TOKYO (June 25, 2010)—Bridgestone Corp. expects its half-year earnings to exceed earlier projections by as much as 37 percent, based on increased tire unit sales and improved tire pricing in markets outside of Japan.
The tire maker said it expects to report first half operating income of $701.6 million and net income of $412 million—improvements of 26 and 37 percent, respectively, over the projections released on May 7. Sales revenue should grow about 1.5 percent to $15.4 billion, based on double-digit growth in most tire segments in North America and Europe.
Tire production globally is forecast to jump 38 percent to 870,000 metric tons in the half and 25 percent for the full year to 1.78 million tons. Production in the Americas is seen rising 23 percent in the first half and 22 percent for the year.
Bridgestone also expects to report a dramatic turnaround for the fiscal year, nearly doubling operating income over fiscal 2009 to $1.45 billion. Sales are seen rising nearly 12 percent to about $32 billion. Net income is forecast at $857 million vs. barely above break-even last year.
The Tokyo-based company said it expects higher earnings despite rising raw materials costs because of higher unit sales and the corresponding improvement in the cost per unit because of increased production capacity usage rates.
In North America, Bridgestone anticipates first-half growth in all key sectors: replacement consumer tires up more than 10 percent; OE consumer tires up more than 60 percent; replacement commercial tires up less than 10 percent; OE commercial tires up more than 20 percent.
The full year forecasts are slightly less bullish, however, indicating a second-half slowdown, according to the tire maker.