Goodyear reports record results for first quarter 2016
Friday, April 29, 2016
Akron, OH - The Goodyear Tire & Rubber Company reported record results for the first quarter of 2016. “We are very pleased with our strong first quarter performance,” said Richard J. Kramer, chairman, chief executive officer and president. “Demand for our premium-branded, high-value-added products is robust and our product mix continues to grow richer, driving margin expansion,” he added. The company’s first quarter segment operating margin of 11.4 percent was up from 9.6 percent a year ago. “Our results are a reflection of our ability to successfully execute on our strategy,” said Kramer. “We will continue to focus on profitable growth in market segments where our innovation, brand and operational excellence capabilities provide a competitive advantage.” Goodyear’s first quarter 2016 sales were $3.7 billion, down from $4.0 billion a year ago, largely due to unfavorable foreign currency translation of $141 million and the deconsolidation of the company’s subsidiary in Venezuela. Tire unit volumes totaled 41.5 million, up 2 percent from 2015, driven by growth in the Asia Pacific region, primarily in Japan and China. Replacement tire shipments were up 2 percent. Original equipment unit volume was up 2 percent. Excluding the impact of the deconsolidation of Venezuela, unit volumes increased 3 percent. The company reported record first quarter segment operating income of $419 million in 2016, up from $388 million a year ago. The increase was driven by favorable price/mix net of raw materials and the impact of higher volume. These improvements were partially offset by the deconsolidation of the Venezuelan subsidiary and higher selling, administrative and general expenses. Core segment operating income, which excludes Venezuela, was $366 million in the year-ago quarter. Goodyear’s first quarter 2016 net income was $184 million (68 cents per share). Excluding certain significant items, adjusted net income was $195 million (72 cents per share). Per share amounts are diluted. Goodyear’s first quarter 2015 net income was $224 million (82 cents per share). Net income included a non-cash, one-time gain of $155 million ($99 million after taxes and minority interest) for the recognition of deferred royalty income resulting from the termination of a licensing agreement associated with the company’s former Engineered Products business. Excluding certain significant items, adjusted net income was $148 million (54 cents per share). Per share amounts are diluted.