Denso Corporation third quarter net sales fell 19.5% to 2.1trillion yen (US$23.0bn) while consolidated operating income slipped 7.5% to JPY78.8bn and net income was down 35.8% to JPY50.4bn.
“Despite the positive effects from each country’s incentive programmes, our sales and operating income have decreased, mainly due to vehicle inventory adjustments by car manufacturers in the first half of the year and a substantial currency exchange loss,” said managing officer Sadahiro Usui.
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“However, our steady efforts in reducing fixed costs improved our income ratio and the fundamental direction of our financial results is toward a recovery.”
Japanese sales fell 19.4% to JPY1,463.2bn (US$15.9bn) due to reduced vehicle exports and currency effects but cost cuts helped a 382% rise in operating income to JPY13.7bn.
North, Central and South America sales fell 20.5% to JPY378.8bn (US$4.1bn) and operating income was off 14.8% to JPY11.0bn.
European sales fell 21.2% to JPY299.5bn and operating income was down 25.8% to JPY5.7bn.
Asia and Oceania sales fell 11.6% to JPY373.5bn and operating income was off 10.2% to JPY51.2bn.
“Considering recent trends of car production worldwide and steady results from our cost reduction efforts, we have revised the full-year forecasts for the fiscal year ending 31 March, 2010,” said Usui. “The future business environment still remains unclear, but we will continue to work to improve earnings.”
The company now expects sales of JPY2.95 trillion, up from JPY2.8 trillion and off 6.1% year on year while operating income is pegged at JPY110bn instead of JPY36.0bn, up JPY147.3bn year on year. Net income is now seen at JPY75bn rather than JPY20bn, up JPY159.1bn versus fiscal 2008.
