May 23, Hiroshi Sawada Chairman and President, Chief Executive Officer, and Chief Operating Officer

Transcription

1 Code number : 2001 Briefing Session on Fiscal Year ended March 31, 2012 (FY2012) Business Results and the Medium-term Business Plan May 23, 2012 Hiroshi Sawada Chairman and President, Chief Executive Officer, and Chief Operating Officer Nippon Flour Mills Co., Ltd.

2 Sustainable Growth Trajectory (1) (Millions of yen) Net sales (Millions of yen) (FY) (Forecast) (Forecast) Commenced first phase of restructuring Completed second phase of restructuring Completed third phase of restructuring Completed fourth phase of restructuring Medium-term Business Plan New Nippn Way 05/07 Medium-term Business Plan 08/09 Medium-term Business Plan SG100 10/11 Medium-term Business Plan SG130 12/13 Medium-term Business Plan SG130 Phase II 2

3 Sustainable Growth Trajectory (2) Commenced first phase of restructuring Completed second phase of restructuring Completed third phase of restructuring Completed fourth phase of restructuring Medium-term Business Plan New Nippn Way 05/07 Medium-term Business Plan 08/09 Medium-term Business Plan SG100 10/11 Medium-term Business Plan SG130 12/13 Medium-term Business Plan SG130 Phase II Net sales Operating income Ordinary income Net income FY , , FY ,188 2,928 3,034 1,754 FY ,541 3,716 3,418 2,339 FY ,883 3,831 3,790 2,010 FY ,389 5,059 4,469 2,430 FY ,777 7,443 6,585 4,606 FY ,360 8,158 7,605 4,737 FY ,421 7,285 7,620 4,837 FY ,575 6,329 6,578 4,146 FY ,737 6,706 6,729 3,810 FY ,797 10,682 9,736 4,829 FY ,586 12,549 12,802 7,892 FY ,139 10,567 10,827 6,026 FY ,094 9,634 10,210 6,235 FY2013 (Forecast) FY2014 (Forecast) 276,000 10,500 11,000 6, ,000 13,000 13,000 7,800 3

4 Returning Profits to Shareholders NIPPN maintains a prudent approach toward its internal reserves taking into consideration the need to strengthen its corporate structure, prepare for future business development, and respond to changes in its operating environment. Every effort is made to ensure the stable and continuous payment of dividends, The payment of dividends is based on a thoroughgoing assessment of NIPPN consolidated performance and financial position. Trends in Dividends per Share (Yen) FY2013 (Forecast) Payout ratio (consolidated) 21.9% 24.9% 24.3% 28.5% 30.9% 27.7% 21.2% 27.7% 32.0% 25.4% 4

5 SG130 Three Basic Strategies (1) Further emphasis on low-cost operations (2) Review the business structure and business portfolio (3) Strengthen management for total optimization of the Group s operations Bolstering corporate capabilities while solidifying sustainable growth 5

6 Responding to Large-scale Disasters <The Great East Japan Earthquake> Established an emergency response headquarters in the immediate aftermath of the earthquake Arranged for the delivery of relief supplies and put in place a structure and systems to ensure the stable supply of products Incurred minor damage to a portion of NIPPN s facilities at its Yokohama and Chiba Mills (flour milling) as well as its Ryugasaki Plant (premixes and frozen foods) Achieved a resumption of full operations within an extremely short period of time Limited impact on performance <Relief supplies> <The floods in Thailand> Operations at NIPPN (Thailand) Co., Ltd. suspended mid-october due to flood damage Secured continuous, stable supply to customers through contract manufacturing in Thailand and imports from Japan Commenced plant restoration work in December; work completed in March Recommenced progressive shipments from April Limited impact on performance attributable in part to insurance compensation <The NIPPN (Thailand) Co., Ltd. Plant> 6

7 Background behind SG130 Phase II Phase I Results 1) Reenergized the Group s organization through widespread acceptance of the in-house company system 2) Enhanced the speed of commercialization of large-scale capital investments exceeding 20 billion 3) Secured improvements in earnings through new cost-cutting measures based on new methods 4) Entered business fields that boast significant growth potential overseas 5) Strengthened Group companies through comprehensive, optimal management Phase I Pending Issues 1) Quantitative targets yet to be achieved 2) Need to further bolster the Group s ability to address changes in its business environment 7

8 <Three Basic Strategies> (1) Further Emphasis on Low-cost Operations Carry out effective management based on vertical organizations under the in-house company system Enhance the speed of commercialization of capital investments aimed at improving the Group s structure Propose and carry out new cost-cutting measures by introducing new methods 8

