michelin individual shareholder’s guide 2011 edition · michelin individual shareholder’s guide...

MIchelIn IndIvIdual shareholder’s GuIde2011 edItIon

a neW Phase oF dYnaMIc GroWth

Contents_

To find out more, please visit the Finance section of our

www.michelin.com/corporate website.

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— 1

Interview with Michel rollier, Managing Partner2010 Business Review and Outlook.

— P. 01-03

— 2

Michelin at a glance Getting to know the Group, its Performance and Management Team.

— P. 04-19

— 4

In close touch with our shareholdersOngoing Dialogue for a Carefully Nurtured Relationship.

— P. 34-65

— 3

Business review and resultsTrends and Results by Key Market.

— P. 20-33

How was business in 2010?

MICHEL ROLLIER — Thanks to the remarkable dedication of our teams across the organi zation, Michelin amply benefited from the upturn in demand. Tire markets were up in all regions of the world. Our net sales rose by over 20%, with a more than 13% increase in volumes. Our operating margin came to 9.5%, based on record-high operating income of nearly €1.7 billion. Our net income exceeded €1 billion. The Horizon 2010 plan has delivered savings of over €1 billion over the last

the road around the world, and there’ll probably be 1.6 billion by 2030. This means that our markets are going to enjoy strong growth, as customer needs become increasingly diverse. In China, South America, India, Russia and the Middle East, growth could be as high as 10% a year. At the same time, the transportation industry is leading a profound transformation to spend less but more effectively, reduce costs and lessen environmental impacts. These new demands will enable the best in the indus-

five years, raised plant produc-tivity by 35% and spectacularly improved workplace safety, with the accident frequency rate hitting a record low of 1.19.

Michelin has emerged from the cri-sis stronger than ever and ready to capture all of its markets’ extraor-dinary growth potential. The suc-cess of the €1.2 billion rights issue carried out last October has given us the resources to do so.

How are your markets doing?

MICHEL ROLLIER — Today, there are 800 million vehicles on

interview with michel rollier

With its new phase of dynamic growth, Michelin is embarking on its most ambitious project in 30 years.”

1michelin - IndIvIduAl ShAREhOldER’S GuIdE - 2011 edition

try, like us, to make a difference.

How is Michelin positioned with regard to these changes?

MICHEL ROLLIER — The growth in the global tire market and the transportation industry’s ongoing response to the challenges of sustainable development present historic opportunities for Michelin.Geographically, the extensive capacity scheduled to come on stream in Brazil, China and India will enable us to capture all of the growth in these markets starting in 2012. Technologically, we have proactively responded to changing demand by bringing to market lighter tires that deliver greater safety, longer tread life and better fuel efficiency. This balanced performance and the ability to simultaneously improve all of the different performance factors are unique to Michelin. In line with our vision of a better way forward, every day, our Michelin Performance and Responsibility approach is demonstrating its strength and effectiveness in meeting the challenges of tomor-row. Our decision in 2010 to pledge to support the united nations Global Compact further

strong, diversified growth. We’re aiming to increase sales volumes by 25% by 2015 and by 50% by 2020, by capturing share in the new markets and adding value to our products and services in mature markets. The second objective is to become more competitive. We now have increas-ingly efficient plants in the mature economies. We intend to build on these gains, by pursuing our continuous improvement process. We plan to invest €1.6 billion a year between 2011 and 2015 to support our growth and competi-tiveness targets. This is a much bigger commitment than before.The third objective is to main-tain our business performance. Our target for 2015 is operating income well in excess of €2 bil-lion, ROCE of more than 9% and positive free cash flow generated over the entire period.

What are your growth drivers?

MICHEL ROLLIER — The first one is our ability to satisfy the real needs of our customers through innovation. This has always been Michelin’s strength, and the new organizations will provide us with even greater leverage in this area.

Another powerful driver is the MIChElIn brand, with its extraor-dinary capital of trust and affinity. In fact, the brand will be the primary source of our growth, because it delivers the balanced performance that customers expect and society needs. At the same time, we plan to develop the market for affordable high-performance tires, which rep-resent more than 40% of the global market. Our growth in this segment will be spearheaded by our brand portfolio. In addition, growth will also be driven by our services, which we plan to enhance and diversify in order to build even stronger relations with all of our dealer and distribution stakeholders.Through our Michelin Performance and Responsibility approach, we will pursue our commitment to improving working conditions, training, diversity, partner relation-ships and the environmental foot-print of our production facilities.lastly, and most importantly, we are counting on the professional-ism and dedication of our employ-ees, who have enabled Michelin to overcome obstacles to become a world leader. With its 2011-2015

highlights our commitment to responsible development.

Raw materials costs are rising sharply. Will you be able to pass them on in your prices?

MICHEL ROLLIER — That’s what we did throughout 2010. We are determined to protect our margins and we’re in a good position to do so, thanks to the superior advantages that we offer both to carmakers, in terms of environmental performance, and to users, in terms of safety, longevity and fuel efficiency. As regulations become stricter and raw materials and energy become more expensive, the quality of our products and services will become more valuable. As proof, just look at 2010, when we sold more MIChElIn brand passenger car and light truck tires than ever before, in both mature and fast growing markets.

In October, you presented your new phase of dynamic growth for the 2011-2015 period. What are your objec-tives in this phase?

MICHEL ROLLIER — Our strategy for the next five years hinges on three main objectives. The first is

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strategic plan, Michelin is embark-ing on its most ambitious project in 30 years. It will be supported by our Moving Forward Together program, which embodies our shared dedication to success. I am quite confident that we will indeed succeed.

You have also announced that you are preparing your succession, even though your term runs until 2017. Isn’t this premature?

MICHEL ROLLIER — On the con-trary, I feel this is exactly the right time. The reins should be handed over smoothly in the best interests of the Company, its shareholders and its employees. I discussed my decision thoughtfully and at great length with the Supervisory Board. Jean-dominique Senard and I have worked closely togeth-er for six years, and I’ve come to appreciate his qualities, both as a person and as a business leader. Shareholders will be asked to elect him as Managing General Partner at the Extraordinary Meeting on May 13, 2011. I would also like Michelin’s corporate governance to be adjusted, so I’m going to recommend expanding the Super-

visory Board’s role and limiting the term of future Managing Partners to four years, renewable one or more times.

In practical terms, how will the transition be organized?

MICHEL ROLLIER — If share-holders approve these recom-mendations at the Extraordinary General Meeting, I will remain Managing General Partner until Jean-dominique Senard replaces me and didier Miraton will remain non-General Managing Partner. I will continue to serve in my cur-rent position for 18 months to two years and, once the transition is completed, I can retire. I’m certain that Jean-dominique Senard and didier Miraton will then be able to lead the Group with the requi-site skills and vision, in complete accordance with Michelin’s values.

michel rollier

3

111,090employees (105,057 full-time equivalents)

e17.9 Bnin net sales

70

production facilities in 18 countries

michelinat a glance

a new PhaSe oF dYnamic growth

— With its high-quality products and services, attractive brands, outstanding operating performance and robust balance sheet, Michelin has emerged from the recent recession stronger than ever, thanks to the dedication of its employees, the loyalty of its customers, and the lasting trust of its shareholders.By 2030, the number of vehicles worldwide will have doubled and road mobility will have to substantially reduce its energy consumption and its environmental impact. Both of these trends represent powerful growth drivers for Michelin. A pioneer and active promoter of sustainable mobility and one of the few global tiremakers, Michelin has embarked on a new phase of dynamic growth. To meet the challenges that lie ahead, the Group can leverage such core strengths as its technological leadership, its capacity for innovation and the power of the Michelin Performance and Responsibility approach. Throughout, the organization will remain sharply focused on helping to enhance mobility while creating value for customers, employees, shareholders and society as a whole.

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MIChElInAT A GlAnCE

COntEnts— Corporate Profile p. 06— Challenges and strategy p. 08— Corporate Governance p. 16— Control p. 18

5michelin - MIChElIn IndIvIduAl ShAREhOldER’S GuIdE - 2011 edition

corPorate ProFile— Michelin holds forefront positions in every tire market(1) as well as in travel-related services.

— Leveraging its technological lead, capacity for innovation, high-quality products and services, and powerful brands, the Group is pursuing a global expansion strategy and improving efficiency in every aspect of its business.

— Its corporate mission is to secure its sustainable growth in order to help improve mobility and create value for customers, employees and shareholders

(1) With a 15.5% share of the global market by value according to Tire Business 2010 Global Tire Company Rankings.

a comPrehenSive brand PortFolio— A global brand: MIChElIn.

— A primary brand dedicated to sports cars and Suvs: BFGoodrich®.

— Strong regional brands: unIROYAl in north America, KlEBER in Europe and WARRIOR in China.

— Market-leading national brands.

— Retread solutions.

— Product and service dealership networks.

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an eFFicient organiZation

— 8 Product Lines, each with its own marketing, development, production and sales resources.

— A technology Center in charge of research, development and process engineering, with operations in Europe, north America and Asia.

— 2 Integrated tire Dealership networks: Euromaster and TCI.

— 2 specialty Units: viaMichelin and Michelin lifestyle.

— 8 Regions: north America, South America, Western Europe, Eastern Europe, ASEAn/Australia, China, Japan/South Korea and Africa/India/Middle East.

— 13 Corporate Departments that support the Product lines and the Technology Center and impel general corporate policies.

— 4 Performance Divisions: Research-development-Process Engineering, Manufacturing, Sales and Marketing, and Supply Chain and logistics

ProductS and ServiceS that Set the Standard For qualitY and reliabilitY

For its customers the world over, Michelin delivers diversified and innovative products and services designed to facilitate mobility across the full range of applications.

tires for cars, vans, trucks, farm tractors, handling and construction equipment, motorcycles, scooters, bicycles, aircraft, subway trains, trams and space shuttles, with innovative solutions tailored to widely varying conditions of use and expectations.

Distribution and services, with the integrated Euromaster (Europe) and TCI (united States) dealership networks and the TyrePlus franchises or brand partnerships for car tires in Asia, the Middle East, Russia, Australia and Mexico.

Customer assistance services with Michelin OnWay and Michelin Euro Assist.

Fleet tire advice and management services with Michelin Fleet Solutions in Europe and Michelin Business Solutions in north America.

MIChElIn maps and guides and viaMichelin mobility assistance services.

Michelin Lifestyle products developed in partnership with licensees: car and bike accessories, work, sport and leisure gear, and collectibles.


the right tire changes everything

The global advertising campaign, starring the famed Michelin Man, was rolled out in 55 countries on five continents in 2010.

challengeS and StrategY — With the 2011-2015 strategic plan’s focus on growth, competitiveness and commitment, our strategic vision is designed to deliver strong, diversified growth by capturing the full value of our products and services in mature markets and expanding more quickly in new markets. As we continue to make our organization more competitive and cost-effective, the mutual commitment of the Company and its employees will enable us to successfully move forward together.

800 MILLIOn vEHICLEs tODAY1.5 BILLIOn vEHICLEs BY 2030In million units

Sources : OCdE, IRF, FMI, IhS Global Insight.

2050203020101990

3,000

2,500

2,000

1,500

1,000

500

0

Passenger cars

Commercial vehicles

Total vehicles

Road mobility is a key driver of economic development but its growth poses enormous challenges in the areas of safety, energy, the climate and the environment, where expectations are high and the sense of urgency is growing. The transportation industry is undergoing a radical transformation. For Michelin, the challenge is to fully leverage both our skill in identifying emerging needs and our innovation capabilities to develop cleaner, safer, more fuel-efficient road mobility solutions that make optimum use of information and communication technologies. This is our corporate mission.

the Future ShaPe oF mobilitY

8

The shift in demand towards China, India, Brazil, Russia and the Middle East, along with competitive pressures and changing needs in Europe and north America are having a fundamental impact on manufacturing strategies. We will need to build new capacity in fast-growing regions and to improve our competitiveness and responsiveness in mature markets.

Everywhere in the world, we need to be close to our customers. That’s why instilling a real culture of diversity provides a significant competitive advantage. At the same time, growing globalization of purchasing and production calls for heightened vigilance with regard to working conditions.

the 10th Michelin Challenge Bibendum was held in Rio de Janeiro in 2010. The world’s leading sustainable mobility event, Challenge Bibendum enables carmakers, auto equipment manufacturers, energy companies, research institutes and government agencies to exchange ideas about the future of mobility and to compare their leading edge technologies.

Us$ 3.2Bn

EstIMAtED vALUE OF tHE MICHELIn BRAnD

Brand Finance® 2010.

MICHELIn, n0 1 FOR PERCEIvED qUALItY In 10 MAjOR MARkEts

KeePing Pace with the ShiFt in demand

our core StrengthS

We have a number of strengths that will help us meet the challenge of sustainable mobility and support a new phase of dynamic growth:

— the MICHELIn brand is recognized for its superior performance in delivering enhanced safety, longevity and fuel efficiency, pushing the boundaries in all these performance metrics.

— As technological leader, Michelin is constantly raising the performance bar in ways that impact both consumer standards and tire regulations.

