Goodyear has reported increased second quarter sales up 15% compared to last year, with tyre performance improving across all four of the company’s business segments.
Net income was up by US$249m, while North America’s tyre segment operating income increased by more than US$100m. Year-to-date cost savings exceeded $280 million.
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“We are very pleased with our strong performance in the second quarter and first half of the year,” said Goodyear president and CEO Richard Kramer. “Our businesses continue to perform better than a year ago as they capture the benefits of recovering industry demand, strong new product performance and solid productivity improvements.
“We are clearly on the right path as our strategies position us to grow profitably as markets continue to improve.”
Kramer noted that improved results in the company’s North American tyre business unit made a significant contribution to the second quarter result.
“These results are further evidence of the effectiveness of our strategy to drive innovation, improved mix and operational efficiency in the business,” he said.
Second quarter 2010 sales were US$4.5bn, up 15% from the 2009 quarter, while second quarter sales reflected the US$304m impact of a 10% increase in tyre unit volume due to improved global demand.
Sales were also positively impacted by US$161m from higher sales in other tyre-related businesses, primarily third-party chemical sales in North America, and by an improved price/mix.
Unfavourable foreign currency translation reduced sales by US$37m.
Improved price/mix of US$121m in 2010’s second quarter more than offset US$54 million in net higher raw material costs – $89m before raw material cost reduction actions.
Unfavourable foreign currency translation reduced segment operating income by $14m.
Goodyear’s second quarter 2010 net income was US$28m compared with a loss of US$221m in the 2009 quarter.
“Raw material costs remain a challenge and we continue to see an uncertain economy, but we remain focused on the proven strategies that have enabled us to address these headwinds over time,” Kramer said.
