full-year 2021 results, a foundational year for Faurecia, resilient performance despite headwinds with solid order intake, Forvia on track to deliver on ambitions

Nanterre (France), February 21, 2022

FULL-YEAR 2021 RESULTS

A FOUNDATIONAL YEAR FOR FAURECIA

RESILIENT PERFORMANCE DESPITE HEADWINDS, WITH SOLID ORDER INTAKE

FORVIA ON TRACK TO DELIVER ON AMBITIONS

2021: A FOUNDATIONAL YEAR FOR FAURECIA

2021 RESULTS: RESILIENT PERFORMANCE DESPITE HEADWINDS, NOTABLY SEMICONDUCTOR SHORTAGE, WITH SOLID ORDER INTAKE AMOUNTING TO CUMULATIVE €75 BILLION FOR 2019-2021

In 2021, worldwide automotive production* was strongly impacted by the semiconductor shortage and remained low for a second consecutive year at 73.4 million light vehicles (LVs), up only 3.8% vs. 2020, which had been heavily affected by the Covid-19 crisis.

* Source: IHS Markit dated February 2022, as usually restated by Faurecia, i.e. vehicles segment in line with CAAM for China
** 2020 restated for IFRS 5 (see in appendix)

2022 GUIDANCE FOR FAURECIA STANDALONE: CONTINUED STRONG SALES GROWTH, SOLID OPERATING LEVERAGE AND CASH GENERATION

At this stage and due to the recent closing of the HELLA acquisition, Faurecia is only guiding for its standalone scope. Assuming that worldwide automotive production will recover to 78.7 million vehicles in 2022, Faurecia’s standalone full-year 2022 guidance is as follows:

• Sales between €17.5bn and €18bn

• Operating margin between 6% and 7%, with H2 close to pre-Covid levels

• Net cash flow of c.€500m before HELLA acquisition impact

DIVIDEND PAYMENT OF €1 PER SHARE, TO BE PROPOSED AT THE NEXT SHAREHOLDERS’ MEETING

FORVIA ON TRACK TO DELIVER ON AMBITIONS

• Successful closing on January 31, 2022 as expected

• Faurecia now owns a controlling stake exceeding 80% of HELLA

• Creation of FORVIA, the newly combined Group’s name

• FY 2022 guidance for the combined group to be released on April 28, 2022 (with Q1 2022 sales announcement); detailed strategic plan to be presented at a Capital Markets Day in H2 2022

Story continues

Patrick KOLLER, CEO of Faurecia, declared:

“2021 was a foundational year for Faurecia. Firstly, the successful spin-off from PSA/Stellantis significantly increased our free float, enlarged our international shareholder base and enhanced share liquidity. Secondly, we launched the acquisition of a majority stake in HELLA, a strategic and transformative investment that was successfully closed within five months.

For the full year, we achieved another strong sales outperformance, solid operating leverage and significant cash generation. This was in spite of the acute semiconductor shortage, unprecedented OEM production volatility with widespread Stop & Gos disruption, and one launch issue in North America.

We also recorded a solid order intake, leading to a cumulative 75 billion euros received over the past three years, including significant awards in key business segments such as Electronics and Hydrogen.

2022 will continue to be impacted by the semiconductor shortage, which should begin to ease from the second half of the year. In this context, we will continue our strict cost control and focus on operational efficiency to drive continuous improvement in our financial performance.

Our most exciting challenge for 2022 will be the great opportunity to combine our operations and teams with HELLA to create a powerful Group, which is far more than the sum of the two pre-existing companies. FORVIA is now fully on track to deliver on its ambitions.

I would like to thank our talented people for all that has been achieved in the past year – and the combined teams of Faurecia and HELLA for their commitment to make 2022 a great year for our new Group, FORVIA.”

• The 2021 consolidated financial statements have been approved by the Board of Directors at its meeting held on February 18, 2022, under the chairmanship of Michel de ROSEN. These financial statements have been audited.

• Operating income presented as Faurecia’s main performance indicator is Operating income before amortization of intangible assets acquired in business combinations. All other definitions are explained at the end of this Press Release, under the section “Definitions of terms used in this document”.

• All figures related to worldwide or regional automotive production refer to the IHS Markit forecast dated February 2022 (vehicles segment in line with CAAM for China).

2021: A FOUNDATIONAL YEAR FOR FAURECIA

The past year was a turning point for Faurecia and marked a step change in the Group’s history.

Two key milestones for Faurecia:

March 2021 saw the successful distribution of the Faurecia shares previously held by PSA, then Stellantis. This spin-off from its historical shareholder resulted in a significant increase to Faurecia’s free float, to above 90%, with an enlarged international shareholder base and increased share liquidity.

As of that date, the four major historic shareholders of PSA and FCA held a combined stake of 13.2% in Faurecia: Exor with 5.5%, Peugeot 1810 with 3.1%, Bpifrance with 2.4% and Dongfeng with 2.2%.

In addition, Faurecia successfully launched its first Employee Shareholding Plan, “faur’ESO”, with a high subscription rate of 22%. The completion of the capital increase, for a total amount of €100 million, and the settlement-delivery of shares to employees took place in July. Shares were purchased in H1 2021 through a buyback program and then cancelled in H2 2021 to neutralize the potential dilution.

