TotalEnergies SE (TTE) 6-K 2018 H1 Current report (foreign)

Exhibit 99.1

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The financial information on pages 1-14 of this exhibit concerning TOTAL S.A. and its subsidiaries and affiliates (collectively, “TOTAL” or the “Group”) with respect to the second quarter of 2018 and six months ended June 30, 2018, has been derived from TOTAL’s unaudited consolidated balance sheets as of June 30, 2018 and unaudited statements of income, comprehensive income, cash flow and changes in shareholders’ equity and business segment information for the second quarter of 2018 and six months ended June 30, 2018 presented on pages 15-22 and 35-46 of this exhibit. The following discussion should be read in conjunction with the aforementioned financial statements and with the information, including TOTAL’s audited consolidated financial statements and related notes, provided in TOTAL’s Annual Report on Form 20-F for the year ended December 31, 2017, filed with the Securities and Exchange Commission (“SEC”) on March 16, 2018.

A. KEY FIGURES

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars except earnings per share and number of shares	1H18			1H17			1H18 vs 1H17
	52,540			49,611			39,915			+32	%	Non-Group sales		102,151			81,098			+26	%
												Adjusted net operating income from business segments(a)
	2,687			2,183			1,359			+98	%	• Exploration & Production		4,870			2,741			+78	%
	193			115			95			+103	%	• Gas, Renewables & Power		308			156			+97	%
	821			720			861			-5	%	• Refining & Chemicals		1,541			1,884			-18	%
	478			367			433			+10	%	• Marketing & Services		845			734			+15	%
	1,103			484			310			x3.6		Net income (loss) from equity affiliates		1,587			858			+85	%
	1.38			0.99			0.79			+75	%	Fully-diluted earnings per share ($)		2.38			1.92			+24	%
	2,646			2,568			2,485			+7	%	Fully-diluted weighted-average shares (millions)		2,608			2,471			+6	%
	3,721			2,636			2,037			+83	%	Net income (Group share)		6,357			4,886			+30	%
	3,787			6,724			4,205			-10	%	Investments(b)		10,511			7,883			+33	%
	1,274			2,585			360			x3.5		Divestments(c)		3,859			3,258			+18	%
	2,513			4,139			3,845			-35	%	Net investments(d)		6,652			4,625			+44	%
	2,780			2,620			3,949			-30	%	Organic investments(e)		5,400			6,893			-22	%
	333			3,474			52			x6.4		Resource acquisitions(f)		3,807			64			n/a
	6,246			2,081			4,640			+35	%	Cash flow from operations		8,327			9,341			-11	%
												Of which:
	(856	)		(3,222	)		(268	)		n/a		• (increase)/decrease in working capital(g)		(4,078	)		(322	)		n/a
	(398	)		(298	)		(247	)		+61	%	• financial charges		(696	)		(462	)		+51	%

(a)	Adjusted results are defined as income using replacement cost, adjusted for special items, excluding the impact of changes for fair value. See “Analysis of business segment results” below and page 12 for further details.
(b)	Including acquisitions and increases in non-current loans.
(c)	Including divestments and reimbursements of non-current loans.
(d)	“Net investments” = investments - divestments - repayment of non-current loans - other operations with non-controlling interests.
(e)	“Organic investments” = net investments excluding acquisitions, asset sales and other operations with non-controlling interests. See page 12 of this exhibit.
(f)	“Resource acquisitions” = acquisition of a participating interest in an oil and gas mining property by way of 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 $(153) million in 2Q18, $(3,289) million in 1Q18, $(694) million in 2Q17, $(3,442) million in 1H18 and $(680) million in 1H17. For information on the replacement cost method, refer to the second paragraph of “B. Analysis of business segment results”. See also “C. Group results — Cash flow”.

B. ANALYSIS OF BUSINESS SEGMENT RESULTS

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” 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.

1

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 TOTAL’s interim consolidated financial statements, see pages 35-43 of this exhibit.

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.

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 comparative information has been restated at the segment level.

B.1. Exploration & Production segment

• Environment — liquids and gas price realizations*

2Q18		1Q18		2Q17		2Q18 vs 2Q17				1H18		1H17		1H18 vs 1H17
	74.4		66.8		49.6		+50	%	Brent ($/b)		70.6		51.7		+37	%
	69.5		60.4		45.1		+54	%	Average liquids price ($/b)		65.3		47.1		+39	%
	4.49		4.73		3.93		+14	%	Average gas price ($/Mbtu)		4.61		4.01		+15	%
	54.3		47.3		35.5		+53	%	Average hydrocarbons price ($/boe)		50.9		36.7		+39	%

* Consolidated subsidiaries, excluding fixed margins.

• Production

2Q18		1Q18		2Q17		2Q18 vs 2Q17			Hydrocarbon production	1H18		1H17		1H18 vs 1H17
	2,717		2,703		2,500		+9	%	Combined production (kboe/d)		2,710		2,534		+7	%
	1,582		1,481		1,298		+22	%	• Liquids (kb/d)		1,532		1,300		+18	%
	6,176		6,664		6,500		-5	%	• Gas (Mcf/d)		6,419		6,696		-4	%

2

Hydrocarbon production was 2,717 thousand barrels of oil equivalent per day (kboe/d) in the second quarter 2018, an increase of close to 9% compared to the second quarter 2017, due to:

• +7% due to new project start-ups and ramp-ups, notably Moho Nord, Yamal LNG, Edradour-Glenlivet, Kashagan, Fort Hills, Timimoun and Libra;

• +6% portfolio effect, mainly due to the integration of Al-Shaheen in Qatar, the Maersk Oil assets, Waha in Libya, and Lapa and Iara in Brazil, which were partially offset by the expiration of the Mahakam permit in Indonesia at the end of 2017;

• -4% due to heavier seasonal maintenance activity, the PSC price effect¹ and natural field decline.

In the first half 2018, hydrocarbon production was 2,710 kboe/d, an increase of 7% compared to the first half 2017, due to:

• +7% due to new project start-ups and ramp-ups, notably Moho Nord, Yamal LNG, Edradour-Glenlivet, Kashagan, Fort Hills and Libra;

• +3% portfolio effect, mainly due to the integration of Al-Shaheen in Qatar, the Maersk Oil assets, Waha in Libya, and Lapa and Iara in Brazil, which were partially offset by the expiration of the Mahakam permit in Indonesia at the end of 2017;

• -3% due to heavier seasonal maintenance activity, the PSC price effect and natural field decline.

• Results

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars	1H18			1H17			1H18 vs 1H17
	3,398			2,467			2,068			+64	%	Non-Group sales		5,865			4,171			+41	%
	3,773			2,996			1,295			x3		Operating income		6,769			1,191			x5.7
	569			641			487			+17	%	Net income (loss) from equity affiliates and other items		1,210			677			+79	%
	46.3	%		48.1	%		36.2	%				Effective tax rate*		47.1	%		39.3	%
	(1,772	)		(1,550	)		(512	)		x3.5		Tax on net operating income		(3,322	)		(951	)		x3.5
	2,570			2,087			1,270			x2		Net operating income		4,657			917			x5.1
	117			96			89			+31	%	Adjustments affecting net operating income		213			1,824			-88	%
	2,687			2,183			1,359			+98	%	Adjusted net operating income**		4,870			2,741			+78	%
	575			446			373			+54	%	• Including income from equity affiliates		1,021			688			+48	%
	2,980			5,871			3,448			-14	%	Investments		8,851			6,084			+45	%
	500			2,251			132			x3.8		Divestments		2,751			245			x11.2
	2,114			2,057			3,296			-36	%	Organic investments		4,171			5,802			-28	%

* “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).

**Detail of adjustment items shown in the business segment information starting on page 35 of this exhibit.

The Exploration & Production segment’s adjusted net operating income was:

• $2,687 million in the second quarter 2018, or practically double the second quarter 2017. The Group benefited fully from the increase in hydrocarbon prices, thanks to higher production and lower costs, despite an increase in tax rates over the year to 46.3% in line with increasing hydrocarbon prices.

• $4,870 million in the first half 2018, an increase of 78% compared to the first half 2017, for the same reasons.

Adjusted net operating income for the Exploration & Production segment excludes special items. In the second quarter of 2018, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of $117 million compared to a positive impact of $89 million in the second quarter of 2017.

The segment’s cash flow from operating activities excluding financial charges was $4,628 million in the second quarter of 2018, an increase of 63% compared to $2,836 million in the second quarter of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the second quarter of 2018 was $5,115 million, an increase of 43% compared to $3,580 million in the second quarter of 2017², as a result of the increase in hydrocarbon prices, thanks to higher production and lower costs. The Exploration & Production segment generated $5,209 million of cash flow after organic investments in the first half 2018.

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 normally decreases.

² 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 “B. Analysis of business segment results”, above. The reconciliation table for different cash flow figures is set forth under “Cash Flow” on page 12 of this exhibit.

3

In the first half of 2018, the segment’s cash flow from operating activities excluding financial charges was $8,197 million, an increase of 45% compared to $5,637 million in the first half of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the first half of 2018 was $9,380 million, an increase of 36% compared to $6,916 million in the first half of 2017, thanks to the same reasons mentioned in the paragraph above.

B.2. Gas, Renewables & Power segment

• Results

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars	1H18			1H17			1H18 vs 1H17
	3,268			4,091			2,671			+22	%	Non-Group sales		7,359			5,868			+25	%
	(336	)		(37	)		48			n/a		Operating income		(373	)		13			n/a
	128			34			13			x9.8		Net income (loss) from equity affiliates and other items		162			(32	)		n/a
	(19	)		(15	)		(24	)		-21	%	Tax on net operating income		(34	)		(61	)		-44	%
	(227	)		(18	)		37			n/a		Net operating income		(245	)		(80	)		x3.1
	420			133			58			x7.2		Adjustments affecting net operating income		553			236			x2.3
	193			115			95			+103	%	Adjusted net operating income*		308			156			+97	%
	79			249			77			+3	%	Investments		328			392			-16	%
	405			78			23			x17.6		Divestments		483			27			x17.9
	60			77			68			-12	%	Organic investments		136			170			-20	%

*Detail of adjustment items shown in the business segment information starting on page 35 of this exhibit.

Adjusted net operating income for the Gas, Renewables & Power segment was $193 million in the second quarter 2018 and $308 million in the first half 2018, thanks to an increased contribution from the gas business and better performance from new energies, compared to $95 million in the second quarter 2017 and $156 million in the first half 2017.

Adjusted net operating income for the Gas, Renewables & Power segment excludes special items. In the second quarter of 2018, the exclusion of special items had a positive impact on the segment’s adjusted net operating income of $420 million compared to a positive impact of $58 million in the second quarter of 2017.

The segment’s cash flow from operating activities excluding financial charges was $104 million in the second quarter of 2018, compared to $(100) million in the second quarter of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the second quarter of 2018 was $177 million, an increase of 43% compared to 124 million in the second quarter of 2017.

In the first half of 2018, the segment’s cash flow from operating activities excluding financial charges was $(75) million compared to $40 million in the first half of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the first half of 2018 was $226 million, an increase of 42% compared to 159 million in the first half of 2017.

4

B.3. Refining & Chemicals segment

• Refinery throughput and utilization rates*

2Q18			1Q18			2Q17			2Q18 vs 2Q17				1H18			1H17			1H18 vs 1H17
	1,734			1,832			1,672			+4	%	Total refinery throughput (kb/d)		1,784			1,796			-1	%
	569			624			574			-1	%	• France		597			600			-1	%
	670			746			684			-2	%	• Rest of Europe		708			742			-5	%
	495			462			414			+20	%	• Rest of world		479			454			+6	%
	83	%		87	%		81	%				Utilization rates based on crude only**		85	%		86	%

* Includes share of TotalErg, as well as refineries in Africa that are reported in the Marketing & Services segment.

** Based on distillation capacity at the beginning of the year.

Refinery throughput:

• increased by 4% in the second quarter 2018 compared to the second quarter 2017, notably as a result of higher throughput at SATORP after debottlenecking increased its capacity by more than 10%.

• wasstable in the first half 2018 compared to the first half 2017. Lower throughput in Europe linked to planned maintenance, notably at Antwerp, was offset by higher throughput in the rest of the world.

