CLERMONT-FERRAND, France — Michelin Group is sticking with its previously issued financial guidance for fiscal 2022 after reporting a 19% jump in revenue in the quarter ended March 31.
Barring any increase in systemic impacts, Michelin said it expects full-year segment operating income to exceed $3.5 billion, up roughly 10% over fiscal 2021, on mostly single-digit sales growth in each of its operating segments despite a "highly uncertain environment."
Michelin's first-quarter revenue increase to $7 billion was achieved as existing operational disruptions and inflationary pressures were exacerbated by the war in Ukraine and the resurgence of COVID-19 in China.
Michelin attributed the revenue growth to a sharp 11.9% gain in tire prices and a 3.4% positive currency effect. The company did not disclose earnings for the period.
By business unit, the company's gains were:
- Automotive (passenger/light truck) — up 20.8% to $3.54 billion;
- Road transportation (medium truck) — up 20.6% to $1.82 billion;
- Specialty businesses (OTR, aircraft, etc.) — up 13.7% to $1.69 billion.
In the automotive unit, Michelin noted that globally replacement market sales were up 4% over the 2021 period, based on "dynamic" growth in January-February followed by a "general contraction" in March.
OE demand was down 6% during the period, dragged down by repercussions of the Russian-Ukraine war and overall automotive component shortages.
Replacement demand in North and Central America climbed 5% over the period, with demand softening by 2% in the U.S. but remaining strong in Canada and Mexico.
Global replacement and OE market demand for truck tires declined by 5% and 28%, respectively, dragged down by major slumps in China, Michelin said.
Aftermarket demand in North and Central America rose 2%, based on 3% growth in the U.S./Canada and an 8% decline in Mexico.
Looking at the fiscal year, Michelin said it anticipates growth to be at the low end of the initially indicated ranges: 0% to 4% in passenger car and light truck tires, 3% to 7% in truck tires (excluding China) and 6% to 10% in the specialty businesses.