JACQUES ASCHENBROICH CHAIRMAN & CEO JACQUES ASCHENBROICH - - PowerPoint PPT Presentation

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JACQUES ASCHENBROICH CHAIRMAN & CEO JACQUES ASCHENBROICH - - PowerPoint PPT Presentation

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FY 2018 RESULTS JACQUES ASCHENBROICH CHAIRMAN & CEO JACQUES ASCHENBROICH CHAIRMAN & CEO February 21, 2019 2018 RESULTS IN LINE WITH OCTOBER GUIDANCE THANKS TO COST SAVING PLAN 2018 RESULTS IN LINE WITH OCTOBER GUIDANCE THANKS TO

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SLIDE 1

FY 2018 RESULTS

JACQUES ASCHENBROICH – CHAIRMAN & CEO JACQUES ASCHENBROICH – CHAIRMAN & CEO

February 21, 2019

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SLIDE 2

2018 RESULTS IN LINE WITH OCTOBER GUIDANCE THANKS TO COST-SAVING PLAN 2018 RESULTS IN LINE WITH OCTOBER GUIDANCE THANKS TO COST SAVING PLAN

October 2018 guidance 2018 results S l th t t t h t 6% 6% Sales growth at constant exchange rates +6% +6% H2 OEM outperformance +2pts +3pts Operating margin (excl. JV & associates) 6.2% - 6.5% 6.3% JV & associates

  • 0.4% - -0.5%
  • 0.6%

Free cash flow €120m - €150m €161m

February 21, 2019 2

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SLIDE 3

SUCCESSFUL & ACCRETIVE INTEGRATIONS SUCCESSFUL & ACCRETIVE INTEGRATIONS

February 21, 2019 3

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SLIDE 4

2018 DIVIDEND OF €1.25/SHARE TO BE PROPOSED AT THE NEXT AGM 2018 DIVIDEND OF €1.25/SHARE TO BE PROPOSED AT THE NEXT AGM

1.25 1.25 1.25

Dividend (€/share)

0 5 0.57 0.73 1.0 0.4 0.47 0.5

2010 2011 2012 2013 2014 2015 2016 2017 2018

EPS (€/share) 1.62 1.89 1.68 1.90 2.41 3.11 3.91 3.69 2.30 EPS 1 62 1 89 1 85 2 17 2 54 3 52 3 98 4 33 2 52 EPS excl. non-recurring items (€/share) 1.62 1.89 1.85 2.17 2.54 3.52 3.98 4.33 2.52 Payout ratio 25% 25% 30% 30% 30% 32% 32% 34% 54%

February 21, 2019 4

2018 DIVIDEND OF €1.25/SHARE LEADING TO A PAYOUT RATIO OF 54%

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SLIDE 5

GEOPOLITICAL & MACRO ECONOMIC HEADWINDS GEOPOLITICAL & MACRO ECONOMIC HEADWINDS

RAW MATERIALS FOREIGN EXCHANGE GEOPOLITICS & EXPORT TRADE VOLATILITY VOLATILITY CONTROLS WAR

Dedicated mitigation plans Dedicated mitigation plans Iran-related activities shutdown Iran-related activities shutdown

5 February 21, 2019

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SLIDE 6

AUTOMOTIVE SECTOR IN (R)EVOLUTION AUTOMOTIVE SECTOR IN (R)EVOLUTION

IMPLEMENTATION SOFTWARE DECLINE IN CHINESE IMPLEMENTATION OF WLTP SOFTWARE AND AI IN CHINESE PRODUCTION NEWCOMERS

25% of our Valeo 25% of our Valeo Launch of a cost reduction plan in H2 2018 Launch of a cost reduction plan in H2 2018 ~25% of our Valeo engineers are now software engineers Creation of ~25% of our Valeo engineers are now software engineers Creation of New customers & new business models New customers & new business models

6 February 21, 2019

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SLIDE 7

AN INTEGRATED MODEL FULLY CENTERED ON THE 3 AUTOMOTIVE REVOLUTIONS AN INTEGRATED MODEL FULLY CENTERED ON THE 3 AUTOMOTIVE REVOLUTIONS

EXAMPLE OF EXAMPLE OF INTERIOR COCOON EXAMP E OF EXAMPLE OF SENSOR CLEANING SYSTEMS

February 21, 2019 7

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SLIDE 8

2019 OUTLOOK 2019 OUTLOOK

February 21, 2019

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SLIDE 9

STRICT CONTROL OF R&D, SG&A AND CAPEX STRICT CONTROL OF R&D, SG&A AND CAPEX

INCREASED STANDARDIZATION SOFTWARE MASSIVE SHIFT TO OFFSHORE EFFICIENCY PLANS (BY BUSINESS AND PRODUCT) SOFTWARE PLATFORMS ACCELERATION OF SHIFT TO LOW- NEAR-TERM IMPLEMENTATION CAPEX STRICT CONTROL COST COUNTRIES VARIABILIZATION OF COSTS OF VALEO PLANT OF THE FUTURE AUTOMATION CAPACITY REUSE AND MANAGEMENT OPERATIONS

February 21, 2019 9

OF COSTS AUTOMATION OPERATIONS

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SLIDE 10

A GRADUAL INCREASE IN LIKE-FOR-LIKE GROWTH AND MARKET OUTPERFORMANCE DURING THE YEAR OUTPERFORMANCE DURING THE YEAR

Examples of new products Arrival of new platforms in 2019 p p p

+85%

Content per car

Average content €x / % i hi l

Content per car for Valeo

leading to +x% vs previous vehicles

+€800m

Additional sales Additional sales in 2019

February 21, 2019 10

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SLIDE 11

2019 OUTLOOK 2019 OUTLOOK

In a context of:

l til l b l t ti d ti ( ti t d th f b t 0% d 1% th d ith 2018) ith

 volatile global automotive production (estimated growth of between 0% and -1% over the year compared with 2018) with

a decline in the first half due to the economic environment in China, and an improvement in the second half;

 uncertainty regarding the price of raw materials and electronic components.

The Valeo Group has set the following objectives:

 a stronger market outperformance than in second-half 2018, increasing gradually during the year thanks to the start of

production on new contracts, particularly in the camera, electrical and transmission systems, and lighting segments;

 roll-out of a new program to reduce costs by more than 100 million euros and capital expenditure by more than

100 million euros;

 EBITDA growth (in value terms);  higher free cash flow generation than in 2018;  operating margin excluding share in net earnings of equity-accounted companies (as a % of sales) of between 5.8% and

6.5%, depending on the trends in automotive production and in the price of raw materials and electronic components;

 a “share in net earnings of equity-accounted companies” line which as announced is expected to have a similar impact

February 21, 2019 11

 a share in net earnings of equity-accounted companies line which, as announced, is expected to have a similar impact

  • n Valeo’s 2019 statement of income as it did in 2018.
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SLIDE 12

GROWTH POTENTIAL CONFIRMED

2018 ORDER INTAKE AT 1.7X OEM SALES OR €28.6bn

  • €24.2bn OR 1.5X OEM SALES (EXCL. VALEO SIEMENS EAUTOMOTIVE), 10% CAGR SINCE 2013
  • €4.4bn AT VALEO SIEMENS EAUTOMOTIVE, A CUMULATIVE €10.5bn AT YEAR-END

February 21, 2019

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SLIDE 13

TOTAL ORDER INTAKE OF €28.6bn €24.2bn EXCLUDING VALEO SIEMENS EAUTOMOTIVE…

CONFIRMING VALEO’S FUTURE CAPACITY TO OUTPERFORM AUTOMOTIVE PRODUCTION …CONFIRMING VALEO S FUTURE CAPACITY TO OUTPERFORM AUTOMOTIVE PRODUCTION

Full-year order intake***

€bn

V l Si A i

6.1 4 4

Valeo Siemens eAutomotive

A cumulative €10.5bn order intake at year-end

33.7 28.6 4.4 8 9 9 4 9 6 8 8 11.9 14.1 15.1 14.8 17.5 20.1 23.6 27.6 24.2

CAGR**

7.1 8.9 9.4 9.6 8.8 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Valeo Siemens eAutomotive Valeo

CAGR +10%

1.7X* 1.9X* 1.6X* 1.6X* 1.6X* 1.4X*

Valeo Siemens eAutomotive Valeo

13 February 21, 2019

*Order intake / OEM sales ratio ** Reference 2013  2018 (excluding Valeo Siemens eAutomotive) *** See glossary page 83 excluding Access Mechanisms between 2005 & 2013 & Valeo Siemens eAutomotive

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SLIDE 14

ORDER INTAKE/OEM SALES RATIO AT 1.7X (INCL. VALEO SIEMENS EAUTOMOTIVE)

Order intake of €24.2bn

OEM sales of €16.5bn

ORDER INTAKE/OEM SALES RATIO AT 1.7X (INCL. VALEO SIEMENS EAUTOMOTIVE)

SA

SA

2%

Asia NA Asia

18%

14%

Order

2% Asia excl. China 19% China NA

  • excl. China

16% Asia 41%

€9.9bn

Asia 34%

€5.5bn €3.0bn

€3.4bn

Order intake/OEM sales ratio

Asia

Of which China

1.8x

2.4x

E 1 4 44%

32% China 15% Europe

China 25% Europe

€7.7bn

€10.5bn

46%

Europe 1.4x North America 1.1x South America 1.0x

Group 1.5x

44% with local Chinese OEMs

32% with local Chinese OEMs

% f 2018 d i t k *

% f 2018 OEM l *

43%

  • Incl. Valeo

Siemens 1.7x

February 21, 2019

% of 2018 order intake*

% of 2018 OEM sales*

14

*OEM sales and order intake by destination including joint ventures but excluding Valeo Siemens eAutomotive

