Bandag Inc., a retread tire maker based in Muscatine, IA, said its sales in the third quarter of 2001 dropped 3%, with consolidated net earnings declining 18%.
Bandag reported consolidated net earnings of $14.6 million for the third quarter of 2001, a decrease of 18% compared to net earnings of $17.9 million in the same period last year. Bandag added that consolidated net sales for the third quarter of 2001 declined 3% to $261.7 million from net sales of $269.9 million in the same quarter of 2000.
The retreader said that corporate expenses increased significantly in the third quarter largely due to higher legal expenses related to an ongoing lawsuit against Michelin. Litigation expenses for the quarter reached $4.5 million, up from $1.6 million for in the same period last year.
For the first nine months of 2001, Bandag said its consolidated net earnings declined to $26.5 million on net sales of $715.7 million, compared to net earnings of $45.6 million and net sales of $743.3 million in the first nine months of 2000.
The company added that its outlook for the rest of 2001 and early 2002 is gloomy.
“Given the uncertainties of the economic slowdown and the aftermath of the terrible events of September 11, we don’t anticipate any significant recovery in the commercial truck tire business before the second half of 2002,” said Martin G. Carver, Bandag’s chairman & CEO.