Kyokuyo, Japan's fourth-largest seafood company, reported positive consolidated financial results for the year ended 31 March, 2022.
In its FY 2022 results, released 13 May, the Tokyo-based company reported net sales of approximately JPY 253.6 billion (USD 2 billion, EUR 1.9 billion), an increase of 1.8 percent over the previous fiscal year. It also reported operating profit of JPY 6.4 billion (USD 50 million, EUR 47.3 million), a gain of 37.2 percent. Both results were record highs for the company.
Kyokuyo's ordinary profit in 2021 was JPY 6.9 billion (USD 54 million, EUR 51.1 million), up 41.5 percent; and its profit attributable to the owners of the parent company totaled JPY 4.6 billion (USD 36.2 million, EUR 34.3 million), a 20.7 percent gain over FY 2021.
In presentation materials released on 19 May in Japanese only, the company said sales in its Fisheries Trading business segment edged up slightly, and its profits rose nearly 68 percent due to the strong sales growth of processed salmon and shrimp products to mass merchandisers, increased sales of high-value-added products like crab and fish roe, and thorough inventory control of North Sea fish.
In its overseas sales, scallop exports to China grew, while consumption recovered in North America.
In the company’s food business, revenue was off marginally, while its profits fell 38 percent from the previous fiscal year. Sales of frozen food for institutional and commercial use fell, which the company attributed to lower demand for fried seafood for school lunches. Demand for canned foods also fell, which the company attributed to people not stocking up at the same levels as in 2020. The main drag on earnings, it said, was soaring material prices and higher ocean freight rates.
In Kyokuyo's bonito and tuna business, its revenue rose 14 percent while its profits shot up by 95 percent. The company handled more imported bluefin tuna, and its processed tuna was sold well to mass-merchandisers and conveyor-belt sushi shops. Profits from its domestically farmed bluefin tuna operations improved, and its overseas purse-seining profits also rose on higher skipjack prices.
In the company’s logistics business, revenue increased by about 9 percent, but profits declined 41 percent. The company said it used more domestic trucking due to interruptions in marine transport and while outbound cargoes increased, the interruptions held up imports – resulting in less utilization of warehouse capacity.
During its 2022 fiscal year, Kyokuyo undertook several initiatives under its medium-term management plan. To expand its overseas seafood business, the food sector was reorganized from a product-specific to a business-specific organization. In addition to the reorganization, the Kyokuyo Global Seafoods Co. factory in Thailand was completed and will become the company’s main overseas plant for the production of boiled and grilled fish, sushi, and other products, supplying global markets.
The company said it stabilized its earnings from its fish-trading and aquaculture businesses, while accelerating a shift to more-processed products, including for household use. It also agreed, along with trading company Itochu Corp., to distribute salmon from the domestic land-based Soul of Japan Co. aquaculture facility under construction in Tsu City, Mie Prefecture.
The company also launched a new large skipjack tuna seine vessel with a plan to operate it in the central Pacific. It is meant to compete for skipjack with large vessels recently introduced by other fishing nations, Kyokuyo said.
Photo courtesy of Kyokuyo
