ERJ staff report (RPN)
Rubber & Plastics News.
Findlay, Ohio — Cooper Tire & Rubber Co. reported record first quarter operating profits of $96.7 million (€74.5 million), despite a drop of 12.5 percent in sales to $861.7 million. Net income for the quarter more than doubled to $62.8 million.
Cooper said its first quarter operating profits benefited from $90 million in lower raw material costs and $19 million in lower manufacturing costs. The latter reflected labour peace during the 2013 period; in 2012 the company's Findlay plant was hit by a nine-week lockout.
Significant offsets to earnings included $44 million of unfavourable pricing and mix and $15 million in lower volumes, Cooper said.
Cooper's North America Tire Operations more than tripled its segment profits to $71.4 million despite a 13.7 percent slump in sales to $602.3 million.
Cooper said its light vehicle tire shipments in the US fell 14 percent during the quarter compared with the overall market, which dropped about 1 percent.
The improved segment profits includes a $59 million drop in raw materials costs, $6 million in lower product liability costs and $23 million in lower manufacturing costs.
The company said raw material prices remained flat from the fourth quarter of 2012 to the first quarter of 2013, and prices are expected to decrease 1 percent in the second quarter. However, long-term raw materials prices are expected to trend higher with periods of volatility, Cooper said.
Cooper Chairman, CEO and President Roy Armes anticipates a challenging second quarter due to continued softness in global tire demand and weakness in the economy. Capital expenditures for 2013 are expected to be between $195 million and $215 million, near record levels.
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Article from Rubber & Plastics News