The board of directors of Pirelli & C. SpA reviewed and approved intermediate results for the three months ended March 31.

The first quarter of 2013 was characterized by an economic scenario still strongly influenced by the crisis affecting Europe, where the demand for goods and services continues to shrink. In total, the European market has undergone a decline compared with 2012, which is more marked in the consumer segment where the replacement channel fell by 11 percent. In this channel, the premium segment was also impacted and saw a decline, although not as steep as the overall figure.

The performance of South American markets in both segments was positive, as was China in the consumer segment. In these areas, the premium segment continued to grow, positive also in the NAFTA area. The group results were as a consequence affected by overall macro-economic performance, with a decline of sales and results in Europe, partially offset by growth in other geographic areas. Consolidated revenues on March 31 stood at EUR 1,536.3 million, a decrease of 1.3 percent compared with EUR 1,556.5 million in the first quarter of 2012. The figure includes a negative impact of -4.9 percent linked to exchange rates, essentially because of the devaluation of South American, Japanese, U.K. and Egyptian currencies.

Net of the exchange rate effect, overall revenues grew by 3.6 percent. The gross operating margin (EBITDA) before restructuring costs was EUR 255.3 million, a decrease of 8.5 percent compared with EUR 279.1 million in the same period of 2012. The operating result (EBIT) was EUR 179.8 million, with profitability at 11.7 percent, a decline compared with EUR 212.7 million in the first quarter of 2012 (13.7 percent of sales). The decline was negatively affected by, among other things, an exchange rate impact of about EUR 10 million, greater industrial costs (about EUR 10 million) mainly due to the acceleration of the process of focusing the Settimo Torinese hub on premium production and the start-up in Mexico, greater amortization of EUR 10.8 million stemming from investment activity in prior years, as well as restructuring costs of EUR 3.2 million (EUR 2 million in the first quarter of 2012).

Source: rubberworld.com