FINDLAY, OhioCooper Tire & Rubber Co.'s net income of $212.8 million for 2015 was on par with the previous year, despite a 13.2-percent drop in sales to $2.97 billion.
Findlay-based Cooper reported an operating profit of $354 million, an 18-percent increase over 2014. The tire maker noted that the 2014 results included a gain of $56 million net of tax from the sale of the company's former Cooper Chengshan Tire (CCT) joint venture in China in the fourth quarter of 2014.
Excluding CCT, the Cooper's net sales increased 3.3 percent compared with 2014 and unit volume rose 6.8 percent, driven by an increase in all regions. A record operating profit represented a 59-percent increase over prior year, the company said.
It was an exciting year for Cooper as we took numerous steps around the globe to continue to transform and enhance our business, said Cooper Chairman, CEO and President Roy Armes, who announced his plans to retire in August.
Our fourth quarter and full year performance was very strong, with unit volume increases in all regions and excellent operating profit. In fact, our full year operating margin of nearly 12 percent exceeded the 8 to 10 percent that we established as a mid-term goal for Cooper, Mr. Armes continued.
We continued to execute our strategic plan and invest in operations around the globe to improve our competitive position. Specifically, we invested in modernizing and enhancing our facilities and continued to invest in technology and product innovation. We are seeing a return on these investments as Cooper moves upstream, selling more high value, high margin products. In addition, we continued to return cash to shareholders through share repurchases and our ongoing dividend.
Mr. Armes said that in 2015 the tire maker broadened its global reach and capabilities through expansion in Latin America and strategic partnerships such as our recently announced agreement to acquire a majority interest in China-based Qingdao Ge Rui Da Rubber Co. Ltd. (GRT).
For 2016, Cooper said it expects unit volume growth in each of its segments, with unit volume growth in its U.S. operations at or above the industry; further declines in raw material costs in the first quarter of 2016; and total company operating margin, excluding the impact of acquisitions, to be above the high end of the company's mid-term target of 8 to 10 percent, not likely to exceed the 2015 results.
Cooper's capital expenditures for 2016 are expected to range from $240 million to $260 million, excluding the impact of any acquisitions.
For the fourth quarter, Cooper's net earnings dropped 28 percent to $59.3 million as sales slid 5.4 percent to $776 million, compared with the year-ago period. However, its operating profit surged 91 percent to $103 million, compared with the 2014 quarter. Excluding the CCT operations, net sales increased 3 percent.
Fourth-quarter net sales in the Americas rose 3.2 percent to $711 million as a result of higher unit volume of $22 million. Segment unit shipments increased 3.2 percent compared with the same period last year. Cooper's total light vehicle tire shipments in the U.S. increased 3.6 percent during the quarter.
Fourth-quarter operating profit for the company's Americas segment surged 85.4 percent to $122 million. The higher operating profit reflected favorable raw material costs of $63 million, favorable price and mix of $10 million, and higher unit volume of $4 million, Cooper said.
These were partially offset by increased SG&A costs of $12 million, which included $8 million of higher incentive costs based on the strong financial performance of the company, as well as higher manufacturing costs of $5 million and negative currency and other costs of $4 million.