Nokian Tyres management has approved the company’s revised mid-term strategy and updated financial and non-financial targets.
The board outlined the following mid-term financial goals:
- Growing faster than the market: Net sales EUR2bn (US$2.4bn)
- High returns and profitability: Segments operating profit and segments ROCE at the level of 20%
- Growing ordinary dividend: Dividend above 50% of net earnings
“Our large investment phase is completed and we are well positioned for organic growth and strong performance,” said Nokian Tyres president and CEO, Jukka Moisio.
“With our current manufacturing capacity, a valued brand and a world-class team, we are now ready to take an ambitious leap forward to become a EUR2bn revenue company. We will continue to improve operational and commercial performance, which, together with the growing markets, will propel our company to the next level in the years ahead.”
The global tyre market is expected to grow by around 5% annually by 2024.
Macro trends, such as an increasing number of new car models, rising SUV and CUV penetration and climate change mitigation, are driving demand for sustainably produced tyres.
The supplier has launched a record number of new products in 2020–2021 and will continue to strengthen its competitiveness and positioning.
Reinforcing Nokian Tyres’ brand in the regions will be an element in closer collaboration with customers. Profitability improvement will be driven by increasing volumes and operational efficiency.
Nokian Tyres is introducing new non-financial targets and embedding them throughout core operations.
Non-financial targets focus on bringing new environmental and safety innovations to products, reducing CO₂ emissions in line with the Science Based Targets, further improving workplace safety and monitoring sustainability of suppliers.
Nokian Tyres will, for example:
- Increase the share of either recycled or renewable raw materials in tyres to 50% by 2030
- Reduce CO₂ emissions from both raw materials and tyres by 25% between 2018–2030
- Decrease accident frequency (LTIF) yearly by 20%
- Sustainability audit 100% of critical active suppliers by 2025