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SLIDE 15

INNOVATION FUELING ORGANIC GROWTH INNOVATION FUELING ORGANIC GROWTH

24 2

€1b d i k AI i h d d

Valeo order intake 24.2

> €1bn order intake: AI-enriched surround view & automated parking systems with

  • bject and pedestrian detection features

Artificial Intelligence by Valeo

Valeo

€1bn order intake for robotaxis

53%*

Increasing order intake for cross-Business

2018 Innovation*

Increasing order intake for cross Business Group systems

15 February 21, 2019

*Products and technologies sold by less than 3 years excl. Valeo Siemens eAutomotive

OI CAGR 2013-2018: +10%

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SLIDE 16

Non- IFRS 15

Q4 2018 SALES

TOTAL SALES OF €4 8bn UP 1% AT CONSTANT EXCHANGE RATES

H2 2018 SALES

TOTAL SALES OF €4.8bn, UP 1% AT CONSTANT EXCHANGE RATES

DOWN 2% LIKE FOR LIKE

TOTAL SALES OF €9.3bn, UP 3% AT CONSTANT EXCHANGE RATES

DOWN 1% LIKE FOR LIKE

H2 2018 SALES

OEM SALES UP 2% AT CONSTANT EXCHANGE RATES

DOWN 2% LIKE FOR LIKE

AFTERMARKET SALES UP 7% AT CONSTANT EXCHANGE RATES AFTERMARKET SALES UP 7% AT CONSTANT EXCHANGE RATES

UP 2% LIKE FOR LIKE

February 21, 2019

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SLIDE 17

Q4 18 SALES UP 1% AT CONSTANT EXCHANGE RATES

DOWN 2% LIKE FOR LIKE

Non- IFRS 15 212

DOWN 2% LIKE FOR LIKE Q4 18

At constant exchange rates

+1% +1%

  • 1%
  • 1%

+3% +3% +37% +37% 487 212 4,135 4,834 €m

+0%

OEM Aftermarket Miscellaneous Sales

+1%

  • 2%
  • 3%

+2%

+1%

+23%

+28%

Reported

Like for like

Q4 17 4,134 Exchange rates +0.5% Scope +2.8%

February 21, 2019

Q4 17 4,785 Exchange rates +0.3% Scope +2.6% Q4 17 478 Exchange rates

  • 1.3%

Scope +2.0% Q4 17 173 Exchange rates

  • 14.5%

Scope +9.4%

17

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SLIDE 18

H2 18 SALES UP 3% AT CONSTANT EXCHANGE RATES

DOWN 1% LIKE FOR LIKE

Non- IFRS 15

DOWN 1% LIKE FOR LIKE H2 18

At constant exchange rates

+3% +3% +2% +2% +7% +7% +22% +22%

969 314 8,039 9,322 €m

+2% OEM Aftermarket Miscellaneous Sales +3%

  • 1%
  • 2%

+5%

+2%

+13%

+16%

Reported Like for like

H2 17 7,885 Exchange rates +0.2% Scope +4.1%

February 21, 2019

H2 17 9,086 Exchange rates +0.0% Scope +3.9% H2 17 924 Exchange rates

  • 1.8%

Scope +4.5% H2 17 277 Exchange rates

  • 8.9%

Scope +6.1%

18

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SLIDE 19

3-POINT OEM SALES OUTPERFORMANCE IN H2 (LIKE FOR LIKE)

Non- IFRS 15

3 POINT OEM SALES OUTPERFORMANCE IN H2 (LIKE FOR LIKE)

At constant exchange rates +6% +2%

  • 1%

Q4 & H2 18

OEM sales OEM sales €m 4 135 8,039 16,667 4,135 Q4 18 H2 18 2018 0%

Exchange rates +0 5%

+2%

Exchange rates +0 2%

+3%

Exchange rates

  • 2 1%

Reported

Exchange rates +0.5% Scope +2.8% Exchange rates +0.2% Scope +4.1% Exchange rates

  • 2.1%

Scope +5.2%

Outperformance +3pts +3pts +1.5pts

February 21, 2019 19

OEM sales growth

Like for like

  • 3%
  • 2%

+0%

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SLIDE 20

3-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15

H2 18

Like for like

44% of Valeo sales(2)

OEM sales(2)

W ld

3 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

OEM sales(2)

  • 2%

North America

OEM sales** +6%

P d ti *** 4%

Europe(1) North America

44% of Valeo sales 21% of Valeo sales(2)

OEM sales(2)

+6%

sales( )

  • 4%

World

Outperformance

+1pt vs IHS(3)

Outperformance

+3pts vs IHS(3) Production*** +4%

19% of Valeo sales(2)

OEM sales(2)

+4%

Outperformance

+4pts vs IHS(3) 1pt vs IHS 3pts vs IHS

Asia(1) excl. China South America

2% of Valeo sales(2)

+4%

OEM sales(2)

+8%

OEM

Outperformance

+4pts vs IHS(3)

14% of Valeo sales(2)

sales(2)

  • 16%

China

Outperformance

+11pts vs IHS(3) p

Outperformance

February 21, 2019

Outperformance

  • 3pts vs CPCA(3)

20 (1) Europe including Africa; Asia including Middle East (2) Valeo OEM sales by destination (3) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

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SLIDE 21

IN ASIA, 1-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15 Japan

26% of Asian sales(1)

OEM sales(1)

+11%

H2 18

Like for like

IN ASIA, 1 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

S th K

23% of Asian sales(1)

Asia

33% of total sales(1)

OEM sales(1)

  • 6%

OEM sales(1)

  • 3%

Outperformance +11pts vs IHS(2)

South Korea

41% of Asian sales(1)

OEM sales(1)

Outperformance

+1pt vs IHS(2) Outperformance

  • 7pts vs IHS(2)

4% of Asian sales(1)

China

OEM Sales(1)

+12%

sales

  • 16%

Outperformance

  • 3pts vs CPCA(2)

India

+12%

Outperformance +10pts vs IHS(2)

February 21, 2019 21 (1) Valeo OEM sales by destination (2) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

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SLIDE 22

H2 2018 SALES BY BUSINESS GROUP

Non- IFRS 15

H2 2018 SALES BY BUSINESS GROUP

CDA 19% VIS 29%

At constant exchange rates +2% +14%* +1%

  • 5%

PTS 26% THS 29% Group €9.3bn THS 26%

% of H2 18 sales

1,797 2,426 2,448 2,715 Total sales

In €m

Comfort & Driving Assistance Powertrain Thermal Visibility +3% +14%* +2%

  • 5%

Reported

Powertrain negatively impacted by: :

 WLTP in Europe  Customer mix in China  Manual transmission in Korea

Outperformance

OEM sales

+2% 3% 0% 6%

+7pts +2pts +5pts

  • 1pt

Visibility negatively impacted by :

 WLTP in Europe  Customer mix in China

+3% +14% +2% 5% Reported

February 21, 2019

* Including FTE automotive & Valeo-Kapec

22

Like for like

+2%

  • 3%

0%

  • 6%

 Delays in SOP

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SLIDE 23

Non- IFRS 15

TOTAL SALES OF €19 3bn UP 6% AT CONSTANT EXCHANGE RATES

2018 TOTAL SALES

TOTAL SALES OF €19.3bn, UP 6% AT CONSTANT EXCHANGE RATES

UP 1% LIKE FOR LIKE

OEM SALES UP 6% AT CONSTANT EXCHANGE RATES

UP 0% LIKE FOR LIKE, 1.5-POINT OUTPERFORMANCE

AFTERMARKET SALES UP 10% AT CONSTANT EXCHANGE RATES

UP 4% LIKE FOR LIKE

February 21, 2019

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SLIDE 24

2018 SALES UP 6% AT CONSTANT EXCHANGE RATES

UP 1% LIKE FOR LIKE

Non- IFRS 15 584

UP 1% LIKE FOR LIKE 2018

At constant exchange rates +6% +6% +6% +6% +10% +10% +14% +14% 2,010 584 16,667 19,261 €m

+3%

OEM Aftermarket Miscellaneous Sales

+4%

+1% +0%

+7%

+4%

+8%

+7%

Reported

Like for like

2017 16,120 Exchange rates

  • 2.1%

Scope +5.2%

February 21, 2019

2017 18,550 Exchange rates

  • 2.2%

Scope +5.1% 2017 1,887 Exchange rates

  • 3.3%

Scope +6.0% 2017 543 Exchange rates

  • 6.6%

Scope +7.2%

24

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SLIDE 25

1.5-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15

1.5 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

At constant exchange rates +6% +2% +9%

2018

8,039 8,628 16,667 OEM sales €m H1 18 H2 18 2018 +5%

Exchange rates

  • 4 3%

+2%

Exchange rates +0 2%

+3%

Exchange rates

  • 2 1%

Reported

Exchange rates

  • 4.3%

Scope +6.3% Exchange rates +0.2% Scope +4.1% Exchange rates

  • 2.1%

Scope +5.2%

+1pt +3pts Outperformance +1.5pts

February 21, 2019 25

+3%

  • 2%

+0% OEM sales growth

Like for like

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SLIDE 26

1.5-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15

2018

Like for like

46% of Valeo sales(2)

OEM sales(2)

World

1.5 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

OEM sales(2)

+0%

North America

OEM sales** +6%

P d ti *** 4%

Europe(1) North America

46% of Valeo sales 20% of Valeo sales(2)

OEM sales(2)

+2%

sales( )

+0%

World

Outperformance

+1pt vs IHS(3)

Outperformance

+1.5pts vs IHS(3) Production*** +4%

19% of Valeo sales(2)

OEM sales(2)

+6%

Outperformance

+3pts vs IHS(3) 1pt vs IHS

Asia(1) excl. China South America

2% of Valeo sales(2)

+6%

OEM sales(2)

+15%

OEM

Outperformance

+5pts vs IHS(3)

13% of Valeo sales(2)

sales(2)

  • 8%

China

Outperformance

+12pts vs IHS(3) p

Outperformance

February 21, 2019

Outperformance

  • 3pts vs CPCA(3)

26 (1) Europe including Africa; Asia including Middle East (2) Valeo OEM sales by destination (3) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

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SLIDE 27

IN ASIA, 1-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15 Japan

26% of Asian sales(1)

