DENSO : Announces First-half Financial Results

KARIYA (Japan) ―DENSO, the world's second largest mobility supplier, today announced its global financial results for the first half ending September 30, 2019 for fiscal year ending March 31, 2020:

• Consolidated revenue totaled 2,618.4 billion yen (US$24.3 billion), a 0.2 percent decrease from the previous year.
• Consolidated operating profit totaled 134.0 billion yen (US$1.2 billion), a 12.0 percent decrease from the previous year.
• Consolidated profit attributable to owners of the parent company totaled 104.2 billion yen (US$965.7 million), an 8.6 percent decrease from the previous year.

DENSO revenue, not including foreign exchange fluctuations, increased due to car production growth in Japan and North America despite market slowdown in Asia, mainly in China and India. However, with foreign exchange fluctuations included, it led to a drop in overall revenue. In spite of production volume increase and variable cost reduction, operating profit decreased due to DENSO's increased investment for future growth, as well as currency exchange loss,' said Yasushi Yamanaka, executive vice president of DENSO Corporation.

In Japan, an increase in vehicle production by Toyota led to an increase in revenue to 1,626.0 billion yen (US$15.1 billion), a 3.4 percent growth from the previous year. Operating profit increased to 56.4 billion yen (US$522.6 million), a 5.9 percent up from the previous year due to a rise in production volume and cost-reduction efforts.

In North America, despite a production volume increase and sales expansion, currency exchange loss led to a decrease in revenue to 603.5 billion yen (US$5.6 billion), a 0.1 percent decrease from the previous year. Operating profit totaled 11.2 billion yen (US$103.9 million), a 27.6 percent decrease from the previous year due to the increase in expenses for R&D and investments to expand electrification production capabilities.

In Europe, revenue totaled 295.0 billion yen (US$2.7 billion), an 11.3 percent decrease from the previous year due to market slowdown. Production volume decrease and currency exchange loss led a drop in operating profit to 6.3 billion yen (US$58.7 million), a 33.9 percent decrease from the previous year.

In Asia, market slowdown led to a drop in revenue to 660.0 billion yen (US$6.1 billion), an 8.1 percent down from the previous year. Operating profit totaled 50.4 billion yen (US$467.3 million), a 25.7 percent decrease from the previous year. This is attributed to production volume decrease and currency exchange loss.

In other areas, mainly the South American region, specifically Brazil and Argentina, revenue totaled 34.5 billion yen (US$319.9 million), a 0.1 percent decrease from the previous year. Operating profit totaled 6.3 billion yen (US$58.1 million), a 13.4 percent increase from the previous year.

'Considering the market slowdown and impact of currency exchange fluctuations, we have revised our financial result forecast in anticipation of these effects,' said Yamanaka.

(Foreign exchange rates used for the full-year are US$= 107 yen, Euro= 118 yen)