• Results

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars, except the ERMI	1H18			1H17			1H18 vs 1H17
	34.7			25.6			41.0			-15	%	European refining margin indicator - ERMI ($/t)		30.1			40.0			-25	%
	23,349			21,739			17,347			+35	%	Non-Group sales		45,088			35,921			+26	%
	1,249			656			520			x2.4		Operating income		1,905			1,574			+21	%
	289			128			148			+95	%	Net income (loss) from equity affiliates and other items		417			2,601			-84	%
	(279	)		(104	)		(142	)		+96	%	Tax on net operating income		(383	)		(498	)		-23	%
	1,259			680			526			x2.4		Net operating income		1,939			3,677			-47	%
	(438	)		40			335			n/a		Adjustments affecting net operating income		(398	)		(1,793	)		-78	%
	821			720			861			-5	%	Adjusted net operating income*		1,541			1,884			-18	%
	404			332			401			+1	%	Investments		736			667			+10	%
	324			25			20			x16.2		Divestments		349			2,760			-87	%
	386			308			381			+1	%	Organic investments		694			603			+15	%

*Detail of adjustment items shown in the business segment information starting on page 35 of this exhibit.

The Group’s European refining margin indicator (ERMI) decreased by 15% from a year ago to $34.7/t in the second quarter 2018, and it decreased by 25% from a year ago to $30.1/t for the first half 2018. Petrochemical margins continue to benefit from a favorable environment, notably in the United States and Asia-Middle East, but margins in Europe were lower compared to a year ago mainly due to an increase in feedstock prices.

In this context, adjusted net operating income for the Refining & Chemicals segment was:

• $821 million in the second quarter 2018, a decrease of 5% compared to the second quarter 2017.

• $1,541 million in the first half 2018, a decrease of 18% compared to the first half 2017.

Adjusted net operating income for the Refining & Chemicals segment excludes any after-tax inventory valuation effect and special items. In the second quarter of 2018, the exclusion of the inventory valuation effect had a negative impact on the segment’s adjusted net operating income of $438 million compared to a positive impact of $270 million in the second quarter of 2017. The exclusion of special items in the second quarter of 2018 had a neutral impact on the segment’s adjusted net operating income compared to a positive impact of $65 million in the second quarter of 2017.

5

The segment’s cash flow from operating activities excluding financial charges was $999 million in the second quarter of 2018, a decrease of 49% compared to $1,967 million in the second quarter of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the second quarter of 2018 was $1,018 million, a decrease of 24% compared to 1,347 million in the second quarter of 2017.

In the first half of 2018, the segment’s cash flow from operating activities excluding financial charges was $(110) million compared to $3,729 million in the first half of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the first half of 2018 was $1,938 million, a decrease of 19% compared to 2,378 million in the first half of 2017.

B.4. Marketing & Services segment

• Petroleum product sales

2Q18		1Q18		2Q17		2Q18 vs 2Q17			sales in kb/d*	1H18		1H17		1H18 vs 1H17
	1,799		1,801		1,760		+2	%	Total Marketing & Services sales		1,800		1,744		+3	%
	1,001		993		1,039		-4	%	• Europe		997		1,039		-4	%
	798		808		721		+11	%	• Rest of world		803		705		+14	%

*Excludes trading and bulk refining sales, which are reported under the Refining & Chemicals segment (see page 11 of this exhibit); includes share of TotalErg.

Petroleum product sales:

• increased by 2% in the second quarter 2018 compared to the second quarter 2017, despite the sale of TotalErg in Italy, due to growth in the business, notably in Asia and Africa.

• increased by 3% in the first half 2018 compared to the first half 2017 for the same reasons.

• Results

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars	1H18			1H17			1H18 vs 1H17
	22,528			21,308			17,831			+26	%	Non-Group sales		43,836			35,129			+25	%
	662			357			360			+84	%	Operating income		1,019			734			+39	%
	107			86			258			-59	%	Net income (loss) from equity affiliates and other items		193			288			-33	%
	(194	)		(103	)		(123	)		+58	%	Tax on net operating income		(297	)		(231	)		+29	%
	575			340			495			+16	%	Net operating income		915			791			+16	%
	(97	)		27			(62	)		-56	%	Adjustments affecting net operating income		(70	)		(57	)		+23	%
	478			367			433			+10	%	Adjusted net operating income*		845			734			+15	%
	310			228			258			+20	%	Investments		538			697			-23	%
	45			228			182			-75	%	Divestments		273			218			+25	%
	205			136			185			+11	%	Organic investments		342			280			+22	%

*Detail of adjustment items shown in the business segment information starting on page 35 of this exhibit.

Adjusted net operating income for the Marketing & Services segment was:

• $478 million in the second quarter 2018, an increase of 10% compared to the second quarter 2017, due to volume growth in a context of favorable margins, notably in Africa.

• $845 million in the first half 2018, a 15% increase compared to the first half 2017, for the same reasons.

Adjusted net operating income for the Marketing & Services segment excludes any after-tax inventory valuation effect and special items. In the second quarter of 2018, the exclusion of the inventory valuation effect had a negative impact on the segment’s adjusted net operating income of $97 million compared to a positive impact of $45 million in the second quarter of 2017. The exclusion of special items in the second quarter of 2018 had a neutral impact on the segment’s adjusted net operating income compared to a negative impact of $107 million in the second quarter of 2017.

The segment’s cash flow from operating activities excluding financial charges was $841 million in the second quarter of 2018, 3.4 times more compared to $251 million in the second quarter of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the second quarter of 2018 was $646 million, an increase of 4% compared to $624 million in the second quarter of 2017.

6

In the first half of 2018, the segment’s cash flow from operating activities excluding financial charges was $781 million, an increase of 34% compared to $582 million in the first half of 2017. Operating cash flow in the first half of 2018 excluding the change in working capital at replacement cost and without financial charges was $1,076 million, an increase of 2% compared to $1,053 million in the first half of 2017.

C. GROUP RESULTS

• Net income (Group share)

Net income (Group share) was $3,721 million in the second quarter of 2018, an increase of 83% compared to $2,037 million in the second quarter of 2017, and $6,357 million in the first half of 2018, an increase of 30% compared to $4,886 million in the first half of 2017.

Adjusted net income (Group share) was:

• $3,553 million in the second quarter 2018, an increase of 44% compared to the second quarter 2017, essentially due to 52% increase in the contribution of the segments, partially offset by higher net cost of net debt, mainly due to an increase in U.S. dollar interest rates.

• $6,437 million in the first half 2018, a 28% increase compared to the first half 2017 for the same reasons.

Adjusted net income excludes the after-tax inventory effect, special items and the impact of changes in fair value³.

Total adjustments affecting net income (Group share)⁴were:

• $168 million in the second quarter 2018.

• -$80 million in the first half 2018.

• Fully-diluted shares and share buyback

On June 30, 2018, the number of fully-diluted shares was 2,644 million, compared to 2,503 million on June 30, 2017.

Within the framework of the shareholder return policy announced in February 2018, the Group bought back shares in the first half 2018 for cancellation. The buyback is comprised of repurchasing shares issued as scrip dividend to eliminate dilution and additional shares to share with shareholders the benefit resulting from higher oil prices.

• 18.6 million shares repurchased in the second quarter 2018, including additional shares for $299 million.

• 28.4 million shares repurchased in the first half 2018, including additional shares for $589 million.

• Divestments — acquisitions

Asset sales were:

• $693 million completed in the second quarter 2018, comprised mainly of SunPower’s sale of its interest in 8point3, and the sale of the Bayport (US) polyethylene plant to the joint venture formed with Borealis and Nova in which Total holds 50%, compared to $207 million in the second quarter of 2017.

• $2,862 million completed in the first half 2018, comprised mainly of the items above plus the high-cost Martin Linge field in Norway, an interest in Fort Hills in Canada and the marketing activities of TotalErg in Italy, compared to 2,918 million in the first half of 2017.

Acquisitions were:

• $426 million completed in the second quarter 2018, comprised mainly of offshore assets from Cobalt in the Gulf of Mexico, notably including 20% interest in the North Platte and Anchor discoveries, and an interest in Clean Energy in the United States to expand into marketing natural gas for vehicles.

• $4,114 million completed in the first half 2018, comprised mainly of the items above plus interests in the Iara and Lapa fields in Brazil, two new 40-year concessions in offshore Abu Dhabi, and the Waha field in Libya.

³ Details shown on page 12 of this exhibit.

⁴ Details shown on pages 12 of this exhibit.

7

• Cash flow

The Group’s cash flow from operating activities was $6,246 million in the second quarter of 2018, an increase of 35% compared to $4,640 million in the second quarter of 2017. The change in working capital at replacement cost in the second quarter of 2018, which is the (increase)/decrease in working capital of $(856) million as determined in accordance with IFRS adjusted for the pre-tax inventory valuation effect of $703 million, was $(153) million compared to $(694) million in the second quarter of 2017. Operating cash flow excluding the change in working capital at replacement cost in the second quarter of 2018 was $6,399 million, an increase of 20% compared to $5,334 million in the second quarter of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the second quarter of 2018 was $6,797 million, an increase of 22% compared to $5,581 million in the second quarter of 2017.

The Group’s net cash flow⁵ was $3,886 million in the second quarter 2018 compared to $1,489 million in the second quarter 2017, thanks mainly to a 20% increase in operating cash flow before working capital changes.

In the first half of 2018, the Group’s cash flow from operating activities was $8,327 million, a decrease of 11% compared to $9,341 million in the first half of 2017. The change in working capital at replacement cost in the first half of 2018, which is the (increase)/decrease in working capital of $(4,078) million as determined in accordance with IFRS adjusted for the pre-tax inventory valuation effect of $636 million, was $(3,442) million compared to $(680) million in the first half of 2017. Operating cash flow excluding the change in working capital at replacement cost in the first half of 2018 was $11,769 million, an increase of 17% compared to $10,021 million in the first half of 2017. Operating cash flow excluding the change in working capital at replacement cost and without financial charges in the first half of 2018 was $12,465 million, an increase of 19% compared to $10,483 million in the first half of 2017.The Group’s net cash flow was $5,117 million in the first half 2018 compared to $5,396 million in the first half 2017. Net investments increased by $2,027 million compared to the first half 2017 due to an increase in completed acquisitions, in line with the strategy of the Group to invest counter-cyclically in 2016-17. This well-timed investment effort was partially offset by a $1,748 million increase in operating cash flow before working capital changes.

D. PROFITABILITY

Return on equity for the twelve months ended June 30, 2018, was 10.9%, an increase compared to the same period a year ago.

in millions of dollars	07/01/2017 - 06/30/2018			04/01/2017 - 03/31/2018			01/01/2017- 12/31/2017
Adjusted net income		12,299			11,150			10,762
Adjusted shareholders’ equity		113,251			111,522			106,078
Return on equity (ROE)		10.9	%		10.0	%		10.1	%

Return on average capital employedwas 10.1% for the twelve months ended June 30, 2018, an increase compared to the same period a year ago.

in millions of dollars	07/01/2017 - 06/30/2018			04/01/2017 - 03/31/2018			01/01/2017- 12/31/2017
Adjusted net operating income		13,748			12,428			11,958
Adjusted capital employed		136,356			136,384			125,575
ROACE		10.1	%		9.1	%		9.4	%

⁵ Net cash flow = operating cash flow before working capital changes - net investments (including other transactions with non-controlling interests).

8

E. 2018 SENSITIVITIES*

	Scenario retained	Change	Estimated impact on adjusted net operating income	Estimated impact on cash flow
Dollar	$1.2/€	+/- $0.1 per €	-/+ $0.1 B	~$0 B
Brent	$50/b	+/- $10/b**	+/- $2.3 B	+/- $2.8 B
European refining margin indicator (ERMI)	$35/t	+/- $10/t	+/- $0.5 B	+/- $0.6 B

* Sensitivities are revised once per year upon publication of the previous year’s fourth quarter results. Sensitivities are estimates based on assumptions about the Group’s portfolio in 2018. Actual results could vary significantly from estimates based on the application of these sensitivities. The impact of the $-€ sensitivity on adjusted net operating income is essentially attributable to Refining & Chemicals.

**Assumes constant liquids price differentials.

F.SUMMARY AND OUTLOOK

Supported by inventory reductions and geopolitical tensions, Brent continued to trade at around $70/b at the start of the third quarter, despite the announced increase in production by OPEC. The Group, however, resolutely continues to implement programs to improve operational efficiency and to reduce its breakeven so as to remain profitable whatever the market context.

