Goodyear projects 12% operating income growth
Goodyear Tyre and Rubber Co expects to achieve segment operating income of US$1.4 billion (about Bt45 billion) to $1.5 billion in 2013, an increase of more than 12 per cent over 2012 and a record. The company's current expectation is below its previously announced target for total segment operating income of $1.6 billion.
Goodyear continues to expect long-term growth in the global tyre industry but at a slower pace near-term than previously forecast. The company expects that its full-year tyre unit volume for 2013 will reflect a low single-digit percentage growth rate compared to 2012.
Goodyear is one of the world's largest tyre companies. It employs about 69,000 people and manufactures its products in 52 facilities in 22 countries including Thailand. Goodyear's two Innovation Centres, in Akron, Ohio and Colmar-Berg, Luxembourg, strive to develop state-of-the-art products and services that set the technology and performance standard for the industry, the firm said.
The company's chairman and chief executive officer, Richard J Kramer, said that its 2012 performance marks the second consecutive year it exceeded $1.2 billion in segment operating income in a low-volume environment.
"These results have been driven by North American Tyre's performance, which has momentum and, more importantly, sustainability," he added.
In addition, the company is beginning to see the benefits of the strategic investments it is making in China, Kramer said.
"We feel very positive about the progress made in our North American, Latin American and Asia-Pacific businesses in 2012 and are confident in our ability to continue delivering improved profitability," he said.
Goodyear's 2012 annual sales were $21 billion, down 8 per cent from $22.8 billion a year ago. Sales reflect strong price/mix performance, which drove revenue per tyre up 8 per cent year-on-year, excluding the impact of foreign currency translation. Unfavourable unit volume and foreign currency translation reduced sales by $1.6 billion and $766 million, respectively. Lower sales in other tyre related businesses, most notably third-party chemical sales in North America, reduced 2012 sales by $489 million.
The company's segment operating income of $1.2 billion was down $120 million from last year. Compared to the prior year, the decline in 2012 segment operating income primarily reflects weakness in Europe, partially offset by improvement in North American Tyre.
Compared to the prior year, 2012 also benefited from $1 billion in improved price/mix, which more than offset $576 million in higher raw material costs.