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  • 1. Results Briefing May 10, 2012Completing Reinforcement of the Operating Base in the Final Year of the Medium-Term Business Plan FY12/3 Results and FY13/3 Forecasts (Stock code: 2871) Nichirei Corporation Tel: (+81-3) 3248-2167 E-mail: tanakah@nichirei.co.jp URL: http://www.nichirei.co.jp/english/ir/index.html
  • 2. Table of ContentsSummary of Consolidated Results Logistics FY12/3 Results 1 Initiatives and Forecasts for FY13/3 8 FY13/3 Forecasts 2 TC to Expand Steadily, Freight Forwarding Function to Be Enhanced 9 in Transport BusinessProcessed Foods Bolstering Operating Base Through Investments in Higashi-Ogishima 10 Initiatives and Forecasts for FY13/3 3 DC No. 2 Building and in Kansai Area Favorable Selling Environment in Major Markets; 4 Operations in Europe Solid, Expanding the Operating Base in China 11 Sales Expected to Expand with the Establishment of Second Center Sales to Be Increased, Driven by Processed Chicken. 5 The Thai Subsidiary to Minimize Risk in Domestic Sales Reference Materials 12-16 Progress of Our Overseas Sales Strategy 6 Reference DataMarine Products & Meat and Poultry Initiatives and Forecasts for FY13/3 7 Notes 1) Figures shown in the graphs and charts in this presentation, unless otherwise specified, have been rounded to the unit indicated. Certain figures have also been rounded up or down 2) “Previous forecasts” are forecasts announced on February 7, 2012. Estimated values, or “E” symbols, indicate forecasts for this term announced on May 8, 2012.
  • 3. Summary of Consolidated Results Consolidated Results: FY12/3 Results Unit: 100 million y en (amounts less than 100 million y en are rounded off, some fractional amounts have been adjusted) Full year Change from p revious Change from FY11/3 forecast Actual 1. Net Sales Amount Ratio Previous Change Sales in Processed Foods and Logistics, the core forecast businesses, rose 8% and 7%, respectively. Overall net Processed Foods 1,742 123 8% 1,740 2 sales increased 4% year on year. Marine Products 657 -12 -2% 655 2 2. Operating Income Meat and Poultry Products 756 -27 -3% 735 21 A significant adverse effect from a contract renewal for a Logistics 1,495 101 7% 1,500 -5 rental building in the Real Estate segment was partly Real Estate 49 -17 -25% 51 -2 offset by a large increase in income in Processed Foods. Other 60 -2 -3% 60 0 Overall, operating income declined ¥0.5 billion. Adjustment -210 5 - -221 11 3. Recurring Income, Net IncomeTotal Ne t Sale s 4,549 171 4% 4,520 29 There were no effects from extraordinary income/losses, Processed Foods 52 5 12% 50 2 including a loss on revision of retirement benefit plan, Marine Products 2 -4 -62% 6 -4 posted for FY11/3. As a result, net income increased ¥3.9 Meat and Poultry Products 5 1 35% 6 -1 billion. Logistics 74 1 1% 73 1 4. Other Real Estate 24 -12 -34% 21 3 (1)Acquisition of treasury stock: The acquisition of 15 Other 5 1 16% 4 1 million shares, the target of the medium-term business Adjustment 0 2 - 0 0 plan, was completed in February 2012.Total Ope rating Income 162 -5 -3% 160 2 (2)Issuance of bonds: To ensure stable, long-term access to capital, ¥20.0 billion of bonds were issued in SeptemberRe curring Income 153 -9 -5% 149 4 2011.Ne t Income 79 39 95% 81 -2 ROE 7% 3% 7% - EPS 26 yen 13 yen 101% 27 yen -1 yen 1
  • 4. Summary of Consolidated Results Consolidated Results: FY13/3 Forecasts Unit: 100 million y en (amounts less than 100 million y en are rounded off, some fractional amounts have been adjusted) Q2 (Cumulative) Total (Q3 and Q4) Full year Change from Change from Change from FY12/3 Forecast FY12/3 Q1-Q2 Forecast FY12/3 Q3-Q4 Forecast Amount Ratio Amount Ratio Amount Ratio Processed Foods 922 53 6% 928 56 6% 1,850 108 6% Marine Products 336 9 3% 354 24 7% 690 33 5% Meat and Poultry Products 390 14 4% 390 10 3% 780 24 3% Logistics 766 18 2% 770 23 3% 1,536 41 3% Real Estate 25 -1 -4% 25 1 6% 50 1 1% Other 29 0 1% 32 0 1% 61 1 1% Adjustment -115 -6 - -112 -11 - -227 -17 - Total Ne t Sale s 2,353 87 4% 2,387 104 5% 4,740 191 4% Processed Foods 28 2 9% 32 6 23% 60 8 16% Marine Products 3 -1 -26% 4 6 - 7 5 214% Meat and Poultry Products 4 1 23% 4 2 101% 8 3 52% Logistics 36 -1 -1% 40 3 7% 76 2 3% Real Estate 10 -2 -19% 11 -0 -2% 21 -3 -11% Other 1 -1 -47% 