Yokohama’s bottom line hit in H1 2011

Although enjoying an 8.4 per cent increase in sales to 258.2 billion yen (£2.1 billion) in the six months to September 30, 2011, Yokohama Rubber experienced a decline in both operating and net income during this period. The company says rising raw material costs, an appreciating yen and an increase in selling, general and administrative expenses were chiefly responsible for the decline in operating income, which fell 8.3 per cent to 7.6 billion yen (£61.2 million) year-on-year between April 1 and September 30. These factors in turn led to net income falling 75.8 per cent to 294 million yen (£2.4 million). Yokohama notes however, that its actual operating income figure was 26.7 per cent higher than its earlier projection of 6.0 billion yen, the better result being achieved thanks to increased product selling prices and cost cutting measures.Net sales during the second quarter of the current financial year, between July 1 and September 30, 2011, increased 6.6 per cent to 128.8 billion yen (£1.0 billion). In this three month period operating income actually increased by 45.7 per cent, to 3.4 billion yen (£27.8 million), however second quarter net loss grew substantially year-on-year, from 222 million yen to 2.5 billion yen (£20.4 million).

Net sales during the second quarter of the current financial year, between July 1 and September 30, 2011, increased 6.6 per cent to 128.8 billion yen (£1.0 billion). In this three month period operating income actually increased by 45.7 per cent, to 3.4 billion yen (£27.8 million), however second quarter net loss grew substantially year-on-year, from 222 million yen to 2.5 billion yen (£20.4 million).

Tyre sales increased 10.7 per cent during the first half of the current financial year, to 204.7 billion yen (£1.7 billion), while operating income in the company’s tyre operations declined 2.0 per cent to 6.0 billion yen (£48.2 million) – the rising yen and appreciating raw material costs again the culprits for this negative result. Yokohama notes that it performed well in the domestic Japanese replacement market, reflecting growth in used vehicle sales, and this strong performance more than offset a decline in original equipment tyre sales that followed on from the March 2011 earthquake.