— Michelin is a global player, with operations in all countries and leading positions in all markets.

— the Group boasts a healthy balance sheet following the successful €1.2 billion share issue carried out in October 2010.

— It is deploying a balanced growth strategy, coordinated by the Michelin Performance and Responsibility approach, delivering benefits for all stakeholders.

— Asia has five times as many people as Western Europe and the united States combined, yet only 49 cars per 1,000 residents.


INNOVATING AND CREATING

COMPETITIVE DIFFERENTIATION

Michelin is the tire industry’s biggest investor in inno-vation, developing technological responses to the challenges of higher raw materials and energy costs, and stricter safety and environmental standards.

Our Technology Center is deploying facilities around the world to better anticipate customer needs and align products and services with local demand. New work organizations are being put in place to drive faster, more efficient innovation. This is being achieved by promoting dialogue between the Research-Development-Process Engineering and Strategic Marketing teams, generating feed-back from customers and other market players throughout the innovation process and complet-ing the process-engineering phase more quickly.

LEVERAGING GROWTH DRIVERS

While our growth strategy is underpinned by sales of MICHELIN-brand products and services, it is being enhanced by a multi-brand portfolio focused on the fast-growing segment of competi-tively priced tires for high-performance vehicles. Our market access strategy helps to impel this growth, with a target of 1,000 Euromaster fran-chise outlets in Europe by 2015 and 1,800 TyrePlus centers in the new markets. The retread business is also being actively expanded, to encourage the truck market shift to radial tires.

A

STEPPED UP CAPITAL EXPENDITURE

A total of €1.1 billion was spent in 2010 and the 2011-2015 strategic plan provides for €1.6 billion in capital spending per year to:

— Sharply increase production capacity in fast-growing markets.

— Align manufacturing operations with demand in mature markets and increase competitiveness.

— Set up information systems that enable us to meet our operational excellence and service quality objectives.

Three high-capacity plants are under construction to serve vibrant emerging markets:

— Pau Brasil, a car and light truck tire plant in Brazil.

— Chennai, a truck and earthmover tire plant in India.

— Shenyang 2, a car and truck tire plant in China.

The three projects represent a total investment of €2.75 billion and will come on stream in 2012.

STRONG, DIVERSIFIED

GROWTH

— The Group is aiming for 25% growth in unit sales by 2015 and 50% by 2020. With its 2011-2015 strategic

plan, it is embarking on its most ambitious project in 30 years.

1010

leading the tire induStrY in r&d

— 6,000 employees, €500 million per year.

— 8,500 patents, three times more than 10 years ago.

— 100-million project to comprehensively upgrade the worldwide Technology Center in Clermont-Ferrand by 2016, with the construction of modern new buildings to house all of Michelin’s R&d teams on the same site.

www.michelin.com/ladoux

+25%GROWtH In UnIt sALEs BY 2015

40%OF sALEs In EMERGInG MARkEts BY 2015

+150,000 t AnnUAL GROWtH In PRODUCtIOn CAPACItY OvER tHE PERIOD 2011-2015

e1.6 Bn

In AnnUAL CAPItAL ExPEnDItURE In tHE PERIOD 2011-2015

Michelin, the world leader in fuel-efficient tires, pioneering the new product-service system.

1,000 tyrePlus centers in nine countries, in new growth regions.

Michelin has acquired 100% control of shanghai Michelin Warrior tire in China and tigar in serbia, and set up distribution partnerships with taqui Pneu in France and Rodi in spain.

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Architect’s plans for the new Technology Center in ladoux (France)


PowerFul manuFacturing

reSourceS in the weStern world

By consolidating production at larger, more specialized facilities, investing in productivity and deploying the Michelin Manufacturing Way (MMW), Michelin has assertively improved its manufacturing operations and created highly competitive plants in Europe and north America.

After the united States, Spain and Italy, the indus-trial reorganization plan in France has now been completed on schedule. All employees affected by the reorganization have received personalized support.

Plans are now underway to optimize the supply and distribution chains. This will drive further improvement in order fill rates, reduce inventories and deliver increased flexibility thanks to powerful synergies between our supply chain, logistics, sales and manufacturing operations.

a conStant commitment

to ProgreSS

Michelin is transforming its business processes to do things better, faster and at a lower cost, while aligning all of its teams behind its priority targets. From design, innovation and process engineering to project management, administration, logistics and customer relations, all of the major busi-ness processes are being reviewed with a focus on speed, simplicity, efficiency and employee empowerment.

The main performance indicators are accident frequency and severity, workstation ergonomics, customer satisfaction, materials waste, product quality, Michelin’s own cost and productivity met-rics and the Michelin site Environmental Footprint (MEF), a composite indicator that measures envi-ronmental impact.

enhanced comPetitiveneSS

— Michelin is leading a transformation program to improve competitiveness and reduce costs.

A total of €1.2 billion in savings were achieved between 2006 and 2010. As demand recovers, we are reaping the full

benefits of these cost efficiencies.

e1.2 Bn

In sAvInGs BEtWEEn 2006 AnD 2010.

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standardization is reducing capital project costs and speeding the ramp-up process.

doing thingS better at a lower coStRapid advances are being driven by widely used systems such as Bib standard, Bib Boost, Bib Flex, Bib Detect, Bib Innovation and Bib Ramp Up, which require little or no investment.

WEstERn EUROPE32 plants10 pclt sites12 tt sites7 st sites 6 component and semi-finished product sites51,356 employees*

EAstERn EUROPE8 plants5 pclt sites3 tt sites3 st sites1 component and semi-finished product site12,085 employees*

nORtH AMERICA18 plants10 pclt sites 4 tt sites 3 st sites2 component and semi-finished product sites20,994 employees*

sOUtH AMERICA4 plants2 pclt sites and 1 under construction3 tt sites1 st site5,086 employees*

AsIA7 plants4 pclt sites and 1 under construction3 tt sites and 1 under construction2 st sites2 component and semi-finished product sites14,458 employees*

AFRICA AnD tHE MIDDLE EAst1 plant1 tt site1,078 employees*

SPecialiZed PlantS in France- 4WD and light truck tires at Cholet- super sport and racing tires at Clermont-Ferrand - truck tires at joué-lès-tours - Earthmover tires, rubber compounds and metal

fabrics at Montceau-les-Mines- Aircraft tires at Bourges

Scale eFFiciencieS in manuFacturing oPerationSOver 50% of car and truck tires are manufactured at plants with a capacity of at least 100,000 tonnes, twice as many as in 2005.

*Full-time equivalent employees at december 31, 2010.

• PClT: passenger car and light truck tires• TT: truck and bus tires • ST: specialty tires

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a mutual commitment

Michelin is committed to enabling every employee to find fulfillment in his or her job responsibilities, to promoting diversity and to combating all forms of discrimination. Training policies allow each employee to continue to grow and develop throughout his or her career.

All employees receive performance-based compensation, with profit-sharing and bonus systems adapted to each country and job function. Michelin has also set up a stock option plan open to a broad range of managers and regularly carries out worldwide employee rights issues.

reSPecting emPloYeeS

Workplace safety is a priority concern, as reflected in the practices and performance that have given Michelin one of the best track records of any manufacturing company worldwide.

All possible measures are taken to limit short-time working, for example by launching preventive maintenance operations, organizing training courses, and asking staff to take their vacation early. When industrial reorganization programs are necessary, the employees concerned are offered solutions within the Group and personalized support.

michelin PerFormance

and reSPonSibilitY

Michelin is dedicated to enhancing mobility by basing its development on the core values of Respect for Customers, Respect for People, Respect for Shareholders, Respect for the Environment and Respect for Facts.

The Michelin Performance and Responsibility approach structures this corporate culture and coordinates our commitment to the principles of sustainable, balanced, responsible development. Ten major challenges have been selected for priority action, project leaders have been appointed and action plans have been launched, backed by indicators to measure progress and performance.

“moving Forward

together”

— The Michelin corporate community is made up of more than 110,000

people, representing 120 nationalities. Their diversity, professionalism

and commitment make them the driving force behind our performance

and development, supported by an employee relations process rooted in

dialogue and mutual respect.

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10 main areaS For imProvement— the responsible performance of Michelin products and services.

— the environmental impact of tire use.

— the recovery, reuse and disposal of end-of-life tires.

— team diversity.

— Relations with local communities.

— quality of worklife on the Group’s sites (ergonomics, safety).

— Environmental management of Michelin sites.

— Industrial risk management.

— Michelin’s contribution to sustainable mobility.

— Responsible procurement.

w a recogniZed commitmentIn 2010, Michelin pledged to support the United nations Global Compact and was included in the AsPI Eurozone, Ethibel Excellence Europe, DjsI World and DjsI Europe indices of companies with the highest sustainable development performance.

www.ethibel.org - www.sam-group.com

w The Michelin Performance and Responsibility Charter adopted in 2002 has been translated into 15 languages. In 2010, the “Michelin Performance and Responsibility: A Better Way Forward” brochure was published to show each employee how he or she can effectively contribute to the process every day.


A stABLE, REsPOnsIBLE MAnAGEMEnt tEAM The Group is managed by Michel Rollier, Managing General Par tner, and didier Miraton and Jean-dominique Senard, non-General Managing Partners. They are assisted by the Executive Council, comprised of seven executives responsible for the Product lines, Corporate Services and Performance divisions.

didier Miraton —• Born in 1958. • Graduate of Ponts et Chaussées engineering school.• Joined Michelin in 1982, spending most of his career working in research and innovation in France and the united States, with a focus on Truck, Earthmover and handling Equipment tire technologies.• Appointed Managing Director of the Michelin Technology Center and member of the Executive Council in 2001.• Managing Partner since May 11, 2007.

Michel Rollier —• Born in 1944. • Graduate of Institut d’Etudes Politiques (IEP) Paris, MA in law.• Joined Aussedat-Rey (a member of the International Paper Group) in 1971 as Financial Controller, going on to become head of an operating unit, then Chief Financial Officer from 1987 to 1994 and deputy Chief Executive Officer from 1994 to 1996.• Joined the Michelin Group in 1996.• Vice President, Finance and legal Affairs.• Appointed Chief Financial Officer and member of the Executive Council in October 1999.• Managing Partner since May 20, 2005.

Jean-dominique Senard —• Born in 1953.• Graduate of HEC business school, MA in law.• From 1979 to 1996, held various management positions in finance and operations at Total then Saint-Gobain.• Joined Pechiney in 1996 as Chief Financial Officer and member of the Executive Committee, then director, Primary Aluminum division, until 2004. Subsequently appointed as a member of Alcan Group’s Executive Committee and Chairman of Péchiney SA.• Joined Michelin in 2005 as Chief Financial Officer and member of the Executive Council. • Managing Partner since May 11, 2007.

managing PartnerS

corPorate governancea PartnerShiP Structure SuPPorting a long-term viSion—Tire manufacturing is a capital-intensive industry in which the pace of technological innovation is relatively slow. It is therefore essential to be able to devise long-term plans and follow them through. In France, incorporating as a partnership limited by shares (SCA) provides a legal framework aligned with this longer-term view. Organized as an SCA since its formation, Compagnie Générale des Etablissements Michelin (CGEM), the Group’s parent company, has found that this partnership model offers three main advantages:

- it supports the deployment of long-term strategies by a stable management team whose interests are aligned with those of shareholders ;

- it guarantees clear segregation of management and supervisory powers ;

- it fosters direct ties with each shareholder as all shares must be registered.

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Claire dorland-Clauzel —Communication and Brands.

Jean-Michel Guillon —human Resources.Organization.Also responsible for Security.

Jean-Christophe Guérin —Manufacturing Performance.Also responsible for overseeing Quality and Supply Chain operations.

Pete Selleck —Truck Tires.

Florent Ménégaux —Passenger Car and light truck tires.Also responsible for overseeing Racing.

Bernard vasdeboncœur—Speciality tires: Agriculture, Aviation, Two-wheel, Earthmovers, ComponentsAlso responsible for overseeing Procurement

eXecutive council

Éric de Cromières —Marketing and Sales Performance,Euromaster, TCI, Maps and Guides, viaMichelin, Michelin lifestyle.Also responsible for overseeing Information Systems.


050402 0603 07 0801

SuPerviSorY bodieS

the supervisory Board oversees Michelin’s management on an ongoing basis on behalf of the shareholders and reports to shareholders on its oversight activities at each Annual Meeting. It has eight members.

control— Independent Supervisory Bodies Reporting directly to Shareholders

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02

Benoît PotierIndEPEndEnT MEMBER

—Born in 1957 – FrenchMember of the Audit Committee3,117 Michelin shares

Benoît Potier has been with Air liquide for 25 years. he became Chief Executive Officer in 1997, Chairman of the Management Board in november 2001, and Chairman and Chief Executive Officer in May 2006.

08

louis GalloisIndEPEndEnT MEMBER

—Born in 1944 – French300 Michelin shares

louis Gallois is Chief Executive Officer of EAdS and President of the Airbus Shareholders Committee. he has served as Chairman of SnCF and held various positions in the aviation industry as well as at the Ministry of the Economy and Finance, the Ministry of Research and Industry, and the Ministry of defense.

