DENSO Announces First-half Financial Results

DENSO Announces First-half Financial Results

KARIYA (Japan) DENSO Corporation today announced global financial results for the first half of the fiscal year, which ended Sept. 30, 2011:

  • Consolidated net sales totaled 1,409.1 billion yen (US$18.4 billion), an 11.4 percent decrease from the previous year.
  • Consolidated operating income totaled 31.9 billion yen (US$415.6 million), a 74.4 percent decrease from the previous year.
  • Consolidated net income totaled 23.3 billion yen (US$303.8 million), a 75.2 percent decrease from the previous year.

”Despite the recovery in car production from the Great East Japan Earthquake in the second quarter, the sharp production decline in the first quarter led to a decrease in both sales and income,” said Nobuaki Katoh, president and CEO of DENSO Corporation.

In Japan, in spite of the production recovery, which was earlier than expected, the low production level in the first quarter led to a decrease in sales totaling 963.5 billion yen (US$12.6 billion), a 10.8 percent decrease from the previous year. Decreases in production volume resulted in an operating income of 1.7 billion yen (US$22.2 million), a 97.1 percent decrease from the previous year.

In North America, despite the market recovery of the auto industry, the production decreases of the Japanese auto manufacturers led to a decrease in sales to 217.5 billion yen (US$2.8 billion), a 20.7 percent decrease from the previous year. As a result of the decrease in production volume, the operating loss totaled 3.0 billion yen (US$39.6 million), a decrease of 17.1 billion yen (US$223.7 million) from the previous year.

In Europe, an increase in sales mainly to European auto manufactures led to an increase in sales to 198.7 billion yen (US$2.6 billion), a 2.6 percent increase from the previous year. The deteriorating effects of product composition change led to the operating income of 3.3 billion yen (US$43.1 million), a 38.7 percent decrease from the previous year.

In Asia and Oceania, the decrease in Japanese auto manufactures’ car production resulted in sales decrease to 299.7 billion yen (US$3.9 billion), a 6.6 percent decrease from the previous year. The decrease in production volume led to the operating income of 26.3 billion yen (US$342.9 million), a 41.1 percent decrease from the previous year.

In other areas, mainly the South American region, including countries such as Brazil and Argentina, sales totaled 30.4 billion yen (US$397.1 million), a 1.9 percent decrease from the previous year, and operating income totaled 2.0 billion yen (US$26.0 million), a 50.3 percent decrease from the previous year.

  “Although substantial increase in production volume is expected in the second-half, we have made a downward revision to our year-end sales forecast considering future business conditions such as exchange loss due to the appreciating yen,” said Katoh.

Forecast for Fiscal Year Ending March 31, 2012

 

FY Forecast

(Original)

FY Forecast

(Revised)

Changes from Previous FY

Net Sales

3,170.0 billion yen

[US$41.4 billion]

3,160.0 billion yen

[US$41.2 billion]

+28.5 billion yen

(0.9 percent)

Operating income

135.0 billion yen

[US$ 1.8 billion]

135.0 billion yen

[US$1.8 billion]

-53.3 billion yen

(-28.3 percent)

Income before income taxes and minority interests

145.0 billion yen

[US$1.9 billion]

145.0 billion yen

[US$1.9 billion]

-66.7 billion yen

(-31.5 percent)

Net income

98.0 billion yen

[US$1.3 billion]

98.0 billion yen

[US$1.3 billion]

-45.1 billion yen

(-31.5 percent)

 

“DENSO has four production bases in Thailand, but none have suffered flooding at this time,” said Katoh. “We are supporting our suppliers in Thailand and considering alternative procurement to minimize the affect to our productions. The impact of the Thailand flooding can not be assessed at this time and is not included in the financial forecast. ”

DENSO Corporation, headquartered in Kariya, Aichi prefecture, Japan, is a leading global automotive supplier of advanced technology, systems and components in the areas of thermal, powertrain control, electric, electronics and information and safety. Its customers include all the world’s major carmakers. Worldwide, the company has more than 200 subsidiaries and affiliates in 35 countries and regions (including Japan) and employs approximately 120,000 people. Consolidated global sales for the fiscal year ending March 31, 2011, totaled US$37.7 billion. Last fiscal year, DENSO spent 9.3 percent of its global consolidated sales on research and development. DENSO common stock is traded on the Tokyo and Nagoya stock exchanges.For more information, go to www.globaldenso.com, or visit our media website at www.densomediacenter.com.

(Notes)

U.S. dollar amounts have been translated, for convenience only, at the rate of 76.65yen = US$1, the approximate exchange rate prevailing in the Tokyo Foreign Exchange Market on September 30, 2011. Billion is used in the American sense of one thousand million.