Pretoria - Profit at Bridgestone Firestone Maxiprest, the listed retreader, new tyre distributor and tyre management service provider, was down by R27 million for the year to December.
This drop was attributed to charges related to the rand's strengthening, the turmoil in Zimbabwe and provisions made for losses by an associate firm.
The company yesterday reported a 52 percent slump in earnings a share to 15.1c from 31.2c in the previous year despite turnover rising by 24 percent to R1.38 billion.
The poor results were expected after Bridgestone issued a profit warning in January.
An increased tax charge at an effective rate of 39.8 percent compared with 30.2 percent also affected earnings. The increased charge arose because assessed losses were fully used in 2001.
Gross profit increased by more than 20 percent to R384.99 million, but attributable earnings declined by 51 percent to R23.96 million.
Net cash flow from operating activities improved by 426 percent to R61.1 million. A final dividend of 5c a share was declared, increasing the total dividend for the year to 10c compared with 11c in the previous year.
Colin Brown, Bridgestone's managing director, said the appreciation of the rand at the end of last year necessitated a revision of the value of mainly dollar-based receivables from foreign operations, which required a write-down of R5.4 million compared with a R7.7 million profit in 2001.
Brown said Roadgrip Afrityre Holdings, an associate company in which the group has a 40 percent holding, showed an accumulated loss of R13 million.
The group had accounted for the loss by charging R6.1 million against earnings, with a further provision of R7.8 million raised against the possible non-recovery of receivables.
The Zimbabwe operation, which was previously 56.7 percent owned but became a wholly owned subsidiary effective from January last year, produced a non-consolidated hyper-inflationary loss of R4.1 million compared with an R8.5 million profit the year before.
However, dividends received from the Zimbabwean operation increased to R3.3 million from R1.7 million.
Brown said the Zimbabwe operation had not been consolidated because of political and economic uncertainty in the country and the anticipated restrictions on the remitability of funds.
The firm's stock closed 1c down at R1.50 yesterday.