Conti improves Tires earnings despite lower sales

Hanover – Continental AG’s rubber and tire operations have reported higher third quarter earnings margins despite lower sales both within the Tires and ContiTech groups.

The Tires group reported 1.2% year-on-year increase in earnings (EBITDA) to €637 million during the three months to end of September, on 5.4% lower sales of €3.4 billion, Continental announced 8 Nov.

Sales decline, the German group said, was due to declining volumes in the tire-replacement business.

The business unit, however, improved its earnings margin to 13.2%, from 11.8% reported last year, on “continued high share of premium tires as well as lower raw material costs.”

In particular, Continental said, the performance was achieved despite declining European and North American markets in the tire-replacement business.

The German group’s industrial and materials arm, ContiTech remained stable for the quarter with both sales and earnings flat during the three months.

The group sector recorded earnings of €170.3 million, on a par with last year, on 1% lower sales of €1.7 billion.

Adjusted earnings margin was up slightly at 6.6%, compared to 6.3% reported in 2022.

The margin improvement, Continental said, was due mainly to inflation-related price adjustments.

Looking ahead, the German group slightly raised its adjusted earnings margin outlook for the tires segment, now expecting it come around 12.5% to 13.5%, compared to a previous estimate of 12% to 13%.