Ajinomoto Co., Inc. · TSE:2802
Ajinomoto — FY2020 Earnings Presentation
55 slides from Ajinomoto's earnings presentation, May 10, 2021
Slide 1: Forecast for FY2021 and Initiatives to Enhance Corporate Value
Ajinomoto Co., Inc. (2802) Forecast for FY2021 (Ending March 31, 2022) and Initiatives to Enhance Corporate Value Takaaki Nishii President & CEO May 10, 2021
Slide 2: Contents
Contents I. FY2020 Summary Results and FY2021 Forecast II. FY2021 Initiatives to Enhance Corporate Value III. Initiatives to Grow Our Businesses Reference Material Appendixes: Consolidated Results FY2020 (Ended March 31, 2021) FY2021 Forecast by Segment Note: Business profit (consolidated) in this m
Slide 3: Contents
Contents I. FY2020 Summary Results and FY2021 Forecast II. FY2021 Initiatives to Enhance Corporate Value III. Initiatives to Grow Our Businesses Reference Material Appendixes: Consolidated Results FY2020 (Ended March 31, 2021) FY2021 Forecast by Segment Note: Business profit (consolidated) in this m
Slide 4: FY2020: Summary Results
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-1. FY2020: Summary Results Sales decreased due to Seasonings and Foods, and Frozen Foods which were impacted by the COVID-19 pandemic. Business profit increased, due to effects of increased revenue
Slide 5: FY2020: Q4 Results Summary
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-2. FY2020: Q4 Results Summary FY2020 Q4 (January–March) Results Summary (YoY) Sales: ¥276.5 billion (down 0.4%, excluding currency translation: up 0.4％) Business profit: ¥13.1 billion (down 17.1%,
Slide 6: FY2020: Changes in Business Profit (YoY)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-3. FY2020: Changes in Business Profit (YoY) FY2020 ended with a ¥13.8 billion increase in profit due to, increasing the GP margin and GP along with growth of sales of home-use products and decrease
Slide 7: FY2020: Sales and Business Profit by Segment
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-4. FY2020: Sales and Business Profit by Segment Sales of Seasonings and Foods, and Frozen Foods decreased over the year under the impact of the COVID-19 pandemic. Sales of Healthcare and Others inc
Slide 8: FY2020: Sales and Business Profit by Region
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-5. FY2020: Sales and Business Profit by Region Sales decreased in Seasonings and Foods in all regions under the impact of the COVID-19 pandemic. Sales increased in Healthcare and Others in all regi
Slide 9: FY2021: Items that Impact Business Results
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-6. FY2021: Items that Impact Business Results Impacts on FY2021 business results (macro scenario) At the present, it cannot be predicted when the COVID-19 outbreak will come to an end, so the econo
Slide 10: FY2021: Forecast
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-7. FY2021: Forecast Sales will increase due to increases in Seasonings and Foods, and Frozen Foods, despite a decrease in Healthcare and Others. Business profit will increase due to the effect of i
Slide 11: FY2021: Changes in Business Profit (YoY)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-8. FY2021: Changes in Business Profit (YoY) (¥ billion) Cost increases for raw materials and fuel, and food ingredients: -¥1.8 billion Currency translation including -¥0.2 billion 150 140 130 7.6 A
Slide 12: FY2021: Sales and Business Profit by Segment
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-9. FY2021: Sales and Business Profit by Segment Sales will increase due to increased revenue primarily from overseas products in Seasonings and Foods, and Frozen Foods, despite decreased revenue in
Slide 13: FY2021: Sales by Region
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-10. FY2021: Sales by Region Increased revenue in all regions for Seasonings and Foods. Increased revenue in all regions for Frozen Foods, except Japan, where unprofitable items will be eliminated.
