(BFM Bourse) – Faurecia has just completed a new delicate financial year, again in deficit, but evokes a “founding year”, marked by the takeover of the German group Hella. In addition to renaming itself Forvia, the automotive supplier now wants to be ambitious by 2025.
Born from the merger in 1998 of ÉCIA (for “equipment and components for the automotive industry”), a subsidiary of PSA, and the producer of automobile seats Bertrand Faure, Faurecia became independent at the beginning of last year via distribution, by Stellantis (group resulting from the merger between PSA and Fiat Chrysler) directly to its shareholders of its stake in the capital of its subsidiary.
“2021 has been an unprecedented year for Faurecia” comments its managing director Patrick Koller, quoted in the press release. “First, the successful distribution of shares held by PSA/Stellantis has significantly increased our free float [à plus de 90% aujourd’hui, contre moins de 50% auparavant, NDLR], expanded our international shareholding and improved share liquidity. Secondly, we launched the acquisition of a majority stake in Hella, a strategic and transformative investment which was successfully concluded in five months.
After announcing last August the launch of a takeover bid for the shares of the German family group (world leader in lighting), Faurecia has indeed indicated that it has finalized this operation on January 31 by acquiring more than 80% of the for 6.7 billion euros. A week later, on February 7, the tricolor equipment supplier revised upwards its forecast of cost synergies resulting from the takeover, indicated that this operation would give birth to the world’s No. 7 automotive supplier, and changed its name to “Forvia ” – contraction of “Forward”, a forward movement, and “Via”, a reference to the road and mobility. Before this operation, Faurecia was “only” the 22nd largest supplier in the world, in particular behind Michelin (13th), according to the annual ranking carried out by our colleagues from theNew Factory in November.
And Forvia is therefore unveiling its 2022 and medium-term objectives on Monday, after another thwarted year. The group indeed evokes “a resilient performance despite unfavorable circumstances”, the shortage of semiconductor materials having limited the rebound in global automotive production to +3.8% in 2021 (after -16% in 2020, at a low since 2010).
Faurecia’s latest annual results before its consolidation nevertheless come out in line with its targets lowered in November. More specifically, its revenues are higher than expected (at 15.6 billion against “between 15 and 15.5 billion announced) while its operating margin is 5.5%, in line with the objective adjusted to the decline – from 6 to 6.2% of sales in the previous “guidance”.
The rise in the cost of raw materials, in particular special steels and plastics, caused 400 million euros in additional costs, “passed on up to 80% to customers”, nevertheless specifies the financial director of the group Michel Favre, in a conference Press.
The forecasts provided by the group, on the other hand, only concern at this stage (and due to the recent finalization of the acquisition) only the scope of Faurecia at the end of 2021. And in the event of a resumption of automotive production which should reach 78.7 million vehicles in 2022 (i.e. +7.2% over one year), the equipment manufacturer is now seeing its revenues rebound to between 17.5 and 18 billion euros over the financial year in Classes. It also expects its operating margin to be between 6% and 7%, “with a second half close to pre-Covid levels”, when the shortage of semiconductors begins to ease, Faurecia hopes. These objectives will nevertheless be adjusted on April 28 to include the consolidation of Hella in Faurecia’s accounts over 11 months, i.e. from February 1, 2022.
On the strength of a “new year of solid order intake” (75 billion euros over the last three years), Forvia is also reiterating its ambitions for 2025 announced last August, namely “a 2025 turnover higher at 33 billion euros [dont 24,5 milliards pour Faurecia, NDLR] and an operating margin of more than 8.5% of turnover”.
On the stock market, the stock opened sharply higher by more than 3% before quickly erasing all of its initial gains, then plunging into negative territory. Shortly before 11 a.m., it dropped 2% to 38.84 euros, bringing its decline to 10% over the last 4 sessions.
Quentin Soubranne – ©2022 BFM Bourse
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