2 -1 -32% 3 -2 -38% Adjustment -2 -2 - 0 -1 - -2 -2 - Total Ope rating Income 80 -3 -4% 93 15 19% 173 11 7% Re curring Income 77 -1 -1% 88 14 18% 165 12 8% Ne t Income 49 7 16% 51 14 38% 100 21 27% ROE 8% 1%1. Net Sales: Sales are expected to rise in Processed Foods, Logistics, Marine Products, and EPS 34 yen 8 yen29% Meat and Poultry Products. Total net sales are forecast to increase 4% year on year.2. Operating Income: Operating income is projected to climb in Processed Foods, Marine Products, Meat and Poultry Products, and Logistics. Total operating income is forecast to increase ¥1.1 billion year on year.3. Recurring Income, Net Income: There will be no effects from extraordinary losses (loss on valuation of investment securities) posted in the previous fiscal year. As a result, we expect that net income will rise ¥2.1 billion year on year. 2
  • 5. Processed Foods
  • 6. Processed Foods Initiatives and Forecasts for FY13/3 Unit: 100 million yen (amounts less than 100 million yen are rounded off, some fractional amounts have been adjusted) FY12/3 FY13/3 Full year Q2 (Cumulative) Total (Q3 and Q4) Full year Change from p revious Change from Change from Change from FY11/3 Change from FY12/3 forecast FY12/3 Q1-Q2 FY12/3 Q3-Q4 Actual Forecast Forecast Forecast Previous Amount Ratio Change Amount Ratio Amount Ratio Amount Ratio forecast Total Net Sales 1,742 123 8% 1,740 2 922 53 6% 928 56 6% 1,850 108 6% Pre-Cooked Frozen Foods Processed Foods for Household Use 521 41 9% 514 7 265 7 3% 269 6 2% 534 13 2% Pre-Cooked Frozen Foods for Commercial Use 811 40 5% 805 6 410 12 3% 429 16 4% 839 28 3% Health Value 50 2 3% 54 -4 31 2 7% 30 9 44% 61 11 22% Other 360 40 13% 367 -8 216 32 17% 200 24 14% 416 56 16% Operating Income 52 5 12% 50 2 28 2 9% 32 6 23% 60 8 16% FY11/3 Operating income 461. FY12/3 Results Factors for decrease -26 (1) Net sales increased a substantial 8%. As demand for meals cooked at home and home-meal replacement increased obviously after the Rise in raw material and purchase prices -20 earthquake, Nichirei expanded sales of pre-cooked foods, especially chicken. As a result, sales of pre- Effect of the results of GFPT Nichirei -4 cooked frozen foods for household use rose a large 9%, which was higher than the growth rate in the Others -2 market, and sales of pre-cooked frozen foods for commercial use increased 5%. Factors for increase 32 (2) Operating income rose ¥0.5 billion. Initiatives including improvements in purchases of raw materials 12 An increase in raw material costs was smaller than expected. Operating income increased with the higher Increase in sales of pre-cooked frozen foods 9 costs offset by initiatives including improvements in purchases, a rise in sales, the improvement of Productivity improvement in domestic plants 6 productivity, and other factors. Reduction of fixed costs 52. FY13/3 Forecasts (1) Aiming to increase net sales 6% year on year FY12/3 Operating income 52 We expect that the environment will remain unchanged from the previous year for pre-cooked frozen foods Factors for decrease -5 both for household use and for commercial use. We aim to increase net sales ¥10.8 billion by continuing to Rise in raw material and purchase prices -4 expand sales of chicken, selling products to meet the needs for meals to be cooked at home and home-meal Others -1 replacement, and sales of processed chicken breast meat to be produced in Thailand for Europe. Factors for increase 12 (2) Aiming to increase operating income ¥0.8 billion to achieve the target of the medium-term Increase in sales of pre-cooked frozen foods 5 business plan, ¥6.0 billion Effect of the results of GFPT Nichirei 3 We expect the costs of certain raw materials, especially rice, will rise. We will offset the increased costs Productivity improvement in domestic plants 2 through an increase in sales, the improvement of the operation of GFPT Nichirei, and the improvement of productivity. Others 3 FY13/3 Operating income 60 3
