OSAKA, Japan (Feb. 4, 2011)—Toyo Tire & Rubber Co. Ltd.'s net income more than doubled in the quarter ended Dec. 31, but operating income dropped nearly 16 percent and revenue fell 5.8 percent to $1 billion on lower sales in all of the company's regions.
Net income for the three months rose 172.2 percent to $49.7 million, but operating earnings fell to $77.3 million, or 7.7 percent of sales, the company reported.
Toyo's tire business segment suffered a drop in operating income during the quarter of 18.9 percent to $65.5 million as sales sank 7.9 percent to $755.7 million.
Despite the earnings and sales drops in the quarter, Toyo reported solid gains in sales and earnings for the first nine months of fiscal 2011.
Net income for the April 1 to Dec. 31 period shot up more than 100-fold to $58.6 million as sales rose 4 percent to $2.61 billion. Operating income rose 65.3 percent to $120.8 million, or 4.6 percent of sales.
Toyo said increased sales and capacity variance were enough to overcome increased raw material purchase costs and exchange rate impact on its way to improved income for the nine months.
The tire segment reported 45.4-percent higher operating income of $91.3 million for the first three quarters as sales edged up 1.7 percent to $1.92 billion.
Toyo said it boosted unit sales in Europe and Asia, including Japan, but unit sales in North America were on par with 2009. Revenue increased, though, on higher selling prices and a shift to higher value-added performance tires in many markets.
Toyo's businesses in North America reported nearly 10-percent higher revenue of $821 million for the nine months despite a sales drop of 1.2 percent in the quarter. Operating income rose nearly 30 percent to $37 million despite a 26-percent rollback in the quarter.
Toyo left its forecast for the fiscal year ending March 31 unchanged from projections it released in November.