in the annex of the Belgian « Official Gazette ».Financial notices are published in the financial press and on the internet website (http://www.cnp.be). The otherdocuments available to the public and mentioned in an eventual prospectus may be consulted at the registered officeof NPM/CNP.The annual reports are sent to the registered shareholders and to each person asking to receive them.

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REFERENCE DOCUMENT

3.2. Share capital

3.2.0. Issued capitalThe fully paid share capital of the Company amounts to BEF 4,751,250,000. It is represented by 25,340,000 shareswith no designated nominal value of which 24,806,830 are ordinary shares, 48,400 are AFV1 shares, 770 are AFV2shares, 242,000 are AFV3 shares and 242,000 are AFV4 shares.The ordinary shares include notably 1,474,970 VVPR shares issued by public subscription and 1,740,460 VVPRshares placed with the company FIBELPAR which were the object of a limited subscription with the issuer. The rightsattached to the shares are the following :a. Right to vote at General Meetings

Each share carries one vote.b. Preferential rights in the event of share capital increases

In the event of a share capital increase by cash subscription, the new shares must be offered in the first instanceto existing shareholders pro rata to the number of shares held on the day of issue, as prescribed by law.The General Meeting nonetheless has the right to cancel or to limit the preferential subscription rights in theinterest of the company to the extent permitted by the Co-ordinated Laws on Commercial Companies, or tosuspend the rights for a limited period.Any proposal by the Board of Directors to limit or to suspend the preferential subscription rights must be justified ina detailed report, which covers in particular the issue price and the financial consequences for Shareholders. Areport is also made up by the Auditors, in which they state that the financial information and the accountscontained in the report by the Board are correct. These reports are filed with the clerk of the Commercial Tribunal.In the event of a share capital increase by cash subscription, the holders of convertible bonds, of bondsredeemable in shares, of subscription rights or of other securities, may convert their holding or exercise theirsubscription rights and thus participate in the new issue to the extent that this right is bestowed on existingshareholders.The Board of Directors always retains the right to conclude agreements under, conditions which it deemsappropriate, with any third party in order to ensure the subscription of all or part of the issue shares.

c. Appropriation of profitsNet profits are allocated as follows :1. A minimum of 5 % is transferred to the legal reserve until this reaches 10 % of share capital.2. The remaining amount is allocated as decided upon by the General Meeting following a proposal by the Board

of Directors.Nevertheless, existing AFV shares which benefit from the advantages provided for by Royal Decrees 15 and 150,are also assigned the saving made by the company as a result of the tax exemption of income assigned to suchAFV shares - to the extent that an ordinary dividend is declared. This additional benefit is limited to tax savingsmade, or which will be made in the future, in relation to the financial year ending no later than 31 December 1996(tax year 1997).The Board of Directors may, within the conditions laid down by law, distribute advances on the dividend forthe year.

d. LiquidationIn the event of the liquidation of the company, the net assets, after payment of all debts, charges and liquidationcosts, will be used in the first instance to reimburse the paid up portion of share capital - in cash or in securities.The remaining balance will be distributed equally over all shares.

3.2.1. Authorised share capitalBy decision of the Shareholders’ Extraordinary General Meeting of 12 June 1996, the Board of Directors authorised,for a period of five years starting on 9 July 1996, to increase share capital by up to BEF 2 billion in one or morestages. The method used to increase the share capital is to be determined by the Board and may consists of theissue of shares with or without voting rights. This authorisation may be renewed in accordance with relevant laws. Theincrease in share capital decided on with regards to this authorisation may incorporate cash or non-cash considerationor may, to the extent permitted by the Co-ordinated Laws on Commercial Companies (CLCC), incorporate the use ofreserves including the share premium reserve.

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REFERENCE DOCUMENT

The use of reserves may take place with or without the issue of new securities. The Board of Directors is expresslypermitted to proceed with share capital increases under the condition laid down by the CLCC, in the case of atakeover bid relating to securities issued by the company and on condition that notice to this effect is given to theBANKING AND FINANCE COMMISSION within 3 years of the Extraordinary General Meeting of 12 June 1996. In theevent where the Board of Directors decides to increase share capital in the framework of the authorisation by the issueof shares by cash subscription, of convertible bonds, of bonds redeemable in shares, of subscription rights or of othersecurities, it may, in the interest of the company and under the conditions laid down by the CLCC, limit or cancel thepreferential rights of existing shareholders, to the advantage of a person or specific persons even if these are not staffmembers of the company or its subsidiaries.Under the same conditions and in accordance with 101 bis to 101 octies of the CLCC. The Board of Directors is alsoauthorised to proceed with the issue of convertible bonds or bonds redeemable in shares (whether subordinated ornon-subordinated), of subscription rights or other securities (whether or not attached to bonds), or other financialinstruments which could lead to an increase in share capital of up to BEF 2 billion.In the framework of this authorisation, the exercising of all warrants in issue would utilise authorised share capital ofBEF 318,750,000 (i.e. the maximum increase in share capital resulting from the exercising of the 1,500,000 warrantsissued on 28 February 1994 and the 200,000 warrants granted to staff members and certain Directors).

