Valeo: Strong Rise in Quarterly Results
13 April 2000
Valeo: Strong Rise in Quarterly Results
PARIS--April 12, 2000--Valeo's Board of Directors, meeting on April 12, 2000, registered the first quarter 2000 results and noted their strong rise.1. Group results for the first quarter 2000 ---------------------------------------------------------------------- (in millions of euros) Q1 2000 Q1 1999 Change ---------------------------------------------------------------------- Sales 2,221 1,902 +17% ---------------------------------------------------------------------- Gross margin 432 363 +19% % sales 19.4% 19.1% ---------------------------------------------------------------------- Operating income 144 105 +37% % sales 6.5% 5.5% ---------------------------------------------------------------------- Operating income (less net financial charges) 145 100 +45% % sales 6.5% 5.2% ---------------------------------------------------------------------- Other income and expenses 0 (9) ---------------------------------------------------------------------- Taxes (43) (26) ---------------------------------------------------------------------- Net income from consolidated companies 102 65 +57% % sales 4.6% 3.4% ---------------------------------------------------------------------- Associated companies 0 19 ---------------------------------------------------------------------- Goodwill (18) (15) ---------------------------------------------------------------------- Minority interests (2) (1) ---------------------------------------------------------------------- Net income 82 68 +21% ---------------------------------------------------------------------- % sales 3.7% 3.6% ---------------------------------------------------------------------- Net earnings per share (in euros) 0.99 0.82 +20% ----------------------------------------------------------------------
The 17% increase in sales was driven by buoyant operations in Euroland and the United States and, even more strongly, by the emerging markets of Central Europe, Latin America and Asia.
2.
Operating income (less net financial charges) rose by 45%, to 145 million euro, accounting for 6.5% of sales versus 5.2% in 1999, under the impact of the following factors:
| - | a 19% increase in gross margin due to the speeding up of rationalization programs and productivity efforts, |
| - | controlled Research & Development expenses, which accounted for 6.7% of sales versus 6.9% in 1999, and selling and administrative expenses, which stood at 6.3% versus 6.7%, |
| - | a positive financial result of 1 million euro, compared with minus 5 million euro in 1999, as a result of the elimination of the Group's debt and the availability of cash resources. |
Net income after taxes and minority interests was up by 21% to 82 million euro, or 3.7% of sales, at a higher level than in 1999 and in a different structure characterized by the following factors:
| - | no new provisions added to those made at end 1999, while the tax rate rose from 28.8% to 29.5%, resulting in an increase in net income from consolidated companies of 57% to 102 million euro, versus 65 million euro in 1999, |
| - | no contribution from associated companies which, before the disposal of LuK in 1999, accounted for 19 million euro, |
| - | amortization of goodwill and minority interests amounting to 20 million euro, versus 16 million euro in 1999. |
Net earnings per share totaled 0.99 euro, up by 20% over 1999.
Commenting on these results, Noel Goutard stated: "Taking the quarterly seasonal impact into account, these results clearly show a rebound in internal growth and a strong improvement in margins. They are in line with the profitability objectives that we set for ourselves in 2000." Regarding the outlook for 2000, Noel Goutard added: "With its positive performance in the first quarter and a balance sheet that has been further strengthened in a favorable worldwide automotive environment, Valeo has the resources it needs to pursue its strategy of globalization, acquisitions and alliances, and technological development in electronics and e-business.
"The consolidation of the automotive industry and the dissemination of new information technologies are great opportunities for profitable growth for Valeo, while enabling the standardization of products and the simplification of transactions with our customers and suppliers."
3. Annual General Meeting - Dividend
Valeo's Annual General Meeting will be held on May 25, 2000, at 4 p.m., at the Palais des Congres in Paris. The AGM will be asked, among other things, to approve a dividend exceptionally increased to 1.5 euro.
For more information on the Group and its businesses, please consult our Web site: www.valeo.com