Yokohama Rubber Co. has announced its financial results for the first half of fiscal 2017. Profit attributable to owners of parent increased 38.7% over the same period of the previous year, to 11.4 billion yen (approximately $103,979,400) on a 16.8% increase in operating income, to 18.4 billion yen (approximately $167,826,400), and a 15.9% increase in net sales, to 310.8 billion yen (approximately $2,827,510,000).
Earnings benefited from the sales increases, from price increases for tires that Yokohama instituted in Japan in April and subsequently, and from the weakening of the yen. Those positive factors more than offset the adverse earnings effect of an upward trend in raw material prices.
In Yokohama’s Tires segment, operating income increased 8.9%, to 13.1 billion yen (approximately $119,485,100), on a 6.4% increase in sales, to 221.5 billion yen (approximately $2,020,301,500). Business expanded strongly in the original equipment sector, led by continued growth in China and by growth in North America and in Russia. Business in the replacement sector increased in unit volume and in value.
Operating income in Yokohama’s MB segment declined 7.9%, to 3.2 billion yen ($29,187,200), on a 2.3% decline in sales, to 55.0 billion yen (approximately $501,655,000). Business in the MB segment benefited from recoveries in Chinese and domestic demand for high-pressure hoses for construction equipment and from growth in overseas sales of Hamatite-brand automotive sealants. Sales of industrial materials contracted despite overseas sales gains in conveyor belts as business shrank in marine products. Yokohama’s business in aircraft fixtures and components declined on account of weakness in the commercial sector.
In the ATG segment, operating income totaled 1.5 billion yen (approximately $13,681,500) on sales of 30.3 billion yen (approximately $273,630,000). Global weakness in grain prices weighed on demand for agricultural tires. The market exhibited signs of recovery, however, and sales in the ATG segment accorded with management’s expectations in the original equipment sector and in the replacement sector.
Management has revised upward the projection that it announced in February 2017 for full-year operating income. The revised projection calls for operating income of 50.0 billion yen ($456,050,000), a 5.3% increase over the earlier projection.