The Upstream is well positioned to take advantage of the increase in oil prices thanks to production growth which should be above 7% in 2018. It will benefit in the coming months from the start-ups of Kaombo, Tempa Rossa, Ichthys and Egina, which are all strong cash flow generators, as well as ramping production up at recent start-ups like Yamal LNG, Fort Hills and Timimoun.

Since the start of the third quarter, European refining margins have been around $35/t. While still favorable, petrochemical margins are lower in Europe compared to a year ago.

The cost reduction program is on track to surpass the $4 billion objective for the year and reach $4.2 billion of cost savings over the 2014-18 period. The Group confirms that investments (organic and net acquisitions) should be between $16-17 billion in 2018.

Conforming to the announced shareholder return policy, the Group will continue to buy back shares issued as scrip dividend to eliminate dilution. It will also continue to buy back additional shares for an amount of up to $5 billion over the period 2018-20.

9

FORWARD-LOOKING STATEMENTS

This document may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. 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”, “expects”, “anticipates”, “intends”, “plans”, “targets”, “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.

You should understand that 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 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;

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

• 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 international armed conflict, and trade and regulatory matters;

• 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, you should read the information set forth under “Item 3. -3.2 Risk Factors”, “Item 4. Information on the Company”, “Item 5. Operating and Financial Review and Prospects” and “Item 11. Quantitative and Qualitative Disclosures about Market Risk” in TOTAL’s Form 20-F for the year ended December 31, 2017.

10

OPERATING INFORMATION BY SEGMENT

• Exploration & Production

2Q18		1Q18		2Q17		2Q18 vs 2Q17			Combined liquids and gas production by region (kboe/d)	1H18		1H17		1H18 vs 1H17
	842		886		746		+13	%	Europe and Central Asia		864		776		+11	%
	672		673		656		+2	%	Africa		673		646		+4	%
	681		639		514		+33	%	Middle East and North Africa		660		524		+26	%
	401		371		344		+17	%	Americas		386		339		+14	%
	121		134		240		-49	%	Asia-Pacific		128		249		-49	%
	2,717		2,703		2,500		+9	%	Total production		2,710		2,534		+7	%
	616		724		597		+3	%	• Including equity affiliates		670		621		+8	%
2Q18		1Q18		2Q17		2Q18 vs 2Q17			Liquids production by region (kb/d)	1H18		1H17		1H18 vs 1H17
	332		299		266		+25	%	Europe and Central Asia		315		268		+17	%
	511		503		505		+1	%	Africa		507		495		+2	%
	539		501		376		+43	%	Middle East and North Africa		520		384		+36	%
	190		165		126		+51	%	Americas		177		126		+41	%
	11		13		26		-58	%	Asia-Pacific		12		28		-57	%
	1,582		1,481		1,298		+22	%	Total production		1,532		1,300		+18	%
	233		304		244		-5	%	• Including equity affiliates		268		254		+6	%
2Q18		1Q18		2Q17		2Q18 vs 2Q17			Gas production by region (Mcf/d)	1H18		1H17		1H18 vs 1H17
	2,754		3,157		2,592		+6	%	Europe and Central Asia		2,954		2,740		+8	%
	772		857		679		+14	%	Africa		815		696		+17	%
	787		761		763		+3	%	Middle East and North Africa		774		776		-
	1,192		1,158		1,223		-3	%	Americas		1,175		1,197		-2	%
	671		731		1,243		-46	%	Asia-Pacific		701		1,287		-46	%
	6,176		6,664		6,500		-5	%	Total production		6,419		6,696		-4	%
	2,026		2,257		1,829		+11	%	• Including equity affiliates		2,141		1,921		+11	%
2Q18		1Q18		2Q17		2Q18 vs 2Q17			Liquefied natural gas	1H18		1H17		1H18 vs 1H17
	2.47		2.50		2.67		-7	%	LNG sales* (Mt)		4.97		5.66		-12	%

* Sales, Group share, excluding trading; 2017 data restated to reflect volume estimates for Bontang LNG in Indonesia based on the 2017 SEC coefficient.

• Downstream (Refining & Chemicals and Marketing & Services)

2Q18		1Q18		2Q17*		2Q18 vs 2Q17			Petroleum product sales by region (kb/d)**	1H18		1H17*		1H18 vs 1H17
	1,942		1,902		2,020		-4	%	Europe		1,922		2,078		-7	%
	652		754		610		+7	%	Africa		703		587		+20	%
	802		760		654		+23	%	Americas		781		615		+27	%
	644		680		774		-17	%	Rest of world		662		765		-14	%
	4,040		4,096		4,057		-		Total consolidated sales		4,068		4,045		+1	%
	556		570		538		+3	%	• Including bulk sales		563		577		-2	%
	1,685		1,725		1,759		-4	%	• Including trading		1,705		1,724		-1	%

*2017 data restated.

** Includes share of TotalErg.

11

ADJUSTMENT ITEMS

• Adjustment items to net income (Group share)

2Q18			1Q18			2Q17			in millions of dollars	1H18			1H17
	(358	)		(195	)		(108	)	Special items affecting net income (Group share)		(553	)		128
	(2	)		(101	)		125		• Gain (loss) on asset sales		(103	)		2,264
	(46	)		(21	)		(54	)	• Restructuring charges		(67	)		(59	)
	(236	)		(12	)		(32	)	• Impairments		(248	)		(1,750	)
	(74	)		(61	)		(147	)	• Other		(135	)		(327	)
	517			(45	)		(310	)	After-tax inventory effect: FIFO vs. replacement cost		472			(255	)
	9			(8	)		(19	)	Effect of changes in fair value		1			(19	)
	168			(248	)		(437	)	Total adjustments affecting net income		(80	)		(146	)

INVESTMENTS — DIVESTMENTS

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars	1H18			1H17			1H18 vs 1H17
	2,780			2,620			3,949			-30	%	Organic investments		5,400			6,893			-22	%
	137			111			166			-17	%	• Capitalized exploration		248			277			-10	%
	140			171			443			-68	%	• Increase in non-current loans		311			601			-48	%
	(581	)		(416	)		(153	)		x3.8		• Repayment of non-current loans		(997	)		(340	)		x2.9
	426			3,688			103			x4.1		Acquisitions		4,114			650			x6.3
	693			2,169			207			x3.3		Asset sales		2,862			2,918			-2	%
	—			—			—			—		Other transactions with non-controlling interests		—			—			—
	2,513			4,139			3,845			-35	%	Net investments		6,652			4,625			+44	%

CASH FLOW

2Q18			1Q18			2Q17			2Q18 vs 2Q17			in millions of dollars	1H18			1H17			1H18 vs 1H17
	6,797			5,668			5,581			+22	%	Operating cash flow before working capital changes w/o financial charges (DACF)		12,465			10,483			+19	%
	(398	)		(298	)		(247	)		+61	%	• Financial charges		(696	)		(462	)		+51	%
	6,399			5,370			5,334			+20	%	Operating cash flow before working capital changes (a)		11,769			10,021			+17	%
	(856	)		(3,222	)		(268	)		n/a		• (Increase) decrease in working capital		(4,078	)		(322	)		n/a
	703			(67	)		(426	)		n/a		• Inventory effect		636			(358	)		n/a
	6,246			2,081			4,640			+35	%	Cash flow from operations		8,327			9,341			-11	%
	2,780			2,620			3,949			-30	%	Organic investments (b)		5,400			6,893			-22	%
	3,619			2,750			1,385			x2.6		Free cash flow after organic investments, w/o net asset sales (a-b)		6,369			3,128			x2
	2,513			4,139			3,845			-35	%	Net investments (c)		6,652			4,625			+44	%
	3,886			1,231			1,489			x2.6		Net cash flow (a-c)		5,117			5,396			-5	%

12

GEARING RATIOS

in millions of dollars	06/30/2018			03/31/2018			06/30/2017
Current borrowings		15,659			14,909			13,070
Net current financial assets		(2,806	)		(1,920	)		(3,377	)
Net financial assets classified as held for sale		0			0			(2	)
Non-current financial debt		38,362			40,257			41,548
Hedging instruments of non-current debt		(967	)		(1,154	)		(558	)
Cash and cash equivalents		(26,475	)		(30,092	)		(28,720	)
Net debt (a)		23,773			22,000			21,961
Shareholders’ equity – Group share		117,975			121,187			107,188
Non-controlling interests		2,288			2,499			2,772
Shareholders’ equity (b)		120,263			123,686			109,960
Net-debt-to-equity ratio = a/b		19.8	%		17.8	%		20.0	%
Net-debt-to-capital ratio = a/(a+b)		16.5	%		15.1	%		16.6	%

RETURN ON AVERAGE CAPITAL EMPLOYED

• Twelve months ended June 30, 2018

in millions of dollars	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services
Adjusted net operating income		8,114			637			3,447			1,787
Capital employed at 06/30/2017*		108,618			5,363			10,957			6,937
Capital employed at 06/30/2018*		118,715			4,442			12,939			7,040
ROACE		7.1	%		13.0	%		28.9	%		25.6	%

• Twelve months ended March 31, 2018

in millions of dollars	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services
Adjusted net operating income		6,786			539			3,487			1,742
Capital employed at 03/31/2017*		106,937			5,036			11,130			6,331
Capital employed at 03/31/2018*		119,035			5,237			13,428			7,409
ROACE		6.0	%		10.5	%		28.4	%		25.4	%

• Twelve months ended June 30, 2017

in millions of dollars	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services
Adjusted net operating income		4,529			479			3,931			1,584
Capital employed at 06/30/2016*		107,405			4,622			12,249			5,789
Capital employed at 06/30/2017*		108,618			5,363			10,957			6,937
ROACE		4.2	%		9.6	%		33.9	%		24.9	%

* At replacement cost (excluding after-tax inventory effect).

13

MAIN INDICATORS

Chart updated around the middle of the month following the end of each quarter.

	€/$		Brent ($/b)		Average liquids price*** ($/b)		Average gas price ($/Mbtu)***		ERMI*  ($/t)**
Second quarter 2018		1.19		74.4		69.5		4.49		34.7
First quarter 2018		1.23		66.8		60.4		4.73		25.6
Fourth quarter 2017		1.18		61.3		57.6		4.23		35.5
Third quarter 2017		1.17		52.1		48.9		4.05		48.2
Second quarter 2017		1.10		49.6		45.1		3.93		41.0

*	European Refining Margin Indicator (“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.
**	$1/t = $0.136/b.
***	Consolidated subsidiaries, excluding fixed margin contracts, including hydrocarbon production overlifting/underlifting position valued at market price

Disclaimer: data is based on TOTAL’s reporting, is not audited and is subject to change.

14

Consolidated statement of income – half-yearly

TOTAL

(unaudited)

(M$)(a)	1sthalf 2018			1sthalf 2017
Sales		102,151			81,098
Excise taxes		(12,757	)		(10,523	)
Revenues from sales		89,394			70,575
Purchases, net of inventory variation		(60,045	)		(47,385	)
Other operating expenses		(13,698	)		(12,272	)
Exploration costs		(362	)		(396	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(6,351	)		(7,377	)
Other income		775			2,895
Other expense		(603	)		(397	)
Financial interest on debt		(868	)		(676	)
Financial income and expense from cash & cash equivalents		(95	)		(48	)
Cost of net debt		(963	)		(724	)
Other financial income		561			513
Other financial expense		(329	)		(319	)
Net income (loss) from equity affiliates		1,587			858
Income taxes		(3,683	)		(1,165	)
Consolidated net income		6,283			4,806
Group share		6,357			4,886
Non-controlling interests		(74	)		(80	)
Earnings per share ($)		2.39			1.93
Fully-diluted earnings per share ($)		2.38			1.92
(a) Except for per share amounts.