Slide 14: FY2021: Important Management Indicators
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-11. FY2021: Important Management Indicators In FY2020, both business profit and operating profit increased so the important management indicators improved significantly. They are expected to improv
Slide 15: Investment for Growth and Shareholder Returns (FY2020–2022)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-12. FY2021: Investment for Growth and Shareholder Returns (Approach for FY2020–2022) Throughout the Medium-Term Management Plan (MTP) shift investment from tangible to intangible assets, from non-c
Slide 16: Investment for Growth and Shareholder Returns (FY2021 forecast)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses I-12. FY2021: Investment for Growth and Shareholder Returns (FY2021 forecast) Prioritize investment in intangibles and core businesses in FY2021, too. Enhance shareholder returns. Intangible investme
Slide 17: Contents
Contents I. FY2020 Summary Results and FY2021 Forecast II. FY2021 Initiatives to Enhance Corporate Value III. Initiatives to Grow Our Businesses Reference Material Appendixes: Consolidated Results FY2020 (Ended March 31, 2021) FY2021 Forecast by Segment Note: Business profit (consolidated) in this m
Slide 18: ASV Management
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-1. ASV Management (Repeat of IR DAY slide) ASV Management Pursuit of intrinsic social and corporate value … unlocking the power of amino acids to resolve food and health issues … “Global Top 10 Cl
Slide 19: FY2020-2025 MTP: Five Transformations
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-1. FY2020-2025 MTP: Five Transformations (Revision of IR Day slide) 1. Renew our corporate vision: Contribute to greater wellness for people worldwide, unlocking the power of amino acids to resolv
Slide 20: The Mechanism of Enhancing Corporate Value
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-1. The Mechanism of Enhancing Corporate Value (Revision of IR-DAY slide) Human resources OE Customers OE Tangible assets Structural reform and establishment of a new growth model with DX (Operatio
Slide 21: FY2020 Risk Management (Acceleration of ASV Management)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-1. FY2020 Risk Management (Acceleration of ASV Management) Flexibly renew the FY2020-2025 MTP in light of COVID-19 impact and DX Progress Backcasting from 2030 Vision and structural targets COVID-
Slide 22: FY2020 Ajinomoto Group Executive Seminar
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-1. FY2020 Ajinomoto Group Executive Seminar Toward the goal of solving food and health issues • The CEO made a declaration about psychological safety • Each person reflected deeply on the past 10
Slide 23: Drive Framework
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-1. Drive Framework (Revision of IR-DAY slide) Transform corporate culture as one team, with the CEO at the center CEO Executive Committee Food Products Division AminoScience Division Corporate Ser
Slide 24: FY2020 Management Review (Acceleration of ASV Management)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-2. FY2020 Management Review (Acceleration of ASV Management) 20–22 23–25 Phase 1 Phase 2 2030 Goal Structural reform Regrowth FY19 FY20 FY22 FY25 (Actual) (Actual) (Target) (Target) Efficiency ROI
Slide 25: FY2020 Management Review: Progress Toward Targets
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-2. FY2020 Management Review (Acceleration of ASV Management) Steady progress toward FY2022 targets despite impairment due to structural reform. ROIC (>Capital cost) ROIC （ >資本コスト） Over the year, n
Slide 26: Progress in Structural Reform
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-3. Progress in Structural Reform Structural reform in non-core businesses Financial impact 1. Animal Nutrition Business (commodities) Amount of asset Complete structural reform. Shift to customer
Slide 27: Progress in Structural Reform: ROIC
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-3. Progress in Structural Reform ROIC expected to temporarily fall below real capability due to impairment accompanying structural reform Approx. 8% Approx. 8% (excludes impairment) (excludes stru
Slide 28: Initiatives for Organic Growth
