Maruha Nichiro, the world’s largest seafood company, reported higher net sales for its marine products segment, but lower income in the first quarter ending June 2023.
The Tokyo, Japan-based conglomerate's operating income of JPY 250.9 billion (USD 1.71 billion, EUR 1.58 billion) for the quarter ending June 2023 was up 7.9 percent from the JPY 232.6 billion (USD 1.59 billion, EUR 1.47 billion) it posted in the same quarter last year. The increase come despite a drop in its marine products business segment that resulted in a 2.3 percent decrease in operating income year-over-year.
Decreased catch volumes and high fuel costs resulted in a 29 percent drop in operating income for Maruha Nichiro’s marine products business – from JPY 5.3 billion (USD 36.2 million, EUR 33.5 million) in the previous quarter to JPY 3.8 billion (USD 26 million, EUR 24 million).
All of Maruha Nichiro's business segments except for aquaculture saw decreases in operating income. Its fishery business posted JPY 1 billion (USD 6.8 million, EUR 6.3 million) loss, down from a loss of JPY 500 million (USD 3.4 million, EUR 3.1 million) posted in the period ending June 2022. Its marine products trading business earned JPY 2.2 billion (USD 15 million, EUR 13.9 million), down from the JPY 2.3 billion (USD 15.7 million, EUR 14.5 million) it posted last year.
Maruha Nichiro's overseas business saw the largest drop of all its divisions, sinking 34.8 percent from JPY 2.8 billion (USD 19.1 million, EUR 17.7 million) in income in the quarter ending June 2022 to JPY 1.8 billion (USD 12.3 million, EUR 11.3 million) in the quarter ending June 2023.
Its aquaculture division increased its operating income from a loss of JPY 700 million (USD 4.7 million, EUR 4.4 million) to a positive income of JPY 800 million (USD 5.4 million, EUR 5.1 million). The company’s net sales for the segment totaled JPY 141.5 billion (USD 967 million, EUR 895 million) in the quarter ending June 2023, up nearly 10 percent from the JPY 128.8 billion (USD 880 million, EUR 814 million) it posted in the period ending June 2022.
The company’s fishery business saw higher year-over-year net sales, with JPY 8.9 billion (USD 60.8 million, EUR 56.3 million) sold compared to JPY 7.6 billion (USD 52 million, EUR 48 million), a 17 percent increase. Its aquaculture business sales remained flat at JPY 4.1 billion (USD 28 million, EUR 26 million).
Maruha Nichiro's marine products trading division reached JPY 73.4 billion (USD 501 million, EUR 464 million), a 2.1 percent increase over the JPY 71.9 billion (USD 491 million, EUR 454 million) it posted last year. And the company’s overseas business saw a big increase, jumping 21.8 percent from JPY 45.2 billion (USD 309 million, EUR 285 million) in the period ending June 2022 to JPY 55.1 billion (USD 376 million, EUR 348 million) in the period ending June 2023.
The reasons for the higher sales and lower income were varied, Maruha Nichiro said in its quarterly financial presentation. In its fisheries segment, sales of its major fish species, including Patagonian toothfish, were strong, but operating income decreased due to “reduce catch quantities caused by decreased fishing vessel operation and a surge in fuel costs.”
Sales in its aquaculture business benefited from increased sales volumes of yellowtail and amberjack amid high prices for major fish species. Sales increased in its largest segment, marine products trading, but the company said falling prices for frozen tuna and salmon resulted in lower incomes. Sales in its overseas business increased due to increased Alaska pollock resources as a result of Maruha Nichiro's acquisition of Alaska pollock vessels and quota from Cooke and Evening Star Fisheries in February 2022. But sluggish market prices and hurt its sales and decreased its operating income, it said.
Looking forward, the company said it will implement cost controls in its fishery business in response to high fuel prices, in addition to reassessing its operational structure, and increasing its in-house processing capabilities while its diversifying sales channels. In aquaculture, the company said it plans to work to mitigate the impact of higher fuel and feed costs by reviewing its operations and feed formulas.
For its marine products trading segment, the company said it will expand its sales “by strengthening cooperation between trading and wholesale and ensure stable profits through thorough inventory control.”
Finally, in its overseas market, the company said it plans to control costs by optimizing the allocation of its personnel and improving production efficiency.
Photo courtesy of Maruha Nichiro
