Bridgestone 2004 Annual Report Download - page 29

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27
Financial Section
In the tires segment, the Companies’ sales—inclusive of inter-segment transactions—increased
5%, to ¥1,931.8 billion ($18,538 million), mainly on the strength of strong demand in markets out-
side Japan. In the diversified products segment, sales increased 6%, to ¥512.8 billion ($4,921 mil-
lion), led by growth in automotive products and—in the United States—in building materials.
Composition of sales by industry segment
(net of inter-segment transactions)
(% of net sales)
FY 2004 2003
Tires 79.8 79.7
Diversified products 20.2 20.3
100.0 100.0
Operating income
Operating income increased 8%, to ¥197.7 billion ($1,897 million). That increase comprised
increases of 8%, to ¥160.3 billion ($1,538 million)—inclusive of inter-segment transactions—in
the tires segment, and of 5%, to ¥36.5 billion ($350 million), in the diversified products segment.
The increase in operating income occurred despite rising prices for raw materials, an increase in
depreciation expenses, and the weakening of the U.S. dollar against the yen. It reflected the growth
in net sales and a decline in pension costs in Japan. The decline in pension costs resulted from an
exemption from payments for the future obligations attributable to the governmental portion of
its pension fund. The operating income margin rose 0.2 percentage points, to 8.2%.
Operating income margin
(% of net sales)
FY 2004 2003 2002 2001 2000
8.2 8.0 8.2 5.5 8.1
Other income and expenses
Net other income and expenses declined 21%, to ¥16.8 billion ($161 million). Net interest expense
was essentially unchanged, and foreign currency exchange loss was ¥2.7 billion ($26 million) less
than in the previous year. The Companies recorded a gain of ¥2.5 billion ($24 million) on the sale of
fixed assets, and they recorded a ¥3.2 billion ($31 million) loss on a voluntary tire replacement inau-
gurated by the Companies’ operations in the Americas in February 2004.
In the previous year, the Companies recorded an extraordinary loss of ¥3.8 billion in connection
with a fire at their Tochigi Plant, in Japan; an extraordinary gain of ¥4.3 billion in insurance claims
2000 2001 2002 2003 2004
¥
billion
1,928.0
1,560.2
1,687.2 1,797.6 1,836.4
2000 2001 2002 2003 2004
¥
billion
488.7
446.7 446.6 450.2 467.5
Sales of Tires
(net of inter-segment transactions)
Sales of Diversified Products
(net of inter-segment transactions)