Goodyear Commences Senior Notes Offering
The Goodyear Tire & Rubber Company commenced a public offering of $750 million aggregate principal amount of 10-year senior unsecured notes today (10 August 2010), subject to market and other customary conditions. According to the company, Goodyear plans to use the offer offering, together with cash and other funds to redeem $325 million in principal amount of 8.625 per cent senior notes due 2011 and approximately $388 million in principal amount of 7.857 per cent notes due 2011.
Continue ReadingConti’s 702 million euro EBIT was 10% Ahead of Consensus
Analysts at Morgan Stanley have upgraded their target price for Continental stock following second quarter results that were 10 per cent higher than consensus, while reducing net debt by 220 million euros to 8 billion. “We feel comfortable bringing our ’10 EPS to 4.92 euros and increasing ’11 and ’12 EPS by 25-35 per cent…We believe Conti shares will benefit as the debt refinancing continues – but we cannot justify an overweight rating with only 18 per cent upside potential to our price target. Moreover, numerous unknown factors, including risks related to Schaeffler’s continued 75.1 per cent dominance over the company, keep us on the sidelines,” the bank’s analysts wrote in an investor’s note published on 30 July.
Continue ReadingCooper Tire Shares Fall, But Analysts Say Market Underestimates Firm’s Potential
Shares in Cooper Tire & Rubber Co. fell by as much as 13 per cent yesterday (Thursday 5 August) after the tyre manufacturer reported second-quarter revenue below estimates and said earnings were hurt by increased raw material costs. However, market analysts reported that the market has underestimated Cooper’s “near term potential.”
Continue ReadingStrong Sales Push Cooper to Strong First Half
Cooper Tire & Rubber Co. continued its strong 2010, posting a 27 per cent increase in sales for the second quarter and a $57 million improvement in net income for the period, reports Tire Review. Cooper posted second quarter sales of $804 million. Net income for the period came in at $44 million, up $57 million versus the same period in 2009.
Continue ReadingCooper Pays Out Quarterly Dividend
Cooper Tire & Rubber Company has announced a quarterly dividend of 10.5 cents per share on common stock, payable 30 September, 2010, to stockholders of record at the close of business 2 September, 2010. This will mark the 154th consecutive quarterly dividend paid by Cooper Tire & Rubber Company.
Continue ReadingToyo Reports 53 billion yen of Net Sales, Profits Back in Black
Toyo Tire & Rubber Co., Ltd., has reported that it has returned to first quarter profitability with an operating income of 2,612 million yen compared with an operating loss of 3,054 million yen in the first quarter of 2009. Net income faired less well but showed the company returned to the black by this measurement too, with 743 million yen in the first quarter of 2010 compared with a net loss of 2,620 million yen for the same period in 2009. Period net sales totalled 72,162 million yen, up 9,789 million yen or 15.7 per cent over the first quarter of 2009. The tyre business unit posted net sales of 53,097 million yen and operating income of 1,995 million yen.
Continue ReadingMichelin Upgraded to ‘Buy’ Following Better than Expected Results
Analysts at Deutsche Bank have upgraded their rating for Michelin shares to “Buy” following first half 2010 financial results that were better than expected. The results published on 30 July show that revenues were up 17 per cent, mostly driven by volume growth of 15 per cent. According to the analysts, this was “by far the main earnings driver” since raw material price increases had no negative impact on first half results due to a lag effect. Overall first half 2010 operating income (822 million euros) virtually caught up with the firm’s full-year 2001 operating profit of (862 million euros). Looking forward, the company’s management is now aiming for a full year operating margin of close to 9 per cent (1.5 billion euros), underscoring that in the second half the group should be able to more than offset a raw materials price headwind of 650 million euros.
Continue ReadingStamford Tyres Probing Markets for Increased Penetration following “Foundational” FY2010
Stamford Tyres is a business of two major halves. Firstly it runs a distribution business in nine countries including its home nation of Singapore; secondly it is the manufacturer of its SSW brand of wheels and the owner of its outsourced manufactured Sumo Firenza proprietary brand tyres, which it displayed in Europe recently at Essen 2010. “We help the plants with technical assistance, with our own designs for products, and we own our own tooling,” explained the company’s CEO and president, Wee Kok Wah when Tyres & Accessories interviewed him on his recent visit to London following Reifen 2010. “That way we can gear our capacity quite quickly and easily. We have a large team of engineers in China to deliver product quality assurance. The product meets the highest standard that you want.”
