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Group Michelin eyeing "stable' earnings in "13

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PARIS—Group Michelin expects to report “stable” operating income and steady sales volumes this year in a global environment it describes as “uncertain” in mature markets but still expanding in new ones.

Michelin expects its operating earnings to benefit from stable raw materials pricing, at least in the first half of the year, executives said in connection with the release of the firm's fiscal 2012 results. This should benefit the bottom line by as much as $500 million vs. previous years, the firm said.

The tire maker did not issue a specific revenue forecast for 2013. Fiscal 2012 sales were $27.6 billion, a gain of 3.6 percent over 2011.

Michelin, which said it is “confident in its competitive strengths,” is banking on the launch of an “ambitious” project to improve its management systems to help it achieve its 2015 financial objectives of an operat-

ing income of $3.7 billion, positive cash flow and a return on capital employed of more than 10 percent.

Michelin is budgeting more than $2.5 billion annually the next few years to support the expansion of production capacity in the world's growth regions, improve competitiveness in mature markets and drive technological innovation. The capacity start-ups will weigh on costs.
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