Michelin has posted nine-month net sales to September, 2017 up 6% to EUR16.4bn (US$19.2bn) and confirms its guidance for the year.

The French supplier noted the tyre market was in line with the second quarter namely:

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  • Original equipment demand trending upwards in every segment
  • Replacement markets down slightly in the mature regions
  • Sustained rebound in mining tyre demand

Nine-month volumes rose 2.8%, lifted by early dealer buying in the first quarter, the recovery in mining tyre sales throughout the nine months and a return to normal dealer inventory levels

Acquisitions added 0.6% to growth, while faster improvement in the price-mix effect in the third quarter led to a positive 5%, for a total 2.6% impact during the first nine months, reflecting:

  • Implementation of all of announced price increases
  • Favourable mix effect, primarily reflecting 21% growth in volumes in the premium 18-inch and larger segment
  • The currency effect reduced net sales by 3.7% in the third quarter and was neutral during the full nine months

2017 guidance confirmed:

In the final months of 2017, regardless of prevailing winter weather conditions, replacement markets are expected to gradually move back in line with their long-term trend says Michelin.

112,000

Michelin employs more than 112,000 people worldwide

Source: QUBE

 Demand for original equipment tyres should continue to expand in the Truck, Earthmover and Agricultural segments, with slower growth in the Passenger car and Light truck business.

Sales of mining tyres, which have been rebounding since late 2016, should also continue to enjoy strong growth.

In the second half, changes in the price mix and raw materials costs are expected to have a net positive impact, as announced. For the full year, the impact of higher raw materials costs is currently estimated at around EUR800m.

For the full year, Michelin confirms its targets of volume growth in line with global market trends, operating income from recurring activities exceeding the 2016 figure, excluding the currency effect currently estimated at between EUR110m and EUR120m and structural free cash flow of more than EUR900m.

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