Cooper Tire & Rubber Company (NYSE: CTB)
today reported results for the fourth quarter and full year 2012. Fourth quarter net sales were a record $1.1 billion, an increase of $24 million, or 2%, compared with the same period a year ago. Operating profit was a fourth-quarter record of $124 million, $65 million higher than fourth quarter 2011 and 11.7% of net sales. The company reported net income attributable to Cooper Tire & Rubber Company of $1.15 per share, or $73 million in the fourth quarter. This compares with $32 million, or $0.51 per share, for the same period last year, excluding the one-time, non-cash impact of $177 million, or $2.82 per share, in 2011 due to the release of most of the company's valuation allowance against U.S. deferred tax assets and related expense effects.
“A strong fourth quarter capped off a great year,” said Chief Executive Officer Roy Armes. “Cooper Tire closed 2012 with record fourth quarter and full-year net sales and operating profit. Despite challenging global economic and industry conditions, our employees around the world continued to execute our strategic initiatives including diversifying our channel and product mix for light vehicle tires as well as expanding volumes in the truck-bus radial tire segment. Due in large part to successful product launches and demand for our products, the company has increased unit volumes and outpaced the industry in our key markets for the full year. Among other achievements in our International segment during 2012, we completed the purchase of tire manufacturing assets in Serbia, a facility that has already produced its one millionth tire and was responsible for driving volume growth for the total International segment in the fourth quarter."
Fourth quarter profits compared to the prior year were positively impacted by lower raw material costs of $101 million, manufacturing efficiencies of $9 million, volume increases totaling $5 million and $2 million in lower product liability costs. These profit contributors were partially offset by $25 million in unfavorable price and mix, and $20 million in higher selling, general and administrative costs as the company continued to invest in expanding distribution networks and promoting Cooper brands. “Other” costs increased $6 million including higher pension expense. Higher incentive compensation costs, resulting from higher profits, affected both selling, general and administrative costs and “other” costs.