TRELLEBORG, Sweden (July 24, 2009)—Swedish rubber product maker Trelleborg A.B.'s earnings fell 73.4 percent in the second quarter on 17.5-percent lower sales, and management cautioned shareholders that a “sense of uncertainty regarding future demand remains great.”
The Trelleborg-based company reported 52.8 percent lower operating profits of $20.5 million and net income of $5.94 million in the three months ended June 30. Sales slid to $886.1 million.
For the half year, operating and net income both fell 77 percent to $26.6 million and $14.3 million, respectively, while sales of $1.77 billion came up 16.2 percent shy of the 2008 period.
Trelleborg Wheel Systems, the firm's tire and wheel unit, reported a slightly better quarterly income performance, but revenue plunged 20 percent in the quarter on “significantly lower” sales of industrial tires, the result of a weak industrial economy globally.
For the quarter, operating profit was down 24.5 percent to $10.7 million on sales of $100.9 million. For the six months, earnings fell 15.5 percent to $23.9 million on 10.7-percent lower sales of $223.5 million.
Trelleborg attributed the relatively small earnings decline to lower volumes and said the operating margin was in line with that of 2008 due to a favorable product and price mix and lower costs.
Trelleborg ceased production of industrial tires at its Hartville, Ohio, plant in the first quarter and is in the process of relocating that capacity to expanded facilities in Sri Lanka. That capacity will be brought on stream throughout the third and fourth quarters.