MILAN—Pirelli & C. S.p.A. saw first half earnings (adjusted EBITDA before start-up costs) drop 2.3 percent year-on-year to $517 million, mainly due to a weakness in original equipment demand.
Revenue for the first six months of the year grew about1 percent at $2.86 billion, helped by increases in the high value segment, Pirelli noted in financial results released Aug. 1.
Sales remained positive in all regions apart from Europe, Middle East & Africa, where Pirelli posted a 3.2 percent decline at $1.3 billion.
Pirelli attributed the decline to the fall in premium car production in Europe in the first half.
South America witnessed the largest revenue growth at 8.2 percent to $386 million.
Volumes for the period fell 5 percent, reflecting a 3.9 percent growth in high value segment and a 13.9 percent decline in standard tire segments.
A $112 million improvement of price/mix partially offset the negative impacts of raw materials pricing ($65.8), currency volatility ($5.3) and volume delcines ($63.8).
Industrial efficiencies at $40.4 million more than offset a $39.1 million costs' inflation.
During the period, Pirelli also implemented a $33.6 million cost reduction plan to counter the decline in sales in the standard segment, particularly in Brazil.
This, the company said, helped offset the growing pressure on prices and cover the costs linked to the development of high value products.