KOBE, Japan—Sumitomo Rubber Industries Ltd. (SRI) suffered an operating loss of $12.3 million in the quarter ended June 30, which contributed to a 56-percent drop in operating income for the half year.
The second quarter operating loss came despite 16-percent higher sales of $2.02 billion. Sales for the first half were up 16.4 percent over the same period in 2021 at $4.16 billion, while the operating profit was 56 percent below the 2021 result, yielding an operating ratio of 2.5 percent, down four full points from 2021.
Sumitomo cited growing inflationary pressures, restrictions on economic activities in China and the negative effects of the war in Ukraine and the lingering impact of the COVID-19 pandemic for the second quarter operating loss.
Based on the first half performance and expected second-half headwinds, SRI downgraded its full fiscal year earnings forecast by nearly a third to roughly $228 million, which would be a 43-percent drop from the fiscal 2021 result. Sales are projected to be slightly above earlier forecasts, but if achieved would be 22 percent above the fiscal 2021 figure.