References in this annual report on Form 20-F to pages and sections of the ~~2017~~2018 Registration Document are references only to those pages and sections of TOTAL’s Registration Document for the year ended December 31, ~~2017~~2018 attached in Exhibit 15.1 to this Form 20-F. Other than as expressly provided herein, the ~~2017~~2018 Registration Document is not incorporated herein by reference.

TOTAL’s Consolidated Financial Statements, which start on page ~~233~~249 of the ~~2017~~2018 Registration Document and are incorporated herein by reference, are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and IFRS as adopted by the European Union (EU) as of December 31, ~~2017.~~2018.

In addition, this annual report on Form 20-F and the ~~2017~~2018 Registration Document contain certain measures that are not defined by generally accepted accounting principles (GAAP) such as IFRS. Our management uses these financial measures, along with the most directly comparable GAAP financial measures, in evaluating our operating performance. We believe that presentation of this information, along with comparable GAAP measures, is useful to investors because it allows investors to understand the primary method used by management to evaluate performance on a meaningful basis. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP. Non-GAAP financial measures as reported by us may not be comparable with similarly titled amounts reported by other companies.

Statements regarding competitive position

Unless otherwise indicated, statements made in "“Item 4. Information on the ~~company”~~company" referring to TOTAL’s competitive position are based on the Company’s estimates, and in some cases rely on a range of sources, including investment analysts’ reports, independent market studies and TOTAL’s internal assessments of market share based on publicly available information about the financial results and performance of market participants.

Additional information

This annual report on Form 20-F reports information primarily regarding TOTAL’s business, operations and financial information relating to the fiscal year ended December 31, ~~2017.~~2018. For more recent updates regarding TOTAL, you may inspect any reports, statements or other information TOTAL files with the United States Securities and Exchange Commission ~~(“SEC”~~("SEC"). All of TOTAL’s SEC filings made after December 31, 2001 are available to the public at the SEC website at http://www.sec.gov and from certain commercial document retrieval services. See also “"Item 10. –- 10.8 Documents on ~~display”~~display".

No material on the TOTAL website forms any part of this annual report on Form 20-F. References in this ~~document~~annual report on Form 20-F to documents on the TOTAL website are included as an aid to ~~their~~the location of such documents and such documents are not incorporated by ~~reference into this document.~~reference.

Certain terms, abbreviations and conversion table

For the meanings of certain terms used in this document, as well as certain abbreviations and a conversion table, refer to the ~~“Glossary”~~"Glossary" starting on page ~~405~~423 of the ~~2017~~2018 Registration Document, which is incorporated herein by reference.

Cautionary statement concerning forward-looking statements

TOTAL has made certain forward-looking statements in this document and in the documents referred to in, or incorporated by reference into, this annual report. Such statements are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of the management of TOTAL and on the information currently available to such management. Forward-looking statements include information concerning forecasts, projections, anticipated synergies, and other information concerning possible or assumed future results of TOTAL, and may be preceded by, followed by, or otherwise include the words ~~“believes”~~"believes", ~~“expects”~~"expects", ~~“anticipates”~~"anticipates", ~~“intends”~~"intends", ~~“plans”~~"plans", ~~“targets”~~"targets", ~~“estimates”~~"estimates" or similar expressions.

Forward-looking statements are not assurances of results or values. They involve risks, uncertainties and assumptions. TOTAL’s future results and share value may differ materially from those expressed in these forward-looking statements. Many of the factors that will determine these results and values are beyond TOTAL’s ability to control or predict. Except for its ongoing obligations to disclose material information as required by applicable securities laws, TOTAL does not have any intention or obligation to update forward-looking statements after the distribution of this document, even if new information, future events or other circumstances have made them incorrect or misleading.

Various factors, certain of which are discussed elsewhere in this document and in the documents referred to in, or incorporated by reference into, this document, could affect the future results of TOTAL and could cause actual results to differ materially from those expressed in such forward-looking statements, including:

-material adverse changes in general economic conditions or in the markets served by TOTAL, including changes in the prices of oil, natural gas, refined products, petrochemical products and other chemicals;

-changes in currency exchange rates and currency devaluations;

-the success and the economic efficiency of oil and natural gas exploration, development and production programs, including, without limitation, those that are not controlled and/or operated by TOTAL;

-uncertainties about estimates of changes in proven and potential reserves and the capabilities of production facilities;

-uncertainties about the ability to control unit costs in exploration, production, refining and marketing (including refining margins) and chemicals;

-changes in the current capital expenditure plans of TOTAL;

-the ability of TOTAL to realize anticipated cost savings, synergies and operating efficiencies;

-the financial resources of competitors;

-changes in laws and regulations, including tax and environmental laws and industrial safety regulations;

~~Total~~- ~~- Form 20-F 2017 - i~~

~~Back to Contents~~

the quality of future opportunities that may be presented to or pursued by TOTAL;

Back to ContentsForm 20-F 2018 TOTAL i

-the ability to generate cash flow or obtain financing to fund growth and the cost of such financing and liquidity conditions in the capital markets generally;

-the ability to obtain governmental or regulatory approvals;

-the ability to respond to challenges in international markets, including political or economic conditions (including national and international armed conflict) and trade and regulatory matters (including actual or proposed sanctions on companies that conduct business in certain countries);

-the ability to complete and integrate appropriate acquisitions, strategic alliances and joint ventures;

-changes in the political environment that adversely affect exploration, production licenses and contractual rights or impose minimum drilling obligations, price controls, nationalization or expropriation, and regulation of refining and marketing, chemicals and power generating activities;

-the possibility that other unpredictable events such as labor disputes or industrial accidents will adversely affect the business of TOTAL; and

-the risk that TOTAL will inadequately hedge the price of crude oil or finished products.

For additional factors, please refer to “"Item 3. –- 3.2 Risk factors”", “"Item 5. Operating and financial review and prospects”" and “"Item 11. Quantitative and qualitative disclosures about market ~~risk”~~risk".

~~Total~~ ~~- Form 20-F 2017 - ii~~

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Form 20-F 2018 TOTAL ii

ITEM 1. ~~IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS~~Identity of directors, senior management and advisers

Not applicable.

ITEM 2. ~~OFFER STATISTICS AND EXPECTED TIMETABLE~~Offer statistics and expected timetable

Not applicable.

ITEM 3. ~~KEY INFORMATION~~Key information

3.1

Selected financial data

The following table presents selected consolidated financial data for TOTAL on the basis of IFRS as issued by the IASB and IFRS as adopted by the EU for the years ended December 31, 2018, 2017, 2016, 2015 ~~2014~~ and ~~2013.~~2014. Effective January 1, 2014, TOTAL changed the presentation currency of the Group’s Consolidated Financial Statements from the Euro to the US Dollar. Comparative 2013 information in the table below has been restated. Following the retrospective application of the accounting interpretation IFRIC 21 effective January 1, 2014, the information for 2013 has been restated; however, the impact on such restated results is not significant. ERNST & YOUNG Audit and KPMG Audit, a division of KPMG S.A., independent registered public accounting firms and the Company’s auditors, audited the historical Consolidated Financial Statements of TOTAL for these periods from which the financial data presented below for such periods are derived. All such data should be read in conjunction with the Consolidated Financial Statements and the Notes thereto starting on page ~~233~~249 of the ~~2017~~2018 Registration Document, which are incorporated herein by reference.

(M$, except share and per share data)^(a)	2017	2016	2015	2014	2013	2018	2017	2016	2015	2014
INCOME STATEMENT DATA
Revenues from sales	149,099	127,925	143,421	212,018	227,969	184,106	149,099	127,925	143,421	212,018
Net income, Group share	8,631	6,196	5,087	4,244	11,228	11,446	8,631	6,196	5,087	4,244
Earnings per share ($)	$3.36	$2.52	$2.17	$1.87	$4.96	$4.27	$3.36	$2.52	$2.17	$1.87
Fully diluted earnings per share ($)	$3.34	$2.51	$2.16	$1.86	$4.94	$4.24	$3.34	$2.51	$2.16	$1.86
CASH FLOW STATEMENT DATA
Cash flow from operating activities	22,319	16,521	19,946	25,608	28,513	24,703	22,319	16,521	19,946	25,608
Total expenditures	16,896	20,530	28,033	30,509	34,431	22,185	16,896	20,530	28,033	30,509
BALANCE SHEET DATA
Total assets	242,631	230,978	224,484	229,798	239,223	256,762	242,631	230,978	224,484	229,798
Non-current financial debt	41,340	43,067	44,464	45,481	34,574	40,129	41,340	43,067	44,464	45,481
Non-controlling interests	2,481	2,894	2,915	3,201	3,138	2,474	2,481	2,894	2,915	3,201
Shareholders’ equity – Group share	111,556	98,680	92,494	90,330	100,241
Common shares	7,882	7,604	7,670	7,518	7,493
Shareholders’ equity - Group share						115,640	111,556	98,680	92,494	90,330
- Common shares						8,227	7,882	7,604	7,670	7,518
DIVIDENDS
Dividend per share (€)	€2.48 ^(b)	€2.45	€2.44	€2.44	€2.38	€2.56^(a)	€2.48	€2.45	€2.44
Dividend per share ($)	$2.96^(b)(c)	$2.61	$2.67	$2.93	$3.24	$2.94^{(a) (b)}	$2.96	$2.61	$2.67	$2.93
COMMON SHARES^(d)(c)
Average number outstanding of common shares €2.50 par value (shares undiluted)	2,481,802,636	2,379,182,155	2,295,037,940	2,272,859,512	2,264,349,795	2,607,456,934	2,481,802,636	2,379,182,155	2,295,037,940	2,272,859,512
Average number outstanding of common shares €2.50 par value (shares diluted)	2,494,756,413	2,389,713,936	2,304,435,542	2,281,004,151	2,271,543,658	2,623,716,444	2,494,756,413	2,389,713,936	2,304,435,542	2,281,004,151
(a) Following the retrospective application of the accounting interpretation IFRIC 21 effective January 1, 2014, the information for 2013 has been restated; however, the impact on such restated results is not significant. (b) Subject to approval by the shareholders’ meeting on June 1, 2018. (c) Estimated dividend in dollars includes the first quarterly interim ADR dividend of $0.73 paid in October 2017 and the second quarterly interim ADR dividend of $0.75 paid in January 2018, as well as the third quarterly interim ADR dividend of $0.74 payable in April 2018 and the proposed final interim ADR dividend of $0.74 payable in June 2018, both converted at a rate of $1.20/€. (d) The number of common shares shown has been used to calculate per share amounts.

(a) Subject to approval by the shareholders’ meeting on May 29, 2019.

~~Total~~ ~~- Form 20-F 2017 - 1~~(b) Estimated dividend in dollars includes the first quarterly interim ADR dividend of $0.74 paid in October 2018 and the second quarterly interim ADR dividend of $0.74 paid in January 2019, as well as the third quarterly interim ADR dividend of $0.73 payable in April 2019 and the proposed final interim ADR dividend of $0.73 payable in June 2019, both converted at a rate of $1.15/€.

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Form 20-F 2018 TOTAL 1

3.2

Risk factors

The Group and its businesses are subject to various risks relating to changing competitive, economic, political, legal, social, industry, business and financial conditions, including changes in such conditions. Point 3.1 (“("Risk ~~factors”~~factors") of chapter 3 of the ~~2017~~2018 Registration Document (starting on page 74) is incorporated herein by reference.

For additional information on these conditions, along with TOTAL’s approaches to managing certain of these risks, please refer to "“Item 5. Operating and financial review and ~~prospects”~~prospects" and "“Item 11. Quantitative and qualitative disclosures about market ~~risk”~~risk", as well as points 3.3 (“("Internal control and risk management ~~procedures”~~procedures") and 3.5 (“("Vigilance ~~Plan”~~Plan") of chapter 3 (starting on pages 8886 and ~~96,~~93, respectively) of the ~~2017~~2018 Registration Document, which are incorporated herein by reference.

ITEM 4. ~~INFORMATION ON THE COMPANY~~

~~History and development~~

~~Business overview~~

~~Other matters~~ Information on the company

The following information providing an integrated overview of the Group from the ~~2017~~2018 Registration Document is incorporated herein by reference:

-presentation of the Group and its governance (point 1.1 of chapter 1, starting on page 4);

-the Group’s collective ambition and strategy (point 1.2 of chapter 1, on page 9);

-history, employees, integrated business model and geographic presence (point 1.3 of chapter 1, starting on page 10);

-an overview of the Group’s R&D, investment policy and sustainable development initiatives (point 1.5 of chapter 1, on page 23); and

-organizational structure (point 1.6 of chapter 1, starting on page 26).

The following information providing an overview of the Group’s businesses and activities from the ~~2017~~2018 Registration Document is incorporated herein by reference:

-business overview for fiscal year ~~2017~~2018 (points 2.1 to 2.4 of chapter 2, starting on page 3032);

-information concerning the Group’s principal capital expenditures and divestitures (point 2.5 of chapter 2, starting on page 68). See also "“Item 5. Operating and financial review and ~~prospects”~~prospects"; and

-geographical breakdown of the Group’s sales, property, plants and equipment, intangible assets and capital expenditures over the past three years (Note 4 to the Consolidated Financial Statements, on page ~~259~~276).

The following other information from the ~~2017~~2018 Registration Document is incorporated herein by reference:

-insurance policy (point 3.4 of chapter 3, starting on page 9592);

~~social, environmental and societal information (introduction and points 5.1.3~~-non-financial performance (points 5.1 to ~~5.4~~5.11 of chapter 5, starting on page ~~170~~179); and

-investor relations (point 6.6 of chapter 6, starting on page ~~223~~239).

ITEM 4A. ~~UNRESOLVED STAFF COMMENTS~~Unresolved staff comments

None.

ITEM 5. ~~OPERATING AND FINANCIAL REVIEW AND PROSPECTS~~Operating and financial review and prospects

ThissectionistheCompany’sanalysisofitsfinancialperformanceandofsignificanttrendsthatmayaffectitsfutureperformance.ItshouldbereadinconjunctionwiththeConsolidatedFinancialStatementsandtheNotestheretointhe~~2017~~ 2018 RegistrationDocument~~(starting~~ (starting onpage ~~233~~249),whichareincorporatedhereinbyreference.TheConsolidatedFinancialStatementsandtheNotestheretoarepreparedinaccordancewithIFRSasissuedbytheIASBandIFRSasadoptedbytheEU.

This section contains forward-looking statements that are subject to risks and uncertainties. For a list of important factors that could cause actual results to differ materially from those expressed in the forward-looking statements, see ~~“Cautionary~~"Cautionary Statement Concerning Forward-Looking ~~Statements”~~Statements" starting on page i.

Critical accounting policies and standards applicable in the future

ForanoverviewofTOTAL’scriticalaccountingpolicies,includingpoliciesinvolvingmanagement’sjudgmentandestimates and significant accounting policies applicable in the future, refertotheIntroduction and Note 1.2 ("Significant accounting policies applicable in the future") of the Notes tothe~~Notes~~to Consolidated Financial Statements in the~~Consolidated~~~~Financial~~~~Statements~~in~~the~~~~2017~~ 2018 RegistrationDocument~~(starting~~ (starting on~~page 244~~pages 260) and 262, respectively), whichisincorporatedhereinbyreference.

5.1

Overview

TOTAL’s results are affected by a variety of factors, including changes in crude oil and natural gas prices as well as refining and marketing margins, which are all generally expressed in dollars, and changes in exchange rates, particularly the value of the euro compared to the dollar. Higher crude oil and natural gas prices generally have a positive effect on the income of TOTAL, since the Exploration & Production ~~segment's~~segment’s oil and gas business and Gas, Renewables & Power segment’s downstream gas business are positively impacted by the resulting increase in revenues. Lower crude oil and natural gas prices generally have a corresponding negative effect. The effect of changes in crude oil prices on the activities of TOTAL’s Refining & Chemicals and Marketing & Services segments depends upon the speed at which the prices of refined petroleum products adjust to reflect such changes. TOTAL’s results are also significantly affected by the costs of its activities, in particular those related to exploration and production, and by the outcome of its strategic decisions with respect to cost reduction efforts. In addition, ~~TOTAL’s~~

~~Total~~ ~~- Form 20-F 2017 - 2~~

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Form 20-F 2018 TOTAL 2

TOTAL’s results are affected by general economic and political conditions and changes in governmental laws and regulations, as well as by the impact of decisions by OPEC on production levels. For more information, refer to “"Item 3. –- 3.2 Risk ~~factors”~~factors".

~~The Brent price rose~~Benefiting from the rise of oil prices to ~~$54/~~$71/b on average in ~~2017 from $44/~~2018 compared to $54/b in ~~2016~~2017, while remaining ~~volatile. The~~volatile, the Group ~~demonstrated its ability to capture the benefit~~reported adjusted net income of ~~higher prices and reported~~$13.6 billion in 2018, an increase of 28%, a return on ~~equity above 10%~~average capital employed close to 12%, the highest among the ~~majors. The~~majors, and a pre-dividend breakeven below $30/b.

These excellent results reflect the strong growth of more than 8% for the Group’s hydrocarbon production, which reached a record level of 2.8 Mboe/d in 2018 and led to a 71% increase in Exploration & ~~Production segment, in particular, increased its~~Production’s adjusted net operating ~~income~~income. The year was highlighted by ~~approximately 86%~~the start-up of Ichthys in Australia, Yamal LNG in Russia, deep-water projects Kaombo Norte in Angola and ~~its operating cash flow before working capital changes at replacement cost~~⁽¹⁾ ~~by 38% whereas oil prices only increased by 24%.~~Egina in Nigeria, as well as the counter-cyclical acquisitions of Maersk Oil and new offshore licenses in the United Arab Emirates.

