Sumitomo Rubber profits fall 61% amid ‘persisting stagnation’
16 Nov 2022
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Tire business see 85% decline in profits while sports unit reports growing demand
Kobe, Japan – Sumitomo Rubber Industries has reported a sharp decline in business profit over the first nine months of the year, as the war in Ukraine, Covid lockdowns, high costs and a general slowdown in economy continued to pressure margins.
During the nine months to 30 Sept, the Japanese tire & rubber group reported a 61.4% decline in business profit to Yen32 billion (€220 million), on 19% higher sales of Yen657 billion, said Sumitomo Rubber in a 9 Nov quarterly results.
Over the first nine months, said SRI, the rise in inflationary pressures led to “a persisting sense of economic stagnation.”
In addition, the business continued to be affected by a decline in automotive production due to the shortage of semiconductors as well as the impact of soaring freight costs.
The rising prices of raw materials also continued, albeit appearing to be “somewhat easing”, SRI added.
Breaking down the results, Sumitomo Rubber said its Tire segment reported an 85% year-on-year decline in business profit to Yen3.4 billion during the nine-month period, on nearly 20% higher sales of Yen661 billion.
The Sports business, which includes tennis, golf and wellness segments, saw a rise in both revenue and business profit, as demand grew across all businesses.
The unit reported a 15.3% rise in profit to Yen8.2 billion, on 18% higher sales of Yen89 billion.
The Industrial unit, which includes rubber gloves and other industrial products, reported a 65% year-on-year decrease in business profit to Yen548 million, on 4.4% higher sales of Yen30 billion.
Here, SRI said, sales of disposable rubber gloves declined in Japan, but orders received for rubber parts for medical applications and office equipment increased.
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