Record Sales For Cooper In 1Q
Cooper Tire & Rubber’s first quarter results show sales at an all-time record high of $974 million; a Year-on-Year increase of 23 per cent. Net income increased by 56 per cent to $24 million (1Q 2003: $15 m). Tire Group operations showed a record turnover of $485 million, 23 per cent up on the 1Q 2003 figure of $396 million, and a 12 per cent increase in volumes and an improved mix. Sales of high performance tyres rose by 47 per cent, those of P-metric tyres were up 52 per cent and truck tyre sales were up 27 per cent. Despite this, operating profit was down slightly at just under $16 million. Raw material costs reduced operating profit by $18 million while product liability and litigation costs were $9 million higher than 1Q 2003.
There were record sales too for the Automotive Group – once again 23 per cent higher, at $497 million. New business launches added $79 million to sales and currency fluctuations added $31 million. Operating profit for the quarter was up 69 per cent, from $23 million to $39 million. Chairman, President and CEO Thomas A. Dattilo was upbeat about the company’s prospects, saying: “2004 is shaping up to be a very exciting year for Cooper. Our sales volumes are going to be strong, we are seeing significant improvement in our plants and we are finding ways to reduce costs to offset the headwinds of raw materials and product liability expense. Raw material costs are likely to remain high throughout the year, but the tyre price increase we implemented in February and additional price increases planned for June will help offset that impact.” Dattilo promised increases in capacity to keep pace with demand, both in the USA and as part of the company’s Asian strategy, with construction beginning on the joint venture tyre plant in China. Despite the success of the Automotive Group in 1Q, Cooper is still exploring the possible sale of its automotive operations and reports “significant interest” in the group.