Finland's Nokian Tyres lifts sales outlook despite Russia uncertainty
Finland's Nokian Tyres (TYRES.HE) on Friday nudged up its sales guidance despite an uncertain operating environment related to Russia, home to its largest production plant.
The company, which used to make 80% of its passenger car tyres in neighbouring Russia, turned from basking in record earnings to survival mode in February when Moscow launched what it calls a "special operation" in Ukraine.
"However, tire demand has remained good and Nokian Tyres has succeeded in implementing price increases to mitigate cost inflation. Therefore, the company raises its net sales guidance for 2022," it said in a statement.
The company now expects 2022 net sales to decrease or to be at the previous year's level, compared to previous guidance of sales to decrease significantly from 2021.
Its operating profit is still expected to decrease significantly this year, it added.
"In the second half of the year, Nokian Tyres' tire supply will be severely limited by the sanctions, having a negative impact on segments operating profit.
Significant uncertainties remain in the outlook for 2022," it added, referring to Western sanctions against Moscow.
Its shares were up 9% at 1120 GMT.
Nokian Tyres has previously warned it would not be able to replace reduced capacity from its Russian production facility this year.