Cooper achieved sales, income gains in fourth quarter
Cooper Tire & Rubber Co. posted net income of $51 million for the fourth quarter of 2007. Income from continuing operations increased $67 million from a loss of $28 million during the fourth quarter of 2006. The earnings improvement was accompanied by fourth quarter 2007 sales of $765 million, a 7% increase over the same period in 2006 and a new record for Cooper.
Cooper's operating profit improved to $43 million during the fourth quarter of 2007 versus an operating loss of $18.7 million during 4Q 2006, which included $48 million "of impairment related to goodwill and indefinite-lived intangible assets," according to Cooper officials. (In previously issued 2006 financial statements, this amount was classified below operating profit.)
"Net income from continuing operations for the fourth quarter of 2007 includes a benefit of approximately $12 million, or 19 cents per share, relating to adjustments to tax valuation allowances established in 2006 which are no longer required due to the reduction in the company's net deferred tax asset position. During the quarter, asset write-downs totaled $3.5 million."
For the year ended December 31, 2007, Cooper's net income improved to $120 million on $2.9 billion of sales, a $198 million improvement in net income over the prior year, and a 13.9% increase in net sales.
Cooper's North American Tire unit generated $45 million in operating profit from continuing operations in the fourth quarter of 2007, an increase of $56 million compared with the fourth quarter of 2006.
"This improvement was the result of the company’s cost savings and profit improvement initiatives and favorable pricing changes," say Cooper officials. "These were partially offset by increased incentives, raw material costs, and lower unit volumes."
Cooper's North American Tire operations reported sales of $585 million in the quarter, up 4% compared with the fourth quarter of 2006. "This increase was driven by improved pricing."
During 4Q 2007, Cooper recognized a $26.5 million gain on the sale of the operations of the Oliver Rubber Co. to Michelin North America Inc. and received net cash proceeds of $66 million.
For the full year of 2007, Cooper's North American operations generated $119 million of operating profit on $2.2 billion of net sales, an improvement of $159 million over operating profit during the same period a year ago.
Meanwhile, Cooper's International Tire Operations reported sales of $228 million in the quarter, an increase of 29% compared with the fourth quarter of 2006.
The segment’s operating profit improved by $8.6 million to $3.8 million from the prior year’s fourth quarter loss of $4.8 million. The increase was driven by higher unit volumes and pricing, say Cooper officials.
For the total year, operating profit for Cooper's International Tire Operations segment improved to $29 million, a $19 million increase over 2006 results.