Trelleborg Q1 sales, earnings drop amid lower volumes

TRELLEBORG, Sweden—Trelleborg Group has reported a decline in first quarter sales and pre-tax earnings (EBITDA), due to lower volumes.

Volumes were impacted during the three months to end of March, due to Easter holidays, which led to fewer working days, group President and CEO Peter Nilsson said on April 24.

Earnings for the quarter fell 2 percent year-on-year to $118 million on 5-percent lower sales of $1 billion. Despite the earnings decline, Trelleborg said earnings margin improved to 18.1 percent from 17.5 percent reported the year before.

According to Nilsson, Trelleborg has noted "subdued performance" in several market segments for the past several quarters and has adapted itself to lower demand.

"We, therefore, see it as a sign of strength that we were able to display a margin improvement despite lower volumes during the quarter," Nilsson added.

For the long-term, he said, the group aims to improve its structure to achieve a margin of 20 percent.

Breaking down segments, Nilsson said sales for Trelleborg Industrial Solutions (TIS) slowed somewhat.

Segment revenue declined 3 percent year-on-year to $352 million, while earnings rose 9 percent to $58.4 million.

Nilsson said the construction industry "remains under pressure in several markets", while the group has also noted weaker demand in certain industrial segments.

Meanwhile, sales to the automotive industry were positive.

Nilsson linked the improvement in segment earnings and margin to "operational and structural improvements as well as a positive sales mix."