Note: This document has been translated from the Japanese original for reference purposes only.

In the event of any discrepancy

between this translated document and the Japanese original, the original shall prevail.

February 16, 2024

Consolidated Financial Results
for the Fiscal Year Ended December 31, 2023 [IFRS]
Company name: The Yokohama Rubber Co., Ltd.
Listing: Tokyo Stock Exchange
Securities code: 5101
URL: https://www.y-yokohama.com/global/
Representative: Masataka Yamaishi, President, Chairman of the Board
Inquiries: Michio Yoshitake, General Manager and Head of Corporate Finance & Accounting Dept.
Telephone: +81-463-63-0437
Scheduled date of ordinary general meeting of shareholders: March 28, 2024
Scheduled date to commence dividend payments: March 29, 2024
Scheduled date of submission of annual securities report: March 28, 2024
Preparation of supplementary material on financial results: Yes
Holding of financial results briefing: Yes (for analysts)

(Yen amounts are rounded to the nearest million yen.)

1. Consolidated financial results for the fiscal year ended December 31, 2023 (from January 1, 2023 to
December 31, 2023)
(1) Consolidated operating results (Percentages indicate year-on-year changes.)
Profit attributable Total
Sales revenue Business profit Operating profit to owners of the comprehensive
parent income
Millions of yen % Millions of yen % Millions of yen % Millions of yen % Millions of yen %
Fiscal year ended
985,333 14.5 99,127 41.4 100,351 45.8 67,234 46.4 137,432 35.9
December 31, 2023
Fiscal year ended
860,477 28.3 70,089 12.8 68,851 (17.7) 45,918 (29.9) 101,104 (16.8)
December 31, 2022
Note: Business profit is calculated by deducting cost of sales and selling, general, and administrative expenses from sales revenue.

Return on equity
Basic earnings Diluted earnings Business profit
attributable to Return on asset
per share per share margin
owners of the parent
Yen Yen % % %
Fiscal year ended
419.32 418.31 9.9 7.2 10.1
December 31, 2023
Fiscal year ended
286.38 285.80 8.1 6.6 8.1
December 31, 2022

(2) Consolidated financial position

Ratio of equity
Equity attributable Equity attributable
attributable to
Total assets Total equity to owners of the to owners of the
owners of the
parent parent per share
parent
Millions of yen Millions of yen Millions of yen % Yen
As of December 31,
1,600,458 748,795 739,565 46.2 4,600.78
2023
As of December 31,
1,151,076 623,121 614,424 53.4 3,823.47
2022
(3) Consolidated cash flows
Cash flows from Cash flows from Cash flows from Cash and cash equivalents
operating activities investing activities financing activities at the end of period
Millions of yen Millions of yen Millions of yen Millions of yen
Fiscal year ended
159,741 (344,015) 205,760 97,613
December 31, 2023
Fiscal year ended
39,231 (46,357) 35,172 75,572
December 31, 2022

2. Dividends
Dividends per share Dividend on
Total dividends Payout ratio
equity
End of 1Q End of 2Q End of 3Q Year-end Annual paid (consolidated)
(consolidated)
Yen Yen Yen Yen Yen Millions of yen % %
Fiscal year ended
– 33.00 – 33.00 66.00 10,606 23.0 1.9
December 31, 2022
Fiscal year ended
– 34.00 – 50.00 84.00 13,503 20.0 2.0
December 31, 2023
Fiscal year ending
December 31, 2024 – 42.00 – 51.00 93.00 20.0
(forecast)

3. Consolidated financial results forecast for the fiscal year ending December 31, 2024 (from January 1, 2024 to
December 31, 2024)
(Percentages indicate year-on-year changes.)
Profit attributable to Basic earnings
Sales revenue Business profit Operating profit
owners of the parent per share
Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen
First half (cumulative) 500,000 12.8 42,000 64.3 43,000 52.6 25,500 (7.9) 158.63
Full year 1,060,000 7.6 115,000 16.0 115,500 15.1 74,500 10.8 463.46
* Notes
(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in change in
scope of consolidation): Yes
Newly included: 5 companies (Yokohama TWS Holding AB, Yokohama TWS North America, Inc.,
Yokohama TWS Czech Republic a.s., Yokohama TWS Australia Pty Ltd, Yokohama TWS
Brazil Ltda.)
Excluded: – companies
(2) Changes in accounting policies and changes in accounting estimates
(i) Changes in accounting policies required by IFRS: None
(ii) Changes in accounting policies due to other reasons: None
(iii) Changes in accounting estimates: None
(3) Number of issued shares (common shares)
(i) Total number of issued shares at the end of the period (including treasury shares)
As of December 31, 2023 169,549,081 shares
As of December 31, 2022 169,549,081 shares

(ii) Number of treasury shares at the end of the period

As of December 31, 2023 8,801,310 shares
As of December 31, 2022 8,851,231 shares

(iii) Average number of shares outstanding during the period

Fiscal year ended December 31, 2023 160,340,105 shares
Fiscal year ended December 31, 2022 160,338,899 shares

[Reference] Non-consolidated Results

Non-consolidated financial results for the fiscal year ended December 31, 2023 (from January 1, 2023 to
December 31, 2023)
(1) Non-consolidated operating results
(Percentages indicate year-on-year changes.)

Net sales Operating profit Ordinary profit Profit

Millions of yen % Millions of yen % Millions of yen % Millions of yen %
Fiscal year ended
417,875 7.5 54,245 320.8 84,716 96.2 79,052 90.4
December 31, 2023
Fiscal year ended
388,816 23.6 12,890 (13.6) 43,189 64.7 41,514 3.9
December 31, 2022

Basic earnings Diluted earnings

per share per share
Yen Yen
Fiscal year ended
493.03 491.84
December 31, 2023
Fiscal year ended
258.92 258.39
December 31, 2022

(2) Non-consolidated financial position

Total assets Net assets Equity-to-asset ratio Net assets per share
Millions of yen Millions of yen % Yen
As of December 31,
1,089,053 445,843 40.9 2,773.56
2023
As of December 31,
725,594 378,998 52.2 2,358.45
2022
Reference: Shareholders’ equity:
As of December 31, 2023: ¥445,843 million
As of December 31, 2022: ¥378,998 million
* Financial results reports are exempt from audit conducted by certified public accountants or an audit
corporation.

