Milan, Italy – Pirelli managed year-on-year revenue-growth of 1.6%, to €6.0 billion, for the full financial year 2016, the Italian tire-maker announced 31 March.
Earnings (EBITDA before non-recurring items) grew 2.4% to €1.18 billion, driven by “solid organic growth”. This was backed by a strong performance at its premium tire segment which Pirelli said now accounts for 64% of consumer tire sales.
The company linked the improvement to volumes growth, price/mix and efficiencies. These factors offset forex volatility, increased raw material costs and inflation in emerging markets.
The operating result (EBIT) was down 7% at €724.2 million, mainly reflecting a €66.6-million cost in non-recurring and restructuring charges.
The charges related particularly to the reorganisation of the Industrial Tire segment and a €105.8-million cost related to amortisations of intangible assets following the acquisition of Pirelli assets by Marco Polo - the investment vehicle set up by ChemChina to buy Pirelli shares.
Efficiencies, said Pirelli, totalled €90.5 million, bringing the total of efficiencies achieved since 2014 to €277.3 million. This amount is equal to 79% of the four-year target of €350 million by the end of 2017.
According to the Milan-based group, business trends improved in the fourth quarter, including in South America and Russia.
Volume improved 2.1% in 2016, with a 5.1% growth in the fourth quarter, mainly driven by the consumer tire business. Industrial tires’ volumes were negative with a 3.8% drop year-on-year as a result of the weakness of the South American market and slowdown in China.
The premium tire segment, said Pirelli, was “confirmed as the main driver of development”, with organic revenue growth of 12.3% to €3,24 million and volumes growth of 14.2% in 2016.
The segment had strong performance in Europe, North America and APAC where Pirelli said it is "consolidating its positioning".