HANOVER, Germany (July 20, 2009)—Continental A.G. returned to the black in the second quarter despite a 28-percent drop in sales, according to preliminary figures.
Continental Executive Board Chairman Karl-Thomas Neumann attributed the turnaround to the “most extensive cost-cutting package in the company's history” and the “rigorous and consistent adaptation” of the company to the difficult market conditions. Conti has cut its employment by 16,000 since September.
For the quarter ended June 30, Conti expects to report pre-tax operating income of $54.6 million on sales of $6.7 billion; for the half, the pre-tax operating result will be a $175.3 million loss on 31.6-percent lower sales of $12.6 billion.
Audited figures for the second quarter and first half will be released July 30.
Neumann cautioned, however, that the second half will be continue to be a challenge for the entire supplier industry.
Conti also released adjusted pre-tax operating income—before amortization of intangible assets, changes in the scope of consolidation and special effects, including severance payments from the worldwide cost-cutting programs in 2009—which show a brighter picture.
Adjusted operating income for the second quarter stood at $393 million.