HELSINKI (Reuters) -Finland's Nokian Tyres set a long-term growth target on Tuesday to try to overcome the fall in business caused by the sale of its Russian plant, giving the company's share price a 6% boost.
Nokian last year lost 80% of its annual passenger car tyre production after sanctions against Moscow stopped exports, and the Finnish company later sold its Russian business to PJSC Tatneft for 285 million euros ($313.9 million).
The company on Tuesday posted a bigger than expected first-quarter loss as a result of the Russian exit, but reiterated expectations for a return to profit this year.
"The second half (of 2023) is expected to be stronger due to winter and all-season tyre sales and contribution from contract manufacturing," Chief Executive Jukka Moisio said in a statement.
Nokian's January-March operating result fell to a loss of 18.8 million euros ($20.72 million) from a profit of 21.5 million a year ago, missing the 16.3 million loss mean estimate in a company-provided poll of analysts.
Nokian predicted net sales could rise to 2 billion euros in the next five years, with an operating profit margin of some 15%.
This compares with the mean expectation among analysts in the poll for net sales of 1.38 billion euros in 2023 and with an estimnated operating margin this year of some 5%.
The tyre maker's share rose 6.2% to 9.1 euros shortly after the 1100 GMT announcement.
($1 = 0.9080 euros)