07

Barbara dalibardIndEPEndEnT MEMBER


Barbara dalibard has been Chief Executive Officer of the French national railways’ travel division, SnCF voyages, since 2010. She was previously a member of the France Telecom Executive Committee, in charge of corporate communication services. Before that, she held various management positions at France Telecom and Alcatel.

03

François GrappotteIndEPEndEnT MEMBER

—Born in 1936 – FrenchChairman of the Audit Committee1,240 Michelin shares

After 20 years as Chief Executive Officer of legrand, François Grappotte served as non-executive Chairman beginning in 2004 and was named honorary Chairman on March 17, 2006.

04

laurence ParisotIndEPEndEnT MEMBER


After serving as Chief Executive Officer of the louis harris France Polling Institute (1986), laurence Parisot was named Chief Executive Officer of Institut Français de l’Opinion Publique (Ifop) in 1990. She was also Chairperson of Optimum until March 2006. Since July 2005, she has been President of the French employers federation (MEdEF).

01

Pat CoxIndEPEndEnT MEMBER

—Born in 1952 – Irish259 Michelin shares

Pat Cox was a Member of the house of Representatives of Ireland and a Member of the European Parliament, where he served as President from January 2002 to June 2004.

06

Éric Bourdais de CharbonnièreIndEPEndEnT MEMBER

—Born in 1939 – FrenchChairman of the Supervisory BoardMember of the Audit Committee3,198 Michelin shares

After 25 years with JP Morgan, where he was Chief Executive Officer for France, Éric Bourdais de Charbonnière served as Chief Financial Officer of Michelin from 1990 to 1999, when he retired. he has been Chairman of the Supervisory Board since 2000.

05

Pierre MichelinIndEPEndEnT MEMBER

—Born in 1949 – FrenchMember of the Audit Committee1,747 Michelin shares

After serving in Philips’ IT department, Pierre Michelin joined Groupe Bull, where he currently heads a division. Since 2003, he has also been a Professor of Information Systems at the Reims Management School.

StatutorY auditorS

PricewaterhouseCoopers AuditRepresented by Christian Marcellin, Partner, and his substitute Pierre Coll.

Deloitte & AssociésRepresented by Dominique Descours, Partner, and his substitute, BEAS.


75%of consolidated sales Generated in tHe replacement marKet.

9.5%operatinG marGin Before non-recurrinG items.

buSineSS review and reSultS

— In 2010, Michelin recorded historic results with a 13.4% increase in sales volumes, led by the Group’s global presence and the rebound in mature markets.

net Sales, up 20.8%, amounted to €17.9 billion.

The Group also posted operating income of 1,695 million euros and 9.5% operating margin

And generated positive free cash flow of 426 million euros at a time of sharply rebounding demand, rising raw materials prices, revitalized capital expenditure and prepaid contribution to pension plans.

170 countries

sales and marKetinG operations in

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BuSInESS REvIEW And RESulTS

COntEnts— Financial Results and Structure p. 22— Income Statement – Cash-Flow statement – Balance Sheet p. 26— 2010 Operating highlights p. 29— Passenger car and light truck tires p. 30 — Truck tires p. 31 — Specialty businesses p. 32 — Outlook for 2011 p. 33


Financial reSultS and Structurea new PhaSe oF dYnamic growthFor Michelin, 2010 was a year of strong growth, enhanced manufacturing flexibility and historically high margins. In recent years, Michelin has laid the foundations for a new phase of dynamic growth, built on the dedication and professionalism of our teams, the value of our brands and a clearly strengthened balance sheet.

net SaleSConsolidated net sales amounted to €17,891 million, up 20.8% at current exchange rates compared with 2009.

The increase was led by a 13.4% improvement in sales volumes and a 1.7% gain from the price mix, as higher prices amply offset the impact of an unfavourable product mix throughout the year. The latter reflected the faster growth in original equipment volumes than in the replacement seg-ment. The favorable 2.6% price effect gathered momentum on price increases in every region and the application of contractual clauses indexing prices to raw materials costs.

The 4.8% positive currency effect resulted mainly from increases in the uS dollar, Brazilian real, Canadian dollar and Australian dollar against the euro.

analYSiS oF net SaleSIn € million and percentage of net sales

14,807

17,891+20.8%

2009net sales

2010net sales

volumes+13.4%

Price mix+1.7%

Currency+4.8%

+1,982 +278

+824

22

— 9,790 / +18.2% Passenger car and light truck tires and related distribution

— 5,680 / +26.3% Truck tires and related distribution

— 2,421 / +19.2% Specialty businesses

2010 net SaleS bY buSineSSas a% of the total inside the chart in € millions and as % change outside the chart

55% 13%

32%

2010 net SaleS bY region as a% of the total inside the chart in € millions and as % change outside the chart

— 7,682 / +13.8% Europe

— 6,148 / +23.1% north America and Mexico

— 4,061 / +32.7% Other regions

43% 23%

34%

E17,891 Million

20102009200820072006

16,38416,867

16,408

14,807

17,891

net SaleS in € millions


reSultSOperating income before non-recurring income and expenses amounted to €1,695 million or 9.5% of net sales, compared with €862 million and 5.8% in 2009. There were no non-recurring items recognized for the year. The €833-mil-lion increase in operating income and 3.7-point improvement in operating margin, before non-recurring income and expenses, mainly reflected the favorable impact of higher volumes (€914 mil-lion), the price mix (€278 million, including €391 million from higher prices) and the currency effect (€184 million). higher raw materials prices reduced operating income by €544 million.

net income for the year came to €1,049 million.

E1,695 Million oPerating income(1)

in € millions Operating margin(1) as a % of net sales

(1) Before non-recurring items.

20102009200820072006

1,338

1,645

8.2%

9.8%

5.6% 5.8%

9.5%920

862

1,695

E1,049 Million net incomein € millions

20102009200820072006

573

772

357

104

1,049

analYSiS oF net SaleS In € million and as a percentage of net sales

862

+278

1,695

2009operating income

before non-recurring items

2010operating income

before non-recurring items

Price-mix(o/w price: +€391m)

volumes

External costs*

(o/w raw materials: -€544m)

CurrencyProductivityCost of

driving growth

+914 -536

-162 -155-184

*External costs: raw materials and logistics at constant exchange rates

24

net Financial PoSitionFree cash flow stood at a positive €426 mil-lion for the year, despite a strong rebound in business, higher raw materials costs, an upswing in capital expenditure to €1.1 billion and a prepaid contribution to pension plans totaling €270 million.

Following the success of the €1.2 billion rights issue, gearing declined to 20% at december 31, 2010, while net debt was reduced to €1,629 mil-lion, from €2,931 million at year-end 2009.

E426 MillionFree caSh Flow(2)

in € millions

(2) Cash flows from operating activities less cash flows from investing activities (excluding cash flows from cash management financial assets and borrowing collaterals).

20102009200820072006

(39)

443

(359)

1,507

426

2010 oPerating income(1) bY buSineSSin € millions inside the chartas a % of net sales and change in points outside the chart

— 10.4% / +2.4 Pts Passenger car and light truck tires and related distribution

— 4.4% / +5.9 Pts Truck tires and related distribution

— 17.8% / +4.5 Pts Specialty businesses

(1) Before non-recurring items.

gearing – net debt / equitY ratio

1,014

249

432

86%

70%80% 84%

75%

55% 53%

20%

june 30,2007

Dec. 31,2007

june 30,2008

Dec. 31,2008

june 30,2009

Dec. 31,2009

june 30,2010

Dec. 31,2010


(in € millions except per share data) Year endedDecember 31, 2010

Year endedDecember 31, 2009

net sales 17,891 14,807

Cost of sales (12,403) (10,527)

Gross income 5,488 4,280

Sales and marketing expenses (1,847) (1,650)

Research and development expenses (545) (506)

General and administrative expenses (1,237) (1,113)

Other operating income and expenses (164) (149)

Operating income before non-recurring income and expenses 1,695 862

non-recurring expenses - (412)

Operating income 1,695 450

Cost of net debt (236) (262)

Other financial income and expenses 10 10

Share of profit/(loss) from associates 29 9

Income/(loss) before taxes 1,498 207

Income tax (449) (103)

net income/(loss) 1,049 104

– Attributable to the shareholders of the Company 1,048 106

– Attributable to the non-controlling interests 1 (2)

Earnings per share (in E)

– Basic 6.78 0.69

– diluted 6.64 0.69

conSolidated income Statement 26

(in € millions) Year endedDecember 31, 2010

Year endedDecember 31, 2009

net income 1,049 104Adjustments

– Cost of net debt 236 292– Other financial income and expenses (10) (40)– Income tax 449 103– Amortization, depreciation and impairment of intangible assets and PP&E 965 940– non-recurring income and expenses - 412– Share of loss/(profit) from associates (29) (9)

EBItDA before non-recurring income and expenses 2,660 1,802Other non-cash income and expenses (14) (28)Change in provisions, including employee benefit obligations (423) (372)Cost of net debt and other financial income and expenses paid (177) (207)Income tax paid (297) (19)Change in working capital, net of impairment (427) 947Cash flows from investing activities 1,322 2,123Purchases of intangible assets and PP&E (964) (707)Proceeds from sale of intangible assets and PP&E 61 47Equity investments in consolidated companies, net of cash acquired (4) (1)disposals of equity investments in consolidated companies, net of cash sold - 10Purchases of available-for-sale investments (14) (5)Proceeds from sale of available-for-sale investments 1 29Cash flows from other financial assets (743) (109)Cash flows from investing activities (1,663) (736)Proceeds from issuance of shares 1,204 2dividends paid to the shareholders of the Company (65) (65)Proceeds of the issuance of convertible bonds - -Cash flows from financial liabilities (437) (667)Other cash flows from financing activities (39) (20)Cash flows from financing activities 663 (750)Effect of changes in exchange rates 37 2Increase/(Decrease) of cash and cash equivalent 359 639Cash and cash equivalents as at january 1 1,231 592Cash and cash equivalent as at December 31 1,590 1,231

conSolidated caSh Flow Statement 27michelin - MIChElIn IndIvIduAl ShAREhOldER’S GuIdE - 2011 edition

(in € millions) December 31, 2010 December 31, 2009

Goodwill 416 403Other intangible assets 360 321Property, plant and equipment (PP&E) 7,193 6,782non-current financial assets and other assets 1,108 712Investments in associates and joint ventures 93 71deferred tax assets 828 942non-current assets 9,998 9,231

Inventories 3,770 2,994Trade receivables 2,770 2,314Current financial assets 882 165Other current assets 653 583Cash and cash equivalent 1,590 1,231Current assets 9,665 7,287

tOtAL AssEts 19,663 16,518

Share capital 353 295Share premiums 3,215 1,987Reserves 4,556 3,210non-controlling interests 3 3Equity 8,127 5,495

non-current financial liabilities 3,251 3,568Employee benefit obligations 2,457 2,374Provisions and other non-current liabilities 938 1,105deferred tax liabilities 45 40non-current liabilities 6,691 7,087

Current financial liabilities 896 760Trade payables 1,813 1,249Other current liabilities 2,136 1,927Current liabilities 4,845 3,936

tOtAL EqUItY AnD LIABILItIEs 19,663 16,518

conSolidated balance Sheet 28

2010 oPerating highlightS

Michelin booth at 2010 Paris Auto Show showcased global ad campaign

MIChElIn Alpin 4 takes top score in AdAC test and earns highest 3-star rating

On-road, environmental and technological performance: A winning trio with the new MIChElIn Pilot Sport 3

Sales of MIChElIn X One super singles top one million

distribution: Michelin and Rodi sign partnership agreement in Spain’s Catalonia-Aragon region

Earthmover tires: MIChElIn X-TRACTIOn, a new solution to improve worksite productivity

Michelin Group tops the podium at dakar 2011

E1.2 billion rights issue successfully completed

A full description of 2010 highlights may be found on the Michelin website: www.michelin.com/corporate/finance


— TEChnOlOGY lEAdER

— 31 PlAnTS In 17 COunTRIES

— nO.1 WORldWIdE In FuEl-EFFICIEnT TIRES

hiStoricallY high Financial PerFormance

In all, net sales in the Passenger Car and light Truck Tires and Related distribution segment stood at e9,790 million for the year, up 18.2% on 2009. unit sales were sustained throughout the year by firm demand for winter tires and the strength of the MIChElIn brand. The price mix remained favorable despite the OE/replacement market mix, reflecting price

increases implemented throughout the year to help offset higher raw materials prices and ongoing improvements in the segment/speed rating mix.

The sharp rise in volumes, especially in winter tires, the amply positive price-mix in the face of higher raw materials costs and the improvement in manufacturing costs at a time of high capacity utilization helped to lift operating income before non-recurring income and expenses to €1,014 million or 10.4% of net sales, compared with €661 million and 8.0% in 2009.

