[PPT] - F ir st Half of the F isc al Ye ar E nding F e br uar y 2018 PowerPoint Presentation

SLIDE 1

F ir st Half of the F isc al Ye ar E nding F e br uar y 2018 (1H F Y2/ 18) Re sults Br ie fing

(2918) Oc to b e r 11, 2017

WARABE YA NI CHI YO HOL DI NGS CO., L T D.

SLIDE 2

Ove r vie w of F inanc ial Re sults for 1H F Y2/ 18 and F ull- ye ar F

r

e c ast for F Y2/ 18 (Consolidate d Basis)

2

SLIDE 3

Consolidate d financ ial r e sults for 1H F Y2/ 18

1H F Y2/ 17 1H F Y2/ 18 Yo Y Vs F

re c a st

a t b e g inning o f F Y

Re sults F

re c a st

a t b e g inning o f F Y

Re sults Ne t sale s

109,658

(100.0)

113,700

(100.0) 112,300

(100.0)

2,641

<2.4>

1,400

<-1.2>

Ope r ating inc ome

3,027

(2.8)

3,400

(3.0) 3,211

(2.9)

184

<6.1>

188

<-5.5>

Or dinar y inc ome

3,287

(3.0)

3,550

(3.1) 3,576

(3.2)

288

<8.8>

26

<0.8>

Pr

fit

(attr ibutable to

wne r

s of par e nt)

1,644

(1.5)

2,350

(2.1) 2,147

(1.9)

502

<30.6>

202

<-8.6>

E PS (Ye n)

(attr ibutable to

wne r

s of par e nt)

93.78 133.99

122.44

28.66

11.55

3 (Millio ns o f ye n)

*F ig ure s in ( ) sho w sa le s ra tio , a nd fig ure s in < > sho w c ha ng e (%). E stima te s fo r 1H F Y2/ 18 a nno unc e d o n April 14, 2017.

SLIDE 4

F

r

e c ast and diffe r e nc e fac tor s

1H F Y2/ 18 Vs. F

re c a st

F

re c a st

a t b e g inning o f F Y

Re sults Ne t sale s

113,700 (100.0)

112,300 (100.0)

1,400

<-1.2>

[Diffe re nc e fa c to rs] F

o d Pro duc ts Busine ss
1,090

Chille d b e nto me a l b o xe s

730

Bre a d pro duc ts

630

F

o d I

ng re die nts, L

g istic s,

Othe r Busine sse s

300

[Diffe re nc e fa c to rs] F

o d Pro duc ts Busine ss
210

F

o d I

ng re die nts, L

g istic s,

Othe r Busine sse s +20

1H F Y2/ 18 Vs. F

re c a st

F

re c a st

a t b e g inning o f F Y

Re sults Ope r ating inc ome

3,400

(3.0)

3,211

(2.9)

188

<-5.5> 4

*F ig ure s in ( ) sho w sa le s ra tio , a nd fig ure s in < > sho w c ha ng e (%). E stima te s fo r 1H F Y2/ 18 a nno unc e d o n April 14, 2017. (Millio ns o f ye n) (Millio ns o f ye n)

SLIDE 5

Consolidate d ne t sale s by se gme nt (YoY)

1H F Y2/ 17

1H F Y2/ 18

Cha ng e Cha ng e fa c to rs T

tal ne t

sale s

109,658

112,300

2,641 <2.4> F

o d

Pro d uc ts

85,820

88,257

2,437 <2.8> Stro ng sa le s o f o nig iri ric e b a lls a nd c hille d Ja pa ne se swe e ts F

o d

Ing re d ie nts

13,318

13,092

225

<-1.7> L

we r sa le s o f fish ro e a nd

pro c e sse d c hic ke n pro d uc ts L

g istic s

7,490

7,532

41 <0.6> Slo wing sa le s g ro wth in c o mb ine d d istrib utio n b usine ss supplying Se ve n- E le ve n Othe r

3,029

3,417

387 <12.8> Rising o rd e rs in te mpo ra ry sta ffing b usine ss

85,820 88,257 13,318 13,092 7,490 7,532 3,029 3,417 109,658 112,300 30,000 60,000 90,000 120,000 1H F Y2/ 17 1H F Y2/ 18

F

od Produc ts Busine ss

F

od Ingr

e dients Busine ss L

gistic s Busine ss

Othe r Businesse s

(Millions of ye n)

5

*F ig ure s in < > sho w c ha ng e (%). (Millio ns o f ye n)

