Yokohama Rubber posts "record" sales, earnings at Q3 stage

Hiratsuka, Japan — Yokohama Rubber Co. (YRC) on 10 Nov reported "record" sales and earnings for the first nine months of the year.

For the nine months to end of September, YRC posted a 6.7% year-on-year increase in business profit to Yen49.2 billion (€303 million), on 12.5% higher sales of Yen693 billion.

For the third quarter ended 30 Sept, the Japanese group reported business profit up 28.6% year-on-year to Yen23.6 billion on 11.2% higher sales of Yen249.3 billion.

As a result, YRC raised its full-year projections issued in May, with business profit now pegged to come in at Yen90.0 billion.

That figure is 6.5% higher than the previously issued forecast of Yen84.5 billion, and up from Yen70 billion reported last year.

The tire & rubber products group has maintained its revenue forecast of Yen1,000 billion, up 16% on the Yen860 billion reported in 2022.

Tire sales

Breaking down the segments, YRC said its Tires unit – consisting of ‘tires' and Yokohama Off-Highway Tires (YOHT) - increased sales by 13.6% year-on-year to Yen613 billion.

The increase over the first nine months reflected 6.6% growth in the ‘tires’ business to Yen447.0 billion, primarily on strong revenue from OE strong sales in Japan and in North America.

Gains in these regions “more than offset” the adverse effects of weak business for Japanese OEMs in China, the statement noted.

YRC's replacement tire revenues also improved, with business in Japan benefitting from “early-year snowfalls” and higher demand in China and other Asian markets.

For the third quarter, YRC 'tires' sales came in 1.3% lower year-on-year at Yen155.2 billion, while business profit was down 55.5% year-on-year, to Yen 18.3 billion.

Off-highway business

The group posted an increase in sales revenue in off-highway tires for agricultural machinery, industrial machinery, and other applications.

However, the overall sales increase in off-highway tires reflected the acquisition in May of Trelleborg Wheel Systems Holding AB.

Now operating as Y-TWS, the unit acquired from Trelleborg AB contributed Yen36.8 billion to YRC's third quarter sales. 

Sales at YRC's legacy YOHT business, declined 17.9% year-on-year to Yen98.6 billion over the first nine months of 2023.

Business profit at YOHT, meanwhile, dipped 32.5% year-on-year to Yen 12.0 billion, YRC noting adverse market conditions in Europe and in North America. 

In the third quarter, legacy YOHT sales fell 23.2% year-on-year to Yen31.5 billion, with business profit down 37.4% year-on-year to Yen3.6 billion.

Non-tire sales

Over the first nine months, YRC’s non-tire ‘multiple business’ segment reported a 152% rise in business profit to Yen4.4 billion, on 6.3% higher sales of Yen73 billion.

For the third quarter, segment sales increased 1.9% year-on-year to Yen23.9 billion, while business profit spiked 124.7% to Yen1.6 billion.

YRC linked the gains over the first three quarters to higher sales in hoses and couplings, despite the operations being impacted by an automotive strike in the US.

The operations, YRC noted, expanded business with Japanese car makers, which “more than offset” the US “setback”.

Revenue also increased in industrial materials, with “strong sales gains” in conveyor belts in Japan and overseas, as well as in marine products and aircraft fixtures.