Quick Facts / Company Snapshot
- Company Name: Sumitomo Rubber Industries, Ltd.
- Headquarters: 3-6-9, Wakinohama-cho, Chuo-ku, Kobe, Hyogo 651-0072, Japan
- Establishment: 1909 (Incorporated in 1917)
- Representative Director & President: Satoru Yamamoto
- Core Business: Manufacture and sale of tires, sports goods, and industrial products
- Consolidated Sales Revenue (2024): ¥1,211,856 million
- Total Assets (2024): ¥1,341,123 million
- Operating Profit (2024): ¥11,186 million
- Profit for the Year (2024): ¥12,947 million
- Total Equity (2024): ¥675,810 million
- Primary Tire Brands: DUNLOP, FALKEN
- Primary Sports Brands: XXIO, SRIXON, Cleveland Golf
- Major Shareholder: Sumitomo Electric Industries, Ltd. (28.87%)
- Global Workforce: Approximately 40,000 employees (Consolidated)
Company Overview
Sumitomo Rubber Industries, Ltd. is a premier Japanese manufacturer specializing in rubber technology, with a dominant global presence in the tire and sports equipment sectors. Originating from the establishment of Japan’s first modern rubber factory in 1909, the company has evolved into a technological powerhouse known for its proprietary “Smart Tyre Concept” and “Active Tread” innovations.
The company operates under the Sumitomo Group’s business philosophy, focusing on creating value for society through reliability and integrity. Sumitomo Rubber Industries (SRI) manages a diverse portfolio that spans from high-performance automotive tires to championship-level golf equipment and critical industrial infrastructure like vibration control dampers. With a strategic vision targeted toward 2035, the company is currently transforming its business structure to emphasize high-value, sustainable products and services, moving beyond traditional manufacturing to offer solution-based mobility services.
Business Segments and Revenue Breakup %
Sumitomo Rubber Industries operates through three distinct reportable segments. The revenue contribution for the fiscal year ending December 31, 2024, is dominated by the Tire business.
- Tires Business (86.3% of Revenue)
- Revenue: ¥1,046,394 million
- Scope: This segment engages in the manufacture and sale of tires and tubes for a wide array of vehicles, including passenger cars, trucks, buses, construction machinery, agricultural vehicles, motorcycles, and racing cars. It also includes the automotive business which handles tire deflation warning systems and instant mobility systems. The segment operates primarily under the DUNLOP and FALKEN brands.
- Sports Business (10.4% of Revenue)
- Revenue: ¥125,650 million
- Scope: This segment covers the sale of sports goods such as golf clubs, golf balls, and tennis rackets. It also includes the operation of golf tournaments, golf and tennis schools, and fitness clubs. (Note: The company sold all shares in the subsidiary conducting fitness club operations in December 2024 ). Major brands include XXIO, SRIXON, and Cleveland Golf.
- Industrial and Other Products Business (3.3% of Revenue)
- Revenue: ¥39,812 million
- Scope: This segment utilizes advanced rubber technology for non-tire applications. Key products include high-function rubber products like vibration-control dampers for housing, medical rubber parts, and office equipment parts. It also produces infrastructure products such as marine fenders and artificial turf for sports facilities, as well as daily life products like rubber gloves for food preparation.
History and Evolution
Sumitomo Rubber Industries traces its roots back to the dawn of the rubber industry in Japan. Its history is marked by strategic alliances, acquisitions, and technological firsts.
- 1909: Established as the Japanese subsidiary of the Dunlop Rubber Company (UK), creating Japan’s first modern rubber factory.
- 1913: Produced Japan’s first automobile tire, setting the foundation for the country’s automotive industry.
- 1930: Began production of golf and tennis balls, diversifying early into sports.
- 1963: The Sumitomo Group assumed management control, and the company was renamed Sumitomo Rubber Industries, Ltd.
- 1980s (Global Expansion): The company aggressively expanded by acquiring Dunlop tire plants in the UK, Germany, and France (1984), and the Dunlop Tire Corporation in the USA (1986).
- 1999: Formed a global alliance with The Goodyear Tire & Rubber Company, which lasted until its dissolution in 2015.
- 2017: Acquired Micheldever Group Ltd., a leading tire distributor in the UK, to strengthen its wholesale and retail footprint.
- 2024: Launched “SYNCHRO WEATHER,” a next-generation all-season tire utilizing proprietary “Active Tread” technology that adapts rubber properties to road conditions.
Products and Services with Revenue Breakup %
The company’s product portfolio is engineered to serve both consumer and industrial markets. The revenue distribution mirrors the segment performance.