* Proper use of earnings forecasts and other special matters

(Cautionary statements with respect to forward-looking statements and other information)
The earnings forecasts herein are prepared by the Company based on information available to the Company as of the
announcement of this document. Actual results may differ from these forecasts due to a wide range of factors.
For the assumptions underlying the earnings forecasts and precautions regarding their use,please refer to “1. Operating Results, (1)
Analysis of Operating Results,” on pages 2 to 3 of the accompanying material.
○Contents of Attached Materials

1. Operating Results
(1) Analysis of Operating Results 2
(2) Analysis of Consolidated Financial Position 4
(3) Basic Policy for the Appropriation of Profits and Dividends for FY2023 and FY2024 5
(4) Risks 5
2. Management Policies
(1) Yokohama Rubber’s Basic Management Policies 8
(2) Key Management Performance Indicators Established as Targets in the
Company’s Current Medium-term Management Plan 8
(3) Company’s Medium-to-Long-term Management Strategies and Issues to be Addressed 8
3. Basic Policy on the Selection of Accounting Standard 10
4. Consolidated Financial Statements and Principal Notes
(1) Consolidated Statement of Financial Position 11
(2) Consolidated Statement of Profit or Loss and Consolidated Statement of Comprehensive Income 13
(3) Consolidated Statement of Change in Equity 15
(4) Consolidated Statement of Cash Flows 17
(5) Notes Concerning Consolidated Financial Statements 18
(Notes on going concern assumption) 18
(Segment information) 18
(Earnings per share) 21
(Significant subsequent events) 21
1. Qperating Results
(1) Analysis of Operating Results
①Operating results for FY2023

FY2022 FY2023 YoY change

¥ million ¥ million %
Sales revenue 860,477 985,333 +14.5
Tires 754,309 874,863 +16.0
MB 96,248 101,885 +5.9
Others 9,919 8,585 (13.4)
Business profit 70,089 99,127 +41.4
Tires 66,843 92,026 +37.7
MB 3,965 7,155 +80.5
Others (758) (76) –
Adjustments 40 22 –
Operating profit 68,851 100,351 +45.8
Profit before tax 71,622 105,975 +48.0

Profit attributable to
45,918 67,234 +46.4
owners of the parent
Note: Business profit is calculated by deducting cost of sales and selling, general, and administrative expenses
from revenues.

Regarding the operating environment for the Yokohama Rubber Group in fiscal 2023 (January 1, 2023 –
December 31, 2023), the Japanese economy remained on a recovery trend, with capital investment gradually
rebounding and improving business sentiment observed in a wide range of industries, especially the automotive
industry, where unit sales of automobiles were solid. In addition, the recovery in inbound demand supported
continued rebounds in the accommodation and food & beverage service industries. Progress in passing on cost
increases to product prices also supported recovery trend.
In overseas markets, solid personal consumption in the United States was strong, supported by solid employment
and income environments. While U.S. nonmanufacturers fared well, manufacturing sectors other than high tech
remained in a prolonged adjustment phase with output declining. China’s economy entered a slowdown in spring,
with the sharp decline in investment in property development reducing overall investment in the economy as a
whole. In Europe, where the situation in Ukraine shows no signs of improving, sluggish demand continues to make
it difficult for the manufacturing and service industries to pass on cost increases to prices.
In the above operating environment, the Yokohama Rubber Group continued to implement its Yokohama
Transformation 2023 (YX2023) medium-term management plan focused on simultaneously promoting the
“exploitation” of the strengths of its existing businesses and the “exploration” of new value that will meet the needs
of customers and society in an era of great change, as the Group strives for “transformation” that will drive growth
over the next generation. As a result, consolidated results for fiscal 2023 included sales revenue of ¥985,333 million
(+14.5% YoY), business profit of ¥99,127 million (+41.4% YoY), operating profit of ¥100,351 million (+45.8%
YoY), and profit attributable to owners of the parent totaling ¥67,234 million (+46.4% YoY).

2
②Segment results
Tires
Sales revenue totaled ¥874,863 million (+16.0% YoY), accounting for 88.8% of the Yokohama Rubber Group’s
consolidated sales revenue. Segment business profit was ¥92,026 million (+37.7% YoY).
The Company’s business in original equipment tires expanded as sales of vehicle models factory-fitted with
Yokohama Rubber tires grew in Japan and in North America and as the Company won new fitments on vehicle
models. Those factors more than offset the continuing weakness in Japanese automakers’ sales in China.
Yokohama Rubber also posted sales growth over the previous year in replacement tires. Its Japanese business in
replacement summer tires was robust, and the Company replacement tire business expanded, too, in China, in India,
and in other Asian markets outside Japan.
Sales declined in the legacy business of YOHT (Yokohama Off-Highway Tires), which the Company handled as
the ATG (Alliance Tire Group) segment prior to 2022. That decline occurred on account of continuing adverse
conditions in the European and North American markets. The overall sales increase in off-highway tires reflected
the acquisition, completed in May 2023, of the Swedish company Trelleborg Wheel Systems Holding AB. That
company has operated since the acquisition as Y-TWS (Yokohama-TWS).

