FINDLAY, Ohio (Nov. 2, 2012)—Cooper Tire & Rubber Co. reported record net sales of $1.1 billion for the third quarter, an increase of $47 million—or 4 percent—compared to the same period a year ago.
The Findlay-based tire maker's operating income for the quarter also hit a record $130 million, which it said is $82 million higher than third quarter 2011 and 11.8-percent of net sales.
Cooper said third quarter profits were positively impacted by lower raw material costs of $144 million, volume increases totaling $9 million and $7 million in manufacturing efficiencies. These contributing factors were also noted in the company's second quarter 2012 financial report.
However, profit contributors were partially offset by $36 million in unfavorable price and mix, $28 million in higher selling, general and administrative costs to invest in the company's expanding distribution networks and promoting the company's brands, according to Cooper. The company also saw $7 million in higher product liability costs and $7 million in "other" costs—which included higher pension expenses, higher incentive compensation costs, resulting from higher profits, affected selling, general and administrative costs and other costs, the firm said.
Cooper CEO Roy Armes said the third quarter financial results included several record performances for the company, and he chalked that up to its initiatives to improve efficiency, which helped lower costs while the company—along with the industry—benefitted from lower raw material costs.
"Total global volume grew by 5 percent," he said. "Once again, our U.S. volumes grew while the overall industry declined. We believe our ability to outpace the industry is attributable to strong execution of our strategic plan, especially our focus on new product introductions that are positioning Cooper as the consumer choice for performance and value."
Cooper ended the third quarter with $272 million in cash and cash equivalents, which is an increase of $181 million compared with the 2011 third quarter balance of $91 million. The company attributed improved profits and lower working capital to its higher cash balance.
A summary presentation of Cooper's third-quarter financial information is posted on the company's website.