Michelin raises profit targets after demand surges
STRONG demand helped boost full year figures for tyre manufacturer Michelin. The surge in business from Europe the United States and other areas have prompted the French company to raise its 2015 profit goal by a quarter.
Net income rose 39% to £1.224bn (€1.463bn), with sales volumes up 6.7% – due mainly to a strong first half.
Demand for new car and van tyres was strong in Europe and the US, up 7% and 10% on 2010 respectively. However, the stronger performance came from the truck tyre market with demand up 35% in Europe, 56% in the US and 120% in the Middle East, Africa and India market.
The rise in profit expectations is expected to be supported by new moves to exploit demand in the high growth economies.
The company, which has a large bus and truck tyre retreading facility in Stoke-on-Trent, is planning to start-up new operations in China and Brazil later this year.
“As a result, Michelin confirms its ambition to drive at least 25% growth and generate positive free cash flow over the 2011-2015 period, and has raised its 2015 operating income target to €2.5bn (£2.09bn),” it said in its results statement.
The company also announced that chief executive Michel Rollier would step down from his job at the May 11 shareholder meeting, with Jean-Dominique Senard succeeding him.
