Yokohama Rubber Co. Ltd. posted net income of 2.9 billion yen on net sales of 123.1 billion yen for its first quarter ended June 30, 2008. Compared to the same period last year, net income was down 7.9%, while sales were up 1.3%.
Based on the exchange rate on June 30, 2008, Yokohama recorded 1Q net income of $27.3 million on net sales of $1.16 billion, an income-to-sales ratio of 2.3%.
The increase in sales was attributed to expansion in Yokohama's Tire Group, helped by gains in the original equipment market in Japan and the replacement market in emerging economies in Russia, Latin America and the Middle East. Sales increased 2.5% over the same period in fiscal 2008 (ended March 31, 2008) to 93 billion yen.
Improved profitability at Yokohama's production subsidiaries in Thailand, the Philippines, and China supplemented the Tire Group's earnings contribution.
Operating income declined 3.3%, to 4.1 billion yen, as the continuing rise in raw material costs and in logistics expenses more than offset the increase in net sales. However, the Tire Group's operating income increased 5.6%, to 3.2 billion yen.
Yokohama's management says it "abides by the full-year fiscal projections" that it announced in May, despite an unexpected weakening of the yen against the euro and United States dollar. Those projections, compared to fiscal year 2008, are:
* net income of 13 billion yen, a 38.3% decline;
* net sales of 565 billion yen, a 2.5% increase.
Comparative operating income is projected to decline 21.5% to 26 billion yen.
