Annual General Shareholders Meeting. May 30, 2017

Transcription

1 Annual General Shareholders Meeting May 30, 2017

2 Agenda Results Michel Favre 2 Outlook and Strategy Patrick Koller 3 Governance and compensation Jean-Pierre Clamadieu Linda Hasenfratz

3 2016 Results Michel Favre Chief Financial Officer

4 A strong performance exceeding guidance Robust value-added* sales growth + 4.3% (like for like**) Total sales up 2.6% (like for like**) Operating margin up 80 bp to 6.2% of value-added sales 5.2% of total sales Net cash flow at 459m up 52% Proposed dividend of 90 cents, up 38% versus previous year 4 * Value-added sales: Total sales less monoliths sales ** Constant currencies & scope

5 2016 performance exceeded commitments set in COMMITMENTS 2016 total* sales above 21 billion euros (CAGR ~5%) Operating margin 4.5% - 5.0% (total sales) Europe 4.5% 5.0% North America >4.0% Asia >8% Net cash flow around 300 million euros ROCE*** above 20% 2016 ACHIEVEMENTS 2016 total sales CAGR** 5.3% Operating margin 5.2% (total sales) Europe 4.6% North America 4.6% Asia 10.1% Net cash flow 459 million euros ROCE 24.6% * Including Exteriors which was sold in 2016; 5 ** CAGR excluding Exteriors; *** Pre-tax and including goodwill

6 IFRS 15 application Revenue recognition Value-added sales, best representation of Group activity, are defined as total sales less monolith sales Monolith sales: Faurecia has a "pass through" role (no role on specification, on system validation and has no economic interest) According to our studies, Faurecia should be qualified as an agent for monolith under IFRS 15 Revenue recognition: Monolith sales will be excluded from IFRS sales from January 1, This will have no impact on Seating or Interiors, only Clean Mobility will be adjusted From January , Faurecia will report value-added sales only, giving the reconciliation with total sales in appendix 6

7 Solid organic growth in 2016 Sales in m CAGR ** % Monoliths 16,877 3,102 18,770 18,711 3,304 3,097 Value-added sales 13, %* 15,466 15, IFRS * Constant currencies & scope; 7 ** Value-added sales

8 2016 operating margin sharply up Operating income in m CAGR % Operating margin on value-added sales improved 80 bp to 6.2% versus 2015 Higher sales contribution (gross margin +100 bp) reduced cost base % of VA sales 4.3% 5.4% 6.2% Accelerating investments in Faurecia 4.0 project Higher R&D expenses (+10 bp) 2014 IFRS

9 Achievements ALL BUSINESS GROUPS CONVERGED TO MARGIN LEVELS AT OR ABOVE 5.2% Seating Organic growth of 9.0%, twice the LV production growth Interiors Operating margin improvement of 250 bp between 2014 and 2016 Clean Mobility 9.4% operating margin (on value-added sales), at benchmark level ALL REGIONS PROGRESSED SIGNIFICANTLY (ON VALUE-ADDED SALES) Europe Operating margin 5.6%, +80 bp vs 2015, leveraging operational efficiency North America Operating margin 5.4%, +70 bp vs 2015, confirming operational efficiency Asia Maintained momentum with value-added sales up 9.1% (organic) and operating margin of 12.1%, +40 bp vs 2015 South America Very strong growth (+36% organic) and sharp loss reduction ( 19m in 2016) leveraging reduced cost base 9

10 Net income at 638m Net margin on continued operations 2.9% (on VA sales) In m Value-added sales 15, ,613.6 Operating income (margin as % of VA sales) (5.4%) (6.2%) Restructuring & other income and expenses Net interest expense & other income and interest expense Pretax income of integrated companies Corporate income taxes Net income of associates & other minority interests (65.3) (206.7) (185.7) (61.3) (105.8) (162.4) (189.2) (63.3) Net profit from discontinued operations Consolidated net income (Group share) Net income per share* (fully diluted) (in euros) * Continued operations

11 Net debt almost eliminated Net debt in m December 31, 2015 December 31, 2016 Significant cash generation of 459m (342) base de Successful coûts réduite refinancing plan completed (963) 11

12 Share price stable in 2016 Up by 28% in 2017 (YTD) % % 130 Faurecia SBF STOXX AUTO January 1, 2016 July 1, 2016 January 1, 2017 May 26,

13 Faurecia S.A. financial statements millions Total sales Operating margin Financial and other expenses (net) Exceptional income and expenses Corporate taxes (2.9) Net income

14 Proposal for appropriation of net income Dividend per share in cents Payment of a dividend of 0.90 per share Trading ex-coupon on 2 June 2017 and payment in cash on 6 June Sharp increase of dividend over the past 2 years: +157%

