Cooper suffers net loss, sales decrease
Cooper Tire & Rubber Co. reported a net loss of $6.3 million on net sales of $631.7 million for the second quarter ended June 30, 2009. That compares to a net loss of $21.7 million on sales of $772.9 million for the same period last year.
When the net loss attributable to noncontrolling shareholders' interests is added to the net loss, the net loss attributable to Cooper Tire is $13 million, which compares to a $22.2 million loss in the second quarter of 2008.
Operating profit from continuing operations was $41.4 million, a $57 million turnaround compared to the $15.4 million operating loss in the second quarter of 2008. Net income from continuing operations was $30.7 million, a change of more than $50 million compared to a $21.6 million loss last year.
Cooper says improved profits were driven by the company’s continued manufacturing improvements and lower raw material costs. However, they were hurt by lower sales volumes, production curtailments and "slightly unfavorable price and mix."
"We were extremely pleased with the improvements that have occurred in our operations," says CEO Roy Armes. "These are the result of work that has been ongoing for several quarters.
"The decrease in raw material prices, combined with the relative strength of pricing and mix, were also welcome changes from the forces we encountered during the second half of 2008. Raw material prices have decreased in recent months, and we do not see a return to the extreme price highs of last year, but do expect increases in the second half.
“Focusing on our global cost structure, profitably increasing our top line, and enhancing our organizational capabilities are the key elements of our strategic plan and each are being addressed while preserving liquidity," says Armes. "While the macroeconomic environment remains challenging, we continue to see progress by successfully executing to our capabilities.
“The employees have done an excellent job of focusing on and delivering improvements. Changes in our manufacturing footprint and other operational improvements continue to reposition Cooper as a stronger company.
"While there are no guarantees that the macroeconomic environment will stabilize or rebound, we look forward to the impact of related operating leverage when economic conditions improve. Because of the uncontrollable factors that affect the tire industry, we remain very cautious about the levels of future profitability,” he adds.
Cooper posted a net loss of $29.6 million ($34.2 million when taking into account the net loss attributable to noncontrolling shareholders' interests) on net sales of $1.2 billion for the first half of 2009. Compared to the first half of 2008, the losses were greater and the sales were lower.
Operating profit for 1H 2009 was $25.2 million versus an operating loss of $5.9 million during the same period a year ago.
The company had cash of $302 million as of June 30, 2009, up $55 million from Dec. 31, 2008. Its debt was reduced by $53 million less during the same period.
For more information, visit Cooper Tire's Web site at www.coopertire.com.