VALEO (EPA:FR) Valeo reports 14% growth in consolidated sales for third quarter

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20/10/2011 17:59

Press release

24.11

    Valeo reports 14% growth in consolidated sales for third quarter 2011

* Third quarter 2011

   - 14% growth in consolidated sales (12% on a like-for-like basis(1)) to 2,662
     million euros
   - 17% growth in original equipment sales (14% on a like-for-like basis) to
     2,262 million euros

* Third quarter 2011 and nine months ended September 30, 2011
   - Original equipment outperformed the market in all Business Groups and main
     production regions

* Outlook
   - 2011 guidance confirmed, i.e., to achieve full-year operating margin rate
     slightly higher than that of 2010

Paris, France, October 20, 2011 - Following the meeting of its Board of
Directors today, Valeo released its sales for the third quarter 2011:

In millions of euros             Third quarter*    Nine months ended
                                                      September 30*
                              2010   2011    %     2010   2011    %
                                           change              change
                                            sales               sales
Total
of which:                     2,342 2,662   +14%   7,129 7,996   +12%
Original equipment            1,929 2,262   +17%   5,886 6,772   +15%
Aftermarket                     359   336    -6%   1,082 1,055    -2%
Miscellaneous                    54    64   +19%     161   169    +5%

* Unaudited

(1) Constant Group structure and exchange rates.

Jacques Aschenbroich, Valeo's Chief Executive Officer, stated:

"Thanks to our robust organic growth and the integration of Niles, Valeo
reported 17% growth in third quarter original equipment sales (14% on a
like-for-like basis), outperforming automotive production in all of our
businesses and main production regions for the eighth straight quarter. This
dynamic performance once again underscores the success of Valeo's strate gic
focus these past two years on developing products that reduce CO2 emissions and
on expanding business activities in emerging markets and Asia, a strategy that
has also been reflected in the acquisition of the Japanese automotive supplier,
Niles. This acquisition is in line with our objective of boosting our activities
in Asia, a region that accounted for 25% of our original equipment sales in the
third quarter of 2011."

In the third quarter 2011 and the first nine months of the year, global
automotive production remained robust in all regions. Production advanced 4%
compared to the first nine months of 2010.

In Japan, automotive production began to turn around, declining by 5% in the
third quarter compared to a drop of 31% in the first half of the year. For the
first nine months of the year, automotive production in Japan fell 21%.

Consolidated sales totaled 2,662 million euros in the third quarter of 2011, up
14% (12% on a like-for-like basis). In the first nine months of the year,
consolidated sales came in at 7,996 million euros, representing an increase of
12% on both a reported and like-for-like basis.

   * Changes in Group structure in the third quarter represented 4.2% of
     consolidated sales, including 106 million euros corresponding to the
     contribution of Niles.

   * Original equipment sales (85% of consolidated sales) came out at 2,262
     million euros in the third quarter, up 17% (14% on a like-for-like basis),
     and 6,772 million euros in the first nine months of the year, up 15% (14%
     on a like-for-like basis).

   * Original equipment sales in Asia represented 25% of total original
     equipment sales in the third quarter, further to the acquisition of Niles.

   * Aftermarket sales (13% of consolidated sales) amounted to 336 million euros
     in the third quarter, down 3% on a like-for-like basis, and stood at 1,055
     million euros in the first nine months of the year, edging up 1%
     like-for-like.

Original equipment sales outperformed the market in all the main automotive
production regions

Original           Third quarter*              Nine months ended September 30*
equipment

In millions  2010  2011    %    % change      2010  2011    %    % change
of euros                change  automotive               change  automotive
                          OE    production***              OE    production***
                        sales**                          sales**
Europe      1,057 1,188   +13%       +6%     3,438 3,908  +14%       +8%
Asia          420   568   +13%       +3%     1,209 1,372   +7%       -1%
of which
China         160   186   +22%       +4%       461   504  +14%       +4%
of which
Japan         129   221    -8%       -5%       364   409  -18%      -21%
North
America       288   326   +23%       +8%       776   966  +33%       +9%
South
America       177   180    +4%       +7%       496   526   +5%       +9%
* Unaudited
** Like-for-like
*** JD Power estimates

Strong sales momentum in the main production regions, combined with a positive
geographic mix enabled the Group to outperform global automotive production for
the eighth straight quarter (outperformance of 9 percentage points in the third
quarter 2011).

