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Nokian Tires offered a weaker profit - expenses from US investments

2020-02-04T12:34:09.643Z

Tire manufacturer Nokian Tires reported a clear decline in the fourth quarter, but slightly outperformed the market. Net sales grew slightly.



The company will pay a dividend of EUR 1.58 per share. This is the same as last year and also met analyst expectations.

Profit before taxes for October-December reached EUR 95.1 million, compared with EUR 113.5 million a year earlier. Earnings per share fell from EUR 0.70 to EUR 0.58.

Analysts had forecasted a pre-tax profit of EUR 96 million and a earnings per share (median) of EUR 96 million in a forecast collected by forecasting service Infront Data.

Net sales for the second quarter totaled EUR 475.8 million, compared with EUR 473.6 million a year earlier. Growth was half a percent. In local currencies, net sales decreased by 0.4 percent.

This resulted in an operating loss of EUR 101.0 million instead of EUR 117.2 million in the previous year. Operating profit declined in passenger car tires, whereas in heavy tires it improved slightly. Similarly, Vianor's operating result improved.

At the end of January, Nokian Tires confirmed its guidance for the previous year and published prospects for the current year. In the current year, Nokian Tires estimates that net sales in local currencies will decline and operating profit will be significantly lower than last year.

The company is looking for further growth in Russia, Central Europe and North America. However, net sales and operating profit in Russia are expected to decline significantly this year due to changing market dynamics.

This year's operating profit includes expenses related to North America's growth strategy and other investment programs, as announced by the company in 2018.

Source: isfi

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