Mathieu Rosemain
Bloomberg News

To offset foreign currency exchange shortfalls, global tire company Michelin said it will further tighten control over costs.

Michelin said it still sees global volumes steady as car, truck and specialty tires markets worldwide all advanced over the first nine months of the year.

“In light of the outlook for volume growth in the fourth quarter, Michelin confidently maintains its full-year objective of stable volumes,” the company said Monday in a financial statement.

Michelin laid out a strategy on Sept. 18 to deliver 1 billion euros in structural free cash flow a year by 2020, as well as at least a 15 percent return on capital employed.

The company expects its expansion outside Europe to ease foreign-exchange risks over time, as costs and revenues in various currencies are more balanced.

But the company blamed currency exchange after its third-quarter revenue dropped.

Sales fell to 5.12 billion euros ($7.06 billion) from 5.44 billion euros a year earlier, even as delivery volumes rose 2 percent, the company said.

That missed the 5.33 billion-euro average of five analyst estimates compiled by Bloomberg. The tire maker forecast that operating profit will rise by about 150 million euros before one-time items and currency effects, which will be “more deeply negative” than anticipated at the beginning of the year.

The depreciation of the U.S. dollar and the Japanese yen has undone the French manufacturer’s efforts to boost volumes by growing outside Europe, where demand has been hit by a recession-like economy.

The company is investing in additional capacity in new markets and by selling tires for mining equipment and other large vehicles. Europe’s contraction has already prompted the tire maker to look at ways to trim costs in the region, where about 59 percent of its 107,000 workers are employed.

Michelin shares have gained about 7 percent this year, valuing the company at 14.4 billion euros.

Michelin expects foreign-exchange fluctuations to burden full-year operating profit by about 250 million euros, Chief Financial Officer Marc Henry said on a conference call. The company previously forecast a negative currency impact of as much as 150 million euros for 2013. Nine-month revenue declined 5.3 percent to 15.3 billion euros.