In Q1 this year Tire Company Dębica S.A. generated a net profit of PLN 19.7 million, which was up by 79% on a year-to-year basis. The sales revenues were up by 24.6% on a year-to-year basis and totaled PLN 521 million due to higher volume of tires sold and an increase of tire unit prices. The performance improved especially due to higher exports of truck tires and higher domestic demand for consumer tires.

In Q1 2011 the sales revenues were up by 24.6% on a year-to-year basis and totaled PLN 24.6% million due to higher volume of tires sold and an increase of tire unit prices.

Compared to Q1 2010the sales of Tire Company Dębica S.A. was up to the Goodyear Group entities by 19 per cent in the truck tire segment and by 8 per cent in the farm tire segment. The volume of truck tires sold to the non-related entities rose even faster, because by as much 34 per cent, whereas consumer and commercial tires by 7 per cent. The average actual prices on the sales to the related entities were up by 13 per cent, and to the non-related entities by 7 per cent.

The tire market is clearly recovering, what translates into growing sales of our tires both in Poland and abroad. The only barrier that remains are high prices of raw materials that forced us to increase tire prices and still represent a threat to sales profitability” – says Jacek Pryczek, President of Management Board of Tire Company Dębica S.A.

In Q1 2011 total gross profit on sales amounted to PLN 50.1 million and was up by 21.9 per cent compared to the same period in the previous year. The Company generated that profit despite raw material price hikes by 27.2 per cent, which translated into higher production costs by 16.9 per cent. Higher raw material prices were offset with production cost savings.

In Q1 2011 the export sales in value terms totaled PLN 357.6 million and accounted for 68.6%  of total products sold. The sales to the Goodyear related companies accounted for 99.8% per cent of total exports. The domestic sales in value terms reached PLN 163.4 million, of which 54.8 per cent was purchased by Goodyear Dunlop Tires Polska. Total sales to the Goodyear Group’s related entities accounted for 85.7 per cent of total sales in value terms and for 87.5 per cent of total sales in tonnage terms. In the same period last year these figures were 85.9 per cent and 88.1 per cent respectively. In Q1 2011 the sales to the non-related entities was up by 26.1 per cent compared to the last year and it totaled PLN 74.6 million.

In Q1 of the current year the share of sales and general management costs of Tire Company  Dębica S.A. in sales revenues was down from 5.22 to 5.15 per cent, and these costs in value terms amounted to PLN 26.8 million. Due to sales growth both in volume and value terms this figure is up by PLN 5.0 million compared to the same period of 2010.

The operating profit (EBIT) was up by 25.9 per cent and it totaled PLN 22.6 million.

In Q1 2011 the financial activity net income totaled PLN 1.8 million and was up by PLN 5.9 million compared to the same quarter of last year due to foreign exchange gains/losses that were down by PLN 5.8 million, loan servicing costs that were down by PLN 0.2 million and lower other interest expense by PLN 0.1 million. The revaluation of embedded derivatives generated revenues of PLN 2.2 million, down by PLN 0.3 million compared to the results recorded 12 months ago.

In Q1 2011 Company’s total gross profit on sales amounted to PLN 24.4 million, while net profit to PLN 19.7 million, which accounted for 76.8%  and 79.3% growth respectively compared to the same period in 2010.

In Q1 2011 the fixed assets of Tire Company Dębica S.A. in value terms were up by PLN 0.9 million, whereas current assets in value terms were up by PLN 7.3 million. Meanwhile the short-term receivables were up by PLN 6.8 million, whereas short-term prepayments were up by PLN 0.2 million. The short-term financial assets were reduced by PLN 8.0 million.

In Q1 2011 the short- and long-term liabilities fell by PLN 13.1 million and PLN 1.3 million respectively. Current account overdraft facility liabilities were up by PLN 6.9 million, whereas the provisions for liabilities were up by PLN 20.0 million. Long-term liabilities related to revaluation of embedded derivatives were down by PLN 1.0 million , while lease payables were down by PLN 0.3 million.

Total liability provisions were rose up to PLN 2.9 million including an increase for deferred income tax assets by PLN 1.5 million, and an increase of provision for employee benefits by PLN 2.0 million. Other short-term provisions fell by PLN 0.6 million.

At the end of March 2011 the equity of Tire Company Dębica S.A. was PLN 788.0 million and rose during the first quarter of 2011 by PLN 19.7 million by the value of net profit generated in that period.
 
In Q1 2011 the operational cash flows totaled PLN 2.7 million. Investment activity outflows totaled PLN 15.5 million. Meanwhile financial activity cash flows were positive and amounted to PLN 5.9 million including current account overdraft facility proceeds in the amount of PLN 6.9 million of which PLN 0.5 million was allocated to lease payments and another PLN 0.5 million to cover interest expense.Net cash flows were negative and amounted to PLN (6.9) million, while cash balance in the balance sheet was down by PLN 6.3 million.