Hanover, Germany – Continental Corp.’s Rubber Group – comprising its tire division and ContiTech unit – has posted a 3.9% year-on-year improvement in third quarter sales, at €4.6 billion.
Operating earnings (adjusted EBIT), however, decreased 0.6% for the three months, due in part to the weak global automotive market, the company reported 12 Nov.
For the first nine months of the year, the segment’s sales rose 3.4% to €13.4 billion, while adjusted operating results were down 6.1% at €1.4 billion.
The segment’s results were described by Continental’s CFO Wolfgang Schäfer as “stable” – helped particularly the company’s diversified markets.
“We have been focusing for a long time on boosting our industrial and end-customer business. This makes us more independent from the trends on the international automotive markets,” Schäfer commented.
For the group as a whole, Continental reported a 2.9% rise in third-quarter consolidated sales to €11.1 billion, while adjusted EBIT stood at €768 million, 20% lower than in the same quarter in 2018.
Commenting on the performance, CEO Dr. Elmar Degenhart said the company was pursuing its 2019–2029 restructuring programme to enhance its long-term competitiveness.
“It is a challenging but essential process to ensure our viability. We are thus responding proactively to the crisis in the automotive industry and, like 10 years ago, we will emerge stronger,” Degenhart stated.
Continental launched a major 10-year restructuring programme in September, involving a strategy to focus on “growth areas.” The programme envisaged up to 20,000 job cuts.
Growth areas identified by the company include assisted and automated driving, connected driving, mobility services, the tire business, as well as the industrial and end-customer business (ContiTech).
Degenhart also confirmed the annual targets for the current fiscal year, which had been adjusted in July 2019.
The company anticipates that full-year sales will come in at about €44-45 billion and the adjusted EBIT margin at about 7-7.5%.