Faurecia Raises 2014 Target After First-Half Profit JumpsMathieu Rosemain
Faurecia SA, Europe’s largest maker of car interiors, raised its 2014 earnings forecast after first-half profit jumped 21 percent on strong demand in Asia and higher market share in its home region.
Operating income rose to 311 million euros ($418 million) from 256 million euros a year earlier, Nanterre, France-based Faurecia said in a statement today. That compares with the 314 million-euro average of four analyst estimates compiled by Bloomberg. Revenue increased 0.7 percent to 9.33 billion euros.
The French manufacturer forecast its full-year operating margin to widen by 30 basis points to 60 basis points, compared with the previous target of expansion of 20 basis points to 50 basis points. The margin in the first half rose to 3.3 percent of sales from 2.8 percent a year ago.
Faurecia, 52 percent owned by PSA Peugeot Citroen, is expanding in Asia and North America to lower its reliance on Europe, where industrywide car sales are gradually recovering from a two-decade low. The manufacturer outlined a target in November for operating profit to amount to 4.5 percent to 5 percent of sales by 2016, depending on the rate of auto production in its home region.
“Faurecia posted a solid sales growth during the first half of 2014, driven in particular by remarkable growth in Asia, where sales jumped more than 20 percent, as well as in Europe, where Faurecia’s growth has outpaced the rise in automotive production,” Chief Executive Officer Yann Delabriere said in the statement.
The shares rose as much as 4.7 percent to 28.90 euros and were up 4.3 percent at 9:20 a.m. in Paris trading. The stock has advanced 3.9 percent this year, valuing Faurecia at 5.57 billion euros.
The company stuck to its goal to increase 2014 sales by 2 percent to 4 percent at constant exchange rates. On that basis, first-half revenue rose 4 percent, the company said.