TRELLEBORG, Sweden — Trelleborg A.B.'s Wheel Systems business unit reported a double-digit earnings improvement in the quarter ended March 31 despite 3.1% lower sales.
Trelleborg attributed the unit's 20.9% jump in operating earnings, to $42.8 million, to higher sales volumes and structural measures. Currency value swings were cited for the sales decline, to $285.7 million.
Trelleborg President and CEO Peter Nilsson said the business witnessed a "distinct and sharp" increase in demand for tires for agricultural machinery in most geographical markets, "which could not be fully satisfied through existing inventories and increased production."
Sales growth also was dampened to some extent by high absenteeism among staff and challenging conditions for freight in certain units because of the pandemic.
Sales of tires for materials-handling and off-highway vehicles "gradually improved" during the period, but remained lower than in the corresponding period in 2020. Order intake in this market segment, however, points toward increasing deliveries going forward, Mr. Nilsson added.
North America accounted for 18% of the unit's sales, or $51.4 million, during the quarter.
Overall, Trelleborg reported 27.4% higher operating income in the period of $172.7 million on 3.1% lower sales of $979.6 million, thus raising the operating margin nearly three points to 16.8%.