Michelin reports growth in all tyre markets

Paris - Michelin's third-quarter results show continued growth across all tyre markets and all regions, led by growth in truck and speciality tyres and, regionally, by South America and China.

Total sales rose 23.8 percent, to Euro 4648 million ($6430 million) in the third quarter, resulting in a 19.4-percent jump in sales for the nine months ended 30 Sept, to Euro12 997 million. Much of the growth came from increased unit sales and an improved price mix, Michelin commented in a 26 Oct press announcement.

Michelin did not report earnings at this time but said it expects to report an operating margin of nearly 9 percent for year, based on the nine-month performance.

Unit sales in the quarter rose 13.8 percent, the company said, based on faster-than-expected growth in all tyre markets.

Passenger and light truck original equipment sales were up 32 percent overall from the depressed 2009 level, Michelin said, while replacement market sales grew 9 percent overall.

Growth in Europe trailed other regions, at 18 percent on OE sales and 9 percent on replacement sales, despite "buoyant demand in Russia," Michelin said.

North America and Asia led the OE growth, at 54 and 36 percent ahead of 2009, respectively, although replacement sales showed more modest growth, at 5 and 12 percent, respectively.

OE sales in South America and Africa grew 24 and 17 percent, respectively, and 20 and 4 percent for replacement passenger and light truck tyres.

In truck tyres, OE sales jumped 38 percent while replacement sales worldwide were up 18 percent for the nine months, said Michelin.

Growth here was led by Europe, at 45 percent and South America at 57 percent in OE sales, with replacement sales in these two regions being 29 and 37 percent, respectively. Orders for trucks in Europe continued to rise, but were still less than half the 2007 level, Michelin commented.

OE sales in Asia were up 38 percent for the period, powered by a 63 perent rise in the first half in China slowing by 4 percent in the third quarter, Michelin said. Replacement sales rose 13 percent across the region, while North American growth was 26 percent for OE and 19 percent on the replacement side.

African and the Middle East markets trailed, reporting OE growth of 8 percent, while replacement sales in the region rose just 2 percent, Michelin reported.

Michelin's speciality businesses - earthmover, agricultural, two-wheeler and aircraft tyres, as well as its maps and guides business - generated a 32.5 percent rise in the third quarter, reaching Euro603 million, with results for the first three quarters rising 12.4-percent higher to Euro1765 million.

The market for earthmover tyres in the third quarter, was almost back to pre-crisis levels, Michelin pointed out.

During the third quarter Michelin says it completed a Euro1.2-billion rights issue while its aircraft tyres continued to make inroads with aircraft manufacturers and airlines around the world.