Sumitomo posts 2001 loss; initiates cost-containment program

KOBE, Japan (June 18)—Sumitomo Rubber Industries Ltd. fell $59.3 million into the red in fiscal 2001 due primarily to several one-time extraordinary losses. Operating income was off 11.2 percent, to $185.6 million, as sales rose 2.6 percent to $3.57 billion. To help the company return to the black, Sumitomo plans to enact a two-pronged plan of action designed to cut costs and raise profitability, according to President Mitsuaki Asai's letter to shareholders in the 2001 annual report. Specifically, the company hopes to generate more than $55 million in additional profits by cutting manufacturing costs, restraining capital investments by up to 25 percent and reducing personnel and other costs by about 3 percent. Tire division sales rose 5.1 percent last year, to $2.6 billion, as business improved in the Japanese replacement and original equipment markets and in exports, the company said. Sales of Goodyear-brand tires in Japan by the firm's Dunlop Goodyear Tires Ltd. venture with Goodyear posted double-digit gains.