SLIDE 6

Consolidate d ope r ating inc ome by se gme nt (YoY)

1H F Y2/ 17

1H F Y2/ 18

Cha ng e

T

tal ope r

ating inc ome

3,027

3,211

184 <6.1> F

o d Pro d uc ts

2,414

2,855

441 <18.3> F

o d Ing re d ie nts

232

272

40 <17.3> L

g istic s

143

57

86

<-60.1> Othe r 263

325

61 <23.2> Inte r-se g me nt tra nsa c tio ns

27
299
272

<–>

(Millio ns o f ye n) * F ig ure s in < > sho w c ha ng e (%). (Millio ns o f ye n)

(Millio ns o f ye n)

2,414 2,855 232 272 143 57 263 325

27
299

3,027 3,211

300

1,700 3,700

1H F Y2/ 17 1H F Y2/ 18

F

od Produc ts

Busine ss F

od Ingre die nts

Busine ss L

g istic s

Busine ss Othe r Busine sse s Inte r-se g me nt tr a nsa c tions

(Millions of ye n)

Hig he r de pre c ia tio n c o sts, le a se e xpe nse s -120 Hig he r ric e pric e s -280 Othe r +90 De c line in sa le s pro mo tio n c o sts +230 I nc re a se in la b o r c o sts -350 I mpro ve me nt in pro duc tivity, c ha ng e s to pro duc t sta nda rds +400 Sa le s g ro wth +210

6

Ne gative impac t on profits

750

Positive impac t on profits +930

T

tal YoY: appr
x. +180

SLIDE 7

Non- ope r ating inc ome / e xpe nse s and e xtr aor dinar y inc ome / losse s (YoY)

1H F Y2/ 17

1H F Y2/ 18

Cha ng e

Ope r ating inc ome

3,027 (2.8)

3,211 (2.9)

184 <6.1>

Non- ope r ating inc ome

483 (0.4)

532 (0.5)

48 <10.0>

Non- ope r ating e xpe nse s

223 (0.2)

167 (0.1)

56

<-25.1>

Or dinar y inc ome

3,287 (3.0)

3,576 (3.2)

288 <8.8>

E xtr aor dinar y inc ome

– (–)

– <–>

E xtr aor dinar y losse s

450 (0.4)

562 (0.5)

112 <25.0>

Pr

fit be for

e inc ome taxe s

2,837 (2.6)

3,013 (2.7)

176 <6.2>

T

tal inc ome taxe s

1,193 (1.1)

866 (0.8)

326

<-27.3>

Pr

fit

(a ttr ibuta ble to owne r s of pa r e nt)

1,644 (1.5)

2,147 (1.9)

502 <30.6> (E xtra o rd ina ry lo sse s) Pre vio us fisc al ye a r: 450

Nic hiyo : Pro visio n fo r lo ss o n b usine ss o f

sub sid ia rie s a nd a sso c ia te s d ue to fixe d a sse t impa irme nt lo sse s fo r F re vo F a rm Co ., L td . Curre nt fisc al ye a r: 560

Wa ra b e ya Nic hiyo : Impa irme nt lo sse s

re la te d to K ushiro Pla nt 370

Nic hiyo : Pro visio n o f a llo wa nc e fo r

d o ub tful a c c o unts re la te d to Nic hima n 180 (Yo Y c ha ng e in ta x e xpe nse s)

320

Applic a tio n o f ta x e ffe c t a c c o unting fo r pro visio ns re la te d to F re vo F a rm Co ., L td .

370

Applic a tio n a t pre vio us fisc al ye a r-e nd +150 Applic a tio n in c urre nt fisc al ye a r

210

7

*F ig ure s in ( ) sho w sa le s ra tio , a nd fig ure s in < > sho w c ha ng e (%). (Millio ns o f ye n)

SLIDE 8

Consolidate d balanc e she e ts (YoY)

[Asse ts] E nd-F Y2/ 17

E nd- 1H F Y2/ 18

Cha ng e

Cur r e nt asse ts

36,316

38,584

2,267

Non- c ur r e nt asse ts

47,561

50,572

3,011

[Pr

pe r

ty, plant and e quipme nt]

[41,427]

[44,080]

[2,653]

[Intangible asse ts]

[920]

[962)

[42]

[Inve stme nts and othe r asse ts]

[5,213]

[5,529]

[315]

