HELSINKI -Finland’s Nokian Tyres on Tuesday posted a surprise fourth-quarter operating loss due to lower passenger car tyre supply volumes as it divests its production plant in Russia.
In October, the tyre maker agreed to sell its Russian plant, where it used to make 80% of its passenger car tyres, due to Moscow’s invasion of Ukraine but was not immediately able to ramp up sufficient production elsewhere.
Nokian said it made an operating loss of 13.5 million euros ($14.45 million) in the quarter, down from a profit of 53 million a year earlier, missing analysts’ average forecast of a 22.1 million profit in a company-provided poll.
“The first half of the year will be demanding as we are lacking supply, but we expect our volumes to start picking up again from the second half of 2023 onwards,” Chief Executive Jukka Moisio said in a statement.
In November, Nokian announced plans to invest 650 million euros in a new passenger car tyre factory in Romania to replace some of the lost output from its Russian operation.
Nokian agreed to sell its Russian operations to local oil producer Tatneft PJSC for 400 million euros, although there was substantial uncertainty over the closing of the deal.
In December, the company said Chinese Qingdao Sentury Tire would start tyre production for Nokian as a subcontractor, to replace some of the lost output from Russia.
($1 = 0.9342 euros)