On August 14, 2021, Faurecia announced the launch a Public Tender Offer on HELLA shares together with the acquisition of the 60% stake held by the Hueck and Roepke Family pool.

This acquisition marked a major step in Faurecia’s ambition to accelerate its strategic transformation, investing in fast-growing segments with leading positions.

The combination of Faurecia and HELLA creates the #7 global automotive supplier, with a highly advanced technology portfolio addressing all industry megatrends and one overriding ambition: to shape a safe, sustainable, advanced and customized mobility.

Through this combination, the newly-formed FORVIA group will:

• Develop a stronger and focused offer for Electric Mobility (BEVs + FCEVs), thus significantly increasing its “powertrain-agnostic” share of revenue,

• Become a major player in Electronics and Software solutions to accelerate in ADAS & Autonomous Driving,

• Boost its Cockpit of the Future strategic focus thanks to the complementarity of Faurecia’s leading positions in Seating and Interiors, HELLA’s in Lighting and both companies’ Electronics activities,

• Create a Lifecycle Solutions activity, fully aligned with growing environmental concerns and industry developments.

FORVIA will also accelerate innovation through strong R&D capabilities, capitalize on the complementarity of customer portfolios across all geographies and leverage Faurecia’s strong positions in China and Asia.

Besides accelerating sales growth, strong synergies will drive continuous improvement in profitability and cash generation.

The Public Tender Offer was launched on October 27, 2021 and ended on November 11, 2021.

Since the closing of the transaction, completed on January 31, 2022, Faurecia has owned a controlling stake exceeding 80% of HELLA shares. HELLA will be consolidated in Faurecia’s accounts as from February 1, 2022.

The price paid in total for the controlling stake exceeding 80% of HELLA shares held as of January 31, 2022 amounted to c. €5.4bn, comprising:

• 60% of HELLA shares from the Family pool, paid for c. 52.1% in cash (representing c. €3.5 bn) and for c. 7.9% with 13,571,385 newly issued Faurecia shares (representing c. €0.5bn),

• c. 20% of HELLA shares mostly from the settlement of the Public Tender Offer ended on November 11, 2021 (representing c. €1.4bn).

As a consequence of the payment in cash and in Faurecia shares, the Family pool became the largest shareholder of Faurecia with c. 9% of the Faurecia share capital, as of January 31, 2022. The Family pool also agreed to be subject to a first lock-up of its Faurecia shares for 18 months starting from the closing date and a subsequent lock-up of 12 months for the portion of their Faurecia shares exceeding 5% of Faurecia’s share capital.

This strategic and transformative acquisition represents a significant driver for earnings and cash accretion and will contribute to enhanced value creation for all shareholders.

CLIMATE CHANGE AT THE HEART OF FAURECIA’S STRATEGY

ACCELERATION OF ZERO-EMISSION HYDROGEN STRATEGY

Climate change at the heart of our strategy

In 2021, Faurecia continued to develop through the lens of sustainability. The Group is fully on track to become CO₂ neutral for scopes 1 and 2 by 2025 and to reduce by 50% its scope 3 controlled emissions in 2030 before reaching net zero by 2050 at the latest, focusing on three main levers: use less, use better, use longer. Through this we aim to reduce our environmental impact and create long-term value across our entire supply chain.

In 2021, Faurecia’s secured two major partnership to reach its CO₂ ambitions:

Under this partnership, Faurecia will benefit from KPMG’s expertise to prepare, execute and implement its solar panel equipment program across all facilities worldwide. The installation of solar panels in Faurecia premises is a major step on the Group’s journey to become CO₂ neutral for its internal emissions by 2025. As Faurecia will delegate the installation and the operation of these renewable electricity production assets to third parties (“developers”), KPMG will advise and support Faurecia to identify and contract the right developers.

Under this partnership, ENGIE, a world leader in low-carbon energy and services, will provide energy solutions to be deployed across 100+ Faurecia sites worldwide by mid-2022. ENGIE will accompany Faurecia through the deployment of energy-saving equipment & methodology solutions in Europe, China, Brazil and Mexico, enabling a 15% reduction of site energy consumption out of a reference of around 600 GWh. Reducing energy consumption by adopting innovative digital solutions for efficiency is in line with Faurecia’s CO₂ neutrality roadmap and “Use Less” approach.

Faurecia announced the creation of a new cross-business division for sustainable materials.

This new division will benefit from Faurecia’s leading market positions in Interiors and Seating, unique portfolios of materials with ultra-low and negative CO₂ emissions and materials integrating thermal, acoustic and bio-medical technologies. It will work across Business Groups and propose a full cockpit low-CO₂ and CO₂-negative materials approach to support OEMs’ sustainability objectives. In 2022, Faurecia will build a dedicated Sustainable Materials R&D center and a pilot plant. The new division will initially employ 125 engineers, increasing to more than 400 in 2030.

In 2021, Faurecia launched the “Seat for the planet” initiative dedicated to improving industrial processes, material use and seat design to reduce lifecycle CO₂ footprints. “Seat for the Planet” is part of the cross-Business Group initiative to develop sustainable materials and circular economies in the automotive industry, beyond OEMs’ specifications and targets.

Acceleration of Zero-Emission Hydrogen strategy

Faurecia further internationalized its hydrogen capabilities with the May 2021 acquisition of a majority stake in CLD, a leading Chinese manufacturer of hydrogen tanks.

