Nissin Foods Holdings Co., Ltd. · TSE:2897
Nissin Foods — FY2019 Earnings Presentation
34 slides from Nissin Foods's earnings presentation, May 13, 2019
Slide 1: Consolidated Results for FY2019
Consolidated Results for FY2019 (Fiscal Year Ended March 31, 2019) Announced on May 9, 2019 This material was released on May 13, 2019 for the results briefing. WG NIssIN FOODS HOLDINGS CO., LTD. Stock Code: 2897
Slide 2: Introduction by the CFO
• My name is Yukio Yokoyama, and I am the CFO of NISSIN FOODS HOLDINGS. • Thank you very much for taking the time to come to our results briefing session today. • We will now report on our full-year results for the fiscal year ended March 31, 2019. • I will explain our business results for fiscal 20
Slide 3: Overview of FY2019 results
• I will now briefly explain the overview of our results for fiscal 2019. • For the consolidated financial year 2019, sales increased and profit decreased from the previous fiscal year, but neither sales nor profit reached their targets. • Revenue marked a record high for the 10th consecutive year,
Slide 4: Consolidated results: revenue and profit
• Revenue increased 10.1 billion yen year on year, to 451.0 billion yen. • On the other hand, operating profit decreased 6.2 billion yen year on year, to 29.0 billion yen, mainly due to an impairment loss of property in the U.S. and an impairment loss of intangible assets in Brazil, which totaled 9.
Slide 5: Revenue results by segment
• Next, I will explain the revenue results by segment. • First, revenue from the domestic businesses rose 4.8 billion yen from the previous fiscal year, to 327.9 billion yen. • Revenue from the overseas businesses increased 5.2 billion yen, to 123.0 billion yen. • In terms of the breakdowns of these
Slide 6: Revenue contribution by segment
• Regarding the main points, NISSIN FOOD PRODUCTS continued to achieve favorable results from its marketing activities. Its main brands “CHICHKEN RAMEN”, “CUP NOODLE” and “DONBEI” exceeded their previous year’s results, and instant rice such as “CURRY MESHI” continued to perform well, with revenue i
Slide 7: Operating profit results by segment
• Here, I will explain the operating profit results by segment. • In the domestic business, operating profit increased 7.4 billion yen year on year, to 36.3 billion yen. • In the overseas business, operating profit decreased 5.2 billion yen year on year, to 1.1 billion yen, partly due to an impairme
Slide 8: Operating profit contribution by segment
• Regarding NISSIN FOOD PRODUCTS, sales of its flagship brands “CHICKEN RAMEN”, “CUP NOODLE” and “DONBEI” were particularly strong, and operating profit declined 0.2 billion yen year on year, primarily due to soaring raw material costs, and depreciation expenses of Kansai Plant. • In the chilled and
Slide 9: Non-recurring items in operating profit by segment
• This slide shows year-on-year comparisons of operating profit by segment and the main items of non- recurring income and expenses included in it. • I will now explain the main non-recurring income and expenses incurred in fiscal 2019. • “Domestic others” includes 5.2 billion yen in gain on sales o
Slide 10: Analysis of operating profit
• I will now explain the analysis of operating profit. • Domestically, positive factors included the effects of changes in the product mix, efforts to reduce general and administrative expenses, and gain on sales of real estate. • On the other hand, negative factors included rising raw material cost
Slide 11: Management policy for fiscal 2020
• I will now explain our management policy for fiscal 2020. • In the current fiscal year, we will move forward with our business development under our management policy of “Steadily implement measures in response to changing market environment and work to strengthen profitability .” • Domestically,
Slide 12: FY2020 target figures
• I will now explain the target figures. • The target revenue for fiscal 2020 is 465.0 billion yen, up 14.0 billion yen or 3.1% year on year. • The target operating profit is 37.0 billion yen, up 8.0 billion yen or 27.7% year on year. • Profit attributable to owners of parent will increase 6.6 billi
Slide 13: FY2020 revenue plan by segment
• I will now talk about the main revenue plan by segment. • The target revenue from the domestic business is 337.8 billion yen, up 9.9 billion yen or 3.0% from the previous fiscal year. • The target revenue of NISSIN FOOD PRODUCTS is 200.0 billion yen, up 6.7 billion yen or 3.5% year on year. • For
Slide 14: FY2020 operating profit plan by segment
• I will now talk about our main operating profit plan by segment. • Our target operating profit for the domestic businesses is 32.4 billion yen, down 3.9 billion yen or 10.6% year on year. This is because of gain on the sale of real estate of 5.2 billion yen in the previous fiscal year. Excluding t
Slide 15: Non-recurring income and losses
• This shows the main non-recurring income and losses included in operating profit in fiscal 2020 and the previous fiscal year. • Currently, there is no non-recurring income or losses expected in fiscal 2020. • Please turn to the next slide. 14
Slide 16: Capital investment, depreciation and cash flow
• Capital investment is expected to total about 49.2 billion yen due to the third-phase construction cost of NISSIN FOOD PRODUCTS’ Kansai Plant that continues to be incurred this fiscal year, among others. • Depreciation and amortization is expected to increase by around 6.0 billion yen in total, du
Slide 17: Dividend for fiscal 2020
• With regard to the dividend for fiscal 2020, as we disclosed in a timely manner on May 9, we plan to pay an annual dividend of 110 yen per share, the same amount as in the previous year. • We intend to maintain our current dividend policy, which focuses on shareholders. • That concludes my present
