AKRON — Goodyear suffered a net loss of $57 million (20 cents per share) in the first quarter of 2024, but the loss represents a marked improvement versus the net loss of $101 million (35 cents per share) in the first quarter of 2023.
The company attributed the year-over-year improvement to an increase in segment operating income, which nearly doubled to $247 million, or 5.4% of sales revenue, which was down 8.2% to $4.54 billion.
Segment operating income in the Americas more than doubled (up 126.6%) to $179 million from the year-ago quarter. Adjusted net income for the quarter was $29 million.
Goodyear said the first-quarter report includes several significant items, such as the Goodyear Forward plan, with costs of $28 million and rationalization charges of $22 million, compared with pre-tax rationalization charges of $32 million in 2023.
Goodyear Forward costs include advisory, legal and consulting fees and costs associated with planned asset sales.
First quarter 2024 sales were $4.54 billion, Goodyear said, with tire unit volumes at 40.4 million. First-quarter adjusted net income was $29 million compared with an adjusted net loss of $82 million in the year-ago quarter.
Goodyear attributed the increase in segment operating income of $127 million to an improved price/mix versus raw materials and $72 million from the Goodyear Forward plan.
The impact of net inflationary costs of $33 million and lower tire volume of $28 million partially offset those numbers. Revenue in the Americas fell 9.7% to $2.59 billion, dragged down by lower replacement volumes and unfavorable price/mix due to continuing industry weakness in commercial truck and contractual price adjustments.
Tire unit volume decreased 7.4% to 19 million, Goodyear said, with replacement unit volume falling 9.2% given declines by U.S. Tire Manufacturers Association industry members. By contrast, Goodyear said shipments by industry non-members, many offering low-cost imports, grew significantly in the quarter. Original equipment unit volumes were flat.
The increase in Americas' segment operating income was driven by lower transportation costs, benefits from the Goodyear Forward plan and favorable net price/mix versus raw material costs. These benefits were partly offset by inflationary costs and lower volume.
In the Europe/Middle East/Africa segment, first-quarter sales were $1.35 billion, down 9.7%, driven by lower replacement volumes and unfavorable price/mix due to a weak commercial truck industry and contractual price adjustments.
Tire unit volume decreased 5.2%. Replacement tire unit volume decreased 7.1%. OE unit volumes were flat.
Asia Pacific's quarterly sales increased 3.4% to $602 million, buoyed by higher OE volume. Tire unit volume increased 10%. OE unit volume increased 26.7%, driven by EV fitments in China. Replacement tire unit volume decreased 1.6%, reflecting industry declines.
Goodyear will hold an investors' conference call at 8 a.m. May 7, where Goodyear CEO and President Mark Stewart and Christina Zamarro, executive vice president and chief financial officer, will offer insights on the tire maker's performance as well as its progress on the Goodyear Forward transformation plan.
The company said Stewart, the former chief operating officer of auto maker Stellantis N.V., also will reflect on his first 90 days on the job, since replacing the retired Richard Kramer.
