Despite a predicted profit of ¥19bn (US$154m), Japanese company Nippon Meat Packers now expects a ¥1bn group net loss for the year ending March due to a down turn in sales caused by the recent mislabelling scandal.
The turnaround is thought to be caused by the discovery earlier this year that Nippon Meat had obtained government subsidies by relabelling imported beef as Japanese meat. The government had initiated a buyback scheme to try to prevent meat infected with BSE from reaching consumers.
A new mislabelling scandal that alleges the company changed the expiry dates of frozen meat dumplings to increase sales of the products also hit the headlines recently (to read more about this, just-food.com members click here).
Many stores took Nippon products off their shelves, leading Nippon’s sales figures to fall substantially.
Parent company Nippon Meat has said that the mislabelling scandal could cost it ¥3.7bn. The company changed its expected net profit for the half to ¥1.5bn, a decrease of 84.2%, and its expected sales to ¥473bn, a decrease of 4%, reported Dow Jones International.
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