SANDEN CORPORATION
August 9, 2024

SUMMARY OF CONSOLIDATED FINANCIAL RESULTS FOR THE SIX MONTHSENDED JUNE 30, 2024
Fiscal year ending December 31, 2024

SANDEN CORPORATION
20 Kotobuki-cho, Isesaki-shi, Gunma, Japan 372-8502(URL: https://www.sanden.co.jp/english/index.html)

Code No:
6444
Shares listed:Tokyo Stock Exchange
Representative Director & President: Dan Zhu
For further information, please contact
Junya Takahashi
Division General Manager ofCorporate Financial Management Division
Contact Number: +81-3-5828-5582

Scheduled date to file semi-annual securities report: August 9, 2024
Scheduled date to commence dividend payments: Preparation of supplementary material on financial results: Yes
Holding of financial results briefing: Yes (for securities analysts and institutional investors)(Fractions less than \1 million omitted)

1.

Consolidated Financial Results For The Six Months Ended June 30,2024 (January 1, 2024- June 30, 2024)(1) Results of operations(%: percentage change from previous fiscal year)
Operatingincome(Millions of \, %)Net sales(Millions of \, %)Six months ended June 30, 2024
Six months ended June 30, 2023

94,17787,4897.6
6.2(3,396)(4,415)-

Net income pershare diluted (\)

4.49(2.83)-

Six months ended June 30, 2024
Six months ended June 30, 2023

Total assets(Millions of \)As of June 30, 2024
As of December 31, 2023

2.

1,409
(984)

500
(315)

-

-

(Fractions less than \1 million omitted)(2) Financial positions

Notes:Net income(Millions of \, %)\ 4,619million -%\ (417)million -%Notes: Equity in Comprehensive Income: For the six months ended June 30, 2024
Notes: Equity in Comprehensive Income: For the six months ended June 30, 2023
Net income pershare basic (\)

Income before
extraordinary items(Millions of \, %)Equity capital As of June 30, 2024
As of December 31, 2023

Net assets(Millions of \)172,974
162,539\ 24,583million\ 20,192million

Equity Ratio of
equity over total assets(%)

25,456
20,836

Net assets per share
(\)

14.2
12.4

220.58181.18Dividends
1Q-

Fiscal year ended December 31, 2023
Fiscal year ending December 31, 2024
Fiscal year ending December 31, 2024 (Forecast)

2Q
0.00
0.00

Dividend per share (\)
3Q
4Q
0.00
-

Total
0.00

0.00

0.00

Note: Revisions made since the most recently published dividends forecast: None

3. Forecast of business results for the next fiscal year (January 1, 2024-December 31, 2024)
Net sales(Millions of \, %)Fiscal year ending December 31, 2024

180,000

0.4(%: percentage change from the same period of the previous fiscal year)
Net income
Income before
Net income
per share
extraordinary items
basic(Millions of \, %)(Millions of \, %)(\)

Operatingincome(Millions of \, %)(6,800)Note: Revisions made since the most recently published earnings forecast: None-

(2,800)-(1,600)-(14.36)

*Notes(1) Significant changes in the scope of consolidation during the period: None
(2) Adoption of accounting treatment specific to the preparation of semi-annual consolidated financial statements: Yes.
For details, please refer to "2. Semi-Annual Consolidated Financial Statements and Major Notes (4) Notes to Semi-Annual
Consolidated Financial Statements (Specific accounting treatment used in the creation of the semi-annual consolidated financial
statements)" on page 8 of the attached document.
(3) Changes in accounting principles and estimates, and retrospective restatement(a) Changes due to revision of accounting standards: None(b) Changes other than in (a): None(c) Changes in accounting estimates: None(d) Retrospective restatement: None

(4) Number of outstanding shares (common stock, shares)(a) Outstanding shares (including treasury shares)

As of June 30, 2024:

111,693,313

As of December 31, 2023:

111,693,313(b) Treasury shares

As of June 30, 2024:

243,266

As of December 31, 2023:

243,057(c) Average number of shares outstanding
during the period (cumulative)

As of June 30, 2024:

111,450,134

As of June 30, 2023:

111,450,498*Semi-annual financial results reports are exempt from review conducted by certified public accountants or an audit firm.
*Cautionary statement regarding forecasts of operating results and special notes(Note regarding the forward-looking statements)
The forward-looking statements contained in this report are based on information currently available to the Company and certain
assumptions which are regarded as legitimate. These statements are not promised by the Company regarding future performance.
Actual results may differ significantly from these forecasts due to various factors. For information about the forecasts, please see “1.
Results of Operations-(3) An explanation of future, predictive data, such as consolidated earnings forecasts” on page 2 ofSupplementary Information.