OEM sales(1)

+9%

2018

Like for like

IN ASIA, 1 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

S th K

23% of Asian sales(1)

Asia

32% of total sales(1)

OEM sales(1)

  • 1%

OEM sales(1)

  • 1%

Outperformance +9pts vs IHS(2)

South Korea

42% of Asian sales(1)

OEM sales(1)

Outperformance

+1pt vs IHS(2) Outperformance +1pt vs IHS(2)

4% of Asian sales(1)

China

42% of Asian sales

OEM Sales(1)

+21%

sales

  • 8%

Outperformance

  • 3pts vs CPCA(2)

India

+21%

Outperformance +14pts vs HIS(2)

February 21, 2019 27 (1) Valeo OEM sales by destination (2) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

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SLIDE 28

BALANCED GEOGRAPHIC POSITIONING

Non- IFRS 15

BALANCED GEOGRAPHIC POSITIONING

OEM sales by production region

% of OEM sales

Eastern Europe & Eastern Europe & Asia excl. China 19% Africa 15% Western Europe 31% Asia excl. China 15% p Africa 15% Western Europe 32%

57% in Asia & emerging 59% in Asia & i

US 10% Mexico 10% SA 2% China 13% 19% US 11% Mexico 10% SA China 15%

& emerging countries & emerging countries

2% 2%

February 21, 2019

2018 2017

28

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SLIDE 29

DIVERSE CUSTOMER PORTFOLIO

Non- IFRS 15

DIVERSE CUSTOMER PORTFOLIO

% of OEM sales

French* 13%

Other 6%

French* 14%

Other 6% American** 18%

13% German 29%

American** 19%

14% German 28%

Asian** 26%

Asian 34%

Asian** 26%

Asian 33%

2018 2017

February 21, 2019 * Including Opel ** Excluding Opel 29

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SLIDE 30

2018 SALES BY BUSINESS GROUP

Non- IFRS 15

2018 SALES BY BUSINESS GROUP

CDA 19% VIS 29%

At constant exchange rates +3% +20%* +3% 0%**

PTS 26% THS 29% Group €19.3bn THS 26%

% of 2018 sales

3,638 5,059 4,996 5,703 Total sales

In €m

Comfort & Driving Assistance Powertrain Thermal Visibility +1% +18%* +0%

  • 2%**

Reported

Powertrain negatively impacted by: :

 WLTP in Europe  Customer mix in China  Manual transmission in Korea

Outperformance

OEM sales

+4pts +1pt +2pts

  • 1pt

Visibility negatively impacted by :

 WLTP in Europe  Customer mix in China

February 21, 2019

* Including FTE automotive & Valeo-Kapec

30

** Including Ichikoh

OEM sales

Like for like

+3% 0% +1%

  • 2%

 Delays in SOP

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SLIDE 31

IFRS 15 IFRS 9

OPERATING MARGIN EXCL JV & ASSOCIATES

OF €1,203M OR 6.3% OF SALES

OPERATING MARGIN EXCL. JV & ASSOCIATES

OF €546M OR 2.9% OF SALES

NET INCOME

February 21, 2019

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SLIDE 32

GROSS MARGIN OF €3,674M OR 19.2% OF SALES

IFRS 15 IFRS 9

As a % of sales

  • 50bps

€1,894m

  • 12%

+20bps

  • 20bps

60bps

  • 30bps

€.3,832m €3 674m

  • 4%

20.9% 18.1%

+10bps

  • 80bps
  • 30bps
  • 60bps
  • 60bps
  • 10bps

€1,676m 20.7% 19.2%

20bps +0bps

  • 60bps

30bps

  • 50bps
  • 10bps

€3,674m

H2 17 Volume/ inflation Commodities & electronics Operational efficiency & plant disruption Quality costs Depreciation R&D sales Perimeter & exchange rates H2 18 2017 Volume/ inflation Commodities & electronics Operational efficiency Quality costs Depreciation R&D sales Perimeter & exchange rates 2018

E i f i d

+10bps +50bps +0bps

  • 30bps
  • 30bps
  • 10bps
  • 10bps

€1,938m €1,998m +3%

Execution of costs savings and capex reduction plan in line with guidance

20.5% 20.3%

H1 17 V l / C diti O ti l Q lit t D i ti R&D P i t & H1 18

NB: rounded figures

32 February 21, 2019

H1 17 Volume/ inflation Commodities & electronics Operational efficiency Quality costs Depreciation R&D sales Perimeter & exchange rates H1 18

slide-33
SLIDE 33

STRICT CONTROL OF R&D EXPENDITURE, AT 8.2% OF SALES

IN LINE WITH 2018 DESPITE CHALLENGING ENVIRONMENT IN H2

IFRS 15 IFRS 9

IN LINE WITH 2018 DESPITE CHALLENGING ENVIRONMENT IN H2

R&D expenditure In €m and as a % of sales

Peak of capitalization

1 494 1,560

Capitalized development expenditure

In €m and as a % of sales

577 716

impact in 2018

1,494 +4%

577 2017 2018 3.1% 3.7% 2017 2018 Amortization and impairment

  • f capitalized development expenditure (net of subsidies)

In €m and as a % of sales

8.1% 8.2% +10bps

262 308 1.4% 1.6%

2017 2018

2017 2018

33 February 21, 2019

slide-34
SLIDE 34

IFRS 15 IFRS 9

STRICT CONTROL OF SG&A EXPENSES AT 4.8% OF SALES,

STABLE DESPITE CHALLENGING ENVIRONMENT IN H2

SG&A

890 911 +2%

STABLE DESPITE CHALLENGING ENVIRONMENT IN H2

2018

2018

In €m and as a % of sales

890

Selling expenses

€303m*

Selling expenses

€316m*

Admin. Admin.

% Selling expenses 1.6%

  • f which 0.1%

Selling expenses 1.7%

  • f which 0.2%

4.8% 4.8% =

2017 2018

expenses €587m expenses €595m

  • f PPA
  • f PPA

4.8% H2 18

In €m & as a % of sales

442

  • r 4,8%

Admin. expenses 3.2% Admin. expenses 3.1%

  • 10bps

436 422*

  • 3%

2017 2018

34 February 21, 2019

* Including PPA (Purchase Price Allocation) - selling expenses of €20m in 2017 and of €39m in 2018 represented by customer relationships

H2 17 H2 18

*excl. scope impacts

slide-35
SLIDE 35

IFRS 15 IFRS 9

OPERATING MARGIN EXCL. JV & ASSOCIATES OF €1,203M OR 6.3% OF SALES

As a % of sales

,

€725m

  • 38%

€1,448m €1,203m

  • 17%

8.0% 4.8%

0bps

  • 280bps
  • 40bps

€448m 7.8% 6.3%

0bps

  • 150bps
  • 10bps*

€1,203m

H2 17 Gross margin R&D expenses SG&A H2 18 2017 Gross margin R&D expenses SG&A 2018 +20bps* 0bps

  • 20bps

€723m +4% €755m

E i f i d

7.7% 7.7%

Execution of costs savings and capex reduction plan in line with guidance

35 February 21, 2019

* Rounded figures

H1 17 Gross margin R&D expenses SG&A H1 18

slide-36
SLIDE 36

OPERATING MARGIN* OF €1,203M OR 6.3% OF SALES

IFRS 15 IFRS 9

OPERATING MARGIN OF €1,203M OR 6.3% OF SALES

H2 17 H2 18  2017 2018  H2 17 H2 18  2017 2018 

9,051 9,261 +2% Total sales (€m) 18,484 19,124 +4% 1,894

20.9%

1,676

18.1%

  • 12%
  • 280bps

Gross margin

As a % of sales

3,832

20.7%

3,674

19.2%

  • 4%
  • 150bps

(733) 8.1% (786) 8.5% +7%

  • 40bps

R&D expenditure As a % of sales (1,494) 8.1% (1,560) 8.2% +4%

  • 10bps

(436) 4.8% (442) 4.8%

  • 1%

= SG&A As a % of sales (890) 4.8% (911) 4.8% +2% =

725

8.0%

448

4.8%

  • 38%
  • 320bps

Operating margin excl. JV & Associates

As a % of sales

1,448

7.8%

1,203

6.3%

  • 17%
  • 150bps

(9)

(0.1)%

(83)

(0.9)%

na

  • 80bps

JV & Associates

As a % of sales

20 0.1% (111)** (0.6)% na

  • 70bps

716

7.9%

365

3.9%

  • 49%
  • 400bps

Operating margin incl. JV & Associates

As a % of sales

1,468

7.9%

1,092

5.7%

  • 26%
  • 220bps

**Of which:

  • Valeo Siemens eAutomotive = €(147)m

Chinese joint ventures = €33m

February 21, 2019 36

* Excluding joint ventures and associates

  • Chinese joint ventures = €33m
slide-37
SLIDE 37

NET INCOME OF €546M OR 2.9% OF SALES

IFRS 15 IFRS 9

NET INCOME OF €546M OR 2.9% OF SALES

H2 17 H2 18  2017 2018  H2 17 H2 18  2017 2018 

9,051 9,261 +2% Total sales (€m) 18,484 19,124 +4% 716

7.9%

365

3.9%

  • 49%
  • 400bps

Operating margin incl. JV & Associates

As a % of sales

1,468

7.9%

1,092

5.7%

  • 26%
  • 220bps

(43)

(0.5)%

(38)

(0.4)%

  • 12%

+10bps

Other income & expenses

As a % of sales

(66)

(0.4)%

(56)

(0.3)%

  • 15%

+10bps

673

7.4%

327

3.5%

  • 51%
  • 390bps

Operating income

As a % of sales

1,402

7.6%

1,036

5.4%

  • 26%
  • 220bps

(37) (22) (34) (7)

  • 8%
  • 68%

Cost of net debt Other financial income & expenses (75) (47) (66) (25)

  • 12%
  • 47%

614 286

  • 53%

Income before taxes 1,280 945

  • 26%

(195)

