News Release

2009.8.6Announcement of the Settlement of Accounts for the First Quarter of the Year Ending March 2010

(Note) Figures shown have been rounded down to the nearest million yen

Our settlement of accounts for first quarter of the year ending March 2010 was announced on the afternoon of Thursday, August 6 at the Tokyo Stock Exchange and Osaka Securities Exchange Press Clubs. An outline of the accounts is presented below.

Consolidated Results for the First Quarter of the Year Ending March 2010
(April 1, 2009 to June 30, 2009)

Consolidated operating results (total)

(% is in comparison to the previous year)

  Net sales Operating income Ordinary income Net income
(millions of yen) (%) (millions of yen) (%) (millions of yen) (%) (millions of yen) (%)
First quarter of the
year ending March 2010
49,920 (12.4) 3,564 40.6 3,363 34.3 2,153 15.8
First quarter of the
year ending March 2009
56,978 2,534 2,505 1,859

Overview of the first quarter for FY ending March 2010

Although the Japanese economy during the first quarter period may have reached its bottom in some parts following the inventory adjustments and end of decrease in export volume, the environments surrounding employment and income have become more challenging.

The food industry in which our group is placed was faced with more intensified cost pressures from consumers, which in turn accelerated the lower pricing trend.

Amid such environment, we took such environmental changes as an opportunity for growth, and have continued to promote "technology management" while steadily carrying out measures from the medium-term business plan "Innovation and Action 2010", which marked its 2nd year since execution. We continued our efforts in expanding the sales of functional material, executing cost reduction measures, and making price revisions that comply with raw material prices.

As a result, for the first quarter of the year ending March 2010, we achieved net sales of 49,920 million yen (12.4% y-o-y decrease), operating income of 3,564 million yen (40.6% y-o-y increase), ordinary income of 3,363 million yen (34.3% y-o-y increase) and net income of 2,153 million yen (15.8% y-o-y increase).

Overviews by division are as follows.

[Breakdown of Results by Division]
<Oils and Fats Processing Division>
Domestically, the steady sales of specialty products was not enough to offset the decline in sales price of fats for frying and other general oils and fats, following decline in raw material prices and intensified competition, and resulted in year-on-year decreases for both sales and profit.

Overseas, although there were some negative effects observed in the US and Europe due to the economic recession, the Asian region achieved solid results and contributed to increase in profits despite the decrease in sales following the drop in raw material prices.

Through these results, this division achieved a sales volume of 19,223 million yen (a decrease of 25.5% y-o-y) and an operating income of 1,499 million yen (a decrease of 12.0% y-o-y).

<Confectionery and Baking Ingredients Division>
Domestically, chocolates for industrial use such as the chocolate for ice cream posted steady growth. Creams, margarines, shortenings and fillings gained profits following the excellent results of products that are differentiated from others in flavor, deterioration-resistant function and other advantageous features. Imported confectionary and baking ingredients experienced decrease in sales following the drop in sales price due to declining raw material prices, but nonetheless achieved gains in profit.

Sales of dessert products from our domestic group company struggled in part due to swine flu fears, and the category consequently posted decline in both sales and profit.

Our overseas subsidiaries in the division posted decrease in sales due to impact from the market price of raw materials, but nevertheless achieved increase in profits following enhanced profitability.

Through these results, this division achieved a sales volume of 21,303 million yen (a decrease of 2.6% y-o-y) and an operating income of 1,621 million yen (61.3% increase y-o-y).

<Soy Protein Division>
Domestically, soy protein ingredients were impacted from raw material costs and saw decline in profits despite the steady sales recorded from products for prepared food, frozen foods, and the fermentation and culture medium markets. Overseas, our group company in China increased profits in addition to sales as a result of its improved product profitability.

Soy protein products experienced decrease in sales following the ongoing efforts taken in narrowing down the product mix, but improved in profits as a result of enhanced profitability.

Soy peptides recorded increases in both year-on-year net sales and profits due to steady growth posted by products for fermentation and culture medium in addition to favorable results achieved by exports.

Water-soluble soy polysaccharides posted significant gains in both sales and profits as a result of solid sales from acid lactic beverages domestically, in addition to expanding business to the rice-related products market.

Soy milk saw decline in sales but improved in profits thanks to cost-reduction efforts.

Mail orders recorded decline in sales but significantly increased profits following the favorable "Isofla-Balance" results and cost reduction efforts.

Through these results, this division achieved a sales volume of 9,393 million yen (1.1% increase y-o-y) and an operating income of 444 million yen (an operating loss of 174 million yen was recorded in the previous year).

Predictions for Consolidated Results for the Year Ending March 2010
(April 1, 2009 to March 31, 2010)

(% is in comparison to the previous year)

  Net sales Operating income Ordinary income Net income
for the term
Net income
per share
(yen)
(millions of yen) (%) (millions of yen) (%) (millions of yen) (%) (millions of yen) (%)
First 2 Quarters 105,800 (8.9) 4,900 0.7 4,200 (6.2) 2,700 (10.0) 31.41
Full Year 223,400 (6.7) 12,000 4.1 10,700 3.8 6,600 (11.8) 76.78

(Note) No revisions for forecast consolidated figures were made this quarter

*Qualitative information regarding forecast consolidated figures
No revisions have been made for the forecast announced on May 8, 2009 of the first 2 quarters as well as of the year. Revisions will promptly be announced if deemed necessary after determining the changes that may arise in the Company's business environment.

*Explanation and other notes regarding appropriate utilization of the predictions
The forecasts above have been made based on assumptions deemed rational together with information available at the time of this announcement, and the actual results may differ from these forecasts due to various factors.

End of report

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