Pirelli: Revenues, profit up in H1 2022
Pirelli & C. SpA reports higher revenues and profit in the first half of this year despite lower volumes. The company has also updated its full-year targets for 2022.
The tyre maker reports that its revenues during the first six months of 2022 amounted to 3,197.0 million euros, representing year-on-year growth of 24.6 per cent. Revenues amounted to 1,675.9 million euros in the three months to 30 June 2022, growth of 26.9 per cent compared with the second quarter of 2021.
Adjusted Ebit in the first half of 2022 was up 27.6 per cent year-on-year to 481.6 million euros, with an Adjusted Ebit margin of 15.1 per cent H1 2021: 14.7%). Pirelli states that the positive effect of price/mix more than offset increased materials and production costs as well as falling volumes.
In the second quarter, adjusted Ebit rose 21.3 per cent year-on-year to 253.1 million euros thanks to the strong contribution of internal levers. The adjusted Ebit margin stood at 15.1 per cent (Q2 2021: 15.8%).
Ebit in the first half of 2022 was 405.2 million euros, an increase of 63.0 per cent compared with the first half of 2021.
Net profit in the first half of 2022 was 233.0 million euro, an increase of 77.1 per cent compared with the first half of 2021, reflecting improved operating performance and with lower restructuring and non-recurring charges offsetting an increase in financial charges and taxation. In the second quarter of 2022, net profit was 123.2 million euro, an increase of 37.8 per cent compared with the second quarter of 2021.
Volumes: divergence between High Value/Standard
Total volumes were down 1.0 per cent year-on-year in the first half of 2022. Although volumes in the High Value segment (car tyres 19” and up, specialties and products for electric vehicles) grew 5.8 per cent year-on-year, this could not cancel out the 8.8 per cent declined in Standard segment volumes for both car and moto tyres. In the second quarter of 2022, total volumes were down 0.6 per cent (High Value +5.7%, Standard -7.9%).
H1 2022 volume growth in the Car segment was around 1.0 per cent year-on-year, above the market decline of approximately 1.0 per cent. Volume growth was strongest in the 18” and up rim diameter sizes, where Pirelli’s year-on-year growth of eight per cent outperformed the market’s five per cent growth. On the other hand, volumes for Pirelli’s 17” and smaller Standard segment car tyres decreased seven per cent year-on-year, a greater decline that the three per cent contraction in the wider market.
Volumes for Moto products dropped nine per cent year-on-year in H1 2022 and ten per cent in the second quarter of the year. Pirelli attributes this development to a 24 per cent fall in Standard sales related to the closure of its factory in Gravatai, Brazil. The High Value Moto segment enjoyed year-on-year growth of six per cent, in particular in Europe and North America thanks to a renewed road and touring product range.
Updated 2022 targets
In light of its first-half performance and current global events, Pirelli has updated its 2022 targets and now anticipates revenues between approximately 6.2 billion and 6.3 billion euros, around 300 million euros higher than the previous target. Expected total volume growth remains between around 0.5 per cent and 1.5 per cent, albeit with a greater emphasis upon High Value, particularly in the original equipment segment. At around 15 per cent, Adjusted Ebit Margin remains unchanged.
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