PaSSenger car and light trucK tireS & RELAtED DIstRIBUtIOn

nEt sALEs 9,790 8,280

OPERAtInG InCOME 1,014 661 (before non-recurring items)

OPERAtInG MARGIn 10.4% 8.0%(before non-recurring items)

Passenger Car and Light truck operations accounted for 55% of Group net sales.

2009 (in € million)

2010

30

— nO.1 WORldWIdE In ThE ORIGInAl EQuIPMEnT, RETREAd And REPlACEMEnT MARKETS

— 26 PlAnTS In 15 COunTRIES

rebounding PerFormance, led bY volumeS, deSPite higher raw materialS coStS

net sales in the Truck Tires and Related distribution segment amounted to €5,680 million for the year, up 26.3% on 2009. Sales volumes rose sharply against low prior-year comparatives, with faster

growth at the end of the year causing certain sup-ply issues in mature markets. despite an unfavor-able OE/replacement market mix, the price-mix improved quarter after quarter, thanks to the gradual application of price increases to pass on rising raw materials prices.

At a time of sharply rising raw materials costs, operating income before non-recurring income and expenses came to €249 million, thanks to higher volumes, the segment’s improved competi-tiveness and the responsive pricing policy.

trucK tireS& RELAtED DIstRIBUtIOn

nEt sALEs 5,680 4,496

OPERAtInG InCOME 249 (69) (before non-recurring items)

OPERAtInG MARGIn 4.4% (1.5)%(before non-recurring items)

truck operations accounted for 32% of Group net sales.


2010


— GlOBAl MARKET lEAdER In EARThMOvER And AIRCRAFT RAdIAl TIRES

— EuROPEAn MARKET lEAdER In AGRICulTuRAl TIRES— EuROPE’S lEAdInG MOTORCYClE TIRE BRAnd— EuROPEAn MARKET lEAdER In MAPS, GuIdES And TRAvEl

ASSISTAnCE WEBSITES— 16 PlAnTS In 8 COunTRIES

StructurallY high oPerating income

net sales from the Specialty Businesses came to €2,421 million, a gain of 19.2% on 2009. Growth was led by Michelin’s powerful momentum in every tire market, as well as by the application of contractual clauses indexing prices to raw materi-als costs.

Operating margin before non-recurring income and expenses stood at a structurally high 17.8%,

compared with 13.3% in 2009. The improvement was due to i) the increase in tonnages sold in each of the Specialty tire businesses, with a significant contribution from the Earthmover segment and ii) the favourable impact in the second half of the increase in prices indexed to raw materials costs.

SPecialtY buSineSSeS

nEt sALEs 2,421 2,031

OPERAtInG InCOME 432 270 (before non-recurring items)

OPERAtInG MARGIn 17.8% 13.3%(before non-recurring items)

specialty operations account for 13% of Group net sales.


2010

32

Michelin is committed to driving a new phase of faster, more dynamic growth, at a time of steadily increasing global tire demand and rising raw materials prices.

In this environment, Michelin enjoys a number of differentiating competitive strengths, including a powerful brand and the premium pricing power it confers; the technological leadership and balanced performance delivered by its tires, which are aligned with customer expectations; the competitiveness and flexibility of its manufacturing base, which has been considerably enhanced through the commitment of its teams; and a robust balance sheet capable of supporting its growth ambitions and weathering the ups and downs of the business cycle.

Backed by these strengths, and barring any major change in the economic environ-ment, Michelin has set ambitious objectives for 2011.

Michelin aims to drive at least a 6.5% increase in unit sales, in line with the 2011-2015 growth targets.Michelin will maintain a highly responsive pricing policy in the face of rising raw materials costs. Michelin expects to report higher operating income in 2011, despite the cost of stepping up its presence in new markets (around €150 million in temporary outlays for production start-ups, sales and marketing operations and advertising).In light of the increase in raw materials costs and the unprecedented €1.6 billion capital expenditure program, free cash flow is expected to be temporarily negative in 2011.nevertheless, Michelin confirms its objective of generating positive free cash flow over the entire 2011-2015 period.

outlooK For 2011


in cloSe touch with our ShareholderS

— As owners, shareholders have made a commitment to supporting their Company over the long-term, participating in its expansion and sharing the risks while exercising their power of decision. Their confidence is a strength that Michelin carefully nurtures by adhering to strict ethical standards, applying fair corporate governance practices and engaging in high-quality dialogue. By investing in Michelin, shareholders are embracing a project whose success is being driven by technological leadership, powerful brands, expansion in the global marketplace and a commitment to combining performance and responsibility by demonstrating our core values: Respect for Customers, People, Shareholders, the Environment and Facts.

+ 44%Gain in tHe micHelin stocK price Between decemBer 31, 2000 and decemBer 31, 2010

E9.48 Bnin marKet value at decemBer 31, 2010

232,000reGistered sHareHolders

34

In ClOSE TOuCh WITh OuR ShAREhOldERS

COntEnts— Share data and performance p. 36— Capital and ownership structure p. 37— A dedicated team at your service p. 40— Shareholding options p. 42— Owning directly registered shares p. 43

- Account management- Buy and sell orders- Fees

— Estate, transfers and gifting p. 47— Taxation p. 48— Reaching out to our Shareholders p. 50— The Shareholder Information Kit p. 52— The Shareholder Consultative Committee p. 54— Employee Shareholders p. 56— The Annual Shareholders Meeting p. 58— Your rights as a Shareholder p. 60— Financial glossary p. 62— 2011 investor calendar p. 65

35michelin - IndIvIduAl ShAREhOldERS GuIdE - 2011 edition

Share data and PerFormance

Share inFormation

michelin StocK Price, 2006 to 2010 BASE 100 AT dECEMBER 31, 2005

“where can i find past share performance data?”share price history since January 1, 1995 may be downloaded as an excel spreadsheet from http://www.michelin.com/corporate/En/finance/share-debt/historyratios

qUEstIOns/AnsWERs

— ISIn: FR 0000121261 — Par value: e2.00 — Traded in units of: 1 — Stock market: nYsE Euronext Paris – Compartment A — Ticker symbol: ML Eligible for the sRD deferred settlement system Eligible for PEA Equity Savings Plans (French tax residents only)

marKet €9.48 billion caPitaliZation at december 31, 2010

average dailY 1,116,722 in 2010, trading volume for a 187% share turnover

StocK indeX weightingS at december 31, 2011:

The Michelin share represented 1.34% of the CAC 40 index and 0.57% of the Euronext 100 index.

The Michelin share is also included in the main socially responsible investment indices, which are made up solely of companies whose strategies fully integrate sustainable development objectives. These include:

— The dow Jones Sustainability Indices (DjsI) created by dow Jones Indexes, STOXX limited and the Swiss rating agency SAM (Sustainability Asset Management)

> DjsI stOxx for European sustainability leaders> DjsI World for global sustainability leaders

— The Ethibel Sustainability Index (EsI) Europe, managed by the Ethibel rating agency.

— The Advanced Sustainability Performance Index (AsPI) Eurozone, managed by the vigeo rating agency.

0

50

100

150

200

250

0

12

24

36

48

60

Monthly trading volumes

MichelinCAC 40

june 06 june 07 june 09june 08dec. 05 dec. 06 dec. 07 dec. 08 dec. 09 june 10 dec. 10

36

DID YOU knOW?

caPital and ownerShiP Structure

at december 31, 2010

— Share capital: €353,215,690— Shares outstanding: 176,607,845— voting rights outstanding: 226,828,425

number oF ShareholderS at december 31, 2010

Michelin has more than 4,000 institutional shareholders, 70,000 employee shareholders and 159,000 other individual shareholders. The 49,000, or more than 44%, increase in the number of non-employee individual shareholders primarily reflects the results of the September 28, 2010 rights issue.

number of shareholders, 2006 to 2010

2010 2009 2008 2007 2006 232,471 192,486 185,436 154,178 157,445

created in 1863 as a partnership limited by shares, the company changed its name to Michelin et Compagnie in 1889. michelin shares were first listed 57 years later, on August 22, 1946. in 1951, the company changed its name to compagnie Générale des etablissements michelin, which today serves as the parent company of the michelin Group.

— Employees (through the Employee Stock Ownership Plan)

— Individual shareholders — Resident institutional investors — non-resident institutional investors

ownerShiP Structure AT dECEMBER 31, 2010

Shares held in the same name for at least four years carry double voting rights.

— Employees (through the Employee Stock Ownership Plan)

— Individual shareholders — Resident institutional investors — non-resident institutional investors

voting rightS Structure AT dECEMBER 31, 2010

55.2%

29.8%

13.2%

1.8%

54.6%

26.8%

16.1%

2.5%


Share performance, 2006 to 2010

Source : Euronext NYSE.

Share price (in €) 2010 2009 2008 2007 2006

High 64.51 58.67 79.90 106.70 73.30

Low 48.13 22.69 30.65 67.75 43.21

High/low ratio 1.34 2.59 2.61 1.57 1.70

Closing price for the year 53.70 53.58 37.57 78.50 72.50

Change over the year + 0,2% + 42,6% - 52,1% + 8,3% + 52,7%

Change in the CAC 40 index over the year - 3,3% + 22,3% - 42,7% +1,3% + 17,5%

Market capitalization at December 31 (€ billions) 9.48 7.90 5.45 11.30 10.41

Average trading volume for the year 1,116,722 1,138,691 1,740,267 1,217,949 1,191,679

Average shares outstanding 152,902,704 146,184,080 144,495,251 143,770,101 143,390,450

Total shares traded over the year 288,114,287 291,504,866 445,508,266 310,577,078 303,878,126

Share turnover ratio 188% 199% 308% 216% 212%

38

In € per share, except ratios 2010 2009 2008 2007 2006

Dividend per share 1.78(1) 1.00 1.00 1.60 1.45

net assets per share 46.0 37.2 35.2 36.7 32.6

Basic earnings per share 6.78 0.69(4) 2.46 5.32 3.95

Price-earnings ratio 7.9 77.7 15.3 14.8 18.4

Pay-out ratio 30.0% 140.8% 40.7% 30.1% 36.7%

dividend yield(2) 3.3% 1.9% 2.7% 2.0% 2.0%

Per Share data, 2006 to 2010

how are the above ratioS calculated?

(1) Subject to approval at the Annual Shareholders Meeting on May 13, 2011.(2) Based on the closing share price for the year.(3) Pro forma, adjusted to reflect the October 2010 rights issue.(4) 2009 earnings per share have been restated to take into account the impact of the October 2010 rights issue.

net assets per share net assets/shares outstanding at december 31

Basic earnings per share net income/shares outstanding at december 31

Price-earnings ratio Share price at december 31/basic earnings per share

Pay-out ratio dividend/basic earnings per share

Dividend yield dividend/closing share price for the year


a dedicated team at Your Service— Michelin shares are always held in registered form, reflecting our dedication to understanding your needs and to fostering a personalized relationship with you throughout the year.

We are fully committed to supporting you in every aspect of the share ownership process and to answering all of your questions as quickly as possible.Whether you’re interested in our business operations, strategy or results, or wondering how to manage your shares, calculate their cost price or organize your share gifting, we are there to help you to find the right solution and get the right answer to your questions.

JacqueS engaSSer, Shareholder relationS Manager

Every day, we do our best to meet the needs of our shareholders. All our teams are available when you need them, to answer your questions quickly and effectively and to make your shareholder experience as rewarding as possible.

“

“

to contact us:

toll free number (France only):

Phone: +33 (0) 4 73 98 59 00

Fax: +33 (0) 4 73 98 59 04

Postal address: Compagnie Générale des Établissements Michelin 12, cours Sablon - 63040 Clermont-Ferrand Cedex 9 – France

E-mail: [email protected]

40

ShareholderS regiStered directlY in the comPanY regiStrY maY alSo call uPon the ServiceS oF:

the Share ServiceS team“We open shareholder accounts and execute buy and sell orders, while fostering close relationships with our directly registered shareholders.”

nancy AdAM and nicole AlMOdOvAR

the eState, tranSFer and giFting team “We quickly deal with estate, transfer and gifting issues involving directly registered shares, in liaison with shareholders, notaires or heirs.”

Monique BRuYAS and Josette lARBRE

emPloYee ShareholderS maY contact:

the emPloYee Shareholder relationS team“We answer questions from employee shareholders and help them in carrying out all of their administrative formalities, acting as an interface with the custodian banks.”

Corinne CAZABOnnE and the network of country BIB’Action correspondents

“i need some information about my shares. how and when may i get in touch with you?”

You can contact us:— by phone from Monday to Friday, 9 a.m. to 6 p.m.— by e-mail, fax or letter, at any time.

We are committed to replying to every request within 24 hours.

note as well that all of our corporate information may be found on the website, at www.michelin.com/shareholdersWe look forward to your visit!

“i need to know the closing share price after your office hours. what should i do?”

