Toyo Tire & Rubber Co. Ltd. recorded net income of nearly 9.1 billion yen on net sales of 96 billion yen for its first quarter ended March 31, 2014. That compares to income of 4.2 billion yen on sales of 83.5 billion yen for the same period last year.
Based on the exchange rate on March 31, 2014, Toyo posted net income of $88.3 million on net sales of $933.9 million for 1Q 2014. Its income-to-sales ratio was 9.4%.
Operating income for the quarter increased 86.7%, from nearly 6 billion yen to 11.1 billon yen ($108.2 million).
Sales for the tire business unit, which represent 78% of total sales, were up 16.2%, to 75.2 billion yen ($732 million). Operating income was up 98%, to 10 billion yen ($97.7 million).
Original equipment tires, Japan
Automobile production volume in Japan increased on rush demand in advance of the consumption tax hike, but due to a shift in production to car models not equipped with Toyo tires, unit sales and net sales declined compared with the same period the previous year.
Replacement tires, Japan
Unit sales and net sales increased compared with the same period the previous year as a result of strong sales of the Transpath series minivan tires released as new products and rush demand in advance of the consumption tax hike.
Replacement tires, overseas markets
In the North American market, unit sales and net sales increased as a result of strong sales of high-value-added SUV tires accompanying economic recovery.
In Europe, unit sales and net sales increased as a result of acquiring new customers in Russia and rebounding demand in Germany.
In China and Southeast Asia, unit sales and net sales also increased.
Toyo has revised its previously announced first-half projections upward due to an improved tire sales structure, a less-than-expected market deterioration, a decrease in raw material prices, and a weaker-than-expected yen. Toyo's first-half results will compare to 1H 2013 as follows: net income will increase 77.1%, to 16 billion yen; net sales will increase 11.5%, to 193 billion yen; and operating income will increase 66.6%, to 23 billion yen.