Tokyo, Japan-based Marubeni Corporation, in its annual results for the fiscal year ended March 31, 2020, reported a net loss attributable to owners of the parent of JPY 197.5 billion (USD 1.8 billion, EUR 1.6 billion), a 428.3 percent decline from the previous year.
Those losses are mainly due to one-off impairment losses on oil and gas assets, its U.S. grain business, its Chilean copper mining business, overseas power and infrastructure, and aircraft leasing. It projects a return to the black in the fiscal year ending in March 2021.
The trading company is ranked 14th in annual revenue generation among seafood companies worldwide. Marubeni owns Seattle, Washington, U.S.A.-based North Pacific Seafoods and handles 10 percent of wild salmon trading worldwide, and it has a stake in U.S. distribution company Eastern Fish Company, which has a 6 percent share of the U.S. shrimp market.
The net profit attributable to the owners of the parent from the company’s Food segment decreased by JPY 200 million (USD 1.8 million, EUR 1.6 million), or 0.9 percent, year-on-year to JPY 19.5 billion (USD 181.7 million, EUR 159.6 million). Higher grain trading margins were offset by unfavorable foreign exchange rates and an impairment loss on tangible assets of the North American wild salmon/trout business. The segment is forecast to decline 12.8 percent to JPY 17 billion (USD 156 million, EUR 138 million) in FY2021.
Regarding effects of COVID-19, the company expects revenue from food and utilities to be fairly stable. Its trading business is likely to decline by over half, while profits from capital goods (machinery, ships aerospace) and commodities (oil/gas, copper) will plummet by 88 percent.
The company will focus on improving its debt-to-equity ratio (currently at 1.16) to weather the declines.
Yokohama Reito (Yokorei), which is the 27th-largest seafood company by revenue, also saw losses. The Yokohama-based company uses a fiscal year ending in September. In its H1 report, issued 28 May, sales fell by 19 percent from the first half of the previous year. Profit attributable to owners of the parent totaled JPY 1.28 billion (USD 11.9 million, EUR 10.5 million), a year-on-year decline of 28.7 percent.
In its Refrigerated Warehousing Business, reduced shipments due to COVID-19 led to lower handling fees, but were offset by more storage fee revenue as inventories accumulate, resulting in a slight profit rise.
In the Food Sales Business, the marine products category posted lower sales and profit. Atka mackerel and squid inventories were reduced, but salmon and trout inventories were high, resulting in lower prices. Mackerel sales volumes declined owing to poor catches in major domestic fishing ports and a subsiding of the recent boom for canned mackerel. Eel prices fell on a higher glass eel catch, and crab inventories moved slowly. Sales grew in the company’s Norway trout cultivation business thanks to a good haul, but profit fell on higher production costs.
The overall Food Sales Business saw a 24 percent decline in sales, to JPY 44 billion (USD 411 million, EUR 361 million), and a fall in profit of 167 percent, ending with a JPY 277 million (USD 2.5 million, EUR 2.2 million) loss.
The company withdrew its full-year forecast, given the unpredictable business environment attributable to COVID-19.
