Ajinomoto, the Japan-based food and ingredients group, has cut its forecasts for annual sales and earnings, citing exchange rates as a factor.

The company now expects net sales to reach JPY1.1trn (US$10.32bn) in the year to the end of March, down 7.5% on the sales it generated in its previous financial year. Ajinomoto is now forecasting operating income will hit JPY81.5m, which would equate to a year-on-year decline of 10.3%. It sees profit attributable to the owners of the parent reaching JPY44.5bn, down 29.8%.

In May, Ajinomoto had forecast its net sales would reach JPY1.19trn in its current financial year, translating to operating income of JPY91bn and net profit of JPY51bn.

In the 12 months to 31 March this year, Ajinomoto generated net sales of JPY1.19bn, operating income of JPY91bn and net profit of JPY63.5bn.

The new forecasts came alongside Ajinomoto’s first-half results, which included lower net sales and earnings. In the six months to the end of September, Ajinomoto generated net sales of JPY522.56bn, down 11.4% year-on-year.

Sales fell across the business. Lower coffee sales, as well as a fall in the sales seasonings and processed foods products after the sale of a subsidiary in Japan, hit Ajinomoto’s domestic sales.

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By GlobalData

International food product sales dropped thanks to the strength of the Japanese yen.

Ajinomoto’s operating income fell 17.1% to JPY39.16bn. The company’s profit attributable to the owners of the parent slid 40.3% to JPY25.04bn.

Fellow Japanese food group Yakult also cut its annual forecasts this week, citing pressure from exchange rates.

Earlier this week, Ajinomoto announced it had acquired a 33.33% stake in pan-African food group Promasidor Holdings for US$531m