Nine-month net income for Yokohama Rubber improves 88.1%
Yokohama Rubber Co. Ltd. posted net income of 25.7 billion yen on net sales of 409.7 billion yen for the first three quarters of its fiscal 2008 ended Dec. 31, 2007. Compared to the same period of the previous fiscal year, net income was up 88.1%, while net sales were up 11.4%.
Based on the exchange rate on Dec. 31, 2007, Yokohama recorded net income of $230.6 million on net sales of nearly $3.7 billion for the first nine months of fiscal 2008, a 6.3% net income to net sales ratio.
According to Yokohama, net sales benefited from its Tire Group and Multiple Business (diversified products) Group more than offset "the adverse earnings impact of the persistent upward trend in raw material costs and of continuing increases in logistics costs and in other selling, general and administrative expenses."
Also contributing to the "surge" in profitability were the weakening of the yen and tax benefits associated with improved profitability in the company's North American operations. The company also noted improved profitability in Asian nations besides Japan.
While Yokohama's overall operating income increased 80.2% (to 30.8 billion yen), its Tire Group operating income nearly doubled, climbing 98.8% to 25.6 billion yen. The group's sales grew 13.1% to 312.5 billion yen.
"Prospects of further rises in raw material costs and the recent appreciation of the yen preclude easy optimism about the business outlook," says the company.
"Management at Yokohama, therefore, adheres to the full-year fiscal projections that it announced on Nov. 9, 2007. Those projections call for net income to rise 39.3%, to 22.8 billion yen, on increases of 51.9% in operating income, to 32 billion yen, and 8.6% in net sales, to 540 billion yen."