First-Quarter Revenue and Earnings Declines Due to Yen Appreciation

「In the six-month period under review, revenue decreased to ¥3.4749 trillion, down ¥38.6 billion, or 1.1%, year on year, despite the weaker yen, due to lower vehicle production resulting from production stoppages at Japanese customers and sluggish vehicle sales in Asia. Operating profit increased to ¥251.2 billion, up ¥39.4 billion, or 18.6%, year on year, despite unfavorable operating-volume variances, owing to the weaker yen and rationalization efforts, among other factors.」

「For the nine months ended 31 December, revenue increased 15.5% year on year to ¥5,354.9 billion, up ¥719.2 billion, due to strong vehicle sales mainly in Japan and North America, the weaker yen and expanded sales in priority areas such as electrification, peace of mind and safety products. Despite operating-volume variance gains, the weaker yen and rationalization efforts, operating profit declined 11.0% to ¥238.6 billion, down ¥29.4 billion, due to continuing high parts costs, particularly for electronic components, and provisions for quality-related costs.」

「Although vehicle production was affected by semiconductor shortages and lockdowns in China, it recovered throughout the year. In addition, expanded sales progressed steadily, centered on electrification-related products and advanced safety products, which are priority areas, resulting in a 16.1% increase in revenue to ¥6,401.3 billion, up ¥885.8 billion. Despite severe external conditions, including higher parts and raw material, logistics and energy costs, operating profit increased 24.9% to ¥426.1 billion, up ¥84.9 billion, due to global in-house rationalization efforts and the pass-through of higher costs into prices.」

「For the nine months ended 31 December, despite the spread of COVID-19 in China and the impact of semiconductor shortages and other factors, vehicle production was recovering year on year. Together with expanded sales in priority areas such as electrification and the weaker yen, this resulted in a 15.6% increase in revenue to ¥4,635.7 billion, up ¥626.6 billion. Operating profit increased 4.6% to ¥267.9 billion, up ¥11.7 billion, due to the recovery in vehicle production, the effects of expanded sales, foreign exchange gains, rationalization and stronger ability to respond to variable factors, despite external factors including higher parts and logistics costs.」

「For the six months ended 30 September, despite vehicle production cuts caused by the lockdown in China and semiconductor shortages in the first quarter, vehicle production began recovering from the second quarter onward. Revenue increased 16.9% year on year to ¥3,020.1 billion, up ¥437.2 billion, due to expanded sales in priority areas such as electrification and the weaker yen. This was a record high both for the six-month cumulative period and the second-quarter accounting period. Although operating profit benefited from the recovery in vehicle production, expanded sales, the weaker yen and profitability improvement efforts, it declined 2.5% to ¥155.4 billion, down ¥3.9 billion, due to external factors including higher material and logistics costs, particularly for electronic components.」

「For the first quarter ended 30 June, despite vehicle production cuts due to semiconductor shortages and lockdowns in China, revenue increased 4.3% year on year to ¥1,415.0 billion, up ¥58.1 billion, due to expanded sales centered on priority areas such as electrification and favorable foreign exchange effects. Although profitability improvement efforts were made globally, operating profit declined 40.6% to ¥63.6 billion, down ¥43.5 billion, due to operating-volume variance losses from vehicle production cuts and external factors including higher parts and material, energy and logistics costs.」

「For the consolidated fiscal year, revenue increased 11.7% year on year to ¥5,515.5 billion, up ¥578.8 billion, despite vehicle production cuts due to semiconductor shortages and other factors, reflecting the recovery from the impact of COVID-19. Although operating profit was affected by operating-volume variance losses from vehicle production cuts and higher external costs, including parts and materials, logistics, raw materials and energy, it increased 120.0% to ¥341.2 billion, up ¥186.1 billion, due to efforts to improve profitability, including lower fixed costs and more efficient research and development.」

「For the nine months ended 31 December, despite vehicle production cuts due to semiconductor shortages, revenue increased 14.3% year on year to ¥4,009.0 billion, up ¥500.5 billion, as vehicle sales recovered from the impact of COVID-19 in the previous year and expanded sales. Operating profit increased 284.6% to ¥256.3 billion, up ¥189.6 billion, due to the effects of structural reforms, including lower fixed costs and rationalization. However, in the third-quarter accounting period, revenue and profit declined year on year due to vehicle production cuts caused by semiconductor shortages and higher material costs, including electronic components.」

「For the six months ended 30 September, although the company was affected by vehicle production cuts by automakers due to semiconductor shortages and other factors, revenue increased 24.5% year on year to ¥2,582.9 billion, up ¥508.2 billion, as production and sales recovered from the impact of COVID-19 in the previous year. Despite operating-volume variance losses from recent vehicle production cuts due to semiconductor shortages and other factors, and worsening external conditions including higher material and logistics costs, operating profit was ¥159.3 billion, compared with an operating loss of ¥69.6 billion in the same period of the previous year, due to operating-volume variance gains from the recovery in vehicle sales and lower fixed costs resulting from structural reforms.」

