Nokian Renkaat Oyj, the Nordic region’s largest tire maker, fell the most in more than two months after it said second-half operating profit will decline on weak demand and lower prices in Europe.
Nokian Renkaat, also known as Nokian Tyres, plummeted as much as 12 percent, the biggest intraday drop since Aug. 5, to 29.94 euros and was down 11 percent as of 3:08 p.m. in Helsinki trading. Michelin & Cie, Europe’s biggest tiremaker, fell as much as 5.2 percent, while Continental AG, the region’s No. 2 tiremaker, dropped as much as 4.8 percent.
“Due to central European lower prices and clearly weakened demand, Nokian Tyres’ operating profit in the third quarter and in the second half will be weaker than in 2011,” the Nokia, Finland-based company said today in a statement.
European replacement tire sales, which account for about 75 percent of the tire industry’s revenue, will fall around 5.9 percent this year before rising 6 percent in 2013, Goldman Sachs Group Inc. said Sept. 12. The region’s car sales plunged 11 percent in September, the biggest drop since October 2010, the European Automobile Manufacturers’ Association said today.
Nokian Renkaat’s third-quarter operating profit was about 85 million euros ($111 million) and revenue reached 365 million euros, the Finnish company said today. The figures missed analyst estimates for earnings before interest and taxes of 105 million euros and revenue of 382 million euros.
The company maintained its forecast that 2012 sales and operating profit will be higher than last year. Nokian Renkaat is scheduled to publish its full third-quarter earnings report on Oct. 30.
Trading volume on the Nokian Renkaat stock rose to 2.26 million shares today, more than four times the three-month average.