Nokian expects recovery after Q2 sales decline

NOKIAN, Finland—Nokian Tyres P.L.C. has reported a 12-percent year-on-year decline in second quarter sales to $324 million (€293 million), largely due to lower passenger car tire volumes.

Earnings (segments operating profit) for the period to June 30 turned positive at $16.6 million, up from about $946,000 the year before and a loss of $15.4 million the previous quarter.

Over the first six months, sales dipped 19 percent year-on-year to $586 million, while segments operating profit fell 97 percent $1.2 million—again reflecting lower volumes.

In addition to "demanding" car and tire markets, Nokian "faced some currency headwinds, impacting its net sales negatively," according to President and CEO Jukka Moisio.

"We expect the second half of 2023 to be stronger due to winter and all-season tire sales and contribution from contract manufacturing," Moisio added in the July 21 report.

During the second quarter, he noted, Nokian progressed its investments in new capacity, including the start of building work on its new passenger car tire factory in Romania.

For full-year 2023, Nokian's financial guidance has remained unchanged, with sales expected to come in at between $1.4 billion and $1.6 billion.

Nokian said it expects a segments operating profit percentage of net sales of 6-8 percent, noting "that due to seasonality, the segments operating profit will be generated in the second half."

As of 2023, segments net sales and segments operating profit exclude Russia and other items, which are not indicative of Nokian Tyres' underlying business performance, according to the tire maker.