Valeo second-half earnings rise 16% on strong China, U.S. demand
PARIS (Bloomberg) -- French parts supplier Valeo said second-half earnings rose 16 percent as demand for cars increased in China and North America and the European vehicle market improved.
Earnings before interest, taxes and other expenses increased to 411 million euros ($563 million) from 355 million euros a year earlier, the Paris-based company said Thursday in a statement. Earnings beat the 375 million-euro average of three analyst estimates compiled by Bloomberg. Revenue rose 3 percent to 5.94 billion euros.
Valeo, whose products span windshield wipers, headlights and stop-start ignition systems, is focusing on technology that promotes safety, comfort and pollution reduction to increase profitability.
It matched a goal of a "slight increase" in 2013 earnings as a proportion of sales as surging demand from German and Asian customers boosted profits.
"Our strong cash generation and financial position will help us prepare for the expected sharp growth in sales, particularly in 2015 and 2016," CEO Jacques Aschenbroich said in the statement. "I am confident that our strategy focused on innovation and on developing our businesses in fast-growing production regions will enable us to continue delivering margin growth in line with our medium-term financial objectives."
Europe's car market, which is starting to revive from a six-year slump to a two-decade low in 2013, will increase 1 percent to 2 percent this year, Valeo predicted.
That compares with regional auto-industry growth forecasts for 2014 of 2 percent by car industry association ACEA and 1 percent by French carmaker Renault.
Valeo ranks No. 15 on the Automotive News Europe list of the top 100 global suppliers, with sales to automakers of $12.8 billion in 2012.Contact Automotive News