If you live in France, you can call the 0800 000 222 toll-free number after 6 p.m. and get a message, recorded after close of trading, providing a wide variety of price and trading information (in French only):

— opening price, — high for the day,— low for the day,— closing price,— percentage change from the previous closing price,— trading volume,— closing CAC 40 index and percentage change since the previous closing.

qUEstIOns/AnsWERs

41michelin - IndIvIduAl ShAREhOldERS GuIdE - 2011 edition

Shareholding oPtionS— According to Company by-laws, all Michelin shares must be held in a registered share account.

When the account is held and administered by the issuing Company, the shares are said to be directly registered. Any French shareholder, regardless of how many shares he or she owns, may register the shares directly with the Company.

beneFitS oF direct regiStration (in Practice reStricted to French reSidentS):

directly registered shareholders enjoy a number of service and fee benefits.

directly registered shareholders also pay lower fees on Michelin stock trading orders.

Difference between direct registration and indirect registration

Michelin shares may be registered directly with Michelin and/or indirectly with your bank or broker.

nB: non-French tax residents

non-French tax residents should note that the above services for directly registered shareholders are governed by French law, particularly as concerns taxation. Please contact us to find out more about the possibilities offered to non-resident investors.

ADDED sERvICEs WAIvED FEEs

We offer:

• direct, personalized contact,

• direct execution of buy and sell orders,

• calculation of the average cost price of your shares,

• payment of dividends directly to your account, without any fees.

Directly registered shareholders do not pay any:

• custody and management fees,

• transfer fees under gifting or estate arrangements,

• fees related to corporate actions, such as bonus share or rights issues.

You own registered shares

DIRECtLY InDIRECtLY

Custodian Compagnie Générale des Établissements Michelin – CGEM

Your bank or broker

Management fees

none Invoiced by your bank or broker

Dividends Paid immediately into your account

Paid by your bank or broker

Information sent directly to all registered shareholders

shareholders Meetings

notice of Meeting and admission card sent directly to all registered shareholders

Buy and sell orders

Possible by phone, fax or post. Executed immediately by Michelin

Orders are executed by your bank or broker, according to their procedure

42

owning directlY regiStered ShareS

account management opening an account

To open an account in the Company’s share reg-istry, you need to sign the share account applica-tion (convention d’ouverture de compte de titres), either:

- before transmitting your first buy order to the Shareholder Relations department; or

- after transferring your indirectly registered shares previously held by a bank or broker.

The share account may be individual, joint-tenant, tenancy-in-common or held under a usufruct or bare ownership arrangement.

account statements

In addition to regulatory tax information and/or forms, account holders or managers receive:

- a statement of holdings after every transaction ;

- at the beginning of each year, an account state-ment as of the previous december 31, along with the prices to be used in filing a French wealth tax (ISF) return.

michelin stock trades

Subject to the conditions and limitations described below, the Shareholder Relations department transmits your Michelin buy and sell orders to the authorized bank or broker.

You will receive a trade advice confirming that the order has been executed.

other account transactions

You will be notified personally of any other trans-actions concerning your Michelin share account. Any related buy or sell orders are executed and the shares recorded in your account as quickly as possible and free of charge.

annual tax package

In February, we will send you a statement of reportable tax information to be included with your tax return for the prior-year. In particular, it shows the amount of proceeds from stock sales during the year.

To comply with French anti-money laundering legislation, shareholders must provide the following documents prior to executing their first trade:- a photocopy of both sides of a valid photo identity, such as a passport or national identity card ;- a photocopy of proof of address in France, such as an electricity or landline phone bill ;- bank account details for wire transfers and direct debits (in the case of tenancy-in-common estate accounts, only the representative of the undivided estate needs to submit bank details). In the case of joint accounts, each tenant must submit all of these documents.

French law ProhibitS uS From Placing a buY or Sell order unleSS we are in PoSSeSSion oF theSe documentS.


buY and Sell orderS through the Share ServiceS team

acceptable orders

Please submit only firm buy and sale orders. short-sell orders (i.e. selling immediately stocks purchased under the deferred settlement system) will not be accepted.

You need to fill out a French buy or sell order

To be valid, a French trade order must clearly indi-cate, in French:

- your name and full postal address;- your shareholder account number, if you already

own Michelin shares,- whether the trade is to buy or sell,- The number of shares to be purchased or sold,- the buy or sell price, according to the type of

order described below,- how long the order remains in effect.

limit Price orderS: specify the maximum purchase price (buy limit) or minimum selling price (sell limit). This is the most commonly used order. They allow you to set the desired price but they may be only par-tially filled or take some time to be completed, depending on your price and which way the share price is moving.

When several partial transactions are required to fill the order, brokerage fees are charged for each one.

Pros: w you control the price and are protected against downside fluctuations.

Cons: w there is no guarantee when or if the order will be fully executed.

types of order

marKet orderS, which do not indicate anY Price: are filled immediately, ahead of limit or peg orders. You can be sure that all of the order will be executed, but not necessarily at the same price. The price shown on the trade advice is the average price and a single brokerage fee is charged.

Pros: w orders are filled quickly and completely.

Cons: w there is no control over price.

For eXamPle:

You want to buy 100 shares for a maximum of e55 each. You place a buy limit order at e55 or better. Your order is executed, in full if there are 100 shares for sale at that price, or partially at e55 and partially for less, or it remains partly outstanding if the share price has risen.You want to sell 100 shares for at least e60 each. You place a sell limit order at e60 or better. Your order is executed, in full if there is enough demand for 100 shares at that price, or partially at e60 and partially for more, or else it remains partly outstanding if the share price has fallen.

For eXamPle:

You absolutely want to sell 100 shares, regardless of the price. You place a sell market order for 100 shares. At the same time, two buy orders are available, one for 40 shares at e60 and the other for 150 shares at e58. In this case, 40 of your shares will be sold at e60 and 60 shares at e58.

44

Peg orderS: are limit orders to buy or sell a given number of shares at a price set to track the current bid or ask of the Euronext central order book. In other words, the price will be the opening price if the order is placed at start of trading or the best bid or ask price over the trading day. They are not priority orders, so they may be gradually filled in several trades.

Pros: w the trade is executed at the best price available when placed.

Cons: w there is no guarantee when or if the order will be fully executed.

Placing orders through the Share Services team

Buy or sale orders received by the Share Services Team before 5:15 pm CEt are placed the same day. Orders may be submitted by:

- Postal mail to 12, cours Sablon, 63040 Clermont-Ferrand Cedex 9, France

- Fax to +33 (0)4 73 98 59 04

- Phone to (toll-free, France only) or +33 (0)4 73 98 59 00, if calling from outside France.

- E-mail to [email protected]

Barring any instructions to the contrary, orders received after 5:15 pm CET and not executed before close of trading that day are carried over and placed the next trading day.

the shareholder Relations Department acts as the sole interface with the bank or broker executing your trade.

Joint accounts (tenancy-in-common, undivided estate, joint tenancy)

unless proxy has been expressly given to one of the joint tenants, buy and sell orders concern-ing joint accounts must be placed in writing and signed by all of the tenants.

large trades

Orders of e15,000 or more must be placed in writ-ing with the Shareholder Relations department. note that prior to executing a buy order of this amount, the bank or broker has the right to require that enough cash has been deposited in your account to cover the purchase.

Payment

The net amount shown on the trade advice is paid:

- by check or wire transfer to the bank or broker, in the case of buy orders,

- by wire transfer to your account by the bank or broker, in the case of a sell order.

For eXamPle:

You place a peg buy order for 100 shares. At that time, the best ask is for 80 shares at e57. In this case, 80 shares will be purchased at e57 with the rest of the order postponed or transformed into a limit buy order for 20 shares at e57 or better.

neweffective september 1, 2011, you will be able to trade your Michelin shares online.


FeeS brokerage fees

For directly registered shares, brokerage fees amount to 0.30% of the gross transaction amount, excluding vAT, with a minimum charge of e6.00.

no custody fees

We do not charge any custody and account admin-istration fees, including in the event of gifting, transfers or estate settlements.

“how do i transfer my shares to a directly registered account?”If you reside in France, to transfer your shares registered with your bank or broker to an account directly registered with Michelin, fill in the demande de transfer (share transfer form) and send it to your French bank or broker.

As soon as your shares are transferred, we will send you a notice of direct registration and a convention de compte (share account application).

The share transfer form and the share account application are available on request or downloadable from www.michelin.com/actionnaires , in the “Nominatif Pur” section on the “Être Actionnaire” page. These documents are not available or valid in English.

“why can’t i transfer my shares from my Pea equity savings plan to a directly registered account?”If you are a French tax resident, you may invest in Michelin shares as part of your tax-advantaged PEA equity savings plan. however, Michelin is not authorized to manage PEA accounts, which under French legislation must be linked to a checking account. As a result, only a bank is authorized to open a PEA account, buy and sell shares in and out of the account and pay dividends into it.

In this case, it is better to retain your Michelin shares in indirect registered form.

qUEstIOns/AnsWERs46

giFting Your ShareS in France via donation Partage or don manuel?

donation-partage

Similar to gifts inter vivos in the uK, donation-part-age is a deed by which you gift all or part of your shares to your children and other heirs while you are still alive. The shares must be accepted by the giftees, who become the de facto owners, there-

eState, tranSFerS and giFting— For holders of directly registered shares:

The Shareholder Relations department is committed to assisting you in transferring your Michelin shares for estate settlement or gifting purposes. For other estate or gifting matters, you should contact your notaire (in France), estate lawyer or estate planning advisor, who will have a broader understanding of your personal asset situation.

by removing the shares from your estate and, in general, maintaining their value at the time of gift rather than death. A donation-partage is irrevo-cable and the deed must be signed before a notaire. You should send us a copy of the deed so that we change the owners’ names in the Share Registry.

don manuel

A don manuel is when you give your shares “hand-to-hand,” i.e. outright. In general, shares given as a don manuel are returned to the estate to be revalued before the estate is divided. A don manuel does not have to be recorded by deed in front of a notaire, but it should be declared to the French tax authorities by filing a 2735 tax form within a month of the date of gift. You should send us a copy of the 2735 form or the gift letter (with a certified true signature) so that we change the owners’ names in the Share Registry.

gift tax allowances in France, as of January 1, 2011

In France, most estate tax allowances are also applicable, in the same conditions, to gift taxes, except that any conditions incumbent on the deceased must be fulfilled by the gifter and any incumbent on the heirs and beneficiaries by the giftees. The gift may be conveyed in one or several

times, up to the allowance, every six years; i.e. after six years, you may give the same amount again without being liable to the gift tax.

Each parent may give up to e159,325 per child (i.e. e318,650 for a couple), without being liable to the gift tax.

Grandparents can give up to e31,865 to their grandchildren, without being liable to the gift tax.

An individual may give e80,724 per spouse or civil-union (PACS) partner, e15,932 to each broth-er or sister, e7,967 to each nephew or niece and e5,310 to each great-grandchild.

inheritance (For French reSidentS)

To enable us to deal with estate matters quickly and efficiently, please notify us of the date of death, the name and address of the deceased and the address of the notaire who is handling the estate. We will forward all of the information he or she needs to file the estate papers.

Michelin will then scrupulously follow the notaire’s instructions concerning division of the shares.


dividend taX in FranceShareholders who are French tax residents may choose to pay their dividend tax in one of two ways:

reporting dividends as taxable income

Stock dividends are subject to income tax as saving and investment income.

tax relief

• 40% allowance

In calculating your tax liability, a 40% allowance (abattement) is first

applied to any dividend income received from companies headquartered in the European union or in a country hav-ing signed a tax treaty with France to avoid double taxation. The amount of this reduction is uncapped.

• additional annual allowance

After applying the 40% allowance, dividend income may be reduced by an additional allowance of e1,525 per year for a single, widowed or divorced person or for a married couple who have elected to be taxed separately or e3,050 for a married couple or civil partners who have elected to file a joint tax return.

Paying a 19% flat-rate withholding tax (prélèvement forfaitaire libératoire)

Opting to pay the 19% flat-rate means forfeiting the standard abattement deductions, even on any dividends that you elect to report as taxable income. Should you choose this option, which is all-or-nothing and irrevocable, please notify us before the dividend payment date.

Prélèvements sociaux withholding taxes

Regardless of how you decide to pay your dividend tax, your gross dividend income, before abattements, is subject to prélèvements sociaux withholding taxes, which total an aggregate 12.3% as of 2011. These taxes include the CSG (8.2%), the CRdS (0.5%) and the social secu-rity financing tax (3.6%; i.e. the original 2.5% plus a 1.1% sur-tax to finance the RSA guaranteed minimum income system).

These social surtaxes are withheld at source if the paying agent is based in France.

taXation — the following information concerns shareholders who are tax residents of France. this information is not applicable to other countries, each of which has its own tax rules.

nOtE: Being qualified as a French tax resident requires more than just an address in France. You are generally considered to be a French tax resident if you fulfill one of the following four conditions:

- You have your household in France. - France is your primary place of

residence (more than 183 days a year).

- You work in France.- You have most of your assets

in France.

these conditions should be interpreted in the light of international agreements governing double taxation.

