Tokyo--The Yokohama Rubber Co., Ltd., announced today that its sales and earnings increased in the first three quarters of the present fiscal year, the nine months ended December 31, 2010. Net sales increased 13.5% over the same period of the previous fiscal year, to 390.4 billion yen; operating income increased 52.2%, to 26.3 billion yen; and net income increased 25.2%, to 11.3 billion yen.
Yokohama posted sales gains in tires and in high-pressure hoses, sealants, and other diversified products. The sales growth more than compensated for the adverse effect on earnings of rising prices for raw materials and the appreciation of the yen. Also contributing to improved profitability were a rise in capacity utilization rates and progress in trimming costs.
In Yokohama's tire operations, sales increased 13.7%, to 310.2 billion yen, and operating income rose 37.4%, to 23.2 billion yen. The sales growth comprised gains in Japan and overseas, which more than offset the adverse effect on profitability of rising raw material prices and the strengthening yen. Business in Japan benefited from a general upturn in tire demand. That upturn reflected a rebound from curtailed purchasing amid economic weakness. It also reflected strong demand for winter tires occasioned by heavy snowfall. Yokohama made the most of the upturn in demand with successful product launches. Its new-product offerings in Japan centered on fuel-saving summer and winter tires that proved highly popular. The company also achieved sales growth in overseas markets, most notably in the United States and in China.
Sales in Yokohama's industrial products operations increased 18.2%, to 62.4 billion, and operating income rose 36.1-fold, to 2.1 billion yen. Business in those operations centers on high-pressure hoses, sealants and adhesives, conveyor belts, anti-seismic rubber-and-steel fittings for structures, marine hoses, and marine fenders. Leading the sales growth were strong gains in high-pressure hoses for construction equipment and in automotive window sealants.
In other products, sales declined 2.9%, to 17.9 billion yen, and operating income rose 2.8-fold, to 1.1 billion yen. Yokohama's business in this category centers on aircraft products and golf products. The company posted sales growth in replacement lavatory modules for commercial airliners. That growth and progress in trimming costs more than offset the adverse effect on profitability of a sales decline in golf products.