FY 2018 RESULTS JACQUES ASCHENBROICH – CHAIRMAN & CEO JACQUES ASCHENBROICH – CHAIRMAN & CEO February 21, 2019
2018 RESULTS IN LINE WITH OCTOBER GUIDANCE THANKS TO COST SAVING PLAN 2018 RESULTS IN LINE WITH OCTOBER GUIDANCE THANKS TO COST-SAVING PLAN October 2018 guidance 2018 results S l Sales growth at constant exchange rates th t t t h t +6% 6% +6% 6% H2 OEM outperformance +2pts +3pts Operating margin (excl. JV & associates) 6.2% - 6.5% 6.3% JV & associates -0.4% - -0.5% -0.6% Free cash flow €120m - €150m €161m 2 February 21, 2019
SUCCESSFUL & ACCRETIVE INTEGRATIONS SUCCESSFUL & ACCRETIVE INTEGRATIONS 3 February 21, 2019
2018 DIVIDEND OF €1.25/SHARE TO BE PROPOSED AT THE NEXT AGM 2018 DIVIDEND OF €1.25/SHARE TO BE PROPOSED AT THE NEXT AGM 1.25 1.25 1.25 Dividend (€/share) 1.0 0.73 0.57 0 5 0.5 0.47 0.4 2010 2011 2012 2013 2014 2015 2016 2017 2018 EPS (€/share) 1.62 1.89 1.68 1.90 2.41 3.11 3.91 3.69 2.30 EPS excl. non-recurring items (€/share) EPS 1 62 1.62 1 89 1.89 1 85 1.85 2.17 2 17 2 54 2.54 3 52 3.52 3.98 3 98 4 33 4.33 2 52 2.52 Payout ratio 25% 25% 30% 30% 30% 32% 32% 34% 54% 2018 DIVIDEND OF €1.25/SHARE LEADING TO A PAYOUT RATIO OF 54% 4 February 21, 2019
GEOPOLITICAL & MACRO ECONOMIC HEADWINDS GEOPOLITICAL & MACRO ECONOMIC HEADWINDS RAW FOREIGN GEOPOLITICS MATERIALS EXCHANGE TRADE & EXPORT VOLATILITY VOLATILITY WAR CONTROLS Iran-related activities Iran-related activities Dedicated mitigation plans Dedicated mitigation plans shutdown shutdown February 21, 2019 5
AUTOMOTIVE SECTOR IN (R)EVOLUTION AUTOMOTIVE SECTOR IN (R)EVOLUTION DECLINE IMPLEMENTATION IMPLEMENTATION IN CHINESE IN CHINESE SOFTWARE SOFTWARE OF WLTP PRODUCTION AND AI NEWCOMERS ~25% of our Valeo ~25% of our Valeo 25% of our Valeo 25% of our Valeo New customers & New customers & engineers are now engineers are now Launch of a cost reduction plan in H2 2018 Launch of a cost reduction plan in H2 2018 new business new business software engineers software engineers models models Creation of Creation of February 21, 2019 6
AN INTEGRATED MODEL FULLY CENTERED ON THE 3 AUTOMOTIVE REVOLUTIONS AN INTEGRATED MODEL FULLY CENTERED ON THE 3 AUTOMOTIVE REVOLUTIONS EXAMPLE OF EXAMPLE OF INTERIOR COCOON EXAMP E OF EXAMPLE OF SENSOR CLEANING SYSTEMS 7 February 21, 2019
2019 OUTLOOK 2019 OUTLOOK February 21, 2019
STRICT CONTROL OF R&D, SG&A AND CAPEX STRICT CONTROL OF R&D, SG&A AND CAPEX INCREASED EFFICIENCY PLANS MASSIVE SHIFT TO STANDARDIZATION (BY BUSINESS AND OFFSHORE PRODUCT) SOFTWARE SOFTWARE PLATFORMS CAPEX ACCELERATION OF NEAR-TERM STRICT CONTROL SHIFT TO LOW- IMPLEMENTATION COST COUNTRIES OF VALEO PLANT CAPACITY REUSE OF THE FUTURE AND MANAGEMENT VARIABILIZATION OF COSTS OF COSTS AUTOMATION AUTOMATION OPERATIONS OPERATIONS 9 February 21, 2019
