PARIS—Revenue and operating income increased for Michelin as the French tire maker released its half year financial results on July 28.
Revenue increased 8.5 percent to $11.6 million, and operating income increased 9 percent to $1.4 million, compared to the first half of 2014, according to Michelin.
The company expects tire demand to be more challenging in new markets for the second half of 2015, while predicting mature regions will continue to grow.
Michelin said its objective for the second half is to pursue growth trends observed in the first six months and predicted that changes in price mix and raw materials prices were expected to have a net negative effect on the businesses over the full year.
“As expected, changes in price mix and raw materials prices had a net negative effect, reflecting in particular the contractual price adjustments under raw materials-based indexation clauses, and managed price repositionings,” the company said in a news release.
In the first half, volumes rose 2.4 percent, said Michelin adding that the company had outperformed the market.
“Passenger car/light truck tire sales clearly outpaced the market, (while) truck tire and specialty business volumes were slightly better than their markets,” Michelin said.
On consecutive quarterly result, Michelin said that changes in price mix and raw materials prices had a net negative effect in the second quarter.
“The success of our most recent lines, such as the Michelin CrossClimate and the new BF Goodrich tires, as well as our strengthened positions in the original equipment segment, confirm the importance of innovation for the group's growth. Combined with the expected deployment of the competitiveness plan, Michelin can confirm its full-year guidance,” CEO Jean-Dominique Senard said in a news release.
The group confirmed its target of delivering an increase in operating income before non-recurring income excluding the currency effects, a return on capital employed in excess of 11 percent, and structural free cash flow of more than $773 million, while pursuing a capital expenditure program totaling around $2 billion.