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Financial Information for the Six Months Ended June 30, 2015

First-half 2015 : Robust growth and improved free cash flow

Revenue up 8.5% to €10,497 million

Operating income up 9% to €1,262 million (12% of net sales)

Full-year outlook: Guidance confirmed

  • Volumes rose 2.4%, outperforming the markets
    • Passenger car/Light truck tire sales clearly outpaced the market
    • Truck tire and Specialty business volumes were slightly better than their markets
    • Faster growth from quarter to quarter, in uneven markets that were strong in mature economies and sluggish in the majority of the new markets.
  • A quarter-on-quarter improvement in the price mix
    • As expected, changes in price mix and raw materials prices had a net negative effect, reflecting in particular the contractual price adjustments under raw materials-based indexation clauses, and managed price repositionings.
  • A €132 million improvement in free cash flow, excluding the Blackcircles.com acquisition and the investment in an Indonesian rubber plantation.

Michelin achieved strong growth in the first half of the year by leveraging its broader portfolio of solutions, by expanding access to customers and by capturing the rising demand in its traditional markets. The success of our most recent lines, like the MICHELIN CrossClimate and the new BFGoodrich tires, as well as our strengthened positions in the original equipment segment, confirm the importance of innovation for the Group's growth. Combined with the expected deployment of the competitiveness plan, Michelin can confirm its full-year guidance.

Jean-Dominique Senard, Chief Executive Officer

Outlook for 2015

With tire demand expected to remain on an upward trend in mature regions but more challenging in new markets, Michelin's objective for the second half is to pursue the growth trends observed in the first six months of the year. Changes in price mix and raw materials prices are expected to have over the full year a net negative effect on the businesses subject to contractual raw materials indexation clauses and a net neutral effect on the remaining businesses. The sustained deployment of the competitiveness plan will help to offset cost inflation over the year.

The Group confirms its target of delivering an increase in operating income before non-recurring income excluding the currency effect, a return on capital employed in excess of 11%, and structural free cash flow of more than €700 million, while pursuing a capital expenditure program totaling around €1.8 billion.


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