Michelin blames euro for profits dip

 12 Feb 2014 - 8:51

PARIS: Tyre-making giant Michelin blamed a rise of the euro and flat markets for a profits plunge and weak sales in 2013, in a results statement yesterday.
The group supplies a vast range of tyres to the car, truck, aviation, mining and agricultural sectors, and is therefore an indicator of global economic activity.
The company, known around the world by its logo of a man made of tyres, said that the global market for tyres was recovering slightly. Net profit dropped by 28.0 percent to ¤1.13bn ($1.55bn) from the 2012 level, and operating profit before non-recurrent items was down 7.8 percent to ¤2.23bn.
The operating outcome was hit mainly by a rise of the euro in the second half of the year which cut the annual performance by ¤230m, it said. Restructuring of some activities in the home base France also cost ¤260m.
Group sales fell by 5.7 percent to ¤20.25bn.
The market for tyres had been weak in the first half of the year, picking up in the second half, but prices had come under downward pressure because some contracts were linked to the price of raw materials, Michelin said. However, the group cut net debt to ¤142m from more than ¤1.0bn in 2012.