31 3%

(149)

40 4%

  • 24%

+9 1pts

Income taxes Eff ti t t (324)

25 7%

(303)

28 7%

  • 7%

+3pts 31.3%

(46)

40.4%

(44)

+9.1pts

  • 4%

Effective tax rate Non-controlling interests and other

25.7%

(79)

28.7%

(96)

+3pts

+22%

373

4.1%

93

1.0%

  • 75%
  • 310bps

Net income

As a % of sales

877

4.7%

546

2.9%

  • 38%
  • 180bps

February 21, 2019 37

slide-38
SLIDE 38

EXCLUDING NON-RECURRING ITEMS, EPS DOWN 42%

IFRS 15 IFRS 9

EXCLUDING NON RECURRING ITEMS, EPS DOWN 42%

2017 2018 Change Net income (€m) 877 546

  • 38%

EPS €3 7 €2 3 38% EPS €3.7 €2.3

  • 38%

Net income (€m) (excluding non-recurring items) 1,031 599

  • 42%

EPS (excluding non-recurring items) €4.3 €2.5

  • 42%

38 February 21, 2019

slide-39
SLIDE 39

ROCE AT 19% AND ROA AT 12%

IFRS 15 IFRS 9

ROCE AT 19% AND ROA AT 12%

2017 2018 Total sales 18,484 19,124 Operating margin* 1,468 1,092 ROCE 29% 19% ROA 19% 12%

* Including joint ventures and associates

39 February 21, 2019

slide-40
SLIDE 40

IFRS 15 IFRS 9

EBITDA OF €2,410M OR 12.6% OF SALES FREE CASH FLOW GENERATION OF €161M

February 21, 2019

slide-41
SLIDE 41

EBITDA OF €2,410M OR 12.6% OF SALES

IFRS 15 IFRS 9

EBITDA OF €2,410M OR 12.6% OF SALES

In €m and as a % of sales

2,431 2,410

H2 17* H2 18*

Business Groups

2017* 2018*

14.3 13.1 Comfort & Driving Assistance 14.2 14.0 13.3 12.3 Powertrain 13.0 13.1 12.1 9.3 Thermal 11.5 10.8 12 8 9 3 Visibility 12 9 11 1

13.2% 12.6% 2017 2018

12.8 9.3 Visibility 12.9 11.1 13.5 11.5 Group 13.2 12.6

*As a % of sales

2017 2018

41 February 21, 2019

slide-42
SLIDE 42

STRICT CONTROL OF CAPEX*

IFRS 15 IFRS 9

1,325 1,337

In €m and as a % of sales

1%

STRICT CONTROL OF CAPEX

2018

, ,

7 2% 20b

+1%

7.2% 7.0%

  • 20bps

2017 2018

2017 2018 2017 2018

* Excluding capitalized R&D

42 February 21, 2019

slide-43
SLIDE 43

FREE CASH FLOW GENERATION OF €161M

IFRS 15 IFRS 9

FREE CASH FLOW GENERATION OF €161M

H2 17 H2 18 2017 2018

1 218 1 069 EBITDA (€

)

2 431 2 410

at 12.6% of sales

1,218 1,069 EBITDA (€m) 2,431 2,410

66 228 Change in operating working capital 23 87 (28) (13) Restructuring & antitrust (105) (31) (166) (129) Other operating items (incl taxes) (326) (280) (166)

(115) (29)

(129)

(129) (34)

Other operating items (incl. taxes)

Of which: Taxes Pensions

(326)

(265) (27)

(280)

(267) (35)

1,090 1,155 Cash from operating activities* (€m) 2,023 2,186

+8% (911) (1,030) Capex (incl. capitalized R&D) outflow (1,745) (2,025)

179 125 Free cash flow* (€m) 278 161

15% 12% Cash conversion rate 11% 7% +16% Of which:

  • €324m in dividends

paid

  • €118m in share

buybacks

(2) (5) Interest (63) (58) (562) (169) Other financial items (1,007) (701)

(385) (49) Net cash flow (€m) (792) (598)

February 21, 2019

*excluding sale of trade receivables

43

1,842 2,248 Net debt (€m) 1,842 2,248

slide-44
SLIDE 44

STRONG BALANCE SHEET

February 21, 2019

slide-45
SLIDE 45

DEBT RATIOS

Shareholders’ equity and net debt

Net debt to EBITDA

2 559 1,842 2,431 2,291 2,559 2,248 2,410

1 842 4,388 2,291 4,522 2,248 4,571

G

1,842

Dec 31, 2017 June 30, 2018 Dec 31, 2018

Shareholders’ equity (€m) excluding non-controlling interests Net debt (€m)

Gearing 51%

Leverage

Dec 31, 2017 June 30, 2018 Dec 31, 2018

Leverage Leverage

Gearing 49% Gearing 42%

excluding non controlling interests

Leverage 0.76x g 0.90x Leverage 0.93x LT Outlook ST

Moody’s Baa2 Negative Prime-2

Net debt/EBITDA covenant of 3.25

Net debt (€m) 12-month rolling EBITDA (€m)

y g S&P BBB Stable A-2

February 21, 2019 45

slide-46
SLIDE 46

DEBT MATURITY PROFILE

3500 4000

DEBT MATURITY PROFILE

Maturity Outstanding amount Coupon Euro PP Nov 2019 €350m 0%

2500 3000

Undrawn credit lines 4.0 year maturity

Euro PP Nov 2019 €350m 0% Convertible bond June 2021 USD 575m 0% EMTN

  • Sept. 2022

€600m 0.375% EMTN January 2023 €500m 0.625%

1500 2000 2500

EMTN January 2024 €700m 3.25% EMTN EMTN June 2025 March 2026 €600m €600m 1.50% 1.625%

1000 1500

Cash & cash equivalents

Average maturity: 4.6 years Average maturity: 4.6 years

500

2018 2019 2020 2021 2022 2023 2024 2025 2026

cash & cash equivalents undrawn credit lines EMTN convertible bond Euro PP February 21, 2019 46

slide-47
SLIDE 47

MEDIUM TERM TARGET UPDATE MEDIUM-TERM TARGET UPDATE

February 21, 2019

slide-48
SLIDE 48

MEDIUM-TERM TARGET UPDATE MEDIUM TERM TARGET UPDATE

 Valeo’s growth model unchanged

In the long term In the long term

  • Relevant positioning of the Group and an array of state-of-the-art technologies in the areas of electric,

autonomous and connected vehicles;

  • A capacity for constant innovation grounded in the synergies between our 4 Business Groups
  • A capacity for constant innovation grounded in the synergies between our 4 Business Groups.

In 2019

  • Improvement in like-for-like growth and outperformance versus automotive production during the year

 MT target update

 The trends in the automotive market and in raw material prices in 2018 and the projections for 2019 lead us to revise the

ass mptions sed to determine o r medi m term o tlook as presented at o r In estor Da in Febr ar 2017 The assumptions used to determine our medium-term outlook, as presented at our Investor Day in February 2017. The Group will publish its new medium-term objectives during the Investor Day to be held before the end of the year.

February 21, 2019 48

slide-49
SLIDE 49

BACK-UP

IFRS 16 IFRS 15 & IFRS 9 Q4 2018 sales (non IFRS 15)

54 60 50

Q4 2018 sales (non IFRS 15) Q4, H2 & FY 2018 sales (IFRS 15) Business Group information

60 64 77

February 21, 2019

slide-50
SLIDE 50

IFRS 16 IMPACT

February 21, 2019

slide-51
SLIDE 51

IMPACTS OF IFRS 16 IMPACTS OF IFRS 16

February 21, 2019 51

slide-52
SLIDE 52

IMPACTS OF IFRS 16 IMPACTS OF IFRS 16

Impacts for the Group The Group is currently finalizing its assessment of the impact of applying IFRS 16 on its consolidated financial statements, based on the leases identified and an analysis of their main terms and conditions Valeo has lease contracts for land and buildings (production main terms and conditions. Valeo has lease contracts for land and buildings (production facilities, warehouses and offices) which are currently accounted for as operating leases and for which it will be required to recognize a right-of-use asset under IFRS 16. The main measures included in IFRS 16 to simplify application and adopted by the Group are:  exclusion of short-term leases;  exclusion of leases of low-value assets. The potential impact at the transition date on the 2019 consolidated financial statements, based on the budget and on the lease contracts in force at the transition date, are as follows: Item Nature of impact Scale Property, plant and equipment Increase 440 million euros – 480 million euros Lease liabilities/Net debt Increase 440 million euros – 480 illi million euros 2019 EBITDA(1) Improvement 0.4 to 0.5 percentage points 2019 financial income and expenses(1) Deterioration Additional financial expense

  • f around 20 million euros

2019 net income before taxes(1)

  • Minimal

(1) Estimated cumulative impact at end-December 2019 of contracts restated as part of the January 1, 2019 transition to IFRS 16, based on the 2019 budget.

