Nissin Foods Holdings Co., Ltd. · TSE:2897
Nissin Foods — FY2024 Earnings Presentation
60 slides from Nissin Foods's earnings presentation, May 13, 2024
Slide 1: Financial Results for FY 3/2024
Financial Results for FY 3/2024 May 13, 2024 NISSIN FOODS HOLDINGS CO., LTD. (TSE Stock Code: 2897) Financial Results Presentation: May 14, 2024
Slide 2: Agenda
I. FY 3/2024 Financial Results and FY 3/2025 Plan ………………………………P2~ Takashi Yano, Executive Officer and CFO II. Progress of Mid- to Long-Term Growth Strategy and Revised KPIs ………P14~ Koki Ando, Representative Director, President and CEO Noritaka Ando, Executive Vice President & Representative Director
Slide 3: Today's Points
Today's Points Point 1: FY 3/2024 Financial Results Revenue and every profit reached record highs. Consolidated profits increased by double-digit percentage year-on-year for a second consecutive fiscal year. Core operating profit of the Overseas business and Domestic non-instant noodles business
Slide 4: FY 3/2024 Financial Results
FY 3/2024 Financial Results 3
Slide 5: FY 3/2024 Consolidated Financial Summary
FY 3/2024 Consolidated Financial Summary Institutional accounting basis Constant currency basis Bil. yen YoY change YoY change FY 3/2024 FY 3/2024 Amount Ratio Amount Ratio Revenue 732.9 + 63.7 + 9.5% 712.5 + 43.3 + 6.5% Core operating profit 80.6 + 20.4 + 33.9% 78.4 + 18.2 + 30.2% of existing busin
Slide 6: Analysis of Core OP of Existing Businesses
Analysis of Core OP of Existing Businesses (Bil.Yen) Domestic (15.8), Overseas +0.6 Domestic and Overseas : +) Price revisions etc. Domestic︓- ) Increase in raw materials and energy costs etc. +44.2 Donation (2.9) YoY Overseas +20.4 bil. yen +11.6 +5.1 +2.2 (15.2) +34% Domestic (11.0) (4.8) +32.5 Ma
Slide 7: Financial Summary by Segment
Financial Summary by Segment • Revenue and profit of all three businesses increased due to steady demand even after price revisions. • Overseas business drove overall profit growth. Profit increased significantly in Domestic non-instant noodles business due to strong sales of beverage and snack prod
Slide 8: Revenue Results by Segment
Revenue Results by Segment • Consolidated revenue increased mainly due to price revisions. Institutional accounting basis Constant currency basis Bil. yen YoY change YoY change FY 3/2024 FY 3/2024 Amount Ratio Amount Ratio NISSIN FOOD PRODUCTS 232.2 + 12.0 + 5.5% 232.2 + 12.0 + 5.5% MYOJO FOODS 43.5
Slide 9: Core OP Results by Segment
Core OP Results by Segment • Overseas business, NISSIN FOOD PRODUCTS, NISSIN YORK and KOIKE-YA drove the overall growth, resulting in 1.3 times increase year-on-year. FY 3/2024 Institutional accounting basis FY 3/2024 Constant currency basis Bil. yen Other Income YoY change YoY change OP and Expense
Slide 10: FY 3/2025 Plan
FY 3/2025 Plan 9
Slide 11: FY 3/2025 Full-Year Earnings Plan
FY 3/2025 Full-Year Earnings Plan • We aim for revenue growth of 7.1% YoY and core operating profit of existing businesses is projected to increase by 5.0% YoY to 84.6 billion yen. • We also aim for record highs in both revenue and profit at each stage. YoY Revenue 785.0 Bil. yen +7.1% Mid-single di
Slide 12: FY 3/2025 Plan by Segment
FY 3/2025 Plan by Segment Revenue (IFRS) Core Operating Profit (Non-GAAP) Bil. Yen FY 3/2025 FY 3/2024 Results FY 3/2025 FY 3/2024 Results Plan Revenue YoY change Plan Core OP YoY change NISSIN FOOD PRODUCTS 241.5 232.2 + 9.3 + 4.0% 30.5 29.5 + 1.0 + 3.2% MYOJO FOODS 43.5 43.5 + 0.0 + 0.1% 2.9 2.7 +
Slide 13: Analysis of Core Operating Profit of Existing Businesses by Segment
Analysis of Core Operating Profit of Existing Businesses by Segment (Bil. yen) YoY Change +4.0 Bil. yen +5.0% +) Increased sales due to effective marketing and efficient sales promotion. - ) Increase in raw materials costs, energy costs, logistics costs, personnel costs. FY 3/2024 Core NISSIN FOOD M
Slide 14: EBITDA and Cash Flow
EBITDA and Cash Flow EBITDA Cash Flows (Bil. Yen) 105.7 40.0% (Bil. Yen) 100.0 35.0% 90.0 94.1 84.5 30.0% 72.7 80.0 76.0 74.9 64.8 57.5 52.9 70.0 67.5 25.0% 40.7 60.0 20.0% 53.1 13.1 50.0 15.0% 40.0 14.4% 15.0% 14.4% 13.1% (3.5) 11.8% 12.6% 10.0% (10.1) 30.0 (19.0) (26.5) (32.1) (26.3) 5.0% (40.4) 2
