AKRON (March 17)—Goodyear reported its first profitable year since 2001, recording net income of $114.8 million in 2004, compared with a loss of $807.4 million a year earlier.
The company set a record with net sales for the year of $18.4 billion, 21.9 percent higher than in 2003.
Goodyear´s North American Tire division also was profitable, recording operating earnings of $31.5 million in 2004 compared with a loss of $130.9 million in 2003. Sales rose to $7.85 billion for the year, up 16.4 percent from 2003.
Tire unit volume for North America Tire grew to 25.5 million from 24.5 million for the quarter and to 102.5 million units from 101.2 million for the year.
For the fourth quarter, Goodyear posted record sales of $4.83 billion, up 23.5 percent, and net income of $124.6 million vs. a loss of $427 million in 2003 after income taxes.
The North American Tire unit in the fourth quarter posted sales of $2.02 billion vs. $1.67 billion a year earlier. The division also reported segment operating income of $15.8 million compared with a loss of $14.7 million.
Akron-based Goodyear said the improvement in its overall annual results where boosted by a fourth quarter after-tax gain of $156.6 million from an insurance settlement, among other positive benefits.
The tire maker said the company's results are highly dependent on the North American Tire segment, which contributed about 43 percent of consolidated net sales in 2004, according to the company's 10-K filing. Goodyear said the improvement resulted primarily from better pricing and a shift in product mix to more profitable Goodyear-brand tires.
Still high legacy costs to North American retirees led NAT to contribute just 2.9 percent of total segment operating income though it accounted for 41 percent of total segment sales.
Total segment operating income in the fourth quarter from the company's business units grew 56 percent to $271 million. For the year, total segment operating income more than doubled to $1.1 billion.