Th b d t i di ti d th t l t diff ft th t iti The above data are indicative and the actual amounts may differ after the transition

  • ptions have been finalized and IFRS 16 has been adopted or due to the new leases that

may be signed during 2019. A reconciliation of future minimum lease payments on operating leases under IAS 17 with estimated lease liabilities that will be recognized by the Group under IFRS 16 is presented in Note 6.5. February 21, 2019 52

slide-53
SLIDE 53

IMPACTS OF IFRS 16 IMPACTS OF IFRS 16

Application by the Group Valeo will apply IFRS 16 using the modified retrospective approach. This simplified approach does not require restatement of financial statements published before the date IFRS 16 is first applied IFRS 16 is first applied. Within the scope of its transition to IFRS 16, the Group has elected the following main

  • ptions to simplify application:

 exclusion of leases with a residual term of 12 months or less at the transition date, along with leases of low-value assets;  application of IFRS 16 only to contracts previously identified as leases;  use of the initial lease term to determine the discount rate at the transition date;  exclusion of initial direct costs from the measurement of the right-of-use asset at the date of initial application. February 21, 2019 53

slide-54
SLIDE 54

IFRS 15 & IFRS 9

February 21, 2019

slide-55
SLIDE 55

IMPACTS OF THE APPLICATION OF IFRS 15 AND IFRS 9 ON 2017 COMPARATIVE INFORMATION ON 2017 COMPARATIVE INFORMATION

A press release covering the impacts of the application of IFRS 15 and IFRS 9 on 2017 comparative information was published on July 17, 2018. The press release is also available on Valeo’s website: https://www.valeo.com/fr/publications-presentations/ https://www.valeo.com/en/financial-publications-releases/

February 21, 2019 55

slide-56
SLIDE 56

IMPACTS OF THE APPLICATION OF IFRS 15 AND IFRS 9 IN 2018 IMPACTS OF THE APPLICATION OF IFRS 15 AND IFRS 9 IN 2018

The impacts of the application of IFRS 15 – “Revenue from Contracts with Customers” on 2018 sales are as follows:

  • the external cost of components imposed by customers, which was previously accounted for in original equipment sales, is now

presented as a deduction from “Raw materials consumed”. This reclassification results in a 521 million euro reduction in original equipment sales for 2018 (425 million euros for 2017) and mainly concerns the Thermal Systems Business Group’s front-end module

  • perations;
  • customer contributions to Research and Development (including prototypes), which were previously presented as a deduction from

“Research and Development expenditure”, are now presented in sales under “Miscellaneous”. This reclassification to sales represents an amount of 384 million euros for 2018 (359 million euros for 2017).

February 21, 2019 56

slide-57
SLIDE 57

2018 COMPARATIVE INFORMATION

SALES BY TYPE

IFRS 15 IFRS 9 IMPACT

SALES BY TYPE

2018* 2017 LFL change** Reported change 2018* 2017 LFL change** Reported change 2018* 2017 LFL change** Reported change Original equipment

4 135 4 134

  • 3%

0% 8 039 7 885

  • 2%

+2% 16 667 16 120 0% +3%

Aft k t

487 478 1% 2% 969 924 2% 5% 2 010 1 887 4% 7%

Second-half Full-year Before IFRS 15 (in millions of euros) Fourth-quarter Aftermarket

487 478 +1% +2% 969 924 +2% +5% 2 010 1 887 +4% +7%

Miscellaneous

212 173 +28% +23% 314 277 +16% +13% 584 543 +7% +8%

TOTAL

4 834 4 785

  • 2%

+1% 9 322 9 086

  • 1%

+3% 19 261 18 550 +1% +4% * 2018 data are presented in accordance with the same accounting principles as those used in the 2017 consolidated financial statements published in February 2018, i.e., before the application of IFRS 15 (unaudited data). ** Like for like (constant Group structure and exchange rates) (1).

2018 2017* LFL change** Reported change 2018 2017* LFL change** Reported change 2018 2017* LFL change** Reported change Original equipment

3 990 4 020

  • 4%
  • 1%

7 771 7 668

  • 3%

+1% 16 146 15 695 0% +3%

Aftermarket

487 478 +1% +2% 969 924 +2% +5% 2 010 1 887 +4% +7%

Under IFRS 15 (in millions of euros) Fourth-quarter Second-half Full-year Miscellaneous

350 284 +26% +23% 521 459 +15% +14% 968 902 +7% +7%

TOTAL

4 827 4 782

  • 2%

+1% 9 261 9 051

  • 2%

+2% 19 124 18 484 0% +4% * 2017 data differ from the data presented in the 2017 consolidated financial statements published in February 2018, since they have been adjusted to reflect the impact of applying IFRS 15. ** Like for like (constant Group structure and exchange rates) (1).

2018 2017 LFL change* Reported change 2018 2017 LFL change* Reported change 2018 2017 LFL change* Reported change Original equipment

  • 145
  • 114
  • 1 pt
  • 1 pt
  • 268
  • 217
  • 1 pt
  • 1 pt
  • 521
  • 425

0 pts 0 pts

Aftermarket

0 pts 0 pts 0 pts 0 pts 0 pts 0 pts

Impact of IFRS 15 (in millions of euros) Fourth-quarter Second-half Full-year

February 21, 2019 57

Miscellaneous

138 111

  • 2 pts

0 pts 207 182

  • 1 pt

+1 pt 384 359 0 pts

  • 1 pt

TOTAL

  • 7
  • 3

0 pts 0 pts

  • 61
  • 35
  • 1 pt
  • 1 pt
  • 137
  • 66
  • 1 pt

0 pts * Like for like (constant Group structure and exchange rates) (1).

slide-58
SLIDE 58

2018 COMPARATIVE INFORMATION

ORIGINAL EQUIPMENT SALES BY REGION

IFRS 15 IFRS 9 IMPACT

ORIGINAL EQUIPMENT SALES BY REGION

2018* 2017 LFL change** 2018* 2017 LFL change** 2018* 2017 LFL change** Europe & Africa

1 830 1 904

  • 5%

3 550 3 630

  • 4%

7 702 7 550 0% 1 367 1 384

  • 8%

2 651 2 584

  • 6%

5 313 4 965

  • 1%

  • f which China

571 702

  • 21%

1 086 1 259

  • 16%

2 224 2 371

  • 8%

Fourth-quarter Second-half Full-year Before IFRS 15 (in millions of euros) Asia, Middle East & Oceania 

  • f which China

571 702

  • 21%

1 086 1 259

  • 16%

2 224 2 371

  • 8%

 excluding China

796 682 +6% 1 565 1 325 +4% 3 089 2 594 +6%

North America

855 751 +8% 1 660 1 483 +6% 3 275 3 235 +2%

South America

83 95

  • 5%

178 188 +8% 377 370 +15%

TOTAL

4 135 4 134

  • 3%

8 039 7 885

  • 2%

16 667 16 120 0% * 2018 data are presented in accordance with the same accounting principles as those used in the 2017 consolidated financial statements published in February 2018, i.e., before the application of IFRS 15 (unaudited data). ** Like for like (constant Group structure and exchange rates) (1)

2018 2017* LFL change** 2018 2017* LFL change** 2018 2017* LFL change** Europe & Africa

1 819 1 898

  • 5%

3 528 3 614

  • 4%

7 660 7 514 0% 1 317 1 344

  • 9%

2 563 2 511

  • 7%

5 146 4 849

  • 2%

  • f which China

537 668

  • 22%

1 025 1 194

  • 17%

2 101 2 268

  • 10%

Fourth-quarter Second-half Full-year

Like for like (constant Group structure and exchange rates) ( ).

Under IFRS 15 (in millions of euros) Asia, Middle East & Oceania  excluding China

780 676 +4% 1 538 1 317 +2% 3 045 2 581 +4%

North America

771 683 +7% 1 502 1 355 +5% 2 964 2 962 +1%

South America

83 95

  • 6%

178 188 +7% 376 370 +15%

TOTAL

3 990 4 020

  • 4%

7 771 7 668

  • 3%

16 146 15 695 0% * 2017 data differ from the data presented in the 2017 consolidated financial statements published in February 2018, since they have been adjusted to reflect the impact of applying IFRS 15. ** Like for like (constant Group structure and exchange rates) (1).

2018 2017 LFL change* 2018 2017 LFL change* 2018 2017 LFL change* Europe & Africa

  • 11
  • 6

0 pts

  • 22
  • 16

0 pts

  • 42
  • 36

0 pts

  • 50
  • 40
  • 1 pt
  • 88
  • 73
  • 1 pt
  • 167
  • 116
  • 1 pt

  • f which China
  • 34
  • 34
  • 1 pt
  • 61
  • 65
  • 1 pt
  • 123
  • 103
  • 2 pts

l di Chi

16 6 2 t 27 8 2 t 44 13 2 t

Full-year Asia, Middle East & Oceania Fourth-quarter Second-half Impact of IFRS 15 (in millions of euros)

February 21, 2019 58

 excluding China

  • 16
  • 6
  • 2 pts
  • 27
  • 8
  • 2 pts
  • 44
  • 13
  • 2 pts

North America

  • 84
  • 68
  • 1 pt
  • 158
  • 128
  • 1 pt
  • 311
  • 273
  • 1 pt

South America

  • 1 pt

+1 pt

  • 1

0 pts

TOTAL

  • 145
  • 114
  • 1 pt
  • 268
  • 217
  • 1 pt
  • 521
  • 425

0 pts

* Like for like (constant Group structure and exchange rates) (1).

slide-59
SLIDE 59

2018 COMPARATIVE INFORMATION

SALES BY BUSINESS GROUP (INCLUDING INTERSEGMENT SALES)

IFRS 15 IFRS 9 IMPACT

SALES BY BUSINESS GROUP (INCLUDING INTERSEGMENT SALES)

2018* 2017 Change in sales Change in OE sales** 2018* 2017 Change in sales Change in OE sales** 2018* 2017 Change in sales Change in OE sales** Comfort & Driving Assistance Systems 917 894 +3% +2% 1 797 1 753 +3% +2% 3 638 3 590 +1% +3% Powertrain Systems 1 247 1 174 +6%

  • 5%

2 426 2 137 +14%

  • 3%

5 059 4 300 +18% 0% Before IFRS 15 (in millions of euros) Fourth-quarter Second-half Full-year Powertrain Systems 1 247 1 174 6% 5% 2 426 2 137 14% 3% 5 059 4 300 18% 0% Thermal Systems 1 268 1 252 +1%

  • 2%

2 448 2 409 +2% 0% 4 996 5 003 0% +1% Visibility Systems 1 433 1 500

  • 5%
  • 7%

2 715 2 855

  • 5%
  • 6%

5 703 5 808

  • 2%
  • 2%

GROUP 4 834 4 785 +1%

  • 3%

9 322 9 086 +3%

  • 2%

19 261 18 550 +4% 0%

* 2018 data are presented in accordance with the same accounting principles as those used in the 2017 consolidated financial statements published in February 2018, i.e., before the application of IFRS 15 (unaudited data). ** Like for like (constant Group structure and exchange rates) (1).

