Slow Demand Makes Pirelli Trim Full-Year Target image

Due to a general slowdown in demand, Pirelli has cut its investment plan and full-year sales target.

After the company reported first quarter profit higher than expectations, it now declared that slow demand has forced it to make some changes in the sales target and investment plan. On Tuesday, May 8th, Pirelli said it now expects for 2012 revenue to rise 14% to 6.45 billion euro, down from its previous goal of 6.6 billion. Investments will also fall from 560 million to 500 million. The company left the target for earnings before interest and tax at 800 million euro.

First quarter net profit was up 54% to 125 million euro, but down from the predicted 100 million. The company also made some changes in the management, Francesco Gori, Pirelli & C. SpA managing director and chief executive of Pirelli Tyre, stepping down its function due to the company’s decision to eliminate its position. Pirelli hopes that this will shorten decision taking time and the chain of command. Instead of Gorj the company named Maurizio Boiocchi as chief technical officer, being in charge of processes, products and its Team Motorsport.