9 Capital Expenditures for Structural Reform Completion Now Part of Our Capacity Large-scale capital investments amounting to a total of 20 billion Buckwheat Flour, Buckwheat Mix Kaminokawa Plant of Matsuya Flour Mills Co., Ltd. Rice Flour Kaminokawa Plant of Mizuho Foods Co., Ltd. Seasoned Fried Tofu (Soybean Processed Food) Amagi Plant 2 of OK Food Industry Co., Ltd. Premix (Overseas) NIPPN (Thailand) Co., Ltd. Completion of construction: October 2011 Relocation from Utsunomiya Plant for consolidation Completion of construction: March 2011 Doubled production capacity (1,000t / year 2,000t / year) Full-scale rice flour business operation Completion of construction: March 2011 Production capacity increased Improved production efficiency Completion of construction: October 2010 Production capacity increased by 70% (12,000t / year 20,000t / year) Improved production efficiency Flour Milling Kobe-Konan Mill of Nippon Flour Mills Co., Ltd. Expansion of the flour mill, construction of a new silo for raw materials Increased production capacity (13,000t / year 24,000t / year) Start of work: June 2012 Scheduled completion of work: September 2012 Frozen Food Ryugasaki Plant of NIPPN Frozen Foods Co., Ltd. Expansion and relocation from Takasaki Plant for consolidation Streamlined equipment Increased production capacity Completion of construction: March 2012 Pet Food Chiba Plant of NPF Japan Co., Ltd. Expansion and improvements Increased production capacity Enhanced productivity Completion of construction: March

10 Toward Further Enhancing Productivity Upgrade and expand own raw material wheat silos Increase storage capacity for raw material wheat (current capacity of 200,000 tons to 300,000 tons, an increase of 50%) Progressively commence upgrading and expanding on completion of preparations Approximate investment of 10 billion Chiba, Kobe-Konan (stage 2 construction), Fukuoka, and Chita Mills (provisional name) Chiba Mill Kobe-Konan Mill Fukuoka Mill Chita Mill (provisional name) 10

11 Toward Further Sustainable Growth Construction of the Chita Mill (provisional name) The early commencement of construction currently under consideration Ideal location allowing direct berthing of large-scale vessels Nagoya Mill Nagoya City 247 Tokai City Chita City, Aichi Prefecture Kitahamamachi Asakura Construction site of a new mill Nagoya port 155 Chita City Tokoname City 11

12 <Three Basic Strategies> (2) Review the Business Structure and Business Portfolio Reexamine the potential and profitability of existing businesses Employ a category-leader strategy by channeling management resources on growth businesses Develop new business fields 12

13 Group Strengths A comprehensive cereal manufacturer An abundant lineup and high technical capabilities Flour Corn flour Buckwheat flour Rice flour Soy beans Japan s first mechanical flour milling company The only manufacturer among major flour milling companies Traditional Nikko Soba (buckwheat noodle) brand Draw out the flavor and taste using production methods that take into account application Pursue the full potential of soybeans to deliver genuine delight Functional materials Flaxseed Natural cosmetics Pan-no-hana <Ceramide> Delivering functional food ingredients that boast moisturizing, anti-aging, and other beneficial properties Supporting beauty and health through an abundant lineup that leads the industry Offering beauty and well-being derived from plants A cultural business filled with dreams nurtured by wheat paste 13

14 Product Development Anticipating Costumer Needs New Merveille Business-use flour made from wheat grown in France that has a rich taste Oh my Pasta Sauce Roux Renewal The industry s first pasta sauce in block form Oh my Paella Stock New A genuine culinary delight that can be prepared using only a frying pan Meat Sauce Cream Sauce Oh my Premium Frozen Spaghetti Dishes New Rice Flour Mix Series New Flour produced entirely in Japan enjoyed in the home Handy Pack Series New Convenient and easy to prepare professional quality Carbonara Bolognese Genuine taste easily prepared using a microwave Okonomiyaki Pancake Mixes Containing Rice Flour Rice Flour Cake Mixes 14 Flour For Use In Making pizzas Oh my Tempura Premix

15 Strengthening the Life Care Business Human life care Pet life care Health food business Sport business Pan-no-hana business (Manufacture and sales of wheat paste*) *Pan-no-hana classes are not included Functional materials Pet food business Pamace Ceramide Lignin Functional materials business 15

16 The Delicatessen Business Basic strategy = Supply every possible business-use ingredient for the deli market Business-use ingredient Wheat flour, buckwheat flour, Tempura mix, Japanese deep-fried chicken (Karaage) mixes, pasta, premixes, frozen pastry dough, seasoned fried tofu, etc. Feedback on market needs Menu proposals Supermarket and convenience stores headquarters Supermarkets and convenience stores Nationwide deli operators other than Fast Foods Co., Ltd. Fast Foods Co., Ltd. Musashi Plant Narashino Plant Hachioji Plant (In addition to the above, plants cover the Tohoku, Tokai, and Chubu regions) 16

