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Valeo — MainFirst Automotive Conference, IAA 2007
34 slides from Valeo's conference presentation, Sep 11, 2007
Slide 1: MainFirst Automotive Conference IAA 2007
MainFirst Automotive Conference IAA 2007 Thierry Morin September 11, 2007 Chairman & CEO IAA Conference 1 September 11, 2007
Slide 2: Agenda
Agenda Valeo committed to enabling a better automotive world H1-2007 financials Strategy update IAA Conference 2 September 11, 2007
Slide 3: The Automotive Dilemma / The Valeo Answers
The Automotive Dilemna The Valeo answers IAA Conference 3 September 11, 2007
Slide 4: The automotive dilemma
The automotive dilemma
Slide 5: Growing vehicle production
Growing vehicle production Number Number of of Vehicles Vehicles Total 62.1 63.6 66.1 68.0 70.8 74.2 76.9 80.0 82.4 84.8 87.3 in ml 18 000 000 W.Europe 16 000 000 N.America 14 000 000 China 12 000 000 Japan 10 000 000 E.Europe 8 000 000 6 000 000 4 000 000 S.America 2 000 000 0 2 004 2 005 2 006 2 0
Slide 6: Car park set to double over the next 25 years
Car park set to double over the next 25 years million million 1200 1,200 m estimated by 2030 1000 800 600 Currently est. 630 m 400 200 0 1900 1920 1940 1960 1980 2000 2020 Year Year IAA Conference 6 September 11, 2007
Slide 7: Climate Change: CO2 Emissions
Climate Change: CO2 Emissions CO CO22 (ppm) (ppm) in in atmosphere atmosphere 600 500 400 300 200 1000 1200 1400 1600 1800 2000 Year Year Source: Intergovernmental Panel on Climate Change IAA Conference 7 September 11, 2007
Slide 8: CO2 Emissions: Breakdown
CO2 Emissions: Breakdown AIR; AIR; 3% 3% ROAD; ROAD; 18% 18% SHIP; SHIP; 2% 2% Other; Other; 1% 1% Others; Others; 5% 5% RESIDENTIAL; RESIDENTIAL; 8% 8% ENERGY; ENERGY; 45% 45% INDUSTRY; INDUSTRY; 18% 18% Total transportation sector: 24 % of WW CO22 emission Source: International Energy Agency IAA C
Slide 9: CO2 Regulation
CO2 Regulation Europe: 120g CO22/km Japan: by 2012 16,8 km/l by 2015 USA: 95g CO22/km Council Council for for transport transport 35 MPG by 2020 Policy Policy European European Commission Commission February February 2007 2007 by 2020 Jan. Jan. 10, 10, 2007 2007 Senate Senate Bill Bill June June 21,
Slide 10: Accident Statistics
Accident Statistics July 2006 Road safety evolution in EU Source EU Commission More than 100 people do not come back home everyday IAA Conference 10 September 11, 2007
Slide 11: Government Safety Goals
Government Safety Goals Japan: 50% reduction in road fatalities by 2013 Australia: 40% reduction in road fatalities by 2010 USA: 33% reduction in road crashes by 2008 Europe: 50% reduction in road fatalities by 2010 Governments are reacting IAA Conference 11 September 11, 2007
Slide 12: Valeo answers
Valeo answers
Slide 13: Valeo Domains
Valeo Domains- Reconciling automobiles and safety by reinforcing the active aspects of accident prevention and avoidance. Reconciling automobiles and the environment by contributing to the creation of cleaner, more fuel-efficient vehicles. Reconciling automobiles and well-being by making vehicles ea
Slide 14: IAA Conference
IAA Conference 14 September 11, 2007
Slide 15: Valeo has adapted solutions
Valeo has adapted solutions Power on Low consumption - 3% Demand A/C compressor UltimateCooling™ -3-5% - 30- 40% Feasible! Thermal Management THEMIS™ - 4% Transmission DUAL CLUTCH - 4-6% Automation transmission Air Systems Cooled EGR system - 5-7% Hybridization MICRO HYBRID -6-15% (from StopStart to
Slide 16: Burden for OEMs - Opportunity for suppliers
Burden for OEMs- Opportunity for suppliers Powertrain value will significantly grow Î We expect + €1,000 to €1,500 average for 2012 OEMs have no choice: Î Best “cost-to-performance” solutions will be their priority Suppliers who have good solutions portfolio will immediately benefit from this
Slide 17: IAA highlights
IAA highlights —
Slide 18: StARS
StARS StARS: micro-hybrid starter-alternator t A RS on S dard stan T Now MAR hd S om w Fuel savings: up to fort 28% in congested urban traffic IAA Conference 18 September 11, 2007