- Tires (86.3%):
- Passenger Car Tires: Standard, premium, and winter tires (e.g., ENASAVE, WINTER MAXX).
- Commercial Tires: Heavy-duty tires for trucks and buses.
- Motorcycle Tires: High-performance radial and bias tires.
- Automotive Systems: Tire Pressure Monitoring Systems (TPMS) and Sensing Core technology.
- Sports Goods (10.4%):
- Golf: Drivers, irons, putters, and balls (Brands: XXIO, SRIXON).
- Tennis: Rackets and tennis balls (Brand: DUNLOP).
- Services: Golf schools and tournament management.
- Industrial Products (3.3%):
- Infrastructure: Marine fenders, bridge bearings.
- Medical: Rubber parts for medical devices.
- Housing: “MIRAIE” vibration control dampers for earthquake protection.
- Daily Use: Rubber gloves and ramps for wheelchairs.
Brand Portfolio with Revenue %
While specific revenue percentages per individual brand are not disclosed in the consolidated statements, the segment revenue serves as a proxy for brand dominance.
- DUNLOP: The flagship brand for both tires and sports (tennis) in major global markets. It anchors the Tire segment which generates ¥1.04 trillion in revenue.
- FALKEN: A high-performance tire brand popular in North America and Europe, often associated with motorsports and OEM fitments.
- XXIO: A premium golf brand holding a top market share in Japan, known for lightweight technology.
- SRIXON: A global golf brand used by professional tour players, focusing on performance balls and clubs.
- Cleveland Golf: Specializes in wedges and short-game equipment.
Geographical Presence and Region-wise Revenue %
Sumitomo Rubber Industries has a diversified global footprint. In 2024, overseas sales accounted for nearly 72% of total revenue, highlighting its status as a global conglomerate.
- Japan (28.4%):
- Revenue: ¥344,547 million
- Presence: Headquarters in Kobe/Tokyo. multiple factories (Shirakawa, Nagoya, Miyazaki, etc.).
- North America (23.6%):
- Revenue: ¥285,525 million
- Presence: Manufacturing in Buffalo, NY (USA). Sales subsidiaries for tires and sports.
- Europe (17.6%):
- Revenue: ¥213,528 million
- Presence: Manufacturing in Turkey. R&D in Germany. Micheldever distribution network in the UK.
- Asia (16.5%):
- Revenue: ¥199,992 million
- Presence: Major manufacturing hubs in Thailand, China (Changshu, Hunan), and Indonesia.
- Other Regions (13.9%):
- Revenue: ¥168,264 million
- Presence: Includes South America (Brazil factory) and other global markets.
Financial Performance Analysis
The fiscal year 2024 presented a mixed but resilient financial picture. While top-line revenue grew, profitability metrics were impacted by significant one-off expenses and external economic factors.
Consolidated Performance Trends
- Revenue Growth: Sales revenue increased from ¥1,177,399 million in 2023 to ¥1,211,856 million in 2024, a growth of approximately 2.9%.
- Business Profit: The company’s “Business Profit” (a key management metric defined as sales revenue less cost of sales and SG&A) rose to ¥87,941 million from ¥77,670 million in 2023.
- Net Profit Decline: Despite higher sales and business profit, the Profit for the Year attributable to owners of the parent dropped significantly to ¥9,865 million in 2024 from ¥37,048 million in 2023. This was largely due to a substantial increase in “Other expenses.”
Profit and Loss Analysis
- Sales Revenue: ¥1,211,856 million. The increase was driven by strong sales in the North American and European tire markets.
- Cost of Sales: ¥853,568 million. The cost ratio remained relatively stable, reflecting effective cost management despite raw material price fluctuations.
- Gross Profit: ¥358,288 million, resulting in a gross margin of 29.6%.
- SG&A Expenses: ¥270,347 million. Selling, general, and administrative expenses increased, reflecting higher logistics and operational costs.
- Other Expenses: A critical figure of ¥80,976 million was recorded in 2024, a massive jump from ¥15,789 million in 2023. This line item severely impacted the final operating profit.
- Operating Profit: ¥11,186 million. This represents a sharp decline from ¥64,490 million in 2023, resulting in a thin operating margin of 0.9%.
- Profit Before Tax: ¥16,251 million.
- Income Tax Expenses: ¥3,304 million.
- Basic Earnings Per Share (EPS): ¥37.51, down from ¥140.86 in the previous year.
Balance Sheet Analysis
The company maintains a heavy asset base typical of a manufacturing giant, with significant inventory and property holdings.
Assets
- Total Assets: ¥1,341,123 million, an increase from ¥1,266,732 million in 2023.
