Michelin sales, volumes up in Q1

A positive 9.7 per cent currency effect due to euro weakness helped Michelin achieve 5.6 per cent year-on-year growth in net sales in the first quarter of 2015, even though a 5.1 per cent worsening in price mix whittled €245 million from this top line result. Net sales for the three-month period amounted to €5.02 billion. Overall sales volumes rose 1.5 per cent, performance described by Michelin CFO Marc Henry as “faster than market growth.” He added that this performance was “in line” with declining B2B markets for truck and specialty tyres, and showed faster growth than B2C passenger car and light commercial tyre markets.

The best-performing segment in terms of net sales was the company’s passenger car and light truck tyre business, with net sales here rising 10.2 per cent to €2.78 billion. Net truck tyre sales rose 0.8 per cent to €1.47 billion in the first quarter of the year, while speciality tyre sales declined 0.6 per cent to €771 million.

Original equipment passenger car and light truck tyre volumes in Europe rose two per cent year-on-year, with the four per cent increase driven by rising new car registrations in Western Europe balancing against a 19 per cent decline in Eastern Europe. Although demand for replacement market tyres increased two per cent in Western Europe, a result reflecting declines in the UK and Germany but a strong recovery in Turkey, overall European year-on-year replacement volumes were dragged one per cent lower than a year ago due to the 15 per cent decrease in Eastern Europe and Russia.

Europe’s original equipment truck tyre market remained flat in the first quarter of 2015, with growth of four per cent in Western Europe cancelled out by a 24 per cent drop in Eastern Europe. The Replacement truck tyre market contracted ten per cent on the back of a one per cent decline in Western Europe and a shrinkage of 24 per cent in Eastern Europe.

Michelin’s global specialty tyres business was affected by a weakening market for mining tyres despite a growth in demand for original equipment earthmover tyres and higher demand for tyres used in infrastructure and quarries in mature markets, a fall in global demand for original equipment agricultural tyres and a contracting agricultural replacement market in Europe and North America, an expansion of the motorcycle tyre market in Europe and North America, and growth in the aviation tyre segment.

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