Skip to main content
Sister Publication Links
  • European Rubber Journal
  • Plastics News
  • Tire Business
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • Best Places to Work
    • Rubber Division IEC
    • War in Ukraine
    • Automotive
    • Tire
    • Non-Tire
    • Suppliers
    • ITEC
    • Silicone
    • Online Exclusive
    • Latex
    • Technical Notebooks
    • Executive Action
    • Government/Legal
    • Opinion
    • Blogs
    • Sustainability
    • Products
    • Wacky World of Rubber
  • Airless Tires
  • Custom
    • Sponsored Content
    • White Papers
  • Resources
    • Directory
    • Classifieds & Mold Mart
  • Data
  • Events
    • RN Events
    • RN Livestreams/Webinars
    • Industry Events
    • Past Events
    • Rubber News M&A Live
    • Ask the Expert
    • Healthcare Elastomers Conference
    • Rubber In Automotive Conference
    • Women Breaking the Mold Networking Forum
  • Advertise
  • DIGITAL EDITION
MENU
Breadcrumb
  1. Home
  2. News
May 18, 2018 02:00 AM

Pirelli's earnings grow in first quarter despite lower sales

Tire Business Report
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print

    MILAN—Pirelli & C. S.p.A. reported solid increases in earnings for the first quarter of 2018 despite slightly lower sales revenue.

    Pirelli's adjusted pre-tax operating income rose 6.5 percent to $353.9 million on 2.2 percent lower sales of $1.65 billion. Pirelli blamed the lower revenue figure on foreign currency exchange losses, citing organic sales growth of 5.7 percent, based on the strength of higher sales in the company's high-value segments.

    The adjusted operating income takes into account nearly $18 million in costs related to start-up programs, such as the conversion of the Aeolus car tire plant in Jiaozou, China, to Pirelli-brand production and the launch of activities such as Cyber and Velo.

    Otherwise, the improvement is linked to the effect of internal levers such as price/mix and efficiencies, which more than offset the increase in raw material costs, cost inflation and other costs linked to business development, Pirelli said.

    The company reported net income of $104.8 million vs. a net loss of $29.3 million in the same period of the previous year.

    Regarding revenue, Pirelli said "high-value" revenues grew 13.4 percent to $1.02 billion, raising the high-value products' share of overall revenue nearly six points to 63.6 percent.

    In particular, Pirelli said sales volumes of larger rim size (above 18 inches) grew 18.6 percent. By contrast, total volumes fell 1.5 percent because of a drop of nearly 11 percent in the standard tire size categories. This trend reflects the decrease of the standard demand in mature markets (Europe, NAFTA and Asia/Pacific) and the decision by Pirelli to accelerate the reduction of volumes on products with lower profitability in these regions plus Latin America.

    Geographically, Russia and Eastern Europe recorded the highest growth at 10.7 percent, followed by Asia-Pacific at 5.8 percent and Europe at 1.3 percent.

    Sales in the NAFTA realm slipped 2.9 percent to $299 million, followed by Middle East/Africa at 9.8 percent and Latin America at 16.7 percent.

    Pirelli is forecasting a full-year improvement in operating profit of about 14 percent over fiscal 2017 on 4.4 percent higher sales, based on organic revenue growth of roughly 9 percent and continued exchange rate volatility.

    Letter
    to the
    Editor

    Rubber News wants to hear from its readers. If you want to express your opinion on a story or issue, email your letter to Editor Bruce Meyer at [email protected].

    Most Popular
    1
    What to expect in ‘rapidly changing' auto industry
    2
    VDMA: EU's PFAS ban 'overshooting the mark'
    3
    Wanli Tire considering Cambodia for overseas tire plant
    4
    R.D. Abbott taps Swanton to lead NovationSi process engineering
    5
    A journey of faith, science and humanity: Chris Macosko wins 2023 Charles Goodyear Medal
    SIGN UP FOR NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Get our newsletters

    Staying current is easy with Rubber News delivered straight to your inbox, free of charge.

    Subscribe Today

    Subscribe to Rubber News to get the best coverage and leading insights in the industry.

    SUBSCRIBE
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter

    MISSION

    To serve companies in the global rubber product industry by delivering news, industry insights, opinions and technical information.

    Contact Us

    2291 Riverfront Pkwy, Suite 1000
    Cuyahoga Falls,
    OH 44221

    Customer Service:
    877-320-1726

    Resources
    • About Us
    • Digital Edition
    • Staff
    • Advertise
    • Order Reprints
    • Privacy Policy
    • Privacy Request
    • Terms of Service
    • Careers
    • Ad Choices Ad Choices
    • Sitemap
    Partner Sites
    • Tire Business
    • European Rubber Journal
    • Plastics News
    • Urethanes Technology
    • Automotive News
    • Crain Brands
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Best Places to Work
      • Rubber Division IEC
      • War in Ukraine
      • Automotive
      • Tire
      • Non-Tire
      • Suppliers
      • ITEC
      • Silicone
      • Online Exclusive
      • Latex
      • Technical Notebooks
      • Executive Action
      • Government/Legal
      • Opinion
      • Blogs
        • Products
        • Wacky World of Rubber
      • Sustainability
    • Airless Tires
    • Custom
      • Sponsored Content
      • White Papers
    • Resources
      • Directory
      • Classifieds & Mold Mart
    • Data
    • Events
      • RN Events
        • Healthcare Elastomers Conference
        • Rubber In Automotive Conference
        • Women Breaking the Mold Networking Forum
      • RN Livestreams/Webinars
      • Industry Events
      • Past Events
      • Rubber News M&A Live
      • Ask the Expert
    • Advertise
    • DIGITAL EDITION