Michelin has reported a first-half net income loss of EUR137m (US$161m) and a 20.6% contraction in sales.
“After these recent months of unprecedented crisis, I want to express my immense pride in the remarkable engagement of our teams, which has enabled Michelin to fulfil its commitments to its customers, its communities and its partners,” said Michelin managing chairman, Florent Menegaux.
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“With this same determination, the Group has undertaken all the measures needed to secure the sustainability of its operations and attenuate the financial impact of the economic slowdown. In this still very uncertain environment, the Group pursues its competitiveness initiatives to maintain its leadership in the tyre businesses and drive deployment of its growth strategy.”
Outlook for 2020:
In 2020, after a first half shaped by the effects of the health crisis, notably the various restrictions on freedom of movement, Michelin says global tyre demand is expected to be impacted in the second half of the year by the economic recession ensuing from the pandemic.
Passenger car and Light truck tyre markets are expected to decline by 15% to 20% during the year and Truck tyre markets by between 13% and 17%. Given the relative resilience of certain segments, Speciality markets are expected to contract by 13% to 17%.
In the still highly uncertain market scenario, Michelin’s objectives are to deliver full-year segment operating income in excess of EUR1.2bn at constant exchange rates and structural free cash flow of more than EUR500m, barring any new systemic impact from COVID-19.
