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PEERS & MARKETS

by Pirelli — Tue, 20 Oct 2009 12:47:28 +0000

The auto sector showed a positive trend for the week of October 12 – 16 with Pirelli among the best performers (with a 5.5% increase at 0.42 per share compared to the 2.6% increase of the DJ Stoxx Auto index). Morgan Stanley initiated coverage on Pirelli (“Maestro of Tyres from Italy to Brazil“) with an “Overweight” recommendation and target price of €0.45. There are several factors that make the stock attractive: guidance on the sustainability of the industrial plan does not completely reflect consensus forecasts, the presence in high-growth markets like in Brazil and reduced risks linked with Pirelli Real Estate after its increase in share capital.
Banca Aletti also gave a positive recommendation on the stock, publishing the first report on Pirelli this week with an Outperform recommendation and target price of €0.48.
Average ratings of stock analysts on Pirelli settle at €0.39; a “BUY” rating prevailing on coverage made by 18 business banks.
The week also ended in positive territory for the European tyre sector with a 4.5% increase for Michelin and 3.9% for Continental.
Pirelli RE ends the week at € 0.665, a 1.7% decline, however outperforming companies from the Italian real estate sector (Gabetti -7.1%, Aedes -6.4%, IGD +9.3%, Risanamento +2.9%).

For more in-depth information please follow the link to: Investors > Peers & Markets.

THE NEW CORPORATE ORGANIZATIONAL STRUCTURE GETS UNDERWAY

by Pirelli — Wed, 16 Sep 2009 19:36:10 +0000

Coherently with the strategy and the objectives of the 2009-2011 industrial plan that focuses on the core business, Pirelli simplifies its own organizational structure by grouping all activities directly supporting the core business under a new “Tyre and parts” Department, whose responsibility is entrusted to Francesco Gori, CEO and Managing Director of Pirelli Tyre. The reorganization will entail a significant downsizing of corporate level structures, leading to a minimum saving of 10 million euros per year, expected from 2010. The new “Tyre and Parts” Department groups the operational activities needed to develop the core business: tyres (Pirelli Tyre) and filters (Pirelli Eco Technology), thus ensuring one single management of corporate processes. In fact, the Department will incorporate the activities of Purchasing, Administration an Control, Pirelli Labs, Advertising and Events, Human Resources, Healt Safety & Environment (which also reports to the Group General Counsel), and the Service Centers for information technology and administratives activities.
In line with the focus on industrial activities, the reorganization includes the closing the Operation Department, headed by Claudio De Conto who will now focus his activity, as CEO Finance, on Pirelli Real Estate. Together with Giulio Malfatto – the other CEO of Pirelli RE – Claudio De Conto will continue to manage the turnaround process, which has been successfully pursued so far.
Therefore all lines of business (“Tyres and Parts“, Real Estate, Environment, Pzero fashion and Broadband Solutions), as well as typical institutional activities will report directly to the Chairman, Marco Tronchetti Provera.

PIRELLI ECO TECHNOLOGY ARRIVES TO CHINA

by Pirelli — Tue, 15 Sep 2009 19:10:00 +0000

Pirelli signed a memorandum of understanding with the Hixih Group, a pneumatic manufacturer partner of the Pirelli Group since 2005; the agreement concerns the realization of a filter production plant in Yanzhou. The understanding falls within the scope of memorandums signed with the Italian Ministry of Territorial Protection, Water and Environment and will lead to the realization of a new factory, whose construction is expected for the first quarter of 2010. This new facility will be located in province of Shandong, where the two truck and car tyre production sites are located, hence creating a new diversified industrial development centre, capable of using the synergy from the production and from the commercialisation of the two products. The expended investment according to the 2009-2011 industrial plan, could arrive to 50 million euros within this three-year period (15-20 million euros for Eco Technology), entailing a productive capacity of about 100 thousand filters per year and about 1,200 employees.

