Sustainability Channel

Sustainability Channel is the communication channel towards our stakeholders interested in Sustainable approach to the business.


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2012: Profitability target achieved

Milan, Pirelli & C. SPA SpA Board approves 2012 results

PIRELLI & C. SPA BOARD APPROVES 2012 RESULTS

RECORD PROFITABILITY THANKS TO FOCUS ON PREMIUM AND EFFICIENCIES

2012 PROFITABILITY AND NET FINANCIAL POSITION TARGETS ACHIEVED

TOTAL INVESTMENT 471 MILLION EURO

RETURN ON INVESTMENTS (ROI) 19.2%

STRONG NET PROFIT GROWTH

PIRELLI & C. GROUP

- EBIT: +34.2% AT 780.8 MILLION EURO (581.9 MILLION EURO ON 31 DECEMBER 2011)

- OVER THREEFOLD EBIT INCREASE IN LAST 3 YEARS, +212% FROM 250 MILLION EURO IN 2009 ON LIKE-FOR-LIKE BASIS

- BIT MARGIN GROWS TO 12.9% FROM 10.3% ON 31 DECEMBER 2011 (COMPARED WITH TARGET OF “ABOUT 13%”)

- NET PROFIT: +27.4% TO 398.2 MILLION EURO (312.6 MILLION EURO IN 2011 BEFORE NON-RECURRING IMPACTS) ). TOTAL NET PROFIT IN 2011 WAS 440.7 MILLION EURO AFTER A POSITIVE IMPACT OF 128 MILLION EURO LINKED TO DEFERED TAXATION
- REVENUES: +7.4% TO 6,071.5 MILLION EURO ( 5,654.8 MILLION EURO ON 31 DECEMBER 2011)

- PREMIUM SEGMENT GROWTH CONTINUES: REVENUES +20.9% TO 2,075.4 MILLION EURO AND VOLUMES +12.6%

- NET FINANCIAL POSITION NEGATIVE 1,205.2 MILLION EURO , A MARKED IMPROVEMENT COMPARED WITH 1,868.8 MILLION EURO ON 30 SEPTEMBER 2012 (COMPARED WITH TARGET OF “ABOVE OR EQUAL TO 1.2 BILLION EURO”)

PIRELLI TYRE


- EBIT: +25.7% TO 809.1 MILLION EURO (643.9 MILLION EURO ON 31 DECEMBER 2011)

- EBIT MARGIN GROWS TO 13.4% FROM 11.5% ON 31 DECEMBER 2011

- CONSUMER BUSINESS EBIT MARGIN AT 14.3% (12.5% ON 31 DECEMBER 2011)

- INDUSTRIAL BUSINESS EBIT MARGIN AT 11.1% (9.1% ON 31 DECEMBER 2011)

- REVENUES: +7.7% TO 6,031.3 MILLION EURO ( 5,601.6 MILLION EURO ON 31 DECEMBER 2011

- BOARD TO PROPOSE TO SHAREHOLDERS THE DISTRUBITION OF A DIVIDEND OF 0.32 EURO PER ORDINARY SHARE (0.27 A YEAR EARLIER) AND 0.39 EURO PER SAVINGS SHARE (0.34 EURO A YEAR EARLIER)

- BUYBACK PROPOSAL TO SHAREHOLDERS APPROVED

- NOTHWITHSTANDING STRONG RESULTS’ GROWTH, MANAGEMENT WILL NOT RECEIVE THE VARIABLE BONUS FOR THE YEAR 2012 BECAUSE THE THRESHOLDS OF ACCESS IN THE INCENTIVE PLAN WERE NOT REACHED

***

2013 TARGETS

CASH GENERATION BEFORE DIVIDENDS POSITIVE AND ABOVE 200 MILLION EURO, EQUAL TO ABOUT 3% OF SALES

NET FINANCIAL POSITION BELOW 1.2 BILLION EURO

INVESTMENTS OF ABOUT 400 MILLION EURO, OVER 70% OF WHICH EARMARKED FOR THE PREMIUM SEGMENT, MIX AND QUALITY ENHANCEMENT. AT THE END OF 2013 PREMIUM CAPACITY WILL BE 33 MILLION PIECES (48% OF THE TOTAL), OF WHICH 63% LOCATED IN LOW COST COUNTRIES AND 60% IN NEW FACTORIES

CONSOLIDATED EBIT BETWEEN 810 AND 850 MILLION EURO WITH A MARGIN IN LINE WITH OR SLIGHTLY HIGHER THAN 2012 AFTER HAVING FINANCED:

- RESTRUCTURING COSTS OF AROUND 30 MILLION EURO

- GREATER MARKETING AND COMMERCIAL COMMITMENTS AIMED AT IMPROVING THE COMPETITIVE POSITIONING IN THE PREMIUM SEGMENT

- INDUSTRIAL COSTS FOR THE CONVERSION OF CAPACITY FROM STANDARD TO PREMIUM AND DEVELOPMENT IN RUSSIA AND MEXICO

- GROWING DEPRECIATION RELATED TO THE INTENSE INVESTMENT ACTIVITY OF THE LAST TWO YEARS AND THE WIDENING OF THE PERIMETER FOR NEW ACQUISITIONS

CONSOLIDATED EBIT WILL INCLUDE CONTRIBUTIONS FROM:

- THE CONSUMER BUSINESS WITH A MARGIN OVER 14% ON SALES FORESEEN AT AROUND 4.6 BILLION EURO

- THE INDUSTRIAL BUSINESS WITH A MARGIN OF AROUND 12% ON SALES OF AROUND 1.7 BILLION EURO

TOTAL REVENUES FORESEEN AT BETWEEN 6.3 AND 6.4 BILLION EURO DERIVED FROM:

- VOLUMES WHICH ARE EXPECTED TO GROW BETWEEN 3% AND 4%. PREMIUM WILL DRIVE DEVELOPMENT WITH A GROWTH RATE BETWEEN 13% AND 14%

- PRICE/MIX BETWEEN +4% AND +5%

- EXCHANGE RATES AT AROUND -4%