Nokian Tyres plc Interim Report January−March 2018: Good development in volumes and prices, headwind from currencies
Nokian Tyres plc Interim Report January−March 2018, May 9, 2018, 8:00 a.m.
This release is a summary of Nokian Tyres’ Interim Report January−March 2018. The complete report is attached to this release. It is also available on the company website at www.nokiantyres.com/company/investors/.
January–March 2018
- Net sales increased by 3.1% to EUR 336.0 million (325.9 in 1–3/2017). Currency exchange rate changes affected net sales negatively by EUR 20.2 million compared with the rates in 1–3/2017. With currency neutral exchange rates, net sales would have increased by 9.3%.
- Operating profit increased by 4.0% to EUR 61.2 million (58.9). Operating profit percentage was 18.2% (18.1%).
- The profit for the period increased by 2.8% to EUR 46.6 million (45.3).
- Earnings per share were EUR 0.34 (0.33).
- Cash flow from operating activities was EUR -18.3 million (-40.1).
Financial guidance (unchanged)
In 2018, with the current exchange rates, net sales and operating profit are expected to grow compared with 2017.
Key figures, EUR million
| 1–3 /18 |
1–3 /17 |
Change % |
4–6/17 | 7–9/17 | 10–12/17 | 2017 | |
| Net sales | 336.0 | 325.9 | 3.1 | 393.0 | 363.1 | 490.4 | 1,572.5 |
| Operating profit | 61.2 | 58.9 | 4.0 | 94.1 | 89.8 | 122.6 | 365.4 |
| Operating profit % | 18.2 | 18.1 | 24.0 | 24.7 | 25.0 | 23.2 | |
| Profit before tax | 60.0 | 58.9 | 2.0 | 87.1 | 67.4 | 118.9 | 332.4 |
| Profit for the period | 46.6 | 45.3 | 2.8 | 71.1 | 10.2 | 94.7 | 221.4 |
| Earnings per share, EUR | 0.34 | 0.33 | 0.52 | 0.08 | 0.69 | 1.63 | |
| Equity ratio, % | 79.1 | 74.5 | 78.2 | ||||
| Cash flow from operating activities | -18.3 | -40.1 | -5.9 | -88.1 | 368.3 | 234.1 | |
| Gearing, % | -11.6 | -16.4 | -14.2 | ||||
| Interest-bearing net debt | -174.1 | -253.4 | -208.3 | ||||
| Capital expenditure | 17.5 | 17.3 | 1.1 | 42.6 | 35.3 | 39.6 | 134.9 |
Hille Korhonen, President and CEO:
“Nokian Tyres had a good start of the year. Our net sales improved in all market areas despite the negative currency effect. Operating profit increased compared to first quarter in 2017.
In Passenger Car Tyres, sales volumes and prices in local currencies improved together with product mix. Sales growth continued and our market share improved in all market areas. The summer tyre season did not start properly during Q1 due to weather conditions, which had an impact on equity-owned Vianor sales as well. In Heavy Tyres, especially sales of agricultural tyres and forestry tyres increased.
In March 2018, we announced the modernized Nokian Tyres brand in order to support the company’s strategic growth areas of North America and Central Europe, where we are seeking profitable growth also outside the traditional winter tyre markets. The new brand reflects the company’s long history, sustainable way of working and Scandinavian values. The promise of peace of mind under all conditions is at the core of our values.
The construction work for Nokian Tyres’ third factory in Dayton, TN, has started in North America. Preparations for ensuring the successful start of the factory's operation are ongoing in various functions.
I am particularly proud of the Bronze Class distinction in the Auto Components category of the RobecoSAM Sustainability Yearbook 2018 as well as the Industry Mover award which we received during the quarter. We have worked many years to improve our corporate sustainability and intend to continue this development in the future.
This year, we are celebrating 120 years in business. Innovative products, a trusted brand, long-term customer relationships, and a commitment to serving customers have given us a strong position on the market.”
