Sales Up but Net Profit down at Sumitomo Rubber

Sumitomo Rubber Group has released interim results for the financial year ended December 31, 2007. The Group as a whole generated sales of 567,306 million yen (£2.68 billion) during 2007, up from 534,086 million yen (£2.52 billion) the previous year. The bulk of these sales came from the company’s SRI Tire Trading division, which recorded 474,282 million yen (£2,24 billion) in sales last year, an increase from 430,630 million yen (£2.04 billion) in 2006.

Operating income for the Group and the tyre division both also developed positively in 2006. A total operating income of 45,126 million yen (£213.5 million) was reported, as opposed to 36,789 million yen (£174 million) a year earlier. Operating income from tyres was 35,892 million yen (£169.8 million) in 2007; in 2006 this figure was 26,381 million yen (£124.8 million).

Despite this upward trend, net income for the Group decreased. In 2007 total net income was reported to be 19,498 million yen (£92.2 million), 29.3 per cent less than the previous year’s 27,585 million yen (£130.5 million). The company has not commented on net sales for the tyre division, however it reports that Group liabilities, both current and long term, increased by just under 10 per cent during the 2007 financial year. Capital expenditure also rose, particularly in the tyre division, from 44,937 million yen (£212.6 million) in 2006 to 51,577 million yen (£244 million).

European sales were 14.9 per cent down during the last year, to 26,790 million yen (£126.7 million). These sales account for just 4.7 per cent of Sumitomo’s global sales – the previous year Europe generated 5.9 per cent of sales.