November 8, 2022
Consolidated Financial Results (Japanese Accounting Standards)
for the Six Months Ended September 30, 2022 (Q2 FY2022)
Company name: | House Foods Group Inc. |
Stock exchange listing: | Tokyo Stock Exchange |
Stock code: | 2810 |
URL: | https://housefoods-group.com |
Representative: | Hiroshi Urakami, President |
Contact: | Nobuhide Nakagawa, General Manager, Public & Investors Relations Division |
Tel. +81-3-5211-6039 |
Scheduled date for filing of securities report: | November 14, 2022 | ||||||||||||||||||||||||||
Scheduled date of commencement of dividend payment: | December 5, 2022 | ||||||||||||||||||||||||||
Supplementary documents for quarterly results: | Yes | ||||||||||||||||||||||||||
Quarterly results briefing: | Yes (for analysts and institutional investors) | ||||||||||||||||||||||||||
(Amounts of less than one million yen are rounded to the nearest million yen.) | |||||||||||||||||||||||||||
1. Consolidated Financial Results for the Six Months Ended September 30, 2022 (April 1, 2022 - September 30, 2022) | |||||||||||||||||||||||||||
(1) Consolidated Results of Operations (Accumulated Total) | (Percentages show year-on-year changes.) | ||||||||||||||||||||||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | ||||||||||||||||||||||||
owners of parent | |||||||||||||||||||||||||||
Six months ended | Million yen | % | Million yen | % | Million yen | % | Million yen | % | |||||||||||||||||||
September 30, 2022 | 133,831 | 7.8 | 7,632 | (15.5) | 8,964 | (13.3) | 5,493 | (23.8) | |||||||||||||||||||
September 30, 2021 | 124,127 | 0.4 | 9,032 | (8.8) | 10,336 | 16.9 | 7,211 | 625.2 | |||||||||||||||||||
(Note) Comprehensive income: | 10,217 million yen (4.6%) for the six months ended September 30, 2022 | ||||||||||||||||||||||||||
9,766 million yen (-%) for the six months ended September 30, 2021 | |||||||||||||||||||||||||||
Profit per share | Profit per share | ||||||||||||||||||||||||||
(basic) | (diluted) | ||||||||||||||||||||||||||
Six months ended | Yen | Yen | |||||||||||||||||||||||||
September 30, 2022 | 55.88 | - | |||||||||||||||||||||||||
September 30, 2021 | 72.00 | - | |||||||||||||||||||||||||
(2) Consolidated Financial Position | |||||||||||||||||||||||||||
Total assets | Net assets | Equity ratio | Net assets per share | ||||||||||||||||||||||||
As of | Million yen | Million yen | % | Yen | |||||||||||||||||||||||
September 30, 2022 | 387,072 | 299,922 | 69.6 | 2,763.23 | |||||||||||||||||||||||
March 31, 2022 | 382,021 | 298,567 | 70.4 | 2,700.99 | |||||||||||||||||||||||
(Reference) Shareholders' equity: | As of September 30, 2022: | 269,522 million yen | |||||||||||||||||||||||||
As of March 31, 2022: | 268,966 million yen | ||||||||||||||||||||||||||
2. Dividends | |||||||||||||||||||||||||||
Dividend per share | |||||||||||||||||||||||||||
End of | End of | End of | Year-end | Annual | |||||||||||||||||||||||
first quarter | second quarter | third quarter | |||||||||||||||||||||||||
Yen | Yen | Yen | Yen | Yen | |||||||||||||||||||||||
Year ended March 31, 2022 | - | 23.00 | - | 23.00 | 46.00 | ||||||||||||||||||||||
Year ending March 31, 2023 | - | 23.00 | |||||||||||||||||||||||||
Year ending March 31, 2023 | - | 23.00 | 46.00 | ||||||||||||||||||||||||
(forecasts) | |||||||||||||||||||||||||||
(Note) Revisions to dividend forecasts published most recently: None | |||||||||||||||||||||||||||
3. Consolidated Forecasts for the Fiscal Year Ending March 31, 2023 (April 1, 2022 - March 31, 2023) | |||||||||||||||||||||||||||
(Percentage figures represent the changes from the previous year) | |||||||||||||||||||||||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | Profit per | |||||||||||||||||||||||
owners of parent | share | ||||||||||||||||||||||||||
Million yen | % | Million yen | % | Million yen | % | Million yen | % | Yen | |||||||||||||||||||
Year ending March 31, 2023 | 275,300 | 8.6 | 16,000 (16.8) | 17,900 | (15.3) | 11,100 | (20.5) | 112.93 |
(Note) Revisions to financial forecasts published most recently: Yes
For details, please refer to "(3) Information on the Future Outlook, Including Consolidated Business Results Forecasts" under "1. Qualitative Information on Results for the First Half Ended September 30, 2022" on page 5 of the accompanying materials.
