TRELLEBORG, Sweden— Trelleborg A.B's Trelleborg Wheel Systems S.p.A. unit — the off-road tire and wheel business being acquired by Yokohama Rubber Co. Ltd. — posted double-digit increases in sales and earnings for the quarter and half-year ended June 30 on increased demand in all product and geographic markets.
Trelleborg Wheel generated 48% higher operating income in the quarter of $51.3 million on 31.4% higher sales of $341.7 million. Trelleborg cited higher sales volumes, structural measures implemented earlier and effective cost controls for the earnings improvement.
The company pointed to "healthy increase" in demand in all tire categories in all geographic markets, with "particularly" strong demand in North and South America.
In Europe, total sales of agricultural tires grew but deliveries to the aftermarket declined, impacted by the war in Ukraine and drought in many countries. Sales of tires for materials-handling and construction vehicles displayed a "significant upturn" compared with the year-earlier period.
For the six-months ended June 30, Trelleborg reported a 47% improvement in earnings at $105 million on 29.7% higher revenue of $684 million.
Looking ahead, Trelleborg Group CEO Peter Nilsson noted "a slight downturn in order intake compared with previous quarters.
"There are clear indications of increased uncertainty ahead of the second half of the year," he added.
"We are highly confident in our ability to address the fluctuations in the market. For the third quarter, our overall assessment is that demand will be slightly lower than in the second quarter of the year," he concluded.
Overall, Trelleborg A.B. reported a 22% year-on-year increase in earnings (EBIT) excluding items affecting comparability to $128 million on 21% higher sales of $718 million during the quarter.
Trelleborg agreed in March to sell Trelleborg Wheel Systems to Yokohama Rubber for $2.3 billion in a cash and debt-free basis.
The transaction, which will in effect double the size of Yokohama Rubber's off-highway tire business, is set for completion "in the latter part of 2022," subject to regulatory approvals, the companies disclosed in separate announcements.