Raw material costs drive down Goodyear’s quarterly profit.
Goodyear Tyre and Rubber has announced its Q1 2017 net earnings fell to $166 million, or $0.65 a share, from $184 million, or $0.68 a share, during the same period a year ago.
Excluding non-recurring items, adjusted earnings per share were $0.74 a share, beating analyst estimates of $0.63. The Akron, Ohio-based tyre maker’s revenue grew slightly to $3.70 billion up from $3.69 billion. Analysts had expected revenue to reach $3.78 billion, according to financial sources. The company’s sales were flat in the Americas, declined slightly in the Europe, Middle East and Africa region and inched up in Asia Pacific.
Goodyear CEO Richard Kramer, said: “While raw material inflation has moderated in recent weeks, we continue to expect a significant year-over-year headwind in 2017. We remain confident in our ability to offset raw material cost inflation over time.” Tyre unit volumes for Goodyear totaled 40 million, down 4% from 2016. Original equipment unit volume was down 8%, primarily driven by lower US auto production in Q1 2017 and very strong volumes in the US and China during Q1 2016. Replacement tyre shipments were down 2%.
The company reaffirmed its full-year forecast for segment operating income of $2 billion.