TOTAL’s net income (Group share) in ~~2017~~2018 increased by ~~39%~~33% to $11,446 million in 2018 compared to $8,631 million ~~from $6,196 million~~ in ~~2016,~~2017, mainly due to higher hydrocarbon prices and growth of the Group’s production. Adjustments to net income (Group share), which include the after-tax inventory effect, special items and the ~~after-tax inventory valuation effect,~~impact of changes in fair value, had a negative impact of ~~$1,947~~$2,113 million in ~~2017.~~2018. Excluding these items, as mentioned above, adjusted net income (Group share) increased by 28% ~~(compared~~ to ~~a 24% increase~~$13,559 million in ~~Brent)~~2018, compared to $10,578 million in 2017, ~~compared to $8,287 million~~ in ~~2016, due to a much higher~~line with the contribution from ~~Exploration & Production and~~ the ~~continued decrease in the Group’s breakeven.~~segments. For additional information, refer to “–"- 5.2 Group results ~~2015-2017”~~2016-2018" and "- “–  5.3 Business segment ~~reporting”~~reporting~~Operating cash flow excluding~~", below.

In addition, the ~~change~~Group maintained its financial discipline. Net investments⁽¹⁾ were $15.6 billion in ~~working, below.~~

~~Financial discipline was successfully maintained. Organic investments were $14.4 billion (excluding acquisitions),~~2018, in line with ~~the Group’s target of $13-15 billion,~~its objective, and ~~cost savings reached $3.7~~$4.2 billion in ~~2017, more than~~cost reduction was achieved. Debt adjusted cash flow (DACF)⁽²⁾ was $26 billion in 2018, driven largely by the 31% increase in cash flow from Exploration & Production. The Group’s balance sheet was solid with a gearing⁽³⁾ ratio of 15.5%, below the target limit of ~~$3.5 billion. Production costs~~⁽²⁾ ~~fell~~20%.

The Group is continuing to ~~$5.4/boe~~expand along the value chain of integrated gas and low-carbon electricity. With its acquisition of Engie’s LNG assets TOTAL is the second largest publicly-traded player in ~~2017 from $9.9/boe in 2014.~~

~~These strong results were driven by production growth (5% in 2017), notably~~ the LNG business, and its position will be strengthened with the 2019 start-up of the ~~Moho-Nord~~Cameron LNG project. In addition, the Group accelerated its growth in low-carbon electricity, notably with the ~~Republic~~acquisition of Direct Énergie.

In an environment of lower European refining margins, the ~~Congo,~~Downstream relied on the ~~ramp-up~~availability of ~~Kashagan in Kazakhstan~~its units and the ~~entry into Al Shaheen in Qatar. The Downstream~~⁽³⁾ ~~confirmed again this year~~diversity of its ~~ability~~portfolio to generate ~~about $7~~$6.5 billion of ~~operating~~ cash flow ~~before working capital changes at replacement cost~~ and ~~reported a return on capital employed~~profitability of more than ~~30%~~25%.

~~In 2017, the~~ The Group ~~took advantage of the cyclical low~~is continuing to ~~launch five Upstream projects, including the first phase of the Libra development~~implement its strategy for growth in ~~Brazil, as well as~~petrochemicals by launching ~~petrochemical~~ projects in the United States, Saudi Arabia, South Korea and ~~South Korea.~~Algeria. TOTAL has also continued to expand Marketing & Services in fast-growing areas, notably in Mexico, Brazil and Angola.

Conforming to the shareholder return policy announced in February 2018, the Group increased the 2018 dividend by 3.2% and bought back $1.5 billion of its shares in 2018. Given the solid financial position, which is benefiting from growing cash flow, the Board of Directors confirmed the shareholder return policy for 2019. It plans to increase the interim dividend by 3.1% to 0.66 euros per share, end the scrip dividend option following the general assembly meeting, and continue the share buyback policy in the amount of $1.5 billion in a $60/b environment.

Outlook

Since the start of 2019, Brent has traded around $60/b in a context of oil supply and demand near the record-high level of 100 Mb/d. In a volatile environment, the Group is pursuing its strategy for integrated growth along the oil, gas and low-carbon electricity chains.

The Group has clear visibility on its 2019 cash flow, supported by the strong contribution of project start-ups in 2018 and recent acquisitions.

The Group maintains financial discipline to reduce its breakeven to remain profitable across a broader range of environments. In particular, it is targeting cost reductions of $4.7 billion, projected net investments of $15-16 billion in 2019 and an Opex target of $5.5/boe.

In Exploration & Production, segment, the Group is preparing for future growth with the acquisition of Mærsk Oil, strengthening its position in the North Sea, and finalized its entry into the Lapa and lara fields in Brazil in early 2018. In the U.S. Gulf of Mexico, the Group participated in a major discovery at the Ballymore prospect. In the framework of reinforcing its integrated gas strategy, it announced the acquisition of the LNG business of Engie to take full advantage of the fast-growing LNG market. Marketing & Services continues to grow, notably by expanding its retail network into Mexico.

~~The strategy implemented since 2015 has enabled the Group to reduce its pre-dividend organic breakeven~~⁽⁴⁾ ~~to $27/b in 2017 and generate $22 billion of debt-adjusted cash flow (“DACF”)~~⁽⁵⁾~~. The Group also continued to strengthen its balance sheet, ending the year with a 13.8% gearing~~⁽⁶⁾~~, a significant decrease compared to 2016.~~

~~Outlook~~

Since the end of 2017, Brent has been trading between $60/b and $70/b, supported by strong demand (+1.6 Mb/d in 2017), extended production cuts by OPEC and Russia and a decrease in crude oil inventories, which nevertheless remain higher than the past five-year average, which could contribute to continuing price volatility. The Group maintains its strategy to cut costs with the objective of achieving over $4 billion of cost savings in 2018 and production costs of $5.5/boe. Organic investments are targeted at around $14 billion in 2018.

~~The Exploration & Production segment’s~~ production is expected to ~~increase by 6% in 2018, confirming the objective to~~ grow by ~~5% per year on average between 2016~~more than 9% in 2019, thanks to the ramp-ups of Kaombo Norte, Egina and ~~2022. As a result~~Ichthys plus the start-ups of ~~this expected growth and the portfolio mix, the Group’s cash flow sensitivity to a $10/b change~~Iara 1 in Brazil, Kaombo South in Angola, Culzean in the ~~price of Brent increases to $2.8 billion~~UK and Johan Sverdrup in ~~2018 from $2.5 billion in 2017. The Group intends~~Norway. Determined to take advantage of the favorable cost environment, ~~by continuing~~the Group plans to launch projects in ~~2018.~~ 2019, notably including Mero 2 in Brazil, Tilenga and Kingfisher in Uganda and Arctic LNG 2 in Russia.

The ~~growing demand~~Group is pursuing its strategy for ~~LNG supports the Group’s strategy to develop~~profitable growth along the integrated gas ~~value chain, as illustrated~~and low-carbon electricity chains. Effective 2019, the Group will report the new iGRP segment (integrated Gas, Renewables & Power) which combines the Gas, Renewables & Power segment with the upstream gas and LNG activities currently reported within the Exploration & Production segment.

Affected by ~~the announced acquisition~~an abundance of ~~Engie’s LNG portfolio.~~

~~In the context of sharply higher oil prices, rising refined product inventories, due to high global refining utilization rates, and seasonally weak winter demand,~~available products, European refining margins have ~~decreased~~been very volatile since ~~December 2017. Despite~~ the ~~current weakness in refining margins,~~start of the year. In 2019, the Downstream ~~is expected~~will continue to ~~generate $7 billion of operating cash flow before working capital changes at replacement cost once again in 2018.~~rely on its diversified portfolio, notably its integrated Refining & ~~Chemicals continues to expand its high-return integrated~~Chemical platforms ~~notably~~ in the ~~United States~~U.S. and in Asia-Middle ~~East.~~East as well as its non-cyclical Marketing & Services ~~continues to pursue its growth strategy in high-potential markets.~~segment.

~~The Group’s pre-dividend organic breakeven is continuing to fall, with an objective of $25/b in 2018.~~

~~(1)~~

Operating cash flow excluding the change in working capital at replacement cost provides information on underlying cash flow without the short-term impacts of changes in inventory and other working capital elements at replacement cost. For information on the replacement cost method, refer to “—  ~~5.3  Business segment reporting”~~ ~~and Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on~~ ~~page 247), which is incorporated herein by reference.~~

~~(2)~~

~~“Production costs” = costs related to the production of hydrocarbons in accordance with FASB ASC 932-360-25-15.~~

~~(3)~~

~~Refining & Chemicals and Marketing & Services segments.~~

~~(4)~~

~~Barrel price permitting the generation of cash flow that is equal to organic investments.~~

~~(5)~~

DACF = operating cash flow excluding both the change in working capital at replacement cost and financial charges. It provides a measure of cash flow generated by the Group’s activities regardless of its financial structure.

~~(6)~~

“Gearing” refers to the net-debt-to-equity ratio. “Net-debt-to-equity ratio” = (net debt)/(adjusted shareholders’ equity). For additional information, refer to Note 15.1(E) to the Consolidated Financial Statements in the 2017 Registration Document (on ~~page 307), which is incorporated herein by reference.~~

~~Total~~ ~~- Form 20-F 2017 - 3~~

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After a period of heavy investment, the Group’s cash flow generation is growing strongly, driven by an increase in production that is at the best level among the majors. The Group has taken advantage of the low part of the oil price cycle to acquire high-quality resources at attractive prices and emerge stronger with better visibility on its cash flow generation and a net-debt-to-equity ratio below 20%⁽¹⁾. In this context, the ~~Board of Directors~~Group is ~~proposing a~~continuing to implement its shareholder return policy ~~for~~announced in February 2018, by increasing the ~~coming three years comprised~~dividend in 2019 by 3.1%, in line with the objective to increase the dividend by 10% over the 2018-20 period. Taking into account its strong financial position, the Group will eliminate the scrip dividend option from June 2019. Within the framework of ~~dividend increases and share buybacks~~its program to buy back $5 billion of shares over the 2018-20 period, the Group expects to buy back $1.5 billion of its shares in 2019 in a $60/b Brent environment (for additional information concerning the Group’s dividends and dividend policy, refer to point 6.2 of chapter 6 (starting on page ~~213~~229) of the ~~2017~~2018 Registration Document, which is incorporated herein by reference).

(1) Net investments = gross investments - divestments - repayment of non-current loans - other operations with non-controlling interests.

(2) DACF= debt adjusted cash flow, is defined as cash flow from operating activities before changes in working capital at replacement cost, without financial charges.

(3) "Gearing" refers to the net-debt-to-capital-ratio. "Net-debt-to-capital-ratio"= net debt/ (net debt + shareholders’ equity). For additional information, refer to Note 15.1(E) ("Net-debt-to-capital ratio") to the Consolidated Financial Statements in the 2018 Registration Document (on page 325), which is incorporated herein by reference.

Back to ContentsForm 20-F 2018 TOTAL 3

5.2

Group results ~~2015-2017~~2016-2018

As of and for the year ended December 31, (M$, except per share data)
2018
2017
2016
Non-Group sales
209,363
171,493
149,743
Adjusted net operating income from business segments ^(a)
- Exploration & Production
10,210
5,985
3,217
- Gas, Renewables & Power
756
485
439
- Refining & Chemicals
3,379
3,790
4,195
- Marketing & Services
1,652
1,676
1,559
Net income (loss) from equity affiliates
3,170
2,015
2,214
Fully-diluted earnings per share ($)
4.24
3.34
2.51
Fully-diluted weighted-average shares (millions)
2,624
2,495
2,390
Net income (Group share)
11,446
8,631
6,196
Gross investments ^(b)
22,185
16,896
20,530
Divestments ^(c)
7,239
5,264
2,877
Net investments ^(d)
15,568
11,636
17,757
Organic investments ^(e)
12,426
14,395
17,484
Resource acquisitions^(f)
4,493
714
780
Cash flow from operating activities
24,703
22,319
16,521
Of which:
.
- (increase)/decrease in working capital ^(g)
769
827
(1,119)
- financial charges
(1,538)
(1,048)
(593)
(a) Adjusted results are defined as income using replacement cost, adjusted for special items, excluding the impact of changes in fair value. See "- 5.3 Business segment reporting" below for further details.
(b) Including acquisitions and increases in non-current loans. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(c) Including divestments and reimbursements of non-current loans.
(d) "Net investments" = gross investments - divestments - repayment of non-current loans - other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(e) "Organic investments" = net investments, excluding acquisitions, divestments and other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(f) "Resource acquisitions"= acquisition of a participating interest in an oil and gas mining property by way of an assignment of rights and obligations in the corresponding permit or license and related contracts, with a view to producing the recoverable oil and gas.
(g) The change in working capital as determined using the replacement cost method was $174 million in 2018, $1,184 million in 2017 and $(467) million in 2016. For information on the replacement cost method, refer to Note 3 ("Business segment information") to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
2018 vs. 2017
The Brent price rose to $71/b on average in 2018 from $54/b in 2017, while remaining volatile. In 2018, TOTAL’s average liquids price realization⁽¹⁾ increased by 28% to $64.2/b in 2018 from $50.2/b in 2017. TOTAL’s average gas price realization⁽²⁾ increased by 17% to $4.78/Mbtu in 2018 from $4.08/Mbtu in 2017. The Group’s European Refining Margin Indicator ("ERMI")⁽³⁾ decreased by 21% to $32.3/t on average in 2018 compared to $40.9/t in 2017, mainly due to rising crude oil prices.
The euro-dollar exchange rate averaged $1.1810/€ in 2018, compared to $1.1297/€ in 2017.
Non-Group sales were $209,363 million in 2018 compared to $171,493 million in 2017, an increase of 22% reflecting the increased hydrocarbon prices and Group production. Non-Group sales increased 30% for the Exploration & Production segment, 26% for the Gas, Renewables & Power segment, 22% for the Refining & Chemicals segment and 21% for the Marketing & Services segment.
Net income (Group share) in 2018 increased by 33% to $11,446 million in 2018 compared to $8,631 million in 2017, mainly due to higher hydrocarbon prices and growth of the Group’s production. Adjustments to net income (Group share), which include the after-tax inventory effect, special items and the impact of changes in fair value, had a negative impact of $2,113 million in 2018, mainly due to an inventory effect and an impairment on Ichthys related to the sale of a partial interest by the Group, as well as the impairment of production facilities by SunPower ⁽⁴⁾. For a detailed overview of adjustment items for 2018, refer to Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference. In 2017, adjustments to net income (Group share), which included special items of $(2,213) million and after-tax inventory valuation effect of $282 million, had a negative impact on net income (Group share) of $1,947 million. Special items in 2017 included mainly an impairment of Fort Hills in Canada (following the operator announcement of the increase of the project’s costs), Gladstone LNG in Australia and assets in Congo, partially offset by a gain on the sale of Atotech. Excluding these items, adjusted net income increased by 28% to $13,559 million in 2018, compared to $10,578 million in 2017, in line with the contribution from the segments.
Income taxes in 2018 amounted to $6,516 million, 2.2 times higher than $3,029 million in 2017, due to the relative weight and higher tax rates in the Exploration & Production segment in a higher hydrocarbon price environment.
(1) Consolidated subsidiaries, excluding fixed margins.
(2) Consolidated subsidiaries, excluding fixed margins.
(3) The ERMI is a Group indicator intended to represent the margin after variable costs for a hypothetical complex refinery located around Rotterdam in Northern Europe that processes a mix of crude oil and other inputs commonly supplied to this region to produce and market the main refined products at prevailing prices in this region. The indicator margin may not be representative of the actual margins achieved by the Group in any period because of the Group’s particular refinery configurations, product mix effects or other company-specific operating conditions.
(4) As of December 31, 2018, TOTAL held an interest of 55.66% in SunPower, an American company listed on NASDAQ and based in California.
As of and for the year ended December 31,
(M$, except per share data)
2017
2016
2015
Non-Group sales
171,493
149,743
165,357
Adjusted net operating income from business segments^(a)