  • 7. Processed Foods Favorable Selling Environment in Major Markets; Sales Expected to Expand% Changes in behavior after the earthquake Year-on-year changes in sales in the home-meal replacement market40 16.0% Goods sold at convenience stores35 33 Increased Decreased 12.0% 8.0%30 27 26 4.0%25 21 0.0%20 18 -4.0% 13 1415 12 6.0% 4.0% Deli counters of supermarkets10 6 6 2.0%5 0.0% 1 2 10/4 10/5 10/6 10/7 10/8 10/9 11/1 11/2 11/3 11/4 11/5 11/6 11/7 11/8 11/9 12/1 12/2 12/3 10/10 10/11 10/12 11/10 11/11 11/12 -2.0%0 -4.0% Women Men Women Men Women Men -6.0% -8.0% Eating at home Stock of frozen foods Frequency of eating frozen foods Source:Data announced by the Japan Franchise Association and the Japan Chain Stores Association have been processed by Nichirei. Source:Data announced by the Japan Frozen Food Association have been processed by Nichirei.1. The markets for meals cooked at home and home-meal replacement are expanding, partly due to changes in purchasing behavior after the Great East Japan Earthquake. The markets are the main targets of Nichirei, and Nichirei expects to record higher sales than in the previous year by responding accurately to the needs in the expanding markets.2. Nichirei will seek to expand sales of processed chicken products, the mainstays. Meanwhile, Nichirei will respond to the needs in markets by launching large-volume products (including Grilled Chicken) for household use to meet demand for meals to be cooked at home, and sets (QuickMade series), which can readily be cooked for deli counters and restaurants, for commercial use.3. Nichirei will continue to improve profitability by focusing on the main product categories and improve productivity at plants. 4
  • 8. Processed Foods Sales to Be Increased, Driven by Processed Chicken. The Thai Subsidiary to Minimize Risk in Domestic Sales Changes in the Amount of Sales of Processed Production Volume of GFPT Nichirei by Destination (FY12/3 = 100) Chicken Products at Nichirei Sales (in the Japanese Market) Unit: 100 million yen Sales of processed 550 550 160 products for Europe 526 140 Sales of processed products for Japan 500 495 500 120 Sales of chicken in Thailand 450 452 450 100 439 425 427 80 400 400 393 60 362 350 350 40 313 20 300 300 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E Fiscal year 0 12/3 13/3E 14/3P 15/3P Fiscal year1. Sales of processed chicken products were greater than expected in the previous fiscal year. Nichirei seeks to expand sales this year especially in the meals cooked at home and home-meal replacement markets. Nichirei aims to make processed chicken products the driving force of the growth of processed foods.2. GFPT Nichirei, a subsidiary in Thailand, has achieved its target of processing 100,000 chickens per day. The company sells part of its chickens as raw ingredients in Thailand. However, the market price is low, as the company has stepped up production in anticipation of the lifting of the ban on sales in Europe. It is expected to take time for sales of chicken to improve.3. GFPT Nichirei will urgently seek to find customers in Europe, to improve productivity in the processing line, and to develop chicken- breast-meat products so that it can increase sales of processed products and minimize the effect of sales of chicken in Thailand. The company will accelerate the production of processed products by adding production lines in FY14/3. 5
  • 9. Processed Foods Progress of Our Overseas Sales Strategy EuropeGFPT Nichirei(sale of chicken and processed chicken productsin Europe and Thailand)Expanding sales of processed chicken products(cooked) using chicken breast meat in EuropeNichirei do Brazil Agricola (production ofacerola juice)Preparing to provide acerola raw materials in arange of forms. Will seek to expand the markets toinclude worked materials and antioxidants by China USAoffering powder in addition to the existing Rijuenhai Corporation Shanghai Ltd. (planning and sale of The United States is theconcentrated juice. frozen foods) world’s largest frozen food Has an unofficial order for frozen foods for commercial use market. from a major fast food restaurant chain of China. Following this, We are investigating the deli the company will seek to expand its product line. While market. Vietnam expanding sales, it is looking at bolstering its production system. We are considering enteringCholimex Foods (production of seasoning and the market using Nichireifrozen foods) Taian Jiayu Foods Tuff Company Limited (production of Foods’ ability to developWe took a 19% stake in a major local company frozen vegetables) products and make proposals.producing chili sauce, seasoning and frozen foods in Will start operation in earnest in June. Will produce vegetables,March. Looking at launching products that will be including satoimo potatoes, green soybeans, okra, and broccoli.accepted by the market. Will place the priority on production for Japan for the time being and will start production for China within FY13/3.Overseas sales in Processed Foods were ¥8.5 billion in FY12/3. We aim for ¥15.0 billion in five years. 6
