Press release – Q1 2019 Sales

Jacques Aschenbroich, Valeo’s Chairman and Chief Executive Officer, commented:

“Our outperformance versus automotive production accelerated in the first quarter, in line with our roadmap, in a challenging automotive market. This outperformance is set to continue to accelerate throughout the year in our four Business Groups and in all our geographic areas, thanks to the start of production on high-tech innovations.

In a particularly unstable economic and geopolitical environment, we are pressing ahead with our plan to reduce costs and capital expenditure and we confirm our objectives for 2019.”

• Consolidated sales of 4,841 million euros, down 1%, or 3% on a like-for-like basis⁽¹⁾.
• Original equipment sales of 4,121 million euros, down 1%, or 3% on a like-for-like basis outpacing global automotive production by 4 percentage points.
• Aftermarket sales down 4% as reported and on a like-for-like basis.

2019 outlook: guidance unchanged

In a context of:

• volatile global automotive production (estimated growth of between 0% and -1% over the year compared with 2018) with 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.

Valeo’s 2019 objectives remain unchanged:

• 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 the program, announced in February, to reduce costs by more than 100 million euros and capital expenditure by more than 100 million euros;
• EBITDA growth⁽¹⁾ (in value terms);
• higher free cash flow⁽¹⁾ 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 on Valeo’s 2019 statement of income as it did in 2018.

⁽¹⁾ See Financial Glossary, page 7.