Toyo Tire & Rubber Co. Ltd. reported a net loss of 12.3 billion yen on net sales of 381.6 billion yen for its fiscal year ended Dec. 31, 2016. That compares to net income of 1.6 billion yen on net sales of 407.8 billion yen for fiscal 2015.
Based on the exchange rate for Dec. 31, 2016, Toyo recorded a loss of $108.3 million on sales of $3.4 billion for its fiscal 2016.
Operating income decreased 22.2%, and net sales decreased 6.4% compared 2015.
The company says net sales, operating income and ordinary income fell compared to 2015’s results due to a strong yen and responses to changes in market conditions. Toyo also posted an extraordinary loss related to replacing defective materials in earthquake shock absorbers. The company reported an extraordinary loss of 67.8 billion yen, of which 66.8 billion yen was related to the defective earthquake shock absorbers.
Tire business unit
Toyo’s tire business unit posted the following year-over-year results:
* net sales of 303.9 billion yen ($2.7 billion), down 6.7%; and
* operating income of 45.4 billion yen ($402 million), down 21.7%
Toyo says that in the U.S., unit sales exceeded that of 2015. The company attributed the gain in sales to adding Open County C/T and Country Q/T lineups to the Open Country series of light truck tires, as well as strong sales of the Open Country A/T II light truck line, the new Ridge Grappler large-diameter Nitto brand tire in the off-road category, and the Terra Grappler G2 light truck tire.
In Europe, unit sales grew through aggressive establishment and expansion of sales channels, according to Toyo. As a result, unit sales for the overseas market overall increased compared to the year-ago period, but net sales decline year-on-year due to a strong yen and other factors.
Toyo says the overseas economy in the coming year is expected to remain uncertain owed to factors including the direction of policies of U.S.'s new administration, Great Britain's exit from the EU, and slowing growth in China and other developing nations. Japan's economy also looks to remain on a gentle recovery.
In the tire segment, backed by expanded production capacity at Toyo Tire North America Manufacturing Inc., Toyo’s North American tire production subsidiary, the company says it will continue to expand products and sales of tires for light trucks.