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Analysts note improved Schaeffler outlook, continuing risks

Responding to Schaeffler Group’s recently published second quarter results, including a margin of 15.3 per cent for the quarter, financial analysts have praised the “very respectable results”. However, writing in an investor’s not dated 2 September, Morgan Stanley also noted risked associated with the company’s outlook and pointed out that margins were down 150 basis points year-on-year and 220 basis points quarter-on-quarter due to “higher raw material costs and ongoing expansion costs.”

2nd September 2011/by Tyrepress Editors

Somr named Mitas plant director in Ruma

Ivo Somr has been appointed director of the Mitas agricultural tyre factory in Ruma, Serbia following the planned return to the Czech Republic of the previous facility head, Rudolf Mačák. “Ruma plans to expand production of radial agricultural tyres,” Somr said.

1st September 2011/by Tyrepress Editors

With sales and profits up, Bond plans UK and international expansion

Based just North of York in Pocklington, the relatively small size of this North Yorkshire town belies the current scale and influence of the tyre wholesale operation it is home to. Bond International was founded in 1966 by Reg Bond when the qualified automotive engineer suffered an industrial injury that blinded him in one eye. In spite of the incident, Bond demonstrated great vision by investing his ensuing compensation into expanding his business to incorporate tyre wholesale. Now the company is firmly in the top flight of UK tyre wholesale operations and has purportedly risen as high as number three in recent years (see next month's Wholesale Feature for an update on the current state of UK tyre wholesaling). With an overseas office already located in Singapore, now Bond is considering its European options, while pointing out that there are still opportunities in the UK. On top of this the company recently launched its first foray into the online marketplace, which executive hope will – over time – develop a whole new source of business for it and its retail customers alike.

1st September 2011/by Chris

Western European car market up 8% in August

The Western European car market grew 8 per cent in August despite being down 1 per cent year-to-date. This marks a significant improvement on July which was down 1.5 per cent. According to research produced by Deutsche Bank, August is usually the lowest month of the year with around 750,000 units sold.

31st August 2011/by Tyrepress Editors

Steel price down 15% in 6 months

The price of steel price has dropped US$120-130/tone in Europe (North European HRC) since March and now sites around $730-770/ton level (515 – 540 euros/ton), according too financial analysts. Writing in an investor’s note dated 30 August, Deutsche Bank explained its view of that the market has stabilised in the medium term market: “We expect current prices to remain more or less stable in the second half of 11 and for full year 2012.”

30th August 2011/by Tyrepress Editors

Analysts raise Yokohama estimates

Financial analysts have raised their estimates for Yokohama Rubber after reviewing their raw material assumptions. Their rationale is that, “while not as smoothly as peers, Yokohama Rubber is passing costs on to customers, and despite uncertainties (downturn in US/Europe), we expect it to report 30 per cent growth in adjusted full year…earnings on lower raw material prices and full-year contributions from price hikes.”

26th August 2011/by Tyrepress Editors

Bankruptcy, legal action – all in a week’s work at ShengdaTech

De-listed Chinese firm ShengdaTech has filed for bankruptcy under Chapter 11 of the US Bankruptcy Code. In announcing this action, the nano-precipitated calcium carbonate manufacturer says the Chapter 11 process will “facilitate the company's financial and operational restructuring, with the objective of restoring the company to financial health.” Under Chapter 11, ShengdaTech is permitted to continue trading and managing its assets as usual. Also announced on 22 August was the appointment of Michael Kang, a managing director at global professional services firm Alvarez & Marsal, as Shengdatech’s chief restructuring officer. In this capacity Kang will “lead the company’s restructuring effort.”

25th August 2011/by Tyrepress Editors

Cost of Swansea tyre fire exceeds £1.5 million

The estimated cost of tackling the Swansea tyre fire that burned for 22 days in June and July has been estimated at more than £1.5 million, according to a local news report by the BBC today. The former Mettoys factory, which was illegally housing around 5,000 tonnes of shredded tyres, was completely destroyed by the blaze. It is likely that the local council will be forced to foot much of the bill, though a Swansea council spokesperson said there was an ongoing attempt to recover some of the costs from the operation.

