#Finland #Nokia #Nokian Tyres #Seasonal Tyres #Paolo Pompei

Nokian Tyres Shows Resilience with Strong Q2 2025 Financial Performance

Nokian Tyres plc released its Half Year Financial Report for January to June 2025, revealing notable growth and improvements in operational profits, particularly in the second quarter. This report not only solidifies the company’s market position but also highlights strategic actions aimed at enhancing financial performance.

Financial Highlights of Q2 2025

In the second quarter of 2025, Nokian Tyres achieved net sales of EUR 343.7 million, an increase compared to EUR 324.6 million during the same period in 2024. When considering comparable currencies, this marks a 6.9% sales growth. This increase surpasses market average growth rates, demonstrating the company's resilience across all regions. The operating profit for this segment also showed a remarkable 30.6% improvement, escalating to EUR 26.3 million from EUR 20.1 million year-over-year. This significant uplift was largely fueled by higher sales in passenger car tires, price adjustments reported in the first quarter, along with reduced manufacturing and supply chain costs.

Operating profit reached EUR 14.8 million, up from EUR 8.4 million in 2024, despite certain non-IFRS exclusions negatively impacting the overall figures. Earnings per share remained relatively stable at EUR 0.00 as compared to EUR 0.01 in the same quarter last year. Cash flow from operating activities also showed improvement, sitting at EUR 16.5 million, a substantial turnaround from a negative cash flow of EUR -57.9 million.

Six-Month Performance Overview

For the first half of 2025, Nokian Tyres reported net sales of EUR 613.2 million, up from EUR 561.2 million year-on-year, translating to a notable growth rate of 10.0% in comparable currencies. The operating profit improved significantly, reaching EUR 7.8 million compared to EUR 5.0 million in the first half of 2024. However, some setbacks were indicated in the annual earnings report reflecting an operating loss of EUR -21.1 million, impacted by various non-IFRS exclusions.

The company’s cash flow from operating activities for the first half was notably negative at EUR -105.3 million, compared to EUR -145.2 million from the previous year. This figure illustrated the tough economic landscape and strategic shifts undertaken by the company to align itself better with ongoing demands.

Executive Insights

Paolo Pompei, who commenced his role as President and CEO of Nokian Tyres at the start of 2025, noted that the company had significant improvements across all business units. "The Passenger Car Tyres segment outperformed the market, contributing greatly to our sales growth and supporting our operational profitability. We have taken substantial measures to improve our financial performance, and it is encouraging to see early positive results from these actions," Pompei remarked.

He also emphasized that the ongoing adjustments made to pricing strategies and product mixes are efforts aimed at offsetting increased raw material costs, as well as enhancing the company's foothold in the competitive markets of Central Europe and North America.

Operational Developments and Sustainability Initiatives

New operational initiatives started in 2025 aim to enhance efficiency and increase productivity across the organization. Formally, the company is focusing on cash management improvements. They reported ramping up operations in Romania according to schedule, with the commencement of commercial deliveries of the Nokian Tyres Seasonproof 2, designed for optimal performance in the all-season tire segment.

Additionally, Nokian Tyres has been recognized for its sustainability efforts, ranking 98th in TIME magazine's list of 500 most sustainable companies worldwide. This recognition underscores the company's commitment to environmental and social responsibility amidst fluctuating geopolitical dynamics.

Looking Forward

Looking ahead, Nokian Tyres continues to maintain its growth outlook for 2025, anticipating enhanced net sales and improved operating profits as a percentage of total sales. The company’s strategy involves boosting production capacity in its Romanian and U.S. factories while preparing for the volatility prompted by ever-changing geopolitical and economic landscapes.

In summary, Nokian Tyres is not just bouncing back but is positioning itself for sustained growth and success despite challenges. The continuous investment in production capacity and strategic operational shifts reveal a proactive approach to navigating the complexities of the global marketplace. As this year marks the conclusion of a significant three-year investment phase amounting to approximately EUR 800 million, the groundwork for future growth has been solidified, driving optimism throughout the organization.

For shareholders and stakeholders alike, keeping track of Nokian Tyres' journey will be crucial as they continue to adapt and thrive in the tire industry.