Topics

IR Topics for the Year Ended March 31, 2012

Nichimo continues to support the reconstruction of the fishing industry in North East Japan.

The fishing and seafood industry has been always our most important business partner ever since Nichimo was founded in 1910. The local industry in North East Japan was seriously damaged when the devastating earthquake and tsunami struck the area in March 2011. Knowing that they would be in urgent need of our services and products to recover from the disaster, the Nichimo Group wasted no time in resuming our business while our Ishinomaki Office and a couple of group factories suffered some damage.

Tohoku Nichimo Co., our subsidiary located in North East Japan, had to suspend operations of its Hiyoriyama and Ishinomaki Factories in Miyagi Prefecture due to damage from the disaster. Ishinomaki Factory fully restored their operations and resumed net fabrication & repair services in April 2011, soon followed by Hiyoriyama Factory.

Silver salmon farming in Miyagi Prefecture, one of its key farming bases, didn’t escape damage by the earthquake. Big tsunami waves washed away most of the farming cages in the Onagawa and Ogatsu districts. Inland seedling tanks, however, were saved, and seedlings in the tanks survived the earthquake. The challenge was that the farmers would have to install new ocean cages by November 2011 to transfer the seedlings and keep them grow.

Nichimo investigated sea bottom conditions along the coast line of Onagawa and Ogatsu districts with a side scan sonar and found that accumulation of rubbles on the sea bottom was not as serious as we had expected. We promptly started to fabricate nets for new silver salmon cages, as well as new seine nets for local fishermen.

New ocean cages were installed in the water by November, 2011. The silver salmon seedlings grew in the new cages and harvested in May 2012. It was the first harvest in the year. The harvested fish were freshly processed into fillet and other products at a local processing factory before noon and delivered to supermarket stores in the afternoon.

Nichimo Mariculture Co., our subsidiary, supplies silver salmon seedlings and related management & consulting services. Nichimo distributes and markets market-size fish together with Nichimo Foods Co., a sales & marketing arm of our group. Nichimo works closely with our group companies to continue supporting the reconstruction of the fishing and seafood industry in North East Japan.

Nichimo supplies quality crabs from Russia and Alaska, US with assured traceability
<Food Business>

We supply quality crabs caught in Russian and US Alaskan waters and freshly frozen at sea or land factories with assured traceability.

Nichimo technicians provide technical services on board our partner vessels in Russia and we work with land factories both overseas and in Hokkaido, Japan to ensure freshness and high quality of the products as well as stable supply to our customers.

In addition to a various types of processed crab products available to satisfy market needs, we develop and introduce new products that taste even better and are easier and more ready to eat.

Nichimo’s Food Business Department and Nichimo Foods Co., our subsidiary, supply crabs and processed crab products with assured traceability to restaurants, hypermarket chains and on-line shopping stores.

Nichimo Foods Co. also makes some of our renowned crabs and seafood products available for consumers at Rakuten, one of the largest Japanese on-line shopping malls.

Nichimo delivered new gyoza (pot stickers) cooking machines designed and developed for a leading convenience store chain
<Machinery Business>

Nichimo, together with Daiei Engineering Co., Ltd. (“Daiei Engineering”), one of the top Japanese manufacturers of Chinese food processing/forming systems, recently designed and developed the new rotary-type gyoza (pot stickers) cooking machine for one of the top Japanese convenience store chains.

Several units of the newly developed gyoza cooking machine were delivered to the chain’s food processing factories. Their pan-fried gyoza products prepared with our system are now sold at their stores nationwide.

The new system has a doughnut-shaped metal disc, which is heated and rotates at a constant speed to pan-fry gyoza. Not like conventional manual pan-frying, the rotary disc system eliminates irregularities of its surface temperature to ensure consistent product quality and reduce waste due to poor or over browning. It also releases workers from hard and hot manual pan-frying work. The system requires only two persons to operate, ensures consistent frying and browning quality, and has a capacity to process as many as 2,500 pieces of gyoza per hour.

Daiei Engineering manufactures a wide range of machinery and equipment to process/form Chinese food including spring rolls, gyoza, shaomais and wontons and supplies them to both the domestic and overseas markets. They have the world’s largest market share of spring roll machines.

Nichimo’s Machinery Business Department works closely with Daiei Engineering and other manufacturers to provide a comprehensive line of services and products, from factory engineering to supply of full production lines as well as individual large-scale machinery & equipment, to meet different needs of customers.