MUSCATINE, IOWA — Bandag Inc. reported consolidated net sales for fourth quarter of 2006 of $253.7 million, compared to consolidated net sales of $252.3 million in the fourth quarter of 2005, an increase of 1 percent.

But, the company’s North American business unit volume decreased 12 percent, compared to the fourth quarter of 2005, and net sales decreased 8 percent.

Consolidated earnings from operations were $11.2 million, or 57 cents per diluted share, for the fourth quarter of 2006, compared to fourth quarter 2005 consolidated net earnings of $12.1 million, or 62 cents per diluted share, Bandag stated.

For the full year of 2006, Bandag reported consolidated net sales of $973.6 million, an increase of 6 percent from consolidated net sales in 2005 of $914.6 million. Consolidated earnings from operations for 2006 were $36.6 million, or $1.87 per diluted share, compared to consolidated net earnings of $49.5 million, or $2.52 per diluted share, in 2005.

“The combined effects of the buildup of new trucking equipment capacity, ongoing uncertainty in energy and raw material prices and continued slow freight volumes, particularly early in the fourth quarter, suppressed unit and sales volume in Bandag’s traditional retread business,” said Martin Carver, Bandag chairman, president and CEO. “Both Tire Distribution Systems Inc. (TDS), Bandag’s tire distribution subsidiary, and our Vehicle Services business unit, which includes Speedco’s on-highway truck lubrication business, delivered solid sales improvements. In Bandag’s traditional businesses, our 2006 business simplification efforts set the stage to contain operating costs and help counter generally slow growth in trucking freight volumes, particularly in North America.”