MB (Multiple Businesses)
Sales revenue totaled ¥101,885 million (+5.9% YoY), accounting for 10.3% of Group consolidated sales revenue.
Segment business profit was ¥7,155 million (+80.5% YoY).
Business volume in hose & couplings was basically unchanged from the previous year. Weak sales of hydraulic
hoses for construction equipment and other applications, undermined by sluggish demand, offset North American
sales growth in automotive hoses. Sales increased strongly in industrial products, as Yokohama Rubber posted
robust growth in Japanese business in conveyor belts and as business expanded in marine products and in
replacement fixtures and components for commercial aircraft.

③Consolidated Earnings Forecast for Fiscal 2024

In fiscal 2024, Japan’s economy is expected to remain in a moderate recovery phase. However, the business
environment remains clouded by uncertainties that could suppress domestic economic growth, such as a slowdown
in demand in overseas manufacturing industries.
Under its new medium-term management plan, Yokohama Transformation 2026 (YX2026), Yokohama Rubber
will further advance the strategies promoted under its previous plan, YX 2023, and continue to strengthen its
management foundation.
As of the preparation of this document, the Company’s forecasts for fiscal 2024 are as shown below. These
forecasts assume the following foreign currency exchange rates: USDJPY 137 and EURJPY 150.

<Full year>
Sales revenue ¥1,060.0 billion
Business profit ¥115.0 billion
Operating profit ¥115.5 billion
Profit attributable to owners of parent ¥74.5 billion
<First half>

Sales revenue ¥500.0 billion

Business profit ¥42.0 billion
Operating profit ¥43.0 billion
Profit attributable to owners of parent ¥25.5 billion

3
(2) Analysis of Consolidated Financial Position
①Analysis of Assets, Liabilities, and Equity
Total assets as of December 31, 2023, were ¥1,600,458 million, an increase of ¥449,382 million from the end of
the previous consolidated fiscal year (December 31, 2022). The increase primarily reflects increases in inventories,
property, plant and equipment, and goodwill due to the acquisition of a new subsidiary.
Total liabilities as of December 31, 2023, were ¥851,663 million, an increase of ¥323,708 million from the end
of the previous consolidated fiscal year. The increase in liabilities primarily reflects an increase in interest-bearing
debt.
Total equity as of December 31, 2023, was ¥748,795 million, an increase of ¥125,674 million from the end of
the previous consolidated fiscal year. The increase primarily reflects an increase in other components of equity.

②Analysis of Cash Flows

Cash and cash equivalents (hereinafter, “cash”) as of December 31, 2023, totaled ¥97,613 million, an increase of
¥22,041 million compared with the end of the previous fiscal year.
(Cash flows from operating activities)
Net cash provided by operating activities totaled ¥159,741 million.
The main contributors were profit before tax of ¥105,975 million and ¥31,643 million in cash generated by a
decrease in inventories.

(Cash flows from investing activities)

Net cash used in investing activities totaled ¥344,015 million.
The main cash outflows were ¥321,928 million in payments for the acquisition of a subsidiary and ¥58,253
million for purchases of property, plant and equipment.

(Cash flows from financing activities)

Net cash provided by financing activities totaled ¥205,760 million.
Net cash provided mainly reflects ¥314,700 million in proceeds from long-term borrowings, which was
partially offset by ¥29,894 million in cash used for repayments of long-term borrowings and a ¥41,646 million
decrease in short-term borrowings.

Trends in cash flow indicators

FY2021 FY2022 FY2023
Ratio of equity attributable to owners of 53.3% 53.4% 46.2%
parent
Ratio of equity attributable to owners of 30.0% 28.7% 32.5%
parent on a market value basis
Debt redemption period 2.6 yrs 6.1 yrs 2.9 yrs

Interest coverage ratio 31.7x 13.6x 26.0x

(Calculation methods)
Ratio of equity attributable to owners of parent: Total equity attributable to owners of parent / Total assets
Ratio of equity attributable to owners of parent on a market value basis: Market capitalization / Total assets
Debt redemption period: Interest-bearing debt / Operating cash flow
Interest coverage ratio: Operating cash flow / Interest payments

4
 Notes:
1) All indicators are calculated using consolidated financial figures
2) Market capitalization is calculated as closing share price at period end × total number of issued shares at
period end (excluding treasury stock)
3) Interest-bearing debt is the sum of all liabilities in the consolidated statement of financial position for which
interest is paid.
4) Operating cash flow is the same as net cash provided by operating activities in the consolidated statement
of cash flows
5) Interest payments is the same as interest paid under “Cash flows from operating activities” in the
consolidated statement of cash flows

(3) Basic Policy for the Appropriation of Profits and Dividends for FY2023 and FY2024
The Company’s basic policy is to maintain stable dividends while securing sufficient internal reserves to support
future business development and fortify its management structure.
In addition, dividends paid from surplus funds are basically distributed twice a year in the form of an interim
dividend and a year-end dividend.
In accordance with the above basic policy, the dividend for fiscal 2023 includes the previously distributed interim
dividend of ¥34 per share and a proposed year-end dividend of ¥50 per share to be distributed following the approval
of shareholders at the 148th Ordinary General Meeting of Shareholders scheduled to be held in March 2024.
If approved, the annual dividend for fiscal 2023 will be ¥84 per share.
For fiscal 2024, the Company plans to pay an annual dividend of ¥93 per share, comprising an interim dividend
of ¥42 per share and a year-end dividend of ¥51 per share.

(4) Risks
Below is a partial listing of risks that could adversely affect the Company’s business performance, financial
position, or share price. All references to possible future events and to other subjects are from the standpoint of the
fiscal year ended December 31, 2023.
① Economic Conditions
Vehicle tires account for most of the Company’s worldwide revenues. Demand for those tires reflects economic
conditions in nations and regions where the Company sells its products. Therefore, economic trends and
developments that diminish demand in the Company’s main markets—including Japan, North America, Europe,
and Asian nations besides Japan—could adversely affect the Company’s business performance and financial
position.

