France's Michelin cuts 2012 sales volume forecast on weak demand

27 July 2012 16:07  [Source: ICIS news]

LONDON (ICIS)--Michelin has lowered its forecast for 2012 sales volumes after weak demand in the first six months of the year in an uncertain market environment, especially in Europe, the France-based international tyre major said on Friday.

Michelin now expects a year-on-year decline in its tyre sales volumes of 3%-5% in 2012, compared with its previous forecast, from April, of stable year-on-year volumes.

However, Michelin expects the volume decline will be offset by lower raw material costs and favourable currency effects, it said.

For the first half of 2012, Michelin reported a 36% increase in operating income to €1.32bn ($1.63bn), despite the difficulties in the European car manufacturing industry.

While volumes fell by 8.3% year on year, primarily because of the weakness in Europe, Michelin benefited from “a limited negative impact from raw materials costs”, price increases, its global presence, and a focus on high-margin specialty tyres, it said.

Michelin’s sales for the six months ended 30 June rose by 6% year on year to €10.7bn, mainly because of price increases implemented in 2011 and continued positive effects from contractual indexation clauses based on raw materials costs, it added.

($1 = €0.81)

By: Stefan Baumgarten
+1 713 525 2653

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