GERMANY: Continental has strong first quarter
Continental says it has laid the foundation for another successful year by improving sales and earnings in the first three months more than expected.
"We've had a very good first quarter, which was characterized by an overall gratifying development in car production, especially in Europe and Asia. Other positive factors were the increases in replacement sales for passenger and light truck tires in Europe and North America, where we upped earnings significantly," said Continental Executive Board chairman Manfred Wennemer on Wednesday in Hanover.
"Backed by these positive results for the first three months, we're highly confident that we will again improve sales and operating result in absolute terms and thus dependably achieve our goals for the year."
However Wennemer warned that raw material prices are an uncertainty. "We [...] are currently expecting them to stabilize at a high level on the whole."
Consolidated sales for the first quarter of 2007 rose by 9.8% compared with the same period of the previous year to EUR3,964.8m (previous year: EUR3,611.6m).
The acquired automotive electronics business of Motorola contributed EUR284.6m to sales. Before changes in the scope of consolidation and exchange rate effects, consolidated sales were up 6.5%.
EBIT rose by 24.0% to EUR436.8m (previous year: EUR352.4 million).
Wennemer pointed out that the company is further strengthening its R&D capabilities. Compared with March 31, 2006, research and development expense was up 18.6% to EUR185.2m (previous year: EUR156.1m), representing 4.7% of sales (previous year: 4.3%).