Nippon Suisan Kaisha (Nissui) has reported that income deteriorated significantly for the fiscal year that ended on March 31, 2016, due largely to the drop in fish prices and rising costs in its salmon and trout aquaculture operations in South America.
The Tokyo-headquartered company posted a loss of ¥5.9 billion. This was offset by positive factors (+¥2.7 billion) including the absence of allowance for doubtful trade receivables in Asia during the previous fiscal year, in addition to strong results of non-consolidated marine products/food products businesses (+¥1.8 billion) and domestic/overseas food products business receipts (+¥2 billion).
However, operating income increased by 7% year-on-year, and net income reached a historic high for the second consecutive year.
Meanwhile, consolidated net profit in the first quarter of the current fiscal year (April through June) fell a sharp 58% to ¥1.6 billion compared with the like period in 2015. Consolidated sales during the most recent three-month period slipped 3% to ¥156.3 billion, in comparison with previous year results.
While the rising value of the yen has reduced the profitability of overseas operations, an slump in consumer demand and lower prices fetched for value added products in major markets outside of Japan has also negatively impacted the bottom line. For example, its Gorton’s frozen fish retail line in North America has lost market share due to fierce competition.
In an effort to stimulate demand, the Gloucester, Massachusetts-based subsidiary has launched a “Go Wild, Go Real, Go Fish … Go Gorton’s” campaign. It kicked off earlier this year with a focus on Gourmet Fillets and Simply Bake products, mostly in the digital space.
The multi-year strategy is to introduce a new way of talking about the brand and engage more directly with consumers via messages that are directly tied to the company’s values and heritage, which date back to 1849.
The food products and fisheries businesses (which includes Sealord in New Zealand) are the mainstays of the Nissui Group, which is also engaged in cold storage logistics and the production of fine chemicals and pharmaceuticals.
The company sells a wide variety of products in the Japanese home market, including frozen prepared foods for household and commercial uses, fish sausage, chikuwa, and imitation crab and fish paste.
In North America, the Group entered into the field of production and sales of precooked frozen seafood in the latter half of the 1990s. Afterwards, Gorton’s and King & Prince came under the Nissui flag in 2001 and 2005, respectively. In Europe, Cité Marine joined the group in 2007 as a first step toward developing a food production base in France. And during the same year in China, Tai Mei Food entered the Nissui fold.
