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2.1 2018 in review

2018 in review

Automotive revenue reached a record €3.03 billion, while recurring net profit continued to climb, to €243 million, which is a significant 20% more than in 2017.

NORMALISED AUTOMOTIVE EARNINGS PERFORMANCE

€ millions 2017(**) 2018 Chg. %
Revenue 2,842.5 3,029.5 6.6%
EBITDA (*) 471.1 529.0 12.3%
EBITDA margin 16.6% 17.5%
EBIT(*) 339.1 399.2 17.7%
EBIT margin 11.9% 13.2%
Net profit (*) 202.4 242.8 20.0%
(*) EBITDA: earnings before interest, tax, depreciation and amortisation; EBIT: earnings before interest and tax; Net profit: profit attributable to owners of the parent.
(**) In order to provide greater transparency and clarity in the information, the following is compared with the Automotive data published as comparable in the consolidated financial statements published by CIE Automotive 31/12/2018. The information differs from that published in 2017 due to the fact that, according to accounting standards, the specific impacts on the different lines of the income statement of those businesses discontinued in 2018 must be eliminated. For further information see the Consolidated Annual Accounts for the year ended 31 December 2018.

Performance by region

€ millions Business figure EBITDA EBIT
Europe 844.6 17.6% 12.2%
MCIE Europe 557.7 13.4% 9.7%
North America 763.3 22.8% 18.4%
Brazil 323.6 14.5% 11.2%
Asia (India & China) 540.3 15.7% 12.1%
Total 3,029.5

EBITDA CONTRIBUTION BY REGION

Gráfico

Balance sheet*

€ million 2016(*) 2017(*) 2018
Fixed assets 2,157.1 2,273.1 2,267.7
Net working capital (132.3) (189.2) (158.8)
TOTAL NET ASSETS 2,024.8 2,083.9 2,108.9
Equity 988.7 1,042.6 1,048.9
Net debt 930.2 948.7 948.2
Other (net) 105.9 92.6 111.8
Total equity and liabilities 2,024.8 2,083.9 2,108.9
(*) Balance sheet restated to exclude Dominion in order enable a comparable reading.

Value generated and distributed [201-1]

€ million 2016(***) 2017(***) 2018
Revenue 2,220.8 2,845.6 3,029.5
Economic value distributed 2016(***) 2017(***) 2018
To shareholders (dividends)* 42.6 52.9 72.1
To shareholders (special dividend)** 404.7
To employees (employee benefits expense) 445.5 532.0 557.8
To suppliers (consumption of raw materials and auxiliary materials) 1,271.1 1,683.7 1,836.7
To society (income tax paid) 43.3 55.9 66.9
(*) Dividend paid during the year.
(**) Market value of the special dividend articulated to distribute CIE Automotive’s interest in Dominion to its shareholders.
(***) In order to provide greater transparency and clarity in the information, the following is compared with the Automotive data published as comparable in the consolidated financial statements published by CIE Automotive 31/12/2018. The information differs from that published in 2017 due to the fact that, according to accounting standards, the specific impacts on the different lines of the income statement of those businesses discontinued in 2018 must be eliminated. For further information see the Consolidated Annual Accounts for the year ended 31 December 2018.

2.2 Milestones

January

  • INTEGRATION OF CIE AUTOMETAL MINAS
    Integration of the CIE Autometal Minas plant (Brazil), devoted to the injection, chroming and painting of plastic parts, into the group.
  • START-UP OF THE CIE NUGAR PUEBLA PLANT
    Start of operations at the new welding and assembly factory in Puebla (Mexico).

March

  • GLOBAL ROLLOUT OF CSR WORKSHOP FORMAT
    March marked the start of the global rollout of the CSR Workshop format in Brazil, followed in the second half of the year by similar events in the US, Mexico, China and India.

June

  • CIE AUTOMOTIVE ADDED TO THE IBEX-35
    CIE Automotive’s shares were added to Spain’s blue chip stock index, the IBEX-35, on 18 June.
  • INCREASE IN SHAREHOLDING IN MAHINDRA CIE
    Acquisition of an additional 5% interest in group subsidiary, Mahindra CIE Automotive Ltd.
  • $150 MILLION LOAN TO FUND GROWTH IN NORTH AMERICA
    CIE CIE Automotive arranged a $150 million loan with IFC and EDF to fund growth plans for Mexico.
  • FUNDING FOR INNOVATION EFFORT IN EUROPE
    The EIB extended CIE Automotive a €80 million loan to finance its R&D strategy.
  • APPROVAL OF THE NEW CORPORATE SOCIAL RESPONSIBILITY PLAN
    Board approval for a new CSR Plan for 2019-2020, designed to standardise and embed environmental, social and governance criteria across the group.

July

  • CIE AUTOMOTIVE EXITS DOMINION’S SHAREHOLDER RANKS
    CIE Automotive exited Dominion in July, as had been foreshadowed, by delivering its shareholders 0.65709 Dominion shares for every CIE Automotive share they held.
  • NEW SUPPLIER PORTAL
    Launch of a new online and free-to-use platform designed to facilitate engagement with suppliers. The platform is scheduled to be global in reach by the end of 2019.

September

  • PURCHASE OF INTEVA’S ROOFING SYSTEM DIVISION
    CIE Automotive agreed the acquisition of the world third-largest roofing system maker, a division of Inteva, for $755 million (€650 million)
  • FIRST COMMERCIAL PAPER PROGRAMME TO FINANCE WORKING CAPITAL
    First notes placed under the company’s new €200 million commercial paper programme, listed on the Irish Stock Exchange.

December

  • STRATEGIC ALLIANCE WITH SAVE THE CHILDREN
    Execution of the first community project at the corporate level: a collaborative agreement with Save the Children for the provision of training support to youths in Mexico.

2.3 CIE Automotive’s share price performance

We have arrived in the IBEX-35 to stay

The company paid out €72.1 million in cash divisions, growth of 37% year-on-year

The share price did not reflect the company’s fundamentals or its excellent performance

At any rate, the fact that CIE Automotive’s share price did not correct was laudable considering the fact that the IBEX-35 lost 15% and the Stoxx Europe 600 Automobiles & Parts corrected by 28%.

CIE Automotive exited Dominion’s shareholder ranks by distributing its shares in that subsidiary to its shareholders

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CIE Automotive’s stock market indicators

2016 2017 2018
Number of shares at year-end 129,000,000 129,000,000 129,000,000
Share price at year-end (€) 18.52 24.21 21.44
Pro forma share price at year-end (€)* 16.46 21.37 21.44
Market capitalisation at year-end (€ million) 2,388.4 3,123.1 2,765.8
Average trading volume 59,065 59,318 87,149
Dividends paid (€ million) 42.6 52.9 72.1 (before the in-kind dividend)
Payout** (%) 32% 33% 33%
Earnings per share (€) 1.00 1.26 1.67
P/E multiple*** 15.4 14.7 14.5
(*) Share price adjusted for the in-kind dividend consisting of the distribution of the company’s shares in Dominion.
(**) Payout: percentage of profit paid out to shareholders.
(***) P/E multiple: ratio between share price and EPS.

Share price performance

  1. Share price adjusted for the in-kind dividend consisting of the distribution of the company’s shares in Dominion.
  2. STOXX Europe 600 Automobiles & Parts is composed of: OEMS: BMW ST, Daimler, Ferrari NV, Fiat, Peugeot, Porsche, Renault, and Volkswagen. SUPPLIERS: Faurecia, Michelin, Nokian, Plastic Omnium, Rheinmetall, Schaeffler, Valeo.