15

Consolidated statement of comprehensive income – half-yearly

TOTAL

(unaudited)

(M$)	1sthalf 2018			1sthalf 2017
Consolidated net income		6,283			4,806
Other comprehensive income
Actuarial gains and losses		67			158
Change in fair value of investments in equity instruments		5			—
Tax effect		(18	)		(53	)
Currency translation adjustment generated by the parent company		(2,630	)		5,464
Items not potentially reclassifiable to profit and loss		(2,576	)		5,569
Currency translation adjustment		968			(1,418	)
Available for sale financial assets		—			—
Cash flow hedge		255			34
Variation of foreign currency basis spread		(27	)		—
Share of other comprehensive income of equity affiliates, net amount		(132	)		(463	)
Other		(2	)		—
Tax effect		(75	)		(9	)
Items potentially reclassifiable to profit and loss		987			(1,856	)
Total other comprehensive income (net amount)		(1,589	)		3,713
Comprehensive income		4,694			8,519
Group share		4,806			8,581
Non-controlling interests		(112	)		(62	)

16

Consolidated statement of income – quarterly

TOTAL

(unaudited)

(M$)(a)	2nd quarter 2018			1st quarter 2018			2nd quarter 2017
Sales		52,540			49,611			39,915
Excise taxes		(6,438	)		(6,319	)		(5,433	)
Revenues from sales		46,102			43,292			34,482
Purchases, net of inventory variation		(30,599	)		(29,446	)		(23,398	)
Other operating expenses		(6,761	)		(6,937	)		(6,106	)
Exploration costs		(158	)		(204	)		(199	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(3,435	)		(2,916	)		(2,798	)
Other income		252			523			570
Other expense		(413	)		(190	)		(106	)
Financial interest on debt		(478	)		(390	)		(345	)
Financial income and expense from cash & cash equivalents		(54	)		(41	)		(37	)
Cost of net debt		(532	)		(431	)		(382	)
Other financial income		321			240			285
Other financial expense		(159	)		(170	)		(159	)
Net income (loss) from equity affiliates		1,103			484			310
Income taxes		(2,087	)		(1,596	)		(472	)
Consolidated net income		3,634			2,649			2,027
Group share		3,721			2,636			2,037
Non-controlling interests		(87	)		13			(10	)
Earnings per share ($)		1.38			1.00			0.79
Fully-diluted earnings per share ($)		1.38			0.99			0.79
(a) Except for per share amounts.

17

Consolidated statement of comprehensive income – quarterly

TOTAL

(unaudited)

(M$)	2nd quarter 2018			1st quarter 2018			2nd quarter 2017
Consolidated net income		3,634			2,649			2,027
Other comprehensive income
Actuarial gains and losses		42			25			32
Change in fair value of investments in equity instruments		(2	)		7			—
Tax effect		(20	)		2			(12	)
Currency translation adjustment generated by the parent company		(4,761	)		2,131			4,524
Items not potentially reclassifiable to profit and loss		(4,741	)		2,165			4,544
Currency translation adjustment		1,330			(362	)		(1,218	)
Available for sale financial assets		—			—			1
Cash flow hedge		77			178			(79	)
Variation of foreign currency basis spread		2			(29	)		—
Share of other comprehensive income of equity affiliates, net amount		36			(168	)		(794	)
Other		(2	)		—			(3	)
Tax effect		(27	)		(48	)		30
Items potentially reclassifiable to profit and loss		1,416			(429	)		(2,063	)
Total other comprehensive income (net amount)		(3,325	)		1,736			2,481
Comprehensive income		309			4,385			4,508
Group share		450			4,356			4,507
Non-controlling interests		(141	)		29			1

18

Consolidated balance sheet

TOTAL

(M$)	June 30, 2018			March 31, 2018			December 31, 2017			June 30, 2017
ASSETS	(unaudited)			(unaudited)						(unaudited)
Non-current assets
Intangible assets, net		24,562			24,502			14,587			14,119
Property, plant and equipment, net		114,047			116,181			109,397			112,659
Equity affiliates : investments and loans		22,443			22,332			22,103			21,705
Other investments		1,396			1,710			1,727			1,483
Non-current financial assets		967			1,154			679			558
Deferred income taxes		5,348			5,519			5,206			4,981
Other non-current assets		3,384			3,633			3,984			4,411
Total non-current assets		172,147			175,031			157,683			159,916
Current assets
Inventories, net		18,392			17,006			16,520			14,273
Accounts receivable, net		16,974			17,774			14,893			12,923
Other current assets		14,408			14,824			14,210			14,034
Current financial assets		3,609			2,289			3,393			3,618
Cash and cash equivalents		26,475			30,092			33,185			28,720
Assets classified as held for sale		—			—			2,747			421
Total current assets		79,858			81,985			84,948			73,989
Total assets		252,005			257,016			242,631			233,905
LIABILITIES & SHAREHOLDERS’ EQUITY
Shareholders’ equity
Common shares		8,305			8,207			7,882			7,797
Paid-in surplus and retained earnings		121,896			120,559			112,040			110,305
Currency translation adjustment		(9,764	)		(6,413	)		(7,908	)		(10,314	)
Treasury shares		(2,462	)		(1,166	)		(458	)		(600	)
Total shareholders’ equity - Group share		117,975			121,187			111,556			107,188
Non-controlling interests		2,288			2,499			2,481			2,772
Total shareholders’ equity		120,263			123,686			114,037			109,960
Non-current liabilities
Deferred income taxes		11,969			11,943			10,828			10,920
Employee benefits		3,329			3,796			3,735			4,127
Provisions and other non-current liabilities		18,807			19,268			15,986			16,924
Non-current financial debt		38,362			40,257			41,340			41,548
Total non-current liabilities		72,467			75,264			71,889			73,519
Current liabilities
Accounts payable		25,021			24,836			26,479			21,914
Other creditors and accrued liabilities		17,792			17,952			17,779			14,862
Current borrowings		15,659			14,909			11,096			13,070
Other current financial liabilities		803			369			245			241
Liabilities directly associated with the assets classified as held for sale		—			—			1,106			339
Total current liabilities		59,275			58,066			56,705			50,426
Total liabilities & shareholders’ equity		252,005			257,016			242,631			233,905

19

Consolidated statement of cash flow

TOTAL

(unaudited)

(M$)	1sthalf 2018			1sthalf 2017
CASH FLOW FROM OPERATING ACTIVITIES
Consolidated net income		6,283			4,806
Depreciation, depletion, amortization and impairment		6,554			7,590
Non-current liabilities, valuation allowances and deferred taxes		149			(247	)
(Gains) losses on disposals of assets		(273	)		(2,383	)
Undistributed affiliates’ equity earnings		(557	)		206
(Increase) decrease in working capital		(4,078	)		(322	)
Other changes, net		249			(309	)
Cash flow from operating activities		8,327			9,341
CASH FLOW USED IN INVESTING ACTIVITIES
Intangible assets and property, plant and equipment additions		(9,178	)		(6,001	)
Acquisitions of subsidiaries, net of cash acquired		(714	)		(325	)
Investments in equity affiliates and other securities		(308	)		(956	)
Increase in non-current loans		(311	)		(601	)
Total expenditures		(10,511	)		(7,883	)
Proceeds from disposals of intangible assets and property, plant and equipment		2,282			80
Proceeds from disposals of subsidiaries, net of cash sold		(4	)		2,696
Proceeds from disposals of non-current investments		584			142
Repayment of non-current loans		997			340
Total divestments		3,859			3,258
Cash flow used in investing activities		(6,652	)		(4,625	)
CASH FLOW USED IN FINANCING ACTIVITIES
Issuance (repayment) of shares:
- Parent company shareholders		482			421
- Treasury shares		(1,740	)
Dividends paid:
- Parent company shareholders		(4,208	)		(2,000	)
- Non-controlling interests		(84	)		(76	)
Issuance of perpetual subordinated notes
Payments on perpetual subordinated notes		(266	)		(219	)
Other transactions with non-controlling interests
Net issuance (repayment) of non-current debt		(2,428	)		346
Increase (decrease) in current borrowings		969			(2,580	)
Increase (decrease) in current financial assets and liabilities		(624	)		1,637
Cash flow used in financing activities		(7,899	)		(2,471	)
Net increase (decrease) in cash and cash equivalents		(6,224	)		2,245
Effect of exchange rates		(486	)		1,878
Cash and cash equivalents at the beginning of the period		33,185			24,597
Cash and cash equivalents at the end of the period		26,475			28,720

20

Consolidated statement of cash flow

TOTAL

(unaudited)

(M$)	2nd quarter 2018			1st quarter 2018			2nd quarter 2017
CASH FLOW FROM OPERATING ACTIVITIES				��
Consolidated net income		3,634			2,649			2,027
Depreciation, depletion, amortization and impairment		3,508			3,046			2,930
Non-current liabilities, valuation allowances and deferred taxes		35			114			(50	)
(Gains) losses on disposals of assets		(148	)		(125	)		(151	)
Undistributed affiliates’ equity earnings		(298	)		(259	)		501
(Increase) decrease in working capital		(856	)		(3,222	)		(268	)
Other changes, net		371			(122	)		(349	)
Cash flow from operating activities		6,246			2,081			4,640
CASH FLOW USED IN INVESTING ACTIVITIES
Intangible assets and property, plant and equipment additions		(3,513	)		(5,665	)		(3,323	)
Acquisitions of subsidiaries, net of cash acquired		12			(726	)		(6	)
Investments in equity affiliates and other securities		(146	)		(162	)		(433	)
Increase in non-current loans		(140	)		(171	)		(443	)
Total expenditures		(3,787	)		(6,724	)		(4,205	)
Proceeds from disposals of intangible assets and property, plant and equipment		304			1,978			74
Proceeds from disposals of subsidiaries, net of cash sold		(7	)		3
Proceeds from disposals of non-current investments		396			188			133
Repayment of non-current loans		581			416			153
Total divestments		1,274			2,585			360
Cash flow used in investing activities		(2,513	)		(4,139	)		(3,845	)
CASH FLOW USED IN FINANCING ACTIVITIES
Issuance (repayment) of shares:
- Parent company shareholders		473			9			406
- Treasury shares		(1,182	)		(558	)
Dividends paid:
- Parent company shareholders		(2,692	)		(1,516	)		(1,462	)
- Non-controlling interests		(72	)		(12	)		(61	)
Issuance of perpetual subordinated notes
Payments on perpetual subordinated notes		(116	)		(150	)		(90	)
Other transactions with non-controlling interests
Net issuance (repayment) of non-current debt		52			(2,480	)		290
Increase (decrease) in current borrowings		(738	)		1,707			(1,167	)
Increase (decrease) in current financial assets and liabilities		(1,779	)		1,155			979
Cash flow used in financing activities		(6,054	)		(1,845	)		(1,105	)
Net increase (decrease) in cash and cash equivalents		(2,321	)		(3,903	)		(310	)
Effect of exchange rates		(1,296	)		810			1,504
Cash and cash equivalents at the beginning of the period		30,092			33,185			27,526
Cash and cash equivalents at the end of the period		26,475			30,092			28,720

21

Consolidated statement of changes in shareholders’ equity

TOTAL

(unaudited)

