In a difficult business environment, sales amounted to 6.5 billion in the first three month of 2022, an increase of 19%

Clermont-Ferrand April 26, 2022

COMPAGNIE GRALE DES TABLISSEMENTS MICHELIN
Financial information for three months ending March 31, 2022

In a challenging BusinessEnvironment, sales reached 6.5 billion in the first three month of 2022, A rise in 19%

The conflict in Ukraine, and the resurgence Covid-19 (China) exacerbated existing operational disruptions as well as inflationary pressures in the first three month of the year.

This is why markets continued to grow during the quarter.

• The Passenger car and light truck tire markets increased by 2% year over year, as replacement demand outpaced the operational difficulties experienced by automakers.

• Truck tire markets grew by 4%, excluding China, which saw a 37% drop in demand year-over-year.

• In spite of the fact that it was difficult to fulfill customer orders, demand for specialty tires rose in all markets.

• The quarter saw growth vary, with strong gains in January, February, and March, but a sudden cooling in March due the conflict in Ukraine and rebound in Covid-19 case in China.

Quarterly sales reached 6,481 millions, an increase of 19.0%. There was a 3.4% positive currency impact.

• The Group’s dynamic price management to respond to sharply rising energy, logistics, and raw material prices resulted in a sharp 11.9% increase

• 1.6% increase in the tire mix effect, due to faster growth in replacement sales (vs. Original Equipment sales in the Passenger car, Light truck segments increased by 1.6%, mainly due to faster growth in Replacement sales (vs.

• A 0.5% increase in tire volumes, but this was limited by multiple operational disruptions.

• The scope changes that resulted in a 0.8% increase are mainly due to Allopneus.com’s first-time consolidation

• Strong 11.9% growth in non-tire businesses

Guidance maintained

In 2022, markets will still see growth in an uncertain environment.

Continue the story

This scenario is acceptable, barring any rise in systemic impacts¹Michelin continues to follow its guidance with full-year segment operating earnings exceeding 3.2 billion at constant exchange rate and structural free cash flow²More than 1.2 billion.

First-quarter sales

Market Review

*Including Turkey
**Commonwealth of Independent States

The global Original Equipment and Replacement passenger car and light truck tire market ended the quarter 2022 up 2% in terms of number of tires sold. This is a result of strong growth in the initial two months (up 22% in January and 100% in February), followed by a global decline in March (-7%).

Worldwide Original Equipment tire demandThe period saw a drop of 6%, aided by the 14% drop in March, which was caused by the initial repercussions in Ukraine’s conflict, especially in Europe, at a point when components were already scarce.

In EuropeMarch’s market contraction was due to the conflict in Ukraine. This impacted automaker output. After these falls of 60% in CIS countries and 22% in Western Europe, the quarter ended with a decline in demand, which was 25% and 15% respectively, year-on–year.

AmericanMarketsThe decline in sales was slightly less than expected, due to tighter supply of auto semiconductors, but to a lesser extent than Europe.

Increased Demand ChinaThe quarter’s growth was only 2%. However, the surge in growth in the first two-months slowed in March. There was a 15% decline year-on-year due to the resurgence in Covid-19 cases. Many automotive plants were forced to close temporarily.

Increased Demand Southeast Asia And in theAfrica/India/Middle EastRegion fell mainly because of shortages in semiconductors.

Worldwide demand for replacement tires rose by 4% in the quarter to 2022. This was followed by dynamic growth in the first 2 months and a general contraction of 2% in March.

Markets Central and Western EuropeThe quarter’s growth was 10%, with 6% in March. This reflects the gradual return to normal mobility as well as active rebuilding of dealer inventories, in a context where prices are increasing frequently. The growth was led by the countries of Southern Europe (France and Spain), as well as Italy. The demand in Central Europe, especially in Poland, remained strong while the Turkish market was stable compared to the first-quarter 2021.

In CISAlthough demand was strong in the first 2 months, it plunged 54% to March after the conflict in Ukraine. Several Western carmakers stopped production in Russia and also stopped exports to Russia. The market ended the quarter down by 7%.

In need of replacement demand North and Central AmericaIn a similar environment to last year’s import duties environment,, increased 5% during the period. In March, US demand slowed down slightly, with an increase of 2% year over year, but it was strong in Canada, where it gained 8%.

Increased Demand South AmericaThe quarter’s increase was 3%, mainly due to normal mobility and wider access for vaccines. This helped to lessen the impact of pandemic.

In ChinaReplacement tire demand declined by 9.9% year-on year as robust gains in February and January were overtaken by a 20% year on year drop in March. This was caused by the resurgence Covid-19, and the strict lockdowns in some provinces.

