SEC Company Response from Sanofi (SNY, SNYNF) (CIK 0001121404) (SNY) — Jan 14, 2020

Sanofi (SNY, SNYNF) (CIK 0001121404)
Date: Jan. 14, 2020 · CIK: 0001121404 · Accession: 0001193125-20-006792

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AI Filing Summary & Sentiment

File numbers found in text: 001-31368

Date

January 14, 2020

Author

Not clearly detected

Form

CORRESP

Company

Sanofi (SNY, SNYNF) (CIK 0001121404)

Letter

Division of Corporation Finance

Office of Life Sciences

100 F Street, NE

Washington, D.C. 20549

Attn: Lisa Vanjoske and Mary Mast

January 14, 2020

Form 20-F for the Fiscal Year Ended December 31, 2018

Filed March 8, 2019

File No. 001-31368

Ladies and Gentlemen:

We are responding to the comment letter of the Staff of the Division of Corporation Finance, Office of Life Sciences (the “Staff”) of the U.S. Securities and Exchange Commission (the “SEC” or “Commission”) that was conveyed to us on December 20, 2019 with respect to the filing referenced above. For the Staff’s convenience, the text of the Staff’s comment is set forth below in bold followed by our response.

Form 20-F for the Fiscal Year Ended December 31,

Financial Statements

Consolidated Statements of Changes in Equity, page F-6

You combine additional paid in capital and retained earnings in your Consolidated Statements of Changes in Equity. Please explain to us how this complies with IFRS. Conceptually, retained earnings represents earnings from your operating activities and not additional paid in capital generated from your capital raising activities. These two activities appear to differ fundamentally in nature and function, as discussed in paragraphs 58 and 78 of IAS 1, which also provides a specific example showing the disaggregation of equity capital into paid-in capital and share premium. In addition, paragraphs 108 and 109 of IAS 1 suggest that capital transactions with owners, such as equity contributions and reacquisition of an entity’s own equity instruments, are wholly distinct from income and expense, including gains and losses, generated from operating activities. We believe that your inclusion of additional paid in capital in retained earnings conflicts with this guidance.

Sanofi Response:

We note the Staff’s comments and will revise our Consolidated Statements of Changes in Equity by incorporating a separate column “Additional paid in capital” in our Form 20-F for the Fiscal Year ended December 31, 2019. An example of the revised Consolidated Statements of Changes in Equity for the fiscal year ended December 31, 2018 is provided below. Accordingly, the comparative period will also be revised.

(€ million)

Share capital

Additional paid-in capital

Treasury shares

Retained earnings

Stock options and other share-based payments

Other comprehensive income

Attributable to equity holders of Sanofi

Attributable to non- controlling interests

Total equity

Balance at January 1, 2018

2,508

(14 )

52,804

3,298

(584 )

58,070

58,239

First-time application of IFRS 9

—

(852 )

(13 )

—

(13 )

Other comprehensive income for the period

—

(305 )

—

1,268

(4 )

Net income for the period

—

4,306

—

4,306

4,410

Comprehensive income for the period

—

4,001

—

1,268

5,269

5,369

Dividend paid out of 2017 earnings (€3.03 per share)

—

(3,773 )

—

(3,773 )

—

(3,773 )

Payment of dividends to non-controlling interests

—

(97 )

Share repurchase program

—

(1,100 )

—

(1,100 )

—

(1,100 )

Reduction in share capital

(24 )

(213 )

(643 )

—

Share-based payment plans:

◆Exercise of stock options

—

◆Issuance of restricted shares and vesting of existing restricted shares

(4 )

(80 )

—

◆Employee share ownership plan

—

◆Proceeds from sale of treasury shares on exercise of stock options

—

◆Value of services obtained from employees

—

◆Tax effects of the exercise of stock options

—

Other changes arising from issuance of restricted shares

—

Change in non-controlling interests without loss of control

—

(68 )

—

(68 )

(65 )

Change in non-controlling interests arising from divestment

—

(16 )

Balance at December 31, 2018

2,495

(153 )

53,093

3,596

(168 )

58,876

59,035

In connection with our response to your comments, we acknowledge that the Company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the Staff.

Should you have any questions regarding this matter, please contact me.

