French tyre maker, Michelin on Tuesday projected lower operating income in 2020, saying the forecast did not include the systemic effect of the coronavirus crisis in China.
The Paris-based company, which restarted operations in its three factories in China on Monday morning, also forecast a free cash flow of more than 1.5 billion euros, also without accounting for the epidemic’s effects.
The death toll from the epidemic rose to 908 on Monday, as employees began trickling back into offices and factories around China after the government eased some restrictions on work and travel.
Michelin reported a 2019 segment operating income of 3.01 billion euros in 2019, up 179 million euros at constant exchange rates, and roughly in line with analysts’ estimates of 3.02 billion euros.
The group said volumes fell 1.2%, in line with overall markets, while its structural free cash flow beat guidance at 1.62 billion euros.
“In 2019, in a highly unstable environment, Michelin successfully maintained its market share and improved its earnings,” said Managing Chairman Florent Menegaux.
Michelin said it expected a slight decline in its 2020 passenger car and light truck tyre markets, while truck and off-road tyre markets should continue to soften.
