Bridgestone Corp. has revised downward by about 40 percent its earnings forecast for fiscal 2002 and announced it is dropping Firestone out of the names of its holding companies in the Americas and Europe in order to ``build a strong, high performance corporate identity under the Bridgestone name.''
Bridgestone revised its earnings forecast downward by more than $240 million after announcing a $400 million capital infusion for its European activities, but added that Nashville, Tenn.-based Bridgestone/Firestone Americas Holding Inc. (BFAH) should report net income about 40 percent higher than projected earlier.
Based on the latest estimates, Bridgestone Corp. expects to report net income of $322 million on sales of more than $18 billion-or an earnings ratio of about 1.8 percent of sales.
In the Americas, BFAH's net income should rise to $70 million, while operating income and sales should hit the earlier projections of $190 million and $7.6 billion, respectively.
``Although the company's performance is not yet where we ultimately want it to be, the numbers clearly show that we've stabilized the business and our comeback is well ahead of schedule,'' said Mike Gorey, controller and vice president of BFAH.
``A lot of the credit goes to the hard work of our 51,000 employees and our loyal stores and dealers across the Americas.''
The firm's holding companies will be known starting Jan. 1 as Bridgestone Americas Holding Inc. and Bridgestone Europe N.V./S.A. The changes won't affect other operating units, such as Bridgestone/Firestone North American Tire L.L.C., the company said, and should allow the individual businesses ``to build strong brand identities for their products under, primarily, the Bridgestone and Firestone names.''
The name change comes just a year after Bridgestone announced the Bridgestone/Firestone Americas Holding Inc. corporate organization. John Lampe will continue to serve as chairman, president and CEO of the holding company, while Mark Emkes heads the North American tire unit as chairman, CEO and president.
The changes in Europe coincide with investments in expanding production in Poland and Spain and research activities in Italy, Bridgestone said.
In Poland, Bridgestone will increase daily capacity at its plant in Poznan to 23,000 tires from 15,000. The company said in August it was planning to invest $60 million in the Polish site to raise its capacity to 15,000 units.
In Spain, Bridgestone said it would raise daily output of truck and bus tires at its Bilbao plant by 1,100 units to 4,600 units by year-end 2005.
The group also will build a second proving ground in Rome as part of a plan to reinforce its European research and development activities. The new facility will include a Training and Communication Center for European staff, dealers and customers.
Additionally, Bridgestone said it will write down $300 million against the value of aging tire equipment at five of its six European manufacturing sites-Bethune, France; Bari, Italy; and Burgos, Bilbao and Puente San Miguel, Spain.