Boston, MA 05/06/2014 (wallstreetpr) – The $1.7 billion replacement tire manufacturer and marketer Cooper Tire & Rubber Co (NYSE:CTB) may benefit from a Mississippi aid and local tax breaks if it commits to certain conditions. The planned financial aid is expected to be spread over three years starting with the current year.
Mississippi is considering a $20 million borrowing to extend aid to Cooper Tire & Rubber that the state so desperately wants that it may maintain or increase jobs positions at the Tupelo plant. The funding is also expected to support the plant upgrading activities. The company already has about 1,300 jobs in the plant and the state hopes that more aid and tax breaks will entice the company to increase job positions at the Tupelo plant, besides addition investment of about $140 million.
Already government officials are engaging the company in talks that are expected to lead to agreement next month. If an agreement is reached, Cooper Tire & Rubber Co (NYSE:CTB) will receive $8 million in July and a yearly aid of $6 million for two years. The July date for the initial aid is set to match the fiscal year of the state.
Executive hail 1Q despite drops
Cooper Tire & Rubber Co (NYSE:CTB) reported profit and revenue decline in 1Q2014 but the management did not see that as an issue, instead praising the performance. According to the management, profit in the quarter was the second biggest 1Q profit in the company’s history. The company noted its highest 1Q profit in 2013.
The company reported net income of $51.7 million, about 18 percent below the mark achieved in 2013 during the same quarter. Operating profit in the latest quarter was $81 million, missing the 2013 figure by $16 million. Sales in the latest quarter were $769 million, down $65 million from sales in 1Q2013.
No cause for alarm
Though 1Q2014 resulted in drops, in several performance columns, the company expects the current quarter and the year as whole to be positive if not better than the previous one.
According to CEO Roy Armes, the latest quarter was impacted by some issues that are not expected to reoccur in the balance of the year. Thus, there is no cause for alarm about the company’s prospects.