CLD, which has significant growth potential in the Chinese market, has also been certified by the Chinese central government as the first domestic producer of Type IV hydrogen tanks. Unlike Type III tanks, which use an aluminum liner instead of a plastic one, Type IV tanks are lighter and thus better suited to mobility applications. Through the acquisition of CLD and thanks to the certification of Type IV tanks, Faurecia will further energize its momentum for hydrogen mobility in China.

Faurecia continued to structure its industrial footprint for hydrogen activities.

In March 2021, Faurecia announced a 165 million euros investment in an industry 4.0 platform in Allenjoie (France). With high-performance industrial capacity, this new site will support the growth of Faurecia’s hydrogen storage system business. Serial production will start in 2023 with a strong ramp-up expected in 2024. The Allenjoie site will provide Faurecia with a capacity of up to 100,000 tanks per year.

In 2022, Symbio (JV with Michelin) will build a new facility in Lyon (France) for hydrogen stacks production.

Faurecia’s reaffirmed ambitious roadmap to become a Zero-Emission Hydrogen leader.

In 2021, Faurecia achieved an order intake of €500m (including 100% of Symbio), in line with the target presented at its Capital Markets Day in February 2021 and on track to reach the sales ambition of €500 million in 2025 (including 100% of Symbio). The ambition to reach over €3.5 billion of sales (including 100% of Symbio) in 2030 is furthermore confirmed.

In 2021, Faurecia began pre-serial production for Stellantis, Hyvia (Renault Group) and Hyundai in France and Korea and for SAIC in China.

In October 2021, Faurecia and Air Liquide announced the signature of a joint development agreement to design and produce on-board liquid hydrogen storage systems for the automotive industry. Through this technology partnership, the two companies will accelerate the deployment of zero-emission heavy-duty mobility. The partnership will leverage the companies’ complementary competencies from their respective core businesses, which will be fundamental to accelerate the technology’s time-to-market.

SOLID ORDER INTAKE AMOUNTING TO CUMULATIVE €75BN FOR 2019-2021

In 2021, Faurecia continued to increase customer satisfaction, thanks to its Total Customer Satisfaction program achieving an average score of 4.5 stars (maximum is 5) vs. 4.2 stars in 2020 with over 3,260 customer responses. In addition, Faurecia saw an increase in customer recognition in 2021, with over 70 awards for global performance, manufacturing excellence, cost savings and innovation.

A new year of solid order intake in 2021 led to a cumulated amount of €75 billion for the last three years (2019-2021), representing continued market share gains and securing future profitable growth prospects.

This performance supports Faurecia’s ambition to achieve sales of at least €24.5 billion euros in 2025 (for Faurecia standalone excluding the HELLA acquisition, as presented at Faurecia’s Capital Markets Day held in February 2021).

New 2021 business awards, with strong profitability, included:

• A total of 213 new awards over 2021,

• €2.6 billion for Clarion Electronics, in line with the target presented at Faurecia’s Capital Markets Day held in February 2021, thus demonstrating the strong potential for this Business Group (driven by Chinese and Japanese OEMs, Stellantis and RNM),

• €500 million for Zero Emission Hydrogen solutions (including 100% of Symbio), in line with the target presented at Faurecia’s Capital Markets Day held in February 2021,

• €6.1 billion for Electric Vehicles (EVs + FCEVs), representing 26% of total order intake,

• €6.4 billion for China, representing 27% of total order intake and reflecting the continued strong Chinese market growth potential.

2021 WAS ANOTHER YEAR OF TOUGH MARKET CONDITIONS: THE SEMICONDUCTOR SHORTAGE DISRUPTED ACTIVITY AT CUSTOMERS AND RESULTED IN NUMEROUS AND ERRATIC PRODUCTION STOP & GOs FOR FAURECIA

After a very low point of 70.7 million light vehicles (LVs) produced in 2020, heavily impacted by the emergent Covid-19 pandemic, worldwide automotive production had been expected to recover significantly in 2021: in February 2021, IHS Markit’s full-year forecast was 80.9 million LVs (+14% vs. 2020) and Faurecia’s assumption was a more cautious 76.6 million (+8% vs. 2020).

In the event, worldwide automotive production amounted to only 73.4 million LVs in 2021, up only 3.8% year-on-year. This poor performance largely reflected the global semiconductor shortage, which impacted the industry throughout the year. The impact worsened in the second half, after a first half already marked by difficult climatic conditions in Texas and a fire at a major Japanese semiconductor supplier.

The difficult situation in H2 2021, with a very low point in Q3 (with 15.8 million LVs produced in the quarter, down 19% vs. Q3 2020), strongly disrupted our customers’ activity, generating unprecedented volatility in OEM programs resulting in numerous and erratic production Stop & Gos for Faurecia.

Worldwide automotive production* (in million vehicles)

*Source: IHS Markit forecast dated February 2022 (vehicles segment in line with CAAM for China)

Volatility in OEM programs, at its peak in September and October, started to normalize as from November. These disruptions reduced Faurecia’s cost flexibilization capabilities, especially for just-in-time deliveries, and generated higher quality-related costs.

The semiconductor shortage is expected to continue in H1 2022 but should gradually ease from H2 2022 onwards, with the global situation returning closer to normal in 2023.

