Rubberway® is designed in compliance with the objectives of the Global Platform for Sustainable Natural Rubber (GPSNR).

 

The joint venture is due to begin business before the end of 2019 (subject to validation by the relevant antitrust authorities).

 

Rubberway® is a technological solution that maps and assesses practices and risks regarding environmental issues, social affairs, and Corporate Social Responsibility governance throughout the natural-rubber industry, from rubber-processing plants downstream to plantations upstream. Rubberway® will provide its users (tire manufactures) with  the collected data and enable them to identify and improve sustainability in the natural rubber chain.  .

 

Indeed, the natural-rubber supply chain—which includes around six million farmers, 100,000 intermediaries and over 500 processing plants—is highly complex.

 

The technological solution  Rubberway®—produced in collaboration with the software developer Smag—has been operational since 2017 and is already used in some main production countries (including Thailand, Indonesia, Ivory Coast, Nigeria, Ghana and Brazil).

 

In this joint venture, Michelin is bringing the rights of use and exploitation, as well as its user experience of it on the ground.

 

Continental demonstrates its interest in this solution through its investment in the joint venture and, in doing so, is opening up the path to wider use of the application by other tire-makers and car-parts manufacturers, therefore helping accelerate the rise of responsible practices in the natural-rubber industry.

 

Smag is sharing all its technological and sector-specific expertise in digital solutions for agriculture.

 

Through this joint venture, the partners are seeking to make Rubberway® an independent solution that can be easily used by all the other natural rubber players and working towards making the supply chain more transparent.

Michelin wishes to correct the information released today by the Reuters news agency regarding a joint venture with Continental and SMAG related to tyre production.

This joint venture will not be related to tyre production but is intended to further develop and deploy a mobile application called Rubberway, designed to map sustainability practices across the natural rubber industry.

Further information about this project will be provided shortly.

Compagnie Générale des Etablissements Michelin has called on the assistance of an Investment Services Provider for the implementation of its Share Buyback Program as authorized by the Annual Shareholders Meeting of May 17, 2019.

 

Under the terms of the Agreement signed on August 29, 2019, the parties agree that the Investment Services Provider will sell a certain number of Compagnie Générale des Etablissements Michelin shares, representing a maximum of €70,000,000, to Compagnie Générale des Etablissements Michelin, which undertakes to buy them, between September 2, 2019 and November 21, 2019, at an average price to be determined objectively and independently by the market over the duration of the Agreement, less a guaranteed discount. The price may not exceed the maximum purchase price approved by the Annual Shareholders Meeting of May 17, 2019

 

All of the shares bought back under the Agreement will be cancelled.

Michelin Group announced today that the 2019 half-year financial report is now available and has been filed with the French Autorité des Marchés Financiers (AMF).

 

The report and the first-half 2019 financial results presentation are available on the Group website, in the “Finance / Regulated information / regulatory informations CGEM-AMF” section.

In a more difficult than expected environment, segment operating income up 8% to €1,438 million

Rigorous price mix steering and competitiveness plan management

Contribution of acquisitions as expected

Guidance confirmed with a lowered market scenario

  • In weaker than expected markets, Michelin’s volumes declined by 0.9%, with in particular:
    • Group positions maintained in Passenger Car and Light Truck tires, in markets down 2% due to the fall-off in Original Equipment demand.
    • Stable volumes in Truck tires, in a market down 1%, benefiting notably from the deployment of Services and Solutions.
    • Further growth in the mining tire business, helping to offset the steep drop in agricultural tire volumes, due to declining markets.
  • The price-mix/raw materials effect added a net €79 million, thanks to sustained price discipline and continuous enhancement in the value of the mix.
  • €40 million in competitiveness gains, net of inflation.
  • €101 million contribution from recently acquired Fenner and Camso, as expected.
  • Acquisitions of Multistrada and Masternaut in line with the Group’s growth strategy.
In highly volatile markets, the Group demonstrated its ability to protect its margins by tight price steering, and by rigorously implementing its competitiveness plan. It also benefited from strong contribution from its recent acquisitions. In this persistently uncertain business environment, the Group pursues its competitiveness initiatives, its firm pricing policy in order to maintain its leadership in its tire businesses, and to continue the deployment of its growth strategy.
Florent Menegaux, Chief Executive Officer, Michelin