–
Exploration & Production
5,985
3,217
4,330
–
Gas, Renewables & Power^(b)
485
439
567
–
Refining & Chemicals
3,790
4,195
4,839
–
Marketing & Services
1,676
1,559
1,591
Equity in net income (loss) of affiliates
2,015
2,214
2,361
Fully-diluted earnings per share ($)
3.34
2.51
2.16
Fully-diluted weighted-average shares (millions)
2,495
2,390
2,304
Net income (Group share)
8,631
6,196
5,087
Gross investments^(c)
16,896
20,530
28,033
Divestments
5,264
2,877
7,584
Net investments^(d)
11,636
17,757
20,360
Organic investments^(e)
14,395
17,484
22,976
Resource acquisitions^(f)
714
780
2,808
Cash flow from operating activities
22,319
16,521
19,946
–
Includes (increase)/decrease in working capital^(g)
827
(1,119)
1,683
(a)
Adjusted results are defined as income using replacement cost, adjusted for special items, excluding the impact of changes for fair value. See “– 5.3 Business segment reporting” below for further details.
(b)
Following the Group’s reorganization fully effective as of January 1, 2017, the new Gas, Renewables & Power segment reflects the Group’s ambition in low-carbon energies. It encompasses downstream Gas activities previously integrated in the Upstream (now Exploration & Production) segment, New Energies activities (excluding biotechnologies) previously integrated in the Marketing & Services segment and a new Innovation & Energy Efficiency division. In this Item 5, certain financial information for the Exploration & Production, Refining & Chemicals (which includes a new Biofuels division) and Marketing & Services segments have been restated accordingly.
(c)
“Gross investments” include acquisitions and increases in non-current loans. For additional information on investments, refer to point 2.5 of chapter 2 of the 2017 Registration Document (starting on page 68), which is incorporated herein by reference.
(d)
“Net investments” = gross investments – divestments – repayment of non-current loans – other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2017 Registration Document (starting on page 68), which is incorporated herein by reference.
(e)
“Organic investments” = net investments excluding acquisitions, asset sales and other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2017 Registration Document (starting on page 68), which is incorporated herein by reference.
(f)
“Resource acquisitions”= acquisition of a participating interest in an oil and gas mining property by way of an assignment of rights and obligations in the corresponding permit or license and related contracts, with a view to producing the recoverable oil and gas.
(g)
The change in working capital as determined using the replacement cost method was $1,184 million in 2017, $(467) million in 2016 and $570 million in 2015. For information on the replacement cost method, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
Back to ContentsForm 20-F 2018 TOTAL 4
In 2018, the Company bought back 72,766,481 TOTAL shares on the market, i.e., 2.76% of the Company’s outstanding share capital as of December 31, 2018. See also "- 5.4.4 Shareholders’ equity", below. In 2017, the Company did not buy back any shares.
Fully-diluted earnings per share was $4.24 in 2018 compared to $3.34 in 2017, an increase of 27%.
Asset sales completed were $5,172 million for the full-year 2018, comprised mainly of the sale of a 4% interest in the Ichthys project in Australia and the sale of the Group’s share of the LNG re-gas terminal at Dunkirk, as well as the sale of Joslyn in Canada, Rabi in Gabon, the Martin Linge and Visund fields in Norway, an interest in Fort Hills in Canada, SunPower’s sale of its interest in 8point3, the marketing activities of TotalErg in Italy, the Marketing & Services network in Haiti, and the contribution of the Bayport polyethylene unit in the United States to the joint venture formed with Borealis and Nova in which TOTAL holds 50%. Asset sales were $4,239 million in 2017.
Acquisitions completed were $8,314 million for the full-year in 2018, including $4,493 million in resource acquisitions, comprised of the extension of licenses in Nigeria and the acquisition of a network of service stations in Brazil, as well as notably the acquisitions of Direct Énergie, Engie’s LNG business, the increase in the share of Novatek to 19.4%, interests in the Iara and Lapa fields in Brazil, two new 40-year offshore concessions in Abu Dhabi, which follow the previous Abu Dhabi Marine Areas Ltd (ADMA) offshore concession, and the acquisition of offshore assets from Cobalt in the Gulf of Mexico. Acquisitions were $1,476 million in 2017, including $714 million in resource acquisitions.
The Group’s cash flow from operating activities for the full-year 2018 was $24,703 million, an increase of 11% compared to $22,319 million for the full-year 2017. The change in working capital at replacement cost for the full-year 2018, which is the decrease in working capital of $769 million as determined in accordance with IFRS adjusted for the pre-tax inventory valuation effect of $(595) million, was $174 million compared to $1,184 million for the full-year 2017. Operating cash flow excluding the change in working capital at replacement cost for the full year 2018 was $24,529 million, an increase of 16% compared to $21,135 million for the full-year 2017. Operating cash flow excluding the change in working capital at replacement cost and excluding financial charges (DACF) for the full-year 2018 was $26,067 million, an increase of 18% compared to $22,183 million for the full-year 2017. The Group’s net cash flow⁽¹⁾ was $8,961 million for the full-year 2018 compared to $9,499 million for the full-year 2017, due to an increase of $3,932 million in net investments partially offset by a $3,394 million increase in operating cash flow before changes in working capital.
See also "- 5.4 Liquidity and Capital Resources", below.
2017 vs. 2016
The Brent price rose to $54/b on average in 2017 from $44/b in 2016 while remaining volatile. In 2017, TOTAL’s average liquids price realization⁽²⁾ increased by 25% to $50.2/b from $40.3/b in 2016. TOTAL’s average natural gas price realization for the Group’s consolidated subsidiaries increased by 15% to $4.08/Mbtu in 2017 from $3.56/Mbtu in 2016. The Group’s ~~European Refining Margin Indicator (“ERMI”)~~⁽³⁾ERMI increased to $40.9/t on average in 2017 compared to $34.1/t in 2016, an increase of 20% due to elevated petroleum product demand. In the fourth quarter of 2017, the ERMI was $35.5/t. Petrochemicals continued to benefit from a favorable environment albeit down compared to a year ago.
The euro-dollar exchange rate averaged $1.13/€ in 2017 compared to $1.11/€ in 2016.
In this overall more favorable environment, non-Group sales in 2017 were $171,493 million compared to $149,743 million in 2016, an increase of 15% reflecting the increased hydrocarbon prices and Group production. Non-Group sales increased 11% for the Exploration & Production segment, 27% for the Gas, Renewables & Power segment, 15% for the Refining & Chemicals segment and 12% for the Marketing & Services segment.

~~(1)~~
Excluding the impact of IFRS 16, which is the subject of an ongoing evaluation by a working group formed for that purpose. For information on the transition to IFRS 16, refer to Note 1.2 to the Consolidated Financial Statements in the 2017 Registration Document (on ~~page 246), which is incorporated herein by reference.~~
~~(2)~~
~~Consolidated subsidiaries, excluding fixed margins.~~
~~(3)~~
The ERMI is a Group indicator intended to represent the margin after variable costs for a hypothetical complex refinery located around Rotterdam in Northern Europe that processes a mix of crude oil and other inputs commonly supplied to this region to produce and market the main refined products at prevailing prices in this region. The indicator margin may not be representative of the actual margins achieved by the Group in any period because of the Group’s particular refinery configurations, product mix effects or other company-specific operating conditions.
~~Total~~ ~~- Form 20-F 2017 - 4~~
~~Back to Contents~~
Net income (Group share) in 2017 increased by 39% to $8,631 million from $6,196 million in 2016, mainly due to higher hydrocarbon prices and growth of the Group’s production. In 2017, adjustments to net income (Group share), which included special items of $(2,213) million and after-tax inventory valuation effect of $282 million, had a negative impact on net income (Group share) of $1,947 million. Special items included mainly an impairment of Fort Hills in Canada (following the operator announcement of the increase of the project’s costs), Gladstone LNG in Australia and assets in Congo, partially offset by a gain on the sale of Atotech. ~~For a detailed overview of adjustment items for 2017, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on~~ ~~page 247), which is incorporated herein by reference.~~ In 2016, adjustments to net income (Group share), which included special items of $(2,567) million and after-tax inventory valuation effect of $479 million, had a negative impact on net income (Group share) of $2,091 million. Special items in 2016 included impairments on Gladstone LNG in Australia, Angola LNG, and Laggan-Tormore in the United Kingdom, reflecting the decrease in gas price assumptions for the coming years. Excluding these items, adjusted net income in 2017 increased by 28% to $10,578 million compared to $8,287 million in 2016. The increase was the result of a much higher contribution from Exploration & Production and the continued decrease in the Group’s breakeven.
Income taxes in 2017 amounted to $3,029 million, 3.1 times higher than $970 million in 2016, due to the relative weight and higher tax rates in the Exploration & Production segment in a higher hydrocarbon price environment.
In 2017, the Company did not buy back any of its shares. In 2016, the Company bought back 100,331,268 TOTAL treasury shares owned by Group affiliates under the authorization granted by the shareholders at the meeting of May 24, 2016, which were subsequently canceled by the Company’s Board of Directors.
Fully-diluted earnings per share was $3.34 in 2017 compared to $2.51 in 2016, an increase of 33%.
Asset sales completed in 2017 were $4,239 million, essentially comprised of the sale of Atotech, mature assets in Gabon, Gina Krog in Norway, part of the interest in the Fort Hills project in Canada, the SPMR pipeline in France and LPG activities in Germany. Asset sales completed in 2016 were $1,864 million.
Acquisitions completed in 2017 were $1,476 million, including $714 million of resource acquisitions, mainly comprised of the bonus related to the license for Elk-Antelope in Papua New Guinea, a marketing and logistics network in East Africa and a 23% equity share in Tellurian, Inc. Acquisitions completed in 2016 were $2,033 million, including $780 million of resource acquisitions.
In addition, in early 2018, the Group finalized the acquisition of assets in Brazil from Petrobras for $1.95 billion as well as the sale of TotalErg in Italy for $415 million (including the B2B and the LPG businesses). Finally, in March 2018, TOTAL S.A. finalized the acquisition of Mærsk Oil in a share and debt transaction.
(1) "Net cash flow"= cash flow from operating activities before working capital changes at replacement costs - net investments (including other transactions with non-controlling interests).
Back to ContentsForm 20-F 2018 TOTAL 5
The Group’s cash flow from operating activities for the full-year 2017 was $22,319 million, an increase of 35% compared to $16,521 million in 2016. The change in working capital at replacement cost for the full-year 2017, which is the ~~(increase)/~~decrease in working capital of $827 million as determined in accordance with IFRS adjusted for the pre-tax inventory valuation effect of $357 million, was $1,184 million compared to $(467) million in 2016. Operating cash flow excluding the change in working capital at replacement cost for the full-year 2017 was $21,135 million, an increase of 24% compared to $16,988 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost and without financial charges (DACF) was $22,183 million, an increase of 26% compared to $17,581 million in 2016. The Group’s net cash flow⁽¹⁾ was $9,499 million for the full-year 2017 compared to $(769) million in 2016, mainly due to the nearly $4 billion increase in operating cash flow before working capital changes, the decrease in net investments related to the $3 billion decrease in organic investments and the sale of Atotech.
See also “–"- 5.4 Liquidity and Capital ~~Resources”~~Resources", below.
~~2016 vs. 2015~~
After falling from $100/b in 2014 to $52/b on average in 2015, Brent prices were highly volatile in 2016, fluctuating between $27/b and $58/b, with an average of $44/b for the year. In 2016, TOTAL’s average liquids price realization decreased by 15% to $40.3/b from $47.4/b in 2015. TOTAL’s average natural gas price realization for the Group’s consolidated subsidiaries decreased in 2016 by 25% to $3.56/Mbtu from $4.75/Mbtu in 2015. The ERMI was $34/t in 2016, a 30% decrease compared to the high levels in 2015 ($48.5/t), in the context of high petroleum stocks. The environment for petrochemicals remained favorable.
~~The Euro remained stable in 2016 compared to the US Dollar, with the euro-dollar exchange rate averaging $1.11/€ in 2016 and 2015.~~
In this overall less favorable environment, non-Group sales in 2016 were $149,743 million, a decrease of 9% compared to $165,357 million for 2015. The decrease in hydrocarbon prices and refining margins were partially offset by production growth and strong results for petrochemicals.
Net income (Group share) in 2016 increased by 22% to $6,196 million from $5,087 million in 2015, mainly due to a less negative impact on net income (Group share) in 2016 of special items (as further discussed below), with the Group demonstrating its resilience despite the 19% drop in hydrocarbon prices due to the strength of its integrated model and commitment of its teams to reducing the breakeven. In 2016, adjustments to net income (Group share), which included special items of $(2,567) million and after-tax inventory valuation effect of $479 million, had a negative impact on net income (Group share) of $2,091 million in 2016. Special items included impairments on Gladstone LNG in Australia, Angola LNG, and Laggan-Tormore in the United Kingdom, reflecting the decrease in gas price assumptions for the coming years. In 2015, adjustment items, which included special items of $(4,675) million and after-tax inventory valuation effect of $(747) million, had a negative impact on net income (Group share) of $5,431 million. Special items included impairments on Fort Hills in Canada and Gladstone LNG in Australia as well as in Libya, an adjustment to depreciation on Usan in Nigeria following the cancellation of the sale process and the impairment of exploration projects that will not be developed. Excluding these items, adjusted net income declined by 21% to $8,287 million in 2016 compared to $10,518 million in 2015, primarily due to the impact of lower Brent prices, partially offset by the contribution from downstream activities.
Income taxes in 2016 amounted to $970 million, a decrease of 41% compared to $1,653 million in 2015, due to the relative weight and lower tax rates in Exploration & Production in a lower hydrocarbon price environment.
In 2016, the Company bought back 100,331,268 TOTAL treasury shares owned by Group affiliates under the authorization granted by the shareholders at the meeting of May 24, 2016, which were subsequently canceled by the Company’s Board of Directors. TOTAL bought back approximately 4.7 million of its own shares in 2015 (~~i.e.~~~~, approximately 0.19% of the share capital as of December 31, 2015) under the~~

~~(1)~~
~~“Net cash flow” = operating cash flow before working capital changes at replacement cost – net investments (including other transactions with non-controlling interests).~~
~~Total~~ ~~- Form 20-F 2017 - 5~~
~~Back to Contents~~
authorization granted by the shareholders at the meeting of May 29, 2015. The number of fully-diluted shares at December 31, 2016, was 2,436 million compared to 2,336 million at December 31, 2015.
~~Fully-diluted earnings per share was $2.51 in 2016 compared to $2.16 in 2015, an increase of 16%.~~
Asset sales completed in 2016 were $1,864 million, mainly comprised of the sale of a 15% interest in the Gina Krog field in Norway, the FUKA gas pipeline network in the North Sea and the retail network in Turkey. Asset sales completed in 2015 $5,968 million.
Acquisitions completed in 2016 were $2,033 million, including $780 million of resource acquisitions, mainly comprised of the additional 75% interest in the Barnett shale gas field in the United States, and the acquisitions of Saft, Lampiris and a retail network in the Dominican Republic. Acquisitions completed in 2015 were $3,441 million, including $2,808 million of resource acquisitions.
The Group’s cash flow from operating activities for the full-year 2016 was $16,521 million, a decrease of 17% compared to $19,946 million in 2015. The change in working capital at replacement cost for the full-year 2016, which is the (increase)/decrease in working capital of $(1,119) million as determined in accordance with IFRS adjusted for the pre-tax inventory valuation effect of $652 million, was $(467) million compared to $570 million in 2015. Operating cash flow excluding the change in working capital at replacement cost for the full-year 2016 was $16,988 million, a decrease of 12% compared to $19,376 million in 2015. Operating cash flow for the full-year 2016 excluding the change in working capital at replacement cost and without financial charges (DACF) was $17,581 million, a decrease of 11% compared to $19,839 million in 2015. The Group’s net cash flow was $(769) million for the full-year 2016 compared to $(984) million in 2015, an improvement despite a nearly $10/b decrease in the Brent price in 2016 compared to 2015. The decrease in investments was able to offset the decrease in operating cash flow before working capital changes mainly caused by the decrease in hydrocarbon prices and European refining margins.
~~See also “–~~ ~~5.4 Liquidity and Capital Resources”, below.~~
5.3
Business segment reporting
The financial information for each business segment is reported on the same basis as that used internally by the chief operating decision-maker in assessing segment performance and the allocation of segment resources. Due to their particular nature or significance, certain transactions qualifying as ~~“special items”~~"special items" are excluded from the business segment figures. In general, special items relate to transactions that are significant, infrequent or unusual. In certain instances, certain transactions such as restructuring costs or asset disposals, which are not considered to be representative of the normal course of business, may qualify as special items although they may have occurred in prior years or are likely to recur in following years.
In accordance with IAS 2, the Group values inventories of petroleum products in its financial statements according to the First-In, First-Out (FIFO) method and other inventories using the weighted-average cost method. Under the FIFO method, the cost of inventory is based on the historic cost of acquisition or manufacture rather than the current replacement cost. In volatile energy markets, this can have a significant distorting effect on the reported income. Accordingly, the adjusted results of the Refining & Chemicals and Marketing & Services segments are presented according to the replacement cost method in order to facilitate the comparability of the Group’s results with those of its competitors and to help illustrate the operating performance of these segments excluding the impact of oil price changes on the replacement of inventories. In the replacement cost method, which approximates the Last-In, First-Out (LIFO) method, the variation of inventory values in the statement of income is, depending on the nature of the inventory, determined using either the month-end price differential between one period and another or the average prices of the period. The inventory valuation effect is the difference between the results under the FIFO and replacement cost methods.
The effect of changes in fair value presented as an adjustment item reflects, for trading inventories and storage contracts, differences between internal measures of performance used by TOTAL’s management and the accounting for these transactions under IFRS, which requires that trading inventories be recorded at their fair value using period-end spot prices. In order to best reflect the management of economic exposure through derivative transactions, internal indicators used to measure performance include valuations of trading inventories recorded at their fair value based on forward prices. Furthermore, TOTAL, in its trading activities, enters into storage contracts, the future effects of which are recorded at fair value in the Group’s internal economic performance. IFRS, by requiring accounting for storage contracts on an accrual basis, precludes recognition of this fair value effect.
The adjusted business segment results (adjusted operating income and adjusted net operating income) are defined as replacement cost results, adjusted for special items, excluding the effect of changes in fair value. For further information on the adjustments affecting operating income on a segment-by-segment basis, and for a reconciliation of segment figures to figures reported in the Company’s audited Consolidated Financial Statements, see Note 3 to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~247~~265), which is incorporated herein by reference.
The Group measures performance at the segment level on the basis of adjusted net operating income. Net operating income comprises operating income of the relevant segment after deducting the amortization and the depreciation of intangible assets other than leasehold rights, translation adjustments and gains or losses on the sale of assets, as well as all other income and expenses related to capital employed (dividends from non-consolidated companies, income from equity affiliates and capitalized interest expenses) and after income taxes applicable to the above. The income and expenses not included in net operating income that are included in net income are interest expenses related to long-term liabilities net of interest earned on cash and cash equivalents, after applicable income taxes (net cost of net debt and non-controlling interests). Adjusted net operating income excludes the effect of the adjustments (special items and the inventory valuation effect) described above. For further discussion of the calculation of net operating income and the calculation of return on average capital employed (ROACE⁽¹⁾), see Note 3 to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~247~~265), which is incorporated herein by reference.
As of January 1, 2018, the reporting of the cash flow from operations at the segment level changed due to the transfer of financial charges to the Corporate segment. The Corporate segment includes the Group’s holdings operating and financial activities. As a result of this change in reporting, the 2017 and 2016 comparative information is restated at the segment level.

