February 5, 2014

In the last quarter of 2013 due to a poisoning case, Maruha Nichiro's recall of 6.4 million packs of frozen products at its subsidiary Aqli Foods cost the Japanese conglomerate JPY3.5 billion (US$34 million).

The figure was unveiled in the company's results for the first three quarters of its 2013-14 financial year to the end of March, which showed a 38.9% on-year drop in net profit to JPY6.15 billion (US$60.7 million).

"As a result of incurring extraordinary losses including JPY3.5 billion (US$34.5 million) related to subsidiary Aqli Foods' recalling poisoned frozen food issue, the net income decreased by 38.9%," the company said.

Toshio Kushiro, the president of Maruha Nichiro, has announced that he and Aqli Foods' president Yutaka Tanaba would resign over the issue on March 31.

Sales for the first three quarters were up marginally, by 5.8%, to JPY658 billion (US$6.4 billion). Operating income fell 3% to JPY12 billion (US$118 million), a drop the company attributed to the weak yen. Ordinary income rose 11% to JPY15 billion (US$148 million), thanks to "foreign exchange gain through foreign exchange hedging", the company said.

The company expects its sales for the financial year (ending March 31, 2014) to reach JPY840 billion (US$8.2 billion), a 3.7% drop from the previous year. Annual operating income is forecast to drop 4.1% to JPY11.5 billion (US$113.5 million) and net income 17.4% to JPY4.5 billion (US$44.4 million).

On January 27, Kushiro issued an official apology for the food poisoning incident. A factory worker, Toshiki Abe, 49, has admitted to poisoning the food items, according to the police, saying he was dissatisfied with the way he had been treated at work.

Abe was arrested on suspicion of poisoning the products made at the Aqlifoods factory in Oizumi, Gunma Prefecture, with malathion on four occasions between last October 3 and October 7. More than 2,800 people have reported falling ill after eating the products, according to Japan's health, labour and welfare ministry.

Aqli Foods issued a voluntary recall notice last month covering 6.4 million packs of the products, including frozen pizzas and croquettes, sold in supermarkets.