PARIS (Reuters) - French car parts maker Faurecia (EPED.PA) aims to increase earnings in four to five years after posting a 42 percent rise in 2019 sales on Monday.
French car parts maker Faurecia SA President and CEO Philippe Varin attends the company's 2017 annual results presentation in Paris, France, February 17, 2019. REUTERS/Philippe Wojazer
Faurecia’s 2019 organic sales rose 3.3 percent to 19.53 billion euros ($21.92 billion), meeting guidance issued by the car parts manufacturer last July.
That was almost as fast as revenue growth of 3.7 percent in 2018, powered by a 12.5 percent gain at Faurecia’s most profitable unit, France’s Leclerc.
Carmakers’ disposals of car-building assets - part of a restructuring announced by parent PSA (PEUP.PA) in late 2017 - are driving growth, the company said. Total sales from sales of non-core operations including the sale of the likes of its passenger car engine business and armada car seating operations jumped 32 percent to 2.81 billion euros.
Faurecia Chief Executive Philippe Varin said the company has full confidence that by 2020 organic growth will hit 4-5 percent. That would require continued robust demand for cars, but also approval for construction and municipal transport projects, he added.
He confirmed PSA’s 2020 target of achieving organic revenue growth of 6-7 percent and reiterated the carmaker’s 2020 annual sales target of 7.9 billion euros.
Full-year profit before interest and tax (EBIT) rose 42 percent to 748 million euros, aided by restructuring charges in the prior-year period.
Related Coverage 2018 revenue and EBIT rise at Faurecia as sales hit record
Faurecia kept its 2019 forecast for free cash flow of 500 million euros and forecast 5 percent operating profit growth. The company forecast 2020 revenue at between 22.5-23.5 billion euros and EBITDA of 1.2-1.3 billion euros.
The 2018 group income rose 8.7 percent on a reported basis to 907 million euros, excluding the impact of restructuring and one-off items.
Shares in Faurecia, which has a market value of 18.6 billion euros, were up 0.3 percent at 1027 GMT.