Pirelli earnings rise on stable first quarter revenue

Milan, Italy – Pirelli & C. SpA has increased its first quarter adjusted earnings (adjusted EBITDA) by 4.6% year-on-year, helped by improved price/mix and volumes.

The Italian tire maker reported adjusted earnings of €376 million, on stable sales of €1.7 billion for the quarter ended 31 March.

Adjusted EBIT rose 5.8% year-on-year to €262 million, with adjusted EBIT margin improving to 15.5% from 14.6% reported last year.

Volumes for the quarter rose 2.3% year-on-year with price/mix contributing another 2.3% to sales growth, said Pirelli 9 May.

Affected by ‘hyperinflation’ in Turkey and Argentina and the weakness of the dollar and renminbi against the euro, foreign exchange effect more than offset the gains with a 4.8% negative impact.

Price/mix, according to Pirelli, improved on ‘progressive migration’ from standard tires to high-value larger tires and the improvement of the channel mix.

Elsewhere, Pirelli linked the growth in adjusted EBIT to the combined €43 million positive contribution of price/mix and volumes.

A €32 million positive effect of efficiency programmes helped offset the €29 million effect of “inflation of input factors”.

Furthermore, lower cost of raw materials contributed €29.4 million to earnings, which was offset by the €38.6 million negative effect of currency exchange.