Goodyear reports first quarter 2021 results

Goodyear reports first quarter 2021 results

01.05.2021: – First quarter Goodyear net income of $12 million; adjusted net income of $102 million – First quarter segment operating income of $226 million, strongest first quarter since 2018 – Global consumer replacement volume

– First quarter Goodyear net income of $12 million; adjusted net income of $102 million


– First quarter segment operating income of $226 million, strongest first quarter since 2018


– Global consumer replacement volume significantly exceeded industry, driven by large-rim diameter segment


- Record first quarter consumer replacement volume in Asia Pacific


– Americas, EMEA consumer OE volumes outpaced market


– First quarter revenue per tire up 3%, excluding foreign currency

 

The Goodyear Tire & Rubber Company today reported results for the first quarter of 2021.



“We delivered impressive segment operating income, which was significantly above first quarter 2020 results and also nearly 20 percent higher than first quarter 2019 despite sales volumes not yet having fully recovered to pre-COVID levels,” said Richard J. Kramer, chairman, chief executive officer and president.  “We achieved these results despite the impact of a severe winter storm in the U.S. and industry supply chain challenges during the quarter.



“Our consumer replacement business delivered outstanding results. By leveraging improved distribution and new products, we outperformed the industry while expanding margins. At the same time, we also continued to build our OE business, where we are benefiting from our leading technical capabilities and emerging mobility trends,” continued Kramer.



“I’d like to acknowledge and thank all of our associates for continuing to manage through personal and professional challenges to deliver for our customers and communities,” added Kramer.



Goodyear’s first quarter 2021 sales were $3.5 billion, up 15% from a year ago. The increase was driven by higher volume, improvements in price/mix and favorable foreign currency translation.



Tire unit volumes totaled 35.0 million, up 12% from the prior year’s period. The impact of the COVID-19 pandemic on industry demand moderated relative to the prior year. Replacement tire volume increased 14%, reflecting both continuing industry recovery and market share gains. Original equipment unit volume increased 5%, driven by higher vehicle production in Asia Pacific and increased market share in EMEA.



Goodyear’s first quarter 2021 net income was $12 million (5 cents per share) compared to a net loss of $619 million ($2.65 per share) a year ago.


The 2021 period included several significant items, including, on a pre-tax basis, rationalization charges of $50 million primarily associated with a plan to reduce selling, administrative and general expense in EMEA and the modernization of two manufacturing facilities in Germany, and a negative impact of $23 million related to a severe winter storm in the U.S. Goodyear’s first quarter 2020 net loss included a charge of $295 million related to a valuation allowance on certain deferred tax assets for foreign tax credits and, on a pre-tax basis, a non-cash impairment charge of $182 million to reduce the carrying value of goodwill in its EMEA business unit.



First quarter 2021 adjusted net income was $102 million (43 cents per share) compared to an adjusted net loss of $140 million (60 cents per share) in 2020. Per share amounts are diluted.



The company reported segment operating income of $226 million in the first quarter of 2021, up $273 million from a year ago. The increase primarily reflects the impacts of higher volume, including increased factory utilization, improvements in price/mix, the benefits of cost saving actions, including ongoing rationalization plans, and lower raw material costs.





Reconciliation of Non-GAAP Financial Measures


See the note at the end of this release for further explanation and reconciliation tables for Segment Operating Income (Loss) and Margin; Adjusted Net Income (Loss); and Adjusted Diluted Earnings (Loss) per Share, reflecting the impact of certain significant items on the 2021 and 2020 periods.





Business Segment Results



Americas


      First Quarter
(in millions)     2021     2020
Tire Units     15.5     14.5
Net Sales     $1,787     $1,673
Segment Operating Income     114     --
Segment Operating Margin     6.4%     --

 

Americas’ first quarter 2021 sales of $1.8 billion were 7% higher than in 2020, driven by higher volume and improvements in price/mix. These factors were partially offset by unfavorable foreign currency translation. Tire unit volume increased 7%.


Replacement tire volume increased 11%, reflecting stronger industry demand and U.S. consumer and commercial replacement market share gains. Original equipment unit volume decreased 6%, reflecting lower industry demand, partially offset by consumer share gains in Latin America.


First quarter 2021 segment operating income was $114 million compared to breakeven in the prior year’s quarter. The increase was driven by improvements in price/mix, the impacts of higher volume, including increased factory utilization, and the benefits of cost saving actions, including ongoing rationalization plans.



These factors were partially offset by higher raw material costs.  We estimate a severe winter storm in the U.S. negatively impacted segment operating income by approximately $17 million.




Europe, Middle East and Africa


      First Quarter
(in millions)     2021     2020
Tire Units     12.7     11.6
Net Sales     $1,231     $995
Segment Operating Income (Loss)      74     (53)
Segment Operating Margin     6.0%     (5.3)%

 



Europe, Middle East and Africa’s first quarter 2021 sales increased 24% from last year to $1.2 billion due to higher volume, improvements in price/mix and favorable foreign currency translation. Tire unit volume increased 10%.


Replacement tire volume rose 11%, reflecting stronger industry demand and consumer and commercial replacement market share gains. Original equipment unit volume increased 6%, reflecting significant share gains driven by new consumer fitments and the addition of new fleet customers.



First quarter 2021 segment operating income of $74 million was up $127 million from the prior year’s quarter, driven by the impacts of higher volume, including increased factory utilization, improvements in price/mix and lower raw material costs.




Asia Pacific



      First Quarter
(in millions)     2021     2020
Tire Units     6.8     5.2
Net Sales     $493     $388
Segment Operating Income      38     6
Segment Operating Margin     7.7%     1.5%

 



Asia Pacific’s first quarter 2021 sales increased 27% to $493 million, driven by higher volume and favorable foreign currency translation. Tire unit volume increased 29%. Replacement tire volume increased 31%, reflecting a record first quarter performance. Original equipment unit volume increased 26%, driven by a recovery in vehicle production in China.



First quarter 2021 segment operating income of $38 million was up $32 million from the prior year’s quarter. The increase was driven by the impacts of higher volume, including improved factory utilization.




- Goodyear also photo

Permanent-URL: http://www.automobilsport.com/goodyear-first-quarter-2021-results---222610.html

01.05.2021 / MaP

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