Kyokuyo emphasizes profit over scale expansion
December 20, 2007
Kyokuyo showed that it will strengthen its global expansion
and processed value-added directions.
"I am confident that we are steering our business to
the right directions. We will expand our presence based on
global and processed value-added strategies. We place greatest
emphasis on profit over scale expansion," said Kiyokazu
Fukui, president of the company.
Fukui said that the company will rebuild structure to stabilize
profitability based on the result of misjudged salmon and
velvet shrimp purchases.
"In the first half, we made errors in sourcing salmon
and velvet shrimp. Taking a hard look at failures, we will
improve the ability to gather information, timely appropriate
amount supply and thorough inventory control. We will maintain
routes to stably secure mackerel, herring, Spanish mackerel
and saury and use them as raw materials in a proactive manner."
Asked what sectors the company weighs heavily, Fukui said
tuna farming and sushi business are promising.
"We lay weight on tuna farming year after year. We will
consider farming sea bream and yellowtail farming, as well.
Tuna, bonito operation is related to sushi business and it`s
considered our third pillar. Sushi boom overseas is more than
you envision. We will work tenaciously with our value-added
and moderate priced, double featured products," he said.
Kyokuyo`s consolidated first-half sales achievement rate was
93%, while it was 79% in current earnings. Non-consolidated
sales percentage achievement was 93%, while current earnings`
ratio was far from the target.
"Non-consolidated first half`s current earnings were
disappointing due to shaky seafood trades, but on a consolidated
basis Kyokuyo Suisan and Kyokuyo Kaiun alleviated the drop.
High prices of bonito and marine transportation help bring
Nissui sets higher profits and overseas
December 19, 2007
Naoya Kakizoe, CEO of Nissui emphasizes that the company
will seek further growth and profit-earning capacity through
its global and local links.
"Since we acquired capital in the Sealord Group, we have
forged our global foundation under the TGL, True Global Links
plan. But the global market has come to a point where our
global link can`t respond to all the demands. We need to coordinate
the global links closely with local links to create dual structure
to pursue profitability and further growth", said Kakizoe.
One of challenges the company faces is poor profits of seafood
and processed foods, said Kakizoe.
"King& Prince and Salmon Antartica fell short of
our expectations. Shrimp farming business in Indonesia didn`t
turn out as planned. We have already taken the necessary actions
and hope that will bring better results in a couple of years.
We aim to hit a target of \30 billion in operating profit
in 2011, and that`s quite attainable. We expect to increase
margin percentage of seafood and processed foods to 5%, which
is 2 to 3 % at present"
To avoid skinny margins Japan`s seafood giant also plan to
expand global markets. The company`s market ratio outside
of Japan is 18.3% and the Japanese seafood giant sees even
more shares abroad.
"Markets outside of Japan will constitute up to 30% by
2011. I don`t mean to take the Japanese market slightly, but
if we find it less attractive and penetrating, the share will
be even larger", said Kakizoe.
Asked what factor decides future M&As, he said sharing
values is vital.
"Since I became CEO in 1999, I have become keenly aware
how difficult it is for a Japanese firm to sell products outside
of the country. I have no intention of forcing our cultures
to overseas enterprises, but if we cannot reflect the same
values of do-the-right-thing attitude, we can never join hands",
Maruha Nichiro executives see future global
December 18, 2007
Yuji Igarashi, president of Maruha Nichiro Holdings and Tatsuhiko
Tanaka, chairman of the company said the integrated seafood
giant endured a relentless year in 2007 thanks to rising prices
of raw materials and weaker yen.
They told Suisan Times at Maruha Nichiro`s headquarter in
Tokyo last week.
"Prices of seafood raw materials are on the rise due
to growing demand worldwide and curbing quotas. Some species
have become double-priced. Inflationary fuel prices made fishing
operations more costly", Igarashi lamented.
Maruha`s first half sales were \363.6 billion, 2% shy of the
original target, while operating profits were \5.1billion,
64% achievement rate from the original projection. Seafood
sector gained \700 million compared to the previous year to
\272.5 billion. On the other hand, operating earnings decreased
"We have been in a harsh environment this year. The reason
behind the profit slide is higher trading costs of procurement,
while we never succeeded in jacking up selling prices domestically.
Quotas for the North-sea fishery decreased. Higher water temperatures
forced us to operate fishing in farther locations and high
quality surimi and fillet dwindled."
Nichiro`s performance will add to the company`s latter half
earnings and it expects sales will increase \112.5 billion
to \850 billion, it hopes its full business year operating
earnings will be \12.5 billion.
The newly born seafood giant eyes the global market and future
M&As for its future expansion.
"We secure raw materials from 70 companies worldwide.
We firmly believe our supplier should be of great advantage
of doing business with us. Therefore, it is necessary to sell
our products in Europe, as well. Sales of Maruha and Nichiro
overseas will exceed \100 billion. We won`t be able to enjoy
considerable amount of benefits unless we expand markets globally",
Tastuhiko Tanaka, chairman said the company will remain Maruha
and Akebono brands.
"Our products will be marketed under Maruha and Akebono.
Some people say it is simpler to use one corporate brand name,
but consumers recognize these brands more than our company
The merged company stresses the importance of synergy to develop
more attracting items.
"Processed foods are short-lived and we have to keep
on developing innovative items. For example, we need to think
how we can evolve Maruha`s surimi into new frozen foods"
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