Pirelli confirms the targets for the year 2014 as announced in May 2014, thanks to higher revenues and profitability in the Consumer business thus counterbalance the Industrial business trend.
For the Consumer business revenue target increases to approx. 4.7 billion euro (vs. previous target of ∼4.6 billion euro) driven by:
- Higher volume growth (>6.5% vs. previously indicated >6%)
- Stronger Premium segment with volume growing above 16% (>14% was the previous indication)
- Improved Price/Mix (+4.5/5.5% vs previous target of +4/+4.5%)
- Lower negative impact from foreign exchange rates (∼-7.5%/∼-8.5% versus previously indicated ∼-8%/∼-9%)
These operating variables contributed to improve Consumer profitability with an Ebit margin before restructuring costs equal or higher than 15% (∼15% was the previous target).
For the Industrial business, we expect revenues for ∼1.5 billion euro (against the previous target of ∼1.6 billion euro) due to:
- 2% Volume reduction (the previous indication was ∼+4%/∼+4.5%) due to the truck and agro market slowdown in LatAm.
- Price-mix growth by +4%/+5% (against the previous target of +5%/6%) due to lower price increases (versus what was initially planned) deriving from the current scenario of natural rubber prices and from foreign exchange rates.
- Lower exchange rate negative impact (∼-11.0%/∼-11.5% vs. previously indicated ∼-11.5%/∼-12.5%)
As a consequence, profitability in the Industrial business (Ebit margin before restructuring costs) is expected to be equal or above 13.5% (vs. the previously announced target of ˜14%).