Worldwide automotive production is currently forecast by IHS Markit at 80.7m LVs in 2022, still far from the 85.3 million vehicles produced in 2019 but nevertheless up 9.9% vs. 2021.

Faurecia’s assumption for worldwide automotive production in 2022 is slightly lower than IHS at 78.7m LVs, with a phasing that anticipates a slight decrease year-on-year in H1 (c. -2%, mostly due to the high base of Q1 2021) and a strong year-on-year increase in H2 (up 17%, eased by the low base of comparison in H2 2021 and reflecting the expected gradual easing of the semiconductor shortage).

2021 GROUP SALES AND PROFITABILITY

STRONG SALES OUTPERFORMANCE AND OPERATING LEVERAGE

The following table details sales and operating income evolution in H2 and FY 2021 at Group level:

In H2:

• Sales amounted to €7,835 million, down 6.3% on a reported basis and down 7.9% on an organic basis in a market that dropped by 14.4%

• The negative currency effect in H1 reversed to positive in H2, mainly attributable to the Chinese yuan and the US dollar vs. the euro: net positive currency effect amounted to €132 million or +1.6% of sales.

• On an organic basis, sales were down 7.9% but posted a strong outperformance of 650bps. Restated for the unfavorable geographic mix impact of c. -500bps, sales outperformance was even stronger, close to 1,150bps.

• Operating income amounted to €352 million or 4.5% of sales, down 170bps year-on-year, mostly impacted by lower volumes and costs related to the numerous production Stop & Gos from high volatility in OEM programs

• As in H1, profitability was impacted by the increase in raw material prices, whose net impact amounted to €(43) million.

• It was also impacted by operational difficulties met in the launch phase of a greenfield Seating program in Michigan (USA); extra-costs related to this program amounted to €(100) million during the period.

In FY:

• Sales amounted to €15,618 million, up 8.1% on a reported basis and up 8.8% on an organic basis

• Net negative currency effect for the year amounted to €(164) million or -1.1% of sales.

• Positive scope effect amounted to €60 million or +0.4% of sales and reflected a contribution of one months from SAS (January), whose consolidation started in February 2020.

• On an organic basis, sales were up 8.8% and posted a strong outperformance of 500bps. Restated for the unfavorable geographic mix impact of c. -300bps, sales outperformance was even stronger, close to 800bps.

• Operating income amounted to €862 million or 5.5% of sales, up 260bps year-on-year, reflecting strong operating leverage estimated at 34%

• As mentioned above, it was impacted by €(100) million extra-costs related to the operational difficulties met in the launch phase of a greenfield Seating program in Michigan (USA) in H2

• The full-year net impact from raw material inflation amounted to €(70)m.

• Operating leverage, calculated as the increase in operating income (excl. one-offs related to PIS-Cofins tax recovery in Brazil and Employee shareholding plan in H1 2021 and scope effect & other) over the increase in sales at constant scope, was strong at 34% (see calculation in appendix).

2021 SALES AND PROFITABILITY BY BUSINESS GROUP

Seating (39% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

• Operating margin at 4.7% in 2021, reflected:

  • Strong operating leverage in H1

  • Cumulated negative impacts in H2 of Stop & Gos and €(100)m related to operational difficulties met in the launch phase of a major greenfield program in Michigan (US)

• Excluding the €100m negative impact above mentioned, operating margin stood at 6.4% in 2021

Update on fixing operational difficulties in Michigan (US)

• In H2 2021, Faurecia’s experienced operational difficulties in the launch phase of a greenfield Seating project in Michigan (US) met in the two new separate production units (one for Metal and one for Assembly of complete seats) resulting in a total extra-costs of €(100) million related to:

  • Structural shortage of the US labor market leading to difficulties in hiring and attracting the necessary technical competencies;

  • Instability of workforce leading to high absenteeism and turnover;

  • Wage inflation;

  • Very limited technical onsite support linked to the pandemic situation (no travel to the US);

  • Production quality issues & ramp up difficulties.

• At the end of 2021, the situation was under control with actions taken by Faurecia related to:

  • The appointment of a new Head of North America to increase autonomy of the North American organization;

  • Faurecia’s teams sent to support operations locally as borders re-opened early November;

  • Stabilization of qualified workforce and use of subcontractors;

  • Gradual ramp-up of production to meet customer’s needs.

• The next major step will come from the optimization of the current industrial set-up related to this program

• In H1 2022, the remaining extra-costs are expected to reach c.€(30) million and the program will be profitable in H2 2022.

Interiors (30% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

Clean Mobility (26% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

Clarion Electronics (5% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

• Broadly flat operating income, despite increased costs of semiconductors (mainly in H2), negative mix effect (aftermarket vs. product sales) and further restructuring and depreciation costs

2021 SALES AND PROFITABILITY BY REGION

Europe (45% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

North America (24% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

• Operating margin at 1.3%, mostly impacted by H2:

  • Significant negative impact from Stop & Gos

  • €(100)m extra-costs related to operational difficulties in the launch phase of a greenfield Seating program in Michigan

• Excluding the forementioned €100m negative impact, operating margin stood at 4.0% in 2021

Asia (27% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

• Strong sales outperformance of 1,520bps in H2 and 890bps in FY, with sales exceeding 2019 pre-Covid level both in Asia & China

  • In China, sales posted a strong organic growth of 17.7%, an outperformance of 1,070bps

  • Growth was driven by Seating, Interiors and Clarion Electronics and by most OEMs

Operating income

Rest of the World (4% of Group sales)

* Restated for IFRS 5 (see in appendix)

Sales

Operating income

NET INCOME OF CONTINUED OPERATIONS: PROFIT OF €113 MILLION VS. A LOSS OF €(303) MILLION IN 2020, INCLUDING COSTS OF €(41) MILLION RELATED TO THE ACQUISITION OF HELLA

NET INCOME GROUP SHARE: LOSS OF €(79) MILLION VS. A LOSS OF €(379) MILLION IN 2020, INCLUDING THE IMPACT OF THE DIVESTMENT OF AST FOR €(96) MILLION

Group operating income stood at €862 million, vs. €418 million in 2020.