3.2.2. Shares not representing the capitalThere are no such shares.

3.2.3. Bonds issued, liabilities and commitments of the CompanyIn March 1994, the Company issued 30,000 A bonds 6.70 % 1994-1999 with a unitary nominal value of BEF 50,000,totalling BEF 1,500,000,000.Simultaneously the Company issued 750,000 B bonds 5.0625 % 1994-1999 with a unitary nominal value ofBEF 2,365, totalling BEF 1,773,750,000. These bonds were accompanied by two warrants exercisable between1 June and 15 June of 1994 and 1999 by subscription to one NPM/CNP share at the price of BEF 2,365 ; this gives atotal of 1,500,000 warrants. In accordance with the aim of the Company to gradually widen the membership, thesebonds were however offered on the Belgian market accompanied by one warrant only, and the other 750,000 weresold on the international market.The detail of the most significant other debts can be found on page 69 of this annual report.None of the Company’s bonds or debts are subject to specific guarantees given on any of its assets. Major off-balancesheet commitments are detailed on page 79 of this annual report.

3.2.4. Conditions for changes to the capital and to the rights of the various categories of sharesThe statutes of the Company do not include provisions regarding capital and rights modifications which would be morerestrictive than the legal provisions.

3.2.5. Changes in the share capital over the last three years and during the current yearNo capital increase has taken place over the last three years.

3.2.6. Persons in a position to influence the Company ...................................................................................page 253.2.7. Shareholders holding more than 5 % of the capital ..............................................................................page 983.2.8. Brief description of the Group ...................................................................................pages 25 à 27, 74 and 853.2.9. Own shares .............................................................................................................................pages 12 and 67

The Annual General Meeting of 11 June 1997 authorised the Board of Directors to acquire up to 1,500,000 shares inthe Company on the stock market at a minimum price of BEF 1,500 and a maximum price of BEF 3,000 per share,valid for a period of 18 months. It will be proposed to the Extraordinary General Meeting of Shareholders on 13 May1998 to renew this authorisation with a minimum price of BEF 1,500 and a maximum price of BEF 4,500.This provision applies to shares in the Company acquired by one or more of its subsidiaries in the sense of article 52quinquies § 1, second sub-paragraph of the co-ordinated laws on commercial companies.The Board of Directors may dispose of Company shares, on the stock market or in any other manner provided forunder the law, without the prior authorisation of the General Meeting.The Board of Directors was authorised, in compliance with the law, for a period of three years as from 4 July 1997, toacquire and dispose of shares in the Company in the cases provided for in article 52 bis § 4 sub-paragraph 2.2 for thepurpose of preventing serious and imminent danger to the Company.

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REFERENCE DOCUMENT

Part IV : INFORMATION ON THE ACTIVITIES OF THE COMPANY

4.1. Major activities of the Company4.1.0. Description of the major activities of the Company.........................................................................inside cover4.1.1. Breakdown of profit and of estimated value............................................................................... pages 13 to 224.1.2. Major branches and real-estate properties ....................................................................... pages 12, 62 and 764.1.3. Assessment of economically exploitable reserves and their probable duration

This information is not relevant in the case of NPM/CNP.4.1.4. Exceptional events ................................................................................................................................page 22

4.2. Dependence on licences and contractsThe activity of the Company does not depend on licences or on specific contracts having a significant impact on its futurefinancial situation.

4.3. Research and developmentThis information is not relevant in the case of NPM/CNP. As a holding company, NPM/CNP does not conduct research anddevelopment efforts.

4.4. Litigation or arbitrationTo the Board of Directors’ best knowledge, there is no pending litigation or arbitration which could have a significant impacton the financial situation of the Company (please also refer to page 79, note 2).

4.5. Going concernThe Company has not experienced recently any interruption in its business and is not aware of any event likely tocompromise the conduct of its activities.