(1)
~~“ROACE”~~ "ROACE" = ratio of adjusted net operating income to average capital employed at replacement cost between the beginning and the end of the period.
~~Total~~ ~~- Form 20-F 2017 - 6~~
Back to Contents
Form 20-F 2018 TOTAL 6
5.3.1

Exploration & Production segment

Environment - liquids and gas price realizations^(a)
2018
2017
2016
Brent ($/b)
71.3
54.2
43.7
Average liquids price ($/b)
64.2
50.2
40.3
Average gas price ($/Mbtu)
4.78
4.08
3.56
Average hydrocarbons price ($/boe)
51.0
38.7
31.9
(a) Consolidated subsidiaries, excluding fixed margins.
Hydrocarbon production
2018
2017
2016
Combined production (kboe/d)
2,775
2,566
2,452
Oil (including bitumen) (kb/d)
1,378
1,167
1,088
Gas (including Condensates and associated LPG) (kboe/d)
1,397
1,399
1,364
Hydrocarbon production
2018
2017
2016
Combined production (kboe/d)
2,775
2,566
2,452
Liquids (kb/d)
1,566
1,346
1,271
Gas (Mcf/d)
6,599
6,662
6,447
Results (M$)
2018
2017
2016
Non-Group sales
10,989
8,477
7,629
Operating income^(a)
12,570
2,792
(431)
Net income (loss) from equity affiliates and other items
2,686
1,546
1,375
Effective tax rate^(b)
46.5%
41.2%
27.7%
Tax on net operating income
(6,068)
(2,233)
401
Net operating income^(a)
9,188
2,105
1,345
Adjustments affecting net operating income
1,022
3,880
1,872
Adjusted net operating income^(c)
10,210
5,985
3,217
- of which income from equity affiliates
2,341
1,542
1,363
Gross investments^(d)
15,282
12,802
16,085
Divestments^(e)
4,952
1,918
2,187
Organic investments^(f)
9,186
11,310
14,464
ROACE
9%
6%
3%
(a) For the definitions of "operating income" and "net operating income", refer to Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
(b) "Effective tax rate" = tax on adjusted net operating income/(adjusted net operating income - income from equity affiliates - dividends received from investments - impairment of goodwill + tax on adjusted net operating income).
(c) Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
(d) Including acquisitions and increases in non-current loans. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(e) Including divestments and reimbursements of non-current loans.
(f) "Organic investments" = net investments, excluding acquisitions, divestments and other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
2018 vs. 2017
In 2018, market conditions were more favorable than in 2017. The average realized price of liquids increased by 28% and the average realized gas price by 17%.
For the full-year 2018, hydrocarbon production was 2,775 kboe/d, an increase of more than 8% compared to 2,566 in 2017, due to:
-+9% for start-ups and ramp-ups on new projects, notably Yamal LNG, Moho Nord, Fort Hills, Kashagan, Kaombo Norte and Ichthys.
-+3% portfolio effect. The addition of Maersk Oil, Al Shaheen in Qatar, Waha in Libya, Lapa and Iara in Brazil as well as the acquisition of an additional 0.5% of Novatek were partially offset by the expiration of the Mahakam permit at the end of 2017 and the sales of Visund in Norway and Rabi in Gabon.
--4% for natural field declines and PSC price effect⁽¹⁾.
(1) The "PSC price effect" refers to the impact of changing hydrocarbon prices on entitlement volumes from production sharing and buyback contracts. For example, as the price of oil or gas increases above certain pre-determined levels, TOTAL’s share of production generally decreases.
Environment – liquids and gas price realizations^(a)
2017
2016
2015
Brent ($/b)
54.2
43.7
52.4
Average liquids price ($/b)
50.2
40.3
47.4
Average gas price ($/Mbtu)
4.08
3.56
4.75
Average hydrocarbons price ($/boe)
38.7
31.9
39.2
(a)
Consolidated subsidiaries, excluding fixed margins.
Back to ContentsForm 20-F 2018 TOTAL 7
Production
2017
2016
2015
Liquids (kb/d)
1,346
1,271
1,237
Gas (Mcf/d)
6,662
6,447
6,054
Combined production (kboe/d)
2,566
2,452
2,347
Results
(M$)
2017
2016
2015
Non-Group sales
8,477
7,629
10,297
Operating income^(a)
2,792
(431)
(2,669)
Equity in income (loss) of affiliates and other items
1,546
1,375
1,944
Effective tax rate^(b)
41.2%
27.7%
48.2%
Tax on net operating income
(2,233)
401
(361)
Net operating income^(a)
2,105
1,345
(1,086)
Adjustments affecting net operating income
3,880
1,872
5,416
Adjusted net operating income^(c)
5,985
3,217
4,330
–
Including income from equity affiliates
1,542
1,363
1,662
Gross investments
12,802
16,085
24,233
Divestments
1,918
2,187
2,880
Organic investments
11,310
14,464
20,536
Cash flow from operating activities
11,459
9,010
11,567
ROACE
6%
3%
4%
(a)
For the definitions of “operating income” and “net operating income”, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
(b)
“Effective tax rate” = tax on adjusted net operating income / (adjusted net operating income – income from equity affiliates – dividends received from investments – impairment of goodwill + tax on adjusted net operating income).
(c)
Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
For a discussion of the Group’s proved reserves, refer to point 2.1.3 ("Reserves") of chapter 2 of the 2018 Registration Document (starting on page 34), which is incorporated herein by reference. See also point 9.1 ("Oil and gas information pursuant to FASBAccounting Standards Codification 932") of chapter 9 of the 2018 Registration Document (starting on page 362), which is incorporated herein by reference, for additional information on proved reserves, including tables showing changes in proved reserves by region.
Non-Group sales for the Exploration & Production segment in 2018 were $10,989 million compared to $8,477 million in 2017, an increase of 30%.
The segment’s adjusted net operating income was $10,210 million in 2018, an increase of 71% compared to $5,985 million in 2017, due to the increase in hydrocarbon prices, despite a tax rate that increased in line with the increase in hydrocarbon prices, and strong production growth.
The effective tax rate increased from 41.2% in 2017 to 46.5% in 2018, in line with the increase in oil prices.
Adjusted net operating income for the Exploration & Production segment excludes special items. In 2018, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of $1,022 million due to the impairment on Ichthys related to the sale of a partial interest by the Group and other assets mainly located in Algeria, Colombia and Congo (for additional information, refer to Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference). In 2017, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of $3,880 million. Special items mainly included impairments of Fort Hills in Canada (following the operator announcement of the increase of the project��s costs), Gladstone LNG in Australia, assets in the Republic of the Congo and gas assets in the United Kingdom, as well as assets in the United States and Norway.
Technical costs⁽¹⁾ for consolidated affiliates, calculated in accordance with ASC 932⁽²⁾, continued decreasing to $18.9/boe in 2018, including $5.7/boe of production costs, compared to $19.5/boe in 2017, including $5.4/boe of production costs.
The segment’s cash flow from operating activities excluding financial charges for the full-year 2018 was $19,803 million, an increase of 54% compared to $12,821 million for the full-year 2017. Operating cash flow excluding the change in working capital at replacement cost and excluding financial charges for the full-year 2018 was $19,374 million, an increase of 31% compared to $14,753 million for the full-year 2017. Operating cash flow before working capital changes less organic investments for the full-year 2018 was $10,210 million compared to $5,985 million in 2017, an increase of 71%.
For information on the segment’s capital expenditures, refer to points 2.1.2 ("Exploration and development") (on page 34) and 2.5 ("Investments") (starting on page 68) of chapter 2 of the 2018 Registration Document, which are incorporated herein by reference. See also "- 5.4 Liquidity and Capital Resources", below.
In this context, the segment’s ROACE for the full-year 2018 was 9% compared to 6% for the full-year 2017.
2017 vs. 2016
In 2017, market conditions were more favorable than in 2016. The average realized price of liquids increased by 25% and the average realized gas price by 15%.
For the full-year 2017, hydrocarbon production was 2,566 thousand barrels of oil equivalent per day (kboe/d), an increase of 5% compared to 2,452 kboe/d in 2016, due to the following:
¬
-+5% due to new start-ups and ramp-ups, notably Moho Nord, Kashagan, Edradour and Glenlivet, and Angola LNG;
¬
-+2% portfolio effect, mainly due to taking over the giant Al Shaheen oil field concession in Qatar and acquiring an additional 75% interest in the Barnett shale in the United States, partially offset by the exit from the southern sector in the Republic of the Congo and asset sales in Norway;
¬
-+1% related to improved security conditions in Libya and Nigeria; and
¬
--3% due to natural field decline, the PSC price effect⁽¹⁾ and OPEC quotas.
~~For a discussion of the Group’s proved reserves, refer to point 2.1.3 (“Reserves”) of chapter 2 of the 2017 Registration Document (starting on~~ ~~page 32~~), which is incorporated herein by reference. See also point 9.1 (“Oil and gas information pursuant to FASB Accounting Standards Codification 932”) of chapter 9 of the 2017 Registration Document (starting on ~~page 344), which is incorporated herein by reference, for additional information on proved reserves, including tables showing changes in proved reserves by region.~~
Non-Group sales for the Exploration & Production segment in 2017 were $8,477 million compared to $7,629 million in 2016, an increase of 11%.
The segment’s adjusted net operating income was $5,985 million in 2017, an increase of 86% compared to $3,217 million in 2016, notably due to production growth, cost reductions and an increase in oil and gas prices.
The effective tax rate increased from 27.7% in 2016 to 41.2% in 2017, in line with the rise in hydrocarbon prices.

~~(1)~~
The “PSC price effect” refers to the impact of changing hydrocarbon prices on entitlement volumes from production sharing and buyback contracts. For example, as the price of oil or gas increases above certain pre-determined levels, TOTAL’s share of production generally decreases.
~~Total~~ ~~- Form 20-F 2017 - 7~~
~~Back to Contents~~
Adjusted net operating income for the Exploration & Production segment excludes special items. The exclusion of special items had a positive impact on the segment’s adjusted net operating income in 2017 of $3,880 million. Special items mainly included impairments of Fort Hills in Canada (following the operator announcement of the increase of the project’s costs), Gladstone LNG in Australia, assets in the Republic of the Congo and gas assets in the United Kingdom, as well as assets in the United States and ~~Norway (for additional information, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on~~ ~~page 247), which is incorporated herein by reference).~~Norway. In 2016, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of $1,872 million. Special items mainly included impairments on Gladstone LNG in Australia, Angola LNG and Laggan-Tormore in the United Kingdom, reflecting the decrease in gas price assumptions for the coming years.
Technical costs⁽¹⁾ for consolidated affiliates, calculated in accordance with ASC 932⁽²⁾~~, continue~~ continued to fall, to $19.5/boe in 2017 compared to $20.4/boe in 2016. This decrease was mainly due to the reduction in production costs from $5.9/boe in 2016 to $5.4/boe in 2017.
The segment’s cash flow from operating activities excluding financial charges for the full-year 2017 was ~~$11,459~~$12,821 million, an increase of ~~27%~~30% compared to ~~$9,010~~$9,866 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost of $(1,932) million ($(726) million in 2016) was $13,391 million compared to $9,736 million in 2016, an increase of 38% whereas oil prices only increased by 24%, notably due to production ramp-ups on major projects started up since 2016, including Kashagan and Moho Nord, the increase in hydrocarbon prices and operating cost reductions. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost and without financial charges was $14,753 million compared to $10,592 million in 2016, an increase of 39%.
~~For information on the segment’s capital expenditures, refer to points 2.1.2 (“Exploration and development”) (on~~ ~~page 32) and 2.5 (“Investments”) (starting on~~ ~~page 68) of chapter 2 of the 2017 Registration Document, which are incorporated herein by reference. See also “–~~  ~~5.4 Liquidity and Capital Resources”, below.~~
In this context, the segment’s ROACE for the full-year 2017 was 6% compared to 3% for the full-year 2016.
(1) "Technical costs" = (Production costs ASC932 + exploration charges + depreciation, depletion and amortization and valuation allowances ASC 932)/ Production ASC932 of the year
(2) Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 932, Extractive industries - Oil and Gas.
~~2016 vs. 2015~~
~~Market conditions were less favorable in 2016 compared~~Back to ~~2015. The average realized price of liquids decreased by 15% and the average realized gas prices by 25%.~~ContentsForm 20-F 2018 TOTAL 8
5.3.2     Gas, Renewables & Power segment
Results (M$)
2018
2017
2016
Non-Group sales
16,136
12,854
10,124
Operating income^(a)
(140)
(276)
(161)
Net income (loss) from equity affiliates and other items
318
31
71
Tax on net operating income
(173)
(140)
(4)
Net operating income^(a)
5
(385)
(94)
Adjustments affecting net operating income
751
870
533
Adjusted net operating income^(b)
756
485
439
Gross investments^(c)
3,539
797
1,221
Divestments^(d)
931
73
166
Organic investments^(e)
511
353
270
ROACE
11%
10%
9%
(a) For the ~~full-year 2016, hydrocarbon production was 2,452 kboe/d, an increase~~definitions of ~~4.5% compared~~"operating income" and "net operating income", refer to ~~2,347 kboe/d in 2015, due~~Note 3 to the ~~following:~~Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
¬
~~+6% due to new start ups and ramp ups, notably Laggan-Tormore, Surmont Phase 2, Termokarstovoye, Gladstone LNG, Moho Phase 1b, and Vega Pleyade, and Incahuasi; and~~
¬
~~-1.5% due~~(b) Adjusted for special items. See Note 3 to the ~~security situation~~Consolidated Financial Statements in ~~Nigeria~~the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
(c) Including acquisitions and ~~Yemen,~~increases in non-current loans. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(d) Including divestments and ~~wild fires in Canada.~~reimbursements of non-current loans.
¬
~~Natural field decline was offset~~(e) "Organic investments" = net investments, excluding acquisitions, divestments and other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by ~~a positive PSC price effect and portfolio effects.~~reference.
2018 vs. 2017
Non-Group sales for the Gas, Renewables & Power segment in ~~2016~~2018 were ~~$7,629~~$16,136 million compared to ~~$10,297~~$12,854 million in ~~2015, a decrease~~2017, an increase of 26%.
The segment’s adjusted net operating income was ~~$3,217~~$756 million in ~~2016, a decrease of 26% compared to $4,330~~2018, 1.6 times higher than $485 million in ~~2015.~~2017, notably due to the good performance of LNG and gas/power trading activities. The acquisitions of Direct Énergie and the LNG business of Engie account for the increase in ~~production combined with~~investments to $3.5 billion in the ~~decrease~~full-year 2018, 4.4 times higher than $797 million in ~~operating costs as well as~~ the ~~lower effective tax rate partially offset the impact of lower hydrocarbon prices.~~full-year 2017.
Adjusted net operating income for the ~~Exploration~~Gas, Renewables & ~~Production~~Power segment excludes special items. The exclusion of special items had a positive impact on the segment’s adjusted net operating income in ~~2016~~2018 of ~~$1,872~~$751 million. Special items ~~mainly~~ included ~~impairments on Gladstone LNG in Australia, Angola LNG, and Laggan-Tormore~~the impairment of production facilities by SunPower (for additional information, refer to Note 3(D) to the Consolidated Financial Statements in the ~~United Kingdom, reflecting the decrease in gas price assumptions for the coming years.~~2018 Registration Document (starting on page 275), which is incorporated herein by reference). In ~~2015,~~2017, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of ~~$5,416~~$870 million. Special items mainly included impairments on Fort Hills in Canada and Gladstone LNG in Australia as well as in Libya, an adjustment to depreciation on Usan in Nigeria following the cancellation of the sale process and the impairment of exploration projects that will not be developed.
Technical costs for consolidated subsidiaries, calculated in accordance with ASC 932, were reduced to $20.4/boe in 2016 compared to $23.0/boe in 2015. This decrease was essentially due to the reduction in production costs from $7.4/boe in 2015 to $5.9/boe in 2016.
The segment’s cash flow from operating activities excluding financial charges for the full-year ~~2016~~2018 was ~~$9,010~~$(670) million ~~a decrease of 22%~~ compared to ~~$11,567~~$1,055 million ~~in 2015. Operating cash flow~~ for the full-year ~~2016 excluding the change~~2017. The increase in working capital ~~at replacement cost of $(726) million ($245 million in 2015) was $9,736 million compared to $11,322 million in 2015, essentially due~~related to the ~~decrease~~consolidation of the acquisitions of Direct Énergie and the LNG business of Engie was mainly responsible for the negative cash flow from operations in ~~hydrocarbon prices, partially offset by~~ the ~~increase in production and decrease in operating costs.~~full-year 2018. Operating cash flow ~~for the full-year 2016~~ excluding the change in working capital at replacement cost and ~~without~~excluding financial charges was ~~$10,592~~$513 million for the full-year 2018, an increase of 74% compared to ~~$11,920~~$294 million ~~in 2015, a decrease~~for the full-year 2017.
For information on the segment’s investments, refer to point 2.5 of ~~11%.~~chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference. See also "- 5.4 Liquidity and Capital Resources", below.
In this context, the segment’s ROACE for the full-year ~~2016~~2018 was 3%11% compared to 4%10% for the ~~full-year 2015.~~full year 2017.

