Announcement of the Settlement of Accounts for the Second Quarter of the Year Ending March 2015

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

Our settlement of accounts for the second quarter of the year ending March 2015 was announced on the afternoon of Friday, November 7 at the Tokyo Stock Exchange Press Clubs. An outline of the accounts is presented below.

Consolidated Results for the Second Quarter of the Year Ending March 2015 (April 1, 2014 to September 30, 2014)

Overview of the second quarter of the year ending March 2015

The Japanese economy during the company's first half of the fiscal year saw continuous improvements in corporate earnings and increased stock prices due to government fiscal and economic policies, but a slowdown in the economic recovery was also observed due to continuing trade deficit and a reaction to the last-minute demand accompanying the increase in consumption tax. However, while a recovery in the economy of the United States was seen and the dollar rapidly gained value in the second half of the period, the future of the economic situation overseas remained uncertain with slowing growth in developing countries and conflicts in certain areas among other factors.

The domestic food industry in which our group is placed continued to face adverse business conditions as a result of a continuing rise in raw material prices following the depreciating yen.

Amid such environment, we created a new middle term business plan called “Renaissance Fuji 2016”, engaging in product development fitting the needs of customers, delivering high-functionality ingredients and reducing production costs upon positioning “promotion / acceleration of global management”, “promotion / acceleration of technological management” and “promotion / acceleration of sustainable management” as our fundamental policies.

As a result, for the first half of the year ending March 2015, we achieved net sales of 128,115 million yen (increase of 8.0% y-o-y), operating income of 6,421 million yen (decrease of 0.2% y-o-y), ordinary income of 6,403 million yen (increase of 0.5% y-o-y) and net income of 4,684 million yen (increase of 20.3% y-o-y).

Overviews by division are as follows:
The operations division that is included as a report division has been changed since the first quarter period, and the comparisons and analysis for the first half period are based on the division after the change.

<Oils and Fats Processing Division>
Domestically, sales for blended oils centering on industrial use 18-liter square cans decreased, but increased sales and profit was achieved due to increased sales volume and sales prices of coconut oil, palm oil and hard butters for chocolate.

Overseas, the sales volume of hard butters for chocolate in the United States, Southeast Asia and China increased, and sales and profits increased due to factors including an overall increase in sales prices and favorable yen conversion rates due to the weakened yen.

Through these results, this division achieved a sales volume of 49,559 million yen (increase of 10.6% y-o-y) and an operating income of 2,679 million yen (increase of 75.9% y-o-y).

<Confectionery and Baking Ingredients Division>
Domestically, sweet chocolates, ice-coating chocolates, and molded chocolates posted gains in sales volume, resulting in increased sales for chocolates. Sales of cream and margarine increased and sales of prepared products decreased, but net sales overall for the Confectionery and Baking Ingredients Division increased. In terms of profitability, profits decreased as a result of an overall increase in the price of raw materials.

Overseas, sales increased in Southeast Asia for chocolate, cream, margarine, and shortening, and in China for margarine, shortening, and fillings, which resulted in an overall increase in sales and profit.

Through these results, this division achieved a sales volume of 59,105 million yen (8.4% y-o-y increase) and an operating income of 3,466 million yen (18.9% y-o-y decrease).

<Soy Protein Division>
Soy protein ingredients decreased sales volume for meat, health foods, prepared foods, processed foods, fermentation and culture medium, and in the fishery market, but sales in China increased, leading to an increase in sales overall. Functional food ingredients improved in sales following increase in sales for exports and products for beverages. Soy protein products saw higher sales in instant noodles but a decrease in revenue overall as retail foods accumulated lower sales. Sales of soy milk increased due to the sale of new products. The overall sales increased but were impacted by struggling profitability of soy protein ingredients due to the high price of raw materials, and thus resulted in significantly lower profit.

Through these results, this division achieved a sales volume of 19,450 million yen (0.8% y-o-y increase) and an operating income of 275 million yen (56.7% y-o-y decrease).

Predictions for Consolidated Results for the Year Ending March 2015 (April 1, 2014 to March 31, 2015)

*Qualitative information regarding forecast consolidated figures
No revisions have been made for the full-year forecast announced on May 9, 2014. 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