Nisshin OilliO : Financial Results Briefing for the Year Ended March 31, 2024

The Nisshin OilliO Group, Ltd.

FY2023

Financial Results Briefing

May 17, 2024

Summary of Financial Results for FY2023

3

Summary of Financial Results for FY2023 and Earnings Forecast for FY2024

■Financial Results for FY2023

• Consolidated net sales decreased year on year to 513.5 billion yen, whereas consolidated operating profit increased year on year to 20.8 billion yen.
• • Domestic oil and fat sales decreased year on year, with a slight decline in sales volume, mainly because of lower sales prices affected by raw material prices, as well as a decline in sales volume of meal due to reduced crushing volume. Profits increased year on year thanks to successfully establishing appropriate sales prices and to the fact that the decline in sales prices was more limited than that of the decline in costs.
  • Overseas processed oil and fat posted lower sales and profits than a year ago due to lower sales prices, lower refining margin as well as the effects from mark-to-market valuation on futures and other products, despite increased sales volume.

■Earnings Forecast for FY2024

• Higher consolidated net sales of 535.0 billion yen and consolidated operating profit of 21.0 billion yen (the same level as FY2023).
• • Consolidated net sales are expected to increase due to higher sales volume in domestic oil and fat and higher unit sales prices in overseas processed oil and fat.
  • Consolidated operating profit is expected to be on par with the previous year thanks to increased profits from processed oil and fat as well as processed food and materials, despite decreased profits from oil and meal.
  • • Domestic oil and fat sales volume is expected to increase, but profit is expected to decrease due to lower gross profit per unit, deteriorating cost of olive oil and higher SG&A expenses.
    • Overseas processed oil and fat is expected to post higher profit due to improved gross profit per unit reflecting higher unit sales prices and effects from mark-to-market valuation on palm oil transactions. Processed food and materials is also expected to post higher profits due to increased MCT sales volume and lower raw material costs.

Overview of Financial Results for FY2023

4

(Billion yen)

	FY2023 results	FY2022 results	YoY change
	Amount	Percentage
Net sales	513.5	556.5	(43.0)	(7.7)%
Operating profit	20.8	16.1	+4.6	+28.8%
Operating profit	4.1%	2.9%	ー	+1.1pts
margin
Ordinary profit	20.0	16.2	+3.7	+23.3%
Profit attributable to	15.1	11.1	+3.9	+35.8%
owners of parent

Earnings Forecast

for FY2023

(Disclosed in

February)

510.0

20.5

4.0%

19.5

13.5

* Amounts of less than 0.1 billion yen are rounded down.

5

FY2023 Results by Business Segment (Net Sales and Operating Profit)	(Billion yen)
		FY2023 results	FY2022 results	YoY change
		Amount	Percentage
Net sales	513.5	556.5	(43.0)	(7.7)%
Oil and Fat	421.9	468.3	(46.4)	(9.9)%
	Oil and Meal	317.9	350.3	(32.3)	(9.2)%
	Processed Oil and Fat	103.9	118.0	(14.0)	(11.9)%
Processed Food and Materials	70.1	65.1	+5.0	+7.7%
Fine Chemical	18.8	20.4	(1.5)	(7.7)%
Other/Adjustments	2.5	2.6	(0.0)	(2.5)%
Operating profit	20.8	16.1	+4.6	+28.8%
Oil and Fat	18.9	14.6	+4.3	+29.8%
	Oil and Meal	14.4	9.0	+5.3	+59.2%
	Processed Oil and Fat	4.5	5.5	(1.0)	(18.5)%
Processed Food and Materials	0.9	0.5	+0.4	+85.7%
Fine Chemical	1.2	1.3	(0.1)	(12.8)%
Other/Adjustments	(0.3)	(0.3)	+0.0	―

* Amounts of less than 0.1 billion yen are rounded down.

Change in FY2023 Operating Profit by Business Segment

■Oil and Meal

6

(Billion yen)

• Operating profit increased year on year thanks to successfully establishing appropriate sales prices and the fact that the decline in sales prices was more limited than the decline in costs.