~~(1)~~
~~“Technical costs” = (production costs + exploration expenses + depreciation, depletion and amortization and valuation allowances)/production of the year.~~
~~(2)~~
~~Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 932, Extractive industries – Oil and Gas.~~
~~Total~~ ~~- Form 20-F 2017 - 8~~
~~Back to Contents~~
~~5.3.2~~
~~Gas, Renewables & Power segment~~
Results
(M$, except ERMI)
2017
2016
2015
Non-Group sales
12,854
10,124
9,149
Operating income^(a)
(276)
(161)
(177)
Equity in income (loss) of affiliates and other items
31
71
(75)
Tax on net operating income
(140)
(4)
19
Net operating income^(a)
(385)
(94)
(233)
Adjustments affecting net operating income
870
533
800
Adjusted net operating income^(b)
485
439
567
Gross investments
797
1,221
588
Divestments
73
166
418
Organic investments
353
270
397
Cash flow from operating activities
993
538
(384)
ROACE
10%
9%
13%
(a)
For the definitions of “operating income” and “net operating income”, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
(b)
Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
2017 vs. 2016
Non-Group sales for the Gas, Renewables & Power segment in 2017 were $12,854 million compared to $10,124 million in 2016, an increase of 27%.
The segment’s adjusted net operating income was $485 million in 2017, an increase of 10% compared to $439 million in 2016.
Adjusted net operating income for the Gas, Renewables & Power segment excludes special items. The exclusion of special items had a positive impact on the segment’s adjusted net operating income in 2017 of $870 million. Special items included an impairment concerning SunPower⁽¹⁾ in the United States given the depressed economic environment of the solar ~~activity (for additional information, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on~~ ~~page 247), which is incorporated herein by reference).~~activity. In 2016, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of $533 million.
The segment’s cash flow from operating activities excluding financial charges for the full-year 2017 was ~~$993~~$1,055 million, an increase of ~~85%~~79% compared to $538 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost of $761 million ($413 million in 2016) was $232 million, an increase of 86% compared to $125$589 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost and without financial charges was $294 million compared to $176 million in 2016, an increase of 67%.
~~For information on the segment’s investments, refer to point 2.5 of chapter 2 of the 2017 Registration Document (starting on~~ ~~page 68), which is incorporated herein by reference. See also “–~~ ~~5.4 Liquidity and Capital Resources”, below.~~
In this context, the segment’s ROACE for the full-year 2017 was 10% compared to 9% for the full year 2016.
(1) At December 31, 2017, TOTAL held an interest of 56.26% in SunPower, an American company listed on NASDAQ and based in California.
~~2016~~Back to ContentsForm 20-F 2018 TOTAL 9
5.3.3     Refining & Chemicals segment
Refinery throughput and utilization rates^(a)
2018
2017
2016
Total refinery throughput (kb/d)
1,852
1,827
1,965
- France
610
624
669
- Rest of Europe
755
767
802
- Rest of World
487
436
494
Utilization rates based on crude only^(b)
88%
88%
85%
(a) Includes share of TotalErg, and African refineries reported in the Marketing & Services segment.
(b) Based on distillation capacity at the beginning of the year.
Results (M$, except ERMI)
2018
2017
2016
European refining margin indicator ("ERMI") ($/t)
32.3
40.9
34.1
Non-Group sales
92,025
75,505
65,632
Operating income^(a)
2,513
4,170
4,991
Equity in income (loss) of affiliates and other items
782
2,979
779
Tax on net operating income
(445)
(944)
(1,244)
Net operating income^(a)
2,850
6,205
4,526
Adjustments affecting net operating income
529
(2,415)
(331)
Adjusted net operating income^(b)
3,379
3,790
4,195
Gross investments^(c)
1,781
1,734
1,861
Divestments^(d)
919
2,820
88
Organic investments^(e)
1,604
1,625
1,642
ROACE
31%
33%
38%
(a) For the definitions of "operating income" and "net operating income", refer to Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
(b) Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
(c) Including acquisitions and increases in non-current loans. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(d) Including divestments and reimbursements of non-current loans.
(e) "Organic investments" = net investments, excluding acquisitions, divestments and other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
2018 vs. ~~2015~~2017
Refinery throughput was stable in full-year 2018 compared to full-year 2017. Lower throughput in Europe linked to planned maintenance, notably at Antwerp during the second quarter, was offset by higher throughput outside Europe. The ERMI decreased to $32.3/t on average in 2018 compared to $40.9/t in 2017, a decrease of 21% mainly due to rising crude oil prices.
Non-Group sales for the Refining & Chemicals segment in ~~2016~~2018 were ~~$10,124~~$92,025 million compared to ~~$9,149~~$75,505 million in ~~2015,~~2017, an increase of ~~11%~~22%.
The segment’s adjusted net operating income was ~~$439~~resilient at $3,379 million ~~in 2016,~~for the full-year 2018, a decrease of ~~23%~~11% compared to ~~$567~~$3,790 million ~~2015.~~in 2017.
Adjusted net operating income for the ~~Gas, Renewables~~Refining & ~~Power~~Chemicals segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a positive impact on the segment’s adjusted net operating income in 2018 of $413 million compared to a negative impact of $298 million in 2017. The exclusion of special items had a positive impact on the segment’s adjusted net operating income in ~~2016~~2018 of ~~$533~~$116 million, compared to a ~~positive~~negative impact of ~~$800~~$2,117 million in ~~2015.~~2017.
The segment’s cash flow from operating activities excluding financial charges for the full-year ~~2016~~2018 was ~~$538~~$4,308 million, a decrease of 42% compared to ~~$(384)~~$7,411 million ~~in 2015.~~for the full-year 2017. Operating cash flow for the full-year 2016 excluding the change in working capital at replacement cost of $413 million ($(365) million in 2015) was $125 million, compared to $(19) million in 2015. Operating cash flow for the full-year 20162018 excluding the change in working capital at replacement cost and ~~without~~excluding financial charges was ~~$176~~$4,388 million compared to $5$4,728 million ~~in 2015.~~for the full-year 2017, a decrease of 7%.
For information on the segment’s investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference. See also "- 5.4 Liquidity and Capital Resources", below.
In this context, the segment’s ROACE for the full-year ~~2016~~2018 was 9%31% compared to ~~13%~~33% for the full year ~~2015.~~2017.

~~(1)~~
~~As of December 31, 2017, TOTAL held an interest of 56.26% in SunPower, an American company listed on Nasdaq and based in California.~~
~~Total~~ ~~- Form 20-F 2017 - 9~~
~~Back to Contents~~
~~5.3.3~~
~~Refining & Chemicals segment~~
Refinery throughput and utilization rates^(a)
2017
2016
2015
Total refinery throughput (kb/d)
1,827
1,965
2,023
–
France
624
669
674
–
Rest of Europe
767
802
849
–
Rest of World
436
494
500
Utilization rates based on crude only^(b)
88%
85%
86%
(a)
Includes share of TotalErg, and African refineries reported in the Marketing & Services segment.
(b)
Based on distillation capacity at the beginning of the year.
Results
(M$, except ERMI)
2017
2016
2015
European refining margin indicator (“ERMI”) ($/t)
40.9
34.1
48.5
Non-Group sales
75,505
65,632
70,623
Operating income^(a)
4,170
4,991
4,544
Equity in income (loss) of affiliates and other items
2,979
779
1,724
Tax on net operating income
(944)
(1,244)
(1,106)
Net operating income^(a)
6,205
4,526
5,162
Adjustments affecting net operating income
(2,415)
(331)
(323)
Adjusted net operating income^(b)
3,790
4,195
4,839
Gross investments
1,734
1,861
1,875
Divestments
2,820
88
3,494
Organic investments
1,625
1,642
851
Cash flow from operating activities
7,440
4,585
6,435
ROACE
33%
38%
40%
(a)
For the definitions of “operating income” and “net operating income”, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
(b)
Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
2017 vs. 2016
Refinery throughput decreased by 7% for the full-year 2017 compared to 2016 as a result of the definitive ending of distillation capacity at La Mède (France) and Lindsey (UK) and the temporary shutdown due to Hurricane Harvey in the United States. The ERMI increased to $40.9/t on average in 2017 compared to $34.1/t in 2016, an increase of 20% due to elevated petroleum product demand. In the fourth quarter of 2017, the ERMI was $35.5/t. Petrochemicals continued to benefit from a favorable environment albeit down compared to a year ago.
Non-Group sales for the Refining & Chemicals segment in 2017 were $75,505 million compared to $65,632 million in 2016, an increase of 15%.
Back to ContentsForm 20-F 2018 TOTAL 10
The segment’s adjusted net operating income was $3,790 million for the full-year 2017, a decrease of 10% compared to $4,195 million in 2016, notably due to the impact of Hurricane Harvey, the impact of modernization work on the Antwerp platform and the sale of Atotech in early 2017 as well as lower trading results due to the evolution of the market into backwardation⁽¹⁾.
Adjusted net operating income for the Refining & Chemicals segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a negative impact on the segment’s adjusted net operating income in 2017 of $298 million compared to a negative impact of $500 million in 2016. The exclusion of special items had a negative impact on the segment’s adjusted net operating income in 2017 of $2,117 million, consisting essentially of a gain on the sale of Atotech, compared to a positive impact of $169 million in 2016.
The segment’s cash flow from operating activities excluding financial charges for the full-year 2017 was ~~$7,440~~$7,411 million, an increase of 62% compared to $4,585 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost of $2,683 million ($(289) million in 2016) was $4,757 million, a decrease of 2% compared to $4,874$4,584 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost and without financial charges was $4,728 million compared to $4,873 million in 2016, a decrease of 3%.
~~For information on the segment’s investments, refer to point 2.5 of chapter 2 of the 2017 Registration Document (starting on~~ ~~page 68), which is incorporated herein by reference. See also “–~~ ~~5.4 Liquidity and Capital Resources”, below.~~
In this context, the segment’s ROACE for the full-year 2017 was 33% compared to 38% for the full year 2016.
5.3.4     Marketing & Services segment
Petroleum product sales^(a) (kb/d)
2018
2017
2016
Total Marketing & Services sales
1,801
1,779
1,793
- Europe
1,001
1,049
1,093
- Rest of world
800
730
700
(a) Excludes trading and bulk Refining sales, which are reported under the Refining & Chemicals segment; includes share of TotalErg.
Results (M$)
2018
2017
2016
Non-Group sales
90,206
74,634
66,351
Operating income^(a)
1,841
1,819
1,789
Equity in income (loss) of affiliates and other items
307
497
170
Tax on net operating income
(532)
(561)
(541)
Net operating income^(a)
1,616
1,755
1,418
Adjustments affecting net operating income
36
(79)
141
Adjusted net operating income^(b)
1,652
1,676
1,559
Gross investments^(c)
1,458
1,457
1,245
Divestments^(d)
428
413
424
Organic investments^(e)
1,010
1,019
1,003
ROACE
25%
26%
27%
(a) For the definitions of "operating income" and "net operating income", refer to Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on ~~2016~~page 265), which is incorporated herein by reference.
(b) Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2018 Registration Document (starting on page 265), which is incorporated herein by reference.
(c) Including acquisitions and increases in non-current loans. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
(d) Including divestments and reimbursements of non-current loans.
(e) "Organic investments" = net investments, excluding acquisitions, divestments and other operations with non-controlling interests. For additional information on investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference.
2018 vs. ~~2015~~2017
~~The ERMI averaged $34/t in 2016, a decrease of 30%~~In 2018, petroleum product sales increased by 1% compared to ~~the high level~~2017. The sale of ~~2015,~~TotalErg in Italy was offset by higher sales in the context of high petroleum product stocks. Refinery throughput for the full-year 2016 decreased by 3% compared to 2015, notably due to shutdowns in Europe and the United States in the second quarter and the salerest of the ~~Schwedt refinery in Germany.~~world.
Non-Group sales for the Marketing & Services segment in ~~2016~~2018 were ~~$65,632~~$90,206 million compared to ~~$70,623~~$74,634 million in ~~2015, a decrease~~2017, an increase of 7%21%.