* Notes
-
Changes of important subsidiaries during the period
(changes of specific subsidiaries in accordance with changes in the scope of consolidation): Yes
New: 1 company (Company Name) House Foods Group Asia Pacific Co., Ltd. - Application of particular accounts procedures to the preparation of quarterly consolidated financial statements: Yes
- Changes in accounting policies and changes or restatement of accounting estimates
- Changes in accounting policies caused by revision of accounting standards: Yes
(ii) | Changes in accounting policies other than (i): | None |
(iii) Changes in accounting estimates: | None | |
(iv) | Restatement: | None |
(Note) Please refer to "2. Quarterly Consolidated Financial Statements and Key Notes (4) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies)" on page 12 of the Accompanying Materials for details.
- Number of shares outstanding (common shares):
- Number of shares outstanding at end of period (including treasury shares)
As of September 30, 2022: | 100,750,620 shares |
As of March 31, 2022: | 100,750,620 shares |
(ii) Number of treasury shares at end of period | |
As of September 30, 2022: | 3,211,704 shares |
As of March 31, 2022: | 1,169,959 shares |
(iii) Average number of shares outstanding during the term | |
Six months ended September 30, 2022: | 98,288,290 shares |
Six months ended September 30, 2021: | 100,154,885 shares |
- Quarterly consolidated financial results are not subject to a quarterly review by certified public accountants or audit corporations.
- Explanations and other special notes concerning the appropriate use of business results forecasts
- The forward-looking statements such as result forecasts included in this document are based on the information available to the Company at the time of the announcement and on certain assumptions considered reasonable, and the Company makes no representations as to their achievability. Actual results may differ materially from the forecast depending on a range of factors.
- For other matters related to the forecasts, please refer to "(3) Information on the Future Outlook, Including Consolidated Business Results Forecasts" under "1. Qualitative Information on Results for the First Half Ended September 30, 2022" on page 5 of the accompanying materials.