② Exchange Rates
The Company conducts most of its business transactions and investments in yen, but it conducts some
transactions and investments in dollars and in other currencies. The Company continues to expand its operations
globally. That expansion will increase the Company’s exposure to fluctuations in currency exchange rates. The
Company hedges its exposure to currency exchange rates with forward exchange contracts and with other
instruments, but hedging cannot fully offset the effect of fluctuations in currency exchange rates on the Company’s
business performance and financial position.

③ Seasonal Factors
Historically, the Company’s sales and earnings performance has tended to be strongest in the winter months.
That is mainly because sales of winter tires are an important contributor to the Company’s sales and earnings. A
later-than-usual onset of winter or lighter-than-usual snowfall could diminish demand for winter tires and thereby
adversely affect the Company’s business performance and financial position.

5
④ Raw Material Prices
Yokohama Rubber’s principal raw materials are natural rubber and petrochemical products, including synthetic
rubber and carbon black. Sharp increases in prices for natural rubber or for crude oil could raise the Company’s
manufacturing costs. Yokohama employs diverse measures to insulate its business from such increases, but
increases in raw material prices that exceed the scope of those measures could adversely affect the Company’s
business performance and financial position.

⑤ Access to Funding
Instability in any of the world’s principal financial markets could affect the Company’s access to funding
adversely. In addition, the lowering of the Company’s credit rating by leading credit-rating agencies could adversely
affect the Company’s access to debt financing and could increase the Company’s cost of funds. That could adversely
affect the Company’s financial performance and financial position.

⑥ Interest Rates
As of December 31, 2023, the Company’s interest-bearing debt was equivalent to 29.3% of its total assets. An
increase in interest rates could adversely affect the Company’s financial performance and financial position. In
addition, some of the Company’s borrowings are subject to financial limitation clauses.

⑦ Securities
The Company owns marketable securities, mainly Japanese equities. A decline in the value of those securities
could adversely affect the Company’s financial performance and financial position.

⑧ Investment
In response to growing demand for automobile tires, the Company is investing in expanding its tire production
capacity, especially in Asia. Changes in the regulatory environment, in economic conditions, in industrial
circumstances, or in political and social stability in the host nations for the Company’s investment could adversely
affect the Company’s business performance and financial position.

⑨ Corporate Acquisitions and Capital and Business Alliances

The Company sometimes undertakes corporate acquisitions and enters into capital and business alliances to
strengthen its competitive position and fortify its foundation for growth.
On May 2, 2023, the Company completed the acquisition of all outstanding shares of Trelleborg Wheel Systems
Holding AB, turning the company engaged in the manufacture and sale of off-highway tires (OHT) for agricultural
and industrial machinery on a global basis into a subsidiary.
If any business acquired by the Company underperforms the Company’s expectations at the time of the
acquisition, that could occasion impairment loss on goodwill and on other assets and affect the Company’s business
performance and financial position adversely. Such underperformance could result from internal factors or from
unforeseen changes in the business environment or in competitive conditions.

⑩ Retirement Benefit Obligations

The Company calculates retirement benefit obligations and retirement benefit expenses according to
predetermined criteria, including the discount rate and the anticipated return on pension assets. If the actual discount
rate or the actual return on the Company’s pension assets differs substantially from the expected levels, that could
adversely affect the Company’s financial performance and financial position. Such divergence from the expected
levels could occur as a result of a decline in market interest rates, a decline in the valuation of the pension assets, a
decline in return on the pension assets, or changes in the severance payment system or pension system.

6
⑪ Natural Disasters and Terrorist Acts
The Company could suffer direct or indirect damage from earthquakes or other natural disasters, from epidemics,
or from terrorist acts. Management has devoted especially careful attention to the threat posed by natural disasters
and has adopted systematic measures for coping with that threat. However, the occurrence of natural disasters,
epidemics, or terrorist acts in the regions of the Company production sites or principal suppliers could adversely
affect the Company’s business performance and financial position. Also, the Company has addressed the global
spread of the COVID-19 pandemic with thorough measures. That has included emphasizing to employees the
importance of health and safety and of acting to prevent the spread of the COVID-19 pandemic. However, the
further spread of the pandemic or the persistence of the pandemic over the long term could result in the curtailment
or suspension of the Company’s operations in the nations or regions affected. Such a development could adversely
affect the Company’s business performance and financial position.

⑪-2 Pandemics
The Company has addressed the global spread of the COVID-19 pandemic with thorough measures. That has
included emphasizing to employees the importance of health and safety and of acting to prevent the spread of the
COVID-19 pandemic. However, the further spread of the pandemic or the persistence of the pandemic over the
long term could result in the curtailment or suspension of the Company’s operations in the nations or regions
affected. Such a development could adversely affect the Company’s business performance and financial position.

⑪-3 Geopolitical Risks Posed by Situations in Ukraine and Middle East

Given the impact from the situation in Ukraine, decisions about production at the Company’s passenger car tire
manufacturing subsidiary in Russia are being made while closely monitoring the situation. Future developments
and the Company’s response could adversely affect the Company’s business performance and financial position.
In addition, further deterioration of situation in the Middle East could hamper corporate activities and logistics in
countries in the region where the Company has operations. Such a development could adversely affect the
Company’s business performance and financial position.

⑫ Intellectual Property
The Company strives to protect its accumulated technological expertise from unauthorized use by third parties
and its intellectual property rights from infringement, but it could, in some circumstances, be unable to prevent
such unauthorized use or infringement. Conversely, third parties could claim that the Company’s products or
technologies infringe on their intellectual property rights. Unauthorized use of the Company’s technological
expertise, infringement of its intellectual property, or court rulings that its products or technologies infringe on
third-party intellectual property rights could adversely affect the Company’s business performance and financial
position.

