Continental slides into the red due to extraordinary burdens - Continental’s €756M Loss Overshadows Strong Tire Division Growth in Q3
Continental AG, the German automotive supplier and tire manufacturer, has reported a net loss of €756 million in the third quarter. This is primarily due to one-off effects from its ongoing corporate restructuring. Despite this, the company's core operations showed resilience, with revenue remaining stable at €5.0 billion.
The company's adjusted earnings before interest and taxes (EBIT) declined by nearly 15% to €565 million. However, Continental's tire division continues to be its most profitable segment, accounting for more than two-thirds of group revenue and achieving an adjusted operating margin of 14.3%. This segment showed strong momentum in its winter tire business.
In September, Continental completed the spin-off of its automotive supplier unit, Aumovio, via an initial public offering (IPO). The company also plans to fully divest the Contitech plastics division by the end of 2026, transforming itself into a pure tire manufacturer. The Contitech plastics technology division, contributing 30% to group revenue, achieved a 6.6% operating margin. Despite pressures from currency fluctuations and U.S. tariffs, Continental reported solid replacement tire sales for passenger cars in North America and Asia.
Continental's earnings were impacted by one-off effects, including exceptional pre-tax and pre-interest charges totaling €1.1 billion from the spin-off of Aumovio and the sale of part of its plastics technology business. Despite these challenges, the company's core operations showed strong performance, particularly in its tire division. Continental's transformation into a pure tire manufacturer is expected to be completed by the end of 2026.
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