15 Proposal for appropriation of net income ORIGIN Net income for the financial year 99,944, Retained earnings from previous years 1,251,495, Total to be allocated 1,351,439, APPROPRATION Statutory reserve 1,306, Dividend 124,232, Retained earnings 1,225,900, Total appropriation 1,351,439,

16 Financial Authorizations Share buy-back program (resolution 18) Maximum nominal purchase price of 60 euros Issue of ordinary shares or allotment of debt securities and/or securities giving access to ordinary shares with preferential subscription rights (resolution 20) 250 million euros for a capital increase, representing % of nominal share capital 1 billion euros in the case of debt securities (ceiling for issue of debt securities with or without preferential subscription rights) Issue of ordinary shares or allotment of debt securities and/or securities giving access to ordinary shares without preferential subscription rights (resolutions 21 and 22) 95 million euros for capital increase, representing 9.83% of nominal share capital 1 billion euros for issue of debt securities Capital increase reserved for employees (resolution 24) 3 % of capital stock 16

17 Outlook and Strategy Patrick Koller Chief Executive Officer

18 Completed transformation to become a global leader with diverse customer portfolio SALES BY CUSTOMER Chrysler Daimler Others Ford Hyundai Kia 24.7% VW Group Cummins Hyundai Kia FIAT-Chrysler BMW Others 19.1% VW Group Strong and well-diversified customer portfolio GM % Renault-Nissan 10.8% BMW 23.1% PSA Daimler GM PSA % Ford 13.0% 15.2% Renault-Nissan Well-balanced geographically Global leadership positions in each business North America Asia ROW 4% 4% 15% % SALES BY REGION Europe Asia ROW 4% 17% % Europe Strong profitability and financial flexibility Agile and dynamic teams with entrepreneurial culture North America 29% 18

19 Accelerating value creation Order intake: three year rolling Value-added sales in bn CAGR +11% Operating margin % of value-added sales CAGR +22% (in m) Net debt in m ROCE* % 25% 1,519 1, % 16% * Pre-tax and including goodwill

20 Profitable growth to accelerate from Order intake: three year rolling Value-added sales in bn CAGR +11 % Group operating margin m and % of value-added sales Growth objectives secured with order intake up 6bn Growth accelerating from new customers and new markets New premium customers growing 25 % Commercial vehicle sales growing 18 % CAGR On track to achieve 20% sales with Chinese OEMs by 2018 and 30% by % to be reached in 2017 Growth driven by new strategic partnerships 514 CAGR +17 % % 7 % Growth will come from all three Business Groups and from China

21 Film Inspiring mobility

22 Strategic priorities Sustainable mobility and smart life on board Market growth 25bn Market growth 40bn

23 Strong increase in value of aftertreatment systems for all vehicles World light vehicle production by powertrain technology % of vehicle production Value of system per vehicle 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Non ICE ICE Euro 6d Euro 7 EV/Fuel Cell Hybrid CNG/LPG Diesel Gasoline GASOLINE 120 Euro % 280 Euro 6d (2020) 360 Euro 5 DIESEL HYBRID +60% +210% 580 Euro 6d (2020) 120 Euro Euro 6d (2020) Value of after-treatment systems for all vehicles to grow from 225 in 2016 to 315 in

24 Growth driven by new markets and new technologies for powertrain electrification Lightweight and energy recovery solutions will accelerate with increased electrification Composites will become key technology for structural and semi-structural parts New markets opening up for Faurecia India and China commercial vehicles market becoming emissionized High horsepower, off-road and industrial applications using ASDS solution developed with Amminex Real time data monitoring Development of systems for fuel cell electric vehicles 24

25 Film Amminex

26 Cockpit of the Future will be connected, versatile and predictive 40bn Addressable market Cockpit of Future billion Connectivity and infotainment Smart surfaces and HMI technologies Seating and interiors Multidisciplinary teams set up on three continents Unique positioning as a full interior systems integrator Three development contracts with OEMs and six ongoing negotiations Acquiring new competencies for predictive cabin, smart surfaces, artificial intelligence and infotainment Silicon Valley France Yokohama 26

27 Film COF

28 Parrot Automotive Accelerating in connectivity and infotainment Over 50m vehicles equipped with Parrot connectivity modules 2015 revenue of 80m Team of 250 highly skilled engineers and developers 57 proprietary patents Unique infotainment solutions using open Android platform 10 infotainment contracts signed with major OEMs 28

29 Film parrot

30 Well positioned to achieve 2018 profitable growth objectives 2018 OBJECTIVES +6%* +400 bp above market 7% of VA sales > 500m 5 Value-added sales CAGR Operating margin 2018 Net cash flow 2018 Earnings per share 2017 GUIDANCE +6%* +400 bp above market % of VA sales > 350m Around Value-added sales growth 2017 Operating margin 2017 Net cash flow 2017 Earnings per share 30 * At constant currencies

