(Bloomberg) -- Denso Corp. cut its full-year guidance after one of its parts caused millions of recalls, while multiple fraud scandals disrupt production at a number of the Japanese carmakers it supplies.

The parts manufacturer now forecasts operating profit of ¥495 billion ($3.4 billion) for the fiscal year ending in March, compared with its previous outlook for ¥630 billion, issued Oct. 31.

Denso is a key supplier for Toyota Motor Corp., which has been at the center of revelations that began to emerge in December related to issues with certification and safety tests by its subsidiaries, Toyota Industries Corp. and Daihatsu Motor Co. Subsequent production halts mean fewer parts being sold and shipped to the Japanese carmaker, adding to the financial burden of recalls due to Denso’s own faulty pumps. 

“We apologize for the concern we’ve caused customers, and the inconvenience we’ve caused our business partners,” Denso Vice President Yasushi Matsui told reporters. “The reliability of our parts is a pillar of our business.”

Read More: Daihatsu Resumes Production of Two Models After Safety Scandal

Despite the lower outlook, Denso shares rose as much as 4.6% on Friday morning in Tokyo, leaving them up around 13% this year. Toyota shares has also held up, climbing around 14% this year on top of a 43% gain in 2023.

For the last three months of 2023, Denso’s operating profit shrank 76% to ¥27 billion, due in part to 4.3 million vehicle recalls triggered worldwide by a faulty fuel pump manufactured and supplied by Denso.

The supplier will see a ¥17 billion loss during the current fourth fiscal quarter due to supply disruptions at Daihatsu, after an internal investigation revealed in December that its vehicles weren’t properly tested for collision safety.

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