Financial information for the nine months ended September 30, 2019

• In weaker than expected markets, Michelin's volumes declined by 0.8% in the first nine months of 2019, with in particular:

  • A contraction in Automotive tire volumes, in line with the markets. Sustained growth in the 18-inch and larger segment

  • A decline in Truck tire volumes in increasingly difficult markets

  • Growth in the mining tire business, in line with expectations

  • A steeper than expected drop in the Agricultural and Construction tire markets

• A 2.1% improvement in the price-mix effect, attributable to:

  • Disciplined price management in every business and region, in particular with price increases in the third quarter

  • A strong mix effect, shaped by a favorable business-mix and a firm product-mix in the Automotive segment

• Contribution from acquisitions in line with expectations (+7.1%)

• Sustained deployment of the competitiveness plan

In 2019, the Passenger car and Light truck tire markets are expected to decline by 1%, as the modest 1% growth in the Replacement segment fails to offset the steep 6% contraction in the Original equipment segment. Truck tire markets are expected to weaken more quickly in the fourth quarter, to end the year down 4%. Specialty tire markets will probably remain stable over the full year, as sustained demand for Mining and Aircraft tires helps to cushion the sharp contraction in the Agricultural and Construction markets. The full-year impact of raw materials costs and customs duties is estimated at around a negative €100 million.

In this scenario, Michelin confirms its guidance for 2019, with volume growth in line with global market trends; segment operating income exceeding the 2018 figure at constant exchange rates and before the estimated €150 million contribution from Fenner and Camso; and structural free cash flow of more than €1.45 billion.*

*Of which €150 million from the application of IFRS 16.