KARIYA, Japan ― DENSO Corp. announced its global financial results for the first quarter ending June 30, 2014.
Consolidated net sales totaled $10.2 billion, a 3.2 percent increase from the previous year. Consolidated operating income totaled $839.1 million, a 16.7 percent decrease from the previous year. Consolidated net income totaled ($678.7 million), a 20.1 percent decrease from the previous year.
"The sales increased due to the production volume increase. Despite the variable cost reduction and the increase in production volume, the operating income decreased due to research and development expenditures and investment costs that will strengthen future growth,” said Kenichiro Ito, executive director of DENSO Corp.
In Japan, the shift toward compact cars, as well as the decrease of export sales led to a decrease in sales to $6.3 billion, a 3 percent decrease from the previous year. The decrease in production volume and the increase in labor costs and other expenses led to an operating income of ($544.8 million), a 26.6 percent decrease from the previous year.
In North America, an increase in car production, boosted by the steady economic growth, led to an increase in sales to $2.2 billion, an 8.3 percent increase from the previous year. As a result of the increase in production volume and the cost reduction effort, the operating income totaled $73.9 million, a 19.8 percent increase from the previous year.
In Europe, car production increased due to the economic slump recovery led to an increase in sales to $1.4 billion, a 17.1 percent increase from the previous year. Due to the increase in production volume and the cost reduction effort, the operating income totaled $39.3 million, a 130.5 percent increase from the previous year.
In Asia and Oceania, the increase of car production mainly in China resulted in a sales increase to $2.4 billion, a 5.8 percent increase from the previous year. The increase in labor costs and the expenditure on the establishment of plants and technical centers for strengthening future growth led to an operating income of ($169.8 million), a 19.4 percent decrease from the previous year.
In other areas, mainly the South American region, including Brazil and Argentina, sales totaled ($181.3 million), a 13.1 percent decrease from the previous year. The operating loss totaled ($2 million), a 121.4 percent decrease from the previous year.