	Common shares issued				Paid-in surplus and			Currency			Treasury shares						Shareholders’			Non-			Total
(M$)	Number		Amount		retained earnings			translation adjustment			Number			Amount			equity - Group Share			controlling interests			shareholders’ equity
As of January 1, 2017		2,430,365,862		7,604		105,547			(13,871	)		(10,587,822	)		(600	)		98,680			2,894			101,574
Net income of the first half  2017		—		—		4,886			—			—			—			4,886			(80	)		4,806
Other comprehensive Income		—		—		138			3,557			—			—			3,695			18			3,713
Comprehensive Income		—		—		5,024			3,557			—			—			8,581			(62	)		8,519
Dividend		—		—		(3,297	)		—			—			—			(3,297	)		(76	)		(3,373	)
Issuance of common shares		71,170,026		193		3,103			—			—			—			3,296			—			3,296
Purchase of treasury shares		—		—		—			—			—			—			—			—			—
Sale of treasury shares(a)		—		—		—			—			4,000			—			—			—			—
Share-based payments		—		—		74			—			—			—			74			—			74
Share cancellation		—		—		—			—			—			—			—			—			—
Issuance of perpetual subordinated notes		—		—		—			—			—			—			—			—			—
Payments on perpetual subordinated notes		—		—		(142	)		—			—			—			(142	)		—			(142	)
Other operations with non-controlling interests		—		—		(7	)		—			—			—			(7	)		7			—
Other items		—		—		3			—			—			—			3			9			12
As of June 30,  2017		2,501,535,888		7,797		110,305			(10,314	)		(10,583,822	)		(600	)		107,188			2,772			109,960
Net income of the second half 2017		—		—		3,745			—			—			—			3,745			(252	)		3,493
Other comprehensive Income		—		—		580			2,406			—			—			2,986			26			3,012
Comprehensive Income		—		—		4,325			2,406			—		��	—			6,731			(226	)		6,505
Dividend		—		—		(3,695	)		—			—			—			(3,695	)		(65	)		(3,760	)
Issuance of common shares		27,453,728		85		1,328			—			—			—			1,413			—			1,413
Purchase of treasury shares		—		—		—			—			—			—			—			—			—
Sale of treasury shares(a)		—		—		(142	)		—			2,207,066			142			—			—			—
Share-based payments		—		—		77			—			—			—			77			—			77
Share cancellation		—		—		—			—			—			—			—			—			—
Issuance of perpetual subordinated notes		—		—		—			—			—			—			—			—			—
Payments on perpetual subordinated notes		—		—		(160	)		—			—			—			(160	)		—			(160	)
Other operations with non-controlling interests		—		—		(1	)		—			—			—			(1	)		(3	)		(4	)
Other items		—		—		3			—			—			—			3			3			6
As of December 31, 2017		2,528,989,616		7,882		112,040			(7,908	)		(8,376,756	)		(458	)		111,556			2,481			114,037
Net income of the first half 2018		—		—		6,357			—			—			—			6,357			(74	)		6,283
Other comprehensive Income		—		—		305			(1,856	)		—			—			(1,551	)		(38	)		(1,589	)
Comprehensive Income		—		—		6,662			(1,856	)		—			—			4,806			(112	)		4,694
Dividend		—		—		(4,070	)		—			—			—			(4,070	)		(84	)		(4,154	)
Issuance of common shares		136,887,716		423		7,270			—			—			—			7,693			—			7,693
Purchase of treasury shares		—		—		—			—			(33,056,514	)		(2,004	)		(2,004	)		—			(2,004	)
Sale of treasury shares(a)		—		—		—			—			3,450			—			—			—			—
Share-based payments		—		—		192			—			—			—			192			—			192
Share cancellation		—		—		—			—			—			—			—			—			—
Issuance of perpetual subordinated notes		—		—		—			—			—			—			—			—			—
Payments on perpetual subordinated notes		—		—		(161	)		—			—			—			(161	)		—			(161	)
Other operations with non-controlling interests		—		—		(4	)		—			—			—			(4	)		4			—
Other items		—		—		(33	)		—			—			—			(33	)		(1	)		(34	)
As of June 30,  2018		2,665,877,332		8,305		121,896			(9,764	)		(41,429,820	)		(2,462	)		117,975			2,288			120,263
(a)Treasury shares related to the restricted stock grants.

22

TOTAL

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FIRST SIX MONTHS OF 2018

(unaudited)

1)Accounting policies

The consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and IFRS as published by the International Accounting Standards Board (IASB).

The interim consolidated financial statements of TOTAL S.A. and its subsidiaries (the Group) as of June 30, 2018, are presented in U.S. dollars and have been prepared in accordance with International Accounting Standard (IAS) 34 “Interim Financial Reporting”.

The accounting principles applied for the consolidated financial statements atJune 30, 2018, are consistent with those used for the financial statements at December 31, 2017, with the exception of those texts or amendments that must be applied for periods beginning January 1, 2018.

- First-time application of IFRS 15 “Revenue from Contracts with Customers”

The Group applied IFRS 15 as of January 1, 2018, without restating comparative information from past periods. The cumulative effect of the first application of the standard, recognized in equity as at January 1, 2018, is non-material.

The new standard does not lead to any material change in the accounting principles applied by the Group.

- First time application of IFRS 9 “Financial Instruments”

The Group applied IFRS 9 as of January 1, 2018 without restating comparative information from past periods. The impacts related to the first application of the standard, recognized in opening equity at January 1, 2018, are not material.

This standard has three components: classification and measurement of financial instruments, impairment of financial assets, and hedging transactions except macro hedging.

The main changes induced by each component are the following:

1. The application of the “Classification and valuation of financial instruments” component led the Group to create a new non-recyclable component in its comprehensive income to record, from January 1, 2018, changes in the fair value of “Investments in equity instruments at the fair value through equity” previously classified as “Available-for-sale financial assets “under IAS 39.

2. The application of the “Impairment of financial assets” component has no significant impact for the Group on January 1, 2018.

3. The application of the “Hedging transactions” component led the Group to recognize in a separate component of the comprehensive income the changes in the Foreign Currency Basis Spread identified in the hedging relationships qualifying as a fair value hedge.

The application of the provisions of IFRS 9 “Financial Instruments” has no significant effect on the Group’s balance sheet, income statement and consolidated equity as of June 30, 2018.

The preparation of financial statements in accordance with IFRS for the closing as ofJune 30, 2018, requires the executive management to make estimates, assumptions and judgments that affect the information reported in the Consolidated Financial Statements and the Notes thereto.

These estimates, assumptions and judgments are based on historical experience and other factors believed to be reasonable at the date of preparation of the financial statements. They are reviewed on an on-going basis by the executive management and therefore could be revised as circumstances change or as a result of new information.

23

Different estimates, assumptions and judgments could significantly affect the information reported, and actual results may differ from the amounts included in the Consolidated Financial Statements and the Notes thereto.

The main estimates, judgments and assumptions relate to the estimation of hydrocarbon reserves in application of the successful efforts method for the oil and gas activities, the impairment of assets, the employee benefits, the asset retirement obligations and the income taxes. These estimates and assumptions are described in the Notes to the Consolidated Financial Statements as of December 31, 2017.

Furthermore, when the accounting treatment of a specific transaction is not addressed by any accounting standard or interpretation, the executive management applies its judgment to define and apply accounting policies that provide informationconsistent with the general IFRS concepts: faithful representation, relevance and materiality.

As regards the application of IFRS 16 “Leases” on January 1, 2019, the Group intends to:

- apply the simplified retrospective transition method, by accounting for the cumulative effect of the initial application of the standard at the date of first application, without restating the comparative periods

- use the following simplification measures provided by the standard in the transitional provisions:

o not apply the standard to contracts that the Group had not previously identified as containing a lease under IAS 17 and IFRIC 4,

o not take into account leases whose term ends within 12 months of the date of first application

- recognize each lease component of the lease as a separate lease, apart from non-lease components (services) of the lease.

24

2)Changes in the Group structure

2.1) Main acquisitions and divestments

Exploration & Production

• On January 15, 2018, as part of the Strategic Alliance signed in March 2017, TOTAL announced the conclusion of transfer agreements from Petrobras to TOTAL:

o 35% of the rights, as well as the role of operator in the Lapa field,

o 22.5% of the rights of the Iara area.

The amount of this transaction is $ 1.95 billion.

The details of the acquisition are presented in Note 2.2 to the consolidated financial statements.

• On March 1, 2018, TOTAL finalized the acquisition of Marathon Oil Libya Limited which holds a 16.33% stake in the Waha Concessions in Libya. This transaction amounts to $ 451 million.

The details of the acquisition are presented in Note 2.2 to the consolidated financial statements.

• On March 8, 2018, TOTAL announced the closing of the Maersk Oil acquisition signed on August 21, 2017. The integration of Maersk Oil, which holds a portfolio of high quality assets, largely complementary to those held by TOTAL, and mainly located in OECD countries, allows the Group to become the second largest operator in the North Sea.

The details of the acquisition are presented in Note 2.2 to the consolidated financial statements.

• On March 15, 2018, TOTAL finalized the sale to Statoil of all of its interests in the Martin Linge field (51%) and the discovery of Garantiana (40%) on the Norwegian Continental Shelf.

• On March 18, 2018, TOTAL was awarded participating interests in two Offshore Concessions on Umm Shaif & Nasr (20%) and Lower Zakum (5%) in return for the payment of a global bonus of $ 1.45 billion.

• On April 11, 2018, TOTAL acquired several assets located in the Gulf of Mexico as part of the Cobalt International Energy company’s bankruptcy auction sale.

Marketing & Services

• In January, 2018, the sale of the joint venture TotalErg (Erg 51%, TOTAL 49%) to the Italian company API was finalized.

25

2.2)Major business combinations

In accordance with IFRS 3, TOTAL is assessing the fair value of identifiable acquired assets, liabilities and contingent liabilities on the basis of available information. This assessment will be finalised within 12 months following the acquisition date.

Exploration & Production

• Transfer of rights in the Lapa and Iara concessions in Brazil

On January 15, 2018 Petrobras transferred to TOTAL 35% of the rights of the Lapa field which was put in production in December 2016, with a 100,000 barrel per day capacity FPSO.

Petrobras also transferred to TOTAL 22.5% of the rights of the Iara area. Production in Iara is expected to start in 2018 and 2019 depending on the fields.

The acquisition cost amounts to $1,950 million.

In the balance sheet as of June 30, 2018, the provisional fair value of identifiable acquired assets, liabilities and contingent liabilities amounts to $1,950 million.

The provisional purchase price allocation is shown below :

($ million)	At the acquisition date
Intangible assets	1,072
Tangible assets	1,662
Other assets and liabilities	(119	)
Net debt	(665	)
Fair value of consideration transferred	1,950

• Marathon Oil Lybia Limited

On March 1, 2018, TOTAL finalized the acquisition of Marathon Oil Libya Limited which holds a 16.33% stake in the Waha Concessions in Libya. The acquisition cost amounts to $451 million.

In the balance sheet as of June 30, 2018, the provisional fair value of identifiable acquired assets, liabilities and contingent liabilities amounts to $451 million.

The provisional purchase price allocation is shown below :

($ million)	At the acquisition date
Intangible assets	326
Tangible assets	192
Other assets and liabilities	(91	)
Net debt	24
Fair value of consideration transferred	451

• Maersk Oil

On March 8, 2018, TOTAL finalized the acquisition of Maersk Oil, following the signature of the « Share Transfer Agreement » on August 21, 2017.

The Group acquired all the voting rights of Maersk Olie og Gas A/S (Maersk Oil), a wholly owned subsidiary of A.P. Møller – Mærsk A/S (Maersk), for a purchase consideration of $5,741 million.

26

This includes the fair value ($5,585 million) of 97,522,593 shares issued in exchange for all Maersk Oil shares, calculated using the market price of the company’s shares of 46.11 euros on the Euronext Paris Stock Exchange at its opening of business on March 8, 2018, and the amount of price adjustments ($156 million) paid on closing.

In the balance sheet as of June 30, 2018, the provisional fair value of identifiable acquired assets, liabilities and contingent liabilities amounts to $3,113 million.

The Group recognized a $2,628 million goodwill.

The provisional purchase price allocation is shown below:

($ million)	At the acquisition date
Goodwill	2,628
Intangible assets	4,227
Tangible assets	4,033
Other assets and liabilities	(3,223	)
Including provision for site restitution	(2,100	)
Including deferred tax	(675	)
Net debt	(1,924	)
Fair value of consideration transferred	5,741

27

3)Adjustment items

Description of the business segments

Financial information by business segment is reported in accordance with the internal reporting system and shows internal segment information that is used to manage and measure the performance of TOTAL and which is reviewed by the main operational decision-making body of the Group, namely the Executive Committee.

The operational profit and assets are broken down by business segment prior to the consolidation and inter-segment adjustments.

Sales prices between business segments approximate market prices.

The organization of the Group’s activities is structured around the four followings segments:

- An Exploration & Production segment;

- A Gas, Renewables & Power segment including downstream Gas activities, New Energies activities (excluding biotechnologies) and Energy Efficiency division;

- A Refining & Chemicals segment constituting a major industrial hub comprising the activities of refining, petrochemicals and specialty chemicals. This segment also includes the activities of oil Supply, Trading and marine Shipping;

- A Marketing & Services segment including the global activities of supply and marketing in the field of petroleum products;

In addition the Corporate segment includes holdings operating and financial activities.

Adjustment items

Performance indicators excluding the adjustment items, such as adjusted operating income, adjusted net operating income, and adjusted net income are meant to facilitate the analysis of the financial performance and the comparison of income between periods.

Adjustment items include:

(i) Special items

Due to their unusual nature or particular significance, certain transactions qualified as “special items” are excluded from the business segment figures. In general, special items relate to transactions that are significant, infrequent or unusual. However, in certain instances, transactions such as restructuring costs or assets disposals, which are not considered to be representative of the normal course of business, may be qualified as special items although they may have occurred within prior years or are likely to occur again within the coming years.

