MILAN, Italy — Pirelli & C. S.p.A. has delivered "above-target" results for fiscal 2021, despite raw-materials and logistics challenges in the fourth quarter.
Adjusted pre-tax operating earnings (EBITDA) rose 35.6% to $1.42 billion, helped by the improvement of price/mix and efficiencies, which Pirelli said "more than offset" the impact of raw-materials costs as well as currency and inflation headwinds.
Sales revenue came in at $6.3 billion, up 24% over 2020, and above previously announced targets, Pirelli reported.
Tire volumes grew 15.7%, supported by the higher value, larger-rim-sized segment, which was up 20.2%, exceeding the target of 17% to 18% growth. The price/mix component also improved 9.1% year-on-year, helping Pirelli achieve higher sales.
For fiscal 2022, Pirelli expects growth to continue, even in a "volatile context" due to inflationary and geopolitical tensions. Efficiencies and the price/mix component will more than offset the impact of the potential headwinds, such as raw materials, inflation and currency exchange issues.
Revenue growth is estimated at 6% to 7.5% based on volume growth of 1.5% to 2.5%.
In the fourth quarter, revenues came in at $1.54 billion, up 11.9%. Pirelli linked the growth to the 16.3% positive performance of the price/mix, despite a global fall in demand.
Volumes during the final quarter fell 7.3%, reflecting a 5% decline in original equipment demand, due to the shortage of semi-conductors.
The replacement channel witnessed a 13% improvement year-over-year.
Pirelli said its competitiveness program, which it launched in 2020, was "fully on track" in 2021, as the company continued to cut costs by over $180 million and "more than offset" the inflation of production costs.
During the year, the level of capacity utilization returned to 90%, as the tire maker concluded the restructuring of its manufacturing footprint in Brazil, Italy and the United Kingdom.
As a result, Pirelli's Bollate, Italy, factory has converted production to cycling tires from standard car tires, and in Brazil, motorcycle tire production was transferred to a plant in Campinas from Gravataì in a move the company said enables both the more efficient supply of the Latin American market and the export channel.
The company also reorganized its factory in Burton-on-Trent, England, to focus on semi-finished goods.
Pirelli now has 15 tire plants, down from 17 in 2019.
