PRESS RELEASE
Clermont-Ferrand, France - April 20, 2017
COMPAGNIE GÉNÉRALE DES ÉTABLISSEMENTS MICHELIN
Financial information for the three months ended March 31, 2017
First Quarter 2017 Michelin announces net sales of €5.6 billion, up 10%, with a 7.3% increase in volumes. 2017 guidance confirmed. |
Net sales
(in € millions) | First Quarter 2017 | First Quarter 2016 | % change |
Passenger car/Light truck tires & related distribution | 3,201 | 2,897 | +10.5% |
Truck tires & related distribution | 1,518 | 1,430 | +6.1% |
Specialty businesses
*
| 848 | 738 | +14.9% |
Group Total
| 5,567 | 5,065 | +9.9% |
* Specialty businesses: Earthmover, Agricultural, Two-Wheel and Aircraft tires; Michelin Travel Partner, BookaTable and Michelin Lifestyle Ltd.
Over the full year, tire markets are expected to track the trends observed in late 2016, in particular with the upturn in mining tire sales. For Michelin, most of the growth will be concentrated in the first six months, due to the early buying already occurring ahead of the price increases, and these will drive an improvement in margins in the second half of the year.
Michelin will continue to agilely manage prices so as to hold unit margins firm in businesses not subject to indexation clauses, given that higher raw materials costs will have a currently estimated impact of approximately €(900) million over the full year. As part of this process, new price increases have been announced in certain markets.
For the full year, Michelin confirms its targets of volume growth in line with global market trends, operating income from recurring activities equal to or exceeding the 2016 figure at constant exchange rates, and structural free cash flow of more than €900 million.
Market Review
First-quarter 2017
% change YoY (in number of tires) |
Europe
including Russia & CIS* |
Europe
excluding Russia & CIS* | North America |
Asia
(excluding India) | South America | Africa/India/Middle East | Total |
Original equipment Replacement |
+5% +6% |
+5% +5% |
+2% +3% |
+5% +7% |
+10% +3% |
+1% +2% |
+4% +5% |
*Including Turkey
In the first three months of 2017, the global original equipment and replacement Passenger car and Light truck tire market rose by 5% in number of tires sold, with robust demand in every region.
· Original equipment
· Replacement
First-quarter
% change YoY (in number of tires) |
Europe
including Russia & CIS* |
Europe
excluding Russia & CIS* | North America |
Asia
(excluding India) | South America | Africa/India/Middle East | Total |
Original equipment Replacement |
+9% +13% |
+9% +13% |
-8% +14% |
+16% +9% |
-4% +7% |
+2% -3% |
+9% +8% |
*Including Turkey
Global demand for new original equipment and replacement Truck tires rose by 8% in number of tires sold in the first three months of 2017, with retread markets stabilizing at a low level, particularly in Europe.
· Original equipment
· Replacement
OE demand also recovered in mature markets.
The infrastructure and quarry tire segments rose sharply, buoyed by early buying ahead of the price increases.
Replacement markets have been very volatile on the back of the announced price increases across the segment. Except for South America, where sugar prices are rising, the few favorable underlying factors seem to indicate that the market will remain stable over the full year.
Michelin Net Sales
(in € millions)
|
First Quarter 2017
| |
Net sales
| 5,567 | |
First-Quarter 2017 YoY Change in €m and % | ||
Total change
| +502 | +9.9% |
Of which volumes*
| +371 | +7.3% |
Price mix
| -3 | -0.1% |
Currency effect
| +128 | +2.5% |
Changes in scope of consolidation
| +6 | +0.1% |
*In tonnes
Net sales for the first quarter of 2017 totaled €5,567 million, a gain of 9.9% on the year-earlier period that was attributable to the following factors:
· Passenger car and Light truck tires & related distribution
Given the favorable currency effect, net sales stood at €3,201 million for the first three months of 2017, up 10.5% from €2,897 million in the year-earlier period.
· Truck tires & related distribution
First-quarter net sales, including the favorable currency effect, amounted to €1,518 million, up 6.1% from the €1,430 million reported in the year-earlier period.
· Specialty businesses
Net sales by the Specialty businesses stood at €848 million in the first three months of 2017, up 14.9% from €738 million in the year-earlier period. The favorable impacts from the 14% increase in volumes in markets up 9% to 11% and from the currency effect (mainly from the euro/US dollar exchange rate) were only partially dampened by the 2016 price adjustments.
First-quarter 2017 highlights
A full description of first-quarter 2017 highlights
may be found on the Michelin website:
http://
www.michelin.com/eng
Presentation and Conference call
The quarterly information for the period ended March 31, 2017 will be reviewed during a conference call in English later today (Thursday, April 20, 2017) at 6:30 pm CEST. Please refer to
http://www.michelin.com/eng
for practical information concerning the conference call.
You may follow the presentation with slideshow synchronization at http://www.michelin.com/eng
If you have any questions, please phone one of the following numbers:
Investor calendar
Tuesday, July 25, 2017 after close of trading
Thursday, October 19, 2017 after close of trading
Investor Relations
Valérie Magloire +33 (0) 1 78 76 45 37 +33 (0) 6 76 21 88 12 (cell) valerie.magloire@michelin.com Matthieu Dewavrin +33 (0) 4 73 32 18 02 +33 (0) 6 71 14 17 05 (cell) matthieu.dewavrin@michelin.com Humbert de Feydeau +33 (0) 4 73 32 68 39 +33 (0) 6 82 22 39 78 (cell) humbert.de-feydeau@michelin.com |
Media Relations
Corinne Meutey +33 (0) 1 78 76 45 27 +33 (0) 6 08 00 13 85 (cell) corinne.meutey@michelin.com Individual Shareholders Jacques Engasser +33 (0) 4 73 98 59 08 jacques.engasser@michelin.com |
DISCLAIMER
This press release is not an offer to purchase or a solicitation to recommend the purchase of Michelin shares. To obtain more detailed information on Michelin, please consult the documents filed in France with Autorité des Marchés Financiers, which are also available from the
www.michelin.com/eng
website.
This press release may contain a number of forward-looking statements. Although the Company believes that these statements are based on reasonable assumptions as at the time of publishing this document, they are by nature subject to risks and contingencies liable to translate into a difference between actual data and the forecasts made or inferred by these statements.