Slide 18: Fiscal 2020 plan and recovery in profit
• As CFO Yokoyama explained earlier, the performance of this fiscal year was such a result due to impairment losses that were incurred in fiscal 2019. • As for fiscal 2020, we would like to work according to the plan stated on page 11 of this material. • Profit attributable to owners of parent was 1
Slide 19: Revision of Medium-Term Business Plan 2021
• I will now explain the revision of our Medium-Term Business Plan 2021. There are two reasons for this revision: to reflect the actual situation of the overseas business, and to exclude the originally included M&A from the budget. We revised operating profit down from 47.5 billion yen to 42.5 billi
Slide 20: Revised targets by segment
• We will now explain the revised targets by segment. • In the domestic instant noodles business, we revised revenue down by 5.0 billion yen, to 238.0 billion yen, and revised operating profit up by 0.4 billion yen, to 29.5 billion yen. • As for the chilled and frozen foods, confectionery, and bever
Slide 21: Corporate value and CSV initiatives
• Market capitalization of 1 trillion yen can be achieved if PER is 35 times higher, and we think that this is a rather high level. We will aim for it steadily as a continuous target, which is a target to be achieved along the way regardless of timing. • In addition, we will aim to improve our corpo
Slide 22: Review of five key themes
• I will now review our five key themes. • As for “promoting global branding for CUP NOODLES,” we set a target of 1.5 times the number of units compared to fiscal 2016, but we expect to achieve 1.2 times in fiscal 2019 (compared to fiscal 2016) and approximately 1.3 times in fiscal 2021. It is impor
Slide 23: Review of investments and future policy
• I will now reflect on our investments and explain our future policy. • In terms of business investment, we initially planned to invest 100.0 billion yen, and we have invested 23.5 billion yen to date. We invested the 23.5 billion yen in Premier Foods and Thai President Foods. • With regard to capi
Slide 24: Issues and policies by region and business
• I will now explain the issues and policies by region and business. • We will revise the prices of instant noodles to address the issue of increased costs. In addition, we will respond to a labor-saving and a labor population issue from a mid-term perspective by operating the Kansai Plant. • I will
Slide 25: Initiatives for a sturdier management structure
• In terms of our other initiatives, I will explain those “For Realization of a Sturdier Management Structure.” • As shown on the slide, we achieved “Smartwork 2000.” The workstyle reform has taken hold, and our focus is now shifting to expanding the scope of creative work. • We are also focusing on
Slide 26: Initiatives for enhancing corporate value
• With regard to our initiatives for enhancing corporate value, we and two other Japanese food companies have been selected as components of the Asia/Pacific Index of the Dow Jones Sustainability Indices. • As I mentioned earlier, we have also been certified as “the 2019 Certified Health & Productiv
Slide 27: SDGs
• Regarding the SDGs, there are 17 goals in the agenda, and our business falls under 13 of these. We feel that we meet a considerable number of them. • We believe that this is because our business structure and product structure have social value. • Thank you for your attention. 26
Slide 28: APPENDIX
APPENDIX 27
Slide 29: FY2020 Domestic Business: Policy and Activities by Segment (1)
FY2020 Domestic Business: Policy and Activities by Segment (1) 28 Generate cash and enhance profitability [CUP NOODLE] Acquiring new users and demand by expanding product lineup > — Strive to become a Century Brand Company + Actively target three strategic groups: young consumers, women and the elde
Slide 30: FY2020 Domestic Business: Policy and Activities by Segment (2)
29 FY2020 Domestic Business: Policy and Activities by Segment (2) > NISSIN CHILLED FOODS >» NISSIN FROZEN FOODS * Strengthen noodles genre, which is core domain and has high profit + Increase strength of single items by strengthening brand margins + Maximize profits through consolidation at Shizuoka
Slide 31: FY2020 Overseas Business: Policy and Activities by Segment (1)
FY2020 Overseas Business: Policy and Activities by Segment (1) >» US. + Improve earings structure + Reap benefits from penetration of price revisions + Increase premium products’ share of sales + Thoroughly review cost structure + Actively expand Premium Product category + “CUP NOODLES’, “CHOW MEIN’
Slide 32: FY2020 Overseas Business: Policy and Activities by Segment (2)
FY2020 Overseas Business: Policy and Activities by Segment (2) 3 > India > Thailand + Actively pursue an expansion in sales of “CUP NOODLES" to + Expand sales of differentiated added value products such as further strengthen the position as leader in the cup-type CUP NOODLES’ noodles market : Differ
Slide 33: FY2020 Overseas Business: Policy and Activities by Segment (3)
FY2020 Overseas Business: Policy and Activities by Segment (3) %2 a tam 1000 cataton Europe Actively roll out NB and OEM produets in key markets in Germany and the UK Roll out and enhance marketing under the concept of Authentic Asia Strive to obtain the No.1 position in “CUP NOODLES’and “Soba” at A
Slide 34: Disclaimer and notes
Information in this material is not intended to solicit sales or purchase of NISSIN FOODS HOLDINGS stock shares. The comments and estimates in this document are based on the company’s judgment at the time of publication and their accuracy is not guaranteed. They are subject to change without notice