Group Michelin is expecting its 2005 results to be on par with 2004 while Sumitomo Rubber Industries Ltd. saw double-digit improvements in operating and net income last year as sales grew 4.5 percent.
Sumitomo's operating profit in 2004 climbed 20.6 percent to $402.5 million and net income jumped 46.4 percent to $169.5 million as sales hit $4.16 billion. The profit gains improved the firm's earnings ratios by more than a full point each, to 9.7 and 4.1 percent, respectively.
The earnings gains were paced by the firm's industrial products and sports sectors, the former turning a $10 million loss into a $14.6 million profit and the latter improving 38.5 percent over 2003. Tire division operating income was up 5.4 percent to $290.9 million, while tire sales grew 5.2 percent to $3.15 billion.
During the year Sumitomo increased capital investments 23.2 percent to $343.1 million, including nearly $320 million for tires.
Sumitomo's sales in North America-which include sales by Falken Tire Corp. and Treadways Corp.'s Sumitomo Tire Division-grew 13.6 percent last year to $418 million.
Meanwhile, despite continuing double-digit growth in raw materials costs and a less-robust economy than last year, Michelin Chairman Edouard Michelin said he expects earnings this year to at least match those of 2004.
For 2004 Michelin reported a 13.7-percent increase in operating earnings to $1.61 billion, pushing the earnings/sales ratio up nearly a full point to 8.3 percent. Net income, including non-recurring items, jumped 60 percent to $654.7 million. Sales grew 2.1 percent to $19.5 billion.
``We look to 2005 with confidence as such momentum is built on our strengths,'' Mr. Michelin said. ``We will continue to progress further on all tire markets. We are targeting a level of operating result which is at least as good as that achieved in 2004 despite a more difficult environment, in particular because of additional strong raw material price increases.''