  • 10. Marine Products & Meat and Poultry
  • 11. Marine Products & Meat and Poultry Initiatives and Forecasts for FY13/3 Unit: 100 million yen (amounts less than 100 million yen are rounded off, some fractional amounts have been adjus ted) FY12/3 FY13/3 Full year Q2 (Cumulative) Total (Q3 and Q4) Full year Change from p revious Change from Change from Change from FY11/3 Change from FY12/3 forecast FY12/3 Q1-Q2 FY12/3 Q3-Q4 Actual Previous Forecast Forecast Forecast Amount Ratio Change Amount Ratio Amount Ratio Amount Ratio forecast Marine Net Sales 657 -12 -2% 655 2 336 9 3% 354 24 7% 690 33 5% Products Op erating Income 2 -4 -62% 6 -4 3 -1 -26% 4 6 - 7 5 214% Meat and Net Sales 756 -27 -3% 735 21 390 14 4% 390 10 3% 780 24 3% Poultry Op erating Income 5 1 35% 6 -1 4 1 23% 4 2 101% 8 3 52%1. Marine Products Business (1) Operating income declined ¥0.4 billion in the previous fiscal year, reflecting the shortage of shrimp and changing prices of shellfish in the local producing areas. (2) We expect that the market will stabilize and the supply of shrimp will recover. We are aiming to expand operating income ¥0.5 billion by increasing profitability. (3) We will increase profitability and build a structure that will be less susceptible to market conditions through three initiatives: increasing the added value and distinctiveness of our products, including premium quality ingredients, expanding the market, especially the market of processed products, and reducing inventory.2. Meat and Poultry Business (1) Net sales declined in the previous fiscal year, affected by falls in market prices in association with large quantities of imported chicken. However, operating income rose ¥0.1 billion, reflecting the absence of the effects of scorching heat and the foot-and-mouse disease in the first half of FY11/3. (2) We expect that operating income will rise ¥0.3 billion in FY13/3, attributable to an improvement in profitability associated with the normalization of the balance between the supply and demand of imported chicken and the enhancement of the appeal of products, including premium quality ingredients. (3) In the business involving “Jun Wakei” (pure Japanese chicken), a leading premium quality ingredient, we will establish a company that will operate a chicken farm and a processing plant in Karumaimachi, Iwate and will expand the production base starting FY14/3. 7
  • 12. Logistics
  • 13. Logistics Initiatives and Forecasts for FY13/3 Unit: 100 million yen (amounts less than 100 million yen are rounded off, some fractional amounts have been adjusted) FY12/3 FY13/3 Full year Q2 (Cumulative) Total (Q3 and Q4) Full year Change from p revious Change from Change from Change from FY11/3 Change from FY12/3 forecast FY12/3 Q1-Q2 FY12/3 Q3-Q4 Actual Forecast Forecast Forecast Previous Amount Ratio Change Amount Ratio Amount Ratio Amount Ratio forecast Total Net Sales 1,495 101 7% 1,500 -5 766 18 2% 770 23 3% 1,536 41 3% Logistics Network 833 64 8% 828 5 434 21 5% 432 12 3% 866 33 4% Regional Storage 459 22 5% 461 -2 236 3 1% 229 3 1% 465 6 1% Overseas 188 24 15% 191 -3 93 -2 -2% 96 3 3% 189 1 0% Logistics Other/Intersegment 15 -9 -38% 20 -5 3 -4 -54% 13 5 60% 16 1 9% Total Operating Income 74 1 1% 73 1 36 -1 -1% 40 3 7% 76 2 3% Logistics Network 29 3 12% 28 1 15 2 17% 16 -1 -3% 31 2 6% Regional Storage 41 -2 -4% 42 -1 22 0 2% 22 2 13% 44 3 7% Overseas 9 2 33% 10 -1 5 -1 -15% 4 1 17% 9 -0 -3% Other/Intersegment -5 -3 - -7 1 -6 -2 - -2 0 - -8 -2 -FY12/3 Results FY13/3 ForecastsOverall Overall Sales rose in all businesses and increased a significant 7% year on year overall. We expect that sales will rise 3%, and operating income will increase ¥0.2 Operating income rose ¥0.1 billion with a decline in the regional storage billion. business due to a large amount of depreciation expense offset by a strong 1. Logistics