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Nichirei Announces Significant Profit Growth Overseas

May 14, 2008

A favorable growth in distribution of low-temperature products and livestock business resulted in an increase in sales earnings of 463.5 billion yen, up by 1.3%, compared to last year at the same period. Operating profit declined by 4.4%, amounting to 17.3 million yen, as a result of stagnant sales of frozen food and acerola products. Ordinary profit was 16.8 million yen, down by 2.9%. Net profit was 11.3% lower, totaling 9.623 billion yen.

The Fishery Division Failed to Get out of Red

The fishery division’s sales volume showed a slight increase of 74.6 billion yen with a gain of 11 million yen. Operating loss, however, widened from 353 million to 455 million yen. “The fishery recovery plan” to promote more important products, helped secure the same sales volume as the previous year; stagnation of domestic shrimp market and processed food production business in Latin America hindered a further growth.

For this business term, the fishery division has forecasted the operating income of 200 million yen. The fishery recovery plan will be continuously implemented. Furthermore, the division considers the closing of a Hokkaido office as well as downsizing, aiming to constrict its fixed cost to 300 million yen.

The processed food division suffered sales and profit losses. Its sales volume was 1.3% lower, ending in 175 billion yen. Operating profit was 4.112 billion yen, down by 31.7%. Though professional grade frozen food showed a steady growth of 4.5%, repercussions of incidents of Meat Hope Co. and Tenyo Shokuhin created a considerable loss of 7.5% in sales of household frozen food.

The division of low-temperature product distribution benefited from business increases in distribution network and overseas ventures, and reported a total net income of 13.8 billion yen, up by 3.5%. Its operation profit was 17.7% higher, amounting to 8.5 billion yen. The overseas business, in particular, showed significant profit increases both in sales volume and operating profit, 26% and 118% respectively.

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