⑬ Product Quality
Management at the Company is committed to ensuring high and consistent product quality and maintains a
framework and procedures for fulfilling that commitment, but product defects could occur despite the Company’s
best efforts in prevention. The occurrence of defects serious enough to occasion large product recalls could
adversely affect the Company’s business performance and financial position.

7
 ⑭ Laws, Regulations, and Litigation
The Company is subject to laws and regulations in the nations where it conducts business that pertain to such
activities as investment, trade, currency exchange, exports, competition, personal information safeguarding, and
environmental protection. The imposition of new laws or regulations in Japan or overseas or unexpected changes
in laws or regulations that result in constraining the Company’s operating latitude or in raising the Company’s costs
could adversely affect the Company’s business performance and financial position. In addition, the Company could
become the subject of litigation or of investigations by legal authorities in the nations where it operates. Serious
litigation or the initiation of an investigation of the Company by legal authorities could adversely affect the
Company’s business performance and financial position.

2. Management Policies
(1) Yokohama Rubber’s Basic Management Policies
By applying the basic management policies listed below, the Company aims to realize its fundamental corporate
philosophy—“To enrich people’s lives and contribute to their greater happiness and well-being by devoting our
wholehearted energies and advanced technology to the creation of beneficial products.”
・Take on the challenge of new technologies to create new value.
・Develop proprietary business fields to expand the scope of business
・Create a workplace that values, improves and energizes people.
・Deal fairly with society and value harmony with the environment.

(2) Key Management Performance Indicators Established as Targets in the Company’s Current Medium-term
Management Plan
The Company will implement measures to achieve the following financial targets set forth in its medium-term
management plan to be implemented from fiscal 2024 to fiscal 2026.

Sales revenue ¥1,150 billion

Business profit ¥130 billion
Business profit margin 11%
Equity ratio 50％ target
ROE Above 10%
Operating cash flow ¥385 billion
(3 years cumulative）
Within scope of depreciation
Capital investment (excluding strategic
investments)

(3) Company’s Medium-to-Long-term Management Strategies and Issues to be Addressed

Yokohama Rubber Group announced its new medium-term management plan, Yokohama Transformation 2026
(YX2026). The new plan will be implemented over the next three years, 2024–2026, as the successor to
Yokohama Transformation 2023 (YX2023), which guided the Company over the past three years, 2021–2023.
Under YX2026, Yokohama Rubber will further advance the “exploitation” of the strengths of its existing
businesses and the “exploration” of new value and complete the transformation begun under YX2023 while being
mindful to not leave any negative legacies for the next generation. Under this guiding philosophy, management
will resolutely implement the growth strategies established in each business as it aims to achieve “Hockey Stick
Growth” during YX2026 to fiscal 2027. Management’s targets for fiscal 2026, the final year of YX2026, are sales
revenue of ¥1,150 billion, business profit of ¥130 billion, a business profit margin of 11%, and ROE of more than
10%.
Strategies for each business and management domain are as follows:
8
 ■ Consumer Tires
In the consumer tire market, recent years have seen low-cost, low-price emerging tire makers expand their
production capacity and increase their market share. In response, during YX2026 Yokohama Rubber will accelerate
its efforts to maximize the sales ratio of its high-value-added tires as it aims to increase the profitability of its
consumer tire business. In addition, the consumer tire business has initiated the “1-year plant” challenge, which
aims to bring new plants on line within one year and achieve the low cost and high efficiency needed to compete
with the cost-competitiveness of emerging tire makers and achieve “Hockey Stick Growth”. As part of its effort to
maximize the sales ratio of high-value-added tires and enhance brand value, the consumer tire business will promote
its tires as original equipment (OE) for premium cars and continue its participation in motorsports events around
the world. It also will continue its “Product and Regional Strategies” focused on strengthening the development,
supply, and sales of tires that respond to specific trends in each regional market.

■ Commercial Tires
OHT business
Current OHT global market size is about ¥4 trillion and is expected to grow 6% a year, considerably higher than
the projected 2% annual growth for the consumer tire market. Agriculture and forestry machinery is estimated to
account for about 40% of the global OHT market. The Yokohama Rubber Group has the top share in this market
segment and plans to strengthen its market position by implementing a multi-brand strategy that will leverage its
production, sales, and technology strengths in all three tiers of this market segment. The Yokohama Rubber Group
currently has the second largest share of the global market for industrial and port-use machinery, which is
estimated to account for about 25% of the OHT market. During YX2026, the Group will further expand the global
operation of its Interfit tire maintenance service provided by highly specialized staff into new countries. As part
of its effort to realize “Hockey Stick Growth,” Yokohama Rubber will consider programmatic M&A as a measure
to boost its as yet rather small shares in the global markets for construction and mining machinery and further
strengthen its OHT business. In addition to further increasing OHT production capacity, the entire Yokohama
Rubber Group will strengthen efforts to generate synergies made possible by the May 2023 acquisition of
Trelleborg Wheel Systems (currently Yokohama-TWS=Y-TWS).

TBR business
Truck and bus tires are another area where emerging tire makers are expanding production capacity and seek to
increase their supply in markets around the world. However, this effort is being met by antidumping and
countervailing duties in Europe and the United States. Yokohama Rubber will aim for profitable growth by
strengthening sales in countries and regions where these measures are supporting the maintenance of appropriate
pricing.

■MB Business
During YX2023, the MB Business implemented business restructuring and profit-improvement measures that
have established a new business platform that will generate strong revenues during YX2026. The hose & couplings
business is positioned as a growth driver during YX2026 and will restructure its value chain and North American
production network in order to fulfill that role. The industrial products business will solidify its leading share in
Japan’s conveyor belt market and undertake internal reforms to establish a more stable high-profit structure in its
marine hose operations. The MB Business as a whole aims to achieve a 10% business profit margin in fiscal 2026
and elevate its presence within the Yokohama Rubber Group.

