MILAN, July 23 (Reuters) - Italian industrial group Pirelli is expected to report first-half operating profit up by more than a quarter thanks to a strong performance by its tire business, analysts said on Friday.
Pirelli, which publishes its results on July 29, is seen reporting earnings before interest and tax (EBIT) of 179 million euros ($219.5 million), up 26.1 percent from the same period last year, according to the median of forecasts by six analysts polled by Reuters.
Revenues were expected to rise 4.9 percent to 3.5 billion euros, with EBIT margin reaching 5.2 percent.
Some of the analysts polled saw EBIT at the tire business rising 10 percent to 140 million euros, making it responsible for 80 percent of total operating profits.
Pirelli has been expanding its tire business in an effort to offset a slump in demand for cables, its second business.
It has also cut jobs and other costs as it aims to boost profits by an annual 25 percent from 2004 to 2006.
In the first quarter, Pirelli posted a net profit after a string of quarterly losses.
But analysts expect net debt to widen to 2.10 billion euros from 1.96 billion euros at the end of the first quarter, partly due to a stake purchase in Italian publisher RCS Mediagroup .
Poll figures:
Average Prior Year
Revenues 3.460 bln 3.298 bln
EBIT 179 mln 142 mln
Net debt 2.088 bln 1.959 bln *
NOTE - (*) At the end of March 2004