Goodyear Swings to Profit; Sales Climb 10%

Quarterly earnings are well ahead of estimates.
By TSC Staff ,

Goodyear

(GT) - Get Report

said it had record first-quarter sales and its best profit for the period in years as improved pricing and a better mix of products offset lower volumes.

The Akron, Ohio, tiremaker said sales for the quarter rose 10% from a year ago to $4.94 billion. Goodyear earned $147 million, or 60 cents a share, reversing the loss of $174 million, or 96 cents a share, in the same quarter a year earlier.

"Our excellent first-quarter results demonstrate the success of our strategies to grow our higher-margin premium product lines, reduce costs and pay down debt," said Robert J. Keegan, chairman and CEO of Goodyear. "Each of our four businesses improved margins and operating income as we capitalized on attractive growth opportunities in targeted market segments."

Goodyear said that although the health of the economy remains a concern, "we continue to be confident about the opportunities we see in the market and our ability to take advantage of them."

Favorable currency translation boosted sales by $341 million in the latest quarter. Profits included financing fees related to debt repayment of 18 cents a share, rationalization charges of 5 cents a share, a gain on asset sales of 13 cents and a gain on an excise tax settlement in Latin America of 3 cents.

Excluding those items, Goodyear would have earned around 67 cents, well ahead of the 47-cent consensus. Sales also topped Wall Street's estimate of $4.78 billion.

Shares of Goodyear were climbing 5.3% to $28.70 in premarket trading Friday. Fellow tiremarker

Cooper Tire

(CTB) - Get Report

wasn't trading.

Bridgestone

(BRDCY)

and

Michelin

(MGDDF)

, which have ADRs in the U.S., were also sitting out the early action.

This article was written by a staff member of TheStreet.com.

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