9
 ■Technology & Production
During YX2026, Yokohama Rubber will implement technology and production strategies based on a moto of
“Low cost, speedy development of quality products” that will strengthen the entire Yokohama Rubber Group.
“Quality products” refers to strengthening development of OE tires suitable for the next-generation of premium
cars. “Low cost” refers to efforts to drastically reduced costs that can’t be beat by other companies, and “Speedy”
refers to the “1-year plant” challenge that is the centerpiece of the consumer tire strategy aimed at achieving
“Hockey Stick Growth” and its efforts to speed up tire development.

■Sustainability
Yokohama Rubber considers sustainability activities an important corporate activity that should contribute to the
Company’s growth. For that reason, management will give serious consideration to environment-related
investments that also contribute to corporate earnings. One example is the new plan under YX2026 to reduce the
Group’s 2019-level Scope 1 & 2 emissions of greenhouse gases by 30% by 2026 and 40% by 2030 while also
reducing costs. Also, to reduce Scope 3 emissions, Yokohama Rubber will promote greater use of sustainable
materials and has targeted increasing its sustainable materials ratio to 28% in 2026 and 30% in 2030. However,
during YX2026 it will consider raising the 2030 target to 40% without incurring any cost increases.

■Financial Strategy
During YX2026, Yokohama Rubber will continue to aggressively pursue strategic investments aimed at realizing
“Hockey Stick Growth” and enhancing corporate value. The Company also will continue unwinding cross-
shareholdings as a measure to improve asset efficiency and will implement measures to create a capital structure
with an optimal balance of debt and equity that fits its business structure (aiming for an equity ratio of 50%). To
raise PER, management will conduct more IR events and endeavor to reduce the cost of capital and raise expected
growth rate by increasing information disclosures and deepening dialogue with investors. Regarding capital
allocation during YX2026, the plan is to allocate about ¥320 billion of the estimated three-year ¥450 billion increase
in cash to strategic investments and investments in ongoing operations. Lastly, regarding shareholder returns,
Yokohama Rubber aims to stably and steadily raise its dividend in accordance with its basic policy of maintaining
stable dividends while securing sufficient internal reserves to support its business development and fortify its
financial position while continuing to actively invest in sustainable profit growth.

3. Basic Policy on the Selection of Accounting Standard

To establish unified financial reporting using standardized financial information among its Group companies
around the world and to enhance the international comparability of its financial information presented to the capital
markets, the Company has applied the International Financial Reporting Standards (IFRS) in its consolidated
financial statements since the issuance of its annual securities report (yukashoken hokokusho) for the fiscal year ended
December 2017.

10
4. Consolidated Financial Statements and Principal Notes
(1) Consolidated Statement of Financial Position
(Millions of yen)

As of December 31, 2022 As of December 31, 2023

Assets
Current assets
Cash and cash equivalents 75,572 97,613
Trade and other receivables 193,749 243,393
Other financial assets 3,594 6,217
Inventories 216,392 249,721
Other current assets 14,673 21,160
Total current assets 503,980 618,105

Non-current assets
Property, plant and equipment 372,933 492,796
Goodwill 104,244 275,830
Intangible assets 37,168 73,013
Other financial assets 112,804 104,812
Deferred tax assets 8,140 9,141
Other non-current assets 11,808 26,761
Total non-current assets 647,097 982,353
Total assets 1,151,076 1,600,458

11
 (Millions of yen)

As of December 31, 2022 As of December 31, 2023

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables 78,131 105,239
Bonds and borrowings 117,480 96,135
Other financial liabilities 24,470 28,989
Income taxes payable 8,581 38,085
Other current liabilities 65,846 79,441
Total current liabilities 294,508 347,889

Non-current liabilities
Bonds and borrowings 121,221 373,221
Other financial liabilities 36,901 41,497
Liabilities for retirement benefits 15,584 17,707
Deferred tax liabilities 48,702 58,856
Other non-current liabilities 11,038 12,494
Total non-current liabilities 233,447 503,774
Total liabilities 527,955 851,663

Equity
Share capital 38,909 38,909
Share premium 31,308 31,255
Retained earnings 432,224 510,004
Treasury shares (11,650) (11,587)
Other components of equity 123,633 170,983
Total equity attributable to owners of the parent 614,424 739,565
Non-controlling interests 8,698 9,231
Total equity 623,121 748,795
Total liabilities and equity 1,151,076 1,600,458

12
(2) Consolidated Statement of Profit or Loss and Consolidated Statement of Comprehensive Income
Consolidated Statement of Profit or Loss
(Millions of yen)
For the fiscal year ended For the fiscal year ended
December 31, 2022 December 31, 2023
Sales revenue 860,477 985,333
Cost of sales (572,803) (659,442)
Gross profit 287,674 325,891
Selling, general, and administrative expenses (217,585) (226,764)
Business profit 70,089 99,127
Other income 2,266 7,559
Other expenses (3,504) (6,335)
Operating profit 68,851 100,351
Finance income 10,341 12,764
Finance costs (7,571) (7,140)
Profit before tax 71,622 105,975
Income taxes (24,473) (37,545)
Profit 47,149 68,430

Profit attributable to:

Owners of the parent 45,918 67,234
Non-controlling interests 1,231 1,197
Profit 47,149 68,430

Basic earnings per share (yen) 286.38 419.32

Diluted earnings per share (yen) 285.80 418.31

13
Consolidated Statement of Comprehensive Income
(Millions of yen)
For the fiscal year ended For the fiscal year ended
December 31, 2022 December 31, 2023

Profit 47,149 68,430

Other comprehensive income

Items that will not be reclassified subsequently to
profit or loss
Gains (losses) on financial assets measured at fair
(2,281) 14,469
value through other comprehensive income
Remeasurements of defined benefit plans 1,131 6,794

