Bridgestone curbs expectations after strong 2022

Tokyo - Bridgestone Corp. foresees only modest improvements in its business performance for 2023, with projected year-on-year increases of 1% in revenues and 6% for adjusted operating earnings. 16 Feb.

This is despite the Japanese group announcing strong 2022 results: adjusted operating profit up 22% year-on-year to Yen482.6 billion (€3,366 million) on sales 27% higher at Yen4,110.1 billion.

The guarded 2023 outlook reflects Bridgestone concerns over factors such as currency movements, raw materials & feedstock pricing, global economic uncertainty and international political instability.

in 2022 fiscal report, Bridgestone said: “While restrictions on economic activity due to Covid-19 have been relaxed in many countries, raw material prices have skyrocketed and supply-chains have been in turmoil.”

In a review of markets, the group said demand for replacement tires was hit by economic woes, mainly in the US and Europe, including a significant slowdown in the fourth quarter.

On the other hand, demand for larger-rim passenger car and light truck tires “remained relatively strong” as did the North America market for premium truck & bus tires.

After a first-half decline, meanwhile, OE tire demand started to recover as the impact of microchip shortages on the vehicle production eased.

But cost pressures remained, largely due to a sharp rise in crude oil and materials prices and “persistently surging rates for ocean freight, energy costs, and labour costs.

In response, Bridgestone strengthened its “strategic price management” and “premium business strategy” in each region.

“We responded flexibly to fluctuations in tire demand through flexible supply management… and worked to ensure profitability and expand sales at the same time,” the report added.

Regionally, Bridgestone posted sales and earnings increases of 19% and 20% in Japan to reach Yen1,036.3 billion and Yen140.3 billion respectively, while the equivalent figures in North America were 37% and 32% to Yen1,988.0 billion and Yen251.2 billion.

In Europe, revenue rose 25% to Yen870.0 billion, while adjusted operating profit came in 58% higher at Yen66.4 billion.

Bucking the positive profits trends, China, Asia-Pacific registered 5% lower adjusted earnings, at Yen39.9 billion, though sales increased 18% to Yen457.0 billion, helped by higher selling prices and depreciation of the yen.