Bruno-Roland BERNARDInvestor Relat ions Director
…is an independent industrial Group fully focused on the design,
production and sale of components, integrated systems and modules for
cars and trucks, in both the OEM andaftermarket segments.
Sales development
Q 1 - 2 0 0 3 R e s u l t s4
Change in sales
Q1-2002 Q1-2003
2,5502,440
* at c o n s t a n t cu r r enc i e s
(in mill ion e u r o )
Net change*
+1.5 %
Gross changeo/w c u r r e n c i e s
- 4.0%
- 5.5%
Q 1 - 2 0 0 3 R e s u l t s5
Performance by region
North America
% change*: - 8%Production: + 2%Production: + 2%
South America
*at c o n s t a n t c u r r e n c i e s
Asia
Europe
% change*: + 2%Production: Production: -- 4%4%
% change*: + 26%Production: + 12%Production: + 12%
% change*: + 27%Production: + 15%Production: + 15%
Growing profitability
Q 1 - 2 0 0 3 R e s u l t s7
Q 1-01 Q 2-01 Q 3-01 Q 4-01 Q 1-02 Q 2-02 Q 3-02 Q 4-02 Q 1-03
Gross margin*
*u n a u d i t e d q u a r t e r l y f i g u r e s
+ 1.0 pt+ 1.0 pt
( i n % o f s a l e s )
15.015.0
16.516.5
17.517.5
Q 1 - 2 0 0 3 R e s u l t s8
Gross marginOngo ing actions (1)
l Rationalization of industrial footprint
l Increased supplier integration
Q 1 - 2 0 0 3 R e s u l t s9
l Rationalization of industrial footprint– Geographica l reorganizat ion
Gross marginOngo ing actions (2)
EuropeEuropeUnitedUnited StatesStates
(3)(3)Barcelona ( L ight ing)Jablonec ( W i r i n g)Bietigheim transfer ( W i p e r s )
31/12/2001143 sites
31/03/2003132 sites
03/2001170 sites
31/12/2002140 sites
Fort Worth( S w i t c h e s & D e t e c t i o nS y s t e m s )
(1)(1)
IndiaIndia
(4)(4) Wir ing
Q 1 - 2 0 0 3 R e s u l t s10
Gross marginOngo ing actions (3)
l Rationalization of industrial tool
l Increased supplier integration – Vo lume concentrat ion
- Q 1 -2001: 4,500 suppliers- Q 1 -2002: 3,500 suppliers- Q 1 -2003: 2,900 suppliers
– Valeo Integrated Partners- D e c e m b e r 2002: 80 V IPs- March 2003: 86 V IPs
Q 1 - 2 0 0 3 R e s u l t s11
Q 1-01 Q 2-01 Q 3-01 Q 4-01 Q 1-02 Q 2-02 Q 3-02 Q 4-02 Q 1-03
Operating income
*U n a u d i t e d q u a r t e r l y f i g u r e s
( i n % o f s a l e s )
2.02.0
3.83.8
4.54.5
+ 0.7 pt+ 0.7 pt
Q 1 - 2 0 0 3 R e s u l t s12
Operating income
Gross margin% s a l e s
R & D% s a l e s
S G & A% s a l e s
Operating income% s a l e s
Q1-2003 Q 1-2002 ∆
42216.5%
(154)6.0%
(170)6.7%
983.8%
+ 1.0 pt
- 1%
- 2%
+ 0.7 pt
4281 7 . 5 %
(152)6 . 2 %
(167)6 . 8 %
1094 . 5 %
(in mill ion e u r o )
Q 1 - 2 0 0 3 R e s u l t s13
P&L
• Operating income
• F inanc ia l expenses -net
• Other income and expenses - net• T a x e s
Ef fect ive ra te
• Net income before goodwill
• Net income
Q1-2003 Q 1-2002
98
(12)
(14)(25)
35.0%
46
20
109
(17)
(26)(21)
3 1 . 5 %
45
22
(in mill ion e u r o )
Cash generation
Q 1 - 2 0 0 3 R e s u l t s15
Cashflow 2002
Net debt down by 84 M euros to 564 M euros
• Net operational cash (before restructuring)– o/w change in operat ing work ing capital
• Ne t CAPEX
• Balance before restructur ing
• Restructuring
• Net cash f rom operat ing and invest ing act iv i t ies
+1 032+203
- 583
+449
-230
+ 219
Q 1 - 2 0 0 3 R e s u l t s16
Dividend per share
l Total yield> 5.5 %
l P a y out ratio61 %
2001 2002 proposal
Tax credit
Net 0.70
0.35
1.00
0.501.05
1.50
Div idends (82 M euros)Share cancel lat ion (51 M euros)
( in e u r o )
Q 1 - 2 0 0 3 R e s u l t s17
Shareholders’ equity / net debt
12/31/2002 03/31/2003
Shareholders' equity Net debt
2,101
564 563
2,070
Gear ing : 27%
(in million euro)
Gear ing : 27%
Q 1 - 2 0 0 3 R e s u l t s18
Provisions for reorganization expenses
12/31/2001 12/31/2002Utilizationsand reclassif ications
Written back Currenc ies
740
- 326
-9- 40
365
(in million euro)
Outlook
Q 1 - 2 0 0 3 R e s u l t s20
Return on assets
l Restored margins of maneuver