If your shares are directly registered, in March of each year, we will send you the imprimé fiscal unique (IFu) reportable tax form, which shows your dividend income and any proceeds from share sales during the prior year. Compagnie Générale des Etablissements Michelin is subject to the same rules of disclosure to French tax authorities as banks and brokers.

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caPital gainS taX in FranceThe net capital gain is the difference between the selling price (excluding transaction fees and taxes) of a share and its purchase cost (including purchase fees).

the annual proceeds exclusion from capital gains tax has been eliminated

Effective January 1, 2011, all capital gains on the sale of securities in France are subject to income tax and prélèvements sociaux withholding tax, regardless of the amount of proceeds.

Transitional measures are in place to allow shareholders to claim capital losses suffered in 2010 if their total proceeds did not exceed the previous exclusion.

tax rate

The tax rate has been raised to 19% from 18% and the aggregate prélèvements sociaux rate has been increased to 12.3%, for a total capital gains tax of 31.3%.

calculating Your Share value For the French iSF wealth taX

If you are subject to the French wealth tax (ISF), your listed securities should be valued at the last known market price or the average price over the 30 trading days preceding January 1 of each year.

the SPeciFic caSe oF Pea equitY SavingS PlanS

Compagnie Générale des Établissements Michelin is not authorized to manage PEA accounts.

(See the FAQs on page 46)

In 2010, the figures for the Michelin share

Closing price: e53.70 Average price: e54.368


reaching out to our French individual ShareholderS

Marseilles

Nice

Clermont-Ferrand

Lyons

Annecy

Paris

Strasbourg

Lille

Nantes

Rennes

Bordeaux

Orléans

La Rochelle

BiarritzPerpignan

Toulouse

ReimsMetz

Grenoble

Dijon

Tours

Nancy

Amiens

Rouen

Caen

Montpellier

2004 to 2008

2009

2010

2011

Annual ShareholdersMeeting

michelin reaches out to shareholders throughout france

Marseilles

Nice

Clermont-Ferrand

Lyons

Annecy

Paris

Strasbourg

Lille

Nantes

Rennes

Bordeaux

Orléans

La Rochelle

BiarritzPerpignan

Toulouse

ReimsMetz

Grenoble

Dijon

Tours

Nancy

Amiens

Rouen

Caen

Montpellier

2004 to 2008

2009

2010

2011

Annual ShareholdersMeeting

meetings with shareholders

In recent years, Michelin has actively reached out to individual shareholders in France by organizing information meetings in the country’s leading cities.

the annual meeting in Paris, which is led by the Managing Partners, is generally held in the autumn. In 2010, it took place on november 19, during the Actionaria investor fair. Outside Paris, the meetings are led by Jacques Engasser, Shareholder Relations Manager, or by valérie Magloire, Investor Relations Officer. Organized locally, these events offer an invaluable opportunity to discuss important issues with our French shareholders and to get to know them better.

They allow us to present your company, its business operations and results, explain its strategy in greater detail, and answer your questions.

In 2010, we went to Perpignan, Bordeaux, Reims, nice, nantes and Strasbourg, while in 2011, meetings will be organized in six new cities: Marseilles, Toulouse, lille, Metz, Annecy and Rennes, as well as Paris. In this way, we will continue to diversify the venues from one year to the next, so as to cover the entire country and stay in touch with all of our shareholders in France.

At the same time, 292 meetings were organized in 17 countries with 797 analysts and institutional investors in 2010.

50

If you are a loyal shareholder and would like to participate in the next guided tour, which will take place on Friday afternoon, May 13, 2011, after the Annual shareholders Meeting, please call us at +33 (0)4 73 98 59 00 to pre-register.

Space is limited, so only the first 60 shareholders who contact us by May 3, 2011 will be selected for the tour.

the ladoux technology center guided tour, may 7, 2010

A guided tour of our ladoux Technology Center was organized for a small group of shareholders, invited on the basis of criteria that change every year. Participants dis-covered the diversity of skills and capabilities deployed in our Research, development and Process Engineering activities, thanks to a presentation by the Center’s Managing director, followed by rolling resistance demonstrations and test rides with professional drivers on wet pavement and in other conditions.Shareholders enjoyed the total immersion in the heart of Michelin’s business, while the Shareholder Relations Team appreciated the opportunity to interact extensively with shareholders.

Salon actionaria investor fair november 19-20, 2010 Palais des congrès in Paris

As in 2009, Michelin participated in the Actionaria inves-tor fair held in Paris at the Palais de Congrès convention center on november 19 and 20, 2010. The event gave us an opportunity to talk and strengthen our ties with the many shareholders who visited our booth and to present your company to potential investors.

during the two days, the Shareholders Relations and Consumer Services teams were able to answer a wide variety of questions and queries.

Michelin will also attend the next edition of the fair, to be held on november 18 and 19, 2011.

We are looking forward to seeing you there!


the Shareholder inFormation Kit — Michelin regularly and transparently provides shareholders with the clear, comprehensive information they expect, in both paper and electronic formats.

These documents may be downloaded from the Shareholders’ Corner on the www.michelin.com/shareholders website.

Shareholder documentS

the individual Shareholder’s guide

The Shareholder’s Guide, which you are now reading, has been designed with you in mind. It includes a review of your Company’s 2010 perfor-mance and outlook for the future (Part 1 – Interview with Michel

Rollier, Managing Partner), a presentation of the Group (Part 2 – Michelin at a Glance), the consolidated financial highlights for 2010 (Part 3 – Business Review and Results) and practical infor-mation to make your investment easier to manage (Part 4 – In Close touch With Our shareholders).

The Guide has also been enriched with interac-tive features in its online version, available in the Shareholder’s Guide section of the www.michelin.com/shareholders website.

the Horizons shareholder newsletter

Known as Horizons, the letter to Shareholders keeps you up-to-date with the latest Group news and emerging trends. Each issue reviews important Group events and high-lights, offering insight into our stra-tegic vision, while presenting new product launches, business develop-ments and share performance.

the shareholder kit on CD-ROM

Shareholder Kit documents are also available on a Cd-ROM on request from the Shareholder Relations department.

HorizonsMICHELIN’S LETTER TO ITS SHAREHOLDERS

ISSUE No 05MARCH 2011

TOPICAL REVIEW2011 - 2015:A New Phaseof Dynamic GrowthPages 4/5

The 2010InternationalBIB FORUMPage 3

The global adcampaign goesto the showPage 6

The Michelin Shareholders’Consultative Committee islooking for new membersPage 8

SEEN FROM WITHIN IN THE NEWS IN CLOSE TOUCH WITH YOU

EDITORIAL

Ladies and Gentlemen,Dear Shareholders,

2010 was an excellent year,when Michelin reported historically

high margins thanks to both the dedicated efforts of all our teams,who successfully captured the recovery in tire demand, and theimprovements in competitiveness and efficiency delivered by ourHorizon 2010 plan. Michelin has emerged from the recession strongerthan ever and is ready to embark on a new phase of dynamic growth.

The growth in the global tire market and the transportationindustry’s ongoing response to the challenges of sustainabledevelopment present historic opportunities for your company’s future.

Geographically, we have begun to re-align the business base with theshift in demand, through a vast capital expenditure program in fastgrowing countries. Technologically, we have proactively responded tochanging demand by bringing to market tires that take less and lessraw material to make, while still offering greater safety, longer treadlife and better fuel efficiency.

Our strategy for the next five years is ambitious and hinges onthree main objectives: to drive strong, diversified growth, to becomemore competitive and to maintain our business performance.

To succeed, we can leverage main competitive advantages,including our ability to satisfy the real needs of our customers throughinnovation, the Michelin brand and its capital of trust, as well as ourother brands and the portfolio of services that we plan to enhanceand diversify. Lastly, there’s the professionalism and dedication of ouremployees, who have enabled Michelin to grow and become a leader.

I am confident that we will succeed.

Michel Rollier,Managing Partner

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the annual and Sustainable development report

Published once a year, the Annual and Sustainable development Report reviews Group strategy, oper-ating highlights and financial results for the year, and presents our sustainable development objec-tives, action programs and achievements.

the registration document

Published once a year, the registration document contains all of the financial and legal disclosures required by French legislation and Autorité des Marchés Financiers (AMF) to enable investors to analyze our strategy and results for the previous year.

Michelin also publishes all of the periodic and annual regulated information required of a listed company in Bulletin des annonces légales obligatoires (BALO), the French journal of Record.

2010 ANNUALAND SUSTAINABLE DEVELOPMENT REPORTMICHELIN PERFORMANCE AND RESPONSIBILITY

A NEW PHASE OF DYNAMIC GROWTH

the ShareholderS’ corner on the www.michelin.com/shareholders website

The specially designed Shareholders’ Corner page on the corporate website was entirely revamped and restyled in 2010. The home page offers quick-click access to the information you need, with easy browsing among the different sections.

In particular, you will find:

- The Finance toolbox, with our contact details, financial calendar, easy access to all your documents and the possibility of signing up for e-mail alerts.

- Clear tax information for French residents, con-cerning dividends, vAT, capital gains, PEA equity savings plans and the ISF wealth tax.

- All of the shareholder documents in electronic file formats, easily downloadable from the Shareholders’ Kit.

- A video of the entire Annual shareholders Meeting, together with a summary of the pre-sentations.

“i would like to know the different release dates for group results. how can i find that information quickly?”The financial calendar is easily accessible from the Shareholders’ Corner home page, on www.michelin.com/shareholders. It shows, in chronological order, all of the dates for the release of our quarterly, interim and annual results. It also lists the dates for the meetings with shareholders in various French cities, the Annual Shareholders Meeting, dividend payment and the release of tire market data.

qUEstIOns/AnsWERs


the SharehoLDer conSULtatIVe commIttee — Comprising shareholders from various backgrounds, the active and enterprising Shareholder Consultative Committee plays an important role in helping us to improve our shareholder relations process. Each member contributes his or her vision of the various issues on the agenda. After sharing ideas, the Committee recommends practical measures to improve shareholder documents so that they address your expectations and concerns more effectively.

members of the Shareholder consultative committee in 2010 (from left to right)

Jacques ENGASSER, Shareholder Relations ManagerSusan SIMMONS, 44, Clermont-Ferrand – employee memberGilles CHAMBON, 66, RoyanThierry LEBRUN, 69, AntibesMichel DELERUE, 71, St-Germain-de-BelvèsDaniel BLANC, 38, Salon-de-ProvenceCaroline MEIGNEN, 49, RullyPatrick DRIZARD, 55, ParisAnne Valérie DUMONT, 44, ParisBernard LARGILLIER, 60, MarseillePascal SURZUR, 49, QuimperJacques BEGON, 67, Tence

Not pictured:

Éric DUBOIS, 38, St-Germain-en-LayeJacques MARTIN, 56, VillefontaineJana POPA, 57, Zalau (Rumania) – employee member

54

how the Shareholder consultative committee works

Chaired by a Michelin Managing Partner, the Shareholder Consultative Committee comprises 14 sitting members, of whom at least 12 are not employees of the Group. Each member must be a Michelin shareholder and remain so throughout his or her term of office; each one agrees to attend Committee meetings.

Members serve for four-year terms that begin on the day of the Annual Shareholders Meeting following the date when new members were des-ignated. new members are designated every year, depending on the number of terms expiring.

Any shareholder may ask to serve on the Committee, simply by responding to the call for candidates published in the letter to Shareholders, on the www.michelin.com/shareholders website and/or the business and financial press. Candidacies may be submitted by letter, fax or e-mail. Members are designated by a Managing Partner, based on the short-list of candidates whose backgrounds meet a certain number of criteria to ensure their representativeness. All designation decisions are final.

role and responsibilities

Through its input and recommendations, the Shareholder Consultative Committee helps to improve the quality of our financial and/or image communication with individual shareholders.

The Committee may issue recommendations in the following areas:

- Committee meeting agendas.

- Preparation of shareholder documents.

- Preparations to organize and hold Shareholder Meetings.

- Meetings with shareholders in France and/or other countries.

- Company-led discussions on how to communicate with shareholders.

- Possible research on what Michelin can do to respond more effectively to shareholder expec-tations.

issues discussed at recent meetings

For the past several years, the Committee has primarily worked on ways to improve our shareholder communication media, such as the Letter to Shareholders, the Shareholders’ Corner on the website, the Shareholder’s Guide, and the Michelin presentation to meetings with shareholders outside Paris. In 2010, however, the meetings focused on the Committee’s evolving role and responsibilities, with the goal of enabling it to act as an effective interface between Michelin and its shareholders. In this way, it can express your expectations and concerns, giving us a clearer idea of how you feel about the shareholder relationship.


emPloYee ShareholderS — Following the three Employee Shareholder Plans in 2002, 2003 and 2008, 70,000 employees and former employees in 67 countries and five continents are now shareholders.

an efficient, structured organization

The employee shareholder relations organization is built on a network of correspondents appointed in the Personnel department in every country.

The correspondents ensure compliance with local legislation and oversees relations with local employee shareholders, including account management and communication.

