Kobe, Japan – Sumitomo Rubber Industries Ltd. reported double-digit gains in operating profits and sales for the quarter ended 31 March, as higher selling prices, increased volume and favourable currency exchanges offset increased raw materials costs.
Operating income increased 18.4% to $129.10 (€110 million) on 10.7% higher sales of $1.96 billion, raising the operating ratio slightly to 6.6%. Net income fell 10.5% to $70.6 million.
SRI attributed the income gain to the positive effects of price, volume and mix offsetting higher raw materials costs.
SRI's tire business reported 13.7% better operating income of $105.5 million on 9.5% higher sales of $1.67 billion.
By region, sales in Europe jumped 75.5% to $317 million, due in large part to the January 2017 acquisition of Micheldever Group, a holding company for Micheldever Tyre Services Ltd. (MTS), a wholesaler and retailer of tires in the UK.
MTS sells around six million tires per year — roughly equal to 20% of the UK market — and reported sales in 2016 of $400 million, SRI said at the time.
Sales in North America, by contrast, fell 9.5% to $298.6 million despite higher OE deliveries.