Increased Demand Asia (excluding China, India)First quarter 2022 ended up 13%. This was mainly due to growth in every market, including Japan-South Korea (18%). Covid-19 has not stopped mobility from expanding in every country in the region.

The Africa/India/Middle EastThe market was nearly flat year-on–year in the region due to rising demand in Africa and the Middle East. This offsets a 6% decline from India.

*Including Turkey
**Commonwealth of Independent States. Markets as of February 28, 2022. Market data for March are not currently available due to the situation in Eastern Europe.

The number sold of new Truck tires worldwide dropped by 12% in Q1 2022, but rose 4% excluding China.

The global Original Equipment Truck tire industry, as measured in the number of new tires sold worldwide, fell by a significant 28% overall, due to the slump in China.

In Central and Western EuropeOriginal Equipment demand was stable in all three months of the quarter.

Markets CISwere trending upwards up until the conflict in Ukraine. March data are not available.

Insufficient OE demand North and Central AmericaThe period ended up 2%

In ChinaThe demand plummeted 52% from very unfavorable comparables. The market was boosted by the introduction of the China 6 emissions standards in July 2021.

The rest of the world is dominated by the South AmericanMarket grew by 11% and demand shot up by 52% Africa/India/Middle Eastregion, including a 63% rise in India thanks to the Indian government’s policy on scrapping vehicles older then 15 years.

The AsianMarket was stable from year to year.

The global replacement truck tire market fell by 5% in its first quarter 2022, with a 25% decline in China.

In Central and Western EuropeThe market grew by 8% during the period, boosted by strong freight demand, which drove growth in France-Benelux (12%) and Germany (15%).

Increased Demand North and Central AmericaThe period ended up 2% year on year, with a 3% rise in North America and a 8% decline for Mexico.

In CISThe market was up around 11% in the first two months of this year, before the conflict in Ukraine. Data for March are not available.

Markets South AmericaIn the first quarter of 2022, the overall growth was 5%. The strong 29% growth in Argentina’s demand from a favorable comparison led to an overall 5% increase. The Brazilian market saw a 7% growth.

In ChinaReplacement tire demand fell by 25% during the period. This was due to very unfavorable comparisons and mobility restrictions implemented in March following the resurgence Covid-19.

Asian markets The 7% increase was mainly due to strong gains in Japan-South Korea (14%), and Indonesia-Malaysia (9%)

The markets in the rest of the globe were mixed during the period, with 8% growth Africa/Middle Eastregion and a 15% contraction IndiaFrom a more favorable base of comparison.

• Mining tiresDespite high demand for ore, the mining tire market is still being held back due to production constrictions as well as downstream logistics issues.

• Construction and Agricultural tiresDespite rising farm commodity costs, agricultural tire markets are expanding. Construction and Infrastructure segments are experiencing sustained demand, especially for Original Equipment.

• Two-wheel tiresDemand for two-wheelers is growing, especially in the OE motorcycle/bicycle segments.

• Aircraft tires: Demand rose from favorable comparatives during the first quarter, especially in Commercial Aviation, which saw a sharp rebound at the beginning of this year. However, the recovery is still fragile due to China’s geopolitical instability as well as its health situation.

  • Conveyor belts: The market for conveyor belts in the Construction and Mining markets grew over the first quarter.

Michelin sales

*In tonnes

The first three months of 2022 saw sales totaling 6,481 millions. This is an increase of 19.0% over the previous year. This was due to the net effect of the following factors.

– A very small 0.5% (28 million), increase in tire volumes. This was due to robust demand in January, February, and March. The slowdown in March was caused by operational disruptions in Ukraine and the resurgence Covid-19 in China.

– A 13.5% rise from the very favorable Price-mix Effect. (i) A solid 11.9% gain from successive price hikes since second-quarter 202021 to offset rising prices and (ii). A 1.6% increase in the positive mix effect which stems from:

• There is a good mix of Original Equipment and Replacement Sales in the Automotive segment.

• Continuing improvement in product mix, led primarily by growth in the 18 inch and larger tire segment.

– 0.7% increase in non-tire sales compared to the strong 12% growth. This was driven by both higher Fenner sales as well as ongoing expansion in the fleet management industry.

– A 3.4% rise in exchange rate movements, mainly due to the gains in Brazilian real against the Euro and the US Dollar.

– A 0.8% increase due to changes in scope of consolidation, primarily Allopneus.com being included since December 30, 2021.

Automotive and related distribution

The Automotive segment saw sales of 3,254 million in the first quarter 2022, an increase of 20.8% over the previous year.
The markets increased by 2% but group volumes remained stable at 0.2 percent. This is due to inventory buildups by some dealers before the announcements of price increases and production disruptions related to the Ukraine conflict in Russia and Europe. A very favorable price-mix effect benefited business. This was due to (i) slow Original Equipment sales, especially in Europe, and (ii), highly disciplined pricing management in the Replacement business, which was supported with sustained enhancements of the mix within the expanding 18-inch tire segment.

