– Record full-year segment operating income of $1.7 billion
– Full-year free cash flow from operations of $1.0 billion
– North America sets earnings records for fourth quarter, full year
– Completed $150 million in share repurchases in fourth quarter
– Company releases $2.2 billion U.S. tax valuation allowance, no change to cash taxes
– Company reaffirms 2015 earnings growth target of 10%-15% above 2014 results
BANGKOK, 20 February 2015 —— The Goodyear Tire & Rubber Company today reported results for the fourth quarter and full year of 2014.
“We delivered record full-year segment operating income, successfully navigating a challenging global economic environment,” said Richard J. Kramer, chairman and chief executive officer.
“While industry conditions led to mixed results globally, we achieved record fourth quarter segment operating income in North America as well as in Asia Pacific. Our continued performance validates the successful execution of our strategy,” he added.
“The release of our $2.2 billion U.S. tax valuation allowance after 12 years is a major milestone for Goodyear. It marks the completion of the successful turnaround of our North America business,” Kramer said.
The release of the tax valuation allowance represents a one-time, non-cash benefit to earnings in 2014. While the company will record charges for income taxes in future periods, it does not expect to pay cash taxes in the U.S. for approximately five years.
“Led by our momentum in North America, we are on target to achieve 2015 segment operating income growth of 10 per cent to 15 per cent above our record setting $1.7 billion in 2014, despite severe headwinds from the increasing strength of the U.S. dollar,” Kramer said.
Goodyear’s fourth quarter 2014 sales were $4.4 billion, compared to $4.8 billion a year ago. Sales were impacted by $256 million in unfavourable foreign currency translation and $181 million in lower sales volume in Europe, Middle East and Africa.
Tire unit volumes totaled 39.5 million for the fourth quarter of 2014. Original equipment unit volume was down 1 per cent, primarily due to continued industry weakness in Latin America. Replacement tyre shipments were down 4 per cent, due to lower sales of winter tyres in Europe resulting from one of the warmest winters on record.
The company reported segment operating income of $359 million in the fourth quarter of 2014, compared to $419 million a year ago. The decline in segment operating income was driven by reduced price/mix and lower volume, which more than offset the benefits of lower raw material costs and other cost savings actions.
Goodyear’s fourth quarter 2014 net income available to common shareholders was
$2.1 billion ($7.68 per share). Excluding certain significant items, adjusted net income was $166 million (59 cents per share).
For the fourth quarter of 2013, net income available to common shareholders was
$228 million (84 cents per share). Excluding certain significant items, adjusted net income was $209 million (74 cents per share). Per share amounts are diluted.
Goodyear’s 2014 sales were $18.1 billion, compared to $19.5 billion in 2013. Sales were impacted by $571 million in unfavourable foreign currency translation. Tire unit volumes totaled 162 million. Replacement tyre shipments were up 1 per cent. Original equipment unit volume was down 3 per cent.
The company’s segment operating income of $1.7 billion was up 8 per cent from last year. Compared to the prior year, the significant increase in segment operating income reflects lower raw material and conversion costs partially offset by lower price/mix and unfavourable foreign currency translation.
Goodyear’s 2014 net income available to common shareholders was $2.4 billion ($8.78 per share). Excluding certain significant items, adjusted net income was $790 million ($2.83 per share).
Net income available to common shareholders was $600 million ($2.28 per share) in 2013. Excluding certain significant items, adjusted net income was $725 million ($2.63 per share). All per share amounts are diluted.
Business Segment Results
Fourth Quarter Twelve Months
(in millions) 2014 2013 2014 2013
Tyre Units 16.0 16.3 61.1 61.7
Sales $ 2,105 $ 2,131 $ 8,085 $ 8,684
Segment Operating Income 229 199 803 691
Segment Operating Margin 10.9% 9.3% 9.9% 8.0%
North America’s fourth quarter 2014 sales decreased 1 per cent from last year to $2.1 billion. Sales reflect a 1 per cent decrease in tyre unit volume and unfavourable foreign currency translation, partially offset by improved price/mix. Replacement tyre shipments were down 1 per cent. Original equipment unit volume was flat.
Fourth quarter 2014 segment operating income of $229 million was a 15 per cent improvement over the prior year and a record for any quarter. The improvement was driven primarily by lower raw material costs and lower pension expense.
About Goodyear Thailand
Goodyear Thailand was established in 1968 and began tyre manufacturing in 1969. In 1994, Goodyear Thailand became a publically-limited company. It now provides original equipment (OE) and replacement tyres for passenger, 4X4/SUV, light truck, commercial truck and aviation customers both for domestic and export markets. Goodyear Thailand also has the only Goodyear facility in Asia Pacific and one of only three plants globally that manufactures new aviation tyres. For more information about Goodyear Thailand and its products and services, please visit www.goodyear.co.th
[Source : Goodyear Thailand]