A GRADUAL INCREASE IN LIKE-FOR-LIKE GROWTH AND MARKET OUTPERFORMANCE DURING THE YEAR OUTPERFORMANCE DURING THE YEAR Arrival of new platforms in 2019 p Examples of new products p p +85% Content per car Content per car for Valeo leading to Average content €x / +x% vs previous vehicles % i hi l +€800m Additional sales Additional sales in 2019 10 February 21, 2019
2019 OUTLOOK 2019 OUTLOOK In a context of: volatile global automotive production (estimated growth of between 0% and -1% over the year compared with 2018) with l til l b l t ti d ti ( ti t d th f b t 0% d 1% th d ith 2018) ith a decline in the first half due to the economic environment in China, and an improvement in the second half; uncertainty regarding the price of raw materials and electronic components. The Valeo Group has set the following objectives: a stronger market outperformance than in second-half 2018, increasing gradually during the year thanks to the start of production on new contracts, particularly in the camera, electrical and transmission systems, and lighting segments; roll-out of a new program to reduce costs by more than 100 million euros and capital expenditure by more than 100 million euros; EBITDA growth (in value terms); higher free cash flow generation than in 2018; operating margin excluding share in net earnings of equity-accounted companies (as a % of sales) of between 5.8% and 6.5%, depending on the trends in automotive production and in the price of raw materials and electronic components; a “share in net earnings of equity-accounted companies” line which as announced is expected to have a similar impact a share in net earnings of equity-accounted companies line which, as announced, is expected to have a similar impact on Valeo’s 2019 statement of income as it did in 2018. 11 February 21, 2019
GROWTH POTENTIAL CONFIRMED 2018 ORDER INTAKE AT 1.7X OEM SALES OR €28.6bn €24.2bn OR 1.5X OEM SALES (EXCL. VALEO SIEMENS E AUTOMOTIVE) , 10% CAGR SINCE 2013 €4.4bn AT VALEO SIEMENS E AUTOMOTIVE, A CUMULATIVE €10.5bn AT YEAR-END February 21, 2019
TOTAL ORDER INTAKE OF €28.6bn €24.2bn EXCLUDING VALEO SIEMENS EAUTOMOTIVE… …CONFIRMING VALEO S FUTURE CAPACITY TO OUTPERFORM AUTOMOTIVE PRODUCTION CONFIRMING VALEO’S FUTURE CAPACITY TO OUTPERFORM AUTOMOTIVE PRODUCTION Full-year order intake*** €bn V l Valeo Siemens eAutomotive Si A i 33.7 A cumulative €10.5bn order intake at year-end 28.6 6.1 4 4 4.4 27.6 24.2 23.6 20.1 17.5 15.1 14.8 14.1 11.9 CAGR** CAGR 9.6 9 6 9.4 9 4 8 9 8.9 8 8 8.8 7.1 +10% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1.4X* 1.6X* 1.6X* 1.9X* 1.7X* 1.6X* Valeo Siemens eAutomotive Valeo Siemens eAutomotive Valeo Valeo *Order intake / OEM sales ratio ** Reference 2013 2018 (excluding Valeo Siemens eAutomotive) *** See glossary page 83 excluding Access Mechanisms between 2005 & 2013 & Valeo Siemens eAutomotive 13 February 21, 2019
