FINDLAY, Ohio (Aug. 8, 2011)—Cooper Tire & Rubber Co.'s net income nosedived 71.2 percent to $14.4 million despite a 14.7-percent surge in sales to $922.2 million for the second quarter, ended June 30, compared with the year-ago period.
Cooper attributed the slump in profits to lower sales volumes and raw material costs, among other factors.
For the first half, net income plummeted 51.1 percent to $32.9 million as sales increased 17.3 percent to $1.83 billion.
Cooper's North America Tire Operations' sales rose 16 percent in the quarter to $666.8 million because of stronger price and mix, but was partially offset by decreased unit sales, the company said. Segment profit fell 81.3 percent to 19.6 million.
Light vehicle tire shipments for Cooper's North America segment in the U.S. decreased by 11.9 percent, compared with total industry shipment decreases of 6.8 percent reported by the Rubber Manufacturers Association. Unit sales for Cooper's North American segment fell 8.2 percent.
“This decrease was a result of the company performing below weak industry conditions in April and May. Consumer sentiment was negatively impacted by high gas prices and consumers' reduced tire purchases. Combined with destocking in the supply chain, the result was weak tire shipments for tire manufacturers,” the company said in a statement.
For the six-month period, the North America unit boosted sales 18.8 percent to $1.31 billion while segment profit fell 24.3 percent to $25.2 million.