Accompanying Materials - Contents | ||
1. Qualitative Information on Results for the First Half Ended September 30, 2022 ................................................... | 2 | |
(1) | Details of Operating Results .......................................................................................................................... | 2 |
(2) | Details of Financial Position .......................................................................................................................... | 4 |
(3) | Information on the Future Outlook, Including Consolidated Business Results Forecasts.............................. | 5 |
2. Quarterly Consolidated Financial Statements and Key Notes .................................................................................. | 6 | |
(1) | Quarterly Consolidated Balance Sheets ......................................................................................................... | 6 |
(2) | Quarterly Consolidated Statements of Income and Comprehensive Income ................................................. | 8 |
(3) | Quarterly Consolidated Statements of Cash Flows ...................................................................................... | 10 |
(4) | Notes to Quarterly Consolidated Financial Statements ................................................................................ | 12 |
Notes Relating to Assumptions for the Going Concern ............................................................................... | 12 | |
Notes for Case Where Shareholders' Equity underwent Significant Changes in Value .............................. | 12 | |
Application of Particular Accounts Procedures to the Preparation of | ||
Quarterly Consolidated Financial Statements .............................................................................................. | 12 | |
Changes in Accounting Policies................................................................................................................... | 12 | |
Additional Information................................................................................................................................. | 12 | |
Segment Information.................................................................................................................................... | 13 | |
Important Subsequent Events ....................................................................................................................... | 14 | |
3. Supplementary Information .................................................................................................................................... | 16 | |
(1) | Business Results........................................................................................................................................... | 16 |
(2) | Number of Group Companies ...................................................................................................................... | 16 |
(3) | Consolidated Statements of Income ............................................................................................................. | 17 |
(4) | Consolidated Balance Sheets........................................................................................................................ | 21 |
(5) | Consolidated Statements of Cash Flows ...................................................................................................... | 21 |
(6) | Capital Investment ....................................................................................................................................... | 22 |
(7) | Depreciation ................................................................................................................................................. | 22 |
(8) | Major Management Indicators, etc............................................................................................................... | 22 |
(9) | Reference Information.................................................................................................................................. | 23 |
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1. Qualitative Information on Results for the First Half Ended September 30, 2022
(1) Details of Operating Results
During the first six months ended September 30, 2022, the business environment was quite volatile, with the resumption of economic activity after COVID-19 giving rise to a supply-demand gap and the protracted Russia-Ukraine conflict triggering global inflation and a sharp depreciation of the yen, and the outlook remained fraught with uncertainty.
Net sales for the first six months ended September 30, 2022 increased 7.8% year on year to 133,831 million yen, reflecting the timely implementation of price revisions for certain products and services in addition to recovery of sales in each business, including growth in the International Food Business, as a result of the resumption of economic activity. Operating profit was significantly affected by the sharp rise in raw material prices in the Spice/Seasoning/Processed Food Business, and declined 15.5% year on year to 7,632 million yen. Ordinary profit declined 13.3% year on year to 8,964 million yen, while profit attributable to owners of parent was 5,493 million yen, down 23.8% year on year.
The following is an overview of results by segment (before the elimination of inter-segment transactions).
Consolidated net sales | Consolidated operating profit | ||||||
Segment profit (loss) | |||||||
Segment | |||||||
Amount (million yen) | Year-on-year change | Amount (million yen) | Year-on-year change | ||||
(%) | (%) | ||||||
Spice / Seasoning / | 58,013 | 101.8 | 3,205 | 59.3 | |||
Processed Food Business | |||||||
Health Food Business | 8,521 | 121.1 | 1,076 | - | |||
International Food Business | 22,620 | 116.4 | 3,106 | 96.2 | |||
Restaurant Business | 22,947 | 103.8 | 647 | 123.0 | |||
Other Food Related Business | 26,387 | 115.4 | 521 | 65.1 | |||
Subtotal | 138,489 | 107.8 | 8,555 | 88.9 | |||
Adjustment (elimination) | (4,658) | - | (923) | - | |||
Total | 133,831 | 107.8 | 7,632 | 84.5 | |||
(Note) 1. Adjustment (elimination) | comprises profit | or loss not distributed | to segments and the elimination | of inter-segment | |||
transactions. |
Spice / Seasoning / Processed Food Business
The Spice/Seasoning/Processed Food Business is working to increase the efficiency of the Group as a whole and strengthen proposal making capabilities through measures such as transferring part of the business of Malony Co., Ltd. to House Foods Corporation with effect from April 2022.
Looking at the net sales of the household use business, sales of retort pouched products and snacks held firm and sales of curry roux products were also solid amid concern over sinking consumer sentiment due to rising inflation. The net sales of the food service business were still below pre-COVID levels but were on the recovery path and higher than the level a year earlier.
Meanwhile, profits decreased, severely impacted by dramatic deterioration in conditions in terms of cost, notably rising raw material and energy costs. In response to such deteriorating cost conditions, the Spice/Seasoning/Processed Food Business has been implementing timely product price revisions and working to accelerate the firm establishment of the new prices.
