Valeo: Strong Rise in 1998 Results
10 February 1999
Valeo: Strong Rise in 1998 Results
Valeo's Board of Directors, meeting on February 10, 1999, closed the Group's consolidated accounts for 1998.
(in millions)
1998 1997 % change
euros FFr euros FFr
Sales 6,019 39,480 5,179 33,970 + 16%
Gross margin 1,234 8,095 1,049 6,882 + 18%
Operating income 427 2,805 350 2,297 + 22%
Net income from 239 1,564 198 1,300 + 21%
consolidated companies
Net income 260 1,703 226 1,480 + 15%
Cash flow 636 4,172 549 3,599 + 16%
Capital expenditures 461 3,022 441 2,895
at 12/31/98 at 12/31/97
Stockholders' equity 2,090 13 709 1,865 12,234 + 12%
Net indebtedness 610 4 001 201 1,318
Results 1998
The Board of Directors confirmed the Group's provisional results published on January 21, 1999.
- Valeo's consolidated sales for 1998 totaled 6 billion euros, up
by 16.2% over 1997. This figure integrates for the last quarter
of 1998 the recently acquired Electrical Systems activities, and
it excludes the 61 million euros in sales generated by the
display and fuel tank cap and filler activities disposed of in
1998.
- Taking into account the acquisition of Electrical Systems,
Valeo's annualized sales amounted to 7.3 billion euros.
- Gross margin increased by 18% to 1,234 million euros, that is
20.5% of sales, against 20.3% in 1997. Operating margin rose by
22%, accounting for 7.1% of sales against 6.8% in 1997. Gross and
operating margins both grew faster than sales in a demanding
competitive environment, reflecting the cost-cutting actions
implemented by Valeo in 1998.
- Net earnings per share for 1998 amounted to 3.45 euros, an
increase of 7.5% compared with 1997. These figures take into
account the increase in the average number of shares that
occurred in 1998, following the issue of shares with warrants
attached in August 1998.
- Cash flow, up by 16% to 636 million euros, largely financed Group
capital expenditures. At December 31st 1998, Valeo's net
indebtedness stood at 610 million euros, that is a debt-to-equity
ratio of 29%.
- 1998 marked the 5th year in a row that saw a rise in Valeo's
results and net earnings per share. Between 1993 and 1998, Group
sales rose by 95% and net income by 142%.
Dividend 1998
The General Meeting of Shareholders that will be held to rule on the Group's 1998 accounts will be asked to approve a dividend of 1 euro per share, that is 1.5 euros including tax credit. This dividend corresponds to a pay-out ratio of 31.7%.
The dividend paid out by Valeo has increased four-fold in five years, rising from 0.24 euros in 1993 to 1 euro in 1998.
Outlook 1999
1999 opens against a background of sustained production both in Europe and North America, where Valeo generates 95% of its sales.
Valeo intends pursuing in 1999 the integration of Electrical Systems, whose acquisition in September 1998 gave it world leadership in Wiper Systems, in Electric Motors and in Switches and Sensors. The Group is engaging in reorganization and rationalization programs in Euroland and in North America.
In South America, the devaluation of the real has led to a fall in vehicle output as compared with the previous year. The Group is taking the necessary steps to adapt to the new environment in this region, where Valeo generates approximately 2% of its sales.
Valeo is an industrial group fully focused on the design, production and sale of components, integrated systems and modules for cars and trucks. The Group serves all automakers worldwide. Valeo has 115 plants and 29 R&D centers in 19 countries. For more information about Valeo and its businesses, please consult our Web site: http://www.valeo.com.