Nokian sales, profit drops as European car market struggles

ERJ staff report (LMH)

Nokia, Finland – Nokian Tyres Group’s first quarter net sales fell by 13.3 percent year-on-year to €333.1 million. Operating profit for the quarter was €76.3 million, down 27.3% from Q1 2012.

The Finnish company said a tough environment in Europe, with car sales and replacement tire demand down, affected sales for the quarter. Kim Gran, Nokian CEO, said the tire maker's strong market leader position in the core markets of Russia and the Nordic companies helped it to “book reasonable Q1 results.”

Gran added that the company does not foresee any major improvement in the market for 2013, but Nokian aims to grow on the back of its renewed winter tire range by expanding distribution.

Russia was the strongest market for the company, where Q1 sales increased year-on-year by 2.8% to €176.3 million. Sales in CIS (Commonwealth of Independent States) countries, excluding Russia were €10 million, up from €9 million in Q1 2012.

In 2013, Nokian expects demand for replacement car tires to be at the same level as 2012 in Nordic countries, but to remain weak in central Europe. It said in Russia, demand is estimated to show growth in winter tires, but remain flat for summer tires.

We are looking into the rest of 2013 with confidence,” Gran said in a 30 April financial report . “After a slow start for the year in Q1 we expect the market to present us with some growth opportunities.”

News release from Nokian Tyres