(ii)The inventory valuation effect

The adjusted results of the Refining & Chemicals and Marketing & Services segments are presented according to the replacement cost method. This method is used to assess the segments’ performance and facilitate the comparability of the segments’ performance with those of its competitors.

In the replacement cost method, which approximates the LIFO (Last-In, First-Out) 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 prices differential between one period and another or the average prices of the period rather than the historical value. The inventory valuation effect is the difference between the results according to the FIFO (First-In, First-Out) and the replacement cost.

(iii)Effect of changes in fair value

The effect of changes in fair value presented as adjustment items reflects for some transactions differences between internal measure of performance used by TOTAL’s management and the accounting for these transactions under IFRS.

IFRS 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 based on forward prices.

28

Furthermore, TOTAL, in its trading activities, enters into storage contracts, which future effects are recorded at fair value in Group’s internal economic performance. IFRS precludes recognition of this fair value effect.  

The adjusted results (adjusted operating income, adjusted net operating income, adjusted net income) are defined as replacement cost results, adjusted for special items and the effect of changes in fair value.

The detail of the adjustment items is presented in the table below.

ADJUSTMENTS TO OPERATING INCOME
(M$)		Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Total
2nd quarter  2018	Inventory valuation effect		—			—			569			134			—			703
	Effect of changes in fair value		—			16			—			—			—			16
	Restructuring charges		—			—			—			—			—			—
	Asset impairment charges		—			(424	)		—			—			—			(424	)
	Other items		(97	)		(1	)		—			—			—			(98	)
Total			(97	)		(409	)		569			134			—			197
2nd quarter  2017	Inventory valuation effect		—			—			(372	)		(54	)		—			(426	)
	Effect of changes in fair value		—			(27	)		—			—			—			(27	)
	Restructuring charges		(40	)		—			—			—			—			(40	)
	Asset impairment charges		(15	)		1			—			—			—			(14	)
	Other items		(77	)		(25	)		(39	)		(26	)		(64	)		(231	)
Total			(132	)		(51	)		(411	)		(80	)		(64	)		(738	)
1st half 2018	Inventory valuation effect		—			—			531			105			—			636
	Effect of changes in fair value		—			5			—			—			—			5
	Restructuring charges		(53	)		—			—			—			—			(53	)
	Asset impairment charges		—			(446	)		—			—			—			(446	)
	Other items		(97	)		(93	)		—			—			(9	)		(199	)
Total			(150	)		(534	)		531			105			(9	)		(57	)
1st half 2017	Inventory valuation effect		—			—			(289	)		(69	)		—			(358	)
	Effect of changes in fair value		—			(27	)		—			—			—			(27	)
	Restructuring charges		(40	)		—			—			—			—			(40	)
	Asset impairment charges		(1,869	)		(25	)		(50	)		—			—			(1,944	)
	Other items		(77	)		(114	)		(65	)		(26	)		(64	)		(346	)
Total			(1,986	)		(166	)		(404	)		(95	)		(64	)		(2,715	)

29

ADJUSTMENTS TO NET INCOME, GROUP SHARE
(M$)		Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Total
2nd quarter  2018	Inventory valuation effect		—			—			436			81			—			517
	Effect of changes in fair value		—			9			—			—			—			9
	Restructuring charges		(44	)		(2	)		—			—			—			(46	)
	Asset impairment charges		—			(236	)		—			—			—			(236	)
	Gains (losses) on disposals of assets		(2	)		—			—			—			—			(2	)
	Other items		(71	)		(3	)		—			—			—			(74	)
Total			(117	)		(232	)		436			81			—			168
2nd quarter  2017	Inventory valuation effect		—			—			(268	)		(42	)		—			(310	)
	Effect of changes in fair value		—			(19	)		—			—			—			(19	)
	Restructuring charges		(12	)		(3	)		(39	)		—			—			(54	)
	Asset impairment charges		(27	)		(5	)		—			—			—			(32	)
	Gains (losses) on disposals of assets		—			—			—			125			—			125
	Other items		(50	)		(11	)		(26	)		(18	)		(42	)		(147	)
Total			(89	)		(38	)		(333	)		65			(42	)		(437	)
1st half 2018	Inventory valuation effect		—			—			412			60			—			472
	Effect of changes in fair value		—			1			—			—			—			1
	Restructuring charges		(59	)		(8	)		—			—			—			(67	)
	Asset impairment charges		—			(248	)		—			—			—			(248	)
	Gains (losses) on disposals of assets		(103	)		—			—			—			—			(103	)
	Other items		(51	)		(58	)		(17	)		—			(9	)		(135	)
Total			(213	)		(313	)		395			60			(9	)		(80	)
1st half 2017	Inventory valuation effect		—			—			(210	)		(45	)		—			(255	)
	Effect of changes in fair value		—			(19	)		—			—			—			(19	)
	Restructuring charges		(12	)		(8	)		(39	)		—			—			(59	)
	Asset impairment charges		(1,641	)		(59	)		(50	)		—			—			(1,750	)
	Gains (losses) on disposals of assets		—			—			2,139			125			—			2,264
	Other items		(144	)		(78	)		(45	)		(18	)		(42	)		(327	)
Total			(1,797	)		(164	)		1,795			62			(42	)		(146	)

30

4)Shareholders’ equity

Treasury shares (TOTAL shares held by TOTAL S.A.)

In accordance with the February 2018 announcements regarding the shareholder return policy over 2018-2020, TOTAL S.A. started share buybacks.

At June 30, 2018, TOTAL S.A. holds 41,429,820 of its own shares, representing 1.55% of its share capital, detailed as follows:

• 8,760,020 shares allocated to TOTAL share grant plans for Group employees;

• 69,759 shares intended to be allocated to new TOTAL share purchase option plans or to new share grant plans;

• 32,600,041 shares acquired and intended to be canceled out of which:

o 9,820,488 shares definitively acquired during the first quarter and intended to be canceled,

o 18,576,360 shares definitively acquired during the second quarter and intended to be canceled,

o 4,203,193 shares corresponding to the portion not yet executed on June 30, 2018, of the share buyback for which the group is contractually bound.

These shares are deducted from the consolidated shareholders’ equity.

Dividend

The Annual Shareholders’ Meeting on June 1, 2018 approved the payment of a dividend of €2.48 per share for the 2017 fiscal year. Taking into account the three interim dividends of €0.62 per share that have been paid on October 12, 2017, January 11 and April 9, 2018, the remaining balance of €0.62 per share was paid on June 28, 2018.

The Annual Shareholders’ Meeting on June 1, 2018 approved that shareholders will be given the option to receive the 2017 final dividend in new shares or in cash. The share price of new shares has been set at €52.03 per share. This price is equal to the average opening price on Euronext Paris for the twenty trading days preceding June 1st, 2018, the date of the Annual Shareholders’ Meeting, reduced by the amount of the final dividend, without any discount. On June 28, 2018, 5,798,335 shares have been issued at a price of €52.03 per share.

Another resolution has been approved at the Annual Shareholders’ Meeting on June 1, 2018, if one or more interim dividends are decided by the Board of Directors for the fiscal year 2018, then shareholders will be given the option to receive this or these interim dividends in new shares or in cash.

The Board of Directors, during its April 25, 2018, meeting, decided to set the first interim dividend for the fiscal year 2018 at €0.64 per share. This interim dividend will be paid in cash or in shares on October 12, 2018 (the ex-dividend date will be September 25, 2018).

The Board of Directors, during its July 25, 2018, meeting, decided to set the second interim dividend for the fiscal year 2018 at €0.64 per share. This interim dividend will be paid in cash or in shares on December 18, 2018 (the ex-dividend date will be January 10, 2019).

Earnings per share in Euro

Earnings per share in Euro, calculated from the earnings per share in U.S. dollars converted at the average Euro/USD exchange rate for the period, amounted to €1.16 per share for the 2^nd quarter 2018 (€0.81 per share for the 1^st quarter 2018 and €0.71 per share for the 2^nd quarter 2017). Diluted earnings per share calculated using the same method amounted to €1.16 per share for the 2^nd quarter 2018 (€0.81 per share for the 1^st quarter 2018 and €0.71 per share for the 2^nd quarter 2017).

Earnings per share are calculated after remuneration of perpetual subordinated notes.

31

Other comprehensive income

Detail of other comprehensive income showing items reclassified from equity to net income is presented in the table below:

(M$)	1st half 2018					1st half 2017
Actuarial gains and losses				67					158
Change in fair value of investments in equity instruments				5					—
Tax effect				(18	)				(53	)
Currency translation adjustment generated by the parent company				(2,630	)				5,464
Sub-total items not potentially reclassifiable to profit and loss				(2,576	)				5,569
Currency translation adjustment				968					(1,418	)
- unrealized gain/(loss) of the period		1,078					(1,372	)
- less gain/(loss) included in net income		110					46
Available for sale financial assets				—					—
- unrealized gain/(loss) of the period		—					—
- less gain/(loss) included in net income		—					—
Cash flow hedge				255					34
- unrealized gain/(loss) of the period		142					164
- less gain/(loss) included in net income		(113	)				130
Variation of foreign currency basis spread				(27	)				—
- unrealized gain/(loss) of the period		(27	)				—
- less gain/(loss) included in net income		—					—
Share of other comprehensive income of equity affiliates, net amount				(132	)				(463	)
- unrealized gain/(loss) of the period		(93	)				(465	)
- less gain/(loss) included in net income		39					(2	)
Other				(2	)				—
Tax effect				(75	)				(9	)
Sub-total items potentially reclassifiable to profit and loss				987					(1,856	)
Total other comprehensive income, net amount				(1,589	)				3,713

32

Tax effects relating to each component of other comprehensive income are as follows:

	1sthalf 2018									1sthalf 2017
(M$)	Pre-tax amount			Tax effect			Net amount			Pre-tax amount			Tax effect			Net amount
Actuarial gains and losses		67			(18	)		49			158			(53	)		105
Change in fair value of investments in equity instruments		5			—			5			—			—			—
Currency translation adjustment generated by the parent company		(2,630	)		—			(2,630	)		5,464			—			5,464
Sub-total items not potentially reclassifiable to profit and loss		(2,558	)		(18	)		(2,576	)		5,622			(53	)		5,569
Currency translation adjustment		968			—			968			(1,418	)		—			(1,418	)
Available for sale financial assets		—			—			—			—			(1	)		(1	)
Cash flow hedge		255			(81	)		174			34			(8	)		26
Variation of foreign currency basis spread		(27	)		6			(21	)		—			—			—
Share of other comprehensive income of equity affiliates, net amount		(132	)		—			(132	)		(463	)		—			(463	)
Other		(2	)		—			(2	)		—			—			—
Sub-total items potentially reclassifiable to profit and loss		1,062			(75	)		987			(1,847	)		(9	)		(1,856	)
Total other comprehensive income		(1,496	)		(93	)		(1,589	)		3,775			(62	)		3,713

5)Financial debt

The Group has not issued any bond during the first six months of 2018.

The Group reimbursed bonds during the first six months of 2018:

- Bond 1.450% issued in 2013 and maturing in January 2018 (USD 1,000 million)

- Bond 2.500% issued in 2013 and maturing in June 2018 (NOK 600 million)

- Bond with floating rate coupon issued in 2014 and maturing in June 2018 (USD 135 million)

- Bond 3.125% issued in several tranches between 2006 / 2008 and maturing in June 2018 (CHF 525 million)

6)Related parties

The related parties are principally equity affiliates and non-consolidated investments. There were no major changes concerning transactions with related parties during the first six months of 2018.

33

7)Other risks and contingent liabilities

TOTAL is not currently aware of any exceptional event, dispute, risks or contingent liabilities that could have a material impact on the assets and liabilities, results, financial position or operations of the Group.

Alitalia

In the Marketing & Services segment, a civil proceeding was initiated in Italy, in 2013, against TOTAL S.A. and its subsidiary Total Aviazione Italia Srl before the competent Italian civil court. The plaintiff claims against TOTAL S.A., its subsidiary and other third parties, damages that it estimates to be nearly €908 million. This proceeding follows practices that had been condemned by the Italian competition authority in 2006. The parties have exchanged preliminary findings and a request for an expert opinion has been approved by the court. The existence and the assessment of the alleged damages in this procedure involving multiple defendants remain contested.

