HANOVER, Germany (Feb. 22) — Continental A.G. in 2006 outperformed its prior earnings and sales, posting a 7.6-percent gain in consolidated revenue and a 5.5-percent increase in net income.
Conti said the achievement makes 2006 the fifth year in a row it has surpassed its prior-year results. The firm added the accomplishment came on the heels of $418.5 million in higher raw material costs.
Conti reported annual sales of $19.7 billion in 2006 as net income grew to $1 billion. Operating income also rose 6.3 percent to $2.12 billion.
In the Passenger and Light Truck Tires division, sales rose 5.6 percent to $6.2 billion, but operating income in the division fell 2.7 percent to $859.4 million. The division´s return on sales also slipped to 13.9 percent from 15.1 percent in 2005.
However, volume was "slightly higher" at 106.3 million tires, and business improved in the North American market.
"We markedly improved the adjusted (earnings before interest and taxes) in the NAFTA region despite the extremely adverse conditions and recorded a significant profit in the replacement business for the second year in a row," said Manfred Wennemer, Continental executive board chairman. He added that further improvement in the passenger and light truck tires business in the NAFTA region depends on raw material costs.
For fiscal 2007, Continental expects to see more improvement in its operating earnings as raw material prices continue to ease.