Forvia Reports Steady Sales Growth Amid Market Challenges

Forvia reported H1 2025 sales of €13.48 bn , a slight decrease of 0.4% year-on-year, but a 1.1% increase when adjusted for constant currencies, indicating modest organic growth driven by the Electronics and Seating segments. Geographic performance varied, with Europe and Asia showing resilience, while the Americas faced challenges, including a 5.1% 1H25 sales decline due to tariffs and reduced tooling sales. Adjusted EBITDA rose to €1.76 bn , reflecting effective cost management and operational efficiencies. Free cash flow improved significantly to €418 mn , supported by disciplined cash management and a 35% reduction in capital expenditures. Besides, the net debt decreased to €6.43 bn , enhancing the firm's financial health with a net debt to EBITDA ratio of 1.8x. Forvia confirmed its FY 2025 sales guidance of €26.3 bn to €27.5 bn , focusing on restructuring and divesting non-core assets to drive future growth, while addressing potential risks from tariffs. Based on these positive numbers, despite the challenging market context, along with increased visibility on tariffs and management's confidence in their ability to execute asset disposals, we are changing our view from underweight to market weight . …