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Toyo performs well on the tire side despite decrease in 3Q net income

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Toyo Tire & Rubber Co. Ltd. recorded net income of 6.9 billion yen on net sales of 272 billion yen for the first three quarters of fiscal 2007 ended Dec. 31, 2007. That compares to income of 8.5 billion yen on sles of 240.8 billion yen for the same period a year ago.

Based on the year-end exchange rate, Toyo posted net income of $62.3 million on net sales of $2.4 billion for the first three quarters.

While comparative net sales were up 13% and operating income was up 55.6%, net income was down 18.9% The decrease was "due to the fact that expenses expected to be incurred for repair work and other measures related to the urethane-based heat-resistant building construction materials business have been recorded as a special loss," according to the company. As a percentage of sales, the company's net income decreased from 3.5% to 2.5%.

Here are the results by geographic segment (geographic segmentation of countries and regions is based on geographical proximity, according to the company).

Japan: net sales, 210.6 billion yen; operating income, 7.9 billion yen.

North America: net sales, 87.7 billion yen; operating income, 4.1 billion yen.

Other: net sales, 41 billion yen; operating income, 1.3 billion yen.

(Net sales do not include inter-segmental transactions and transfers.)

Net sales were up 17.4% (to 194.2 billion yen) in the tire business segment, which represented 71.4% of Toyo's total sales. Operating income in the tire segment was up 65.9% to 12.3 billion yen.

* Sales of original equipment tires for the domestic market grew over the same period of fiscal year 2006 "due to expanded sales of products of high added value."

* Sales of replacement tires for the domestic market fell below the fiscal year 2006 level, "due to sluggish demand, especially for studless tires."

Toyo says overseas tire sales for the first three quarters "significantly exceeded" sales for the same period of fiscal year 2006, "thanks to considerable growth in sales and a steadily weakening yen."

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