New Delhi: French automotive technology company Valeo on Thursday reported improved profitability and stronger cash generation in the first half of 2026, while reducing its net debt, as the company reaffirmed its financial guidance for the full year despite an uncertain global economic environment.
The company posted sales of 10.4 billion euros (around Rs 1.05 lakh crore) during the January-June period, up 0.7 per cent on a like-for-like basis. Original equipment sales stood at 8.5 billion euros (around Rs 85,850 crore), declining 0.6 per cent on a like-for-like basis against a 1 per cent contraction in global automotive production.
Valeo’s operating margin rose 8 per cent year-on-year to 514 million euros (around Rs 5,190 crore), representing 5 per cent of sales, reflecting continued improvement in profitability. Free cash flow more than doubled to 242 million euros (around Rs 2,440 crore) from 100 million euros (around Rs 1,010 crore) in the corresponding period last year, highlighting stronger cash generation.
The company also reduced its net financial debt by nearly 200 million euros (around Rs 2,020 crore) to 3.83 billion euros (around Rs 38,680 crore) at the end of June, improving its leverage ratio to 1.2 times from 1.3 times at the end of 2025.
Valeo said its order intake remained strong at 12.1 billion euros (around Rs 1.22 lakh crore), in line with its Elevate 2028 strategic plan. The company also expanded beyond the automotive sector by securing its first contract to manufacture drone motors.
Commenting on the results, Valeo Chief Executive Officer Christophe Périllat said the first-half performance demonstrated the company’s disciplined execution of its Elevate 2028 strategy, with steady improvements in profitability, cash generation and debt reduction despite geopolitical and macroeconomic uncertainties.
He said the company continued to maintain strong commercial momentum through robust order intake while exploring opportunities beyond the automotive industry by leveraging its existing technologies without significant additional development costs.
Reaffirming its outlook for 2026, Valeo said it expects annual sales of 20-21 billion euros (around Rs 2.02 lakh crore to Rs 2.12 lakh crore), an operating margin of 4.7-5.3 per cent, and free cash flow of more than 400 million euros (around Rs 4,040 crore). The company added that, assuming stable market and supply chain conditions, it expects second-half operating margin and free cash flow to be at least at the same level as the first half.
