Tokai Rubber trebles income on 30 percent sales rise

ERJ staff report (DRR)

Komaki, Japan -- Tokai Rubber Industries, Ltd., Inc., the diversified rubber and polyurethane insulation systems supplier, has reported a trebling of its net income in the second quarter of its 2010-11 financial year, running 1 July to 30 Sept.

Income of Yen 3665 million (euro 32.1 million) in the quarter was more than three times the Yen 1101 million figure it recorded for the same period in 2009. Sales over the period also rose, but much less strongly, reaching Yen 65 378 million as against Yen 56 108 million in the prior year, a 5 Nov report from the company adds.

The results strongly boosted the firm's income for the first half of its financial year, from 1 April to 30 Sept, taking it to Yen7088 million, a strong rebound from the net loss of Yen 935 million in the same period last year, although sales showed a more modest rise, from Yen 100 126 million to Yen 129 872 million in the first half of the current year, according to results released.

At the end of its financial year on 31 March 2010, the firm recorded total sales of Yen 234 131 million and income of Yen 9314 million. Total employment in the firm also showed an increase over the first half of the present year, reaching 13 066 as against 12 442 in the same period of 2009.

Much of the improvement has been due to the significant increase in automobile production, Tokai explained, saying this has led to rising demand for products such as anti-vibration components, rubber hoses and automotive interior parts. Polyurethane insulation system sales also rose, it added.

As a result, its automotive supply business recorded sales of Yen 51 849 million, with its general industry supplies business accounting for the remaining Yen 13 529 million in the firm's second quarter, ended 30 Sept.

The firm commented that the world has been recovering strongly, led by domestic demand and expansion in emerging countries such as China and India, although Japan itself is only showing a gradual recovery, as a result of economic support measures such as tax breaks and subsidies. Public investment is sluggish, so the domestic Japanese business is still in a difficult situation, owing to factors such as slowing exports caused by the yen's appreciation.

These factors will influence the group's business environment, including uncertainty about the economic outlook for the yen's appreciation and rising raw material prices, Tokai's statement concluded.

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Press release from Takai (Japanese language)

Above press release auto-translated into English from Japanese/p>