Index for Supplementary Information
1

Results of Operations .................................................................................................................................................... 2(1) Overview of results of operations ................................................................................................................................ 2(2) Overview of financial condition .................................................................................................................................... 2(3) Explanation of consolidated earnings forecasts and other future predictions .............................................................. 2

2

Semi-annual Consolidated Financial Statements and Important Notes ......................................................................... 3(1) Semi-annual consolidated balance sheet .................................................................................................................... 3(2) Semi-annual consolidated statement of income and semi-annual consolidated statement of comprehensive
income ......................................................................................................................................................................... 5
Semi-annual consolidated statement of income ........................................................................................................... 5
Semi-annual consolidated statement of comprehensive income ................................................................................. 6(3) Semi-annual Consolidated Statement of Cash Flows.................................................................................................. 7(4) Notes to Semi-annual Consolidated Financial Statements .......................................................................................... 8(Notes on going concern assumption).......................................................................................................................... 8(Note on significant change in shareholders’ equity) .................................................................................................... 8(Application of special accounting treatment to the preparation of semi-annual consolidated financial statements) .... 8(Segment information).................................................................................................................................................. 8

1

1 Results of Operations(1) Overview of results of operations
The activities of Sanden Group are guided by the vision of “becoming the global leader in the fields of automotive
compressors and integrated thermal management systems.” Under the medium-term management plan that
Sanden Corporation announced this year, the Company aims to transform from a supplier of components to a“supplier of full solution systems” and achieve sustainable growth and as a leading company in integrated thermal
management systems. With the automobile industry currently in the midst of a period of enormous changes, weare focusing on the new energy vehicle (NEV) market. We will offer competitive, flexible integrated thermal
management system solutions by utilizing our electric compressor manufacturing capabilities. Our priority will
always be our customers.
During the first half of the fiscal year under review, the global economy was on path toward a moderate recovery.
However, some regions showed signs of slowing economies, attributable to the prolonged military conflicts in
Ukraine and the Middle East, the sharp depreciation of the yen, as well as tightening monetary policies, among
other factors.
Looking at factors that have an impact on the Group’s results, automobile production decreased year on year in
the Group’s mainstay European market although it remained flat from the year-ago level globally. Even so, net
sales in the first half of the fiscal year under review came to 94,177 million yen (up 7.6% year on year), reflecting
the impact of a significantly weaker yen in the foreign exchange market. Although profitability was improving due
to the impact of foreign exchange rates and a range of measures such as profitability improvement activities, theGroup posted an operating loss of 3,396 million yen (compared to an operating loss of 4,415 million yen in thesame period of the previous year), mainly reflecting surging raw material prices, coupled with an increase inresearch and development expenses (up 11.0% year on year) due to the acquisition of new commercial rights withan eye on growth over the medium and long terms. Ordinary profit amounted to 1,409 million yen (compared with
an operating loss of 984 million yen in the same period of the previous year), reflecting the share of profit of entities
accounted for using equity method and gains on evaluation of foreign currency-denominated receivables. Profit
before income taxes came to 1,396 million yen (up 954.4% year on year). Consequently, profit attributable toowners of parent was 500 million yen (loss attributable to owners of parent of 315 million yen in the same period of
the previous year).
Segment information is omitted because the Group operates a single segment of Automotive Systems Business.
(2) Overview of financial condition(A) Overview of assets, liabilities and net assets
Total assets at the end of the second quarter under review increased 10,434 million yen from the end of the previous
fiscal year, to 172,974 million yen, primarily reflecting an increase in property, plant and equipment due to capital
investment and a rise in investment securities due to profit posted at entities accounted for using the equity method.
Liabilities came to 147,517 million yen, up 5,814 million yen from the end of the previous fiscal year, chiefly
attributable to other in current liabilities including accrued expenses and short-term borrowings.
Net assets increased 4,620 million yen from the end of the previous fiscal year, to 25,456 million yen, chiefly
reflecting an increase in foreign currency translation adjustments due to the weak yen.
(B) Overview of cash flow
Cash and cash equivalents were 15,214 million yen at the end of the second quarter of the fiscal year under review,
down 6,405 million yen from the end of the previous fiscal year.
Net cash used in operating activities came to 3,772 million yen (cash inflow decreased 8,197 million yen year onyear), reflecting increases in trade receivables and inventories and a decrease in dividends received due to aslippage in the date of receipt, despite an increase in interim profit before income taxes.
Net cash used in investing activities amounted to 4,568 million yen (the cash outflow increased 94 million yen year
on year), mainly due to the purchase of property, plant and equipment of 4,236 million yen.
Net cash provided by financing activities was 614 million yen (cash inflow decreased 6,067 million yen year onyear), primarily due to a decrease in short-term borrowings executed.
(3) Explanation of consolidated earnings forecasts and other future predictions
There has been no revision to the consolidated forecasts for the fiscal year ending December 31, 2024, which werereleased on February 14, 2024.
2

