Six companies with diverse business strategies but strong investor returns are winners of the annual Automotive News Europe Price-waterhouseCoopers Total Shareholder Value awards.
The car manufacturer winners for total shareholder value returns over one-year and three-year periods, for example, are luxury specialist Porsche and mass-marketer PSA/Peugeot-Citroen.
Both companies and winners representing automotive suppliers and retailers will be honored at the gala dinner Monday, June 25 at the Automotive News Europe Congress in Gothenburg, Sweden.
Porsche shares gained 40 percent in value over one year, amid expectations that last year's record profit and sales will be surpassed in 2002. There is no slowdown in the pace of Porsche's investments. The company will spend 100 million on a new engine plant at its Stuttgart-Zuffenhausen site, to be completed at the end of 2003 with a capacity of over 80,000 units a year. And Porsche may double production of the new Cayenne sport-utility to 50,000 a year.
PSA shares returned 160 percent over the past three years. With its Peugeot and Citroen brands releasing similar-sized but complementary cars with shared components in key segments every three to four years, PSA sales are less volatile than for rivals Fiat and Renault.
'It shows that carmaking remains a product-led business,' said Philip Wylie, automotive director at PricewaterhouseCoopers Corporate Finance. 'Good products make good profits and good profits make good returns for shareholders.'
Two German companies lead in the supplier category. The one-year winner is Leoni, with a 47.6 percent return on shareholder value. So successful is this cable and wiring systems maker that its shares are being promoted to the German stock market's MDAX index for medium-sized companies from the small-company SDAX index.
Leoni's total sales are about 1 billion. It expects sales to reach 1.7 billion by 2005.
Beru is the best shareholder value performer over three years with a total return of 180 percent. As a leader in components such as the glow plug, it has benefited from consumer demand for diesels.
Beru has wider ambitions. It recently acquired a 70 percent stake in F1 Systems, a UK maker of Formula One racing components, in a move into sensors and electronics.
'Beru is very technology-oriented,' Wylie said. 'Leoni, which deals with simpler products, moved production to eastern Europe where labor costs are cheaper.'
Shares in Ryland Group, which operates 40 dealerships in the UK, returned 75.94 percent over 12 months. Shares rose on speculation of a takeover bid as retailers seek to grow to take full advantage of the planned liberalization of car distribution in Europe.
Ryland's operating profit rose 65 percent to £7.5 million (11.6 million) in 2001, up from £4.5 million in 2000. Vehicle sales volume last year increased 7 percent from the previous record in 2000.
Inchcape returned 194.26 percent over three years with pre-tax profits rising 32 percent to £97.9 million on strong international growth, exceeding stock analysts' expectations.
Further improvements are forecast this year and beyond, particularly in Greece, Belgium, the UK and the Asia Pacific.
Last December, Inchcape paid 12.9 million for the 51 percent of Eurofleet that it did not already own.
Eurofleet is a leading UK provider of automotive logistic services.