HIRATSUKA, Japan — Yokohama Rubber Co. Ltd. (YRC) reported double-digit gains in sales and earnings for the quarter ended Sept. 30, with the newly incorporated Trelleborg Wheel System assets accounting entirely for the increases.
Business profit jumped 28.6% in the quarter to $163.3 million on 11.2% higher revenue of $1.73 billion, yielding an improved operating ratio of 9.5%.
The tire business unit generated $150.9 million in business profit during the quarter (up 24.8%) on 12.8% higher sales revenue of $1.55 billion.
The Trelleborg Wheel business — now operating as Yokohama-TWS — accounted completely for the jump in Yokohama's tire business revenue, as YRC's "legacy" tire activities registered sales declines in both the mainstream (consumer and commercial) and off-highway tire sectors.
Yokohama-TWS contributed $255 million in revenue for the quarter, offsetting sales declines in the traditional (down 1.3%) and OHT businesses (down 23.2%).
YRC attributed these declines to weak business with Japanese auto makers in China and "adverse market" conditions in Europe and North America in the off-highway sectors. On the plus side, YRC reported strong OE sales in Japan and North America as well as vigorous replacement market sales in Japan due to early-season snowfalls.
In North America, YRC said its sales increased in the U.S. consumer replacement tire market but trailed overall industrywide growth. By contrast, YRC said its sales of replacement market truck/bus tires outpaced the industrywide trend, growing 3% over the 2022 quarter while industrywide shipments fell nearly 14% short of the year-ago period.
For the nine-month period, YRC reported a 6.7% gain in operating earnings to $356.5 million on 12.5% higher sales revenue of $5 billion. Net income rose 33.9% to $323.2 million.
The tire segment, aided by five months of Trelleborg-TWS business, reported 13.6% higher revnenue of $4.44 billion. Segment business profit edged up 2.1% to $324.6 million, yielding an operating ratio of 7.3%.