SA: Bridgestone still reviewing tyre operations

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SA: Bridgestone still reviewing tyre operations

By Tim Dornin, National Motoring Correspondent

ADELAIDE, April 28 AAP - Bridgestone Australia Ltd continued to review its local tyremaking operations, with significant productivity improvements and cost cutting neededto sustain the business, chairman Fumio Okuma said today.

In his address to the company's annual meeting, Mr Okuma said directors were currentlycommitted to local production.

But he said tyre manufacturing in Australia remained marginal.

"This remains an issue which is subject to ongoing review and will be influenced stronglyby the activities this year," he said.

After the meeting, Mr Okuma identified competition from cheap Asian imports as of primeconcern to the company.

"So tyre manufacturing here is very tough, not only for us but also for other manufacturers,"

he said.

But as to whether it had a long-term future he said it was: "Too early to tell."

Bridgestone directors also confirmed earlier forecasts of a profit dip in 2003, largelybecause of the rising cost of raw materials.

In January, Bridgestone reported a $12.6 million profit for the 2002 calendar year,a 41.2 per cent improvement on 2001.

But it also warned that it expected a lower figure this year.

Today, executive director of Finance Andrew Moffatt said the company was trading inline with its forecasts and expectations but declined to elaborate further.

"It's actually, similar to last year," he said of the company's trading position.

"However, the full impact of increased raw material prices hasn't yet hit."

Also today, prominent Bridgestone shareholder John Spalvins again questioned the companyabout its profit result, its share price and the make-up of the board.

Mr Spalvins, who controls more than 500,000 Bridgestone Shares as the chairman of investmentcompany Galufo Ltd, said while the improved 2002 result was welcomed it was still belowthe profit the company was making five years ago.

He said at about $2 Bridgestone shares also continued to trade well below 1997 levelsof more than $3.

Mr Spalvins also called on the company to comply with Australian Stock Exchange guidelinesfor all listed companies to have an independent chairman and a majority of independentdirectors.

At present, Bridgestone had an executive chairman, five executive directors and onenon-executive director.

Mr Okuma said the company expected to appoint a second non-executive director withinthe next few months.

In morning trade today, Bridgestone shares were one cent higher at $2.02.

AAP tjd/cd/de

KEYWORD: BRIDGESTONE