TRELLEBORG, SwedenTrell-eborg Wheel Systems reported slightly higher operating income for fiscal 2014 on 0.5-percent lower revenue, and management sees a challenging market climate persisting throughout much of 2015.
Trelleborg Wheel's operating income rose 2.9 percent last year to $73.5 million on sales revenue of $607.4 million.
Trelleborg attributed the earnings improvement to effective cost controls, price discipline, successful market positioning and the positive effects of exchange rate differences.
The company experienced a gradual deterioration in demand for agricultural tires due to sharp falls in agricultural machinery makers' volumes. This activity represents about a quarter of the business sector's annual sales.
In contrast, the organic sales trend for materials-handling tires was slightly positive.
A key strategic move this year will be the start of production of farm tires in Spartanburg, S.C., where Trell-eborg is spending $50 million to convert an existing factory to farm tire capacity. Production is expected to start in the second half of 2015.
Business in North America represented 24 percent of Trelleborg Wheel's sales last year, or roughly $146 million, according to the annual report.
Overall, Trelleborg A.B. reported 15-percent higher operating income of $437.5 million on sales of $3.82 billion.
Trelleborg Wheel Systems represented 18.5 percent of Trelleborg A.B.'s sales last year, down from 19.5 percent in 2013 owing to growth in other Trelleborg business sectors last year.