PARIS (Oct. 25, 2005)—Group Michelin's sales in the third quarter grew 4.5 percent over the 2004 period, but the firm does not expect “significant market improvements” in the fourth quarter.
As a result, the company is adjusting production levels to match conditions and is now saying operating performance will be equal to that of 2004, whereas earlier the company had forecast an improvement.
Michelin attributed the sales increase to improvements in the pricing/product mix and currency exchange rates while saying production volume was down in the quarter and for the nine months ended Sept. 30.
Under the current circumstances and barring any further deterioration of markets in the final quarter, Michelin expects its operating performance will be at least as good as last year's, when it had a pre-tax operating profits/sales ratio of 8 percent.
For the third quarter, Michelin reported sales of $4.68 billion. Sales through nine months were up 1.8 percent to $13.7 billion. Michelin did not report earnings at this time.
Michelin did not elaborate on its plans to adjust production, but did say nine-month sales of replacement truck and farm tires in Europe were down 6.6 percent and overall demand in South America was down “markedly.”