Denso Corporation has reported a strong first quarter, with sales rising 13.6% leading to a 62.5% leap in consolidated net income.
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The Japanese components maker said consolidated net sales totaled 856.2bn yen (US$7.4bn). Operating income totaled 82.5bn yen, a 16% increase from the first quarter of last term. Income before income taxes and minority interests for the period totaled 89.9bn yen, a 36.6% rise.
Consolidated net income totaled 58.5bn yen.
“We are pleased with the favourable financial results for this first quarter,” said Koji Kobayashi, managing officer of Denso Corporation. “The increase in domestic car production supported by growing export from Japanese auto manufacturers, and the increase in sales overseas contributed to increased sales.”
In Japan, strong domestic car production contributed to the increased sales, which totaled 597.2bn yen, an 11.6% increase from the first quarter of last term. Operating income totaled 58.6bn yen, a 9.3% increase, due to the increase in production volume and cost reduction efforts.
In North, Central and South America, combined sales totalled 192.3bn yen, up 18.9% on last year, and operating income totaled 8.6bn yen, a 5.7% increase. The sales increase was led by increased sales to auto manufacturers such as Toyota and GM, the company said.
In Europe, increased sales of car air conditioners and diesel common rail injection systems led to a rise in sales to 125.0bn yen, a rise of 19.4%. A rise in production volume in Hungary and the Czech Republic led to an increase in operating income totaling 3.2bn yen.
In Asia and Oceania, sales totaled 108.3bn yen, a rise of 19.7%. Operating income totaled 10.9bn yen, up 26.1% on the same period last year.Strong production for Japanese auto manufacturers in Thailand and China led to the increase in both sales and operating income.
The company also announced its long awaited mid-term plan.
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By GlobalData“As management targets, Denso aims to achieve more than 4,000bn yen for consolidated net sales, and 10% for return on equity (ROE) by 2010,” CEO Koichi Fukaya said.
For the year ended March 31, 2006, Denso’s consolidated net sales totaled 3,188.3bn yen and ROE was 9.4%.
