Points of Business Performance

The Company aimed to become a “strong company that can maintain sustainable growth by resolving social issues through food” under　the three-year mid-term management plan starting from the fiscal year ended December 2019. The Company makes efforts to further enhance its corporate value by working on the basic strategies in the mid-term management plan, namely (1) continuous enhancement of earnings power and (2) growth by tackling new businesses and new domains.During the consolidated year under review (January 1, 2019 to December 31, 2019), consolidated revenue declined year on year particularly in the domestic agriculture businesses and international business, and core operating income decreased.

The Company also posted a 1,692 million yen gain on transfer of business as other income when Kagome Distribution Service Co., Ltd., a physical distribution subsidiary, was integrated with a new physical distribution company, F-LINE Corporation. In other expenses, the Company posted a disaster loss of 361 million yen due to significant damage caused to a subsidiary, Chiba Baby Leaf Garden CO., Ltd. By large typhoons that struck the area in September and October 2019.

1. 1. This forecast for 2020 is based on International Financial Reporting Standards (IFRS) because Kagome started using these standards in 2019.
2. 2. Rebates involving sales are deducted directly from revenue. In prior years, rebates were included in selling, general and administrative expenses.
3. 3. Core operating income is an indicator of earnings from continuing operations. This income is revenue minus the cost of sales and selling, general and administrative expenses and includes equity gains of affiliated companies.