(News Bulletin 247) – The tire manufacturer has reported a cash outflow for the whole of 2022. The forecasts for 2023 are also considered to be cautious by analysts.

Inflation weighed on the cash of the bibendum. The tire manufacturer Michelin has, over the whole of the 2022 financial year, recorded a free cash outflow of 180 million euros, to be compared with a positive flow in 2021 of 1.36 billion euros.

“This variation is mainly explained by the impact of inflation factors on the elements of the working capital requirement, as well as the increase in investments”, explains the company in the press release presenting its annual results, published Monday evening. . UBS evokes a figure higher than expected, the consensus counting on a flow in the green up to 326 million euros.

Still, this odd does not tense the market, the title Michelin giving up only 0.7% around 3:10 p.m., to 29.22 euros. For Deutsche Bank, this spread on cash “should not be a major surprise” insofar as the German Continental had issued a profit warning which already announced the color for the sector. The group from across the Rhine had indicated in mid-January that its cash generation had stood at 200 million euros in 2022, while the company was counting on a figure three to four times higher.

“A chaotic context”

Beyond cash generation, Michelin’s income statement did not hold any unpleasant surprises. Sales increased by 20.2% over one year to 28.59 billion euros, slightly more than the consensus (28.16 billion euros). The group was driven by favorable changes in exchange rates (6.2%) and scope (1.2%), as well as price effects (rise in prices) and “mix” (a stronger contribution from sales more expensive products) which had a combined positive impact of 13.7%. On the other hand, volumes had an unfavorable effect of 2%, Michelin attributing this decline to the cessation of its operations in Russia in March as well as to the effects of confinements in China.

At 3.4 billion euros, the so-called “segment” operating profit (operating profit restated for certain other operating income and expenses), the group’s main indicator of profitability, slightly exceeded the 3.37 billion expected by analysts. . Net income stood at 2 billion euros, compared to 1.845 billion euros in 2021.

“In a chaotic context impacted by several systemic crises, Michelin delivered solid results in 2022,” said Florent Menegaux, chairman of Michelin’s management, in a press release.

For 2023, the tire manufacturer expects to generate operating profit (always called “sectors”) of more than 3.2 billion euros at constant exchange rates and free cash flow before acquisition of more than 1.6 billion euros. euros. In particular, the group assumed volumes that were at best stable and at worst down 4% and an impact of cost inflation of between 600 million euros and 1.2 billion euros.

These forecasts are considered “conservative” by Deutsche Bank. However, the German bank believes that the group has offered itself a safety cushion with these forecasts, and can thus reserve good surprises in the event that “the economic environment does not deteriorate significantly”.