「During the first quarter ended 30 June, vehicle production and sales, which had declined the previous year due to COVID-19, recovered steadily. Although vehicle production by automakers was affected by semiconductor shortages, revenue increased 77.3% year on year to ¥1,356.9 billion, up ¥591.8 billion. Operating profit was ¥107.2 billion, compared with an operating loss of ¥106.6 billion in the same quarter of the previous year, due to operating-volume variance gains from the recovery in vehicle production and sales and lower fixed costs resulting from structural reforms.」

「For the nine months ended 31 December, the global economy slowed due to the impact of COVID-19, and vehicle sales fell sharply in the first quarter. Although sales had been recovering from the second quarter onward, revenue declined 9.9% year on year to ¥3,508.6 billion, down ¥386.4 billion. Operating profit was ¥66.6 billion, down ¥96.1 billion, or 59.0%, despite accelerated structural reforms, including emergency cash-preservation measures and more efficient research and development through the introduction of software development tools, because of substantial operating-volume variance losses caused by COVID-19. However, in the three months of the third quarter, increased sales as the market recovered and the success of rationalization and structural reforms resulted in record-high quarterly revenue and operating profit.」

「Revenue declined 42.2% year on year to ¥765.1 billion, down ¥559.0 billion, due to lower vehicle sales. The operating loss was ¥106.6 billion due to lower operating volume, compared with operating profit of ¥69.1 billion in the same quarter of the previous year. The quarterly loss before tax was ¥92.2 billion, and the quarterly loss was ¥94.1 billion.」

「Operating profit declined 80.7% year on year to ¥61.1 billion, down ¥255.1 billion, and profit before tax declined 74.8% to ¥89.6 billion, down ¥266.4 billion, due to provisions for quality-related costs incurred in the second half and operating-volume variance losses associated with lower revenue. Profit for the year attributable to owners of the parent declined 73.2% to ¥68.1 billion, down ¥186.4 billion.」

「For the nine months ended 31 December, although the overall automotive market showed signs of slowing, volumes increased due to expanded sales efforts and other factors. However, due to foreign exchange effects, revenue declined 2.1% year on year to ¥3,895.0 billion, down ¥84.6 billion. Operating profit declined 33.2% to ¥162.7 billion, down ¥80.9 billion, as rationalization efforts offset the increase in fixed costs, but foreign exchange effects and provisions for quality-related costs weighed on results.」

「For the six months ended 30 September, although markets in China, India and elsewhere in Asia showed signs of slowing, volumes increased, mainly in Japan and North America. However, due to foreign exchange effects, revenue declined 0.2% year on year to ¥2,618.4 billion, down ¥6.6 billion. Despite operating-volume variance gains and rationalization efforts, operating profit declined 12.0% to ¥134.0 billion, down ¥18.4 billion, and quarterly profit before tax declined 11.2% to ¥151.2 billion, down ¥19.0 billion, due to investment in future growth areas and foreign exchange effects.」

「For the first quarter ended 30 June, although vehicle production was affected by the market slowdown in Europe and China, volumes increased, supported by higher unit sales to TOYOTA MOTOR CORPORATION. However, due to foreign exchange effects, revenue declined 0.5% year on year to ¥1,324.1 billion, down ¥7.0 billion. Operating profit declined 23.9% to ¥69.1 billion, down ¥21.7 billion, due to accelerated investment in future growth areas, a temporary increase in IT investment to improve future productivity and work practices, and foreign exchange effects, mainly involving the Chinese yuan and euro.」

「For the consolidated fiscal year, despite signs of a market slowdown in Europe and China, revenue increased 5.0% year on year to ¥5,362.8 billion, up ¥254.5 billion, due to increased global vehicle production, expanded sales and the impact of DENSO TEN becoming a subsidiary in November of the year before last. Operating profit declined 23.4% to ¥316.2 billion, down ¥96.5 billion, due to accelerated investment in future growth areas, the absence of one-time income recognized in the previous year and provisions for quality-related costs in the fourth quarter.」

「For the nine months ended 31 December, although the company was affected by the recent market slowdown in Europe and China, revenue increased 7.6% year on year to ¥3,979.7 billion, up ¥280.6 billion, due to increased global vehicle production, expanded sales and the impact of DENSO TEN becoming a subsidiary in November of the year before last. Operating profit declined 22.6% to ¥243.5 billion, down ¥71.1 billion, due to accelerated investment in future growth areas, the absence of one-time income recognized in the previous year and differences in the timing of expense recovery from the previous year.」

「For the six months ended 30 September, despite the impact of natural disasters in Japan, revenue increased 11.1% year on year to ¥2,625.0 billion, up ¥261.5 billion, due to increased global vehicle production, expanded sales and the impact of DENSO TEN becoming a subsidiary in November of the previous year. Operating profit declined 25.5% to ¥152.4 billion, down ¥52.1 billion, and quarterly profit before tax declined 24.9% to ¥170.2 billion, down ¥56.6 billion, due to the absence of one-time income recognized in the previous year, differences in the timing of expense recovery from the previous year and accelerated investment in future growth areas. Profit for the quarter declined 23.6% to ¥125.4 billion, down ¥38.8 billion. Quarterly profit attributable to owners of the parent declined 26.0% to ¥114.1 billion, down ¥40.1 billion.」

