Sales, earnings fall at Yokohama in Q1

ERJ staff report (LMH)

Tokyo – The Yokohama Rubber Co. Ltd said sales fell in the first quarter ended 30 March by 5.6% from the same period in 2012 to ¥127.7 billion (€967 million) due to the weakening sales of tires in the Japanese original equipment market and in Yokohama’s principal markets overseas.

Operating income was down 18.1% to ¥7.6 billion, while net income fell by 35.7% to ¥5.6 billion.

In Yokohama’s tire operations, sales declined 6.6% from Q1 2012 to ¥100.1 billion, and operating income declined 27.6% to ¥5.7 billion. Yokohama noted that Japanese demand for original equipment tires declined following the end of government incentives for purchases of fuel saving, low emission vehicles. However, sales were basically unchanged in the Japanese market replacement tires. Tire demand was “generally sluggish” in North America, Europe and China also.

In the industrial products business, which includes high-pressure hoses, conveyor belts and anti-seismic products, sales fell 2.7% in Q1 from the same period in 2012 totalling ¥22.1 billion. However operating income increased 21.6% to ¥1.5 billion.

Yokohama said the decline in sales reflected weakening Japanese demand for construction, automotive and electronic sealants, but that it posted strong gains in overseas sales volume of automotive hoses, as well as gains in sales of marine fenders, marine hoses and conveyor belts.

Despite the decline in sales and earnings in the first quarter, Yokohama said its full-year predictions remain unchanged. It projects that net sales will rise 12.6% to ¥630 billion, operating income will rise 18.7% to ¥59 billion and net income will rise 10.4% to ¥36 billion.

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News release from Yokohama Rubber