May 22, 2006

Nippon Meat's reports 92 percent fall in profits

Japan's ban on US beef and rising energy costs took its toll on Nippon Meat Packers Inc as consolidated net profits tumbled 92 percent to JPY952 million (US$8.5 million) in the 2005 business year to March, the company announced Friday (May 19).

The meat processor registered a consolidated pretax profit of JPY2.34 billion (US$20.9 million), down 89.6 percent, on sales of JPY963.66 billion (US$8.5 billion).

However, sales of its mainstay processed foods rose despite the fall in profits.

Sales of pork and poultry increased but beef was slow-moving due to high Australian prices.

Cutting of manufacturing and distribution expenses and the closure of unprofitable assets was not enough to cover for higher energy costs and losses from the meat import business, the company said.

For the current year through next March, Nippon Meat expects consolidated net profits of JPY9 billion (US$80.3 million) on a more bullish outlook that the government may allow US beef imports as early as June.