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Sales During Last Fiscal Period at Nissui’s Frozen Food Division Likely to Add up to 70.1 Billion Yen, Representing an Increase of 1%

April 25, 2008

Sales to Industry, up 5%, Contribute to the Increase

72.4 Billion Yen Planned for This Fiscal Period

Apparently, Nippon Suisan Kaisha’s (the company is also known as Nissui) sales for the last fiscal period in the category of frozen foods has added up to 70.1 billion yen. This represents a 1% increase over the previous fiscal period. Its sales of consumer frozen food products fell by 3%, being affected by last summer's scandal surrounding products made by Tianyang Food and the loss of trust in products manufactured in China, but sales to the industrial sector, centered on six major categories, were strong for both the Wide-area Sales Department and the Local Area Sales Department: the latter increased by 5% returning an increase in profit.

The figures were disclosed on April 23 by Mr. Norio Hosomi, Director (Chief Operating Officer of Nissui’s Processed Food Business). Mr. Tetsuya Shindo, General Manager of the Household Foods Department and Mr. Eiichiro Yamahashi, General Manager of the Industrial Foods Department were also present at the meeting.

Sales of consumer frozen food were affected by the scandal surrounding Tianyang Food and decreased by 20% in February and by 19% in March. In April, the extent of the drop eased: sales dropped by a little over 10% that month, an indication of a recovery in the category. Sales to the industrial sector grew by 6% in February and 3% in March. This fiscal term, Nissui hopes to definitely attain an overall increase of 72.4 billion yen or 5%. The projected figures are based on securing a 5% increase in the industrial cooked products category, keeping sales at the same level as the last fiscal period in the cooked frozen food consumer products category, and a forecasted drop in revenue from frozen farm products.

With a single product that would generate sales of 10 billion yen in mind, Mr. Hosomi said: “We want to develop and strengthen a product with the potential to become Nissui’s “face (flagship.)”

The new Hachikan factory (in Hachinohe, Aomori Prefecture), which is due to be completed in early fall, has been earmarked as a base for manufacturing industrial food products, namely cream sauce based products and seafood-based products. Nissui plans to manufacture calamari tempura, mixed vegetable and seafood tempura, fried seafood, gratins, etc. there. The company will also invest more effort in revising prices because of the rising cost of and difficulties in procuring raw materials. In the price-revising exercise, the focus will be on improving or discontinuing products through specification changes, etc.

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