Bridgestone Corp., helped in large part by the return to profitability by its Bridgestone/Firestone operations in the Americas, reported a 161-percent jump in net earnings on a 5-percent increase in sales in fiscal 2002.
For 2003, the company is predicting a 50-plus percent gain in net income on flat sales.
The upbeat report bore out what BFS Chairman and CEO John Lampe told dealers last May at the company's Bizcon 6 commercial meeting, when he predicted the tire maker was bouncing back to profitability and would finish the year in the black after a couple tough years.
Bridgestone Americas Holding Inc., the combined Bridgestone/Firestone operating units in North and South America, reported net income of $83 million last year vs. a $1.67 billion loss in 2001. Sales increased 7 percent last year, Bridgestone said, to $7.88 billion, while the operating result was $148.5 million in the black, reversing a loss from a year ago.
Bridgestone Corp.'s net earnings hit $362.5 million on sales of $18 billion-an earnings ratio of 2 percent-while operating income doubled to $1.18 billion, the company said.
The improved results in the Americas reflect a 30-percent increase in the sales of Bridgestone-brand tires and a stabilization of the Firestone brand, which experienced strong sales increases in the second half of the year, the company said. Gains also were realized because of improved efficiencies, reduced costs and improved profit margins. In addition, Bridgestone made a capital infusion of $1.3 billion in January 2002.
Bridgestone said its BFS Retail and Commercial Operations L.L.C., which oversees more than 2,200 company-owned tire and service centers, posted record service sales and profits for 2002. The company also credited its strong relationships with its more than 12,000 retailers throughout the Americas who sell its Bridgestone, Firestone, Dayton and associate brand tires.
``While we're not where we need to be, these results show we are on the right track in our turnaround plan,'' said Mike Gorey, controller and vice president of the Americas holding company.
``Our 51,000 employees in the Americas deserve a lot of credit for their hard work, but the job isn't finished. We still face real challenges to keep the positive momentum going,'' Mr. Gorey added.
For 2003, Bridgestone/Firestone said it faces rising fuel and raw materials costs, pressures on pension plan funding caused by a turbulent stock market and skyrocketing health insurance costs. But BFS nonetheless forecasts increased unit sales.
``There are some storm clouds on the horizon, but we believe we have taken these factors into account in our planning and expect to make a modest profit in 2003,'' Mr. Gorey concluded.
Bridgestone said its efforts at gaining business with large fleet operators is paying dividends in increased truck and bus tire sales.
Elsewhere, Bridgestone's sales in Europe increased 11 percent, to $1.94 billion, on particularly strong sales in the commercial vehicle tire segment. Operating earnings were up 83 percent to $66 million.