Skip to main content
Sister Publication Links
  • European Rubber Journal
  • Plastics News
  • Tire Business
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • Automotive
    • Tire
    • Non-Tire
    • Suppliers
    • ITEC
    • Silicone
    • Online Exclusive
    • Latex
    • Technical Notebooks
    • Executive Action
    • Government/Legal
    • Opinion
    • Rubber Division IEC
    • Blogs
    • Sustainability
    • Products
    • Wacky World of Rubber
  • War in Ukraine
  • 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
    • 2022 Hose & Belt Manufacturers Conference
    • 2022 International Silicone Conference
    • 2022 International Tire Exhibition & Conference (ITEC)
    • 2022 Women Breaking the Mold
  • Advertise
  • DIGITAL EDITION
MENU
Breadcrumb
  1. Home
  2. Financial
July 30, 2019 09:08 AM

Cooper earnings, sales down slightly for second quarter, half year

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

    FINDLAY, Ohio—Cooper Tire & Rubber Co. reported lower operating income and sales for the quarter and half year ended June 30, and management sees the company facing a challenging economic environment throughout the rest of year.

    Among the headwinds Cooper management sees for the second half are the increased U.S. tariff costs (which impact Cooper's medium truck tires), the delayed timing of anticipated commercial truck tire price increases, and weakness in the China new vehicle and Europe replacement tire markets.

    Despite the first-half results and the headwinds, Cooper said it expects to report an improved operating profit margin throughout the year, matching or exceeding the 5.9 percent reported last year.

    As a result of the changing market conditions, Cooper is adjusting its financial expectations for the full year in a number of areas, including:

    • Given first-half volume performance and the lack of clarity regarding the China new vehicle market, Cooper no longer expects full-year unit volume growth versus 2018;
    • Capital expenditures to range between $180 million and $200 million, not including any capital contributions related to Cooper's pro-rata share of its joint venture with Sailun Vietnam or other potential manufacturing footprint investments;
    • Charges related to the restructuring of the Melksham, England, factory to be in a range of $8 million to $11 million.

    For the quarter ended June 30, Cooper's operating income fell 3.3 percent to $31.7 million on 2 percent lower sales of $679.1 million, for a 4.5 percent earnings ratio. Cooper attributed the earnings drop to costs related to elevated tariffs on products imported into the U.S. from China ($13 million), lower production volumes ($6 million), higher operating and liability costs, as well as $2 million of restructuring costs related to Cooper Tire Europe's decision to cease light vehicle tire production at its Melksham, England, plant.

    Offsetting these costs were $17 million of favorable price and mix and $15 million of favorable raw-material costs.

    Cooper attributed the sales drop to the impact of lower unit volume ($34 million) and unfavorable foreign currency exchange rates ($6 million), partially offset by $21 million of favorable price and mix. Net income plunged 41.2 percent to $8.82 million.

    "Our second-quarter operating profit margin improved sequentially from the first quarter, and the Americas segment delivered improved operating profit despite new and incremental tariffs this year," Cooper President and CEO Brad Hughes said.

    "Our International segment was challenged by the ongoing decline within the new vehicle market in China and a weak replacement tire market in Europe. While we are not satisfied with the lower unit volume in the second quarter, our strategic initiatives are taking hold, and we are confident that they will contribute more meaningfully to unit volume growth in 2020."

    In the Americas business segment, operating profit improved 15.6 percent to $46.8 million on 0.4 percent lower sales of $582.3 million. Cooper attributed the earnings improvement to $22 million in favorable price/mix and $12 million of favorable raw material costs, which more than $13 million in costs related to the China tariffs.

    Sales revenue fell in part due to a 3.8 percent drop in unit sales volume, including a 4 percent decline in passenger/light truck tire shipments in the U.S.

    For the half year, operating income fell 1.9 percent to $58.1 million on 0.1 percent lower sales of $1.3 billion. Net income was off 32.2 percent to $15.8 million.

    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
    Trelleborg to buy Minnesota Rubber and Plastics for $950 million
    2
    Wacky World of Rubber: The true story behind the rubber match
    3
    USTMA offers priorities on 6ppd alternatives study
    4
    Russia’s Sibur breaks silence, says elastomer business remains strong
    5
    Trelleborg Sealing Solutions buys MG Silikon, enhances aerospace offerings
    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
    • Plastics News China
    • Urethanes Technology
    • Automotive News
    • Crain Brands
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • News
      • Automotive
      • Tire
      • Non-Tire
      • Suppliers
      • ITEC
      • Silicone
      • Online Exclusive
      • Latex
      • Technical Notebooks
      • Executive Action
      • Government/Legal
      • Opinion
      • Rubber Division IEC
      • Blogs
        • Products
        • Wacky World of Rubber
      • Sustainability
    • War in Ukraine
    • Custom
      • Sponsored Content
      • White Papers
    • Resources
      • Directory
      • Classifieds & Mold Mart
    • Data
    • Events
      • RN Events
        • 2022 Hose & Belt Manufacturers Conference
        • 2022 International Silicone Conference
        • 2022 International Tire Exhibition & Conference (ITEC)
        • 2022 Women Breaking the Mold
      • RN Livestreams/Webinars
      • Industry Events
      • Past Events
      • Rubber News M&A Live
    • Advertise
    • DIGITAL EDITION