The 12 versions of the letter to Shareholders may be found in the letter to Shareholders section of the www.michelin.com/shareholders website.

imPortant: uPdating Your PerSonal inFormationIf you change address, you should inform your country BIB’Action correspondent or the custodian bank that administers Michelin shares acquired under the 2002, 2003 and/or 2008 BIB’Action employee shareholder plans.The easiest, fastest and most secure way to do this is via the Internet. Just go to the Personal Information section of the www.nominet.socgen.com website.

You can also update your details by:- Fax at +33 (0)2 51 85 62 15- Phone at +33 (0)2 51 85 67 89- Postal mail to:

SOCIÉTÉ GÉNÉRALE Securities ServicesSGSS/GIS/BOC/STP32, rue du Champ de TirBP 81236 - 44312 NANTES Cedex 3

Note:- The custodian bank for employee

shareholders domiciled in the United States of America and Canada is SGVESTIA.

- The custodian bank for employee shareholders domiciled in the United Kingdom is EQUINITI.

nB: Sending your new mailing address to the Michelin Personnel department does not suffice as this information is not forwarded to the custodians (Société Générale, SGvestia, EQuInITI) or CGEM. To keep your share account information up-to-date with your latest home or mailing address, you must inform the custodian or your country BIB’Action correspondent.

Horizonsจดหมายขาวสำหรับผูถือหุนมิชลิน

ฉบับที่ 04

มิถุนายน 2553

บทบรรณาธิการ

เรียน ทานผูถือหุนทุกทาน

เมื่อปที่ผานมาเปนปที่เศรษฐกิจถดถอยอยางเปน ประวัติการณ แตกลุมบริษัทของเราสามารถรับมือ และปรับตัวไดเปนอยางดีเยี่ยม ผมขอถือโอกาสเรียน ใหทราบถึงวิสัยทัศนในระยะยาวของบริษัทฯดังน้ี

ประการแรกธุรกิจของเราเกี่ยวของกับตลาดที่มีการเติบโตอยางมาก กลาวคือ เราคาดวาจำนวนยานยนตจะเพิ่มขึ้นสองเทาจากนี้ไปจนถึงป 2573

ประการที่สอง จุดศูนยกลางของการขยายตัวของการขนสงทางถนนไดเคลื่อนเขามาสู ทวีปเอเซียและทวีปอเมริกาใต ตลาดเหลานี้มีอัตราการเติบโตอยางมาก และยานยนต หมายถึงความสามารถในการเขาถึงการสัญจรทางบก และการขนสงทางบกเปนตัวจักร สำคัญสำหรับการขยายตัวทางเศรษฐกิจ ลูกคาของเราในประเทศเหลาน้ี มีความตองการ เกี่ยวกับยางรถของเขาในระดับเดียวกับลูกคาของเราในประเทศที่พัฒนาแลว ดังนั้น โครงการที่มีเปาหมายที่ชัดเจนจึงทำใหมิชลินสามารถยืนหยัดอยูในตลาดเหลานี้ได

ในประเทศยุโรปตะวันตก และ อเมริกาเหนือ การขยายตัวจะมีนอยมาก แตลูกคาของเรา ยังคงใหความสำคัญกับผลิตภัณฑประสิทธิภาพสูง การบริการ และการมีสวนรวม ในการรักษาสภาพแวดลอม

ดังนั้น วิวัฒนาการของกระบวนการขนสง เชน ขอจำกัดจากสภาพแวดลอม และจากกฎระเบียบตาง ๆ เปดโอกาสใหเราแสดงใหเห็นอยางชัดเจนมากกวาถึงความ เปนผูนำดานเทคโนโลยีของเรา

สุดทาย เรายังคงทำใหทั่วโลกทราบวา ยางรถของเรามีอายุใชงานที่ยาวนานกวา มีความ ปลอดภัยสูง และประหยัดน้ำมันอันเปนผลใหการปลอยกาซคารบอนไดออกไซดลดลง

เรายังคงความเปนผูนำทางดานการสรางสรรคเทคโนโลยี่ใหมๆอันล้ำหนา ซึ่งยังไมมีใครเทียบเคียงได

ทานสุภาพสตรีทานสุภาพบุรุษและทานผูถือหุนท้ังหลาย เรามีความม่ันใจในอนาคตระยะยาว เนื่องจากบริษัทของเราไดแสดงใหเห็นแลวถึงขีดความสามารถในการปรับตัวและพลังความมุงมั่นที่ชัดเจน

มิเชล โรลิเยร

Managing Partners

รวมมือกับผูถือหุนอยางใกลชิด

การเชิญประชุม

ผานทางเวบไซต

หนา 8

กิจกรรมภายใน

ขยายฐานในตลาด

ที่กำลังขยายตัว

หนา 3

แวดวงขาว

ติดตามการประชุมใหญ

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内部观察

在全球最大的市场中成长

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新闻报道

年度股东大会相关报道

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与你保持紧密联系

电子通告(e-notice)

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地平线(Horizons)米其林股东通讯

篇首语

女士们先生们，尊敬的股东们，

2009年，在历史罕见的低迷市场中，米其林

集团显示了出色的适应能力。我希望为各位

提供我们对未来的长远观点。

首先，我想要指出的是，米其林业务所处的市场有着健康增长的前景：到

2030年，预计全球车辆总数将翻倍。

其次，我认为道路交通的增长动能已经转移到了亚洲和南美洲。由于汽车是

道路移动性的主要工具，而道路交通是经济发展中的重要因素，这些市场均

实现了强劲有力的增长。与成熟市场中的用户一样，这些国家中的最终用户

对轮胎产品的要求非常严格。通过极有针对性的产能扩建项目，米其林将在

这些国家建立起强有力的业务根基。

在西欧和北美市场，销量的增长将会疲软。但我们的客户希望获得更多更好

的服务和产品性能，并越来越关注环保特性。

因此，道路交通的未来变化以及更多的法律及环保限制将为米其林带来更多

机会，强化我们的技术领先优势。

在全球范围内，我们将继续宣传产品卓越的使用寿命及其安全性能，并提高

人们对于米其林产品的燃油效率和更低排放的环保性能的认知。

米其林的领先地位源自我们的创新能力及无可匹敌的技术优势。

因此，女士们先生们，尊敬的股东们，我们对公司的长期发展前景充满了信

心——尤其是在米其林展示了其灵活性与优势的情况下。

贺立业(Michel Rollier)

集团管理合伙人

话题回顾

轮胎定级

轮胎市场的真正

革命

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2010年6月第四期

Employee shareholders who would like more information about their investment are encouraged to contact their correspondent or local Personnel Department.

the list of BIB’Action correspondents may be found in the employee shareholder sec-tion of the www.michelin.com/shareholders website.

employee shareholder information in your own language

The letter to Shareholders is published in 12 languages so that every employee shareholder can take in the latest corporate news in his or her own language. Many country organizations also post comprehensive employee shareholder information on their intranets.

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For all employee shareholders, other than those domiciled in the United kingdom, the United states of America and Canada.

“how can i connect to Société générale’s nominet website if i’ve lost my log-in and password?”On the www.nominet.socgen.com site, click the “I have lost my identification numbers” link. Fill in your name and mailing address and within a week you should receive a new log-in and password from the bank.

“the five-year lock-up on my shares has been lifted and i’d like to sell them. how do i do that?”We recommend you sell them online by logging onto www.nominet.socgen.com with your log-in and password. Go to the “transaction” section, then click on “place a sell order”. Enter the number of shares you wish to sell and click OK. You can also fill in the downloadable sell order from the “Employee Shareholder” pages of the Michelin France intranet and send it back signed to Société Générale by fax or postal mail.

“what if i want to sell my shares before the five-year lock-up ends?”Conditions for early sale vary by country. We highly recommend that employee shareholders living outside France contact their BIB’Action correspondent. For French residents, cases for lifting the five-year ban may be found in the summary table in the “Employee Shareholder” pages of the Michelin France intranet.

“i’m going to retire soon. do i have to sell my shares?”no, you can keep them as long as you like. however, if you wish to sell the shares acquired under the 2008 plan before their lock-up ends in July 2013, and you live in France, you may do so by sending Société Générale a “certificat de travail”, or a statement from the Michelin Personnel department certifying the date of termination of your work contract, or else an “attestation d’admission à la retraite” showing the date of termination. If you live in another country, please contact your local BIB’Action correspondent.

qUEstIOns/AnsWERs

Special information for expatriates

Assignment to another country has no impact on your portfolio.

however, you should inform us of your new posting as soon as possible by sending us a signed international mobility form. In this way, you will be sure to:

- Receive all the documents or information to which you are entitled as a shareholder, including account statements, the French IFu reportable tax form (if applicable), the notice of annual meeting and the letter to Shareholders.

- Receive your dividend.

- Benefit from the appropriate tax treatment, depending on your country of residence.

there are two possibilities:

- You can request that your new country organization administer your share account.

- You can continue to have your account administered directly in France, as a non-resident.

The various mobility forms may be found on the Employee Shareholder pages of the Michelin France intranet. Just choose the one you need and return it completed and signed to your BIB’Action country correspondent or the CGEM Employee Shareholder Relations department.


annual ShareholderS meeting — The Annual Meeting offers an exceptional opportunity to learn about your company’s results and outlook. It also gives you a say, by voting on the proposed resolutions, in the major decisions the Company wishes to make.

an extraordinary Shareholders meeting (known in English as a Special Meeting) may be called at any time. This type of meeting is called to approve any changes in the Company’s by-laws, such as the appointment of Managing Partners and General Partners, or changes in the corporate purpose, name or share capital. The quorum is one fourth of the voting rights present or represented on first call and one fifth on second call. Resolutions are passed by a two-thirds majority of voting rights present or represented.

a combined (or Joint) ordinary and extraordinary Shareholders meeting combines both types of meeting on the same day and is called on the same notice of Meeting.

the diFFerent tYPeS oF Shareholder meetingS:

an ordinary Shareholders meeting (known as the Annual Meeting in English) must be held within six months after the end of the preceding fiscal year. during this meeting, management presents detailed information about the Group’s operations and results, and shareholders approve the financial statements for the year, set the amount of the dividend and elect or re-elect members of the supervisory bodies.

For an Ordinary Shareholders Meeting to officially conduct business and cast binding votes, at least one fifth of the voting rights must be present or represented by proxy on first call. no quorum is required for a Meeting held on second call. Resolutions are passed by a simple majority (50%) of voting rights present or represented by proxy.

You can demonstrate your interest in your Company’s business and management by voting on the resolutions. As every year, the 2010 Annual Shareholders Meeting was held on first call, with a more than 54% attendance rate.

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new the e-notice of meeting:

This year, all shareholders have been offered the possibility of receiving their notice of Meeting by e-mail.For Michelin, this process will help further its sustainable development commitment by significantly reducing paper and ink usage, while also generating major savings in printing and postage costs. For shareholders, the e-notice of Meeting guarantees timely delivery of proxy materials, without any risk of postal delays.

online voting: In the same way, assuming that shareholders at the Annual Meeting on May 13, 2011 approve the resolution concerning secure online voting, you will be able to vote online on resolutions submitted to the 2012 Annual Shareholders Meeting.

Postal voting 1) If you received the notice of Meeting by post, simply fill out your proxy/postal

voting form and send it back in the enclosed reply-paid envelope.

2) If you received your notice of Meeting by e-mail, print your proxy/postal voting form, fill it out and:- If you reside in France:

Enclose the form in the envelope (no stamp required) to: micHelin - assemBlee Generale lIBRE REPOnSE 74311 35764 SAInT GREGOIRE CEdEX

- Where you reside in another country, and you are not a Michelin Group employee: Enclose the form in a stamped envelope to: iron mountain - services assemblées ZA Cap Malo - CS 36859 35520 la Mézière - France

- Where you are not a French resident but you are a Michelin Group employee: Enclose the form in an envelope to: name of your company - micHelin ASSEMBlEE GEnERAlE

And send the envelope to your local country correspondent.

the michelin annual ShareholderS meetingFour or five weeks before the Meeting, you will receive the notice of Meeting, comprising: - the Meeting agenda,- an overview of the Company’s business during

the year and its results over the past five years,- a presentation of the resolutions submitted for

your approval and the text of the resolutions,- the proxy/postal voting form.

To attend and vote at the Annual Shareholders Meeting, you must own your Michelin shares at least three business days before the date of the Meeting, i.e. before midnight CET May 9, 2011.

If you cannot attend the Meeting in person, you can watch the webcast with a slight delay in the “Annual Shareholders Meeting” section of the www.michelin.com/shareholders website.


Your rightS aS a Shareholder — Buying a Michelin share makes you a part-owner of the Company.As such, and like every other shareholder, you are entitled to certain basic rights, such as the right to information, to participate in corporate actions, to receive a dividend and to attend and vote at shareholder meetings.

the right to information

You can find all of your Company’s financial information, results and other publications on www.michelin.com/corporate website.

the right to participate in corporate actions

As a shareholder, you are entitled to pre-emptive rights to subscribe or receive new shares or share equivalents issued as part of a corporate action.

