Goodyear in Profit for 2004 Second Quarter

In the second quarter of 2004 Goodyear achieved a record levels of sales, the company has reported. With all seven of its businesses profitable, the company also reported net income of $25.1 million (£16.5 million) for the second quarter of 2004, a record figure.

The figures are particularly impressive when compared with the same period last year. In the second quarter of 2003, Goodyear had a net loss of $53 million.

Sales of $4.5 billion were a record for any quarter, and a more than 20 per cent improvement on the 2003 period. According to the company, the increase in sales comes as a result of improved pricing and product mix as well as higher unit volume. It also reflects the positive impact of the consolidation of two subsidiaries and the favourable impact of currency translation.

Tyre unit volume in the second quarter of 2004 was 55 million units, compared to 52.8 million units in the 2003 period. Total segment operating income was $285.8 million, up 91.7 per cent from last year.

“With a relentless focus on delivering sustained growth and profitability to our shareholders, we have been directing our attention toward controlling costs, enhancing dealer relationships, focusing on high-margin product lines and introducing new products designed to please customers around the world,” said
Robert J Keegan, Goodyear chairman and chief executive officer.

“While we still have work to do, we are pleased by the success we have achieved to date, particularly the traction we are gaining in our North American Tire business, which is reporting a quarterly profit for the first time in nearly two years,” Keegan added. “We are confident that we are executing the right strategies. We expect our year-over-year momentum to continue through the second half.”

The company estimates the effects of currency translation had a positive impact on second quarter sales of approximately $86 million. Raw material cost increases of approximately $41 million offset the savings generated from rationalisation actions and improved productivity.