- Current Assets: ¥669,762 million. Key components include:
- Inventories: ¥290,947 million, indicating a significant stock of raw materials and finished goods.
- Trade and Other Receivables: ¥221,679 million.
- Cash and Cash Equivalents: ¥100,382 million, showing a healthy liquidity buffer.
- Non-Current Assets: ¥671,361 million. This includes:
- Property, Plant and Equipment: ¥444,047 million.
- Goodwill: ¥29,457 million.
- Intangible Assets: ¥59,087 million.
Liabilities
- Total Liabilities: ¥665,313 million.
- Current Liabilities: ¥370,615 million. Notable items include Bonds and loans payable of ¥89,805 million and Trade payables of ¥186,587 million.
- Non-Current Liabilities: ¥294,698 million, primarily Long-term Bonds and loans payable of ¥162,637 million.
Equity
- Total Equity: ¥675,810 million.
- Retained Earnings: ¥520,815 million, demonstrating a strong accumulation of past profits.
- Equity Ratio: The equity attributable to owners of the parent is ¥656,134 million, resulting in an equity ratio of approximately 48.9%.
Cash Flow Analysis
The cash flow statement for 2024 reveals the company’s ability to generate cash from operations and its heavy investment in future capabilities.
- Cash Flows from Operating Activities: Net cash provided was ¥104,325 million.
- The largest positive contributor was Depreciation and Amortization (¥83,168 million).
- A significant impairment loss of ¥45,124 million was added back to the cash flow, reflecting non-cash charges.
- Cash Flows from Investing Activities: Net cash used was ¥(64,659) million.
- Capital Expenditure: Purchase of property, plant, and equipment accounted for an outflow of ¥56,797 million.
- Intangible Assets: Purchase of intangible assets required ¥15,440 million, likely for R&D and software related to new technologies like Sensing Core.
- Cash Flows from Financing Activities: Net cash used was ¥(35,623) million.
- Dividends: Cash dividends paid amounted to ¥21,561 million.
- Debt Management: Repayments of long-term debt were ¥35,000 million, balanced partly by proceeds from long-term debt of ¥43,997 million.
- Net Increase in Cash: The company increased its cash and cash equivalents by ¥10,131 million during the year.
Management Discussion & Analysis (MD&A)
- Operating Results: Management reported a solid increase in Sales Revenue (up 2.9%) and Business Profit (up 13.2%). This growth was attributed to favorable sales in the North American and European markets, despite challenging global economic conditions. However, the Operating Profit fell sharply due to “Other expenses,” which included significant impairment losses (¥45,124 million) and business restructuring costs.
- Segment Performance Drivers:
- Tires: Achieved revenue growth but faced high costs. The company focused on premiumization to protect margins.
- Sports: Faced a challenging year with a decrease in segment profit from ¥12,482 million in 2023 to ¥7,878 million in 2024.
- Industrial: Showed improvement in business profit, rising to ¥3,725 million.
- Economic Environment: The company navigated a landscape of high raw material prices and logistics costs. The Turkish subsidiary’s financial statements were adjusted for hyperinflation, impacting the consolidated results.
- Strategic Disposals: In December 2024, the company executed a strategic move by selling all shares of the subsidiary responsible for fitness club operations, streamlining the Sports portfolio to focus on core hard goods.
Board of Directors and Leadership Team
The leadership structure is headed by the Representative Director and President, supported by a board that oversees governance and strategic execution.
- Satoru Yamamoto: Representative Director and President
- Ikuji Ikeda: Chairman of the Board
- Kazuo Kinameri: Representative Director
- Hidekazu Nishiguchi: Representative Director
- Outside Directors: The board includes multiple outside directors such as Keizo Kosaka, Kenji Murakami, and Mari Sonoda to ensure independent oversight.
- Audit & Supervisory Board: Includes standing members like Hiroaki Tanaka and Takashi Kono.
Subsidiaries, Associates, Joint Ventures and Revenue %
Sumitomo Rubber Industries heads a vast network of subsidiaries worldwide. While individual revenue percentages for each subsidiary are not itemized, their regional aggregations drive the consolidated figures.
- Sumitomo Rubber North America, Inc.: Key sales subsidiary driving the 23.6% North American revenue share.
- Sumitomo Rubber AKO Lastik Sanayi ve Ticaret A.Ş. (Turkey): A major manufacturing hub for Europe, subject to hyperinflationary accounting in 2024.
- Sumitomo Rubber (Thailand) Co., Ltd.: A critical production base for the Asian and global markets.
- Sumitomo Rubber (Changshu) Co., Ltd. & Sumitomo Rubber (Hunan) Co., Ltd.: Primary manufacturing entities in China.
