Boulder City, Nevada – Polyurethane tire-maker Amerityre saw sales fall by around 20 percent in the third quarter of 2016 to $937,000 (€821,000), compared with $1.2 million in the same period in 2015.
Gross profit declined by 6 percent to $313,000 in the period, according to a filing with the US Securities and Exchange Commission. The company operates in three segments: closed-cell polyurethane tires, polyurethane elastomer forklift tires and agricultural tires.
The closed-cell polyurethane tires segment sells to original equipment manufacturers, distributors and dealers and accounts for the “majority of our revenue,” the firm said.
Production of polyurethane elastomer forklift tires is to be relaunched in Q4 2016, Amerityre said. “We expect sales in this market segment to increase in the coming quarters as new products are introduced and gain market acceptance.
The agricultural tires business, it noted, faces a tough year “as sales of agricultural tires are being hit by the downturn in farm commodity prices. This has reduced farm income levels and available money for investment in equipment.
“Our experience is consistent with the reports provided by large agricultural equipment suppliers, several who have announced expectations for another challenging year in 2016.
Despite growing market acceptance of its pivot tire and seeder tire technologies, financial considerations have forced potential agricultural tire customers to delay purchases, the company added.
Given this backdrop, The PU tire market does not expect major agricultural sales gains for FY 2017 compared to FY 2016.
“We continue to pursue additional distribution relationships, both domestically and internationally, to increase our market penetration for our agricultural tires. We have found that the strength of the US Dollar versus other foreign currencies has negatively impacted our international business. We expect that exchange rate effects will continue to dampen our international sales efforts in the coming quarters,” the firm said.