A good start: Goodyear posts profit in 1Q
Goodyear Tire & Rubber Co. recorded net income of $103 million on net sales of $5.4 billion for the first quarter ended March 31, 2011. That compares to a net loss of $47 million on sales of nearly $4.3 billion for the same period in 2010.
First-quarter sales were a Goodyear record -- for any quarter. The 27% increase in sales reflected a $219 million increase in volume (46.8 million tires, up almost 7% from 2010). Sales also benefited from strong price/mix improvements, which drove revenue per tire up 15% over 1Q 2010, excluding the impact of foreign currency translation.
“Our outstanding revenue-per-tire performance reflects a continued focus on developing and selling innovative products in targeted market segments,” says Richard Kramer, chairman, CEO and president.
First-quarter sales also were impacted by a $276 million increase in sales in other tire-related businesses, primarily third-party chemical sales in North America, and a favorable foreign currency translation of $125 million.
Goodyear's segment operating income for the quarter was up 36.2%, from $240 million to $327 million.
North American Tire
“Improvement in North American Tire is a critical element to achieving our targets," says Kramer. "North American Tire’s first-quarter performance strengthens my confidence in our future."
The North American Tire business unit posted 1Q sales of $2.3 billion, up 29.7% from the first quarter of last year. Unit sales were up 12.5%, from 15.2 million units to 17.1 million:
Original equipment unit volume: up 8%.
Replacement unit volume: up 14.5%.
Segment operating income was $40 million. That compares to an operating loss of $14 million in 2010.
Units, sales and operating income also were up in the company's Europe, Middle East and Africa Tire business unit.
“All of our businesses made great progress in offsetting higher raw material costs through improved price/mix and in driving sales of new, innovative products,” says Kramer.