HANOVER (Nov. 1) — Continental A.G. reported an 8.2-percent sales gain for the third quarter to $4.71 billion as management reiterated its outlook for earnings gains this year.
"We have done well in a tough environment, and as announced, our sales and EBIT (earnings before interest and taxes) will exceed the record levels of 2005," said Manfred Wennemer, executive board chairman for Continental.
EBIT fell 12.5 percent in the quarter to $500 million and 1.8 percent for the nine months to $1.42 billion on one-time charges, Continental said. Increased raw material prices also reduced EBIT in the nine months by about $294.4 million compared with prices for the same period in 2005.
Continental said its quarterly EBIT was "nearly on par" with the adjusted figures for the same period in 2005.
In the passenger and light truck tires division, sales rose 1.3 percent to $1.46 billion in the quarter as EBIT fell 51.5 percent to $143.5 million. For the nine months, sales in the division rose 5.5 percent to $4.3 billion as EBIT fell 32.4 percent to $412.4 million, in part from one-time effects.
Though the number of tires sold to the NAFTA replacement market was down, sales in that segment "improved markedly," Continental said. Before one-time effects in the nine-month period, EBIT in the PLT division improved 2.2 percent to $11.2 million, the tire maker said.
In North America, Continental said its restructuring measures at its Charlotte, N.C., plant—where it ceased tire production—resulted in expenses of $66.7 million for the first nine months of the year. Plans to close its Mayfield, Ky., plant also led to charges of $35.7 million.
Continental said it will continue restructuring efforts in North America in the fourth quarter, including reduced benefits for retirees. Conti said the efforts should positively impact EBIT in the fourth quarter by more than $95.2 million.