Cooper Tire & Rubber Co. reported an all-time quarterly tire sales record in the third quarter-despite lower unit volume-on its way to a 6.2-percent increase in net sales for the period.
Cooper's net sales from continuing operations grew to $551.4 million from $519.2 million last year. Net income fell to $9.87 million from $17.8 million last year. Sales in Cooper's North American Tire operations rose 4.4 percent to $499 million from $478 million last year. Operating profit in the tire division slipped to $27 million from $31 million last year because of lower unit volumes, higher raw material costs and production complexity. Improved price and mix partially offset these factors.
Cooper has designated its Cooper-Standard Automotive Group as discontinued operations based on the agreement to sell that unit. The firm also designated its Clarksdale, Miss., tube operations as discontinued following its decision to cease production there and exit the inner tube business.
The Findlay-based tire maker said the increase in the tire unit's operations was driven by improving mix and price but was partially offset by lower overall volumes. Cooper said industry demand for replacement tires remained soft, and the company's shipments also were down from last year's third quarter. The most notable declines were in the economy and broadline passenger tire categories. Cooper said it gained market share in the winter, high-performance and light-truck tire segments.
Expansion projects will continue in all four North American Tire plants to relieve ``constrained capacity,'' the company said. Projects are largely complete at Tupelo, Miss., and in Findlay, while capacity expansions will continue through year-end at Texarkana, Ark., and through year-end 2005 at Albany, N.Y.
Cooper's International Tire operations' sales grew 20.5 percent to $66 million from $55 million the previous year.
For the first nine months of the year, Cooper reported net sales of $1.54 billion, up 15.3 percent from $1.34 billion a year ago. Net income grew to $68.1 million from $45.7 million last year.
``We are optimistic about our opportunities in the fourth quarter and into 2005,'' Tom Dattilo, president, CEO and chairman, said in a statement. ``Raw materials are still headed higher and will make industry conditions challenging, but we can offset some of this impact as we begin to benefit from our capacity expansions in North America and also from increasing sourcing from China.''