Segment sales were also positively affected by the consolidation at Allopneus.com operations as well as currency rate movements.

Road transport and related distribution

The Road Transportation segment saw a 20.6% increase in sales to 1,674 millions in the first quarter 2022.
Group volumes increased by 2.6% in markets up to 4% (excluding China). This is due to inventory build-ups by some dealers before announced price increases. Also, production disruptions in Europe and Russia relating to the Ukraine conflict caused by Russia’s conflict resulted in a delay. The segment also enjoyed a strong price-mix effect due to price increases in 2021 and 2022, and a selective management approach that focuses on creating value.
Currency rate movements positively impacted segment sales.

Distribution of specialty businesses and related distribution

First quarter sales in the Specialty business grew 13.7% compared to 2021.
Volumes fell by 0.9% year-on–year due to persistent supply chain problems in the Mining segment, caused by shortages in maritime shipping capacity. This slowed shipments from Group plant.

Segment sales were also boosted by a positive effect on prices, which was a result of the non-indexed businesses’ pricing discipline.

• Off-road tires: Sales were boosted by the steady rise in demand for agricultural tracks and construction tires, which were especially strong in Original Equipment markets, and price increases that have been implemented since the second half 2021.

• Mining tiresDespite the fact that operational and production problems were being addressed, sales in still expanding markets were adversely affected by disruptions to downstream supply chains.

• Two-wheel tires: Business continued to be driven primarily by high demand and high utilization of capacity, with a very favorable price/mix effect.

• Aircraft tires: Sales continued to trend upwards in the General Aviation segment while the Commercial Aviation business enjoyed an impressive upturn in the early part of the year before slowing in March because of geopolitical events in China and the resurgence Covid-19 in China.

• FennerBusinesses that deal with conveyor belts, precision polymers, and engineered seals are seeing steady growth.

• Currency rate movements positively impacted segment sales.

Michelins All Sustainable vision

Fostering diversity-friendly work environments

Michelin strongly believes that diversity in backgrounds and experiences is a key to creativity, innovation, and mutual fulfillment. This belief also contributes to the Group’s social and economic performance. This is evident in the Groups score on the gender equality index, which was created by the French government in 2019 to support gender wage equality and workplace equality. Michelins score for France in 2021, as measured at Manufacture Franaise des Pneumatiques Michelin, rose sharply from 93/100 to 99/100.

Promoting safer mobility

Michelin will continue its commitment to safer mobility by a three-year partnership in Latin America with the Global Alliance of NGOs for Road Safety in Latin America. This region is where road accidents are a major concern. Michelin will support local NGOs’ training and coaching efforts to advance the United Nations global road safety program, which aims to reduce road fatalities and injuries by 50% by 2030.

Take action to stop global warming

The Michelin Group published its 2021 climate strategy in accordance to the Task Force on Climate-Related Financial Disclosuress (TCFD) principles. The strategy is organized around two key outcomes: i) a transition plan that decarbonizes direct and indirect activities (Scopes 1 and 2) and fosters a low-carbon economy; ii) an adaptation plan that prepares for the physical effects of climate change.

Supporting sustainable natural rubber

ESG rating. ZSL SPOTT was ranked number one in Michelin’s recent assessment. It is an ESG rating platform that focuses on agricultural commodities. The sample of natural rubber companies included tiremakers, tiremakers, and producers. The Group’s transparency and commitment towards improving the sustainability of the natural rubber value chain is evident in the ranking.

Michelin supports Sri Lankan natural rubber producers. Michelin is seeking its involvement through a three-year public/private project, co-financed by a grant from France’s Ministry of Economy and Finance. This project is designed to improve the skills of 6,000 farmers using a digital-enabled, innovative training model. This new initiative will be in operation by 2022 and reflects the Group’s ongoing support of local communities as they transition towards sustainable, mutually-beneficial social and environmental practices.

The Green Gold Bahia project Michelin Ecological Reserve Brazil: Michelin decided in 2021 that the reserve would be increased by 30% to 3,900ha from its initial 3,096 ha. This was to allow for growing wildlife populations in the most biodiversity-rich Atlantic Forests region. The ecosystem has been restored and wildlife populations have increased thanks to the eighteen-year-old programs that were implemented to save and restore one the most endangered forests in the world. More than 108,000 trees from 275 varieties have been planted in this region. Additionally, more than 2000 plant and animal species have been discovered, including 20 new species. Michelin plans on planting 40,000 trees over 10 years to create a high quality habitat for wildlife and to support the development of endangered species.

