TOKYO (Reuters) – Japanese company Denso, a leading supplier Toyotas (NYSE:), lowered its full-year operating profit forecast by 21% on Thursday, largely due to less favorable conditions in China and broader Asia.
The company lowered its operating profit forecast for the fiscal year ending March 31 to 550 billion yen ($3.58 billion) from 692 billion yen, missing the average estimate of 672.2 billion yen, according to 16 analysts surveyed by LSEG.
Quarterly operating profit also missed analyst expectations, but still rose due to currency gains and cost control efforts, even amid pressure from lower vehicle production and sales volumes in Asia.
Operating profit for the July-September period rose 11% to 130.7 yen, compared to the 136.5 billion yen estimated by an average of seven analysts. The company earned 117.4 billion yen a year earlier.
The world’s second-largest maker of auto components derives more than half of its revenue from the Toyota group, which includes truck division Hino Motors and small car maker Daihatsu.
After this announcement, its shares rose by over 5%, then partially gave back their gains and ended the morning session with increases of 2.8%.
($1 = 153.5000 yen)