- Dunlop Sports (various entities): Subsidiaries managing the sports business in regions like the US, Europe, and Asia.
- Micheldever Group Ltd.: The UK-based tire distributor acquired in 2017.
Physical Properties (Offices, Plants, Factories)
The company operates a global network of manufacturing plants, R&D centers, and proving grounds.
- Domestic Factories (Japan):
- Shirakawa Factory: Fukushima Prefecture.
- Nagoya Factory: Aichi Prefecture.
- Izumiotsu Factory: Osaka Prefecture.
- Miyazaki Factory: Miyazaki Prefecture.
- Overseas Factories:
- Thailand: Amata City (Rayong).
- China: Changshu and Hunan.
- Indonesia: Cikampek.
- Turkey: Cankiri.
- USA: Tonawanda, New York.
- Brazil: Fazenda Rio Grande.
- South Africa: Ladysmith.
- R&D and Testing:
- Tyre Technical Center: Kobe, Japan.
- Okayama Tire Proving Ground: Okayama, Japan.
- Nayoro & Asahikawa Tire Proving Grounds: Hokkaido, Japan (for winter tire testing).
Segment-wise Performance
- Tires Segment:
- Sales to External Customers: ¥1,046,394 million (Up from ¥1,006,381 million in 2023).
- Segment Profit (Business Profit): ¥76,181 million.
- Performance: The segment drove the company’s revenue growth. However, it incurred significant impairment losses of ¥41,931 million, which weighed heavily on the final operating profit.
- Capital Expenditure: ¥72,057 million was invested in this segment, reflecting continuous upgrades to manufacturing lines.
- Sports Segment:
- Sales to External Customers: ¥125,650 million (Down slightly from ¥126,647 million in 2023).
- Segment Profit (Business Profit): ¥7,878 million (Down from ¥12,482 million in 2023).
- Performance: Profitability dipped in 2024. The segment also saw the divestiture of the fitness club business.
- Industrial and Other Products Segment:
- Sales to External Customers: ¥39,812 million (Down from ¥44,371 million in 2023).
- Segment Profit (Business Profit): ¥3,725 million (Up significantly from ¥1,603 million in 2023).
- Performance: Despite lower sales, this segment more than doubled its business profit, indicating successful restructuring or high-margin product focus.
Founders
The original foundation of the business in Japan dates back to 1909, established by the British Dunlop Rubber Company. The modern corporate philosophy is deeply rooted in the Sumitomo Business Spirit, originating from Masatomo Sumitomo (1585–1652), the founder of the Sumitomo Group. His teachings, known as “Monjuin Shiigaki,” emphasize integrity, reliability, and avoiding the pursuit of easy gains. This historical spiritual foundation guides the company’s current management principles known as “The SRI Way.”
Shareholding Pattern
As of June 30, 2025 (latest available disclosure from website data), the shareholding structure reflects strong institutional and corporate backing.
- Sumitomo Electric Industries, Ltd.: The largest shareholder, holding 28.87% (75,879 thousand shares).
- The Master Trust Bank of Japan, Ltd. (Trust Account): Holds 11.61%.
- Custody Bank of Japan, Ltd. (Trust Account): Holds 4.75%.
- Foreign Investors: Significant presence, including Northern Trust Co. (Silchester International Investors) with 3.53%.
- Sumitomo Mitsui Banking Corporation: Holds 1.39%.
Parent
Sumitomo Rubber Industries does not have a “Parent” company in the traditional sense of being a wholly-owned subsidiary. However, Sumitomo Electric Industries, Ltd. is a major shareholder with 28.87% ownership, exercising significant influence as an affiliate within the broader Sumitomo Group keiretsu.
Investments and Capital Expenditure Plans
The company is aggressively investing in its future capabilities, specifically in manufacturing and R&D.
- Capital Expenditures (2024): Totaled ¥78,065 million.
- Tires: ¥72,057 million (92% of total Capex).
- Sports: ¥4,364 million.
- R&D Priorities: Investments are channeled into “Active Tread” rubber technology and “Sensing Core” software. In 2024, the company spent ¥15,440 million on the purchase of intangible assets, a proxy for its software and technology development investment.
- Strategic Allocation: The company has revised its mid-term plan to allocate strategic investment toward tire premiumization and growth businesses like wellness and circular economy solutions.
Future Strategy
Sumitomo Rubber Industries has unveiled its long-term corporate strategy, “R.I.S.E. 2035,” aimed at redefining the company by 2035.
- Vision 2035: “Continuing to Provide ‘New Experiential Value’ Born from Rubber to Everyone.”