2018 2017* Change in sales Change in OE sales** 2018 2017* Change in sales Change in OE sales** 2018 2017* Change in sales Change in OE sales** Comfort & Driving Assistance Systems 962 932 +3% +2% 1 867 1 810 +3% +2% 3 766 3 699 +2% +3% Powertrain Systems 1 287 1 193 +8%

  • 5%

2 477 2 166 +14%

  • 3%

5 141 4 354 +18% 0% Under IFRS 15 (in millions of euros) Fourth-quarter Second-half Full-year Thermal Systems 1 152 1 166

  • 1%
  • 5%

2 228 2 236 0%

  • 3%

4 569 4 661

  • 2%
  • 1%

Visibility Systems 1 457 1 526

  • 5%
  • 7%

2 753 2 907

  • 5%
  • 6%

5 783 5 921

  • 2%
  • 2%

GROUP 4 827 4 782 +1%

  • 4%

9 261 9 051 +2%

  • 3%

19 124 18 484 +4% 0%

* 2017 data differ from the data presented in the 2017 consolidated financial statements published in February 2018, since they have been adjusted to reflect the impact of applying IFRS 15. ** Like for like (constant Group structure and exchange rates) (1).

2018 2017 Change in sales Change in OE sales* 2018 2017 Change in sales Change in OE sales* 2018 2017 Change in sales Change in OE sales* Comfort & Driving Assistance Systems 45 38 0 pts 0 pts 70 57 0 pts 0 pts 128 109 +1 pt 0 pts Powertrain Systems 40 19 +2 pts 0 pts 51 29 0 pts 0 pts 82 54 0 pts 0 pts Thermal Systems

  • 116
  • 86
  • 2 pts
  • 3 pts
  • 220
  • 173
  • 3 pts
  • 3 pts
  • 427
  • 342
  • 2 pts
  • 2 pts

Impact of IFRS 15 (in millions of euros) Fourth-quarter Second-half Full-year

February 21, 2019 59

Visibility Systems 24 26 0 pts 0 pts 38 52 0 pts 0 pts 80 113 0 pts 0 pts GROUP

  • 7
  • 3

0 pts

  • 1 pt
  • 61
  • 35
  • 1 pt
  • 1 pt
  • 137
  • 66

0 pts 0 pts * Like for like (constant Group structure and exchange rates) (1).

slide-60
SLIDE 60

Q4 SALES (NON IFRS 15)

February 21, 2019

slide-61
SLIDE 61

3-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15

Q4 18

Like for like

44% of Valeo sales(2)

OEM sales(2)

W ld

3 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

OEM sales(2)

  • 3%

North America

OEM sales** +6%

P d ti *** 4%

Europe(1) North America

44% of Valeo sales 21% of Valeo sales(2)

OEM sales(2)

+8%

sales( )

  • 5%

World

Outperformance

  • 1pt vs IHS(3)

Outperformance)

+3pts vs IHS(3) Production*** +4%

19% of Valeo sales(2)

OEM sales(2)

+6%

Outperformance

+6pts vs IHS(3) 1pt vs IHS 3pts vs IHS

Asia(1) excl. China South America

2% of Valeo sales(2)

+6%

OEM sales(2)

  • 5%

OEM

Outperformance

+4pts vs IHS(3)

14% of Valeo sales(2)

sales(2)

  • 21%

China

Outperformance

+4pts vs IHS(3) p

Outperformance

February 21, 2019

Outperformance

  • 4pts vs CPCA(3)

61 (1) Europe including Africa; Asia including Middle East (2) Valeo OEM sales by destination (3) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-62
SLIDE 62

IN ASIA, 0-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

Non- IFRS 15 Japan

26% of Asian sales(1)

OEM sales(1)

+14%

Q4 18

Like for like

IN ASIA, 0 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

S th K

23% of Asian sales(1)

Asia

33% of total sales(1)

OEM sales(1)

  • 8%

OEM sales(1)

0%

Outperformance +11pts vs IHS(2)

South Korea

42% of Asian sales(1)

OEM sales(1)

Outperformance

0pts vs IHS(2) Outperformance

  • 20pts vs IHS(2)

3% of Asian sales(1)

China

42% of Asian sales

OEM Sales(1)

  • 7%

sales

  • 21%

Outperformance

  • 4pts vs CPCA (2)

India

7%

Outperformance

  • 3pts vs IHS(2)

February 21, 2019 62 (1) Valeo OEM sales by destination (2) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-63
SLIDE 63

Q4 2018 SALES BY BUSINESS GROUP

Non- IFRS 15

Q4 2018 SALES BY BUSINESS GROUP

CDA 19% VIS 29%

At constant exchange rates

+2% +7%* +1%

  • 5%

PTS 26% THS 29% Group €4.8bn THS 26%

% of Q4 2018 sales

917 1,247 1,268 1,433

Total sales

In €m Comfort & Driving Assistance Powertrain Thermal Visibility

+3% +6%* +1%

  • 5%

Reported

+2%

  • 5%
  • 2%
  • 7%

8 t 1 t 4 t 1 t

+3% +6% +1% 5% Reported OEM sales

Like for like

O t f

February 21, 2019

* Including FTE automotive & Valeo-Kapec

63

+8pts +1pt +4pts

  • 1pt

Outperformance

slide-64
SLIDE 64

Q4, H2 & FY 2018 SALES (IFRS 15)

February 21, 2019

slide-65
SLIDE 65

Q4 2018 SALES UP 1% AT CONSTANT EXCHANGE RATES

DOWN 2% LIKE FOR LIKE

IFRS 15

DOWN 2% LIKE FOR LIKE Q4 18

At constant exchange rates

+1% +1%

  • 1%
  • 1%

+3% +3% +23% +23%

487 350 3,990 4,827 €m

  • 1%

OEM Aftermarket Miscellaneous Sales +1%

  • 2%
  • 4%

+2%

+1%

+23%

+26%

Reported Like for like

Exchange rates +0.5% Scope +3.0%

February 21, 2019

Exchange rates +0.3% Scope +2.5% Exchange rates

  • 1.3%

Scope +2.0% Exchange rates +0.1% Scope

  • 3.0%

65

slide-66
SLIDE 66

1-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE )

IFRS 15

Q4 18

Like for like

46% of Valeo sales(2)

OEM sales(2)

W ld

( )

OEM sales(2)

  • 4%

North America

OEM sales** +6%

P d ti *** 4%

Europe(1) North America

46% of Valeo sales 19% of Valeo sales(2)

OEM sales(2)

+7%

sales( )

  • 5%

World

Outperformance

  • 1pt vs IHS(3)

Outperformance

+2pts vs IHS(3) Production*** +4%

20% of Valeo sales(2)

OEM sales(2)

+4%

Outperformance

+5pts vs IHS(3) 1pt vs IHS 2pts vs IHS

Asia(1) excl. China South America

2% of Valeo sales(2)

+4%

OEM sales(2)

  • 6%

OEM

Outperformance

+2pts vs IHS(3)

13% of Valeo sales(2)

sales(2)

  • 22%

China

Outperformance

+4pts vs IHS(3) p

Outperformance

February 21, 2019

Outperformance

  • 5pts vs CPCA(3)

66 (1) Europe including Africa; Asia including Middle East (2) Valeo OEM sales by destination (3) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-67
SLIDE 67

IN ASIA, -1-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

IFRS 15 Japan

26% of Asian sales(1)

OEM sales(1)

+10%

Q4 18

Like for like

IN ASIA, 1 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

S th K

24% of Asian sales(1)

Asia

33% of total sales(1)

OEM sales(1)

  • 9%

OEM sales(1)

0%

Outperformance +7pts vs IHS(2)

South Korea

41% of Asian sales(1)

OEM sales(1)

Outperformance

  • 1pt vs IHS(2)

Outperformance

  • 20pts vs IHS(2)

3% of Asian sales(1)

China

OEM Sales(1)

  • 7%

sales

  • 22%

Outperformance

  • 5pts vs CPCA(2)

India

7%

Outperformance

  • 3pts vs IHS(2)

February 21, 2019 67 (1) Valeo OEM sales by destination (2) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-68
SLIDE 68

Q4 2018 SALES BY BUSINESS GROUP

IFRS 15

Q4 2018 SALES BY BUSINESS GROUP

At constant exchange rates

+3% +8%*

  • 2%
  • 5%**

CDA 20% VIS PTS 26% THS 30% Group €4.8bn

% of Q4 2018 sales

962 1,287 1,152 1,457

Total sales

In €m THS 24% Comfort & Driving Assistance Powertrain Thermal Visibility

+3% +8%*

  • 1%
  • 5%**

Reported p

OEM sales

Like for like

Outperformance

+2%

  • 5%
  • 5%
  • 7%

+8pts +1pt +1pt

  • 1pt

February 21, 2019

* Including FTE automotive & Valeo-Kapec

68

** Including Ichikoh

Outperformance

p p p p

slide-69
SLIDE 69

H2 2018 SALES UP 2% AT CONSTANT EXCHANGE RATES

DOWN 2% LIKE FOR LIKE

IFRS 15

DOWN 2% LIKE FOR LIKE H2 18

At constant exchange rates

+2% +2% +1% +1% +7% +7% +13% +13%

969 521 7 771 969 9,261 €m 7,771

+1% OEM Aftermarket Miscellaneous Sales +2%

  • 2%
  • 3%

+5%

+2%

+14%

+15%

Reported Like for like

Exchange rates +0.2% Scope +4.1%

February 21, 2019

Exchange rates 0.0% Scope +3.8% Exchange rates

  • 1.8%

Scope +4.5% Exchange rates +0.3% Scope

  • 1.9%

69

slide-70
SLIDE 70

2-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE )

IFRS 15

H2 18

Like for like

46% of Valeo sales(2)

OEM sales(2)

W ld

( )

OEM sales(2)

  • 3%

North America

OEM sales** +6%

P d ti *** 4%

Europe(1) North America

46% of Valeo sales 19% of Valeo sales(2)

