Earnings fall sharply at Yokohama Rubber, despite better first half sales

Tokyo-The Yokohama Rubber Co., Ltd., said its net sales in the six months ended 30 Sept. rose by 10.5 percent over the same period of the previous year, to ¥222 400 million (€1471 million). Operating income declined 31.0 percent, to ¥3300 million (€21.8 million), and that net income declined 74.8 percent, to ¥3400 million.

Leading the sales growth were strong gains in tyre business in North America and in Asian nations besides Japan. Also contributing to the sales growth were increased shipments of tyres to automakers in Japan and business gains in Yokohama's Multiple Business (diversified products) Group, led by sales growth in high-pressure hoses, aircraft products, and marine hoses.

The decline in operating income resulted from rising prices for raw materials. Yokohama recorded a tax benefit in the first half of the previous fiscal year, and the absence of a corresponding gain in the first half of the present fiscal year amplified the decline in net income. Partially offsetting that decline was a special gain of ¥4200 million yen on sales of investment securities.

By business segment, sales increased 11.5 percent in Yokohama's Tire Group, to ¥162 500 millio. Operating income in the Tire Group declined 69.7 percent, to ¥1100 million, reflecting the rising prices for natural rubber and other raw materials. Sales increased 7.9 percent in the Multiple Business Group, to ¥60 000 millio, and operating income increased 2.3-fold, to ¥2500 millio. The increase in operating profitability resulted from sales growth and from improvements in the structure of earnings in aircraft products and in industrial products.

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Press release from Yokohama