Toyo Quarterly Results Marred by ‘Compliance Reporting Issue’
Toyo Tire & Rubber has announced its consolidated business results for the interim period of April 1, 2007 to September 30, 2007. Compared with the same period of the previous year, net sales increased by 24,017 million yen (£104.28 million) to 169,778 million yen (£737.11 million), an increase of 16.5 per cent. Operating income increased by 1,155 million yen (£5.01 million) to 7,086 million yen (£30.76 million, up 19.5 per cent, and ordinary income increased by 1,790 million yen (£7.77 million) to 6,194 million yen (£26.89 million, an increase of 40.6 per cent.
The company has also disclosed what it calls a “compliance reporting issue” discovered at its industrial products division involving urethane-based heat-resistant building construction materials, and initial estimates into the cost of replacing the subject materials stand at approximately 4,035 million yen (£17.52 million), therefore net income for the current interim period will decrease by 7,959 million yen (£34/56 million) to 637 million yen (£2.77 million), a sizeable 92.6 per cent drop.
Compared to the same period of fiscal 2006, net sales within the tyre segment increased by 23,056 million yen (£100.10 million) to 120,048 million yen (£521.20 million), a rise of 23.8 per cent, and operating income increased by 1,762 million yen (£7.65 million) to 6,988 million yen (£30.34 million), up 33.7 per cent.
Sales of original equipment tyres and replacement tyres for the domestic market, despite the effects of lower production volumes of car models equipped with Toyo’s products, managed to maintain the same levels as those achieved in the first half of fiscal 2006, thanks to increased sales of high-value-added products. Meanwhile, the volume of overseas sales, centring mainly on the North American and European markets, surpassed the levels achieved in the same period of the previous fiscal year. Together with the continued trend of a weak yen, net sales exceeded the levels recorded for the same period a year earlier.