Goodyear Tire & Rubber Co is confident of reaching its growth target this year even though sales in the first half were down 6 per cent from the same period last year.
“We delivered record second-quarter results, driven by strong consumer replacement volumes in all of our regions where our new products are in demand,” said Richard Kramer, chairman and chief executive officer.
Its performance in the first half, achieved through a balance of volume growth and cost reduction, gives the company confidence that its strategy is working and it is back on track to attain its 2014-2016 financial targets, he said.
Goodyear’s global second-quarter sales were US$4.7 billion (Bt150 billion), compared with $4.9 billion a year ago. Tyre unit volumes totalled 40.6 million for the quarter, up 3 per cent year on year. Replacement tyre shipments were up 6 per cent, with growth in all four of the company’s sales regions.
The firm reported record segment operating income of $460 million in the second quarter. This was up 7 per cent from the year-ago quarter driven by significant improvement in Europe, the Middle East and Africa, which more than offset softness in emerging markets.
Goodyear’s record second-quarter net income available to common shareholders was $213 million (76 cents per share). Excluding certain items, adjusted net income was $225 million (80 cents per share).
For the second quarter of 2013, net income available to common shareholders was $181 million (67 cents per share). Excluding certain items, adjusted net income was $209 million (76 cents per share). Per-share amounts are diluted.
Goodyear’s sales for the first six months of this year were $9.1 billion, down 6 per cent from the 2013 period. Tyre unit volumes totalled 80.6 million for the first half of 2014, up 2 per cent from 2013. Replacement tyre shipments were up 4 per cent. Original-equipment unit volume was down 3 per cent.
The company’s first-half segment operating income of $833 million was up 14 per cent from last year and a record. Compared with the prior year, year-to-date segment operating income reflects volume and earnings growth in North America and Europe, the Middle East and Africa, which offset lower earnings in emerging markets.
Goodyear’s year-to-date net income available to shareholders of $155 million (58 cents per share) is down from $206 million (79 cents per share) in 2013’s first half.
North America’s second-quarter 2014 sales dropped 7 per cent from last year to $2 billion. Sales reflect a 3-per-cent rise in tyre unit volume, offset by lower third-party chemical sales and lower price mix. Replacement tyre shipments were up 6 per cent. Original-equipment unit volume was down 4 per cent.
Second-quarter segment operating income of $208 million was a 2-per-cent improvement over the prior year and a record for any quarter.