FERC

The Office of Enforcement of the U.S. Federal Energy Regulatory Commission (FERC) began in 2015 an investigation in connection with the natural gas trading activities in the United States of Total Gas & Power North America, Inc. (TGPNA), a U.S. subsidiary of the Group. The investigation covered transactions made by TGPNA between June 2009 and June 2012 on the natural gas market. TGPNA received a Notice of Alleged Violations from FERC on September 21, 2015. On April 28, 2016, FERC issued an order to show cause to TGPNA and two of its former employees, and to TOTAL S.A. and Total Gas & Power Ltd., regarding the same facts. TGPNA contests the claims brought against it.

A class action has been launched to seek damages from these three companies and was dismissed by a judgment of the U.S. District court of New York issued on March 15, 2017. The court of Appeal upheld this judgment.

Yemen

Due to the security conditions in the vicinity of Balhaf, Yemen LNG, in which the Group holds a stake of 39.62%, stopped its commercial production and export of LNG in April 2015, when it declared Force Majeure to its various stakeholders. The plant is in a preservation mode.

34

8)Information by business segment

(unaudited)

1st half 2018 (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		5,865			7,359			45,088			43,836			3			—			102,151
Intersegment sales		14,717			898			17,396			491			34			(33,536	)		—
Excise taxes		—			—			(1,714	)		(11,043	)		—			—			(12,757	)
Revenues from sales		20,582			8,257			60,770			33,284			37			(33,536	)		89,394
Operating expenses		(8,979	)		(8,096	)		(58,248	)		(31,919	)		(399	)		33,536			(74,105	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(4,834	)		(534	)		(617	)		(346	)		(20	)		—			(6,351	)
Operating income		6,769			(373	)		1,905			1,019			(382	)		—			8,938
Net income (loss) from equity affiliates and other items		1,210			162			417			193			9			—			1,991
Tax on net operating income		(3,322	)		(34	)		(383	)		(297	)		181			—			(3,855	)
Net operating income		4,657			(245	)		1,939			915			(192	)		—			7,074
Net cost of net debt																				(791	)
Non-controlling interests																				74
Net income - group share																				6,357
1st half 2018 (adjustments)(a) (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		—			13			—			—			—			—			13
Intersegment sales		—			—			—			—			—			—			—
Excise taxes		—			—			—			—			—			—			—
Revenues from sales		—			13			—			—			—			—			13
Operating expenses		(150	)		(101	)		531			105			(9	)		—			376
Depreciation, depletion and impairment of tangible assets and mineral interests		—			(446	)		—			—			—			—			(446	)
Operating income (b)		(150	)		(534	)		531			105			(9	)		—			(57	)
Net income (loss) from equity affiliates and other items		(167	)		(15	)		25			—			—			—			(157	)
Tax on net operating income		104			(4	)		(158	)		(35	)		—			—			(93	)
Net operating income (b)		(213	)		(553	)		398			70			(9	)		—			(307	)
Net cost of net debt																				(19	)
Non-controlling interests																				246
Net income - group share																				(80	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
(b)   Of which inventory valuation effect
- On operating income		—			—			531			105			—
- On net operating income		—			—			415			70			—

35

1st half 2018 (adjusted)  (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		5,865			7,346			45,088			43,836			3			—			102,138
Intersegment sales		14,717			898			17,396			491			34			(33,536	)		—
Excise taxes		—			—			(1,714	)		(11,043	)		—			—			(12,757	)
Revenues from sales		20,582			8,244			60,770			33,284			37			(33,536	)		89,381
Operating expenses		(8,829	)		(7,995	)		(58,779	)		(32,024	)		(390	)		33,536			(74,481	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(4,834	)		(88	)		(617	)		(346	)		(20	)		—			(5,905	)
Adjusted operating income		6,919			161			1,374			914			(373	)		—			8,995
Net income (loss) from equity affiliates and other items		1,377			177			392			193			9			—			2,148
Tax on net operating income		(3,426	)		(30	)		(225	)		(262	)		181			—			(3,762	)
Adjusted net operating income		4,870			308			1,541			845			(183	)		—			7,381
Net cost of net debt																				(772	)
Non-controlling interests																				(172	)
Adjusted net income - group share																				6,437
1st half 2018 (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Total expenditures		8,851			328			736			538			58			—			10,511
Total divestments		2,751			483			349			273			3			—			3,859
Cash flow from operating activities(*)		8,197			(75	)		(110	)		781			(466	)		—			8,327
(*)   As of January 1st, 2018, for a better reflection of the operating performance of the segments, financial expenses were all transferred to the Corporate segment. 2017 comparative information have been restated.

36

1st half 2017 (M$)	Exploration & Production			Gas, Renewables & Power			Refining &   Chemicals			Marketing &   Services			Corporate			Intercompany			Total
Non-Group sales		4,171			5,868			35,921			35,129			9			—			81,098
Intersegment sales		10,666			583			12,362			443			195			(24,249	)		—
Excise taxes		—			—			(1,381	)		(9,142	)		—			—			(10,523	)
Revenues from sales		14,837			6,451			46,902			26,430			204			(24,249	)		70,575
Operating expenses		(7,234	)		(6,326	)		(44,796	)		(25,394	)		(552	)		24,249			(60,053	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(6,412	)		(112	)		(532	)		(302	)		(19	)		—			(7,377	)
Operating income		1,191			13			1,574			734			(367	)		—			3,145
Net income (loss) from equity affiliates and other items		677			(32	)		2,601			288			16			—			3,550
Tax on net operating income		(951	)		(61	)		(498	)		(231	)		385			—			(1,356	)
Net operating income		917			(80	)		3,677			791			34			—			5,339
Net cost of net debt																				(533	)
Non-controlling interests																				80
Net income - group share																				4,886
1st half 2017 (adjustments)(a) (M$)	Exploration & Production			Gas, Renewables & Power			Refining &   Chemicals			Marketing &   Services			Corporate			Intercompany			Total
Non-Group sales		—			(27	)		—			—			—			—			(27	)
Intersegment sales		—			—			—			—			—			—			—
Excise taxes		—			—			—			—			—			—			—
Revenues from sales		—			(27	)		—			—			—			—			(27	)
Operating expenses		(117	)		(114	)		(354	)		(95	)		(64	)		—			(744	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(1,869	)		(25	)		(50	)		—			—			—			(1,944	)
Operating income(b)		(1,986	)		(166	)		(404	)		(95	)		(64	)		—			(2,715	)
Net income (loss) from equity affiliates and other items		(214	)		(79	)		2,156			126			—			—			1,989
Tax on net operating income		376			9			41			26			22			—			474
Net operating income(b)		(1,824	)		(236	)		1,793			57			(42	)		—			(252	)
Net cost of net debt																				(14	)
Non-controlling interests																				120
Net income - group share																				(146	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
(b)   Of which inventory valuation effect
- On operating income		—			—			(289	)		(69	)		—
- On net operating income		—			—			(212	)		(50	)		—

37

1st half 2017 (adjusted)  (M$)	Exploration & Production			Gas, Renewables   & Power			Refining & Chemicals			Marketing &   Services			Corporate			Intercompany			Total
Non-Group sales		4,171			5,895			35,921			35,129			9			—			81,125
Intersegment sales		10,666			583			12,362			443			195			(24,249	)		—
Excise taxes		—			—			(1,381	)		(9,142	)		—			—			(10,523	)
Revenues from sales		14,837			6,478			46,902			26,430			204			(24,249	)		70,602
Operating expenses		(7,117	)		(6,212	)		(44,442	)		(25,299	)		(488	)		24,249			(59,309	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(4,543	)		(87	)		(482	)		(302	)		(19	)		—			(5,433	)
Adjusted operating income		3,177			179			1,978			829			(303	)		—			5,860
Net income (loss) from equity affiliates and other items		891			47			445			162			16			—			1,561
Tax on net operating income		(1,327	)		(70	)		(539	)		(257	)		363			—			(1,830	)
Adjusted net operating income		2,741			156			1,884			734			76			—			5,591
Net cost of net debt																				(519	)
Non-controlling interests																				(40	)
Adjusted net income - group share																				5,032
1st half 2017 (M$)	Exploration & Production			Gas, Renewables   & Power			Refining & Chemicals			Marketing &   Services			Corporate			Intercompany			Total
Total expenditures		6,084			392			667			697			43			—			7,883
Total divestments		245			27			2,760			218			8			—			3,258
Cash flow from operating activities(*)		5,637			40			3,729			582			(647	)		—			9,341
(*)   As of January 1st, 2018, for a better reflection of the operating performance of the segments, financial expenses were all transferred to the Corporate segment. 2017 comparative information have been restated.

38

1st quarter 2018(M$)	Exploration & Production			Gas, Renewables & Power			Refining  & Chemicals			Marketing  & Services			Corporate			Intercompany			Total
Non-Group sales		2,467			4,091			21,739			21,308			6			—			49,611
Intersegment sales		6,924			468			7,956			198			97			(15,643	)		—
Excise taxes		—			—			(847	)		(5,472	)		—			—			(6,319	)
Revenues from sales		9,391			4,559			28,848			16,034			103			(15,643	)		43,292
Operating expenses		(4,045	)		(4,526	)		(27,879	)		(15,503	)		(277	)		15,643			(36,587	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,350	)		(70	)		(313	)		(174	)		(9	)		—			(2,916	)
Operating income		2,996			(37	)		656			357			(183	)		—			3,789
Net income (loss) from equity affiliates and other items		641			34			128			86			(2	)		—			887
Tax on net operating income		(1,550	)		(15	)		(104	)		(103	)		96			—			(1,676	)
Net operating income		2,087			(18	)		680			340			(89	)		—			3,000
Net cost of net debt																				(351	)
Non-controlling interests																				(13	)
Net income - group share																				2,636
1st quarter 2018 (adjustments)(a) (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing  & Services			Corporate			Intercompany			Total
Non-Group sales		—			(11	)		—			—			—			—			(11	)
Intersegment sales		—			—			—			—			—			—			—
Excise taxes		—			—			—			—			—			—			—
Revenues from sales		—			(11	)		—			—			—			—			(11	)
Operating expenses		(53	)		(92	)		(38	)		(29	)		(9	)		—			(221	)
Depreciation, depletion and impairment of tangible assets and mineral interests		—			(22	)		—			—			—			—			(22	)
Operating income (b)		(53	)		(125	)		(38	)		(29	)		(9	)		—			(254	)
Net income (loss) from equity affiliates and other items		(101	)		(11	)		(21	)		(1	)		—			—			(134	)
Tax on net operating income		58			3			19			3			—			—			83
Net operating income (b)		(96	)		(133	)		(40	)		(27	)		(9	)		—			(305	)
Net cost of net debt																				(10	)
Non-controlling interests																				67
Net income - group share																				(248	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
(b)   Of which inventory valuation effect
On operating income		—			—			(38	)		(29	)		—
On net operating income		—			—			(23	)		(27	)		—

39

1stquarter 2018 (adjusted) (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing   & Services			Corporate			Intercompany			Total
Non-Group sales		2,467			4,102			21,739			21,308			6			—			49,622
Intersegment sales		6,924			468			7,956			198			97			(15,643	)		—
Excise taxes		—			—			(847	)		(5,472	)		—			—			(6,319	)
Revenues from sales		9,391			4,570			28,848			16,034			103			(15,643	)		43,303
Operating expenses		(3,992	)		(4,434	)		(27,841	)		(15,474	)		(268	)		15,643			(36,366	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,350	)		(48	)		(313	)		(174	)		(9	)		—			(2,894	)
Adjusted operating income		3,049			88			694			386			(174	)		—			4,043
Net income (loss) from equity affiliates and other items		742			45			149			87			(2	)		—			1,021
Tax on net operating income		(1,608	)		(18	)		(123	)		(106	)		96			—			(1,759	)
Adjusted net operating income		2,183			115			720			367			(80	)		—			3,305
Net cost of net debt																				(341	)
Non-controlling interests																				(80	)
Adjusted net income - group share																				2,884
1st quarter 2018 (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing  & Services			Corporate			Intercompany			Total
Total expenditures		5,871			249			332			228			44			—			6,724
Total divestments		2,251			78			25			228			3			—			2,585
Cash flow from operating activities (*)		3,569			(179	)		(1,109	)		(60	)		(140	)		—			2,081

(*) As of January 1st, 2018, for a better reflection of the operating performance of the segments, financial expenses were all transferred to the Corporate segment. 2017 comparative information have been restated.

