HANOVER, Germany (March 3, 2011)—Continental A.G. said it could grow as much as 10 percent this year, based on business so far in 2011 and after recording sales growth of nearly 30 percent and an earnings ratio of nearly 10 percent in fiscal year 2010.
Sales last year grew 29.6 percent to $34.5 billion and pretax operating income more than doubled to $4.75 billion, or 13.8 percent of sales. Net income reached $762.9 million, reversing a billion-plus dollar loss in 2009.
Conti's Rubber Group—which includes the passenger/light truck and commercial truck tire divisions—reported a 66.2-percent improvement in pretax operating income to $2.45 billion on 25.8-percent better sales of $13.4 billion.
“We want to achieve our 2010 adjusted sales margin of 9.7 percent again in 2011,” said Conti CEO Elmar Degenhart, despite “dramatic price increases” in raw materials, especially natural rubber, that will result in a nearly $1 billion impact on the bottom line. Conti is basing it optimistic growth project in part on a forecast of sales of 75 million cars this year worldwide.
Degenhart said Conti will support its ambitious growth plans with capital spending this year of about $2 billion. Conti invested more than $1.7 billion last year.