2

Semi-annual Consolidated Financial Statements and Important Notes(1) Semi-annual consolidated balance sheet(Million yen)
Fiscal year ended
First half ended June 2024
December 2023
(As of June 30, 2024)(As of December 31, 2023)
ASSETS
Current assets
Cash and deposits
Notes and accounts receivable - trade, and contract
assetsMerchandise and finished goods
Work in process
Raw materials
Other inventories
Accounts receivable - otherConsumption taxes receivable
Other
Allowance for doubtful accounts

22,74916,60247,00851,55013,450
9,450
7,235
1,204
3,451
2,443
6,917
(17,262)

14,19010,442
8,451
1,275
3,018
3,412
7,809
(19,025)

Total current assets

96,647

97,727

Noncurrent assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Tools, furniture and fixtures, net
Land
Lease assets, net
Construction in progress

13,782
12,828
3,374
6,600
1,779
4,291

14,40814,783
3,179
6,727
1,717
5,853

Total property, plant and equipment

42,657

46,670

1,435

1,735

1,435

1,735

20,276
100
430
3,684
(2,693)25,311
100
544
3,959
(3,076)

21,79926,840Intangible assets
Other
Total intangible assets
Investments and other assets
Investment securities
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets

65,89275,246

Total assets

162,539

172,9743

(Million yen)
Fiscal year ended
First half ended June 2024
December 2023
(As of June 30, 2024)(As of December 31, 2023)
LIABILITIESCurrent liabilities
Notes and accounts payable - trade
Short-term borrowings
Current portion of long-term borrowings
Accounts payable - other
Lease obligations
Income taxes payable
Provision for bonuses
Provision for product warranties
Loss on compensation for damage
Allowance for structural reform
Other
Total current liabilities
Noncurrent liabilities
Long-term borrowings
Lease obligations
Deferred tax liabilities
Retirement benefit liability
Provision for environmental measures
Other
Total noncurrent liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares

38,09956,102
300
8,680
1,498
1,267
1,966
6,738
2,130
3,364
11,28538,98758,655
377
9,166
1,329
960
1,705
6,657
2,167
3,824
13,350131,434

137,181

822
3,403
1,821
2,118
512
1,589

852
2,748
2,269
2,331
541
1,592

10,26910,336

141,703

147,517

21,741
14,081(20,125)(531)

21,741
14,069(19,625)(531)

Total shareholders’ equity

15,165

15,653

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans

60
(19)
4,138
847

108
(63)
7,863
1,021

Total accumulated other comprehensive income

5,027

8,929

Non-controlling interests
Total net assets
Total liabilities and net assets

4

643

872

20,83625,456

162,539

172,974(2) Semi-annual consolidated statement of income and semi-annual consolidated statement of comprehensive income
Semi-annual consolidated statement of income(Million yen)First half ended Jun. 2023
(Jan. 1, 2023 –Jun. 30, 2023)

First half ended Jun. 2024
(Jan. 1, 2024 –Jun. 30, 2024)

Net sales
Cost of sales

87,48977,465

94,17780,821Gross profit

10,024

13,356

Selling, general and administrative expenses

14,43916,753Operating profit (loss)(4,415)(3,396)

45
28
1,451

176
27
2,216

2,445

2,605

401
426

406
748

4,798

6,181

738
629

653
722

Non-operating income
Interest income
Dividend income
Foreign exchange gains
Share of profit of investments accounted for using equity
methodRental income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Other