Continue ReadingReasonable First Half Growth for Goodyear in EMEA, North America
Goodyear has experienced a reasonable second quarter of this financial year in the Europe, Middle East and Africa segment, where second quarter sales increased 5 per cent to $1.5 billion. This was primarily due to a 6 per cent increase in tyre unit volume and strong price/mix performance, according to the company. In worldwide results, the company’s sales were $4.5 billion, up 15 per cent from 2009. Second quarter sales reflect the $304 million impact of a 10 per cent increase in tyre unit volume in response to improved global demand.
Continue ReadingPirelli Second Quarter 20% Ahead of Analysts’ Consensus
Financial analysts have described Pirelli Spa’s second quarter 2010 results as a “symbolic quarter” after the group, led by its tyre sales, posted results roughly 20 per cent ahead of analysts expectations and unexpectedly increased its 2010 earnings targets. The group increased its sales targets to 4.8 - 4.9 billion euros (from 4.6-4.7 billion) and is targeting EBIT margins 7 per cent versus 6.5 per cent previously.
Continue ReadingPirelli Reports Reports Strong 1H, Ups Targets
Pirelli Spa has reported that the firm closed the first half of 2010 with revenues of 2,426.5 million euros (1H 2009: 2,026.2 million euros), up 19.8 per cent. Pre-tax profits (EBIT) grew 62.8 per cent to 193.4 million euros (2009: 118.8 million euros). Net income of continuing operations more than doubled to 80.8 million euros, compared with 30.3 million euros in the first half of 2009. Such was the success of the tyre business in the first half, the company raised its revenue target. Executives now expect revenues to rise 15 per cent organically compared with the target of more than 10 per cent organic growth estimated in May. Pirelli also announced that it will present its new 2011-2013 three-year plan to the financial community in November.
Continue ReadingCooper to Restate 2009, 1Q 2010 Financials
Cooper Tire & Rubber Co. announced that it will restate its earnings for 2009 and for 2010’s first quarter due to a “material weakness” in the company’s internal financial reporting, Tire Review reports. As a result, at least for full year 2009, Cooper’s net profit will improve, the company reported. How the restatement will impact first quarter 2010 results is unknown.
Continue ReadingHankook Results Counter ‘Lacklustre’ Analyst Expectations
Hankook recent record second quarter results contradict the negative predictions of some financial analysts that when Hankook Tire kicks off the second quarter earnings season for auto/auto part makers on 20 July, it will set the tone for a “lacklustre” set of results from the likes of Hankook, Kumho and Nexen. In an investor’s note dated 1 July 2010, Deutsche Bank research analyst Sanjeev Rana had commented: “We expect tyre makers such as Hankook and Nexen Tire to report in line or slightly below consensus results due to the burden of higher rubber prices.” It appears these reports failed to take into account the huge profit jumps of 501 per cent and 43 per cent in the first quarter 2010 from Hankook and Nexen respectively and an 18 per cent increase in sales from Kumho – all of which surprised analysts at the time.
Continue ReadingDunlop Aircraft Tyres Celebrates Centenary with Book, Film Launch
Last night saw the celebration of Dunlop Aircraft Tyres’ Centenary take place in earnest following an open day and a visit to the company’s Fort Dunlop plant by The Duke of York, with the launch of a new commemorative book, the premiere of a film by artist Angus Boulton commissioned to celebrate the centenary and the introduction of a new corporate video. The venue for the prestigious occasion was The Wapping Project, London’s last Hydraulic Power Station, now regenerated as a post-industrial exhibition space and restaurant by Australian theatre director, Jules Wright.
Continue ReadingAnalysts: Increased Volume and Raw Material Costs, But ‘Robust’ 2Q for Tyre Majors
Market analysts at Morgan Stanley have predicted a “robust second quarter results season characterised by rebounding volumes and cost savings.” The volume of sales, which are reported to have improved from the low base of 2009, is said to be tyremakers’ biggest tailwind, but the increased cost of raw materials are also expected to kick-in in the manufacturers’ second quarter reports. Raw materials are estimated to add a headwind of 300 – 440 basis points to the tyremakers’ margins, a trend that Morgan Stanley expects to accelerate through the rest of the year. Crucially, Morgan Stanley’s view is that while some of the numerous prices increases implemented up till now “are likely to feed through to the bottom line already,” they are note expected to cover more than a third of the input cost burden this quarter.
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