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Pirelli posts 1Q net profit of 10 million euros

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Pirelli & Cie SpA posted a net profit of 10 million euros on consolidated revenues of 1.68 billion euros for the first quarter ended March 31.

Revenues were up 6.7% compared to the same period a year ago, when the company posted a net loss of 20 million euros. Net of the effects of exchange rates and metal prices, revenues were up 4.6%.

EBITDA was 172 million euros vs. 154 million euros in the first quarter of 2003, an increase of 12%. The ratio of EBITDA to revenues grew from 9.8% to 10.3%.

Operating income (EBIT) totaled 83 million euros, up 22%.

The results from Pirelli's Tyre Sector showed improved profitability and growth in all market segments.

* Sales totaled 819 million euros, a year-on-year increase of 12.5%.

* Operating income was 75 million euros, with a return on sales of 9.2% -- an improvement of 13.6% compared to 2003.

* Net profit stood at 38 million euros after taking into account financial costs of 10 million euros and fiscal charges of 27 million euros). That's an increase of 15% compared to the same period last year.

The Tyre Sector is part of Pirelli's industrial operations, which posted net profit of 34 million euros on sales revenues of 1,586 million euros in the first quarter.

The industrial group also includes the

Energy Cables and Systems Sector and the Telecom Cables and Systems Sector.

Pirelli's board of directors forecasts continued growth in all three sectors of its industrial group for the 2004 fiscal year, at both the operating and net levels, "unless extraordinary events currently not forecastable happen."

Pirelli expects to further improve its results in the Tyre Sector thanks to the high performance segment in Europe, the truck segment in South America and "increasing market share in North America."

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