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PARIS, April 23 (Reuters) - Europe's largest listed car parts maker Valeo posted a forecast-lagging 10 percent rise in first-quarter net profit on Wednesday as tough cost-cutting helped it resist a wobbly European car market.
Valeo said in a statement that net profit in the first three quarters climbed to 22 million euros from 20 million previously, while operating profit rose to 109 million from 98 million, for an operating margin of 4.5 percent, up from 3.8 percent.
The bottom line lagged forecasts by six analysts polled by Reuters, who predicted net profit of 37 million euros ($40.35 million), but operating profit of 114 million euros.
Sales dipped four percent to 2.44 billion euros but edged up 1.5 percent at constant exchange rates.
Valeo said sales of its windscreen wipers, headlights, hi-tech parking gadgets and other car parts outpaced the market in Europe and Asia but not in North America, where it is still turning around a loss-making subsidiary.
The Paris-based firm said it had reduced the number of its industrial sites by eight during the first three months of the year as it reined in activity in line with lower car production.
"The group thus has the means to continue to progress in 2003," it said in a statement, giving no firm forecasts for the year.
Valeo said its order intake in the first quarter represented three times sales, reinforcing "the internal growth prospects of Valeo".
Belt tightening at the firm pulled the firm back to profit in 2002 after problems at its U.S. Rochester unit pounded it to a loss the previous year, and the firm has pledged further gains this year.
Chairman Thierry Morin, who spearheaded the firm's turnaround plan, has said that an operating margin of six percent in 2003, compared to five percent last year, would be "a good target", but he does not necessarily expect revenues to grow this year.
Most analysts doubt Valeo will swell its margin to six percent, but still expect it to improve on last year's figure.
Valeo is one of the first firms in the auto sector to report first-quarter numbers.
Valeo stock has underperformed the European DJ Stoxx autos index by around 15 percent so far this year. It ended at 24.14 euros on Tuesday.
Its smaller rival Faurecia said earlier this month its sales had jumped eight percent in the first three months of 2003 and confirmed a goal to boost its operating margin quarter on quarter this year, despite a faltering car market.