News Release

Yokohama Rubber's Fiscal 2008 First-Quarter Earnings More than Double on 14% Increase in Net Sales

Company raises projections for interim and full-year sales and earnings

The Yokohama Rubber Co., Ltd., posted a 150.2% increase in net income, to 3.1 billion yen, in the three months ended June 30―the first quarter of the present fiscal year. That increase is over the same period of the previous year, and it reflects increases of 130.6% in operating income, to 4.3 billion yen, and 13.8% in net sales, to 121.6 billion yen. Sales expanded solidly in Yokohama's Tire Group, led by growth in markets outside Japan, and in its Multiple Business (diversified products) Group.

Operating income in Yokohama's Tire Group tripled in the first quarter, to 3.1 billion yen, as sales increased 15.9%, to 90.7 billion yen. Leading the sales growth were gains in North America, Europe, and Asian nations besides Japan. The sales growth, coupled with the weakening of the yen and price hikes for Yokohama tires, more than offset the continuing upward trend in prices for natural rubber and other raw materials.

In the Multiple Business Group, operating income increased 14.3%, to 1.1 billion yen, as sales increased 8.1%, to 30.9 billion yen. Sales growth was especially robust in industrial products and in aircraft products, and Yokohama also posted sales gains in hoses and sporting goods.

The stronger-the-expected fiscal results in the first quarter have prompted Yokohama to raise its interim and full-year fiscal projections. Management now projects that net income will increase 123.1% in the six months to September 30, 2007, to 7.5 billion yen (projection announced on May 10, 2007: decline 34.5%, to 2.2 billion yen), on increases of 172.4% in operating income, to 9.0 billion yen (projection announced on May 10, 2007: increase 66.5%, to 5.5 billion yen), and 13.3% in net sales, to 252.0 billion yen (projection announced on May 10, 2007: increase 9.7%, to 244.0 billion yen). For the full year to March 31, 2008, management projects that net income will increase 39.3%, to 22.8 billion yen (projection announced on May 10, 2007: increase 6.9%, to 17.5 billion yen), on increases of 51.9% in operating income, to 32.0 billion yen (projection announced on May 10, 2007: increase 35.3%, to 28.5 billion yen), and 8.6% in net sales, to 540.0 billion yen (projection announced on May 10, 2007: increase 7.0%, to 532.0 billion yen).