TOKYO—Yokohama Rubber Co. Ltd. (YRC) suffered a 44.6-percent drop in operating income for the six months ended June 30, despite nearly 29-percent higher sales.
Yokohama cited the adverse effects of the prolonged Russia-Ukraine war, the rising costs of raw materials and logistics and declines in unit production by auto makers globally for the earnings decline, to $219.1 million.
Sales revenue grew 28.8 percent to $3.18 billion, reflecting "robust growth" in overseas sales of tires, including off-highway tires for agricultural machinery and industrial machinery. The operating ratio fell nine points to 6.9 percent.
Despite the operating income decline, YRC has revised upward its full-year fiscal projections for 2022 sales and earnings that it announced in February. Yokohama now expects sales revenue of nearly $7 billion, up 14 percent over the earlier projection and 27.5 percent over fiscal 2021. Operating earnings are projected to end the year up over the earlier forecast but down nearly 28 percent versus 2021.
YRC's tire segment — which now combines the firm's traditional tire and off-highway tire businesses — reported double-digit gains in first-half sales revenue and business profits.
The tire business unit reported 15-percent better segment business profit of $214.5 on 31.6-percent higher revenue, based on sales gains in both the original equipment and replacement markets both domestically and internationally.