The results for the first quarter of 2014 show growth in the main economic indicators, which reflects the recovery of demand in Europe, which could already be seen in the last quarter of 2013, and the ever growing positive contribution to results of the Premium segment on which Pirelli is focused. This growth was achieved notwithstanding the impact of exchange rates, linked to the ever stronger euro and the volatility of other currencies.

Consolidated revenues in the quarter saw organic growth of 8% to 1,473.2 million euro, particularly due to the progressive improvement of the price/mix component, which grew during the period by 4.6% (in line with the target of +4%/+5% foreseen for full year 2014). Including the negative 10.7% impact of exchange rates, revenue performance was negative 2.7%.

The recovery of the European market, where revenues registered growth of 10.2%, had positive effects in particular in the Consumer business, while the Industrial business suffered the impact of exchange rates which was heavily concentrated in emerging markets. Thanks to the favourable performance of the Premium segment, the positive contribution from the price/mix component and the ongoing efficiency programme, both segments saw significant improvement in profitability, with the Ebit margin in the Consumer segment up to 14.1% from 12.2% and in the industrial segment to 13.5% from 12.4%. Overall, Ebit after restructuring charges grew by 12.6% to 201.0 million euro, with an Ebit margin which improved to 13.6% from the previous 11.8%. Before restructuring charges, profitability stood at 14%, with an increase of two percentage points compared with the corresponding period of 2013.

Efficiencies, in particular, reached 27.6 million euro in the quarter (31% of the full year target of 90 million euro), the first results of the 4-year (2014-2017) efficiency plan of 350 million euro announced in November 2013; achieved through the “de-complexity” plan and in particular through the rationalization of raw material use.

In the Premium segment revenues totaled 639.9 million euro, an organic increase of 16.4% (+12.9% including exchange rate impact, negative 3.5%) compared with the previous year and representing 56.7% of Consumer sales (50.8% in the first quarter of 2013). This business sector saw sustained growth both in emerging countries (+14.7%) and mature markets (+12.4%) also thanks to the recovery in the Europe area.

Total volumes increased by 3.8%, with Consumer volumes rising by 5.9% and Industrial volumes decreasing by 2.2%. The latter figure also reflects the high level of growth in emerging markets in the corresponding period of the prior year (+15.3%) and the progressive reduction of the conventional business in South America.

It is worth noting the positive performance in Russia, where revenues - excluding exchange rate effects – increased by 5.4% and profitability stood at high single digit levels.