Toyo Tire revises up full-year outlook as cost pressures ease

Hyogo, Japan – Toyo Tire Corp. has revised up its full-year financial outlook on the back of a strong first half, characterised by record-high sales.

The Japanese group has now raised operating earnings projections to Yen60 billion (€377 million) for the full-year, up from Yen50 billion announced 14 Feb.

Net sales are now expected to reach Yen560 billion in 2023 – compared to Yen540 billion previously – according to Toyo’s revised forecasts issued 10 Aug.

Operating income “outperformed our previous forecasts, as rises in raw materials prices and ocean freight costs turned out to be lower than expected, stated Toyo.

“The yen,” it added, “was weaker than anticipated against foreign currencies, and the benefits of cost-cutting measures were felt.”

The upgrade follows “record high” second quarter sales at Toyo, which left first half revenues 18.7% higher year-on-year to Yen265.5 billion.

The revenue gains over the six months to end of June were driven largely by growing sales of light truck tires in North America.

First half operating income grew 2.7% year-on-year to Yen26.6 billion, buoyed by an overall Yen13-billion positive impact from lower freight costs and foreign exchange.

The group's Tire business unit posted net sales for the first six months at Yen242.5 billion, up 18.9% compared to first half 2022.

Here, Toyo noted that sales increased across all regions, particularly in Japan and North America.

Meanwhile, a 74% improvement in operating income in Japan helped offset losses in North America and other regions, Toyo added.

The Automotive Parts business unit reported an operating loss of Yen728 million, compared to a loss of Yen1.4 billion reported in last year’s first half.

First half sales within the Automotive Parts business rose 16.2% year-on-year to Yen22.9 billion, according to Toyo's figures.

Toyo Tire FY23 forecasts for sales and operating earnings