Continental AG says its first quarter results were "solid" and "in line with expectations."
The company achieved an 11.1% year-over-year increase in consolidated net sales and a 35% gain in operating results during the first three months of 2023.
Continental's Tires group achieved sales of 3.5 billion euros during 1Q 2023, a 5.1% year-over-year increase.
Its Automotive group achieved a sales gain of 18.1%, while the company's ContiTech business unit saw a gain of 10.2% during the quarter.
"The good start to the year by our Tires group sector and the earnings performance of ContiTech are encouraging," notes Continental CEO Nikola Setzer.
"Furthermore, Automotive’s earnings were up slightly, marking a strong improvement compared with the same quarter of last year."
Market outlook
"For 2023, Continental expects global production of passenger cars and light commercial vehicles to increase by 2% to 4% year-on-year," say Continental officials.
"For the tire replacement business, we expect a slight recovery in demand of 1% to 3% for the year as a whole. The industrial business is currently showing signs of stabilizing at the previous year's level in the Eurozone. In the U.S.A., we anticipate a figure of between -2% and zero percent for the year as a whole and in China we expect a recovery demand of 4% to 6%.
"Significantly higher costs for materials, wages and salaries, as well as energy logistics - amounting to around 1.7 billion (euros) - are again expected to weigh heavily on our earnings position in fiscal 2023."
For fiscal year 2003, Continental expects to see overall sales of 42 billion euros to 45 billion euros and an adjusted EBIT margin of around 5.5 percent to 5.6 percent.
"Four our Automotive group sector, we anticipate sales of around 20.5 billion euros to 21.5 billion euros and an adjusted EBIT margin of around 2% to 3%."
Continental expects to see full-year 2003 Tire sector sales of "around" 14.5 billion euros to 15.5 billion euros and an adjusted EBIT margin of around 12% to 13%. "This includes the expected negative impact from higher costs for wages and salaries, as well as energy and logistics of around 400 million euros."
The company projects that its ContiTech unit will achieve sales of around 6.8 billion euros to 7.2 billion euros, with adjusted EBIT coming in at around 6% to 7%.
More information can be viewed here.