31 Faurecia confirms New Trajectory Outperformed all objectives for 2016 set in 2013 Order intake confirms accelerating growth from 2017 A strategy aligned with industry megatrends Accelerating innovation for sustainable mobility and smart life on board Development of strategic partnerships important for our development Strategic flexibility: the means to achieve our ambition 31

32 Governance and compensation Jean-Pierre Clamadieu Linda Hasenfratz

33 Governance Reminder of the significant events of 2016 Succession plan of the CEO initiated since the Board of Directors of 16 th October 2014 having led to the dissociation of the offices of Chairman of the Board and of CEO from 1 st July 2016 A Governance Committee and a Management Committee set up after the Board of Directors of 25 th July 2016 replacing the Appointments and Compensation Committee: Governance Committee: dedicated to issues related to composition and functioning of the Board of Directors and of its Committees, including issues related to compensation of the Board members and of the Chairman of the Board Management Committee: dedicated to issues related to the Group managers up until the CEO, including issues related to compensation of the CEO 33

34 Governance Chairmanship and evolution of the Board composition Decision by the Board of Directors of 11 th April 2017 to appoint Michel de Rosen as Chairman of the Board of Directors at the outcome of the present AGM Yann Delabrière appointed as Honorary Chairman of Faurecia Board of Directors made of 14 members including 6 women and 9 independent members at the outcome of the present AGM: Resignation of Lee Gardner at the outcome of the Board of Directors of 11 th April 2017 Non renewal of the mandates of Yann Delabrière and Ross McInnes Renewal of mandates of four Board members and appointment of two new Board members Two Board members representing the employees will enter the Board during HY

35 Renewal of the mandates of four Board members for four years (resolutions 12 to 15) Ms Amparo Moraleda Mr Jean-Baptiste Chasseloup de Chatillon Mr Jean-Pierre Clamadieu Mr Robert Peugeot (first appointed by the 23 rd May 2012 AGM) (first appointed by the 23 rd May 2012 AGM) (first appointed by the 29 th May 2007 AGM) (first appointed by the 29 th May 2007 AGM) 35

36 Appointment of two new Board members for four years (resolutions 16 and 17) Mr Patrick Koller Ms Penelope Herscher 36

37 Modification of the bylaws with a view to appoint two Board members representing the employees (resolution 25) Modification of Article 11 of the bylaws to provide the conditions for appointment of two Board members representing the employees in accordance with Loi de sécurisation de l emploi of 14 th June 2013 and Loi relative au dialogue social et à l emploi of 17 th August 2015: One Board member appointed by the union obtaining the most votes in the first round of the elections organized within French companies of the Faurecia group The other one appointed by the European Works Council of the Faurecia group Duration of the mandate of four years from taking up their functions 37

38 Presentation of the Say on Pay Texts and Faurecia governance structure Sapin 2 Act of 9 th December 2016 and Afep-Medef Code: New "ex ante" vote relating to principles and criteria used for determining the compensation of executive and non executive corporate officers "Ex post" vote relating to the compensation of executive and non executive corporate officers in 2016 Reminder: dissociation Chairman of the Board of Directors and Chief Executive Officer from 1 st July Therefore: HY1 2016: Yann Delabrière, Chairman and CEO until 30 th June 2016 Patrick Koller, Deputy CEO (since 2 nd February 2015) until 30 th June 2016 HY2 2016: Yann Delabrière, Chairman of the Board of Directors from 1 st July 2016 Patrick Koller, CEO from 1 st July

39 Presentation of the Say on Pay Practical consequences for Faurecia As a consequence: six Say on Pay resolutions Chairman of the Board of Directors Ex ante(6 th resolution) Ex post (9 th resolution) for Yann Delabrière during HY Chief Executive Officer (CEO and Deputy CEO before dissociation) Ex ante (7 th resolution) Ex post: Chairman and CEO (8 th resolution) for Yann Delabrière during HY Deputy CEO (10 th resolution) for Patrick Koller during HY Chief Executive Officer (11 th resolution) for Patrick Koller during HY

40 Say on Pay of the Chairman of the Board of Directors Say on Pay Chairman of the Board of Directors Yann Delabrière (as from 1 st July 2016) 40

41 Say on Pay ex ante of the Chairman of the Board (resolution 6) Vote on the principles and criteria used to determine the compensation of the Chairman of the Board of Directors The compensation of the Chairman of the Board of Directors consists only in annual fixed compensation No other compensation (variable, attendance fees, exceptional compensation) is planned Use of a benchmark to determine the fixed compensation (French listed companies with dissociated governance structure) Taking into account of the profile and of the duties of the Chairman as described in the internal rules of the Board of Directors 41

