Tire maker Bridgestone Corp. reported Wednesday a 68 percent plunge in net profit for the fiscal first half because of expenses related to closing a U.S. plant and the surging cost of raw materials, including crude oil and rubber.
Net profit at Bridgestone for the six months to June 30 totaled 32.8 billion yen, down from 101.7 billion yen for the same period a year earlier.
The profit drop came despite a 13 percent jump in sales to 1.4 trillion yen from 1.3 trillion yen, boosted by healthy sales of cars and trucks in Japan and Europe. The Tokyo-based company did not give quarterly results.
Plant closures cost the company 15.8 billion yen during the period, including a money-losing plant in Oklahoma City operated by Bridgestone’s U.S. subsidiary, Bridgestone Firestone North American Tire.
Soaring crude oil and rubber prices also took their toll on Bridgestone earnings. The absence of a pension-related reimbursement that boosted the previous year’s earnings was also a factor in bringing down profits, the firm said.
Bridgestone lowered its profit forecast for the fiscal year through next March to 62 billion yen from an earlier forecast of 65 billion yen.
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