• Amortization of intangible assets acquired in business combinations: net charge of €93 million broadly stable vs. a net charge of €92 million in 2020.

• Restructuring costs: net charge of €196 million, significantly reduced vs. a net charge of €285 million in 2020 (of which €196 million in H2 2020); restructuring expenses will gradually normalize as market conditions improve.

• Other non-recurring operating income and expenses: net charge of €42 million vs. a net profit of €9 million in 2020; it included a charge of c.€26 million due to costs related to the acquisition of HELLA.

• Net financial result: net charge of €254 million vs. a net charge of €218 million in 2020; it included a charge of c.€16 million due to costs related to the acquisition of HELLA (mainly the Bridge Loan fees amortization).

• Income tax: net charge of €139 million vs. a net charge of €122 million in 2020; the high tax rate as percentage of pre-tax income reflected the cumulated effects of unfavorable geographic mix due to increased share of profit in China, withholding tax, French CVAE and BEAT tax in the USA.

• Share of net income of associates: charge of €25 million vs. a charge of €13 million in 2020; the increase is mainly attributable to increased investment in Symbio, the 50/50 JV with Michelin for Hydrogen stacks.

Net income of continued operations was a profit of €113 million vs. a loss of €(303) million in 2020. It included a charge of €(41) million related to the acquisition of HELLA, not yet consolidated into Faurecia’s accounts.

Net income of discontinued operations was a loss of €(96) million, due to the divestment of AST (operating loss until the date of effective disposal + capital loss on disposal).

Net income was a profit of €16 million vs. a loss of (321) million in 2020.

Minority interests amounted to €95 million vs. €57 million in 2020, mainly reflecting the increase in profits with Chinese partners.

Net income Group share was a loss of €(79) million vs. a loss of €(379) million in 2020.

EBITDA: €2.1 BILLION, REPRESENTING 13.5% OF SALES (UP 190bps VS. 2020)

NET CASH FLOW: €317 MILLION (VS. €13 MILLION IN 2020), BEFORE AN OUTFLOW OF €(12) MILLION RELATED TO THE ACQUISITION OF HELLA

NET-DEBT-TO-EBITDA RATIO REDUCED TO 1.6x AT END 2021 (VS. 1.9x AT END 2020)

SOUND FINANCIAL STRUCTURE AND STRONG LIQUIDITY AT YEAR-END 2021

SECURING FINANCINGS FOR THE HELLA TRANSACTION

2021 EBITDA of €2.109 million represented 13.5% of sales compared to an EBITDA of €1,669 million and 11.6% of sales in 2020, i.e. an improvement of €440 million and 190bps of sales year-on-year.

• Capital expenditure was contained to an outflow of €530 million, fully in line with target of “below €600m”, vs. an outflow of €464 million in 2020.

• Capitalized R&D was an outflow of €670 million vs. an outflow of €613 million in 2020.

• Change in working capital requirement (excluding factoring) was an outflow of 19 million vs. an outflow of €107 million in 2020.

• Factoring of receivables of €1,069 million at the end of 2021 represented an inflow of €72 million vs. the end of 2020 (it was an inflow of €38 million in 2020).

• Restructuring represented an outflow of €175 million vs. an outflow of €124 million in 2020. It reflected part of the restructuring actions decided in H2 2020.

• Net financial expense was an outflow of €230 million vs. an outflow of €205 million in 2020; it reflected the debt increase in value and included the outflow related to securing the financing of the HELLA acquisition.

• Income tax was an outflow of €243 million vs. an outflow of €196 million in 2020.

• Other operational items before €12m outflow related to the HELLA acquisition represented an inflow of €1 million vs. an inflow of €15 million in 2020.

Net cash flow amounted to €317 million before a negative impact of €12m related to HELLA acquisition and to €305 million after this impact (vs. €13 million in 2020).

• Dividend paid (incl. minorities) was an outflow of €201 million vs. an outflow of €35 million in 2020; this increase is mainly due to the fact that no dividend was paid in 2020 to Faurecia’s shareholders because of the extraordinary context of the Covid-19 crisis.

• Share purchase was an outflow of €26 million vs. an inflow of €6 million in 2020; mainly related to Faurecia’s first Employee Shareholding Program “faur’ESO”

• Net financial investments and other cash elements was an outflow of €126 million vs. an outflow of €369 million in 2020; it included outflow for investing in bolt-on acquisitions and Symbio and an outflow related to the acquisition of HELLA.

Net debt before the negative impacts of discontinued activities (disposal of AST) and of IFRS16 was increased by €48 million at the end of 2021 vs. the end of 2020.