PIRELLI RE'S SUCCESSFUL CAPITAL INCREASE

by Pirelli — Wed, 08 Jul 2009 16:12:42 +0000

Pirelli RE approx. 400 million Euros capital increase has succesfully been made: 99.4% being the overall total of new shares underwritten. Pirelli & C. supported it with 58.07% of the new shares. Yet, the deal was also widely supported (41.3%) by istitutional and retail investors with an overall underwritten amount worth approx. 164.9 million Euros (41,3% of the total). Though this capital increase, Pirelli RE makes its assets structure stronger, with a 0.7 debt – net asset ratio vs. 2.8 at the end of the first quarter 2009.

This capital increase shall also guarantee the flexibility needed to achieve the goals of the 2009-2011 Industrial Plan that was introduced on February 11.

The negotiation deadline will be Friday July 17, the last day available for trading the shares not yet underwritten (0.639% of the total).

80 YEARS OF HISTORY IN BRAZIL

by Pirelli — Thu, 02 Jul 2009 16:46:36 +0000

Pirelli has been active in Brazil since 1929, a country holding a leading position in both cars and industrial vehicles markets in the South American continent and one of the major markets worldwide. The Santo André plant that became part of the Group 80 years ago is Pirelli’s production and technological core in Brazil.

Pirelli’s 80 year presence in Brazil was celebrated with a special event & exhibition titled: “80 years of history. A way to leadership” which highlighted the business landmarks of the Group in Brazil where Pirelli is active. Industry first and foremost, but also sports, communications as well as social and cultural events that left a mark within the country’s history and are still often remembered across the world.

Brazil is a critical market for Pirelli’s Tyre business: in 2008, it accounted for 33% of the overall sales that were over 4,1 billion Euros. Pirelli can count on an absolute leading position in both the OEMs and replacement business and the Group has a distribution network of over 600 exclusive sales outlets.

Out of the 23 Pirelli Tyre facilities, 7 are located in the Latin American continent and five of them are in Brazil. 90% of Pirelli Tyre’s Latin American production is made in Brazil, while 35% of the country’s production is being exported.

Pirelli’s R&D is into «sustainable development» in Brazil too, in line with the «Green Performance» goals of its 2009-2011 Industrial Plan. In agreemnt with the local authorities, the Group will purchase natural rubber produced with eco-sustinable processes in the Xapuri region with the purpose of protecting the environment as well as contributing to the economic development of the natives.

BRAZIL: THE FUTURE IS NEW INVESTMENTS

by Pirelli — Thu, 02 Jul 2009 16:21:03 +0000

Investments worth 200 million USD and a 10% sales growth between 2009 and 2011. These are the goals announced by Pirelli’s Management during the celebrations of the 80 years of business in Brazil.

In line with the 2009-2011 Industrial Plan and with the goal of consolidating the Group leadership in the South American markets, Pirelli will invest in Brazil 200 million USD in the three years from 2009 through 2011 to be added to the 100 million USD already invested in 2008.

These new investments will increase the production by 20% in the car and bike tyre businesses. One third of the overall amount of 300 million USD invested from 2008 through 2011 will be allocated to R&D while the remaining two thirds will be invested in production capacity increase and quality improvement.

From 2004 to 2007, 300 million USD had already been invested in the Brazilian facilites to provide technological innovations, product portfolio updates as well as the increase of production capacity (over 25% in all main segments over that period).

Between 2005 and 2008, Pirelli’s sales in South America grew on the whole by 21%, and in 2008 exceeded for the first time the record figure of 2 billion USD. Brazil accounted for 60% of this result. In the three years from 2009 to 2011, Brazil’s new target for growth is a + 10% vs. 2008, although the 2009 results will be impacted by the strong pressure on demand worldwide.

