KOBE, Japan (Feb. 17, 2010)—Sumitomo Rubber Industries Ltd. reported a 12-percent rise in operating profits for the year ended Dec. 31 despite a 12.8-percent drop in sales.
The divergent result —operating income up to $307 million and sales down to $5.6 billion—boosted SRI's operating ratio more than full percentage point to 5.5 percent.
Net income was up ninefold to $97.1 million.
Sumitomo did not comment on the results, which benefited from a relatively strong fourth quarter. Operating earnings in the quarter climbed 153.4 percent while sales slipped just 0.2 percent.
SRI's tire division reported a 42.1-percent jump in operating profits for the year to $240.5 million on 13.5-percent lower sales of $4.63 billion, boosting the operating ratio two full points to 5.2 percent.
Sales in North America—where the firm's Sumitomo- and Falken-brand tires are sold by Treadways Corp.'s Sumitomo Division and by Falken Tire Corp., respectively—were off 12 percent to $796.3 million, the recently released figures show.
Capital expenditures for the tire division fell 39.5 percent to $320.8 million.