Net debt excluding the IFRS 16 related debt of €1,032 million at December 31, 2021 stood at €2,435 million.

After the negative impacts of discontinued activities for €(49) million and of increased IFRS 16 debt for €(241) million, the Group’s net financial debt stood at €3,467 million at December 31, 2021 (vs. €3,128 million at December 31, 2020).

Net-debt-to-EBITDA ratio was reduced to 1.6x EBITDA at December 31, 2021 vs. 1.9x at December 31, 2020, reflecting continuous deleveraging.

In 2021, Faurecia has strictly managed its financings in line with its strategy to constantly manage flexibility and debt maturity and, since August, in order to secure and prepare for the acquisition of HELLA:

• February 2021: issuance of Senior bonds for €190 million, due 2027, at 2.26%,

• March 2021: first issuance of Senior Green notes for €400 million, due 2029, at 2.375%,

• May 2021: increase of the long-term Syndicated Credit Facility from €1.2 billion to €1.5 billion and maturity extended from June 2023 to May 2026 with options up to May 2028,

• August 2021: bridge facilities agreement of €5.5 billion (including a €500 million three-year term loan) to secure the financing of the project to acquire HELLA and to be refinanced mostly through bond issuances and bank loans,

• November 2021: issuance of €1.2 billion of 2.75% Senior Sustainability-linked bonds, due 2027,

• December 2021: ESG-linked Schuldscheindarlehen for €700 million, with maturity up to 6 years, at an average cost of 2%.

At year-end 2021:

• Faurecia had strong liquidity of €6.4 billion, of which available cash for €4.9 billion and an undrawn Syndicated Credit Facility for €1.5 billion, including pre-financing transactions for the acquisition of HELLA (vs. €4.3 billion at year-end 2020, of which available cash for €3.1 billion and an undrawn Syndicated Credit Facility for €1.2 billion),

• Faurecia had already partly refinanced the bridge facilities agreement signed in August 2021 to secure the acquisition of HELLA,

• Faurecia had an average cost of its gross long-term debt (excluding IFRS16 debt) below 2.8%, with no major debt repayment before 2025,

• Faurecia maintained a solid credit rating with its three agencies, including the impact of the acquisition of HELLA: BB+ Stable outlook with Fitch Ratings, Ba2 Negative outlook with Moody’s and BB Stable outlook with Standard & Poor’s.

PROPOSED DIVIDEND OF €1 PER SHARE, STABLE YEAR-ON-YEAR

TWO NEW BOARD MEMBERS FOR APPROVAL AT THE NEXT SHAREHOLDERS’ MEETING

The Board of Directors will propose at the next Annual Shareholders’ Meeting, to be held in Paris on June 8, 2022, the payment of a dividend of €1 per share.

This dividend is stable vs. the dividend paid in 2021; it reflects Faurecia’s strategy to maintain a fair and attractive remuneration to its shareholders while maintaining a sound financial structure and being fully aligned with the Group’s deleveraging trajectory post-HELLA acquisition, as announced last August (net-debt-to-EBITDA ratio back to ≤ 1.5x at the end of 2023 and at 1x at the end of 2025).

It will be paid in cash or shares at shareholders’ option, for all shares.

On June 8, shareholders will also be proposed to approve the appointment of two new Board members: Mrs. Judy Curran and Dr. Jurgen Behrend.

At its meeting held on February 18, 2022, the Board of Directors decided to co-opt Mrs. Judy Curran, as a replacement of Mrs. Linda Hasenfratz, to whom Faurecia expresses its gratitude for her contribution to the Board of Directors. Her appointment will be proposed for ratification at the next Shareholders’ Meeting.

Mrs. Judy Curran is currently Head of Global Automotive Strategy at Ansys which develops and markets engineering simulation software for a range of industries. She is a highly experienced automotive professional who, over 30 years at Ford Motor Company, held a number of key roles including Director of Technology Strategy.

Dr Jürgen Behrend, as indicated at the closing of the acquisition of HELLA, will also be proposed for joining the Board as a representative of the Hueck and Roepke Family pool, underlining its strong commitment to FORVIA’s strategy and outlook.

2022 GUIDANCE FOR FAURECIA STANDALONE REFLECTS STRONG OPERATING LEVERAGE AND SOLID CASH FLOW GENERATION

At this stage and due to the recent closing of the HELLA acquisition, Faurecia is only guiding for its standalone scope. A full-year 2022 guidance for the combined Group (including the consolidation of HELLA as from February 1, 2022) should be released along with Q1 sales figures, on April 28, 2022.

As mentioned earlier, Faurecia’s assumption for worldwide automotive production stands at 78.7m LVs with a phasing that anticipates a slight decrease year-on-year in H1 (c. -2%, mostly due to the high base of Q1 2021) and a strong year-on-year increase in H2 (up 17%, eased by the low comparable base of H2 2021 and reflecting the expected gradual easing of semiconductor shortage).

Based on this assumption, Faurecia’s standalone full-year 2022 guidance is:

• Sales between €17.5bn and €18bn (vs. €15.6bn in 2021)

• Operating margin between 6% and 7% (vs. 5.5% in 2021), with H2 close to pre-Covid levels

• Net cash flow of c.€500m before HELLA acquisition impact (vs. €317m in 2021)

This guidance:

• Assumes no major lockdown impacting production or retail sales in any automotive region during the year,

• Is based on full year average currency rates of 1.15 for USD/€ and 7.50 for CNY/€,

• Includes inflation on raw materials (net impact in 2022 should not exceed that of 2021) and other costs such as wages, transportation and logistics and energy.

