Denso Corporation has reported an operating loss of JPY37.3bn (US$379.8m) for the fiscal year ended 31 March, 2009 compared with operating income of JPY348.7bn ($3.5bn) a year ago.
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Sales fell 22% to JPY3,142.7bn. The net loss was JPY84.1bn ($856.0m) versus net income of JPY244.4bn ($2.5bn) in 2007/8.
“The sales decrease and operating loss were due to the sharp decline in worldwide car production in the second half of the fiscal year and substantial currency exchange loss,” said president and CEO Nobuaki Katoh.
Sales in Japan fell 21.3% to JPY2,145.6bn and operating loss was JPY114.7bn ($1.2bn), down JPY312.2bn ($3.2bn) from the previous year’s operating profit.
In addition to a fall in domestic car production and exports mainly to North America and Europe, substantial currency exchange loss resulted in a decrease in sales, and an operating loss.
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By GlobalDataIn North, Central and South America, a decrease in sales mainly to Toyota and the three major American automakers, resulting from the cuts in car production, led to a 33% decrease in sales to JPY559.8bn.
Lower production volumes led to operating income down 88% to JPY5.1bn ($51.7m).
Sales in Europe fell 25% to JPY462.5bn ($4.7bn) due mainly to lower car production for Japanese automakers.
Despite cost-reductions operating income fell 86% to JPY3.6bn ($36.8m).
In Asia and Oceania, sales fell 18% to JPY507.7bn ($5.2bn) and operating income was off 25% to JPY60.5bn ($615.6m).
In spite of an increase in car production volumes for Japanese automakers in China, the slowdown in car production in ASEAN countries and substantial currency exchange loss resulted in decreases in both sales and operating income.
Denso is forecasting fiscal year 2009/10 sales of JPY2,720bn, an operating loss of JPY40bn and a net loss of JPY19bn.
“We are working to create a slim and lean business structure to improve earnings,” added Katoh. “We are also looking to the future, focusing on technological innovations and low-cost technologies.”
