Toyota supplier Denso posts 76% rise in Q2 profit
TOKYO (Reuters) - Denso Corp, Toyota Motor Corp's major supplier, reported a 76% rise in second-quarter operating profit on Friday, missing analysts' estimates.
It posted 91.8 billion yen ($626.5 million) in operating profit for the three months to end-September, versus an average 120.48 billion yen profit estimated by five analysts, according to Refinitiv data.
A year earlier, the company earned 52.1 billion yen in profit.
The company specialising in vehicle air conditioning, power trains and automated driving systems stuck to its already downgraded full-year operating profit forecast of 480 billion yen for the year ending March 31. That compares with a 211 billion yen average forecast by 21 analysts.
The revision comes after Toyota said last week its annual production plan for 9.7 million vehicles was likely to come in below it due to chips shortage.
Toyota's announcement dampened hopes that the chip shortage would ease and allow automakers to increase production in the second half of the financial year to make up for constrained output in the first half.
Denso executive Yasushi Matsui told reporters the company factored in the downward risk of automakers reducing current business year production plans by 10% compared with its earlier plan. Even if the plan went down by that much, it would still be higher volume than last financial year's.
"The (automakers') original plan was to produce more units per month than they had ever made in the past to get rid of order backlogs," he said. "I think it's fair to say that (the production level) is getting back to the normal level seen in the past."
Although it is not clear when the chips shortage for vehicles would improve, Matsui said he thinks the shortage will gradually ease starting next year.
($1 = 146.5200 yen)
(Reporting by Satoshi Sugiyama; Editing by Shri Navaratnam and Stephen Coates)