HANOVER, Germany (Aug. 1) — Based on double-digit growth in first-half sales and earnings, Continental A.G. management is brimming with confidence for the remainder of fiscal 2007.
"This strong half-year performance gives us a rock-solid basis for yet another peak year," said Chairman Manfred Wennemer. "And, at the same time, the figures for the divisions prove that our strategic direction as a broad-based automotive supplier is successful and absolutely correct."
Pre-tax earnings jumped 26.2 percent to $1.25 billion while sales climbed 10.8 percent to $11 billion, raising the earnings to sales ratio one and a half points to 11.4 percent. Net income surged 35.4 percent to $788.8 million.
Conti´s tire businesses reported 62-percent higher pre-tax earnings and 4.5-percent better sales over the first half of 2006 on improved consumer tire sales in Europe and the Americas and commercial tire sales in Europe.
The passenger/light truck tires division reported a 63.8-percent surge in pre-tax earnings to $490.3 million as sales rose 6.5 percent to $3.29 billion. The earnings rise came despite nearly $62 million in expenses related to the restructuring of the unit´s operations in Charlotte, N.C.
The commercial vehicle tires unit´s sales fell 1.8 percent in the period to $971.3 million, but the drop is attributed to a change in the scope of consolidation, which shifted some commercial tire unit sales to the passenger/light truck tire division. Division pre-tax earnings rose 31.9 percent to $80.2 million, raising the return on sales two full points to 8.3 percent.