Nokian Tyres sees lower third quarter profits

By Liz White, ERJ staff

Nokia, Finland-Nokian Tyres plc has warned that its third quarter profits will be lower than those for the same period last year, and placed the blame for this partly on high existing stocks of winter car tyres at distributors. After high sales of winter tyres in the first half of 2005, sales growth slowed from July to September, Nokian said.

Expenses resulting from the development and start up of its Russian tyre plant near St Petersburg, as well as the setting up of new Vianor tyre retail outlets and tyre hotels, also "weakened the profits," Nokian added.

Finnish tyre maker Nokian said nevertheless that it expects net sales for 2005 to grow by more than 10 percent. The company's invoicing for Q3 rose by 6 percent, and cumulative sales growth was 14 percent, and, "the whole outlook for sales and profit development is better compared to the previous year," the tyre maker said in a 10 Oct statement.

Strong growth in sales of heavy tyres continues, the firm commented.

Nokian added that it predicts sales and profits will improve when consumer sales of winter car tyres start, and when its production in Russia rises. Overall, the firm said, it is "in a position to outperform the previous year's sales and profits" in both Q4 and the whole year.