Slide 15: Progress in Mid- to Long-Term Growth Strategy and Revised KPIs
Progress in Mid- to Long-Term Growth Strategy and Revised KPIs 14
Slide 16: Growth Story for the Mid- to Long-Term
Growth Story for the Mid- to Long-Term (presented in May 2021) Creating Shared Value (CSV) Management based on our MVV (Mission, Vision, and Values) To achieve sustainable growth while solving environmental and Mission Vision Value social issues as an Peace will come to the world Create foods to “EA
Slide 17: Financial KPI: Three-Year Review and Future Direction
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Mid- to Long-Term Growth Strategy: Three-Year Review and Future Direction • We have already achieved many of our FY 2030 financial KPI targets. Item Category Item Mid- to Long-Term Targets
Slide 18: Review and Future Prospects
Review and Future Prospects Three-Year Review ❶ Built a resilient business structure under a rapidly changing external environment by strengthening the cash generation capabilities of existing businesses and inorganic growth, achieving FY 3/2031 profit level targets ahead of schedule. ❷ Grew EBITDA
Slide 19: Approach to Capital Allocation for ROE Improvement
Approach to Capital Allocation for ROE Improvement • Achieved profit target level for FY 3/2031 in three years. In conjunction with business growth, EBITDA constantly exceeds 100 billion yen, fostering an environment to generate and increase cash steadily beyond initial forecasts. • We intend to all
Slide 20: Overall Picture of Mid- to Long-Term Economic Value Targets
Overall Picture of Mid- to Long-Term Economic Value Targets • We are committed to four Mid- to long-term economic value targets through CSV management: (1) Sustainable profit growth, (2) Efficient use of capital, (3) Safe use of debt, and (4) Stable shareholder returns. 1 Growth Potential Core Opera
Slide 21: NO LIMIT TO GROWTH
NO LIMIT TO GROWTH Revenue Core Operating Profit * * Market Cap 1 trillion 100 billion 2 trillion yen yen yen 20 * Core operating profit of existing businesses
Slide 22: Mid- to Long-Term Growth Strategy
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Mid- to Long-Term Growth Strategy • Post-FY2023 surge, the plan targets mid-single digit organic growth, with milestones of 1 trillion-yen revenue and 100-billion-yen core operating profit
Slide 23: Roadmap to 1 Trillion Yen in Revenue (Organic)
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Roadmap to 1 Trillion Yen in Revenue (Organic) Revenue Growth Major Growth Drivers By FY 2030 Revenue (Bil. Yen/institutional accounting basis) 1 trillion Instant Noodles Business 1,000 -pl
Slide 24: Roadmap to 100 Billion Yen in Core Operating Profit: By Factor
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Roadmap to 100 Billion Yen in Core Operating Profit of Existing Businesses(Organic) : By Factor • Maintain mid-single digit, despite higher depreciation charges in connection with growth in
Slide 25: Roadmap to 100 Billion Yen in Core Operating Profit: By Business
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Roadmap to 100 Billion Yen in Core Operating Profit of Existing Businesses(Organic) : By Business • Overseas high-profit-margin businesses with ample room for growth to drive business overa
Slide 26: Capex Plan
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Capex Plan • Increase production capacity to eliminate bottlenecks and shift to a greater growth trajectory, amid rising global demand for instant noodles. • Plan to increase capex in the D
Slide 27: Acceleration of Global Expansion
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Acceleration of Global Expansion • Pursue global expansion into countries and regions at various stages of instant noodles market acceptance and national income levels • Conduct aggressive
Slide 28: Global Expansion of the CUP NOODLES Brand
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Global Expansion of the CUP NOODLES Brand • FY2023 performance was driven by the high-profit-margin overseas business, resulting in a 40% increase in overall volume of the CUP NOODLES brand
Slide 29: Develop a Premium Strategy in the U.S.
