Toyo Tire confirms full year targets despite third quarter setback

Tokyo – Toyo Tire Corp. has confirmed its full year financial targets amid growing raw material woes.

The Japanese group saw third quarter operating income decline 10% to Yen12.7 billion (€98 million), on flat sales of Yen96.4 billion, said a 12 Nov statement.

Toyo linked the decline in operating income mainly to the increasing raw materials prices, which had a 7% negative impact in the third quarter and was partially offset by a 5.8% improvement in price/mix.

Over the first nine months of the year, the group posted a strong 79.9% increase in operating income to Yen39.6 billion, on 14.6% higher sales of Yen283 billion.

During the third quarter, the tires business unit reported 1.4% increase in sales to Yen87 billion, while operating income fell 7.1% to Yen13.7 billion, due mainly to higher raw materials costs.

Over the nine-month period, the business unit posted a 71% increase in operating income to Yen41 billion, on 15% higher net sales of Yen254 billion.

The automotive parts business unit posted a 10.4% decline in sales to Yen9 billion over the third quarter, while operating loss increased to Yen558 million, from Yen383 million reported last year.

Over the nine-month period, the business unit posted net sales of Yen28.8 billion, up 10.4% compared to last year, while narrowing operating loss to Yen1.5 billion, from Yen2 billion last year. 

At this stage, Toyo confirmed its business outlook for the year, as announced in August. The group expects to deliver 14% year-on-year higher sales of Yen392 billion and increase operating profit by 32% to Yen48 billion.