Lifted by higher prices and global demand, Goodyear Tire & Rubber (NYSE:GT) reported on Thursday a 43% improvement in second-quarter profit and record revenue as tire sales across all its geographic regions improved.
The Akron, Ohio-based maker and seller of tires posted net income of $40 million, or 16 cents a share, compared with $28 million, or 11 cents a share, in the same quarter last year, below average analyst estimates polled by Thomson Reuters of 27 cents.
For the three weeks ended June 30, Goodyear booked record sales of $5.6 billion up from $4.53 billion a year ago, beating the Streets view of $5.18 billion. Sales improved on stronger prices and 18% growth in North American tire sales to $2.4 billion, 21% gain in Latin America, 27% improvement in Asia Pacific and 34% increase in Europe, Middle East and Africa.
I'm very pleased with our outstanding second quarter results, which represent another step on the path toward our 2013 targets, said Goodyear CEO Richard Kramer. They present confirmation that our strategies are right and that they are working.
Partially offsetting the gains was a 2% decline in tier unit volumes to 42.9 million, a reflection of weaker industry volumes, particularly in North America.
Goodyear said it expects the global tire industry to continue growing in 2011, though it anticipates unit volumes for the year will increase at the lower end of its forecasted range of 3% to 5% due to softer volume levels and a reduced outlook for the U.S. consumer replacement industry.
While sluggish economic recovery in developed markets and higher inflation in emerging markets have resulted in uneven growth in the tire industry, Kramer said the company is confident Goodyear is well position to address the volatile demand.