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Develop a Premium Strategy in the U.S. • Engage in aggressive marketing targeting young consumers, who account for about half of the U.S. population and are expected to grow in purchasing p
Slide 30: Environmental Strategy: EARTH FOOD CHALLENGE 2030
Environmental Strategy: EARTH FOOD CHALLENGE 2030 Our Challenge to Utilize Finite Resources Effectively Source Sustainably Conserve Natural Create a World without Earth Resources Waste Material Domestic results are covered Sustainable palm oil Overall water use Recycling rate in production process C
Slide 31: Scope 1+2 Progress
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Scope 1+2 Progress • Reduced CO2 emissions well under planned standard (2020), mainly through transition to renewable energy options in Japan, Europe, and the U.S. SCOPE Unit 単位 2020 2021 2
Slide 32: Scope 3 Progress
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Scope 3 Progress • Scope 3 emissions also well under planned standard (2020), largely due to increased use of RSPO palm oil and use of biomass ECO cups. SCOPE Unit 2020 2021 2022 2023 2023v
Slide 33: Initiatives to Strengthen Human Capital - ISO 30414 Certification
Initiatives to Strengthen Human Capital - ISO 30414 Certification (Mar.24) • In the words of our founder, Momofuku Ando, “Our People Define Our Worth. Success's Verdict Rests with the Universe.” True to these words, we conduct initiatives to reinvigorate our people and organizations, believing that
Slide 34: Measures to Recruit and Retain the Right People in the Right Places
Measures to Recruit and Retain the Right People in the Right Places • It is essential that we place the right person to play an active role in the right place--employees with diverse experience, expertise, and values--if we are to achieve the strategies defined under our Mid-to Long-Term Growth Stra
Slide 35: Example Initiatives Communicating Mission, Vision, and Values (MVV)
Example Initiatives Communicating Mission, Vision, and Values (MVV) • We focus on communicating our Mission, Vision, and Values (MVV) and the NISSIN 10 Rules (action guidelines) to serve as the basis of our activities and unite employees around the world. Employees sold CHICKEN RAMEN at retail outle
Slide 36: Surpassed 25 Million Meals! Accelerating Brand Buzz!
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Surpassed 25 Million Meals! Accelerating Brand Buzz! ■2023 Japan Naming Award Rookie Division* Grand Prize * Only items within 2 years of release or announcement are eligible. ■Brand awaren
Slide 37: KANZEN MEAL to 10 Billion Yen!
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 KANZEN MEAL to 10 Billion Yen! FY 3/2026 Becoming a 10 billion yen brand (market price conversion) FY 3/2023 Act. : 3.0 billion yen FY 3/2024 Act. : 5.0 billion yen FY 3/2025 Plan: 7.0 bill
Slide 38: Spring 2024 Product Lineup
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Brand Understanding Through Improved Communication! Spring 2024 Product Lineup NISSIN YAKISOBA U.F.O. Corn Cream KOIKOI YATAIFU YAKISOBA Potage Secured Brand Recognition Status! Appealed to
Slide 39: Strengthening the Frozen Food Category
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Reformulated in December 2023! Strengthening the Frozen Food Category! Total of 21 products* Repeat rate at an astounding 55%**! *(As of end of March 2024) **F2 conversion rate, as of end o
Slide 40: Expanding Into Other Food Categories Through Collaborations
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Expanding Into Other Food Categories Through Collaborations! Retail (Delicatessen) and Restaurant Food Manufacturers in Other Fields Restaurant CVS channel SM channel Industry Launched Laun
Slide 41: Expansion of Company Cafeteria Business
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Expansion of Company Cafeteria Business (Meal Services, Installations)! Cafeteria Meals Installations Etc. Etc. Increasing number of companies using our products as part of corporate health
Slide 42: Initiatives With Meiji Yasuda Life Insurance Company
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Initiatives With Meiji Yasuda Life Insurance Company Plans to study and develop initiatives to contribute to improved health and QOL for policyholders through KANZEN MEAL ・ Quality of Life
Slide 43: Creating New Value in Optimized Nutri-Dense Meals
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Creating New Value in Optimized Nutri-Dense Meals! Developing Optimized Nutri-Dense Meals for diabetes and hypertension patients (improved QOL related to dietary restrictions) Model for pat
Slide 44: Creating New Value in Optimized Nutri-Dense Meals: Seniors
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Creating New Value in Optimized Nutri-Dense Meals! New clinical trial results with seniors Optimized Nutri-Dense Meals for Seniors: Fortified with protein, n-3 fatty acids, etc. Improvement
Slide 45: Role as Disaster Relief Food
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Role as Disaster Relief Food Instant Foods as Disaster Relief Foods Water, bread, rice balls Hot instant noodles (CUP NOODLE, etc.) Optimized Nutri-Dense Meals (KANZEN MEAL, etc.) for prolo
Slide 46: Steady Progress in a Variety of Touchpoint Initiatives
Strengthen Cash Generation EARTH FOOD Capabilities of Existing Pursue New Businesses Businesses CHALLENGE 2030 Steady Progress in a Variety of Touchpoint Initiatives! 1 Packaged Foods Retail Sales Lunch Boxes, Prepared Foods, Base Ingredients ２ Employee Cafeterias ３ Healthcare Cooperation Health man
Slide 47: Status of Our Businesses
Status of Our Businesses 46
Slide 48: Domestic Instant Noodles Business
Domestic Instant Noodles Business • Revenue and profit increased due to price revisions besides expanding sales of main products despite rising raw materials costs Revenue (Bil. Yen) FY 3/2023 FY 3/2024 350 NISSIN FOOD PRODUCTS (+5%) 300 Cup type : New products such as CUP NOODLE GUZAI MAMIRE series
Slide 49: Domestic Non-Instant Noodles Business
Domestic Non-Instant Noodles Business • Revenue and profit increased due to contributions from YORK, with keeping strong performance of lactobacillus beverages PILKUL series and TOKACHI DRINK YOGURT, and KOIKE-YA, with strong sales from main products Revenue (Bil. Yen) FY 3/2023 FY 3/2024 (+6%) : Ne
Slide 50: The Americas
The Americas • Revenue and profit increased year on year due to the strengthening of propositions and promotion of high-value-added products as well as the impact of price revisions Revenue (Bil. Yen) FY 3/2023 FY 3/2024 U.S. : Increased due to strengthening of sales of high-value-added products and
Slide 51: China (incl. H.K.)
