“Michelin & Cie. (ML), Europe’s largest tiremaker, said first-quarter revenue fell 8.1 percent as a recession reducing car sales in its home region widened to hurt demand at bulldozer and military-plane manufacturers.
Sales dropped to 4.88 billion euros ($6.36 billion) from 5.3 billion euros a year earlier, Clermont-Ferrand, France-based Michelin said yesterday in a statement. Revenue missed the 4.97 billion-euro average of four analyst estimates compiled by Bloomberg. The tiremaker, reiterating forecasts of “steady” volume and “stable” earnings for 2013, said it may look at reorganizing in the absence of a market recovery.
Demand for earthmovers is “falling sharply” in Europe and North America, and sales of farm tractors and defense aircraft are also declining, Michelin said. The manufacturer is seeking more growth outside Europe and marketing more so-called specialty tires used on large vehicles amid a car-market contraction that French auto producer PSA Peugeot Citroen (UG)expects at as much as 5 percent this year.
“If volumes stay at the levels at which they are today, that would imply some European restructuring,” Chief Financial Officer Marc Henry said on a conference call with analysts. “This is under scrutiny of course, but nothing is said yet.”
The shares dropped as much as 2.77 euros, or 4.6 percent, to 57.23 euros and were down 2.3 percent as of 9:22 a.m. in Paris trading. The French manufacturer has declined 18 percent this year, valuing the company at 10.8 billion euros.
