Cooper Tire & Rubber Company (NYSE: CTB)
today reported results for the second quarter of 2013. Net sales were $884 million, a decrease of $174 million compared with the same period a year ago. Operating profit for the second quarter was $69 million, which is $26 million lower than the same period in 2012 and 7.8% of net sales. The company reported net income attributable to Cooper Tire & Rubber Company of $35 million, or $0.55 per share, in the second quarter. This compares with $52 million, or $0.82 per share, for the same period last year. For the first six months of 2013, operating profit was $166 million compared with $143 million for the same period in 2012.
On June 12, 2013, the company announced it had reached a definitive merger agreement under which a wholly-owned subsidiary of Apollo Tyres, Ltd. will acquire Cooper in an all-cash transaction valued at approximately $2.5 billion. The transaction, which will bring together two companies with highly complementary brands, geographic presence, and technological expertise, is expected to close before the end of this year.
Cooper’s second quarter operating profit comparison was impacted by several one-time items unique to the period in both 2012 and 2013. In the second quarter of 2012, operating profit included a pre-tax gain of $7 million related to the curtailment of a pension plan within the company’s United Kingdom operations, which was partially offset by $2 million in start-up costs for the company’s new manufacturing operation in Serbia. In the second quarter of 2013, results included $7 million in higher costs related to the pending merger with Apollo Tyres, Ltd. The $7 million included increased accruals for stock-based liabilities of $3 million, reflecting the stock price appreciation following the acquisition announcement, and transaction related expenses of $4 million. These non-recurring items account for $12 million of the year-over-year decline in second quarter operating profit.