Select Page

Cooper Tire net income plunges in Q4 & 2013

Lower sales, labour disputes at its Chinese joint venture and the termination of merger-deal with Apollo have cost Cooper Tire & Rubber Company’s net income in fourth quarter and in 2013. During the fourth quarter ended December 31, 2013, the company’s net profit plunged 73% to $20 million compared with $73 million for the same period of last year
Net sales dropped by 19 % $ 861 million in the fourth quarter from $ 1.10 billion in the same quarter of the previous year , while operating profit was $47 million, which is $77 million lower than the same quarter previous year .
For the year ended December 2013, the company reported net income per share $1.73 on a diluted basis for the full year. Net sales for 2013 fell by 18% to $3.4 billion against $4.2 billion in 2012. Operating profit for the full year 2013 was $241 million versus $397 million in 2012.
“Delivering operating profit of $241 million in 2013 and exiting the year with a strong balance sheet is a testament to the dedication and commitment of Cooper people worldwide and to the resilience of our business model,” said Cooper Chairman, Chief Executive Officer and President Roy Armes. “These results were achieved despite several unique challenges in 2013, the impact of which will diminish as we move forward in 2014. I am proud of our organization and confident in our strategic plan, which we believe will produce results that create value for our shareholders over the long term.”
According to the company, the fourth quarter profits compared with the prior year included $27 million in unusual items related to the negative impacts of labor actions taken at the Cooper Chengshan (Shandong) Tire Company, Ltd. (CCT) joint venture. This figure included $25 million from lower volumes in the North America and International business segments and $2 million of manufacturing inefficiencies in the International business segment. Fourth quarter results also included $9 million of costs resulting from the now terminated merger agreement with Apollo Tyres.
The US company said that raw material prices lowered by 18% compared with the fourth quarter of 2012 and by 1% from the third quarter. Cooper predicts that the raw material cost in the first quarter of 2014 will be around 3% lower than the fourth quarter of 2013.
“We look forward to moving ahead in 2014,” Armes said. “With the merger agreement terminated, operations at CCT returning to normal, and our ERP deployments in the U.S. nearing completion, the challenges of 2013 are largely behind us. Overall, we believe Cooper will begin to recover unit volumes this year and grow volumes at a rate equal to or higher than the industry in key markets. This will allow us to continue to effectively leverage our flexible global manufacturing and distribution footprint to deliver on our strategic plan objectives, which focus on driving stockholder value as a top priority.”

About The Author

Leave a reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest Issue

Newsletter Subscription

Recent Tweets

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!