OEM sales(2)

+5%

sales( )

  • 4%

World

Outperformance

+1pt vs IHS(3)

Outperformance

+2pts vs IHS(3) Production*** +4%

20% of Valeo sales(2)

OEM sales(2)

+2%

Outperformance

+3pts vs IHS(3) 1pt vs IHS 2pts vs IHS

Asia(1) excl. China South America

2% of Valeo sales(2)

+2%

OEM sales(2)

+7%

OEM

Outperformance

+2pts vs IHS(3)

13% of Valeo sales(2)

sales(2)

  • 17%

China

Outperformance

+10pts vs IHS(3) p

Outperformance

February 21, 2019

Outperformance

  • 4pts vs CPCA(3)

70 (1) Europe including Africa; Asia including Middle East (2) Valeo OEM sales by destination (3) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-71
SLIDE 71

IN ASIA, 0-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

IFRS 15 Japan

26% of Asian sales(1)

OEM sales(1)

+8%

H2 18

Like for like

IN ASIA, 0 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

S th K

24% of Asian sales(1)

Asia

33% of total sales(1)

OEM sales(1)

  • 7%

OEM sales(1)

  • 3%

Outperformance +8pts vs IHS(2)

South Korea

40% of Asian sales(1)

OEM sales(1)

Outperformance

0pts vs IHS(2) Outperformance

  • 7pts vs IHS(2)

4% of Asian sales(1)

China

OEM Sales(1)

+13%

sales

  • 17%

Outperformance

  • 4pts vs CPCA(2)

India

+13%

Outperformance +11pts vs IHS(2)

February 21, 2019 71 (1) Valeo OEM sales by destination (2) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-72
SLIDE 72

H2 2018 SALES BY BUSINESS GROUP

IFRS 15

H2 2018 SALES BY BUSINESS GROUP

At constant exchange rates

+3% +15%*

  • 1%
  • 5%

CDA 20% VIS PTS 27% THS 30% Group €9.3bn

% of H2 2018 sales

1,867 2,477 2,228 2,753

Total sales

In €m THS 24% Comfort & Driving Assistance Powertrain Thermal Visibility

+3% +14%* 0%

  • 5%

Reported

OEM sales

Like for like

Outperformance

+2%

  • 3%
  • 3%
  • 6%

+7pts +2pts +2pts

  • 1pt

p

February 21, 2019

* Including FTE automotive & Valeo-Kapec

72

slide-73
SLIDE 73

2018 SALES UP 6% AT CONSTANT EXCHANGE RATES

0% LIKE FOR LIKE

IFRS 15

0% LIKE FOR LIKE 2018

At constant exchange rates

+6% +6% +5% +5% +10% +10% +9% +9%

2,010 968 16,146 19,124 €m

+3% OEM Aftermarket Miscellaneous Sales +4%

+0% +0%

+7%

+4%

+7%

+7%

Reported Like for like

Exchange rates

  • 2.0%

Scope +5.3%

February 21, 2019

Exchange rates

  • 2.1%

Scope +5.2% Exchange rates

  • 3.3%

Scope +6.0% Exchange rates

  • 1.7%

Scope +1.9%

73

slide-74
SLIDE 74

1-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

IFRS 15

2018

Like for like

48% of Valeo sales(2)

OEM sales(2)

World

1 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

OEM sales(2)

+0%

North America

OEM sales** +6%

P d ti *** 4%

Europe(1) North America

48% of Valeo sales 18% of Valeo sales(2)

OEM sales(2)

+1%

sales( )

+0%

World

Outperformance

+1pt vs IHS(3)

Outperformance

+1pt vs IHS(3) Production*** +4%

19% of Valeo sales(2)

OEM sales(2)

+4%

Outperformance

+2pts vs IHS(3) 1pt vs IHS

Asia(1) excl. China South America

2% of Valeo sales(2)

+4%

OEM sales(2)

+15%

OEM

Outperformance

+3pts vs IHS(3)

13% of Valeo sales(2)

sales(2)

  • 10%

China

Outperformance

+12pts vs IHS(3) p

Outperformance

February 21, 2019

Outperformance

  • 5pts vs CPCA(3)

74 (1) Europe including Africa; Asia including Middle East (2) Valeo OEM sales by destination (3) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-75
SLIDE 75

IN ASIA 0-POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

IFRS 15 Japan

26% of Asian sales(1)

OEM sales(1)

+7%

2018

Like for like

IN ASIA 0 POINT OEM SALES OUTPERFORMANCE (LIKE FOR LIKE)

S th K

24% of Asian sales(1)

Asia

32% of total sales(1)

OEM sales(1)

  • 2%

OEM sales(1)

  • 1%

Outperformance +7pts vs IHS(2)

South Korea

41% of Asian sales(1)

OEM sales(1)

Outperformance

0pts vs IHS(2) Outperformance +1pt vs IHS(2)

4% of Asian sales(1)

China

41% of Asian sales

OEM Sales(1)

+21%

sales

  • 10%

Outperformance

  • 5pts vs CPCA(2)

India

+21%

Outperformance +14pts vs IHS(2)

February 21, 2019 75 (1) Valeo OEM sales by destination (2) IHS estimates released on January 16, 2019 – In China, China Passenger Car Association (CPCA) estimates

slide-76
SLIDE 76

2018 SALES BY BUSINESS GROUP

IFRS 15

2018 SALES BY BUSINESS GROUP

At constant exchange rates

+3% +20%* +1% 0%**

CDA 19% VIS PTS 27% THS 30% Group €19.1bn

% of 2018 sales

3,766 5,141 4,569 5,783

Total sales

In €m THS 24% Comfort & Driving Assistance Powertrain Thermal Visibility

+2% +18%*

  • 2%
  • 2%**

Reported p

OEM sales

Like for like

Outperformance

+3% 0%

  • 1%
  • 2%

+4pts +1pt 0pts

  • 1pt

February 21, 2019

* Including FTE automotive & Valeo-Kapec

76

** Including Ichikoh

Outperformance

p p p p

slide-77
SLIDE 77

BUSINESS GROUP INFORMATION

February 21, 2019

slide-78
SLIDE 78

COMFORT & DRIVING ASSISTANCE

Non- IFRS 15

COMFORT & DRIVING ASSISTANCE

At constant exchange rates

+3% +2% +3%

2018 key figures:

  • Sales: €3.6bn (19% of Group sales)

Market share* and competitors: C f t & D i i A i t

1,841 3,638 1,797

Total sales (€m)

( )

  • EBITDA: 14.0% (22% of Group EBITDA)
  • 24,600 employees
  • 27 plants
  • 10 development centers
  • 8 research centers
  • Comfort & Driving Assistance:

Valeo no. 2

Continental + Valeo + Bosch ~ 74%*

  • Driving Assistance: Valeo no. 1

Valeo + Continental + Bosch ~ 47%*

H1 18 H2 18 2018

* 2017 Valeo estimate

+3% 0% +3% +1% Reported +2% +3%

OEM sales growth Like for like

Key growth drivers:

3 i i t d fi d ith t t d d i t iti +1% +7% +4%

Outperformance

3 main macro-economic trends confirmed with cars more autonomous, more connected and more intuitive

Supported by increasingly stringent regulatory and certification environment (Euro NCAP in Europe and NTHSA in the US)

Leading to further increase in take-up of existing innovative products (including cameras, displays, sensors, etc.)

Latest business developments:

Another record order intake with orders for active safety products representing 6 3x sales orders for camera viewing & systems representing over 1 9x sales

78 February 21, 2019

Another record order intake with orders for active safety products representing 6.3x sales, orders for camera viewing & systems representing over 1.9x sales

Safety activity order intake covering laser scanner, front camera and radar

slide-79
SLIDE 79

POWERTRAIN SYSTEMS

Non- IFRS 15

2,426

POWERTRAIN SYSTEMS

+26% +14% +20%

2018 key figures:

  • Sales: €5.0bn (26% of Group sales)

Market share* and competitors:

At constant exchange rates

2,633 5,059

,

Total sales (€m)

  • EBITDA: 13.1% (28% of Group EBITDA)
  • 24,400 employees
  • 55 plants
  • 13 development centers
  • 7 research centers
  • Electrical Systems: Valeo no. 1

Valeo + Denso + Bosch/ZMJ ~ 70%*

  • Transmission Systems: Valeo no. 2

Luk + Valeo + Exedy + ZF Sachs ~ 75%*

H1 18 H2 18 2018

* 2017 Valeo estimate

Reported +22% +14% +18% +3%

  • 4%
  • 1%

OEM sales growth Like for like

Key growth drivers: Objective of reducing CO2 emissions and fossil fuel consumption through 3 priorities for engines:

Cleaner engines

Gearbox automation +1% +1% 0%

Outperformance

Powertrain electrification and development of low (12V, 48V) and high voltage

Latest business developments:

Recovery in sales with Hyundai Group vs 2017- negative impact of WLTP in Europe

New contracts in active actuators for automatic transmissions in Europe and Asia

Si ifi t t t f Hi h V lt t h l t VS A

79 February 21, 2019

Significant contracts for High Voltage technology at VSeA

New orders for Istars and 48V obtained in Europe and Asia

New orders for Torque Converters (automatic transmissions) in Asia and North America, and for Dual mass flywheels in Europe and Asia

slide-80
SLIDE 80

THERMAL SYSTEMS

Non- IFRS 15

2 448

THERMAL SYSTEMS

+4% +1% +3%

2018 key figures:

  • Sales: €5.0bn (26% of Group sales)
  • EBITDA: 10 6% (20% of Group EBITDA)

Market share* and competitors:

At constant exchange rates

2,548 1,282 4,996 2,448

Total sales (€m)

EBITDA: 10.6% (20% of Group EBITDA)

  • 24,700 employees
  • 64 plants
  • 10 development centers
  • 3 research centers

