Both sales and profits increased thanks to the good catch of sardines, mackerel, etc.

Nissui increases profits in the fishing sector

JAPAN
Friday, May 17, 2024, 07:00 (GMT + 9)

Consolidated fiscal year ending March 2024. Improved profitability through inventory reduction, etc.

Shinya Yamamoto, CEO and CFO of Nissui (Chairman Shingo Hamada) summarized the consolidated financial results for the fiscal year ending March 2024 saying: "Sales, operating income and net income reached all-time highs, which resulted in a good financial result," he spoke at an online financial results conference on the 14th. In terms of sales by business, marine products increased 2.6% year-on-year to 336.8 billion yen, and food products increased 2.6% year-on-year to 336.8 billion yen, 16%. 443.2 billion yen. Although market conditions for marine products worsened, sales increased due to the weak yen.

Both sales and operating income reached record levels. Net profit also hit a new high for the third year in a row. Shinya Yamamoto added: "We were able to achieve good numbers. We want to work towards achieving the medium-term plan and at the same time respond to changes with agility."

Qualitative information for the financial year ended March 31, 2024

Explanation of consolidated financial results

During the consolidated fiscal year, there were concerns about the outlook for the Japanese economy due to factors such as inflation caused by the prolonged situation in Ukraine and other uncertainties. However, there were positive signs of improvement in the economic environment, driven by the transition of COVID-19 to a level 5 infectious disease and domestic travel support, leading to the recovery of human flow and incoming demand.

Regarding the global economy, during the consolidated period from January to December, high inflation and the increase in official interest rates continued in Europe and the United States. The economy remained stable in the United States with continued improvement in employment and an increase in personal consumption. While in Europe the economy was slow, mainly in Germany, as demand decreased due to monetary tightening.

For the company and its group, the Food Products business was positively affected by the increase in domestic and international sales prices and the decrease in raw material prices, which resulted in a significant increase in profits.

In the Marine Products business, profits declined as market prices of our main products, such as salmon and surimi, declined in Japan and abroad, while the domestic seafood business remained firm.

In the current situation, our consolidated business performance was as follows: net sales were 831.375 million yen, an increase of 63.194 million yen year-on-year; operating profit was 29.663 billion yen, a year-on-year increase of 5.175 billion yen; ordinary profit was 31,963 million yen, a year-on-year increase of 4,187 million yen; The profit attributable to the owners of the parent company was 23.85 billion yen, a year-on-year increase of 2.617 billion yen. We achieved a record in both operating profit and attributable to the owners of the parent company. The gain on the sale of shares of one of our consolidated subsidiaries, Nissui Pharmaceutical Co., Ltd. (now Shimadzu Diagnostics Corporation), was recorded in the first half of fiscal 2022.

Marine products business

The marine products segment is engaged in the businesses of fishing, aquaculture, and seafood processing and marketing.

We recorded 336,892 million yen (up 8,557 million yen year-over-year) in sales and an operating profit of 10,697 million yen (down 7,881 million yen year-over-year) in the marine products business.

Fishing business: Both sales and profits increased year over year.

[Japan]

Both sales and profits increased thanks to the good catch of sardines, mackerel, etc.

Aquaculture Business: Sales increased but profits decreased year over year.

[Japan]

Coho Salmon numbers increased due to improved operation with no mortality or increasing backlog, and farmed tuna sales prices were strong. Farmed Buri horse mackerel sold well last year as we were able to take advantage of full consolidation while competitors were unable to supply the fish well. However, total supply returned to normal levels this year, resulting in a reactionary decline caused by weakening selling prices. As a result, sales increased, but profits decreased.

[South America]

Sales increased due to improvements in survival rates and an increase in trout sales volume as a result of improvements in the breeding environment. However, profits decreased due to a negative impact on the evaluation of fish in the pond (Note 1), as the selling price began to be lower than the previous year in the middle of this year.

Seafood processing and marketing business: Sales increased, but profits decreased year over year.

[Japan]

Sales of commercial seafood and industrial lunches began to show the positive effects of rising prices. In addition, sales of shrimp, fish oil and fish meal performed well.

However, we accelerated the early removal of unprofitable inventory as fish market prices for key products such as salmon/trout, surimi and imported frozen tuna entered an adjustment phase. Profits rose in the fourth quarter but declined for the full year.

[North America]

An increase in the catch quota for Alaska pollock increased production volume in the processing business. However, profits declined due to rising costs, such as labor expenses, and a sharp drop in the market price of surimi and fillet caused by increased supply.

[Europe]

The decline in profits can be attributed to reduced pollock inventories. Additionally, the pace of cargo movement slowed as the fishing market began to adapt.

Food Products Business

The Food Products segment is engaged in the food processing and refrigerated food businesses.

We recorded 443,297 million yen (up 61,249 million yen year-over-year) in sales and an operating profit of 27,291 million yen (up 15,864 million yen year-over-year) in the food products business.

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