(Boursier.com) — Valeo corrected by 8% to 21.7 euros this Friday, after its financial publication, accompanied by a 2022 guidance deemed a little short. For 2021, the group announced a turnover increase of 5% to 17.26 MdsE, an Ebitda margin of 13.4% and a net profit CEO of 175 ME. In 2022, Valeo will focus on the integration of Valeo Siemens eAutomotive, the implementation of its efficiency program and the management of inflation. Valeo has set itself the objectives for 2022 of a turnover of 19.2 to 20 billion euros, an EBITDA of 11.8% to 12.3% of turnover, as well as an operating margin ranging from 3.2 to 3.7%. Free cash flow is expected to be around 320 ME.
These 2022 targets do not take into account the potentially unfavorable consequences on the economic environment of recent developments in the Russian-Ukrainian crisis, for example a drop in production volumes or a rise in energy or raw material prices above beyond known prices at the start of 2022.
Valeo is also launching its Move Up plan, “a value creation strategy based on the megatrends of sustainable mobility”, and aims to average annual outperformance of original equipment sales of more than 5 points over the 2021-2025 period, with a EBITDA margin of around 14.5% by 2025 and free cash flow generation between 800 million and one billion euros in 2025. Disposals of non-strategic assets for a value of around 500 million euros are planned over the duration of the plan, with “an optimized capital allocation” and a deleveraging of the group.
Valeo’s Move Up plan is part of a long-term vision of cleaner and safer mobility. Beyond 2025, “the electrical and ADAS markets will experience a wave of hyper-growth to reach 200 and 120 billion euros respectively in 2035”, anticipates the group. Thanks to the Move Up Plan, Valeo “will be ideally positioned to take advantage of this growth with cutting-edge technologies, robust financial performance and cash generation guaranteeing strong value creation, for the benefit of all Group stakeholders. including its shareholders”, provides the equipment manufacturer.
Valeo’s turnover should thus reach, in 2025, around 27.5 billion euros, including around 24 billion euros from its original equipment sales, anticipates the group.
In a context marked by high inflation in the cost of raw materials and energy, the group has set itself the objectives for 2025 of improving its EBITDA margin and its operating margin to reach approximately 14.5% respectively. and 6.5% of its 2025 revenue, compared to 13.4% and 4% of revenue recorded in 2021.
Valeo aims to generate free cash flow which will accelerate over the duration of the plan to reach between 800 million and one billion euros in 2025.
In the longer term, Valeo aims to reach more than 40 billion euros in sales by 2030. The group hopes to achieve its 500 million euros in non-strategic asset disposals by the end of 2023 depending on market conditions.