Improved Sales And Profit For Nokian
Nokian’s interim results (first nine months of the year) show increases in sales and profits over the same period for 2000. Nokian’s Brief Financial HighlightsThe tyre market remained “highly challenging” said Nokian, with a decline in key European markets and reduced sales of new cars, especially in the Nordic countries. Global economic uncertainty reduced demand for tyres and problems in European agriculture affected heavy tyre sales.
Nevertheless, Nokian managed to improve sales in all its main markets, with the exception of Germany. Sales were particularly strong in Russia and Eastern Europe. Lower raw material costs had a beneficial effect on profitability.
Nokian’s target for this year is to achieve a sales growth of around ten per cent and to improve on last year’s profitability. Passenger Car Tyres Sales of passenger car tyres were up 14.8 per cent and totalled 142.
5 million Euro. A good seller was the uhp Nokian NRZi, while the third quarter saw good sales of winter tyres, which carry a high profit margin. Mention should be made of the Nokian NRW winter tyre, designed for central Europe; this tyre came out top in a test by German company ADAC, in which it competed against tyres from most major manufacturers.
Production of passenger car tyres increased sharply, due to a new mixing plant and expansion in component manufacture and curing capacity. Heavy Tyres The situation was not so good for heavy tyres, with sales declining by 7.9 per cent (37.
6 m Euro against 40.8 m). The replacement market was particularly badly affected, leading to price cutting by some companies in an attempt to reduce stocks.
Despite this, Nokian increased its prices. A positive note was the increased sales of radial tyres for forestry machines; a trend which has led Nokian to make substantial investments in expanding this production technology. Bicycle Tyres Sales suffered in a tough market environment, falling 19.
7 per cent to 3.8 million Euro (4.8 million for the same period last year).
Retreading Materials Demand in this sector was strong, with sales rising by 9.1 per cent to reach 8.1 million Euro (7.
4 million). Sales to North America were brisk and new clients were found in Estonia, Hungary, Italy and Russia. The best-s eller was the Nokian Noktop 32 tread.
Production of retreading materials reached record levels by the end of September, due largely to the new mixing plant. Vianor The Vianor retail chain generated sales of 117.7 million Euro, up 9 per cent on last year.
The operating result for the first nine months was -6.4 million Euro (-9.4 million).
A partnership programme was extended with the opening of a retail outlet in Moscow – the first in a planned chain of wholesale and partnership-based outlets in the largest major Russian cities. The target is 100 such outlets by the year 2006. Currently, the Vianor chain comprises 157 company-owned sales outlets and 14 partner outlets in Finland, Sweden, Norway, Estonia, Latvia and Russia.
1.5 million Euro will be invested this year in the integration process and in strengthening the chain in Sweden..