The Goodyear Tyre & Rubber Company has reported record first quarter sales of $US4.9bn, a 2% increase over Q1, 2005.
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The tyre maker reported net income of $74m (37 cents per share), up 9% compared to $68m (35 cents per share) a year ago.
Total segment operating income was $311m, a 7% increase compared to $292m in 2005. Operating income benefited from higher selling prices and improved product mix of $166m, as well as favourable settlements with certain suppliers and a pension plan change in Latin America.
Higher raw material costs of approximately $185m had a negative impact on the quarter.
Sales increased due to higher pricing and a more-favourable product mix, largely in the company’s North American tyre business. Currency effects reduced sales by approximately $74m. The year-ago quarter included approximately $79m in sales from businesses divested during 2005.
Three of Goodyear’s business units achieved record first quarter sales.
“Sales increases were driven by strong revenue per tyre growth of 7% as we focus our efforts on the high performance, profitable segments of the tyre market,” said Goodyear chairman and chief executive officer Robert Keegan.
“[We are] delivering solid results despite a more difficult environment and a tough year-ago comparison,” he added.
The 2006 quarter benefited from after-tax items including favourable settlements with certain raw material suppliers of $32m (15 cents per share), a pension plan change in Latin America of $13m (6 cents per share), and income of $10m (5 cents per share) from a Latin American legal settlement.
Negatively impacting the quarter was an after-tax charge of $30m (15 cents per share) for restructuring.
In addition, Goodyear recognized total after-tax expenses of $6m (3 cents per share) for stock options and grants of other stock based incentive awards during the first quarter.
The prior-year quarter included net income of $9m (4 cents per share) from businesses divested during 2005.