T

tal asse ts

83,877

89,157

5,279

[L iabilitie s and ne t asse ts] E nd-F Y2/ 17

E nd- 1H F Y2/ 18

Cha ng e

Cur r e nt liabilitie s

26,660

30,689

4,028

Non- c ur r e nt liabilitie s

14,040

13,998

41

[Inte r e sting- be ar ing de bt]

[12,730]

[13,510]

[779]

T

tal liabilitie s

40,700

44,688

3,987

T

tal ne t asse ts

43,176

44,468

1,291

[Re taine d e ar nings]

[26,858]

[28,301]

[1,442]

T

tal liabilitie s

and ne t asse ts

83,877

89,157

5,279 8

(Millio ns o f ye n) (Millio ns o f ye n)

SLIDE 9

Consolidate d state me nts of c ash flows for 1H F Y2/ 18

1H F Y2/ 18

Pro fit b e fo re inc o me ta xe s

3,013

De pre c ia tio n

2,471

De c re a se (inc re a se ) in no te s a nd a c c o unts re c e iva b le – tra d e

3,682

De c re a se (inc re a se ) in inve nto rie s

693

Inc re a se (d e c re a se ) in no te s a nd a c c o unts pa ya b le – tra d e

2,226

Inc re a se (d e c re a se ) in a c c o unts pa ya b le – o the r

792

Othe r

455 Subtotal 5,971

Inc o me ta xe s pa id

473

Othe r

297 Cash flows fr

m ope r

ating ac tivitie s 5,794

Purc ha se o f pro pe rty, pla nt a nd e q uipme nt

3,899

Othe r

757

Cash flows fr

m inve sting ac tivitie s
4,656

Cash flows fr

m financ ing ac tivitie s
2,190

E ffe c t of e xc hange r ate c hange on c ash and c ash e quivale nts

120

Ne t inc r e ase (de c r e ase ) in c ash and c ash e quivale nts

1,172

Cash and c ash e quivale nts at the be ginning of pe r iod 10,937 Cash and c ash e quivale nts at the e nd of pe r iod 9,764

9

(Millio ns o f ye n)

SLIDE 10

Consolidate d financ ial for e c ast for F Y2/ 18 (vs. F

re c a st a t be g inning of F

Y)

F

re c a st a t b e g inning o f F

Y 1H F Y2/ 18 2H F Y2/ 18 F Y2/ 18 Ne t sa le s 113,700 (100.0) 107,300 (100.0) 221,000 (100.0) Ope ra ting inc o me 3,400 (3.0) 1,200 (1.1) 4,600 (2.1) Ord ina ry inc o me 3,550 (3.1) 1,150 (1.1) 4,700 (2.1) Pro fit

(a ttrib uta b le to

wne rs o f pa re nt)

2,350 (2.1) 150 (0.1) 2,500 (1.1) Re vise d fo re c a st 1H F Y2/ 18 Re sults 2H F Y2/ 18 F Y2/ 18 112,300 (100.0) 107,300 (100.0) 219,600 (100.0) 3,211 (2.9) 939 (0.9) 4,150 (1.9) 3,576 (3.2) 874 (0.8) 4,450 (2.0) 2,147 (1.9) 353 (0.3) 2,500 (1.1) Diffe re nc e F a c to rs 1H F Y2/ 18 Re sults 2H F Y2/ 18 F

re c a st

F Y2/ 18 F

re c a st

1H F Y2/ 18 ◆ Ne t sa le s

Gro wth we a ke r tha n e xpe c te d in F
o d Pro duc ts Busine ss

(Sa le s o f c hille d b e nto me a l b o xe s, sa le s in Chukyo re g io n misse d g uida nc e ta rg e ts) ◆ Ope ra ting inc o me

Ca pa c ity utiliza tio n ra te s a t so me pla nts lo we r tha n e xpe c te d
I

nc re a se in ing re die nt pric e s

2H F Y2/ 18

◆ Ne t sa le s

In line with sta rt o f ye a r g uida nc e

◆Ope ra ting inc o me

De la ys in impro ving pro fita bility a t ne w pla nts
Inc re a se in ing re die nt pric e s

Ne t sa le s

1,400

<-1.2> <0.0>

1,400

<-0.6> Ope ra ting inc o me

188

<-0.2>

261

<-0.2>

450

<-0.2> Ord ina ry inc o me 26 <0.0>

276

<-0.3>

250

<-0.1> Pro fit

(a ttrib uta b le to

wne rs o f pa re nt)
202

<-0.2> 202 <0.2> <0.0>

10

*F ig ure s in ( ) sho w sa le s ra tio , a nd fig ure s in < > sho w c ha ng e (%).

