Pirelli sales, earnings lifted as markets recover

Milan, Italy – Pirelli & C. SpA has reported a strong growth in sales and earnings for the first quarter of 2021, helped by its ongoing industrial plan and higher volumes across both standard and high-value (18” and up) tire segments. 

Revenues for the first three months of the year were up 18.4% at €1.2 billion, due mainly to the recovery in demand in the main geographical areas, with a strengthening of market share in the main segments. 

Adjusted EBITDA (earnings) grew 9.1% to €266 million, while adjusted EBIT rose nearly 20% to €169 million, Pirelli reported 12 May.

Pirelli linked the increase in adjusted EBIT to improved internal levers (volumes, price/mix, efficiencies) which more than offset the negatives costs of raw materials, inflation, and currency impact.

Volumes rose 22.2%, reflecting growth in both high-value (29.3%) and standard (15.4%) tires, with a €96-million positive effect on earnings. 

Pirelli said there was a general recovery in the market, with its higher rim size tires performing “better than the global performance.” Furthermore, exposure to electric grew, with OE volumes increasing about 8 times compared to last year. 

Price/mix also contributed €16.0 million to earnings, offsetting the €11-million impact of raw materials costs and currency impact in South America, Romania and Russia.

Phase 2 of Pirelli’s competitiveness plan generated structural efficiencies of €25.8 million, compensating inflation of €10.8 million.

The plan also offset and a €15 million ‘reversal impact’ of the company’s Covid plan, which is expected to cost €29 million over the course of the year.