Nippn : Consolidated Financial Results for FY2023 and Forecast for FY2024 552KB

Consolidated Financial Results for FY2023 and Forecast for FY2024 [J-GAAP]

				May 12, 2023
Listed company name:	NIPPN CORPORATION
Listing:	The Prime Market of Tokyo Stock Exchange
Code number: 2001	URL:	https://www.nippn.co.jp/	TEL:	03-3511-5307
Representative:	Toshiya Maezuru, President and Chief Operating Officer
Contact:	Koichiro Fukuyama, General Manager of Corporate Communications Group

Date of the general meeting of shareholders:	June 29, 2023
Payment date of cash dividends:	June 30, 2023
Filing date of financial statements:	June 29, 2023
Supplementary materials prepared:	Yes
Results information meeting held:	Yes
	*Amounts less than one million yen have been rounded down.

1. Consolidated financial results for the year ended March 31, 2023 (From April 1, 2022 to March 31, 2023)

(1) Consolidated operating results

(Millions of yen, percentage figures show the rates of change from the previous year.)

	Net Sales			Operating Income		Ordinary Income	Profit Attributable to
					Owners of Parent
FY2023	365,525		13.8%	12,288		8.9%		14,816		3.8%		10,260	10.0%
FY2022	321,317		11.4%	11,282		8.8%		14,270		12.7%		9,327	8.0%
(Note) Comprehensive income:	FY2023: ¥17,481 million (39.7%)	FY2022: ¥12,514 million (-6.1%)
	Profit per Share		Fully Diluted Profit	ROE (%)		Ordinary Income to		Operating Income to
	(Yen)			per Share (Yen)			Total Assets (%)		Net Sales (%)
FY2023		132.16		115.39			5.7				4.4			3.4
FY2022		121.59		106.02			5.5				4.5			3.5
(Reference) Equity in earnings of affiliated companies: FY2023: ¥309 million	FY2022: ¥237 million

(2) Consolidated financial position

						(Millions of yen)
		Total Assets	Net Assets	Equity Ratio		Net Assets per Share
		(%)		(Yen)
FY2023		344,606	192,613	54.8		2,421.48
FY2022		325,869	178,697	53.4		2,268.30
(Reference) Equity capital:	FY2023: ¥188,687 million	FY2022: ¥174,120 million

(3) Consolidated cash flows

(Millions of yen)

	Cash Flows from	Cash Flows from	Cash Flows from	Cash and Cash
	Equivalents at the End of
	Operating Activities	Investing Activities	Financing Activities
	the Year
FY2023	15,055	(5,026)	(8,402)	33,157
FY2022	11,975	(10,103)	(4,278)	31,215

2. Dividends

		Dividends per Share			Total Amount	Dividend	Dividends on
			(Yen)				of Cash	Payout Ratio	Net Assets
	1Q-end	2Q-end	3Q-end	Year-end	Full Year		Dividends	(Consolidated)	(Consolidated)
		(Millions of yen)	(%)	(%)
FY2022	―	18.00	―	20.00	38.00	2,923	31.3	1.7
FY2023	―	19.00	―	21.00	40.00	3,124	30.3	1.7
FY2024 (Forecast)	―	20.00	―	20.00	40.00			28.9

3. Forecast of consolidated business results for FY2024 (From April 1, 2023 to March 31, 2024)

(Millions of yen, percentage figures show the rate of changes from the same period of the previous year.)

	Net Sales		Operating Income	Ordinary Income	Profit Attributable to	Profit per Share
		Owners of Parent	(Yen)
Half Year	191,000		8.2%	6,300	8.1%	7,400	2.6%	5,100	2.8%	65.45
Full Year	387,000		5.9%	12,500	1.7%	14,600	(1.5)%	10,800	5.3%	138.60

* Notes

1. Significant changes in subsidiaries during the term (changes in specified subsidiaries in accordance with changes in the scope of consolidation): None
2. Changes in accounting policies, accounting estimates and retrospective restatements

1)	Changes in accounting policies due to revisions of accounting standards:	Yes
2)	Changes other than 1):	None
3)	Change in accounting estimates:	None
4)	Retrospective restatements:	None

(3) Number of shares issued and outstanding (common stock)

1. Number of shares outstanding at the end of each period (including treasury shares):
2. Number of treasury shares at the end of each period:
3. Average number of shares:

FY2023	78,824,009 shares	FY2022	78,824,009 shares
FY2023	860,850 shares	FY2022	2,021,404 shares
FY2023	77,633,189 shares	FY2022	76,712,872 shares

(Reference) Summary of Non-consolidated Financial Results

1. Non-consolidated financial results for the year ended March 31, 2023 (From April 1, 2022 to March 31, 2023)

(1) Non-consolidated operating results

(Millions of yen, percentage figures show the rates of change from the previous year.)