As a result of the above, sales in the Spice/Seasoning/Processed Food Business stood at 58,013 million yen, up 1.8% year on year, and operating profit was 3,205 million yen, down 40.7% year on year. As a result, the ratio of operating profit to net sales was 5.5%, declining 4.0 percentage point from the same period of the previous fiscal year.
Health Food Business
In this business segment, we are promoting structural reforms domestically and working to quickly build the Functional Ingredients Value Chain globally.
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In terms of net sales, sales of Ukon no Chikara increased year on year as a result of the easing of COVID restrictions and sales of key jelly products also grew, reflecting the effect of integration of sales functions into House Foods Corporation and their adoption as food products for people recovering from COVID-19 infection by local governments. Thanks to the effect of increased sales, in addition to the results of structural reforms being implemented for some time, the Heath Food Business returned to operating profitability.
As a result of the above, net sales in the Health Food Business rose 21.1% year on year to 8,521 million yen with operating profit of 1,076 million yen, an improvement of 1,409 million yen year on year. Consequently, the ratio of operating profit to net sales was 12.6%, rising 17.4 percentage points from a year earlier.
International Food Business Period covered by the consolidated financial statements: Mainly from January to June 2022
In this business segment we have strived to accelerate the speed of growth in three priority areas (United States, China and ASEAN).
In the United States, the tofu business, which accounts for around 90% of all business, posted increased sales, partly due to price revisions implemented in January 2022; however, this was not enough to offset higher costs, including logistics and labor costs, and profit fell. Meanwhile, the import business, which accounts for the remaining 10% of business in the United States, reported large declines in sales and profit due to container shipping delays associated with supply chain disruptions and higher logistics costs.
The results of the curry business in China strongly reflected the effects of the Chinese authorities' "zero COVID policy." The household use business posted gains in sales and profit thanks to favorable exchange rates in addition to the firm establishment of price revisions implemented in April 2022, both of which offset the impact of rising raw material costs. In addition, certain House Foods products were adopted as government food rations during the Shanghai lockdown and this is expected to increase the popularity of curry as a meal option. However, the food service business posted declines in sales and profit, with lockdowns inevitably leading to decreased orders. As a result, the curry business in China as a whole reported increased sales and decreased profit.
The functional beverage business in Thailand reported increases in both sales and profits, with a campaign to celebrate the 10th Anniversary of the core C-vitt brand boosting results and the vitamin beverage market remaining on a growth path.
As a result of the above, sales in the International Food Business rose 16.4% year on year, to 22,620 million yen, and operating profit decreased 3.8%, to 3,106 million yen. Consequently, the ratio of operating profit to net sales was 13.7%, declining 2.9 percentage points from a year ago.
Restaurant Business Periods covered by the consolidated financial statements: From March to August 2022 for Ichibanya Co., Ltd. and from January to June 2022 for overseas subsidiaries
The Restaurant Business is focusing on further growth both in Japan and overseas through chains of restaurants which constantly exceed expectations, whilst at the same time adapting to changes in the environment in the COVID era and meeting needs for greater convenience.
Net sales at existing domestic stores of Ichibanya Co., Ltd. rose 4.5% year on year, reflecting gradual recovery in the number of customers after requests to shorten business hours were fully lifted in late March and no change in customer levels despite price revisions in June. Net sales at existing overseas stores increased 11.8% overall, though conditions varied from region to region, with sales exceeding pre-COVID levels in the United States but hit by prolonged lockdowns in China, which is adhering to a zero COVID strategy.
Operating profit rose year on year, bolstered by higher sales, which offset the impact of negative factors such as rising costs including raw material and logistic costs and lower sales from overseas subsidiaries due to lockdowns in China.
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House Foods Group Inc. published this content on 08 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 November 2022 06:13:04 UTC.