Valeo: First Half 2006: Sales and Results Up

Paris, France (ots/PRNewswire) - The Board of Directors, which met
today, approved the summarized consolidated accounts for the first
half 2006.

In millions of euros(x) 1st half Quarterly variation 2006
2006 2005(xx) Change 2nd quarter 1st
quarter(xx)
Total operating revenues 5,309 4,991 +6.4% 2,655 2,654
Gross margin 835 804 +3.9% 420 415
% of sales 15.9% 16.3% -0.4pt 16.0% 15.8%
Operating income 169 159 +6.3% 110 59
% of total revenues 3.2% 3.2% 0.0pt 4.1% 2.2%
Net income attributable
to Company shareholders 94 72 +30.6% 71 23
% of total revenues 1.8% 1.4% +0.4pt 2.7% 0.9%
Basic earnings per share
(in euros) 1.23 0.87 +41.4% 0.93 0.30

(x) Non audited

(xx) This data has been restated as required by IFRS 5.

The Group's half-yearly results show strong resilience in an
environment (automotive production and raw materials) that
deteriorated between the first and the second quarter. Valeo has
recorded progress in the areas of productivity and order intake.

First half 2006 Group results

Valeo's total operating revenues stood at EUR5,309 million in the
first half 2006, up by 6.4% versus the first half 2005. Excluding the
impact of exchange rates (+2.1%) and changes in the consolidated
reporting entity (+3.3%), total operating revenues increased by 1%,
in line with the growth in the Group's reference automotive
production.

The gross margin for the half rose by 3.9% to EUR835 million
(15.9% of sales), versus EUR804 million (16.3% of sales) for the
first half 2005. The Group considers that the rise in raw material
prices reduced the gross margin for the half by 0.6 points.

Operating income amounted to EUR169 million (3.2% of total
revenues) versus EUR159 million (3.2% of total revenues) for the
corresponding period in 2005. Operating income includes a net expense
of EUR32 million under "other income and expenses" versus an expense
of EUR34 million in 2005.

Income before tax for the half was EUR147 million versus EUR110
million in 2005. This includes a net debt cost of EUR31 million, up
by EUR8 million versus the first half 2005, resulting from the
acquisitions and share buyback program implemented in 2005. It also
includes a capital gain of EUR20 million generated by the sale of the
stake in Parrot.

Income tax totaled EUR44 million versus EUR35 million for the
first half 2005. The effective tax rate was 30% versus 33% for the
first half 2005.

The net income attributable to Valeo shareholders was EUR94
million for the first half 2006, versus EUR72 million for the first
half 2005. Earnings per share totaled EUR1.23, up by 41.4%.

The operating cash amounted to EUR93 million, versus EUR75
million for the first half 2005, up 24%.

At 30 June 2006, Valeo's net debt stood at EUR1,053 million,
versus EUR1,080 million at 31 December 2005. The debt-to-equity ratio
was 60%, versus 63% at year-end 2005.

The order intake for the half represents 1.2 times OEM sales,
versus 1.0 times for the second half 2005 and 1.2 times at 30 June
2005.

Outlook

For the second half of the year, the Group forecasts stable
production for light vehicles in Europe and a decrease of 2% in North
America. Valeo will step up its management efforts to offset the
negative effects of the rise in raw material prices on its
profitability.

The annual targets fixed at the start of the year (increased
content per vehicle, improved return on capital employed, sustained
level of free cash flow and rise in order intake) still stand.

Valeo is an independent industrial Group fully focused on the
design, production and sale of components, integrated systems and
modules for cars and trucks. Valeo ranks among the world's top
automotive suppliers and employs 72,900 people in 134 plants, 69 R&D
centers and 9 distribution centers in 28 countries.

For further information, please contact:

Bruno Roland Bernard, Vice-President, Group Communications,
Tel: +33-(0)1-40-55-20-65

Rémy Dumoulin, Investor Relations Director, Tel:
+33-(0)1-40-55-29-30

For more information on the Group and its business sectors,
please visit the website:

www.valeo.com

ots Originaltext: Valeo
Im Internet recherchierbar: http://www.presseportal.de

Contact:
For further information, please contact: Bruno Roland Bernard,
Vice-President, Group Communications, Tel: +33-(0)1-40-55-20-65. Rémy
Dumoulin, Investor Relations Director, Tel: +33-(0)1-40-55-29-30


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