Domestic oil and fat +5.50

+19.55

	(11.45)	(0.60)			14.4
9.0		(2.00)	(0.10)	(0.00)

FY2022	Cost factors	Unit sales price	Sales volume	SG&A expenses,	Subsidiaries	Consolidation	FY2023
		factors	factors	other		adjustments, other

	Breakdown of cost factors
Soybean	+6.50 [C&F+12.50, foreign exchange (6.55), meal sales +0.55]
Rapeseed	+23.30 [C&F+29.70, foreign exchange (6.10), meal sales (0.30)]
Other products &	(10.25)
manufacturing costs

Breakdown of unit sales price factors

Commercial-use and	(11.50)
processing-use
Household-use	+0.05

Breakdown of sales volume factors

Commercial-use	+0.10
and processing-use
Household-use	(0.70)

YoY Change in sales volume

Commercial-use	+0.3％
and processing-use
Household-use	(4.1)％

Change in FY2023 Operating Profit by Business Segment

■Processed Oil and Fat

7

(Billion yen)

• Sales and profit decreased due to lower sales prices, lower refining margin as well as the effects from mark-to-market valuation on futures and other products, despite increased sales volume.

Overseas processed oil and fat (2.30)

ISF (Malaysia) (2.60)

+13.25

5.5		＋2.30	＋0.10		＋0.30	+1.30	+0.00	4.5
	(16.00)			(2.25)
FY2022	Cost factors Unit sales price	Sales volume	SG&A	Mark-to-market	ISF Italy	Domestic	Consolidation	FY2023
	factors	factors	expenses,	valuation on palm	ISF Shanghai	processed oil	adjustments,
			other	oil transactions		and fat	other

Breakdown of cost factors

Raw materials costs

+13.70

Manufacturing costs,	(0.45)
other

Breakdown of unit sales price factors

Specialty fats

(6.20)

Other (9.80)

Breakdown of sales volume factors

Specialty fats	+0.50
Other	+1.80

Breakdown of mark-to-market valuation

FY2022 +1.45

FY2023 (0.80)

YoY change in sales volume

of specialty fats

+13％

Change in FY2023 Operating Profit by Business Segment

8

(Billion yen)

■Processed Food and Materials

■Fine Chemical

• Operating profit increased year on year due to higher sales volume and improved gross profit per unit of chocolate.

• Operating profit decreased year on year mainly due to lower sales volumes of our European subsidiary.

+0.70

(0.05)

+0.05 0.9

(0.25) (0.00)

0.5

1.3

+0.00

(0.15) (0.00)

1.2

FY2022	Chocolate Seasoning Functional	Soybean	Consolidation	FY2023
	materials	materials	adjustments,
	and foods	and foods	other

FY2022	Fine chemical	Environment	Consolidation	FY2023
and hygiene-
	products	adjustments,
	related
		other
		products

MCT net sales

7.1 [+0.9 YoY]

Raw materials for cosmetics net sales

9.8 [(0.4) YoY]

Consolidated Balance Sheets and Cash Flows

■Consolidated Balance Sheets

9

(Billion yen)

Items	End of March	End of March		Change
2024	2023
Total assets		374.4		+18.9
393.3
Current assets	232.7	233.5	(0.8)
Non-current assets	160.5	140.8	+19.7
Total liabilities	200.8	203.0		(2.2)
Interest-bearing liabilities	96.9	105.8	(8.8)
Other liabilities	103.8	97.2	+6.6
Total net assets	192.5	171.4		+21.1

Items	End of March	End of March
2024	2023
Equity ratio	46.4%	43.4%
Net D/E ratio	0.42	0.57

• Interest-bearingliabilities decreased due to improved operating cash flows.
• Indicators for financial soundness improved due to an increase in profit and a decrease in interest-bearing liabilities.

■Cash Flows

Items	FY2023	FY2022	Change
results	results
Operating cash flows	+36.7	+0.3	+36.3
Profit before income taxes	+21.1	+15.3	+5.8
Depreciation	+9.2	+9.3	(0.1)
Decrease (increase) in working capital	+4.4	(24.9)	+29.4
Investing cash flows	(16.0)	(6.1)	(9.9)
Financing cash flows	(14.5)	+6.3	(20.9)

• Working capital reduced due to a decrease in inventories caused by a drop in raw material costs and decrease in in-stock volume.
• Operating cash flows turned substantially positive due to a decrease in working capital as well as an increase in profit.
  * Amounts of less than 0.1 billion yen are rounded down.

FY2024 Forecast