Network performance in the logistics network and overseas businesses. We forecast that sales will climb 4%, and operating income will rise ¥0.21. Logistics Network billion, reflecting the continued contribution of the establishment of new Sales climbed a substantial 8%, and operating income increased ¥0.3 billion. transfer centers. The positive impact of new TC (transfer centers) contributed to sales and 2. Regional Storage earnings. The adverse effect of the earthquake, ¥0.2 billion, on income was Sales are expected to increase 1%. Operating income is forecast to rise ¥0.3 offset. billion, attributable to the establishment of new facilities and a reduction in2. Regional Storage depreciation expense. Sales rose 5%, and operating income declined ¥0.2 billion. Sales increased 3. Overseas partly because of the establishment of new bases. The decline in income was Sales and operating income are set to remain unchanged from the previous chiefly attributable to the effect of depreciation expenses. fiscal year. Both sales and operating income will continue to rise in local3. Overseas currency terms, although the results will be influenced by exchange rates. Sales increased a substantial 15%; operating income rose ¥0.2 billion. This 4. Other/Intersegment reflected the acquisition of Godfroy in the previous fiscal year, the strong Operating income is forecast to decline ¥0.2 billion, primarily reflecting performance in pre-existing operations, and the weak euro. increases in expenses, especially systems-related expenses. 8
  • 14. Logistics Logistics Network TC to Expand Steadily, Freight Forwarding Function to Be Enhanced in Transport Business 1. The number of TC (Transfer Center) contracts has exceeded our forecast in the medium-term business plan. We will seek to expand earnings sources with the addition of new centers, the expansion of temperature zones, including room temperature, handled at existing centers, and contracts for logistics for sourcing. 2. In its transport business, Nichirei will expand the delivery service areas of existing customers and will find new customers in the joint delivery of frozen foods and ice cream. Meanwhile, Nichirei will expand the delivery of goods from producing areas, especially Hokkaido and Kyushu, in collaboration with regional storage companies. 3. In third party logistics, Nichirei will aim at stable operation for a major restaurant chain with which it made a contract in the previous fiscal year and will seek to find new customers.(Number of locations) 35 Changes in the number of TC (Transfer Center) locations Recent TC contracts Numbers expected at beginning of FY11/3  (24) (26) (27)30 Start of operation Business name Business category Temperature Oct. 2009 Fukuzaki (Osaka) Grocery store Chilled Dec. 2009 Iwaki (Fukushima) Grocery store Chilled25 At room Oct. 2010 Saga (Saga) Drug store temperature Nov. 2010 Koshigaya Seika (Saitama) General merchandise store Chilled20 Jan. 2011 Hayashima (Okayama) Grocery store Chilled At room 32 Jul. 2011 Hirokawa (Fukuoka) Drug store15 30 temperature 28 Jan. 2012 Hachinohe (Aomori) Grocery store Chilled 24 24 25 25 23 Feb. 2012 Aomori (Aomori) Grocery store Chilled10 21 19 Jun. 2012 (plan) Tosu (Saga) Drug store Chilled 14 Oct. 2012 (plan) Yamagata Sagae (Yamagata) Grocery store Chilled 11 12 FY14/3 Two contracts planned 5 8 0 01/3 02/3 03/3 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E 14/3P (Note) Some locations were closed in 10/3 and 11/3. 9
  • 15. Logistics Local StorageBolstering Operating Base Through Investments inHigashi-Ogishima DC No. 2 Building and in Kansai Area1. Demand for Higashi-Ogishima DC remains strong, and the storage is almost full. Nichirei is striving to increase income by expanding ancillary services and streamlining cargo loading and unloading tasks.2. Nichirei will promote cargo booking in anticipation of an increase in capacity associated with the commencement of the operation of the No. 2 building in the summer of 2013. Meanwhile, it will seek to optimize the distribution of cargo in accordance with the features of warehouses in the harbor district of the Tokyo area.3. Nichirei is receiving many inquiries in the Kansai area and is considering locations appropriate for logistics. Nichirei Logistics Group network, including