Slide 19: Blind spot detection system
Blind spot detection system PACE Award 2007 Initial contracts for 2008 GM Buick et Cadillac Blind spot detection New contract to be announced shortly IAA Conference 19 September 11, 2007
Slide 20: Park4U
Park4U™ Ultrasonic technology- based driving assistance system World premiere on the VW Touran. Now on VW Tiguan and Touran Cross 9 new contracts with 5 European Brands Introducing the new generation in Frankfurt IAA Conference 20 September 11, 2007
Slide 21: H1-2007 financials
H1- 2007 financials
Slide 22: Half-year key figures
Half-year key figures In euro million H1-2007 H1-2006* Change Total operating revenues 5,286 5,309 -0.4% Operating income 169 169 = as % of total op. revenues 3.2% 3.2% = Net income 71 94 -24.5% Basic earnings per share (€) 0.92 1.23 -25.2% Return on capital employed* 12.4% 12.0% +0.4pt
Slide 23: Net financial debt walkdown
Net financial debt walkdown in euro million (17) 968 (78) (18) 85 940 Free Capital Dividends Others cash flow Net debt increase Net debt 31/12/2006 30/06/2007 IAA Conference 23 September 11, 2007
Slide 24: Shareholder's equity and net debt
Shareholder’s equity and net debt in euro million 1,833 1,752 Gearing: 55% Gearing: 51% 968 940 December 31, 2006 June 30, 2007 Shareholder's Equity incl. minority interests Net Debt * adjusted IAA Conference 24 September 11, 2007
Slide 25: Return on capital employed analysis
Return on capital employed analysis In euro million H1-2007 H1-2006 Change Capital employed 2,500 2,597 (3.7%) Annualized revenues 9,688 9,733 (0.5)% Asset turn (x) 3.88 3.75 0.13 Operating income margin 3.2% 3.2% 0.0% ROCE 12.4% 12.0% 0.4% * Capital employed excludes goodwill IAA Conferen
Slide 26: Strategy update
Strategy update
Slide 27: Portfolio management
Portfolio management Focus on technology through the Domain approach Î Active portfolio management – Acquisitions: JCEED, Connaught Electronics (€473msales) – Disposals: Motors & Actuators, Wiring (€798m sales) IAA Conference 27 September 11, 2007
Slide 28: Acquisition of Connaught Electronics Ltd.
Acquisition of Connaught Electronics Ltd. Expert in camera– based vision solutions for low- speed maneuvering 300 employees in 2 sites in Ireland and the Czech Republic 2007 sales: €37 million Strengthens the Driving Assistance Domain IAA Conference 28 September 11, 2007
Slide 29: Planned disposal of the wiring harness business
Planned disposal of the wiring harness business Part of Valeo €2bn sales disposal plan by end of 2008 Disposal following successful restructuring Rationale of the disposal Î Low value added Î Lack of customer diversification Î No value added to our Domain approach Closing completed by year-e
Slide 30: Remains focused on long term value creation
Remains focused on long term value creation Portfolio reshuffling Reiterate 2010 financial objectives Î 6%+ operating margin Î Above 4.5x asset turn at constant perimeter IAA Conference 30 September 11, 2007
Slide 31: Back up
Back up
Slide 32: Share Information
Share Information Share Data / ADR Data Share Data Bloomberg Ticker FR FP Reuters Ticker VLOF.PA ISIN Number FR 000130338 Shares outstanding as per 30.06.2007 78,149,729 ADR Data Ratio (ordinary share: ADR) 1:2 Bloomberg Ticker VLEEY US Reuters Ticker VLEEY PK ISIN Number US 91913430
Slide 33: Quarterly P&L
Quarterly P&L (in euro million) 2Q-2007 1Q-2007 2Q-2006 1Q-2006 NET SALES 2,611 2,612 2,627 2,630 Other operating revenues 35 28 28 24 TOTAL OPERATING REVENUES 2,646 2,640 2,655 2,654 GROSS MARGIN 414 396 420 415 as % of net sales 15.9% 15.2% 16.0% 15.8% Research & Development expenditure (177
Slide 34: Contact Investor Relations
Contact Investor Relations Rémy Dumoulin 43, rue Bayen F-75848 Paris Cedex 17 France Tel.: +33 (0) 1.40.55.29.30 Fax: +33 (0) 1.40.55.20.40 E-mail: remy.dumoulin@valeo.com Web site: www.valeo.com IAA Conference 34 September 11, 2007