ERJ staff report (DS)
Paris -- Michelin has posted strong results for the 12 months ended 31 Dec., 2007. Volumes were up by 3.2 percent, sales were up by 3.0 percent, and 6.5 percent on a ike-for-like basis. Operating income rose 22.9 percent, while net debt declined by 11 percent. Gross margin was 29.9 percent, up by 1 percentage point, while operating margin was 7.8 percent. The company generated Euro 472 million in free cashflow, despite significant restructuring charges.
Michel Rollier, Managing Partner said The company's growth was in some cases limited by available capacity. He added that the cash flow generated by the company will enable it t, "to forge ahead with our development, while simultaneously strengthening our financial independence."
Regionally, Michelin expects to see continued growth in Asia, South America and the Africa Mid-east area. This reflects the trends seen in the last six months.
By product, the company said it recorded, "Very satisfactory increase in passenger car and light truck tyre sales volume in 2007, after several years of modest growth; in the replacement segment, all regions posted substantial growth; the sales performance was particularly strong in Africa and the Middle East.
Benefiting from rather supportive markets, Truck tyre sales volumes posted sharp progress; the Group consolidated its commercial performance in a dramatically declining North American market.
Speciality tyre sales volumes recorded strong growth across all segments, said Michelin.
Overall, the company recorded operating profits of Euro 1645 million on sales of Euro 16 867 million. Cost of sales amounted to Euro 11 817 million, leaving a gross income of Euro 5050 million. All figures were broadly similar to the previous year. The company reduced its expenditure on R&D by Eur 20 million, to Euro 571 million, putting the R&D figure at just 3.3 percent of revenues. Michelin's general administration budget also fell by about 30 million Euro, to 937 million.
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Press release from Michelin