Bridgestone Latest Financial Results 2024

The Group has established a vision of “continuing to provide social value and customer value as a sustainable solutions company toward 2050” under its mission of “Serving Society with Superior Quality.” Moreover, we have set the “Bridgestone E8 Commitment” as our corporate commitment to support a sustainable society with our employees, society, partners and customers and as the focus of our value creation. To realize this vision, we have formulated the “2030 Long Term Strategic Aspiration,” with an eye on 2031, the 100th anniversary of our founding. With this vision as our North Star, we have steadily carried out management in line with specific plans, laid forth in our Mid Term Business Plan (2024-2026), released in March 2024.

New threats have emerged including structural changes in the automotive industry driven by factors such as the strength of the Chinese EV market and accelerating structural changes in the tire industry such as increased imports of low-priced tires mostly to the European and South American markets. In this kind of challenging business environment requiring a prompt response to these threats, the Group has set its Management, Working & business quality improvement as its top priority, and while launching business restructuring and rebuilding initiatives as part of our Second Stage, we worked to “focus more on value creation” as part of our “respect for being on-site (Genbutsu-Genba).”

In the premium tire business, one of the Group’s core businesses, demand for new vehicle tires for passenger cars and small trucks has moderated globally against the backdrop of the slowdown in the shift to electric vehicles. Although demand in Asia slightly exceeded those of the previous fiscal year, especially demand in Europe and Japan declined significantly from the previous fiscal year, and demand in North America fell slightly. Demand for high-rim diameter tires (18 inches or more) reflected the shift to larger vehicles, and demand was on par with the previous fiscal year in North America and Europe, while in Japan, demand increased year-on-year. Demand for new truck and bus tires decreased significantly year-on-year in North America, Europe, and Asia, but demand in Japan was on par with the previous fiscal year, rebounding from the decline in vehicle manufacturing in the previous fiscal year caused by part supply shortages. Demand for replacement tires for passenger cars and small trucks has been impacted greatly by the trend of increased low-priced imported tires, due to the lowering of import tariffs on goods from Thailand and South Korea in January 2024 in North America, leading to decreased demand from the previous fiscal year among the major tire manufacturers that are members of tire manufacturers associations in the U. S. and Canada, while demand remained flat in Japan and Asia and increased in Europe amid a trend of gradual market recovery. Furthermore, demand continued to grow for replacement high-rim diameter tires (18 inches or more), centered on North America and Europe. Demand for replacement truck and bus tires rose year-on-year for the full year, as a result of North American retail inventory normalizing in the first quarter and demand gradually recovering from the second quarter onward. In Europe and Asia, demand recovered year-on-year, while in Japan, demand was mostly unchanged year-on-year.

Amid this type of demand environment, the Group’s revenue increased year-on-year due to progressive improvement in the sales mix achieved by expanding sales channels for premium passenger car tires in the replacement tire market (high-rim diameter tires (18 inches or more), high-profit premium tire brands in each region, etc.), as well as sales of ultra-large tires for mining vehicles remaining on par with the previous fiscal year, and the tailwind of favorable foreign exchange rates, despite the global reduction in unit sales of new vehicle tires for passenger cars and small trucks and tires for trucks and buses, as well as the deterioration of the Latin America business, mainly in Brazil and Argentina.

Adjusted operating profit slightly exceeded levels of the previous fiscal year, due to the steady implementation of restructuring and rebuilding initiatives (Second Stage), improvement in sales prices and the sales mix spread, as well as the favorable tailwind of the depreciated yen, which was able to absorb the decline in the Latin America business and the impact of reduced unit sales. During FY2024, the Group further strengthened our focus on the premium domain, centered on Dan-Totsu products, accelerated the reduction or exit from losses and unprofitable businesses, and continued to improve the sales mix. Despite the increase in the fixed cost burden and worsening of processing costs due to the impact of reduced unit sales of passenger car and small truck tires and truck and bus tires, in addition to declining marine transport unit costs, initiatives to reduce business costs set forth in the Mid Term Business Plan (2024-2026) including global procurement, global SCM (supply chain management) logistics reform, BCMA (Bridgestone Commonality Modularity Architecture), the green and smart transition, and steady improvements in onsite productivity (Genbutsu-Genba) all contributed positively to the Group’s business results. Furthermore, operating profit declined year-on-year as a result of the recording of restructuring and rebuilding-related expenses such as impairment losses on assets for Europe business use, despite the recording of a gain on the sale of Roppongi company housing in the second quarter.

As a result, the Group’s revenue in FY2024 were ¥4,430.1 billion, a year-on-year increase of 3%; adjusted operating profit was ¥483.3 billion, a year-on-year increase of 1%; operating profit was ¥443.3 billion, a year-on-year decrease of 8%; profit before tax was ¥421.4 billion, a year-on-year decrease of 5%; and profit attributable to owners of parent was ¥285.0 billion, a year-on-year decrease of 14%. Going forward, with pursuing the top priority on Management, Working & business quality improvement, the Group will carry out management that balances “defense” and “offense” while continuing to “focus more on value creation.”

1. Revenue and Adjusted Operating Profit, ROIC and ROE show figures for continuing operations and exclude revenue and expenses of the discontinued operations.

Source: Bridgestone