Valeo also grew faster than the market in the main automotive production regions
during the first nine months of the year:

· In Europe (58% of original equipment sales), the Group reported original
   equipment sales growth of 14% on a like-for-like basis, 6 percentage points
   higher than the market.

· In Asia (20% of original equipment sales), the Group recorded original
   equipment sales growth of 7% on a like-for-like basis, 8 percentage points
   higher than the market.

· In North America (14% of original equipment sales), the Group posted
   original equipment sales growth of 33% on a like-for-like basis, 24
   percentage points higher than the market.

All Business Groups contributed to the growth effort

Sales             Third quarter*              Nine months ended September 30*
equipment

In millions  2010  2011    %    % change      2010  2011    %    % change
of euros                change     OE                     change     OE
                        sales**   sales**                 sales**  sales**

Comfort &
Driving
Assistance
Systems      418    567   +12%      +15%    1,266   1,537   +14%   +16%
Powertrain
Systems      625    743   +17%      +21%    1,969   2,292   +18%   +21%
Thermal
Systems      735    777    +8%       +8%    2,182   2,336    +8%    +8%
Visibility
Systems      547    597    +9%      +13%    1,733   1,901   +10%   +14%

* Unaudited
** Like-for-like

The Business Groups all enjoyed buoyant growth momentum, with original equipment
sales rising faster than global automotive production (up 4% in the first nine
months of the year).

The Powertrain Systems, Comfort & Driving Assistance Systems and Visibility
Systems Business Groups outperformed global automotive production by 17, 12 and
10 percentage points respectively, thanks in particular to market share gains in
new technologies (Stop-Start, torque converter, driving assistance, cameras,
radars, innovative lighting systems, etc.). The Thermal Systems Business Group,
which has a strong presence in Japan, was more directly impacted by the drop in
production in this country.

The Group also achieved excellent results with its German customers, which
accounted for 29% of total original equipment sales for the first nine months of
the year, compared with 27% in the same year-ago period.

Highlights

At the IAA Frankfurt motor show held on September 13-25, 2011, Valeo presented
several innovations that will fuel the Group's development in the coming years,
including:

- Park4U(r) Remote: this fully automatic parking assistance system maneuvers the
  vehicle into a parking space without any input from the driver. It can be
  activated either from inside the vehicle or remotely, using a smartphone;

- Affordable Hybrid: an electrification solution for the powertrain. The
  Affordable Hybrid architecture consists of a motor-generator and low-voltage
  electronics (48V). By combining the Stop-Start function, regenerative braking
  and engine assistance, this system offers the advantages of a hybrid for a
  very low cost.

Other information

During the third quarter, Valeo concluded, in two tranches, the buyback of
1,228,000 shares for a total of 40.9 million euros. These shares were allocated
to cover stock option purchase plans.

Outlook

The automotive production growth forecast for 2011 is consistent with the
estimates published by Valeo. In this context, and despite the high price of
certain raw materials, particularly rare earths, in the second half of the year,
Valeo confirms its 2011 guidance, i.e., to achieve full-year operating margin
rate slightly higher than that of 2010.

Financial calendar

Full-year 2011 results: February 22, 2012 prior to stock market opening

Valeo is an independent industrial Group fully focused on the design, production
and sale of components, integrated systems and modules for the automotive
industry, mainly for CO2 emissions reduction. Valeo ranks among the world's top
automotive suppliers. The Group has 125 plants, 21 research centers, 40
development centers, 10 distribution platforms and employs 67,900 people in 28
countries worldwide.

For more information, please contact:
Media relations                     Thierry Lacorre, Investor Relations
Phone: +33 1.40.55.37.18            Phone: +331.40.55.37.93

For more information about the Valeo Group and its activities, please visit our
web site www.valeo.com

Safe Harbor Statement

Statements contained in this report, which are not historical fact, constitute
"Forward-Looking Statements". Actual results may differ materially due to
numerous important factors. Such factors include the cost and timing of
implementing restructuring actions, the company's ability to generate cost
savings or manufacturing efficiencies to offset or exceed contractually or
competitively required price reductions, conditions in the automotive industry,
and certain global and regional economic conditions. The company assumes no
responsibility for any analysts' estimates and any other information prepared by
third parties which we may reference in this report. Valeo does not intend or
assume any obligation to review or confirm analysts' estimates or to update any
forward-looking statement to reflect events or circumstances after the date of
this report.

source : webdisclosure.com

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