French auto supplier Faurecia said revenue fell by 7 percent in the third quarter to 3.9 billion euros ($4.62 billion), but the decrease still showed a better result than expected, fueled by strong growth in China.
The molder has upgraded its second-half guidance on sales, profitability and net cash flow, CEO Patrick Koller said in an Oct. 23 statement.
"Our sales in Q3 were better than previously expected. Despite ongoing uncertainty related to the COVID-19, we are now more confident about worldwide automotive production in the second half of the year that should drop only in the mid-single digits vs. the second half of 2019," Koller said in a statement.
Faurecia's sales fell by 19.7 percent in the first quarter, as coronavirus restrictions first affected its China business, and by 50 percent in the second quarter, as lockdowns spread to Europe and North America.
Koller said sales in September were up 1.2 percent compared with the same month in 2019. He said Faurecia was expecting a strong rebound in the next two years, despite continuing uncertainties around the coronavirus pandemic.
For the second half of 2020, Faurecia expects 8 billion euros ($9.5 billion) in sales, versus an earlier forecast of "around 7.6 billion euros" announced in July.
By region, European sales were down 7.9 percent in the third quarter to 1.73 billion euros ($2 billion); North America sales fell 3.3 percent to 1.1 billion euros ($1.3 billion); and Asia sales fell 4.2 percent to 903 million ($1.1 billion) euros, despite the growth in the Chinese market.
PSA Group holds a 46 percent controlling stake in Faurecia. Under the terms of PSA's planned merger with Fiat Chrysler Automobiles, that share will be distributed to shareholders of the merged company, to be called Stellantis, and Faurecia will become a separately listed company.
Faurecia said that the spinoff was likely to be completed by the end of the second quarter of 2021.
Faurecia, which makes seating, interiors, electronics and clean mobility products, ranks among the Top 10 of global auto suppliers, with sales of $19.9 billion in 2019.
Its North American operations were No. 58 in the most recent Plastics News ranking of injection molders.