1Q results: Cooper nails North America
In North America, Cooper Tire & Rubber Co. posted net sales of $648 million during the first quarter of fiscal 2011, ended March 31. That is 22% higher than its net sale of $532 million for 1Q 2010.
The increased sales in its North America Tire Operations segment were the result of two things, according to the company:
1. stronger price and mix;
2. increased unit sales.
The company's total light vehicle tire shipments in the United States increased by 9.2% compared with a total industry shipment increase of 8.8% (as reported to Cooper by the Rubber Manufacturers Association). Unit sales for the North American segment increased 8.6% compared with the first quarter of last year.
During the quarter, North America Tire Operations implemented a Feb. 1 price increase of 2.5% on light vehicle tires in the U.S., and another price increase on March 15 that will have an impact on average of between 8% and 9%, with prices varying by product.
The segment's operating profit was $22 million for the first quarter, or 3.3% of net sales. This is an increase of $8 million compared with the same period in 2010.
Favorable pricing and mix of $57 million were more than offset by $90 million of higher raw material costs. Products liability expenses were $19 million lower than a year ago. Higher volumes improved results by $12 million.
Restructuring charges decreased by $8 million from the prior year. Improved manufacturing operations increased results by $4 million. Other costs were higher by approximately $2 million.
Overall, Cooper posted net income of $16 million on net sales of $906 million for the first quarter ended March 31, 2011.
For more information on the company's first-quarter financial results, click on "Cooper sales increase by 20%, profit by 33%."