First-quarter 2022 highlights

January 7, 2022, Michelin launches the new MICHELIN Road 6/Road 6GT motorcycle tire. The new tire uses the latest technologies from Michelin’s R&D to offer a distinct experience in wet grip and tire longevity.

January 13, 2022 Michelin will continue to develop WISAMO the prototype wing sail system that will help reduce carbon emissions in maritime shipping. The innovative solution will be fitted to a Compagnie Maritime Nantaise – MN ro/ro container ship. It will operate two weekly rotations between Spain, the United Kingdom and Spain with a WISAMO wing sailing.

January 28, 2022: Michelin introduces new summer tires, the MICHELIN Pilot Sport 5 (and the MICHELIN Prima 4+). They can be used for longer distances and reduce mobility’s environmental impact thanks to their durability.

February 3, 2022, Michelin launches the MICHELIN City Extra commuter tires. These tires are available for scooters, step-throughs, and small motorcycles. Michelin is expanding its global market coverage by offering a wider range of sizes.

February 22, 2022 Michelin is Air France’s exclusive tire supplier for the next 10 years. It has been chosen, via its Michelin Editions subsidiary. To produce travel-related content, EnVols will use its new media platform, EnVols Media Platform.

February 23, 2022 – Michelin redesigns the MICHELIN EVOBIB tire in order to improve longevity, reduce soil compaction, and increase fuel economy. Michelin now offers a complete range for powerful tractors with this new addition.

March 7, 2022: Ferrari chooses Michelin to be its official tire supplier in the 296 GTB. The new fittings were created by Michelin’s innovation abilities and co-design work of Ferrari and Michelin teams.

March 10, 2022 – Michelin unveils its MICHELIN STARTCROSS 6 tire. This is the first MICHELIN Motocross tire to use MICHELIN Silica Technology, which provides superior long-lasting performance.

March 15, 2022 – The Michelin Group suspends all industrial operations in Russia and exports to Russia. Michelin is committed in helping to address the humanitarian needs for those affected by the conflict, both within Ukraine and internationally. The Michelin Corporate Foundation and its facilities located in Central Europe have provided funding to local humanitarian organizations and initiatives by the Red Cross/Red Crescent.

March 21, 2022 – Michelin launches the MICHELIN Power Cup premium range of road tires. Designed for racers, and optimized for demanding cyclists, this tire is perfect for soft mobility.

March 2022 Michelin will be participating with the French National Railways (SNCF), Milla Group, and the Railenium Technology Research Institute to develop a fully-electric shuttle. Flexy, the hybrid concept is known as Flexy. It can run on roads and rails. This will help to revitalize smaller transit lines throughout France.

March 22, 2022 Michelin announces the 2022 Michelin Guide France restaurant selection. The award celebrates 87 chefs’ environmentally responsible engagement and demonstrates its strategic focus to its All Sustainable commitment.

April 12, 2022. The California Energy Commission (CEC), has selected Symbio and Faurecia as the leading contributors to a zero-emission state-supported hydrogen mobility project.

The highlights of the first three months in 2022.
You can find them on the Michelin website. http://www.michelin.com/

Presentation and conference call

Analysts and investors will review the first quarter 2022 sales during an English presentation on Tuesday, April 26th 2022 at 6:30 PM CEST.

WEBCAST

The presentation will be live webcast on: www.michelin.com/en/finance.

CONFERENCE CALL

Please dial the following numbers starting at 6:20 CEST:

You can also view the presentation of financial information for three months ending March 31, 2022 (press release or presentation). http://www.michelin.com/enThis includes practical information regarding the conference call.

Investor calendar

• Annual Shareholders Meeting Friday, May 13, 2022

• Ex-dividend date: Tuesday, May 17, 2022

• Payment date:Thursday, May 19, 2022

• Results for the six-month ending June 30, 2022: Tuesday, July 26, 2022 at 3:00 p.m.

• Financial information for nine months ending September 30, 20,22: Tuesday, October 25, 20,22 after close to trading

• Michelin in Motion progress report (digital event):Tuesday, November 29, 2022

DISCLAIMER

This press release does not constitute an offer to buy or solicitation to recommend the purchase Michelin shares. Please refer to the French documents for more information on Michelin. Autorit des MarchsYou can also get financing from the www.michelin.com/eng website.
This press release could contain forward-looking statements. Although the Company believes these statements are based in reasonable assumptions at time of publication, they are still subject to change. There are risks and contingencies that could cause a discrepancy between the actual data and the forecasts or inferred from these statements.

1 Serious supply disruptions or restrictions on freedom to move that would cause a significant decline in tire markets
2 Structural Free Cash Flow refers to the free cash flow before acquisitions adjusted for the impact on raw material costs on trade payables and trade receivables.

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