Strategic asset allocation is based on asset/liability reviews carried out to define the most appropriate target portfolio for financing long-term nuclear expenses. Strategic allocation is validated by EDF’s Board of Directors and reviewed every three years unless circumstances require otherwise. A new strategic allocation was validated during 2018. This target allocation consists of a yield portfolio, a growth portfolio and a fixed-income portfolio, respectively accounting for 30%, 40% and 30% of the total portfolio. The yield portfolio consists of real estate assets and infrastructure assets; the growth portfolio consists of equities and equity funds (both listed and unlisted); the fixed-income portfolio consists of bonds, debt funds (both listed and unlisted), the CSPE receivable and cash. These portfolios are managed by the Listed Asset Management division and by EDF Invest (formed in 2013 following the decree of 24 July 2013).
The “cash” pocket of the portfolio exists to provide secure coverage for future disbursements related to the purpose of the asset covered, and may be reinforced tactically, particularly when a conservative approach is required in the event of a market crisis.
The CSPE receivable was allocated to dedicated assets on 13 February 2013 (see note 48 to the 2019 consolidated financial statements).
Tactical management of the growth assets and fixed-income assets has several focal areas:
The allocation policy between growth assets and fixed-income assets was developed by the Operational Management Committee (1) on the basis of the economic and financial outlook for each market and geographical area, a review of market appreciation in different markets and market segments, and risk analyses produced by the CRFI Department.
| 31/12/2019 | 31/12/2018 | |
|---|---|---|
| Yield assets | Yield assets 31/12/201919.2% | Yield assets 31/12/201819.3% |
| Growth assets | Growth assets 31/12/201942.1% | Growth assets 31/12/201836.5% |
| Fixed-income assets | Fixed-income assets 31/12/201938.7% | Fixed-income assets 31/12/201844.2% |
| TOTAL | TOTAL31/12/2019100% | TOTAL31/12/2018100% |
At 31 December 2019, the total value of the portfolio was €31,624 million compared to €27,689 million in 2018.
The content of the financial portfolio is also presented in note 48 to the 2019 consolidated financial statements, “Dedicated assets”.
| 31 December 2019 | 31 December 2018 | |||
|---|---|---|---|---|
| Categories | Net book value | Realisable value | Net book value | Realisable value |
| CTE (the holding company that holds 100% of RTE) (2) | CTE (the holding company that holds 100% of RTE) (2)31 December 20192,705 | CTE (the holding company that holds 100% of RTE) (2)31 December 20182,926 | 2,705 | 2,738 |
| Derivatives | Derivatives 31 December 2019(10) | Derivatives 31 December 2018(10) | - | - |
| Other unlisted securities | Other unlisted securities 31 December 20192,826 | Other unlisted securities 31 December 20183,164 | 2,333 | 2,618 |
| YIELD ASSETS | YIELD ASSETS31 December 20195,521 | YIELD ASSETS31 December 20186,080 | 5,038 | 5,356 |
| Funds not exclusively invested in OECD bonds | Funds not exclusively invested in OECD bonds 31 December 201910,865 | Funds not exclusively invested in OECD bonds 31 December 201812,978 | 9,370 | 9,844 |
| Hedges, deposits, amounts receivable | Hedges, deposits, amounts receivable 31 December 2019- | Hedges, deposits, amounts receivable 31 December 201846 | 20 | 45 |
| Other unlisted securities | Other unlisted securities 31 December 2019263 | Other unlisted securities 31 December 2018276 | 198 | 219 |
| GROWTH ASSETS | GROWTH ASSETS31 December 201911,128 | GROWTH ASSETS31 December 201813,300 | 9,588 | 10,108 |
| OECD government bonds and similar | OECD government bonds and similar 31 December 20194,338 | OECD government bonds and similar 31 December 20184,548 | 4,362 | 4,443 |
| OECD corporate (non-government) bonds | OECD corporate (non-government) bonds 31 December 20191,793 | OECD corporate (non-government) bonds 31 December 20181,827 | 946 | 950 |
| Funds investing in the above two categories | Funds investing in the above two categories 31 December 20194,830 | Funds investing in the above two categories 31 December 20185,038 | 4,580 | 4,647 |
| CSPE after funding | CSPE after funding 31 December 2019684 | CSPE after funding 31 December 2018688 | 2,060 | 2,080 |
| Other unlisted securities | Other unlisted securities 31 December 2019146 | Other unlisted securities 31 December 2018142 | 114 | 105 |
| Derivatives | Derivatives 31 December 20195 | Derivatives 31 December 20181 | - | - |
| FIXED INCOME ASSETS | FIXED INCOME ASSETS31 December 201911,796 | FIXED INCOME ASSETS31 December 201812,244 | 12,062 | 12,225 |
| TOTAL DEDICATED ASSETS | TOTAL DEDICATED ASSETS31 December 201928,445 | TOTAL DEDICATED ASSETS31 December 201831,624 | 26,688 | 27,689 |
(1) Net book value in the parent company financial statements.
(2) In 2019 and 2018, dedicated assets include 50.1% of Coentreprise de Transport d’Électricité (CTE).
(1) A permanent Internal Committee for evaluation, consultation and operational decision-making in the management of dedicated assets.