Guidance confirmed

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 4.4% contraction in the Original Equipment segment. The Truck tire markets are expected to decline more quickly in the second half, to end the year down 2%. Mining and aircraft tire markets should continue to expand, offsetting the steep drop in agricultural tire markets and in Original Equipment demand in construction tire markets. The full-year impact of raw materials costs and customs duties is estimated at around a negative €100 million, as forecast.

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.

Following a successful public offer, Michelin now holds 99.64% of the share capital of leading Indonesian tire manufacturer PT Multistrada Arah Sarana TBK.

 

In line with its strategy, Michelin acquired 87.59% of PT Multistrada Arah Sarana TBK (“Multistrada”), a tire manufacturer based in Indonesia, on March 8, 2019. As Multistrada is a publicly listed company, and pursuant to Indonesian regulations, the Group launched a public offer for the remaining outstanding shares, at the same price per share as that offered for the 87.59% stake. The transaction enabled Michelin to acquire an additional 12.05% of the share capital, bringing its interest in Multistrada to 99.64%. In total, the Group paid USD 545 million for the acquisition.

The Annual Meeting of Michelin shareholders was held on May 17, 2019 in Clermont-Ferrand under the chairmanship of the Managing Chairman Jean-Dominique Senard.

 

Shareholders adopted all of the resolutions submitted for their approval. These concerned, in particular:

  • The payment of a dividend of €3.70 per share, payable in cash as from May 23, 2019.
  • The advisory vote on the components of Jean-Dominique Senard, Florent Menegaux and Yves Chapot’s compensation as Managers for 2018 and of Michel Rollier, Chairman of the Supervisory Board.
  • The authorization for the Managers to grant performance shares to employees.
  • The re-election of Barbara Dalibard and Aruna Jayanthi as members of the Supervisory Board for a further four-year term until the end of the financial year ending December 31, 2022.

 

Marc Henry, Chief Financial Officer, noted the increase in segment operating income, which amounted to €2.8 billion in 2018 amid a challenging environment. He also emphasized the structural free cash flow of more than €1.2 billion generated in 2018, and the Group’s improved ability to structurally generate cash flow over the past few years.

 

On the back of a 9.3% increase in sales in the first quarter at constant currency rates, the Group confirmed:

  • The annual targets for volume growth in line with global market trends.
  • Segment operating income exceeding the 2018 figure at constant exchange rates and before the additional contribution of Fenner and Camso[1].
  • Structural free cash flow of more than €1.45 billion.[2]

 

Florent Menegaux, Managing General Partner since the Annual Shareholders’ Meeting of May 18, 2018 and Managing Chairman following this Meeting, went on to outline his strategic vision for the Group. His deeply-held conviction is that the Group’s sustainable growth needs to be based on three pillars of equal importance: financial performance that secures the company’s long‑term future, investing in our employees and their development and respect for the planet and its inhabitants.

 

He also highlighted the Group’s main strengths which are the MICHELIN brand, its technological leadership and the commitment of its teams, before reviewing the Group’s four domains of growth:

  • The Tire activity, which is Michelin’s core business. Thanks to its capacity for innovation, the premium status enjoyed by the brand and its market access, the Group offers customers increasingly high‑performance tires that are tailored to their needs. The Group will also have to boost its competitiveness and the efficiency of its manufacturing base to sustainably create value.

 

  • The Services & Solutions business, which revolve around tire-related services, connected mobility and fleet management solutions to unlock efficiency gains for business customers in their mobility.

 

  • The Experiences business, consisting of selections in fine dining, hotel accommodation, wine, travel and itineraries that provide the Group’s individual customers with the opportunity to enjoy unique experiences and buy into the MICHELIN brand.