- Mid-Term Targets (2027):
- Business Profit Margin: 10%
- ROE: 10%
- D/E Ratio: 0.6
- ROIC: 8%
- Long-Term Targets (2030):
- Business Profit Margin: 15%
- Premium Tire Ratio: >60% (by sales volume).
- Strategic Pillars:
- Innovation Driven by Rubber: Launching products like “Synchro Weather” with Active Tread.
- Strengthening Brand Management: Acquiring the Dunlop trademark in previously restricted regions (e.g., Malaysia, Singapore) to unify the brand globally.
- Portfolio Transformation: By 2035, the goal is for non-tire and growth businesses to account for 30% of total business profit.
Competitive Landscape
While the provided report focuses on SRI’s internal data, the company operates in a fiercely competitive global market.
- Global Competitors: The company historically had an alliance with Goodyear (USA), which is now a major competitor following the alliance dissolution.
- Domestic Competitors: The company competes with other major Japanese tire manufacturers (often implied as Bridgestone and Yokohama in industry contexts, though SRI’s report explicitly names Sumitomo Electric Industries as a shareholder/partner rather than a competitor).
- Market Position: SRI leverages its unique position with the DUNLOP brand in Europe/Asia and FALKEN in North America to compete against global tier-1 manufacturers.
Key Strengths
- Strong Brand Equity: Ownership of the DUNLOP brand (in major regions) and FALKEN, plus the dominant XXIO golf brand.
- Proprietary Technology: Development of “Active Tread” (rubber that changes properties) and “Sensing Core” (tire software that detects road conditions).
- Global Manufacturing Footprint: A diversified network of 12 tire factories and multiple sports/industrial factories across nearly all continents.
- Financial Resilience: A strong equity ratio of nearly 49% and over ¥100 billion in cash reserves as of the end of 2024.
Key Challenges and Risks
- Raw Material Volatility: The company is susceptible to price fluctuations in natural rubber and petroleum-based materials, which directly impact the cost of sales.
- Currency Fluctuations: With nearly 72% of sales overseas, exchange rate volatility (especially USD and EUR vs. JPY) significantly affects reported earnings. The company recorded positive currency translation differences of ¥37,297 million in 2024, but this remains a swing factor.
- Geopolitical Risks: Operations in Turkey (hyperinflation economy) and diverse global supply chains expose the company to regional instability.
- Impairment Risks: The company recorded a massive impairment loss of ¥45,124 million in 2024, highlighting the risk of asset devaluation in specific segments or regions.
Conclusion and Strategic Outlook
Sumitomo Rubber Industries, Ltd. closed 2024 with record sales revenue of ¥1.2 trillion, demonstrating the robust demand for its mobility and sports products in global markets. While one-off impairment losses dampened net profitability for the year, the underlying “Business Profit” grew by over 13%, signalling strong operational health.
Looking ahead, the company is aggressively pivoting from a traditional manufacturer to a value-creation company through its R.I.S.E. 2035 strategy. By commercializing breakthrough technologies like Active Tread and integrating Sensing Core into the broader mobility ecosystem, Sumitomo Rubber is positioning itself to lead in the era of autonomous and sustainable transportation. The strategic divestiture of non-core assets (fitness clubs) and the focus on tire premiumization suggest a disciplined approach to achieving its ambitious 15% margin target by 2030.
Official Site: http://www.srigroup.co.jp/english
FAQ Section
1. What are Sumitomo Rubber Industries’ main brands? The company’s primary tire brands are DUNLOP and FALKEN. In the sports segment, it owns and operates XXIO, SRIXON, and Cleveland Golf.
2. What was Sumitomo Rubber’s revenue in 2024? For the fiscal year ended December 31, 2024, Sumitomo Rubber Industries reported a consolidated sales revenue of ¥1,211,856 million.
3. Where is Sumitomo Rubber Industries headquartered? The company is headquartered in Kobe, Hyogo Prefecture, Japan.
4. What is the “Active Tread” technology mentioned in their strategy? Active Tread is a proprietary technology where the tire’s rubber compound actively adapts its properties (like softness and grip) in response to changing road conditions such as rain or ice.
5. Who is the largest shareholder of Sumitomo Rubber Industries? Sumitomo Electric Industries, Ltd. is the largest shareholder, holding approximately 28.87% of the company’s shares.
6. Does Sumitomo Rubber still own fitness clubs? No. In December 2024, the company sold all shares of the subsidiary responsible for its fitness club operations to focus on its core businesses.
Content is based on publicly available corporate filings, regulatory disclosures, annual reports, 10-K filings, Investor Relations materials, and direct mail communication with the company.