17 <Three Basic Strategies> (3) Strengthen Management for the Group s Total Optimization Adopt a Group management perspective for total optimization Bolster Group management through channeling resources into strategic business areas 17

18 Asia Thailand and China Overseas Business (1) Tianjin Chuan Shun Foods., Ltd. Manufacture and sale of premix products Shanghai Tianjin Nippon Flour Mills (Shanghai) Co., Ltd. Manufacture and sale of premix products Expanding sales channels within Thailand and to surrounding countries including Indonesia, Malaysia, and the Philippines Bangkok NIPPN (Thailand) Co., Ltd. Manufacture and sale of premix products Acquired HACCP, HALAL, and other certification Nippon Flour Mills (Thailand) Co., Ltd. Sales of premix and other products Increase in the number of R&D center personnel, increase in floor space 18

19 Overseas Business (2) U.S. Wheat field in Montana Canada PASTA MONTANA, L.L.C. Manufacture and sale of pasta products Japan Montana California NIPPN California Inc. Sales of food ingredients in the North American market 19

20 12/13 Medium-term Business Plan Overview of SG130 phase II Long-term vision (consolidated basis) Net sales: 500 billion Operating income: 25 billion Numerical targets for the final year of SG130 (consolidated basis) Net sales: Operating income: 300 billion 13 billion Sustainable Growth Further emphasis on low-cost operations SG130 phase II SG130 phase I FY2014 Accelerate the pace of sustainable growth Achieve numerical targets FY2013 A year in which to fully assess changes in the business environment Strengthen fundamental earnings power FY2011 to FY2012 Build a foundation that is capable of strengthening fundamental earnings power 12/13 Medium-term Business Plan SG130 phase II Challenge Review the business structure and business portfolio Strengthen management for total optimization of the Group s operations 20

21 Code number : 2001 Overview of Fiscal Year ended March 31, 2012 (FY2012) Business Results and FY2013 Forecasts May 23, 2012 Masayuki Kondo Managing Director Nippon Flour Mills Co., Ltd.

22 Fiscal 2012 Consolidated Business Results Highlights 1) Increase in net sales due mainly to sales price hikes and sales volume growth 2) Achieved ordinary income in excess of 10 billion for the third consecutive fiscal year despite the impact of market conditions on operating income 3) Secured net income growth and continuous sustainable growth 4) Declared an additional commemorative dividend of 2.0 per share to mark the Company s 115th anniversary 22

23 Consolidated Statements of Income FY2011 FY2012 YoY (Millions of yen) Vs. net sales Vs. net sales Change Change (%) Flour Milling 91, % 100, % 8, % Net sales Food 132, % 140, % 7, % Other 27, % 27, % % Total 252, % 269, % 16, % Operating income Flour Milling 4, % 3, % (579) (3.2)% Food 6, % 5, % (736) (11.9)% Other (21) (0.0)% % Total 10, % 9, % (932) (8.8)% Ordinary income 10, % 10, % (616) (5.7)% Net income 6, % 6, % % ROE 6.2% 6.2% 0.0pt EPS

24 Analysis of Factors for Changes in Net Sales Factors for changes in net sales (overall increase of 16,955 million) Changes in the volume of wheat flour sales 2,600 Revision of sales prices 5,900 Changes in wheat bran sales 200 Changes in buckwheat flour and other sales 200 Changes in premix sales 1,300 Changes in frozen foods sales 800 Changes in delicatessen (300) Changes in pasta sales 300 Factors contributing to an increase in consolidated subsidiaries 4,400 Changes in other food sales 1,100 Changes in engineering-related sales (750) Changes in pet foods sales (50) Changes in other sales 1,250 10,000 5,000 8,911 7,590 (Millions of yen) Flour Milling Food Other YoY Note: Please refer to consolidated financial report supplementary explanation materials for details. 24

25 Analysis of Factors for Changes in Operating Income Factors for changes in operating income (overall decrease of 932 million) Changes in sales volume 660 Fluctuations in market conditions (1,580) Fluctuations in sales, manufacturing, and other operating costs 340 Changes in food sales 80 Fluctuations in sales, manufacturing, and other operating costs (820) Fluctuations in pet food profitability 155 Fluctuations in sales, manufacturing, and other operating costs (500) (1,000) (Millions of yen) (579) (736) Flour Milling Food Other Note: Please refer to consolidated financial report supplementary explanation materials for details. YoY 25

26 Analysis of Factors for Changes in Ordinary income/ Net income Factors contributing to changes in ordinary income 10,827 10,567 million 9,634 million 10,210 Factors contributing to changes in net income (Millions of yen) (932) (30) 40 (616) million 6,026 10,827 million 10,210 million (1,295) 1,230 6,235 (616) 902 (10) million 26

