Nokian forecasts strong profits

Dhaka,  Thu,  24 August 2017
Published : 08 Aug 2017, 15:19:28

Nokian forecasts strong profits

Nokian forecasts strong profits
Finnish tyre maker Nokian Tyres raised its profit forecast on Tuesday after beating second quarter forecasts on higher Russian demand and a stronger rouble.

Operating profit rose 21.5 per cent to 94 million euros ($111 million), topping a market consensus of 85 million euros, reports Reuters.

Shares in the company, which has a large tyre plant in Russia and a smaller one in Finland, jumped by 8.0 per cent after its results.

"We were able to increase our market shares in our main markets. The growth was driven by Russia due to its stronger currency, price increases and low carry-over stocks from 2016," Chief Executive Hille Korhonen said in a statement.

The company reiterated that its costs this year would rise by about 20 per cent for raw materials such as rubber but said cost pressures were now easing with the benefit of tyre price increases already implemented expected to emerge in the second half.

The company said it now expects sales and profit to grow by at least 10 per cent in 2017, compared with a previous guidance of at least 10 per cent sales growth and more than 5.0 per cent profit growth.

Nokian said it would start a new production line at the Russian plant by the end of the year.

It is also looking to boost growth outside Russia and Europe with a plan to build a $360 million plant in the United States.
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