Pirelli Backs Guidance After Inflation Hurts Net Profit — Update

By David Sachs

Pirelli's net profit fell in the first quarter, hurt by inflation effects that the tire maker expects will stabilize later this year.

The Italian company said Thursday that hyperinflation in Argentina and Turkey dragged on net profit and also contributed to slightly lower revenues compared with the first quarter of last year. Unfavorable foreign-exchange rates also hit revenue, which was higher than expected, according to the company-compiled consensus.

The tire-maker's key profitability target was higher than the prior-year period, and in line with expectations. The adjusted earnings before interest and taxes margin was 15.5%, up from 14.6% and compared with a company-compiled forecast of 15.3%.

Net profit finished the quarter at 93.7 million euros ($100.7 million), down from EUR111.6 million. Revenue was EUR1.695 billion compared with EUR1.70 billion a year prior. Analysts had forecast revenue at EUR1.68 billion, according to the company-compiled consensus.

Pirelli confirmed its full-year guidance.

Write to David Sachs at david.sachs@wsj.com

(END) Dow Jones Newswires

May 09, 2024 13:21 ET (17:21 GMT)

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