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Nissui lowers forecast

October 26, 2007

Nisssui said Wednesday it is not able to ensure profit with rising costs of fuel, raw and other materials, while shifting cost increases to customers make little headway and it lowered its full-year forecast.

Procurement unit costs of salmon and trout in Japan went up, while sales of shrimp and Chinese eel shrank within the country.

The company also stated farmed salmon virus issue and aftermath of the earthquake in Chile, along with poor fishing in Argentina attributed to the lower projection.

Intensifying competition of frozen foods and surimi products between rival companies in Japan raised promotional campaign costs, which dwindled profit margins. Professional-use frozen seafood sector in the North America was mired in a slump.

Based on the results above, Nissui said it was revising downward its consolidated sales for the interim period to 267 \ billion, down 8 billion from the previous forecast. Operating profits were also lowered \3.8 billion to \6.2 billion, while net earnings dropped \3.8 billion to \1.2 billion.

The company sees delay of reformation of shrimp farming business in Indonesia, a big reduction of farmed salmon production in Chile, uphill battle of professional-use frozen seafood operation in the North America and whole fiscal year`s turn over projection was also revised downward.

Full business year sales were lowered to \535 billion from the previously projected \555 billion. Pretax profits forecast fell \6.5 billion to \11.5 billion.

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