4.6. Average staff number and evolution.................................................................................................................page 79

4.7. Investment policy

4.7.0. Major investments of the last three years and of the current financial year............... pages 9 to 11, 81 and 824.7.1. Major investments in progress and financing............................................................................... pages 9 to 114.7.2. Major investment commitments

No significant investment commitment was made by the Company, at the date of press of this document.

Part V : FINANCIAL INFORMATION

5.1. Accounts

5.1.0. Balance sheets and profit and loss accounts............................................................................. pages 94 to 975.1.1. Consolidated balance sheets and profit and loss accounts ....................................................... pages 62 to 65

5.1.2. Net operating profit per shareThe non-consolidated net operating profit per share has been (in BEF) :

1997 1996 199585.80 119.37 115.74

NPM/CNP being a holding company, the non-consolidated accounts are of little significance. The restrictedconsolidated and consolidated results per share are shown page 61.

5.1.3. Dividend per share .................................................................................................................. pages 24 and 61

5.1.4. Half-year resultsIn case more than nine months have elapsed since the end of the latest financial year, half-year results will beincluded in the operations note.

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5.1.5. Additional information in the case of non conformity to the European GuidelinesThe accounts of NPM/CNP being in conformity with the guidelines of the European Union, no additional informationneeds to be provided.

5.1.6. Sources and applications of funds ..........................................................................................pages 81 and 82

5.2. Information on shareholdings of the Company...........................................................pages 26 to 56, 75 and 84 to 92

5.3. Information on more than 10% held shareholdings....................................................................pages 26 to 56 and 75

5.4. Information on the consolidated accounts .....................................................................................................pages 59 to 92

5.5. Information in parts 4 and 7, extended to the Group levelThe information required in parts 4 and 7 is already extended to the Group level.

Part VI : INFORMATION ABOUT DIRECTORS, MANAGEMENT AND AUDITORS

6.1. Name, functions and major activities of the Directors, the members of the Executive Committeeand the Statutory Auditors .................................................................................................................................pages 2 and 3

John DILS, Chairman of the Board of Directors Independent non-executive DirectorMr. John DILS is Chairman of the Board of Directors of CONTRÔLE TECHNIQUE AUTOMOBILE « C.T.A. » and HonoraryVice-Chairman of the Board of Director of BBL. He is also Director of the ROYAL AUTOMOBILE CLUB DE BELGIQUE“R.A.C.B.” and of S.G.S. BELGIUM (SOCIÉTÉ GÉNÉRALE DE SURVEILLANCE).

Gilles SAMYN, Managing Director Executive DirectorMr. Gilles SAMYN is Managing Director of FRÈRE-BOURGEOIS, ERBE and FIBELPAR. He is Member of the ExecutiveCommittee of PARGESA and of GROUPE BRUXELLES LAMBERT, Chairman of the Board of Directors of ÉDITIONS DUPUIS,HÉLIO CHARLEROI, TRANSCOR and IJSBOERKE, and Director of various companies including IMÉTAL, PETROFINA andCLT-UFA.

Jean CLAMON, Director Non-executive DirectorMr. Jean CLAMON is Member of the Management Committee of BANQUE PARIBAS and Managing Director of ERBE. He isalso Director of COMPAGNIE DE NAVIGATION MIXTE, COBEPA, FIBELPAR and COMPAGNIE GÉNÉRALE MOSANE.

Laurent DASSAULT, Member of the Executive Committee Non-executive MemberMr. Laurent DASSAULT is Managing Director of DASSAULT INVESTISSEMENTS, Joint Managing Director of CHÂTEAUDASSAULT-ST-ÉMILION, Director of FINANCIÈRE ET IMMOBILIÈRE MARCEL DASSAULT and of BANQUE ROTHSCHILDLUXEMBOURG, and of various companies including DASSAULT INDUSTRIES, DASSAULT SYSTÈMES and DASSAULTBELGIQUE AVIATION.

Victor DELLOYE, Director - Secretary-General Executive DirectorMr. Victor DELLOYE is Director of FRÈRE-BOURGEOIS and of related companies. He is also Director of ROYALE BELGE.

Pierre-Alain DE SMEDT, Director Independent non-executive DirectorMr. Pierre-Alain DE SMEDT is Chairman of the Executive Committee of SEAT S.A. and Member of the world-wide ManagementCommittee of VOLKSWAGEN.

