PARIS — Weighed down by an unfavorable currency exchange swing in the past several months, Group Michelin reported a 6.3-percent drop in sales revenue for the three months ended March 31.
The drop was compounded by a 2.3-percent drop in unit volumes, which Michelin attributed to "massive" dealer inventory build-ups ahead of price increases announced in the fourth quarter of fiscal 2017. Mining tire sales maintained their momentum from 2017.
Despite the first quarter decline, to $6.41 billion, Michelin is sticking by its earlier forecasts of volume growth in line with global market trends and operating income from recurring activities exceeding the 2017 figure, at constant exchange rates.
Michelin did not disclose earnings at this time.
Over the full year, Michelin said it expects demand to increase slightly in the passenger car and light truck tire markets and remain stable in the truck tire markets. The mining tire market should continue to enjoy "robust" growth.
Michelin said it expects the currency effect will remain "highly unfavorable" throughout the year, generating a negative impact on operating income of nearly $430 million.