NEW YORK, N.Y. – Strong performance in North America and a royalty payment helped The Goodyear Tire & Rubber Co. overcome the impact of a strong dollar and beat Wall Street’s profit expectations.
Its shares rose more than 4 per cent in afternoon trading.
The Akron, Ohio-based reported first-quarter net income of $224 million, after reporting a loss of $58 million in the same period a year earlier.
On a per-share basis, the Akron, Ohio-based company said it had net income of 82 cents. Earnings, adjusted for non-recurring gains, came to 54 cents per share.
The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 45 cents per share.
The tire maker posted revenue of $4.02 billion in the period, which fell short of Street forecasts. Four analysts surveyed by Zacks expected $4.07 billion.
The company saw a slight decline in North American sales, but the unit’s operating income jumped 27 per cent, driven by lower raw material costs and higher volume. A stronger dollar hampered sales more severely in every other region.
But, the company recorded a one-time gain of $155 million for deferred royalty income from the termination of a licensing agreement associated with the company’s former Engineered Products business.
Shares rose $1.15, or 4.2 per cent, to $28.36 in afternoon trading Wednesday.
Goodyear shares have decreased almost 5 per cent since the beginning of the year, while the Standard & Poor’s 500 index has climbed almost 3 per cent. The stock has remained stable over the last 12 months.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on GT at http://www.zacks.com/ap/GT
Keywords: Goodyear, Earnings Report, Priority Earnings