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Kyokuyo 3Q Cites Seafood Purchasing As Driving Force

February 6, 2014

Kyokuyo Co., Ltd., located in Tokyo under management of President Hisaki Tada, announced the results of the third quarter for FY March 2014. Sales were up 14.1 percent YOY to JPY 157.1 billion (€1.12 billion/$1.53 billion); operating earnings up 57.6 percent to JPY 2.875 billion (€20.6 million/$28 million); ordinary earnings up 50.5 percent to JPY 2.95 billion (€21.1 million/$28.8 million); and quarterly net income up 186 percent to JPY 2.724 billion (€19.5 million/$26.6 million).

The fiscal year forecast is up by 5.6 percent to JPY 188 billion (€1.35 billion/$1.83 billion); operating income hikes 33.4 percent to JPY 3.1 billion (€22.2 million/$30.2 million); ordinary earnings also jumps 37 percent to JPY 3.1 billion (€22.2 million/$30.2 million); and net income is JPY 3.3 billion (€23.6 million$32.2 million), up 160 percent.

The segment of marine food purchasing that reported swollen sales and profits functioned as a driving force in this quarter. Against a backdrop of steadily growing fish market prices the segment successfully expanded sales of highly profitable processed products, such as fillets of Pacific ocean perch, Atka mackerel, and mackerel, salt-preserved salmon, stretched shrimp, as well as salmon and shrimp for raw consumption.

The frozen food segment cited increased turnaround, but reduced profits. Products designed for raw consumption, chiefly sushi toppings, moved quite well and a boneless fish series, Dandori Jozu, was also accepted well as a medical food and a school lunch dish. Nonetheless, a weak yen, higher production costs, and relentless competition led earnings to fall short.

In the segment of shelf-stable food, canned saury and mackerel, imported canned goods and canned meat, and seafood delicacies were sold more to leading convenience store chains, resulting in a revenue increase; however, fueling raw material costs put pressure on profit and brought about decreased profit.

Conversely, the logistics segment reported contracted revenues and hiked profits. The cold storage unit upgraded aging facilities for the purpose of improved efficiency. With a drastically restructured fleet system, cold storage carrier business performed highly efficient operations mainly involving annual contract based fleet allocations.

Tuna business marked declines in revenue and proceeds. Despite the growing positive reputation of Company’s farmed tuna Honmaguro no Kiwame, the segment yet faced hardship in procuring young fries. In overseas purse seining, regardless of strong fish prices, catch amounts suffered due to a poor catch in inshore fisheries and decreased workdays.

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