2021 guidance adjusted to reflect three main impacts
Nanterre (France), November 29, 2021
2021 GUIDANCE ADJUSTED TO REFLECT THREE
MAIN IMPACTS:
- NEW DOWNWARD REVISION OF
AUTOMOTIVE PRODUCTION IN EUROPE
- DIFFICULTIES TO FLEXIBILIZE
AND COMPENSATE STOP-AND-GO GENERATED COSTS
- ONE-OFF COSTS RELATED TO ONE
PROGRAM LAUNCH ISSUES IN THE US
Faurecia adjusts its 2021 guidance as
follows:
- Sales of between €15bn and
€15.5bn with confirmed strong organic sales outperformance of >
+600bps (vs. “sales of c. €15.5bn and strong organic sales
outperformance > +600bps” in the previous guidance released on
September 23).
- Operating margin
of c. 5.5% of sales (vs.
“operating margin between 6.0% to 6.2% of sales” in the previous
guidance released on September 23).
- Net cash flow
> €300m and net-debt-to-EBITDA ratio of
c. 1.6x at year-end (vs. “net cash flow of c. €500m and
net-debt-to-EBITDA ratio ≤ 1.5x at year-end” in the previous
guidance released on September 23).
This revised guidance is based on the latest IHS
Markit forecast dated November 2021 for worldwide automotive
production of c. 71 million vehicles in 2021 (as usually restated
by Faurecia, i.e. vehicles segment in line with CAAM for China). It
assumes no major lockdown impacting production or retail sales in
any automotive region during the end of the year and it is based on
2021 average currency rates of 1.20 for USD/€ and 7.73 for
CNY/€.
Sales
The latest forecast for automotive production in
Europe in H2, released in November by IHS Markit, posted a further
reduction by c. 1 million units or 13% vs. the forecast released in
September (from 7.8 million to 6.8 million vehicles).
Due to its geographic mix (highly weighted on
Europe, representing c. 45% of Group sales) and customer mix in the
region (the highest revisions impact Faurecia’s main customers in
the region), Faurecia now expects sales in the full year to reach
between €15 billion and €15.5 billion (vs. c. €15.5 billion in the
previous guidance).
Strong sales outperformance in the full year is
confirmed at more than 600bps (unchanged vs. the previous
guidance).
Operating income
On top of the impact of lower sales on operating
income, Faurecia is also facing operational challenges in the
launching phase of a greenfield Seating program in Michigan (USA).
These operational difficulties were already mentioned in Faurecia’s
announcement of its Q3 sales on October 26 and are mainly related
to the lack of qualified and stable workforce in this region. This
situation, which will be fixed before the end of the year, will
generate in Q4 disruptions and additional costs (mainly
subcontracting and non-quality costs) that will exceed what was
initially estimated.
Additionally, the continued stop-and-gos decided
by OEMs, even if gradually easing as from November, reduce cost
flexibilization capabilities, especially for Just-In-Time
deliveries.
Faurecia now expects operating margin of c. 5.5%
of sales (vs. 6.0% to 6.2% of sales in the previous guidance).
Net cash flow
The adjustment of net cash flow results from the
above-mentioned impacts on operating income, thus on EBITDA, but
also from working capital at year-end.
Working capital is impacted by the continued
stop-and-gos decided by OEMs that prevent an as efficient inventory
management as planned and by lower sales volumes in the last three
months that mechanically reduce cash collection from customers
before year-end.
Faurecia now expects net cash flow of more than
€300 million (vs. c. €500 million in the previous guidance) and
net-debt-to-EBITDA ratio of c. 1.6x at year-end (vs. ≤ 1.5x at
year-end in the previous guidance).
As regards 2022
Faurecia will release detailed FY2022 guidance
(stand-alone) on February 21, 2022, when it announces its FY2021
results; by this date, the Hella deal should be closed or near to
be closed.
A conference call for financial
analysts and media will be held today at
8:00am (Paris time).
Dial-in numbers:
- France:
+33 (0)1 70 73 27 27
- UK:
+44
(0) 203 009 5710
- USA:
+1 917 720 0178
No access code needed.
The conference call may also be followed at the following
link:
https://edge.media-server.com/mmc/p/8az8syo3
A replay will be available as soon as possible
after the call.
CalendarFebruary
21,
2022: FY
2021 results (before market
hours)
ContactsPressVictoria CHANIALEVP
Group CommunicationsTel: +33 (0)1 72 36 72
58victoria.chanial@faurecia.com |
|
|
|
|
Eric FOHLEN-WEILLCorporate communications
DirectorTel: +33 (0)1 72 36 72 58eric.fohlen-weill@faurecia.com
Analysts/InvestorsMarc MAILLETHead of Investor
RelationsTel: +33 (0)1 72 36 75 70marc.maillet@faurecia.com |
Matthieu
FERNANDEZDeputy Head of Investor RelationsTel: +33 (0)6 22 02 01
54matthieu.fernandez@faurecia.com |
|
About FaureciaFounded in 1997,
Faurecia has grown to become a major player in the global
automotive industry. With 266 industrial sites, 39 R&D centers
and 114,500 employees in 35 countries, Faurecia is a global leader
in its four areas of business: Seating, Interiors, Clarion
Electronics and Clean Mobility. Faurecia has focused its technology
strategy on providing solutions for the “Cockpit of the Future” and
“Sustainable Mobility”. In 2020, the Group posted sales of €14.7
billion. Faurecia is listed on the Euronext Paris stock exchange
and included in the CAC® Next 20 Index. For more information,
please visit www.faurecia.com
DISCLAIMER
This press release contains certain
forward-looking statements concerning Faurecia. Such
forward-looking statements represent trends or objectives and
cannot be construed as constituting forecasts regarding the future
Faurecia’s results or any other performance indicator. In some
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future operation, direction and success of Faurecia's business.
Although Faurecia believes its expectations are
based on reasonable assumptions, investors are cautioned that these
forward-looking statements are subject to numerous various risks,
whether known or unknown, and uncertainties and other factors, all
of which may be beyond the control of Faurecia and could cause
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filings made with the Autorité des Marchés Financiers (“AMF”),
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described in the section 2." Risk factors and management” of
Faurecia's 2020 Universal Registration Document filed by Faurecia
with the AMF on March 11th, 2021 under number D. 21-0112 (a version
of which is available on www.faurecia.com).
Subject to regulatory requirements, Faurecia
does not undertake to publicly update or revise any of these
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future events, or otherwise. Any information relating to past
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recommendation or as legal, tax, investment or accounting
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This press release does not constitute and
should not be construed as an offer to sell or a solicitation of an
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