Thierry DORMEUIL, Director Non-executive DirectorMr. Thierry DORMEUIL is Member of the Executive Committee and Responsible of the agri-food, luxury goods, textile andbuilding materials sectors of the Consulting Department of the PARIBAS Group, Director of COMPAGNIE DE NAVIGATIONMIXTE, GUYORMARC’H, NORD EST, AXA RE FINANCE and COBEPA. He also represents SOCIÉTÉ GÉNÉRALECOMMERCIALE ET FINANCIÈRE at the Board of Directors of VIA BANQUE.

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Jacques FOREST, Director Non-executive DirectorMr. Jacques FOREST is Chairman of the Management Committee of P&V ASSURANCES, Censor of the NATIONAL BANK OFBELGIUM and Director of several companies including MULTIPHARMA and NAGELMACKERS.

Baron FRÈRE, Director (until 2 April 1998) Non-executive DirectorBaron FRÈRE is Chairman of the Board of Directors of FRÈRE-BOURGEOIS, ERBE, FIBELPAR, PETROFINA and ofELECTRAFINA, Chairman of the Board and Managing Director of GROUPE BRUXELLES LAMBERT and Vice-Chairman ofPARGESA HOLDING, PARFINANCE and ROYALE BELGE. He is Member of the Board of Trustees of SUEZ LYONNAISEDES EAUX, and Director of several companies including CLT-UFA, HAVAS, TF1 and LVMH. Baron FRÈRE is also HonoraryMember of the Board of Directors of the NATIONAL BANK OF BELGIUM.

Gérald FRÈRE, Director Non-executive DirectorMr. Gérald FRÈRE is Managing Director of FRÈRE-BOURGEOIS and Chairman of the Executive Committee of GBL. He is a.o.Director of ERBE, FIBELPAR, PARGESA, PARFINANCE, ROYALE BELGE, COBEPA and GIB. He is also Member of theBoard of Directors of the NATIONAL BANK OF BELGIUM.

Ségolène FRÈRE, Director (from 2 April 1998) Non-executive DirectorMiss Ségolène FRÈRE is student at the VESALIUS COLLEGE - VUB.

Jean-Pierre GERARD, Director Non-executive DirectorMr. Jean-Pierre GERARD is Managing Director of ROYALE BELGE. He is Member of the Executive Committee of AXA-UAPand Director of several companies of the ROYALE BELGE Group. He is also Member of the Executive Committee of UNIONPROFESSIONNELLE DES ENTREPRISES D’ASSURANCES (Professional Association of Insurance Companies) and Memberof the INSURANCE COMMISSION.

Philippe HUSTACHE, Director Non-executive DirectorMr. Philippe HUSTACHE is Managing Director of FINANCIÈRE ET IMMOBILIÈRE MARCEL DASSAULT and Director ofseveral companies including SANOFI and BANQUE VERNES.

Marcel NICOLAÏ, Director Independent non-executive DirectorMr. Marcel NICOLAÏ is Chairman of the Management Committee of VICTOIRE ASSET MANAGEMENT and manager of severalunit trusts.

Thierry de RUDDER, Director Non-executive DirectorMr. Thierry de RUDDER is Managing Director of GROUPE BRUXELLES LAMBERT and ELECTRAFINA. He is Chairman ofthe Board of Directors of BERNHEIM-COMOFI and Director of AUDIOFINA, ROYALE BELGE, PETROFINA, SOCIÉTÉGÉNÉRALE DE BELGIQUE, TRACTEBEL, MONUMENT OIL AND GAS (U.K.) and of several companies of GROUPEBRUXELLES LAMBERT.

Baron SANTENS, Director Independent non-executive DirectorMr. Marc SANTENS is Chairman of the SANTENS textile group.

Jo SANTINO, Director Non-executive DirectorMr. Jo SANTINO is Managing Director of COMPAGNIE GÉNÉRALE MOSANE and Member of the Management Committee ofCOBEPA. He is also Chairman of BERGINVEST and of T. PALM. He is Director of several other companies, includingFLORIDIENNE, SCHRÉDER, AUTOMATIC SYSTEMS, ARVAL BELGIUM and L’ÉCHO.

Gustaaf VAN den BEMPT, Director Independent non-executive DirectorMr. Gustaaf VAN den BEMPT is Master in Law and in Notary Right and Certified Accountant. He works as crisis manager forcompanies experiencing difficulties and as management consultant for small and medium-sized companies.