40

2nd quarter 2018 (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		3,398			3,268			23,349			22,528			(3	)		—			52,540
Intersegment sales		7,793			430			9,440			293			(63	)		(17,893	)		—
Excise taxes		—			—			(867	)		(5,571	)		—			—			(6,438	)
Revenues from sales		11,191			3,698			31,922			17,250			(66	)		(17,893	)		46,102
Operating expenses		(4,934	)		(3,570	)		(30,369	)		(16,416	)		(122	)		17,893			(37,518	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,484	)		(464	)		(304	)		(172	)		(11	)		—			(3,435	)
Operating income		3,773			(336	)		1,249			662			(199	)		—			5,149
Net income (loss) from equity affiliates and other items		569			128			289			107			11			—			1,104
Tax on net operating income		(1,772	)		(19	)		(279	)		(194	)		85			—			(2,179	)
Net operating income		2,570			(227	)		1,259			575			(103	)		—			4,074
Net cost of net debt																				(440	)
Non-controlling interests																				87
Net income - group share																				3,721
2nd quarter 2018 (adjustments)(a) (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		—			24			—			—			—			—			24
Intersegment sales		—			—			—			—			—			—			—
Excise taxes		—			—			—			—			—			—			—
Revenues from sales		—			24			—			—			—			—			24
Operating expenses		(97	)		(9	)		569			134			—			—			597
Depreciation, depletion and impairment of tangible assets and mineral interests		—			(424	)		—			—			—			—			(424	)
Operating income(b)		(97	)		(409	)		569			134			—			—			197
Net income (loss) from equity affiliates and other items		(66	)		(4	)		46			1			—			—			(23	)
Tax on net operating income		46			(7	)		(177	)		(38	)		—			—			(176	)
Net operating income(b)		(117	)		(420	)		438			97			—			—			(2	)
Net cost of net debt																				(9	)
Non-controlling interests																				179
Net income - group share																				168
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
(b)   Of which inventory valuation effect
- On operating income		—			—			569			134			—
- On net operating income		—			—			438			97			—

41

2nd quarter 2018 (adjusted) (M$)	Exploration & Production			Gas, Renewables & Power				Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		3,398			3,244				23,349			22,528			(3	)		—			52,516
Intersegment sales		7,793			430				9,440			293			(63	)		(17,893	)		—
Excise taxes		—			—				(867	)		(5,571	)		—			—			(6,438	)
Revenues from sales		11,191			3,674				31,922			17,250			(66	)		(17,893	)		46,078
Operating expenses		(4,837	)		(3,561	)	��		(30,938	)		(16,550	)		(122	)		17,893			(38,115	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,484	)		(40	)			(304	)		(172	)		(11	)		—			(3,011	)
Adjusted operating income		3,870			73				680			528			(199	)		—			4,952
Net income (loss) from equity affiliates and other items		635			132				243			106			11			—			1,127
Tax on net operating income		(1,818	)		(12	)			(102	)		(156	)		85			—			(2,003	)
Adjusted net operating income		2,687			193				821			478			(103	)		—			4,076
Net cost of net debt																					(431	)
Non-controlling interests																					(92	)
Adjusted net income - group share																					3,553
2nd quarter 2018 (M$)	Exploration & Production			Gas, Renewables & Power				Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Total expenditures		2,980			79				404			310			14			—			3,787
Total divestments		500			405				324			45			—			—			1,274
Cash flow from operating activities(*)		4,628			104				999			841			(326	)		—			6,246
(*)   As of January 1st, 2018, for a better reflection of the operating performance of the segments, financial expenses were all transferred to the Corporate segment. 2017 comparative information have been restated.

42

2nd quarter 2017 (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		2,068			2,671			17,347			17,831			(2	)		—			39,915
Intersegment sales		5,118			274			6,016			169			90			(11,667	)		—
Excise taxes		—			—			(680	)		(4,753	)		—			—			(5,433	)
Revenues from sales		7,186			2,945			22,683			13,247			88			(11,667	)		34,482
Operating expenses		(3,547	)		(2,857	)		(21,918	)		(12,729	)		(319	)		11,667			(29,703	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,344	)		(40	)		(245	)		(158	)		(11	)		—			(2,798	)
Operating income		1,295			48			520			360			(242	)		—			1,981
Net income (loss) from equity affiliates and other items		487			13			148			258			(6	)		—			900
Tax on net operating income		(512	)		(24	)		(142	)		(123	)		214			—			(587	)
Net operating income		1,270			37			526			495			(34	)		—			2,294
Net cost of net debt																				(267	)
Non-controlling interests																				10
Net income - group share																				2,037
2nd quarter 2017 (adjustments)(a) (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		—			(27	)		—			—			—			—			(27	)
Intersegment sales		—			—			—			—			—			—			—
Excise taxes		—			—			—			—			—			—			—
Revenues from sales		—			(27	)		—			—			—			—			(27	)
Operating expenses		(117	)		(25	)		(411	)		(80	)		(64	)		—			(697	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(15	)		1			—			—			—			—			(14	)
Operating income(b)		(132	)		(51	)		(411	)		(80	)		(64	)		—			(738	)
Net income (loss) from equity affiliates and other items		(4	)		(16	)		(53	)		121			—			—			48
Tax on net operating income		47			9			129			21			22			—			228
Net operating income(b)		(89	)		(58	)		(335	)		62			(42	)		—			(462	)
Net cost of net debt																				(7	)
Non-controlling interests																				32
Net income - group share																				(437	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
(b)   Of which inventory valuation effect
- On operating income		—			—			(372	)		(54	)		—
- On net operating income		—			—			(270	)		(45	)		—

43

2nd quarter 2017 (adjusted) (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Non-Group sales		2,068			2,698			17,347			17,831			(2	)		—			39,942
Intersegment sales		5,118			274			6,016			169			90			(11,667	)		—
Excise taxes		—			—			(680	)		(4,753	)		—			—			(5,433	)
Revenues from sales		7,186			2,972			22,683			13,247			88			(11,667	)		34,509
Operating expenses		(3,430	)		(2,832	)		(21,507	)		(12,649	)		(255	)		11,667			(29,006	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,329	)		(41	)		(245	)		(158	)		(11	)		—			(2,784	)
Adjusted operating income		1,427			99			931			440			(178	)		—			2,719
Net income (loss) from equity affiliates and other items		491			29			201			137			(6	)		—			852
Tax on net operating income		(559	)		(33	)		(271	)		(144	)		192			—			(815	)
Adjusted net operating income		1,359			95			861			433			8			—			2,756
Net cost of net debt																				(260	)
Non-controlling interests																				(22	)
Adjusted net income - group share																				2,474
2nd quarter 2017 (M$)	Exploration & Production			Gas, Renewables & Power			Refining & Chemicals			Marketing & Services			Corporate			Intercompany			Total
Total expenditures		3,448			77			401			258			21			—			4,205
Total divestments		132			23			20			182			3			—			360
Cash flow from operating activities(*)		2,836			(100	)		1,967			251			(314	)		—			4,640
(*)   As of January 1st, 2018, for a better reflection of the operating performance of the segments, financial expenses were all transferred to the Corporate segment. 2017 comparative information have been restated.

44

9)Reconciliation of the information by business segment with consolidated financial statements

(unaudited)

							Consolidated
1st half 2018							statement of
(M$)	Adjusted			Adjustments(a)			income
Sales		102,138			13			102,151
Excise taxes		(12,757	)		—			(12,757	)
Revenues from sales		89,381			13			89,394
Purchases net of inventory variation		(60,623	)		578			(60,045	)
Other operating expenses		(13,496	)		(202	)		(13,698	)
Exploration costs		(362	)		—			(362	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(5,905	)		(446	)		(6,351	)
Other income		628			147			775
Other expense		(115	)		(488	)		(603	)
Financial interest on debt		(849	)		(19	)		(868	)
Financial income and expense from cash & cash equivalents		(95	)		—			(95	)
Cost of net debt		(944	)		(19	)		(963	)
Other financial income		561			—			561
Other financial expense		(329	)		—			(329	)
Net income (loss) from equity affiliates		1,403			184			1,587
Income taxes		(3,590	)		(93	)		(3,683	)
Consolidated net income		6,609			(326	)		6,283
Group share		6,437			(80	)		6,357
Non-controlling interests		172			(246	)		(74	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
							Consolidated
1st half 2017							statement
(M$)	Adjusted			Adjustments(a)			of income
Sales		81,125			(27	)		81,098
Excise taxes		(10,523	)		—			(10,523	)
Revenues from sales		70,602			(27	)		70,575
Purchases net of inventory variation		(46,929	)		(456	)		(47,385	)
Other operating expenses		(11,984	)		(288	)		(12,272	)
Exploration costs		(396	)		—			(396	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(5,433	)		(1,944	)		(7,377	)
Other income		314			2,581			2,895
Other expense		(116	)		(281	)		(397	)
Financial interest on debt		(662	)		(14	)		(676	)
Financial income and expense from cash & cash equivalents		(48	)		—			(48	)
Cost of net debt		(710	)		(14	)		(724	)
Other financial income		513			—			513
Other financial expense		(319	)		—			(319	)
Net income (loss) from equity affiliates		1,169			(311	)		858
Income taxes		(1,639	)		474			(1,165	)
Consolidated net income		5,072			(266	)		4,806
Group share		5,032			(146	)		4,886
Non-controlling interests		40			(120	)		(80	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.

45

							Consolidated
2nd quarter 2018							statement
(M$)	Adjusted			Adjustments(a)			of income
Sales		52,516			24			52,540
Excise taxes		(6,438	)		—			(6,438	)
Revenues from sales		46,078			24			46,102
Purchases net of inventory variation		(31,263	)		664			(30,599	)
Other operating expenses		(6,694	)		(67	)		(6,761	)
Exploration costs		(158	)		—			(158	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(3,011	)		(424	)		(3,435	)
Other income		254			(2	)		252
Other expense		(55	)		(358	)		(413	)
Financial interest on debt		(469	)		(9	)		(478	)
Financial income and expense from cash & cash equivalents		(54	)		—			(54	)
Cost of net debt		(523	)		(9	)		(532	)
Other financial income		321			—			321
Other financial expense		(159	)		—			(159	)
Net income (loss) from equity affiliates		766			337			1,103
Income taxes		(1,911	)		(176	)		(2,087	)
Consolidated net income		3,645			(11	)		3,634
Group share		3,553			168			3,721
Non-controlling interests		92			(179	)		(87	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.
							Consolidated
2nd quarter 2017							statement
(M$)	Adjusted			Adjustments(a)			of income
Sales		39,942			(27	)		39,915
Excise taxes		(5,433	)		—			(5,433	)
Revenues from sales		34,509			(27	)		34,482
Purchases net of inventory variation		(22,939	)		(459	)		(23,398	)
Other operating expenses		(5,868	)		(238	)		(6,106	)
Exploration costs		(199	)		—			(199	)
Depreciation, depletion and impairment of tangible assets and mineral interests		(2,784	)		(14	)		(2,798	)
Other income		206			364			570
Other expense		(58	)		(48	)		(106	)
Financial interest on debt		(338	)		(7	)		(345	)
Financial income and expense from cash & cash equivalents		(37	)		—			(37	)
Cost of net debt		(375	)		(7	)		(382	)
Other financial income		285			—			285
Other financial expense		(159	)		—			(159	)
Net income (loss) from equity affiliates		578			(268	)		310
Income taxes		(700	)		228			(472	)
Consolidated net income		2,496			(469	)		2,027
Group share		2,474			(437	)		2,037
Non-controlling interests		22			(32	)		(10	)
(a)   Adjustments include special items, inventory valuation effect and the effect of changes in fair value.

46

10)Post-closing and other events

Gas, Renewables & Power

• On July 6, 2018, TOTAL announced the closing of the acquisition of a 73.04% interest in Direct Energie for an estimated amount of €1.4 billion and on the same day filed a mandatory tender offer for the shares in Direct Energie not yet held by TOTAL.

• On July 13, 2018, TOTAL announced the closing of the acquisition of Engie’s portfolio of upstream liquefied natural gas (LNG) assets for an overall enterprise value of $1.5 billion.

47