By:

/s/ Laurent Gilhodes

Name: Laurent Gilhodes

Title: Head of Group Controlling

Show Raw Text

CORRESP
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filename1.htm

CORRESP

Division of Corporation Finance

 Office of Life Sciences

100 F Street, NE

Washington, D.C. 20549

Attn: Lisa Vanjoske and Mary Mast

January 14, 2020

 Form 20-F for the Fiscal Year Ended December 31, 2018

Filed March 8, 2019

 File No. 001-31368

 Ladies and Gentlemen:

We are responding to the comment letter of the Staff of the Division of Corporation Finance, Office of Life Sciences (the “Staff”) of the U.S.
Securities and Exchange Commission (the “SEC” or “Commission”) that was conveyed to us on December 20, 2019 with respect to the filing referenced above. For the Staff’s convenience, the text of the Staff’s comment
is set forth below in bold followed by our response.

 Form 20-F for the Fiscal Year Ended December 31,
2018

 Financial Statements

Consolidated Statements of Changes in Equity, page F-6

You combine additional paid in capital and retained earnings in your Consolidated Statements of Changes in Equity. Please explain to us how this complies
with IFRS. Conceptually, retained earnings represents earnings from your operating activities and not additional paid in capital generated from your capital raising activities. These two activities appear to differ fundamentally in nature and
function, as discussed in paragraphs 58 and 78 of IAS 1, which also provides a specific example showing the disaggregation of equity capital into paid-in capital and share premium. In addition, paragraphs 108
and 109 of IAS 1 suggest that capital transactions with owners, such as equity contributions and reacquisition of an entity’s own equity instruments, are wholly distinct from income and expense, including gains and losses, generated from
operating activities. We believe that your inclusion of additional paid in capital in retained earnings conflicts with this guidance.

 Sanofi
Response:

 We note the Staff’s comments and will revise our Consolidated Statements of Changes in Equity by incorporating a separate column
“Additional paid in capital” in our Form 20-F for the Fiscal Year ended December 31, 2019. An example of the revised Consolidated Statements of Changes in Equity for the fiscal year ended
December 31, 2018 is provided below. Accordingly, the comparative period will also be revised.

 (€ million)

Share
capital

Additional
paid-in
capital

Treasury
shares

Retained
earnings

Stock options
and other
share-based
payments

Other
comprehensive
income

Attributable
to equity
holders of
Sanofi

Attributable
to non-
controlling
interests

Total
equity

 Balance at January 1, 2018

2,508

58

(14
)

52,804

3,298

(584
)

58,070

169

58,239

 First-time application of IFRS 9

—

—

—

839

—

(852
)

(13
)

—

(13
)

 Other comprehensive income for the period

—

—

—

(305
)

—

1,268

963

(4
)

959

 Net income for the period

—

—

—

4,306

—

—

4,306

104

4,410

 Comprehensive income for the period

—

—

—

4,001

—

1,268

5,269

100

5,369

 Dividend paid out of 2017 earnings (€3.03 per share)

—

—

—

(3,773
)

—

—

(3,773
)

—

(3,773
)

 Payment of dividends
to non-controlling interests

—

—

—

—

—

—

—

(97
)

(97
)

 Share repurchase program

—

—

(1,100
)

—

—

—

(1,100
)

—

(1,100
)

 Reduction in share capital

(24
)

(213
)

880

(643
)

—

—

—

—

—

 Share-based payment plans:

 ◆Exercise of stock options

2

57

—

—

—

—

59

—

59

 ◆Issuance of restricted shares and vesting of existing restricted shares

4

(4
)

80

(80
)

—

—

—

—

—

 ◆Employee share ownership plan

5

115

—

—

—

—

120

—

120

 ◆Proceeds from sale of treasury shares on exercise of stock options

—

—

1

—

—

—

1

—

1

 ◆Value of services obtained from employees

—

—

—

—

284

—

284

—

284

 ◆Tax effects of the exercise of stock options

—

—

—

—

14

—

14

—

14

 Other changes arising from issuance of restricted shares

—

—

—

13

—

—

13

—

13

 Change in non-controlling interests without loss
of control

—

—

—

(68
)

—

—

(68
)

3

(65
)

 Change in non-controlling interests arising from
divestment

—

—

—

—

—

—

—

(16
)

(16
)

 Balance at December 31, 2018

2,495

13

(153
)

53,093

3,596

(168
)

58,876

159

59,035

 In connection with our response to your comments, we acknowledge that the Company and its management are
responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the Staff.

 Should
you have any questions regarding this matter, please contact me.

By:

 /s/ Laurent Gilhodes

Name: Laurent Gilhodes

Title: Head of Group Controlling

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