BUSINESS UNIT REVIEWS
Passenger Car Tyres
| 1–3 /18 |
1–3 /17 |
Change % |
4–6/17 | 7–9/17 | 10–12/17 | 2017 | |
| Net sales, M€ | 259.1 | 248.0 | 4.5 | 276.4 | 276.2 | 338.3 | 1,138.8 |
| Operating profit, M€ |
74.0 | 75.9 | -2.5 | 84.8 | 98.3 | 100.9 | 359.9 |
| Operating profit, % |
28.6 | 30.6 | 30.7 | 35.6 | 29.8 | 31.6 |
Heavy Tyres
| 1–3 /18 |
1–3 /17 |
Change % |
4–6/17 | 7–9/17 | 10–12/17 | 2017 | |
| Net sales, M€ | 43.1 | 39.8 | 8.3 | 44.0 | 42.1 | 46.5 | 172.3 |
| Operating profit, M€ |
8.3 | 5.7 | 45.6 | 9.1 | 7.9 | 9.4 | 32.2 |
| Operating profit, % |
19.2 | 14.3 | 20.8 | 18.8 | 20.3 | 18.7 |
Vianor
Equity operations
| 1–3 /18 |
1–3 /17 |
Change % |
4–6/17 | 7–9/17 | 10–12/17 | 2017 | |
| Net sales, M€ | 53.3 | 56.3 | -5.4 | 89.8 | 68.7 | 124.7 | 339.4 |
| Operating profit, M€ |
-14.7 | -15.8 | 7.5 | 4.0 | -7.0 | 13.1 | -5.8* |
| Operating profit, % |
-27.5 | -28.1 | 4.5 | -10.3 | 10.5 | -1.7* | |
| Equity service centers, pcs | 193 | 208 | 194 |
In 2017, non-recurring items amounted to EUR 1.8 million in total.
* Excluding non-recurring items: Operating profit EUR -4.0 million, operating profit percentage -1.2%.
Press and analyst meetings
Nokian Tyres Interim Report for January−March 2018 was published on May 9, 2018 at 8.00. a.m.
The result presentation for analysts and media will be held on May 9, 2018 at 10.00 a.m. Finnish time at Hotel Kämp (address Pohjoisesplanadi 29, Helsinki). President and CEO Hille Korhonen will present the interim report and answer questions from the audience.
The presentation can be listened to via audiocast over the Internet at www.nokiantyres.com/resultinfo-Q1-2018 starting at 10 a.m. Finnish time.
The event can also be attended via conference call. Please dial in 5-10 minutes before the beginning of the event:
FI: +358981710495
UK: +442031940552
SE: +46856642702
US: +18557161597
An audio file of the event will be available on the company’s website later same day.
Reporting schedule
Half Year Financial Report January−June will be published on August 8, 2018. Releases and company information will be available at www.nokiantyres.com/company/investors/.
Nokian Tyres plc
Päivi Antola, Vice President, IR and Communications
Further information: Hille Korhonen, President and CEO, tel: +358 10 401 7733
Distribution: Nasdaq Helsinki, media, www.nokiantyres.com
Attachment: Nokian Tyres’ Interim Report January−March 2018
Nokian Tyres is the world’s northernmost tyre manufacturer. The company promotes and facilitates safe driving in demanding conditions. It supplies innovative tyres for cars, trucks and special heavy machinery mainly in areas with special challenges on tyre performance: snow, forests and harsh driving conditions in different seasons. Nokian Tyres’ product development is consistently aiming for sustainable solutions for safety and the environment, taking into account the whole life cycle of the tyre. A part of the Nokian Tyres group, the tyre chain Vianor has approximately 1,500 stores in 26 countries. In 2017 Nokian Tyres had approximately 4,600 employees and net sales of approximately 1,6 billion euros. Nokian Tyres’ share is listed on the Nasdaq Helsinki. Further information: www.nokiantyres.com