Raw Material Price Volatility Due to Exchange-Rate Movements

「In Japan's food industry, the operating environment became challenging as raw material prices remained high and costs for packaging materials, energy, logistics and labor continued to rise.」

「In the food industry, raw-material and energy prices, logistics expenses and labor costs remained high, while upward pressure on procurement costs from foreign-exchange movements continued, resulting in a difficult business environment.」

「This was due to the decline in sales of products, specifically frozen scallop adductor muscles, and the negative rebound effect from the end of sales of inventory whose carrying value had been reduced following China's ban on imports of Japanese fishery products. It also reflected higher costs resulting from lower raw material procurement volumes caused by reduced catches, as well as a review of the valuation of boiled scallops for the domestic market.」

「Overseas, sales to retailers such as supermarkets and to restaurants stagnated due to the economic slowdown in Singapore, while higher prices increased costs, resulting in lower revenue and lower profit.」

「Foreign exchange losses of ¥50.494 million were recorded due to fluctuations in foreign exchange rates, compared with a foreign exchange gain of ¥240.048 million in the same period of the previous fiscal year.」

「Meanwhile, the yen continues to weaken and inflation caused by higher raw material and energy prices continues, leaving the outlook uncertain.」

「Our group procures many raw materials and products, directly or indirectly, from overseas. Accordingly, if sharp fluctuations in foreign exchange rates cause procurement prices to rise sharply, delayed or insufficient pass-through to selling prices could affect our group's performance and financial position. Products manufactured by our group are made primarily from processed agricultural products such as wheat, buckwheat, rice, onions and cabbage; marine products such as salmon, oysters, wakame seaweed, hijiki seaweed and scallops; and meat such as chicken.」

「In Japan's food industry, higher raw material and energy prices and inflation resulting from yen depreciation continue, prompting price increases and product price reviews. At the same time, consumers continue to restrain personal spending amid falling real wages, and the challenging operating environment across the industry is expected to continue.」

「In terms of profit, costs increased due to the continued rise in raw material and energy prices and the recording of ¥238 million in M&A acquisition-related expenses. However, increased sales and the effects of ongoing improvements in production efficiency resulted in a slight increase in profit from the previous fiscal year.」

「Although some companies struggled as higher raw material and energy prices increased manufacturing and procurement costs,」

「In Japan's food industry, food prices are being revised upward in response to higher raw material and energy prices. However, as further yen depreciation is expected to drive additional increases in raw material and energy prices, the challenging operating environment is expected to continue.」

「In the overseas business, sales exceeded the same period of the previous fiscal year as restrictions related to COVID-19 were eased, but profit fell below the previous year's level because raw material prices, logistics costs and labor costs rose more than expected.」

「Ordinary profit and profit attributable to owners of the parent for the cumulative third quarter reflected the recording of a foreign exchange gain of ¥134.747 million during the cumulative third quarter due to fluctuations in foreign exchange rates, compared with a foreign exchange loss of ¥62.907 million in the cumulative third quarter of the previous fiscal year, and may fluctuate depending on future foreign exchange rates.」

「Ordinary profit and profit attributable to owners of the parent for the cumulative second quarter reflected the recording of a foreign exchange gain of ¥89.411 million during the cumulative second quarter due to fluctuations in foreign exchange rates, compared with a foreign exchange loss of ¥62.907 million in the cumulative second quarter of the previous fiscal year, and may fluctuate depending on future foreign exchange rates.」

「Our group procures many raw materials and products, directly or indirectly, through imports from overseas. Accordingly, if sharp fluctuations in foreign exchange rates cause procurement prices to rise sharply, the pass-through to selling prices may be delayed, potentially affecting our group's performance and financial position.」

「Ordinary profit was ¥295.896 million, down 41.3% year on year, after foreign exchange losses of ¥62.907 million were recorded due to fluctuations in foreign exchange rates at the end of the second quarter,」

「Ordinary profit was ¥94.178 million, down 59.0% year on year, after foreign exchange losses of ¥134.035 million were recorded due to fluctuations in foreign exchange rates at the end of the first quarter,」

「Profit attributable to owners of the parent was ¥177.214 million, down 32.7% year on year, due to the recording of foreign exchange losses caused by sharp fluctuations in foreign exchange rates resulting from the spread of COVID-19 and other factors, as well as the reversal of deferred tax assets at a subsidiary.」

「Although raw material and other prices remained high, sales rose 16.2% year on year to ¥15,315.050 million and profit rose 75.1% to ¥597.717 million, mainly because PACIFIC SORBY PTE. LTD. and 株式会社森養魚場, which became group companies during the fiscal year, contributed to earnings.」

「In addition, as consumers have become more inclined to save, higher raw material prices and surging logistics costs have affected the industry as a whole.」

「Profit was ¥134.888 million, down 30.9% year on year, due to the impact of persistently high raw material prices and other factors.」

「In terms of profit, the decline in profit margins at major subsidiaries due to higher raw material and supplies prices and lower productivity, among other factors, resulted in operating profit of ¥354.930 million, down 28.2% year on year, ordinary profit of ¥420.278 million, down 24.2%, and profit attributable to owners of the parent of ¥263.692 million, down 37.1%.」

「In terms of profit, the decline in profit margins at major subsidiaries due to higher raw material prices and lower productivity, together with increased logistics costs and M&A-related expenses, which rose by approximately ¥118 million from the previous fiscal year to ¥133 million, resulted in operating profit of ¥184.149 million, down 62.1% year on year, ordinary profit of ¥240.970 million, down 54.9%, and profit attributable to owners of the parent of ¥134.958 million, down 68.6%.」

「Although sales increased due to the expansion of the group and other factors, profit continued to be significantly affected by the higher cost ratio resulting from elevated raw material prices and other factors, as well as other effects, and was ¥270.275 million, down 41.3% year on year.」

「Profit was ¥195.192 million, down 35.6% year on year, due to the impact of higher raw material prices.」

「Although profit remained under pressure from higher raw material prices and other factors, the resulting increase in sales for the reasons described above brought profit to ¥682.247 million, up 3.3% year on year.」

「The risk of foreign exchange rate fluctuations has also increased, and there have been instances in which it has affected performance.」

「Meanwhile, raw material and other prices have fallen as the yen has strengthened, and some positive developments have emerged.」

「Although there were concerns about the impact of higher raw material prices and other factors resulting from foreign exchange movements, efforts to reduce the cost ratio through higher productivity driven by increased sales and capital investment resulted in profit of ¥182.459 million.」