(Millio ns o f ye n) (Millio ns o f ye n)

SLIDE 11

Stra te g ie s Going F

rwa rd

Initia tive s for 2H F Y2/ 18

11

SLIDE 12

Addr e ssing issue s that e me r ge d in 1H F Y2/ 18

12

Shortfa ll in sa le s in F

od Produc ts Busine ss

1. Sa le s o f c hille d b e nto me a l b o xe s misse d g uida nc e ta rg e t

Ha mb urg e r b o xe d me a ls switc he d fro m c hille d c a te g o ry to

20oC c a te g o ry

I

nte nsifying c o mpe titio n

2. Sa le s in Chukyo re g io n misse d g uida nc e ta rg e t

De c line in sa le s sha re due to inte nsifying c o mpe titio n

SLIDE 13

Ke y initiative s for 2H F Y2/ 18: F

od Pr
duc ts Busine ss－c hille d be nto me al boxe s

13

(1) Re ne w po pula r b a sic c hille d b e nto me a l b o xe s

Po rk c utle t ric e b o wl (ka tsu-do n): o ve rha ul ing re die nt pro c ure me nt a nd pre pa ra tio n pro c e sse s

→Re duc e pric e s while ma inta ining fla vo r

Chic ke n a nd e g g ric e b o wl (o ya ko -do n): c ha ng e ka e shi sa uc e b a se (mixture o f so y sa uc e , sug a r a nd mirin)

→Improve quality and flavor

1. Initiative s to addr

e ss sale s shor tfall for c hille d be nto me al boxe s

Pre mium po rk c utle t ric e b o wl ¥580 (inc l. ta x) Spe c ia l po rk c utle t ric e b o wl (–) Chic ke n a nd e g g ric e b o wl with fluffy e g g ¥450 (inc l. ta x) Chic ke n a nd e g g ric e b o wl with fluffy e g g ¥450 (inc l. ta x)

SLIDE 14

Ke y initiative s for 2H F Y2/ 18: F

od Pr
duc ts Busine ss－c hille d be nto me al boxe s

14

(2) L a unc h ne w pro duc ts (Curry with frie d minc e d c utle t, spic y shrimp ric e b o wl, ric e o me le t, e tc .)

Curry with frie d minc e d c utle t ¥498 (inc l. ta x) Spic y shrimp ric e b o wl (pla nne d) ¥498 (inc l. ta x)

1. Initiative s to addr

e ss sale s shor tfall for c hille d be nto me al boxe s

SLIDE 15

15

(1) Re info rc e pro duc t de ve lo pme nt syste m (de plo y pe rso nne l)

→Maintain recovery trend in market share →Reinvigorate and grow sales and profits

2. Initiative s to addr

e ss sale s in Chukyo r e gion Ke y initiative s for 2H F Y2/ 18: F

od Pr
duc ts Busine ss－Chukyo r

e gion

SLIDE 16

2. Initiative s to addr

e ss sale s in Chukyo r e gion

16

(2) L a unc h ne w pro duc ts

Ke y initiative s for 2H F Y2/ 18: F

od Pr
duc ts Busine ss－Chukyo r

e gion Ma inta in re c o ve ry tre nd in ma rke t sha re L a y g ro undwo rk fo r turna ro und fro m 2H F Y2/ 18

Mixe d o nig iri ric e b a lls with dire c tly wra ppe d se a we e d (c hic ke n) (jika ma ki ma ze me shi o musub i) ¥130 (inc l. ta x) Ava ila b le fro m Aug ust 14 F luffy white b a it ric e me a l (fukkura shira su g o ha n) ¥298 (inc l. ta x) Ava ila b le fro m Se pte mb e r 5 Grille d c hic ke n b e nto me a l b o x (ke ic ha n ya ki) ¥498 (inc l. ta x) Ava ila b le fro m mid-No ve mb e r

Re info rc e o nig iri ric e b a ll pro duc t de ve lo pme nt Re ne w lo c a l spe c ia lty pro duc ts Jo int initia tive s with Nic hiyo Co ., L td. Pro duc e lo c a lly fo r lo c a l c o nsumptio n

SLIDE 17

Initiative s to tac kle unde r lying issue s

Co ntinue to ta ke o n tra ine e s fro m o ve rse a s
Ro ll o ut wo rk style re fo rms to re ta in sta ff
I

mple me nt furthe r shift to a uto ma tio n a nd la b o r- sa ving syste ms

I

n-house production → procurement from external supplie rs

17

Issue 1: L abor shor tage , r ising labor c osts Issue 2: Rising ingr e die nt pr ic e s