27 Consolidated Balance Sheets (Assets) (Millions of yen) FY2011 (As of Mar. 31, 2011) Component ratio FY2012 (As of Mar. 31, 2012) Component ratio Change Factors for changes Current assets 80, % 84, % 4, pt Tangible assets 70, % 74, % 3, pt Increase of inventories Increase of capital investment Intangible fixed assets Investments and other assets 1, % 1, % (188) (0.1)pt 42, % 42, % (179) (1.0)pt Fixed assets 114, % 117, % 3,615 (0.7)pt Total assets 194, % 202, % 8,539 - Note: Please refer to consolidated financial report supplementary explanation materials for details. 27

28 Consolidated Balance Sheets (Liabilities and Net Assets) (Millions of yen) FY2011 (As of Mar. 31, 2011) Component ratio FY2012 (As of Mar. 31, 2012) Component ratio Change Factors for changes Current liabilities 63, % 63, % (58) (1.4)pt Long-term liabilities 30, % 35, % 4, pt Total liabilities 94, % 98, % 4, pt Common stock 12, % 12, % - (0.3)pt Additional capital surplus 11, % 10, % (724) (0.6)pt Retained earnings 68, % 72, % 3, pt Treasury stock, at cost (2,313) (1.2)% (1,577) (0.8)% pt Valuation and translation adjustments 7, % 8, % pt Minority interests 2, % 2, % (60) (0.1)pt Total net assets 100, % 104, % 4, pt Total liabilities and net assets 194, % 202, % 8,539 - Note: Please refer to consolidated financial report supplementary explanation materials for details. 28

29 Consolidated Statements of Cash Flows (Millions of yen) FY2011 FY2012 Change Cash flows from operating activities 15, (15,910) Cash flows from investing activities (6,673) (11,412) (4,739) Cash flows from financial activities (1,580) (638) 941 Effect of exchange rate changes on cash and cash equivalents (26) (39) (13) Increase (decrease) in cash and cash equivalents 7,673 (12,048) (19,722) Cash and cash equivalents at beginning of the year 14,283 21,956 7,673 Decrease in cash and cash equivalents resulting from exclusion of subsidiaries from consolidation - (59) (59) Cash and cash equivalents at end of the year 21,956 9,848 (12,107) Major factors contributing to an Changes in cash flows from operating activities = Increase of inventories Major factors contributing to an Changes in cash flows from investing activities = Capital investment Major factors contributing to an Changes in cash flows from financial activities = Increase of long-term debt 29

30 Forecast for the Year ending March 31, 2013 Result FY2012 FY2013(Forecast) YoY Vs. net sales (%) Forecast Vs. net sales (%) Change (Millions of yen) Change (%) Flour Milling 100, % 100, % (745) (0.7)% Net sales Food 140, % 148, % 7, % Other 27, % 28, % % Total 269, % 276, % 6, % Flour Milling 3, % 3, % (7) (0.2)% Operating income Food 5, % 6, % % Others % % 39 - Total 9, % 10, % % Ordinary income 10, % 11, % % Net income 6, % 6, % % ROE 6.2% 6.2% 0.0pt EPS

31 Analysis of Factors for Changes in Net Sales Forecasts Factors for changes in net sales forecasts (overall increase of 6,906 million) Sales volume 2,650 Sales price (3,400) Sales volume 7,500 Sales volume 150 9,000 7,479 4,000 (1,000) (Millions of yen) 173 (745) Flour Milling Food Other YoY Note: Please refer to consolidated financial report supplementary explanation materials for details. 31

32 Analysis of Factors for Changes in Operating Income Forecasts Factors for changes in net sales forecasts (overall increase of 866 million) Changes in costs, etc. (400) Sales volume 410 Changes in costs, etc. 430 Sales volume 400 Changes in costs, etc. 30 Sales volume (100) (Millions of yen) (7) Flour Milling Food Other 39 Note: Please refer to consolidated financial report supplementary explanation materials for details. YoY 32

33 Analysis of Factors for Changes in Ordinary Income/ Net income Forecasts Factors for changes in ordinary income forecasts (Millions of yen) FY2012 ordinary income Changes in operating income 10,210 9,634 million 10,500 million 866 Interest income / dividend income (100) Foreign exchange gains 100 Others (76) FY2013 ordinary income 11, million Factors for changes in net income forecasts FY2012 net income Changes in ordinary income Extraordinary losses FY2013 net income 6,235 10,210 million 11,000 million 6, (525) million 33

34 Inquiries This document includes details of the Company s current plans and performance forecasts. These future plans and forecast figures are based on information currently available as well as the Company s plans and projections. Actual results and performance may differ materially from these plans and forecast figures due to a variety of conditions and factors. This document does not represent a definitive commitment or guarantee by the Company to achieve stated plans and forecast figures. Investor Relations Office Accounting and Finance Div. Nippon Flour Mills Co., Ltd. TEL 03(3350)2356 FAX 03(3356)