TOKYO (Nov. 2, 2010)—Yokohama Rubber Co. Ltd. was back in the black in the first half, reporting $90 million in operating income on 17.9-percent higher sales of $2.59 billion. Net income for the period ended Sept. 30 was $13 million.
Leading Yokohama's business upturn was strong sales growth in tires, in high-pressure hoses and in sealants. That growth more than offset the adverse effect on earnings of rising prices for raw materials and the appreciation of the yen. Earnings further benefited from rises in capacity utilization rates and from Tokyo-based Yokohama's progress in cost-cutting programs, the company said.
Yokohama's tire operations increased sales 18.5 percent to $2 billion and interim operating income totaled $60 million, compared with an operating deficit last year. Business was especially robust in the U.S. and in China, notwithstanding the challenge posed by the strengthening yen. Yokohama also recorded sales growth in Japan, both in the original equipment market and in the replacement market.
Yokohama projects that net sales will increase 11.5 percent in the fiscal year and that operating income will increase 18.9 percent. The projection for operating income is 41.7 percent higher and that for net income 43.8 percent higher than the projections released by Yokohama on May 12. The heightened earnings expectations reflect progress in expanding sales volume and in trimming costs.