Items that may be reclassified subsequently to profit or

loss
Cash flow hedges (1,253) (1,388)
Exchange differences on translating foreign
56,358 49,128
operations

Total other comprehensive income, net of tax 53,955 69,002

Comprehensive income 101,104 137,432

Comprehensive income attributable to:

Owners of the parent 99,561 135,926
Non-controlling interests 1,542 1,507
Comprehensive income 101,104 137,432

14
(3) Consolidated Statement of Changes in Equity
Fiscal Year Ended December 31, 2022
(Millions of yen)
Equity attributable to owners of the parent
Other components of equity
Exchange
Share capital Share premium Retained earnings Treasury shares differences on
Cash flow hedges
translating foreign
operations
Balance, January 1, 2022 38,909 31,261 391,949 (11,758) 16,790 2,336
Profit 45,918
Other comprehensive income 56,063 (1,253)
Comprehensive income – – 45,918 – 56,063 (1,253)
Purchase of treasury shares (2)
Disposal of treasury shares 0 0
Share-based payment
27 110
transactions
Dividends from surplus (10,603)
Transactions with non-
controlling interests in
20
subsidiaries that do not
result in a loss of control
Transfer to retained earnings 4,962
Others (1)
Total transactions with
– 47 (5,643) 108 – –
owners
Balance, December 31, 2022 38,909 31,308 432,224 (11,650) 72,854 1,083

Equity attributable to owners of the parent

Other components of equity
Gains (losses) on
financial assets Total equity Non-controlling
attributable to Total equity
measured at fair Remeasurements of interests
value through defined benefit Total owners of the
other plans parent
comprehensive
income
Balance, January 1, 2022 55,825 – 74,952 525,312 7,646 532,958
Profit – 45,918 1,231 47,149
Other comprehensive income (2,283) 1,115 53,643 53,643 312 53,955
Comprehensive income (2,283) 1,115 53,643 99,561 1,542 101,104
Purchase of treasury shares – (2) (2)
Disposal of treasury shares – 0 0
Share-based payment
– 137 137
transactions
Dividends from surplus – (10,603) (573) (11,177)
Transactions with non-
controlling interests in
– 20 (55) (35)
subsidiaries that do not
result in a loss of control
Transfer to retained earnings (3,847) (1,115) (4,962) – –
Others – (1) 138 137
Total transactions with
(3,847) (1,115) (4,962) (10,450) (490) (10,940)
owners
Balance, December 31, 2022 49,695 – 123,633 614,424 8,698 623,121

15
 Fiscal Year Ended December 31, 2023
(Millions of yen)
Equity attributable to owners of the parent
Other components of equity
Exchange
Share capital Share premium Retained earnings Treasury shares differences on
Cash flow hedges
translating foreign
operations
Balance, January 1, 2023 38,909 31,308 432,224 (11,650) 72,854 1,083
Profit 67,234
Other comprehensive income 48,821 (1,388)
Comprehensive income – – 67,234 – 48,821 (1,388)
Purchase of treasury shares (4)
Disposal of treasury shares 1
Share-based payment
79 68
transactions
Dividends from surplus (10,768)
Transactions with non-
controlling interests in
(133)
subsidiaries that do not
result in a loss of control
Transfer to retained earnings 21,342
Others (28)
Total transactions with
– (52) 10,546 63 – –
owners
Balance, December 31, 2023 38,909 31,255 510,004 (11,587) 121,674 (305)

Equity attributable to owners of the parent

Other components of equity
Gains (losses) on
financial assets Total equity Non-controlling
attributable to Total equity
measured at fair Remeasurements of interests
value through defined benefit Total owners of the
other plans parent
comprehensive
income
Balance, January 1, 2023 49,695 – 123,633 614,424 8,698 623,121
Profit – 67,234 1,197 68,430
Other comprehensive income 14,461 6,799 68,692 68,692 310 69,002
Comprehensive income 14,461 6,799 68,692 135,926 1,507 137,432
Purchase of treasury shares – (4) (4)
Disposal of treasury shares – 1 1
Share-based payment
– 147 147
transactions
Dividends from surplus – (10,768) (961) (11,730)
Transactions with non-
controlling interests in
– (133) (13) (145)
subsidiaries that do not
result in a loss of control
Transfer to retained earnings (14,542) (6,799) (21,342) – –
Others – (28) (28)
Total transactions with
(14,542) (6,799) (21,342) (10,785) (974) (11,759)
owners
Balance, December 31, 2023 49,614 – 170,983 739,565 9,231 748,795

16
(4) Consolidated Statement of Cash Flows
(Millions of yen)
For the fiscal year ended For the fiscal year ended
December 31, 2022 December 31, 2023
Cash flows from operating activities
Profit before tax 71,622 105,975
Depreciation and amortization 49,914 59,494
Impairment losses 285 2,296
Increase (decrease) in liabilities for retirement benefits (267) (322)
Interest and dividend income (5,021) (5,244)
Interest expenses 2,939 6,300
Loss (gain) on sale and retirement of non-current assets 78 12
Decrease (increase) in trade receivables (11,733) (1,172)
Increase (decrease) in trade payables 5,983 (6,194)
Decrease (increase) in inventories (47,682) 31,643
Gain on sale of businesses – (3,316)
Other (571) (4,530)
Subtotal 65,547 184,944
Interests and dividends received 5,017 5,236
Interests paid (2,890) (6,155)
Income taxes (paid) refund (28,444) (24,284)
Net cash provided by operating activities 39,231 159,741

Cash flows from investing activities

Proceeds from withdrawal of time deposits 2,283 5,868
Payments into time deposits – (8,944)
Purchases of property, plant and equipment (54,378) (58,253)
Proceeds from sale of property, plant and equipment 2,072 2,969
Purchases of intangible assets (514) (473)
Purchases of investment securities (326) (612)
Proceeds from sale of investment securities 7,340 29,863
Proceeds from sale of businesses – 5,386
Payments for acquisition of subsidiaries, net of cash and – (321,928)
cash equivalents acquired
Other (2,834) 2,108
Net cash used in investing activities (46,357) (344,015)

