MILAN, Italy — Prometeon Tyre Group S.r.l (PTG), the former Pirelli commercial tire business, reported a slight drop in pre-tax operating income in fiscal 2020 on 15.2% lower sales.
Operating income (EBITDA) fell to $140.8 million on sales of $1.04 billion. As a result, the operating margin rose nearly a point and a half to 13.6%, the company said.
Net earnings fell 65.4% to $3.07 million.
Prometeon attributed much of the sales decline to an exchange rate effect in Latin America.
Prometeon Tyre CEO Giorgio Bruno noted the 2020 performance marks the completion of a turnaround process launched three years ago. During that time, the firm implemented several strategic initiatives that have made Prometeon "healthier, stronger and more resilient in an unprecedented scenario."
Implementing "strategic interventions" at every stage of the company's value chain and placing a strong focus on sustainability and human resources allowed Prometeon to "promptly and effectively" tackle the pandemic, Mr. Bruno said, thus further improving margins, protecting cash and strengthening the debt structure.
Gregorio Borgo, chief operating officer, called 2020 a "remarkable year, both because of the context in which the company operated and because of the exceptional response from all our people, who work in a radically new way inspired by the most modern management concepts."
The company, which goes to market using the Pirelli, Anteo, NextRoad and R89 brands, did not provide an outlook for 2021.
Sales of over $1 billion puts Prometeon — which was spun out of Pirelli & C. S.p.A. in April 2017 and controls the Pirelli brand in terms of truck, bus, farm and OTR tires — among the 30 largest tire makers worldwide.
Mr. Bruno was nominated recently by Pirelli & C. S.p.A. to be its deputy CEO, filling a position being vacated by board member Angelos Papadimitriou. Prometeon has not announced a replacement.
In December 2020, Prometeon's principal shareholder, China National Tire & Rubber Co (CNRC), "entrusted" its 52% ownership stake in Prometeon to Aeolus Tyre Co. Ltd. in an effort to "further solve the problem of horizontal competition between Aeolus and Prometeon."
The agreement, which will last three years and will be automatically extended, will allow the two companies to build synergies in technological innovation and production capacity, Prometeon said, in order to supply customers with increasingly high-performing products and valuable services as well as optimize procurement processes through closer working relationships with business partners.