Tokyo - The Yokohama Rubber Co. (YRC) has reported a 50.1% year-on-year decline in first quarter business profit at Yen5.8 billion (€47 million) on 0.2% higher sales of Yen149.5 billion.
In the tires segment, sales revenue for the first three months of the year fell 3.9% to Yen100 billion, due in part to a decline in sales volumes, Yokohama reported 14 May.
Segment profit dropped 81.6% to Yen1.4 billion, due to lower volumes and an increase in production costs associated with reduced production.
Sales revenue fell both for original equipment tires and replacement tires in Japan and overseas.
That OE decline, said YRC, reflected the impact of product changeovers in Japan for multiple vehicle models equipped with Yokohama tires and a downturn in car production in China.
In the replacement market, the company attributed lower revenue to weak sales of winter tires associated with a warm winter in Japan.
In the multiple business (MB) segment, sales revenue and business profit increased overall, helped by strong revenue in high-pressure hoses and overseas sales in the automotive sector.
Segment profits rose 3.4% to Yen1.7 billion on 9.7% higher sales of Yen28.8 billion.
Demand for hoses, said YRC, was driven by continuing strength in Japanese demand in the construction equipment sector.
The company also posted sales growth in industrial materials, including conveyor belts, as well as Hamatite-brand sealants and adhesives.
ATG segment, which includes off-road, farm and industrial machinery tires, saw both profits and sales grow over the period.
Segment sales rose 11.6% to Yen18.8 billion, while profits climbed 28.3% to Yen2.4 billion during the first three months of the year.
The sales and earnings gains reflected growth in OE business in Europe and in replacement business worldwide, Yokohama explained.
Yokohama calculates business profit as sales revenue less the sum of cost of sales and selling, general and administrative expenses.