TOKYO (Nov. 13, 2013) – Toyo Tire & Rubber Co. Ltd.'s operating income for the nine months ended Sept. 30 more than doubled, prompting Toyo management to increase the firm's earnings forecast for fiscal 2013 by 10 percent over previous forecasts.
At the same time, Toyo said it took a $123 million "extraordinary loss provision" in the third quarter to cover "potential future losses" related to a U.S. Department of Justice investigation into alleged violations of U.S. antitrust laws by Toyo's automotive parts business.
As a result, net income was adjusted to $64.7 million for the nine months.
The provision is Toyo's "current best estimate of all costs, expenses and fine amounts" that the company might incur by the conclusion of the investigation.
Regarding the operating income improvement of 158.6 percent to $259.8 million, Toyo said it is related to a declining yen and stable raw material prices. Sales rose to $2.82 billion, increasing the operating ratio five percentage points to 9.3 percent.
Toyo said its tire division's operating income tripled to $230.7 million on 15.4-percent better sales of $2.2 billion, based on strong sales of high-added-value products for SUVs in North American and solid unit sales and revenue in the European and Southeast Asian markets.
Operating earnings in North America jumped 88.8 percent to $68.3 million on 31.3-percent higher sales of $1.1 billion, Toyo said.