IMPROVED YEAR-ON-YEAR PERFORMANCE

CONFIRMED FY 2024 GUIDANCE WITH SALES AND OPERATING MARGIN NOW EXPECTED IN THE LOWER END OF THE RANGE 

CONFIRMED POWER25 DELEVERAGING TARGET

IMPROVED PERFORMANCE IN H1 2024 vs. H1 2023

• Organic sales growth of +2.7%

  In a market that was broadly flat (-0.2%).
  Outperformance of +290bps, 460bps, excl. unfavorable geographic mix impact. 

• Operating margin of 5.2%, up 20 basis points year-on-year, despite a 30 basis points one-off impact from Interiors North America
• Solid net cash flow of €201m, up 16.3% vs. H1 2023
• Active debt management contributed to extend maturity

CONFIRMED FY 2024 GUIDANCE WITH SALES AND OPERATING MARGIN NOW EXPECTED IN THE LOWER END OF THE RANGE 

Net cash flow ≥ 2023 in value and Net debt/Adjusted EBITDA ≤ 1.9x at year-end are confirmed. 

CONFIRMED POWER25 KEY TARGET OF NET DEBT/ADJUSTED EBITDA < 1.5x, SUPPORTED BY THE EXPECTED FINALIZATION OF THE SECOND DISPOSAL PROGRAM BY END-2025
 

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Patrick KOLLER, Chief Executive Officer of FORVIA, declared:

“In the first half of the year, the automotive environment was characterized by broadly flat automotive production year-on-year and a slowdown of the pace of electrification in Europe. The general environment continued to be impacted by persistently high interest rates and unfavorable currency rates. In this context, and despite unfavorable geographic and customer mix, FORVIA posted an organic sales growth of 2.7%, outperforming the market by 290 basis points.

Operating margin rose year-on-year in most Business Groups with the exception of Interiors operations in North America that were hit during the period by one-off extra-costs. The Group’s operating margin nevertheless grew by 20 basis points to 5.2% of sales.

Net cash flow of €201 million rose by 16% year-on-year, demonstrating efficiency of the Group’s “Manage by Cash” program.

The Group recorded a high order intake of €15 billion in the semester, of which 40% in Asia. It strengthened its footprint in Asia with the creation of new joint ventures with Chinese manufacturers, opening of a new plant in Thailand for BYD, and in the field of sustainable mobility.

In the second half of the year, FORVIA is poised to benefit from the turnaround of Interiors North American operations and, more structurally, from the continuing benefits from the synergies program developed with FORVIA HELLA, and the EU-FORWARD project that was presented in February and is now on track. The latest S&P forecast of 2024 automotive production down 2% year-on-year, leads to expect full-year 2024 sales and operating margin to be in the lower end of the range announced in February.

FORVIA remains strongly focused on its top priority to deleverage the company. Continuous progress in net cash flow generation is the main driver of this priority, strengthened by the second €1 billion disposal program, of which around 25% was already cashed in at the end of the past semester. The ongoing progress of the rest of the program gives us confidence that it will be finalized by the end of next year, thus securing our POWER25 key target to reach a Net debt/Adjusted EBITDA ratio below 1.5 times at the end of 2025. 

All the Group’s employees, whom I thank for their commitment, are fully mobilized to achieve this goal.”