	Net Sales	Operating Income	Ordinary Income		Profit
FY2023	225,014	16.3%	8,942		(5.8)%	11,613		(7.1)%		3,414		(66.6)%
FY2022	193,558	6.9%	9,489		(2.3)%	12,496		17.8%		10,222		34.7%
	Profit per Share (Yen)	Fully Diluted Profit per
	Share (Yen)
FY2023		43.88			38.23
FY2022		132.93			115.96
(2) Non-consolidated financial position
										(Millions of yen)
	Total Assets	Net Assets	Equity Ratio		Net Assets per Share
	(%)			(Yen)
FY2023		271,119			158,797			58.5				2,030.01
FY2022		257,369			150,552			58.4				1,953.89
(Reference) Equity capital:	FY2023: ¥158,570 million		FY2022: ¥150,357 million

• These consolidated financial results are outside the scope of audit.
• Explanation regarding the appropriate use of projected financial results and other special instructions
  Descriptions regarding the future, including the financial outlook contained in this material, are based on certain information currently available to the Company and particular assumptions, which are, at the discretion of the Company, deemed reasonable, and actual financial results may significantly vary due to various factors. Please refer to "1. Overview of Financial Results (1) Overview of business results for the fiscal year under review 2) Future outlook" on page 4 for information on preconditions underlying the above outlook and other related information.

NIPPN CORPORATION (2001) Consolidated Financial Results for FY2023

Contents
1. Overview of Financial Results	2
(1)	Overview of business results for the fiscal year under review	2
(2)	Overview of financial position for the fiscal year under review	5
(3)	Basic policy on profit distribution and dividends for the year ended March 31, 2023 and the year
	ending March 31, 2024	7
2. Basic Approach to the Selection of Accounting Standards	7
3. Consolidated Financial Statements	8
(1)	Consolidated balance sheets	8
(2)	Consolidated statements of income and comprehensive income	10
	(Consolidated statements of income)	10
	(Consolidated statements of comprehensive income)	12
(3)	Consolidated statements of changes in net assets	13
(4)	Consolidated statements of cash flows	15
(Segment information, etc.)	17
(Revenue recognition)	18
(Per share information)	19
(Important subsequent events)	19

1

NIPPN CORPORATION (2001) Consolidated Financial Results for FY2023

1. Overview of Financial Results

1. Overview of business results for the fiscal year under review
2. 1. Business results for the fiscal year under review

				(Millions of yen)
	Fiscal 2022	Fiscal 2023	Difference	Change
Net sales	321,317	365,525	44,208	113.8%
Operating income	11,282	12,288	1,006	108.9%
Ordinary income	14,270	14,816	545	103.8%
Profit attributable	9,327	10,260	932	110.0%
to owners of parent

During the fiscal year ended March 31, 2023, the Japanese economy was on a recovery track as economic activity showed renewed vitality amid indications that the COVID-19 pandemic was abating. In view of persistently high manufacturing and logistics costs, reflecting soaring prices of raw materials and energy owing to such factors as financial market fluctuations due to the yen's sharp depreciation and worsening labor shortages, in addition to the Russo-Ukraine situation and other geopolitical risks, the impact of price hikes on consumption is a concern. Thus, the outlook for business confidence remains uncertain,

The business environment of the food industry is becoming increasingly severe in light of soaring raw materials prices and other factors, despite signs of a modest increase in the tempo of personal consumption.

