Continuing a profitable growth strategy: Free cash-flow, cost reduction and industrial excellence to accelerate innovation and enhance technological content

INVESTOR RELATIONS

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-  13 December 2018

Continuing a profitable growth strategy: Free cash-flow, cost reduction and industrial excellence to accelerate innovation and enhance technological content

To mark its Investor Day, held today at its global R&D center for clean energy systems, α-Alphatech in Compiègne, Plastic Omnium is unveiling its strategy for profitable and independent growth to take account of the volatility of automotive markets in a context of technological change acceleration.

A global and diversified automotive pure player

An independent family group, Plastic Omnium is a global player present in 26 countries, with 122 plants and serving 83 automotive brands.
Following the takeover of HBPO, the world leader in front-end modules, on July 1st, 2018, and the disposal of the Environment Division due to take place on December 17th, 2018, Plastic Omnium confirms its position as an automotive pure player organized around two operating segments with different business models:
- Plastic Omnium Industries, dedicated to production activities for intelligent exterior systems and clean energy systems, with significant investment and long cycles;
- Plastic Omnium Modules: dedicated to design and assembly activities for complex modules with low levels of capital employed.

2018: a complex market environment

2018 was marked by a steady increase in macro-political and macro-economic risks (trade wars, Brexit, slowdown in China), resulting in uncertainties and heightened volatility (currency, raw materials, interest rates, etc.). In this context, to which should be added the decline of diesel and new regulations relating to the certification of new vehicles in Europe (WLTP), the automotive market deteriorated in the second half-year, with an expected fall of 3.2%, following an increase of 2.2% in the first half, resulting in a decrease of 0.5% for the full-year.

In this market environment, Plastic Omnium confirms the following financial outlook for 2018 (compared with 2017 IFRS 5 data, i.e. restated for the Environment business):
- growth in economic revenue of at least 5%, i.e. revenue of approximately 8.9 billion euros in proforma figures;
- growth in consolidated revenue of at least 10%;
- 2018 operating result comparable to that of 2017 (615 million euros in 2017);
- a sharp increase in net result group share following scope effects;
- triple-digit free cash-flow.

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Investor Day presentation

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