DENSO announces first-quarter financial results

"Despite market slowdown in Europe and China, revenue, not including foreign exchange fluctuations, increased due to an increase in car production by Toyota. However, foreign exchange fluctuations led to a drop in revenue. Operating profit decreased due to an increase in investment for future growth and IT investment for improving productivity and promoting work style reform, as well as currency exchange loss,” said Yasushi Matsui, senior executive officer of DENSO Corporation. In Japan, an increase in vehicle production led to an increase in revenue to 796.5 billion yen (US$7.4 billion), a 2.3 percent growth from the previous year. Despite a rise in production volume and cost-reduction efforts, there was a drop in operating profit to 23.5 billion yen (US$218.3 million), a 31.0 percent down from the previous year. This is attributed to investments for future growth. In North America, a production volume increase and sales expansion led to an increase in revenue to 315.4 billion yen (US$2.9 billion), an 1.4 percent increase from the previous year. Operating profit totaled 8.2 billion yen (US$75.9 million), a 29.8 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 158.7 billion yen (US$1.5 billion), a 12.8 percent decrease from the previous year due to market slowdown. Despite cost-reduction efforts, production volume decrease and currency exchange loss led a drop in operating profit to 3.2 billion yen (US$30.1 million), a 53.9 percent decrease from the previous year. In Asia, market slowdown led to a drop in revenue to 329.1 billion yen (US$3.1 billion), an 8.1 percent down from the previous year. In spite of cost-reduction efforts, operating profit totaled 25.1 billion yen (US$232.9 million), a 25.5 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 18.4 billion yen (US$170.8 million), a 7.4 percent increase from the previous year. Operating profit totaled 4.1 billion yen (US$38.4 million), a 59.2 percent increase from the previous year. “For the new fiscal year, we have not revised revenue and operating profit due to uncertainty of market and currency exchange fluctuations,” said Matsui. (Foreign exchange rates used for the full-year are US$= 110 yen, Euro= 125 yen) Forecast for Fiscal Year Ending March 31, 2020

	Full-Year Forecast	Changes from Previous FY
Revenue	5,500.0 billion yen [US$51.0 billion]	137.2 billion yen (+2.6 percent)
Operating profit	380.0 billion yen [US$3.5 billion]	63.8 billion yen (+20.2 percent)
Profit before income taxes	429.0 billion yen [US$4.0 billion]	73.0 billion yen (20.5 percent)
Profit attributable to owners of the parent company	305.0 billion yen [US$2.8 billion]	50.5 billion yen (19.8 percent)

 (Notes)
The above forecasts are created based on the information obtained by the date of this announcement and the actual results may differ due to various causes in the future. U.S. dollar amounts have been translated, for convenience only, at the rate of 107.79 yen = US$1, the approximate exchange rate prevailing in the Tokyo Foreign Exchange Market June. 28, 2019. Billion is used in the American sense of one thousand million.
 
About DENSO Corporation
 
DENSO is a $48.3 billion global mobility supplier that develops advanced technology and components for nearly every vehicle make and model on the road today. With manufacturing at its core, DENSO invests in its 211 facilities in 35 countries to produce thermal, powertrain, mobility, electrification, & electronic systems, to create jobs that directly change how the world moves. The company’s 170,000+ employees are paving the way to a mobility future that improves lives, eliminates traffic accidents, and preserves the environment. Globally headquartered in Kariya, Japan, DENSO spent 9.3 percent of its global consolidated sales on research and development in the fiscal year ending March 31, 2019. For more information about global DENSO, visit https://www.denso.com/global