PIRELLI RE IS FOCUSED ON SERVICES

by Pirelli — Wed, 27 May 2009 17:55:59 +0000

Pirelli Re continues with its streamlining program : the Board of Directors approved the agreement to sell 20% of Pirelli Credit Servicing, the corporate entity focused on the management of «non-performing loans» to Dgag International (Calyon Sa). This was a decision in line with the 2009-2011 Industrial Plan guidelines setting forth a gradual reduction of Pirelli Re‘s financial committment in the «non-performing loans» business as well as its greater focus on services.
Based on the agreement reached, Dgag International will become part of Pirelli Re through a reserved capital increase worth 6.6 million Euros, with an enterprise value following the capital increase of approx. 36 million Euros and a 33 million Euros equity value. The deal generates for Pirelli Re a 3 million Euros gross capital gain, with a positive impact on its net financial position of approx. 89 million Euros, shareholders’ funding included. The closing is to take place at the end of June.

BUY PIRELLI TYRES AND TRAVEL FREE

by Pirelli — Thu, 26 Mar 2009 19:01:28 +0000

Pirelli launches its incentives to replace old tyres with Pirelli eco-compatible ones. In collaboration with Eni, the Pirelli Group can now offer discounts of up to 60 euros on fuel purchases. To receive them, just change your old tyres – worn beyond the legal limits (1.6 mm of tread) – with “green” Cinturato radial tyres. What makes this different from traditional incentives is how it is supplied: this initiative is wholly self-financing, and Pirelli bears all the costs. No government contribution, then, to a measure that is designed to revive the tyre market and stimulate sales of products with low environmental impact.
The initiative falls within the guidelines of the Pirelli 2009-2011 industrial plan, published in February, for the development of increasingly innovative and ecological solutions and products.
Scrapping worn tyres and replacing them with new “green” ones fulfils three of Pirelli’s aims: ensuring road safety, providing an anticrisis stimulus to support market demand in an unfavourable economic scenario and encouraging consumers to opt for products with low environmental impact. The scheme will run from the end of May to the end of July 2009.
The initiative was presented in Rome today by Pirelli Chairman Marco Tronchetti Provera, and the Chief Executive Officer of Pirelli Tyre, Francesco Gori, as part of an event attended by Altero Matteoli, Minister of Infrastructure and Transport, Adolfo Urso, Undersecretary of State for Economic Development and International Trade, Mario Valducci, Chairman of the Transport, Post and Telecommunications Commission of the Chamber of Deputies, and Andrea Mondello, Chairman of Unioncamere, the national umbrella organisation for Chambers of Commerce throughout Italy.

PIRELLI LAUNCHES THE NEW CINTURATO P7

by Pirelli — Thu, 26 Mar 2009 18:40:23 +0000

New ideas from Pirelli are not confined to incentives to purchase low environmental impact tyres. Today saw another launch – during an event at the Temple of Hadrian, Pirelli brought forward the presentation of its new radial tyre, the Cinturato P7. This new product complies with the new European anti-pollution regulations that will come into force in 2012. The tyre, the latest developed by the Group’s Research and Development centre, represents a product that is innovative in several different respects. Firstly, in its low environmental impact: the Cinturato P7 is able to reduce the fuel consumption and carbon dioxide emission levels of a vehicle by an average of 20%, also contributing to lower sound pollution by up to 20%. Road safety is assured by high performance when braking or in curves, guaranteed on both wet and dry surfaces. The Cinturato P7 is manufactured with a new mix developed by Pirelli that uses increasingly “green” materials.
In accordance with the 2009-2011 Industrial Plan, the new Cinturato P7 combines ecology and high performance, energy saving and lower environmental impact, and safety and driving comfort.
The Cinturato P7, available from May, has already been adopted by the major motor vehicle manufacturers.
Pirelli Labs are engaged in research seeking to drastically reduce environmental impact by using “green” technologies, from the mix to the tyre structure, without lowering the safety parameters of the vehicle. In particular, for the mixes, Pirelli is engaged in the development and use of a series of increasingly ecological new materials. Before the end of 2009 the Italian group will be able to use rice bran – a by-product of rice processing that has no food use – as a component in tyre production. Using this natural product will allow the use of synthetic substances to be reduced, decreasing pollution.

LINK:

http://www.pirelli.co.uk/web/car-suv-van/cinturato_family/all_about_cinturato/cint_p7/default.page