Hanover, Germany – Continental AG’s Rubber Group has published its third quarter 2016 results, posting a slight drop (0.7%) in earnings (EBITDA), to €821.5 million, on sales which came in virtually flat at around €4 billion.
For the first three quarters of 2016, the Rubber Group generated sales of €11.9 billion, up from €11.6 billion in 2015. Earnings for the nine months rose to €2.62 billion from €2.44 billion in 2015.
The outlook for the Rubber Group, as stated by Conti on 17 Oct, put sales at over €16 billion before exchange rate effects and with a projected adjusted EBIT margin of more than 17%.
For the full year, Conti expects €150 million of positive effect from lower raw material costs. The figures included an estimate of $1.40/kg for the average price of natural rubber (TSR 20) for 2016 and raised estimate for the price of butadiene, from $1.00/kg to $1.10/kg.
In the first nine months of 2016, R&D expenses rose by 14.4% compared with the same period of the previous year to €2.17 billion. This represented 7.2% of sales, some €281.2 million up from €261.7 million the previous year, related to the Rubber Group, corresponding to 2.4% of sales.
Over the nine months, the Rubber Group generally invested €710.9 million, up from €536.3 million in 2015, which was equivalent to 6.0% of sales.
In the Tire division, production capacity was expanded in North America and Asia as well as at European.
“There were major additions relating to the expansion of existing production sites in the US, China, Portugal, Slovakia, and Czechia,” said the German group.
ContiTech saw “major additions” relating to the expansion of production capacity for the Mobile Fluid Systems and Benecke-Kaliko Group business units, said the statement.
In particular, the group’s production facilities at German locations and in China, Hungary and the US were expanded and established.