ERJ staff report (TP)
Nokia, Finland – Nokian Tyres published its Annual Report 2013 last week and said its strong market leader position in Russia and Nordic countries improved further in 2013 as it managed again to increase both market share and distribution footprint.
Kim Gran, President and CEO, said: “Despite the headwind from the markets in 2013 we maintained a reasonably good level of profitability and provided strong cash flow. The company is debt free with a strong balance sheet, which gives us a good platform to create further growth and improve owner value.”
The expansion of its distribution network in CE (car export) sales is starting to “pay dividends” with sales volumes increasing faster than the average market demand. There was “clear” growth in Germany, Poland and France.
Its sales mix was “strong securing an almost flat ASP [average selling price] in a challenging market”.
Net profit was hit hard by additional taxes of €100.3m in Finland.
Gran said: “We strongly disagree with the tax decision, which we consider to be in conflict with legislation and tax agreements. We will appeal against this decision in all instances necessary, and trust that the decision will be revised.”
Growth is still slow in Russia and the Nordic countries, but both Central Europe and North America are expected to improve clearly.
The company had “a major overhaul” of key winter products – five new product ranges were introduced in 2013.
The “biggest launch ever” included the new generation of studded Nokian Hakkapeliitta 8 and non-studded Hakkapeliitta R2 targeting further growth in core markets.
There was expansion of its distribution network with 169 new Vianor stores opened – now totalling 1,206 stores in 27 countries. In Russia, Nokian dealership programs now include nearly 3,300 tire stores and car dealers.
A new “softer partner franchise” model called Nokian Tyres Authorised Dealer (NAD) has also been rolled out with 432 shops contracted in Europe and China. Its objective is to continue to expand distribution, and to open 140 new Vianors and double the amount of NADs in 2014.
Two new lines (12 and 13) were commissioned in its new Russian factory, which took the annualised capacity in Russia to more than 15m tires.
This is an external link and should open in a new window. If the window does not appear, please check your pop-up blocking software. ERJ is not responsible for the content of external sites.
Press release (letter from Kim Gran) from Nokian Tyres
Press release (40-page PDF) from Nokian Tyres