l Goal: Increasing return on assets
Profitability
Assets
Q 1 - 2 0 0 3 R e s u l t s21
Increasing profitability
Profitability
Assets
• Sales growth
• Cost base control
• Selective disposal program
• Optimal use of assets
• Investment control
Q 1 - 2 0 0 3 R e s u l t s22
Order intake
2001 2002 Q 1-2003
1.3Sales rat io
1.2
1.0
Q 1 - 2 0 0 3 R e s u l t s23
Expected increase in sales
l S u c c e s s achieved during range renewal– Discriminating factors
• compet i t i veness• quality• global capacity
l New products generated from R&D – Differentiating factor: technological offer
• Starter- alternators• Ultrasonic park assist system with slot measurement• Bending l ight system and bi- x enon l amps• Combined the rma l sys tems…
– Technology importer (Raytheon)
Q 1 - 2 0 0 3 R e s u l t s24
Awards
l A.T. Kea rney Award « Production Plant of the
Year »:
– « Best Ser ies Production » for the new wiper systems faci l i tyat Bietigheim ( Ge rmany ).
l « Ach i e vemen t Awa rd » f rom Toyo ta :
– Pro ject management for the supply of head lamps to the new Ya r i s.
l Two cert i f icates from Toyo ta :
– For quality recognition relating to the fog lamps and power outlets.
Q 1 - 2 0 0 3 R e s u l t s25
Expected increase in sales
l S u c c e s s achieved during range renewal– Discriminating factors
• compet i t i veness• quality• global capacity
l New products generated from R&D – Differentiating factor: technological offer
• Starter- alternators• Ultrasonic park assist system with slot measurement• Bending l ight system and bi- x enon l amps• Combined the rma l sys tems…
– Technology importer (Raytheon)
Q 1 - 2 0 0 3 R e s u l t s26
Business Wins
l Wiper Sys tems - GM (p ick-ups and S U V s - GMT
900)
– Turnaround at V E S I
– Techno log ica l edge : Flat B lades
l Renaul t Megane 2
– Highest Va leo content by car in the segment
Q 1 - 2 0 0 3 R e s u l t s27
Renault Megane 2
Motors Motors & & ActuatorsActuators
Electrical SystemsElectrical Systems
Wiper SystemsWiper Systems
Alternators and starters
Securi ty SystemsSecuri ty Systems
Electrical steering columnlock, hand free access
system
ABS Motors
Front Wiper System
Engine Cool ingEngine Cool ing
Front-end module,radiators, condensers
SwitchesSwitches & & Detection Detection SystemsSystems
Park assist system,
steering
angle sensor , top column
module, switches
Frpnt Lighting SystemsFrpnt Lighting Systems
Xenon and halogenhead lamps, fog lamps
Rear Lighting SystemsRear Lighting Systems
Rear lampsCentre high mounted stop lamps
TransmissionsTransmissions
Full clutch system
Climate Climate ControlControl
H V A C
Q 1 - 2 0 0 3 R e s u l t s28
Expected increase in sales
l S u c c e s s achieved during range renewal– Discriminating factors
• compet i t i veness• quality• global capacity
l New products generated from R&D – Differentiating factor: technological offer
• Starter- alternators• Ultrasonic park assist system with slot measurement• Bending l ight system and bi- x enon l amps• Combined the rma l sys tems…
– Technology importer (Raytheon)
Q 1 - 2 0 0 3 R e s u l t s29
Assets
Profitability
Assets
• Sales growth
• Cost base control
• Selective disposal program
• Optimal use of assets
• Investment control
Q 1 - 2 0 0 3 R e s u l t s30
Optimal use of assets
l Industrial efficiency– Standardizat ion– W C m a n a g e m e n t
l Asset turnover– 2001: 3.3– 2002: 3.8
l CAPEX contro l
– Stabilized at 6% of sales
Q 1 - 2 0 0 3 R e s u l t s31
2003 market prospects
l High inventory levels in United States
l Weak demand in Europe and North America
Fall in vo lumes
Q 1 - 2 0 0 3 R e s u l t s32
Valeo in 2003
l Significant order intake
l Sales in line with market
l Cont inu ing operating improvement
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