Re vie w pro duc t sta nda rds

SLIDE 18

L

ng- te r

m initiative s

18

1. E

xpa nd into ne w c a te g o rie s

T e st sa le s o f smo o thie s sta rte d a t five sto re s in T

kyo me tro po lita n a re a

(fro m Se pte mb e r 26)

2. Co ntinue to inve st to drive g ro wth

→I

nsta lle d ne w c hille d b e nto me a l b o xe s pro duc tio n line a t Sa g a miha ra Pla nt (Oc to b e r 2017)

→Install new chilled b e nto me a l b o xe s pro duc tio n line a t Sa ka i Pla nt

(sc he d ule d fo r Ma rc h 2018)

→Install ne w c hille d Ja pa ne se swe e ts pro duc tio n line a t Na g o ya Pla nt

(sc he d ule d fo r June 2018)

→Expand Tokyo Plant (scheduled for November 2018) →Open temperature-c o ntro lle d b usine ss site in I

ruma (o pe ra tio ns sc he dule d to sta rt F e b rua ry 2018)

3. L

a unc h fo o d lo ss pro je c t

F ulfill c o rpo ra te so c ia l re spo nsib ility a nd impro ve pro fit ma rg ins

SLIDE 19

Othe r initiative s

19

1. Cha ng e in inve stme nt sta ke

As o f Oc to b e r 11, 2017 Oc to b e r 2017 (pla nne d ) Ja nua ry 2019 (pla nne d)

19.3％ 90％ 100％

2. PD sc he dule d to b e c o me a c o nso lida te d sub sidia ry in F

Y2/ 19

(Re fe re nc e ) PD’ s F Y3/ 17 re sults Ne t sa le s: US$25.933 millio n (ro ug hly ¥2.9 b illio n) Ope ra ting inc o me : US$2.102 millio n (ro ug hly ¥0.23 b illio n)

1 USD＝113 JPY

De c ision take n to make Pr ime De li Cor por ation (PD) a subsidiar y WPM F

ods* to suc c e ssive ly ac quir

e additional shar e s in PD

*WPM F

o d s is a jo int ve nture b e twe e n a US sub sid ia ry o f Mitsui & Co ., L

td . a nd the Co mpa ny's who lly o wne d US sub sid ia ry WARABE YA U.S.A., INC. T he Co mpa ny ha s a sta ke o f 70% in the jo int ve nture

SLIDE 20

Me dium- te r m manage me nt plan (c onsolidate d)

(R e vise d e a r ning s for e c a st)

6.0 6.9 3.5 5.4 6.0 7.3 7.8 0.0 8.0

2019 2019.2 .2期

Aiming fo r ROE

f 8%
r hig he r

ROE

(%)

8%

20

*F

re c a sts fo r F

Y2/ 19 a nd F Y2/ 20 a s o f April 18, 2017

(Billio ns o f ye n)

186.5 201.6 209.1 214.3

221.0 230.0 242.0

3.95 4.50 3.33 4.30

4.70 5.50 6.10

2.27 2.77 1.42 2.28

2.50 3.30 3.70

0.0 4.0 8.0 0.0 100.0 200.0

F Y2/ 14 F Y2/ 15 F Y2/ 16 F Y2/ 17 F Y2/ 18 F Y2/ 19 F Y2/ 20

Ne t sa le s Ordina ry inc o me Pro fit

Ma r. 2013 Sa g a miha ra Pla nt No . 2 (No w c a lle d the De sse rt Pla nt) De c . 2013 Ka g a wa Pla nt

Jun. 2014

Ura wa Pla nt Ma y 2015 I wa te Pla nt

(Pla n*) (Pla n*)

SLIDE 21

GROUP PHI L OSOPHY

We will c o ntrib ute to the he a lthy a nd e njo ya b le e a ting ha b its o f o ur c usto me rs b y pro viding a se nse o f sa fe ty a nd pe a c e o f mind in a dditio n to va lua b le pro duc ts a nd se rvic e s.

Othe r a ffilia te d c ompa nie s

Nic hiyo F r e sh Co., L td. Sun F

ods Yokokur

a Co., L td. Nic hima n Co., L td. Be ijing Wa nt- Ya ng F

ods L

td. Be ijing Riya ng Xinr

ng Co., L

td. WPM F

ods, L

L C

Ja pa n Ove r se a s