I. Introduction
The world's largest tire
and rubber company, Bridgestone, was established on March 1, 1931 with Mr.
Shojiro Ishibashi as the founder. As a big enterprise, Bridgestone has achieved
sustainable condition not only in operation but also in financial condition. As
of December 31, 2015, the paid-in capital of the company reached up JPY126,354
million with 144,303 total employees
Based on the achievement
in producing, Bridgestone is a worldwide enterprise that has manufacturing
plant in Americas, Europe, Middle East Africa, Russia, China/Asia Pacific, and
also Japan. The number of manufacturing plants as of April 1, 2016 are 54 on
Americas; 19 on Europe/Middle East Africa/Russia; 42 on China/Asia Pacific; and
51 in Japan. The big number of manufacturing plants also supported by the
number of research and development facilities that 6 technical center and 10
proving ground around the Bridgestone manufacturing plants countries
II. Financial Performance
The achievement of the company
performance related to Bridgestone’s assets, equity, and profit margins,
reflected in a financial performance during last five years in table 1 below
|
2011 |
2012 |
2013 |
2014 |
2015 |
Total Assets
(Hundred Millions Yen) |
26,773 |
30,397 |
35,770 |
39,609 |
37,958 |
Asset Turnover |
1.12 |
1.06 |
1.08 |
0.97 |
0.98 |
ROA |
3.8 |
6.0 |
6.1 |
8.0 |
7.3 |
Net Assets (Hundred
Millions Yen) |
11,656 |
14,173 |
18,629 |
21,466 |
22,820 |
ROE |
9.1 |
13.7 |
12.7 |
15.5 |
13.3 |
Net Profit Margin |
3.4 |
5.6 |
5.7 |
8.2 |
7.5 |
Table.
1 Performance related to Bridgestone’s Assets
On 2011, Bridgestone’s assets reached
26,773 hundred million JPY and rise 41.78% on 2015, become 37,958 hundred
million JPY. This performance link with 25.32% the sales growth rate, from
30,243 hundred million JPY on 2011 become 37,902 hundred million JPY and has a significant
impact an increase in total value assets. For the equity performance, on 2011
Bridgestone’s return on equity was 9.1 that rises 13.3 on 2015. Return on
equity (ROE) is the amount of net income
returned as a percentage of shareholders
equity. Return on equity
measures a corporation's profitability by revealing how much profit a company
generates with the money shareholders have invested
Also for the company performance related
to cash flow, reflected in a financial performance during last five years in table
2 below
(bil. Yen) |
2011 |
2012 |
2013 |
2014 |
2015 |
Operating Cash flow |
152.1 |
404.4 |
471.7 |
428.6 |
553.9 |
Investment Cash
flow |
(177.0) |
(237.9) |
(265.2) |
(305.6) |
(233.3) |
Free Cash flow |
(24.9) |
166.5 |
206.5 |
122.9 |
320.5 |
Table.2
Bridgestone’s Cash flow
From the table above, Bridgestone’s cash flow climb significantly from the company financial performance that reaches high profit during five years. The better ability on managing cash fund show when Bridgestone reach free cash flow from 122.9 billion JPY on 2014, to 320 billion JPY on 2015.
III. Effect of Bridgestone Operation in Indonesia
Bridgestone has two new tire plants, two
raw material plants, and one diversified product plants in Indonesia. This is a
good investment that Bridgestone have done in Indonesia, because Indonesia is
the second largest rubber producer. As the second-largest rubber producer,
Indonesia supplies a substantial amount of rubber to the global market
(in million tons) |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
Production |
2.75 |
2.44 |
2.73 |
3.09 |
3.04 |
3.20 |
3.18 |
3.11 |
Export |
2.30 |
1.99 |
2.20 |
2.55 |
2.80 |
2.70 |
2.60 |
2.30 |
Table.3
Indonesian Rubber Production & Export
Around 85 percent of Indonesia's rubber
production is exported. Almost half of export is shipped to other Asian
countries, followed by North America and Europe. The top five Indonesian rubber
importing countries are the United State of America, China, Japan, Singapore,
and Brazil. Domestic rubber consumption is mostly absorbed by Indonesia's
manufacturing industries (in particular the automotive sector)
The massive rubbers demand to trigger
Indonesia’s smallholder farmers to fulfill the demand by increasing rubbers
supply. They cultivate more for rubber planting, consequently, the rubber
planting area has expanded. It has a significant effect on forest conversion
and intensive agriculture in Indonesia. The introduction of rubber by swidden
agriculturalists actually had a positive effect on reforestation and therefore
on the total forest landscape. Many farmers combine conversion of tropical
forests for agriculture with the active creation of forests, such as
structurally complex and floristically diverse forest garden
IV. Conclusions
Tire become most needed goods on construction
and mining vehicles, industrial machinery, agricultural machinery, aircraft,
motorcycles and scooters, tire-related product, and sporting. With the
worldwide manufacturing plants, as the world's largest tire and rubber company,
Bridgestone become the major company to conclude the tire and tire tubes. Bridgestone
has a satisfactory financial condition with a prime financial performance. The
company have increased net profit and satisfied performances.
The Bridgestone’s manufacturing plants that have opened in Indonesia have positive socio-economics effect. The high demand of rubbers, generate smallholder farmers to cultivate rubber plants, which have a positive effect on reforestation and environment, farmers economics, and Indonesia’s growth.
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