The Board of Directors of Prometeon Tire Group (PTG), the only tire company fully focused on the Industrial sector, for the transport of goods, people, and the AGRO and OTR (Off The Road) segments, has approved the Consolidated accounts relating to fiscal year 2020.
During this fiscal year, the recovery path of the Prometeon Tire Group, which began in 2018, was completed, allowing the Group to improve resilience and offer customers ever more efficient products. During these two years, the Group’s journey has involved the implementation of a wide range of strategic activities across the entire commercial division and the value chain of the Prometeon Tire Group, such as R&D for the development of new products, their manufacture and marketing, the management of partner and supplier relationships, and the management of human resources processes.
KEY ECONOMIC AND FINANCIAL DATA FOR 2020 Figures show an improvement in EBITDA margin, despite a contraction in revenues due to the global spread of the COVID-19 pandemic. The pandemic has also had obvious spillover effects on the demand for industrial tires and has led to instability in currency movements, mainly in emerging countries. Prometeon Tire Group has been able to face this situation while securing the generation of cash and strengthening its capital structure.
More in depth, Prometeon achieved a turnover of 912.1 million euros (-15% compared to 2019), of which 12% was due to the unfavorable effect of exchange rate fluctuations. Excluding the currency effect, the overall organic difference would have been only 3% negative. From a geographical point of view, in fact, the revenues of the large macro-regions are appreciably in line with those of the previous year (EMEA -2% and Americas -1%), although the negative impact of the change in Latin America was particularly significant (over 20%).
EBITDA, which amounted to 123.9 million euros, was slightly lower than the previous year. The EBITDA margin amounted to 13.6% of sales (compared to 12.3% in 2019) and the increase is due to a positive recovery trajectory started in 2018, as well as to the positive contribution of all the efficiency recovery measures quickly implemented, which were coupled with the positive effects of the actions of previous years.
The net result for the period is positive, amounting to 2.7 million euros, compared to 7.8 million euros in 2019, in line with the trend in operating income.
The Net Financial Position – at 454 million euros – is up compared to 474.2 million euros in 2019. This performance is largely due to the positive impact of net income and the prudent management of working capital. , with particular attention to optimizing inventory levels and managing customer collections.
During the year 2020, the foundations were also laid for the possibility of extending the senior loan until March 2022, also thanks to the involvement of the majority shareholder, who – at the beginning of 2021 – granted a loan of shareholder in the amount of 200 million euros, in order to partially repay the senior loan earlier than expected, thus strengthening the capital structure of the company. The proforma1 NFP compared to third parties at the end of 2020, is reduced to 196 million euros, compared to 416 million euros at 31.12.2019.
In the year 2020, Prometeon Tire Group managed to increase market share in all its main reference markets and also improve margins through the implementation of measures both on turnover ( to mitigate exchange rate effects) and on costs, where actions have been taken in all areas and departments, starting with manufacturing, in order to compensate for the effects and inefficiencies due to temporary production stoppages in the second quarter.
ORIENTATION 2021 In a market scenario which remains strongly impacted by the current pandemic, PTG continues to implement a commercial and profitability action plan, which aims to achieve the objectives of its business plan while maintaining its axes unchanged development strategies, in particular: – Improved market shares, thanks to growth rates higher than those of the individual reference markets; – Consolidation of positioning in the Tier 1 segment, by strengthening partnerships with equipment manufacturers and expanding the range of services offered to customers; – Maintained focus on profitability, competitive projects and cash generation.
1 The pro forma means, including the injection of a shareholder loan, actually took place at the beginning of February 2021.
2020 SUSTAINABLE DEVELOPMENT REPORT The Consolidated Financial Statements drawn up today also include the Sustainable Development Report drawn up on a voluntary basis, proof that this issue is a fundamental pillar of the Group’s strategy, through specific commitments made in four strategic dimensions: Governance & Business Ethics, Social, Environment and Economy. In 2020, Prometeon joined the United Nations Global Compact and was named a founding member of the Global Compact Network Foundation Italy. The Foundation supports and encourages the United Nations program, which aims to share a set of principles to implement the values ââof long-term sustainability through responsible actions, policies and practices.
A TURNAROUND WORK METHOD The NewWay 2.Work is one of the most remarkable initiatives of 2020. NewWay2.Work is the organizational concept that has been designed to meet the structural needs that the pandemic has brought to light and accelerated. It is based on a hybrid work model combining remote work and the centrality of the physical workplace in which certain activities are carried out. Prometeon’s NewWay2.Work is built on three guiding principles and four enablers. Flexibility, responsibility and trust and mutual support and lifelong learning guide the approach as the development of a new employee experience, a new set of skills, a review of the workplace and a focus on culture and leadership become the areas where the model is executed. Time management becomes really flexible, requalification is based on many hours of training at a global level, individual offices are replaced by spaces for sharing and confrontation, the new identity of Prometeon takes over with its 5 convictions and a clear goal. GOVERNANCE CHANGES In December 2020, PTG shareholder Aeolus Tire and majority shareholder China National Tire & Rubber Corporation, Ltd (CNRC) entered into an agreement under which Aeolus will exercise the voting rights of 52% of the group’s shares. Prometeon Tire indirectly owned by NRC. The three-year agreement, extended by tacit agreement, will allow the two companies to build synergies in terms of technological innovation and production capacity, in order to provide customers with ever more efficient products and services. value on the one hand, and optimize procurement processes through closer working relationships with business partners, such as suppliers, on the other hand.
In addition, Giorgio Luca BRUNO will continue to support the industrial activities of Prometeon Tire Group. As announced on March 31, the Executive Vice President and General Manager of Pirelli, Marco Tronchetti Provera, proposed to the Board of Directors to invite the General Meeting of Shareholders scheduled for June 15, 2021 to appoint Giorgio Luca Bruno as director and will also propose that once appointed as a member of the board of directors, he will assume the role of deputy general manager.
Giorgio Bruno, CEO of Prometeon Tire Group, commented on the performance of the year: âThese results mark the completion of a turnaround process launched three years ago in which we have implemented several
strategic initiatives that have made Prometeon healthier, stronger and more resilient in an unprecedented scenario. Strategic interventions at each stage of the company’s value chain, a very strong emphasis on sustainability and human resources have enabled our company to fight quickly and effectively against the pandemic, further improving margins, protecting the treasury and by strengthening the debt structure, thanks to the involvement of the majority shareholder. “
Gregorio Borgo, COO of Prometeon Tire Group, said: â2020 has been a remarkable year, both because of the context in which the company has operated and because of the exceptional response from all of our employees, who work in a radically new way inspired by the most modern management concepts. NewWay2.Work is an organizational paradigm symbolizing the company’s attention to all stakeholders, both internal and external, and certified by its inclusion in the United Nations Global Compact. We will continue on the strategic path we have mapped out, remaining focused on improving our product and customer service offering, consolidating our partnerships with OEMs and further increasing levels of quality and efficiency. In this way, we will be able to continue on the path of growth in a market scenario that is increasingly aware of sustainability and the interests of each stakeholder â.