~~(1)~~
~~“Backwardation” is the price structure where the prompt price of an index is higher than the future price.~~
~~Total~~ ~~- Form 20-F 2017 - 10~~
~~Back to Contents~~
The segment’s adjusted net operating income was stable in ~~2016 was $4,195~~2018 at $1,652 million, ~~compared to $4,839 million in 2015,~~ a decrease of ~~13% essentially due~~1% compared to ~~the decrease~~$1,676 million in ~~refining margins. Petrochemicals continued to generate good results, notably due to the strong contribution from the Group’s major integrated platforms in Asia and the Middle East.~~2017.
Adjusted net operating income for the ~~Refining~~Marketing & ~~Chemicals~~Services segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a ~~negative~~positive impact on the segment’s adjusted net operating income in ~~2016~~2018 of ~~$500~~$5 million compared to a positive impact of ~~$590~~$3 million in ~~2015.~~2017. The exclusion of special items had a positive impact on the segment’s adjusted net operating income in ~~2016~~2018 of ~~$169~~$31 million compared to a negative impact of $82 million in ~~2015 of $913 million, consisting essentially of gains on asset sales.~~2017.
The segment’s cash flow from operating activities excluding financial charges for the full-year ~~2016~~2018 was ~~$4,585~~$2,759 million, ~~a decrease~~an increase of ~~29%~~24% compared to ~~$6,435~~$2,221 million in ~~2015.~~2017. Operating cash flow for the full-year 2016 excluding the change in working capital at replacement cost of $(289) million ($647 million in 2015) was $4,874 million, a decrease of 16% compared to $5,788 million in 2015. Operating cash flow for the full-year 20162018 excluding the change in working capital at replacement cost and without financial charges was ~~$4,873~~$2,156 million compared to ~~$5,788~~$2,242 million in ~~2015,~~2017, a decrease of ~~16%~~4%.
For information on the Marketing & Services segment’s investments, refer to point 2.5 of chapter 2 of the 2018 Registration Document (starting on page 68), which is incorporated herein by reference. See also "- 5.4 Liquidity and Capital Resources", below.
In this context, the segment’s ROACE for the full-year ~~2016~~2018 was ~~38%~~25% compared to ~~40%~~26% for the full year ~~2015.~~2017.
(1) "Backwardation" is the price structure where the prompt price of an index is higher than the future price.
~~5.3.4~~Back to ContentsForm 20-F 2018 TOTAL 11
~~Marketing & Services segment~~
Petroleum product sales^(a)(kb/d)
2017
2016
2015
Total Marketing & Services sales
1,779
1,793
1,818
–
Europe
1,049
1,093
1,092
–
Rest of world
730
700
726
(a)
Excludes trading and bulk Refining sales, which are reported under the Refining & Chemicals segment; includes share of TotalErg.
Results
(M$)
2017
2016
2015
Non-Group sales
74,634
66,351
75,282
Operating income^(a)
1,819
1,789
1,665
Equity in income (loss) of affiliates and other items
497
170
467
Tax on net operating income
(561)
(541)
(537)
Net operating income^(a)
1,755
1,418
1,595
Adjustments affecting net operating income
(79)
141
(4)
Adjusted net operating income^(b)
1,676
1,559
1,591
Gross investments
1,457
1,245
1,267
Divestments
413
424
767
Organic investments
1,019
1,003
1,130
Cash flow from operating activities
2,130
1,754
2,323
ROACE
26%
27%
25%
(a)
For the definitions of “operating income” and “net operating income”, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
(b)
Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.
2017 vs. 2016
In 2017, petroleum product sales were generally stable compared to the previous year, with a move toward Africa and Asia where the Group has strong growth. European sales were affected by the divestment of mature LPG distribution activities in Belgium and Germany.
Non-Group sales for the Marketing & Services segment in 2017 were $74,634 million compared to $66,351 million in 2016, an increase of 12%.
The Marketing & Services segment’s results continue to grow in a context of strong retail margins, notably in Africa. The segment’s adjusted net operating income in 2017 was $1,676 million, an increase of 8% compared to $1,559 million in 2016.
Adjusted net operating income for the Marketing & Services segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a positive impact on the segment’s adjusted net operating income in 2017 of $3 million compared to a positive impact of $13 million in 2016. The exclusion of special items had a negative impact on the segment’s adjusted net operating income in 2017 of $82 million compared to a positive impact of $128 million in 2016.
The segment’s cash flow from operating activities excluding financial charges for the full-year 2017 was ~~$2,130~~$2,221 million, an increase of 21% compared to $1,754 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost of $(21) million ($(133) million in 2016) was $2,151 million, an increase of 14% compared to $1,887$1,833 million in 2016. Operating cash flow for the full-year 2017 excluding the change in working capital at replacement cost and without financial charges was $2,242 million compared to $1,966 million in 2016, an increase of 14%.
~~For information on the Marketing & Services segment’s investments, refer to point 2.5 of chapter 2 of the 2017 Registration Document (starting on~~ ~~page 68), which is incorporated herein by reference. See also “–~~ ~~5.4 Liquidity and Capital Resources”, below.~~
In this context, the segment’s ROACE for the full-year 2017 was 26% compared to 27% for the full year 2016.
~~Total~~5.4 ~~- Form 20-F 2017 - 11~~
~~Back to Contents~~
~~2016 vs. 2015~~
~~In 2016, refined product sales decreased slightly compared to 2015, essentially due to the sale of the retail network in Turkey.~~
~~Non-Group sales for the segment in 2016 were $66,351 million compared to $75,282 million in 2015, a decrease of 12%.~~
~~The segment’s adjusted net operating income in 2016 was $1,559 million, a decrease of 2% compared to $1,591 million in 2015.~~
Adjusted net operating income for the Marketing & Services segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a positive impact on the segment’s adjusted net operating income in 2016 of $13 million compared to a positive impact of $169 million in 2015. The exclusion of special items had a positive impact on the segment’s adjusted net operating income in 2016 of $128 million compared to a negative impact of $173 million in 2015.
The segment’s cash flow from operating activities for the full-year 2016 was $1,754 million, a decrease of 24% compared to $2,323 million in 2015. Operating cash flow for the full-year 2016 excluding the change in working capital at replacement cost of $(133) million ($382 million in 2015) was $1,887 million, a decrease of 3% compared to $1,941 million in 2015. Operating cash flow for the full-year 2016 excluding the change in working capital at replacement cost and without financial charges was $1,966 million compared to $2,058 million in 2015, a decrease of 4%.
~~In this context, the segment’s ROACE for the full-year 2016 was 27% compared to 25% for the full year 2015.~~
~~5.4~~
Liquidity and capital resources
(M$)
2017
2016
2015
2018
2017
2016
Cash flow from operating activities
22,319
16,521
19,946
24,703
22,319
16,521
Including (increase) decrease in working capital
827
(1,119)
1,683
769
827
(1,119)
Cash flow used in investing activities
(11,632)
(17,653)
(20,449)
(14,946)
(11,632)
(17,653)
Total expenditures
(16,896)
(20,530)
(28,033)
(22,185)
(16,896)
(20,530)
Total divestments
5,264
2,877
7,584
7,239
5,264
2,877
Cash flow from financing activities
(5,540)
3,532
1,060
(13,925)
(5,540)
3,532
Net increase (decrease) in cash and cash equivalents
5,147
2,400
577
(4,168)
5,147
2,400
Effect of exchange rates
3,441
(1,072)
(2,469)
(1,110)
3,441
(1,072)
Cash and cash equivalents at the beginning of the period
24,597
23,269
25,181
33,185
24,597
23,269
Cash and cash equivalents at the end of the period
33,185
24,597
23,269
27,907
33,185
24,597
TOTAL’s cash requirements for working capital, capital expenditures, acquisitions and dividend payments over the past three years were financed primarily by a combination of funds generated from operations, borrowings and divestments of non-core assets. In the current environment, TOTAL expects its external debt to be principally financed from the international debt capital markets. The Group continually monitors the balance between cash flow from operating activities and net expenditures. In the Company’s opinion, its working capital is sufficient for its present requirements.
5.4.1
Capital expenditures
The largest part of TOTAL’s capital expenditures in ~~2017~~2018 of ~~$16,896~~$22,185 million was made up of additions to intangible assets and property, plant and equipment (approximately ~~84%~~75%), with the remainder attributable to equity-method affiliates and to acquisitions of subsidiaries. In the Exploration & Production segment, as described in more detail under point 9.1.6 (“("Cost ~~incurred”~~incurred") of chapter 9 of the ~~2017~~2018 Registration Document (on page ~~356~~373), which is incorporated herein by reference, capital expenditures in ~~2017~~2018 were principally development costs (approximately ~~87%~~68%, mainly for construction of new production facilities), exploration expenditures (successful or unsuccessful, approximately 5%4%) and acquisitions of proved and unproved properties (approximately 6%28%). In the Gas, Renewables & Power segment, approximately ~~52%~~80% of capital expenditures in ~~2017~~2018 were acquisitions, with the balance being related mainly to facilities investments. In the Refining & Chemicals segment, approximately ~~92%~~83% of capital expenditures in ~~2017~~2018 were related to refining and petrochemical activities (essentially ~~55%~~71% for existing units including maintenance and major turnarounds and ~~45%~~29% for new construction), the balance being related mainly to Hutchinson. In the Marketing & Services segment, approximately ~~24%~~25% of capital expenditures in ~~2017~~2018 were acquisitions, with the balance being related to expenditures mainly in Europe and Africa.
For additional information on capital expenditures, refer to the discussion above in “–"- 5.1 Overview”", “–"- 5.2 Group results ~~2015-2017~~2016-2018”" and “–"- 5.3 Business segment reporting”", above, as well as points 1.5.2 (“("A targeted investment ~~policy”~~policy") of chapter 1 (on page 23) and 2.5 ~~(“Investments”~~("Investments") of chapter 2 (starting on page 68) of the ~~2017~~2018 Registration Document, which are incorporated herein by reference.
5.4.2
Cash flow
Cash flow from operating activities in ~~2017~~2018 was ~~$22,319~~$24,703 million compared to $22,319 million in 2017 and $16,521 million in ~~2016 and $19,946 million in 2015.~~2016. The increase of ~~$5,798~~$2,384 million from ~~2016~~2017 to ~~2017~~2018 was mainly due to an increase of the net result and a decrease in working capital requirements in 2017 of $827 million compared to an increase in 2016 of $1,119 million. The Group’s working capital requirement was affected by the effect of changes in oil and oil product prices. As IFRS rules require TOTAL to account for inventories of petroleum products according to the FIFO method, an increase in oil and oil product prices at the end of the relevant period compared to the beginning of the same period generates, all other factors remaining equal, an increase in inventories and accounts receivable net of an increase in accounts payable, resulting in an increase in working capital requirements. However, despite the increase in oil and oil product prices in 2017, the Group’s working capital requirement decreased by $827 million, due to increases in accounts payable and decreases in other current assets, partially offset by increases in accounts receivable.
~~Total~~ ~~- Form 20-F 2017 - 12~~
~~Back to Contents~~
The Group’s working capital requirement increased by $1,119 million in 2016 mainly due to increases in inventories and receivables partially offset by an increase in payables, and decreased by $1,683 million in 2015 mainly due to reductions in inventory and receivables.result.
Cash flow used in investing activities in ~~2017~~2018 was ~~$11,632~~$14,946 million compared to $11,632 million in 2017 and $17,653 million in ~~2016~~2016. The increase of $3,314 million from 2017 to 2018 was mainly due to higher expenditures on the portfolio of Exploration & Production and ~~$20,449 million in 2015.~~Gas, Renewables & Power segments. The decrease of $6,021 million from 2016 to 2017 was mainly due to lower expenditures on the portfolio of Exploration & Production projects and higher divestments mainly in the Refining & Chemicals segment (principally Atotech). The decrease from 2015 to 2016 was mainly due to lower expenditures on the Group’s portfolio of Upstream projects and lower divestments mainly in the Refining & Chemicals segment, which had a higher level of divestments in 2015 due to the sale of Bostik. Total expenditures in ~~2017~~2018 were ~~$16,896~~$22,185 million compared to $16,896 million in 2017 and $20,530 million in ~~2016 and $28,033 million in 2015.~~2016. During ~~2017, 76%~~2018, 69% of the expenditures were made by the Exploration & Production segment (as compared to 76% in 2017 and 78% in ~~2016 and 86% in 2015)~~2016), 5%16% by the Gas, Power & Renewables segment (as compared to 5% in 2017 and 6% in ~~2016 and 2% in 2015)~~2016), ~~10%~~8% by the Refining & Chemicals segment (compared to 10% in 2017 and 9% in ~~2016~~2016) and 7% ~~in 2015) and 9%~~ by the Marketing & Services segment (compared to 9% in 2017 and 6% in ~~2016 and 5% in 2015)~~2016). The main source of funding for these expenditures was cash from operating activities and issuances of non-current debt. For additional information on expenditures, please refer to
Back to ContentsForm 20-F 2018 TOTAL 12
the discussions in “–"- 5.1 Overview”", “–"- 5.2 Group results ~~2015-2017~~2016-2018”" and “–"- 5.3 Business segment reporting”", above, and point 2.5 ~~(“Investments”~~("Investments") of chapter 2 of the ~~2017~~2018 Registration Document (starting on page 68), which is incorporated herein by reference.
Divestments, based on selling price and net of cash sold, in ~~2017~~2018 were ~~$5,264~~$7,239 million compared to $5,264 million in 2017 and $2,877 million in ~~2016 and $7,584~~2016. In 2018, the Group’s principal divestments were assets sales of $5,172 million, consisting of the reasons set forth in ~~2015.~~"- 5.2 Group results 2016-2018" above. In 2017, the Group’s principal divestments were assets sales of $4,239 million, consisting mainly of sales of Atotech, interests in the Gina Krog field in Norway and in various mature assets in Gabon. In 2016, the Group’s principal divestments were asset sales of $1,864 million, consisting mainly of interests in the FUKA and SIRGE gas pipelines, and the St. Fergus gas terminal in the United Kingdom. In 2015, the Group’s principal divestments were asset sales of $5,968 million, consisting mainly of sales of Bostik, interests in onshore blocks in Nigeria, Totalgaz, the Schwedt refinery, the Géosel oil storage facility, coal mining assets in South Africa, and partial interests in Laggan-Tormore and Fort Hills.
Cash flow from/(used inin) financing activities in ~~2017~~2018 was ~~$(5,540)~~$(13,925) million compared to $(5,540) million in 2017 and $3,532 million in ~~2016 and $1,060 million in 2015.~~2016. The decrease in cash flow from financing activities in ~~2017~~2018 compared to ~~2016~~2017 was primarily due to the ~~non-issuance~~buyback of ~~perpetual subordinated notes~~shares in ~~2017~~2018 ($(4,328) million in 2018 compared to ~~$4,711 million having been issued~~$0 in ~~2016,~~2017), the ~~increase~~decrease in ~~variation~~the net issuance of ~~current borrowings $(7,175)~~non-current debt ($649 million in ~~2017~~2018 compared to ~~$(3,260)~~$2,277 million in ~~2016~~2017) and the decrease in ~~net issuance of non-current borrowings~~current financial assets and liabilities ($~~2,277~~(797) million in ~~2017~~2018 compared to ~~$3,576~~an increase of $1,903 million in ~~2016)~~2017).
5.4.3
Indebtedness
The Company’s non-current financial debt at year-end ~~2017~~2018 was ~~$41,340~~$40,129 million⁽¹⁾ compared to $41,340 million at year-end 2017 and $43,067 million at year-end ~~2016 and $44,464 million at year-end 2015.~~2016. For further information on the Company’s level of borrowing and the type of financial instruments, including maturity profile of debt and currency and interest rate structure, see Note 15 ("Financial structure and financial costs") to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~303~~320), which is incorporated herein by reference. For further information on the Company’s treasury policies, including the use of instruments for hedging purposes and the currencies in which cash and cash equivalents are held, see “"Item 11. Quantitative and Qualitative Disclosures About Market Risk”".
Cash and cash equivalents at year-end ~~2017~~2018 were $27,907 million compared to $33,185 million ~~compared to~~at year-end 2017 and $24,597 million at year-end ~~2016 and $23,269 million at year-end 2015.~~2016.
On ~~November 27, 2017, Standard & Poor’s~~April 25, 2018, Moody’s upgraded TOTAL’s outlook to ~~stable,~~positive, with a long term credit rating remaining ~~at A+.~~Aa3.
5.4.4
Shareholders’ equity
Shareholders’ equity at year-end ~~2017~~2018 was $118,114 million compared to $114,037 million ~~compared to~~at year-end 2017 and $101,574 million at year-end ~~2016~~2016. Changes in shareholders’ equity in 2018 were primarily due to the impacts of comprehensive income, dividend payments, the issuance of common shares and ~~$95,409 million at year-end 2015.~~buy-back shares in the context of the shareholder return policy announced in February 2018. Changes in shareholders’ equity in 2017 were primarily due to the impacts of comprehensive income, dividend payments and the issuance of common shares. Changes in shareholders’ equity in 2016 were primarily due to the impacts of comprehensive income, dividend payments, the issuance of perpetual subordinated notes and the issuance of common shares. ~~Changes~~
In 2018, the Company bought back 72,766,481 TOTAL shares on the market, i.e., 2.76% of the share capital as of December 31, 2018.
71,950,977 TOTAL shares were bought back for cancellation, including:
-47,229,037 shares in ~~shareholders’ equity in 2015 were primarily due~~order to cancel the dilution related to the ~~impacts~~shares issued for payment (i) of ~~dividend payments,~~ the ~~issuance of perpetual subordinated notes~~second and third interim dividends and the ~~issuance~~final dividend for fiscal year 2017, as well as (ii) the first interim dividend for fiscal year 2018; and
-24,721,940 shares for $1.5 billion⁽²⁾, following the Board’s decision to buy back shares of ~~common shares.~~the Company up to an amount of $5 billion over the 2018-2020 period.
815,504 shares were bought back in order to cover the performance share plans approved by the Board of Directors on July 27, 2016, and July 26, 2017.
Finally, the Board of Directors of TOTAL S.A, at a meeting held on December 12, 2018, decided, following the authorization of the Extraordinary Shareholders’ Meeting on May 26, 2017, to cancel 44,590,699 treasury shares, including:
-28,445,840 shares issued, with no discount, in 2018 for payment of the second and third interim dividends, as well as the final dividend, for fiscal year 2017; and
-16,144,859 shares bought back pursuant to the shareholder return policy, up to an amount of $5 billion over the 2018-2020 period.
This transaction had no impact on the consolidated financial statements of TOTAL S.A., the number of fully-diluted weighted-average shares or on the earnings per share.
In 2017, the Company did not buy back any shares. ~~At its meeting held on December 15,~~
As regards fiscal year 2016, ~~and pursuant to~~following the authorization ofgranted by the Extraordinary Shareholders’ Meeting of May 11, 2012, the Company’s Board of Directors decided to cancel 100,331,268 treasury shares (~~i.e.~~~~, 4.13% of the share capital as of December 31, 2016)~~ that the Company had bought back off-market in December 2016, under the share buyback program authorized by the Shareholders’ Meeting on May 24, 2016, from four of its 100% indirectly controlled subsidiaries. Following this transaction, Group affiliates no longer hold any treasury shares. This buyback of shares had no impact on the Company’s Consolidated Financial Statements. In 2015, the Company bought back nearly 4.7 million of its own shares (~~i.e.~~~~, 0.19% of the share capital as of December 31, 2015) under the previous authorization granted by the shareholders at the meeting of May 29, 2015.~~
5.4.5
~~Net-debt-to-equity~~     Net-debt-to-capital
As of December 31, ~~2017,~~2018, TOTAL’s ~~net-debt-to-equity~~net-debt-to-capital ratio^{(2) (3)} was ~~13.8%~~15.5% compared to ~~27.1%~~11.9% and ~~28.3%~~21.1% at year-ends ~~2016~~2017 and ~~2015,~~2016, respectively. The ~~decrease~~increase from ~~2016~~2017 to ~~2017~~2018 was mostly due to the ~~decrease~~increase of the net debt driven by the ~~increase~~decrease in cash and cash equivalents and also by the increase of equity explained above.
As of December 31, ~~2017,~~2018, the Company had ~~$11,478~~$11,515 million of long-term confirmed lines of credit, of which ~~$11,478~~$11,515 million were unused.

(1)
Excludes net current and non-current financial debt of ~~$(140)~~$(15) million as of December 31, ~~2016 and $141 million as of December 31, 2015,~~2018, related to assets classified in accordance with IFRS 5 ~~“non-current~~"non-current assets held for sale and discontinued ~~operations”~~operations". None as of December 31, 2017.
(2)
Or €1.2 billion at the average exchange rate for 2018.
(3) For additional information, refer to Note 15.1(E) to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (on page ~~307~~325), which is incorporated herein by reference.
~~Total~~ ~~- Form 20-F 2017 - 13~~
Back to Contents
Form 20-F 2018 TOTAL 13
5.5
Guarantees and other off-balance sheet arrangements

As of December 31, ~~2017,~~2018, the guarantees provided by the Company in connection with the financing of the Ichthys LNG project amounted to ~~$8,500~~$9,425 million. As of December 31, ~~2016,~~2017, the guarantees amounted to ~~$7,800~~$8,500 million.

Guarantees given against borrowings also include the guarantee given by the Company in connection with the financing of the Yamal LNG project, which amounted to $3,875 million as of December 31, 2018, compared to $4,038 million as of December 31, ~~2017, compared to $3,147 million as~~2017.

~~The Company~~2018, TOTAL S.A. has confirmed ~~and extended~~ guarantees for Total Refining Saudi Arabia ~~S.A.S.~~SAS shareholders’ advances ~~that amounted to~~for an amount of $1,462 million as in 2017.

As of December 31, ~~2017, compared to $1,230 million as of December 31, 2016.~~

~~The~~2018, the guarantee given in 2008 by ~~the Company~~TOTAL S.A. in connection with the financing of the Yemen LNG project ~~amounted~~amounts to $551 million as in 2017.

As of December 31, ~~2017, same as~~2018, guarantees provided by TOTAL S.A. in ~~2016.~~connection with the financing of the Bayport Polymers LLC project, amounted to $1,820 million.

These guarantees and other information on the Company’s commitments and contingencies are presented in Note 13 ("Off balance sheet commitments and lease contracts") to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~296~~312), which is incorporated herein by reference.

The Group does not currently consider that these guarantees, or any other off-balance sheet arrangements of the Company or any other members of the Group, have or are reasonably likely to have, currently or in the future, a material effect on the Group’s financial condition, changes in financial condition, revenues or expenses, results of operation, liquidity, capital expenditures or capital resources.

(b) The current portion of non-current debt is included in the items "Current borrowings", "Current financial assets" and "Other current financial liabilities" of the Consolidated Balance Sheet. The figures in this table are net of the current portion of issue swaps and swaps hedging bonds and exclude the current portion of finance lease obligations of $213 million.

(c) Finance lease obligations and operating lease obligations: the Group leases real estate, retail stations, ships and other equipment through non-cancelable capital and operating leases. These amounts represent the future minimum lease payments on non-cancelable leases to which the Group is committed as of December 31, 2018, less the financial expense due on finance lease obligations for $934 million.

(d) The discounted present value of Exploration & Production asset retirement obligations, primarily asset removal costs at the completion date.

(e) Purchase obligations are obligations under contractual agreements to purchase goods or services, including capital projects. These obligations are enforceable and legally binding on TOTAL and specify all significant terms, including the amount and the timing of the payments. These obligations mainly include: hydrocarbon unconditional purchase contracts (except where an active, highly liquid market exists and when the hydrocarbons are expected to be re-sold shortly after purchase); reservation of transport capacities in pipelines; unconditional exploration works and development works in the Exploration & Production segment; and contracts for capital investment projects in the Refining & Chemicals segment. This disclosure does not include contractual exploration obligations with host states where a monetary value is not attributed and purchases of booking capacities in pipelines where the Group has a participation superior to the capacity used.

For additional information on the Group’s contractual obligations, refer to Note 13 to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~296~~312), which is incorporated herein by reference. The Group has other obligations in connection with pension plans that are described in Note 10 ("Payroll, staff and employee benefits obligations") to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~287~~304), which is incorporated herein by reference. As these obligations are not contractually fixed as to timing and amount, they have not been included in this disclosure. Other non-current liabilities, detailed in Note 12 ("Provisions and other non-current liabilities") to the Consolidated Financial Statements in the ~~2017~~2018 Registration Document (starting on page ~~293~~310), which is incorporated herein by reference, are liabilities related to risks that are probable and amounts that can be reasonably estimated. However, no contractual agreements exist related to the settlement of such liabilities, and the timing of the settlement is not known.

For a discussion of the Group’s R&D policies and activities, refer to points 1.5.1 of chapter 1 (on page 23) and 2.6 of chapter 2 (starting on page 70) of the ~~2017~~2018 Registration Document, which are incorporated herein by reference.

-the Strategy & CSR Committee had ~~five~~six members. With the exception of Mr. Pouyanné, who chairs the committee, all members of this Committee have been deemed independent by the Board of ~~Directors.~~Directors (according to point 14.1 of the AFEP-MEDEF Code, directors representing the employee shareholders and directors representing employees are not taken into account when determining this percentage).

