Bridgestone rebuilding earnings power as advances mid-term plan

Tokyo – Bridgestone Corp. has ‘largely completed’ its efforts to rebuild group earnings power, with strong results reported for 2021.

Earnings (adjusted operating profit) rose 90% year-on-year to Yen394 billion (€3 billion), on 20% higher sales of Yen3,250 billion, the Japanese tire maker reported 15 Feb. 

Bridgestone said it had already achieved the 2022 goals of its three-year mid-term business strategy, which was launched in February 2021. 

“Global tire sales grew substantially, especially in the premium segment, and the company achieved significant year-on-year growth both in revenue and profit,” the group stated.

As part of the mid-term plant, Bridgestone decided to divest its anti-vibration rubber business and chemical products solution business, helping its diversified products division return to profit.

Breaking down the performance, the group said sales of passenger car and light vehicle tires rose 19% to Yen1,735 billion, while operating profit more than doubled to Yen246.6 billion.

Truck and bus tires reported a 54% growth in operating profit to Yen88 billion, on 23% higher sales of Yen814 billion.

Specialities, covering two-wheeler, construction, farm and aircraft tires, reported a 90% increase in operating profit to Yen77.7 billion, as sales grew 26% to Yen393 billion. 

Diversified products returned to profit at Yen10.2 billion, on sales of Yen243 billion, excluding the results if the now discontinued US building materials business, anti-vibration rubber business and chemical products solutions units.

Overall, the group’s operating profit was lifted by over Yen378 billion, helped by increased volumes, cost conversion, pricing and mix as well as foreign currency gains.

These factors, said Bridgestone, more than offset the Yen79 billion negative impact of freight costs and Yen100 billion hike in raw material costs.

In terms of regions, the Japanese group saw growth in all markets, with Europe, Russia, Middle East, India and Africa posting 26% growth in sales to Yen694 billion.

Here, sales of passenger car tires and truck & bus tires rose significantly, as the unit returned to profit at Yen42.1 billion, compared to a loss of Yen21 billion reported last year.

Other regions also saw double-digit increases in sales, with Americas reporting a 25% rise in revenue to Yen1,454 billion and operating profit up 74% year-on-year to Yen190 billion.

Sales in Japan were up 12% at Yen873 billion, while operating profit increased 29% to Yen117 billion.

China and Asia Pacific also reported a 68% growth in operating profit to Yen42 billion, on 20% higher revenue of Yen387 billion.