The original disclosure in Japanese was released on April 17, 2024 at 15:00
April 17, 2024 | |
Company Name: | House Foods Group Inc. |
Representative: | Hiroshi Urakami, President |
(Securities Code: 2810, TSE Prime Market) | |
Contact: | Eiki Miyake, General Manager, Public & |
Investors Relations Division | |
(Tel: +81-3-5211-6039) |
Notice Regarding the Eighth Medium-term Business Plan
House Foods Group Inc. (the "Company") is pleased to announce that it has formulated its Eighth Medium-term Business Plan, which will run for three years from FY2024 to FY2026.
1. Period Covered
Three years from April 2024 to March 2027
2. Positioning of the Medium-term Business Plan
The Medium-term Business Plan has been formulated as an action plan ("To Do") that will enable the Company to get closer to its Group philosophy (Vision, "To Be"). The Company has established "Striving to become a high quality company that provides "Healthy Life Through Foods" Striving for growth by building a global value chain*" as a major theme of the Eighth Medium-term Business Plan. Setting priority themes to address customers, society, employees and their families, respectively, the Company will push ahead to transform into a high- quality company with a global presence.* Value chain
3. Consolidated Numerical Targets
To promote management with an awareness of cost of capital, starting with the Eighth Medium-term Business Plan, the Company will introduce ROIC as a new management indicator.
Please refer to the attached materials for details.
Eighth Medium-term Business Plan
Briefing
April 18, 2024
House Foods Group Inc.
Stock code 2810
https://housefoods-group.com/
Chapter 1: General Explanation of the Eighth Medium-term Business Plan
1-1: Review of the Seventh Medium-term Business Plan
1-2: Overview of the Eighth Medium-term Business Plan
1-3: For Customers
1-4: For Society
1-5: For Our Employees and Their Families
1-6: Consolidated Numerical Targets
1-7: "Three Responsibilities" KPIs
Chapter 3: For Our Employees and Their Families
3-1: Seventh Medium-term Business Plan - Diversity
Initiatives
3-2: Results of the Seventh Medium-term Business Plan and
Future Issues
3-3: Overview of the Eighth Medium-term Business Plan and
Themes for Action
3-4: Eighth Medium-term Business Plan KPIs
Chapter 2: For Society
2-1: Recognizing the Environmental Issues
2-2: The Story of Our Initiatives For Society
House Foods Group Long-term Environmental Strategy 2050
2-3: Action on Climate Change
2-4: Creating a Resource Recycling-oriented Society
Chapter 4: Financial Capital Policy
4-1: Recognition of the Current Situation and Action Plan
4-2: Introducing ROIC Management
4-3: Clarifying Resource Allocation
4-4: Strengthening of IR and SR Activities, Mechanisms to Enhance Value Sharing with Shareholders
*1 From FY2021, the Company has adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29) as the new standard.
*2 Allocation of the purchase price (PPA) regarding the business combination with the US-based Keystone Natural Holdings, LLC effected September 30, 2022 was completed during FY2023. Due to the completion of these accounting procedures, figures that reflect completion of the PPA are used.
Chapter 1: General Explanation of the Eighth Medium-term Business Plan
1-1: Review of the Seventh Medium-term Business Plan
1-2: Overview of the Eighth Medium-term Business Plan
1-3: For Customers
1-4: For Society
1-5: For Our Employees and Their Families
1-6: Consolidated Numerical Targets
1-7: "Three Responsibilities" KPIs
1-1: Review of the Seventh Medium-term Business Plan (Change in Consolidated Results)
- Net sales: Got close to but fell short of the initial plan, in part due to price revisions at Group companies
- Operating profit: Fell far short of the initial plan, in part due to changes in the business environment that were not incorporated into initial assumptions (prolonged effects from the COVID-19 pandemic, advancing inflation)
Old Accounting
Standards
Sixth Medium-term | |
Billion yen | Business Plan |
FY2020 | |
(Results) | |
Net sales | 283.8 |
Operating profit | 19.4 |
EBITDA *1 | 31.1 |
Ordinary profit | 19.8 |
Profit *2 | 8.7 |
New Accounting Standards
Seventh Medium-term Business Plan | |||||
FY2021 | FY2022 | FY2023 | Initial plan | Comparison with initial plan | |
(Results) | (Results) | (Forecast) | |||
253.4 | 275.1 | 302.8 | 305.0 | -2.2 | -0.7% |
19.2 | 16.7 | 20.0 | 26.0 | -6.0 | -23.1% |
30.1 | 28.5 | 33.5 | 40.4 | -6.9 | -17.1% |
21.1 | 18.3 | 21.2 | - | - | - |
14.0 | 13.7 | 18.0 | - | - | - |
*1 EBITDA: Operating profit (before amortization of goodwill) + Depreciation *2 Profit attributable to owners of parent
Copyright (c) House Foods Group Inc. All rights reserved. 4
1-1: Review of the Seventh Medium-term Business Plan (Management Indicators)
- Despite restoring earning capacity through price revisions and other measures, and working to improve asset efficiency such as by reducing cross-shareholdings, we fell short of our targets.
Five Indicators | Old Accounting |
Standards | |
Sixth Medium-term | |
Business Plan | |
FY2020 | |
(Results) | |
ATO | 0.77 times |
(Total asset turnover) | |
ROS | 6.8% |
(Return on sales) | |
EBITDA margin | 10.9% |
ROA | 5.3% |
(Return on assets) | |
ROE | 3.4% |
(Return on equity) |
New Accounting Standards | ||||
Seventh Medium-term Business Plan | ||||
FY2021 | FY2022 | FY2023 | Initial plan | Comparison with |
(Results) | (Results) | (Forecast) | initial plan | |
0.67 times | 0.71 times | 0.76 times | 0.80 times | -0.04 times |
7.6% | 6.1% | 6.6% | 8.5% | -1.9pt |
11.9% | 10.4% | 11.1% | 13.2% | -2.2pt |
5.1% | 4.3% | 5.0% | 6.8% | -1.8pt |
5.3% | 5.1% | 6.5% | 6.1% | +0.4pt |
- Reducing Cross-shareholdings and Acquiring Treasury Shares
• In the Seventh Medium-term Business Plan we planned to reduce cross-shareholders by 20% (with the reduction amount based on market value as of FY2020). We expect to achieve the planned reduction.
