August 4, 2023

Although the profit growth range exceeded the full-year plan in the first quarter, is it correct to assume that profits will accumulate from the second quarter onward?

Profits from the second quarter onward will accumulate, although the pace of growth will change. The future of the North American processing business is still unforeseen because the surimi price is on a downward trend. We expect the food business to remain strong.

What is your expectation of achieving a full-year plan of 10 billion yen in the aquaculture business?

There are concerns about the impact of natural disasters such as typhoons and the difficulty of selling prices to rise, but we believe we are getting closer to achieving the goal. By working on measures to reduce volatility in business performance, we aim to earn an operating profit of 10 billion yen early.

I would like to hear your comments on the progress of the first quarter of the aquaculture business.

The performance far exceeded the plan by the expansion of Coho salmon farming and early sales of yellowtails. We got off to a good start.

Please tell us about the risks in the fisheries business from the second quarter onward.

There would be risks of poor anchovy catches due to Super El Niño and restrictions on wheat production and export problems caused by the Russian invasion of Ukraine. These will increase feed costs and reduce the profitability of the aquaculture business.

Please tell us about the South American aquaculture business outlook from the second quarter onward.

The improvement of aquaculture performance has mitigated the volatility of the performance range. Although there are concerns about market fluctuations in the future, business performance is likely to continue steadily.

How was the impact of price increases and cost increases in the first quarter?

In the domestic food business, the impact of the cost increase was -3.0 billion yen, but the effect of the price increase was +5.5 billion yen, resulting in a net gain of +2.5 billion yen.

How was the domestic food business comparing the plan for the first quarter? Also, please tell us if there are any risks to achieving the full-year plan.

We expected a volume decrease to some extent due to the price increase. Still, it held up more than anticipated in affordable products such as chikuwa (processed surimi) for home use and frozen foods (especially bento side dishes). For commercial use, the sales volume of shumai and spring rolls increased. Although the pace of growth will change from the second quarter onward, we don't expect it to fall below the plan.

Please tell us about the background to the increase in operating profit, such as the factors behind the structural change in the domestic food business and changes in the competitive environment due to cost increases.

By "thorough profit management of a single product," we have secured profits despite cost increases. It is also significant that the number of SKUs has been reduced based on "thorough profit management of a single product."

You mentioned "thorough profit management of a single product" as one of the factors for recovering profits in the domestic food business. However, I would like you to tell me a little more precisely. I would also like to confirm the continuity of this effect.

In response to the cost increase from two years ago, we have reviewed the cost of each product individually and managed both the profits of manufacturing and sales. If an item is not profitable in manufacturing and sales, we quit or replace the item with the other. We will continue this initiative.

I would like to confirm the deployment of the EPA pharmaceutical business in Japan and overseas.

One year has passed since the launch of a new EPA drug type sold by a domestic pharmaceutical company. The prescription period will be extended, and we hope the number of prescriptions will increase. We are working diligently to prepare the application required for export to Europe and plan to ship it in the fourth quarter. We expect a sales volume to some extent in FY24.