「For the first quarter ended 30 June, revenue increased 14.3% year on year to ¥1,331.2 billion, up ¥166.2 billion, due to increased vehicle production, expanded sales and the impact of DENSO TEN Corporation, which became a subsidiary in November of the previous year, and TD Mobile Corporation, which became a subsidiary in July of the previous year. Despite operating-volume variance gains and rationalization efforts, operating profit declined 2.4% to ¥90.9 billion, down ¥2.3 billion, and profit before tax declined 4.1% to ¥109.1 billion, down ¥4.7 billion, due mainly to accelerated investment in future areas of competition. Profit for the quarter increased 2.7% to ¥83.1 billion, up ¥2.2 billion. Quarterly profit attributable to owners of the parent increased 0.8% to ¥77.3 billion, up ¥0.6 billion.」

「For the consolidated fiscal year, revenue increased 12.8% year on year to ¥5,108.3 billion, up ¥581.1 billion, due to increased production, expanded sales and the impact of newly consolidated companies. Operating profit increased 24.8% to ¥412.7 billion, up ¥82.1 billion, due to operating-volume variance gains from higher revenue and rationalization efforts.」

「For the nine months ended 31 December, revenue increased 11.7% year on year to ¥3,699.1 billion, up ¥387.5 billion, due to increased production, expanded sales and the impact of newly consolidated companies. Operating profit increased 27.1% to ¥314.6 billion, up ¥67.1 billion, and profit before tax increased 27.7% to ¥353.6 billion, up ¥76.6 billion, due to operating-volume variance gains and rationalization efforts. Quarterly profit attributable to owners of the parent increased 31.6% to ¥251.3 billion, up ¥60.4 billion.」

「For the six months ended 30 September, revenue increased 8.6% year on year to ¥2,363.5 billion, up ¥186.6 billion, due to increased production and expanded sales. Operating profit increased 43.3% to ¥204.4 billion, up ¥61.7 billion, and profit before tax increased 50.6% to ¥226.8 billion, up ¥76.2 billion, due to operating-volume variance gains and rationalization efforts. Quarterly profit attributable to owners of the parent increased 58.2% to ¥154.2 billion, up ¥56.7 billion.」

「For the first quarter ended 30 June, revenue increased 6.6% year on year to ¥1,164.9 billion, up ¥72.1 billion, due to increased production and expanded sales. Operating profit increased 38.6% to ¥93.2 billion, up ¥26.0 billion, and profit before tax increased 51.6% to ¥113.7 billion, up ¥38.7 billion, due to operating-volume variance gains and rationalization efforts. Quarterly profit attributable to owners of the parent increased 66.3% to ¥76.7 billion, up ¥30.6 billion.」

「For the consolidated fiscal year, despite the impact of the stronger yen, revenue increased 0.1% year on year to ¥4,527.1 billion, up ¥2.6 billion, due to increased production and expanded sales. Operating profit increased 4.7% to ¥330.6 billion, up ¥14.8 billion, and profit before tax increased 3.9% to ¥360.9 billion, up ¥13.6 billion, due to operating-volume variance gains from higher revenue, rationalization efforts and improved other income and expenses. Profit for the year attributable to owners of the parent increased 5.5% to ¥257.6 billion, up ¥13.4 billion.」

「For the nine months ended 31 December, despite increased production and expanded sales, revenue declined due to the stronger yen to ¥3,311.5 billion, down ¥59.4 billion, or 1.8%, from the same period of the previous year. Operating profit increased to ¥247.5 billion, up ¥4.4 billion, or 1.8%, and profit before tax increased to ¥277.0 billion, up ¥2.4 billion, or 0.9%, due to operating-volume variance gains, rationalization efforts and improved other income and expenses. Quarterly profit attributable to owners of the parent declined to ¥190.9 billion, down ¥0.4 billion, or 0.2%.」

「Although production increased and sales expanded during the six-month period ended [this quarter], the impact of the stronger yen caused revenue to decline to ¥2.1769 trillion, down ¥51.5 billion, or 2.3%, year on year. Operating profit declined to ¥142.7 billion, down ¥5.3 billion, or 3.6%; profit before tax declined to ¥150.6 billion, down ¥16.3 billion, or 9.8%; and profit for the period attributable to owners of the parent declined to ¥97.5 billion, down ¥15.6 billion, or 13.8%.」

「Although production increased and sales expanded during the three-month period ended [this quarter], the impact of the stronger yen caused revenue to decline to ¥1.0928 trillion, down ¥13.2 billion, or 1.2%, year on year. Operating profit declined to ¥67.2 billion, down ¥19.5 billion, or 22.5%; profit before tax declined to ¥75.0 billion, down ¥32.0 billion, or 29.9%; and profit for the quarter attributable to owners of the parent declined to ¥46.1 billion, down ¥27.8 billion, or 37.6%.」