Bridgestone's sales rise 13 percent in fiscal 2007, but could drop in 2008 due to high raw material prices

ERJ staff report (SS)

Tokyo -- Bridgestone Corp. has reported consolidated sales of ¥339 0200 million (Euro 21 433 million) from ¥299 1200 million for the 12 months ending 31 Dec 2007, an increase of 13 percent over the previous year.

The company, which also reported growth in its net income to ¥13 1600 million from ¥85 100 million, said that its improved results were partly due to the exchange gain on the weaker Japanese yen.

Bridgestone said, in a 19 Dec statement, that its operating income increased to ¥249 900 million from ¥190 800 million and ordinary income increased to ¥219 000 million from ¥159 500 million, as a result of the company's efforts to mitigate the impact of increasing raw material costs.

Sales in both of the company's business segments -- Tyres and Diversified Products -- showed improvement, with the tyre segment reporting sales of ¥275 5900 million, from ¥239 6900 million and the Diversified Products business unit ¥656 300 million compared to ¥626 800 million in the 12 months ending 31 Dec 2006.

Unit sales of strategic products, led by UHP (ultrahigh performance) tyres, increased considerably over the previous year, whilst sales of truck and bus tyres decreased, due to the expected impact of reduced sales in the original equipment sector as a result of pre-buy activities in 2006 in response to new emission regulations which took effect in 2007.

In the speciality tyres business unit, sales of large and ultra-large off-the-road radial tyres, greatly exceeded the previous year on the back of continued strong demand.

Japan accounted for the largest percentage of sales, with sales in the region rising to ¥137 1700 million from ¥125 5600 million.

In the Americas, sales increased to ¥151 0700 million from ¥33 3500 million, whereas sales in Europe rose to ¥516 000 million compared to ¥418 400 million in 2006, due to an increase in unit sales coupled with the exchange gain on the weaker Japanese yen.

In other regions, sales grew to ¥548 600 million from ¥441 200 million, spurred by vigorous marketing activities, efforts to improve and expand production sites in strategic areas, and the exchange gain on the weaker Japanese yen.

Operating costs in all regions showed improvement, despite the effects of rising raw material prices.

Bridgestone said that it expects the operating environment to remain challenging in 2008, as a result of rising raw material and energy costs, and therefore predicts that 2008 results could suffer.

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Results from Bridgestone