Denso has posted year-end consolidated revenue up 5% to US$40.2bn, while consolidated operating profit fell 4.7% to US$2.8bn.
Consolidated profit attributable to owners of the parent company, totalled US$2.2bn, a 5% decrease from the previous year.
“Denso’s revenue increased due to overseas production volume increase and growth in sales in addition to the impact of the weak yen,” said Denso president and CEO, Koji Arima.
“On the other hand, despite cost reduction effort and the production volume increase, operating profit decreased due to the increase in research and development cost and start-up cost for new products.”
In Japan, production volume decrease, mainly in compact cars, led to a fall in revenue to US$23.5bn, a 0.7% drop from the previous year. The increase in R&D cost for future growth in addition to the decrease in production volume and other expenses led to an operating profit of US$1.4bn – a 21.5% fall from the previous year.
In North America, an increase in car production, boosted by steady economic growth, led to a rise in revenue to US$9.9bn, up 15.1% from the previous year.
As a result of more production volume, operating profit totalled US$423.4m, a 20.8% increase from the previous year.
In Europe, car production was up due to the recovery of the economic slump, which led to an increase in revenue to US$5.3bn, improving 7%.
Despite production volume increase and growth in sales, depreciation expenses and other costs for start-up products led to the decrease in the operating profit to 14.4 billion yen US$127.9m, a 14.3% drop from the previous year.
In Asia, increased car production resulted in a revenue rise of US$10.3bn, a 10.6% rise from the previous year.
As a result of the increase in production volume as well as cost reduction effort, operating profit totalled US$857.2m, a 19.4% rise.
In other areas, mainly the South American region, including Brazil and Argentina, revenue was US$528m, a 19.4% fall compared to the previous year. The operating loss was US$17.8m.
“For the new fiscal year, despite production volume increase and the growth in sales, revenue and operating profit will decrease due to the exchange rate,” added Arima.