1,367

1,375

Ordinary profit (loss)

Total non-operating expenses

(984)

1,409

Extraordinary income
Gain on sale of non-current assets
Reversal of allowance for doubtful accounts
Reversal of allowance for restructuring initiatives
Other

72
1,050
1,277
19

17
20
13

2,420

50

1,179
29
94

15
48

Total extraordinary income
Extraordinary losses
Impairment losses
Loss on disposal of non-current assets
Other

1,303

63

Profit before income taxes

Total extraordinary losses

132

1,396

Income taxes

471

800

Profit (loss)

(338)

595

Profit (loss) attributable to non-controlling interests

(23)

95

Profit (loss) attributable to owners of parent

(315)

500

5

Semi-annual consolidated statement of comprehensive income(Million yen)

Profit (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of associates
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

6

First half ended Jun. 2023
(Jan. 1, 2023 –Jun. 30, 2023)

First half ended Jun. 2024
(Jan. 1, 2024 –Jun. 30, 2024)

(338)

595

62
(3)
(1,145)
138

36
(44)
1,611
174

868

2,246

(79)

4,024

(417)

4,619

(444)

4,402

26

216

(3) Semi-annual Consolidated Statement of Cash Flows(Million yen)First half ended Jun. 2023
(Jan. 1, 2023 –Jun. 30, 2023)

First half ended Jun. 2024
(Jan. 1, 2024 –Jun. 30, 2024)

132
2,252
(311)
643
(291)

1,396
2,819
(361)
(499)
(234)

(224)

-

(73)
738

(203)
653

(2,445)(2,605)(1,277)
1,179
2,025
2,545
144

148
(354)
535

77

(920)

66
(32)
500
(3,763)(1,262)
1,073
922(3,802)

Subtotal

1,886(2,694)

Interest and dividends received
Interest paid
Income taxes refund (paid)

3,284
(737)
(8)

205
(561)
(721)

Cash flows from operating activities
Profit before income taxes
Depreciation
Increase (decrease) in provision for bonuses
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for product warranties
Increase (decrease) in provision for loss on compensation
for damage
Interest and dividend income
Interest expenses
Share of loss (profit) of entities accounted for using equity
methodReversal of allowance for restructuring initiatives
Impairment losses
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Decrease (increase) in accounts receivable – other
Decrease (increase) in consumption taxes refund
receivable
Increase (decrease) in trade payables
Increase (decrease) in accounts payable - other
Increase (decrease) in accrued expenses
Other, net

Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Other, net

4,425(3,772)(4,080)
106
(158)
(8)
(332)

(4,236)
33
(155)
(12)
(198)

Net cash provided by (used in) investing activities(4,473)(4,568)Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Repayments of lease obligations
Purchase of treasury shares
Other, net

7,455
435
(165)
(1,042)
(0)
(0)

1,708
130
(164)
(1,061)(0)0

Net cash provided by (used in) financing activities

6,681

614

1,081

1,321

Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents

7,714(6,405)

Cash and cash equivalents at beginning of period

17,102

21,620Cash and cash equivalents at end of period

24,816

15,2147

(4) Notes to Semi-annual Consolidated Financial Statements(Notes on going concern assumption)
None(Note on significant change in shareholders’ equity)
None(Application of special accounting treatment to the preparation of semi-annual consolidated financial statements)
First half ended Jun. 2024
(Jan. 1, 2024 – Jun. 30, 2024)
Calculation of taxes

Taxes are calculated by determining a reasonable estimate of the effective tax rate, after
the application of tax effect accounting, for profit before income taxes in the current fiscal
year (including the first half). Quarterly profit before income taxes is then multiplied by thisestimated effective tax rate to calculate taxes.
However, in cases where the calculation of taxes using such estimated effective tax rateyields a result that is not reasonable to a significant extent, the effective statutory tax rateis used.
Income taxes - deferred are included in income taxes.

(Segment information)
I

First half of the previous fiscal year (January 1, 2023 – June 30, 2023)
Omitted because the Sanden Group has only the single reportable segment of Automotive Systems.

IIFirst half of the current fiscal year (January 1, 2024 – June 30, 2024)
Omitted because the Sanden Group has only the single reportable segment of Automotive Systems.

8