 

  • The High-Tech Materials business, which leverage the Group’s expertise to deliver tailored and
    one-step-ahead responses to profitable growth markets such as reinforced polymers, biomaterials, hydrogen mobility and 3D metal printing.

 

Florent Menegaux emphasized the need to step up the pace of the Company’s digital transformation, which is a key component of technological leadership and a way to forge close ties with customers.

 

With its clear road map, the Group is confident about its future thanks to the commitment of its teams to meet its targets and transform it into a company of the future, one that is proud of its expertise and values.

 

After paying tribute to the vital role played by Jean-Dominique Senard at his side from the time he joined the Michelin group in 2005, Michel Rollier, Chairman of the Supervisory Board, praised the importance and quality of his contribution as Managing Chairman to the Group’s development. The sharp increase in earnings notably enabled Michelin to carry out key investments in the areas of growth and strategic acquisitions, and implement a balanced dividend strategy. Florent Menegaux for his part warmly commended the fruitful working relationship with Jean-Dominique Senard over the past twelve years and also read out a large number of testimonials from the teams at Michelin.

In an emotional conclusion, Jean-Dominique Senard expressed his immense pride in having headed the Group for all these years and thanked the teams throughout the world for everything they had given him.

 

The presentations to shareholders, vote totals on the resolutions and a webcast of the entire Annual Meeting will be posted on May 17, 2019 on the corporate website (www.michelin.com/eng).

 

 

[1] The additional contribution of Camso and Fenner is estimated at €150 million for 2019

[2] Of which €150 million due to the application of IFRS 16

In line with the Group’s development strategy in the Services & Solutions business and leveraging the experience it has gained following the Sascar and NexTraq acquisitions in America, Michelin announces it has signed an agreement to acquire the entire share capital of Masternaut, one of the largest European telematics providers.

 

Masternaut operates primarily in France and the United Kingdom. It provides a technical platform equipped with the latest technology and offers on-board fleet telematics solutions to optimize vehicle fleet management and monitoring. Masternaut manages over 220,000 mostly light utility vehicles under contract. The transaction has been made on the basis of 8 times 2018 Ebitda before synergies.

 

For Michelin, the acquisition will:

  • speed up the development of its Services & Solutions business for light vehicles and support the booming fleet market;
  • enable Masternaut to roll out its offering across the whole of Europe by taking advantage of the Michelin network's geographical coverage;
  • increase the volume of data captured, allowing it to offer its customers the best solutions, improve product performance and develop its data science deployments, such as predictive maintenance.
Michelin is consolidating its expertise in telematics, enabling us to optimize customer mobility and respond to the needs of a changing market. Masternaut represents a further step in the expansion of our Services & Solutions business, especially in Europe and for light vehicle fleets.
Florent Menegaux, Managing General Partner

The Annual Financial Report of Michelin Luxembourg SCS, comprising the audited annual accounts, the management declaration and the annual management report are available on the internet site of the Michelin Group at the following address: www.michelin.com/en, under the heading « Finance », « Regulatory information and publications », « Regulatory informations Michelin Luxembourg SCS – CSSF ».

COMPAGNIE GÉNÉRALE DES ÉTABLISSEMENTS MICHELIN has called on the assistance of an Investment Services Provider for the implementation of its Share Buyback Program as authorized by the Annual Shareholders Meeting of May 18, 2018.

 

Under the terms of the Agreement signed on April 26, 2019, the parties agree that the Investment Services Provider will sell a certain number of COMPAGNIE GÉNÉRALE DES ÉTABLISSEMENTS MICHELIN shares, representing a maximum of €70,000,000, to COMPAGNIE GÉNÉRALE DES ÉTABLISSEMENTS MICHELIN, which undertakes to buy them, between April 29, 2019 and November 21, 2019, at an average price to be determined objectively and independently by the market over the duration of the Agreement, less a guaranteed discount. The price may not exceed the maximum purchase price approved by the Annual Shareholders Meeting of May 18, 2018 or, if the shareholders adopt a new share buyback resolution on May, 17 2019 Annual Shareholders Meeting.

 

All of the shares bought back under the Agreement will be cancelled.

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