Meiji focused on "mainstay" food products

Meiji focused on "mainstay" food products

Meiji Holdings has reported higher nine-month profits, as the Japan-based dairy-to-confectionery group raised prices to offset raw material costs but also saw net sales grow in what it called "a favourable consumption environment".

The company booked net income of JPY51.21bn (US$438.3m) for the period to the end of December, up 73.2% on the year before.

Operating income grew 38.1% to JPY59.3bn. Meiji said it "compensated" for raw material procurement costs with price increases. Meiji also pointed to "product mix improvements" as well as the "optimisation" of production and distribution.

Net sales were up 5.2% at JPY914.36bn. Sales from fresh and fermented dairy, from confectionery and from Meiji's "nutritionals" division rose.

Meiji said its sales of functional yoghurt increased "significantly". In confectionery, higher chocolate and gummy sales offset a fall in gum revenue.

The group's processed foods division saw cheese and ice cream sales grow but a decline in margarine sales.

Meiji did sound a note of caution on the outlook for the Japanese economy. "During the first nine months of the financial year ending March 2016, the Japanese economy transitioned towards a mild recovery, thanks to improved corporate earnings and employment. Despite expectations towards improved consumer spending and measures to beat deflation, downside risks for the overseas economy may impact on the domestic economy. Accordingly, the future of the Japanese economy remains unclear."