Ajinomoto said today (31 October) that it expects to record a first-half net loss as rising costs hit its Amoy Foods subsidiary.
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The Japanese food company said it expects to post an extraordinary loss of JPY13.4bn (US$136.1m) for the six months to the end of September on the impairment of goodwill at Amoy.
“Rising raw material and fuel prices have increased costs for this subsidiary, which Ajinomoto acquired previously, and the earnings assumed at the time of the acquisition can no longer be expected,” the company said. “Ajinomoto will therefore write down the book value to the recoverable value.”
Ajinomoto also said it would record an extraordinary loss on stock of an affiliate of JPY8.6bn on a non-consolidated basis on impairment of its shareholdings in Amoy.
The group said it estimates its consolidated net loss for the six months to the end of September to be JPY4.86bn, compared with the previous year’s profit of JPY13.97bn.
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By GlobalDataAjinomoto said it would give a forecast for its full financial year ending on 31 March 2009 when it publishes its interim results on 7 November.
