1H results: Michelin increases income by 23%
Groupe Michelin posted net income of 624 million euros on net sales of more than 9.6 billion euros for the first half ending June 30, 2014. That compares to income of 507 million euros on sales of more than 10.1 billion euros for the first half of 2013.
Based on the exchange rate on June 30, 2014, Michelin recorded net income of $851.8 million on net sales of $13.2 billion for the first half of fiscal 2014. Its income-to-sales ratio was 6.4%.
Michelin's operating income was 1.1 billion euros (nearly $1.6 billion), up less than 1% from the previous year.
Here is the first-half breakdown, in U.S. dollars, of Michelin's tire segments.
Tire segment Net sales Operating income
Consumer $7 billion $802.7 million
Truck $4 billion $308.5 million
Specialty $2.1 billion $471 million
“In a competitive environment that persisted through the first half, Michelin met its objective of delivering a further improvement in its performance, with a nearly 200 million euro increase in operating income at constant scope of consolidation and exchange rates,” says Jean-Dominique Senard, chairman, CEO and general partner.
“A continuous flow of innovations praised by vehicle manufacturers and a responsible, ambitious industrial strategy enabled the Michelin brand to maintain its global positions in the forefront of mobility.”
Michelin says global demand for car and light truck and truck tires should remain supportive in the mature markets and China in the second half.
"On the other hand, the other new markets are seeing a slowdown, especially in the original equipment segment. At the same time, original equipment demand for earthmover tires should continue to significantly improve, while mining companies are expecting to continue drawing down inventory through the end of the year, although fourth-quarter growth will benefit from favorable prior-year comparatives."