Finnish tyre maker Nokian Renkaat said it expected to increase both sales and profits in 2014 as demand in Russia, its key market, recovers sligthly from a slump in 2013.
The leader in the Russian and Nordic winter tyre markets said its fourth-quarter operating profit, excluding one-off items, fell 9 percent from a year earlier to 102 million euros ($139 million), roughly in line with market expectations.
A slowdown in Russia’s econonomy hit car and tyre demand last year in the country, where the company has its main factory.
Nokian said it had a “slow start” for 2014 but still expected to see growth in the full year. It also said a fall in raw material costs would help support its margins.
Nordea analyst Rauli Juva said the outlook was comforting, considering the market’s concerns about Russia. The company’s shares rose 2.5 percent in early Hesinki trade.
“The mild winter has been another worry, but the company says inventory levels in Europe are lower than a year ago. All in all, it looks pretty positive,” he said.
The Finnish tax office’s demand for an additional tax payment of 100 million euros, which Nokian is appealing, also hit its bottom line. However, proposed to keep its annual dividend unchanged from a year ago at 1.45 euros per share.
Source: Wards Auto
Published: 06 Feb 2014