23rd August 2011/by Tyrepress Editors

‘Surprise’ at Goodyear performance – Morgan Stanley

Analysts at Morgan Stanley have reported their “surprise” at Goodyear’s performance in the second quarter of the financial year. The reason they gave for being caught unaware by the US tyre maker’s 24 per cent increase in sales (to US$5.6 billion) and 66.7 per cent rise in net profit (to $40 million) is that “it came in a quarter of weak shipments and rising raw material headwinds.” Despite unit demand being slightly down, Goodyear’s price/mix of $552 million “comfortably beat” Morgan Stanley’s estimate of $450 million and segment operating income for its North American Tire business was $137 million with a margin of 5.7 per cent, which Morgan Stanley notes is the highest level in a decade and in line with the company’s medium-term target.

17th August 2011/by Tyrepress Editors

Reports: Sri Lankan tyre firm’s profits down June 71%

Sri Lanka listed Kelani Tyres, which runs a joint venture tyre business in cooperation with CEAT of India, has released financial results for the quarter to June 2011 showing that profits fell 71 per cent to 18.9 million rupees compared with a year earlier. The firm reported earnings of 24 cents per share for the quarter, in provisional accounts filed with Colombo Stock Exchange.

16th August 2011/by Tyrepress Editors

Ruia resigns as Dunlop India director

Dunlop India Ltd has informed the Bombay Stock Exchange of Pawan Kumar Ruia’s resignation as company director, effective August 10. The chairman of parent company the Ruia Group now holds no official office at Dunlop India, having stepped down as chairman of the tyre maker’s Board of Directors on January 31, 2011.

12th August 2011/by Tyrepress Editors

EC approves Rhodia acquisition bid

On August 5 the European Commission gave its approval for Belgium-based chemical company Solvay’s acquisition of Rhodia. Following this approval, the French Financial Markets Authority AMF has set the closing date of the friendly public takeover bid as Wednesday 24 August 2011. Solvay is offering 31.60 euros per Rhodia share and 52.30 euros for Oceane convertible bonds. As all prerequisite authorisations for the offer have been obtained, execution of the offer is now solely subject to a minimum acceptance level of 50 per cent plus one share on a fully diluted basis.

9th August 2011/by Tyrepress Editors

Analysts: Cooper 2Q results a ‘big miss'

“We had expected the second quarter to be tough…for Cooper given the weak second industry shipment numbers and adverse mix, but we were surprised by how weak it actually was,” was the stark verdict of analysts in response to Cooper Tire & Rubber’s most recent financials. This is exemplified in the company’s profitability results.

8th August 2011/by Tyrepress Editors

German industry leads the West European trailer market recovery

International News, News, Product News

The German trailer industry is undergoing a very rapid revival in its fortunes, according to consulting group Clear. Output of trailers has been boosted by three key demand growth factors, says the firm’s latest report on the subject.

Firstly, the German market itself has recovered from the nadir of 2009 in splendid style: sales of trailers will exceed the combined demand of France, the UK and Italy in 2011 as it did in 2010. Secondly, exports of trailers from Germany increased by 90 per cent in 2010 as markets in both East and West Europe, with a very few exceptions, started to recover. Thirdly, stocks of finished trailers which had accumulated as the recession bit, had been large cleaned out, leaving the industry in a very lean condition. This meant that all new orders went straight into increased production.

4th August 2011/by Tyrepress Editors

Nankang a ‘Top 100 Taiwan Brand’

Taiwan’s Bureau of Foreign Trade and the Taiwan External Trade Development Council have chosen Nankang Rubber Tire as one of the country’s 100 most outstanding brands. The “Top 100 Taiwan brands” were named at ceremony on July 26 and the winning companies were selected on a range of criteria that included brand management, industry position, and financial standing.

1st August 2011/by Tyrepress Editors