Results: FY2021 7.8%, FY2022 8.9%, FY2023 1st Half 2.9%, cumulative reduction up to the first half of FY2023 19.5%
• We planned to use the funds gained from these reductions to acquire treasury shares valued at 12 billion yen over the course of the Seventh Medium-term Business Plan. The acquisitions were completed as planned.
Results: FY2021 4 billion yen, FY2022 6 billion yen, FY2023 2 billion yen (as of January 31, 2024)
Copyright (c) House Foods Group Inc. All rights reserved. 5
1-1: Review of the Seventh Medium-term Business Plan (Three Responsibilities)
- Under the Seventh Medium-term Business Plan we conducted activities in line with priority themes to address each of the three responsibilities that we must fulfill to survive as a company that continually provides value: for customers, for our employees and their families, and for society.
Three | Themes | Summary | ||
Responsibilities | ||||
• For the Functional Ingredients VC and Soybean VC, we went ahead with growth initiatives and investment from a | ||||
Achievement of growth driven | back-casting perspective. | |||
by four value chains | • For the Spice VC, we made progress expanding production capabilities and expanding customer contact points, but | |||
are still part way through the process of establishment. | ||||
For | • The BtoB GOT (launch of House Gaban) and production GOT (optimization of spice production sites, etc.) yield some | |||
Realization of three GOT*1 | results. | |||
Customers | themes | • For the procurement GOT*2 there remain some challenges with the execution of business structural reforms from | ||
upstream. | ||||
• For the Value-added Vegetables VC, we proceeded to consider the development of business models with | ||||
Creation of new value through | collaborative creation partners. | |||
collaborative creation | • Despite working to create themes under a unified structure integrating business development, R&D and human | |||
resource development, the establishment of business is still a work in progress. | ||||
Establishment of a recycling- | • We made a 2050 carbon neutrality (Scope 1 and 2) declaration. We expect to achieve our CO2 Scope 1 and Scope 2 | |||
reduction targets.*3 | ||||
For | oriented model | |||
• We pursued initiatives to reduce CO2 emissions and waste through collaborative creation with stakeholders. | ||||
Society | Achievement of a society of | • Aiming to contribute to the advancement of health through our core business, we have worked to create health value | ||
healthy longevity | leveraging the strengths of each VC, but there remain challenges to developing themes in coordination with business | |||
activities. | ||||
For our | Implementation of job | • We define job satisfaction as a comfortable work environment × sense of worth, and implement measures | ||
satisfaction transformation | encouraging reduced working hours and the embracing of challenges. | |||
Employees | ||||
Support for demonstrating | • We have implemented measures aimed at achieving diversity in three areas: individual attributes, experience and | |||
and Their | aptitude. | |||
individuality and achieving | ||||
Families | integration | • We have taken steps to improve our infrastructure to enhance diversity, including the introduction of a new personnel | ||
system (House Foods). | ||||
*1 GOT: Initiatives to be conducted beyond the boundaries within the Group | ||||
*2 Renamed to Spice VC GOT from the Seventh Medium-term Business Plan | 6 | |||
*3 Per unit of production against FY2013 | Copyright (c) House Foods Group Inc. All rights reserved. |
1-2: Overview of the Eighth Medium-term Business Plan (Overall Picture)
Group philosophy, To Be
Through food, we aim to be a good corporate citizen, connecting
and collaborating with people to create smiles in their lives.
Eighth Medium-term Business Plan, To Do
Striving to become a high quality company that provides
"Healthy Life Through Foods"Striving for growth by building a global value chain
For Customers
Aim to achieve value chain management that delivers healthy life through foods globally
For Society | For our Employees and |
Their Families | |
Tackle the environmental impact caused by | Turn diversity into a strength and support |
our global corporate activities as corporate | initiatives to become a quality company in |
responsibility | powerful terms |
Spice | Functional Ingredients | Soybean | Value-added Vegetables |
(Creation of new value) | |||
Financial Capital Policy |
Copyright (c) House Foods Group Inc. All rights reserved. 7
1-2: Overview of the Eighth Medium-term Business Plan (Standing)
Eighth Medium-term Business Plan To Do
Striving to become a high quality company that provides "Healthy Life Through Foods"Striving for growth by building a global value chain
Eighth to Ninth | |
Building a Global | Doubling of |
Value Chain | business size |
Seventh
Striving for
Four Value
Chains
Sixth
GOT
Launch
- Building a value chain structure: laying the foundations enabling further growth in the future
- Establish four VCs as domains in which the Group can demonstrate strengths and identify growth opportunities
- For the Functional Ingredients VC and Soybean VC, go ahead with initiatives from a back-casting perspective. The Spice VC will end up at the center of change.
Fifth
Striving to
become a high quality company
- Start GOT (group-wide initiatives) to turn the Group's diversity into synergies
- Expand fields of business expansion from upstream to downstream with spice at the core (making VOX, Ichibanya, Gaban and Malony part of the Group)
Striving to become a high quality company
Copyright (c) House Foods Group Inc. All rights reserved. 8
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House Foods Group Inc. published this content on 26 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 April 2024 15:01:09 UTC.