(1) As defined by the AFEP-MEDEF Code, Executive Officers "include the Chairman and Chief Executive Officer, the Deputy chief executive officer(s) of public limited companies with a Board of Directors, the Chairman and members of the Management Board in public limited companies having a Management Board and Supervisory Board and the statutory managers of partnerships limited by shares".

Back to ContentsForm 20-F 2018 TOTAL 24

For a description of the scope of each Committee’s activity and the independence assessment of each member, see point 4.1.2.3 of chapter 4 of the ~~2017~~2018 Registration Document (starting on page ~~127~~132), which is incorporated herein by reference.

The NYSE listing standards also require that the audit, nominating/corporate governance and compensation committees of a U.S.-listed company be vested with decision-making powers on certain matters. Under French law, however, those committees are advisory in nature and have no decision-making authority. Board committees are responsible for examining matters within the scope of their charter and making recommendations thereon to the board of directors. Under French law, the board of directors has the final decision-making authority.

16G.4.2

Audit Committee

The NYSE listing standards contain detailed requirements for the audit committees of U.S.-listed companies. Some, but not all, of these requirements also apply to non-U.S.-listed companies, such as TOTAL. French law and the AFEP-MEDEF Code share the NYSE listing standards’ goal of establishing a system for overseeing the company’s accounting process that is independent from management and that ensures auditor independence. As a result, they address similar topics, with some overlap.

Article L. 823-19 of the French Commercial Code requires the board of directors of companies listed in France to establish an audit committee, at least one member of which must be an independent director and must be competent in finance, accounting or statutory audit procedures. The AFEP-MEDEF Code provides that at least two-thirds of the directors on the audit committee be independent and that the audit committee should not include any Executive Officer. Under NYSE rules, in the absence of an applicable exemption, audit committees are required to satisfy the independence requirements under Rule 10A-3 of the Exchange Act. TOTAL’s Audit Committee consists of ~~three~~four directors, all of whom meet the independence requirements under Rule 10A-3.

The duties of the Company’s Audit Committee, in line with French law and the AFEP-MEDEF Code, are described in point 4.1.2.3 of chapter 4 of the ~~2017~~2018 Registration Document (starting on page ~~127~~132), which is incorporated herein by reference. The Audit Committee regularly reports to the Board of Directors on the fulfillment of its tasks, the results of the financial statements certification process and the contribution of such process to guaranteeing the financial information’s integrity.

One structural difference between the legal status of the audit committee of a U.S.-listed company and that of a French-listed company concerns the degree of the committee’s involvement in managing the relationship between the company and the auditors. French law requires French companies that publish consolidated financial statements, such as TOTAL S.A., to have two co-statutory auditors. While the NYSE listing standards require that the audit committee of a U.S.-listed ~~company~~ have direct ~~responsibility~~responsability for the appointment, compensation, retention and oversight of the work of the ~~auditor,~~auditor. French law provides that the election of the co-statutory auditors is the sole responsibility of the shareholders duly convened at a shareholders’ meeting. In making their decision, the shareholders may rely on proposals submitted to them by the board of directors based on recommendations from the audit committee. The shareholders elect the statutory auditors for an audit period of six financial years. The statutory auditors may only be revoked by a court order and only on grounds of professional negligence or incapacity to perform their mission.

~~(1)~~

As defined by the AFEP-MEDEF Code, Executive Officers “include the Chairman and Chief Executive Officer, the Deputy chief executive officer(s) of public limited companies with a Board of Directors, the Chairman and members of the Management Board in public limited companies having a Management Board and Supervisory Board and the statutory managers of partnerships limited by shares”.

~~Total~~16G.5 ~~- Form 20-F 2017 - 26~~

~~Back to Contents~~

~~16G.5~~

Meetings of non-management directors

The NYSE listing standards require that the non-management directors of a U.S.-listed company meet at regularly scheduled executive sessions without management. French law does not contain such a requirement. The AFEP-MEDEF Code recommends,however, that a meeting not attended by the Executive Officers be organized ~~each~~at least once a year.

Since December 16, 2015, the rules of procedure of the board of directors provide that, with the agreement of the Governance and Ethics Committee, the Lead Independent Director may hold meetings of the directors who do not hold executive or salaried positions on the Board of Directors. He or she reports to the Board of Directors on the conclusions of such meetings.

In December ~~2017,~~2018, the Lead Independent Director held a meeting of the independent directors. She subsequently presented a summary of this meeting to the Board of Directors.

Thus, the Board of Directors’ practice is in line with the recommendation made in the AFEP-MEDEF Code.

16G.6

Shareholder approval of compensation

Pursuant to the provisions of the French Commercial Code, as amended, the compensation of the chairman of the board of directors, the chief executive officer and, as the case may be, the deputy chief executive officer(s) in French listed companies shall each year be submitted to the approval of their shareholders. Articles L. 225-37-2 and L. 225-100 of the French Commercial Code provide respectively for an ex ante ~~ante~~vote and an expost vote:

-exante vote: the shareholders shall each year approve the principles and criteria for determining, allocating and granting the fixed, variable and exceptional components making up the total compensation and the benefits of any kind, attributable to each of the abovementioned officers for the current fiscal year. In the event a resolution is rejected by the shareholders, the preceding already approved compensation policy for the concerned officer will be applicable; and

-expost vote: the shareholders shall each year approve the fixed, variable and exceptional components of the aggregate compensation and benefit of any kinds due or attributable to each of the abovementioned officers for the preceding fiscal year. In the event a resolution is rejected by the shareholders, the variable and exceptional components of the compensation will not be paid to the relevant officer.

16G.7

Disclosure

The NYSE listing standards require U.S.-listed companies to adopt, and post on their websites, a set of corporate governance guidelines. The guidelines must address, among other things: director qualification standards, director responsibilities, director access to management and independent advisers, director compensation, director orientation and continuing education, management succession and an annual performance evaluation of the board. In addition, the chief executive officer of a U.S.-listed company must certify to the NYSE annually that he or she is not aware of any violations by the company of the NYSE’s corporate governance listing standards.

French law requires neither the adoption of such guidelines nor the provision of such certification. The AFEP-MEDEF Code recommends, however, that the board of directors of a French-listed company review its operation annually and perform a formal evaluation at least once every three years, under the leadership of the appointments or nominations committee or an independent director, assisted by an external consultant. TOTAL’s Board of Directors’ most recent formal evaluation took place in early ~~2016.~~2019. The AFEP-MEDEF Code also recommends

Back to ContentsForm 20-F 2018 TOTAL 25

that shareholders be informed of these evaluations each year in the annual report. In addition, Article L. 225-37 of the French Commercial Code requires the board of directors to present to the shareholders a corporate governance report appended to the management report, notably describing the composition of the board and the balanced representation of men and women on the board, the preparation and organization of the Board’s work, as well as the offices and positions of each TOTAL Executive Officer and the compensation received by each such officer. The AFEP-MEDEF Code also includes ethical rules concerning which directors are expected to comply.

16G.8

Code of business conduct and ethics

The NYSE listing standards require each U.S.-listed company to adopt, and post on its website, a code of business conduct and ethics for its directors, officers and employees. ~~There were no similar requirements applicable under French law in 2016.~~Under Article 17 of Law n° 2016/1691 of December 9, 2016, ~~requires the~~ top management (such as the chairman of the board or chief executive officer) of large French companies is required to adopt ~~by June 1, 2017,~~ a code of conduct proscribing the different types of behavior being likely to characterize acts of corruption, bribery or influence ~~peddling, which~~peddling. This code ~~shall~~must be included in the rules of procedure of the company and be submitted to employee representatives. Under the SEC’s rules and regulations, all companies required to submit periodic reports to the SEC, including TOTAL, must disclose in their annual reports whether they have adopted a code of ethics for their principal executive officers and senior financial officers. In addition, they must file a copy of the code with the SEC, post the text of the code on their website or undertake to provide a copy upon request to any person without charge. There is significant, though not complete, overlap between the code of ethics required by the NYSE listing standards and the code of ethics for senior financial officers required by the SEC’s rules. For a description of the code of ethics adopted by TOTAL, refer to point 3.3.2 of chapter 3 of the ~~2017~~2018 Registration Document (starting on page 8887), which is incorporated herein by reference, and “"Item 16B. Code of ethics”".

~~Total~~ ~~- Form 20-F 2017 - 27~~
~~Back to Contents~~
ITEM 16H. ~~MINE SAFETY DISCLOSURE~~Mine safety disclosure
Not applicable.
ITEM 17. ~~FINANCIAL STATEMENTS~~Financial statements
Not applicable.
~~ITEM~~ ~~18.~~ ~~FINANCIAL STATEMENTS~~
~~The Consolidated Financial Statements and Notes thereto included in the 2017 Registration Document (starting on~~ ~~page 233) are incorporated herein by reference.~~
~~The reports of the statutory auditors, ERNST & YOUNG Audit and KPMG Audit, a division of KPMG S.A., are included in the following pages:~~
~~Total~~ ~~- Form 20-F 2017 - 28~~
~~Back to Contents~~
~~KPMG Audit~~
~~Tour EQHO~~
~~2 Avenue Gambetta~~
~~CS 60055~~
~~92066 Paris la Défense Cedex~~
~~France~~
~~ERNST & YOUNG Audit~~
~~1/2, place des Saisons~~
~~92400 Courbevoie – Paris La Défense 1~~
~~France~~
~~TOTAL S.A.~~
~~Registered office: 2, place Jean Millier – La Défense 6 – 92400 Courbevoie – France~~
~~REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS ON THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~To the Shareholders and Board of Directors:~~
~~Opinion~~on~~the~~~~Consolidated~~~~Financial~~~~Statements~~
We have audited the accompanying consolidated balance sheets of TOTAL S.A. and subsidiaries (“the Company”) as of December 31, 2017, 2016 and 2015, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the years in the three year period ended December 31, 2017, and the related notes (collectively, “the consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December  31, 2017, 2016 and 2015, and the results of its operations and its cash flows for each of the years in the three year period ended December 31, 2017, in conformity with International Financial Reporting Standards as adopted by the European Union and in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission”, and our report dated March 14, 2018 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
~~Basis~~~~for~~~~Opinion~~
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are public accounting firms registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
~~Paris La Défense, March 14, 2018~~
~~KPMG Audit,~~
~~a division of KPMG S.A.~~
~~ERNST & YOUNG Audit~~
~~/s/ JACQUES-FRANÇOIS LETHU~~
~~/s/ ERIC JACQUET~~
~~/s/ ERNST & YOUNG AUDIT~~
~~Jacques-François Lethu~~
~~Partner~~
~~Eric Jacquet~~
~~Partner~~
~~ERNST & YOUNG Audit~~
~~We or our predecessor firms have served as the Company's~~
~~auditor since 1996.~~
~~We have served as the Company's auditor since 2004.~~
~~Total~~ ~~- Form 20-F 2017 - 29~~
~~Back to Contents~~
~~KPMG Audit~~
~~Tour EQHO~~
~~2 Avenue Gambetta~~
~~CS 60055~~
~~92066 Paris la Défense Cedex~~
~~France~~
~~ERNST & YOUNG Audit~~
~~1/2, place des Saisons~~
~~92400 Courbevoie – Paris La Défense 1~~
~~France~~
~~TOTAL S.A.~~
~~Registered office: 2, place Jean Millier – La Défense 6 – 92400 Courbevoie – France~~
~~REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS ON THE INTERNAL CONTROL OVER FINANCIAL REPORTING~~
~~Year ended December 31, 2017~~
~~To the Shareholders and Board of Directors,~~
~~Opinion~~on~~Internal~~~~Control~~~~Over~~~~Financial~~~~Reporting~~
We have audited TOTAL S.A. and subsidiaries’ (“the Company”) internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2017, 2016 and 2015, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2017 and the related notes (collectively, “the consolidated financial statements”), and our report dated March 14, 2018 expressed an unqualified opinion on those consolidated financial statements.
~~Basis~~~~for~~~~Opinion~~
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are public accounting firms registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
~~Definition~~~~and~~~~Limitations~~of~~Internal~~~~Control~~~~Over~~~~Financial~~~~Reporting~~
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
~~Paris La Défense, March 14, 2018~~
~~KPMG Audit,~~
~~a division of KPMG S.A.~~
~~ERNST & YOUNG Audit~~
~~/s/ JACQUES-FRANÇOIS LETHU~~
~~/s/ ERIC JACQUET~~
~~/s/ ERNST & YOUNG AUDIT~~
~~Jacques-François Lethu~~
~~Partner~~
~~Eric Jacquet~~
~~Partner~~
~~ERNST & YOUNG Audit~~
~~Total~~ ~~- Form 20-F 2017 - 30~~
~~Back to Contents~~
ITEM 18. Financial statements
The Consolidated Financial Statements and Notes thereto included in the 2018 Registration Document (starting on page 249) are incorporated herein by reference.
The reports of the statutory auditors, ERNST & YOUNG Audit and KPMG Audit, a division of KPMG S.A., are included in the following pages:
Back to ContentsForm 20-F 2018 TOTAL 26
KPMG Audit
Tour EQHO
2 avenue Gambetta
CS 60055
92066 Paris-La Défense Cedex
France
ERNST & YOUNG Audit
1/2, place des Saisons
92400 Courbevoie - Paris-La Défense 1
France
TOTAL S.A.
Registered office: 2, place Jean Millier - La Défense 6 - 92400 Courbevoie - France
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS ON THE CONSOLIDATED FINANCIAL STATEMENTS
To the Board of Directors and Shareholders,
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of TOTAL S.A. and subsidiaries ("the Company") as of December 31, 2018, 2017 and 2016, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2018, and the related notes (collectively, "the consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018, 2017 and 2016, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2018, in conformity with International Financial Reporting Standards as adopted by the European Union and in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 13, 2019 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are public accounting firms registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Paris-La Défense, March 13, 2019
KPMG Audit,
a division of KPMG S.A.
ERNST & YOUNG Audit
/s/ JACQUES-FRANÇOIS LETHU
/s/ ERIC JACQUET
/s/ ERNST & YOUNG Audit
Jacques-François Lethu
Partner
Eric Jacquet
Partner
ERNST & YOUNG Audit
We or our predecessor firms have served as
the Company's auditor since 1996. We have served as the
Company's auditor since 2004.
Back to ContentsForm 20-F 2018 TOTAL 27
KPMG Audit
Tour EQHO
2 avenue Gambetta
CS 60055
92066 Paris-La Défense Cedex
France
ERNST & YOUNG Audit
1/2, place des Saisons
92400 Courbevoie - Paris-La Défense 1
France
TOTAL S.A.
Registered office: 2, place Jean Millier - La Défense 6 - 92400 Courbevoie - France
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS ON THE INTERNAL CONTROL OVER FINANCIAL REPORTING
To the Shareholders and Board of Directors,
Opinion on Internal Control Over Financial Reporting
We have audited TOTAL S.A. and subsidiaries’ ("the Company") internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
As indicated in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include an evaluation of the internal control over financial reporting of the following entities acquired in 2018: Direct Énergie, Quadran and Global LNG. These three entities represented respectively 1.34%, 0.50% and 2.15% of the Group’s total assets as of December 31, 2018 and 0.34%, 0.04% and 0.07% of the Group’s 2018 consolidated sales, which are included in the 2018 consolidated financial statements of the Group.
Our audit of internal control over financial reporting of the Group also did not include an evaluation of the internal control over financial reporting of Direct Énergie, Quadran and Global LNG.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2018, 2017 and 2016, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2018 and the related notes (collectively, "the consolidated financial statements"), and our report dated March 13, 2019 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are public accounting firms registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Paris-La Défense, March 13, 2019
KPMG Audit,
a division of KPMG S.A.
ERNST & YOUNG Audit
/s/ JACQUES-FRANÇOIS LETHU
/s/ ERIC JACQUET
/s/ ERNST & YOUNG Audit
Jacques-François Lethu
Partner
Eric Jacquet
Partner
ERNST & YOUNG Audit
Back to ContentsForm 20-F 2018 TOTAL 28
ITEM 19. ~~EXHIBITS~~Exhibits
The following documents are filed as part of this annual report:
1
Bylaws (Statuts) of TOTAL S.A. (as amended through ~~March 8, 2018)~~January 14, 2019).
2
The total amount of long-term debt securities authorized under any instrument does not exceed 10% of the total assets of the Company and its subsidiaries on a consolidated basis. We hereby agree to furnish to the SEC, upon its request, a copy of any instrument defining the rights of holders of long-term debt of the Company or of its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed.
~~7.1~~
~~Ratio of earnings to fixed charges.~~
~~7.2~~
~~Computation of earnings to fixed charges.~~
8
List of Subsidiaries (see Note 18 to the Consolidated Financial Statements included in the ~~2017~~2018 Registration Document
~~(starting~~ (starting on page ~~324~~340), which is incorporated herein by reference).
11
Code of Ethics (incorporated by reference to the Company’s annual report on Form 20-F for the year ended December 31, 2016, filed on March 17, 2017).
12.1
Certification of Chief Executive Officer.
12.2
Certification of Chief Financial Officer.
13.1
Certification of Chief Executive Officer.
13.2
Certification of Chief Financial Officer.
15.1
Excerpt of the pages and sections of the ~~2017~~2018 Registration Document incorporated herein by reference.
15.2
Consent of ERNST & YOUNG Audit and of KPMG Audit, a division of KPMG S.A.
15.3
Third party report of DeGolyer and MacNaughton.
15.4
Consent of DeGolyer and MacNaughton.
101
XBRL Document.
SIGNATURE
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
TOTAL S.A.
By: /s/ PATRICK POUYANNÉ
~~TOTAL S.A.~~
~~By:~~
~~/s/ PATRICK POUYANNÉ~~
~~Name: Patrick Pouyanné~~
Name: Patrick Pouyanné
Title: Chairman and Chief Executive Officer
Date: March ~~16, 2018~~20, 2019
Back to Contents~~Total~~ - Form 20-F ~~2017 - 31~~
2018 TOTAL 29

