TOKYO (Nov. 10, 2011)—Yokohama Rubber Co. Ltd. suffered an 8.3-percent drop in operating income in the six months ended Sept. 30 on the effects of rising raw materials costs, an appreciating yen and increased selling, general and administrative expenses.
Despite the drop, Yokohama said operating income of $99.2 million, or 2.9 percent of sales, was nearly 27 percent higher than its earlier projection, based on increases in selling prices and progress in trimming costs.
Net income plunged 75.7 percent to $3.8 million on currency translation adjustments and a nonrecurring loss in connection with severance payments at a subsidiary.
Sales for the period grew 8.4 percent to $3.37 billion, based largely on a surge in tire business, led by strong sales in Japan's replacement market.
Tire unit operating income fell 2 percent to $78.3 million, or 2.9 percent of the unit's sales of $2.67 billion. Higher aftermarket sales in Japan and improved sales in Europe and Asia more than offset lower OE sales in Japan, the company said.
Yokohama's industrial products businesses suffered a 71.2-percent drop in operating earnings while posting sales growth of 0.7 percent.
Sales in North America dropped 6.7 percent to $343.5 million. Operating earnings slipped 17.8 percent to $19.2 million, or 5.6 percent of sales.