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Michelin nets $1.4 billion in fiscal 2010

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Groupe Michelin recorded net income of 1 billion euros on net sales of 17.9 billion euros for its fiscal year ended Dec. 31, 2010. That compares to income of 104 million euros on sales of 14.8 billion euros for fiscal 2009.

Based on the exchange rate on Dec. 31, 2010, Michelin posted revenue of nearly $1.4 billion on sales of $23.7 billion in 2010. The company's net income represented 5.8% of its sales

Michelin's operating income (before non-recurring income and expenses) was 1.7 billion euros, up 96.6% from 2009.

"For Michelin, 2010 was a year of strong growth, enhanced by manufacturing flexibility and historically high margins," says Michel Rollier, Michelin's managing partner. "In recent years, we have laid the foundations for a new phase of dynamic growth, built on dedication and professionalism of our teams, the value of our brands and a clearly strengthened balance sheet.

"Leveraging these improvements, Michelin has embarked on a new phase of faster growth, supported by an unprecedented capital expenditure program, and aims to increase its sales volumes by at least 6.5% in 2011.

"In response to the sharp increase in raw materials costs, the Group will maintain its dynamic pricing policy and, barring any major change in the economic environment, expects to see an increase in operating income in 2011, he says.

"In light of our capital expenditure commitments and the increase in raw materials costs, free cash flow is expected to be temporarily negative in 2011. Nevertheless, Michelin confirms its objective of generating positive free cash flow over the entire 2011-2015 period."

(For more information on Rollier, see "Michelin's Rollier hand picks his successor.")

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