(Mark One)
	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2018
OR
	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ________ to ________
OR
	SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	Date of event requiring this shell company report

Title of each class		Name of each exchange on which registered
Shares American Depositary Shares		New York Stock Exchange* New York Stock Exchange

Large accelerated filer	Accelerated filer	Non-accelerated filer
		Emerging growth company

Payment due by period (M$)	Less than 1 year	1-3 years	3-5 years	More than 5 years	Total
Non-current debt obligations^(a)	-	9,156	9,916	18,712	37,784
Current portion of non-current debt obligations^(b)	5,027	-	-	-	5,027
Finance lease obligations^(c)	213	242	226	1,197	1,878
Asset retirement obligations^(d)	844	1,664	1,724	10,054	14,286
Operating lease obligations^(c)	1,644	2,249	1,442	3,795	9,130
- Purchase obligations^(e)	9,708	14,762	15,890	80,759	121,119
TOTAL	17,436	28,073	29,198	114,517	189,224

Payment due by period (M$)	Less than 1 year	1-3 years	3-5 years	More than 5 years	Total
Non-current debt obligations^(a)	-	10,914	8,626	20,004	39,544
Current portion of non-current debt obligations^(b)	4,646	-	-	-	4,646
Finance lease obligations^(c)	39	133	128	856	1,156
Asset retirement obligations^(d)	485	1,093	1,072	9,590	12,240
Operating lease obligations^(c)	1,401	1,801	1,085	2,154	6,441
Purchase obligations^(e)	8,605	12,686	11,231	53,844	86,366
TOTAL	15,176	26,627	22,142	86,448	150,393
(a) Non-current debt obligations are included in the items “Non-current financial debt” and “Hedging instruments of non-current financial debt” of the Consolidated Balance Sheet (refer to point 8.4 of chapter 8 of the 2017 Registration Document (on page 240), which is incorporated herein by reference). The figures in this table are net of the non-current portion of issue swaps and swaps hedging bonds, and exclude non-current finance lease obligations of $1,117 million. (b) The current portion of non-current debt is included in the items “Current borrowings”, “Current financial assets” and “Other current financial liabilities” of the Consolidated Balance Sheet. The figures in this table are net of the current portion of issue swaps and swaps hedging bonds and exclude the current portion of finance lease obligations of $39 million. (c) Finance lease obligations and operating lease obligations: the Group leases real estate, retail stations, ships and other equipment through non-cancelable capital and operating leases. These amounts represent the future minimum lease payments on non-cancelable leases to which the Group is committed as of December 31, 2017, less the financial expense due on finance lease obligations for $48 million. (d) The discounted present value of Exploration & Production asset retirement obligations, primarily asset removal costs at the completion date. (e) Purchase obligations are obligations under contractual agreements to purchase goods or services, including capital projects. These obligations are enforceable and legally binding on TOTAL and specify all significant terms, including the amount and the timing of the payments. These obligations mainly include: hydrocarbon unconditional purchase contracts (except where an active, highly liquid market exists and when the hydrocarbons are expected to be re-sold shortly after purchase); reservation of transport capacities in pipelines; unconditional exploration works and development works in the Exploration & Production segment; and contracts for capital investment projects in the Refining & Chemicals segment. This disclosure does not include contractual exploration obligations with host states where a monetary value is not attributed and purchases of booking capacities in pipelines where the Group has a participation superior to the capacity used.

Hydrocarbon production	2018	2017	2016
Combined production (kboe/d)	2,775	2,566	2,452
Oil (including bitumen) (kb/d)	1,378	1,167	1,088
Gas (including Condensates and associated LPG) (kboe/d)	1,397	1,399	1,364

Results (M$)	2018	2017	2016
Non-Group sales	10,989	8,477	7,629
Operating income^(a)	12,570	2,792	(431)
Net income (loss) from equity affiliates and other items	2,686	1,546	1,375
Effective tax rate^(b)	46.5%	41.2%	27.7%
Tax on net operating income	(6,068)	(2,233)	401
Net operating income^(a)	9,188	2,105	1,345
Adjustments affecting net operating income	1,022	3,880	1,872
Adjusted net operating income^(c)	10,210	5,985	3,217
- of which income from equity affiliates	2,341	1,542	1,363
Gross investments^(d)	15,282	12,802	16,085
Divestments^(e)	4,952	1,918	2,187
Organic investments^(f)	9,186	11,310	14,464
ROACE	9%	6%	3%

Environment – liquids and gas price realizations^(a)	2017	2016	2015
Brent ($/b)	54.2	43.7	52.4
Average liquids price ($/b)	50.2	40.3	47.4
Average gas price ($/Mbtu)	4.08	3.56	4.75
Average hydrocarbons price ($/boe)	38.7	31.9	39.2
(a) Consolidated subsidiaries, excluding fixed margins.

Production	2017	2016	2015
Liquids (kb/d)	1,346	1,271	1,237
Gas (Mcf/d)	6,662	6,447	6,054
Combined production (kboe/d)	2,566	2,452	2,347

Results (M$)	2017	2016	2015
Non-Group sales	8,477	7,629	10,297
Operating income^(a)	2,792	(431)	(2,669)
Equity in income (loss) of affiliates and other items	1,546	1,375	1,944
Effective tax rate^(b)	41.2%	27.7%	48.2%
Tax on net operating income	(2,233)	401	(361)
Net operating income^(a)	2,105	1,345	(1,086)
Adjustments affecting net operating income	3,880	1,872	5,416
Adjusted net operating income^(c)	5,985	3,217	4,330
– Including income from equity affiliates	1,542	1,363	1,662
Gross investments	12,802	16,085	24,233
Divestments	1,918	2,187	2,880
Organic investments	11,310	14,464	20,536
Cash flow from operating activities	11,459	9,010	11,567
ROACE	6%	3%	4%
(a) For the definitions of “operating income” and “net operating income”, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference. (b) “Effective tax rate” = tax on adjusted net operating income / (adjusted net operating income – income from equity affiliates – dividends received from investments – impairment of goodwill + tax on adjusted net operating income). (c) Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.

Results (M$, except ERMI)	2017	2016	2015
Non-Group sales	12,854	10,124	9,149
Operating income^(a)	(276)	(161)	(177)
Equity in income (loss) of affiliates and other items	31	71	(75)
Tax on net operating income	(140)	(4)	19
Net operating income^(a)	(385)	(94)	(233)
Adjustments affecting net operating income	870	533	800
Adjusted net operating income^(b)	485	439	567
Gross investments	797	1,221	588
Divestments	73	166	418
Organic investments	353	270	397
Cash flow from operating activities	993	538	(384)
ROACE	10%	9%	13%
(a) For the definitions of “operating income” and “net operating income”, refer to Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference. (b) Adjusted for special items. See Note 3 to the Consolidated Financial Statements in the 2017 Registration Document (starting on page 247), which is incorporated herein by reference.

Refinery throughput and utilization rates^(a)	2018	2017	2016
Total refinery throughput (kb/d)	1,852	1,827	1,965
- France	610	624	669
- Rest of Europe	755	767	802
- Rest of World	487	436	494
Utilization rates based on crude only^(b)	88%	88%	85%

Results (M$, except ERMI)	2018	2017	2016
European refining margin indicator ("ERMI") ($/t)	32.3	40.9	34.1
Non-Group sales	92,025	75,505	65,632
Operating income^(a)	2,513	4,170	4,991
Equity in income (loss) of affiliates and other items	782	2,979	779
Tax on net operating income	(445)	(944)	(1,244)
Net operating income^(a)	2,850	6,205	4,526
Adjustments affecting net operating income	529	(2,415)	(331)
Adjusted net operating income^(b)	3,379	3,790	4,195
Gross investments^(c)	1,781	1,734	1,861
Divestments^(d)	919	2,820	88
Organic investments^(e)	1,604	1,625	1,642
ROACE	31%	33%	38%

Petroleum product sales^(a) (kb/d)	2018	2017	2016
Total Marketing & Services sales	1,801	1,779	1,793
- Europe	1,001	1,049	1,093
- Rest of world	800	730	700

Petroleum product sales^(a)(kb/d)	2017	2016	2015
Total Marketing & Services sales	1,779	1,793	1,818
– Europe	1,049	1,093	1,092
– Rest of world	730	700	726
(a) Excludes trading and bulk Refining sales, which are reported under the Refining & Chemicals segment; includes share of TotalErg.

(M$)	2017	2016	2015	2018	2017	2016
Cash flow from operating activities	22,319	16,521	19,946	24,703	22,319	16,521
Including (increase) decrease in working capital	827	(1,119)	1,683	769	827	(1,119)
Cash flow used in investing activities	(11,632)	(17,653)	(20,449)	(14,946)	(11,632)	(17,653)
Total expenditures	(16,896)	(20,530)	(28,033)	(22,185)	(16,896)	(20,530)
Total divestments	5,264	2,877	7,584	7,239	5,264	2,877
Cash flow from financing activities	(5,540)	3,532	1,060	(13,925)	(5,540)	3,532
Net increase (decrease) in cash and cash equivalents	5,147	2,400	577	(4,168)	5,147	2,400
Effect of exchange rates	3,441	(1,072)	(2,469)	(1,110)	3,441	(1,072)
Cash and cash equivalents at the beginning of the period	24,597	23,269	25,181	33,185	24,597	23,269
Cash and cash equivalents at the end of the period	33,185	24,597	23,269	27,907	33,185	24,597

Price per share (€)	High	Low
2013	45.670	35.175
2014	54.710	38.250
2015	50.300	36.920
2016	48.885	35.210
First Quarter	43.430	35.210
Second Quarter	45.225	38.065
Third Quarter	44.955	40.530
Fourth Quarter	48.885	41.825
2017	49.500	42.225
First Quarter	49.500	45.825
Second Quarter	49.075	43.145
Third Quarter	46.050	42.225
September	46.050	43.460
Fourth Quarter	49.335	45.070
October	48.165	45.070
November	49.335	45.955
December	48.025	46.025
2018 (through February 28)	48.750	43.090
January	48.750	45.845
February	47.585	43.090

Price per ADR ($)	High	Low
2013	62.45	45.93
2014	74.220	48.433
2015	54.790	40.930
2016	51.360	39.050
First Quarter	48.000	39.050
Second Quarter	51.300	43.550
Third Quarter	50.210	45.355
Fourth Quarter	51.360	45.050
2017	57.070	48.150
First Quarter	52.040	48.840
Second Quarter	54.690	48.920
Third Quarter	55.040	48.150
September	55.040	51.880
Fourth Quarter	57.070	53.010
October	55.940	53.010
November	57.070	54.410
December	56.980	54.140
2018 (through February 28)	59.570	53.370
January	59.570	55.200
February	59.230	53.370

Investors must pay:	For:
$5.00 (or less) per 100 ADSs (or portion of 100 ADSs)	– -Issuance of ADRs, including issuances resulting from a distribution of shares or rights or other property, stocks splits or mergers – -Cancellation of ADRs for the purpose of withdrawal, including if the deposit agreement terminates
A fee equivalent to the fee that would be payable if securities distributed to the investor had been shares and the shares had been deposited for issuance of ADSs	– -Distribution, ~~of securities distributed to holders~~by the depositary, of deposited securities ~~that are distributed by the depositary~~ to ADS registered holders
Registration or transfer fees	– -Transfer and registration of shares on the Company’s share register to or from the name of the depositary or its agent when the investor deposits or withdraws shares
Expenses of the depositary	– -Cable, telex and facsimile transmissions (when expressly provided in the deposit ~~agreement~~ agreement) – -Converting foreign currency to U.S. dollars
Taxes and other governmental charges the depositary or the custodian have to pay on any ADS or share underlying an ADS, for example, stock transfer taxes, stamp duty or withholding taxes	– -As necessary
Any charges incurred by the depositary or its agents for servicing the deposited securities	– -As necessary

~~Period~~	~~Total Number~~ ~~Of Shares~~ ~~(Or Units)~~ ~~Purchased~~	~~Average Price~~ ~~Paid Per~~ ~~Share (Or~~ ~~Units)~~ ~~(€)~~	~~Total Number Of~~ ~~Shares (Or Units)~~ ~~Purchased,~~ ~~As Part Of Publicly~~ ~~Announced Plans Or~~ ~~Programs~~^(a)	~~Maximum Number~~ ~~Of Shares (Or Units)~~ ~~That May Yet Be~~ ~~Purchased~~ ~~Under The Plans Or~~ ~~Programs~~^(b)
~~January 2017~~	-	-	-	~~234,779,415~~
~~February 2017~~	-	-	-	~~234,792,947~~
~~March 2017~~	-	-	-	~~234,805,949~~
~~April 2017~~	-	-	-	~~237,758,364~~
~~May 2017~~	-	-	-	~~237,781,335~~
~~June 2017~~	-	-	-	~~239,569,766~~
~~July 2017~~	-	-	-	~~241,780,495~~
~~August 2017~~	-	-	-	~~241,821,595~~
~~September 2017~~	-	-	-	~~241,897,317~~
~~October 2017~~	-	-	-	~~244,476,614~~
~~November 2017~~	-	-	-	~~244,504,681~~
~~December 2017~~	-	-	-	~~244,522,205~~
~~(a)~~ The Annual Shareholders’ Meeting of May 26, 2017, canceled and replaced the previous resolution from the Annual Shareholders’ Meeting of May 24, 2016, authorizing the Board of Directors to trade in the Company’s own shares on the market for a period of 18 months within the framework of the stock purchase program. The maximum number of shares that may be purchased by virtue of this authorization or under the previous authorization may not exceed 10% of the total number of shares constituting the share capital, this amount being periodically adjusted to take into account operations modifying the share capital after each shareholders’ meeting. Under no circumstances may the total number of shares the Company holds, either directly or indirectly through its subsidiaries, exceed 10% of the share capital. This authorization will be renewed subject to the approval of the Annual Shareholders’ Meeting of June 1, 2018 through the 5^th ~~resolution.~~ ~~(b)~~ Based on 10% of the Company’s share capital, and after deducting the shares held by the Company for cancellation and the shares held by the Company to cover the share purchase option plans for Company employees and restricted share grants for Company employees, as well as after deducting the shares held by the subsidiaries.

Period (in 2018)	Total Number Of Shares (Or Units) Purchased	Average Price Paid Per Share (Or Units) (€)	Total Number Of Shares (Or Units) Purchased, As Part Of Publicly Announced Plans Or Programs^(a)	Maximum Number Of Shares (Or Units) That May Yet Be Purchased Under The Plans Or Programs^(b)
January	-	-	-	245,240,915
February	3,806,704	46.12	3,806,704	242,156,301
March	6,013,784	46.57	6,013,784	245,334,772
April	2,526,827	48.40	2,526,827	244,277,316
May	3,052,902	52.81	3,052,902	242,215,739
June	13,453,104	52.40	13,453,104	229,361,106
July	4,203,193	53.32	4,203,193	229,245,637
August	5,346,739	54.54	5,346,739	223,915,417
September	3,825,608	54.31	3,825,608	220,111,990
October	3,072,673	55.34	3,072,673	218,918,027
November	17,575,126	50.16	17,575,126	201,344,111
December	9,889,821	48.60	9,889,821	231,586,919

~~KPMG Audit,~~ ~~a division of KPMG S.A.~~		~~ERNST & YOUNG Audit~~
~~/s/ JACQUES-FRANÇOIS LETHU~~	~~/s/ ERIC JACQUET~~	~~/s/ ERNST & YOUNG AUDIT~~
~~Jacques-François Lethu~~ ~~Partner~~	~~Eric Jacquet~~ ~~Partner~~	~~ERNST & YOUNG Audit~~
~~We or our predecessor firms have served as the Company's~~ ~~auditor since 1996.~~		~~We have served as the Company's auditor since 2004.~~

KPMG Audit, a division of KPMG S.A.		ERNST & YOUNG Audit

/s/ JACQUES-FRANÇOIS LETHU	/s/ ERIC JACQUET	/s/ ERNST & YOUNG Audit
Jacques-François Lethu Partner	Eric Jacquet Partner	ERNST & YOUNG Audit
We or our predecessor firms have served as the Company's auditor since 1996.		We have served as the Company's auditor since 2004.

1	Bylaws (Statuts) of TOTAL S.A. (as amended through ~~March 8, 2018)~~January 14, 2019).
2	The total amount of long-term debt securities authorized under any instrument does not exceed 10% of the total assets of the Company and its subsidiaries on a consolidated basis. We hereby agree to furnish to the SEC, upon its request, a copy of any instrument defining the rights of holders of long-term debt of the Company or of its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed.
~~7.1~~	~~Ratio of earnings to fixed charges.~~
~~7.2~~	~~Computation of earnings to fixed charges.~~
8	List of Subsidiaries (see Note 18 to the Consolidated Financial Statements included in the ~~2017~~2018 Registration Document ~~(starting~~ (starting on page ~~324~~340), which is incorporated herein by reference).
11	Code of Ethics (incorporated by reference to the Company’s annual report on Form 20-F for the year ended December 31, 2016, filed on March 17, 2017).
12.1	Certification of Chief Executive Officer.
12.2	Certification of Chief Financial Officer.
13.1	Certification of Chief Executive Officer.
13.2	Certification of Chief Financial Officer.
15.1	Excerpt of the pages and sections of the ~~2017~~2018 Registration Document incorporated herein by reference.
15.2	Consent of ERNST & YOUNG Audit and of KPMG Audit, a division of KPMG S.A.
15.3	Third party report of DeGolyer and MacNaughton.
15.4	Consent of DeGolyer and MacNaughton.
101	XBRL Document.

~~TOTAL S.A.~~
~~By:~~	~~/s/ PATRICK POUYANNÉ~~
	~~Name: Patrick Pouyanné~~ Name: Patrick Pouyanné Title: Chairman and Chief Executive Officer