FORVIA IS ON TRACK TO DELIVER ON SYNERGIES AND AMBITIONS

On January 31, 2022, Faurecia announced the closing of the HELLA transaction, in line with the indicative timetable.

Faurecia now owns a controlling stake exceeding 80% of the shares of HELLA and will consolidate HELLA in its financial accounts as from February 1, 2022.

As a result of the transaction and as mentioned earlier, the Hueck and Roepke Family pool received 13,571,385 newly issued shares of Faurecia, thus becoming Faurecia’s main shareholder with c. 9% of its share capital.

The Family pool agreed to be subject to a first lock-up of its Faurecia shares during 18 months as from the closing date and a subsequent lock-up of 12 additional months for the portion of its Faurecia shares exceeding 5% of the Faurecia share capital.

At the next shareholders’ meeting, Dr Jürgen Behrend, a former HELLA CEO, will be proposed to join Faurecia’s Board of Directors as a representative of the Family pool, underlining its strong commitment to the combined Group’s strategy and outlook.

On February 7, 2022, Faurecia launched FORVIA, the new company name combining Faurecia and HELLA, representing the 7^th largest automotive technology supplier.

As detailed in a press release issued on that day, FORVIA will be structured around six Business Groups with leading positions, all with full accountability, consolidating Product Lines and Regional Divisions.

Five of them, “Seating”, “Interiors”, “Clean Mobility”, “Electronics” and “Lighting”, have sales already exceeding 3 billion euros while the newly-created “Lifecycle Solutions” will grow this segment to a leading position.

“Seating”, “Interiors”, “Clean Mobility” will be based in Nanterre (France) and “Electronics”, “Lighting” and “Lifecycle Solutions” will be based in Lippstadt (Germany).

Global support functions will be deployed at Group, Business Group, Product & Business Division and Plant levels.

FORVIA will provide customers with an offer of high technology products and solutions that is organized around 24 differentiating Product Lines and address all the automotive industry megatrends.

FORVIA is on track to deliver on synergies and ambitions.

Cost synergies identified during the pre-closing phase (between August 14, 2021 and January 31, 2022) are now upgraded to above €250 million EBITDA run-rate (vs. above €200 million announced on August 14, 2021) with a P&L impact ramping up from 40% in 2023 to 80% in 2024 and 100% in 2025.

On top of these cost synergies, revenue synergies are expected between €300m and €400m of sales by 2025 and cash-flow optimization is expected to generate around €200m per year on average from 2022 to 2025.

FORVIA’s ambition for 2025 and deleveraging trajectory (as announced on August 14, 2021) are fully confirmed:

• 2025 sales above €33 billion

• 2025 operating margin exceeding 8.5% of sales

• 2025 net cash flow of c. €1.75 billion

• Net-debt-to-EBITDA ratio at 1x at year-end 2025

As mentioned earlier, full-year 2022 guidance for the combined Group (Faurecia’s accounts consolidating HELLA for 11 months as from February 1, 2022) should be released along with Q1 sales figures, on April 28, 2022.

A Capital Markets Day will be held in H2 2022 that will provide a strategic presentation and detailed financial perspective for FORVIA until 2025.

Faurecia’s financial presentation and financial report will be available at 9:30am today (Paris time) on the Faurecia website: www.faurecia.com

A webcast will be held today at 10:00am (Paris time). If you wish to follow the presentation using the webcast, please access the following link: https://www.sideup.fr/webcast-faurecia-annual-results-2021/signin/en

A replay will be available as soon as possible. You may also follow the presentation via conference call:

• France: +33 (0)1 70 72 25 50

• United Kingdom: +44 (0) 330 336 9125

• United States: +1 323-994-2093

Confirmation code: 1107023

Financial calendar

April 28, 2022: Q1 2022 Sales (before market hours)

June 8, 2022: Annual Shareholders’ Meeting

July 25, 2022: H1 2022 Results (before market hours)

October 21, 2022: Q3 2022 sales (before market hours)

About Faurecia

Founded in 1997, Faurecia has grown to become a major player in the global automotive industry. With 266 industrial sites, 39 R&D centres and 114,000 employees in 35 countries, Faurecia is a global leader in its four areas of business: seating, interiors, Clarion Electronics and clean mobility. The Group’s strong technological offering provides carmakers with solutions for the cockpit of the future and sustainable mobility. In 2020, the Group reported total turnover of €14.7 billion. Faurecia is listed on the Euronext Paris market and is a component of the CAC Next 20 index. www.faurecia.com

About FORVIA

FORVIA comprises the complementary technology and industrial strengths of Faurecia and HELLA. With over 300 industrial sites and 77 R&D centers, 150,000 people, including more than 35,000 engineers across 40+ countries, FORVIA provides a unique and comprehensive approach to the automotive challenges of today and tomorrow. Composed of 6 business groups with 24 product lines, and a strong IP portfolio of over 14,000 patents, FORVIA is focused on becoming the preferred innovation and integration partner for OEMS worldwide. FORVIA aims to be a change maker committed to foreseeing and making the mobility transformation happen. www.forvia.com

