Trelleborg Wheel reports double-digit Q4 sales, earnings

TRELLEBORG, Sweden—Trelleborg Wheel Systems reported double-digit sales and earnings growth for the quarter and fiscal year ended Dec. 31 on strong business in both the original equipment and replacement sectors.

Trelleborg Wheel Systems, the Tivoli, Italy-based industrial and agricultural tire and wheel subsidiary of Sweden's Trelleborg A.B., reported higher sales in the second half of the year versus the first six months.

Despite the strong growth in all tire categories and most geographies, Trelleborg said the segment's profitability was hampered by "continued price rises for raw materials and freight and particularly by the accelerating energy costs."

For the year, Trelleborg Wheel reported 15.6 percent higher pre-tax operating income (EBIT) of $141.5 million on 15 percent higher sales of $1.17 billion. In the fourth quarter, EBIT rose 22.2 percent to $32 million on 26 percent higher sales of $321 million.

The fiscal 2021 earnings ratio was unchanged at 12 percent.

Trelleborg Wheel's business in North improved to $199 million, or 17 percent of the unit's global revenue.

Trelleborg does not break down its revenue between wheels and tires.

Sales increased in all major regions as well as the firm's key business categories of tires for agricultural machinery and materials-handling and off-highway vehicles. The group said it expects price adjustments implemented for customers, as well as continued demand to lead to improved profitability in future quarters.

Trelleborg at this time declined to comment further on a possible divestment of the tire and wheel business, referring to its statement of late December that external parties have shown interest in acquiring the Trelleborg Wheel Systems business area and early-stage discussions are ongoing.

Overall, 2021 turned out to be Trelleborg A.B.'s best year ever, according to President and CEO Peter Nilsson, as the company reported $600 million in EBIT on 15.5 percent higher sales of $3.95 billion.

"We delivered healthy organic growth and improved profitability, despite challenges in the form of increased inflation pressure and growing imbalances in the supply chain," Nilsson said.