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-4. Initiatives for Organic Growth Increase touchpoints* to extend healthy life expectancy to 1 billion people. FY20 results up 4.1％ (Image for 10-year CAGR: +3.8％) Solution & Sauce & Seasonings Qu
Slide 29: Entrenchment of home cooking and health consciousness (Japan)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses (Ref.) Entrenchment of home cooking and increase in health consciousness among consumers (Japan) The frequencies of home cooking and of nutrition-conscious dining continue to increase. The number of
Slide 30: Entrenchment of home cooking in major countries (Overseas)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses (Ref.) Entrenchment of home cooking among consumers in major countries, too (Overseas) Opportunities for home cooking are increasing in Thailand and Vietnam, countries considered to have a relatively
Slide 31: Household expenditures and where meals are eaten
100 120 140 160 0 20 40 60 80 100% Jan. 2020 2020年1月 Feb. 2020 2020年2月 Mar. 2020 2020年3月 Apr. 2020 2020年4月 May 2020 2020年5月 Jun. 2020 2020年6月 Jul. 2020 2020年7月 Aug. 2020 2020年8月 Sep. 2020 2020年9月 Oct. 2020 2020年10月 Nov. 2020 2020年11月 FY20 Results 2020年12月 Dec. 2020 2021年1月 Jan. 2021 Overall househol
Slide 32: Initiatives for Organic Growth: Basic Strategies
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-4. Initiatives for Organic Growth Basic strategies aimed at realizing organic growth Capture increases in healthy diet and at-home dining, and the digital channel Priority investment in core brand
Slide 33: Enhancing Brand Value Centered on Nutrition Value
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-5. Enhancing Brand Value Centered on Nutrition Value Copyright © 2021 Ajinomoto Co., Inc. All rights reserved 33
Slide 34: Enhancing Brand Value Centered on Nutrition Value
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-5. Enhancing Brand Value Centered on Nutrition Value Promote “Smart Salt” Expand the health and nutrition ecosystem Contribute to people's salt reduction through global “Smart Salt” marketing Esta
Slide 35: Enhancing Corporate Brand
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-5. Enhancing Corporate Brand (Approximately equal to enhancement of customer value) V-shaped recovery of brand value in recognition of new ASV management strategy and strengthening of user experie
Slide 36: Employee Engagement
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-6. Employee Engagement Improvement in ASV as one’s own initiative to enhance customer value. Response to health and productivity management more favorable in COVID-19 pandemic. In FY2020, the enga
Slide 37: Employee Engagement: Dialogue with CEO
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-6. Employee Engagement Dialogue with CEO Management Cycle to Enhance “ASV as one’s own FY2020 FY2021 initiative” and Personal Capability Development Ajinomoto Expand to domestic and Co., Inc. over
Slide 38: Accelerate the DX n.0 Transformation Step
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-7. Accelerate the DX n.0 Transformation Step (Toward Phase 2) We will accelerate transformation toward Phase 2 (regrowth) by upgrading and streamlining operations through DX. Actual Company-wide ・
Slide 39: Accelerate DX3.0 Business Model Transformation
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-7. Accelerate DX3.0 Business Model Transformation (Toward Phase 2) Create new business model of solving food and health issues We are unearthing our intangible assets,* building an ecosystem, and
Slide 40: The Journey to Sustainability: Extend Healthy Lifespan
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-8. The Journey to Sustainability: Extend Healthy Lifespan Up to 2020 2021 2030 Two priority initiative items Creation of ecosystem Outcome Delicious salt Promote reduction Project Reduced salt “Nu
Slide 41: The Journey to Sustainability: Reduce Environmental Impact by 50%
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-8. The Journey to Sustainability: Reduce Environmental Impact by 50% Up to 2020 2021 2022 2025 2030 ▲SBTi target validation SBTi targets ▲RE100 commitment Accelerate Adopt internal carbon pricing
Slide 42: Accelerate GHG Reduction Measures through Internal Carbon Pricing