ORDER INTAKE/OEM SALES RATIO AT 1.7X (INCL. VALEO SIEMENS E AUTOMOTIVE) ORDER INTAKE/OEM SALES RATIO AT 1.7X (INCL. VALEO SIEMENS E AUTOMOTIVE) Order intake of €24.2bn OEM sales of €16.5bn 14% SA 2% Asia NA 18% SA Order Order Asia Asia excl. China 2% intake/OEM €3.4bn 41% NA 16% Asia excl. sales ratio €3.0bn China €9.9bn Asia 19% 34% Asia 1.8x €5.5bn Of which China 2.4x 44% 44% China China E Europe 1 4 1.4x 32% 32% 15% Europe with local with local China Europe Chinese North America 1.1x Chinese €10.5bn 25% OEMs OEMs €7.7bn South America 1.0x Group 1.5x 46% Incl. Valeo 43% 1.7x Siemens % % of 2018 order intake* f 2018 d i t k * % % of 2018 OEM sales* f 2018 OEM l * *OEM sales and order intake by destination including joint ventures but excluding Valeo Siemens eAutomotive 14 February 21, 2019
INNOVATION FUELING ORGANIC GROWTH INNOVATION FUELING ORGANIC GROWTH Valeo order intake 24 2 24.2 > €1bn order intake: AI-enriched surround €1b d i k AI i h d d Artificial Intelligence view & automated parking systems with by Valeo object and pedestrian detection features €1bn order intake for robotaxis Valeo 53%* Increasing order intake for cross-Business Increasing order intake for cross Business Group systems 2018 Innovation* OI CAGR 2013-2018: +10% * Products and technologies sold by less than 3 years excl. Valeo Siemens eAutomotive February 21, 2019 15
Non- IFRS 15 Q4 2018 SALES TOTAL SALES OF €4 8bn UP 1% AT CONSTANT EXCHANGE RATES TOTAL SALES OF €4.8bn, UP 1% AT CONSTANT EXCHANGE RATES DOWN 2% LIKE FOR LIKE H2 2018 SALES H2 2018 SALES TOTAL SALES OF €9.3bn, UP 3% AT CONSTANT EXCHANGE RATES DOWN 1% LIKE FOR LIKE OEM SALES UP 2% AT CONSTANT EXCHANGE RATES DOWN 2% LIKE FOR LIKE AFTERMARKET SALES UP 7% AT CONSTANT EXCHANGE RATES AFTERMARKET SALES UP 7% AT CONSTANT EXCHANGE RATES UP 2% LIKE FOR LIKE February 21, 2019
Non- Q4 18 SALES UP 1% AT CONSTANT EXCHANGE RATES IFRS 15 DOWN 2% LIKE FOR LIKE DOWN 2% LIKE FOR LIKE At constant Q4 18 -1% -1% +3% +3% +37% +37% +1% +1% exchange rates 212 212 487 4,834 €m 4,135 OEM Aftermarket Miscellaneous Sales -3% +1% +28% -2% Like for like +0% +2% +23% +1% Reported Q4 17 Q4 17 4,134 Q4 17 478 Q4 17 173 4,785 Exchange rates +0.3% Exchange rates +0.5% Exchange rates -1.3% Exchange rates -14.5% Scope +2.8% Scope +2.0% Scope +9.4% Scope +2.6% 17 February 21, 2019
Non- H2 18 SALES UP 3% AT CONSTANT EXCHANGE RATES IFRS 15 DOWN 1% LIKE FOR LIKE DOWN 1% LIKE FOR LIKE At constant H2 18 +2% +2% +7% +7% +22% +22% +3% +3% exchange rates 314 969 9,322 €m 8,039 OEM Aftermarket Miscellaneous Sales -2% +2% +16% -1% Like for like +2% +5% +13% +3% Reported H2 17 H2 17 7,885 H2 17 924 H2 17 277 9,086 Exchange rates +0.0% Exchange rates +0.2% Exchange rates -1.8% Exchange rates -8.9% Scope +4.1% Scope +4.5% Scope +6.1% Scope +3.9% 18 February 21, 2019
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