Higashi- Higashi-Ogishima DC (No. 1 and No. 2 buildings) Ogishima DC, in the harbor district of the Tokyo area Completion image of No. 2 building (to be completed in July 2013) Shinagawa DC Start of operation: 1987 Capacity: 17,000 tons No. 2 building Tokyo DC Oi DC Start of operation: 1997 Start of operation: 1987 Capacity: 35,000 tons Capacity: 51,000 tons Keihin Futo DC Start of operation: 1971 Capacity: 23,000 tons Bay area of Tokyo total capacity: 127,000 tons Tokyo and Kawasaki area total capacity: 207,000 tons Higashi-Ogishima DC Start of operation: 2011 No. 2 building to start to operate in July 2013 Capacity: 40,000 tons  81,000 tons Total floor area: 71,115 m² Total refrigerating capacity: 80,894 t (highest level in the Group) Facilities of Nichirei Logistics Kanto Major facilities: Facilities of Logistics Network All rooms to handle goods kept at low temperatures, 62 berths for loading and unloading, 15 dock levelers, 15 pallet lifters, 5 Authorization NO.54G014 elevators 10
  • 16. Logistics Overseas Operations in Europe Solid, Expanding the Operating Base in China with the Establishment of Second Center 1. Operations in Europe were solid, offsetting the effect of the debt crisis. Both sales and income are expected to rise from a year ago in local currency terms, although there will be a currency translation effect from the weak euro. (The euro was 111 yen in FY12/3 and is expected to be 106 yen in FY13/3.) 2. Nichirei is aiming to expand its earnings sources in Western Europe and Eastern Europe through synergy among Group companies and through the enhancement of facilities in association with the acquisition of new customers in France and Poland. 3. The Second Shanghai Center started operation in April 2012. Nichirei is aiming to respond to strong demand for storage and transport by expanding storage capacity. It will also cater to the demand by improving delivery efficiency in the Shanghai area and expanding the distribution area to East China, increasing the number of its own vehicles. Results in euro Development of Transport in Shanghai Net Sales Operating Income Expansion of trunk line transport Second Shanghai Center (Million euro) (Million euro)200 14180 12160140 10120 8100 Name: Shanghai Fresh Line 6 Express Co., Ltd. (Second80 Center)60 4 Location: 8 Hao, 3509 Nong, Hongmei Nanlu, Minhang-qu,40 Shanghai (next to the First 2 Center)20 Capacity: 3,900 tons 0 0 * The capacity of the First 08/3 09/3 10/3 11/3 12/3 13/3E Center (1,300 tons) and the Second Center combined is Net Sales Operating Income 5,200 tons. 11
  • 17. Reference Materials
  • 18. Factors Influencing Changes in Consolidated Balance Sheet for FY12/3Unit: 100 million yen (amounts less than 100 million yen are omitted) Item 12/3 11/3 Change Main Factors (Amount) (i) Accounts receivable increased ¥7.9 billion,[Assets] reflecting a sharp rise in sales in Processed Foods and Logistics, core businesses, and theCurrent assets 1,154 1,031 123 (i) effect of the end of the fiscal year falling on aFixed assets 1,750 1,813 -63 (ii) bank holiday. Inventories climbed ¥5.5 billion, mainly attributable to an increase in inventoryTotal assets 2,905 2,845 59 in preparation for sales expansion.[Liabilities/ Shareholders’ equity]Current liabilities 841 1,103 -261 (iii) (ii) Tangible fixed assets declined by ¥5.3 billion as depreciation progressed on last term’sFixed liabilities 876 564 311 (iii) capital investments.Total liabilities 1,718 1,668 50Net assets (iii) The funding policy was changed in light of 1,187 1,177 9 recent changes in the financial environment.(Shareholders’ equity) 1,165 1,150 15 The Company has completed long-term, fixed rate financing (bonds, long-term loans payable)Interest-bearing debt 978 969 8 to mitigate interest rate risks.(Excluding lease obligations) 748 724 23 Change (iv) Main capital investments Item 12/3 11/3 Logistics (Amount)Capital investment Higashi-Ogishima DC No. 2 Building 116 210 -94 (iv) Kagoshima So-o DC, Aomori TC(Excluding lease assets) 89 172 -82Depreciation and amortization 149 141 8(Excluding lease assets) 111 104 7 12