China (incl. H.K.) • Core operating profit increased mainly due to lower raw material costs year on year, besides, flagship products are showing signs of recovery. Revenue (Bil. Yen) FY 3/2023 FY 3/2024 Hong Kong and : Recovering sales volume of bag type noodles, increased sales 80 others due to for
Slide 52: Asia
Asia • Profit increased in all regions, mainly in Thailand, due to price revisions in each country and lower material costs Revenue (Bil. Yen) FY 3/2023 FY 3/2024 25 By descending order of revenue 20 15 Thailand ：Increased (Forex impact +0.5 Bil. yen) 10 India ：Increased (Forex impact +0.2 Bil. yen
Slide 53: EMEA
EMEA • Continued revenue growth trend in the fast-growing instant noodles market Revenue (Bil. Yen) FY 3/2023 FY 3/2024 30 25 20 • CUP NOODLES, Soba and Demae Ramen brands continued to perform well • Increased mainly in the U.K., Germany, and France 15 (Forex impact +2.4 Bil. yen) 10 5 7.6 11.3 9.7
Slide 54: Appendix
Appendix 53
Slide 55: Major Regional Review and Efforts Toward 2030 (Domestic)
Major Regional Review and Efforts Toward 2030 (Domestic) Domestic Instant Noodles Business Domestic Non-Instant Noodles Business • Strategically captured the demand for instant noodles, which are relatively more Chilled and Frozen Foods/Beverage Confectionery affordable during inflation despite pric
Slide 56: Major Regional Review and Efforts Toward 2030 (Overseas)
Major Regional Review and Efforts Toward 2030 (Overseas) The Americas China (Incl. H.K.) • U.S.: Significant price revisions implemented in August 2022; transformed business structure to a profitable structure. Expanding premium products and developing the market. • Hong Kong: Despite the impact on
Slide 57: Revenue and Volume in the Americas and Overseas (YoY)
Revenue and Volume in the Americas and Overseas (YoY) Jan.- Mar. Base products: + mid-single digit % Premium products: + high-single digit % FY 3/2024 Apr. - Jun. Jul. - Sep. Oct. - Dec. Jan. - Mar. (Apr. - Mar.) FY 3/2024 Revenue Volume Revenue Volume Revenue Volume Revenue Volume Revenue Volume -
Slide 58: Major Price Revisions (Domestic)
Major Price Revisions (Domestic) FY 3/2020 ~ FY 3/2021 FY 3/2022 FY 3/2023 FY 3/2024 FY 3/2025 NISSIN FOOD Business Noodles Instant PRODUCTS MYOJO FOODS Jun. 19 (NISSIN FOOD 4-8%、 Jun.(NISSIN FOOD 5-12%、 Jun. (NISSIN FOOD 10-13% MYOJO 3-7%) MYOJO 6-12%) MYOJO 9-12%) CHILLED Chilled / frozen foods FO
Slide 59: Major Price Revisions (Overseas)
Major Price Revisions (Overseas) FY 3/2020 ~ FY 3/2021 FY 3/2022 FY 3/2023 FY 3/2024 FY 3/2025 U.S. May (Bag, Cup) Jan. (Bag, Cup) Aug. Average 36% Apr. 19 (Bag, Cup) The Americas (Bag, Cup) Brazil May 20 Nov. 20 Feb. 21 Jul. (Bag) Feb. (Bag, Cup) May (Bag, Cup) Jun. (Bag, Cup) (Bag, Cup) (Bag, Cup)
Slide 60: Cautionary statement on forward-looking information
Company plans, business forecasts, strategies, and other information contained in this document are based on management judgments derived from information available at the time of this publication. Be aware that these are only future projections, and actual results may differ due to various risks an