SRI reports five-fold jump in profits

Kobe, Japan – Sumitomo Rubber Industries (SRI) has seen a five-fold jump in operating profit in the first three months of the year, due mainly to a strong rebound within its tires business.

First quarter operating profit rose 466.1% year-on-year to Yen15.5 billion (€116.5 million) on 12% higher sales of Yen213.7 billion, SRI reported 12 May.

Sumitomo’s tire business poasted a revenue increase of 10.5% to ¥180,305 million, while business profit was up 459.4% at ¥13,146 million.

While a semiconductors shortage and Fukushima’s offshore earthquake impacted domestic OE demand, SRI said sales of replacement tires in Japan was lifted due to an increase in demand for winter tires and fuel-efficient tires.

In the overseas OE market, while the impact of the global shortage of semiconductors has emerged, some regions have shown signs of recovery from the impact of Covid-19, said SRI.

In the overseas replacement market, sales increased in the Asia and Oceania region, mainly in China, where the economy showed some recovery. 

Similarly, SRI said that it is expanding sales in Europe and Africa as well as the Americas, in areas where market conditions are recovering.

SRI’s sports business also reported a significant boost in profits, as it recorded a Yen1.4 billion business profit, against the loss of Yen387 million last year.

The unit reported a 34.4% jump in sales, helped by a “reversal of market contractions” in the golf goods market in Japan and North America.

In the industrial and other products segment, Sumitomo Rubber recorded a 2% drop in sales to Yen10 billion, while business profit decreased 35% to Yen576 million.

Here, SRI said higher rubber gloves sales failed to offset the decline in orders for infrastructure-based products and vibration control dampers.