  • 19. Factors Influencing Changes in Non-Operating Revenues/Expenses and Extraordinary Income/Losses for FY12/3 Full YearUnit: 100 million yen Change from(amounts less than 100 million yen are omitted) Change from Previous PreviousPositive numbers indicate profits 12/3 11/3 Estimate FY11/3 Estimate (Amount) (Amount)[Non-Operating Revenues/Expenses] -9 -5 -11 -3 +1(Main Item)Dividend income and interest expenses, net -8 -8 -10 +0 +1[Extraordinary Income/Loss] -10 -72 -7 +62 -3(Main Item)Gain on sales of investment securities +1 +8 +1 -6 +0Compensation income (i) - +30 - -30 -Loss on disaster (ii) -3 -31 -3 +28 -0Loss on devaluation of investment securities (iii) -6 -0 -6 - -0Loss on revision of retirement benefit plan (iv) - -66 - +66 -Loss on adjustment for changes of accountingstandard for asset retirement obligations (v) - -7 - +7 - Note: Previous Estimate denotes forecasts announced on February 7, 2012.(i) Extraordinary profit from gain on establishment of superficies(ii) Extraordinary loss as a result of the impacts of the Great East Japan Earthquake(iii) Extraordinary loss associated with declines in stock prices(iv) Extraordinary losses increased with losses on adjustment for changes in the accounting standard for asset retirement obligations.(v) Extraordinary loss associated with the application of the revised accounting standard for asset retirement obligations 13
  • 20. Net Sales by Segment Operating Income by Segment 100 million yen 100 million yen5,500 200 4,745 4,549 4,740 66 4,378 61 4,381 60 50 168 173 74 69 62 49 175 167 66 4 162 34,500 151 6 4 0 21 70 Adjustment 5 1,423 1,536 150 4 36 24 1,495 2 37 1,390 1,394 Other3,500 125 40 Real Estate 925 76 780 776 783 756 100 Logistics 742,500 73 761 690 Meat and Poultry 79 672 657 75 668 Products 8 82 71,500 Marine Products 4 5 50 2 6 7 1,740 1,742 1,850 Processed Foods 9 1,621 1,619 60 25 0 46 52 500 3 20 26 -244 -217 -214 -210 -227 0 -2 -2 Fiscal year Fiscal year -500 09/3 10/3 11/3 12/3 13/3E 09/3 10/3 11/3 12/3 13/3E -25 Historical Net Sales for Frozen Foods 100 million yen Net Sales and Operating Income of Processed Foods 100 million yen (Based on definitions from the Japan Frozen Food Association, includes processed foods as well as marine products, meat and poultry products)2,000 100 million yen 1,848 1,850 90 2,000 1,785 1,773 1,750 1,740 1,742 1,831 1,700 1,726 1,621 1,619 1,698 366 416 344 326 306 3601,500 495 70 499 487 128 304 320 1,500 460 475 122 104 61 119 50 60 79 48 52 60 48 55 552 46 50 556 466 461 534 5041,000 464 521 1,000 534 43 41 480 811 774 771 30 20 26 500 500 798 803 839 869 811 839 738 774 771 10 679 464 480 521 0 -10 0 Fiscal year 10/3 11/3 12/3 Fiscal year 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E Pre-coocked frozen foods Pre-coocked frozen foods Pre-Cooked Frozen Foods for Household Use Pre-Cooked Frozen Foods for Commercial Use Health value Other Operating income for commercial use for househould use Other than Pre-Cooked Frozen Foods 14
  • 21. Sales of Logistics Operating Income in Logistics 100 million yen 100 million yen 120 180 1,536 163 165 168 1,495 1581,500 157 1,423 1,390 1,394 1,387 189 1,341 188 100 1,271 224 165 164 224 140 178 85 1,139 1,167 82 156 79 80 16 74 76 9 133 17 7 73 137 7 9 72 71,000 6 20 100 866 60 17 22 19 31 833 58 26 722 753 769 12 29 688 709 13 632 51 486 554 12 40 9 36 60 1 500 53 50 53 47 49 43 41 44 20 38 31 501 20 461 463 454 442 462 452 437 459 465 0 -4 -5 -8 -5 -2 -1 -5 -8 -11 -3 Fiscal year 0 Fiscal year 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E -20 -20 Regional Storage Logistics Network Overseas Others/common business Regional Storage Logistics Network Overseas Others/common business Operating income EBITDA Sales/Operating Income of Marine Products/Meat and Poultry Business100 million yen Sales in Logistics Network by Division Operating income: 100 million yen Net sales: 100 million yen 30 1,000 1,000 910 925 900 846 900 866 847 839 833 809 776 783 780 20 759 761 756 800 800 753 769 151 811 709 722 141 672 668 690 688 747 747 657 700 632 146 134 142 121 9 140 10 8 8 600 600 6 6 7 7 138 300 6 5 298 4 4 500 3 3 286 290 2 277 299 400 269 0 400 -0 261 -4 300 -5 200 394 415 -10 200 302 321 345 -10 279 290 233 -14 100 -17 0 -20 Fiscal year 0 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3E Fiscal year TC Transport Others Marine Products: operating income Meat and Poultry: operating income Marine Products: sales Meat and Poultry: sales 15
