Valeo Se · EURONEXT:FR
Valeo — Paris Auto Show Investor Conference 2010
21 slides from Valeo's conference presentation, Sep 29, 2010
Slide 1: Delivering sustainable performance, towards 2013 objectives
Delivering sustainable performance, towards 2013 objectives Jacques Aschenbroich – CEO Paris Auto Show Investor Conference September 29, 2010
Slide 2: Agenda
Agenda 1 Back to organic growth 2 Best-in-class in terms of ROCE 3 Sustainability of operating performance 4 Better than expected 2010 production forecasts September 29, 2010 I 2 I
Slide 3: Back to organic growth
Back to organic growth Order intake at a record level Outperforming the market in each region Outperforming the market in each Asian country Rebalancing geographical exposure Rebalancing client exposure September 29, 2010 I 3 I
Slide 4: Record order intake at €6.5 billion
Record order intake at €6.5 billion At a margin level in line with long term Group objectives Customers H1-10 (% of order intake) German 31% French* 24% Asian** 18% Order intake (Order Intake / OE Sales) American 23% * Excluding Nissan ** Including Nissan 1.64x 1.52x 1.45x 1.29x 2007 2008 2009 H1-10
Slide 5: Outperforming the market in each region
Outperforming the market in each region World H1-10 OE sales Valeo* +40% Production +39% Production +72%** Production +23%** +86%* +31%* North America Europe 12% of sales 61% of sales Production +43%** +59%* Production +17%** Asia +19%* 19% of sales South America 8% of sales * At same perimeter & ex
Slide 6: Outperforming the market in each country
Outperforming the market in each country Asian OE sales Production +43%** +59%* Asia Production +47%** Production +37%** 19% of sales +55%* +49%* Korea Japan Production +47%** 19% of sales 32% of sales +72%* China Production +36%** 40% of sales +89%* India 4% of sales * At same perimeter & exchange
Slide 7: Rebalanced geographical exposure
Rebalanced geographical exposure In % of OE sales 67% 61% Europe Europe & Africa & Africa 8% 8% South South America America 9% 16% 12% 19% North Asia & North Asia & America Others America Others H1-09 H1-10 September 29, 2010 I 7 I
Slide 8: Rebalanced client exposure
Rebalanced client exposure In % of OE sales 29% 27% German German 26% 24% French* French* 16% 19% 18% 21% American Asian** American Asian** H1-09 H1-10 * Excluding Nissan ** Including Nissan September 29, 2010 I 8 I
Slide 9: Best-in-class in terms of ROCE
Best-in-class in terms of ROCE Operating margin at highest level in 10 years Flexibility of the cost structure Strong free cash flow generation Back to investment grade Full transformation of operating margin into cash September 29, 2010 I 9 I
Slide 10: Highest operating margin recorded in the last 10 years
Highest operating margin recorded in the last 10 years With sales close to pre-crisis level Sales 6000 (in € million) 0,2 0,19 4,848 4,787 5000 0,18 4,027 4000 3,829 0,17 3,472 0,16 3000 0,15 2000 0,14 Operating margin 1000 0,13 (in € million & as % of sales) 0,12 350 7 0 0,11 6.1% H1-08 H2-08 H1-09
Slide 11: Flexibility of the cost structure
Flexibility of the cost structure Better fit with current environnement Worldwide headcount evolution vs situation end of H1-2008 Permanents Temporaries Global headcount 3000 0 -3000 -6000 -9000 -12000 -15000 -18000 -21000 Jun 08 Dec 08 Jun 09 Dec 09 Jun 10 September 29, 2010 I 11 I
Slide 12: Strong free cash flow generation of €291 M
Strong free cash flow generation of €291 M H1-10 figures Operating performance EBITDA at €564 M (11.8 % of sales) Free cash flow Operating working capital of Further improvement by €41 M to - €341 M €291 M Tangible investments Limited to 60% of depreciation in H1 2010 Net financial debt Reduced by €
Slide 13: Target: back to investment grade
Target : back to investment grade Valeo rating upgraded to Ba1 stable outlook (July 29, 2010) Shareholders’ equity and net debt Net financial debt over EBITDA Net debt (M€) Shareholders’ equity (M€) excluding minority interests Net debt (M€) EBITDA 12 months rolling (M€) 1,468 1,233 1,128 1,005 841
Slide 14: Full transformation of operating margin into cash
Full transformation of operating margin into cash H1-10 key achievements H1-08 H1-09 H1-10 ▲H1-10/H1-09 Total sales (M€) 4,848 3,472 4,787 +38% OE Sales (M€) 4,026 2,743 3,957 +44% Worldwide automotive production – light 36.7 26.3 36.5 +39% vehicles (M units) Gross margin (as % of sales) 16.4% 13.0%
Slide 15: Sustainability of operating performance
Sustainability of operating performance Ahead of 2013 targets 82% of 2013 OE sales already in order book Growth in Asia and emerging countries of CO2 emission reduction related products New organization on track Visibility Systems Business Group turnaround Confidence in sustainability of current fin
Slide 16: 82% of 2013 OE sales already in the order book
82% of 2013 OE sales already in the order book €10 Bn sales target in 2013 Order intake at a record level of 1.64 or €6,478 M Asian, North and South American production ahead of the Plan In 2013, production in Europe and North America expected to stay below pre-crisis level September 29, 2010 I 16 I
Slide 17: New organization
New organization Implementation on track Better fit with client requirements Worldwide organization Global tender offers Contribution to organic growth Fixed cost reduction Centralization of support functions Positive impact on operating margin of at least 100bp (vs 2009) CAPEX optimization 60% Asia
Slide 18: Visibility Systems Business Group turnaround
Visibility Systems Business Group turnaround Convergence of Visibility Systems BG with other Business Groups performance H1-10 Comfort & Driving Assistance as % of sales 11.8 % Powertrain as % of sales 9.7% Thermal as % of sales 13.3% Visibility 14% as % of sales 11.4% 12% TOTAL 11.8% 10% 8% 6% 4% 2
Slide 19: Confidence in sustainability of current financial performance in normal market conditions
Confidence in sustainability of current financial performance in normal market conditions In line with 2013 objectives 2009 H1-10 2013 ∆ 2013/2009 Total sales €7.5 bn €4.8 bn €10 bn +33% Operating margin 1.8% 6.1% 6-7% + 4-5pt Capital turnover 3.9 4.7* 5 +1.1 ROCE** 7.1% 25%* ≥ 30% > +20pt * Calcula
Slide 20: Better than expected 2010 market forecasts
Better than expected 2010 market forecasts Q3 sales and full year 2010 guidance to be presented on October 21, 2010 (change YoY) Full year previous revised Europe (& Africa) +6% +10% Asia (& others) +18% +22% North America +30% +34% South America +12% +12% Worldwide +16% +19% With Valeo outperformin
Slide 21: Automotive technology, naturally
Automotive technology, naturally