CTTAF - Continental stock drives higher on strong pricing power upbeat sales outlook

2023-03-08 10:43:34 ET

Continental AG ( OTCPK:CTTAF ) shares rose sharply on Wednesday after the company posted strong Q4 earnings and forecast continued resilience for the business into 2023.

The German tire manufacturer posted a 17.9% jump in Automotive segment sales to €4.82B bolstered by both volume and price increases. Meanwhile, a 12.3% rise in tire sales from Q4 2021 to €3.7B was supported by 19.1% in price increases to offset inflation. ContiTech sales rose 12.1% year over year to €1.68B, despite higher production costs and business restrictions in China.

“Despite facing challenges, we performed well operationally,” CEO Nicholas Setzer commented. “We met our sales and earnings forecasts for the Continental Group ( OTCPK:CTTAY ) and achieved a respectable result.”

He added that the company worked to widen its supplier base to stave off further supply chain issues in the future. The cost and supply chain improvements as well as pricing actions are expected to sustain strong performance despite persistent inflationary headwinds.

Total sales for the year ahead are expected to range from €42B to €45B, up from €39.4B in 2022. Consolidated EBIT margin is expected to range from 5.5% to 6.5% in 2023, up from 5% in 2022.

The company also announced a €1.50 per share dividend.

Shares of Continental AG ( OTCPK:CTTAY ) rose 7.04% near the close of the European session on Wednesday.

Dig into the company’s financials .

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