Michelin (ML) H2 2024 earnings summary

Executive summary

• Segment operating income reached €3.4 billion in 2024, with a 12.6% margin at constant FX, despite a 5.1% drop in tire volumes and challenging market conditions.

• Sales totaled €27.2 billion, down 3.1% at constant FX and 4.1% year-over-year, mainly due to lower volumes and negative currency effects, partially offset by a strong positive mix effect.

• Free cash flow before acquisitions was €2.2 billion, the second-best in company history, and net income was €1.89 billion; dividend proposed at €1.38 per share, a 52% payout ratio.

• Strategic focus on value-driven segments, innovation, sustainability, and expansion into services and polymer composite solutions, with continued progress on the Motion Strategy 2030.

• Employee engagement rate rose to 84.7%, with 57% employee shareholder subscription and living wage certification for all employees; sustainability progress included a 13% reduction in CO2 emissions (scopes 1 & 2) and a 3-point increase in renewable/recycled material rate.

Financial highlights

• Segment operating income: €3.4 billion (12.4% margin), down from €3.6 billion (12.6%) in 2023.

• Sales: €27.2 billion in 2024, down from €28.3 billion in 2023; volumes fell 5.1%, price-mix effect +2.0%.

• Free cash flow before M&A: €2.2 billion (2024), €3.0 billion (2023).

• EBITDA margin at 19.7%, with EBITDA of nearly €5.4 billion.

• Net debt reduced to €3.1 billion, with gearing at 16.7%.

Outlook and guidance

• 2025 guidance targets higher segment operating income at constant FX and free cash flow above €1.7 billion, excluding M&A.

• Markets expected to remain volatile, with flattish or slightly positive growth in passenger car and truck tires; OE markets expected to recover in H2 2025.

• Anticipated rebound in OE volumes in H2 2025, with continued growth in replacement, mining, aircraft, and polymer composite solutions.

• New product launches planned across all segments in 2025.

• 2026 objectives reaffirmed.