Financial Information : Latest Financial Results
Latest Financial Results
Feb 16, 2024 Released
The Group has worked in line with its Mid Term Business Plan (2021-2023), released in February 2021, with the aim of accomplishing its 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” of the Bridgestone Essence. Guided by the mission and vision, we have set the “Bridgestone E8 Commitment” as our corporate commitment to support a sustainable society with our employees, society, partners and customers. This is the focus and vector of value creation. We are moving forward along the path of the “2030 Long Term Strategic Aspiration,” which depicts the vision we want to achieve in 2031, the 100th anniversary of our founding.
Amid a more severe business environment than expected, on the backdrop of a slowdown and a slump in demand for replacement tires for trucks and buses in the U.S. and Europe that had been remarkable since the second half, in the fiscal year ended December 31, 2023, we focused on “restructuring of the earning power” in the premium tire business, aiming to return to strong Bridgestone, which is capable of responding to changes, by “focusing on execution and delivering the results” of the Mid Term Business Plan (2021-2023) in its final year. We also focused on carefully selecting and making strategic growth investments, with emphases on strengthening premium tire production in the harsh business environment, and “laying foundation for the future.”
In the premium tire business, the overall demand environment for replacement tires was challenging, and amid a year-on-year decline in global sales volume, we further strengthened our focus on the premium domain. With respect to replacement tires for passenger cars, we promoted strategic price management, concurrently working to reduce losses and unprofitable areas, mainly by expanding sales of high-rim diameter tires, which have relatively little impact on environmental changes and maintained stable demand. At the same time, we launched high-performance, high-value-added Dan-totsu products to thoroughly improve sales mix. Amid a situation where demand for new tires is becoming more severe than expected, in the case of replacement tires for trucks and buses in North America, where we have strong business bases such as high product competitiveness and service base network, we were able to improve our share of new and retread tires in the premium domain by combining retread tires. In addition, with the foundation of Dan-totsu products, tires for mining vehicles, which have demonstrated the strength of respect for being on-site, such as tire maintenance services, and achieved solid sales and market share gains, underpinned the company’s overall performance in a challenging business environment. On the other hand, in the European business, which has been a management issue for the Group in terms of profitability and business foundation, weakness in the sales channel base and other factors emerged amid a difficult business environment, and there remain issues to be addressed for improvement. In the Americas business, in Argentina, where Financial Reporting in Hyperinflationary Economies (*1) was applied, the impact of a large devaluation of the currency significantly pushed down business results, which negatively impacted company-wide performance.
In light of the above, with regard to business results for the fiscal year ended December 31, 2023, a lack of response to address changes has become apparent, and it has become urgent for us to proficiently manage indicators to monitor change and quickly adapt to changes so that we can improve the quality and speed of the PDCA (Plan, Do, Evaluate, Improve) cycle in the coming fiscal year. This has resulted in a challenge for a “strong Bridgestone capable of adapting to change,” which was set as the goal at the beginning of the fiscal year. Revenue increased year-on-year due in part to the tailwind of favorable foreign exchange rates, an improved sales mix that was helped by sales of replacement premium tires for passenger cars (high-rim diameter tires (18 inches or more), high-profit premium tire brands in each region, etc.), and a year-on-year increase in the sales volume of tires for mining vehicles, despite a decline in the sales volumes of replacement tires for trucks and buses in the U.S. and Europe, for which there was a sharp drop in demand and the impact of applying Financial Reporting in Hyperinflationary Economies for Argentina. Adjusted operating profit including foreign currency effects declined year on year due to significant effects of increased processing costs resulting from deteriorated plant operation owing to a decrease in sales volume as well as a decrease in profit associated with applying Financial Reporting in Hyperinflationary Economies for Argentina, despite our continued efforts to offset negative effects of costs and expenses stemming from raw material prices and inflation (energy and labor costs, etc.) against improved selling price and sales mix, carry out through cost management and improve productivity in production sites. The impact of Financial Reporting in Hyperinflationary Economies for Argentina on the year-on-year decline in profits was approximately 10 billion yen. Excluding this impact, profits increased year-on-year. The adjusted operating profit ratio declined 0.6 percentage points from the previous fiscal year to 11.1%, falling short of the previous fiscal year. We will continue to accelerate our efforts to improve our business structure to respond to changes.
As a result, the Group’s revenue in FY2023 were ¥4,313.8 billion, a year-on-year increase of 5%; adjusted operating profit was ¥480.6 billion, a year-on-year decrease of 0.4%; operating profit was ¥481.8 billion, a year-on-year increase of 9%; profit before tax was ¥444.2 billion, a year-on-year increase of 5%; and profit attributable to owners of parent was ¥331.3 billion, a year-on-year increase of 10%.
（Yen in billions）
| 2022 Results(*3) | 2023 Results | vs. PY (%) | |
|---|---|---|---|
| Revenue(*2) | 4,110.1 | 4,313.8 | +5 |
| Adjusted Operating Profit(*2) Margin |
482.6 11.7% |
480.6 11.1% |
(0) (0.6)pp |
| Profit Attributable to Owners of Parent |
300.3 | 331.3 | +10 |
| - Continuing Operations | 305.4 | 326.9 | +7 |
| - Discontinued Operations | (5.1) | 4.4 | - |
| ROIC(*2) | 9.4% | 8.7% | (0.7)pp |
| ROE(*2) | 10.9% | 10.4% | (0.6)pp |
- IAS 29 'Financial Reporting in Hyperinflationary Economies'
- Revenue, Adjusted operating profit, ROIC and ROE show figures for continuing operations and exclude revenue and expenses of the discontinued operations.
- Due to the application of IAS 12 'Income Taxes', the figures of fiscal year 2022 have been revised retrospectively.
