MILAN, Italy — Pirelli & C. S.p.A. has reported a 6.4% year-on-year rise in pre-tax second quarter earnings, to $292 million, on sales up 3.7% at $1.8 billion.
Excluding a negative currency effect, the sales increase equated to 9.1%, said Pirelli, which linked the earnings gains to "price increases and improved mix."
First half revenues came in 7.5% higher year-on-year at $3.7 billion, or 10.4% higher excluding currency factors.
Adjusted EBIT for the first six months was $561 million, an increase of 7.4% compared with the same period in 2022.
Pirelli's July 27 financial statement went on to highlight a strengthening of its position in high-value tires, including 5.7% growth in 18-inch-plus car tire volumes — outpacing the market by around 1%.
The Italian group was also buoyed by an improvement in price/mix as well as efficiencies, which more than offset negative raw materials, inflation and forex effects.
Based on its first half showing — particularly on price-mix — Pirelli upgraded its full-year forecast for adjusted EBIT margin to between around 14.5% and 15%, from around 14-14.5% previously.
Revenues, however, are projected to come in slightly lower than previously forecast, around $7 billion to $7.3 billion.
The downgrade, from the previous forecast of between around $7.2 billion and $7.4 billion, was linked to volumes and forex developments.
Volumes are estimated to decline by between around 2% and 1%, compared to Pirelli's previous indication of stable to around plus 1%.
Amid a "volatile" market outlook, Pirelli foresees "mild economic growth due to uncertainty regarding Europe, penalized by monetary tightening, and China, which is experiencing a slower than expected recovery."
Given the weaker-than-expected market performance in the second quarter, it forecast global car tire demand to dip by around 2%, compared with a previously estimated "flat" market.
On the other hand, demand for high-value tires is expected to grow by 3% year-on-year, according to the Milan-based group.
This, forecast Pirelli, will include growth of around 5% in 18-inch-plus original equipment tire volumes – below the 7% growth previously indicated due to lower demand in China.
Meanwhile, less-than-18-inch replacement tire volumes are expected to grow by around 2%, compared to a previous indication of plus 3%.
The revision reflected "a more cautious view regarding demand in Europe — seen recovering in the second half of the year following the weak trend of the first half and in China."