  • 22. Cold Storage Capacity Utilization (Industry data adapted by Nichirei from Japan Association of Refrigerated Warehouses documents) General storage, Average intake volume 1,000 ton Industry-Wide Cold Storage Capacity Utilization utilization rate General storage, Nichirei Group Cold Storage Capacity Utilization Average intake volume 1,000 ton utilization rate14,000 40.0% 2,000 55.0% Volume 1,80012,000 38.0% warehoused in Japans 12 51.5% cities 1,600 50.0% Tokyo 35.6% 35.9% Metropolitan10,000 36.0% Area 1,400 Kansai Area 34.7% 1,789 Nagoya 1,200 45.0% 8,000 33.3% 33.4% 33.8% 34.0% Fukuoka 42.0% 1,615 32.2% Volume 1,000 32.9% 11,961 warehoused 41.1% 6,000 11,387 32.0% in Japans 12 41.5% cities 39.7% 40.1% 10,657 31.7% 800 1,495 40.0% 30.8% 30.9% Tokyo 39.5% 39.0% Metropolitan 38.1% Area 37.1% 37.9% 4,000 30.0% 30.0% 600 29.9% Kansai Area 36.3% 28.5% 36.0% Nagoya 400 824 35.0% 5,179 35.3% 5,531 651 691 2,000 3,024 3,141 28.0% 4,895 2,814 Fukuoka 529 200 484 501 27.6% 30.8% 965 857 1,063 975 1,134 1,024 98 102 120 76 62 94 0 Fiscal year 26.0% 0 30.0% Fiscal year 10/3 11/3 12/3 10/3 11/3 12/3 Top 20 Domestic Companies in Cold Storage Capacity (Created by Nichirei based on Japan Association of Refrigerated Warehouses documents) (As of January 1, 2012) Number Capacity Change compared Ranking Name of Company/Group of base 10 thousand tons to 11/1 Major region 1 Nichirei Group 80 138 4 Nationwide 2 Yokohama Reito 39 73 2 Nationwide 3 Maruha-Nichiro Group 37 58 0 Nationwide 4 Nippon Suisan Group 21 37 0 Nationwide 5 Toyo Suisan Group 18 36 0 Nationwide 6 Hutech norin 14 24 1 Nationwide 7 Igarashi Reizo 11 22 0 Kanto 8 Futaba 8 17 0 Kanto 9 HYOSHOKU 10 17 0 Kansai 10 Konoike Transport 13 17 2 Nationwide 11 Matsuoka 6 16 0 Kanto, Kansai, Kyushu 12 K.R.S.Corporation 23 14 0 Nationwide 13 Hosen Cold Storage 4 14 0 Kansai 14 HOHSUI 10 12 1 Kanto 15 Kowan Reizo 6 10 1 Kanto, Kansai, Kyushu 16 Yamate Reizo 5 10 0 Kanto 17 Tokyo Toyomi Reizo 3 7 0 Kanto 18 Mitsubishi Logistics Corporation 6 7 0 Kanto 19 Tsujino 6 7 0 Kanto, Tohoku, Kyushu 20 Ajinomoto Logistics Corporation 6 7 0 Nationwide (Note) Since there are no data available for Iwate and Miyagi prefectures due to the earthquake, the national total is omitted. 16
  • 23. Forward-Looking StatementsAside from historical facts, Nichireis present plans, forecasts and strategies as outlined in this publication consistof forward-looking statements about future business performance. These forecasts of future business performanceand explanations of future business activities may or may not include words such as "believe," "expect," "plan,""strategy," "estimate," "anticipate" or other similar expressions. These statements are based on the informationavailable to Nichirei management at the time of publication. Actual results may differ significantly from theseforecasts for a variety of reasons, and readers are therefore advised to refrain from making investment decisionsbased solely on these forward-looking statements. Nichirei will not necessarily revise its forward-lookingstatements in accordance with new information, future events, and other results. Risks and uncertainties thatcould affect Nichireis actual business results include, but are not limited to:(1) Changes in the economic conditions and business environment that may affect the Nichirei Groups business activities.(2) Foreign exchange rate risks, especially as regards the US dollar and the euro.(3) Risks associated with the practicability of maintaining quality controls throughout the process from product development, procurement of raw materials, production, and sale.(4) Risks associated with the practicability of development of new products and services.(5) Risks associated with the practicability of growth strategies and implementation of low-cost systems.(6) Risks associated with the practicability of achieving benefits through alliances with outside companies.(7) Contingency risks.However, factors that may affect the performance of the Nichirei Group are not limited to those listed above.Further, risks and uncertainties include the possibility of future events that may have a serious and unpredictableimpact on the Group. This publication is provided for the sole purpose of enhancing the readers understanding ofthe Nichirei Group, and should not be taken as a recommendation regarding investment decisions.