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-8. (Ref.) Accelerate GHG Reduction Measures through Use of Internal Carbon Pricing To achieve SBT GHG reduction targets of 30% in 2025 and 50% in 2030 (vs. FY2018), we will use Internal Carbon Pri
Slide 43: FY2021: Priority KPIs (Company-wide forecast)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-9. FY2021: Priority KPIs (Company-wide forecast) 20–22 23–25 Phase 1 Phase 2 2030 Goal Structural reform Regrowth FY19 FY20 FY21 FY22 FY25 (Actual) (Actual) (Target) (MTP Target) (MTP Target) Effi
Slide 44: FY2021: Priority KPIs (Forecast by segment)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses II-9. FY2021: Priority KPIs (Forecast by segment) Segments FY2020 Actual and FY2021 Forecast Organic Unit price growth growth ROIC (％) (％) (％) MTP Targets Sauce & * Seasonings FY20 FY21 FY20 FY21 FY2
Slide 45: Contents
Contents I. FY2020 Summary Results and FY2021 Forecast II. FY2021 Initiatives to Enhance Corporate Value III. Initiatives to Grow Our Businesses Reference Material Appendixes: Consolidated Results FY2020 (Ended March 31, 2021) FY2021 Forecast by Segment Note: Business profit (consolidated) in this m
Slide 46: Seasonings and Foods (2020 initiatives)
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses III-1. Seasonings and Foods (Organic growth supporting the entire company) Focus on core products and give top priority to supplying stably. Strengthen business structure and promote initiatives capt
Slide 47: Key strategies for FY2021 in Seasonings and Foods
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses III-1. Seasonings and Foods (Organic growth supporting the entire company) Further strengthen business structure to achieve FY2025 ROIC targets of 10-11%. Advance sustainable organic growth and great
Slide 48: Frozen Foods: FY2020 initiatives
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses III-2. Frozen Foods (Initiatives for ROIC of 5% in FY2025) In FY2020, we moved forward with priority to strengthen business structure (increased profitability and asset efficiency) according to plans
Slide 49: Frozen Foods: Initiatives for FY2021
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses III-2. Frozen Foods (Initiatives for ROIC of 5% in FY2025) Full-scale business structure strengthening in FY2021, and from FY2023, connect this to real business growth and achieve ROIC of 5% in FY202
Slide 50: Healthcare and Others: FY2020 initiatives
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses III-3. Healthcare and Others (ROIC improvement and business model transformation) Improve greater capital efficiency through expansion of core businesses and structural reform of the animal nutrition
Slide 51: Healthcare and Others: Key strategies for FY2021
Initiatives to Enhance Initiatives to Grow Our FY20 Results FY21 Forecast Corporate Value Businesses III-3. Healthcare and Others (ROIC improvement and business model transformation) Further advance sustainable organic growth and greater capital efficiency to achieve ROIC target (FY2022: 10% or more
Slide 52: Message from the CEO
Message from the CEO • FY2021 is the crucial point of the MTP structural reform, Phase 1. Focus on the implementation of the remaining structural reform and measures for a return to growth, Phase 2! • In this COVID-19 pandemic, I have become convinced that continuing business by focusing on employee
Slide 53: Contents
Contents I. FY2020 Summary Results and FY2021 Forecast II. FY2021 Initiatives to Enhance Corporate Value III. Initiatives to Grow Our Businesses Reference Material Appendixes: Consolidated Results FY2020 (Ended March 31, 2021) FY2021 Forecast by Segment Note: Business profit (consolidated) in this m
Slide 54: FY2021 Assumed Exchange Rate and Exchange Rate Sensitivity
FY2021 Assumed Exchange Rate and Exchange Rate Sensitivity Assumed exchange rate (vs. JPY) FY21 FY20 Actual FY20-25 Forecast Q4 Q3 Q2 Q1 MTP USD 105.00 106.09 104.49 106.23 107.63 107.00 EUR 125.00 127.81 124.61 124.08 118.59 123.00 THB 3.39 3.50 3.41 3.39 3.37 3.42 BRL 20.59 19.36 19.39 19.74 20.06
Slide 55: Forward-looking statements
Forward-looking statements, such as business performance forecasts, made in these materials are based on management's estimates, assumptions and projections at the time of publication. A number of factors could cause actual results to differ materially from expectations. This material includes summa