Groupe Michelin reported its earnings targets for 2015 and predicted that volume will rise this year and first-half spending on supplies such as rubber will decline.
Operating profit excluding one-time items dropped 7.8% for 2013 to 2.23 billion euros, Michelin said. Sales fell 5.7% year-over-year to 20.2 billion euros. The company plans to raise the dividend 4.1% to 2.50 euros a share.
Michelin said it plans to sell 3% more tires in 2014, in line with the global industry.
Chief Executive Officer Jean-Dominique Senard said that the manufacturer will probably achieve its $1.37 billion cost-savings goal for 2016.
The tiremaker plans to add factories in emerging markets where demand for cars is forecast to rise, such as Brazil, China and India. In addition to these emerging markets, Senard mentioned the U.S. At the same time, Groupe Michelin will reduce costs in Europe, including cutting jobs in France, as the region’s automotive sales linger at a two-decade low. Michelin plans to raise operating profit to 2.9 billion euros by next year.
“This gives us greater flexibility,” and the company is open to acquisitions, “probably in Asia,” said Senard, noting that the company cut net debt 87% last year.