42 Say on Pay ex post Yann Delabrière, Chairman of the Board of Directors (resolution 9) Opinion on the components of the compensation of Yann Delabrière in 2016 as Chairman of the Board of Directors (from 1 st July to 31 st December 2016) Nature of the compensation Amount due Amount paid in 2016 / Valuation Fixed compensation 300,000 on an annual basis 150,000 Valuation of benefits in kind (company car) 3, Total 153,

43 Say on Pay of the CEO Say on Pay Chief Executive Officer (Chairman and CEO/Deputy CEO before dissociation) Yann Delabrière / Chairman and CEO up to 30 th June 2016 Patrick Koller / Deputy CEO up to 30 th June 2016 Patrick Koller / CEO as from 1 st July

44 Say on Pay ex ante of the CEO (resolution 7) Vote on the principles and criteria used to determine the compensation of the Chief Executive Officer The compensation of the Chief Executive Officer is composed of the following components: Compensation Setting methods Fixed compensation Determined by using a benchmark (twenty similar industrial French companies) Short term variable compensation (annual) It may vary from 0 to 180% of the fixed compensation depending on the achievement of: Quantitative objectives giving right to a variable compensation ranging from 0 to150% of the annual fixed compensation Qualitative objectives which, depending on the level of achievement, allow a multiplier effect of the quantitative objectives ranging from 0.70 to

45 Say on Pay ex ante of the CEO (resolution 7) Vote on the principles and criteria used to determine the compensation of the Chief Executive Officer The compensation of the CEO is composed of the following components: Compensation Setting methods Long term variable compensation (performance shares) Subject to a presence condition and to performance conditions: Internal condition: after-tax net income of the Group, before taking into account potential exceptional events ; External condition: growth in net earning per Faurecia share as compared with weighted growth of a reference group of twelve worldwide comparable automotive suppliers Other No exceptional compensation is planned Company car Medical / Life / Disability insurance 45

46 Say on Pay ex ante of the CEO (resolution 7) Vote on the principles and criteria used to determine the compensation of the Chief Executive Officer The compensation of the CEO is composed of the following components: : Pension Setting methods Defined contribution pension scheme Identical for Group managerial staff Additional defined benefits pension scheme made of two parts A scheme open to Group managerial staff and subject to specific performance conditions for the CEO An additional scheme set up for Executive Committee members and subject to identical performance conditions for all beneficiaries 46

47 Say on Pay ex ante of the CEO (resolution 7) Vote on the principles and criteria used to determine the compensation of the Chief Executive Officer The compensation of the CEO is composed of the following components: Severance payment Setting methods Justified by the fact that the Board of Directors decided that the CEO can not be an employee and as a consequence can not enjoy the protective regime attached to such status Subject to performance conditions Is not due in case of gross negligence, resignation or retirement 47

48 Say on Pay ex post Yann Delabrière, Chairman and CEO (resolution 8) Opinion on the components of the compensation of Yann Delabrière in 2016 as Chairman and CEO (before 30 th June 2016) Nature of the compensation Calculation methods / percentage of achievement Amount paid in 2016 / Valuation Fixed compensation 800,000 on an annual basis 400,000 Variable compensation Base: 100% of the fixed compensation paid Quantitative objectives achieved up to 140.4% Qualitative objectives : multiplier effect of ,760 Valuation of benefits in kind (company car) 3, Valuation of performance shares allocated during the financial year No performance shares allocated in 2016 Total 1,021,

49 Say on Pay ex post Patrick Koller, Deputy CEO (resolution 10) Opinion on the components of the compensation of Patrick Koller in 2016 as Deputy Chief Executive Officer (before 30 th June 2016) Nature of the compensation Calculation methods / percentage of achievement Amount paid in 2016 / Valuation Fixed compensation 620,000 on an annual basis 310,000 Variable compensation Valuation of benefits in kind (company car, social security contribution paid by the company to managers) Valuation of performance shares allocated during the financial year Total Base: 80% of the fixed compensation paid Quantitative objective achieved up to 140.4% Qualitative objectives: multiplier of 1.1 Performance shares allocated during HY , , , euros 49

50 Say on Pay ex post Patrick Koller CEO (resolution 11) Opinion on the components of the compensation of Patrick Koller in 2016 as Chief Executive Officer (as from 1 st July 2016) Nature of the compensation Calculation methods / percentage of achievement Amount paid in 2016 / Valuation Fixed compensation 750,000 on an annual basis 375,000 Variable compensation Base: 100% of the fixed compensation paid Quantitative objectives achieved up to 140.4% Qualitative objectives: multiplier effect of ,150 Valuation of benefits in kind (company car) Valuation of performance shares allocated during the financial year 55,095 shares allocated (maximum). Will be vested in July 2020 subject to a presence condition and to achievement of internal and external performance conditions as at 31 December , ,722,931 Total 2,681,

51 Statutory auditors reports Valérie Quint Ernst & Young Audit

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