- Decrease in North American car production and currency exchange loss led to reduction in net sales and operating income -

KARIYA (Japan) - DENSO Corporation today announced global financial results for the first-half fiscal year ended September 30, 2008:

• Consolidated net sales totaled 1,892.3 billion yen (US$18.3 billion), a 2.9 percent decrease from the previous year.
• Consolidated operating income totaled 114.8 billion yen (US$1.1 billion), a 32.1 percent decrease from the previous year.
• Consolidated net income totaled 59.0 billion yen (US$569.2 million), a 50.2 percent decrease from the previous year.

"Sales decreased mainly due to the decrease in car production in North America and substantial currency exchange loss, despite an increase in car production for Japanese auto manufacturers in ASEAN countries and China," said Sadahiro Usui, managing officer of DENSO Corporation. "In addition to the substantial currency exchange loss, increases in labor and raw materials costs led to a decrease in operating income."

In Japan, sales totaled 1,280.1 billion yen (US$12.4 billion), a 2.2 percent decrease from the previous year. In addition to a sales decrease resulting from the decrease in product exports mainly to North America, along with substantial currency exchange loss, rising raw materials costs led to operating income of 44.7 billion yen (US$431.3 million), a 53.1 percent decrease from the previous year.

In North, Central and South America, a decrease in sales mainly to Toyota and the three major American automakers, resulting from the decrease in car production in North America, led to a decrease in sales to 356.7 billion yen (US$3.4 billion), a 17.0 percent decrease from the previous year. Despite cost-reduction efforts, the decrease in production volume and increase in labor costs led to operating income of 14.9 billion yen (US$144.1million), a 36.1 percent decrease from the previous year.

In Europe, sales totaled 293.5 billion yen (US$2.8 billion), a 1.7 percent decrease from the previous year. Despite sales expansion to Fiat for air conditioning systems, the slowdown in car production for Japanese auto manufacturers and increase in labor costs led to operating income of 9.1 billion yen (US$87.7 million), a 20.6 percent decrease from the previous year.

In Asia and Oceania, sales totaled 300.6 billion yen (US$2.9 billion), a 0.6 percent increase from the previous year, due to continued growth in car production volumes for Japanese auto manufacturers in ASEAN countries and China. Operating income totaled 43.4 billion yen (US$418.9 million), a 13.2 percent increase from the previous year. In addition to an increase in production volume, the stable expansion of China operations resulted in an increase in operating income.

"Considering the severe business environment, including the trend of a worldwide slowdown in car production and the further appreciation of the yen in the second half, we have revised the full-year forecasts for the fiscal year ending March 31, 2009," said Usui.

Forecast for Fiscal Year Ending March 31, 2009

DENSO Corporation, headquartered in Kariya, Aichi prefecture, Japan, is a leading global supplier of advanced technology, systems and components. Worldwide, the company employs 119,000 people in 32 countries and regions, including Japan. DENSO common stock is traded on the Tokyo, Osaka and Nagoya stock exchanges in Japan. For more information, go to www.denso.com.

(Notes)
U.S. dollar amounts have been translated, for convenience only, at the rate of 103.57 yen = US$1, the approximate exchange rate prevailing in the Tokyo Foreign Exchange Market on September 30, 2008. Billion is used in the American sense of one thousand million.