Results as of September 30, 2014
2014 Nine Months Results point to the growth of the main economic indicators, due to:
- strong growth in the Premium segment (56% of net sales in the Consumer Business +5pp vs the first nine months of 2013), with volumes surpassing expectations to rise +20.1% and a consequent strengthening of Pirelli’s positioning in all geographic areas;
- the improvement in price/mix to +4.7% (+4%/+5% is the target set for 2014);
- the positive performance of the business in Europe, Asia Pacific and NAFTA, with overall net sales growing faster than the Group average, and the improvement in operating income (EBIT) that attenuates the effects of the current slowdown in the South American market;
- the turnaround of the business in Russia, characterized by a decisive improvement in product mix and positive high single digit EBIT margin;
Consolidated Revenues at 4, 528.7 million euro, with organic growth of 6.5% compared with the corresponding period of 2013 (-1.3% after the negative forex impact).
Operating result (Ebit) at 629.7 million euro, +8.9% compared with 578.2 million euro in the same period of 2013, a testament to the efficacy of the value creation strategy; profitability (Ebit margin) at 13.9%, an improvement of 1.3 percentage points. The improvement in Ebit was linked to:
- the growing contribution made by price/mix which, together with lower commodity costs, more than offset the negative currency translation effect, with a net balance of euro 82.2 million;
- the positive contribution of volumes (euro +40.7 million);
- euro 71 million in efficiency gains, which mitigated the inflation in production factors
These variables compensated the impact of higher depreciation and other costs (euro 57.4 million, of which 23 million euro for greater commercial costs linked to future Premium growth) and the increase in non-recurring expenses (euro 3.8 million).
Net profit, including “discontinued operations”, stood at 300.0 million euro, with an increase of 16.2% compared with 258.1 million euro in the same period of 2013.
Net Debt at 2,003.9 million euro, with limited growth compared to 1,935.2 million euro on 30 June 2014 (1,322.4 million at the end of 2013), in line with the business seasonality.
The main 2014 targets are confirmed: Ebit of 850 million euro, lower Investments worth 400 million euro, Cash Generation before dividends over 250 million euro, Net Financial Position at approximately – 1.2 billion euro.
2014 revenues expected at between >6.1 billion and <6.2 billion euro, slightly below the previous forecast (~6.2 billion euro forecast last August)