MILAN, Italy (Nov. 10, 2010)—Pirelli Tyre S.p.A. reported gains in operating and net income in the third quarter as sales nearly equalled those of the 2008 period.
Pretax operating income before restructuring charges jumped nearly 55 percent to $207.3 million as sales hit $1.52 billion. Net income more than quintupled to $52.6 million.
Pirelli attributed the earnings improvement to a decline in raw materials costs, the focus on price/mix, actions for greater competitiveness and a recovery in the market, accompanied by sales growth at higher rates than the market in all areas.
Revenues for the nine months ended Sept. 30 amounted to $4.32 billion, down 4.5 percent from the 2008 period. Pretax operating income for the year to date was up 1.2 percent to $558.8 million, improving the profit ratio a full point to 12.9 percent.
Pirelli reported sales in its consumer business rose 3.1 percent to $1.07 billion on improved replacement market demand and smaller-than-expected declines in OE sales. Sales for the nine-month period were down 4.5 percent to $3.08 billion.
Industrial business sales fell 12.2 percent in the quarter to $447.7 million and 16.7 percent for the year to date to $1.24 billion.
Pirelli said the industrial segment is more cyclical because it is linked to macro-economic performance, thereby accounting for lower tire and steelcord sales.