KOBE, Japan— Sumitomo Rubber Industries Ltd. reported double-digit gains in operating profits and sales for the quarter ended March 31, as higher selling prices, increased volume and favorable currency exchanges offset increased raw materials costs.
Operating income increased 18.4 percent to $129.1 million on 10.7 percent higher sales of $1.96 billion, raising the operating ratio slightly to 6.6 percent. Net income fell 10.5 percent to $70.6 million.
SRI attributed the income gain to the positive effects of price, volume and mix offsetting higher raw materials costs.
SRI's tire business reported 13.7 percent better operating income of $105.5 million on 9.5 percent higher sales of $1.67 billion.
By region, sales in Europe jumped 75.5 percent to $317 million, due in large part to the January 2017 acquisition of Micheldever Group, a holding company for Micheldever Tyre Services Ltd., a wholesaler and retailer of tires in the United Kingdom. MTS sells around 6 million tires per year—roughly equal to 20 percent of the U.K. market—and reported sales in 2016 of $400 million, SRI said at the time.
Sales in North America, by contrast, fell 9.5 percent to $298.6 million despite higher OE deliveries.