Nokian Tyres plc Interim Report January–March 2021: Strong volume growth in all markets, demand recovering
Nokian Tyres plc Interim Report January–March 2021, May 4, 2021 at 2:00 p.m.
This release is a summary of Nokian Tyres’ Interim Report January–March 2021. The complete report is attached to this release. It is also available on the company website at www.nokiantyres.com/company/investors/.
January–March 2021
- Net sales were EUR 341.8 million (279.8 in January−March 2020) and grew by 22.1%. With comparable currencies, net sales increased by 28.5%.
- Segments operating profit was EUR 50.3 million (16.3), with negative currency impact of approximately EUR 10 million. Operating profit was EUR 44.3 million (9.0).
- Segments earnings per share were EUR 0.29 (0.09). Earnings per share were EUR 0.26 (0.02).
- Cash flow from operating activities was EUR -24.4 million (-38.9).
Guidance for 2021
In 2021, Nokian Tyres’ net sales with comparable currencies and segments operating profit are expected to grow significantly.
The global car and tire demand is expected to pick up, but the COVID-19 pandemic continues to cause uncertainties for the development.
Jukka Moisio, President and CEO:
“Demand for replacement tires has recovered rapidly since the end of 2020. In the first quarter, we reached an all-time high sales volume. Thanks to a great performance by all our business units and business areas, net sales increased by 28.5% with comparable currencies. Segments operating profit grew substantially driven by higher sales volume.
In Passenger Car Tyres, volume growth was particularly strong in Russia as we gained market share especially in summer tires. On the other hand, a weak Russian ruble together with the higher share of Russian volume had a significant negative impact on the average sales price. Heavy Tyres reached an all-time high quarterly net sales and segment operating profit.
To ensure the availability of our premium products, we have operated the Russian factory at full capacity. In the US, we continue to ramp-up production to reach an output of around one million tires in 2021. In Finland, we are increasing our production capacity for passenger car tires by approximately 30% this year as announced in March. Raw material costs are estimated to increase significantly in the second half of the year compared to 2020.
In 2021, our focus will remain on growth and cash flow. New products and continuous improvements in go-to-market activities will help us build an even stronger foothold in our core markets. We want to benefit from a good momentum in the market while still acting prudently to keep our company strong and competitive for years to come.”
Key figures
| EUR million | 1–3/21 | 1–3/20 | Change | CC* Change |
2020 |
| Net sales | 341.8 | 279.8 | 22.1% | 28.5% | 1,313.8 |
| Operating profit | 44.3 | 9.0 | 120.0 | ||
| Operating profit % | 13.0% | 3.2% | 9.1% | ||
| Profit before tax | 43.7 | 5.8 | 106.0 | ||
| Profit for the period | 35.5 | 2.4 | 86.0 | ||
| EPS, EUR | 0.26 | 0.02 | 0.62 | ||
| Segments operating profit | 50.3 | 16.3 | 190.2 | ||
| Segments operating profit % | 14.7% | 5.8% | 14.5% | ||
| Segments EPS, EUR | 0.29 | 0.09 | 1.04 | ||
| Segments ROCE, %** | 10.6% | 14.4% | 9.3% | ||
| Equity ratio, % | 66.8% | 69.4% | 65.3% | ||
| Cash flow from operating activities | -24.4 | -38.9 | 422.4 | ||
| Gearing, % | 1.9% | 7.3% | -1.1% | ||
| Interest-bearing net debt | 30.9 | 120.9 | -17.2 | ||
| Capital expenditure | 17.1 | 50.9 | 149.9 |
* Comparable currencies
** Rolling 12 months
BUSINESS UNIT REVIEWS
Passenger Car Tyres
| EUR million | 1–3/21 | 1–3/20 | Change | CC* Change |
2020 |
| Net sales | 245.9 | 190.5 | 29.1% | 38.5% | 871.3 |
| Segment operating profit | 52.8 | 25.8 | 177.8 | ||
| Segment operating profit % | 21.5% | 13.5% | 20.4% |
* Comparable currencies
Heavy Tyres
| EUR million | 1–3/21 | 1–3/20 | Change | CC* Change |
2020 |
| Net sales | 57.1 | 51.2 | 11.6% | 13.0% | 194.6 |
| Segment operating profit | 12.6 | 8.2 | 23.7 | ||
| Segment operating profit % | 22.0% | 16.1% | 12.2% |
* Comparable currencies
Vianor, own operations
| EUR million | 1–3/21 | 1–3/20 | Change | CC* Change |
2020 |
| Net sales | 58.1 | 54.4 | 6.8% | 4.2% | 318.1 |
| Segment operating profit | -9.8 | -12.4 | 4.0 | ||
| Segment operating profit % | -16.9% | -22.8% | 1.3% | ||
| Number of own service centers at period end | 173 | 186 | 174 |
* Comparable currencies
CONFERENCE CALL
A conference call for investors, analysts and media will be held on May 4, 2021 at 3:00 p.m. Finnish time. In the call, President and CEO Jukka Moisio and CFO Teemu Kangas-Kärki will present the financial results.
To participate, please dial in 5−10 minutes before the beginning of the event:
Finland: +358 981 710 310
Sweden: +46 856 642 651
UK: +44 333 300 08 04
US: +1 631 913 1422
PIN: 19913175#
The call can also be listened live via www.nokiantyres.com/resultinfo-Q1-2021
A recording of the conference call and a transcript will be available on the company’s website later.
FINANCIAL REPORTING
Half Year Financial Report for January–June 2021: August 3, 2021
CAPITAL MARKETS DAY 2021
Nokian Tyres’ virtual Capital Markets Day 2021 for institutional investors and analysts is scheduled for September 9, 2021.
Releases and company information are available at www.nokiantyres.com/company/investors/.
Nokian Tyres plc
Päivi Antola
SVP, Corporate Communications and Investor Relations
Further information:
Jukka Moisio, President and CEO, tel: +358 10 401 7742
Teemu Kangas-Kärki, CFO, tel: +358 10 401 7750
Päivi Antola, SVP, Corporate Communications and Investor Relations, tel: +358 10 401 7327
Distribution: Nasdaq Helsinki, media, www.nokiantyres.com
Nokian Tyres develops and manufactures premium tires for people who value safety and sustainability. Inspired by our Scandinavian heritage, we craft innovative products for passenger cars, trucks and heavy machinery that give you peace of mind in all driving conditions. Our Vianor chain provides tire and car services. In 2020, the company’s net sales were EUR 1.3 billion and it employed some 4,600 people. Nokian Tyres is listed on Nasdaq Helsinki. Further information: www.nokiantyres.com