Pre-emptive rights to subscribe new shares or share equivalents

If the Company issues new shares or share equivalents with pre-emptive subscription rights, you will be able to subscribe the new shares, pro-rata to your existing holdings.

Rights to bonus shares

If new shares are paid up by capitalizing earnings, reserves or additional paid-in capital, they are allocated to shareholders, pro-rata to their existing holdings on the day of issue.

the right to receive a dividend

the right to attend and vote at shareholder meetings

The Annual Meeting offers a perfect opportunity to learn about your Company, its situation and outlook, and to participate in its decision-making process by voting on the proposed resolutions.

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PaYment oF the 2010 dividend oF €1.78(Submitted to the Annual Shareholders Meeting of May 13, 2011)

Shareholders will be offered the option of reinvesting all of their dividend in new shares.

This option must be exercised by sending a duly completed share purchase form to the paying agent for receipt between May 20, 2011 and close of business on June 7, 2011.

Shareholders who have not exercised their option within this period will receive the total dividend in cash.

Shares allocated in payment of dividends will be issued at a price equal to 90% of the average of the opening prices quoted for the Company’s shares on nYSE Euronext Paris over the twenty trading days preceding the Meeting at which the dividend payment date is approved (i.e. from April 13 to May 12, 2011), less the amount of the dividend (e1.78) and rounded up to the nearest euro cent.

The amount of the dividend available for reinvestment shall be the amount net of withholding tax, i.e. for shareholders who are tax residents of France, after the applicable social security and additional contributions withheld at source by the Company at a rate of 12.3%, or, in the case of non-residents (individual and corporate), after the applicable 25% withholding tax.

If the amount of the reinvested dividends does not correspond to a whole number of shares, the shareholder will receive the next lower number of shares and the balance in cash.

The issued shares will carry dividend rights from January 1, 2011 and rank pari passu with existing shares. They will be delivered to the paying agents on June 20, 2011.

The cash dividend will be paid as from June 20, 2011.

the record date is May 19, 2011.To be eligible for the dividend, you must be a shareholder at that date.the ex-dividend date is May 20, 2011.

For additional information concerning the dividend payment, please refer to the press release issued after the Annual shareholders Meeting, posted in the “Annual shareholders Meeting” pages on the www.michelin.com/shareholders website.


adjusted priceThe price of a share recalculated to reflect any transactions changing the number or value of shares outstanding, such as stock splits or share issues for cash. Adjustment means that prices remain comparable over time.

autorité des marchés Financiers (amF)The French securities regulator, formed from the 2002 merger of the Commission des Opérations de Bourse (COB) and the Conseil des Marchés Financiers (CMF). It establishes the organizational and ethical guidelines governing the French financial marketplace, and acts as a watchdog in protecting security investments and verifying the quality of investor information. It also oversees rating agencies, financial analysts and the markets.

blue chip stockA stock that is widely traded and highly popular with the investing public, thanks to its track record of earnings growth and dividend payments.Michelin is a blue chip in compartment A of the NYSE Euronext Paris stock exchange, which comprises companies with a market capitalization of more than €1 billion.

bondA debt security issued by companies or public organi-zations, paying interest and redeemable at a pre-deter-mined date and price.

cac 40 indexThe benchmark stock index comprising 40 of the 100 largest, most actively traded stocks listed on the regulated nYSE Euronext Paris markets.

capital gain or lossThe difference between a security’s purchase price and selling price.

consensusThe average forecast figures issued by financial analysts that cover a stock.

consolidated financial statementsFinancial statements that present the financial situation of a group of companies as if they were a single organization. For companies listed in Europe, these statements must be prepared in accordance with International Financial Reporting Standards (IFRS).

couponThe right for the owner of a security to receive the dividend (in the case of a share) or the interest (in the case of a bond) paid in a given year.

custodial feesFees charged by the custodian that holds securities in safekeeping for an investor. Compagnie Générale des Établissements Michelin does not charge any custody fees on shares directly registered with the Company.

diluted earnings per shareEarnings per share adjusted for the potential increase in shares outstanding following the exercise of subscription rights, stock options or other securities redeemable, convertible, exchangeable or otherwise exercisable for shares of the Company.

dilutionThe decrease in earnings per share resulting from the issue of new shares for cash, in exchange for shares of another company or on conversion of convertible bonds.

dividend The portion of net income for the year that a company pays to shareholders. In the case of Michelin, which is a partnership limited by shares, the amount is recommended by the Managing Partners and approved by shareholders in Annual Meeting.

earnings per share (ePS)net income attributable to Company shareholders divided by average shares outstanding for the year. EPS is used by financial analysts to assess a company’s performance over several years or to compare the relative performance of companies in the same industry. It is also used to calculate the price-earnings ratio.

ebitda Earnings before Interest, Taxes, depreciation of property, plant and equipment, Amortization of intangible assets and related impairment losses.

economic assetsIn French accounting, a company’s “economic assets” cor-respond to its property, plant and equipment, intangible non-current assets and certain other non-current assets, net of depreciation and amortization, plus its working capital. Their counterpart of the liabilities side is capital employed.

employee Stock ownership Plan (eSoP) A shareholder-authorized plan enabling employees to purchase shares in their company under special terms and conditions.

entreprise valueOften used to value a potential acquisition, enterprise value equals total market capitalization plus net debt, generally measured at market value.

Financial gloSSarY

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equity (before or after dividend payout)

Equity is the portion of a company’s total capital that belongs to the shareholders. It comprises shares of common and preferred stock, the portion of prior-year earnings retained in reserves and: • Net income for the year, before dividend payout.• The portion of net income for the year retained in

reserves, after the payment of a dividend.

euronext 100A stock index comprising the 100 largest, most actively traded stocks on the pan-European Euronext exchange (Amsterdam, Brussels, lisbon and Paris).

Free cash flowFree cash flow equals earnings before depreciation, amortization and provisions, less:• The change in working capital requirement. • Capital expenditure and investments, net of proceeds

from disposals.As an indicator, it is used to manage how funds are used and thereby track the change in debt.

Free float The portion of a company’s shares that are publicly traded. The larger the free float, the wider the market for the shares and the more liquid the investment.Michelin’s free float is 100%, i.e. all of its shares are publicly traded.

gearingThe ratio of a company’s net debt to equity.

goodwillThe excess of the purchase price of a company and the fair value of its net assets when they are first consolidated.

international Financial reporting Standards (iFrS)

International accounting standards defined by the International Accounting Standards Board (IASB). All listed companies in the European union have been required since January 1, 2005 to use IFRSs to prepare their consolidated financial statements, to facilitate intra-Eu comparisons.

market capitalizationThe value of a company if all of its shares were purchased on the open market at a given time. It is equal to the share price times the number of shares outstanding. Michelin’s market capitalization stood at €9.48 billion at December 31, 2010.

markets in Financial instruments directive (miFid)

The European union directive designed to provide harmonized regulation for investment services across the 30 member states. Effective since november 2007, it defines the rules governing the market activities of authorized financial intermediaries, as well as investor protection rules.

minimum trade unitThe smallest number of shares that can be bought or sold in a single trade.In Michelin’s case, the minimum trade unit is one share.

net debt debt less cash and cash equivalents (mainly marketable securities).

net income or lossA company’s profit or loss after paying corporate income tax. This amount is then attributable either to shareholders of the Company or to non-controlling (minority) interests.

non-controlling interestsnon-controlling (or minority) interests are the minority portion of shares held by other investors in the fully consolidated subsidiaries of a company.

non-recurring income and expenseMaterial operating income and expense items that are unusual, exceptional or infrequent.

nYSe euronext ParisThe company that organizes, manages and develops the Paris securities market. It also acts as a market regulator on behalf of the AMF.

operating incomeA company’s income before net finance costs, income tax and share of profit or loss from associates.

operating marginOperating income divided by net sales before vAT.

Par valueThe initial value of a share as set in the Company’s bylaws. Share capital equals par value times the number of shares outstanding.The par value of Michelin shares is €2.00.

Pay-out ratioThe percentage of net income paid to shareholders in the form of a dividend.

Price-earnings ratio (Per)The price of a stock divided by the company’s earnings per share. It enables investors to compare the relative value of different stocks.


Public tender offerA public bid to purchase a listed company by offering to buy outstanding shares in exchange for either cash (cash tender offer) or shares (stock-for-stock tender offer).

quorumThe minimum percentage of voting rights present or represented by proxy required for a Shareholders Meeting to officially conduct business and cast binding votes.

quoteThe market price of a security at a given moment, corres-ponding to either the bid price, the ask price or the last sale price.

return on assets (roa) Operating income divided by economic assets.

return on capital employed (roce)Operating income after tax (calculated directly on operating income) divided by average capital employed. ROCE measures the return on capital invested by shareholders (equity) or loaned to the company by banks and other financial partners (debt).The difference between ROCE and ROA is that the former is calculated after tax.

roll-over In the case of stocks eligible for the nYSE Euronext Paris market’s SRd deferred Settlement System, investors can take until the end of the trading month to pay for or settle the shares they have purchased or sold. They also have the possibility of rolling over payment or settlement until the next trading month-end.

Settlement date The monthly date when transactions carried out under the nYSE Euronext Paris market’s deferred Settlement Service are settled, corresponding to the fifth trading day before the last trading day of the month.

ShareA tradable security representing a portion of a company’s capital. Share ownership conveys a number of rights, such as the right to information and to vote at Shareholders Meetings, the right to receive a portion of the Company’s profits (dividends) and the right to subscribe new shares before the investing public (pre-emptive subscription rights). Shares may be held in registered or bearer form.

Share turnover rationumber of shares traded during the year divided by the average number of shares outstanding for the year.

Socially responsible investing (Sri) Socially responsible investors consider social and/or environmental issues along with financial objectives in weighing an investment decision, in a commitment to encouraging companies to act more responsibly.Michelin is rated by the leading ISR agencies, including SAM and Stoxx for DJSI (world and Europe), Ethibel for ESI and VIGEO for ASPI Eurozone.

Srd deferred Settlement ServiceA service offered by nYSE Euronext Paris that allows investors to pay for or settle certain stocks at the end of the trading month, instead of at the time of the trade. A fee is charged for the service by your bank or broker.The Michelin share is eligible for deferred settlement.

Stock market indexAn index measures the performance of a given securities market or sector by representing the simple or weighted average of the prices of a basket of underlying securities.

Stock optionsStock options are granted to employees or executives to give them a greater stake in their company’s performance. The option allows the grantee to purchase new or existing shares of company stock at a pre-determined price within a certain period of time after the options vest.

total shareholder return (tSr)TSR equals dividend income plus the increase (or less the decrease) in the share price compared with the acquisition cost.

trade advicenotice sent by a broker or bank confirming that a buy or sell order has been executed at a given time and given price.

treasury stockOwn shares held by the Company in treasury. These shares are stripped of the voting rights and are not entitled to a dividend.Michelin did not hold any shares in treasury as of December 31, 2010.

ucitS (undertakings for collective investment in transferable Securities)

Investment companies that raise funds from shareholders to purchase a variety of investment vehicles (stocks, bonds, etc.). They may be open-ended, in the sense that they may issue more shares at any time, or close-ended, in that they have a fixed number of shares. The former are known as mutual funds (uS), unit trusts (uK) or SICAvs (France) and the latter as investment trusts (uS/uK) or FCPs (France).

volatilityThe change in the price of a share compared with the general market trend.

working capital requirement (wcr)In French accounting, working capital requirement corresponds to the value of inventory and trade receivables, less trade payables.

YieldThe dividend per share divided by the share price.

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2011 Investor calendar

FInancIal InForMatIon

Annual Shareholders Meeting May 13, 2011

2010 annual results February 11, 2011

Quarterly information for the three months ending March 31, 2011 April 21, 2011

First-half 2011 results July 29, 2011

Quarterly information for the nine months ending September 30, 2011 October 26, 2011

MeetInGs WIth PrIvate shareholders In France

Marseilles March 21, 2011

Toulouse April 5, 2011

Lille May 31, 2011

Metz September 22, 2011

Annecy September 27, 2011

Rennes November 9, 2011

Paris, as part of the Actionaria investor fair November 19, 2011

Investor FaIr

Actionaria – Paris - Palais des Congrès November 18-19, 2011

Design and production:

Photos : © Michelin, © Michelin/Pierre-François Grosjean, © Michelin/Mario Renzi, © Michelin/Joël Peyrou, © Michelin/Thierry

Gromik, © Michelin/Éric Malherbe, © Michelin/Le Studio Photo, © Michelin/Pierre Chambon, © Michelin/Arnaud Childeric,

© Euromaster/B. Litjes.

IndIvIdual shareholder relatIonsJacques Engasser+33 (0) 4 73 98 59 0012, cours Sablon63040 Clermont-Ferrand Cedex 9 – FranceToll-free calls in France: 0 800 000 [email protected]

Investor relatIonsValérie MagloireAlban de Saint Martin +33 (0) 1 45 66 16 1546, avenue de Breteuil75324 Paris Cedex 07 – [email protected]

michelin individual shareholder’s guide 2011 edition · michelin individual shareholder’s guide...

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