Nisshin Seifun : Presentation Material (First Six Months of Fiscal 2023 and Fiscal 2023 Forecasts, Medium-Term Management Plan 2026)

Delivering Good Health and Reliability

First Six Months of

Fiscal 2023

Results Briefing Meeting

October 28, 2022

Nisshin Seifun Group Inc.

Delivering Good Health and Reliability

Contents

1. First Six Months of Fiscal 2023 and Fiscal 2023 Forecasts
2. The Nisshin Seifun Group Medium-Term Management Plan 2026

1. Basic Policy

1. Key Topics in Strategy To Enhance Business Competitiveness III. Key Strategies to Accelerate the Group's Growth

IV. Environment Policy

V. Capital Policy

VI. Details of Final-Year Numerical Targets

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Delivering Good Health and Reliability

1. First Six Months of Fiscal 2023 and Fiscal 2023 Forecasts

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1. Impairment Loss on the Australia Flour Milling Business (Allied Pinnacle Pty Ltd.)

Delivering Good Health and Reliability

As a result of carefully examining the feasibility of the business plan for the Australia flour milling business and formulating a new business plan after reviewing the market and current business environment that have changed due to the COVID-19 pandemic, impairment loss was recorded in 2Q Fiscal 2023 due to the deviation from the original business plan.

 Impairment loss

A$600 million (¥55.8 billion)	[Breakdown] Goodwill	: ¥31.4 billion
*No impact on the Group's results other than the Australia flour milling business	Intangibles	: ¥7.7 billion
PP&E	: ¥16.7 billion

 Major factors resulting in the impairment loss

Change in the market due to the impact of strict COVID-19 measures in Australia (such as Allied Pinnacle's sluggish business results due to a slowdown in the in-store bakery market, which is Allied Pinnacle's major customer base)

Effects of various cost increases beyond expectations due to supply chain disruptions caused by COVID-19 and a sharp rise in prices of resources and grain caused by the situation in Ukraine (such as delay in price pass-through)

• Outlook for the Australia flour milling business

Explained in the Medium-Term Management Plan 2026

• Impact on consolidated financial results

Results forecast revision (1H: downward revision of quarterly profit; Full year: upward revision of operating profit and ordinary profit, downward revision of profit)

Amount of decrease in depreciation and amortization burden (estimated to be about ¥6.0 billion annually (estimated to be about ¥2.6 billion in Fiscal 2023))

The annual dividend remains unchanged from the initial forecast (scheduled to remain unchanged from the previous fiscal year at ¥39 per share)

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１2. ．First第２Six四半Months期 実績Results of Fiscal 2023

Delivering Good Health and Reliability

Net sales increased mainly due to the implementation of wheat price revisions in the domestic flour milling business, higher wheat prices in the overseas flour milling business and foreign currency translation effects, and steady sales in the prepared dishes and other prepared foods businesses.

Operating profit increased due to strong bran prices in the domestic flour milling business and favorable performance in the overseas flour milling business.

Quarterly loss due to impairment loss in the Australia flour milling business based on re-examination of the business plan, considering market changes influenced by strict COVID-19 measures in Australia.

			* Figures rounded down to nearest million yen
		Forecasts (May release)	First Six Months of
	First Six Months
	Fiscal 2022 Results
	of Fiscal 2023
(Millions of yen)	Results	Change	Change

	Net sales	388,742	370,000	＋5.1％	325,727	＋19.3％
	Overseas sales	32.6％	-	-	26.5％	-
	ratio
	Operating profit	15,919	15,000	＋6.1％	15,568	＋2.3％
	Ordinary profit	17,220	15,500	＋11.1％	17,425	(1.2)％
	Profit attributable	(37,795)	9,000	-	9,957	-
	to owners of parent
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