Thermal Systems: Valeo no. 2

Denso + Valeo + Hanon + Mahle ~ 54%* H1 18 H2 18 2018

*2017 Valeo estimate

Reported

  • 2%

+2% 0% +3% 0% +1%

OEM sales growth Like for like

Key growth drivers:

Thermal solutions for Electrified vehicles +1% +5% +2%

Outperformance

Thermal solutions for Electrified vehicles

Innovative solutions to comply with new regulations on gas pollutants and fuel consumption

Latest business developments:

Several new contracts, especially in Q4, took THS order intake to a level comparable to 2017 full year record before application of IFRS 15

Almost all PGs achieved the desired level of order intake, with particular good result for TFE

Best order intake result with Renault Nissan but also strong achievement with PSA Daimler and VW Groups

80 February 21, 2019

Best order intake result with Renault-Nissan, but also strong achievement with PSA, Daimler and VW Groups

Strong yearly achievement for new orders for battery thermal management with French and German customers

slide-81
SLIDE 81

VISIBILITY SYSTEMS

Non- IFRS 15

2,715

VISIBILITY SYSTEMS

  • 5%

+6% 0%

2018 key figures:

  • Sales: €5.7bn (29% of Group sales)
  • EBITDA: 11.1% (27% of Group EBITDA)

Market share* and competitors:

  • Lighting Systems: Valeo no. 1

At constant exchange rate

2,988 1,495 5,703

H1 18 H2 18 2018

Total sales (€m)

EBITDA: 11.1% (27% of Group EBITDA)

  • 37,300 employees
  • 49 plants
  • 15 development centers
  • 5 research centers

g g y

Valeo + Koito + Magnetti Marelli ~ 58%*

  • Wiper Systems: Valeo no. 1

Valeo + Denso + Bosch ~ 67%*

H1 18 H2 18 2018

*2017 Valeo estimate

Reported +1%

  • 5%
  • 2%

+3% +1%

  • 6%
  • 1%
  • 2%
  • 1%

OEM sales growth Like for like Outperformance

Key growth drivers:

Increasing LED take rate in all segments with Toyota (Alphard, Avalon,Corolla), VW (Polo, T-Roc, Arteon), Audi A3,Q2 & A1, SEAT (Leon, Ibiza, Ateca, Arona & now Tarraco), Renault (Megane, Talisman) and Geely (Boyue)

Increasing LED content with ADB Matrix on DS 3 (D34), Mini F56 LCI, Ford Edge, Toyota Alphard & Corolla, …

Increasing content in Interior Lighting with Ambient Lighting on Volvo 40 & 60 clusters, Audi Q3, BMW G2X & PSA R8

Latest business developments:

Continuous order intake increase with LED platforms modules (PeopLED, Thin Lens) in North America (GM T1 Silverado and Nissan Titan) and with Matrix / Pixel in Europe (JLR, Renault) and China (VW Teramont, Geely)

LED transverse drivers awarded at VW Group

Growth with Interior Lighting business : Selective Zoning with Daimler on S-Class and RGB Ambient with Volvo

Valeo received significant award for sensor cleaning from traditional volume car maker

81 February 21, 2019

Valeo received significant award for sensor cleaning from traditional volume car maker

Valeo wipers positioned to provide production and assembly know how for roof top modules integrating various sensor functions and cleaning system. Strategy has been confirmed with first business award

OEMS becoming more interested in brushless motor concept for weight reduction

slide-82
SLIDE 82

SEGMENT INFORMATION

IFRS 15

SEGMENT INFORMATION

(€m) Comfort & Driving Assistance Systems Powertrain Systems Thermal Systems Visibility Systems Others Total Sales:

2018

  • segment (excluding Group)

3,741 5,036 4,517 5,699 131 19,124

  • intersegment (Group)

25 105 52 84 (266) EBITDA 528 674 495 642 71 2,410 Research & Development expenditure, net (556) (319) (285) (377) (23) (1,560) Investments in property, plant & equipment & intangible asset 582 458 454 538 21 2,053 Segment assets 2,683 3,495 2,526 2,838 141 11,683 (€m) Comfort & Driving Assistance Systems Powertrain Systems Thermal Systems Visibility Systems Others Total Sales:

  • segment (excluding Group)

3,576 4,272 4,973 5,563 100 18,484

2017

  • intersegment (Group)

25 80 50 96 (251) EBITDA 525 564 536 764 42 2,431 Research & Development expenditure, net (518) (272) (286) (395) (23) (1,494) Investments in property, plant & equipment & intangible asset 537 390 430 508 37 1,902 Segment assets 2,271 3,519 2,251 2,544 144 10,729 21 février 2019 82

slide-83
SLIDE 83

GLOSSARY GLOSSARY

1) Order intake corresponds to business awarded by automakers during the period (including joint ventures other than Valeo Siemens eAutomotive accounted for 1) Order intake corresponds to business awarded by automakers during the period (including joint ventures, other than Valeo Siemens eAutomotive, accounted for based on Valeo’s share in net equity) less any cancellations, based on Valeo’s best reasonable estimates in terms of volumes, selling prices and project lifespans. Unaudited indicator. 2) Like for like (or LFL): the currency impact is calculated by multiplying sales for the current period by the exchange rate for the previous period. The Group structure impact is calculated by (i) eliminating, for the current period, sales of companies acquired during the period, (ii) adding to the previous period full-year sales of companies acquired in the previous period, and (iii) eliminating, for the current period and for the comparable period, sales of companies sold during the current or comparable period comparable period. 3) Operating margin including share in net earnings of equity-accounted companies corresponds to operating income before other income and expenses. 4) Net attributable income excluding non-recurring items corresponds to net attributable income adjusted for “other income and expenses” net of tax and non- recurring income and expenses net of tax shown in operating margin including share in net earnings of equity-accounted companies. 5) ROCE, or return on capital employed, corresponds to operating margin (including share in net earnings of equity-accounted companies) divided by capital employed (including investments in equity-accounted companies), excluding goodwill. 6) ROA t t d t ti i di id d b it l l d (i l di i t t i it t d i ) i l di d ill 6) ROA, or return on assets, corresponds to operating income divided by capital employed (including investments in equity-accounted companies) including goodwill. 7) EBITDA corresponds to (i) operating margin before depreciation, amortization and impairment losses (included in the operating margin) and the impact of government subsidies and grants on non-current assets, and (ii) net dividends from equity-accounted companies. 8) Free cash flow corresponds to net cash from operating activities (excluding the change in non-recurring sales of receivables) after taking into account acquisitions and disposals of property, plant and equipment and intangible assets. 9) Net cash flow corresponds to free cash flow less (i) cash flows in respect of investing activities, relating to acquisitions and disposals of investments and to changes f ( ) f f f in certain items shown in non-current financial assets, (ii) cash flows in respect of financing activities, relating to dividends paid, treasury share purchases and sales, interest paid and received, and acquisitions of equity interests without a change in control, and (iii) changes in non-recurring sales of receivables. 10) Net debt comprises all long-term debt, liabilities associated with put options granted to holders of non-controlling interests, short-term debt and bank overdrafts, less loans and other long-term financial assets, cash and cash equivalents and the fair value of derivative instruments hedging the foreign currency and interest rate risks associated with these items.

83 February 21, 2019

slide-84
SLIDE 84

CONTACTS CONTACTS

Investor Relations

V l Valeo

43, rue Bayen F-75848 Paris Cedex 17 France France Thierry Lacorre E-mail: valeo corporateaccess mailbox@valeo com E-mail: valeo.corporateaccess.mailbox@valeo.com Website: www.valeo.com

84 February 21, 2019

slide-85
SLIDE 85

SHARE INFORMATION SHARE INFORMATION

Share Data

Bl b Ti k

  • Bloomberg Ticker
  • Reuters Ticker
  • ISIN Number
  • Shares outstanding as of December 31, 2018

FR FP VLOF.PA FR 0013176526 240,253,100

ADR Data

  • Ticker/trading symbol
  • CUSIP Number
  • Exchange

VLEEY 919134304 OTC g

  • Ratio (ADR: ord)
  • Depositary Bank
  • Contact at J.P. Morgan – ADR

broker relationship desk 1:2 J.P. Morgan Jim Reeves +1 212-622-2710

85 February 21, 2019

slide-86
SLIDE 86

SAFE HARBOR STATEMENT SAFE HARBOR STATEMENT

St t t t i d i thi d t hi h t hi t i l f t tit t “f d l ki t t t ” Th t t t i l d Statements contained in this document, which are not historical fact, constitute “forward-looking statements”. These statements include projections and estimates and their underlying assumptions, statements regarding projects, objectives, intentions and expectations with respect to future financial results, events, operations, services, product development and potential, and statements regarding future

  • performance. Even though Valeo’s Management feels that the forward-looking statements are reasonable as at the date of this document,

investors are put on notice that the forward-looking statements are subject to numerous factors, risks and uncertainties that are difficult to p g j , predict and generally beyond Valeo’s control, which could cause actual results and events to differ materially from those expressed or projected in the forward-looking statements. Such factors include, among others, the Company’s ability to generate cost savings or manufacturing efficiencies to offset or exceed contractually or competitively required price reductions. The risks and uncertainties to whichValeo is exposed mainly comprise the risks resulting from the investigations currently being carried out by the antitrust authorities as identified in the Registration Document risks which relate to being a supplier in the automotive industry and to the development of new identified in the Registration Document, risks which relate to being a supplier in the automotive industry and to the development of new products and risks due to certain global and regional economic conditions. Also included are environmental and industrial risks as well as risks and uncertainties described or identified in the public documents submitted by Valeo to the French financial markets authority (Autorité des marchés financiers – AMF), including those set out in the “Risk factors” section of the 2017 Registration Document registered with the AMF on March 29, 2018 (under number D.18-0208). The Company assumes no responsibility for any analyses issued by analysts and any other information prepared by third parties which may be used in this document. Valeo does not intend or assume any obligation to review or to confirm the estimates of analysts or to update any forward-looking statements to reflect events or circumstances which occur subsequent to the date of this document.

86 February 21, 2019

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