Finnish tyre maker Nokian reports smaller loss than expected in Q2

Finnish tyre maker Nokian reported a smaller-than-expected second-quarter loss on Tuesday amid a drop in global car and tyre demand due to the coronavirus pandemic, though the smaller loss helped lift shares about 4% in afternoon trading.

Nokian's operating loss was 22.8 million euros ($-26.8 million) in the quarter, down from a profit of 94.1 million a year earlier, beating the average loss of 30.6 million expected by analysts in a poll commissioned by the company.

Shares were up 3.84% at 21.72 euros, after earlier surging nearly 5% on the earnings report.

In May, Nokian appointed Jukka Moisio as new chief executive, taking over from Hille Korhonen, whose three-year tenure was marked by decline of almost 50% in the company's value.

Moisio said the company had a strong balance sheet, having further strengthened its liquidity position in the first half of the year.

"Cash flow from operations turned positive in the second quarter as we managed our cash flow and took manufacturing downtime to reduce inventory levels," he said in a statement.

In addition to COVID-19, the group's passenger car tyres sales were negatively impacted by measures taken in Russia to reduce high carry-over stocks in its distribution channel, Moisio added.