Valeo Management Services

Valeo: First Half 2006: Sales and Results Up

    Paris, France (ots/PRNewswire) - The Board of Directors, which met today, approved the summarized consolidated accounts for the first half 2006.

@@start.t1@@      In millions of euros(x)              1st half              Quarterly variation 2006
                                                 2006 2005(xx) Change  2nd quarter        1st
      Total operating revenues  5,309  4,991      +6.4%        2,655          2,654
      Gross margin                         835      804      +3.9%          420              415
                            % of sales  15.9%  16.3%    -0.4pt        16.0%          15.8%
      Operating income                  169      159      +6.3%          110                59
              % of total revenues    3.2%    3.2%      0.0pt         4.1%            2.2%
      Net income attributable
      to Company shareholders         94        72    +30.6%            71                23
              % of total revenues    1.8%    1.4%    +0.4pt         2.7%            0.9%
      Basic earnings per share
      (in euros)                          1.23    0.87    +41.4%         0.93            0.30@@end@@

    (x) Non audited

    (xx) This data has been restated as required by IFRS 5.

    The Group's half-yearly results show strong resilience in an environment (automotive production and raw materials) that deteriorated between the first and the second quarter. Valeo has recorded progress in the areas of productivity and order intake.

    First half 2006 Group results

    Valeo's total operating revenues stood at EUR5,309 million in the first half 2006, up by 6.4% versus the first half 2005. Excluding the impact of exchange rates (+2.1%) and changes in the consolidated reporting entity (+3.3%), total operating revenues increased by 1%, in line with the growth in the Group's reference automotive production.

    The gross margin for the half rose by 3.9% to EUR835 million (15.9% of sales), versus EUR804 million (16.3% of sales) for the first half 2005. The Group considers that the rise in raw material prices reduced the gross margin for the half by 0.6 points.

    Operating income amounted to EUR169 million (3.2% of total revenues) versus EUR159 million (3.2% of total revenues) for the corresponding period in 2005. Operating income includes a net expense of EUR32 million under "other income and expenses" versus an expense of EUR34 million in 2005.

    Income before tax for the half was EUR147 million versus EUR110 million in 2005. This includes a net debt cost of EUR31 million, up by EUR8 million versus the first half 2005, resulting from the acquisitions and share buyback program implemented in 2005. It also includes a capital gain of EUR20 million generated by the sale of the stake in Parrot.

    Income tax totaled EUR44 million versus EUR35 million for the first half 2005. The effective tax rate was 30% versus 33% for the first half 2005.

    The net income attributable to Valeo shareholders was EUR94 million for the first half 2006, versus EUR72 million for the first half 2005. Earnings per share totaled EUR1.23, up by 41.4%.

    The operating cash amounted to EUR93 million, versus EUR75 million for the first half 2005, up 24%.

    At 30 June 2006, Valeo's net debt stood at EUR1,053 million, versus EUR1,080 million at 31 December 2005. The debt-to-equity ratio was 60%, versus 63% at year-end 2005.

    The order intake for the half represents 1.2 times OEM sales, versus 1.0 times for the second half 2005 and 1.2 times at 30 June 2005.


    For the second half of the year, the Group forecasts stable production for light vehicles in Europe and a decrease of 2% in North America. Valeo will step up its management efforts to offset the negative effects of the rise in raw material prices on its profitability.

    The annual targets fixed at the start of the year (increased content per vehicle, improved return on capital employed, sustained level of free cash flow and rise in order intake) still stand.

    Valeo is an independent industrial Group fully focused on the design, production and sale of components, integrated systems and modules for cars and trucks. Valeo ranks among the world's top automotive suppliers and employs 72,900 people in 134 plants, 69 R&D centers and 9 distribution centers in 28 countries.

    For further information, please contact:

    Bruno Roland Bernard, Vice-President, Group Communications, Tel: +33-(0)1-40-55-20-65

    Rémy Dumoulin, Investor Relations Director, Tel: +33-(0)1-40-55-29-30

    For more information on the Group and its business sectors, please visit the website:

ots Originaltext: Valeo
Im Internet recherchierbar:

For further information, please contact: Bruno Roland Bernard,
Vice-President, Group Communications, Tel: +33-(0)1-40-55-20-65. Rémy
Dumoulin, Investor Relations Director, Tel: +33-(0)1-40-55-29-30

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