Philippe WILMES, Director Independent non-executive DirectorMr. Philippe WILMES is Chairman of the Executive Committee of SOCIÉTÉ FÉDÉRALE D’INVESTISSEMENT and ofSOCIÉTÉ BELGE D’INVESTISSEMENT INTERNATIONAL. He is also Member of the Board of Directors of the NATIONALBANK OF BELGIUM and Director of several companies including TRACTEBEL, CODITEL and of the BANK FORINTERNATIONAL PAYMENTS.

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Statutory Auditors

KLYNVELD PEAT MARWICK GOERDELER, Reviseurs d’Entreprises S.C.C.,Spoorweglaan, 3 – B-2610 Wilrijkrepresented by Georges M. TIMMERMAN

DELOITTE & TOUCHE, Reviseurs d’Entreprises S.C.C.,Brussels Airport Business Park - Berkenlaan, 6 – B-1831 Diegemrepresented by Claude POURBAIX

6.2. Relations with Directors and Managers

6.2.0. Salaries and fringe benefitsBased upon the 1997 accounts (in ,000 BEF) :

paid by theCompany

paid by subsidiariesof the Company

paid by theequity-accounted

companies (1)To Directors of the Parent Company- members of the Executive Committee- other directors

18,4513,150

1,952950

5,337-

21,601 2,902 5,337

To Members of the Executive Committee who are notDirectors 300 - n.a.

Advances and loans granted to Directors and Membersof the Executive Committee - - -

(1) only relates to Executive Directors ; in addition, PARJOINTCO paid in 1997 an amount of BEF 11,168(,000) to FRÈRE-BOURGEOIS HOLDING inconsideration for services rendered by its representatives.

The fees paid in 1997 to the Statutory Auditors of the Company in remuneration for their mandates amounted toBEF 360(,000). For additional services, DELOITTE & TOUCHE received an amount of BEF 346(,000) in 1997.

6.2.1. Shares and options of the CompanyAt 31 December 1997, no Director or Auditor was listed as a registered shareholder of the Company. Members of theBoard of Directors and of the Executive Committee were registered for 33,578 warrants at the same date. Thesewarrants can be exercised until November 1999 by subscription to one NPM/CNP share at the price of BEF 1,696.

6.2.2. Conflicts of interestsIn such instances, the Board of Directors establishes a special report included in the Annual Report of the Company inaccordance with legal requirements.

6.2.3. Loans and advancesSee point 6.2.0.

6.3. Stock option planThe Company issued on 30 June 1990 200,000 warrants reserved for the Personnel and the Managers ; these warrants canbe exercised until November 1999 by subscription to one NPM/CNP share at a price of BEF 1,696.At the date of press of this document, notwithstanding realised transactions, no warrant had been exercised yet.

Part VII : INFORMATION ON THE RECENT EVOLUTION AND PROSPECTS OF THE COMPANY

Information available at the date of press of this document is included in the Directors’ report (pages 9 to 12 and 23) ; should apublic subscription offer take place, the related information would be updated in the operations note.

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ADJUSTMENT FACTORS

BASE PRINCIPLESVarious adjustment factors are used in order to allow data related to different years to be compared, cancelling the diluting effect ofcapital increases.

COMPUTATION METHODS1. Factors applicable to results and dividends

These adjustment factors cancel the diluting effect of effectively carried out capital increases and are computed based uponthe non-diluted estimated value.

2. Factors applicable to the fully diluted estimated valueThese adjustment factors cancel the diluting effects of effective or potential (warrants) capital increases and are calculatedbased upon the fully diluted estimated value.

3. Factors applicable to stock market pricesThese adjustment factors are of course computed based upon the stock market prices.

YEARLY ADJUSTMENT FACTORS

1. results and dividends 2. estimated value (fully diluted) 3. stock market prices

1987 0.8713 0.8527 0.94661988 0.8764 0.9056 0.98671989 0.9501 0.9494 1.00001990 0.9701 0.9515 1.00001991 0.9778 0.9591 1.00001992 0.9778 0.9591 1.00001993 0.9778 0.9591 1.00001994 1.0000 0.9809 1.00001995 1.0000 0.9817 1.00001996 1.0000 0.9896 1.00001997 1.0000 1.0000 1.0000

Documents

the value - KU Leuven · AXA-UAP (4) — 9901.1% ORIOR — 9811.1% TRANSCOR 778 901.0% ACP 580 —0.7% …DITIONS DUPUIS 391 450.5% H…LIO CHARLEROI 187 210.2% OTHERS 421 4 8046.0%