In these circumstances, under our management philosophy of "contributing to the realization of a sustainable society by pursuing the well-being (happiness, health, and smiles) of people," we are working with our customers, employees, shareholders, society, and other stakeholders to create future-focused value. In addition to cost reductions through operational improvements, we are striving to strengthen our business foundation by further bolstering sales of mainstay products through upfront investments to expand sales and by enhancing our competitive advantage by providing high-value-added products and services. Furthermore, to help realize a sustainable society, we have been developing ingredients such as plant-based foods with excellent credentials in terms of sustainability and applying them to existing home-use and frozen food products. For example, SOYL PRO is a soybean-based food whose development involved application of tofu processing technology.

We are strengthening the framework for contributing to the realization of a sustainable society. In this regard, we announced our endorsement of the Task Force on Climate-related Financial Disclosure (TCFD) in February 2023. On the environmental front, we are expanding the use of paper containers to reduce plastic waste while also promoting introduction of solar power generation equipment.

Consolidated net sales for the fiscal year under review increased by 13.8% year on year to ¥365,525 million, reflecting the implementation of sales price revisions in response to rising raw materials prices and various other costs, in addition to a continuing recovery in demand, following the relaxation of restrictions on activities. In terms of profit, despite repeated increases in raw materials prices and various other costs and an increase in strategic costs for sales expansion, operating income increased by 8.9% to ¥12,288 million, ordinary income increased by 3.8% to ¥14,816 million, and profit attributable to owners of parent increased by 10.0% to ¥10,260 million, reflecting an increase in shipments due to a recovery in demand mainly in the restaurant sector and cost reductions due to improved productivity.

2

NIPPN CORPORATION (2001) Consolidated Financial Results for FY2023

The performance of individual business segments was as follows.

Flour Milling

				(Millions of yen)
	Fiscal 2022	Fiscal 2023	Difference	Change
Net sales	96,934	117,604	20,669	121.3%
Operating income	6,211	7,528	1,316	121.2%

The Group is strengthening quality control in response to the growing preoccupation with the safety and security of food throughout society. At the same time, to address customer needs and diversifying food preferences, the Group promoted sales initiatives with a view to resolving the issues that concern customers.

Moreover, we strove to strengthen relationships with customers and enhance sales capabilities and brand power while stepping up sales activities, in order to seize every opportunity associated with the recovery of demand in the aftermath of the COVID-19 pandemic. In the Flour Milling business, sales were higher than the levels for the previous year, mainly because of the wheat flour price revision and a robust trend in sales prices of wheat bran, a by-product.

In line with the increase of government sales prices (tax inclusive) of imported wheat by 17.3% on average for the five key products in April 2022, we revised the prices of wheat flour products for professional use from June 2022. However, as the Japanese government has not changed the sales prices since October 2022, we did not change the prices of wheat flour products for professional.

As a result, net sales for the Flour Milling segment increased by 21.3% year on year to ¥117,604 million, and operating income increased by 21.2% to ¥7,528 million.

Food

				(Millions of yen)
	Fiscal 2022	Fiscal 2023	Difference	Change
Net sales	185,911	204,796	18,885	110.2%
Operating income	4,068	3,449	(619)	84.8%

In the professional-use category, sales of products were higher than the level for the previous year, because demand showed a tendency to recover owing to the relaxation of the restrictions on activities and in reaction to the decline in previous years reflecting the government's request to large commercial facilities, restaurants, etc. to shorten opening hours, and because of price revisions in response to rising prices of raw materials and other items.

In the home-use product category, although demand for products for consumption at home associated with people refraining from going out ran its course, sales of products in this category were higher than the level for the previous year, owing to price revisions in 2022.

In the frozen foods category, in addition to buoyant shipments of commercial-use frozen foods reflecting the recovery in demand from the restaurant sector, demand for home-use frozen foods, such as the One Plate Meal series of complete meals consisting of a main dish and staples in a tray and the Trendy Meal series of rice dishes, was brisk. In addition, the revision of prices of home-use frozen foods in 2022 also contributed to higher sales. As a result, sales of products in this category were higher than the level for the previous year.

In the ready-made meals business, sales were higher than the level for the previous year because of recovery of demand in line with the relaxation of the restrictions on activities.

As a result, net sales of the Food segment increased by 10.2% year on year to ¥204,796 million, while operating income decreased by 15.2% to ¥3,449 million.

3