Goodyear Reports Better Than Expected Results

Goodyear has officially reported third quarter results that show “record sales and positive net income.” According to the company the improved figures were driven by improved operating results in all seven of its business segments.

The company reported net income of $36.5 million (21 cents per share). At the same time last year Goodyear recorded net losses of $119.4 million (68 cents per share). This time around the company achieved sales of $4.7 billion, which the company says is a new record for any quarter and a 20.7 per cent increase from $3.9 billion during 2003. Goodyear reports that tyre unit volumes also increased, growing from 55.3 million units in 2003 to 57.4 million in 2004.

During the first nine months 2004 Goodyear made a turnover of $13.5 billion. This is about 21 per cent more than in the same period of last year. $896 million came from the consolidation of Pacific Tires, while $391 million was the result of the positive impact of currency translation. The net loss for the first three quarters totalled $12.3 million, which compares very favourably with the same period last year when it totalled $372.3 million.

Goodyear made progress in North America and grew by 1 per cent while the market itself decreased by 6 per cent. However, the company continues to lack profitability. This year Goodyear’s operating profit margin totalled 0.3 per cent while it was last year it was –2.3 per cent. In Latin America Goodyear managed some outstanding results during the first nine months. Here its operating margin was markedly larger at 20.5 per cent, and led to a healthy operating income of $186.7 dollars. It was a similar story in Eastern Europe where Goodyear’s operating profit was 16 per cent and its operating income totalled $148.2 million. In Western Europe the company’s margin improved from 3.9 to 6 per cent, which created an operating income of $195.1 million.

“We are pleased with the year-over-year improvement in our results as well as the momentum we are building on the strength of our new products and the Goodyear brand. As a result of our new Goodyear-brand products and the continued strength of our high performance and truck tyre products, we gained share in the consumer replacement and the commercial OE and replacement markets in North America during the third quarter,” said chairman and CEO Robert J Keegan.