Yokohama's sales gains are offset by decline in income
Yokohama Rubber Co. Ltd. boosted its net sales some 10% to 367.8 billion yen for the first three quarters of its fiscal year, which ended Dec. 31. Sales for Yokohama's Tire Group grew 11.2% during that period to 276.4 billion yen. However, Yokohama struggled in the income department.
Overall, Yokohama's operating income declined 18.3% from the first three quarters of the previous fiscal year to 17 billion yen due to rising raw-material costs.
Net income fell 29.8% to 13.7 billion yen. "That decline reflects the decline in operating income and a tax benefit recorded in the same period of the previous year in connection with earlier write-downs of equity in a U.S. subsidiary," say Yokohama officials.
The Tire Group also saw an operating income decline of nearly 30% to 12.9 billion yen because of rising prices for natural rubber and for other raw materials.
Yokohama executives have raised their full-year fiscal projections that were originally announced on this past November.
They predict that net sales will rise 9.5% to 495 billion yen, .8% higher than in the earlier projection. Operating income is expected to decline 2% to 21.5 billion yen, 2.4% higher than originally anticipated. Meanwhile, net income will decline 25.4% to 16 billion yen, a 39% improvement on original projections.
"The yen appears likely to be weaker on average for the full year than management had assumed.
"In addition, the rise in prices for natural rubber and for other raw materials has subsided somewhat and appears likely to be smaller for the full year than management had assumed."