Cash flows from financing activities

Net increase (decrease) in short-term borrowings 34,460 (41,646)
Net increase (decrease) in commercial paper 7,000 (7,000)
Proceeds from long-term borrowings 13,524 314,700
Repayments of long-term borrowings (19,494) (29,894)
Proceeds from issuance of bonds 30,000 –
Redemption of bonds (12,000) (9,000)
Purchases of treasury shares 108 (4)
Proceeds from sale of treasury shares 27 148
Cash dividends paid (10,603) (10,767)
Other (7,849) (10,777)
Net cash provided by (used in) financing activities 35,172 205,760

Effect of exchange rate changes on cash and cash equivalents 5,003 555
Net increase in cash and cash equivalents 33,049 22,041
Cash and cash equivalents at the beginning of period 42,523 75,572
Cash and cash equivalents at the end of period 75,572 97,613

17
(5) Notes Concerning Consolidated Financial Statements
(Notes on going concern assumption)
Not applicable.

(Segment information)
(1) Outline of Reportable Segments
The Group’s business segments are organizational units for which the Group is able to obtain discrete financial
information in order for the Company’s Board of Directors to regularly review performance to determine the
distribution of management resources and evaluate business results.
The Group classifies organizational units by product and service. Each organizational unit plans domestic or
overseas general strategies for its products and services and operates its business.

Major products in each reportable segment

Reportable segment Major products
Tires for passenger cars, trucks and buses, light trucks, agricultural machinery,
Tires construction equipment, industrial equipment, forestry machinery, etc.; various tire tubes;
aluminum alloy wheels; and auto supplies
Conveyor belts, various hoses, pneumatic marine fenders, oil fences, marine hoses, and
MB
aerospace products

18
(2) Information on Segment Revenues and Results
The figures related to reportable segments are based on business profit. Intersegment revenues are based on
prevailing market prices.

For the fiscal year ended December 31, 2022 (from January 1, 2022 to December 31, 2022)
(Millions of yen)
Reportable segment
Others Adjustment
Total Consolidated
(Note 1) (Note 3)
Tires MB

Sales revenue
Sales revenue from external
754,309 96,248 9,919 860,477 – 860,477
customers
Intersegment revenue 1,212 146 10,465 11,823 (11,823) –
Total 755,521 96,394 20,384 872,300 (11,823) 860,477
Segment profit (business profit)
66,843 3,965 (758) 70,050 40 70,089
(Note 2)
Other income and expenses (1,238)
Operating profit 68,851
(Other significant items)
Depreciation and amortization 37,777 2,964 101 40,841 1,042 41,883
Impairment losses 247 38 – 285 – 285
Capital expenditures 48,678 3,895 332 52,904 2,038 54,942
Notes: 1. “Others” includes the sports business.
2. Segment profit (business profit) is calculated by deducting cost of sales and selling, general, and
administrative expenses from sales revenues.
3. Segment profit adjustments include the elimination of intersegment transactions.
4. Depreciation and capital expenditures for right-of-use assets are not included.

19
For the fiscal year ended December 31, 2023 (from January 1, 2023 to December 31, 2023)
(Millions of yen)
Reportable segment
Others Adjustment
Total Consolidated
(Note 1) (Note 3)
Tires MB
Sales revenue
Sales revenue from external
874,863 101,885 8,585 985,333 – 985,333
customers
Intersegment revenue 1,196 103 12,395 13,694 (13,694) –
Total 876,059 101,988 20,980 999,026 (13,694) 985,333
Segment profit (business profit)
92,026 7,155 (76) 99,105 22 99,127
(Note 2)
Other income and expenses 1,224
Operating profit 100,351
(Other significant items) (Note 4)
Depreciation and amortization 45,871 3,020 119 49,010 838 49,848
Impairment losses 6 2,290 – 2,296 – 2,296
Capital expenditures 55,145 5,383 292 60,821 1,592 62,412
Notes: 1. “Others” includes the sports business.
2. Segment profit (business profit) is calculated by deducting cost of sales and selling, general, and
administrative expenses from sales revenues.
3. Segment profit adjustments include the elimination of intersegment transactions.
4. Depreciation and capital expenditures for right-of-use assets are not included.

(3) Revenue from External Customers by Product and Service Category

Disclosure is omitted because product and service categories are the same as the reportable segments.

(4) Geographic Information

Non-current assets
(Millions of yen)

As of December 31, 2022 As of December 31, 2023

Japan 151,277 167,475

United States of America (“USA”) 57,925 73,552

India 184,280 208,985

China 32,432 37,452

Philippines 29,944 28,372

Europe 19,743 266,086

Others 44,954 70,377

Total 520,555 852,299

Note: Non-current assets are classified based on the location of each company in the Group. They exclude other financial
assets, assets for retirement benefits, and deferred tax assets.

(5) Information on Major Customers

There was no single external customer that accounted for 10% or more of revenue on the consolidated statement
of profit or loss.

20
(Earnings per share)
(Millions of yen)
For the fiscal year ended For the fiscal year ended
December 31, 2022 December 31, 2023
Profit attributable to owners of the parent 45,918 67,234

(Thousands of shares)
For the fiscal year ended For the fiscal year ended
December 31, 2022 December 31, 2023
Weighted-average number of common stock 160,339 160,340
Share-based payment 327 388
Weighted-average number of diluted common stock 160,666 160,728

(Yen)
For the fiscal year ended For the fiscal year ended
December 31, 2022 December 31, 2023
Basic earnings per share 286.38 419.32
Diluted earnings per share 285.80 418.31

(Significant subsequent events)

Not applicable.

21