MILAN, Italy (March 13) — Pirelli Tyre S.p.A. expects operating earnings and sales to improve this year over the 2006 results, which in turn were improved over 2005 despite high raw material costs.
Pirelli Tyre, an operating unit of Pirelli & C. S.p.A., reported 3.8-percent higher pre-tax operating earnings of $669.6 million on 8.7-percent better sales of $4.96 billion.
Pirelli Tyre credited improved business in both its consumer and industrial segments for the sales growth. Sales of consumer tires, which represent 69 percent of the firm's revenues, grew 8 percent during the year to $3.43 billion, while the commercial tire segment recorded 9-percent growth to $1.52 billion.
Operating income in the consumer business was up 22 percent to $308.3 million on the positive effects of "commercial variables" and increased efficiencies, which more than compensated for higher raw materials costs.
Operating income in the commercial sector was down from 2005 on the high cost of natural rubber and inability of the business to pass along cost increases to customers, Pirelli said.
Pirelli executives did not quantify their expectations for 2007.