DISCLAIMER

This presentation contains certain forward-looking statements concerning Faurecia. Such forward-looking statements represent trends or objectives and cannot be construed as constituting forecasts regarding the future Faurecia’s results or any other performance indicator. In some cases, you can identify these forward-looking statements by forward-looking words, such as “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “objective”, “believe,” “forecast,” “foresee,” “likely,” “may,” “should,” “goal,” “target,” “might,” “would,”, “will”, “could,”, “predict,” “continue,” “convinced,” and “confident,” the negative or plural of these words and other comparable terminology. Forward looking statements in this document include, but are not limited to, financial projections and estimates and their underlying assumptions including, without limitation, assumptions regarding present and future business strategies (including the successful integration of Hella within the Faurecia Group), expectations and statements regarding Faurecia’s operation of its business, and the future operation, direction and success of Faurecia’s business..

Although Faurecia believes its expectations are based on reasonable assumptions, investors are cautioned that these forward-looking statements are subject to numerous various risks, whether known or unknown, and uncertainties and other factors, including the ongoing global impact of the COVID-19 pandemic outbreak and the duration and severity of the outbreak on Faurecia’s business and operations, all of which may be beyond the control of Faurecia and could cause actual results to differ materially from those anticipated in these forward-looking statements. For a detailed description of these risks and uncertainties and other factors, please refer to public filings made with the Autorité des Marchés Financiers (“AMF”), press releases, presentations and, in particular, to those described in the section 2.” Internal Controls & Risk Management” of Faurecia’s 2019 Universal Registration Document filed by Faurecia with the AMF on April 30th, 2020 under number D. 20-0431 (a version of which is available on www.faurecia.com).
Subject to regulatory requirements, Faurecia does not undertake to publicly update or revise any of these forward-looking statements whether as a result of new information, future events, or otherwise. Any information relating to past performance contained herein is not a guarantee of future performance. Nothing herein should be construed as an investment recommendation or as legal, tax, investment or accounting advice.

The historical figures related to Hella included in this presentation have been provided to Faurecia by Hella within the context of the acquisition process. These historical figures have not been audited or subject to a limited review by the auditors of Faurecia. Hella remains a listed company. For more information on Hella, more information is available on www.hella.com.

This presentation does not constitute and should not be construed as an offer to sell or a solicitation of an offer to buy Faurecia securities.

APPENDICES

DEFINITIONS OF TERMS USED IN THIS DOCUMENT

1. Sales growth

Faurecia’s year-on-year sales evolution is made of three components:

• A “Currency effect”, calculated by applying average currency rates for the period to the sales of the prior year,

• A “Scope effect” (acquisition/divestment),

• And “Growth at constant currencies”.

As “Scope effect”, Faurecia presents all acquisitions/divestments, whose sales on an annual basis amount to more than €250 million.

Other acquisitions below this threshold are considered as “bolt-on acquisitions” and are included in “Growth at constant currencies”.

In 2021, there was no effect from “bolt-on acquisitions”; as a result, “Growth at constant currencies” is equivalent to sales growth at constant scope and currencies also presented as organic growth.

1. Operating income

Operating income is the Faurecia group’s principal performance indicator. It corresponds to net income of fully consolidated companies before:

• Amortization of intangible assets acquired in business combinations;

• Other non-recurring operating income and expense, corresponding to material, unusual and non-recurring items including reorganization expenses and early retirement costs, the impact of exceptional events such as the discontinuation of a business, the closure or sale of an industrial site, disposals of non-operating buildings, impairment losses recorded for property, plant and equipment or intangible assets, as well as other material and unusual losses;

• Income on loans, cash investments and marketable securities; Finance costs;

• Other financial income and expense, which include the impact of discounting the pension benefit obligation and the return on related plan assets, the ineffective portion of interest rate and currency hedges, changes in value of interest rate and currency instruments for which the hedging relationship does not satisfy the criteria set forth in relationship cannot be demonstrated under IFRS 9, and gains and losses on sales of shares in subsidiaries;

• Taxes.

1. Net cash-flow

Net cash-flow is defined as follow: Net cash from (used in) operating and investing activities less (acquisitions)/disposal of equity interests and businesses (net of cash and cash equivalents), other changes and proceeds from disposal of financial assets. Repayment of IFRS 16 debt is not included.

1. Net financial debt

Net financial debt is defined as follow: Gross financial debt less cash and cash equivalents and derivatives classified under non-current and current assets. It includes the lease liabilities (IFRS 16 debt).

IFRS 5 – Discontinued Operations

On February 18, Faurecia announced that it had signed a Memorandum of Understanding for the sale of its AST (Acoustics and Soft Trim) division and all conditions are met to qualify this activity as discontinued, in compliance with IFRS 5.

Therefore, Group figures in 2021 exclude the AST sales and previous periods are restated and presented accordingly.

This restatement impacts only:

• Interiors, as regards Business Groups,

• Europe, as regards regions.

Profit and Loss Statement

*Restated for IFRS 5

Cash Flow Statement

*Restated for IFRS 5

** Not restated for IFRS 5 (Opening balance sheet as of January 1, 2020 was not restated for IFRS 5)

NET CASH FLOW RECONCILIATION

*Restated for IFRS 5

OPERATING LEVERAGE CALCULATION

*Restated for IFRS 5

Attachment

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